Yau Kwong Chiu and Another v. Yau Kwong Ha

CACV000448/2000

CACV 448/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 448 OF 2000

(ON APPEAL FROM HIGH COURT ACTION
NO. 2607 OF 1997)

-------------------------

-------------------------

Coram: Hon Leong CJHC, Wong and Woo, JJA in Court

Date of hearing: 13 February 2001

Date of handing down judgment: 20 February 2001

-----------------------

J U D G M E N T

-----------------------

Hon Woo JA (giving the judgment of the Court):

Background

1. This action concerns a family dispute. The defendant is the elder sister of the 1st plaintiff whose wife Madam Siu gave birth to the 2nd plaintiff. The dispute is in relation to the monies in the joint account 0330-649989 held in the joint names of the defendant and the mother of the defendant and the 1st plaintiff, Madam TAM Ling, whom we shall call "Mother". The 2nd plaintiff, who was born in December 1978, is the grandson of Mother. It is common ground that Mother and the defendant had at all material times great affection for the 2nd plaintiff. The 1st plaintiff and the defendant, their father ("Father"), Mother and the 2nd plaintiff lived together in the same household until sometime in 1980. In August 1980, Father bought a flat in Tai Wah House. The 1st plaintiff and the woman with whom he was then cohabiting, Madam Lai, started to occupy that flat. On 10 September 1980, Father died intestate. In 1984, the defendant got married and left the family. In May 1984, Mother sold the Tai Wah House flat, which was part of the estate of Father, for $178,000 and kept the proceeds.

2. On 17 December 1986, Mother made a will bequeathing the entirety of her estate in favour the 1st and 2nd plaintiffs and the defendant in equal shares. On 10 June 1987, Mother bought a flat in Tak Po Building for $304,500 and had it registered in the joint names of her and the 1st plaintiff. This was a joint tenancy subject to survivorship.

3. On 25 May 1989, Mother sold a shop, which was the remaining asset in the Father's estate, for $3.9 million. On 27 May 1989, a deed of family arrangement was made whereby Mother paid $750,000 to be shared equally amongst the 1st plaintiff, the defendant and their three half-brothers, who were born out of a marriage between Father and another woman, each of the five receiving $150,000. On 30 May 1989, Mother paid $1,150,540 to be shared between the 1st plaintiff, Yau Kwong-yiu (one of the half-brothers) and the defendant equally, each getting about $383,000. Mother retained about $1.6 million.

4. On 7 June 1989, Mother and the defendant opened an account 0330-649989 in their joint names expressly subject to survivorship ("the joint account"), and Mother deposited $1.3 million into the joint account. The monies in the joint account, sometimes converted into foreign currencies, were used to earn interest, which interest was withdrawn every month for Mother's maintenance and use.

5. On 11 September 1989, there was a withdrawal of $200,000 by Mother from the joint account. On 15 November 1990, Mother was admitted into the hospital for stomach pain. On 22 November 1990, the defendant withdrew $316,329 from the joint account, and with that sum she paid for Mother's medical and other expenses. On 1 December 1990, Mother died, and a credit balance of $1,109,872.93 stood in the joint account. On 24 December 1990, the defendant cancelled the joint account and withdrew the entire remaining balance.

6. The 2nd plaintiff left Mother's household in 1989 to live with his father, the 1st plaintiff. In 1991, the 2nd plaintiff went to the United Kingdom to study.

7. By Mother's will made on 17 December 1986, the 1st plaintiff and the defendant were made executors of her estate. However, the two siblings were divided as to whether the monies in the joint account formed part of Mother's estate.

8. On 12 June 1996, a memorandum was signed between the 1st plaintiff and the defendant for dividing a sum of $852,006.93 in three ways, respectively in favour of the 1st plaintiff, the 2nd plaintiff and the defendant. In that memorandum, a schedule was attached to show how that sum was arrived at, being $1,109,872.93 less $257,866 (the difference between the total receipted amount of $274,089 of medical and funeral expenses for Mother and the $16,223 cash received at the funeral).

9. After the memorandum was made, the 1st plaintiff demanded that the sum of $316,329 withdrawn by the defendant on 22 November 1990 from the joint account be brought in for similar division amongst the three persons, or otherwise he would not be bound by the memorandum. The defendant treated the demand as a repudiation of the agreement contained in the memorandum and accepted the repudiation.

10. Shortly thereafter, a harassment campaign by the 1st plaintiff, sometimes with the 2nd plaintiff participating, was launched against the defendant. The campaign ended in September 1998. These harassments were the subject of a counterclaim made by the defendant.

11. The action was heard before Yam J for six days, at the end of which he gave judgment. He found that the monies in the joint account were intended by Mother to be given to the defendant and dismissed the plaintiffs' claim. He awarded a sum of $30,000 as damages for the harassment caused by the 1st plaintiff to the defendant and granted injunctions against the 1st plaintiff from causing or permitting to cause harassment or nuisance to the defendant, her family members and colleagues.

The appeal

12. Against the judgment, the plaintiffs appeal. However, there is no appeal against the order for damages for harassment.

13. A number of grounds of appeal are raised to attack the Judge's finding of the monies in the joint account being a gift by Mother to the defendant. The plaintiffs rely on the presumption of resulting trust and submit that it was not rebutted by the defendant. They also rely on the discrepancies in the defendant's evidence on the one hand and the contents of her witness statements and of her solicitors' correspondence on the other hand to ask this court to interfere with the finding of the Judge. Relating to the injunctions, the only ground of appeal is that since the acts of harassment had stopped in September 1998, the injunctions granted by the Judge were unnecessary and therefore not justified.

Rebuttal of presumption of resulting of trust

14. It is common ground that the monies in the joint account were derived from the initial deposit $1.3 million made by Mother. It is argued that as there was no presumption of advancement in favour of the defendant, who was an adult daughter of Mother and Mother not being in the position of loco parentis, a presumption of resulting trust arose. It was therefore incumbent upon the defendant to rebut the presumption. Yet the Judge in his judgment had not dealt with this question. This ground of appeal and argument, if we may say so, is an attempt to camouflage an attack on a finding of fact to appear as if it were a challenge based on law. In his judgment, the Judge made specific findings of the monies in the joint account being a gift from Mother to the defendant. He said:

"According to the defendant, the deceased specifically told her before that the money was intended for the defendant alone."

"...the intention could also be derived from the fact that it was a joint name account and there was specifically a survivorship provision which they have instructed the bank to do so before they opened the account. It was explained to them by the bank staff, in particular clause 4, that the survivor would take the balance in the account.

After the account was opened, the mother had never operated the account at all. It is evident from the papers before me that the mother had two other accounts at least and she had been actively involved in operating her other accounts. If it was just a matter of convenience, the mother (1) need not have opened a joint account with the daughter, (2) could have only added the daughter as one of the signatories to operate the account. In my view, it is a typical informal arrangement in a Chinese family where the mother gave her own money to the daughter."

"After accepting the defendant's evidence, I have no hesitation to find in this case that the joint account was meant to be a gift from the mother to the daughter."

15. In view of the Judge's finding that the monies in the joint account were a gift by Mother to the defendant, it is crystal clear that any presumption of resulting trust in respect of them must have been rebutted. This ground of appeal therefore fails.

16. The plaintiffs are in fact challenging the Judge's finding of a gift purely on facts. In this, they have an uphill task. Mr Hung for the plaintiffs refers us to So Amy and Ors v Au Leslie [1995] 2 HKC 113, where Godfrey JA said at 116C-E:

"We, in this court, have not had the benefit of seeing the witnesses and hearing their evidence. The judge had to resolve an irreconcilable conflict between Leslie's testimony and Goldie's testimony. The demeanour and manner of these two, seen and heard as they were by the judge, were material and indeed important elements in his consideration of whose evidence was to be preferred. Nevertheless, it is our duty to reconsider all the materials before the judge and to make up our own minds, not disregarding the judgment below but carefully weighing and considering it, and not shrinking from overruling it, if on full consideration we come to the conclusion that his finding on this point was wrong. We cannot excuse ourselves from the task of weighing the conflicting evidence, and drawing our own conclusions upon it; but in doing so, we must be careful to make due allowance for the disadvantage under which we labour in that we, unlike the judge, have neither seen nor heard the witnesses."

17. Ms Remedios refers us to another judgment of Godfrey JA in Shieh Shin Jiu v Mak Shiu Kei, Johnny and Anr, CACV 174/1997 (13 April 1999, unreported) where the judge said at p 4K-P:

"The appeal is by way of rehearing, but that does not mean that this court will retry the case. This court will not usurp the function of the trial judge to find the facts. It certainly will not disturb his findings of primary fact when these are based on the credibility of the witnesses and a preference for the evidence of one witness over that of another. The extent to which an appellate court can interfere with a judge's findings of primary fact is very limited. An appellant who seeks to disturb an adverse finding of primary fact has to demonstrate either (1) that there is no evidence to support it; or (2) that it is contrary to documentary or other incontrovertible evidence which the judge overlooked. It is not enough to show that there is very little evidence to support the judge's finding or that it was 'contrary to the weight of the evidence'. The weight of the evidence is a matter for the trial judge. It does not matter how many witnesses say one thing, and how few say the contrary. The judge is entitled to prefer the evidence of the few to that of the many."

18. A recent challenge of primary findings by a trial judge was made in Speedy Rich (Asia) Limited v Leung Pui Shu and Anr, CACV 272/2000 (8 February 2001, unreported) where certain passages in a couple of English authorities were cited by this Court, differently constituted, as representing accurate statements of the law on this topic. In Benmax v Austin Motor Co. Ltd [1995] AC 370 at 375 Lord Reid said:

"Apart from cases where appeal is expressly limited to questions of law, an appellant is entitled to appeal against any finding of the trial judge, whether it be a finding of law, a finding of fact or a finding involving both law and fact. But the trial judge has seen and heard the witnesses, whereas the appeal court is denied that advantage and only has before it a written transcript of their evidence. No one would seek to minimise the advantage enjoyed by the trial judge in determining any question whether a witness is or is not trying to tell what he believes to be the truth, and it is only in rare cases that an appeal court could be satisfied that the trial judge has reached a wrong decision about the credibility of a witness. But the advantage of seeing and hearing a witness goes beyond that: the trial judge may be led to a conclusion about the reliability of a witness's memory or his powers of observation by material not available to an appeal court. Evidence may read well in print but may be rightly discounted by the trial judge or, on the other hand, he may rightly attach importance to evidence which reads badly in print. Of course, the weight of the other evidence may be such as to show that the judge must have formed a wrong impression, but an appeal court is and should be slow to reverse any finding which appears to be based on any such considerations."

19. In S. S. Hontestroom v S. S. Sagaporack [1927] AC 37, at p. 47, Lord Sumner said:

"What then is the real effect on the hearing in a Court of Appeal of the fact that the trial judge saw and heard the witnesses? I think it has been somewhat lost sight of. Of course, there is jurisdiction to retry the case on the shorthand note, including in such retrial the appreciation of the relative values of the witnesses, for the appeal is made a rehearing by rules which have the force of statute: Order LXVIII, r. 1. It is not, however, a mere matter of discretion to remember and take account of this fact; it is a matter of justice and of judicial obligation. None the less, not to have seen the witnesses puts appellate judges in a permanent position of disadvantage as against the trial judge, and, unless it can be shown that he has failed to use or has palpably misused his advantage, the higher Court ought not to take the responsibility of reversing conclusions so arrived at, merely on the result of their own comparisons and criticisms of the witnesses and of their own view of the probabilities of the case. The course of the trial and the whole substance of the judgment must be looked at, and the matter does not depend on the question whether a witness has been cross-examined to credit or has been pronounced by the judge in terms to be unworthy of it. If his estimate of the man forms any substantial part of his reasons for his judgment the trial judge's conclusions of fact should, as I understand the decisions, be let alone. In The Julia (1) Lord Kingsdown says: 'They, who require this Board, under such circumstances, to reverse a decision of the Court below upon a point of this description, undertake a task of great and almost insuperable difficulty. ... We must, in order to reverse, not merely entertain doubts whether the decision below is right, but be convinced that it is wrong.' Wood L.J., in The Alice (1), says: 'The principle established by the decision in The Julia (2) is most singularly applicable. ... We should require evidence that would be overpowering in its effect on our judgment with reference to the incredibility of the statements made.' James L.J. thus laid down the practice in The Sir Robert Peel (3): 'The Court will not depart from the rule it has laid down that it will not overrule the decision of the Court below on a question of fact in which the judge has had the advantage of seeing the witnesses and observing their demeanour, unless they find some governing fact which in relation to others has created a wrong impression."

20. Mr Hung realises that he is faced with the above authorities in challenging the findings made by the Judge, especially the finding of primary fact that the monies in the joint account were a gift by Mother to the defendant by dint of the Judge's acceptance of the defendant's testimony. However, he still details the discrepancies in the defendant's evidence in various aspects in order to ground his challenge. He submits that whereas in the witness's statements made by the defendant and her solicitor's letters before action that the defendant's claim on the monies was based on the right of survivorship, she testified before the Judge that Mother mentioned before the opening of the joint account that the money to be deposited into it by Mother was intended for her. The same submission was made to the Judge and was obviously in his mind when he delivered judgment. In the passages of his judgment cited above, it is plain that the Judge accepted that the intention of giving the money in the joint account to the defendant was made known by Mother before the opening of the joint account. The Judge also found that the intention of gift was consistent with the fact that Mother instructed the bank to open the joint account with the survivorship provision after the bank staff had explained clause 4 to her. We cannot agree that the Judge erred in this respect, nor are we indeed entitled to interfere with such findings.

21. Mr Hung also challenges the defendant's evidence on the purpose of the $316,329 withdrawn from the joint account on 22 November 1990, whether it was money out of which the $274,089 mentioned in the memorandum of 12 June 1996 had been expended. Coupled with this, Mr Hung challenges the Judge's ruling that the memorandum of 12 June 1996 did not amount to an admission by the defendant that the monies in the joint account belonged to Mother's estate.

22. What the Judge found was that the $274,089 came out of the $316,329. He also accepted that defendant's evidence that the sum of $316,329 was mentioned by the 1st plaintiff at the time when the memorandum was negotiated and that she told the 1st plaintiff that it should not be taken into consideration. He disbelieved the 1st plaintiff's evidence that the $316,329 was not mentioned at the negotiations. On the basis of the defendant's refusal to take the $316,329 into account when entering into the memorandum, the Judge rejected that the memorandum amounted to an admission by the defendant that the monies in the joint account belonged to Mother's estate. He said:

"I am afraid I cannot find the admission on the part of the defendant. She intended to put an end to the disputes by way of settlement and that was why she had deducted $270,000 odd which she said was evidenced by the receipts. It is true that she had previously said she withdrew $316,000 from the bank before her mother's death in order to spend it on all other expenses. The calculations by itself would show that if the joint account was truly part of the estate, the $316,000 withdrawal would have to be taken into consideration."

23. We are unable to accept that the Judge erred in this respect either. Mr Hung has not been able to show us anything that would justify our interfering with the Judge's findings.

24. In his judgment, the Judge set out the 1st plaintiff's relationship and cohabitation with four women and Father's refusal to have the Tak Wah House flat registered in the joint names of himself and the 1st plaintiff and commented thus:

"The family arrangement of this family involving the mother and father of the parties has something to tell on why the mother gave substantial amount of money to the daughter. The defendant brought out, in particular the several marital and extramarital relationships in the past years of the 1st plaintiff, not for this court to pass a moral judgment but to demonstrate why the father and mother did not trust the 1st plaintiff."

"The aforesaid account is telltale of the fact that the both the father and mother did not trust the 1st plaintiff at all. It was quite logical and reasonable for the mother just to give the 1st plaintiff half of Tak Po Building."

25. We cannot possibly say that the Judge had erred in all these findings. In the event, the appeal against the findings of a gift fails.

The claim on behalf of the 2nd plaintiff

26. By the notice of appeal, a declaration is also sought on behalf of the 2nd plaintiff that the defendant is to pay $360,000 to the 2nd plaintiff in order to enable him to complete his studies in the UK and/or a further sum of $240,000 being the education and living expenses of the 2nd plaintiff for the past two years. This is based on an alleged agreement made on about 7 June 1998 between Mother and the defendant. An application was made to raise this matter by way of amendment to the Statement of Claim which was disallowed by the Judge. Mr Hung has therefore to challenge the Judge's decision not to allow the amendment. He refers us to the testimony of the defendant and urges us to find from that and the circumstances of this case that there was a promise given by the defendant to Mother to support the 2nd plaintiff.

27. In this regard, it is only necessary for us to refer to the Judge's findings. He said:

"According to the defendant, the deceased specifically told her before that the money was intended for the defendant alone. Her mother even said that the defendant daughter should not tell the 1st plaintiff or anyone else about it. Although the defendant said the mother did mention that she hoped the defendant would provide financial or other means of assistance to her grandson, the 2nd plaintiff, the deceased had never specifically mentioned that such assistance was to come out of the money in the joint account. Her mother only reminded her to look after the 2nd plaintiff should he need help. In my view it was just an expression of a wish with no legal implications. The mother did not secure a promise from the daughter before transferring the money to the joint account she had with the daughter."

28. Later on, the Judge said:

"After accepting the defendant's evidence, I have no hesitation to find in this case that the joint account was meant to be a gift from the mother to the daughter. The expression that the defendant would take care of the 2nd plaintiff who was dear to her was just an expression of a wish, it has no legal binding relationship intended at all."

29. In view of such findings, which we are not persuaded to be incorrect, this ground of appeal launched for the 2nd plaintiff must also fail.

The injunctions

30. In his judgment, the Judge found as proved various acts and conduct of harassment exerted by the 1st plaintiff, sometimes with the 2nd plaintiff, over the defendant and her husband, at both of their places of work and at their home. Both the 1st plaintiff and the defendant made various reports to the police, but the acts of harassment continued. After awarding damages in the sum of $30,000 against the 1st plaintiff, the Judge said:

"I find that an injunction is also necessary in the circumstances of this case, and I am sure the 1st plaintiff would be advised not to continue those communications again. They are unwelcomed by the defendant and the defendant has stated clearly that she is represented by solicitors and any communication with her from now on should go through her solicitors."

31. The only ground of appeal against the injunctions granted by the Judge is that the last act of harassment by the 1st plaintiff took place on 4 September 1998 and the last act complained of against the 2nd plaintiff was that on 23 July 1998. What Mr Hung is saying is that since those last acts, the plaintiffs had not committed any further acts of harassment or nuisance against the defendant, wherefore the injunctions granted by the Judge were unnecessary. Mr Hung has not shown to us that the Judge had erred in granting the injunctions save that the acts of harassment had stopped before the trial. It is to be noted that numerous acts of harassment were perpetrated from 1996 and went on for over two years till September 1998. The last act of harassment complained of set out in the Re-Amended Defence and Counterclaim was that on 24 March 1997. The nuisance caused by the plaintiffs continued even after the Counterclaim was made. The complaints made by the defendant to the police against the 1st plaintiff, who was at all times a police sergeant, did not have any effect in stopping the 1st plaintiff continuing with harassing her. We have not been shown anything to justify our interfering with the Judge's exercise of discretion in granting the injunctions. In the circumstances, this part of the appeal also fails.

32. While Mr Hung challenges the injunctions, he informs us that the 1st plaintiff is willing to give an undertaking to this Court that he will not commit any of the acts enjoined by the injunctions granted by the Judge in case we dismiss this part of the appeal. Yet we cannot help feeling that there is a certain amount of reluctance in the offering of such an undertaking because Mr Hung comments that such an undertaking will have similar damaging effect as the injunctions on the 1st plaintiff. Ms Remedios does not unconditionally consent to the undertaking in lieu of the injunctions. She is prepared, however, to take the position that her client will accept the undertaking if we feel it is proper. In such circumstances, we do not think it right for us to accept the undertaking and discharge the injunctions. Any application in this regard should be made to the Judge.

Conclusion

33. This appeal is an attempt to challenge the Judge's findings of facts which is doomed to failure. We find it difficult to understand why legal aid was granted to the plaintiffs to pursue this appeal, which is totally without merit. We dismiss the appeal and make an order nisi that the defendant do have the costs of this appeal, to be borne by the 1st plaintiff. The plaintiffs' own costs be taxed in accordance with the Legal Aid Regulations.

Representation:

Mr Andy Hung, instructed by Messrs Lo, Chan & Leung, for the 1st and 2nd Plaintiffs (Appellants)

Ms Lisa Remedios, instructed by Messrs Cheng, Yeung & Co, for the Defendant (Respondent).