HAU YIN MING v. HAU SUN CHIU

DCMP 1449/2007

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 1449 OF 2007

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J U D G M E N T

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Background

1.  The Plaintiff, Hau Yin Ming ("Ming"), is the registered owner of a plot of land identified as Section A of Taxlord Lot No. 1486 in Demarcation District No. 95 in the New Territories.  I shall refer to Ming's land as Plaintiff's Land.  Adjacent to the Plaintiff's Land is Section B of Taxlord Lot No. 1486, of which the Defendant, Hau Sun Chiu ("Chiu") is the registered owner.  Ming and Chiu are relatives. I shall refer to Chiu's land as Defendant's Land. 

2.   In these proceedings, Ming claims that Chiu had, since about 1980, wrongfully occupied a part of the Plaintiff's Land, in that an L-shaped strip of the Plaintiff's Land had been built upon and possessed by Chiu without the consent of Ming and his predecessors in title.  Prior to Ming acquiring the title to the Plaintiff's Land, the Plaintiff's Land had been registered in the joint names of Hau Kam Keung ("Keung") and Hau Nim Leung (both of whom are Ming's elder brothers) from 1977 until 1981, in the sole name of Keung from April 1981 until 1984, and in the sole name of Liu Kam Lan (Ming's mother) from February 1984 to January 1998, when the Plaintiff's Land was assigned to Ming.

3.  By way of Defence, Chiu claims that he and his father, since deceased, had been using and possessing the L-shaped strip of the Plaintiff’s Land (“Dispossessed Part”) since 1950, for poultry and pig rearing.  It is not disputed by Ming that since 1982, Chiu had constructed a house on the Defendant's Land.  A concrete platform was also constructed by Chiu at about the same time, adjoining the front door of the main house on the Defendant's Land ("Main House").  The concrete platform provided access to the Main House, and extended into the Dispossessed Part.  A small house constructed with aluminium foil was also constructed on the Defendant's Land, a portion of which extended into the Dispossessed Part.  The other portions of the Dispossessed Part were occupied and used by Chiu for storage.  According to Chiu, the Defendant's Land and the Dispossessed Part were all fenced off by him to exclude other people from entering or using the Defendant's Land and the Dispossessed Part.  Keung and Ming do not dispute that after 1982, they had not been able to enter the Dispossessed Part.

4.  It is Chiu's case that he has been in adverse possession of the Dispossessed Part since 1950, and has accordingly acquired a possessory title thereto, such that Ming's title has been extinguished prior to the commencement of these proceedings in 2007 by virtue of s.17 of the Limitation Ordinance.  By way of Counterclaim, Chiu seeks a declaration that he is the rightful owner and has acquired good possessory title to the Dispossessed Part of the Plaintiff's Land by virtue of his adverse possession.

5.  In Reply, Ming claims that an oral agreement ("Oral Agreement") had been made in about 1982 between Chiu, Keung (who was then the registered owner and occupier of the Plaintiff's Land) and Hau He ("He"), the occupier of Taxlord Lot No. 1402 in Demarcation District No. 95  adjacent to the Plaintiff's Land and the Defendant's Land.  Under the Oral Agreement, the parties agreed to settle their disputes as to land boundaries by agreeing that if, in the future, any of them or their issue should need to instruct a land surveyor to set out his land boundary for the purpose of building thereon, any one of them found by the land surveyor to have trespassed on the other's land shall unconditionally deliver up such part of the land as may be wrongfully occupied by him to the true owner thereof.

6.  It is not disputed by Ming that Chiu had been in factual possession of the Dispossessed Part since 1982 when Chiu built the Main House.  However, Counsel for Ming argues that Chiu had been occupying the Dispossessed Part of the Plaintiff's Land under and by virtue of the Oral Agreement, i.e. with the consent of Ming and his predecessors in title, and that Chiu accordingly lacked the necessary intention to possess or animus possidendi.  Counsel for Ming was quick to point out at trial that Ming does not seek to enforce the Oral Agreement, nor to claim that Chiu was in breach of the Oral Agreement.  The Oral Agreement is relied upon only to establish that Chiu was in occupation as of right, and to disprove Chiu's  intention to possess the Dispossessed Part to the exclusion of Ming.

Issues

7.  The sole issue in dispute which arose for determination at trial is whether Chiu had the necessary intention to possess the Dispossessed Part  to the exclusion of Ming.

8.  Determining the issue in dispute turns on 2 questions :

(1)  Was there an Oral Agreement, as contended by Ming?

(2)  If there was an Oral Agreement, did Chiu occupy the Dispossessed Part pursuant to the Oral Agreement with the consent of Ming?

Legal Principles

9.  The legal principles on adverse possession are clear, and Counsel for Ming and for Chiu have relied on the same authorities in advancing their respective cases.  There is a presumption that the owner of the land with the paper title is in possession of the land, and to establish adverse possession, the burden is on the squatter to prove that he has both factual possession of the land and the requisite intention to possess.  As pointed out by Nourse LJ in Buckinghamshire County Council v. Moran [1990] 1 Ch 623, and as applied by Li CJ in Wong Tak Yue v. Kung Kwok Wai & Another [1998] 1 HKLRD 241, adverse possession can be described as "possession as of wrong" and it is the intention of the squatter that is essential.  The requisite intention to possess for adverse possession "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 process of the law will allow" (Powell v. McFarlane (1979) 38 P & CR 452, at 471-472). 

10.  It is a well established principle that the question of intention to possess is one of fact, and whether it can be established depends on an assessment of all the circumstances in a particular case (Wong Tak Yue v. Kung Kwok Wai, supra, at 250).  On the question of intention to possess, Li CJ observed at p.250 of his judgment in Wong Tak Yue, supra :

"Where the occupier has made self-serving statements as to what was his intention, whether during the period of occupation or when challenged in legal proceedings, the courts should approach them with some scepticism.  The courts would scrutinize the circumstances in which they were made and would give them such weight if any as they may deserve.  Conversely, where the occupier has made statements as to what was his intention and such statements are against his interest, the courts would usually accord to them considerable weight."

11.  The requisite intention to possess can be established even if the trespasser mistakenly believes himself to be the owner of the land (Wong Luen Chun v. Secretary For Justice [1998] 4 HKC 122, applying Hughes v. Cork unreported, 14 February 1994; Yeung Kam Wing v. Wong Kwan Mui HCA 8786/1999 22 December 2003).

Was there an Oral Agreement, as contended by Ming?

12.  The evidence of the parties is that there had been disputes amongst Ming's family (including his elder brothers and his mother) on the first part, Chiu on the second part, and He on the third part, in relation to the boundaries of their properties.  Claims had been made by Ming's family that He had built on a narrow strip of the Plaintiff's Land, and that Chiu had built on the Dispossessed Part of the Plaintiff's Land.  On the other hand, Chiu had claimed that the Dispossessed Part fell within the boundaries of the Defendant's Land, and that the kitchen built upon the Plaintiff's Land by Ming's family had encroached into the boundaries of the Defendant's Land.  According to Ming's evidence, there had been numerous arguments between Ming's family and Chiu as a result of these boundary disputes.

13.  In an attempt to settle these disputes, and as evidenced by a letter dated 28 July 1982 ("DLO July Letter") from the District Lands Office (North) ("DLO") to He, Chiu and Keung, the 3 gentlemen wrote to DLO on 4 July 1982 to seek the assistance of the DLO in setting out the boundaries of their respective lots.  Keung's evidence in this regard is that the 3 of them had agreed to accept the boundaries as set out and determined by Government.  Unfortunately, the response received from the District Lands Officer in the DLO July Letter was that DLO did not provide such service of setting out lot boundaries of private land lots.  It was suggested that the parties should employ a chartered land surveyor in private practice to assist them.

14.  It is not in dispute that the course of events took a turn some time after July 1982, when DLO wrote to Keung, with copy to Ming, to say that the boundaries of Lot No. 1486A could be set out by Government upon payment of a survey fee of $11,807.80. The letter was undated ("Undated DLO Letter").  According to Ming, the Undated DLO Letter was in reply to a letter he had written to the DLO in early 1982, complaining of the boundaries dispute between his family and Chiu.

15.  It is not in dispute that upon receipt of the Undated DLO Letter, He, Chiu and Keung had discussed the matter of setting out the boundaries of their lots, but no one was prepared to pay the survey fee sought by Government.

16.  According to Keung's evidence, it was at He's suggestion that it was then agreed amongst Keung, He and Chiu that should any one of them "or their issue" should decide in the future to build on their properties, a surveyor would be engaged to set out the boundaries, and if it was revealed by the surveror that anyone had trespassed on the other's land, that person would unconditionally deliver up such part of the land wrongfully occupied to the true owner thereof.  According to Keung, the Oral agreement was made some time after receipt of the Undated DLO Letter.  Keung’s evidence as to the time of the making of the Oral Agreement is preferred to that of Ming, who was only informed by Keung of the making of the Oral Agreement after the event.  Ming's case is that as a result of this agreement reached, the disputes between He, Chiu and his family came to a rest.

17.  In March 2006, Ming (who had by then become the registered owner of the Plaintiff’s Land) engaged a surveyor to set out the exact boundaries of the Plaintiff's Land.  According to the survey, the Dispossessed Part was within the boundaries of the Plaintiff's Land, but was occupied by Chiu.  According to the survey, He also occupied a strip of the Plaintiff's Land.  Ming and his brothers informed Chiu and He of the results of the survey.  Ming claims that He delivered up to him the part of the Plaintiff's Land wrongfully occupied by He, but Chiu refused to surrender the Dispossessed Part to Ming.

18.  Chiu admits that there had been disputes between He, Ming and himself in relation to the boundaries of their lots, although he attempted to downplay the intensity of the arguments or his role therein.  Nor does Chiu dispute that he had claimed that the kitchen constructed by Ming's family was built on the Defendant's Land.  According to Ming, Chiu had frequently harassed Ming's mother in relation to the kitchen, complaining that it was on the Defendant's Land.  Chiu sought to deny that Ming's family had complained that Chiu had built on the Plaintiff's Land, although I find this incredible after considering the entirety of the evidence adduced in these proceedings.

19.  Chiu does not deny that he, Ming and He had agreed jointly to ask DLO to define the boundaries of their lots, and to abide by Government's determination in this respect, claiming that if Government should determine any property to be his, then he would use it as his, and if Government should determine any property not to be his, then he would return it to the true owner.  On the evidence, this agreement led to the joint letter to DLO of 4 July 1982, and to the DLO July Letter, with DLO advising the owners that Government did not provide the service of setting out the boundaries of private land lots. 

20.  According to Chiu's evidence, when the parties received the Undated DLO Letter to the effect that the boundaries could be set out but upon payment of a survey fee, as no one was prepared to pay the fee, the matter was concluded by leaving matters unsettled (不了了之).  Chiu denies that there was any subsequent agreement reached, to the effect of the Oral Agreement alleged by Keung and Ming.

21.  The parties are in agreement, however, that there were no further disputes or arguments over the lot boundaries, until 2006.

22.  After hearing all the evidence, I consider that since the parties had been arguing over their boundary disputes (with much acrimony, on Ming's case) since 1980, if not before, it is unlikely that the disputes would have quieten down or discontinued for no reason after 1982, in the absence of some agreement or compromise having been reached.  On a balance of probabilities, I consider it more likely than not that Keung, He and Chiu had agreed some time after receipt of the Undated DLO Letter that they would settle the disputes in the manner claimed by Keung and Ming.  Whether or not the Oral Agreement is enforceable in law is another matter.  As Keung testified, they did not consider the legal niceties at all, nor whether the Oral Agreement was too uncertain in terms to be enforced.

Did Chiu occupy the Dispossessed Part pursuant to the Oral Agreement with the consent of Ming?

23.  Despite my finding on a balance of probabilities that there was an Oral Agreement made between Keung, Chiu and He, I do not accept on the evidence that Chiu occupied the Dispossessed Part pursuant to the Oral Agreement, or that he did not intend, by virtue of the Oral Agreement, to possess the Dispossessed Part to the exclusion of Keung, or members of Keung's family, or the true owner of the Dispossessed Part.

24.  According to Chiu's evidence, he had commenced construction of the Main House in 1982, and the concrete platform was built to provide access to the Main House.  The concrete platform extended from the Main House on the Defendant's Land into the Dispossessed Part of the Plaintiff's Land.  According to Chiu, the Main House was completed a few months before the house-warming banquet held on Chiu's birthday according to the lunar calendar on 2 October 1982, as evidenced by a copy of the invitation sent by Chiu for the banquet.  I accept Chiu's evidence that he had all along treated the Dispossessed Part as falling within the boundaries of the Defendant's Land and accordingly as his own property, as evidenced by his construction on and use of the Dispossessed Part and by his building of a fence around the Defendant's Land including the Dispossessed Part.  He claims that he relies on the fact that on his purchase of the Property, he had been told that the entire area including the Dispossessed Part and the area at which the kitchen used by Keung, Ming and their family was later constructed belonged to him.  Even on Ming's evidence, when he approached Chiu to surrender the Dispossessed Part to Ming, Chiu had insisted that the entire area including the Dispossessed Part belonged to him.

25.  On the entirety of the evidence presented in this case, I do not accept that the fact of Chiu entering into the Oral Agreement, even on the terms contended by Keung and Ming, necessarily meant that Chiu occupied the Dispossessed Part with the consent of Keung or Ming, and without the intention to exclude Keung or Ming as the true owners of the Dispossessed Part.  The fallacy of the argument advanced on behalf of Keung is that the lack of the requisite animus possidendi does not necessarily follow from the making of the Oral Agreement.   On the evidence before me, Chiu had entered into the Oral Agreement on the one hand asserting and genuinely believing himself to be the true owner of the Dispossessed Part, but at the same time agreeing to deliver up to the true owner any part of the property then occupied by him (be it the Dispossessed Part in its entirety, or a portion of the Dispossessed Part, or any other portion of the occupied property), in the event that a surveyor should be able later to establish that he had trespassed on to the property of Ming and/or He.  He may have considered the event of his being found to be trespassing to be unlikely, and hence agreed to it in the belief or hope that the surveyor may establish instead that Keung and Ming had in fact wrongfully occupied the Defendant’s Land.   In any event, and apart from any unnecessary speculation, the evidence is clear that from 1982 if not before, Chiu had all along displayed and did not cease to display the intention to possess the Dispossessed Part to the exclusion of everyone else, Keung and Ming included.    This is supported by Keung’s own evidence that even after 1982, he had never entered the Dispossessed Part as he was not able to by virtue of the fact that Chiu claimed that the Dispossessed Part was his property.

26.  Perhaps Keung, Ming and their family had relied upon the Oral Agreement in not taking further action to seek recovery of the Dispossessed Part from Chiu, but the reality is that they did not take such action before the expiry of the limitation period from Chiu's possession.  I accept the arguments raised by Counsel for Chiu that the Oral Agreement is in any event too uncertain to be enforceable by Keung, the party to the Oral Agreement, let alone Ming who is neither a party to the Oral Agreement nor Keung's issue on behalf of which the Oral Agreement was alleged to have been made. 

27.  In the circumstances of this case, I am satisfied that Chiu had the necessary animus possidendi or intention to possess the Dispossessed Part to the exclusion of Keung, his mother and Ming.

Conclusion

28.  In view of my findings, I dismiss Ming's claims in this action, and grant on the Counterclaim a Declaration that Chiu is the owner and has acquired good possessory title of the Dispossessed Part of the Plaintiff's Land by virtue of his adverse possession.

29.    I will make a costs order nisi that Ming is to pay Chiu's costs of the original action and of the Counterclaim, with certificate for Counsel, to be taxed if not agreed.