Longouan Ltd and Another v. Morgan Guaranty Trust Co of New York
Read the full judgment text of HCA 862/1995 on BabelCite. This High Court CFI judgment was delivered on 6 August 1997.
1. Morgan Guaranty Trust Company of New York (" the Bank ") is a big and well known international bank, based in New York. For some time, the Bank and its subsidiaries and associates have been carrying on very large operations in Hong Kong. The Bank employed in Hong Kong many senior expatriate staff, mainly from America and the Bank housed them in appropriate accommodation, ranging from very comfortable flats at Mid-Level to luxurious houses on the Peak. John Dexter Langlois, Jr. (" Langlois ")
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HCA000862/1995
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----------------- Coram: The Hon. Mr. Justice Waung in Court Dates of Hearing: 7 - 11, 14 - 18, 21 - 24, 29 - 30 July 1997 Date of Delivery of Judgment: 6 August 1997 ----------------- JUDGMENT ----------------- 1. Morgan Guaranty Trust Company of New York ("the Bank") is a big and well known international bank, based in New York. For some time, the Bank and its subsidiaries and associates have been carrying on very large operations in Hong Kong. The Bank employed in Hong Kong many senior expatriate staff, mainly from America and the Bank housed them in appropriate accommodation, ranging from very comfortable flats at Mid-Level to luxurious houses on the Peak. John Dexter Langlois, Jr. ("Langlois") was one of 10 Managing Directors in Hong Kong who worked for the Bank in 1994. Langlois first came to work for the Bank in Hong Kong in 1993 and he was housed by the Bank in Flat 501 Tavistock Apartment, Tregunter Path ("the Tavistock Flat") which was previously occupied by Mr. Beczak ("Beczak"), who was the Chairman of the Hong Kong Management Committee and the top man of the Bank in Hong Kong and therefore also the superior of Langlois. When Beczak moved up to the Penthouse on the 12th Floor of Tavistock Apartment ("the Tavistock Penthouse"), the Tavistock Flat became available and Mr. and Mrs. Langlois moved into that Tavistock Flat. 2. However not more than one year after Langlois moved into the Tavistock Flat, he found that he had to move again because some time in April 1994, the Bank was informed that the building Tavistock Apartment Block was going to be redeveloped by the owners of the Block, Kerry Properties Limited ("Kerry"). The positive side to the Bank of this proposed redevelopment is that the Bank would be receiving substantial sums by way of compensation and moving allowance but the negative side is that alternative premises would have to be found and that further the Bank would have to pay higher rental as the prevailing market at that time was high. 3. Langlois did not take too long to find his new home. He and his wife got in touch with Gloria Wong ("Gloria") of Classic Homes, the estate agent company. Gloria showed Mr. and Mrs. Langlois the apartment 4F at Grenville House, Magazine Gap Road ("the Flat") and they took to the Flat immediately. This was in late June 1994. Dr. Alison Helen Allan ("Allan"), a director of the landlord of the Flat was also there at the first visit of Mr. and Mrs. Langlois to the Flat and it was then more or less agreed that the Bank would take the Flat at $180,000 per month. The Flat was very tastefully decorated by Allan but the three bathrooms were not up to the same high standard and it was agreed during the first visit that the three bathrooms would have to be totally renovated which renovation work was to be undertaken by the landlord but with the Bank as tenant paying $170,000 as its contribution towards such renovation of the Bathrooms. A second meeting however was necessary because the decorator/contractor of the landlord, Mr. Jonathan Coleman ("Coleman") must attend to work out the details of the renovation work required to be done. This second visit took place a few days after the first visit and it was attended by Gloria, Mr. and Mrs. Langlois, Allan and Coleman. It was also a very successful meeting. By the end of the second visit, the parties were agreed on all the essential terms, namely 2 years lease at $180,000 per month with 2 months deposit to be paid and the lease to commence on 16th November 1994. The renovation of the 3 Bathrooms by the landlord was agreed to be completed by 15th November 1994 with the Bank agreeing to pay $170,000 for the renovation. What then followed was an offer letter dated the 1st July 1994 ("the Offer Letter") from Gloria to the Bank resulting eventually in the signing of the Lease dated 10th August 1994 ("the Lease"). 4. The Offer Letter was faxed by Gloria to Vincci Chin of the Human Resources Department of the Bank under cover of a Fax dated 4th July 1994. The Human Resources Department of the Bank was responsible for the accommodation of the staff of the Bank. Vincci ("Vincci") was a housing officer of that department. What followed after the initial Offer Letter was not entirely clear but there were certainly some negotiations over the detailed terms of the lease to be entered. Eventually the Lease was signed first by the Bank probably around the 14th July 1994 and by Allan for and on behalf of the landlord in late July or early August 1994. 5. The Lease provided in Clause 9 (b) that:-
The Lease also provided in Clause 9(a) that the Landlord will carry out the sprucing up works to the Flat prior to the 15th November 1994. It was envisaged originally that the Lease would be supplemented by a side letter dealing with details relating to the renovation work to be undertaken. The side letter assumed some significance in July 1994 because Allan found it necessary to ask that the renovation work be completed not by 15th November 1994 as originally agreed but by 30th November 1994, some 2 weeks later. After some negotiations between Gloria on behalf of the Bank and Allan, a supplementary agreement dated 26th July 1994 ("the Side Letter") was signed by the Bank and Allan. 6. After setting out the new completion date of 30th November 1994 for the renovation work, the Side Letter provided:-
This provision giving the right of the landlord to receive the $170,000 renovation money from the Bank against invoices and receipts, which I will call hereinafter the Invoice Clause will prove in time, to be the source of so much blood-letting in this most unusual and unfortunate case. 7. The evidence showed that the Side Letter was signed by the Bank probably around 27th July and by Allan either that day or probably a little bit later and it was after the Side Letter was signed by the parties that Allan signed the Lease. The Lease was probably signed by Allan either at the end of July or probably in the early days of August 1994. On the 10th of August 1994, Gloria dated the Lease and then caused it to be stamped on the 12th August 1994. The two months rental deposit of $360,000 provided in the Lease was paid to Allan also at the end of July, on or around the 30th July 1994. 8. Nothing much then seemed to take place between the Landlord and the Tenant in relation to the Flat during August 1994. By late September 1994, however something began to stir and there was apparently a fax dated 10th September 1994 ("Renovation Items September Fax") from Gloria to Allan which was faxed to Allan on 26th September (page 90 of Bundle). That Renovation Items September Fax sets out bathroom by bathroom the renovation work which was supposed to be carried out in each of the 3 bathrooms. For reasons which are never fully explained, a slightly different version of the Renovation Items September Fax (with completion date changed to 30th November 1994, with deletion of last line of Please feel free to call, with addition of copy to Langlois and with handwritten not agreed under laundry Area items signed by Allan) to be seen at Tab 1 of Defendant's Bundle and as part of Exhibit D15, was faxed again by Gloria to Allan on 16th October and by Gloria to Rita on 18th October 1994. It was probably this activity of detailing in late September 1994 the work to be done for the renovation of the bathrooms which caused Allan in late September 1994 to require payment of the renovation money of $170,000. The case of the Landlord is that Gloria on behalf of the Bank promised to Allan that the renovation fund of $170,000 would be paid by 1st of October 1994. But this was not paid on 1st of October 1994 and it is the case of the Plaintiffs that another promise was made by Gloria that payment would be made on the 12th October which promise was according to the Landlord also not kept. 9. While it was common ground that Allan from late September 1994 was asking for payment of the renovation money, there was disagreement on whether there were promises by the Defendant to pay and whether there were threats by Allan of the Landlord to cancel the Lease if renovation payment was not made. The Bank denied that Gloria made promises to pay on 1st and 12th October while Allan denied that she had threatened Gloria inlate September and before 17th October to cancel the Lease if renovation payment was not made. 10. On the 16th and 17th October 1994 things started to move because to overcome the Invoice Clause in the Side Letter, Gloria and Vincci were involved in devising a letter dated 17th October 1994 to be sent by Allan to the Bank seeking payment of renovation money. This letter dated 17th October 1994 ("Bocastle Letter") was addressed to Rita Fung ("Rita"), the secretary of Langlois and it said the following:-
Yours faithfully,
A copy of this Bocastle Letter could be seen at Tab 2 of the Defendant's Bundle. This Bocastle Letter was drafted by Gloria after discussion with Vincci and most probably also with Rita. The purpose of this Bocastle Letter was obvioulsy to secure payment of the $170,000 renovation money ("Renovation Money") for Allan without production of the invoices and receipts as required by the Invoice Clause of the Side Letter. Bocastle Limited is the name of the company owned by Allan which was supposed to do the renovation work. The attachment to that Bocastle Letter is the Renovation Items September Fax. This Bocastle Letter was faxed to Allan and Allan then apparently signed it but she also wrote in her own handwriting the following:-
For the sake of clarity. I will hereinafter refer to the Bocastle Letter with the manuscript addition by Allan as "the Bocastle Composite Letter", a copy of which can be found at page 91 of the Bundle or Tab 3 of the Defendant's Bundle. This Bocastle Composite Letter is a key document, as will be seen later in the development of the story. 11. The reference by Allan in the Bocastle Composite Letter to Bank doing the renovation work itself (namely the Bank using Bank's own contractor to do the renovation of the bathrooms) apparently stemmed from what Allan was told by Gloria that the Bank was considering using its own contractor to do the renovation work. The Bocastle Composite Letter was given by Allan to Gloria and was then on the 18th October 1994 faxed by Gloria to Rita under cover of a fax dated 18th October 1994 (page 101 of the Bundle) from Gloria to Rita (copied Vincci and Langlois) in which Gloria transcribed the hand written part of the Bocastle Composite Letter and ending the fax by asking Rita "to please feel free to call me to discuss about this". What discussion there then followed between Gloria and those of the Bank (whether with Vincci or Rita or Langlois or all three) is not as important as the fact that it was decided by those acting on behalf of the Bank that the request for payment contained in the Bocastle Composite Letter was not good enough. 12. In the morning of the 19th October 1994, Allan faxed to Vincci a document dated 18th October 1994 with the heading Estimate re F4 Grenville House ("Estimate") which can be found at page 97 of Bundle and Tab 5 of the Defendant's Bundle. The Estimate described total works amounting to $238,500. At the bottom of this document Estimate, Allan wrote in her own handwriting the following:-
But no payment was made at 11 a.m. on 19th October and Allan was informed on the phone that the document Estimate was not considered adequate, as it was not even an invoice since it was headed estimate. 13. So Allan sent another Fax dated 19th October to Vincci complaining the attitude of Vincci ("Complaint Fax") which can be found at page 99 of Bundle (Defendant's alleged copy at Tab 9 of Defendant's Bundle) together with an improved version of the Estimate, namely an invoice dated 18th October 1994 ("Invoice") but headed Invoice re F4 Grenville House but without the bottom manuscript part of the Estimate. A copy of this Invoice is to be seen at Tab 7 of Defendant's Bundle. The Complaint Fax to Vincci is in the following terms: -
The dispute at the Trial is whether this Complaint Fax was sent the morning of the 19th October, according to Allan or the morning of the 20th October, according to Vincci. The Complaint Fax asked for "deposit before 12.00 today". But whatever the date this fax was sent, there was no deposit either by noon on 19th or 20th October. 14. What apparently happened was that Vincci and Allan had another telephone conversation in which Vincci informed Allan that money required would not be paid as the faxed Invoice was so unprofessional, with no name of company or invoice number that Vincci did not even consider the document Invoice as a proper invoice. Allan's evidence is that subsequent to such a telephone conversation, she faxed to Vincci what can be seen at page 98 ("Bocastle Invoice"), an improved version of the Invoice with the words Bocastle Company and Invoice No. 001 added by her in own hand at the top and the name of Bocastle and its address at 29 Lugard Road added at the bottom of the Invoice. The evidence of Allan is that she faxed together with the Bocastle Invoice four receipts ("4 Receipts"), being Coleman Receipt for $100,000 (page 131), Vincent Sanitary Ware Receipt for $1,240 (page 137), Luen Hing Receipt for $22,570 (page 139) and Coleman Receipt for $8,500 (page 141). The case of the Defendant is that these 4 Receipts were never received by the Bank either on the 19th or 20th October 1994. But in any event, sending the Bocastle Invoice did not help as no payment was made. 15. As Allan had no success with Vincci, she moved up further the corporate ladder and wanted to speak to Langlois and on the 20th October 1994 in the afternoon, Allan asked to speak to Langlois. There was a dispute as to whether the 2 p.m. call was transferred from Vincci to Rita or was made directly to Rita. There is no dispute that shortly after 2 p.m. on the 20th October 1994, Allan spoke with Rita and asked to speak with Langlois who was allegedly engaged in a meeting with an American visitor from the Defence Department. Rita and Allan gave different versions of what happened with Rita saying that Allan threatened that she would terminate the Lease unless Langlois came to the phone while Allan denied that such was said. Rita said she did interrupt the meeting of Langlois but he would not come to the phone and merely said if she wanted to terminate then let her terminate. 16. There is no dispute that at about 3 p.m. Langlois did telephone Allan after he had finished the meeting. There was a short telephone conversation between Langlois and Allan, lasting no more than two or three minutes. At the end of the telephone conversation, apparently the Lease had been terminated. The question is who terminated the Lease. The evidence of Allan is that Langlois terminated the Lease whereas the evidence of Langlois is to the contrary, namely that it was Allan who terminated the Lease to which he said fine. This happened at about 3 p.m. on the 20th October 1994. 17. Immediately after this telephone conversation on the 20th October 1994 between Allan and Langlois ("Termination Call"). Allan tried to call Langlois but he refused to take the call. Allan then telephoned Vincci who said she was told by Langlois that Allan had terminated the Lease but Allan corrected her and told Vincci that it was Langlois who terminated the Lease. Immediately after she spoke with Vincci, at about 3.15 p.m. on 20th October 1994 or about 15 to 20 minutes after the Termination Call, Alan sent a very important fax to Langlois ("Termination Fax") which can be found at page 102-3, the text of which reads as follows: -
Langlois did not contact her or write her back by 6 p.m. that day (20th October) to confirm that he had terminated the Lease or to refute her allegation that he had terminated the Lease during the Termination Call. 18. David Smith of Slaughter and May, Solicitors for the Bank who had been involved with the surrender of the Tavistock Flat and seeking compensation for the Bank in relation to the surrender, came on the dispute scene officially on 21st October 1994. By his letter dated 21st October 1994 to Allan, David Smith on behalf of the Bank said that:-
19. Alan answered immediately the same day that Fax of Slaughter and May dated 21st October, followed up by Faxes from her on 25th, 26th and 27th October 1994. By Fax dated 27th October 1994, Slaughter and May on behalf of the Bank said that during the telephone conversation on 20th October Allan had said she would terminate the Lease, which repudiation Langlois immediately accepted. Slaughter and May ended that Fax by asking for the immediate return of the Deposit. Shortly afterwards proceedings started basically with the Landlord suing for damages for repudiation of the Lease while the Bank sought the recovery of the Deposit in the sum of $360,000. 20. There was a great deal of acrimony between the parties during all the interlocutory stages and unfortunately, it took something like two and half years before the trial came on. At the conclusion of the hearing before me which took some 16 days, three issues were formally required to be determined, namely:-
21. For me there is really no substance in the Agency Issue or in the Quantum Issue and I more or less told the parties at the trial, but Mr. Chan for the Bank persisted and I will therefore shortly state these two Issues only to dismiss them as being without substance. AGENCY ISSUE 22. The Agency Issue arose this way. The Lease was in the name of the 2nd Plaintiff, Alsun Development Ltd. and Allan signed that Lease as a director of the 2nd Plaintiff. In the Bank's search for a defence to the claim of the Landlord for repudiation of the Lease, the Bank in 1996 discovered that the Flat was legally registered in the name of the 1st Plaintiff, Longquan Limited. The issue was then raised by the Bank that the 2nd Plaintiff had no right to make the claim as it was not the legal owner of the Flat. The Statement of Claim was therefore amended in April 1996 by pleading that the letting was done by the 2nd Plaintiff as agent for the 1st Plaintiff. The Defendant disputed this allegation of agency and in November 1996 further added in its Defence and Counterclaim at paragraph 5A, an allegation of misrepresentation, namely that Allan had misrepresented to Gloria that 2nd Plaintiff was the owner of the Flat. The misrepresentation defence was abandoned fairly early on during the Trial as the central allegation of misrepresentation was not even to be found in the signed Witness Statement of Gloria Wong. What was left was therefore the Agency defence and in substance amounts to an assertion by the Bank that the letting done by the 2nd Plaintiff was not authorised by the 1st Plaintiff. The court heard evidence on this Agency Point from Allan, her mother Mrs. Allan and her father Dr. William Garland Leith Allan. The mother was and is a director and shareholder of the 1st Plaintiff, Longquan Limited and the father was and is a director and shareholder of the 2nd Plaintiff, Alsun Development Ltd. Allan was and is a director and shareholder of each of these two companies and it is obvious that these two companies are family companies which the father and mother had allowed the daughter Allan to run as she saw fit. Evidence was given about the meeting on the 1st June 1994 when particular authority was given whereby the 1st Plaintiff authorised the 2nd Plaintiff as property agent to let out the Flat. Signed Minutes of the two companies were produced to the Court and the evidence given by the father, mother and daughter confirmed the giving of authority to the 2nd Plaintiff. I accept the evidence of all three of them and I am particularly impressed by the evidence of the father, Dr. William Allan and of his daughter, Allan. The mother, Mrs. Allan was sometimes a bit confusing in her evidence due no doubt to her nervousness in having to give evidence, her age and her health and the fact that she was giving evidence in English, not her native language. But I also accept her evidence. I have no doubt that the authority alleged by the Plaintiffs had been given for the letting of the Flat to the Bank and accordingly I hold that no good defence has been established by the Bank on the Agency Issue. QUANTUM ISSUE 23. The Quantum Issue is really by way of an after-thought of those acting for the Bank. It did not feature in the Defence of the Bank. It was not referred to in the Opening of Mr. Chan for the Bank. There was no evidence on it and it first surfaced at the Trial as a point in the Defendant's Skeleton Submissions for the final argument. The point is that because the Lease provided in Clause 10(d) that the Tenant has the option to terminate the tenancy at any time after the first 12 months by serving a minimum of 3 months written notice, therefore the loss of rent of $35,000 claimed by the Plaintiffs on the basis of 19 months from 15th April 1995 (when it was first relet to new tenant) to 15th November 1996 (when the Lease ought to expire) should be reduced to a period of 10 months, namely up to 15th February 1996 (which is 15 months from the time of commencement of the Lease). This attempt at 9 months saving at $35,000 per month is therefore worth $315,00 to the Bank. Otherwise the Bank does not dispute the other quantum claimed in the Amended Statement of Claim although there was a faint attempt by Mr. Chan to argue that $170,000 Renovation Money would amount to unjust enrichment which attempt was quickly abandoned when he Court pointed out that this unjust enrichment point was totally devoid of merit. 24. What the Landlord did in this case was to mitigate its loss upon the repudiation of the Bank to take up the Lease. The Landlord lost in two ways because it took sometime to find a new tenant and to start a new tenancy and the new tenancy it could reasonably secure was at a rental level considerably lower, resulting in a monthly loss of rent of some $35,000. The loss to the Landlord was therefore firstly for the whole rental of $180,000 per month under the Lease for the 6 months up to 15th April 1995 (paragraph 9(a) of Amended Statement of Claim) and secondly for the rental difference of $35,000 from 15th April 1995 until the Lease would have ended, namely 15th November 1996, a period of 19 months (paragraph 9(f) of Amended Statement of Claim). This second loss from the rental difference at $35,000 per month for 19 months is therefore the natural loss flowing from the Repudiation. In order to prove that a different figure should be awarded for this second loss and that a shorter period should apply, the Defendant must show that it is more than probable that if the Lease had been taken up, the Bank would have terminated the Lease so that only 15 months would have run with the Lease. There was no such evidence. There is evidence that the Bank would have paid $170,000 for the renovation, would have no doubt incurred substantial costs and made improvements when it moved its senior staff into the Flat. There is simply no reason to believe why the Bank would want to terminate after 15 months specially if say by the end of 1995, the market is no longer down but about the same or might be up or even higher than the $180,000 agreed in the Lease. I have no evidence on what the market for the Flat was like at the end of 1995 or the beginning of 1996, nor do I have evidence as to how much the Bank might have to spend on moving to a different flat and what it would cost to find replacement apartment for senior staff. Prima facie, it would seem natural that the Bank would have to pay another agent another commission for finding a new apartment. It is purely speculative for the Defendant to suggest that the Bank would have exercised its option to terminate and that therefore the period of loss should be reduced to 10 months, namely up to 15th February 1996. In the circumstances, I must reject the Quantum Issue raised by the Bank and I regret that those acting for the Bank had seen fit to take a point of so little merit, the result of which reflects badly on the Defendant's overall credibility and indicates an easy willingness to take the path of expediency. REPUDIATION ISSUE 25. As I pointed out to the parties on many occasions, the Repudiation Issue is from the beginning to the end the only substantial point of issue in the Action. This Issue is a simple Question of fact, namely who said what during that brief Termination Call and it is essentially a matter of credibility between Allan and Langlois. This is the primary and most important Question. Unfortunately associated with that factual Question of what happened during the telephone call on the 20th October 1994, are a number of other relevant factual issues ("Relevant Issues") which shed light on the main Question. The credibilities of other witnesses also affect the resolution of the Relevant Issues. Approaches to Documents and Oral Evidence 26. Before making my assessments of witnesses and stating my findings on the various Relevant Issues, it seems to me worthwhile to state what is my general approach to the very vexed question of comparative values of oral evidence and of different categories of documents. So far as documents are concerned, there are genuine documents created contemporaneously which are obviously of value in assessing what happened. Secondly, there are documents which are not obviously genuine and where care must be taken to assessing both its genuineness as well its contents. Then thirdly, there is oral evidence which if coming from the parties themselves or their agents as opposed to independent third parties, requires the greatest scrutiny. 27. In my view, genuine documents created contemporaneously obviously deserve far more weight and credibility than disputed documents or oral evidence. In the category of genuine documents created contemporaneously, the contemporaneous correspondence exchanged between the parties stand out as being the most credible because:-
28. Documents which are created for internal consumption such as internal exchanges and internal notes and memorandum (specially when there is doubt as to the time of creation and the genuineness of such documents) are obviously of less reliability particularly when the contents tend to be self-serving. Then there are the witness statements and the oral evidence of witnesses. Such evidence in the same way as disputed internal documents call for close scrutiny and do not generally deserve the same credibility or weight as contemporaneous correspondence. 29. What I have stated above are fairly self-evident and elementary but as this case involves so much disputed factual matters, it is worthwhile to bear these principles in mind to guide me through the morass of conflicting materials, all vying for the Court's attention and assessment. What are the Relevant Issues 30. A large number of factual matters were investigated and some at great length but with the assistance of the parties, I believe only the following are relevant issues which bear on the question of whether Allan or Langlois was more or less likely to terminate the Lease:-
Assessments of Witnesses 31. But before I proceed to make my factual findings on these Relevant Issues, I will first set out my views and assessments of six witnesses. In assessing the characters and credibilities of the witnesses, I also take into account one very unusual and special feature of this case and that is the Defendant's witnesses had an unusual advantage in telling their versions of the events. Allan and Coleman first gave their signed Witness Statements on 28th July 1995 but with the skill of the Solicitors for the Defendant, the four witnesses of the Bank, namely Langlois, Gloria, Vincci and Rita did not file their signed Witness Statements until late November 1996, some 16 months later. In assessing the evidence and credibilities of the two sets of witnesses, I have not lost sight of how much time witnesses of the Defendant could think about and prepare themselves (with the benefit of the Plaintiffs' Witness Statements) of what to say in relation to the events in 1994. Allan 32. Allan gave extensive evidence before me and I have more than sufficient opportunity to observe her character. She is an unusual mixture, being professionally trained as a dentist but instead of practising her calling had turned to being a landlady/decorator. She has elegance of style in the way she dresses and no doubt also in the way she decorated the apartments owned by the family companies, including this Flat in question. But my most material observation of Allan is that she is a demanding lady, much used to getting her way probably because of being spoilt by her parents. She is a talker and not much of a listener and she is very impatient and before me she had to be slowed down repeatedly when she was giving evidence. She can be charming but she can also be very difficult, what some people might even call a "pain". But she is truthful and not capable of guile or deep thought-out deception. Her memory can sometimes be faulty which accounts for her inability at times to reconcile events or evidence. However I accept her as a truthful witness and whenever there is a conflict between her evidence and the evidence of the Bank's witnesses in the persons of Langlois, Gloria, Vincci and Rita I prefer the evidence of Allan. Coleman 33. His evidence is not long. He is something of a partisan witness. However, he is not a witness whose evidence I would reject. I find him on the whole to be truthful. Langlois 34. Langlois is the opposite of Allan. He is cool, collected, careful and seemingly reasonable. As a very successful and experienced businessman he is a man of the world and obviously used to big business deals and complex commercial situations. Because he is intelligent, he would not tell obviously silly stories and he is very alert to the Court's occasional probings. I do not however ultimately find him to be a candid or forthcoming witness. He wanted to give the impression that both he and his secretary were far less involved with matters such as the problems with meeting the demand of Allan for Renovation Money and the matter of negotiations over the surrender of the Tavistock Flat. In fact he was far more in control although behind the scenes. I am not satisfied that his evidence is reliable and I prefer the evidence of Allan specially on the telephone conversation on the 20th October 1994. Gloria 35. Gloria is a typical Hong Kong success story. She worked for 10 years in the residential department of Jones Lang & Wootton and she must have been very successful as she and another colleague from Jones Lang Wootton started Classic Homes in 1992 which became very quickly a very successful real estate company, specialising in the top end of the residential market. Gloria Wong gave her evidence in English (her English is very good) but there was no gain in time from the fact that Chinese interpretation was not required by her. She is not just careful but calculatingly careful with everything she said and the most outstanding feature of her giving evidence was the frequent long pregnant pauses during which she must have covered every angle before giving her answer. My impression despite her repeated tears is that this is a calculating lady, who is deep, devious and dangerous. She is a lady who thinks ahead as opposed to Allan who just spurts out everything. She is someone who is capable of playing both sides and I find her together with Vincci and Langlois as being the three least truthful of the witnesses who gave evidence at the Trial. Vincci 36. Vincci has also an impressive background and is no doubt a very capable lady. But she is neither consistent nor frank nor straight. She is constantly evasive. She took great advantage of the time gained by the Chinese interpretation but that did not make her evidence better. She has the ability to make her evidence sound plausible and it requires considerable observation of her over the many days in Court while she was giving evidence and while she was listening to the evidence or giving instructions to the Bank's legal team for the Court to reach some appreciation of what is like or capable of. Unlike Gloria she does not need much time to respond to even the most difficult of questions from Mr. Thomson. A trace of a smile over her face is sometimes an indication that the question has hit the mark and the agile brain is busy processing the necessary answer. She is not a witness who inspires confidence or suggests to me that she is a lady capable of telling nothing but the truth. She was at the centre of the web and she was deadly. As in the case of Gloria, I have no hesitation in preferring the evidence of Allan to that of Vincci. Rita 37. Rita is by far the most appealing of the four witnesses of the Bank. She is undoubtedly a very good secretary, loyal and discreet. She gave her evidence calmly and without fuss. She is very professional in her ways and I am not totally unimpressed by her as a person. But as a witness she is not wholly satisfactory and I have considerable reservation with her evidence though not to the same extent as with the evidence of Gloria, Vincci and Langlois, having characterised their evidence as being untruthful. Much of her evidence is not particularly controversial except on one key aspect, namely that Allan threatened termination of Lease on the 20th October which induced her to interrupt the conference of Langlois. As will be seen later, I do not accept Rita's account of what happened. In my view, she was fundamentally mistaken and rather than putting it down as her being deliberately untruthful, it seems to me that the unreliability of her evidence comes more from her inability to remember the events some 3 years ago (an example of this is her non recollection of the Termination Fax page 102-3) and that she had been misled by what she must have been told by Vincci and Gloria of their various encounters with Allan. When there is a serious conflict between her evidence and that of Allan, I reject the evidence of Rita. Disputed Defendant's Documentation 38. My above assessments of the witnesses bring me to how the Court should regard the disputed documentation relied on by the Bank, mainly in the form of faxes alleged to have been received by either Gloria or Vincci or Rita ("Defendant's Fax Documents"). These Defendant's Fax Documents were disputed either because they looked different from the original documents which were transmitted by fax or because the top line printed on these Defendant's Fax Documents purport to show information such as fax number, date and time of fax transmission, page number of such transmission which were disputed. 39. An illustration of the dispute can be shown by reference to Tab 9 of the Defendant's Bundle (Exhibit D4 is supposed to be the Defendant's original) which was purported to be the Complaint Fax at page 99-100. Pages 99-100 show the Complaint Fax as consisting of 2 pages with the 1st page ending with the line "my difficult & if there are" and with the second page at page 100 also a full page. Tab 9 clearly shows the Defendant's copy containing the following features:-
What is important about this Tab 9 is not so much the manuscript contents but what was alleged by the Defendant to be the date and time it was received by Vincci and what also came with it as part of the same transmission, namely Tab 7 which was not a reduced document but which was alleged to be page 1 of the transmission and yet being timed at 11.58 and with page 2 of Tab 9 of the same transmission timed at 11.57. 40. No specific convincing evidence was given by either Vincci or Rita or Gloria about any special extraordinary features of the various fax machines which produced the Defendant's Fax Documents (Rita made some brief unconvincing reference in her evidence). It was generally agreed and I believe it is common knowledge that the data printed on the top line of these faxes such the fax numbers, the date and time could all be programmed and changed. Having regard to my poor assessments of these witnesses and the nature of these disputed documents sought to be relied on by the Bank, I have no doubt that no reliance can be placed on these Defendants Fax Documents whatsoever and specially not on the top transmission line purported to be printed on these documents. In this Judgment, unless I made a particular reference to a document of the Defendant and indicated that I accepted such document as being genuine and accept its contents as being true, it shall be taken that I reject such documents as being genuine or their contents true and that I will always prefer to accept the documents produced by the Plaintiff as being the genuine documents. Findings on the Relevant Issues Was Property Market Down 41. The evidence on this was all one way and namely from Allan pointing the market as being down. Allan had said so in the contemporaneous correspondence and repeated the point in her Witness Statement (see paragraph 4 and 5 of Allan First Witness Statement dated 21st July 1995) to show that firstly she had therefore no reason whatsoever to terminate the Lease (as the rent of $180,000 was a superb rent captured at the top of the market) and secondly as providing an incentive or reason for the Bank to get out of a Lease entered into at the top of the market. Allan in fact was not even cross-examined on this point. Mr. Chan tried to bring in some evidence to show market was not down after July 1994 but the attempts failed. I have no doubt that the property market came down after July/August 1994 and it was certainly very much down by October 1994. The time it took Allan to find a new tenant for the Flat (with the new lease to commence 6 months later) and the much lower rental which the new tenant agreed to pay for the Flat ($35,000 per month less) all indicate powerfully that the market had come down substantially from its height in mid 1994. I therefore find as a fact that in October 1994, the property market had come down substantially from the level when the tenancy was agreed in late June 1994. Gloria's Promises to Pay Renovation Money 42. The question of payment of Renovation Money was what led to the final telephone call on the 20th October. The parties were agreed at the Trial that there were demands for payment of Revocation Money by Allan. The difference of the parties is the reaction to this demand. The case of the Plaintiffs is that in response to the demand, promise was first made by Gloria that the Renovation Money would be paid on 1st October followed by another promise of Gloria to make payment by 12th October 1994. The evidence to that effect contained in paragraph 6 of Allan's first Witness Statement was not even the subject of cross examination of Allan. Yet the Bank tried to dispute these allegations. The contemporaneous correspondence exchanged between the parties support Allan assertions of Gloria's demands. In the Bocastle Composite Letter, Allan made specific reference to the 12th October 1994 as the date she was supposed to be paid the $170,000. In the Complaint Fax, there was specific reference to promise of money by 1st October 1994. These allegations in the contemporaneous correspondence created and sent before the Termination Call carry great weight for me and it is to be noted that they were never refuted in contemporaneous correspondence by those working for the Bank. Gloria in her evidence denied she ever made the promises to make the Renovation Money Payment and said she had no authority to make such promises. Vincci said she knew nothing about these alleged payment promises and that Gloria had no authority to make such promises. Whether Gloria had authority to make such promises is only something which Gloria and the Bank's people dealing with Gloria knew but there is no reason for me to doubt that what Allan had written in the contemporaneous genuine correspondence were untrue. 43. For me, the circumstances of the request for Renovation Money payment were not unusual. Renovation work had to be done before Langlois could move in and it had to be finished by 30th November 1994. For the Bank obviously it would be an advantage if renovation works were finished earlier than 30th November 1994 because it had to start paying the rent from the 16th November. By late September 1994 when the request for payment of Renovation Money was made, there was only something like 2 months left to do renovation work and it was not unreasonable for request for payment to be made or for a positive answer to be given to such request. The Invoice Clause in the Side Letter might legally require invoices to be presented before payment could be made. But as I accept what Allan said, there was a loose arrangment between the parties and certainly in September or early October there was no talk of Allan could not be paid because Allan had not fulfilled the requirement of the Invoice Clause. 44. Apart from the nature of the contemporaneous correspondence and the inherent probability of the promises to pay, there is also the credibilities of the two main characters involved with this question. I have no doubt that I prefer Allan on this aspect. I reject Gloria's evidence on this matter. Termination Threats made by Allan 45. This is an issue which was hotly contested. All the key witnesses (with the exception of Langlois) were involved with this issue. The allegation of the Bank is that from the beginning of October 1994 if not earlier, Allan accompanied her demands for Renovation Money payment by threatening to terminate the Lease. It was said that Allan made such termination threats on at least 3 occasions to Gloria, namely in early October, in the second week of October and then at least once on the 19th October. It was said that Allan made such termination threat on at least one occasion to Vincci namely on the 20th. So far as Rita is concerned, it was alleged that during the telephone conversation at about 2 p.m. on the 20th October, Allan made the termination threat to Rita which convinced Rita to treat the matter as very serious, thereby inducing her to go into Langlois room to interrupt his conference and to tell him about the threat and asking him to take the call from Allan. 46. My first conclusion against the Bank's allegation is based purely on the credibilities of the four relevant witnesses namely Allan, Gloria, Vincci and Rita who gave evidence on this and as I have indicated I prefer Allan's evidence and I find her to be a truthful witness. My findings against the existence of termination threats are therefore based on my assessments of credibilities. 47. However my conclusions against the existence of termination threats are also supported by very convincing material, namely the contemporaneous correspondence. From the time the Lease was dated by Gloria on 10th August 1994 to the time of the Termination Call (a period of about 70 days), there were three instances of contemporaneous correspondence from Allan to the side of the Bank (including Gloria, Vincci, Rita and Langlois) and three instances of traffic from the Bank side to Allan. The three instances of Bank's correspondence to Allan are letter dated 12th August 1994 from Gloria to Allan (page 89) enclosing Lease, the Renovation Items September Fax (page 90) and Fax of Sanitary Ware sent to Allan by Gloria (page 93). The 3 instances of correspondence from Allan to the Bank side are:-
In none of the correspondence from the Bank side to Allan was there any reference to Renovation Money payment or threat of termination of Lease if such money was not paid. In the correspondence from Allan to The Bank side there was however in each case specific reference to Renovation Money payment but although there was in each case demand for payment, there was nothing which could even be suggestive of threat of termination of Lease if such payment was not made by the demanded date. There were the talk of consequences if payment was not made, such as delays or Bank doing the work or putting pressure on Allan. There was however nothing about the termination of the Lease or even the possibility of such termination. In my judgment, these contemporaneous discussions (with Gloria and Vincci) all point powerfully against the existence of such threat of termination. 48. The oral evidence of Gloria Wong is of course to the contrary. Her evidence was that she was threatened three times as I had described earlier starting with early October threat to terminate and ending with the one in the telephone conversation on the 19th October 1994. I do not accept her evidence and I accept the evidence of Allan. I hold that no threat to terminate had been made by Allan to Gloria. In fact, my findings of Gloria's promises to pay reinforce my finding that there was no threat to terminate the Lease. When there was already promise to pay, there was no need to resort to threat and it is only when a party refused to pay does another party ever need to resort to threat. In my judgment, no question of threat to terminate ever arose because Gloria had been promising to pay initially by 1st October and then by 12th October 1994 and then followed by the devise of the Bocastle Letter. To my mind it is inconceivable that if Gloria had refused payment in late September or early October that it would have taken so long for the matter to reach a head in the way it did on the 19th and 20th of October. The only way threat to terminate would arise was if Gloria instead of promising to pay had said no payment could be made and in her frustration then Allan resorted to threat. But this was neither borne out by subsequent events nor by the contemporaneous correspondence. In my judgment, Gloria was never threatened and her story of being threatened was just made up. In this context I have not overlooked the alleged Fax dated 20th October from Gloria to Vincci to be found at Exhibit D13 (page 104) where the allegation was made that Allan threatened the termination of the Lease the evening of 19th. I do not believe that document is a genuine contemporaneous document purportedly faxed on 20th October at 8.42 a.m. that morning. For reasons which I had stated earlier. I do not accept any document emanating from the Bank's side in the form of faxes or letters as being what they purported to be and particularly in relation to the time they were purported to be created. That alleged Fax of 20th October from Gloria to Vincci at page 104 (just as the letter at page 105 which was self-serving and created after Gloria knew about the Termination Call but written by her in such terms as giving the impression that it was written before the Termination Call) therefore does not help the Bank in persuading me that Allan made threat to Gloria on the 19th October to terminate or that she had at any time made such threat to Gloria. 49. I now turn to alleged threat to terminate made against Vincci. This was alleged to have been made on the 20th October but there was no contemporaneous documents to support this allegation and not even in the letter dated 21st October from Slaughter and May was there a reference to this threat made to Vincci. I do not accept Vincci's evidence of the alleged threat of termination made to her by Allan and I accept the evidence of Allan that no such threat was made. 50. The same can also be said about Rita. It is alleged that in her request to talk to Langlois at shortly after two, Allan threatened termination and it was for that reason, Rita then went to interrupt the conference of Langlois. This was nowhere referred to in the contemporaneous documents, not even in the letter from Slaughter and May. I reject regretfully the evidence of Rita on this and I prefer far more the evidence of Allan. It is of course possible for Allan not to have made any previous threats but suddenly started to do so on the 20th October (first with Vincci and then with Rita) but there would hardly be any reason why suddenly she changed from not threatening from 1st October 1994 in all her dealings with Gloria that when she got to Vincci and Rita on the 20th October, she suddenly became so belligerently bluffing. 51. Before I leave this subject of the alleged threat to terminate, it is worthwhile thinking a little bit about the inherent probabilities of what went on. It is of course true that Allan wanted the money and kept insisting on it for a long time, at least since the 1st of October 1994. But she is not a stupid lady and certainly not a lady who I believe would take to empty threats. Fundamentally of course any threat to terminate the Lease in this case was an empty threat (bluffing) which must be plain to everyone. The market was very much down at that time in early October and no landlady in her right senses would want to jeopardise a lease about to begin shortly which commands a rent much higher than the prevailing market rate. A threat is only of any use if when the threat was carried out, the consequence to the other party is worse. For a landlord to make a threat of termination in a rising market is one thing and at least makes sense. But this alleged threat by Allan was plainly a paper tiger and could be seen to be so and yet I was asked to believe that Allan who was a professional and intelligent woman had made that threat, not only once but repeatedly with increasing nil result as she went up the corporate ladder. Not only did the evidence not support the Bank's heavily stressed case on termination threats but the inherent probabilities of the circumstances point to the unlikelihood of such events having taken place. I have no hesitation in concluding that no termination threats were made by Allan to Gloria, Vincci or Rita. Bank Using Own Contractor & Allan Feeling of Bank Messing Her Around 52. Although both Vincci and Langlois, much to their discredit, tried to distance themselves from any question of the Bank using own contractor, the evidence suggests to me that there is substance in Allan's assertion that she was thoroughly confused and uncertain as to whether the Bank was proposing to use its own Contractor and this of course has a direct bearing on why she was having difficulty in receiving payment for the Renovation Money. 53. It is not a figment of Allan's imagination which led her to inform the Court about her uncertainty at that time in October of the Bank using its own contractor. Her contemporaneous correspondence supports her case fully. Both in her Bocastle Composite Letter (page 91) and in her Complaint Fax (page 99) there was reference to the Bank doing the work itself. Gloria in her evidence agreed with Allan and confessed to talking to Allan about this possibility directly as result of receiving the imput from the Langlois. I hold therefore as a fact that Allan did believe that the Bank was possibly considering using own Contractor which was therefore very much connected with the difficulty of getting payment and this together with the seemingly changing positions of the Bank were what caused Allan to be puzzled, felt frustrated as being messed around by the Bank and therefore writing in the way she did, by in particular her Complaint Fax (page 99). 54. The fact of Allan being puzzled and confused and thinking that the Bank might be using its own Contractor does not however make it more likely that Allan would terminate the Lease. In fact it is the opposite as she would be more careful to preserve her valuable asset of the Lease. What it did lead her to do was to find out from Langlois direct what was happening so that she knew what effect it would have on the Renovation Work which she said she had already started and on the delays which might affect her rental income. Renovation Work Started Or Not 55. This minor issue only has a relatively unimportant effect on the main Question of who terminated during the telephone call. The Defendant said that no Renovation Work had been started because that was what Allan told Gloria. I do not believe Gloria's evidence. Allan said Renovation Work had started but was unable to give too much details. There is no doubt that the cheque of $100,000 had been given to Coleman on 1st October 1994. What is not clear is how much work had been done. I accept the truthfulness of the evidence of Coleman but reading between the lines, I form the view that around the time of the serious problem of the Bank creating difficulties with payment to Allan, although work might have started in the three bathrooms they might not have advanced in any significant manner and I am not even sure because of the lack of precision on what works were supposed to have been done, that I could say that on the 20th October, how much work had been done. It is not unimportant how much work had been done because the more work had been done, the less likely Allan would want to terminate the Lease (although this was really small money compared to what was at stake in the 2 years Lease). What is very significant is that Allan had committed to work being done and on this I have no doubt that being the person she is and with her relationships of peoples she had been dealing with, including Coleman, she felt she was fully committed to the work being carried out which of course brought considerable urgency to the matter and which caused her eventually to talk to Langlois, not in order to threaten him (as if he could be the sort of person who might sudden give in to her empty threats) but in order to clarify once and for all the constant changing positions (with payments yes today and no tomorrow; we want this document today and we want another document tomorrow; and then after all documents were given, still considered documents not good enough). The evidence indicates to me and I so find that the Renovation Work started sometime before early October and that Allan felt she was more and more committed to the Renovation Work and its expense but there was uncertainty as to what was happening as payment repeatedly promised was again and again not produced. Knowledge of Staying on at Tavistock Flat 56. The discovery of documents by the Defendant in this Action had been very problematic and much material had to be dragged out of the Defendant but right towards the end, the documents disclosed in the Defendant's Seventh Supplementary List ("Surrender Documents") threw very different light on what happened with the Tavistock surrender negotiations and the veracity of Langlois. 57. Langlois in his evidence wanted the Court to believe that he was not involved with the surrender and that all he knew was that he had to be out of the Tavistock Flat by the end of 1994. The Surrender Documents however show quite clearly that the Bank and its senior officers including Langlois knew that it was fine with Kerry for the Bank to stay on until early next year and that there was considerable flexibility with Kerry in terms of the Bank staying on for some time beyond the end of 1994. It is true that the evidence did not positively reveal that Langlois knew on the 20th October that the redevelopment would not be taking place (the Surrender Documents show a substantial gap in the period immediately before the 20th October) but having regard to my assessment of Langlois and my conclusion of his unreliability as a witness, I am unable to make a finding of fact that Langlois knew on the 20th October that the Bank would have to vacate the Tavistock Flat by end of 1994 and that the Bank would definitely be receiving substantial compensation for the Tavistock Flat surrender. 58. In my judgment, despite the denial of Langlois that the property market was down, I find that he knew that the property market was down and that he could stay on somewhat beyond the end of 1994. How long he could stay on of course would depend on when and if the proposed redevelopment would take place but with his knowledge that the property market had gone right down, it does not take much for some one of his financial background and ability to infer and reach a pretty good idea that the proposed re-development was at risk and therefore also the large compensation and the moving allowance which was to pay for the Renovation Works. Repudiation Call - Who said What 59. Against the above background and with my findings of facts on the various matters leading to the fateful telephone conversation on the 20th October 1994, I can now proceed to consider what happened during that telephone conversation. But before I do that, it seems to me important to state what I perceive to be in the minds of both persons before they started the telephone conversation. 60. Based on my findings, I would summarise the position facing Langlois on the 20th October before the telephone conversation as follows:-
61. Based on my findings, I would summarise the position facing Allan before she started the telephone conversation as follows:-
62. The evidence of Allan was that she started the telephone conversation by telling Langlois about her confusion on the renovation and her problem in trying to be paid the Renovation Money and therefore she wanted to clarify the matter with him when he interrupted her and said he was very busy and how dared she called him. He said to her it was all in the hands of Vincci and that she must accept what Vincci said. Allan said she was confused by what Vincci said and why she was being offered only $85,000 and she did not know whether the Bank wanted Allan to carry on with doing the renovation work as the Bank was querying her non-professional invoice. He said there was no confusion and Allan was to take it or leave it. She then asked Langlois what did it mean, did it mean that the bank wanted to pay her $85,00 or the Bank contractor was doing the work or the Bank was going to pay her anything at all or what. Langlois according to Allan then said that he didn't want to have anything to do with her any more, whereupon Allan asked him where did that leave where they stood with the Lease and did that mean Langlois did not want to go ahead with the Lease and he said yes. She tried to calm him down and she said she was sorry that he had a bad day because so did she, whereupon he did not answer her but put the phone down on her. According to Allan, the conversation was stormy but brief and he ended by terminating the Lease and banging the phone down on her. 63. The evidence of Langlois was quite to the contrary. He said she started by asking to be paid the $170,000 and he told her he was unhappy about her threatening to terminate the Lease and that he had staff to deal with payment issues and the Bank had proposed to pay half when she interrupted him and said "If that is the way you are going to do it, I will terminate the lease, my mother is very ill" to which he said well fine, go right ahead and she said fine and that was how the telephone ended. Langlois said the telephone conversation was not stormy and he was not angry and it was Allan who terminated the Lease during that telephone conversation. He disagreed very strongly with the suggestion by Mr. Thomson that Allan asked him does that mean you don't want to go ahead with the tenancy agreement to which he said yes. 64. Having heard and seen both Allan and Langlois over many many days, both when they gave evidence and when they were sitting in Court and on the basis of my assessments of the two of them as witnesses, I have no hesitation in preferring the evidence of Allan to Langlois. Her description of how the conversation went, fit in with my assessment of how they would behave during that telephone call: stormy, difficult, fast and explosive. The picture which Langlois tried to give to the Court might put him in character but would totally put Allan out of character. This is a pushy, irrepressible lady who was always talking and it is impossible for me to accept that after all the efforts she had gone through finally getting to talk to him, she would firstly terminate the Lease at all and secondly that if she was going to do it, it would be done in that tame manner of "If this is the way you are going to do it, I will terminate the lease ... " and he said "fine, go ahead." Purely on a matter of credibility therefore and on that alone, I would reject the evidence of Langlois and accept the evidence of Allan. 65. I am however reinforced in my conclusion that it was Langlois who did the termination, by three other factors. 66. The first factor is the inherent probability of who was more likely to terminate. Given my findings set out earlier, there was logically no reason for Allan to terminate and even someone who is not very bright could see and understand that no sensible person could possibly want to terminate the Lease simply on the matter of disagreement as to timing of payment of half of the Renovation Money. And I have said that Allan is intelligent. On the other hand, there are good and highly persuasive reasons why Langlois would want to terminate. All financial factors would suggest that it would be in the interest of Langlois to terminate. He could get the best of 3 possible worlds for the Bank: get out of a bad lease entered into at the top of the market, continue to stay at Tavistock at lower rent or even go elsewhere at lower rent and getting the large compensation as well as removal allowance if that should materise. But even if surrender and compensation does not materialise, it would still be the best of two worlds and that is commercially sensible for him. From the inherent and logical probability point of view, it seems to me that much more is to be said for Allan's version than Langlois' version. 67. The second factor is the immediate action of the parties after the telephone call. When he refused to take her call, Allan immediately sent him a fax which was received something like 15 to 20 minutes after the telephone call. The Termination Fax (page 102-3) is a crucial Fax with all the advantages of it being immediately after the event and that it was sent to the other side requiring a response. Allan said in that Fax that Langlois terminated the Lease and wanted his confirmation by 6 p.m. that day. He did not confirm and he did not contradict her by his fax but instead he said he was too busy that day to send a return fax. Coming from a banker of his standing and experience, it is really too much for him to expect that lame excuse would be accepted by this Court. It was incumbent on him to respond immediately to the Termination Fax but he did not. The Terminaton Fax for me therefore speaks powerfully the truth. 68. The only thing which could be said against that Termination Fax is that its contents were untrue (as suggested by Mr. Chan) and that Allan was deliberately creating a document in her favour. But my assessment of Allan is that she is not the sort of person who was capable of that sort of foresight. She was impulsive and quickly reactive but she was not devious or deep thinking like Gloria or Vincci. 69. The third factor in support of Allan's case is that even on the basis suggested by Mr. Chan that it was a wholly irrational act which terminated the Lease, the question is which irrationality was more likely. Was it an irrational act by Allan or was it an irrational act of Langlois. Having seen and heard Allan and Langlois over such a long period and knowing the way they behaved, responded and acted, in my view if there was an irrational element in the termination of the Lease, it was not her irrational act but it was the final irrational exasperation of Langlois with Allan. She was difficult, she was pushy, she was a pain and she was too much for him and probably for everyone in the Bank to take and he wanted to get rid of her and he wanted to have no more to do with her. A perfectly otherwise cool and rational man then became irrational and said yes and for the wrong reasons. I have seen Langlois when he was rattled upon being pressed by Mr. Thomson and I believe that was how he reacted when Allan pushed him too much that afternoon. He snapped and said yes. He was angry, so angry that he banged the phone down. That was said even by Rita his loyal secretary who heard it outside at her desk. I believe her when she said that. He denied it but he did. The interruption of his conference by the earlier insistent call of Allan had annoyed and angered him so much that during the telephone conversation with Allan, he allowed his anger to dictate his response. I find that Langlois repudiated and terminated the Lease during that telephone conversation. 70. In the circumstances, there must be judgment to the Plaintiffs in the sum of $1,557,407.50 claimed in the Amended Statement of Claim together with interest thereon at the rate of 2% above prime from the date of the Writ, 25th January 1995 until Judgment. The Counterclaim of the Defendant must be dismissed. The Plaintiff is to have the costs of the Action.
Representation: Mr. James Thomson for the Plaintiff instructed by Messrs Oldham Li & Nie Mr. Kenneth C.L. Chan for the Defendant instructed by Messrs Deacons, Graham & James |