Wong Ming Chin v. Shing Shiaw Shuh

HCA008917/1992

IN THE HIGH COURT OF HONG KONG

COURT OF FIRST INSTANCE

Coram: The Hon Mr Justice Findlay, in Court

Dates of hearing: 6 and 7 October 1997

Date of handing down of judgment: 14 October 1997

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JUDGMENT

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Background

1. This action concerns events that happened some thirty-eight years ago. Then, a flat in Argyle street (the property) was purchased. It was assigned into the name of Mr Shing Shiaw Shuh (the deceased), although it was never occupied by him. Instead, it was occupied by the plaintiff, who lived there for all those years without paying anything to the deceased.

2. The plaintiff says that he paid for the property, and it was assigned to the deceased to hold in trust for him. The defendant says that the deceased paid the purchase price, and there was no trust.

The Pleadings

3. On 16 December 1992, the plaintiff commenced proceedings against the deceased by writ of summons. The writ had a general endorsement of claim by which the plaintiff sought a declaration that the property was held by the defendant upon trust for the plaintiff absolutely. The plaintiff also asked for an order that the defendant transfer and assign all interest in the property to him.

4. Nothing more was done by the plaintiff to advance his claim until 24 March 1994 when he filed and served his statement of claim. Nothing more was done in this action, but it must be said that the plaintiff was not sitting on his hands. He was taking other proceedings against the deceased.

5. The deceased died on 10 March 1994.

6. In his statement of claim, the plaintiff alleged that, in early September 1959, he was seeking a divorce from his wife, whom he had married only about one month before. In order to avoid "the financial demands of his wife and her incessant disturbances", he decided to move from the matrimonial home and purchase the property. The plaintiff says that, upon his request, the deceased consented to hold the property on trust for him. The purchase price of $63,000 was paid by the plaintiff. The plaintiff says that, under his directions, the deceased paid the developers, the Hang Lung Land Development Company Ltd, on the plaintiff's behalf, by two instalments with two cheques drawn up by the plaintiff and affected the purchase of the property, holding the same property on trust for the plaintiff. The plaintiff alleges that, at all material times, the deceased agreed and understood that the property would be transferred to the plaintiff at a later stage at the request of the plaintiff. Further, the plaintiff says that he took possession of the property from the developer as soon as the occupation permit was issued, and has since enjoyed sole and exclusive occupation of the property. The deed of assignment and related papers of the property were in the custody of the plaintiff after the assignment, but, in about 1986, the deceased borrowed the deeds in order to enhance his chances for a successful application for immigration to Canada. The deceased undertook to return the deeds, but failed to do so in spite of requests by the plaintiff.

7. The statement of claim includes an alternative claim that the plaintiff had acquired a possessory title to the property, but Mr Miu does not seriously pursue this. He recognises that, if there were no trust and the plaintiff was in occupation of the property, he could only have been doing so under a licence from the deceased.

8. In an amended defence and counterclaim, the defendant alleges that the deceased entered into a sale and purchase agreement on 8 January 1960 relating to the property at the price of $63,000 to be paid by three instalments - the first of $6,300 upon the signing of the agreement, the second of the same amount to be paid upon the completion of the ninth floor, the third of the same amount to be paid upon the completion of the roof, and the final instalment of $44,100 to be paid within seven days after the issue of the occupation permit. The purchase of the property was from Hong Tung Tick and Hong Lap Hing through Tai Lung Construction and Investment Company Limited. The defendant alleges that all four instalments of the price were duly paid by the deceased by way of cheques issued by the partnership, being drawings made by the deceased on account of his profits.

9. The defendant denies that the property was ever held on trust by the deceased for the plaintiff, and that, at all times, the deceased was the legal and beneficial owner of the property.

10. The defendant alleges that it was the deceased's intention to use the property as his matrimonial home, but, at the beginning of 1960, the plaintiff told the deceased that another sister of the plaintiff was coming to a Hong Kong with her children. At the request of the plaintiff, the deceased agreed to grant a licence to the plaintiff to occupy the property as a residence for the plaintiff, the plaintiff's mother, the sister and her children and the youngest sister of the plaintiff pending the arrangements for suitable alternative accommodation. It was agreed between the plaintiff and the deceased that no licence fee would be payable, but the plaintiff would pay all rates, management fees and all outgoings in respect of the property.

11. The defendant alleges that the property was assigned to the deceased, that he paid various utility deposits, for the decoration of the premises and all legal expenses in connection with the purchase. The defendant alleges that the title deeds and all receipts of deposits and expenses have been in the possession of the deceased.

12. The defendant alleges that on 4 February 1995, the defendant gave notice to the plaintiff that his licence was terminated, but that the plaintiff has failed to surrender possession of the property.

13. In a counterclaim, the defendant claims a declaration that the plaintiff has been occupying the property as a licensee at will, and that the licence has been terminated.

14. In his reply, the plaintiff says that the four instalment payments were made by the plaintiff personally through the defendant to Tai Lung Construction and Investment Company Limited, and that the defendant had performed the purchase on behalf of the plaintiff on his instructions.

The Evidence

The Plaintiff

15. In his written statement, which he confirmed when he gave evidence, the plaintiff said he decided to buy the property in 1959. He came to know about the property through the introduction of a friend named Anthony Lee Nam. Mr Lee was purchasing a flat in the same development. He says that he does not remember how the purchase price was to be paid except that it was to be done by a few instalments. Mr Lee migrated to Canada a long time ago and he does not know where he now is. The plaintiff says that the developer was Tai Lung Construction and Investment Company Limited.

16. In the purchase agreement, his name was put down as the purchaser. He paid the initial deposit in cash to Mr Lee, and Mr Lee then paid the developer. Later, he talked to the deceased about his worry that, if the property was registered in his name, he was afraid that his wife might come after it. He asked the deceased if he could cause the property to be registered in the name of the deceased so that the deceased could hold the property for him and transfer it to the plaintiff after the divorce was over. The deceased agreed to this request. The plaintiff then asked Mr Lee to change the name on the agreement to that of the deceased. Mr Lee told him that the change had been made. He then gave the deceased the cheques for the second two instalments. These were the plaintiffs personal cheques; his own money. The plaintiff's bank account shows debits of $6,300 on 1 August 1960 and 11 October 1960.

17. Regarding the final payment of the balance of the purchase price, the plaintiff says that he gave the deceased cash in the amount of $10,100 and his personal cash cheque in the sum of $34,000. This cheque was paid into the deceased bank account. The deceased then issued a cheque for the full amount and gave it to the solicitors. The deceased gave to him the key to the property and also the title deeds.

18. The plaintiff says that he has been residing the property since February 1961. In 1986, the deceased told him that he was going to migrate to Canada. The deceased asked him for the title deeds to the property. He gave the deeds to the deceased. In 1991, the plaintiff asked him to return the deeds, but their deceased refused.

19. The plaintiff says that his divorce was made absolute in July 1963. After that date, he did not ask the deceased to transfer the property to him "as I thought we were partners and we were in good relationship". The plaintiff says that, if he had asked the deceased to transfer the property to him, this might be interpreted as an act of mistrust on his part.

20. The plaintiff says that, in 1972, the deceased's wife, who is the plaintiff's sister, purchased another property in Argyle Street for the price of $190,000, with a mortgage of $100,000, and the deceased and his family moved into this property.

21. During his evidence, the plaintiff was shown the provisional agreement. He said that he saw this in about 1960. He says that he thinks the deleted characters were those of his name.

22. He was referred to the cheque by the defendant to him in the sum of $40,000 dated 17 January 1961. He says he drew a cheque in this sum on 3 August 1960. His evidence seemed to be somewhat confused about this, but it appeared that his evidence was that he paid $40,000 to Mr Lee on 3 August 1960 as a loan. Mr Lee repaid this by cheque, and he gave the cheque to the deceased. There is a deposit of $40,000 into the deceased's account on 31 October 1960. This was to enable the deceased to make payment of the fourth instalment of the purchase price. However, the money was not required for payment on the fourth instalment at this time so he asked the deceased to repay the money to him, which the deceased did in January 1961. There is a debit of $40,000 on 17 January 1961. When the money was required, the plaintiff gave the deceased a cash cheque in the sum of $34,000 and also gave to him $10,100 in cash. The plaintiff's account shows a debit of $34,000 on 7 February 1961, and a corresponding credit to the deceased's account on 6 February 1961. There is also a credit to the deceased's account of $10,000 on 7 February 1961, and a debit on the same day of $44,100.

23. The plaintiff says that he reimbursed the deceased for payments that the deceased made in respect of the property. The plaintiff says that the deceased gave him the title deeds. In 1986, the deceased asked him for the deeds. He made a copy of the deeds after the deceased had given the originals to him. He produced this copy of the deeds. It is accepted by Mr Pow that, at the relevant time, the plaintiff could not have obtained this copy from the Deeds Registry.

24. The plaintiff says that, in November 1990, the deceased, his widow and their son did come to the property. There was an argument and the relationship soured. She says that there was no discussion about selling the property and no claim by the deceased that he was the beneficial owner. There was no meeting at a restaurant in February 1991.

25. Under cross-examination, he denied that he was the only signatory on the partnership bank account, although he conceded that he signed all the cheques in evidence.

26. There was no documentation in relation to the loan to Mr Lee.

27. When he saw the provisional agreement, it was not amended, or with the characters deleted or obliterated as they are now.

28. When the plaintiff paid the first instalment of the purchase price, he had not decided to use the deceased's name. This was done only when the second instalment was due. At that time he had already decided upon a divorce. He agreed that the reason why he decided not to use his own name was so that his wife would not get the property. His wife did not try to get maintenance. He agreed that as early as 1963, the purpose for using the deceased's name had already gone.

29. He said that it was clearly agreed that when the divorce proceedings were complete the property would be transferred to him. He did not ask the deceased to transferring their property to him at any time until about 1991 or 1992. He asked then because of the argument and because the deceased had taken money from the partnership. He paid $10,100 in cash, although he had sufficient to in his bank account to pay a cheque for the full amount, because he wished to leave the balance in the bank for other purposes. He denied that he knew that the deceased was suffering from terminal liver cancer when he issued his writ. He agreed that he probably knew that the deceased had died when he issued his statement of claim. He explained the incorrect allegations in his statement of claim about the developer by saying that the two companies were related. He said in his statement of claim that there were only two instalments because he could not remember clearly, and he had paid two cheques of $6,300. He agreed that he corrected this only after it had been pointed out in the defence.

30. In his reply, he said there had been no decoration of the property. He cannot remember when he recalled that there had been decoration of the property. He said that the last instalment was not paid by his personal cheque because this instalment was to be made to the solicitor. He says that, after the deceased borrowed the deeds in 1986, he never asked for their return. He made a copy of the deeds because he might lose the original. He explained that he drew much more from the partnership than the deceased because she had to pay the workers and pay expenses. He denied that the deceased had lent $40,000 to him, and that when the deceased was pressed for payment of the last instalment, the deceased asked him to repay the debt. He agreed that he had not said anywhere in his statements that he had made a loan to Mr Lee. He denied that he had made this up to explain the payment to him of this sum. No prospective purchases came to view the property. He did ask the deceased to return the deeds, but not until he quarrelled with the deceased in 1990. Only then did the deceased allege that the property belonged to him. He agreed that he did not take any action at that time. When he first received the provisional agreement, his name was not crossed out. He asked that the name be changed to that of the deceased, and he did not see the document after that. He says that the only time that the deeds were taken from his possession was in 1986. He was shown some documents relating to an application for exemption from property tax for owner occupiers. These documents show the deceased to be the owner and also an occupier. One of the documents indicates that the deeds had to be produced for the purposes of the application. This was in 1967. The plaintiff says that the deeds could not have been produced for this purpose because they were in his possession. The cheque for the final instalment was originally made to the developer but was amended to make it in favour of the solicitors.

31. He agreed that, after 1963, there was no fear of any threat by his former wife. But he did not ask the deceased to assign the property to him in accordance with the agreement because their relationship was harmonious and such a request would imply that he did not trust the deceased. He thought this would endanger their relationship. This same reason applied when the question of the property tax exemption arose. He agreed that Mr Lee was purchasing a unit in the same and building and would have needed money to complete. He was shown obituaries relating to the deceased in the newspapers dated 20, 21 and 24 March 1994, but he insisted that he did not know, at that time, that the deceased had died.

The Widow

32. In a statement made in October 1996, the deceased's widow, Mdm Wang Lin, says that the plaintiff incurred a great deal of the expense in relation to his marriage and the dispute with his wife. She says that, at about the end of 1959, she and the deceased purchased the property to be used as their matrimonial home after the marriage. Shortly before the completion of the purchase, the plaintiff and the mother asked the deceased and her to allow the plaintiff and other members of the family to occupy the property, and she and the deceased would, after marriage, move temporarily to other premises to be rented by the deceased. She said is that, for family reasons, it was decided that the licence would be granted gratuitously to the plaintiff and his family to occupy the property.

33. After the property had been decorated, she, the plaintiff, and other family members occupied the property. When she married the deceased on 20 May 1961, she moved out.

34. She says that the deceased was always the sole and beneficial owner of the property, and it was never held in trust for the defendant. She agrees that, in about 1986, they did apply to migrate to Canada, but the title deeds of the property were at all material times kept in the possession of her and the deceased. They were kept in a deposit box opened in their names and rented from a bank. Neither she nor the defendant made any request to borrow the deeds. She says that, on one occasion at the end of 1990, at the property, in the presence of herself and her son, Philip Shing, the deceased informed the plaintiff that he desired to sell the property. The plaintiff told them that he needed to live in the property, and would not agree to a sale. The plaintiff said he would agree to a transfer of the property to her sons.

35. This witness made an affirmation on 26 September 1997. I allowed this into evidence under a hearsay notice because there was evidence that the widow was too sick to travel. Earlier, she had made an unsuccessful application to postpone the trial because of her medical condition.

36. In this affirmation, she says that she came to Hong Kong in 1957 with her mother, and was later joined by her youngest sister in 1958. They all lived with the plaintiff. In about 1959, she and the deceased decided to get married. The plaintiff also decided to get married and incurred heavy expenses. At about the end of 1959, the deceased became aware of the property through the plaintiff. She and the deceased visited the site, and they decided to purchase the property as the matrimonial home. The deceased asked the plaintiff to request Mr Lee to assist the deceased in purchasing the property. When the deceased and she received the provisional agreement, they found that the purchaser and the address on it were both wrong. She does not explain in what way they were wrong. The deceased immediately notified the developer to correct the mistake. For the second and third instalments of the purchase price, the deceased requested the plaintiff to issue partnership cheques to pay for them. She produces the deceased's cheque dated 17 January 1961 in the sum of $40,000. She says this was a loan that the deceased made to the plaintiff at the plaintiff's request. For the last instalment of the purchase price, the deceased again requested the plaintiff to issue a partnership cheque. At that time, the plaintiff mentioned to the deceased that both the second and third instalments were paid from his personal account because there was insufficient money in the partnership account. He also told the deceased that there was insufficient money in the partnership accounts to issue a cheque for the last instalment so the deceased asked the plaintiff to repay the loan. The plaintiff said he could repay only $34,000. She produces the plaintiffs cash cheque dated 7 February 1961 which was deposited into the deceased's bank account. The deceased deposited another $10,000 in cash into his account so that he could write a cheque for the final instalment

37. The plaintiff and her mother asked the deceased and her if the plaintiff, her mother, her youngest sister and she could temporarily move into the property upon completion, to be joined later by another sister and her children until suitable alternative accommodation could be found by the plaintiff. She and the deceased, after marriage, would live in rented premises until they could move to the property. She and the deceased took the view that her family members would soon become her husband's relatives, and that the tenancy of her husband's rented flat had yet to expire, so they agreed to this arrangement. The plaintiff and other family members moved into the property.

38. The title deeds of the property were always kept in their possession. Neither she nor the deceased made any request to the plaintiff to borrow them. Towards the end of 1990, in the presence of herself and her son, Philip, the deceased told the plaintiff at the property of his intention to sell the property. The plaintiff said that he needed to live in the property and begged the deceased not to sell it as he was old and had no one to take care of him. On another occasion at a restaurant, the deceased confirmed to the plaintiff his intention to sell their property. The deceased offered to assist the plaintiff to migrate to Canada.

39. In November 1990, the deceased instructed estate agents to sell the property. In February 1991, then deceased placed an advertisement for the sale of the property in a newspaper.

40. In September 1992, the deceased was diagnosed as suffering from terminal liver cancer. The plaintiff initiated legal proceeding in December 1992 without first contacting them to try to resolve the issue privately.

Philip Shing

41. In a written statement dated 15 September 1997, the deceased's son, Philip Shing, says that in about December 1990 he accompanied his parents to visit the plaintiff at the property. The deceased indicated to the plaintiff that he wished to sell the property to a facilitate his Canadian citizenship application. The plaintiff begged the deceased not to sell the property because he wished to live in it; he was old and had no one to take care of him. The plaintiff did not say that he had any interest in the premises or that he wished the deceased to transfer title in the property to him as the deceased was holding it upon trust for him. He says that his parents took him to meet the plaintiff on a second occasion at the Sing Kong Restaurant in Mongkok. The purpose of this second meeting was to discuss further the sale of the property by the deceased. During the discussion, the deceased confirmed his decision to sell the property. Once again, the plaintiff asked the deceased not to sell the property and suggested that the title be transferred to the sons. At this second meeting, the plaintiff said nothing in relation to his interest in the property and did not claim that he was the real owner.

42. Mr Philip Shing gave evidence. He confirmed what he had said in his statement, but he had more to add.

43. He says that in about 1981 he saw the title deeds of the property. He says that he kept a collection of currency notes in a secret drawer. Once, when he opened this drawer, he saw an envelope. He opened this and saw the deeds. He was surprised to see these in the secret drawer. He was surprised to see the address in Argyle Street because he believed that this property belonged to the plaintiff. He asked his parents about the deeds and they told him that the property belonged to the deceased. On the same occasion, he saw the deeds of the property where they live which belonged to his mother. He says that he opened the envelope because he mistakenly thought it was his. As soon as he opened it, he realised it was not his. He also saw the provisional agreement. His father never told him why it had been amended, but later he asked his mother. His mother said that they had asked the plaintiff to assist in the purchase of the property, and that when the agreement was returned, a mistake had been made and this was corrected. He cannot say that the original name on the agreement had been that of the plaintiff.

The Deceased

44. The deceased made an affirmation for the purposes of these proceedings on 4 March 1994 at the Queen Mary Hospital. In this, the deceased said that he decided to use drawings from the partnership to purchase a property. On 8 January 1960, he entered into an agreement for the purchase of the property. He produced the provisional agreement, which is in Chinese characters. He recites the terms of the agreement as to the payment of the instalments as pleaded by the defendant. He says that, pursuant to the agreement, he duly paid the four instalments of the purchase price. The source of the payments were funded by drawings has made by him on the partnership. He says the four payments were made by four cheques issued by the partnership and drawn on the partnership's bank account. He produces three receipts covering the second, third, and fourth instalments. The deceased says that the property was registered in his name. When he entered into the agreement to purchase the property, he was as a bachelor living in rented accommodation. The plaintiff was living with his mother and two sisters in other rented accommodation. When he purchased the property, it was with the intention of using it as his matrimonial home. Shortly before the property was complete, the plaintiff and his mother asked him to allow the plaintiff and his family to move into the property as licencees until suitable alternative accommodation could be arranged, and the deceased and his wife, after marriage, would move temporarily other rented premises. The deceased says he took the view that the plaintiff and he were going to be relatives so he gratuitously granted the licence to the plaintiff and his family to occupy the property.

45. The deceased produced a number of documents indicating that correspondence with the developer was with him. He also produced documents indicating that he paid certain expenses in relation to property, including legal expenses relating to the purchase.

46. In about March 1961, the plaintiff and his family moved into the property to occupy it as licensees without payment of any licence fee. He married the plaintiffs sister on 20 May 1961. After their marriage, his wife moved to reside with him. All the rates and outgoings in respect of the property since the occupation by the plaintiff have been paid by the plaintiff.

47. The deceased says that he was and is the sole and beneficial owner of the property, and the plaintiff has no interest in it. The property has never been held by him in trust for the plaintiff. He says that he has instructed his solicitor to terminate the licence and give notice to the plaintiff to vacate the property.

Assessment of the Evidence and the Principle Issues

48. I set out below my approach to the evidence and my conclusions on the main issues.

Credibility

49. Only two witnesses gave evidence viva voce; the plaintiff and Mr Philip Shing. The plaintiff gave his evidence in Chinese. Mr Shing gave his evidence in English. I could not tell from the demeanour of either of them that they were obviously telling the truth or obviously lying. This case has to be decided on the probabilities, assisted by the contemporaneous documents and the consistency or otherwise of challenged evidence with other available evidence.

50. As I have said, most of the events concerned took place a long time ago. Accordingly, I attach little weight to inconsistencies in matters of detail. These are probably due to natural failings in memory.

The Introduction to the Property

51. The evidence of both parties is consistent to the extent that it was the plaintiff that found the property and that Mr Lee Nam was involved in this. The widow says that the plaintiff told the deceased about the property. She says that the deceased asked the plaintiff to secure Mr Lee's assistance in purchasing it. It is clear that Mr Lee did act as a middleman. It is also clear that when the provisional agreement was prepared, the deceased was not named as the purchaser. The defendant's evidence is shy about revealing whose name was written there. The plaintiff says that it was his name that was written as the purchaser. There are, it seems, only two possibilities; the name was that of the plaintiff or that of Mr Lee Nam. The name on the agreement is not simply struck out, as is the address that was originally there; the original name is heavily scribbled over, giving the appearance that whoever did this was attempting to avoid it being read thereafter. The original name has three characters, as does that of the plaintiff; the name of Mr Lee Nam has two characters. What can be seen of the strokes of original partly obliterated characters is consistent with the characters of the plaintiff's name. The probability is that the name written on the agreement originally as the purchaser was that of the plaintiff. The name was changed to that of the deceased.

52. Accordingly, I find that what happened here is consistent with the plaintiff's case. It is probably not consistent with the defendant's case. On the defendant's version, there was never any question of the plaintiff being the purchaser. The defendant's case is that a mistake was made. But why should anyone write the plaintiff's name in the agreement if there was never any question of him being the purchaser? And if such a mistake was made, why was it not simply amended with a stroke of the pen, as was the address? The evidence is that it is probable that an attempt was made to conceal the fact that the plaintiff's name had appeared on the agreement. The probability is that this was done by someone in the deceased's camp, and it was done because it was realised that this was important evidence leading to the belief that the plaintiff had purchased the property. It is common cause that, at all relevant times, the agreement was in the possession of the deceased and his widow. For the same reason, the defendant has omitted to say whose name was originally on the agreement. Clearly, the defendant knew whose name was first written on the agreement, but says only that it was seen that a mistake had been made without describing the nature of this mistake.

Who Paid the First Three Instalments?

53. The plaintiff says that he paid these. He says he paid the first instalment to Mr Lee in cash. There is no contemporaneous document that supports this. He says he paid the second and third instalments by personal cheques to the developer. There is no doubt that this is so. The plaintiff's bank account shows debits of $6,300 on 1 August 1960 and 11 October 1960 and the paid cheques have been produced. It is probable that, having paid these instalments, he also paid the first instalment.

54. The deceased says that he paid these instalments. He says that the source of the payments were funded by drawings has made by him on the partnership. He says the four payments were made by four cheques issued by the partnership and drawn on the partnership's bank account. This is obviously wrong. What the widow says is also obviously wrong; that, after the payments had been made, the plaintiff told the deceased that he had paid the second and third instalments personally because there was insufficient money in the partnership account. If the deceased had been told this, he would not have believed that the cheques were issued by the partnership. The deceased knew that the plaintiff had paid with his personal cheques. The payments were made through him, and the receipts were issued to him.

55. The weight of the evidence on this point dictates a finding that it was the plaintiff who paid the first three instalments of the purchase price on his own behalf.

Who Paid the Final Instalment?

56. The contemporary documents show a payment from the plaintiff's bank account of $40,000 on 3 August 1960 by cash cheque, a payment into the account of $40,000 on 17 January 1961 and a payment out of $34,000 on 7 February 1961.

57. The deceased's bank documents show a payment into the account of $40,000 on 31 October 1960, a payment out of $40,000 on 17 January 1961 to the plaintiff, a payment in of $34,000 on 6 February, another of $10,000 on 7 February 1961 and a payment out of $44,100 on 7 February 1961.

58. On 24 January 1961, the developer demanded payment of the final instalment and, on 4 February 1961, issued a reminder.

59. The plaintiff says that the payment of $40,000 on 3 August 1960 was a loan to Mr Lee Nam, which he repaid on about 31 October, and which the plaintiff paid directly to the deceased towards payment of the final instalment. It appeared that this sum was not needed immediately, so the plaintiff asked for its return. The deceased repaid it on 17 January 1961. Shortly afterwards, it was needed, so the plaintiff paid to the deceased $34,000 by cheque and $10,100 in cash to make up the $44,100 that the deceased paid out on 7 February 1961.

60. The defendant's case, according to the widow, is that the payment of $40,000 on 17 January 1961 was a loan to the plaintiff. She does not mention the payment in of $40,000 on 31 October 1960. The payment in of $34,000 was a partial repayment of this loan.

61. It is true that, in his written statement, the plaintiff does not mention the loan of $40,000 to Mr Lee Nam, but, by the same measure, the deceased does not mention of the loan of $40,000 to the plaintiff. There is nothing to be made of this. Whatever the truth, at the stage of the proceedings concerned, it may not have seemed relevant. There is also nothing to be made of the apparent coincidence of the amount of the loan to Mr Lee Nam being similar to the amount of the final instalment. At the time, he was also buying a similar property, and he might have needed this similar amount for similar purposes.

62. What is odd is that the plaintiff should have requested a loan of $40,000 from the deceased. According to the defendant's case, at about this time, the plaintiff was drawing pretty well what he liked from the partnership. In that situation, if it was so, why would he need to borrow money from the deceased? There is also no mention in the defendant's case of the plaintiff repaying the balance of the alleged of $6,000.

63. It is probable that, if the plaintiff paid the first three instalments, he also paid the final instalment. Any other factual situation does not make sense.

64. I find that, on the probabilities, the plaintiff paid this final instalment.

Occupation of the Property

65. On the defendant's own case, the plaintiff occupied the deceased's property for some thirty years without paying anything to the deceased for this considerable benefit. This is by far the strongest evidence against the acceptance of the defendant's case.

66. In the ordinary course of events, if the deceased had purchased this property as a home for his new bride, one would have expected he and his wife to occupy it. But this is not what happened. What happened, the defendant says, was that, having expended what was, in those days, a very large sum of money on buying the property, the deceased allows the plaintiff and his family to occupy it. And not to occupy it for a temporary period, until the plaintiff made other arrangements, as had been agreed, but for some thirty years. And for thirty years without the plaintiff paying one cent to the deceased to compensate him for the expenditure of a large amount of money on acquiring the property. This, of course, was not just a matter of the deceased having no return for his investment, but involved him in expense in renting other premises for the matrimonial home, expense to which the plaintiff did not, on the evidence, contribute. Then we have the situation in which, after some twelve years of not occupying what the defendant says was the deceased's own property and not receiving any income to compensate, the widow purchases another property for an even greater expenditure of $190,000, for which she incurs the heavy burden of a mortgage of $100,000, in order to provide themselves with a home.

67. Given the extreme of generosity that one might expect from a person in the deceased's position, this story by the defendant is simply incredible. At the very least, one might have expected, perhaps, the mild inquiry, now and again, over the thirty years, as whether or not the plaintiff thought that it was, perhaps, time that he acquired his own property so that the deceased could occupy the property that was rightfully his. Or, maybe, the suggestion, politely phrased, that the plaintiff might give consideration to paying some rent for the property that belonged to the deceased and that the plaintiff had occupied for so long free of any payment to the deceased. Nothing like this happened.

68. I do not accept that, if the deceased ever believed that the property was his beneficially, he would have behaved in this way. This story is lot more that improbable. It is totally unbelievable.

69. On the other side of the coin, the plaintiff did sit quietly, without demanding that the property be assigned to him. This may be thought to be strange. But the plaintiff had occupation of the property; he was not paying any rent, and, on the defendant's own version, the deceased did not, until very late in the day, make any suggestion that the property did not belong to the plaintiff. There was no reason for the plaintiff to be anxious about the situation. Unlike, the deceased, if the defendant's story is to be believed, the plaintiff was not suffering any prejudice. Any improbability that a beneficial owner would act in this way is totally overwhelmed by the defendant's incredible version.

Possession of the Deeds

70. The plaintiff says he had possession of the deeds until 1986, although the deceased kept possession of the provisional agreement of sale and other documents. It does seem likely that the deeds were used to obtain the property tax exemption in 1967. Mr Philip Shing says that he saw the deeds in the secret drawer in about 1981. He says this in spite of the fact that, according to the widow, at all material times, the deeds were in a deposit box opened in their names and rented from a bank. Mr Pow handed up from the Bar an agreement dated 9 May 1983 with Hang Seng Bank under which the deceased and the widow rented a deposit box. The suggestion here is that the widow is wrong in her evidence; that the deeds were kept in the deposit box only after 9 May 1983, so Philip could have seen them in the secret drawer in 1981. I do not think the agreement shows that the deceased did not have a deposit box before 9 May 1983. His banker earlier had been the Shanghai Commercial Bank with whom he may have had a deposit box.

71. I am not happy with Mr Philip Shing's evidence about finding the deeds in the secret drawer. It does not have a ring of truth about it. He says that, as a boy of 12 to 14 years of age, he finds an envelope in a secret drawer. He thinks the envelope is his. That does not ring true. He says he kept currency notes in the drawer; why should he think that an envelope was his? He opens it. He realises that it is not his. Nevertheless, he peruses what, for a boy of that age, could not have had the appearance of anything interesting. Even for a mature adult, the deed is boring. He says he saw the address of what he thought was his uncle's property. To get this information must have involved reading a great deal of turgid legalese. I do not believe that he did this. It is improbable that a boy of that age would do such a thing. He says that he then questioned his parents about the document. This seems most unlikely. The natural reaction of a boy of that age, upon finding a boring legal document in such a place, would be to return it to its place and forget about it. All this strikes me as a late invention to bolster the defendant's case.

72. I cannot come to any definitive finding on the question of who held the deeds. The evidence, in my view, favours neither party.

The Meetings

73. The deceased does not mention the meetings at which, the defendant says, the plaintiff, by implication, admitted the deceased's beneficial ownership of the property. When the deceased made his affirmation, the case had not advanced very far, but it is clear from what he said in that affirmation that he knew the nature of the primary issue; whether or not he held the property in trust for the plaintiff. In that context, it is strange that he did not think to mention important evidence that went to the very root of this dispute - that, on two separate occasions, in the presence of witnesses, the plaintiff clearly admitted that the deceased was the beneficial owner.

74. In her statement made in October 1996, the widow described only the meeting in late 1990 at the property. In her affirmation of 26 September 1997, she mentions the second meeting in the restaurant. There is no explanation as to why she did not mention the meeting at the restaurant in her first statement. This statement was made at an advanced stage of the proceedings. The defendant's case was being prepared for trial. She must have been questioned about the first meeting in some detail. It must have been clear to her that evidence that the plaintiff admitted that he had no beneficial ownership in the property was important. Yet she fails to mention the second meeting. It is not likely that a witness would remember one meeting, and forget about another later meeting on the same important subject matter.

75. Mr Philip Shing mentions both meetings. It is only after he has done so in a written statement that the widow talks about the second meeting. It must have been obvious then that she had not mentioned this earlier, but no explanation is advanced for this.

76. But the unsatisfactory nature of this evidence goes deeper than this. According to the defendant's case, in late 1990, the plaintiff had been occupying the deceased's property free of any charge for some thirty years. The deceased makes the perfectly reasonable decision to sell the property. The plaintiff indicates that he is unwilling to respect this decision; he wants to continue to occupy the property without paying anything to the deceased. Clearly, the deceased cannot have believed he had any realistic chance of selling the property with the plaintiff in occupation, but he does nothing about getting rid of this encumbrance. Instead, two years later, it is the plaintiff who takes action, claiming that he is the beneficial owner. Even then the deceased does not take any action to recover the property to which he says he is entitled. He was, apparently, content to allow the plaintiff to proceed at his own leisurely pace. This does not ring true. In this situation, one would have expected the deceased to take vigorous, immediate and indignant steps to recover his property from this grossly ungrateful man. I know, of course, that the deceased was a sick man, but I would have expected that, in this situation, a great desire in the deceased to get the matter settled before he died. This is especially so when the churlish plaintiff, in July 1993, commenced other proceedings against the deceased claiming that he had acted fraudulently.

The Legal Point

77. Mr Pow takes a legal point. He argues that the plaintiff is seeking equitable relief and he is entitled to this, even on his own case, only if he comes to court with clean hands. Mr Pow submits that the plaintiff arranged to have the property assigned to the deceased in order to defeat his wife's claim in the divorce proceedings. The evidence is that the plaintiff was married to his wife for only about one month when she committed adultery; an allegation on which the plaintiff obtained his divorce. Not surprisingly, the wife made no claim for maintenance or for a property settlement. It is unlikely that she would have been entitled to any such relief. In these circumstances, I do not think it can be said that the plaintiff acted in such a way as would disentitle him to equitable relief if his claim is otherwise good. Clearly, the defendant did not think so either until Mr Pow thought of the point late in the day. There is no allegation in the defendant's case upon which this point could be based.

Conclusion

78. On the evidence, particularly the probabilities, I find that the plaintiff has established satisfactory proof of his case, and that he is entitled to a declaration that he is the beneficial owner of the property, and to an order that the defendant assign the property to him. I so order.

79. The defendant's counterclaim is dismissed.

Costs

80. There has been no argument on costs, but I can see no obvious reason why costs should not follow the events. I make an order nisi that that the defendant pay the plaintiff's costs of the claim and the counterclaim.

Representation:

Mr Nelson Miu, instructed by Messrs Liu, Choi & Chan, for the plaintiff.

Mr Jason Pow, instructed by Messrs Fairbairn, Catley, Low & Kong, for the defendant.