FORDTIME INDUSTRIAL LTD v. YIP SHING LAM t/a TRADITIONAL CHINESE NOODLE

LDPE 757/2012

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

APPLICATION NO. LDPE 757 OF 2012

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D E C I S I O N

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Background

1.  This is the application by the respondent by way of summons dated 21 February 2014 for leave to appeal against the decision handed down by this court on 7 February 2014 (“the Review Decision”) in refusing the respondent’s application for a review of my order dated 9 October 2013 (“the Possession Judgment”).

2.  The background to the underlying proceedings and the reasons for the Review Decision and the Possession Judgment have already been set out in the respective judgment and I am not minded to repeat the same here.  For convenience, I shall adopt the same abbreviations in my previous judgments.

3.  In a gist, this case involved a tenancy dispute with the applicant claiming against the respondent for a possession order upon termination of the T/A dated 20 April 2005 between them as well as ancillary order concerning mesne profits and specific performance for the respondent to reinstate the floor slab of the suit premises.  The premises named in the T/A is Cockloft C and there is a remark in the T/A that “both parties were aware of the fact that part of the floor slab of the cockloft had been demolished.  The tenant agreed, on termination of tenancy, to be responsible to rebuild the same and resinstate the floor slab of the cockloft to its original state”.

4.  For the Possession Judgment, it consists of the following order :

(a) the respondent should deliver vacant possession of Cockloft C to the applicant;

(b) the respondent should pay the applicant mesne profits from 1 May 2012 till delivery up of vacant possession;

(c) application for specific performance be dismissed;

(d) costs of this application be to the applicant, to be taxed at District Court scale if not agreed, with certificate for counsel.

5.  On 5 November 2013, the respondent takes out an application for review under section 11A of the Lands Tribunal Ordinance (“LTO”).  The grounds for the application for review are :

(a) there is no specific findings by this court as to whether the floor slab and Cockloft C did exist at the time of entering into the T/A;

(b) findings of other circumstantial evidence to point to the existence of Cockloft C at the time of the T/A or at any other time  are erroneous;

(c) since Cockloft C did not exist in 2005, there was no physical “premises” within the meaning of the LTCO for the Lands Tribunal to adjudicate the dispute; and

(d) the doctrine of tenancy by estoppel could have no operation in this circumstances.

6.  Upon hearing from the parties, the Review Decision was being handed down on 7 February 2014 with the application for Review being dismissed.

Leave to Appeal

7.  Section 11 (2) of the Lands Tribunal Ordinance (“LTO”) provides that :

“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.”

8.  Section 11AA(6) of the LTO provides that :

“(6) 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.”

9.  The grounds of appeal raised by the respondent can be summarised as follows :

(a) Erred in failing to rule that the T/A was void and/or should not be given effect because of the uncertainty in its subject matter;

(b) Failed sufficiently to appreciate that a cockloft refer to a physical structure which presupposes the existence of a floor slab;

(c) Erred in ordering vacant possession of Cockloft C which is just a void space without exact parameters, but only estimates from the expert;

(d) Erred in finding that this Tribunal has jurisdiction to entertain the applicant’s application and wrongly distinguished the case of Gonwah Properties Ltd v Nam Ah Restaurant & Ors [1987] 3 HKC 371;

(e) Erred in taking into account other circumstantial evidence which is irrelevant; and

(f) Erred in finding that the doctrine of tenancy by estoppels had application in this case.

10.  The respondent’s appeal belongs to the “reasonable prospect of success” category and is not a matter of public interests.  Le Pichon JA in the Court of Appeal said in her judgment in SMSE v KL CACV111/2009 at §17 that :

“Reasonable prospect of success involves the notion that the prospects of succeeding must be ‘reasonable’ and therefore more than ‘fanciful’, without having to be ‘probable’”.

Ground (a) & (b)

11.  It is the submission of Mr. Ho for the respondent that since it is the finding of this Tribunal in the Review Decision that the subject matter of the T/A is Cockloft C with the floor slab being removed, this is tantamount to holding that the subject matter was some void space which was disavowed by the applicant at trial.  Cockloft in its natural ordinary meaning must be referring to a physical structure which presupposes the existence of a floor slab.  The Tribunal has erred in law in failing to rule that the T/A was void and/or should not be given effect because of uncertainty in its subject matter.    

12.  Mr. Siu for the applicant submitted in reply that the finding by the Tribunal is perfectly consistent with the remarks stated in the T/A and the parties to the T/A have expressly stated that the subject matter is Cockloft C without the floor slab, i.e. a physical structure but with the floor slab being removed. In any event, the contention by the respondent that once the floor slab of a property has been removed, it would become a void space or a void space can never form the subject matter of a tenancy agreement is unsupported by any authorities.

13.  I agree with the applicant.  The contention by the respondent that once the floor slab is no longer in existence, the cockloft ceased to exist cannot be right.  As found in §17-24 of the Possession Judgment and §6-7 of the Review Decision, the cockloft is always there but just with the floor slab removed.  Given the terms of the T/A also required the respondent to reinstate the floor slab, there is no uncertainty in the subject matter of the T/A.  Cockloft C did involve a physical structure with walls and ceiling but with the floor slab being removed.

Ground (c)

14.  It is the contention of the respondent that an order of possession must be predicated on the presence of some physical premises or structure in respect of which possession could be delivered.  Relying on the case of Lam Wing Ching & Ors v Chow Kum Wing [1985] 1 HKC 189 and JA Pye (Oxford) Ltd v Graham [2003] 1 AC 419, it is submitted that possession required a sufficient degree of physical control over the property concerned.  And since a judgment for the giving of possession of land may be enforced by a writ of possession pursuant to O. 45 r.3 RHC, definition of “land” in S. 2 of the High Court Ordinance presupposes the existence of something physical.  And an order for vacant possession of a void space is clearly unenforceable by the bailiff’s office.  Hence, it is wrong in law to order delivery of vacant possession of some void space as it would be impossible to enforce and execute such an order.  In any event, the parameters of the purported Cockloft C were uncertain since there is no evidence of the same from the applicant and the evidence of Mr. Tse, the joint expert, in this regard was only estimates and cannot be taken as exact parameters of the space alleged to constitute Cockloft C.

15.  Given my ruling that Cockloft C cannot possibly be a void space, the respondent’s contention under this head has no merits at all.  As for the actual parameters of Cockloft C, this is only raised in the application for Review.  If the respondent is minded to raise such a new issue on review, this court is entitled to deal with it by naming the evidence in support of its own findings in this aspect as now appeared at §8 of the Review Decision. 

16.  It is the evidence of Mr. Tse that the actual parameters of Cockloft C can be ascertained by way of calculation (page 131 Leave to Appeal Bundle) and that the practice within their profession is to draw a line by adding 1 meter from the top of the male lavatory (6.75ft plus about l metre) to determine the surface of the Upper Ground Floor, i.e. 9 ft odd and less than 10 ft (page 133 of Leave to Appeal Bundle).  In any event, it is the evidence of Mr. Tse that he had taken measurement of the height between the staircase landing to the ceiling of the floor where the 4 cocklofts were situated, which measured 2.25 metres and the whole floor are of the same height (page 137 Leave to Appeal Bundle).  From the evidence of Mr. Tse quoted above, it is clear that the actual parameters of Cockloft C can definitely be ascertained and there is no uncertainty in this regard. 

17.  As for the fact that Mr. Tse had once mentioned that the situation at the back of Cockloft C and D may be different from Cockloft A and B (page 138 Leave to Appeal Bundle), this cannot be a finding by Mr. Tse since he had not been able to gain entry into Cockloft C and D. 

18.  As found in §22 of the Possession Judgment, “(I)t would be absurd for the floor slab to be built just for Cockloft B and D but not for Cockloft A and C.  From the description of Mr. Tse about what he saw on the site visit, one will have no difficulty in coming to the conclusion that the 4 cocklofts are there to form another level of the Building.”  And it would be against common sense if the landing of the 4 cocklofts are not of the same height to form another level.  Mr. Tse also testified that the floor slab for all 4 cocklofts should be the same, i.e. at 2.25m (page 137 Leave to Appeal Bundle).

Grounds (d) to (f)

19.  These grounds had been raised and dealt with at the Review application with nothing new raised at this Leave application. 

20.  I stand by my findings in §9-20 of the Review Decision. 

Conclusion

21.  Having considered all the argument and submissions, I found the respondent has failed to show a reasonable prospect of success in the appeal on the grounds raised by the respondent and the application must be dismissed.

22.  Costs should follow the event.   Costs order nisi that costs of this leave application be to the applicant, with Certificate for Counsel, to be taxed if not agreed on party and party basis at District Court scale.  Unless any of the parties applies by summons to vary it, the costs order nisi shall be made absolute upon expiry of 14 days.