YEUNG WING LUN ALAN v. YEUNG CHUNG KWONG AND OTHERS

HCA 1648/2019

[2023] HKCFI 1134

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1648 OF 2019

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BETWEEN

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D E C I S I O N

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A. INTRODUCTION

1.  The pre-trial review (“PTR”) took place on 3 February 2023 before this Court. This Court raised a number of issues relating to the Plaintiff’s pleaded case. Subsequently, the Plaintiff’s current solicitors came on record on 24 March 2023. They took out two Summonses, which are now before the Court:

(1) Summons dated 24 March 2023 (“Joinder and Amendment Summons”) for:

(a) leave to join the estate of Yeung Chung Sing (楊松星), deceased (“the Father”) as the 2^nd Plaintiff;

(b) the Plaintiff, the only surviving son of the Father, be appointed to represent the estate of the Father, for the purpose of the present proceedings and that the proceedings be carried on; and

(c) leave to amend the Writ of Summons and the Statement of Claim (“SOC”).

(2) Summons dated 28 March 2023 for leave to the Plaintiff to file and serve the 2^nd Supplemental List of Documents (“2^nd LOD Summons”) disclosing new documents.

2.  The trial is due to start on 2 May 2023, 2 weeks from this hearing. Mr Ma, counsel for the Plaintiff, seeks to demonstrate that the present Summonses are necessary for the just resolution of disputes of the parties, that the joinder is necessary, and that the amendments do not introduce new matters but reflect what is already in the pleadings and witness statements. The documents that form the subject matter of the 2^nd LOD Summons are highly relevant to show that over the years the Land had been treated by the government as having 3 portions and hence separately assessed for rates and government rent; and that the Father had spent money on improving the Land.

B. THE PLEADED CASES

3.  The claim concerns the land known as Lot No. 1729 in Demarcation District No. 106, Yuen Long, New Territories (“the Land”). The Father is the eldest brother of D1 to D3 (collectively, “the 4 Brothers”). They are the sons of Mr Yeung Yau Fu (楊又福) alias Yeung Yau Fuk (楊有福) (“the Grandfather”). The 4 Brothers are tenants in common of the Land assigned to them by the Grandfather in 1992 by way of deed of gift.

4.  The Grandfather had been the registered owner of the Land since 1951. The 4 Brothers are tenants in common of the Land assigned to them by the Grandfather in 1992 by way of deed of gift (“the Assignment”).

5.  The Plaintiff’s case is premised on a representation by the Grandfather to the Father, back in 1976, that a portion of the Land (“Relevant Part”) would belong exclusively to the Father for his use, enjoyment and possession (“the Representation”).

6.  In reliance of the Representation, the Father and his family moved into the Relevant Part and spent a considerable sum of money to improve the Land. While he had had exclusive possession over the Relevant Part to the exclusion of the Grandfather and D1-D3, he ceased to have such right over the Remaining Portion.

7.  In 1992, the Grandfather executed the Assignment. Despite the Assignment, the exclusive possession and rights remain as stated in paragraph 6.

8.  The Remaining Portion was subsequently exclusively possessed by D1, D2 and/or D3.

9.  Neither the Grandfather nor any of D1-D3 had ever disputed the Father’s right to exclusive possession of the Relevant Part, whether before or after the Assignment.

10.  In the premises, the Grandfather was estopped from denying the Father’s exclusive right to possess the Relevant Part. Such estoppel was binding on D1-D3, who were not bona fide purchasers for value and were all along aware of the Father’s equity arising from the estoppel before they became the registered owners.

11.  Further, the Representation, the Assignment, the continuous quiet enjoyment of the Relevant Part by the Father since 1976 revealed a Common Intention among the Grandfather and D1-D3 that when the Assignment was made, the Father and D1-D3 were holding the Land on trust for the benefit of themselves in equal shares together with the Father’s exclusive right to possess the Relevant Part.

12.  By a deed of gift dated 4 June 2008, the Father assigned all of his legal and beneficial interests whatsoever in the Land to Madam Sze-To Pik Mi (“Madam Sze-To”).

13.  By a deed of gift dated 15 September 2011, Madam Sze-To assigned all her legal and beneficial interests in the Land to the Plaintiff.

14.  The Father moved away from the Relevant Part in 2016 and passed away in 2018.

15.  Since 2016, the Relevant Part has been occupied by a stranger who claimed to be a tenant (subsequently found to be the son) of D2. Such occupation or letting out was never consented to by the Plaintiff.

16.  The Plaintiff seeks a declaration that D1-D3, together with the Plaintiff, are holding the Land on trust for all 4 Brothers in equal shares together with the exclusive right to possess the Relevant Part on the Plaintiff’s behalf.

17.  D1-D3 deny the Plaintiff’s case. Amongst others, D2 asserts that structures built on the Land were registered with the Lands Department which granted licences to occupy that were not transferable. The Grandfather got 3 licenses.

18.  The Plaintiff had moved out for some time until he returned in 2000 to live at the Land with his girlfriend, Madam Sze-To. Without notifying his Brothers, the Plaintiff assigned his interest in the Land to Madam Sze-To. In 2011, without notice to D1-D3, Madam Sze-To assigned her interest in the Land to the Plaintiff.

19.  As Madam Sze-To had incurred money on renovating the structure(s), at her request and by an agreement on 18 May 2014, D2 and his son were to pay her HK$280,000 by instalments. After the Father was sent to an old-age home, Madam Sze-To got the balance of the unpaid money from D2 and moved out. D2 took the structure(s) for his own use. After the Father died, the Plaintiff suddenly asked for return of the structure(s) to him.

20.  D2 asserted that the Plaintiff did not have locus to sue because he was not Land owner and did not hold a licence over the structure(s). Despite having assigned her interest in the Land to the Plaintiff, Madam Sze-To had received money from D2 and had given him the key to the structure(s).

21.  In the Reply to D2’s Defence, the Plaintiff pleads that the Grandfather’s intention that the Relevant Part would belong exclusively to the Father had been made known to various persons including D1-D3 and other family members. In about 2000, a wall was built to separate the Relevant Part from the other parts. No Defendant had ever complained of being denied access to the Relevant Part. It was D2’s wife who paid Madam Sze-To so that the latter would leave after the death of the Father.

22.  At the PTR, this Court raised the following issues in the Plaintiff’s case as disclosed from the SOC:

(1) The Plaintiff was not a registered owner of the Land. It was not clear how he, in his personal capacity could assert rights against D1-D3.

(2) It was not clear how the Plaintiff could rely on the Representation from the Grandfather to the Father, not to him;

(3) It was not clear how he could allege that D1-D3 were aware of the Representation.

(4) At best, only D2 had leased out the Relevant Part. What wrong had been committed by D1 or D3?

(5) Details of the Representation, Express Agreement or Common Intention were only stated in the Reply and witness statements, but not the SOC.

(6) Detriment suffered by the Father was not clear.

23.  Upon change of counsel, the Plaintiff took out the 2 Summonses seeking to join the Father as a party, to have an order to carry on and to have the SOC redrafted. The Defendants have been served but did not appear at this hearing.

C. JOINDER AND AMENDMENT SUMMONS

C1. Joinder and order to carry on

24.  The Court has power to grant such joinder pursuant to Order 15, rule 4 of the Rules of the High Court, Cap. 4A (“RHC”) where there may be common issues of fact and law between 2 claimants.

25.  At any stage of the proceedings, the Court may order any person to be added, if there may exist an issue arising out of or relating to any relief claimed in the cause or matter which in the opinion of the Court it would be just and convenient to determine as between the intended party and an existing party as well as between the parties to the cause or matter: Order 15, rule 6(2)(b)(ii). The addition of a co-plaintiff may be made where the original plaintiff’s cause of action is defective, eg where the legal owner is required to be added: Hong Kong Civil Procedure 2023, Vol 1, §15/6/2.

26.  The Plaintiff and the personal representatives of the estate or any person interested in the deceased’s estate may, during the period of validity for service of the writ or originating summons, apply to the Court for an order appointing a person to represent the deceased’s estate for the purpose of the proceedings and for an order that the proceedings be carried on by or against the personal representative, as if he had been substituted for the estate: Order 15, rule 6A(4)(a), RHC. Before making an order under rule 6A(4), the Court may require notice to be given to any of the persons having an interest in the estate as it thinks fit.

27.  Where it appears that a deceased person was interested in the matter in question in the proceedings and that he has no personal representative, the Court may, on the application of any party to the proceedings, appoint a person to represent that estate for the purposes of the proceedings: Order 15, rule 15(1). Before making an order under this rule, the Court may require notice of the application to be given to such (if any) of the persons having an interest in the estate as it thinks fit: Order 15, rule 15(2).

28.  At the joinder stage, there is no requirement for an applicant to show merits of his case. The burden is on the party opposing to establish that it is plain and obvious that the plaintiff has no case against the proposed defendant (§§14, 20). The test is whether there is a bona fide claim and a proper question to be tried between the plaintiff and the intended defendant that is necessary or just and convenient for resolution between them as well as between the plaintiff and the defendant in the proceedings. The court will not engage itself in a scrutiny of the applicant’s case, or an adjudication of disputed facts. See Advanced Connection Ltd v Able Technology (Hong Kong) Limited and others [2019] HKCA 1092, §20, Chu JA (as she then was). The principle should equally apply to joinder of a co-plaintiff.

29.  The Plaintiff did not have title and the Representation was not made to him. Subsequent to the Assignment, it was unclear what more interest in the Land the Father had that he could have assigned to Madam Sze-To, who in turn assigned to the Plaintiff. It is thus obvious that without the joinder, the Plaintiff would have no capacity in his own right to sue.

30.  The proposed ASOC contains an alternative claim that the sole 100% beneficial ownership in respect of the Western Portion of the Land together with the structures thereon that had not been transferred to the Plaintiff or Madam Sze-To remain vested in the Father’s estate. There are common issues of fact and law between the Plaintiff’s personal claim and that of the Father’s estate and all reliefs claimed are in respect of the same piece of Land arising out of the same or similar set of facts. On that basis, there exists a bona fide claim and proper questions to be tried between the Father’s estate and the existing parties and it is necessary for the resolution among them to allow the estate of the Father to be joined as the 2^nd Plaintiff.

31.  The Father died intestate in 2018 but no letters of administration have ever been taken out. The Plaintiff is the only surviving son, his sister having passed away. His birth mother was divorced from the Father. The Father has a lawful wife (Madam Chen Xinjie) who has separated from him and has, in writing, given up her rights to apply for letters of administration and her rights in the Land in support of the Joinder and Amendment Summons. The Plaintiff is plainly someone having an interest in the outcome of the proceedings or the estate. He is the most appropriate person to represent the estate of the Father.

32.  There should be an order to carry on if the Father is joined.

C2. Leave to amend

33.  As stated by Ng J in Shenzhen Futaihong Precision Industry Co Ltd v BYD Company Ltd (unrep, HCA 2114/2007, 18 July 2016), at §15:-

“13. … generally speaking, all such amendments ought to be made for the purpose of determining the real question in controversy between the parties to any proceedings or of correcting any defect or error in any proceedings.

14. Leave is readily granted to amend before trial unless it can be shown that the new claim based on the proposed amendment is bound to fail. While the court is entitled to have regard to the merits of the case, it should only do so when the merits are readily apparent, and are so apparent as not to require prolonged investigation.

15. If the proposed amendments are bound to fail, no leave to amend should be granted. In this regard, the court will take the applicant’s proposed pleaded case to the highest.

16. Absent any real prejudice, an application for amendment, albeit late, must be decided upon the general principle that a court of law seeks to adjudicate on the real issues and disputes between the parties and, if possible, technical and procedural rules should not stand in the way of allowing the parties to raise their real claims or defences before the court for adjudication.

17. Where prejudice is claimed, the burden is on the party opposing the amendment to show prejudice. There is no injustice to the opposing party if he can be compensated by appropriate orders as to costs.

18. Lastly, in giving effect to the underlying objectives of the Rules of the High Court, the court shall always recognize that the primary aim in exercising the powers of the court is to “secure the just resolution of disputes in accordance with the substantive rights of the parties”: Order 1A, rule 2(2) of the Rules of the High Court (Cap. 4A) (“RHC”).”

See also Bruce James Stinson v. Gu Ming Gao [2018] HKCA 10 §35, CA.

34.  The Court may allow amendments (even in the course of a trial) to the statement of claim matters already pleaded in the reply if they are already in issue between the parties, dealt with by the parties in their respective evidence and there was no element of surprise or prejudice: Tao Soh Ngun v. HSBC International Trustee Ltd [2018] HKCFI 1495, Wilson Chan J.

35.  The proposed amendments are substantial and essential to complete the Plaintiff’s causes of action, without which he is unlikely to succeed.

36.  Mr Ma seeks to persuade me that the proposed amendments merely reflect what are already scattered in the Reply and the witness statements of the Plaintiff and Madam Sze-To.

37.  I do not agree entirely as there is substantive difference between the existing SOC and draft amended statement of claim (“DASOC”):

(1) There is a new plea that the Representation was not only made to the Father but also to D1-D3 who agreed to it.

(2) The Father relied not only on the Representation but also the Agreement amongst the Father and the 4 Brothers.

(3) A case premised on an agreement may result in contractual rather than equitable relief.

38.  In respect of D1 and D3, there is still no plea in the DASOC as to what wrong D1 and D3 had committed that they had not replied to the letter of demand of the Plaintiff’s former solicitors dated 16 April 2019.

39.  Anyway, if the application to amend had been made earlier in the case management stage, it should have been allowed to enable the just resolution of disputes between the parties and the Father.

C3. Delay in application

40.  As stated in §34 of PD 5.2, a PTR is not an extension of the CMC. The Court expects a case to be ready for trial. Late interlocutory applications may be dismissed on the basis of delay alone.

41.  The Court shall not grant an application to vary a milestone date unless there are exceptional circumstances justifying the variation: Order 25, rule 1B (2) and (3), RHC.

42.  The Summonses were filed grossly late, ie in less than 6 weeks before the trial. The hearing itself was 2 weeks before trial. If leave is granted, it would require the Defendants to acknowledge service, amend pleadings and make further witness statements in answer. These will have the effect of derailing the trial. The Plaintiff does not even assert that there are exceptional circumstances to justify varying the milestone trial dates.

43.  The Plaintiff accepts that these are late applications and that the trial may be derailed, but he puts forth grounds in support:

(1) The amendments arose out of queries of the Court on the Plaintiff’s pleaded case at the PTR and change of counsel post-PTR.

(2) The Plaintiff has relayed “the matters” (presumably meaning the subject matter of the amendments and items of the documents to be produced under the 2^nd LOD Summons) to the previous legal representatives, who did not seem to appreciate their importance and relevance.

(3) D1-D3 have not seriously defended in these proceedings and have failed to file any witness statement. They have not appeared to oppose the Summonses.

44.  With regard to ground (1), I want to emphasize one point. The purpose of the Court in raising issues at a PTR is not to give judicial advice on how a party should improve his case. Rather, it is an important part of the Court’s functions in a PTR to focus the parties’ attention on the real matters in dispute so that the parties can decide if certain issues can be pursued/abandoned and properly prepare legal arguments at the trial. The Plaintiff cannot take the opportunity after the PTR to improve his pleading in such a substantial manner.

45.  Change of counsel is never a good reason for late applications.

46.  With regard to ground (2), it is not clear when the Plaintiffs had relayed “the matters” to his former solicitors.

47.  Mr Ma seeks to persuade me that the proposed amendments merely reflect what are already scattered in the Defence of D1-D3, the Reply and the witness statements of the Plaintiff and Madam Sze-To.

48.  A party shall not in his reply make any allegation of fact, or raise any new ground of claim, inconsistent with his SOC, but he can apply for leave to amend his SOC to plead the allegations or an alternative case: Order 18, rule 10. Witness statements should not depart from the pleaded cases. If they do, the relevant party could apply to amend the pleading as soon as possible.

49.  Even if Mr Ma is correct, pleadings have closed by December 2020 and the last witness statement was filed on 15 August 2022. There had been 7 months for the Plaintiff to seek leave to amend before the PTR.

50.  With regard to ground (3), it is irrelevant. Despite their absence at this hearing, the Court has to, upon granting leave to join a party and to amend, still need to give leave to D1-D3 to file acknowledgement of service, amend their pleadings and to file another round of witness statements. The trial has to be postponed. D1-D3 has to face trial another time.

51.  Further, after the hearing, D1-D3 (through D2) has lodged a set of opening submission, in compliance with the Court’s directions for trial. D1-D3 do take an interest in this action.

52.  More importantly, in these days where the Court’s diary is under great pressure, wastage of Court’s time should not be condoned.

53.  I have balanced the “prejudice” to the Plaintiff if the Joinder and Amendment Summons is dismissed. However, it may be that the Father’s estate, properly advised, may be able to launch a claim against the Defendants where the Court has never adjudicated on the merits. Compared to the gross delay and poor pleading which arose entirely on the Plaintiff’s side, it is the prejudice to the Defendant and wastage of Court’s trial time that should tip the scale against the grant of relief. I therefore dismiss the Joinder and Amendment Summons on the ground of delay.

D. APPLICATION TO FILE 2^nd LOD

54.  As a starting point, litigants have a continuing obligation to give discovery. In the light of such obligation, there is no requirement for leave for a party to file a list of documents by way of discovery. What documents should be included in the trial bundles and placed before the trial judge at the trial of this action is a matter for discussion between the parties and, ultimately, for management by the trial judge if there is disagreement. See Zebra Industries (Orogenesis Nova) Ltd v. Wah Tong Paper Products Group Ltd (27 October 2014, HCMP436/2013), §§85-86, G. Lam J (as he then was).

55.  This principle is supported by the linked principle that a party must not seek to take his opponent by surprise and he must not, by withholding relevant documents, mislead the court: Hong Kong Civil Procedure 2023 Vol 1, §24/2/17.

56.  The documents that the Plaintiff seeks to disclose are:

(a) The Rating and Valuation Department’s Plan, and the relevant correspondence;

(b) Demand note(s) and notice(s) of Rating and Valuation Department since 2010 in respect of the Western Portion, Middle Portion and Eastern Portion of the Land;

(c) The relevant photos taken in 2006 showing the construction of the house in 2006 on the West Portion of the Land;

(d) Various photos showing the Western, Middle Portion, and Eastern Portion of the Land and the boundary walls in between; and

(e) The relevant electricity demand notes from CLP Power Hong Kong Limited.

57.  These documents are relevant but they are produced grossly late. Although some items were not physically in the possession of the Plaintiff or his Father but with the Rating and Valuation Department, the speed at which the Plaintiff’s current firm of solicitors were able to obtain them in March 2023 shows that, with industry, these documents could have been available well before the PTR. The photos have plainly been in the possession of the Plaintiff at all times.

58.  Applying Zebra Industries, the Plaintiff may file the 2^nd LOD. The documents are quite neutral, mostly coming from the government and are not voluminous. The photos merely depict the scenes on the Land. There does not appear to be an element of surprise. I allow the documents to be included in the trial bundles.

E. CONCLUSION

59.  In respect of the Joinder and Amendment Summons, I dismiss it on the ground of gross delay with an order nisi that there be no order as to costs.

60.  In respect of the 2^nd LOD Summons, I give leave to the Plaintiff to file and serve the 2^nd LOD and include the documents in the trial bundle. However, as it was all the fault of the Plaintiff in failing to produce the documents promptly, I make an order nisi that there be no order as to costs.

61.  I thank Mr Ma for his assistance.