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HCMP1596/2008
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
MISCELLANEOUS PROCEEDINGS NO. 1596 OF 2008
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IN THE MATTER OF all those pieces or parcels of ground registered in the Land Registry as one equal undivided moiety or half part or share of 1/96th part or share of and in the Remaining Portion of Section A of Marine Lot No.365, the Remaining Portion of Section C of Marine Lot No.365 and the Remaining Portion of Sub-section 1 of Section W of Inland Lot No.29 (Front Portion of 8th Floor, No. 58 Percival Street, Hong Kong)
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and |
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IN THE MATTER OF Order 113 of the Rules of High Court, Cap. 4, Laws of Hong Kong
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BETWEEN
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CHAN GORDON |
Plaintiff |
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and |
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LEE WAI HING （李慧馨）
LI PO KWONG （李寶光）ALIAS
LEE PO KWONG（李寶光） |
1st Defendant
2nd Defendant |
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Before : Deputy High Court Judge Au-Yeung in Court
Dates of Hearing : 17 – 18 January 2011
Date of Judgment : 1 March 2011
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JUDGMENT
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1. This is a contest between the administrator of a deceased father and the daughter over a residential property (“the property”) and monies in a bank account (“the savings”).
UNDISPUTED FACTS
2. The plaintiff, a solicitor, is the administrator (“the administrator”) of the estate of the late Mr. Lee Kar-kwong (“the father”) and that of his lawful brother the late Mr. Lee Kwok-kwong (“the uncle”). The lawful widow of the father is Madam Liu (“the wife”), a PRC resident.
3. The 1st defendant (“the daughter”) is the only daughter born of the father and one Madam Tam.
4. The 2nd defendant (“the 5th uncle”) is the half-brother of the father and the uncle. The claim against him has been discontinued but he remained as a witness for the daughter.
5. The property was acquired in the joint names of the father and the uncle as tenants-in-common in equal shares in 1964.
6. Since 1974, the father and Madam Tam had been residing at the property. The Plaintiff was born in that year. In 1994, Madam Tam passed away.
7. On 21 February 1999, the uncle died intestate. The father, being his natural and lawful brother, was the only person entitled to his estate.
8. In May 2004, the father married the wife in Mainland China.
9. On 23 December 2004, letters of administration of the estate of the uncle was granted to the father.
10. On 11 January 2005, the father died at the age of 73, without administering the estate of the uncle. The father’s estate comprised the property and the savings of some HK$115,602.63 in his bank account. The only beneficiaries are Madam Liu and/or the daughter.
11. On 25 January 2008, the plaintiff, having applied as attorney of the wife, became the administrator of the father’s estate. On 30 June 2008, the plaintiff obtained letters of administration de bonis non for the uncle’s estate.
THE DAUGHTER’S CASE
12. The daughter claimed that she had expended money or otherwise acted to her detriment in the belief that she would become the absolute owner of the property. The father and the uncle had encouraged or acquiesced in the same and it would be unconscionable for the administrator to recover possession from her. She based her claim on: (A) proprietary estoppel, (B) common intention constructive trust and irrevocable licence protected by constructive trust, (C) the doctrine of unconscionability set out in Pennington v. Waine [2002] 1 WLR 2075 and (D) donatio mortis causa. She also alleges that the father’s savings were held on: (E) resulting trust for her.
13. The property was purchased by the great-grandmother of the daughter for the descendants of the Lee family. It was in the joint names of the father and the uncle because the uncle was deaf and dumb since birth and the father promised to take care of him.
14. The daughter has been residing at the property since birth. She ceased studying in 1992 and started working in 1993. Since 1996, she has been working as a waitress with different restaurants. In that year, the father, then aged 65, retired. The daughter claimed that on several occasions in about 1996, the father represented to her that she could reside in the property for the rest of her life for free provided that she maintained the family. In reliance on those representations, the daughter substantially increased her monthly maintenance for the support of the father and the uncle until their respective death and incurred costs on repair of the building to which the property formed part. The pattern over the years was as follows:
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Year |
Income per month |
Maintenance to father |
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1996 |
$9,000 |
$2,000 pm + $100 per day for food |
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1997 |
$10,000 |
$3,000 pm + $100 per day for food |
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1999 |
$10,000 |
$4,000 pm + $50 per day for food as the uncle died |
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2001 |
$9,000 |
$5,000 pm |
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2003 |
$9,000 |
$5,500 pm |
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2004-5 |
$9,500 |
$6,000 pm |
15. Whilst the uncle was alive, the father shared the maintenance with him. In addition, the daughter paid about $1,000 for the outgoings and miscellaneous expenses like dog food, shampoo. Those monthly maintenance took up 2/3 (about $6,000 to $7,000) of her income. She would also hand over any tips received to the father.
16. Throughout the years, the 5th uncle had repeatedly reminded the father (at gatherings of the extended family) during Chinese New Year, Ching Ming and Chung Yeung Festivals that he should transfer the property to the daughter. The father, the uncle and 5th uncle repeated their intention that the property would belong to the daughter.
17. In about 1999 when the uncle died, the father told the daughter again that at the end of the day, the property would belong to her and promised to transfer the property to her.
18. On one occasion between 1994 and 2000, the father told the ex-boyfriend of the daughter (“the ex-boyfriend”) that he should take good care of the daughter and that the property would be given to her.
19. The father got married in May 2004. The daughter learnt about it one evening when she saw the father looking sadly at the marriage certificate. He told her that he might be cheated and that he wanted to transfer the property to her as soon as possible. He said he regarded the natural relationship with the daughter as the most important and promised to leave everything to her.
20. In about June 2004, the father delivered the title deeds to Messrs. Pang & Associates with a view to effecting a transfer to the daughter.
21. The daughter later learnt from the father that one Mr Yiu, solicitor of Messrs. Pang & Associates, advised him that transfer of the property to her by way of gift might create difficulties in terms of raising loans on the security of the property in future; and that it would be better to effect the transfer by means of a purported sale and purchase (“the legal advice”). Therefore the father told Mr Yiu that the price should be $500,000 but he would not really charge the daughter. The father also learnt that the property was not held by him and the uncle as joint tenants but as tenants-in-common. Therefore, through Messrs. Pang & Associates, the father applied for and was granted the letters of administration for the uncle’s estate.
22. Sadly, within 3 weeks of such grant, the father suffered from suspected colon problem on 11 January 2005 and was sent to hospital. Before the operation, the father allegedly passed the property to the daughter and told her that she and the puppy could live there. He told her to consult Mr Yiu. The father died on the same day.
THE ADMINISTRATOR’S CASE
23. The administrator effectively put the daughter to strict proof and denied each head of the daughter’s claim. In particular, he relied on the fact that any alleged intention of the father and the uncle to transfer the property to the daughter for free was rebutted and negated by the clear instructions of the father to Messrs. Pang & Associates to prepare a conveyance for the sale of the property to the daughter at a consideration of HK$500,000.
ASSESSMENT OF CREDIBILITY OF WITNESSES
24. I have reminded myself that though the situation of the daughter attracted sympathy, the act of the administrator in seeking to enforce the strict legal rights was perfectly proper. The Court must be cautious in exercising its equitable jurisdiction. In the end, it must decide the case on the evidence and in accordance with the law.
25. The daughter’s version was based on oral promises. She has not produced contemporaneous documents of payments to the father and the source of those payments despite its forming the core of her case: Chan Chui Mee v. Mak Chi Choi [2009] 1 HKLRD 343, at para 53. The father’s bank passbook, most likely kept inside the property, was not produced in support of her case. The administrator, understandably with a view to saving costs and thinking that it was no longer necessary to provide 3 years’ bank record for estate duty purpose, had not sought the transaction history from the bank. Since the burden of proof was on the daughter, her credibility was of crucial importance
26. The daughter’s job pattern and income were simple and consistent. Her employment was continuous. The family structure and lifestyle was simple but close. There was no suggestion that the father and the uncle had independent financial means. The daughter’s narrative was borne out by the circumstantial evidence which will be further analyzed below. Having seen and heard the daughter, I find her to be an honest and credible witness and I accept her evidence.
27. The honesty of all the other...
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