Li Tang Shi v. Li Wai Kwong and Another

CACV000027B/1969

IN THE SUPREME COURT OF HONG KONG

APPELLATE JURISDICTION

CIVIL APPEAL NO. 27 OF 1969

-----------------

-----------------

Coram: Rigby, S.P.J., Scholes, J. and Mills-Owens, J.

Date of Judgment: 13 December 1969

-----------------

JUDGMENT

-----------------

1. At the date of his death in 1908 the deceased, Li Wah Fuk, was registered under the land registration system prevailing in the N.T. as the owner of certain properties there situated. It is common ground that he died leaving the plaintiff appellant his lawful widow, but without issue. The first respondent, the first defendant in the proceedings, is the nearest male relative of the deceased, being a descendant in the male line of the deceased's paternal grandfather.

2. In 1912 a document was registered against the relevant titles purporting to record the appointment under section 15 of the N.T. Ordinance (Cap. 97) of three managers of the "Li Wah Fuk Tso", the appellant being one of such managers. The two other managers subsequently died, leaving the appellant as sole manager.

3. At a later date the first respondent was appointed an additional manager, jointly with the appellant. Subsequently the appellant was removed from her position as a joint manager, purportedly under section 15 of Cap. 97, thus leaving the first respondent as the sole registered manager. As the learned trial judge held, the appointment of the first respondent as a joint manager was wrongly made by the officials of the Land Office; and so also was the removal of the appellant, without her being given a hearing, held to be wrong as being contrary to natural justice. On the appeal the first respondent has appeared but entered no cross-appeal against those decisions.

4. The A.G. was made a second defendant, apparently because of the allegations of wrong-doing (in the technical sense) on the part of the officials of the Land Office, namely their alleged wrongful appointment of the first respondent as a joint manager followed by their alleged wrongful removal of the appellant.

5. The case of the first respondent was that the properties derived from an ancestor of the deceased and formed part of a Tso which had been created by that ancestor; he, the first respondent, as he contended, was a descendant in the male line of that ancestor and therefore now was entitled to succeed to the properties for his lifetime, subject always to the claim of the deceased's widow, the appellant, to maintenance.

6. The learned trial judge rejected the first respondent's defence of an anterior Tso, holding the deceased to have died possessed of the properties as sole beneficial owner thereof. He also held against the A.G. on the issues of the validity of the appointment of the first respondent as a joint manager and the removal of the appellant. As to the appointment of the first respondent as a joint manager this was held invalid as being an appointment made by the Land Officer and not, as the section requires, an appointment reported to and approved by him. I have already referred to the reason for holding the removal of the appellant invalid. In the circumstances of the appeal we are not concerned to review any of the foregoing decisions.

7. However, among the claims for relief made by the appellant plaintiff was a claim for a declaration, in effect, that the properties are not now Tso properties and therefore are not subject to section 15 of Cap. 97; his forms the substance of the appeal. The interest of the appellant in claiming such a declaration is not clear; apparently her pecuniary rights would not vary according to whether the properties devolved on her husband's death as property to which he was solely and beneficially entitled or became the subject of a Tso following his death by reason of the 'transaction' the subject of the instrument registered in 1912. It appears that the appellant is entitled to appoint a successor to her late husband by way of adoption and it appears that the first respondent is entitled to be so adopted as the nearest male descendant in the male line from an ancestor common to himself and the deceased. Whether the properties became the subject of a Tso depends on what occurred in 1912, that is to say when the memorial was registered recording the appointment of the appellant and the two others, since deceased, as managers of what was then styled the "Li Wah Fuk Tso". The appellant in fact signed the memorial by affixing her mark thereto. It is suggested that the transaction, if one may call it such, was simply a means of assisting a young widow, as the appellant then was, in the management of the properties - particularly to assist her in enforcing collection of the rents, which otherwise as a young female she might find difficulty in collecting. This, in my view, is entirely inconsistent with the evidence of the expert witness, Mr. Akers-Jones, who said, in effect, that it was customary to form a Tso on the death of a male person dying without male issue. The other expert witness, Mr. Hu, corroborated that the expression 'Tso' when added to the name of a deceased person connotes that, by the custom prevailing in the New Territories, his property then becomes 'ancestral property', not merely that the deceased is dead. My impression is that the appeal is based on the misapprehension, in the face of the expert evidence, that the question whether or not property is Tso property is concluded by ascertaining whether it was Tso property as at the date of death of the deceased. [This is not to say that a living person may not, during his lifetime, create a trust to which section 15 of the New Territories Ordinance (Cap. 97) applies, as was held to have been done in the case of Chu Tak-hing & Others v. Chu Chan Cheung-kin & Others⁽¹⁾ (per Scholes J.) That however is not the present case and I mention it only because counsel for the appellant appeared to rely on it.] On the issue of a claim for a declaration as aforesaid, in my opinion, the appeal fails. It fails, I would emphasise, by reason of the expert evidence as it was adduced in the present case and which therefore the learned trial judge was entitled to accept.

8. The A.G. cross-appeals from the order made by the learned judge that the costs of the proceedings be paid by the two respondents; in what proportions he did not expressly state. In support, reliance is placed on section 44 of Cap. 97, which reads:-

The A.G. also relies upon the latter part of the proviso (b) to section 17 of the Crown Proceedings Ordinance (Cap. 300) which reads:-

As to section 44 of Cap. 97 the argument for the Crown is that exemption from liability includes exemption from all forms of liability, including the consequential liability of costs; if an action against the Crown cannot succeed how can costs, a mere incident of liability, be awarded against the Crown? The contrary argument is that if the Crown chooses to defend a claim for a declaration on the merits the usual consequences as to costs must follow. Here it is important to observe that from the very commencement the Crown entered a caveat, as it were, the A.G.'s statement of defence expressly pleading reliance on section 44 of Cap. 97. As to proviso (b) to section 17 of Cap. 300 it is argued on behalf of the A.G. that section 44 of Cap. 97 is "an enactment expressly relieving any department or officer of the Crown of the liability to pay costs". Alternatively, it is argued for the A.G., inasmuch as before the Crown Proceedings Ordinance the rule was that the Crown neither paid nor received costs (see Johnson v. The King⁽²⁾) it would have required very plain enactment to impose liability for costs on the Crown in a case where it is exempt from liability (as under section 44 of Cap. 97); inasmuch as, at the time section 44 was enacted, not only was the Crown thereby exempted from liability in the suit but also, under the common law rule, was not liable for costs, plain words would have been required to impose liability for costs. It is argued for the appellant that this is precisely what section 17 of Cap. 300 did; further, that 'liability' in section 44 of Cap. 97 means a liability in damages, i.e. does not extend to costs.

9. We have been referred to no authority on the point, which is by no means free from difficulty. I have considered the case of R. v. Llanidloes Licensing Justices⁽³⁾) where the applicant moved for an order of mandamus against the justices and the justices failed to take advantage of a statute (the Review of Justices Decisions Act, 1872) under which they might have filed affidavits setting out their reasons for their decision but instead chose to appear by counsel to oppose the motion. The divisional Court held that the justices had thereby made themselves a party to the lis and thus rendered themselves liable to have an order for costs made against them. The circumstances of the present case, however, are different in that the A.G. was made a defendant by the appellant at the outset of the proceedings. The question then, as it appears to me, is this: does the A.G. by defending the proceedings render himself liable to costs if unsuccessful, or merely run the risk, if unsuccessful, of having to bear his own costs? The position can hardly be different according to whether the claim made is one for damages or one for a declaration, as it appears to me. I find it an attractive argument on the part of the A.G. that the overall exemption from liability brought about at the time of the enactment of section 44 of Cap. 97 (extending as such exemption did, in the then state of the law, to exemption from payment of costs) should not be held to have become partially whittled away by the Crown Proceedings Ordinance. Cap. 97 was, and remains, an enactment of particular application whereas Cap. 300 is a general enactment; section 44 of Cap. 97 would lose much of its virtue if whilst protecting the Crown from liability to damages it failed to protect it from a consequential burden such as costs, and I find it difficult to conceive that Cap. 300 had that, indirect, effect. I would also hold the case to fall within the spirit and intendment of proviso (b) to section 17 of Cap. 300. Nor do I think that it was necessary to make the Crown a party.

10. I would therefore dismiss the appeal with costs, and allow the cross-appeal with costs. In any event, a question arises as to the extent to which the Crown, as a second defendant concerned only with some of the issues, should be liable for the costs of the trial and of the cross-appeal.

Representation:

Litton (Samuel Soo & Co) for Appellant

1st Defendant in person Stape, c.c., for 2nd Defendant.

(1) (1968) H.K.L.R. 542.

(2) (1904) A.C. 817.

(3) (1957) 2 All E.R. 610.