Zee Cheung Yok Lin v. Zee Tak Foong

HCMP000198/1972

IN THE SUPREME COURT OF HONG KONG

ORIGINAL JURISDICTION

MISCELLANEOUS PROCEEDING NO.198 OF 1972

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Coram: Briggs, J. in ...(illegible)

Date of Judgment: 22nd January, 1973

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JUDGMENT

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1. This is a summons brought under Sections 6 and 7 of the Married Persons Status Ordinance. Section 6 is a re-enactment of Section 17 of the Married Woman's Property Act, 1882.

2. The parties to the summons are husband and wife, the wife being the plaintiff. The summons seeks the determination of three matters: the first concerns the ownership of Flat "F" on the 5th floor of Yuet Wah Mansion, Yuet Wah Street, Kwun Tong. [I shall refer to this flat as "Flat F" in this judgment]: the second concerns the ownership of the business of the Lai Wah Barbers, which is conducted on premises at 45 Nam Kok Road, Kowloon. [I shall refer to this as "the Lai Wah business"]: the third matter concerns certain loans totalling $25,000 allegedly made by the wife to the husband between 1969 and 1971.

3. I will deal with these matters in the reverse order, starting with the third matter, the alleged loans.

4. Section 6 of the Ordinance refers to questions between husband and wife as to the title to or possession of property. It is settled law that a loan by one spouse to another is not "property" for the purposes of a summons under this section. And that, presuming that one spouse has lent money to the other, such loans, though they may be recoverable by action, cannot be dealt with by such a summons [See Crystall v. Crystall.⁽¹⁾]. The plaintiff in this case therefore cannot be granted the declaration she seeks in paragraph 3 of the prayer of the summons. Whether or not the plaintiff did in fact lend money to the Defendant I do not know, the matter has not, and properly not been canvassed before me. But if such loans were made they cannot be part of the property in dispute between the parties. Any money handed over would become the property of the Defendant subject of course to his contractual right to repay.

5. The second matter concerns the ownership of the Lai Wah business. The parties were married in 1950. At that time the Defendant was a partner in two barber's shops and the plaintiff was a manicurist.

6. In 1953 the Defendant purchased the Lai Wah business for $25,000. The agreement has been exhibited. It definitely states that the purchaser is the Defendant. However the agreement does recite that the vendor, one Lau Kai ...(illegible) to sell all the tools of trade" of the Lai Wah business to the plaintiff and the defendant who are to "buy and take up the business".

7. It is the plaintiff's case that she and the defendant were the joint purchasers. Indeed in her first affirmation and in the witness box she said that the Lai Wah business was purchased in the joint names of herself and her husband. She said she contributed $7,000 and the defendant $3,000 towards the purchase price at the time of the sale. The rest of the money being paid off instalmentally from the profits of the business.

8. The defendant denied this. He said that he purchased the business himself and that the plaintiff did not contribute to the purchase price nor did she sign the agreement as purchaser. The business was registered in the name of the defendant as sole proprietor.

9. The defendant called one Cheung Fung Ming who was a witness to the agreement to purchase the Lai Wah business. He confirmed the account of the defendant and he said that the defendant supplied the whole of the $10,000 at the time of the purchase.

10. The defendant was in debt at about this time and in order to square his indebtedness he sold his interests in the two partnerships in which he was then employed. With part of this money he paid the $10,000 for the Lai Wah business.

11. I accept the evidence of the defendant and his witness, whom I regard as an independent witness and I reject the evidence of the plaintiff on this issue.

12. The mere fact of the recital of the name of the plaintiff is the agreement to purchase the business does not in my view amount to a purchase by the plaintiff and defendant jointly. Indeed when the agreement is looked at as a whole it is clearly a purchase by the defendant only.

13. The plaintiff was an unreliable witness. She said for example when she first came to Hong Kong from Shanghai in 1949-50, she had taken a job as a manicurist at which she earned $1,000 per month. From the evidence of other witnesses it is evident that this sum is grossly exaggerated. Again she said after the purchase of the business she was its manager. She received no remuneration. This was denied by the defendant and I accept his evidence. She was a manicurist and she continued her work as ...(illegible) . In addition she was given a household allowance by the defendant. This evidence was contained in her affirmation. Later, in the witness box she said she did have a salary from the business. Her evidence was muddled and unconvincing. I had the distinct impression that she was not treated like, nor did she act as an employer in the business, and that she received nothing from the proceeds of the business. However though she did assist her husband in certain ways in the running of the business, there was no question of the business being a joint venture. What she earned as a manicurist was her own. She did not have to account for this to the business. In addition she received a household allowance from the defendant like any housewife. Later the plaintiff engaged in a business venture on her own together with others which was only partially successful. The defendant did not participate in this directly, nor are we concerned with that matter in this summons.

14. As to the second matter therefore there will be no declaration as prayed that the Lai Wah business is the joint property of the plaintiff or the defendant. In my view it is the property of the defendant and always has been.

15. I now come to the first matter, the ownership of Flat F. The plaintiff says Flat F was purchased as the matrimonial home for $40,000 in May 1970. The plaintiff's case is that she provided the purchase price and she produced evidence to show that she withdrew $40,000 from her personal savings account at the Hang Seng Bank in order to meet this commitment. The property was conveyed into the joint names of the parties in June 1970.

16. The plaintiff said that this was because she had had a serious operation. She thought she might have a recurrence of the illness, which could result in her death. Therefore she arranged for the conveyance to be in the joint names of the parties. I cannot accept that this was the reason. The plaintiff is a business woman and was at that time in consultation with solicitors. They would have told her that unless she made a will, her husband, the defendant, would have inherited the property even if it had remained in her own name only. It is obvious, and indeed it is not denied that the purchase was made for the provision of a matrimonial home. The question is who provided the money?

17. The plaintiff says she provided it all and that the sum was $40,000. In her affirmation the defendant said that the purchase price of the flat was $40,000. But in the witness box he said that it cost $60,000. On ...(illegible) he said he provided all the money. For some reason no document evidencing the sale was exhibited to the court, so I am left in doubt as to the amount of the purchase price.

18. The defendant said that he arranged the purchase of the flat. He paid a deposit of $2,000, then a sum of $18,000 as part of the purchase price. Later he borrowed the rest from 6 friends whom he named. He said he gave these persons post dated bearer checks for the amount of their loans. If he was unable to repay the loans the check would be cashed. When a loan was repaid he would inscribe the check with the words 'this check is void'.

19. The plaintiff exhibited 16 checks all drawn by the defendant. They are bearer checks. They were drawn between December 15th 1969 and January 3rd 1971. They total $25,000 but three checks, amounting to $8,000 are stated to be void. None of the checks appear to have been cashed. The plaintiff's evidence is that these checks were made out by the defendant to pay his gambling debts and that she redeemed them: i.e. she paid the person when he presented the checks to her.

20. Of the two versions I much ...(illegible) that of the plaintiff to that of the defendant. The plaintiff's evidence was corroborrated by documentary evidence. I cannot accept the evidence of the defendant on this issue. First there is his uncertainty as to the purchase price. Secondly he did not call any of the persons from whom he had, he said, borrowed money though they were named in his evidence. Thirdly the purchase of the property was May and June 1970, yet no explanation was given why the first check was dated December 1969. Finally it appears that all the money borrowed as evidenced by the checks has been repaid. According to the defendant this was achieved from the profits of the Lai Wah business. If that is so I do not see the necessity for borrowing: the amounts borrowed could have been transferred towards the purchase price directly from the profits of the business.

21. I find therefore as a fact that Flat F was purchased by the plaintiff. The fact that she has had the property conveyed into the joint names of herself and the defendant does not raise a presumption that she has given a half-interest in the flat to the defendant. No such presumption arises in such a case. The property is the matrimonial home. The half share of the defendant is held by him in trust for the plaintiff and there will be a declaration accordingly.

22. The defendant has succeeded in two of the three issues. However Mr. Li for the defendant very properly abandoned the third matter (which concerns alleged loans made by the plaintiff to the defendant). So in effect each party has in part succeeded. I think that there should be no order for costs in the circumstances. There will be a certificate for counsel.

Representation:

(1) [1963] 2 All E.R. 330