Abdoolally Ebrahim & Co., (H.K.) Ltd. v. Formalex Ltd.

LDNT000043C/2000

LDNT43 OF 2000

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

New Tenancy Application No. 43 of 2000

 

BETWEEN
	Abdoolally Ebrahim & Co. (H.K.) Ltd.	Applicant
	AND
	Formalex Limited	Respondent

 

Coram: H.H. Judge Chow, Presiding Officer and Member W. K. LO

Date of hearing: 22 May 2001

Date of judgment: 5 June 2001

 

__________________

J U D G M E N T

__________________

 

Background

The Applicant is the tenant and the Respondent is the landlord of the subject premises known as Flat E on 41st Floor of Block 3 and Car Parking Space No. 233 on 2nd Floor, Estoril Court, 55 Garden Road, Mid-levels, Hong Kong ("the subject premises"). The subject premises was held under a tenancy for a term of 2 years from 16th April 1998 to 15th April 2000 at a rent of $110,000 per month, on the basis of exclusive of rates and management charges. In the Notice of Application (Form 22) dated 16th February 2000, the Applicant applied for an order for the granting of a new tenancy at such terms to be determined by the Tribunal. The Respondent opposed the application on the ground, inter alias, that the Applicant had persistently failed to pay the rents punctually on due date(s) since July 1999, causing unnecessary inconvenience to the Respondent.

2. On 6th July 2000, a preliminary hearing was held by the Tribunal to determine whether the Respondent succeeded in establishing any ground to oppose the application. On 4th August 2000, the Tribunal held that the Respondent had failed to do so and it granted the parties to the liberty to fix a date for the determination of the terms of the new tenancy. On 11th August 2000, the Applicant fixed a hearing on 3rd November 2000 for the said determination. Meanwhile, on 18th August 2000, the Respondent filed a Notice of Appeal against the judgment of the Tribunal delivered on 4th August 2000. On 5th October 2000, the Respondent took out a summons by which it applied for an order that the hearing date fixed on 3rd November 2000 be vacated. H.H. Judge Chow granted the application on 20th October 2000.

3. On 23rd January 2001, the Court of Appeal dismissed the Respondent's appeal.

4. An application was made by the Applicant for leave to fix a date for the determination of the terms of the new tenancy. The application was opposed by the Respondent and was heard by H.H. Judge Chow on 14th March 2001. The following orders were made on 20th March 2001:

(1) This case be heard on 21st and 22nd May 2001 at 10:00 a.m., Court No. 2 before a Presiding Officer and a Member of the Lands Tribunal.

(2) Parties are at liberty to file and serve further expert report/witness statements (if any) on or before 15th May 2001.

5. At the beginning of the hearing, the parties consented that the new tenancy shall be for a term of 2 years commencing from 16th April 2000 at a prevailing market rent (PMR) to be determined by the Tribunal but otherwise on the same terms as in the previous tenancy agreement entered into by the parties. Both parties also agreed that for the purpose of estimating the PMR at the relevant valuation date of 15th April 2000, the Tribunal shall assume that the air conditioning system for the subject premises was in a normal, reasonable state.

The Applicant's case

6. Mr. Ebrahim J. Abdoolally, a director of the Applicant, gave evidence. He had been residing in the subject premises since around November 1988. He gave evidence that previously the subject premises enjoyed unobstructed panoramic harbour view. Over the years, a number of buildings had since been erected and these had blocked the view from the subject premises. As a result, he could only see part of the harbour in between buildings. Also, he complained that the flow of water in the subject premises had not been constant.

7. The Applicant called for the evidence of an expert witness, Ms. Sat Wei Ling, Chartered Surveyor. Ms. Sat produced a valuation report, which can be found in page 25 to page 65 of Exhibit A1. Ms. Sat gave evidence that during her inspection, she had manually tested the water pressure of the subject premises by turning on and off the water taps of the baths and the sinks one by one. She had the observation that the water flow was slow.

8. Ms. Sat produced a revised summary sheet (produced as Exhibit A2) setting out the details of her valuation and the valuation of Mr. Ian R. C. Cullen, Chartered Valuation Surveyor, another expert witness. Ms. Sat considered and made reference to all her four comparables in the subject development originally set out in page 60 of Exhibit A1 as well as the fifth comparable which had been originally considered by Mr. Cullen but not by Ms. Sat:

Comparable (1) (same as Mr. Cullen's comparable Ref. 8.1): Flat B on 42th Floor & 1 car park

Comparable (2) (same as Mr. Cullen's comparable Ref. 8.2): Flat D on 24th Floor & 1 car park

Comparable (3) (same as Mr. Cullen's comparable Ref. 8.5): Flat D on 34th Floor & 1 car park

Comparable (4) (same as Mr. Cullen's comparable Ref. 8.3): Flat D on 35th Floor & 1 car park

Mr. Cullen's comparable Ref. 8.4: Flat D on 25th Floor & 1 car park

9. Ms. Sat adjusted the comparables for the factors of time, floor level, view and domestic appliances. After giving appropriate adjustments to the 5 comparables, she found that the comparables had after adjustment unit rates of $340.2, $358.9, $297.1, $349 and $296.9 per sq. m. respectively. After revising the weightings she gave to the various comparables, she arrived at a weighted average of $337.2 per sq. m. for the subject premises. She applied this weighted average to the agreed saleable area of the subject premises of 278.6 sq. m., giving an estimated rental value of $93,944. She further proposed one downward adjustment of 3% to reflect the low water pressure of the subject premises and she arrived at a value of $91,126 which she rounded to $91,000. This was Ms. Sat's estimated PMR for the subject premises.

The Respondent's case

10. The Respondent called for the evidence of an expert witness, Mr. Ian R. C. Cullen, Chartered Valuation Surveyor, who produced a valuation report which was in page 66 to page 111 of Exhibit A1. His comparables Ref. 8.1 to Ref. 8.5 show unadjusted unit rates of $348, $323, $330, $269 and $280 per sq. m. respectively. During the hearing, Mr. Cullen revised pages 82 and 83 of Exhibit A1, adding his adjustments to Ms. Sat's Comparable (3) and revising the weightings for his comparable Ref. 8.3. Mr. Cullen adjusted the comparables for the factors of time, appliances, floor level and view. The total adjustments he estimated for his comparables Ref. 8.1 to Ref. 8.5 were, in the order of his comparable, -0.23%, +22.36%, +19.6%, +20.33% and +19.93%.

11. In particular, Mr. Cullen's estimated adjustments for view alone accounted for +15% . Obviously, this factor was considered by Mr. Cullen to be the most important factor which had the most significant effect in his valuation. Mr. Cullen produced some photographs (Exhibits R3, R4 and R5) in support of his estimates for the sorts of view that the comparables might or might not enjoy. These photographs were taken from Mr. Cullen's office at 12th Floor of Baskerville House, 22 Ice House Street, Central, Hong Kong. Mr. Cullen also testified that he had walked from Central to Admiralty on foot in order to ascertain the sort of view that the comparables might command.

12. Mr. Cullen in his valuation arrived at adjusted unit rates of $347, $395, $395, $324 and $335 per sq. m. Mr. Cullen also revised his weightings for the comparables. In the final analysis, Mr. Cullen estimated the weighted unit rate of the comparables to be $357 per sq. m. Applying this to the saleable area of 278.6 sq. m. gives an estimated monthly rental value of $99,460. Therefore, he estimated the PMR for the subject premises to be $99,000.

Determination by the Tribunal

13. The two experts had considered the same 5 comparables before arriving at their estimates of the PMR for the subject premises. The estimates of Ms. Sat and Mr. Cullen were $91,000 and $98,000 respectively. Their difference was $7,000. On further analysis, we note that their main differences rested on their adjustments for view and whether or not an allowance should be given for the alleged low water pressure to the subject premises. Both Ms. Sat and Mr. Cullen gave very conflicting evidence as to whether or not the comparables enjoyed view similar to the subject premises and hence, the quantum of adjustment, if any, that should be given. Similarly, the two experts and the parties had diverging views as to whether an allowance should be made for the alleged situation of low water pressure.

14. However, without the benefit of actually viewing the subject premises and all the comparables and without direct evidence from the parties, we decide that it would be very difficult for the Tribunal to decide to accept exclusively either Ms. Sat or Mr. Cullen's opinion and hence their adjustments for the differences in the view from the comparables vis-à-vis the subject premises. During the hearing, the parties asked if the Tribunal would like to make an inspection of the subject premises. However, since the parties stated that they could not arrange for an inspection of any of the comparables, we decide that any such site inspection would not serve any useful purpose.

15. We note that both experts considered the best comparable to be Flat B on 42th Floor of the subject building, which is Ms. Sat's Comparable (1) or Mr. Cullen's comparble Ref. 8.1. This is evidenced by both the weightings the experts gave to this particular comparable, as well as the relatively small adjustments made to this comparable by the two experts. Mr. Sat gave a weighting of 4 for this comparable out of a total weighting of 10 for all 5 comparables, whilst Mr. Cullen's's respective figures were 6 out of 11. Mr. Sat estimated that a total adjustment of -2.3% to this comparable was appropriate and Mr. Cullen suggested an even lower total adjustment of -0.23%.

16. We find that although the comparables considered by the two experts were similar flats in the same development, Estoril Court, the parties had big differences in terms of the appropriate adjustments for view. Therefore, although it is not very desirable in general to rely on the evidence of a single comparable, out of a number of comparable properties, we find and decide in this case that we prefer to rely on the best comparable of "Flat B on 42th Floor" for the purpose of determining the PMR of the subject premises. We find that the use of this comparable will avoid the adoption of an adjustment percentage for the factor of view since it is common ground that both the subject premises and this comparable enjoy the same view, whether it is a panorama view as submitted by the Respondent or a restricted view as presented by the Applicant's witness. This is especially important since the Tribunal could not have the benefit of direct evidence from the parties as to the actual view that could be commanded from the comparables. The experts had worked diligently in order to gauge the sort of view that might be commanded. However, they were not able to have the opportunity of actually viewing from the comparables or similar flats from the same levels of the comparables. Hence, their evidence of view from the Central or Admiralty at different levels might only paint a limited picture of the reality of the actual situation for the comparables. It could well be that the experts were both right when they gave evidence that they estimated that the view from the comparables were of such and such magnitude. This was because they viewed the comparables from different locations at different levels and angles.

17. Next, we consider the details of the best comparable, Flat B on 42th Floor of Estoril Court. The tenancy for this comparable is a new tenancy for a term of 2 years commencing from 14th February 2000 at a rent of $97,000 per month, on exclusive basis. The two experts' adjustments to this comparable are set out below:

	Ms. Sat (the Applicant)	Ms. Cullen (the Respondent)
Time	0	0.4%
Floor	-0.3%	-0.33%
View	0	0
Domestic Applicance	-2%	-0.3%
Total Adjustment	-2.3%	-0.23%
Adjusted unit rate (per sq. m.)	$340.2	$347.4
Estimated PMR for the subject premise	$94,780	$96,786

18. We note that the differences in the adjustments of this comparable by both experts are quite small. Therefore, we decide to take the average of their estimated PMR for the subject premises, based on this comparable alone. This we calculate to be $95,783 which is rounded to $95,750.

19. Regarding the Applicant's submission that an allowance should be made to reflect the undesirable low water pressure situation for the subject premises, we agree with the Respondent that this is unnecessary. We consider that even if the Respondent's alleged problem exists, it will not affect the subject premises alone but will have a similar effect on other flats of similar floor level, including the comparable that we are considering.

20. Accordingly, we make the following orders:

Orders

1. New Tenancy for 2 years from 16th day of April 2000;

2. New rent at $95,750 per month (exclusive of rates and management charges); leave to the Respondent to pay the Applicant the over-payment of rent (if any) within 1 month;

3. Deposit to be adjusted pro rata in accordance with the new rent; leave to the Respondent to pay the Applicant the adjustment within 1 month;

4. Other terms of new tenancy same as in the previous tenancy agreement;

5. Regarding the trial of the preliminary issue conducted on 6th day of July 2000, the Tribunal makes an order nisi, to be made absolute in 14 days' time, that each party is to bear its own costs;

6. The Tribunal makes an order nisi, to be made absolute in 14 days' time, that there be no order as to costs for this new tenancy application.

 

 

(H. H. Judge Chow)	(W. K. LO)
Presiding Officer, Lands Tribunal	Member, Lands Tribunal

 

Representation:

Mr. A. B. Nasir of Messrs. A. B. Nasir & Co., for the Applicant

Ms. M. C. Chiu of Messrs. Therese P. F. Chow & Co., for the Respondent

LDNT000043B/2000

LDNT 43/2000

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

New Tenancy Application No. LDNT 43 of 2000

_______________

Between
	Abdoolally Ebrahim & Co. (H. K.) Ltd.	Applicant
	AND
	Formalex Limited	Respondent

_______________

Coram: H. H. Judge Chow, Presiding Officer of the Lands Tribunal

Date of Decision: 20 March 2001

 

______________

D E C I S I O N

______________

 

1. The Applicant is the statutory tenant of the premises known as Flat E, 41/F., Block 3 and Car Parking Space No. 233 on 2/F., Estoril Court, 55 Garden Road, Hong Kong which were under a tenancy for 2 years, running from 16.4.1998 to 15.4.2000. The Respondent is the landlord of the premises.

2. By way of summons dated 19.2.2001, the Applicant applied to the Lands Tribunal ("the Tribunal") for leave to fix a date for the determination of the terms of the new tenancy ("the Tribunal's case").

Background

3. On 16.2.2000, the Applicant applied to the Tribunal for an order for the grant of a new tenancy at such terms to be determined by the Tribunal. The Respondent opposed the application on the ground, inter alias, that the Applicant had persistently failed to pay the rents punctually on due date(s) since July 1999, causing unnecessary inconvenience to the Landlord.

4. On 6.7.2000, a preliminary hearing was held by the Tribunal to determine whether the Respondent succeeded in establishing any ground to oppose the application. On 4.8.2000, the Tribunal held that the Respondent had failed to do so and it granted the parties the liberty to fix a date for the determination of the terms of the new tenancy. On 11.8.2000, the Applicant's solicitors fixed a hearing on 3.11.2000 for the said determination. On 18.8.2000, the Respondent's solicitors filed a Notice of Appeal against the judgment of the Tribunal delivered on 4.8.2000. On 5.10.2000, the Respondent took out a summons by which it applied for an order that the hearing date fixed on 3.11.2000 be vacated. I granted the application on 20.10.2000.

5. On 23.1.2001, the Court of Appeal dismissed the Respondent's appeal.

The District Court case

6. On 24.10.2000, the Respondent instituted in the District Court a claim against the Applicant for a sum of $158,000-, the relevant parts of which are set out hereinbelow : -

"4. By a Tenancy Agreement dated 21 April 1998, the Plaintiff let the said property to the Defendant for the term of two years from 16 April 1998 (hereinafter called "the said Tenancy Agreement")

5. Clause 2(e) of the said Tenancy Agreement expressly provided, inter alia, that the Defendant agreed to keep the air-conditioning plant and ducting in good clean tenantable substantial and proper repair and condition and will so maintain the same at the expense of the Defendant.

6. Clause 2(h) of the said Tenancy Agreement expressly provided, inter alia, that the Defendant agreed to well and sufficiently repair and amend all defects and wants of repair for which the Defendant is liable within 30 days after notice in writing thereof given to the Defendant and in the event of the Defendant's failure to comply with any such notice in all respects the Defendant will permit the Plaintiff and its agent with or without workmen to enter upon the said property to remedy all or part of such defects or wants of repair at the cost and expense of the Defendant.

7. ................................................

8. ................................................

9. In breach of the said Clause 2(e), the Defendant failed to properly maintain at its expense the air-conditioning plant and ducting installed in the said property, and yet complained from time to time about the alleged malfunction of the said air-conditioning plant.

10. The Plaintiff served a notice dated 15 June 2000 on the Defendant in exercise of its right under the said Clause 2(h), requiring the Defendant to repair the air-conditioning plant within 30 days from 15 June 2000.

11. The Defendant failed to comply with the said notice of repair. After repeated demands from the Plaintiff, consent of allowing access was finally given by the Defendant on 4 September 2000. On 5 September 2000, the Plaintiff with technicians and workmen entered upon the said property and carried out the repair works to the said air-conditioning plant. The repair works were completed properly on 15 September 2000.

12. The total repairing charges totalled HK$158,000.00 of which the Defendant was given prior notice.

13. The Plaintiff paid the total sum of HK$158,000.00 on behalf of the Defendant to Associated HVAC Contracting Company Limited, ........................

14. ................................................

15. ................................................

16. The Defendant has neglected or failed to reimburse or pay the same or any part thereof."

(Underlines added)

7. On 17.11.2000, the Applicant filed in a defence and a counter-claim to the claim. No date has been fixed for the trial of that claim.

8. On 8.2.2001, the Applicant's solicitors wrote to the Respondent's solicitors, asking the latter to confirm that the Applicant could proceed to fix a date for the adjourned hearing at the Tribunal. On 13.2.2001, the Respondent's solicitors wrote back, stating : -

"Referring to your request to fix a hearing date for fixing rent in the Tribunal, we understand from the Registry that 21st and 22nd May 2001 are available. This is convenient to our Counsel and Surveyor.

Please confirm if such dates are also convenient to you as soon as possible."

9. On 14.2.2001, the Applicant's solicitors wrote to the Registrar of the Tribunal, requesting for a date to be fixed for the determination of the Tribunal's case.

10. On 16.2.2001, the Respondent's solicitors wrote to the Applicant's solicitors : -

" We refer to your letter of 14 February 2001 addressed to The Registrar, Lands Tribunal concerning attendance at the Registry at the Land Registry on 19 February 2001 at 10 a.m. to fix dates.

Our client, Formalex Ltd. has been advised its claim in District Court Action No. 14886 of 2000 against your client, Abdoolally Ebrahim & Co. (H.K.) Ltd. for recovery of HK$158,000.00 is fundamental to the determination of the responsibility of maintenance of the Air-conditioning System at the suit premises.

As District Court's determination may well prove to be most relevant to the determination of prevailing market rent in the Lands Tribunal, the hearing dates for the determination of the terms of the new tenancy in the Tribunal should not precede the District Court judgment.

As the parties are not procedurally ready to fix hearing date in the District Court, it is inappropriate to fix hearing date in the Tribunal on 19 February 2001 notwithstanding the liberty to fix date as contained in the Order of 4 August 2000.

Whilst our client has interest in obtaining an early conclusion of both outstanding hearings, we nevertheless request you to postpone the 19 February 2001 appointment to fix hearing date in the Lands Tribunal pending a likely judgment date from the District Court."

(Underlines added)

11. On 19.2.2001, the Applicant's solicitors took out the present summons.

12. The Respondent's Counsel opposed the application on the ground that the determination of the claim in the District Court would be relevant to the determination of the prevailing market rent of the new tenancy in the Tribunal. Therefore the District Court claim should be heard and judgment obtained before a hearing date is fixed for the determination of the Tribunal's case.

13. The issue I have to determine is whether the decision of the District Court claim would be relevant to the Tribunal's case, and if so, whether the hearing of the Tribunal's case should be fixed after the conclusion of the District Court case. This must necessarily involve a consideration of the functions and duties of the Tribunal. Having determined the preliminary issue on 4.8.2000 that the Respondent had failed to establish any ground to oppose the application, the Tribunal will inevitably make an order for the grant of a new tenancy. What will then follow is the determination of the duration of the new tenancy, other terms of the new tenancy and the amount of rent payable under the new tenancy, as stipulated under sections 119I, 119J and 119K of the Landlord and Tenant (Consolidation) Ordinance. These 3 sections are set out below : -

" 119I. Duration of new tenancy

Where on an application under this Part the Tribunal makes an order for the grant of a new tenancy, the new tenancy shall be such tenancy as may be agreed between the landlord and the tenant, or, in default of such an agreement, shall be such a tenancy as may be determined by the Tribunal to be reasonable in all the circumstances, being a tenancy for a term not exceeding 3 years, and shall begin on the coming to an end of the current tenancy or such other date as may be agreed between the landlord and the tenant or, in default of such agreement, as may be fixed by the Tribunal:

119J. Other terms of new tenancy

The terms of a tenancy granted by order of the Tribunal under this Part (other than terms as to the duration thereof and as to the rent payable thereunder) shall be such as may be agreed between the landlord and the tenant or as, in default of such agreement, may be determined by the Tribunal; and in determining those terms the Tribunal shall have regard to the terms of the current tenancy and to all relevant circumstances.

119K. Rent under new tenancy

(1) The rent payable under a new tenancy granted by order of the Tribunal shall be such as may be agreed between the landlord and tenant or as, in default of such agreement, may be determined by the Tribunal or by a valuation surveyor appointed by the Tribunal, to be a prevailing market rent."

14. In accordance with these three sections, the Tribunal has to ascertain if the parties will reach any agreement on the above-said matters. It is only in default of agreement that the Tribunal will proceed to do the necessary determination on these matters.

15. In the District Court case, the Respondent claimed against the Applicant for an amount of $158,000- for breach of Clause 2(e). I simply cannot see how this claim could have any bearing on the determination of the Tribunal's case. This claim covers the period between 15.6.2000 to 15.9.2000. Under Section 119I, in default of agreement between the parties, the Tribunal has to determine the commencement date of the new tenancy, which may be a date after 15.9.2000. Until this is known, it is premature to say that the outcome of the District Court case is relevant to the Tribunal's case. Under section 119J, when determining the terms of the new tenancy, in default of agreement between the parties, the Tribunal shall have regard to the terms of the current tenancy and to all circumstances. It is not known whether Clauses 2(e) and 2(h) of the current tenancy will be incorporated into the new tenancy. Unless and until this is known, it is premature to say that the District Court case will be relevant to the Tribunal's case.

16. The outcome of the District Court claim is not binding on the Tribunal. The Tribunal has the duty to determine the terms of the new tenancy in accordance with the evidence adduced before it.

17. The Tribunal's proceedings are part-heard proceedings which should be disposed of as soon as possible. The duration of the new tenancy cannot exceed 3 years. The usual duration granted by the Tribunal is 2 years. By the time this decision is handed down, nearly 1 year has elapsed since 15.4.2000, the expiry date of the current tenancy. It is not yet known when the parties will fix a trial date for the District Court case. It is highly undesirable to wait for the outcome of that claim when the Tribunal is fully competent to have all the matters in question determined by a Presiding officer and a Member who are specialized in adjudicating cases of this nature. There is absolutely no reason for the Tribunal to wait for the outcome of the District Court case before fixing a new hearing date. I therefore grant the Applicant's application and impose the following orders : -

1.) This case be heard on 21st and 22nd May, 2001 at 10:00 a.m., Court No. 2, before a Presiding Officer and a Member of the Lands Tribunal.

2.) Parties are at liberty to file and serve further expert report/witness statements (if any) on or before 15th May, 2001.

3.) The costs of and occasioned by this application be to the Applicant.

 

 

 

Representation:

The Applicant : represented by M/S AB Nasir & Co., Solicitors.

The Respondent : represented by M/S Therese P. F. Chow & Co., Solicitors.

LDNT000043A/2000

LDNT 43/2000

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

Lands Tribunal Application No. LDNT 43 of 2000

_______________

Between
	Abdoolally Ebrahim & Co., (H.K.) Ltd.	(Applicant)
	AND
	Formalex Limited	(Respondent)

_______________

Coram: H.H. Judge Chow, Presiding Officer

Date of Decision: 20 October 2000

 

_____________

Decision

_____________

 

1. The Applicant is the tenant of the premises known as Flat E, 41/F., Block 3 and Car Parking Space No. 233 on 2/F., Estoril Court, 55 Garden Road, Hong Kong which were under a tenancy for 2 years, running from 16.4.1998 to 15.4.2000. The Respondent is the landlord of the premises.

2. On 16.2.2000, the Applicant applied to the Lands Tribunal for the grant of a new tenancy. The Respondent opposed the application.

3. After hearing the evidence relating to the preliminary issue as to whether a new tenancy of the premises should be granted, this Tribunal adjudged on 4.8.2000 that the Respondent had failed to establish any ground to oppose the Applicant's application; it further granted the parties the liberty to fix a date for the determination of the terms of the new tenancy.

4. On 5.10.2000, the Respondent took out the present summons, by which it applied to the Lands Tribunal for the following order :-

(1) the hearing date fixed on 3 November be vacated;

(2) all proceedings herein before the Lands Tribunal be stayed until the Respondent's appeal therefrom (of which the Respondent has filed Notice of Appeal on 18th August 2000 under Civil Appeal No. 378 of 2000) is finally disposed of;

(3) the costs of and occasioned by this application be to the Respondent in any event."

5. By letter dated 7.8.2000, the Respondent's solicitors requested the Applicant's solicitors to send a clerk to the Lands Tribunal on 11.8.2000, for the purpose of fixing a date for the determination of the terms of the new tenancy.

6. By letter dated 9.8.2000, the Respondent's solicitors replied that the Respondent was waiting for Counsel's opinion on the Tribunal's decision handed down on 4.8.2000 with a view to appeal/review, and the time limit for appeal/review was 30 days from 4.8.2000. 11.8.2000 was too early for fixing a date for the hearing, and they suggested another date be arranged to attend before the Register of the Lands Tribunal.

7. On 11.8.2000, the Applicant's solicitors fixed a hearing on 3.11.2000.

8. On 12.8.2000, the Respondent's solicitors wrote to the Applicant's solicitors.

9. On 18.8.2000, the Respondent's solicitors filed a Notice of Appeal.

10. On 25.8.2000, the Respondent's solicitors wrote to the Applicant's solicitors, stating:-

"Your consent is sought (as ordered by H.H. Judge Chow) to vacate the date of 3 Nov. 2000. Please write separately to the Lands Tribunal without delay, with copy to us."

11. The Applicant's solicitors replied by letter date 28.8.2000 that they "await by the date given by the High Court on your civil appeal before we consider vacating the application before the Lands Tribunal on 3 November 2000."

12. On 19.9.2000, the Registrar of Civil Appeal fixed the hearing of the appeal on 16.11.2000.

13. By letter dated 19.9.2000, the Respondent's solicitors requested the Applicant's solicitors to vacate the hearing on 3.11.2000 as soon as possible, and by that letter they consented to the Applicant's application to vacate the said date.

14. By letter dated 20.9.2000, the Applicant's solicitors wrote back, stating that 3.11.2000 should be used for the hearing of an application for the interim rent.

15. On 22.9.2000 the Respondent's solicitors wrote back, stating that the Tribunal had no jurisdiction to determine the interim rent, and they requested the Applicant's solicitors to vacate the hearing date on 3.11.2000 forthwith.

16. On 28.9.2000 the Respondent's solicitors wrote to the Applicant's solicitors. In the letter it stated :-

'In the circumstances, the correct order to be sought from the Lands Tribunal is as follows :-

By agreement the parties seek an order for :-

(a) leave to vacate the hearing date fixed on 3 November 2000; and

(b) stay of proceedings in the above action until the Respondent's appeal under Civil Appeal No. 378 of 2000 has been finally disposed of."

Please re-type the joint application letter to the Registrar of Lands Tribunal and send it to us to endorse our consent thereon.'

17. On 28.9.2000, in reply to the Respondent's solicitors' letter dated 27.9.2000, the Applicant's solicitors stated :-

"We note that your client has not made an application to stay the Lands Tribunal proceedings. The order of H.H. Judge Chow and Member W.K. Lo of the Tribunal dated 4 August 2000 gives our client leave to proceed. However, we are instructed by our client that it is prepared to vacate the hearing date fixed at the Lands Tribunal further 3 November 2000 with a view to reducing the areas of dispute and costs."

18. On 29.9.2000, the Applicant's solicitors replied and suggested the following :-

"The parties do have leave to vacate the hearing date on 3 November 2000 with leave for either party to fix a date at any time after 16 December 2000."

19. By letter dated 29.9.2000, the Respondent's solicitors re-iterated that the proper consent order to be made are set out in terms of the last paragraph of their letter dated 28.9.2000 to the Applicant's solicitors. They repeated their request that the Applicant's solicitors sent them a joint application letter to vacate and stay by 30.9.2000, failing which they should take appropriate steps without further notice.

20. On 3.10.2000 the Respondent's solicitors wrote to Applicant's solicitors, and sought the latter's consent to vacate the said hearing date consenting to an order in the following terms :-

"By agreement the parties seek an order for leave to vacate the hearing date on 3 November 2000 and there be stay of proceeding until 16 December 2000 with leave for both parties to apply jointly to fix a date at any time after 16 December 2000."

21. On 3.10.2000 the Applicant's solicitors suggested the following order to be made :-

"The parties do have leave to vacate the hearing date on 3 November 2000 with leave for either party to fix a date at anytime after 16 December 2000, upon 7 clear days prior notification to the other party in writing."

22. On 5.10.2000 the Respondent's solicitors took out the present application.

23. When fixing a date for the determination of the terms of the new tenancy, the Applicant's solicitors was simply complying with the Tribunal's order made on 4.8.2000. It was under no legal obligation to wait and see if the Respondent would eventually lodge an appeal against the decision. In conclusion it was not at fault in fixing a date for the determination of the terms of the new tenancy.

24. Initially, the Respondent's solicitors simply asked the Applicant's solicitors to vacate the hearing date on 3.11.2000. The Applicant's solicitors eventually agreed on 28.9.2000 to vacate the same. Had the Respondent's solicitors agreed to it, that would have put on end to the matter. But the Respondent's solicitors would also ask for a stay of the proceedings until 16 December 2000 with leave for both parties to apply jointly to fix a date at any time after 16 December 2000.

25. The Civil appeal against the decision was fixed to be heard on 16.11.2000. The issue to be decided by the Court of Appeal was a simple issue. It may be disposed of on that very same day. 16 December 2000 may be too long a time for the stay of the proceedings, if the stay was really justified. This time limit imposes inflexibility to the legal proceedings. In view of the correspondence between the parties, it would simply be impracticable for the Tribunal to impose an order that both parties were to apply jointly to fix a date to any time after December. Again it imposes an element of inflexibility to the legal proceedings, particularly in view of the relationship between the parties. It would be sufficient for the Tribunal to give leave to the parties to apply for a new hearing date without the need for joint application.

26. By reason of the terms of para. (2) of the summons, these elements which cause inflexibility no longer exist. That is to say, the material part of the letter dated 3.10.2000 on which the Respondents obviously relies to support its application in the summons does not fully support Para. (2) of the summons.

27. I cannot see any necessity to order a stay of the proceedings. If the Applicant comes back to the Tribunal for a determination of the new tenancy before the decision of the appeal is disposed of, most probably the application may be dismissed with costs. In any event the possibility of such an application is remote in view of the fact that the civil appeal will be heard in less than 1 month's time.

28. Without the order of stay as applied for, parties would have more flexibility in handling their own case. In case of urgency, either party could come to court to make whatever application they see fit to do so. I therefore dismissed item (2) of the summons. The hearing date on 3 November 2000 was vacated, and leave was granted to the parties to apply to fix a new hearing date (if so required) in respect of the terms of the new tenancy after the final disposal of the appeal.

29. The Respondent should have consented to the applicant's proposal of the consent order as per Applicant's letters date 28.9.2000 and 3.10.2000. That would have obviated the necessity of coming to court.

30. The only issue for me to decide now is whether to award costs to the Respondent, on the application of its Counsel. By virtue of the matters aforesaid, the simple answer is "No".

31. In this case, being at no fault at all, the Applicant fixed a hearing date on 3.11.2000. It is due to the subsequent lodging of appeal against the decision that renders it inappropriate to hear the terms of the new tenancy on 3.11.2000, because the outcome of the appeal may render it unnecessary. It is simply more appropriate to postpone the hearing of the terms of the new tenancy after the disposal of appeal.

32. But parties would not agree to the terms of the order to be made in vacating the hearing date on 3.11.2000. The matter is triggered off because the date of the appeal was fixed by the High Court. This is beyond the control of both parties. Had it been fixed before 3.11.2000, the Respondent would not have to take out this summons.

33. In the circumstances, I order that in respect of this summons each party is to bear its own costs.

 

 

 

Representation:

Applicant : Represented by M/S AB Nasir & Co.

Respondent : Represented by M/S Therese P.F. Chow & Co.

LDNT000043/2000

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

New Tenancy Application No. LDNT 43 of 2000

_______________

Between
	Abdoolally Ebrahim & Co., (H.K.) Ltd.	(Applicant)
	AND
	Formalex Limited	(Respondent)

_______________

Coram:	H.H. Judge Chow, Presiding Officer
	Member W. K. Lo

Date of Judgment: 4 August 2000

 

_____________

Judgment

_____________

 

1. The Applicant is the tenant of the premises known as Flat E, 41/F, Block 3 and Car Parking Space No. 233 on 2/F, Estoril Court, 55 Garden Road, Hong Kong which were under a tenancy for 2 years, running from 16.4.1998 to 15.4.2000. The Respondent is the landlord of the premises.

2. Shortly after 11th October 1999, the Applicant received a notice of termination of tenancy (Form CR 101) from the Respondent to the effect that the tenancy of the premises would be terminated on 15.4.2000. The said notice further stated that the Respondent would oppose an application to the Lands Tribunal for the grant of a new tenancy on the following ground :-

"The Tenant has persistently failed to pay rent on due date(s), causing unnecessary annoyance, inconvenience or disturbance to the landlord and technically in breach of the Tenancy Agreement."

3. On or about 16.11.1999 the Applicant sent out to the Respondent Form CR 102, which was the tenant's response to landlord's notice of termination of tenancy.

4. On 20.10.1999, Tai Hing Management Ltd., apparently acting on behalf of the Respondent, sent a letter to the Applicant, which stated, "..... while on time rent payment of the Tenant is another matter, any delay in payment will constitute as an action of the breach of the Agreement". This clearly is the warning in writing served on the Applicant by the Respondent on 20 October 1999 as referred to in Paragraph 3 of the Notice of Opposition.

5. Section 119E of the Landlord and Tenant (Consolidation) Ordinance, Cap. 7 provides for the following grounds of opposition which may be relied on by a landlord to refute an application for a new tenancy by a tenant:-

"(1) The grounds on which a landlord may oppose an application under section 117(1) are such of the following grounds as may be stated in the landlord's notice under section 119, or, as the case may be, the notice under section 119A(6) ―

(a) ........................................................

(b) ........................................................

(c) ........................................................

(d) the tenant has caused unnecessary annoyance, inconvenience or disturbance to the landlord or to any other person :

Provided that no ground shall be established under this paragraph unless the Tribunal is satisfied that the annoyance, inconvenience or disturbance had continued after a warning in writing had been served by the landlord on the tenant causing the same;" (underlines provided)

6. Section 119E (3) stipulates that "for the purpose of subsection (1)(d), a tenant who persistently fails to pay rent as and when it falls due may be regarded as causing unnecessary inconvenience to the landlord."

7. Mr. Ebrahim Jaffer Abdeally who represented the Applicant in the trial admitted the following record of delayed payments of rent made by the Applicant :-

8. The ground relied upon by the Respondent to oppose the Applicant's application for a new tenancy is Section 119(E)(1)(d). Form CR 101 (dated 11.10.1999) was received by the Applicant shortly after 11.10.1999. But the notice of warning was dated 20.10.1999. Thus at the time when the Respondent purported to terminate the above-said tenancy by serving Form CR 101 on the Applicant and relied on the ground stated on the said notice for opposing the Applicant's application for a new tenancy, that ground did not exist at all, because up to that time, there had not been any warning in writing whatsoever, but section 119E(1)(d) expressly provides that no ground shall be established under paragraph (d) of section 119E(1) unless the annoyance, the inconvenience or disturbance had continued after a warning in writing had been served on the tenant.

9. For the above said reasons, the Tribunal decides that the Respondent has failed to establish any ground to oppose the present application instituted by the Applicant.

10. The Respondent is bound by the ground expressly stated in Form CR 101 for the termination of the tenancy. That notice could not be amended. Therefore the Tribunal refused the application to amend the notice of opposition at the commencement of the trial.

11. The Tribunal grants the parties the liberty to fix a date for the determination of the terms of the new tenancy, and further orders that the costs of the trial in respect of this preliminary issue be reserved.

 

 

 

Representation:

The Applicant : represented by M/S AB Nasir & Co.

The Respondent : represented by M/S Therese P.F. Chow & Co.

 

Remarks:
On appeal by the Respondent to the Court of Appeal: Appeal dismissed with costs. Please refer to CACV000378/2000.