Citibank (Hong Kong) Ltd v. Chow Po Shan

DCCJ 2243/2014

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 2243 OF 2014

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DECISION
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1.This is the defendant’s appeal against Master CH Li’s decision made on 14 January 2015 to grant summary judgment to the plaintiff and to strike out the defendant’s counterclaim.

2.The plaintiff claims against the defendant for outstanding credit card sums in the total of $109,989.19 (as at the date of the Writ) plus interest.  The defendant does not dispute the plaintiff issued her with a VISA credit card in the number of 4028-5600-0260-0164 (“the Credit Card”) and that she made use of the Credit Card.

3.The defendant raises the following defences:-

(a)In the 3 letters she sent to the plaintiff dated 11 February 2014, 21 February 2014 and 3 March 2014, the defendant gave the plaintiff 10 days to reply to her letters, failing which the plaintiff is deemed to have agreed to, inter alia, the following: (1) That the debt did not exist OR the debt has already been paid in full; and (2) The plaintiff will no longer pursue the matter any further.

By reason of the plaintiff’s failure to answer the defendant’s request for verification documents on the debt, the plaintiff is deemed to have “tacitly agreed” that the debt did not exist or the debt has been waived in full (see paragraph 2(b) of the Defence).

(b) The plaintiff is unable to prove “the alleged liability exists in the form of a verified true bill signed by the plaintiff and charged to Po Shan Chow™ pursuant to Cap 19 Bills of Exchange Ordinance” (see paragraph 10 Defence).

(c)The plaintiff is unable to prove they have the lawful right and authority to enforce the collection of the debt “in the form of proof of agency” (see paragraph 11 Defence).

(d) By reason of the plaintiff’s failure to provide verification documents of the debt as requested by the defendant in her 3 letters, the plaintiff created a “permanent irrevocable estoppel by acquiescence, forever barring the plaintiff from bring any claims against the defendant” (see paragraph 12 Defence).

(e)The defendant has not exhausted all administrative remedies.

4.It is trite law that appeal from a master to a judge in chambers is conducted by way of rehearing. 

5.I have read the defendant’s affirmation and have considered the grounds of appeal set out therein.  Since I am not bound by the master’s decision, I shall deal with the merits of the plaintiff’s application as if the matter were before me for the first time.

6.The test in determining whether summary judgment ought to be given is: whether there is a triable issue or question or that for some other reason there ought to be a trial (see paragraph 14/4/9 Hong Kong Civil Procedure 2015).

7.In considering whether there is a triable issue, the court is to determine whether there is a fair or reasonable probability of the defendant having a real or bona fide defence.

Tacit agreement and estoppel by acquiescence

8.Firstly, there is no such thing as an “estoppel by acquiescence”. “Estoppel” and Acquiescence” are two distinct matters.

9.As set out in paragraph 12-004 Snell’s Equity (33^rd Ed), “the essence of a true estoppel is simply that a party is stopped from denying the truth of a particular state of affairs.”

10.Acquiescence is succinctly defined in Halsbury’s Laws of Hong Kong paragraph [165.246], Vol 26 (2^nd ed) as follows: “The term ‘acquiescence’ is used where a person refrains from seeking redress when there is brought to his notice a violation of his rights of which he did not know at the time.”

11.Secondly, the facts pleaded in the Defence do not amount to either estoppel or acquiescence. The plaintiff provided a timely response to the defendant’s 3 letters.  Furthermore, in the letter dated 20 March 2014, the plaintiff expressly denied they would agree to any terms of agreement as proposed by the defendant. 

12.Thirdly, I know of no principle of law or legal authority which permits the defendant to “deem” there to be a binding agreement between the parties by reason of the plaintiff’s failure to comply with a request which they were under no duty to entertain. 

13.I therefore do not find the defence of “tacit agreement” and “estoppel by acquiescence” as pleaded by the defendant to be a real or bona fide defence.

Failure to provide original contract signed by the defendant and other verification documents of the debt

14.The defendant admits she was issued with the Credit Card and in open court admitted that she had received money through the Credit Card to spend. She further admitted in open court she did not dispute the sum claimed by the plaintiff, subject to the plaintiff’s provision of the documents she requested in her 3 letters and the proof of the debt.

15.There is no contractual obligation on the plaintiff to provide original copies of the documents requested by the defendant before a claim for outstanding sums can be made.  In any event, the plaintiff has provided sufficient documentary proof of the claim by exhibiting the defendant’s monthly credit card statements (see Exhibit B, Affirmation of Lee Shing Keung).

16.I therefore do not find this complaint of the defendant to amount to a real or bona fide defence.

The plaintiff’s failure to prove the debt exists as a “verified true bill” pursuant to the Bills of Exchange Ordinance

17.This defence is misconceived and erroneous.  The Bills of Exchange Ordinance has no application in this case involving credit cards.  There is no real or bona fide defence on this ground.

The plaintiff’s failure to prove their lawful right and authority to enforce the collection of the debt “in the form of proof of agency”

18.Paragraphs 6.1 and 6.2 of the “Citibank Credit Card Agreement.  Terms and Conditions” clearly stipulate the plaintiff has the right to receive and collect all outstanding sums incurred by the defendant. There is no real or bona fide defence raised on this ground.

Failure of the defendant to exhaust all administrative remedies

19.The exhaustion of all “administrative remedies” is not a defence to contractual claims of debt.  Hence this is not a defence to the plaintiff’s claim against the defendant.

Additional arguments raised in the appeal hearing

20.At the appeal hearing, the defendant raised the following additional arguments:-

(a) There is no proof that Lee Shing Keung, the deponent of the plaintiff’s supporting affirmation, has first-hand knowledge of the matters and therefore he is not a competent witness of fact.

(b) The plaintiff is put to strict proof on all aspects of their claim.

21.The defendant submits that by reason of the above and the points raised in her Defence, the court has no subject matter jurisdiction in this matter.

22.Regarding the competency of Lee Shing Keung as a deponent, I find no merit in this submission.  Mr Lee is the plaintiff’s manager and has been duly authorised by the plaintiff to make the affirmation on its behalf. He is therefore the appropriate and proper person in Citibank to depose to the matters set out in the affirmation.

23.Regarding the submission the plaintiff is put to strict proof, this does not assist the defendant’s appeal.  I have already set out the test for determining whether a summary judgment should be granted.  Placing the plaintiff on strict proof does not answer the question whether the defendant has a real or bona fide defence.

24.As for the submission relating to subject matter jurisdiction, the defendant’s submissions are misconceived and erroneous.  The plaintiff is entitled to make an application to a master for summary judgment and striking out.  The master below had jurisdiction over the matter.

25.By reason of the matters set out above, there is no real or bona fide defence raised by the defendant and therefore there is no triable issue demonstrated by the defendant. Furthermore, I can find no other reason for this case to proceed to trial.  

Striking out of the defendant’s counterclaim

26.Having read the defendant’s Defence and Counterclaim, I find she has failed to disclose any reasonable cause of action. Hence her “counterclaim” should be struck out.

Summary

27.For reasons given herein, I dismiss the defendant’s appeal against the master’s judgment for the plaintiff and I dismiss the defendant’s application for a stay of execution on the said judgment.  The master’s judgment shall stand.

28.I make a costs order nisi that the defendant shall pay the plaintiff’s costs of this application to be taxed if not agreed. Unless any party applies to vary the costs order within 14 days hereof, the costs order shall become an order absolute.

Mr Cheung Sai Wah, of Foo and Li, for the plaintiff

The defendant appeared in person