Kwan So Ling v. Woo Kee Yiu Harry and Others
Read the full judgment text of HCA 1311/2011 on BabelCite. This High Court CFI judgment was delivered on 30 April 2015.
1. This action arises from a dispute over the beneficial ownership of a residential property, namely, 2/F, 180 Hai Tan Street, Sham Shui Po, Kowloon.
Cited by 9 cases · Cites 5 cases
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HCA 1311/2011 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO 1311 OF 2011 ____________
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_______________ J U D G M E N T _______________ Background 1.This action arises from a dispute over the beneficial ownership of a residential property, namely, 2/F, 180 Hai Tan Street, Sham Shui Po, Kowloon. 2.The plaintiff is the widow of the late Mr Woo Kay Sin who died in 1994. Woo Kay Sin was the second of five children of Mr Woo Wai (“Mr Woo Snr”), who died in 1998, and his wife, Woo Kam Oi (“Madam Woo”), who died in September 2012. Their other children are, in order of birth, Woo Sui Mai Helen, Woo Mui Mui Jeanie, Woo Kee Yiu Harry (who is the 1st defendant herein) and Woo Kee Dak Dack. The 2nd defendant is the son of the 1st defendant. Madam Woo’s estate and Mr Woo Snr’s estate have been joined as 3rd and 4th defendants although they were not represented and did not take part in the trial. 3.On 6 August 1963, Mr Woo Snr purchased two properties being 1/F and 2/F respectively, 180 Hai Tan Street. I shall refer to the two properties as “the 1/F property” and “the 2/F property”. 4.In about 1965, the plaintiff first met Woo Kay Sin in Hoiping, Guangdong Province, while he was there to pay respects at the shrines of his ancestors. The plaintiff fell in love with him and they got married on 5 January 1966 in the Mainland. Although Madam Woo went to see the couple at the time, no one from the plaintiff’s immediate family attended the wedding banquet. In 1966 or 1967, Mr Woo Snr, Madam Woo, Helen, the 1st defendant and Dack Woo emigrated from Hong Kong to Canada. 5.The plaintiff alleges that in around 1966, Madam Woo, on behalf of herself and Mr Woo Snr, asked the plaintiff to move to Hong Kong and promised her and Woo Kay Sin that she (ie Madam Woo) and Mr Woo Snr would give two properties (namely, the 1/F and 2/F properties) to Woo Kay Sin and the plaintiff. Madam Woo assured the plaintiff that the couple would be given one property in Hong Kong to live in and the other property to let for income, so that they could make a living without having a job. This alleged promise which is disputed by the defendants forms the central plank of the plaintiff’s case. 6.The plaintiff gave birth to a daughter in 1967 in the Mainland. At that time Mr Woo Snr and Madam Woo gave her a monthly sum of HK$300 to help with her living expenses. It is common ground that the plaintiff and her daughter moved to Hong Kong in around September 1973. The family of three initially lived with Woo Kay Sin’s maternal grandparents in Mongkok. The allowance that Mr Woo Snr and Madam Woo gave them was increased to HK$1,000 per month. 7.It appears that, in around 1974, the couple were entrusted by Mr Woo Snr with the management of the 1/F and 2/F properties. They spent several hundred dollars to partition the 2/F property into five rooms. They and their daughter moved into two of the rooms and let the rest to tenants for a total rent of about HK$600 per month. At about the same time, they also started to collect the rental income of the 1/F property totalling about HK$800 per month. 8.In 1975, by a deed of gift, Mr Woo Snr transferred the 1/F property to the plaintiff and her husband as joint tenants. Up to 1991 the 1/F property had been let to tenants. 9.In 1980 the plaintiff gave birth to a son. 10.In 1985, Mr Woo Snr and Madam Woo returned briefly to Hong Kong – apparently their only visit to Hong Kong after emigrating – and had a conversation with Woo Kay Sin and the plaintiff. According to the plaintiff, Mr Woo Snr assured them that he had not forgotten the promise previously made to them, although he had forgotten to bring the title deeds of the 2/F property with him, and that what had been given to them, ie the two properties, were theirs. This further assurance is disputed by the defendants. 11.In about 1991, Woo Kay Sin, the plaintiff and their children moved from the 2/F property to live in the 1/F property. The whole of the 2/F property was then let to tenants. 12.In 1994, Woo Kay Sin died intestate in Hong Kong. 13.In March 1998, Mr Woo Snr died intestate in Canada. In August 1998, Madam Woo instructed solicitors in Hong Kong to apply for letters of administration in respect of Mr Woo Snr’s immovable property in Hong Kong. 14.In 2001, the plaintiff’s son purchased a flat in Ma On Shan. The plaintiff began to stay there with her son from time to time. In around 2010, she moved out of the 1/F property completely and let it also to tenants. She has since lived with her son in Ma On Shan. 15.On 20 May 2008, letters of administration of the estate of Mr Woo Snr, limited to his immovable property in Hong Kong, were finally granted by the High Court. The only property listed in the attached schedule of property, in respect of which estate duty had been exempted, was the 2/F property with a stated value of HK$650,000. 16.On 5 November 2008, Madam Woo suffered a fall and was admitted to hospital in Canada. On 22 November, in her capacity as administratrix of the estate of Mr Woo Snr, she executed an assignment of the 2/F property to the 2nd defendant for a stated consideration of HK$500,000 (“the 2008 assignment”). It is common ground that no such or any other consideration was in fact paid. In around late 2008 or early 2009, Madam Woo was diagnosed as suffering from dementia. In January 2009 she was admitted to an elderly home and then transferred to a hospital in March 2009. 17.On 2 August 2011, the plaintiff commenced this action to assert ownership of or an interest in the 2/F property. The 1st and 2nd defendants deny that the plaintiff has any interest except a licence to use the 2/F property. By a letter in October 2011, the 2nd defendant revoked his permission for the plaintiff to remain in possession of the 2/F property. Madam Woo died in Canada in September 2012. 18.It is not in dispute that since 1974, the plaintiff has managed the affairs of both the 1/F and 2/F properties, received the rent and paid all outgoings. The plaintiff’s claims 19.The plaintiff claims, primarily, a declaration that she is the sole beneficial owner of the 2/F property and an order that the 2nd defendant execute a conveyance of the 2/F property to her. She also claims, alternatively, a declaration that she has a licence to occupy or possess the 2/F property during her lifetime. 20.The causes of action relied upon by the plaintiff are common intention constructive trust and proprietary estoppel. Put broadly, her case is that there was a common intention between Mr Woo Snr and Madam Woo on the one hand, and the plaintiff and her husband on the other, alternatively an assurance or representation by the former to the latter, that the plaintiff and her husband were jointly and beneficially entitled to the 2/F property, and that she acted in reliance on this common intention or assurance to her detriment. She contends that it would be inequitable and unconscionable for the 2nd defendant, as successor-in-title to Mr Woo Snr as legal owner, to claim the property and deny her interest in it. 21.In the pleadings, the plaintiff also claims that Madam Woo lacked any requisite mental capacity to execute the 2008 assignment and seeks an order to set it aside. I had some problem with that claim as such since if it was an independent claim impugning the validity of the 2008 assignment alone, it ought to be brought by the personal representative of Mr Woo Snr’s estate, not by the plaintiff. It was, however, clarified in the opening by Mr Jason Wong, who appeared on behalf of the plaintiff, that while the plaintiff avers that Madam Woo lacked mental capacity, she does not raise this as an independent cause of action. He confirmed that if the plaintiff fails on constructive trust and proprietary estoppel, she makes no separate claim to set aside the 2008 assignment for want of mental capacity on the part of Madam Woo. The mental state of Madam Woo at the relevant time, of course, remains relevant to the evidential effect of the 2008 assignment. There is further a pleaded claim of adverse possession but Mr Wong also made clear in opening that it is not pursued. The defendants’ case 22.The defendants deny the plaintiff’s case. The 1st defendant advances a positive case that it was the intention of Mr Woo Snr and Madam Woo for Woo Kay Sin and his family to have the 1/F property and for the 1st defendant’s and his family to have the 2/F property. The 1st defendant has decided that his son the 2nd defendant should take the legal and beneficial ownership of the 2/F property, hence the assignment by Madam Woo to the 2nd defendant in 2008. After the assignment, the 2nd defendant continued to permit the plaintiff to use the 2/F property until the plaintiff commenced this litigation. By his counterclaim the 2nd defendant claims vacant possession of the 2/F property and mesne profits, although Mr Albert Cheung, who appeared for the defendants, made clear at trial that only a nominal sum is sought. The applicable legal approach 23.The legal principles applicable to common intention constructive trust are not in dispute between the parties. I have been referred to the leading English cases of Jones v Kernott [2012] 1 AC 776 and Stack v Dowden [2007] 2 AC 432 as well as recent local cases such as Mo Ying v Brillex Development Ltd [2014] 3 HKLRD 224 and a decision of my own in Liu Wai Keung v Liu Wai Man [2013] 5 HKLRD 9. Two features of the plaintiff’s case of constructive trust are to be noted: first, the common intention is said to have been formed not upon acquisition of the property by Mr Woo Snr in 1963, but several years later in around 1966; secondly, the common intention is not that the plaintiff and her husband should have a share of the beneficial ownership but that they jointly (and now the plaintiff alone) should have the whole beneficial ownership of the 2/F property. To establish the constructive trust, therefore, the plaintiff has to prove: (i) a common intention between Mr Woo Snr and Madam Woo on the one hand, and the plaintiff and her husband on the other, formed and communicated in around 1966, that the latter were to be given the entire beneficial ownership of the 2/F property; (ii) that the plaintiff and her husband acted or changed their position to their detriment in reliance on the common intention; and (iii) it would be unconscionable for Mr Woo Snr’s estate, or the 2nd defendant as successor-in-title, now to deny the plaintiff’s right in the 2/F property in accordance with the common intention. 24.In this connection Mr Cheung draws attention to the following passage in Lord Neuberger’s speech in Stack v Dowden [2007] 2 AC 432 at 475, §138:
Mr Cheung also refers me to an analogous passage in Ip Man Shan Henry v Ching Hing Construction Co Ltd [2003] 1 HKC 256[1] at §74. I do not however think that these passages are in point here. The plaintiff’s case here is an agreement, arrangement or understanding reached between the parties with respect to the beneficial ownership of the property concerned based on evidence of express and specific discussions and assurances. I can see that in some cases, where there is no evidence to support a finding of such an agreement or arrangement, the court may be asked to infer from the conduct of the parties the relevant common intention: Lloyds Bank v Rosset [1991] 1 AC 107, 132-133. But as I understand Mr Wong’s submissions in this case, he did not suggest that if I should reject the plaintiff’s evidence and case of an express promise, I should nonetheless infer a common intention to the same effect. Nor is there any pleaded material from which any such inference may be made if the case of express promise is rejected. 25.In the context of the present case the elements of proprietary estoppel are similar to those for constructive trust. Broadly speaking the doctrine is based on three main elements: a representation or assurance made to the plaintiff; reliance on it by the plaintiff; and detriment to the plaintiff in consequence of his reliance: Thorner v Major [2009] 1 WLR 776 at §29, per Lord Walker. The three elements are not however rigidly compartmentalised. Thus Robert Walker LJ said in Gillett v Holt [2001] Ch 210 at 225C:
26.An important difference from constructive trust is that if a plaintiff has established his claim to equitable relief by virtue of proprietary estoppel, there may be a range of relief that the court can award in order to satisfy the equity, with the approach being to achieve “the minimum equity to do justice to the plaintiff”: Gillett v Holt, supra, p 235E. The issues 27.On the basis of the parties’ cases, two primary issues emerge:
Whether the alleged promise was made 28.The plaintiff was born in 1946 in Hoi Ping, Guangdong Province. In 1965, she was in senior secondary school with only one term left before graduation. She had never been to Hong Kong at that time. During the spring of that year, she met Woo Kay Sin in Hoi Ping, who was then a young man 24 years of age. He had a drug addiction and no formal employment though he apparently did some work for his father’s factory in Hong Kong. He was in Hoi Ping at that time with a distant relative to pay respects to his ancestors. The plaintiff came to know that he was from Hong Kong with a well-off background, and they began seeing each other. 29.The plaintiff said she met Madam Woo for the first time in the summer of 1965 in Hoi Ping, when she gave her consent for Woo Kay Sin to date the plaintiff. The plaintiff said that Madam Woo went to Hoi Ping a second time in early 1966, when the plaintiff and Woo Kay Sin got married at the registry. There was a subsequent banquet held in Hoi Ping which Madam Woo did not attend. No one else from the Woo family attended the wedding. 30.The plaintiff said that during Madam Woo’s second visit to Hoi Ping, when the plaintiff was getting married, she told the plaintiff that Woo Kay Sin was a drug addict, but that she need not worry because his parents, ie Mr Woo Snr and Madam Woo, would provide for them. In particular, the plaintiff said that Madam Woo told her that they had had many properties though only the two properties in Hai Tan Street remained unsold, and that the two properties would be given to Woo Kay Sin and the plaintiff. Madam Woo asked the plaintiff to move to Hong Kong. 31.In her witness statement which was adopted as her evidence in chief, the promise was put in these terms:
32.The plaintiff said that her parents-in-law repeated the assurance to her in 1985, when they came back to Hong Kong for a visit. Mr Woo Snr assured the plaintiff and her husband that he had not forgotten the promise, although he had forgotten to bring the title deeds with him so he was unable to complete the formality of the transfer of the 2/F property to them. He assured the couple that the 2/F property was theirs, and told them that even without a formal transfer, after they lived in that property for another ten years or so, it would be recognised as theirs under Hong Kong law. 33.The crucial question is whether the plaintiff’s evidence should be accepted. The plaintiff has not produced any documentary evidence that supports these assurances. Despite her evidence that she and Mr Woo Snr had exchanged many letters, none was adduced in evidence. There is in evidence a written request by the plaintiff in 2000 to the Inland Revenue Department for a duplicate tax return to be issued to her in relation to the 2/F. She wrote in the form that since 1974 the 2/F property had been handled by her and her husband, that her father-in-law had never charged them any rent, and that her father-in-law had emigrated to and died in Canada. The letter sheds little light on the issues in this case and neither party has placed much reliance on it. The sole support of the plaintiff’s claim is her own testimony. 34.In approaching the plaintiff’s evidence, I remind myself that caution is needed since she is in effect alleging a gift or the promise of a gift to her by persons who are now deceased; she is making allegations of promises and assurances by Mr Woo Snr and Madam Woo neither of whom is alive. When these allegations were first made by the plaintiff in 2011, Madam Woo had already lost her mental capacity. In these circumstances great care is called for when assessing the plaintiff’s assertions. As Lord Walker of Gestingthorpe NPJ stated in Yung Shu Wu v Vivienne Sung Wu (2011) 14 HKCFAR 39 at §73:
His Lordship referred again at §76 to this as “the special burden assumed by a person claiming to be a donee under a gift made by a deceased person”. See also In re Finch (1883) 23 Ch D 267 and In re Garnett (1885) 31 Ch D 1, 8. 35.The undisputed fact is that in June 1975, less than two years after the plaintiff came to Hong Kong, Mr Woo Snr executed a deed of gift of the 1/F property in favour of the plaintiff and her husband as joint tenants. While in Canada, he instructed solicitors in Hong Kong to prepare the deed, had it sent to Canada, executed it before a notary public in Canada and sent it back to Hong Kong. The plaintiff and Woo Kay Sin were then told to go to a solicitors’ office in Hong Kong to execute the deed as the donees. The deed was subsequently duly stamped and registered, and returned to Mr Woo Snr. The whole process took at least half a year. The deed stated that Mr Woo Snr was “desirous of making a gift to … his son and daughter-in-law” and the assignment was made “in consideration of his love and affection” for them. The obvious question that arises is this: if Mr Woo Snr and Madam Woo had in fact promised the plaintiff and Woo Kay Sin, and all of them had a common intention, that both the 1/F and 2/F properties were theirs, why would Mr Woo Snr take steps to transfer only the 1/F property to them in 1975? Why did he not take steps at the same time to transfer the 2/F property to them as well? There is ultimately no satisfactory answer to this question. The plaintiff did not profess to know, and she said she did not ask her father-in-law because she respected his decision. 36.In my view, the inexplicable absence of a similar transfer of the 2/F property in 1975, when Mr Woo Snr went through an elaborate formal process of transferring the 1/F property, militates against the plaintiff’s evidence. On her case, there was to his knowledge no relevant difference between the two properties, such that Mr Woo Snr should convey one of them to the couple but not the other. Inferentially, this evidence supports an intention, a deliberate decision, on the part of Mr Woo Snr in 1975 not to transfer the 2/F property to his son and daughter-in-law. 37.If the plaintiff’s version was correct, the omission in 1975 was erroneous, and something that Mr Woo Snr would wish to correct. The plaintiff said, in effect, that Mr Woo Snr did wish to rectify the omission when he returned to Hong Kong in 1985, but could not make a transfer because he had forgotten to bring with him the title deeds of the 2/F property to Hong Kong. I find the plaintiff’s version of that incident hard to believe. She said that according to Mr Woo Snr, he came back to Hong Kong in 1985 to visit them and do “two most important things”, one relating to certain shares and the other being the transfer of the 2/F property to them. Yet he also told her that he had forgotten to bring the title deeds. I find it inherently improbable that he would have forgotten it if he considered it a “most important thing”. In any event the title deeds were not essential for making a gift, and Mr Woo Snr should know that since he had done a similar transfer of the 1/F property while staying in Canada. All he needed to do was to have a deed of gift of the 2/F property prepared and executed as he had done in 1975 in relation to the 1/F property. Even if he did think that he could not complete all the legal formalities during that visit, there was no reason why he would not have started the process, such as by instructing solicitors to prepare the necessary documentation. Nor was there any reason why he could not have procured a transfer soon after returning to Canada, in the same way as he transferred the 1/F property. 38.The plaintiff tried to address that by suggesting that in 1985, Mr Woo Snr told them that even without a deed of transfer, the property would be recognised by law as belonging to the plaintiff and her husband after another 10 years or so. The plaintiff said that Mr Woo Snr expressly mentioned that by that time, even if the 1st defendant or Dack Woo wanted to contest for the 2/F property, they would not succeed, because the plaintiff would have lived there for over 20 years. That was an erroneous view of the law, and there is nothing to suggest why Mr Woo Snr would hold that mistaken belief. Further, if that conversation had taken place and it had indeed crossed Mr Woo Snr’s mind that there could be a fight for the property within the family (which was not mentioned in the plaintiff’s witness statement), it would be all the more improbable for him not to have made a formal inter vivos transfer of the 2/F property to Woo Kay Sin and the plaintiff then, or at least expressly left it to them in his will. 39.If there was a common intention for Woo Kay Sin and the plaintiff to have the 2/F property beneficially, it is difficult to see why Mr Woo Snr did not cause a transfer to be made to them jointly or, after his son died in 1994, to the plaintiff alone, up to his death in 1998. The fact is that he never took steps to make such transfer. Equally, he left no will to bequeath the 2/F property to Woo Kay Sin (who in the event predeceased him) or to the plaintiff. 40.In cross-examination, the plaintiff said, without prompting, that Madam Woo had told her in 1965 or 1966 that the 1/F property had been purchased for Woo Kay Sin’s marriage to her. However, since the 1/F property was in fact acquired by Mr Woo Snr in 1963, before the plaintiff even met Woo Kay Sin, it could at most have been bought for Woo Kay Sin when he got married. That would be consistent with the fact that Mr Woo Snr did subsequently transfer the property to Woo Kay Sin and the plaintiff. What is telling is that the plaintiff did not at first say that she was told that the 2/F property had also been purchased by Mr Woo Snr for Woo Kay Sin’s marriage. Although the plaintiff later tried to say that Madam Woo also told her that the 2/F property was likewise acquired for Woo Kay Sin’s marriage to the plaintiff, the answer was self-serving and lacked spontaneity. 41.When asked about the repetition of the assurance in 1985, the plaintiff also said that her parents-in-law told her family during the visit in 1985 that they (ie the parents-in-law) would give the 2/F property to the plaintiff’s son, who was born in 1980. In my view this is inconsistent with the suggestion that the parents had already given the property to the plaintiff and Woo Kay Sin. 42.The plaintiff stated that Mr Woo Snr also told her and her husband in 1985 that while his properties in Canada would be given to his two sons in Canada, i.e. the 1st defendant and Dack Woo, his Hong Kong properties would be given to Woo Kay Sin and the plaintiff. However, the plaintiff also gave evidence that Mr Woo Snr owned an additional property in No. 170 Hai Tan Street which he sold in 1988. The proceeds of sale were not in any way given to Woo Kay Sin or the plaintiff. In my view this also throws doubt on the plaintiff’s version of the conversation in 1985. 43.According to the plaintiff, her daughter, who was 18 at the time, was present when Mr Woo Snr made the assurances in question in 1985. When cross-examined, the plaintiff at first said she did not know how much her daughter had heard of the conversation, but later said that she heard the promises and assurances “very clearly”. Inexplicably, she was not called by the plaintiff to give evidence (even though she accompanied the plaintiff in court during the trial), which was all the more surprising in the light of the well-established rule of prudence I have referred to above, that in a claim against a deceased person’s estate, the court would approach the unsupported testimony of the plaintiff with great care. In these circumstances, applying the principles set out in Pacific Electric Wire & Cable Co Ltd v Texan Management Ltd (CACV 90-91, 93-96/2012; 17 September 2013) at §§105-107, I consider that the failure to call the daughter weakens the evidence given by the plaintiff herself in this respect. 44.Because of all these inherent problems in her evidence, I am not persuaded, even looking at the plaintiff’s evidence alone, that there was a promise for the plaintiff and Woo Kay Sin to own the 2/F property as the plaintiff alleges. 45.Moreover, the plaintiff’s evidence about the intention of Mr Woo Snr and Madam Woo is contradicted by the evidence of the 1st defendant and Dack Woo. While the parents were initially content for Woo Kay Sin to live in one of the 1/F and 2/F properties and for the other property to be let for income to maintain him, both the 1st defendant and Dack Woo confirm that their parents’ intention, as they understood from their parents, was for Woo Kay Sin and his branch of the family to become owners of the 1/F property and for the 1st defendant’s branch of the family to become owners of the 2/F property. 46.I accept the defendants’ evidence in this respect. Obviously there is a tie of kinship between them but Dack Woo had no direct personal benefit to gain by supporting the 1st defendant’s case. He gave his evidence in a straightforward manner and I accept him as a witness of truth. His memory of the 1985 visit to Hong Kong was hazy, and he did not purport to deny specifically the plaintiff’s assertion that the promise was repeated by the parents-in-law in 1985. He said he had understood from his parents that the 2/F property was intended for the 1st defendant, which I accept. As to the 1st defendant, I have reservations about his evidence on the timing of the health problems of Madam Woo because he seemed confused about the timing and perhaps because he was sensitive to the fact that the assignment was close in time to Madam Woo’s admission into a care home. I accept however his evidence regarding his parents’ intention for his branch of the family to become owners of the 2/F property which is corroborated by Dack Woo’s evidence. The 1st defendant was the one who handled the application for grant of representation of Mr Woo Snr’s estate in Hong Kong to Madam Woo as administratrix. It is likely that Madam Woo had discussed the 2/F property with the 1st defendant which was the only asset in Hong Kong in the estate. 47.The assignment signed by Madam Woo dated 22 November 2008 is also on its face against the plaintiff’s case, but I place little weight on it as a piece of evidence because there is sufficient doubt, as it seems to me on the limited evidence, whether Madam Woo was fully in possession of her mental faculties at that point. The admission papers of the elderly care home show that by January 2009 Madam Woo was already recorded as having been diagnosed with dementia. So even if she had sufficient capacity as at 5 November 2008 to execute the assignment so that it is valid as a legal document to transfer the legal estate in the 2/F property to the 2nd defendant, I do not rely on it as evidence against the contrary common intention alleged by the plaintiff in this case. 48.The plaintiff has also asserted that there was an incident in 2002 when the 1st defendant returned briefly to Hong Kong and visited the 1/F and 2/F properties. She said that on that occasion the 1st defendant told her that he recognised that both properties were hers. I do not accept the plaintiff’s evidence of that conversation. 49.Having evaluated all the evidence, while I accept that Mr Woo Snr and Madam Woo did intend that Woo Kay Sin and the plaintiff should become owners of the 1/F property, I do not accept the plaintiff’s evidence that they also intended them to have the 2/F property as full beneficial owners, or that they promised that both properties would be given to them. There was probably a consensus, at least by about 1974, that given Woo Kay Sin was an opium addict and the plaintiff was new to Hong Kong at the time, their family could for the time being live in one property and live on the rental income derived from the other. The decision was made by Mr Woo Snr in 1975 to give the 1/F property to the couple and he took steps to effect a formal transfer. He was content, meanwhile, that they could live in one and use the other property for rental income. There was no promise, however, that this would continue either forever, or for as long as the plaintiff lives (which is not supported by the plaintiff’s evidence in any event). I do not accept that the plaintiff’s parents-in-law gave her to understand that her family would become owners of both properties or that she would be entitled, for as long as she lives, to occupy or let out both properties. Whether the plaintiff suffered detriment 50.On the basis of my conclusion above, the plaintiff’s case on both constructive trust and proprietary estoppel has to fail. In case I am wrong I shall consider briefly the question whether the plaintiff has established detriment. It is not in dispute that detriment is required in order to establish the plaintiff’s case. So far as proprietary estoppel is concerned, Mr Wong referred me to the following passage in Gillett v Holt, supra:
51.Mr Wong also submitted, based on Gillett v Holt, that once it is established that promises were made, and that there has been conduct by the plaintiff of such a nature that inducement may be inferred, then the burden of proof shifts to the defendants to establish that the plaintiff did not rely on the promises. He also reminded me that the matter should be looked at in the round, and not by too narrowly focussing on financial advantages and disadvantages. 52.The acts relied upon by the plaintiff fall into two categories. First, the plaintiff says she made certain personal decisions on the faith of Madam Woo’s promise in 1965 or 1966 which changed her life. In particular, she left her parents and siblings in Mainland China and came to Hong Kong in 1973. Secondly, the plaintiff relies on the effort and money expended in renovating, repairing and maintaining the 2/F over the years and also in paying all management fees, Government rent, rates and other outgoings and expenses. 53.The second aspect can be quickly disposed of. The plaintiff spent several hundred dollars in around 1974 to partition the 2/F property into five rooms. That however enabled her to obtain rental income of $600 per month (for three of the five rooms). When the plaintiff’s family moved to live in the 1/F property and began to let out the whole of the 2/F in 1991, the rental income from that property would be even higher. By now the plaintiff has lived in the 2/F property or let it for rental income for some 40 years. She no longer lives there and is letting both properties, as sub-divided and partitioned, to tenants. She admitted in cross-examination that she had appropriated the entire rental income from the two properties over the years which exceeded the expenses she incurred, had made a significant profit and accumulated considerable savings as a result after feeding the family and raising two children both of whom have become independent for many years. The daughter lives in Taiwan with her husband and the son has purchased his own flat in Ma On Shan as early as 2001, with financial assistance from the plaintiff. In my view the expenses and outgoings were clearly incurred either for the plaintiff’s family to reside in the 2/F property or to enable it to be let for rent enuring to the benefit of the plaintiff’s family, and were more than compensated for by the income. In these circumstances I do not think such expenditure amounted to sufficient detriment for present purposes: Chan Gordon v Lee Wai Hing [2011] 2 HKLRD 506 at §§48-49. In any event, any equity arising from such expenditure has more than accounted for by the benefit that the plaintiff has derived from the 2/F property over the years. 54.As to her leaving her maiden family and coming to Hong Kong, I think it was more likely the case that the plaintiff decided to follow her husband to Hong Kong out of love and affection, rather than because of a promise of the properties. She gave evidence that she was attracted to and had fallen in love with Woo Kay Sin. There is no suggestion that she decided to marry him because of Madam Woo’s promise. Having married him, who to her knowledge was a Hong Kong resident, it was, I think, natural from her point of view then, for her to move to Hong Kong. There was no real evidence that Woo Kay Sin returned to Hong Kong because of his parents’ alleged promise. The fact that the plaintiff left her parents and siblings seems to me to have been an incidence of her marriage rather than the result of reliance on a promise by Madam Woo. Conclusion 55.For the foregoing reasons, the plaintiff’s case of constructive trust and proprietary estoppel both fail. The action must therefore be dismissed. As any licence for the plaintiff to possess the 2/F property has been terminated, she has no defence to the 2nd defendant’s claim as legal owner for possession. There will therefore be judgment on the 2nd defendant’s counterclaim for possession of the 2/F property. I think, however, that at least until the licence was terminated, the tenancies were probably created with authority. I am not prepared at this stage to order delivery of vacant possession free of tenancies. I give liberty to apply in relation to the terms of the order for possession. I also award nominal damages for trespass in the sum of $1. 56.There will also be an order nisi that the plaintiff is to pay the defendants their costs of the action and counterclaim.
Mr Jason Wong and Mr Kelvin Liu, instructed by Cham & Co, for the plaintiff Mr Albert Cheung, instructed by Lam Lee & Lai, for the 1st and 2nd defendants The 3rd and 4th defendants were not represented [1] Reiterated by Lam J in Chan Chui Mee v Mak Chi Choi Nelson [2009] 1 HKLRD 343 at §34. |
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