CHU SYMON HIN WING as the surviving manager of CHU NAM YUN (OR YUEN) suing on behalf of all members of CHU NAM YUN (OR YUEN) v. LAU KWAI YING, the personal representative of the estate of WONG KAM FAI, deceased AND OTHERS

DCMP 3069/2019

[2025] HKDC 842

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 3069 OF 2019

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(By Originating Summons filed on 10^th September 2019 and Order to
carry on proceedings made by Master Jo Siu dated 11^th July 2023)

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DECISION

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A.  Introduction

1.  These proceedings concern the Plaintiff’s recovery of certain premises in the New Territories from squatters who have been occupying the premises.

2.  By Summons dated 12 October 2022 (“the Summons”), the Plaintiff seeks:

(a)  Summary judgment against the 3^rd Defendant, Wong Yam Foon (黃蔭歡), and the 4^th Defendant, Cheung Tung Wo (張東和), in the following terms:

(i)  The 3^rd and 4^th Defendants shall deliver to the Plaintiff vacant possession of the ALL THAT piece or parcel of ground situate lying and being at Tai Po, New Territories and registered in the Land Registry as Lot No 1071 in Demarcation District No 11 together with the messuages, erections and buildings thereon or some part thereon (if any) (“the Premises”);

(ii)  The 3^rd and 4^th Defendants shall be restrained from trespassing onto the Premises and/or entering into the same without the prior consent and knowledge of the Plaintiff;

(iii)  The 3^rd and 4^th Defendants shall demolish all the structures built by them or built under their order or permission on the Premises or any portion thereof (including but not limited to the 7 structures erected on the Premises without the District Officer’s approval as identified in yellow in the Site Plan in Annex 2 to the Summons) (“the Structures”) at their own costs within 42 days, failing which the Plaintiff shall be at liberty to demolish all the said structures at the costs of the 3^rd and 4^th Defendants;

(iv)  Interlocutory judgment be entered be entered against the 3^rd and 4^th Defendants for damages for trespass or mesne profits in respect of the use and/or occupation of the Premises to be assessed.

(b)  The 3^rd and 4^th Defendants’ counterclaim be struck out on the grounds that it discloses no reasonable cause of action and/or is frivolous or vexatious.

See §§2-3 of the Summons; (“the Application”)

B. Procedural History

3.  The relevant procedural history of the proceedings can be summarised as follows.

B1. Symon Chu becomes the only surviving manger of the Tong

4.  On 10 September 2019[1], these proceedings were commenced by Chu Symon Hin Wing (“Symon Chu”), Chu Yum Ko Daniel (朱蔭高) (“Daniel Chu”) and Chu Yum Hong (朱蔭康) (“YH Chu”), as managers of Chu Nam Yun (or Yuen) (朱南園) (“the Tong”) suing on behalf of all members of the Tong as the Plaintiff, by Originating Summons pursuant to Order 113 of the Rules of the District Court (Cap 336H).

5.  On 24 October 2019, the proceedings were ordered to be continued as if begun by Writ pursuant to the Order of Master S H Lee.

6.  On 16 August 2021, the 3^rd and 4^th Defendants were joined as Defendants to the proceedings pursuant to the Order of Master W Y Ho.

7.  By a carry on order dated 19 July 2022, Master Michelle Soong ordered that the proceedings be carried on by Symon Chu and YH Chu as the surviving managers of the Tong suing on behalf of all members of the Tong as the Plaintiff.

8.  By another carry on order dated 11 July 2023, Master Jo Siu ordered the proceedings be carried on by Symon Chu as the only surviving manager of the Tong suing on behalf of all members of the Tong as the Plaintiff.

B2. Settlement between the Plaintiff and the 1^st Defendant

9.  Upon the joint application of the Plaintiff and the 1^st Defendant (Lau Kwai Ying, the Personal Representative of the Estate of Wong Kam Fai (黃錦輝)) by Consent Summons filed on 13 October 2022, a Consent Order was made by Registrar Lui whereby it was ordered, inter alia, that:

(a)  The Plaintiff do recover possession of the portion of the premises as stated in §1 of the Consent Order;

(b)  Leave for the 1^st Defendant to withdraw her Re-Amended Defence and Counterclaim.

C. The Parties’ Case

10.  The respective cases of the Plaintiff and the 3^rd and 4^th Defendants can be summarised as follows.

C1. The Plaintiff’s Case

11.  The Tong is and was at all material times a Chinese customary hereditary t’ong (堂) recognised or registered under Section 15 of the New Territories Ordinance (Cap 97) and the Premises has been held by the managers (司理) of the Tong on trust for the benefit of the members of the Tong.

12.  Since the Premises was acquired on behalf of the Tong’s members in around 1935, there has been new members joining the Tong. The youngest member of the Tong is Macallan John Staggard Chu, who was born on 1 December 2008.

13.  Since an unknown date and for an unknown period, inter alia, the 3^rd and/or the 4^th Defendant have and are currently occupying/using the Premises without the consent of the Plaintiff.

14.  On unknown dates, inter alia, the 3^rd and/or the 4^th Defendant erected the Structures on the Premises without the consent of the Plaintiff.

15.  On 22 March 2019, the Plaintiff received a warning letter from the District Lands Officer, Tai Po, requiring the Plaintiff to demolish the Structures before 23 April 2019. The above warning letter has been registered at the Land Registry by the District Lands Officer against the Premises by Memorial No: 19061100890020 on 11 June 2019.

16.  Notwithstanding the Plaintiff’s repeated requests, the 3^rd and 4^th Defendants has failed to deliver vacant possession of the Premises to the Plaintiff or remove the Structures. Hence, the Plaintiff has to commence these proceedings.

C2. The 3^rd and 4^th Defendants’ Case

17.  The 3^rd and 4^th Defendants put forward different defences against the Plaintiff’s claim at different stages.

Re-Amended Defence and Counterclaim

18.  In the Re-Amended Defence and Counterclaim (“D&CC”), the 3^rd and 4^th Defendants alleged as follows.

19.  The 3^rd and 4^th Defendants put the Plaintiff to proof as to the Tong’s members and their dates of birth and expiry of the limitation period for bringing the present claim.

20.  The 3^rd and 4^th Defendants admit that they have been using and occupying the Premises without the Plaintiff’s consent, and that they have erected the Structures without the Plaintiff’s consent.

21.  The 3^rd and 4^th Defendants claim that they have been using/occupying the Premises exclusively and continuously with the intention of using and occupying the same as their own since about 1995. The 3^rd and 4^th Defendants allege that:

(a)  In about 1995, Mr Wong Kam Fai (黃錦輝) (“Mr Wong”) decided to occupy the Premises as his own. However, as Mr Wong was short of funds at that time, he invited the 3^rd and 4^th Defendants to jointly occupy the Premises as their own with the intention of developing their businesses on the Premises;

(b)  Thereafter, in the same year, Mr Wong and the 3^rd and 4^th Defendants engaged contractors to carry out various works on the Premises for a total cost of HK$300,000 which was paid by the above parties in equal share. The works included building a metal fence to surround the Premises to prevent anyone from entering into the Premises;

(c)  Since then, Mr Wong, the 3^rd and the 4^th Defendants expanded their businesses by storing more containers on the Premises and leasing them to their clients for various purposes. As for the 3^rd Defendant, he has been operating a garage shop on the Premises since around 1995;

(d)  In about 2013, Mr Wong, the 3^rd and the 4^th Defendants found out that the Government Rate and Rent for the Premises had remained unpaid since 2006 (“the Outstanding Rates”). They settled the Outstanding Rates and they have been settling all the subsequent outstanding rates since 2013.

(e)  Accordingly, the 3^rd and 4^th Defendants have been occupying, possessing, squatting and using the Premises exclusively and continuously through themselves or their tenants for a period of not less than 24 years or 12 years to the exclusion of the world at large, including the Plaintiff since about 1995. Alternatively, the above occupation, possession, squatting and using of the Premises by the 3^rd and 4^th Defendants has taken place without the consent or licence of the Plaintiff since 1995.

22.  Relying on Sections 7 (2), 8 (1) and 17 of the Limitation Ordinance (Cap 347) (“the LO”), the 3^rd and 4^th Defendants allege that the title of the Plaintiff to the Premises has been extinguished as against them in about 2007, and the Plaintiff is no longer entitled to bring any action to recover possession of the Premises.

23.  On the above basis, the 3^rd and 4^th Defendants deny the Plaintiff’s claim and counterclaim for declarations to the effect that have acquired possessory title to the Premises by way of adverse possession.

Affirmations of the 3^rd and 4^th Defendants

24.  The 3^rd Defendant filed his 1^st Supplemental Affirmation dated 21 April 2023 in opposition to the Application (“Wong Supp”). The 4^th Defendant filed his 1^st Supplemental Affirmation of the same date (“Cheung Supp”), adopting the content of Wong 1^st to oppose the Application.

25.  In Wong Supp, the 3^rd Defendant contended that:

(a)  He and the 4^th Defendant have no knowledge of the family history of the Chu family and puts the Plaintiff to proof;

(b)  In or about the middle of 2013, some officers from the Rating and Valuation Department visited the Premises and posted a notice demanding the outstanding rates and government rent of the Premises for 7 years and warning to exercise the right of resumption in accordance with the Lands Resumption Ordinance (Cap 124);

(c)  Upon discussion with the staff of the Department, the 1^st, 3^rd and 4^th Defendants settled the Outstanding Rates and agreed for the 1^st Defendant to be registered as the payment of the rates and government rent of the Premises. In this regard, demand notes of rates and rent of the Premises issued to the 1^st Defendant for the period between 1 April 2006 and 30 September 2019 were exhibited. Had it not been the 1^st, 3^rd and 4^th Defendants’ settlement of the Outstanding Rates in 2013, the Plaintiff’s title would have extinguished;

(d)  In the alternative, the 3^rd and the 4^th Defendants “to certain extent should gained (sic) beneficiary interest of the Premises because [they] had preserved the status of the Premises”.

Skeleton Submissions of the 3^rd and 4^th Defendants

26.  In the 3^rd and 4^th Defendants’ Skeleton Submissions dated 19 February 2025 for the hearing of the Application (“the Skeleton”), the 3^rd and 4^th Defendants made no mention at all of the defences raised in the D&CC, Wong Supp or Cheung Supp. Rather, the 3^rd and 4^th Defendants put forward the following new arguments to oppose the Application.

27.  First, the 3^rd and 4^th Defendants contended that unanimous consent from all the managers of the Tong is required for the present proceedings to be commenced and pursued of the 3 registered managers of the Tong, while Symon Chu and YH Chu’s consent can be inferred from their affirmations filed in these proceedings, there is no document indicating Daniel Chu’s consent to the proceedings.

28.  Second, the 3^rd and 4^th Defendants said that the Plaintiff’s Re-re-Amended Statement of Claim and Re-amended Reply are defective, as the statements of truth therein were signed by the Plaintiff’s solicitor, rather than a manager of the Tong.

D. Applicable Legal Principles

D1. Summary Judgment and Striking Out

29.  The legal principles concerning summary judgment application has been summarised by Ng J in Guanghua SS Holdings Limited v Lim Yew Cheng [2022] HKCFI 1052 at §13:

(a)  If the plaintiff’s application is properly constituted, it is prima facie entitled to judgment unless the defendant shows cause to the contrary;

(b)  The mere assertion in an affidavit of a given situation by the defendant responding to an application for summary judgment does not, ipso facto, ground leave to defend;

(c)  The burden is on the defendant to show a real or bona fide defence or some other reason for a trial. The defendant must satisfy the Court that his evidence is capable of being believed and that on the basis of such evidence, there is a fair or reasonable probability of the defendant having a real or bona fide defence.

30.  In respect of striking out, Order 18 rules 19(1)-(2) of the RDC provides that:

“(1) The Court may, either of its own motion or on application, at any stage of the proceedings order to be struck out or amended any pleading or the indorsement of any writ in the action, or anything in any pleading or in the indorsement, on the ground that:-

(a) it discloses no reasonable cause of action or defence, as the case may be; or

(b) it is scandalous, frivolous or vexatious; or

(c) it may prejudice, embarrass or delay the fair trial of the action; or

(d) it is otherwise an abuse of the process of the Court,
and may order the action to be stayed or dismissed or judgment to be entered accordingly, as the case may be.

(2) No evidence shall be admissible on an application under paragraph (1)(a).”

D2. Recovery of Land by T’ong and Adverse Possession

31.  The nature of a beneficiary’s interest in a Chinese customary t’so/t’ong and how limitation period for recovery of the t’so/t’ong property should be calculated were considered by Deputy Judge Lam (as Lam PJ then was) in Leung Kuen Fai v Tang Kwong Yu (or U) T’ong or Tang Kwong Yu Tso [2002] 2 HKLRD 705 §§1, 24 and 44-45:

(a)  In respect of land in the New Territories within the scope of Section 13 of the New Territories Ordinance, a t’so/t’ong is recognised as a form of Chinese customary landholding;

(b)  It has been established in Hong Kong that the concept of trust is applicable to a t’so/t’ong with the managers as trustees and the members as beneficiaries. It is to be noted that this is an application of concepts of English law to a Chinese customary institution. However, by reason of the local circumstances, certain concepts in English trust law were held to be inapplicable, e.g. the rule as to perpetuity;

(c)  In practice, with unanimous consent of all the members, the t’so/t’ong property could be sold, partitioned or distributed, and the members could also decide on the use of the surplus income generated from t’so/t’ong property;

(d)  In the absence of a sale or partition or distribution, each member only has a life interest in the t’so/t’ong property. The interest of a member arose automatically by birth. Likewise, it extinguished automatically upon death of the member. Since the interest would not form part of the estate of a deceased member, there is no question of succession. The extent of the life interest at any point in time depends on the number of living members in the t’so/t’ong;

(e)  The interests of the members have to be considered independently from the rights of the managers. Further, even amongst members of the t’so/t’ong, limitation periods could be different for different members since one does not claim through another;

(f)  Whenever a new member is born, a new equitable interest in the t’so/t’ong property is created. A new limitation under Sections 7 (2) and 22 of the LO would start to run. The new limitation period would not expire until 6 years after the member ceases to be an infant;

(g)  By reason of Section 10 (2) of the LO, the title of the trustees would not extinguish so long as there is at least one beneficial owner whose right to recover the land is not barred.

32.  In Tsang Kwong Kuen v Hau Wai Keung Gaius [2014] 5 HKLRD 622 at §5, Lam VP (as Lam PJ then was) cited the principles in Leung Kuen Fai v Tang Kwong Yu Tong [2002] 2 HKLRD 705 and explained further the characteristic of a hereditary t’so/t’ong and adverse possession claims against premises held by it:

“We shall first deal with the Leung Kuen Fai aspect as it is a short point and there is no dispute that the appeal must fail if Mr Shum cannot overcome it. The essence of the relevant principle is that due to the peculiar characteristic of a t’so/t’ong (preserved by Chinese customary law and Section 13 of the New Territories Ordinance (Cap. 97) with a new equitable interest stemming from each new member being admitted upon birth by reason of his hereditary link with focal ancestor, a person who is in adverse possession cannot extinguish the title of the t’so or t’ong under the Limitation Ordinance (Cap. 347) unless he can establish the requisite limitation period against all the living members of the t’so or t’ong.” (Emphasis added)

See also: Tang Man Kit & Foo Tak Ching the Managers of the “Wah Yan Mo Fan Heung (華人模範鄉)” v Chong Kee Ting Vicwood alias Chong Kam Hing trading as Victory Plywood Door Manufacturing Company HCA 1222/2010 (unrep, 14/7/2011) at §§15-18, 28; Tang Koon Lin (鄧觀連）,Tang Koon Yung (鄧觀容）,Tang Ah Fai（鄧亞輝） and Tang Luen（鄧聯鋒） as Managers of Tang Kwok Ying Tso（鄧國英祖）v Person(s) in occupation of the premises & Anor DCMP 745/2014 (unrep, 26/8/2014) per DDJ Jackson Poon at §21.

E. Analysis

33.  For the reasons set out below, I am of the view that summary judgment should be granted in favour of the Plaintiff, as the 3^rd and 4^th Defendants have failed to show any real or bona fide defence against the Plaintiff’s claim.

E1. Defence based on Adverse Possession

34.  There is no dispute that the Tong is a t’ong registered under Section 15 of the New Territories Ordinance (Cap 97)[2]. There is also no dispute that the 3^rd and 4^th Defendants have been using/occupying the Premises without the Plaintiff’s consent and have erected the Structures on the Premises without the Plaintiff’s consent[3].

35.  As shown in the Land Register and the Memorial of Sale (No: TP 91869) of the Premises, since 1935, the Tong has been the registered owner of the Premises. In HCA 162/1963, Symon Chu’s great-grandfather, Mr Chu Tak Hing (朱德馨) (“Chu Senior”), claimed that the Tong was an alias of him and that he was the beneficial owner and solely entitled to various properties, including the Premises held in the name of the Tong. By the Judgment of Scholas J dated 29 May 1968, the Court rejected Chu Senior’s claim and found that Chu Senior in fact intended to create family t’ongs in the name of, inter alia, the Tong according to Chinese custom in the New Territories and that he perfected the said intention by having the relevant properties conveyed to the relevant t’ong names with a manager(s) and trustee(s).

36.  Since the Premises was held in the name of the Tong in 1935, there have been new members joining the Tong, including Symon Chu’s son, Macallan John Staggard Chu (“Macallan Chu”), who was born on 1 December 2008. The date of birth of Macallan Chu, and the fact that he is a male living descendant through Symon Chu, Mr Chu Cheong Wai (朱昌維) (father of Symon Chu) and Mr Chu Yam Wa (朱蔭華) (grandfather of Symon Chu and the eldest son of Chu Senior) are confirmed by the family tree submitted to the Tai Po District Office by Symon Chu, Daniel Chu and YH Chu in 2015 and the birth certificate of Macallan Chu.

37.  According to Sections 7 (2) and 22 of the LO, the limitation period for Macallan Chu to recover the Premises will only expire by 30 November 2032 (ie 6 years after Macallan Chu reaches 18 years’ old).

38.  As shown in the Approval of Appointment of Manager, with effect from 5 September 2018, Symon Chu, Daniel Chu and YH Chu have been the managers of the Tong. As confirmed by the carry on orders mentioned in §§7-8 above, Daniel Chu and YH Chu have passed away since the commencement of these proceedings and Symon Chu is currently the only remaining surviving manager of the Tong.

39.  Applying the legal principles set out in Section D2 above, the limitation period for Macallan Chu as a member of the Tong to recover possession of the Premises has not expired at the time when these proceedings were commenced. Therefore, even if the 3^rd and 4^th Defendants were in adverse possession of the Premises, they cannot extinguish the title of the Tong under the LO. It follows that their adverse possession claim must fail.

E2. The Other Defences

40.  In Wong Supp §§9-10, the 3^rd and 4^th Defendants raised two further defences which were not pleaded in the D&CC. None of them amount to any real or bona fide defence against the Plaintiff’s claim.

41.  In Wong Supp §9, the 3^rd and 4^th Defendants said that had it not been the 1^st Defendant and their settlement of the Outstanding Rates in 2013, the Plaintiff’s title to the Premises would have been extinguished, presumably due to the Government’s possible exercise of right of re-entry due non-payment of the Outstanding Rates. However, whether the Government would have exercised such a right back then was a matter between the Government and the Tong/the Plaintiff, it does not have anything to do with the Plaintiff’s rights against the 3^rd and 4^th Defendants.

42.  As to the allegation in Wong Supp §10 that by reason of the 1^st, 3^rd and 4^th Defendants’ payment of the Outstanding Rates, the 3^rd and 4^th Defendant “to certain extent should gained (sic) beneficiary interest of the Premises because [they] had preserved the status of the Premises”. The 3^rd and 4^th Defendants have failed to cite any legal authorities to support this contention. It is difficult to see how the mere payment of Outstanding Rates, without more, would give rise to beneficiary interest in the Premises in favour of the 3^rd and 4^th Defendants.

43.  In the Skeleton, the 3^rd and 4^th Defendants raised 2 further arguments against the Application. Leaving aside the fact that these further arguments were not pleaded and they were not included in any of the affirmations filed by the 3^rd and 4^th Defendants, they lack merits and do not amount to any real or bona fide defence against the Plaintiff’s claim.

44.  I do not agree with the 3^rd and 4^th Defendants’ complaint that there was no evidence showing that Daniel had consented to the commencement of these proceedings, or that whether Daniel Chu has really passed away was in doubt:

(a)  In the Affirmation of YH Chu dated 29 August 2019 in support of the Originating Summons, §1, YH Chu made clear on oath that he was authorised by Daniel Chu and Symon Chu to make the affirmation. The 3^rd and 4^th Defendants failed to put forward any evidence to challenge this confirmation;

(b)  There is no room for any doubt that Daniel Chu might not have passed away:

(i)  After considering the Plaintiff’s application, by the carry on order dated 19 July 2022, the Court allowed Symon Chu and YH Chu to carry on with the present proceedings as the remaining surviving managers of the Tong, showing that Daniel Chu have passed away by that time;

(ii)  In the 1^st Affirmation of Symon Chu dated 9 March 2023, §1, Symon Chu confirmed on oath that he and YH Chu were the surviving managers of the Tong. In the 2^nd Affirmation of Symon Chu dated 20 October 2023, §1, Symon Chu stated on oath that by that time, he became the only surviving manager of the Tong.

45.  The 3^rd and 4^th Defendants’ complaint that the Plaintiff’s pleadings were defective as they only contain Statements of Truth signed by the Plaintiff’s handling solicitor has no merits either.

46.  The Plaintiff in the present proceedings are the manager(s) of the Plaintiff. Order 41A Rule 3 (2) RDC does not apply as the managers are not an incorporated or unincorporated body of persons provided in the above provision. Rather, as provided in Order 41A Rule 3 (1) (b) (ii) and O 41A Rule 4 (3) RDC, the Statements of Truth of the Plaintiff’s pleadings can be signed by the Plaintiff’s solicitor.

47.  Even if I were wrong and Order 41A Rule 3 (2) does apply, I am prepared to exercise my discretion under Order 41 Rule 2 (3) to dispense with the Statements of Truth in the Plaintiff’s pleadings. The Plaintiff’s case has already been confirmed on oath by the affirmations filed by Symon Chu and YH Chu. In such circumstances, and insofar as it may be necessary, it would be just for me to dispense with the need of another Statement of Truth to be appended on the Plaintiff’s pleadings.

E3. Striking Out of the Counterclaim

48.  For the reasons stated above, even if I assume all the matters pleaded in the D&CC to be true, and taking all the matters stated in Wong Supp and Cheung Supp to the highest, as a matter of law, the 3^rd and 4^th Defendants’ adverse possession must fail. I will therefore strike out the 3^rd and 4^th Defendants’ counterclaim.

F. Disposition and Costs Order Nisi

49.  I will grant summary judgment to the Plaintiff in terms of §§2 and 3 of the Summons.

50.  I will also order the 3^rd and 4^th Defendants’ Counterclaim be struck out.

51.  As for costs, I will grant a Costs Order Nisi that the 3^rd and 4^th Defendants shall pay to the Plaintiff the costs of these proceedings (including any costs reserved) to be paid by the 3^rd and 4^th Defendants to the Plaintiff, with Certificate for Counsel for the substantive hearing of the Summons on 24 February 2025. Such costs to be taxed if not agreed.

52.  Unless there is an application made by summons for the variation of the above costs orders nisi within 14 days after the handing down of this Decision, the said costs order Nisi shall become absolute.