LAI SIU WAI LOUIS lawful attorney of 譚翠好 v. HO KING YIN EDWIN AND OTHERS

HCMP 1527/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 1527 OF 2012

(ON AN INTENDED APPEAL FROM DCCJ NO. 4041 OF 2011)

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BETWEEN

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JUDGMENT

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Hon Yuen JA (giving the Judgment of the Court):

1.  This is an application by the 1^st, 2^nd and 3^rd defendants in DCCJ 4041/2011 (“the defendants”) for leave to appeal (out of time) an order of Chow DJ made on 24 April 2012 in respect of costs only (“the costs order”).  There is also an application for stay of execution of the costs order pending determination of the application for leave to appeal.

1.1  The defendants’ application was made on 23 July 2012.

1.2  The plaintiff provided written submissions in opposition on 7 August 2012.

1.3  Directions were given by Kwan JA on 8 August 2012 for the application to be determined on paper.

Plaintiff’s case

2.  Essentially, the background of the matter is as follows. 

2.1  The plaintiff’s case is that he is the attorney of 譚翠好 (Tam Chui Ho/Tan Cui Hao), who is the registered owner of a piece of land in the New Territories.  There have been erected on the land some “erections/facilities” including a guard post (which has been referred to as “the security room”) and an iron gate.    

2.2  Madam Tam leased the land (including the security room and the gate) to a company called Golden Years Investment Ltd (“GY”), which managed a development called Queen’s Park which is adjacent to the land.  The plaintiff is associated with GY in his personal capacity. 

2.3  However a management dispute then occurred between the owners of Queen’s Park and GY. 

2.4  On 13 August 2011, the defendants (who were members of the Owners Committee of Queen’s Park) installed a lock on the door of the security room.

2.5  The plaintiff said that on behalf of Madam Tam, he asked the defendants for the key to the lock, but the defendants refused to provide it.

2.6  On 18 August 2011 the Owners Committee of Queen’s Park resolved to terminate GY’s appointment as manager with immediate effect (even though a notice had been given on 1 August 2011 terminating GY’s services on 1 November 2011).

2.7  On 19 August 2011, the defendants engaged workers to “undergo works” at the security room and gate.  Security guards engaged by the defendants expelled the plaintiff when he went onto the land.

DCCJ4041/2011

3.1  The plaintiff then issued proceedings in DCCJ4041/2011 against the defendants for trespassing on the land and depriving Madam Tam and GY of the use of the land.  It should be noted that it was specifically pleaded that “being deprived of the use and possession of the said security room, [GY] has stopped leasing of the said security room from Madam [Tam], who thereby suffered from loss and damages” (para. 11). 

3.2  The plaintiff issued a writ with statement of claim indorsed on 21 October 2011.

3.3  The relief sought included:     

(1) a declaration that the defendants have been in wrongful possession of the land “from 13th August 2011 onwards”;

(2) an injunction against the defendants from occupying the land;

(3) a mandatory order that the defendants hand over the key(s) to the security room (and gate); and

(4) damages “from the 13^th day of August 2011” to such date when possession of the land is given.

Incorporation of Queen’s Park owners

4.  Three weeks after the writ in DCCJ4041/2011 was issued, on 14 November 2011 the “Incorporated Owners of Queen’s Park” (“the IO”) was incorporated. 

Strike-out application

5.  1  On 29 November 2011, the defendants issued a summons to strike out the statement of claim in DCCJ4041/2011.

5.2  The summons sought to strike out on all the bases set out in Order 18 r 19 Rules of the District Court as well as the inherent jurisdiction of the court (ie no reasonable cause of action; the action is scandalous, etc; the action is prejudicial or embarrassing, etc; and that it was an abuse of the process of the court).

5.3  The striking out application was listed for hearing before Judge Chow on 24 April 2012.

Plaintiff’s application to amend statement of claim

6.  On 17-18 April 2012 the plaintiff

(1) issued a writ with statement of claim indorsed against the IO in DCCJ1276/2012, the relief sought commencing from 14 November 2011 (the date of the IO’s incorporation);

(2) issued a summons to amend the writ with statement of claim indorsed in DCCJ4041/2011, changing the identity of the 4^th defendant, and making amendments so that the pleading was similar to that in DCCJ1276/2012, but with the relief sought commencing from13 August 2011;

(3) issued a summons for leave to file the 2^nd affirmation of the plaintiff.

7.  The plaintiff’s summonses in paras 6(2) and (3) were listed for hearing before Judge Chow on 24 April 2012, being the date fixed for the hearing of the defendants’ strike-out application.

8.  Before the hearing, the parties were able to come to agreement on most matters.  The defendants were prepared not to pursue the strike-out application, but the parties could not agree on the costs of that application which the defendants sought. 

Judge Chow’s decision (24.4.2012)

9.  That was the state of the proceedings when Judge Chow heard the parties on 24 April 2012.  The defendants’ counsel informed the judge that the only basis for the strike-out was thatthe original statement of claim disclosed no reasonable cause of action.

10.  In his decision given the same day, the judge held that the original statement of claim did disclose a reasonable cause of action, and so the defendants could not have succeeded on their strike-out application.  He dismissed the application and he also gave the costs of the application to the plaintiff (ie the costs order).  

Application for leave to appeal

11.  On 22 May 2012 the defendants applied for leave to appeal from the costs order.  The application was out of time.

12.  At a hearing on 11 July 2012, Judge Chow refused leave.  The defendants are now applying to this court for leave to appeal from the costs order out of time. 

Discussion

13.  The defendants face a number of hurdles.  First, the application is out of time.  The affirmation of the 1^st defendant filed on 23 July 2012 seeks to explain the delay by reference to the need to consult a number of owners.  In our view, that is not a satisfactory explanation for the delay.  The defendants were legally represented and should have been advised of the time limits imposed by rules of court, which apply to all litigants.  The mere fact that the defendants are a group of individuals does not by itself justify extending time limits. 

14.  However, of more importance is the merits (or otherwise) of the proposed appeal.  Here the defendants are asking for leave to appeal against a costs order.  It is well-established that costs orders are in the discretion of the court, and that an appellate court would not interfere unless the order was made contrary to principles of law or was “demonstrably flawed”.  Indeed, prior to the Civil Justice Reform, when leave was not required for interlocutory appeals, the only interlocutory appeal for which leave was required was an appeal from a costs order. That showed the court’s recognition of the width of the discretion given to judges when making costs orders. 

15.  The fact that the application is made out of time means that the merits of the appeal have to be even stronger still before this court would be justified in granting leave to appeal.   

16.  The defendants’ intended grounds of appeal (1) and (2) are that Judge Chow failed to take into account the plaintiff’s proposed amended statement of claim when he considered the merits of the defendants’ strike-out application.  The defendants say that if the judge had done so, he would have seen that substantial amendments had been made.

17.  In our view, there is no principle of law that governs how a judge is to go about considering a strike-out application, especially one which was advanced on only one basis - that the original statement of claim failed to disclose a reasonable cause of action.  The issue was a discrete, self-contained one, and it is well-established law that in considering that issue, the judge must assume that all the allegations pleaded are true. 

18.  In any event, having considered both the original and amended statements of claim, we do not consider that the amendment amounted to a “fresh” writ and statement of claim.  The amended statement of claim is far more detailed than the original one (in fact, overly so), but the fundamental allegations of fact giving rise to the claim for relief (in other words, the cause of action) are the same.  In this respect we must make it clear that it is not relevant to this Judgment whether the amended statement of claim itself is or is not capable of being struck out - there has been no such application by the defendants.

19.  Returning to the issues in the present application, having read the original statement of claim, we do not think that the judge was wrong to decide that a reasonable cause of action in trespass had been pleaded.  Madam Tam was the owner of the land on which the security room and the gate were erected.  She leased it to GY.  The defendants entered the land, locked the room and remained in control of it.  When the defendants did so, her lessee GY terminated the lease.  She has suffered loss and damage.  Assuming all those facts were true, that is enough for a case of trespass.  

20.  As for grounds (3) and (5) the defendants argue that it was not pleaded that they had trespassed on the entire piece of land or on any other “erections/facilities” on it.  In our view, it is not necessary for the plaintiff to so plead.  The security room and the gate either took up the entire piece of land, or it did not.  Even if they did not, it would still not be necessary for the plaintiff to plead which route the defendants or their agents used to get to the security room (even assuming the plaintiff had such knowledge).  If the defendants’ case is that they only took a particular route, and that other parts of the land was not used for access, that is for them to plead in a defence and may well be of relevance if and when damages are assessed.  However, that is certainly not a ground to strike-out the statement of claim.  As for the plaintiff’s reference in the statement of claim to “erections/facilities including but not limited to ... the security room ... and gate”, the defendants would of course be justified in requesting further and better particulars, but again that is not a ground to strike-out the statement of claim.

21.  Finally as for ground (4), the defendants argue that since GY was the tenant of the security room and gate on 13 August 2012, Madam Tam could not sue for trespass.  However it is clear from the original statement of claim that the action was for damages for a continuing trespass, and that the lease had been terminated (see para 11 of the original statement of claim quoted in para 3.1 above) before the issue of the writ.  Whether the trespass was actionable from 13 August 2011 or 1 September 2011, there was a cause of action in trespass when the writ was issued on 21 October 2011.  Accordingly that was not a ground for a strike-out either.

Order

22.  By reason of the matters above, we take the view that there was no merit in the application for leave to appeal the costs order out of time. 

22.1  The application is dismissed, and pursuant to Order 59 rule 2A(8) RHC, it is ordered that no party may request this determination to be reconsidered at an oral hearing inter partes. 

22.2  It follows that the application for stay of execution of the costs order should also be dismissed.

22.3  We make an order nisi that the defendants are to pay the costs of the applications to the plaintiff.  If there is no application to vary the costs order nisi within 14 days after the date appearing on this Judgment, the following directions shall apply:

(1) the parties should seek to agree the quantum of costs;

(2) if the parties are unable to agree the quantum of costs within 28 days after the date appearing on this Judgment,

(a) the plaintiff may lodge within 14 days thereafter a skeleton bill of costs for the purpose of a summary assessment of costs;

(b) the defendants may within 14 days thereafter lodge written submissions in opposition to the skeleton bill;

(c) the court will then make a summary assessment of costs.