HAPPY DRAGON RESTAURANT LTD v. THE DIRECTOR OF LANDS

CACV 201/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 201 OF 2009

(ON APPEAL FROM LDLR NO. 17 OF 2006)

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REASONS FOR JUDGMENT

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Hon Le Pichon JA:

1. This was an application by the Director of Lands (“the respondent”) for leave to appeal to the Court of Final Appeal from an order of this court dated 30 March 2010. At the conclusion of the hearing leave was refused with costs with written reasons to be handed down which we now do.

Background

2. The claim before the Lands Tribunal (“the Tribunal”) was for compensation due to land resumption, assessed on the basis of a total extinguishment of the applicant’s business which it had operated on land held under various leases.  Compensation fell under two general heads:“permanent loss of business” and “disturbance payments from the permanent loss of business” (respectively “the extinguishment claim” and “the disturbance claim”).  The Tribunal rejected both claims and held that no compensation was payable.  We allowed the appeal and ordered that compensation for disturbance in the sum of $5,337,969 be paid to the applicant within 14 days of the date of the order, with interest at the rate of 1% above prime and that the issue of quantum be remitted to the Tribunal for determination.

The “as of right” ground

3. Mr Ismail who appeared for the respondent submitted that both limbs of section 22(1)(a) of the Hong Kong Court of Final Appeal Ordinance, Cap. 484 apply to the claim such that the respondent is entitled as of right to appeal to the CFA.  Having regard to the judgment of Ribeiro NPJ in China Field Ltd v Appeal Tribunal (Buildings) (No. 1) [2009] 2 HKLRD 135 on the scope of section 22(1)(a), a claim to compensation under section 10(1)(d) the Land Resumption Ordinance, Cap. 124 plainly does not fall within that provision.

4. First, it is not arguable that such a claim is liquidated simply because it has been quantified. Second, although Mr Ismail submitted that the appeal involves the value of a “civil right” of the applicant, namely, his right to conduct business on land without disturbance, so as to fall within the second limb of that provision, I do not agree.  On his analysis, any claim for compensation or damages would involve some kind of civil right.  That approach runs counter to the tenor of the judgment in China Field.

Questions of great general or public importance

5. I make the preliminary observation that no specific questions had been formulated for the court, either in the notice of motion or in the respondent’s skeleton submissions. In my view, it is incumbent on a party who seeks leave under section 22(1)(b) to formulate the question or questions said to be of great general or public importance prior to the hearing of the application.  The discipline is salutary in that it necessarily concentrates the mind of the party making the application by his having to identify and focus on the precise question or questions of great public or general importance said to arise.  It is a matter of regret that it was not done in the present case.

6. Mr Ismail formulated the questions as the hearing progressed.  As recorded, they read:

(1)	Whether or not the Court of Appeal was correct in law in deciding that it was not permissible to consider the Tribunal’s Reasons for Decision handed down on 26 June 2009.
(2)	Whether the Court of Appeal was correct in law in finding that an applicant who did not relocate would not necessarily fail in any disturbance claim.
(3)	Whether the Court of Appeal was correct in law in deciding that it was not open to the Tribunal to use its specialist knowledge, experience and expertise in deciding that it was more likely than not that the applicant would receive much more provisional compensation if it had relocated.
(4)	Whether or not the Court of Appeal adopted a proper approach to the Tribunal’s finding of fact where the perversity ground is alleged.

7. As to the first question, what we held (at § 20 of my judgment) was that where the Tribunal declines to review its decision, the reasons it gives “cannot supplement, alter or qualify the findings of fact” made in the judgment sought to be reviewed.  The objection was to the Reasons for Decision supplementing, altering or qualifying the findings of fact that had been made by the Tribunal in its earlier judgment.  There is a material distinction between that and reasons given by the Tribunal for declining to review its decision.  Accordingly, the question as formulated does not arise.

8. The second question is entirely devoid of merit and raises no issue of great general or public importance.  The disturbance claim represents actual loss suffered by reason of the resumption.  Whether or not an applicant relocates has no bearing or impact on that fact.

9. As to the third question, it is equally devoid of merit.  The issue was not whether or not the Tribunal may use its specialist knowledge, experience and expertise but whether there was or was not evidence to support its finding that it was more likely than not that the applicant would receive much more provisional compensation than the provisional payment of $2,649,600 it had received if it had relocated.

10. As regards the fourth question, having formulated it, Mr Ismail recognised and accepted that it did not involve a question of great general or public importance; rather, it was said to be a matter relevant to the exercise of the court’s discretion under the “or otherwise” ground.

"Or otherwise"

11. Apart from the matter mentioned in question (4) above, the other two matters relied on related to the rate of interest ordered to be paid on the disturbance claim and the rate of depreciation.  But it is to be noted that (a) the respondent never addressed the court at the appeal hearing on the appropriateness or otherwise of awarding interest at 1% above prime, and (b) this court’s attention was never drawn to the ‘evidence’ now relied on concerning the rate of depreciation; rather, the appeal had proceeded on the basis that the only evidence before the court was that summarised in §§36-37 of the judgment.

12. For leave to be granted under the “or otherwise” ground, “exceptional circumstances” must be shown.  In my view, quite apart from the fact that, in general, this would be a matter for the Court of Final Appeal itself to decide, the matters now relied on, whether taken individually or cumulatively, do not constitute “exceptional circumstances”.

13. Finally, I should add that upon this court refusing leave to appeal, Mr Ismail did not seek a stay but, instead, requested that the respondent be given 14 days to comply with § 2(a) of the court’s order of 30 March 2010.  After hearing submissions, it was ordered that payment be made within 7 days of the date of this order.

Hon Stone J:

14. I agree with the Reasons for Judgment of Le Pichon JA.

Hon Lam J:

15. I agree.