TSANG WING LAM v. THE HONG KONG HOUSING AUTHORITY

DCCJ 9895/2000

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 9895 OF 2000

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JUDGMENT

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1. In this action the plaintiff claims against the defendant for $785,000 said to be damages suffered by him as a result of the defendant's negligence arising from the impoundment of his car.

2. The claim for $785,000 is calculated as follows :-

a. Special damages

i. Replacement value of his car in the sum of $85,000

ii. Loss of benefits as a first-hand car owner in the sum of $50,000; and

iii. Value of emotional and habitual loss in relation to his car in the sum of $50,000.

b. General damages for mental anguish suffered by the plaintiff and his family in the sum of $600,000.

3. The Plaintiff is content to forgo that part of his claim which is over and above $600,000 so as to come within the jurisdictional limit of this court.

4. The defendant denies the plaintiff's claim and in turn counterclaims for charges arising from the impoundment, removal and storage of his car.

5. Though the trial was conducted in Chinese the parties agreed that judgment would be delivered in English.

Background

6. The plaintiff lives at King Tin Court, Tai Wai, Shatin, New Territories. He has a car, a Toyota Cressida, which was purchased in 1986 for $130,962. The plaintiff used to park his car at the car park of King Tin Court ("the car park"). The car park was owned by the Housing Authority and managed by the Urban Property Management Limited ("the management company") under a contract for management dated 5th August 1998.

7. The plaintiff's car was parked at the car park pursuant to written agreement between himself and the defendant. Under such an agreement a car park space was designated to the plaintiff in consideration of a monthly parking fees. Whilst there was a new agreement for each calendar year the terms and conditions of these agreements were identical. Clause 1 of the agreement required the plaintiff to pay in advance, prior to the 1st of each calendar month, the parking fees for that month. Clause 10 of the agreement expressly reserved the rights of the defendant to impound or remove from the car park those cars which contravened the terms and conditions of the agreement.

8. From November 1998 the plaintiff began to default in the parking fees. Cheques issued by him for the monthly fees for November and December 1998 was dishonoured. The plaintiff was informed of this in a letter from the management company dated 11th December 1998 and was asked to settle the outstanding sums by 19th December 1998. There being no response from the plaintiff, the management company wrote to the plaintiff again on 12th January 1999 warning him that his car would be impounded unless the outstanding fees were settled on or before 15th January 1999.

9. In the meantime, and notwithstanding the outstanding parking fees for November and December 1998, the plaintiff applied for a car park permit to park his car in the car park for 1999. His application was successful as evidenced by the agreement dated 22nd December 1998 between him and the defendant. Under this agreement the plaintiff was assigned the car park space number 202 for a monthly fees of $1,480.

10. The plaintiff paid the monthly fees for January 1999 but defaulted in the fees for subsequent months. On 12th March 1999 the management company wrote to the plaintiff repeating its demands for the settlement of the outstanding fees for November and December 1998 and for February and March 1999. The plaintiff was given until 18th March 1999 to settle the outstanding sums. In addition to the letters Mr. Chan Hing Li, employee of the management company who gave evidence for the defendant, said he also telephoned the plaintiff on numerous occasions regarding the outstanding monthly fees.

11. Apparently the plaintiff did not respond to the letters or the verbal requests and the outstanding fees remained unsettled. On 13th April 1999 the management company impounded the plaintiff's car and notified him of the same by a letter dated the same day. The plaintiff was warned that the car park permit for 1999 under the agreement would be revoked if the outstanding payments were not settled by 20th April 1999. Despite the threat the plaintiff took no remedial steps and continued to default in the parking fees for May 1999. By a letter dated 25th May 1999 from the management company the plaintiff was warned that his car would be scrapped if the outstanding payments were not made.

12. Eventually in June 1999 and after repeated phone calls from the management company, the plaintiff settled the monthly fee for February 1999 but not that for November and December 1998 and for March, April and May 1999.

13. On 15th July 1999 the management company telephoned the plaintiff again urging payments but to no avail. This was the last contact between the plaintiff and the management company before the plaintiff's car was damaged on 23rd August 1999 when a typhoon signal 8, and subsequently, signal 10, was hoisted. The windscreen of the plaintiff's car was broken when a tree collapsed onto it. Despite knowledge of the damage the plaintiff made no attempt to settle the necessary fees in order to have the car released for repair.

14. In the meantime the management company continued to issue letters to the plaintiff demanding payments but to no avail. Eventually on the 3rd November 1999, the defendant issue proceedings in the Small Claims Tribunal to recover the outstanding fees. In response the plaintiff counterclaimed against the defendant for damages arising from the impoundment and the incident on 23rd August 1999. By an order made on 28th April 2000 the plaintiff's counterclaim in the Small Claim Tribunal was transferred to this court becoming the present claim. The plaintiff's counterclaim in the Small Claims Tribunal was for special damages in the sum of $111,693. After his counterclaim was transferred to this court, the plaintiff's amended his claim by increasing the amount of special damages to $185,000 and by making an additional claim for $600,000 as general damages for mental anguish.

15. Despite the outstanding fees and the incident on 23rd August 1999, in November 1999 the plaintiff applied for a car park permit for 2000. Not surprisingly his application was rejected and he was so informed by a letter from the management company dated 22nd November 1999. The letter also warned the plaintiff that his car would be towed if the outstanding sums were not settled by 24th November 1999.

16. On 28th April 2000, upon the plaintiff's admission, the Small Claim Tribunal ordered him to pay the defendant the sum of $5,320 together with interests.

Right to Impound

17. The plaintiff argued that the defendant and the management company had no right to impound his car since he did not owe the defendant any money. The basis of the plaintiff's contention, in short, was that the car park belonged jointly to the respective owners of King Tin Court (of which he was one) and not the Housing Authority. Further the plaintiff said the impoundment was unlawful as it was nothing more than coercion by the defendant for him to pay.

18. In light of the plaintiff's admission at the Small Claims Tribunal and the adjudication of the Tribunal, the plaintiff's argument that he did not owe the defendant any money must fail.

19. Section 25B of the Housing Ordinance provides that :-

"(2) The Authority or an authorized officer may impound or remove any vehicle which is -

{(a) to (d) are not relevant and not applicable.}

(e) parked in a car park unless such parking is authorized by the Authority or an authorized officer."

20. Counsel for the defendant Mr. Lee acknowledged the impoundment on 13th April 1999 was outside the ambit of section 25B(2)(e) of the Housing Ordinance because the agreement under which the plaintiff was assigned car park space number 202 was in existence that day, such agreement was only revoked on 20th April 1999 when the plaintiff failed to meet the deadline for payment. Therefore it cannot be said that the parking of the plaintiff's car at the car park prior to 20th April 1999 was unauthorized. However, Mr. Lee argued, even if the impoundment on 13th April 1999 was not sanctioned by section 25B of the Housing Ordinance, it became so sanctioned on 20th April 1999 when the plaintiff's parking permit was revoked pursuant to the management company's letter of 13th April 1999.

21. When the car was impounded on 13th April 1999 the plaintiff owed the defendant the monthly parking fees for November and December 1998 and for February, March and April 1999. Therefore it matters not whether the impoundment on the 13th April 1999 was within section 25B of the Housing Ordinance or not because the management company was entitled to exercise a common law lien over the car by impounding it until the outstanding fees have been settled: Snell's Equity, 13th edition paragraph 21-06. The plaintiff's argument that the impoundment was unlawful as it was a means of coercion for payment must therefore fail.

22. The plaintiff also argued that it was unnecessary for the management company to impound his car to secure payment since the company already had a security for the outstanding fees. When asked what form of security the management company had, the plaintiff claims the dishonoured cheques were sufficient and good security. It is inconceivable that the plaintiff, a businessman, should regard a dishonoured cheque as good security. I doubt very much whether the plaintiff would think the same if cheques issued by his customers were dishonoured.

23. In addition to a right of lien and the right to impound conferred by section 25B of the Housing Ordinance, clause 10 of the car park agreement also expressly empowered the management company to impound vehicles parked at the car park in contravention of the car park agreement. Having defaulted in the monthly parking fees the plaintiff had contravened the condition under the agreement with regard to payment. Under the circumstances the management company had every right to impound the plaintiff's car on 13th April 1999.

Consequence of impoundment

24. Having impounded the car on 13th April 1999, the plaintiff said the management company had acted negligently by leaving the impounded car in the car park and that such negligence resulted in the car being damaged by the falling tree on 23rd August 1999. The plaintiff also sought to hold the defendant liable for the management company's refusal to release his car. According to the plaintiff such refusal prevented him from moving his car to a safe place on 23rd August 1999 thus avoiding the collapsed tree. The defendant is said to be vicariously liable for the negligent act of the management company.

25. There is no question that the management company owed to the plaintiff a duty to take such care as was reasonable in all the circumstances of the case. Whether the management company was in breach of such duty of care depends on whether the damage that occurred in this case was reasonably foreseeable.

26. It is to be noted that the tree that fell onto the plaintiff's car was outside the compound of King Tin Court in that it was on a slope adjacent to the car park. Mr. Chan said no similar incident had ever happened at the car park and it had never been necessary to take any precaution to protect the cars in the car park whenever there was a typhoon or rainstorm. Mr. Chan has never witnessed any car owners covering or protecting their cars during adverse weather condition.

27. I accept Mr. Chan's evidence that during the hoisting of signal 8 and 10 on 23rd August 1999, there were cars at the car park and no safety or precautionary measures were taken by the respective owners to protect their cars. Clearly the tree collapsing onto the plaintiff's car on 23rd August 1999 was an accident that was not reasonably foreseeable by anyone. Therefore I find that the management company was not negligent when it left the impounded car at the car park on 23rd August 1999.

28. I now turn to the plaintiff's argument that the damage to his car was a result of the refusal of the management company, despite requests from him, to release his car prior to the hoisting of the typhoon signal. Mr. Chan denies the plaintiff had made such a request whether prior to or on 23rd August 1999. I accept the evidence of Mr. Chan whom I find to be a credible and impartial witness. By contrast I am not impressed with the plaintiff whom I find is far from truthful and is prone to gross exaggeration. The vehicle registration of the plaintiff's car had expired on 26th July 1998. There is evidence that the car had not been driven since. On 1st January 1999 the defendant and his family members had to physically pushed the car from its old car park space to the newly assigned car park space number 202. I find the plaintiff had no intention to use the car and was thus prepared to let it remained clamped at the car park as long as he did not have to pay the monthly fees. The plaintiff repeatedly chose to ignore the demands for payment despite warnings of impoundment of his car. Even after his car was impounded the plaintiff still did not settle the outstanding fees despite knowing his car might be towed away and scrapped unless payments were made. Had there been any genuine intention to get his car back, the plaintiff would have settled the outstanding fees or at least negotiate with the management company with regard to the possibility of installment payments. The plaintiff did none of this.

29. For reasons above and given my findings that the management company had a right of lien over the car there is no merits in the plaintiff's argument that the incident on 23rd August 1999 was caused by the management company's refusal to release his car.

Removal of the car

30. In view of the plaintiff's persistent non-payment the car was removed from the car park on 6th July 1999 and towed to the defendant's pound at Shui Pin Wai Estate in Yuen Long.

31. Section 25B(3) of the Housing Ordinance set out the criteria under which the power to remove a car under section 25B(2)(e) could be exercised. Section 25B(3) provides :-

"(3) The power of impounding or removing a vehicle under subsection (2) shall be exercised only when -

{(a) is not relevant}

(b) the driver is unable to remove the vehicle, or refuses or fails to remove the vehicle, on being requested to do so by the Authority or an authorized officer."

32. Since 4th May 2000 the management company had requested the plaintiff to remove his car from the car park. Such a request was instead met with the plaintiff's arrogant and unreasonable demand that the management company should first repair his car and return the repaired car before any payment would be made.

33. The plaintiff was well aware of his obligations to pay monthly parking fees under the car park agreement. As a party to the agreement he must also be aware of the consequence of persistent non-payment of such fees. Therefore the plaintiff cannot be heard to complain about the impoundment of his car. Having received warnings that his car would be towed and scrapped the plaintiff elected to do nothing. In the circumstances I find that the management company was entitled to remove the plaintiff's car from the car park, not only pursuant to the Housing Ordinance but also under clause 10 of the car park agreement.

34. The plaintiff is liable for the charges for impounding, removing and storing his car under section 30 of the Housing (Traffic) By Laws,

Damages claimed by plaintiff

35. At the end of the Mr. Lee's submissions the plaintiff sought to file a notice withdrawing his claim for $600,000 as general damages for mental anguish. Having been advised that leave to withdraw is required the plaintiff refused to seek leave insisting that he was entitled to withdraw his claim by virtue of Order 21 rule 2 of the Rules of the District Court since he only received the translated Amended Defence and Counterclaim at the beginning of the trial and his notice of withdrawal therefore is within 14 days of the service of Amended Defence and Counterclaim.

36. The Amended Defence and Counterclaim in English was served on the plaintiff on 19th September 2002. It was subsequently translated into Chinese and the translated version was included in the trial bundle received by the plaintiff at the commencement of the trial. Since September 2002 the plaintiff has never raised any issue concerning his ability to understand the English Amended Defence and Counterclaim. Indeed he was able to respond to the English Amended Defence and Counterclaim by settling and filing a Re-Re-Amended Reply and Defence to Counterclaim. Though the trial was conducted in Chinese, the plaintiff was obviously able to read and understand English judging from the passages he cited from legal text books such as Odgers on Civil Court Actions and the Ordinances. The plaintiff's attempt to argue that Order 21 rule 2 applies because he only received the translated Amended Defence at the beginning of the trial was spurious and was rejected by me.

37. In view of my findings the plaintiff's claim for damages must fail. It is not necessary for me to go into the plaintiff's evidence with regard to the valuation of a replacement car. However I cannot refrain from commenting that the plaintiff's claim for loss of benefits as a first time car owner, the value of emotional and habitual loss and general damages for mental anguish are not recognized heads of damages and were doomed to inevitable failure regardless of the issue of liability.

Conclusion

38. The plaintiff's claim is dismissed.

39. There is judgment for the defendant in the counterclaim for the charges for releasing the impounded car in the sum of $320, for removal of the car in the sum of $420 and for storage of the car from 6th July 2000 until removal of the car from the pound at Shui Pin Wai Estate, Yuen Long at the rate of $110 per day.

40. There being no evidence or application as to any other costs which the defendant might incur in relation to the car, I make no order in relation to paragraph 27(v) of the defendant's Amended Counterclaim.

41. There is an order for costs nisi of the claim and the counterclaim to be paid by the plaintiff to the defendant with certificate for counsel. The costs nisi shall be made absolute within 14 days of his judgment.