WEALTH TREASURE CORPORATION LTD v. EARNEST ENTERPRISES LTD

DCCJ 1541/2013

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 1541 OF 2013

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DECISION

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1.  There is before me a very late application for an adjournment of the trial. After hearing Mr Lam and Miss Cheung, counsel for the Plaintiff and Defendant respectively, I, with some reluctance, allow the application for adjournment.

2.  The Plaintiff is the owner of the external walls of Morlite Building, an industrial building in Kwun Tong which was completed in 1970 (“the Building”).  Soon after it had acquired the ownership of the external walls (the Plaintiff became an owner of the external walls in around February 2012), the Plaintiff began to go after individual owners of the Building and demanded payment of licence fee for use of the external walls.  By a licence agreement dated 4^th May 2012, the Plaintiff granted a short-term licence to the Defendant, the owner of the 2^nd Floor, over part of the external walls of the Building.  Upon the expiration of the licence agreement, the Plaintiff sought to recover possession of the external walls and have the air-conditioners and other structures erected on the external walls outside the Defendant’s premises removed.  When the Defendant refused to remove the air-conditioners and other structures, the Plaintiff commenced this action against it.

3.  In its Defence, it is pleaded that the Plaintiff’s predecessor in title had for many years before the Plaintiff became an owner of the external walls acquiesced to the erection of air-conditioners and other structures on the external walls. As a result, it is said that:-

“the Defendant (as well as other owners of units in the building have acquired an easement over the [external walls] by virtue of their continued and uninterrupted use thereof …”

4.  Given that the parties are tenants in common, whatever rights granted over one unit in favour of its owner are not easements properly so-called: Kung Ming Tak Tong v Park Solid Enterprises Ltd. & Anor [2008] 6 HKC 42.  Although the word “quasi” does not appear in the original Defence, the easement that the Defendant has been claiming can only be taken to mean a quasi-easement in Wheeldon v Burrows sense or a contractual quasi-easement.  The facts pleaded in the Defence are indeed facts that may give rise to a quasi-easement:-

“16. When the Defendant purchased the 2^nd Floor Workshop in 2009, there were already in existence an extensive number of objects (being but not limited to signboards and brackets for air-conditioning units) affixed to the External Wall… The said objects had been affixed by the owners (or their tenants/licensees) of various units in the [Building] as of right with the knowledge and acquiescence of the Plaintiff’s predecessors in title.

17. At divers times since the development of the Building in or around 1970 and in any event for at least 20 years continuously prior to the Plaintiff’s acquisition of [the external walls], various owners of units in the [Building] have affixed objects as of right to the External Walls… with the knowledge and acquiescence of the Plaintiff’s predecessors in title.

18. … the Defendant’s predecessors in title have as of right … affixed objects and/or caused signboards to be affixed at [the external walls] again with the knowledge and acquiescence of the Plaintiff’s predecessors in title.”

5.  In this case, it is obvious that how the external walls were used has an important bearing on the determination of the issues in this case.  Unfortunately, there is not much evidence before the court as the parties’ witnesses did not become owners of the Building until fairly recently.  Days before the trial, the Defendant’s solicitors managed to locate one Mr Chan, who had been working in the Building since 1970’s.  According to the affirmation of Mr Wong Tin Chun, Mr Chan is unable to attend court on the dates set aside for trial because he is out of Hong Kong and will not return until end of September.

6.  The relevant principles in relation to applications to introduce late witness statements viewed through the prism of CJR have recently been summarised by Deputy High Court Judge Marlene Ng in Nam Ching Wun v Tsun Un Pawn Shop & Other HCA 2151/2008, unreported, date of decision: 7^th October 2014.  I do not think I can add anything useful to the learned Deputy High Court Judge’s written decision.

7.  I do share Mr Lam’s sentiments and agree that this very late application is undesirable.  I also understand his concern that the Defendant may further amend its Defence and run a new case.  Miss Cheung, in trying to address Mr Lam’s concern, states that her client is willing to offer an undertaking not to further amend the Defence.

8.  Mr Lam also challenges the Defendant’s evidence as to the availability of Mr Chan. He says that the whereabouts of Mr Chan can be easily ascertained and argues that the application for adjournment is nothing but a premeditated plan to delay the matter on the part of the Defendant and its solicitors.  I can see the force of Mr Lam’s arguments but am unable to conclude that the application for adjournment is the result of a premeditated plan.  After all, it is a very serious allegation that requires serious proof.

9.  On the whole, I am convinced that the evidence of Mr Chan is necessary for disposing fairly of the disputes between the parties.  With reluctance, I will, upon the Defendant’s undertaking not to further amend its Defence, exercise my discretion in favour of an adjournment.  I do that only because this whole case is likely to turn on Mr Chan’s evidence.  A retrial may become inevitable if I turn out to be wrong in not giving the Defendant a chance to call Mr Chan.

10.  Accordingly, I make the following orders:-

(1) Upon the Defendant’s undertaking not to further amend its Defence, the trial be adjourned to a date to be fixed.  The scheduled trial dates will be vacated; and

(2) All costs thrown away by reason of the adjournment, summarily assessed at $96,000, to be paid by the Defendant forthwith.

11.  I thank counsel for their assistance.