Wu Siu Fan and Another v. Yip Yuk Chee Juspine and Another

HCA 37/2022 and
HCA 378/2022
(Consolidated)

[2026] HKCFI 5505

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NOS 37 OF 2022 AND 378 OF 2022

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(Consolidated by the Order of Master Matthew Leung dated 7 June 2022)

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JUDGMENT

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TABLE OF CONTENTS

Paragraph

A.  INTRODUCTION

1.These consolidated proceedings can be divided into 2 parts:

(1)  Part I concerns the ownership of four groups of landed properties in Hong Kong (“the Four Properties”), which are as follows:

(a)  4^th Floor, No.28 Belleview Drive, Repulse Bay Garden, No.18-40 Belleview Drive, Hong Kong with carpark numbered G33 (“Repulse Bay Property”);

(b)  Flats B, C, D, E on Ground Floor, and Flats A, B, C, D on 1^st Floor, No.152-156 Aberdeen Main Road, Hong Kong (“Aberdeen 152 Property”);

(c)  No.153 Aberdeen Main Road and No.2 Wu Pak Street, Hong Kong (“Aberdeen 153 Property”); and

(d)  Flat A, G/F, 26 Discovery Bay Road, Coastline Villa (“Discovery Bay Property”).

(2)  Part II concerns a cheque for HK$1.2 million signed by the 1^st plaintiff (“Wu”) on or about 27 October 2014 (“the Cheque”).

2.The disputes in these proceedings are disputes among family members.  Wu and the 2^nd plaintiff (“Chen”) have a close relationship.  According to the plaintiffs’ case, Chen was and is Wu’s honorary son (“誼子”).  According to the defendants’ case, Chen was and is Wu’s boyfriend.  Wu and Chen (“Ps”) together sue the 1^st defendant and the 2^nd defendant (“Juspine” and “Jason” respectively, “Ds” collectively”).  Juspine is Wu’s adopted daughter and Jason’s natural mother.

3.In this trial, Mr Victor Dawes SC, leading Mr Vincent Chen, represent Ps.  Mr Robert Pang SC, leading Mr Brian Tsui, represent Ds.

B.  BACKGROUND[1]

4.Wu was born in 1933.  She could not understand English but could understand and read Chinese.  She was married to her late husband Yip Hoi Bor in 1956.  Her late husband passed away in 1993.

5.On 13 February 1987, Wu became the registered owner of the Repulse Bay Property.

6.After the death of her late husband on 6 January 1993, by the operation of survivorship, Wu became the registered owner of the Aberdeen 152 Property and the Aberdeen 153 Property.

7.On 8 July 1996, Wu purchased the Discovery Bay Property.

8.On 25 April 2007, by 4 deeds of gifts, Wu and her son Yip Wai Ki (“Yip”) became the joint owners of the Four Properties.

9.On 19 March 2009, by 4 notices of severance of joint tenancy, the Four Properties became held by Wu and Yip as tenants in common in equal shares.  Thereafter, at all times, Yip was and is an owner of ½ interest in each of the Four Properties.

10.On 21 March 2009, by 4 deeds of gift executed by Wu, Wu’s interests in the Four Properties (being the ½ interest in each of the Four Properties) became held by Chen, Juspine and Wu as joint tenants.

11.At the same time, Juspine and Chen signed a Chinese document titled as “承諾契約” (“Written Undertaking”), by which promises were made respectively by Juspine and Chen to Wu.  The contents of the Written Undertaking are as follows:

“致：胡少芬女士

基於閣下接受我們倆人，葉玉枝和陳堅強的要求，同意無償將自己在下述四個物業上的權益送贈給我們倆人與你共同聯名持有，並以 “聯權共有” 形式共同持有該些物業之一半業權，我們倆人共同或各別特此在無附帶條件的前提下向你作出以下不可撤銷的承諾及保證：

1. 我們同意你繼續擁有[Repulse Bay Property]的獨有《管有權》、《使用權》、《佔用權》或《享用權》和《租賃權》，該等權益和權利不會因我們三人共同持物業的權益而受任何限制，直至你自願放棄爲止；並承諾在你使用和享用期時，我們任何一方不會要求你遷出該物業。

2. 我們同意你繼續擁有在下列物業的獨有《管有權》、《使用權》、《佔用權》或《享用權》和《租賃權》，該等權益和權利不會因我們三人共同持有物業的權益而受任何限制，你並享有收取租金的絕對權利及無須與我們分享，直至你自願放棄爲止：

(i) [Aberdeen 152 Property];

(ii) [Aberdeen 153 Property]; 及

(iii) [Discovery Bay Property]。

3. 未獲得你的預早同意或准許前，我們任何一人不會自行更改或促使更改共同持有這四個物業之一半業權的現狀，並承諾繼續以 “聯權共有” 形式共同持有。

4. 如我們任何一人違反任何承諾或保證，違反承諾人必須將持有全部以四個物業的權益以無償和無附帶條件將全部業權轉讓給你胡少芬女士。爲確保我們遵守以上承諾及保證，我們倆人共同或各別在此委任你胡少芬女士爲我們各人的法定授權代表，在違反承諾人已違反任何承諾或保證的前提下，授權你代表違反承諾人以法定授權代表身份簽署有關 “送贈契約” 或所需物業轉讓契約；違反承諾人同意及接受有關授權簽署契約行為是對違反承諾人具有法律約束效力，不會提出異議或抗辯。

立契約日期：2009/3/21”

12.The Written Undertaking was signed by Juspine and Chen before a solicitor, Mr Pang Siu Yin (“Mr Pang”).  Beside each signature, there is a red wafer.

13.On 30 September 2013, a charging order nisi dated 18 September 2013 was registered at the Land Registry against Chen’s interest in the Repulse Bay Property (“the 2013 Charging Order”).  The judgment creditor and the judgment debtor under the 2013 Charging Order were Iun Chi Va and Chen respectively.

14.On 7 February 2014, a handwritten Chinese document (“Letter of Agreement”) was signed by Wu (according to Ds’ case but denied by Wu[2]). The contents of the Letter of Agreement are as follows:

“本人[Wu]同意將於2009年3月21日曾轉讓給[Chen]的物業權益全部轉移給[Jason]”

15.On 5 March 2014, a Chinese document (“Letter of Authorisation”) was (according to Ds’ case but denied by Wu[3]) signed by Wu.

16.On 24 April 2014, a charging order nisi dated 17 April 2014 was registered at the Land Registry against Chen’s interest in the Repulse Bay Property (“the 2014 Charging Order”). The judgment creditor and the judgment debtor under the 2014 Charging Order were BOC Credit Card (International) Limited and Chen respectively.

17.On 22 May 2014, the 2014 Charging Order was discharged.

18.On 10 June 2014, by way of a second mortgage, Chen’s share in the Discovery Bay Property was mortgaged and charged to Credit One Finance Limited (“the 2014 Discovery Bay Second Mortgage”).

19.On 16 June 2014, by a Notice of Severance of Joint Tenancy from Chen to Wu and Juspine, Chen’s share in the Aberdeen 153 Property became held by him as a tenant in common.  On the same date, by way of a mortgage, Chen’s 1/6 share in the Aberdeen 153 Property was mortgaged and charged to Credit One Finance Limited (“the 2014 Aberdeen 153 First Mortgage”).

20.On 12 July 2014, by way of a second legal charge, Chen’s 1/6 share in the Aberdeen 153 Property was mortgaged and charged to Mok Keng Chong (“the 2014 Aberdeen 153 Second Mortgage”).

21.On 25 July 2014, Wu represented by Wilson Yeung & Co, commenced proceedings (ie HCA 1414/2014) against the estate of Tse Chun Ming deceased, claiming that the estate was holding some properties (not the Four Properties) on trust for Wu.

22.On 19 September 2014, the 2013 Charging Order was discharged.

23.On 29 September 2014, Juspine and Jason took Wu to a KFC restaurant in Aberdeen to meet two ladies.  The two ladies were staff members of Wilson Yeung & Co.  One of them was a clerk, Sweetie Chan, and the other lady was a trainee solicitor.  In that meeting (“the KFC Meeting”), four assignments (“the Repulse bay Assignment”, the “Aberdeen 152 Assignment”, “the Aberdeen 153 Assignment” and “the Discovery Bay Assignment” respectively, and “the Four Assignments” collectively) were executed by Wu.  Wu executed each of the Four Assignments as the attorney for Chen (Chen being the assignor) and as a confirmor.  On the face of the Four Assignments, Chen’s interests in the Four Properties were assigned to Jason (Jason being the assignee) by the assignments.

24.Each of the Four Assignments contains the following recitals:

“(1) By 4 Deeds of Gift all dated 21^st March 2009 registered in the Land Registry …… made between the Confirmor of the one part and the Confirmor, the Assignor and Yip Yuk Chee Juspine (葉玉枝) of the other part, all the Confirmor’s estate right title benefit and interest of and in [the Four Properties] were assigned respectively by the Confirmor as donor to the Confirmor, the Assignor and Yip Yuk Chee Juspine (葉玉枝) as donees and as Joint Tenants.

(2) By a Deed of Undertaking dated 21 March 2009 (“the Deed of Undertaking”)[4] as annexed hereto, the Assignor agreed, covenanted and undertook to the Confirmor, inter alia, that the Assignor would not change or cause to change the current status of joint tenancy in respect of the Properties and would continue to hold the Properties together with the Confirmor and Yip Yuk Chee Juspine (葉玉枝) as Joint Tenants and that if the Assignor violates or is in breach of the aforesaid term, condition, undertaking, agreement and/or covenant, the Assignor shall without compensation and unconditionally transfer back all his interest in the Properties to the Confirmor.

(3) In wrongful breach of the Deed of Undertaking, the Assignor severed the existing joint tenancy in respect of [the Aberdeen 153 Property] by a Notice of Severance of Joint Tenancy signed by him dated 16 June 2014 and registered in the Land Registry … charged and/or assigned to Credit One Finance Limited ("Credit One") the Assignor’s interest in the 153 Property (as defined in the First Schedule hereto) by a Legal Charge/Mortgage dated 16 June 2014 and registered in the Land Registry … and charged and/or assigned to one Mok Keng Chong the Assignor's interest in [the Aberdeen 153 Property] by a Second Legal Charge dated 18 July 2014 and registered in the Land Registry …

(4) Further, in wrongful breach of the Deed of Undertaking, the Assignor charged and/or assigned to Credit One the Defendant's interest in the Discovery Bay Property by a Second Mortgage dated 10 June 2014 and registered in the Land Registry …

(5) As a result, the original status of joint tenancy in respect of [the Four Properties held by Confirmor, the Assignor and Yip Yuk Chee Juspine (葉玉枝) has thereby been wholly changed, varied, affected and disrupted.

(6) Pursuant to the Deed of Undertaking, the Confirmor has decided and determined to exercise her power and rights thereunder and acted as lawful attorney of Assignor to transfer all the Assignor’s in estate right title benefit and interest of and in the property more particularly described in the Second Schedule hereto (“the Property”) back to the Confirmor, but no Assignment thereof has yet been executed.” (Emphasis added)

25.The Repulse Bay Assignment, the Aberdeen 152 Assignment and the Aberdeen 153 Assignment, contain a recital (7), which is as follows:

“(7) The Assignee is the lawful grandson of the Confirmor. The Confirmor has now agreed to sell and the Assignee has agreed to purchase the Property for the price of HK$2,000,000.00.”

26.The Discovery Bay Assignment contains the same recital (7), save that the price therein is HK$1 million..

27.According to Ds, there was a conversation on 22 October 2014, in which Wu, Juspine and Jason participated.  That conversation was recorded by Juspine without Wu’s knowledge.  Ds have produced the audio recording (“Audio Recording”) as evidence in the trial.  Pursuant to the directions given by this Court on 17 April 2026, the parties have prepared an agreed transcript of the Audio Recording (“the Agreed Transcript”).

28.Regarding the Audio Recording, at the opening submissions stage, Mr Pang SC urged me to attach weight to the Audio Recording, for the authenticity of the recording had never been disputed, and there was no complaint that any of Wu’s statements therein were taken out of context.  In principle, it would not be different from Juspine or Jason giving oral testimony of the conversation, except that the recording would be a far more accurate record of a conversation than human recollection.  On the other hand, Mr Dawes SC, relying upon Chau Yuet Ching Brenda v. Chan Bo Man William[5], submitted that weight should not be attached to the Audio Recording, for the conversation therein was secretly recorded without Wu’s knowledge and consent.  However, at the final submissions stage, Mr Dawes SC submitted that that the Audio Recording was made at a time less than a month after the execution of the Four Assignments, and should be important contemporaneous evidence.  Having considered the parties’ respective submissions, and having noticed the position adopted by Mr Dawes SC in his final submissions, I would attach weight to the Audio Recording and use the same as a piece of contemporaneous evidence in assessing the witnesses’ evidence.

29.On 27 October 2014, Wu signed the Cheque.  The Cheque is a crossed cheque.  The payee thereon is “Wilson Yeung & Co”.

30.Also on 27 October 2014, a writ of summons (ie HCA 2153/2014) was issued in the High Court in Wu’s name, suing Chen.  The statement of claim in that case (“the 2153 SOC”) was verified by a statement of truth signed by Yeung Shu Lam Wilson (“Wilson Yeung”), the sole proprietor of Wilson Yeung & Co.  The claim in that case was to seek reliefs against Chen as a result of breach of the Written Undertaking by Chen.

31.On 28 October 2014, the Four Assignments were registered in the Land Registry.

32.On 3 November 2014, Wu signed a handwritten note, in which Wu said:

“本人胡少芬較早前控告陳堅強，HCA 2153/2014，現在充分考慮下，決定放棄以上訴訟，請貴行Wilson Yeung & Co即日撤銷所有官司，永不追究。”

33.On the same date, Wilson Yeung & Co filed a notice of discontinuance in HCA 2153/2014.

34.At the material times, Wilson Yeung was Juspine’s boyfriend.  Wilson Yeung & Co ceased business on 8 January 2015.  Wilson Yeung passed away on 6 May 2015.

35.On 18 February 2015, the 2014 Aberdeen 153 Second Mortgage was discharged.

36.In March 2015, Wu commenced legal proceedings against Jason (ie HCA 479/2015) and claimed for a declaration that the Four Assignments were of no effect.  Wu also made a complaint to the Police and claimed that Juspine defrauded her into signing some blank papers.  One of those papers were subsequently used to make out the Letter of Authorisation.

37.On 1 June 2015, Wu discontinued HCA 479/2015 but started a new case against Juspine and Jason, ie HCA 1210/2015.  The amended statement of claim in that case (“the 1210 ASOC”) was verified by a statement of truth signed by Wu.  Below the statement of truth signed by Wu, there is a declaration signed by Wu’s solicitor (a Mr Chu), declaring that the solicitor had explained the contents of 1210 ASOC to Wu and Wu appeared to understand the same.  In that case, Wu claimed for, inter alia, a declaration that the Four Assignments were of no effect.

38.On 10 June 2016, Chen’s 1/6 share in the Aberdeen 153 Property was sold pursuant to the 2014 Aberdeen 153 First Mortgage via auction at HK$7.5 million.

39.On 1 December 2016, the 2014 Discovery Bay Second Mortgage was discharged.

40.In HCA 1210/2015, Wu obtained default judgments against Juspine and Jason on 25 April 2017 and 22 August 2017 respectively.  On 19 September 2019, the default judgments were set aside on the ground that the judgments obtained were irregular judgments.

41.On 21 September 2020, Wu, accompanied by Chen, went to the Aberdeen Police Station and made a statement (“the 2020 Police Statement”).  In that statement, Wu made complaints against Juspine and Jason.  Wu said that the Four Assignments were unlawful, for her signatures on those documents were procured by deceit.

42.On 13 November 2020, Wu withdrew the proceedings in HCA 1210/2015.

43.On 31 December 2020, Jason through his solicitors deposited HK$5 million into Wu’s bank account as consideration for the Repulse Bay Assignment, Aberdeen 152 Assignment and Discovery Bay Assignment.  On 9 January 2021, Wu refused to accept the said consideration and return the HK$5 million to Jason’s solicitors.

C.  THE PARTIES’ RESPECTIVE CLAIMS AND THE ISSUES

44.As said at the beginning of this judgment, these proceedings can be divided into 2 parts.  Part I concerns the validity of the Four Assignments.  Part II concerns the Cheque.

C1.  Part I

45.For Part I, Ps’ case is as follows:

(1)  On or about 29 Sept 2014, after having yum cha in Aberdeen, Juspine and Jason suddenly took Wu to a KFC restaurant in Aberdeen.  There, Wu was met by two unknown ladies.

(2)  Wu could not read English and was about 81 years old at that time.  In the KFC Meeting, Wu was asked to sign several English documents.

(3)  No proper explanation of the nature, contents, or legal effect of the documents was given to Wu in the KFC Meeting.

(4)  When Wu asked Juspine what she was signing, Juspine replied words to the effect: “簽啦阿媽，唔會害你”.

(5)  At that time, Wu believed the documents related to another ongoing matter (ie HCA 1414/2014) and signed them in reliance on her trust in Juspine and Jason.

(6)  Had she known the documents were assignments transferring Chen’s valuable property interests to Jason, Wu would never have signed them.

(7)  By reason of non est factum and/or misrepresentation, the Four Assignments should not be regarded as having any legal effect.

(8)  Alternatively, Wu could not derive authority from the Written Undertaking to sign the Four Assignments on behalf of Chen.  The Four Assignments are not binding upon Chen.

(9)  In the further alternative, by failing to pay the consideration as stipulated in the Four Assignments, Jason has committed a repudiatory breach of the contracts as contained in the Four Assignments.  By commencing HCA 1210/2015 against Juspine and Jason on 1 June 2015 seeking a declaration that the Four Assignments were invalid, Wu has accepted the repudiation and terminated the contracts.

(10)  As to the Letter of Agreement:

(a)  Wu has never seen or signed this document.  The signature on the document is not her signature.

(b)  Even if the signature is hers (which she does not admit), she never agreed to its contents.  If the signature is hers, she suspects that the document was prepared on a blank piece of paper that she had signed, and the contents were added afterwards.

(11)  As to the Letter of Authorisation:

(a)  Wu has never signed any general power of attorney in favour of Juspine.

(b)  At Juspine’s request and because of the trust reposed on her adopted daughter, Wu signed on a blank piece of paper.  Juspine told Wu that it was needed so that Juspine could (a) handle HCA 1414/2014, and (b) deal with the Food and Environmental Hygiene Department regarding the transfer of two market stalls in Aberdeen.

(c)  Wu later asked for the signed blank paper back, but Juspine refused to return it.  Wu believes that the Letter of Authorisation was created by adding the contents onto the blank signed paper afterwards.

(d)  In any event, any authority created under the Letter of Authorisation was revoked by Wu.

46.Ps claims against Ds for, inter alia, (a) a declaration that the Four Assignments are of no legal effect; (b) a declaration that the Letter of Agreement and the Letter of Authorisation are of no effect; (c) a declaration that Chen is a true 1/6 beneficial owner of the Repulse Bay Property, the Aberdeen 152 Property, and the Discovery Bay Property; and (d) damages.

47.Ds’ case is that:

(1)  Chen incurred many debts as a result of his gambling habits.  In order to preserve the Four Properties, after discussion with Juspine, Wu agreed to transfer Chen’s interests in the Four Properties to her grandson, Jason.

(2)  The KFC Meeting was pre-arranged by Wilson Yeung.  Wilson Yeung sent Sweetie Chan and a trainee solicitor to the KFC restaurant to meet Wu.

(3)  At the KFC Meeting, Sweetie Chan fully explained the contents and effect of the Four Assignments to Wu in Cantonese.  Wu was asked to confirm that she wished to transfer Chen’s 1/6 shares in the Four Properties to Jason. Wu confirmed her intention to do so. Only after all these, Wu signed the Four Assignments.  Sweetie Chan witnessed Wu’s signatures on the documents.

(4)  The Letter of Agreement and the Letter of Authorisation were documents duly signed by Wu.

48.Jason counterclaims for, inter alia, (a) a declaration that Jason is the legal and beneficial owner of 1/6 interests in the Repulse Bay Property, the Aberdeen 152 Property, and the Discovery Bay Property; (b) an order requiring Wu to give an account of the occupation status of and the rental incomes derived from these properties; and (c) damages.

C2.  Part II

49.Part II is a claim based upon the Cheque.  This is a claim made by Wu against Juspine.

50.For Part II, Wu’s case is that :

(1)  Wu was misled by Juspine into signing the Cheque on or about 27 October 2014.  Wu was told that the amount of the Cheque was just HK$12,000, as opposed to HK$1.2 million and it was for repayment of some debts owed by Wu to Juspine.  Wu signed the Cheque because of the trust Wu then had in Juspine.

(2)  Wu did not pay attention to the payee of the Cheque and only discovered at a later time that it was made out to Wilson Yeung & Co.  When Wu questioned the payment, Juspine changed her story and told Wu that the money was for the payment of some stamp duty.

(3)  By reason of Juspine’s misrepresentation, Juspine is liable to pay damages to Wu.

51.Juspine’s case is that on 27 October 2014, when Wu signed the Cheque, Wu knew that the Cheque was for fees and expenses relating to the transfer of the interest in the Four Properties to Jason, costs on account for HCA 2153/2014, stamp duty for the Four Assignments and costs on account for HCA 1414/2014.  There is no basis upon which Wu may claim against Juspine by reason of the Cheque.

C3.  The Issues

52.After hearing the parties’ respective opening submissions, Mr Dawes SC and Mr Pang SC have helpful provided me a Revised Agreed List of Issues.  In my view, the issues to be resolved in this trial are as follows:

(1)  Whether Wu signed the Letter of Agreement dated 7 February 2014 with knowledge and understanding[6];

(2)  Whether Wu signed the Letter of Authorisation made on 5 March 2014 with knowledge and understanding[7];

(3)  Whether the Four Assignments were executed by Wu with knowledge and understanding of their contents and whether the Four Assignments should be set aside or declared void on the basis of non est factum;

(4)  Whether Wu’s claim on misrepresentation has been properly pleaded? If so, whether Wu’s claim on misrepresentation is proved which induced her into executing the Four Assignments;

(5)  Whether Wu had the authority to assign Chen’s interests to Jason, by the Four Assignments, pursuant to power of attorney under the Written Undertaking, including:

(a)  Whether the condition precedent under the Written Undertaking was satisfied;

(b)  Whether the Written Undertaking authorised Wu to transfer Chen’s interests in the Four Properties to any person other than Wu? and

(c)  Whether the Written Undertaking was executed as a Deed;

(6)  In the event that the Written Undertaking was not executed as a deed, was it executed as a contract?  If so, what is the effect of the Written Undertaking on the Four Assignments;

(7)  Whether the Four Assignments contained an implied term that Jason was obliged to pay the stated consideration under the Four Assignments within a reasonable time (ie on or before 1 June 2015);

(8)  Whether there is a legally binding side agreement between Wu and Jason whereby Wu orally permitted Jason to pay the consideration only when he had the financial means to do so;

(9)  Whether Jason’s failure to pay the stated consideration under the Four Assignments for a period of 6 years constituted a repudiatory breach, and whether Wu accepted Jason’s repudiatory breach and thereby terminated the Four Assignments;

(10)  Whether the Four Assignments were executed or executory such that by accepting Jason’s repudiatory breach, the assignments thereunder were unwound?

(11)  In respect of the Cheque, whether Wu’s claim on misrepresentation has been properly pleaded and whether Wu was misled by Juspine in signing the Cheque such that Juspine should compensate Wu in the sum of HK$1.2 million;

(12)  In respect of Jason’s counterclaim, whether Wu is liable to account to Jason the rental income of the Discovery Bay Property and the Aberdeen 152 Property and mesne profits for the Repulse Bay Property.

D.  THE WITNESSES’ EVIDENCE

D1.  The principles

53.The principles concerning assessment of evidence given by witnesses are trite.  The Court would take into account the following[8]:

(1)  Whether the party’s case is inherently plausible or implausible;

(2)  Whether the party’s case is, in a material way, contradicted by other evidence (documentary or otherwise) which is undisputed or indisputable;

(3)  Where it is shown that a witness has been discredited over one or more matters to which he has given evidence using the above tests.  This is relevant to the assessment; and

(4)  the demeanour of the witnesses.

54.The reminder given by DHCJ Eugene Fung (as he then was) in Hui Cheung Fai v Daiwa Development Limited[9] is also relevant:

“77. Generally speaking, contemporaneous written documents and documents which came into existence before the problems in question emerged are of the greatest importance in assessing credibility: Onassis v Vergottis [1968] 2 Lloyd’s Rep 403 at 431 (Lord Pearce).  It is right to point out, however, that some of the documents in this case are alleged by the Son to be shams and those documents obviously cannot be used to assess the credibility of the parties.

78. In deciding whether to accept a witness’ account, importance should also be attached to the inherent likelihood or unlikelihood of an event having happened, or the apparent logic of events: eg Lam Rogerio Sou Fung v Tan Soon Gin George (unreported, HCA 2576/2005, 5 May 2011) §39 (Chu J).

79. In determining a witness’ credibility, I have also attached importance to the consistency of the witness’ evidence with undisputed or indisputable evidence, and the internal consistency of the witness’ evidence.  The latter type of consistency is often tested by a comparison between the witness’ oral testimony and his or her witness statement.

80. I have cautioned myself against the dangers of too readily drawing conclusions about truthfulness and reliability solely or mainly from the appearance of witnesses (Ting Kwok Keung v Tam Dick Yuen (2002) 5 HKCFAR 336 at §§36-37 (Bokhary PJ)), or from the assessment of the witnesses’ character (Esquire (Electronics) Ltd v HSBC [2007] 3 HKLRD 439 at §135 (Stock JA)).

81. The practical approach to assessing credibility of witnesses in a case such as the present may have best been summarised by the words of Robert Goff LJ, as he then was, in The Ocean Frost [1985] 1 Lloyd’s Rep 1 at 57:

‘Speaking from my experience, I have found it essential in cases of fraud, when considering the credibility of witnesses, always to test their veracity by reference to the objective facts proved independently of their testimony, in particular by reference to the documents in the case, and also to pay particular regard to their motives and to the overall probabilities. It is frequently very difficult to tell whether a witness is telling the truth or not; and where there is a conflict of evidence such as there was in the present case, reference to the objective facts and documents, to the witnesses’ motives, and to the overall probabilities, can be of very great assistance to a judge in ascertaining the truth.’ ”

55.Examples of a witness’s unsatisfactory performance in giving evidence include: evasive and argumentative answers, tangential speeches avoiding the question, blaming legal advisers for pleading, disclosure and evidence shortcomings, self-contradiction, internal inconsistency, shifting case, new evidence, and selective disclosure.[10]

56.While there is a long passage of time between the material events and the trial, contemporaneous documentation is of particular importance.  In Esquire (Electronics) Ltd v Hong Kong and Shanghai Banking Corp Ltd [11], Stock JA (as he then was) said:

“…… Comparison with contemporaneous documentation is always an aid to reliability of oral testimony, unless there is reason to believe that the documentation is contrived or materially incomplete; but where the passage of time between events and trial is as long as it was in the present case, and where there is such a host of contemporaneous documentation, as there was in this case, the documentation must, I would have thought, assume a special importance. ……

I would venture to suggest that the truth, in so far as one is able to reach it or, as is sometimes the case, to reach a version of it that is more likely to be correct than not, can best be tested by reference to contemporaneous documentation where it exists, or to its absence where one would expect it to have been created, as well as to inherent probabilities (though bearing in mind that there may be occasions where the truth may run against that particular grain) having regard to all the facts that are known.  This is particularly so in a case such as the present, where events have taken place so long before trial and where there exists a mountain of contemporaneous documentation that can be used to point the way.  This is not to say that the documentation should have been treated as if it stood on its own, not to be explained, contradicted or supported by oral testimony.  It is however to say that in this case the approach adopted to assessment of the facts placed far too much emphasis on character impression and too little upon what was suggested by the documentation and by the inherent probabilities in their historical context.  That documentation, as well as conflicts within the evidence, inherent probabilities, and a study of how matters were originally pleaded and asserted in witness statements – these are the factors which in a trial such as this, so long removed from the time of the events in question, were likely to be of particular use in assessing the facts ……” (Emphasis added)

57.While contemporaneous documentation is important, in respect of disputes between family members, the following have to be borne in mind:

(1)  In Chen Tek Yee & Ors v. Chan Moon Shing[12], Yuen JA said:-

“29. …… when the parties are in a personal relationship (as contrasted with parties in a commercial transaction), it would be unrealistic to expect written records of assurances ……”

(2)  Similarly, in Cheung Lai Mui v. Cheung Wai Shing & Ors[13]^, Wilson Chan J said:

“95. …… Members of the family dealt with each other on the basis of trust, not mistrust.  They could not have envisaged litigation in the future, and they would not have generated records to protect themselves out of the blue.”

58.The Court would approach the self-serving statements made by a witness with circumspection, but would give considerable weight to the statements made by him which are against his interest.  See Wong Tak Yue v Kung Kwok Wai & Another (No 2)[14]:

Per Li CJ[15]:

“Where the occupier has made self-serving statements as to what was his intention, whether during the period of occupation or when challenged in legal proceedings, the courts should approach them with some scepticism.  The courts would scrutinize the circumstances in which they were made and would give them such weight if any as they may deserve. Conversely, where the occupier has made statements as to what was his intention and such statements are against his interest, the courts would usually accord to them considerable weight.” (Emphasis added)

Per Litton PJ[16]:

“Here, the appellant has come nowhere near establishing adverse possession.  He unequivocally declared that at all times he was ready willing and able to pay rent to the owners, and did not do so only because no one came along on behalf of the landlords to collect rent.  Whether his acts and declarations in the course of the 1980 court proceedings amounted to an acknowledgment of the owners’ title in terms of s.23(1), or fell short of that, the fact remains that he had no intention to exclude the owners.” (Emphasis added)

Per Ching PJ[17]:

“I need only add that there can be no better evidence of the intention of an occupier of land than his express declaration against his own interest.” (Emphasis added)

The aforesaid principle is not limited to adverse possession cases but has a general application.  See Leung Siu Man and Ors v Leung Yiu Tai[18], and 章晶歷 v 吳聯模 and Anor[19].

59.Unless a recognized legal basis for concluding otherwise is shown, a person is bound by a document signed by him or her.  In Ming Shiu Chung & Others v Ming Shiu Sum & Others[20], Ribeiro PJ said:

“84. …… Reliance is universally placed on signatures appended to documents by persons of full age and understanding as signifying the signatory’s assent or adherence to what that document states.  Where such a person has signed a document which purports to have legal effect, the law has never regarded it as enough to show that he signed without knowing its contents for the document to be disavowed.  It is an everyday occurrence that people sign documents without reading the small (or even the large) print and therefore sign without actually knowing the terms (or all the terms) of the document signed.  But they are held to the documents which they have chosen to sign unless there is shown to be a recognized legal basis for concluding that their apparent consent has been in some way vitiated or that reliance on that document by some other person falls into some category of unconscionable conduct justifying relief in equity.” (Emphasis added)

60.The standard of proof in civil cases, in which serious allegations of misconduct such as fraud is in issue, is on the preponderance of probabilities, and the degree of probability must be commensurate with the occasion.  That does not mean that the Court is looking to a degree of probability higher than the civil standard.  It means that the more inherently improbable the act in question, the more compelling will be the evidence needed to satisfy the court on a preponderance of probability.[21]

61.As to whether adverse inferences should be drawn against a party, the following would need to be borne in mind:

(1)  In Hua Tyan Development Ltd v Zurich Insurance Co Ltd[22], Ma CJ said:

“46. It was submitted, however, that the Assured having raised a prima facie case on the facts of actual knowledge, this prima facie position should be taken factually to be the established position in the absence of any contradictory evidence adduced by the Insured.  In other words, a prima facie case on the facts having been raised, adverse inferences could be drawn from the failure to adduce contradictory evidence, particularly where a party could be expected to provide such evidence; in such situations silence would be fatal.

47. However, before a prima facie factual situation can be said to exist, there must be evidence adduced of “sufficient cogency” to raise a prima facie case in the first place.  The Assured did not reach this threshold.  In its Written Case, reliance was placed on the Statement of Claim in which there was admittedly a reference (without any particulars) to actual knowledge; reliance was alsoplaced on the fact that information on the Vessel’s deadweight capacity could be found on the Internet.  These were insufficient by a long way to make out a prima facie case on knowledge.” (Emphasis added)

(2) The silence of one party in the face of the other party’s evidence may convert that evidence into proof in relation to matters which are, or are likely to be, within the knowledge of the silent party and about which that party could be expected to give evidence. Thus, depending on the circumstances, a prima facie case may become a strong or even an overwhelming case. But, if the silent party’s failure to give evidence (or to give the necessary evidence) can be credibly explained, even if not entirely justified, the effect of his silence in favour of the other party, may be either reduced or nullified.[23]

62.With the aforesaid principles in mind, I now turn to the evidence.

D2.  Ps’ witnesses

63.Wu and Chen have given evidence in support of Ps’ case.

D2.1  Wu

64.At the time of the trial, Wu is at the age of 93.  She has some hearing problems and is wearing her own hearing aid.  She would easily become emotional in the process of giving evidence in the trial.  Due to the unstable blood pressure and health condition, on day 3 of the trial, Mr Dawes SC and Mr Pang SC agreed to treat her evidence as being completed.  Before that, Mr Pang SC was prepared to have some cross-examination questions on the Audio Recording.  However, due to Wu’s health condition and as a result of the agreement reached between counsel, Mr Pang SC did not proceed to cross-examine Wu further.  Since Mr Dawes SC and Mr Pang SC have agreed to treat Wu’s evidence as being completed, the fact that Wu’s evidence ended at a time earlier than expected should not be treated as a factor in favour of or against Wu in assessing the reliability of her evidence.

65.In assessing Wu’s evidence, I bear in mind Wu’s age and her hearing problems.  She received little education and could not understand English.  Sometimes she would become very emotional while she was giving evidence in the witness box.  All these would not be matters against Wu in assessing her evidence.

66.With all the aforesaid in mind, after considering Wu’s evidence carefully, I find that Wu is an unreliable witness.  Her evidence is contradicted by indisputable documents on various material aspects and is inherently improbable on the crucial issues in these proceedings.  She is evasive, often making tangential speeches to avoid questions from counsel during cross-examination.  Save and except the matters agreed or not disputed by Ds, the matters as shown in indisputable documents, and the admissions made by Wu against Ps’ interest, I refuse to accept Wu’s evidence.  As to the admissions made by Wu against Ps’ interest, I attach weight to those admissions.

67.In considering Wu’s evidence, Wu’s background and character would need to be borne in mind.

(1)  As submitted by Mr Pang SC:

(a)  Wu is a woman of substantial wealth.  She inherited the shares in Aberdeen Winner Investment Limited (“AWIL”) from her late husband. Subsequently, Wu held the shares in AWIL via a BVI company.  Wu also knew that Juspine and Yip held the shares in the BVI company on trust for her.  Wu also has interests in various landed properties.

(b)  Wu is a woman who is capable of protecting her own rights and interests. She is also someone who is always alive to the real possibility of being abused or taken advantage of:

(i)  In February, 2009, she commenced the legal proceedings in HCA 336/2009 against Yip for fraud.

(ii)  In March 2009, she made a report to the Police relating to a complaint of fraud perpetrated by Yip on her.  She alleged that she was asked by Yip to sign a number of documents without any explanation to her. The documents turned out to be certain deeds of gift giving away Wu’s interests in the Four Properties to Yip.

(iii)  According to Wu, although she agreed to give some of her interests to Juspine as gifts, she had sought independent legal advice from her own solicitor Mr Pang and taken precautions to protect her own interests.  In her witness statement, Wu said:

“62． 大約於2009年2、3月，因為契仔陳堅強已答應搬來我住所照顧我及至本人終老，我決定將該四個物業的一部分送贈給他。事實上，我知道陳堅強經常有到不同地方出埠登台演出的機會，但是為了留在香港照顧我，他推辭了很多工作。於是我與他商量，打算將我於該四個物業之一半業權送贈給他與我聯權共同持有，以作答謝及補償於他。

63． 本來我並無打算亦將該四個物業的一部份送贈給養女葉玉枝。她一早已從我和先夫獲得了數千萬財產，而且我已有送給她其他物業，加上現在她又不照顧我，我不想讓她再有得益。但陳堅強為她講好話，並說他自己有時可能工作忙，未必可以照顧得我周全，建議我如果葉玉枝應承回來一同照顧我的話，就讓我亦將該四個物業的一部份送贈給葉玉枝。

64． 在得到我同意後，陳堅強打電話通知葉玉枝並約她與我見面飲茶。葉玉枝見到我後，向我斟茶認錯，邊哭邊請求我原諒，並答應回來照顧我，讓我亦將該四個物業的一部份送贈給她。為此，我原諒了葉玉枝。

65． 雖然葉玉枝表面上有答應我不再與楊律師交往，但是，我知道當時葉玉枝與楊律師仍是男女朋友的關係。我擔心楊律師會聯同葉玉枝騙走我的資產。為了提防他們，及確保我在簽署送贈契後在物業上的管有權和享用權，我特意諮詢律師 (梁陳彭律師行的彭兆賢律師) 的意見。按照彭律師的建議，及為了公平起見：

(1) 於2009年3月21日，透過4份饋贈契約，將該四個物業之一半業權改由我本人、葉玉枝及陳堅強以長命契的形式共同持有。

(2) 同一時間，我要求葉玉枝及陳堅強簽訂一份「承諾契约」(「該承諾契約」)，向我作出一系列的承諾，包括我可繼續居住於淺水灣物業及獨自享有香港仔152號物業、香港仔153號物業及愉景灣物業的租金收入等權益。

(3)  這份「承諾契約」只有一份正本，一直由彭律師保管。直至後來我發現葉玉枝企圖利用這份「承諾契約」將陳堅強於該四個物業的業權轉給鍾樂謙，我才到梁陳彭律師行取回「承諾契約」的正本…”

(iv)  Wu had made use of some trust arrangement to hold certain properties (not the Four Properties) through Tse Chun Ming, with Tse Chun Ming acting as a trustee for her.  In July 2014, she commenced the legal proceedings in HCA 1414/2014 against the administratrix of the estate of Tse Chun Ming for recovery of her interest in those properties.

(2)  In her oral evidence, Wu claimed that she only had received education for two or three years.  I do not accept her claim.  In my view, Wu had received education up to junior secondary school level, and she could understand Chinese documents without difficulties.

(a)  In the 2020 Police Statement, Wu described herself as having “初中程度”, and she “懂得閱讀及書寫中文”.  While she was giving evidence, when being asked why she said she had “初中程度”in the 2020 Police Statement, she denied that she had such high education level and explained that she spoke incorrectly when she was making the police statement (“我講錯咗囉”).  I refuse to accept Wu’s explanation.  She would not mention “初中程度”out of the blue when she was making that statement.  Further, at the end of that statement, Wu declared that she had read the statement and knew that she could amend anything therein.  If her education was misstated in that statement, no doubt Wu would correct the same.  However, no correction has ever been made. 

(b)  Before Wu gave her evidence in the witness box, Wu made the affirmation required by the law.  Even at the age of 93 and without any assistance, Wu had no difficulty in reading out all the Chinese characters in the affirmation correctly.  This shows that Wu in fact is an educated woman with no difficulty in reading Chinese documents.

(3)  I have also observed Wu carefully while she was giving evidence in the witness box.  Wu had a clear mind and could give a meaningful response if she was willing to answer the question asked by counsel.  In my view, her ability to give evidence has not been undermined by her old age and hearing problems.

68.Wu claimed that at the time when she signed the Four Assignments in the KFC Meeting, she did not know that the purpose of those documents was to take away Chen’s interests in the Four Properties.  She thought that the documents related to matters in HCA 1414/2014.  She said that she only realised the effect of the Four Assignments when Chen and her went to the Land Registry and conducted a search in around January 2015.  Under cross-examination, when being asked why she would go to the Land Registry to conduct a search in around January 2015, Wu said that was because Juspine intended to take away Chen’s interests in the Four Properties.  Wu was further asked why she knew that Juspine intended to do so.  Wu then answered that this was because Juspine asked her to sign documents.  Then it was pointed out to Wu that her answer revealed that she knew the nature of the Four Assignments when she signed the same.  Wu then said she did not know, and she would never take away Chen’s interests in the Four Properties.

69.In my judgment, as to why Wu went to the Land Registry and conducted a search in around January 2015, Wu had given an honest answer – she admitted that she had previously signed documents to remove Chen’s interests in the Four Properties.  After giving this admission, Wu wanted to retract by giving no meaningful response.

70.I agree with Mr Pang SC that when Wu was faced a challenge in cross-examination which she could not provide a satisfactory answer, she simply resorted to her old age, alleged lack of education, or simply repeating that whatever given by her to Chen would forever be Chen’s properties.  All these show that Wu cannot be a reliable witness.

71.It is certainly untrue that Wu regarded whatever given by her to Chen would forever be in Chen’s hands.  According to her own evidence, on 21 March 2009 when she executed 4 deeds of gift to give Juspine and Chen some interests in the Four Properties, Wu required Juspine and Chen to sign the Written Undertaking.  The purpose of the Written Undertaking was to protect Wu’s interest, and to allow Wu to take back what she had given to Juspine and Chen when the events specified in the Written Undertaking occurred.  The Written Undertaking was prepared after Wu seeking legal advice from her own solicitor Mr Pang.  Clearly, Wu had a plan and reserved a right to take back Chen’s interests in the Four Properties if Chen breached the Written Undertaking.

72.Having examined the indisputable evidence, in my judgment, Wu in fact intended to exercise her right under the Written Undertaking to revoke Chen’s interests in the Four Properties and to transfer the same to Jason at the time of executing the Four Assignments on 29 September 2014.

(1)  Wu commenced HCA 2153/2014 against Chen on 27 October 2014.  In the 2153 SOC, Wu pleaded:

“7. Since about 2011, [Chen] has been addicted to gambling and incurred huge debts.

8. In wrongful breach of [the Written Undertaking], [Chen]:-

(a) on 16 June 2014, severed the existing joint tenancy in respect of the half share (1/2) of [the Aberdeen 153 Property] by a Notice of Severance of Joint Tenancy signed by him dated 16 June 2014 Memorial No .14092300330093;

(b) on 16 June 2014, charged and/or assigned to Credit One Finance Limited (“Credit One”) the [Chen] 's interest in the half share (1/2) of [the Aberdeen 153 Property] by a Legal Charge/Mortgage dated 16 June 2014 Memorial No.14070800390166; and

(c) on 18 July 2014, charged and/or assigned to Mok Keng Chong (“Mok”) [Chen]’s interest in the half share (1/2) of [the Aberdeen 153 Property] by a Second Legal Charge dated 18 July 2014 Memorial No. 14072101190023.  Mok is a money lender in Macau.

9. Further, in wrongful breach of [the Written Undertaking], [Chen] on 10 June 2014 charged and/or assigned to Credit One [Chen]’s interest in the half share (1/2) of the Discovery Bay Property by a Second Mortgage dated 10 June 2014 Memorial No.14062700770326.

10. As a result, the original status of joint tenancy in respect of the half share (1/2) of the Properties has thereby been changed, varied, affected and disrupted.  [Wu] has thereby suffered loss and damages.

11.  In the premises, [Chen] was obliged to transfer back all his interest in the half share (1/2) of the Properties to [Wu].”

(2)  Wu claimed that she had never instructed Wilson Yeung & Co to commence HCA 2153/2014 against Chen.  This is untrue.

(a) In the 2020 Police Statement signed by Wu, Wu said: “本人曾經口頭指示及依賴養女葉玉枝為本人處理兩單訴訟。這兩單訴訟分別為(i)高等法院民事訴訟2014 年第 1414 號及(ii)高等法院民事訴訟2014 年第 2153 號 (該訴訟已於按本人指示於2014 年11 月 3 日即日撤銷，完全終止，永不追究。)” (underline added)

These are Wu’s own words, which Wu could no deny.

(b)  In the handwritten note signed by Wu on 3 November 2014 (authenticity not disputed), Wu said: “本人胡少芬較早前控告陳堅強HCA 2153/2014，現在充份考慮下，決定放棄以上訴訟 …” (underline added)

(3)  Clearly, there is indisputable documentary evidence showing that the commencement of HCA 2153/2014 was as a result of Wu’s instruction.  In late October 2014 (the writ of summons in HCA 2153/2014 was issued on 27 October 2014), Wu did intend to take back the interests in the Four Properties from Chen’s hands.

(4)  On 1 June 2015, Wu commenced HCA 1210/2015 against Juspine and Jason.  In the 1210 ASOC, Wu pleaded:

“11.  因為[Chen]之前沉迷賭博，[Wu]於大約2014 年l月決定取回之前轉讓給[Chen]於該四個物業的權益。

12.  由於[Wu]年邁及不諳閱讀中文及英文，加上她當時對[Juspine]的信任，[Wu]便指示[Juspine]為她索回[Chen]於該四個物業的權益。

13.  [Wu]當時向[Juspine]作出的指示是將[Chen]於該四個物業的權益轉讓給胡女士的三位孫兒 (包括[Jason]在內) 以及一位侄兒。……”(underline added)

(5)  Under cross-examination, Wu was referred to the aforesaid part of the 1210 ASOC.  Initially, Wu said that those paragraphs in the 1210 ASOC were not correct, and she would never take back what she had given to Chen.  When she was referred to the statement of truth signed by her verifying the contents of the 1210 ASOC, and the declaration made by the solicitor Mr Chu representing her in that case, Wu could not provide any meaningful response.  At the end, Wu said that initially, she intended to take back the interests in the Four Properties given to Chen, but she changed her mind at a later time. 

(6)  As evidenced by the matters set out in the above, Wu intended to take back the interests in the Four Properties from Chen in about January 2014.  That was her intention up to until late October 2014.  She only changed her mind in early November 2014.

(7)  As shown in the Letter of Agreement signed by Wu on 7 February 2014, Wu had an intention to transfer Chen’s interests to Jason in February 2014.  Under cross-examination, Wu admitted that the signature on the Letter of Agreement was her signature.  However, Wu said that she might (“可能”) have signed on a blank paper.  When Wu was asked what the state of the paper was when she put her signature on the paper, Wu said that she could not recall.  Wu could not be sure whether the words on the Letter of Agreement were already there when she signed the document.  There is no cogent and compelling evidence from Wu showing that Wu first signed on a blank paper, and the contents were added thereon by someone thereafter.  In the circumstances, Wu must be bound by the Letter of Agreement, and the words thereon must be treated as Wu’s own words.

(8)  There is no reliable evidence showing that Wu had changed the aforesaid intention before November 2014.

(9)  The aforesaid conclusion is reinforced by the conversation on 22 October 2014 captured in the Audio Recording.  The Audio Recording shows that at the time of that conversation, (a) Wu knew and disapproved Chen’s conduct of continuously incurring debts and thereby jeopardizing the Four Properties; (b) Wu agreed to transfer Chen’s interests in the Four Properties to Jason; and (c) Wu was contemplating taking legal actions against Chen.

73.  Although the contents of the Four Assignments are in English, the Chinese names of Chen, Juspine and Jason appear at the top of page one of each assignment.  Under cross-examination, Wu agreed that the matters in HCA 1414/2014 were matters completely unrelated to Chen, Juspine and/or Jason.  Wu was asked when she saw the Chinese names of Chen, Juspine and Jason on the documents placed before her in the KFC Meeting, knowing that HCA 1414/2014 had nothing to do with Chen, Juspine and/or Jason, why she would have thought that the documents placed before her concerned the matters in HCA 1414/2014.  Wu said that was because she did not know (“因為我唔懂吖嘛”[24]) In my view, Wu clearly knew the meaning of the question, but she chose to evade the unanswerable question.

74.  Each of the Four Assignments contains a declaration made by Sweetie Chan - “INTERPRETED to the Assignor, the Confirmor and the Assignee”.  Sweetie Chan signed under the declaration.  Sweetie Chan’s signature was verified by Wilson Yeung.  The declaration is a solemn statement made by Sweetie Chan.  I attach weight to the declaration made by Sweetie Chan on each of the Four Assignments.  

75.  Mr Dawes SC submits that the Audio Recording shows that Juspine appeared to inform Wu about Chen’s alleged breaches of the Written Undertaking (set out in the Four Assignments) for the first time in the conversation captured the recording.  Wu showed unfamiliarity and surprise on the charge over the Discovery Bay Property and severance of the joint tenancy in respect of the Aberdeen 153 Property in the conversation, but in fact these matters were expressly set out in the Four Assignments as the basis of Wu’s purported power to transfer Chen’s interest.  These matters had already been mentioned in the Four Assignments.  Had the Four Assignments been fully interpreted or explained to Wu on 29 September 2014, Wu would not be so surprised in the conversation taken place on 22 October 2014.

76.  With respect, I am unable to agree.  In my view, based upon the Audio Recording, there is no sufficient basis to draw an inference that the Four Assignments had not been interpreted or explained to Wu in the KFC Meeting taken place on 29 September 2014.  Applying common sense, even one has read the Four Assignments in detail, one may not be able to recall the details of the contents therein after about one month.  In particular, it has to be borne in mind that in October 2014, Wu was 81 years old.  Given her old age, it would not be a surprise that she would not be able to remember the details of a document explained to her one month ago.  Further, it is important to note that in the conversation taken place on 22 October 2014, neither Juspine nor Wu said that Chen’s breaches of the Written Undertaking had never been raised with Wu before and were raised for the first time in that conversation. 

77.  Regarding the Cheque, Wu gave the following evidence while she was in the witness box:

(1)  When she signed the Cheque, she thought that the amount of the Cheque was HK$120,000.

(2)  It was Chan Man Ngan (“Chan”, Wu’s accounting clerk at that time) who presented the Cheque to Wu for her signature.  At that time, whether Juspine was present at the scene, Wu could not recall.

(3)  When Chan presented the Cheque to Wu, Chan did not say anything.

(4)  When the Cheque was presented to Wu for her signature, the payee’s name and the amount were already written on the Cheque.

78.  Plainly, Wu’s evidence concerning the Cheque is inconsistent with her pleaded case (which was verified by the statement of claim signed by Wu in the Amended Statement of Claim) as set out in §50 above.  The irreconcilable differences between Wu’s pleaded case and Wu’s evidence given in the trial show that Wu in fact does not have a clear memory of the matters relating to the Cheque.  There is no reliable evidence in support of Part II of Wu’s claim.

79.  In view of all the above, I do not regard Wu as a reliable witness.  Save and except the admissions made by Wu which are contrary to the interests of Ps’ case, the matters not disputed by Ds, and the matters shown in the indisputable documentary evidence, I refuse to accept Wu’s evidence.

D2.2 Chen

80.  The exact relationship between Wu and Chen is not an issue in this case, and there is no need for this Court to make a finding on this matter.  The central factual disputes which need to be resolved in this trial is what happened in the KFC Meeting, and what happened when Wu signed the Cheque.  Chen was not present in the KFC Meeting, and Chen was not involved in the events relating to the Cheque.  Hence, Chen in fact does not have any personal knowledge on the matters which are the central contentious factual issues in this case. 

81.  While he was in the witness box, Chen said that Wu did not know about HCA 2153/2014 and did not give any instruction to start that case.  That case was stated by Juspine and Wilson Yeung without Wu’s knowledge and consent.  I refuse to attach weight to these allegations.  Chen did not mention any matter which may form a satisfactory basis in support of these allegations.  These allegations are merely Chen’s subjective belief without support from any objective evidence. 

82.  Under cross-examination, Chen said that he consented to the affixing of the red wafer to his signature on the Written Undertaking.  Chen also agreed that the gifting of the interests in the Four Properties by Wu to Chen and the reciprocal undertaking from Chen to Wu were solemn acts.  Chen knew that the form of the Written Undertaking was made by the form of a deed which was different from other documents that he signed.  Mr Pang SC submits that all these show that when Chen executed the Written Undertaking, Chen intended to execute the Written Undertaking in the form of a deed.  In my view, whether the Written Undertaking is a deed should be decided by reference to the document itself and the circumstances under which the document was executed.  There is no dispute that Chen had no legal knowledge and had not received any legal training.  Chen’s subjective belief is of limited relevance in determining whether the Written Undertaking is a deed or not a deed.  

83.  In my judgment, Chen is not able to give any reliable evidence on the central contentious factual issues in this case.  His evidence is of limited assistance in this trial.

D3.  Ds’ witnesses

84.  Juspine and Jason have given evidence in support of Ds’ case.  They have also called the following witnesses to give evidence in the trial:

(1)  Wong Man Chung (“Wong”), who has known Wu and Juspine for more than 30 years.

(2)  Chan, who was Wu’s accounting clerk since 1994 until around 2023.

D3.1 Juspine

85.  Wu has given evidence in support of Ds’ case.  Having considered Juspine’s evidence as a whole, I regard Juspine as an honest and reliable witness.  She has given clear and cogent evidence on the factual issues in this case.  Her evidence is in line with the indisputable documentary evidence.  She did not shy away from difficult questions and gave straightforward answers.  In my view, her evidence remains intact after cross-examination.

86.  Mr Dawes SC has made several criticisms against Juspine’s evidence.  With respect, I am of the view that these criticisms cannot impeach Juspine’s evidence.

87.  First, Mr Dawes SC submits that on Juspine’s own evidence, as early as in February 2014, she saw the need to guard against Wu changing her mind subsequently and to avoid being dragged into litigation by Wu:

(1)  Juspine prepared the Letter of Agreement and asked Wu to sign it on 7 February 2014 so as to evidence her intention in writing, because Juspine was worried that herself would be dragged into litigation by Wu at a later time.  As Wu would be easily influenced by Chen, Juspine considered that it would be necessary to have a piece of paper signed by Wu to protect Juspine herself.

(2)  To avoid any issue of conflict, before asking Wu to sign the Letter of Agreement, on 6 February 2014, Juspine arranged Wu to obtain advice not from Wilson Yeung but from another solicitor, ie Ng Ka Lok (“Mr Ng”) of Messrs. Chiu, Szeto & Cheng.

(3)  The aforesaid cautious approach is very different from how she arranged the Four Assignments to be executed later in 2014:

(a)  Juspine chose to have the Four Assignments (which are important documents) executed at a KFC restaurant in Aberdeen rather than at an office (for example, in the office of Wilson Yeung & Co).  Juspine said that their family had a habit of signing documents in that KFC restaurant.  That explanation is unsatisfactory and defies belief for a transaction of this nature and magnitude.

(b)  The choice of asking Wilson Yeung to prepare the Four Assignments rather than instructing and engaging an independent solicitor is also contrary to Juspine’s earlier evidence that it was important to avoid any potential conflict of interest.

(c)  Knowing that Wu could not read English, Juspine has failed to offer a persuasive reason to explain why the Four Assignments were drafted in English rather than in Chinese, or as to why no accompanying Chinese translations were provided to Wu at the KFC Meeting.

(4)  The contradiction is irreconcilable and reveals a deliberate strategy to bypass proper procedures and to mislead Wu.

88.  I do not regard the aforesaid as a valid criticism against Juspine.

(1)  There is no dispute that the KFC Meeting did take place in September 2014, and Wu did sign the Four Assignments in the KFC Meeting.[25]

(2)  Juspine explained that the KFC restaurant was a quiet place.  It was convenient to have discussion in that restaurant.  There is no evidence contradicting what Juspine had said.

(3)  After seeking independent advice from Mr Ng in February 2014, Wu had decided to transfer Chen’s interests in the Four Properties to Jason.  Wu’s decision is clearly shown in the Letter of Agreement signed by her on 7 February 2014.  The purpose of the Four Assignments is to implement Wu’s decision.  In these circumstances, it cannot be said that Juspine asking Wilson Yeung to prepare the Four Assignments would involve any conflict or potential conflict of interests.

(4)  As explained in §§68 to 76 above, based upon the evidence accepted by this Court, Wu clearly knew that she was transferring Chen’s interests in the Four Properties to Jason when she executed the Four Assignments on 29 September 2014.

(5)  It would not be a surprise that the Four Assignments were drafted in English.  In Hong Kong, a document conveying title of a landed property from a person to another person would always be drafted in English.  Although written Chinese translations of the Four Assignments were not available in the KFC Meeting, Sweetie Chan of Wilson Yeung & Co had translated the contents of the Four Assignments to Wu in the KFC Meeting.

(6)  Wu’s execution of the Four Assignments was witnessed by Sweetie Chan and a trainee solicitor. 

(7)  I do not agree that any proper procedure had been bypassed.  I also do not see any reliable evidence showing that Wu had been misled in any way.

89.  Second, Mr Dawes SC submits that adverse inferences against Ds should be drawn in respect of their assertion that Sweetie Chan and a trainee solicitor fully explained the contents and effect of the Four Assignments to Wu in Cantonese at the KFC meeting, as neither Sweetie Chan nor the unidentified trainee solicitor were called to give evidence to support Ds’ case.  Mr Dawes SC submits that:

(1)  Ps have at the very least demonstrated a prima facie case that the Four Assignments were not explained to Wu in the KFC Meeting.

(2)  In her evidence, Juspine that she did not even know the name of the trainee solicitor present at the KFC meeting.  As for Sweetie Chan, Juspine said that Sweetie Chan could not be found because Wilson Yeung & Co had already ceased operation.  This explanation is wholly unsatisfactory and implausible.  Had Ds been serious in locating these witnesses, steps could have been done to search for the identity of the trainee solicitor (which must be a matter of record kept by the Law Society). Yet, surprisingly, nothing was done despite Ps’ clearest challenge as to the relevant events at the KFC Meeting.

90.  I refuse to draw the adverse inferences suggested by Mr Dawes SC.  As said by Ma CJ at §§46 and 47 of in Hua Tyan Development, the party inviting the Court to draw an adverse inference against the other party must first establish a prima facie case by evidence of sufficient cogency.  As said in the above, I regard Wu as an unreliable witness and refuse to accept her evidence.  I also do not agree that the Audio Recording could form a satisfactory basis to support Ps’ theory that the Four Assignments had not been interpreted or explained to Wu in the KFC Meeting.  While there is no prima facie case established by cogent evidence against Ds, no adverse inference can be drawn.

91.  Further, without prejudice to the aforesaid:

(1)  As to why Juspine did not try to locate Sweetie Chan and ask her to give evidence in this case, Juspine said that Sweetie Chan could not be found because Wilson Yeung & Co had already ceased operation.  Juspine was further asked why she did not approach the Law Society and make an enquiry.  Juspine said that her lawyers did not tell her to do so.  In my view, these are credible and honest answers.  I am of the view that Juspine is not hiding anything.  I would not draw any adverse inference against Juspine because of the absence of Sweetie Chan in the trial.

(2)  As to why Juspine did not try to locate the trainee solicitor and invite her to give evidence in the trial, this question was not put to Juspine during cross-examination.  Since no opportunity was given to Juspine to give an explanation on this matter, I would not draw any adverse inference against Juspine based upon this matter.

92.  Third, Mr Dawes SC submits that in respect of HCA 2153/2014, Juspine was unable to provide any explanation as to why the statement of truth verifying the statement of claim in that action was signed by Wilson Yeung but not by Wu.  Juspine admitted that she could not recall why it was so.  Mr Dawes SC submits that the obvious inference is that no prior authorisation was obtained from Wu before the commencement of those proceedings.

93.  With respect, I am unable to agree.  As explained in §72(2) to (3) above, there is indisputable documentary evidence showing that HCA 2153/2014 was commenced pursuant to Wu’s instruction.  The fact that Juspine could not recall why the statement of truth in that action was signed by Wilson Yeung could not lead to the conclusion as suggested by Mr Dawes SC.  Juspine’s admission that she could not recall why the statement of truth was signed by Wilson Yeung shows that Juspine is a straightforward witness.  She would not shy away from difficult questions.  She has nothing to hide.

94.  Fourth, Mr Dawes SC submits that when Juspine was asked to confirm whether it was her understanding that the Four Assignments had the legal effect of transferring Chen’s interest to Jason, Juspine said that the Four Assignments would need to be registered, and there would be no effect until after registration.  Hence, in accordance with Juspine’s evidence, the contracts as per the Four Assignments had not yet been completed at the time when the Four Assignments were signed by Wu.

95.  In my view, whether the Four Assignments are executed contracts or executory contracts is a point of law.  The answer to the question does not depend upon Juspine’s subjective understanding.  In any event, the point set out in the paragraph above is not a point concerning the reliability of Juspine’s evidence.

96.  Fifth, Mr Dawes SC submits that in relation to Jason’s failure to pay the consideration under the Four Assignments, it was Ds’ pleaded case that Wu orally permitted Jason to pay the consideration when Jason had the financial means to do so.  However, under cross-examination, Juspine contradicted that case by suddenly saying that in fact, there was a mutual understanding that Wu would not expect Jason to pay.  That answer also directly contradicts §46 of Juspine’s own witness statement, in which Juspine stated “Mother and Jason agreed that Chen’s interest in the Properties would be assigned to Jason for consideration instead of as an outright gift”.  Juspine was changing her evidence and contradicting herself left and right.

97.  Having considered Juspine’s evidence carefully, I am of the view that there is no contradiction in her evidence.  In her witness statement, Juspine mentioned what was orally agreed between Wu and Jason concerning payment in the KFC Meeting.  In her evidence under cross-examination, Juspine mentioned her subjective understanding of the agreement concerning payment made in the meeting.  In fact, in her oral evidence, Juspine said that as to Wu’s permission for Jason to pay the consideration when he had the financial means to do so, Juspine regarded that statement as a half joke and a half serious statement.  What had been said in the meeting regarding payment is one matter, what was the subjective understanding in Juspine’s mind regarding the agreement concerning payment made in the meeting is another matter.

98.  Having considered all the evidence before this Court and the criticisms made by Mr Dawes SC against Juspine carefully, I conclude that Juspine is a reliable witness.  I accept and attach weight to her evidence.

D3.2 Jason

99.  Jason has given brief but cogent evidence at the trial.  In my view, Jason is a straightforward witness, and his evidence is reliable.

100.  Mr Dawes SC submits that Jason’s evidence is surprisingly simple and brief, and what he does not say that is telling and alarming.  According to Juspine, Jason was present at the KFC Meeting.  However, Jason has chosen to mention nothing about that meeting in his entire evidence.  Knowing the central importance of that meeting in this dispute, his silence is utterly baffling and inexplicable. One would have expected that had Jason genuinely witnessed the contents of the Four Assignments having been explained to Wu, one would have expected him to at least mention this in his witness statement.  Yet, it was not done.  There is no explanation from Ds as to why it was not done.

101.  With respect, the point made by Mr Dawes SC is based upon incorrect factual premises.  In §4 of Jason’s witness statement, Jason said that he had read Juspine’s witness statement and confirmed the contents thereof.  In §39 of Juspine’s witness statement, Juspine mentioned (a) on 29 September 2014, Wilson Yeung arranged Sweetie Chan and a trainee solicitor to meet Wu after lunch to sign the Four Assignments; (b) in the meeting, Sweetie Chan translated the contents of the Four Assignments to Wu before Wu signed the same; (c) after Sweetie Chan’s translation, Wu and Jason signed on the Four Assignments; (d) Jason was present in the meeting and witnessed Sweetie Chan’s translation to Wu.  In §46 of Juspine’s witness statement, Juspine mentioned that although Wu intended to transfer Chen’s interests in the Four Properties to Jason as gifts, Jason did not wish to be at the receiving end of such valuable gifts from Wu.  After some discussions among Wu, Jason and Juspine, and also at Jason’s insistence, Wu and Jason agreed that the interests would be passed to Jason with consideration in return from Jason, rather than in the form of outright gifts.  Jason would pay the consideration when he had the financial means to do so.  All these events involving Jason mentioned by Juspine were confirmed by Jason in Jason’s evidence.  It is incorrect to say that Jason mentioned nothing about the KFC Meeting in his evidence.  In fact, Jason also explained the transfer of the interests in the Four Assignments were with consideration in his evidence.  

102.  Mr Dawes SC submits that there is no reason for Wu and Jason to agree to defer the payment of the consideration as stated in the Four Assignments, for Wu had given HK$5 million to Jason in April 2007.  The basis of this submission is that in §15(e) of Juspine’s supplemental witness statement, Juspine mentioned that in April 2007, Wu paid HK$5 million to Juspine as Jason’s education fees.

103.  With respect, I am of the view that there is no sufficient factual basis in support of the criticism made by Mr Dawes SC.

(1)  Under cross-examination, Jason said that at the time of the Four Assignments, he did not know that Wu had given HK$5 million to him.  Juspine told Jason this matter at a later time.  As to exactly when Juspine told this to Jason, Jason could not recall.

(2)  Jason’s evidence that he did not know that Wu had given him HK$5 million at the time of the Four Assignments is not contradicted by any reliable evidence.

(3)  Further, according to Juspine, the HK$5 million given by Wu to Jason in April 2007 were education fees.  Juspine’s evidence on this point is not challenged.  Thus, that sum could not be used by Jason for any purpose other than for pursuing further studies.

104.  I accept Jason’s evidence.

D3.3  Wong

105.  Wong’s evidence concerns the Letter of Authorisation.  Wong said that in March 2014, there was a tea gathering at a restaurant.  Wu, Juspine, Jason and Wong himself were in that tea gathering.  In that meeting, Juspine explained the contents of the Letter of Authorisation to Wu.  Juspine told Wu that the document would be used to handle matters in the legal action against the administratrix of Tse Chun Ming, and other personal and legal matters of Wu.  Wong witnessed Wu putting her signature on the Letter of Authorisation.

106.  Wong’s evidence in fact is not challenged under cross-examination.  I accept his evidence.

D3.4  Chan

107.  Chan impressed me as a straightforward witness.  She directly answered questions put to her during cross-examination and would not shy away from difficult questions.  In my view, Chan is an honest witness.  Her evidence concerning the issuance of the Cheque is reliable.

108.  Regarding the issuance of the Cheque, Chan said that on 27 October 2014, Wu and Juspine had a meeting in the Repulse Bay Property.  In that meeting, she was instructed by Wu to issue a cheque in the sum of HK$1.2 million to Wilson Yeung & Co for payment of stamp duty and litigation costs in HCA 1414/2024, and the costs for an intended action against Chen for breach of the Written Undertaking and for recovery of Chen’s interest in the Four Properties.  Since the amount of the Cheque was substantial, Chan was particularly careful in confirming with Wu as to the amount and the purposes of the Cheque.

109.  Mr Dawes SC submits that Chan should not be regarded as a reliable witness.  Mr Dawes SC submits that:

(1)  Under cross-examination, Chan said that she also heard Wu requested Juspine to help to revoke Chen’s interests in the Four Properties and transferred the same to Jason on the day when the Cheque was issued.  Chan confirmed that she heard this once, and she never heard of it before.

(2)  Chan’s oral evidence contradicts her own witness statement, in which she stated that she heard Wu requested Juspine to help to revoke Chen’s interests in the Four Properties “from time to time” since early 2014.

(3)  When the inconsistency was pointed out to Chan, Chan said that she previously heard Wu mentioned revocation of Chen’s interests and agreed that she heard this more than once.

(4)  Chan’s abrupt reversal on a central issue is a textbook example of a witness tailoring her evidence to suit the party calling her.  This seriously undermines her reliability.

110.  In my view, the following would need to be borne in mind:

(1)  The trial took place in June 2026.

(2)  Chan made her witness statements in June 2023.

(3)  The trial took place 3 years after Chan signing her witness statement.  At the trial, when Chan was giving evidence concerning the events occurred in 2014, she was trying to recall matters happened around 12 years ago.

(4)  Chan was an accounting clerk, serving Wu for nearly 3 decades.

(5)  It is inherently probable that due to her job and her role, and the substantial amount of the Cheque, she could have a vivid memory of the circumstances concerning the issuance of the Cheque even after 12 years.

(6)  As to other matters which were unrelated to her accounting work, she may not have a clear memory after a long lapse of time.

111.  I am of the view that Chan’s evidence on the issuance of the Cheque is clear and cogent.  As to whether Wu mentioned revocation of Chen’s interests in the Four Properties once or more than once before 27 October 2014, Chan may not have a clear memory.  However, this would not render Chan’s evidence on the issuance of the Cheque being unreliable.

E.  FACTUAL FINDINGS

112.  Based upon the indisputable evidence and the evidence accepted by this Court, I make the following factual findings:

(1)  On 21 March 2009, when Wu gave some of her interests in the Four Properties to Juspine and Chen, Wu intended to retain some control in the Four Properties, and a right to get back those interests from Juspine and/or Chen in the event that they did not keep their promises as stated in the Written Undertaking.  After seeking independent legal advice from her own solicitor Mr Ng, Wu required Juspine and Chen to sign the Written Undertaking at the time when she signed the 4 deeds of gift to pass some interests in the Four Properties to Juspine and Chen.

(2)  Since Chen was addicted in gambling and was continuously incurring debts, in January 2014, Wu intended to take back the interests in the Four Properties from Chen.

(3)  The Letter of Agreement dated 7 February 2014 was duly signed by Wu.  When Wu put her signature on the document, the contents were already there.  Wu could understand written Chinese.  I find that Wu signed the Letter of Agreement with knowledge and understanding.

(4)  Starting from February 2014, Wu intended to take back the interests in the Four Properties from Chen and passed the same to Jason.  This remained to be Wu’s intention until early November 2014.

(5)  On 29 September 2014, at the time of the KFC Meeting, Wu intended to take back the interests in the Four Properties from Chen and transferred the same to Jason. In that meeting, the contents of the Four Assignment were interpreted to Wu by Sweetie Chan.  Wu signed the Four Assignments, with knowledge of the nature and effect of the Four Assignments.  No misrepresentation was made to Wu by Juspine as alleged by Ps in that meeting.  In that meeting, Wu and Jason agreed that Jason would only need to pay the consideration as stated in the Four Assignments when Jason had the means to pay (“the Payment Agreement”).

(6)  Wu only changed her mind in early November 2014.

(7)  Concerning the Cheque, Juspine’s case is the truth.  On 27 October 2014, when Wu signed the Cheque, Wu knew the amount and the purpose of the Cheque, and she signed the Cheque in accordance with her free will.

(8)  The Letter of Authorisation made on 5 March 2014 was duly signed by Wu.  When Wu put her signature on the document, the contents were already there.  Wu could understand written Chinese.  I find that Wu signed the Letter of Authorisation with knowledge and understanding.

F.  DISCUSSION

113.  I now proceed to discuss the issues set out in §52 above and to provide answers on those issues.

F1.  Issue (1) – Letter of Agreement

114.  Based upon the factual findings made by this Court, the answer to issue (1) is “Yes”.  In my judgment, Wu signed the Letter of Agreement dated 7 February 2014 with knowledge and understanding.

F2.  Issue (2) – Letter of Authorisation

115.  Based upon the factual findings made by this Court, the answer to issue (2) is “Yes”.  In my judgment, Wu signed the Letter of Authorisation made on 5 March 2014 with knowledge and understanding.

F3.  Issue (3) – Non est factum

116.  Based upon the factual findings made by this Court, on 29 September 2014, in the KFC Meeting, Wu executed the Four Assignments with knowledge and understanding.

117.  In Keswani Soshila v Keswani Motiram[26], Chu JA (as she then was) said:

“34.  For the defence of non est factum to apply, it has to be established that (i) the defendant was under a disability, whether permanent or temporary; (ii) the document he signed was fundamentally different from what he thought he was signing; and (iii) he was not careless in appending his signature to the document: Saunders v Anglia Building Society [1971] AC 1004. The defendant bears a heavy burden of proof and he must establish each of the three components.” (Emphasis added)

118.  As a result of the rejection of Wu’s evidence, there is simply no evidence in support of Wu’s claim based upon non est factum.  There is no reason to set aside the Four Assignments or to declare the Four Assignments void on the basis of non est factum.

F4.  Issue (4) – Misrepresentation

119.  On the misrepresentation claim, there is a debate on the sufficiency of pleadings between Mr Dawes SC and Mr Pang SC.  With no disrespect to counsel, I am of the view that in the circumstances of this case, whether Wu’s misrepresentation claim has been sufficiently pleaded in the Amended Statement of Claim is an academic discussion.  Based upon the factual findings made by this Court, even assuming that Wu’s misrepresentation claim has been sufficiently pleaded, that claim is not supported by the evidence accepted by this Court and must be rejected.

F5.  Issue (5) – Wu’s authority

F5.1 - Whether the condition precedent in the Written Undertaking had been satisfied before Wu executed the Four Assignments?

120.  Mr Pang SC submits that:

(1)  It is indisputable that Chen breached the terms of the Written Undertaking in the following manners:

(a)  In respect of the Aberdeen 153 Property, Chen severed the joint tenancy and mortgaged his 1/6 interest to Credit One Finance Limited by way of a legal charge/mortgage on 16 June 2014, and further mortgaged it to Mok Keng Chong by way of a second legal charge on 12 July 2014;

(b)  In respect of the Discovery Bay Property, Chen mortgaged his interest to Credit One Finance Limited by way of a second mortgage on 10 June 2014, which was not discharged until 1 December 2016; and

(c)  In respect of the Repulse Bay Property, Chen allowed two charging orders nisi to be registered against his interest between September 2013 and October 2014.

(2)  A mortgage is a form of security conferring an interest in real property, whereas a charging order confers a right on the creditor to seek an order for sale of the property to enforce the charging order.[27]

(3)  All of the above conducts have changed or caused changes to the original status of joint ownership of the Four Properties among Wu, Chen and Juspine.

(4)  Wu did not give her prior consent and/or permission to Chen’s breaches:

(a)  The recitals of the Four Assignments executed by Wu which stated that Chen was in breach of the Written Undertaking and Wu decided and determined to exercise her rights and powers under the Written Undertaking.

(b)  In §69 of Wu’s witness statement, Wu said that it was only in September or October 2014 that Wu knew about the notice of severance dated 16 June 2014 and mortgage in relation to the Aberdeen 153 Property.  Chen said in §11 of his witness statement that he only informed Wu of his act of severance and mortgage of the Aberdeen 153 Property after the severance and mortgage.

(5)  The condition precedent in the Written Undertaking had been fulfilled before Wu executed the Four Assignments.

121.  Mr Dawes SC submits that:

(1)  Any non-compliance with the Written Undertaking, if approved by Wu, would not constitute a breach of the Written Undertaking.

(2)  In §69 of her witness statement, Wu said:

“大約於2014年9 、10月，在與陳堅強溝通後，我才知道陳堅強於2014年6月16日透過一份通知書，將他於香港仔153號物業的1/6業權分割開來，並抵押了給財務公司 (並不涉及其他三個物業)。但並非如葉玉枝所說，打算『走佬』。因此我亦不打算向陳堅強追究香港仔153號物業分契的事。”

(3)  Wu’s evidence is that she did not intend to enforce any alleged breaches against Chen or to trigger the power of attorney under Clause 4 of the Written Undertaking.  Since this is a matter personal to Wu, no contrary evidence has been led by Ds to challenge such evidence.

(4)  This is further supported by Wilson Yeung and Juspine’s procurement of the commencement of the proceedings in HCA 2153/2014 in which Wu allegedly asked for a declaration that Chen ceased to have any interest in the Four Properties. Apparently, when these proceedings were commenced, the relevant parties (including Juspine) still took the view that whether there was any breach of any clause of the Written Undertaking was still a matter to be decided and adjudicated upon by the Court.  Given that at the time of the purported Four Assignments in September 2014, there had been no finding or prior determination that Chen had breached the Written Undertaking.

(5)  The condition precedent was never fulfilled. The power of attorney therefore never arose.

122.  I am of the following view:

(1)  Ps cannot derive assistance from §69 of Wu’s witness statement.

(a)  It is my finding that Wu is not a reliable witness.  What has been stated in §69 of Wu’s witness statement cannot be regarded as true.

(b)  Without prejudice to the above and even assuming §69 of Wu’s witness statement is true, the time when the communication between Wu and Chen took place was vague in that paragraph.  The Four Assignments were executed by Wu on 29 September 2014.  If the communication between Wu and Chen as stated in §69 of Wu’s witness statement took place at a time after 29 September 2014, Wu had not condoned what Chen had done to Aberdeen 153 Property when Wu executed the Four Assignments.

(c)  Further, as submitted by Mr Pang SC, what Chen had done to the Discovery Bay Property and the Repulse Bay Property also constitute breaches of the Written Undertaking.  §69 of Wu’s witness statement is not an answer to these breaches.

(2)  For the reasons submitted by Mr Pang SC as set out in §120 above, I agree that it is plain and obvious that before Wu executing the Four Assignments on 29 September 2014, Chen had breached the Written Undertaking.

(3)  Notwithstanding Mr Dawes SC’s eloquent submissions, I am of the view that the condition precedent in the Written Undertaking had been satisfied before Wu executed the Four Assignments on 29 September 2014.

F5.2 - Whether the Written Undertaking authorised Wu to transfer Chen’s interests in the Four Properties to anyone other than Wu herself?

123.  Mr Dawes SC submits that pursuant to the power conferred on her by the Written Undertaking, Wu could only transfer Chen’s interests in the Four Properties to Wu herself, and not to anyone else.  By reason of this restriction, the Four Assignments are void and of no effect.

124.  With respect, I am of the view that the answer to this question is plain and obvious.

(1)  Each of the Four assignments contain the following recital:

“(6)  Pursuant to [the Written Undertaking], the Confirmor has decided and determined to exercise her power and rights thereunder and acted as lawful attorney of Assignor to transfer all the Assignor’s in estate right title benefit and interest of and in the property more particularly described in the Second Schedule hereto (“the Property”) back to the Confirmor, but no Assignment thereof has yet been executed.” (Emphasis added)

(2)  In each of the Four Assignments, Wu had done two things, namely (a) assigning Chen’s interest in the subject property back to herself pursuant to the Written Undertaking; (b) thereafter, assigning the interest to Jason.  I do not see any problem in these arrangements.  There is no material difference between this scenario and the scenario in which Wu executing one assignment to transfer Chen’s interest back to herself first, and then immediately executing another assignment to transfer that interest to Jason.

(3)  In each of the Four Assignments, Wu in the capacity of Chen’s attorney (pursuant to the Written Undertaking) executed the assignment as assignor, transferring the interest in the subject property back to herself.  Wu also on behalf of herself executed the assignment as confirmor, transferring the interest in the subject property to Jason.  In my judgment, this arrangement did not travel beyond the scope of the authority conferred on Wu by the Written Undertaking.

F5.3 - Whether the Written Undertaking was executed as a deed?

125.  Mr Dawes SC submits that the Written Undertaking is not a deed.  It was signed as a simple agreement, not executed as a deed.  Hence, it therefore cannot validly confer a power to transfer legal title in land.  Mr Dawes SC submits that:

(1)  As prescribed by s.4 of the Conveyancing and Property Ordinance (“CPO”), a legal estate in land may be created, extinguished or disposed of only by deed.

(2)  Where an agent is authorised to execute a deed on behalf of his principal, that authority must itself be granted by deed.[28]  The Written Undertaking itself must qualify as a deed in order to validly authorise Wu to dispose of Chen’s legal estate in land. A simple contractual document is insufficient for this purpose.

(3)  A deed must be signed, sealed and delivered.  Delivery does not require physically handing over the document but a separate indication that the person intends to be bound by the deed other than by signing on it.[29]

(4)  The Written Undertaking was not executed as a deed.  Under s.19 of the CPO, the Chinese translation of the word “deed” is “契據” rather than “契約”.  As the Written Undertaking is titled “承諾契約”, the adoption of the word “契約” suggests that parties only intended it to be contractual in nature, short of the effect of a deed.

126.  I am unable to accept these submissions.

(1)  It is indisputable that Chen has signed the Written Undertaking.  It is also indisputable that a red wafer was affixed next to his signature on the document.  In his evidence, Chen admitted that he consented to the affixing of the red wafer next to his signature on the Written Undertaking.

(2)  S.19(2) of the CPO provides:

“(2)  A document shall be presumed to have been sealed by an individual if the document signed by him —

……

(c)  bears any mark, impression or addition intended to be or to represent a seal or the position of a seal.”

In my view, there is no evidence rebutting this statutory presumption.  Accordingly, the Written Undertaking is a document sealed by Chen.

(3)  In Wu’s witness statement, Wu said that she had sought advice from her own solicitor Mr Pang before gifting interests in the Four Properties to Juspine and Chen on 21 March 2009.  Following Mr Pang’s advice, Wu required Juspine and Chen to sign the Written Undertaking for the purpose of protecting Wu’s interests.  Importantly, at §65(3) of her witness statement, Wu said that there was only one original of the Written Undertaking, and the original was kept by Mr Pang.  After knowing the transfer by the Four Assignments, Wu took back the original from Mr Pang.  In other words, Wu admitted that after Juspine and Chen signed the Written Undertaking, the Written Undertaking was at all times kept by her solicitor, and later kept by herself.  Undoubtedly, after signing the Written Undertaking, Chen did deliver the same to Wu.

(4)  In my judgment, the Written Undertaking is a document signed by Chen, sealed by Chen, and delivered by Chen to Wu.  In the circumstances, the Written Undertaking is a deed binding upon Chen.

(5)  If the parties’ subjective intention carries any weight in assessing whether the Written Undertaking is a deed, there is clear evidence showing that both Wu and Chen intended that the Written Undertaking should have the effect of protecting Wu’s interests.  As said in the above, Wu’s intention was to require Juspine and Chen to sign the Written Undertaking to protect Wu’s interests.  At §10 of Chen’s witness statement, Chen also said that Juspine and him signed the Written Undertaking for the purpose of protecting Wu’s interests.  No doubt, both Wu and Chen intended that by Chen signing the Written Undertaking, the power stated therein would be conferred by Chen on Wu, so that Wu’s interests would be protected.

(6)  I have difficulties in accepting Mr Dawes SC’s submission that since the Written Document is described as “契約” in the document itself, the Written Document is not a deed.  With respect, counsel has not referred me to any decided cases, authoritative academic writings and/or dictionaries saying that “契約” cannot mean a document signed, sealed and delivered, by which interest in land is passed from one to another.  In any event, what is important is the substance of the document.  By reasons set out in the subparagraphs above, I am of the view that the Written Document is indeed a deed.

F6.  Issue (6) – If the Written Undertaking is not a deed, what is the consequence?

127.  As a result of the ruling set out in §§125 and 126 above, issue 6 does not arise.

F7.  Issues (7) to (10) – Consideration under the Four Assignments

128.  These issues can be dealt with together.

129.  I am most grateful to Mr Pang SC for referring me to the Court of Appeal’s decision in Ho Wai Kwong v Ho Kam Chui[30], in which G Lam JA said:

“50.  On the basis the transaction was a sale and purchase, what was the legal position of the parties in light of the defendant’s failure to pay the price?  The judge’s reasoning, following the plaintiff’s submissions, consisted of these steps: (1) The defendant’s failure to pay the price within a reasonable time after the Mother started to chase for it in July or August 2014 was a repudiatory breach of the SPA.  (2) As the vendor, the Mother was entitled to accept the wrongful repudiation, thereby terminating the contract, so long as she had not affirmed the contract.  (3) On the facts, the Mother had not affirmed the SPA, and at the family meeting on 28 April 2015, or at the latest by the issuance of the writ on 10 May 2016, the defendant’s repudiation was accepted by the Mother or the plaintiff, bringing the SPA to an end.  (4) Upon termination of the SPA, “there was no longer any legal basis whatsoever for the Defendant to continue to hold any beneficial interest in the Property.”  (5) “Under the law of restitution, from that moment, the Defendant must have been holding the 50% interest in the Property registered in her name as joint tenant on trust for the Mother.”  Each of these steps calls for close examination. 

……

52.  Regarding the first two steps of the judge’s reasoning, under the SPA the price was to be paid in one lump sum upon completion, and completion was fixed for 7 February 2013.  Assuming time was not of the essence in that respect, the question could arise, upon the purchaser’s failure to tender payment at the stipulated time or after the vendor gave the requisite notice, as to whether such failure was a repudiation of the SPA and whether the vendor could accept the repudiation and thereby bring the contract to an end. 

53.  But this question would only be meaningful if the contract had remained executory and there were outstanding obligations for the vendor to perform from which she wished to be discharged.  Termination of a contract by acceptance of a wrongful repudiation is a mechanism for the innocent party to be released from his obligation further to perform his own remaining obligations under the contract.  It is prospective in operation and does not unwind what has been executed under the contract: see e.g. Chitty on Contracts (35th ed), vol. 1, §§28-078 & 28-082.

……

55.  In the present case the Mother had already performed her part of the contract by assigning the Property to herself and the defendant as joint tenants.  She had acquired an immediately enforceable right to the price, and the defendant had correspondingly incurred the liability to pay it, which was actionable as a debt.  There was nothing that remained for the Mother to perform, and nothing in reality for her to terminate. Termination is sometimes also used by the innocent party to discharge himself from his obligation to accept performance by the other party if made or tendered.  But here what remained to be performed by the defendant was simply the payment of the purchase monies.  The defendant had already incurred the liability to pay it, which would remain despite termination.  It follows in our view that the use of the concepts of repudiation, acceptance and termination in the context of this case was inapt.  ……

56.  For the same reason, the third step in the judge’s reasoning, concerning whether and when the defendant’s repudiation was in fact accepted by the Mother, has no significance. 

57.  The fourth step is in our view erroneous in law.  It appears to have stemmed from a mistaken assumption that upon termination of a contract, it can no longer provide the basis for property rights acquired before.  As stated above, termination of a contract operates prospectively.  It does not operate as a rescission ab initio, and does not negative the historical subsistence of the contract.  Nor does it automatically operate to denude transfers of property made under the contract during its currency of all legal basis.

……

60.  In the present case, the Property was conveyed to the Mother and the defendant as joint tenants pursuant to the SPA during its currency, resulting in an accrued liability for the defendant to pay $8 million.  Termination of the contract thereafter (assuming it was possible) did not retrospectively remove the basis for the transfer.

61.  As a vendor of an interest in land, the Mother had by operation of law an equitable lien over the interest sold, even after it was conveyed to the defendant, to secure any part of the purchase money which remained unpaid, even though the Assignment contained a receipt for the purchase money: Barclays Bank plc v Estates & Commercial Ltd [1997] 1 WLR 415, 419H-420B.  This lien however only functioned as a charge on the interest in land as security for the price entitling the Mother upon default in payment to a court order for sale; it did not operate to re-vest the beneficial interest in her.

62.  The fifth step in the judge’s reasoning is in our view also erroneous.  The Mother having conveyed the property had an accrued right to the price enforceable by an action in debt.  In these circumstances, the parties’ legal relationship, and their respective rights and liabilities, are governed by contract, and there is no need or scope for bringing in the law of restitution.  The judge erred in accepting the plaintiff’s submission that applying the law of restitution to these facts results in the defendant becoming a trustee of the 50% interest in the Property registered in her name.

……” (Emphasis added)

130.  Mr Pang SC submits that in view of what the Court of Appeal has said in Ho Wai Kwong, even assuming that Jason’s failure to pay the consideration as stated in the Four Assignments constitutes a breach of the contract in each assignment, the Four Assignments would not therefore be unwound.  I am in respectful agreement with Mr Pang SC.  After Wu executing the Four Assignments, the Four Assignments would be executed contracts, not executory contracts.  After executing the Four Assignments, Wu had already performed her part of the contracts.  There was nothing left to be performed by Wu, and nothing left for her to terminate.  As a matter of law, the Four Assignments would not be unwound by reason of non-payment of the price by Jason.  In this context, whether the non-payment of the price by Jason constitutes a repudiation, and whether the repudiation has been accepted by Wu, are really neither here nor there. 

131.  Ps contend that in each of the Four Assignments, there was an implied term that Jason had to pay the consideration within a reasonable time (ie on or before 1 June 2015).  However, as said in §112(5) above, based upon the evidence accepted by this Court, I find that in the KFC Meeting, Wu and Jason made the Payment Agreement.  With the finding of this express Payment Agreement, the implied term suggested by Ps must be rejected.

132.  In my view, the Payment Agreement is a legally binding agreement.  In fact, Jason treated the Payment Agreement as legally binding.  On 31 December 2020, Jason tendered HK$5 million as the payment of the consideration as stipulated in the Repulse Bay Assignment, the Aberdeen 152 Assignment, and the Discovery Bay Assignment.  However, on 9 January 2021, Wu refused to accept the HK$5 million.  Wu’s refusal to accept the payment is her own choice.  It cannot be said that by reason of Wu’s refusal to accept the payment, Jason had breached the Payment Agreement.

133.  Notwithstanding Wu’s execution of the Aberdeen 153 Assignment, Wu could not pass Chen’s interest in the Aberdeen 153 Property to Jason due to the mortgagee exercised the right of sale pursuant to the Aberdeen 153 First Mortgage on 10 June 2016.  As a matter of priority, the Aberdeen 153 First Mortgage ranked before the Aberdeen 153 Assignment.  Hence, it would be reasonable for Jason not tendering payment of the consideration stipulated in the Aberdeen 153 Mortgage to Wu.

F8.  Issue (11) – the Cheque

134.  Based upon the factual findings made by this Court, Wu’s claim on the Cheque must fail.

F9.  Issue (12) – Whether Wu liable to account to Jason?

135.  In the counterclaim raised by Jason, Jason seeks an order requiring Wu to account for the rental incomes from the Discovery Bay and the Aberdeen 152 Property, and the mesne profits of the Repulse Bay Property.

136.  Mr Dawes SC submits that Jason’s claim is misconceived.

(1)  Wu merely assigned Chen’s interests in the relevant properties (“the Three Properties”) to Jason.  Chen’s interests in these properties were not unrestricted proprietary interests, but were interests subject to the Written Undertaking.  By reason of the restrictions in the Written Undertaking, Chen had no right to ask Wu to vacate the Three Properties, and had no right to receive the rental incomes or any part thereof generated from the Three Properties.  Nemo dat quod non habet: no person can confer a better title than he himself has.  Jason therefore must take Chen’s interests in the Three Properties subject to the restrictions in the Written Undertaking affecting the interests.

(2)  Further or alternatively, in Cheung Lai Mui (張麗梅) v Cheung Wai Shing (張偉城)[31], the Court of Final Appeal held that there is no free-standing claims by one co-owner against another co-owner in occupation for the payment of occupation rent or for an account of rent. Such claims only arise in cases of ouster or where an operative agreement rendered the co-owner in occupation an agent or bailiff so as to come under a duty to account to the other.  Jason has not pleaded ouster or any operative agreement.  There is also no evidence on these matters.

137.  In response, Mr Pang SC submits that:

(1)As to the nemo dat point made by Mr Dawes SC:

(a)  The 4 deeds of gift granting Juspine and Chen interests in the Four Properties did not provide that the grant would be subject to any covenants in the Written Undertaking. Instead, the Deeds of Gift only provided that the grant would be subject to the covenants in the respective government leases and the respective deeds of mutual covenants “but not further or otherwise”.

(b)  The Written Undertaking was not registered in the land registry.

(c)  The covenants in the Written Undertaking were made by Juspine and Chen to Wu personally, until Wu surrendered the same voluntarily (“直至你自願放棄為止”).

(d)  The covenants in the Written Undertaking were expressed to be personal, being given only to a specific covenantee in respect of the obligations only of a specific covenantor. S. 41(2)(c) of the CPO is not satisfied. The covenants in the Written Undertaking are not enforceable against Jason.[32]

(e)  Further, Clause 2 of each of the Four Assignments provided that “It is hereby agreed and declared by the parties hereto that the respective covenants by the Assignor and the Assignee implied by the Conveyancing and Property Ordinance (Cap.219) and herein contained shall be construed and shall take effect so far as they affect or relate to the Property but not further or otherwise.” (Emphasis added)

(f)  Jason is not bound by the personal covenants in the Written Undertaking given by Chen to Wu, and Jason is entitled to an account of rental income and mesne profits by virtue of being an owner of the Three Properties.

(2)As to the ouster point made by Mr Dawes SC, Wu’ legal action against Jason in HCA 479/2015, and Wu’s legal action against Jason in HCA 1210/2015, constitute ouster. 

138.  Having considered the parties’ respective submissions, I am of the view that the nemo dat point has been satisfactorily answered by Mr Pang SC, but not the ouster point.  It is clear that the question of ouster has not been raised by Jason in his pleadings.  As a result, it would not be permissible for Mr Pang SC, in the final submissions stage, suddenly raised that some matters constitute ouster.  Accordingly, on issue (12), by reason of the ouster point made by Mr Dawes SC, this issue should be resolved in Wu’s favour.

F10. Conclusion on Ps’ case

139.  By reason of the aforesaid, Part I of Ps’ case must be dismissed in its entirety.  Likewise, Part II of Ps’ case must also be dismissed in its entirety.

F11. Conclusion on Jason’s counterclaim

140.  Jason seeks a declaration he is the legal and beneficial owner of 1/6 interests in the Three Properties.  As a result of the rulings set out in the above, I am minded to grant a declaration to make it clear that Jason is a co-owner of the Three Properties.  However, after transferring Chen’s interests in the Three Properties to Jason, whether Jason is holding those interests in the Three Properties together with Wu and Juspine as joint tenants, or whether Jason is a tenant in common having 1/6 interest in each of the Three Properties, these matters have not been ventilated in the trial.  Accordingly, I prefer to adopt a prudent approach.  In respect of each of the Three Properties, I am minded to grant a declaration that the assignment dated 29 September 2014 executed by Wu as assignor on behalf of Chen pursuant to the Written Undertaking, by Wu as confirmor, and by Jason as assignee, is valid and binding upon the parties thereto, with effect of conveying the subject property therein from the assignor to the assignee.

141.  Save the aforesaid and the question of costs, there is no reason to allow the other parts of Jason’s counterclaim.

F12. Costs

142.  Costs should follow the event.  In my view, most of the time in these proceedings was spent on issues on which Ps lost.  Taking a broad-brush approach, I am minded to order 90% of the costs of these proceedings (including costs reserved, if any) be paid by Ps to Ds, with a certificate for two counsel, to be taxed if not agreed.  I would so order on nisi basis. 

G.  DISPOSITION

143.  For the reasons above, I make the following order:

(1)  Ps’ claim be dismissed;

(2)  As to Jason’s counterclaim:

(a)  In respect of each of the Three Properties, there be a declaration as stated in §140 above;

(b)  save the aforesaid, Jason’s counterclaim be dismissed. 

144.  I make the costs order nisi as set out in §142 above.  Unless there is an application for an order varying the costs order nisi made by an inter partes summons within 14 days, the costs order nisi shall become absolute without a further order.

145.  Lastly, it remains for me to express my gratitude to all counsel for the very helpful assistance rendered to the Court.

Mr Victor Dawes SC leading Mr Vincent Chen, instructed by Gallant, for the 1^st and 2^nd plaintiffs

Mr Robert Pang SC leading Mr Brian Tsui, instructed by Yung, Yu, Yuen & Co, for the 1^stand 2^nd defendants