SUNBROAD HOLDINGS LTD v. ALL OCCUPIERS AND OTHERS

HCMP 1852/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1852 OF 2008

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BETWEEN

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J U D G M E N T

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Introduction

1.  The Plaintiff is, and has since 2000 been, the registered owner of the property (the “Property”) known as the ground floor of the building at No.15 Pak Sha Road, Causeway Bay, Hong Kong (the “Building”), erected on that piece of land known as Sub-Section 1 of Section Q of Inland Lot No.29 (the “Land”).

2.  A plan showing the ground floor of the Building, taken from Annex 2 to the Statement of Claim (the “Plan”), is reproduced and annexed to this Judgment.

3.  The Property is sub-divided into a number of shops currently let by the Plaintiff to various tenants.  The subject matters of this action relate to certain structures coloured “blue” on the Plan (which will be further described below) attached to a part of the external wall of the Property (the relevant part of the wall will hereinafter be referred to as the “External Wall”).

4.  The 3^rd Defendant is a cobbler operating a stall (the “Stall”) located opposite to the External Wall on a scavenging lane at the junction with Yun Ping Road.  Apparently, the 3^rd Defendant has been carrying on his shoe-repairing business at that location since 1957.

5.  The Structures were erected by the 3^rd Defendant.  According to the 3^rd Defendant:-

(1)  In around 1972, he constructed a small metal box (the “Small Metal Box”) on the External Wall for storage of shoes pending customers’ collection and as a show case for leather belts and other goods.

(2)  In around 1984, he constructed a large metal box (the “Large Metal Box”) on the External Wall above the Small Metal Box for the same purpose.

(3)  In around 1986, he constructed a canopy (the “Canopy”) above the aforesaid 2 metal boxes to protect them from sunlight and rain.

(4)  The Small Metal Box, the Large Metal Box and the Canopy make up the Structures complained of by the Plaintiff in this action.

6.  It is not in dispute that the 3^rd Defendant erected the Structures, which are physically attached or affixed to the External Wall, without the consent, licence or permission of the Plaintiff, or its predecessors in title.  It is the 3^rd Defendant’s contention that from around 1972, he has been in exclusive possession of and has been using the External Wall without the consent or licence or permission in whatever form of the owner of the External Wall, such that he has acquired a good title to the External Wall by adverse possession.

7.  In this action, the Plaintiff claims against the 3^rd Defendant for, inter alia, an injunction to restrain the 3^rd Defendant from trespassing upon, or interfering with, the Plaintiff’s possession of the External Wall, and a mandatory order to require the 3^rd Defendant to demolish and remove the Structures and to make good the damage caused to the External Wall by such demolition and removal.

The present application

8.  By a summons dated 17 January 2011 taken out by the Plaintiff pursuant to Order 14 Rule 1, Order 14A Rule 1 and Order 18 Rule 19 of the Rules of High Court and the Court’s inherent jurisdiction, the Plaintiff seeks, inter alia:-

(1)  the determination of a question of law, namely, whether the matters pleaded in paragraphs 7(a) to (d) of the Defence and Counterclaim of the 3^rd Defendant separately or jointly amount to exclusive possession by the 3^rd Defendant of the External Wall;

(2)  an order that judgment be entered against the 3^rd Defendant for the relief claimed in the Statement of Claim, and that the 3^rd Defendant’s counterclaim be struck out.

The Plaintiff’s Order 14A Application

9.  In paragraph 7 of the 3^rd Defendant’s Defence and Counterclaim, the 3^rd Defendant pleads as follows:-

“As to paragraph 7, in respect of the Blue Wall, the allegations therein are denied.

(a) In around 1972, the 3^rd Defendant constructed a small metal box (“the Small Metal Box”) on the Blue Wall to store the shoes pending for customers’ collection and to show some belts and some other goods to customers. Everyday, after the close of business, the 3^rd Defendant would padlock the door of the Small Metal Box.

(b) In around 1984, the 3^rd Defendant constructed a large metal box (“the Large Metal Box”) on the Blue Wall and above the Small Metal Box to store the shoes pending for customers’ collection and to be used as a show box to display goods. Everyday, after the close of business, the 3^rd Defendant would padlock the iron gate and the doors of the Large Metal Box.

(c) In around 1986, the 3^rd Defendant constructed a canopy (“the Canopy”) above the aforesaid 2 metal boxes to protect the boxes from sunlight and rain.

(d) From around 1972 onwards, the 3^rd Defendant has been in possession of and has been using the Blue Wall without the consent or licence or permission in whatever form from the owner of the same.”

10.  It is the Plaintiff’s contention that these facts, even if they can be established at the trial, cannot as a matter of law amount to adverse possession of the External Wall, and the Plaintiff asks the Court to determine this issue of law under Order 14A Rule 1 of the Rules of High Court.

11.  Mr Liu on behalf of the 3^rd Defendant objects to the Plaintiff’s application on the ground that Order 14A Rule 1(1)(b) has application only if the determination of the question of law has the effect of finally determining the entire cause or matter, or any claim or issue therein.  In other words, no matter whether the answer to the question is “yes” or “no”, the entire cause or matter, or any claim or issue, would be finally determined, subject to any possible appeal.  Support for this approach can be found in the judgment of the Court of Final Appeal in B+B Construction Ltd v Sun Alliance and London Insurance Plc (2000) 3 HKCFAR 503 at 507C-508C, per Chan PJ.

12.  In the present case, if the answer to the question of law posed by the Plaintiff is “yes”, i.e. the facts pleaded in paragraph 7 of the 3^rd Defendant’s Defence and Counterclaim can amount to adverse possession of the External Wall as a matter of law, this answer would not finally determine the claim of adverse possession raised by the 3^rd Defendant, because the question of whether the factual averments can be proved remains to be determined at the trial.

13.  I therefore agree with Mr Liu that Order 14A Rule 1 has no application, and I would dismiss the Plaintiff’s application in so far as it is based on that order.

The Plaintiff’s applications under Order 14 Rule 1, Order 18 Rule 19 and inherent jurisdiction of the Court

14.  On one reading of the Plaintiff’s summons, paragraph 2 thereof is dependent on the Court’s determination of the question of law under Order 14A Rule 1 raised in paragraph 1 of the summons.  On that reading, the whole summons should be dismissed in view of my conclusion above that Order 14A Rule 1 has no application to the present situation.

15.  Nevertheless, the parties have proceeded on the basis that the Plaintiff’s applications under Order 14 Rule 1, Order 18 Rule 19 and the inherent jurisdiction of the Court are distinct and separate from the application under Order 14A Rule 1; in other words, they are not necessarily dependent on the Court’s finding in favour of the Plaintiff under paragraph 1 of the summons.  Since I do not consider the 3^rd Defendant to be under any misunderstanding as to the nature or scope of the Plaintiff’s application or that he has suffered any prejudice, I shall proceed to determine whether the Plaintiff is entitled to judgment against the 3^rd Defendant based on Order 14 Rule 1, Order 18 Rule 19 or the inherent jurisdiction of the Court.

16.  For this purpose, I shall assume that all the facts pleaded in the 3^rd Defendant’s Defence and Counterclaim can be established at the trial.

17.  It is not in dispute that, subject to the claim of adverse possession by the 3^rd Defendant, the Plaintiff is the owner of the External Wall.  It is also clear, in my view, that the acts of attaching or affixing the Structures to the External Wall were acts of trespass.  Such trespass is continuing up to the present moment.

18.  From the various floor or site plans and photographs of the External Wall and the Structures which have been produced as exhibits, it would be fair to infer that the External Wall stands upon the boundary of the Land; in other words the Structures in fact situate outside the Land and occupy part of the scavenging lane.  It follows that the Plaintiff’s complaint cannot be that the 3^rd Defendant has wrongfully occupied any part of the Property, but is simply that the 3^rd Defendant has wrongfully attached or affixed the Structures to the External Wall.

19.  I do not know whether the scavenging lane is a public lane and who is the owner of the scavenging lane.  However, it is not suggested that the Plaintiff is the owner of the scavenging lane, and thus the mere fact that the 3^rd Defendant has occupied a part of the scavenging lane is not something that the Plaintiff has locus to complain about.

20.  The question which thus arises is whether, as a matter of law, the concept of “adverse possession” can apply to a vertical plane or surface such as the surface of the External Wall in the present case.

21.  Miss Ho for the Plaintiff submits that, as a matter of law, whatever is acquired by means of exclusive possession must be measurable by precise metes and bounds and in some way cubically.  Miss Ho relies on the following passages in the judgment of Byrne J in Midland Railway Co v Wright [1901] 1 Ch  738 at 744:-

“It is said that the possession to give title and to dispossess must be an exclusive possession, and it was argued that although the possession in the present case of the surface has been exclusive, it has not been an exclusive possession of the land, inasmuch as the possession of it must be looked upon as a partial possession of the whole land including the surface. I cannot accept this. The possession of the surface primâ facie gives title to all above and below subject to rights of owners beneath and above…

I do not think it is necessary for me to attempt to draw a division in the strata between the surface of the land and the top of the tunnel, and to define precisely where the property of the surface owner ends and the property of the railway company begins. A number of illustrations were put, and a number of hypothetical cases were presented, some of them involving points of nicety, and it was argued that although a man may acquire by possession a title to a cellar, though no part of the house above belongs to him, that although he may acquire a title by possession to a single room in the house, that although he may acquire a title to a cave in a bank or in the ground, nevertheless it is necessary that whatever is acquired by means of this exclusive possession should be measurable by precise metes and bounds and in some way cubically. I think I am rightly expressing the argument which was addressed to me on this point. If this be true, then I think it would follow that the ordinary rights of the owner of the soil would apply, and that the possession of the soil above would carry everything beneath except that which was the property of another party.” [underlining added]

22.  It would seem that Byrne J was there merely summarising counsel’s argument without expressing his concurrence with the argument.  Miss Ho also refers to the judgment of Sholl J in Symes v Pitt [1952] VLR 412 at 425, but it does not appear to me to take the matter any further.

23.  Nevertheless, I am inclined to accept Miss Lo’s submission as a matter of principle.  In any event, as is apparent from Mr Liu’s argument at the hearing, his case is not that the 3^rd Defendant has acquired title, by way of adverse possession, to only the surface of the External Wall; his case is that the 3^rd Defendant has acquired title to half of the thickness of the External Wall as well as the surface of External Wall facing the Stall.  However, I am unable to see how, from the mere fact that the 3^rd Defendant has attached or affixed certain structures to the External Wall and used those structures for a long time, it can be inferred that the 3^rd Defendant has taken adverse possession of half of the External Wall to the exclusion of the Plaintiff, or its predecessors in title, or that the 3^rd Defendant intended to exclude the Plaintiff or its predecessors in title from having the use or possession of the External Wall or half of it (as opposed to merely a surface of the External Wall).

24.  As rightly pointed out by Miss Ho, at all material times, the Plaintiff or its predecessors in title have had the use of the External Wall, as a means of enclosure of the backyard of the Property.

25.  In the circumstances, I do not consider that the 3^rd Defendant’s case, taken at its highest, whether on the basis of his pleadings or his evidence, can begin to make out a case of adverse possession of the External Wall or half of it.  I am satisfied that the 3^rd Defendant has not raised any arguable or triable defence to the Plaintiff’s claim against him for trespass of the External Wall.

26.  I would accordingly give judgment to the Plaintiff against the 3^rd Defendant under Order 14 Rule 1 of the Rules of High Court in terms of paragraph 1b (in respect of the External Wall only) and paragraph 3a (the relevant works to be carried out and completed within 28 days of the date of the order herein) of the prayer for relief in the Statement of Claim.  I would also strike out the 3^rd Defendant’s counterclaim against the Plaintiff.  I am not minded, however, to give interlocutory judgment to the Plaintiff against the 3^rd Defendant for damages to be assessed, in the absence of particulars or evidence of loss or damage.

27.  I would also make a costs order nisi that the Plaintiff shall have the costs of the action, including the costs of the present application, against the 3^rd Defendant, to be taxed if not agreed.

28.  At the request of Mr Liu, I give a direction, pursuant to Order 59 Rule 21(3) of the Rules of High Court, that the present judgment is one referred to in Order 59 Rule 21(1) of the Rules of High Court and thus the 3^rd Defendant is entitled to appeal as of right from the present judgment.

29.  Lastly, I wish to thank counsel for their assistance in this matter.