GLENEALY MANSION LTD v. NORMAN PERSAUD

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JUDGMENT

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Cons, V. -P.:

1. Penlington J., who regrets that he is unable to be present this morning, has authorised me to say that he agrees with the judgment I am about to deliver.

2. This is an appeal from the decision of Mortimer J. who on the 9th April this year made an order for possession and payment of mesne profits against the Defendant in respect of a flat on the 5th floor of 28 Arbuthnot Road, Hong Kong. The plaintiff, a limited company, appeared, as it has before us, by counsel Mr. Benjamin Chain. The Defendant has appeared throughout in person.

3. The action was founded on trepass. Paragraph 1 of the Amended Particulars of Claim - the writ was first issued in the District Court - alleged "the Plaintiff is and was at all material times the registered owner and entitled to possession of the premises ... " The Defendant's wrongful entry is said to have been "on a date unknown to the Plaintiff prior to September 1983".

4. The Defendant did not dispute the Plaintiff's title but sought to justify his possession. In his Defence, as it stood at the commencement of the trial before the learned Judge, he relied upon -

He further averred -

5. Then, just before the learned Judge gave judgment, the Defendant obtained leave to add a further grant of tenancy by one Tan Geok Tee, a director of the Plaintiff. However the Judge's rejection of that suggestion is not challenged by any ground of appeal.

6. Finally on the third day of the hearing in this Court we gave leave to add yet another ground of justification which, after amendment on the 5th and final day, suggests that the Defendant is and was at all times the licencee of one Chan Chun Hon Annette ("Annette") and that the Plaintiff has treated him as such.

7. To understand the Defendant's case it is necessary to go back to 1978. On the 29th November of that year the Plaintiff granted a 3 year tenancy to Annette at a rent of $2,000 per month exclusive of rates payable in advance on the 15th of each month. The learned Judge below assumed that when the 3 year period expired on the 14th December 1981 the tenancy was automatically continued by Section 52(1) of the Landlord and Tenant (Consolidation) Ordinance Cap. 7.

8. Until July 1979 the rent was paid regularly by cheques drawn on the account of one Louis Lee Kwok Kin. The Defendant suggests that at that stage Annette moved out and that the flat was taken over by a Mr. and Mrs. David Lee together with their child and amah. There is evidence from another tenant which tends to support this suggestion and certainly from then until April 1983 the rent was regularly paid by cheques drawn on the account of one Lee Tee Kong David. The rent receipts however remained in the name of Annette and an application submitted to the Commissioner of Rating and Valuation in September or October 1981, which resulted in an increase of rent to $2,600 as from December, named Annette as the Respondent.

9. The evidence of the Defendant was that in March 1983, when Mr. and Mrs. Lee were preparing to move elsewhere, he was introduced to them by a David Fan of the Gainfast Property Agency. He was taken to the premises and there was at that time, as the Judge later accepted on the balance of probabilities, a notice attached to the main gate advising that space was available for rent. The Defendant was then taken to another flat in Bowen Road but preferred the one in question. He went back later with the agent and paid Mr. Lee $6,500 for the purchase of fixtures and fittings, something towards the rent already paid and $6,000 "by way of deposit". He found the request for that last amount curious, but was assured that it was common practice in Hong Kong, "landlords not concerning themselves to execute a tenancy agreement with every occupant of the premises". The Defendant had at the time only very recently arrived in the Colony. He was also told that the landlord did not want the name changed in any other document or bill.

10. His evidence continues that he duly paid the agency fee to Mr. Fan and moved in on the evening of 20th April. He had difficulty with some of his larger furniture and Stephen Liu, a solicitor's clerk who was helping him move, approached a Jennie Shuen who lives on the ground floor. Jennie Shuen is employed by a company associated with the Plaintiff by common directorships and which shares the same office premises and telephone lines. Stephen Liu said in his evidence that he told Jennie Shuen that the Defendant had rented the top flat and that she kindly allowed him to leave a bed at the bottom of the staircase overnight.

11. The Defendant concedes before us that he has no evidence to support the suggestion that either David Lee or Gainfast had authority to act on behalf of the Plaintiff. He says that he believed what he was told, but that does not assist him. The crucial question is how much the Plaintiff knew of what had in fact occurred, for undoubtedly the Plaintiff accepted rent for the ensuing 4 months. However, the two versions of how that happened, are in stark contradiction.

12. The rent due on the 15th May was paid by a cashier's order, drawn on the Hongkong & Shanghai Banking Corporation. The Defendant chose this method, so he said in evidence, partly for financial reasons and partly because he had been told that the landlord liked it that way. The order covered the rent then due and electricity charges with which Annette had been billed. The Defendant said that he put the bill and the cashier's order in a plain envelope and went to the Plaintiff's office. There he specifically asked to see a Catherine Wong, who manages the premises for the Plaintiff, and when she came in answer to the receptionist's telephone call, he handed her the envelope and told her that he had movedin since the 20th April. She acknowledged, he said, with a smile and walked away. Rent was paid similarly on the 27th June and the 28th July, save that he drew his own cheques. Each time he asked specifically to see Catherine Wong and each time he handed the cheque to her personally. He delayed payment of the rent due in August because of problems with water in the toilet and lighting on the staircase. But when he did pay it, on the 14th September, he did it in like manner by a cheque handed personally to Catherine Wong. On all save the first occasion he was accompanied by a Miss Chui, who gave evidence in his support.

13. As the water and lighting problems continued and Jennie Shuen, the lady on the ground floor, was declining to discuss the situation the Defendant, so he said, wrote a letter of complaint. This he left at the reception desk in the Plaintiff's office. He received no reply. However on the 5th November he decided it would be wrong to withhold the rent further and left a cheque, together with a note referring to his letter, also on the reception desk in the Plaintiff's office. He, and Miss Chui, said that the cheque was pushed under his door a few days later.

14. The Defendant said further that he was concerned over the arrears of rent and therefore, on the 12th November, he took to Catherine Wong a cheque to cover one month's rent and outstanding electricity charges. He informed her that he was withholding the second month's due until the services were properly restored. It was then, and only then he said, that she made the suggestion that he was an illegal tenant.

15. The version of Catherine Wong is very different. The first time she saw the Defendant was on the 15th September, (not the 14th September which was the day the Defendant said he paid rent to her). The receptionist was not on duty that day and Catherine Wong was in her boss' room discussing business when the Defendant and a Chinese lady came to the counter outside. She approached to enquire his business and the Defendant complained about the state of the premises in question. Upon further inquiry he said that he was the tenant of the top floor. This surprised her and she informed her boss. As a result of what he said she told the Defendant that he was not a legal occupant and should leave the premises immediately. At this he repeated his complaints and threatened action should he suffer an accident. He then left. In November he returned to make similar complaints to which she observed that she had already told him to move out. Thereafter the Plaintiff returned all cheques tendered by him in payment of the rent. (It is common ground that the cheque dated the 14th September was the last payment accepted by the Plaintiff.)

16. The Judge preferred the evidence of Catherine Wong to that of the Defendant and Miss Chui. He said that he was "on the whole of the evidence ..... satisfied that Catherine Wong did not meet the Defendant until 15/9/83". He does not expressly say that he was satisfied that until then she had no idea that he was even there at all, or that Annette had moved out, but he found Catherine Wong "accurate in all material parts of her evidence", "an honest witness," and "a witness upon whom I felt I certainly could rely", and those two contentions permeated the whole of her testimony. The Judge accepted that Jennie Shuen knew the Defendant was there, but he was not persuaded that she was "an agent of the Plaintiff for any purpose other than simply, perhaps from time to time, to carry some messages or keys". He found nothing in the evidence relating to her "from which it could be imputed, on the balance of probabilities, that the Plaintiff had knowledge of the Defendant's occupation as a tenant".

17. The Notice of Appeal, as first served, set out 51 grounds. Two more were added when the appeal was called on and we gave leave to add yet another on the third day of the hearing and to amend it on the last. Several of the original grounds were withdrawn during the hearing, including a few which had already been argued. Some were later reinstated. I do not propose to deal with those now in issue seriatim. It has not been in all cases easy to understand the exact ground of complaint but very broadly speaking I think they may be conveniently dealt with under the four following heads, and I append to each the grounds which I think subsumed thereunder.

Findings of Fact

18. Three findings of the learned Judge appear to be attacked: -

19. The whole of the building at 28 Arbuthnot Road is owned by the Plaintiff. It contains 7 flats, one unit on each floor, and a car park below. Catherine Wong said that the Plaintiff had authorised no one to act as its agent for letting out flats because the flats were not put out for general rent. They were kept for the use of local staff, or for personnel who came up from branch offices in Singapore or Taiwan. There were exceptions. One was the flat let to a Dr. and Mrs. Li on the 4th floor. That was a decision made by her boss. So far as the "to let notice" on the gate was concerned it was not authorised by the Plaintiff even though the telephone numbers given on it, for enquiry by day or night, belonged respectively to the Plaintiff and to Jennie Shuen.

20. Mrs. Li's evidence was that it was through a similar notice in 1977, and a telephone call to the number given, that her tenancy was in fact obtained. But she added however, that the person who showed her over the flat did not have the authority to grant her a tenancy. That had to wait until she and her husband had been seen by "Mrs. Tan, the wife of the boss".

21. In these circumstances it does not seem unreasonable to me for the Judge to conclude, as he did, that the building was "not on the market" in the usual sense. Even had it been, the mere exhibition of Jennie Shuen's telephone number for those wishing to make inquiries by night would not of itself have indicated that she had been given authority to grant a tenancy binding upon the Plaintiff. It is said that she held herself out as having such authority. I am not sure that the evidence of Stephen Liu really went that far, but even if it did there is no evidence which might impose liability for her words upon the Plaintiff.

22. As to Catherine Wong, she conceded herself to be the manager of the building and responsible for collection of rent and other charges. It is true that she signed the tenancy agreement with Dr. Li and with Annette, but in each case it was only as a witness to the signature of someone else who then represented the Company. There is no evidence which indicates any wider authority.

23. The Defendant has launched a wide ranging attack on the credibility of Catherine Wong. He observes that when giving evidence in the District Court, before the action was transferred, she had dealt with the incident of the 15th September in much lesser detail. She had not mentioned her speaking to her boss, the Defendant's threat of action against the Company or the repetition of his complaints. In that court too she was certain that he returned on the 15th November, whereas later she was not sure whether it was the 15th or the 12th. She had also there denied seeing a letter written by the Defendant on the 12th November although in the trial below she admitted that the person in the firm whom she called "the legal adviser" had shown it to her. She had spoken then of Jennie Shuen as "one of our staff" who had worked for the Company since 1975. In view of the close relationship of the two companies that is perhaps an understandable looseness of language.

24. In the Court below there is said to be a contradiction between her evidence and that of Mrs. Li as to whether or not the latter complained to her of the way in which the Defendant dealt with his garbage on the staircase.

25. Then the Defendant draws our attention to the lack of possible corroboration. Miss Mak was not called - we understand that she took another job some time before the trial and was not to be found at the address given by the Plaintiff's office -, nor was a book available in which she was said to have kept a record of all incoming cheques or money orders. Mr. Tan, Catherine Wong's boss, did not come, despite the Defendant's efforts to serve him with a subpoena.

26. Much play has been made of the addition of the words "without prejudice" to the majority of rent receipts issued as from September 1981. Catherine Wong said that the caveat should have been added to all receipts, but that sometimes the typist forgot. She also said that instructions to that effect had been given to her in 1978, and at one stage in cross-examination she put the date as 1964. If either date is correct there is no apparent reason why the first use is not until 1981. It is suggested that the words were introduced then because it was then that the landlord discovered that Annette was in breach of her tenancy in some way, as for example by subletting or parting with the possession of the premises, and that the landlord wished to preserve its position while still being able to collect the rent.

27. The Defendant has drawn our attention to the electricity charges. Catherine Wong said that the cost of lighting the public parts, that is the staircase, was shared equally between all the tenants, but a perusal of the receipts seems to show that once the Defendant went into occupation the bills sent to Annette, and which he paid, covered the whole of that expense.

28. Finally the Defendant asked us to take into account the fact that neither he nor Miss Chiu, "an independent witness", were shaken in cross-examination.

29. In my judgment none of these considerations, whether taken individually or in the whole, can in any way whatsoever be conclusive. They are such as could be, and no doubt were in this instance, properly urged upon the trial Judge. He would have taken them into account to such extent as he thought fit. Moreover he had the advantage, which we do not, of being able to assess their value in the light of his judgment on each particular witness. In fact he relied heavily on the contemporaneous documents. In his opinion, with which I agree, these provided "support for the Plaintiff's case and Catherine Wong's evidence". He referred in particular to the rent receipts. He could have mentioned as well the Defendant's letter of the 12th November. This was written on the Defendant's return from the office on that day when, as he claimed, he was first told that his presence in the flat was illegal. He writes in the letter that that allegation came to him as a matter of great surprise, since Jennie Shuen had seen him actually moving in. He complains that Jennie Shuen was in the office at the time but Catherine Wong refused to verify what he said. He continues by referring to complaints he had made subsequently to Jennie Shuen, to letters he had written to the Plaintiff and to his attempt to pay a reduced rent. He concludes with the threat of criminal proceedings. If in fact Catherine Wong had at the outset given tacit agreement to his becoming a tenant I would have expected that to have been the main thrust of his letter. It was of far greater moment than the knowledge of someone who at most was no more than a part-time concierge. I would have expected an indignant outburst at Catherine Wong's perfidious conduct in reneging from that agreement. Yet there is nothing. The best that the Defendant can now suggest is that it is incorporated in the contention that "you .... had been accepting $2,600 rent from me personally since the 15th May 1983". For my part I see no reason to interfere with the factual conclusions of the Judge below.

Irregularities of trial

30. The first step that the Plaintiff took to recover the premises by way of litigation was an application lodged in the Victoria Lands Tribunal in October 1984. It alleged principally an unlawful subletting by Annette to the Defendant and made both of them respondents. On the 5th March 1985 the Plaintiff obtained judgment in default against Annette for possession, arrears of rent, mesne profits up to the delivery of vacant possession and small amounts by way of repair and electricity charges. The hearing of the application against the Defendant had been set for the 3rd April, but on that day he failed to appear and judgment was given in default. The judgment was later set aside and further proceedings were discontinued on the 30th July.

31. Paragraph 10 of the Particulars of Claim lodged in support of the Application alleged that the plaintiff first came to know of the Defendant's presence in the premises on or about the 12th November. It will be recalled that that was the date the Defendant said complaint had first been made about his presence.

32. Mr. Lau Wing Keung, the Plaintiff's solicitor, said in evidence below that he was handed the Lands Tribunal file about 3 weeks before the hearing against the Defendant and observed the apparent inconsistency between the first discovery on the 12th November and the refusal to accept rent, also alleged in the same paragraph, since the 15th September. He therefore "called conference with Mrs. Wong. In consequence, I drafted amended grounds". In fact they were not used, for at the hearing, after discussion with the President of the Tribunal he withdrew his application to amend.

33. In answer to the Defendant in cross-examination Mr. Lau said -

34. Ground 38 of the Notice of Appeal suggests that the evidence of Catherine Wong was that she did not see any solicitor before the Lands Tribunal hearing. This is not borne out by the Judge's record, which merely refers to her not seeing any document which mentioned the 12th November. Be that as it may, it is common ground that objection was taken to any further cross-examination of Mr. Lau in this respect and that the objection was upheld. The Defendant complains that the Judge was wrong to prevent his going further. He concedes that the information he hoped to obtain from Mr. Lau was privileged, but submits that since Mr. Lau himself broke the privilege he the Defendant was entitled to carry on.

35. Support for the submission may be derived from Great Atlantic Insurance v. Home Insurance ⁽¹⁾ where to read part of a privileged document in open court was held to be a waiver of privilege in respect of the rest. The privilege is of course that of the client, not the legal representative, but counsel in the course of a trial carries the client's authority. Mr. Lau in the present instance, although the Plaintiff's solicitor, was giving evidence as a witness. There is nothing to indicate that he had similar authority, and indeed the objection of the Plaintiff's counsel indicates that he did not. In my view the objection was properly upheld.

36. In paragraph 5A of the Defence it was alleged that by reason of various matters earlier set out the Plaintiff was "estopped from claiming the Defendant to be a trespasser", and by 5B that the Plaintiff was "barred from recovering possession by reason of lathes, quasi estoppel, waiver and/or acquiescence by its servants or agents one Catherine Wong (manager) and one Jennie Shuen (caretaker/employee of the said premises)."

37. The Defendant claims that he was discouraged from pursuing these defences below because of adverse comments made by the Judge during the course of the Plaintiff's opening speech. That was unfortunate, but has not ultimately prejudiced the Defendant. He has pursued those defences before us and I am not persuaded that any one of them is sustainable.

Submissions of law

38. These may be divided into three. The first is that the Defendant is the licencee of Annette and has been treated as such by the Plaintiff. The submission was initially put in the alternative. Either the Plaintiff knew that the Defendant was in occupation and by raising no objection must be taken to have accepted him as the licencee of Annette. Alternatively by allowing David Lee to take up occupation, Annette granted David Lee a licence, which he in turn assigned to the Defendant. The alternative approach was subsequently abandoned, together with the suggestion that when Annette's interest was terminated on the 5th March 1985 the Defendant became instead the licences of the Plaintiff by operation of Section 53(6A) of the Landlord and Tenant (Consolidation) Ordinance Cap. 7. But in any event, however the Defendant may have become a licencee of Annette, if he did, his interest as such came to an end on the 5th March and cannot thereafter justify his possession against the Plaintiff.

39. The second suggestion is that although it was found that neither the Lees nor Gainfast had the requisite authority to support the tenancy which had been granted to the Defendant, the Plaintiff, by his acceptance of the Defendant as tenant or occupant, had provided that authority by subsequent ratification. However if the Plaintiff had in fact accepted the Defendant as tenant, this submission is to that extent otiose. And as the Judge did not accept that the Plaintiff knew of the Defendant's presence until the 15th September, it is to that extent misconceived.

40. Thirdly it is suggested that the Judge had no jurisdiction to make an award of mesne profits as the Plaintiff had already, on the 5th March, obtained a similar order in the Lands Tribunal against Annette. We have been referred to Order 13 rule 1 of the Rules of the Supreme Court, to the notes in the White Book at 13/1/6 and 13/1/16 and to the authority of Cross v. Matthews⁽²⁾. Order 13 rule 1 relates to claims for liquidated damages. Cross v. Matthews⁽²⁾ was concerned with the alternative contractual liability of an agent and his principal. The Defendant is liable as a tort feasor. So, according to the judgment of the Lands Tribunal, is Annette. There cannot of course be double recovery - although we understand that nothing has as yet been recovered from Annette - and there may be perhaps a question of contribution, yet I see no reason why judgment should not actually be entered against both.

41. During the course of his submission the Defendant has referred us to a few rules of court, authorities and ordinances other than those I have already mentioned. I do not mean to be discourteous when I say that I have found in them no help in the formulation of my conclusion.

Damages

42. There only remains the question of the level of mesne profits, together with that of interest payable thereon and costs.

43. The learned Judge took as a starting point the rent payable by Annette until the 14th December 1983. He assumed that in normal circumstances the Plaintiff would at that time have applied for and been granted an increase, which the Judge thought would have been at least $500. He assumed that there would have been a similar increase again in December 1985 and he made his award accordingly, payment to commence as from the 15th September 1983.

44. With every respect to the learned Judge that date cannot be correct, for until the Plaintiff obtained the termination of Annette's tenancy on the 5th March 1985 the Plaintiff had no right to possession and could not have maintained an action for trespass.

45. Mr. Chain however seeks to uphold the Judge's order, at least to some extent, on the ground that by the 5th March, and by one means or another Annette's tenancy had already come to an end. The first means suggested is surrender by operation of law. The possibility that a tenancy within the protection of Part 2 of the Ordinance can be so surrendered is supported by authority⁽³⁾. It occurred in the present instance, says Mr. Chain, because Annette abandoned her tenancy and the Plaintiff accepted the position. For the purposes of the argument I am prepared to accept that Annette did abandon her tenancy at some time before the Defendant moved in. The question is whether the plaintiff subsequently accepted that. Reliance is placed upon 4 letters. The first is by the Plaintiff's former solicitors and is dated the 19th December 1983. It is addressed to the Defendant and requires him to vacate the flat under threat of legal proceedings. I note in passing that it expressly refers to Annette as "the rightful tenant". The second letter was written to Annette by the Plaintiff itself. It is with respect not in the clearest of terms but appears to assume that Annette still had possession or control of the flat. The next letter of the 20th June was sent by the Plaintiff's present solicitor to the Defendant and threatened to go against him in trespass. That of course would not be possible if Annette's tenancy was still in existence and so it is suggested that the Plaintiff must have accepted that it was not. However as the same solicitors' letter to Annette one month later clearly accepted her still to be the tenant, and that as 3 months after that, and presumably on their advice, the Plaintiff brought proceedings against her in the Lands Tribunal, it seems to me with respect that the letter of the 20th June represented no more than a misconception of the Plaintiff's position. In my judgment Annette's tenancy was at no time surrendered by operation of law.

46. Mr. Chain next has recourse to the common law doctrine of relation back, which establishes that, if I may quote from Ocean Accident and Guarantee Corporation v. Ilford Gas Company ⁽⁴⁾, to which he referred us -

47. It is suggested that the Plaintiff's right to enter accrued as soon as Annette parted with possession to the Lees. Of course in one sense that may have given the Plaintiff a right to re-enter but until it did so her tenancy continued and whoever might have been there with her permission was in no sense a wrong- doer. By the time the Defendant moved into occupation the Plaintiff had no contractual rights of re-entry. His right depended upon a court order.

48. Finally Mr. Chain makes the bold proposition that when the contractual period expired on the 14th December 1983 the tenancy had already lost the protection of Part 2 and was therefore not automatically continued by Section 52(1). The proposition requires reading into Section 51, which provides that a "domestic tenancy", to which Part 2 applies, means a tenancy of "premises let as a dwelling", the additional words, "for the tenant". Thus, as before the end of the contractual tenancy the premises had become the dwelling not of Annette but of Mr. and Mrs. Lee, the premises fell beyond the definition. I see no reason to make that addition to the ordinance.

49. The principle on which mesne profits should have been assessed was recently explained in England by Megaw L.J. in Swordheath Properties v. Tabet ⁽⁵⁾ and accepted by this Court in Attorney-General v. Stephen Chiu Kwok Chun ⁽⁶⁾ -

50. The Judge made no attempt to adopt that approach, although in the circumstances it would not have been easy, for there was not much in the way of evidence to help him. The rateable value, that is the Commissioner of Rating and Valuation's estimate of the ordinary letting value, jumped dramatically from $12,000 per annum in January 1984 to $52,800 as from April of the same year. However Catherine Wong would have been prepared to accept $3,000 as at July 1985 and the rent charged to Mrs. Lee for a larger flat on the 4th floor - the premises has no lift - is still only $3,734. The Plaintiff was content to limit its claim in the Lands Tribunal to $2,600 per month. The Defendant's own assessment in a letter to the Commissioner of Rating and Valuation at the end of 1983 was between $15,000 and $17,000, taking into account the physical state of the premises and construction work in its environment. Some allowance should be made in figures derived from the Plaintiff for the fact that the Plaintiff was only willing to accept tenants of whom its director approved, but even an "open market" tenant would expect some discount for an unlit staircase, inadequate water in the toilet and a defective window. All in all I would propose $3,000 per month as the appropriate figure, to commence, as I mentioned earlier, from the 5th March 1985.

51. The Judge awarded interest on the mesne profits at the rate of 4.5% per annum. It is in my experience unusual for interest to be awarded in cases of this kind, possibly as a result of the authority to which my Lord Kempster J.A. will refer. No special reason is here indicated and I would suggest that the award be deleted.

52. Finally the Judge ordered costs of the two days' hearing in the District Court to be taxed on the High Court scale with certificate for counsel. If my assessment of the value of the flat be correct the action could have concluded within the District Court and so it would, had the Defendant been content to let the District Judge's original decision as to jurisdiction stand. It was only his subsequent reopening of the question that led to the transfer of the action to the High Court, and I would therefore make no variation in the order of the Judge below.

53. For these reasons I would allow the appeal, but only to the extent of varying the order for mesne profits in the ways that I have indicated.

(1)    [1981] 2 All E.R. 48
(2)    [1904] 91 L.T.R. 500
(3)    Hong Kong Investment Co. Ltd. v. Dawstan Ltd. & Another [1985] H.K.L.R. p.1
(4)   [1905] 2 K.B. 493 at 497
(5)    [1979] 1 W.L.R. 285
(6)    unreported 9th April 1985 Civil Appeal 167 of 1984

Kempster, J.A.:

54. For the reasons explained by my Lord Cons V.P. I am satisfied that there are no grounds for interfering with the finding of Mortimer, J. that the defendant was at no time the plaintiffs' tenant or for our making an alternative finding that he was at any time the licensee either of Annette Chan or of the plaintiffs.

55. The plaintiffs had no right to enter upon the flat occupied by the defendant and, consequently, to claim possession or damages for trespass not injurious to the reversion until, on 5th March 1985, they secured an order, by default, in the Lands Tribunal for possession as against their tenant, Annette Chan. Neither this order nor the supporting affirmation of the plaintiffs' assistant manager, Liang She Chieh, made on 11th December 1984, were put before the trial judge. By the affirmation the plaintiffs claim to have become aware that their tenant had parted with possession in about November 1983 and, ostensibly by some process of precognition, already to have ceased to accept payments from the defendant on account of rent as from the 15th September. However, according to the evidence of Catherine Wong at trial it was in September that she, and therefore the plaintiffs, had learned of the defendant's presence and of his claim to be their tenant. Further, and upon what evidence we know not, the plaintiffs went on to assert that, also in breach of covenant, Annette Chan had sublet to the defendant on or about 20th April 1983. The grant by her of a licence to occupy would not of itself have constituted a breach. Lam Kee King v Lam Shes Tong ⁽⁷⁾. Prior to September 1983 the plaintiffs had been at pains to affirm Annette Chan's tenancy albeit her rent and other financial obligations were invariably discharged by third parties.

56. As from 5th March 1985 the plaintiffs, whose title to the premises has not been challenged, became entitled to secure an order for possession as against the defendant and to recover damages for his trespass. "It is in their Lordships' view unnecessary to consider to what extent at the present day, more than a century after the abolition of forms of action, actual entry by the person having title to the land is necessary to found a cause of action in trespass as distinct from ejectment or recovery of possession." per Lord Diplock in Ocean Estates Ltd. v Pinder ⁽⁸⁾.

57. Faced with this probable conclusion and anxious to retain their award of damages as from 15th September 1983 the plaintiffs sought to adopt some of the defendant's arguments and to impeach the Lands Tribunal Order, which they themselves had obtained, on the footing that such tribunal had acted without jurisdiction. They submitted that Annette Chan's tenancy had not continued pursuant to s.52(1) of the Landlord and Tenant (Consolidation) Ordinance after 14th December 1981, when the term expired, since she had not retained possession. It was an exercise doomed to failure. The section in question applies to domestic tenancies, not to domestic tenants, and, prima facie, a continuing domestic tenancy, as defined in s.51, may only be determined as provided in s.52(1). Even if such a tenancy may be surrendered by operation of law otherwise than as provided by sections 52A and 53(1), as held in Hong Kong Investment Co. Ltd. v  Dawstan Ltd.⁽³⁾ and as to which I express no opinion, the thrust of the evidence at trial, accepted by the judge, was that nothing was done by the plaintiffs which could be construed as an assent to any act by or on behalf of Annette Chan inconsistent with the continuance of her tenancy. Alternatively it was submitted that, despite the express terms of s.52 (1B), the continuing tenancy could notionally be deemed forfeited by the plaintiffs so as to allow the recovery of damages from the earlier date pursuant to the doctrine of "trespass by relation". This submission too was unsustainable.

58. The amount of damages recoverable by the plaintiffs is the measure of the value to the defendant of his occupation and to be gauged by market rates. Attorney General v Stephen Chiu ⁽⁶⁾. The rate of $2,600 per month was claimed in Mr. Liang's affirmation and, when the hearing of the present action began in the District Court, Catherine Wong said she would ask for $3,200 but might agree to $3,000 per month. Presumably her answer was given in the context of a lease in similar terms to that granted to Annette Chan. There is also evidence as to the rateable value and as to the rent payable for a larger flat in the same block. Mortimer J. awarded $3,600 per month on the basis of likely permitted increases. But it was for the plaintiffs positively to establish the letting value of the 5th Floor, No. 28 Arbuthnot Road and, in my view, the evidence adduced warranted an award of damages as from 6th March 1985 until possession be given at the rate of $3,000 per month and no more. Further, the award of interest could overcompensate the plaintiffs. Whitwham v Westminster Brymbo Co. ⁽⁹⁾ per Chitty J.

59. Damages may properly be awarded against the defendant albeit the plaintiffs have obtained an equivalent order as against Annette Chan in the Lands Tribunal. The one may be entitled to contribution as against the other. Civil Liability (Contribution) Ordinance sections 5 and 3. The principle of law requiring election by a plaintiff when suing both a principal and an agent has no application to these proceedings.

60. I see no grounds for interfering with the order for costs made below.

61. I agree that the appeal should be allowed to the extent proposed.

(7)    1975 A.C. 247 at p.257
(8)    1969 2 A.C. 19 at p.25
(9)    1896 1 Ch. 894 at p.899