Cheung Hei Sing t/a Harvest Oily Product Trading Co v. Wong Kit Chi, The Administratrix of the Estate of Wong Kwai Sum, Deceased

DCCJ 4889/2018

[2020] HKDC 1006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 4889 OF 2018

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BETWEEN

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Before: Deputy District Judge Philips Wong in Court

Date of Hearing: 3 November 2020

Date of Judgment: 3 November 2020

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JUDGMENT

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A. BACKGROUND

1.In this case, the plaintiff claims against the defendant, as the administratrix of the estate of Wong Kwai Shum (“the Deceased”), the sum of HK$200,000.  According to the plaintiff’s case, the sum represented the money lent by the plaintiff to the Deceased upon the Deceased’s oral request in August 2016. 

2.The trial of the action took place before me today.  The plaintiff is represented by counsel whereas the defendant is absent.  The defendant has ceased to be legally represented since 21 October 2019, and has not responded to the present proceedings since then. 

3.In this regard, the plaintiff’s solicitors have prepared and filed 2 affirmations of service, namely the 2^nd and 3^rd Affirmation of Cheung Sai Ho, showing that all the relevant papers, including the Amended Writ of Summons (with the Amended Statement of Claim endorsed thereon), the Order dated 2 July 2020, the Notice of Setting down the Case, and the trial bundles, have been duly served on the defendant.  I am further informed by Mr Chan, Counsel for the plaintiff, that there was without prejudice correspondence between the parties recently and that the defendant ought to have notice of today’s trial.  I am satisfied that the defendant ought to have notice of the trial but chose not to attend.

4.Pursuant to the order made by Master B Mak on 9 October 2019, having failed to file and serve a List of Documents on or before 20 November 2019 and any witness statements before 18 December 2019, the defendant has been debarred from adducing factual evidence or documentary evidence at trial.  As a result, the only evidence before me is the evidence adduced by the plaintiff.

B. THE PARTIES’ PLEADED CASE AND THE EVIDENCE

5.As mentioned above, the plaintiff’s case is that upon the Deceased’s oral request made in or about August 2016, the plaintiff has lent HK$200,000 to the Deceased by depositing a cheque of HK$200,000 into the Deceased’s bank account.

6.The Defence consists largely of non-admission.  No positive case has been advanced.  The defendant simply requests the plaintiff to prove its case.

7.The plaintiff’s case is supported by the evidence from the plaintiff, which is largely contained in the Witness Statement of Cheung Hei Sing (“the Witness Statement”).  The contents of the Witness Statement are unchallenged as the defendant did not attend the trial to cross-examine the plaintiff. The defendant has also not adduced any evidence to counter the plaintiff’s case.

8.According to the plaintiff’s unchallenged evidence, the plaintiff has known the Deceased since 2009.  Since around late 2009 or early 2010, the plaintiff had started to have business relationship with the Deceased’s company “Fair View Oil Co., Limited”.  The relationship involved the supply of fuel to each other when there was inadequate fuel to supply to the customers.  Apart from the business relationship, the plaintiff had also had regular gatherings with the Deceased for years. 

9.In or about April 2014, the plaintiff tried to contact the Deceased but in vain.  Later, the plaintiff heard from one of the Deceased’s employees that the Deceased looked as if he had some health issues.  The plaintiff last saw the Deceased in June 2016, and did notice that the Deceased looked unwell. 

10.In or about August 2016, the Deceased called the plaintiff and requested for a loan of HK$200,000.  As the plaintiff had good relationship with the Deceased and the amount asked for was not large, the plaintiff agreed to lent him the amount.  At the time, the plaintiff thought the Deceased may need the money for medical treatment.

11.As the plaintiff did not have sufficient cash at the time, he agreed to arrange to have a cheque deposited into the Deceased’s account.  The Deceased provided the plaintiff with his personal account number with the Bank of East Asia (“the Deceased’s BEA Account”), and the plaintiff had deposited a cheque of HK$200,000 into the Deceased’s BEA Account on 19 August 2016.

12.There is no dispute between the parties that a sum of HK$200,000 was deposited into the Deceased’s BEA Account on 19 August 2016.  In the Defence, the defendant however contends that the payor of the amount was not identified.

13.The plaintiff on the other hand has produced the following documentary evidence in support of his case:-

(a) copy of the cheque in the amount of HK$200,000 dated 19 August 2016 issued by the plaintiff’s company “Harvest Oily Product Trading Co” (“Harvest Oily”) in favour of the Deceased;

(b) copy of a deposit slip showing the deposit of HK$200,000 into the Deceased’s BEA Account on 19 August 2016; and

(c) copy of the bank statement of the Harvest Oily’s bank account showing the debit of HK$200,000 on 19 August 2016.

14.In the absence of any contrary evidence, I am satisfied that the above evidence adduced by the plaintiff plainly shows that it was the plaintiff who had arranged to have HK$200,000 deposited into the Deceased’s BEA Account on 19 August 2016.

15.According to the plaintiff, it was not discussed between the plaintiff and the Deceased on the time for repayment of the loan. 

16.The Deceased passed away on 19 December 2016.

17.The plaintiff, through his solicitors, issued a letter to the Deceased’s wife on 29 March 2017, informing the Deceased’s wife of the above loan and asked whether the Deceased’s wife would apply for letters of administration of the Deceased’s estate. 

18.On 12 April 2017, Messrs S T Cheng & Co (“ST Cheng”) wrote to the plaintiff’s solicitors in respect of another District Court Action No DCCJ1566/2017. ST Cheng claimed to be acting on behalf of Ms Wong Kit Chi, the intended administratrix of the Deceased. 

19.Thereafter, there was numerous rounds of correspondence between ST Cheng and the plaintiff’s solicitors on DCCJ1566/2017 and the above-mentioned loan. In so far as the loan is concerned, ST Cheng asked for proof of the alleged loan.  Further, in the letter dated 15 February 2018, ST Cheng stated that the defendant was still in the course of locating relevant accounting records or any other documents which may assist her in ascertaining the plaintiff’s claim.  However, there is no evidence on whether the defendant did conduct the alleged search, and if so, whether she has located anything relevant. 

C. THE ISSUES

20.As Mr Chan, Counsel for the plaintiff, has rightly pointed out, there are three issues required to be determined, namely:-

(a) Whether the plaintiff and the Deceased had entered into a loan agreement for HK$200,000 in or about August 2016 (“the Loan Agreement”) (“the 1^st Issue”);

(b) Whether the HK$200,000 received by the Deceased on 19 August 2016 was from the plaintiff, and whether it was made pursuant to the Loan Agreement (“the 2^nd Issue”); and

(c) Whether the plaintiff is entitled to the return of the HK$200,000 (“the 3^rd Issue”).

The 1^st Issue

21.Considering all the evidence before me, I find that there existed a loan agreement made orally between the plaintiff and the Deceased in or about August 2016 under which the Deceased requested the plaintiff to lent him HK$200,000. I have come to such finding based on the following:-

(a) First, there is unchallenged evidence from the plaintiff in support of such finding.

(b) Second, there was undoubtedly payment of HK$200,000 by the plaintiff to the Deceased’s BEA Account on 19 August 2016 (see further below).  The defendant has not put forward any other possible explanation of such payment.  As mentioned above, the defendant stated in correspondence that it would look into the records but there is no evidence on whether she had in fact done so, and if she did, whether there is anything relevant located.

(c) Third, the plaintiff has explained the background and relationship between himself and the Deceased prior to the alleged Loan Agreement.  In particular, the plaintiff had known the Deceased for more than 6 years and they had frequent gatherings over the years.  The plaintiff and the Deceased also had business relationship as mentioned above.  This lends support to the probability that the Deceased would approach the plaintiff for financial assistance if required.  In fact, even after the Deceased has passed away, the plaintiff had assisted the Deceased’s company by providing fuel to the same to enable it to meet its customers’ need. 

(d) Last but not least, the defendant could have adduced evidence rebutting the plaintiff’s case, for example by showing that the Deceased was in good financial position at the time and so there was no reason for him to ask for a loan.  Alternatively, the defendant could have adduced evidence showing that the payment of HK$200,000 was for some other purpose.  However, the defendant has failed to adduce any such evidence.  More importantly, the defendant has failed to explain the absence of any such evidence in response to the plaintiff’s case.  Applying Ip Man Shan v Ching Hing Construction Co. Ltd. (No. 2) [2003] 1 HKC 256 (at 307) (the case was subsequently upheld in appeal), I am entitled to draw an adverse inference against the defendant that if the defendant were to adduce such available evidence, such evidence would not have displaced the prima facie case proved by the plaintiff.

The 2^nd Issue

22.As I have summarized in §13 above, I have no difficulty in finding that it was the plaintiff who made the payment of HK$200,000 into the Deceased’s BEA Account.  The evidence is again unchallenged and the defendant has not suggested, let alone adduced evidence, to show that the deposit may have been made by some other party.

23.I also have no difficulty in finding that the payment was made pursuant to the Loan Agreement.  Again, this is the unchallenged evidence of the plaintiff, and the defendant has not suggested any alternative theory as to what that amount could have been deposited for.

The 3^rd Issue

24.According to the plaintiff, the loan was made without any stipulation as to the time of repayment.  It is well-established that where a loan had been made without any provision as to the time for repayment or even where the loan was expressed to be repayable on demand, the obligation on the borrower to repay was immediately after the loan was made: Chuang Yue Chien Eugene v Ho Yau Kwong Kevin [2002] 4 HKC 245, at §15.

25.There is accordingly no reason why the plaintiff should not be entitled to the repayment of the loan.

D. CONCLUSION

26.Based on my findings and determination above, I grant judgment in favour of the plaintiff against the defendant in the sum of HK$200,000.

27.On the question of interest, Mr Chan has cited the Court of Appeal’s decision in Chow How Yeen Margaret v Wex Pharmaceuticals Inc [2018] 3 HKLRD 163 in support of his submissions in relation to pre-judgment interest. I agree with his submissions and will follow the guidance of the Court of Appeal.  I award interest on the sum of HK$200,000 at the Hong Kong prime rate plus 1% from 19 August 2016 until the date of this judgment, and thereafter at the prevailing judgment rate at the time until full payment. 

28.The plaintiff, being the successful party, should be entitled to the costs of the action, with certificate for Counsel, to be taxed if not agreed. Given the defendant is absent today, I also direct that unless the parties make an application to vary the above costs order nisi within 14 days from the date of this judgment, such order will be made absolute.

Mr Albert Chan, instructed by Chung & Kwan, for the plaintiff

The defendant was not represented and absent