LO WO AND OTHERS v. CHEUNG CHAN KA, JOSEPH AND ANOTHER

LO WO AND OTHERS v. CHEUNG CHAN KA, JOSEPH AND ANOTHER

The court found on the facts that the plaintiffs were under serious disadvantage (age, illiteracy, poverty, lack of independent advice), the terms of the August 1993 agreement were oppressive (price and deposit grossly undervalue relative to contemporaneous purchases) and defendants and their agents acted with moral culpability and overreaching; accordingly the agreements and assignment constituted an unconscionable bargain to be set aside and were rescinded on conditions including repayment of sums received with interest; also the administrator was to be removed and title procedures ordered.

Citation
LO WO AND OTHERS v. CHEUNG CHAN KA, JOSEPH AND ANOTHER
Parties
1st Plaintiff: Lo Wo; 2nd Plaintiff: Lo Tai; 3rd Plaintiff: Lo Lan; 1st Defendant: Cheung Chan Ka, Joseph; 2nd Defendant: Bond Star Development Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
9 June 2000
Case Number
HCA618/1997
Procedural Posture
Civil (property/conveyancing) Unconscionable Bargain / Rescission / Judgment After Trial
Outcome
Judgment for Plaintiffs. August 1993 Provisional Agreement, Formal 1995 Agreement and Assignment set aside as unconscionable; declarations and consequential orders granted, administrator removed and replacement appointment directed, conditional rescission ordered.
Legal Topics
Unconscionable Bargain, Rescission, Undervalue, Letters of Administration, Undue Influence, Fraud
Source Language
EN
Equity Contract Property Conveyancing Succession Unconscionable Bargain Rescission Undervalue +3 more

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Parties

Lo Wo

1st Plaintiff

Lo Tai

2nd Plaintiff

Lo Lan

3rd Plaintiff

Cheung Chan Ka, Joseph

1st Defendant

Bond Star Development Limited

2nd Defendant

Procedural Posture

Civil (property/conveyancing) Unconscionable Bargain / Rescission / Judgment After Trial

Legal Issues

  1. 1 Whether the sale agreements constituted an unconscionable bargain and should be set aside
  2. 2 Whether plaintiffs were under serious disadvantage (age, illiteracy, poverty, lack of independent advice)
  3. 3 Whether defendants acted with moral culpability/fraud or overreaching

Ratio Decidendi

The court found on the facts that the plaintiffs were under serious disadvantage (age, illiteracy, poverty, lack of independent advice), the terms of the August 1993 agreement were oppressive (price and deposit grossly undervalue relative to contemporaneous purchases) and defendants and their agents acted with moral culpability and overreaching; accordingly the agreements and assignment constituted an unconscionable bargain to be set aside and were rescinded on conditions including repayment of sums received with interest; also the administrator was to be removed and title procedures ordered.

Court Disposition

Judgment for Plaintiffs. August 1993 Provisional Agreement, Formal 1995 Agreement and Assignment set aside as unconscionable; declarations and consequential orders granted, administrator removed and replacement appointment directed, conditional rescission ordered.

Orders

  • Rescission of the August 1993 Provisional Purchase Agreement on condition that plaintiffs repay $50,000 with interest at 2% above prime from 24 August 1993 and $100,000 with interest at 2% above prime from 6 January 1994
  • Declaration that the August 1993 Agreement ought to be set aside