HSBC PRIVATE TRUST (HONG KONG) LTD v. AU YEUNG CHUNG

CACV 69/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 69 OF 2008

(ON APPEAL FROM HCA NO. 1662 OF 2001)

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D E C I S I O N

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1.  This is an application for stay pending appeal.  It is a case in which the judge below had the advantage not only of hearing from some of the relevant witnesses, but he had also the advantage of having seen the land.

2.  It seems to be quite clear from his judgment that he regarded this as land which has at best been used -- it used to be used, of course, - for cultivation of what might be called market gardening and minor livestock rearing.  More recently it has been used only as a banana plantation which, of course, does not need very much attendance at all, and also for container storage.

3.  There is not a word in the judge’s judgment about the land having been used, recently at any rate, as a residence.  Considering the fact that he has had the advantage of a full inspection of the land together with the parties, it would be surprising that he came to the conclusion that he did that, basically, the defendants were not using the land any more.  Certainly, I would have expected him to have said if there was any sign of residence on the land.

4.  When the matter came before the judge on 11 April for a stay of execution, he used these words:

“The fact is the defendant and her family have rather lost interest in this land save, of course, for the very real interest which lies in its monetary value, and if the defendant were to succeed on appeal, then I have absolutely no doubt she would be properly compensated for having succeeded in the appeal by the plaintiffs, if, in fact, they had by then fortunate enough to secure the sale of the land before the appeal was resolved.”

5.  On that basis, the judge did not consider that the appeal would be nugatory if a stay were refused.

6.  Since then, the defendant, who had not given evidence at trial but, of course, was properly represented and, in fact, had the assistance of her son who apparently, the judge considered, was probably the person most interested in pushing the litigation, but who lives in Canada, said this:

“4.    Even till now, I still live in the residential structures on the subject Land.  I would only stay in the house on the government land when the weather becomes too hot or when there were thunder storm.  I live in residential structures on the subject land because I am so sentimentally attached to the said structures which we ourselves built on the subject Land. 

5. All the structures on the subject Land were built by us, and we transformed a piece of abandoned, uncultivated land into agricultural land.  We put in a lot of effort to effect the transformation, working day after day over a substantive period of time.  Even though we do not now carry out large scale farming, we have planted many banana trees, mango trees on the subject land, and we tend the trees and collect the fruit.  The subject land is not left unattended by us.”

Then the affirmation goes on to talk about other things which they have done on the land.

7.  I have to say that, in the light of the bare outline of the judge’s conclusions, that affidavit has to be regarded with some degree of circumspection because it certainly does not tie up with what the judge has said in his judgment and on the application for stay, and it does not accord with what he might be expected to have said, had that been correct, after the inspection took place.

8.  In my view, I do approach this on the basis that if the defendant could be properly compensated, should this Court or the Court of Final Appeal come to the conclusion that the appeal succeeds, then a stay should not be granted.  I do so on the basis that, although Miss Yiu has put forward the appeal on law, I wish to say no more about it at this stage than I approach the case on the basis that the defendant does have an arguable case on appeal.  It would be wrong for me at this stage to go into the matter any further or to say any more on the matter.

9.  There was one point which concerned me and that was whether, if this Court or the Court of Final Appeal were to overturn the judgment and to hold that the defendant did have a defence to possession, but that the land had already been disposed of or developed in the meantime as a result of a decision of the Court of First Instance which had been overturned, then whether the problem would then arise as to whether the defendant would be entitled to damages.

10.  Mr Shaw, who has appeared on behalf of the plaintiff, has indicated that he is prepared to take his client’s instructions as to whether an undertaking would be given to indemnify the defendant, in case the defendant’s appeal succeeds, for any damages that might have been suffered as a result of the defendant having lost at first instance and, therefore, the plaintiff having obtained possession.

11.  So I will order that there be no stay but that the judgment should lie in Chambers for 10 days and that if the plaintiff is not in a position to give that undertaking, the matter should be mentioned to me on 10 June so the matter can be revisited.

12.  In the meantime, however, the defendant has applied for legal aid.  That was refused.  After the refusal of legal aid, the plaintiff, not surprisingly, took out an application for security for costs on the appeal.  Then having done that, they were informed, on 29 May, which is only last week, that that matter is being appealed and the appeal in respect of legal aid is to be heard on 1 August.  Very properly, Mr Shaw said if he had known about that, he would not have made the application until that appeal had been disposed of and he could see whether legal aid were granted.

13.  I consider that what should happen in those circumstances is that that application should really be adjourned until after 1 August.  Once the decision as to whether the defendant should have legal aid has been made, then the plaintiff can decide whether to pursue their application or not.

14.  I think the costs, up until today, thrown away by reason of the application having been made should be to the plaintiff in any event.

(Submissions by counsel)

15.  Costs of the stay application in the cause.  Application adjourned sine die with liberty to restore.  Ten minutes security for costs and 35 minutes for the stay.