CHINN WAI WAN VIVIAN v. CHEUNG CODY

LDPE 172/2020

[2020] HKLdT 29

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

APPLICATION NO. LDPE 172 OF 2020

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DECISION
(APPLICATION FOR LEAVE TO APPEAL)

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1.  This is an interlocutory application taken out by the respondent on 7 July 2020 seeking (i) leave to appeal against my Judgment made on 5 June 2020 (“the Judgment”) and (ii) writ of possession of premises be set aside. 

Background

2.  By a tenancy agreement (which is both in English and Chinese) dated 8 March 2019 (“the Tenancy Agreement”), the applicant as the landlord let to the respondent as the tenant the premises at Unit 2, 16/F,  Iplace,  301-305 Castle Peak Road, Kwai Chung, New Territories (“the Premises”) for a term of 2 years from 15 March 2019 to 14 March 2021 at a monthly rent of $6,800 inclusive of management fee, Government rates and Government rent.  As the name of Iplace implies, this is a modern industrial building of recent built.

3.  The Tenancy Agreement is however subject to a break clause as follows as stated at para 4 in Schedule II:

“Notwithstanding anything to the contrary hereinbefore contained, the Landlord /Tenant/either party shall be entitled to terminate this Agreement earlier than as herein provided by serving not less than 1 month(s)’ written notice or by paying 1 month’s Rent in lieu to the Landlord/Tenant/other party provided that the said written notice shall not be served before the expiration of the 11 months of the Term of Tenancy. (ie the Tenant shall rent the Premises for at least 12 months).”

4.  In the Notice of Application filed to the Tribunal on 17 March 2020, the applicant applied for recovery of possession of the Premises and rent as the respondent has failed to pay rent from 15 December 2019, and applied for order for mesne profits to the date of delivery of vacant possession of the Premises and costs.  The Notice of Application also stated that there was balance of arrears of rent at $4,900 for the period from 15 November 2019 to 14 December 2019.

The Opposition

5.  Because of the general adjournment of court proceedings for public health concern since late March 2020, the respondent only filed a Notice of Opposition on 15 May 2020 the particulars of which is summarized as follows:

(1) Since the commencement of the Tenancy Agreement, the respondent received 3 swipe cards from the applicant giving access to all entry doors and lifts of Iplace.

(2) During the term of the Tenancy Agreement, the respondent lost the 3 swipe cards. The respondent was advised by the management office to seek the applicant’s approval and pay $100 each before he could get back the 3 swipe cards.

(3) On 19 February 2020, at around 3:00 pm, the respondent took lift from the Premises (ie 16/F) to LG1, went past LG1 first door towards the second door which provides access to another lift to LG4 which leads to Yip Shing Street (which is on lower level than Castle Peak Road). The second door did not open and the swipe card box blinked and flashed red instead of green, ie the swipe card did not work.

(4) The respondent was trapped between the first door and second door for around 5 minutes before someone came through the first door.

(5) The respondent went back to the ground floor and sought advice from the security guard manager on why the swipe card did not work.  He was told to call the applicant.

(6) The respondent was told by the applicant (or her representative) that he had his rental fallen into arrears and the swipe cards were therefore disabled.

(7) The respondent called the police and later policemen arrived and asked the security office to re-activate all the respondent’s swipe cards. The respondent complained that the policemen refused to arrest the applicant for cancelling the cards without a court order/ judgment.

(8) On 22 February 2020, the respondent found his name was blacklisted as a rogue tenant on the applicant’s facebook account.

(9) On 15 March 2020, the respondent was again trapped on LG1 as before when the applicant cancelled the swipe cards without notice. The respondent waited a while until someone went past and opened the door.

(10) The respondent called the police again but this time the policemen did not ask the security office to re-activate the swipe cards.

(11) From then onwards, the respondent could not go in and out freely without the assistance of the management office.

(12) The respondent alleged the applicant had committed criminal offences against him and sought $3 million for damages but without any particulars of calculation.

Hearing on 5 June 2020

6.  When the hearing took place on 5 June 2020, the respondent did not deny he owed the rents as claimed by the applicant.

7.  The respondent emphatically repeated the incidents he was trapped twice as stated in his Notice of Opposition and requested the Tribunal to punish the applicant.

8.  I explained that it is trite that a tenant’s covenant to pay rent is regarded as independent of all other covenants or obligations under a lease, including, for example, the covenant for quiet enjoyment by the landlord[1].

9.  Also, the covenant for quiet enjoyment would not be broken by impediments to access or use which cause merely temporary or limited inconvenience[2]. The respondent admitted that he could still go out to the streets and back to the Premises with the assistance of the security guard.

10.  And to the extent that the respondent insisted on a counterclaim against the applicant, which is particularly criminal in nature, I explained to him that it is outside the jurisdiction of the Tribunal. This point was indeed acknowledged by the respondent on the 1^st page of his affidavit attached to his Notice of Opposition.

11.  On the other hand, the applicant said she had served a notice of termination dated 7 February 2020 to the respondent suggesting the Tenancy Agreement would expire on 15 March 2020. But as I pointed out to her, this notice was served premature, because it was “served before the expiration of the 11 months of the Term of Tenancy”.

12.  The applicant also alleged that the respondent had breach the user clause of the Tenancy Agreement by residing at the Premises for domestic purpose instead for industrial use.  However, pursuant to Section 58(1) of Conveyancing and Property Ordinance (Cap. 219),

“(1) A right of re-entry or forfeiture under any proviso or stipulation in a lease for a breach of any covenant or condition in the lease shall not be enforceable, by action or otherwise, unless and until the lessor serves on the lessee a notice-

(a) specifying the particular breach complained of; and

(b) if the breach is capable of remedy, requiring the lessee to remedy the breach; and

(c) specifying the compensation, if any, which the lessor requires in respect of the breach,

and the lessee fails, within a reasonable time thereafter, to remedy the breach, if it is capable of remedy, and to make reasonable compensation in money, to the satisfaction of the lessor, for the breach.”

13.  I had also explained to the applicant that under Section 21F of the High Court Ordinance, if a lessor is proceeding by action for the first time to enforce against a lessee a right of re-entry or forfeiture in respect of any land for non-payment of rent, the lessee would be entitled to a relief period not less than 7 days from the date of the order. If the lessee can pay into court all the rent in arrears and the costs of the action (if any), the lessee shall hold the subject of the lease without any new lease. Having said that, I directed that the applicant to re-activate the 3 swipe cards so that the respondent can gain free access to the Premises.

The Judgment

14.  Having heard the submissions by the parties therefore I made the Judgment as follows:      

(1) Subject to paragraph (3) below, the respondent do deliver vacant possession of the Premises to the applicant;

(2) The respondent do pay the applicant arrears of mesne profits comprising

(i) Balance of arrears from 15 November 2019 to 14 December 2019 in the sum of $4,900;

(ii) Arrears of mesne profits from the 15 December 2019 until delivery up of vacant possession, at the rate of $6,800 per month;

(3) If the respondent should on or before 15 June 2020 (“Relief Expiration Date”) pay into the Tribunal all the arrears of rent/mesne profits as stated in paragraph (2) above (including all arrears of rent/mesne profits due on or before the date of payment) the respondent be relieved from the forfeiture incurred herein, and the lease of the Premises be reinstated.

(4) Unless otherwise ordered, all sums ordered to be paid under this judgment shall be paid into the Tribunal in cash, by EPS, by cashier orders issued by banks in Hong Kong or by cheques drawn by firms of solicitors in Hong Kong, and such sums received by the Tribunal shall be released to the applicant.

(5) There be no order as to costs.

Respondent’s Interlocutory Application

15.  In the respondent’s interlocutory application filed on 7 July 2020, he attached an affirmation stating as follows:

“(1) The landlord cancelled my access cards which is a breach of our rental contract, and the Judge failed to identify and compensate the tenant.

(2) The Judge did not rule on the tenant’s $13.6K deposit which is still at the landlord’s possession.

(3) The Iplace security guard refuses to let me enter Iplace which is captured on video. Base on the above reasons, the judgment shall be set aside immediately.

In addition, I didn’t get the judgment at all from the judge.”

16.  The hearing of this interlocutory application took place on 6 August 2020.

17.  As regards (1) & (3), I had explained to the respondent during the hearing on 5 June 2020 as stated in para 10 above.

18.  In 黃英對譚炳新, HCMP 2049/2000 (unreported, dated 1 August 2000) and Chan Yin Kwan v Wong Kam Hoi, CACV 223/2007 (reported as [2008] 1 HKCLRT 27) and Ngai Ngok Pang & Another v Lee Syn Yuk, Michelle, LDPD 3030/2012 (unreported, dated 10 May 2013), the courts ruled that the Lands Tribunal does not have jurisdiction to entertain any counterclaim by the respondents.

19.  Even when section 8 of the Lands Tribunal Ordinance was amended in 2008 to award damages solely, as well as in addition to rent and mesne profits, it was explained to the Legislative Council that the amendment did not seek to empower the Lands Tribunal to award damages that may go beyond its jurisdictional limit on the types of cases it can entertain.[3]

20.  More particularly, in Ngai Ngok Pang& Another v Lee Syn Yuk, Michelle, supra, His Honour Judge Ko was of the following view:

“15. The Lands Tribunal may only, in an application for possession or ejectment, make an order for the payment of damages in respect of breach of a condition of the tenancy (see section 8(8) of the Lands Tribunal Ordinance, Cap 17). A counterclaim is generally treated as an independent action (see Hong Kong Civil Procedure 2013, paragraph 15/2/4). Since the respondent is not also counterclaiming for possession or ejection, the Lands Tribunal does not have jurisdiction to entertain her claim for damages.”

21.  During the hearing of the Interlocutory Application on 6 August 2020, the respondent also complained that I had not included my direction to the applicant to re-activate the 3 swipe cards into the body of the Judgment dated 5 June 2020. But as said, this direction was given orally in the hearing on 5 June 2020.[4]

22.  As regards (2) the respondent’s intended ground for appeal, it is trite that the deposit cannot be used for the payment of rental during the term of the tenancy. More particularly, clause 7 of the Tenancy Agreement states as follows:

“… Provided that there is no antecedent breach of any of the terms and conditions herein contained, the Landlord shall refund the Security Deposit to the Tenant without interest within 7 days from the date of delivery of vacant possession of the Premises to the Landlord or settlement of any outstanding payment owed by the Tenant to the Landlord, whichever is later….”

23.  And in accordance with Rule 28 of the Lands Tribunal Rules, the reasons for any judgment, decision or order of the Tribunal may be delivered orally or in writing as the Tribunal shall think fit.

 Leave to Appeal

24.  Under section 11(2) of the Lands Tribunal Ordinance,

“Subject to section 11AA and the provisions of any Ordinance relating to appeals from the Tribunal, any party to proceedings before the Tribunal may appeal to the Court of Appeal against a judgment, order or decision of the Tribunal on the ground that such judgment, order or decision is erroneous in point of law.”

25.  Section 11AA (6) of the Lands Tribunal Ordinance provides that:

“Leave to appeal shall not be granted unless the Tribunal, the Court of Appeal or the registrar hearing the application for leave is satisfied that –

(a) the appeal has a reasonable prospect of success; or

(b) there is some other reason in the interests of justice why the appeal should be heard.”

26.  After considering what the respondent presented in his affirmation supporting his interlocutory application, and after hearing what the respondent supplemented in his oral evidence and submission, I decide that the respondent’s appeal has no reasonable prospect of success, and the respondent failed to satisfy that there is some other reason “in the interests of justice” why the appeal should be heard. 

27.  This is a simple application for recovery of possession and payment of outstanding rent/mesne profit and costs.  Since I do not allow the respondent the leave to appeal, the consequential application by the respondent for setting aside the writ of possession dated 23 June 2020 of the premises is therefore refused.

Conclusion

28.  The interlocutory application by the respondent to seek leave to appeal the Judgment made on 5 June 2020 and set aside the writ of possession dated 23 June 2020 are both dismissed.

Costs

29.  The general rule is that costs should follow the event and the applicant seeks costs. Accordingly, I order that the respondent should pay the applicant the costs of this Application which is summarily assessed at $200.

[1] See Charmway Development Limited v Long China Engineering Limited, HCA 54/2001 (reported as [2001] 3 HKC 515) and more recently Worldwide Flight Services Holdings SA Royal Caribbean Cruises Limited and Neo Crown Limited v Kai Tak Cruise Plaza Limited & Another, CACV 393/2018 (reported as [2019] 4 HKLRD 56).

[2] See Cheong Nin Investment Co Ltd v Tokyo Shop Ltd, HCA 309/2004 (unreported, dated 9 December 2004).

[3] See for instance, the response by the Judiciary to the Bills Committee on Civil Justice (Miscellaneous Amendments) Bill 2007 in September 2007:

http://www.legco.gov.hk/yr06-07/english/panels/ajls/papers/aj1127cb2-430-2-e.pdf

[4] Applicant confirmed that she had re-activate the 3 swipe cards for the respondent on 5 June 2020.