THE INCORPORATED OWNERS OF HUNG WAI BUILDING v. SUNNY ELEGANT LTD AND OTHERS

LDBM 76/2019

[2022] HKLdT 42

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

BUILDING MANAGEMENT APPLICATION NO. 76 OF 2019

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D E C I S I O N

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A.  Introduction

1.  The 4 Respondents applied by summons filed on 15 June 2022 for leave to adduce expert evidence on liability on 5 issues set out in paragraph 1 of the said summons (the Leave Application).  The names of the two experts nominated by the 4 Respondents are set out at paragraph 2 of the said summons.

2.  Among the said 5 issues set out in the Leave Application, issues (2), (4)  and (5)  are as follows:-

(2) As a matter of design, whether the 1^st Respondent, as the owner of all the units on 1/F of the Building is obliged to provide access to the 1/F electrical room to the Applicant.

(4) Whether, subject to access to qualified technicians thereto, in the absence of access by the Applicant to the 1/F electrical room, the general safety of the owners and occupiers of the Building (other than that of the 1/F units)  might be jeopardized.

(5) As a matter of design, whether the Staircase and Stair Landing connecting the Entrance Space at Shop No.8 and the corridor and the Toilets on the 1/F was intended to be used[1] for (a)  the building as a whole or (b)  the 19 Offices on the 1/F.

3.  Solicitors for the 4 Respondents, Mr Wong Kam Mun (Mr Wong), had prepared his 3^rd Affirmation dated 14 June 2022 (the 3^rd Affirmation)  in support of the Leave Application.

4.  On 6July 2022, the Leave Application was heard by this Tribunal.  Ms Vivian Li (Ms Li), counsel for the 4 Respondents, withdrew the Leave Application in respect of issue (3)  and proceeded with the remaining issues.  Counsel for the Applicant, Ms Becky Wong (Ms Wong), objected to the rest of the Leave Application.

5.  After hearing submissions from Ms Li and Ms Wong, I dismissed the Leave Application in respect of issues (2), (4)  and (5)  but gave leave to parties to instruct a single joint expert (SJE)  to give opinion on issue (1)  reformulated as follow (the Order): -

(1) for all electrical facilities installed inside 1/F electrical room from 2017 to the present, identify each of them by equipment name and explain the function of each of them (whether in terms of electricity supply, measurement of electricity consumed or otherwise).

6.  On 20 July 2022, the 4 Respondents filed their summons and the 4^th Affirmation of Mr Wong (the 4^th Affirmation)  applying for leave to appeal from the Order to the Court of Appeal on the grounds set out in the 4^th Affirmation and the questions of the law to be determined by the Court of Appeal are said to be set out therein (the Leave to Appeal Application).

7.  As the Leave to Appeal Application was considered suitable to be disposed of on papers, this Tribunal gave direction to that effect to the parties, including giving directions for them to lodge and serve written submissions and authorities.

8.  Mr K. M. Chong (Mr Chong)  and Ms Li appear for the 4 Respondents on the Leave to Appeal Application while the Applicant remains represented by Ms Wong.  On 8 August 2022, Mr Chong and Ms Li lodged written submissions and draft Notice of Appeal (Draft Notice)  on behalf of the 4 Respondents.  On 15 August 2022, Ms Wong lodged written submissions on behalf of the Applicant.  The 4 Respondents did not lodge any reply submissions thereafter.

B.  Applicable laws on leave to appeal

9.  Any party to the proceedings before the Tribunal may appeal to the Court of Appeal against a judgment, order or decision of the Tribunal on the ground that such judgment, order or decision is erroneous in point of law: s.11(2)  of Lands Tribunal Ordinance, Cap.17 (LTO).

10.  A party wishing to lodge an appeal must apply to the Tribunal for leave to appeal first: s.11AA(1)  of LTO and r.30B(1)  of Lands Tribunal Rules, Cap.17A.

11.  Leave to appeal shall not be granted unless the Tribunal is satisfied that the appeal has a reasonable prospect of success or there is some other reason in the interests of justice why the appeal should be heard: s.11AA(6)  of LTO.

C.  Applicable principles on expert evidence directions

12.  The Court of Appeal had recently summarized and set out the principles which guide the Court in determining if expert evidence should be admitted[2]. The pertinent ones are reproduced in this section below.

13.  Substantive conditions to be met for expert evidence to be admissible are: -

(a) The subject matter of the opinion must fall within an area in which expert evidence may properly be given;

(b) The witness must be qualified as an expert to give the evidence of the type in question; and`

(c) His evidence must be relevant to the issues being litigated.

14.  Evidence meeting condition (a)  can still be excluded by the Court if the Court takes the view that calling it will not be helpful to the Court in resolving any issue in the case justly.  Such evidence will not be helpful where the issue to be decided is one on which the Court is able to come to a fully informed decision without hearing such evidence.

15.  After implementation of Civil Justice Reform, in addition to the substantive conditions identified above, the use of expert evidence is subject to procedural requirements contained in the rules to guard against misuse or mismanagement of expert evidence.  Our courts can take account of the probative value of an expert report in exercising case management power.

16.  The giving of expert directions is very much a matter of case management.  Lack of proper preparation of expert evidence could result in unnecessary costs and time spent on evidence which is of no help to the resolution of the dispute.  Such wastage is not consistent with the underlying objectives of the Rules of High Court, Cap.4A (RHC).

17.  The party who seeks expert directions (who also bears the burden of persuading the court that expert evidence is helpful and appropriate)  should consider the materials to be presented to support the application more carefully.  In some cases, it may be useful to have the intended expert report at hand to explain to the court the nature of such evidence and to demonstrate the necessity for having such evidence.

18.  The court will not give directions for expert evidence to be adduced (carrying with it the incidence of substantial costs being incurred on its preparation and court time spent on the same)  simply on the basis that the court cannot rule out a possibility of such evidence being relevant and helpful in the sense as discussed above.  If the applicant for expert directions fails to persuade the court on relevance and necessity of such evidence, the application should be dismissed[3].

19.  Whether expert directions should be given or not and, if so, on what terms is ultimately a case management decision of the court.  Like other case management decisions, the Court of Appeal will be circumspect in interfering with such decisions and would not do so unless the decisions were not made in accordance with established principles or were otherwise plainly wrong.

D.  Issues joined by parties on the application

20.  The Applicant is the incorporated owners of the subject building (the Building) which comprises shops on G/F, office units on 1/F and two residential blocks.  The 1^st Respondent is owner of one G/F shop and many 1/F office units.  The 2^nd Respondent is the principal tenant of the said shop and office units.  The 3^rd and 4^th Respondents are the sub=tenants/licensees and occupiers of the said shop and office units.

21.  The parties are in dispute over 2 major areas of the Building.  The first area is the external wall of the Building and concerns some chimney.  That, however, does not feature in the Leave Application and is irrelevant for the Leave to Appeal Application.

22.  The second area in dispute concerns certain areas on G/F and 1/F of the Building.  They include a)  G/F entrance, staircases, staircase landing leading to 1/F; and b)  corridor and toilets on 1/F (the Disputed Areas).

23.  The Disputed Areas do not, however, include “the 1/F electrical room” referred to in issues (1), (2)  & (4)  in respect of the Leave Application.

24.  The Applicant says that the Disputed Areas are common parts. But the 4 Respondents contend that they are area of exclusive use privately owned by the Respondent(s).

25.  The Disputed Areas, said the Applicant, had been licensed to the Respondent(s)  for their use.  But the Respondents claimed that the 1^st Respondent had entered into that licence under misrepresentation of former chairman of the Applicant.  Induced by such misrepresentation, the Respondents, they claimed, had invested substantially in their G/F and 1/F premises to their detriment.  They put forward proprietary estoppel and/or estoppel by convention to prevent the Applicant from denying their continued use of the Disputed Areas.

26.  The Applicant claimed that the said licence had expired and/or had been terminated by notice in 2017 and/or 2018 and, notwithstanding notice given by Applicant’s solicitors, the Respondents had continued to occupy the Disputed Areas to Applicant’s exclusion by using the 1/F premises as a Chinese restaurant and a café, blocking the entrances, staircase and corridor, and thus converting the Disputed Areas to their own use.

27.  Moreover, in breach of s.34I(2)  of Building Management Ordinance, Cap.344 (BMO), the Respondents, the Applicant claimed, had used or permitted the Disputed Areas to be used in such a way to cause a nuisance or hazard to other persons lawfully in the Building i.e. by obstructing Applicant’s access to the 1/F electrical room by way of occupying the Disputed Areas as a café and by making decorations and erecting objects on the former 1/F corridors leading to the said room.

28.  According to the Applicant, there were installed inside the said room electrical facilities essential to the power supply or related to the power supply of the Building and that the said room is common part and that the facilities inside were common facility to be used and enjoyed by all owners of the Building.  The Respondents had obstructed all the owners of the Building having unrestricted and free access to this common part and the common facilities inside.  The Applicant had to ask for permission of the Respondent(s)  before being allowed entry to the said room during business hours and entry was further not available after business hours such that the Applicant could not respond in the event of any emergency after business hours.

29.  The Respondents, according to Ms Li’s oral submissions and clarifications at the hearing of the Leave Application, disagreed with the 1/F electrical room being common parts and suggested that it was private property owned by the 1^st Respondent.  The Respondents denied that the Applicant is entitled to have access to the said room or that they are obliged to provide access of the said room (allegedly private property)  to the Applicant.

30.  Installed inside the said room, said the Respondents, are not essential power supply facilities but mere meters for billing purpose that do not supply energy to the units of the Building.  Proper inspection to be conducted inside the said room could, they say, be carried out by Applicant’s qualified technicians alone.  Through its technicians, the Applicant, they say, had already been able to conduct proper inspection of the facilities inside the said room and that the general safety of all owners and occupiers of the Building had not been jeopardized at all.

31.  The pertinent pleas for parties’ respective cases on s.34I(2)  of BMO could be found at: -

(a) Paragraph 35B of Amended Notice of Application;

(b) Paragraphs 25 to 27 of Amended Notice of Opposition; and

(c) Paragraph 12(a)  of Reply.

E.   Ground of appeal re issue (5)

32.  At paragraph 7 of the 4^th Affirmation, paragraphs 11 and 12 of the Draft Notice, and paragraph 4 of Respondents’ submissions, it was complained that this Tribunal had erred in law in ruling that: -

(a) by looking at building and/or assignment plans and by looking at easily recognizable and easily identifiable entrances, exits, corridors shown thereon, the Lands Tribunal can make an informed decision on its own whether or not the two residential towers have their own self-contained entrances and exits, or whether or not their residents are entitled to use entrances and exits of the commercial premises on G/F and 1/F;

(b) there is nothing extraordinary or extraordinarily difficult about this case suggested in the 3^rd Affirmation such as to trouble the Lands Tribunal to enlist the assistance of expert to shed light on such entrances and exits easily recognizable and easily identifiable in such plans to be employed at trial; and

(c) the proposed expert evidence is thus not required to assist the Lands Tribunal to come to an informed decision on issue (5).

33.  Mr Chong and Ms Li made the following submissions.

(1) It is Respondents’ contention that the two residential towers are self-contained having their separate entrances and exits and, thus, there is triable issue as to whether or not the Disputed Areas are to be used as access for the Building as a whole or solely for the 1/F office units collectively.

(2) Resolution of issue (5)  goes beyond mere construction of documents.  The expert to be called would be armed with expertise or specialized knowledge by way of building practice prevailing at the time of submission of building plans to the Building Department and could have considered them, on top of building plans, in arriving at the design of the Building (as it now stands)  from its designer’s (or a professional)  point of view.

(3) This Tribunal, lacking aforesaid expertise or knowledge, needs to be assisted by an expert on whether there is any communal use, or any degree of communal use, of the Disputed Areas by the residential owners/occupiers and the commercial owners/occupiers or else it would be obliged to construe the reason for the design of the Building from a layman’s different point of view, having regard only to parties’ arguments based on bare assertions and their respective interpretations of such plans produced before the Lands Tribunal.

34.  For reasons below, I do not find the above ground of appeal (and submissions)  having any reasonable prospect of success.

(1) The Respondents had, I think, nowhere articulated, and never articulated, any specific prevailing building practice that their proposed expert possesses, if at all, that may assist this Tribunal in resolving the triable issue raised by issue (5).  Such alleged assistance to be afforded to the Lands Tribunal by their proposed expert by way of such alleged knowledge is, with respects, no more than bare assertion from their counsels and lacks evidential basis at all.

(2) There is also, I think, no basis, and it is wrong and speculative, for the Respondents to suggest that the Lands Tribunal would approach issue (5)  purely from a layman’s point of view and that such point of view must be different from that of the designer of the Building[4] or that of a professional.  The Lands Tribunal could equally consider the design of the Building as manifested by the way it was built and as evidenced by its building plans (and relevant assignment plans)  without, one thinks, any expert or professional assistance.

(3) It was, one should point out, never suggested by the Respondents that the Building was built with any complicated or state-of-art design or that the relevant building and assignment plans to be looked at have any words or terms of art or science[5] appearing thereon making it difficult for the Lands Tribunal to understand on its own.

(4) The single aspect of the design of the Building to be considered in resolving issue (5)  is the layout of its entrances and exits.  The Respondents never saw fit to challenge this Tribunal’s ruling that there are easily recognizable and easily identifiable entrances and exits of the Building in its building plans and related assignment plans that the Lands Tribunal could properly look at, and consider, them on its own in understanding such layout[6].

F.   Grounds of appeal re issues (2)  & (4)

35.  At paragraph 12 of the 4^th Affirmation, paragraphs 11 and 12 of Respondents’ submissions, and paragraphs 17 and 18 of the Draft Notice, it was further complained that this Tribunal had erred in law in ruling that:-

(a) The issue of access to the 1/F electrical room in issue (2)  is purely a matter of construction of the deed of mutual covenant (DMC)  and application of the provisions of BMO, as, according to Ms Li, the parties differ on whether or not the said room is common parts and, if so, the Applicant would be entitled to have access to the said room;

(b) There is nothing extraordinary about this case which requires expert evidence to assist the Lands Tribunal on this dispute of the 1/F electrical room being either common parts or private property;

(c) Issue (4)  was badly or not clearly framed, and, in any event, framed in terms not directly related to the real issue joined by the parties on the application: -

(i) Subject to access provided to qualified technicians, issue (4)  was framed to suggest complete absence of access of the Applicant to the said room when the Applicant’s real complaint was about restriction of access to the said room in terms of timing, in terms of persons allowed entry and in terms of its ability to respond to emergency;

(ii) Such alleged safety concern complained of by the Applicant arose not from the alleged complete absence of access to the said room issue (4)  seems to suggest but from the different question whether or not the Applicant was in a position to maintain the common facilities inside the said room;

(iii) the real focus is thus on the Applicant’s ability to maintain the said facilities through proper and unrestricted access to the said room and not on the access itself as issue (4)  might suggest; and

(d) Having been assisted by expert on reformulated issue (1), the Lands Tribunal could make factual findings after hearing such rival factual evidence, if any, on restrictions regarding Applicant’s access to the 1/F electrical room (including that in the event of emergency)  and decide on its own whether or not general safety of the occupants of the Building might be jeopardized or that there posed a safety hazard to persons lawfully in the Building in terms of s.34I(2)  of BMO.

36.  Mr Chong and Ms Li made the following submissions.

(1)	The expert, if called on issue (2), would assist the Lands Tribunal on the issue of access by including not limited to looking at and comparing other switch rooms at other floors of the Building to the 1/F electrical room, and all other relevant technical factors.
(2)	The expert, if called on issue (4), would assist the Lands Tribunal from a professional technician point of view as to whether the general safety of the occupants of the Building would be jeopardized by looking at technical plans, primarily the electricity supply plans.
(3)	If the Lands Tribunal is to push for trial without expert evidence on issues (2)  and (4), it would be forced to construe or speculate the reason for the said room to be built at its location, the subject matter of its service compared with similar switch room built on each floor separately, especially the capacity of loading difference between the said room and those on the rest of the upper floors.  The design concept would be directly on both in respect of not only the electrical engineering, but also as to building design on the transfer bars.
(4)	Consideration of the Lands Tribunal, it was stressed, would be materially different from the consideration of the electrical engineer, having regard to not only the practice of designer of the Building for the said room to house meters and ducting, but also the practice of electrical engineer in the use of the said room against the design of the Building.  The matter is to be answered and construed from the perspective of expert, and not simply the plain and prima facie interpretation and bare arguments of parties.

37.  Again, I think this ground of appeal is (and the submissions above are)  completely devoid of merits.

(1)	Dealing with issue (2)  first, the Respondents had, I think, nowhere explained, and never explained, why it is felt necessary, having regard to issues joined by the parties on this application, for the proposed expert to look at, and compare the 1/F electrical room against, other switch rooms allegedly at other floors of the Building.
(2)	The Respondents had also, I think, failed to spell out what “other relevant technical factors” the proposed expert might usefully possess and consider in assisting the Lands Tribunal on its task of, according to Ms Li’s clarification, determining whether the 1/F electrical room is common part or private property.
(3)	In order to accomplish the above task, it is trite law that the Lands Tribunal has to construe the DMC to discover what a reasonable person would have understand its words to have meant, having regard to the DMC as a whole, the factual and legal backgrounds against which it was concluded and the practical objects which it was intended to achieve[7].  The construction of a document (like the DMC)  is a matter for the court and expert evidence is not admissible[8].  No authority contrary to the above propositions was cited by the Respondents.
(4)	Moving to issue (4), one also begs to ask what alleged assistance, if any, any proposed expert by way of professional technician could provide the Lands Tribunal by looking at alleged technical plans, primarily the electricity supply plans.
(5)	The Respondents had never seen fit to explain in the 3rd and 4th Affirmations, and it remains wholly unclear, to this Tribunal why one needs to consider reason for the 1/F electrical room to be built at its location, the subject matter of its service compared with alleged similar switch rooms built on each floor separately, especially the alleged capacity of loading difference between the said room and those on the rest of the upper floors.  The same applies to so-called design concept of the Building from the perspective of an electrical engineer, including so-called building design on the transfer bars.
(6)	Importantly, the above many submissions of the Respondents were, I must point out, made wholly divorced from, and without regard to, the real issues joined by the parties explained at paragraph [35(c)] above.  The Respondents had nowhere tackled this ruling of this Tribunal in their submissions or in the Draft Notice.
(7)	For the reasons above, this Tribunal’s ruling set out at paragraph [35(d)] above cannot be faulted at all.

38.  The Respondents separately complained at paragraph 22 of the Draft Notice, and paragraphs 16 and 17 of their submissions, that this Tribunal had failed to take into account that no real prejudice would be caused to the Applicant should the expert directions sought by them be granted (this ground of appeal, or question of law, was not raised in the 4^th Affirmation at all).

39.  Mr Chong and Ms Li submitted that: -

(1)	the Leave Application was made in a timely fashion before any milestone date has been fixed;
(2)	As such, it could not cause any real prejudice to the Applicant if granted;
(3)	If granted, the Leave Application could have brought much benefit to all parties by allowing this application to be expedited and disposed of by useful expert evidence and not purely by arguments raised by the parties; and
(4)	It is therefore consistent with underlying objective of RHC for the Leave Application to be granted as sought.

40.  With respect, the above submission is, I think, wholly misconceived and unmeritorious.

(1)	This Tribunal had at all times at the hearing of the Leave Application remembered the stage this application had progressed to, including the fact that no milestone date had been fixed.
(2)	But any proposed expert evidence must first comply with the three substantive conditions stated in paragraph [13] above before they are admissible.
(3)	Uncalled for and unhelpful expert evidence not meeting the above condition(s)  delays early resolution of parties’ dispute, wastes the precious time of the Court and causes the parties to incur substantial unnecessary costs.  Such delay and wastage is plainly, I think, not consistent with the underlying objectives of RHC: see paragraphs [16] and [18] above.  Moreover, such evidence confuses the real issues required to be resolved by the Lands Tribunal[9].
(4)	As such, real and substantial prejudice could and would, I think, be caused to the Applicant if the Leave Application was granted when it was uncalled for.  To allow expert evidence to be admitted in such case is a misuse of expert evidence[10].

F.   Ground of appeal re SJE

41.  Finally, the Respondents complained at paragraph 24 of their submissions and at paragraph 24 of the Draft Notice that this Tribunal had erred in deciding that a SJE be instructed by the parties (this ground of appeal, if a question of law at all, was also not raised by the Respondents in the 4^th Affirmation).

42.  Mr Chong and Ms Li submitted that: -

(1)	Where the expert issues are likely to be highly contentious, appointment of a SJE would be inappropriate.  Any dissatisfied party may seek separate expert evidence afterwards and the appointment of a SJE does not preclude subsequent appointment of a separate expert and the reception of further expert evidence: Hong Kong Civil Procedure, 2022 Edition, Volume 1, paragraph 38/4A/2;
(2)	Issues (2), (4)  and (5)  of the Leave Application would be highly contentious and pointing directly to the bone of contention between the parties in this application in relation to parties’ rights and extent of rights over the Disputed Areas; and
(3)	This Tribunal ought therefore, they argued, to have exercised its discretion to direct that expert evidence to be given on issues (2), (4)  and/or (5)  be given by separate experts of the parties instead of SJE jointly instructed by them.

43.  I do not find the above ground of appeal (and submissions)  having any prospect of success either.

(1)	In the Order, this Tribunal has only ordered SJE for reformulated issue (1)  and never so ordered in respect of issues (2), (4)  or (5)  as complained of by the Respondents.
(2)	At the hearing of the Leave Application, Ms Li had already cited paragraph 38/4A/2 of Volume 1, Hong Kong Civil Procedure, 2022 Edition, to this Tribunal and confirmed that issue (1)  is relatively less controversial than issues (2), (4)  and (5)[11].
(3)	Among other relevant factors, this Tribunal had already taken into account the possibility of further separate expert evidence on top of evidence given by SJE before ordering SJE on this relatively less contentious reformulated issue (1).
(4)	Issue (1)  concerns, one must point out, one out of the many Applicant’s complaints of breaches of the DMC and BMO on the part of the Respondents, namely that of s.34I(2)  of BMO.
(5)	At the end of the day, the chances are, I think, rather remote for there to be further dispute (or to have further expert evidence)  after the SJE has carried out the straightforward and simple job of identifying each equipment installed inside the 1/F electrical room and explaining the function of each of them.
(6)	Consistent with underlying objectives of RHC, there needs to be an element of proportionality with less controversial issue like issue (1), whose preparation should not, one thinks, drag down progress of the main battles between the parties. Appointment of SJE here does save time and expenses and benefits the parties, as well as makes economical use of the limited resources of the court.

H.  Conclusion

44.  I therefore conclude that none of the grounds of appeal raised by the Respondents enjoy any reasonable prospect of success on appeal. There is also no reason in the interests of justice why their intended appeal should be heard.

I.  Disposition

45.  Accordingly, I dismiss the Leave to Appeal Application brought by the 4 Respondents.

J.   Costs

46.  I make an order nisi that the 1^st to 4^th Respondents do forthwith pay the Applicant on District Court scale the costs of the Leave to Appeal Application together with counsel certificate, to be summarily assessed by this Tribunal on paper without hearing.  The Applicant do lodge and serve on the 4 Respondents its statement of costs for summary assessment within 7 days after this order becomes absolute and the 4 Respondents be at liberty to lodge and serve their written grounds of objections within 7 days thereafter.