Read the full judgment text of HCA 2218/2019 on BabelCite. This Court of First Instance judgment was delivered on 5 October 2020 before Coleman J.
Civil law – common intention constructive trust – resulting trust – default judgment – declaratory relief – proprietary relief – liquidated demand – tracing – knowing receipt – dishonest assistance – unjust enrichment – exercise of discretion – Order 19 rule 7 RHC – Order 19 rule 2 RHC – plaintiff and deceased father returned to Hong Kong from UK in 1992 and jointly purchased FF Shops in 1993 with plaintiff contributing at least HK$2,351,694 – between 1995 and 1997 plaintiff paid HK$2,544,780 to acquire land and fund construction of two Small Houses (House 71 in plaintiff's name and House 72 in father's name) with common understanding rental income from both houses to be deposited in joint account for plaintiff's benefit minus fixed authorised amount – plaintiff suffered depression and left management to father – father died 8 March 2018 leaving Will bequeathing House 72 to twin daughters (defendants) – plaintiff subsequently discovered alleged unauthorised withdrawals of HK$2,300,000 from joint rental account in favour of 1st defendant, missing rental income of HK$1,221,100, and unauthorised sale of FF Shops with proceeds applied to acquire TSH Shop jointly in father's and 1st defendant's names – application for default judgment under O. 19 r. 7 – whether court should grant default judgment for proprietary/declaratory relief in respect of House 72 based on CICT or resulting trust: yes – three elements of CICT (common intention, detrimental reliance, unconscionability) were made out on the pleadings, with plaintiff having paid entire purchase and construction costs and no presumption of gift or advancement applying from son to father – genuine need for declaratory relief and justice would not be done if relief denied, consistent with Kan Kiu Chor v Fung Shu Fun and distinguishable from Lung Ka Kuen v Chu Chun Yuk – whether claim for HK$3,521,100 (unauthorised withdrawals and missing rental income) is a liquidated demand under O. 19 r. 2: no – claim is not a specific sum due under a contract, and the SOC pleads alternative remedies of account, restitution, and damages such that the proper remedy is for trial – whether claim for FF Proceeds of approximately HK$2,257,105 is a liquidated demand: no – figures require assessment of valuation and the plaintiff's share, not ascertainable as a matter of arithmetic – outcome: default judgment granted for proprietary claims relating to House 72, with declaration of trust, removal of trustee, vesting order in plaintiff's favour, order for vacant possession and delivery of title documents, order for mesne profits, and stamp duty to be borne by defendants – remaining claims directed to trial/assessment with standard directions for discovery, expert reports on land valuation, and witness statements – 1st and 2nd defendants jointly and severally liable for costs of the Summons – interlocutory injunctions continued.
Legal issues: Whether to grant default judgment for proprietary relief in respect of House 72 based on common intention constructive trust / resulting trust · Whether the claim for HK$3,521,100 (Unauthorized Withdrawals and Missing Rental Income) is a liquidated demand under Order 19 rule 2 · Whether the claim for FF Proceeds of approximately HK$2,257,105 is a liquidated demand
Outcome: Default judgment granted in favour of the plaintiff for the proprietary claims relating to House 72, with declarations and orders vesting House 72 in the plaintiff. The plaintiff's claims relating to the Unauthorised Withdrawals, Missing Rental Income, and FF Proceeds were directed to trial/assessment. The 1st and 2nd defendants were ordered jointly and severally to pay the costs of the Summons. The plaintiff's previous interlocutory injunction orders were continued.
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