JADE’S REALM LTD v. DIRECTOR OF LANDS for and on behalf of THE GOVERNMENT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION

HCA 1509/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1509 OF 2012

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J U D G M E N T

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Introduction

1. There are before this court two applications by the Plaintiff.

2. First, by summons dated 13 December 2013, the Plaintiff seeks to strike out paragraph 12(2)(e) of the Amended Defence under RHC O18 r 19(1)(a) on the ground that it discloses no reasonable defence. Paragraph 12(2)(e) of the Amended Defence reads as follows:

  “Further or alternatively, the title of the colonial Hong Kong Government over the land in the New Territories, of which the Lots form part, was only for a 99-year term under the Peking Convention from 1 July 1898 to 30 June 1997. Whatever period of adverse possession that the Plaintiff’s predecessors-in-title managed to accumulate against the colonial Hong Kong Government, the same came to an end upon expiry of the 99-year term on 30 June 1997. It is averred that any period of adverse possession that the Plaintiff’s predecessors-in-title and the Plaintiff have accumulated since 1 July 1997 is less than the required 60 years.” (“99-year term argument”)

3. Second, by summons dated 23 July 2014, the Plaintiff seeks a determination of the following issues of law under RHC O 14A r 1:

(1)  Whether, as a matter of municipal law of Hong Kong, the “title” of the colonial Hong Kong Government over land in the New Territories was for a term of 99 years expiring on 30 June 1997.

(2)  Whether, in respect of unleased Government land situated in the New Territories, any period of adverse possession under section 7 (1) of the Limitation Ordinance accumulated prior to 1 July1997, insofar as the same falls short of 60 years, needs to be counted afresh since 1 July 1997.

(collectively “Two Questions”)

Background

4. The background of this case and the parties’ competing contentions have been summarized in a judgment of this court handed down on 9 January 2015 (“Judgment”) and shall not be repeated here.  For ease of comprehension, suffice it to say that the principal allegation of the Plaintiff is that its predecessors-in-title of Lots Nos. 355 and 356 in DD 214 (“the Lots”) and itself have been in adverse possession of a piece of Government land in DD 214 (“Land”) in Nam Wai, Sai Kung, New Territories which adjourns the Lots “since not later than 1937 and further the colonial Hong Kong Government and the Hong Kong SAR Government have been dispossessed of the same, or have abandoned any claim to the Land”: paragraph 10 Amended Statement of Claim.

5. In the prayer for relief, the Plaintiff claims inter alia a Declaration that the Defendant’s title of and in the Land has been extinguished by virtue of the Limitation Ordinance.

6. The 99-year term argument is pleaded by the Defendant as one of the responses to the Plaintiff’s claim of adverse possession of the Land.

Striking Out Application

7. It is well-established that the court should exercise its summary power to strike out any pleading only in plain and obvious cases. The court should not decide difficult points of law in striking out proceedings. The claim or defence must be obviously unsustainable, the pleadings unarguably bad and it must be impossible, not just improbable, for the claim or defence to succeed before the court will strike it out: Hong Kong Civil Procedure 2015 Vol. 1 para. 18/19/4.

8. Section 7(1) of the Limitation Ordinance, Cap. 347, stipulates that:

“No action shall be brought by the Crown to recover any land after the expiration of 60 years from the date on which the right of action accrued to the Crown or, if it first accrued to some person through whom the Crown claims, to that person.”

9. Put it simply, the 99-year term argument runs like this:

(1)  As a matter of Hong Kong law, the title of the Colonial Hong Kong Government, or, strictly speaking, the British Crown, over New Territories land was a leasehold title of a 99‑year term, expiring on 30 June 1997 (“1^st Limb”).

(2)  Whatever period of adverse possession the Plaintiff's predecessors-in-title had managed to accumulate against the Colonial Hong Kong Government or the British Crown as lessee of the Land came to an end on 30 June 1997 when the lease itself expired (“2^nd Limb”).

10. If both limbs of the 99-year term argument are valid, then the period of adverse possession over the Land by the Plaintiff’s predecessor-in-title vis-à-vis the Colonial Hong Kong Government or the British Crown would not count against the HKSAR Government - it must be counted afresh from 1 July 1997 and, obviously, such period is far less than 60 years. Putting it in another way, for the purpose of section 7(1) of the Limitation Ordinance, the right of action which accrued to the Colonial Hong Kong Government to recover the Land is different from the right of action which accrued to the HKSAR Government – such right only first accrued to the latter on 1 July 1997 when it began to manage all land within the HKSAR as State Property under Article 7 of the Basic Law. Again, self-evidently, much less than 60 years have elapsed since the right of action to recover the Land first accrued to the HKSAR Government on 1 July 1997.

11. Hence, whichever way one puts it, the Plaintiff’s claim that the HKSAR Government’s title of and in the Land has been extinguished by the Limitation Ordinance fails.

12. In Winfat Enterprises (HK) Co Ltd v AG [1984] HKLR 32, the Court of Appeal, after examining the Peking Convention of 9 June 1898, the Order-in-Council of 20 October 1898, the two Governor’s proclamations of 9 April and 12 July 1899, the New Territories Regulation Ordinance (No. 12 of 1899) which came into force on 18 April 1899, sections 2 and 13 – 15 of the Land Court (New Territories) Ordinance (No. 8 of 1900) which came into force on 28 March 1900, sections 2, 13 ‑ 15[1] of the New Territories Land Court Ordinance (No.18 of 1900) which repealed and re-enacted Ordinance No. 8 of 1900 and came into force on 23 July 1900, section 14 of the New Territories Regulation Ordinance (No.34 of 1910) and section 8[2] of the New Territories Ordinance, Cap. 97, came to this conclusion at 51E-F:

“Whatever the position with regard to interest in land may have been, between the assumption by the Crown of sovereignty over the New Territories on 1^st July 1898, and the coming into force of the ordinance of No. 8 of 1900 on 28^th March 1900, it seems to us that, as far as domestic law is concerned, all land in the New Territories became the property of the Crown, for the period of 99 years specified in the Peking Convention, by virtue of s. 15 of that Ordinance.”

13. The Court of Appeal’s decision was affirmed by the Privy Council: see [1985] 1 AC 733. At 745A-B, Lord Diplock observed that:

“When the New Territories were ceded, the land became on 1 July 1898 the property of the British Crown for the 99-year period of the cession. It was declared to be so by the Land Court (New Territories) Ordinance 1900 (No. 8 of 1900).”

14. This case, in my view, is authority for the following propositions:

(1)  As far as Hong Kong law is concerned, all land in the New Territories had been vested in the British Crown by statute, the first of which was section 15 of Ordinance No.8 of 1900 which was re-enacted by section 15 of Ordinance No. 18 of 1900.

(2)  As a matter of Hong Kong law, the interest of the British Crown or the British Crown in right of the Colonial Hong Kong Government in New Territories land was a leasehold interest for a term of 99 years from 1 July 1898.

15. In my judgment, the 1^st Limb of the 99-year term argument is supported by high authorities binding on this court and must be accepted as valid for the present purpose. For completeness, it was also accepted as valid by Deputy High Court Judge L Chan (as he then was) in Chau Ka Chik Tso & Ors v the Secretary for Justice unrep.; HCA 10670 of 2000; 30 December 2009. At paragraph 229, the learned Judge said:

“The intention of these enactments [New Territories Order in Council, section 15 New Territories Land Court Ordinance 1900, section 14 New Territories Regulation Ordinance No. 34 of 1910, section 8 New Territories Ordinance] was to incorporate the New Territories as part of the then British Colony of Hong Kong from 23 July 1900. But I cannot see any intent in the enactments to vest the New Territories in the British Crown in perpetuity as for the rest of the colony. I do not read the dropping of the reference to the term in the Peking Convention as a sufficient manifestation of intent of the legislature to treat the New Territories as having been vested in the British Crown in perpetuity. Though the Peking Convention was no part of the domestic law of Hong Kong, it was a treaty that the British Crown had to observe. There is no evidence that the British Crown did not observe the convention. The British Hong Kong Government also did not conduct itself as if the New Territories had been so vested in the British Crown but not just for the period specified in the Convention…”

16. The 2^nd Limb of the 99-year term argument is also supported by Chau Ka Chik Tso & Ors v the Secretary for Justice supra. At paragraph 226, Deputy High Court Judge L Chan recited the defendant’s following submission with approval:

“226. If the occupation of the DAs by the plaintiffs and their predecessors amounted to adverse possession, then the title of the British Hong Kong Government to the DAs would have been defeated by the plaintiffs and their predecessors at the latest by November 1984. The defendant however submitted that the title of the British Hong Kong Government over land in the New Territories was only a 99‑year interest under the Peking Convention running from 1 July 1898 to 30 June 1997. Upon expiry of this interest, the reversionary interest of the Chinese Government fell into possession on 1 July 1997. When the reversionary interest fell into possession, the limitation period started to count afresh. This submission appears to be correct. But it is disputed by the plaintiffs…” (emphasis added)

17. After dismissing the plaintiffs’ contentions based on the New Territories Order in Council, section 15 New Territories Land Court Ordinance 1900, section 14 New Territories Regulation Ordinance No. 34 of 1910, section 8 New Territories Ordinance at paragraph 229 (quoted above), the learned Judge then dealt with the plaintiffs’ various other submissions based on Paragraph 3(5) and Annex III of the Joint Declaration, Articles 8, 18, 105 and 160 of the Basic Law, the Hong Kong Reunification Ordinance etc. and concluded that none of them assisted the plaintiffs in that case. Of particular importance for the present purpose is the Judge’s observations at paragraphs 235 – 237, as well as 245 – 246 which I find persuasive:

“235. The plaintiffs also referred to the Reunification Ordinance which recognized that rights and liabilities of the British Crown or the British Hong Kong Government, which were vested or accrued before 1 July 1997, will continue and will be actionable on and after 1 July 1997 so as to effect a seamless transition of holding of property in Hong Kong. They disputed the defendant’s proposition that the HKSAR has the right to recover the DAs which accrued on 1 July 1997. They in particular referred to section 30 of the Reunification Ordinance which provides:

‘(1) For the avoidance of doubt, it is declared that all property, rights and liabilities vested in or belonging to the Crown or the Government of Hong Kong immediately before 1 July 1997 have been on and from that date, subject to the Basic Law, vested in or transferred to the Government of the HKSAR…

   …

   (5)  In this section- 

‘Crown’ (官方) means the Crown in right of the Government of Hong Kong.’

236.  However, this section of the ordinance only provided for the inheritance by the HKSAR Government of all rights and liabilities of the British Hong Kong Government.  The interest of the British Hong Kong Government over the New Territories was derived from the Peking Convention and it had expired on 30 June 1997.  It did not devolve upon the HKSAR Government.  Though the leases of New Territories land had been extended by the Extension Ordinance, there was a change of lessor from the British Hong Kong Government to the HKSAR Government on 1 July 1997.  There was of course the desire to ensure a seamless transition of all legal rights and obligations including property rights from the old regime to the new one, but it was not an extension of the expired interest into the new regime.  The rights of the HKSAR Government to the new leases in the New Territories are derived from Article 7 of the Basic Law.

237.  Article 7 of the Basic Law provides:

‘Article 7

  The land and natural resources within the Hong Kong Special Administrative Region shall be State property.  The Government of the Hong Kong Special Administrative Region shall be responsible for their management, use and development and for their lease or grant to individuals, legal persons or organizations for use or development.  The revenues derived therefrom shall be exclusively at the disposal of the government of the Region.’

…

245.  However, this argument [that the Plaintiffs’ rights to a possessory title under the previous laws do continue to be valid and be recognized and protected by the Government of the HKSAR under Article 160 of the Basic Law] is only valid if the rights of the British Crown in the New Territories had, despite the Peking Convention, continued after 30 June 1997…The interests of the British Crown in the New Territories expired on 30 June 1997.  The interest of the plaintiffs in the DAs likewise ended on this day. Article 160 is to preserve the legal validity of rights and obligations of the previous regime, not to extend rights and obligations which expired at the resumption of sovereignty by the Chinese Government.

246.  The plaintiffs also submitted that there should be no distinction in the application of the Limitation Ordinance to the New Territories on the one hand and to Hong Kong Island and New Kowloon on the other.  They referred to the defendant’s stance that the British Hong Kong Government’s interest in land in the New Territories ended on 30 June 1997 and did not continue thereafter.  They said that it produced a different result for adverse possession against the Government in the New Territories from that in the Hong Kong Island and New Kowloon…However, I am of the view that the difference in the result of adverse possession in the New Territories from that for the rest of the HKSAR is not the result of any distinction in the application or interpretation of the Limitation Ordinance.  The difference came about because of the different tenure of the British Crown in the New Territories from that in the rest of Hong Kong.” (emphasis added)

18. It should be noted that the actual decision of Deputy High Court Judge L Chan was reversed on appeal. But, as recorded in paragraph 1 of the judgment of Rogers V-P, the Plaintiffs’ argument based on adverse possession was abandoned: [2011] 2 HKLRD 387, 390-1.  As a result, the validity of the 99-year term argument was not directly examined by either the Court of Appeal or the Court of Final Appeal: see (2011) 14 HKCFAR 889.

19. It seems to this court that the acceptance by Deputy High Court Judge L Chan of the 2^nd Limb of the 99-year term argument is sound in principle.

20. As explained by Lord Hoffmann NPJ in Chan Tin Shi & Ors v Li Tin Sung & Ors (2006) 9 HKCFAR 29 at [16], [17] and [20]:

“16. .…adverse possession by a squatter for the period of limitation will bar the right which the person entitled to possession has to recover the land by action. This principle is reflected in s.7(2) of the Limitation Ordinance:

‘No action shall be brought by any…person to recover any land after the expiration of [20] years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person…’

17. As is plain from the language of the Ordinance, adverse possession does not affect the rights of other persons having interests in the land which do not entitle them to possession. In the case of land subject to a lease, the person entitled to possession is the lessee. The freeholder has no right to possession until the lease comes to an end. Adverse possession by a squatter may therefore bar the remedy of the lessee but will not affect the right of the freeholder to claim possession when the lease falls in.

…

20. It follows from these well established principles that when the period of limitation expired, the lessee of the land occupied by a squatter was barred by s.7(2) from bringing proceedings for possession and his title was, as against the squatter, extinguished by s.17. This did not however affect the interest of the government, against which time could not commence to run while the leasehold interests subsisted. As between the government and the lessees, the lease continued to subsist, notwithstanding the expiry of the limitation period. It follows that if the Extension Ordinance had not been passed the government would have been able, by virtue of its superior interest, to claim possession from the squatter when the lease expired in 1997.” (emphasis added)

21. It follows from Chan Tin Shi & Ors v Li Tin Sung & Ors supra that, as a matter of legal principle, any period of adverse possession over land in the New Territories prior to 30 June 1997 accumulated against the Colonial Hong Kong Government or the British Crown would count only against them, and no one else, for the purpose of the Limitation Ordinance. It was only as from 1 July 1997, after the British Crown’s leasehold interest in New Territories land had ceased, that the land reverted back to the Chinese Government who then has become entitled to possession of it as against inter alia squatters, past and present.

22. My aforesaid view is in no way undermined by the arguments put forward by Mr Chong.

23. At paragraph 12 of his skeleton, Mr Chong submits that “The result of the aforesaid enactments [New Territories Order in Council of 1898, New Territories (Land Court) ordinance of 1900, New Territories Regulation Ordinance of 1910] are that all unleased Crown land in the New Territories was considered by Hong Kong law as being vested in the Crown in perpetuity as if they had originally formed part of the colony albeit ‘…during the term specified in the Convention…’.  This is the effect of the Order in Council and domestic legislation but not the result of a landlord and tenant relationship having been established involving the colonial Hong Kong Government as a tenant.” (emphasis added)

24. I do not accept this argument. With respect, the argument that all unleased Crown land in the New Territories was vested in the Crown “in perpetuity albeit during the term specified in the Peking Convention” is a contradiction in terms and is completely illogical. The argument is also contrary to the clear authority of Winfat Enterprises (HK) Co Ltd v AG supra.

25. At paragraph 15 of his skeleton, Mr Chong, after reciting section 8 of the New Territories Ordinance, submits that “The change of the material wordings of the statute and the deliberate removal of the phrase ‘during the term specified in the said Convention’ constituted an implied repeal of the earlier statutes directly on this point and, in the premises, the effect of s.8 of the New Territories Ordinance 1911 was that the vesting of all land (inclusive of unleased Crown land) in the Crown in perpetuity would be unrestricted and unqualified (by the 2^nd Convention of Peking of 1989 as to duration).” At paragraph 16 of his skeleton, Mr Chong submits that this construction is fortified by section 8 of the 1998 New Territories Ordinance.

26. I do not accept this argument. With respect, Mr Chong is merely repeating the same argument raised by the plaintiffs in Chau Ka Chik Tso & Ors v the Secretary for Justice supra and rejected by Deputy High Court Judge L Chan at paragraph 229. Like the learned Judge, I cannot discern any intent in the New Territories Ordinance to vest the New Territories in the British Crown in perpetuity as for the rest of Hong Kong.  Nor do I read the dropping of the reference to “the term specified in the Peking Convention” as a sufficient manifestation of the Legislature’s intent to treat the New Territories as having been vested in the British Crown in perpetuity. 

27. To conclude, as this is a striking out application, it is not necessary for this court to come to a firm and final view on the validity of the 99-year term argument. Suffice it to say, in my judgment, the Plaintiff has failed to show that the argument is obviously unsustainable, unarguably bad or that it is impossible for this argument to succeed. In these circumstances, the Plaintiff’s first application fails.

O 14A Application

28. The Defendant’s objections to the application are three-fold:

(1)  first, the application is barred by RHC O 77 r 7 (1)(c);

(2)  second, the use of O 14A procedure is inappropriate in the circumstances of this case;

(3)  third, the Court ought not, in the exercise of its discretion, make a determination under O 14A.

29. The first objection is straightforward.

30. RHC O 77 r 1(1) provides:

“(1) These rules apply to civil proceedings to which the Crown is a party subject to the following rules of this Order.”

31. By virtue of section 2 of Schedule 8 of the Interpretation and General Clauses Ordinance, Cap. 1, as amended by section 6 of the Hong Kong Reunification Ordinance, any reference to “the Crown” should be construed as a reference to the “Government of the Hong Kong Special Administrative Region”.As a result, the phrase “civil proceedings to which the Crown is a party” means “civil proceedings to which the Government of the Hong Kong Special Administrative Region is a party”.

32. Further, RHC O 77 r 1 (2) provides:

“(2) In this Order

  ‘civil proceedings to which the Crown is a party’ has the same meaning as it has for the purposes of Part V of the Crown Proceedings Ordinance (Cap. 300) by virtue of section 2 (4) of that Ordinance.”

33. Section 2(4) of the Crown Proceedings Ordinance, Cap. 300 (“CPO”) extends the definition of “civil proceedings to which the Crown is a party” as follows:

“Any reference in Part IV or V of this Ordinance to civil proceedings by or against the Crown, or to civil proceedings to which the Crown is a party, shall be construed as including a reference to civil proceedings to which the Secretary for Justice, or any Government department, or any officer of the Crown as such, is a party.” (emphasis added)

34. In these proceedings, the Plaintiff is suing “Director of Lands for and on behalf of the Government of the Hong Kong Special Administrative Region” as Defendant. Hence, these proceedings are ex facie civil proceedings to which “the Crown” ie the Government of the Hong Kong Special Administrative Region, alternatively, “any officer of the Crown” ie the Director of Lands is a party. Either way, the rules under RHC O 77 are applicable to the present proceedings.

35. RHC O 77 r 7(1)(c) provides that “No application shall be made against the Crown  …

“(c) under Order 14A, rule 1 in any proceedings by or against the Crown.”

36. Mr Mok submits that r 7(1)(c) is an absolute bar against the making of an Order 14A application in the present proceedings. I agree.

37. In his supplemental skeleton, Mr Chong submits that RHC Order 77 “was made as a procedural rule concerning ‘Crown Proceedings’ ”. Whilst since 1 July 1997, reference to the “Crown” is deemed to be a reference to the “HKSAR Government”, CPO only applies to proceedings against the HKSAR Government in its “official capacity” and it is only in such proceedings that CPO confers certain privileges on the HKSAR Government. He submits the present proceedings are not “Crown Proceedings” in that the HKSAR Government is sued in its “private capacity as landowner” and this is the reason for the Plaintiff to sue the Director of Lands as the HKSAR Government’s land agent.

38. I do not agree. While it is true that the rules under Order 77 are devised to give effect to the CPO (see Hong Kong Civil Procedure 2015 Vol. 1 paragraph 77/0/2 and section 30 CPO), I am not persuaded that proceedings covered by Order 77 are limited to proceedings against the HKSAR Government in its “official” capacity.

39. First, Mr Chong’s submission is unsupported by authorities.

40. Second, Mr Chong’s submission is unsupported by the wording of the CPO.

41. For instance, in section 2(2) of CPO, “civil proceedings” are defined so as to exclude “proceedings of a nature such as in England are taken on the Crown side of the Queen’s Bench Division of Her Majesty’s High Court of Justice” - in other words, proceedings concerning criminal and prerogative jurisdiction: Wong Tsz Jam v Commissioner of Police [2008] 5 HKLRD 164 at [44] – [46]. There is nothing in section 2(2) which further excludes from the ambit of CPO proceedings against the HKSAR Government in its “private capacity as landowner”.

42. Similarly, section 10 of CPO provides:

“Subject to the provisions of this Ordinance, all such civil proceedings by or against the Crown as are mentioned in the First Schedule are hereby abolished, and all civil proceedings by or against the Crown in the Supreme Court[3] shall be instituted and proceeded with in accordance with rules of court.”

43. Again, the section does not draw a distinction between civil proceedings against the HKSAR Government in its “private capacity as a landowner” as opposed to its “official capacity”.

44. Lastly, civil proceedings against the Crown for the recovery of land is specifically dealt with under Proviso (b) of section 16 (1) CPO which states: “the court shall not make an order for the recovery of the land…but may in lieu thereof make an order declaring that the plaintiff is entitled as against the Crown to the land”.  Ex hypothesis, such proceedings are apt to include proceedings in which the Crown is sued in its capacity as “landowner” for otherwise, it is difficult to see how proceedings can be instituted to recover land from the Crown at all.

45. For all these reasons, I am satisfied that RHC O 77 r 7(1)(c) is applicable in the present case and bars the application under O 14A. On this ground alone, the Plaintiff’s application should be dismissed.

46. The Defendant’s second and third objections can be dealt with together.

47. RHC O 14A(1) provides:

“(1) The Court may upon the application of a party or of its own motion determine any question of law or construction of any document arising in any cause or matter at any stage of the proceedings where it appears to the Court that–

(a) such question is suitable for determination without a full trial of the action; and

(b) such determination will finally determine (subject only to any possible appeal) the entire cause or matter or any claim or issue therein.” (emphasis added)

48. As Rogers VP observed in Netwell Properties Ltd v JCG Finance Co Ltd [2004] 2 HKLRD 138 at [6]:

“...the Order 14A procedure is one to determine a question of law or construction of a document which arises in an action where the question is suitable for determination without a full trial of the action and the determination would finally determine the entire cause or matter of the claim. If there is a dispute as to the facts, it is difficult to see how judgment can be entered in favour of a claimant. Where a claimant seeks judgment under Order 14A the facts would have to be based on either established facts or agreed facts. As set out in the Hong Kong Civil Procedure 2002 Vol. 1 at pp. 178-179 at paragraph 14A/2/4, there should be no hypothetical facts and where the issues of fact are interwoven with the legal issues raised, it will be undesirable for the court to split the legal and factual determination, for to do so would in effect be to give legal rulings in vacuo or on a hypothetical ruling, which the court will not do.” (emphasis added)

49. In my view, the Two Questions are not suitable for determination without a full trial, and a determination of the Two Questions will not finally determine the entire cause or matter nor even an issue therein.

50. As can be seen from paragraphs 11 to 17 of the Judgment, the parties are in dispute on inter alia (i) the correct boundaries of the Lots, and hence, the correct delineation of the Land; and (ii) the time(s) from which the Plaintiff’s predecessors-in-title commenced the alleged adverse possession of the Land or parts thereof. These are factual disputes which can only be resolved at trial. Unless and until these factual disputes are resolved, it is not possible to finally determine the core issue raised in paragraph 12 of the Amended Defence ie whether the Plaintiff and its predecessors-in-title have been in adverse possession of the Land for 60 years so as to extinguish the HKSAR Government’s title to the Land.

51. Further, even with the resolution of these factual issues and the determination of the Two Questions, it is still not possible to finally determine the core issue of adverse possession, a fortiori, the whole cause or matter resulting in a judgment in favour of the Plaintiff or the Defendant.This is because, as submitted by Mr Mok in his skeleton, subsumed within this issue of adverse possession are the following sub-issues raised in paragraph 12(2) of the Amended Defence ie:

(1)  Whether the Plaintiff's predecessors-in-title have acknowledged the HKSAR Government's title in respect of the Land.

(2)  The dispute as to the time(s) when the Houses and Structures were built.

(3)  Whether the occupation of some of the Houses and Structures was allowed by the Squatter Control Unit.

(4)  The 99-year term argument.

52. In my judgment, determination of the Two Questions now:

(1)  will not finally determine all the sub-issues under adverse possession;

(2)  will not result in a final determination of the cause or matter of the Plaintiff’s claim since adverse possession is only one of the five principal issues in these proceedings; and

(3)  will likely lead to appeals, more delay and expenses than if the whole matter is to be decided in one go at trial.

53. In this regard, I would respectfully echo the words of Recorder Ma SC (as he then was) in Rockwin Enterprises Ltd v Shui Yee Ltd [2003] 3 HKC 174 at paragraph 25(a):

“The court can take an overall view of the matter to see the context in which the question arises. If the court is of the view that there would not be a great saving of time or costs in determining the question...this would be a factor against adopting the O 14A procedure. For example, if the question involves an issue that is not determinative of the action or is but one of many issues or which may at the end of the day be an academic one, a court may well not embark on a determination under O 14A. In such situations, it may be that a determination by the court leading possibly to appeals at two further levels, will result in more delay and expense to the parties than if the whole matter was decided at one go at trial.”

54. In my view, there is little saving of time or costs in determining the Two Questions under the O 14A procedure. Instead, given the potential importance of the questions, for this court to do so may well lead to appeals to the highest level resulting in substantial delay in the resolution of the entire cause or matter and expenses to the parties. That is clearly inimical to the objectives of the O 14A procedure as well as the objectives of the Rules of High Court in inter alia promoting a sense of reasonable proportion and procedural economy in the conduct of proceedings and ensuring the resources of the Court are distributed fairly. 

55. In these circumstances, even if I am of the view that O 77 r 7(1)(c) is not an absolute bar to the O 14A application, I would, in the exercise of my discretion, decline to determine the Two Questions under O 14A.

Disposition and Costs order nisi

56. This court hereby dismisses the two summonses of the Plaintiff.

57. There shall be an order nisi that costs be to the Defendant, to be taxed if not agreed, with certificate for Counsel and paid forthwith.