MASSMUTUAL ASIA LTD v. LO PUI SUN

DCCJ 5029/2001

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 5029 OF 2001

-----------------------

----------------------

----------------------

JUDGMENT

----------------------

1. The Plaintiff is a company incorporated in Hong Kong and carries on the business of life insurance and sets up, manages and carries out retirement scheme contracts.

2. The Plaintiff entered into an agreement dated 13 September 1999 between itself and the Defendant (“the Agreement”) wherein the Plaintiff appointed the Defendant and the Defendant agreed to act as a Designate Senior Branch Manager of the Plaintiff at the level of DG3 to perform his obligations and duties set out in the Agreement subject to the terms and conditions of the Agreement.

3. In this action the Plaintiff claimed the Special Allowance paid to the Defendant pursuant to the Memorandum on Special Allowance for Designate Senior Branch Manager dated 13 September 1999 (“the Memorandum”) which was due to be repaid (under the terms agreed) upon the termination of the Agreement within a period of 60 months from the commencement of the Agreement (see para 3 (c) of the Statement of Claim).

4. The Plaintiff obtained Summary Judgment on the 18^th May 2004 from H.H. Judge To against the Defendant on the aggregate sum of the Special Allowance paid to the Defendant over the period of the Defendant’s appointment.   The written Judgment of H.H. Judge To is at pages 314 to 320 of the Bundle of Documents.

5. This judgment concerns the Counterclaim filed by the Defendant in respect of this Action.

The Counterclaim

6. The Defendant’s counterclaim relies on these grounds:

1.	He alleges that he was decoyed into signing the Agreement and the Memorandum with the Plaintiff by misleading inducement from the Plaintiff’s staff that he should focus on his team business or group business only and did not have to work on his personal business.  The Plaintiff decoyed him by pandering to his greed by the offer of the Special Allowance, which blinded the Defendant to the Plaintiff’s plot.   He therefore focussed on developing his team business.   He used the Special Allowance received each month on entertainment expenses to build up his team business and failed to develop his personal business. Because he had zero personal business performance, the Plaintiff dismissed him. Thus, he spent all the Special Allowance he received.
2.	He alleges a plot by his up-line Manager, Mr. Mendel Ng, or even the Senior Vice President, Mr. Manly Cheng to dismiss him when his team had grown mature enough to secure their own business on their own, so that they could take over the “overrides” which should be receivable by the Defendant.
3.	His family inheritance was reduced.   He referred to the estate of his late mother consisting of the property 4/F, No. 1 Nam On Lane, Hong Kong of which he had 1/5th share.    He stated that as a result of a Charging Order, entered against the 1/5 share of the Defendant after default judgment (subsequently set-aside on his application) was obtained against him, his siblings sold the property to avoid trouble.    The sale was expedited as a result of pressures contained in a letter dated 11th January 2002 from the Plaintiff’s solicitors Messrs. Lau Chan Ko to Mr. Lo Pui Hong the executor of the Defendant’s late mother’s estate.   This letter contained a demand that the executor pay to the Plaintiff the sum owed by the Defendant to the Plaintiff failing which the Plaintiff would apply to the Court for an order for sale of the said property to recover the amount owed by the Defendant secured under the Charging Order (this letter is at page 549 of the Bundle of Documents).   The sale was at an inappropriate time for subsequently, a few years thereafter, the Government offered to compulsorily purchase properties in that location at several times the price at which the property was sold by his siblings.   He claims compensation for this.
4.	He claimed damages for the consequences of the bad relationship between himself and his siblings, which arose from the pressure put on his siblings arising from the Plaintiff’s pursuit of the sum claimed by the Plaintiff against him. He stated that he has not only lost out on the loving relationship of siblings but any chances he may have for help by them in the future. He stated that he is likely to require liver or other organ transplant as he had ruined his health on entertainment of clients in order to build up his team.   As a result of the bad feelings between himself and his siblings arising from this litigation, his siblings are not likely to donate any of their organs to him if he needed a liver or other organs transplant.

Finding

7. In relation to the 1^st ground of the counterclaim, as submitted by the Plaintiff’s Counsel, it is clear that there are no particulars of the alleged misleading inducement.   There is no specific evidence as to whom of the Plaintiff made these inducements to him nor the time and place of such allegation.   There is also no evidence of the precise words spoken.   Further the Defendant is experienced as an insurance agent and he knowingly signed the Agreement and the Memorandum with the Plaintiff knowing full well their terms.   He must know that the written terms are binding on him.    Even were such remarks said (there is no evidence of the particulars of such remarks), it is highly unlikely he would have relied on such.    I find his evidence of such inducement to be unbelievable.  Even if there were such inducements, which I do not so find, his claim that he relied on such is unbelievable.   I reject this evidence of the Defendant.

8. The second ground of the counterclaim cannot be sustained as there is no evidence of such conspiracy.   The evidence from the Defendant’s witness Wong Siu Ngar Christina (“Ms. Wong”) at paragraphs 37 to 39 of her witness statement at page 347-8 of the Bundle of Documents show that Mr. Mendel Ng chose to transfer to the Plaintiff all benefits under any policies which were introduced by his direct downline agents that had left the Plaintiff’s appointment.   Therefore, Mr. Mendel Ng would not obtain any commission to any policies introduced by the Defendant after the Defendant left the Plaintiff’s appointment.   According to Ms. Wong, in relation to those commissions that the Defendant was entitled to receive from the policies introduced by his downline agents (commonly known as “overrides”), those commissions would normally be payable to Mr Mendel Ng upon the Defendant leaving the Plaintiff’s appointment were it not for the assignment of such to the Plaintiff by Mr. Mendel Ng.  According to the Plaintiff’s records, the amount of overrides that the Defendant had received from the Plaintiff during September 1999 to June 2000 was HK$51,705.50 (i.e. an average of HK$5,170 per month).  This is hardly a sum large enough to be the reason for a complicated conspiracy alleged by the Defendant.  In relation to Mr Manly Cheng, since he was an employee of the Plaintiff, he would not be entitled to any overrides from agents of the Plaintiff according to the company policy of the Plaintiff.  Thus, Mr Manly Cheng did not receive any overrides as alleged by the Defendant or at all.  This ground in the Counterclaim is wholly unbelievable.

9. I find that there is no evidence that there was any conspiracy of the nature alleged by the Defendant and that the allegation is incredible.  This ground fails.

10. The third ground of the counterclaim cannot be substantiated for there is no evidence from the executor of the Defendant’s late mother’s estate that the property would not have been sold were it not for the letter from the Plaintiff’s solicitors.   This allegation of the Defendant is mere speculation.    There is no evidence that the executor of his late mother’s estate would have deferred sale until the compulsory purchase offer by the Government even if there were such an offer.  There is no evidence of such compulsory purchase by the Government apart from mere allegation by the Defendant.   There is no evidence of the offer price from the Government apart from the mere allegation by the Defendant.    There is no evidence that the said property was sold at a price below market price.    Hence there is no basis for this allegation.  This ground fails.

11. Related to the fourth ground of claim, there is no evidence from the Defendant’s siblings of how they view the Defendant arising from this litigation.   The Defendant alleges that the relationship of himself and his siblings was affected.   There is no evidence of the relationship of the Defendant with his siblings prior to this litigation whether it was already not good.   There is no evidence that were the litigation not to have arisen between the Plaintiff and the Defendant, the Defendant’s siblings would have been willing to offer the Defendant their organ for an organ transplant if the Defendant needed such.    In fact, the Plaintiff is not at fault in pursuing this litigation.  They have acted pursuant to their legal rights.  There is no cause of action based on this ground of claim.  

12. Having considered the aforesaid and all other aspects of the Defendant’s counterclaim and allegation, I find that there is no basis to the counterclaim of the Defendant and I dismiss it.   I grant an order nisi for costs of the counterclaim to the Plaintiff to be taxed if not agreed with Certificate for Counsel.