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CACV 187/2013
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF APPEAL
CIVIL APPEAL NO. 187 OF 2013
(ON APPEAL FROM HCA NO. 1466 OF 2010)
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BETWEEN
| SUEN SHU TAI (孫樹娣) |
Plaintiff |
| and |
| TAM FUNG TAI (譚鳳帶) |
Defendant |
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| Before : Hon Cheung, Chu JJA and Mimmie Chan J in Court |
| Date of Hearing : 19 June 2014 |
| Date of Judgment : 4 July 2014 |
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Hon Cheung JA :
The appeal
1.1 The plaintiff was the registered owner of two properties, namely, a shop situated in Che Cheung Building (‘the shop’) and a flat situated in Ha Heung Road, Kowloon (‘the flat’).
1.2 On 22 September 1999 and 5 October 1999 respectively, these two properties were transferred by the plaintiff to the defendant who is her daughter, purportedly for the consideration of $300,000 and $500,000. There was no dispute that the consideration was never paid by the defendant.
1.3 About eleven years after the transfer, the plaintiff commenced the present action seeking, among other things, a declaration that the defendant held the properties for the plaintiff.
1.4 Mr Recorder H Wong SC found for the plaintiff and held that the defendant held the properties as trustee on resulting trust for the plaintiff.
1.5 The defendant now appeals.
Facts
2.1 The plaintiff is now 87 years old (85 at trial). She was married to Mr Tam Yuk Lam (‘Mr Tam’) and gave birth to four children including the defendant. The defendant is 53 years old (51 at trial). She was married in 1984 and divorced in 1995. She has three children of her own.
2.2 The plaintiff and her four children used to live in the Mainland. Mr Tam was living in Hong Kong and had formed a union with another woman called Lou Nui who became his concubine. Mr Tam had three children from his union with Lou Nui.
2.3 In 1982, the plaintiff and the defendant came to Hong Kong and joined Mr Tam. They moved to a flat occupied by Mr Tam and his new family.
2.4 In 1986, Mr Tam purchased the flat and the plaintiff moved into this flat. By then the defendant had already moved out from Mr Tam’s home and she had never lived in the flat.
2.5 In 1994, Mr Tam was in ill health after having a stroke. In 1997, he decided to divide his properties between the plaintiff and Lou Nui. The flat which was purchased in 1986 in the joint names of Mr Tam and the plaintiff, was assigned by him to the plaintiff in August 1997. The shop which was purchased by Mr Tam in his sole name was also assigned by him to the plaintiff. He also assigned another property to Lou Nui.
2.6 After the plaintiff transferred the properties to the defendant, she continued to live in the flat. Between 2003 and 2009, she resided both in Hong Kong and the Mainland where her three sons were living. In June 2009 when she returned to Hong Kong but was unable to gain access to the flat as the locks had been changed. In August 2010 the defendant sold the flat to a purchaser for $4,316,000. The present action was commenced by the plaintiff in the following month. The defendant completed the sale in December 2011 and the proceeds of sale were held by a firm of solicitors as stakeholders.
The plaintiff’s case on the transfer
3. The Recorder summarised the plaintiff’s case on her transfer of the two properties to the defendant as follows :
‘ 24. It is the Plaintiff’s case that after Tam had transferred the Properties to her, she began to collect rent from the Properties herself, and Tam ceased to support her living. The rental income was her only source of income.
25. According to the Plaintiff, one day in early 1999 the Defendant came to see her in the Flat and showed her a letter. The Defendant told her that Tam had instructed his lawyers to claim back the Properties from her, and to transfer the same to his concubine. The Plaintiff was told that she only had 10 days to move out.
26. The Plaintiff became very worried. She told me in Court that if the Properties were taken back from her and transferred to Tam’s concubine, she would have no place in the family (“企都無地企”). The Defendant suggested to the Plaintiff that, in order to avoid Tam’s claim, she should transfer the Properties into the Defendant’s name. The Defendant told her that if the Properties were transferred into her name, Tam would not be able to recover the Properties from her.
27. According to the Plaintiff’s witness statement, which she confirmed in Court, the Defendant promised (collectively as “the alleged Promises”) her that she would support her living in the future and would give her a proper burial when she died (“生養死葬”). The Defendant further promised her that she would also hire a foreign domestic helper to look after her. In her oral evidence given in Court, the Plaintiff claimed that the Defendant had also promised to give her $3,000 per month (this is however not mentioned in either the Amended Statement of Claim or in the Plaintiff’s witness statement – rather in paragraph 17 of her witness statement, the Plaintiff mentioned that in 2007, the Defendant had promised to give her $3,000 per month if she would go back to Huidong to live).
28. The Plaintiff agreed to transfer the Properties to the Defendant. She had wanted to call her eldest son to discuss the matter but was stopped by the Defendant, who queried her for not trusting her.
29. Sometime later the Defendant took the Plaintiff to the office of a firm of solicitors in Mongkok, which was located on the 12th Floor of a building. The Plaintiff had wanted to be accompanied by her sons or a nephew, but when she mentioned this to the Defendant, the Defendant asked her if she did not trust her, and the Plaintiff accordingly did not insist.
30. At the offices of the solicitors, the Plaintiff was attended to by a Ms Wong and she was required to sign documents (which she did) that she did not quite understand. All she knew was that by transferring the Properties into the name of the Defendant, her husband could not claim back the Properties from her for transfer to his concubine. She remembered, however, that Ms Wong had told her that the price for the transfer of the Properties was $500,000 and $300,000, but it was a matter between the Plaintiff and the Defendant how the money was paid. She also said that she had never expected such money to be paid by the Defendant to her.
31. After she had transferred the Properties into the name of the Defendant, the Plaintiff continued to live in the Flat and collect rent from the tenants of the Properties. The Defendant however did not keep her promises: she had not supported the Plaintiff’s living, nor had she hired a domestic helper to take care of her.
32. It is the Plaintiff’s case the only reason why she transferred the Properties into the Defendant was to avoid the claim threatened by Tam. She did not intend to make a gift to the Defendant. She told me that she considered that the Properties still belonged to her after the transfer, even when she died (I take it to mean, in lawyers’ language, that she considered the Properties to belong to her estate upon her death).
33. The Plaintiff also alleges, as part of her case, that she had reposed trust and confidence in the Defendant. The transfer of the Properties to the Defendant was, according to the Plaintiff, manifestly disadvantageous to her. She claims that the transfer of the Properties was a result of the undue influence by the Defendant, and for that reason, is liable to be set aside.
34. Tam never in fact pursued any claim for recovery of the Properties from the Plaintiff. It is part of the Plaintiff’s case that she had relied upon what the Defendant’s represented to her (about Tam seeking to claim back the Properties for the benefit of his concubine) in transferring the Properties to the Defendant. It is alleged that the representation made by the Defendant was false, and that accordingly the Assignments should be set aside inasmuch as the Plaintiff was relying upon such misrepresentation when she executed the Assignments.
35. The Plaintiff further says that she made the transfer of the Properties in reliance on the alleged Promises made by the Defendant. As the Defendant had failed to keep her promises, she says that she is entitled to have the Assignments set aside on this ground as well.
36. Finally, the Plaintiff contends that she has a life interest in the Properties. I note that this contention was introduced by way of an amendment to the prayers of the Statement of Claim, but it is not clear from the body of the Statement of Claim what is the legal basis for the contention. Nothing was said by Ms Tjia in her Closing Submission about this contention.’
The defendant’s case on the assignment
4. The Recorder summarised the defendant’s case on the transfer as follows :
‘ 37. The Defendant’s case is quite different from the Plaintiff. She claimed that in early September 1999, her mother called her and told her that she had received a letter (in both English and Chinese) from a law firm which stated that Tam intended to claim back the Properties from the Plaintiff. The Plaintiff asked the Defendant to come to see her as soon as possible.
38. The next day the Defendant went to see the Plaintiff who showed her the letter. The Defendant recognised that the letter was from the Legal Aid Department which stated that Tam’s legal aid application had been refused. The Defendant told me in her oral evidence (when she was asked why she would relate the letter to the Properties if the letter only mentioned that Tam’s legal aid application had been refused) that the letter also stated that if Tam wanted to pursue his claim for the Properties, he would have to instruct his own private lawyers.
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