WISDOM GLORY LTD v. SALECHOICE PROPERTIES LTD

HCAL 640/2024

[2025] HKCFI 2095

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST NO 640 OF 2024

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JUDGMENT

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A.  Introduction

1.  By their Form 86, the Applicants seek leave to challenge the decision (“Decision”) of the Rural and New Town Planning Committee (“RNTPC”) of the Town Planning Board (“TPB”) rejecting the Applicants’ application to rezone a tract of land (“Site”) in Sai Kung.

2.  In 2020, the Applicants had lodged an application (“2020 Application”) under section 12A of the Town Planning Ordinance Cap 131 (“TPO”) to rezone a larger piece of land than the Site from a “Village Type Development” (“V”) to a “Residential (Group B) 6” (“R(B)6”) type zone. This was to facilitate a proposed residential development (“Proposed Development”). The RNTPC/TPB rejected the 2020 Application reasons including that rezoning would result in insufficient land to meet future demand for village small houses (“Small Houses”).

3.  The Applicants re-applied in 2023 (“Application”) with a modified proposal. This time, amongst other things, the proposed area of development was reduced to the Site with a view to reserve more land for future Small House development. Despite this, the RNTPC/TPB rejected the Application, because it still held the view that the reserved land was insufficient to meet future demand. This is the impugned Decision.

4.  The Applicants’ Form 86 dated 23 April 2024 was supported by the affirmation of Ms Yeung Wing Shan Theresa (“Ms Yeung”), the director of Arup Hong Kong Limited (“Arup”), a consultancy firm authorised by the Applicants to represent their interests in re-zoning the Site and in this leave application. On 12 June 2024, the TPB then filed its evidence in opposition, by the affirmation of Mr Yip Chi Kwai (“Mr Yip”), who was the Deputy Director of Planning/Territorial of the Planning Department (“PlanD”). Ms Yeung filed her second affirmation in reply on 8 July 2024.

5.  I ordered a rolled-up hearing of the application for leave and the substantive application. At the hearing, the Applicants were represented by Mr Edward Chan SC, leading Mr Lee Yee Hung and Mr Eric Chim of Counsel, whilst the TPB was represented by Mr Jin Pao SC, leading Mr Harrison Miao of Counsel.

6.  At the end of the hearing, I reserved my decision. This is my Judgment.

B.  Factual Narrative

7.  The Site is situated in Sha Ha Village (“Sha Ha”), slightly over half a kilometre north of Sai Kung Town. It is about 12,689m² – including 1,995m² of government land – and is roughly pentagonal in shape. The Site also adjoins more land to its north-eastern side. This land is partly owned by the Applicants, with the remainder occupied by 6 Small Houses owned by third parties. It is that portion owned by the Applicants that is relevant to this case (“Adjoining Land”). The Site and the Adjoining Land predominantly fall within the village environs (“VE”) of Sha Ha and the largest “V” zone in Sha Ha (the Site alone accounted for 89% of all “V” zones, equivalent to around 50 Small Houses). The other two “V” zones are located immediately north and farther northeast outside of the Site and Adjoining Land.

8.  The Site has been left vacant for over 30 years and has been employed for temporary uses such as a car-parking space, and in recent years has also been occupied by temporary structures.

9.  The Applicants are the registered and current owners of a significant portion of the Site. Together they own 10,559m² (83.2%) of the Site. Another party owns some 135m² (1.1%) of the Site. The remaining 1,995m² (15.7%) of the Site, is made up of two pieces of Government land – one in the middle of the Site, the other in its southernmost corner.

10.  Both the Site and the Adjoining Land were first zoned “Residential (Group 3)” in the Sai Kung Town Outline Development Plan No. D/SK-T/1 for low-rise residential development back in the 1980s. They were later rezoned to “V” on the Sai Kung North Planning Area 4 Layout Plan No. L/SK-T4/1 on 9 February 1999, so as to meet the needs for potential future expansion of Sha Ha and possible relocation of houses which might become affected by governmental projects.

11.  The Site and the Adjoining Land were again marked as V-zone in the Sai Kung Town Outline Zoning Plan No. S/SK-SKT/4, which was approved by the Chief Executive in Council on 19 December 2006. The most recent amended version was approved on 4 June 2013 and was subsequently renumbered as S/SK-SKT/6 (“OZP”).

12.  The objective of the OZP is to indicate broad land-use zones and major transport networks for the area of Sai Kung Town, so that development or redevelopment within the area may be put under statutory planning control. It forms a broad planning framework for preparing more detailed non-statutory plans that provide the basis for public works planning and site reservations for various types of uses.

13.  One such use, or zone, is a “V” zone. The primary intention of this type of zone is for the development of Small Houses by indigenous villagers of a recognised village. Other important planning intentions include to reflect existing recognised or other villages, to provide land considered suitable for village expansion and the provision of village houses affected by government projects, and for the concentration of village type development for an orderly pattern of development, efficient land use and the provisioning of infrastructure and services. “V” zones are drawn up having regard to the existing environs of recognised villages (i.e. “VE”), outstanding Small House demand and other site constraints. An incremental approach is also adopted by first confining a “V” zone to an existing village cluster and then expanding outwards upon due consideration of relevant planning matters.

14.  Small Houses, are of course, a reference to the type of housing which indigenous New Territories inhabitants – who are of 18 years of age, are male, and descended from the male line of a resident of a recognised village in 1898 – are entitled to, by way of grant for once in their lifetime (“Ding”). This has been a government policy since 1972 (“SH Policy”).

15.  The Applicants sought to capitalise upon the developmental potential of the Site and the Adjoining Land by attempting to rezone both from “V” to “R(B)6”. Although the Applicants intimated in their written submissions that they would not rely upon the 2020 Application, it is helpful to give a brief outline about it in order properly to understand what led to the Decision.

16.  On 30 December 2020, the TPB received the 2020 Application. As mentioned above, it was made under section 12A of the TPO in respect of a development site area of 13,230m². This area included the Site and the Adjoining Land owned by the Applicants. This application would reduce the “V” zones for Sha Ha by 93%, leaving available land for an equivalent of four Small Houses, according to the PlanD’s method of estimation.

17.  The 2020 Application specifically proposed to amend the OZP by setting the maximum plot ratio at 1.3, maximum site coverage at 40%, and maximum building height at 7 storeys (excluding basements). It also proposed, amongst other things, to build a public vehicle park with 35 parking spaces at the Site. The residential development was for 24 3-storey detached/semi-detached houses, two 7-storey residential towers (excluding a one-storey basement), and one non-domestic block for clubhouse purposes. The entire development would be accessible from Sha Ha Road to the south. Other aspects of the proposal cover environmental initiatives such as planting greenery, building green roofs and tree compensation, as well as preservation of Neolithic, Bronze Age, Ming and Qing archaeological remains.

18.  An abundance of technical assessments were commissioned by the Applicants and submitted toward the 2020 Application. As might be expected, they encompassed tree preservation and landscaping, traffic, sewerage, drainage, noise, air quality, water supply, visual, and archaeological assessments.

19.  The RNTPC rejected the 2020 Application. Chief amongst its concerns was whether the planning intention of the “V” zone containing both the Site and Adjoining Land, which was to provide suitable land for village expansion and Small House development by indigenous villagers, was still valid. In particular, it was thought that:

(1)  even if the Applicants owned the Site and the Adjoining Land, change of ownership may still occur in the future and could not be ruled out;

(2)  although the Indigenous Inhabitant Representative of Sha Ha (“IIR”) confirmed that its villagers had no intention to build Small Houses within the “V” zone, the representative might not necessarily represent the views of all of the villagers;

(3)  the villagers may still apply for Small Houses in the future.;

(4)  rezoning would result in insufficient land within the remaining “V” zone to meet the potential demand for Small Houses by local villagers as well as to cater for future expansion of Sha Ha; and

(5)  rezoning would also increase the risk of villagers applying for Small Houses in other areas not zoned as “V”, such as “Green Belt” zones.

20.  In the minutes of the RNTPC’s 694^th meeting held on 6 May 2022, the RNTPC explained in summary:

The application site falls within an area zoned [“V”] and the [“VE”] of Sha Ha. There is no strong planning justification for rezoning the application site from “V” to [“R(B)6”] to make provision for non-Small House developments. The current “V” zone for the application site is considered appropriate and should be retained to reserve land for meeting the demand for Small House development and village expansion […]

21.  In short, the RNTPC was of the view that the planning intentions underlying the “V” zone were still valid.

22.  The RNTPC refused the 2020 Application also because it thought the Applicants failed to demonstrate that the rezoning would not adversely impact the archaeological interests of Sha Ha located within the Site and the Adjoining Land. This point is no longer relevant, because the Applicants managed to overcome this in its next application.

23.  On 20 November 2022, at a meeting (“SKRC Meeting”) of the Sai Kung Rural Committee (“SKRC”), attended by the Chairman, the Indigenous Inhabitant Representative (“IIR”) of Sha Ha, the Resident Representative (“RR”) of Sha Ha SKRC, and other villagers, there was discussion as to the Application to change the land use of private land in Sha Ha Village. The minutes of the meeting record that there was unanimous agreement to the application.

24.  As to the potential demand for Small Houses in the Village and the scope of land available for development, the minutes record the expressed view of the IRR and RR that within 10 years, there would be only around 7 to 8 Dings who could attain the age of 18. Therefore, there was unanimous agreement that the number of applications for Small House licences was far lower than before, thus it was estimated to reserve approximately eight applications for Small House Licences, and the land which would be reserved as “V” zone would be enough to meet the Village’s demand for Small Houses in the next 10 years. It was also unanimously agreed that Sha Ha Village would no longer accept any cross-village applications.

25.  On 21 June 2023, the Applicants submitted the Application through Arup and Ms Yeung, to make another attempt at rezoning the Site from “V” to “R(B)6”. This time, the proposed development land was reduced to the area of the Site (i.e. 12,689m², or a 4.1% decrease compared to the 2020 Application), by foregoing its previous plan of developing part of the Adjoining Land. This was a conscious effort on the Applicants’ part to leave more reserved land for Small House development and thereby remedy the shortcomings of the 2020 Application (“Reserved Area”).

26.  The PlanD estimated that this would open up space for 6 Small Houses, whilst the Applicants estimated that it would open up space for 11 Small Houses. The latter’s estimation was not seriously challenged by the TPB, save to the extent that it would be a very tight development of Small Houses in the Adjoining Land (perhaps doubting its feasibility). But it appears to me that an estimate of between 6 and 11 Small Houses is a reasonable one.

27.  Further, the area of the Site to be developed was 12,613m², with the remaining area of around 76m² to be carved out at the southern edge of the Site so as to avoid a high-pressure underground town gas pipeline.

28.  Besides reserving more land for Small Houses, the Applicants also sought to amend the OZP in the following manner: a maximum plot ratio of 1.5; a maximum building height of 10 storeys (excluding basement); and a requirement for a public vehicle park that is classified as a Column 1 always-permitted use.

29.  The Proposed Development would incorporate a stepped building height profile of 3 to 10 storeys ascending from east to west, a non-building area, and a buffer area for a high-pressure underground town gas pipeline. Moreover, according to the Applicants’ Indicative Scheme, the development would include one 3-storey residential tower in the north, two 9- and 10-storey towers in the south-west, with 14 3-storey detached houses at the eastern waterfront side, altogether providing 168 flats, as well as a clubhouse in the middle, and a public vehicle park of 120 spaces and an ancillary carpark of 134 spaces in two levels of basements. Identically to the 2020 Application, the development would also be accessible from Sha Ha Road to the south. The time for completion was predicted to be in 2029.

30.  The Applicants also proposed to exchange its land in the Adjoining Land with the government land located in the Site, thereby (1) to acquire the entirety of the Site for itself (assuming it also acquired the lone portion of the Site from the third-party owner mentioned above), and (2) to divert future Small House developments outside the Site.

31.  The documents submitted towards the Application included: an application form, with an original authorisation letter, documentary proof of land ownership, and hard copies of notifications given to the “Current Land Owners” attached to the form; a consolidated supplementary planning statement dated 17 January 2024, including technical assessments and a series of plans; and the proposed amendments to the OZP’s notes and explanatory statement. The PlanD also prepared a paper outlining the Application for the RNTPC’s consideration (“RNTPC Paper”).

32.  In the RNTPC Paper, the Applicants sought to justify the Application along the following material lines:

(1)  the demand for Small House development at the Site remained insignificant throughout the years;

(2)  there were no Small House applications being executed or processed as at the Application; and

(3)  some villagers indigenous to Sha Ha supported the Proposed Development, according to the minutes of the SKRC Meeting attended by the Chairman of the SKRC, the IIR of Sha Ha, and the RR of Sha Ha.

33.  No relevant government bureau or department expressed objections of any kind against the Application, while the PlanD identified that it had no in-principle objection to the Application.

34.  It is also fair to point out that in the ‘Background’ section of the RNTPC Paper, it was noted that based on the latest estimate by the PlanD, about 1.41 ha of land (equivalent to 56 Small House sites) is available within the three “V” zones in Sha Ha, amongst which 1.25 ha (about 89%, equivalent to 50 Small House Sites) falls within the Site.

35.  The Lands Department (“LandsD”), through its District Lands Officer/Sai Kung, noted in a table that (“Table”):

(1)  The number of outstanding Small House applications in the Village was only 1, which fell outside the Site but within the “V” zones of Sha Ha.

(2)  The numbers of Small House applications in the “V” zones (not just the Site) received, approved and rejected by the LandsD in the 10 years prior to the Application were 0 receipts, 0 approvals, and 30 rejections (1 in 2014, 17 in 2015, and 12 in 2021) – and this remained the position as at the rolled-up hearing.

(3)  There were 12 Small House applications approved within the Site before 2013, but which are now no longer valid because the 12 applicants (“12 SH Applicants”) had since sold their land to the Applicants by 2015, albeit being officially rejected only in 2021 (“12 Rejections”).

(4)  Since 2005, certificates of compliance have been issued to 5 completed New Territories Exempted Houses (i.e. Small Houses) in the “V” zones of Sha Ha, whilst there were 4 approved but uncompleted Small House developments in Sha Ha located outside the Site.

(5)  There is one outstanding cross-village application for a Small House in another village in Sai Kung submitted by an indigenous villager of Sha Ha.

(6)  The 10-year demand forecast for Small Houses in Sha Ha as at 6 January 2014 was 11, which was made by the IIR. The LandsD however has not verified this forecast, which has not been updated since the forecast was first made.

36.  Under the section in the RNTPC Paper entitled “Planning Intention and Small House Demand”, the following matters were also noted:

(1)  Since 2005 only 5 Small Houses have been completed and 4 have been approved but uncompleted in the 18 years preceding the Application, despite the relatively large area of “V” zone land in the entirety of Sha Ha (approximately 1.8ha).

(2)  The planning intentions of the “V” zones have not fully materialised, where the Site has been left vacant for over three decades, and in recent years has been temporarily used as an open-air carpark with temporary structures.

(3)  These matters must be contrasted with the “genuine need” for Small House development in Sha Ha.

(a)  According to the PlanD’s estimate, the rezoning would leave 0.16 ha of land for “V” zones, which (as noted above) the PlanD estimated to be equivalent to only 6 Small Houses.

(b)  While the 10-year projected demand of the IIR was 11, which prima facie meant that the remaining “V” zone land would be unable to meet that demand, the TPB since 2015 adopted a cautious approach (“Cautious Approach”) in assessing Small House demand by placing more weight on outstanding Small House applications, rather than projected demand.

(c)  Only 1 outstanding application was received in the 10 years preceding the Application (i.e. 2013 to 2023), and there was no valid extant application within the Site.

(d)  By applying the cautious approach, the land available for Small House development in the “V” zones of Sha Ha would be sufficient to cater for the outstanding Small House application.

(e)  As such, the Site could be rezoned to facilitate the Proposed Development and help address the acute shortfall of housing in the territory and public parking facilities in Sai Kung.

(4)  The LandsD advised that if the Application were approved, the Applicants must apply to it for the land exchange in order to effect the Proposed Development, which shall be considered by the LandsD at its absolute discretion in its capacity as landlord, and without guaranteeing the approval of any exchange application.

37.  The Plan D specifically noted that there would be sufficient remaining land available for Small House development. It was due to these various matters that the PlanD agreed in principle with the Application.

C.  The Decision

38.  The RNTPC had its meeting on 26 January 2024 (“RNTPC Meeting”). After the representatives of the PlanD and the Applicants introduced the background of the Application, the RNTPC then invited questions from these representatives. This process clarified or repeated the following relevant points.

39.  In respect of the “V” zones of Sha Ha and Small House demand:

(1)  Sha Ha referred to the recognised village within the VE as shown in the OZP. There was no information regarding the number of villagers currently living in Sha Ha.

(2)  Under the SH Policy, Small House development should be confined within the VE of Sha Ha, which comprises the three “V” zones, the Site, and the Adjoining Land. If the Application were approved, the eligible indigenous villagers of Sha Ha (i.e. Dings) may only build Small Houses within the remaining portion of “V” zones in Sha Ha or otherwise via cross-village applications in other villages in Sai Kung.

(3)  The remaining portions of available “V” zones post-rezoning would yield 6 Small Houses. This was borne from the PlanD’s estimate of 40 Small Houses per one hectare of land.

40.  Regarding the Table:

(1)  While there were no Small House applications received in the previous 10 years, there were rejections by the LandsD in certain years and it was understood that these rejected applications were received before 2013, thereby falling outside the period covered by the Table.

(2)  The 12 Rejections occurred due to a change of land ownership, in that the land which the applications were subject to were no longer available for the respective applicants to build Small Houses. These applications were located within the Site.

(3)  Demand was estimated by reference to (a) outstanding Small House applications and (b) the 10-year Small House demand forecast provided by the IIR. More weight is given to (a) by the TPB since August 2015 under the cautious approach. As noted above, the outstanding application was 1 and the IIR’s forecast was 11 in 2014.

41.  As to the Applicants’ proposal to address potential Small House demand:

(1)  If rezoning were approved, the Applicants would have to submit a land exchange application to the LandsD to consolidate their ownership of the Site. The land owned by the Applicants in the Adjoining Land would be surrendered to the Government in exchange for the government land within the Site. Then, the government owned Adjoining Land would be available for Small House development under the SH Policy. Also, the Application development area was reduced by 541m² compared to the 2020 Application, so as to leave more land for Small House development (i.e. the Reserved Area).

(2)  The Reserved Area would accommodate 11 Small Houses (according to the Applicants’ representative), which would be sufficient to meet the 10-year forecast made by the IIR. Furthermore, during the SKRC Meeting, the SKRC’s Chairman, the IIR, and the RRs of Sha Ha, as well as some villagers, expressed no objection to the rezoning proposal, after considering the living environment of the area would be improved with the provisioning of underground public vehicle parking and “at-grade greening”.

(3)  The Applicants have been keeping close contact with the local villagers in Sha Ha. In early 2020, the Applicants held a meeting with the SKRC during which the Chairman supported the Proposed Development.

(4)  The SKRC Chairman, IIRs and RRs who the Applicants have previously consulted in 2021 and 2022 were elected for the current term in the 2023 Rural RNTPC Election and the Rural Representative Election. While the Chairman remained the same, the previous IIR was elected as an RR while the previous RR was elected as the IIR (i.e. they swapped positions).

(5)  There was no public comment from the SKRS or village representatives of Sha Ha during the statutory publication period of the Application. Also, among the 417 public comments on the Application (381 of which were in support), none were submitted by the local villagers of Sha Ha.

42.  Finally, it was noted that the planning intention of the “V” zone is primarily for village type development. ‘House (New Territories Exempted House (NTEH) only)’ use is a Column 1 always permitted use, whereas ‘Flat’ and other ‘House’ uses were Column 2 uses which require prior planning permission. Meanwhile, in an “R(B)6” zone, the primary intention is for medium-density residential development, with ‘Flat’ and ‘House’ – including Small Houses – as Column 1 always permitted use. However, even if this means that Small Houses are always permitted under “R(B)6”, there is nonetheless a shift of planning intention emphasis from village to residential development.

43.  The RNTPC then deliberated, and made the following observations:

(1)  One member queried whether the persons who were subject to the 12 Rejections (i.e. the 12 SH Applicants who sold their land to the Applicants) were still eligible for Small House applications. Mr Lawrence Chan, Assistant Director/Regional 3 of LandsD, answered that there was no relationship between the indigenous villagers’ rights of building Small Houses and land ownership. They could still apply for Small Houses on their own lots or on government land within their villages. Further, cross-village Small House applications were also possible, albeit uncommon due to possible strong objections from local villagers.

(2)  Some members held adverse views of the Application:

(a)  The Site was largely under the Applicants’ ownership and might render the planning intention of the “V” zone within the Site no longer effective.

(b)  There had never been a similar application for rezoning such a major portion of a “V” zone situated within the VE previously approved by the TPB. Approval of the Application may establish an undesirable precedent for similar types of applications in the future by encouraging non-village type developments and land ownership consolidation.

(c)  While the SKRC’s Chairman and the village representatives of Sha Ha supported the Application, they did not necessarily represent the views of all eligible indigenous villagers who may wish to apply for Small Houses in the future. If rezoning were approved, the remaining land available might not be sufficient to meet Small House demand and cater for future village expansion. This would then create a situation whereby these villagers would have to seek permission to erect Small Houses outside the “V” zone in areas such as “Green Belt”.

(d)  The outstanding Small House applications and the 10-year Small House demand forecast provided by the LandsD (via the IIR) might not be able to reflect the genuine need for Small House development in Sha Ha. The persons subject to the 12 Rejections could still re-submit their applications because the change of land ownership did not affect their eligibility to apply for a Small House grant. Additionally, there will be 7 to 8 male indigenous villagers in Sha Ha in the next 10 years from November 2022 onwards (“Prospective Villagers”), who would then be eligible to apply.

(e)  The reservation of 541m² (which would accommodate 6 Small Houses) could not demonstrate that the potential demand would be met in the future since the Site was the last piece of “V” zone of considerable size for Sha Ha.

(3)  A few other members had different views:

(a)  They doubted whether there was a genuine need for a large swathe of “V” zone to address Small House demand or village expansion for Sha Ha.

(b)  While actual demand for Small House development was hardly ascertainable, it was not unreasonable that the government land within the Site (which may accommodate 8 Small Houses as per the PlanD’s method of estimation) could be reserved for Small House development.

(c)  The Site, which was left vacant for a long time, should be better utilized for development in an ordered and systematic manner given its reasonable size and readiness in availability from a land utilisation viewpoint. Since most of the Site was owned by the Applicants, it was unlikely that the Site would be developed for Small Houses even if it was kept as a “V” zone.

(4)  In response to a member’s query, the RNTPC’s Secretary repeated that (a) “V” zones are normally designated by reference to a 10-year demand forecast from the IIR, the number of outstanding applications provided by the LandsD, and the physical context and site constraints of the concerned village; (b) the Cautious Approach was adopted since 2015; and (c) the rezoning from “V” to “R(B)6” would change the primary planning intention from village to medium-density residential development. The RNTPC’s Chairman also supplemented that “V” zones are designated to reflect the existing village clusters within the VE of a given village, as well as to adopt an incremental approach.

(5)  The Chairman also remarked that while the Site was substantially owned by the Applicants, further change of land ownership in the future could not be ruled out. The Chairman advised the RNTPC members to consider if the planning intention of the “V” zone to provide land for Small House development for Sha Ha was still valid and if the remaining land was sufficient to meet demand. Given the remaining area within the VE of Sha Ha was mainly road and slope, future Small House development would likely be concentrated in the remaining area of the “V” zone in the Adjoining Land post-rezoning.

(6)  The Chairman concluded that while the RNTPC members considered that the Proposed Development might not be unacceptable, there was still a need to reserve suitable land as “V” zone to address potential demand for Small House development in Sha Ha. Thus, it was appropriate to retain the “V” zone within the Site, unless it could be demonstrated that the potential demand could be met even if part of the “V” zone was rezoned to “R(B)6”. Such rezoning requires the retention of adequate land to cater for future demand, and the reserved land should be adequate size. For instance, the reserved land should at least be more than the government land within the Site (because the government land in the Site would provide 8 Small Houses, rather than merely 6).

44.  The deliberations are of interest in seeing the areas of debate, but the Decision was that of the RNTPC as a whole. In its Decision, the RNTPC did not agree with the Application. Its ultimate reasons were:

the application site falls within an area zoned (“V”) and the village ‘environs’ of Sha Ha. The subject “V” zone is the only sizeable “V” zone for Sha Ha. There is no strong planning justification for rezoning the application site from “V” to [“R(B)6”] to make provision for non-Small House developments. The current “V” zone for the application site is considered appropriate and should be retained to reserve land for meeting the demand for Small House development and village expansion.

45.  It can be noted that the RNTPC’s reasons for rejecting the Application mirror its rejection of the 2020 Application, save for one sentence – that the Site and the Adjoining Land overlap with the only sizeable “V” zone left for Sha Ha. The precise wording was in the main, other than that additional sentence, the reasoning offered in the RNTPC Paper should the RNTPC decide not to agree to the Application.

D.  Intended Grounds of Review

46.  By way of introduction to the intended grounds of review, the Applicants have sought to stress three features of the Decision:

(1)  The Decision went against the opinion and advice of the PlanD, which had relied on data from the LandsD and had conducted an independent analysis to show why the Site, even if re-zoned, would meet the Village’s demand for Small Houses.

(2)  The Decision went against the Village’s expressed views concerning the re-zoning proposal, as expressed through the Chairman of the SKRC, the IIR and the RR.

(3)  The Decision assumes that the Site could not be used for Small House development if the Site was rezoned to “R(B)6”, which contradicts the Notes and Schedule of Uses to the OZP, and advice from the PlanD representative.

47.  In that context – and rid of the heavy outer clothing (Mr Chan’s phrase) the Applicants raise and focus on four intended grounds of review to challenge the Decision:

(1)  Ground 1: The TPB (i.e. the RNTPC) took into account an irrelevant consideration, i.e., that the Application, if granted, would reduce the land available to the Dings of Sha Ha to building Small Houses. However, Small Houses can still be built on the Site, even if it is re-zoned from “V” to “R(B)6”. The amount of land available for Dings to build Small Houses does not change even if the Application is granted.

(2)  Ground 2: The TPB took into account an irrelevant consideration that the Application would make it more expensive or difficult for Dings to purchase land to build Small Houses on the Site or in its vicinity.

(3)  Ground 3: The Decision was tainted by error of fact or was irrational as the TPB proceeded on the basis that there was a large actual or potential demand for Small Houses in the vicinity. Alternatively, there was a failure to give intelligible reasons as to why and how it concluded that there was a large demand for Small Houses.

(4)  Ground 4: The Decision was tainted as the TPB took into account demand that had no sign of imminent realization, which is an irrelevant consideration.

48.  In his submissions, Mr Chan clarified that Ground 3 and 4 were at the forefront of the Applicants’ case and they were to be dealt with together. In part because of that, I think I can deal with Grounds 1 and 2 relatively succinctly.

E.  The TPB’s Role and Judicial Review

49.  It is important to see this challenge in the context of the TPB’s role.

50.  There was little serious dispute between the parties regarding the relevant applicable legal principles. The only material point of divergence was as to the proper interpretation of the SH Policy. This can be addressed below, but it is first helpful to set out the TPB’s statutory role.

51.  It is trite that the TPB, as a specialist statutory body, with a broad membership, and which exercises professional judgment on planning matters, must be accorded a wide margin of appreciation to its assessments and decisions by this Court: see Hysan Development Co Ltd v TPB [2016] 19 HKCFAR 372 at §126. As with any typical judicial review, the Court is not so much concerned with the merits of such decisions, but rather more concerned with their procedural integrity: see Hong Kong Resort Co Ltd v TPB [2021] HKCA 1313 at §21.

52.  The material provisions of the TPO provide:

3. Functions of the Board

(1) With a view to the promotion of the health, safety, convenience and general welfare of the community, the Board shall undertake the systematic preparation of—

(a) draft plans for the lay-out of such areas of Hong Kong as the Chief Executive may direct, as well as for the types of building suitable for erection therein

…

4. Contents of lay-out plans and powers of the Board

(1) The Board’s draft plans prepared under section 3(1)(a) for the lay-out of any such area may show or make provision for—

…

(h) zones or districts set apart for use for village type development, agriculture or other specified rural uses

12A. Amendment of plans on application to the Board

(1) Subject to subsection (2), an eligible person may apply to the Board for consideration of any proposal in relation to—

(a) any part of an approved plan that is an original approved plan; or

(b) any approved part of a partly approved plan that is an original approved plan.

53.  Under a section 12A application, the TPB is engaged with the creation of draft plans. The focus must be upon whether the proposed new zoning for a given site is appropriate and acceptable from a planning viewpoint and desirable in the public interest. The inquiry is both general and guided by the statutory purpose of plan-making under section 3(1). Such an application is not objectionable on the mere footing that the proposal is inconsistent with an existing planning intention or policy contained in the outline zoning plan that the application seeks to amend: see Join Smart Ltd v TPB [2021] 4 HKLRD 647 at §47; and Royal Billion Investment Ltd v TPB [2021] HKCFI 1093 at §88.

54.  In Hong Kong Resort Co Ltd v TPB [2021] HKCA 1313 at §§21-25, the Court of Appeal summarised five fundamental propositions applicable to judicially reviewing decisions made under section 12A that are challenged on ‘irrelevancy’ grounds – as for example in Ground 1 (see below). They are:

(1)  In an application for judicial review, the Court is concerned only with the legality of the decision-making process, not with the merits of the Decision. The Court should be vigilant against excessive legalism creeping in as a planning decision is not akin to an adjudication made by a court, and planning policies do not normally require intricate discussion of their meaning.

(2)  There is a clear distinction between the question of whether something is a material consideration and the weight which it should be given. The former is a question of law for the Court. The latter is a matter of planning judgment for the planning authority.

(3)  Material considerations in this context mean relevant considerations, namely that they are relevant to the exercise of the particular power, and for the purposes for which the power was granted.

(4)  Relevant considerations to which a planning authority is entitled to have regard must be of a planning nature. In principle, any consideration which relates to the use and development of land is capable of being a planning consideration.

(5)  Section 3(1) of the TPO requires the TPB to undertake the systematic preparation of draft plans for the layout of such areas of Hong Kong as directed by the Chief Executive, with a view to the promotion of the health, safety, convenience and general welfare of the community.

55.  In gist, depending upon the specific circumstances of each case, the TPB must take into account planning considerations relevant to a section 12A application, and not irrelevant ones. Matters of weight, however, including the manner and intensity of any inquiry on relevant matters, are entirely for the TPB to assess, not the Court – barring, of course, an interference based on Wednesbury unreasonableness.

56.  Mr Chan cited §52 of the Hong Kong Resort case for the proposition that a decision which considers irrelevant matters may amount to an unreasonable one in the Wednesbury sense. This paragraph, however, was meant to point out nothing more than the legal principles set out immediately above. Whilst a decision-maker who fails to exclude from his consideration matters which are irrelevant may be said to be acting unreasonably in taking into account extraneous matters, any call to Wednesbury unreasonableness adds little if anything to the analysis in this regard.

57.  In Smart Gain Investment Ltd v TPB (unreported, HCAL 12/2006, 6 November 2007) at §§90-95, Andrew Cheung J (as the Chief Justice then was) discussed the relevant principles for ‘error of fact’ as a ground for judicial review – as for example advanced in Grounds 3 and 4 (see below).

58.  At §94, he observed that under a challenge based on mistake of fact giving rise to unfairness, fresh evidence must be admissible in appropriate circumstances to enable an applicant to demonstrate to this Court that the decision-maker made a mistake on the facts.

59.  At §93, he also cited with approval E v Secretary of State for the Home Department [2004] QB 1044 at §66, where Carnwath LJ (as Lord Carnwath of Notting Hill then was) listed the prerequisites for mistake of fact:

(1)  There must have been a mistake as to an existing fact, including a mistake as to the availability of evidence on a particular matter.

(2)  The fact or evidence must have been “established”, in the sense that it was uncontentious and objectively verifiable.

(3)  The applicant must not have been responsible for the mistake.

(4)  The mistake must have played a material but not necessarily a decisive part in the decision-maker’s reasoning.

60.  The touchstone is any substantive unfairness as the result of a mistake, and the Court will not probe to look for mistakes. I also accept that in the context of a multi-faceted decision, such as those on planning questions, mistakes of fact may be made which are nonetheless not grave enough to undermine the basis of that decision. Further, where what is said to be the mistake is not one of fact, but a matter of evaluation or judgment based on facts or the weighing of facts, that will not fall within the area of challenge upon a material error of fact. The weight to be accorded to matters in the balance is ordinarily something for the decision-maker, such as the TPB.

61.  The TPB has two principal functions, but it is important to recognise that there is a difference between (1) an application under section 16 of the TPO for “permission” as provided for in a plan in order to pursue a proposed development, and (2) an application under section 12A to amend a plan, which forms part of the TPB’s plan-making function. In the former case, any grant of permission by the TPB may be subject to such conditions as the TPB thinks fit. On the other hand, in a rezoning application under section 12A, the TPB has no power to impose conditions. The TPB’s powers are limited to (1) accepting, in whole or in part, the application, or (2) refusing the application: see the Royal Billion Investment case at §87.

62.  I take these principles into account.

F.  Ground 1: Irrelevancy of the rezoning’s effect on land supply for Small House development in Sha Ha

63.  Under Ground 1, Mr Chan argued that under “R(B)6”, ‘House’ of whatever type will always be permitted under Column 1 of page 8 of the Schedule of Uses of the OZP. Thus, after the Site is re-zoned to “R(B)6”, there is nothing in principle that would prevent a Small House from being built without planning permission on the Site. The crux of the submission is that re-zoning would not result in inadequate supply of land to meet demand for Small Houses. It was therefore an irrelevant consideration for the Committee to take into account that rezoning would reduce supply of land to meet Small House demand.

64.  Mr Pao sought to rebut that submission with two simple arguments. First, re-zoning from “V” to “R(B)6” would shift the primary planning intent of the Site from village to medium-density residential development. Second, and more pertinently, given that the Proposed Development of the Site involves developing 99.4% of it, as well as the unlikely scenario that the Applicants would sell some of its own land to be used for Small Houses, the practical reality will be that the Site would not be used for village development.

65.  Mr Chan in reply first contended that unless and until Dings could successfully acquire land within the Site, such land would never be available supply. But the Decision’s effect was to compel the Applicants to sell their land to anyone else, including Dings. Indeed, Mr Chan said that the TPB had an ulterior motive of pressuring the Applicants to dispose of their land only to Dings at an affordable price. This is because, as the submission became clearer during the hearing, the rezoning of the Site would increase the price of the land to non-residential developments such as Small Houses.

66.  However, this is beside the point. It might be thought that that the position was the other way round, and that it was the Applicants who were pressuring the TPB to grant the Application because they already owned a substantial amount of land in the Site and would keep owning the land even if the Application were rejected – a fait accompli, as it were. But Mr Pao is correct to say that it was not for the TPB to consider such matters and nor did it do so. Its proper ambit of concern was limited to whether supply would meet demand post-rezoning as proposed. This is quite apparent from the RNTPC Meeting and the Decision.

67.  Secondly, Mr Chan said that the government land within the Site may be used for village type development post-rezoning. Yet (1) this goes against the developmental area of 99.4% of the Site, and (2) it was only during the hearing that Mr Chan suggested that the developmental area may be reduced in the southern portion of the Site. This was not raised before the RNTPC, nor was it canvassed in the RNTPC Paper. As to planning considerations, this Court is not the proper forum for such matters, as that is for the TPB to consider. Perhaps pertinently, this flatly contradicts the Applicants’ intention to exchange the Adjoining Land it owned with the government land in the Site. Obviously, if the Applicants succeed in exchanging its land for the Government’s, there would be much less government land in the Site available for Small House grants. Regardless, it remains unclear to me how much available land, after an exchange, would be available post-rezoning, if the developmental area covers most of the Site anyway.

68.  I agree with Mr Pao that despite the always permitted use of village type development post-rezoning, the change in emphasis and the Applicants’ ownership of most of the Site might affect adequate supply of land to meet Small House demand. These were, therefore, considerations at least relevant to the RNTPC’s exercise of its decision-making powers under section 12A of the TPO.

69.  Ground 1 is not reasonably arguable with any realistic prospect of success.

G.  Ground 2: Irrelevancy of the TPB’s alleged ulterior motive

70.  This ground centred upon Mr Chan’s ulterior motive point which I have already mentioned above. This is a serious allegation, but on the materials I am not convinced that it is reasonably arguable that the TPB had any such motive, or any motive other than performing its statutory function in determining (amongst other things) if supply post-rezoning would meet future demand.

71.  Mr Chan also supplemented this point with his interpretation of section 3(1) of the TPO. He said that the word “community”, though left undefined in the TPO, was translated to “社區”, which I am told refers to a geographical area wherein a community resides or is found, rather than to classes of individuals (such as Dings). Hence, he said the latter are irrelevant, because they do not fall under the meaning of the word “community” under section 3(1).

72.  I reject this submission as not reasonably arguable, for the primary reason that it would be too narrow a view, and would be contrary to the wide discretion the TPO affords to the TPB when considering applications under section 12A. It also goes against what was said by the Court of Appeal in the Hong Kong Resort case in its fourth point (see above). The exercise of the decision-making power must include assessing whether the primary usage of a site and its capacity to meet that usage would remain satisfactory in any proposed rezoning in the specific circumstances of a given application.

73.  Ground 2 is not reasonably arguable with any realistic prospect of success.

H.  Grounds 3 and 4: Error of Fact and/or Irrelevancy of the 12 Rejections and change of land ownership

74.  As already mentioned, Mr Chan argued these two grounds together. Much of that argument centred upon the RNTPC’s assessment of actual and/or potential demand for Small Houses in Sha Ha. Mr Chan said that it suffices to ascertain whether the demand was an “actual” or a “meaningful” one, in order to scrutinise whether the Decision should be upheld upon this basis. In doing so, he side-stepped the Applicants’ initial presentation that the RNTPC considered the demand for Small Houses to be “strong” or “large”.

75.  The Applicants’ argument was that the demand for Small Houses was illusory or almost non-existent, on the following basis:

(1)  The LandsD did not receive a single application to erect a Small House between 2013 and 2023. This directly disproved the IIR’s 10-year forecast of 11 applications in 2014.

(2)  Between 2020 and 2023, the Applicants retained close contact with the IIR and RR of Sha Ha and the SKRC’s Chairman in respect of the Application’s impact on eligible villagers for Small Houses and other villagers of Sha Ha. This included holding six meetings. Neither the Chairman nor the representatives considered that the villagers have an appetite to build Small Houses in the Site. Furthermore, cross-village applications from villagers not indigenous to Sha Ha, if any, would fail because it was unanimously resolved in the SKRC Meeting that the villagers of Sha Ha would not accept such applications anymore.

(3)  As to the Prospective Villagers, their eligibility to apply must not be confused with the actual demand for Small Houses. In gist, due to various possible reasons, such as minimal financial means or pure desire to live somewhere else, only a small number of these Prospective Villagers might or would eventually apply for Small House grants. Tied with this was Mr Chan’s point that as 2047 draws near, common sense dictates that the applications for Small House grants will rapidly decline if not become entirely obsolete, as it would not be worth the money and effort in erecting a house for only a short period of enjoyment of the available lots’ lease that will expire by that year.

(4)  There was an irresistible inference that the Government did not or would not demise any of its land within the Site to any Dings for the purpose of erecting Small Houses. The inference arises because (a) had the Government granted such land, it would be inconceivable that no application for Small Houses were received by the LandsD from 2013 to 2023, and (b) no such grant was intimated in the RNTPC Paper nor mentioned during the Committee Meeting. Furthermore, this inference corroborated (1) to (3) above.

(5)  Despite having been afforded ample opportunity to raise an objection, no Ding of Sha Ha did so during the statutory publication period.

(6)  The Committee erred in viewing that the 12 SH Applicants might re-submit their applications in the future:

(a)  The 12 applications were initially approved, but were later invalidated, rather than rejected, since the 12 SH Applicants sold their land to the Applicants.

(b)  This meant that the 12 SH Applicants used up their once-in-a-lifetime right to a grant to erect a Small House, so that none of them would be eligible to re-apply under the SH Policy.

(c)  The error arose from the use of the word “reject” to describe the those applicants’ ineligibility from re-applying for a new grant. Alternatively, the error was the RNTPC’s view that eligibility had no relationship to land ownership.

(d)  Regardless, there was a need for further investigation as to the 12 SH Applicants’ actual willingness and ability to re-apply.

(7)  In any event, the government land within the Site, which would yield 8 Small Houses (as per the PlanD’s method of estimation), coupled with the Adjoining Land, would amount altogether to adequate demand for Small Houses in the future.

76.  Mr Pao, on the other hand, argued that:

(1)  The RNTPC was concerned with ensuring that sufficient land was reserved for potential demand for Small Houses in the future. The Applicants failed to show that the RNTPC was plainly wrong in concluding that there would be insufficient demand for Small Houses post-rezoning.

(2)  The IIR’s previous forecast, although outdated and proven to be wrong, was in any event unverified by the LandsD, which explains why the RNTPC thought that it may not reflect the genuine need for Small Houses, given that (a) the 12 SH Applicants may re-apply, and (b) 7 to 8 Prospective Villagers may apply in the future.

(3)  An indigenous villager’s right to build a Small House would not be affected by land ownership.

(a)  First, the very fact that the 12 SH Applicants made the earlier applications suggests that they were interested in obtaining a Small House grant.

(b)  Secondly, as a matter of procedure, this point was raised by the Applicants at so late a stage without pleading it in their Form 86 that it must be rejected since the TPB was not afforded an opportunity to adduce detailed evidence to address the point.

(c)  Thirdly, and in any event, the 12 SH Applicants, although being initially approved, did not exhaust their concessionary right to erect a Small House under the SH Policy.

(4)  The potential demand arising from the 7-8 Prospective Villagers was accorded appropriate weight by the RNTPC, which did not meet the 6 Small House estimate of the PlanD. The RNTPC did not conclude that all of the 7-8 villagers would apply, but rather that the Applicants simply failed to convince them that there was sufficient land in light of this potential demand.

(5)  As to the 2047 point, it is laden with speculation and was never argued in the Applicants’ Form 86 at the outset.

(6)  Overall, it was far from uncontentious that there is no actual or potential demand for Small Houses in the area.

(7)  The RNTPC was entitled to accord whatever weight to the PlanD’s support of the Application, given that it was entitled to assess that weight in light of other factors.

(8)  It was therefore not irrational for the RNTPC to depart from the PlanD’s support, or not to accept that the prospective demand was actually lower than its estimate of 6 Small Houses in the Adjoining Land.

77.  As to the government land in the Site, I do not find Mr Chan’s submissions in this respect convincing. First, his stance that the government land may be coupled with the Applicants’ land in the Adjoining Land to produce at least 14 Small Houses combined is contradictory to the Applicants’ pleaded case, and indeed, its position during the Application. It must be recalled that the Applicants’ position in the Application was to exchange its land for the government land within the Site. Moreover, during the hearing, Mr Chan submitted that not all of the government land would be exchanged since only the middle part and some of the southern parts of the Site would be sought via the exchange, leaving more southern portions as government land (i.e. more than the 76m² mentioned in the RNTPC Paper). However, these submissions were not reflected in the RNTPC Paper nor during the RNTPC Meeting, and were only raised during the hearing. In contrast, in the RNTPC Paper, the development site encompassed nearly all the land in the Site, leaving less than 1% of land in the southern tip undeveloped. I agree with Mr Pao that this is a new point that ought to have been raised before the RNTPC, and in any event is a proper matter for a new application for re-zoning, not for this Court.

78.  I can accept Mr Pao’s submission that from the very fact that the 12 SH Applicants previously applied for permission that suggests they were once interested in obtaining a Small House grant. But that is only to state the obvious, and it says nothing about any continuing intention. Rather more telling is the fact that the 12 SH Applicants chose to sell the relevant land notwithstanding having obtained approval or grant, which strongly suggests that they were no longer interested in erecting a Small House of their own.

79.  Anyway, it became apparent at the hearing that one important area of the dispute between the parties was whether the 12 SH Applicants who had received the 12 Rejections remained eligible under the SH Policy to re-apply for Small House grants after alienating their land.

80.  In essence, Mr Chan submitted that if the issue was answered in the negative, then the RNTPC arrived at its Decision on a material error of fact or considered an irrelevancy, because during its deliberation it was advised that eligibility for a grant does not depend upon land ownership, which Mr Chan said was incorrect. If the 12 SH Applicants may not re-apply, then the only viable source of demand would be the 7-8 Prospective Villagers, all of whom for reasons explained above would unlikely apply for a grant, and thereby demand would be met by the 6 or 11 Small House estimate of the PlanD or the Applicants.

81.  This line of the argument depends upon the proper interpretation of the SH Policy. The pamphlet entitled ‘How to Apply for a Small House Grant’, which outlines the SH Policy, provides the relevant criteria for a Small House grant:

(1)  The applicant must be a male indigenous villager of 18 years of age or above, and a descendant of the male line stemming from a resident of a recognised village during 1898. Recognised villages are those approved and listed as such by the Director of Lands (see §§(I)(B)(b) and (I)(C)(a)).

(2)  A Small House grant may ordinarily be made in three ways. First, a “private treaty grant” for government land. Secondly, a “building licence” for private land. Thirdly, an “exchange” between a Ding’s non-village land for land located within a recognised village. As I understand it, an exchange may also occur between a villager’s private land located outside a recognised village for government land located within it (see §(I)(B)(c)(i)).

(3)  In respect of private land grants, it necessarily means that the applicant must first own a plot of land before he may apply for a building licence. This is supported by the fact that one of the requirements for applying for a grant is to provide the District Lands Officer a duplicate copy of a land title record (from the Lands Registry) of the lot under application (see §(I)(D)(f)(i)).

(4)  An applicant must not have previously received any Small House grant (see §(I)(C)(b)).

82.  On its face, the SH Policy is silent as to the effect on eligibility if, after being permitted to erect a Small House, the applicant subsequently sells the land to which the grant was subject, but before the Small House is erected.

83.  Mr Chan submitted that since the 12 SH Applicants’ requests for a grant were initially approved, their applications were later invalidated, not rejected. This was because once the approval is made, regardless of the type of land (i.e. private or government), the Small House grant is already made in favour of the applicant. By alienating the land that is subject to that grant, the applicant also foregoes the permission to erect a Small House on that land. Therefore, Mr Chan said, there is a relationship between an applicant’s eligibility for a grant of permission to erect a Small House and his ownership of the land to which that grant is subject.

84.  Mr Pao contended that one must instead focus on whether, after approval, the Small House has actually been erected. Even if an approved application was later rejected due to a change in land ownership, there was at the end of the day no erection of a Small House. Thus the permission to erect in the form of the grant was not exhausted.

85.  I disagree. According to §(a) of the Explanatory Notes of the SH Policy pamphlet, the policy was “formulated to allow an indigenous villager to apply for permission to erect, for once in his lifetime, a small house on a suitable site within his own village”. Though I accept the policy may not need to be construed as if it were a statute, the explanation for the policy seems to me to refer to the permission to erect, and not the fact of erection of, a Small House as making up the grant. I accept that the phrase “for once in his lifetime” is adjacent to the word “erect” (albeit after the comma), but that word is preceded by the words “permission to”. The applicant asks, “Can I have permission to erect a Small House on this land?” and the favourable answer would be, “Yes, permission is granted”. In other words, the grant is the grant of permission, and this is enough to constitute a “previous grant” under the SH Policy.

86.  This is also reflected in §D(h) of the SH Policy and §(f) of the Explanatory Notes of the SH Policy pamphlet, which identifies that if an application is approved an offer letter will be issued by the DLO to the applicant with a demand note for payment of the administrative fee and/or premium as the case may be. The administrative fee is levied for Small House grants. If it is payable upon the grant, then it can be said, looking back, there was a previous grant.

87.  But the grant of permission is also tied to the land for which the permission to erect a Small House is sought. Once granted, the applicant may either proceed with erecting a Small House, or perhaps keep the land and not build after all (which happens not infrequently), or perhaps forego the grant by selling the land in respect of which that grant was made. I think, and it does not seem to be in dispute, that alienation would naturally invalidate the grant. Logically, I think it would also bar the applicant from re-applying in the future for a new grant in respect of a new piece of land, both of which would be different from the previous grant that was subject to the alienated plot of land. If Mr Pao’s suggested interpretation were followed, it would disregard the ordinary and natural meaning of “previous grant”.

88.  To put it bluntly, the SH Policy seems to me to identify that if an applicant has been granted permission to erect a Small House on a piece of land he owns, then he must ‘use it or lose it’. Hence, the Applicants succeed in their interpretation of the SH Policy.

89.  The next question is whether this gave rise to a material mistake of fact. I think it did. Whilst issues of interpretation are legal in nature, and the process of interpretation is clearly not a fact, the end of that process leads to a factual conclusion – here whether the 12 SH Applicants remained eligible to re-apply for a grant, or not. Added to that is the factual assumption underpinning what might, I accept, be an evaluation of the likely potential demand.

90.  Alternatively, the RNTPC’s understanding was an irrelevant consideration for similar reasons.

91.  I also think that even if the interpretation preferred by me is incorrect, there was also serious doubt at the very least as to whether any of the 12 SH Applicants who had sold their land would ever seek to re-apply for a grant. I do think “potential” in “potential demand” must incorporate some element of real likelihood, beyond just a theoretical possibility. To proceed on the implied assumption that not only did the 12 SH Applicants remain eligible but there was a serious chance of them seeking re-grant seems to me to proceed on a factual basis that is in essence without foundation when looked at in the overall circumstances as could be seen from the other materials and departmental views set out in the RNTPC Paper. I do not think this is just a question of weight.

92.  This seems to me to show both Grounds 3 and 4 as reasonable arguable and substantively established.

93.  I can just touch on two remaining matters raised by the Applicants. Firstly, I do not think that the Decision was irrational for lack of adequate reasons. Indeed, it is telling that the Applicants managed to mount four detailed grounds of review against the Decision, thereby suggesting the adequacy of the RNTPC’s reasoning. Secondly, I do not think that the RNTPC considered the irrelevant point that the Application if approved would set an undesirable precedent. I see no proper concern about floodgates arguments.

I.  Result

94.  In these circumstances, I would grant the Applicants leave to apply for judicial review on Grounds 3 and 4. They also succeed in establishing the merits of these grounds.

J.  Relief

95.  Judicial review remedies are only granted by this Court’s exercise of discretion. In other words, the establishment of grounds for judicial review does not automatically lead to the grant of any relief, which remains in the discretion of the Court.

96.  Besides costs, the Applicants in this case have sought (1) an order of certiorari to quash the Decision, (2) an order directing the TPB to reconsider the Decision with regard to my judgment, and (3) other remedies or orders this Court may provide.

97.  It seems to me to be appropriate to grant (1) and (2). I so order.

98.  I will reserve the question of costs to be argued, on paper, after the parties have had the opportunity to consider this judgment. I leave it to Counsel to agree a sensible and suitable timetable for costs submissions.