Jade City International Ltd. v. Director of Lands

LDMR 45 OF 2000

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS REFERENCE APPLICATION NO. 45 of 2000

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D E C I S I O N

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1. On 26.9.2000, the Applicant lodged a Notice of Application in the Lands Tribunal, requiring the Lands Tribunal to determine under section 12 of the Sewage Tunnels (Statutory Easements) Ordinance, Cap. 438 ("the Ordinance") the Applicant's claim for compensation for loss and damage to land, being Tseung Kwan O Town Lot No. 62, Area 62A ("the Land"), or property situated on the Land and further, or alternatively, the Applicant's claim for compensation for diminution in value of the Land as a result of the creation of rights, or the exercise of rights created, under the Ordinance.

2. In the Notice of Opposition, the Respondent denied any liability as alleged by the Applicant. Ground (1) of the Notice of Opposition reads: -

"(1) Section 12 of the Ordinance, properly construed, entitles a person to claim statutory compensation only if that person has an interest in any of those pieces of lands specifically identified in the notice published in the Gazette on 11 March 1994 (GN822, Gazette No. 10/1994) pursuant to section 4 of the Ordinance and the notice published in the Gazette on 29 July 1994 (GN2782, Gazette No. 30/1994) pursuant to section 6 of the Ordinance whereby section 10 of the Ordinance is ordered to be applicable in granting certain rights to the Government under the Ordinance. The Land of the Applicant is not one of those pieces of land specifically identified in the aforesaid notices published in the Gazette and no statutory rights have been created or exercised over the Land in accordance with section 10 of the Ordinance by the Government. The Applicant is thus not entitled to claim compensation under section 12 of the Ordinance."

(Underlines provided)

3. In the Notice of Opposition, the Respondent further averred that it would apply to the Lands Tribunal for the said Ground (1) be disposed of as a preliminary point of law. On 28.11.2000, the Respondent took out a summons returnable on 12.12.2000 for a hearing to be heard on its application for an order that the said Ground (1) be tried as a point of law at a preliminary hearing pursuant to Rule 18 of the Lands Tribunal Rules, Cap. 17. On 28.12.2000, I made a ruling in favour of the Respondent. At page 5 of my decision, I stated: -

"In my judgment, if a preliminary hearing is to be held the preliminary point of law to be decided will be: is the "land" referred to in section 12 confined to the "land" identified in the plans referred to in the schedule attached to the Gazette notice in question, or is the "land" referred to in section 12 any piece or parcel of land, irrespective of whether it has been referred to in the schedule attached to the Gazette notice in question?"

4. On 16.5.2001 and 30.6.2001, the parties argued the preliminary point of law before me.

5. The answer to the question posed in the preliminary point of law necessarily requires the Tribunal to find out the intention of the Legislature as to whether any qualification should be attached to the word "land" in section 12. In this regard, section 12 and other relevant sections of the Ordinance have to be examined. The relevant subsections of section 12 are set out as follows: -

"(1) Subject to this section, the Government shall be liable to pay compensation to any person who has suffered loss or damage to land (including any diminution in the value of the land) or property situated on land as a result of the creation of rights, or the exercise of rights created, under this Ordinance.

(2) For the avoidance of doubt, "loss or damage as a result of the creation of rights under this Ordinance" in subsection (1) includes, where such right have been created, any loss or damage as a result of a decision of the Building Authority under section 17A of the Building Ordinance (Cap. 123).

...........................................

(13) No action, claim or proceedings shall lie or be brought against the Government or any other person to recover damages or compensation for loss or damage to land or any property situated on land as a result of the creation of rights, or the exercise of rights created, under this Ordinance except in pursuance of the rights to compensation provided for in this section."

6. An analysis of section 17A of the Building Ordinance will be useful in ascertaining the intention of the Legislature. Section 17A reads: -

"17A. Incompatibility with sewage tunnel works

(1) Notwithstanding anything in this Ordinance, where the Building Authority is of the opinion that any building works or the commencement of any building works would be incompatible with any sewage tunnel works or proposed sewage tunnel works, he may to such extent as is necessary to avoid such incompatibility -

(a) refuse to give his approval to any plan or to consent to the commencement of the building works;

(b) withdraw any approval which he has or is deemed to have given to any plan or any consent to the commencement of the building works;

(c) impose conditions on the giving of approval of plans showing piling works, excavation works or foundation works or consent to commence such works.

(2) In this section -

"proposed sewage tunnel works"（擬建污水隧道工程）means sewage tunnel works likely to be undertaken in connection with a proposed sewage tunnel referred to in a notice published in the Gazette pursuant to section 4 of the Sewage Tunnels (Statutory Easements) Ordinance (Cap. 438);

"sewage tunnel works"（污水隧道工程）has the same meaning as "tunnel works" in the Sewage Tunnels (Statutory Easements) Ordinance (Cap. 438)."

7. Under section 2(1) of the Building Ordinance, the term "building works" is defined to include "any kind of building construction, site formation works, ground investigation in the scheduled areas, foundation works, repairs, demolition, alteration, addition and every kind of building operation." The term also includes drainage works. From the nature of building works shown in this definition, it is clear that such works have to be done on a piece of land. In my judgment, they can only be done in either one of the following scenarios: -

1. on a piece of land over which statutory easements are created, as specifically identified in Gazette notices published pursuant to section 4 or section 6 of the Ordinance ("Land 1");

2. on a piece of land ("Land 2") over which no statutory easements are created;

3. on a piece of land comprising land ("Land 3A") over which statutory easements are created, as specifically identified in Gazette notices published pursuant to section 4 or section 6 of the Ordinance, and land ("Land 3B") over which no statutory easements are created.

8. Under s. 17A, there is no reference to the location where the building works are to be done. This accords with good common sense. If the decision of the Building Authority only applies to the building works on the land over which statutory easements are created, as specifically identified in the relevant Government notices, then the measures taken by the Building Authority will simply be unable to avoid the incompatibility as referred to in section 17A(1). For instance, if the building works causing the incompatibility are to be performed on Land 2 and Land 3B, but the decision made by the Building Authority only applies to Land 1 and Land 3A, the measures taken by the Building Authority simply cannot avoid the incompatibility caused by the building works, because the decision it makes does not apply to the land on which the building works are to be done. Under section 17A, so long as the building works are incompatible with the sewage tunnel works or proposed sewage tunnel works, the Building Authority has to make a decision to take measures to avoid the incompatibility, irrespective of the location of the land on which the building works are to be performed.

9. When the Building Authority makes a decision under section 17A, it will cause loss or damage to the land on which the building works are to be done, and the Government is liable to pay the land owner compensation under s. 12 of the Ordinance. Therefore if the decision made by the Building Authority affects the building works to be done on Land 1, Land 2 or Land 3, then the Government shall be liable under s. 12 of the Ordinance to pay compensation to owners of these pieces of land. Thus the compensation covers the loss or damage to land irrespective of whether statutory easements are created over it or not. This loss or damage to land as a result of the decision of the Building Authority is included within the meaning of loss or damage as a result of the creation of rights under section 12(1). This loss and damage is the loss or damage to land. Therefore the land in subsection 1 must include land over which statutory easements may or may not be created.

10. That being the intention of the Legislature, the "land" referred to in section 12 of the Ordinance cannot be restricted to a piece of land over which statutory easements are created. If it is so restricted, the loss or damage as a result of the creation of rights under the Ordinance will be confined to loss or damage to Land 1 and Land 3A. That would narrow down the scope of the term "any loss or damage as a result of a decision of the Building Authority". The use of the word "any" in the phrase "any loss or damage" in section 12(2) indicates that so long as the loss or damage is occasioned by the decision of the Building Authority, it is within the meaning of "loss or damage" in subsection 2. If any loss or damage to Land 2 and Land 3B is caused by the decision of the Building Authority, such loss or damage must accordingly come within the context of "loss or damage" in s. 12(2), and hence s. 12(1).

11. The above analysis shows that the "land" in the above 3 scenarios must come within the context of the word "land" in s. 12(1). This explains why the word "land" in s. 12(1) is unqualified.

12. In his written submission the Respondent's Counsel, Mr. Wong Yan Lung, made the following comments on the purpose and effect of s. 17A: -

"Under section 17A of Cap.123, in essence, the Building Authority can decide to stop or prevent or regulate any building works to be done which is incompatible with any sewage tunnel works or proposed sewage tunnel works, including imposing conditions on approving plans showing "piling works, excavation works or foundation works" (s.17A(1)(c)). The purpose is clearly to protect the structural integrity of the tunnel placed underneath the land where rights under the Ordinance have been created. It confirms that the intended claimant for compensation must be persons interested in such land, over or in which the statutory easement is created."

The last sentence in the above paragraph cannot be correct, because the building works which cause incompatibility may be done on a piece of land over which no statutory easements are created and the owner of this piece of land is also entitled to compensation.

13. It is useful to refer to other parts of the Ordinance to ascertain the intention of the Legislature as to whether the word "land" under s. 12(1) is only confined to that identified in the plans referred to in the schedule attached to Gazette notices published under section 4 or section 6 of the Ordinance. The relevant sections, namely, 3 to 8, 10 to 11, and 14 are set out as follows: -

"3. Plans relating to sewage tunnels

Where the Government proposes to construct any sewage tunnel, the Secretary shall cause to be prepared a plan -

(a) ........................

(b) identifying the land situated on the route of the proposed tunnel.

4. Publication of plans

(1) ........................

(2) A notice of a plan shall -

(a) .....................

(b) describe the land situated on the route of the proposed tunnel; ..................

(c) state the proposed minimum depth below the surface of the land at which the tunnel will lie;

(d) contain a statement to the effect that any person having an estate or interest evidenced in an instrument registered in the Land Registry in any land situated on the route of the proposed tunnel may object to the proposal ............................

(e) indicate that certain easements and other rights may be created in favour of the Government over such land on the expiry of the period specified .............

5. Objections

(1) Subject to this section, any person who has an estate or interest evidenced in an instrument registered in the Land Registry in any land situated on the rate of a proposed tunnel may object to the route ..................

(2) ..............................

(3) A notice of objection shall -

(a) describe the estate or interest of the objector in the land;

(b) .......................

6. Procedure if no objection made

(1) .......................... the Secretary may order that section 10 shall apply in respect of any land identified in a plan prepared for the purposes of section 3 ...............

(2) The Secretary shall published in the Gazette notice of any order made by him under this section, and such notice shall describe the land to which the order applies.

7. Procedure if objection made

(1) ........... the Chief Executive in Council ............ may if thinks fit order that section 10 shall apply in respect of any land identified in a plan prepared for the purposes of section 3 .....................

(2) ........................

(3) Notice of an order made by the Chief Executive in Council ............... shall describe the land to which the order applies.

(4) Where a plan is amended ............ such that the route of the proposed tunnel passes through land not previously identified in the plan as land situated on the route of the proposed tunnel, sections 3 to 6 and this section shall apply ........................

8. Orders made under section 6 or 7

(1) ...........................

(2) ...........................

(3) For the purposes of section 2 of the Land Registration Ordinance (Cap. 128), an order made under 6 or 7 and applying in respect of any land shall be deemed to be an instrument by which such land may be affected, ..................

10. Statutory easements

(1) Subject to this Ordinance, the Government may exercise from time to time all or any of the following rights over any land identified in an order made under section 6 or 7, that is to say the right -

(a) to place and keep any sewage tunnel under such land and to transfer sewage through such tunnel;

(b) ........................

11. Rectification of plan

.....................

(4) Where as direction made by the Chief Executive under subsection (1) for the rectification of any plan identifies land situated on the route of a tunnel as constructed, being land not previously identified in other plan for the purposes of section 3, the Secretary may by notice published in the Gazette order that any reference in this Ordinance to land identified in an order made under section 6 or 7 shall be construed as including a reference to land so rectified in the direction.

14. Offence to obstruct exercise of right of Government

(1) Any person who, hearing been given notice by the Government of its intention to exercises rights created under section 10 in respect of any land, wilfully obstructs or interferes with the lawful exercise of those rights commits an offence."

(Underline added)

14. In all the sections listed before, the "land" referred to is clearly identified. Likewise the Legislature could have evinced its intention by putting words in section 12 to qualify the word "land", in the way suggested by Mr. Wong. But it did not do so. That reflects the intention of the Legislature that no qualification is to be imposed on the word "land", so that it is "land" at large. This would be consistent with the operation of section 17A.

15. Mr. Wong submitted that the qualifying words on the word "land" in section 12(1) came from the phrase "as a result of the creation of the rights, under this Ordinance". He cannot be right. Grammatically a noun (Here the noun is the word "land") can only be qualified by an adjective or adjectival phrase. But the quoted phrase is an adverbial phrase. If the word "land" is read together with the quoted phrase, no sense can be made out of it. The adverbial phrase "as a result of " qualifies the verb "has suffered". The quoted phrase shows the cause leading to the consequence of "has suffered loss or damage to land (including any diminution in the value of the land) or property situated on land".

16. If the word "land" in s. 12(1) is construed as "land over which statutory easements are created, as specifically identified in the relevant Gazette Notices", then subsection (2) would be inconsistent with subsection (1), because under subsection (2) the Government is liable to pay those people who have suffered loss or damage to Land 2 and Land 3B, as a result of a decision of the Building Authority made under s. 17A.

17. If under subsection (2) compensation for loss or damage to land is only payable to those owners of land over which statutory easements are created, as specifically identified in the relevant Gazette Notices, then a strange situation will be created in scenario 3. The landowner will be paid compensation for the loss and damage to Land 3A, but not for the loss and damage done to Land 3B, when in both circumstances the causation and nature of the loss and damage are the same. That cannot be the intention of the Legislature.

18. In conclusion, I do not accept Mr. Wong's submission. I rule that the word "land" referred to in section 12 of the Ordinance is not confined to the "land" identified in the plans referred to in the schedule attached to the Gazette notice in question; it can be any piece of land, irrespective of whether it has been referred to in the schedule attached to any Gazette notice.

19. Costs

I make an order that costs relating to this preliminary hearing be to the Applicant (including certificate for Counsel), to be taxed if not agreed.