BREMONT INVESTMENTS LTD v. AU SHUI LIN AND OTHERS

LDCS 5000/2020

[2022] HKLdT 48

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

LAND COMPULSORY SALE MAIN APPLICATION NO 5000 OF 2020

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JUDGMENT

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BACKGROUND

1.  This is the applicant’s application for an order for sale, for the purposes of redevelopment under the Land (Compulsory Sale for Redevelopment) Ordinance, Cap 545 (“the Ordinance”), of all the undivided shares of and in New Kowloon Inland Lot No 5205 (“the Lot”) together with a building erected thereon known as Nos 23 – 34 Rose Street, Kowloon (“the Building”).

2.  The Building, which comprises 12 contiguous blocks (i.e. Nos 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33 and 34), is a 3-storey residential building over a single storey carport. Vertical circulation within each block is served by 1 common staircase. While each block of Nos 23, 24, 25, 26, 27, 29, 30, 31, 33 and 34 has 2 residential units (i.e. Units A and B) on each residential floor, each block of Nos 28 and 32 has 1 residential unit only per floor. According to the approved building plans, there are a total of 66 residential units and a total of 66 car parking spaces in the Building.

3.  Occupation permit No K149/67 was issued for the Building on 13 June 1967, granting permission to occupy its ground floor as car ports for non-domestic use and watchman’s quarters for domestic use, and its 1^st floor to 3^rd floor as 22 flats per floor for domestic use.

4.  According to the records of the Land Registry, the Lot is allocated 66 undivided shares. Each residential unit is given 1 undivided share, making up a total 66 undivided shares. No undivided share is separately allotted to each car parking space, which is assigned together with the corresponding residential unit.

SECTION 3 OF THE ORDINANCE – OWNERSHIP OF THE APPLICANTS

5.  At the time of filing of the Notice of Application (“NOA”) on 15 May 2020, there were 16 respondents and the applicant owned 80.30% (i.e. 53 out of the total 66) undivided shares in the Lot, more than the threshold of 80% required for building aged 50 years or above.

6.  Section 3(1) of the Ordinance prescribes that the minimum percentage of undivided shares that an applicant or applicants should possess before making an application under the Ordinance is 90%.

7.  Section 3(5) of the Ordinance provides that the Chief Executive in Council may, by notice in the Gazette, specify a lower percentage in respect of a lot belonging to a class of lots specified in that notice.

8.  The Land (Compulsory Sale for Redevelopment) (Specification of Lower Percentage) Notice, made under section 3(5) of the Ordinance (“the Notice”), was gazetted on 22 January 2010 and came into operation on 1 April 2010. Section 3 of the Notice lowered the threshold for compulsory sale of specified classes of lots from 90% to 80%. Those classes of lots include:

“a lot with each of the buildings erected on the lot issued with an occupation permit at least 50 years before the relevant date”

9.  Since the occupation permit of the Building was issued in 1967, i.e. more than 50 years before the date of application (i.e. 15 May 2020; the relevant date under the Notice), the applicable percentage is therefore 80%.

10.  I am satisfied that as at the date of application, the applicant owned on average more than 80% of the undivided shares in the Lot. I am therefore satisfied the applicant is entitled to make the present application under section 3 of the Ordinance.

THE REMAINING RESPONDENTS

11.  At the time of trial, the applicant owned 87.88% (i.e. 58 out of the total 66) undivided shares in the Lot. The following 11 respondents (except otherwise stated, the reference to “the respondents” in the discussion below refers to these remaining respondents) remain in the present action: -

Respondent		Premises
1st Respondent	(“R1”)	1st Floor of No 25A and CPS 42
2nd Respondent & 3rd Respondent	(“R2” & “R3”)	1st Floor of No 26B and CPS 35
8th Respondent & 9th Respondent	(“R8” & “R9”)	2nd Floor of No 30A and CPS 62
10th Respondent	(“R10”)	2nd Floor of No 31A and CPS 18
12th Respondent	(“R12”)	2nd Floor of No 33B and CPS 9
13th Respondent	(“R13’)	3rd Floor & Roof of No 30A and CPS 66
14th Respondent	(“R14”)	3rd Floor & Roof of No 33A and CPS 10
15th Respondent & 16th Respondent	(“R15” & “R16”)	3rd Floor & Roof of No 34A and CPS 5

12.  The respondents are all represented by Mr Jonathan Lee (“Mr Lee). The respondents do not oppose a sale order and put the applicant to strict proof as to whether the statutory requirements are satisfied under the Ordinance. In terms of valuation, the parties agree on existing use value (“EUV”) of all units in the Building, but they dispute on the assessment of redevelopment value (“RDV”) of the Lot. The respondents rely on the valuation evidence of Mr Denys Kwan (“Mr Kwan”) of C S Surveyors Limited.

13.  The applicant is represented by Mr Y C Mok (“Mr Mok”). The applicant appoints Mr Charles Chan (“Mr Chan”) of Savills Valuation and Professional Limited (“Savills”) as its valuation expert, and Mr Benson Wong (“Mr Wong”) of Benson Wong & Associates Limited and Mr K S So (“Mr So”) of K S So & Associates Limited as its building experts.

ISSUES FOR DETERMINATION BY THE TRIBUNAL

14.  The remaining issues to be decided in this case are as follows:

(1)  What was the respective EUV of all units in the Building as at 9 April 2020, the valuation date adopted in the application valuation report dated 14 May 2020, as assessed in accordance with Part 1 of Schedule 1 of the Ordinance?

(2)  Whether the redevelopment of the Lot is justified due to age and/or state of repair of the Building in accordance with section 4(2)(a) of the Ordinance?

(3)  Whether the applicant has taken reasonable steps to acquire all the undivided shares in the Lot on terms that are fair and reasonable in accordance with section 4(2)(b) of the Ordinance?

(4)  If an order for sale should be granted, what should be the reserve price (i.e. RDV of the Lot) for the purpose of auction sale?

DETERMINATION OF THE EUV OF ALL UNITS IN THE BUILDING

15.  Pursuant to section 4(1)(a)(i) of the Ordinance, if there is a dispute between the parties on the EUV of the units as assessed in the application, the tribunal shall determine the proper value. Section 4(1)(a)(ii) further provides that, in the case of any minority owner of the lot who cannot be found, the majority owner of the lot is required to satisfy the tribunal that the value of the minority owner’s property as assessed in the application is: -

“(A) not less than fair and reasonable; and

(B) not less than fair and reasonable when compared with the value of the majority owner’s property as assessed in the application.”

16.  There is no missing owner in these proceedings, and before the trial the parties have agreed on the EUV of all units in the Building. I agree to adopt the EUV as agreed by the parties.

EUV of All Units in the Building

17.  The EUV of all units in the Building as at the relevant date of valuation, i.e. 9 April 2020, and adopted by this tribunal are appended below: -

Floor

Flat

Car Parking Space

EUV ($)

1/F	No 23A	50	$16,570,000
2/F	No 23A	49	$16,260,000
3/F & Roof	No 23A	51	$16,710,000
1/F	No 23B	52	$16,570,000
2/F	No 23B	54	$16,260,000
3/F & Roof	No 23B	53	$16,710,000
1/F	No 24A	48	$16,480,000
2/F	No 24A	65	$15,605,000
3/F & Roof	No 24A	55	$16,045,000
1/F	No 24B	46	$16,480,000
2/F	No 24B	56	$15,605,000
3/F & Roof	No 24B	47	$16,610,000
1/F	No 25A	42	$16,070,000
2/F	No 25A	41	$15,770,000
3/F & Roof	No 25A	43	$16,190,000
1/F	No 25B	44	$16,320,000
2/F	No 25B	39	$16,010,000
3/F & Roof	No 25B	45	$16,460,000
1/F	No 26A	57	$14,465,000
2/F	No 26A	58	$14,195,000
3/F & Roof	No 26A	59	$14,565,000
1/F	No 26B	35	$16,770,000
2/F	No 26B	36	$16,010,000
3/F & Roof	No 26B	64	$15,705,000
1/F	No 27A	34	$16,790,000
2/F	No 27A	33	$16,480,000
3/F & Roof	No 27A	38	$16,830,000
1/F	No 27B	40	$16,830,000
2/F	No 27B	32	$16,520,000
3/F & Roof	No 27B	37	$16,980,000
1/F	No 28	28	$18,000,000
2/F	No 28	30	$17,660,000
3/F & Roof	No 28	31	$18,110,000
1/F	No 29A	24	$16,010,000
2/F	No 29A	22	$16,150,000
3/F & Roof	No 29A	20	$16,150,000
1/F	No 29B	26	$17,130,000
2/F	No 29B	27	$16,360,000
3/F & Roof	No 29B	29	$16,800,000
1/F	No 30A	63	$16,295,000
2/F	No 30A	62	$15,105,000
3/F & Roof	No 30A	66	$16,005,000
1/F	No 30B	21	$16,570,000
2/F	No 30B	23	$16,270,000
3/F & Roof	No 30B	25	$16,720,000
1/F	No 31A	15	$16,580,000
2/F	No 31A	18	$16,720,000
3/F & Roof	No 31A	19	$16,710,000
1/F	No 31B	14	$16,630,000
2/F	No 31B	17	$16,320,000
3/F & Roof	No 31B	16	$16,300,000
1/F	No 32	60	$12,445,000
2/F	No 32	61	$12,915,000
3/F & Roof	No 32	1	$13,225,000
1/F	No 33A	13	$15,160,000
2/F	No 33A	12	$15,160,000
3/F & Roof	No 33A	10	$15,950,000
1/F	No 33B	8	$15,510,000
2/F	No 33B	9	$15,940,000
3/F & Roof	No 33B	11	$16,750,000
1/F	No 34A	2	$15,710,000
2/F	No 34A	3	$14,840,000
3/F & Roof	No 34A	5	$15,140,000
1/F	No 34B	4	$14,140,000
2/F	No 34B	6	$13,890,000
3/F & Roof	No 34B	7	$13,720,000

$1,053,955,000

18.  I accept that the total EUV of the Building is $1,053,955,000.

SECTION 4(2) OF THE ORDINANCE - JUSTIFICATION AND REASONABLE STEPS

19.  Section 4(2) of the Ordinance provides as follows: -

“2. The Tribunal shall not make an order for sale unless, after hearing the objections, if any, of the minority owners of the lot the subject of the application under section 3(1) concerned, the Tribunal is satisfied that—

(a) the redevelopment of the lot is justified (and whether or not the majority owner proposes to or is capable of undertaking the redevelopment)—

(i) due to the age or state of repair of the existing development on the lot; or

(ii) on 1 or more grounds, if any, specified in regulations made under section 12; and

(b) the majority owner has taken reasonable steps to acquire all the undivided shares in the lot (including, in the case of a minority owner whose whereabouts are known, negotiating for the purchase of such of those shares as are owned by that minority owner on terms that are fair and reasonable).”

20.  The applicant must satisfy this tribunal the above statutory requirements are met; otherwise, an order for compulsory sale would not be granted.

Whether development of the Lot is justified due to the age and/or state of repair of the Building

21.  Mr So conducted a structural survey of the Building and prepared a Structural Assessment Report on 12 March 2021. Mr Wong conducted a condition survey of the Building and prepared a Condition Survey Report on 15 March 2021.

22.  None of the respondents adduced expert evidence to rebut the reports compiled by Mr So and Mr Wong.

23.  Having considered the reports of Mr So and Mr Wong, I accept their expert opinion. The Building, being erected more than 55 years ago, is in poor condition and has come to the end of its design life. The design of the Building has become obsolete over time in many aspects, both physically and functionally, and fails to conform to modern safety standards and statutory requirements.

24.  I am also of the view the Building is in poor state of repair and the costs of repair to bring the Building to tenantable condition is disproportionate to the construction costs of a similar superstructure. Even if repair works are carried out, such works will bring about a modest improvement only to the existing condition of the Building and the Building will continue remain a sub-standard one.

25.  By reason of the matters set out above, I am satisfied the redevelopment of the Building is justified.

Whether the applicant has taken reasonable steps

26.  In assessing the reasonableness of the offers, I have considered the case of Capital Well Ltd v Bond Star Development Ltd (2005) 8 HKCFAR 578. In particular, I have considered paragraphs 33 and 36 of the judgment in which Ribeiro PJ stated: -

“33. In making that assessment the Tribunal is not conducting a valuation exercise. It does not need to adjudicate upon any disputes about the correct valuation principles to be applied. It does not itself arrive at any conclusion as to what figure represents the correct valuation. It merely needs to be satisfied that, on the evidence available, the offer falls within the range of what may broadly be regarded as fair and reasonable compensation for the interest in question. It is obviously necessary to recognise that there will often be differences of opinion on that matter……”

“36. ...... We are of course not suggesting that it is necessary for the offer to “beat” the valuation as if it were a payment into court. What the Tribunal must do is to consider whether, in the circumstances of each case, the offer falls within a band of what represents a fair and reasonable assessment of the value of the minority owner’s interest reflecting a proportionate share of the redevelopment value of the whole site……”

27.  The applicant has made the following offers to the respondents respectively: -

Respondent

15-Apr-20

19-Apr-21

9-Feb-22

19-Jul-22

R1	$26,600,000	$28,900,000	$32,000,000	$31,900,000
R2 & R3	$26,700,000	$29,800,000	$33,300,000	$33,300,000
R8 & R9	$26,210,000	$28,500,000	$30,000,000	$30,000,000
R10	$27,610,000	$30,800,000	$33,300,000	$33,200,000
R12	$26,260,000	$27,800,000	$31,500,000	$31,700,000
R13	$27,320,000	$29,700,000	$31,800,000	$31,800,000
R14	$25,780,000	$28,000,000	$31,500,000	$31,700,000
R15 & R16	$25,080,000	$26,500,000	$30,000,000	$30,100,000

28.  The applicant’s offers have made reference the then valuation of Savills and reflected the pro-rata share of the RDV. Mr Mok submits that the applicant has taken reasonable steps in acquiring all the undivided shares in the Lot. I agree.

29.  On the evidence available, I accept that the offer prices have reflected the respective proportionate share of the RDV of the Lot and do fall within the range of what may broadly be regarded as fair and reasonable compensation for the interest in question.

RESERVE PRICE FOR THE AUCTION

30.  By reason of being satisfied that redevelopment of the Lot is justified and that the applicant has taken reasonable steps to acquire all the undivided shares in the Lot, I am satisfied an order for sale should be granted in favour of the applicant.

31.  Mr Chan and Mr Kwan agree to adopt residual valuation method and update their respective RDV assessments as at 30 June 2022. They also agree to develop the Lot on a registered site area of 3,619.47 square meters at plot ratio of 3 and gross floor area of 10,858.40 square meters. The hypothetical development scheme as agreed by them comprises two 7-storey residential blocks, including 4 apartment units on each ground floor to 4^th floor and 4 duplex units on 5^th to 6^th floor of each block, and six 3-storey houses over a carport with 66 private car parking spaces and a clubhouse at basement.

32.  They further agree on all saleable areas, ancillary areas and reference units in the hypothetical development and particulars of each comparables, but in the assessment of gross development value (“GDV”) they disagree on the adopted unit rates except for the unit rate of each car parking space at $4,200,000. In the residual valuation, they agree on marketing cost at 3% of GDV, professional fee at 6% on demolition and construction costs, stamp duty and legal cost on residual land value at 4.25% and 0.1%, demolition cost at $13,002,000 (i.e. about $2,200 per square meter), construction cost at 638,998,069 (i.e. about $58,848 per square meter gross), demolition period of 9 months and construction period of 3 years. However, they disagree on interest rate and developer’s profit.

GDV of Apartment Units

33.  Mr Chan and Mr Kwan propose to analyse 5 comparables and 6 comparables respectively, and 3 of them are common (i.e. Comparables A1, A2 and A3). Since there are not many common comparables, I agree with Mr Chan to further analyse Comparables A4 and A5 in Parc Inverness, though they were transacted in February and March 2020 more than 2 years before the valuation date. I also agree with Mr Kwan to further analyse Comparable A6 in Kadooria and Comparbles A7 and A8 in Ayton.

34.  I consider that the location of Kadooia, along Kadoorie Avenue and close to Prince Edward Road West, is similar to that of the Lot instead of much more prestigious as alleged by Mr Chan. There is also no concrete evidence that Comparable A6 should be an anomaly and/or a misled sale just because the transaction included fixtures and furniture and its previous first-hand sale had included substantial rebates from the developer.

35.  I consider that the flat mix of Ayton and the better view of Comparables A7 and A8 should not exclude them as comparables. The tender sale of these 2 comparables together would likely attract a discount instead of a premium as alleged by Mr Chan in the then market condition. Further, although there is a possibility that in the first-hand sale market developer would offer substantial commission to the property agent who would then rebate part of it to the buyer, Mr Chan who alleges such high commissions of at least 11% in Comparables A7 and A8 should have a burden of proof, but except for his word there is no other evidence. Nonetheless, the fact that Comparables A7 and A8 were sold by the developer should be particularly noted in the valuation.

36.  Mr Chan and Mr Kwan disputes on the conversion of the private lift lobby (i.e. 8 square meters) of Comparable A1 in Primrose. Mr Chan propose a rate of 4/5, but Mr Kwan suggests a lower rate of 1/2. With reference to the floor plan of Comparable A1 and its use as specified in clause 38 of the Deed of Mutual Covenant and Management Agreement, I prefer to adopt the rate of 2/3, and the effective saleable area of Comparable A1 should then be about 129.5 square meters.

37.  The 2 valuation experts agree on net consideration (i.e. excluding the value of each car parking space if any at $4,200,000) of each comparable and the adjustment for time with reference to time indices, adjustment for age at 0.5% per 1-year difference, adjustment for actual floor at 0.5% per 1-level difference and adjustment for size at 1% per 10-square meter difference. However, they disagree on the adjustment for location to Comparable A2 in Eden Gate and Comparable A6 in Kadooria, adjustment for facilities to Comparable A1 in The Primose, adjustment for view to Comparable A1 in The Primrose, Comparables A4 and A5 in Parc Inverness and Comparables A7 and A8 in Ayton.

38.  With benefit of the site inspection together with the parties, I agree with Mr Kwan that the adjustment for view to Comparable A1 should be -15% instead of -20% as proposed by Mr Chan, but I agree with Mr Chan that the adjustment for facilities should be 3% only instead of the higher rate at 10% as suggested by Mr Kwan. I am of the view the provision of clubhouse facilities in such medium scale upmarket development is not so influential on value, particularly when there is a private club nearby.

39.  In terms of view, I also agree with Mr Kwan that negative adjustment should be made to Comparables A7 and A8 towards Kowloon Tsai Park, but the rate should be -15% instead of -10% only as suggested by him or a very substantial rate as proposed by Mr Chan. On the other hand, I agree with Mr Chan that both Comparables A4 and A5 should have open view and some cemetery view, and Comparable A4 would face the cemetery much more directly, but the adjustment rates should be 0% and -3% respectively, instead of 0% and -5% as proposed by Mr Chan.

40.  Regarding the adjustment for location, I agree with Mr Chan that Eden Gate at the upper part of Kowloon Tong is better than the Lot, but the adjustment rate should be -2.5% only instead of -5% as proposed by him. Whilst, the location of Kadooria should be similar to the Lot.

41.  The valuation of the reference apartment unit is listed in Appendix I of the judgement. The average adjusted unit rate of all 8 comparables is $323,888; the average excluding Comparable A6, which appears out of line, is $311,860; and the average of the 3 common comparbles is $311,532. I consider the adopted unit rate of say $315,000 per square meter is fair and reasonable in this instance, and this should also be the average unit rate of all apartment units in the hypothetical development.

GDV of Duplex Units

42.  The 2 valuation experts agree on selection of 3 common comparables in Eden Gate. Except for the adjustment for location, they also agree on all other adjustments, same as those for the apartment units. In terms of location, similar to my comment on Comparable A2, I consider that the location of Eden Gate is better than the Lot, but the adjustment rate should be -2.5% only instead of -5% as proposed by Mr Chan and 0% as suggested by Mr Kwan.

43.  The valuation of the reference duplex unit is listed in Appendix II. The average adjusted unit rate of the 3 common comparables is $360,524, and I accept the unit rate of $360,000 per square meter. I also accept that the roof thereof should be converted at 1/6 as agreed by the parties.

GDV of Houses

44.  The 2 valuation experts agree on selection of 3 common comparables in Parc Inverness and No 62 Begonia Road. They also agree on the adjustment for time with reference to time indices, adjustment for location (i.e. 15% to Parc Inverness and 0% to No 62 Begonia Road), adjustment for layout (i.e. 0% to Parc Inverness and 15% to No 62 Begonia Road), adjustment for size at 1% per 15-square meter difference, adjustment for age at 0.5% per 1-year difference and adjustment for facilities (i.e. 0% to Parc Inverness and 3% to No 62 Begonia Road).

45.  Regarding the adjustment for house type, I agree with Mr Chan that 5%, instead of 10% as suggested by Mr Kwan, should be made to Comparables H1 and H3, which are terraced houses instead of semi-detached houses as proposed in the hypothetical development. I envisage that there will not be much open space between each semi-detached house in the hypothetical development and the house type in the circumstances would not have substantial impact on value.

46.  The 2 valuation experts agree on the adjustment for view to Comparable H1 in Parc Inverness at 0%, but they argue over the view of Comparables H2 and H3 in No 62 Begonia Road. I agree with Mr Chan that the view of the comparables in No 62 Begonia Road is better than the reference house unit, but the adjustment rate should be -2.5% only instead of -5% as proposed by Mr Chan. I envisage that, other than some mature trees, Comparables H2 and H3 would also overlook their nearby public housing blocks.

47.  The valuation of the reference house unit is listed in Appendix III. The average adjusted unit rate of the 3 common comparables is $457,374, and I accept the unit rate of $460,000 per square meter. I also accept that the corresponding garden/terrace should be converted at 1/4 as agreed by the parties.

RDV of the Lot as at 30 June 2022

48.  I agree with Mr Chan that the interest rate as at the valuation date is on a rising trend, which should have increased the hypothetical project finance cost in the residual valuation. Nevertheless, although the interbank rate has been increasing, the prime rate in Hong Kong is being kept unchanged. In the circumstances, I agree to adopt the interest rate at 4.25% per annum only instead of 4.5% as proposed by Mr Chan.

49.  Regarding the developer’s profit, I agree with Mr Chan that the property market as at the valuation date is relatively weak because of the Ukrainian War, pandemic and increase of interest rate. The rapid increase of inflation rate in the Western countries and the competition from other countries with lesser infection control over COVID-19 are the major concerns too in Hong Kong. In such relatively uncertain market, it is expected that the hypothetical developer in the residual valuation would demand a higher return in the development project.

50.  Nonetheless, I note that the construction period as agreed by the parties is 3 years, which in my opinion should be sufficient, or more than sufficient, for building 2 mid-rise apartment blocks and 6 houses only over a car parking and clubhouse basement in the hypothetical development. I am of the view it is practical to shorten the construction period in the subject residual valuation, which would increase the residual land value. On the condition that the construction period is maintained (agreed) at 3 years, I consider that the lower development risk of a longer construction period should be taken into consideration in the residual valuation and the developer’s profit in this instance should be fixed at 15% as suggested by Mr Kwan.

51.  Based on the agreements of the 2 valuation experts and the above determinations, the residual valuation of the Lot as at 30 June 2022 is listed in Appendix IV of the judgment. RDV of the Lot is assessed at $2,075,000,000, equivalent to an accommodation value of about $191,096 per square meter (i.e. about $17,753 per square foot), which should be the reserve price for public auction.

ORDERS

52.  I have set out reasons why I am satisfied an order for sale should be granted and I therefore make the following orders: -

(1)  All the undivided shares in the Lot, the subject of the application, be sold by way of public auction for the purposes of redevelopment of the Lot;

(2)  Mr Anthony Chow Wing Kin and Ms Anna Chow Suk Han, nominated by the applicant, be appointed the trustees (“the Trustees”) to discharge the duties imposed on them as trustees by the Ordinance in relation to the sale of the Lot;

(3)  The Trustees be authorized to charge such remuneration for their services in accordance with the terms set out in the letters of Messrs Guantao & Chow dated 15 February 2022 and 13 July 2022;

(4)  For the purposes of the sale of the Lot by public auction: -

a)  the sale of the Lot be on the particulars and conditions of sale the same or substantially the same as those set out in the draft Particulars and Conditions of Sale to be approved and initialed by the tribunal; and

b)  the reserve price be set at $2,075,000,000;

(5)  Subject to further extensions that the tribunal may subsequently allow upon the application of the purchaser of the Lot or its successor in title, the redevelopment of the Lot and the Building shall be completed and made fit for occupation within a period of 6 years after the date on which the purchaser of the Lot becomes the owner of the Lot;

(6)  For the purpose of redevelopment, the Lot shall include not only New Kowloon Inland Lot No 5205, but also (in the event of a successful lease modification or in-situ land exchange application which involves New Kowloon Inland Lot No 5205) the amended or new lot as may be granted or approved by the Director of Lands in such lease modification or land exchange (with or without a new lot number to be assigned by the Director of Lands); and

(7)  Liberty to the applicant, the 1^st respondent, 2^nd respondent, 3^rd respondent, 8^th respondent, 9^th respondent, 10^th respondent, 12^th respondent, 13^th respondent, 14^th respondent, 15^th respondent, 16^th respondent and their successors in title, and the Trustees to apply to the tribunal for further directions.

COSTS

53.  Following Good Faith [1], I make a costs order nisi that the applicant do pay costs of these proceedings to the respondents, on High Court scale with certificate for counsel and including any reserved costs, to be taxed if not agreed. Unless any parties apply by summons to vary, the costs order nisi shall be made absolute upon expiry of 14 days from the date of this judgment.