Lai Suk King v. The Personal Representative of the Estate of Leung Yung, Deceased

HCA 2222/2018

[2020] HKCFI 1767

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2222 OF 2018

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Before:  Deputy High Court Judge MK Liu in Chambers (Paper Disposal)

Date of the Plaintiff’s written submissions:  17 July 2020

Date of Decision:  24 July 2020

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DECISION

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1.By a summons dated 22 January 2020 (“the summons”), the plaintiff (“P”) seeks a default judgment against the defendant (“D”) under Order 19 rule 7.

2.The subject matter of these proceedings is a property known as Flat C on 5/F, Pao Fung Building, Nos. 1-7 Hop Yick Road, Yuen Long, New Territories (“the Property”).  P claims that she is entitled to have the Property being transferred from D to her.  P’s case as pleaded in her statement of claim is as follows:

(1)  On 16 February 1956, Mr Lai Pak Fook (“Mr Lai”) and Madam Leung Yung (“Madam Leung”) got married according to the marriage law of Mainland China in Guangzhou. They had no children under their marriage.

(2)  On 5 May 1969, Mr Lai and another woman Madam Wong Yuk Ngor (“Madam Wong”) gave birth to P.

(3)  Ever since her birth, P had lived with and been raised by Mr Lai and Madam Leung.  After the death of Mr Lai on 26 August 1981, Madam Leung continued to bring up and live with P until Madam Leung’s death on 10 October 2017.  During her lifetime, Madam Leung always treated, loved and took care of P as if P were her own daughter.

(4)  In 1986, Madam Leung acquired the Property for investment purposes.

(5)  In or about 1996, Madam Leung orally represented to P (“the Representation”) that:

(a) since Madam Leung had no children or other relatives, she would leave, after her death, the Property to P; and

(b) by reason of such arrangement, P had to, during the lifetime of Madam Leung: -

(i) take charge of the letting of the Property;

(ii) make payments of the outgoings of the Property including management fees, rates, government rent, property tax, utility bills and costs of maintenance and repair of the Property and the common parts of Pao Fung Building.  Since Madam Leung was retiring and had to rely on part of the monthly rental incomes of the Property, P could use the residual amount of the monthly rental incomes to settle the said payments but she had to make up for the shortfall out of her own pocket should the residual amount be insufficient to settle the said payments.

(6)  P orally acknowledged the Representation and agreed to Madam Leung’s proposal (“the Acknowledgment”).

(7)  The Representation and the Acknowledgement constituted a binding agreement (“the Agreement”).

(8)  Since about 1996, P has been duly performing the Agreement.

(9)  On 16 October 2017, Madam Leung died intestate at the age of 89, leaving no surviving husband, issue, parent, brother or sister (whether of the whole blood or half blood), grandparent, or uncle or aunt (whether of the whole blood or half blood of her parent).

(10)  Since P has fully performed the Agreement, P should be entitled to have the Property.  Alternatively, by reason of the common intention between P and Madam Leung, or by reason of proprietary estoppel, P should also be made as the owner of the Property.

3.On 25 January 2019, P obtained an order appointing the Official Solicitor to represent the estate of Madam Leung for the limited purpose of accepting service of the writ of summons in these proceedings.  On 22 March 2019, the writ of summons was served on the Official Solicitor.  On 11 December 2019, P obtained an order that this action would proceed in the absence of a person representing the estate of Madam Leung.

4.While a defendant has failed to serve a defence on the plaintiff within the time prescribed in the rules, the plaintiff may or may not have a default judgment.  The plaintiff would not have a default judgment as of right.  Whether a default judgment should be granted is a matter within the discretion of the court.  See Hong Kong Civil Procedure 2020, Volume 1, §19/7/13.

5.In this case, I am not prepared to grant a default judgment to P for the following reasons:

(1)  In some cases, while the statement of claim has been duly served on the defendant and the defendant chose not to make any response to the statement of claim, the court may take that the matters pleaded in the statement of claim as facts not disputed by the defendant, and may grant a default judgment to P on this basis.  However, in this case, there is no one representing the estate of Madam Leung.  Naturally, no one would file and serve a defence to contest P’s claim.  In the circumstances, absence of a defence cannot be deemed as an admission of the matters pleaded in the statement of claim.

(2)  It is well established that a claim against a deceased person must be examined with caution.  In Kwan So Ling v Woo Kee Yiu Harry and Others (HCA 1311/2011, 30 April 2015), G Lam J said:

“34. In approaching the plaintiff’s evidence, I remind myself that caution is needed since she is in effect alleging a gift or the promise of a gift to her by persons who are now deceased; she is making allegations of promises and assurances by Mr Woo Snr and Madam Woo neither of whom is alive. When these allegations were first made by the plaintiff in 2011, Madam Woo had already lost her mental capacity. In these circumstances great care is called for when assessing the plaintiff’s assertions. As Lord Walker of Gestingthorpe NPJ stated in Yung Shu Wu v Vivienne Sung Wu (2011) 14 HKCFAR 39 at §73:

‘Vivienne is making a claim against the estate of a deceased person who cannot give evidence against her claim. The court has always approached such claims with some suspicion, especially (in the case of an alleged gift) where the only or principal witness in support of the claim is the donee. Corroboration is not essential in every case. But as Plowman J said in Thomas v. The Times Book Co. Ltd [1966] 2 All ER 241, 244 (the curious case about ownership of the manuscript of Dylan Thomas’ Under Milk Wood),

“Therefore, not only in this case is the onus of proof on the defendants [who were resisting a claim by the poet’s administratrix], but I am enjoined by authority to approach their story with suspicion having regard to the fact that the other actor in the story, the late Dylan Thomas, is dead and cannot therefore give his own version of what took place.”

This principle has been applied in Cheung Cho Kam Sindy v. Cheung Yuet Ying Rose (Deputy High Court Judge Muttrie, 13 July 2007).’

His Lordship referred again at §76 to this as ‘the special burden assumed by a person claiming to be a donee under a gift made by a deceased person’.  See also In re Finch (1883) 23 Ch D 267 and In re Garnett (1885) 31 Ch D 1, 8.”

(3)  Whether P’s claim may succeed would depend upon, inter alia, whether Madam Leung made the Representation to P in or about 1996 as alleged. This is an allegation made against a deceased person.  In my judgment, the court has to examine this allegation with caution.

(4)  In my view, it would not be appropriate and prudent to give judgment to P merely based upon the matters pleaded in the statement of claim without hearing P’s evidence.  P should come to the court to give live evidence and answer questions from the court.  The court can only decide whether judgment should be given to P after seeing and hearing P’s evidence.

6.For the reasons above, I dismiss the summons. There be no order as to costs.

Mr Aidan Tam, instructed by Arthur Au & Co, for the plaintiff