The Incorporated Owners of Duke Garden v. Free Point Technology Ltd

DCCJ 3923/2016

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 3923 OF 2016

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DECISION

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1.This is the plaintiff’s application for summary judgment under Order 14 of the Rules of the District Court (“RDC”) against the defendant to vacate a car parking space at the common area located in a development known as Duke Garden situated at No 2 Duke Street, Kowloon, Hong Kong (“the Building”).

BACKGROUND

2.The plaintiff is the incorporated owners of the Building where 19 parking spaces were allegedly licensed out by it to the owners/occupiers of the Building.  The defendant who is owner of one of the units of the Building has been allocated parking space R18 (“R18”).

3.Complaints had been made against the defendant by other owners/occupiers regarding the manner in which the defendant’s vehicle was parked at the said parking space.  The plaintiff says that despite repeated requests and demands made by the plaintiff to rectify the same, the defendant refused to do so. 

4.The plaintiff allegedly revoked the licence for the defendant to use the parking space.  The plaintiff claims that the licence is revocable at will.  Alternatively, the plaintiff says that the licence comes with certain implied conditions, including not causing obstruction or interfering with other owners’ enjoyment.  The plaintiff alleges that the defendant had been in breach of such implied conditions which entitled it to revoke the licence.

5.The defendant’s case as revealed in its sole director Madam Choi Yuen Chu’s affirmation (“Choi’s Affirmation”) filed for the purpose of opposing the plaintiff’s application is that: (1) the defendant had the right to use the parking space; (2) there was no implied conditions to the licence alleged by the plaintiff; (3) the defendant infringements were caused by the erection of some traffic pillars at parking space R19 (“R19”) which was next to R18; (4) other users of the parking space committed similar infringements; and (5) the plaintiff did not come with clean hands in these proceedings.

Applicable legal principles

6.The laws governing summary judgment under Order 14 of the RDC are trite and need no repetition. However, I think some of the principles stated by the defendant’s solicitor in her submission are worth highlighting.

7.Order 14, rules 3(1) of the RDC provides as follows:-

“Unless on the hearing of an application under rule 1 either the Court dismisses the application or the defendant satisfies the Court with respect to the claim, or the part of a claim, to which the application relates that there is an issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial of that claim or part, the Court may give such judgment for the plaintiff against that defendant on that claim or part as may be just having regard to the nature of the remedy or relief claim” [emphasis added]

8.Para 14/4/9 of the Hong Kong Civil Procedure 2017 (“HKCP”) states that:-

“Unless it is obvious that the defence put forward by the defendant is “frivolous and practically moonshine, O.14 ought not to be applied: Codd v Delap (1905) 92 LT 510 at p 511, per Lord Lindley.” [emphasis added]

9.Para 14/4/9 of HKCP further states that:-

“...... Order 14 is for clear cases, that is, cases in which there is no serious material factual dispute and, if a legal issue, then no more than a crisp legal question as well decided summarily as otherwise ...... The procedure is entirely inappropriate where the plaintiff’s entitlement to recover any sum is the subject of any serious dispute, whether of law or fact. This is not to say ...... that a defendant with no or more than a partial defence can cheat a plaintiff of his just desserts by producing hefty affidavits and voluminous exhibits to create an illusion of complexity where none exists. Where the point at issue is at heart a short one the court will recognize the fact and act accordingly no matter how bulky its outer garments. But it does mean that where there are substantial issues of genuine complexity the parties should prepare for trial ...... rather than dissipate their energy and resources on deceptively attractive short-cuts.” (emphasis added): Crown House Engineering v Amec Projects Ltd (1990) 6 Const LJ 141, at 154, per Bingham LJ.”

10.Hence, the court should be very slow in allowing the plaintiff to obtain judgment without trial or in making payment into court a condition of leave to defend:-

“I would sound a note of caution ...... to justify the plaintiff in asking the court to embark on a mini-trial of the action on affidavit evidence.  That is not a proper course for the court to take.  It will in future be sufficient for the court to ask itself the simple question: “Is what the defendant says credible?”  If so, he must have leave to defend.  If not, the plaintiff is entitled to summary judgment.  The issue is, not whether the defendant’s assertions are to be believed; it is whether those assertions are believable.”  See Ng Shou Chun v Hung Chun San , CACV 182/1993, 26 January 1994, at para 16, per Godfrey JA.

11.Thus, the principles applicable to summary judgment applications are well settled.  In short, the defendant must satisfy the court that he has a fair or reasonable probability of showing a real or bona fide defence.  On the other hand, summary judgment under Order 14 should not be granted when any serious conflict as to matter of fact or any real difficulty as to matter of law arises.  The court must not embark on a mini trial on affidavits: see Belvedere Limited v The Incorporated Owners of Dak Shing Building, unreported, DCCJ 3893/2013, 13 January 2015, at para 9.

12.Lastly, it is worth bearing in mind the following passage in Top Base Development v Lloyd Laurence Philip, unreported, CACV 286/2007, 23 July 2008, whereHon Yuen JA stated that Order 14  applications are not suitable in a case where mandatory injunction is sought:-

“It is important to bear in mind that this is an application for a mandatory injunction by way of a summary judgment application. In my view, even if the 4^th Plaintiff successfully proved a proprietary right, it would not necessarily follow that a mandatory injunction would be granted at this stage ...... a mandatory injunction is an equitable remedy and matters such as acquiescence or hardship are fact-sensitive and may have a bearing on whether an injunction or other relief should be granted.” [emphasis added]

The plaintiff’s application

13.By its summons dated 14 September 2016, the plaintiff is seeking (i) an order for the defendant to vacate R18 at the Building; and (ii) an injunction against the defendant and/or its tenants, agents or representatives to use R18. 

14.There are also the requests for ancillary reliefs for mesne profits from 1 August 2016 until delivery of vacant possession of the parking space and for interest and costs.

The plaintiff’s case

15.The plaintiff says that there are no triable issues in this case and that it is entitled to summary judgment based on the reasons set out in its chairman Chan Chi Shing’s affidavit (“Chan’s Aff”) and supplemental affidavit (“Chan’s Supp Aff).

16.In short, the plaintiff’s case is that:-

(a)  R18 was subjected to a contractual licence granted by the plaintiff and of which the plaintiff can revoke at will;

(b)  There was no right to use the parking space and it did not come with the interest in the property owned by the defendant;

(c)  The licence comes with “implied conditions” parallel to those which can be found under the Deed of Mutual Covenant (“the DMC”) of the Building which prohibits acts like nuisance, damage or inconvenience to the occupiers of any neighbouring premises; causing danger nuisance or annoyance to the occupiers of the Building; and not to place anything in or occupy any common part: see clauses 6(c), 6(e) and 6(f) of the DMC; and

(d)  Once reasonable notice is given, the plaintiff is entitled to evict the defendant of R18.

DISCUSSION

Whether there are any triable issues?

17.In my judgment, there are at least a few triable issues in this case which warrants the case to go to trial.

18.First, in my view, it is by no means clear whether the parking space was subjected to the terms of a licence at will or a contractual licence or tenancy.

19.The plaintiff’s case that it is a licence at will is only based on the bare assertion of the chairman contained in Chan’s Aff.  In it, Chan asserts that in a general meeting in or about 1973, it had been resolved that the plaintiff was empowered with full discretion to grant licenses for the parking spaces in the Building which will be “exclusive, unwritten and at will”.  However, such allegation was not supported by any minutes or contemporaneous documents.  If this is indeed true, I would expect at least some documents would have at least mentioned such licensing arrangements over the years.  Yet there was none produced by the plaintiff to support its case. 

20.On the other hand, the defendant’s claim that it was a contractual tenancy or contractual licence is in part supported by the monthly payment record of the occupants of the Building.  Further, in my view, it is certainly arguable to say that the arrangements between the parties are more akin to that of a tenancy than a licence in that: (i) there was exclusive possession; (ii) there was defined premises; and (iii) there was fixed or periodical term of payment: see for example Street v Mounford [1985] 2 ALL ER 289.

21.Second, given the fact that Choi had been parking her car at R18 for over 20 years without receiving any complaint prior to the current episode, it is certainly arguable whether it was her ways of parking her newly acquired SUV or it was the traffic pillars erected by the occupier of R19 which had caused Choi to park her car in such a manner as to protruding onto the common area. 

22.While the plaintiff was able to produce photos showing Choi had repeatedly parked outside her designated area at R18, thus causing obstruction and inconvenience to other owners / occupiers of the Building including user of R19, there are also photographs produced by the defendant showing both the occupier of R19 and other occupiers of other parking spaces had parked or protruded outside their parking spaces. 

23.Third, in my view, it is certainly arguable whether one can say that the plaintiff can draw an analysis between the alleged breaches of a licence at will as an “implied conditions” with that of breaches of the provisions under the DMC.  To me, they are very different things and carry very different legal consequences.  Thus, the defendant’s case, insofar as it relies on the alleged breaches of the DMC, is at least debatable.

24.Fourth, even if the defendant had been in breach of the DMC or had caused the alleged protrusion of her vehicle, there is still a question of whether the plaintiff has acquiesced or waived the defendant’s breaches over the years.

25.Last but not the least, I am fully conscious of the fact that if the plaintiff succeeds in the present application, this will effectively mean granting a permanent mandatory injunction in its favour and depriving the defendant of any defence based on acquiescence, hardship or any other equitable grounds, something which the law says the court should be slow to do: see Top Base Development Limited v Lloyd Laurence Philip, supra.

CONCLUSION

26.Based on the aforesaid, I am of the view that there exist triable issues and that the defendant has demonstrated real and bona fide defence in this case.  I therefore dismiss the plaintiff’s summons and give the defendant unconditional leave to defend the matter.  I order that the defendant do file and serve a defence within 28 days from the date of this Order and the plaintiff to file and serve a reply within 14 days thereafter.

27.As is usual in such cases, the costs will be in the cause.

Mr Cheng Shui Tai, of ST Cheng & Co, for the plaintiff

Miss Lee Hoi Wai, of Huen & Partners, for the defendant