SECRETARY FOR JUSTICE v. YU CHI HUNG t/a WING KEI TYRES CO

HCMP 1933/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 1933 OF 2009

(ON AN INTENDED APPEAL FROM DCCJ NO. 2858 OF 2008)

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J U D G M E N T

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Hon Tang VP (giving the judgment of the Court):

1.  The defendant was the tenant of Ground Floor, No.8 Ivy Street, Tai Kok Tsui, Kowloon, Hong Kong (“the property”), the subject of a Resumption Notice dated 23 October 2007.  The Resumption Notice was issued following the recommendation of the Secretary for Development on the application of the Urban Renewal Authority (“URA”) under section 29 of the Urban Renewal Authority Ordinance, Cap. 563 (“URAO”).  The redevelopment project covers an area of approximately 536 square meters.

2.  On 5 July 2008, the plaintiff claimed vacant possession and mense profits in respect of the property against the defendant.  On 26 September 2008, the defendant filed a defence.  By summons dated 29 May 2009, the plaintiff applied for summary judgment.  On 7 August 2009, Master Lo entered judgment in favour of the plaintiff.  On 16 September 2009, District Judge Yung dismissed the defendant’s appeal and refused leave to appeal.

3.  On 29 September 2009, the defendant issued a summons for leave to appeal pursuant to O. 58 r. 2(4)(a) of the Rules of the District Court and O. 59 r. 2(a) of the Rules of the High Court.  The plaintiff had not filed in the Court of Appeal and served on the defendant a statement as to why the application should not be granted within 14 days of the service of the application. 

4.  On 11 November 2009, Tang VP ordered an oral hearing.  On the same day, the plaintiff’s skeleton submission in opposition was filed out of time.

5.  Since then, the defendant has become legally represented.  At the oral hearing before us, he was represented by Mr Erik Shum and Ms Linda Wong of counsel.

6.  The plaintiff was represented by Mr Anderson Chow, SC.

7.  The main defence of the defendant was and remains the defendant’s challenge on the adequacy of compliance with section 29. 

8.  It is common ground that the Secretary for Development had recommended to the Chief Executive in Council resumption under the Lands Resumption Ordinance, Cap. 124 (“LRO”), pursuant to an application made under section 29 of the URAO.  Section 29(3) requires the URAO to:

“(3) … set out in the application under subsection

(1) the following information for consideration of the Secretary-

……

(c)   for a development project, an assessment by the Authority as to the likely effect of the implementation of the development project including, in relation to the residential accommodation of persons who will be displaced by the implementation of the development project, an assessment as to whether or not, insofar as suitable residential accommodation for such persons does not already exist, arrangements can be made for the provision of such residential accommodation in advance of any such displacement which will result as the development project is implemented.”

9.  The section 29 assessment took the form of a letter dated 19 January 2007 together with 5 appendices.  The section 29 assessment contained an explicit assessment in relation to the residential accommodation of persons who would be displaced.  Mr Chow submitted that the information contained in the letter of 19 January 2007 has complied with section 29. 

10.  Mr Erik Shum relied on the fact that the letter of 19 January 2007 contained no explicit assessment regarding the impact of the project on occupiers of non-domestic premises.  That being the case, he submitted there was insufficient:

“(d)  assessment by the Authority as to the likely effect of the implementation of the development project …”.

11.  Mr Shum compared the letter of 19 January 2007 with a report prepared under section 24 of the URAO and submitted to the Secretary in February 2006 (“section 24 report”).  Section 24 is concerned with objections to projects to be implemented by way of a development project, following the publication of the project under section 23.  Section 24(3) requires URA to consider all objections and to submit:

“(d)  an assessment by the Authority as to the likely effect of the implementation of the development project …”

in terms identical to section 29(3)(c). 

12.  The section 24 report is a substantial document and was prepared according to the requirements of the Urban Renewal Strategy (“URS”) prepared under section 20 of the URAO.  Para. 11 of the section 24 report showed that within the project area, there were 15 non-domestic units including one mixed used unit and that a total of 11 non-domestic business operators were identified at the freezing survey.  Also that the non-domestic units ranged in area from 30 to 1,040 square feet and that two of them had been operating in the Tai Kok Tsui area for more than 10 years.  Of the non-domestic business operators, I understand that apart from the defendant, one other has also failed to vacant its premises.

13.  In the circumstances of this case, what we have to consider is whether or not it is reasonably arguable that there has been non-compliance with section 29. 

14.  Mr Chow has submitted that apart from the mandatory requirement that the section 29 assessment should expressly deal with the likely impact in relation to the residential accommodation of persons who would be displaced, it is a matter of judgment for the URA to decide whether or not expressly to refer to, say, non-domestic tenants who would be affected by the implementation of the development project.  Moreover, the section 29 report should not be viewed in isolation, the Secretary to whom the application to recommend resumption was made was also the recipient of the section 24 report. 

15.  It is obvious that the content of a section 29 report will vary according to the circumstances of the particular development project.  Essentially, it is an exercise of judgment with which the court should not lightly interfere.  In the circumstances of this case, we do not believe it is reasonably arguable that the section 29 report is deficient.  As Mr Chow pointed out, the section 29 assessment had also specifically addressed issues such as the number of households occupying domestic units in the affected area, the estimated re-housing demand arising as a result of the implementation of the redevelopment project, the number of re-housing units which have been reserved from Hong Kong Housing Authority and Hong Kong Housing Society, as well as the re-housing/compensation package for domestic tenants and compensation package for non-domestic tenants (who are entitled to monetary allowance only but not provision of alternative business accommodation).  A detailed list of the domestic and non-domestic properties to be resumed was also provided. 

16.  Mr Chow also submitted that the validity of the resumption order in no way depends on whether the assessment made by the URA sufficiently complied with the statutory requirement of section 29(3)(c) which only formed a distant step leading to the ultimate decision of the Chief Executive in Council.  He referred to section 19 of the LRO which provides:

“In any notice to resume any land, it shall be sufficient to state that the resumption of such land is required for a public purpose, without stating the particular purpose for which the land is required; and a notice containing such statement shall be conclusive evidence that the resumption is for a public purpose.”

17.  Mr Chow submitted that the effect of section 19 is that the resumption could not be challenged whether or not the URAO had been complied with.  We have not heard full submission on the subject and since it is our view that the defendant has not been able to show non-compliance with section 29, we express no view on this point. 

18.  For the above reasons, we refuse leave to appeal.  We also make an order nisi that there be no order as to costs.  We make such order because we are of the view that had the plaintiff filed their statement in opposition to the application within 14 days of the service of the application, the court might well have dealt with the application on paper, in which event, the hearing on 15 December 2009 would not have been required.