ROSIE GABY v. CHENG MEI LAN

CACV 1005/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 1005 OF 2000

(ON APPEAL FROM LDPD NO. 1544 OF 2000)

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J U D G M E N T

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1. The Applicant is the landlady of a flat in Causeway Bay. The Respondent is her tenant. The rent is $11,500.00 a month payable in advance on the 5th day of each month. The tenant paid the first month's rent due on 5 February 2000, but since then she has fallen into arrears. She claims that the landlady was not around to collect the rent, but it could be said that she should have put aside the rent to enable her to pay it when the landlady re-appeared. Eventually on 21 August, the landlady obtained an order for possession of the flat in the Lands Tribunal. That order was suspended on condition that the tenant paid the following sums to the landlady by 18 September:

(i) the arrears of rent of $69,000.00 which had accrued since 5 March, i.e. six months' arrears from 5 March to 5 August inclusive;

(ii) the rent of $11,500.00 which would have become due by 18 September, i.e. the rent due on 5 September;

(iii) the sum of $1,000.00 fixed costs.

2. By 18 September, the tenant had only paid $34,500.00 towards the arrears of rent. She had therefore not paid the landlady arrears of rent amounting to $34,500.00, nor the rent of $11,500.00 due on 5 September, nor the fixed costs of $1,000.00. The tenant claims that she had reached an agreement with the landlady for the payment of the arrears by instalments, but the landlady denies that. Be that as it may, in view of the tenant's failure to comply with the order of 21 August, a warrant for possession was issued on 22 September.

3. In due course, the tenant applied for the order of 21 August to be set aside and for a stay of execution of the order for possession in the meantime. That application was heard by the Lands Tribunal on 24 October, but since the landlady was not present, it could not be disposed of. The Lands Tribunal made an order which had the effect of preserving the status quo for the time being. It stayed the execution of the order for possession until 20 November (when the tenant's application could properly be heard) on condition that the tenant paid the sum of $11,500.00 into court by 31 October. The tenant paid that sum into court.

4. By the time the tenant's application was heard by the Lands Tribunal on 20 November (and ignoring the agreement which she claimed she had reached with the landlady for the payment of the arrears by instalments which was denied by the landlady), she owed the landlady the sum of $58,500.00:

9 months' rent due from
	5 March to 5 November		$103,500.00
Fixed costs			$1,000.00
			$104,500.00
Less	(a)	arrears of rent paid between 21 August and 18 September		$34,500.00
	(b)	sum paid into court by 31 October		$11,500.00
			$46,000.00	$46,000.00
			$58,500.00

However, the tenant had paid the landlady a security deposit of $23,000.00 when she took the tenancy, and if that was taken into account, the sum owed would be reduced to $35,500.00, i.e. 3 months' rent plus the fixed costs of $1,000.00. At the hearing on 20 November, she offered to pay the current rent as it fell due and a further $11,500.00 towards the arrears. She explained that her business on the Mainland was in trouble and that she simply did not have the time to look for another flat. In the event, the Lands Tribunal dismissed her application to have the order of 21 August set aside, and the landlady is now proposing to execute the order for possession tomorrow.

5. Yesterday, the tenant applied to the Lands Tribunal for a further stay of the execution of the order for possession pending a proposed appeal to the Court of Appeal against the Lands Tribunal's refusal to set aside the order of 21 August. That application was dismissed, and the tenant now "renews" that application to the Court of Appeal. It is to be noted that a further instalment of rent was due yesterday. Thus, ignoring the security deposit currently held by the landlady (which is a security deposit not merely for the payment of rent but for the due observance by the tenant of all the terms of the tenancy agreement), the tenant is now 6 months in arrears of rent.

6. The tenant claims that she received no notice of the originating notice of application to the Lands Tribunal, that she received no notice of the hearing of 21 August, and that she received no notice of the order which had been made on 21 August. However, there is in the court file an affirmation of service relating to the service of the originating notice of application on the tenant, and there is also in the court file a notice of the hearing of 21 August addressed to the tenant.

7. The tenant also claims that since the hearing on 20 November she came to a further agreement with the landlady. By that agreement, she was to pay the current rent at the beginning of each month, and two months' rent towards the arrears of rent in the middle of each month. She claims that a few days ago the landlady went back on that agreement, and insisted that she leave the flat now. The tenant says that, had she known on 20 November that the landlady would not be prepared to let her stay in the flat provided that she paid off the arrears and the current rent, she would have had time since then to find alternative accommodation. Accordingly, the tenant's position today is that she is prepared to give up her tenancy, albeit reluctantly, in a few weeks, i.e. the time which it would take her to find alternative accommodation. For her part, the landlady denies that she came to any agreement with the tenant since 20 November.

8. It is not possible for me to resolve the disputed issues of fact, but in my opinion the tenant's persistent failure to pay the rent, whether as it fell due in accordance with the tenancy agreement or according to the schedule for repayment of the arrears which she claims she agreed with the landlady, justified the order of 20 November and the order which was made yesterday. Nor do I think that it would be right to defer the execution of the order for possession, even for a few weeks, to enable the tenant to find alternative accommodation in the meantime. If I did that, the landlady would not get another appointment with the bailiffs until some time after the tenant would otherwise have been required to leave the flat. Moreover, if I had stayed the execution of the order for possession for a few weeks, I would have only done so on condition that the tenant pays the current rent and a substantial sum towards the arrears within a few days. That would have been disadvantageous to the tenant because she would need those funds for her initial rent and security deposit for any new flat.

9. In these circumstance, there is, I believe, no chance of the tenant persuading the Court of Appeal that the Lands Tribunal was wrong to make the order of 21 August, or to refuse to set aside the order of 21 August, or to give her further time to pay the arrears, or to suspend the execution of the order for possession. Since her appeal is so unlikely to succeed, it would be wrong for me to stay the execution of the order for possession today. In any event, an appeal to the Lands Tribunal to the Court of Appeal lies only on a point of law: see section 11(2) of the Lands Tribunal Ordinance (Cap. 17). No question of law arises in this case, save that I accept that if it is being said that the Lands Tribunal exercised its discretion in an irrational manner, the Lands Tribunal could be said to have erred in law, in which case a point of law would have been raised.

10. Accordingly, this application for a stay of the execution of the order for possession must be dismissed.