WONG CHOW YUN v. QWOK LEUNG MAH

DCMP 1752/2015

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 1752 OF 2015

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JUDGMENT

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1.  The plaintiff claims against his co-owner the possessory title in the 5/6 shares of the property known as 3^rd Floor, No. 160 Reclamation Street, Kowloon, Hong Kong (“the Property”) under sections 7 and 17 of the Limitation Ordinance.

2.  The defendant did not appear in the proceedings.

Service of the proceedings on the defendant

3.  The plaintiff took out the originating summons on 7 July 2015. 

4.  On the plaintiff’s application, the court ordered on 17 December 2015 that service of the proceedings can be effected by way of advertisement of a Chinese notice of these proceedings in a local Chinese newspaper publishing and circulating in Hong Kong.

5.  The plaintiff has accordingly published an advertisement of a Chinese notice of the proceedings on Ming Pao on 27 January 2016. The plaintiff’s solicitors confirmed that no news was received from the defendant.

6.  The hearing of the originating summons was adjourned to 24 June 2016. By way of substituted service, the plaintiff has published on 18 May 2016 on Ming Pao a Chinese notice of the date of the adjourned hearing.

7.  At the hearing on 24 June 2016, it was noted that the defendant’s address stated on the assignment of the Property dated 3 January 1963 is an address in Canada. There was no evidence that effort has been made to trace the defendant with reference to this Canadian address.  Deputy District Judge Winnie Tsui adjourned the hearing for the plaintiff to trace the whereabouts of the defendant with reference to the Canadian address and make such other enquiries as may be appropriate. The plaintiff was ordered to file an affirmation deposing the steps so taken.

8.  The plaintiff filed an affirmation deposing that they have made further enquiries of the whereabouts of the defendant at the Canadian address but of no avail.  The plaintiff also deposed to in the affirmation that he believed the defendant has abandoned the Canadian address. Having satisfied that the plaintiff had made the enquires as ordered, Deputy District Judge Winnie Tsui adjourned the hearing to 20 January 2017 and ordered that the plaintiff shall published on Ming Pao an advertisement of a notice of these proceedings including the trial date and venue.  The advertisement was published on 19 October 2016.

9.  The plaintiff has confirmed by affirmation that record search with the Probate Registry and death search with the Birth and Deaths Registry were conducted in June and July 2015 respectively.  No record of the defendant was found from these searches.

10.  The plaintiff believed that the defendant is still residing in Hong Kong.

11.  No acknowledgement of service and no notice of intention to defend have been received from the defendant.  The defendant did not appear at this hearing.  This court hear the present application under Order 28 rule 6 of the Rules of District Court.

The plaintiff’s evidence

12.  The plaintiff filed several affirmations in support of his application and gave evidence in court. He was legally represented at all stages of the proceedings.

13.  In cases where the ownership of a property is an issue, it is elementary that a land search record of the property is the evidence to support the contention on ownership and, insofar as it is relevant, to show to the court whether or not there is any encumbrance attached to the property. The plaintiff has made four affirmations in this application, but he has not produced the land search record as an evidence.  It was only upon enquiry from this court at the beginning of the hearing that counsel for the plaintiff sought to produce the same.

14.  It is the plaintiff’s case that the Property was jointly purchased by the plaintiff’s father and the defendant as tenants in common in January 1963. The defendant is a clan member of the family of the plaintiff’s father. According to the plaintiff, he should be aged below 80 by now.

15.  At that time, the plaintiff’s father owned one-sixth share of the Property and the defendant owned the remaining five-sixth shares. 

16.  The Property is a residential premises, which contains 7 bed rooms, one toilet, one living room and one dining room.  The plaintiff, the defendant and their respective families had resided at the Property in 1963 to 1970s.

17.  In about 1980s, the plaintiff’s father died intestate in Hong Kong.  By an assignment dated 23 September 1987, the plaintiff’s mother (who was the administratrix and beneficiary of the estate of the plaintiff’s late father) had assigned the 1/6 share of the Property to the plaintiff by way of gift. Since then, the plaintiff became the legal and beneficial owner of the 1/6 share of the Property.

18.  The plaintiff testified that his late father told him that the defendant had left and completely abandoned the Property in early 1970s.  The defendant did not leave any contact details of himself, and did not inform the plaintiff and his father of his whereabouts.  The defendant was single and at his mid-twenties when he left the Property.

19.  After the defendant left the Property, the plaintiff and his father made repeated enquiries from relatives and friends as to the defendant’s whereabouts but no positive news about the defendant was heard. 

20.  During the first few years after the defendant had left the Property, the plaintiff’s father and family kept using the Property with the hope that the defendant might turn up some day.

21.  As time passed, the plaintiff’s father occupied the Property as his own. In late 1970s, the plaintiff’s father and family moved out from the Property and leased it to different tenants.  The entire rental income was collected and used by the plaintiff’s father without any account to the defendant.

22.  After the death of the plaintiff’s father, the plaintiff’s mother stepped into the shoes of the father and took charge of the collection of the rents from the Property.  The plaintiff’s mother used the entire rents so collected as if they were her own, and she made no account to the defendant. The plaintiff’s mother passed away in 2011.

23.  The plaintiff said that since he became the owner of the 1/6 share of the Property in 1987 and until 2003, the Property was leased to different tenants.  The plaintiff received and used the whole of the rental income from these tenants.  At the same time, he was responsible for the maintenance of the Property.

24.  In about 1996, the plaintiff registered his own name with the Rating and Valuation Department as the ratepayer in respect of the Property in place of the joint names of the plaintiff’s father and the defendant.

25.  In about 2003 to 2006, the plaintiff permitted his elder sister and family to live in the Property by granting them a licence on a complimentary basis.

26.  In 2006, the plaintiff resumed the physical possession of the Property, moved in the Property and lived there together with his family.

27.  The plaintiff said that he had treated the Property as part of his private property since 1987.  He and his family have been keeping the exclusive control, management and maintenance of the entire Property at his own costs. The Property has been locked at all time in the manner he thought fit.  The plaintiff was responsible for payment of all utilities, outgoings and expenses in relation to the Property.

28.  The plaintiff believes that the defendant was still alive and should be at somewhere in Hong Kong.   Even if the defendant turns up now and requests for the use or possession of the Property, he would refuse such requests.  He said that he considered the defendant had ceased to be the owner of the 5/6 share of the Property in 1987 when he acquired the 1/6 share of the Property. He said that he has been occupying the entire Property to the exclusion of the defendant and the world at large since 1987.

Adverse possession

29.  Section 7(2) of the Limitation Ordinance provides that no action shall be brought by any person to recover non-government land after the expiration of 12 years from the date on which the right of action accrued to him.  The limitation period of 12 years is a result of the amendment to the Limitation Ordinance in 1991. 

30.  Section 38A of the Limitation Ordinance provides for the transition relating to the 1991 amendments. Pursuant to section 38A, in cases where the time for bringing proceedings in respect of a cause of action to recover any land accrued before 1 July 1991, the pre-amendment limitation period applies.

31.  The plaintiff claims that he has been in possession of the Property to the exclusion of the whole world including the defendant since 1987.  In accordance with section 38A, the applicable limitation period should be 20 years. The plaintiff has to prove that he had adversely possessed the 5/6 shares of the Property belonging to the defendant for more than 20 years prior to the commencement of the present proceedings in July 2015, but not 12 years as counsel for the plaintiff submitted.

32.  Time starts to run when the landowner has been dispossessed of the land and the adverse possessor has taken possession of the land (section 8(1) of the Limitation Ordinance).

33.  The effect of a successful claim on adverse possession is that the paper owner’s title to land and his right to cover the land from the adverse possessor are completely extinguished (section 17 of Limitation Ordinance).

34.  To establish a claim on adverse possession, the plaintiff must prove two elements:-

(1)  the plaintiff has factual possession, that is having a sufficient degree of exclusive physical control over the land; and

(2)  the plaintiff has the requisite intention to possess (animus possidendi) the property to the exclusion of the owner and the world at large. 

The above principles have been clearly enunciated by the court of final appeal in Incorporated Owners of San Po Kong Mansion v Shine Empire (2007) 10 HKCFAR 588, which adopted the principles set out in Powell v McFarlane (1977) 38 P&CR 452.

35.  Existence of factual possession is a question of fact.  It must be a single and conclusive possession that signifies an appropriate degree of physical control.  The degree of control required depends on the circumstances, in particular the nature of the land and the manner in which it is usually enjoyed (Powell v McFarlane, supra).

36.  Adverse possession has been described as "possession as of wrong", and the possession, to be adverse, must be wrongful and there is a dispossession of the paper owner (JA Pye (Oxford) Ltd v Graham [2003] 1 AC 419).

37.  The squatter must prove that he has the required intention to “possess” the land, he does not have to prove that he has an intention to “own” the land. The squatter shall have "an intention for the time being to possess the land to the exclusion of all other persons, including the owner".  (Buckinghamshire County Council v Moran [1990] Ch 623).

38.  The required intention must be determined objectively.  The intention to possess and to exclude the owners must be manifested unequivocally.

39.  The squatter must show that he took possession of the land in his own right and not as licensee or representative of another person, even if that other person is not the true owner or an agent acting on behalf of the true owner. (Pang Yiu Chor and others v Wong Wai Leung and others, unreported, HCMP 3972 of 2000, 17 September 2013; Tsang Foo (also known as Fu) Keung and Key Kwong Development Limited v Chu Jim Mi Jimmy, being sued as the personal representatives of the estate of Yu Lai Ying, deceased and the personal representative of the estate of Chu Kwok Chung, deceased, unreported, HCA 7140 of 1995, 30 June 2015)

40.  There is a divergence of views between the English law (in Pye, supra) and Hong Kong law (in Wong Tak Yue v Kung Kwok Wai David, (1997-1998) 1 HKCFAR 55) in respect of how a court shall consider self-serving statement of the occupier as to what was his intention.  In Wong Tak Yue, the court of final appeal held that a squatter’s intention to pay rent after the termination of tenancy would destroy the necessary intention to possess. In Pye, the House of Lords took the view that what was required was the intention to possess, not intention to own, the occupier’s willingness to pay for the occupation of the land did not matter provided that the occupier had the necessary possession and the intention to possess at all times.   This court is bound by the court of final appeal decision in Wong Tak Yue.

41.  I have considered the evidence before this court objectively. I accept the plaintiff’s evidence that he has been in exclusive physical possession of the Property since 1987, which is more than 20 years prior to the commencement of this action in 2015.  I also accept that the plaintiff has the requisite intention to possess the Property to the exclusion of the defendant, the other co-owner, and the world at large since 1987.

42.  However, these are not sufficient to support the plaintiff’s claim for possessory title in the 5/6 shares of the Property against the defendant, a co-owner.

Ouster is required in the case of adverse possession against co-owner

43.  By virtue of the unity of possession at common law, co-owners (both joint tenants and tenants in common) are entitled to occupy the entire land or took the rents and profits in their entirety.

44.  The occupation of the entire land by a co-owner does not by itself amount to adverse possession, and would not start the time running.  The evidence of further act, such as ouster is required.  (Megarry and Wade, The Law of Real Property, 8^th edition, paragraph 35‑042)

45.  Mr Wong, counsel for the plaintiff, submitted that the position in Hong Kong is different.  He relied on the following passage in Halsbury’s Laws of Hong Kong, volume 35:-

“[230.853] At common law possession by one co-owner of the whole of the land was not adverse against the other co-owners. Under the Limitation Ordinance the possession of one co-owner can be adverse to the title of the other co-owners where the co-owner in possession has the necessary animus possidendi, that is the intention to possess the whole of the land to the exclusion of the other co-owners, for the period of limitation.”

46.  No authority was cited in Halsbury’s Laws of Hong Kong to support the above proposition that Mr Wong relied on. 

47.  Apart from citing the above passage in Halsbury’s Laws of Hong Kong,there is no or very limited analysis in Mr Wong’s written and oral submission to deal with the legal principles applying to adverse possession against co-owners.

48.  Mr Wong told me at the hearing that the above proposition in Halsbury’s Laws of Hong Kong has been accepted in Cheung Pak Cheong and another v Tong Keng alias Tong Keng Sum, unreported, DCMP 1706 of 2012, 31 December 2012.  Mr Wong urged me to accept the same proposition.

49.  I note that Mr Wong was the counsel represented the plaintiffs in Cheung Pak Cheong and the defendant was absent.   I also note from the judgment that on the point of adverse possession against co-owner, the court in Cheung Pak Cheong was first satisfied that the Limitation Ordinance does not exclude adverse possession among co-owners, and then referred to an extract in Halsbury’s Laws of Hong Kong which is substantially the same as the passage quoted in paragraph 45 above.  No other authorities or principles on this point have been referred to in the judgment. It appears that the court in Cheung Pak Cheong did not have the benefit of considering the other relevant authorities which I recite below.

50.  With respect, the above proposition in Halsbury’s Laws of Hong Kong is incorrect.  There are clear local authorities holding that in the case of co-owners, mere exclusive possession and animus possidendi are not sufficient, evidence of ouster is required.  

51.  Mr Wong has not referred this court to any one of these authorities which I set out below.

52.  In Lai Wai Kuen v Wong Shau Kwong [2004] 4 HKC 528, Lam J (as the learned Judge then was) held that:-

“7. Given that the Defendant and Madam Lai were co-owners, there has to be ouster before the possession of Madam Lai could be treated as adverse, see Culley v Doe d Taylorson (1840) 11 Ad & El 1008 applied recently in Chou Mei Iu v Kung Mui Fong HCMP 2026 of 2000, 28 February 2003, Paras. 20-27”

53.  The necessity to prove actual ouster or dispossession in adverse possession against co-owner has been clearly held by the court of appeal in Tang Tak Sum v Tang Kai Fong [2015] 1 HKLRD 286. In this case, the court of appeal expressly rejected the submission that where a co-owner is claiming adverse possession against the other co-owner, it is not necessary to prove actual ouster or dispossession.

“34. The starting point is that the possession of one tenant in common ‘A’, in his capacity as tenant in common, can never bar the other co-tenant ‘B’, because such possession is not adverse to B’s rights, but in support of their common title. By paying B his share, A acknowledges B as co-tenant. A’s refusal to pay B his share is not by itself sufficient, without denying his title: Prosser at p.1053.”

“39. I have to disagree with the Judge’s acceptance of Mr Shum’s submission below that where a co-owner is claiming adverse possession against the other co-owner, it is not necessary to prove actual ouster or dispossession.”

54.  The court of appeal held that the court below is wrong to conclude that there was adverse possession by relying on the evidence that a co-owner (the defendant in that case) and his predecessor had collected and received all the rent for their own use and benefit without accounting to the other co-owners (the plaintiffs in that case) since 1978.  Proof of ouster is needed.  In that case, there was evidence that one of the plaintiffs had visited the land and parked the car there without payment, and the defendant expressly disavowed having any intention to eject the plaintiffs from the land. The court of appeal found that there was no ouster and the claim on adverse possession was dismissed.

55.  Tang Tak Sum was followed in subsequent court of first instance cases.

56.  In Lo Kau Kun v Cheung Yuk Yun, unreported, HCA 152 of 2013, 24 February 2015, Mr Lo left the property in 1993 after a heated argument with Ms Cheung over another woman and under the advice of the police whom arrived after Ms Cheung attacked Mr Lo with a knife and Mr Lo had screamed for help.  Mr Lo took the advice of the police and left the property leaving all his belongings in it and never returned since then.  Mr Lo and Ms Cheung are co-owners of the property.  Ms Cheung claimed adverse possession.  Deputy High Court Judge Sakhrani has considered various authorities including Tang Tak Sum, held that Ms Cheung has failed to prove that there was actual ouster or dispossession of the plaintiff from the property.  The court declined to presume an ouster since the circumstances under which the plaintiff left the property was clear. The court accepted that the plaintiff had never abandoned his title in the property. The defendant’s claim on adverse possession was dismissed.

57.  In the case Official Receiver, the Trustee of the Property of Leung Man Yuen v Leung Man Yuen and another, unreported, HCB 582 of 1996, 20 September 2016, G Lam J referred to Tang Tak Sum and held that a co-owner of land can establish adverse possession against the other co-owner provided there has been ouster of the latter by the former.

58.  In the present case, there is clearly no evidence of actual ouster of the defendant by the plaintiff.  Quite the contrary, it was the plaintiff’s own case that the defendant left the property on his volition.  In the initial period, the plaintiff and his family still took the view that the defendant might return to the property.

59.  This brings me to consider whether on the evidence before the court, ouster can be inferred or presumed. 

60.  I shall start with Doe ex dim Fishar and wife, and Taylor and wife v Prosser (1774) 1 Cowp 217.  In Prosser, there was no evidence of actual ouster, the court let the jury to decide whether on the fact of that case, actual ouster can be presumed.  In that case, Mary Taylor, one tenant in common of the land had died for nearly 40 years.  In these nearly 40 years, the other co-owner had been in sole possession of the land without any claim or demand by any person claiming under Mary Taylor.  Lord Mansfield said that:-

“It is a possession of near 40 years, which is more than quadruple the time given by the statute for tenants in common to bring their action of account if they think proper; namely, six years: but in this case no evidence whatsoever appears of any account demanded, or of any payments of rents and profits, or of any claim by the lessors of the plaintiff, or of any acknowledgement of the title in them, or in those under whom they would now set up a right. Therefore, I am clearly of opinion, as I was at the trial, that an undisturbed and quiet possession for such a length of time is a sufficient ground for the jury to presume an actual ouster, and that they did right in so doing.”

61.  In Lai Wai Kuen, Lam J (as the learned Judge then was) applied Prosser and held that ouster was presumed in that case where there was a period of about 50 years during which the plaintiff had undisturbed and quiet possession without any demand from her co-owner.  It was held that:-

“11. On the other hand, we have a very long period (from 1950’s to today [2004] during which the Defendant did not have any occupation or access to the property. He did not make any demand for account and there had been no payment of rent or profits to him throughout the years. There was also no acknowledgement of title. Madam Lai and her tenant had a long undisturbed and quiet possession. The case is indistinguishable from Doe d Fishar & Taylor v Prosser (1774) 1 Cowp 217. The court can presume ouster in such circumstances and I will so presume.”

62.  I shall also add that in Tang Tak Sum, the court of appeal has considered Prosser and did not reject the possibility to presume actual ouster on the facts of the case.   In Tang Tak Sum, there was clear evidence of free use of the land at least on one occasion by the co-owner against whom adverse possession was claimed, no ouster can be presumed.  The court of appeal held that the slightest acts done by the paper owner will be found to negative discontinuance of possession because an owner who has the right to possession of land will be readily assumed to have the requisite intention to possess, unless the contrary is clearly proved.

63.  Back to the present case, on the evidence before the court, the defendant had abandoned the Property since 1970s.  Since then, the plaintiff and his family had not heard from him. The defendant did not have any occupation or access to the Property.  No rental or profits earned from the Property had ever been paid or accounted to the defendant. There was no claim whatsoever on the right to use the Property or the rents collected on the lease of the Property from the defendant or any one claiming under him. 

64.  The plaintiff and his family had the undisturbed and quiet possession of about 40 years counting from 1970s. The plaintiff himself had the undisturbed quiet exclusive possession of about 30 years counting from 1987.

65.  In the circumstances, I am satisfied that on the facts of the case, there was sufficient long period of dispossession by the defendant during which the plaintiff and his family had enjoyed the undisturbed and quiet possession of the entire Property, including those parts owned by the defendant (see Prosser and Lai Wai Kuen). I considered that ouster can be inferred or presumed and I so held.

Order

66.  I make the declaration in terms of paragraphs 2 to 3 of the originating summons.  As to declaration under paragraph 1 of the originating summons, it should be amended to the following terms:-

“a declaration that the plaintiff has been in adverse possession of the Property known as 3^rd Floor, No. 160 Reclamation Street, Kowloon, Hong Kong for a period exceeding 20 years prior to the commencement of this proceedings and has thereby acquired possessory rights, titles and interests in 5/6 shares of the Property registered in the name of the defendant.”

67.  The plaintiff does not seek costs and there is no order as to costs.