TSAN LUK YUK YIN v. THE SECRETARY FOR THE ENVIRONMENT, TRANSPORT AND WORKS

LDMR 3/2005

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

Miscellaneous Reference Application No. 3 of 2005

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DECISION

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Background

1.  This is an application made by the applicant by way of summons dated 3 September 2010 to seek leave to file and serve the Expert Report of Professor Barnabas Chung dated 5 November 2009 and the Supplemental Expert Report of Mr Alnwick Chan dated 28 December 2009 (“the new reports”).

2.  The respondent objects to this application on the ground that the applicant is attempting to put forth a new or amended claim for $78,606,000 as set out in the new reports basing on a completely different development model (“the 2009 model”) and the applicant is barred from making a new or amended claim by the operation of sections 27 to 29, particularly the time limit imposed in section 28(5), of the Roads (Works, Use and Compensation) Ordinance, Cap 370 (“the Ordinance”).

3.  The applicant was the registered owner of Lot Nos. 288, 289 and 293 in DD 313, Tai O, Lantau Island, New Territories, Hong Kong (“the Lots”) which have been resumed by the Government since 24 June 1997 pursuant to section 13 of the Ordinance.  By Notice of Application dated 10 November 2005, the applicant applies to the Lands Tribunal in these proceedings for determination of the applicant’s claim for compensation under Item 1 of Part II of the Schedule to the Ordinance.

4.  It was mentioned in the letter dated 23 June 1998 attached to the Notice of Application that the amount of claim was $200 million and valuation report would be submitted in due course.  Then the applicant filed the Expert Report and the Supplemental Expert Report of Mr Alnwick Chan dated 16 November 2005 and 19 September 2006 respectively (“the 2005 & 2006 reports”) setting out the applicant’s claim for $79,430,000 basing on a development model prepared in 2003 (“the 2003 model”), which proposed development to be built over a footpath running through the Lots.

5.  At the hearing of the applicant’s claim on 8 October 2007 and upon the application of the applicant, the Tribunal ordered that a preliminary issue, namely “Was the footpath lying on the subject Lots as at the date of resumption a public right of way by prescription?”, be determined first. At the completion of the oral submissions of counsel for the parties on 9 October 2007, the Tribunal ordered that the hearing of the applicant’s application for compensation be adjourned to a date to be fixed by the parties after the determination of the preliminary issue.

6.  The Tribunal gave its decision on the preliminary issue on 20 November 2007 and held that the footpath was a public right of way by prescription.  There was subsequently a proposed appeal by the applicant against the Tribunal’s decision to the Court of Appeal, but the proposed appeal was eventually not proceeded with.

7.  In view of the Tribunal’s decision on the preliminary issue, the applicant instructed an authorized person to submit to the Building Authority a revised hypothetical building proposal (“the revised proposal”) taking into account the public right of way and containing no building over the footpath.  In April 2008, comments were provided by various government departments on the revised proposal.  Thereafter, the applicant’s authorized person took steps to resolve the technical issues raised by the government departments.  However, by letter dated 24 December 2008, the Building Authority stated that it was not within its ambit to determine the revised proposal on the ground that “Pre-submission enquiries solely related to compensation claims, hypothetical schemes and academic exercises would not normally be entertained by Buildings Department”.

8.  The new reports have been prepared in support of the applicant’s claim for compensation based on the revised proposal.  Professor Chung’s report also addresses various comments raised by the government departments in respect of the revised proposal.  The applicant contends that the new reports are simply further expert evidence for the Tribunal’s determination and they do not amount to a new or amended claim.  Thus, the time limit for service of the claim or any amended claim on the respondent as set out in the Ordinance is irrelevant, and the respondent’s reading and construction of the statutory provisions are plainly wrong.

9.  The applicant further contends that it is unfair for the respondent to raise this contention at this stage when:-

(1)  she has all along been clearly aware of the applicant’s interest in the Lots and also the nature of her present claim, since the claim was first submitted to the District Land Office in July 1998;

(2)  even after the determination of the preliminary issue had been made, the government still proceeded to consider the applicant’s revised proposal and provided its comments on the same; and

(3)  the basis of the revised proposal (ie for development of low-density residential complex) is the same as the previous proposal (accepted by the Building Authority) submitted to the Tribunal before the determination of the preliminary issue.

10.  Even assuming what the applicant is seeking to put forward is an amended claim, the applicant contends that the respondent can no longer allege that the amended claim is time-barred by reasons of waiver, estoppel and acquiescence arising out of the following matters:-

(1)  In the present case, during the period between 1998 and 2004, the applicant and the respondent were involved in a long negotiation on the amount of compensation.

(2)  The proceedings were commenced in the Lands Tribunal in November 2005 after the negotiation had broken down.

(3)  If the respondent’s argument were right, the applicant would have been barred from putting forward any valuation which is different from the original amount of the claim when the proceedings were commenced in the Lands Tribunal in 2005.

(4)  However, both parties in these proceedings have put forward further valuation reports by way of expert evidence.  The respondent has never raised any issue of time bar before October 2010.  The respondent has all along been clearly aware of the applicant’s interest in the Lots and the nature of this claim (since the claim was first served on the District Land Office in July 1998 ie within the one-year period stipulated).  In the present case, the nature of the claim has never changed.

(5)  The applicant has revised the assessment of her claim on various occasions in the past and such revisions were all made beyond the one-year statutory period. However, the respondent never saw fit to raise any issue of time bar until recently.

(6)  The subject-matter of the applicant’s claim has always been the same, ie for compensation in respect of the Lots resumed.

(7)  The respondent has all along been fully aware of the nature of the applicant’s interest and the nature of her claim.

(8)  It is clear to the respondent that the determination of the preliminary issue on the public right of way would have a material impact on the assessment of compensation and would therefore result in revisions of the applicant’s claim.

(9)  The basis of the applicant’s revised proposal (ie for development of low-density residential complex) is the same as the previous proposal submitted to the Lands Tribunal before the determination of the preliminary issue.

(10)   In view of the decision on the public right of way, the applicant’s authorized person, in the revised proposal, has modified the configuration of the blocks intended to be constructed, resulting in a reduction of the number of units from 18 to 9.  However, only minor alterations were made in the revised proposal in terms of site coverage and plot ratio.

(11)   Even after the determination of the preliminary issue has been made, the government still considered the applicant’s revised proposal and provided its comments on the same.

11.  In view of the parties’ contentions, the main issues for me to decide in this application are whether the applicant is putting forward a new or amended claim by adducing the new reports, and if so, whether such a new or amended claim is time-barred and whether the respondent is entitled to raise the time-barred issue now.  I shall deal with these issues below.

Right to compensation

12.  Section 26 of the Ordinance prescribes the rights to compensation as follows:-

“No person shall have any right against the Crown or any other person to recover any money –

(a) in respect of any use authorized under this Ordinance; or

(b)   in respect of any works or anything else authorized under this Ordinance except to the extent of the rights to compensation provided for in section 27.”

13.  Section 27(1) of the Ordinance stipulates that:-

“The compensation referred to in section 26 is the right to recover from the Crown for the matters set out in the first column of Part II of the Schedule a sum assessed on the basis specified opposite thereto in the second column thereof and with regard to the provisions of Part I of the Schedule, subject to-

(a)  the claim being served on the Secretary within the appropriate period specified in the fourth column of Part II of the Schedule.”

(underlines added)

14.  In other words, the right to compensation is qualified and conditional upon the claim being (1) first served on the respondent and (2) served within time.  The claimant cannot directly go to the Tribunal for compensation. The first condition is set out in section 29 of the Ordinance in more details and the second condition in section 28.

Claims procedure

15.  Section 29(1) of the Ordinance provides that any person who claims to be entitled to compensation “shall” serve upon the respondent a written claim setting out such of the following particulars as are applicable to his claim:-

“(a) the name of the claimant, and his address for service of notices;

(b) a full description of the land to which the claim relates including any covenants, easements, rights or restrictions affecting the same;

(c) the nature of the claimant’s interest in the land including in the case of a sub-lessee or sub-tenant his landlord’s name and address and details of the sub-lease or tenancy;

(d) details of any mortgage, including the principal still owing and name and address of the mortgagee;

(e) if the claimant has let the land or any part thereof, the name and address of each tenant and details of his lease or tenancy;

(f) particulars of the claim showing –

(i) the amount of the claim;

(ii) under which item of Part II of the Schedule the claim is made; and

(iii) how the amount claimed under each item is calculated.”

 (underlines added)

16.  The respondent submits that a claim is required by the Ordinance to include not just the demand for a monetary amount but is required to be a claim with sufficient particulars showing how the amount claimed under each item is calculated.  In practice, surveyors acting for claimants always provide an assessment of compensation based on a development model as part and partial of the claim to set out how each item of the claim is calculated.

17.  Under section 29(2) of the Ordinance, the respondent shall in writing acknowledge receipt and the date of receipt of every claim served on him.  Under section 29(3), if a claimant amends his claim before proceedings are commenced in the Lands Tribunal and the respondent considers the amendment to be substantial, the respondent may, within 28 days of the receipt of the amended claim, notify the claimant that he elects to treat the claim as if it were a new claim and the statutory procedure under section 29 shall apply accordingly.

18.  Under section 29(4) of the Ordinance, the respondent may by notice in writing request the claimant to furnish further particulars of and in support of his claim or any item thereof and if any such particulars are not furnished as requested, the claim or the item thereof shall be deemed to be rejected.

19.  Section 29(5) of the Ordinance provides that:-

“The Secretary shall within 6 months of the service of a claim on him or, if he has requested further particulars under subsection (4) within 6 months of the day on which they are furnished in accordance with that subsection, notify the claimant in writing that he –

(a) admits the entire claim; or

(b) rejects the entire claim; or

(c) admits a specified part or parts and rejects the remainder, and in every case shall briefly state his reasons for rejection so that the claimant is adequately informed of those reasons:

Provided that the Secretary may at any time state further reasons for rejection of claim.”

20.  The respondent submits that the statutory claims procedure leading to the admission or rejection of a claim under sections 29(4) and (5) of the Ordinance is always tied to the requirement of a particularized claim under sections 29(1)(f) and (4).

21.  Pursuant to section 29(6) of the Ordinance, where the respondent has rejected a claim or any part thereof under section 29(5), the respondent may by notice in writing offer to the claimant such sum, including costs as agreed or taxed, as the government is willing to pay in full and final settlement of the claim or any part thereof, or commence proceedings in the Lands Tribunal to have the claim determined.

22.  Section 29(7) provides that if a claim has not been settled after 7 months, either the claimant or the respondent may commence proceedings in the Lands Tribunal under the Ordinance.

23.  The respondent submits that under section 29 the right to commence proceedings in the Lands Tribunal to determine a claim is not unconditional.  The right is subject to the claim having first been served on the respondent and having been rejected or not having been settled.  In the case of the applicant’s particularized claim based on a specific development model, it is that claim, which, after the respondent’s rejection, gains the right to be placed before the Tribunal.

Extension of time for service of new or amended claims

24.  Under section 28(1) of the Ordinance, if a claim or an amendment is not served on the respondent before the expiration of the period specified in the fourth column of Part II of the Schedule in respect of that matter, the right to claim compensation therefor shall be barred, but it is subject to the Lands Tribunal’s power to extent time as provided in section 28(4).

25.  As stipulated in the fourth column of Part II of the Schedule, the period within which the claim for compensation in respect of the resumption of land under section 13 of the Ordinance must be served on the respondent is before the expiration of one year from the date of resumption.

26.  According to section 28(2), the period referred to in section 28(1) of the Ordinance may, upon application made to the Lands Tribunal either before or after the expiry of that period, be extended in accordance with section 28.

27.  Section 28(4) of the Ordinance states that:-

“The Lands Tribunal may extend the period within which a claim must be served upon the Secretary if it considers that the delay in serving the claim was occasioned by mistake of fact or mistake of any matter of law (other than the relevant provision in the fourth column of Part II of the Schedule) or by any other reasonable cause or that the Crown is not materially prejudiced in the conduct of its case or otherwise by the delay.”

(underlines added)

28.  Thus, sections 28(2) and (4) of the Ordinance enable the Tribunal to grant extension of time for service of an amended claim after the expiry of the period referred to in section 28(1) (see also Ease Gold Development Limited v Secretary for Transport,CACV 3422 of 2001 and Busy Firm Investment Limited v Secretary for Transport, LDRW 6 of 2001).

29.  However, section 28(5) of the Ordinance limits the length of extension allowed under section 28(4) to six years as follows:-

“An extension may be granted by the Lands Tribunal under subsection (4), with or without conditions for such period as it thinks fit but not in any case exceeding 6 years from the time when the right to compensation first arose.”

 (underlines added)

30.  Accordingly, any new or amended claim which surfaces after the 6-year period is barred.

The applicant’s case

31.  The applicant contends that her claim by letter dated 23 June 1998 was served on the respondent within time.  Section 28 of the Ordinance (read in conjunction with section 29) deals only with the time limit for service of a claim (or any amendment to the claim) on the respondent so as to allow the respondent to consider it within a reasonable time after the date of resumption or any other relevant date.  Hence, such time limit is confined to situations regarding claims made to the respondent and the determination of the claims by the respondent before proceedings are commenced in the Lands Tribunal.  There is no time limit imposed on submission of a revised or amended claim after the respondent has made a decision or after proceedings have been commenced in the Lands Tribunal.

32.  The respondent had already considered the claim. However, the parties failed to reach any agreement on the amount of compensation.  On 10 November 2005, the Applicant commenced the present proceedings in the Lands Tribunal.  The claim is now being considered by the Lands Tribunal which has the power to consider what evidence (including expert evidence) may be adduced by the parties.  In the present application, the applicant simply intends to adduce further expert evidence for the determination by the Lands Tribunal (as opposed to the respondent) in view of the Lands Tribunal’s determination of the preliminary issue.  Hence, the time limit set out in section 28 for service of the claim (or an amended claim) for consideration by the respondent (before proceedings are commenced in the Lands Tribunal) is irrelevant.

33.  There is nothing in the Ordinance which prevents a claimant from revising or amending his claim after the respondent has made a decision (or after proceedings have been commenced in the Lands Tribunal).  In Berwell Trading Ltd v Secretary for Transport [2003] 3 HKC 631, the Lands Tribunal considered, amongst others, an application for extension of time to submit a revised claim for loss of rental and/or disturbance under the Ordinance, and it was held by Judge Lam, Presiding Officer (as he then was) that:-

“The original claim has alerted the respondent as to the applicant’s interest and claim and it was clearly stated to be an interim one. A revised claim after completion of the works must have been expected by the respondent. I am not sure whether an extension is required. An applicant can amend his claim (see s 29(3) of the Ordinance) and there is no suggestion in the Ordinance that a claim cannot be amended after the time bar for filing an original claim.”

34.  The applicant submits that it does not make sense if all revisions to the original claim would have to be made within one year from the date of resumption.  It is common that a claimant, after his original claim is rejected by the government, will adduce further expert report in the proceedings before the Lands Tribunal and such report may contain revisions made to the original claim.  It is plainly wrong for the respondent to suggest that such expert report shall be served on the respondent within one year from the date of resumption.  Such a contention, if accepted, would usurp the powers and functions of the Lands Tribunal which should be entitled to consider all relevant evidence in determining the claim.

35.  It is also wrong for the respondent to allege that the applicant and her professional advisers had deliberately disregarded the issue of the public right of way for the following reasons:-

(1)  By letter dated 10 March 1999 to the District Land Officer, the applicant’s then representatives, Messrs C Y Leung & Co Ltd, stated their view that the footpath did not give rise to a public right of way by prescription.

(2)  Thereafter, the respondent had never indicated that it would take issue on this point until it was raised in the hearing before the Lands Tribunal on 8 October 2007.

(3)  At the hearing on 8 October 2007, it was the applicant who took the initiative of applying for the determination of a preliminary issue as it was contemplated that such a ruling would affect the assessment of compensation.

The respondent’s case

36.  The respondent objects to the applicant’s application for leave to adduce further evidence because the applicant is barred from making a new or amended claim based on the 2009 model.  The respondent contends that the applicant’s intended claim for $78,606,000 as set out in the new reports basing on the 2009 model is a new or amended claim.  Section 28(1) of the Ordinance requires the applicant to serve any new or amended claim upon the respondent within 1 year of the date of resumption subject to the Tribunal’s power of extension under section 28.  However, as the Tribunal’s power of extension is limited by section 28(5) to within six years from the date of resumption, the Tribunal has no jurisdiction to extend time for the applicant when the new or amended claim based on the 2009 model was not made by 24 June 2003.  It follows that the applicant is barred from making the intended new or amended claim based on the 2009 model and the new reports would serve no useful purpose, and accordingly leave to file the new reports should be refused.

37.  The respondent further submits that it is wrong to draw a distinction between two situations: (a) the serving of a claim or amended claim on the respondent before the respondent has made a decision on it (which is to be subject to the time limits under section 28) and (b) the claimant having commenced proceedings in the Lands Tribunal after the respondent has rejected a claim (which is not to be subject to the time limits under section 28).  Such an argument should be rejected for at least the following reasons:-

(1)   The Ordinance imposes the mandatory requirements of having all claims and amended claims to be first served on the respondent (section 27(1)(a)) and to go through the claims procedure of s. 29 which stipulates that only a rejected or unsettled claim should go to the Tribunal for adjudication.

(2)   The Ordinance also imposes the mandatory requirement that all claims and amended claims have to be served with the respondent within the appropriate period (sections 27(1)(a) and 28(1) impose the initial time limit of one year but subject to the Tribunal’s power to extend time (section 28(2)) up to the limit of 6 years imposed by section 28(5).

(3)   These are clear provisions set out in sections 28 and 29.  There can be no doubt of the legislative intent of the statutory regime.

(4)   If there were such a distinction as mentioned above, it would render (a) the time limits imposed by section 28, particularly section 28(5), on the Tribunal’s jurisdiction to extend time of service of a claim or amended claim on the respondent and (b) the requirement of starting the claim process with the service of the claim or amended claim on the respondent rather meaningless.

(5)   The applicant’s intended claim based on the 2009 model is clearly a new or amended claim within the meaning of section 28 and it should be governed by the same regime established under the provisions of that section, whether the applicant has commenced action before the Tribunal or not.

(6)   In East Gold and Busy Firm, the Court of Appeal and the Tribunal respectively considered section 28(1) applied to the applications for amendments to the claims made to the Tribunal after the commencement of compensation proceedings there and granted extensions of time to the amended claims under section 28(4).

(7)   In Busy Firm it was specifically argued by the claimant that the amendment to the claim was not governed by the equivalent of section 28 but by section 10 of the Lands Tribunal Ordinance, Cap 17 and the Tribunal rejected the argument.

(8)   Judge Lam’s ruling in Berwell Trading Ltd does not give much help to the applicant in this regard, as Judge Lam in that case did exercise the Tribunal’s power of extension of time under s. 28(4) and the passage cited was clearly obiter.  The passage was made apparently without benefit of any argument.  Further this case predated both East Gold and Busy Firm and the ratio of these two decisions are very clear: section 28 applies to an amendment made to the claim after the commencement of compensation proceedings in the Tribunal.

38.  The respondent further contends that in compliance of sections 27 and 29, each of the 4 previous new or amended claims submitted on behalf of the applicant was constituted by a compensation valuation assessment based on a development model and each particularized claim was served on the respondent and had gone through the claims procedure resulting in a rejection.  The matters relied on by the respondent are as follows:-

(1)   On 24 February 1998, the respondent invited the applicant to serve written claim pursuant to s. 27 and s. 29 of the Ordinance.

(2)   On 23 June 1998, C Y Leung & Co Ltd submitted for the applicant claim for $200,000,000 with the express statement that a valuation report would be submitted later.  The respondent asked for further particulars and on 19 August 1998, C Y Leung & Co Ltd submitted a valuation report showing a revised claim of $141,504,622 basing on a development model with a plot ratio of 3.9 and total saleable area of 6,155.21m².

(3)   After the respondent requested for further clarifications, on 11 November 1998, C Y Leung & Co Ltd provided a further valuation report revising the claim to $122,416,134.

(4)   On 16 December 1999, the respondent rejected the claim for $122,416,134 and counter-offered $26,107.254.  On 11 January 2000, the applicant only accepted provisional payment but not the counter-offer.  This signified the end of the process concerning the first claim based on the first development model.

(5)   The applicant’s claim by letter of 23 June 1998, after it was particularized, relied on the first development model.  It was not the claim and the development model which the applicant chose to take to the Tribunal.  It was the claim based on the 2003 model that was presented to the Tribunal for adjudication.

(6)   The first development model also ignored and built over the footpath and hence would have been rendered not feasible by the Tribunal’s ruling on the preliminary issue.

(7)   On 29 November 2000, DTZ Debenham Tie Leung submitted for the applicant another valuation report making a new or amended claim for $57,372,634 basing on a village-type houses development model of total gross floor area of 4,338.78 m² (obtained from  the net building site area of 1,446.26 m² after deducting the footpath). The respondent requested for particulars, which the applicant provided.

(8)   On 11 July 2001, the respondent rejected the claim for $57,372,634 and counter-offered $26,107,254.  On 3 August 2001, the applicant rejected the counter-offer.  This signified the end of the second claim based on the second development model.

(9)   On 25 November 2002, Chesterton Petty submitted for the applicant another valuation report making a new or amended claim for $39,414,254 being the higher of the two assessments based on (a) NTEH development model of total gross floor area of 4,338.6m² (obtained from net building area of 1,446.2m² after deducting the footpath); and (b) Non-NTEH development model of gross floor area of 1,026m², the existing bulk of the structures found in the Lots at the date of resumption.

(10)     After seeking particulars and not getting them, on 26 June 2003, the respondent rejected the claim for $39,414,254 and counter-offered $26,107,347.  The applicant did not accept the counter-offer.  This signified the end of the third claim based on the third development models.

(11)     On 27 October 2003, the applicant made the building enquiry submission on plot ratio and the Building Authority approved it on 5 December 2003.

(12)     On 15 January 2004, Chesterton Petty submitted for the applicant another assessment making a new or amended claim for $62,500,000 basing on the 2003 model (according to the plans approved by the Building Authority on 5 December 2003).

(13)     On 14 July 2004, the respondent rejected the claim for $62,500,000 and counter-offered $26,107,347.  On 12 October 2004, the applicant rejected the counter-offer.

(14)     The applicant issued the Notice of Application for compensation on 10 November 2005 still relying on the 2003 model but revising the claim to $79,430,000 in the 2005 & 2006 reports submitted for the purpose of the trial.

39.  The respondent submits that the parties have acted pursuant to the claims procedure under section 29 of the Ordinance and in particular:-

(1)   Each of the applicant’s new or amended claims is not just a monetary amount but is always particularized and constituted by a compensation assessment based on a definite development model;

(2)   In respect of each of the applicant’s new or amended claim, the respondent would follow the statutory procedure ending with the issuance of a rejection together with a counter-offer; and

(3)   After the non-acceptance of the counter-offer, the applicant would submit another compensation assessment making a new or amended claim based on a different development model (except for the last one based on the 2003 model in respect of which the application started the action herein).

40.  After the determination of the preliminary issue, the applicant attempts to make the intended claim for $78,606,000 in the new reports based on the 2009 model and hence the present application for leave to file the new reports. The 2009 model is different from the 2003 model in all fundamental respects in terms of the locations, orientations, numbers, types, designs, layout and dimensions of the buildings and the open space in at least the following ways:-

2003 model				2009 model
	Type of Building	No. of Unit	Gross Floor Area	Type of Building	No. of unit	Gross Floor Area
Proposed Development
	1.    One 3-storey detached apartment block	3	78.2m2 x 3 = 234.6m2	1.  Six 3-storey detached houses with individual swimming pool on roof of each houses
				House 1	1	110.220m2 x 3 = 330.660m2
				House 2	1	139.255m2 x 3 = 417.765m2
				House 3	1	111.787m2 x 3 = 335.361m2
				House 4	1	117.500m2 x 3 = 352.500m2
				House 5	1	110.046m2 x 3 = 330.138m2
				House 6	1	164.395m2 x 3 = 493.185m2
	2.    One 3-storey     4-block in-row apartment block	12	574.302m2 x 3 = 1,722.906m2	2.  One 3-storey detached apartment block with a swimming pool	3	99.475m2 x 3 = 298.425m2
	3.    Two 3-storey detached house (with light-well on 1st & 2nd Floors)	2	107.928m2 + 103.428m2 x = 314.784m2
	4.    One 3-storey semi-detached house	1	89.837m2 x 3 = 269.511m2
	Total	18	2,541.801m2	Total	9	2,558.034m2
Layout	·   Apartment blocks situated on Lot No. 288 ·   Houses situated on Lot Nos. 289 & 293			·   Apartment block situated at southern portion of Lot No. 288 ·   Houses situated on the northern & southern portion of Lot No. 288 and Lot Nos. 289 & 293
Max. Building Height	·   Apartment blocks with 8.55m ·   Houses with 9.11m			Not Available
Plot Ratio	1.256			1.264
Site Coverage	42.024%			42.143%
Open Space	635.705m2			644.691m2

41.  Thus, the respondent contends that the applicant’s intended claim for $78,606,000 based on the 2009 model is a new or amended claim within the meaning of section 28, and as the Tribunal cannot extend the period beyond 6 years such a claim is now time-barred.

42.  The respondent further contends that it is the applicant’s own choice to take risk on the footpath in the 2003 model.  A salient feature of the 2009 model is that it has (unlike the 2003 model) taken into account the right of way in the footpath and designed new buildings (which are fundamentally different from the buildings in the 2003 model) which do not build on the footpath.  The applicant (and her advisers) knew from the very beginning of the claims procedure that the respondent queried development models building over the footpath but took the deliberate decision to proceed in the Tribunal with claim based on the 2003 model (as opposed to some other models which would respect the right of way in the footpath such as the 2009 model), and by so doing the applicant must live with the consequences of the inherent risks flowing from that deliberate decision.  The respondent relies on the following matters to support the above contention:-

(1)   By way of letter dated 10 February 1999, the District Lands Office requested C Y Leung & Co Ltd to clarify the right of way in respect of the first development model as follows:-

“There was a footpath crossing the sites as shown on the resumption plan. The footpath which had long been established appeared to be by prescription a public right-of-way. Should there exist, the sites were fragmented. The development site area which in turn the development potential of the captioned sites would be affected”

 (underlines added)

(2)   On 10 March 1999, C Y Leung & Co Ltd admitted the existence of the right of way as follows:-

“We noted that there is a footpath shown on the resumption plan. The footpath is under the ownership of our client. At the date of reversion, there was a no claim for any interest on this path. Therefore, no allowance has been made for any public right-of-way.”

(underlines added)

(3)   However, DTZ Debenham Tie Leung (which is the successor of C Y Leung & Co Ltd) took into account and respected the right of way when submitting the claim for $57,372,634 based on the second development model on 29 November 2000 as follows:-

“Site Area	1,578.26
(Including the area of existing footpath):	sq.m.”
“Net Site Area	1,446.26
(After deducting area of existing footpath):	sq.m.”
(underlines added)

(4)   Chesterton Petty equally took into account and respected the right of way by adopting 1,446.26m² as the site area (net the right of way) for the NTEH development model with the higher assessed value when submitting the claim for $39,414,254 based on the third development model on 25 November 2002.

43.  From the above, the respondent submits that the applicant had made the deliberate decision of choosing to proceed to trial in her compensation proceedings on her last claim based on the 2003 model which deliberately built over the footpath.  There is nothing unfair for her to take the consequences flowing from the decision of having taken that risk.  One of the consequences is that any intended new or amended claim from her to be served after the preliminary issue ruling would be time-barred.  The applicant simply has no cogent reason to delay coming up with the 2009 model before the deadline as provided by section 28(5).

Discussion

44.  There is no dispute between the parties that section 28(1) of the Ordinance stipulates a limitation period for service of a claim or an amended claim on the respondent (as opposed to the Lands Tribunal).   The applicant, however, has made it clear that she is not seeking any extension of time in the present application, still less an extension of time to serve any claim or amended claim on the respondent.  What the applicant is seeking is the Tribunal’s leave to file and serve the new reports in support of her claim for compensation which was filed with the Lands Tribunal in 2005.

45.  Thus, section 28(1) of the Ordinance is not directly engaged in the present application unless I rule in favour of the respondent that the applicant is actually introducing a new or amended claim.  As submitted by the respondent, I need to make determination on this issue at this stage, and if not, it would also be brought up at the resumed hearing.

46.  Having considered carefully the submissions from both parties, I come to the view that the applicant is not making a new or amended claim as alleged by the respondent.  The applicant’s claim is for compensation under Item 1 of Part II of the Schedule to the Ordinance (ie resumption of land), and the amount of the claim put forward in the Notice of Application is for $200 million, which is based on C Y Leung & Co Ltd’s letter dated 23 June 1998 to the District Lands Officer.  The Notice of Application and the attachment thereto did not refer to any particular form of development.  Thus, it can include the revised proposal or the 2009 model.

47.  Prior to the filing of the Notice of Application on 10 November 2005, the amount of the claim had been revised on a number of occasions: (i) originally on 23 June 1998, $200m¸ (ii) on 19 August 1998, $142m, (iii) on 11 November 1998, $114m + $7.9m (ex-gratia allowance), (iv) on 29 November 2000, $57.4m, (v) on 25 November 2002, $39.4m, and (vi) lastly on 15 January 2004, after a building enquiry submission had been approved, $62.5m.  In each instance other than (i), the amount put forward was supported by a report or assessment by a valuer.

48.  After the commencement of the proceedings herein, the parties adduced their respective expert evidence in support of and against the applicant’s claim.  In particular, the applicant’s expert, Mr Alnwick Chan, put forward a claim for $79.43m in his report dated 16 November 2005.

49.  I agree with the applicant that the various valuation reports or assessments are merely evidence put forward by the applicant in support of her claim for compensation for resumption of the Lots.  The new reports will also serve the same purpose as part of the evidence in support of the claim first served on the respondent on 23 June 1998.  The new reports have been prepared consequent upon and in view of the Tribunal’s ruling regarding the public right of way.  Even though the evidence put forward may not fully support the amount of the claim (ie $200 million), that is a different matter altogether.  It is not unusual that the evidence put forward on behalf of a claimant may not fully match the amount of the pleaded claim.

50.  On the other hand, it is rather odd to say that in every such case, each valuation put forward by the claimant should be treated as an amended claim and the claimant is required to serve an amended claim on the respondent first when the basis and nature of the claim are still the same.  If the respondent’s arguments were right, it means that all the previous revisions on the amount of claim would have to be made within one year from the date of resumption.  This is plainly wrong. 

51.  The respondent has placed considerable emphasis on the so called different “development models”.  However, these development models are all hypothetical, and are merely models used by the valuers to derive or arrive at the true value of the lands resumed by the government.  These different development models do not amount to different “claims”, even though the quantification of the claim has changed having regard to the different hypothetical development models.

52.  Although the cases of East Gold and Busy Firm ruled that section 28(1) applies to new claims or amended claims sought to be made after the proceedings are commenced in the Lands Tribunal, they are clearly distinguishable from the present case.

53.  East Gold relates to a claim under the Ordinance where the applicant sought to change the whole basis of the claim for compensation.  The original claim was based on the use of the relevant land as a fish pond and the amount of compensation claimed was $101,300, whereas the amended claim was based on the best use of the land (ie open storage) and the amount of compensation claimed was $14.3 million.  Busy Firm relates to a claim under the Railways Ordinance, Cap 519, where the applicant sought to add a new component to the claim for compensation, namely, diminution in value of certain contiguous lots (not resumed by the government) due to severance.

54.  In both cases, it was accepted that there was an “amended claim” within the meaning of section 28(1).  The parties did not raise any question relating to the meaning of an “amended” claim or “amendment” of a claim, and there was obviously a substantial difference in terms of the nature of the “claim”.  In the present case, however, the subject matter (or components) of the applicant’s claim always remain the same.

55.  I accept that if the basis or the nature of the “new” claim is different from the original claim, then a claimant will have to serve the “new” claim on the respondent again.  In this regard, I agree with the respondent’s interpretation that there should not be a distinction between the situation where the proceedings in the Lands Tribunal have already commenced and the situation where they have not.  The Ordinance clearly does not draw such a difference.  It would also make no sense if a claimant is allowed to make a completely different claim without going through the statutory process laid down in section 29 of the Ordinance once the proceedings in the Lands Tribunal has commenced.  It would also make no sense to have the time limit imposed in section 28 of the Ordinance, if a claimant can make a completely different claim at any time after the proceedings in the Lands Tribunal have commenced.

56.  However, the above does not apply to the present situation, as there is no different claim here.  The applicant is still claiming compensation in relation to the Lots, not some other lots.  The basis and the nature of the claim are still pursuant to Item 1 of Part II of the Schedule to the Ordinance, and not some other provisions.  The mere fact that there is a different hypothetical development model used by the applicant to help the Tribunal to determine the right amount of compensation payable under Item 1 of Part II of the Schedule to the Ordinance will not change the basis or the nature of the applicant’s claim.  The respondent’s contention that the claim first submitted to the respondent is different from what the applicant is claiming now simply has no merit at all.

57.  It is also wrong for the respondent to rely on section 29(1)(f) of the Ordinance to suggest that whenever the particulars given are different from the original particulars of the claim, it will constitute a new or amended claim.  Take for example, if a claimant made a genuine arithmetical error or typing mistake in the calculation of the amount of the claim and hence set out the wrong particulars in the claim, would he be barred from making the right claim after the time limit has expired?  I would not say so in such circumstances, as the basis and nature of the claim are still the same.  Thus, it would be wrong to place such great emphasis on the particulars given. Ultimately, the question should just be whether there is a change of the basis and nature of the claim.  As discussed above, I do not consider that assessments of compensation based on different development models would amount to making different claims.

58.  In the circumstances, I find that by adducing the new reports, the applicant is not making a new or amended claim and the issue of time-barred is irrelevant in the present context.

Unfairness, waiver, estoppel and acquiescence

59.  In view of my finding above, it is not necessary for me to deal with all these contentions concerning the unfairness, waiver, estoppels and acquiescence for the respondent to raise the time-barred issue.

60.  In any event, I would agree with the respondent that the Tribunal’s power to extend time for service of a new or amended claim comes from and is defined by the Ordinance.  The Tribunal has no jurisdiction to extend time other than in accordance with s. 28(5) of the Ordinance for the service of the claim.  The respondent cannot act to confer jurisdiction by estoppel, waiver, acquiescence or even express consent (see Chiu Ming Kiang v. William Lee Shung, Civil Appeal No. 85 of 1990).  It is also a fundamental principle that a party cannot be stopped from subsequently maintaining that a court or tribunal has acted without jurisdiction (see Essex County Council v Essex Incorporated Congregational Church Union [1963] AC 808).

61.  Thus, if the applicant has made a new or amended claim as alleged by the respondent, which I do not agree, then there is still no use for the applicant to rely on all these contentions concerning the unfairness, waiver, estoppels and acquiescence for the respondent to raise the time-barred issue, as they would not confer jurisdiction on the Tribunal once the claim is time-barred.

Relevance of the new expert reports

62.  Apart from the issue of time bar, the respondent has not disputed the relevance of the new expert reports.  On the question of relevance and admissibility, the applicable test can be found in Wong Hoi Fung v American International Assurance Co (Bermuda) Ltd & Anor HCA 4576 of 2001, where Chu J (as she then was) said the following:-

“Modern judicial authorities recongnize that the court has inherent power to rule on the admissibility of expert evidence at a pre-trial stage: Woodford and Ackroyd v. Burgess [2000] CP report 79, Ko Chi Keung v. Lee Ping Yan Andrew [2001] 2 HKC 63 and Annabell Kin Yee Lee & Others v. Lee Wing Kim (May Lee) & Anor (unreported), HCA9522/1997. Where the proposed expert evidence is plainly inadmissible or irrelevant, the court ought to exercise its discretion to refuse the admission of such evidence. But where the court cannot form a clear view on the relevance of the proposed expert evidence or where it considers that the proposed evidence is clearly relevant, then it should grant leave for the evidence to be adduced at the trial: Ko Chi Keung v. Lee Ping Yan Andrew (supra), at p.67 and Annabell Kin Yee Lee & Others v. Lee Wing Kim (May Lee) & Anor (supra), at p.15.”

63.  I agree with the applicant that the new reports are clearly relevant.  The evidence of Professor Chung, an experienced building surveyor who had formerly worked for many years in the Buildings Department, is directly relevant to the feasibility or viability of the revised proposal from the point of view of compliance with the relevant statutory building requirements.  The evidence of Mr Alnwick Chan in his supplemental report provides a detailed analysis of the assessment of the open market value of the Lots on the basis of the revised proposal.  Such evidence will clearly assist the Tribunal in the determination of the compensation payable to the applicant.  Thus, I see no reason to exclude the new reports at all.

Conclusion

64.  By reasons aforesaid, I allow the applicant’s application and order as follows:-

(1)  The applicant do have leave to file and serve the Expert Report of Professor Barnabas Chung dated 5 November 2009 and the Supplemental Expert Report of Mr Alnwick Chan dated 28 December 2009 within 14 days from the date of this order.

(2)  Costs order nisi: The respondent do pay the applicant costs of the summons dated 3 September 2010 with certificate for one counsel to be taxed on High Court scale if not agreed.  If there is no further application for costs within the next 14 days, the costs order nisi shall become absolute.