Tsang Foo Keung and Another v. and Others

CACV 178/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 178 OF 2015

(ON APPEAL FROM HCA NO 7140 OF 1995)

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JUDGMENT

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Hon Cheung JA:

I. BACKGROUND

1.1.I agree with the judgment of Harris J that the 1^st defendant’s appeal should be dismissed.  In deference to the arguments of Mr Chan Chi Hung SC and Ms Jo Siu, counsel for the 1^st defendant, I would state the following views of my own.

1.2.The facts of this case are fully set out in the judgment of Harris J.  Very briefly the plaintiffs claimed that the 1^st defendant’s parents, Madam Yu Lai Ying and Mr Chu Kwok Chung (both now deceased) (“the Chus”) had trespassed on its land and sought possession of the land from the 1^st defendant.  It was agreed by the parties at the trial below that the relevant part of the land was the area occupied by the Chus where they had a hawker stall between the period 1963/64 and 1985.  It is not disputed that the Chus operated the hawker stall under a fixed pitch hawker licence granted by the Government.

1.3.That area is located on the steps and landing of the flight of stairs leading from Wyndham Street, Central to On Hing Terrace.  The flight of stairs is used as a public street.  The plaintiffs had granted a right of way to the owner of a building located on the other side of the stairs to use the stairs.

1.4.In the Court below the 1^st defendant’s defence is that the plaintiffs’ paper title is defeated by reason of the adverse possession by the Chus of the land (“the primary case”).  In this appeal, apart from the primary case, the 1^st defendant is also raising an alternative case that, irrespective of whether the Chus had acquired any title by adverse possession, the paper title of the plaintiffs is defeated by the adverse possession of the land by the Government through the Chus.

II. THE PRIMARY CASE

1) Requirement of factual possession and intention to possess

2.1.Factual possession and intention to possess are the twin requirements for acquiring a title by adverse possession (J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419).  It is well established that possession is tied in with the intention to possess.  As Lord Browne-Wilkinson at J A Pye (Oxford) Ltd observed at 435 that “without the requisite intention, in law there can be no possession”.  While the Chus might have long physical occupation of the land from 1963/1964 to 1985 (of which there is no controversy), Chow J held that the 1^st defendant had failed to establish either possession or intention to possess.  The Chus did not give evidence since both of them had died before the trial.  There is therefore no direct evidence of what was their intention during their long occupation of the land. 

2) Exclusive possession as best evidence of intention?

2.2.Mr Chan for the 1^st defendant argued that the best evidence of the couple’s intention to possess was demonstrated by their act of exclusive possession of the land.  In J A Pye (Oxford) Ltd Lord Browne-Wilkinson at paragraph 43, adopted the formulation of intention of Slade J in Powell v McFarlane (1979) 38 P&CR 452 at 471-472, namely, “in one’s own name and on one’s own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the processes of the law will allow”.

2.3.Lord Hope of Craighead in the same case at paragraph 71 stated:

“The only intention which has to be demonstrated is an intention to occupy and use the land as one’s own. … So I would hold that, if the evidence shows that the person was using the land in the way one would expect him to use it if he were the true owner, that is enough.”

2.4.Lord Hutton at paragraph 76 stated that when a trespasser occupied and made full use of the land in the way in which the owner would, “in the normal case he will not have to adduce additional evidence to establish that he had the intention to possess”.

2.5.Lord Hutton at paragraphs 75 to 76 stated :

“75. In the present case from August 1984 onwards the Grahams made full use of the disputed land as if they were the owners―they did everything which an owner of the land would have done and when an experienced chartered surveyor, called on behalf of the plaintiffs, was asked in cross-examination what an occupying owner of the disputed land might have done over and above what was done by the Grahams between 1984 and 1997, he was unable to think of anything.

76 I consider that such use of land by a person who is occupying it will normally make it clear that he has the requisite intention to possess and that such conduct should be viewed by a court as establishing that intention, unless the claimant with the paper title can adduce other evidence which points to a contrary conclusion.”

2.6.The situation is, however, different where there is evidence pointing to a contrary conclusion or the acts of the person who claimed possession are equivocal and capable of more than one interpretation, in such a case the intention to possess is not established.  As Slade J in Powell stated at page 472 :

“If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi and consequently as not having dispossessed the owner.”

2.7.This is reaffirmed by Lord Hutton at paragraph 76 :

“It is in cases where the acts in relation to the land of a person claiming title by adverse possession are equivocal and are open to more than one interpretation that those acts will be insufficient to establish the intention to possess.”

2.8.In my view, first, this is a case where is evidence pointing to a contrary conclusion.  This is not a case where the Chus entered the land without consultation and without obtaining permission from any one.  The Judge relied on the fact that the Chus were occupying the land by way of a licence from the Government.  I am satisfied that the Judge was correct to find that their occupation was as Government licensees pursuant to the fixed pitch hawker licence granted by the Government and not by way of “possession” for limitation purpose.  The Judge was correct to regard the following in coming to this finding :

“59. In my view, these By-laws and licence terms and conditions, subject to which Chu Senior and/or Madam Yu carried on business at D1’s Old Hawker Stall and occupied the land on which that hawker stall stood, amply demonstrate that during the period from 1963/64 to 1985:-

(1) The licences granted to them were ‘fixed pitch’ hawker licences which spelt out the specific location and the precise dimensions of their allocated pitch. It is not merely a licence permitting them to carry out certain activities.

(2) Chu Senior and Madam Yu were at all material times subject to the power of the licensing authority to allocate a specific pitch to them as well as the power to require them to vacate from their allocated pitch.

(3) The purpose and the duration of Chu Senior and Madam Yu’s occupation of their allocated pitch, as well as the activities which they were permitted to carry out at their allocated pitch, were subject to close control and regulation by the licensing authority.

(4) Chu Senior and Madam Yu were also subject to stringent restrictions as to how their allocated pitch could be occupied and used.”

2.9.Further, in the light of these factors, the nature of the occupation by the Chus was at best equivocal and open to more than one interpretation.  This being the case the statements of Slade J and Lord Hutton come into play and the Court will treat the Chus as not having had the requisite intention and consequently as not having dispossessed the plaintiffs.

3) Implied licence by the owner to the Government

2.10.The Judge in paragraph 61 of the judgment held the fact that the Government was not the owner of the land in question would not affect the conclusion that the Chus did not have “possession” of the land for limitation purposes.  He then referred to the judgment of Keith J (as he then was) in Wu Chee Ling v Urban Council [1996] 1 HKLR 282 to address the issue on how the Government, not being the land owner, could or would grant a licence to the Chus to occupy private land for the purpose of hawking.  That case deals with the judicial review by Wu Chee Ling (who is the 2^nd and 3^rd defendants in this case) against the decision of the Government to revoke a fixed pitch hawker licence granted to her on another piece of land in On Hing Terrance which also belongs to the plaintiffs. 

2.11.Keith J at page 286 referred to the Government’s long-standing practice to require fixed pitch licence holders to vacate their pitch if the pitch is on private land, and the owner of the land no longer consents to the presence of the pitch on the land.  He observed on the same page :

“… The [Urban] Council’s long-standing practice is an entirely rational and sensible one. Hawkers can only trade on private land if they have the consent of the owners of the land to be there. Otherwise, their presence on the land would constitute trespass. For that reason, the Council cannot sanction the presence of hawkers on private land without the consent of the owners of the land. It could not, for example, issue a fixed pitch hawker licence to a hawker who proposed to trade from private land without the owner's consent.”

2.12.Mr Chan referred to this as the implied licence granted by the owner to the Government.  He argued that such a theory is untenable.  This is because under private law if a person having no right in the land at all grants a license to another to occupy it, the owner can sue both the licensor and licensee for damages for trespass for the period prior to the communication of the owner’s objection to the licence, in addition to suing both for damages for the period thereafter, and for recovery of the land.  He criticized the Judge’s approach at paragraph 61 and his reliance on Wu Chee Ling because such an approach would have meant that any owner in Hong Kong cannot sue the unauthorized licensor and licensee of his land for the period before the owner’s objection is made known to the licensor, even if, for example, the owner during that period did not know of the licence or trespass.  He argued that this is clearly contrary to the established authorities and the reasoning of Keith J and the arguments of counsel in Wu Chee Ling were all rather in the context of public law considerations only.  

2.13.He then argued that there is nothing in the hawking legislation which takes away a private law right of a landowner without compensation.  On the basis that the implied licence argument is untenable, he argued that construing the hawking legislation and the hawker licence by the Government as infringing a private law right of the owner (by the Government granting a licence when the Government has no right to occupy the land), or the Government as having the intention to grant a licence to occupy land, thus putting itself under a liability for trespass, is not supportable. 

2.14.He then analysed the provision of the hawking legislation and the hawker licensing scheme and argued that the hawker licence was merely a permit to conduct an activity (hawking) which was otherwise generally prohibited by the general scheme of administrative regulation of hawking activities, not a licence to occupy certain land.  Thus its nature is negative and permissive, not prescriptive.  The sole purpose of the hawking legislation is to enable the Government to regulate hawking activity.

2.15.In my view whether the implied licence theory is tenable or not is not determinative of the issue before us, namely, whether the Chus had the intention to possess the land as their own during the period of the hawker licence.  Irrespective of whether the Government had any permission or implied licence from the plaintiffs, the reality is that it was only through the Government and no body else that the Chus were allowed to occupy and hawk on the land.  While I have no doubt that the hawking legislation contains provisions for the regulation of hawking activities, at the same time one just cannot brush aside the fact that the Chus only came to occupy the land as a result of the hawker licence being granted to them.  In such a situation, it would be extremely farfetched to argue that, with the existence of the hawker licence, the Chus had from that moment onwards carried with them the intention that they were occupying the land on which their hawker stall was located as their own to the exclusion of the true owner of the land.  Such an intention was incompatible with the permission granted by the Government to them by the hawker licence.

III. THE ALTERNATIVE CASE

3.1.In support of the alternative case by the 1^st defendant that the paper title of the plaintiffs is, in any event, defeated by the adverse possession of the Government, Mr Chan relied on Sze To Chun Keung v Kung Kwok Wai David and another [1997] 1 WLR 1232.  The headnote states that the plaintiffs were the registered owners of land held under a Crown lease.  The defendant went into occupation of the land in about 1955.  In 1961 he was granted a Crown land permit which expressly stated that it was not to be construed as a tenancy, entitling him, on payment of a fee, to occupy the land and to erect buildings.  The plaintiffs were unaware of the permit, which was cancelled in 1988, when the Crown discovered that the land was in private ownership.  No communication took place between the Crown and the plaintiffs.  The defendant continued to occupy the land, and in 1990 the plaintiffs brought an action to recover possession from him.  In his original defence he pleaded that he was entitled to retain possession by virtue of the Crown permit which he had held.  The plaintiffs applied to strike out the defence on the ground that it disclosed no reasonable defence.  The master dismissed the application and the plaintiffs appealed.  The defendant applied for leave to amend the defence to substitute a defence under the Limitation Ordinance.  The judge considered that the proposed defence was bound to fail, and so she dismissed the application for leave to amend, struck out the defence and entered judgment for the plaintiffs.  The Court of Appeal upheld that decision.  The Judicial Committee of the Privy Council, hearing the last appeal from Hong Kong before the change of sovereignty in 1997, allowed the defendant’s appeal.

3.2.The Judicial Committee first held that the defendant’s possession of the land was on behalf of the Crown. Lord Hoffmann at page 1235 held :

“After the grant of the Crown permit, the defendant remained in physical possession of the land. It was wholly enclosed and the defendant manifested the outward intention of excluding all other persons, including the owner and the Crown, which had granted him a right of exclusive occupation. So far as third parties, including the plaintiffs, were concerned, he was in possession: see Ho Hang-wan v. Ma Ting-cheung [1990] H.K.L.R. 649. But the effect of the permit was that he possessed on behalf of the Crown. By accepting the benefit of the permit, he became estopped from denying that the Crown had the right to allow him to occupy.

For the purpose of limitation, therefore, possession from 1961 must be regarded as having been in the Crown, which possessed through its licensee, the defendant.”

3.3.Lord Hoffmann then addressed the question whether that possession was adverse to the plaintiffs.  He held at page 1235 that it was :

“Their Lordships consider that it was. The position of the Crown was no different from that of any other person who had taken possession by a licensee. The situation would have been no different if, for example, the defendant had sold his possessory title to a company which allowed him to remain in occupation and run the store as its manager.”

3.4.At page 1236, he held that :

“It therefore appears to their Lordships that, on the facts as pleaded, the land has been continuously in adverse possession since 1955 and that the plaintiffs’ title was extinguished in about 1975. To all outward appearances, there was no change in possession throughout the period and the licensing arrangements between the defendant and a third party, the Crown, did not affect the adverse nature of the possession as against the plaintiffs. At the time when proceedings were commenced, the defendant had been in possession on his own account for only two years. But this does not matter: the Limitation Ordinance is not concerned with whether the defendant has acquired a title but with whether the plaintiffs’ right of action has been barred. For this purpose, all that matters is that there should have been continuous adverse possession for the period of limitation. The rights inter se of the successive persons who may have been in possession adversely to the plaintiffs since they were dispossessed are for this purpose irrelevant. Thus the proposed defence disclosed an arguable ground of defence and the defendant should have been granted leave to amend his defence.” (emphasis added)

3.5.The alternative case was not pleaded by the 1^st defendant nor advanced in the Court below. The difficulty with the 1^st defendant’s alternative case is that he assumed that the long occupation by the Government must necessarily be in the nature of an adverse possession.  This is clearly a factual issue.  In my view the present case is different from Sze To Chun Keung.  When the Judicial Committee discussed the adverse possession by the Crown, it was addressing it in the context of whether the proposed amendment disclosed an arguable defence.  The long-standing practice of the Government about recognizing the rights of private land owners, cited by Keith J in Wu Chee Ling, at the very least, refuted any intention by the Government to dispossess the paper title owner.  In addition there was correspondence in this case between the Government and the parties which had not been examined by the Judge which may also refute any such an intention.

3.6.In my view the alternative case is not merely based on legal arguments.  Had this case been pleaded and argued, the Government was clearly entitled to adduce evidence on its intention in granting hawker licence on private land and the nature of its occupation of such land whether by itself or through its licensee.  Without such evidence the Court is not in a position to decide whether there is adverse possession in such circumstances.  Accordingly the 1^st defendant is not entitled to raise the alternative case in this appeal when evidence had already been called and addressed in the Court below.

IV. CONCLUSION

4.Accordingly the appeal is dismissed with costs to the plaintiffs (together with a certificate for two counsel) and the 2^nd and 3^rd defendants.

Hon Yuen JA:

5.I agree with Cheung JA and Harris J that this appeal should be dismissed.  In my view, the crux of this appeal lies in the failure by the 1^st defendant (whose burden it was) to prove that his parents had the requisite intention for adverse possession during the relevant time (1963 to 1985) ie the intention to occupy as “if they were the true owners”.  The only evidence of their intention was that they occupied the subject area only to ply their trade because the hawker licence gave them exemption from prosecution.  That was the effect of the Judge’s finding at para 53 of the Judgment.  The 1^st defendant adduced no satisfactory evidence from which it could be inferred that his parents would have persisted in occupying the subject area for the requisite period (a) to hawk even if they had no licence to hawk from there (and hence risk prosecution), or (b) if not to hawk, as they had some other (unknown) use for the area.  The judge was entitled on the evidence before him to find that the 1^st defendant had failed to prove that his parents had the requisite intention to occupy the subject area as “if they were the true owners”.  In my view, that was enough to dispose of the first argument.

6.Mr Chan’s alternative argument (first raised on appeal) is that even if the Chus personally had not acquired any title by adverse possession, the plaintiffs’ paper title was defeated by adverse possession by the Government through its licensees the Chus.  It seems to me that this is inconsistent with his case as it was pleaded in para 15A of the 1^st defendant’s Re-Re-Amended Defence and Counterclaim that:

“Further, it is denied that the occupation of the 1^st Defendant and/or his agent … was on behalf of the Government as its licencee, whether express or implied, by virtue of the Licence or any fixed pitch stall licence, as alleged or at all.”

7.In any event, I agree with Cheung JA that this alternative argument could not be run on appeal on the Flywin principle (Flywin Co Ltd v Strong & Associates Ltd (2002) 5 HKCFAR 356) because of the likelihood of further relevant evidence from the Government on its intention when granting fixed pitch hawker licences on privately owned land in urban areas. 

8.In this respect, I would only mention that I am inclined toward the view that a licence (granted by an authority responsible for public health and municipal services) to hawk from a site should be distinguished from a licence (granted by an owner or other person entitled to possession) to occupy the land.  The former gives the licence holder an exemption from prosecution if he hawks from the confines of the specified site.  That is not to be confused with a licence (in the proprietary sense) to occupy private land.  There was no evidence of any mistake on the part of Government as to who owned the subject area, or of its intention (mistaken or otherwise) to possess the subject area as if it were the true owner. 

9.Indeed the only evidence of Government’s policy was one of deference to the land owner, as shown in the correspondence following the plaintiffs’ objection and Government’s relocation of the hawker site thereafter.  That is evidence that the Government had no intention to possess the land, through the licensed hawkers, as if it was the true owner. 

10.In summary, my view is that whether or not there was an implied licence from the plaintiffs’ predecessors to the parents to occupy the subject area, and whatever the reason for the land owner suffering the hawker stall to be there from 1963 to 1985, there was no evidence that the parents had the necessary intention to possess the area as if they were the true owners, because the only evidence of their intention was only to hawk pursuant to the hawker licence granted by the Government.  That hawker licence only enabled the hawker to trade without risk of prosecution, and there was no evidence that the Government intended to possess the subject area as if it were the owner by occupying it through the hawkers.

Hon Harris J:

Introduction

11.This is an appeal by the 1^st defendant in HCA 7140/1995 (“Action”) from the judgment of Chow J (“Judgment”) in favour of the plaintiff and ordering that the 1^st defendant deliver up vacant possession of a small area of land he and his Parents had occupied whilst carrying on business as a hawker on a flight of steps at the western end of On Hing Terrace where it joins Wyndham Street in Central, of which he alleged his Parents acquired title by adverse possession.  I shall refer to this area as the “disputed area”. The disputed area forms part of Subsection 1 of section H of Inland Lot No 617 and Subsection 2 of Section H of Inland Lot No 617.  I shall refer to these 2 areas as the “Land”.  The Land consists of a building known as Ivy House, nos 18-20 Wyndham Street and two flights of steps, which are divided by a landing and which form the western entrance to On Hing Terrace.  Annex B to the Judgment contains a sketch showing the relevant areas.  It is reproduced as Appendix A to this judgment.

12.It is the 1^st defendant’s case that from about 1963/64 to 1985, his Parents operated in the disputed area a hawker stall carrying on business mending and knitting clothes.  The precise area that the 1^st defendant says was occupied was marked on a sketch (Annex B) appended to his Re‑re‑amended Defence and Counterclaim dated 11 September 2014.  He claimed that by 1985 his Parents had acquired possessory title to the area shown on the sketch.  Chu Senior died in 1986 and his wife, Madam Yu, died on 9 June 1995.  The Judge rejected this argument on the grounds that the Parents were operating their business on the disputed area by virtue of the periodic hawker licences granted to them during the relevant period and were not in possession in their own right.  It is that decision that the 1^st defendant challenges in this appeal.

13.The 2^nd and 3^rd defendants settled their dispute with the plaintiff over their own claim to title by adverse possession for part of the Land, some of which formed part of the disputed area, in HCA 916/2012 which was originally to be tried together with the Action, immediately prior to the commencement of the trial.  As the result of the appeal potentially impacted on their agreement with the plaintiff, the 2^nd and 3^rd defendants attended the appeal and made submissions, which were consistent with those of the plaintiff.

14.Chow J sets out the background to the dispute very thoroughly in his judgment.  It is only necessary for me to summarise it for the purposes of the Appeal.

Background

15.Ivy House was constructed in the early 1960s.  During its construction the steps that lead from Wyndham Street to On Hing Terrace were rebuilt.  They became 2 flights of steps separated by a landing (“Steps”) as can be seen from the sketch in Appendix A.  The lower flight consisted of 14 treads of which the bottom 4 treads are incomplete.  The precise date the steps were finished is unclear, but it is not in dispute that it was completed during or prior to 1964.

16.Further redevelopment took place in Wyndham Street immediately north of On Hing Terrace, which resulted in the construction of Wong Chung Ming Commercial House at nos 14-16 Wyndham Street.  This was completed by the end of 1985.  Further road widening work took place in Wyndham Street in front of Ivy House and Wong Chung Ming Commercial House.  This was completed by late 1987 and since then there have been no further changes to the Land or its vicinity.

17.Chu Senior first obtained a hawker licence in 1947 to operate as a clothes mender on a fixed pitch at the end of On Hing Terrace abutting Wyndham Street.  A similar licence was granted dated 2 April 1964.  After Chu Senior’s death a similar licence was granted to Madam Yu dated 13 November 1987.  On 2 December 1988 a “Fixed Pitch (Other Classes) Hawker Licence” was granted to Madam Yu for the same pitch, but for the sale of dry goods.

18.As a result of the redevelopment of nos 18-20 Wyndham Street, Chu Senior’s hawker stall was moved from the side abutting nos 18-20 to that abutting 14-16.  It was the 1^st defendant’s evidence that he recalled this taking place before the completion of the Steps.

19.There is a dispute about the precise position and size of Chu Senior’s hawker stall, but it is common ground that it remained in the same location between 1964 and the completion in 1985 of Wong Chung Ming Commercial House (“D1’s old hawker stall”).  The 1^st defendant says that his Parents allowed the 2^nd defendant to use part of their space to operate a flower stall.

20.In 1985 Chu Senior’s hawker stall was relocated higher up the steps.  It is the 1^st defendant’s case that by this time possessory title to the disputed area had already been acquired and the shared possession of it for certain periods by the 2^nd defendant could not affect the acquisition of title.

21.On 30 August 1995 Madam Yu’s licence was cancelled following her death in June of that year.  Another family member, Chu Kwok Chung, obtained a hawker licence to operate in On Hing Terrace on 30 October 2000.  His wife succeeded to his licence following his death on 25 March 2008, but the licence provided that from about 11 May 2009 the stall be operated in Li Yuen Street West, which runs north from 57 Queen’s Road, Central.  As the Judge in my view correctly notes in paragraph 37 of his Judgment, the 1^st defendant’s case is based only on occupation of D1’s old hawker stall prior to 1985.

Basic Principles

22.Before explaining the Judge’s reasons for rejecting the 1^st defendant’s case it will be helpful to summarise the basic principles of adverse possession:

(1) If the law is to attribute possession of land to a person who can establish no paper title to it, he must be shown to have had both factual possession during the relevant period (in the present case 20 years as the alleged possession occurred prior to 1991) and the requisite intention to possess^[1].

(2) What constitutes a sufficient degree of exclusive physical control depends on the circumstances of the case and, in particular, the nature of the land and the manner in which land of that nature is commonly enjoyed.  What must be shown is that the alleged possessor has been dealing with the land as an occupying owner might expect to deal with it^[2].

(3) The requisite intention is to exclude the world at large, including the owner, from the land so far as is reasonably practicable and so far as the law allows^[3].

(4) The person claiming adverse possession has the burden of proving both exclusive physical control and the requisite intention.  Although the standard of proof is still the normal civil standard, ie on the balance of probabilities, commensurate with the serious consequences of finding that the holder of the paper title has been disposed the evidence of exclusive possession and intention must be compelling^[4]. It cannot be lightly assumed that the paper title holder has foregone his interest in land.

(5) Evidence of subjective intent should be approached with caution.  Intention is normally better assessed by inference drawn from the acts of the possessor in the light of nature of the land and its use^[5].

(6) If a person takes possession by virtue of a licence granted by another, it is the licensor who is treated as being in possession^[6].

The Judge’s decision

23.In short the Judge rejected the 1st defendant’s claim because he concluded:

(1) The 1^st defendant’s Parents occupied the disputed area pursuant to the fixed pitch hawker licences, there being no evidence to suggest any other basis for their occupation: §§52-53.

(2) Although the licences for the entire period from 1963/4 to 1985 were not available, from those that were available for both that period and the licence granted to Madam Yu in 1993, it could be seen that the terms of the licences contained a number of restrictions on occupation and use of the disputed area: §58-59.

(3) The licences were for fixed terms of 12 months.

(4) The licences specified that the licensee could be required to vacate a pitch at any time.

(5) The licences prohibited transfer, assignment or sub-letting or otherwise parting with occupation.

(6) The licences specified the trade that could be carried on by the licensee.

(7) The licences specified the precise area on which the trade could be carried out.

(8) The Judge concluded that in the light of these matters the Parents occupied the disputed area as Government licensees and that their occupation could not be considered possession for limitation purposes: §60.

(9) So far as intention is concerned, the Parents were not, of course, available to give evidence and the 1^st defendant was unable to give any evidence of value concerning his Parents’ intention.  Looking at the matter objectively the most realistic conclusion to draw was that the Parents did not intend to occupy and use the disputed area as their own and so as to exclude the world at large and the paper title holder: §64.

(10) It followed that the Judge dismissed the 1^st defendant’s defence and counterclaim and made an order that the disputed area be vacated. 

24.The Judge dealt with a number of matters, which in the light of the way in which the appeal is framed and the decision I have reached it is not necessary to address.

Grounds of Appeal

25.The 1^st defendant challenges the Judge’s findings on the following grounds in his Notice of Appeal and his more extensive Supplementary Notice of Appeal:

(1) The Judge was wrong to find that the Parents were in possession of the disputed area not in their own right, but as licensees of the Government and for a limited purpose: grounds 1 and 2.

(2) The hawker licencing system should not be viewed as authorising occupation of land that the Government had no right to occupy.  The licences were merely permits to carry out a trade at a particular place rather than a licence to occupy: grounds 3, 5-14.

(3) The Judge was not aware that the bye-laws and terms of hawker licences changed between 1963/4 and 1972 in particular the obligation to vacate on notice was not in the pre-1972 terms: ground 4.

(4) If the Parents were occupying pursuant to the fixed pitch hawker licence, the Judge erred in deciding that a licensee of the Government cannot establish adverse possession: ground 15.

26.In short, what the 1^st defendant argues is that the licences are irrelevant to the consideration of whether the necessary possession and intention to possess has been shown.  This amounts to inviting the Court to approach the matter on the basis that licences had not been granted.  This seems to me to be entirely, and self-evidently, artificial.  Regardless of whether or not one views the occupation as being pursuant to the licences or incidental to them, the fact remains that the Parents were occupying the disputed area because they had been granted fixed pitched hawker licences, which allowed them lawfully to carry on the specified trade in the specific location, and this necessarily informs how one views what the Parents were doing and what their intention was.

27.The most obvious flaw in the 1^st defendant’s argument concerns intention.  The Judge found that there was no evidence of the Parent’s intention in occupying the areas designated by the fixed pitch licences.  This finding is not challenged.  Therefore, all that the Judge could do is draw inferences.  It seems to me that his conclusion in paragraph 64 that the Parents probably did not intend to treat the land which they occupied as their own and exclude the paper title owner is almost certainly correct and no basis has been advanced by the 1^st defendant for interfering with this decision.  This is of itself sufficient to dispose of the Appeal.

28.So far as possession is concerned it seems to me to make no difference at all whether one views the licences as authorising occupation of an area specified in the licence to carry out a particular trade or alternatively authorising the carrying out in the specified area of a particular trade on the unstated, but necessary, assumption that occupation of the area will not be objected to by the paper title holder.  As I have already explained^[7] in assessing whether a sufficient degree of exclusive control has been shown, regard must be had to the circumstances of the case and, in particular, the nature of the land and the manner in which land of that nature is commonly enjoyed.  What must be shown is that the alleged possessor has been dealing with the particular parcel of land under consideration as an occupying owner might expect to deal with it.

29.The Parents’ occupation was of a flight of steps running from a road (Wyndham Street) to On Hing Terrace, which is a pedestrian thoroughfare.  They had erected a wooden structure on it from which they carried on business.  Similar structures can be seen in various areas in Central in which hawkers traditionally carry on business from fixed pitches. At night these structures are closed and locked.  They commonly look like very large, free standing green cupboards.  The structures may remain in place for long periods, as was the case with D1’s old hawker stall, and their use and occupation go unchallenged, but it seems to me that it is artificial to suggest that the hawkers are dealing with the land as an occupying owner might.  They are clearly temporary, wooden structures erected in public areas by hawkers.  Put simply the Parents were using a small area of steps in a way one would expect a licenced hawker to use it not as an owner of an adjacent property to which the area provided access would be likely to use it.  I doubt if it would cross the minds of many passers-by that the hawkers owned the land from which they carried on their trade.

30.In my view it does not matter that the Judge approached the issue of possession on the basis that the Parents occupied the disputed area as a Government licensee: §60.  However, I consider that the correct analysis of the effect of the licences is as follows.  The fixed pitch hawker licences authorised the licensee to carry out the approved trade from a designated location.  The right to do so was always subject to objection from the owner of land, who could require the hawker to vacate the designated area and certainly by 1972 the licences contained a provision expressly dealing with this eventuality.  I think it reasonable to assume that in practice the Urban Council, who issued the licences at the time, only did so for locations on private land if they understood the owner had no objection.

31.vIt follows in my view that the final ground of appeal is irrelevant, namely, that if the Parents occupied the disputed area as Government licensees the Judge’s finding that this prevented the 1^st defendant establishing adverse possession was inconsistent with the Privy Council’s decision in Sze To Chun Keung v Kung Kwok Wai David ^[8].

Conclusion

32.I would dismiss the appeal and make a costs order that the 1^st defendant pay the plaintiff and the 2^nd and 3^rd defendants costs of the Appeal with a certificate for two counsel.

Mr Chan Chi Hung SC and Ms Jo Siu, instructed by Hau, Lau, Li & Yeung, for the 1^st defendant

Mr Wong Yan Lung SC and Mr James Lee, instructed by Cheung & Yeung, for the plaintiffs

Mr Paul Wong, instructed by Hon & Co, for the 2^nd and 3^rd defendants

Appendix A