THE INCORPORATED OWNERS OF MONG KOK COMMERCIAL CENTRE v. WISDOM PROFIT LTD

LDBM 4 OF 2005

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

BUILDING MANAGEMENT Application No. 4 of 2005

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J U D G M E N T

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Jurisdiction and Reliefs sought

1.  In January 2005 the Applicant initiated the present proceedings. The Notice of Application was filed by the Applicant in person apparently without the help of its legal adviser.  On the face of it one must have difficulty in understanding what was in dispute and the cause of action. The Notice of Application in the prescribed form, Form 29, apart from filling in the addresses of the parties, the only words the Applicant filled in are in the space reserved for relief applied for. They are: “ a) Paragraph 3---the ownership of the air-condition plant room on upper roof level and b) paragraph 6 and 7-whether the extent of roof ownership includes the parapets.”  One must have difficulty in understanding what is in dispute and the cause of action. Looking at the Notice of Application, no one can guess what “paragraphs 3, 6 and 7 are referring to or what documents these paragraphs refer to.”  This case came up for call-over hearing on 16 February 2005.  The Respondent complained about the inadequacy of the matters pleaded and which complaint did not find favour with H. H. Judge K Y Chan who simply advised them to set out its case in the Notice of Opposition.  In the mean time the learned Judge extended the time for the Respondent to file the Notice of opposition.     Looking at the matters pleaded in the Notice of Opposition one can guess what is in dispute. Despite that the nature of relief sought by the Applicant is not clearly spelt out, the solicitors acting for the Applicant did not see fit to amend the Notice of Application to set out the specific relief.   At the end of the submissions by parties, I was still at a loss of what the specific reliefs the Applicant was seeking.  If they were merely declarations of title, it might give rise to the question of jurisdiction.  I proposed that parties should work out the terms of the reliefs so that they were within the jurisdiction of the Tribunal to determine.  Otherwise, parties should address me on the jurisdiction point.  Parties failed to work out the terms of such reliefs. Instead, the Applicant submitted the specific terms of declaratory reliefs and the Respondent argued that the Tribunal had no jurisdiction to grant such reliefs.  Incidentally, the Respondent asked for the transfer of the present proceedings to the High Court.

2.  It is too late to make a transfer in view of the history of the proceedings.  If the Applicant has set out the reliefs in clear terms earlier, and the Respondent made the Application for transfer promptly, I would have transferred the case to the High Court.  It would have been in the interests of justice to do so irrespective of my view on jurisdiction.  Now that the parties have concluded their evidence and submissions, it would not serve any useful purpose to transfer the case to the High Court.  The balance of convenience dictates the obvious and appropriate course.  I should determine the jurisdiction point and the merit of the case.  Therefore I refuse the Respondent’s application for transfer to the High Court.    

3.  The reliefs the Applicant is now seeking are two declarations:

(i)	A declaration that, upon the true construction of the Deed of Mutual Covenant Memorial No. 1053473 of the Building, that is to say Mong Kok Commercial Centre, the room know as the air-condition plant room situated above the roof referred to in the said Deed of Mutual Covenant as the Roof above 22nd Floor (excluding those portions for common use) do form parts of the common parts of the said Building;
(ii)	A declaration that, upon the true construction of the Deed of Mutual Covenant No. 1053473 of the Building, that is to say Mong Kok Commercial Centre, the parapet walls on the roof referred to in (excluding those portions for common use) do form parts of the common parts and / or the external walls of the Building

4.  The Respondent claims that it has title to the parapet walls and the air-condition plant room, and therefore it have the right to the use and enjoyment of them to the exclusion of the other owners (subject to the easements etc. as provided in the Deed of Mutual Covenant).  Ms Wu, counsel for the Respondent, submits only one point.  She argues that granting the declarations will have the effect of rendering void, negativing or substantially varying in whole or in part any contractual or proprietary right enjoyed by the Respondent.  Hence, she argues, this tribunal has no jurisdiction to grant the declarations by virtue of section 45(3) of the Building Management Ordinance Cap 344 (“the Ordinance”). Section 45(3) of the Ordinance provides that:

“Subject to the provisions of this Ordinance, nothing in this section or the Tenth Schedule shall be construed to vest in the tribunal any jurisdiction other than civil jurisdiction or any jurisdiction to make any order which would, if made, have the effect of rendering void, negativing or substantially varying in whole or in part any contractual or proprietary right enjoyed by any owner or occupier or otherwise referred to in the terms and provisions of an instrument which is registered in the Land Registry including a deed of mutual covenant (if any)”

With respect to Ms Wu, she misconceives the meaning of jurisdiction currently in dispute.  The Applicant is not seeking an order which has the effect envisaged in section 45(3).  Like the Respondent, the Applicant is contending that it has the title to the air-condition plant room and the parapet walls.  Both parties rely on the true construction of various title deeds and relating documents. This Tribunal is merely asked to make declarations with respect to these title documents and is not asked to change, or vary any rights of the parties.  If the declarations are to such effect, they Tribunal should not grant them.  It would be a determination on the merit. Furthermore I would have thought that Section 45(3) equally applies to proceedings in the High Court in this matter.  In any event it is not the Respondent’s contention that the High Court’s jurisdiction or power is not subject to Section 45 (3). I find no merit in the argument of the Respondent on this jurisdiction point.

5.  This Tribunal has no general jurisdiction to grant reliefs in the nature of declaration of title.  On the other hand this Tribunal has jurisdiction to grant reliefs, legal or equitable, in the exercise of its jurisdiction (see section 8(9) of the Lands Tribunal Ordinance).  It is trite law that the two Ordinances together have the effect of conferring jurisdiction on this Tribunal to determine every conceivable dispute in the building management affairs.  In the instant case the dispute relates to the enforcement of the deed of mutual covenant, and to the use and enjoyment of common parts. The particular feature of this case is this.  If the title to the alleged common parts is clear there would have been no dispute.  Therefore the root of dispute is the title to these premises.  Be that as it may, the dispute is one that is covered by paragraphs 2, 3 and 7 of the Ordinance. In the exercise of this jurisdiction, this Tribunal by virtue of the jurisdiction conferred upon it by Section 8(9) of the Lands Tribunal Ordinance can grant the declaratory reliefs being sought by the Applicant. 

Evidence of Surveyors

6.  The parties’ expert surveyors attempt to assist the Tribunal on the interpretation of the wording in various documents.  The main dispute in this respect centred on what premises should be included in the word “roof”.  Their evidence in this respect is hardly of any assistance.  It has been clarified that this word “roof” does not have any special meaning in the field of conveyance, or in the profession of surveyors.  Neither party contends that this word “roof” has a special meaning in any custom or trade.  An ordinary meaning should be attached to it and its ambit should be interpreted in the light of the title deeds and other relevant documents.  As a result the personal opinion of the surveyor as to meaning of the word “roof” is irrelevant.  The meaning of this word in the context has to be determined by the Tribunal and by the Tribunal alone.  Having said, I have to point out that the evidence of the experts with regard to site measurements, the meaning of various sketches and layout plans, and what they purported to represent in relation to the actual site is relevant and is of assistance.   Similarly for parapet walls, it is for Tribunal alone to decide whether they are common parts within the meaning of title deeds and the Ordinance.   Again the evidence of the expert surveyors is useful in far as it falls within the ambit of their expertise.  

History of Assignments/Derivation of Respondent’s title

7.  The Respondent’s alleged title to the air-condition plant room and the parapet walls can be traced back to the Deed of Mutual Covenant which came into being when the developer (the First Owner) sold off part of building for the first time.  Subsequent sale of other part or units of building was also subject to the Deed of Mutual Covenant. Parties disputed the true construction of the following clauses:

1.	The First Owner shall ---the full and exclusive right and privileges to hold use occupy and enjoy to the exclusion of the Second Owner---the said roof and the external wall ---
3(b)	The First Owner or its successors or assigns shall have the right to use the said roof above the 22nd floor of the said building---
4	Each or more undivided 1,400 share or shares in the premises and building and the full and exclusive right and privilege to hold use occupy and enjoy each unit --- or the said roof --- shall be held --- subject to and with the benefit of the easements, rights, privileges, obligations, covenants, terms and conditions set out in this deed.
5(a)	Subject as hereinbefore mentioned, every owner for the time being of any undivided shares in the said premises and building in common with the others of them and all others having the like right shall have the right to use for all purposes connected with the proper use and enjoyment of the unit owned by him the entrance lobbies, staircases, passages, landings, transformer room, switch room, machine rooms, pump and pump houses water tanks lavatories and other facilities (if any) for common use.

The air-condition plant room had been used for the exact purpose as its name suggests until the modification of the air-conditioning system after 1977. On or about 9 November 1976 the First Owner assigned the roof and external walls to another.  This assignment took place before the modification. 

8.  The property to be assigned is defined by the following provision in the Assignment:

“All Those 25 equal undivided 1400^th parts or shares --- Together with the sole and exclusive right and privilege to hold use occupy and enjoy First All that the Roof above the Twenty Second Floor as shown coloured Pink and Pink hatched Yellow on the said Plan and thereon marked “Roof Plan” excluding those portions thereof as shown coloured Pink hatched Yellow on the said plan for common use of the said building---

For some reasons unknown the plan with parts patched in Pink and Yellow as referred to in the Assignment has not been registered.  It is not produced at this trial or to the experts for their consideration.  Instead of this plan, parties can only make use of a plan registered with the Assignment and the other building plans.  Nothing turns on the subsequent chain of assignments through which the Respondent acquires its title.  The respective case of the party stands or falls by the correct interpretation of the above provisions.

Air-condition plant room

9.  At the time of where there were only two owners, the First Owner and, the Second Owner or its assigns, the air-condition plant room is the private property of the First Owner.  It was not a common part of the building within the meaning of the DMC and section 2 of the Ordinance.    In any event Section 2 cannot be invoked to change the title or it would be caught by Section 45(3).  Perhaps this is the real concern of the Respondent when it raises the jurisdiction point.

10.  Quite some time was spent on the history of the use of the air-condition plant room.  The extent of dispute is limited and I accept the Applicant’s version.  The above two documents contain no specific reference to the air-conditioning plant room.  The Respondent contends that roof above 22^nd floor should include everything on the roof. Ms Wu argues the term “machine rooms” in clause 5(a) of the Deed of Mutual Covenant means and only means the Lift Machine Room shown in one of the building plans. The Applicant’s contention is to the contrary.  The building plan in question is entitled Machine Room Plan. On this plan a Lift Machine Room is specifically marked out and so is the disputed air-conditioning room. It is common ground that this plan can be used in aid of interpretation of the Deed of Mutual Covenant.  Counsels have not drawn my attention to the fact that Clause 5(a) refers to machine rooms and not just one machine room as submitted by Ms Wu for the Respondent.  That being the case, I find her argument, to quote: “ ‘Machine room’ refers actually to the lift machine room.” weakened.  The term “machine rooms” should be given an ordinary meaning. It means rooms which are intended to house machines.  Two such rooms are identified on the plan. One is the lift machine room and the other air-condition plant room.  The conclusion I draw is that the air-condition room is one of the machine rooms refereed to in Clause 5(a).  I would have come to the same conclusion without the aid of the Machine Room Plan.

11.  When the First Owner assigned its rights to the purchaser in 1976, the assignment was subject to the Deed of Mutual Covenant.  Apart from it is clear from the provision in the Assignment that such portion as in common use is to be excluded.  There cannot be any dispute that the air-condition plant room was at the time and had been in common use.  My finding is that the air-condition plant room is thereby excluded even if it is not one of the machine rooms provided in the Deed of Mutual Covenant.

Parapet Walls

12.   The parapet walls are within the boundary of the roof in the Assignment.  This is clear from the measurements and the conventional pictorial representation of the plan.  There is no dispute between the experts in this respect.  Mr. Soo argues that these walls form part of the external walls all of which have been assigned to the Applicant.  If these parapet walls indeed form part of the external walls, the First Owner in 1976 must have been taken to have assigned them to the purchaser. It is not open to a stranger to the Assignment to impute a mistake or intention which is not apparent on the Assignment.  The Assignment itself is clear that the parapet walls have been conveyed to the purchaser. 

Orders

13.  I will make the declaration sought in respect of the air-condition room and refuse to make the other.  The Applicant only succeeds in part in these proceedings. I am of the view that the proper order for costs is no order as to costs and I so order.   This order nisi for costs be made absolute in 6 weeks.