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Colonial Cases

Pollak v. Shun Man Sun, 1894

[banking - employment]

Pollak v. Shun Man Sun

Supreme Court of China and Japan
Hannen CJ, 15 January 1894
Source: North China Herald, 19 January, 1894

Shanghai, 15h January.
Before N. J. Hannen, Esq., Chief Justice.
  This was an action by Mr. I. Pollak, of Shanghai, that a certain sum of Tls. 1,000, deposited in the Hongkong and Shanghai Bank, might be declared to belong to him. In December, 1892, Sun Mai-sun, the present defendant, instituted an action in the Austro-Hungarian Consular Court, claiming Tls. 923 from Mr. Pollak, on account of money advanced for the latter's business, and judgment was given in Shun Mai-sun's favour for Tls. 921.14.
  During the case it was stated that Shun Mai-sun on 1st May, 1892, entered Mr. Pollak's service as compradore at a salary of Tls. 50 per month and ½ per cent on the gross amount of all goods imported by the latter. Shun Mai-sun agreed to advance all monies for business purposes. Mr. Pollak alleged that Shun Mai-sun failed to carry out his agreement and that he purloined certain bills of lading which had considerably injured his (Mr. Pollak's) credit.  At about the time the agreement was signed Tls. 1,000 was deposited in the Hongkong and Shanghai Bank but there was a conflict of testimony as to whose money this was; and hence the present action. The plaintiff originally instituted his suit against the Bank, but by an order of the Court dated 14th June, 1893, Shun Mai-sun was substituted as the defendant.
  Mr. Pollak conducted his case in person, Mr. Brutton appearing for the defendant.
  Mr. Pollak applied for an adjournment as he had not been able to secure the attendance of some material witnesses.
  Mr. Brutton opposed the application. The plaintiff had been delaying matters for a considerable time, and it was exceedingly inconvenient to the defendant to be kept here in Shanghai.
  After some discussion,   
  His Lordship said the plaintiff had instituted the suit, the case had been adjourned for his convenience, and he should have been prepared with his evidence.
  Mr. Pollak proceeding to address the Court, said the Tls. 1,000 was deposited by him in the Bank as security for the carrying out of certain arrangements between the Bank and himself.
  Mr. Pollak was sworn and proceeded to explain how the defendant broke his agreement. He said that on 18th August, 1892, having given a native client a delivery order for 25 cases of blue he found the bills-of-lading in question were missing. He made inquiries and found that Shun Mai-sun had abstracted them. Plaintiff then endeavoured to institute proceedings in the Mixed Court, through the Austro-Hungarian Consulate, but the Mixed Court Magistrate replied in an official despatch that as there were other matters in dispute between the parties he could not interfere. The abstraction of those bills-of-lading seriously affected plaintiff's credit amongst the Chinese merchants, as the merchant in question, after having paid for the goods, was unable to get delivery. He estimated the damage he had suffered at Tls. 5,000. The abstraction of the bills of lading was a direct breach of the agreement.
  His Lordship - I must point out that at present you have not proved he took the bills-of-lading; you have merely said so.
  Plaintiff - I could prove it by the boy; he is not here, but if your Lordship could send a coolie he could be bought here.
  His Lordship - I am not here, nor is my Court here, to conduct your case for you; you must have known you had to prove certain things.
  The plaintiff was then cross-examined by Mr. Brutton.
  Mr. Pollak - Of course I must point out that I will only answer questions which have a bearing on this case.
  His Lordship - I beg your pardon, you will answer any question which I say you ought to answer.
  Plaintiff, in cross-examination, said at the time of signing the agreement with the compradore it was agreed that Tls. 1,000 should be deposited in the Hongkong and Shanghai Bank. The amount was deposited by the plaintiff according to the terms of the following letter to the Bank:
  "The bearer Mr. Shun Mai-sun begs to hand you Tls. 1,000 which kindly place on fixed deposit as security for the carrying out of my engagements. The amount cannot be withdrawn."
  The letter was signed by plaintiff and witnessed by the defendant and plaintiff's office-boy. Plaintiff sent the Tls. 1,000 to the Bank by native orders. Shun Mai-sun provided the money according to the agreement. The money was placed in plaintiff's name.
  Mr. Brutton - You admit Mr. Shun Mai-sun obtained that Tls. 1,000 and deposited it in the bank?
  Plaintiff - I do not admit it. I say he handed me Tls. 1,000 as part and parcel of a certain agreement I entered into with him, and he handed me this Tls. 1,000, which I placed in the Bank.
  Mr. Brutton - Did not Mr. Shun Mai-sun strongly object to the money being placed in your name, and did he not refuse to pay a certain account until you had placed the money in his name?
  Plaintiff - I can't remember.
  Mr. Brutton - Did you give Mr. Shun Mai-sun a cheque for the amount shown in the account (produced)?
  Plaintiff - Yes.
  Mr. Brutton - Is that the cheque (produced)?
  Plaintiff - Yes.
  Mr. Brutton - And was that cheque dishonoured?
  Plaintiff - Yes, there were certain drafts due and the Bank would not pay it. In reply to further questions, plaintiff said judgment had been given against him in the Austro-Hungarian Consular Court on the claim of Shun Mai-sun. Plaintiff had appealed against the judgment to the High Court in Trieste. He denied that he handed the bills of lading to the defendant as security for money then owing. Questioned as to what were his receipts at the time when he alleged he sustained the damage of Tls. 5,000, plaintiff said he could not say, and he did not consider it material to the case.  As a matter of fact his business left him almost entirely.
  Mr. Brutton - Was it not well known you were unable to pay Shin Mai-sun?
  Plaintiff - No.
  At this stage the Court adjourned for tiffin.
  Upon resuming,
  Plaintiff in further cross-examination said that after a time the defendant refused to advance any more money for the business until he was paid, and plaintiff then made him a guarantee. He then made further payments. According to the guarantee witness undertook to pay the defendant by certain monthly instalments. When the instalments became due defendant had violated his agreement and left the plaintiff's employ. Some time after plaintiff had commenced proceedings in the Mixed Court against the defendant, he received a letter from Mr. Drummond [demanding] payment of certain sums in default of Shun Mai-sun.
  Sung Taio-fung, the plaintiff's office-boy, was next called, with reference to the bills-of-lading in question. Witness said that a certain native merchant desiring to take possession of the goods, Mr. Pollak wanted the bills-of-lading, but they could not be found. Witness then went to Shun Mai-sun and asked him where the bills-of-lading were. He replied he had given them to a friend. The native merchant, who had paid for the goods, was very angry when he could not obtain them on account of the absence of the bills-of-lading.
  Plaintiff asked that the correspondence which had passed between the Austro-Hungarian Consulate and the Mixed Court relative to the alleged theft of the bills-of-lading might be read.
  His Lordship said he should not feel entitled to take this correspondence into consideration.
  The agreement between the plaintiff and the defendant having been put in, the plaintiff's case closed.
  Mr. Brutton, in opening the case for the defendant, pointed out that the agreement stated that Tls. 1,000 was to be deposited by Shun Mai-sun in the Bank "for the purpose of securing payments of drafts for goods imported through I. Pollak." The money was deposited, but the next day he found that it had been placed in Mr. Pollak's name. When the defendant found that out, he sent a shroff to remonstrate with the plaintiff.  That was on the Saturday before the Races, and the plaintiff said if the defendant would wait until after the Races he would write to the Bank requesting the transfer of the amount to defendant's name. Subsequently Mr. Pollak saw the defendant, explained it would be all right and that the money could be withdrawn within three months.
  His Lordship - It is not necessary to go any further. I do not see how Mr. Pollak can make out any case, once it is stated that the agreement is substantially the one under which the defendant entered the plaintiff's service. It says distinctly in that agreement that the Tls. 1,000 is to be deposited at the Hongkong and Shanghai Bank as security against any drafts.  That was evidently a security for the Bank, and it is not disputed by Mr. Pollak that Shun Mai-sun the compradore supplied that money.
  And now the whole of the business transaction between Mr. Pollak and the compradore have ceased, that money is no longer employed -  cannot any longer be employed - for the purpose of securing the Hongkong and Shanghai Bank against any money which is due them through Mr. Pollak because it is said distinctly that money is to be used for that purpose, and that purpose only. It would, manifestly, be quite against all reason that I should determine a dispute between Mr. Pollak and his compradore, neither being British subjects.
  All I have to do is to say whether the money which has been deposited with an Englishman should be paid to one or the other.  I do not say the compradore has not broken his contract; I do not say that you (Mr. Pollak) owe him money, but I say it is evident, from that agreement, that the money was placed in the Bank by the compradore for the purpose of securing the Bank against any losses, and it is stated distinctly in the agreement that the money is to be there for that purpose, and for that purpose only.
  I think that money ought to be handed back to the compradore, and so far as this case is concerned, Mr. Pollak having said all he has to say in the matter - I do not think it is necessary for you (Mr. Brutton) to go into the case any further. I do not think Mr. Pollak has made out his case, and I think the balance of the money ought to be handed over to the compradore.
  Mr. Brutton - Would you make an order as to costs?
    His Lordship - I shall make the ordinary order, but I do not think it is of any use. The order will be that I dismiss the petition of the plaintiff, with costs, and direct that the money in the hands of the Court be paid to the defendant.
(To Mr. Brutton) - You can draw it up in the form you think necessary.

Published by Centre for Comparative Law, History and Governance at Macquarie Law School