LAM HUNG KWAN v. MAK WAI LAN

Property law - application by landlord for possession of alleged Part IV domestic premises on the ground that on the expiration of the contractual tenancy the tenant has not applied for a new tenancy or yielded up vacant possession - respondent opposes application on the ground that the premises remain subjectto Part II because on or before 10 June 1983 she was already in possession of part of the premises as a sub-tenant - Held : 1. On the facts respondent not estopped from disputing classification of premises nor had she waived that right; 2. Section 50(6)(o) also excludes from Part IV new tenancies created after 10 June 1983 if on that date the tenant was already in possession even if merely as a sub-tenant and of only part of the premises; 3. The endorsement of the receipt of Form CR109 by the Commissioner of Rating and Valuation does not affect or alter the classification of domestic premises; 4. The suit premises consequently remain subject to Part II and the application for a new tenancy under Part IV is dismissed.

IN THE LANDS TRIBUNAL OF HONG KONG

L.T. Application No. 5056 of 1989

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JUDGMENT

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1. The applicant is the landlord of the domestic suit premises situate at 36 Western Street, 1st Floor, Hong Kong. The applicant claims vacant possession against the respondent tenant on the ground that the current tenancy was terminated in accordance the provisions of Part IV of the Landlord and Tenant (Consolidation) Ordinance but the respondent has failed within the time limited thereunder, to apply to the Lards Tribunal for a new tenancy. In fact the application is expressed as being brought pursuant to Section 119D (3)(a) (ii) of Part IV but that statutory basis is misconceived.

2. Unlike the position in Part II, there is no statutory ground under the Ordinance on which a Part IV landlord may bring an application for vacant possession. Statutory applications may only be brought by landlords under Part IV for other limited purposes such as interiai rent pursuant to Section 119M(4) and rent pursuant to 119NA (2). In the exercise of the Tribunal's discretion; it shall be deemed for the purpose  of the present application that it is brought at eonmmonlaw. The non statutory rights of landlord are preserved by Section 117 (2).

3. The material facts are not in dispute. The respondent was earlier before 10th June 1983, the sub-tenant of the whole of the suit premises comprising over 400 square feet, except for one bedroom, from the then principal tenant Mr. Wong Chung Ping. The bedroom excluded from the sub-tenancy was occupied by Mr. Wong's son and comprised about 100 square feet. The applicant in 1986 took proceedings for vacant possession against Mr. Wong Chung Ping under Lands Tribunal Application No. 265/86. The proceedings were settled on the basis that Mr. Wong would deliver up vacant possession and the applicant would grant a new tenancy of the whole of the suit premises to the present respondent. In terms of that settlement the present parties, who were both then represented, on 15th December 1986, entered into a tenancy agreement for a duration of 3 years commencing on 1st November 1986. The applicant's solicitors duly gave notice of the new tenancy to the Commissioner of Rating and Valuation on the prescribed , Form CR109, pursuant to Section 119L. The Commissioner on 24th December 1986 endorsed his receipt of the Notice and returned endorsed copies to the applicant's solicitors. It is common ground that one copy was then forwarded to the respondent's solicitors who in turn sent it on to her.

4. On 30th April 1989 the applicant served on the respondent the prescribed Form CR101 notice terminating the tenancy as at the expiration of its contractual duration, namely on 31st October 1989. The applicant in that notice indicated that he would not oppose the grant of a new tenancy and proposed that the rent be increased from $1800 per month to $3200 per month. On 26th June 1989 the respondent served on the applicant Form CR102 giving notice that she intended to apply to the Lands Tribunal for a new tenancy. It is common ground that no application was made by her for a new tenancy before the current tenancy was terminated as at 31st October 1989.

5. The respondent, fully aware of the potentially fatal consequences of not applying for a new tenancy before the current tenancy was terminated, deliberately elected not to apply. The reason for not applying is clearly pleaded in the notice of opposition filed by her former solicitors. Paragraph 5 of the Notice of Opposition asserts that as the respondent was in occupation of the suit premises, or part thereof, prior to 10th June 1983, Part IV does not apply and the suit premises remain subject to Part II. This issue of jurisdiction recently came before the Tribunal in similar circumstances in Chiu Hing Kiang v. William Lee Shung L.T. 4806/89. In that decision the Tribunal held that even where the tenant of the suit premises was before 10th June 1983 merely a sub-tenant of part of the suit premises, they nevertheless remain in Part II.

6. The Tribunal arrived at that conclusion after first holding that the applicant tenant in that case, was not estopped from raising the classification issue, even though he had formally applied for a new tenancy. In the present case the position of the respondent tenant is even stronger. For she has never applied for a new tenancy under Part IV and in her notice of opposition fully pleads her jurisdictional defence that the suit premises se Part II and not Part IV premises.

7. Mr. Chow drew my attention to the fact that the Commissioner had on 24th December 1986, in relation to the current tenancy agreement, endorsed it under Part IV on the prescribed Form CR109. I confirm that it was the applicant's solicitors who prepared and sent Form CR 109 to the Commissioner and it was signed by the applicant and not by the respondent. The respondent subsequently received an endorsed copy of Form CR 109 from her then solicitors and took no further action. The obligation under Section 119L to lodge Form CR 109 with the Commissioner is imposed on the landlord and not upon the tenant. The obligation is limited to those tenancies which are subject to Part IV. However, the Commissioner in terms of Section 119L merely endorses "the fact of receipt" of Form CR 109. He does not certify or endorse that the premises are subject to Part IV nor as a matter of law does any presumption, prima facie or otherwise, arise from the administrative act of endorsement.

8. The only action the respondent took which might possibly have been invoked as giving rise to estoppel, also arose before the applicant commenced the present proceedings. This was the action of the respondent on 26th June 1989, after receiving the applicant's prior Form CR 101, serving the Form CR 102 counter notice on the applicant. I also record that in the present proceedings the applicant has not raised any issue of estoppel at waiver. For the reasons already set out in Chiu Ming Kiang v. William Lee Shung I hold that the present respondent is not estopped from raising her present defence nor at any time has she waived that right.

9. On the instant facts and in accordance with the principles set out in Chiu Ming Kiang v. William Lee Shung I hold that the suit premises remain subject to Part II of the Landlord and Tenant (Consolidation) Ordinance. Accordingly the present application for vacant possession under Part IV must fail. The application is therefore dismissed. There shall be no order as to costs.

Dated this 28th day of March 1990.