TANG CHI FAI v. DIRECTOR OF LANDS FOR AND ON BEHALF OF LANDS DEPARTMENT

HCAL 391/2019

[2019] HKCFI 2041

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST NO 391 OF 2019

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D E C I S I O N

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1.  This is an application for:

(1)  an extension of time to apply for leave to apply for judicial review of the decision (“the Decision”) of the Director of Lands (“the Director”) to issue a notice to quit dated 18 December 2017 in relation to land leased under a short term tenancy granted by the Government; and

(2)  leave to apply for judicial review of the Decision.

BASIC FACTS

2.  The Applicant’s mother, Madam Liu Lin Hei, deceased (“the Tenant”), had, for many years since about 1965, been operating a factory known as “Kun Fung Bone Crushing Mill” upon the land at Tai Tong Wu in DD 46 (“the Land”), Sha Tau Kok, New Territories, pursuant to various Crown Land permits, licences or short term tenancies.  The last short term tenancy was numbered 441 and dated 11 January 1983 (“STT No 441”), and the area of the Land under lease was about 2,750 square metres.

3.  STT No 441 was for a term of 2 years commencing on 1 January 1981 and thereafter continued on a quarterly basis.  The First Schedule to STT No 441 provides that the purpose for which the Land may be used shall be “A bone crushing factory”.

4.  Special Condition (1) of the Third Schedule to STT No 441 expressly provides as follows:

“The tenancy hereby created may be terminated at the expiration of two years by either party giving to the other at least three months notice in writing to that effect to expire at the expiration of the first two years. In the event of no such notice being given as aforesaid the Tenancy thereafter created may be terminated by either party giving to the other at least three calendar months notice in writing to that effect to expire at any time”.

5.  In about 1992, the Tenant decided to change the use of the Land from “bone crushing” to “lard processing”.  Planning permission for lard boiling on the Land was given by the Town Planning Board on 6 November 1992 subject to various conditions, which were complied with on 21 September 1998.  However, in around 2000, objections were raised by the Sha Tau Kok Rural Committee and the Village Representative of Tai Tong Wu to the use of the Land for the purpose of lard boiling, on the ground that it would cause environmental nuisance to the villagers.  By a letter dated 20 June 2001, the District Lands Office, North (“DLO”) rejected the Tenant’s “Application for Cancellation & Re-issue of Short Term Tenancy No.441 for the purpose of Lard Boiling Workshop”, and advised the Tenant to revert the use of the Land to a bone crushing factory as permitted under STT No 441.  There were subsequent applications made by or on behalf of the Tenant in 2003, 2005 and 2009 to DLO to change the permitted user of the Land, but those applications were not approved by DLO.  Nevertheless, it appears that the Land has been used, and currently is still being used, as a lard boiling workshop.

6.  The Tenant passed away in 2011.  The Applicant applied to DLO for the transfer of STT No 441 into his name after the death of the Tenant.  The application was rejected on the ground that there were subsisting breaches of the short term tenancy[1]. Nevertheless, the Land has, I understand, been occupied, and currently is still being occupied, by the Applicant and/or Kun Fung Lard Limited (of which the Applicant is one of the two directors of the company) since the death of the Tenant.

7.  In or about May 2017, the Government considered the Land to be suitable for allocation to the Drainage Services Department (“DSD”) for use as a site office or for storage purposes in relation to its sewerage treatment works at Shek Wu Hui.

8.  On 18 December 2017, DLO issued to “Ms. LIU Lin-hei (deceased)”, for the attention of the Applicant, a notice to quit (“the NTQ”) requiring the Tenant to deliver up possession of the Land to the Government on 31 December 2018.

9.  The Applicant and/or Kun Fung Lard Limited did not comply with the NTQ.  On 2 January 2019, DLO carried out land enforcement action in respect of the Land by issuing a notice under Section 6(1) of the Lands (Miscellaneous Provisions) Ordinance, Cap 28, requiring unlawful occupation of the Land to cease by 28 February 2019.

10.  On 12 February 2019, the Applicant commenced the proceedings herein for judicial review of the Decision.  On 13 February 2019, the court gave directions for an inter-partes hearing of the present application for (i) an extension of time to apply for leave to apply for judicial review of the Decision, and (ii) leave to apply for judicial review of the Decision.

11.  In view of the uncertainty as to when the Land would become available, DSD withdrew its application to be allocated the Land for its use.  Currently, the Land is regarded by the Government as unleased Government land, and it is the Government’s intention, upon subsequent clearance of the Land, to reserve it as a site for government, community, institutional or non-profit making uses on temporary basis.

DISCUSSION

12.  As stated in paragraph 8 of the Form 86, the basis of the present application for judicial review is that the Decision is Wednesbury unreasonable, for the following reasons:

(1)  the sewerage treatment works at Shek Wui Hui are situated some 15 km from the Land and there are other more suitable sites for storage of related materials for the project;

(2)  the Applicant has been given assurances by DLO that assistance in finding a new site for the Company’s operation would be forthcoming; and

(3)  the Company’s operation performs an important service to the community in that it is the only lard processing plant in Hong Kong, and there would be serious detrimental environmental consequences to Hong Kong if the Company is not able to continue its operation on the Land, or elsewhere in Hong Kong.

13.  In my view, the present application for judicial review can be disposed of on the simple basis that the decision of the Government to terminate STT No 441 and recover the Land is a matter of private law which is not amenable to judicial review.  The law on this point is very well established, and requires no elaboration: see Anderson Asphalt Ltd v SJ [2009] 3 HKLRD 215, at [57] per Andrew Cheung J (as he then was); and Chau Tam Yuet Ching v Director of Lands [2013] 3 HKLRD 169, at [22]-[32] per Lam JA (as he then was, and with whom the other members of the Court of Appeal agreed).  As emphasized in paragraph 23 of the latter judgment, the mere presence of some public elements in the Government’s decision to terminate a land lease, licence or short term-waiver is not sufficient to transform it into a public law decision.  None of the matters relied upon by the Applicant mentioned in paragraph 12 above can turn the Decision into a public law decision, or render it amenable to judicial review.

14.  In any event, I am far from being satisfied that the Director’s decision to issue the NTQ is unreasonable in the Wednesbury sense.  The Land was government land granted to a private individual on a short term basis.  The Director was, it seems to me, entitled to recover the Land for use by another Government department (DSD).  Whether the Land was suitable for DSD’s purposes, and whether there were other more suitable sites for those purposes, were matters for the Director/Government to decide.  It was equally a matter for the Director/Government to decide what (if any) weight ought to be given to the environment consequences, or alleged environmental consequences, arising from the closing down of the Applicant/Company’s lard processing operation on the Land.

15.  For the sake of completeness, I should add that the Director does not accept the allegations mentioned in paragraphs 12(1) and (2) above (see paragraphs 17, 59 and 60 of the Affirmation of Tsang Tsz Tsun of the Lands Administration Office of the Lands Department filed on 25 July 2019).  For the present purpose, it is not necessary to resolve those factual disputes.  Similarly, there are various allegations of breaches of STT No 441 which it is not necessary to resolve in this application.

16.  There is one other matter that I should deal with here.  There are included in Part D of the Hearing Bundle various documents (marked “Not Agreed”) which the Applicant seeks to adduce and rely upon in the present application, including a document titled “Kun Fung Lard Limited - Technical Study of Operation and Treatment of Animal Fat Waste in Hongkong” prepared by P2G Consulting Limited dated 2 August 2019 and some newspaper reports.  These documents have not, however, been produced as exhibits to any affirmation.  I do not consider that those documents assist the Applicant’s application and see no reason why they should be admitted as evidence at this late stage.

17.  In all, the application for judicial review is not reasonably arguable, and has no realistic prospect of success.  That being so, there would be no basis to grant any extension of time to the Applicant to apply for leave to apply for judicial review of the Decision.

DISPOSITION

18.  The application for leave to apply for judicial review is dismissed.  The principles governing an award of costs in an unsuccessful application for leave to apply for judicial review are well settled (see Leung Kwok Hung v President of the Legislative Council (No 2) (2014) 17 HKCFAR 841, at paragraph 17), and do not have to be repeated here.  I consider that the Director should be entitled to be paid his costs in these proceedings, because:

(1)  the delay in making the application is very substantial, and there is no good explanation for the delay (in particular, the suggestion that the delay was due to the processing of the Applicant’s legal aid application and/or he was negotiating with the Lands Department for an alternative site cannot be regarded as any good explanation for the delay);

(2)  the Director has attended the present hearing upon the court’s direction that the questions of extension of time and leave to apply for judicial review should be determined at an inter-partes hearing; and

(3)  the evidence produced by the Director provides the court with the necessary factual background to consider the Applicant’s application.

19.  I therefore make an order that the Applicant shall pay the Director’s costs of these proceedings, to be taxed if not agreed.