CHENG OI HAN v. NG PAN KIN AND ANOTHER

DCMP 3364/2020

[2022] HKDC 36

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 3364 OF 2020

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JUDGMENT

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1.  The plaintiff (“P”) claims that she has acquired a possessory title to the following pieces of lands (“the Subject Lands”):-

(1) Lot 231A in D.D. 107, Yuen Long, New Territories;

(2) Lot 242F in D.D. 107, Yuen Long, New Territories;

(3) Lot 243A in D.D. 107, Yuen Long, New Territories;

(4) Lot 241A in D.D. 107, Yuen Long, New Territories;

(5) Lot 242B in D.D. 107, Yuen Long, New Territories;

(6) Lot 344B in D.D. 107, Yuen Long, New Territories; and

(7) Lot 345B in D.D. 107, Yuen Long, New Territories.

2.  By an originating summons dated 20 October 2020 (“the OS”), P seeks, inter alia, the following declarations in respect of the Subject Lands:-

(1) P has been in adverse possession of the Subject Lands for a continuous period of over 20 years and have hence acquired possessory title to the same.

(2) The title of the 1^st defendant (“D1”), or his successors-in-title or any persons deriving title from him in relation to the Subject Lands had been, prior to the commencement of these proceedings, extinguished and any claim of D1, or his successors-in-title or any persons deriving title from him, had been barred by virtue of sections 7 and 17 of the Limitation Ordinance (“LO”).

(3) The title of the 2^nd defendant (“D2”), or his successors-in-title or any persons deriving title from him in relation to the Subject Lands had been, prior to the commencement of these proceedings, extinguished and any claim of D2, or his successors-in-title or any persons deriving title from him, had been barred by virtue of sections 7 and 17 of the LO.

3.  Having considered the papers, I am satisfied that P has duly served the OS on D1 and D2 pursuant to an order for substituted service dated 16 April 2021, and has duly give notice of this trial to D1 and D2 pursuant to an order for substituted service dated 5 August 2021.  Neither D1 nor D2 has filed a notice of intention to defend in these proceedings, and neither of them has filed any affidavit or affirmation in response to P’s application.

4.  P’s case is as follows:-

(1) Evidence of Possession of the Subject Lands

(a) In or around 1949, P’s father-in-law built a residential home to live with his family on 23 lots of land (“the Family Land”).  The Subject Lands is part of the Family Land and situates within the Family Land.  P’s case is that she has, through herself and her predecessors in title, been in continuous, undisturbed and uninterrupted exclusive possession of the Subject Lands.

(b) In 1978, P married to her late husband (“Mr Wan”). Since then, P moved into the Family Land to reside with Mr Wan and her father-in-law.  At the time, the Family Land, which included the Subject Lands, was already fenced off with a 10 feet high barbed wire to the exclusion of all others.  P’s father-in-law passed away in 1982, and Mr Wan passed away in October 2015.

(c) Since 1972, proper telephone land lines as well as water and electricity meters were fitted to service the whole area of the Family Land. The payments of such utility bills for upwards of at least 20 years from the commencement of the present action were settled by the P.

(d) Over the years, P, together with her father-in-law and Mr Wan, have built and developed the Family Land for the operation of various family businesses including a wood factory under the business registration of Sun Tai Lee from 1972 to 1994, and selling forage for livestock under the business registration of Tai Ping Hong after 1994. P is the sole proprietor of Tai Ping Hong.  Since 1978, P has been living on the Family Land.

(e) Since around 2006, P leased a structure on Lot 234A of the Subject Lands to Siu Fung Nin Food Products Company Limited and collected rent from the tenant. P used Tai Ping Hong, a business registered under her sole name to enter into the tenancy agreement.

(f) In October 2015, Mr Wan passed away.  P continued to reside on the Family Land and operate Tai Ping Hong as sole proprietor at the Family Land.

(2) Enclosure

(a) Over the years and since 1978, parts of the fencing enclosing the Family Land have been removed and improved. P has always ensured that the boundaries of the Family Land was enclosed by fences. Entrance to the Family Land has always been controlled through locked gates, the keys of which were kept by P and her family.

(b) There are currently two entrances to the Family Land. One of the entrances is primarily used as the entrance for cars and delivery trucks for Tai Ping Hong’s business and the other entrances is secured by a rolling gate which is fitted with a lock. Throughout P’s occupation of the Family Land, P and her family retained the keys for the said entrances to the Family Land to the exclusion of all others.

(c) In or around 2015, several CCTV cameras were installed within the land of the Family Land to strengthen P’s control of the Family Land.

(d) At all material times and at least since 1978, no eviction notices were ever posted on the fencing, structures or otherwise. No notice or demand was ever made requesting P and her family to remove the various structures built on the Family Land or to leave the Family Land.

(3) Even if D1 and D2 turn up and request for use or for possession of the Subject Lands, P would certainly refuse.

5.  P has filed an affirmation dated 6 October 2020 to support her case.  There is nothing from D1 or D2 disputing P’s case.  I accept P’s case.

6.  The principles concerning adverse possession are well established.  A useful summary can be found in Tsang Foo Keung v Chu Jim Mi Jimmy^[1], in which Harris J (Cheung JA and Yuen JA concurring) said:-

“22. Before explaining the Judge’s reasons for rejecting the 1^st defendant’s case it will be helpful to summarise the basic principles of adverse possession:-

(1) If the law is to attribute possession of land to a person who can establish no paper title to it, he must be shown to have had both factual possession during the relevant period (in the present case 20 years as the alleged possession occurred prior to 1991) and the requisite intention to possess.

(2) What constitutes a sufficient degree of exclusive physical control depends on the circumstances of the case and, in particular, the nature of the land and the manner in which land of that nature is commonly enjoyed. What must be shown is that the alleged possessor has been dealing with the land as an occupying owner might expect to deal with it.

(3) The requisite intention is to exclude the world at large, including the owner, from the land so far as is reasonably practicable and so far as the law allows.

(4) The person claiming adverse possession has the burden of proving both exclusive physical control and the requisite intention. Although the standard of proof is still the normal civil standard, ie on the balance of probabilities, commensurate with the serious consequences of finding that the holder of the paper title has been disposed the evidence of exclusive possession and intention must be compelling. It cannot be lightly assumed that the paper title holder has foregone his interest in land.

(5) Evidence of subjective intent should be approached with caution. Intention is normally better assessed by inference drawn from the acts of the possessor in the light of nature of the land and its use.

(6) If a person takes possession by virtue of a licence granted by another, it is the licensor who is treated as being in possession.”

7.  Exclusive possession of the land by the person claiming adverse possession bears significance, as this is relevant to both the requisite factual possession and the requisite intention to possess.  As said by Lam VP in Gotland Enterprises Ltd v Kwok Chi Yau^[2]:-

“32. …… Legal possession could only be established when both elements are present. In our judgment, the exclusion of other persons has significance both in relation to the character of the physical occupation and the requisite intent. Thus, in Powell, Slade J alluded at the end of the paragraph cited above to no-one else had done so. Likewise, Lord Hutton in JA Pye referred to using the land in a way in which the owner was excluded.

33. This is not to re-introduce the concept of ouster disavowed by Lord Browne-Wilkinson in JA Pye at paragraph 38. Rather it stems from the undoubted proposition that possession is single and exclusive. As said by His Lordship in that paragraph:

‘Except in the case of joint possessors, possession is single and exclusive. Therefore if the squatter is in possession the paper owner cannot be. If the paper owner was at one stage in possession of the land but the squatter’s subsequent occupation of it in law constitutes possession the squatter must have ‘dispossessed’ the true owner …’

34. After rejecting the notion that the squatter must have a positive intention to exclude the owner, at paragraph 43 of JA Pye Lord Browne-Wilkinson endorsed the formulation by Slade J in Powell:

‘ … Slade J reformulated the requirement (to my mind correctly) as requiring an ‘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 processes of the law will allow.’

35. The significance of physical exclusion of the owner was further alluded to by His Lordship at paragraph 45, after rejecting the dicta of Bramwell LJ in Leigh v Jack 5 Ex D264:

‘The highest it can be put is that, if the squatter is aware of a special purpose for which the paper owner uses or intends to use the land and the use made by the squatter does not conflict with that use, that may provide some support for a finding as a question of fact that the squatter had no intention to possess the land in the ordinary sense but only an intention to occupy it until needed by the paper owner. For myself I think there will be few occasions in which such inference could be properly drawn in cases where the true owner has been physically excluded from the land. But it remains a possible, if improbable, inference in some cases.’ (our emphasis)

36. One must not lose sight of the exclusive character of the occupation in order to establish factual possession. Not every use or occupation of land can satisfy this requirement. The Judge gave the example of growing of fruits on a piece of open land. If a person only plants fruit trees without excluding others from entering the land, he is only using the land instead of occupying the same exclusively. It is akin to leaving some articles on some private property (where the owner is at liberty to take steps to remove the articles as abatement of trespass) and no matter how long the articles were left there (and not removed by the owner of the land), it would not constitute adverse possession.

37. Though it is not absolutely essential to have the land fenced off in order to establish exclusive occupation, this is the classic way of doing so.  In the absence of any physical barriers set up to exclude others from entering the land, one must examine what steps were taken by the person claiming exclusive occupation to exclude others.”

8.  The possession periods by successive squatters can be added up for the purpose of showing adverse possession.  The LO is not concerned with whether a squatter has acquired a title but with whether the paper owner’s right of action has been barred.  For this purpose, all that matters is that there should have been continuous adverse possession for the period of limitation. The rights inter se of the successive persons who may have been in possession adversely to the paper owner since the paper owner was dispossessed are for this purpose irrelevant.  In Sze To Chun Keung v Kung Kwok Wai David & Anor[3], Lord Hoffmann said in the Privy Council:-

“It therefore appears to their Lordships that, on the facts as pleaded, the land has been continuously in adverse possession since 1955 and that the plaintiffs’ title was extinguished in about 1975. … At the time when proceedings were commenced, the defendant had been in possession on his own account for only two years. Butthis does not matter: the Limitation Ordinance is not concerned with whether the defendant has acquired a title but with whether the plaintiffs’ right of action has been barred. For this purpose, all that matters is that there should have been continuous adverse possession for the period of limitation. The rights inter se of the successive persons who may have been in possession adversely to the plaintiffs since they were dispossessed are for this purpose irrelevant.”

9.  Based upon the evidence accepted by the court, I am satisfied that P’s father-in-law, Mr Wan and P have been in successive possession of the Subject Lands.  Not less than 20 years before the commencement of these proceedings, P has been in exclusive possession of the Subject Lands, with the intention of treating the Subject Lands as her own property to the exclusion of the whole world, including D1 and D2.  In my judgment, P has proved her claim.

10.  P has also produced evidence showing that the combined rateable value of the Subject Lands does not exceed HK$320,000, and hence P’s claim is within the jurisdiction of this court.

11.  In view of all the above, I would give judgment to P.  There be an order in terms of [1] to [3] of the OS.  P does not seek costs.  There be no order as to costs.  I further direct that P may serve this judgment and a sealed copy of the order made herein on D1 and D2 by advertising a notice in a Chinese newspapers widely circulated in Hong Kong once.

12.  Lastly, I thank counsel for the assistance rendered to the court.