CHAN TZE NGON v. CHAN TSZ KON

HCMP 574/2023

[2023] HKCFI 2066

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 574 OF 2023

____________________

____________________

____________________

_____________

D E C I S I O N

_____________

1.  Based upon the evidence before the court, I am satisfied that the Originating Summons (“the OS”), the supporting affirmations and the notice of this hearing have been duly served on the defendant (“D”). D has not filed any notice of intention to defend, and D has not filed any evidence in opposition to the plaintiff (“P”)’s application. In the circumstances, the facts in P’s case, which are supported by the evidence filed by P, are deemed to be proved.

2.  Having considered P’s evidence and the submissions made by Mr Vincent Chiu, counsel for P, I am satisfied that P is entitled to have judgment based upon resulting trust. The evidence shows that the initial purchase price and all the mortgage repayments were paid by P. Further, regarding the initial contribution of HK$100,000 from D, P has repaid the same to D in late 2004, upon the request made by D. That being the case, P should be regarded as the sole beneficial owner of the Property by resulting trust. This would be sufficient for granting judgment to P.

3.  Mr Chiu also submits that P should be entitled to have judgment based upon common intention constructive trust. With respect to counsel, I am unable to reach this conclusion.

(1)  As to whether there was a common understanding between P and D at the time of the acquisition of the Property that P should be regarded as the sole beneficial owner of the Property, I am of the view that there is insufficient evidence on this point. Even according to P’s case, there was no express agreement to that effect at the time of the acquisition of the Property. Further, in view of the initial contribution of HK$100,000 from D (which, in my view, cannot be regarded as nominal contribution), and in view of the fact that P and D were registered as the owners of the Property, holding the Property as joint tenants, I am unable to infer that there was a common intention between the parties that P should be regarded as the sole beneficial owner at the very beginning.

(2)  I accept that in late 2004, after P repaying the HK$100,000 to D, there was a common intention between P and D that P should be regarded as the sole beneficial owner of the Property. However, it is unclear what detriment P has suffered by relying upon this common intention. Mr Chiu submits that the detriment suffered by P is the continuous operation of the Dispensary on his own at the Property, and paying the outgoing building management expenses. With respect, continuously using the Property for commercial purpose cannot be hardly regarded as a detriment suffered by P. Further, there is no difference before and after 2004, ie P was operating the Dispensary at the Property both before 2004 and after 2004. Since P is the one using the Property and P is an owner of the Property, it is natural for him to pay the building management expenses. In my view, there is no sufficient evidence showing the P has suffered detriment by relying upon the common intention formed in late 2004.

4.  Notwithstanding that P is unable to succeed by relying upon common intention constructive trust, I would allow P’s claim for P has made out a case on resulting trust.

5.  P has said something in relation to the handling of the conveyancing matters of the Property by Messrs Woo Kwan Lee & Lo (“WKLW”). For avoidance of doubt, I make no comment on those matters. WKLW have not been given notice of these proceedings. As a matter of fairness, in respect of anything said by P concerning WKLW, the court has not made any ruling and has no comment on those matters.

6.  I make the following order:

(1)  Order in terms of §§1-2 of the OS

(2)  Order in terms of §3 of the OS, subject to the following amendment:

At the end of the paragraph, adding “within 28 days after the service of this Order, and the conveyancing costs incurred be borne by P”;

(3)  In the event that D has failed or neglected to perform § 3 of the Order, a solicitor in the firm representing P in these proceedings be appointed and authorized to execute the documents as stated in §3 of the Order, and the costs be borne by D;

(4)  Liberty to apply;

(5)  Costs of these proceedings be to P, and be summarily assessed at HK$100,000.