HUI CHUNG YAU v. HUI HUNG KIM Alias LU HAI

DCCJ 3075/2014

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO.3075 OF 2014

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DECISION

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Introduction

1.  This is plaintiff’s summons filed 19 Aug 2016 for judgment against defendant in default of defence under O.19 r.7 of the Rules of District Court, Cap.336H (“RDC”).

2.  Plaintiff and defendant are registered co-owners each holding half share of the property known as 2^nd floor, 41 Kai Ming Street, Kowloon (“the property”) as tenants-in-common.

3.  By this action, plaintiff asserts that he and his predecessor in title has been in adverse possession of the property for a continuous period exceeding 20 years prior to the action.

4.  As such, it is asserted that defendant’s legal and beneficial interests of and in the property has been extinguished under and by virtue of s.17 of Limitation Ordinance, Cap.347 (“LO”), and plaintiff has acquired an indefeasible possessory title to the property.

5.  Plaintiff therefore seeks 2 declarations from this court to the above effect in this application.

Procedural history

6.  On 11 Aug 2014, the writ of summons indorsed with statement of claim (“SOC”)[1] was issued against defendant with the property as his last known address. Save for subject 2 declarations and costs, the prayer of SOC makes no other claims

7.  On 5 Feb 2016, after reading, inter alia, 4 affirmations of plaintiff, Master Lam ordered[2] substituted service of the renewed writ[3] to be effected by advertising a Chinese notice of these proceedings on 3 consecutive days in a Chinese newspaper published and circulating in Hong Kong and ordered the time for acknowledgment of service (“AS”) shall be 14 days after the last day of publication.

8.  For the 3 consecutive dates of 14 to 16 Mar 2016, a Chinese notice of these proceedings was published in a Chinese newspaper circulating in Hong Kong[4] but no AS was received within the prescribed time or at all.

9.  On 15 Aug 2016, Master Ho ordered[5] substituted service of plaintiff’s summons to be effected by causing a statement to be published in a Chinese newspaper circulating in Hong Kong.

10.  On 8 Sept 2016, a statement of plaintiff’s summons was published in a Chinese newspaper circulating in Hong Kong[6].

11.  On the return date of plaintiff’s summons, plaintiff appeared with solicitors and counsel. Defendant did not appear and no defence was filed so far.

12.  Upon satisfied that service of renewed writ and of plaintiff’s summons was deemed to have been effected as aforesaid, I proceeded to hear plaintiff’s summons in defendant’s absence.

Applicable law

13.  No action shall be brought to recover any land after the expiration of 12 years[7] from the date on which the right of action accrued to him, or if it first accrued to some person through whom he claims, to that person: s.7(2) of LO.

14.  Where the person bringing an action to recover land, or some person through whom he claims, has been in possession thereof, and has while entitled thereto been dispossessed or discontinued his possession, the right of action shall be deemed to have accrued on the date of the dispossession or discontinuance: s.8(1) of LO.

15.  No right of action to recover land shall be deemed to accrue unless the land is in the possession of some person in whose favour the period of limitation can run (referred to as adverse possession) and where any such right of action is deemed to accrue on a certain date and no person is in adverse possession on that date, the right of action shall not be deemed to accrue unless and until adverse possession is taken of the land: s.13(1) of LO.

16.  At the expiration of the period prescribed by LO for any person to bring an action to recover land, the title of that person to the land shall be extinguished: s.17 of LO.

17.  A person claiming to be in adverse possession must be shown to have both possession and the requisite intention to possess. The question of intention to possess, as with any other question of intention, is one of fact. Whether it can be established depends on an assessment of all the circumstances in a particular case: Wong Tak Yue v Kung Kwok Wai & Another (No.2) (1997-98) 1 HKCFAR 55, 68E, 68H-69A.

18.  Co-owners enjoy unity of possession, which enable each of the co-owners to occupy the whole of the co-owned property: 曹美如訴龔梅芳, unreported, HCMP 2026/2000, 28 Feb 2003, Lam J. (as he then was), para.20, 25 & 26. For co-owners, there has to be ouster before the possession of one co-owner could be treated as adverse: Lai Wai Kuen v Wong Shau Kwong, unreported, HCA 3434/2003, 12 Nov 2004, Lam J. (as he then was), para.7.

19.  Under O.19 r.7, RDC, the court cannot receive any evidence, but must give judgment according to the pleading alone. The statement of claim must, on the summons, show a case for the order the applicant seeks to obtain: Hong Kong Civil Procedure 2016, Vol.1, para 19/7/11 & 19/7/14 at p.472.

20.  Although para(1) of O.19 r.7, RDC, is expressed in mandatory terms, the rule is not mandatory but discretionary, and the court retains its discretionary power whether to grant judgment or not: Hong Kong Civil Procedure 2016, Vol.1, para 19/7/13 at p.472.

21.  It is not the practice of the court to make a declaration of right in default of defence. Where such relief is to be granted without trial or evidence, the right course for the court is not to make a declaration but to state on what footing the relief is to be granted. It is, however, not a rule of law and will give way to the paramount duty of the court to do the fullest justice to the plaintiff to which he is entitled. Such rule of practice will not be followed where the plaintiff had a genuine need for declaratory relief and justice would not be done if such relief were denied: Hong Kong Civil Procedure 2016, Vol.1, para 19/7/14 & 19/7/20 at pp.472-473.

Pleaded case

22.  It is pleaded at para 2 to 4 of SOC that, by an assignment in 1958, plaintiff’s paternal grandfather was vested sole ownership of the property. By an assignment in 1972[8] (“the 1972 assignment”), the said grandfather assigned the property to plaintiff’s mother and defendant to hold as tenants-in-common with half share each. By an assignment in 2002[9] (“the 2002 assignment”), plaintiff’s mother assigned her half share in the property by way of gift to plaintiff.

23.  It is further pleaded at para 5 of SOC that since the 1972 and 2002 assignments, plaintiff’s mother took possession of the property and carried out renovation and decoration at her own expenses, caused the door lock changed at her own costs and did not give the key to defendant, occupied and used the property with plaintiff to the exclusion of defendant, did not pay rent or profit to defendant for their exclusive occupation of the property.

24.  At all the material times, defendant, it is also pleaded, did not occupy or have access to the property, did not make any such request to plaintiff or his mother, and did not make any demand for account, rent or profit from plaintiff or his mother.

25.  At all material times, plaintiff and his mother, it is further pleaded, spent money on maintaining or repairing the property, paying government rent and rates, and paying all stamp duty, outgoings, charges and overhead of the property, which costs and expenses defendant never paid or contributed at all.

26.  The important pleas at para 7 & 9 of SOC are that, since the 1972 assignment, plaintiff’s mother with plaintiff had been exclusive possession of the property for a continuous period of not less than 20 years prior to the 2002 assignment. And since the 2002 assignment, plaintiff (together with his mother) has been in exclusive possession of the property for a continuous period of not less than 12 years prior to the commencement of this action.

27.  By the 2002 assignment, it is pleaded at para 8 & 10 of SOC, plaintiff’s mother, as predecessor-in-title of plaintiff, has been in adverse possession of defendant’s interest in the property. By the commencement of this action, plaintiff has been in adverse possession of defendant’s interest in the property.

28.  The SOC ends with the plea at para 11 & 12 that plaintiff’s possession of defendant’s interest in the property is continuous to that of his predecessor in title, namely, his mother. And plaintiff is still in exclusive possession of the property.

Analysis

Case proven on pleading

29.  Looking at SOC alone, it is, I notice, not pleaded that defendant had been dispossessed from the property by plaintiff’s mother, plaintiff or any other persons through whom they claim, or that defendant had discontinued his possession of the property on his own at any point in time.

30.  Rather, it appears from SOC that plaintiff’s mother took possession of the property as from the 1972 assignment and that defendant never so took possession. Thereafter, plaintiff’s mother and plaintiff occupied the whole of the property without accounting to defendant (e.g. rent) and they wholly paid for their enjoyment of the property (e.g. rates) with no contribution from defendant until the commencement of this action.

31.  However, the above pleaded facts could signify, I think, no more than plaintiff’s mother, and plaintiff in turn, exercising their unity of possession as one co-owner of the property is entitled to enjoy, with defendant electing not to so enjoy. Absent ouster, that by no means, I think, proves that their possession of the whole of the property co-owned was adverse to the other co-owner i.e. defendant.

32.  It must be pointed out it is nowhere pleaded that defendant had demanded access to, or occupation of, the property, or demanded rental from plaintiff and/or his mother for their occupation but was met with denial or refusal from any or both of them in words or in actions. Despite plaintiff’s mother caused to be changed the door lock of the property and did not give the key to defendant, it was nowhere pleaded that defendant had demanded such key.

33.  The facts as founded after trial in the case of Cheung Pak Cheong & Another v Tong Keng, unreported, DCMP 1706/2012, 31 Dec 2012, cited by plaintiff’s counsel make out, I think, a stronger case for adverse possession in that there was interaction and dialogue between the paper owner and squatter there as compared with none pleaded in the case before me. Ouster was not considered in that judgment despite 2^nd plaintiff was co-owner of the suit property with defendant. But one would have thought the trial judge would have no difficulty finding ouster on the facts found after trial if the matter was considered

34.  Ouster was considered by Lam J. (as he then was) in Lai Wai Kuen v Wong Shau Kwong, supra and his lordship was minded to grant declarations of possessory title in default of defence. The other co-owner there never occupied the suit property and had never demanded any rent or account from plaintiff’s predecessor or plaintiff.

35.  Despite the circumstances under which defendant ceased to have dealings with the suit property was very flimsy, Lam J (as he then was), relying on the case of Doe d Fishar & Taylor v Prosser (1774) 1 Cowp 217, presumed ouster from the very long period (from 1950’s to 2004) during which defendant did not have any occupation or access to the suit property, did not make any demand for account, and there had been no payment of rent or profits throughout the years.

36.  Taking plaintiff’s pleaded case as it stands with accrual of action as from the 1972 assignment when his mother started to take possession of the property, he and his predecessor had 42 years of uninterrupted possession of the property until 2014 without any account to or demand from, or claim set up by defendant co-owner. I find it indistinguishable from Doe d Fishar & Taylor v Prosser, supra, where the possession lasted 36 years and ouster was presumed from it. I will also so presume on plaintiff’s pleaded case despite such observations I made in paragraphs 29 to 32 above.

37.  As such, plaintiff and his predecessor in title have, on the SOC, been in adverse possession of the property for a continuous period exceeding 20 years prior to this action and defendant’s title of the property shall be extinguished under s.17 of LO.

Exercise of discretion

38.  Granted that plaintiff’s SOC shows a case for the declaratory orders he seeks to obtain, should I exercise my discretion to grant the 2 declarations in default of defence?

39.  I must say this aspect of plaintiff’s summons troubles me a great deal. While recognizing it is a rule of practice not to do so, I have asked myself if there is any reason I should do so in this case so as to provide the fullest justice plaintiff is entitled to.

40.  Lam J. (as he then was) was, I note, satisfied in Lai Wai Kuen v Wong Shau Kwong, supra, that the plaintiff has a genuine need for the declaratory relief she sought. But the circumstances of that case are that plaintiff was given reply by District Land Office that either consent from co-owner or court declaration about extinction of co-owner’s title was required to go about rebuilding an old and dilapidated house on the suit property.

41.  On my enquiry about any genuine need for plaintiff to obtain the 2 declarations he seeks, plaintiff’s counsel frankly disclosed that plaintiff no longer resides at the property. Unlike his previous 3 affirmations for substituted service where the property was given as plaintiff’s address, an address in To Kwa Wan was given as plaintiff’s address in his 4^th affirmation dated 10 Nov 2015[10].

42.  Moreover, looking at land search of the property at exhibit “HCY-2” to plaintiff’s 1^st affirmation, plaintiff had entered an agreement to sell his half share of the property to Urban Renewal Authority (“URA”) on 9 Apr 2014 for $1,604,500[11]. Plaintiff’s counsel also acknowledged it to be the case when this court referred to it.

43.  Having taken instructions, counsel explained to me that such consideration payable under URA’s assessment rules to plaintiff would be much reduced (and plaintiff cannot afford with such reduced sum to buy another property in the vicinity with equivalent size to that of the property) if he can only sell half share of the property as one of its co-owners. And plaintiff cannot afford to pay for a full-blown trial to prove his case as legal aid is out of his reach.

44.  Having carefully considered the above matters and such explanation from counsel, I am satisfied that plaintiff has a genuine need for declaratory relief and justice would not be done if such relief were denied to him for this reason.

45.  Nevertheless, that is not the end of the matter.

46.  The contents of plaintiff’s 1^st and 2^nd affirmations applying for substituted service, I must say, cast serious doubt on his pleaded case in SOC.

47.  In his 1^st affirmation dated 4 Dec 2014, plaintiff said at para.7 that he was told by his mother that defendant is his paternal uncle i.e. the elder brother of his father. He went on to repeat his pleaded case in SOC. At para.15, he said “in all these years when I was occupying and using the property with my mother, I have never seen the defendant nor had he ever attended the property for any purpose… I had asked my mother if she knew the whereabouts of the defendant and she answered me that she did not know (italics supplied)”[12].

48.  At para.16, plaintiff explained that the last known address of defendant was that stated in the 1972 assignment, namely, the property (it was put down at p.1 thereof[13] as the common address of plaintiff’s paternal grandfather, plaintiff’s mother and defendant[14]). Since defendant “had never stayed” in the property, plaintiff said it would be pointless to serve legal documents at the property[15].

49.  However, in answer to court’s requisitions, at para. 2 & 3 of his 2^nd affirmation dated 13 May 2015, plaintiff said: “As far as I understand, the defendant has never had any permanent residence in Hong Kong. In para.16 of my 1^st affirmation, I mentioned that defendant had never stayed in the property. I was in fact meant that the defendant had never stayed in the property constantly. As far as I can recall, the defendant had only stayed in the property for few days in several occasions. Since the last known address of defendant is in Hong Kong, it is thought that the defendant is still within the jurisdiction of Hong Kong. According to my best recollection, I have had no personal contacts with the defendant since 1983 (italics supplied)”[16].

50.  Apparent material change of stance of plaintiff between his 1^st and 2^nd affirmation and variance of the contents of his 2^nd affirmation with the facts pleaded in SOC, which were verified by plaintiff by statement of truth on 11 Aug 2014[17], are, I think, self-evident. I can only say that these paragraphs of his 1^st and 2^nd affirmations provoked more questions than answered them.

51.  While plaintiff said on oath he had no personal contacts with defendant since 1983, one begs to ask under what circumstances plaintiff had his personal contacts with defendant before 1983, including on those several occasions defendant had only stayedin the property for a few days and what effect, if any, such contacts with defendant had on the possession of the property by plaintiff and his mother, and their intentions thereof, over the years.

52.  Despite that plaintiff has a genuine need for the declaratory relief he seeks, having given careful thought to such contents above of plaintiff’s affirmations against all the circumstances of the case, in exercising my discretion under O.19 r.7 RDC, I have decided that I should follow, and heed the wisdom of, the long-standing practice of not giving declaratory relief without trial in the case before me.

53.  As Millet J. (as he then was) said at Patten v Burke Publishing Ltd. [1991] 1 WLR 541, 544A, “… in the absence of a judgment reached after hearing evidence, a declaration can be based on unproved allegations. The court ought not to declare as fact that which might not have been proved to be such had the facts been investigated”. These words were followed locally by Fok J. (as he then was) in Top One International (China) Property Group Co Ltd v Top One Property Group Ltd [2011] 1 HKLRD 606, para.83.

54.  Fok J. (as he then was) further said at para.85 of Top One International (China) Property Group Co Ltd v Top One Property Group Ltd, supra, “This does not, of course, mean that the plaintiffs cannot obtain the declarations,it merely means that they will have to prove their entitlement to them after adducing evidence in the usual way.”

55.  For the above reason, I decline to grant the declaratory relief plaintiff seeks by his summons.

Disposition

56.  I therefore dismiss plaintiff’s summons with no order as to costs.

57.  Finally, it remains for me to thank plaintiff’s counsel for his assistance.