THE INCORPORATED OWNERS OF KING YIP FACTORY BUILDING v. LEUNG HO YU RAYMOND

LDMP 1/2017

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 1 OF 2017

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J U D G M E N T

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1.  This is an application by the applicant for an order that the respondent be committed for contempt of court on the ground that the respondent had failed to comply with a court order.

Background

2.  The applicant (“IO”) is the Incorporated Owners of King Yip Factory Building (“Building”) and the respondent is the owner of a property known as Space B (“Space B”) and carparking space No. 7 at Ground Floor of the Building as well as the tenant of carparking space No. 1, 10 and 13 of the Building.  The respondent operates a recycling company under the name of Sea Power Recycle Company Limited (“Sea Power”) at Space B.

3.  By a Notice of Application in Chinese dated 7 August 2014 (“NOA”) in LDBM 213/2014 (“Main Application”) (B/1-12), the IO alleged that the respondent had converted part of the common areas at the ground floor of the Building to his own use in breach of Section 34I of the Building Management Ordinance (“the Ordinance”), by leaving articles in the said common areas.

4.  Attached to the NOA is a ground floor plan (B/7) with the common areas involved marked in green as well as 4 photographs showing articles, metal cages and forklift left at the common areas (B/8-11).  For the purpose of identification at this committal proceedings, the common area outside Space B is named “Green Area 1”, the common area next to the lifts and carparking space No. 10 is named “Green Area 2” and the common area to the right and in front of carparking space No. 16 is named as “Green Area 3” respectively (B/95).  The 4 photographs showed:

(i) Hand trolleys on which stack of carton boxes and recycling materials were put had been left unattended at the common area of the ground floor next to carparking space No. 1 (B/8);

(ii) Various huge metal cages in which stack of carton boxes and recycling materials were put had been left unattended at the passageway and Green Area 2 (B/9-10); and

(iii) A forklift (blue in colour) was parked at Green Area 3 (B/11).

5.  By a consent summons dated 17 November 2014, a consent order (“Consent Order”) (B/13-15) was made against the respondent in the following terms:

“(1) 答辯人或他的租客或代理人或其他代表他的人，須即時移走大廈地下樓層公用部分的雜物及還原受影響的公用部分；

(2) 禁止答辯人或他的租客或代理人或其他代表他的人將雜物放置於大廈地下樓層公用部分”

6.  The Consent Order was served on the respondent by the then solicitors for the IO by post on 9 January 2015 (B/67-70) with penal notice attached.  The effect of the Consent Order is to require the respondent to remove all the stuff he had left at the common areas as well as stopping him from placing any articles at the common areas of the Building.

7.  Warning letters were sent to the respondent complaining his continuous breach of the Consent Order, namely:

(i) Letter from the management company (“Kong Shum”) dated 24 August 2015 (B/97);

(ii) Letter from IO’s then solicitors dated 6 November 2015 (B/72);

(iii) Letter from Kong Shum dated 24 November 2015 with photos attached (B/241-243);

(iv) Letter from Kong Shum dated 5 August 2016 with photos attached (B/244-246);

(v) Letter from Kong Shum dated 2 September 2016 with photos attached (B/247-250);

(vi) Letter from Kong Shum dated 9 May 2017 with photos attached (B/251-253); and

(vii) Letter from Kong Shum dated 2 June 2017 with photos attached (B/254-261).

8.  The respondent had once denied any breach alleged in the reply letter from his solicitors dated 18 November 2015 (B/74).  In the letter dated 3 December 2015 by Sea Power, the respondent acknowledged that upon receipt of the Consent Order and the letters from Kong Shum, the respondent had already stopped placing any article at the common areas (B/76).

9.  Leave was granted by this Tribunal for the IO to issue committal proceedings against the respondent for breach of the Consent Order and the Originating Summons was taken out on 13 February 2017.

IO’s Case

10.  In the Statement pursuant to Order 52 rule 2(2) Rules of High Court filed in support of the ex parte application for leave to issue committal proceedings (“the Statement”) (B/16-19), the IO alleged that the respondent had failed to comply with the Consent Order and was found to have placed articles at the ground floor common areas of the Building on at least the following dates:

(i)	24 November 2016;
(ii)	25 November 2016;
(iii)	26 November 2016;
(iv)	29 November 2016;
(v)	16 January 2017;
(vi)	25 January 2017; and
(vii)	26 January 2017.

   

11.  Mr Lau, the Assistant Property Manager of Kong Shum testified that he visited the Building regularly in the discharge of his duties about once or twice a month.  From his observation since his dispatch to the Building in 2014, the modus operandi of the respondent’s recycling business at Space B is as follows:

(i) Place and park or allowed to be placed or parked on the ground floor of the Building a lorry as well as 3 to 4 metal cages in Green Area 2;

(ii) Place and park or allowed to be placed or parked on the ground floor of the Building another lorry in carparking space No. 15 and 16;

(iii) Place or allowed to be placed trolleys, materials and/or metal cages at Green Area 3;

(iv) Allows waste pickers to leave the trolleys, materials and/or articles for recycling in Green Area 1, next to the 2 lorries mentioned above or place them inside the metal cages;

(v) Forklifts (one in blue and one in red) are used for emptying the articles in the metal cages onto the lorries; and

(vi) Forklifts are parked outside Space B at Green Area 1 and used the socket inside Space B for charging.

12.  3 CCTV cameras, marked as CH6, CH15 and CH16 on the floor plan (B/95), are installed at the ground floor of the Building and Make Worth Electronic Engineering Ltd (“Make Worth”) is the contractor responsible for the maintenance of the same. Mr Lau had requested Make Worth to produce a 1-minute video clip every hour from 9am until 7pm from the 3 CCTV cameras recorded on 24, 25, 26, 28 and 29 November 2016 in the form of a compact disc (“Recordings”) (B/102).  Mr Lau had examined the Recordings and prepared a written record of what depicted at each hour of the Recordings (B/104-111).  From what he saw in the Recordings, Mr Lau confirmed that most if not all the trolleys, metal cages, forklifts, the materials and articles appearing in the Recordings are connected to or involved in the recycling business carried on by the respondent in the Building and situation persisted even after the issuance of the Originating Summons.

13.  Mr Huang, the Senior Property Manager confirmed the observation of Mr Lau, based on Mr Lau’s report as well as his own observations.  Photographs were taken by Mr Huang to show the use of the common areas by the respondent on the following dates:

(i) between 19 December 2016 and 16 March 2017 (B/86-93);

(ii) on 25 January 2017 (B/78-80);

(iii) on 26 January 2017 (B/82-84); and

(iv) on 14 April 2017 (B/113-123).

Respondent’s Case

14.  The respondent had filed 2 affirmations in answer to the IO’s case and had also testified at trial.

15.  In the affirmation dated 16 March 2017, the respondent raised the defence that:

(i) The allegations of 7 occasions in the Statement is vague and unclear and failed to provide particulars and adduce documentary evidence to prove the same;

(ii) Failed to identify which of the photographs produced in the supporting affirmation refers to which of the 7 occasions complained of and the particulars of the allegations in particular the actual length of time the common areas had been used;

(iii) Failed to identify which part of the common areas are involved;

(iv) Lorries would come and go to collect recycled items for his business and such activities were of a temporary use of the common areas for loading and unloading purpose;

(v) The lorry bearing the name “Trust Recycle Co.” depicted in some of the photographs (B/82-83) is not related to the respondent or Sea Power and may be in use by other occupiers of the Building for the collection of rubbish or abandoned items for recycling purpose; and

(vi) Doubted the legality of the IO’s decision of commencing committal proceedings against him with resolutions passed at meeting of the management committee dated 10 December 2015.

16.  In his 2^nd affirmation which is filed in reply to the affirmation of the IO’s witnesses, it is said that:

(i) The IO is trying to make good its defective application by filing the affirmations from its 3 witnesses;

(ii) The evidence by Mr Lau that there is no other company in the Building operating similar recycling business cannot be true (citing the Trust Recycle Co. whose name shown on the lorry);

(iii) Photos produced by the IO clearly show the other parts of the ground floor of the Building are and were at the material times occupied by other users;

(iv) He is entitled to use the carparking spaces which are in his control and occupation for loading and unloading the recycled items;

(v) Mr Lau’s subjective reading and understanding of what had been shown in the Recordings should be disregarded;

(vi) Photos taken by Mr Huang only showed ongoing business operations; and

(vii) The Recordings did not record every second of the day.

17.  At trial, the respondent confirmed that:

(i) There is no other recycling business operating inside the Building except him;

(ii) No dispute with the content of the Recordings;

(iii) The recycling materials that he collected were mainly papers including carton boxes and newspapers;

(iv) The 2 forklifts, some of the huge metal cages, hand trolleys, carton boxes and recycling papers as shown in the photos and the Recordings were all belonged to him;

(v) Huge metal cages, hand trolleys, forklifts, carton boxes and recycling papers were placed at the common areas of the ground floor of the Building as shown in the photos and the Recordings;

(vi) The metal cages placed were to collect and store recycling newspapers collected from waste pickers before they were being taken away sometime later;

(vii) All paper recycling materials collected will be loaded onto the lorry directly by hand and will not be placed at the common areas or into the metal cages, forklift will only be used if the recycling materials were too heavy and to lift the metal cages full of recycling materials onto the lorry;

(viii) The lorry was parked next to the loading bay at Carparking space No. 13 and will be driven away when it was full, usually 2 times per day; and

(ix) His use of the common area is only for brief moments of loading and unloading.

Legal Principles

18.  The burden is on the plaintiff to prove the defendant’s contempt beyond reasonable doubt: Kao, Lee & Yip v Donald Koo Hoi Yan and ors (2009) 12 HKCFAR 830, §30.

19.  In Hao Xiaoying v Wong Yiu Lam William and ors, HCMP 1968/2014, 2 March 2015 at §33, Anthony Chan J laid down the proper approach in committal for civil contempt for breach of a court order:

(i) What is the proper meaning of the court order?

(ii) Whether the defendant had in fact breached the court order so construed; and

(iii) Whether any failure to comply with the court order was accompanied by the state of mind necessary to establish punishable contempt.

20.  It is the duty of the defendant to find out the proper means of obeying the order: Kao, Lee & Yip (§23).  No order will be enforced by committal unless it is expressed in clear, certain and unambiguous language: Kao, Lee & Yip (§23).  Any ambiguity in the order will be construed in favour of the alleged contemnor.

21.  It is sufficient to prove that the defendant’s conduct was intentional in the sense that it was conscious and voluntary. It is not necessary to prove a contumacious intent on the part of the defendant, or that the defendant appreciated that he breached the order, and it would not be sufficient to negate liability where the defendant did not know or believe that his deliberate activities amounted to a breach: Hao Xiaoying (§37).

Discussion

22.  It is clear from the Main Action what is the allegation of the IO against the respondent, with floor plan marking the common areas involved as well as photographs depicting the alleged breach.  The Consent Order was being made with the consent of the respondent so it can be taken that he had no dispute as to the alleged conduct in support of the breach of the Ordinance, ie by leaving articles of his recycling business, including miscellaneous items, metal cages and forklifts on the common areas at the ground floor of the Building.

23.  There is no dispute as to the service of the Consent Order on the respondent and the duty was on him to ascertain the meaning of the Consent Order.  The Consent Order aimed at prohibiting the use of the common area at the ground floor by the respondent by leaving any article on it.  There is no ambiguity in the Consent Order and it is in clear and certain terms that the respondent should not leave any article on the common areas at the ground floor of the Building and what sort of articles are being referred to in the Main Action.

24.  As to whether the respondent had in fact breached the Consent Order, I accept the evidence of Mr Lau and Mr Huang which is supported by the Recordings.  It is clear from the Recordings that items like recycling materials, carton boxes, forklifts, metal cages and hand trolleys had been left at the common areas, not just for brief moment of loading and unloading but instead for hours.  Even though the Recordings only showed 60 seconds of each hour, there were occasions that depicted similar articles were being left at the same location of the common areas repeatedly in a day.  The contention by the respondent that he only used the common areas briefly is rebutted by the Recordings.  This cannot be a reasonable use of the common area as provided in the Deed of Mutual Covenant. 

25.  It is apparent from the Recordings that the respondent had converted the common areas at the ground floor of the Building to his business use in keeping and storing the recycling materials and other related tools and equipment as well as for the parking and charging of the forklifts.  And the respondent had also admitted under cross-examination that forklifts, some of the huge metal cages, trolleys, carton boxes and recycling paper depicted in the photographs and the Recordings placed at the common areas belonged to him.  There may well be other articles left at the common area by other owners, this does not exonerate the liability of the respondent and is irrelevant as to whether the respondent had been in breach of the Consent Order.

26.  Furthermore, the respondent had also admitted in his evidence that the conduct complained in the Main Application is same as the allegations in this contempt proceedings and that he had occupied the common areas (Green Area 1-3) by leaving huge metal cages, trolleys, paper recycling materials and forklifts there.  As can be seen from the Recordings, the use by the respondent cannot be considered brief for loading and unloading only.  The recycling materials, be it in metal cages or on trolleys or on the floor, were left unattended with no sign of anyone dealing with them in any way for loading or unloading purpose.  Some of the recycling materials or metal cages were seen being left at the same place for hours.  The Recordings did not show any loading and unloading of the recycling materials as alleged by the respondent.  The existence of numbers of empty metal cages at the common areas is also inconsistent with the use of loading or unloading.  The empty metal cages are clearly for the purpose of collecting and storage of recycling materials.  Neither would it be right to contend that the nature of the business operated by the respondent required the use of common areas for the purpose of keeping and storing of the recycling materials.  On the contrary, the respondent should only make use of Space B for such purpose.

27.  Based on the evidence of Mr Lau and Mr Huang, the photographs and the Recordings produced, I find the respondent had acted in breach of the Consent Order on the 7 occasions named in the Statement and such breach still persisted and the respondent had not purged the contempt.

28.  And there cannot be any dispute that the respondent had intentionally, voluntarily and deliberately placed the articles alleged at the common areas.  He is well aware of the fact that what he had been doing after the Consent Order is exactly the same as alleged in the Main Application.  The IO and Kong Shum had repeatedly reminded him of the breach with photographs attached showing the alleged conduct.  The respondent should have no doubt whatsoever that what he kept doing is something prohibited by the Consent Order yet he had maintained the same conduct. 

Order

29.  I am satisfied beyond reasonable doubt that the respondent had been in breach of the Consent Order by allowing forklifts, huge metal cages, hand trolleys, carton boxes and recycling papers to be placed at the common areas of the ground floor of the Building and was guilty of contempt of court.

30.  Case be adjourned to a date to be fixed by the Listing Officer, with 2 hours be reserved in consultation with counsel’s diary for sentence and for submission on costs.