DCMP 2221/2015
IN THE DISTRICT COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
MISCELLANEOUS PROCEEDINGS NO 2221 OF 2015
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IN THE MATTER of ALL THAT one equal undivided 90th part or share of and in ALL THAT piece or parcel of ground registered in the Land Registry as KOWLOON INLAND LOT NO 6704 And of and in the messuages erections and buildings thereon known at the date hereof as FU ON MANSION TOGETHER with the sole and exclusive right and privilege to hold use occupy and enjoy ALL THOSE PORTION OF SHOP E1 of the GROUND FLOOR of the said FU ON MANSION (“the Property”)
and
IN THE MATTER of an Agreement for Sale and Purchase dated 18 March 2015 made between the plaintiff purchaser of the one part and the defendant as vendor of the other part (“Agreement”)
and
IN THE MATTER of Section 12 of the Conveyancing and Property Ordinance (Cap 219)
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BETWEEN
WONG WAI YIP
Plaintiff
and
HO WAI FUNG
Defendant
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Before : Deputy District Judge Sanjay A Sakhrani in Chambers (Open to Public)
Date of Hearing : 12 January 2016
Date of Decision: 21 January 2016
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DECISION
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1. This is the hearing of the defendant’s summons dated 14 December 2015 (the “Summons”) by which it seeks leave by this court to adduce expert evidence in relation to a number of issues.
2. At the outset of the hearing, a document entitled “Agreed Directions” (in respect of the Summons) was handed up to me by counsel purporting to, inter alia, narrow the issues in dispute between the parties. I set out the relevant parts:-
“(1) (a) Leave for the parties to adduce expert evidence in respect of those issues as described under Clause 2 below. The expert report of the Plaintiff dated 16 July 2015 as per Exhibit No. WWY-14 of the Affirmation of Wong Wai Yip dated 13 August 2015 be treated as his own expert evidence and the defendant do file and serve its own expert evidence within the next 56 days from the date of an Order to be made;
……
(2) The issues to which the expert evidence shall relate to are:-
(a) whether the current use of the Property (i.e. non-domestic use) is contravening the existing legislation and/or statutory regulations;
(b) Alternatively, whether the deployment of the Gross Floor Area of the Property falls foul of the existing legislation/statutory regulation(s); and
(c) Whether the Property or any part thereof amount to unauthorized building works under the Building Ordinance (Cap. 123).
3. In addition to those agreed issues under paragraph 2 of the Agreed Directions (the “agreed issues”), Mr Cheung, counsel for the defendant, seeks leave to adduce expert evidence on some additional issues which the parties could not agree. These are set out in the document entitled “Other Directions Proposed by the Defendant” which mirror those issues set out at paragraphs 2 (i), (ii) and (iv) of the Summons (the “outstanding issues”), namely:-
“(2) The issues(s) to which expert evidence will be engaged to express an opinion are:-
(i) Whether the Property was constructed in contravention of the then prevailing legislation(s) and/or statutory regulation(s);
(ii) Whether the Assignment Plan of 10 December 1959 registered in the Land Registry by Memorial No. UB307975 was in compliance with the then prevailing legislation(s) and/or statutory regulations;
……
(iv) Whether the existing legislation(s) and/or statutory regulation(s) govern the state and/or condition of the Property, given the Property was constructed in the 1950s.”
4. Paragraph 2 (v) of the Summons was withdrawn by Mr Cheung at the hearing.
Background
5. Without going into great detail, the background of the dispute is that the plaintiff purchaser purported to purchase a ground floor shop (the “Property”) from the defendant seller. At around the time of the formal sale of the Property, requisitions were raised by the plaintiff’s solicitors which the plaintiff says have not been sufficiently answered.
6. The main argument raised by the plaintiff in support of its Originating Summons is that the Occupation Permit No. K326/5 purports to identify five ground floor shops for non-domestic use, but that there are a total of six shops appearing on the Assignment Plan annexed to the Assignment Memorial No. UB307975 in 1959. The plaintiff sought clarification from the defendant on this.
7. The defendant replied that the Assignment Plan was certified by architects at the time and show that six ground floor shops (of which the Property was one of them) were properly subdivided and not in contravention of the legislation. The defendant additionally argues that in the ensuing years, there has been no enforcement action from the government such that it is most likely that the Building Authority had acknowledged the Property and ultimately the defendant asserts that its title has been proved[1] .
8. The plaintiff takes issue that the requisition was sufficiently answered and alleges that the defendant has not shown good title and/or the title of the Property is defective such that it wishes the return of its deposit together with other relief.
Expert evidence sought by the defendant
9. The defendant’s case is that it has done enough to prove good title and disagrees with the plaintiff’s allegation that it has not. In seeking leave to adduce expert evidence on the outstanding issues, Mr Cheung argues that the agreed issues are too narrow in that they simply focus on the law as it stands now. Whilst this may be what the plaintiff seeks to rely on for its application it does not paint the full picture in relation to the Property.
10. He says that the defendant has all along believed that it has good title and it would be necessary for the expert to investigate the history of the prevailing legislation in the 1950s at the time of the construction of the building (and Property). He said that it if the expert could offer assistance as to the laws then prevailing it would be of help to the defendant (and to the court) in determining the Originating Summons. In this respect, he suggested that the expert would consider whether the Property when constructed was in contravention of any legislation then prevailing. And to confirm whether “everything was in order” and in full compliance as a matter of fact.
11. However, in the same vein, Mr Cheung was not sure whether the expert couldassist, which he said was a “big if” and which might be a time consuming exercise that might ultimately prove fruitless.
The plaintiff’s argument
12. Ms Gwilt, counsel for the plaintiff, argues that the plaintiff’s case is straightforward and is simply that the defendant has failed to prove good title. She argues that the agreed issues address this and the other points in dispute and that the outstanding issues are irrelevant to the plaintiff’s application.
13. On the question of the defendant’s request she argues that there is no issue in relation to the building regulations or legislation in force in the 1950s. Whilst expert evidence is necessary, as set out by the agreed issues, the plaintiff’s case is that the Property as offered to the purchaser is not in accordance with the original plans and in contravention of those plans/drawings. Also in arguing that there has been a “change of use,” in comparison to the “use” stated in the drawings, there was no need, she says, to go back and look at how the Property may or may not have been used in the 1950s and since. Such may be of historical interest to the defendant but the plaintiff’s application is a narrow one and these points are irrelevant.
14. She adds that if the plaintiff succeeds on any of the three agreed issues then it will be successful. If not, then it will be unsuccessful. Whether the Property was constructed contrary to the then prevailing legislation in the 1950s, as proposed in the outstanding issues, is neither here nor there.
Analysis
15. Although the historical documents have all been exhibited to the evidence so far filed for the upcoming hearing, the question is whether expert opinion in respect of the outstanding issues is necessary, indeed relevant, for the determination of the plaintiff’s application. This assuming that the expert will be able to even carry out the exercise proposed by the defendant.
16. I agree with Ms Gwilt that the dispute is a straightforward one and that the 1950s legislation and history of the Property are not relevant to the dispute at hand even though the defendant may contend otherwise. I would have thought that whether the defendant can prove good title or not is necessarily whether it can prove good title in light of the legal position at the time of the proposed sale. What may or may not have happened in the 1950s (as proposed by the outstanding issues) is a matter for the defendant itself to resolve – this should not, in my view, concern the plaintiff’s application.
17. I accept that the agreed issues, in respect of which the defendant will no doubt be adducing its own expert evidence, adequately cover the points relevant to the plaintiff’s application.
18. Accordingly, I simply make an order in terms of the Agreed Directions (as amended during the hearing) and decline to grant the Other Directions Proposed by the defendant. This means that I do not grant leave to the defendant to adduce expert evidence in respect of the outstanding issues.
Costs
19. Since the defendant’s Summons needed to be argued (albeit in respect of a fewer number of issues), costs should follow the event. I make an order nisi that the defendant shall pay the costs of the plaintiff in any event, such costs to be taxed if not agreed, with certificate for counsel. The order will become absolute in the absence of any application by the parties to vary the same within 14 days.
20. I thank both counsel for their assistance to the court.
( Sanjay A Sakhrani )
Deputy District Judge
Miss Angela Gwilt, instructed by Humphrey & Associates, for the plaintiff
Mr Jeremy Cheung, instructed by Littlewoods, for the defendant
[1] Mr Cheung loosely referred to the case of Jumbo Gold Investment Ltd v Yuen Cheong Leung [1999] 3 HKLRD 825 in support.