KWONG SHOOK LING v. THE OCCUPANTS OF LOT NO. 841 IN SURVEY DISTRICT NO. 3, SAI KUNG, NEW TERRITORIES AND ANOTHER

HCMP 2859/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 2859 OF 2003

_______________________

______________________

______________________

________________

J U D G M E N T

________________

Introduction

1.  In this action, the plaintiff claims possession and mesne profits of a piece of land in Cha Kwo Ling, of which her deceased husband Mr Yu King Kwok (“Yu”) was the registered owner, and the 2^nd defendant claims adverse possession of the land.

2.  The land is known as Lot 841 in New Kowloon Survey District No 3, Sai Kung, NT (“Lot 841”).  It was not really disputed that at the time when Yu acquired Lot 841, there were altogether 5 houses in a row on Lot 841 and they were numbered 127, 129, 131, 133 and 135 on Cha Kwo Ling Main Street.  The 4 houses numbered 127, 129, 131, and 133 were within Lot 841 (“collectively 4 Houses”), while the 5^th house numbered 135 was partly within Lot 841 and partly outside.  The old street numbers 127, 129, 131, 133 have been re-numbered.

3.  The parties have respectively instructed their own Authorised Land Surveyor to conduct a survey of Lot 841 and in relation to its occupation history.  P’s expert is Mr Helicon Ma (“Mr Ma”), and D2’s expert is Mr Leung Shou Chun (“Mr Leung”).  The experts agreed that basically there are now 6 structures/houses on Lot 841 numbered 126A, 127, 127A, 127B, 133 and part of 135 and there is a courtyard/open space in between the structures nos 127A, 133 and 135[1].  The respective position of those structures/houses is not disputed. 

4.  The area of Lot 841 as seen in the Crown Lease was 0.03 acre[2], which is about 121.4 sq m[3], or about 1,306.8 sq ft.

5.  The present action was commenced under Order 113 of the Rules of the High Court by the plaintiff (“P”) as executrix of the estate of Yu.  A possession order was obtained by her on 29 September 2003 against the then sole defendant, namely unknown occupiers of the Lot 841 (“Possession Order”).

6.  The Possession Order was set aside over 9 years later, on 22 March 2013, upon an application by an intervener, Mr Ngan Cheung Wah, and leave was given for Mr Ngan to join as the 2^nd defendant (“D2”), on the ground that the Possession Order was irregular due to there being no effective service of process or the service had failed to bring the action to the notice of the occupiers.

7.  Counsel Mr Mok Yeuk Chi appeared with Mr Gary Lam on behalf of P in this trial and Counsel Mr Roy Lau appeared on behalf of D2.

Brief background

8.  Yu acquired Lot 841 from one Wong Shiu Wing (“Wong”), the administrator of the estate of a Madam Chan Kiu (“Madam Chan”) on 9 January 1973 at a consideration of HK$300,000.  The purchase was subject to existing monthly tenancies[4] and the tenants and their respective rental were:

(a)   Tin Shing Ho (天成號)  HK$95 per month

(b)   Tin Shing Charn (天成棧)  HK$100 per month

(c)   Tse Hung (謝洪)  HK$95 per month

(d)   Kam Hong Leung (錦康龍)  HK$95 per month

(e)   Wah Kee (華記)  HK$95 per month

9.  According to P, Yu’s family was in property development business for many years through a number of companies which were responsible for developing and selling properties.  In particular, Yu and his father had through their company bought a lot of Letter Bs for investment.  Further, Yu himself was an experienced property investor and he had bought over 300 lots of land in various parts in Kowloon and New Territories to form a land bank[5].

10.  Prior to acquiring Lot 841, in 1972, Yu had bought another lot, which was several hundreds of meters away (walking distance 5-10 minutes) namely sub-section 4 of Section A of Lot No 622 in New Kowloon Survey District No 3 (“Lot 622”).

11.  P said apart from Lot 841 and Lot 622, Yu had also bought other lots in Cha Kwo Ling and Lei Yu Mun for rent collecting purpose.

12.  According to P, Yu was very hard working and that he would collect rent himself and P would accompany him over weekends. Her family emigrated to Australia in 1987-1988 and that she and Yu would spend about half of their time each year in Australia and the other half in Hong Kong.  Even though there was the parties’ son and also staff to help Yu in dealing with Yu’s property business in Hong Kong, when Yu was in Hong Kong, he would go personally to all his lots to collect rent and to inspect.   It was P’s evidence that whenever she was in Hong Kong every year or every other year, she would accompany Yu once or twice to collect rent. 

13.  It was not disputed that after the winter festival in December 1983 there was a big fire in Cha Kwo Ling (“1983 Fire”) and the houses on Lot 841 were destroyed, and Lot 841 was in ruins.

14.  It was also not disputed that in January 1985, Yu had requested for a setting out plan of Lot 841 from the District Lands Office.  This resulted in a survey being commenced by the Survey Officer of Lands on 23 January 1985 (“1985 Setting Out Survey”) and the boundary was set on 12 February 1985.  The boundary lines and corners were shown to a Mr Ngan Po Wai, a representative of Mr Ng Chi Chai (“Mr Ng”), the Authorised Person/Architect appointed by Yu, at that time, and a report was subsequently prepared by the Survey Officer of Lands on 6 March 1985. (“1985 Setting Out Report”)[6].

15.  It was P’s case that in about 1986, part of Lot 841 was rented out by Yu to a former tenant of one of the stone houses on Lot 841 until some time towards end of 1990s.

16.  In 2000, Yu was found to have cancer, and his health deteriorated.  The last time P recalled having gong to Lot 841 with Yu was around 2000 before he was diagnosed with cancer.  According to P, at that time, there were some basic buildings on Lot 841, and there were some canopies underneath of which there were some old and ruined stalls and wooden chairs, left by the tenant.  There was no sign of occupation by any one.

17.  After Yu passed away in March 2002, P instructed solicitors to apply for probate.  In July 2002, her solicitors Wilkinson and Grist had instructed a firm of surveyors called Lawson David & Sung Surveyors Limited (“Lawson David”) to value the 300 old pieces of land owned by Yu for the purpose of stamp duty. 

18.  A valuation report was later prepared by Lawson David on 23 October 2002 (“Valuation Report”) after a site inspection by its Land Consultant, Mr Tse Kwok Hing (“Mr Tse”) on 3 September 2002.

19.  It was during the site inspection on 3 September 2002 (“03.09.02 Inspection”) that Tse discovered signs of occupation on Lot 841 and duly informed P.  P said she then discovered that part of the Lot 841 was occupied by temporary structures by persons unknown without any tenancy or permission from Yu or P. 

20.  P said she was advised that she had to obtain probate of Yu’s estate first before she could take legal action.  Eventually, on 3 July 2003, P commenced the present action, and as mentioned earlier, she obtained the Possession Order against D1 in September 2003.  Prior to obtaining the Possession Order, Mr Tse was instructed to prepare an updated valuation of Lot 841 and Mr Tse had carried out a second site inspection on 3 September 2003 (“03.09.03 Inspection”) and took photographs, and again Mr Tse found signs of occupation on Lot 841, as before.

21.  P’s evidence was that she was advised that she had 12 years to apply for execution of the Possession Order.  P explained that prior to applying for execution, she needed to present a surveyor’s report which could cost up to several tens of thousands of dollars.  As she had no immediate plan for the use of Lot 841, she then decided to wait until 2014, before the expiration of 12 years, to apply for execution.

22.  On the other hand it was D2’s pleaded case in his defence and counterclaim that by the time of the commencement of this action, he had already acquired an adverse possessory title over Lot 841 by reason of his uninterrupted use, occupation of enjoyment of the lot since about 1982 and with intention to possess the lot to the exclusion of others including the paper title owner, and that further or alternatively, P’s title to Lot 841 had been extinguished by the time of the commencement of this action.

23.  It was further D2’s case that all along he had no knowledge that P had commenced the present action in July 2003 nor that she had obtained the Possession Order.  D2 said he only found out in about May 2012 during discovery and exchange of documents in the course of another litigation in which he and P were involved over Lot 622, namely DCCJ 578/2011 (“DC Action”).

24.  Thereafter, on 25 October 2012, D2 instructed lawyers to apply to set aside the Possession Order and to join in as a defendant in this action.

Legal principles

25.  The legal principles in relation to adverse possession have been set out by the House of Lords in JA Pye (Oxford) Ltd & anor v Graham & anor [2003] 1 AC 419, approving those the principles earlier expounded by Slade J in Powell v McFarlane (1977) 38 P&CR 452.  Mr Mok had summarised those principles from Pye and from Powell as follows:

“(1) The possession for the purpose of adverse possession is whether the squatter has dispossessed the paper title owner by going into ordinary possession of the land without the consent of the owner, whether adversely or not[7];

(2) For the purpose of adverse possession, the squatter has to establish (a) physical possession of the land; and (b) animus possidendi, that is, the intention to possess the land[8];

(3) Physical possession means an appropriate degree of physical control. It must be single and exclusive, though there can be a single possession exercised by or on behalf of several persons jointly. The question what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances, in particular the nature of the land and the manner in which land of that nature is commonly used or enjoyed…what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no-one else has done so[9].

(4) As regards the intention to possess, it is an intention, in one’s own name and on one’s own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the processes of the law will allow[10].

(5) Common sense caution has to be exercised towards self-serving evidence such as that the squatter alleges that he intended to take exclusive possession at a particular time[11].

(6) An owner or other person with the right to possession of land will be readily assumed to have the requisite intention to possess, unless the contrary is clearly proved.  This, in my judgment, is why the slightest acts done by or on behalf of an owner in possession would be found to negative discontinuance of possession.  The position, however, is quite different from a case where the question is whether a trespasser has acquired possession.  In such a situation the courts will, in my judgment, require clear and affirmative evidence that the trespasser, claiming that he has acquired possession, not only had the requisite intention to possess, but made such intention clear to the world.  If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi and consequently as not having dispossessed the owner[12].”

26.  In so far as Hong Kong is concerned, the above (4) has to be read subject to what Li CJ had said in Wong Tak Yue & Kung Kwok Wai & anor (1997-98) 1 HKCFAR 55, namely that :-

“[an intention that he was willing to pay rent to the owners if they had requested payment and that he was ready and able to do so] is plainly and completely inconsistent with the intention to possess[13].”

27.  Although what was said above has been questioned, as said by Lam J, as he then was, in Hong Kong Kam Lan Koon Ltd v Realray Investment Ltd [2007] HKC 122, the ratio in Wong Tak Yue is still binding on the lower courts in Hong Kong[14].

28.  Further, as said by Anthony Chan J in Wealth Hill International Investment Ltd v Wong Kwan Siu [2013] 3 HKLRD 300, the burden on the squatter to prove adverse possession is a heavy one[15].

29.  Mr Lau had also referred this court to what was said by Slade J in Powell v McFarlane, namely that the question of what acts constitute a sufficient degree of exclusive physical control must depend on circumstances, in particular the nature of the land and the manner in which land of that nature is commonly used or enjoyed and that “In the case of open land, absolute physical control is normally impractical, if only because it is generally impossible to secure every part of a boundary so as to  prevent intrusions…”[16].

30.  Mr Mok accepted that it is not absolutely necessary to fence off the land in question in order to establish exclusive possession, but referred to what was said by Lam VP in Gotland Enterprises Ltd v Kwok Chi Yau, CACV 260/2014, 19 January 2016, and submitted that absent any such physical barriers to exclude others from accessing the land, the court must examine what steps were taken by the squatter to exclude others.

31.  Mr Mok, referring to Gotland[17]and Powell[18], had also submitted that if there is evidence that others gained access to the land or even someone authorised by the registered owner to access the land, this may be regarded as “acts done by or on behalf of an owner in possession … to negative discontinuance of possession”.

32.  Further, as seen in Cheung Yat Fuk v Tang Tak Hong (2004) 7 HKCFAR 70, a squatter could be in adverse possession through a tenant by the receipt of rent.  It was held in this case that when a squatter granted a tenancy and received rent, he was acting inconsistently with the title of the paper owner and that put the squatter in adverse possession of the land through his tenant.

33.  Section 7 (2) of the Limitation Ordinance, Cap 347 provides that:

“No action shall be brought by any other person to recover any land after the expiration of 12 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:

  Provided that, if the right of action first accrued to the Crown through whom the person bringing the action claims, the action may be brought at any time before the expiration of the period during which the action could have been brought by the Crown, or of 12 years from the date on which the right of action accrued to some person other than the Crown, whichever period first expires.”  

34.  Prior to the amendment on 1 July 1991, the adverse possession period required is 20 years instead of 12 years.  As pointed out by Mr Lau,  in Yu Siu Cheuk v Realray Investment Limited, CACV 181/2009, the court stated that “But if objective evidence shows that adverse possession only began at a much later day [after the 1991 amendment] but is long enough to cover a period of 12 years prior to the commencement of action, I cannot see any reason why the plaintiff [the adverse possessor] is not entitled to rely also on the shorter period to establish his claim.”[19].

35.  With the above principles in mind, I turn to the present case.

The witnesses and evidence

36.  There were originally 4 witnesses who had filed statements in support of P’s case.  2 of her witnesses were not called, their evidence was not admitted.  Only P herself, Mr Tse and Mr Ng attended trial to be cross examined. 

37.  As for D2, he had called 4 witnesses apart from himself, namely his two tenants Lee Chi Ping (“Lee”) and So Chi Shing (“So”), and two other villagers and/or former villagers Yau So (“Yau”) and Yuen Kam Tim (“Yuen”), to testify as to his occupation of the Lot 841.

38.  P’s expert Mr Ma submitted a report dated 15 December 2014 in relation to the condition and use of Lot 841[20].  D2’s expert Mr Leung submitted his report dated 30 December 2014[21].  The two experts had also filed a joint statement dated 25 July 2014 setting out their areas of agreement and disagreement (“Joint Statement”)[22].  The parties agreed that it was not necessary to call the experts, in light of their areas of disagreement being relatively minor.

39.  In their respective expert reports, Mr Ma and Mr Leung had referred to and relied on Lot Index Plans, Setting Out Plans, Survey Sheets and Aerial Photos obtained from the District Land Office over the years, which were contemporaneous records.

The agreed issues to be determined

40.  A list of agreed issues lodged by the parties on 8 December 2016 set out the following:

(1)   Whether the limitation period if having been triggered off, stopped running (i) as at the date of the issuance of the originating summons on 3 July 2003 or (ii) as at the date of the service of the statement of claim on 18 April 2013 (“Relevant Date”) (“Issue (1)”);

(2)   Whether or not D2 was in factual exclusive and continuous possession with the requisite intention for a sufficient period of time before the Relevant Date (20 years if the trespass began before 1 July 1991 and 12 years if thereafter) (“Issue (2)”);

(3)   Whether D2 had ever gained factual exclusive possession in 1982 with the requisite intention as claimed or at any other time thereafter:

(i) Had Lot 841 been vacant for any period after the 1983 Fire for more than a year and had D2 (assuming he had previously gained factual exclusive possession of the Lot 841 with the requisite intention before the 1983 Fire) thereby discontinued and/or abandoned possession of the Lot 841?

(ii) Whether or not by the Setting Out Survey carried out upon the request by Yu in 1985 Yu regained possession of Lot 841 (if Yu had discontinued possession earlier and/or if D2 had been in possession thereof for any period prior to the Setting Out Survey),

(iii) If the answer to either (i) or (ii) is ‘yes’, did D2 ever again gain factual exclusive possession of the Lot with the requisite intention after the period when Lot 841 was vacant and/or after the Setting Out Survey in 1985 and if so when?

(“Issue (3)”)

From 1976/1977 until the 1983 Fire

41.  I will start with Issue (3).

42.  According to D2, he was born in Guangzhou in 1958 and he came to settle in Hong Kong with his father in 1962.  After completing Form 3 schooling, he started to live with his father in North Point, and to work as an electrician.  He became unemployed in 1976/1977, and he was invited to move in with his friend Sin Wai Chuen (“Sin”) who was then residing on Lot 841.  Apart from him, Sin’s two other friends, a Mr Chan Kwok Wah (“Chan”) and a Mr Cheuk Siu Mo (“Cheuk”) were also living there.

43.  It was D2’s case that at the time he moved there, there were 2 one-storey houses which he described as平房屋standing on Lot 841, each of about 600-700 sq ft with a cockloft inside, and that the 2 houses were made of wood with a zinc/iron sheet roof.  According to D2, behind the 2 houses were other houses, and all the roofs overlapped.

44.  D2 had also said under cross examination that when he moved in, he was not aware of the house numbers, but later he discovered that the one with the shop name Kam Hong Lung/錦康龍was house no 127 and that this was the one which was often used by him.

45.  D2 had agreed that there were 4 numbers for the original 4 Houses namely 127, 129, 131, 133 of Cha Kwo Ling Main Street, but maintained there were only two houses, when he moved there, as according to him, the partitions between the original 4 Houses had been removed in 1976 to form 2 houses.  He had drawn a plan during the trial to indicate the 2 houses[23].  On re-examination, he also drew on the plan the original 4  Houses[24] and he had indicated thereon where the shop Kam Hong Lung/錦康龍 was, and next to it the shop with the sign Wah Kee/華記飯店 at no 129, but said at that time it was very dilapidated.  D2 had also said it was Sin’s parents who started the shop Kam Hong Lung/錦康龍, but Sin’s parents had moved away in 1976/1977 when D2 moved there.  D2 also indicated where the other two houses 天成號 and 天成棧 used to be, but said when he moved in, they were deserted and no one was occupying those houses.  

46.  D2’s witness Yau is an indigenous resident of the Cha Kwo Ling Village, and he was a member of the Rural Committee of Cha Kwo Ling Village茶果嶺鄉公所街坊值理會and the Chairman of the Villagers’ Association 鄉民聯誼會總理. Yau was born in 1946 and is now 68 and he said his ancestors started residing in Cha Kwo Ling Village in 1880, and he grew up in the area and knew the area well. 

47.  According to Yau, he first noticed in 1976 that D2 had moved into Sin’s house at where it is now known as 126A, 127, 127A and 127B of Cha Kwo Ling Main Street.  It was Yau’s evidence in his witness statement that prior to D2 moving in, he only knew Sin was occupying the house on Lot 841 by himself.  Yau had also said that in 1974 the landlord increased the rent and Sin’s family could not afford the rent and they moved away, leaving only Sin in occupation after 1974.  

48.  Yau’s evidence during the trial was that when he was young, there were the 4 Houses, the 1^st one was Kam Hong Lung, the 2^nd one was Wah Kee, and next to Wah Kee was天成號 and 天成棧.  Yau had said that Sin was occupying Kam Hong Lung and D2 was occupying Wah Kee, 天成號 and 天成棧.  He said there were house numbers but he did not pay attention, and that they were all wooden houses.  Yau maintained that before the 1983 Fire, all the houses in that area were wooden houses.

49.  D2’s other witness Yuen was born in 1954.  His parents including his elder sister and brother-in-law had rented premises on Lot 841 to carry out the grocery business of 天成/Tin Shing, and that the then owner/landlady was Madam Chan.  According to the record at the Land Registry[25], Wong became the registered owner of Lot 841 as administrator of Madam Chan’s estate on 10 May 1969.  Wong had originally given a witness statement on behalf of P but he failed to turn up at the trial.

50.  According to Yuen, Tin Shing Ho/天成號was the grocery shop and Tin Shing Charn/天成棧was the warehouse for storage.  Yuen said he recalled that when he was attending kindergarten, he would often go to 天成號 to do his homework and to play there.  Yuen said in fact天成號 and 天成棧 were part of the same house and it was larger in area than Kam Hong Lung, Wah Kee or another house rented by Tse Hung.

51.  Further, according to Yuen, from 1958 /1960 until 1973/1974, the numbers of 天成號 and 天成棧 were respectively no 131 and 133, and that Kam Hong Lung was carrying out the business of selling paper offerings and candles, Wah Kee was a restaurant and on its right was a café run by Tse Hung.  Yuen said he had heard from his mother that in 1973/1974 the new landlord wanted to increase rent, and Tin Shing, and other tenants including Kam Hong Lung, Wah Kee and Tse Hung all decided not to continue to rent, and they all ceased their businesses and vacated the premises which then became abandoned.

52.  Yuen said in about 1974, when he walked past Lot 841, he found out someone had moved in, and was often carrying out rebuilding works on Lot 841, and he later found out that the man was Sin, and later in 1975/1976, other men including D2 had moved into Sin’s premises.  Yuen said he saw D2 in 1976 and he was going in and out of the house which used to be Kam Hong Lung, and sometimes he would go next door.

53.  Yuen confirmed that the 4 Houses later became 2 houses.  It was also Yuen’s evidence that the houses were wooden houses, and not made of brick or stone, pointing out that if made of stone, they would not have burnt down.  Yuen also that the 5^th house ie house no 135 was a stone house, but the rest were all wooden houses with iron sheet roof.  

54.  D2 had said in his witness statement that during his occupation he had no idea whether Sin was the actual owner of the 2 houses, and that he and the other two occupants did not need to pay any rent or any fee to Sin for occupation, although he would help Sin in maintaining and building the 2 houses, and that he had also grown some plants on the land.  It was also D2’s evidence that while he was living there, he had never seen anyone going there to collect rent or any payment for occupation from Sin. 

55.  According to D2, one day in 1980, Sin left and never returned. D2 said he and Chan and Cheuk continued to live on Lot 841 until 1982, when Chan and Cheuk also moved out, and D2 said thereafter, he was the only person living on Lot 841.

56.  Then the 1983 Fire took place and the 4 Houses/2 houses were burnt to the ground and destroyed.

57.  On the other hand, P’s case was that there were 5 houses on Lot 841 and they were permanent structures made of stone, and that none of the persons alleged by D2 had occupied the stone houses.

58.  P is now about 82 years of age.  She was in hospital about two weeks before the trial and appeared to be frail when giving evidence.  She had said that in 1972/1973, she was working as a full time teacher.  When it was put to her that she did not visit Lot 841 prior to Yu’s acquisition, P however said she had passed by the site and that she saw there was “石， 山，草，爛地”.  When she was asked whether Yu had signed any tenancy agreements after acquiring Lot 814, she however answered “有幾間石屋”, and when she was asked how she knew they were stone houses, her answer was “我摸過的石”.  When she was asked when she went there, she said she could not recall.  According to P, there were rent receipts when Yu went to collect rent but now these were lost as it was a long time ago.

59.  When she was asked again whether Yu had signed any new tenancy agreements, she said she was not clear, but claimed that she did go with Yu to the site in 1974 when Yu went to collect rent and said something to the effect that “...好難收”.

60.  On the other hand, P agreed with Mr Lau that Yu did increase the rent in 1974.  She said she was not clear whether the tenants had moved away because of the increase in rent.  She maintained that she did go with Yu to collect the rent once or twice a year, and it was Yu who would be driving and if they passed by the site, they would stop to take a look.  She maintained there were 5 tenants.  When she was asked whether she had noticed any change in the appearance of the structures on the site between 1979 to 1980, she first of all answered that “天台有蠟青，望到不過唔清楚” and when she was asked again whether she noticed there were any changes in 1980, she answered “石無改變，我係出面摸過的石”.  She maintained that she had touched the stone and that was why she knew they were stone houses.  She however did not mention her touching the stone in her witness statement.

61.  In P’s witness statement, she had referred to Lot 841 being several thousands of sq ft and that part of the site was grassland and mud with trees, and at another end there were 5 stone houses. However, on the Aerial Photos taken in 1967, 1972 and 12 October 1973, there was only the row of 5 houses on Lot 841 and there was no grassland as described by P[26], or the “石，山，草，爛地” mentioned by her at the trial.  Further, the area of Lot 841 is only about 1,300 sq ft.

62.  Anyway, I find P’s evidence rather vague and it was not clear what stone or which of the exterior part of the 5 houses she had touched.  When it was put to her that before 1984, the houses were not stone houses and that they were all burnt to the ground level during the 1983 Fire, P had also answered she was not clear and that she only learnt from the newspapers that the residents in the area were re-settled.

63.  According to Mr Ma, from extracts of old Survey Sheets of 1957-1980[27], the 5 houses nos 127, 129, 131, 133 and 135 had been consistently mapped by solid lines in the pre 1985 Survey Sheets showing that they were not temporary structures, and that nos 127-133 were within Lot 841 and no 135 was outside Lot 841.  Mr Ma had drawn attention to house no 135 which was the only house in the row of houses not damaged by the 1983 Fire and is still standing today, and that it is a stone house with the traditional pyramid roof. 

64.  The enlarged Aerial Photo of 27 January 1963 showed a row of 5 houses and there was also a small portion of another house found inside the western tip of Lot 841 and that the row of 5 houses were of a similar type with pyramid roofs and that same conditions were seen on the Survey Sheets/ Aerial Photos between 1965 and 1978. 

65.  The Aerial Photo of 1979 however showed the roof of house no 127 was changed to a darker colour, and that according to Mr Ma, the roof of no 127 appeared to be under construction works[28].  Mr Ma was further of the view that from the Aerial Photos of 1980, 1982, and 1983, the roof of house no 127 was clearly different from the other stone houses within Lot 841[29].

66.  It was not clear why Mr Ma had referred to “other stone houses”, as there was no basis given by him as to why he referred to the other houses as stone houses and what he said appeared to be based on the fact that the 5^th house or house no 135 was a stone house.

67.  Mr Ma had attached in his report a copy of the Sing Tao Newspaper report dated 21 December 1983 in respect of the 1983 Fire[30]  and that according to the newspaper report, 20 odd wooden houses in the area were burnt and destroyed during the fire.

68.  During cross examination, D2 agreed that the two平房屋 of wood with a zinc/iron sheet roof described by him would be regarded by the Government as “temporary structures”.

69.  Although the Aerial Photos of 13 December 1978 and 20 May 1979 showed not much of a change, when comparing the two, I noticed the roofs on house nos 131 and 133 appeared to be less defined in the latter photo than the earlier photo and it cannot really be seen from these photos whether the houses were made of wood or stone.  In any event, the last Survey Sheet obtained by the experts prior to the 1983 Fire was in September 1980, which meant there was no survey between September 1980 and December 1983.

70.  The two experts had agreed that in 1984 the 4 Houses/2 houses had disappeared leaving Lot 841 as a ruin and vacant site and that house no 135 was unaffected by the 1983 Fire.  This can also be seen from the Aerial Photo taken on 6 May 1984[31] that where the 4 Houses used to be was then unbuilt on and the only house seen was the 5^th house no 135.

71.  It would thus appear more probable than not that there was a difference in the building material of the 4 Houses/2 houses and house no 135.

72.  Having considered all the evidence, I am prepared to accept the evidence of D2, Yau and Yuen in this respect and I find more probable than not that prior to the 1983 Fire, the 4 Houses/2 houses on Lot 841 then numbered 127, 129, 131, and 133 were made of wood rather than of stone. 

73.  I am also prepared to accept D2’s evidence that he moved to Lot 841 in about 1976/1977 and that by then the 4 Houses became 2 houses.  However, it was not quite clear as to which house he was occupying. Yau’s evidence was that the former Kam Hong Lung house was used/occupied by Sin, while D2 used/occupied the others.  D2’s own evidence at the trial was the house he often used was the former Kam Hong Lung or no 127 and this was also Yuen’s evidence although Yuen did mention occasionally D2 would go and sit next door.  Anyway, there was no sufficient evidence that D2 was occupying both the houses or all 4 Houses on Lot 841, or the entire Lot 841.

74.  As mentioned earlier, D2 had said in his witness statement that he did not know whether Sin was the owner of Lot 841 or not.  It would appear from D2’s evidence that Sin was really the person who was in control of Lot 841 and that in return for being allowed to live there, as said by D2, he had assisted Sin in carrying out building works at no pay.  After Sin moved away in 1980, thereafter, it would appear to this court that all 3 of them, namely D2, Chan and Cheuk were all in occupation or control of Lot 841.

75.  In any event, Sin, Chan and Cheuk only moved away on their own.  The fact that they did not return did not necessarily mean they could not return or that they were prevented by D2 to return.  There was no evidence that had Sin, Chan or Cheuk wanted to return to occupy part of Lot 841, they would not be able to do so.   

76.  Although it was pleaded by D2 that since about 1982 he had the intention to possess the lot to the exclusion of others including the paper title owner of Lot 841, I find there was no sufficient evidence that D2 had done anything or taken any steps to take exclusive possession and/or to exclude all others from Lot 841 from 1982 onwards, or that he had done anything or taken any steps to make his intention clear to the world.

After the 1983 Fire to the 1985 Setting Out Survey

77.  It was D2’s pleaded case in his defence and counterclaim that after the 1983 Fire, “following the examples of the use of some neighbouring land as stalls for business, D2 constructed on Lot 841 structures with wooden scaffolds and canopies to be used as stalls as well as some chicken cages”[32], and that in about 1984, he had orally leased out the lot to Lee and So.

78.  D2’s evidence in his witness statement was that after the 1983 Fire, in early 1984, the Government had placed an iron wire mesh at the back and one side of Lot 841 to delineate the boundary, and that at the same time, he had returned to the site to clear the rubbish, and had placed some tables, chairs, cupboards and wooden plants on the site, and had also inserted a wooden plank at the front of Lot 841, to delineate the area occupied by him.

79.  D2 had also said in his witness statement that after the 1983 Fire, there were people who had set up stalls on the vacant land and that he had also built 臨時木棚建築物/temporary wood structures, with canopy/canopies, and that this was “in early 1984”.  However, during the trial, when asked again when this took place, D2 said he recalled it was “between 1984 to 1985”. 

80.  Mr Mok had suggested to D2 that he now moved the period later because his expert Mr Leung had agreed with P’s expert Mr Ma that in 1984, Lot 841 was a ruin and vacant site.  D2 denied this.

81.  D2’s evidence in his witness statement was that later he had built some chicken cages and stalls, and that it was in about 1984/1985 he had rented Lot 841 to Lee and So.  Again, D2 moved the period later then what was pleaded.

82.  As for Lee, in his witness statement, he had said it was in about 1984/1985 that he orally rented from D2 no 126A for use to sell live chickens, and that his stall was next to So’s stalls.  During the trial, Lee accepted that this should be 1985.

83.  So far as So was concerned, in his witness statement, he had said that in about 1984/1985, he had orally rented from D2 stalls at nos, 127, 127A and 172B, and then sub-let them to others to sell seafood and frozen meet.  At the trial, So then said it was in 1984 that he started to rent the 3 stalls from D2 and this continued until 2003. 

84.  D2’s other witness, Yau, had said in his witness statement that he saw D2 building temporary wooden structures with a canopy covering, and also chicken cages and stall/s, but Yau did not mention when this was.

85.  P’s own evidence as to what happened during the period after the 1983 Fire and 1985 was again rather vague and was not helpful. Although she said she did go with her husband to visit Lot 841 after the 1983 Fire, she was not able to recall when or how long it was after the 1983 Fire. She said she saw “枯草” and she did not ask her husband as to what happened to the tenants.  She could not recall whether Yu had arranged for any one to go and clear up the site, but maintained that she had visited the site with Yu once in a while after the 1983 Fire.

86.  As mentioned earlier, the Aerial Photo taken on 6 May 1984 showed that the site where the 4 Houses/2 houses formerly stood was unbuilt on and only house no 135 remained.  Mr Leung observed two straight dark lines at the northern boundary and to the west of Lot 841, and by referring to the February 1985 Survey Sheet he opined those dark lines seemed to be fences, and that Lot 841 was virtually enclosed by the fences at north and west, the temporary structures/shelters outside the southern boundary of the lot, and house no 135 at the eastern side[33].

87.  These fences appeared to be fences put in by the Government in early 1984, as mentioned by D2[34].

88.  The experts agreed that as shown in the February 1985 Survey Sheet, the whole of Lot 841 as well as the northern ruin site was enclosed by a fence, and although the fence was not discernible from the Aerial Photo, the experts agreed and accepted that “the fencing was a fact and that the enclosed site was vacant”[35].

89.  P’s expert, Mr Ma, was working in the District Survey Office, Kowloon as acting Senior Land Surveyor in 1985 and was the one who had signed on a survey record plan (“1985 Survey Record Plan”), which was the end product of the boundary survey for record after completion of the 1985 Setting Out Survey and filed for future reference[36].

90.  The 1985 Setting Out Report consisted of 3 documents, a setting out plan dated 6 March 1985, an additional report dated 6 March 1985 and an extract copied minutes of approval dated 14 March 1985.  It can be seen from the minutes of approval of the 1985 Setting Out Report that the site was reported to be vacant at the time the boundaries were determined by the Survey Officer.

91.  P’s architect Mr Ng had attended trial to give evidence and confirmed that it was his colleague Mr Ngan Po Wai who attended the site together with the Survey Officer at the time of the 1985 Setting Out Survey, but that Mr Ng said Mr Ngan was not able to recall what happened. 

92.  In any event, there was no challenge to the contents of the 1985 Setting Out Report.  The 1985 Setting Out Survey commenced on 23 January 1985 and the date of setting out of the boundary was 12 February 1985 and the boundaries shown to Yu’s architect on 13 February 1985.

93.  To summarise, according to D2’s witness statement, the timeline of what he did after the 1983 Fire was (1) in early 1984 he placed some furniture items and wooden planks on Lot 841 and inserted a wooden plank to delineate the area occupied by him[37]; (2) in about 1984 he put up some temporary wooden shelters with a canopy[38]; (3) after a period of time, he built the chicken cages and stalls[39]; and then (4) in about 1984/1985 he leased the chicken cages and stalls to Lee and So[40].

94.  It was pointed out by Mr Mok that what D2 had said in (1) above, namely that he placed various chattels and inserted a wooden plank to delineate the occupied area was not mentioned in his affirmation of 24 October 2012 which was filed to support his application to set aside the Possession Order (“24.10.12 Affirmation”)[41].  D2 denied that he had made up what he said and explained his previous omission by saying it was not important nor necessary for the setting aside application to include so many details in his supporting affirmation. However, D2 admitted that at the time, his lawyer did ask him when he returned to the site.

95.  As D2 was the one who was applying to set aside the Possession Order, one would have thought he would have included as many details in his 25.10.12 Affirmation as to his occupation/possession as possible, including when he first returned to occupy the site and what he did when he returned.  Further, what he said he did in early 1984 was not pleaded in his defence and counterclaim filed in May 2013.

96.  Mr Lau had submitted that D2 did not discontinue being a squatter on Lot 841 after the 1983 Fire, and that with the assistance of the Government’s fencing, D2 was able to keep other people out by putting some of his chattels on Lot 841 and the plank and that other people could not enter Lot 841.

97.  Mr Lau had also submitted that whether site was vacant must be looked at in the context, namely that it was vacant in the sense that there were no temporary or permanent structures but did not necessarily contradict D2’s evidence that he had put chattels or inserted a plank in front of the site to mark his occupation.

98.  First of all, I do not find D2’s explanation for omitting to mention in his 25.10.12 Affirmation when he first returned to and occupied the site after the 1983 Fire convincing.  I do not in fact find there was sufficient evidence that D2 had placed any furniture or chattels or that he had put up a plank on the “front end” of the Lot 841 in early 1984 to delineate the area occupied by him as he claimed.  It was also not clear where D2 placed the plank.

99.  There was no evidence that people would in fact be kept out of Lot 841 by the fence put up by the Government.  On D2’s own evidence, it certainly did not keep D2 out.  The fence clearly did not keep out those persons involved in the 1985 Setting Out Survey.   

100.  According to the Aerial Photo of 6 May 1984, there were no signs of any structure or canopy/ covering.  There was nothing there in May 1984.  As mentioned earlier, it was the view of the Survey Officer during the 1985 Setting Out Survey that the site was vacant, and this was agreed by the parties’ respective experts.

101.  The fact that Lot 845 was vacant can also be seen in a plan prepared after the 1985 Setting Out Survey in which no temporary structures were marked within the lot and the corner marks were set out in the plan and the table recorded how the corner marks were done[42] and this plan was produced by Mr Leung.

102.  During the 1985 Setting Out Survey, which was carried out under the instructions of Yu, the Survey Officer had set out the boundaries for Yu.  As seen on the 1985 Survey Record Plan[43] and as explained by Mr Ma, each corner point was pegged out at site with concrete nail drilled onto concrete surface and iron pike drilled onto each respectively.  Mr Ma further pointed out that the pecked lines linking between survey marks or traverse stations (control marks) mapped in the 1985 Survey Record Plan would indicate that the marks could be sighted through each other with a survey instrument set up over the mark about 1.6 meter from ground level and that this corroborated the remark contained in the minutes of approval of the Setting Out Report that the site was vacant[44]. 

103.  The experts agreed that, as seen in the Aerial Photo taken on 19 February 1985[45], at the southwestern portion of Lot 841 there were some sort of shelters or canvas sheets seemingly for covering materials.  Having considered the photo, I am only prepared to accept that there were some sort of structures on the southwestern end of Lot 841 and with a covering/canopy on 19 February 1985, after the 1985 Setting Out Survey. 

104.  However, even if these were left by D2, this would not be sufficient to establish that D2 was in exclusive possession or control of Lot 841.

105.  Anyway, having considered the Aerial Photos, I find that any building of live chicken cages and stalls by D2 and the renting out of the same to Lee and So could not have happened in 1984, and would have to be sometime after 19 February 1985.

106.  Mr Lau had also submitted that there was no claim or evidence that the Survey Officer or Ng’s representative had entered the site to carry out any activities or that they had claimed to anyone that they represented the land owner in conducting the exercise.

107.  Apart from what Mr Ma had explained how the corner points were pegged at site, Mr Ng had also explained the practice of the District Survey Office in carrying out a survey[46].  In my view, the 1985 Setting Out Survey could not have been carried out without the Survey Officer and Ng’s representative entering Lot 841. There was no evidence they were prevented by anyone in carrying out their activities on Lot 841, or anyone was there to whom they could inform that they represented the land owner in conducting the exercise. There was no evidence that there was any fence or any plank preventing them having access to Lot 841 when carrying out the 1985 Setting Out Survey.

108.  Even if there were indeed chattels and a plank placed by D2 in early 1984 as alleged by him to delineate the area occupied by him, in my view this would have been superseded by the 1985 Setting Out Survey. 

109.  Mr Lau also submitted that after the 1985 Setting Out Survey, the owner/Yu did not put up any notice on Lot 841 on the marked boundaries and corners to assert his ownership and that Yu did not dispute that the fences in early 1984 were put up by the Government and he did not take any action against fences put up by some other people. 

110.  Notwithstanding that Yu did not put up any notice on Lot 841, if he had indeed been dispossessed prior to the 1985 Setting Out Survey, in my view that by requesting the 1985 Setting Out Survey and the 1985 Setting Out Report, Yu exerted ownership and/or had made an effective entry onto Lot 841.  As said by Slade J in Powell[47], cited earlier in this judgment, that in his judgment the slightest acts done by or on behalf of an owner with the right to possession will be found to negative discontinuance of possession.

111.  In any event, the fact that the Survey Officer and Ng’s representative could enter Lot 841 to carry out the 1985 Setting Out Survey during a period between 23 January 1985 and 13 February 1985 would in any event indicate that D2 was not in exclusive possession of the lot. 

112.  To conclude, having considered all the evidence, I find there was no sufficient evidence that D2 was in physical occupation or possession of any part Lot 841 during the period after the 1983 Fire and the 1985 Setting Out Survey.  It is thus my finding that even if D2 was in exclusive occupation of Lot 841 in 1982 prior to the 1983 Fire, such occupation had discontinued after the 1983 Fire until sometime after the 1985 Setting Out Survey.

After the 1985 Setting Out Survey until May 1997

113.  It was not really disputed that by about early to mid 1986, an open mini market, the Cha Kwo Ling Market, had sprung up on the Government land near the southwestern side of Lot 841.

114.  As seen earlier, it was D2’s evidence that he had leased out the live chicken cages and stalls respectively to Lee and So.  Lee said he rented the chicken cage/stall on no 126A from D2, and his monthly rent was HK$200.  So said he rented 2 stalls from D2 on no 127, 127A and 127B, and his monthly rent was HK$800. 

115.  D2’s case was that this situation continued throughout until about 2003 when there was SARS in Hong Kong.

116.  As for P’s case, she had said in her witness statement that in about early or mid 1986, one of the former tenants of the stone houses on Lot 841 had asked Yu to rent part of Lot 841 to him for hawking purpose, to sell vegetables and meat.  At the time, on the Government land next to Lot 841, there were already other hawker stalls there selling groceries, vegetables and meat forming the mini market.  It was P’s evidence that Yu agreed and rented part of Lot 841 to the tenant at a low rent and that the tenant could assist in looking after the entire Lot 841, and to prevent other hawkers occupying Lot 841.  Thereafter, Yu would go and collect rent every one or two months, and from 1986 onwards, P would accompany Yu to go to Lot 841 to collect rent once or twice every year or every other year. 

117.  P had also said in her witness statement that towards the end of 1990s, Yu told her that the tenant of Lot 841 was getting old and in poor health and gave up hawking, and had handed back Lot 841 to Yu, since when it was not occupied.  As mentioned earlier, it was only when Lawson David was carrying out valuation of Lot 841 in 2002 that P found out there were authorised occupiers on Lot 841.

118.  It was thus P’s case in her witness statement that from 1986 to end of 1990s, part of Lot 841 was rented out by Yu to a former tenant.

119.  During the trial, P was cross examined over whether anything particular happened in 1986, she had answered she could not recall.  When it was put to her that after the 1983 Fire, Lot 841 was never rented out, her answer was she was not clear.

120.  Again I find P’s evidence rather vague and unsatisfactory. It was also not clear which of the former tenants P was referring to in her witness statement and which part of Lot 841 was leased by Yu.  I appreciate she is elderly and is fragile, but according to P, Yu was a cautious and experienced land investor and had bought many pieces of land in the New Territories, and one would have thought there should be proper records of any tenancies and yet there were no such records produced.  It did not seem probable that Yu being an experienced investor in land in New Territories would agree to any oral tenancy.  I do not find P’s evidence reliable in this respect.

121.  Mr Leung had pointed out that on the March 1988 Survey Sheet, the fence which enclosed Lot 841 in the 1985 Survey Sheet was opened at the south western side of Lot 841[48] and the 1988 Survey Sheet did not show the temporary structures at the south western corner of Lot 841, which were present since 1985 in the Aerial Photo[49].

122.  Mr Ma had observed that on the Aerial Photo of 2 November 1993, the roofs at location of H1 seemed to have changed to a smooth surface like metal roof and still linking up with other roofs and said the situation remained the same as seen on other Aerial Photos of 1994, 1995, and 1997[50].

123.  The experts agreed that from 1986 to 1995 the area formerly covered by shelters or canvas sheets had changed to become temporary structures to occupy the western portion of Lot 841, and that these temporary structures appeared to be joining with more temporary structures to the south of and outside Lot 841 to form a large group of temporary structures (“TS Group”) and that the remaining area of Lot 841 was grown with shrubs or trees[51].

124.  The TS Group and the remaining area of Lot 841 remained very much the same as seen in the Aerial Photos of 6 May 1994 and 27 September 1995.

125.  The overall situation as seen in the Aerial Photo taken on 26 May 1997 remained more or less the same as before.  Mr Leung had however observed that the roof of the temporary structures at the western portion of Lot 841 became lighter in colour and indicated that the roof had been renewed.

126.  Anyway, there were no Aerial Photos between 19 February 1985 and 22 September 1986.  Having considered all the evidence, I am prepared to accept that D2 had placed temporary wood structure/s with canopies on the south western portion of Lot 841 from about 19 February 1985, onwards, but it was only sometime later in 1985 or in 1986 that he had built chicken cages and stalls to rent to Lee and So.  I accept that by September 1986 the cages and stalls were there, and as agreed by the experts, they formed part of the TS Group.  

127.  Having said this, the occupation/possession by D2 was only over the south western part of Lot 841 as seen in the Aerial Photo of 22 September 1986.  The remaining area of Lot 841 was over grown with shrubs and trees, and the situation remained more or less the same until as seen in the Aerial Photo of 26 May 1997.

128.  Even though there was physical occupation or possession of the south western portion of Lot 841 by D2 during the period from 1985/1986 until May 1997, I find there was no sufficient evidence that D2 had done anything or taken any step to occupy or possess or to exclude any one from the remaining unoccupied area of Lot 841.  I find there was no sufficient evidence that D2 had the intention of possessing the entire Lot 841 to the exclusion of others.

From May 1997 to October 2005

129.  As seen in the Aerial Photo of 26 May 1997 and as mentioned earlier, the roof over no 126A had become different by then.  The experts agreed that the roof of the temporary structure at the western portion of Lot 841 became a distinctive rectangular shape and lighter in colour thus indicating that the structure might have been renewed. There was no explanation from D2, Lee or So.

130.  The experts agreed that apart from this change, the remaining area of Lot 841 stayed very much the same as before, namely grown with shrubs and trees.  I accept that apart from the roof over no 126A, the rest of Lot 841 remained more or less the same in the Aerial Photo of 26 May 1997 and also thereafter, as seen in the Aerial Photos of 4 August 1998, 11 June 1999, 8 November 2001, and 31 May 2003.

131.  It was D2’s case that he continued to rent Lot 841 to Lee and So until about 2003 when there was SARS in Hong Kong and the economy was greatly affected.  The business of the sub-tenants of So and also the business of Lee fell drastically, and according to D2, Lee and So had approached him to seek a temporary suspension of rental payment.  D2 agreed to withhold demanding any rental payment, and that Lee and So only resumed paying rent to D2 in early 2004 until the market was closed.  According to D2’s witness statement, this was in about 2006.  However, according to the evidence of So and Lee in their witness statement, this was in 2007.  

132.  The February 2000 Survey Sheet indicated an area with broken dashed lines where the western portion of Lot 841 protruded onto (“Enclosed Area”).  Mr Ma had coloured the broken dashed lines yellow for easy identification[52]. The Enclosed Area was however not seen on the earlier April 1998 Survey Sheet.

133.  The Enclosed Area was seen on Survey Sheets subsequent to February 2000, namely on the 2003 Survey Sheet, the July 2004 Survey Sheet, and also on the July 2004 Survey Sheet, “TS” meaning temporary structures, was marked in about the centre of the Enclosed Area[53].

134.  It was not disputed that there was another setting out survey carried out in July 2003 (“2003 Setting Out Survey”), and the setting out plan was dated 1 August 2003 (“2003 Setting Out Plan”)[54].  The 2003 Setting Out Survey was requested by Housing Manager of the Squatter Control, Kowloon.  This survey commenced on 17 July 2003 and the date of setting out was 30 July 2003.

135.  It was also not disputed that, as seen in the later 2012 Survey Sheet an area called “休憩處”/little playground (“Sitting-out Area”) was marked within the Enclosed Area.  The Sitting-out Area is situate within the Lot formerly known as GLA-TNK 531 and later known as GLA-TNK 1474[55].

136.  Mr Ma’s conclusion in his report was, among other things, that[56] :

(i) A market under a group of temporary shelters adjoining Lot 841 was found between 1986 to 2004;

(ii) A portion of Lot 841 was utilized as market and people could walk freely through Lot 841 as passage.  The rest of Lot 841 was covered with grass and trees;

(iii) There was complaint of dangerous structures in the market adjoining Lot 841 and the temporary structures in the market were demolished for the construction of the Sitting-out Area at GLA-TNK 531 by Government.  The market was cleared and works to construct the Sitting-out Area started in 2005;

(iv) Although the market was cleared in 2005, temporary structures covers were seen along the southern and western boundaries of Lot 841.

137.  There was disagreement between the experts over mainly two areas[57]:

(i) Mr Ma’s suggestion that in 2000-2003, part of Lot 841 was used as the Cha Kwo Ling Market.

(ii) Mr Ma’s statement at the conclusion of his report, namely “People could walk freely through Lot 841 as passage”.

138.  The 2003 Setting Out Plan consisted of 3 pages and on the 1^st page, the following handwritten words can be seen in relation to “Remarks” on the 2003 Setting Out Plan:

“This survey is to identify the boundary of lot no 841 (position) in SD3, lot GLA-TNK 531 and Government near Cha Kwo Ling Market to treat with complaint of dangerous structure for the purpose of clarification[58].”

139.  The 2^nd page then set out a plan and the 3^rd page set out the computations of the area from the boundary points.  By comparing the 1985 Survey Record Plan, and the February 2000 Survey Sheet, part of the Enclosed Area was within GLA-TNK 531[59], but it could not be certain as to whether the entire Enclosed Area was the Cha Kwo Ling Market, namely whether underneath the roofs of the entire TS Group was the market.

140.  Mr Leung said the temporary structures within Lot 841 joining with other temporary structures outside the lot did not mean such portion of Lot 841 was utilized as part of the Cha Kwo Ling Market.

141.  I accept that there was no sufficient evidence as to the exact location of the Cha Kwo Ling Market or that the entire Enclosed Area including the western portion of Lot 841, was the Cha Kwo Ling Market.

142.  As to whether people could walk freely through Lot 841 as passage, as mentioned earlier, in September 2002, prior to 2003 Setting Out Survey, Lawson David was instructed by P to conduct a valuation in respect of Lot 841 and there were two inspections by Mr Tse, the Land Consultant of Lawson David.  Mr Tse had attended the trial to be cross examined.

143.  Mr Tse had taken photographs of Lot 841 and he had produced 9 photos, 7 of which bearing the date 3 September 2003.  It was Mr Tse’s evidence that throughout the two inspections, he was able to freely access the whole of the site except areas with structures erected thereon without interruption or interference by any person, and he had said the physical condition and state of occupation of the site more or less the same between the two inspections.

144.  All the photographs produced by Mr Tse were taken during the 03.09.03 Inspection.  He had said in his witness statement that he took 2 photographs during the earlier 03.09.02 Inspection and that these were exhibited by an affirmation of another person, but for some reason, that affirmation was not placed before this court, nor were those 2002 photographs.

145.  Mr Tse had also produced enlarged extract of the Lot Index Plan and he divided the total area of Lot 841 into 7 areas, which he designated as A1-A7[60], for ease of reference.  Apart from A2, the other areas were described by Mr Tse as dumped with waste material and/or dilapidated.  As for A7, the area behind A1-A6, it was said to be deserted bare land with wild grass and rubbles save that behind A3 and A4 there were some clothes hung for drying and behind A4 and A5, there was a small papaya tree.  Further, save that Mr Tse found some broken mesh wire existed between small portion of A5 and A6, he said Lot 841 was not fenced off by mesh wire or otherwise during his visits.

146.  Mr Tse’s evidence gave a clear description of what he found in the 7 areas indicated by him.  There was no supplemental witness statements or oral evidence from D2, or any of his witnesses to challenge the evidence of Mr Tse.

147.  The then condition of the site can be seen from the photos produced by Mr Tse.  A2 was where Mr Tse indicated that it was used as an accommodation area and during the 03.09.03 Inspection, he saw a girl sitting in the front and doing some paper work.  It was Mr Tse’s conclusion that Lot 841 was only occupied partly, not wholly[61].

148.  As earlier mentioned, P was alerted of there being occupation on part of Lot 841 after the 03.09.02 Inspection and this led to the issue of these proceedings in July 2003.  During the trial, Mr Tse had said that during the 03.09.03 Inspection, he had gone with an assistant from Lawson David and a representative from P’s solicitors’ firm to serve the court documents on the occupiers of Lot 841 or the then only defendant in these proceedings.  He had inserted a bamboo stick in an open space, and had hung the court documents thereon contained in a plastic bag, and he took a photograph of this[62]. At the trial, he indicated on the enlarged extract of the Lot Index Plan as to where he the inserted the stick, which was the space between A6 and house no 135[63].

149.  Mr Lau had pointed out that in September 2003, Hong Kong was affected by SARS, and that the evidence of Lee and So was that in 2003 Lee and So’s sub-tenants had suspended business and that it would not be difficult that Mr Tse could walk on the passage between A6 and house no 135 without meeting anyone, and that Mr Tse’s own evidence that that he could have access to the site except areas with structures erected.

150.  However, Mr Tse had explained in relation to the 6 photos marked (1) to (6) as to why he was not able to enter inside some of the structures as there were some abandoned furniture or other items there, but he said he did enter the site as far as A5 and no one had stopped there.

151.  I see no reason to doubt what Mr Tse had said. I accept his evidence that apart from A2, the rest of the 7 areas were dilapidated and that he was walking in and out of Lot 841 freely except as described by him.  More importantly, he had said the site was not fenced off by mesh wire or otherwise.  Having said this, there was however no sufficient evidence that one could walk through Lot 841 as passage.

152.  Anyway the TS Group can still be seen in the Enclosed Area on the Aerial Photos of 31 May 2003, 25 November 2003, and 11 September 2004[64]. Whether the purpose of the 2003 Setting Out Survey was to construct a sitting-out area or not, as seen on the Aerial Photo taken on 24 October 2005[65], those temporary structures on GLA-TNK 531 had been cleared by 24 October 2005 and there were also clear patches outside the south boundary of Lot 841, and there were shrubs/trees outside over and outside the southern border of nos 126A, 127, 127A and also and remaining areas of Lot 841.

153.  I am of the view that, even if D2 did continue to rent out stalls to So and Lee from May 1997 onwards until about 2003, this was only on part of Lot 841 and latest by September 2003, the stalls on Lot 841 were largely abandoned and dilapidated, save as indicated by Mr Tse.  Further, even if D2 resumed renting stalls to Lee and So in 2004, this would have ceased by October 2005 when those former temporary structures on Lot 841 had largely disappeared as the TS Group was cleared and the site of GLA-TNK 531, where the Sitting-out Area would be constructed, was cleared. 

154.  In any event, there was no sufficient evidence on the actions or steps taken by D2 from May 1997 to October 2005 to exclude the world at large, from the entire Lot 841.  Having considered the Aerial Photos and the evidence, I am not satisfied that D2 had exclusive possession or control of the whole of Lot 841 from May 1997 to October 2005 or the requisite intention to possess the whole of Lot 841 to the exclusion of others.

From October 2005 to 2007

155.  According to D2, it was in about 2006 that the market closed down and that in 2006 Lee had approached D2 and suggested that the area previously occupied by him be rented to him for him to build a residential house.  D2 agreed and thereafter the rent was increased to HK$500 per month.  Lee spent about HK$70,000 in building his house and that his house now stands on No 126A of Cha Kwo Ling Main Street.

156.  When So heard about this, he also approached D2 and suggested he would rent the land from D2 and would build two houses, and D2 agreed and So’s rent was increased to HK$1,200 per month.  So said he spent about HK$40,000 to build his two houses, which now stand on nos 127, 127A and 127B of Cha Kwo Ling Main Street and which were completed in about 2008. According to So, he had sub-let no 127A to another person up until now and that the rent is HK$1000 per month.  Later in 2012, So rebuilt his house on No 127 for about HK$200,000, and then he partitioned no 127 into 127B which he also sublet to others.

157.  Anyway, it was Lee’s evidence that he had been occupying 126A and So’s evidence that he had been occupying Lot 127, 127A, and 127B.  It was however not clear as to who had been occupying no 133 (H6), or part of no 135 (H5)

158.  The experts agreed that from 2005 to 2007 the former temporary structures at the western portion of Lot 841 had largely disappeared leaving only a very small structure still occupying the extreme south western corner of Lot 841.  Further, the whole “TS Group” had indeed been cleared by then to become an open ground, and the remaining area of Lot 841 was covered with dense trees.  This can be seen in the Aerial Photos taken on 21 December 2006 and 23 November 2007.

159.  It is my finding that the market was closed and the TS Group was cleared by October 2005.  There was no sufficient evidence that D2, Lee and So had built their houses on Lot 841 by November 2007.  There was no sufficient evidence that there had been physical occupation of entire Lot 841 between October 2005 and November 2007. Nor was there sufficient evidence, of any steps or actions taken by D2 to exclude the world at large from the entire Lot 841.

From 2008 to 2013

160.  The Aerial photo taken on 25 July 2008 indicated that most of Lot 841 was by then built on except the open space/courtyard.

161.  The experts agreed that from 2008 until 2013, most of the trees disappeared with nearly the whole of Lot 841 covered by structures, and that the configuration of these structures remained very much the same up to the date of their respectively reports, and that there are now 6 structures/houses no 126, 127, 127A, 127B, 133, part of 135 with an open space/courtyard between structures nos 127A, 133 and 135.  Although I accept D2’s evidence he was in exclusive occupation possession of Lot 841 with the requisite intention but again only over a part of the lot.  The evidence of Lee and So was they occupied no 126, 127, 127A, 127B.  It was not clear who occupied the houses/structures on no133 or part or 135.

Summary of findings on Issue (3)

162.  To summarise, my findings are, among other things, as follows:

(i)   From 1976/1977 until the 1983 Fire

D2 moved to Lot 841 in 1976/1977 and from 1982 up until the 1983 Fire, D2 was occupying part of the lot by himself but there was no sufficient evidence that D2 was in exclusive possession of all the houses on Lot 841 or that he had the requisite intention to take exclusive possession of the entire Lot 841.

(ii)   After the 1983 Fire to the 1985 Setting Out Survey

There was no sufficient evidence that D2 was in physical occupation or possession of any part of Lot 841 during the period after the Fire and the 1985 Setting Out Survey.  Even if D2 had been in exclusive occupation/possession of the entire Lot 841 in 1982 prior to the 1983 Fire, such occupation/possession had discontinued after the 1983 Fire until sometime after the 1985 Setting Out Survey.

(iii)   After the 1985 Setting Out Survey until May 1997

D2 had placed temporary wood structures with canopies on the south western portion of Lo 841 from about 19 February 1985 and from later in 1985 or 1986 to May 1997, chicken cages and/stalls were rented by D2 to Lee and So.  D2’s physical occupation/possession was only over the south western portion of Lot 841.  There was no sufficient evidence that D2 was in exclusive possession over the entire Lot 841.  There was no sufficient evidence that D2 had the requisite intention to take exclusive possession of the entire Lot 841.

(iv)   From May 1997 to October 2005

Even if D2 continued to rent out stalls to Lee and So from May 1997 onwards, his occupation/possession was only over part of Lot 841, and in any event, by September 2003, most of the stalls were abandoned and dilapidated and again occupation/possession was only over part of Lot 841.  There was no sufficient evidence that D2 had the requisite intention during this period to exclude the world at large from the entire Lot 841.

(v)   From October 2005 to 2007

The market was closed and the TS Group cleared by October 2005.  The former temporary structures on south western portion of Lot 841 largely disappeared leaving only a very small structure on south western corner.  There was no sufficient evidence of physical occupation of entire Lot 841 nor of the requisite intention.

(vi)   From 2008 to 2013

D2 was in exclusive occupation/possession with the requisite intention over 126A, 127, 127A and 127B, but again not over the entire Lot 841.  It was not clear who occupied no 133 or part of 135.

163.  In light of my above findings, I am thus of the view that the answers to the questions under Issue (3) are :

(i) Yes, Lot 841 was vacant and unoccupied after the 1983 Fire for more than a year until after the 1985 Setting Out Survey and D2, even if he had previously gained factual exclusive possession of Lot 841 with the requisite intention before the 1983 Fire, had discontinued and/or abandoned possession of Lot 841;

(ii) Yes, Yu regained possession of Lot 841 by the Setting Out Survey, even if Yu had been dispossessed prior to the Setting Out Survey;

(iii) D2 regained factual occupation/possession but only part of Lot 841 after the Setting Out Survey in 1985/1986.  He did not gain exclusive possession of Lot 841 with the requisite intention.

Issue (1)

164.  It was Mr Lau’s argument that the time stopped running only in 2013 when P’s statement of claim was served on D2.  He relied on Markfield Investments Ltd v Evans [2001] 2 All ER.

165.  It was held in Markfield that where the proceedings for the recovery of land had been dismissed for want of prosecution, but the party holding the paper title subsequently brought a fresh action for recovery of that land, the issue of the writ in the first action did not, for the purposes of the second action, prevent time running in favour of the person in adverse possession.  It was further held that the period in possession after the issue of the writ in the first action was not to be ignored in the second action merely because that same period would have been ignored in the first action.  For the purposes of any particular action, the issue of a writ in earlier proceedings was no more relevant than a demand for possession, and such a demand did not stop time running afresh[66].

166.  However, in Markfield, the first action was dismissed.  In the present case, there was no striking out of the action despite absence of proper service.  The statement of claim cannot be in my view be regarded as starting a second or fresh action.  It was not a fresh writ or an originating process.  The order made on 22 March 2013 by DHCJ S Leung when setting aside the Possession Order ordered that the proceedings do continue as if it had been begun by writ.  Thus the statement of claim served in 2013 was served in the course of the same proceedings.  Here we have one action, and not two.

167.  Mr Lau submitted that in order to bring the writ to the attention of the adverse possessor to stop the time from running, the writ must be validly served.  Brown LJ in Markfield had referred to the appellants’ argument that adverse possession ceased not only in the four ways identified by him, but also by the issue (or perhaps issue and service) of a claim for possession, which argument was that such a proceedings was equivalent to re-entry onto the land.[67]

168.  Mr Lau argued that this court should not allow a party to rely on the defective originating process and service to stop the time from running against that party.  He pointed out that when the Possession Order was set aside, the 1 year period for service of the originating summons had already expired and the originating summons could no longer be served, and the court had no power to renew the originating summons for service.  He further argued that the nature of the claim in the 2003 originating summons and the 2013 statement of claim was different, as the former was for possession only under Order 113, and that the latter was for possession and mesne profit. 

169.  Anyway, the originating summons did not need to be served on D2 after the Possession Order was set aside, and as pointed out by Mr Mok, the fact that D2 had applied to set aside meant that the originating process had come to his attention.

170.  As seen in Markfield, the point is that once proceedings are brought in time, the occupier cannot then seek to rely on the subsequent passage of time to establish with those proceedings a defence by way of adverse possession.  I accept Mr Mok’s submission that what matters for the Limitation Ordinance is (1) to bring an action to recover the land before the expiration of the limitation period and (2) to succeed in obtaining an order for possession in that action.

171.  In any event, as pointed out by Mr Mok, as pleaded in his defence and counterclaim, D2’s position throughout was he had already acquired an adverse possessory title over the entire Lot 841 since about 1982 and that P had been dispossessed or her title to the lot had been extinguished by the time when this action commenced in 2003.  It was not D2’s pleaded case that the Relevant Date was 18 April 2013 when the statement of claim was filed.

172.  I am thus of the view that the Relevant Date should be 3 July 2003 and not when the statement of claim was served on about 18 April 2013.

Issue (2)

173.  In any event, in light of my findings on possession and the requisite intention of D2 from 1982 until 2013, I find there was no continuous adverse possession by D2 over the entire Lot 841for a sufficient period of time before the Relevant Date, whether such date was 3 July 2013 or 18 April 2013.

Conclusion

174.  For all the above reasons, D2’s claim of adverse possession must fail and P is entitled to an order for possession of Lot 841.

Mesne profits

175.  The parties’ single joint expert RHL Appraisal Limited had submitted two reports on the calculations of mesne profits[68].

176.  There was no claim for mesne profits in the originating summons, and it was only in the statement of claim that P had claimed for mesne profits.  As said earlier, the statement of claim was filed on 18 April 2013.

177.  Mr Lau submitted that this court has the discretion to disallow the mesne profits prior to 18 April 2013 or in any event as a claim for mesne profit is an action based on the tort of trespass to land, such mesne profits should only be from 6 years prior to the filing of the statement of claim, ie from April 2007.

178.  P claimed mesne profits for 6 years before the issue of the originating summons, namely from 3 July 1997.

179.  Having considered all the circumstances of this case, including that there was no claim for mesne profits in the originating summons issued only under Order 113, and that P had chosen not to enforce the Possession Order for 10 years, I am prepared to exercise my discretion and to order mesne profits only from April 2007 until date of delivery of the possession.

180.  Mr Lau had submitted that the mesne profits which P is entitled should be as follows :-

(i) 2007: $237,600 x ½ = $118,000

(ii) 2008 - 2011: $288,000 for each year

(iii) 2012 -2013: $362,400 for each year

(iv) 2014 and after: $287,800 for each year

181.  I accept Mr Lau’s calculations.

Interest

182.  There were no submissions made by Mr Mok on any pre-judgment interest.  I will order interest on mesne profits from date of judgment only, at judgment rate.

Order

183.  My order is as follows:

(1)   D2 shall deliver vacant possession of Lot 841 to P within 28 days hereof;

(2)   D2 shall pay to P mesne profits as follows:

(i)	2007:	$237,600 x ½ = $118,000
(ii)	2008 - 2011:	$288,000 for each year
(iii)	2012 -2013:	$362,400 for each year
(iv)	2014 and after:	$287,800 for each year until delivery of vacant possession

(3)   Interest on mesne profits from date of judgment at judgment rate until full payment.

(4)   D2’s defence and counterclaim is hereby dismissed.

184.  As for costs, as P is the successful party, D2 shall pay P’s costs of these proceedings, to be taxed if not agreed on party and party basis, with certificate for 2 Counsel.  This is an order nisi which shall be made after 21 days.