WAH SING PROPERTY MANAGEMENT LIMITED v. SIU WAI YIN AND OTHERS

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Headnote

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Proceedings by manager of building to restrain owner/occupier of ground floor shop from breaching Deed of Mutual Covenant by placing items on common part constituted by covered pavement running along frontage of shop.

                Dispute as to whether the word 'place' in the covenants took a meaning more restricted than its literal meaning, and, if so, whether such restriction should be reflected in the Order.

                Held:

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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JUDGMENT

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1. These proceedings have already been disposed of as between the Plaintiff and the 2nd and 3rd Defendants.

2. Subject to one point of difference between them, the Plaintiff and the 1st Defendant are agreed on the Order to be made, granting injunctive relief or embodying undertakings in the same terms. They have agreed the facts on which I am to proceed in determining the one point on which they differ. The statement embodying these agreed facts reads as follows:-

3. Miss Yuen, for the Plaintiff, handed up draft minutes of order against the 1st Defendant, providing that:-

4. It is in respect of item (a)of para. (3) of this draft that the parties before me differ. I will refer to this item as 'the disputed item'.

5. In support of the disputed item, Miss Yuen relies on para. 11 of the Deed of Mutual Covenant, which contain, inter alia, covenants:-

6. Mr Mok, for the 1st Defendant, took a number of points in the course of an able submission, which runs, as I understand it, along these lines: The word 'place' is not free from ambiguity as it appears in the Deed of Mutual Covenant. Naturally, it covers, and is intended to cover, storing or displaying furniture on the covered pavement which forms part of the common parts of the building. But, if read literally, it would cover conduct which cannot, on the true construction of the Deed, be regarded as prohibited, eg. the act of a delivery worker putting down an item of furniture to adjust his grip on it. In the course of taking furniture in and out of its shop, the 1st Defendant's servants or agents are bound, from time to time, to place an item of furniture or two down on the covered pavement momentarily. This might be done to adjust a grip, or to pause while somebody gets out of the way, or to regain balance, and so on. It cannot be intended that this sort of thing is prohibited. For, indeed, if it was so intended, the covenant or covenants embodying such intention would be oppressive, and thus undeserving of enforcement by the grant of a discretionary remedy: see Talbot v. Ford (1842) 13 Sim 173. As an alternative to construing the word 'place' so as to avoid a literal construction resulting in oppression, an implied term should, of necessity, be read into the Deed of Mutual Covenant to permit the momentary placing of furniture on the covered pavement in the course of deliveries to and from the shop.

7. Miss Yuen, in an equally able submission, developed her client's concern that if the word 'place' was in any way qualified in the Order that would open the way for the 1st Defendant to abuse the qualification by, for example, piling furniture on the covered pavement in the name of delivery. It is Miss Yuen's position, as I understand it, that the sort of thing that Mr Mok's client says it wants to do is not strongly objected to even if, strictly speaking, a breach of the Deed of Mutual Covenant. Her real objection to the sort of wording Mr Mok proposes is the risk of abuse to which it gives rise. Therefore, she submitted, the word 'place' should be used without qualification in the Order to be made - just as it is used without qualification in the covenants relied upon by her client.

8. As to this last point, it is necessary to bear in mind well-established principles which guide a court granting an injunction to as precise an expression of its order as the circumstances reasonably admit. Here, Mr Mok has drawn my attention to the statement in 'Spry: The Principles of Equitable Remedies', 3rd ed. at pp. 357-358 that:

'These principles will sometimes be found to apply even where the injunction that is sought is directed to the enforcement of contractual rights that are themselves phrased in general or ambiguous terms. '

9. This must, in my judgment, be right. In Parker v. First Avenue Hotel Co. (1883) 24 Ch. D. 282 at p.286, Lord Justice Cotton, with whose judgment the Master of the Rolls and Lord Justice Bowen concurred, said:-

10. In my judgment, the covenants relied upon do not, on their true construction, prohibit such momentary placing on the covered pavement of furniture as cannot be avoided by the exercise of reasonable diligence in the planning and supervision of deliveries to and from the 1st Defendant's shop. If the covenants on their own had to be construed so as to prohibit this, it would, in my judgment, be necessary to imply a term to permit the same. And if neither construction nor implication achieved this, we would, in my judgment, be left with covenants so oppressive as to be undeserving of enforcement by the grant of the discretionary remedy of injunctive relief.

11. In the present circumstances, I consider it appropriate to word the disputed item so as to spell it out that the 1st Defendant has the limited freedom which I have just described. But, at the same time, I propose to employ such wording as would, so far as practicable in the present circumstances, guard against the abuse which the Plaintiff fears. This I propose to do by adding the following words to the disputed item: `save in so far as the momentary placing of any item or items of furniture on the pavement cannot be avoided by the exercise of reasonable diligence in the planning and supervision of deliveries to and from the shops.' If the 1st Defendant prefers to give undertakings rather than be enjoined by injunctions, and if the Plaintiff is agreeable, so be it.

12. This will, I hope, be an end of the matter. But I am conscious that, as it is put in 'Spry' (supra) at p. 358,' ... it must be remembered that, should difficulties of compliance subsequently arise, further applications may be made to the court, so as to lead to a resolution of ambiguities and to the surmounting of difficulties of compliance or enforcement ...'. Accordingly, I think that both parties should be given liberty to apply.

[Argument as to costs]

13. I have now to deal with the question of costs. On November the 11th this year, the Plaintiff offered the 1st Defendant some comfort in the form of an assurance contained in a letter of that date. The relevant paragraph of the letter which is the final paragraph thereof reads:

The idea of such comfort being reflected in the Order was canvassed in correspondence. The Plaintiff's attitude was that such comfort should not be reflected in the Order; and negotiations in this regard appears to have been broken off by the Plaintiff's solicitor's letter of December the 2nd this year, the last paragraph of which reads:

14. Today, I have accepted the 1st Defendant's argument that the word 'place' requires, as a matter of construction, some limitation, and that such limitation should be reflected in the Order. On the face of it, this provides a basis for the argument that the 1st Defendant should have the costs after a certain date - there being no dispute that, subject to this, the Plaintiff is entitled to the costs of the action.

15. I have, however, to bear in mind that the 1st Defendant had been in substantial breach of covenant, and that it had denied such breach, and maintained such denial, for a considerable period of time.

16. In these circumstances, it behoved the 1st Defendant to work much harder to allay the natural fears and suspicions of the Plaintiff. But one comes back again to the fact that the Plaintiff had offered comfort, that the 1st Defendant had wished such comfort to be reflected in the Order, that the Plaintiff had refused, and that I have, in the Order which I made, placed some restriction on the word 'place'.

17. It is true that my formulation is more restricted than the Plaintiff's formulation. But the 1st Defendant cannot be blamed for proceeding on the basis of the formulation of the other side. The only question was whether it ought to go into the Order. The legal advisors of both parties have approached this matter in as reasonable a fashion as one can normally expect in the course of litigation.

18. Counsel on both sides, and I say this in all sincerity, have presented their cases with outstanding ability. Sometimes the excellence of the arguments makes the task easier; sometimes it makes it all the more difficult for being more finely balanced. Giving this matter the best consideration I can, I think the proper order as to costs as between the Plaintiff and the 1st Defendant is that the Plaintiff have the costs of the action up to the 1st of December this year, and that thereafter there be no order as to costs.