Lee Sui Heung v. Cheung Yiu Co Ltd

DCCJ 1907/2015

[2018] HKDC 1188

IN THE DSTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 1907 OF 2015

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Coram: His Honour Judge Harold Leong in Court

Date of Hearing: 3-5 July and 6 September 2018

Date of Judgment: 26 September 2018

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JUDGMENT

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1.This is an action for adverse possession on the part of the plaintiff against the defendant.

2.The plaintiff’s case is that she has come to Hong Kong in 1979. She was living with her two brothers who ran a chicken farm. The chicken farm occupied the land owned by the defendant (Lot Nos. 565, 567, 569 and 570 in D.D. 28 in Tai Po New Territories, “the Disputed Land”) as well as other private land and Government land (“the Farm”). The current case only concerned with the Disputed Land.

3.The plaintiff claims that both her brothers have left the Farm in 1983 and she has been in exclusive and continuous use, possession, occupation and control of the Farm (inclusive of the Disputed Land) since then.

Preliminary issue

4.The plaintiff made an application at the beginning of the trial to re-amend the Amended Statement of Claim to put in an alternative plea of 12-year’s possession commencing on a date after 1 July 1991.

5.This was rejected by this Court on the ground that the plaintiff was bounded by her pleaded case of adverse possession commencing in 1983. Section 38A of the Limitation Ordinance imposes a 20-year limitation period under the circumstances. It would not be up to the plaintiff to suggest that, in case that failed, she would alternatively plead that she was actually in adverse possession after 1 July 1991 in order to take advantage of the shorter 12-year limitation period. (Chan Ching Mui v. City Breeze Ltd [2018] HKDC 16)

6.This Court will therefore only consider whether adverse possession is established for a continuous period of at least 20 years between 1983 and 30 June 2011.

Legal principles

7.The legal principles of an adverse possession is trite and need not be repeated here (Wong Tak Yue v Kung Kwok Wai & Anor (1997-98) 1 HKCFAR 55 and Incorporated Owners of San Po Kong Mansion v Shine Empire Ltd (2007) 10 HKCFAR 588).

Exclusive possession

8.As for the requirement of factual possession, fencing is the most classic act of establishment of exclusive possession.

9.In the current case, although the plaintiff claims that “rudimentary fences” had already been erected by her brothers around the Farm in 1980, these are self-serving evidence with no corroborating objective evidence.

10.In fact, the experts in this case (Mr. Leung Chi Yan George instructed by the plaintiff and Mr. Joseph Wong Yiu-cho instructed by the defendant), having examined the relevant aerial photographs and survey sheets, are in agreement that the fence in the northeastern side of the Farm (identified as “FX2” in the “Identification Plan” dated December 2014 on p.358 of Trial Bundle C) can only be first “observed at about 10 metres outside the eastern tip” of Lot 565 in the aerial photograph of 2008 (p.340 of Trial Bundle C).

11.However, I do note that the experts agree that at least part of the fence in the southwestern side of the Farm (identified as “FX1” in the “Identification Plan”) can be seen as long ago as 1980. But this fence did not encircle the entire perimeter of the Farm.

12.Further, the experts also agree that, from the survey sheets, that the gate structure which blocked access to the Farm (identified as “S8” in the “Identification Plan”) was first found on 19 February 2009.

13.I therefore hold that although the plaintiff’s brother might have erected a “rudimentary fence” in 1980, this fence would have been part or all of “FX1” identified by the experts and would have, at most, fenced off the southwestern side of the Farm. The fencing FX2 and the gate S8 were not built until around 2008-2009.

14.I find that the Farm has not been effectively enclosed to the exclusion of outsiders until 2008 or 2009. Given the circumstances of this case that this is a farm with dwellings on a hillside near a village, I find that the plaintiff has failed to establish exclusive possession until 2008 or 2009.

Animus possidendi and the tenancy

15.Evidence also showed that the plaintiff’s husband, Mr. Chan Meng Kwan (陳敏君, “Mr. Chan”) appeared to have operated the Farm as a tenant of a landlord.

16.The District Lands Office of Tai Po Lands Department has disclosed a hand-written tenancy agreement (pp.188 to 189 of Trial Bundle F) which described a yearly tenancy for HK$1,100 per year for 13 years from 16 October 1984 to 1997 (and with an option to negotiate for extension after the tenancy expired). The owner was stated as a Mr. Wong Chuen (黃全) and the agreement appeared to be signed by a Mr. Wong Sing Cheung (黃勝章) as the landlord and Mr. Chan as the tenant.

17.There appears to be two versions of this tenancy agreement (see pp.158-159 of the Trial Bundle F). The content appears to the identical but the handwriting is different.

18.Mr. Chan has not been called to give evidence because of his mental condition as the plaintiff claimed (and supported by a psychiatric report).

19.However, there are plenty of corroborative evidence for the existence of this tenancy. Mr. Chan appeared to have made 10 applications for agricultural loans between 1993 and 1997.

20.These applications forms (respectively dated 9 January 1993, 7 July 1993, 6 January 1994, 1 July 1994, 5 January 1995, 11 July 1995, 2 January 1996, 8 July 1996, 17 December 1996, 27 May 1997: pp.138-157 of Trial Bundle F) all stated that there was a tenancy agreement with landlord Wong Sing Cheung from 16 October 1984 to 1997 for annual rent of HK$1,100. Thus the information in all 10 application forms was entirely consistent with the tenancy agreement. These application forms all appeared to be signed by Mr. Chan.

21.The address appearing on the tenancy agreement also matches the address stated on the Application for Livestock Keeping License which is dated 23 November 1994 and appeared to be signed by Mr. Chan.

22.In addition, Mr. Chan appeared to have also applied for an agricultural loan under the livestock waste control scheme and that application form dated 14 June 1989 (pp.111-112 of Trial Bundle F) also stated that the Farm was rented. Here it stated that the rent was either HK$1,600, 1,700 or 1,800 (there appeared to be some corrections on the figure) and the landlord was Wong Sing Cheung. This form also appeared to be signed by Mr. Chan.

23.Against these evidence, the plaintiff’s only response was that she did not know any of this, and did not know whether Mr. Chan had paid any rent. I find that hard to believe: Mr. Chan is the plaintiff’s husband and they have been living together since Mr. Chan came to Hong Kong in 1981.

24.In any case, it is trite law in an adverse possession claim that although the standard of proof is the civil standard, “the burden is a heavy one. The squatter has to adduce objective and compelling evidence”. (Birkenhead Properties and Investments Ltd. v Lam Kai Man HCMP 1588/2013).

25.Even if there is factual possession, the plaintiff has the burden to provide compelling evidence that the possession was adverse and not attributable to a license or tenancy (Wu Yee Pak v Un Fong Leung (2004) 7 HKCFAR 498) otherwise the adverse possession is deemed to be for the benefit of the licensor (Tsang Foo (aka Fu) Keung and Key Kwong Development Ltd. v Chu Jim Mi Jimmy [2015] 6 HKC 200 (CFI)) or the landlord (Cheung Yan Fok v Tang Tak Hong (2004) 7 HKCFAR 70), as the case may be.

26.This raises another matter: the fact that Mr. Chan signed the tenancy agreement as a tenant and filled in various application forms in the capacity of the tenant undermines the plaintiff’s argument that she was the one in possession and control but not Mr. Chan. The plaintiff has simply suggested that it was the tradition to do so: that the husband should deal with the “external matters” and the wife, “internal matters”. This is also self-serving subjective evidence and not the “objective and compelling evidence” that is required.

27.As Mr. Chan was not called to give evidence, the court cannot speculate further as to the nature of the tenancy agreement, the identities of Wong Chuen and Wong Shing Cheung (and how they came to claim to be the landlord), or indeed any “traditional” arrangement between the plaintiff and Mr. Chan. The court does not need to make a finding on the exact nature of such: there is ample compelling objective evidence to show that there was no intention to possess (animus possidendi) the Farm until at least 1997 against which the plaintiff has clearly insufficient evidence to oppose.

28.During the closing submission, arguments were raised as to whether the tenancy agreement should be admissible as evidence as it was not stamped. I think that it was very late in the day to raise such an objection and in any case, even if the tenancy agreement was deemed inadmissible, there were 11 documents over the span of some 8 years which supported the existence of this tenancy which, by themselves, would be sufficient evidence.

Conclusion

29.In view of above, I find that the evidence from the plaintiff falls very far short of being “objective and compelling” to establish factual exclusive possession of the Disputed Land for a continuous period of 20 years between 1983 and 30 June 2011. Her claim for adverse possession must therefore fail.

30.The defendant has made a counter-claim for damages against the plaintiff for trespass but has not produced any evidence on quantum.

31.The plaintiff suggested that the court should adopt the method of using the annual ratable value to calculate the mesne profit as in Leung Wai Ip v Chan Ming Fai DCCJ 677/2014. Unfortunately, the court has only the evidence of the ratable value of the year 2017-2018 (pp.292-295 of Trial Bundle B) but the defendant’s case was that it was the registered owner of the Disputed Land since 15 April 1982.

32.In any case, the defendant submitted in closing submission that it would accept a nominal award on damages / mense profit.

33.In such a case, in view that the defendant has failed to submit sufficient evidence on quantum or provide the calculation of such, the court will not award any damages.

Order

34.I would therefore make the following orders:

i)   The plaintiff's claim be dismissed.

ii)   The plaintiff do deliver vacant possession of the Disputed Land to the defendant.

iii)   There be an order nisi that the costs of the action including the counterclaim be to the defendant with certificate for one counsel.

Miss Eugenia Yang, instructed by Khoo & Co, for the plaintiff

Mr Chan Chi Hung SC leading Mr Derek JY Chan, instructed by Foo & Li, for the defendant