FUNG YUEN CHING v. SANJIV SINGH

LDPD 3436/2005

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

LDPD Application No. 3436 of 2005

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J U D G M E N T

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Background

1.  The Applicant is the landlord and the Respondent the tenant of the suit premises known as Flat C1 and Car Park No. A1, G/F, Skyline Mansion, Block 1, 51 Conduit Road, Hong Kong (“the Premises”).  The Premises was leased to the Respondent for a 2-year term commencing from 1 December 2003 and expiring on 30 November 2005.  Immediately after the expiry of the written tenancy, the Applicant applied on 1 December 2005 to the Lands Tribunal for possession of the Premises on the ground that the Premises are reasonably required by the Applicant as a residence for “his second son, Man King Chi Eddie (40 of age), his spouse Ng Ching Ching Jolinda (40 of age), his two children Man Hei Ting (6 ½ of age) and Man Hei Kiu (15 months of age)”.

2.  The Respondent filed a Notice of Opposition on 7 December 2005.   He raised the issue that the Applicant “has not demonstrated beyond a reasonable doubt the urgency or pressing need for repossession of the concerned premises.”  Secondly, the Applicant has not served any TTN (transitional termination notice) on him.  Thirdly, the lease of Mr. Eddie Man (i.e. the Applicant’s son who, according to the Applicant, required the Premises for occupation as a residence) should afford a similar protection to him as a tenant; so there would not be any urgent and pressing need for him to vacant his leased premises.  Finally, whilst the Respondent orally agreed on 2 December 2005 with Mr. Eddie Man that provided that the Applicant withdrew her application for possession, he would agree to give up the Premises by 31 March 2006 in order to avoid the loss of time and inconvenience of going through the courts.  However, notwithstanding the oral acceptance of his proposal by Mr. Eddie Man and the Respondent’s signing on 30 October 2005 of the written offer of lease extension, the Applicant still decided not to withdraw this application.

The Applicant’s case

3. The Applicant gave evidence herself.  She admitted that she had sought re-possession of the Applicant because it made sense financially for her son Mr. Eddie Man to occupy the Premises, instead of occupying his leased premises.  The rent payable by the Respondent for the Premises was $17,000 whilst the rent payable by Mr. Eddie Man for the leased premises at Tai Koo Shing was $21,000, excluding the extra rent for the car parking space.  She produced a copy of the lease (Exhibit A1) of the said Tai Koo Shing premises.  It was made on 12 July 2005 between Mr. Eddie Man as the tenant and the landlord for a term of 2 years commencing from 23 July 2005. There was a break clause that “Notwithstanding anything to the contrary hereinbefore contained, the Landlord/Tenant/either party shall be entitled to terminate this Agreement earlier than as herein provided by serving not less than Two months’ written notice or by paying Two months’ Rent in lieu to the Landlord/Tenant/other party provided that the said written notice shall not be served before the expiration of the [Tenth] month of the Term of Tenancy.”  She added that it would be necessary for her/her son to redecorate the Premises, which might take a few months.

4. The Applicant further gave evidence that her son did not own any property and that she herself also did not personally or beneficially own any property other than the Premises.  As for the residence that she resided, she said that it was owned by a limited company the ownership of which was not clear to her, as she was not involved in the arrangement.

The Respondent’s case

5. The Respondent reiterated what he had stated in his Notice of Opposition.  He mainly questioned the Applicant’s need for re-possession in that the Applicant had failed to prove, beyond reasonable doubt, that there was any urgent and pressing need to re-possess the Premises.  The Applicant’s son, Mr. Eddie Man, could stay in his leased premises at Tai Koo Shing until 22 July 2007, as it was a lease for a term of 2 years.  Although the lease contained a break clause, there was no evidence that the landlord had exercised the break clause yet.  In addition, the Respondent contended that it would be unfair to a tenant like himself who was forced to vacate the Premises just because his landlord chose to “by pass” the provisions of The Landlord and Tenant (Consolidation) (Amendment) Ordinance 2004 (No. 16 of 2004) (“the Amendment Ordinance”) by seeking possession on the ground of occupation by the son of the landlord who was over 18 years old, hence denying him of the 12-month transitional termination notice period.

Findings of the Tribunal

6. The Amendment Ordinance has changed the law in respect of continuation of domestic tenancies.   A tenancy created after the commencement date of the Amendment Ordinance on 9 July 2004 will end upon expiry of the contractual term.  A tenancy created before 9 July 2004, which is the situation in the present case, will end upon expiry of a 12-month transitional termination notice served by the landlord on the tenant (sections 5 and 6 of the Amendment Ordinance refer).

7. However, section 7 of the Amendment Ordinance provides that : -

“	(1)	During the continuance of a tenancy as described in section 5(7), the Tribunal may, on the application of the landlord, make an order for possession of the premises to which the tenancy relates, or any part of them, notwithstanding that a transitional termination notice in respect of the premises has not been served, or has been served but has not expired, if the Tribunal is satisfied that the premises are, or that that part of them is, reasonably required by the landlord for occupation as a residence for himself, his father, his mother or any son or daughter of his over the age of 18.
	(2)	The Tribunal shall not make an order for possession under subsection (1) if-
		(a)	in the case of tenancy, the tenant satisfies the Tribunal that, in all the circumstances of the case, it would manifestly not be just and equitable to make the order, …”
	(Underline added)

8. The Respondent contended that the Applicant denied him of the protection and rights of enjoying a 12-month transitional termination notice by applying for possession on the ground of occupation by her son.  This contention is obviously wrong.  It is clear from the above quoted wordings of section 7 that, whether or not a landlord has served a transitional termination notice, the landlord may still terminate the tenancy on the ground of self-occupation.

9. Under the Amendment Ordinance, the 2 issues that I have to decide are : -

(1)	Whether the Applicant reasonably requires the Premises as a residence for his son Mr. Eddie Man and his family; and
(2)	whether it would manifestly not be just and equitable to make the order for possession.

Reasonable requirement test

10. The burden is on the Applicant as the landlord to satisfy the Tribunal that her son Mr. Eddie Man reasonably requires the Premises for his residence.  The Applicant has given evidence at the trial to support her contention that her son Mr. Eddie Man requires the Premises as his permanent home for himself and his family.  I fully accept the Applicant’s evidence in this regard.  I accept that her son Mr. Eddie Man, his wife and his two young children will be going to reside in the Premises after possession is obtained and renovation done.

11. The Respondent did not accept that Mr. Eddie Man reasonably requires the Premises as a residence for himself and his family.  The Respondent contended that Mr. Eddie Man had offered to sell the Premises to him and had told him that it would be difficult to sell the Premises with a sitting tenant and without renovation.  So, the Respondent suggested that the Applicant only used this application as a means of evicting him as a sitting tenant for 9 years.  Also, since Mr. Eddie Man chose to move over to the leased premises at Tai Koo Shing in July 2005, it would be his owned choice to reside there in the first place.  The Applicant therefore failed to prove, “beyond reasonable doubt” that there was “an urgent and pressing need” to re-possess the Premises for self-occupation by Mr. Eddie Man, as the son of the landlord, the Applicant.  In addition, the Respondent contended that the burden of proof rested with the Applicant and Mr. Eddie Man to prove the existence of the urgent and pressing need, including the statements that the Applicant and Mr. Eddie Man did not own any property other than the Premises.

12. I do not accept the Respondent’s contentions in this regard.  Even if Mr. Eddie Man, as the son of the landlord, had offered, on behalf of the Applicant to sell the Premises to the Respondent, this has nothing to do with the issue of whether Mr. Eddie Man reasonably requires the Premises for self-occupation.

13. Also, I do not accept that it would be necessary for the Applicant to bear the burden of proof that she or her son Mr. Eddie Man did not own any other property before the Tribunal could decide on the issue of whether Mr. Eddie Man reasonably requires the Premises for self-occupation.  It has been held in the past that the landlord, in order to establish a reasonable requirement, must show a “genuine present need” for the premises.   A genuine present need is more than a desire, but less than a necessity.  Assessment of the reasonableness of the landlord’s requirement involves looking at the evidence brought by the landlord only of why he wishes to take back the premises.  On the other hand, clearly irrelevant are the relative financial circumstances of the landlord and the tenant and their families because they do not directly relate to the landlord’s requirement but rather to the reasonableness of ordering possession.  Therefore, it has been held that the facts that the landlord can afford other suitable accommodation, that he has other flats that he could repossess, and that he sells other suitable property shortly before the hearing for application for possession are irrelevant.  (Chiu Kan Sui v Hong Kong Polytechnic [1982] HKLR 75, and Wong Pak Shu v Or Chun Nam 919810 Civ App No 135 of 1981 (CA).)

Manifestly not just and equitable

14. The Amendment Ordinance also requires me to consider whether in all the circumstances of the case, it would manifestly not be just and equitable to make the order.

15. It has been held in various cases before the Amendment Ordinance that “manifestly unjust” means “thoroughly unjust”, “plainly, obviously and unmistakably unjust” or that it would cause an ordinary person who knew all the circumstances to throw up his hands in dismay at the thought of possession being ordered and exclaim “that cannot be right”.  (Chow Wing v. Yuen Chi-hung [1980] HKLR 788; Lam Chuk-ying v. Chan Kwok-kwan [1981] HKLR 661 and Lusher v. Hilliard [1980] DCLR 25.)  Although these were held before the Amendment Ordinance, I think that the same principles should still apply to the interpretation of the law under the Amendment Ordinance.

16. As we can find from the above interpretations, mere inconvenience of the tenant will not be sufficient to justify a refusal of the possession order.  It has also been held that the over-riding factor is the right of the owner to exercise the privileges of ownership (Lam Chuk-ying v. Chan Kwok-kwan, supra.)

17. In the present case, I do not find that the circumstances advanced by the Respondent, that he had resided in the Premises for 9 years, that he had 2 sons studying overseas but coming back to Hong Kong for holidays, and he had an elderly mother residing in the Premises with him are sufficient for me to find that it would be “manifestly not just and equitable” to grant the order for possession.  All the matters raised are just inconvenience to the Respondent.  As said before, inconvenience is not a ground to refuse the granting of the order.  Also, if what the Respondent sought to say was that as a result of the rising rental level in the residential market, he would have to pay more for similar accommodation if forced to move out earlier, I also find that this is not a ground for me to refuse the granting of the order.

18. Summing up, based on the facts of this case, I do not find that it would manifestly not be just and equitable to grant the possession order sought by the Applicant.

19. I therefore dismiss the opposition by the Respondent and agree to grant possession order as sought by the Applicant in the present application, which was made on 1 December 2005.  I find that a stay of possession up to the end of May 2006 is reasonable as the time allowed should be adequate for the Respondent to find an alternative accommodation.  I do not agree that the situation of the Respondent warrants a stay up to the end of November 2006 as submitted by the Respondent.

Costs

20. Section 119(R) of the Ordinance provides,

“In any proceedings under this Part, the Tribunal shall not make any order as to costs against a party unless that party has conducted his case in a frivolous or vexatious manner.”

There is no suggestion or evidence that either party has conducted this case in a frivolous or vexatious manner.  Therefore, in accordance with the above provision, the only appropriate order would be no order as to costs.

Orders

21. I therefore make the following orders: -

(1)	The Applicant shall recover vacant possession of the suit Premises from the Respondent for occupation as a residence for her son Mr. Man King Chi Eddie;
(2)	Stay of execution up to 31 May 2006 conditional upon the Respondent paying monthly in advance rent of $17,000 per month; leave to pay arrears (if any) within 14 days from today;
(3)	No order as to costs.