SIME DARBY MOTOR SERVICES LTD v. DIRECTOR OF LANDS

CACV 408/2022, [2024] HKCA 459

On Appeal From [2024] HKCA 207

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 408 OF 2022

(ON APPEAL FROM HCAL NO 933 OF 2020)

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J U D G M E N T

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Hon G Lam JA (giving the Judgment of the Court):

1.  In our judgment handed down on 8 March 2024 (“Judgment”),[1] we allowed the Director of Lands’ appeal and dismissed the applicant’s application for judicial review. We held that the Director’s Decision not to conduct an in-situ land exchange with the applicant was not a decision in the public law domain and, as such, not amenable to judicial review. We further held that even if the Decision was judicially reviewable, the substantive grounds for review relied on by the applicant were not made out.

2.  By notice of motion dated 3 April 2024, the applicant seeks leave to appeal to the Court of Final Appeal.  This is our decision on that application based on the parties’ written submissions.  We adopt the definitions used in the Judgment.

3.  The questions said to be of great general or public importance within the meaning of section 22(1)(b) of the Hong Kong Court of Final Appeal Ordinance (Cap 484) are stated in the notice of motion with elaboration and sub-questions.  In essence, they may be broadly summarised as follows:

(1)  Whether a decision made by the Director of Lands pursuant to and/or in implementing a policy not to entertain non-small house land exchange applications within village environs for the preservation of land for small house development by indigenous villagers under the Small House Policy is amenable to judicial review.

(2)  What is the correct approach of the court in determining whether the policy in fact exists.

(3)  Whether the policy is inherently illogical, irrational and perverse.

(4)  What is the evidential threshold for a respondent to satisfy the court that exceptions to the policy do actually exist and there has been proper operation of the exceptions.

(5)  Whether, by virtue of section 13 of the Town Planning Ordinance (Cap 131), a zoning designation in an approved plan constitutes a representation by the Government of its planning intention in respect of land subject to such zoning decision, and whether the Director’s invocation of the policy to preserve the Subject Lots for the building of small houses frustrated the applicant’s legitimate expectation.

4.  On Question 1, the applicant points out that Hang Wah Chong was decided 40 years ago and Anderson Asphalt 15 years ago.  It is submitted that viewed against the intervening developments of the law in common law jurisdictions, the correctness of Hang Wah Chong and the ensuing line of authorities ought to be reconsidered. 

5.  The question whether the Hang Wah Chong line of authorities should be departed from or overruled is of course a question of general importance.  But that line of authority has been affirmed before by the Court of Final Appeal, albeit not directly in the context of amenability to judicial review – see Director of Lands v Yin Shuen Enterprises Ltd (2003) 6 HKCFAR 1; Raider Ltd v Secretary for Justice (2000) 3 HKCFAR 309, 313; Ying Ho Co Ltd v Secretary for Justice (2004) 7 HKCFAR 333, §102; and by the Appeal Committee in a case concerning amenability to judicial review: Rank Profit Industries Ltd v Director of Lands (FAMV 7/2009, 25 June 2009).  In particular, in Rank Profit at §10, Ribeiro PJ said that the proposition advanced by the applicant there “cuts across the principles firmly established by these authorities and is not reasonably arguable”.  

6.  The overseas authorities cited by the applicant seem to us to apply the established approach stated in, for example, Regina (Beer (trading as Hammer Trout Farm)) v Hampshire Farmers’ Markets Ltd [2004] 1 WLR 233 at §16 where Dyson LJ said “the question whether the decision of a body is amenable to judicial review requires a careful consideration of the nature of the power and function that has been exercised to see whether the decision has a sufficient public element, flavour or character to bring it within the purview of public law”.  This was cited in R (Holmcroft Properties Ltd) v KPMG LLP [2020] Bus LR 203 at §47 as an important passage that summarises the jurisprudence on amenability, and was considered in Hong Kong in Anderson Asphalt Ltd v Secretary for Justice [2009] 3 HKLRD 215 (CA) at §§56-57 and in Hong Kong Rifle Association v Hong Kong Shooting Association [2012] 4 HKLRD 411 at §§14-15.  The Privy Council’s decision in The State of Mauritius v The (Mauritius) CT Power Ltd [2019] UKPC 27 cited by the applicant appears to be an application of Mercury Energy Ltd v Electricity Corporation of New Zealand Ltd [1994] 1 WLR 521, a case considered and applied in Hong Kong in Matteograssi SpA v Airport Authority [1998] 2 HKLRD 213.  We do not find there have been any fundamental changes in the principles of public law since Rank Profit and Anderson Asphalt that call for a reconsideration of this settled aspect of Hong Kong law.  In these circumstances we see no reason for this court to give leave to appeal.

7.  In addition, on Question 1, the applicant has made a narrower submission that on the existing state of the authorities, the implementation of the policy in this case (the VE Guideline) was part and parcel of the overall scheme of the Small House Policy, so that this case is indistinguishable from Koon Ping Leung v Director of Lands [2012] 2 HKC 329.  We disagree.  Our analysis of why Koon Ping Leung does not assist the applicant and why the VE Guideline does not render the Decision susceptible to judicial review has been set out in our Judgment at §§54-55 & 57-60 based on established principles and will not be repeated here.  In our view, the contrary is not reasonably arguable.

8.  On the footing that there is no appeal on the issue of amenability, the other questions raised which relate to the substantive grounds for judicial review fall away as being academic.  For completeness, we explain as follows why leave to appeal should also be refused on the merits of these questions.

9.  Question 2 relates to an issue of fact.  The question, as formulated, is directed at a policy “(a) the existence of which was specifically put in issue by the Applicant; (b) that was not documented by any documentary evidence even in the affidavit in opposition filed by the Respondent; (c) was only said to be evidenced by a ‘Technical Circular No 620C’ dated 5 December 1994 issued by a Senior Estate Surveyor and disclosed by the Respondent subsequently; and (d) the relevant and surrounding documents relating to ‘Technical Circular No 620C’ the Respondent had refused to disclose, in breach of its duty of candour”.  These circumstances are self-evidently specific to this case.  What burden is to be imposed on the respondent and what inferences are to be drawn in relation to the existence of a disputed policy are matters that depend on the facts of a particular case.  They do not raise questions of law of general application. In any event, given the evidence referred to in our Judgment at §§35-38, it is in our view not reasonably arguable that the VE Guideline did not exist.

10.  It is submitted on behalf of the applicant that Question 3 focuses on the irrationality of the policy itself.  But the applicant has simply repeated its assertion that the policy may potentially result in land being put to no meaningful and permissible use, without addressing this court’s reasons for rejecting the irrationality argument in our Judgment at §§64-70 or showing why there are reasonable prospects of success in the intended appeal on this point.

11.  Question 4 asks what evidential threshold applies for showing that exceptions to a policy exist and have been properly operated.  We do not think it reasonably arguable that something other than the usual rules of evidence in civil proceedings applies.  The application of those principles may mean that more or less cogent evidence is required based on a given set of facts, but, as we stated in our Judgment at §72, it will be erroneous to elevate the description of the burden in a particular case to a requirement applicable generally.  There is no relevant question of general importance here.

12.  Question 5 seeks to suggest that the zoning in an approved plan constitutes a representation by the Government of its planning intention in its capacity as owner or landlord of land in Hong Kong.  In short, it is submitted by the applicant that there is a representation that the Government would not act in a manner inconsistent with the approved plan, and that this has the effect of restraining the Government’s exercise of powers in its capacity as land owner or landlord.  But the approved plan in the present case has zoned a major part of the Subject Lots as “G/IC” for which “house” is a Column 2 use, so that small houses may be erected there with specific planning permission applied for and obtained from the TPB.  A minor part of the Subject Lots is zoned “R(A)3” for which “house” is a use always permitted.  Further, as stated in our Judgment at §69, the Planning Department will apparently give sympathetic consideration to an application for planning permission for a small house if not less than 50% of its proposed footprint falls within the village environs of a recognised village and there is a general shortage of land for small house development in the “V” zone of the village.  As such, it is not necessarily inconsistent with the approved plan for the Subject Lots to be used for building small houses.  The question put forward is based on a false premise.

13.  For the above reasons, the notice of motion is dismissed.  The applicant shall pay the respondent’s costs, which we summarily assess in the sum claimed of $92,205.