POON YUET CHUN v. TSE SO KWAN

HCA 8006/93
HCA 4133/94

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 8006 OF 1993

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(Consolidated pursuant to Order dated 23 December 1994)

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JUDGMENT

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1. This case has been described by counsel for the Defendant as a family tragedy. It is a matter of opinion whether the facts warrant that portrayal, but it is unfortunate that two families who have shared happier, albeit poorer, times together, should have to face each other in Court with mutual recriminations such as the ones that the Court has heard in this trial.

2. The respective cases of the Plaintiff and the Defendant are markedly different. The facts go back more than 2 decades, and there are few contemporaneous documents. It may therefore be helpful to briefly set out each side's version first, before proceeding to determine the issues relevant to this judgment.

The parties

3. Tsang Cheung and Tsang Hing Kai are cousins. Their fathers were brothers. However, Tsang Hing Kai was brought up on the mainland by Tsang Cheung's mother, and the two regarded themselves as more brothers than cousins. Tsang Cheung (who is now in his 60's) is the elder by about 10 years or so.

4. Tsang Cheung was the first to arrive in Hong Kong, where he became a building and decoration contractor. He married the Plaintiff.

5. Tsang Hing Kai arrived in Hong Kong in the 1960's. When he first arrived, Tsang Cheung looked after him, buying him some clothes and shoes, and he stayed with Tsang Cheung and the Plaintiff for about 5-6 months. He then stayed in a shop where he was apprenticed. He also became a building and decoration contractor.

6. In 1970, Tsang Hing Kai married the Defendant - an indigenous villager from Sai Kung.

The land

7. In 1971, the Defendant's father gave her a piece of agricultural land in Sai Kung in Kap Bin Long Village, Sha Kok Mei. By a surrender and re-grant, the Defendant was permitted in 1972 to build a house on the land. It is this piece of land (and the 2-storey house erected on it) which is the subject-matter of the present action.

The agreement

8. The Plaintiff's case is simple. She and her husband Tsang Cheung gave evidence that in or about 1973, the Defendant asked them for a loan for construction costs of the house. (The Defendant, Tsang Hing Kai and their son Tsang Chi Lung who had been born in 1971 were then living in another house, next to the land where their house was being built).

9. The Plaintiff's family had been saving up to get a bigger flat, and so they were not able to lend the Defendant the amount of money that she had requested.

10. Tsang Cheung then had the idea that they could combine resources, with the Defendant contributing the land, and he contributing the money for construction costs, and the house and land could then be shared by the two families.

11. I pause to note that it is well-known that a typical village house in the New Territories is restricted to 3 storeys with a floor area of 700 sq ft for each storey.

12. The Plaintiff's case is that the two couples then met, and at this discussion Tsang Hing Kai said that a 3-storey house could be built for $20,000, which Tsang Cheung found acceptable. Tsang Cheung's evidence was that between March and May 1973, he gave $8,000 to Tsang Hing Kai who had been undertaking the construction.

13. Tsang Cheung's evidence was that when he found $8,000 was sufficient for only 1 storey, he realised that $20,000 would not be enough for the 3-storey house envisaged, and he wished to abandon the project.

14. After discussion, it was decided that they would continue the joint venture, but on the basis that only 2 storeys would be built. It was further agreed that the land would be owned equally, and the Defendant and her family would occupy the lower storey, and the Plaintiff and her family, the 1st floor.

15. In due course, Tsang Cheung gave Tsang Hing Kai the balance of $12,000 to finish construction.

Visit to solicitors

16. Tsang Cheung was conscious of the need to have the agreement for the shared ownership of the land documented by solicitors, and through a friend, he contacted a clerk called Cheung Ka Chai ("K.C. Cheung") at H.M. So & Co., a firm of solicitors with an office in Central District. On 4 June 1973, Tsang Cheung paid $500 to H.M. So & Co. as money on account.

The Chinese Document - 9 July 1973

17. The Plaintiff's case is that by July 1973, the construction was more or less completed, and on advice from the solicitors' firm, Tsang Cheung asked the Defendant to go to the solicitors' office with her title deeds to sign the necessary document. An appointment was made for 9 July 1973.

18. The Plaintiff met the Defendant (who was by herself) on Hong Kong Island, where Tsang Cheung then took them to H M So & Co's office.

19. There the Defendant handed over the title deeds to the clerk K.C. Cheung who took the title deeds into a separate office, and later emerged with a document written in Chinese which was then read over to the Defendant. The Defendant was asked if she understood, and she said she did. The document was then signed by the Plaintiff and the Defendant.

20. The original of this Chinese document has recently been retrieved from H.M. So & Co. and has been produced as exhibit "P-1".

21. It recites the receipt from the Plaintiff of a sum of HK$20,000 being consideration for the purchase of a half share of the land registered in the Defendant's name situate at DD 221 Lot 1778 together with the right to use the 1st floor of the premises to be erected on the land. It also stated that once the "occupation permit" had been issued, the completion of the agreement should be immediately proceeded with. It was signed by the Defendant under the words "Owner Receiver" followed by her identity card number, and signed by the Plaintiff under the words "Purchaser Payer" followed by her identity card number, and the document was dated 9 July 1973.

The title deeds

22. According to the Plaintiff and Tsang Cheung, the original Chinese document and the title deeds were retained by the solicitors pending completion of the agreement upon issue of the certificate of compliance (referred to as the occupation permit).

23. The Plaintiff and the Defendant were however each given a copy of the Chinese document.

Occupation

24. The Defendant and her family moved into the house first, occupying the ground floor, and later that year (1973), the Plaintiff and her family moved into the 1st floor.

25. The internal partitioning on the 1st floor was undertaken by the Plaintiff's family, and other substantial works were done, such as the tiling of the bathroom and kitchen, the demolition of part of one wall for access to the balcony, and the erection of railings around the 1st floor balcony. The fact that these works were done at the Plaintiff's family's initiative and expense is common ground between the parties.

Plaintiff's acquisition of title deeds

26. The Plaintiff's case is that although Tsang Cheung did subsequently ask the Defendant from time to time to complete the formalities at the solicitors office, the Defendant did not do so.

27. By 1974, Tsang Cheung was asked by K.C. Cheung to take back the title deeds which had been kept at H.M. So & Co. and to retain them in order to protect the Plaintiff's interests, since the Defendant had been unwilling to complete the agreement. The original of the Chinese document was however retained at the solicitors firm.

28. The Plaintiff's family has kept the title deeds to the property throughout, although since the start of this action, they have been placed in the custody of the Plaintiff's solicitors.

Events in 1991

29. This state of affairs continued until 1991, when according to the Plaintiff's case, a visit from the Defendant's brother to the Plaintiff prompted the Plaintiff and Tsang Cheung to make another attempt to get the Defendant to complete the agreement. The Defendant agreed.

30. Tsang Cheung then contacted H.M. So & Co. again, now known as So & Company. The clerk K.C. Cheung had died by then. Tsang Cheung was told to arrange for the Plaintiff and Defendant to go to the office for the execution of an assignment.

31. The two couples did attend the office of So & Co. in 1991, only to be told that the firm did not have copies of the title deeds, and that the Chinese document was missing. Tsang Cheung provided copies of these documents to the solicitors firm, and they then left.

32. Tsang Cheung said that he was later contacted by the solicitor Mr So, who said that the assignment was now ready for execution. However, when Tsang Cheung asked the Defendant to go to the solicitors firm again, she did not do so.

Plaintiff's Letter of demand and Reply from Defendant's solicitors

33. Eventually in March 1993, Tsang Cheung and the Plaintiff instructed So & Co. to write to the Defendant demanding execution of the assignment. There had also been registered against the property a Receiving Order made in Tsang Hing Kai's bankruptcy, and in its letter, So & Co. also required that the Receiving Order be discharged.

34. On 6 April 1993, the Defendant instructed Woo & Woo, a firm of solicitors, to reply to So & Co.'s letter of demand. This was a detailed 4-page letter which sets out what presumably was the Defendant's side of the story. The contents of this letter will be referred to in greater detail in this Judgment.

Lock-out

35. The correspondence between solicitors was followed by growing manifestations of hostility. The Plaintiff and Tsang Cheung gave evidence of how they were locked out by the Defendant and her family, and how the police had to be called to the scene on a number of occasions. The Plaintiff also alleged that Tsang Hing Kai had threatened her family's safety.

Disposal of Plaintiff's articles and occupation by Defendant's family

36. In November 1993, the Plaintiff and Tsang Cheung moved out of the 1st floor to live at their son's house in the vicinity. As they had left furniture and belongings behind, an arrangement was made through the respective solicitors for the Plaintiff and her family to return to the 1st floor to collect some personal properties.

37. On 24 March 1994, the Plaintiff and her family collected some, but not all, of their properties. An inventory of the articles taken away, and of those left behind, was made and sent by the Plaintiff's solicitors to the Defendant's solicitors.

38. On 26 March 1994, however, some of the articles of the Plaintiff's family which had remained in the 1st floor premises were removed and burnt outside the house. Tsang Cheung gave evidence that the articles burnt included his bed, as he saw a corner of the headboard.

39. The Defendant and Tsang Hing Kai do not dispute that some of the Plaintiff's family's properties had been burnt. They say that what was left by the Plaintiff and her family was broken, so they regarded it as rubbish. Tsang Hing Kai acknowledged that he had burnt some articles, but that some other articles remained. He also accepted that the 1st floor has since been used by his family.

40. As a consequence of those events in 1994, the Plaintiff issued another action viz. HCA 4133/94 claiming, amongst other reliefs, damages for trespass of the 1st floor premises and for damages for conversion of various chattels.

Defendant's case

41. The Defendant's case is markedly different from the Plaintiff's. Evidence was first given by Tsang Hing Kai and then by the Defendant. Their evidence can be summarised chronologically as follows.

Events in 1971 - conversation about finances

42. In 1971, Tsang Hing Kai and the Defendant were living in Mongkok, when their son Chi Lung was born. The Defendant's father gave her a piece of land for them to build a house.

43. In cross-examination, Tsang Hing Kai said that it was back then in 1971, when having tea with Tsang Cheung and another friend at a cafe in Chai Wan, that he first mentioned to Tsang Cheung the financial aspects of the construction of the house. He had not asked Tsang Cheung for a loan. He had simply mentioned that his finances were tight.

44. Tsang Hing Kai said that was the first time that Tsang Cheung mentioned that it would be good if the Defendant could let him have a floor to live in. Tsang Hing Kai said he immediately told Tsang Cheung that the land was the Defendant's dowry, and that it would never be sold to anyone (even though Tsang Cheung had not mentioned sale). There was no further mention of his finances thereafter.

45. Tsang Hing Kai first started construction of the house in 1972. His family then moved to a house next to the site.

June 1973 - Tsang Cheung's loan of wooden boards and $500 gift

46. By April 1973, the structure of a 2-level house had been completed, but Tsang Hing Kai had run out of money. His testimony in Court was that he then borrowed some money from the Defendant's sister, but not from Tsang Cheung or the Plaintiff.

47. By about June 1973, Tsang Hing Kai and his family had moved into the house. Tsang Cheung came to see him one day and (apparently without anything to prompt it) said he would support him to build a 3-storeyed house. Tsang Hing Kai was unable to explain why Tsang Cheung did that:- he (Tsang Hing Kai) had not mentioned a 3rd storey to Tsang Cheung, and he already had to borrow money to build the 2-storey house which was still in a spartan state, so he had no intention of building a 3rd storey.

48. A few days later, Tsang Cheung came to the site with a truckload of wooden boards for formwork, which boards were borrowed from a third party company. Tsang Hing Kai accepted the loan of the boards and put them aside.

49. Tsang Hing Kai also testified that Tsang Cheung had stuffed some money into his pocket, which he treated as a gift. In Tsang Hing Kai's evidence, there was some inconsistency as to the number of occasions when a sum of $500 was stuffed into his pocket - at first, his evidence was that there was only 1 such occasion, later he said that there were 3-4 such occasions.

Tsang Cheung's procurement of title deeds

50. The Defendant said in her evidence that on 5 July 1973, Tsang Cheung came to her home and asked her for the title deeds of the house, on the ground that he would find out from a friend who could read English whether a 3-storeyed house could be built on the land. The Defendant did not explain why she accepted that reason when she had no intention or ability to build a 3rd storey.

51. That evening, the Defendant told her husband Tsang Hing Kai, who said there was nothing to read, and that Tsang Cheung should give the title deeds back to her.

52. Tsang Hing Kai's evidence was that he told his wife to telephone Tsang Cheung to ask for the title deeds to be returned. He did not find out whether she did so or not.

The Chinese document

53. The Defendant said that in the morning of 9 July 1973, Tsang Cheung asked her to go to Hong Kong Island to retrieve the title deeds as he was not free. She said she did as she was told, and because there was no-one to look after her son Chi Lung, she took him along. She was pregnant at the time.

54. They arrived at the designated bus stop where she met the Plaintiff and Tsang Cheung. Tsang Cheung took them to an office in a building where they met a man. The Defendant said she was scared, as she was only in her early 20's and she had received only a few years schooling.

55. Tsang Cheung told her that if she signed a document she could get her title deeds back. She saw that the document contained only the words :-

"茲收到

本人名下座落在西貢 KAP PIN LONG LOT NO. 1778 D.D. 221"

("Received
the land registered under my name and situated at Kap Pin Long Lot No. 1778 DD221 Sai Kung")

56. As she saw the details of her lot, she signed the document. She also alleges that she trusted Tsang Cheung because he was her elder. On that basis, the defence of undue influence was raised.

57. She accepts that the signature appearing on exhibit "P-1" was her signature, but her case is that when she signed the document, it only contained the words set out in the paragraph above. She says that she had not brought her identity card, and does not know why the number appeared on P-1.

58. After she signed the document, the Plaintiff, Tsang Cheung and the man left the room. After she waited about 15 minutes, her son was getting restless, so she checked to see that there was no-one around, and left hurriedly. Even though she had gone there to retrieve her title deeds, she left without taking any documents.

Evening of 9 July 1973 - telephone conversation

59. That evening, the Defendant told her husband about what had happened that day. Tsang Hing Kai's evidence was that he was very angry, and immediately telephoned Tsang Cheung to demand an explanation. Tsang Cheung said nothing had happened. When Tsang Hing Kai asked about the title deeds, Tsang Cheung asked him what proof he had that he (Tsang Cheung) had taken the Defendant's title deeds. Tsang Hing Kai said that he did not then know what to say, although he believed his wife's version of the events that day.

60. Tsang Hing Kai's evidence was that he then told Tsang Cheung that whatever Tsang Cheung had deceived the Defendant into signing that day, the house was not for sale as it was her dowry. He said Tsang Cheung said nothing had happened, but if there was anything wrong, he was sorry. It was left at that.

English document

61. In cross-examination, however, Tsang Hing Kai said that that evening, the Defendant had given him an English document saying it was a deed. Tsang Hing Kai said he knew it was not a deed, because it did not have a Government chop, but had the name of solicitors. He said he tore it up without asking anyone what it said. Later in cross-examination however, he said he tore it up after having asked a student who knew some English to read it, and the student said it was about a partnership or limited company and something being divided into two parts.

62. The Defendant said in her testimony however that she had not taken any document home at all, and the incident described by her husband never happened.

Licence to occupy 1st floor

63. According to Tsang Hing Kai's evidence, towards the middle of that month, Tsang Cheung came to see him and asked him to let him (Tsang Cheung) and his family live in the house for "2-6 years" until Tsang Hing Kai's son Chi Lung reached the age of 6 years.

64. Tsang Hing Kai said he was uncomfortable with the idea. He then asked his wife who did not say anything one way or the other. At the end of the month however, he received a letter from Tsang Cheung's mother on the Mainland asking him to let Tsang Cheung and his family stay at the house.

65. Tsang Hing Kai's evidence was that as a result of the mother's intercession, he felt obliged to let them stay, and so he and the Defendant agreed to do so, but imposed the condition that the Plaintiff and her family would have to decorate the 1st floor and would have to return the property to the Defendant in "2-6 years time" when Chi Lung reached the age of 6 years.

Between 1974-1992

66. According to Tsang Hing Kai's evidence, he asked Tsang Cheung for the title deeds again after the Plaintiff and her family moved into the house in 1974, but Tsang Cheung refused to return them.

67. Tsang Hing Kai also said that in 1977, he replaced the front door and did not give any keys to Tsang Cheung or his family, so that Tsang Cheung and his family would have to wait for his family to answer the door, but he had difficulties asking Tsang Cheung and his family to leave as Tsang Cheung's mother was still alive.

Visit to solicitors' office

68. Tsang Cheung's mother died in the early half of 1991. Tsang Hing Kai said he then put pressure on Tsang Cheung and his family by installing a gate and not giving Tsang Cheung and his family the keys, so that Tsang Cheung and his family would have to wait for the Defendant's family to open the door. This was done with a view to obtaining the return of the title deeds and getting Tsang Cheung to pay rent.

69. Eventually, according to Tsang Hing Kai, at around Christmas 1992, the two couples went to the office of So & Co.

70. At the office, a man claiming to be Mr So, a solicitor, showed them a copy of the Chinese document. Tsang Hing Kai considered it a forgery, and when the Defendant said that she had not received the $20,000, Tsang Hing Kai concluded that Mr So must have kept it, and demanded that Mr So return the money to Tsang Cheung and return the title deeds to the Defendant.

71. According to Tsang Hing Kai, Mr So denied having received the money or the title deeds, but re-assured him that no-one would put through an assignment after 20 years. Tsang Hing Kai said Tsang Cheung was in tears but said nothing. The two couples then left.

Receipt of So & Co's letter and instructions to Woo & Woo

72. Nothing further happened until March 1993 when the Defendant received a letter from So & Co requesting the Defendant to execute an assignment of a half share of the land.

73. Tsang Hing Kai and the Defendant then went to see Woo & Woo, and in due course Woo & Woo sent the letter of 6 April 1993 in reply.

Lock-out

74. It is common ground that the Defendant and Tsang Hing Kai did lock the Plaintiff and her family out of the 1st floor on a few occasions, and that the Plaintiff and her family eventually moved out to stay with their son who had a house in the vicinity.

Destruction of chattels

75. Tsang Hing Kai also accepts that other than the photographed articles at pages 44 to 49 of Bundle E, he burnt the other articles remaining in the 1st floor after 24 March 1994, allegedly because he thought they were rubbish.

76. He claimed that when the Plaintiff and her family went to pick up their belongings, he had heard some noises as if things were being broken, and after the Plaintiff and her family left, he found that their furniture had been broken up. Tsang Hing Kai admits however that his suspicion that the Plaintiff and her family had deliberately broken their own things was never referred to in the correspondence from the Defendant's solicitors to the Plaintiff's solicitors.

Decision

77. It is against the backdrop of the respective cases of the parties as summarised above that the Court has had to decide this case. Having considered all the relevant evidence, including the demeanour of the witnesses, I have no hesitation finding in favour of the Plaintiff.

78. Tsang Cheung and the Plaintiff gave their evidence in a consistent and straightforward way, and their account of the facts is supported by the Chinese document. It is also consistent with their being let into possession of the 1st floor, and their possession of the title deeds.

79. There were however three items of evidence which appeared inconsistent with their version of the facts, and although these are non-crucial matters, I have considered them carefully before finding in the Plaintiff's favour.

(i) Design of the house

80. The first item was the design of the house. There is only one front door, and that leads into a small hallway of the living area of the ground floor residence. From that hallway, the staircase leads up to the 1st floor.

81. Tsang Cheung's evidence was that there had been a louvred partition separating the hallway from the living room on the ground floor, but still, one would have thought that if the house had been intended to be built for two families, it could have been better designed to provide more privacy for the family living on the ground floor.

82. Tsang Cheung's response to this point was that they were one family, but the more likely explanation for the design lies in the timing. According to Tsang Hing Kai, he had started building the house in 1972 and he had built 2 storeys by 1973. Tsang Cheung's evidence corroborates that as he said that by 1973, Tsang Hing Kai and his family had moved to live in a house next to the site, to facilitate the construction of the house. So the likely scenario was that Tsang Hing Kai had already built the 1st level before he found he had run out of money and had to ask Tsang Cheung for a loan. Having started off the construction as a one-family house, it is not surprising that the design was for a one-family residence.

83. I have also taken into account the evidence of Tsang Hing Kai that he (or his son) had paid for certain drainage and other works on the open land. Tsang Cheung's response was that he had not been asked to contribute, and he did not care what Tsang Hing Kai did on the ground floor. Tsang Cheung's response was as one would expect. It may be that with a finding that the Plaintiff was entitled to half of the land, she may have to make a contribution on this score, but the Defendant has not counterclaimed on the basis of an alternative case that the Plaintiff was a co-owner.

(ii) Completion of 1st level when $8,000 paid

84. The second item of evidence was Tsang Cheung's confusion when he gave evidence on the state of the house when he gave Tsang Hing Kai $8,000.

85. At first his evidence was that when he gave the $8,000 to Tsang Hing Kai, the 1st level had already been built. At the same time he said that the 1st level had been built using his money, although he did not know if Tsang Hing Kai had secured the building materials and labour on credit before obtaining the money from him.

86. I find on the evidence that it is likely that the 1st level had in fact been built when Tsang Cheung started financing the construction. Thus he had thought that by contributing $20,000, a 3-storeyed house could be built. However he was later told by Tsang Hing Kai that the $8,000 had gone towards the 1st level only; he was unhappy about that and threatened to pull out of the joint venture. Subsequently, the two couples agreed on a 2-storeyed house.

(iii) Solicitors' knowledge of description of the lot

87. The third item of evidence was how H.M. So & Co got to know the description of the Defendant's lot prior to July 1973.

88. H.M. So & Co's file shows that as early as 13 June 1973, it already had the description of the lot when it wrote to the District Officer asking to do a land search. It is not known how the solicitors got to know the description, because Tsang Cheung says he did not know the description of the lot.

89. One possibility would of course be if, on or before 13 June 1973, Tsang Cheung had taken the title deeds from the Defendant and showed them to the solicitors prior to the visit to the solicitors' office.

90. However, the Defendant had been adamant that it was only a few days before 9 July 1973 (she says on 5 July) that she had given the title deeds to Tsang Cheung. As K.C. Cheung, the clerk in charge of the case has died, it is impossible to know how he had got to know the description of the lot in the absence of instructions from Tsang Cheung or the Defendant, or possession of the title deeds.

91. Be that as it may, it was not the evidence of the Defendant or Tsang Hing Kai that the Defendant had given the title deeds to Tsang Cheung in mid-June 1973, so this third item of evidence, whilst perplexing, does not advance the Defendant's case. The materials from the solicitors file are far from satisfactory - the "attendance note" being just a scribbled sheet.

Inconsistencies and self-contradictions in evidence for Defendant

92. By way of contrast with the simple truthfulness of the Plaintiff and Tsang Cheung, I find that the evidence of the Defendant and Tsang Hing Kai were inconsistent and self-contradictory in 4 crucial areas listed below. Tsang Hing Kai was an unreliable witness, not without guile. The Defendant impressed as a simpler character, who when unable to explain the inconsistencies and contradictions in her case, just sat in the witness-box silently.

93. The 4 areas which were crucial to the determination of this case, and which belied the Defendant's version of events, were chronologically as follows:-

(a) whether there was a loan from Tsang Cheung to the Defendant/Tsang Hing Kai;

(b) whether Tsang Cheung had deceived the Defendant into passing with the title deeds on 5 July 1973;

(c) whether and why the Defendant had signed the Chinese document "P-1" in its present form; and

(d) whether the Defendant and Tsang Hing Kai had given only a licence to Tsang Cheung and his family to live on the 1st floor for a stated period.

(a) Loan

94. The evidence of both Tsang Hing Kai and the Defendant as to whether Tsang Cheung had lent them money was fraught with inconsistencies and self-contradictions. The defence case in Court was that there was no loan.

- Incident in the cafe

95. But in Tsang Hing Kai's Witness Statement dated 25 September 1996 which was interpreted to him by the Defendant's solicitor, he said in paragraph 11 that on one occasion when he and Tsang Cheung were having tea at a cafe,

"I asked Tsang Cheung to lend me money for building my house. Tsang Cheung said he has no money but suggested that he paid for the construction costs in exchange for our assigning to him half of our interest in the land. I refused and explained to him that since the land was the marriage gift of my wife, we could not sell it to anybody in any circumstances whatsoever. When we left the cafe, I apologised to Tsang Cheung for asking him to lend me money, and hoped that this had not affected the good relationship between us."

96. Since paragraph 11 started with a reference to April 1973, one would reasonably have thought that this incident at the cafe took place in 1973. In his oral evidence, Tsang Hing Kai said that this incident took place in 1971.

97. But more importantly, having said in his Witness Statement that there had been a discussion about a loan, Tsang Hing Kai said in evidence in Court that he had never asked Tsang Cheung for a loan, and that he had simply mentioned to Tsang Cheung that his finances were tight, and nothing more. Tsang Hing Kai was unable to explain the inconsistency with paragraph 11 of the Witness Statement.

98. Eventually he relied upon the gift(s) of $500 that Tsang Cheung had stuffed into his pocket on 1 (or 3-4) occasion(s), and his obligation to Tsang Cheung for putting him up in his (Tsang Cheung's) house when he first arrived in Hong Kong from the mainland, as "money dealings" between Tsang Cheung and himself. However, this was neither the case pleaded, nor put forward in Woo & Woo's letter, nor in the Witness Statements, as the basis for indebtedness.

- Admissions of loan in Woo & Woo's letter

99. There were more inconsistencies and self-contradictions to come. After the Defendant had received the letter from So & Co in March 1993 requiring her to assign half of the property to the Plaintiff, she and Tsang Hing Kai went to Woo & Woo and gave them instructions to respond on her behalf.

100. On 6 April 1993, Woo & Woo wrote "in respect of the above matter and your letter dated 20th March 1993, we are instructed that our client has the following comments" which was followed by a detailed 4-page letter.

101. In the paragraph entitled "2. The Land", it was stated that "in 1973, our client's husband approached Mr. Tsang [Cheung],asking the latter to lend money to our client for the purpose of constructing a new building on the Land". This is in stark contrast to Tsang Hing Kai's evidence that he had never asked Tsang Cheung for a loan.

102. The letter also acknowledged that money did change hands. In the same paragraph, there is a reference to Tsang Cheung promising to lend a sum of about $20,000 to the Defendant.

103. In the paragraph entitled "4. The quarrel", it was further alleged that "eventually, it was agreed by our client's husband on behalf of our client and Mr Tsang [Cheung] that Mr Tsang [Cheung]'s family could live in the 1st floor of the building to be constructed for a period of 6 years upon its completion and our client needed not repay the sum Mr Tsang [Cheung] lent her for the purpose of constructing the building on the Land". The inconsistency with the defence's oral evidence is obvious.

104. Further in the paragraph entitled "5. The Occupation", the Defendant's solicitors said "we are given the understanding that Mr Tsang [Cheung] had totally lent the sum of about HK$19,000 to our client in respect of the building costs." Again, the inconsistency with the defence's oral evidence is obvious. Neither Tsang Hing Kai nor the Defendant was able to satisfactorily explain why Woo & Woo would have made the above admissions of a loan if those had not been their instructions.

- Admissions of loan in Defendant's Witness Statement

105. Further in the Defendant's Statement, interpreted to her by her solicitor, she said at paragraph 13 that about 10 days after 9 July 1973, Tsang Cheung came to the house and made a proposal that

"if we allowed him and his family to live in the upstairs premises of my house for six years, we would not have to pay him the money he had lent us. This was the first time that I was aware of the loan from Tsang Cheung to my husband. I did not know when and how they were made. I did not know what the loan was for. ... I thought that he was very kind not to ask for repayment of his loan to us".

106. When cross-examined, the Defendant on the one hand confirmed that that paragraph was correct, yet on the other hand said that there was never any loan, so that she had never felt grateful to Tsang Cheung and it was ludicrous to say that she thought he had been kind to them.

107. In the end, she resorted to saying that she did not remember what had happened. The Defendant's complete inability to explain her inconsistent statements, or even to decide what her case was (one way or the other), was obvious to any casual observer in the courtroom.

108. In rejecting the Defendant's evidence, I have taken into account the fact that she grew up in a village in the New Territories and has had relatively little formal education. However, that can be no excuse for such patent inconsistencies, and in any event, I did not detect any inability to express herself articulately. Whilst Mr Shum's cross-examination was thorough, the witness was not put under pressure, and she was given every opportunity to think over the questions, although in the end she was unable to give answers to a number of them.

- Conclusion on this issue

109. The Plaintiff's case is that $20,000 had been paid in consideration for a half share in the land and exclusive possession of the 1st floor. This is supported by the Chinese document.

110. In contrast, as can be seen above, the evidence of the Defendant and Tsang Hing Kai as to whether money changed hands, and if so, when, and how much, and of what nature, was self-contradictory. This totally discredited the defence case.

(b) Title deeds

111. The Defendant sought to explain how she lost possession of the title deeds (normally kept by the landowner) by saying that Tsang Cheung had deceived her into parting with them on 5 July 1973.

- Pretext for getting title deeds

112. She said that Tsang Cheung had gone to her home and asked her for them on the pretext that he would show them to a friend who read English to see if a 3-storeyed house could be built. It is difficult however to see why the Defendant would have accepted such a pretext, when she and Tsang Hing Kai (on the defence case) had no intention of building a 3-storeyed house, and indeed were already living in the house, in a spartan manner due to their lack of funds.

113. It is also surprising that Tsang Hing Kai's evidence was only that he told the Defendant to ask Tsang Cheung for the title deeds back. One would have thought if the Defendant's evidence were true, it would have aroused Tsang Hing Kai's curiosity as to what inquiries Tsang Cheung was making about his wife's property.

- Defendant's version of events at solicitors office

114. The Defendant's evidence was that on 5 July 1973, she had told her husband that Tsang Cheung had taken her title deeds, and her husband had told her to get them back as there was nothing to read from them.

115. Her evidence was that on 9 July 1973, she was so anxious to get them back that she was prepared to travel to Hong Kong Island in a pregnant state and with a toddler.

116. It is therefore incredible that (according to her evidence) she waited only 15 minutes after the Plaintiff, Tsang Cheung and the man had left the room, and then left without obtaining the title deeds, when that was the very purpose of the journey.

117. Further the way she described her departure was that she first checked to see that there was no-one around, and left hurriedly, as if she was escaping from that place. That is not the way any person would have behaved if she had travelled a long distance just to get her own property back, however naive she was.

118. It is also to be noted that according to the Defendant, she hurriedly left without taking any documents. However that evidence is contradicted by the evidence of Tsang Hing Kai who confirmed the contents of Woo & Woo's letter stating that the Defendant had given him an English document given to her by the solicitor that day, but he tore it up.

119. In the light of those inconsistencies, the Defendant's evidence of what happened at the solicitors office is most unreliable.

- The title deeds

120. Further the evidence of the Defendant and Tsang Hing Kai as to their alleged early demands for the return of the title deeds was also unconvincing.

121. Tsang Hing Kai alleged that he was very angry on the evening of 9 July 1973 after hearing the Defendant's alleged account of what had happened that afternoon. He said when he heard that the Defendant had neither got back the title deeds or a receipt, he thought something questionable had happened. He telephoned Tsang Cheung and demanded an explanation.

122. However (according to Tsang Hing Kai), when Tsang Cheung asked him what proof he had that he (Tsang Cheung) had taken the title deeds, he did not know how to answer. That piece of evidence is quite remarkable, because his wife, the Defendant had, on his own evidence, told him what had happened on the 5th and also on the 9th, and he said he believed his wife. Tsang Cheung's question was tantamount to accusing the Defendant of lying, yet Tsang Hing Kai said he did not know how to answer it.

123. Furthermore, neither Tsang Hing Kai nor the Defendant made any further inquiries as to where the title deeds had gone, when according to Tsang Hing Kai himself, his wife was anxious about them. One would have thought that they would have been extremely concerned to discover the exact whereabouts of the title deeds; given Tsang Cheung's denial, the Defendant and Tsang Hing Kai would have been concerned either to disprove it, or to find into whose hands the title deeds had fallen. Their own evidence of their passiveness belies the Defendant's case.

- No demands for title deeds as condition for possession

124. What is even more unbelievable is their evidence that even after Tsang Cheung had (to use Tsang Hing Kai's words) "cheated" the Defendant of her title deeds, the Defendant and Tsang Hing Kai nonetheless still acceded to Tsang Cheung's request to let him and his family take up residence on the 1st floor.

125. If what the defence says was true, one would have thought that (given what Tsang Cheung had done) the Defendant and Tsang Hing Kai would have wanted nothing to do with him. Or at least, if they were to permit him to move into their house, that it would only be on condition that he first returned the title deeds.

126. The answer given by Tsang Hing Kai in cross-examination was implausible to say the least. His answer was that he "did not need to make it a condition for Tsang Cheung's family to stay at the house that he (Tsang Cheung) should return the title deeds because the title deeds were my wife's. It was not for me to intervene". That answer is incomprehensible, given that he (Tsang Hing Kai) had accepted that his wife depended on him to get the title deeds back, he had been angry with Tsang Cheung on the evening of 9 July 1973 for (as he alleged) taking advantage of his pregnant wife, and he thought it was obvious that Tsang Cheung had cheated her.

127. The inability of the Defendant and Tsang Hing Kai to explain why they did not insist on the title deeds back before they let Tsang Cheung's family into occupation belies their story that the title deeds had been obtained by trickery. The title deeds were in all probability delivered voluntarily by the Defendant to the solicitors at the time when she signed the Chinese document, as the Plaintiff and Tsang Cheung testified, pending execution of the assignment, and that explains why the Defendant never insisted on getting them back before the Plaintiff and her family moved in. That may explain why the title deeds were not returned by K.C. Cheung to the Defendant, but given to Tsang Cheung to keep as security when it was realised that the Defendant was not going to perform her side of the agreement to execute an assignment.

128. I should also mention that in Woo & Woo's letter under the paragraph entitled "4. The quarrel", it is said that there was an agreement that Tsang Cheung's family could live in the 1st floor for a period of 6 years upon its completion and the Defendant would not need to repay the sum Tsang Cheung had lent her for the purpose of constructing the house. It went on to say that "in respect of the title deeds, our client's husband [Tsang Hing Kai] wanted to have them back. However, Mr Tsang [Cheung] refused and warranted that he would return the title deeds after the said 6 year period".

129. However it was never part of the Defendant's evidence at trial that there was a warranty by Tsang Cheung to return the title deeds after the period of the licence. Tsang Hing Kai's evidence in Court was that he had demanded the title deeds as soon as the Plaintiff's family moved in in 1974 and also afterwards, but to no avail.

130. The inability of the Defendant and Tsang Hing Kai to explain why they did not ask for the return of the title deeds before the Plaintiff's family entered into possession of the 1st floor is one of the matters crucial to this judgment against the Defendant.

(c) The Chinese document

131. The Chinese document on its face supports the Plaintiff's case. Although the payment of $20,000 was actually made by Tsang Cheung and not by the Plaintiff, the Plaintiff could make payment by her agent, and there is of course a presumption of advancement by Tsang Cheung in favour of his wife. Similarly, although the land belonged to the Defendant, the building of the house was, with her knowledge and consent, being undertaken by Tsang Hing Kai, so that payment to him of the construction costs to her agent would be equivalent to payment to her.

132. In relation to the Chinese document, the Defendant's evidence was that she had read it briefly, and she said there were far fewer words written on the document before she signed it. I should mention there are some discrepancies between the Defendant's version given in Court as to what words were on it when she signed it, and the version given to her expert. I would also mention that on their own, the words said by the Defendant to have been there (see p.11) when she signed the Chinese document did not appear to make much sense.

133. The expert evidence did not assist the Defendant. The forensic scientist said that of the words alleged to have been there when the Defendant signed the document (appearing on part of 2 columns and the top of the 3rd column only), and the additional words now found in P-1 (totalling 5 columns), it was not possible to say which were written first.

134. However, he said that "the main contents of the handwriting, namely the five columns of Chinese handwriting, were written fluently and dynamically in good line quality and in good Chinese penmanship. They also follow the same rhythm of writing. In my opinion they were written by one and the same person".

135. That must mean that if words had been added onto the Chinese document after the Defendant had signed it (as the Defendant alleges), so as to turn the nature of the document from (as the Defendant alleges) a receipt for title deeds to an agreement for sale of half of the land, the penman would have had to take part in a scheme to forge the document after it was signed by the Defendant.

136. This is not a finding that should be made lightly, and the evidence in the present case is far from adequate to warrant such a serious finding. Consequently I reject the Defendant's evidence that the document had been doctored after she signed it.

137. I also note in passing that in Woo & Woo's letter under the paragraph entitled "3. The title deeds", after having referred to the copy of the Chinese document provided to the Defendant in the 1990's, Woo & Woo said "we are given the understanding that the signed Chinese document mentioned in the above is the same as the Chinese Agreement referred to in your said letter". There was no mention of added words.

138. I also reject the Defendant's allegation that she had acted under the undue influence of Tsang Cheung. As I have found, some $20,000 had been paid by Tsang Cheung for the construction of the house, and the couples had agreed to share the land and occupation of the house between them. In executing the Chinese document, the Defendant was doing no more than formalising the agreement. It would of course have been preferable for the two sides to have been separately represented, but in the 1970's, that was not required, and I accept the Plaintiff's evidence (given in a guileless, straightforward manner) that K.C. Cheung had explained the document to the Defendant and she had indicated her understanding and agreement.

139. The above matters, coupled with the unreliable state of the Defendant's evidence of the alleged events at the solicitors office, render the Defendant's version of the events completely unacceptable.

(d) Plaintiff did not enter under licence only

140. The above leads to the conclusion that the Plaintiff and her family did not enter into possession of the 1st floor under licence, but by right of her title to a half-share of the land and exclusive possession of the 1st floor.

141. I would only add that the evidence of the Defendant and Tsang Hing Kai as to the granting of the alleged licence was in any event most unsatisfactory.

142. The evidence of the period of the licence, allegedly granted in mid-1973, was confusing. At times Tsang Hing Kai's evidence was that the licence was to permit the Plaintiff's family to occupy the 1st floor until his son Tsang Chi Lung reached the age of 6 years. Since Tsang Chi Lung had been born in 1971, that would take the licence to 1977 only.

143. However Woo & Woo's letter puts the period of licence as "a period of 6 years upon its completion", which would take the licence to 1979 since the house was (according to the defence case) completed in 1973. This was also the period pleaded.

144. In Tsang Hing Kai's and the Defendant's evidence in court however, they said the Plaintiff's family did not move in until 1974, and that a period of 6 years occupation was permitted, so that that would take it to 1980.

145. I note that no explanation was proffered by the defence why Tsang Hing Kai did not consider putting the "licence" into writing and getting a written acknowledgment from Tsang Cheung, even though (on the defence case) Tsang Cheung was untrustworthy, having previously "cheated" the Defendant into signing the Chinese document and taken her title deeds.

Conclusion

146. It follows from the above that I accept the Plaintiff's version of the main facts so far as they are relevant to the determination of this action. There were some other disputes of fact, such as what had happened in 1991 or 1992, but I consider those to be peripheral to the main issues.

Conversion of articles

147. It is common ground that on 26 March 1994, certain articles belonging to the Plaintiff's family were taken outside the house and burnt. I reject the fatuous allegation made by Tsang Hing Kai that he had heard noises of articles being broken when the Plaintiff's family was removing their belongings, and his suggestion that the Plaintiff's family were deliberately breaking things so as to throw suspicion on him. That appears to be a recent fabrication as that suggestion had never been made in the correspondence from the Defendant's Solicitors.

148. The Plaintiff was unable to say who had actually done the burning but Tsang Hing Kai admitted that he had regarded the remaining articles as rubbish and that he had burnt them. No similar admission was made by the Defendant.

149. This court deplores those acts of vandalism. No matter what Tsang Hing Kai might have felt about the dispute between the parties, proceedings had already started, and however one might feel about one's case, it is never justified to take the law into one's own hands.

150. Having said that, no claims have been made by the Plaintiff against Tsang Hing Kai, only against the Defendant. It cannot be assumed that the Defendant had authorised her husband to commit possibly criminal acts. In the circumstances, I cannot find the case of conversion against the Defendant made out.

Orders

151. In conclusion therefore I find that the Plaintiff has made out her case in relation to the landed property, and that she is entitled to a declaration that the Defendant has since the date of the Chinese document (9 July 1973) been holding the legal title of one half share of Lot No. 1778 in DD No. 221 as trustee for the Plaintiff, and that the Plaintiff is entitled to exclusive possession of the 1st floor, with a right of way over that part of the ground floor property and the staircase as is necessary to enable the Plaintiff and her visitors to access and egress the 1st floor.

152. There will also be an order that the Defendant do forthwith convey the said interest to the Plaintiff, and I will give liberty to apply to both parties on the details of such conveyance if their lawyers are unable to agree on the same. I will not restrict the time within which either party may apply under that liberty, as I realise difficulties may arise over title matters and the drafting of the conveyance. Although there has been no counterclaim for the same, I would expect the Plaintiff to return the Defendant's title deeds for the purposes of working out the above orders.

153. There should also be an order for possession of the 1st floor, and insofar as the Defendant may need time for her family to move out, I give the Defendant liberty to apply within 14 days from the date of this Judgment for the working out of this order.

154. By reason of the above, the Defendant is liable to the Plaintiff for damages for trespass of the 1st floor, on Tsang Hing Kai's admission that their family had been using the 1st floor since the Plaintiff took away their belongings on 24 March 1994. I do not find that such damages should be calculated from November 1993 because there is no evidence that the Defendant or her family had used the 1st floor as early as November 1993, notwithstanding the Plaintiff's vacating of the same.

155. Tsang Cheung's evidence was that a market rental for the 1st floor was and is $7,000. There was no contrary evidence from the Defendant or Tsang Hing Kai. At that rate, damages for trespass from March 1994 to date would be $441,000 (being $7,000 pm x 63 months from March 1994 to June 1999) and thereafter at the same rate until possession is given, with interest on the damages to date at savings rate (this being a residential property which would have been occupied by the Plaintiff's family as end-users) and after judgment, at judgment rate.

156. There will be an order nisi that the Defendant pay the Plaintiff's costs, with legal aid taxation of the Defendant's own costs.

157. Finally I would like to thank both counsel for their assistance, as I am sure without the benefit of professional assistance, both parties would have found it more difficult to advance their respective cases and this court would have had to spend more time on the trial.