LOK SIU FEI v. THE ESTATE OF CHUNG WAN KUNG, DECEASED

DCMP 1056/2015

IN THE DSTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 1056 OF 2015

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REASONS FOR JUDGMENT

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1.  By this Originating Summons, the Plaintiff asks for certain declarations to the effect that he has been in adverse possession for over 20 years of a piece of land situated at Chai Kek Village (寨乪村), Tai Po, New Territories, Hong Kong and registered in the Land Registry as Lot No. 916 in Demarcation District No. 10 (“Lot 916”) of which the Defendant is the registered owner. The Defendant has been absent throughout the proceedings.

2.  After the hearing, this Court granted the following order:

i) A declaration against the Defendant that: -

a) the Defendant has lost the right to bring any action to recover Lot 916 or any part thereof by virtue of section 7(2) of the Limitation Ordinance (Cap. 347);

b) by virtue of section 17 of the Limitation Ordinance (Cap. 347), the title of the Defendant to Lot 916 or any part thereof has been extinguished in favour of the Plaintiff and the Plaintiff has acquired a possessory title and all the possessory right, title and interest including the right to exclusive physical possession and occupation of and in Lot 916;

c) the Plaintiff has been in adverse possession of the Lot 916 for a period of and/or exceeding 20 years prior to the commencement of these proceedings and has thereby acquired a possessory title and/or right to the Lot 916; and

ii) there be no order as to costs.

3.  This Court also indicated that brief reasons for judgment will be handed down. They are as follows.

Brief Background & Service of Legal Process

4.  The background below is gleaned from affirmations filed by the Plaintiff and Mr Chan Kin Wo, his solicitors. In their affirmations, they have exhibited quite a number of documents registered with the Land Registry, which this Court considers, are uncontroversial. Mr Chan has also set out the results of his investigation on the whereabouts of the Defendant and the Defendant’s family upon requisitions by the Official Solicitor.

5.  According to record of the Land Registry[1], the registered owner of Lot 916 is one Mr Chung Wan Kung (鍾雲恭), who is a lessee under the original Block Crown Lease. He must have already died by now (“Deceased”)[2].

6.  According to the Plaintiff, his father Mr. Lok Ching (駱清) alias Lok Wing Tak (駱榮德) (“the Plaintiff’s father”), entered into an agreement in Chinese dated 3 January 1957 with one Madam Wan Ah Fung (溫亞鳳) (“Madam Wan”) to purchase a piece of land at HK$400 (“Chinese Agreement”)[3]. Madam Wan was described in the Chinese Agreement as the aunt (嬸母) of one 鍾福傳 (transliteration: Chung Fook Chuen, and referred to as “FC”) and one 鍾福來 (transliteration: Chung Fook Loi, and referred to as “FL”). It was stated in the Chinese Agreement that the land belonged to person(s) known as 毓祥 (Yuk Siong[4], and referred to as “YS”) and/or雲高 (transliteration: Wan Ko, and referred to as “WK”) of the Chung’s family. Madam Lam would procure them to effect the transfer if and when they come back from abroad. Madam Wan stated that she, FC and FL were then in urgent need of money. She described herself as a daughter-in-law of the Chung’s family and signed in that capacity[5]. FC and FL were three of the witnesses to the Chinese Agreement in addition to the drafter, who was also a member of the Chung’s family.

7.  The land which was the subject matter of the Chinese Agreement was not properly identified except being stated as situated in Demarcation District No 10. It is the Plaintiff’s case that the land referred to in fact was Lot 916.

8.  However, up until the time of trial, Lot 916 remains registered in the name of the Deceased.

9.  The Plaintiff’s father was the owner of Lot 917 by a conveyance dated 1 March 1949 with memorial number 123133[6]. For reason that no one can explain, despite the presence of formal conveyance documents, the Plaintiff’s father had never appeared on the land register as the registered owner of Lot 917 at all, though some Government documents did show that he had once been the owner[7]. Lot 917 is at the north of Lot 916 and is adjacent to it.

10.  After the purchase of Lot 916 as aforesaid, the Plaintiff’s father built a house on it which straddled on a small part of Lot 917[8]. It was completed in 1958. The Plaintiff exhibited a photo of the house with “1958” clear marked on the top outer wall of the house (“the said House”)[9].  The Plaintiff was born in 1959 after the said House was built.

11.  It is the Plaintiff’s case that his family, including his father used the said House mainly as dwelling house and Lot 917 for farming since purchase of the 2 pieces of land. The farming activities that they had on the 2 lots included pig rearing, growing of fruit trees such as banana and papaya and vegetables. In order to prevent unauthorized entry and separating farmland from the living area, the family constructed concrete walls on which wire mesh was erected to fence off the said House and part of Lot 917. There was also a footpath leading to the entrance of the fenced off area where the said House stood. A metal gate was erected. It was kept locked by the Plaintiff and his family.

12.  The Plaintiff’s father passed away on 21 June 1986[10]. It is the Plaintiff’s evidence that he continued living there with his mother. He and his family continued to live at the said House and the 2 lots after he got married on 23 February 1987, and birth of his two sons, respectively in 1988 and 1994, until year 2000 when the Plaintiff’s family moved to the city. After moving out, the Plaintiff’s case is that the said iron gate and doors of the said House are locked by him to exclude trespassers. Farming tools were kept inside, and they have been making regular visits to the said House. It is the Plaintiff’s case that throughout the period from 1958 up until now it was he and his family who had all along paid the Government rent, modification of tenancy permits fee and all other utility charges such as water and electricity expenses. They incurred expenses to renovate and improve the said House throughout their occupation, treating the same as their own. It is also his evidence that no one from the Defendant had ever come to re-claim possession of Lot 916. He had exhibited photos showing he and his family at the said House as at 1971[11], his marriage, and his family after marriage all taken in the said House.

13.  It appears that the Plaintiff’s father had sold Lot 917 to one Lok Ping On alias Lok Ho Ping On (“Madam Ho”)[12] whom The Plaintiff is the nephew of Madam Ho. As evidenced by a statutory declaration dated 14 August 1995[13] made by Madam Ho, she became the registered owner of Lot 917 on 22 March 1972[14]. Somehow Lot 917 was carved out into two parts by Madam Ho, namely, Portion A (“Lot 917 SA”) and Remaining Portion (“Lot 917 RP”). However, no deed poll cannot be found. It was stated in Madam Ho’s declaration that by a Conveyance as Gift dated 22 June 1982 and registered with the Tai Po District Land Registry by memorial no. 209294[15], Lot 917 SA was conveyed to the Plaintiff by way of gift. This is the part on which part of the said House straddled and enclosed by the fence. By another Deed of Gift dated 20 October 1995, Madam Ho gifted over Lot 917 RP to the Plaintiff. Since then the Plaintiff has become the registered owner of the entire Lot 917.

14.  It is the Plaintiff’s evidence that despite the apparent discrepancy in the paper title of Lot 917[16], he and his family had been in occupation of Lot 916 (on which the said House was erected) and Lot 917 from the respective dates on which his father acquired them. 

15.  In the course of requesting the Official Solicitor to accept service on behalf of the estate of the Deceased, solicitors for the Plaintiff had made an extensive enquiry with the Probate Registry, Registrar of Births and Deaths, the village representative of Chai Kek Village, Heung Yee Kuk, etc. They later managed to find FC, one of the witnesses to the Chinese Agreement, and from whom the family tree of the Chung’s family starting from the Deceased as family head was eventually mapped out.

16.  The family tree drawn up by FC shows the following. The Deceased was also known as Chung Wan Ko (transliteration), i.e. the WK mentioned in the Chinese Agreement. The Deceased had 3 sons who had all passed away by now. YS, who was also mentioned in the Chinese Agreement, is one of the Deceased’s son. Madam Wan was married to one of them. Another son had 2 issues, namely FC and FL. FL had passed away leaving no issues. Madam Wan had passed away and left no or no traceable issues. It seemed that there is an issue from the male line of YS. However, he is currently in England but whereabouts unknown. FC is the only descendant of the Deceased traceable in Hong Kong. However, he refused to represent the estate. 

17.  The Official Solicitor thus consented to represent the estate limited only to the acceptance of service of the Originating Summons, and service was duly effected.

18.  Pursuant to an order for substituted service by Master D To dated 4 May 2017, leave was granted to the Plaintiff to serve the Notice of Appointment to hear the Originating Summons, Notice of Adjourned hearing and the supporting affirmation by inserting an advertisement once in a local Chinese newspaper, namely, the Sing Pao Daily News. It was done on 6 June 2017.

19.  This Court is therefore satisfied that the Plaintiff can proceed further with the Originating Summons. As the evidence is basically unchallenged, on a balance, this Court accepts the Plaintiff’s evidence in its entirety.

Legal Principles and Discussion

20.   It is not the normal practice of the court to make a declaration without a trial, although it is a rule of practice, not a rule of law. Where declaratory relief is sought, the court will scrutinize the application for default judgment carefully and does not hastily grant the relief sought: see paragraph 19/7/20 of Hong Kong Civil Procedure (Vol 1) 2017 and Patten v Burke Publishing Co Ltd [1991][17].

21.  Accordingly, this Court should thoroughly go through the evidence available in the present case in order to see whether a case on adverse possession on the part of the Plaintiff vis-à-vis the Defendant in respect of Lot 916 can be made out. 

22.  The laws on adverse possession are quite settled. I agree with Mr Au Lut Chi, counsel for the Plaintiff that the starting point is the Limitation Ordinance, Cap 347. The following provisions are relevant:

i)   Section 7(2)

“No action shall be brought by any person to recover any land after the expiration of 12 [20 years for cause of action accrued before 1 July 1991][18] years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person:

[proviso relates to the Government and is irrelevant to the    present case]”

ii)   Section 8(1)

“Where the person bringing an action to recover land, or some person through whom he claims, has been in possession thereof, and has while entitled thereto been dispossessed or discontinued his possession, the right of action shall be deemed to have accrued on the date of the dispossession or discontinuance.”

iii)   Section 13(1)

“No right of action to recover land shall be deemed to accrue unless the land is in the possession of some person in whose favour the period of limitation can run (hereafter in this section referred to as adverse possession) …”

iv)   Section 17

“Subject to the provisions of section 10, at the expiration of the period prescribed by this Ordinance for any person to bring an action to recover land (including a redemption action), the title of that person to the land shall be extinguished.

[Section 10 relates to land held on trust and is not relevant to this Appeal]”

23.  From the above, in order to succeed a claim for adverse possession, the Plaintiff, who is not the registered owner of Lot 916, should establish that (i) he has been in continuous and exclusive physical possession of Lot 916 for 12 years counting from the date of application (or 20 years before 1 July 1991); and (ii) he has the requisite intention to possess, i.e. the animus possidendi. These principles have been enunciated by Slade J (as he then was) in Powell v McFarlane[19], which have been confirmed by higher courts in England e.g. the House of Lords decision in JA Pye (Oxford) Ltd v Graham[20] and adopted by the Hong Kong Court of Final Appeal in a number of cases including, for instance, Wong Tak Yue v Kung Kwok Wai David & Another[21] and The Incorporated Owners of San Po Kong Mansion v Shine Empire Limited[22]. 

24.  At p.470-472 of Powell v McFarlane (supra), the learned Slade J stated the principles relating to (i) factual physical possession and (ii) the requisite intention to possess necessary for establishment of a case of adverse possession as follows:

“(3) Factual possession signifies an appropriate degree of physical control. It must be a single and conclusive possession, though there can be a single possession exercised by or on behalf of several persons jointly. Thus an owner of land and a person intruding on that land without his consent cannot both be in possession of the land at the same time. The question what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances…. I think what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no-one else has done so.

(4) The animus possidendi, … was defined by Lindley M.R. … as “the intention of excluding the owner as well as other people.” … What is really meant, in my judgment, is that the animus possidendi involves the intention, in one’s own name and on one’s own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the processes of the law will allow.

…An owner or other person with the right to possession of land will be readily assumed to have the requisite intention to possess, unless the contrary is clearly proved.  This is why the slightest acts done by or on behalf of an owner in possession will be found to negative discontinuance of possession.  The position, however, is quite different from a case where the question is whether a trespasser has acquired possession.  In such a situation the courts will require clear and affirmative evidence that the trespasser, claiming that he has acquired possession, not only had the requisite intention to possess, but made such intention clear to the world. If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi and consequently as not having dispossessed the owner.” (Emphasis added)

25.  In the present case, this Court accepts the Plaintiff’s father had been occupying Lot 916 since its acquisition by him on 3 Jan 1957. The intention to dispossess is obvious. The Plaintiff’s father built the said House for occupation of his family and it continues to be exclusively occupied by his second generation, i.e. the Plaintiff after he had passed away. The said House and some adjoining land[23] was enclosed by wire mesh with concrete base wall. The only access road to the enclosed area within which stands the said House was blocked with iron gate which was locked by the Plaintiff and his family. In the Court’s judgment, the Plaintiff’s father and the Plaintiff both have manifested an outward intention of excluding the whole world including the land owner, i.e. the Defendant, while they were in occupation of Lot 916.

26.  Most important of all, this Court believes that by virtue of the Chinese Agreement, the Plaintiff’s father, and the Plaintiff as well, have been dealing with Lot 916 as if it was theirs although the legal formality for a conveyance had not been completed. There is no requirement that in order to establish the requisite animus possidendi, a squatter intends to exercise exclusive physical control over the land wrongfully. He can act under the honest, but mistaken, belief that the land was his. It is the intention to possess, not the intention to dispossess that is important: see [9-38] to [9-43] Adverse Possession (2^nd Ed) 2011 by Stephen Jourdan QC & Oliver Radley-Gardner.

27.  The Defendant was dispossessed from Lot 916 continuously by the Plaintiff’s father as from the date of the Chinese Agreement, i.e. 3 January 1957, and later by the Plaintiff after the death of his father. According to s.8(1) of the Limitation Ordinance, the limitation period referred to in s.7(2) was 20 years. By 4 Jan 1977, the Defendant was time-barred from taking recovery action. By s.17 of the Limitation Ordinance, the Defendant’s paper title vis-à-vis the Plaintiff’s father was extinguished by then.

28.  The Plaintiff’s father passed away in 1986 and thereafter the Plaintiff, and later his family after getting married in 1987, continued to live in the said House erected on Lot 916 adverse to the Defendant. This Court considers that the period of adverse possession by the Plaintiff’s father can be added up to that of the Plaintiff. In Sze To Chun Keung v Kung Kwok Wai David & Anor[24] , the last appeal to the Privy Council from Hong Kong before the change of sovereignty[25], Lord Hoffmann has this to say:

“… At the time when proceedings were commenced, the defendant had been in possession on his own account for only two years. But this does not matter: the Limitation Ordinance is not concerned with whether the defendant has acquired a title but with whether the plaintiffs’ [i.e. the registered owner] right of action has been barred. For this purpose,all that matters is that there should have been continuous adverse possession for the period of limitation. The rights inter se of the successive persons who may have been in possession adversely
to the plaintiffs since they were dispossessed are for this purpose irrelevant.” (p.888I-J) (Emphasis added)

29.  In Sze To Chun Keung (supra), the defendant occupied a piece of land belonging to the plaintiff. However, both the defendant and the Government were under a mistaken belief that the land was Government land. The defendant occupied the land through Crown Permit until such time when the Government recognized the land in question was private. Thereafter the defendant occupied the land without Crown Permit. The Privy Council took the view that during the period of occupation when the defendant occupied as a licensee of the Government, it was the Government (instead of the defendant) who took adverse possession of the land. The Government did so through the defendant. When the Government ceased to grant the said permit it was the defendant who continued in adverse possession. The overall effect was that despite the relatively short period of possession taken by the defendant on its own adverse to the land owner, the Privy Council considered it irrelevant so long as there was continuous adverse possession for the period of limitation. It does not matter what in fact is the relationship between the Plaintiff and his father in respect of the occupation of Lot 916. The Defendant’s right to sue was lost through the continuous adverse possession of the Plaintiff’s father and the Plaintiff. Accordingly, the period of adverse possession established by the Plaintiff against the Defendant is well over 60 years.

30.  Similar views that successive possession by squatters can be added up to one’s own period of possession in order to complete the period of possession have in fact been expressed in a number of previous cases, for instance, Ng Lai Sim v Lam Yip Shing & Anor[26] and Tsang Tsang Keung v Fung Wai Man[27].

31.  Mr Au has drawn this Court’s attention to a rates demand notes issued by the Ratings and Valuation Department stating that the annual rateable value of Lot 916 and Lot 917 SA being HK$30,600 as at the 3^rd quarter of 2014. On a balance, this Court is satisfied that when the Originating Summons was issued on 21 April 2015, the annual rateable value of Lot 916 was less than $240,000, thus within the jurisdiction of the District Court under section 35 of the District Court Ordinance, Cap 336. This Court is also satisfied that even as ay the date of determination the application is well within the jurisdiction of this Court as prescribed by the District Court Ordinance[28].

32.  By the reasons above, this Court granted the declarations sought, with slight modifications on the orders proposed by the Plaintiff set out in Mr Au’s skeleton, as now finally set out in [2] above.