Lee Siu Mui v. Stewart & Co (A Firm)

HCA000669/1967

IN THE SUPREME COURT OF HONG KONG

ORIGINAL JURISDICTION

ACTION NO. 669 OF 1967.

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Coram: Briggs, J.

Date of Judgment: 22 March 1968

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JUDGMENT

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1. The history of this action goes back to 1962. In that year the plaintiff, Lee Siu Mui, was the tenant of a flat on the third floor No. 25 Tin Hau Temple Road. Her Landlord was one Iu Wing Sum.

2. In O.J. Action No. 591 of 1962 Iu Wing Sum sought the recovery of possession of this flat together with one month's arrears of rent, amounting to $500.

3. On July 31st 1962 a settlement in that action was recorded in court. The plaintiff in the present action, Lee Siu Mui, agreed to give vacant possession to Iu Wing Sum and to pay him mesne profits at the rate of $500 per month from the date of the settlement until such vacant possession was delivered.

4. On March 18th 1963 the plaintiff in the present action was convicted by the Magistrates Court at Causeway Bay of two offences namely assault occasioning actual bodily harm and of an offence contrary to section 2 of the Criminal Intimidation Ordinance. The victim in each case was Iu Wing Sum.

5. In May 1963 a writ of execution was issued against the plaintiff to recover possession of the 3rd floor flat at 25 Tin Hau Temple Road, the subject matter of O.J. Action 591 of 1962.

6. At about the same time the plaintiff consulted the defendants, a firm of solicitors, as to her recent conviction. It was decided to invite the Magistrate to review the proceedings but this was unsuccessful. So it was decided to lodge an appeal. This was done on May 14th 1963. The appeal was against both conviction and sentence, though later, on counsel's advice, the appeal against sentence was abandoned.

7. On May 16th 1963 the plaintiff was granted a stay of execution in O.J. Action 591 of 1962 for a limited period of time on condition that $16,000 was paid into court. She paid this sum to her solicitors, the defendants, who paid it into court. So by this date the defendants were acting for the plaintiff both in the criminal appeal and also in the civil proceedings.

8. Mr. Bernacchi, Q.C., and Mr. Suffiad were briefed for the criminal appeal which was eventually dismissed in April 24th 1964. Mr. Bernacchi and Mr. Stevenson, the senior partner of the defendant firm, both gave evidence before me and said that several conferences were held with the plaintiff in relation to the appeal. In particular an application was made to call fresh evidence at the appeal and it became necessary for the plaintiff to swear an affidavit in support. This was prepared in consultation with Mr. Bernacchi, the plaintiff being present. Mr. Bernacchi also informed the court that the plaintiff was present in court for at least part of the hearing of the appeal. And that he was sure that she realised that the criminal appeal was not part of the O.J. action in which of course a settlement had already been made. That action was never in fact tried.

9. Mr. Bernacchi was also retained by the defendants on behalf of the plaintiff in regard to the O.J. Action 591 of 1962. He said the plaintiff was very anxious to have the settlement set aside or to have it stayed for a further period of time. Mr. Bernacchi told the court that he warned the plaintiff that her chances of success were very slim since she would have to rely on a certain document which had been given in evidence in the criminal proceedings. This document purported to be an agreement made between Iu Wing Sum, the plaintiff's landlord, and herself and in the criminal proceedings the court had held that the signature of the landlord thereon had been obtained by the threats and intimidation of the plaintiff and that it was of no legal effect. In fact it was for this that the plaintiff was convicted on the charge laid under the Criminal Intimidation Ordinance.

10. However, there was a further stay of execution, Mr. Hu of counsel being briefed by the defendants on behalf of the plaintiff. And by consent of the parties on June 29th 1963 it was ordered that execution be stayed "until further order".

11. Mr. Stevenson in his evidence said that the plaintiff was most anxious not to give up possession of the flat and she confessed this in her own evidence before me. However, the parties still continued to negotiate with one another in order to secure a final settlement.

12. One of the many documents put before the court during the trial was an offer of settlement made by Messrs. Philip K.H. Wong & Co., the solicitors of the landlord, to the defendants, the solicitors of the plaintiff, dated June 10th 1965.

13. The terms proposed were that the plaintiff should vacate the premises by August 15th 1965, should be paid back the $16,000 then in court and receive in addition $7,000. Each party was to bear its own costs. The terms of this offer were open for seven days. I will return to the terms of this proposed settlement later in this Judgment. It is enough to say that these terms were not accepted by the plaintiff.

14. The building, of which the flat occupied by the plaintiff formed part, was mortgaged to the Hong Kong Chinese Bank. They foreclosed and in October 1965 entered into possession thus becoming the new landlord of the plaintiff. This of course vastly affected the position as between the plaintiff and her former landlord, Iu Wing Sum. He no longer required possession of the premises, but he did want his mesne profits. The $16,000 of the plaintiff still remained in court. Iu Wing Sum therefore pressed for a settlement. I was told that at that time that the mesne profits amounted to $21,000. During negotiations between the parties it was suggested that $8,000 should be paid to each party but eventually the defendants were able to secure better terms for the plaintiff. And finally it was agreed that the plaintiff in the present action should receive $11,000 and Iu Wing Sum should receive $5,000. Each party to pay their own costs.

15. The terms of this settlement were made an order of court on May 7th 1966.

16. In accordance with the terms of the settlement the defendants withdrew $11,000 from the court and paid it into the plaintiff's client's account. At that time the plaintiff owed the defendants a considerable sum of money for costs including counsel's fees incurred on her behalf both in the criminal appeal and in the O.J. action and $11,000 was credited to her account. The defendants have counterclaimed for the balance of that account, $3,273.

17. As I have said above the final settlement was made an order of court on May 7th 1966 and it is of this settlement that the plaintiff complains. She complains under three heads:-

18. Before me the plaintiff conducted her case in person and gave evidence on her own behalf. She also called her son, Gordon Chan, a boy of 15, as a witness. This matter has dragged on since 1962. And I have heard evidence, which I accept, to the effect that during this period the attitude and behaviour of the plaintiff so far as this matter is concerned has become steadily more and more irresponsible. The plaintiff appears to be suffering from the delusion that there is a vast conspiracy against her. She has evinced a fixed determination to retain possession of the flat whatever happens. No one connected with the case has escaped her unbridled tongue and in particular Mr. Stevenson and his wife have been subjected to insults and annoyance on more than one occasion both at their home and in his chambers. Both Mr. Bernacchi and Mr. Stevenson have had occasion to call the police to prevent the hysterical behaviour of the plaintiff from getting out of hand.

19. In court she was hysterical and abusive - sparing no one. It was patently obvious that she is utterly incapable of regarding anything connected with this case objectively. She disregarded any evidence whether in writing or not which she considered was not in her favour. In particular she first refused to admit that she had been convicted and had appealed against that conviction though she herself signed the notice of appeal, the notice of the abandonment of her appeal against sentence, and at least two affidavits in support of the appeal. Later she admitted the conviction, the appeal and its result. Where she thought it suited her to do so, she denied receiving letters from the defendants prior to the settlement of May 1966: and she also denied sending several letters written by her or on her behalf which were received by the defendants. There is also at least one piece of evidence which she has fabricated.

20. I considered her a stranger to the truth and I do not accept any of her evidence save where it is corroborated by other evidence.

21. As I have said the plaintiff complained that she was not informed of the settlement of May 1966 beforehand.

22. Mr. Stevenson said that he received an offer of a settlement from the plaintiff in O.J. Action 591 in early April, 1966. The offer was expressed to be a final offer. There had been previous offers in 1965, but no settlement was reached because of the attitude of the plaintiff. On April 13th 1966 Mr. Stevenson received a letter from the plaintiff which was dated April 1st in which she mentions that she was awaiting news of a settlement. He replied by letter setting out the terms of the settlement which he had recently received, explaining them and advising their acceptance. No answer was sent to this letter and the plaintiff denied ever receiving it. Evidence was given of its despatch and posting and it was not returned through the post. I am satisfied that this letter was received by the plaintiff who elected to ignore it for her own purposes. Mr. Stevenson also said that Mr. Tze of his office made an appointment with her to come to the office to discuss the settlement on April 26th 1966 at 4 p.m. She rang up Mr. Stevenson herself and changed the date of the appointment to April 27th. She did not keep that appointment. And though further efforts were made to contact her they were unsuccessful. In court she admitted the appointment and said she had not kept it because of the behaviour of Mr. Stevenson.

23. Because the other side were pressing hard Mr. Stevenson consulted Mr. Bernacchi who advised a settlement in the terms suggested. Mr. Bernacchi said he took full responsibility for this as he considered it was in the best interests of his client. Counsel of course has full authority to settle a case on behalf of his client if it is in the best interests of that client to do so and provided that he has not received any instructions not to settle.

24. I am satisfied and hold as a fact that the plaintiff was fully aware of the terms of the final settlement before it was made.

25. The second complaint of the plaintiff is that the settlement of May 1966 was not to her advantage. And she has compared it very unfavourably with the proposed terms of a settlement made to the plaintiff's solicitors on behalf of the other side by Messrs. Philip K.H. Wong & Co. in 1965. Two versions of the proposed terms are before the court; one in a letter dated March 2nd from the defendants which is admitted by the plaintiff; the other in a letter from Messrs. Wong dated June 10th which was not admitted by the plaintiff. That is, she admitted receipt of the former letter but not the latter. The latter is slightly less favourable to the plaintiff.

26. The suggested terms of the 1965 settlement are not comparable in any way with the terms finally accepted in 1966. In 1965 the plaintiff in O.J. Action 591 of 1962 was still the landlord of the plaintiff and one term of the suggested settlement was that the plaintiff in this action should give up vacant possession of the flat, and in order to achieve this very generous terms were offered to her. By 1966 the plaintiff in O.J. Action 591 of 1962 had ceased to be her landlord; the question of vacant possession was not in issue between the parties. The only question at issue was the amount of mesne profits.

27. I accept Mr. Stevenson's evidence that the plaintiff refused the terms of the 1965 offers. And this is not surprising because she was anxious not to have to vacate the premises. She told the court that she had never received the terms of the suggested settlement of June 10th 1965. This I do not believe. I find that they were sent to her by the defendants being enclosed in a letter from them dated June 14th 1965, a copy of which was exhibited in court.

28. It is my view that the settlement of 1966 was obviously greatly to the advantage of the plaintiff. She owed the other side $21,000. If she had fought the case she would have had judgment against her for that amount together with costs. Under the settlement she only had to pay $5,000, the balance of the $16,000 still in court being returned to her. And she had to pay no costs of the other party. This is a settlement which it would have been madness not to accept in the circumstances. And I think counsel was absolutely right in the advice he gave.

29. The third complaint of the plaintiff is that she never wanted a settlement of O.J. Action 591 of 1962 in any circumstances. In her usual extravagant language she said she would not even have settled the case for $200,000. She produced as evidence of this a letter dated March 5th 1965 addressed by her to Mr. Stevenson. This contains the following words:

"Meanwhile please be informed that in connexion with this action any decision made and/or terms offered to the plaintiff on my behalf by you without any prior approval in writing personally signed by me, should be considered null and void."

The letter is signed by the plaintiff. The action referred to is of course O.J. Action 591 of 1962.

30. Mr. Stevenson stated that he saw this letter for the first time when it was produced before me at the trial and that he had never received it. He put his firm's incoming mail book in evidence which does not record that any letter came from the plaintiff during the relevant period. The plaintiff did not include this document in her affidavit of documents. Nor was it produced at the meeting of the plaintiff with Mr. Gregory, [a partner in the firm of solicitors appearing for the defendant], in September 1967, which was arranged in an attempt to agree a bundle of documents for the purposes of this case. Mr. Gregory in the witness box said the first time he had seen it was when the plaintiff produced it in court during the trial. The plaintiff said she had tried to show it to Mr. Gregory at the meeting referred to above but I do not believe that that is so. This is the piece of evidence which I believe to have been fabricated by the plaintiff and to which I have referred above. I do not believe that the plaintiff gave instructions that there was to be no settlement. Indeed her letter to the defendant of April 1st 1966 which I have mentioned above states that the plaintiff has been patiently waiting for the settlement of the action for 3 years. Settlements are also referred to by the plaintiff in letters which she denies having sent but which I am satisfied were sent to the defendants on her behalf dated 21st February 1964 and 4th June 1965.

31. To sum up so far therefore I find that the plaintiff knew of the terms of the settlement of May 1966 before it was actually made an order of the court; that that settlement was very much in her favour and that she never gave instructions that the case was not to be settled.

32. The plaintiff also complains that the bill of costs submitted to her by the defendants was unreasonable. She was informed by the defendants in writing more than once of her right to have their bill of costs taxed. She has not sought to avail herself of that right. And I do not think she can now complain of this matter in the present action.

33. In the reply and defence to the counterclaim the plaintiff complains that the defendant obtained an order for the payment out of court of $11,000 without her consent and knowledge. This sum was credited to the account of the plaintiff with the defendants. This the defendants are entitled to do by virtue of the provisions of the Solicitors Accounts Rules (see rules 7(a)(iv) and 12). I find that the defendants followed the accepted and a correct practice when they showed the credit of $11,000 in their bill of costs which was submitted to the plaintiff.

34. There is a counterclaim by the defendants for the sum of $3,273 which is the balance of the bill of costs owed to the defendants. I do not see how this can be opposed by the plaintiff and indeed she has given us direct evidence on this point.

35. The plaintiff's claim is dismissed. There will be judgment on the counterclaim for the defendants for $3,273. The defendants are to have their costs of the action and of the counterclaim.

36. I cannot leave this case without remarking that in my considered view the defendants and also counsel briefed by them on the plaintiff's behalf have acted throughout the whole of their dealings with the plaintiff in accordance with the highest tradition of the profession. And I can see no grounds whatever for any adverse criticism of their conduct in this matter.

22 MAR 1968

Representation:

Plaintiff in person.

Mr. de Basto (Johnson, Stokes & Master) for Defendant.