ADCO ENTERPRISES LTD v. PETS CENTRAL (HK) LTD

DCCJ4322/2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 4322 OF 2010

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BETWEEN

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D E C I S I O N

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1.  The plaintiff ADCO by the original action is the landlord of the suit property and the 4th defendant is the assistant manager of ADCO. They applied to this court for leave to appeal against my order dismissing their application to strike out the defendant Pets Central’s counterclaim against them.

2.  The grounds for appeal set out in the Notice of Appeal were that I have erred in refusing to strike out the counterclaim when I concluded that the landlord was entitled to summary judgment for damages incurred due to Pets Central’s failure to surrender a portion of the suit premises upon the expiry of the lease between the plaintiff ADCO and ADP, the 2nd defendant, that in my granting of summary judgment I must have been satisfied that Pets Central raised no triable issue in its defence, therefore likewise the counterclaim should be struck out.

3.  Further, ADCO claim that Pets Central’s conspiracy theory is not supported by evidence that Pets Central was not a party to the lease between ADCO and ADP, and because Pets Central became a trespasser at the expiry of the lease, the 4th defendant’s attendance at the suit premises was to exercise the landlord’s rights to recover possession and that her conduct did not amount to nuisance and no excessive force was used even if the alleged assault did take place.  This, of course, is not admitted by either ADCO or Miss Chan.  Furthermore, no damages could be recovered by a trespasser for loss of business against the landlord.

4.  I agree that under the circumstances, the landlord who attended the premises after expiry of the lease, he or/and his agent or servant has full right to enter the premises for repossession purpose.  However, there are more to the allegations than mere attendance to recover premises as alleged by Pets Central in the counterclaim, which is one of the reasons I believe the matter should go for further investigation.

5.  On the basis that the plaintiff ADCO had pleaded in paragraph 13 and 14 of its Statement of Claim that it had recovered possession of the premises on 16 December 2009 pursuant to the Writ of Possession of 16 November 2009.  At paragraph 14 of the Statement of Claim, it further pleaded that ADCO handed over the premises to ULL, the new tenant, on 16 December 2009.  It was on that basis that ADCO claimed damages against Pets Central.

6.  On the other hand, in paragraph 26 of the 4th defendant’s, Miss Chan’s, affidavit of 4 May 2011, she admitted that ADP handed over the vacant part of the premises to ADCO on 29 September 2009.  It was in turn handed over to ULL on 29 September 2009.  It is not known if ULL accepted the handover on 29 September of only part of the premises and whether it was regarded as a proper handover of the suit premises under the new tenancy.  In any event, it was ADCO’s claim that it had compensated ULL for the rental ULL paid for three months commencing on 29 September 2009 that for those three months ULL was not able to occupy the suit premises. 

7.  There certainly are disputes on the evidence as to who was in possession of Section B of the suit premises where the alleged noxious fumes and smell came from.  Was ADCO, the landlord in possession the old tenant ADP? or ULL, the new tenant between 29 September 2009 and 16 December 2009?

8.  As to Pets Central’s Counterclaim, other than the nuisance it pleaded, it also claimed three conspiracies in paragraphs 26 and 27 of the Counterclaim.

9.  The first of the conspiracies is ADCO, ADP, ULL, Miss Chan and D5 to D7 had conspired together, depriving Pets Central of its contractual right to renew the licence when ADP failed to heed Pets Central’s notice to renew the licence and had refused to exercise the option to renew the lease with ADCO.  On this conspiracy alone there are sufficient issues to be investigated.  It clearly raises a triable issue as a result. 

10.  Furthermore, there is the issue of whether Miss Chan’s actions on 29 September 2009 and/or on 1 October 2009 at the suit premises had amounted to interference with Pets Central’s business and created any sort of nuisance and whether she was acting in her own capacity or as an agent or servant of ADCO.

11.  For the above reasons and the reasons set out in my decision of 22 August 2011, I was and I am satisfied that there are triable issues raised in Pets Central’s Counterclaim against ADCO the Plaintiff (the 1^st Defendant by Counterclaim) and the 4th defendant, Miss Chan.  I am not convinced that the Counterclaim should be struck out against them. 

12.  For the aforesaid reason, I do not think the applicant’s appeal has any reasonable prospect of success.

13.  The application for leave to appeal is therefore dismissed with costs, to be taxed if not agreed.