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HCA 1509/2012
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
ACTION NO 1509 OF 2012
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BETWEEN
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JADE’S REALM LTD |
Plaintiff |
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and
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DIRECTOR OF LANDS for and on behalf of THE GOVERNMENT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION |
Defendant |
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| Before: Hon Ng J in Chambers |
| Dates of Hearing: 16 April 2013, 4 March & 22 May 2014 |
| Date of Judgment: 29 May 2014 |
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J U D G M E N T
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Introduction
1. This is an application by the Defendant by summons dated 7 March 2013 for an order under RHC Order 29 rule 2 that:
“The Defendant or such officers as may be authorised by the Defendant from time to time with or without equipment be authorised to enter upon and inspect Lot Nos. 355 and 356 in DD 214 and the adjoining Government land (including any land in dispute) together with any building erected thereon…”
2. The application is opposed by the Plaintiff.
3. The first hearing of the application took place on 16 April 2013. It was adjourned sine die with leave to the parties to file evidence in support of / opposition to the application. On the same day, this court ordered there should be a split trial of liability and quantum of damages, with the issue of liability to be determined first before a Judge and the issue of quantum to be heard by a Master.
4. The matter was restored before this court on 4 March 2014 whereupon it was further adjourned to enable the parties to prepare a common set of plans (collectively “the Common Plans”) to replace the existing ones annexed to the amended Statement of Claim and the amended Defence and Counterclaim.
5. Eventually,
(1) the plans attached to the amended Statement of Claim at Schedules 1, 2, 4, 5, 6 & 7 are replaced by those in Schedules 8, 9, 10, 11, 12, & 13.
(2) the plans attached to the amended Defence and Counterclaim at Schedules A, B & D are replaced by those in Schedules E, F & G.
The Plaintiff’s case
6. As pleaded by the Plaintiff, the Hong Kong Government[1] was and is the owner of a piece of land in DD 214 (“Land”) in Nam Wai, Sai Kung, New Territories. For identification purpose, the Land is shaded yellow on a plan annexed to the amended Statement of Claim now replaced by the 8th Schedule (“8th Schedule Plan”).
7. By a Block Crown Lease dated 27 March 1907, Lot Nos. 355 and 356 in DD 214 (“the Lots”) were granted to one Yau Chiu Wa and others who were members of the Yau Clan. Through a chain of assignments, the Plaintiff became the registered owner of the Lots on 7 September 2007 and has remained so ever since. For identification purpose, the Lots are shaded pink on a plan annexed to the amended Statement of Claim now replaced by the 9th Schedule (“9th Schedule Plan”). The Lots adjourn the Land and are completely surrounded by it.
8. The Lots and the Land (collectively as “Enclosed Area”) are delineated by a stone wall traced purple (“Stone Wall”) on a plan annexed to the amended Statement of Claim now replaced by the 10th Schedule (“10th Schedule Plan”).
9. As pleaded in paragraph 8 of the amended Statement of Claim, between 1907 and 7 September 2007, a number of houses and structures (“Houses and Structures”) had been “constructed, completed and rebuilt” by the Plaintiff’s predecessors-in-title and the Plaintiff on the Enclosed Area. For identification purpose, the Houses and Structures are shaded green on the 10th Schedule Plan.
10. On the Plaintiff’s case, the Stone Wall was built in or about 1937 by the then registered owners of the Lots and members of the Yau Clan. Since not later than 1937, the Enclosed Area has been in the exclusive possession of and enjoyed by the Plaintiff’s predecessors-in-title and the Plaintiff as a single tenement.
11. It is further the Plaintiff’s case that, despite changes in ownership, the predecessors-in-title of the Plaintiff continued to possess exclusively the Enclosed Area and incur money and money’s worth in the maintenance, repair and reconstruction of the Stone Wall and the Houses and Structures. Further, since 7 September 2007, the Plaintiff has continued and still continues to occupy the Enclosed Area and incur money and money’s worth in the maintenance, repair and reconstruction of the Stone Wall and the Houses and Structures.
12. In the prayer for relief, the Plaintiff claims inter alia:
(1) a Declaration that the Defendant’s title of and in the Land has been extinguished by virtue of the Limitation Ordinance;
(2) a Declaration that the Plaintiff has acquired a squatter’s title to the Land;
(3) a Declaration that the Lots are as identified in the 9th Schedule Plan.
13. The Plaintiff has also put forward a number of alternative cases with regard to the locations of the Lots and the Land. For identification purpose, these locations are colour-shaded on the plans annexed to the amended Statement of Claim now replaced by the 11th, 12th and 13th Schedules. In the prayer for relief, the Plaintiff claims similar Declarations with regard to the Land and the Lots so identified.
The Defendant’s case
14. The Defendant disputes the Plaintiff’s claims on a number of grounds. For the present purpose, this court needs only mention four.
15. First, the boundaries of the Lots are not as set out in the plans annexed to the amended Statement of Claim. Rather, they are as indicated on a plan annexed to the amended Defence and Counterclaim now replaced by Schedule E (“Schedule E Plan”).
16. Second, there were acknowledgments of the Government’s title to the Land by the Plaintiff’s predecessors-in-title at various times between 1962 and 2006, so that the limitation period should be deemed to commence only on the dates of the acknowledgements pursuant to section 23 of the Limitation Ordinance.
17. Third, the Defendant disputes the time when the Houses and Structures referred to in paragraph 8 of the amended Statement of Claim were erected. The Defendant’s pleaded case, at paragraph 10(A) of the amended Defence and Counterclaim, is that they were first seen on the dates set out below and identified on a plan annexed to the amended Defence and Counterclaim now replaced by Schedule G (“Schedule G Plan”).
Area |
Date |
E1a (Structure No. 1[2] in BLUE) |
11 June 1972 |
E1b (Structure No. 1 in ORANGE) |
6 February 2004 |
E2a (Structure No. 2) |
27 December 1956 |
E2b (Structure No. 2) |
3 October 1972 |
E3 (Structure No. 3) |
19 February 1963 |
E4 (Structure No. 4) |
October 1974 |
E5 |
1959 |
E6 |
3 October 1984 |
E7a |
27 July 2008 |
E7b |
22 November 2007 |
18. Fourth, the occupation of some of the Houses and Structures ie Structures Nos. 2, 3 & 4 was allowed to continue with the Government’s consent or licence consequent upon a territory-wide stock-taking survey on squatting structures in 1982 by the Squatter Control Unit of the Housing Department and, for that reason, was not adverse.
19. In its amended Counterclaim, the Defendant counterclaims for:
(1) a Declaration that the boundaries of the Lots are as set out in the Schedule E Plan;
(2) an Order for the delivery of vacation possession of the Land to the Government; and
(3) mesne profits for the Plaintiff’s wrongful use and occupation of the Land since September 2007.
The application
20. Under RHC O 29 r 2 as well as under its inherent jurisdiction, the court may make an order for the inspection of property in the possession of a party to the cause or matter. The power to order inspection is discretionary and will be exercised to “secure a just and proper trial of the issues” in the case: Laguna Properties Limited v. New Trend Investment Limited unrep. HCA 19128/1998, 13 May 2004 at [9] per Tang J (as he then was).
21. The important question is thus: what are the issues in this case the “just and proper” resolution of which will be assisted by a site inspection ?
22. The parties’ pleaded cases have already been summarized above.
23. In his Affidavit dated 30 April 2013, Mr Tse Wai Kin, a senior Land Surveyor of the Lands Department, said this in support of the application:
“13. For the purpose of verifying the extent of suspected unauthorized occupation on the [Government] Land, the Defendant conducted ground survey of the houses and structures erected on the Lots and the [Government] Land in November 2008.
14. It appears that the extent of the houses and structures on the Land Lots as pleaded by the Plaintiff and as set out in the 4th Schedule[3] of the Statement of Claim is different from that as surveyed by the Defendant in November 2008 and that as revealed from the relevant aerial photographs taken between 2008 and 2012.
15. In order to consider the Plaintiff’s pleaded case in respect of the extent of the houses and structures as shaded green in the 4th Schedule of the Statement of Claim, it is my opinion that access to the site …is necessary.” (emphasis added)
24. At paragraph 7 of his Second Affidavit dated 20 June 2013, Mr Tse reiterated that:
“…a site inspection is necessary in order for the Defendant to consider the Plaintiff’s pleaded case in respect of the houses and structures as shaded green in the 4th Schedule of the Statement of Claim…For the avoidance of doubt, the Defendant is not saying that the site inspection is to be conducted to determine the correct boundaries of the Land Lots right away. Its purpose is to verify the Plaintiff’s case with regard to its claims made in paragraphs 8 to 13 of the Statement of Claim.” (emphasis added)
25. In support of the application, Ms Wu, at paragraphs 22 and 25 of her skeleton arguments dated 14 May 2014, submits that
(1) the Defendant is entitled to inspect the extent of the Houses and Structures pleaded by the Plaintiff in the amended Statement of Claim and as identified and shaded green in the 10th Schedule Plan (“1st Ground”);
(2) the Defendant cannot come to a view on the quantum of mesne profits if the court does not allow inspection, the result of which is that the Defendant will not be able to commence any mediation with the Plaintiff, contrary to the objectives of the CJR (“2nd Ground”).
26. Regarding the 1st Ground, it is unclear from Ms Wu’s submissions exactly why the Defendant is “entitled” to inspection, given the power to order inspection is essentially a case management power and is discretionary.
27. In the view of this court, not only is the Defendant not “entitled” to inspection, the Defendant has not even made out a case that it is “just and proper” to make an order for inspection. The reasons are these.
28. First, as noted in paragraph 10 above, the Plaintiff’s pleaded case on adverse possession is based on the exclusive possession of the Enclosed Area by the Plaintiff’s predecessors-in-title and the Plaintiff continuously since 1937. In the course of the hearing, this court asked and Ms Wu accepted that there is no dispute between the parties as to the location of the Stone Wall as such. Ms Wu also indicated to this court that there is no dispute that the area within the Stone Wall ie the Enclosed Area consists of the Lots and the Land. If so, it would mean that as far as the location and extent of the Enclosed Area is concerned, there is no issue between the parties – they only differ on the location of the Lots within the Enclosed Area.
29. However, as pointed out by the Plaintiff’s expert, Dr Conrad Tang,it is not possible for a field survey to identify the correct boundaries of the Lots now because there are no currently existing ground features which correlate to the features shown on the Plan (known as the DD Sheet) contained in the Crown Lease. This is accepted by Mr Tse. As evident from Ms Wu’s skeleton submissions, the Defendant is not suggesting that site inspection is necessary or feasible in order to determine the correct boundaries of the Lots.
30. Second, as noted in paragraph 17 above, the Defendant’s pleaded case is not that the Houses and Structures pleaded in paragraph 8 of the amended Statement of Claim and shaded green in the 10th Schedule Plan do not exist or are not located within the Enclosed Area – its case is simply that they were first seen on divers dates between 1956 and 2008. There is no suggestion by the Defendant that a site inspection can shed light on when the Houses and Structures were first erected, let alone first seen. It is also difficult to see how a site inspection can verify the Plaintiff’s pleaded case that, between 1907 and 7 September 2007, the Houses and Structures had been “constructed, completed and rebuilt” by the Plaintiff’s predecessors-in-title and the Plaintiff on the Enclosed Area.
31. Third, a comparison between the Plaintiff’s 10th Schedule Plan with the Defendant’s Schedule G Plan suggests that the locations of the Houses and Structures on both plans appear to be the same. When asked about this in the course of the hearing, Ms Wu frankly accepted that was the case and this court had not misread the plans. If so, as far as their pleaded cases are concerned, there is no issue between the Plaintiff and the Defendant as to the location of the Houses and Structures within the Enclosed Area either.
32. Fourth, while Mr Tse claims to have found a discrepancy between the extent of the Houses and Structures identified in the plan annexed as the 4th Schedule[4] of the Statement of Claim and that as revealed from (i) a survey by the Defendant in November 2008 and (ii) aerial photos taken between 2008 and 2012, there is no explanation from him as to what that discrepancy is or why it is necessary to conduct a site inspection, given that the Defendant had already carried out a survey and obtained the relevant aerial photos. There is also no explanation from Ms Wu as to the relevance of the discrepancy to the Plaintiff’s or the Defendant’s pleaded case.
33. As this court sees it, the Defendant is bound by its pleaded case. On its pleaded case, there is no dispute between the parties as to the location of the Houses and Structures within the Enclosed Area. In any event, the exact location of the Houses and Structures within the Enclosed Area is irrelevant to the Plaintiff’s claim for adverse possession of the Land within the Enclosed Area or the Defendant’s defences. For these reasons, the 1st Ground fails.
34. Regarding the 2nd Ground, given the order for split trial, it seems to this court prima facie premature to order inspection now with a view to facilitating the assessment of mesne profits when the court has yet to adjudicate upon the Plaintiff’s alleged liability for trespass on the Land. There is no answer to this in Ms Wu’s skeleton argument.
35. Further, while it is desirable that disputes between the parties can be resolved by mediation, it does not vitiate the need for the Defendant to demonstrate to this court that (i) there are disputes on liability which call for a site inspection, (ii) it is “just and proper” to allow a site inspection so that a meaningful mediation on liability can proceed. This the Defendant has utterly failed to do. In particular, the Defendant has failed to provide any explanation as to why the parties cannot proceed to mediate on liability issues first, leaving aside the question of mesne profits at a later stage, if at all. In these circumstances, the 2nd Ground also fails.
Disposition and Costs Order nisi
36. For the above reasons, this court is not minded to exercise its discretion in favour of allowing a site inspection. The Defendant’s application is dismissed.
37. There shall be an order nisi that costs be to the Plaintiff, with certificate for counsel.
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(Peter Ng)
Judge of the Court of First Instance
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High Court |
Mr K M Chong, instructed by Deacons, for the plaintiff
Ms Teresa Wu, instructed by Secretary for Justice, for the defendant
[1] The term is intended to include the Colonial Hong Kong Government before 1 July 1997 and the Government of Hong Kong SAR on and after 1 July 1997.
[2] Structure 1 in the Schedule G Plan is the Stone Wall.
[3] Now replaced by the 10th Schedule.
[4] Now replaced by the 10th Schedule.
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