YU SHEUNG CHI JANET v. HUI TSANG YIK PHILIP AND ANOTHER

HCA 332/2015

[2018] HKCFI 806

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 332 OF 2015

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JUDGMENT

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1.  This case concerns a dispute as to the beneficial ownership of:

(1) the shareholding in a company called Pacific United Development Limited, the 2^nd defendant (“PUD”), there being only one issued share, which is held by the 1^st defendant; and

(2) a residential property known as Town House 25, Car Parking Spaces 53 and 54, The Yard, Open Ground and the Garden (if any), Shatin Knoll, No 83 Ma Ling Path, Shatin, New Territories, Hong Kong (“the Property”) which is held by PUD.

2.  The plaintiff is Yu Sheung Chi Janet.  Her case is that the 1^st defendant is holding the share in PUD on trust for her, and that PUD is holding the Property on trust for her.

3.  The 1^st defendant is Hui Tsang Yik Philip (“Mr Hui”).  He denies that there is any trust arrangement. His case is that he is the legal and beneficial owner of the share, and that PUD is the legal and beneficial owner of the Property.  He counterclaims for vacant possession of the Property and mesne profits.

THE TRIAL

4.  The trial took place over six days.  The parties filed written opening submissions, and written closing submissions in which they set out the factual findings they asked the court to make.  I express my appreciation to counsel in that respect.

5.  At the opening of the trial, though the plaintiff was listed as a witness in her written opening submissions, it was explained on her behalf that she would not in fact be attending.  The court was told that her father died recently, and the plaintiff has to look after her mother.  The court has not therefore heard from the plaintiff at this trial.

6.  Three witnesses were called on behalf of the plaintiff:

(1) Mr Cheng Joi Kuen Kenny (“Mr Cheng”) who is the plaintiff’s husband;

(2) Dr Yeung Sai Kit (“Dr Yeung”) who is a friend of the plaintiff and Mr Cheng;

(3) Mr Lee Ka Chun who is a friend of the plaintiff and Mr Cheng and a former employee of PUD and Mr Cheng’s previous business. 

7.  The plaintiff signed the Statement of Truth to her pleadings.  She also filed a witness statement which is to be disregarded in view of her non-attendance at trial.

8.  Mr Yip Wai Ming (Duncan Yip) who was the Managing Director of a finance company called Glory Sky Finance Limited also gave a witness statement for the plaintiff, and was listed as a witness in the plaintiff’s written opening submissions.  He did not attend trial either, and his witness statement is also to be disregarded.

9.  Mr Hui gave evidence.  The defendants did not call any other witnesses.

10.  In their oral evidence, all the witnesses sought to assist the court as best they could.  Both Mr Cheng (who in the absence of the plaintiff was the key witness on her side), and Mr Hui, have medical conditions, and both have suffered recent bereavements, for which allowance has to be made in the giving of their evidence.

11.  The defendants attack the credibility of Mr Cheng on the basis primarily that (with the exception of one email dated 9 January 2015) no documents were produced on the plaintiff’s side.  Thus she produced no documents relating to her assertion that she funded the purchase of the Property by PUD and thereafter paid the mortgage instalments.

12.  Even after making proper allowances for his health problems, Mr Cheng did not appear to have a firm grasp of the payments passing to and fro in this case.  He said that he had not seen many of the relevant documents before, and frequently said that he could not comment on them.  The reason that the plaintiff produced no documents, he explained, is that she no longer has access to PUD’s documents following Mr Hui’s assumption of control over the company which happened in February 2015.

13.  While I accept that this would make the plaintiff’s task more difficult, it should have been possible to do something to piece together the funds flow that she says took place.  Some of PUD’s financial documents were disclosed in the discovery process, and more could have been applied for by way of specific discovery.  PUD’s bank statements could have been cross-checked against her own bank statements, and supporting documents obtained to show the payments that she says she made, as the defendants did in respect of their case.  The same applies to the assertion that money was paid into PUD by her daughter’s company.  This action is brought by the plaintiff on the basis that she made the payments, and she must prove her case.  An explanation given by Mr Cheng in cross-examination as to his wife’s secret vault of cash was not convincing.  I agree with the defendants that Mr Cheng’s failure to deal adequately with this issue in his evidence reflects adversely on his credibility generally.

14.  The plaintiff submits that Mr Hui was on many occasions during his oral testimony evasive, and constantly switching his evidence, which shows that he is an incredible witness whose evidence should not be accepted by the court.  Again, after making proper allowances for his medical condition, I consider that Mr Hui’s evidence was vague, tended not to focus on the questions being put to him in cross-examination, and on a number of issues changed over the course of cross-examination.  I have been unable to accept his evidence in some significant respects, preferring that of Mr Cheng on particular issues.  However, his evidence was supported by the documentary record in a way which Mr Cheng’s evidence was not.  Overall, I consider Mr Hui to be the more credible witness.

15.  There was considerable documentation as to contracts, company forms, and the like as well as payments contained in the trial bundles.  But although the parties said that they used emails, texts, WhatsApp, etc, in their communications with each other, there was only one such communication in evidence, which is the email produced by the plaintiff.  There was limited opportunity therefore to test the conflicting assertions of the witnesses against what they said to each other in messages at the time.

16.  There was an agreed composite table of all pleaded payments by the plaintiff and defendants respectively stating the purposes, dates, and amounts ordered at the PTR on 15 December 2017 by Au-Yeung J.  This was amended at the beginning of the trial by the plaintiff.  It was the point of reference for all the payments dealt with in the evidence/submissions at trial.  With a few exceptions, the payments themselves were not in dispute, though the parties differed as to whether the payments were funded by the plaintiff or by Mr Hui.

17.  So far as the claim for mesne profits is concerned, the parties agreed a joint expert report on the monthly rental, and it was not necessary to call the experts to testify at the trial. 

THE PLAINTIFF’S CASE

18.  The plaintiff’s case is essentially that the parties’ common intention when they entered into the relevant transfers was that both the share in PUD, and through PUD, the Property, were to be held on trust for her, as she says it had been all along.  Her case is that she made the down payments on the purchase of the Property, and serviced the mortgage payments. 

19.  Her case is that she and her husband (Mr Cheng) ran a garment business through the Great Pacific Group of companies, which went into liquidation in 2010.  The plaintiff through PUD continued the garment business with the expertise and assistance of Mr Cheng, who himself became bankrupt in September 2010. 

20.  The plaintiff and Mr Cheng originally acquired the Property, which was their matrimonial home, through a company they jointly owned known as Prosfer Company Limited.

21.  Mr Hui was a good friend of the couple.  He has been operating a wholesale business of ginseng and antler tonic in the name of Wing Tak Hing Hong.  In about 2011, the plaintiff (with the assistance of Mr Cheng) and Mr Hui, together with Dr Yeung and Eddie Lei (who was Mr Hui’s brother in law) agreed to cooperate in a project regarding an ecological park or ginseng farm in Jilin Province in the mainland.

22.  The shareholding in PUD was held in the name of a friend Ho Ling Ki (“Michael Ho”) for the plaintiff.  Michael Ho wanted to cease this arrangement.  The share in PUD was duly transferred to Mr Hui, who now held PUD on trust for the plaintiff, as Michael Ho had previously.

23.  As Mr Cheng had been adjudged bankrupt, in order to avoid unnecessary challenge from the trustee in bankruptcy, PUD purchased the Property from Prosfer.  In effect, it was a refinancing of the Property.

24.  The plaintiff’s case is that the costs of acquisition and the repayment of the mortgages were from her, and that Mr Hui holds PUD, and PUD holds the Property, on trust for her.  Her case is that she provided the purchase money for the Property, and that there is accordingly a presumption of a resulting trust in her favour.

25.  Her case is that PUD had become a “costs defraying centre” for the parties’ business and the Jilin project.  However, the project became a total loss.

26.  The payments made by Mr Hui and/or WTH were in fact for the project, not for the Property.  If any of the payments provided by Mr Hui and/or WTH were for the Property, the plaintiff says that they were shareholder loans to PUD and/or loans to the plaintiff and/or Mr Cheng.

27.  The plaintiff pleaded that Mr Hui and PUD were in breach of their fiduciary duties and/or breach of trust by obtaining a second mortgage over the Property without her knowledge, and that Mr Hui was also liable for dishonest assistance and knowing receipt, and was in further breach of his fiduciary duties and/or breach of trust by interfering with the operation of PUD and causing the value of its share to diminish.  Given the lack of evidence, the plaintiff accepts that the diminution in the value of the share would be nominal, and this part of the claim was not pursued.

28.  The plaintiff claims, inter alia, for declarations that Mr Hui holds the share in PUD on trust for the plaintiff, and that PUD holds the Property on trust for the plaintiff, and for orders that Mr Hui transfers the share in PUD to her, and that PUD transfers the Property to her.

THE DEFENDANTS’ CASE

29.  The defendants’ case is essentially that the parties’ intention when they entered into the relevant transfers was that Mr Hui should become beneficial owner of the business, and through PUD, beneficial owner of the Property.  His case is that he made the down payments on the purchase of the Property, and serviced the mortgage payments.

30.  Mr Hui says that he came to know Michael Ho in about June 2011 through Mr Cheng.  He says that Mr Ho told him that his garment business carried on in the name PUD was suffering a loss and that he did not have sufficient capital to continue, but that someone with enough working capital could turn the business around and make a profit. Ho offered to sell the share in PUD at a nominal consideration of $1 on condition that Mr Hui would keep all existing staff (so that Ho did not need to pay severance payments).

31.  At that time, Mr Hui said that his business Wing Tak Hing Hong was good and generated a stable cash inflow, and he had some experience in the garment business.  After consulting Mr Cheng, he agreed to take up the PUD share from Michael Ho at consideration of $1.  He became its only director.  According to the balance sheet, PUD had no meaningful assets and had a loss of some $1.8 million at the time of acquisition in September 2011.

32.  Since Mr Hui was the real owner of PUD, all its monthly overheads and working capacity were provided by him by way of shareholder loan.  According to the balance sheet as at 31 December 2014, PUD owed a director loan of more than $14 million to Mr Hui.

33.  He says that he acquired the Property through PUD in his own right using his own money.  According to him, in around September 2011, Mr Cheng told him that DBS (the mortgagee bank) intended to sell the Propertyto recover the outstanding loan of $34 million.  Mr Cheng asked him whether he was interested in buying the Property as the value should be more than the loan, and he did decide to buy it.  He made all the down payments, the balance of $29 million being raised by loans from Hang Seng Bank and Glory Sky Finance.  He also paid the monthly instalments and overdraft interest on the loans, and denies that the plaintiff made any contribution to the instalments or interest.

34.  His case is that Wing Tak Hing Hong had set up a Sino–Foreign Equity Joint Venture business in Jilin in 1999 which he intended to list in Hong Kong.  He says that Mr Cheng represented himself as a professional accountant with experience in listing and offered to help on a complimentary basis.  However, he denies that PUD was used as a so-called “costs paying centre”.  His case is that the project is wholly irrelevant to the subject matter of the present case, as was a separate loan from Fu Tat Credit Limited.

35.  Apart from the initial contribution for down payments, Mr Hui and Wing Tak Hing Hong contributed no less than $19 million from January 2012 to March 2015, whereas the total mortgage instalments were about $16 million during the same period.

36.  Since he did not hold the share in PUD in trust and the Property was not held in trust, it is Mr Hui’s case that he was entitled to close the business because he was the beneficial owner.  He counterclaims for vacant possession of the Property, and mesne profits from April 2012, alternatively from 5 March 2015 up to the date of delivery of vacant possession.

37.  In the event that the court finds that he is holding the share on trust for the plaintiff, Mr Hui alternatively seeks a declaration that the plaintiffis holding the Property through PUD on trust for Mr Hui by reason of the fact that he and/or Wing Tak Hing Hong paid the purchase price of the Property and the mortgage instalments.

THE LAW

38.  There has been no dispute as to the law, and the defendants did not challenge the principles set out in the plaintiff’s written opening submissions.  There was no suggestion that there was any difference between the principles applying to the Property (that is, the house in Shatin) and the share in the company (that is, PUD).  The starting point is that the legal owner of property also has beneficial ownership of the property, unless the contrary is shown (see eg Lee Tso Fong v Kwok Wai Sun [2008] 4 HKLRD 270 at §23).  Here, the plaintiff relies upon a resulting trust and/or a constructive trust to make good her claim to beneficial ownership.

39.  So far as resulting trust is concerned, the principle in its classic form has been stated as follows: “… where a person purchases property with his own money and directs that the property be transferred to the name of another, in the absence of evidence to the contrary, there is a presumption that the property is held by the person to whom it is transferred under a resulting trust in favour of the person who provided the money for its purchase.  The law imputes a common intention in the parties to hold the property under a resulting trust even in the absence of such intention.  This presumption may be rebutted by proof of the actual common intention of the parties.” (see Lee Tso Fong v Kwok Wai Sun,ibid, at §5; see also the formulation in Westdeutsche Landesbank Girozentrale v Islington LBC [1996] AC 669 at 708–9).

40.  In the present case, the plaintiff’s submission is that she providedthe purchase money for the Property, and that there is therefore a presumption of a resulting trust in her favour.

41.  Should the court find that the defendants paid any money towards the purchase price of the Property, the plaintiff submits that such money was paid by them as lenders and not as purchasers, and that consequently they have no beneficial interest in the Property.

42.  Where a contribution of money is by way of loan, again the legal principle is not in dispute: see eg the Court of Final Appeal in Big Island Construction (HK) Ltd v Wu Yi Development Co Ltd (2015) 18 HKCFAR 364 at §§44 and 47, Tang PJ, and §§91 – 97, Sir Anthony Mason NPJ, and Unionward Investment Ltd v Yeung Foon Tai HCA 136/2016, unreported, 20 April 2017, DHCJ Paul Lam SC.  It is summarised in Underhill and Hayton, Law Relating to Trusts and Trustees (19^th ed, 2016) at §25.14:

“ Where the purchase money is provided by a third party at the requestof and by way of loan to the person to whom the property is conveyed there is no resulting trust in favour of the third party, for he did not advance the purchase-money as purchaser, but merely as lender.”

43.  The principles as to constructive trust, and its relationship with resulting trust, are the subject of the recent decision of the Hong Kong Court of Appeal in Primecredit Ltd v Yeung Chun Pang Barry [2017] 4 HKLRD 327.  The case arose in the domestic context, where there has been significant modern case law concerning the property rights of unmarried couples in their home.

44.  In the Primecredit case, the property was the matrimonial home which had been put into the joint names of the husband and the couple’s son.  Upon the husband’s death, it passed to the son.  The issue of ownership arose when a finance company sought to enforce a charging order against the property in relation to a loan which the son had taken out with it. The question was whether the wife had a beneficial interest in the property, in which she had continued to live following her husband’s death.

45.  Differing from the judge below, the Court of Appeal held that she did have such an interest, either by way of resulting trust, or (in the view of the majority) a common intention constructive trust. On the latter point, Kwan JA disagreed, on the basis that the judge was entitled to conclude that the evidence of an arrangement or understanding was so nebulous that on the balance of probabilities there was no common intention.

46.  The applicable principle was expressed by Lam VP at §1.6:

“ Since Stack v Dowden [2007] 2 AC 432 and Jones v Kernott [2012] 1 AC 776, as far as Hong Kong is concerned, the modern approach on constructive trust is to assess the common intention of the parties by a holistic approach having regard to the context, see Mo Ying v Brillex Development Ltd [2015] 2 HKLRD 985. In a domestic context, particularly in relation to a matrimonial home, the court is not constrained in that exercise by pure direct monetary contributions to the purchase price, see the judgment of Baroness Hale at [69] in Stack. In a Chinese setting, especially for the older generations, where explicit discussions on property rights within the family are not that common, the court has to pay more regard to circumstantial matters.”

47.  The plaintiff argues that the present case also arises in the “domestic context”, so that the same approach applies.  This argument was based on the fact that Mr Cheng and Mr Hui referred to each other as “brothers”. However, their friendship was brief, and arose in a commercial context.  The holistic approach must be applied “having regard to the context”, and in my view this is not a domestic type of case as it has generally arisen in the authorities.

48.  As Cheung JA stated in Primecredit at §2.15, “In ascertaining the beneficial ownership of a party who provided the purchase price of a property acquired in another person’s name, the issue of financial contribution is clearly a most weighty consideration.”  Kwan JA made observations to similar effect at §§27 – 28, as did Lord Walker in Stack v Dowden, ibid, at §33, when commenting specifically on the situation where parties are in a commercial as well as an emotional partnership.  In the present case, I find that the relationship was commercial in nature, and in that context the question of who actually paid for the property in dispute is likely to be a central one. 

49.  In Primecredit, at §2.3, Cheung JA sets out the two limbs of common intention constructive trust:

“ 2.3. The first situation where common intention constructive trust may arise is where at any time prior to acquisition, or exceptionally at some later date, there is an agreement, arrangement or understanding reached between the parties on how the property is to be held beneficially.

2.4. The second situation is where there is no evidence to support a finding of an agreement or arrangement on the beneficial ownership of the property and the court must rely entirely on the conduct of the parties both as the basis from which to infer a common intention on the beneficial ownership of the property and as the conduct relied on to give rise to a constructive trust.  In this situation, direct contributions to the purchase price by the party who is not the legal owner, whether initially or by payment of mortgage instalments, will readily justify the inference necessary to the creation of a constructive trust.  See the judgment of Lord Bridge of Harwich in Lloyds Bank Plc v Rosset [1991] AC 107, 132.”

50.  In the present case, the plaintiff relies on both limbs.

THE FACTS

51.  Upon the totality of the evidence, the facts as I find them are as follows.

The collapse of the Great Pacific Group and the formation of PUD

52.  From the 1980s on, Mr Cheng built up a substantial garment business in the name of the Great Pacific Group, with manufacturing facilities on the mainland.  His wife, the plaintiff in these proceedings, was also involved in the business.  The business started to go downhill after 2005, and his companies went into liquidation in 2010.  His own personal bankruptcy followed a few months later in September 2010 (the exact dates are not in evidence).  He is presently an undischarged bankrupt.

53.  The Property is a substantial house in Shatin. It was acquired by Mr Cheng and his wife as their family home through a company called Prosfer Company Ltd (“Prosfer”) at a price of HK$21.88 million in 1995.  He and his wife jointly own Prosfer, and it is not suggested that the company held the Property otherwise than as beneficial owner.

54.  After the collapse of the Great Pacific Group, Mr Cheng in effect tried to continue his business on a smaller scale through Pacific United Development Ltd, that is, PUD, which was incorporated in April 2010.  He says that the business was carried on by his wife, helped by their daughter Jessie.  But although I accept that the plaintiff played an active role (particularly as regards PUD’s biggest customer who was said to live in San Diego), the main actor was Mr Cheng himself.  In closing submissions, the plaintiff asserts that Mr Cheng was “heavily involved” in the business.

55.  A group of former employees followed the business into PUD.  According to Mr Cheng, Mr Lee Ka Chun (who gave evidence for the plaintiff at trial) was the General Manager of PUD, and Ms Moon Tsui was the plaintiff’s personal assistant.  I think it more likely that Moon Tsui was the general manager, but there is no dispute that she was the authorised signatory of PUD’s accounts, and it makes no practical difference.  I accept Mr Cheng’s evidence that because the staff were experienced in the business, it continued to run smoothly.

56.  In April 2010, so around the time of the collapse of the Great Pacific Group, the plaintiff’s family moved to the United States, and now live in California.  It is not in dispute that Mr Cheng continued to spend much time in Hong Kong, and continued to use the Property.  The plaintiff also visited Hong Kong from time to time.

57.  On 8 June 2010, the shares of the plaintiff and Mr Cheng in Prosfer were transferred to a company called Noble Crown Construction Ltd.  According to Mr Cheng, Noble Crown was to hold the share in Prosfer on trust for the plaintiff (Cheng soon became bankrupt and it is said that his share was taken over by the plaintiff). Thus, it is said, there was no change in the beneficial ownership of Prosfer or the Property.  

Mr Hui’s ginseng and antler business and the Jilin Project

58.  Turning to the 1^st defendant, Mr Hui has carried on a long established family ginseng and antler wholesale business called Hong Kong Wing Tak Hing Hong (“WTH”), which is a partnership between him and his wife.

59.  It is clear from the pleadings and the written evidence that an important part of the background in this case is an enterprise in Jilin Province that Mr Hui had been pursuing for some time, and in which Mr Cheng became involved himself after the two men got to know each other.

60.  According to the Defence, in 1999 Mr Hui and his friend Mr Nei “set up a Sino-Foreign Equity Joint Venture business under the name of ‘吉林巿隆泰參茸製品有限責任公司’ in the Jilin Province (吉林省) of the People’s Republic of China (‘the JV Company’).  Both the 1^st defendantand Mr Nei have all along intended to list the JV Company on the Hong Kong Stock Exchange.”

61.  It is not in dispute that Mr Hui and Mr Cheng were first introduced to each other in 2011.  According to the Statement of Claim, Mr Hui told Mr Cheng that he had an investment in an ecological park or ginseng farm in Jilin Province which was under the Jilin Longtai group owned by Mr Nei (聶先生).  The investment was rather limited, but if they could procure the listing of the company holding the project on the Hong Kong Stock Exchange, “the ecological park or ginseng farm occupying a very vast area in Jilin could on IPO fetch a value as high as tens of billions”.

62.  Whilst Mr Hui was expert in the ginseng and antler business, he had no experience of listing public companies. Mr Cheng offered his services in this regard.  Mr Cheng says, and there is no reason to doubt, that he did a considerable amount of work on the project at considerable expense. However, by September 2014 it was clear that the project would not get off the ground.  Mr Hui felt that he had been let down and misled, and relations with Mr Cheng soured, and their relationship soon came to an end.  The hope or expectation on the part of those involved in this case that they would make a lot of money out of the Jilin project came to nothing.

The incorporation of PUD and the transfer of the share to Michael Ho

63.  Mr Cheng says, and there is no dispute, that at the time he was adjudged bankrupt in 2010, the Property was subject to a mortgage in favour of DBS Bank (Hong Kong Ltd) which then seems to have been owed some $41 million. 

64.  Mr Cheng says that “in order to avoid unnecessary argument or challenge by the trustees in bankruptcy over our matrimonial home, Janet decided to acquire the same from Prosfer to be held in the name of PUD”.  There was some cross examination as to what exactly he meant by this, but I am not asked to make any findings of fact in that regard.

65.  PUD was incorporated on 23 April 2010, and on 20 July 2010 Michael Ho became the sole shareholder and director of the company taking over from Cheng Mei Yin, who is said to be Mr Cheng’s cousin.

66.  Mr Cheng says that there was no financial involvement or execution of documents in this respect.  He says that Michael Ho held PUD on trust for Janet, and had no involvement in the business which he and Janet continued to run.  He says that Mr Ho was prepared to do this because they had been good friends for almost 30 years, and they trusted him.

67.  Mr Hui’s case on the other hand is that Mr Ho did carry on the garment business.  He says that Ho told him that he was carrying it on in the name PUD, that it was making a loss, that he did not have sufficient capital to continue, but that someone with enough working capital could turn the business around and make a profit.  Mr Hui says that Ho offered to sell the share in PUD to him at a nominal consideration of $1 on condition that Mr Hui would keep all existing staff (so that Mr Ho did not need to pay severance payments), and seeing a good business opportunity, Mr Hui agreed.

68.  Michael Ho has not given evidence.  There is no document supporting Mr Cheng’s version of the facts.  Equally there is no document to suggest that Mr Ho made any financial contribution to PUD’s business, or indeed had any connection with it other than as sole shareholder and director.  Had there been such a document, I have no doubt that the defendants would have produced it.

69.  In the absence of any supporting material, I have to choose between two different accounts by Mr Cheng and Mr Hui.  It is noticeable that the defendants’ closing submissions do not seek any findings of fact on this issue.  On balance, I find that Mr Ho held the share in PUD as nominee for Mr Cheng and/or the plaintiff.  I do not think that he was carrying on the business on his own account and reject Mr Hui’s evidence to the contrary.

The plaintiff’s case as to how Mr Hui took the place of Michael Ho as trustee

70.  According to Mr Cheng, and I accept this, Mr Ho wished to be relieved of his share and directorship.  Dr Yeung was approached to take over, but refused.  It was at this point in time, that is in the first part of 2011, that Mr Cheng first met Mr Hui, and the two men rapidly became close friends.

71.  The plaintiff’s case is that Mr Hui agreed to become trustee of the share in PUD in place of Mr Ho.  This is denied by Mr Hui, who says that he bought the business.  This is an important factual issue.

72.  The plaintiff relies on Mr Cheng’s oral evidence to the effect that in a “casual gathering” the couple asked Mr Hui if he could hold the share in PUD on trust for the plaintiff in place of Ho, to which Hui agreed.  She further relies on the oral evidence of both Mr Cheng and Dr Yeung that subsequently, in the office of PUD, Cheng explained to Yeung in front of Hui and Michael Ho that Hui had agreed to be the trustee in place of Ho.

73.  In that regard, Dr Yeung’s evidence came in oral examination in chief.  He said that at a meeting in the house at Shatin (ie the Property) he was asked by Janet (the plaintiff) to take over from Michael Ho. Having given it some thought, he declined, and Janet said that she would contact Mr Hui instead.  After a week or so, a meeting took place at PUD’s office which included Mr Hui.  Dr Yeung said that Mr Cheng told him that he had had discussions with Mr Hui, who was going to hold the share on trust for Janet.  He was asked whether anything was indicated to the effect that Mr Huidid not want to be trustee, and he said that there was nothing to his recollection. 

74.  All this is denied by Mr Hui, and the court has to assess which version of events to accept. 

75.  The defendants submit that if Dr Yeung’s evidence is true, this meeting at PUD’s office must be the occasion on which Mr Hui openly indicated his agreement to replace Michael Ho as a trustee of the share on behalf of the plaintiff.  This is a very important piece of evidence, and it is difficult to understand, they submit, why Dr Yeung failed to mention it in his witness statement, saying only that, “Subsequently, due to Michael Ho’s personal reason, his share in PUD was transferred to Philip Hui and there was a change of trustee/nominee of Janet Yu, who remained the beneficial owner of PUD”.  It is even more difficult, the defendants submit, to explain why Mr Cheng, who was allegedly present at the meeting, failed to mention it in his witness statement at all.

76.  I approach this on the basis that there is nothing inherently implausible in the plaintiff’s case given my finding that Michael Ho did in fact hold PUD as nominee.  It also is right to say that there were omissions from Mr Hui’s witness statement that were highlighted in cross examination, and there is a limit to the weight that can be placed on that factor.

77.  Nevertheless, I agree with the defendants that an explanation of how Mr Hui agreed to hold the Property in trust for the plaintiff was to be expected.  The evidence of the plaintiff’s witnesses in this respect was not strong in my view.  There are no documents in support of the plaintiff’s account—Mr Cheng says that this is because at the time, the trustees in bankruptcy were pressing hard not only against him, but against Janet.

78.  I prefer Mr Hui’s evidence in this regard, and do not accept the account given by Mr Cheng and Dr Yeung.  There is a considerable body of evidence set out below which supports this conclusion, as does the evidence in respect of the source of the funds for the transfer of the Property. 

The transfer of the PUD share from Michael Ho to Mr Hui on 28 September 2011

79.  It is not in dispute that on 28 September 2011 Michael Ho transferred his share in PUD to Mr Hui, who also replaced Mr Ho as PUD’s only director.  There is a dispute as to whether Mr Hui actually proffered the $1 which was the contractual consideration for the transfer, but nothing turns on that.  The dispute as to whether he took the share as trustee for the plaintiff, or, as he claims, as purchaser of the business, is tied in with the agreement to transfer the Property from Prosfer to PUD.  This was entered into a few weeks later on 12 October 2011.  On the plaintiff’s case, PUD holds the Property on trust for her, and it is not the company’s asset.

80.  In support, Mr Cheng says that he and the plaintiff had put a lot of effort into the garment business over 30 years, that it was never her intentionto give up ownership of PUD.  He says that it is unbelievable that they would be willing to do so.  He says that Mr Hui had no experience in the garment business, and that following the transaction, he rarely appeared in PUD’s office.

81.  Although Mr Hui denied this, I accept the evidence of Mr Cheng and Mr Lee that his visits to the office were relatively infrequent, and that his experience in the garment business went back many years, and was of a peripheral nature.  I also accept Mr Cheng’s evidence that Mr Hui was mainly involved in his WTH business and with the Jilin project, and mainly worked in WTH’s office.

82.  I accept the plaintiff’s point that severance payments would not need to have been made had Michael Ho let the business go. It is common ground that PUD was operating at a loss at the time of the transfer, and I also accept that Mr Hui was unable to say in cross-examination precisely how he expected to be able to turn the business around after he acquired it.

83.  At the same time, I accept Mr Hui’s evidence that he did participate in PUD’s operations even if not on a day to day basis. Further, the balance sheet up to 31 December 2014 shows a director’s loan to PUD of $14,570,474, and he was the only director.  In cross-examination he said that the expenditure covered a wider scope than that pleaded in the Defence, but the amount of the loan was not challenged.  I find that Mr Hui injected substantial sums of money into the business.  This is an important point, because it is inconsistent with him being merely a trustee of the business for the plaintiff. 

84.  A further important question is as to why the plaintiff says that PUD was put into Mr Hui’s name instead of holding it herself (see Suen Shu Tai v Tam Fung Tai HCA 1466/2010, 15 August 2012, Mr Recorder H Wong SC).  Mr Cheng’s explanation, and the plaintiff’s case, is that reality and efficiency were the reasons.  Because she moved to the USA in April 2010, and was not always in Hong Kong, it would be difficult for her to sign cheques and contracts.

85.  However, as the defendants point out, it is the director, not the shareholder, who signs contracts and cheques on behalf of the company.  In any case, Ms Moon Tsui was the authorized signatory of PUD’s accounts at the material time.  In my view, no valid reason has been advanced as to why the share should have been registered in the name of Mr Hui to hold on trust for the plaintiff.

86.  Also, I do not accept that it was never the plaintiff’s intention to give up ownership of PUD.  In her absence at trial, the assertion of her intention cannot be tested.  But even if she hoped, or intended, to remain the beneficial owner of PUD, or perhaps gave it little thought at the time of the transfer when much wealth was anticipated from the Jilin project, the question for the court in deciding the plaintiff’s claim concerns common intention.

The 28 September 2011 financial statements

87.  Another potentially important point arises from the company accounts.  There is an Income Statement for PUD from 29 April 2010 (which is the date the company was incorporated) up to 28 September 2011, and a Balance Sheet as at 28 September 2011, being the date of the transfer of the share from Mr Ho to Mr Hui.

88.  The Income Statement shows the company operating at a loss after administrative expenses are taken into account, and the Balance Sheet is also in the red.

89.  However, the main relevance of this evidence is that no financial statements as at the date of transfer should have been prepared at all.  The defendants submit that there can have been no purpose in preparing financial statements if, as the plaintiff claims, the transfer by Mr Ho to Mr Hui was merely from one nominee to another, and was of no substantive effect.

90.  The plaintiff sought to meet this by pointing out that reference is made in the Defence to audited accounts of PUD as of 28 September 2011.  There are audited accounts for the period from 29 April 2010 to 31 December 2010, but these are dated 21 May 2012, and it is submitted that it is apparent that the Income Statement and Balance Sheet were prepared after the transfer, and so could not have been relied on by Mr Hui.

91.  However, as the defendants say, this point is not open to the plaintiff.  Mr Cheng effectively accepted the contemporary status of the documents in cross examination.  When challenged as to why they were necessary, he said that financial statements were prepared up to the date of transfer as a natural step and that he did not see why it should not be done.

92.  I find that these financial statements are contemporary documents prepared in order to show the state of the company’s accounts at the time of the transfer of the share to Mr Hui.  There is no suggestion that such financialstatements were prepared on the previous transfer of the share from Mr Cheng’s cousin to Michael Ho.  This suggests that this was a business transaction, rather than a private arrangement between friends.  The financial statements support the defendants’ case that Mr Hui was a real purchaser of PUD, who needed to learn about the company’s financial position when taking it over, and who was not taking the share in the company simply as a trustee for the plaintiff.

The transfer of the Property to PUD

93.  Shortly after the transfer of the share in PUD from Michael Ho to Mr Hui, the Property was transferred from Prosfer to PUD. The same question arises as in the case of business.  The plaintiff says that the parties intended that she should be the beneficial owner of the Property, whereas the defendants say that PUD was to be the beneficial owner.

94.  There was evidence that Mr Hui thought that the Property might be worth more than the price of $34 million that was going to be paid for it, but nothing in my view turns on this.

95.  Mr Cheng’s evidence is that it was his bankruptcy that caused disruption to the enjoyment of the Property by his family.  He says that the plaintiff had a sentimental regard for the Property having lived there since 1995 and raised her family there.  I accept this, though noting that by now the plaintiff had moved to the United States. 

96.  The plaintiff’s case is that prior to the signing of the SPA, the plaintiff, Mr Cheng, Dr Yeung and Mr Hui had a discussion, during which Mr Hui was informed of the trust arrangement that PUD was to hold the Property on trust for the plaintiff through the SPA and a refinancing arrangement.  Mr Hui was asked if he could cause PUD to perform the arrangement and he agreed.  However, the evidence as to this discussion is much the same as that described already in relation to the share, and is not strong.

97.  Mr Cheng said that the reason the plaintiff acquired the Property in the name of PUD was so as to obtain facilities from the bank.  This might make sense if she funded the acquisition as she says she did, though as the defendants point out, if the share in PUD itself was being held on trust for the plaintiff, there seems little reason for an arrangement by which PUD held the Property on trust for her.

98.  The plaintiff says that since Mr Hui considered that PUD was at the time worthless, it would also be illogical for him to have the Property registered in the name of PUD instead of another company.  I do not accept this point.

99.  The plaintiff says that if PUD was really the owner of the Property,the defendants would not have allowed the plaintiff and her family to stay there for so many years.  However, this is not a particularly weighty point, since she was asked to leave in February 2015.

100.  There is further evidence relied on by the plaintiff which is potentially important.  Mr Cheng and Dr Yeung gave evidence as to a meeting at the office of Glory Sky Finance Ltd at which Mr Hui was present to discuss a proposed mortgage loan. They say that Mr Duncan Yip, who was the Managing Director of the company, was concerned about the identity of the true owner of the Property, and was told that the plaintiff was the beneficial owner of PUD and the Property, and that Mr Hui raised no objection on hearing this.

101.  However, as noted above, although Mr Yip gave a witness statement in support of the plaintiff’s case, and was listed in her opening submissions as a witness, he did not attend the trial.

102.  Glory Sky Finance Ltd was advancing a substantial sum on the security of the Property, and I agree with the defendants that if Mr Yip had been concerned about the identity of the owner of the Property, and been told that it was the plaintiff, he would at least have asked for written confirmation that she agreed to the loan.  He would not have allowed his company to execute a mortgage document by which PUD charged the Property as “beneficial owner”.  I cannot accept the evidence of Mr Cheng and Dr Yeung in this regard. 

The SPA for the Property made on 12 October 2011

103.  It is not in dispute that on 12 October 2011, a Sale and Purchase Agreement was entered into in respect of the Property by Prosfer as Vendor and PUD as Purchaser at a price of $34 million, the completion date being 20 April 2012.  The SPA was signed on behalf of Prosfer by Mr Edward Ng of Noble Crown which by now (as explained above) owned the shares in Prosfer, and Mr Hui on behalf of PUD.

104.  The sum of $34 million was what was required to repay the DBS mortgage at that time (though Mr Cheng said that DBS was not pressing for the loan to be repaid).  This was more, or not less, Mr Cheng says in his witness statement, than the market value of the Property.

105.  The money was raised by:

(1) down payments in the sum of $6 million (according to the plaintiff)or $5 million (according to the defendants) which were paid over the period from entering into the SPA to completion;

(2) mortgage loans paid at completion from:

(i) Hang Seng Bank (“HSB loan”) in the sum of $11.3 million pursuant to an offer letter dated 26 March 2012; and

(ii) Glory Sky Finance Limited (“GSF loan”) in the sum of $18 million pursuant to a loan agreement made in April 2012.

106.  The parties’ dispute is primarily as to who made the down payments and who serviced the mortgages.  In short, the plaintiff says that all relevant payments were made by her, and Mr Hui says that all relevant payments were made by him.

The payment documents

107.  I have already referred to the documents relating to the payments, and to the agreed composite table of all pleaded payments ordered at the PTR on 15 December 2017 by Au-Yeung J.  The pleaded payments were particularised in three schedules to the Defence, and PUD’s bank statements were disclosed by way of discovery.  The documents relied on by the defendants to show that Mr Hui made the payments are in the trial bundles. By contrast, and as the defendants put it, “The Plaintiff is unable to produce a single piece of paper to show that she had actually paid any money into PUD throughout the years.”

108.  It is correct that despite the obvious importance of the payments issue, only the defendants have produced any documents.  As explained above, the plaintiff could have done so, and since she brings the action on the basis that she made the payments, the onus was on her in that respect.  The issue as to payments is also important because it is the part of the case which allows the assertions of the witnesses to be judged against contemporary documents.

The down payments

109.  The plaintiff’s case is that she settled the down payments in the sum of $6 million.  The defendants’ case is that the down payments were in the sum of $5 million and were paid by Mr Hui. 

110.  In the evidence, a convenient starting point is a letter dated 9 September 2013 from Anthony Siu & Co, a firm of solicitors, sent to the auditors of Prosfer (ie the vendor).  The firm had acted for PUD (ie the purchaser) in the transaction.  This shows the amount of the deposit as $5 million paid in tranches prior to completion on 20 April 2012.

111.  There is no reason not to accept the letter.  I find that the amount of the deposit was $5 million as the defendants say.

112.  There is then the question of who paid this sum.  The payment documents show that Mr Hui drew a cheque for $1 million dated 27 September 2011 in favour of the plaintiff.  The letter from Anthony Siu & Co shows an initial deposit of $1 million, and the reasonable inference is that this was paid by way of Mr Hui’s cheque.  There is no evidence that this was a loan to the plaintiff as is suggested on her behalf.

113.  That left a total of $4 million to be paid by way of down payments.  On 29 September 2011 Mr Hui drew a cheque for $1 million payable to PUD, and on 3 October 2011 Mr Hui drew a cheque for $4 million payable to PUD.  These sums were duly credited to PUD’s account, which had previously held only a small balance.

114.  A cashier order in the sum of $2 million was issued on behalf of PUD in favour of DBS Bank (Hong Kong) Ltd—ie the mortgagee—on 13 October 2011.  It is correct, as the plaintiff points out, that Schedule 3 of the SPA shows $3 million as paid prior to its execution, but all this shows is that $2 million was paid one day late. That does not alter the fact that it was paid out of the $5 million provided by Mr Hui.

115.  I find that the remaining $2 million was paid over the next few months in accordance with the details set out in the letter from Anthony Siu & Co by four cheques each for $500,000 drawn on PUD’s account dated 26 October 2011, 28 November 2011, 30 December 2011, and 20 January 2012.  It was clearly paid from the money previously paid in by Mr Hui. 

116.  The payment documents speak for themselves in this respect.  There is no evidence that the plaintiff deposited any money with PUD, and I reject her case that she was the source of the funds.  I find that $5 million was deposited for the purchase of the Property and was paid by Mr Hui.  The sum of $5 million was not a loan from Mr Hui to the plaintiff or to Mr Cheng.

117.  This finding is inconsistent with the plaintiff’s resulting trust claim which is based on her funding the transaction.  It is also inconsistent with the plaintiff’s case that there was a common intention that the Property should be held for her beneficially.  I do not accept that case on the facts, and there is further evidence set out below that supports that conclusion.

The repayment of the DBS mortgage and the guarantees of the HSB and GSF loans

118.  The HSB and GSF mortgages were executed, and the loans were disbursed, on completion of the sale on 20 April 2012, allowing the balance of the DBS mortgage to be repaid on that date.

119.  It is not in dispute that Mr Hui, Mr Hui’s wife and Dr Yeung were guarantors of the HSB loan, and that Mr Hui and Dr Yeung were guarantors of the GSF loan.  The plaintiff on the other hand gave no guarantee (and Mr Cheng was bankrupt and so could not do so).

120.  I agree with the defendants that it is not credible that Mr Hui and his wife would have undertaken this personal liability if the plaintiff was the beneficial owner of the Property as she says.  The guarantees in my view provide strong support for the conclusion that Mr Hui was the true owner of PUD and that the Property belonged to PUD.

121.  I further agree with the defendants that Dr Yeung had a commercial incentive to help Mr Hui because he was participating in the Mr Hui’s Jilin project at the time and hoped to make a considerable amount of money from it, though in the end that did not happen. 

The subsequent mortgage repayments

122.  It is not in dispute that the monthly repayments of HSB and GSF loans were in fact made by or on behalf of PUD: ie, the mortgages did not go into arrears.  As appears below, these mortgages were discharged about a year later, and replaced by a mortgage and loan from CITIC Bank.

123.  The plaintiff’s case is that she deposited money into the accounts of PUD to settle the monthly mortgage instalments with the assistance of Ms Moon Tsui and Mr Cheng.  She says that any payments which Mr Hui made to PUD for the purchase price of the Property were loans to the plaintiff.  In short, all the payments were made by her.

124.  The defendants’ case is that the monthly repayments were settledby Mr Hui with his own money.  In short, all the payments were made by him. 

125.  Again therefore, as with the down payments, the parties put forward diametrically opposed cases.  The documentary evidence in this regard comes from the payment documents.  As before, only the defendants have produced any documentary evidence.

126.  The monthly repayment of the GSF loan was $290,000 and the monthly repayment of the HSB loan was $56,034.  Some of the repayments can be followed through, and I am satisfied that the documents show that Mr Hui or WTH (which as noted was a partnership between him and his wife) was the source of about seven of the monthly repayments to GSF over about a twelve-month period and a part repayment of $4,500,000 made in December 2012.

127.  The documents show that Mr Hui or WTH was the source of about five of the monthly repayments to HSB over about the same twelve-month period (after which the loans were repaid and the CITIC loan taken out).

128.  These payments were made by cheque, bank transfer and cash. The December 2012 payments, for example, which were the largest payments made in any single month, were made out of a transfer of $5,000,000 from WTH’s account with Hang Seng Bank into PUD’s account with Hang Seng Bank on 17 and 18 December 2012 respectively.

The CITIC mortgage and loan

129.  It is not in dispute that on 12 April 2013, PUD borrowed $30 million from China CITIC Bank International Ltd.  In this case, WTH and Mr Hui acted as guarantors.  The observations made above in regard to Mr Hui’s personal liability under the HSB and GSF guarantees apply equally in respect of this guarantee liability.

130.  On 3 May 2013, the HSB and GSF mortgages were discharged, and PUD executed a mortgage in favour of CITIC.

131.  The documents show repayments of the CITIC loan/overdraft interest by Mr Hui or WTH on 31 July 2013, 5 August 2013, 4 December 2013, and 3 January 2014.  To take the last of these as an example, on 2 January 2014 WTH transferred $200,000 to PUD’s account with HSB.  This was used to settle PUD’s monthly repayment of the CITIC loan in cash in the sum of $150,472 the following day.

132.  Since the time the parties’ relationship came to an end in January 2015, the defendants have been paying the CITIC mortgage instalments. Mr Hui’s evidence to this effect was not challenged.

Conclusion as to the mortgage repayments

133.  The plaintiff submits that Mr Hui deliberately chose to deposit cash so that one would not be able to trace the payments, many of which werein fact made by the plaintiff.  However, cash payments constitute a relatively small proportion of the overall payments.  In any case, I accept Mr Hui’s evidence to the contrary, and the cash payments considered at trial can all be traced back to the accounts of Mr Hui or WTH.  Although there may be force in the plaintiff’s point that no separate ledger was kept by WTH, this does not alter the fact that the WTH payments came from Mr Hui as partner.

134.  There is no documentary evidence to support Mr Cheng’s evidence (and the plaintiff’s case) that she deposited money into the accounts of PUD to settle the monthly mortgage instalments with the assistance of Ms Moon Tsui and Mr Cheng, or that the couple’s elder daughter Jessie made payments into PUD through GPIL, or that the payments made by Mr Hui/WTH were loans to the plaintiff.  I reject her case in that respect.

135.  It is important to make clear that the defendants have not established the funds flow in respect of all the mortgage payments falling due. However, they have established the funds flow in respect of a considerable number, and the plaintiff has established none.  Although the defendants cannot trace the payments directly to Mr Hui/WTH for each month, on balance, I find that the documented examples are sufficient to show that Mr Hui paid all (or at least most) of the monthly instalments of the various mortgage loans with his own money.  He had every reason to ensure that the instalments were paid since he was guaranteeing them.

136.  The plaintiff’s case is that Dr Yeung deposited $3 million into PUD in 2011 and $1.25 million in August 2014, and she relies on the fact that in the email of 9 January 2015, Mr Hui referred to interest being payable to Dr Yeung.  These deposits are not found in PUD’s bank statements, but in any case, even if the payments were made, the payments do not in my view affect the above conclusions.

137.  Although I accept the plaintiff’s submission that money was paid into PUD’s accounts for various purposes including the garment business and the Jilin project, as well as for the mortgage repayments, I do not accept her case that PUD was a “costs paying centre”, or that the use of the accounts in this way affects the above conclusions.

138.  Although I accept the plaintiff’s submission that repayments of a loan made on 12 November 2012 (by which the defendants and Dr Yeung and his wife borrowed $13 million from Fu Tat Credit Ltd) were made through PUD’s accounts, this does not affect the above conclusions either.

The end of the relationship and the email of 9 January 2015

139.  Towards the end of 2014, the parties’ relationship and the hopes placed in the Jilin project had come to an end.  Although (as the plaintiff says) Mr Hui’s evidence was not consistent in this respect, I am satisfied that Mr Cheng held out the prospect of a “white knight” coming to the rescue of PUD, which was heavily indebted, and no longer viable.

140.  The email that Mr Hui sent to Mr Cheng on 9 January 2015 is, I find, Mr Hui’s response to that suggestion.  Both sides have relied on the terms of the email to support their case.

141.  In it, Mr Hui says that he made instalment payments, that he paid for some legal fees of Mr Cheng, and the cost of maintaining PUD, and a loan to Eddie Lei (his son-in-law).  All this came to $65 million, on which interest was running in excess of $400,000 a month including bank loans.  The income from PUD’s garment business, he said, was only sufficient to meet part of the staff payments, and not enough to cover rent and other expenses.  There were, he said, only two feasible solutions. One was that a white knight took over all the debts and the business, and the other was that the Property was sold, and the proceeds used to repay the banks, the balance to repay himselfand Eddie Lei.  He said that a solution had to be found before 31 January 2015.  

142.  The plaintiff submits that Mr Hui was not offering to sell the business as his own, but was asking Mr Cheng to repay loans. She submits that the email supports her case that Mr Hui was only a trustee, whilst she and Mr Cheng had been taking care of the Property and the business of PUD.  The email shows that Mr Hui was accounting to Mr Cheng for his expenses, she submits, rather than as owner of the business.

143.  The defendants submit that the email does not sit well with the plaintiff’s case.  Mr Hui asserts he had been paying monthly repayments since November 2011 and that he had been paying money to maintain PUD’s operations.  He expressed his concern about the viability of the garment business all of which is inconsistent with the plaintiff’s case that he did not participate in it.  If Mr Hui was a trustee, he would not need to be bothered whether Mr Cheng was able to find a white knight to take over PUD and the Property.

144.  In my view, the email does not decisively support either party’s case.  On balance, it is more consistent with the defendants’ case, because Mr Hui appears to be asserting his right to act as owner if no solution is forthcoming.  It gives no indication of any common intention that he is holding the share in PUD as a trustee for the plaintiff.

145.  No solution was forthcoming, and the business was closed down by Mr Hui in February 2015.  The writ was issued by the plaintiff on 12 February 2015, and the Property remains unsold.

CONCLUSION

146.  In the plaintiff’s submission, there is clear evidence that at the time of the transfer of the share in PUD and the sale and purchase of the Property, the common intention of the plaintiff and Mr Hui (in his own capacityand on behalf of PUD) was that the plaintiff would be the beneficial owner ofPUD and the Property.  In turn, the parties would participate in the Jilin project. It was thus a win–win situation.  Alternatively, taking a “holistic approach” as in the cases of Stack v Dowden and Jones v Kernott, and considering all the circumstances of the case, the plaintiff invites the court to infer such common intention.  It is apparent from the evidence that at the time Mr Cheng and Mr Hui were very close friends as if they were brothers, and given the trust the couple had in Mr Hui, they did not see the necessity of putting the trust arrangement in writing.

147.  Further, the plaintiff submits that taken to its highest, the documentary evidence produced by the defendants is only neutral.  Coupled with the various false allegations made by Mr Hui, it is submitted that this is positive evidence in support of the plaintiff’s case that she settled the purchase price and all monthly mortgage instalments for the Property, either through payments by herself or through loans from Mr Hui, Dr Yeung and/or Eddie Lei. 

148.  In these circumstances, the plaintiff invites the court to find that she is the ultimate beneficial owner of the share in PUD and the Property.

149.  For all the reasons set out in detail above, I am satisfied that it was not the common intention of the parties that the plaintiff was to be the beneficial owner of PUD and the Property, nor can such common intention be inferred.  I am satisfied that Mr Hui bought PUD as owner and thereafter put considerable money into it by way of director’s loan as the company’s accounts show.  Equally, as regards the Property, for all the reasons set out in detail above, I reject the plaintiff’s case that she settled the purchase price and subsequent mortgage instalments.  I am satisfied that these were paid by Mr Hui, as the payment documentation shows, and that the monies were not paid by way of a loan.

150.  It follows that the plaintiff’s case both in resulting and in constructive trust fails, and that the claim fails.  I find that Mr Hui is holding the share in PUD as both the legal owner and beneficial owner, and that PUD is holding the Property as both the legal and beneficial owner.

151.  Vacant possession of the Property must now be given.  As to the claim for mesne profits, in light of the parties’ agreement on the expert evidence, I need only make a finding as to the period from which liability accrues.  In this respect, I hold that liability accrues from 5 March 2015, the date on which Mr Cheng and the occupiers of the Property were given notice by solicitors’ letter of 6 February 2015 that they had to leave the Property.  It continues up to the date of delivery of vacant possession.  The parties should agree the figures.

152.  On the basis that costs follow the event, I will make an order nisi that the plaintiff is to be liable for the defendants’ costs to be taxed if not agreed.