KING POLICY DEVELOPMENT LTD v. WAN KIN SHING

CACV 107/2018

[2020] HKCA 738

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 107 OF 2018

(ON APPEAL FROM HCA 696/2015)

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JUDGMENT

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Hon Chu JA giving the judgment of the Court:

Introduction

1.  On 5 June 2020, this Court handed down our judgment ^[1]dismissing the defendant’s appeal against the judgment of Chung J (“the Judge”) given on 29 March 2018^[2]. By the judgment, the Judge granted two injunctions in favour of the plaintiff against the defendant, and dismissed the defendant’s counterclaim with costs to the plaintiff. 

2.  On 26 June 2020, the defendant filed a notice of motion to apply for leave to appeal our judgment to the Court of Final Appeal.

3.  Pursuant to the directions of the Registrar of Civil Appeals, the parties have put in their written submissions and authorities.

4.  Having considered the papers and the written submissions, we see no reason to depart from the usual practice of determining applications for leave to appeal to the Court of Final Appeal on paper without an oral hearing, and have therefore proceeded to determine the applicant’s application on the basis of the documents in the case.

5.  The facts and issues in the case below and in the appeal before the Court of Appeal have been set out in our judgment.  We will not repeat them.

Requirement for granting leave to appeal

6.  Under section 22(1)(b) of the Hong Kong Court of Final Appeal Ordinance, Cap. 484, leave to appeal to the Court of Final Appeal may be granted if the question involved in the appeal is one which, by reason of its great general or public importance, or otherwise, ought to be submitted to the Court of Final Appeal for decision.

Grounds for the application

7.  The notice of motion set out six proposed grounds of appeal.  The defendant’s two written submissions, the first in support of the application and the other in reply to the plaintiff’s submission (respectively “Main Submission” and “Reply Submission”), however, contained 13 questions.  The contents of the three documents are rather difficult to understand, and the 13 questions in the written submission do not correspond to the grounds in the notice of motion.  Doing the best we can, the defendant’s proposed grounds of appeal are summarized as follows:

(1) Ground 1 of the notice of motion, Questions 1 to 5, 8 and 9 in the Main Submission and Questions 10 to 12 in the Reply Submission

The plaintiff’s causes of action are breach of the consent order dated 24 June 2015 (“Consent Order”) and trespass.   The plaintiff’s solicitor misrepresented to the court that the defendant was in breach of his undertaking under the Consent Order, when the works complained of were carried out by the Water Supplies Department. As the defendant had honoured his undertaking, the plaintiff is estopped by the Consent Order from seeking injunctions against the defendant.

(2) Ground 2 of the notice of motion and Question 6 and 7 in the Main Submission

It is an abuse of legal process for the plaintiff to commence the action below (HCA 696/2015), which overlaps with the defendant’s claim for adverse possession in HCA 354/2015, and results in procedural unfairness to the defendant in the conduct of his case.  The Court of Appeal erred in not ordering the two actions to be heard together.

(3) Ground 3 of the notice of motion

The defendant has constitutional rights by reason of his payment of government rates for his shop since 1991, which indicates his shop is a separate tenement, his being in actual occupation, which gives him title to the land, and the appurtenant rights stated in the Confirmatory Assignment and Confirmatory Reassignment.

(4) Ground 4 of the notice of motion and Question 13 in the Reply Submission

This case raises questions of public interest and importance, namely, (i) is there restriction to the administration, execution and implementation of the Water Works Ordinance, Cap. 102 during the execution of the Consent Order on an open lane; (ii) can an owner of a service lane reject works carried out by the Water Supplies Department for water connection and safety measures to other lots when a common water system was situated underneath his land; (iii) can the defendant’s constitutional rights over his separate tenement be nullified when he has been paying rates continuously; and (iv) the plaintiff’s solicitor was guilty of contempt of court for making a misrepresentation in the trial bundles.

(5) Ground 5 of the notice of motion

It is not worthwhile to incur over HK$ 2 million of government revenue to re-route the pipe for supply of water to the defendant’s shop.

(6) Ground 6 of the notice of motion

The Court of Appeal initially accepted the defendant’s argument on the Water Works Ordinance and the easement defence as valid, but took a different view at the adjourned hearing and held that the easement defence was not pleaded.  However, there is no need to plead any fact if it is presumed by law

(respectively “Ground 1” to “Ground 6”). 

Ground 1

8.  The thrust of the defendant’s arguments under Ground 1 is that by agreeing to the Consent Order, which was made following negotiations between the parties, the plaintiff was happy with only claiming damages, and had waived its right to claim injunctions against the defendant.  However, the plaintiff wrongfully claimed in its solicitors’ letter dated 13 August 2015 and also at the trial that the defendant had breached his undertaking given under the Consent Order when the works complained of were carried out by the Water Supplies Department.  The plaintiff’s solicitors further misled the court by including the 13 August 2015 letter in the trial bundles[3]. The court should have found that, as the defendant has honoured his undertaking under the Consent Order, the plaintiff is estopped from claiming injunctions against the defendant.

9.  For the reasons set out below, this is not a viable ground for granting leave to appeal to the Court of Final Appeal.

10.  In the first place, it is a new argument that was not raised at the trial or in the appeal before us.  The plaintiff’s agreement to the terms of the Consent Order did not form part of the plaintiff’s course of conduct that the defendant relied on for his pleaded case of estoppel.  The defendant’s case of estoppel at the trial was based on the 2006 Agreement, the 2007 Agreement and the March 2015 encounters.^[4]  His challenge to the Judge’s rejection of the defence of estoppel in the appeal was also confined to these aspects^[5]. It is not the practice of the Court of Appeal to grant leave to appeal on new points that were not canvassed in the hearing before it.^[6] Nor is it the practice of the Court of Final Appeal to grant leave on new fact-sensitive points not argued in the Court of Appeal.^[7]  

11.  Secondly, this ground relates solely to the circumstances of the case, and does not involve any question of great general or public importance. 

12.  Thirdly, this ground is unarguable.  The Consent Order was made upon the joint application of the plaintiff and the defendant, who were both legally represented, by way of a consent summons dated 23 June 2015 (“the Consent Summons”).  The Consent Summons and the Consent Order were in respect of the plaintiff’s summons filed on 30 March 2015 (“the Plaintiff’s Summons”), in which the plaintiff applied for two interlocutory injunctions against the defendant. 

13.  The Consent Order has three features.  First, it contained an undertaking given by the defendant to the Court that (1) he would not, whether by himself or his servants or agents or any of them or otherwise howsoever, continue or carry out excavating work and connect or install water pipes at the lane^[8]; and (2) he would refill and reinstate the lane.  Second, in consequence of the undertaking, it was not necessary to adjudicate on the Plaintiff’s Summons, and the Court made no order on it.  There was no refusal by the court, or abandonment by the plaintiff, of the injunctive relief sought in the Plaintiff’s Summons. Third, the Plaintiff’s Summons only sought interlocutory, not permanent, injunctions against the defendant.  The undertaking given by the defendant was also expressly stated to be pending and until the final determination of the action below.  Neither the undertaking nor the Consent Order has the effect of finally disposing of the plaintiff’s claim for injunctions.     

14.  The effect of the Consent Order is that pending trial of the plaintiff’s claim, the defendant agreed not to carry out excavation and water pipe connection or installation works and also to reinstate the lane, and because of this, the Plaintiff’s Summons was not adjudicated upon and no injunctions were made.  The Consent Order was to maintain the status quo of the parties before the trial and determination of the dispute between them.  Contrary to the defendant’s contentions, in agreeing to the Consent Order, the plaintiff did not give up its right to seek injunctions against the defendant or confine its claim to seeking damages.  The Consent Order does not have the effect of barring the plaintiff from seeking or obtaining at the trial injunctive reliefs against the defendant. 

15.  It follows that it is immaterial whether the connection of the water pipes was carried out by the Water Supplies Department and whether the defendant had complied with the undertaking given in the Consent Order.  It is incorrect for the defendant to contend that breach of the Consent Order is one of the plaintiff’s causes of action.  We have also held in [24] of our judgment that there are no merits in the complaint of misrepresentation against the plaintiff’s solicitors over the hearing bundles. The defendant’s latest assertion that the plaintiff’s solicitors had committed contempt of court is unarguable.

Ground 2

16.  Ground 2 complains that the plaintiff’s action (HCA 696/2015) overlaps with the defendant’s action (HCA 354/2015), amounting to an abuse of legal process and further results in procedural unfairness in that it has restricted the way the defendant conducted his case in the action below.  It is said that we should have ordered the plaintiff’s claim for injunctions in the action below to be heard together with the defendant’s claim for adverse possession. 

17.  This ground is unarguable.  The plaintiff has pointed out that the area where the defendant carried out the excavation works complained of in the action below was outside the area claimed in the defendant’s action.   More importantly, the defendant had never argued before the Judge or this Court that the plaintiff was not entitled to bring the action below or that he somehow suffered prejudice in the conduct of his case. Further, the defendant could have, before the trial of the action below, applied to have the two actions heard together, but he had never sought to do so.  It is now far too late to complain.  The complaint that this Court should have ordered the two actions to be heard together is misplaced. 

18.  Moreover, this ground only relates to the circumstances of the case, and does not involve any question of great general or public importance.

Ground 3

19.  Ground 3 argues that the defendant has constitutional rights by reason of the fact that he has paid rates for his shop since 1991 which indicates his shop is a separate tenement, he has been occupying his shop, which gives him title to the land, and his appurtenant rights as stated in the Confirmatory Assignment and Confirmatory Reassignment.

20.  As with the arguments under Grounds 1 and 2, the issues that the defendant has been paying government rates for his shop as well as the relevance of the payment of government rates to, and its impact (if any) on, the entitlement to install water pipes at the lane are new issues not raised at the trial or in the appeal.  If the defendant wished to rely on payment of rates as the basis for his right to lay water pipes at the lane, he would firstly have to properly raise it on the pleading, which he had not done.  In the absence of proper pleading, even if the defendant wished to argue the issues at the trial or the appeal, he would not be allowed to do so.  As pointed out in [10] above, it is not open to the defendant to raise new arguments in the application for leave to appeal. 

21.  In respect of the Confirmatory Assignment and Confirmatory Reassignment, they provide for a right of way which only entitles the defendant to go pass and repass the lane^[9].  As to the claim for adverse possession based on the occupation of part of the lane by the defendant’ shop, although the defendant had referred to it in the pleading^[10], he had not sought to establish the claim in the action below or claim relief based on it. In any event, these issues are case specific and do not involve any question of great general or public importance.

22.  Ground 3 therefore does not afford a proper basis for granting leave to appeal.    

Ground 4

23.  Under Ground 4, it is said that the intended appeal involves four questions of public interest and importance (see [7(4)] above). 

24.  For the reasons given under Grounds 1 to 3, the four questions either do not arise or are unarguable.  Further, they are all related to the facts and circumstances of the present case, and do not involve any question of great general or public importance.

Ground 5

25.  Ground 5 merely makes the point that it will take over HK$ 2 million of government revenue to re-route the pipe to provide water supply to the defendant’s shop. No question has been formulated or identified for determination by the Court of Final Appeal.  It is not a proper ground for giving leave to appeal. 

Ground 6

26.  Ground 6 suggests that this Court took different views on the defence of easement at the first and adjourned hearings of the appeal.  It also argues that under Order 18 rule 7(3) of the Rules of the High Court, Cap. 4A, the defendant did not have to plead any fact if it is presumed by law.  

27.  At [14] of our judgment, we had explained the reason and purpose of the adjournment of the appeal at the first hearing.  As mentioned in [15], before the appeal hearing resumed, transcript of the trial was added to the appeal bundles and the parties had put in supplemental submissions.  Having regard to trial counsel’s written submissions, the transcript of the trial and for the reasons and analyses we gave at [39] to [46] of our judgment, we concluded that the Judge was entitled to proceed and determine the case on the basis that the defendant had abandoned the defence of easement.  We further explained in [47] to [52] that the defendant had failed to advance a proper plea of easement by prescription and had chosen to run his case without relying on the plea at the trial such that it was too late to allow him to argue the issue in the appeal. 

28.  Order 18 rule 7(3), on which the defendant relies, provides that “A party need not plead any fact if it is presumed by law to be true or the burden of disproving it lies on the other party, unless the other party has specifically denied it in his pleading.”  The rule has no relevance to the present case and does not relieve the defendant of the obligation to plead a proper plea of easement by prescription.

29.  There is also no question of great general or public importance arising under this ground.

30.  For the above reasons, Ground 6 has no merits. 

“Or otherwise” limb

31.  Having considered the matters raised by the defendant and the circumstances of the case, we do not see any basis for granting leave under the “or otherwise” limb.

Conclusion and costs

32.  For the reasons set out above, we refuse to grant leave to appeal to the Court of Final Appeal and dismiss the notice of motion.

33.  Applying the usual rule of costs follow event, we make an order that the defendant pays the plaintiff the costs of this application.  We had considered the plaintiff’s statement of costs for summary assessment dated 23 July 2020.  We are of the view that the costs claimed are proper and reasonable.  We allow the full amount claimed and summarily assessed the plaintiff’s costs of this application at HK$ 38,024.