LIN LOI HING v. The Personal Representative of LIN LOK SHI also known as LOK KIU (deceased)

HCA 1330/2013

[2024] HKCFI 3056

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1330 OF 2013

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J U D G M E N T

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Introduction

1.  The Plaintiff and Madam Lin Lok Shi (also known as Lok Kiu, “Deceased”) were and remain to be the two registered co-owners in equal shares of Lot No.72 Section B in Demarcation District 215, Sai Kung (“Lot”). By a summons filed on 3 October 2024 (“Subject Summons”), the Plaintiff applied for default judgment pursuant to Order 19 rule 7 of the Rules of the High Court (“RHC”), seeking, inter alia, declaratory reliefs that the title of the personal representative of the Deceased (“1^st Defendant”) to the 50% share of the Lot has been extinguished and that the Plaintiff has acquired a possessory title to the 50% share of the Lot registered in the name of the 1^st Defendant.[1]

Procedural background

2.  On 19 July 2013, the Plaintiff issued a Writ of Summons endorsed with a Statement of Claim against the 1^st Defendant. As the Deceased had passed away on 31 March 1974 with no grant of probate or letters of administration having ever been obtained in respect of her estate, the Plaintiff and the Official Solicitors jointly applied for and obtained a court order on 6 December 2013 that the Official Solicitors be appointed to represent the Deceased’s estate for the limited purpose of accepting service of an Amended Writ. An Amended Writ was then filed and served by the Plaintiff on 12 December 2013.

3.  On 10 January 2014, the Plaintiff filed a summons seeking, inter alia, an order that he be granted leave to carry on the proceedings in the absence of a person representing the estate of the Deceased. On 23 January 2014, Master Levy directed the Plaintiff to write to the Department of Justice (“DoJ”) to ascertain its views. After some exchange of correspondence with the DoJ, the Plaintiff applied for an order to join the Secretary for Justice (“SJ”) as a party (as the 2^nd Defendant) to these proceedings and Master Chow made that order on 24 September 2015. A consent order was further made by Master Chow on 11 November 2015 that the action be adjourned sine die with liberty to restore pending the Plaintiff’s further evidence in respect of his familial relationship with the Deceased. On 18 December 2015, the Plaintiff filed such further evidence.

4.  After that, there were few developments in these proceedings until the Plaintiff received a letter from the DoJ dated 28 March 2024 confirming that the SJ did not intend to claim bona vacantia in respect of the Lot and that he would like to withdraw from the proceedings.

5.  On 19 June 2024, Master Leung made, inter alia, the following orders: (1) the action between the Plaintiff and the 2^nd Defendant (i.e. the SJ) be restored; and (2) leave be granted to the Plaintiff to discontinue his claims against the 2^nd Defendant in this action.

6.  On 10 September 2024, the Plaintiff further obtained the following orders (“the 10^th September 2024 Orders”) from Master Hui: (1) the action between the Plaintiff and the 1^st Defendant be restored; (2) the Plaintiff be granted leave to carry on these proceedings in the absence of a person representing the estate of the Deceased; (3) service of documents on the 1^st Defendant be effected by ordinary post to the 1^st Defendant’s last known and specified address in Sai Kung; (4) leave be granted to the Plaintiff to amend the Amended Writ of Summons and to file and serve the same after its amendment; and (5) leave be granted to the 1^st Defendant to file and serve a Defence, if any, within 7 days thereafter. On the same date, a Re-Amended Writ of Summons was filed with the Court and served on the 1^st Defendant by ordinary post. On 23 September 2024, the 10^th September 2024 Orders were also served on the 1^st Defendant by ordinary post.

7.  The Plaintiff filed the Subject Summons on 3 October 2024 and it was served on the 1^st Defendant by ordinary post on the next day. The hearing of the Subject Summons was scheduled to be held on 25 October 2024. On 21 October 2024, the Plaintiff served on the 1^st Defendant the papers for the hearing by ordinary post including the hearing bundle and a copy of the Plaintiff’s Skeleton Submissions.

8.  The hearing of the Subject Summons was held on 25 October 2024 as scheduled in the absence of the 1^st Defendant.

Legal principles on granting default judgment and declaratory reliefs

9.  It is trite that the Court’s power to grant a default judgment under Order 19 rule 7 of the RHC is discretionary and the Court has to consider the plaintiff’s case according to the pleadings. While the plaintiff must show a case for the order which he seeks to obtain, it is not necessary for him to prove his case by evidence.

10.  It is not the normal practice of the Court to make a declaration of rights without a trial. This is, however, not a rule of law, but only a rule of practice which should not be followed when the plaintiff had a genuine need for the declaratory relief and if justice would not be done in the event such relief were denied. The Court will scrutinize the application for default judgment carefully and will not hastily grant the relief sought. The declaratory relief to be granted should not be in terms wider than what the plaintiff is entitled to and what is necessary to do justice to him: Hong Kong Civil Procedure 2024, Vol. 1, at §19/7/20 (at p.583).

Legal principles on adverse possession

11.  In Lam Clansmen Mutual Aid Association Ltd v Lam Kam Loi, the Personal Representatives of Lam Yiu Chi, Deceased, HCA 2005/2018, [2020] HKCFI 2816 (unreported and dated 6 November 2020), Deputy High Court Judge William Wong SC explained succinctly at §17:-

“The law on adverse possession is also well-established. Put simply, three elements have to be satisfied:-

(a) First, factual possession. The adverse possessor must show a sufficient degree of physical control of the land. In this connection, enclosure is probably the strongest possible evidence of adverse possession.

(b) Second, animus possidendi, in other words an intention to possess the land to the exclusion of all other persons including the paper owner. Clear and affirmative evidence is required to show that such an intention to dispossess has been made sufficiently clear to the world, and particularly to the attention of the paper owner.

(c) Third, the requisite time period. For non-Government lands, the time period is 12 years: section 7(2) of the Limitation Ordinance (Cap 347) (“the Ordinance”).

(d) The combined effect of the common law, together with sections 7, 8, 13 and 17 of the Ordinance, is that for non-Government lands, the paper owner’s title to the land would be extinguished vis-à-vis the adverse possessor after 12 years of continuous exclusive possession with the requisite animus possidendi.

See: Fung Sau Mui Janne v Fung Wing Tong HCMP 798/2016 (unreported, 3 October 2018), §§78-79 per DHCJ William Wong SC. For completeness, as per section 38A of the Ordinance, the relevant time period is 20 years if the cause of action accrued before 1 July 1991.”

12.  In Sik Wai Chun v The Personal Representative of the Estate of Sik Che Fong, Deceased, HCA 1779/2021, [2023] HKCFI 1712 (unreported and dated 28 June 2023), Deputy High Court Judge H. Au-Yeung (as he then was) set out the following legal principles at §§6-8:-

(i)  At the expiration of the prescribed period for any person to bring an action to recover land, the title of that person to the land shall be extinguished: section 17 of the Limitation Ordinance. However, the effect of expiration of the period is only that it extinguishes the title of the dispossessed against the squatter; it does not convey the paper owner’s title to the squatter: Lam Sai Wan v Minloy Limited [2022] 1 HKLRD 544 at §36.

(ii)  A person claiming to be in adverse possession must be shown to have both possession and the requisite intention to possess. The possession must be “as of wrong”: Wong Tak Yue v Kung Kwok Wai & Another (No 2) (1997-98) 1 HKCFAR 55 at 68E, F & H.

(iii)  While it is possible for a co-owner of land to claim adverse possession against the other co-owner, there has to be ouster before the possession of one of the co-owners is to be treated as adverse against the other: Forgeard v Shanahan 35 NSWLR 206 at 221, followed in Cheung Lai Mui v Cheung Wai Shing (2021) 24 HKCFAR 116, [2021] HKCFA 19 at §48.

13.  An ouster may be presumed where there has been a long and exclusive enjoyment by one co-owner. In Lai Wai Kuen v Wong Shau Kwong, HCA 3424/2003, [2004] 4 HKC 528 (unreported and dated 12 November 2004), Lam J (as he then was) held at §11 that the plaintiff’s exclusive possession of the property for over 50 years and use of the property for rental for his own benefit, and the absence of request for account and payment of rent or profits to the defendant, were found to be sufficient to presume ouster. See also Cheung Wing Fan v Wong Wai Ping, HCA 1371/2020, [2021] HKCFI 516 (unreported and dated 26 February 2021) at §8.

14.  For the purpose of deciding whether the defendant’s title has been defeated by limitation, the Court does not need to decide the precise point of time when the plaintiff entered the property so long as it is satisfied that the plaintiff has proved that he has been there for the requisite period with the necessary intention to possess; this is what the Court which is seized of the matter should decide: Yu Siu Cheuk v Realray Investments Ltd, CACV 181/2009 (unreported and dated 10 November 2009) at §17.

15.  A party can establish adverse possession through occupation by his licensee: see Sze To Chun Keung v Kung Kwok Wai David & Anr [1997] HKLRD 885, at 888.

The Plaintiff’s case

16.  The Plaintiff’s case as pleaded in the Re-Amended Writ of Summons and the Amended Statement of Claim can be summarized as follows.

17.  The Deceased was the Plaintiff’s adoptive grandmother, as she and her husband (“Grandfather”) had adopted the Plaintiff’s father (“Father”).

18.  The Grandfather and the Deceased each became 50% owner of the Lot on 24 February 1932.

19.  After the Grandfather and the Father passed away, the entirety of the Grandfather’s 50% share of the Lot was passed to the Plaintiff as the only surviving male heir to the family. By an instrument dated 21 October 1959, he registered his interest in the Lot together with a trustee named Lin Mau Tai. On 13 January 1965, he had the trustee removed from the title of his share in the Lot. The Plaintiff was then a co-owner with the Deceased, each having a 50% share of the Lot.

20.  The Plaintiff and the Deceased continued to live in the Lot after the demise of the Grandfather and the Father. In 1961, the Plaintiff and his wife migrated to England but whilst living abroad, he paid for all the living expenses of the Deceased, including all utilities, outgoings and expenses in respect of the Lot, and arranged for an aunt (Madam Lin Yuk Kiu, “Aunt”) to take care of the Deceased in his absence.

21.  The Deceased lived in the Lot until she passed away on 31 March 1974. No grant of probate or letters of administration has ever obtained in respect of her estate.

22.  It is specifically pleaded in the Amended Statement of Claim that since the demise of the Deceased, the Plaintiff has regarded himself as the sole owner of the Lot; and he has been in continuous and exclusive possession of the Lot to the exclusion of the world at large, including the 1^st Defendant, through occupation by his licensees, namely the Aunt and her family, and his tenants. In particular, it is further pleaded that the Plaintiff took the following decisions or actions which substantially affected the Deceased’s interests in the Lot:-

(i)  In about 1979, the Plaintiff applied to the Sai Kung District Office to re-develop the old village house that was on the Lot into a small house (“New House”);

(ii)  On 10 January 1980, the Plaintiff entered into a contract for the construction of the New House as the sole owner of the Lot; he then authorised the Aunt to supervise the construction of the New House and he contributed solely to the full contract price of HK$180,000;

(iii)  The Plaintiff occupied the New House and the Lot from 1 August 1980 onwards through occupation by the Aunt, her family and his tenants, and he started to pay for the utilities, outgoings and expenses of the New House and the Lot.

(iv)  The Plaintiff and the Aunt had agreed (“the Agreement”) that the Aunt and her family could live rent-free on the ground floor of the New House and use the laundry area as his licensees. In exchange, the Aunt would let out the other floors of the New House, collect and keep the rental income for and on behalf of the Plaintiff, and arrange for payment of all utilities, outgoings and expenses in relation to the New House and the Lot out of the rental income; and she would manage the New House and the Lot for the Plaintiff and pursuant to the Agreement with him;

(v)  From about August 1980, the Aunt and her family had been living on the ground floor of the New House and she had leased out the other floors of the New House and managed the Lot as per the Agreement with the Plaintiff. The Aunt kept the rental income and remitted money to the Plaintiff in such amount and at such time as he requested. She also used part of the rental income to pay for the utilities, outgoings and expenses in relation to the New House and the Lot, and to make annual donations to a church in Sai Kung as instructed by the Plaintiff; and

(vi)  On 27 January 1984, the Plaintiff executed a general power of attorney in favour of the Aunt to enable her to manage the New House and the Lot for and on behalf of him pursuant to the Agreement. With the Plaintiff’s consent, in or about 1999, the Aunt’s daughter took over the duty to let out and manage the New House and the Lot.

23.  It is also pleaded by the Plaintiff that he has been in sole and exclusive possession of the Lot since the demise of the Deceased without any claim or demand by any person claiming under the Deceased; and no person acting for and on behalf of the 1^st Defendant has ever come to the Lot or otherwise to assert any interests in the Lot or requested the Plaintiff for account and payment of rents and profits generated from leasing out the New House.

24.  It is therefore the Plaintiff’s case that by his decisions and actions as set out in §22 above, the Plaintiff has had factual and exclusive possession of the Lot and evinced a clear and unequivocal intention to possess the Lot to the exclusion of the world, and in particular the 1^st Defendant. The Plaintiff’s claim on adverse possession is further premised on the fact that he has had a long and exclusive enjoyment of the Lot without any demand from any person acting for and on behalf of the 1^st Defendant for account and payment of rent or profits.

Discussion

25.  It is significant to note that the Plaintiff is already a co-owner of the Lot and is now claiming adverse possession against the other co-owner, namely the Deceased and/or the 1^st Defendant. According to the pleadings, since the demise of the Deceased, the Plaintiff has regarded himself to be the sole owner of the Lot and has had exclusive factual possession of the Lot, as demonstrated by his decisions and actions described in §22 above. In the Court’s view, the Plaintiff has at least since August 1980 had factual possession and enjoyment of the Lot through the occupation by his licensees (namely the Aunt and her family) and his tenants to the exclusion of the 1^st Defendant and the world at large. The Court does not need to decide the precise point of time when the Plaintiff commenced his exclusive possession of the whole Lot so long as it is satisfied that the Plaintiff has proved that he has obtained such possession for the requisite period with the necessary intention to possess. I am so satisfied in the present case.

26.  Applying Lai Wai Kuen v Wong Shau Kwong (supra), the Plaintiff’s exclusive possession of the Lot since at least August 1980, absent any demand from any person acting for and on behalf of the 1^st Defendant for account and payment of rent or profits, is found by this Court to be sufficient to presume ouster to establish adverse possession against the 1^st Defendant.

27.  On the above pleaded facts, I am satisfied that the Plaintiff has made good his case against the 1^st Defendant for adverse possession since at least August 1980 (i.e. for over 20 years before the commencement of the present action) and an ouster may be presumed in the present case.

28.  Turning to the issue of whether a declaratory relief should be granted. This Court observes that no grant of probate or letters of administration has ever been obtained in respect of the Deceased’s estate since her demise in March 1974 (i.e. for more than 50 years). The Plaintiff has commenced these proceedings for more than 11 years and no one acting for and on behalf of the 1^st Defendant has ever come forward to oppose the action. The order of Master Hui dated 10 September 2024 permitting the Plaintiff to carry on these proceedings in the absence of a person representing the Deceased’s estate also supports the Court’s finding of the lack of likelihood of any person turning up to make a claim in respect of her estate or the Lot.

29.  The Plaintiff is now at the age of 84, currently residing in England. He is in declining health and suffering from some heart conditions. He has expressed his wish to “recover” the entire Lot in the time he has remaining in order to effectively manage and deal with the entire Lot. The Plaintiff is satisfied with a possessory title to the Deceased’s 50% share of the Lot. This Court can discern nothing special or suspicious that justifies or requires the Plaintiff to return to Hong Kong to prove his case by evidence at trial. In all the circumstances of this case, I am satisfied that the grant of declaratory reliefs is necessary to do justice to the Plaintiff and they are to be granted in terms not wider than what he is entitled to.

Order

30.  For the above reasons, I grant the following orders:-

(a)  a declaration that the title of Lin Lok Shi also known as Lok Kiu (“the Deceased”) to the 50% share of Lot No.72 Section B in Demarcation District 215, Sai Kung (“the Lot”) had been extinguished prior to the commencement of the present action by virtue of section 17 of the Limitation Ordinance, Cap. 347;

(b)  a declaration that the Plaintiff has acquired a possessory title to the 50% share of the Lot registered in the name of the Deceased; and

(c)  there be no order as to the costs of this action and of this application.