SOUTH CROWN DEVELOPMENT LTD v. and CHUNG KI TO (AS ADMINISTRATOR OF THE ESTATE OF CHUNG KOON KOW, DECEASED) AND OTHERS

LDCS 2000/2016

[2019] HKLdT 61

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

LAND COMPULSORY SALE MAIN APPLICATION NO 2000 OF 2016

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DECISION

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1.  This is the 5^th Respondent’s (“R5”) application for leave to appeal against our judgment dated 1^st August 2019 (“the Judgment”).

2.  We shall adopt the same abbreviations used in the Judgement. 

The Law

3.  The background of this case is summarized at paragraphs 2 to 13 of the Judgment. We will not repeat the same.

4.  Section 11AA(6) of the Lands Tribunal Ordinance (Cap 17) provides:

“(6) Leave to appeal shall not be granted unless the Tribunal, the Court of Appeal or the registrar hearing the application for leave is satisfied that—

(a) the appeal has a reasonable prospect of success; or

(b) there is some other reason in the interests of justice why the appeal should be heard.”

5.  In Ho Yuen Ki Winnie and anor v Ho Hung Sun Stanley and anor, HCMP 1009/2009, (unrep), Le Pichon JA stated at paragraph 16 of the judgment: -

“For leave to be granted, this court must be satisfied that the appeal has ‘reasonable prospects of success’. Merely showing that the appeal is ‘arguable’ and ‘not fanciful’ would not be sufficient. In my view, ‘reasonable prospects’ requires something more and, in that regard, some assistance may be derived from the test applied when setting aside a default judgment.”

6.  In KNM v HTF, HCMP 288/2011, (unrep), Fok JA stated at paragraph 9: -

“The relevant test of whether an appeal has a reasonable prospect of success under section 63A is whether the applicant for leave can show that he has an arguable case with reasonable chances of success on appeal. A reasonable prospect of success therefore means an appeal with prospects that are more than ‘fanciful’ but which do not need to be shown to be ‘probable’”.

Draft Intended Grounds of Appeal

7.  The draft grounds of appeal has 5 paragraphs but we are of the view the grounds of appeal can be categorized into 3 grounds of appeal as follows:

1)  The tribunal erred in law in failing to hold the purchase price of units belonging to R16, R17, and R19 are a true reflection of the market value of the properties (“Intended Ground 1”).

2)  The tribunal erred in law in holding the applicant took all reasonable steps to acquire R5’s unit and had treated R5 fairly (“Intended Ground 2”).  

3)  The tribunal erred in holding that it is “not in any position to address any grievance one may have about the public auction system being mandated in the Ordinance,” and erred in refusing to adopt a “more broad-brush approach” in the assessment of the redevelopment value. The tribunal has no statutory basis in adopting a valuation method which uses direct comparables and which makes “every minute adjustment down to almost each and every unit.” (“Intended Ground 3”)

Intended Grounds 1 and 2

8.  We have given full reasons for our decision on why we did not accept the purchase price of units belonging to R16, R17, and R19 to be a true reflection of the market value of the properties (see paragraphs 48 – 63 of the Judgment). We do not intend to repeat the same.

9.  We have considered Mr Chain’s written submissions but do not find his submissions to be persuasive.

10.  Contrary to paragraph 5 of Mr Chain’s submissions, dated 2 October 2019, we did not make any finding that the figures were “irrelevant”. Our finding was that the figures, not being a true reflection of the market value of the said properties, cannot be used as a meaningful comparison figure in determining whether the offer made to R5 was fair.

11.  It is clear we had considered the nature of the figures, and had considered whether the figures could be utilized in arriving at our assessment and findings.  After consideration, we came to a decision the said figures could not be utilized. We therefore fail to understand how, as submitted by Mr Chain, we have “ignored/not take into account a relevant consideration.”

12.  We see no reasonable prospects of success in these intended grounds of appeal.

Intended Ground 3

13.  We believe the real crux of the present appeal lies in this intended ground of appeal. Mr Chain is essentially challenging the valuation methodology adopted by this tribunal.

14.  We have already dealt with the same in paragraphs 83 – 91 of the Judgment.

15.  The valuation methodology Mr Chain seeks to challenge has long been adopted, and accepted by members of this tribunal and expert witnesses that have come before this tribunal, as being the proper approach in evaluating the redevelopment potential of a site.

16.  We reiterate we have not been provided with any alternative method of valuation which is workable or viable. Furthermore, there has not been any expert evidence to support Mr Chain’s submissions on an alternative approach which should be adopted by this tribunal.  

17.  In absence of any expert evidence on a possible alternative methodology for evaluating the redevelopment potential of a site which is both workable and acceptable to the experts in the field, we do not find Mr Chain’s submissions to be arguable, or to have any reasonable prospects of success.

Decision

18.  For reasons given hereinabove, we are not persuaded we have erred in a point of law in the Judgment. We are of the view there is no reasonable prospect of success in the intended grounds of appeal and we do not find there to be some other reason in the interests of justice why the appeal should be heard.

19.  We dismiss R5’s application for leave to appeal against the Judgment. We make a costs order nisi that R5 do pay the applicant’s costs of the appeal, to be taxed on the High Court scale if not agreed, with certificate for counsel. Unless any party applies to vary the costs order within 14 days from the date of this Decision, the costs order shall become absolute.