TANG WAI HON v. ALL OCCUPIERS AND ANOTHER

HCA809/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 809 OF 2011

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BETWEEN

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J U D G M E N T

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1.  There is before me an application by the Plaintiff for summary judgment against the 2nd Defendant in the action, alternatively for interim payment.

2.  The claim concerns a piece of land in Yuen Long, New Territories, Hong Kong, registered in the Land Registry as Lot No. 2923 in Demarcation District No. 111.  I shall refer to it as “the land.”

3.  There is no dispute that the registered owner of the land is Tang Teng (or Ting) Hong Tso, alias, Tang Tin Hong Tso. 

4.  The Plaintiff entered into a lease in Chinese dated 21 December 2010 with the managers of the Tso whereby the Tso leased the property to the Plaintiff for a term of five years, commencing 1 January 2011 at yearly rent of HK$498,983.  The Plaintiff is therefore, prima facie, entitled to possession of the property from 1 January 2011 until 31 December 2015.

5.  Equally there is no dispute that notwithstanding the commencement of the term of the Plaintiff’s lease on 1 January 2011 a number of persons who were either the tenants or licensees of the 2nd Defendant were in occupation of a portion of the land.  I shall refer to this part of the land as “the property.”

6.  The Plaintiff accordingly commenced proceedings by writ on 12 May 2011 against the occupiers, whose identity is unknown to the Plaintiff, as the 1st Defendants, and against their landlord or licensor, the 2nd Defendant.

7.  Until 21 October 2011, the only defence raised by the 2nd Defendant is that he rented the land from one Mr Tang Mei Tong under a yearly tenancy whereby half a year’s notice to quit was required before the tenancy could be terminated. 

8.  It is said that the 2nd Defendant has not received any notice to quit from Tang Mei Tong and is therefore still entitled to possession of the land. 

9.  This ground of defence is untenable. While Mr Tang Mei Tong himself had leased the land from the Tso, that lease was for a period of five years, commencing on 1 January 2006.  The lease being for a fixed term and there being no requirement for any notice to terminate within the lease, it automatically expired by effluxion of time on 31 December 2010. 

10.  In fact, according to a copy of the lease that was granted by Tang Mei Tong to the 2nd Defendant, exhibited to the latest affirmation of the 2nd Defendant filed yesterday, that lease was for a term of three years from 1 January 2008 to 31 December 2010.  It was provided there that the 2nd Defendant upon the expiration of the term should unconditionally deliver possession of the property back to Mr Tang Mei Tong.  There was no provision for any notice of six months or otherwise to terminate the lease.

11.  This morning Mr Jim for the 2nd Defendant also referred me to a provision in the lease granted by the Tso to Mr Tang Mei Tong which stated that if the tenant would like to continue to rent the land after the expiration of the term, then he should, three months before expiry of the term, contact the landlord, that is, the Tso.  The decision whether or not to continue to let the land to the tenant will be a matter for the landlord.

12.  In my judgment, that clause does not assist the 2nd Defendant.  There is no dispute that the Tso had decided to let the land to the Plaintiff instead. There is no legal basis on which the 2nd Defendant or Mr Tang Mei Tong can challenge the decision of the Tso in this regard.

13.  With the expiration of the head lease of Mr Tang Mei Tong in relation to the land, any sub-lease that the 2nd Defendant may have been granted by Tang Mei Tong in respect of the property also came to an end.

14.  Indeed, according to the copy of the sublease exhibited by the 2nd Defendant in the affirmation filed yesterday, that sublease also on its own terms came to an end on 31 December 2010.  Such sublease is therefore no defence to the Plaintiff’s claim for possession of the property. That much seems clear to me.

15.  Indeed, on 22 September 2011, solicitors then acting for the 2nd Defendant wrote to the Plaintiff’s solicitors stating that the 2nd Defendant “would like to deliver up possession” of the property to the Plaintiff and “have judgment entered against him for the possession of the suit property with damages to be assessed.”

16.  The 2nd Defendant then changed solicitors.  On 12 October 2011 his present solicitors gave notice of the change to the Plaintiff and indicated they had instructions to apply for leave to amend the 2nd Defendant’s defence.  That application was not made until 21 October 2011 when by a summons the 2nd Defendant seeks leave to amend his defence to raise a number of points.  No affirmation in support was then filed by the 2nd Defendant. 

17.  Indeed, no affirmation had previously been filed at all by the 2nd Defendant in opposition to the Plaintiff’s application for summary judgment.

18.  Nevertheless, I have considered the points raised by the proposed amendment to the defence. I am satisfied that they do not raise any triable issue. 

19.  First, it is said that the Plaintiff’s lease in Chinese, dated 21 December 2010, was not stamped and cannot be received into evidence by virtue of section 15 of the Stamp Duty Ordinance.  This seems to me to be a false plea.  A copy of the lease put in evidence by the Plaintiff and sworn by him to be a true copy thereof shows that it has been duly stamped. 

20.  It is true that a document dated 23 January 2011 made between the Plaintiff and the four managers of the Tso, which has been called the supplemental lease, has not been stamped.  But that document is really in the nature of a confirmation of the Plaintiff’s rights and the fact that it is not stamped does not affect the lease on which the Plaintiff relies for his title.

21.  The proposed amendment also elaborated upon the point that no notice to quit has been served on the 2nd Defendant adding that no notice to quit has been served by the Tso on Tang Mei Tong either.

22.  For the reasons I have already given this raises no triable issue.

23.  Thirdly, the 2nd Defendant said that his own tenant had been evicted by the Plaintiff from the land as a result of which the 2nd Defendant has suffered loss and damage, which the 2nd Defendant says ought to be set off against any damages for which he may be liable to the Plaintiff.

24.  I cannot begin to see any legal basis for such a claim for damages by the 2nd Defendant against the Plaintiff.

25.  A further matter which is not in the proposed amended defence, but asserted for the first time in the affirmation of the 2nd Defendant filed yesterday, is that the Plaintiff had recovered possession of the property in January 2011.

26.  This assertion is contrary to the 2nd Defendant’s own pleading and also to a solicitor’s letter dated 3 March 2011 which stated that the 2nd Defendant’s tenancy is still valid and subsisting and that the Plaintiff had no legal right to claim possession of the property against the 2nd Defendant at that time.

27.  Mr Jim for the 2nd Defendant also says this morning that there is nothing to show that the gate blocking access to the property belonged to the 2nd Defendant or that the debris and other objects occupying the land belong to him.

28.  But I cannot find in the entire evidence a single such denial.  In particular by a letter dated 8 August 2011 the Plaintiff’s solicitors complained to the 2nd Defendant’s solicitors that the Plaintiff was unable to obtain vacant possession of the property because of the locked gate at the property.  There was no denial in response to that letter that the 2nd Defendant controlled the gate. 

29.  The gate was apparently subsequently demolished and on 22 September 2011, following the offer by the 2nd Defendant’s solicitors of that date, the Plaintiff’s solicitors complained that the 2nd Defendant had dumped materials or trash on the property.  Again there was no response to this letter.

30.  I am therefore satisfied that the Plaintiff is entitled to an order for possession against the 2nd Defendant.

31.  There is also a claim for mesne profits.  So far as the quantum is concerned there is evidence from the Plaintiff that a neighbouring piece of land has been let by him to a company called Egypt Port at the monthly rent of HK$28,000.

32.  Based on that rent and the areas of the respective sites in question the Plaintiff says that the market rent of the property should be approximately HK$28,800.  That, of course, is not expert evidence on the valuation of the market rental income.  However, the 2nd Defendant himself admitted in his late affirmation that he had sublet the property to different tenants at a monthly rent of HK$40,000.

33.  In the circumstances I accept the Plaintiff’s figure as a reasonable estimate.  I would round the figure down to HK$28,800.

34.  In my view it would not be conducive to the proportionate and efficient conduct of litigation to give only interlocutory judgment and for further costs to be incurred by the parties on a relatively small dispute as to the proper quantum of the mesne profits.

35.  I therefore order summary judgment against the 2nd defendant both for possession and for mesne profits at the rate of HK$28,800 per calendar month from 1 January 2011 to the date of delivery of vacant possession of the property to the Plaintiff.

(Discussion on costs)

36.  I would order costs in favour of the Plaintiff to be taxed if not agreed.  The parties can hopefully be sensible enough to try to agree such costs and avoid the costs of taxation.