FANG MENG SUNG, JOHN v. CHAN YING KAI AND ANOTHER

FANG MENG SUNG, JOHN v. CHAN YING KAI AND ANOTHER

On the evidence the court found Fang's account and contemporaneous documents credible and rejected the defendants' accounts; the loans were advanced to Chan and Hung and $3,480,000 remains payable; the sale to Well Prestige was a sham with knowledge of the equitable mortgage and therefore the sale is subject to Fang's equitable mortgage; Fang is entitled to judgment for the principal and interest at judgment rate from the date of default; registration of the equitable mortgage and statutory declaration should not be vacated.

Citation
FANG MENG SUNG, JOHN v. CHAN YING KAI AND ANOTHER
Parties
Plaintiff (hcmp No.1246/2007); 1st Defendant in Counterclaim: Well Prestige Investment Limited; Plaintiff (hca No.2021/2006); Defendant and Plaintiff in Counterclaim (hcmp No.1246/2007): Fang Meng Sung, John; Defendant (hca No.2021/2006); 2nd Defendant in Counterclaim (hcmp No.1246/2007): Chan Ying Kai; Defendant (hca No.2021/2006); 3rd Defendant in Counterclaim (hcmp No.1246/2007): Hung Sin Yee Josephine
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
30 May 2012
Case Number
HCA2021/2006
Procedural Posture
Civil Consolidated Loan Recovery and Land Registration Actions / Judgment (trial Concluded)
Outcome
Judgment for Fang Meng Sung, John for outstanding loan of $3,480,000; Well Prestige's claim to vacate registration dismissed; declaration that the sale to Well Prestige is subject to Fang's equitable mortgage; costs to Fang (order nisi).
Legal Topics
Equitable Mortgage, Vacation of Registration, Priority of Registration, Sham Transaction, Loan Repayment, Interest on Judgment
Source Language
EN
Contract Equity Property Law Land Registration Conveyancing Equitable Mortgage Vacation of Registration Priority of Registration +3 more

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Parties

Well Prestige Investment Limited

Plaintiff (hcmp No.1246/2007); 1st Defendant in Counterclaim

Fang Meng Sung, John

Plaintiff (hca No.2021/2006); Defendant and Plaintiff in Counterclaim (hcmp No.1246/2007)

Chan Ying Kai

Defendant (hca No.2021/2006); 2nd Defendant in Counterclaim (hcmp No.1246/2007)

Hung Sin Yee Josephine

Defendant (hca No.2021/2006); 3rd Defendant in Counterclaim (hcmp No.1246/2007)

Procedural Posture

Civil Consolidated Loan Recovery and Land Registration Actions / Judgment (trial Concluded)

Legal Issues

  1. 1 Whether the loans were advanced to Chan and Hung and remain unpaid
  2. 2 Whether the equitable mortgage registered by Fang is effective and enforceable against subsequent purchaser
  3. 3 Whether the sale of the Property to Well Prestige was a sham intended to defeat the equitable mortgage

Ratio Decidendi

On the evidence the court found Fang's account and contemporaneous documents credible and rejected the defendants' accounts; the loans were advanced to Chan and Hung and $3,480,000 remains payable; the sale to Well Prestige was a sham with knowledge of the equitable mortgage and therefore the sale is subject to Fang's equitable mortgage; Fang is entitled to judgment for the principal and interest at judgment rate from the date of default; registration of the equitable mortgage and statutory declaration should not be vacated.

Court Disposition

Judgment for Fang Meng Sung, John for outstanding loan of $3,480,000; Well Prestige's claim to vacate registration dismissed; declaration that the sale to Well Prestige is subject to Fang's equitable mortgage; costs to Fang (order nisi).

Orders

  • Judgment for plaintiff Fang Meng Sung, John in HCA No.2021 of 2006 for $3,480,000
  • Interest on the judgment sum at judgment rates from 16 September 2000 to date and thereafter at judgment rate