The Hongkong Chinese Bank, Ltd. v. Santa Fur Co. Ltd. and Others

HCMP000266A/1999

HCMP 266/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 266 OF 1999

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Coram: Deputy High Court Judge Gill in Court

Dates of Hearing: 25-28 March 2002

Date of Judgment: 19 April 2002

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J U D G M E N T

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1.This is a claim for moneys due and payable under a mortgage and for an order for possession of the mortgaged property. It concerns the 4th defendant only.

Background

2.The 3rd and 4th defendants are husband and wife. They are the registered proprietors and occupiers of a residential unit in a development called Richland Gardens, situated in Kowloon Bay. They purchased the apartment (which I shall call hereafter "Richland Gardens") shortly after their marriage in 1984. It was acquired for the purpose of providing a family home under the Home Ownership Scheme (HOS). The HOS provides housing for couples or family groups whose resources would otherwise make it difficult for them to buy their own home. Those who qualify and who wish to participate ballot for available units and, if successful, pay well below the market value. But the downside is that they may not resell or recharge for some time after the purchase unless they pay a premium to the Housing Authority (HA) which administers the HOS. They paid about $250,000.00 for Richland Gardens. They raised $200,000.00 from the Standard Chartered Bank (Standard Chartered) which was secured by first mortgage at an interest rate of 10.5% per annum, payable by 180 monthly instalments of about $2,200.00. The deposit of about $50,000.00 was raised from their families.

3.The plaintiff is incorporated in Hong Kong and licenced to carry on business as a bank. In April 1997 one of its customers was the 1st defendant. The 1st defendant sought from the plaintiff enhanced credit facilities. The upshot of that was that on 25 April the plaintiff wrote to the 1st defendant (for the attention of the 5th defendant, one of the directors) offering credit facilities to a limit of $11,000,000.00. The plaintiff required security, inter alia, in the shape of first mortgages over various properties of which Richland Gardens was one. The 1st defendant and all interested parties were invited to sign and confirm acceptance. The 3rd and 4th defendants did so. The proposed exercise called for repayment and release of the Standard Chartered mortgage and execution and registration of a first mortgage in favour of the plaintiff. This required an application to the HA for the removal of the alienation restrictions. The HA assessed the worth of Richland Gardens at $2,030,000.00 and, by letter of 13 May, gave notice to the 3rd and 4th defendants that the restrictions would be lifted upon payment of a premium assessed at $279,589.00. This was duly paid; the receipt that issued was dated 29 May; on the same date, the HA certified removal of the restrictions. The 3rd and 4th defendants executed a mortgage in favour of the plaintiff. That was dated 5 June and was registered against the title to Richland Gardens on 19 July.

4.All other security documents having been completed in terms of the agreement to lend the 1st defendant was permitted to draw down on the accommodation granted to it. This included the amount needed to clear the Standard Chartered mortgage as at 6 June 1999 of $66,994.64.

5.But there was to be default. The plaintiff demanded a settlement from all parties, by letters of 5 January 1999. When that failed to materialize it filed, in the same month, an originating summons under Order 88 RHC demanding from the parties all moneys due and, inter alia, as against the 3rd and 4th defendants, an order for possession of Richland Gardens. The 4th and 6th defendants (the 6th being the 5th's wife, and also a director of the 1st) were the only defendants to take steps and resist the claims. The 6th defendant's defence failed and all orders sought came to be granted, save for the claim against the 4th defendant and possession of Richland Gardens. The 4th defendant applied for the proceedings (to the extent they concerned her) to be continued as if by writ. An order by consent was made in June 1999, with consequential directions for the filing of pleadings.

The Proceedings

6.The statement of claim was filed on 1 February 2000. It recited the terms of the mortgage over Richland Gardens, executed by the 1st defendant as borrower and the 3rd and 4th defendants as mortgagors; in particular, the covenant requiring all or any of them to repay to the plaintiff all the indebtedness of the 1st defendant, and the right for the plaintiff on default to enter into and take possession of Richland Gardens. It recorded that, as at 10 February 1999, indebtedness stood at HK$9,175,635.00 and US$819,332.00 with interest accruing thereafter. The prayers against the 4th defendant included payment of these amounts and an order for possession of Richland Gardens.

7.The defence was filed on 22 February. The 4th defendant claimed she signed the mortgage under undue influence. She also pleaded misrepresentation of her husband, he having told that her maximum liability was to be $200,000.00. In the alternative, she said the mortgage was manifestly unfair in that she did not derive any benefit from the transaction. The plaintiff had constructive notice of the undue influence yet took no steps to remedy this wrong, entitling her to have its mortgage set aside. She counterclaimed for a declaration that the mortgage be declared void as against her, or that her liability be limited to $200,000.00, or that it be limited to her equity of redemption.

8.The plaintiff in its reply denied that the 4th defendant was the victim of undue influence, misrepresentation or unfairness. The contents of the mortgage including that it contained an "all moneys liability" were explained prior to execution, and her signature to the document reflected her willingness to be bound by its terms.

The Law

9.A person who has been induced to enter into a transaction by the undue influence of another is entitled to set that transaction aside as against that other. Such undue influence may be actual or presumed. Undue influence is presumed if the complainant establishes that there existed between the parties a relationship under which the complainant generally reposed trust and confidence in the other. In such cases the complainant will succeed in setting aside the impugned transaction without having to prove actual undue influence; per Lord Browne-Wilkinson, in Barclay's Bank PLC v. O' Brian v. Another [1994] 1 AC 180, at page 189.

10.Where the relationship is one of husband and wife and it is the wife claiming undue influence, it is for her to demonstrate that, de facto, she left decisions on financial affairs to her husband in order to raise the presumption. Although it becomes a matter of fact as to whether in any given case there is the necessary placing of trust and confidence, the courts have over the years been more ready to find a husband has exercised undue influence; see Barclay's Bank v. O' Brian at p. 190.

11.At this point, once the presumption arises, the burden shifts to the other party to prove that the complainant entered into the impugned transaction freely, for example by showing that she had independent advice; see Barclay's Bank v. O' Brian at page 189.

12.The next question is whether, in surety cases, the complainant can set aside the transaction against the creditor. The answer is that if the creditor has notice, actual or constructive, of the undue influence exercised on the complainant (and consequentially of the wife's equity to set aside the transaction) the creditor will take subject to that equity and the complainant can set aside the transaction against the creditor as well; see Barclay's Bank v. O' Brian at page 191.

13.What amounts to notice? Lord Browne-Wilkinson said at page 195:-

"The key to the problem is to identify the circumstances in which the creditor will be taken to have had notice of the wife's equity to set aside the transaction.

The doctrine of notice lies at the heart of equity. Given that there are two innocent parties, each enjoying rights, the earlier right prevails against the later right if the acquirer of the later right knows of the earlier right (actual notice) or would have discovered it had he taken proper steps (constructive notice). In particular, if the party asserting that he takes free of the earlier rights of another knows of certain facts which put him on inquiry as to the possible existence of the rights of that other and he fails to make such inquiry or take such other steps as are reasonable to verify whether such earlier right does or does not exist, he will have constructive notice of the earlier right and take subject to it. Therefore where a wife has agreed to stand surety for her husband's debts as a result of undue influence or misrepresentation, the creditor will take subject to the wife's equity to set aside the transaction if the circumstances are such as to put the creditor on inquiry as to the circumstances in which she agreed to stand surety.

Therefore in my judgment a creditor is put on inquiry when a wife offers to stand surety for her husband's debts by the combination of two factors: (a) the transaction is on its face not to the financial advantage of the wife; and (b) there is a substantial risk in transactions of that kind that, in procuring the wife to act as surety, the husband has committed a legal or equitable wrong that entitles the wife to set aside the transaction.

If follow that unless the creditor who is put on inquiry takes reasonable steps to satisfy himself that the wife's agreement to stand surety has been properly obtained, the creditor will have constructive notice of the wife's rights.

What, then are the reasonable steps which the creditor should take to ensure that it does not have constructive notice of the wife's rights, if any? Normally the reasonable steps necessary to avoid being fixed with constructive notice consist of making inquiry of the person who may have the earlier right (i.e. the wife) to see whether such right is asserted. It is plainly impossible to require of banks and other financial institutions that they should inquire of one spouse whether he or she has been unduly influenced or misled by the other. But in my judgment the creditor, in order to avoid being fixed with constructive notice, can reasonably be expected to take steps to bring home to the wife the risk she is running by standing as surety and to advise her to take independent advice. As to past transactions, it will depend on the facts of each case whether the steps taken by the creditor satisfy this test. However for the future in my judgment a creditor will have satisfied these requirements if it insists that the wife attend a private meeting (in the absence of the husband) with a representative of the creditor at which she is told of the extent of her liability as surety, warned of the risk she is running and urged to take independent legal advice. If these steps are taking in my judgment the creditor will have taken such reasonable steps as are necessary to preclude a subsequent claim that it had constructive notice of the wife's rights. I should make it clear that I have been considering the ordinary case where the creditor knows only that the wife is to stand surety for her husband's debts. I would not exclude exceptional cases where a creditor has knowledge of further facts which render the presence of undue influence not only possible but probable. In such cases, the creditor to be safe will have to insist that the wife is separately advised."

14.An example of what might be regarded as an out of the ordinary transaction is that which gave rise to the case Credit Lyonnais Bank Nederland NV v. Burch [1997] 1 All ER 144. A junior employee agreed to support her employer's application to increase its overdraft limit from ￡250,000.00 to ￡270,000.00 by giving a second charge over the flat she owned. Its value was ￡100,000.00. The charge incorporated an unlimited all money's guarantee. The bank's solicitors wrote to her pointing out the extent of her risk and advising that she seek independent legal advice. She did not do so and in the event signed the mortgage in the presence of the bank's solicitors. When her employer went into liquidation, there was a deficit of ￡60,000.00. The bank sued for possession of the flat. At first instance, the court held that there was a relationship of trust and confidence between employer and employee giving rise to a presumption of undue influence which had not been rebutted, of which the bank had notice. The bank had not discharged its duty simply by advising the complainant to seek independent legal advice. On appeal it was held (and I quote from the headnote) as follows:-

"The transaction was so manifestly disadvantageous to the defendant, in that without knowing the extent of the liability involved she had committed herself to a liability far beyond her means and risked the loss of her home and personal bankruptcy to help a company in which she had no financial interest and of which she was only a junior employee, that the presumption of undue influence on the part of the debtor was irresistible. The bank had not taken reasonable steps to avoid being fixed with constructive notice of that undue influence, since neither the potential extent of her liability had been explained to her nor had she received independent advice. It was not sufficient for the bank's solicitors to tell her that the guarantee was unlimited both in time and amount since without being informed of the amount of the company's indebtedness to the bank or the extent of the overdraft facility being granted she was in no position to assess the significance of the guarantee being unlimited. Nor was it sufficient for the bank's solicitors to advise her to seek independent legal advice since, in the circumstances, the bank was required to ensure that she obtained independent legal advice. The bank was aware that the relationship between the debtor and the defendant was that of employer and employee and should have been aware that it was capable of developing into a relationship of trust and confidence with the attendant risk of abuse. The fact that the defendant chose not to seek independent legal advice should have alerted the bank to the possibility that the defendant was acting under the undue influence of the debtor. Accordingly, the transaction had properly been set aside. The appeal was therefore dismissed."

15.Millett LJ, after setting out the facts, said at page 152:-

"No court of equity could allow such a transaction to stand. The facts which I have recited are sufficient to entitle Miss Burch to have the transaction set aside as against the company. Every one of those facts was known to the bank when it accepted the security. The bank must accordingly be taken to have had notice of Miss Burch's equity, and must submit to the transaction being set aside against it also.

An eighteenth century Lord Chancellor would have contented himself with saying as much. It is an extreme case. The transaction was not merely to the manifest disadvantage of Miss Burch; it was one which, in the traditional phrase, 'shocks the conscience of the court'. Miss Burch committed herself to a personal liability far beyond her slender means, risking the loss of her home and personal bankruptcy, and obtained nothing in return beyond a relatively small and possibly temporary increase in the overdraft facility available to her employer, a company in which she had no financial interest. The transaction gives rise to grave suspicion. It cries aloud for an explanation."

The Issues

16.Assisted by these authoritative statements of the principles, I find the issues to be as follows:-

(a) was the particular relationship that pertained in the marriage of the 3rd and 4th defendants and the nature of the transaction that he asked her to enter into such as to raise the presumption of undue influence? If so:

(b) did the plaintiff take adequate steps to rebut the presumption and avoid being fixed with constructive notice of the 4th defendant's rights?

17.The answer lies in a determination of the facts, much of which are in dispute. It is necessary thus to review the evidence as adduced.

The Evidence

18.The 4th defendant (whom I shall call from hereon Madam Yiu) said she had a modest upbringing. She left school after her primary years and began working as a garment factory worker. She has no ability to read or write English beyond recognising her own name and one or two simple words. The 3rd defendant (whom I shall call Mr Ma) achieved a higher level of education and is more competent in English. All along he has been a tailor in fur coats and related garments. At first he undertook this activity in Hong Kong but relocated across the border and ever since has engaged in contract work from a factory there. After their marriage in 1984 they applied for the right to buy Richland Gardens and won the ballot to do so. They had to raise the deposit from the families because they had no savings of their own. The mortgage instalments were drawn on Madam Yiu's savings account with Standard Chartered into which her income was paid supplemented, somewhat irregularly, by Mr Ma's. Two children came to be born in 1985 and 1989. Madam Yiu gave up work for a short time but resumed in 1991 because her husband's contribution was spasmodic and uncertain.

19.Mr Ma's location on the Mainland has forced him to remain separate from his family for most of the time. But he does visit when he can, usually when making delivery of his garments to customers in Hong Kong. On one such occasion, in April 1997, he said he was in need of capital and proposed that they took advantage of a buoyant market and sell Richland Gardens. She responded 'If we sell the flat, where shall we live?' Faced with this reaction, he then proposed re-mortgaging. He said he needed $200,000.00. When she expressed concern about the size of the instalments, he said he would take care of them. But she was still worried and said so, whereupon he became angry and scolded her. Then, feeling helpless, she decided she had no alternative but to agree to cooperate.

20.He took her to premises in Guardforce Centre, which later she came to know were the offices of the 1st defendant. There she met, for the first time, the 5th defendant. She signed a document that was put before her. It was the plaintiff's offer of 25 April. Taken to it in the witness box, she said she did not read it before signing because she could not. She was not told what its contents were. She was not a customer of the plaintiff and had had no previous dealings with it. She did not know and had never heard of a bank officer employed by the plaintiff called Dominic Mak.

21.Shown various letters and a receipt from the HA dated May 1997, she said she recalled letters from the HA but could not read them and did not know what was written. She gave them to her husband. She did not see them again until the proceedings. She did not know that they related to the removal of the restriction of alienation of Richland Gardens or that there was a receipt included for payment of the premium of $279,589.00. She did not pay this and had no idea how such a large sum was raised.

22.The next event that took place was the signing of the mortgage deed. She was told by her husband to take a 1/2 day's leave and he took her to the offices of K B Chau & Co., solicitors (K B Chau). She had not been there before; indeed it was only her second visit to the offices of solicitors, the first being when they signed up to buy Richland Gardens. She did not know any partner or staff member. Before this visit there had been no contact by telephone or otherwise. She and her husband were attended by a staff member whose name she can no longer recall. There was small talk whilst they waited. Then some documents were brought in. She was directed to sign her name in a designated place. She was not invited to read the document which was in English and thus beyond her comprehension. She was not taken through it. She was told : "This is about your flat, do you understand?" She said she did. Then her husband signed. Then they left. From that time on the Standard Chartered debits against her savings account stopped. But there was no other benefit either to her or, as far as she was aware, her husband.

23.The next development was a letter of demand for more than $15,000,000.00 and a threat of foreclosure, followed by these proceedings.

24.Ronald Poon said he is a partner of K B Chau. In that capacity he undertakes conveyancing from time to time for the plaintiff. May Leung (Miss Leung) is a conveyancing clerk employed by K B Chau and in his charge.

25.The plaintiff's letter of instructions to prepare (inter alia) the mortgage over Richland Gardens came to him from Dominic Mak, with whom as a bank officer of the plaintiff he has dealt frequently. The mortgage was to be a first registered charge securing general banking facilities for the 1st defendant to an unlimited amount, the fees to be based on the agreed accommodation of $9,600,000.00. The instruction required consent of the HA and confirmation of the payment of the premium. He passed the file to Miss Leung, telling her to use the mortgage deed adopted by the plaintiff for third party mortgages; that is those intended to secure advances made to other than the property owners, with no limit to liability. He told her to make contact with a Mr Tam, of the 1st defendant, and make enquiry about payment of the HA premium, and to find out if Mr Ma and Madam Yiu were husband and wife. He said he was concerned about this because wives in third party mortgages commonly complained of committing themselves under undue influence. Having established they were he warned Mr Mak that the wife should be asked if she wanted to be separately represented. Mr Mak told him he knew Mr Ma and Madam Yiu. He believed Mr Ma and the 5th defendant had some form of commercial relationship. Mr Mak said he would get Madam Yiu to call him. And in due course Madam Yiu did so. She told him the premium had been paid. He told her that the plaintiff required her to guarantee accommodation for the 1st defendant of $9,600,000.00 but that liability could extend to an unlimited amount. He told her she and Mr Ma would not be benefiting, apart from the redemption of the Standard Chartered mortgage. He asked her if she wanted her own lawyer; that K B Chau was acting for the plaintiff and could not advise her. She responded that she had no lawyer and there was no need.

26.Next he instructed Miss Leung to make an appointment for the parties to sign and that he would see Madam Yiu independently of the others. She did so and told him they would be calling on 2 June in the afternoon. He did not note his diary; it is not his practice, given he is usually in the office during business hours. However, as it happened, he was not at the office that afternoon, deciding to run a personal errand. Miss Leung contacted him on his mobile at about 5:00 p.m. telling him Madam Yiu was at the office but was in a hurry to get away. The others had arrived earlier, had signed and had left, and none of the firm's other solicitors was free to assist. He decided to allow Miss Leung to attend her because he had already spoken to her about the consequences of committing herself. By the time he returned to the office at 6:00 p.m., the mortgage had been signed and Madam Yiu had gone.

27.He did not make a file note recording events. He relied on his memory to recall them. He did not see fit to get Madam Yiu to confirm in writing that she had been advised to get independent advice but had disregarded that. He did not write to Madam Yiu confirming his advice to that effect. Nor did he write to the plaintiff, in like manner.

28.Miss Leung said she was educated to form 5 level, but failed in English. She has been a conveyancing clerk at K B Chau under the supervision of Mr Poon since 1991. She has over the years been in charge of a number of files, working on average on two per day, up to 500 per year.

29.When she was given the file to prepare a mortgage over Richland Gardens she was told to contact Madam Yiu, check whether she was married to Mr Ma and invite her to instruct her own solicitors. She did so. Madam Yiu told her there was no need. She also asked her to fax the premium receipt and she promised to do so, and did, via Mr Tam of the 1st defendant. She said she would bring the originals when she called to sign the mortgage. Mr Poon told her to arrange appointments for the parties so that he could attend to Madam Yiu separately. She did so, scheduling 4:00 p.m. on 2 June. But when they arrived, Madam Yiu was not with them. Mr Ma told her she had forgotten to bring the original letters and receipt from the HA and would be late. She took them through the documents; they signed and went. Only after their departure did Madam Yiu arrive, alone. She was invited to wait for Mr Poon but declined, saying she was in a hurry. Mr Poon told her on his mobile that it was all right for her to attend to Madam Yiu. And she did. Madam Yiu gave her the original of the HA documents confirming the premium had been paid and the restriction from alienation had been cleared. She also gave her receipts for the current rates and management fees. She took Madam Yiu through the mortgage document. She told her it was to secure credit for the 1st defendant and explained that the personal liability was unlimited. She told her if the borrower defaulted she might be responsible for the whole debt. She told her that the debt could be increased without notice to her. Madam Yiu told her she understood and then signed.

30.During the course of the transaction she came to understand, via Mr Poon, that Mr Ma was 'in something like a partnership with the 5th defendant or they were othewise working together, or he was working for the 1st defendant'. But she made no direct enquiry about this. She did know from her searches that neither Mr Ma nor Madam Yiu were shareholders or directors of the 1st defendant. She took no notes recording what happened. She said it was not her practice as there was no need in conveyancing.

31.That being the evidence, I come now to resolve the dispute therein and make findings of fact.

Findings of Fact

32.But the most compelling finding pays no heed to the conflicts in the evidence. That is that the undisputed issues put this transaction fairly into the category of out of the ordinary cases of which Credit Lyonnais Bank v. Burch is one, namely, that the transaction is so extravagantly improvident that it cries out at the very least for independent legal advice. I find as much for reasons which include the following:-

(a) Madam Yiu comes from a working class background and is not well educated. In particular it is obvious she knows little or nothing of how capital is raised or the consequences of default. She has no ability in English;

(b) Richland Gardens is the only asset of any value that she and Mr Ma own and are likely to own; more importantly it is the family's home for the meantime and prospectively the only nest-egg for the future;

(c) Madam Yiu allowed her husband to impose his will over her and she entrusted to him the responsibility of preserving their wealth;

(d) There was never to be any intention that Madam Yiu would benefit from the transaction, not even indirectly, for neither she nor her husband had any interest in the 1st defendant and there is no significant evidence of any other relationship;

(e) The potential risk of $9,600,000.00 was out of all proportion to the worth of Richland Gardens and Madam Yiu's ability to pay it.

33.In short, the horrific prospective obligation if the borrower were to go broke made imperative anxious consideration for her wellbeing - as Nourse LJ said of the employee's predicament in Credit Lyonnais Bank v. Burch at page 152:-

" ..... it is not enough for Miss Burch to be advised to take independent legal advice. It was at the least necessary that she should receive such advice."

34.But Mr Poon's version, even if an accurate account, displayed the most lackadaisical approach to this vital issue. Madam Yiu was not known to him; they had not met. He said he spoke to Madam Yiu over the telephone, once. Following that conversation, sight still unseen, he proffered he was satisfied that she knew what her commitment was to become and that she waived independent help. But he made no file note of the conversation. He told Miss Leung that he would attend to her when she called to sign the mortgage, and then made no entry in his diary of her appointment. So he gave himself no reminder of what should have been a crucial visit. And having 'stepped out of the office' on a personal matter when she did call, he made no effort to hurry back to look after her, leaving her to Miss Leung, a conveyancing clerk of a number of years experience but who did not do well in English at school and who is not legally qualified.

35.I come now to the evidence that was disputed. Both Mr Poon and Miss Leung sought to portray Madam Yiu as pro-active in the transaction; in particular in the lead-up to signing the mortgage. Both said she telephoned them both, telling them she was married to one of the parties; that she was advised to take independent advice and rejected it; that she told one or other that the premium had been paid, then arranged the faxing of the receipt and letters from the HA; that she attended the solicitors, alone, when she brought with her the original of the HA documents, rates and other utility receipts, and professed to be aware of and ready to risk not just her home but everything she could possibly own if things went wrong.

36.In reality, I am satisfied that nothing of the sort transpired. Madam Yiu had neither the mental capacity nor involvement to behave in this way. I am sure that she was coerced by her husband into making a commitment, one of appalling consequences, of which she was entirely ignorant. She did so so as not to cross her husband. She had no reason to know Mr Mak, and did not know him. She was not told to telephone Mr Poon or Miss Leung and did not do so. She did not attend on her own at the signing of the mortgage. She had no idea about the payment of the HA premium let alone the expense of that, or where it came from, a huge amount, certainly by her standards. She did not fax any documents, nor bring the originals into K B Chau. Prior to signing she received, at most, only a cursory and inadequate instruction of what it was all about.

37.This of course is a finding which falls foul of the evidence of both Mr Poon and Miss Leung. So be it. I prefer Madam Yiu's version, for reasons given.

38.The result of all this was that a debtor having no relationship with her benefited to her exclusion save that the Standard Chartered mortgage was repaid prematurely.

The Outcome

39.The answers to the questions posed earlier are:-

(1) Yes, the relationship between the 3rd and 4th defendants and the nature of the transaction that he asked her to enter into raised the presumption of undue influence, and

(2) No, the plaintiff did not take adequate steps to avoid being fixed with constructive notice of the 4th defendant's rights.

40.The result is that the plaintiff's claim fails save that it shall be entitled to judgment for the amount paid by it to clear the Standard Chartered mortgage of $66,994.64, together with interest of 10.5% per annum from 6 June 1997 to the date of this judgment and thereafter at the judgment rate. The plaintiff is entitled to an order for possession. But the amount I have found due is, relative to the worth of Richland Gardens, not a large amount, and there is a realistic prospect that, given time, it may be raised on the security of Richland Gardens or otherwise. Accordingly there will be an order for possession but with a rider that the plaintiff may not enforce that part of this judgment until after the expiration of two calendar months from this date. I make no order on the counterclaim.

41.Madam Yiu having largely won shall be entitled to all her costs, taxed if not agreed, with her own costs taxed under Legal Aid Regulations.

42.The order for costs shall be nisi at first instance.

Representation:

Ms G Lan, instructed by Messrs Joseph S C Chan & Co., for the plaintiff

Mr N Miu, instructed by Messrs Li, Wong & Lam, for the 4th defendant