LAI FUNG TIN v. JOHN, DONALD CHUKWUZITERE

LDPE 376/2021

[2021] HKLdT 41

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

APPLICATION NO. LDPE 376 OF 2021

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J U D G M E N T

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Background

1.  This is a dispute between a landlord and tenant concerning a shop without electricity supply.

2.  By a tenancy agreement dated 29 December 2020 (“the Tenancy Agreement”), the applicant let to the respondent Shop 8, 2/F, Mirador Mansion, 58 Nathan Road, Kowloon (“the Property”) for a term of 2 years from 15 January 2021 to 14 January 2023 at a rental of $9,000 per month (inclusive of government rent, rates and management fee). But by a break clause in Schedule II to the Tenancy Agreement, either party can terminate the tenancy by serving not less than 1 month’s written notice or by paying 2 months’ rent in lieu to the other party provided that the said written notice shall not be served before the expiration of the 11^th month of the term of the Tenancy Agreement.

3.  In the Remarks column of the Tenancy Agreement, it was specifically stated that the tenant would do the interior renovation.

4.  On 29 March 2021, the applicant applied to the Tribunal for recovery of possession of the Premises on the ground that the respondent had failed to pay rent since 15 February 2021.

5.  On 1April 2021, the respondent filed a Notice of Opposition stating, inter alia, that the rental was yet to be paid because the applicant had failed to keep her promise which was disclosed on the first hearing on 22 April 2021 to provide electricity to the Property.

6.  The case was adjourned for trial on 20 May 2021 so that both the applicant and the respondent can serve their corresponding witness statements on or before 14 May 2021.

Witness Statement of the Applicant

7.  In her witness statement filed on 14 May 2021, the applicant gave the following statements:

“3. The Property was introduced to me by an estate agent Ms May Choi. At the time of viewing the Property, I was told by the said estate agent that there is no electric meter in the Property which means both myself and the estate agent are fully aware on electricity matter.

4. After signing of the Sale and Purchase Agreement, I became the registered owner of the Property on 18^th March 2020. Thereafter I asked the said estate agent to place the Property on open market for lease.

5. On or around end of December 2020, I was told by the said estate agent that the Respondent requested her to take him to view the Property. Thereafter he informed the said estate agent that he decided to rent the Property knowingly that the Property has no electricity supply therein.

6. On signing of the Tenancy Agreement on or around 29^th December 2020, the said estate agent specifically put in a clause into the Tenancy Agreement, namely the Tenant (the Respondent) will (be) responsible to do the interior decoration. So if the Tenant requires electricity, he will need to apply electricity directly from the electric company. The Respondent and I both acknowledge the meaning of this clause by initialling next to the said clause…

7. …

8. Although the commencement date of the tenancy was set on 15^th January 2021, the Respondent asked for a “rent free period”[1] to start his renovation. I nevertheless have agreed to allow him to have the rent free period up to 14^th January 2021, ie before the commencement of the tenancy. By reason of that keys to the Property were given to the Respondent.

9. During the Respondent’s renovation, the Respondent kept asking me whether I could assist or help him on his electricity fitting problem. Although I understand that I need not assist or help the Respondent in anyway in his renovation, I have once again agreed, with a view to maintain better landlord and tenant relationship, to put in a Miniature Circuit Breaker “Fuse Box”) inside the said Premises without charging the Respondent so that his electric technicians could connect the interior wiring into the Fuse Box and also apply for the meter from the electric company…

10. Despite all my extra help to the Respondent on fixing the Fuse Box as aforesaid and even suggested to allow him to postpone the commencement date of tenancy until he has completed his electricity renovation, the Respondent refused to pay for his electric technicians to complete the wiring work and even turn around to say that I should pay for the technicians and apply for the electric meter for him which I have never agreed upon…

11. As far as I know that requiring for an electric meter for electricity, the electric company will require a deposit which, in a usual rental situation, the tenant will need to pay for and upon termination of the tenancy, the tenant will then ask the electric company for the refund of the said deposit.

12. If the Respondent’s intention is to ask for the landlord to put to apply for an electric meter for him, then he should have stated clearly of his intention before signing of the Tenancy Agreement so that I could consider whether or not to rent the Property to him.

…”

Witness Statement of the Respondent

8.  The respondent’s statement filed on 13 May 2021 comprised the following:

“As i am writing this statement she has failed to keep to her words, i am not going to state much here because facts speak for itself which is with the court and her lawyer. When she promise to install the electricity i do not even know that her property have no electric meter and she never said that to me.

How on earth could any human run a business on the peninsula of Hong Kong without electricity, i would need an answer to that.

At the same time i have agreed to her both suggestion, extending to the rent new kick starting date until she install the power, another of her suggestion is to cancel the agreement and refund my money, which i also accepted with full amount of all that i have spent…”

9.  While the respondent’s statement was relatively short, it attached the following WhatsApp messages with the applicant:

Date	Applicant/Respondent		Content
13 January 2021	Applicant: (18:15)		Sorry Mr John I can’t hear you well from your recording .. can you type it out what you need?
		Respondent: (18:18)	That was when I asked the electrician to send me his best price to do the wiring, after he send it which is 8,600, he followed it up with his voice explaining what he will be buying to do the work, which you can hear very clearly
	Applicant: (18:26)		I am not exactly sure what you  need to be done in order to have approval from CPL[2]… My recommendation would be to get a certified electrician to complete the work. Reason being is my certified electrician Mr Ho, has also taken a quick look at your interior part (electricity setup) and he said likely CPL will not give us approval for that (following which is a screenshot message): Applicant:「謝謝你， 何師傅同阿May嘅時間 何師傅， 請你告訴阿May有啲乜嘢仲需要完成. Thanks」 Mr Ho：「室內基本須要照明， 插蘇， 冷氣供電 （曲架制）」「因為申請60A單相電錶單靠幾支光管係唔會批」
		Respondent: (18:33)	Well you know that you have an electrician to do this job but you have refused to do that, so I get other people to do it and when they finish you have to balance up this money. I can’t wait until eternity for you to fix your own property light
		Respondent: (18:48)	They have buy the pipes to fix/wire your property, anyway they buy the right and standard fittings/parts, so I don’t see why it will not be approved
14 January 2021
		Respondent: (11:56)	Good morning miss Lai Would like to know if this electrician finishes wiring today can the CLP come today to install the meter?
		Respondent: (12:21)	That is your certified electrician work, hi work is bad and need to be corrected, I’m doing it now
	Applicant: (12:50)		Hi Mr John we have asked our certified electrician to fixed your interior electricity by Sunday and CLP will come to provide the approval. So please stop any electric projects that’s occurring now.
	Applicant: (13:25)		How about we extend the start of the lease until electricity is ready? So you don’t have to rush. (to be clear: we will not be covering any of the cost you will or have paid for your technicians) Let me know what you think?
		Respondent: (13:29)	Sorry you have to over it, (the electrician charges) I told you before now, check your messages anyway
		Respondent: (14:34)	Get my light working on or before 15th of January 2021, since 28th of December when the contract was signed you have intentionally refused to install Electricity inside your property, I head you say you will refund my and take back the place, fine and well but you must pay all that I have spend to buy equipments, furnitures and other mercelenious, please take note
		Respondent: (23:39)	Well miss Lai, hope to see you and that your lawyer at the court of law, as you intentionally cheated on me, I’m so sorry that this your senseless message here shows how you criminally cheat and intimidate people, my own lawyer will get to you soonest. You cheat and liar how dare you? you will have to pay all that I have spent in this shop. I can’t and will never install Electricity in your own property, it’s impossible on the face of this planet ok. You promised to install Electricity in this shop but you have failed to do so. Once I install Electricity here you must pay it in full, mind you that have breached our contract. From 28/29th of December that I paid in full and signed a contract with you, up to date you have intentionally failed to install Electricity here. Now you’ve the got to send this rubbish of yours. Lets see where this ends ok.

10.  The respondent sent further messages to the applicant afterwards but it appears that the applicant never responded then.

11.  Attached to the respondent’s statement are also Messages messages with somebody of telephone number of 6332 xxxx which the respondent referred to as the estate agent, Ms May Choi:

Date	Somebody/Respondent		Content
4 January 2021
		Respondent: (17:02)	Please help me, I want this light to be fixed today, the workers are not doing anything now, and the glass they should fix it immediately please, thank you
	Somebody:		We’ve checked with the electricity company, and they said your unit doesn’t have any electricity meter so we already asked them in urgent to solve the problem. They said the fastest they can manage to come in a few days time, please be patient.
		Respondent:	But how can the workers do the work now?
	Somebody:		We are sorry but there is nothing we can do, we already tried our best to help and asked the electricity company to fix the problem as soon as possible
8 January 2021	Somebody: (13:12)		The landlord already applied the electricity for the shop, and the electric company will come and do the installation. But you must remove all the electricity connection you have now at the shop, inorder the electric company to start their work.
		Respondent:	Tell her that this is her shop and should do all this, not us to do it. So she should tell the guy to come and do it now, now. We tried already a d no more wasting time
	Somebody:		But this is do by the tenant because it’s your air conditioner please help just fix little things thankyou sir
		Respondent:	Tell her we buy air-conditioner It’s ok, but she must connect electricity in her property, no where in the world any body does that ok
	Somebody:		Yes but just put on the button for your air conditioner and we can apply for more electric please help
		Respondent:	Tell her that she has breached our contract terms but I’m not complaining, let her fix this light for us today otherwise I will not be happy Also she don’t know what she is talking, in Hong Kong every house uses air-conditioner, so what is she talking about?
	Somebody:		The landlord will apply for the electricity supply at the premises for you but the interior electricity installations and the plugs the tenant should be responsible. We’ve already transferred your words to the Landlord. We’ve already tried our best and cannot do anymore things to help. If or anything please contact the landlord directly.
		Respondent:	Thank you, but I will not be responsible for wiring of her property, it’s her property and therefore should do the things she is supposed do, she is not decorating nothing as this does not amount to that, she is not doing for me but for herself ok, tell her
		Respondent:	I will not talk about this again, if I don’t see all thing done by tomorrow I will do and the bill to her and that’s the final, what ever they charge she has to pay it, let her tell her Chinese electrician to do it now, so all this while no body applied for anything, this is too bad
19 January 2021		Respondent: (17:46)	Why up to now no body here to do the electric? What is today’s date? And you are yet to provide me with electricity in your property you rented to me and collected full money on the 28/29th  of November 2020, this is no longer funny for all that you are doing is intentional, I’m just watching with some keen interest.
	Somebody:		Send (the above messages) to the landlord already
21 January 2021		Respondent: (11:35)	Still counting, it goes on and on ya
	Somebody:  (14:36)		(A screenshot message showing: 「Hi May, 我已揾人處理， 你可以唔使理佢」)
26 January 2021		Respondent: (20:21)	Lai today is gone again, you never heed to my advice, go get the lights in your property connected, get the meter for this is ur property, thereafter change it to my own name, I have shown you how kind person that I am, please once again get this your property electric fixed, you will be responsible for what ever I lost, take note I have tried but I guess that your lawyer tells you that nothing will happen because you don’t tell the truth to them, enough I have tried, please talk to this woman, talk to her now, I mean now. Thank you
	Somebody:		Transferred your msg to the landlord already

Trial on 20 May 2021

12.  At the beginning of the trial, during the examination in chief, the applicant said she could not recognize to whom the telephone number of 6332 xxxx belonged. Then when the cross-examination started, the respondent drew the applicant to the attention of the screenshot message on 21 January 2021, the applicant said again she could not recognize the telephone number on the screenshot which is +852 902… The applicant also said she was not sure whether the screenshot message came from her phone.[3] However, as it transpired and the applicant acknowledged moments later during re-examination[4], +852 902… is her telephone number and May should be her estate agent Ms May Choi.

13.  Also the respondent played an audio recording of what happened in the afternoon of 14 January 2021 at the estate agent’s office[5]:

(1)  The applicant squabbled that everything inside the Property should be done by the respondent because she had no idea how the respondent would intend to renovate the Property.

(2)  The respondent complained that the applicant had breach the Tenancy Agreement.

(3)  The applicant referred to the Remark in the Tenancy Agreement that the tenant would do the interior renovation.

(4)  The applicant said she had promised to help the respondent fix the electricity[6].

(5)  The respondent suggested they would cancel the Tenancy Agreement and he got the refund of what he expended. The applicant translated it in Chinese to a male person who was also present during the conversation.

14.  The respondent questioned the applicant why she or her estate agent did not tell him that the Property had no electricity meter. The applicant explained that she never met the respondent before signing the Tenancy Agreement. She just signed the Tenancy Agreement when it was passed to her by Ms May Choi (in the absence of the respondent).

15.  The respondent put to the applicant that if she ever said she would not fix the electricity meter. The applicant answered she never promised anything.

Discussion

16.  It is true from the above that the applicant wanted to deny she had ever promised to the respondent that she or her estate agent would fix the electricity supply to the Property. To the extent that the applicant even denied recognising her own telephone number, she was not a reliable witness. The applicant also evaded to explain why the Tenancy Agreement started on 15 January 2021 although she stated in her witness statement that the respondent asked for a “rent free period” to start his renovation. She tried to deny everything whatsoever.

17.  Notwithstanding the above, the respondent conceded, in his closing submission, that nobody told him that there was no electricity meter at all in the Property when he signed the Tenancy Agreement.[7] Then comes the question whether the estate agent, Ms May Choi, who was then acting on behalf of the applicant, promised to the respondent that the applicant would fix the electricity supply before contract started.

18.  On the balance of probabilities, I do not think so.

19.  Firstly, it was written down in the Tenancy Agreement that the tenant would do the interior renovation. While the respondent disputed that the term did not include the electricity supply which was supposed to be the responsibility of the landlord, I agree with Mr Joseph Leung (“Mr Leung”) of Messrs Joseph Leung & Associates, ie the solicitor acting on behalf of the applicant, that the promise of electricity supply, if any, as it was so important, would have been specified in the Tenancy Agreement.

20.  The truth or reality of what happened can be discerned from the messages exchanged between the respondent and the somebody which I believed was the estate agent, Ms May Choi though the applicant refused to identify[8]. The messages, which were produced by the respondent himself, started on 4 January 2021 when the respondent asked for help:

“Please help me, I want this light to be fixed today, the workers are not doing anything now, and the glass they should fix it immediately please, thank you.”

21.  If the applicant or Ms May Choi on her behalf had promised to fix the electricity supply before contract started, the respondent would not have called in the workers so soon before the electricity supply was in place. It can also be discerned from the reply from Ms May Choi that: “… we already tried our best to help and asked the electricity company to fix the problem as soon as possible.” Ms May Choi did not state or hint that it was the landlord’s responsibility.

22.  It was only on 8 January 2021 that Ms May Choi informed the respondent that “The landlord already applied the electricity for the shop, and the electric company will come and do the installation.” If the applicant or Ms May Choi on her behalf had promised to fix the electricity supply before contract started, why the respondent had called in the workers even before the applicant applied the electricity for the Property.

23.  The following messages from the respondent also showed his attitude or understanding:

“Tell her that this is her shop and should do all this, not us to do it.”

“Thank you, but I will not be responsible for wiring of her property, it’s her property and therefore should do the things she is supposed do, she is not decorating nothing as this does not amount to that, she is not doing for me but for herself ok, tell her”

Again, the respondent never stated that the applicant or Ms May Choi on her behalf had promised to fix the electricity supply before contract started. The respondent only thought that it was the applicant’s responsibility to fix the electricity.

24.  In common law, however, there is in general no implied warranty on the part of a landlord that the demised premises are fit for the purpose for which they are taken. The intending tenant is presumed to make his own inquiries as to its condition, and, in the absence of a special stipulation, he takes the premises as they stand, even without electricity supply.[9]

25.  In Fortune Global Development Ltd v Shung Cheong Food Trading Ltd [2002] 2 HKLRD 447, while the above principle was repeated, it also held that there was no duty on the parties to a contract to disclose material facts to each other, however dishonest such non-disclosure may be in particular circumstances, and in the absence of special circumstances, mere non-disclosure does not constitute misrepresentation. The rule of caveat emptor applies and the respondent has to rely on his own inspection to identify the problem if any.

26.  The respondent relied heavily on the conversation with the applicant on 14 January 2021 when the latter said she had promised to help the respondent fix the electricity. On the one hand, the applicant only used the word “help” instead of admitting liability. Indeed, the respondent responded angrily that the applicant was not helping him but herself because it was her own Property. The respondent did not refer to any earlier promise by the applicant or Ms May Choi on her behalf that the applicant would fix the electricity supply before contract started.

27.  The respondent also referred to the conversation on 14 January 2021 that the applicant said she would agree to cancel the Tenancy Agreement and refund the deposit he paid[10]. But the respondent stated that in such event, he would expect the applicant to reimburse him all expenses he incurred, including the costs of the workers he called in. Unfortunately, as affirmed by the Court of Appeal in Shun Ho Energy Development Company Limited & Others v Golden Crown Industries Limited, CACV 161/2014 (unreported, 30 June 2015), a counter-offer amounts to rejection of the offer and once an offer is rejected, the offeree cannot revive it unilaterally by saying that he has later accepted it.

28.  Similarly, the respondent referred to an earlier WhatsApp message from the applicant on the same day:

“How about we extend the start of the lease until electricity is ready? So you don’t have to rush. (to be clear: we will not be covering any of the cost you will or have paid for your technicians) Let me know what you think?”

29.  There was no acceptance of the offer (if this was not just an invitation to treat) but the respondent responded instead: “Sorry you have to over (sic) it, (the electricity charges) …” Absent such an agreement, the respondent’s assertion that the Tenancy Agreement would be extended to a rent new kick starting date until the applicant has installed the electricity power is misconceived.

30.  It is also a pity that absent such an agreement, the respondent has to pay rent according to the Tenancy Agreement.

Conclusion

31.  In view of the above, I make the order as follows:

(1)  Subject to paragraph (4) below, the respondent do deliver vacant possession of the Property to the applicant;

(2)  The respondent do pay the applicant arrears of rent/mesne profits from 15 February 2021 until delivery up of vacant possession, at the rate of $9,000 per month;

(3)  The respondent do pay the applicant the costs of this application, which as assessed in accordance with the statement of costs dated 20 May 2021 prepared by Mr Leung, in the sum of $60,000.00.

(4)  If the respondent should on or before 21 June 2021 (“Relief Expiration Date”) pay into the Tribunal all the arrears of rent/mesne profits as stated in paragraph (2) above (including all arrears of rent/mesne profits due on or before the date of payment) together with the costs referred to in paragraph (3) above, the respondent be relieved from the forfeiture incurred herein, and the Tenancy Agreement of the Property be reinstated.

(5)  Unless otherwise ordered, all sums ordered to be paid under this judgment shall be paid into the Tribunal in cash, by EPS, by cashier orders issued by banks in Hong Kong or by cheques drawn by firms of solicitors in Hong Kong, and such sums received by the Tribunal shall be released to the applicant.

 

[1] This “rent free period” was not mentioned in the Tenancy Agreement.

[2] This I understand referred to CLP Power Hong Kong Limited.

[3] Hearing time at 10:13.

[4] Hearing time at 11:04.

[5] The playback started at 10:31 and there was a replay at 10:56.

[6] Hearing time at 10:34.

[7] Hearing time at 11:33. 11:42 and 11:55.

[8] Perhaps Ms May Choi used a different telephone number when she communicated with the respondent.

[9] See Halsbury’s Laws of Hong Kong, Volume 36, [235.300], Second Edition. 2018.

[10] Indeed, according to the audio recording, the applicant was just repeating the suggestion by the respondent to the male person at the estate agency.