THE INCORPORATED OWNERS OF FINANCE BUILDING v. BRIGHT HILL MANAGEMENT CONSULTANTS COMPANY LTD

DCCJ 4738/2020

[2024] HKDC 1773

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 4738 OF 2020

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BETWEEN

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JUDGMENT

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Introduction

1.  This is the trial between the plaintiff (ie Incorporated Owners of Finance Building) and the defendant as the owner of Flat C on 2^nd Floor of Finance Building, 254-256 Des Voeux Road Central, Hong Kong (“the premises”).

Absence of the defendant

2.  The defendant was absent at the pre-trial review and the trial.

3.  In the case management conference on 30 May 2023 when the dates for the pre-trial review and the present trial were fixed, the defendant was represented by Mr Lie Han Ji, its director.

4.  4 days before the pre-trial review, Mr Lie applied for an adjournment. His Honour Judge Harold Leong was of the view that mere production of a sick leave certificate was insufficient to show that he was incapable of attending a court hearing and dismissed the application.

5.  I am satisfied that the defendant has had due notice of the present trial and that the defendant has elected not to attend this trial.

6.  I therefore allowed the trial to proceed.

The plaintiff’s case

7.  By an extraordinary general meeting of the plaintiff held on 15 June 2016, it was resolved that the plaintiff was:

(a) to proceed with the repair works required by the Mandatory Building Inspection Scheme and to proceed with certain selected repair works of the building (“the repair works”);

(b) to engage Sunarts (Holdings) Engineering Limited as the assigned engineering company for the repair works; and

(c) to collect funds in the sum of HK$5,291,800 for the repair works by 3 instalments.

8.  The defendant’s share of contribution to the repair works was HK$155,641 of which the defendant only paid HK$18,158.20 leaving the outstanding balance of HK$137,482.80 unpaid.

9.  By a resolution of the plaintiff in a general meeting on 22 January 2016, the management charges which should be paid by the defendant was revised to HK$1,640 with effect from 1 March 2016.

10.  By a resolution of the plaintiff in a general meeting on 22 March 2019, the management charges which should be paid by the defendant was revised to HK$1,863 with effect from 1 May 2019.

11.  The defendant however only paid HK$1,040 per month from March 2018 to December 2019. Accordingly, the defendant had failed to pay outstanding management charges in the sum of HK$29,888.

The defence

12.  By it’s defence, the defendant put the plaintiff to strict proof and denied the plaintiff’s claim.

Findings of fact

13.  Section 14(1) of the Building Management Ordinance, Cap 344 provides:

“(1) Subject to this Ordinance, at a meeting of a corporation any resolution may be passed with respect to the control, management and administration of the common parts or the renovation, improvement or decoration of those parts and any such resolution shall be binding on the management committee and all the owners.”

14.  Section 18(1) and (2)(fa) of the Building Management Ordinance, Cap 344 provides:

“(1) The corporation shall —

(a) maintain the common parts and the property of the corporation in a state of good and serviceable repair and clean condition;

(b) carry out such work as may be ordered or required in respect of the common parts by any public officer or public body in exercise of the powers conferred by any Ordinance;

(c) do all things reasonably necessary for the enforcement of the obligations contained in the deed of mutual covenant (if any) for the control, management and administration of the building.

…

(fa) carry out any renovation, improvement or decoration work, as the case may be, to the common parts;”

15.  Mr Tsui Tat Wing, the treasurer of the plaintiff, gave evidence. He produced, among others, the resolutions of the following general meetings of the plaintiff held on:

(a) 15 June 2016 (“the 1^st resolution”);

(b) 22 January 2016 (“the 2^nd resolution”); and

(c) 22 March 2019 (“the 3^rd resolution”).

16.  The 1^st resolution resolved, inter alia, to proceed with the repair works; to engage Sunarts (Holdings) Engineering Limited as the assigned engineering company for the repair works; and to collect funds in the sum of HK$5,291,800 for the repair works by 3 instalments.

17.  The 2^nd resolution resolved, inter alia, to increase the management charges by 25% with effect from 1 March 2016.

18.  By a notice dated 23 February 2016, the plaintiff informed all owners of the revised management charges. In the case of the premises, it was $1,640.

19.  The 3^rd resolution resolved, inter alia, to increase the management charges with the use of lifts by 35% with effect from 1 May 2019.

20.  By a notice dated 8 April 2019, the plaintiff informed all owners of the revised management charges. In the case of the premises, it was $1,863.

21.  There is no evidence (and is not the case of the defendant) that those resolutions have been invalidated.

22.  I accept that those resolutions were binding on the defendant as the owner of the premises.

23.  By a notice dated 1 September 2016 issued by Messrs Pansy Leung Tang & Chua, solicitors on behalf of the plaintiff, all the owners were informed of the deadlines and amounts of contribution. All owners were notified to pay the sum of HK$51,880 before 30 September 2016 and 31 October 2016 respectively and the sum of HK$51,881 before 30 November 2016.

24.  It is Mr Tsui’s evidence that the defendant only paid HK$18,158.20 on 28 February 2017 which is supported by a deposit slip of Public Bank. I accept his evidence. The outstanding balance on the contribution is therefore HK$137,482.80 (HK$155,641 - HK$18,158.20).

25.  It is Mr Tsui’s evidence that the defendant had only paid the sum of HK$1,040 per month on management charges for the period from March 2018 to August 2020. I accept his evidence. The outstanding balance on management charges is therefore HK$21,568 (HK$600 × 14 months (from March 2018 to April 2019) + HK$823 × 16 months (from May 2019 to August 2020)).

CACV 386/2000

26.  In the defence, the defendant drew the attention of the court to CACV 386/2000. This is a case between the defendant and the plaintiff but entirely on different issues. It is therefore of no assistance to the defendant.

Conclusion and order

27.  By reasons of the aforesaid, I give judgment in favour of the plaintiff for the sum of HK$159,050.80 (HK$137,482.80 + HK$21,568).

Interest

28.  The plaintiff is entitled to interest at 1% above the best lending rate of HSBC from the date of writ (ie 7 September 2020) to the date of judgment and thereafter at judgment rate to the date of payment.

Costs

29.  I make a costs order nisi that the defendant shall pay the plaintiff the costs of this action (including all costs reserved) with certificate for counsel, to be taxed if not agreed.

30.  In the absence of an application for variation by letter within 14 days from the date of this judgment, the costs order nisi shall become absolute.