GOVERNMENT TEACHERS' CO-OPERATIVE BUILDING SOCIETY LIMITED v. ATTORNEY GENERAL

1987 M.P. No. 1103

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

MISCELLANEOUS PROCEEDINGS

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JUDGMENT

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1. In April 1957, the Government of Hong Kong granted the applicants a lease for 75 years of Inland Lot No. 7372 in King's Road, Hong Kong. In October 1970, a Crown Lease of the lot was granted and this superseded the 1957 agreement and lease conditions.

2. The applicants cut into the hillside forming part of the lot and constructed a platform upon which were built two blocks of flats, each containing 8 units. These are 992-998 Kings Road. The hillside to the south-west of lot 7372, which was still Crown land, was cut back to form a natural slope at an angle of 60^o. This was not covered or retained in any way but drainage channels were built at the top of the slope.

3. Subsequently, other blocks of flats were built to the south-east of the applicants' property but because they had a different orientation, they were deemed to be in Mount Parker Road, not King's Road. These were lots 7756 (2-8 Mount Parker Road), 7856 (10-12 Mount Parker Road) and 7743 (14-16 Mount Parker Road). The hillside behind these other blocks was also apparently covered by trees and natural vegetation.

4. In July 1977, as result of very heavy rains and a general concern regarding the stability of slopes in the area, the applicants received a letter from the Crown Land and Survey Office requesting that the slope behind the applicants' property be thoroughly investigated by a geotechnical engineer to ascertain its stability. An architect was duly appointed by the applicants and he produced a report in June 1979. This report was not considered adequate either by the Government or by the applicant and a further report was requested.

5. Eventually, on the 16th of April 1982, a notice was served on the applicant by the Building Authority pursuant to S.27A of the Building Ordinance. It is this notice which forms basis of the claim which the Authority has against the applicant and from which the applicant seeks judicial review. This notice reads as follows :-

"I am of the opinion that natural, formed or man-made land to the South-west of I.L. 7372 is liable to become so dangerous that it will collapse or be likely to collapse either totally or partially and thereby cause risk of injury to persons or damage to property.

 

In exercise of the powers vested in me by S.27A of the Buildings Ordinance, I hereby declare that such natural, formed or man-made land is liable to become dangerous and I hereby order you as the person who under the terms of a Crown Lease is under an obligation to maintain the land to carry out within a period commencing on the 17th May 1982 and expiring on 3rd December 1982 the following works:-

 

 

Signed

Lok Che Leung

pro Building Authority"

A similar notice was served on the owners of 2-8 and 10-12 Mount Parker Road but not on the owners of 14-16. This latter block of flats, although it shares a common access road, was further to the south-east of the slope which was considered to be dangerous.

6. There was then an exchange of correspondence whereby the applicants maintained that their slope showed no sign of instability and declined to undertake the work required by the S.27A notice. Finally by a letter dated 31st August 1982, the Building Authority said that it considered that the applicant was liable, pursuant to the lease conditions, for any possible deterioration of the safety of the slope and that arrangements were already underway, pursuant to Subsection (3) of S.27A of the Buildings Ordinance, to carry out the worked required by the notice. By a letter dated the 6th of July, the Building Authority again advised that the work would be carried out by government in default of compliance with the notice and that the costs would be recovered from the applicant. This was replied to on the 15th of July and the applicant again reiterated that it did not consider that under the lease conditions, it was responsible for carrying out the remedial work on Crown Land.

7. A consultant was appointed by the Building Authority and eventually on his recommendation, remedial works to the entire slope were completed on the 5th of April 1986. These were substantial works involving the removal or stablizing of boulders which were considered dangerous, covering a great deal of the slope behind the Mount Parker Road flats with Chu Nam Plaster, which itself has no strength but acts as a membrane, a further cutting back of the slope to a less steep angle and the installation of a substantial amount of new drainage in addition to repairing existing channels. The total cost of this work, including the provision of an access road, payment of consultant's fees and supervision time, came to $2,058,880. The applicants were held by the Building Authority to be liable for a proportion of this amounting to $875,615 this sum having been calculated by taking the length of the foot of the total slope excluding a small portion which was not to the rear of any of the flats and dividing this by the length of the relevant lots. The applicant's lot is considerably longer than any of the others. A demand note was issued and the Building Authority informed the applicant that failure to pay it would result in the claim being registered against the title, pursuant to S.33 of the Buildings Ordinance.

8. Figures have been produced showing the composition of the total amount of the cost of all the work. So far as the apportionment of that cost between the 3 owners is concerned, affidavits have been filed by Mr. Daniel Sin Cheng Yang who is one of the occupants of the applicants' flats and is a qualified engineer, stating that from the drawings and other documents in the possession of the Building Authority, it should be possible to calculate the cost of the work in relation to each block of flats. He points out that the slope behind the applicant's block has a different orientation to the others and is lower and less steep. Each slope has been given a different demarcation number by the Geotechnical Control Office. He also points out that there were a large number of boulders above the other flats which had to be removed or stablized and this was entirely to prevent danger to the Mount Parker Road blocks. Mr. Yang's own assessment that the cost of the remedial works carried out above the applicant's flats should be no more than 20% of the total costs expended on the site. This is considerably less than the 42.5% which they had been asked to pay. He considers that the slopes can be subdivided so as to relate to the flats which are in front of them and that, with access to all the various documents which are in a possession of the Building Authority, an estimate could be calculated which would be much more accurate than the method which has been used. Mr. R.S. Howes, the Chief Building Surveyor/Works of the Buildings Ordinance Office, while disagreeing with Mr. Yang as to what drainage works were carried out, agrees that 20% of the total costs in relation to lot 7372 may well be reasonable. However a lot of the work such as the access road, drainage, temporary works and consultant's fees were common to all lots. He considers that the costs could be apportioned in various ways but that no one method would ever be entirely accurate.

9. There are 2 issues to be decided. The first is whether, pursuant to the lease conditions the applicants are liable for any of the costs which have been incurred. The relevant part of these lease conditions reads as follows:-

"And where any cutting away, removal or setting back of adjoining, adjacent or nearby hillside or banks or any building-up or filling-in is or has been required for the purpose or in connection with the formation, levelling and development of the demised premises or any part thereof, the said leasee will construct or bear the cost of the construction of such retaining walls or other support, as shall or may at any time become necessary to protect and support such hillside and banks and the demised premises and to obviate and prevent any falling away, landslips or subsidence occurring thereafter and will at all times maintain the said retaining walls or other support in good and substantial repair and condition."

It is the argument for the applicants that they have not "constructed" any retaining wall or "other support" and therefore are under no obligation to maintain such wall or support in repair. They say that when their lot was developed, the slope was cut back to an angle of 60º and that natural vegetation was allowed to cover it. This made it naturally stable. They did not construct anything apart from cutting back the hillside. That cutting back cannot be considered to be supporting the hillside above as any cutting of the hillside must weaken, not support it. It is the argument for the Building Authority that it is not so and that looking at the word "support" in the context of a Crown Lease, it means any method by which the hillside above the slope is prevented from collapse. While this can be done by a retaining wall or other mechanical method, one way of ensuring the stability of the slope is to cut it back to a less steep angle and this is what the applicants were allowed to do. It is by far the cheapest and most convenient method of supporting a hillside and is used in Hong Kong extensively. Furthermore it is their contention that the provision of drainage, again in the context of a Crown Lease, also affords support to the hillside by allowing for the rapid run-off of storm water. They say that the word "support" should not be looked at in isolation but in the context of the Crown Lease.

10. There can be no doubt that the applicants have "cut away, removed and set back adjoining, adjacent or nearby hillside for the purpose of forming their site". There is therefore no doubt that they are liable for the cost of the construction of such retaining walls or other support as was or may at any time become necessary to protect and support that adjacent hillside and banks. Despite Miss Eu's very eloquant and well prepared argument to the contrary, I am satisfied that by cutting a slope further back so as to provide a less steep angle, support is lent to the hillside above it. This being so, I am satisfied that the cut surface on Crown Land which was made, by the applicants, and I think that is a "construction" within the meaning of the lease, must be maintained by them. That is the clear intention of the lease conditions. There is no dispute that the Building Authority did have cause to believe that the hillside above the cut-slope behind the applicant's sight was likely to become dangerous. I am therefore satisfied that, pursuant to the terms of the Crown Lease, the applicants were under a duty to comply with the notice which had been served on them pursuant to S. 27A of the Buildings Ordinance. The application for an order that the applicants are not liable for any of the cost of the remedial works done is refused.

Apportionment

11. The other point raised is the question of whether the manner in which the applicants have been held by the Building Authority to be liable for 42.5% of the total costs is reasonable. It is the applicant's case that facts and figures are available to the Building Authority which, if properly studied, would enable the Authority to make a reasonable apportionment of the work done in relation to the size, configuration and potential danger of the respective slopes behind each of the 3 blocks which were served with a S.27A notice. It is also their case that if the Building Authority decided not to serve such a notice on the owners of the flats at 14-16 Mount Parker Road, but that in fact that block of flats did benefit from the work done because at the very least it rendered save the access road to that block, they should not have to pay a proportion of that sum that the Building Authority has neglected to recover. It is the case for the Building Authority on the other hand that firstly this is a decision of the Building Authority and, pursuant to S. 44 of the Buildings Ordinance, if the applicants consider they have been prejudised by that decision they have a statutory right of appeal. The appeal tribunal is professionally qualified to hear matters of this sort which this court is not. Mrs Harstein, counsel for the Authority, referred me to R. v. Chief Contable, Ex parte Calveley⁽¹⁾ where Sir John Donaldson M.R. cited his own dicta in R. v. Epping and Harlow General Commissioners, ex parte Goldstraw⁽²⁾ where he said:-

"it is a cardinal principle that, save in the most exceptional circumstances, (the judicial review) jurisdiction will not be exercised where other remedies were available and have not been used."

However in R. v. Paddington Valuation Officer, ex parte Peachey Property Corporation Ltd.⁽³⁾ , Lord Denning M.R. held that

"certiorari and mandamus were available where the alternative statutory remedy was 'nowhere near so convenient, beneficial and effectual'."

In ex parte Waldron⁽⁴⁾ also referred to by Sir John Donaldson in Calveley, Glidewell L.J. said :-

"Whether the alternative statutory remedy will resolve the question at issue fully and directly; whether the statutory procedure would be quicker, or slower, than procedure by way of judicial review; whether the matter depends on some particular or technical knowledge which is more readily available to the alternative appellate body; these are amongst the matters which a court should take into account when deciding whether to grant relief by judicial review when an alternative remedy is available."

12. When considering the question of the apportionment of the costs of this remedial work, I should, I think, have account of the fact that there were two points in issue. The first was whether or not a construction of the Crown Lease Conditions meant that the applicants were or were not liable at all for part of this cost. This, it seems to me, while it could have the subject of an appeal to the Building's Appeal Tribunal, was essentially a matter of law. The Appeal Tribunal consists of 3 members appointed by the Governor, one of whom is nominated by the Building Authority, one shall be an authorized person i.e. a technically qualified person and one shall be appointed to represent property owners. No member of the Tribunal needs to be legally qualified. The second point that of apportionment is clearly not so much a legal problem and is one which is more appropriate perhaps for the Appeal Tribunal. The two questions however, it seems to me, were very much linked together. Furthermore, it seems to me that as the Building Authority himself is in position of all the relevant documents and also has the necessary expertise to make apportionment on a different basis to that it has used if the Building's Appeal Tribunal was of the view that the wrong system had been used, it would no doubt simply refer the matter back to the Building Authority for further consideration. I will not attempt to work out an apportionment himself and most certainly agree with Crown Counsel that it is totally inappropriate for this court to attempt to do so. Taking into account the matters referred to in Ex parte Waldron I consider that despite the statutory appeal procedure, I should consider this application for review.

13. It is very much the case for the Crown as regards apportionment that the slopes behind the various blocks of flats cannot physically be distinguished and that the lines which have been drawn on the plans produced were there for "administrative convenience" and not as indicating that there was any physical demaraction. While it is considered that, on the lower part of the slopes, there is a corner and a different orientation of the two slopes, on the upper part of the slopes where most of the work was done that different orientation disappears. The slope is then a continuous curve round the side of the hill.

14. Clearly the applicants have been under something of a disadvantage in this matter in that initially they were not aware of certain drawings which were exhibited to an affirmation of Mr Lee Shue Kwan filed on the 12th of August. Mr Lee is the Senior Building Surveyor of the Dangerous Building Section of the Buildings Ordinance Office. Mr Lee's very hopeful affidavit which set out the full history of the matter exhibited certain work orders "LSK-33" which in turn referred to certain plans, namely 90169/G1, G2A and G3A. These plans had not been made available to the applicant. These were then produced and a further affidavit was filed by Mr Yang in which he makes reference to these plans which were important in that they set out the work to be done and work carried out on the slopes behind the respective blocks of flats. Furthermore in Mr Howes' affidavit, he states that in fact there was a further plan 90169/G2A Revision A which set out the actual position following the completion of all the work. The applicants have no opportunity prior to the hearing to study this plan and make any comments upon it that they wished to do. The other matter where it seems to me that the applicants have some legitimate cause for complaint is that it was decided by the Buildings Authority that a notice under S. 27A of the Buildings Ordinance should not be served on the owners of 14-16 Mount Parker Road. This was on a basis that the remedial works did not affect that building. Whether or not that be so and from the plans produced, it seems somewhat difficult to accept that view, quite clearly the access road to 14-16 was very much in danger due to the state of the slope behind it and if the s lope had failed, then no doubt very expensive work would have been required to restore that access road. This is a factor which in my view should have been considered in coming to the apportionment of costs.

15. It was contended by the Crown that the principles set out in well-known decision of Associated Provincial Picture Houses Ltd. v. Wednesbury Corporation⁽⁵⁾ are applicable. That decision said that where a licensing authority had made a decision not to grant a licence for the exhibition of motion pictures on a Sunday to children under a certain age, the decision could not be challenged in a court if it was one which a reasonable tribunal acting within its powers could have come to even if the court itself would have come to another conclusion. If the authority has acted within its legal powers in exercising a discretion, the court should not interfere. Here it is argued that the apportionment of the costs is an administrative decision and could only be challenged if it was so totally unreasonable that no authority could possibly have come to that conclusion. It seems to me that is not the position here. As Mr Howes said in his affidavit, there were various methods available to the Authority for calculating an apportionment of the costs. It has chosen to use one method which is to divide the total costs by the length of the foot of the slope behind each respective lot. It is clearly a very simple method of calculating the amount to be apportioned to each block. I do not think it could be said to be so unreasonable that no authority could have used that method. I do not however consider that this is a situation where the decision in Wednesbury Corporation⁽⁵⁾ is relevant. There is no specific power under the Buildings Ordinance which enables the Authority to apportion costs in one way or another. S. 27A (3) provides that where a notice has been served pursuant to that section, the Authority may carry out the work specified in the order and the costs thereof shall be recoverable from the owner or person of the property. The situation where the remedial works affect more than one property is not specifically mentioned. S. 33 which provides for recovery of costs sets out that a certificate under the hand of the Building Authority may be registered against the title of the property. Sub-section 8 sets out that the certificate of the costs and that the person being sued is liable for payment thereof shall be prima facie of the facts certified therein, but this does not, in my view, mean that the certificate cannot be challenged except on the basis that it was totally unreasonable, within the Wednesbury principles. If it can be shown that a more reasonable and fairer way of apportioning the costs could have been used, then in my view the decision is open to challenge.

16. Here it seems to me that the apportionment of certain costs such as the overall drainage system, construction of the access road to the top part of the slope, the consultant's fees and other costs which clearly referred to the entire project will be difficult to apportion in any way other than that which has been used. Sofar as the contractor's fees for the actual work carried out however, it seems to me that there an apportionment based on the relevance of the work to each particular block of buildings and to the access road leading to them would be not only possible but would be a more reasonable and fairer system than that which has been carried out. In particular the costs of the removal or stabilization of the boulders above blocks 2-8, 10-12 and possibly 14-16 Mount Parker Road should have been considered. While there were rocks above lot 7372 which had to be trimmed apparently they were not required to either removed or stablized. There will be orders therefore as follows:-

17. I will hear counsel as to the question of costs. There will be general liberty to apply for further directions on 14 days notice.

18. Having heard counsel I make no order as to the costs of the application. The applicants are however entitled to the costs thrown away as a result of the adjournment on the 30th of July.

(1)    [1986] 1 Q.B. 424

(2)    [1983] 3 All E.R. 257

(3)    [1966] 1 Q.B. 380

(4)    [1985] 3 W.L.R. 1090

(5)    [1948] 1 K.B. 223