TSE LUEN KWAN v. CENTURY UNION HOLIDINGS LTD

HCA 849/2022

[2025] HKCFI 5966

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 849 OF 2022

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DECISION

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Introduction and Background Facts

1.  By Summons filed on 18 June 2025 (“the Summons”), the Plaintiff (“P”) applies for default judgment under O.19, r.7 of the Rules of High Court, Cap. 4A (“RHC”) against the Defendant (“D”). 

2.  P’s claim is based on the doctrine of adverse possession.  He claims possessory title to Lot No. 2674 in Demarcation District No. 116 located in Yuen Long, New Territories (“the Land”).

3.  On 8 July 2022, P issued the Writ of Summons (“the Writ”) against D. According to the Amended Statement of Claim filed on 18 June 2025 (“ASOC”):

(1)  D is the registered owner of the Land since 8 September 2010;

(2)  Since 1980, P and his family lived near the Land and owned property around the area;

(3)  In or around May 2010, P entered the Land with the intention of treating the Land as his own property;

(4)  P’s occupation of the Land was exclusive as he maintained the erected fences/walls demarcating the boundary of his occupation and also installed new locks on the existing structure and used the same as his personal storage space;

(5)  By reason of the matters aforesaid, P has had exclusive possession of the Land for over 12 years before the commencement of these proceedings accompanied by the requisite intention to treat the Land as his own to the exclusion of the world at large including the paper owner;

(6)  P was not aware that D had purchased the Land in September 2010 and D did not have possession or entered the Land both prior or after the acquisition of legal title;

(7)  By reason of the matters aforesaid, P has been in adverse possession of the Land for a period exceeding 12 years prior to the commencement of these proceedings and has acquired possessory rights, titles and interest of and in the Land;

(8)  D’s rights, titles and interests in and of the Land has been extinguished by virtue of sections 7 and 17 of the Limitation Ordinance, Cap. 347 (“LO”);

(9)  P claims:

(a)  A declaration that P has acquired a possessory title to the Land by adverse possession by virtue of sections 7, 8, 13 and 17 of LO;

(b)  A declaration that D’s title to the Land has been extinguished under sections 7, 8, 13 and 17 of LO; and

(c)  An injunction to restrain D whether by itself, its successor in title, agents, employee or advisors from interrupting or otherwise howsoever dealing with and/or from acting in a manner inconsistent with P’s possessory title of the Land.

4.  No notice of intention to defend and no defence was ever filed by D.

The Hearing on 29 September 2025

5.  At the first hearing of the Summons on 29 September 2025, I indicated that whilst I was satisfied from the affirmations of service filed on behalf of P that the Writ and Statement of Claim have been served on D at its registered office, I was not satisfied that the Summons had been served on D as would seem to be suggested in the Skeleton Submissions dated 25 September 2025 of Mr Chan, P’s counsel.  At paragraph 5, it was stated that by reason of D’s inaction despite “due service of all relevant documents” default judgment should be granted. 

6.  I clarified with Mr Chan if the Summons had been served on D.  At first, Mr Chan answered in the affirmative and purported to take me to the affirmations of service.  However, he later agreed with me that the affirmations of service did not state that the Summons had been served. 

7.  Mr Chan then submitted that as D had not acknowledged service, the Summons need not be served on D, not being a document required to be personally served on D, under O.65, r.9 of the RHC.  He referred me to Yang Tianhong v Wu Yue Yu & Anor [2024] HKDC 1171 which referred and relied on Chan Ting Ting v Zhang Qingrun [2023] 3 HKC 626 and Chan Pui Lok Daniel v Personal Representatives of Leung Shu Ming [2017] 4 HKLRD 625. 

8.  I note in Chan Pui Lok Daniel, DHCJ Joseph Kwan accepted that the court retains a discretion to direct service of the summons under O.65, r.9 of RHC for default judgment but did not consider it necessary on the facts of that case.  In that case, the 1^st defendant had died, the personal representatives could not be found, the 1^st defendant was subject to two court proceedings and default judgment for adverse possession had been obtained against him in his absence.  As for the other two defendants, they were mere trespassers.  See §§17-19.  However, although the learned judge disagreed with the DDJ J Chow’s reasoning and decision in Shue Huei Yue v Tang Chung Meng (unrep) DCCJ 2294/2013, 1 August 2014, that service of the summons for a default judgment for declaratory relief must be served on the defendant, he agreed that where a plaintiff is seeking a declaration that a defendant’s title to a property be extinguished that might be a case where the court would require service of the summons for default judgment (see §18).

9.  As for Chan Ting Ting, the addresses of the 1^st and 4^th defendants stated in the writ of summons were in the Mainland.  Service of the concurrent writ of summons had been dispensed with because there were no proper address of service of the 1^st and 4^th defendants. See §§21, 25 and 33.  I can therefore see why the court would not have required service of the summons for default judgment in the circumstances of that case. In any event, in that case the plaintiff had served the summons on the 1^st and 4^th defendants by pre-paid post “as an act of prudence” (see §§20 and 34).

10.  Furthermore, as I observed to Mr Chan at the previous hearing, the cases discussed in Hong Kong Civil Procedure 2025, Vol.1 §65/9/1 where service of documents were not required concerned cases where the defendant had been detained at a detention centre in China and his whereabouts were unknown (Camel Group Hongkong Investment Trading Co Limited v Leading International Group (HK) Limited & Ors [2018] HKCFI 2256) or was resident out of Hong Kong (Anthony Wong v Jian Xiaofei [2022] HKCFI 2924).  In China Ludao Technology Company Limited & Anor v Perfect Century Group Limited [2021] HKCFI 3855, Recorder William Wong SC granted leave for service of the Summons for default judgment and all other or further documents at the defendant’s registered office in the BVI “out of abundance of caution”. 

11.  Accordingly, out of abundance of caution, and given that D is not resident outside of Hong Kong or its address was unknown such that it would not cause undue costs and delay to these proceedings, in the exercise of my discretion under O.65, r.9, I directed P to serve the Summons on D.  The hearing of the Summons was adjourned to today.

Today’s Hearing

12.  From the affirmation of service filed on 9 October 2025 on behalf of P, I am now satisfied that D has been served inter alia the Summons and supporting affirmations at D’s registered office by ordinary post on 3 October 2025 which have not been returned.

13.  D did not appear at today’s hearing.  Given that D has now been served the Summons and has never participated in these proceedings notwithstanding service of the relevant court documents on it, I am of the view that it is expedient to proceed with the hearing of the Summons in D’s absence under O.32, r.5 of RHC.

14.  The applicable principles for default judgment under O.19, r.7 of RHC are well-settled.  The power to grant judgment under O.19, r.7 is discretionary.  The court is required to scrutinize whether the matters pleaded in the Statement of Claim entitle the plaintiff to the judgment sought.  The court’s decision is made on the basis of pleaded facts, rather than on evidence.  This is because where no defence is filed, the court will assume that the Statement of Claim has been impliedly admitted.  See Hong Kong Civil Procedure 2025, Vol.1, §§19/2/1, 19/7/11 and 19/7/14. 

15.  Moreover, the principle that a declaration will not be granted when giving judgment in default of defence is a rule of practice and not of law and will give way to the paramount duty of the court to do fullest justice to the plaintiff to which he is entitled.  Indeed, where declaratory relief is the only and substantial relief sought by the plaintiff, it may be necessary to make a declaration to do justice to the plaintiff.  However, the declaratory reliefs to be granted should not be in terms wider than what the plaintiffs are entitled to and what is necessary to do justice to them: see ibid, §§19/7/14 and 19/7/20. 

16.  As for the applicable principles for adverse possession, the requirements were helpfully summarized by DHCJ William Wong SC in Lam Clansmen Mutual Aid Association Limited v Lam Kam Loi, the Personal Representatives of Lam Yiu Chi, Deceased [2020] HKCFI 2816 at §17:

(1)  First, factual possession.  The adverse possessor must show a sufficient degree of physical control of the land.  In this connection, enclosure is probably the strongest possible evidence of adverse possession;

(2)  Second, animus possidendi, in other words an intention to possess the land to the exclusion of all other persons including the paper owner. Clear and affirmative evidence is required to show that such an intention to dispossess has been made sufficiently clear to the world, and particularly to the attention of the paper owner;

(3)  Third, the requisite time period.  For non-Government lands, the time period is 12 years: section 7(2) of LO; and

(4)  The combined effect of the common law, together with sections 7, 8, 13 and 17 of LO, is that for non-Government lands, the paper owner’s title would be extinguished vis-à-vis the adverse possessor after 12 years of continuous exclusive possession with the requisite animus possidendi.

17.  I am satisfied that there is sufficiently and properly pleaded both factual possession and the requisite intention to possess the Land by P for more than 12 years prior to the commencement of this action.  P occupied the Land to the exclusion of others, maintained the erected fences/walls over the years, installed new locks and used the Land enclosed by him which demonstrate exclusive possession and the requisite intention to possess.

18.  Furthermore, I am satisfied that as the declaratory reliefs are the only and substantial relief sought, there is a genuine need to grant the declarations sought to do fullest justice to P.  The courts have previously granted declaratory relief in adverse possession cases: see Lin Loi Hing v The Personal Representative of Lin Lok Shi also known as Lok Kiu (deceased) & Anor [2024] HKCFI 3056; Shum Sau Yuen v The Estate of Sum Kar Fun, Deceased & Anor [2024] HKCFI 304 and the cases cited therein at §§13 and 14.

19.  I therefore will order that judgment be entered against D as follows (reflecting the pleaded relief in the Indorsement of Claim and being no wider that what P is entitled to and is necessary to do justice to):

(1)  A declaration that P, having been in adverse possession of the Land for a period exceeding 12 years prior to the commencement of these proceedings, has acquired possessory title, interest and/or rights in and of the Land by virtue of sections 7, 8, 13 and 17 of LO;

(2)  A declaration that D’s title, rights and interest of and in the Land has been extinguished by virtue of sections 7, 8, 13 and 17 of LO; and

(3)  There be no order as to costs of this action, including the costs of the Summons.