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Civil Action2012

CHIN LING INVESTMENT LTD v. THE GENERAL OF THE SALVATION ARMY

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105580-EN-2016-08-19

CHIN LING INVESTMENT LTD v. THE GENERAL OF THE SALVATION ARMY

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HCA 1/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1 OF 2012

____________

BETWEEN
 CHIN LING INVESTMENT LIMITEDPlaintiff

and

 THE GENERAL OF THE SALVATION ARMYDefendant

____________

Before: Deputy High Court Judge S T Poon in Court
Date of Hearing: 8 - 10, 14 April 2014
Date of Judgment: 19 August 2016

______________________

J U D G M E N T

______________________

BACKGROUND

1.  The Plaintiff and the Defendant are owners of two pieces of adjoining land.  The two pieces of land were originated from a single piece of land known as Lot No 181 in DD 390 (“Lot 181”), before its partition in 1958. 

2.  Lot 181 was situated between Sham Tseng and Tsuen Wan in an enclosed hilltop area at some distance from Castle Peak Road.  It was granted by the government to the then owners[1] in 1954 (“Grant 1954”).  Pursuant to the Grant 1954, the then owners and their successors were granted a right-of-way to pass over a strip of government land (“the Blue Strip”) for gaining access to and egress from Lot 181 to and from Castle Peak Road (“the 1st ROW”).

3.  By virtue of a Deed of Partition in 1958 (“DOP”), Lot 181 was partitioned to Section A of Lot No 181 in DD 390 (“Lot 181 SA”) and Remaining Portion of Lot No 181 in DD 390 (“Lot 181 RP”). 

4.  After the partition, Lot 181 SA became completely land-locked by Lot 181 RP.  Pursuant to the DOP[2], the then owner[3] of Lot 181 RP granted to the owner[4] and successors of Lot 181 SA “a free and uninterrupted right” (“the 2nd ROW”) to go pass and repass on along by and over a strip of land marked on a sketch attached thereto (“the Green Strip”). 

5.  The Defendant acquired Lot 181 RP in 1967 and the Plaintiff acquired Lot 181 SA in 1992.

6.  Therefore, at the material times, the Plaintiff enjoyed both the 1st ROW and the 2nd ROW as the owner of Lot 181 SA.  The 1st ROW entitled the Plaintiff to go pass the Blue Strip from Castle Peak Road to Lot 181 RP and the 2nd ROW entitled the Plaintiff to go pass the Green Strip, which is part of Lot 181 RP, to Lot 181 SA.

7.  By a Letter of Extension dated 16 June 2005 (“the Letter of Extension”), the Government granted to the Plaintiff a parcel of land adjacent to Lot 181 SA on payment of a premium (“the Extended Area”).  The relevance of the Extended Area will be explained later in this judgment.

8.  In or about mid-2011, the Defendant installed a metal gate (“the 2nd Gate”) on the Blue Strip at a position immediately outside the boundary of Lot 181 RP.  The reason why it is described here as “the 2nd Gate” is that the Defendant had once built[5] a first gate (“the 1st Gate”) on the Blue Strip at the same position but was demolished by the Defendant in 2006 upon the complaint of the Plaintiff.

9.  As the Defendant refused to demolish the 2ndGate, the Plaintiff commenced the present proceedings[6] seeking injunctive and other reliefs for the removal of the 2nd Gate.

10.  In March 2012, the Plaintiff applied for an interlocutory injunction in these proceedings and the application was heard before Deputy High Court Judge Burrell.  The learned Judge made an order to adjourn the Plaintiff’s summons sine die upon the Defendant’s undertaking to keep open the 2nd Gate at all times until further order.

11.  In August 2012, the District Land Office sent letters to the Plaintiff and the Defendant stating that there were unauthorized structures, including the 2nd Gate, built on government land and demanded those unauthorized structures to be demolished.

12.  In January 2013, the Plaintiff applied again for interlocutory injunctions.  The application was heard before Deputy Judge Ng.  The learned Judge ordered that the Plaintiff’s application be dismissed upon the undertaking by the Defendant to relocate the 2nd Gate to a position immediately within the boundary of Lot 181 RP and to keep it open all the times.

13.  In early 2013, the 2nd Gate was relocated by moving a few feet to a position within Lot 181 RP on the Green Strip (“the relocated 2nd Gate”).  The relocated 2nd Gate remained there at the time of this trial and has been kept open since then. 

THE PLAINTIFF’S CLAIMS AND THE DEFENDANT’S CASE

The 2ndGate

14.  The original complaint of the Plaintiff was based on the alleged interference of its rights by the Defendant’s building of the 2nd Gate on government land.  The Plaintiff avers that the erection of the 2nd Gate by the Defendant is an act of nuisance against the Plaintiff by way of interference with, disturbance of or annoyance to the Plaintiff in the exercise or enjoyment of the 1st ROW, the 2nd ROW, and the easement over the Green Strip and the Blue Strip.

15.  Pursuant to the order of Deputy Judge Ng, the 2nd Gate has been relocated to a position on the Green Strip, that is to say, the relocated 2nd Gate is no longer on government land and hence, the original complaint of the Plaintiff has been overtaken by events.  However, it would be relevant for this court to make findings on the Plaintiff’s claims in relation to the 2nd Gate and 1st ROW for the purpose of deciding the liability on costs. 

16.  The Plaintiff’s case is that the construction of the 2nd Gate on the Blue Strip by the Defendant constituted substantial interference with the Plaintiff’s enjoyment of the 1st ROW as a co-grantee.

17.  Regarding the 2nd Gate, Mr Yin[7], counsel for the Defendant, submitted that if a tenant encroaches on any land belonging to his landlord which is not part of the subject matter of the lease, the law presumes the encroachment to be an unilateral extension by the tenant of the locus of his existing tenancy and the additional land becomes subject to the terms of the lease as if it forms part of the land held under the lease[8].  It is Mr Yin’s view that this principle is applicable to the present situation as between the Defendant and the Government.  However, with respect to Mr Yin, I do not see how the principle can be of relevance in relation to the Defendant’s duty towards the Plaintiff as a co-grantee of the 1st ROW.

18.  In my view, the material issue as regards the Plaintiff’s original claim is whether the Defendant’s construction of the 2nd Gate constituted a substantial interference with the Plaintiff’s enjoyment of the 1st ROW which gives rise to a cause of action against the Defendant, as was in the situation of the case Jelbertv Davis[9].

The relocated 2ndGate

19.  Although the relocated 2nd Gate was moved just a few steps away from its original position, the legal basis of the Plaintiff’s claim is now very different.  The relocated 2nd Gate was built on the Green Strip and the 2nd ROW enjoyed by the Plaintiff was created by an express grant.  The Plaintiff is now suing the Defendant as the grantor rather than a co-grantee.

20.  As submitted by Mr Yin, the Defendant as the owner of the Green Strip can do anything to his land (as oppose to government land) unless it is a derogation from grant.  And to consider whether there is a derogation from grant, what was stipulated in the express grant would be of utmost importance.

21.  The Defendant’s primary case is that the construction of a gate on the Green Strip is not in itself a derogation from the express grant. 

22.  Besides, the Defendant maintains that the Extended Area does not enjoy the 2nd ROW and as the Plaintiff is seeking injunctive relief on the basis of an alleged right to use the Green Strip not only for the benefit of Lot 181 SA but the combined site including the Extended Area, the Plaintiff cannot succeed with its claim unless it can show that its rights on the 2nd ROW somehow extends to include the Extended Area. 

23.  In its counterclaim, the Defendant seeks declarations to the effect that the 2nd ROW cannot be used for the enjoyment of the Extended Area and further that the Plaintiff has no rights to enjoy the 2nd ROW for any part of Lot 181 SA as it is for the time being occupied together with the Extended Area as an indivisible whole.

The Extended Area

24.  It is the Plaintiff’s case that the Extended Area had long been occupied and used by the predecessors-in-title of the Plaintiff in Lot 181 SA as a private garden under a Crown Land Permit since 1st October 1968 and thereafter under a series of short term tenancies.

25.  Pursuant to the Letter of Extension, the Extended Area could only be used as a private garden by the owner of Lot 181 SA.  The Plaintiff maintains that the Extended Area is thus merely ancillary to the enjoyment of Lot 181 SA.

26.  In its Amended Defence to Counterclaim, the Plaintiff pleaded that “the user of the Extended Area and/or the Private Garden Area for the purpose of Lot 181 SA is reasonably necessary and falls within the scope and extent of the right of way granted under the Deed of Partition and/or doctrine of lost modern grant and/or by way of prescription and/or by implied grant under the Deed of Partition.” 

27.  Further and in the alternative, the Plaintiff says that the Defendant or its predecessor-in-title had never complained of or taken any action against the Plaintiff or its predecessor-in-title that the Extended Area had any impact on the servient tenement of the 2nd ROW and such inaction constituted an unequivocal representation by the Defendant that the Plaintiff was and is entitled to use the Green Strip to gain access or egress from the Extended Area.  In reliance on the Defendant’s representation, the Plaintiff applied to the Government for grant of the Extended Area and paid HK$1,168,650 as premium.  The Plaintiff avers that the Defendant is thereby estopped from denying the Plaintiff’s rights to use the Green Strip to gain access or egress from the Extended Area.

FACTUAL ISSUES

28.  There are not too many factual issues in this trial. 

29.  Witnesses of the Defendant gave evidence that an iron gate at the position of the 1st Gate existed in or before 1972.  It is however the Plaintiff’s case that no similar iron gate was noticed until 2005.

30.  There is a dispute as to whether stray dogs and wild boars caused problems to the Defendant’s lot and whether illegal vehicular parking occurred in the vicinity.  The Defendant said this is the reason why they maintained the 1st Gate and why they reinstated the 2nd Gate. 

31.  Besides, there are some disputes as to how the 1st and 2nd Gates had been operated, in particular, whether and when the remote control of the 1st Gate has been provided to the Plaintiff and whether the gates can be conveniently opened from outside. 

32.  There is also a dispute as to whether and when the Extended Area has been used by the Plaintiff or its predecessor-in-title and whether and for how long the Blue and Green Strips have been used to access to and egress from the Extended Area. Parties considered it relevant to the question of whether the Plaintiff can obtain the right of way for access and egress to the Extended Area by prescription.

33.  Other evidence has been given by witnesses from both sides which is not much in dispute.

34.  Much has been said by the Plaintiff’s witnesses on the previous negotiations of the parties on a joint redevelopment of the subject properties.  Apart from providing a more complete background on the parties’ dealings I do not find such evidence helpful for determination of the present dispute. 

35.  There is another legal dispute between the parties regarding an alleged trespass to the Defendant’s land by a wooden hut built by the Plaintiff on the boundary of the two lots. In 2011, The Defendant took out an Order 113 action[10] against the Plaintiff and following which the Plaintiff’s wooden hut was demolished.  Apart from showing that the parties’ relationship was not in an amicable state at that time this is of limited relevance to the present proceedings.

EVIDENCE AND FINDINGS

When was the 1st Gate built?

36.  The Defendant is a charitable body and Lot 181 RP has long been used as the quarters for its senior officials.  The property situated on the lot, which is a two-storey house, is named “Pink Villa”.  In this trial, 3 senior officers of the Defendant who had resided in Pink Villa during different period of time gave evidence for the Defendant. 

37.  Commissioner Lim Ah-An, who resided in Pink Villa between 1983 and 1990, said he believed there was a similar metal gate installed at or around the position of the 1st Gate during the time he resided there.  To his memory, the metal gate was always left open. 

38.  Colonel Alice Lau, a former officer of the Defendant, resided at the Pink Villa with her husband between 1993 and 1999, said she remembers clearly that there was such a gate at the entrance throughout the period of her stay. 

39.  Major Fona Ling, who resided at Pink Villa between 1999 and 2002, said during her stay there was at all times a gate standing at the entrance of Lot 181 RP and the gate was never locked.  She also said at that time the old house on Lot 181 SA has already been demolished.  Lot 181 SA was covered by tall grass and she did not notice anyone taking care of the land.  There were also stray dogs and monkeys appearing and their excrements were often found in the two lots of land.  She also saw the residents of “Golden Villa”[11] walking their dogs on Lot 181 SA.

40.  Mr Chan Chee Ho, who served the Defendant as gardener since 1999, said throughout his work in Pink Villa for more than 10 years there was an iron gate installed at the entrance of Lot 181 RP.

41.  On the other hand, Ms Sarena Young, a director of the Plaintiff, said she did not see any gate at the entrance of Lot 181 RP in her three visits to the site before the Plaintiff’s acquisition of Lot 181 SA in 1992.  She said on each and every occasion her car was driven up the hill to Lot 181 SA without stopping to open any gate.  Had there been any metal gate in existence then, as the handling solicitor of the acquisition for the Plaintiff and also the Plaintiff’s director, she would have raised requisition with the previous owner about the gate. 

42.  Ms Wong Mun Yee, who was assigned by the Plaintiff to attend to Lot 181 SA soon after its acquisition, said that a goods vehicle was called to the site to remove unused building materials at that time and the goods vehicle could enter into Lot 181 SA without stopping to open any gate.  She did not recall seeing the 1st Gate at that time.

43.  Apart from the above factual witnesses, the parties also relied on the opinions of surveyors with reference to archived aerial photographs and sketches.

44.  Having considered the evidence, I find it more probable that the 1st Gate was in existence at least before 1988, if not as early as in 1972.

45.  I have given full weight to the evidence of the senior officials of the Defendant who had resided in Pink Villa.  They are the ones most familiar with the environment of Lot 181 RP and the vicinity during their respective periods of stay.  I can see no personal interest of them in the present proceedings and have no reason to doubt their evidence.

46.  On the contrary, the evidence of Ms Young and Ms Wong of not seeing any gate is only derived from their impression formed at their relatively brief visits to the site.  If the gate was kept open during their visits, which I find very probable, they could have formed the same impression as there being no gate at all.  I do not find their evidence reliable in this regard.

47.  I find the archived records and aerial photos kept in the Land Registry, as commented by the Defendant’s surveyor, consistent with the fact that the 1st Gate or a similar gate had been in existence at its location since 1972.

48.  However, it is also my finding that the gate was always left open since its construction until 2005 when the Defendant found it necessary to keep the gate closed most of the time.

Stray dogs and illegal parking

49.  As mentioned above, it is Major Fona Ling’s evidence that there were stray dogs and monkeys appearing at Lot 181 RP during 1999 to 2002. 

50.  The subject properties are located on the hill top in rural area with a few houses situated around. In my view, it would not be unusual that stray dogs and other common wild animals in Hong Kong, including monkeys and wild boars, would appear in the area.

51.  Mr Yin submitted that any vehicles found parked at Lot 181 SA or in the vicinity can only be vehicles of the guests or owners of Golden Villa.  I find this a logical deduction as I agree that given the location of the subject properties it would be too inconvenient for anyone else to choose to park their vehicles there.  However, it is still parking without proper authorities and the fact that they are vehicles of the guests or owners of Golden Villa makes no difference.

52.  I find as facts that stray dogs, wild animals and illegal vehicular parking did occur at Lot 181 SA.  

53.  Having found as such, however, I do not find it of much relevance to the ultimate issues I need to determine in these proceedings. 

Use of the ROWs for the Extended Area

54.  The Extended Area granted under the Letter of Extension is about 191square metres.  From the plan attached to the 1954 Grant and also the plan attached to the DOP, a strip of flat land at the same position of the Extended Area can be seen extending from Lot 181 SA towards the edge of the hill.  As such, it is the Plaintiff’s case that the area has long been used by the owners of Lot 181 and 181 SA as their private garden.

55.  Under a Crown Land Permit in 1968 (“the Crown Land Permit”) and two subsequent Short Term Tenancies[12] (“the STT”), the area was permitted by the Government to be occupied and used by the owners of Lot 181 SA.  Structures including a pool and a pavilion are expressly permitted to be constructed on the area under the Crown Land Permit and STTs. 

56.  There are aerial photos produced showing a swimming pool built on the Extended Area started at least from 1985.  From an aerial photo in 1990, new structures can be seen constructed on the area.  On 26 June 1991, a Building Order was issued to the then owner requesting a swimming pool and associated building works on the Extended Area to be removed or demolished.

57.  It is quite apparent from the evidence that the Extended Area had been on and off used as a private garden for a long period of time.

58.  However, as highlighted by Mr Yin, the Crown Land Permit is only related to an area of 1440 sq ft. for a period between 1 October 1968 and 31 December 1968.  There is no evidence of any permitted occupation between the end of 1968 and October 1992.  If only the periods of occupation of the Extended Area under the STTs are counted, the total period of occupation will be 8 months short of 20 years[13].

59.  Besides, aerial photos between 1993 and 2011 show that the vegetation over the Extended Area was so overgrown that the Extended Area was inaccessible altogether.  This is also consistent with the undisputed evidence that the whole of Lot 181 SA and the Extended Area were vacant throughout this period of time.

60.  Having considered the evidence as a whole, particularly the aerial photos produced, I am satisfied on balance that the Extended Area or a substantial part thereof had been occupied and used by the owners of Lot 181 SA as a private garden at least in the period between 1958 and 1991.  I also find that before the petition of Lot 181, as from the grant in 1954, the Extended Area had all along been used as a private garden.

61.  As such, the Blue Strip and also the Green Strip could have been used, via Lot 181 SA, to access to and egress from the Extended Area during the abovementioned period of time. Furthermore, as the Extended Area was used by the owner of Lot 181 as his private garden at the time of the DOP and it was completely land-locked by Lot 181 SA and 181 RP, it must be the intention of the parties of the DOP that the owner of Lot 181 SA can enjoy the 2nd ROW to access to and egress from the Extended Area, through Lot 181 SA.

62.  Having heard the evidence, it is also my finding that the Plaintiff and the Defendant were initially in good terms and they had explored twice the possibility of a joint redevelopment of the two lots in 1993 and 1997.  However, the project was aborted for various reasons and Lot 181 SA was then left deserted.  The deserted Lot 181 SA caused hygienic and security concerns to the owners of Pink Villa and Golden Villa, so much so that the Defendant had once the idea of buying out the Plaintiff’s land in 2002.  The relationships between the Plaintiff and the Defendant turned sour in 2005 following the incident of Ms Wong being blocked out by the 1st Gate.  There were continuous complaints by the Defendant about the conditions of Lot 181 SA and the heat between the parties escalated to the highest when the Defendant instituted the Order 113 proceedings against the Plaintiff in 2011. 

DISCUSSION

The 2nd Gate

63.  The Plaintiff and the Defendant are co-grantees of the 1st ROW by the government.  The right granted by the government to them is to use the Blue Strip to access to and egress from their respective land.  They have no right to build anything on the Blue Strip without the government’s consent.   

64.  In JelbertvDavis[14], it was held that a co-grantee is not entitled to use the right of way to an extent which exceeded what was contemplated at the time of the grant and so as to interfere unreasonably with the enjoyment of the like right by others entitled to it. 

65.  In the present case, the building of a gate on the Blue Strip could not be within the contemplation of the government or any party at the time of the grant in 1954.  The fact that the government demanded in 2012 to demolish the unauthorized structures on government land evidenced the same.

66.  In my view, the building of a gate on the Blue Strip constituted a substantial interference to the Plaintiff’s enjoyment of the 1st ROW. 

67.  The Defendant has no right to build the 2nd Gate on the Blue Strip.  The reason behind the Defendant’s decision to build such gate is simply irrelevant.  

68.  Although the 1st Gate was in existence for a long period of time, it was always left open that caused little inconvenience to the owners of Lot 181 SA.  In 2005, the Defendant evinced an intention to start closing the gate which led to the unpleasant experiences encountered by Ms Wong.

69.  In my judgment, a mandatory injunction ought to be granted ordering the Defendant to demolish the 2nd Gate.

The relocated 2nd Gate

70.  Relied on the English Court of Appeal’s decision in Pettey v Parsons[15], Mr Yin submitted that the servient owner cannot be deprived of the right to erect and maintain a gate at the entrance to his property just because he has granted a right-of-way over his land.

71.  Mr Yin referred to an Australian decision Owners Corporation of Strata Plan 42472 v Menala Pty Ltd[16] where it was held that there is a natural presumption that the servient owner should be entitled to fence his land[17].

72.  Mr Yin also quoted the observation of Godfrey, JA in Lea Tai Property Development Ltd v I O of Leapoint Industrial Building[18]:

“where the case is one of interference with an easement, the position is somewhat different. There, the owner of the dominant tenement has no absolute right to use each and every portion of the right of way. He is entitled to complain only of substantial interference with that right by the owner of the servient tenement. The owner of the servient tenement is the owner of the land and is accordingly entitled to use it for whatever purposes he likes, so long as he does not substantially interfere with the use of the way by the owner of the dominant tenement.”

73.  Mr Yin emphasized that the complaint of the Plaintiff is not directed against any particular mode of operation of the gate but the very presence of the gate.  He submitted that the onus is on the Plaintiff to make out a case of “substantial interference” with its right-of-way and there is no obligation on the Defendant to justify their need to have the gate at the entrance to its property.  Mr Yin said further that, even if any justification is required, it is self-evident that the gate is needed to mark the boundary of Lot 181 RP and warn off trespassers from the Defendant’s private property (which includes not just the areas occupied by the house and the gardens but also the area over which the Plaintiff enjoys a right-of-way).

74.  While I entirely agree with the legal principles as set out by the legal authorities cited by Mr Yin, it is my view that the principles should be applied in the light of the express grant under the 2nd ROW in the present case.

75.  In other words, what I should consider is not whether there is any substantial interference to the Plaintiff’s use of the Green Strip in isolation but whether the installation of the relocated 2nd Gate interfered substantially with the Plaintiff’s “free and uninterrupted right” to go pass and repass on along by and over the Green Strip. 

76.  I agree with Mr Yin that on this point whether there is justification for the Defendant to build the gate is of no significance.  On the other hand, I do not agree with Mr Yin that there is an obvious need for the Defendant to build the Relocated 2nd Gate at its position in order to “mark the boundary and warn off trespassers”. 

77.  If the Defendant sees fit to build a gate to mark the boundary or warn off trespassers, there is nothing to stop them from building a gate within the boundary of Lot 181 RP but not on the Green Strip.  This must result in eating into the area of 181 RP but, although the Green Strip is the Defendant’s private property, the use of which by the Defendant is subject to the 2nd ROW enjoyed by the Plaintiff.  The Defendant cannot insist on its own rights at the expense of the others.

78.  As submitted by Mr Alan Leong SC[19], counsel for the Plaintiff, it is trite law that if there is an express grant, the starting point must primarily be the language of the grant and circumstances at the time of execution of the grant[20].

79.  It is expressly stipulated under the DOP that the right enjoyed by the Plaintiff is a “free and uninterrupted” right.  In my view, if the right to use the Green Strip as passage is subject to the provision of a key or automatic device by the Defendant to open a gate, it can hardly be described as a “free and uninterrupted” right to pass.  Besides, as submitted by Mr Leong, to require the Plaintiff to stop their vehicles in order to open the gates either by hand or with automated devices is also inconsistent with a “free and uninterrupted” right. 

80.  With respect, the argument of Mr Yin that the complaint of the Plaintiff is not directed against any particular mode of operation of the gate but the very presence of the gate is a fine one but unrealistic.  The very purpose of a gate is to fend off others and to achieve such purpose the gate must be closed at least when it is required.  This will result in a derogation of the grant on the part of the Defendant. 

81.  In my judgment, the building of a gate on the Green Strip is a derogation of the grant under the DOP.

THE EXTENDED AREA

82.  It is the Defendant’s case that the Plaintiff lost the original grant under the DOP as soon as the Plaintiff started to make use of the Green Strip to access the Extended Area.  Mr Yin submitted that the Plaintiff has by the addition of the Extended Area enlarged the dominant tenement without the agreement of the Defendant, which is impermissible in law[21].

83.  Mr Yin distinguished between the case where the dominant owner is seeking to make use of a right-of-way to access land which is ancillary to the use of the way and the case where the dominant owner is seeking to make use of the right-of-way to access land which is ancillary to the enjoyment of the dominant tenement.  In his submission, the former is permissible while the latter is not[22].

84.  I agree with Mr Yin that in principle, the Plaintiff could not enlarge the dominant tenement of the 2nd ROW without the consent of the Defendant.  Nonetheless, it is my view that the addition of the Extended Area to Lot 181 SA does not necessarily mean that the dominant tenement of the 2nd ROW is thereby enlarged.

85.  I have found earlier that at the time of the DOP it must be the intention of the parties of the DOP that the owner of Lot 181 SA can enjoy the 2nd ROW to access to and egress from the Extended Area through Lot 181 SA.  As such, the fact that the Extended Area is now legally owned by the same owner of Lot 181 SA and permitted to be used only as a private garden, does not in any way enlarge the dominant tenement of the 2nd ROW.

86.  The Plaintiff has the right to use the Green Strip to access to Lot 181 SA under the 2nd ROW and it will then be up to him/her whether to access to any other area beyond Lot 181 SA including the Extended Area thereafter.  I can see no reason why the Plaintiff would lose the original grant under the DOP by legally acquiring the Extended Area or by access to or egress from the Extended Area through Lot 181 SA. 

87.  I note Mr Yin’s argument that the Plaintiff is suing in the capacity of the owner of Lot 181 SA and the extension.  With my above findings I do not see any practical difference between the Plaintiff suing as the owner of Lot 181 SA or the owner of Lot 181 SA and the extension.  The Plaintiff can simply assert its rights under the 2nd ROW as the owner of Lot 181 SA without involving its legal ownership of the Extended Area.  Any problem that may arise is technical and should be disregarded in view of overall justice. 

88.  It is unnecessary for the Plaintiff to acquire any separate right-of-way for the Extended Area in order to enforce its rights as the owner of Lot 181 SA.

89.  The Extended Area has always been used by the owners of Lot 181 SA as a private garden.  In my view, it would be artificial to suggest that a separate right-of-way can be acquired by way of lost modern grant in favour of the Extended Area only.  It is not necessary to make a finding on the issue of lost modern grant in view of my rulings but if I were to make such finding, I would find that the Plaintiff failed to establish the continuous user of the Green Strip to access to and egress from specifically the Extended Area.

90.  Regarding whether the Defendant is estopped from denying the Plaintiff’s rights to use the Green Strip to gain access or egress from the Extended Area, I agree with Mr Yin that there is no evidence that the Defendant had ever made any representation to induce the Plaintiff to apply for the Letter of Extension in 2005 or the Plaintiff had ever relied on such representation.  The Plaintiff’s plea of estoppel must therefore fail.

DISPOSITIONS

91.  Accordingly, a mandatory injunction is granted against the Defendant to demolish forthwith the Relocated 2nd Gate.

92.  The Defendant be restrained from, whether by itself or its proxy, agent or servant or howsoever, from erecting any gate at the area on the Blue Strip and/or the Green Strip.

93.  The Defendant’s counterclaims be dismissed.

94.  I make a costs order nisi that costs of the proceedings be to the Plaintiff to be taxed if not agreed.  This costs order nisi shall become absolute upon the expiry of 14 days from the date of this judgment unless there is any application from any party for variation of the same.

95.  I thank counsel for their able assistance.

 (S T Poon)
Deputy High Court Judge
Court of First Instance

Mr Alan LEONG, SC and Mr Matthew TSE, instructed by Messrs Christine FL Ip & Young, for the Plaintiff

Mr Michael YIN and Mr Issac CHAN, instructed by Messrs Wilkinson & Grist, for the Defendant



[1] Co-owned by Kwan Lip Fun and Lau Pik Fan.

[2] Clause 2

[3] Lau Pik Fan

[4] And the owner’s tenants, servants, visitors and other persons authorized by him.

[5] There is a dispute of fact as to when the 1st Gate was built.

[6] In January 2012

[7] Leading Mr Issac Chan.

[8]Gray’s Elements of Land Law 5th Ed (2009) at 9.1.61; SJ v Chau Ka Chik Tso (2011) 14 HKCFAR 889 at 903.

[9] [1968] 1 All ER 1182

[10] HCMP 1967 of 2011

[11] A private development of 6 semi-detached houses situated in Lot 201, a plot of land nearby Lot 181on the same hilltop.  Owners of Golden Villa also enjoyed a right-of-way to use the Blue Strip to access to their properties from Castle Peak Road.  In November 1992, upon the suggestion of the owners of Golden Villa, a main metal gate was built at the entrance to the slip road abutting Castle Peak Road with funds contributed by the Plaintiff, the Defendant and the owners of Golden Villa in equal share.  The main metal gate was demolished in 2012 apparently following the demand of the government to demolish unauthorized structures built on government land.

[12] STT No 1074 TW and STT No 1156 TW

[13] October 1992 to February 2012.

[14]Supra

[15] [1914] 2 Ch 653

[16] (BC9802461), unreported

[17] at 9 to 12

[18] [1996] 1 HKC 193 at p 198B-C

[19] Leading Mr Mathew Tse.

[20]Cannon v Villars(1878) 8 Ch D 415 at 420.

[21]Peacock v Custins[2001] 2 All ER 827

[22]Das v Linden Mews Ltd[2003] 2 P & CR 58

85900-EN-2013-02-25

CHIN LING INVESTMENT LTD v. THE GENERAL OF THE SALVATION ARMY

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HCA 1/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1 OF 2012

____________

BETWEEN

 CHIN LING INVESTMENT LIMITEDPlaintiff

and

 THE GENERAL OF THE SALVATION ARMYDefendant

____________

Before: Deputy High Court Judge in Chambers
Date of plaintiff’s Statements of Cost: 30 January 2013
Date of defendant’s Statement of Cost: 30 January 2013
Date of plaintiff’s List of Objections: 4 February 2013
Date of defendant’s List of Objections: 6 February 2013
Date of Decision (paper disposal): 25 February 2013

___________________________________

DECISION ON ASSESSMENT OF COSTS

___________________________________

 

1.  The costs to be assessed are (a) the plaintiff’s costs of the defendant’s summons dated 21 January 2013, and (b) the defendant’s costs of the plaintiff’s summons dated 15 January 2013. The 2 summonses were heard by me on 25 January 2013 (“Hearing”). At the Hearing, I also ordered that for the avoidance of doubt, ⅓ of the time spent on the Hearing be apportioned for the defendant’s summons. Various affirmations were filed by the parties for the purpose of the 2 summonses.

2.  At the Hearing, I directed for summary assessment of the above costs orders.  I also rejected the defendant’s application for costs on an indemnity basis, so both parties’ costs are awarded on party and party basis.  As such, only costs that are necessary or proper for the attainment of justice or for enforcing or defending the taxing party’s rights will be allowed (see Order 62 rule 28(2) of the Rules of the High Court).

I.  DEFENDANT’S COSTS

3.  General information  There is no dispute that the hourly rates of HK$4,000.00 (ALM – partner) and HK$2,500.00 (DOL – associate) are appropriate. I do not agree with the suggestion by the plaintiff’s solicitors that the whole of DOL’s time should be disallowed for reason of duplication.  In my view, it is eminently sensible for a partner to delegate appropriate tasks to an associate and only assume a supervisory role over such tasks in order to keep costs to a level that is necessary or proper.  However, I accept that duplication of work which is not necessary or proper under party and party taxation should be disallowed.

4.  Item B1 Photocopy charges should be reduced to HK$1,500.00 at HK$1.00 per page.

5.  Item C1  The defendant’s affirmations in respect of the plaintiff’s summons were made by ALM.  It is sufficient for her to take instructions from the client.  I disallow DOL’s time for 1 hour and allow this item at HK$8,000.00.

6.  Item C3 The defendant claims for attendance on counsel by ALM for 2 hours 30 minutes and by DOL for 30 minutes.  The plaintiff’s solicitors suggest that such attendance should be reduced to 1½ hours for ALM.  In my view, give the flurry of affirmations filed quite close to the Hearing, it is necessary or proper for the defendant’s legal team to work closely to update on developments and to respond to the same.  However, I envisage some less complicated tasks can be delegated to DOL.  In the circumstances, I allow 2 hours for ALM at HK$8,000.00 and 30 minutes at HK$1,250.00 for DOL in the total amount of HK$9,250.00.

7.  Item D1  The defendant claims $36,000.00 (9 hours by ALM) and HK$26,250.00 (10 hours 30 minutes by DOL) for preparation of documents.  The plaintiff’s solicitors suggest allowing 4 hours’ work by ALM.  First, I bear in mind that any time spent on preparation of documents for the purpose of the defendant’s summons must be discounted.  Secondly, since the affirmations are made by ALM, the bulk of the work should be done by her.  DOL should at best help in collating the exhibits and other less complicated tasks.  I do not see the necessity or propriety of DOL incurring 10 hours 30 minutes, which I consider excessive.  Bearing in mind the above considerations, I allow in respect of the plaintiff’s summons 6 hours by ALM at HK$24,000.00 and 3 hours by DOL at HK$7,500.00 on party and party basis in the total amount of HK$31,500.00.

8.  Items D2 and D3  The plaintiff’s solicitors object to 2 hours  30 minutes spent by DOL on perusal of documents and 3 hours spent by him on preparation for the Hearing.  In light of my ruling on Item D4 below, I disallow the time spent by DOL on preparation for the Hearing.  I find it appropriate for DOL to spend time to peruse the documents to enable him to carry out the less complicated tasks under Item D1.  But the time claimed for is excessive and I reduce DOL’s time to 1 hour 30 minutes at HK$3,750.00.

9.  Item D4  The plaintiff’s solicitors object to DOL’s time for attending the Hearing.  I agree this should be disallowed since ALM was in attendance throughout the Hearing.  Since she is the partner in charge, her presence is sufficient to assist counsel and/or protect the interests of the defendant.  The hearing time is actually from 10:27 am to 1:13 pm and 3:35 pm to 5:08 pm.  But bearing in mind that the parties were in court since 10:00 am on Summons Day, the total time for the Hearing should be about 5 hours.  I therefore agree that the time allowed for ALM should be reduced to 3.33 hours at HK$13,320.00 in view of my order that only ⅔ of the time spent on the Hearing be apportioned for the defendant’s summons.  Indeed, the defendant’s solicitors should have made such reduction when they certified that the statement of costs did not exceed the defendant’s entitlement to costs in respect of the plaintiff’s summons.

10.  Item D5  The plaintiff’s solicitors suggest that I should disallow 30 minutes of ALM’s time for general care and conduct.  Given that I accept delegation of certain tasks by ALM to DOL is appropriate, this item should be allowed.

11.  Item E  First of all, counsel was instructed to attend the Hearing which involved both summonses.  Since the defendant is only entitled to recover costs of the plaintiff’s summons, counsel’s brief fee for dealing with the defendant’s summons must be discounted.  I consider it appropriate to discount any appropriate brief fee by notional counsel suitable for attending the Hearing by ⅓.  Secondly, on the quantum of counsel’s brief fee, the plaintiff’s solicitors suggest HK$30,000.00.  The defendant’s counsel was called to the Hong Kong bar in 1997.  He was previously involved in an earlier injunction application sought by the plaintiff in this action, and is therefore familiar with the background facts.  Given such history, it is not unreasonable for the defendant to retain counsel who is already familiar with the case.  Whilst I acknowledge that counsel’s brief fee is on the high side, I also bear in mind the limited time he has to work with (eg the relevant affirmations were filed within a small window of time from 21 to 24 January 2013) and the amount of papers and work involved.  In all the circumstances, I consider that appropriate counsel’s brief fee for the plaintiff’s summons (and excluding the defendant’s summons) is HK$100,000.00.

II.  PLAINTIFF’S COSTS

12.  Item A4  The plaintiff claims for an hourly rate of HK$4,000.00 for WKM.  The defendant’s solicitors suggest that such rate is excessive in view of the nature of the application and counsel’s involvement.  I disagree and consider the rate proposed by the plaintiff to be appropriate given the nature of the proceedings and the length of WKM’s post-qualification years.

13.  Items B1 and B2  The plaintiff claims 2 hours of work by WKM for attending the client and 1 hour for him for attending the other side.  The defendant’s solicitors suggest that since the factual background of the defendant’s summons is similar to the plaintiff’s summons, time allowed for WKM should be discounted.  Nevertheless, the application under the defendant’s summons raises an issue independent of the plaintiff’s summons, and the facts and considerations particular to such application have to be marshaled in response to such application.  In dealing with the matter of costs fairly for both parties, the court will look at the work done and consider what is necessary or proper for the purpose of the particular application being the subject matter of the costs order in question.  Next, the defendant’s solicitors suggest that because the plaintiff’s shareholders and directors are professionals and have close relationship to the plaintiff’s solicitors, the time required to take instructions should accordingly be reduced.  However, these matters do not lessen the duty of the plaintiff’s solicitors to take proper instructions in discharge of their duty as solicitors.  In the circumstances, dealing with the matter on a broad brush basis, I allow 1 hour of WKM’s time at HK$4,000.00 for Item B1 and 45 minutes of WKM’s time at HK$3,000.00 for Item B2.

14.  Item B3  The plaintiff claims for 1 hour of WKM’s time for attendance on counsel.  The defendant’s solicitors suggest that since the skeleton submissions of the plaintiff’s counsel do not touch upon the defendant’s summons, time allowed under this item should be reduced to 18 minutes.  How counsel presents the plaintiff’s case in his discretion does not necessarily mean little or no work has been done by the instructing solicitors.  I find it appropriate to allow 45 minutes of WKM’s time at HK$3,000.00 under this item.

15.  Item C1  Whilst the plaintiff’s summons, the 4th affirmation of Wong Mun Yee dated 22 January 2013 and WKM’s affirmation dated 24 January 2013 were settled by counsel, it is plain that WKM has to prepare initial drafts of such affirmations.  But the plaintiff is only entitled to costs in respect of the defendant’s summons.  I consider it appropriate to allow 30 minutes of WKM’s time at HK$2,000.00 for this item.

16.  Item C2  The plaintiff claims for 3 hours of work by WKM for perusal of documents.  The defendant’s solicitors say that the factual background of the defendant’s summons is part and parcel of the plaintiff’s summons. I refer to and repeat my discussion on such contention in paragraph 13 above. The defendant’s solicitors also suggest that perusal of submissions is mainly counsel’s work. Whilst counsel is involved, I accept that it is necessary or proper for instructing solicitors to consider the submissions (albeit not in as much depth as counsel) to properly advise their client and to assist counsel.  On a broad brush basis, I consider that 1 hour of WKM’s time at HK$4,000.00 should be allowed for this item.

17.  Item C3  The plaintiff claims 2 hours by WKM for preparation for the Hearing.  The defendant’s solicitors say it is excessive and should be reduced to 15 minutes.  In my view, the appropriate time for such item is 40 minutes of WKM’s time at HK$2,667.00.

18.  Item C4  The time for the Hearing apportioned for the defendant’s summons should be 5 hours x ⅓ (1.67 hours) at HK$6,680.00.

19.  Item D  I find counsel’s brief fee at HK$45,000.00 inclusive of settling the summons and affirmations appropriate and reasonable.  I therefore allow counsel’s fees at HK$45,000.00 x ⅓ = HK$15,000.00.

III.  CONCLUSION

20.  The total costs of the defendant on their statement of costs are assessed at HK$187,900.00 (being HK$1,500.00 (B1) + HK$580.00 (B2) + HK$8,000.00 (C1) + HK$2,000.00 (C2) + HK$9,250.00 (C3) + HK$31,500.00 (D1) + HK$11,750.00 (D2) + HK$8,000.00 (D3) + HK$13,320.00 (D4) + HK$2,000.00 (D5) + HK$100,000.00 (E)).

21.  The total costs of the plaintiff on their statement of costs are assessed at HK$40,347.00 (being HK$4,000.00 (B1) + HK$3,000.00 (B2) + HK$3,000.00 (B3) + HK$2,000.00 (C1) + HK$4,000.00 (C2) + HK$2,667.00 (C3) + HK$6,680.00 (C4) + HK$15,000.00 (D)).

22.  After set-off in respect of the aforesaid costs, the plaintiff shall forthwith pay net costs in the sum of HK$147,553.00 to the defendant.

23.  After I made the costs orders at the Hearing, the defendant’s solicitors wrote to the court on ex parte basis (albeit on notice) on 1 February 2013.  They refer to 3 witness statements served by the plaintiff after the Hearing with a view to raise questions on the bona fides of the plaintiff’s actions which they say “is obviously relevant to the exercise of discretion on costs by the Court in respect of the injunction hearing on 25 January 2013”.

24.  In my view, this is misconceived.  The court has already made the relevant costs orders at the Hearing, and the only remaining task is to assess the quantum of the costs already awarded pursuant to the costs orders.  Assessment of costs on party and party basis is done on the basis set out in paragraph 2 above.  There is no room for revisiting the discretion that has already been exercised by the court in making the costs orders at the Hearing on 25 January 2013 whether on the bona fides of the plaintiff on matters after the making of the costs orders or otherwise, and certainly not on the basis of ex parte correspondence to the court by the parties.

25.  Regrettably, the letter by the defendant’s solicitors dated 1 February 2013 has excited a letter to the court by the plaintiff’s solicitors dated 4 February 2013 that attempts to give an explanation for the 3 witness statements and a further letter by the defendant’s solicitors dated 4 February 2013 to the court enclosing a thick bundle of the 3 witness statements, and even inviting the court to read them.  As explained above, these are quite irrelevant to the exercise of summary assessment of costs pursuant to the costs orders made at the Hearing on 25 January 2013.  I therefore order that there be no order as to costs of and occasioned by these 3 letters.

(Marlene Ng)
Deputy High Court Judge

 

Messrs Christine FL Ip & Young for the plaintiff.

Messrs Wilkinson & Grist for the defendant.

85987-EN-2013-01-25

CHIN LING INVESTMENT LTD v. THE GENERAL OF THE SALVATION ARMY

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HCA 1/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1 OF 2012

____________________

BETWEEN

 CHIN LING INVESTMENT LIMITEDPlaintiff

and

 THE GENERAL OF THE SALVATION ARMYDefendant
____________________
Before: Deputy High Court Judge Marlene Ng in Chambers
Date of Hearing: 25 January 2013
Date of Decision: 25 January 2013

_______________

D E C I S I O N

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1.  This case is a neighbourhood dispute. The neighbouring pieces of land were originally from Lot 181 of DD390 in Sham Tseng which is an enclosed area away from the Castle Peak Road. So in the Additional Special Condition No. 7 of the Conditions of Grant, a non-exclusive right of way was granted over a slip road on Government land for access purposes. It is marked blue on the plan attached to the Conditions of Grant (“Blue Area”).

2.  Pursuant to a Deed of Partition dated 30 October 1958, Lot 181 was divided into Lot 181 SA and Lot 181 RP.  As a result of the partition, Lot 181 SA, which is further away from the slip road, has become land‑locked.  Lot 181 RP abuts the slip road, so in order to access the slip road for ingress and egress, persons on Lot 181 SA have to pass over Lot 181 RP, so in Clause 2 of the Deed of Partition there is a provision for a right by the owner of Lot 181 SA and related persons to pass or repass over the portion of Lot 181 RP coloured green on the plan annexed to the Deed of Partition (“Green Area”).

3.  The plaintiff became the owner of Lot 181 SA in 1992, and in 2005 the Government granted the plaintiff an additional parcel of land to the west of Lot 181 SA as an extension thereto (“Extension”).

4.  The plaintiff claims that for a long time they and their predecessors in title had a right of way over the Green Area to reach the slip road and then onto Castle Peak Road.  But in 2005 they discovered that such access was blocked by a metal gate (“first metal gate”).  For reasons which I need not detail for today’s purpose, the first metal gate was removed by the defendant.

5.  Subsequently, the plaintiff discovered (and the defendant admits) another metal gate was installed on the Government land immediately outside Lot 181 RP and a small parcel of Government land was enclosed  (“ the second metal gate”).  The defendant admits it was installed in 2011, and claims that the second metal gate is required to keep out trespassers and stray dogs and to prevent illegal parking.

6.  There is dispute whether a metal gate had previously been installed at about the place where the first and/or second metal gate was/is located.  The plaintiff claims there was none until very recently, but the defendant says there has always been a metal gate.  Again this dispute is not really material to our consideration today because this is not an occasion to resolve issues of fact. 

7.  The plaintiff claims that the second metal gate, whether locked or not, wrongfully interferes with their entitlement of free and uninterrupted right to pass over the Green Area, and demands its removal.

8.  It is the defendant’s stance that currently the access road used by the plaintiff, the defendant and the owner of Lot 201 in DD390 to reach Castle Peak Road came into existence in 1992 when the Blue Area was rebuilt and realigned by the owner of Lot 201 pursuant to a modification of his lot, and the new access road was different from the Blue Area. But it is still necessary for persons from Lot 181 SA to pass through the Green Area to get to the new access road.  Before the new access road, the defendant had used the Blue Area, i.e. the slip road, for ingress and egress.  They say that since the 1970s there was already a metal gate to the location of the second metal gate, and the plaintiff should have known about the metal gates since the 1990s.  They further say that they are entitled to erect the second metal gate and to keep it closed but not padlocked in order to keep out human or canine intruders.  All that needs to be done is to lift the hinge of the second metal gate to open it.  Even if there were a right of way over the Green Area, the plaintiff is not entitled to excessive use of the right of way for developing Lot 181 SA and the Extension which exceeds the original grant for such right of way.

9.  In respect of the Extension, the plaintiff’s pleadings claim that it is used as a private garden so there is no burden on the servient tenement. Alternatively, use of the Extension for the purpose of Lot 181 SA is reasonably necessary, and falls within the scope of the right of way.

10.  On 3 January 2012, the plaintiff applied for interlocutory prohibitory and mandatory injunction orders, including the dismantling of the second metal gate.  In paragraph 21 of the plaintiff’s affirmation in reply filed on 19 March 2012, it was clear that the plaintiff was aware of the encroachment of the Government land by the defendant because the plaintiff’s solicitors sent two letters to the District Land Office on 21 January 2012 and 13 March 2012 drawing their attention to such fact and asking the Government (if seen fit) to pursue statutory enforcement action without delay.  The affirmation goes on to say:

“Although the plaintiff has not heard any reply as of today, I verily belief that because of the encroachment on the Government land, sooner or later the 2nd Metal Gate is bound to be demolished. Any alleged prejudice likely to be caused to the Defendant by the demolition therefore is unreal, or otherwise self-made, since the Defendant is not entitled to erect the 2nd Metal Gate on the Government land in the first place.”

11.  At the hearing on 28 March 2012, Deputy High Court Judge Burrell adjourned the summons for injunction upon the undertaking by the defendant through counsel to keep the second metal gate open at all times until further order.  An order was granted for expedited trial and for affirmations to stand as witness statements and evidence-in-chief.

12.  Two things are of note.  First, it is plain that the court considered that the defendant’s undertaking to the court together with the order for early trial was a more appropriate way to deal with the case rather than going into the merits of the injunction application.  Mr Yin, counsel for the defendant, reminded there was no appeal from this order.

13.  Secondly, at the time when the undertaking was given by the plaintiff and the order was made by Deputy High Court Judge Burrell, the plaintiff was already aware of the encroachment of the second metal gate onto the Government land and they already took a view that because of this the second metal gate was bound to be removed sooner or later. Hence, they were alive to the consequences of the encroachment of an unauthorised structure on the Government land when the undertaking was given and accepted by the court.

14.  After this, the plaintiff took active steps to push ahead with the case, going so far as to try to set the case down for trial.  When it was confirmed that no leave had been granted for such purpose, orders were sought for usual case management.  Thereafter, list of documents were filed.  There was mutual agreement to extend time for compliance with court-imposed case management timetable.  Parties exchanged expert reports, and the defendant served witness statements.  The plaintiff did not serve witness statements and presumably only relied on the earlier affirmations.

15.  At the case management conference on 11 October 2012, the action was stayed for mediation until 21 November 2012. Mediation failed.

16.  On 15 October 2012, the defendant applied to lift the stay.  On 9 November 2012, the parties by consent lifted the stay, allowed the defendant to file several short supplemental witness statements, and gave permission to the plaintiff to file supplemental witness statements.

17.  At the case management conference on 22 November 2012, the Master considered the case to be essentially ready, and asked the parties to make a consent application in respect of the supplemental expert report by the plaintiff’s expert and to confirm that the case would be ready for trial within 28 days.

18.  In my view, the progress of the case up to this point cannot really be criticised, notwithstanding an order for expedited trial.  There was cooperation between the parties and time was taken up with the witness statements, expert reports, discovery and mediation.  There were no unjustified steps.  However, it would have been more desirable had those steps been expedited in the spirit of the order for early trial. 

19.  But thereafter the plaintiff sought three time extensions for serving supplemental witness statements by time summonses dated 3 and 17 December 2012 and 8 January 2013.  I pause to note that the plaintiff already had access to the defendant’s signed supplemental witness statements since 15 October 2012, and I agree that those supplemental witness statements are factually uncomplicated.  It was suggested that time was needed to study the video clip recently disclosed by the defendant, but it was merely about dogs roaming Lot 181 RP when the second metal gate was open.  Eventually, on the third application, an unless order was granted on 16 January 2013.  The plaintiff had to file and serve supplemental witness statements by 30 January 2013, and jointly with the defendant write to the court on expert evidence with confirmation for setting down for trial by 6 February 2013.

20.  But it transpired that on 9 August 2012 the plaintiff received a letter from the District Land Office (“DLO” – see paragraph 38 below).  By 3 October 2012 it was discovered that the main metal gate at the other end of the access road abutting the Castle Peak Road had been removed.  On 27 December 2012, the plaintiff’s solicitors wrote to the defendant’s solicitors demanding removal of the second metal gate.  On 9 January 2013, the defendant’s solicitors confirmed that the defendant received a similar letter from the DLO, but suggested that enforcement action could be against the defendant and not the plaintiff because the defendant never denied it was responsible for erecting and maintaining the second metal gate.

21.  On 15 January 2013, the plaintiff issued a summons for prohibitory and mandatory injunctions returnable before me today.  This was just before the plaintiff’s third time summons in which time extension was sought until 14 days after the plaintiff’s application for removal of the second metal gate erected by the defendant, which was subject to the letter from the DLO.  Nevertheless, the learned Master granted the aforesaid unless order.

22.  The defendant says that all these are tactical moves to delay the setting down for trial in the hope that the DLO would remove the second metal gate before court adjudication in this case. They say that because the delay poses security problems for them, so on 21 January 2013 they applied for release from the undertaking given to and accepted by the court in March 2012.

23.  As a backup to the plaintiff’s summons for interlocutory injunction, the plaintiff also issued a summons returnable before a Master on 1 February 2013 to amend the statement of claim with proposals for directions to file sequential amended pleadings and to defer the plaintiff’s supplemental witness statements until after close of those amended proceedings.

24.  Let me deal with some of the procedural matters raised.

25.  First, counsel for the defendant, Mr Yin, says that it is an abuse of process not to restore the adjourned interlocutory injunction summons that was before Deputy High Court Judge Burrell.  Whether that be correct or not, I do not wish to deal with the matter of form.  After all, the injunction sought by the summons dated 15 January 2013 are not exactly on all fours with the earlier injunction summons, so if that is going to be pursued, a fresh summons is required in any event.

26.  Secondly, I agree that the plaintiff cannot reopen a claim for interlocutory injunction merely because he feels, or the circumstances appear to indicate, that he wrongly estimated that an undertaking given and accepted would give him adequate protection.  Mr Wong, counsel for the plaintiff, also accepts this proposition.  That being the case, the plaintiff cannot really be heard to seek an injunction on the basis of matters already canvassed in the earlier application for which the defendant had given an undertaking that had been accepted by the court.

27.  Thirdly, I agree (and so does Mr Wong) that the plaintiff has to show there has been a material change in circumstances so as to justify the present application for interlocutory injunction despite the undertaking that was given by the defendant.

28.  I would like to say a few words about the main metal gate first before I deal with the material change in circumstances, if any.  The main metal gate is a metal gate at the position where the access road abuts Castle Peak Road.  Mr Wong informs the court in the course of the proceedings today that the plaintiff does not now wish to pursue the injunction in respect of the main metal gate because it had been removed. But the injunction application encompasses not just the main metal gate but also the ancillary wire mesh fencing and the concrete columns of the main metal gate.  The defendant’s affirmations confirm that the concrete column still stands, but Mr Wong says today that no injunction will be sought in respect of the concrete columns or any wire mesh fencing ancillary to the main metal gate.

29.  This, in my view, must be correct, because these structures are not on Lot 181 RP, and there is no evidence that they were erected by the defendant alone.  According to paragraphs 47 to 49 of Wong Man-yee’s first affirmation dated 3 January 2012, the main metal gate was constructed and contributed to by the agreement of the six owners of Golden Villa together with the plaintiff and defendant, and the costs for the installation of the main metal gate were shared by them.  Each of them also had a remote control device.  Indeed, it was suggested in such affirmation made for the purpose of the first injunction application that the removal of the second metal gate would not be a problem because the existence of the main metal gate would protect the defendant’s land.

30.  According to the defendant, the main metal gate was removed by the owner of the Golden Villa, leaving the two concrete columns still standing.  Although the plaintiff casts suspicion on such assertion, they confess they have no prior knowledge as to the demolition of the main metal gate, and they only discovered the removal by 3 October 2012.  However, they believe it was the defendant who stealthily dismantled the main metal gate as the defendant was one of the contributors to the setting-up costs of the main metal gate.  No concrete reason was given for such surmise, nor was an explanation given as to why it could not have been demolished by the six owners of the Golden Villa who had also contributed to the setting-up costs of the main metal gate.  Indeed, the plaintiff themselves were one of the contributors.

31.  Mr Wong suggests that because the plaintiff’s solicitors have written to the defendant’s solicitors demanding removal of the main metal gate and the ancillary features, and there was no positive or constructive response from the defendant either to invite a joint effort of all the relevant owners for the removal of the main metal gate or to authorise the plaintiff to do so or to deny responsibility for the main metal gate, the plaintiff is therefore entitled to seek an interlocutory mandatory injunction to require the defendant alone to remove the main metal gate and the ancillary structures.

32.  Such proposition needs only to be stated for it to be rejected.  There is no arguable basis for such proposition, let alone any strong prima facie case for attaching sole responsibility on the defendant for removing the structures at the main metal gate.  Indeed, there is no evidence before me at all for suggesting that it was the defendant who removed the main metal gate.

33.  The plaintiff has not persuaded me there is a serious question to be tried, let alone a strong prima facie case as to the defendant’s alleged duty or liability to remove the concrete columns of the main metal gate on their own.  So in any event, I would not have been prepared to grant any interlocutory injunction for the removal of the concrete columns or installations in relation to the main metal gate vis-à-vis the defendant.

34.  The presently pleaded issues in this case are whether the defendant is entitled to erect or maintain a gate at the boundary of Lot 181 RP and the Blue Area, being Government land, and whether the plaintiff is entitled to use the right of way over the Green Area to access the Extension which the plaintiff obtained after the grant of such right of way.

35.  The defendant says there are no merits to the plaintiff’s case on these real issues, but given the order for expedited trial, there is no need for me to consider these matters.  I accept there is a serious question to be tried on these issues, but since these matters are not new developments but are subject matters canvassed at the earlier injunction application resolved by way of an undertaking given by the defendant and accepted by the court, I am not persuaded that these matters ought to be revisited in any detail today.

36.  I now turn to the alleged material change in circumstances.  The only matter that has been referred to is the DLO’s letters of 9 August 2012 to both the plaintiff and the defendant.  The plaintiff seeks to further suggest that the present application is different from the earlier injunction application in that they now additionally seek removal of both the second metal gate as well as the ancillary mesh wire fencing and concrete columns.  But given my views on the main metal gate, the only additional matter is the fencing of the second metal gate, which essentially is part and parcel of the structures which are already evident at the last application for injunction.  After all, the gate cannot stand without supporting structures, and the fencing was seen in the photographs exhibited for the last application.  So but for the DLO’s letters and the complaints therein, there is nothing essentially new.

37.  Under clauses 3 and 4 of the Deed of Partition, the owners of Lot 181 RP and Lot 181 SA covenanted with each other to perform the terms and conditions by and in the grant and agree to indemnify each other against all actions and suits in respect of the non-performance of the said terms and conditions or any of them. 

38.  The DLO letters of 9 August 2012 claim that the second metal gate, the main metal gate and the ancillary mesh wire fencing and concrete columns are unauthorised structures within the Government land and constitute a breach of the Additional Special Condition No. 7 of the Conditions of Grant which I have referred to above, and request the plaintiff and the defendant to purge the breach by demolishing the structures. The DLO also reserves the right to take out lease enforcement action including re-entry and other enforcement action. 

39.  So I will have to consider the DLO’s letter of 9 August 2012 in light of the provisions in the Conditions of Grant, the Deed of Partition as well as the discussion on law that has been canvassed by counsel.

40.  There is no dispute that the second metal gate is slightly outside the lot boundary of Lot 181 RP and straddles Government land.  To avoid this new issue being raised or pleaded to derail the real issues in dispute, the defendant is prepared to move the second metal gate and any ancillary feature to relocate them within the lot boundary of Lot 181 RP, which exercise will take three working days and cost about $8,000 to $10,000.

41.  The plaintiff is not prepared to accept this, and says that this is an abuse of process or even a contempt of court. Insofar as the defendant intends to relocate the second metal gate, fencing and other structures back within their own land, Lot 181 RP, and to keep the gate open at all times, I cannot see how it is an affront to the undertaking to the court.  Indeed, it remains within the spirit of the undertaking of allowing access via an open gate until trial.  After all, the relocation of the gate will be done over the defendant’s own land and not on either the plaintiff’s land or Government land.

42.  But now the plaintiff wants the removal of the second metal gate altogether, without permitting the defendant to erect any gate structure within their own land at the point where it abuts the Blue Area.  They require demolition altogether, which is the effect of the mandatory and prohibitory injunctions now being sought.

43.  Given the defendant’s offer to relocate the second metal gate and to remove all ancillary structures from encroaching on Government land, I am satisfied that really addresses all the concerns of the plaintiff insofar as they require preservation of the use of the right of way over the Green Area within the spirit of the undertaking.  To go further to ask for the demolition of the second metal gate simpliciter without any relocation at all goes much further than what is provided for in the undertaking accepted by the court, and that must be justified on the basis that there is a serious question to be tried on any material change in circumstances.

44.  Is there any material change in circumstances and is there any serious question to be tried?  Mr Wong says yes, but Mr Yin says that the injunction application is a non-starter in the first place.

45.  The plaintiff claims that after 28 day deadline in the DLO’s letter, the second metal gate poses a real risk that the Government, through the DLO, will take enforcement action by re‑entering and forfeiting not just the defendant’s land but the plaintiff’s land, ie Lot 181 SA and the Extension, any time soon, which amounts to an encumbrance on title.  Even though the defendant accepts it is responsible for the second metal gate and will be the prime target of any enforcement action, the plaintiff says the DLO has also issued a demand letter to the plaintiff, and the risk of enforcement can only be removed by the removal of the second metal gate.  Mr Wong says the risk of enforcement is there because the defendant has not produced their reply to the DLO, and it is not known whether they have openly indicated to the DLO that they are responsible for the second metal gate.

46.  The defendant says that since it has never been denied they were responsible for erecting and maintaining the second metal gate, the enforcement action at best would only be against the defendant and not the plaintiff.  Even if there is a risk of enforcement for Lot 181 SA, this risk has all along been there and has been considered at the time of the first injunction application and when the undertaking was given.  Indeed, it was the plaintiff who reported the matter to the DLO and invited enforcement action without delay.  In the circumstances, if the plaintiff wrongly estimated the adequacy of the protection offered by the undertaking, it is not a ground for reopening the injunction.

47.  The defendant further says that even if the second metal gate gives rise to a right on the part of the Government to forfeit the lease on Lot 181 SA, the plaintiff still cannot sue the defendant. Even if the plaintiff has an arguable cause of action that the Government may forfeit the lease of the land, on any view of the matter, the Government will not be able to do so.  The defendant says this is because Clause 7 of the Additional Special Conditions of the Conditions of Grant merely specifies that the Blue Area would not give the grantee a non-exclusive right to use the slip road, and the Government reserves the right to grant the right of way to lessees of other lots.  The plaintiff says that the presence of the second metal gate, as distinct from the main metal gate, does not derogate from the non-exclusivity of the right of way over the Blue Area because it was at the margin of the Blue Area.  They also say that since the plaintiff is not responsible for the second metal gate, they will have a cast-iron case for relief against forfeiture.

48.  In relation to the DLO’s letter complaining about the second metal gate and the encroachment on Government land as a result thereof, Mr Wong does not premise his case on nuisance and trespass.  Rather, he says there is a risk of enforcement because of a potential blot on title. 

49.  It is common ground between counsel that the principles in Lester v Ridd [1990] 2 QB 413 are applicable.  In that case, Lord Justice Dillon held at page 438 that the effect in law of the partition of demised premises by assignment of part to A and remainder to B of the residue of the unexpired term of the lease, then notwithstanding that the landlord did not concur in the partition to sever the covenants of the lease to follow the land, an action on the covenants would be in favour of the landlord against each assignee of part for not repairing his part of the land or for not paying a fairly attributable part of the rent for his part of the land.  In short, the landlord cannot pursue a claim on default against all of the owners of the partitioned lands.  

50.  Here, the Government is the landlord, and the plaintiff and the defendant are the lessees of part of the demised land after the partition.  Additional Special Condition No. 7 of the Conditions of Grant, ie the lease, that provides for a right of way over the Blue Area is non-exclusive, but that right of way abuts Lot 181 RP, and there is no dispute between the parties that the second metal gate is put up by the defendant.  So even assuming that the second metal gate located on the Government land is a breach of the Additional Special Conditions, on the above legal principles, which Mr Wong accepts, the landlord, being the Government, will have a right of action against the lessee of the part in breach, ie the defendant, and not the plaintiff, who has nothing to do with the second metal gate.

51.  Mr Wong’s answer to this is that because the plaintiff does not know what the defendant told the DLO, the DLO might still decide to take enforcement action against the plaintiff’s land as well as the defendant’s land which they have referred to in their letters of 9 August 2012.  But as Mr Yin points out, that is tantamount to saying that there will be a blot on title because of potential wrongful enforcement action that may be taken by the landlord against an innocent owner of part of the demised land after partition.  That cannot be right, even though it may be tiresome to deal with wrongful action by the landlord.

52.  In the circumstances, I am not persuaded that the plaintiff has satisfied the threshold test for either a mandatory injunction to remove the second metal gate and all ancillary features altogether or a prohibitory injunction not to reinstate any such gate at this interlocutory stage.  I also make clear that this is independent of the offer by the defendant to relocate the second metal gate and ancillary structures back to their own land.

53.  Given Mr Wong’s acceptance of the legal principles, on any view in respect of the application of such principles to the circumstances of the present case, I am not satisfied that the threshold test for granting interlocutory injunction has been satisfied.  That being the case, there is no need for me to go further to analyse the other grounds put forward by Mr Yin, ie whether assuming that the Government is entitled to take enforcement action against the plaintiff’s land it could be resisted on the basis that encroachment was de minimis or there being a case for relief against forfeiture by the plaintiff.

54.  Nevertheless, given that the defendant is willing to remove the second metal gate and the ancillary features from the Government land and relocate them back to their own land, the court accepts such proposal to forestall any future contention so that this case can proceed to early trial as originally intended.  But in case if I am wrong on the issue of whether the threshold test has been satisfied, I will go further to consider the balance of convenience.

55.  The defendant says that this is a mere technical ploy to delay or prevent the trial to put pressure on the defendant. The application was made more than five months after the receipt of the DLO’s letter in August 2012, without any explanation for the delay.  The time extension sought for the supplemental witness statements in reply to simple statements served by the plaintiff resulting in an unless order speak of undue delay.  The defendant says that an order for setting down should be made as soon as possible.

56.  As regards the complaint about the hinged lever of the second metal gate causing injury and difficulty to children, these matters have been canvassed in the earlier injunction application, and consideration of such matter must have been taken into account in the undertaking given and accepted.  I am not persuaded I should delve into the history of whether there had or had not been any metal gate in the past.  There is dispute between the parties on this issue, and as I have said, an injunction application is not the time or place to resolve dispute of facts.

57.  In respect of the demolition of the first metal gate, this is again a matter canvassed in the earlier injunction application.  I see no justification for the plaintiff to say that because the defendant has given an undertaking to keep the gate open until trial and has abided by that undertaking to date, that is a reason now, prior to trial, to forego the undertaking and restore the mandatory injunction originally sought so that the defendant has to demolish the gate structure, but only to reinstate it if they succeed at the end of the day.

58.  The status quo pending trial prior to this application by the plaintiff (pursuant to the undertaking accepted by the court) is that the defendant has a second metal gate in place, but it is kept open at all times.  The status quo during pendency until trial is not the absence of any metal gate at all, as suggested by Mr Wong by reference to matters prior to the undertaking.

59.  The plaintiff says that it plans to develop and sell Lot 181 SA and the Extension, but upon disclosure of the letter from the DLO to potential purchasers, the negotiations fell through since prudent purchasers would not buy the land before the removal of the encumbrance specified by the DLO.  The existence of the second metal gate being an encumbrance and the DLO’s demand for removal may well bring the market value of the land down, and the grant of a mandatory injunction to do what the DLO required would not cause prejudice, so there is said to be urgency in the removal of the second metal gate in order to sell or develop the site, especially when planning approval for utilising the full development potential of the land and application for building works to commence would not be entertained without the removal of the second metal gate as required by the DLO.

60.  However, there has been no persuasive explanation from the plaintiff as to why no fresh injunction application was made upon receipt of the DLO letter, but only months afterwards when the case is close to being ready to set down for trial.  This is especially of concern when they are alive to the issue of encroachment on the Government land and the risk of enforcement action as early as when the first injunction was being sought.  Anyway, this point is dependent on the viability of the plaintiff’s cause of action based on encroachment of the Government land.  In light of the above views, there is no merit to this argument. 

61.  In any event, until adjudication in this case, the plaintiff has unresolved problems that affect the potential sale or redevelopment, namely whether there is a right of way over the Green Area for serving the Extension which itself is landlocked, and whether the defendant is entitled to put up a gate at the adjoining edge of Lot 181 RP and the Blue Area.  Either party may succeed at the end of the day, and it is not for me to speculate now who will do so.  I cannot see how the balance of convenience is served by having the second metal gate removed altogether now, when there is already an undertaking to keep it open at all times pending trial for ingress and egress.

62.  In this case, the defendant has offered to move the gate structure to relocate it back to within their own land, which can be done within three days at minimal cost to be borne by the defendant.  So long as the gate structure, whether the metal gate, wire mesh fencing, or any other structure, is relocated back to the defendant’s own land and such gate is kept open at all times until trial, it maintains the status quo as per the undertaking, and answers the plaintiff’s complaint concerning the encroachment and risk of enforcement.  It also permits the plaintiff open ingress and egress to their own land.

63.  There is no need for, and indeed it is inappropriate to consider, an interlocutory mandatory injunction when a less intrusive measure can be achieved quickly and economically that meets the undertaking that has been in place as well as the balance of convenience of the parties. This approach also has the added advantage that the parties can progress to trial quickly in the spirit of the order for expedited trial without further skirmishes on issues of encroachment and enforcement.

64.  The defendant has applied for release from the undertaking.  The defendant says that with the removal of the main metal gate, the enforced opening of the second metal gate as a result of the undertaking causes hardship, as there is no way the defendant can keep out human or vehicular intruders.

65.  I am not persuaded that the defendant should be released from the undertaking to keep the second metal gate open at all times now that the second metal gate will be relocated within the defendant’s land.  As I have pointed out, until November 2011, there is no clear sign of deliberate delay on the part of the plaintiff.  Although time has been spent by the parties to prepare expert and lay evidence and further, although better progress would have been desirable, now that the second metal gate will be relocated, and given that the unless order by the learned Master sets a guillotine deadline for the plaintiff to serve supplemental witness statements, I am persuaded that tight case management measures can progress this case to trial quickly without undue risk to the defendant.

66.  Further, I am not persuaded that loss of the main metal gate materially affects the balancing of the considerations. The defendant does not seek to bolt the second metal gate even if it is closed, and says that it can be easily opened.  If that is the case, it is unlikely to keep out any determined intruder or trespasser. 

67.  That being the case, on the basis that the defendant will move the second metal gate structure, whether the gate, any wire mesh fencing or any further structure back to within Lot 181 RP, but will keep such relocated gate open at all times until trial, the plaintiff’s application for injunctions is dismissed, and the defendant’s application for release from undertaking is also dismissed.

68.  I will now hear counsel to work out the wording of the formal order, including the period for the relocation of the gate structure, and to address on the costs and ancillary matters including whether, if possible, the amendment summons can now be disposed of, and what outstanding matters can be dealt with today before the matter can be set down for trial.

(Submissions on the above matters)

69.  Although both parties hold a different stance on the question of costs, the plaintiff asking for costs in the cause, and the defendant asking for costs, I see no reason to depart from the usual principle that costs follow event.  The plaintiff shall pay the defendant’s costs of and occasioned by the plaintiff’s summons dated 15 January 2013, and the defendant shall pay the plaintiff’s costs of and occasioned by the defendant’s summons dated 21 January 2013.  For the avoidance of doubt, I apportion one-third of the overall costs of the hearing to be for the defendant’s summons dated 21 January 2013.

 (Marlene Ng)
 Deputy High Court Judge

Mr Tim Wong, instructed by Christine F L Ip & Young, for the plaintiff

Mr Michael Yin, instructed by Wilkinson & Grist, for the defendant