KWOK WING FAT v. THE PERSONAL REPRESENTATAIVE OF THE ESTATE OF KWOK CHUN KAN, DECEASED

HCA 2243/2018

[2023] HKCFI 1242

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2243 OF 2018

_____________

BETWEEN

_____________

__________________________________

REASONS FOR JUDGMENT

__________________________________

1.  This is the application of Kwok Wing Fat (“the Plaintiff”) by summons dated 6 April 2023 (“the Summons”) for a default judgment against the Personal Representative of the Estate of Kwok Chun Kan (郭震強), Deceased (“the Defendant”) on the Plaintiff’s adverse possession claim for declaratory relief. At the conclusion of the hearing, the court granted the declaratory relief sought. My reasons appear below.

2.  The subject matter of the Plaintiff’s claim is a unit located on the 3^rd floor of No 21 Wing Kwong Street, Kowloon, Hong Kong (“the Flat”) in the building situated on Kowloon Marina Lot No 52 S.B. ss 11 SE s.11 RP (“the Lot”). The Deceased had been its registered owner since 24 June 1958.

3.  The Deceased died in Ho Chi Minh City, Vietnam on 18 May 2005 leaving surviving him in Vietnam his wife (name unknown) and 2 children Kwok Chi Minh and Kwok Chi Quang (collectively “the next-of-kin”). None of the next-of-kin appears to have administered or applied for administration of the Deceased’s estate.

4.  The Lot was resumed and reverted to the Government on 6 December 2019 (“the resumption date”) which had the effect of extinguishing the Deceased’s and his estate’s paper title the same day.

Procedural history

5.  The writ in this action was issued on 24 September 2018, some 15 months prior to the resumption date. It was amended on 13 November 2018 to include the last known address of the Deceased in Vietnam (“the Vietnam address”) as the Defendant’s address for service.

6.  The court has been provided with a detailed account of the procedural history with supporting affirmations which explain why the Summons could not have been taken out until some 4 ½ years after the writ was first issued.

7.  It suffices to outline the following matters which accounted for the delay:

(a) difficulties in locating and seeking (and successfully) to persuade the next-of-kin to be appointed to represent the Defendant for service of the amended writ, requiring renewal of its validity for 12 months from 24 September 2019;

(b) the need for an order appointing the Official Solicitor to represent the Defendant but limited to the purpose of accepting service of the amended writ, with service being effected on 11 October 2019 and after which the Official Solicitor became functus officio with no person capable of acknowledging service of the amended writ on behalf of the Deceased’s estate;

(c) the application for the usual carry-on order[1] in the absence of the Defendant was made on 23 October 2019, but the order was not forthcoming until [2] 19 July 2022[3]; and

(d) the need to obtain leave to file and serve their statement of claim out of time.

8.  Pursuant to RHC O. 13, r. 6(1), after service of the statement of claim (“SOC”) the Plaintiff was to proceed with the action as if the Defendant had given notice of intention to defend.

9.  The SOC was amended on 6 March 2023 pursuant to RHC O. 20, r 3. (1). The amended SOC (“ASOC”) was duly served out to the Defendant on 8 March 2023 at the Vietnam address.

10.  No defence has ever been filed[4].

11.  The Summons was duly served out to the Defendant on 6 April 2023 together with a Notice of Intention to Enter Judgment of even date pursuant to RHC O. 19, r. 8A(1)(a).

Legal principles

12.  A convenient summary of the court’s practice in relation to the grant of declaratory relief in a default judgment application (set out in Hong Kong Civil Procedure 2020[5] at §19/7/20) may be found in Lam Clansman Mutual Aid Association Limited v Lam Kam Loi, the Personal Representatives of Lam Yiu Chi, Deceased [2020] HKCFI 2816 at §14 as follows:

“(a) It is not the normal practice of the Court to make a declaration without a trial, particularly where the declaration is that the defendant in default of defence has acted fraudulently.

(b) However, this is only a rule of practice which should not be followed when the plaintiff has a genuine need for the declaratory relief and justice will not be done if such relief are denied.

(c) Where declaratory relief is sought, the Court will scrutinise the application for default judgment carefully and does not hastily grant the relief sought.

(d) The declaratory relief 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.”

13.  Apart from the Lam Clansman case itself, relief was also granted in Law Yuk Fong v Man Chung Wai and Anor HCA 2195/2015 at §§18-21 and 50.

14.  For adverse possession, 3 elements have to be satisfied[6]. They are conveniently set out in the Lam Clansmen case (at §17) as follows:

“(a) 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.

(b) 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.

(c) Third, the requisite time period. For non-Government lands, the time period is 12 years: section 7(2) of the Limitation Ordinance (Cap 347) (“the Ordinance”).

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

Whether the Plaintiff had acquired an indivisible possessory title

15.  In determining this question, it is well-established that the court cannot receive any evidence in an application pursuant to RHC O.19, r. 7: see HKCP 2023 at §19/7/11. The court looks to the pleaded facts alone and no other evidence will be permitted: see Lam Chi Fat v Liberty International Insurance [2002] 3 HKLRD 480 at §27.

16.  The facts upon which the Plaintiff relies to show his exclusive, continuous and uninterrupted possession of the Flat since 18 May 2005 (a period of more than 15 years) are as follows:

(i) the Plaintiff began occupying the Flat at the invitation of the Deceased in 1960 as the latter’s bare licensee when the Deceased left for Vietnam;

(ii) the Deceased’s death on 18 May 2005 had the effect of revoking the bare licence previously granted to the Plaintiff;

(iii) thereafter, the Plaintiff remained in occupation and physical possession of the Flat until 31 August 2020 when the Lot was resumed and vacant possession of the Flat was delivered to the Government;

(iv) he was the only person who had the keys and access to the Flat and no one (including the next-of-kin) could access it without his consent;

(v) the Plaintiff had been responsible and had met all outgoings, expenses for the Flat and its maintenance, including Government rent and rates, management fees, and utility bills and had contributed $30,000 for the repair of the common areas and exterior wall of the building; and

(vi) at all material times, the Defendant had not exercised any of the rights and powers as personal representative on behalf of the estate in recovering possession of the Flat.

17.  Ms Tasman Tam, counsel for the Plaintiff, submitted that as an offer of compensation under sections 6 (1) and 8 (1) of the Lands Resumption Ordinance, Cap 124 will only be made to the former owner or to any person having an estate or interest in the land immediately before reversion, the fact (which occurred after the issuance of the writ) that the Plaintiff signed a “Form A” with the Urban Renewal Authority (“URA”) on 14 January 2020 and an agreement on 25 February 2020 is significant. The URA would not have done so had it not accepted that the Plaintiff had an interest in the Lot immediately before the resumption date.

18.  Form A is the Plaintiff’s undertaking to deliver vacant possession of the Flat upon receipt of the settlement sum from URA. The agreement with the URA gave the Plaintiff the choice of accepting the rehousing benefit and/or additional ex gratia allowance in consideration of his agreeing to return vacant possession of the Flat. Those matters undoubtedly speak to the Plaintiff’s factual continuous occupation and possession of the Flat.

19.  So far as the Plaintiff’s animus possidendi is concerned, since the Deceased’s death, the Plaintiff had been in sole possession, occupation and control of the Flat in his own name with exclusive access to it and to the exclusion of all other person (s) (including the next-of-kin).

20.  On the pleaded facts, the Plaintiff has shown that for a continuous period in excess of 12 years from 18 May 2005 (the date of the Deceased’s death when the right of action accrued to the Deceased’s estate) he had continuously exercised acts of ownership over the Flat in his own name, with uninterrupted possession and control, adverse to the estate of the Deceased, and any beneficiary entitled to an interest therein.

21.  The conditions stipulated in §7(2) of the Limitation Ordinance Cap 347 (“the LO”) having been satisfied, the title of the Defendant to the Flat was extinguished vis-a-vis the Plaintiff by virtue of the §17 of the LO at the earliest, on 18 May 2017 (12 years from the Deceased’s death) or, alternatively, at the latest on 24 September 2018 (the date of issuance of the writ).

22.  I am satisfied on the facts as pleaded that the Plaintiff had obtained an indefensible possessory title.

Declaratory relief

23.  The Plaintiff seeks (1) a declaration that the Defendant’s title, interest and/or rights in and/or over the Property had been extinguished vis-a-vis the Plaintiff by virtue of section 17 of the Limitation Ordinance on 18 May 2017 or alternatively the latest on 24 September 2018; and (2) a declaration that the Plaintiff had been in adverse possession of the Property for a continuous period of no less than 12 years within the period from 18 May 2005 to 24 September 2018 and had thereby acquired a possessory title, interest, and/or rights on and/or over the Property vis-a-vis the Defendant.

24.  The Plaintiff submitted that this is an appropriate case for the court to grant declaratory relief:

(a) upon resumption of the Lot, the Defendant’s title vis-a-vis the Government was extinguished;

(b) despite having knowledge of the proceedings and been served with the amended writ, the ASOC, the Notice of Intention to Enter Judgment and the Summons, the Defendant chose to remain absent and has shown no interest whatsoever in asserting any interest in the Flat;

(c) no useful purpose would be served by requiring the Plaintiff to go through a full trial;

(d) the declaratory relief sought would enable the Plaintiff to pursue further compensation from the URA on the basis of a possessory title, going beyond the standing of an occupant.

25.  The relief sought relates to the state of affairs prevailing at the point in time when the 12-year limitation period expired. The fact that a change of circumstances occurred after the issuance of the writ (i.e. the resumption of the Flat), rendering the question whether the Plaintiff had acquired possessory title to the Flat through adverse possession academic or of little practical significance, has no effect on the court’s jurisdiction and discretion to grant declaratory relief.

26.  Tam Bing Choi and Others v Hui Sim Kiu and Others [2021] HKCFI 3751 and the authorities cited at §39 of that case show that there is no requirement that a claimant must be in a position to demonstrate that he will benefit in the material or tangible way as a result of the declaration[7] and in deciding whether or not to exercise its discretion, the court will closely examine the relevance or the utility of any decision[8].

27.  In Woolf’s The Declaratory Judgment at §4-91 it is stated that

“If a declaration will still serve some purpose, then the court will be favourably disposed to granting declaratory relief.”

28.  In the present case, a declaration would undoubtedly serve a useful purpose: see §24 (d) above.

Conclusion

29.  For the reasons set out above, I made an order in terms of §1 of the Summons and further ordered that there be no order as to costs.