The Chartered Bank v. Wong, David (A Male) and Another

HCA004409/1984

HEADNOTE

Contractual Licence declared in favour of mistress - whether revocable at will. Effect of contractual Licence on 3rd parties (purchasers and mortgagees) - wheteher valid without actual notice –Inquiries to be made by purchasers and mortgagees before transaction -- Issue estoppel and res qudicata. Equitable proprietary estoppel - whether expenditure of money required to set up......

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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BETWEEN

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Coram: Garcia J. in Court

Dates of Hearing: 3rd - 7th November, 1986.

Date of Delivery of Judgment: 23rd March, 1987

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JUDGMENT

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1. The plaintiff in this action is the mortgagee of Flat A on the ground floor of Everwell Garden, No. 1 Sheung Heung Street, Kowloon, whilst the 1st defendant Mr. David Wong, is the registered owner thereof. The property was, inter alia, mortgaged to the plaintiff by a Mortgage and Further Charge dated the 8th day of April 1982 and the 26th day of August 1983 respectively to secure banking facilities for the Third Party, D. Wong Engineering Co. Ltd. in the amount of $5,000,000. Under this arrangement the plaintiff advanced $3,399,108 to the Third Party up to the 21st day of June 1984. The 1st defendant and the Third Party have defaulted in payment of that sum and interest thereon at the rate of $1,461.27 per day, and under the terms of the mortgage the plaintiff is entitled to enter into possession of, and sell, the property. In the instant action the first defendant consented to judgment on 3rd January 1985 in the following terms:

2. The judgment debt has not been satisfied nor has vacant possession of the property been delivered up to the plaintiff. The 2nd defendant who is the ex-mistress of the 1st defendant has occupied, and still continues to occupy, the said property by virtue of a declaration made by Hunter, J. in High Court Action No. 11683 of 1982 that she is a contractual licensee of the 1st defendant, with the right to occupy the said premises with her 2 children for so long as the latter are receiving full time education and the premises are reasonably required for their occupation. The plaintiff now claims vacant possession of the premises together with damages for wrongful occupation, and whilst admitting that there is a declaration in her favour to the effect that she is a contractual licensee, it contends that such a licence does not avail against a mortgagee entitled to possession on non-payment of the secured sum for the following reasons:-

3. In her Defence and Counterclaim in this action the 2nd defendant avers the same matters which she had relied upon in HCA No. 11683 of 1982 but instead of resting on the declaration that she is a contractual licensee of the 1st defendant, she now claims a beneficial interest in the property, the share of which she asks the Court to determine. In respect of the 1st defendant, she further claims (i) an indemnity against him for any damages which may be found due to the plaintiff, (ii) the said beneficial interest and an order that he transfer the share of such interest to her upon determination by the Court and (iii) an order that the 1st plaintiff provide suitable accommodation for her and her 2 children by the 1st defendant, namely, Alice and Arnold Wong should the plaintiff obtain possession of the property.

4. It is relevant to refer briefly to some of the basic facts surrounding the purchase of the property sometime in October 1972 by the 1st defendant. In 1969 he was the managing director of D. Wong Engineering Co. Ltd. the Third Party, with an office in Shaws Building, Kowloon. The 2nd defendant was then working as a photocopier in another office in the same building - at that time she was 21 years old whilst the 1st defendant was 42. They had a chance meeting one day in the lift lobby of the said building, and from then on, it is said. that he had courted her with much persistence and determination so much so that in order to have her accede to his request that she live with him, he expressed a desire to commit suicide and did make an attempt in doing so when she refused his request. He was then already married and has 3 daughters by his wife, but he states that he and his wife did not get along well together. By 1971, he had reached the stage when he left the matrimonial home to take up residence in the Y.W.C.A. in Homantin, Kowloon where the 2nd defendant spent some time with him. From there he moved out to a room in a flat in Beacon Hill Road in order to be further away from the 2nd defendant's home in an attempt to discontinue the liaison but this did not succeed. Finding the accommodation in the room cramped and limited and to satisfy his wish that the 2nd defendant live with him, he bought the said property with her whole-hearted approbation. However, he now says that the property was acquired mainly for the purpose of investment, secondly for providing a home for himself, and lastly, for providing a home for himself and the 2nd defendant who had by that time become pregnant. The liaison continued for a period of about 7 years, during which time 2 children were born, the daughter Alice on 12th May 1973, and the son Arnold on 21st July 1978. When the liaison came to an end, principally because he had become enamoured of his then secretary, he decided to terminate what was then described as a gratuitous licence granted to the 2nd defendant to occupy the said property so as to install his secretary who had by then become a his mistress. His efforts to determine the licence out of Court failed and these culiminated in his issuing a writ against the 2nd defendant on 4th December 1982 (High Court Action No. 11683 of 1982) to evict her from the said property. In her defence to that action, she pleaded that she had an implied contract to reside in the said premises with her 2 children during her lifetime or for so long as the children were receiving full-time education or they reasonably required the said premises for their accommodation.

5. The issues between the 2nd defendant and 1st defendant in that action were whether (i) the 1st defendant was entitled to revoke at will the licence impliedly granted to the 2nd defendant to occupy the said property, and (ii) by reason of the 1st defendant's conduct over the years when they lived together, and by reason of his promise that he would provide for her and the two children of their union, she had acted to her detriment, thereby raising an estoppel against him from removing her and the children from the said premises for the alternative periods of time claimed in her counterclaim. The result of that action was the declaration referred to earlier.

6. Both the plaintiff and the 1st defendant have specifically pleaded that the 2nd defendant is estopped from raising in her defence and counterclaim, and relitigating, the matters which had been adjudicated upon by Hunter, J. in H.C.A. No. 11683 of 1982. The matters specifically referred to are:-

7. In the course of his judgment in H.C.A. 11683/83, Hunter, J. stated:-

"Matters came to a head over a period of about a month in July/August. First the plaintiff (1st defendant) persuaded the defendant to spend 3 nights with him at the Y.W.C.A. The depth of their relationship could no longer be concealed from her father. He was incensed but did his best to protect his daughter. His request to the plaintiff to provide her with some security where skilfully side-stepped. The plaintiff freely promised to look after the defendant and their family forever, and did everything he could to persuade the defendant to believe that he was looking forward to a long standing and not to some temporary relationship, but he did nothing concrete to protect her. Torn between the father's warnings and her affection for and faith in the plaintiff, the defendant chose the plaintiff. Some three weeks after her initial stay she returned to the Y.W.C.A. to live with him permanently. In September she realised she was pregnant. The parties quickly chose together the furnishings and fittings for the flat. The purchase in the plaintiff's name was completed on 26th October, and both parties took possession on 7th November 1972. For about the next seven years the plaintiff and the defendant lived together in harmony as man and wife. The plaintiff was generous in the provision he made for her and the family. She did everything that she could to fulfill the role of the wife at home and in relation to his work. Alice was born on 12th May 1973; and Arnold on 21st July 1978. The latter event was the culmination of the plaintiff's joy. He now had a son to carry on his name and to inherit his business. I am quite sure that he was then effusive in his expressions of delight and in his promises to the defendant about looking after her in the future. But again he was careful to avoid any commitment. On the two occasions at about this time when the defendant asked him to give her some security by implementing what she regarded as his earlier promise to put the flat in the joint names, he prevaricated. In truth I am satisfied that he had no intention ever of doing any such thing."

8. After considering the principles enunciated in Tanner v. Tanner; Horrocks v. Forray; Hardwick v. Johnson; Re Sharp; and Chandler v. Kerley, Hunter, J. went on to say:-

"Applying these principles to the present facts, it is in my judgment right to regard the defendant's licence as contractual. Public policy and illegality exclude any claim by her alone to occupy; but not a claim derivative from the interests of the children. In any objective view there was here an intention to create legal relation, the circumstances being the converse of the husband and wife cases. There was, I think, sufficient consideration initially in her implied promise to care for the unborn child and for any future children; and after their birth in the reaffirmation of such promise implicit in its performance. I see no greater need than did the Court of Appeal to consider whether this makes the licence contractual in its inception or only from some later date. The circumstances are too elemental to give rise to any problem of certainty. I therefore conclude that the basic contractual requirements are here present."

9. In dealing with the question of equitable proprietary estoppel he states:-

"This said only to arise where the claimant has 'at law no......... licence other than a licence revocable at will' Pascoe v. Turner (1979) 2 A11 E.R. 945 per Cumming Bruce L.J. at page 950g. Although not all the authorities draw this clear distinction I am happy to adopt it. Once its original strict proprietary limits are left behind, I have had much difficulty in determining how far this concept goes; and not least difficulty in treating a period of deliberate cohabitation as constituting detriment to the woman within this concept without putting cohabitation on a superior plane to marriage. It is sufficient to say that on my findings the point does not arise for decision."

10. Clearly the matters enumerated in the 2nd defendant's defence and counterclaim have been the subject of the judgment referred to and have been specifically dealt with, even though no decision was made on the plea of "equitable proprietary estoppel".

11. The conditions upon which issue estoppel, specifically pleaded by both the plaintiff and 1st defendant, would be applicable are:-

12. There is no doubt that insofar as the 1st defendant is concerned the judgment of Hunter, J. puts an end absolutely to the questions raised again by the 2nd defendant in her defence and counterclaim, the conditions upon which issue estoppel is founded, having been satisfied. Insofar as this question concerns the plaintiff, the problem as to the application of issue estoppel in relation to the matters raised by the 2nd defendant, lies in the construction of the words "parties" and "privies" in satisfying condition (iii) - although conditions (i) and (ii) would have been complied with. It has been submitted for the 2nd defendant that the plaintiff mortgagee was the predecessor in title of the 1st defendant and therefore the plaintiff would be bound by the issues determined by Hunter, J. in the previous proceedings. A definition of "privies" appears in the judgment of Lord Guest in the Carl Zeiss Stiftung case citing Spencer Bower on Res Judicata as follows:-

"Privies have been described as those who are privy to the party in estate or interest (Spencer Bower at p.130). Before a person can be privy to a party, there must be community of privity of interest between them."

The statement quoted from Spencer Bower on Res Judicata is as follows:-

"An estoppel per rem judicatum operates for or against not only the parties but those who are party to them in blood, title or interest."

Again quoting Spencer Bower:

"When privity of estate is set up as the foundation of estoppel per rem judicatum the title relied upon to establish such privity must have arisen after the judgment in which the res judicata is based, or at least after the commencement of the proceedings in the course of which that judgment was given.

(See Pople v. Evans)".

13. The mortgage of the property in question was executed on 8th April 1982, long before the issue of the writ in HCA11683/82 on 4th December 1982.

14. At first sight, it would appear that on the principles mentioned that as between the plaintiff and the 2nd defendant there was no privity of interest between them and that prima facie the plaintiff qua mortgagee was not privy either to the 1st defendant or the 2nd defendant in respect of H.C. Action No. 11683 of 1982. However, on 16th November 1983, that is, about 2 weeks before the trial of that action took place, the following letter was written by the 1st defendant's solicitors to the plaintiff:-

"16th April 1983

The Chartered Bank

8-10 Granville Road

Tsimshatsui

Kowloon

(Attn.: Mr. Burgess - By Hand)

Dear Sirs,

Re:   Everwell Garden, Flat A,

Ground Floor, No. 1 Sheung

Heung Street, Kowloon.

        H.C. Action No. 11683 of 1982

We act for Mr. David Wong, the plaintiff of the captioned action and also the registered owner of the captioned premises.

We are given to understand that all the title deeds of the captioned premises are now in your custody. We are instructed to inform you that we require the said title deeds for Court purpose on 29th and 30th November 1983. We would be obliged if you could kindly let us have the same at your earliest convenience. We undertake to return the same to you upon the completion of the said case.

We also undertake to pay you necessary production fee, if any.

Yours faithfully, (Sgd.) Walter Yeung & Co."

15. It should have been clear to the recipient of this letter that there was a question to be decided in respect of the property of which the plaintiff was the mortgagee and although the letter did not require intervention in the proceedings then on foot, nevertheless an inquiry should have been made by the plaintiff as to what the action was all about since it involved property in which the plaintiff had a proprietary and financial interest, and the plaintiff could have been joined in the action as an interested party. I am prepared to hold that this letter constituted a constructive notice to the plaintiff that its interest in the property was involved in the action. It has been said by Lord Guest in Carl Zeiss Stiftung  v. Rayner & Keeler Ltd. (No.2) that "there is a dearth of authority in England upon the question of privies", but in the circumstances of this case, and having regard to the definition of "privies" earlier cited, I am also prepared to hold that there was a community of interest between the plaintiff and the 1st defendant in the previous action, so as to bring the plaintiff within the meaning of the word "privies", in relation to the doctrine of issue estoppel, such community of interest having arisen after the proceedings had been instituted by the first defendant.

16. It has been submitted on behalf of the plaintiff that since the judgment of Hunter, J. new material is now available to the plaintiff, i.e. the judgment of Jonathan Parker Q.C. in Coombes v. Smith (1986) 1 W.L.R. 809, and that therefore issue estoppel should have no application to the issues between the plaintiff and the 2nd defendant in the instant case. Authority for this proposition is derived from a statement of Diplock, L.J. in Mills v. Cooper (1967) 2 Q.B. 459 and 468:-

"A party to civil proceedings is not entitled to make, as against the other party, an assertion, whether of fact or of the legal consequences of facts, the correctness of which is an essential element in his cause of action or defence, if the same assertion was an essential element in his previous cause of action or defence in previous civil proceedings between the same parties or their predecessors in title, and was found by a court of competent jurisdiction in such previous proceedings to be incorrect, unless further material which is relevant to the correctness or incorrectness of the assertion by that party in the previous proceedings has since become available to him."

17. In Coombes v. Smith, the plaintiff and defendant were both married to other parties when they became lovers in April 1974. In Octeber 1974 she became pregnant and in December 1974 moved into a home at 67 Bulwark Road which was bought by the defendant. The defendant did not move in to live with her although he had promised to do so. However, he visited her regularly and paid all bills including the mortgage instalments for the house and gave the plaintiff and her child an allowance. The plaintiff who was a van driver with a trading company, continued to work for 4 or 5 hours after moving into the house but after the birth of the child in June 1975 she remained home to look after the child and did not go out to work. In August 1977 the defendant, after deciding that the plaintiff and the child move to a house nearer his place of work bought another house into which the plaintiff and the child moved. The defendant, although expressing a desire to move into the house to be with her, never did. The plaintiff did a lot of decoration work to the house and improved the garden and asked the defendant twice if he could put the house in their joint names. He refused but during the course of their relationship which last 10 years, he assured her that he would always provide for her and then she would always have a roof over her head. When the association ended he offered her a sum of £10,000 to move out but she refused.

18. In the plaintiff's action, based on proprietary estoppel and contractual licence, for an order that the property be conveyed to her absolutely or alternatively for a declaration that she was entitled to occupy it for life, "it was held (1) that when the plaintiff left her husband and moved into the first house bought by the defendant she did nothing that amounted to providing consideration for, and it was impossible to infer a contract between the parties that the defendant would provide the plaintiff with a house for the rest of her life. (Tanner v. Tanner distinguished); (2) that on his evidence, the plaintiff  had not held a mistaken belief that she would have this right to remain in the house indefinitely against the defendant's wishes since these parties had not discussed what was to happen in the event of their relationship breaking down and a belief that the defendant would always  provide a roof over her head was not sufficient; that further the plaintiff had not acted to her detriment in becoming pregnant, leaving her husband, looking after this house and child improving the house or in not looking for a job; then, accordingly, the plaintiff had not established the elements necessary to give rise to an equity in her favour to remain in the house once the child was 17."

19. In my view this case was decided very much on its own facts, the learned judge not having been able from the evidence to justify the inference of any contract entitling the plaintiff to be accommodated at the second house or at an equivalent house for the rest of her life.

20. There is no new material in this case which would be relevant to the correctness or incorrectness of the decision reached by Hunter, J., that is, that the 2nd defendant is a contractual licensee of the 1st defendant in relation to the premises in question. In connection with the submission that new material would affect the finality of a judgment, in relation to issue estoppel, Lord Shaw in Hoystead v. Taxation Commissioner (1926) A.C. 155 says:-

"In the opinion of their Lordships, it is settled first, that the admission of a fact fundamental to the decision arrived at cannot be withdrawn and a fresh litigation started, with a view to obtaining another judgment upon a different assumption of fact; secondly, the same principle applies not only to an erroneous admission of a fundamental fact, but to an erroneous assumption as to the legal quality of that fact. Parties are not permitted to begin fresh litigation because of new views they may entertain of the law of the case or new versions which they present as to what should be a proper apprehension by the court of the legal result either of the construction of the documents or the weight of certain circumstances. If this were permitted litigation would have no end, except when legal ingenuity is exhausted. It is a principle of law that this cannot be permitted, and there is abundant authority reiterating that principle. "

21. In my judgment the 2nd defendant is estopped from re-litigating the issues which have been decided upon in previous proceedings (HCA 11683/83) and that in the instant case, as between her and the plaintiff, she is the contractual licensee of the property in question for the period set out in the declaration made on 3rd January 1985.

22. I have therefore to decide to what extent such a licence affects the rights of the plaintiff to possession of the property, and the sale thereof under the mortgage, i.e. whether the licence binds the plaintiff as a third party.

23. Lord Denning, M.R., in discussing this question in Binions v. Evans (1972) C.A. 1 Ch. 367, reviewed a number of cases where equity came to the rescue of those with rights of a contractual licensee: in particular, Foster v. Robinson (1951) 1 K.B. 419 and Brrington v. Errington & Woods (1952) 1 K.B. 290, where it was decided that a contractual licence is, on equitable grounds, valid against all except a purchaser for value without notice. This matter is however not entirely free from doubt and Lord Denning in dealing with such doubts, e.g. expressed by Goff, J. in re Solomon (1967) Ch. 573, came to the conclusion that they cannot prevail where the situation gave rise to a constructive trust. He instanced the case where an owner sells land to a purchaser with the stipulation that the latter takes subject to a contractual licence - the Court of Equity would imposes on the purchaser a constructive trust in favour of the beneficiary. That the law in this area is very far from clear has been expressed by Lord Wilberforce in National Provincial Bank Ltd. v. Hastings Car Mart Ltd. (1965) A.C. 1175, 1251: 'The Court of Appeal has attempted to reach a generalisation by which licences, or at least licences coupled with occupation, are binding upon "purchasers" but I note that the members of that Court are not wholly agreed as to this doctrine. No doubt the time will come when this whole subject will have to be reviewed; this is not the occasion for it and I think that it would be undesirable now to say anything which might impede the development of this branch of the law." Lord Denning however would imply a constructive trust where the contractual licensee is in occupation.

24. In the instant case, my view is that the rights of the 2nd defendant to the said premises do not go beyond those of a contractual licensee in the terms of the declaration made by Hunter, J., the circumstances, including her occupation of the premises, not having given rise to a constructive trust in her favour. At the highest the licence would only avail against a purchaser for value with notice.

25. Whether actual notice of the licence is required or constructive notice thereof is sufficient for a purchaser to be bound is not clear from the authorities although it was assumed in Midland Bank Ltd. v Farmpride Hatcheries, Ltd. (1981) 260 Estates Gazette 2 493, C.A. without any argument being advanced that constructive notice would suffice.

26. Assuming that this view of the law is correct, how would it be possible for a purchaser or a morgagee to ascertain, even making the most careful inquiries and acting on skilled advice, whether a property in which he is interested might in future be subject to equitable interests in the form of a contractual licence, to avoid being fixed with constructive notice of such interests?

27. Evidence has been adduced in the instant case that a surveyor and a representative employed respectively by the plaintiff, and a previous mortgagee of the 1st defendant, went to inspect the property in order to ascertain if there were people living there and discovering the 2nd defendant in occupation asked her what her relationship to the 1st defendant was, that is, whether she was a tenant or a relative. The 2nd defendant acknowledges that she had realised at the time when the property was mortgaged the general economic situation of Hong Kong was not good, and that because of cash-flow problems encountered by the 3rd Party, the said premises had to be mortgaged together with other property owned by the 1st defendant, and she had given her approval to the mortgage of the said premises being granted to the previous mortgagee.

28. Regarding the visits of the abovementioned representatives she says that when asked, she told them that she was Mrs. Wong, and explains this by stating that Mr. Wong, the 1st defendant had usually introduced her to his friends as such. There was no reason why she should not use such a title since both she and the 1st defendant had been living together as man and wife.

29. The difficulties which representatives of any Bank or mortgagee charged with this type of inquiry would face in the context of Hong Kong society, and anywhere else for that matter, cannot be easily overcome since in carrying out such duties it would entail offence and embarrassment to the person enquired of, for instance, whether Mrs. Wong was or was not legally married to Mr. Wong, and whether their relationship was nor was not harmonious in order to seek an opinion as to what equitable rights would accrue to the wife or mistress should the association come to an end. I imagine that questions such as these would evoke similar reactions from Mr. Wong.

30. While it would not be impossible for such inquiries to be made, it would do little or no good for the business of banking in Hong Kong, the consequences of which might seriously affect the economic welfare of the business community here. In this respect I would like to quote from the judgment of Lord Upjohn in National Provincial Bank, Ltd. v Hastings Car Mart, Ltd. the following: "....surely any inquiry, if it is to be made reasonable must be capable of receiving a positive answer as to the rights of the occupier and lead to a reasonably clear conclusion as to what those rights are. The answer "I am a deserted wife" (if given) only gives notice of a right so imprecise, so incapable of definition, so impossible of measurement in legal phraseology or terms of money that if he is to be safe the mortgagee will refuse to do business and much unnecessary harm will be done ..... It does not seem to me that an inquiry as to the marital status of a woman in occupation of property is one which the law can reasonably require to be made; it is not reasonable for a third party to be compelled by law to make inquiries into the delicate and possibly uncertain and fluctuating state of affairs between a couple whese marriage is going wrong, Still less can it be reasonable to make an inquiry if the answer to be expected will probably lead to no conclusion which can inform the inquirer with any certainty as to the rights of the occupant. These considerations give strong support to the opinion I have already expressed that the rights of the wife must be regarded as purely personal between herself and her husband." Although this case was decided in relation to the rights of a deserted wife to the matrimonial home, I am of the opinion that these considerations apply with equal or even greater force to such rights as may arise on the termination of an association between a man and his mistress.

31. In my judgment the only notice which would bind a purchaser or mortgagee would be actual notice, either communicated to the proposed mortgagee by the mortgagor, or by entry registered in the Land registers kept under the Land Registration Ordinance, of the existence of such beneficial interests.

32. One further matter which requires consideration is the claim by the 2nd defendant to a beneficial interest in one half of the suit premises, based on proprietary estoppel. One of the elements for proprieatry estoppel to arise (see Crabb v. Arun District Council) is that the person claiming must have incurred expenditure or otherwise prejudiced himself or acted to his detriment in relation to the property of which the interest is claimed (per Dunn, L.J. in Greasely . Cooke (1980) 3 AIR. E710 C.A.) However in the same case, Lord Denning, M.R. did not think that the expenditure of money was a necessary element for the application of the doctrine, stating: "It is sufficient if the party, to whom the assurance is given, acts on the faith of it - in such circumstances that it would be unjust and inequitable for the party making the assurance to go back on it. See Moorgate Mercantile Co. Ltd. v. Twitchings (1976) Q.B. 225 and Crabb v. Arun District Council (1976) Ch. 179, 188.'' But in Burns v. Burns (1983) 1 Ch. 317, it was held by the Court of Appeal that since the plaintiff had not made a substantial financial contribution to the acquisition of the house the court could not impute a common intention that she should acquire a beneficial interest in it; that the plaintiff's contribution to the welfare of the family by performing the domestic duties of the household and bringing up the children were not factors which could be taken into account in determining whether or not she had acquired an interest in the house; and that, accordingly, the plaintiff had failed to demonstrate the existence of any trust in her favour.

33. In that case, the plaintiff and the defendant were not married but lived together for a total of 17 years before the association broke up. Two years after they had begun to live together the defendant bought a house with money provided by him and he also made the mortgage payments, without any direct contributions from the plaintiff. The house was conveyed to him in his sole name. The parties had two children and during the association, the plaintiff remained at home to look after them and to perform domestic duties. She was therefore unable to earn any money until 12 years later when she worked as a driving instructor. She was given a generous housekeeping allowance and was not asked to contribute to the household expenses but she used her earnings to pay the rates and the telephone bills and buy fixtures, fittings and certain domestic chattels for the house. She also redecorated the interior of the house. When the defendant left her, she claimed that she was entitled to a beneficial interest in the house by reason of her contributions to the household over the years they had lived there.

34. In the course of his judgment, Fox L.J. said: "It seems to me that at the time of the acquisition of the house nothing occurred between the parties to raise an equity which would prevent the defendant denying the plaintiff's claim. She providcd no money for the purchase; she provided no liability in respect of the mortgage; there was no understanding or arrangement that the plaintiff would go out to work to assist with the family finances; the defendant did nothing to lead her to change her position in the belief that she would have an interest in the house. It is true that she contemplated living with the defendant in the house and, no doubt, that she would do housekeeping and look after the children. But these facts do not carry with them any implication of a common intention that the plaintiff should have an interest in the house. Taken by thomselves they are simply not strong enough to bear such an implication."

35. He then went on to deal with the earnings which the plaintiff used for the payment of the rates, telephone bills, buying fixtures, fittings and certain domestic chattels for the house, gifts of clothing to the defendant and to the children, and also her work on the house.

36. Further on in the judgment, he states: "What is asserted here is the creation of a trust arising by common intention of the parties. That common intention may be inferred where there has been a financial contribution, direct or indirect, to the acquisition of the house. But the mere fact that parties live together and do the ordinary domestic task is, in my view, no indication at all that they thereby intended to alter the existing property rights of either of them. As to that I refer to the passage from the speech of Lord Diplock in Pettitt v. Pettitt 1970 A.C. 777, 826 which I have already mentioned; and also to the observations of Lord Hodson in Pettitt v. Pettitt at p. 811 and of Lord Reid at P. 796. The undertaking of such work is, I think, what Lord Denning, M.R. in Button v. Button (1968) 1 W.L.R. 457, 462 called the sort of things which are done for the benefit of the family without altering the title to property. The assertion that they do alter property rights seems to me to be, in substance, reverting to the idea of the "family asset" which was rejected by the House of Lords in Pettitt v. Pettitt (1970) A.C. 777. The decision in Gissing v. Gissing (1971) A.C.886 itself is really inconsistent with the contrary view since the parties lived together for ten years after the house was bought. In Hall v. Hall, 3 F.L.R. 379, 381, Lord Denning, M.R. did say:

"It depends on the circumstances and how much she has contributed -- not merely in money -- but also in keeping up the house; and, if there are children, in looking after them."

37. With respect I do not find support for that in the other authorities and I do not think that it is consistent with principle. I am not clear to what extent the matter was material in Hall v. Hall. So far as looking after children is concerned, it appears that there were no children: see per Dunn, L.J., at p. 382. The case seems to have proceeded on the concession made by the man that the woman was entitled by way of resulting trust to a share in the house. The parties lived together for seven years and it was accepted by the man that they could not have bought the house but for the fact that both were earning: see per Lord Denning M.R. at p.381. The parties in fact, pooled their resources: see the findings of the judge at p.383. Accordingly, it seems to me that the case may well have been one where the woman, through the pooling of their income, made a contribution, direct or indirect, to the mortgage payments."

38. In the instant case, the 2nd defendant never made any contributions either to the initial deposit payment made by the 1st defendant when the premises were purchased or towards the instalments to discharge the mortgage granted upon the purchase of the property. Like the plaintiff in the above cited case she was given a generous allowance by the 1st defendant but there is no evidence to indicate that she had expended that allowance in household expenses or on anything which would have been referrable to her acquiring an interest in the property. Leaving her father's home, which was allotted to him by the Housing Department, to live with the 1st defendant does not in my view constitute such a detriment as would sufficiently and significantly found the inference that there was a common intention that she should have a share in the premises. In referring once again to the judgment of Hunter, J. and which I have mentioned earlier, the 1st defendant had never had any intention of implementing a promise that he would put the property in their joint names.

39. Her claim for a share in the premises is therefore dismissed.

40. Accordingly there will be judgment for the plaintiff as claimed with costs to be taxed.

41. This judgment necessarily involves the breach by the lst defendant of the contractual licence (see Tanner v. Tanner) and in the result the 2nd defendant is entitled as against the 1st defendant to (i) a declaration that he provide suitable accommodation for her and for her 2 children, Alice and Arnold Wong, for so long as the said children shall be receiving full-time education; or for so long as and the two children reasonably require the accommation (ii) damages and (iii) costs to be taxed.

Representation:

Mrs. Barbara Kaplan (Deacons) for plaintiff.

Miss Susan Kwan (Haldane Midgley & Co.) assigned by D.L.A. for 2nd defendant.

1st defendant in person.