CHAN MEI HEUNG v. HAPPY TREND ENTERPRISE LTD

DCCJ 3843/2020

[2026] HKDC 1103

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 3843 OF 2020

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DECISION

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INTRODUCTION

1.  This is the Defendant’s application, by the Summons dated 9 December 2025, for leave to appeal from my Judgment handed down on 12 November 2025 (“Judgment”) where I allowed the Plaintiff’s claim for adverse possession in respect of the FX1 Area[1].   

LEGAL PRINCIPLES ON LEAVE TO APPEAL

2.  Section 63A(2) of the District Court Ordinance (Cap. 336) provides that leave shall not be granted unless the Court is satisfied that (a) the appeal has a reasonable prospect of success; or (b) there is some other reason in the interest of justice why the appeal should be heard. It appears from Mr. Koo’s submissions that D only relies on the first limb.

3.  It is well established that “reasonable prospect of success” is not a high threshold. It means an appeal with prospects that are more than “fanciful”, without having to be “probable”; Hong Kong Civil Procedure 2025, Vol. 1, §59/2A/4; Wing Tat Haberdashery Co Ltd v Elegance Development & Industrial Co Ltd, HCMP 357/2011, 8^th July 2011 at §6.

4.  For an appeal on fact, it is also well established that the appellate court will only intervene when it is satisfied that the judge had erred in principle and/or that the findings are “plainly wrong”; Ting Kwok Keung v Tam Dick Yuen (2002) 5 HKCFAR 336 at §42.

5.  Under the “plainly wrong” test, the appellate court has to be satisfied that the trial judge fell into palpable error in his finding of facts, such as where the finding was one; (a) which there was no evidence to support; (b) which was based on a misunderstanding of the evidence; or (c) which no reasonable judge could have reached; China Gold Finance Ltd v CIL Holdings Ltd, CACV 11/ 2015, 27 November 2015 at §19.

GROUNDS OF APPEAL

6.  In the draft Notice of Appeal attached to the Summons, D listed the following eight grounds:

(a)  Ground 1: I erred in holding that P’s pleaded case of continuous exclusive possession of the FX1 Area was not premised solely upon “residing” at the Shack by her and/or her family. In fact, no other specific acts of possession (apart from “residing at the Shack”), such as maintaining, repairing or replacing the fences, locking or securing the Shack, or any acts of control of the FX1 Area, after ceasing to reside there, were pleaded;

(b)  Ground 2: I erred in finding that P retained exclusive possession of the FX1 Area with the requisite animus possidendi after August 2001, when there was no evidence whatsoever (let alone compelling evidence) to support such finding;

(c)  Ground 3: I erred in law by formulating and applying the purported legal principle at §89 of the Judgment that it requires the paper owner to take back possession to the exclusion of the squatter to prevent or stop time continuing running against him. Such formulation reversed the burden of proof and created a non-existent presumption of continued possession in favour of a squatter, and is fundamentally wrong;

(d)  Ground 4: My reasoning for finding that Ngo Senior and the Husband first occupied the FX1 Area no later than 27 July 1982 is flawed and plainly wrong;

(e)  Ground 5: I erred in holding at §73 of the Judgment that, even if the initial occupation of the Occupied Area was by an unknown person, the Plaintiff could rely on such occupation to establish adverse possession. Without evidence regarding such occupation by the unknown person, or evidence of how Ngo Senior and the Husband entered into possession of the Occupied Area, there could not be proof that Ngo Senior or the Husband could rely on the previous adverse possession;

(f)  Ground 6: I erred in failing to give proper consideration and weight to the Husband’s declaration that he did not own any land or landed property, contrary to the principle in Wong Tak Yue v Kung Kwok Wai (1997-98) 1 HKCFAR 55. Such declaration, if considered properly and accorded with considerate weight, constitutes strong evidence proving that the Husband in fact did not have the requisite intention to possess the Occupied Area or the Shack;

(g)  Ground 7: I erred in finding that P had acquired the possessory title of the FX1 Area, being part of the Lot 8A, when P failed to adduce proper “surveyed” evidence defining the boundaries and extent of the FX1 Area;

(h)  Ground 8: Conclusively, by reason of the said “found continued possession without evidence”, “misapplied legal principles” and “reversed burden of proof”, my conclusion at §102 of Judgment that P has discharged the burden of proof with compelling evidence that, through herself or her family members, she was in exclusive possession of the FX1 Area to the exclusion of the paper owner and had the intention to possess the same for the requisite period of 20 years from no later than 27 July 1982 to 27 July 2002 at the latest, is fundamentally flawed.

7.  At the hearing, Mr Koo confirmed that Ground 6 was not pursued. Ground 8 is in substance a conclusion drawing from Grounds 1 to 7. The “live” grounds are therefore Grounds 1 to 5 and 7.

GROUND 1

8.  At the trial, Mr Koo had argued that P’s pleaded case on continuous exclusive possession of the FX1 Area was only based on “residing at the Shack”, with no pleaded reliance on fencing, structures, locking, or other acts of control, and I dealt with his argument at §§96 to 100 of the Judgment. In the present application, Mr Koo repeated the same argument.

9.  Paragraph 4 of the Re-Amended Statement of Claim reads as follows:-

“In or about 1982, the Plaintiff's father-in-law, Ngo Sui fenced off part of the Lot that is currently registered under the Defendant with the Land Registry (“the Defendant's Land”) together with part of the land that falls outside the Lot that was and is now an unleased government land (“the Government’s Land”) and built a 2^nd Street Hang Hau Street, Hang Hau Village, Ping Shan, New Territories (“the Squatter Shack”). As a result, a part of the Squatter Shack was and is still located on the Defendant's Land and the remaining part of the Squatter Shack was and is still located on the Government’s Land. Since in or about 1982, Ngo Sui together with Ngo Wa Lung (i.e. Ngo Sui’s son and the Plaintiff’s lawful husband) resided at the Squatter Shack and the Defendant’s Shack and the Defendant’s Land continuously and exclusively.”

10.  With respect, Mr Koo’s argument focuses only on the last sentence of paragraph 4, which refers to “residing at the Squatter Shack”, but ignores the part concerning the erection of fences and the construction and continuous presence of the Shack. Reading paragraphs 4 to 11 of the Re-Amended Statement of Claim as a whole, it is clear that P also relies on the fencing-off, and the erection of the Shack and other structures, as well as their continuous presence, rather than only on residence, as acts of “full and exclusive use, possession, occupation and control” of the Occupied Area.

11.  Thus, I am of the view that there is no merit in this ground.

GROUND 2

12.  Mr Koo challenged my finding at §101 of the Judgment, namely that P continued to be in exclusive possession and occupation of the FX1 Area (together with the Government Land) after August 2001 even though no one was residing at the Shack. He submitted that there was no evidence whatsoever indicating that P or her family retained exclusive control over the FX1 Area after August 2001.

13.  As I have pointed out at §88 of the Judgment, the family’s moving to live in the PHU and the abandonment of the Occupied Area are two separate matters and did not necessarily have any correlation. The fact that P and her family did not use the Shack as their residence does not necessarily mean that they abandoned the FX1 Area. It depends on evidence and there was no evidence to show that they abandoned the Occupied Area when they moved to the PHU.

14.  Mr Koo relied on some “contemporaneous facts proving abandonment”. With respect, these facts do not assist D:

(a)  The experts’ observation that, in 2001, the area surrounding S1 and S2 (i.e. the Shack) was “grown with wild vegetation” simply reflects that vegetation was present in 2001. In a rural setting, that is fully consistent with reduced day‑to‑day use and does not, without more, indicate abandonment;

(b)  Likewise, although the experts believe that FX1 and FX3 near the eastern and south‑eastern portions of S1 and S2 could no longer be observed and were “believed to be removed” in 2003, the Joint Report also records that there was no discernible significant change in the FX1 Area from 2001 to 2002. The relevant limitation period for the FX1 Area is from 1982 to 2002. By the time any possible partial removal of fencing took place in 2003, the 20‑year period had already expired (Judgment §93);

(c)  I accept that P’s explanation of the electricity billing records was not entirely satisfactory, and I found that she and her family had in fact moved to the PHU in or about August 2001 and that no one resided at the Shack thereafter until 2013. However, the 15/08/2013 Bill does show that the meter reading had increased by 51 units since October 2001. While that level of consumption is low and contradicts P’s case of continuous residing after August 2001, it is also inconsistent with the notion that the Shack had been abandoned in or about August 2001;

(d)  As for the facts that the Shack was far away from the PHU and it suffered recurrent flooding before the completion of improvement by the Government in 2013, they are at the most natural and do not indicate, one way or another, whether the FX1 Area was abandoned.

15.  It was my finding at §83 of the Judgment that some members of P’s family returned to reside at the Shack in 2013 and there is no appeal against that finding. There was no evidence that any predecessor of D took over possession of the FX1 Area between August 2001 and 2013. The Shack remained standing, the FX1 Area remained as a distinct unit, and there was no competing occupation when P’s family returned in 2013.

16.  Against that background, I do not see how it can be reasonably argued that I was plainly wrong to reject Mr Koo’s submissions that P had abandoned the possession of the FX1 Area from August 2001 to 2013 and instead to find that P had continuous possession of the Occupied Area notwithstanding the moving out from the Shack in August 2001.

GROUND 3

17.  Mr Koo submitted that I mistakenly reversed the burden of proof and introduced a fictious presumption of continued possession in favour of P when I said that “if the paper owner wishes to prevent time running against him, it would be necessary for him to bring the factual possession of squatter to an end and it requires the paper owner to take back possession to the exclusion of the squatter”; §89 of the Judgment.

18.  With respect, Mr Koo’s submissions are misconceived.

19.  I set out the legal principles on adverse possession at §16 of the Judgment and sub-§(8) was about the burden of proof; “The burden of proof of adverse possession rests on the squatter. The evidence required must be “compelling” in light of the serious consequence of displacing the title of a paper owner by an adverse possessor”. Nowhere did I suggest that, once some initial possession is shown, the court should presume that possession continues unless the paper owner proves otherwise.

20.  At §89 of the Judgment, I simply repeated the legal principle set out in Chambers at §86, i.e. once an adverse possessor has taken possession, time starts to run against the paper title owner and, in order to prevent time running against him, it would be necessary for the paper title owner to bring the factual possession of the wrongful possessor to an end, which would require the former to take back possession to the exclusion of the squatter, in response to Mr Koo’s argument on abandonment by moving out. It was not about the burden of proof, let alone of reversing it.

21.  I am of the view that there is no merit in this ground.

GROUND 4

22.  Mr Koo emphasized that, whilst he was not disputing that the FX1 Area had been occupied since 1982, he maintained the challenge on whether P has adduced compelling evidence to prove that it was Ngo Senior and the Husband who had occupied the FX1 Area since around 1982.

23.  Mr Koo submitted that there was evidence showing that the 4^th Street Address belonged to the Green House and he did put this to P under cross-examination. He also challenged my assessment of Ms Leung’s evidence and argued that I was wrong to accept her evidence. It is Mr Koo’s argument that I should have rejected Ms Leung’s evidence and made the finding that P had failed to adduce compelling evidence to prove that Ngo Senior and the Husband had been in occupation of the Occupied Area since 1982.

24.  With respect, I do not agree with Mr Koo’s submissions.

25.  As noted at §72 of the Judgment, while it is P’s evidence that the 4^th Street Address was once the address of the Green House, there is no evidence that the Green House was still occupied by Ngo Senior and the Husband after 1982. By contrast, P’s evidence, supported by the photograph, was that the 4^th Street Address was displayed on a metal plate affixed to the Shack.

26.  Having reviewed the transcript, I accept that Mr Koo did suggest (but not explicitly put) to P the possibility that the metal plate might have been moved from the Green House to the Shack, and that P rejected that suggestion. In any event, the precise provenance of the metal plate is not determinative.

27.  The more cogent evidence on the start date and identity of the occupiers comes from Madam Leung. I accepted her evidence that her two sons were very small when the Shack came into existence and that thereafter Ngo Senior and the Husband repeatedly repaired it. Judged against the undisputed fact that her sons were born in 1978 and 1979, this supported P’s case that Ngo Senior and the Husband first occupied the FX1 Area in about 1982. That conclusion is also consistent with the expert evidence of structures and enclosure appearing in mid‑1982.

28.  Mr Koo’s challenge to my assessment of Madam Leung’s credibility is, with respect, without substance. The fact that her evidence did not resolve the separate question of what precisely happened between 2001 and 2013 does not undermine her reliability on the much earlier period in the early 1980s.

29.  I am of the view that there is no merit in this ground.

GROUND 5

30.  Mr Koo criticized my reliance on an unknown prior occupier as unsupported by evidence.

31.  The short answer is that my comment at §73 of the Judgment was expressly a fallback position. My primary finding, based on the expert evidence and Madam Leung’s testimony, was that Ngo Senior and the Husband themselves first occupied the FX1 Area by mid‑1982. That was sufficient in itself to start time running.

32.  Furthermore, the expert evidence shows continuous occupation of the FX1 Area, as evidenced by the persistent presence of structures and fences, together with progressive building works, extensions, and site modifications over time (Judgment §58). Mr Koo’s suggested scenario of a prior squatter abandoning the land and a fresh limitation period starting when Ngo Senior moved in is hypothetical only and unsupported by any evidence. Ground 5 therefore has no realistic prospect of success.

GROUND 7

33.  The FX1 Area is clearly delineated in the Government survey sheets annexed to the experts’ respective reports and there was no disagreement on the location of FX1 between the experts. There is therefore no arguable basis for saying that the boundaries or extent of the FX1 Area are too uncertain to support a possessory title.

CONCLUSION

34.  In light of the above, I am not satisfied that it is reasonably arguable that there was any error of law or “plainly wrong” finding of fact in any of the “live” grounds. Nor has any other reason in the interests of justice been advanced. I would therefore dismiss D’s application for leave to appeal.

35.  There is no reason why costs should not follow the event. Thus, I order that D do pay P’s costs of the application, with Certificate for Counsel, to be taxed if not agreed. P’s own costs be taxed in accordance with the Legal Aid Regulations.

36.  I thank Counsel for the assistance to the Court.