Mirador Investment Co Ltd v. Tan Chong Keng

HCA010624/1983

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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BETWEEN

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Coram: Hon. Mantell, J.

Date of Hearing: 17th October 1984

Date of delivery judgement: 17th October 1984

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JUDGMENT

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1. In about June 1981 the plaintiff company Lent to the defendant HK$490,000. In 1982 $190,000 was repaid. The Plaintiff's case is that the balance has never been repaid, that is, some HK$300,000. The evidence called in support of the plaintiff's claim is short (Mrs. Kaplan would say "stark") because all that Mr. Ma, who is the General Manager of the plaintiff, has been able to say is that: "We have no record of that money ever being paid back to us and, indeed, so far as I know it never has been." I interpose to say that I found in everything he said, Mr. Ma, to be a very calm and impressive witness, and I accept that he has made every endeavour to tell me the truth. Although at one time Mr. Mullick for the plaintiff argued to the contrary and, so far as I know, still believes his submission is right, it is for the plaintiff to establish on a balance of probabilities that his claim for the balance of this debt is made out. Such would have been the case if the defendant had not appeared at the hearing of the action. It would have been for the plaintiff on the pleadings as they stood to prove not only the making of the loan, if not admitted on the pleadings, but also the fact that repayment had not been made, and it would only be upon that being shown, on a balance of probabilities that the plaintiff would have been entitled to judgment. The defendant, by his Defence supported by evidence in the witness box, has said: "Well, yes, there was this loan. I paid back, as the plaintiff admits, HK$190,000 or its Singapore dollar equivalent in 1982, and I also paid back the balance of HK$300,000 in its Singapore dollar equivalent on the 9th March 1983 when I visited Mr. Choi, who was Managing Director of an associated company to that of the plaintiff in Singapore and also a director of the plaintiff, and handed him that sum in cash in discharge of my indebtedness. What is more, one of my sons happened along as this very transaction was taking place and saw it taking place. It is true that I have no receipt for the payment. It is true that I have not, at any rate, I have not been able to produce, nor have I disclosed on discovery any document remotely connected with that transaction, either as to the source of the money, which came out of funds supplied by my son in order to allow me to take a party to Hong Kong and China, or from the records of the associated company in Singapore though it would be very unlikely that the company would have any record as I was simply repaying a debt to the plaintiff company in Hong Kong, and it was my understanding, as a result of what Mr. Choi told me, before I repaid the debt that the whole of that sum was to be remitted to Hong Kong."

2. Mr. Choi has not been evident during these proceedings. At some date towards the end of March he found it convenient to leave Singapore. I was told, I do not think it is disputed between the parties, that he faced some proceedings in the Courts in Singapore and was on bail; that he came to Hong Kong is not disputed either because he was seen on the 30th March both by the defendant and Mr. Ma. He was one of a party who had dinner at the Fortuna Restaurant. But soon after that everybody seems to have lost Mr. Choi, or he has made himself absent, and certainly I have not been offered any explanation as to why he has not been here except that it has not been possible to trace him.

If the defendant's evidence had been credible, supported as it is by that of his son, but not by any document or any other kind of extraneous evidence, then I think the plaintiff must have failed in his claim because I would not have been able to say, on a balance of probabilites, which is the burden to be discharged here, that the plaintiff had proved that the debt had not been repaid. I am sorry to have to record that, in my view formed during the course of the evidence which has been given to me just today, I do not find the defendant's evidence credible nor, with regard to the material matter in issue, that of his son either. Now, as Mrs. Kaplan reminds me, that is a very large responsibility for a judge to undertake, but I am afraid it is a responsibility which judges have to undertake day by day and there is no shirking it. It does not mean that I find that their evidence is untrue in every respect, by no means, but with regard to the material matters in issue between the parties I find it not credible, not worthy of belief and certainly not evidence upon which I can rely. I ought to say a little more about why I have formed that serious judgment about the evidence which has been given before me today. In the first place, of course, one has to take account of the manner in which evidence is given and the demeanour of the witness in giving it. It is not easy to do, always made harder by the fact that evidence as in the case of the defendant himself is given through the medium of an interpreter. Not so, I may say, in the case of the son who gave his evidence in English. I was not impressed by the manner in which either of those witnesses gave their evidence. I thought with regard to the defendant himself that his explanations as to how the money came to be available for him to pay this debt in cash were not only confused, but, I thought, deliberately blurred. At one time he seemed to be saying that the money was advanced to him by the company for which his son worked and it remained outstanding. At another there was some suggestion that he managed to use money advanced to him and that he was able to get over his own difficulties by taking credit from hotels in Hong Kong. There was some suggestion of it being a surplus. Altogether the manner in which that evidence was given was singularly unimpressive. Of course he had to have some explanation as to where the money had come from, otherwise he would not be able to account for being able to hand over on the day a very substantial sum in cash. His reasons for not taking a receipt I found incredible. Here was a man experienced in business, who was handling what was, after a11, nearly HK$300,000 and not money of his own. It had net come out of his own pocket. Whether he was in the event or not, he might very well have been called upon to account for what he had done with it. Apart from that he was discharging a debt to a company of which he was a shareholder. Any man of business, whether or not he trusted the person with whom he was dealing, would have taken a receipt in those circumstances. I pay regard to everything the Mrs. Kaplan has so persuasively urged upon me about the background of the whole of this transaction; the fact that in the first place the record seems to be slight; that on the repayment of the first tranche of the debt there was no receipt taken, (although of course it has to be remembered that that payment was made by a cheque drawn on the travel agent company's bank account.) So, even at an early stage, before any major discrepancy had emerged, the defendant's evidence left me in a state of considerable unease. Then it came out, during cross-examination by Mr. Mullick, that what he had told me on his oath as to the arrangement between himself and Mr. Choy for the destination of this money was at complete variance with an account given in an affirmation during interlocutory proceedings in this action. He told me that one of the reasons why the transaction was more conveniently made in cash rather than by cheque was because it was Mr. Choy's intention disclosed to him to remit the money to Hong Kong to the plaintiff company. Why it should have been more convenient for it to be in cash was never fully explained, but had it been uncontradicted elsewhere it would have been difficult to say that that was an unbelievable arrangement. Now it appears from the affirmation to which I refer that at an earlier stage Mr. Tan was saying that far from it being Mr. Choy's disclosed intention to remit the money to Hong Kong it was his intention to apply it in part satisfaction of a debt which the plaintiff owed to its associate company in Singapore, of which Mr. Choy was Managing Director. The two versions could hardly be more different. Why should he tell what might be said to be a purposeless lie. Could it be a mere inaccuracy and therefore attributable to something other than desire to hide the truth. It certainly was my impression that Mr. Tan was attempting, without reflection, to deal with questions put to him in cross-examination as to why the transaction had to be in cash. Whether he thought of it in advance or not, that was the answer which he thought would best satisfy me, forgetting for the time being that he had given a contrary explanation earlier. The other matter which I think goes very much to the criticism of him as a witness arises out of the one real conflict of evidence that there has been here. No doubt thinking to improve his case, Mr. Tan told me that at the meeting at the Fortuna Restaurant to which I have already made reference, in Hong Kong, on the 30th March, at which Mr. Choy was present and also Mr. Ma, he and Mr. Choy discussed openly the fact that this debt had been fully discharged - a matter of some importance, I may say, because by that time Mr. Choy had resigned as director of the plaintiff company. It would have been of great interest to Mr. Ma, and I would have thought to the defendant also to make it absolutely certain that this information came into Mr. Ma's possession. It was also the day after, or a day or so after, that Mr. Choy thought fit to flee Singapore. Mr. Ma, who as I have said I found to be an impressive and truthful witness, said nothing of the sort was said. In case it was possible that it was said without him hearing it I put a question Mr. Ma myself to discover whether it could have been said without him hearing it, and rather as expected he said it was not. I accept Mr. Ma on that. These were, the two matters which have led me to say, as I say regretfully, that I cannot accept Mr. Tan's evidence about the repayment of the loan. He called, or rather there was called in his behalf, his son who gave evidence in English, who, I am afraid, impressed me no more than his father. He claims that, as was his practice, after the market closed on the very day that this loan was being repaid, he went round to Mr. Choy's office and saw the money being handed over. That in itself is a coincidence, but it does not follow that because it is a coincidence and a fortunate one from the defendant's point of view that one cannot accept that it happened, or that it probably did not happen. But Mr. Tan Junior gave an account of what he saw which did not seem to me to fit together. He said that as he came into the room he saw his father counting out the money and at that time Mr. Choy was on the telephone apparently speaking to someone of the East Asia Bank about exchange rates. When he came off the telephone Mr. Choy told his father what the equivalent in Singapore dollar was and then the transaction took place. It seems strange to me that the money should be in the process of being counted out before the exchange rate had been established, even though, of course, it is right to say that the defendant would have an approximate idea of how many Singapore dollars were needed. That in itself might not be too important. However Mr. Tan Junior, seemed to me, in the course of a number of questions, some put to him by me and some by Mrs. Kaplan, to indulge in what I have described in the course of argument as rather fast footwork, and the distinct impression that I was left with was that he was prepared to give any account to meet what he thought might be an objection to his evidence formed in my mind. Also, if I may say so, to be told in the office by his father in Mr. Choy's presence that his father was paying off the last tranche of the debt was lucky, but to be told again by Mr. Choy during their luncheon seems to me to be almost too much of a good thing. All in all, as I say, the impression given by the evidence was such that I feel I cannot place any reliance upon it in so far as it relates to the issue between the parties, namely the repayment of this HK$300,000 or its Singapore equivalent. It seems to me it leaves me in precisely the position I would have been in had no evidence been advanced on behalf of the defendant. It folows, therefore, on a balance of probabilities (it is important that the parties remember that that is all of which I have to be satisfied in a civil action), the plaintiff succeeds in proving his claim. There will be judgment for the plaintiff in the sum of HK$300,000.   There is no interest on the Loan, none will be awarded, but there will be interest on the judgment from the date of judgment until satisfaction at the rate, currently prescribed by the Chief Justice. I ought to say in the course of giving judgment that I am indebted to Counsel on both sides for their careful arguments and, although I found as I have, I do not think any more could have been done for the defendant than was done.

Representation:

John Mullick instructed by W.S. Lo & Co. for Plaintiff

Mrs. Barbara Kaplan instructed by Deacons for Defendant