GRAY KEVIN MCGOWAN v. WONG TAO NGAR

-------------------

-----------------------

J U D G M E N T

-----------------------

Barnett J.,

1. The Appellant, Mr. Wong, is or was the owner of a flat in Discovery Bay. The Respondent, Mr. Mcgowan, was tenant between 1st February 1989 and 2nd March 1991. He was tenant during that period pursuant to three Tenancy Agreements. The first two agreements were for one year each. The third agreement was for one month, being the month of February 1991.

2. In February 1991, it appears the Respondent was having difficulty in finding new accommodation. By agreement with Mr. Wong, he stayed on in the flat. He effectively surrendered the flat on 2nd March when he left the keys in the Discovery Bay Club where they were collected by Mr. Wong on the same day.

3. In relation to the third Tenancy Agreement, Mr. Mcgowan paid a deposit totalling HK$23,300. That represented HK$18,300 for three months' rent and HK$5,000 in relation to the club.

4. By action in the District Court Mr. Mcgowan claimed HK$19,254.48. That sum was calculated first, by deducting certain admitted expenses; second, by deducting a sum of HK$3,200 which Mr. Mcgowan said was the value of a refrigerator and washing-machine which he left behind. Mr. Mcgowan alleged that Mr. Wong disposed of these items without consent.

5. Mr. Wong counterclaimed for four items. First, HK$18,000 for the cost of replacing a broken toilet bowl. This was not disputed. Second, HK$3,000 for what Mr. Wong described as an administration fee for replacing the toilet bowl. Third, HK$8,700 for painting of the external walls of the flat in or about April 1990. Mr. Wong claimed this on the basis that it was a maintenance charge payable by Mr. Mcgowan in accordance with the Tenancy Agreement. Fourth, HK$4,880 for rental loss arising during the period of 24 days during which the flat was vacant after Mr. Mcgowan had left.

6. The action was tried on 18th March this year before His Honour Judge Downey. Both parties were unrepresented, as they were on the appeal. The judge gave judgment for Mr. Mcgowan for HK$16,054. He dismissed the counterclaim.

7. In arriving at that figure, the judge allowed the admitted expenses and the cost of the toilet bowl. The judge found the value of the refrigerator and washing machine to be very small because they were second-hand items. He decided that their value was cancelled out by "the few hundred dollars", as he put it, to which Mr. Wong was entitled for the inconvenience of having to replace the toilet bowl.

8. The judge rejected the claim for external painting. He held that maintenance charges cover only ordinary management fees. He held that a clear covenant is required to impose liability on a tenant for the repair or maintenance of the fabric of a building. He held that the only obligation on Mr. Mcgowan was to keep the interior of the flat in proper repair.

9. The judge also rejected Mr. Wong's claim for 24 days' rent. He found that Mr. Wong had in fact received HK$6,100 for the month of March. It appears that immediately following the judge's decision, Mr. Wong applied for a review. This was on the basis that the tenancy had ended in February and that he had not received any payment for March. The judge refused to reverse his decision.

10. On 9th April, in the absence of Mr. Mcgowan, Mr. Wong applied for leave to appeal. The judge granted leave on two grounds.. First, on the ground of a possible misunderstanding in the process of translation as to whether Mr. Wong had collected rent for March. Second, whether on the true construction of the Tenancy Agreement Mr. Mcgowan was liable for the external painting.

11. In the documents which Mr. Wong has filed in support of this appeal, he has also asked us to grant leave in respect of two other grounds. First, in relation to the administration fee of HK$3,000 for replacing the toilet bowl. Second, in relation to forfeiture of the whole deposit pursuant to the provisions of the Tenancy Agreement

12. For my part, in relation to the administration fee, I see no reason to disturb the judge's conclusion. The judge, be it remembered, thought the quantum of that fee to be excessive and he set it off against the refrigerator and washing-machine. As to forfeiture of the deposit, it is true that there was a formal claim before the judge. The judge observed, however, that Mr. Wong had not previously exercised his right to forfeit that deposit. He also observed that Mr. Wong had not really pursued that claim at the trial. The judge pointed out that the substance of Mr. Wong's counterclaim was in fact to be able to deduct certain items from that deposit. In my view, it is too late to pursue it now. I would refuse leave in relation to those two additional grounds.

13. I turn then to the first ground. At the trial, Mr. Mcgowan said he had paid Mr. Wong HK$6,100 for the month of March. Mr. Wong, in his examination-in-chief, which was apparently conducted by the judge, said this:

Q. Is it right Mr. Mcgowan paid you HK$6,100 as rent for the flat for the period 1st to 31st March 1991?

A. March 1991, I don't think so. I think he moved away from 1st March 1991.

Q. He says he asked to stay on and you agreed to extend for one month and he paid HK$6,100 rent, do you agree?

A. Yes."

14. Mr. Wong was not cross-examined on that passage or indeed on any other passage by Mr. Mcgowan. It seems to me that that passage admits of ambiguity. The judge himself has now acknowledged the possibility of a misunderstanding. It appears, however, that the misunderstanding is no longer material.

15. We are told that Mr. Wong sold the flat towards the end of March. Mr. Wong says that he could not let the flat during the period between Mr. Mcgowan's departure and the sale because of the damage to the toilet bowl. That appears to be the basis of his claim for, as he puts it, rent. There is, however, no evidence that he could not let the flat during that period because of the damage. Nor is there any evidence of the sort of letting that Mr. Wong might have been able to achieve. Mr. Wong told us today he might have let the flat for short holiday lets which are apparently in favour at Discovery Bay. Mr. Wong should have led evidence of this nature at the trial. In my judgment, it is too late to do so now.

16. I turn to the second ground of appeal which is whether or not Mr. Mcgowan should be responsible for the external painting. Mr. Wong relies upon Clause 2(c) of the Tenancy Agreement. I say, the Tenancy Agreement. There were, of course, three agreements. But a perusal of the lower court records shows that they were in identical  terms. Clause 2(c) reads:

"To pay gas, electric and water charges, maintenance charges if any, metre rents and all outgoings of whatsoever nature, which at any time during the said term shall be or become payable in respect of the said premises save and except only Crown rent and property tax."

17. It is Mr. Wong's submission that all maintenance and repair charges were for Mr. Mcgowan. In the written arguments which he submitted, he said that maintenance charges include the external part of the flat because internal charges are otherwise provided for in the Tenancy Agreement. I disagree with that submission. I believe the judge to have been correct. I believe that a clear covenant is required to impose on a tenant responsibility for repair and decoration of the exterior fabric of premises, particularly if the tenancy is one for a short term. The whole tenor of the Tenancy Agreement, at which I have looked, is to make the tenant responsible for internal decoration and repairs. I do not accept that this responsibility can be extended to the exterior of the premises by the general wording of Clause 2(c).

18. For these reasons, therefore, I would dismiss this appeal.

Fuad V-P,

19. I agree that the appellant should not have leave to appeal on matters outside the order given by the judge on 9th April and I also agree, for the reasons given by my Lord, that the appeal should be dismissed.

Nazareth J.A.,

20. I also agree.