Read the full judgment text of CACV 187/2013 on BabelCite. This Court of Appeal judgment was delivered on 4 July 2014 before Cheung JA, Chu JA and Mimmie Chan J.
Equity – resulting trust – presumption of advancement – presumption of gift – transfer of legal and beneficial title – gratuitous transfer – mother and child – expressed but unpaid consideration – deed of assignment – construction of document – estoppel by deed – receipt clause – pleading of resulting trust – fresh evidence on appeal – appellate review of factual findings. The plaintiff, an elderly woman, transferred two Hong Kong properties (a shop and a flat) to her adult daughter, the defendant, in September and October 1999 for stated consideration of $300,000 and $500,000, which was admittedly never paid. The plaintiff claimed the transfers were made solely to defeat an anticipated claim by her husband Mr Tam to recover the properties for the benefit of his concubine Lou Nui, and that the defendant had promised to support her and give her a proper burial. The defendant claimed the transfers were an outright gift. The plaintiff continued to occupy the flat and pay rates, but was locked out in 2009, and the defendant then sold the flat for some $4,316,000. The plaintiff commenced proceedings seeking a declaration that the defendant held the properties on trust for her. The Recorder found the plaintiff to be a truthful witness, rejected the defendant's evidence, and held that the defendant held the properties on resulting trust for the plaintiff. On appeal, the Court of Appeal dismissed the appeal, holding that the Recorder's finding of fact on the plaintiff's intention was not plainly wrong, that resulting trust arose because the stated consideration was false and the transfer was intended as a voluntary assurance, that section 17 of the Conveyancing and Property Ordinance (Cap 219) could not override the transferor's actual intention or the operation of resulting trust, that the defendant could not rely on the receipt clause or section 18 of the CPO given her own admission that no consideration was paid, and that the resulting trust was adequately raised by the pleadings. On the presumption of advancement, the Court followed the modern approach and held that the presumption applies equally to a transfer from a mother to her child, abandoning the traditional Bennet v Bennet view that no moral obligation rested on a mother to provide for her child. The Court further held that the presumption is, however, a weak evidential tool easily displaced on slight evidence, and left open the question whether it applies to an independent adult child. The Court also rejected the defendant's application for discovery and to adduce a 1997 will of the plaintiff as fresh evidence, finding it failed the Ladd v Marshall threshold and would not have had a material bearing on the outcome. Appeal dismissed with costs to the plaintiff, whose own costs were to be taxed according to Legal Aid Regulations.
Legal issues: Appellate review of Recorder's factual finding on transferor's intention · Resulting trust where stated consideration was not paid · Pleading of resulting trust · Presumption of advancement between mother and child · Admissibility of new evidence (1997 will) on appeal
Outcome: Appeal dismissed; the defendant's appeal against the Recorder's finding that the defendant held the properties on resulting trust for the plaintiff was dismissed.
Cited by 1 case · Cites 1 case