MAN KAI TAK v. 梁妹 AND OTHERS

DCCJ 1806/2010

[2018] HKDC 493

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 1806 OF 2010

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DECISION

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INTRODUCTION

1.  This is the 2^nd and 3^rd defendants’ application by summons filed on 21 March 2017 for leave to appeal against my judgment dated 23 February 2017 (“the Judgment”) and for stay of execution pending appeal.  Unless otherwise stated, I will adopt the same abbreviations and nomenclatures as used in the Judgment.

2.  The concluding order from the Judgment was as follows:-

(a)  The 2^nd and 3^rd defendants do give the plaintiff vacant possession of the premises described in the Re-amended Statement of Claim endorsed on the Writ of Summons as Lot No 995 in Demarcation District No 102, Yuen Long, New Territories, Hong Kong.

(b)  The 2^nd and 3^rd defendants do jointly and severally pay the plaintiff:-

(i)  damages at the annual rate of HK$600 from 19 July 2010 to the date of delivery of vacant possession; and

(ii)  interest on the said damages at judgment rate from the date of judgment until payment.

(c)  The counterclaim of the 2^nd and 3^rd defendants be dismissed.

(d)  Save and except for previous costs orders made by the court, there be a costs order nisi that the 2^nd and 3^rd defendants do jointly and severally pay the costs of this action including the costs of the plaintiff’s claim and the costs of defending the counterclaim, to be taxed if not agreed, with certificate for counsel.  The costs order nisi shall become absolute in the absence of application to vary within 14 days.

PRINCIPLES FOR GRANTING LEAVE TO APPEAL

3.  Under section 63A(2) of the District Court Ordinance, leave to appeal shall not be granted unless:-

(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.

4.  In the case of SMSE v KL [2009] 4 HKLRD 125, Le Pichon JA said this in paragraph 17 of the judgment:-

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

5.  Paragraph 59/2A/4 of Hong Kong Civil Procedure 2018 also refers to the threshold for granting leave to appeal:-

“… In KNM v HTF (unrep., HCMP 288/2011, [2011] H.K.E.C. 1210, the Court of Appeal (at §9) confirmed that “The relevant test of whether an appeal has a reasonable prospect of success under section 63A [District Court Ordinance], is whether the applicant for leave can show that he has an arguable case with reasonable chances of success on appeal.  A reasonable prospect of success therefore means an appeal with prospects that are more than ‘fanciful’ but which do not need to be shown to be ‘probable’.  It was insufficient to show that the appeal was “merely arguable” and “not fanciful” for the court to be satisfied that it had a reasonable prospect of success …”

6.  With such principles in mind, I proceed to consider the grounds raised by D2 and D3.

GROUND 1 - PAYMENT OF RENT BY D2 & D3’S MOTHER

7.  Mr Lam, counsel for D2 and D3, argues that I erred in law by finding that D2 and D3’s mother Kwok continued to pay rent after the expiration of the 1979 TA on 28 February 1984 and that there was a yearly tenancy afterwards.  He says that I based my finding on hearsay evidence.

8.  Mr Lam was not the counsel conducting the trial for D2 and D3.  As a result, I am afraid he is not familiar with the evidence that the court heard at trial.

9.  The payment of rent by Kwok was evidence coming from the plaintiff’s sister-in-law Hau.  This was not hearsay evidence but direct evidence.  This part can be found in paragraph 4 of her witness statement and her testimony at trial.  Hau said she witnessed the payment of rental by Kwok to Hau’s mother-in-law Pang from 1980 to 1984.  Hau was in Germany from 1985 to 1999.  When she returned to Hong Kong in 1999, she also witnessed the payment of rent by Kwok to Pang until Pang was admitted to elderly home.  She testified that she witnessed Pang collecting rent from Kwok when Kwok visited.  But if Pang went to the Premises to find Kwok for rental collection, Hau would not follow.  On most occasions, it was Kwok visiting Pang and paying rent to her. 

10.  In 2003 when Pang was staying at elderly home, Kwok paid rent to a neighbour and asked the neighbour to pass the same to Hau’s family.  Mr Lam makes the criticism that Hau could not even say the neighbour was a male or a female.  Such criticism once again shows that Mr Lam is not familiar with the evidence heard at trial.  While it is true that Hau did not state clearly that the neighbour was a male or a female in her witness statement.  She clarified in her testimony at trial that the neighbour was 文貴源’s wife and she called her grand auntie (叔婆).  According to Hau, 文貴源 also rented out his land to Leung Senior.

11.  The evidence of Hau showed that she had personal knowledge of the payment of rent by Kwok to Pang from 1980 to 1984 and from 1999 to 2003.  Even though Hau’s personal knowledge could not cover the whole limitation period from 1 March 1984 to 28 February 2004 alleged by D2 and D3 because she was in Germany from 1985 to 1999, there is nothing to show the arrangement during the uncovered period was different from that for those periods witnessed by Hau.  On the contrary, I would say that it was more likely than not that the arrangement was the same throughout the period from 1980 to 2003.

12.  With respect to Mr Lam, I do not see any problem in my acceptance of Hau’s direct evidence and finding that Kwok paid rent to Pang from 1980 to 2003.  Mr Lam’s argument is misconceived.

13.  The plaintiff Man’s evidence also touched on the collection of rent by Pang.  According to Man, matters relating to the 1979 TA were dealt with by his mother Pang until she was admitted to elderly home.  Man emigrated to Singapore in 1995 but he would return to Hong Kong for visits once every 2 years. He would stay around 4 days each time.  Man admitted that from 1970s up to the time before the 2005 TA was entered into, he did not handle matters relating to the 1979 TA personally.  But he said he was sure rent was collected by Pang.  On different occasions, he asked his mother Pang if there was any problem about the tenancy matter.  Pang said no.  The rent collected by Pang would be used as Pang’s living expenses until she passed away.  Man believed that if Pang had any difficulty collecting rent from the Leung family, she would have told him.  As her son, Man would certainly deal with the matter for her.

14.  While it is true that Man did not state in his evidence that he directly witnessed Pang collecting rent from Kwok.  His evidence did support the reasonable inference that rent must have been collected by Pang from the Leung family from the time of the 1979 TA until 2003 when Pang was staying at elderly home.  Otherwise, Pang would certainly have raised complaint with her son Man, who became the registered owner on 25 May 1995.

15.  In making my finding that Pang did collect rent from Kwok from the time of the 1979 TA until 2003, it was sufficient for me to rely on the direct evidence of Hau alone.  Even without Man’s evidence on this aspect, my finding would have been the same.   

16.  So it is wholly incorrect for Mr Lam to say that I reached my finding based on hearsay evidence.  I reached my finding because I accepted the direct evidence of Hau.

17.  Also, Mr Lam criticised me for not considering Section 49 of the Evidence Ordinance before accepting hearsay evidence.  Section 49 is about considerations that are relevant to weighing of hearsay evidence.  As already said, the finding on collection of rent was based on the direct evidence of Hau, rather than hearsay evidence.  Mr Lam’s criticism is unwarranted.

18.  The only reference to Section 49 made by D2 and D3’s trial counsel was paragraph 16 of their closing submissions where they invited the court to attach no weight to the evidence of plaintiff’s witnesses ie Man, Hau and Sheung on the ground of hearsay evidence.  With respect, the trial counsel made this submission due to their failure to realise that Pang’s collection of rent from Kwok was direct evidence of Hau.  As such, it was unnecessary for me to discuss Section 49 at length. 

19.  In paragraph 118 of the Judgment, I already stated that both sides’ arguments had been considered and it was unnecessary for me to deal with each and every pointed raised.  This is especially so when I already spelt out the reasons as to why I accepted the evidence of the plaintiff’s witnesses. See: paragraphs 60, 81, 93, 94, 95 and 102 of the Judgment.

20.  Mr Lam also attacked the Judgment on the ground that my finding was inconsistent with the case of the plaintiff.  The plaintiff’s case is that after the expiration of the 1979 TA, there was a one-year tenancy which was renewed year after year until the 2005 TA was entered into.  I would say that my finding is not much different.  The plaintiff’s case did not address the point about the exact identity of the parties to the yearly tenancy.  After considering the events of the death of Man Senior on 18 May 1979, Man becoming the registered owner of the Premises on 25 May 1995 and Leung Senior’s death on 26 May 2001, I formed my own view on the identity of the parties to the yearly tenancy as spelt out in paragraphs 56 to 80 of the Judgment.  My conclusion is that from the time of the 1979 TA up to 19 July 2010, D2 and D3 had been occupying the Premises as agents and/or licences of the tenants.  On this aspect, my conclusion was not different from the case of the plaintiff.  In any event, I do not see any legal rule which requires that the trial judge to accept in full either the plaintiff’s case or the defendant’s case.

GROUND 2 - NO SUFFICIENT DEGREE OF CONTROL BY D2 & D3

21.  The second ground raised by D2 and D3 is that I erred in my ruling that D2 and D3 did not have a sufficient degree of control of Premises and that paragraph 10 and paragraph 82 of the Judgment are contradicting each other.

22.  This ground shows that Mr Lam is taking of individual paragraphs of the Judgment out of their context.  While it is true that the plaintiff did not dispute the possession of the Premises by D2 and D3, the plaintiff was not admitting the structures and utilities erected and activities allegedly carried out by D2 and D3 on the 18 Lots of which the Premises formed a part.  The alleged structures, utilities and activities were referred to in paragraphs 36 and 37 of the Judgment and the plaintiff’s position can be seen in paragraph 7 of the Amended Reply and Defence to Counterclaim Against D2 and D3.

23.  D2 and D3’s case is adverse possession.  It is trite law that “trivial acts will rarely suffice to establish adverse possession.”  (See: Paragraph 35-018, Megarry & Wade: The Law of Real Property, 8^th Edition).  Apart from D2 and D3’s unilateral allegation that the structures, utilities and activities were on the 18 Lots of which the Premises formed a part, there was no evidence to prove that these alleged structures, utilities and activities (if existed at all) were on which parts of the 18 Lots and whether they related to the Premises at all or their scale.  According to D2’s version, the Premises alone occupy 7,000 to 8,000 square feet.  In the absence of surveyor’s evidence, there was a loophole in the case of D2 and D3.  It was on this basis that I made the ruling that they had failed to prove a sufficient degree of control of the Premises for a period of 20 years from 1 March 1984.

GROUND 3 - D1 AS SISTER OF D2 & D3

24.  Mr Lam seeks to challenge my finding that D1 as daughter of Leung Senior and sister of D2 and D3.  I already gave the reasons for my finding at paragraph 76(a) to (k) of the Judgment.  I also dealt with the counter argument raised by D2 and D3 based on the marriage certificate of D1 at paragraph 77 of the Judgment.

25.  Obviously, D2 and D3 might not agree to my finding.  But disagreement with a finding of fact does not amount to a ground of appeal, in the absence of reasons for disagreeing.

26.  While Mr Lam is emphasising his disagreement with my finding of fact, he has not attempted to provide an explanation for the lacuna I pointed out in the case of D2 and D3, namely, why would D1, alleged by D2 and D3 to be a total stranger, would bother to enter into the 2005 TA and pay rent for 2005 and 2006 but never took possession of the Premises?  (See: Paragraph 76(i) of the Judgment)

27.  Mr Lam also made the criticism that I tried to find an excuse for the plaintiff in paragraph 77 of the Judgement where I stated the following:-

“… The possible explanation might be the one given by D2 and D3 themselves. D1 left home in around 1976 to 1977 because Leung Senior and his wife forced her to get married. As a result, the relationship between D1 and Leung Senior turned sour. When D2 got married on 23 May 1983, she did not want to involve Leung Senior and simply stated her father as deceased.”

28.  D2 and D3 only spelt out the reason for D1’s leaving home around 1976 to 1977.  The latter part was my interpretation as to what might have happened.  As trial judge, I believe I am entitled to draw any reasonable inference from facts not in dispute.  This is far from finding an excuse for the plaintiff as alleged by Mr Lam.

29.  Even if my finding that D1 as daughter of Leung Senior and sister of D2 and D3 is wrong, I already provided an alternative finding in paragraph 78 of the Judgment.  D1 must a least be a person closely related to the Leung family including D2 and D3.  Otherwise, she would not have entered into the 2005 TA and paid rent for 2005 and 2006.

GROUND 4 - WRONG CONCLUSION ON THE OVERALL CREDIBIILTY OF THE WITNESSES

30.  Mr Lam’s criticises my acceptance of Hau’s evidence and rejection of D2 and D3’s evidence.  His grounds are these:-

(a)  The trial judge disregarded the discrepancies in the evidence of Hau (See: Paragraphs 94 to 95 of the Judgment);

(b)  The trial judge took into irrelevant matters and/or over emphasised trivial matters in relation to the evidence of D2 and D3 in the following paragraphs of the Judgment:-

(i)  Paragraph 96;

(ii)  Paragraph 97;

(iii)  Paragraph 98;

(iv)  Paragraph 99; and

(v)  Paragraph 101.

31.  With respect to Mr Lam, this so-called ground is not a ground at all.  In fact, I considered the inconsistency in Hau’s evidence and gave the reason for accepting her evidence despite the inconsistency in paragraphs 94 to 95 of the Judgment.  Mr Lam has failed to read the paragraphs properly.

32.  As to the loopholes in D2 and D3’s evidence pointed out by me in paragraphs 96, 97, 98, 99 and 101 of the Judgment, Mr Lam tries to explain these away by saying that they are irrelevant and trivial.  With respect, I am afraid Mr Lam is adopting a double standard, one standard for the plaintiff’s witnesses and another standard for D2 and D3.  That is, inconsistencies in the evidence of the plaintiff’s witnesses should not be disregarded but inconsistencies in the evidence of D2 and D3 should be regarded as irrelevant and trivial.

33.  A trial judge must assess the witnesses’ testimonies and decide which witness’s evidence is accepted and which witness’s evidence is rejected.  Just because the evidence of one party’s witnesses is rejected is not a ground for application for leave to appeal.

34.  Paragraph 59/0/53 of Hong Kong Civil Procedure 2018 spells out the trial judge’s duty and advantage in the assessment of witnesses’ testimonies which I find instructive:-

“A distinction must be drawn between the judge’s view of conflicting testimony, and the inferences to be drawn from facts not in controversy (per Lord Denedin in Dominion Trust Co. v. New York Life Insurance Co. [1919] A.C. 254 at 255, PC) or between facts deposed to by witnesses and found by the court, and inferences of fact drawn therefrom (see Benmax v. Austin Motor Co. Ltd [1955] 1 All E.R. 326, per Viscount Simonds at 327).  “The judge sees the demeanour of the witnesses and can estimate their intelligence, position and character in a way not open to the courts who deal with later stages of the case” (Khoo Sit Hoh v. Lim Thean Tong [1912] A.C. 323 at 325, PC).  Not to have seen the witnesses puts appellate judges in a permanent position of disadvantage against the trial judge, and unless it can be shown that he has failed to use or has palpably misused his advantage – for example has failed to observe inconsistencies or indisputable fact or material probabilities (ibid. and Yuill v. Yuill [1945] P. 15; Watt v. Thomas [1947] A.C. 484) – the higher court ought not to take the responsibility of reversing conclusions so arrived at merely as the result of their own comparisons and criticisms of the witnesses, and of their own view of the probabilities of the case (per Lord Sumner in S.S. Hontestroom (Owners of the) v. S.S. Sogaporack (Owners of the) [1927] A.C. 37 at 47).  In Ting Kwok Keung v. Tam Dick Yuen & Others [2002] 3 H.K.L.R.D. I, Bokhary P.J., in considering those circumstances when an appellate court could properly disturb findings of fact made by a trial judge, discusses the respect due to findings of primary fact made by trial judges who enjoy the advantages which come from receiving the evidence at first hand.  Bokhary P.J. (with whose judgement the other members of the Court of Final Appeal agreed) said that where the Court of Appeal is satisfied that the conclusion reached by the trial judge on the facts was plainly wrong, it should intervene.  If the Court of Appeal is not so satisfied, it should defer to the trial judge’s conclusion even if in doubt as to its correctness.  Where a defendant has been acquitted of fraud, the decision should not be displaced on appeal except on the clearest grounds (Akerhielm v. De Mare [1959] A.C. 789; [1959] 3 All E.R. 485, PC).  If the trial judge’s estimate of the man forms any substantial part of the reasons for his judgment his conclusions of fact should be let alone (ibid. and see Powell v. Streatham Manor Nursing Home [1935] A.C. 243).  But while the Court of Appeal is always reluctant to reject a finding by a judge of the specific or primary facts deposed to by the witnesses, especially when the finding is based on the credibility or bearing of a witness, it is willing to form an independent opinion upon the proper inferences to be drawn from it (Benmax v. Austin Motor Co. Ltd above; and see Montgomerie & Co. v. Wallace-Jones [1904] A.C. 73 per Lord Halsbury L.C. at 75; Mersey Docks & Harbour Board v. Procter [1923] A.C. 253, per Viscount Cave L.C. at 258); (See also para. 59/10/28).”

CONCLUSION

35.  As D2 and D3 have failed to convince me that they have a reasonable prospect of success if the case goes to appeal, their application for leave to appeal must be dismissed.  In such circumstances, I see no reason for ordering a stay of execution of the Judgment.

36.  Costs should follow the event.  I make a costs order nisi that the 2^nd and 3^rd defendants do jointly and severally pay the costs of this application for leave to appeal, to be taxed if not agreed, with certificate for counsel.  The costs order nisi shall become absolute in the absence of application to vary within 14 days.