Wan Woo Development Co Ltd and Another v. Ma Yin Kwan and Others

Case No.CACV 200/1985

Court

Court of Appeal

Date09 May 1986

Judge—

Case Document

100%Judiciary

CACV000200/1985

IN THE COURT OF APPEAL	1985, No. 200
	(Civil)

BETWEEN

WAN WOO DEVELOPMENT COMPANY LIMITED and KEE TAI INVESTMENT COMPANY LIMITED

Applicants
(Appellants)

AND

MA YIN KWAN and others

Respondents

___________________

Coram: Sir Alan Huggins, V.-P., Cons, V.-P. & Yang, J.A

Date of Hearing: 23 April 1986

Date of Handing down Judgment: 9 MAY 1986

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REASONS FOR JUDGMENT

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Sir Alan Huggins, V.-P.:

1. We allowed this appeal and said that we would give our reasons in writing later. The short point in issue is whether there was power under s.11A of the Lands Tribunal Ordinance to review the conditions imposed by the Tribunal under s.53A(2) of the Landlord and Tenant (Consolidation) Ordinance upon the grant of an order for possession under s.53(2)(c) on the ground that the Landlord intended to rebuild the suit premises.

2. Before the order for possession could be made, the Tribunal had to be satisfied not only that the Landlord intended to rebuild but also that

"	the rebuilding will result in an increase in the number of dwellings or in accommodation for domestic use or in accommodation for other than domestic use".

Having been so satisfied, the Tribunal was bound to order that possession be given and that compensation be paid to the Tenant, and the Tribunal was empowered to impose "any reasonable condition on the landlord in relation to his intention to rebuild the premises". The order in respect of each Respondent was, substantially in these terms:

	"Upon the application of the Solicitors for the Applicant and the 1st and 2nd Respondents in person and by consent IT IS ORDERED that the following terms of settlement be recorded and made an order of the Tribunal: -
	1. Judgment be entered for the Applicant against the 1st and 2nd Respondents for:-

	(a)	vacant possession of the suit premsies known as the Front Cubicle, Second Cubicle and the Cockloft of the Ground Floor of No.221 Sai Yeung Choi Street, Kowloon; and
	(b)	mesne profits for the use and occupation of the suit premises agreed at the rate of $390.00 per month from the 1st day of January 1984 to the date of delivery of vacant possession.

	2. The Applicant undertakes not to enforce the Order far possession until the 31st day of May 1984.
	3. The Applicant shall pay the compensation of $40,000 to the 1st and 2nd Respondents upon delivery of vacant possession.
	4. The parties hereto warrant that the whole of the compensation payable in respect of the suit premises herein is not less than the statutory minimum of two times the rateable value.
	5. The 1st and 2nd Respondents undertake they have not sublet, assigned, transferred or parted with possession during the stay herein of the suit premises or any part thereof.
	6. The 1st and 2nd Respondents undertakes they shall not apply for any further stay of execution.
	7. If the 1st and 2nd Respondents fail to deliver up vacant possession of the suit premises on the 31st day of May 1984, the Applicant shall thereupon be at liberty to apply for leave to issue execution for possession and mesne profits as stated in Clause 1 hereof.
	8. The Applicant undertakes to lodge with the Tribunal the plans of the new building showing the number and size of the dwellings to be erected and that the new building be erected to provide the number of dwellings.
	9. She Applicant undertakes to commence rebuilding work of the new building upon the obtaining of vacant possession of all of the premises now existing on Nos.221, 223 and 225 Sai Yeung Choi Street and to complete the redevelopment within 36 months thereafter.
	10. There be no order as to costs."

Vacant possession was eventually given on 31st December 1984 and the landlord proceeded to demolish the old building and to start rebuilding in accordance with plans which had by then been lodged with the Tribunal.

3. Work was still being done on the foundations when the landlord decided that the plans lodged made provision on each floor above the ground floor for a type of accommodation which was no longer in demand, namely extremely small flats. Accordingly it caused to be drawn up, and approved by the Building Authority, revised plans which made provision for only half the number of flats without altering materially the total floor area of the building. Had those revised plans been the basis of the claim for possession, the Tribunal must inevitably have been satisfied that the rebuilding would result both in an increase in the number of dwellings and in the accommodation for domestic use. However, when invited to review his order, the Presiding Officer declined to do so, because it had been made by consent and he thought himself to be precluded from varying what he deemed to be a contract between the parties.

4. I did not for a moment question the principle that a true consent order could be varied only with the consent of the parties thereto, but the mere fact that the words "and by consent" were inserted in the order did not have the result that everything which followed was necessarily affected by the consent: there were some parts of the order which were within the sole discretion of the Tribunal and could not be made the subject of a binding agreement between the parties. Thus, the imposition of conditions in relation to the landlord's intention to rebuild the premises", other than a condition for the payment of compensation, was discretionary and the parties could not enforce their will upon the Tribunal. The reason for this was obvious: such conditions, if imposed, were designed to protect the public interest and were not of any particular concern to the Tenant: once the Landlord had satisfied the Tribunal of the genuineness of its intention to rebuild and that the new building would satisfy the requirements of s.53A(1), so that the Landlord became entitled to an order for possession, then - subject to the payment of the compensation - the Tenant ceased to be personally interested in what happened to the land: the plans and the dates for the commencement and completion of the building works did not affect his rights.

5. Support for this view can be found in Chandless - Chandless v Nicholson 1942 2 K.B. 321, where Lord Greene, M.R. said at p.324:

"	There is a great deal of difference between a consent order in the technical sense and an order which embodies provisions to which neither party objects".

In the present case the parts of the order which it was sought to vary were not even provisions to which the Tenant could properly object: they were within the absolute discretion of the Tribunal. Thus, to use the language of Lord Denning, M.R. in Siebe Gorman Ltd. v Pneupac Ltd. 1982 1 W.L.R. 185, those parts of the order did not "evidence a real contract between the parties": there was no agreement that the Landlord would never ask the Tribunal to exercise the power of review conferred by s.11A of the Lands Tribunal Ordinance.

6. Judge Leong thought that the Tribunal was being "made an instrument of property developers to further their business interest in the property market". He used similar words in In the matter of Nine Dragons Investment Ltd., as appears from that part of his judgment which was cited in the judgment of this court when the case came on appeal (Civ. App. 1985 No. 120). That was a case where the landlord sought authorization under s.53(7)(a) of the landlord and Tenant (Consolidation) Ordinance to assign a building which had been the subject of a similar order for possession for the purpose of rebuilding. There we thought that the Tribunal had exercised its discretion properly, but the issue with which we were here concerned was not discussed. It was true that the Tribunal here was being invited to do something which would have the effect of relieving the developer from what had turned out to be a mistaken commercial decision - a mistake resulting from an erroneous forecast of future public demand, that forecast necessarily being based in part upon past and existing demand. However, the underlying purpose of the order was to enable the developer to meet a public demand and it was in the public interest that any subsequent change in the demand should be considered.

7. I was of the view that the Tribunal did have jurisdiction to review the relevant part of its order and that this was a proper case in which we should exercise the discretion rather than remit the matter to the Tribunal. There was expert evidence to support the alteration of the plans, and an increase of four months in the time allowed for rebuilding was reasonable having regard to the delay brought about by this appeal. Care must always be exercised to ensure that the powers of the Tribunal are not abused, but I thought that, it was in the public interest that the variations sought to the conditions should be made.

Cons, V.-P.:

8. I agree.

Yang, J.A.:

9. I respectfully agree.

9 MAY 1986

Representation:

John Swaine, Q.C. & Robert Tang for Appellants

Respondents not appearing