MAK LAI CHUEN suing as sole manager of MAK TSOK SUI TSO v. LAU KAR YAU

DCCJ 2609/2006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 2609 OF 2006

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AND 

DCCJ 2610/2006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 2610 OF 2006

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BETWEEN

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(to be tried together)

Dates of hearing  :  16, 19 - 23 May, 6 June 2008

JUDGMENT

Background

1.  The Mak Tsok Sui Tso 麥作穗祖 ("Tso") was first registered as the owner of Lot No. 390A in D.D. 189 ("Land") in 1935.  According to the Land Register, Mak Tak Yan, Mak Yung Mau and Mak Yung Fuk were  registered then as Trustees of the Tso.  In 1940, Mak Yung Mau (麥容茂) and Mak Yung Fuk (麥容福) became the registered Trustees of the Land, with the Tso as the registered beneficiary.  They were recorded in the Land Register as having been appointed in place of Mak Tak Yan, deceased. In 1979, Mak Yuk Hon 麥玉漢 ("Yuk Hon") and Mak Lai Chuen 麥禮泉("Lai Chuen") became the registered Managers of the Land.  Again, they were recorded to have been appointed as managers in place of Mak Yung Mau and Mak Yung Fuk, deceased.

2.  It is not in dispute that Yuk Hon and Lai Chuen were at the same time registered as managers of the Land in accordance with section 15 of the New Territories Ordinance ("Ordinance"). 

3.  There is no dispute that the Tso is an entity for holding ancestral land under Chinese law and custom, as recognized under section 15 of the Ordinance.  The beneficiaries of the Tso in question comprise 4 branches of the Mak family.  Yuk Hon was a descendent of the first branch, as was Mak Yung Fuk, whom Yuk Hon replaced as Trustee and Manager upon Yung Fuk’s death.  Mak Kam Fat and Mak Pui Kuen are descendents of Yuk Hon.  Lai Chuen is a descendent of the fourth branch of the Mak family, as was Mak Yung Mau, whom Lai Chuen replaced as Trustee and Manager upon Yung Mau’s death.  Mak Tim Fat 麥添發 (“Tim Fat”) is also a descendent of the fourth branch, his grandfather being Mak Yung Mau's brother.  The second branch of the family has one surviving male descendent, Mak Chi Wah 麥志華.  The third branch of the family has no surviving male descendent.  It would appear from the evidence that the registered Trustees and Managers of the Tso come historically from the first and/or fourth branches of the family.

4.  Yuk Hon died in 1997.  Subsequent to his death, no changes were effected to the registration of Managers under the Ordinance, as members of the Tso were unable to come to agreement in relation to either cancelling the appointment of Yuk Hon as Manager, or the registration of some other Manager in place of Yuk Hon.

5.  According to the Amended Statement of Claim, Lai Chuen claims to be the "sole duly appointed approved and registered manager of the Tso".  This is denied by the Defendants named in these proceedings, and by Yuk Hon's family who are members and beneficiaries of the Tso.

6.  It is not in dispute that members of Yuk Hon's family had resided at and occupied parts of the Land since the late 1960's.  It was only at the end of 2000, that 2 Chinese Tenancy Agreements ("Agreements") were executed between the Tso and members of Yuk Hon's family.  The Agreements were signed by Mak Kam Fat 麥錦發 ("Kam Fat") and Tim Fat on behalf of the Tso.  Under the Agreements, the Tso granted a tenancy to Mak Pui Kuen麥佩娟 (" Pui Kuen") and Lau  Kar Yau 劉珈佑 ("Lau") respectively for a term of 2 years commencing 1 January 2001 to 31 December 2002 at the monthly rent of $1,000.  Each of the Agreements was subject to a term that upon the expiry of the term of the tenancy, save for Government resuming the Land, the tenant has the right to renew the tenancy.

7.  Lai Chuen as Plaintiff in these proceedings claims that on about 28 July 2005, the Tso had served on each of Pui Kuen and Lau a Notice to Quit ("Notice to Quit") and to deliver up vacant possession of the Land to the Tso on 28 February 2006.  Lai Chuen also claims that Pui Kuen and Lau had failed to pay rent from 1 July 2005 to 28 February 2006.  Lai Chuen accordingly commenced proceedings purportedly as the sole manager of the Tso on 29 May 2006 to seek from Pui Kuen and Lau vacant possession of the Land, outstanding rent in the sum of $8,000, mesne profits and interest.

8.  Pui Kuen is the daughter of Yuk Hon. Lau is the wife of Kam Fat who in turn is the son of Yuk Hon. In essence, Pui Kuen and Lau defend these proceedings on the ground that after the demise of Yuk Hon, Lai Chuen has no authority or right to act on behalf of the Tso to terminate their tenancies by service of the Notice to Quit, and has no authority or capacity to commence these proceedings as the sole manager of the Tso.  Alternatively, they claim that they have the right under the Agreements to renew their tenancy.

Issues

9.  The issues which arose for determination at trial are :

(1)   whether Pui Kuen and Lau have the right or power to challenge Lai Chuen's authority to act for the Tso to terminate the tenancies under the Agreements and to commence these proceedings against Pui Kuen and Lau to seek possession of the Land occupied by them;

(2)   if Pui Kuen and Lau have the right to challenge Lai Chuen's authority, whether Lai Chuen in fact has the authority to act for the Tso to terminate the tenancies under the Agreements, and to commence these proceedings against Puen Kuen and Lau to seek possession of the Land occupied by them;

(3)   if Lai Chuen has the authority to act for the Tso, whether Pui Kuen and Lau have the right to renew the tenancies under the Agreements.

Whether Pui Kuen and Lau have the right or power to challenge Lai Chuen's authority to act for the Tso to terminate the tenancies under the Agreements, and to commence these proceedings against Puen Kuen and Lau to seek possession of the Land occupied by them

10.  Lai Chuen claims that upon Yuk Hon's death in 1997, he as the surviving registered Manager of the Tso became the sole and duly authorized Manager with authority to act for the Tso.  Lai Chuen also claims that Pui Kuen and Lau have no right to challenge his power and authority as Manager of the Tso, whether as tenants, or as female family members.

Does tenancy by estoppel apply ?

11.  Pui Kuen and Lau do not  deny the title of the Tso as landlord under the Agreements.  They accept that the Tso is the landlord under the Agreements.  They only claim that Lai Chuen has no right or authority to act in the name of the Tso to instruct solicitors to serve the Notice to Quit or to commence these proceedings.  They highlight in their evidence that the Agreements were signed by Kam Fat and Tim Fat, and not by Lai Chuen, on behalf of the Tso.

12.   I consider that estoppel by tenancy does not apply on the facts of this case to prevent Pui Kuen and Lau to challenge Lai Chuen's authority as they have done in this case.  The Agreements were signed not by Lai Chuen, but by Kam Fat and Tim Fat on behalf of the Tso as landlord.  On the evidence, after dispute had arisen between the first branch and the fourth branch of the Tso as to who has the right to be appointed as Manager upon Yuk Hon's death, members of the Tso had agreed as an interim measure in 2000 that Kam Fat from the first branch and Tim Fat from the fourth branch should represent the Tso to enter into the Agreements with members of Kam Fat's family, setting out the conditions whereby Kam Fat's family could reside on parts of the Land.  Pui Kuen and Lau claim that the fact that Lai Chuen did not sign the Agreements on behalf of the Tso is itself evidence that Lai Chuen recognized that after Yuk Hon's death, he did not have power or authority to represent the Tso.

13.  Bearing in mind that as evidenced by the Agreements, the persons purporting to grant a lease of the Land to Pui Kuen and Lau are Kam Fat and Tim Fat acting for and in the name of the Tso, I consider that Pui Kuen and Lau are not estopped from denying the right of Lai Chuen to terminate their tenancies and to commence these proceedings in purported reliance on and enforcement of the Agreements.

14.   Counsel for Lai Chuen relies on the judgment of Cheung, JA in the case of Tang Man Kit and Foo Tak Ching (suing as Managers of Wah Yan Mo Fan Heung) v. Hip Hing Timber Company Ltd. CACV  137/2002, 13 May 2005, where he said:

"In my view, irrespective of the question of whether the managers would only acquire a legal title to the land upon the registration of the approval by the District Officer, the right of the managers as landlords and as persons entitled to possession to recover the land can hardly be challenged."

15.  Counsel argues that irrespective of whether Lai Chuen is registered or approved by the District Officer as Manager of the Tso, Lai Chuen as landlord and the person entitled to possession has the right to recover the Land.  On the facts and evidence presented in this case, the question of whether Lai Chuen as the surviving Manager of the Tso upon Yuk Hon's death is entitled to possession of the Land is disputed on the basis that under Chinese customary law, where two or more persons are appointed as managers of the Tso, they act jointly and have joint power and authority to act. On the death of one of the jointly appointed managers, the survivor does not automatically assume full power and authority and the members of the Tso must agree either to appoint the surviving manager as the sole manager, or otherwise agree to appoint someone else to replace the deceased manager.  If I accept this to be the case, then Lai Chuen as the surviving manager does not, on Yuk Hon's death, have the full right to possession of the Land to form the basis of his authority to recover possession from Pui Kuen and Lau under the Agreements.  The facts of this case are accordingly distinguishable from those in Tang Man Mit (supra).  I deal with the question of Lai Chuen's right to terminate the tenancy granted under the Agreements, and his right to commence these proceedings in more detail below, under the second issue.

Do female family members have the right to challenge Lai Chuen's authority ?

16.  Processor Chang Wejen’s Expert Report dated 5 October 2007 was produced by Pui Kuen and Lau in these proceedings as expert evidence on Chinese customary law.  Professor Chang also gave evidence at the trial. With regard to Pui Kuen's capacity as daughter of Yuk Hon and Lau's capacity as wife of Kam Fat and daughter-in-law of Yuk Hon, and with regard to the rights of Yuk Hon's widow, Madam Wai, Professor Chang's expert evidence is as follows.  The wife of a member of a Tso, although not literally being a member, has the same rights as her husband.  Lau therefore has the same rights as Kam Fat.  Madam Wai who resides with Pui Kuen and Lau on the Land has the same rights as Yuk Hon. An unmarried daughter has certain rights to the Tso property and in the case of a married daughter who takes care of an elderly parent such as Madam Wai, the daughter is given preferential treatment by the Tso.  From the evidence of Professor Chang, this is consistent with the very purpose of the creation of a Tso, which is to take care of present and future members of the family and the clan, and particularly members of the family who are in need.  In fact, on the evidence of Madam Wai, senior members of the Tso had originally permitted her to occupy the Land with her family without asking for rent because they had sympathy for her need to raise a large family of 7 children.  When disagreement arose after Yuk Hon's death, and members of the fourth branch of the Tso challenged the right of Madam Wai, Pui Kuen and Lau to occupy the Land without paying rent, the Agreements were made in 2000 as a compromise and they were signed by Kam Fat, Tim Fat, Pui Kuen and Lau and witnessed by Madam Wai.

17.   No evidence has been produced by Lai Chuen to challenge Professor Chang's evidence as to the rights of female family members such as Pui Kuen and Lau.  On the strength of Professor Chang's clear evidence, I find that Pui Kuen and Lau have the right to challenge Lai Chuen's authority to act for the Tso in this case.

If Pui Kuen and Lau have the right to challenge Lai Chuen's authority, whether Lai Chuen in fact has the authority to act for the Tso to terminate the tenancies under the Agreements, and to commence these proceedings against Puen Kuen and Lau to seek possession of the Land occupied by them

18.  Counsel for Lai Chuen claims that Lai Chuen was registered with Yuk Hon in 1979 as Managers of the Tso.  On Yuk Hon's death in 1997, Lai Chuen claims that he became the sole Manager under section 15 of the Ordinance, with the full power to dispose of or deal with the Land as if he were the sole owner.  Lai Chuen also claims he has the full power and authority to manage the Tso, including taking action against wrongful occupiers such as Pui Kuen and Lau for recovery of land and arrears of rent, which are matters of the Tso's internal administration.

19.  Section 15 of the Ordinance provides that when land is held in the name of a clan, family or tong, such clan etc. shall appoint a manager to represent it and every such appointment shall be reported at the New Territories District Office.  The Secretary for Home Affairs on receiving such proof as he may require of such appointment shall, if he approves thereof, register the name of the manager "who shall, after giving such notices as may be prescribed, have full power to dispose of or in any way deal with the land as if he were sole owner thereof, subject to the consent of the Secretary of Home Affairs".  Section 15 of the Ordinance goes on to provide that "every instrument relating to land held by a clan, family or tong, which is executed or signed by the registered manager thereof in the presence of the Secretary for Home Affairs and is attested by him, shall be as effectual for all purposes as if it had been executed or signed by all the members of the said clan, family or tong". 

20.    Counsel relies on the case of Chan Choy Fong v. Secretary for Home Affairs [1998] HKLR 431, to submit that it is not necessary to remove a deceased Manager of the Tso under section 15 of the Ordinance, as a Manager's authority is terminated on his death. 

21.  Whilst it was held in Chan Choy Fong that the office of a Manager vacated by the death of the Manager, I do not accept Chan Choy Fong as authority for the proposition that in a case where more than one Managers are registered under section 15, the surviving Manager has power to act for the Tso upon the death of the other.  That was not in contention on the facts of Chan Choy Fong, as both managers who had been appointed had died, and the question was whether upon their demise, their registration or appointment had to be "cancelled" by the Secretary for Home Affairs.  Section 15 of the Ordinance does not make express provision for the matter in issue in this case, and in view of section 13 of the Ordinance, the court has power to and should recognize and enforce any Chinese custom or customary right affecting land in the New Territories.

22.  According to the evidence of Professor Chang, where 2 Managers are appointed for a Tso, they must act jointly.  Since each was appointed as a co-manager, each has one-half of the authority to act only.  Professor Chang was adamant that this would not be changed by the death of one co- manager : the deceased manager's one-half power or authority does not automatically transfer to the surviving manager.  According to Professor Chang, if this automatic transfer of half of the power to the surviving manager is to take place, it will in fact contradict the original agreement amongst the Tso members to have 2 managers appointed, and work against the members' intention to have 2 managers come to consensus on decisions for the general interest of the Tso as a whole.  Hence, according to Professor Chang, if one co-manager unfortunately dies, another manager must immediately be appointed so as not to prejudice the welfare of the Tso. 

23.  In this context, I would mention that there is dispute between the parties as to whether the Tso had an established custom of having 2 Managers appointed for the Tso, one from the first branch and one from the fourth branch of the family.  Kam Fat's family from the first branch contends that such was the tradition and custom, whilst Lai Chuen who comes from the fourth branch denies this was the case.  Lai Chuen claims that it was only in 1940 that Mak Yung Mau from the fourth branch and Mak Yung Fuk from the first branch were appointed as co-managers, followed by Yuk Hon's and Lai Chuen's appointment as co-managers in 1979.  Before then, there had been occasions when the Tso had 1 manager, or 3 managers.  Professor Chang is of the view that although appointments from the first and fourth branches as co-managers occurred only twice in the past 50 years, more than half a century has passed without the Tso deciding to change such practice.  Considering the pace at which social circumstances in the past 50 years have changed, Professor Chang considers that 50 years or 2 generations is a reasonably long period of time and if an arrangement has been accepted without challenge during these 50 years, such arrangement would have good reason to continue.

24.    Whilst Professor Chang agrees with Counsel for Lai Chuen that if circumstances of the Tso have changed since the original appointment of 2 co-managers, members of the Tso may and can decide by majority to have only one Manager appointed, he remains of the view that the members of the Tso have actually to decide on the appointment.  They may, by majority decision, appoint the surviving manager (or someone else) as the sole manager, or appoint someone to replace the deceased manager to act with the other surviving co-manager, or appoint 2 new managers altogether.  However, according to Professor Chang, this procedure of decision by the members of the Tso as a whole must take place to establish an appointment, and there is no automatic transfer of power from the deceased Manager to the surviving Manager.

25.  Further, Professor Chang is also clear in his evidence that even if there was a majority decision to vacate the registration of Yuk Hon as a Manager, such a decision is not the same as a decision that the surviving manager becomes the sole manager with full authority in the absence of such a decision having been made by the majority of the members of the Tso.  Professor Chang explained that it is only logical to say that a deceased person should be removed from the management team but it does not follow that the surviving manager is to be the sole manager with full power unless that is the intention and decision of the members of the Tso as well.

26.  Irrespective of whether or not there is an established practice or custom of the Tso to have 2 Managers appointed from respectively the first and fourth branches of the family, the fact remains that in 1979, there were indeed 2 Managers appointed.  According to the expert evidence, each of Yuk Hon and Lai Chuen only has 50% power and authority to represent the Tso, and on Yuk Hon's death, this does not change and Lai Chuen does not automatically become the sole Manager with full power and authority to represent the Tso.

27.  Lai Chuen relies on his notification to the District Land Office on 18 December 1997, whereby he gave notice of the death of Yuk Hon.  It is claimed that the notification was supported by 11 members of the Tso including Lai Chuen.  Even if this should be construed as evidence of the decision by the 11 members of the Tso in question, and I make no findings in this respect since the Notification does not make any mention of the request or fact of cancellation of Yuk Hon's registration as Manager on his death, Kam Fat's evidence is that no notice had ever been given to Kam Fat's family of any meeting or discussion of any decision to be made by the Tso to cancel or vacate Yuk Hon's registration as Manager. 

28.  According to the expert evidence of Professor Chang, decisions by the Tso, and in particular important decisions such as decisions to select or vacate a Manager and decisions to evict members of the family of the Tso from Tso property, must be decided by the majority of all the members of the Tso, and not by the Manager himself.  In my judgment, this point which emerges from the expert evidence of Professor Chang is important and quite distinct from the issue of whether, on Yuk Hon's death, Lai Chuen as sole surviving manager has full authority to act for the Tso.

29.   Professor Chang recognizes that "majority decision" is not really a traditional Chinese concept.  In traditional China, important decisions are made not by individual members but by the head of the families of each branch of the Tso.  In the present case, it is not disputed that there are 3 surviving branches of the Mak family comprising the Tso.  The first branch of the family further divides into 4 family lines, including Yuk Hon's family line.  According to Professor Chang, each family line within the 3 surviving branches has one vote in the decision making process of the Tso.  Essentially, this means that Yuk Hon's family has one vote, Lai Chuen's family has one vote and Tim Fat's family has one vote.  In addition, there are other family lines within the Tso. According to Professor Chang, the fact that one family line did not participate in the decision making process will seriously if not fatally affect the validity of any decision affecting the Tso.

30.  It is Professor Chang's evidence that notice is a pre-requisite for any valid meeting to make decisions which affect the Tso.  Professor Chang explained that when important decisions are made concerning the Tso or Tso property, the interests of current as well as future generations of the Tso have to be considered, because the very purpose of having Tso property is to ensure that the Tso continues its bloodline and the more expressed purpose is to use the Tso property to worship ancestors.  By ensuring that each family line has notice of a meeting and the chance to vote at the meeting on decisions which affect the Tso, current and future members of the Tso can be considered to be bound by decisions made by their own family members or forefathers (including a decision not to attend and vote at a meeting of which they have been notified).

31.  I have not been referred to any evidence to show that there was notice of any meeting to Kam Fat's family or Yuk Hon's family to discuss the cancellation of Yuk Hon's registration as Manager and the appointment of Lai Chuen to act as sole Manager of the Tso, which are clearly important decisions which affect the Tso as a whole.  Indeed, Lai Chuen acknowledged in his testimony that it was pointless to serve notice of a meeting on Kam Fat's family or Yuk Hon's family because they were bound to object and to make trouble.  Nor is there evidence that the signatures of the 11 members of the Tso relied upon by Lai Chuen constitute a decision by the majority of the family lines of the 3 surviving branches of the Tso to appoint Lai Chuen as the sole Manager after Yuk Hon's death. 

32.  Counsel for Lai Chuen relies on the full Court of Appeal’s decision in Tang Man Kit and Foo Tak Ching (suing as Managers of Wah Yan Mo Fan Heung) v. Hip Hing Timber Company Ltd. (supra) to submit that until such time as the approval by the District Land Office of Lai Chuen's registration as Manager is set aside, it is not open to anyone to litigate the District Land Office's approval of Lai Chuen as Manager.  I consider that the facts of Tang Man Kit are distinguishable from the present case.  In Tang Man Kit, there was no issue of whether on the death of one of two registered Managers, the surviving registered Manager had authority to act.  Although in Tang's case, there was a succession of Managers having been appointed, the issue of the Notice to Quit, the issue of the Writ and the acts of the Managers which were challenged in the case were all acts which were made and taken by both of the currently registered Managers.  Upon the death of one Manager in Tang Man Kit’s case, another manager was appointed and registered with the approval of the District Land Office before the next controversial act was carried out.  Further, the Court of Final Appeal pointed out in Tang Man Kit's case that the Managers' authority to act was a matter of internal management of the Tso, and it was not open to outsiders to challenge or query the Managers' authority.  The tenant in Tang Kan Kit’s case was a limited company.  The tenants in this case whom Lai Chuen seeks to evict from the Land are not "outsiders" of the clan, but the wife and daughter of clan members.  According to the evidence of Professor Chang, they have the same rights as the male members of the Tso to be protected by the Tso and to enjoy the Tso property.

33.  None of the authorities cited by Counsel deal with the rights and powers of co-managers of the Tso, and the authority and power of a surviving Manager upon the death of his/her co-manager.  In the light of Professor Chang's evidence on the nature of a joint appointment of managers and the effect of the death of one co-manager on the power of the surviving manager, I find that after Yuk Hon's death in 1997, Lai Chuen did not have the right to act for the Tso to terminate the Agreements and to commence these proceedings to seek recovery of the Land from Pui Kuen and Lau.  The reasons are, first, Lai Chuen did not have full power to represent the Tso after Yuk Hon's death.  There was never a validly convened meeting of the Tso as a whole to decide on the appointment of Lai Chuen as the sole manager after Yuk Hon's death, or on the appointment of any one to replace Yuk Hon.  It is not necessary for me to decide whether the first branch and the fourth branch must be represented on the management team.  As Professor Chang has pointed out, this is for the Tso as a whole to decide at a meeting of which notice has been given to all family lines in the Tso.

34.  In this context, I accept that on Yuk Hon's death, Lai Chuen on his own does not have the full right to possession of the Land.  Accordingly, I do not accept the submission made for Lai Chuen that his right to possession of the Land is determinative of his capacity to bring these proceedings (see paragraph 15 above).

35.  Second, according to Professor Chang, the decision to terminate the Agreements had the effect and consequence of evicting members of the family clan from Tso property and this is a very important decision which must be decided not by the Manager as a matter of routine management, but by the Tso members as a whole.  The effect of the decision goes against the very purpose of putting property in the name of the Tso, which is to provide for family and clan members, particularly the elderly and needy ones.  There is no evidence of any properly convened meeting having been held before Lai Chuen instructed solicitors to issue a Notice to Quit and to commence proceedings for recovery of the Land from Pui Kuen and Lau.  Lai Chuen relies on Pui Kuen's and Lau's failure to make payment of rent to the Tso, but according to the Defendants, they were instructed to pay rent into an account which was in the personal names of Lai Chuen and Tim Fat, and not into an account of the Tso.  According to Lai Chuen, the only other bank account for payment of rent was in the name of Tim Fat and Mak Chee Kam 麥遲金 ("Chee Kam").  In my view, Pui Kuen and Lau had valid grounds to object to paying rent into an account operated in the personal names of Tim Fat and Lai Chuen, or Tim Fat and Chee Kam, and not a Tso account.  In any event, it is for the Tso members to consider and decide whether there is valid ground to complain of any breach of the Agreements and whether there are valid reasons to recover possession of the Land.  There is no evidence that the Tso had by the majority of its members made such a decision, or to authorise the recovery of the Land from Pui Kuen and Lau.  According to Professor Chang's evidence, these fall outside the routine management matters that can be decided by the manager of a Tso - even a sole/single manager.

36.  Lai Chuen's Counsel argues that as registered Manager of the Tso, Lai Chuen is a trustee within the meaning of the Trustee Ordinance.  He relies upon section 20 (1) of the Trustee Ordinance, which provides that where a power or trust is given to or imposed on 2 or more trustees jointly, such power may be exercised or performed by the survivor.  Counsel also relies on the decisions in Tang Kai Chung v. Tang Chik-Shang [1970] HKLR 276 and Leung Kuen Fai v. Tang Kwong Yu & Ors. [2002] 2 HKLRD 705.  However, the late Mills-Owens J had made it clear in his judgment in Tang Kai Chung that it is subject to the provisions of the New Territories Ordinance that the provisions of the Trustee Ordinance apply to the Tso.  In the passage of the judgment of Deputy High Court Judge Lam (as he then was) in Leung Kuen Fai which is relied upon by Counsel for Lai Chuen, the learned judge also recognized that certain concepts in English trust law are inapplicable to the Tso.  The present case does not concern "devolution of title", where general law was held (in Leung Kuen Fai) to prevail over Chinese customary law.  In the present case, there is clear expert evidence (not challenged by other evidence adduced by Lai Chuen) as to the limits under Chinese customary law to the powers of a jointly appointed Manager upon the death of his co-manager.  I cannot ignore such evidence and am bound under section 15 of the Ordinance to recognize and give effect to such custom which affects the Land.  If Lai Chuen had no authority under Chinese customary law, as the survivor of 2 jointly appointed Managers, to terminate the Tso's tendencies granted to Pui Kuen and Lau or to issue the Notice to Quit, then Pui Kuen's and Lau's interests in the Land have not been affected at all.

37.  Lai Chuen also claims that after Yuk Hon's death, he had always been treated by Government as the only Manager of the Tso.  He referred to the Demand Notes for rates, Government rent and property tax issued in respect of the Land.  However, most of the documents relied upon by Lai Chuen were issued simply in the name of the Tso.  Some were issued to the Tso, care of Yuk Hon and Lai Chuen (even after the death of Yuk Hon in 1997).  There is only one document issued in December 2006 to Lai Chuen, as a result of an interview which Lai Chuen had with officers of the Inland Revenue Department.  I consider all such evidence to be equivocal.

If Lai Chuen has the authority to act for the Tso, whether Pui Kuen and Lau have the right to renew the tenancies under the Agreements

38.  As I have ruled that Lai Chuen does not have authority to act for the Tso to terminate the tenancies under the Agreements and to commence these proceedings, it is not necessary for me to decide on the alleged right of renewal under the Agreements.

Conclusion

39.  Lai Chuen's claims against Pui Kuen and Lau in these proceedings are dismissed.  I will make a costs order nisi that Lai Chuen is to pay Pui Kuen's and Lau's costs of the actions, with certificate for Counsel, to be taxed if not agreed. 

40.  It can be seen from the evidence that a great deal of time, energy and costs have been wasted because members of the Tso have failed to come to terms and even to have meetings on matters relating to the Tso and property vested in the Tso.  Obviously, this does not make sense.  Now that the parties have had the chance to ventilate their grievances and sentiments in these proceedings, and with the benefit of the expert evidence adduced in court, it is hoped that members of the Tso can, in the interests of the Tso, meet on sensible terms to resolve all outstanding matters relating to the Tso, and not defeat the objectives set by their ancestors in establishing the Tso or frustrate the worthwhile causes the Tso was intended to achieve.