LEUNG KWAN CHONG v. CHEUNG YUK CHUN

DCMP 2954/2012

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 2954 OF 2012

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JUDGMENT

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Introduction

1.  The plaintiff (“Leung”) commenced these proceedings by way of an originating summons dated 28 November 2012 for, principally, an order for sale of a car parking known as No.60, Ground Floor of Kwun Tong Industrial Centre, No. 436-446 Kwun Tong Road, Kowloon (“the Property”) pursuant to section 6 of the Partition Ordinance, Cap. 352.

2.  Leung and the defendant (“Cheung”) got married in 1982. The Property was acquired by them in late 1989 and has been registered in their joint names as joint tenants ever since.

3.  Cheung commenced a divorce petition in 2003 and the marriage was formally dissolved by a decree absolute dated 29 January 2004. In February 2009, Leung sought the assistance of the court to deal with, among other things, the Property by way of an application for ancillary relief. His application was dismissed due to the fact that his application was made only after his re-marriage on 29 June 2005.

4.  Memfus Wong Surveyors Limited commissioned by Leung prepared a valuation report dated 6 April 2013 in respect of the Property. The valuation of the Property stands at HK$1.6 million.

Outcome

5.  This morning Leung’s solicitors submitted to me a draft order and I confirmed with Cheung that she agreed to most of the contents of the order. With the parties’ agreement, I make the following order:

(1) the Property be sold by way of public auction within 45 days from the date hereof at a price not lower than HK$1.5 million;

(2) Leung or his solicitors shall have conduct in engaging property surveyors to carry out the public auction. Cheung do within 14 days from the date hereof deliver all the title deeds and documents in respect of the Property to her solicitors (to be instructed) with a view to and for the purpose of the sale of the Property;

(3) all costs and expenses including the costs of the preparation of the surveyor report dated 6 April 2013 be borne by Leung and Cheung in equal shares; and

(4) the proceeds of sale of the Property after deduction of expenses and liabilities be paid to Leung and Cheung in equal shares.       

Costs Order

6.  The only controversy was about costs. Leung asked for costs of this action and his own costs to be taxed in accordance with the Legal Aid Regulations. Cheung disagreed.

7.  Cheung contended that she had previously offered to buy out Leung’s interest in the Property and had Cheung accepted her offer, these proceedings could have been avoided.

8.  Cheung referred me to paragraph 17 of the 2^nd Affirmation of Leung to confirm the existence of the offer. There, Leung recounted a conversation between Cheung’s former solicitors and him outside a courtroom in or about June 2009. In gist, in the course of the law suit, Cheung was offered HK$300,000 for his interest in the Property together with other matrimonial properties. Leung was then unrepresented and he rejected the offer.

9.  I do not find Leung’s rejection of such an offer to have any bearing on the issue of costs. I further note that prior to the commencement of these proceedings, by letter dated 7 November 2012, Leung’s solicitors indicated to Cheung that Leung intended to apply for an order for sale of the Property. Cheung was asked to consider purchase of Leung’s interest in the Property at market value. Cheung was further asked to reply within 14 days.

10.  Cheung did not reply to this letter. In her affirmation, she explained that she did not deliberately ignore the letter and she was just too busy to give a reply due to, among other things, the health conditions of her son and her daughter-in-law. I cannot accept her explanation.  

11.  In her affirmation, she also stated that she would never want the Property to be sold regardless of the amount offered. It was due to the fact that the Property was purchased when she was having the sweetest moment with Leung. Cheung explained that her then position was that she would never allow the Property to be sold to a third party as it was in her view indicative of their good time. Now that she realized that she did not have any valid ground to oppose the sale, she could only consent to the same by auction.     

12.  I also note that in her affirmation, she asserted that her company actually provided all the purchase monies of the Property. She claimed that she added Leung to be a joint tenant merely for the sake of easy arrangement in case of any mishap befalling her when she worked on the Mainland. If what she said is true, Leung could only be her nominee and should not have any beneficial interest in the Property at all.

13.  Nothing advanced by Cheung alters the fact that Leung had to commence these proceedings and wait until this hearing to cause the Property to be sold and the proceeds of sale to be distributed in the manner agreeable to both parties. Costs should therefore follow the event. I order that Cheung shall pay Leung his costs of this action to be taxed if not agreed and that Leung’s own costs to be taxed in accordance with the Legal Aid Regulations.

14.  Lastly, interpretation service in relation to this Judgment can be arranged for Cheung if so applied for.