TAM KOK HUNG AND ANOTHER v. WONG WING

DCCJ 4211/2009

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 4211 OF 2009

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DECISION

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INTRODUCTION

1.  The trial involved the claim by the plaintiffs in DCCJ 4211/2009 (“the plaintiffs”) against the defendant in the same action (“the defendant”) for breach of a tenancy agreement.

2.  After trial, I handed down my written judgment on 6 July 2012 (“the Judgment”) whereby I gave judgment in favour of the plaintiffs for damages and interest. I dismissed the counterclaim by the defendant.  I also made an order nisi as to the costs of the action in favour of the plaintiffs.

3.  By summons dated 2 August 2012 (“the Summons”), the defendant applies for leave to appeal against the Judgment. The proposed grounds of appeal and the orders which the defendant intends to seek upon the appeal were set out in the draft Notice of Appeal annexed to the Summons.

4.  Under section 63A(2) of the District Court Ordinance, Cap 336, leave to appeal shall not be granted unless the intended appeal has a reasonable prospect of success, or the matter in the interests of justice ought to be heard by the appellate court.

5.  There is no dispute between the parties that to meet the “reasonable prospect of success” test, an applicant for leave to appeal is required to show more than just an arguable case, but an appeal that has merits and ought to be heard, although the applicant does not have to demonstrate that the appeal will probably succeed (see: Wynn Resorts (Macau) S.A. v Mong Henry, HCA 192/2009, judgment of Chu J (as she then was) dated 10 August 2009).

6.  The background of this case has been set out in paragraphs 2 to 14 of the Judgment. I do not intend to repeat it here.

GROUND 1 OF THE DRAFT NOTICE OF APPEAL

7.  Ground 1 of the draft Notice of Appeal complains that the court erred in not fully and accurately evaluating all the evidence before rejecting the defendant’s case that there was an oral agreement between the parties that they would not exercise the Break Clause (as defined in paragraph 3 of the Judgment) during the period when the new rent was payable.  In paragraph 7 of his Skeleton Submissions, Mr Wilfred Tsui, counsel acting for the defendant at the hearing, elaborated on the argument by saying that the court erred in focusing purely on the words used in the witness statement and their literal meaning, as if the court was deciding on construction of contracts.

8.  I see no merit in such an argument.  For the reasons stated in paragraphs 15 to 18 of the Judgment, there is simply no evidence to support the existence of the so-called “New Rent Deal” pleaded in paragraph 5(b) of the Amended Consolidated Defence and Counterclaim dated 5 July 2011.

GROUNDS 2 AND 3 OF THE DRAFT NOTICE OF APPEAL

9.  In gist, under grounds 2 and 3, the defendant complains that the loss and damage suffered by the plaintiffs were too remote and not within the defendant’s reasonable contemplation at the time when the Tenancy Agreement was made.

10.  In paragraphs 16 and 19 of his Skeleton Submissions, Mr Tsui complained that the use by the court of the “not unlikely result” test in paragraph 25 of the Judgment was an “over-simplification of treatment of the law” and therefore a failure to apply the correct test to the facts of this case.  The allegation of “over-simplification” of treatment of the law was repeated by Mr Tsui in his oral submissions in reply at the hearing.

11.  I do not think there is any merit in the argument.  The use of the “not unlikely result” test in ascertaining what was within the reasonable contemplation of the parties has been expressly approved of by the Court of Final Appeal in Chen v Lord Energy Limited (2002) 5 HKCFAR 297, at paragraph 30.

12.  In paragraphs 26 and 27 of his Skeleton Submissions, Mr Tsui further complained that the findings of fact in paragraph 24 of the Judgment were too general.  Mr Tsui submitted that they denoted something that the defendant understood “could” happen, without any degree of probability that they “would” happen.

13.  Again, I am not satisfied that this argument has any merit.  In Koufos v C. Czarnikow Limited (the Heron II) [1969] 1 A.C. 350, at page 383A-B, Lord Reid explained that he used the words “not unlikely” as denoting “a degree of probability considerably less than an even chance but nevertheless not very unusual and easily foreseeable”. Lord Reid’s dictum was referred to by the Court of Final Appeal in the course of approving the “not unlikely result” test in the Chen v Lord Energy Limited case.  In the context of the present case, the possibility of the plaintiffs selling the Property with vacant possession was certainly not very unusual and easily foreseeable.

GROUND 4 OF THE DRAFT NOTICE OF APPEAL

14.  I agree with Mr Vincent Chen, counsel acting for the plaintiffs at the hearing, that by the Judgment, the defendant was found to have breached the Tenancy Agreement, the deposit of HK$25,000 was forfeited pursuant to clause 7 thereof as liquidated damages, and was set off against the sums awarded in favour of the plaintiffs.  By so holding, the court has already adjudicated on the issue.

CONCLUSION

15.  I am not satisfied that the intended appeal by the defendant has a reasonable prospect of success.  Further, there is no basis for giving leave under the second limb of section 63A(2) of the District Court Ordinance in the circumstances of the present case.

16.  Accordingly, the application under the Summons is dismissed.  I order that the costs of the application be paid by the defendant to the plaintiffs.  Such costs shall be taxed, if not agreed, with certificate for counsel. 

17.  The above order as to costs is nisi and shall become absolute in the absence of any application within 14 days to vary the same. 

18.  Lastly, I thank counsel on both sides for their assistance in this matter.