CHEUNG LAI MUI, THE EXECUTRIX OF THE ESTATE OF CHEUNG PING KAU AND THE ADMINISTRATRIX OF THE ESTATE OF CHEUNG PING FUK (ALIAS CHEUNG BING FUK) v. CHEUNG WAI SHING AND OTHERS

HCA 1652/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1652 OF 2012

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J U D G M E N T

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A.   BACKGROUND

1.  The main dispute in this action concerns Lot No 1101 in Demarcation District 221 (the “Disputed Land”), lying in the vicinity of the Sha Kok Mei Village, Sai Kung (the “Village”).

A1.   The Parties

2.  The Disputed Land was owned by the late Mr Cheung Tak Ming (“Great Grandfather”).  He passed away in 1934.

3.  The Great Grandfather was survived by 3 sons, namely Mr Cheung Ping Wan (“Wan”), Mr Cheung Ping Kau (“Kau”) and Mr Cheung Ping Fuk (“Fuk”).  Upon the death of the Great Grandfather, the 3 sons became the registered co-owners of the Disputed Land in equal shares (each holding 1/3 share).

4.  All the 3 sons passed away in the 1990s:

(1) Fuk passed away in around 1991/1992.  He remained a bachelor throughout his life, and had no children.

(2) Wan passed away in 1999.  He was survived by a son and a daughter, namely the 1^st and 2^nd defendants.  The 3^rd defendant was the only son of the 1^st defendant.  In other words, the 3^rd defendant was the only grandson and great grandson of respectively Wan and the Great Grandfather.

(3) Kau passed away in 1997.  He was survived by an adopted daughter, namely the plaintiff.

5.  Having said that the 3 sons have passed away already, as of today: –

(1) The 1^st and 2^nd defendants (as the surviving sons and daughters of Wan) are the 1/3 registered owner of the Disputed Land; and

(2) The estates of Fuk and Kau own 2/3 legal title of the Disputed Land, and the plaintiff has made applications to appoint herself as the administratrix and executrix of the estates of Kau and Fuk.

6.  As will be further elaborated below, it is the defendants’ case that there was all along a family consensus/agreement/understanding (the “Common Understanding”) that the 3^rd defendant (being the sole male descendant of the family) could use and own the Disputed Land as his home, and he could build a small house there when he became an adult.

A2.   The Claims, Defences & Counterclaim at a Glance

7.  The plaintiff, as a co-owner of the Disputed Land, seeks an injunction to restrain the erection of a 25 feet high building (“Structure A”) and a single-storey building (“Structure B”) on the Disputed Land and also to compel their demolition, on the basis that they are: –

(1) unlawful, as they are unauthorised structures contravening, inter alia, section 14 and section 23 of the Buildings Ordinance, Cap 123;

(2) dangerous and can cause injuries to lawful visitors to the Disputed Land and also the general public, as Structure A is right next to a public footpath; and

(3) in breach of the Government lease which may lead to re-entry by the Government.

8.  It is salient to note that initially the plaintiff only sued the 1^st and 2^nd defendants, and she only brought claims against the 3^rd defendant when she amended her Statement of Claim in March 2013 (ie 6 months after she had started this action).

9.  In the prayers for relief in her Re-Amended Statement of Claim, the plaintiff seeks the following relief against the 1^st, 2^nd and 3^rd defendants: –

(1) A permanent prohibitory injunction to restrain the 1^st, 2^nd and/or 3^rd defendants from carrying out any building works on Structure A and Structure B on the Disputed Land;

(2) A permanent mandatory injunction to compel the 1^st, 2^nd and/or 3^rd defendants to remove Structure A and Structure B on the Disputed Land and to remove the lock of the gate on the Disputed Land or to supply the plaintiff with access code to the said lock; and

(3) An order for sale of the Disputed Land under the Partition Ordinance, Cap 352.

10.  The defendants’ defence, in gist, is that: –

(1) The 3^rd defendant is the sole beneficial owner of the Disputed Land pursuant to a common intention constructive trust.

(2) The plaintiff is estopped from claiming the relief sought due to (i) proprietary estoppel; (ii) estoppel by standing by, waiver, acquiescence, laches, and/or (iii) promissory estoppel.

(3) In the alternative to (1) and (2) above, the 3^rd defendant will, if necessary, further contend that the plaintiff’s title in the Disputed Land has been extinguished by virtue of sections 7 and 17 of the Limitation Ordinance, Cap 347, and all rights and title of the Disputed Land are vested in the 3^rd defendant.

(4) The 3^rd defendant, being the sole beneficial owner of the Disputed Land, has complete freedom as to what to build on it and to prevent the plaintiff from entering into the Disputed Land.

(5) Since the plaintiff has no interest in the Disputed Land and/or is estopped from enforcing the interest (if any), she is not in a position to seek relief under the Partition Ordinance, and in any event significant hardship would be caused and hence no order for sale should be made.

11.  Further, the 1^st and 2^nd defendants raised a counterclaim against the plaintiff for accounts and enquiry of the rent received by the plaintiff and for 1/3 of the rental income of a house erected on Lot 774 (“House 774”) which is also known as “No 16 of Lane 9”.  The 1^st and 2^nd defendants together hold a 1/3 undivided share of House 774.  The plaintiff grew up in House 774 which was occupied by her grandparents and parents.  She continued to live there after the death of her father (Kau) in 1997 and is now living with her daughter and granddaughter on the Ground Floor.  She leased out the other two floors to derive rental income.  The plaintiff raised adverse possession as her defence to the 1^st and 2^nd defendants’ said counterclaim. 

B.   RELEVANT LEGAL PRINCIPLES

B1.   Common Intention Constructive Trust

12.  A constructive trust will arise in connection with the legal title to property wherever one party has so conducted himself that it would be inequitable to allow him to deny to the other party a beneficial interest in the property acquired.  This be so where: (1) there was a common intention that both parties should have a beneficial interest or where one party should have the sole beneficial interest; and (2) the claimant has acted to his detriment or significantly altered his position in reliance upon that common intention: Halsbury’s Laws of England: Trusts and Powers(5^th Ed) at paragraph 117; see also Mo Ying v Brillex Development Ltd [2015] 2 HKLRD 985, at paragraphs 5.17, 6.11 and 6.12.

13.  The common intention can be express or implied. It can be deduced or inferred objectively from the parties’ conduct: Mo Ying (Ibid) at paragraph 5.17; Stack v Dowden [2007] 2 AC 432 at paragraphs 126, 128; Halsbury’s Laws of England (Supra) at paragraph 117.

B2.   Proprietary Estoppel

14.  As for proprietary estoppel, the requirements are: –

(a) A representation or assurance made to the claimant;

(b) Reliance on it by the claimant; and

(c) Detriment to the claimant in consequence of his/her reasonable reliance.

See: Fung Oi Ha v Fung Pui On, HCA 17/2012 (Judgment of Madam Recorder Lisa Wong SC, as she then was, dated 6 June 2016), at paragraph 107.

B3.   Promissory Estoppel

15.  Similarly, promissory estoppel arises where: –

(a) The promisor and the promisee are in a relationship involving enforceable or exercisable rights, duties or powers;

(b) The promisor, by words or conduct, conveys or is reasonably understoodto convey a clear and unequivocal promise or assurance to the promisee that he will not enforce or exercise some of those rights, duties or powers; and

(c) The promisee reasonably relies upon that promise and is induced to alter his or her position on the faith of it, so that it would be inequitable or unconscionable for the promisor to act inconsistently with the promise.

See:Luo Xing Juan v Estate of Hui Shui See(2009) 12 HKCFAR 1, at paragraph 55.

B4.   Estoppel by Standing By

16.  The principles in relation to the doctrine of estoppel by standing by, silence, inaction, or acquiescence has been succinctly summarised by Cheung JA in Mo Ying (Supra) at paragraph 8.2: –

“1) An estoppel by silence, inaction or acquiescence arises where “a reasonable man would expect the person against whom the estoppel is raised, acting honestly and responsibly, to bring the true facts to the attention of the other party known to him to be under a mistake as to their respective rights and obligations” and this has been approved as the general principle underlying “estoppel by acquiescence”: see Spencer Bower on the Law Relating to Estoppel by Representation (4th ed., 2004) para.III.4.3, at p.48, citing Moorgate Mercantile Co Ltd v Twitchings [1977] AC 890 , 903F (per Lord Wilberforce). See also Lee Bing Chueng v Secretary for Justice [2013] 3 HKC 511 at [40]-[45] (DHCJ Marlene Ng).

2) A duty to speak, such as to found an estoppel on silence will arise in circumstances:

(1) “[w]here a person, having a title or right to property of any kind, perceives that another person is innocently, and ignorant, conducting himself with reference to the property in a manner inconsistent with such right or rights”: see Spencer Bower on the Law Relating to Estoppel by Representation (4th ed., 2004), para.III.4.4(1);

(2) “[w]here an owner becomes aware that someone is attempting to dispose of his property”, and in such circumstances “he is bound to assert his rights and, if he fails to do so, he may be estopped against the disponee”. "His silence may be a representation either that he has no title or that the person dealing with the property has his authority”: see Handley on Estoppel by Conduct and Election (2006), para.3-012; or

(3) “[w]hen anything in order to a purchase is publicly transacted, and a third person, knowing thereof, and of his own right to the lands intended to be purchased, doth not give the purchaser notice of such right, he shall never afterwards be admitted to set up such right to avoid the purchase; for it was an apparent fraud in him not to give notice of his title to the intended purchaser … and in such cases infancy … shall be no excuse”: see Savage v Foster (1722) 9 Mod Rep 35 , 37 (see also Spiro v Lintern [1973] 1 WLR 1002 , 1010F-1011D).”

17.  In Lee Bing Cheung v Secretary for Justice, HCA 1092/2010 (judgment of DHCJ Marlene Ng dated 21 February 2013), it was emphasised at paragraphs 43 and 45 that “…The essence of the relief is to avoid an unconscionable result” and that “…such is the nature of the equity under the doctrine of proprietary estoppel that the true test is whether it will be unconscionable for the defendant to deny that which he has allowed or encouraged the plaintiff to assume to his detriment rather than ‘whether the circumstances can be fitted within the confines of some preconceived formula serving as a universal yardstick for every form of unconscionable behaviour.’ ” (emphasis added)

B5.   Adverse Possession

18.  It is trite law that a claimant has to establish factual possession and the requisite intention to possess (animus possidendi).

19.  Factual possession means sufficient degree of physical custody and control: Lee Bing Cheung (Ibid)at paragraph 33.

20.  Animus possidendi means the 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, so far as is reasonably practicable and so far as the process of the law will allow: Lee Bing Cheung (Ibid) at paragraph 34. It was held in Powell v McFarlane and Another (1979) 38 P. & C.R. 452 at pages 477-478 that “[t]here are a few acts which by their very nature are so drastic as topoint unquestionably, in the absence of evidence to the contrary, to an intention on the part of the doer to appropriate the land concerned.  The ploughing up and cultivation of agricultural land is one such act” and “so too is the locking or blocking of the only means of access.”

21.  Having made a comprehensive review on ample relevant authorities finding adverse possession in cases of the squatter locking gates and controlling access to the disputed land, the learned author concluded that “[i]f the squatter controls the entrance to the disputed land, by keeping the door or gate to it locked and holding the key, that is strong evidence that he has the animus possidendi”: (Jourdan QC, “Adverse Possession” (2^nd Ed.) at paragraphs 13-23 to 13-29.

22.  An intention to own the land is unnecessary for the purpose of establishing animus possidendi: Adverse Possession (Ibid) at paragraph 9.25.  However, a squatter who does believe, erroneously, that he owns the property clearly constitutes the necessary animus possidendi: Adverse Possession (Ibid) at paragraphs 9-38 to 9-41.

23.  The grant of licence is an act of ownership which is adverse to the title of the registered owner of a property: Cheung Yat Fuk v Tang Tak Hong & Others (2004) 7 HKCFAR 70 at paragraphs 8, 16-17 per Bokhary PJ.

C.   CREDIBILITY OF THE PROTAGONISTS

C1.   The Plaintiff

24.  Having carefully observed the plaintiff’s performance in the witness box, I am of the view that she is not a credible or reliable witness.  It is clear that a lot of the allegations stated in her Witness Statements (“WS”) are false, and contradicted by her own admission/oral evidence.  Many aspects of the plaintiff’s testimony were also contradicted by the objective circumstances of this case.  When the plaintiff could not offer an explanation, she would: –

(1) give new evidence which had not appeared in her 4 WS;

(2) put the blame on others, such as the 3^rd defendant and her own solicitors;

(3) give extreme answers, which are highly inherently improbable; and/or

(4) exaggerate her evidence in the hope of boosting her case.

C1(a) No Licenses/Permission

25.  In her WS, the plaintiff alleged that in 2004, the 3^rd defendant sought her permission to build a temporary garden structure on the Disputed Land for testing durability, and she was kind enough to agree.

26.  This allegation was withdrawn during her oral evidence.  During cross-examination, the plaintiff admitted that the 3^rd defendant did not seek her permission or authorisation before constructing the garden features (including the wooden pavilion, the bridge, the fish pond), the two-Storey Structure A, and Structure B etc on the Disputed Land.  She even made a blanket admission that the 3^rd defendant never asked for her permission before he built anything on the Disputed Land.

C1(b) Alleged Conspiracy to Commit Perjury by Making False Affirmation

27.  The plaintiff twice admitted on oath in previous affirmations that Wan, Kau and Fuk were “natural brothers”.  However, during cross-examination, for the first time, the plaintiff alleged that the 1^st and 3^rd defendants “taught” her to make false affirmations, and the purpose of the false testimony was to facilitate future transfer of title.

28.  Thus, even on her own case, the plaintiff is someone who is readily prepared to commit perjury, and her morality is low.  I agree that this court should bear this in mind in assessing her credibility.

29.  What is perhaps more ironic is that the plaintiff’s allegation about colluding with the 1^st/3^rd defendants to lie on oath itself is also a lie.  The plaintiff is simply desperate to “disown” the admissions in the two affirmations.  I agree that (i) there was no reason why the plaintiff’ sallegation was not mentioned anywhere in her 4 WS; and (ii) it is inherently unlikely that the staff of a solicitors’ firm, ie Mr Leung Yip Hong (“阿東”) (“Mr Leung”), would conspire with lay clients to commit perjury (which is of course a serious crime): Nina Kung v Wong Din Shin (2005) 8 HKCFAR 387,at paragraphs 181 to 184; Re H & Others (Minors) Sexual Abuse: Standard of Proof [1996] AC 563, at pages 586-587.

30.  The plaintiff obviously realised that Mr Leung’s involvement (who was said to be a co-conspirator of hers) may prejudice the credibility of her case.  She was smart enough to try to distance himself from Mr Leung.  To this end, during re-examination, the plaintiff said that Mr Leung is no longer involved in the present proceedings.  This is yet another piece of untruth.  As admitted by the plaintiff’s handling solicitor, Mr Leung has been actively involved in these proceedings. For instance,Mr Leung visited various witnesses during 2012 to 2015 to gather evidence.

C1(c) Kau’s Indigenous Right

31.  While the 1^st defendant had mentioned twice that Kau had sold his “indigenous right”, the plaintiff did not make any response in her witness statements.

32.  Surprisingly, she mentioned for the first time in cross-examination that Kau never sold his “indigenous right”, and he wanted to build a small house on the Disputed Land. Whilst the plaintiff cannot explain why these important points were not mentioned in her WS, the plaintiff went on to allege that Kau had in fact applied to build a small house.  However, she was unable to produce any supporting evidence. She could not even say when Kau’s application was made and why it failed.

33.  Realising the glaring absence of documents to support her story, the plaintiff eventually (again) shifted the blame to her solicitors, saying that there must be some documentary evidence kept by her solicitors.

C1(d) Family Photo Taken in 1978

34.  When asked why she was absent in the family photograph taken during Chinese New Year, the plaintiff gave a rather “extreme” explanation, again for the first time: she said the 1^st defendant pushed her out a few seconds before the photo was taken. 

35.  I agree that this is most unbelievable.  When asked if she complained on the spot, she said no.  When asked if anyone else, such as her Grandmother Yu, asked that another photo be taken again, she said no.

C1(e) Relationship with Wan and his family

36.  In her witness statements, the plaintiff very much seized every opportunity to demonize Wan and his family.  She said Kau was in bad relationship with Wan and his family, and there was a high degree of animosity.  The plaintiff also said that the 1^st and 2^nd defendants were both nasty to her, and the 1^st defendant would even attempt to kick her out of her home or push her out of the family photo.

37.  If the relationship was as poor as described by the plaintiff, one asks rhetorically why would the 1^st defendant pay for Kau’s funeral expenses?  Knowing that she was unable to contradict the documentary evidence adduced by the defendants, at cross-examination the plaintiff was forced to admit that the 1^st defendant had immense respect for Kau, and hence the 1^st defendant volunteered to handle the funeral.  Eventually, the plaintiff conceded that Wan and Kau treated each other as brothers.

38.  With a view to convincing the court that the 1^st defendant would counsel her to make false affirmations (paragraphs 27 to 30 above), in her re-examination the plaintiff also said that she trusted the 1^st defendant a lot.  This belated yet disingenuous suggestion is plainly inconsistent with the allegations in her WS that the 1^st defendant was mean and nasty to her.

39.  I agree that these examples further demonstrate that the plaintiff has kept “tailor-making” evidence that suits her agenda.

C1(f)  Right of Way / License Granted to Developer

40.  The plaintiff’s evidence concerning the dealings with the developer/Tsang Yuk May is convoluted and self-contradictory: –

(1) In her first witness statement, she said in 2007 HK$10,000 was paid to her.

(2) In her 2^nd Supplemental Witness Statement, she stated that she negotiated with the developer together with the 3^rd defendant and other lot owners.  She received HK$30,000 for her own use.

(3) During cross-examination, the plaintiff mentioned for the first time that she and the 3^rd defendant each received HK$5,000 from the developer.

(4) Perhaps realising the patent inconsistency, the plaintiff changed her evidence once again in her re-examination, stating that she received HK$30,000 to HK$40,000 from the developer, and gave the 3^rd defendant HK$5,000.

41.  Anyhow, I agree it is unbelievable that the plaintiff would share HK$5,000 with the 3^rd defendant.  The plaintiff’s explanation was that the 3^rd defendant referred the developer to her, and he was her nephew.  This made no sense.  The developer could simply do a land search to find out the registered ownership.  There was no reason why the plaintiff (who was in financial difficult) would share HK$5,000 with the 3^rd defendant.

42.  Moreover, the plaintiff is unable to produce a shred of documentary evidence in support of her oral evidence.  The 3^rd defendant, on the other hand, produced the “Protection Agreement” dated 15 December 2003, on which the plaintiff signed as a witness.

43.  Finally, the plaintiff changed the date of the grant of licence incident from 2007 to 2003 following the change made by the defendants.  This shows that the plaintiff has no personal knowledge whatsoever of the incident and simply rode along the defendants’ case: –

(1) The 3^rd defendant first raised the incident in 2007 in his Defence and Counterclaim.

(2) In the plaintiff’s Reply, the plaintiff also pleaded the same incident as happening in 2007.

(3) The 3^rd defendant amended the date from 2007 to 2003 in his Amended Defence and Counterclaim and gave an explanation for this in his Supplemental Witness Statement.

(4) Subsequently, the plaintiff in her 2^nd Supplemental Witness Statement also changed the date to 2003.

44.  All in all, I agree that the 3^rd defendant’s evidence on this issue makes much more sense.  Since the 3^rd defendant controlled and possessed the Disputed Land, it was natural for the developer to deal with the 3^rd defendant, not the plaintiff.  This also explains why when the 3^rd defendant was reluctant to extend the licence, he and his family were the ones who got assaulted/harassed.

C1(g) The Adulterous Relationship between Wan and Yu Mei Chik (“Yu”)

45.  When asked why Wan became an “adopted son” of the Cheung Family, the plaintiff made a most scandalous allegation that Wan had an adulterous relationship with Yu.  According to the plaintiff, as Fuk unfortunately discovered the incident, he was sent to China.

46.  This surprising yet extreme allegation is a recent concoction. I agree that if what the plaintiff said were true, Fuk/Kau would have despised and hated Wan to the extreme.  The last thing that Fuk/Kau would do was to sign the Succession Conveyance dated 21 June 1978, acknowledging that Wan (who had slept with their own mother) had a 1/3 entitlement to all the ancestral lands left behind by their father.

47.  What is also curious is that whilst the plaintiff made a speech on the alleged adulterous relationship, she could not give a credible reason why Wan became an “adopted son”.

C1(h) Relationship with Fuk

48.  In her WS, the plaintiff said that she lost contact with Fuk from 1966 to 1986.  Curiously, the plaintiff also stated that the last time she saw Fuk was in 1986.  Reading these together, the plaintiff only saw Fuk once from 1966 to 1986.

49.  Knowing this was detrimental to he case, the plaintiff begun to concoct new evidence.  Her evidence was ever-changing.  At first, the plaintiff said in evidence that she saw Fuk for about three times.  Subsequently, the plaintiff said that she met with Fuk for about six times.

50.  Even putting the plaintiff’s case at its highest, she only met Fuk a few times in 2 decades.  It was inherently implausible that Fuk would inform the plaintiff about intimate personal matters, and said to her that she would get all his assets.

C1(i)  No Alleged Agency

51.  Under cross-examination, the plaintiff admitted that the 3^rd defendant built Structures A and B for his own benefit.  The plaintiff unequivocally admitted that Structures A and B were built by the 3^rd defendant for his own benefit and not for the 1^st and 2^nd defendants (“佢自己整俾自己用”; “佢自己去搞, 佢自己去整”; “為自己起嚟做”).

52.  Hence, there is no truth in the plaintiff’s case that the 3^rd defendant built Structures A and B as the 1^st/2^nd defendants’ agent: see Re-amended Statement of Claim, paragraphs 10 to 12.  There is no factual basis to allege agency.

C1(j)  Impossible for Plaintiff to Expect to Build a House on the Disputed Land

53.  With a view to attracting sympathy and explaining why she did not pay House 774’s government rent and rates, the plaintiff emphasised several times that she was under severe financial difficulty.  Indeed, the plaintiff’s impecuniosity is not in dispute.  All her previous jobs were rather unstable.

54.  In the circumstances, it is wholly incredible that back in 2003, the plaintiff would have told the 3^rd defendant that she would build a small house on the Disputed Land, and that the 3^rd defendant must demolish Structure B by then (the “Alleged 03 Conversation”).

55.  Even on the plaintiff’s case, building a small house on the Disputed Land was no more than a remote possibility for the plaintiff.  She admitted that building a house on the Disputed Land was “十劃都未有半撇” and that she could not at the time even afford her meals (“飯都無得開”).  It is thus most unbelievable that the Alleged 03 Conversation has taken place.

56.  More importantly, even assuming that the plaintiff was in a position to “buy” indigenous rights (which was unlawful) and to pay the construction costs (which was financially impossible), the plaintiff was still unable to explain how she could build a small house without seeking the 1^st/2^nd defendants’ consent. Without being able to give a credible answer at all, the plaintiff just said most unreasonably that “我想係邊度起就推冧佢”.  This shows that the plaintiff in fact had not even thought about the matter, and it was simply impossible for her to build a small house on the Disputed Land.

C1(k) Failure to Explain Why Action Not Commenced Against the 3^rd Defendant at First

57.  If the Alleged 03 Conversation existed, the plaintiff would have taken action against the 3^rd defendant at the outset so as to hold him responsible for the express promise.

58.  However, it was not until 5 April 2012 that the plaintiff first wrote to demand that Structure A and Structure B be demolished.  Moreover, this letter was issued to the 1^st defendant, not the 3^rd defendant. I agree that the plaintiff’s only explanation was illogical.  She alleged that when she talked to the 3^rd defendant, he referred her to the 1^st defendant, and vice versa.  If this were true, after consulting legal advice, the plaintiff would surely have issued the letter to all parties.  For no explicable reason, this was never done.

59.  Worse still, the plaintiff only added the 3^rd defendant as a party when she amended the Statement of Claim on 7 March 2013, ie some 6 months after the plaintiff had started this Action on 11 September 2012.  In fact, the Alleged 03 Conversation was only mentioned for the first time at paragraph 52 of the plaintiff’s 2^nd Supplemental Witness Statement dated 5 June 2015.

60.  In the circumstances, the objective circumstances show that the Alleged 03 Conversation was a recent concoction, and it could not have existed. 

C1(l)   Failure to Mention Change of Gate in First Complaint Letter

61.  The plaintiff alleges that she had free access to the Disputed Land in mid-2011.

62.  If this were true, it is difficult to understand why the plaintiff did not mention anything about the gate and her inability to access the Disputed Land in her pre-action letter dated 5 April 2012.  In fact, the plaintiff only took issue about access to the Disputed Land in the “post-action” letter dated 10 December 2012.  This was issued 3 months after the plaintiff had commenced this Action on 11 September 2012.  The plaintiff then amended her Statement of Claim on 7 March 2013 alleging that she was denied access to the Disputed Land.

63.  During re-examination, the plaintiff was unable to come up with any explanation.

64.  Indeed, the plaintiff’s case has been inconsistent in this regard.  In her Amended Statement of Claim, she claimed that the new gate was installed in mid-2011.  Whereas in the letter dated 10 December 2012, she claimed that she could not enter 1101 since a few months ago.  In her oral evidence, she said that the wooden gate (the “Third Gate”) was installed as early as in 2009.  However, the plaintiff said that for some inexplicable reasons, the Third Gate was kept opened.  This was impossible bearing in mind that (as explained the 3^rd defendant), the Third Gate was made of stainless steel and wood with an electric lock that would be triggered automatically.

65.  The objective circumstances show that the plaintiff simply had no access to the Disputed Land at all, and she paid no attention to the features of the Disputed Land (including the gates).  This was probably why she only took issue about access to the Disputed Land and the Third Gate months after the Action had been started.  She only paid attention by then.  This further demonstrates that before this Action was started, the plaintiff did not care about the Disputed Land at all, and she could not have considered herself as a co-owner.

C1(m) Entered the Disputed Land for the Purpose of Visiting the 3^rd defendant

66.  The plaintiff’s evidence as to when and why she would enter the Disputed Land was extremely vague and evasive.  She only managed to say that she would randomly wander onto the Disputed Land to check if there were any fruits to pick and pull a few weeds.

67.  Whilst the aforesaid bare assertions made little sense, the plaintiff further admitted that she did not visit the Disputed Land at all from 1997 to 2003.  After 2003, when she became friendly with the 3^rd defendant due to the birth of his son, she would occasionally visit the 3^rd defendant and stay for dinner with the 3^rd defendant’s family.  The plaintiff even said that if the 3^rd defendant did not call her, she would not enter the Disputed Land.  This shows that the plaintiff’s visit to the Disputed Land was invariably linked to the 3^rd defendant.  She entered the Disputed Land for paying visits to the 3^rd defendant’s family as a guest, not in the capacity and belief as a co-owner.

C1(n) Wan, Kau, and Fuk Treated Each Other as Brothers

68.  During cross-examination, the plaintiff alleged for the first time that Kau and Fuk did suggest to her that Wan was not a natural son of the Great Grandfather.

69.  There was no reason why these important matters were not mentioned anywhere in her 4 WS.

70.  Anyhow, in light of the incontrovertible documentary evidence, including the Succession Conveyance dated 21 June 1978, the letter dated 25 March 1997 (to be dealt with below) and the 1^st defendant’s payment of Kau’s funeral expense, the plaintiff was forced to accept that Wan, Kau, and Fuk in fact treated each other as real brothers.

C2.   The 3^rd Defendant’s Evidence

71.  Having had the opportunity to carefully consider his evidence and his demeanour, I agree that the 3^rd defendant is a credible and reasonable witness.  He endeavoured to answer all questions and to give details when requested.  He was also fair enough to make concessions when they are warranted.

C2(a) The Common Understanding

72.  The 3^rd defendant repeatedly emphasised that for the Disputed Land, there was a Common Understanding and it is to be distinguished from other ancestral lands.

73.  The overwhelming evidence shows that the 3^rd defendant has been treating the Disputed Land as his own property, and the Disputed Land is not some future entitlement: –

(1) During his cross-examination, the 3^rd defendant consistently drew a distinction between the Disputed Land and other ancestral land.  He said that other ancestral land would only be provided to him in the future if the same were not sold off by the 1^st and 2^nd defendants, and he would only own these land after the 1^st and 2^nd defendants pass away.  In contrast, he said that he already owns the Disputed Land as of now.

(2) The 3^rd defendant pocketed all of the HK$60,000 from the developer for the granting of right of way over the Disputed Land.  He did not see the need to account the same to anyone.

(3) The 3^rd defendant regarded the Disputed Land as his home.  He said it was only natural for him to invest so much as he treated the Disputed Land as his home.  He also mentioned that it was his hobby to improve it, and he built things for himself and his wife to enjoy.

(4) The 3^rd defendant said that in theory, it ought to be the case that even Kau could not enter the Disputed Land without his permission since he was already the “real owner” (“實質擁有人”) before Kau and Wan passed away.  However, he would not prohibit his uncle from entering due to close family relationship.

(5) During cross-examination, the 3^rd defendant maintained that he was the owner (“業主”) of the Disputed Land.  When the court sought clarification from the 3^rd defendant as to how he interpreted the phrase “業主”, he made it clear that although he was not a registered owner on paper, he, in reality, owned the Disputed Land (“實質擁有人”).  Hence, it could not be the case that the 3^rd defendant’s understanding was such that he might only have a hope to get the Disputed Land in the future.

(6) The plaintiff’s counsel further asked the 3^rd defendant why he did not have any share of the sale proceeds of other ancestral land, the 3^rd defendant answered that the Disputed Land was to be distinguished from other land.  Wan, Fuk, and Kau had already said that the Disputed Land was to be given to the 3^rd defendant.  As regard other land, they would only be passed on to the 3^rd defendant if the same have not been disposed of in the future.

(7) When the 3^rd defendant reached an oral agreement with the plaintiff in around 2006 for the plaintiff to be the administrator of Fuk’s estate, he only asked the plaintiff to transfer 2/3 title of the Disputed Land to him and other properties were not mentioned.  This again shows the differential treatment between the Disputed Land and other lands.

74.  I agree that the 3^rd defendant’s evidence makes sense, and is consistent with the objective circumstances.  The above unshaken evidence on the special treatment of the Disputed Land is compelling and highly credible.

C2(b) Works on the Disputed Land

75.  The 3^rd defendant gave an account of various works he did on the Disputed Land, down to details such as the handle of the footbridge in the garden and the stone used for repairing the walls.  The 3^rd defendant’s evidence is uncontradicted and indeed indisputable. 

C2(c) Interaction with Uncle Fuk and Uncle Kau

76.  The 3^rd defendant was able to give vivid and convincing accounts of his interactions with Fuk and Kau.  For instance, the 3^rd defendant would swim and hike with Fuk, and they would also chat and drink tea/beer on the Disputed Land.

D.   FINDINGS ON THE EXISTENCE OF THE COMMON UNDERSTANGING

D1.   The Objective Circumstances

77.  In assessing the credibility of a party’s case, it is important to take into account inherent probabilities and the incontrovertible facts (such as contemporaneous documents): Tradepower (Holdings) Ltd v Tradepower (HK) Ltd(2009) 12 HKCFAR 417 at paragraph140 (per Litton PJ); Hua Tyan Development Ltd v Zurich Insurance Co Ltd [2012] 4 HKLRD 827 at paragraph 27 (per Chung J).

78.  The present case concerns a traditional Chinese family residing in the New Territories.  It is important not to lose sight of the following incontrovertible objective circumstances.  I agree that they all point towards the existence of the Common Understanding.

D1(a) The 3^rd defendant is the only Male Descendent of the Cheung Family

79.  It is now common ground that Wan, Kau and Fuk did treat each other as brothers with equal status and equal entitlement. This incontrovertible fact is borne out by:

(1) the Succession Conveyance dated 21 June 1978 signed by Wan, Kau and Fuk; and

(2) the letter dated 11 October 1971 signed by Kau.

In these contemporaneous documents, Wan, Kau and Fuk unequivocally acknowledged their brotherhood and each other’s’ equal entitlement to the ancestral land left behind by the Great Grandfather. 

80.  In the premises, there is simply no room for the plaintiff to dispute the kinship amongst the parties. The plaintiff cannot deny the incontrovertible fact that the 3^rd defendant was the only male descendent of the Cheung Family.  It was natural and understandable that senior members of the family were fond of the 3^rd defendant. 

D1(b) The Disputed Land is Unique, and it is at a Special Location

81.  It is pertinent to note that unlike other ancestral land, the Disputed Land is located in front of Lot 1099 (where the 3^rd defendant’s family lived).  Naturally, the 3^rd defendant spent a lot of time on it since childhood. This is the place where the 3^rd defendant was raised and where he grew up.  It made sense for senior members of the Family to agree that the 3^rd defendant should own the Disputed Land, and build a house thereon.  The Common Understanding was hardly surprising.

D1(c) The Incontrovertible Documents

82.  The Consent Statement dated 25 March 1997 (“the 97 Consent Statement”) is a piece of very compelling documentary evidence.  In it, Wan and Kau agreed that the 3^rd defendant could build a house on the Disputed Land.  The consent was unconditional.  There was no restriction as to (i) timing; and (ii) location of the house.  Fuk was unable to sign the 97 Consent Statement only because he had already passed away as of March 1997.

83.  The plaintiff is not even in a position to challenge the 97 Consent Statement.  She admitted that Kau would not tell her about many important matters, and she knew nothing about the 97 Consent Statement.

84.  The other very compelling and incontrovertible documents are, of course, (i) the Succession Conveyance dated 21 June 1978; and (ii) the letter dated 11 October 1971 written and signed by Kau.

D1(d) The Extensive Works carried out by the 3^rd defendant on the Disputed Land

85.  The 3^rd defendant has been continuously carrying out extensive works on the Disputed Land since 1992, for example, building Structures A and B, designing/erecting various garden features, digging up the ground to install electricity.

86.  But for the express promises and assurances by the senior members of the Cheung Family, the 3^rd defendant would not have invested and incurred so much time, financial resources, efforts and energy in carrying out all these works to improve the Disputed Land throughout the years.  This demonstrates that the Common Understanding exists, and pursuant to the Common Understanding the 3^rd defendant has been using the Disputed Land as the sole beneficial owner.

D1(e) The “Could-Not-Care-Less” Attitude of the Paper Owners

87.  The attitude of the paper owners is also relevant.  In contrast to the 3^rd defendant’s extensive use and occupation of the Disputed Land, the paper owners (ie the 1^st defendant, the 2^nd defendant and the plaintiff) had almost nothing to do with the Disputed Land throughout the years. They had done nothing to protect/maintain the Disputed Land.  None of them took steps to interfere with the extensive works being carried out by the 3^rd defendant on the Disputed Land, and none of them occupied/used the Disputed Land.  In this connection, it is pertinent to note: –

(1) the plaintiff unequivocally admitted that the 3^rd defendant never obtained her prior consent before he started carrying out the construction/maintenance works.  The plaintiff also admitted that from 1997 to 2003, she did not even visit the Disputed Land at all.  She only started visiting the Disputed Land to see the 3^rd defendant and his family when she became on friendly terms with the 3^rd defendant: see paragraph 67 above.

(2) The 1^st defendant admitted that he was not in a position to stop the 3^rd defendant from carrying out the works in light of the Common Understanding.

(3) The 2^nd defendant also admitted that the Disputed Land was the 3^rd defendant’s “little world (“小天地”)”, and she just had a bare legal title (“掛個名”).

88.  The above shows that the paper owners of the Disputed Land in fact had no control over the land.  They had no actual interest, and they did not care.

D1(f) Conclusion on the Objective Circumstances

89.  In conclusion, I agree that the objective circumstances of this case do point to the existence of the Common Understanding, thus giving rise to a common intention constructive trust and proprietary estoppel in favour of the 3^rd defendant over the Disputed Land.

D2.   Direct Evidence on the Common Understanding

90.  It is, of course, also important to have regard to the direct evidence of the parties on this issue.  In this regard, I have already set out in some detail my view on the respective credibility of the plaintiff and the 3^rd defendant as witnesses.  In fact, I find that the defendants’ witnesses as a whole are honest and reliable on this issue. Their evidence on the Common Understanding is credible and consistent.  It is most unlikely that all the witnesses (many of whom are elders) would conspire together to lie in court on oath.

91.  Importantly, I agree that the 2^nd defendant is a most impressive and compelling witness.  Since the 2^nd defendant’s evidence tantamount to testimony or admission against her own interest, it should be given considerable weight: see Wong Tak Yue v Kung Kwok Wai (No 2) (1997-98) 1 HKCFAR 55, at 69B-E (per Li CJ) and 71E (per Ching PJ).  In fact, the 2^nd defendant had no motive to lie at all.  It was therefore hardly surprisingly that the 2^nd defendant was unshaken under cross-examination.  I agree that there is no reason to reject her evidence.

92.  In contrast, for the reasons set out above, I have concluded that the plaintiff is not a credible or reliable witness.  She is quite unable to adduce any evidence to refute the existence of the Common Understanding.

93.  The plaintiff submitted that there was no record of the Common Understanding.  I agree that this is quite beside the point.

94.  First, the authorities suggest that “when the parties are in a personal relationship (as contrasted with parties in a commercial transaction), it would be unrealistic to expect written records of assurances…”: Chen Tek Yee v Chan Moon Shing, CACV 136/2015 (Judgment dated 29.02.2016)at paragraph 29, per Yuen JA.  The observation must be correct: otherwise, the doctrine of common intention constructive trust and proprietary estoppel would not have developed at all.

95.  Secondly, this case concerns a traditional Chinese family, where filial piety and mutual trust is paramount. Members of the family dealt with each other on the basis of trust, not mistrust.  They could not have envisaged litigation in the future, and they would not have generated records to protect themselves out of the blue.

96.  Thirdly, there is no evidence suggesting that Wan had the habit of making written records.  The evidence shows that Wan would only write to pursue a specific purpose, for example, applying for building a small house on Lot 1099.

97.  Fourthly,members of the Cheung Family have relatively low education level.  None of them was sophisticated commercial people. They would not have created written documents to protect themselves.

98.  Fifthly, in any event, the 97 Consent Statement is the best contemporaneous documentary evidence, and it is very much incontrovertible.

99.  Summarising all the evidence, I accept as a fact that the Common Understanding was at least discussed/mentioned in the following occasions.  Many examples were elaborated in the 2^nd defendant’s oral evidence when she was asked to give details.  In the present case, there was a clear express Common Understanding and/or assurance that the 3^rd defendant should become the sole owner of the Disputed Land and that he could use it as his home.

June 1978	The Common Understanding was discussed after Wan, Kau, and Fuk successfully applied for the succession of Great Grand Father’s land, at Lot 1099 during lunch.  Inter alios the 1st, 2nd and 3rd defendants were also present.
1978	During the 1st defendant’s 31 year-old birthday celebration, the Common Understanding was discussed.
Chinese New Year in 1978	Wan, Kau, Fuk, the 1st defendant, the 3rd defendant, and other family members were present and the Common Understanding was discussed during meals.
1970s-1996	The 2nd defendant went back to the Village since she was sick and the Common Understanding was discussed and conveyed to her by Fuk, Kau, and Yu from time to time.
Chinese New Year (unknown year)	Wan, Kau, and Fuk gathered together to discuss matters relating to the Cheung Family, including House 774 and ancestral land.  The Common Understanding was mentioned again.
1984	Fuk visited the 2nd defendant at her shop in Sai Kung and the Common Understanding was discussed.
1985	Kau talked about the Common Understanding with the 2nd defendant when he visited her at her shop in Kwun Tong.

E.   ALTERNATIVELY, ESTOPPEL BY STANDING BY

100.  By now, there is no dispute that the plaintiff was fully aware of the works carried out by the 3^rd defendant on the Disputed Land.  The only defence is the plaintiff’s alleged granting of licence to the 3^rd defendant to build a garden feature on the Disputed Land and the Alleged 03 Conversation.

101.  Any defence based on license is demolished by the plaintiff’s own admission.  Under cross-examination, the plaintiff admitted that the 3^rd defendant did not seek her permission before constructing the garden features, the two-storey Structure A, and Structure B etc on the Disputed Land.  She even made a blanket admission that the 3^rd defendant had never asked for her permission before he built anything on the Disputed Land.

102.  As to the Alleged 03 Conversation, it is entirely unbelievable: –

(1) As elaborated in paragraphs 57 to 60 above, if the Alleged 03 Conversation did take place and if the 3^rd defendant had made any promises/assurance to the plaintiff, the plaintiff would have issued pre-action letters to the 3^rd defendant and sued the 3^rd defendant at the outset. However, for no explicable reasons:

(i) no pre-action letter was issued to the 3^rd defendant;

(ii) the 3^rd defendant was only sued some 6 months after this Action was started; and

(iii) the Alleged 03 Conversation was only mentioned for the first time in paragraph 52 of the plaintiff’s 2^nd Supplemental Witness Statement.

(2) Since the plaintiff was in severe financial difficulty at all material times, it was financially impossible for the plaintiff to build a house on the Disputed Land.  The plaintiff would not have said anything to the 3^rd defendant about building a small house for herself.

(3) Kau had sold his indigenous right and it was illegal and financially unviable for the plaintiff to purchase such right.

(4) It is peculiar that out of the entire Disputed Land, the plaintiff would insist on building a small house on the specific spot where Structure B now stands.

(5) The plaintiff has not even thought about whose consent to seek and how to build a small house, and she has never sought the 1^st and 2^nd defendants’ consent.

(6) Even on the plaintiff’s oral evidence, the 3^rd defendant only said the kitchen cupboard in Structure B was a sample, not the entire Structure B.  It is odd for the plaintiff to suggest that the 3^rd defendant would promise to demolish the entire Structure B. 

103.  In the circumstances, I agree that the Alleged 03 Conversation is nothing but a concoction.  The plaintiff has clearly stood by and is now estopped from complaining.

F.   IN THE FURTHER ALTERNATIVELY, ADVERSE POSSESSION BY THE 3^rd DEFENDANT

104.  The 3^rd defendant has clearly (i) factual possession of the Disputed Land; and (ii) the requisite animus possidendi for over 12 years.

105.  The 3^rd defendant exercised control over the Disputed Land by building thereon extensively and controlling access, fencing up the Disputed Land and granting licence.

106.  In this connection, the plaintiff admitted that the main entrance is the only entrance to the Disputed Land.

107.  The plaintiff was only able to come up with bare assertion suggesting that the gate was never locked prior to 2011, and hence the Disputed Land was effectively “open to public”.  This is plainly unbelievable and should be rejected: –

(1) This assertion is an affront to common sense.  As pointed out by Madam Lai Mei Chee, what is the point of installing a gate at the entrance if the gate is never meant to be locked?

(2) The fact of changing gates over the years also shows that the 3^rd defendant wanted to maintain and enhance security.  Therefore, it was highly unlikely that the 3^rd defendant would keep changing the gates without locking them.

(3) The defendants’ case is supported by neutral witnesses, namely Tse Chi Man and Kwok Yiu Wing.

(4) The plaintiff’s case is contradicted by the evidence from her own witnesses: (i) Suen Kok Ching admitted that he would yell out the 3^rd defendant’s name to ascertain the 3^rd defendant’s presence before entering the Disputed Land since the land beyond the gate was clearly the 3^rd defendant’s home and he would put the bolt back to its original position to fasten the gate; and (ii) Tse King Shing said he would not have been so daring to enter the Disputed Land to pick fruits without Wan’s permission.

(5) As elaborated at paragraphs 61 to 65 above, if the plaintiff had unhindered access to the Disputed Land prior to 2012, it was inexplicable as to why she did not complain about the gate and her access in the pre-action letter.  What is even more inexplicable was that she did not complain about this in the first version of the Statement of Claim.  This shows that the allegation of free access is a concoction conjured up after the present Action was commenced.

108.  In any event, the question whether the gates were in fact locked is a red herring.  Even if the gates were not actually locked, the 3^rd defendant’s act of erecting the gates thus controlling access to the Disputed Land tantamount to “an unambiguous assertion of control” over the same: see “Adverse Possession” (2^nd Ed.) paragraph 13-29.  This explains why everybody (including Suen Kok Ching, Tse Chi Man and Kwok Yiu Wing) would not even attempt to enter the Disputed Land without first obtaining the 3^rd defendant’s consent.  This is the strongest evidence demonstrating the 3^rd defendant’s factual possession and animus possidendi.

109.  It is also pertinent to note that a mistaken belief of ownership over the land can constitute animus possidendi.

G.   1^st AND 2^nd DEFENDANTS’ COUNTERCLAIM

110.  The plaintiff’s defence to the 1^st and 2^nd defendants’ counterclaim based on adverse possession is bad in law.  The starting point is that possession of one tenant in common is not adverse to the other tenant in common unless ouster is established: Tang Tak Sum v Tang Kai Fong[2015] 1 HKLRD 286 (CA) at paragraph 34.

111.  Tang Tak Sum (Ibid) is a pertinent authority.  At paragraph 39, Cheung JA stated that:

(1) “…The slightest acts done by him [a co-owner] will be found to negative discontinuance of possession because an owner who has the right to possession of land will be readily assumed to have the requisite intention to possess…”. (Emphasis supplied)

(2) The fact that the defendant in that case and his predecessor had collected and received all the rent for their own use without accounting to the plaintiffs was held insufficient to establish ouster or dispossession.

112.  This is indeed the scenario in the present case.  The plaintiff cannot establish ouster by simply showing that she has pocketed all the rental income of House 774.

113.  Further, in the present case, the 1^st and 2^nd defendants have done more than enough to negative ouster.  What they did clearly went beyond the requirement of doing the “slightest acts”: –

(1) In November 2007, the 2^nd defendant attended the hearing at the Small Claims Tribunal on her own behalf and on behalf of the 1^st defendant in respect of House 774’s outstanding government rent and rates.  She was ready to pay their share of outstanding rates and government rent, but the “apportionment” was impossible.  The 2^nd defendant felt that it would be unfair if she had to pay the portion of the plaintiff (“不服氣”).  This shows that the 2^nd defendant still treated herself as a co-owner of House 774 and was willing to shoulder the responsibility of paying 1/3 of the outstanding fees.

(2) The 1^st and 2^nd defendants made written and oral demands to the plaintiff for their share of the rental: (i) the posting of the demand letter on the gate of House 774, and (ii)oral demands when they bumped into her in Sai Kung.

(3) The 1^st and 2^nd defendants gave clear written and oral evidence that they considered themselves co-owners of House 774.

(4) It is common ground that the 1^st and 2^nd defendants have never requested to enter House 774 and got rejected by the plaintiff.

(5) The 1^st and 2^nd defendants insisted that 1/3 of the proceeds of the sale of Lot Nos 1111 and 1113 (ie Fuk’s share) should be utilised towards the construction of the third floor of House 774.

114.  Further, I agree that on her own admission, the plaintiff has failed to establish animus possidendi. The plaintiff in her oral evidence accepts that the 1^st and 2^nd defendants are co-owners of Lot 774 as a piece of land, albeit not the house constructed thereon.  This shows that the plaintiff actually did not consider herself as the sole owner of House 774 and the land on which it is built.

H.   DISPOSITION

115.  For the reasons set out above, I hold that the plaintiff’s claims against the defendants must fail, and the respective counterclaims of the 3^rd defendant and the 1^st and 2^nd defendants should succeed.

116.  Accordingly, as regard the 3^rd defendant, I make the following order: –

(1) A declaration that the 3^rd defendant is the sole beneficial owner of all the interests, rights and/or title in relation to the Disputed Land;

(2) A declaration that the plaintiff is a constructive trustee holding 2/3 interests in the Disputed Land for the 3^rd defendant;

(3) An order that the plaintiff do take all necessary steps to convey, transfer and/or assign 2/3 interests in the Disputed Land to and/or in favour of the 3^rd defendant;

(4) A declaration that the 3^rd defendant is entitled to exercise all rights of occupation and possession of the Disputed Land which the plaintiff would be entitled to exercise as the registered owner thereof;

(5) The claims in this action by the plaintiff against 3^rd defendant be dismissed; and

(6) Liberty to apply.

117.  As regard the 1^st and 2^nd defendants, I make the following orders: –

(1) An account and/or an enquiry in respect of (i) 1/3 of the rental income arising from the 1^st and 2^nd floors of House 774 from 1997 onwards, and (ii) 1/3 of the mesne profits in respect of the ground floor of House 774 from 1997 onwards;

(2) An order that the plaintiff do pay to the 1^st and 2^nd defendants 1/3 of the said rental income in respect of the 1^st and 2^nd floors of House 774;

(3) An order that the plaintiff do pay to the 1^st and 2^nd defendants 1/3 of the said mesne profits in respect of the ground floor of House 774;

(4) The claims in this action by the plaintiff against the 1^st and 2^nd defendants be dismissed; and

(5) Liberty to apply.

118.  I further order that the costs of these proceedings be paid by the plaintiff to the 1^st, 2^nd and 3^rd defendants, such costs are to be taxed if not agreed.

119.  The above order as to costs is nisi and shall become absolute in the absence of any application within 21 days to vary the same.

120.  Lastly, I express my gratitude to counsel on both sides for their helpful assistance in this matter.