TSE MAN YIU AND OTHERS v. TSE MAN WAI AND ANOTHER
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HCMP 2557/2017
& HCA 2656/2018
[2025] HKCFI 6485
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
MISCELLANEOUS PROCEEDINGS NO 2557 OF 2017
AND ACTION NO. 2656 OF 2018
(transferred from DCCJ 2359/2018)
________________________
| IN THE MATTER of Flat 4 on 2nd Floor of Block B, Kam On Court, No.20 Hang Kam Street, Shatin, New Territories, Hong Kong | |
and | |
| IN THE MATTER of Order 15 rule 16 of the High Court Rules |
____________
| BETWEEN | ||
| TSE MAN YIU | 1st Plaintiff | |
| TSE MAN YIU, suing as the Administrator of the estate of TSE YUI MING, deceased | 2nd Plaintiff | |
| TSE MAN YIU, suing as the Administrator of the estate of MA LUEN KIU, deceased | 3rd Plaintiff | |
| TSE MAN YIU, suing as the Administrator of the estate of TSE MAN FUNG, deceased | 4th Plaintiff | |
| TSE MAN HO | 5th Plaintiff | |
and | ||
| TSE MAN WAI | 1st Defendant | |
| TSE MAN WAI, sued as the Executor of the will of TSE HUI YUET YING, deceased | 2nd Defendant | |
(Consolidated pursuant to the Order of Mr. Registrar S. Kwang dated 22nd March 2019)
____________
| Before: | Hon Au-Yeung J in Court |
| Date of Hearings: | 8-11, 14 and 17 April 2025 |
| Date of Judgment: | 31 December 2025 |
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J U D G M E N T
________________________
1. Grandmother (D2) had held the subject property in her name for 27 years until her death. She made a will devising the property to the eldest grandson (D1) and appointing him as executor. The Plaintiff’s camp (comprising the other grandsons) does not challenge the validity of the will but challenges Grandmother’s beneficial ownership and assert that their Mother and Father (who had died intestate) were the true beneficial owners, such that Grandmother had no right to dispose of the property by will to D1.
2. The causes of action of the Plaintiffs’ camp are in:
(1) Common intention constructive trust, ie that there was a common understanding reached by an oral agreementamong Grandmother, Father, Mother and an uncle, that Father and Mother would be beneficial owners of the Property; and that Father and Mother would bear the purchase price; or
(2) Resulting trust, arising from Father and Mother’s contribution to the purchase price and costs of renovation of the property.
3. The Defendants deny the claim and alleges a different common understanding, ie one among Grandmother, Father, Mother and D1 that Grandmother would be the sole legal and beneficial owner of the Property. Grandmother was to pay part of the deposit; the rest, together with the mortgage repayments would be borne by Father and D1. Father eventually failed to repay the mortgage as agreed. Instead, it was D1 who almost solely made the repayments. Grandmother made a will in recognition of the fact that the mortgage was almost entirely paid by D1. D1 counterclaims for a declaration that he is the sole beneficial owner on these bases and on resulting trust.
4. As with many cases of dispute over a property owned by a deceased senior family member, the Court is asked to decide on a state of affairs where the core figures (ie the Grandmother, Father and Mother in this case), have passed away. Insofar as the Plaintiffs’ case is concerned, the Court is asked to draw inferences based on consideration of circumstances spanning over 30 years. The difficulties for the Court to go along with the Plaintiffs can easily be contemplated.
B.UNDISPUTED OR INDISPUTABLE FACTS
5. Tse Yui Ming (“Father”) and Ma Luen Kiu (“Mother”) (collectively “the Parents”) were married in 1966. Four sons were born to them:
Tse Man Wai (“Wai”) – born in 1966, aged 21 by 1987 (year when the Property was purchased)
Tse Man Yiu (“Yiu”) – born in 1970, aged 17 by 1987
Tse Man Fung (“Fung”) – born in1973, aged 14 by 1987
Tse Man Ho (“Ho”) – born in 1977, aged 10 by 1987
6. This family is split into 2 camps in this case:
Plaintiffs’ camp
“Father”, who passed away in July 1993
“Mother”, who passed away in June 2017
“Yiu” (P1), who also represents the estate of Father (P2), the estate of Mother (P3) and the estate of Fung (P4)
“Ho” (P5)
Defendants’ camp
“Grandmother” – Tse Hui Yuet Ying (D2), who passed away on 23 December 2014
“Wai” (D1), who represents himself and the estate of Grandmother.
7. The family had resided at Unit 506, Block 32 Wong Tai Sin Lower Estate (“Unit 506”), a public housing unit, together with Grandmother and 3rd Uncle (Father’s younger brother). In around 1978, the family successfully obtained another public unit, Unit 539, which was adjacent to Unit 506.
8. On around 5 June 1987, the Property at Flat 4 on 2/F of Block B, Kam On Court, No. 20 Hang Kam Street, Shatin, New Territories (“the Property”) was purchased in the name of Grandmother. This was a property applied for under the Green Form Home Ownership Subsidized Scheme (“HOS”). In exchange, Grandmother had to surrender Unit 539, of which she was the registered tenant, with Yiu and Wai named as occupants.
9. The purchase price was HK$335,900. A deposit of HK$16,800 (“the Deposit”) was paid to the Hong Kong Housing Authority. A mortgage dated 4 November 1987 was obtained in the name of Grandmother from HSBC for the sum of HK$319,000 (“the Mortgage”). Grandmother held an account with HSBC (“HSBC Account”), designated for repayment of the Mortgage and monthly management fee. The passbooks of the HSBC Account (“the Passbooks”), have been in Wai’s possession.
10. At the time of the purchase,
(1) Mother was a housewife.
(2) Father was a taxi driver with a gambling habit.
(3) Grandmother had income as a live-in domestic helper. She had to send her income to her husband and son(s) in Mainland China. She was not expected to bear the Mortgage.
(4) Wai had just become a police constable with a monthly income of $4,255 - $5,000.
(5) The other sons were still at school.
11. In 1988, Wai became unemployed for a few months before he started a transportation business in 1989, working with Uncle Ma (Mother’s elder brother).
12. In about 1989, Unit 506 was surrendered in exchange for Unit 1716.
13. On 29 July 1993, Father committed suicide and died intestate.
14. On 26 June 1994, Grandmother made a will (“the 1994 Will”), naming Yiu as the sole executor and devising the Property to Wai and Yiu in equal shares.
15. On 15 December 2007, Grandmother made another will (“the 2007 Will”) superseding the previous one. This time she appointed Wai as the sole executor and devised the Property to him solely.
16. The Mortgage was discharged on 14 January 2008.
17. In around 2009, Wai ceased his transportation business.
18. In about 2012, Grandmother was sent to reside in an elderly home.
19. In early 2014, Mother was diagnosed with cancer and underwent surgery on and off since then.
20. On 23 December 2014, Grandmother passed away.
21. On 12 June 2017, Mother passed away at the age of 71, intestate.
22. On 15 November 2017, HCMP 2557/2017 was issued. The District Court Action which commenced on 31 May 2018 was transferred to the High Court as HCA 2656/2018 on 13 November 2018. These actions were consolidated on 22 March 2019.
23. On 16 April 2018, grant of probate of Grandmother was issued to Wai, limited to the Property.
24. On 17 September 2018, the third son, Fung, passed away.
25. The Plaintiffs’ case on common intention constructive trust is pleaded in §1F the Re-Amended Consolidated Statement of Claim(“§1F” of “RASOC”). Allegedly, there was an oral agreement in around 1986 or an agreement otherwise inferred from the conduct among 4 persons – Grandmother, Father, Mother and Uncle Ma, and hence a common understanding among them (“Common Understanding (P)”) that:
“(1) Whilst the Property would be conveyed into Grandmother’s sole name, she was not to contribute to any purchase monies of the Property in any form at all.
(2) Father and Mother would be beneficial owners
(as joint tenants)of the Property. They would, through their own means, contribute towards the purchase price of the Property in full, and would carry out improvements to the Property once it had been purchased.(3) The Property would become the matrimonial home of the Father and the Mother.”
26. It is the Plaintiffs’ case that the initial deposit and renovation costs were paid for using a gift of money from Uncle Ma.
27. The mortgage was repaid:
(1) By the Parents, using Uncle Ma’s gifts of money to Mother from about December 1987 to December 1988;
(2) By the Parents, using their own monies from about January 1989 to July 1993; and
(3) By Mother, using gifts of money from Uncle Ma, and contributions to family expenses from Yiu, Fung and Ho.
28. The beneficial ownership of the Property rested with Mother upon the death of Father. Both Wills of Grandmother were made upon the instructions and/or approval of Mother.
29. In about 2014, Wai had proposed to Mother about sale of the Property, which was rejected. After a discussion in December 2014 among Mother, Yiu, Fung and Ho, Mother wanted to procure Grandmother to make a third will to devise the Property to all 4 sons. Unfortunately, before that could be done, Grandmother died.
30. Wai had wanted to move back to the Property but the brothers refused. Since 16 July 2019, Wai has ousted his brothers from the Property.
31. The Plaintiffs claim is for (a) a declaration that the Property is held on trust for Mother’s estate; (b) an order for sale of the Property and distribution of the sales proceeds to the 3 surviving brothers; (c) damages and/or mesne profit for the ouster.
32. The Defendants pleaded a different Common Understanding, which was among Grandmother, Father, Mother and Wai (“Common Understanding (D)”), such that:
(1) Grandmother would be the sole legal and beneficial owner of the Property;
(2) The deposit was to be shared among Grandmother, Father and Wai; and
(3) The mortgage under Grandmother’s name shall be repaid by Father and Wai.
33. Father failed to pay the deposit or to repay the mortgage as agreed, Wai was solely responsible for repayment, save for 5 instalments in 1988 that were paid by Grandmother when he became unemployed. For this purpose, Wai was entrusted with the Passbooks. Wai was also responsible for the payments of Government rents, rates and management fees.
34. Grandmother decided to make the 2007 Will as recognition that the Mortgage was almost entirely repaid by Wai.
35. The Defendants counterclaim for a declaration that Wai is the sole beneficial owner of the Property, on the bases stated above and also on the basis of resulting trust.
36. Wai also claims that he had been ousted when the brothers refused to let him move into the Property and rejected each of his proposals to house Mother and Fung.
37. I shall first examine the viability of the Plaintiffs’ pleaded case on common intention constructive trust. Then I will examine holistically all the circumstances before deciding on where version of facts to accept. I shall also consider whether resulting trust applies.
38. The parties do not challenge the testamentary capacity of Grandmother. It is just that if the Plaintiffs are successful, the act of devising the Property by will would be void because Grandmother would be disposing of an asset in which she had no interest.
39. It was agreed by both camps that, Fung having passed away without issue, on the best case of the Plaintiffs, each of Yiu, Ho and Wai would have 1/3 share in the Property; whereas on the best case of the Defendants, Wai would get 100%.
40. Each camp claims against the other for mesne profits, which shall rise and fall with each camp’s respective claim for beneficial interest in the Property.
F1. Legal principles on common intention constructive trust
41. In Tam Sui Lim William v Fung Ho[2023] HKCFI 1583, Ng J set out the principles regarding the creation of a common intention constructive trust at §§26 – 29.
“26. The starting point where there is sole legal ownership is sole beneficial ownership, and the onus is on the non-owner to show that he has any interest at all: Stack v Dowden [2007] 2 AC 432 at [56].
27. In Primecredit Ltd v Yeung Chun Pang Barry [2017] 4 HKLRD 327 at [2.3] - [2.4], Cheung JA identified two situations where a common intention constructive trust may arise.
2.3 The first situation where common intention constructive trust may arise is where at any time prior to acquisition, or exceptionally at some later date, there is an agreement, arrangement or understanding reached between the parties on how the property is to be held beneficially.
2.4 The second situation is where there is no evidence to support a finding of an agreement or arrangement on the beneficial ownership of the property and the court must rely entirely on the conduct of the parties both as the basis from which to infer a common intention on the beneficial ownership of the property and as the conduct relied on to give rise to a constructive trust. In this situation, direct contributions to the purchase price by the party who is not the legal owner, whether initially or by payment of mortgage instalments, will readily justify the inference necessary to the creation of a constructive trust. …”
28. At [1.6], Lam VP (as he then was) emphasised that the modern approach to constructive trust is to assess the common intention of the parties by a holistic approach having regard to the context. Further, as between resulting trust and constructive trust, if it is possible to resolve the matter by reference to common intention, there is no need to resort to resulting trust: per Lam VP at [1.3].
29. In Liu Wai Keung v Liu Wai Man [2015] 1 HKLRD 490 at [46]‑[50], G Lam J (as he then was) further elaborated on the elements that a party must prove in order to establish a constructive trust in his favour:
“46. The focus of the inquiry is therefore on the elements that the plaintiff has to prove in order to establish a constructive trust in his favour. In the context of this case, this means that the plaintiff must prove (i) there was a common intention between him and the defendant that the plaintiff was to be the beneficial owner of the Property despite that it was acquired in the defendant’s name; (ii) the plaintiff altered his position in detrimental reliance upon such common intention; and (iii) it is unconscionable for the defendant to assert ownership in reliance on her legal title to the Property.
47. In ascertaining whether there was a common intention, it is the objective intention of each party ‘which was reasonably understood by the other party to be manifested by that party’s words and conduct’ that one must examine: Gissing v Gissing [1971] AC 886, 906; Jones v Kernott [2012] 1 AC 776, 794 [51].
48. In the present case it is the parties’ common intention at the time of the acquisition of the Property that is relevant, there being no suggestion from anyone that the intention had changed.
49. Such intention is to be found, first and foremost, from any agreement, arrangement or understanding reached between the parties with respect to the beneficial ownership of the property concerned based on evidence of express discussions. It is only where there is no evidence to support a finding of such an agreement or arrangement that the court seeks to infer from the conduct of the parties the relevant common intention: Lloyds Bank Plc v Rosset [1991] 1 AC 107, 132‑133.
50. Even where, as in this case, reliance is placed on an express agreement, arrangement or understanding between the parties, their other conduct remains relevant as a matter by reference to which their assertions about the agreement or understanding must be gauged and tested.” (emphasis added)” [original emphasis by Ng J]
42. The above principles equally apply to properties acquired under the HOS: Cheuk Shu Yin v Yip So Wan and another (2012) 15 HKCFAR 344 at §36.
F2. Legal principles on resulting trust
43. If it is possible to resolve the matter by reference to common intention, there is no need to resort to resulting trust: Primecredit Ltd v Yeung Chun Pang Barry [2017] 4 HKLRD 327, §§1.3 and 2.4, Lam VP.
44. A resulting trust is a response to the absence of any intention on the part of the person providing the purchase price to benefit the recipient (the lack of intention analysis): Primecredit at §2.6.
45. If both parties allege that there was express discussion and actual intention as to where the beneficial interest in the property should lie, there is little scope for the operation of resulting trust: Chan Chun Ni v Chan Ngai Keung[2022] HKCFI 3031 (unreported, HCA 2206/2018, 30 September 2022) at §26 Au-Yeung J, citing Liu Wai Keung [2013] 5 HKLRD 9 at §45, G Lam J (as he then was).
46. In Tam Sui Lim William(infra), Ng J also spelled out the principles concerning the creation of a resulting trust:-
“30. A resulting trust arises under two circumstances.
31. In Westdeutsche Landesbank Girozentrale v Islington London Borough Council [1996] 2 W.L.R. 802 at 708A‑D, Lord Browne‑Wilkinson set out the law in these terms:
“Under existing law a resulting trust arises in two sets of circumstances: (A) where A makes a voluntary payment to B or pays (wholly or in part) for the purchase of property which is vested either in B alone or in the joint names of A and B, there is a presumption that A did not intend to make a gift to B: the money or property is held on trust for A (if he is the sole provider of the money) or in the case of a joint purchase by A and B in shares proportionate to their contributions. It is important to stress that this is only a presumption, which presumption is easily rebutted either by the counter‑presumption of advancement or by direct evidence of A’s intention to make an outright transfer … (B) Where A transfers property to B on express trusts, but the trusts declared do not exhaust the whole beneficial interest ... Both types of resulting trust are traditionally regarded as examples of trusts giving effect to the common intention of the parties. A resulting trust is not imposed by law against the intentions of the trustee (as is a constructive trust) but gives effect to his presumed intention.”
32. When there is sufficient evidence on actual intention at the time of the transaction, there is no room for the operation of presumption of resulting trust: Yuen Yat Shan Fiona v. Sit Hin Kai [2005] 4 HKC 170 at [20] (per Tang JA, as he then was).
33. Since the onus is on the Plaintiff to show that he has any beneficial interest in the Property at all, this court should first examine the evidence he puts forward in support of his principal case of Common Intention Constructive Trust and if necessary, his fallback position of resulting trust.”
G.ASSESSING CREDIBILITY OF WITNESSES
47. The following principles on assessing credibility of witnesses have been summarized by Deputy High Court Judge Eugene Fung SC in Hui Cheung Fai v Daiwa Development Ltd (unreported, HCA 1734/2009, 8 April 2014). In gist, contemporaneous written documents and documents which came into existence before the problems in question emerged are of the greatest importance in assessing credibility. The Court takes into account the inherent likelihood and logic of the witness’s account, the consistency of the witness’ oral and written evidence, and the consistency with undisputed or indisputable evidence. It is always best to test the veracity of witnesses by reference to the objective facts proved independently of their testimony, in particular by reference to the documents in the case, and to pay particular regard to their motives and the overall probabilities.
48. It is inherently problematic to determine what was said or agreed orally at a meeting which occurred many years before trial; not only memories fade, but even honest witnesses are prone to construct their memory of events to confirm their beliefs, prejudices, or interests: Moorthy Selvaraj v Karupayee Ammal & Ors[2024] HKCFI 403 (unreported, HCA 413/2016, 2 February 2024) at §§10-13, Harris J.
(1) Although it is open to a party to pursue a claim based on an oral agreement, understanding or a recollection of an event, for which there is little, if any, corroborating documents, the party should be informed that proving the claim may be very difficult because of the difficulties in a court choosing between alternative narratives in the absence of contemporaneous records. The court does not have to choose who to believe; if it takes the view that the evidence is unreliable, it can decide the case on the burden of proof.
(2) Before assessing the oral evidence the court should determine what facts or matters cannot be disputed or are probable. Taking a view on the veracity of the oral evidence first and then considering what can be ascertained from the objective facts runs the risk of the objective facts being given less significance than they should be.
49. In the present case, there is no documentary evidence as to how the oral agreement or each version of the Common Understanding. There are limited bank documents but, for what have been produced, they are weighty. Much turns on oral evidence and credibility is important.
50. Yiu, Ho, Uncle Ma and 3rd Uncle gave evidence on behalf of the Plaintiffs. As an overview:
(1) Uncle Ma was the only person on the Plaintiffs’ side who was said to be involved in the Common Understanding (P). His love for Mother was vivid and unreserved. Although he was a forthcoming and honest witness, his evidence actually defeated the Plaintiffs’ case on the existence of the Common Understanding (P). His other evidence on gifts of money to Mother was also unreliable.
(2) Yiu’s evidence was plainly tailored as time went by, to meet the law on common intention constructive trust. Unless otherwise specified, I do not place weight on his evidence.
(3) Ho was aged 10 at the time the Property was purchased. His evidence, though honestly given, could not bear much weight to the issues before me.
(4) 3rd Uncle has no interest in the outcome of this case. He was honest but there are aspects of his evidence that need careful consideration.
51. Wai was the only witness on the Defendants’ side. He was the only person who could give first-hand evidence surrounding the purchase. His evidence must be given great weight.
52. The Plaintiffs have referred to an act of crime when Wai was a policeman and his gambling debt. However, there was no evidence that Wai had a gambling problem at any time before the Mortgage was redeemed. His financial problems surfaced since about 2012-2013 and the loans advanced by Mother, Yiu or Ho to assist Wai were after release of the Mortgage and long after the formation of any Common Understanding. I therefore do not consider any act of crime or gambling to carry any weight on Wai’s credibility and the question of beneficial ownership.
H.PLAINTIFFS’ CASE ON COMMON INTENTION CONSTRUCTIVE TRUST
H1. The pleaded case on Common Understanding (P)
53. The pleaded case in §1F faces legal difficulties. In order to establish beneficial ownership in the Property among the 4 surviving sons, the Plaintiffs have to establish that:
(1) Beneficial ownership was created in favour of the Parents;
(2) Following Father’s death, Mother became the sole beneficial owner;
(3) Mother passed away intestate and so the beneficial owner shall be shared among the 4 brothers.
54. I agree with Mr Law that the legal basis for item (2) could only mean that there was a joint tenancy between Father and Mother as a result of the Common Understanding (P). However, the Plaintiffs have deleted the words “as joint tenants” in the RACSOC (see paragraph 25 above). Anyway, there is no presumption in law in favour of a joint tenancy. Rather, the presumption ought to be in favour of a tenancy-in-common, especially in circumstances where the purchase price was provided in unequal shares: Megarry & Wade, The Law of Real Property, 10th ed, §§12-021 to 12-022.
55. If Mother and Father were tenants-in-common, the Property would be distributed in accordance with the then section 4 of the Intestates’ Estates Ordinance, Cap 73 (1986 version), whereunder Mother would first take a sum of $200,000 from Father’s residuary plus 50% of the balance; and the sons would share the remaining 50% of the balance. Mother could not have been the sole beneficial owner of the Property who could direct Grandmother and dispose of the whole Property.
56. The poor plea of the Parents’ ownership is an example of the shaky foundation of the Plaintiffs’ case.
H2. The frail factual foundation of the Plaintiffs’ case on common intention constructive trust
57. The Plaintiffs’ case has been a changing goalpost.
58. Firstly, in a pre-action phone message on 29 July 2017 from Yiu to his siblings, including Wai, Yiu set out 21 points of “historical facts (without adding emotions)” (“the 21 Points”).
“偉，謊言多說，自[曝]其短。
有道理的，眾人就會撐你，為什麼宜家只有你一個在發顛？
你願一起找長輩表明你的清白嗎？我可代安排
Anna，我們就是要商量，但偉一出就是粗口侮辱人，要搵人度呎，我們乜都未講，佢已經唔洗同我地傾。
歷史事實，不用加感情
(1) 馬鞍山[ie the Property]：嫲、偉、耀三個戶籍去買的。
而黃大仙[ie Unit 506, then Unit 1716] 則是媽、興、豪既名擁有。
媽媽由頭到尾心意是四個兄弟，每兩個分配一間屋。
(2) 馬鞍山層樓價值約三十三萬，而舅父出左12萬(連裝修)
(3) 這二十幾、三十年來，各兄弟在不同時段都有給家用
(4) 這二十幾、三十年，舅父亦不斷每月俾錢媽媽，直到媽媽離開世界今年六月才停止。
(5) 這二十幾、三十年，偉問媽媽借了最少40萬以上，沒有還。連媽媽昏迷入院前仍問媽媽攞幾百。
(6) 偉在黃大仙住了20年，期間他取消了文豪戶籍，為了不交公屋富戶租金
(7) 文豪從此失去了綠表抽居屋機會
(8) 媽媽過身後，黃大仙現只剩下興仔的名，要轉回單人單位。
(9) 媽媽一直聲明，馬鞍山層樓不是偉的，偉去改遺囑，向媽媽說是為了方便，可一人攪手續
(10) 謝氏家族、三叔、舅父、姨都知道馬鞍山層樓是屬於媽、偉、耀的
(11) 只有偉一人自說層樓是屬於他的
…”
(間線作強調)
59. This message never mentioned Father, Grandmother or Uncle Ma as having an interest in the Property. Rather, it was Mother, Wai and Yiu who were the owners “from the beginning”. The amount that Uncle Ma was said to have contributed was different from what is now pleaded by the Plaintiff. There was no mention of any common understanding.
60. Secondly, in the pre-action letter dated 18 August 2017, CL & Co, the then solicitors for Yiu only, alleged that Yiu had funded the mortgage repayments between 1987 and 2008. Fung, Ho and Uncle Ma had also paid the deposit and/or mortgage repayments. Yiu wanted to lodge a claim to seek a declaration that he, Fung, Ho and Uncle Ma were beneficial owners of the Property.
61. As is plain for all to see, the assertions in this letter were completely different from the pleaded case. With legal advice, the case was framed on the basis of resulting trust. No oral agreement or common understanding was relied on.
62. In 2017 and 2018, twice through his solicitors, Wai had asked for the legal bases for the alleged beneficial ownership. Yiu never replied.
63. Thirdly, Uncle Ma, under cross-examination, adamantly denied that he was a party to any oral agreement or had knowledge of the Common Understanding (P). He denied having any contact with Grandmother. He did not care under whose name the Property would be registered. The pre-action letter was plainly issued without prior consultation with him. His oral evidence also showed that he did not really care how Mother would use the money that he gave her. I find that he could not have been a party to any oral agreement or the Common Understanding (P).
64. Fourthly, Ho gave no evidence as regards the Common Understanding (P) after hearing Uncle Ma give evidence. Ho was no longer sure about the existence of the Common Understanding (P).
65. Fifthly, Yiu did not claim to have taken part in the discussion that led to the Common Understanding (P); he had just finished secondary school in 1989. His evidence as regards the Common Understanding (P) was inconsistent and totally unreliable.
66. According to his witness statement, only 3 persons were involved in the Common Understanding (P) – Grandmother, Father and Mother. He confessed in the witness box that it was a “mistake” in the pleadings. His explanation that he omitted to spot the mistake was hopeless. The mistake was not clerical or trivial in nature. The Common Understanding (P) was the central part of the Plaintiffs’ case. That it involved 4 persons (whatever the combination) was stated in the pre-action letter, the Consolidated Statement of Claim and repeated in the 2 subsequent amended versions, and even in the opening submission of Mr Ng, counsel for the Plaintiffs. Yiu was a holder of an MBA degree. He did not explain the “mistake” in his witness statement and supplemental witness statement.
67. If it had been a “mistake”, why would Fung (who was alive at the commencement of the proceedings) or Ho not have spotted it?
68. Yiu also claimed in his witness statement that “no one in the family considered my Grandmother as the real owner of the Property”. There was no stated basis for this sweeping statement, especially having regard to the fact that the 3 brothers were still young and at school and did not participate in the discussion.
69. Under cross-examination, Yiu admitted that, at different stages, he would consider other people’s opinions (including Wai’s) and revise the case that he put forward.
70. That was the plainest admission of advancing a legal fiction. His evidence exhibited an attempt to piece together some incomplete information, changing his case after obtaining legal advice, and engaging in conjecture upon conjecture. Such conduct instilled no confidence in the Plaintiffs’ case.
71. On this ground of inconsistency in the Plaintiffs’ case, based on evidence from the Plaintiffs’ side, the Plaintiffs cannot even pass the first hurdle of establishing an agreement or Common Understanding of any kind. The claim must fail.
72. Even if the Plaintiffs have passed the first hurdle, there was no evidence of detrimental reliance by Father or Mother. They had lived at the Property for life. Monies for paying the deposit and renovation came from Uncle Ma. The amount or proportion of mortgage repayments contributed by Uncle Ma, Father or Mother from her own resources, respectively, was unclear. There is no submission on detrimental reliance in Mr Ng’s closing submission.
73. On unconscionability, again Mr Ng did not deal with it in his closing submission. Grandmother surrendered her rights to public housing, with knowledge of the Parents. On the Plaintiffs’ case, the Property was exclusively used by the Tse family whilst Grandmother resided out of it. Wai moved out to live at his own accommodation. The Parents lived there for life without interference until Wai proposed to sell the Property shortly before Mother died. There was nothing unconscionable for Grandmother’s estate to assert her rights as a registered owner.
74. Furthermore, as will be seen in Sections J4 and J5 below, it was Wai who contributed to the bulk of the mortgage repayments. It would not be unconscionable for him, as financial provider and beneficiary under the 2007 Will to assert his rights over the Property.
75. Accordingly, the Plaintiffs’ claim must fail for lack of proof on material elements constituting common intention constructive trust.
76. If the above matters in this Section are not sufficient to dispose of the Plaintiffs’ claim, I have gone on to consider holistically and additionally all other circumstances surrounding the purchase.
J.HOLISTIC CONSIDERATION OF THE EVIDENCE
J1. Motive for buying a property
77. In the WhatsApp voice message on 2.8.2017 at 9:21p.m., Wai stated:
“歷史事實，媽媽想當年，買2樓，並冇你所講嘅什麼心意，以佢嚟講，佢就想盡快離開黃大仙呢啲鬼地方，要公共廁所公共浴室，辛苦喇……”
78. This WhatsApp message disclosed that the concern before the purchase was to leave the appalling conditions in Wong Tai Sin Estate. I accept that to be true. I also accept that the family had wanted to expand the living area.
J2. Parties to the common understanding
79. In analyzing this issue, I place great reliance on Wai’s WhatsApp message dated 2 August 2017 (“Wai’s Message”), amidst the parties’ arguments through phone messages shortly after Mother’s death.
“好喇，到87 年，佢去，部署買呢個居屋，86 年係，誒，龍蟠苑，鑽石山，87 年尾，開始有，富安，誒，錦安，誒，咁就亦都同老豆商量過，佢都俾得起首期，跟住就去起步買啦。咁點知最終呢，首期呢，有人甩底，無俾到。跟住呢，就，去揀樓，房屋署，本來用啊嫲個名嘅，因為用咗啊嫲個名呢就，cut 左黃大仙6 樓後邊嗰間細屋，咁前面呢，就可以換間大啲嘅四人房，所以就冇用老豆個名去申請，老豆老母個名申請。咁嗰陣時大家都冇計較，最緊要有地方住，好啦，咁呢，就房屋署呢，就見到個申請人係啊嫲，當初，阿媽係想用我個名去申請嘅，點知，我爭一個月先夠21歲房屋署，reject咗我嗰份form，話我未夠21 歲，唔能夠擁有呢個買樓嘅權利。好啦，匆匆用番啊嫲個名，但係房屋署呢就話你一個人，無理由嘅，就要，其實我宜家諗番起房屋署就係搵咗我哋笨X，啊嫲係硬係要我哋嗰度抽多兩個名，上啊嫲嗰度做一個叫做家庭成員，先至俾我哋申請。其實我宜家諗番起，啊嫲買屋，啊嫲同個新抱唔啱嘅，啊嫲自己買屋咪得囉。其實我個陣時細個唔識講，宜家諗番起，一定XX房屋署，用啊嫲自己買屋，個新抱同啲仔自己住居屋，公屋唔得啊？點解要抽走個名啊。”
80. This message in rough language, sent out 30 years after the purchase of the Property, most frankly reflected the situation at the time of the purchase. No witness had refuted the contents.
81. Wai’s version of the Common Understanding (D) was that 4 persons were involved – Grandmother, Father, Mother and Wai (“the Core Members”). I find this version to be credible. Mother, being the matriach of the family, must have been a party. The other 3 were the only income-generating family members. Of course they had to be there to ensure that there was sufficient financial strength to carry out the purchase. Grandmother, in particular, would face surrender of her right to public housing. Notwithstanding she then resided at her employer’s place and, as was admitted, she was to be a nominee title holder, there would still be a need to cater for her residence when she were to retire.
82. For the reasons given in paragraph 63 above, Uncle Ma was not a party to any Common Understanding.
83. The omission of Wai’s role in the Plaintiffs’ case was deafening. This was a family which, without disrespect, had to depend on Uncle Ma for financial support. The Father was a gambler and had unstable income. It would be incredible that Mother would have recklessly committed to buying a property without ensuring that there was steady financial support. Whilst Uncle Ma was generous, it was no comparison to having a son, Wai, who had a job with stable income. All the other sons were still at school and Mother could not have expected them to contribute anything towards the purchase price in the next few years after the purchase. In fact, it is not the Plaintiffs’ case that somehow it was the intention or there had been change of intention that the other 3 sons would contribute to the purchase price.
J3. Name of property owner and beneficial ownership
84. Wai’s Message clearly explained why Grandmother’s name was used. It was important that Mother originally thought of using Wai’s name – plainly because Wai was the eldest son and the person most financially stable to have a property which he could use for the family’s residence. It turned out not to be feasible only because of Wai’s age.
85. This was never challenged by any witness. This was credible as reflecting how public housing occupants tried to maximize their benefits under the Government’s housing scheme.
86. As for beneficial ownership, I am not satisfied from the evidence that this was discussed, let alone decided on joint tenancy or tenancy-in-common.
(1) Uncle Ma just talked to Mother about the application for a housing unit. There was no discussion of ownership.
(2) 3rd Uncle claimed that it was Mother who had wanted to purchase the Property. When asked on whose behalf she wanted to purchase, he said it was to enable the family to have a residence. Again, there was no mention of ownership. It was never the Plaintiffs’ case that only Mother was to be the owner of the Property.
(3) 3rd Uncle knew that the Property did not belong to Grandmother all along. He claimed that “all along” the Property belonged to “Mother”, that was why she had a say when Grandmother was to make a will. There was no mention of the Father or other persons.
(4) Mr Ng relies on 2 sets of Wai’s answers in his closing submission:
(a) 問: 「當時買居屋之前 83-87年4月14 中間時間媽一直
提出要買居屋？」
答:「呀媽有提過」
問: 「媽媽係提出想抽居屋?」
答:「有提過，有研究過」
In my view, this only reflected Mother’s intention to acquire a property, not the intended ownership. It was never the Plaintiffs’ case that Mother was to be the sole owner.
(b) None of the extensive WhatsApp messages sent by Wai mentioned that the Property belonged to Grandmother. Indeed, Wai expressly stated that it was Mother who purchased the Property as she wanted to leave the Wong Tai Sin public housing.
In my view, this only showed why Mother wanted to purchase. Again, it was not evidence of intended ownership.
87. For a family which had used public housing for years, the drive for acquiring a property was for larger living space rather than ownership. Such was the “common understanding” that I find to exist then.
88. Wai claims that the Property was to be a gift to Grandmother, who was to be the sole beneficial owner. I can understand why he takes that view. He did not question his need to bear the mortgage repayments. When he learnt of the 1994 Will, he did not mind that Yiu would have half share of the Property upon Grandmother’s demise because Wai was not sure if he could repay the Mortgage in full then. He did not question the title of Grandmother. From his perspective, he was indeed making a gift to Grandmother who he honestly believed to be the owner. But when cross-examined on Wai’s Message, he agreed that whoever’s name was submitted to Housing Authority as owner, it was a nominee arrangement.
89. This view of Grandmother being the sole beneficial owner may not really be shared by the Core Members when one looks at matters objectively at around the time of purchase:
(1) Excluding Grandmother from ownership was unreasonable because though she was living at her employer’s residence, she would still require a residence when she retired;
(2) Excluding Father from ownership may not be reasonable because he might have been providing income, however unstable, for the family;
(3) Excluding Mother, the matriarch, from ownership would likely be objected to by Mother;
(4) Excluding Wai from ownership would be entirely unreasonable given that he was expected to bear the Mortgage.
90. Each party has given only one version of Common Understanding, which could not set well with the logic of the preceding paragraph. I am not satisifed that there had been discussion or a common understanding as to beneficial ownership.
J4. Who paid the deposit?
91. The Plaintiffs alleged that Uncle Ma gave Mother HK$40,000 as a gift. The money was deposited into Father’s account such that a cheque could be drawn therefrom. Unknown to Uncle Ma and without Mother’s consent, Father lost HK$23,200 in gambling. The remaining HK$16,800 was used to pay the deposit.
92. Wai alleged that the deposit was to be shared by Grandmother, Father and Wai. Father did not pay as promised. Mother did not contribute.
93. There is no objective evidence to support the Plaintiffs’ version. Whilst Uncle Ma might have given HK$40,000 to Mother, he could not testify as to the use of that money.
94. Further, I do not find it credible that Mother would have given the money to the Father who was known to be a gambler within the family. It seemed to be too much of a coincidence that Father happened to gamble away HK$23,200, leaving just enough to pay the deposit.
95. I also find it more probable than not that Wai’s version was correct. Grandmother, Father and Wai were the only income-generating family members at that time. It was not surprising that they shared the deposit. Wai’s Message showed Father’s breach of promise to pay the deposit.
96. I also find it probable that Mother had contributed to the deposit with the money from Uncle Ma in view of Father’s conduct.
J5. Who made the mortgage repayments?
97. Both camp’s evidence was that Grandmother would not contribute towards mortgage repayment.
98. The objective evidence was that the monthly mortgage repayments were about $2,600 to $3,200. This was borne out by records in the Passbook.
99. The Plaintiffs’ case is that repayments:
(1) from December 1987 to December 1988, were made by Mother with money from Uncle Ma;
(2) from January 1989 to July 1993, by Father and Mother with their own money; and
(3) from July 1993 onwards, by Mother only, with money from Uncle Ma and from Yiu, Fung and Ho as contributions to family expenses.
100. The Defendants’ case is that Father failed to repay the mortgage loan as agreed. Save for a period of unemployment in 1988, Wai was all along responsible for repayment of the Mortgage. For such purpose, he was entrusted with the Passbooks. He was also responsible for the payment of the government rents, rates and management fees. Wai made the payments by depositing cheques and cash into the HSBC Account.
101. As admitted by Mr Ng in §13 of his opening submission, the Plaintiffs have “not adduced direct documentary evidence to record the source of the Grandmother’s funds utilized for repaying the mortgage loan and the management fees”.
102. The Plaintiffs have never given credible evidence as to the level of income of Father at the time of the purchase of the Property. I am unable to find that the Father had actually made the mortgage repayments.
103. Mother would have to rely on Uncle Ma’s gifts of money if she ever made the mortgage repayments. However, Uncle Ma’s evidence on his payments was equivocal and not reliable. As pointed out by Mr Law, counsel for Wai, there were discrepancies in Uncle Ma’s witness statement and his oral evidence.
104. In his witness statement, Uncle Ma stated that his original intention was that he could help Mother with the mortgage repayments “should” she encounter any problem. For the first year or so, he gave $3,000 monthly to Mother for mortgage installments which stopped at about the end of 1988, as Mother said to him that she and Father could afford the mortgage repayments themselves.
105. He refuted this version in his oral evidence. He said that:
(1) Prior to the purchase of the Property, he gave $3,000 monthly to Mother.
(2) After renovation but before Father’s suicide, the amount was increased to $6,000 monthly, because of the extra burden of mortgage installments.
(3) Subsequently, the amount was increased to $10,000.
106. There was no explanation for such glaring discrepancies between 2 versions. These discrepancies should also be considered in light of (i) the fact that he only had records of his financial assistance to Mother since about 1999 and (ii) the Plaintiffs’ pleaded reply that Uncle Ma only “occasionally gave [Mother] some money for daily use”.
107. Although I find Uncle Ma to be an honest person, I do not find his evidence to be reliable when it comes to the amount of his financial assistance to Mother prior to 1999. Moreover, he did not care how she would use it. I am not satisfied that he had given her money specifically for mortgage repayment.
108. I do not accept that the other brothers’ payments to Mother could be regarded as contributions to the mortgage repayments. They were still at school whereas Wai had already been working since about 1984. There was no evidence that the Core Members took into account future contributions from the other brothers. The brothers’ payments to Mother, if at all, came only years after the purchase and could not have implications on beneficial ownership of the Property.
109. The Plaintiffs have produced a vast volume of Mother’s passbooks, but the withdrawals therefrom did not match, no matter in terms of time or amount, with the deposits recorded in the HSBC Account.
(1) For the purpose of illustration, a summary of all withdrawals exceeding the sum of $1,000 recorded in the passbooks of the relevant accounts in Mother’s name has been prepared in a table marked D MFI-2.[1]
(2) D MFI-1 (deposits into the HSBC Account) and D MFI-2 were shown to YIU, who accepted without hesitation that those withdrawals did not match the deposits in the HSBC Account.
110. Yiu insisted that Mother may have other accounts including a current account. However, the Plaintiffs had neither sought specific discovery from the Defendants nor had they made enquiries with the banks.
111. On the other hand, the Defendants’ case was more solid.
112. Firstly, Wai mentioned that he signed a guarantee for the Mortgage. Although there was no documentary evidence, I find this to be credible. Given her age and income, I do not believe Grandmother was able to obtain a mortgage. It must have been Wai who acted as guarantor due to his stable income. That was consistent with Mother’s original intention to buy the Property in his name.
113. Secondly, even Yiu acknowledged in a WhatsApp message dated 27 July 2017 (“Yiu’s Message”) that Wai had made the mortgage repayments:
“偉，其實點解所有兄弟、媽媽、親戚都在不值你私吞了馬鞍山。難道你認識的每一個人腦子都有問題，唯獨你是手握真理嗎？
你必定會為以上的說話懊悔的，你的家人亦不會以你這樣的態度說話為榮，你知嗎？
你由細到大，舅父對你供書教學、給你生意，阿嫲問三叔攞錢俾你買第一部車，而那時仍在讀中學的我則每月問教會借 2000 蚊維持住個家，你享受黃大仙低成本住屋20年而只要拿3200蚊來供樓，媽媽沒有跟你計較每月一萬一萬咁借俾你、打本俾你做其他生意、俾錢俾你買股票而一去無回，你知唔知你供樓的每一毫都是來自媽媽的，之後你不經我同意篡改遺囑，稱阿嫲離開後一個人搞手續會方便 D，後來就想欺騙全天下，間樓是你的，我都唔出聲，因為你那時是一個正常的阿哥，我有東西都可以送給你。…” (間線作強調)
The amount of $3,200 in fact matched the entries in the HSBC Account.
114. Thirdly, Wai was in possession of the Passbooks which covered the period from 31 July 1997 to 17 May 2008 (ie till after release of the Mortgage). The monthly withdrawals were in the range of $2,000 to 4,000 marked “LOAN REPAY” and “MGT FEE”.
115. Counsel have helpfully agreed on tables of transactions in the HSBC Account. It can be seen that there were deposits into the HSBC Account from time to time. 60 out of the 93 deposits were cheque deposits. See D MFI-1.[2]
Mode of deposit Amount Percentge Total by ATM $19,900 4.80% Total by Cash $21,000 5.07% Total by Cheque $363,440 + $10,000[3] = $373,440 90.10% Total Amount Deposited $414,340 100%
116. Despite the limited period covered by the Passbooks, it was the only contemporaneous record of repayments[4]. Wai said that most of the deposits he made to the Mortgage Account were by way of cheques drawn from his business account. Being a business owner, it was natural for him to have a current account under his control. I accept Wai’s evidence that the cheques had come from him.
117. He was also responsible for payment of management fees as could be seen from the Passbooks. Wai also contributed to the government rents and rates, as could be seen from a phone message.
118. Wai did not shy away from the fact that he could not repay for 5 months. He first said it was Grandmother who paid but his oral evidence also stated that it could be Mother. There could also be other occasions when Mother paid. Despite these, it did not undermine the objective picture disclosed in the Passbooks that it was Wai who bore the bulk of the mortgage repayments.
119. Fourthly, it was plain from the Passbooks that this was not a case where Mother pooled together housekeeping money from all her sons in order to repay the Mortgage. The cheques went directly from Wai to HSBC.
120. Yiu tried to refute Wai’s evidence by suggesting that it was Mother who issued cheques to repay the Mortgage. This was a hollow suggestion. Mother plainly did not have a current account because, if she had:
(1) She would not need to give the money for the deposit (on Plaintiffs’ case) to Father to issue a cheque/cashier order;
(2) The cheque books or evidence of her having a current account would have been located among all her passbooks of other bank accounts that Yiu had produced. Yiu hinted that Wai might have “stolen” the documents relating to Mother’s current account but this was pure speculation.
(3) The Passbooks would have been in her possession if she had been the true owner or in charge of the mortgage repayments.
121. None of the Plaintiffs’ witnesses could tell how Mother made payments into the HSBC Account how much.
122. Fourthly, Wai did have means to repay the Mortgage. On Uncle Ma’s evidence, Wai went from 1 vehicle in his transportation business to several. Between 2004 and 2015, he even owned a property at Kam Fung Court. Accordingly, it was wrong for Yiu’s Message to say that “every penny of the mortgage repayments had come from Mother”. Even if Mother had lent money to Wai, that did not mean that Mother herself bore the mortgage repayments. Further, Yiu admitted that there were records showing that Wai had at least repaid some of the loans.
123. The evidence was overwhelming in showing that it was Wai who had paid the mortgage repayments, management fees, rates and government rents. He honoured the common understanding to repay the Mortgage. His contribution to the deposit and the mortgage repayments were completely consistent with the original intention of Mother to use Wai’s name and then Grandmother’s name. These are also the reasons why I stated that the exclusion of Wai from the Common Understanding (P) was deafening and wholly unreasonable. (§§83 and 89(4) above)
J6. Who contributed to the renovation costs?
124. There is no dispute that the source of money for renovation was Uncle Ma, be it a gift (on Plaintiffs’ version) or a loan (on Defendants’ version, and the loan was waived by Uncle Ma after partial repayment).
125. Anyhow, who contributed to the renovation costs was not, rightly, relied on by any party as an indicator of beneficial ownership.
J7. Who resided at the Property?
126. There is not much dispute. Father and Mother, Yiu, Fung and Ho resided there. The 3 brothers would have more direct knowledge of Grandmother’s living arrangements. I accept their evidence that she worked as a domestic helper and lived at her employer’s home during weekdays. She might have resided at the Property to help take care of the 3 brothers, as alleged by Wai. In around February 1988, Grandmother moved to Sui Wo Court to live with 3rd Uncle.
127. The intention of expanding the living space and improving the quality of the living environment was met.
128. Wai had barely lived at the Property. I do not find this to be relevant to the issue of beneficial owner. He has given a good explanation. – that it was more convenient for him to reside at Flat 18, 29/F, Block H, Kam Fung Court, 638 Sai Sha Road, Shatin (“MOS Property”) in order to go to work. In fact, this only showed his generosity in financing the purchase of the Property.
J8. Contributions to the household
129. Yiu has confirmed to the Court under cross-examination that it was not the Plaintiffs’ case that the Common Understanding (P) was that the beneficial interest in the Property should depend on or be apportioned according to the brothers’ respective financial contributions to Mother. I therefore disregard all payments of the brothers to Mother.
J9. Wai’s borrowings from Mother
130. It would be fair to say that Mother had given monies to Wai. The RACSOC pleaded that throughout the years and in particular between June to August 2016, Wai had made repeated requests to Mother for money, notwithstanding the fact that Mother was receiving cancer treatment. The Plaintiffs suggested that Wai had taken more from Mother than he paid for the Mortgage.
131. Yiu also stated that Wai had incurred huge debts upon failure of business. There were times when Yiu had to help Wai repay Wai’s mortgage over the MOS Property.
132. However, these were things happening well after the purchase and were pleaded under the title of “1994: Conduct of the Relevant Parties”. Wai’s financial difficulties only started to appear in 2012 and 2013, well after release of the Mortgage. The borrowings could have no impact on anyone’s share of beneficial ownership already accrued. I thus disregard the evidence under Section J7.
K.OTHER INDICIA OF BENEFICIAL OWNERSHIP
K1. Possession of the title deeds
133. The 2007 Will was made by Grandmother around the time of redemption of the Mortgage. Upon redemption, the title deeds to the Property were placed in the possession of Wai till now. There was no evidence that Mother had demanded for those title deeds though she was then (on the Plaintiffs’ case) the sole surviving beneficial owner. This was weighty evidence to show:
(1) Grandmother and Mother’s recognition that Wai was the person who was expected to repay and did repay the Mortgage;
(2) Whether Grandmother or Mother had say over disposition of the Property/title deeds, the other had no objection to this.
K2. Grandmother’s Wills
134. The Plaintiffs’ core contention is that both Wills were made on the instructions or with the approval of Mother who was the beneficial owner and Grandmother had complied with Mother’s “instructions”.
135. With regard to the 1994 Will, according to Yiu, despite what was stated therein, Yiu claimed that it was intended and understood between Grandmother, Mother, Wai and Yiu that, in the event of Grandmother’s passing, Wai and Yiu would hold the Property under the 1994 Will for the benefit of the Mother, in furtherance of the Common Understanding (P).
136. One wondered how the alleged understanding could have arisen when Wai was not even informed before the 1994 Will was made.
137. Yiu claimed that he had told the solicitor’s staff that Mother (but not Grandmother) was the beneficial owner of the Property. YIU even stressed that this kind of nominee arrangement was commonly known at the time, and there was no secret about it (“唔係好神秘”). I find it surprising that the solicitor had nonetheless prepared the 1994 Will in view of Yiu’s remarks.
138. Anyway, there was no objective evidence that Mother wanted there to be a trust in her sole favour. It was more consistent with what Yiu’s Message stated to be Mother’s intention “all along” that each of 2 sons shall have a property. If so, the 1994 Will reflected Mother’s view on beneficial ownership.
139. Even accepting that it was Mother who gave the instructions or approval to make the Wills, it could of course mean that she had full beneficial ownership. It could equally mean that Grandmother, as owner, was persuaded by Mother to do as Mother wished. The Plaintiffs have failed to prove on balance which was the more probable inference.
140. Wai said that he did not raise objection to the 1994 Will because at that time he was not certain is he would be able to repay the Mortgage in full on his own and he thought that Yiu might be required to shoulder some responsibility in repayment. I find that this reflected his truthful thinking after having lost 5 months’ employment in the past and that the Property was to be a gift to Grandmother.
141. With regard to the 2007 Will, it was made 13 years after the 1994 Will. The 3 brothers did not know about it until 2010. Wai sought Mother’s permission to arrange for Grandmother to make the 2007 Will, devising the Property to Wai only, citing the reasons that it would be more convenient for one person (Wai himself) to deal with relevant matters in the event of Grandmother’s passing (which I take to mean probate procedure). This is supported by Wai’s message to Yiu dated 4 August 2017, “層樓係我梗係一人搞手續啦，一隊足球隊去搞手續呀？” As pleaded, it was intended and understood between Grandmother, Mother and Wai that, in the event of Grandmother’s passing, Wai would hold the Property under the 2007 Will for the benefit of Mother.
142. However, I agree with the analyses of Mr Law:
(1) Just to tell Mother that it would be more convenient to have one person to deal with the relevant matters under the 2007 Will would, as a matter of logic, hardly persuade Mother because under the 1994 Will, there was also only one executor (Yiu).
(2) Yiu spent 6 elaborate paragraphs (§§68-73) in his witness statement to describe the growing tension between Mother and Wai. Wai was said to have visited Mother less frequently and Mother criticized Wai for failing to contact her. Wai was described as having “little responsibility to the matters in relation to the family and the Property”. The tension so grew that Mother would “grumble about lending money to [Wai] from time to time”. Wai was also increasingly aggressive towards Mother. On the other hand, Yiu described himself as having a very close relationship with Mother.
(3) Against such background, and since the 1994 Will had already retained her beneficial ownership in the Property through 2 sons, Mother would have trusted Yiu more as an executor, instead of Wai who had “little responsibility to the matters in relation to the family and the Property”?
(4) If Mother had told the sons about the 1994 Will and it was her idea to do the 2007 Will, why had she kept the other sons in the dark about the latter? Wai never asked Mother not to tell others about the 2007 Will and yet the other sons only found out about the 2007 Will about 3 years later. It appeared that she did not even tell Yiu that he was no longer needed as an executor.
(5) Yiu’s Message showed that Yiu knew about the 2007 Will but took no action. He still regarded Wai as a “normal brother”, which was inconsistent with sub-paragraph (2) and Mother’s intention to give one property to each of 2 sons. The inferences I draw are that Wai was not as bad as Yiu has tried to portray and that the brothers then accepted that Wai was the person who paid the Mortgage and hence entitled to the Property.
143. Further, Yiu claimed (corroborated by Ho) that in about May 2010, Wai promised that if the Property was to be passed to him under the 2007 Will, he would hold the Property for Mother’s benefit and, after Mother’s passing, for Mother’s estate to be vested in equal shares for the benefit of each of the 4 brothers. Wai denied this.
144. I do not accept that Wai had made the alleged promise. Why would he agree to take up a more onerous role as a sole executor but on terms less advantageous to him than under the 1994 Will?
145. I do not accept the Plaintiffs’ evidence about what led to the making of the 2007 Will.
146. On the other hand, this Will and the Release of the Mortgage were one month apart. Both documents were prepared by the same firm of solicitors. In my view, the overwhelming inference is that the 2007 Will was Grandmother’s recognition of Wai’s mortgage repayments and hence the beneficial ownership was devised to him. Mother agreed with Grandmother and hence it was not necessary for her to inform the other brothers.
147. There was a 3rd will which Mother had wanted Grandmother to make. That was prompted by Wai’s insistence, in around early 2014, on selling the Property in order to repay his debts. His proposal was rejected by Mother and the brothers, who offered to lend him and actually lent him money. Wai’s proposal to provide alternative accommodation to Mother was also rejected. Allegedly, in a family meeting in about May 2014, Mother told Wai that the Property did not belong to him alone and that the other brothers were also to have a share in it. Wai ended the argument by accepting the fact that his brothers were to have a share in the Property. Eventually he sold his MOS Property to repay his debt.
148. I am unable to accept, once again, that Wai had accepted that his brothers had a share in the Property, with the 2007 Will in his hand. His asking Mother for approval for the sale was out of respect to her as mother and occupier, so that her moving out could be non-acrimonious.
149. Anyway, it appeared that Mother was so concerned about Wai’s proposals that, in December 2014, Mother instructed, in the presence of the 3 brothers, that the third will of Grandmother should be prepared so as to devise the Property to the 4 brothers, with Yiu as executor. 3rd Uncle’s evidence corroborated the existence of Mother’s instructions. However, before that will could be made, Grandmother passed away.
150. I can understand why it took a few months in 2014 before Mother (herself ill) decided to have the third will prepared. Grandmother had lost her ability to speak and eat and asking her to execute a will would not be an easy task.
151. This course of events was of course a piece of evidence to show that Mother had say over disposal of the Property. However, as I have held, there was no prior discussion over beneficial ownership. The fact that Mother thought that she had full beneficial ownership was irrelevant.
152. There was some evidence that Mother was concerned about the proceeds of sale of the Property. In his WhatsApp message dated 27 July 2017, Wai acknowledged that Mother made some demands over the distribution of proceeds of sale of the Property: “阿媽亦都不斷打電話嚟，誒，賣樓要分啲錢俾你哋”).
153. However, I consider that it was Mother’s wish over distribution of the proceeds (分的錢) without indication of property ownership. She did not ask Wai to return the money to the brothers (分返的錢) as if they were originally entitled to the same. The same Whatsapp message also recorded that sometimes Mother told Wai that the Property would be his.
K3. Grandmother’s statement to the Housing Authority
154. As late as December 2010, Grandmother was still claiming to outsiders to be “owner” of the Property. She had signed by affixing a chop and marking a cross on the Income & Assets Declaration Form for the Building Maintenance Grant Scheme for Elderly Owners of Hong Kong Housing Authority, describing herself as “owner” of the Property. There is no suggestion that she did not have the mental capacity to do so or that she did not understand her own claim.
K4. 3rd Uncle’s statement to the Housing Authority
155. In around the end of 2012, Grandmother had a stroke, became incapacitated, unable to speak or eat. 3rd Uncle applied for her to live in a government-funded elderly home. He signed a statement declaring on behalf of Grandmother that she did not own any property, including the Property.
156. According to Wai, he produced his cheque records of the mortgage repayments to the Social Welfare Department to prove that the funds for purchasing the Property did not come from Grandmother.
157. I place no weight on such evidence, as there was no suggestion that Grandmother herself authorized the giving of the declaration.
L1. Common intention constructive trust
158. The Plaintiffs’ camp and the Defendants’ camp has each put forth one version of common understanding, with no alternative case. Having regard to the above analyses,
(1) I reject the Common Understanding (P) for defective plea, frail factual foundation, lack of detrimental reliance by the Parents and that it was not conscionable for Grandmother’s estate or Wai to assert the legal title.
(2) I also reject the Common Understanding (D) to the extent that the intention of the Core Members was to make a gift of the Property to Grandmother alone.
159. I find that it was more likely than not that the Core Members were the ones involved in discussing how to go about buying the Property. Initially it was intended that Wai should be the registered owner but he was yet to become 21. So Grandmother’s name was used instead as a nominee.
160. The deposit was paid by Grandmother, Wai and probably money from Uncle Ma. Father had failed to contribute as agreed.
161. Wai had honoured the common understanding of the Core Members that he should bear the Mortgage by being a guarantor and making the mortgage repayments almost in full, with 5 instalments borne by Grandmother and/or Mother when he was unemployed.
162. Mother was not expected to contribute as she was a housewife. The other 3 sons were still at school and they were not expected to contribute to the mortgage repayments.
163. I am not satisfied that the Core Members have discussed about or thought about the beneficial ownership. Nor can I infer an “agreement” or “understanding of some kind over beneficial ownership even having made a holistic consideration of the circumstances.
164. I have stated that, objectively, it would have been unreasonable to exclude any of the 4 Core Members from ownership in paragraph 89 above. I hasten to add that this was not the pleaded case of any party and it has not been put to Wai or Yiu during cross-examination. It could have affected the proportion of Mother’s share in the Property. I cannot rely on this departure from the pleaded versions to determine the case. See Poon Hau Kei v Hsing Chong Construction Co Ltd Taylor Woodrow International Ltd Joint Venture [2004] 2 HKLRD 442, §12 (CFA), citing the ruling of Ma JA (as he then was) [2003] 2 HKLRD 56, §§41 and 42 (CA).
165. The Plaintiffs fail to discharge their burden of proving a common intention constructive trust or Mother’s share in the Property. In any case, if the case on “joint tenancy” is valid, Wai, being the sole survivor would be the ultimate owner. The Defendants fail to show the share of the nominee Grandmother. It is not clear if Grandmother can dispose of the whole Property.
L2. Resulting trust
166. In the light of such findings, I can only resort to resulting trust. This must operate in favour of Wai and not his Parents, having regard to his financial contribution towards the purchase and the acknowledgement of Grandmother and Mother through the 2007 Will. Grandmother’s Estate did not claim interest based on the contribution to the deposit and 5 mortgage installments. Wai should take the full Property.
L3. Conclusion on beneficial ownership
167. On any of the following bases, I find Wai to be the beneficial owner of the Property:
(1) Failure of the Plaintiffs to prove their case on balance of probabilities;
(2) On resulting trust as being the major contributor to the purchase price.
168. There is no dispute as to the fact of ouster having happened on either camp’s case. Quantum on mesne profits has been agreed:
(1) On the Plaintiffs’ case, it should count from 16 July 2019 to 17 April 2025, ie $15,000 per month x 2,103 days ÷ 30 = $1,051,500
(2) On the Defendants’ case, it should count from 1 January 2018 to 11 July 2019, ie $15,000 per month x 557 days ÷ 30 =$278,500
169. As I have ruled on beneficial ownership in favour of Wai, it is he who would get mesne profits for ouster in the sum of $278,500.
170. I order as follows:
(1) The Plaintiffs’ claim is dismissed;
(2) There be a declaration that the 1st Defendant (Wai) is the sole beneficial owner of the Property.
(3) There be payment of mesne profits by the Plaintiffs to the 1st Defendant in the sum of $278,500, with interest (on a nisi basis) at judgment rate from the date of judgment until payment.
171. Costs should follow the event and, on a nisi basis, be to the 1st Defendant.
172. I thank counsel for their assistance. The fair summary of facts and detailed analyses of Mr Law are particularly appreciated.
| (Queeny Au-Yeung) Judge of the Court of First Instance High Court |
Mr Felix Ng and Ms Polly Li, instructed by CL & Co. Solicitors, for the 1st to 5th Plaintiffs
Mr Law Ka Sing, instructed by instructed by Kwok Hei Law Office, assigned by Director of Legal Aid, for the 1st to 2nd Defendants
[1] This is not to be confused with Schedule 2 to Wai’s Supplemental Witness Statement, which contains the sums identified by him as the financial support he made to Mother by cheques.
[2] D MFI-1 is not Schedule 1 to WAI’s Supplemental Witness Statement because it merely summarises in a neutral way all the deposits recorded in the passbooks of the Mortgage Account.
[3] According to P MFI-5, D MFI-1 misses one deposit by cheque in the amount of $10,000 dated 5 June 2003.
[4] Wai accepts that the schedule attached to his witness statement listing out the deposits he made over the years to the HSBC Account and the withdrawals therefrom was not a contemporaneous record of his deposits and mortgage repayments.