FINE GOLD DEVELOPMENTS LTD v. PERSONS WHOSE PROPERTIES ARE LEFT UNCOLLECTED AT FACTORY C, 1ST FLOOR, KWAI BO INDUSTRIAL BUILDING, NO.40 WONG CHUK HANG ROAD, HONG KONG

DCMP 4996/2024

[2025] HKDC 2213

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 4996 OF 2024

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JUDGMENT

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1.  The Plaintiff is the registered owner of the premises situates at Factory C, 1^st Floor, Kwai Bo Industrial Building, No. 40 Wong Chuk Hang Road, Hong Kong (“Premises”). In 2023, the Plaintiff’s tenant, Manga Storage (HK) Limited (“Manga Storage”), operated a mini-storage business at the Premises which had been sub-divided into approximately 130 cubicles in various sizes with corridors and common areas including reception, lavatories, storeroom and flat roof.

2.  In April 2023, Manga Storage failed to pay rent and eventually closed down its business at the Premises. The Plaintiff took re-possession and found that there were chattels and goods inside the Premises which were left behind by Manga Storage and/or its service subscribers.

3.  By an Originating Summons dated 2 September 2024 (“OS”), the Plaintiff commenced the present proceedings against “Persons whose properties are left uncollected at [the Premises]”, the Defendant, seeking the following reliefs:

(1)  A declaration that the Left Properties (as defined in paragraph 11 of the Affirmation of Chu Hoi Wan) have been abandoned by the Defendant;

(2)  A declaration that the Plaintiff is entitled to dispose of the Left Properties at will;

(3)  Costs incurred by the Plaintiff for disposing of the Left Properties be paid by the Defendant; and

(4)  Costs of this action be paid by the Defendant.

4.  Pursuant to the order of Master Charmaine Lo dated 25 April 2025 granting leave for substituted service, the Plaintiff:

(1)  posted up a sealed copy of the OS and a copy of the Master’s order at the entrance of the Premises on 13 May 2025; and

(2)  caused the publications of an English and a Chinese advertisement on “Standard” and “Sing Tao Daily” respectively on 15 May 2025.

5.  No one has filed an acknowledgement of service in these proceedings to date.

6.  A Notice of Appointment to Hear the OS was taken out on 22 May 2025 with the hearing fixed on 11 July 2025. At the hearing, the Defendant did not appear. The Plaintiff asked for summary disposal of the OS.

No Acknowledgement of Service

7.  A defendant must acknowledge service within 14 days of being served with an originating summons: see O 12 r 5 and r 9, Rules of the District Court (Cap 336H) (“RDC”). Pursuant to O 28 r 3 (5)(a) of the RDC, a plaintiff is not required to serve the notice of hearing on a defendant who has not filed an acknowledgement of service.

8.  I am satisfied that the Defendant has failed to acknowledge service of the OS and therefore proceed to dispose of these proceedings summarily: see O 28 r 4 and 6, RDC. I bear in mind that the burden remains on the Plaintiff to justify that it is entitled to the reliefs sought: Choy Pui Lam v Estate of Chan Yim Mei[1]

Judgment against Magna Storage

9.  On 16 August 2023, the Plaintiff commenced proceedings HCA No. 1294 of 2023 against Manga Storage for inter alia arrears of rent and forfeiture of the tenancy. A sealed copy of the Writ of Summons was posted up at the entrance of the Premises on the same day. Subsequently and in October 2023, having obtained default judgment against Manga Storage, the Plaintiff posted bilingual Notice to Quit at the entrance of the Premises, notifying all persons in actual possession of the Premises to vacate the Premises by 8 November 2023 (“Notice to Quit”).

10.  Some subscribers who visited the Premises around that time were brought to notice by the Notice to Quit. According to an article published on 10 November 2023 by an online newspaper HK01, one subscriber learnt that the Premises would be re-possessed upon reading the Notice to Quit posted at the entrance. He then tried to contact Manga Store but in vain. He immediately arranged to vacate his belongings from the Premises on the next day.

11.  In a television program best known for reporting on audiences’ complaints[2], another subscriber of Magna Storage said that she saw legal document posted at the entrance of the Premises demanding occupants to vacate by 8 November 2023. She then took steps to contact Manga Storage only to find that it had moved out from its office premises and could not be reached. On 28 November 2023, she together with the host of the television program visited the Premises and found, inter alia, that many subscribers have already vacated their belongings from the Premises.

12.  At that time, Magna Storage has clearly ceased business but subscribers still had access to the Premises as well as their own cubicle. Due to the media coverage and the Notice to Quit posted at the entrance of the Premises, some subscribers did vacate the Premises.

Re-Possession

13.  Subsequently, a Writ of Possession and Fieri Facias Combined was issued. Notice to Occupier to Quit was posted up at the entrance of the Premises by the bailiff on 6 March 2024, with the Final Notice posted on 21 March 2024. On 28 March 2024, the Plaintiff recovered possession of the Premises with the assistance of the bailiff who took inventory of the goods and chattels found both inside the individual cubicle and the common areas. They included personal effects such as clothing, electrical appliances, kitchen utensils, computer gadgets, furniture, wine, toys, books, miscellaneous sundry items etc. The goods and chattels were all delivered to the bailiff for his custody and the appraised total value was HK$71,811.60.

14.  After the repossession by the bailiff, a “Notice re Disposal of Abandoned Property” dated 2 May 2024 both in English and Chinese were advertised in The Standard and Sing Tao Daily respectively on 9 May 2024 providing contact details of the Plaintiff with a view to notify Magna Storage’s subscribers to collect their belongings stored at the Premises. The said Notice reads as follows:

“.. Any person who has left any property at the captioned premises shall contact the representative of the Owner immediately [by email or telephone] to collect the property. Otherwise, such property will be deemed as abandoned and the Owner shall apply for relevant directions from the Court. In such case, the said property may be discarded, sold or otherwise disposed without further notice, and the Owner will not be liable for any compensation thereof.”

15.  Further, by various letters sent to its registered office and the addresses of its directors, shareholders and company secretary, the Plaintiff’s solicitors wrote to notify Magna Storage that the Plaintiff would soon dispose of the goods and chattels left the Premises and to seek its assistance in notifying its subscribers of the same. Notwithstanding, the Plaintiff received no response.

16.  By reason of the steps taken by the Plaintiff and as can be seen from the above, some of the subscribers were made aware of the situation and had come forward to collect their properties. As at the commencement of the present proceedings, there were still properties left at various locations and inside 36 cubicles (“Left Properties”). According to the assessment of the bailiff, the total value of the Left Properties is HK$33,755.50.

17.  It is the Plaintiff’s case that following the forfeiture of the tenancy, Magna Storage had no right to remain and/or leave its properties at the Premises and its subscribers had no better right to do so. Thus, the leaving of the Left Properties amounted to trespass.  Since the Plaintiff had made reasonable attempts to return them to the owners but to no avail, it is entitled to remove the same.

Applicable Principles

18.  In Jones v Gospel & White[3], the English Court of Appeal held that to place or leave a chattel on the land of another, without consent, is a trespass and that the owner of the land is entitled, taking reasonable care, to remove the offending chattel.

19.  The above principle was applied in Chan Cho Fai v Lam Kit Heung[4]. In Chan Cho Fai, the plaintiff, in the course of recovering possession of his premises against an occupier through bailiff’s execution, found the defendant was unlawfully occupying the premises as trespasser. The defendant was evicted and an inventory of goods and chattels left inside the premises drawn up. Various attempts were made to request the defendant to remove/retrieve the properties but to no avail. The court found that the plaintiff was an involuntary bailee of the left properties who had made reasonable attempts to return them to the defendant and granted the declaration that the plaintiff was entitled to dispose of them at will.

20.  At §§13-14[5], the learned Judge said:

“13. The difficulties encountered by an involuntary bailee in such situation are succinctly pointed out by the learned authors of Palmer on Bailment at §13-050 as follows:-

There is at common law no general right to dispose of goods which a bailor has refused, or is unable to collect. In Sachs v Miklos, Lord Goddard C J suggested that the bailee might place the bailor in a position of having impliedly consented to a sale, by writing to him and warning him that this will take place unless the goods are collected within a specified time. But this raises difficulties, not least in that silence in response to an offer cannot generally be taken to connote consent. Nor will the principle of agency of necessity relieve the bailee, except in very limited circumstances, from the consequences of an unauthorized disposal. It should be borne in mind that, according to Lord Diplock in The Winson, the strict concept of agency of necessity is now to be limited to situations where the notional agent seeks to create contractual relations between his notional principal and a third party. As the decision of McCardie J in Pager v Blatspiel, Stamp and Heacock shows, there must be an actual commercial necessity dictating the disposal before the bailee can evade liability for conversion; in addition, the bailee must have acted prudently and bona fide in the interests of the owner and must have been, for practical purposes, unable to communicate with his bailor prior to the disposal. Although this doctrine may apply where goods are deteriorating or otherwise falling in value (provided the depreciation is sufficiently serious to constitute an emergency) there is little prospect of its acceptance in situations where the disposal or other treatment is for the benefit of the bailee alone.

… Clearly, this is one situation in which the common law is incapable of supplying a satisfactory solution.” (Palmer on Bailment 3rd edition, para 13-050 at pages 742-743.)

14. The draconian liability seems to be have been modified by the court in the local case of Desir Anthony C v Knight Frank (Services) Ltd, (unrep, HCSA 36/2013, [2015] HKEC 44, 9 January 2015), (DHCJ Marlene Ng), which held that ‘… if an involuntary bailee performs in good faith an act which, taken in the abstract, would amount to a conversion, he is liable only if the performance of that act was accompanied by a lack of reasonable care. If an involuntary bailee conscientiously performs acts with the object of returning the goods to their owner, such acts would be regarded as reasonable acts.” However, the court went on to state that “what is reasonable will depend on all the circumstances, including the nature of the goods. The burden falls on the involuntary bailee to prove that he has exercised the required standard of care’: (per DHCJ Marlene Ng at §82).”

Analysis & Disposition

21.  In the present case, it is beyond dispute that upon the forfeiture of the lease, neither Magna Storage nor its subscribers were allowed to leave their properties at the Premises without the Plaintiff’s consent. It is a clear case of trespass to land. Applying the above principles, it is for the Plaintiff to demonstrate that it has acted in good faith and exercised reasonable care (meaning having taken reasonable steps) in dealing with the Left Properties.

22.  On the evidence filed by the Plaintiff, I am satisfied that since October 2023, the Plaintiff has made repeated attempts to invite the Defendant to retrieve or remove all properties left at the Premises. I am also satisfied that the Plaintiff has acted in good faith and exercised reasonable care in dealing with the Left Properties in the circumstances of the case. Notwithstanding, no one has come forward to claim ownership of the Left Properties or responded to the OS.   

23.  Given that the Left Properties have remained uncollected since October 2023, I am satisfied that it is only appropriate for the Court to grant the declaration that the Plaintiff is entitled to dispose of the Left Properties at will.

24.  As to the declaratory relief that the Left Properties have been abandoned by the Defendant sought in the OS, Mr Chan, solicitor appearing for the Plaintiff, initially invited the Court to infer the Defendant’s intention to abandon the Left Properties from its failure to collect the same to date. On the other hand, Mr Chan accepted that such a declaration would not be necessary if a declaration that the Plaintiff is entitled to dispose of the Left Properties at will is granted. I agree. In the circumstances, I would not grant such declaration.

25.  As for the costs of disposal of the Left Properties, I see no reason why the same should not be borne by the Defendant as damages recoverable from the trespasser. I therefore make an order that the same be paid by the Defendant.

26.  Costs should follow the event. I therefore also order that the Defendant do pay the costs of this action.