YEUNG KWAI YAN v. COOPER, JOHN GILES

HCA 10649/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 10649 OF 2000

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J U D G M E N T

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1.  This is an appeal by rehearing from an order made by the Registrar to pay out to the plaintiff funds paid into court by the defendant in partial satisfaction of the judgment debt.

2.  The appellant defendant has not appeared to prosecute the appeal, probably because he is on a trip to Europe with his family.

3.  The appeal was originally fixed to be heard on 16 June before another judge Deputy High Court Judge Au.  I note from the file that the defendant did not appear then either.  On that occasion the judge adjourned the case to this date 28 July before me, probably having read an e-mail that the defendant, unrepresented, had sent to the court on 10 June.  In it he stated that he would not be back in Hong Kong before the end of June, with his son requiring surgery in the US.  He requested that the appeal be rescheduled to a date to accommodate his return to Hong Kong in the first week in July.

4.  Having returned to Hong Kong and been told of the new date, he wrote to my clerk by letter of 13 July seeking by the letter a further adjournment until after his further return to Hong Kong in “the third week of December 2009”.  This clearly was intended to be December 2008.  In this letter he stated:

“I have already made plans to go on a trip to Europe starting on 14 July 2008”. 

There had been no reference to this trip in the earlier informal application to adjourn before Deputy Judge Au.

5.  The application, such as it was, was opposed, and I rejected it.  That decision was reported to the defendant by e-mail.  There was no response, and now no presence.

6.  I turn to the issues of the appeal itself.

7.  The plaintiff’s claim was as landlord against the defendant as tenant in default for repossession and rent.  Summary judgment was achieved in March 2005.  An extraordinary defence that the defendant had purchased the property, in which he produced an agreement and a receipt for the purchase price, resulted in his wife’s conviction for uttering forged documents and a sentence of suspended imprisonment.

8.  The defendant appealed the civil judgment.  The appeal was dismissed in July 2006.

9.  The defendant then sought leave to appeal to the Court of Final Appeal.  That was in due course refused.

10.  A possession order was executed in June 2007.  The defendant then paid into court the sum of $2,196,141.47 to settle the fi.fa. writ.

11.  The matter before the Registrar, and now me, is an application by the plaintiff for payment out of this sum.

12.  The defendant filed an affidavit in opposition to the effect that the plaintiff does not legally have the right to the said funds.  He deposed that the plaintiff had broken the law.  There is nothing further, and no support for these bare allegations. 

13.  Judgment has been entered.  An appeal to the Court of Appeal was lost and application for leave to appeal to the Court of Final Appeal was refused.

14.  There is no procedural or other defect which should prevent the plaintiff from having the funds paid into court to satisfy the judgment.  The Registrar was clearly right to grant the application.  The appeal is wholly unmeritorious and is dismissed.

(Following a discussion on costs)

15.  There will be costs on the indemnity scale to the plaintiff and that includes the costs reserved on 16 June 2008.

HCA10649/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO.10649 OF 2000

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BETWEEN

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Before : Hon Tang J in Chambers

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R E A S O N S  F O R  D E C I S I O N

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1. This action was commenced in December 2000.  Initially, the plaintiff claimed possession of the premises from the defendant.  The premises are government land which the plaintiff holds under a short term tenancy.  The claim for possession was based on forfeiture.  However, the claim was amended on 13 December 2001.  As amended it became a claim for payment of arrears of rent as well as for continuing rent.  The claim for forfeiture and for vacant possession was dropped.

2. By a summons dated 2 August 2004, the plaintiff applied for an order that “the Defendant shall forthwith demolish the unauthorized structures, namely, the storeroom, water pool and the fence and gate surrounding the Government Land Lot No.SX1871 at Hing Keng Shek, Sai Kung (also known as House No.36, Hing Keung Shek Village, Sai Kung) (‘the said Premises’), erected on the said Premises.”

3. That matter came before Sakhrani J on 6 August 2004.  The learned judge adjourned the hearing to 13 August 2004 so that the plaintiff could explain the delay in making the present application.

4. That the plaintiff has purported to do by the 5^th affirmation of Poon Lai Lee Lily where, according to her :

“6.   The reason why we had to take action to remove the fence and gate was because we have received a letter from the Lands Department in July 1998 requesting us to remove those unauthorized structures.  This letter has been exhibited in exhibit ‘PLLL-5’ of my 4^th Affirmation.  After the incident happened in 1998.  We no longer dare to take action ourselves in seeking to demolish the authorized structures.  The Lands Department’s stance at all material times had been very lenient and they made no threats of forfeiting the Short Term Agreement.

7.    In the meantime, the Defendant even failed to pay for the rent under the Tenancy Agreement.  I then sought legal advice.  We were advised that the Plaintiff could recover possession of the said Premises on the ground that the Defendant had failed to pay rent.  Summary judgment could confidently be obtained.  We intended to take out the present action and recover possession of the said Premises so that we could demolish those unauthorized structure thereafter.

8.    However, as we can see from the Defence and the affirmations filed by the Defendant and his wife, the Defendant has been denying that he was required to pay rent after the forged sale and purchase agreement.  I repeat paragraphs 11 to 14 of my 4^th affirmation.  Unexpectedly, we could not obtain the summary judgment.

9.    At no time was I or the Plaintiff advised by the Plaintiff’s former firms of solicitors that we could obtain a mandatory injunction ordering the Defendant to demolish the unauthorized structures.  The Plaintiff’s former solicitors only had liaised with the Lands Department.  Further, at no time (until last month) the Lands Department had threatened that it would forfeit the Short Term Tenancy.

10.  For these reasons, the Plaintiff had not applied for a mandatory injunction early.  As the circumstances now have changed, i.e. the Lands Department’s present intention to forfeit the Short Term Tenancy, I then sought the advice of the Plaintiff’s present solicitors.  They advised the Plaintiff that she should take out the mandatory injunction, hence the present application.  I therefore humbly pray that the Court to order in terms of the summons.”

5. At the hearing before me on 13 August 2004, I dismissed the plaintiff’s application with costs.

6. I do not believe that the circumstances warranted the making of an interlocutory mandatory injunction.  There has been substantial delay and the only excuse for the delay is that government has recently threatened not to renew the short term tenancy.  But the delay, since knowledge of the unauthorized structures in 1998, and the commencement of the action in 2000, is not so easily explained away.

7. Mr Patrick Chong who appeared on behalf of the plaintiff submitted that the defendant has no defence to the application for the removal of these structures.  With respect, that may not be right.  In so far as the plaintiff has affirmed the tenancy after the plaintiff became aware of the unauthorized structures, the defendant has an arguable case of waiver.  It is said that the defendant has not dealt with the unauthorized structures in his defence.  But that is understandable since up to date the plaintiff’s claim against the defendant is for rent and not for the removal of the unauthorized structures.

8. I note that there is a claim for damages for breach of the said Tenancy Agreement in the prayer to the Amended Statement of Claim but that claim does not seem to be related in any way to the unauthorized structures.  I have for convenience sake referred to the structures as being unauthorized.  They might indeed be unauthorized vis-à-vis government.  I do not know, on the material before me, whether they are unauthorized as between the plaintiff and the defendant.

9. I should also mention that in the defendant’s defence it is alleged that there was an agreement made between the plaintiff and the defendant for the sale of the plaintiff’s interest in the said premises to the defendant.  And the defendant relied on several documents as evidence of such a sale.  I understand that the defendant’s wife has been convicted on her own plea in relation to these documents which turned out to have been forged.

10. But whether the defendant has a defence to the claim for rent has little to do with whether or not I should made the order sought.  It will be recalled that the plaintiff’s claim under its Amended Statement of Claim is for rent and not for possession based on forfeiture of the tenancy.  If the defendant has no defence it only means that the defendant would be liable to pay the arrears of rent to the plaintiff.  It would not affect the defendant’s right to remain in possession of the property until such time as the defendant’s tenancy is forfeited.

11. As Snell on Equity, 30^th edition, put it in paragraph 45-49 “the court has jurisdiction to grant a mandatory injunction on an interim application before trial, but will very seldom do so; the court usually requires a high degree of assurance that at the trial it will appear that the injunction was rightly granted.”

12. I am afraid on the facts of this case I am far from satisfied that the plaintiff is entitled vis-à-vis the defendant to insist on the removal of the so-called unauthorized structures.  That is why the application was dismissed with costs.

13. Mr Chong has submitted that if the mandatory injunction were not granted, the government would terminate the short term tenancy.  Therefore, he says, to grant the mandatory injunction would put the parties in a win-win position.  The defendant opposed the making of the order.  And I had to approach this matter on the basis of the rights and obligations between the plaintiff and the defendant.