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HCSA000013/1986
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HEADNOTE
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Small Claim Tribunal adjudicator purporting to exercise power of review, setting aside order,ordering amendment of claim form and adjournment for re-hearing or otherwise.
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(1) |
Exercise of power of review per se is not appealable - power of review is regarded as something different from an "award or order" or "the determination of the review". Section 27A(3) provides that the exercise of the power of review shall not operate as a bar to an appeal by a party against the "award or order" or against the "determination of the review".
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(2) |
In the exercise of that power it is wrong to set aside an order and then order an adjournment "for rehearing or otherwise".
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(3) |
The power may be exercised by reopening and rehearing the case wholly or partly and the adjudicator hearing the review shall have all the powers as the original adjudicator including the power to amend and to conduct further inquiry. It is only when he determines the review that he may confirm, vary or reverse the previous order and not before.
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(4) |
Appeal against order prematurely setting aside order before the rehearing allowed. Appeal against other orders allowed. Case remitted to Tribunal to continue with the reopening and rehearing of the case.
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S.C.A. No. 13/86
(Claim No. TWSC 947/86) |
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IN THE SUPREME COURT OF HONG KONG
HIGH COURT
(Appellate Jurisdiction)
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BETWEEN
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FAIRVIEW PARK PROPERTY MANAGEMENT LTD
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Respondent
(Claimant) |
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AND
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LEE YUEN-YAU
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Appellant
(Defendant) |
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Coram: Hon. Hooper, J. in Court
Date of hearing: 14 November 1986
Date of delivery of judgment: 1 December 1986
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JUDGMENT
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1. This is an appeal from the decision of the adjudicator of the Small Claims Tribunal in which he made a number of orders which have been formally drawn up as follows:-
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(i) |
That the order made on the 16th May 1986 in this claim be set aside.
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(ii) |
That the claimant be at liberty to amend the Claim Form II.
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(iii) |
That service of the amendment of the Claim Form II be waived.
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(iv) |
That this claim be adjourned to a date to be fixed by the Tribunal officer for hearing or otherwise
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2. Dated this 10th day of June 1986."
3. The original claim had been disclosed on Form II as follows:-
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1. The grounds for the claim are
The defendant being the registered owner of House No. 71, 2nd Street, Section M (Sub-section 150), Fairview Park, Yuen Long, N.T. Failed to pay as demanded the amount of $2,610 being legal charges of Messrs Edmund W.H. Chow & Co. incurred in connection with breach of Deed of Mutual Covenant in respect of Lot No. 4665 in Demarcation District No. 104 registered in District Land Office, Yuen Long, by Memorial No. 217662 : unauthorised additions (Change of use, front and rear canopy, bamboo wall and storage). Such amount being due and payable by defendant in accordance with the provisions of the said Deed of Mutual Covenant.
2. The amount of the claim is calculated as follows:-
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(a) |
Legal charges of Messrs Edmund W.H. Chow & Co.
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$2,610 |
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(b) |
Collection charges (other than legal costs)
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$300
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$2,910
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Dated the 20th day of February 1986."
4. Although there is no provision in respect of the filing and serving of a defence in the Small Claims Tribunal Ordinance it appears that there is an informal form in use in that tribunal and the defendant signed such a form. It should be noted that the Court of Appeal in Hong Kong has taken the view that a defence is not permitted under the ordinance. See judgment of Leonard, J. in S.C.T. Appeal No. 8/1977.
5. It appears that there is an obligation on the adjudicator of the Small Claims Tribunal to define the issues himself.
6. I set out, however, the contents of the defence form which was filed in order to set out what the parties regarded as in issue. It reads
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"Defence to Claim No. T947/86 (here set out the number of the claim)
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I dispute the claimant's claim for the following reasons. (Each separate matter should be dealt with in a separate paragraph.)
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1. |
I deny I have committed any breach or breaches of the Deed of Mutual Covenant as alleged in the grounds for the claim.
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2. |
I do not admit that the claimant has incurred the legal charges as alleged in the grounds for the claim and/or such legal charges were incurred in connection with any breach or breaches of the Deed of Mutual Covenant as alleged.
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3. |
Were there any breach or breaches of the Deed of Mutual Covenant as alleged (which is denied) the legal charges allegedly to have been incurred should not be due payable by me in accordance with the provisions of Deed of Covenant.
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4. |
Even if the alleged legal charges had been incurred in connection with the alleged breach of the Deed of Mutual covenant such alleged legal charges were excessive and should have been assessed in accordance with the due process of law.
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Dated this : 10th March 1986 |
Signed |
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Name and Address of Defendant |
HENRY LEE YUEN YAU of ……………………………
71, 2nd Street, Section M …………………………
Fairview Park, YuenLong." …………………………….
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7. On the 16th of May the adjudicator dismissed the claimant's claim. His reasons for judgment are set out below as follows:
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"The Claimant is the Manager of the estate known as Fairview Park in the district of Yuen Long in the New Territories. The Defendant is the owner of the house known as No. 71, 2nd Street, Section M, Subsection 150 in the said estate, has been the registered owner thereof since the 21st of July 1981.
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Sometime on or about April 1985 the Claimant commenced communicating with the Defendant regarding the Claimant's allegations that the Defendant had erected fences, structures and acted in manner which the Claimant alleged to have constituted breaches of the Deed of Mutual Covenants dated the 27th February 1979 which was registered in the Land Office as memorial number 217,662. In the course of such communications the Claimant engaged the services of its solicitors Messrs EDMUND W.H. CHOW & CO. which wrote many letters to the Defendant and his solicitors regarding the removal of the alleged breaches of covenants contained in the said Deed of Mutual Covenants. After several months of correspondence the alleged breaches were removed by the Defendant although the Defendant had at all material times denied committing any breach of the said covenants. The Claimant eventually received a bill for $2,610,00 for the cost for services rendered from its solicitors. The Claimant now seeks to recover this cost of $2,610.00 from the Defendant which the Defendant had refused to pay. The claimant subsequently lodged this claim in the tribunal to claim for the said $2,610.00 plus $238.00 for expenses incurred in lodging this claim plus $300.00 collection charges. The Defendant disputed this claim and lodged a counterclaim of $5,000.00 for the legal cost which he claims to have been incurred by him in defending himself against the Claimant's allegations.
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On the date set down for hearing (i.e. the 16.05. 1986) the Defendant requested to withdraw his counterclaim After due consideration leave was granted to the Defendant to withdraw his counterclaim.
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The Claimant had previously submitted numerous documents supported by affidavits. No other evidence was submitted at the hearing. No other evidence was submitted by the Defendant other than his previous statements made on the 17th April 1986.
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The Small Claims Tribunal was set up pursuant to and by virtue of the Small Claims Tribunal Ordinance chapter 338. The jurisdiction of the tribunal is laid down in the Schedule of the said Ordinance which states:
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"Any monetary claim founded in contract, quasi-contract or tort where the amount is not more than $8,000.00 whether on balance of amount or otherwise:
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provided that..
Any claim for the recovery of any penalty, expenses, contribution or other amount which is recoverable by virtue of any enactment and for the recovery of any amount which is declared by any enactment to be recoverable as a civil debt if-...."
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The Claimant's claim is for the recovery of cost incurred as a result of negotiations by its solicitors with the Defendant and/or his solicitors for removal of alleged breaches of the said covenants. Whether the Defendant had indeed committed any breach of the said covenants as alleged by the Claimant is not an issue before the tribunal. The issue before the tribunal is a claim for reimbursement of the legal cost. incurred by the Claimant in the negotiations by the Claimant's solicitors with the Defendant and his solicitors for the removal of the alleged breaches of the said covenants. To ascertain whether such legal cost may be recoverable by the Claimant it is necessary to determine whether the Defendant has an obligation to pay for such Legal cost. It is clear that there is no contract between the Defendant and the Claimant's solicitors to the extent that any legal cost incurred would be payable by the Defendant. It is therefore necessary to examine the relationship between the Claimant and the Defendant to determine whether in the circumstances the Defendant would be liable to reimburse the Claimant for the said legal cost. The relationship between the Defendant and the Claimant is merely one that is between the owner of a property in the estate managed by the Claimant under and by virtue of the said Deed of Mutual Covenants. The said Deed of Mutual Covenants enables the Claimant (as the Manager of the said estate) to claim from all owners of property in the said estate management fees and such other fees as may be imposed under the House Rules and/or the said Deed of Mutual Covenants. The said Deed of Mutual Covenants also enables the Claimant to recover such costs and expenses as may legitimately be incurred as a result of the Claimant enforcing its rights to recover such management fees and other expenses or expenses imposed under the House Rules and/or the said Deed of Mutual Covenants. The said legal cost claimed in this claim is not cost and/or expenses incurred as a result of the Claimant enforcing its rights to recover management fees or other fees payable under the said House Rules and/or the said Deed of Mutual Covenants. The said legal cost claimed herein is cost incurred as a result of negotiations by solicitors in seeking to enforce the said covenants other than management fees or fees payable under the said House Rules and/or the said Deed of Mutual Covenants. I therefore find that such said legal cost is not related to the said Deed of Mutual Covenants to the extent that it is recoverable in this tribunal. The claim by the Claimant against the Defendant is therefore dismissed for want of jurisdiction. In view of the circumstances I make no order as to costs against any party."
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8. Section 27A of the Ordinance gives the adjudicator power of his own motion by notice on the prescribed form to all parties to review the award or order and in such review to reopen and rehear the claim wholly or in part and to hear fresh evidence and to confirm, vary or reverse his previous award or order.
9. This is the power which the adjudicator purported to exercise on 10th June 1986 when he made a number of orders. It is against these orders that the appellant now appeals.
10. The adjudicator recorded his reasons for making these orders at pages 49 to 50 of the appeal bundle as follows:-
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"The reasons for the Review at the initiation of the Adjudicator are as follows:-
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1. |
the claim by the claimant as stated in the Form II of the claim lodged in the tribunal is based upon the claimant alleging that the defendant had failed to pay the legal fees of $2,610.000 incurred by the claimant which was necessitated by the defendant having allegedly committed acts which amounted to breaches of the covenants contained in the Deed of Mutual covenants dated the 27th February 1979 registered in the Land Office as memorial number 217,662 (hereinafter referred to as the DMC) notwithstanding that the claimant had demanded payment of the legal fees from the defendant.
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at the end of the hearing of the claim, the Adjudicator found that although the defendant had acted in manner which amounted to breaches of the said covenants in the DMC, the tribunal had no jurisdiction to entertain the claim by the claimant based upon the alleged default of the defendant in not paying the said legal fees which was incurred as a direct result of the defendant and thus defaulting under the DMC as the Adjudicator found that an owner of property in Fairview Park which is managed by the claimant pursuant to the DMC was under no obligation to pay for the legal fees incurred in the enforcement of the said covenants contained in the DMC;
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under the provisions of the Small Claims Tribunal Ordinance chapter 338 the jurisdiction of the tribunal was up to the monetary limit therein provided and for matters relating to contract, quasi-contract and tort;
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the Adjudicator now feels that although the claimant may have failed to establish its cause of action in contract, there is nothing to prevent the claimant from proceeding against the defendant on a fresh claim based upon DAMAGES sustained as a direct result of the defendants actions (which is a tortious claim).
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Under the circumstances, the Adjudicator has taken upon himself to initiate this Review of the claim by setting aside the judgment previously made (on the 16th May 1986) and in the circumstances allowing the claimant to amend the claim form II instead of lodging afresh claim. The orders made are as follows:-"
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11. The adjudicator then set out the orders to which I have already referred.
12. The grounds on which the appellant appeals are that the orders are erroneous in point of law in that
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"1. |
To allow the claimant liberty to amend the Claim Form II would be a breach of the doctrine of res judicator and an abuse of the process of the Court."
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13. I see nothing in this ground because on the exercise of the Power of Review the proceedings may be reopened and reheard in whole or in part and there wrill obviously then be power to allow a claimant to amend his claim. Even his representative may do this under Section 21(iii)(e).
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"2. |
The Learned Adjudicator erred in his reasons for review in that
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(i)
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he at no stage made a finding that the defendant had acted in a mariner which amounted to breaches of the said covenants in the Deed of Mutual Covenants; stating in his reasons of judgment, 'whether the defendant had indeed committed any breach of the said covenants as alleged by the claimant is not an issue before the Tribunal';
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(ii)
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there was no evidence before him that any moneys paid by the claimant to its solicitor were paid over as a 'direct result of the defendant's action'."
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14. It seems to me that the appellant is right that there is no specific finding such as is mentioned in sub-paragraph (i) above but I cannot see that this is a ground for allowing this appeal. On the contrary a rehearing will enable the Trihunal to resolve these matters.
15. So far as sub-paragraph (ii) is concerned in view of the inquisitorial nature of the Tribunal, I do not think that this is a valid ground for allowing an appeal. All relevant matter may be pursued by further enquiry at a re-hearing.
16. The appellant also maintains that the orders were outside the jurisdiction of the Tribunal. He sets out the grounds for this contention in two paragraphs as follows:-
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"1. |
The Learned Adjudicator erred in making the order (ii) under the review dated the 10th of June 1986, in that Section 27A of the Small Claims Tribunal Ordinance Cap. 338 empowers no jurisdiction for an adjudicator to order that the Claim Form II be amended. The powers of the Learned Adjudicator on review are confined to those granted by virtue of the said section 27A.
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The Learned Adjudicator had no jurisdiction to waive service of the new claim under his order dated 10th of June 1986."
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17. I do not consider that there is anything in the jurisdiction point because once the adjudicator has decided to reopen the matter then of course he has the power to amend the Claim Form II as I have already indicated. So far as the second paragraph is concerned the proceedings are conducted in an informal manner and in my view it is within the powers of the adjudicator to waive service of the amended claims form. He is, of course bound to enquire into any matter which he may consider relevant to a claim whether or not it has been raised by a party. (Section 16(iii)).
18. Strictly speaking the adjudicator was putting the cart before the horse in setting aside his previous orders before conducting a rehearing because on review after reopening and rehearing the case he may wish to confirm, vary or reverse his previous award or order. That is the stage at which he may decide to reverse his previous order,and in effect set it aside. However, I am satisfied that what he really intended to do was reopen the matter.
19. In my view the exercise of a power of review is not an award or order in respect of which a party may appeal. An award or order may of course result from it when the tribunal determines the review.
20. Section 27A(3) provides that the exercise of the power of review shall not operate as a bar to an appeal by a party against the award or order or against the determination of the review. It is therefore regarded as something different from an award or order or a. determination of the review. The power of review is granted by statute and cannot be taken away by this Court or by any other Court.
21. It is only because the adjudicator in this case purported to set aside his previous order that this Court has jurisdiction to hear this appeal.
22. But as I have said it appears to me judging by the other orders that he made that the real intention was to exercise his power of review and reopen the matter and to determine the claim after further consideration.
23. Although there is no provision in the Ordinance for a respondent's notice, the respondent in this case has filed and served such a notice on the appellant on the 7th November 1986 setting out the contentions to be made to this Court on the day of the hearing.
24. Whether or not it is strictly in accordance with the law to file and serve such a notice, it does have the effect of giving the appellant notice of the points which will be made by the respondent at the appeal.
25. There is no need for me to deal with any of the matters in the "respondent's notice" in this case but as this matter will now go back to the Tribunal for further hearing, it may well be that the adjudicator may find the respondent's notice of some assistance in defining the issues anew and persuing the various areas of enquiry, which he would be perfectly entitled to do on a rehearing.
26. For the above reasons I allow the appeal and set aside the orders and remit this matter to the tribunal to continss with the reopening and rehearing of this matter as I am satisfied that that is what the Presiding Officer intended to do.
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(N.B. Hooper)
Judge of the High Court
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Representation:
Appellant Lee Yuen Yau in person
Miss Audrey Eu (Y.K. Fung & Co.) for Respondent
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