IN THE SUPREME COURT OF TONGA
CIVIL JURISDICTION
NUKU'ALOFA REGISTRY

CV 213 OF 2010

BETWEEN:

1. YANG HUNG HUI
2. LI YOU NUI
PLAINTIFFS

AND:

MO DENG FANG
defendant

Before The Hon. JUSTICE CATO

JUDGMENT

[1]	The plaintiff and his wife claimed judgment against the defendant for $44,000 Tongan for the non-payment of a loan. According to the plaintiff the money had been lent to the defendant who at that time was his son-in-law. The defendant in his evidence claimed that this was for use in the course of a business he had that was associated with dealing in sandlewood. Whatever was the purpose of the loan it is clear from the statement of defence and his evidence that the defendant admitted that he had borrowed this money from the plaintiffs but denied the loan was outstanding. He contended that he had repaid the loan shortly after incurring it, and that he had discharged the debt.

[2]	I heard the plaintiff Yang Hung Hui give evidence for about a day. He tended to become excited if not passionate about his claim and at times even through an interpreter his evidence was at times difficult to understand. However, essentially, he clearly denied that the loan had ever been repaid despite several demands for payment. The only issue in the case is whether I am satisfied that payment was made and the debt discharged. 

[3]	At the conclusion of the plaintiff's evidence, the defendant's counsel Ms Tonga applied for an adjournment on the basis that her client had failed to meet a connecting flight from Fiji. He had been in Fiji to effect business on the opening morning of the trial and had been expected in Tonga later to give evidence on the second day. Initially, I was reluctant to give an adjournment since the matter had been set down for some time. I initially adjourned the second day set down for trial to a third day when it was reported again that the defendant had failed to be able to arrange a flight to arrive in Tonga for the hearing on the third day. Ms Tonga renewed her application and with some reluctance I adjourned the proceedings to allow her to make a formal application with an affidavit in support from her client. Having received those documents, I was satisfied the application was bona fide so I allowed the application and the hearing resumed on the 20th December, 2012 when the defendant gave evidence. I awarded the plaintiffs costs of appearance on the second and third days to be fixed by the Registrar, if the parties could not agree.

[4]	The defendant admitted borrowing the money in April 2007. He said it was to be used in connection with a business he had involving Sandlewood. He said, however, that with the knowledge of the plaintiffs, he repaid the loan shortly after by a payment direct to his wife, the plaintiff's daughter who was residing in China. He had done this by way of a debit from his company business account of $50,024.62 (Tongan) which not only satisfied the loan but also included an amount for his wife for her purposes. The plaintiff denied this. The bank document recording the payment or transfer was produced in evidence but it did not include any notation as to what the payment was for. Nor did the defendant produce any written authority from the plaintiffs authorizing the discharge of the loan by payment to the wife. Nor was there any document signed by them purporting to subsequently approbate or ratify the discharge of the loan, by a payment to the wife. 

[5]	In order to discharge a debt by payment to a third party, the debtor has to establish either that the payment was made to the third party at the request of the creditor and or was later ratified. Goff and Jones, The law of Restitution, 4thed 1993, Sweet and Maxwell pp 597-8 Further, it is clear that the onus of proving on balance of probability that a debt has been discharged is on the defendant. Young v Queensland Trustees (1956) 99 CLR 560.

[6]	The defendant explained that he had borrowed the money to advance his sandlewood interests, and that after payment had been made for a consignment, at the request of his father-in-law, he had sent the money to his daughter so that she could repay money to those in China who had advanced the money to the plaintiffs. There was evidence that the plaintiffs had in fact borrowed the money from Chinese sources. The defendant said he had shown or given a copy of the bank transfer to the plaintiff. This was also denied. He said he had not bothered to get written instructions because they were family. 

[7]	During the course of interlocutory proceedings, the plaintiff had adduced an affidavit from his daughter in China the admission of which was opposed as hearsay evidence at this trial because the daughter was not present to give evidence. I have dismissed the contents of that affidavit from my mind. The effect, however, is that there is no evidence aside from that of the defendant as to the reason why the payment was made to the wife. 

[8]	During the course of the evidence, documents were produced by the plaintiff purporting to record the defendant's acknowledgment of the debt in September 2009. The defendant denied that his signature was on these documents and in effect said they were forgeries. Without the assistance of an expert witness in handwriting, however, I am unable to say whether this was so. The defendant contended that because documents were forgeries, this undermined the credibility of Yang Hung Hui so that I should not accept his evidence that he did not in fact authorize the payment to the wife in discharge of he and his wife's debt. The defendant also said he had had little to do with the plaintiffs in more recent years, and indeed was elsewhere when the documents were signed in September 2009. As I have said, however, I am unable to conclude on the evidence before me that the documents were forgeries which is a serious allegation to make, and one of which requires substantial proof. The documents are consistent with the plaintiff's continuing to press for payment and I cannot find in them any more than this.

[9]	The defendant also contended that Yang Hang Hui was a serious gambler and he was pressing for payment wrongfully to secure funds to discharge his gambling debts. This was denied and I do not consider that this allegation is substantiated either. The defendant did not call any further evidence to substantiate any other aspect of his evidence. 

[10]	I concluded after hearing the plaintiff that he was a simple watch repairer and that his denial of giving instruction to the defendant to repay the debt to his daughter coupled with his determined efforts to secure repayment over quite a long period of time meant that it was unlikely he was lying about the issue of discharge. 

[11]	The defendant, however, who had soon after payment to the wife separated from her, I considered a person with considerably more business and worldly acumen and experience. As such I found it surprising, notwithstanding that at the time the plaintiffs were his in-laws that he would not have secured some written acknowledgment or instruction from them that the debt was quite substantial was to be discharged by a direct payment to the wife. In the absence of some written proof of this or ratification, I decline to find that the defendant has discharged the burden of establishing that the debt has been repaid and discharged. 

[12]	Accordingly, I give judgment for the sum claimed namely $44,000 Tongan to the plaintiffs. 

[13]	I award interest at the rate claimed of 10% from the date on which the claim was filed in this Court to the date of judgment. 

[14]	I award costs to the plaintiffs of these proceedings and in the absence of the parties being able to agree upon costs within one month of this judgment I order that the costs be fixed by the Registrar. 

DATED: 9 JANUARY 2013
J U D G E