NGAI FEW FUNG v. CHEUNG KWAI HEUNG

HCMP 1186/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1186 OF 2006

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REASONS   FOR   DECISION

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1.  This action is listed for trial before me on 24 June 2008.  At the pre-trial review on 30 April 2008, the Defendant indicated that she wished to run arguments based on her alleged contribution to the subject property at the trial.  Since those matters were not raised in her pleaded Defence and Counterclaim, this court directed that if she wished to run such arguments, she had to apply for leave to amend her Defence and Counterclaim.

2.  The Defendant accordingly made an application for leave to amend.  However, instead of filing a summons seeking leave, she mistakenly filed an Amended Defence and Counterclaim on 6 May 2008.  As explained to her on 15 May 2008, she had yet to obtain leave to amend and she should issue a summons seeking leave instead.  She understood that to be the position though she said she had not been told of the correct procedure to apply for leave by the Resource Centre for Unrepresented Litigants. 

3.  The Plaintiff’s solicitor was prepared to deal with the application for leave to amend on 15 May 2008.  Given the imminence of the trial, it is undesirable to defer the hearing of the application.  In the circumstances, instead of wasting costs and time to require a formal summons to be issued, this court heard the application for leave to amend on 15 May.

4.  After hearing submissions, I refused leave to amend.  I now give reasons for my decision.

5.  The proposed amendment is to add a new paragraph 15 to the Defence and Counterclaim to allege contribution to the property by the Defendant.  This allegation is inconsistent with the original defence case as pleaded in the same document.  The original defence is based primarily on the allegation that the property was a gift from the Plaintiff.

6.  The dispute between the Plaintiff and the Defendant has a chequered history as summarized in the judgment of Deputy High Court Judge Muttrie on 13 February 2007 dealing with the Defendant’s striking out application.  The striking out application was dismissed and the dismissal was upheld by the Court of Appeal in CACV 147 of 2007, 7 December 2007.

7.  As pointed out by Judge Muttrie, the case of gift from the Plaintiff had been decided against the Defendant by Judge Chan in DCCJ 2331 of 2004 (an action between the same parties) and the Defendant cannot run the same case again in this action.

8.  As held by Judge Muttrie and the Court of Appeal, the judgment in DCCJ 2331 of 2004 does not bar the Plaintiff from seeking a partition or an order for sale under the Partition Ordinance. 

9.  Further, notwithstanding the pleaded case, the Plaintiff conceded before the Court of Appeal that he is content with a 50-50 distribution of the net proceeds of sale if a sale were ordered by the court, subject only to an additional reimbursement for 50% the mortgage instalment payments made by him since the issue of the present originating summons. 

10.  At the same time, counsel for the Defendant (she was then legally represented) informed the Court of Appeal that the Defendant would not raise any issue of contribution. 

11.  It was on such bases that the Court of Appeal considered the appeal in CACV 147 of 2007 and permitted the action to go ahead for trial.  That being so, it would not be right to allow a late amendment to permit the Defendant to renege from her position taken before the Court of Appeal.  This is sufficient to dispose of her application for leave to amend.

12.  Moreover, the Defendant had not explained by affirmation how she could credibly run a case of contribution when she had previously testified in DCCJ 2331 of 2004 on the basis of a case of gift.  The two contentions are factually inconsistent with each other. 

13.  In any event, based on what I have heard, the Defendant’s case of contribution for more than 50% is not a strong one.  While she had made some mortgage payments and paid for some expenses relating to the property, one must bear in mind she had the exclusive benefit of the use and occupation of the property all these years. 

14.  The major item in her proposed amendment is what she pleaded in her new paragraph 15 as money lent to the Plaintiff in the total sum of $2,107,300.  Even taking the allegation on its face value, it does not represent her contribution to the property.  The fact that she had lent money to the Plaintiff does not mean that such money had been used on the acquisition of the property.

15.  When this was pointed out to her, the Defendant tried to say that such money were repayments to the Plaintiff on account of the Plaintiff’s contribution to the property.  I cannot accept such oral explanation by way of submission and the figure simply does not square with the amount contributed by the Plaintiff.

16.  It also transpired that the allegation of loan to the Plaintiff was raised in another action, viz. HCA 1454 of 2006, in which the Defendant is the plaintiff and the Plaintiff is the defendant.  It is difficult to understand how the Defendant could sue the Plaintiff for this sum if the money were repayment to the Plaintiff for his contribution to the property.  Anyway, that action is still ongoing though for quite some time the Defendant has not taken further steps to pursue it due to lack of funds.

17.  In my judgment, the question of loan (which I understand to be disputed by the Plaintiff) has no relevance to the case of contribution.  If the Defendant wishes to pursue it, she should do so in the context of HCA 1454 of 2006. 

18.  Disregarding the loan amount, it is difficult to see what mileage the Defendant could attain from her case of contribution over and above the 50% interest in the net sale proceeds conceded by the Plaintiff (subject to the adjustment regarding mortgage payments after 14 June 2006).

19.  Such a late amendment would jeopardize the trial dates since the Plaintiff would need time to respond to the same with further evidence. 

20.  Hence, even without taking into account of the concession by Defendant’s counsel to the Court of Appeal, I would have exercised my discretion against granting leave for such late and fundamental amendment. 

21.  I do not see any justification for departing from the usual way of dealing with costs.  Since the Defendant failed in her application, she must pay the costs of the Plaintiff for the application for leave to amend in any event.