BUILDING AUTHORITY v. APPEAL TRIBUNAL (BUILDINGS)

CACV 19/2012 AND CACV 113/2012

CACV 19/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 19 OF 2012

(ON APPEAL FROM HCAL NO. 20 OF 2011)

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BETWEEN

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CACV 113/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 113 OF 2012

(ON APPEAL FROM BUILDING APPEAL CASES NOS. 29-2011, 392-2011
AND 431-2011 BY WAY OF CASE STATED PURSUANT TO
SECTION 53C(1) OF THE BUILDINGS ORDINANCE, CAP. 123)

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BETWEEN

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REASONS FOR DECISION

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Introduction

1.  There were three applications before me relating to two appeals.  The first appeal (the Dobrowen Appeal) is CACV 19/2012 between three parties whom I shall refer to as the Interested Parties (as appellant) and the Building Authority, which is due to be heard by the Court of Appeal on 10 April 2013 (with 11 April 2013 reserved).  The second appeal (the Case Stated Appeal) is CACV 113/2012 between a party whom I shall refer to as the Case Stated Appellant (as appellant) and the Building Authority, which is due to be heard by the Court of Appeal on 19 June 2013.

2.  The first application was by the Interested Parties in the Dobrowen Appeal for that appeal to be heard together with the Case Stated Appeal on 10 April 2013.  The second application was by the Case Stated Appellant for the Case Stated Appeal to be heard together with the Dobrowen Appeal.  For reasons that I will explain, these two applications fell away in the course of the hearing and I made no order on the applications save that the costs of the summonses be in the cause of the appeal.

3.  The third application – consisting of an application in each appeal – was by the Real Estate Developers Association of Hong Kong (REDA) for leave to be joined as a party in both appeals.  At the conclusion of the hearing, I dismissed those applications and indicated I would hand down my reasons for doing so, which I now do.

The application that the appeals be heard together

4.  The basis of the first two applications was that the same questions of law arise in both appeals so that it would be convenient and cost-effective for both appeals to be heard at the same time.  It would also avoid the risk of inconsistent or contradictory judgments by two different divisions of the Court of Appeal.

5.  It was clear that much of the force of the Interested Parties’ submissions lay in the concern that two separate appeals might result in inconsistent or contradictory decisions by two different divisions of the Court of Appeal.  However, that risk would diminish if the same three judges hearing the Dobrowen Appeal in April also hear the Case Stated Appeal in June.  The Clerk of Appeals has now been able to list the two appeals to be heard by the same bench of three judges.  The risk would then disappear altogether if the Court of Appeal were to delay giving judgment in the Dobrowen Appeal until after hearing the Case Stated Appeal and to give judgment in both appeals at the same time.

6.  On that footing, when I indicated the listing arrangement that has been put in place, Mr Anthony Ismail, counsel for the Interested Parties and Case Stated Appellant, was content not to pursue the applications for the two appeals to be heard together.  Accordingly, I made no order on the applications.  As to costs, Mr Nicholas Cooney SC, counsel for the Building Authority, did not oppose Mr Ismail’s application that they be costs in the cause of the appeals and I so ordered.

The application by REDA to be joined as an interested party in both appeals

7.  The basis of the third application was that REDA is an applicant in a pending judicial review, namely HCAL 95/2011 (the REDA judicial review), against the Building Authority challenging the latter’s policy of requiring applicants submitting general building plans to provide proof of ownership or a realistic prospect of control over the land in respect of which approval is sought.  It was said to raise the same proof ownership or control issue as in the two appeals and so a question of law that is common to the two appeals.  Leave to apply for judicial review has been granted but the substantive application is not expected to be ready for hearing until later this year.

8.  REDA is an association of persons engaged in the real estate development business in Hong Kong and it is said, and there is no dispute, that most if not all of REDA’s members are directly affected by the policy under challenge.

9.  In support of the jurisdiction of the court to join an additional party to proceedings, REDA relied on O.15 r.6(2)(b), O.59 r.10 and the inherent jurisdiction of the court.  REDA contended that the second limb of O.15 r.6(2)(b) is satisfied in the present case since the object of the rule is to:

“… ensure that all relevant matters in dispute in the action can be effectively adjudicated upon by the court and that all relevant parties are before it”.

See, Wing Mou Construction v Cosmic Insurance, unrep., HCCT 40/2001, 20.6.02 per Ma J (as he then was) at §15(2).  REDA submitted that it is a relevant party for the purposes of joinder under O.15 r.6(2)(b).

10.  Hence, it was submitted by Mr Michael Thomas SC, leading counsel for REDA, that it lay within the court’s discretion whether to allow or refuse the joinder taking into account factors such as prejudice to the existing parties and the stage of the action: see Wing Mou Construction at §15(5).

11.  In this regard, REDA relied on the fact that the legality of the policy under challenge in the judicial review proceedings is also a common issue of law in the Dobrowen Appeal and the Case Stated Appeal.  It was submitted that it would be just and convenient for the legality of the policy to be determined between the Building Authority, the Interested Parties, the Case Stated Appellant and REDA at the same time.  It was also stressed that the legality of the policy is an important issue in the context of development in Hong Kong and that it would serve the interests of justice for REDA to be heard on that question by this Court.  Furthermore, since the avoidance of multiplicity of proceedings is a key objective of O.15 r.6(2)(b), making REDA a party to the appeals would achieve that objective since REDA and the Building Authority would be bound by the issue common to the appeals and the REDA judicial review.  It was submitted that no prejudice would be caused to any party in the Dobrowen Appeal or the Case Stated Appeal if REDA were permitted to intervene, since REDA does not propose to file any factual material and proposes only make legal submissions regarding the policy under challenge.

12.  There was a dispute as to whether the proof of ownership or control issue is common to all three of the Dobrowen Appeal, the Case Stated Appeal and the REDA judicial review.  Mr Cooney pointed out that there are differences between the factual contexts in which the so-called proof of ownership and control issue arise in the Dobrowen Appeal and the Case Stated Appeal.  However, it seemed to be accepted that the proof of ownership and control issue raised in the Case Stated Appeal raises the same questions of law as are raised in the REDA judicial review although it was suggested there may be other factual issues in the latter which go beyond the issues in the Case Stated Appeal.

13.  However, I do not think REDA comes within the second limb of O.15 r.6(2)(b) because in neither the Dobrowen Appeal nor the Case Stated Appeal is there a question or issue arising out of or relating to or connected with any relief or remedy claimed in the cause or matter which concerns REDA.  I agree with Mr Cooney’s submission that the relief or remedy claimed in both the Dobrowen Appeal and the Case Stated Appeal is personal to the applicants in those appeals and does not concern REDA.  Each is concerned with decisions made by the Building Authority in respect of their own particular proposed developments and the issues in both cases would appear to go beyond the questions of law raised.

14.  As stated in Hong Kong Civil Procedure 2013 (Vol. 1) at Note 15/6/7 citing Spelling Goldberg Productions Inc v BPC Publishing Ltd [1981] RPC 280:

“The rule is not wide enough to permit joinder of a party who is merely interested in the case so far as it determines a question of law. The words in the rule ‘may exist a question or issue’ relate to an existing question or issue between the existing parties …”.

15.  See, also, Shanghai Land Holdings Ltd (in receivership) v Chau Ching Ngai [2005] 3 HKC 302 at §§14-15 for the proposition that O.15 r.6(2)(b)(ii) requires some interest in the would-be intervener which is in some way directly related to the subject matter of the action and that a mere commercial interest in the outcome, divorced from the subject matter of the action, is not enough.

16.  Mr Thomas submitted that REDA’s interest is not merely commercial and that its interest is in the outcome of the REDA judicial review which would be directly affected by the outcome of the Dobrowen Appeal and Case Stated Appeal.  I do not think this is sufficient to bring REDA within O.15 r.6(2)(b) and it seems to me that REDA’s interest is merely an interest in the outcome of the appeals insofar as they will determine a question of law. The fact that that question of law may be directly relevant to the outcome of the REDA judicial review does not, in my view, give REDA a sufficient interest for the purposes of O.15 r.6(2)(b).

17.  Although there are dicta in the authorities to the effect that O.15 r.6(2)(b)(ii) confers a wider jurisdiction than O.15 r.6(2)(b)(i) (which requires the joinder to be “necessary”), none of the cases cited by Mr Thomas went so far as to permit joinder under O.15 r.6(2)(b)(ii) of a party such as REDA having only an interest in a question of law common to pending litigation in which it is involved.

18.  That conclusion means that there is no discretion to exercise under O.15 r.6(2).  However, since REDA relied also on O.59 r.10 and the inherent jurisdiction of the court in support of the joinder application, I shall therefore state my views on the other arguments going to the exercise of discretion.

19.  I also address the matters going to discretion in case I am wrong in my conclusion on O.15 r.6(2)(b), since even if REDA is within the second limb of the rule, joinder should only be ordered if the Court is of the opinion that it would be “just and convenient” to do so.

20.  It is, in my view, a weighty factor against joinder that the Interested Parties in the Dobrowen Appeal and the Case Stated Appellant are represented by leading and junior counsel and solicitors.  There is no suggestion that their legal representation will not be thorough and that all relevant arguments on the issues in the two appeals will be advanced.

21.  Further, I was informed that the Interested Parties in the Dobrowen Appeal and the Case Stated Appellant are all members of REDA.  In that case, they can consult REDA in relation to the appeals and there is nothing to stop REDA’s legal advisers offering them such informal assistance as they wish in the background to ensure that nothing is left unsaid that might be relevant.

22.  It is also relevant that REDA is applying to join the Dobrowen Appeal, which is an appeal from a judicial review, without having previously sought to appear in the underlying judicial review as an interested party.  Since there is a recognised procedure under O.53 for applications by interested parties to be heard, which requires such an application to be made “promptly” (see O.53 r.5B), it would be an exceptional course for the Court of Appeal to permit joinder in that appeal at this late stage.

23.  Although the preceding point does not apply to the Case Stated Appeal, in that there was no procedure for REDA to join in the appeal before the Buildings Appeal Tribunal giving rise to the Case Stated Appeal, it is still an unusual course to permit a party that did not appear at a first instance hearing to join in the proceedings at the appeal stage.

24.  The argument that it would be convenient for REDA to be joined because it would then be bound by the decision of the court does not, in my view, carry significant weight since the principle of stare decisis in relation to a question of law applies regardless of whether a party is joined or not.  Furthermore, it is not entirely clear at this stage to what extent a decision on the Case Stated Appeal would completely avoid the need to hear the REDA judicial review.  Nor is it clear to what extent a judgment binding on REDA would preclude other developers bringing fresh proceedings challenging an adverse decision and seeking to distinguish any appellate judgment there might eventually be on the legality of the proof of ownership and control issue.

25.  I do not think that the absence of prejudice to any party in the Dobrowen Appeal or the Case Stated Appeal if REDA were permitted to intervene is a strong reason for permitting joinder where the principles for joinder under O.15 r.6(2) are not otherwise satisfied.  Were it otherwise, it is difficult to see how any developer might not say it was also entitled to be joined to any case involving the Building Authority which affected the industry as a whole.

26.  I think that there is substance in the complaint that there has been apparent delay in REDA’s application and that there is an absence of any explanation for that delay.  Leave to apply for judicial review was obtained in November 2011 and the proceedings have apparently been dormant since March 2012.  REDA only approached the Building Authority to join the appeals on 7 February 2013.  The two appeals were fixed (in May 2012 and July 2012 respectively) on the basis of the time estimates of the parties to those appeals without reference to REDA.  REDA’s joinder would necessarily put those estimates at risk which could give rise to prejudice to the existing parties to the appeals.

27.  Finally, I would note that reference was also made to the Court of Appeal’s powers under O.59 r.8.  However, Hong Kong Civil Procedure 2013 (at Note 59/8/1) indicates that for a party to be joined to an appeal under that rule, he must have a legal interest in the proceedings and the authorities cited include Spelling Goldberg Productions Inc v BPC Publishing Ltd(supra). I do not therefore think that reliance on O.59 r.8 adds anything to REDA’s application.

28.  For all these reasons, in the exercise of my discretion, I dismissed REDA’s summonses to join the two appeals.

29.  It was not disputed that costs of those summonses should follow the event and I so ordered.