SUCCESS FORTUNE FINANCIAL PLANNING LTD v. NG HUNG MING AND OTHERS

DCMP 3490 & 3491/2019

(Heard Together)

[2025] HKDC 1045

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 3490 OF 2019

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AND

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 3491 OF 2019

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(Heard Together)

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DECISION

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A.  Introduction

1.  This is D1 (“Ng”)’s application in each of DCMP 3490/2019 and DCMP 3491/2019 by summonses dated 2 April 2025 (the “Summonses”) for:

(1)  leave to appeal out of time against the court’s judgment dated 29 November 2024 in each of DCMP 3490/2019 and DCMP 3491/2019 (which were dealt with together) (the “Judgment”);

(2)  leave to appeal; and

(3)  stay of execution of the Judgment pending appeal.

2.  By an originating summons filed on 22 October 2019 in DCMP 3490/2019, P sought:

(1)  money judgment pursuant to O 83A of the Rules of the District Court (Cap 336H) (“RDC”) against Ng and D2 (“Yu”); and

(2)  an order for sale of the property known as Flat B on the Third Floor including the Flat Roof appurtenant thereto, Kam On Building, No 94 Nga Tsin Wai Road, Kowloon (“Kam On Property”) [1] pursuant to O 88 of RDC and sections 2, 3 and 6 of the Partition Ordinance (Cap 352) against Ng and D3 (“Wong”).

3.  By an originating summons filed on 22 October 2019 in DCMP 3491/2019 (together with the originating summons in DCMP 3490/2019, the “Originating Summonses”), P sought:

(1)  money judgment pursuant to O 83A of RDC against Ng and Yu; and

(2)  an order for sale of the property known as Flat 9 on 1^st Floor, Cambridge Building, Nos 6-24A Kam Wing Street, Kowloon (“Cambridge Property”)[2] pursuant to O 88 of RDC and sections 2, 3 and 6 of the Partition Ordinance against Ng, Wong and D4 (“Tsang”).

4.  As stated in paragraph 32 of the Judgment, it is Ng’s case at the hearing on 4 November 2024 (which he maintains in paragraph 41 of his Skeleton Submissions in this application) that the he had fully repaid all the loans mentioned in paragraph 11 of the Judgment with a total sum of $3,062,070, which consisted of:

(1)  The cashier’s order in the amount of $1,500,000 he paid to P’s solicitors on 24 January 2019;

(2)  Yu’s payment of $500,000 to P; and

(3)  Ng’s payment in the amount of $1,062,070 under Kai Ming Loans[3].

See also paragraph 34 of Ng’s 2^nd Affirmation.

5.  For the reasons given in paragraphs 30 to 46 of the Judgment, the court ruled in favour of P and held that Ng and Yu had failed and/or refused to repay the outstanding amount under the Subject Loan Agreements[4]. The court also granted an order for sale in each of the respective actions.

B.  Purported grounds of appeal

6.  In his draft notices of appeal, Ng’s purported grounds of appeal in the two actions are:

(1)  The court erred in law in holding that there was no triable issue in respect of P’s claims against Ng (“Ground 1”);

(2)  The court ought to have held that there was a triable issue whether Ng had been induced by P’s misrepresentation that the respective Kam On 2^nd Loan[5] and Cambridge 2^nd Loan[6] were just extensions of respectively Kam On 1^st Loan[7] and Cambridge 1^st Loan[8] (“Ground 2”);

(3)  The court ought to have held that there is a triable issue as to whether the respective Kam On 2^nd Loan and Cambridge 2^nd Loan were drawn down and appropriated towards the repayment of Kai Ming Loans and/or whether P had lent any sum to Ng at all under respectively Kam On 2^nd Loan and Cambridge 2^nd Loan (“Ground 3”);

(4)  The court ought to have held that there was a triable issue as to whether Ng and Yu had, between themselves, fully repaid all the loans which Ng owed to P, including Kam On 1^st Loan and Cambridge 1^st Loan (“Ground 4”);

(5)  The court ought to have held that there was a triable issue as to whether Yu had paid P a sum of $500,000 for the repayment of the loans jointly and severally owed by Ng and Yu to P (“Ground 5”);

(6)  The court ought to have found that there was a triable issue on P’s allegation that in February 2019, Ng orally agreed with P through Mr Li Cho Chuen (“Li”) to appropriate part of the sum of $1,500,000 to the repayment of the loans owed by Yu to P in the absence of any documentary evidence, and owing to the inherent improbability, of the alleged oral agreement, which Ng denies (“Ground 6”);

(7)  The court ought to have held that Ng repaid the sum of $1,500,000 wholly towards Kai Ming Loans, or that there is a triable issue as to whether the sum of $1,500,000 was so repaid (“Ground 7”);

(8)  The court failed to take into account the sum of $200,000, being the amount of Kam On 2^nd Loan together with another sum of $20,000, being the amount of Cambridge 2^nd loan, which on P’s case were used to repay Kai Ming Loans, and the court ought to have found that on P’s case, by 19 December 2018, Ng and Yu owed P the outstanding principal under Kai Ming Loans only in the sum of $2,200,000 with the result that in relation to Kai Ming Loans, after paying the sum of $1,500,000 on 24 January 2019 and $1,062,070 on 25 February 2019, Ng had overpaid P by an approximate sum of $400,000 or such other sum found in excess of Ng and Yu’s indebtedness under Kai Ming Loans, which Ng is entitled to set off wholly or partly against Kam On 2^nd Loan and Cambridge 2^nd Loan, if they existed (“Ground 8”); and

(9)  The court ought to have held that the circumstances of P require investigation at trial, in particular, whether and/or why Yu’s cashier’s order dated 24 January 2019 for the sum of $1,500,000 was dishonoured and whether, and if so, how much Ng and Yu owed, to P under Kam On 2^nd Loan and Cambridge 2^nd Loan (“Ground 9”).

C.  Applicable legal principles

C1.  Leave to appeal

7.  Pursuant to section 63A of the District Court Ordinance (Cap 336), leave to appeal may only be granted if the court is satisfied that the intended appeal has a reasonable prospect of success or that there are some other reasons that the intended appeal should be heard. Reasonable prospect involves the notion that the prospect must be more than “fanciful” without having to be “probable”. See eg Hong Kong Balance International Trading & Logistics Co Ltd v Kwok Yiu Hung and Ng Kwok Wai [2025] HKCA 283, §13, per Kwan VP.

8.  When determining an application for leave to appeal out of time, the court will consider (1) the length of the delay; (2) reasons for the delay; (3) whether the intended appeal has reasonable prospect of success; and (4) prejudice to other parties if leave to appeal out of time is granted. See Huang Lidong v Kwong Wing Chung [2024] HKCA 465, §13, per Anthony Chan J.

9.  Where the reasons given for the delay are not satisfactory, the applicant must show “real prospect of success” (a strongly arguable case) on the merits of his proposed appeal before the court will exercise its discretion to grant an extension of time. See Huang Lidong (supra), §16.

C2.  Stay of execution pending appeal

10.  The parties agree that the principles applicable to an application for stay of execution pending appeal are trite and are those set out in Star Play Development Ltd v Bess Fashion Management Co Ltd [2007] 5 HKC 84, §§6-10, per Ma J (as he then was). In gist, the court has to consider (1) the merits of the appeal and (2) whether the appeal would be rendered nugatory without a stay.

D.  Leave application

D1.  Lateness and reasons for delay of the leave application

11.  The Judgment was handed down on 29 November 2024. Pursuant to O 58 r 2(4)(b) of RDC, an application for leave to appeal must be made within 28 days from the date of the Judgment, ie by 27 December 2024. Ng’s delay of 96 days in taking out the leave application on 2 April 2025 was substantial.

12.  As to his explanation for the delay, on 24 December 2024, ie 5 days before the deadline in taking out the leave application, when the lawyers who he had consulted asked him to put them in funds, Ng decided to change lawyers, even though the deadline for his leave application was approaching.

13.  He then took no action until February 2025 when his mother contacted his current lawyers. After that, it took him another month to borrow money from his mother to put his lawyers in funds on or around 5 March 2025.

14.  Notwithstanding the substantial delay which had already occurred, he gave no explanation at all as to why it took him another 4 weeks to finally take out the present application.

15.  In the premises, I find that Ng’s explanation for the delay is unsatisfactory and inexcusable. He must therefore show “real prospect of success” (a strongly arguable case) on the merits of his proposed appeal before the court will exercise its discretion to grant an extension of time.

D2.  The purported grounds of appeal

Ground 1

16.  This ground does not demonstrate how and why the court went wrong. It does not even make out a case that the court’s conclusion is wrong.

Ground 2

17.  The allegation of misrepresentation is a new argument which was not raised by Ng in the hearing of the Originating Summonses. In any event:

(1)  First, there is no evidence in support of the alleged misrepresentation or how Ng had been allegedly induced by the alleged misrepresentation.

(2)  Secondly, any allegation of misrepresentation is directly refuted by the instruction letters dated 19 December 2018 signed by Ng and Yu and addressed to P and its lawyers (the “Instruction Letters”) referred to in paragraph 36 of the Judgment, expressly instructing the latter to utilise the facility from Kam On 2^nd Loan and Cambridge 2^nd Loan to satisfy part of the outstanding amount under Kai Ming Loans.

Ground 3

18.  This purported ground of appeal is precisely the first ground relied on by Ng in opposing the Originating Summonses: see paragraph 31(1) of the Judgment. Ng is simply rehashing the arguments which he had deployed before. In paragraphs 35 to 39 of the Judgment, the court has already dealt with such arguments and rejected the same. In particular, the court held that Ng’s allegation is flatly contradicted by the Instruction Letters.

Ground 4

19.  It is unclear what this purported ground of appeal means. Ng and Yu are jointly and severally liable as co-borrowers under the Subject Loan Agreements: see paragraphs 11 to 12 of the Judgment. As held in paragraphs 30, 34 and 46 of the Judgment, Ng and Yu have failed to repay the outstanding amounts under the Subject Loan Agreements. Insofar as this purported ground seeks to challenge such a finding of fact, it fails to identify how and why the court went wrong.

Ground 5

20.  Ng is simply rehashing the arguments which he had deployed before. In paragraph 45 of the Judgment, the court has already held that there is simply no evidence in support of the allegation that Yu had repaid $500,000 to P. Ng has not explained how and why such a conclusion was wrong.

Ground 6

21.  It is not exactly clear what this purported ground of appeal means. Ng appears to suggest that the court ought to have found that there is a triable issue as to whether Ng had orally agreed with P to appropriate part of the sum of $1,500,000 repaid on 24 January 2019 for the repayment of loans owed by Yu to P. However:

(1)  First, it is not P’s case that the repayment of $1,500,000 was used to repay loans owed solely by Yu to P. As explained in paragraph 41 of the Judgment, the sum was used to repay part of Kai Ming Loans and an amount of $4,840 under each of Subject Loan Agreements.

(2)  Secondly, as stated in paragraph 11 of the Judgment, the Subject Loan Agreements as well as Kai Ming loans are all owed by Ng and Yu jointly and severally as co-borrowers. It is therefore unclear as to how appropriating part of the $1,500,000 to the Subject Loan Agreements, rather than Kai Ming Loans, would prejudice Ng, or is inherently improbable, due to any alleged difference in the identity of the borrowers.

(3)  Thirdly, and in any event, by treating part of the $1,500,000 as repayment under the Subject Loan Agreements actually reduces Ng (and Yu)’s indebtedness to P under the Subject Loan Agreements to Ng (and Yu)’s advantage. It is therefore unclear as to how Ng’s contention that the entirely of the sum of $1,500,000 was used to repay Kai Ming Loans would assist his case in these proceedings.

Ground 7

22.  As explained in paragraph 21(3) above, it is unclear how this purported ground would assist Ng’s case as it would only reduce the amount which he has repaid under the Subject Loan Agreements and thereby increase his indebtedness to P under the Subject Loan Agreements.

Ground 8

23.  This purported ground is misconceived for the following reasons:

(1)  Ng has failed to take into account the interest payments and late charges. As explained by P, the correct calculations as supported by evidence are as follows:

(a)  As at 15 January 2019, the total outstanding amount (including interest and late charges) under Kai Ming Loans was $2,691,557.[9]

(b)  The above amount has clearly not taken into account the $400,000 repayment from Kam On 2^nd Loan and Cambridge 2^nd Loan as mentioned above.

(c)  By around 24 January 2019, further interest and late charges in the sums of $4,758[10] and $270[11], ie a total sum of $5,028, accrued on Kai Ming 1^st Loan and Kai Ming 2^nd Loan respectively.

(d)  On around 24 January 2019, $1,274,415 out of the $1,500,000 repayment sum mentioned above was used to partially repay Kai Ming Loans.[12]

(e)  By around 1 March 2019, further interest and late charges in the sums of $18,270[13] and $21,630[14], ie a total sum of $39,900, accrued on Kai Ming 2^nd Loan and Kai Ming 3^rd Loan respectively.

(f)  Taking into account the $400,000 repayment mentioned in (b) above, an amount of $1,062,070 remains outstanding under Kai Ming Loans, which exact amount was repaid by Ng on 28 February 2019 as explained in sub-paragraph (2) below.[15]

(g)  There is therefore no alleged “excess”, “spillover” or “overpayment” under Kai Ming Loans.

(2)  As evidenced by a letter from P’s solicitors to Messrs Fan Wong & Tso (being Urban Renewal Authority’s lawyers) dated 25 February 2019 and the receipt on discharge of a charge dated 28 February 2019 in respect of Kai Ming Mortgage[16], an exact sum of $1,062,070 out of the purchase price of the Kai Ming Property sold by Ng to Urban Renewal Authority was paid by Urban Renewal Authority to P to discharge the Kai Ming Loans on 28 February 2019. It is incorrect for Ng to suggest that “there is no shred of any documentary evidence” in support of the same.[17] There was therefore no excess, spillover or overpayment under Kai Ming Loans.

(3)  As explained above, it is all along Ng’s case that he had fully repaid all loans with a total sum of $3,062,070, which consisted of inter alia Yu’s payment of $500,000 to P. In light of the court’s finding that Yu did not repay $500,000 to P, it follows that the Subject Loan Agreements and Kai Ming Loans have not been fully repaid.

Ground 9

24.  As stated in paragraph 33 of the Judgment, there is no dispute that the cheque in the amount of $1,500,000 paid by Yu to P was dishonoured. In the premises, there is no issue as to whether such cheque was dishonoured[18] , and the question of why such cheque was dishonoured is simply irrelevant.

25.  For the reasons above, I find that Ng has failed to demonstrate real prospects of success on the merits of any of his purported grounds of appeal. I therefore dismiss Ng’s application for leave to appeal out of time.

E.  Stay of execution application

26.  As I do not grant leave to appeal out of time, the stay of execution application falls away.

27.  In any event, there is no evidence that the appeal would be rendered nugatory. There is no absolute rule or principle that where the relevant order concerns the possession of a property, the appeal would necessarily be rendered nugatory absent a stay. The burden remains on the applicant to establish and put forward evidence that the appeal would be rendered nugatory. See Sherman Ngoi Wing Lee v Lee Hoi Wing Michael and Lee Hon Kuen Gordon, the joint executors of the estate of Lee Koon Wan [2024] HKCFI 2552, §5.15.

28.  However, in the present application, first, there is no evidence that the appeal would be rendered nugatory in respect of the sale of the Cambridge Property. As to the Kam On Property, there is no suggestion of any hardship other than financial ones, being a lower reserve price for the sale of the property than the amount offered by the Urban Renewal Authority. Not only does this fail to show that the appeal would be rendered nugatory, the reserve price may not even be the eventual sales price. A lower reserve price does not necessarily lead to any financial loss if the eventual sales price is higher than the price offered by the Urban Renewal Authority.

29.  Further, according to Ng’s 4^th Affirmation filed on 9 May 2025 in DCMP 3491/2019, Ng does not reside at “the property”. Although it is unclear whether Ng is referring to the Cambridge Property only or both the Cambridge Property and Kam On Property, this reinforces the above finding that there is no suggestion of any hardship other than financial ones.

30.  For the reasons above, I dismiss Ng’s stay of execution application.

F.  Conclusion

31.  For all the reasons above, I dismiss the Summonses.

32.  I make a costs order nisi that Ng do pay P’s costs of the Summonses, with certificate for counsel. Such costs are to be summarily assessed on papers. Ng do provide his objections (if any) to the Statements of Costs filed by P together with its Skeleton Submissions within 7 days from the date of this decision.