NALBO, RABIN KUMAR v. UGURLU, MEHMET

LDPD 649/2014

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

APPLICATION NO. LDPD 649 OF 2014

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REASONS FOR DECISION

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BACKGROUND

1.  This is an interlocutory application taken out by the Respondent on 22 April 2014 seeking leave to appeal against the Judgment/Order/Decision made on 10 April 2014. After hearing the parties on this application on 28 April 2014, I refused to give leave to the Respondent to appeal against the Tribunal’s order dated 10 April 2014, with reasons to be handed down in writing.  I now do so.

2.  Previously the applicant, as landlord, and the respondent, as tenant, entered into a tenancy agreement dated 29 December 2012 by which the applicant let to the respondent the premises at Flat A, 11/F, Yen Chun Building, 18-26 Portland Street, Kowloon (“the Premises”) for a fixed term of 1 year from 5 January 2013 to 4 January 2014 at a monthly rent of HK$11,000 inclusive of management fee and rates, etc.  There was no rent free period stipulated in the tenancy.

3.  The tenancy expired on 4 January 2014 and the respondent was allowed to hold over.According to the respondent, he and the applicant had agreed his stay to continue for another two years starting from 10 January 2014 at HK$11,000 per month (ie the same rental as before). The respondent also alleged that he was not required to pay rent for the first month (ie from 10 January 2014 to 9 February 2014) as set-off for the repainting of the Premises. More emphatically, the respondent asserted that he and the applicant agreed to make a 2-year contract for tenancy at HK$11,000 per month because such a written contract was required for his submission to his employer in Canada for reimbursement of the rental as housing allowance and for tax purposes.

4.  Notwithstanding the above, in the Notice of Application filed to the Tribunal on 22 March 2014, the applicant applied for recovery of possession of the Premises and rent as the respondent has failed to pay rent from 5 February 2014, and applied for order for mesne profits to the date of delivery of vacant possession of the premises and costs (“the Application”). 

5.  The respondent filed a Notice of Opposition on 25 March 2014. He said that the rental for the period from 10 February 2014 to 9 March 2014 was paid on 12 February 2014 (HK$6,000) and 17 February 2014 (HK$5,000) respectively. As regards the rental for the period from 10 March 2014 to 9 April 2014, he only paid HK$5,000 (partly in renminbi and partly in Hong Kong dollars) on 15 March 2014 but would pay the balance of HK$6,000 if the applicant could provide him with an original hard copy of signed tenancy agreement for 2 years.

6.  The respondent also complaint that on 20 March 2014, the applicant sent him a notice alleging the February 2014 and March 2014 rentals were in arrears and requiring him to move out.

7.  During the hearing on 10 April 2014, the respondent failed to prove that the applicant had agreed to allow him to set off the January 2014 rental by repainting of the Premises. Initially the respondent accused the applicant for changing his mind and subsequently the respondent agreed to pay back the January 2014 rental anyway. Having said so, the respondent insisted that the applicant should provide him with a hard copy of signed tenancy agreement for 2 years.

8.  The applicant, on the other hand, considered the rentals paid by the respondent on 12 February 2014 and 17 February 2014 respectively were rental for the period from 5 January 2014 to 4 February 2014.  The applicant disagreed that the new oral tenancy should commence on 10 January 2014 instead of 5 January 2014. Here, the respondent responded that he should be given a rent free of 5 days for removal; he argued this was a normal practice in Hong Kong, trying to support this with a tenancy agreement for an office premises elsewhere. I ruled that the tenancy agreement for another premises unconnected with the subject was irrelevant and the alleged rent free of 5 days was unsupported.

9.  There was also a dispute between the parties on whether the payment made by the respondent on 15 March 2014 amounted to HK$5,000 as ¥3,110 and HK$1,050 were actually paid. But as I found the applicant was willing to accept that payment initially, he could not change his mind when he later found the exchange rate was not in his favour.

10.  Whereas the respondent insisted that his agreement with the applicant for a new tenancy should be put into writing and signed, it would be readily implied that there was intended to be no contract until the written tenancy be signed[1]. On the other hand, a tenant holding over after a term of year(s) at a monthly rent acquires an oral monthly tenancy, a situation acknowledged by the applicant in his Notice of Application on 22 March 2014. This monthly tenancy is particularly recognized by law in Hong Kong when the tenancy is for a term not exceeding 3 years at the best rent which can be reasonably obtained without a premium[2]. In any event, I was not in the position to compel the applicant to provide the respondent with a written tenancy agreement whatsoever. A monthly tenancy is however determinable by a one-month notice to quit served by either party so as to expire at the end of a complete period of the tenancy.

11.  Having heard the submissions by the parties therefore I made the Orders as follows :    

(1) Subject to paragraph (4) below, the Respondent do deliver vacant possession of the suit premises known as “Flat A, 11/F, Yen Chun Building, 18-26 Portland Street, Kowloon” to the Applicant;

(2) The Respondent do pay the Applicant arrears of rent/mesne profits as follows:

(i) Balance of arrears of rent from 5 February 2014 to 4^th April 2014 in the sum of $17,000;

(ii) Arrears of rent/mesne profits at the rate of $11,000 per month from the 5^th  April 2014 until delivery up of vacant possession;

(3) The Respondent do pay the Applicant the costs of this Application which is summarily assessed at $365;

(4) If the Respondent should on or before 25April 2014 (“Relief Expiration Date”) pay to the Applicant all the arrears of rent/mesne profits as stated in paragraph (2) above (including all arrears of rent/mesne profits due on or before the date of payment) together with the costs referred to in paragraph (3) above, the Respondent be relieved from the forfeiture incurred herein, and the lease of the suit premises be reinstated.

RESPONDENT’S INTERLOCUTORY APPLICATION

12.  In the respondent’s interlocutory application of 22 April 2014, he attached an affirmation of 2 pages and supporting documents of 15 pages.  Nevertheless, the respondent was mainly repeating his submission as contained in his Notice of Opposition and during the hearing on 10 April 2014. The respondent also stated his intention to move out and hoped his liability for payment in the sum of HK$28,365 could be reduced from his deposit paid (in the sum of HK$22,000). On hearing of this application for leave to appeal, the respondent produced evidence that he had deposited therefore HK$6,365 (ie HK$28,365 - HK$22,000) into the applicant’s bank account on 23 April 2014. He submitted that he was hesitant to pay the outstanding balance because he was afraid that the applicant might not return the deposit to him when he moved away from the Premises say on 4 May 2014.

13.  On being asked whether he was given a copy of the Lands Tribunal’s pamphlet for the general public (including the parties in this type of applications) titled “Notes on review and appeal for parties’ attention”, the respondent answered in the affirmative but he said he could not accept the existence of an oral monthly tenancy; a tenancy must be in writing so that he could seek reimbursement of the rental as housing allowance from his employer and for tax purposes.

14.  I reminded the respondent that I could not see how these grounds put forward by him in this interlocutory application could be taken as issues on the “point of law”. However, the respondent still could not point out the “point of law” involved in the Tribunal’s order of 10 April 2014 even after I read out in open court the relevant section, section 11(2) of Cap. 17, Lands Tribunal Ordinance (“the Ordinance”), regarding this point:

“Subject to section 11AA and the provisions of any Ordinance relating to appeals from the Tribunal, any party to proceedings before the Tribunal may appeal to the Court of Appeal against a judgment, order or decision of the Tribunal on the ground that such judgment, order or decision is erroneous in point of law. “ (Amended 3 of 2008 s.39)

15.  As regards the issue on deposit, Clause 7 of the original tenancy agreement dated 29 December 2012 stated the deposit was a security for the due observance and performance of the terms and conditions of the tenancy. More particularly, “(p)rovided that there is no antecedent breach of any of the terms and conditions herein contained, the Landlord shall refund the Security Deposit to the Tenant without interest within 7 days from the date of delivery of vacant possession of the Premises to the Landlord or settlement of any outstanding payment owed by the Tenant to the Landlord, whichever is later.” Thus, prior to the respondent’s delivery of vacant possession of the Premises to the applicant, the latter has no obligation to treat the deposit as part of the rental payment due.

LEAVE TO APPEAL

16.  Section 11AA (6) of the Ordinance provides that:

“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.”

DISCUSSION

17.  Summing up, since the grounds stated by the Respondent as the grounds of appeal were the “findings of facts” which formed the basis of the Tribunal’s order of 10 April 2014, and more importantly, were not issues on the “point of law”, I cannot see how the Respondent should be given the leave to appeal.  

18.  This is originally a simple application for recovery of possession and payment of outstanding rent/mesne profit and costs.  Under the order granted by me on 10 April 2014, the respondent had a relief period for payment of outstanding rent and costs by 25 April 2014, failing which the applicant has the right to obtain vacant possession of the premises.  Since the respondent failed to pay the outstanding rent and costs in full by the Relief Expiration Date, the applicant may proceed to apply for writ of possession of the premises.

19.  Since both parties are not legally represented, I decide not to make any cost order for this application.

CONCLUSION

20.  The interlocutory application by the Respondent to seek leave to appeal is dismissed. There be no order as to costs.

[1]See Halsbury’s Laws of Hong Kong,  Vol. 17(1) (LexisNexis, 2007 Reissue) para. 235.049.

[2]See section 6(2) of the Conveyancing and Property Ordinance, Cap 219.