CHUNG HO FAI v. SO SUK YIN AND ANOTHER

HCMP 873/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 873 OF 2012

(ON AN INTENDED APPEAL FROM DCCJ NO 4444 OF 2009)

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BETWEEN

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JUDGMENT

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Hon Tang VP (giving the judgment of the Court):

1.  The Plaintiff's claim against the Defendants is for a debt of RMB 650,000. The debt is admitted. However, the defence is that it was agreed between the Defendants and the Plaintiff that the amount should be deducted from a consultancy fee payable under an agreement for payment of consultancy fee dated 26 September 2005, which was to be in the sum of RMB 1,077,000. The consultancy fee agreement was signed with the sister of the Plaintiff (Chung Kan Sim), who was the Plaintiff's nominee. Accordingly, the Plaintiff's sister signed that document for and on behalf of the Plaintiff.

2.  After a trial that occupied 3 days, H H Judge Chow found in favour of the Defendants.  On 17 April 2012, he refused leave to appeal.

3.  The Plaintiff wishes to appeal to this Court, but was one day late in filing the application.  He now applies to us for leave to appeal out of time.  We can deal with the matter by looking not so much at whether the Plaintiff should be given an extension of time to appeal, but whether the Plaintiff has demonstrated that there is a reasonable prospect of success.

4.  Mr Hylas Chung (who appears for the Plaintiff) has in his detailed skeleton submissions argued: Firstly, there has been no valid equitable assignment.  Secondly, there has been no valid novation.  He mentioned that the evidence did not support any finding that there was consultancy fee payable to the Defendants as summarised in paragraph 4 of the learned judge's judgment. 

5.  In gist, the Defendants' case was that the Plaintiff agreed that he would lend RMB 650,000 to the Defendants interest-free and that this sum should be deducted from the consultancy fee payable.  But when the time came for the payment, the Plaintiff insisted that an interest of RMB 20,000 should be added.  That is why eventually, the sum which had been deducted from the consultancy fee payable was RMB 670,000.

6.  The defence is supported by 3 documents, which were summarised in paragraphs 6 to 8 of the judgment.  Paragraph 6 is the consultancy fee agreement.  Paragraph 7 is a letter from the Plaintiff to his sister, asking her to deduct RMB 670,000 (made up of RMB 650,000 plus RMB 20,000 by way of interest).  The letter stated that RMB 670,000 should be deducted and then the balance should then be paid to the 2^nd Defendant.

7.  The 3^rd document dated 26 October 2005 was stated to be a 顧問費付款說明. It was signed by the Plaintiff's sister as well as by the 2^nd Defendant. This explained that after the deduction of RMB 670,000, a balance of RMB 407,000 was payable to the 2^nd Defendant and that was the amount actually paid.

8.  Also the learned judge was not impressed with the Plaintiff, who gave evidence, denying such arrangements.  He did not regard the Plaintiff as a witness of truth.

9.  In all the circumstances, we do not consider that the Plaintiff's proposed appeal has any prospect of success.  For that reason, no leave to appeal should be given.  Since the Plaintiff is out of time, it would mean that an extension of time would not be granted.  We dismiss the Plaintiff's application. 

10.  There is also the Defendants' application for security for costs.  It is now academic. 

11.  The application for leave to appeal out of time is dismissed with costs.  There should be costs in favour of Defendants as well in relation to the application for security for costs.