CHAN PUI LING v. KAI SHING MANAGEMENT SERVICES LTD

LDBM 334/2013

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

BUILDING MANAGEMENT APPLICATION NO. 334 OF 2013

__________________________

__________________________

________________

J U D G M E N T

________________

1.  The Applicant is the legal owner of Car Parking Space No. P45 on Level 5 (“the Carparking Space”) of Castello, No. 69 Siu Lek Yuen Road, Shatin (“the Development”).  The Respondent is the Manager of a Deed of Mutual Covenant and Management Agreement in respect of the Development executed 20 December 1999 and registered on 6 January 2000 (“the DMC”).  By a Notice of Application taken out on 19 December 2013 (“the Application”) the Applicant prayed for an injunction to restrain the Respondent from prohibiting her from using the Carparking Space disregard of her ownership of the same. In the Notice of Opposition, the Respondent contended that the Applicant not being a resident nor an occupant of any residential unit is not allowed to use the Carparking Space under Special Condition 27(1)(a) of a Government Lease executed on 27 June 1996 (“the Government Lease”).  In its Counterclaim, it asked for an injunction prohibiting the Applicant from using the Carparking Space until or unless she is qualified to use it under Special Condition (27).

Background

2.  The Development consists of 7 residential blocks, each with 32 floors.  The tower blocks are built on and above a 4-level podium inside of which carparking spaces and clubhouse facilities are provided.

3.  It is not disputed that on 28 May 2013, the Respondent issued a notice restricting use of carparking spaces by non-residents of the Development.

4.  On 1 January 2014, the Applicant found that the magnetic strip card allowing her to enter the car park of the Development was invalidated. She formed the view that by such act of the Respondent, she was wrongfully forbidden to use the Car parking Space owned by her.

5.  On 3 January 2014, an Inter-Partes Summons (“the Summons”) was taken out by the Applicant asking for an interim injunction pending trial on same term as prayed for in the Application.  On 16January 2014, at the call-over hearing of the Applicant’s Summons an interim injunction was granted by HH Judge K.W. Wong against the Respondent.  The Applicant was thus able to continue to use the Carparking Space pending determination of the Application.

Issues for the Present Hearing

6.  At the call-over hearing of the Summons mentioned, HH Judge K.W. Wong made an order, inter alia, that the hearing of the Summons shall also dispose of the Application entirely.

7.  At the commencement of the present hearing, the Applicant confirmed by her counsel, Mr Sio, that the plea for “estoppel by conduct” would not be pursued further.  At the conclusion of the hearing, it was submitted by Mr Sio that the claim for damages would not be pursued either.

8.  Below are the issues to be determined for the Summons and the Application to be disposed of together:-

(i)	Whether an owner of a carparking space, not being a resident or occupant of the building, could use it under Special Condition(27);
(ii)	For the matter mentioned in sub-paragraph (i), whether “occupant of the building or buildings” as stipulated in Special Condition (27)(a)(i) includes owner of a carparking space, but not an occupant of residential unit; and
(iii)	whether the Respondent as Manager of the DMC has the power to enforce the Government Lease under the DMC.

Applicant’s Case

Interpretation of Special Condition (27)(a)(i) 

9.  In his written submission, Mr Sio submitted on behalf of the Applicant that Special Condition 27(a) set out the requirement for the provision of carparking spaces and sub-paragraph (i) further stipulated the requirement of Car parking spaces for private residential units:

Car parking requirements	(27)(a)  In addition to the vehicle parking spaces as required by special Condition No. (12) hereof, spaces or car-ports or both shall be provided within the lot to the satisfaction of the Director:-
Car parking spaces for private residential units	(i)	for the parking of private motor vehicles at a rate of 1 space or car-port for every private residential unit or for every 110 square metres or part thereof of gross floor area for private purposes (whichever rate provides the lesser of such space) in the building or buildings erected or to be erected on the lot. The space so provided shall not be used for any purpose other than for the parking or private motor vehicles licensed under the Road Traffic Ordinance and belonging to the residents or occupants of the building or building erected or to be erected on the lot and their bona fide visitors or invitees;
Car parking spaces for Retail and Kindergarten Areas	(ii)	for the parking of 10 private motor vehicles belonging to the bona fide visitors of the Retail and Kingergarten Areas erected or to be erected on the lot; and
Visitor car parking spaces	(iii)	for the parking of 100 private motor vehicles registered under the Road Traffic Ordinance belonging to the bona fide visitors or invitees to the building or buildings erected or to be erected on the lot.

10.  Mr Sio argued that from the plain meaning of sub-paragraph (i), two categories of people have the right to use the carparking spaces, they are namely: “residents” or “occupants of the building”.

11.  It is submitted that the plain meaning of “occupant” is a person “who resides or is present in a house, vehicle, seat, etc., at a given time”; while “building” means “a structure with a roof and walls, such as a house or factory”.  Relying on the fact that the carparking spaces are built within the same structure of the residential blocks,Mr Sio submitted that carparking spacesare covered by “building or buildings”.  As a result, an owner of a carparking space is an occupant of the building, and is therefore entitled to use the carparking space.

12.  Further, I was referred to the definition of “occupier” and “building” in the DMC.  Mr Sio took “occupant” as synonym of “occupier” which is used in the DMC as below:

“Occupier”	An occupant or occupier of a Unit for the time being.
“Unit”	A Flat, a Commercial Unit, the Kindergarten, a Carparking Space, the Refuse Collection Point or the Public Vehicle Park to which Undivided Shares have been or will be allocated; and “his Unit” in relation to an Owner means the Unit or Units in respect of which the Owner has the full and exclusive right and privilege to hold, use, occupy and enjoy.

13.  On basis of the above definitions, it is submitted by Mr Sio that an owner of a carparking space,which is a unit by definition, is an occupier, and therefore is an “occupant of the building” under Special Condition (27)(a)(i) and is thus entitled to use the car parking space.

14.  In support of his contention, Mr Sio further submitted that the word “building” is used in various places in the Government Lease.  Special Condition (6), for example,provides that “The Grantee shall develop the lot by the erection thereon of a building or buildings complying in all respects with these Conditions and all Ordinance, by-laws and regulations…, such building or buildings to be completed and made fit for occupation on or before 30^th day of June, 2001”.  Hethen submitted that if the word “building” means only “Residential Blocks”, theeffect would be that the Government Lease would impose no requirement forareas outside the residential blocks like the carparking spaces and clubfacilities to be built in compliance with the laws.  It was said that therefore it was unreasonable for the word “building”to refer only to “residential blocks”.

15.  Further, Mr Sio borrowed the definition of “building” in theMulti-Storey Buildings (Owners Incorporation) Ordinance (Chapter 344) which was in force prior to the signing of the Government Lease, now it is renamed as the Building Management Ordinance:

(i)	In the 1970 edition, the statutory definition of building was:
	(a)	any building which consists of two or more levels, in­cluding basements; and
	(b)	the land upon which such a building is erected and any land in common ownership with such land;
(ii)	In 1993 edition, building means-
	(a)	any building which contains any number of flats comprising 2 or more levels, including basements or underground parking areas;

16.  He came to the conclusion from the above that it would be against common sense and meaning of the words if “building or buildings” include only the residential blocks but exclude the podium where carparking spaces are provided.

17.  Commenting on the submissions made by Ms Lee on behalf of the Respondent, Mr Sio pointed out that if, as contended by the Respondent, only private motor vehicles belonging to the residents could be parked at the carparking spaces, the words “occupants of the building or buildings” should have been deleted from Special Condition 27(a)(i).

18.  He further said that the sale of the carparking spaces was not confined residents of the Development but extended to others like the Applicant.  Mr Sio argued that from such incidents, no restriction or limitation on user was ever intended.

Power of the Respondent to Restrict the Use of Carparking Spaces

19.  It is not disputed that the Director of Land hadnever complained to the Respondent about using of the carparking spaces by non-residents.  It is Mr Sio’s contention that the rights and powers of the Manager are governed by the provision in the DMC.  Clause 6.2.1 is relevant:

“During the term of its appointment as the Manager, the Manager shall subject to clause 6.1.1 and 6.1.2 manage the Land and the Estate (save and except the Refuse Collection Point) in proper manner and in accordance with the provision of this Deed……”(Emphasis added)

20.  Mr Sio submitted that the Respondent can only act “in accordance with the provision” of the DMC and as the DMC does not restrict the use of carparking spaces by the Applicant, the act of Respondent is therefore plainly inconsistence of the DMC.

The Respondent’s Case

21.  On behalf of the Respondent, Ms Lee submitted that Special Condition (27) is a condition normally used in the land grants to tackle the problem of carparking spaces shortage in Hong Kong and is designed to ensure that the same are used only by residents of a development.

22.  She relied on a report “Car Parking in Private Residential Developments” published by the Consumer Council on 29 August 1997 in support of her such saying.  She said it showed that by creating this kind of condition in the land grant, it was purported that the carparking spaces were for use of residents or occupiers of residential or commercial units only, they were not meant to be used by an owner of those carparking spaces.

23.  She relied on the definitions in Longman English-Chinese Dictionary of Contemporary English, 1^st Editionfor the words below:-

(a)	“resident”: “a person who lives (in a place) and is not just a visitor居住者; 居民（遊客之對）”;
(b)	“occupant”: “a person who is in a certain place at a particular period of time 居住者; 佔用人”; and
(c)	“occupier”: “an OCCUPANT, esp. of a house居住者（尤指房屋）”.

24.  She contended that clearly the meaning of a person living in a place or house is implied in all these 3 words. The Applicant not living in the Development shall be excluded from Special Condition 27(a)(i).

25.  Further and in the alternative, she said, if the Applicant being a mere owner of the Carparking Space is allowed to use it, the limitation in Special Condition No.(27)(a)(i) would serve no purpose at all.  It must therefore not be its real intention.

26.  In conclusion she submitted that the Applicant being a non-resident nor an occupant of the residential units shall be excluded by virtual of Special Condition (27)(a)(i).

Discussion

Interpretation of Special Condition (27)

27.  It is not disputed that Special Condition (27) stipulated provision of car-parking space requirements.  By Special Condition 27(a)(i) the Grantee:

“shall provide car parking spaces for the parking of private motor vehicles at the rate of 1 space for every private residential unit or for every 110 square metres….”

28.  Then it went on to stipulate the restriction on users:

“The space so provided shall not be used for any purpose other than for the parking of private motor vehicles licensed under ….belonging to the residents or occupant of the building or buildings erected or to be erected on the lot and their bona fide visitors or invitees;”

29.  Mr Sio, argued that occupants of the building include owner of a carparking space who is not at the same time a resident or an occupant of a residential unit.  So according to his contention, the reading of the stipulation would have the effect of “The space so provided shall not be used for any purpose other than for the parking of private motor vehicles… belonging to the residents or occupant of the building including a car parking space”.

30.  I cannot agree with such interpretation.  It is clear that the real intention of Special Condition (27)(a)(i) was to qualify the use and users of the carparking spaces provided within the Development (paragraph 28 above).  The interpretation of Mr Sio would render the provision absurd.  It is not sensible to say “an occupant of the carparking space can use the car-parking space”.  The occupant of a carparking space is already using a parking space.  The statement does not make sense.  It could not serve the purpose of qualifying use or users.  The effect would be that whoever is an occupant of a carparking space can park in it.  It does not answer the question of who is entitled to use a carparking space which is the real intention of Special Condition (27)(i)(a).

31.  Mr Sio borrowed the definition of “building” in Cap 344 and submits that “building” includes car parking spaces, see paragraph 16 above.  When asked, Mr Sio could not explain why he referred to the outdated Cap 344 as an aid to interpret the word “building”.  I do not agree with him on this.  The cardinal presumption in interpretation is that the words of the agreement mean what the parties have in fact said, so that the words must be construed as they stand.  That is to say the meaning of the documents or of a particular part of it is to be sought in the document itself. (para 12-043, Vol 1 Chitty on Contracts31^stEdn.).

32.  In fact, there are different definitions of “building” in many other ordinances.  In Building Ordinance, Cap 123, for instance, building is defined as:-

“building (建築物) includes the whole, or any part, of any domestic or public building or building which is constructed or adapted for use for public entertainment, ………. and such other structures as the Building Authority may by notice in the Gazette declare to be a building.”

33.  With respect, if one makes reference to statutory definition for assistance, Cap 123 must be more relevant to the interpretation of a Government Lease than Cap 344 which concerns about management of multi-story buildings.  Under the definition of Cap 123 “building” includes “any part of a building” and is thus consistent with making reference only to “the residential part” when it says “occupant of the building” in Special Condition (27)(a)(i).  Having said that, I do not think I need to refer to Cap 123.

34.  I have no argument with Mr Sio’s interpretation of Special Condition No.(6) (see paragraph 15 above), but it does not mean that the same meaning must be adopted in interpreting Special Condition (27) when it would create an absurdity.

35.  I accept that the ordinary meaning of “building” is that as submitted by Mr Sio, which is “a structure with a roof and walls, such as a house or factory”.  It has long been accepted that the courts will not approach the task of construction with too nice a concentration upon individual words (para 12-044 Vol 1 Chitty on Contracts31^stEdn).  In the present case, the whole paragraph must be read to find out the meaning of “building”.  There is margin note written against sub-paragraph (i), it says “Car parking spaces for private residential units”.  In paragraph 12 of his written submission Mr Sio also said that “section 27 stipulates the Car Parking requirement in which sub-section (a)(i) further stipulates the requirement of Car parking spaces for private residential units”.  From the submission, it appears that he himself took the view that Special Condition (27)(a)(i) deals with Car Parking spaces for private residential units.  His saying that the word “building” includes also carparking spaces is, in the circumstances, contradictory and not convincing.

36.  A passage on effect of recitals in a document in paragraph 12-66 Vol 1 Chitty on Contracts31^st 34 Edn is helpful.  It says:

“When the words in the operative part of an instrument are ambiguous, the recitals and other parts of the instrument may be used to fix the appropriate meaning of those words. But clear words in the operative part of an instrument cannot be controlled by recitals.”

37.  Further, in Tai Fat Development (Holding) Co. Ltd v. The Incorporated Owners of Gold King Industrial Building CACV 297/2006, the appeal was directed to the trial judge’s conclusion in an application for summary judgment that 12 of the carparking spaces were not common areas within the meaning of the DMC.  This part of the appeal was allowed as the Court found an arguable case for the Plaintiff; but in the course of analysis,Tang V.P. expressed his viewin paragraph 26 that:

“We note the learned judge’s observation that common areas were allotted one share under the DMC.  We agree with the learned judge that the 62 shares allotted to the car parking spaces under the subheading of “Loading and Unloading Areas” could have been allocated to the common areas but this cannot override the fact that the disputed car parking spaces came under the description or sub-heading of “Loading and Unloading Areas”.

38.  Margin notes could be seen in various part of the Government Lease.  The main purpose must be for easy reference to different subjects stipulated therein.  They however also provide good guidelines and aides for understanding of the meaning of a paragraph as in the case of Special Condition (27)(a)(i). Against Special Condition (27)(a), there are altogether 4 margin notes, as could be seen from paragraph 9 above.  The first says “Car parking requirements” which is placed against the main paragraph of Condition 27(a).  As mentioned earlier, the margin note against sub-paragraph (i) is “Car parking spaces for private residential units”; the margin note against sub-paragraph (ii) is “Car parking spaces for Retail and Kindergarten Areas”; and lastly, the margin note against sub-paragraph (iii) is “Visitor car parking spaces”.  Such margin notes provide clear indication of the subject matter of the paragraph relevant to it.  Obviously, under the subject of provision of carparking spaces, such facilities are put under 3 categories to cater for needs arising from private residential units, retail and kindergarten areas and visitors.

39.  With the aid of the margin notes, I am of the view that the proper interpretation of “occupant of the building or buildings” refers to occupant of the part of the building which provides private residential units and does not include carparking spaces.  I find that under Special Condition (27)(a)(i) the carparking spaces are to be used by residents or occupant of residential units only.

40.  I do not agree with Mr Sio that the Applicant is allowed to use the carparking space by the DMC.  It is stipulated in clause 5.1.14 in section V of the DMC, under the heading “Covenants, Provisions and Restrictions to be Observed and Performed by the Owners that:

“No Owner shall use or permit or suffer any part of the Estate owned by him to be used except in accordance with the Conditions (the Government Lease as defined under clause 1.1 of the DMC), this deed or other Ordinances and Regulations or other permit, consent or from time to time applicable.”

41.  Further I agree with Ms Lee that the Government Lease overrides the DMC in case of inconsistencies.

Power to Enforce Breach of Government Lease

42.  It is the argument of the Applicant that the Respondent has no power to enforce the Government Lease even if the Applicant is in breach.  It is submitted that only a government authority endowed with the necessary power could enforce the same.

43.  I agree with Ms Lee’s submission that it is provided under Clause 6.2.1 of Section VI B of the DMC that:

‘During the terms of its appointment as the Manager, the Manger shall subject to clauses 6.1.1 and 6.1.2 manage the Land and the Estate…in a proper manner and in accordance with the provisions of this Deed and each Owner hereby irrevocably appoints the Manager as agent for all Owners in respect of any matters concerning the ……. Without in anyway limiting the generality of the foregoing the Manger shall have the following duties:-
(26)	To take all precautions to prevent and to take action to remedy any breach by any Owner or other persons residing in or visiting the Estate of any provisions of the Conditions or this Deed.
(35)	To enforce the due observance and performance by the Owners or any person occupying any part of the Estate through under or with the consent of any such Owner of the terms and conditions of this Deed. …
(43)	To do all such other things as are reasonably incidental to the proper management of the Land and the Estate in accordance with the Conditions or this Deed or for the common benefit of the Owners.

Conclusion

44.  From the above analysis, I am of the view that in the proper construction of Special Condition (27)(a)(i), only the residents or the occupants of the residential units are entitled to use the carparking spaces.  Owner of a carparking space is not meant to be taken as an occupant of the building.

45.  Further I am of the view that by virtue of Clause 6.2.1 of Section VI B of the DMC, the Respondent, as the DMC Manager is entitled to enforce against person(s) in breach of the Government Lease.

46.  For the above reasons, I dismiss the Summons and the Application.

47.  Lastly, I am satisfied that if not restrained by a court order, the Applicant will continue to use the carparking space.  I enter judgment for the Counterclaim in the term set out below.

48.  I see no reason why costs should not follow the event.  I order that the Applicant do pay the Respondent the costs of the Application and the Summons, to be taxed at District Court scaleif not agreed.  This is an order nisi to become absolute within 14 days if no application is taken out to vary the same.

Order

49.  My order is as below:-

(1)	The Summons and the Application are dismissed;
(2)	The interim injunction imposed per HH Judge K.W. Wong’s order dated 16 January 2014 is set aside;
(3)	An injunction to restrain the Applicant whether by herself; her licensees, bona fide visitors or invitees from parking and motor vehicle in the Carparking Space unless any of them becomes a resident or occupying in any residential unit of the Development;
(4)	The Applicant do pay the Respondent the costs of this application as set out in paragraph 48 above; and
(5)	Penal Notice.