TO KAN CHI AND OTHERS v. PUI MAN YAU AND OTHERS

CACV 47/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 47 OF 1999

(ON APPEAL FROM HCMP NOS. 562 OF 1992 & 2084 OF 1994)

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(Consolidated by the Order of the Honourable
Mr. Justice J. Chan dated 26 January 1996)

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R U L I N G

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Leong, J.A. (giving the ruling of the Court):

1. On 26th November 1998, Yam, J. gave judgment against the appellant Pui Man-yau declaring inter alia, that the respondents are the owners of the Tsing Wan Kun and the properties registered in its name and that the appellant was not the beneficial owner of Tsing Wan Kun and not the manager of Tsing Shan Monastery and Tsing Wan Kun and therefore not entitled to be registered as such under s.15 of the New Territories Ordinance. The appellant's counterclaim that he was the owner of the properties and was the manager of these two institutions was also dismissed. The appellant has filed an appeal against that judgment.

2. In this application, the respondents apply for security for costs of the appellant's appeal. The basis of the respondents' application is that the appellant is impecunious and if he is unsuccessful in his appeal, the respondents would not be in a position to recover the costs incurred in the appeal and there is little merit in the appellant's appeal. The security sought is for costs likely to be in the region of $1.8 million. The application was first heard in this court on 30th June 1999 but had been adjourned twice till today for the respondents to put in further evidence regarding the financial position of the appellant and the appellant to file an affidavit in reply. Since then further affidavits have been filed by the respondents but no affidavit in reply from the appellant has been received by this court. In essence, the new evidence reveals no better information about the appellant's assets than probably the appellant owns a mini-van.

3. The settled practice in an application of this nature is to require security for costs to be given by an appellant who would be unable through impecuniosity to pay the costs of the appeal if unsuccessful, without proof of other special circumstances. However, this court has a discretion and one important factor to be taken into account is the merits of the appeal. If the appellant should contend that he is unable to furnish security and that would effectively deprive him of the right to appeal, the burden of such contention is on him and he must show further that he would not be able to raise the security otherwise required elsewhere.

4. The appellant is a monk and the abbot of Tsing Wan Kun and he had admitted on 30th June 1999 that he was impecunious. He was legally represented at the early stage of these proceedings but he later acted in person. He had applied for legal aid but his applications were refused. He had applied to the Court of First Instance for release to him of funds paid into court in connection with these proceedings in order that he could have the necessary funds for legal representation but these applications were refused. He is no doubt unable to raise money through his own assets or elsewhere to pay for the costs of the appeal if he is unsuccessful.

5. The appellant resists this application on the ground that he as a monk will not be able to raise the money sought in any case but that should not be a reason to deprive him of his right of access to the Court of Appeal in respect of his case since he has good grounds of appeal.

6. His grounds are that because the Judge did not release funds to him, he was unable to have legal representation and was thus prejudiced in his defence, particularly, he was unable to have advice as to whether or not counter notices should be served to challenge the admissibility of relevant documents which otherwise would be inadmissible. His further grounds are that his claim of ownership to the Tsing Wan Kun properties through Tat On and Mung Sang tracing back to Chan Chun Ting to whom the property had been transferred by virtue of the instrument of Sung Tip which is a document evidencing the respondents giving Chan Chun Ting a life interest in the property cannot be denied. The Judge's view that the Sung Tip did not operate as any transfer of property is wrong. His claim is also supported by the Ross Ruling and the ruling has decided that the property of the monastery should be that of Chan Chun Ting. The Judge had no basis to find that the ruling was not a genuine one.

7. Mr. Chan, S.C. for the respondents contends that these grounds are unarguable because the first two grounds as to release of funds and the counter notices are procedural grounds. Even if the appellant is successful in showing that he should be given the opportunity to serve counter notices, these notices would serve no useful purpose because they relate to documents the maker of which had long since died. In any case the documents would have been admitted in evidence and there could not be prejudice to the appellant in any event.

8. As far as the money which has been tied up in the court is concerned, that is the proceeds of the sale of the land. The ownership of this money has yet to be decided which decision depends on the ownership of the two properties. It was right for the Judge not to allow the money to be released to the appellant for the purpose of his legal representation.

9. Regarding the other two points of Sung Tip and in the Ross Ruling, Mr. Chan says that the contention of the appellant was that Chan Chun-ting purchased the properties before the British took over. There was no such evidence. If it were the case, the properties would have been registered but there was no such registration. The instrument of Sung Tip whether on the face of it literally or construing it in the circumstances, did not operate to effect any transfer of land.

10. On the Ross ruling, it is submitted that the Judge was right to conclude that there was no proof that it was a genuine instrument because there was no record whatsoever of it in the Land Office. In any case, Chan Chun Ting even if he was a person practising Taoism and was a Taoist, he was not a member of the psyudo family of Taoists which, if it were the case, was practising Taoism in the monastery before 1914. The appellant is also unable to show that he is entitled to succeed to the properties through Tat On, Mung Sang and Chan Chun Ting.

11. I agree that the grounds of appeal although arguable do not appear to be good and substantial grounds because even if the Judge's interpretation of the two instruments, Sung Tip and Ross Ruling is incorrect, these do not on the evidence, have the effect of transferring any interest in land. In these circumstances, it is a case that this court should make an order that security for the costs of the appeal should be provided by the appellant. The question is what amount. Mr. Chan says that it is open to this court to decide what amount and the request for $1.8 million is an estimate of the solicitors. Any amount I am going to fix should not be too onerous. With the amount set down in the ordinance related to an appeal to the CFA in mind, i.e. $400,000, I fix an amount of $300,000. The security may be provided by way of a bank guarantee or cash.

12. In respect of time, the appellant shall provide security for costs in the sum of $300,000 by way of cash or bank guarantee on or before 7th October 1999. In the meantime the appellant's appeal shall be stayed until such security is provided. Failing compliance with this order, the appeal shall stand dismissed. Costs of this application shall be costs in the appeal.