MUNG CHI FAI AND ANOTHER v. TAT FUNG ENTERPRISES CO LTD

HCA 2357/2014

[2021] HKCFI 347

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2357 OF 2014

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J U D G M E N T

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A. Introduction

1.  This is the claim by Mr Mung Chi Fai (蒙賜輝, “Mr Mung”) and his wife Madam Au Yeung Wai Yee (歐陽慧兒, “Mrs Mung”, and together with Mr Mung collectively “Ps”) against the defendant company (“Tat Fung”) for possessory title over certain pieces of land (the “Claimed Areas”).  Ps rely on the doctrine of adverse possession. Tat Fung has not put forward any positive defence, but put Ps to strict proof of their case.  The main issues are whether Ps can establish factual possession over the Claimed Areas with the requisite intention.

2.  Mr Chase Pun appeared for Ps.  Mr Foster Yim appeared for Tat Fung.

B.  The parties

3.  Ps are husband and wife.  They have been married since 1961.  

4.  Mr Mung is now 85 years of age, and Mrs Mung 79.  They have a son called Mr Mung Chin Hung Patrick (the “Patrick Mung”).

5.  Tat Fung is a limited company.  One of its directors is Mr Derek Chiu. 

C.  The Claimed Areas

6.  I annex to this Judgment as Annex A a copy of the agreed Identification Plan in colour (the “Identification Plan”).  Its accuracy for identification purposes has been agreed by the parties and the experts engaged respectively by them.  It forms part of the agreed documents.

7.  Material to the claim are Lot 698 (“Lot 698”), Lot 1193 (“Lot 1193”) and the Remaining Portion of Lot 1193 (“Lot 1193RP”) all within Demarcation District 453 (“DD 453”), Lo Wai Village, Tsuen Wan.

8.  In so far as Lot 1193 and Lot 1193RP are concerned:

(a)  Lot 1193 was originally a single piece of land granted under New Grant No 2719.  The original lease term commenced on 1 July 1889;

(b)  By a conveyance on sale dated 27 July 1964, Mr Deacon T K Chiu became the registered owner of Lot 1193;

(c)  On 6 February 1971, Mr Deacon T K Chiu assigned to Tat Fung a number of pieces of land.  One of them was Lot 1193;

(d)  By Notice of Resumption dated 24 March 1988 (registered by Memorial TW502462)[1], a portion of Lot 1193 (carved out as Section A) was resumed by the Government.  Lot 1193A is a narrow stretch of land.  The balance of Lot 1193 has upon resumption become Lot 1193RP;

(e)  Tat Fung has since remained the registered owner of Lot 1193RP.

9.  In so far as Lot 698 is concerned:

(a)  Lot 698 was originally an Old Schedule Lot held under a Block Government Lease. 

(b)  On 4 March 1963, Mrs Mung became the registered owner of Lot 698;

(c)  Lot 698 has at different stages been given the house number of 76E and 164;

(d)  On 26 November 1973, Lot 698 was subdivided into Section A (“Lot 698A”) and the Remaining Portion (“Lot 698RP”), and Lot 698A was assigned by Mrs Mung to one Hui Kam Shing;

(e)  On 20 February 1982, Mrs Mung assigned Lot 698RP to one Ho Chui Sim.  On 12 June 1985, Ho Chui Sim assigned it to Mr Mung. Mr Mung has since then been the registered owner of Lot 698RP.

10.  In so far as the Claimed Areas are concerned:

(a)  It is Ps’ claim that despite the change in ownership, they have always been in occupation and possession of the entirety of Lots 698A and 698RP. Lots 698A and 698RP are identified as and coloured blue in the Identification Plan;

(b)  It is further Ps’ claim that they have in addition also been in occupation and possession of portions of Lot 1193RP.  Those portions are identified as and coloured pink in the Identification Plan;

(c)  Those portions of Lot 1193RP identified as and coloured pink in the Identification Plan are the Claimed Areas;

(d)  The Claimed Areas are not the entirety of Lot 1193RP;

(e)  As can be seen from the Identification Plan, the Claimed Areas comprise 2 portions.  I call them the Northern Claimed Area and the Southern Claimed Area according to their respective geographic positions.  They are separated by Lot 1193A (ie the narrow stretch of land that has previously been resumed by the Government);

(f)  The Southern Claimed Area adjoins (1) the northern and eastern boundaries of Lot 698RP, and (2) the eastern boundary of Lot 698A (as shown on the Identification Plan).

D.  Parties’ pleaded cases

D.1.  The Amended Statement of Claim

11.  The Writ herein was issued on 19 November 2014.  The Statement of Claim was first filed on that same date.  It has been amended once, following a course of events as follows.

12.  The Pre-trial Review (“PTR”) of the trial took place before me on 10 October 2019.  On that occasion, I reminded parties of the importance of having an agreed identification or location plan.  As part of the directions I gave, I directed that the parties do use the best endeavor to reach agreement on inter alia a coloured location plan (with legends) showing all the relevant lots, roads and constructions, and that the exact delineation of the areas which Ps are claiming possessory title of should in particular be clearly marked.

13.  There was no indication during the PTR that Ps intended to seek any amendment to their Statement of Claim.

14.  Then, on 7 November 2019, Ps took out a Summons returnable before me on 20 December 2019 seeking leave to amend the Statement of Claim and to file a further statement of Mr Mung.

15.  In the course of that application, Mr Pun informed me that there was in fact no need for Ps to make the amendments, and that the application was merely made to make their case clearer.

16.  On that basis, and given the lateness of the application, I refused the application.

17.  Then on the morning of the first day of the trial, Mr Pun again sought leave to amend the Statement of Claim.  In the end, and after argument, Mr Pun withdrew some of the proposed amendments, and in the absence of objections from Mr Yim in respect of certain others, I granted Ps leave to effect most of them.  The Amended Statement of Claim (“ASOC”) was formally filed on 7 January 2020.

18.  In respect of the ASOC:

(a)  A plan (the “Plan”) is attached thereto[2] showing the location of the relevant land and a brick house (the “Brick House”).  A copy of the Plan is annexed to this Judgment as Annex B.  The Brick House is coloured yellow thereon;

(b)  The material paragraphs of the ASOC are as follows:

“ 5.  [Mr Mung] caused to be constructed and erected, among other things, [the Brick House] consisting of a gross area of approx. 666 sq. ft. or thereabout … on [Lot 1193RP] and [Lot 698] as shown in ‘T’ shape in the Plan and thereon coloured Yellow (for reference purpose only) in or about 1963, it being some time after the typhoon ‘Wanda’ in August/September 1962, for residential purpose, which said Brick House was erected on such part or portion of and within [Lot 1193RP] and [Lot 698] and was then known as ‘No. 76E Lo Wai Village, Tsuen Wan, New Territories’, but was later re-designated and identified by the District Office, Tsuen Wan…as ‘No. 164 Lo Wai Village’ aforesaid.

6.  For years long before erection of the Brick House and the [Tat Fung’s] acquisition of [Lot 1193RP] on or about 6^th February 1971, possession thereof was already wholly held and occupied by one LAI Tam Yun (賴譚潤) (‘Mr Lai’), who had then been living and cultivating on the Claimed Areas for agricultural purposes. Thus, the Claimed Areas has since been, and is still at the date hereof, encroached by [Ps] when the Brick House was constructed and erected but without any objection whatsoever from Mr Lai and/or [Tat Fung] whomsoever subsequently.

7.  By the Memorandum of Sale written in Chinese made and signed by Mr Lai as seller and [Mrs Mung] as buyer and dated 13^th April 1979 (‘the Memorandum of Sale’), Mr Lai then as the person in possession and occupation of the Claimed Areas sold and assigned all his rights of way and agriculture thereto to [Mrs Mung]…

8.  [Mr Mung], whilst living at the Brick House and [Lot 1193RP] and [Lot 698] and running business of plastic toys thereat under the respective styles or firm names of ‘Tai Sing Manufacture Fty’ and ‘Tat Sing Engine Model Fty’, has caused, among other things, the Claimed Areas to be rounded up and enclosed with iron fences after all the rights thereto were sold and assigned to [Mrs Mung] from Mr Lai. Thereafter, [Ps] irrigated and cultivated the Claimed Areas for plantation of fruits and flowers thereat when [Mr Mung’s] business aforesaid was wound up and ceased.

9.  Thus, and as far as the Claimed Areas is concerned, [Ps] have at all material times since April 1979 aforesaid been occupying and holding possession thereof for irrigating and cultivating fruits and flowers thereon, and have been making use of the stream water therefrom for the irrigation and cultivation before the installation and erection of water supply…

10.  In the circumstances, and notwithstanding [Tat Fung’s] acquisition of [Lot 1193RP] on or about 6^th February 1971, [Tat Fung] has been dispossessed of the Claimed Areas for the period of 20 years, or alternatively 12 years, immediately before the commencement of this Action whilst the [Ps] having at all material times continuously in exclusive possession thereof…

11.  In the premises, [Ps] have been in adverse possession of the Claimed Areas for a period of over 20 years, or alternatively 12 years, next before commencement of this Action, and any action by or on behalf of [Tat Fung] has been barred under and by virtue of Section 7 of the Limitation Ordinance, Cap 347…”

D.2.  The Defence and Counterclaim

19.  Consequential upon Ps’ amendment of the Statement of Claim, Tat Fung filed on 9 January 2020 its Amended Defence and Counterclaim.

20.  As I have mentioned above, no positive defence has been pleaded by Tat Fung.  Ps are put to strict proof of their case.

21.  Tat Fung counterclaims for possession of the Claimed Areas, an injunction to restrain further trespass, and damages / mesne profits for unlawful occupation.  The Counterclaim is based upon Tat Fung’s registered title to the Claimed Areas.

E.  The issues

22.  The issues, as set out in the List of Issues agreed by the parties, are:

“ 1.  Have [Ps] been in exclusive possession, occupation and control of the Claim Areas of the Lot as a matter of fact with the requisite animus possidendi for a period sufficiently long enough to bar [Tat Fung] from recovering the same?

(1)  Have [Ps] been living at Lo Wai Village, Tsuen Wan New Territoties since February 1961?

(2)  [Was] the Claimed Area[s] or any party thereof rounded up and enclosed with iron fences and/or other materials after April 1979?

(3)  Did [Ps] at the material times irrigate and cultivate the Claimed Areas for plantation of fruits and flowers thereat?

2.  If [Ps] succeed, what are the exact location, boundary and area of the Claimed Area [sic]?

3.  If [Tat Fung] succeeds, are they entitled to claim damages against [Ps], and if so, how much?”

F.  The witnesses

F.1.  The factual witnesses

23.  Mr Mung and Mrs Mung gave evidence during the trial.

24.  Mr Mung has given two witness statements.  The main one is dated 14 February 2018 (“Mr Mung WS#1”).  The other one merely corrects a mistake in Mr Mung WS#1.  It has little consequence.

25.  He adopted both his statements as his evidence-in-chief.

26.  Mr Yim did not cross-examine Mr Mung.  No contrary case has been put to him.  The effect is that Mr Mung’s credibility and reliability as a witness have not been challenged.  Mr Yim accepted that at the beginning of his oral closing submissions.

27.  Mrs Mung has for the purpose of this Action filed one witness statement (“Mrs Mung WS”).  She adopted her statement as her evidence-in-chief.

28.  Again, Mr Yim did not cross-examine Mrs Mung.  No contrary case has been put to her.  The effect again is that Mrs Mung’s credibility and reliability as a witness have not been challenged.  Mr Yim similarly accepted that in the course of his oral closing submissions.

29.  Relevant to Mrs Mung WS I record one matter:

(a)  In Mrs Mung WS, Mrs Mung refers to a witness statement she previously gave in an earlier High Court Action (“HCA 915/2011”) in which she appeared as a witness.  She produces a copy of that previous statement to corroborate her evidence given in the present trial;

(b)  Mr Yim objected to that course being adopted;

(c)  The contents of the previous statement are materially the same as those of Mrs Mung WS.  They have no additional evidential value.  This is particularly so given Mrs Mung’s credibility and reliability as a witness are not being challenged by Mr Yim;

(d)  I place no weight upon the contents of the previous statement.

30.  For Tat Fung, Mr Derek Chiu gave evidence during the trial.  He has been a director of Tat Fung.  He otherwise has no knowledge about the underlying facts.  His evidence is of no consequence.

31.  I have considered the evidence of Ps.  I do not detect any material inherent improbability or inconsistency, whether internal or external, amongst their evidence.  I note further that their credibility and reliability as witnesses have not been challenged, and no contrary case has been put to them. I find both of them to be honest and reliable witnesses.

F.2.  The expert witnesses

32.  Ps has engaged Mr Leung Chi Yan George (“Mr Leung”), who is a land surveyor.

33.  Mr Leung’s Report is dated 30 October 2017 (“Leung’s Report”). A substantial number of aerial photographs and survey sheets have been studied, interpreted and explained in the report.  Mr Leung has been called as a witness and cross-examined.

34.  Tat Fung has engaged Mr Wong Yiu Cho Joseph (“Mr Wong”), also a land surveyor.

35.  Mr Wong’s Report is dated 15 February 2018 (“Wong’s Report”). He has also studied and interpreted essentially the same aerial photographs and survey sheets which Mr Leung had.  Mr Wong has also been called and cross-examined.

36.  Mr Leung and Mr Wong have met and produced a Joint Statement (the “Joint Expert Statement”).  It is dated 28 May 2018.  The experts are essentially in agreement in terms of their views and findings.  As the experts have stated in the Joint Statement:

“ A.5.  Observations on the aerial photos

Generally, we agreed that our observations are very much the same as to be listed in the following paragraphs 7 and 8. Where we differ, we would present our different opinions with reasons under ‘issues not reaching an agreement’ in paragraph B.

…

A.8.  Observations on the survey sheets

Generally, we agreed that our observations are very much the same as to be listed in the following paragraph 8.1. Where we differ, we would present our different opinions with reasons under ‘issues that we are not in agreement’ in paragraph B.

B.  Issues that we are not in agreement (with individual reasons stated)

Nil.”

37.  Relevant to the evidence given by the experts I record one matter:

(a)  Amongst the hearing bundles as Items 57 and 58[3] are two orders made in two earlier legal actions against inter alios Tat Fung.  Those actions also related to Lot 1193RP;

(b)  Mr Yim objected to their inclusion as being irrelevant;

(c)  Mr Pun sought to justify their inclusion by submitting that they may give this Court a full picture on Lot 1193RP;

(d)  I am concerned in this action with the agreed issues before me.  I am not concerned with any unspecified full picture relating to Lot 1193RP;

(e)  Mr Pun then submitted that they may be relevant to the boundary of the Claimed Areas;

(f)  But the boundary of the Claimed Areas have been considered by the experts, and have been set out in the Identification Plan.  Those earlier orders serve no useful purpose in that regard;

(g)  I note that Mr Wong when giving evidence has referred to those Orders to the extent of showing that he had surveyed Lot 1193RP before. Save for that purpose, I place no weight on those two Orders.

38.  I find both experts to be honest witnesses who has given evidence professionally and to the best of their professional abilities.  I accept their joint opinions expressed in the Joint Expert Statement.

G.  The law on adverse possession

39.  The legal principles relevant to adverse possession have been mostly settled.  I record the relevant principles below essentially for the purpose of reflecting what the parties have highlighted to me in the context of the present action.

40.  The starting point is the Limitation Ordinance, Cap 347.  The following sections are relevant:

“ 7(2)  No action shall be brought by any other person to recover any land after the expiration of 12 years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person…

…

8(1)  Where the person bringing an action to recover land, or some person through whom he claims, has been in possession thereof, and has while entitled thereto been dispossessed or discontinued his possession, the right of action shall be deemed to have accrued on the date of the dispossession or discontinuance.

…

13(1)  No right of action to recover land shall be deemed to accrue unless the land is in the possession of some person in whose favour the period of limitation can run (hereafter in this section referred to as adverse possession) and where under the foregoing provisions of this Ordinance any such right of action is deemed to accrue on a certain date and no person is in adverse possession on that date, the right of action shall not be deemed to accrue unless and until adverse possession is taken of the land.

…

17.  Subject to the provisions of section 10, at the expiration of the period prescribed by this Ordinance for any person to bring an action to recover land (including a redemption action), the title of that person to the land shall be extinguished.”

41.  The period prescribed by section 7(2) was amended from 20 years to 12 in 1991 via the Limitation (Amendment) Ordinance 1991.  Section 38A(1) of the Limitation Ordinance sets out certain transitional provisions which are relevant to that amendment, that:

“ (1)  The time for bringing proceedings in respect of a cause of action—

(a)  to recover any land;

…

which accrued before 1 July 1991 shall, if it has not then already expired, expire at the time when it would have expired apart from the provisions of the Limitation (Amendment) Ordinance 1991.”

Hence, in respect of any cause of action which had accrued before 1 July 1991, the old limitation period of 20 years remains applicable despite the amendment.

42.  In Incorporated Owners of San Po Kong Mansion v Shine Empire Ltd (2007) 10 HKCFAR 588, Nazareth NPJ explained at §7 that:

“ 7. The principles for the application of ss. 7(2), 17 and the associated provisions of the Limitation Ordinance are well settled. They were formulated and set out by Slade J in Powell v McFarlane (1979) 38 P & CR 452, approved by the House of Lords in JA Pye (Oxford) Ltd v Graham [2003] 1 AC 419, and adopted by this Court in Wong Tak Yue v Kung Kwok Wai (1997-98) 1 HKCFAR 55… The authorities mentioned, not only approve those principles, but provide explanation of them and guidance in their application. Of particular relevance to dispossession are the following passages in Slade J’s judgment in Powell v McFarlane:

…

(2) If the law is to attribute possession of land to a person who can establish no paper title to possession, he must be shown to have both factual possession and the requisite intention to possess (animus possidendi ).

(3) Factual possession signifies an appropriate degree of physical control. It must be a single and conclusive possession, though there can be a single possession exercised by or on behalf of several persons jointly. Thus an owner of land and a person intruding on that land without his consent cannot both be in possession of the land at the same time. The question what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances … acts of possession done on parts of land to which a possessory title is sought may be evidence of possession of the whole. Whether or not acts of possession done on parts of an area establish title to the whole area must, however, be a matter of degree … is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no-one else has done so.

(4) … the animus possidendi involves the intention, in one's own name and on one's own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the processes of the law will allow.

…

An owner or other person with the right to possession of land will be readily assumed to have the requisite intention to possess, unless the contrary is clearly proved.  This is why the slightest acts done by or on behalf of an owner in possession will be found to negative discontinuance of possession.  The position, however, is quite different from a case where the question is whether a trespasser has acquired possession.  In such a situation the courts will require clear and affirmative evidence that the trespasser, claiming that he has acquired possession, not only had the requisite intention to possess, but made such intention clear to the world.  If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi and consequently as not having dispossessed the owner. (pp.470-472.)”

43.  I also refer to Lam Sai Wan v Minloy Limited [2018] HKCFI 1710, where Deputy Judge Saunders at §§27 to 37 gave a very useful summary of some of the principles and considerations relevant to the doctrine of adverse possession.  Of particular relevance to this case are §§32 to 34 thereof, that:

“ 32.  The formulation of the concept of animus possidendi by Slade J in Powell (see (4) quoted in §26 above) was approved by the House of Lords in JA Pye (Oxford) Ltd v Graham [2002] UKHL 30, [2002] 3 WLR 221. That case makes it clear that the requirement to exercise exclusive control of the land does not include a requirement for a conscious intention to own the land. Rather, the intention that must be established is to possess, and not to disposes the land: see Adverse Possession, Jourdan & Radley-Gardner, 2^nd Edn, 9 – 11.

33.  In Pye, at §71 Lord Hope of Craighead described the required intention this way:

‘ The important point for present purposes is that it is not necessary to show that there was a deliberate intention to exclude the paper owner or the registered proprietor. The word ‘adverse’ in the context of section 15(1) of the Limitation Act 1980 does not carry this implication. The only intention which has to be demonstrated is the intention to occupy and use the land is one’s own. …. So I would hold that, if the evidence shows that the person was using the land in the way one would expect him to use it if he were the true owner, that is enough.’

34.  A similar statement was made by Lord Hutton at §§75 – 76:

‘ 75  In the present case from August 1984 onwards the Grahams made full use of the disputed land as if they were the owners—they did everything which an owner of the land would have done and when an experienced chartered surveyor, called on behalf of the plaintiffs, was asked in cross-examination what an occupying owner of the disputed land might have done over and above what was done by the Grahams between 1984 and 1997, he was unable to think of anything.

76  I consider that such use of land by a person who is occupying it will normally make it clear that he has the requisite intention to possess and that such conduct should be viewed by a court as establishing that intention, unless the claimant with the paper title can adduce other evidence which points to a contrary conclusion.’ ”

44.  Mr Yim raised for my attention, Tsang Foo Keung & Anor v Chu Jim Mi Jimmy [2017] 3 HKC 527, where:

(a)  Cheung JA, having considered those same pages from Pye cited above, observed that:

“ 2.6.  The situation is, however, different where there is evidence pointing to a contrary conclusion or the acts of the person who claimed possession are equivocal and capable of more than one interpretation, in such a case the intention to possess is not established. As Slade J in Powell stated at p 472:

‘ If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi and consequently as not having dispossessed the owner.’

2.7.  This is reaffirmed by Lord Hutton at para 76 :

‘ It is in cases where the acts in relation to the land of a person claiming title by adverse possession are equivocal and are open to more than one interpretation that those acts will be insufficient to establish the intention to possess.’ ”

(b)  Harris J, citing Wu Yee Pak v Un Fong Leung & Other (2004) 7 HKCFAR 498 at §5, observed at §22(4) that;

“ The person claiming adverse possession has the burden of proving both exclusive physical control and the requisite intention. Although the standard of proof is still the normal civil standard, ie on the balance of probabilities, commensurate with the serious consequences of finding that the holder of the paper title has been disposed the evidence of exclusive possession and intention must be compelling. It cannot be lightly assumed that the paper title holder has foregone his interest in land.”

45.  In Yu Siu Cheuk v Realray Investments Ltd, unrep, CACV 181/2009 (10 November 2009), Cheung JA observed at §17 that:

“ … For the purpose of deciding whether the defendant’s title has been defeated by limitation the Court does not need to decide the precise point of time when the plaintiff entered the property so long as it is satisfied that the plaintiff has proved that he has been there for twenty years with the necessary intention to possess.”

46.  To prove adverse possession, enclosure is the strongest possible evidence, but it is not indispensable — Seddon v Smith (1877) 36 LT 168, per Cockburn CJ at 169, and Powell v McFarlane (1979) 38 P & CR 452, per Slade J at 477-478.

47.  I will apply the above principles and considerations to my findings based on the evidence.

H.  The issues

48.  On top of the overall issue as to whether Ps can establish exclusive possession with the requisite animus possidendi for the requisite period, parties have identified 3 specific questions relevant to liability.  I will consider those specific questions first.

H.1.  Question 1(1) — “Have [Ps] been living at Lo Wai Village, Tsuen Wan New Territoties since February 1961?”

49.  By a Certificate of Residence signed by the Village Representative of Lo Wai Village[4], Ps are certified to have been living at No 164 of Lo Wai Village since February1961.

50.  A hearsay notice dated 18 July 2017[5] has been filed covering inter alia that certificate.

51.  According to Mr Mung WS#1[6] and Mrs Mung WS[7], they had by 1963 already been living in the house at No 164, and in 1963, Mrs Mung purchased that house together with Lot 698 on which it situate.

52.  On the evidence before me, I find that Ps have been living at No 164 of Lo Wai Village since February 1961.

H.2.  Question 1(2) — “[Was] the Claimed Areas or any party thereof have been rounded up and enclosed with iron fences and/or other materials after April 1979?”

53.  According to §§6, 7 and 9 of Mr Mung WS#1:

「 6.  遠於被告公司購入該地段前，該地段已被賴譚潤的父親賴源佔用，用作耕種用途。賴源於1979年死後，其子賴譚潤接手繼續霸佔和耕種，後於同年四月他以港幣7,500[8]元將該地段轉讓予我太太；自此至今，我等已侵佔該地段逾20多年。現呈上該轉讓合約的影本…

7.  我太太同我除在698地段和該地段所答 [sic. 搭]建的石屋居住外，亦曾以Tat Sing Manufacture Fty之名稱在698地段和該地段經營塑膠玩具和不同種類的商品；當賴譚潤將該地段轉讓予我太太後，我兩便將該地段用鐵絲網作圍牆圍起，跟外邊相隔。當我結束上述生意後，我便在該地段耕種，種植鮮花和水果。

…

9.  再者，在該地段的北端也早已被我等所建的圍欄及閘門封鎖 …,只供我太太同我及家人(及在未退休前我倆所聘用的廠房工人) 進出，我倆從來沒有讓任何人從這閘門進出該地段 …」

54.  Mrs Mung’s evidence is to similar effects, that she and Mr Mung fenced off the Claimed Areas with iron mesh and gate in stages[9], and that the northern part of Lot 1193RP had also been fenced off with fences and gates[10].

55.  The agreement between Mr Lai and Mrs Mung has been produced[11]. It is dated 13 April 1979.  It says that Mr Lai sold to Mrs Mung the cultivation right in Lot 1193 at HK$4,500.  That agreement is also covered by the hearsay notice mentioned above.

56.  Before considering the aerial photographs and the survey sheets concerning the issue of fencing, I state 2 matters:

(a)  As can be seen from the site photographs and the survey sheets, the western side of the Claimed Areas and Lot 698 is a natural slope with thick vegetation.  It acts as a natural barrier.  I accept that there is as a result no need to erect any fence along that side of the boundaries; and

(b)  At the south-easterly corner of the Claimed Areas there appears to be a gap which has not been fenced off.  However, as shown on the Identification Plan, and explained by Mr Leung, there is actually a boulder there. Ingress and egress are as a result not feasible.  The erection of any fence there is not necessary.

57.  In the context of the issue of fencing, the experts have considered the aerial photographs and survey sheets. 

58.  In respect of aerial photographs:

(a)  According to Mr Leung[12]:

“ According to the above findings and interpretations, it was concluded that [Lot 1193RP] has been used and occupied for agricultural purpose in or about 1955, and with structures erected since 1964[13] whilst [Lot 698SA and RP] had been used and occupied since 1963. However, it could not be ascertained that whether [Lot 1193 RP] had been fully enclosed by any ground feature throughout the period study due to the blockage of tree crowns as shown on the interpreted aerial photographs.”

(b)  According to Mr Wong[14]:

“ In respect of the North Portion, as shown on P Plan, there is no structure resembling a house or shed for human use or occupation. The only structure that features in the North Portion consists of a fence which is marked ‘FX3’ of P Plan. In my examination of the aerial photos for the period between 1963 and 2017, I cannot find the image of the fence while in the survey sheets of May 1992 and October 2000 (see Annex 65 and 70) the fence was marked.” (emphasis added)

59.  In the Joint Expert Statement, the experts are however able to express the following opinion in respect of the survey sheet of October 2000 (the “Oct/2000 Survey Sheet”), that:

“ Fences were shown joining the wall next to GA6 towards footpath FP1. Gate was shown at similar location as GA7 again and fences was shown leading from this gate halfway down the footpath FP3 …”

60.  When giving evidence in court, Mr Leung expressed the opinion based on the Oct/2000 Survey Sheet that by that date, the Claimed Areas had entirely been enclosed.  As has been pointed out by Mr Pun[15], Mr Leung was not cross-examined on that opinion.

61.  When giving evidence-in-chief, Mr Wong expressed the opinion that he did not see a fence marked on the Oct/2000 Survey Sheet at the part of the northern boundary of the Northern Claimed Area which runs along the southern side of footpath FP1.

62.  However, during cross-examination, a number of aerial photographs since December 1977[16] were shown to Mr Wong.  Features suggesting the existence of a short wall between the footpath FP1 and the northern boundary of the Northern Claimed Area were highlighted to him.  Mr Wong confirmed the existence of a short wall there with reference to the aerial photograph of 8 November 1994[17].

63.  I accept in this regard Mr Pun’s submissions[18] (made on the basis of his cross-examination of Mr Wong) that given the scale of the Oct/2000 Survey Sheet, that the boundary of footpath FP1 and that part of the boundary of the Northern Claimed Area overlap (or at least within a very short distance of each other), and the possible prior existence of a short wall there, any fence along that boundary might not have been marked.

64.  On the evidence before me, I accept Ps’ evidence that upon acquisition from Mr Lai of the cultivation rights in Lot 1193 in April 1979, they in stages fenced off the Claimed Areas with iron mesh and gate.  By no later than October 2000, the entire Claimed Areas had where necessary[19] been fenced off.

H.3.  Question 1(3) — “Did [Ps] at the material times irrigate and cultivate the Claimed Areas for plantation of fruits and flowers thereat?”

65.  I repeat §7 of Mr Mung WS#1 which I accept.  Mr Mung closed his business in 2008[20].

66.  Accordingly, I find that Mr Mung cultivated the Claimed Areas after he closed his business in 2008.

H.4.  The overall issue as to whether adverse possession proved

67.  I make the following specific findings.

(a)  Various structures and land features can be observed from the aerial photographs and survey sheets, as have been described by the experts in the Joint Expert Statement.  I will not repeat them save highlighting some of the more important features below;

(b)  Ps have been living at Lot 698 (or No 164) since February 1961;

(c)  Mrs Mung became the registered owner of Lot 698 on 4 March 1963.  She purchased it from Shik Yan Shan (釋仁山) of Tung Po Tor at the consideration of $15,000;

(d)  The Brick House was first built between January 1963 and December 1964. It straddled over Lot 698 and Lot 1193;

(e)  Mr Mung ran his business from around 1967 until 2008;

(f)  On 6 February 1971, Tat Fung became the registered owner of inter alia Lot 1193;

(g)  According to the survey sheet of March 1971[21], the Brick House together with certain land was enclosed by a continuous wall (WX1) and fence (FX1) with 3 gates.  Part of the land so enclosed was within the Claimed Areas;

(h)  Patrick Mung became a registered customer of CLP Power in respect of No 164 in April 1976, and has been as such since[22];

(i)  From a number of aerial photographs since December 1977[23], features suggesting the existence of a short wall between the footpath FP1 and the northern boundary of the Northern Claimed Area could be seen.  In the course of cross-examination, Mr Wong specifically confirmed the existence of a short wall there with reference to the aerial photograph of 8 November 1994[24];

(j)  On 13 April 1979, Mrs Mung acquired from Mr Lai the cultivation rights in Lot 1193;

(k)  I accept Ps’ evidence of that upon acquisition from Mr Lai of the cultivation rights in Lot 1193 in April 1979, they in stages fenced off the Claimed Areas with iron mesh and gate.  I repeat my findings in respect of specific question 1(2) above;

(l)  According to the aerial photograph of October 1979[25], certain areas at both Lot 698RP and the Claimed Areas outside the wall WX1 at the north was paved with concrete, possibly for access purpose[26];

(m)  In 1980, except the concrete area and the two footpaths, the Northern Claimed Area was covered by dense vegetation and trees[27];

(n)  Since 1987, Mr Mung has been registered as a registered user of the Water Supplies Department in respect of No 164[28];

(o)  From the aerial photograph of July 1987, a new wall (WX3) together with two new gates (GA4 and GA5) were found erected at the northern side of the Brick House and wall WX1 within the Claimed Areas[29];

(p)  Fences were shown joining the wall next to GA6 (FX3) towards the footpath FP1.  I refer to my findings in respect of specific question 1(2). The Claimed Areas have where necessary been fenced off since.

68.  I accept Ps’ evidence that they have had exclusive possession of the Claimed Areas.  While enclosure is not indispensable in order to prove adverse possession, I find the evidence compelling that as from at the latest October 2000, Ps have where necessary fenced off the Claimed Areas.  I find that they have had exclusive possession of the Claimed Areas since latest then.

69.  I accept Ps’ evidence that they have enclosed the Claimed Areas to exclude them the best they could from the world at large.  I am satisfied that they have established the requisite intention.

70.  In reaching those conclusions, I have considered Mr Yim’s closing submissions.  I have in particular considered:

(a)  the small gap in the fencing he has pointed out[30] between WX3 and GA2[31].  I note that that gap was on the western side of the Claimed Areas and Lot 698 next to the natural slope.  I do not find any gap there material;

(b)  Mr Yim’s submissions[32], in the context of the issue of animus possidendi, that “[t]here was no averment that Ps intended to exclude [Tat Fung] from the Claimed Areas or they would refuse to pay rent to [Tat Fung] if asked.  The word ‘intention’ or variations thereof did not appear in the Statement of Claim and the [ASOC]at all”.  In my view, Ps’ claim based on adverse possession has been adequately pleaded in the ASOC.  Mr Yim’s submissions in this regards have no merits, which I reject.

71.  For the reasons set out above, I accept Mr Pun’s alternative submissions[33] that counting from October 2000, adverse possession of the Claimed Areas has been established for more than 12 years next before the commencement of the present action in 2014.  I highlight the fact that at §11 of the ASOC, Ps have pleaded their alternative case based on the limitation period of 12 years.

H.5.  Issue 2 — the exact location, boundary and area of the Claimed Areas

72.  In this regard, I accept Mr Pun’s submission[34] that the exact location, boundary and areas of the Claimed Areas have all been agreed by way of the agreed Identification Plan.

H.6.  Issue 3 — Tat Fung’s Counterclaim

73.  Upon my findings above, Tat Fung’s Counterclaim is liable to be dismissed, and I so order.

I.  Conclusion

74.  I make the following Declarations:

(a)  that Tat Fung’s title to, rights of and interest in the Claimed Areas as shown in the Identification Plan was, and has been, prior to the commencement of this Action extinguished by virtue of Section 17 of the Limitation Ordinance, Cap 347; and

(b)  that Ps have been in adverse possession of the Claimed Areas as shown in the Identification Plan for a period in excess of 12 years next before the commencement of this Action by virtue of Section 7 of the Ordinance.

75.  In my view, the above sufficiently dispose of Ps’ claim.  I do not find it appropriate to make the “further or alternative” Declarations sought by Ps at §§(1)(iii) and (1)(iv) of the prayer.

76.  I dismiss D’s Counterclaim.

77.  I make a costs order nisi that Ps shall have the costs of the action, to be made absolute within 14 days from the date hereof unless any application is made in the meantime for variation, in which case this Court will give further direction on the papers on the further conduct of the same.

Annex A

Identification Plan (Not to scale)

Annex B

Plan showing the location of the relevant land and brick house (Not to scale)