Ngai Sau Ying v. Henry Chue Kwok Keung

CACV000030A/1982

Landlord and Tenant (Consolidation) Ordinance - effect of amendments contained in Ordinance No. 76 of 1981 on pending actions. Periodic tenancies should now be terminated by notice to quit before an action for possession is commenced but the amending Ordinance does not act retrospectively so as to affect pending actions (Remon v. City of London Real Property Co. Ltd.⁽⁷⁾ not followed). The former section 74A(aa) in cases in which it applies prevents an order for possession from being made to take effect on a date earlier than a date by which a landlord could have recovered possession if a notice to quit or notice of termination had been given.

BETWEEN

____

Coram: Leonard, V-P., Cons, J. A. and Kempster, J.

Date: 7 May 1982

___________

JUDGMENT

___________

Leonard, V-P.:

1. Before considering the effect of the most recent amendments to the Landlord and Tenant (Consolidation) Ordinance and the question whether or not in this particular case the landlord must fail because he did not terminate the appellant's tenancy by a valid notice to quit or a notice of termination under Part v, I think it would be as well if I referred to the history of the recent legislation.

2. The first thing to notice is that no notice to quit was required at the date of the writ. We are told that this has been recognised since 1975. Lo Wah v. Chui Fung⁽¹⁾ decided on the 26th November 1980 did no more than give judicial recognition to what had been generally accepted.

3. Well prior to that decision the legislature had enacted Ordinance No. 6 of 1980 which retrospectively afforded protection to tenancies previously unaffected, by the deletion from section 53(2) of paragraph (i), (j) and (k) with effect from the 18th December 1979.

4. On the 26th June 1981 Lam Chun Kuen v. Wan Suet Ying ⁽²⁾ decided that a landlord of premises the subject of a tenancy for three years might issue a writ for their recovery while the term still subsisted provided that the order for possession be drafted so as not to have effect until after the expiration of the agreed term. There the tenant had argued and the landlord conceded that one must respect the contractual bargain between the parties but the case led to some misgivings as to whether landlords were because of the wording of sections 52 and 53 as then expressed, obliged to make any such concession. Would the law permit a landlord to grant a term of years and notwithstanding his contractual bargain seek possession for occupation by himself before the term had expired?

5. Some such considerations may well have led to the enactment on the 10th July 1980 of Ordinance No. 52 of 1981 which resulted in the addition to the Ordinance of section 74A (aa). That subsection laid down that nothing in Part II of the Ordinance should permit any tenancy or sub-tenancy to be terminated earlier than would have been the case if Part II had not been enacted. This new subsection did not come into force until after Lo Wah's ⁽¹⁾ case and Lam Chun Kuen's⁽²⁾ case were decided. Whether or not Lam Chun Kuen's⁽²⁾ case prompted its enactment, that case and the new subsection may have created anxiety in the minds of those advising landlords as to the necessity of terminating periodic tenancies by notices to quit before issuing proceedings or at any rate before an order for possession could be obtained. I may say that were I called on to decide whether section 74A(aa) rendered a notice to quit necessary I should have held that it did not, provided that a period equal to the period of notice required by Common Law had passed between the date of service of the writ and the date upon which the order for possession became effective. I should have referred particularly to the word "earlier" in the phrase "terminated earlier than would have been the case" if Part II had not been enacted and have asked myself "Will my order for possession result in the tenancy being terminated 'earlier' than it would have been terminated had the landlord himself terminated it by notice to quit".

6. Section 74A(aa) was not to be long for this world (although it has been suggested that its effects still linger) for it was deleted with effect from the 19th December 1981 by Ordinance No. 76 of 1981 which received the Governor's assent on the 10th December 1981. This is a complex Ordinance, the terms of which demand careful scrutiny.

7. Before I consider their effect, however, it is necessary for me to consider the position of the respondent before such, if any, of them as were in operation on the date of hearing, the 14th January 1982 came into operation. On the 23rd March 1981 the respondent had by the issue of the writ done everything which it was necessary for him to do and in view of the facts which were proved at the trial might confidently have anticipated that the District Court would make an order for possession in his favour. Section 53(2) it is true, did not say "If satisfied that any of the following matters are proved the District Court shall make an order for possession". It said -

"The Court shall not make an order for possession of premises in respect of which there is a tenancy or sub-tenancy to which this Part applies unless it is satisfied that ...."

8. Cons, J. A. considered this in Lo Wah & Anor. v. Chui Fung ⁽¹⁾ when he said at page 849 -

"Secondly, the English judge was not bound under the older statute to make an order for possession even though the landlord had conclusively proved one or more of the conditions pre-requisite under, for example, section 5 of the 1920 Act. The judge had then to consider whether it was also reasonable to make the order. The position is still the same although the wording of the relevant section in the present 1968 Act is considerably changed. The Hong Kong judge is given no such discretion. Our legislation has adopted the general form of the opening part of section 5 of 1920 Act but has omitted, deliberately as I see it, the discretionary qualification. Although that first part is phrased in what might perhaps be termed 'the permissive negative' it is difficult to see on what ground a judge could refuse an order once a landlord had brought himself within one of ..the paragraphs (a) to (f)".

9. That case dealt, as does this, with a tenancy from month to month. Cons, J.A. was not presented, nor are we, with a tenancy for a fixed term as was the Court in Lam Chun Kuen's⁽²⁾ case and save insofar as it is of historical interest I can regard Lam Chun Kuen's ⁽²⁾ case as irrelevant. 'Although the appellant's tenancy continued on and after the 23rd March 1981 the respondent had a right to claim that it be terminated by the Court and he therefore had a good cause of action.

10. That right crystalised on the issue of the writ although the tenancy would not terminate until an order took effect. In my view, it became an accrued right on the issue of the writ. Mr. Chan, if I understood him correctly, argued that the nature of the protection given to the tenant under the Ordinance indicated that when enacting Ordinance No. 76 of 1981 the legislature intended that the new law should thenceforth be applied. That is a different matter. It amounts to a suggestion that section 23 of Cap. 1 should not be applied. This I will discuss later - what I am concerned with at present is the legal position of the respondent at the time of the issue of the writ. In my view by its issue the right to apply for and be granted an order of possession then accrued.

11. Was his position changed by Ordinance No. 52 of 1981 and in particular by section 74A(aa)? I can not see that it was for the reasons I have already given I have not the slightest doubt that were it not for Part II the respondent would long since have obtained possession. It was the protection given by Part II that delayed him. That Part II enabled a landlord to gain possession without a notice to quit was not something that permitted the tenancy to be terminated "earlier than it would have done" if Part II had not been enacted. The tenancy had to be terminated by the Court which could ensure that it would not be terminated "earlier" than if a notice to quit was given. What section 74A(aa) sought to protect was the tenancy of a tenant who enjoyed a tenancy for a fixed term and the protection it afforded was protection against interference with the tenancy until the contractual period had expired. As Mr. Kwok succinctly pointed out section 74A(aa) was concerned with the duration of the tenancy not with the mode of its determination. The only case dealing with this matter which has been brought to our attention was Lau Kwan v. Keung Sit Kai,⁽³⁾ a case decided by Clough D. J. Adopting a commonsense approach he decided that its effect was to require the Court to ensure that the order does not take effect earlier than the date when the monthly tenancy of the defendant would have been liable to be determined by the plaintiff by the service of an appropriate notice to quit. I would approve that approach. However it was not contended before Clough D.J. that the effect of section 74A(aa) was to activate Part V of the Ordinance. Although Mr. Chan's approach to section 74A(aa) was somewhat oblique, he so contended and obtained our leave (granted for the same reasons as those earlier adumbrated by Kempster J. when indicating our consent to have the original notice of appeal argued) to amend the notice of appeal so as to add a reference to the necessity of a notice of termination under Part V of the Ordinance.

12. Prior to Ordinance No. 6 of 1980 section 50(5) of the principal Ordinance had laid down that tenancies to which Part II applied should not, s o long as Part II continued to affect them, be subject to Part V. This provision was deleted by Ordinance No. 6 of 1980 which with effect from 15th February 1980 provided for an amendment of section 121, the section governing the application of Part V. This amendment provided in so-many words that Part V "shall not apply" "to a tenancy to which Part II applies". We are asked by section 74A(aa) to accept that Part II had not been enacted. If it had not been enacted section 121(2)(ba) would be meaningless. Part V would apply if (ba) were omitted and the lapse of a period equal to the length of a notice of termination would be necessary. Hence, whether or not it intended to do so, the legislature would appear to have achieved a somewhat bizarre result. It prevented a Part II tenancy expiring earlier than it would have expired if a notice of expiration under Part V had been given. That is academic in this case because of the period of time that did elapse before the tenancy was terminated by the order taking effect.

13. There is one other case to which I should draw attention prior to considering the effect of Ordinance No. 76 of 1981. Lam Wai v. Mak Yok Jan⁽⁴⁾ dealt with the provisions of Ordinance No. 6 of 1980 which came into effect on the 15th February 1980. Two days before the Ordinance came into effect the landlord had obtained in the District Court an order for possession of domestic premises the subject of a tenancy for a fixed term of three years which had expired on the 19th January 1980. The landlord had issued his writ on the 21st January 1980 and had obtained a speedy judgment by applying to strike out the defence. After the enactment of Ordinance No. 6 of 1980 the tenant applied for a review. The review application was considered on the 4th March 1980. The original order was confirmed on the 7th March 1980. It is to be noted that prior to Ordinance' No. 6 of 1980 tenancies lasting for a minimum of three years were excluded from the protection of Part II of the main Ordinance. Ordinance No. 6 of 1980 brought such tenancies within the scope of the main Ordinance for the first time by the deletion of paragraph (j) with effect from the 18th December 1979 so that the landlord's original right to possession of the premises on the expiry of the three year lease came not from the unamended Ordinance but from the Common Law. Hence section 23(c) of the Interpretation and General Clauses Ordinance (Cap. 1) did not apply. The case turned essentially on two matters. It turned firstly on the effect on an order of a District Judge and  its being open to review and is authority for the proposition that so long as an order is open to review it is not res judicata. Secondly it turned on the proposition that the necessary intention of Ordinance No. 6 of 1980 was that it should effect pending cases. The Ordinance was enacted on the 15th February 1980 but given retrospective effect to the 18th December 1979 in that paragraph (j) was deleted retrospectively from that date and the amendment prevented any tenancy whether created before or after that date (ie. "whenever created") from terminating during the continuance in force of Part II. It is to be noted that by a remarkable coincidence the tenancy in that case did not elapse by effluxion of time until the 19th December 1979. It had been created before the 18th December 1979 and the contractual relationship of landlord and tenant still existed on the 18th December 1979 although it ceased on the very next day. It was because of these unusual facts that the case was decided as it was decided. I turn then to Ordinance No. 76 of 1981.

14. In considering its history the Report of the Committee of Review Landlord and Tenant (Consolidation) Ordinance submitted by the Committee to the Governor on the 13th February 1981 is relevant. Chapters 19 and 20 of this Report which refer to legal and judicial matters were perhaps written before judgment in Lo Wah and Anor v. Chui Fung⁽¹⁾ was delivered, on the 26th  November 1980. That case decided that there was no need here as there was in England first to determine the contractual tenancy before pursing the statutory remedy. Although the headnote in that case refers to the contractual tenancy, the tenancy in question was a periodic one from month to month.

15. The report advanced five reasons as to why its authors thought that it was important that the law be clarified to provide either "for a statutory tenancy or for statutory continuance of the contractual term". The "first arises in relation to periodic tenancies. If a statutory tenancy is created it is for a landlord to serve a notice to quit to determine the tenancy before he can obtain possession on any of the statutory grounds. If, on the other hand, statutory continuance is involved it is arguable that a notice to quit is required because the grounds for possession were presumably intended to apply only following the determination of the original contractual term". The second reason for clarification was that "the present law does not make it clear when the grounds for possession apply. There appears to be an assumption that they only apply at the end of the original contractual term. If it is correct, and this seems to be the better view, that the Ordinance provides for statutory continuance of the contractual term it appears that the grounds for possession can apply at any time during the tenant's occupation. We think that it was intended that the grounds would apply only at the end of the original contractual term but this is not stated anywhere in the Ordinance". The third reason announced by the report why the distinction between statutory tenancies and statutory continuance of contractual term is important is "in relation to forfeiture". The fourth reason "concerns the protection afforded to principal tenants following a subletting. If a true statutory tenancy arises, it seems, following United Kingdom Rent Act Principles, that a principal tenant who has sublet will lose security of tenure of that part which he no longer occupies as his home once the contractual term has ended and the subtenant in occupation ought them to become a tenant of the superior landlord". The fifth reason concerns the applicability of Part II to corporate tenants. The Committee continues "after careful consideration, we feel that what was intended in the existing Ordinance was a true statutory tenancy. We believe that a consistent adherence to this concept would help to clarify the law and implement the underlining policy of the legislation which is the protection of tenants in their homes. On the assumption that rent control and security of tenure would have to continue for the immediate future, we recommend that -

16. It appears to me as likely that the draftsman when preparing the Bill leading to Ordinance No. 76 of 1981 had these recommendations in mind. However he clearly had other matters with which to concern himself, the first of which was the giving to the Lends Tribunal of the jurisdiction in landlord and tenant matters previously enjoyed by the District Court.

17. The sections of Ordinance No. .'76 of 1981 which concern me here are section 1, section 35 (which amends section 52 of the principal Ordinance) section 36 (which amends section 53), section 51 (which deletes the former 74A(aa)) and section 59 (said to be transitional)

18. [The Governor has not yet by notice in the Gazette appointed a day upon which the Lands Tribunal are to assume functions under sections 53 and 53A of the principal Ordinance so that for "Tribunal" in those sections and in section '68B the words "District Court" still appear where the word "Tribunal" is to appear.] The new subsection 1 of section 52 of the principal Ordinance which came into operation on the 19th December 1981 now reads as follows-

19. The sections I have set out are the only provisions of the amending Ordinance mentioned to us in argument. It is to be noted that the new sections 52 and 53 of the principal Ordinance came into force on the 19th December 1981. It is also to be noted that as from the same date paragraph (aa) of section 74A of the Ordinance was deleted. This paragraph although not in force at the trial or at the date of the issue of the writ, was in force while the case was awaiting trial.

20. I would seek to analyse section 52 in manner following -

21. From this analysis it appears to me that the Tribunal (Court) now has' jurisdiction only after the contractual period has ended (in the case of a tenancy for a fixed term) or after the contractual tenancy (in the case of a periodic tenancy) has been terminated by notice to quit. Something in the nature of a "statutory tenancy" in the English sense has been created. Although I doubt if it has the marks of an English statutory tenancy. It maybe something more than a personal right to remain. I would utter a word of caution here for those considering the effect of the termination of a fixed term by effluxion of time. If a tenant holds over after such termination and the landlord receives rent a periodic tenancy may be created which in its turn would require to be determined by notice to quit before resort to the Tribunal (Court). I do no more than mention this and do not propose to discuss whether or not a new tenancy may be implied by acceptance of rent in such a case. That is not for consideration here.

22. To sum up this part of the argument I am of the opinion that in all cases commenced on or after the 19th December 1981 a landlord must show that the contractual tenancy has been determined. In practice this means that a notice to quit is necessary for periodic tenancies.

23. I turn then to the question whether the amending Ordinance (NO. 76/81) has retrospective effect. For ease of reference I set out the following dates -

24. Mr. Edward Chan, for the appellant, properly conceded that if the law applicable was that in force at the date of the issue of the writ his appeal must fail but submitted firstly that the law applicable was that as amended by Ordinance No. 76 of 1981. If he was wrong on this he suggested that section 59(1) of that Ordinance brought into play section 74A(aa) which he suggested required a landlord to give a notice of termination under Part V of the Ordinance.

25. His argument that the law applicable was that as amended by Ordinance No. 76 of 1981 was twofold firstly that the respondent had no accrued right and secondly that, even if he had, section 23 of the Interpretation and General Clauses Ordinance (Cap. 1) should not be applied as a contrary intention appeared from Ordinance No. 76 of 1981. As to the question of accrued right Mr. Chan conceded that the respondent had at the date of the writ a right to claim immediate possession but the right, he suggested, was no more than a right to claim and not a right to get possession. I have already dealt with this and essentially it is answered by the first concession Mr. Chan made i.e. that he was out of court if the law applicable was that in force at the date of the issue of the writ. The important consideration here is whether Ordinance No. 76 of 1981 should have retrospective effect notwithstanding the provisions of section 23 of Cap. 1 and the general rules of interpretation that accrued rights should not be interfered with unless there is a clear indication to that effect in the legislation under consideration and then not to a greater extent than is necessary.

26. In arguing that the landlord's right should not be interfered with Mr. Kwok relied on National Real Estate and Finance Co. Ltd. v. Hassan⁽⁵⁾ a case which dealt with the Leasehold Property (Repairs) Act 1938 which created a system of notice and counternotice under section 146 of the Law of Property Act 1925 and in which it was provided that the Act "applies to leases created, and to breaches ocurring before or after the commencement of this Act". It was held that the Act was not retrospective so as to apply to a case where an action had been commenced before the passing' of the Act to recover possession of premises for breach of a covenant to repair, Scott L. J. observing at page 72. "In my judgment the appeal succeeds, and succeeds on the broad ground that there is nothing in the Act of 1938 which is intended to alter past rights which became vested before the new Act came into operation by reason of the parties acting upon, and being entitled to act upon, the law as it stood before the new Act came into operation" (emphasis added) and later "The question, in my view, is a very short one: Is there anything in the 1938 Act which entitles the defendant to say that it takes away the rights of landlords who have strictly complied with the Act of 1925 ..... on the ground that the Act deals solely with matters of procedure and, therefore, may be given retrospective effect? In my view it is wrong to treat the new Act as a procedural Act; where vested rights are effected, prima facie it is not procedural ...... If then, the Act is not procedural in character is there anything in it which provides that rights already acquired shall be affected? Unless there is something which is quite clear in the Act, and must be so interpreted, the court is not entitled to treat the Act as having retrospective operation". (emphasis added)

27. In Hutchinson v. Jauncey⁽⁶⁾ the question arising was whether the application of the Landlord and Tenant (Rent Control) Act 1949 was excluded by reason that the plaint was issued before the 1949 Act came into force. The Court does not appear to have been referred to National Real Estate and Finance Co. Ltd. v. Hassan⁽⁴⁾ However it was argued that by the issue of the plaint the landlord had acquired a vested right and should not be deprived of that right unless in plain terms that conclusion flows from the language of the new Act and Evershed M.R. observed "if the necessary intendment of the Act is to affect pending causes of action, then this Court will give effect to the intention of the legislature even though there is no express reference to pending actions". He poses as one what are really two questions -

28. In answering these questions he found assistance in Remon v. City of London Real Property Co. Ltd.⁽⁷⁾ which he regarded as having "laid down the application of a principle to this class of legislation generally". He finds that the principle on which Remon v. City of London Real Property Co. Ltd.⁽⁷⁾ was decided is to be found in the following passage of the judgment of Banks L.J. "It is, however, clear that in all the Rent Restrictions Acts the expression 'tenant' has been used in a special, a peculiar sense, and as including a person who might be described as an ex-tenant, some one whose occupation had commenced as tenant and who had continued in occupation without any legal right to do so except possibly such as the Acts themselves conferred upon him. The respondent was therefore on the coming into operation of the new Act a tenant within the meaning of that expression in the Act". On that basis he finds that the defendant in the case before him is a tenant ("an ex-tenant sitting there against the will of the landlord and claiming that the Rent Acts protect him"). Relying also on a provision in section 10 that the three foregoing sections should apply whether the letting in question began before or after the commencement of the Act he found that section 9 applied to the tenancy.

29. Such reasoning does not appear to me to be open here. The principle enunciated by Bankes L. J. and regarded by Evershed M. R. as the principle on which Remon's case was decided is not available to the respondent because the expression "tenant" has not been used in our legislation in the peculiar sense in which it is used in the English legislation. Our legislation has protected the tenancy rather than the tenant and premises have never been "protected premises". It is the tenancy which does not come to an end. It seems to me that the landlord had a vested right which became an accrued right on the issue of the writ and that right should not be interfered with unless there is something which is "quite clear in the (Ordinance) and must be so interpreted". With the possible exception of section 59 when read with section 1(2) I can find nothing.

30. The objects of a Bill may be looked at to ascertain its history and the mischief at which it is aimed and in order that the Court may treat the Ordinance resulting as remedial and give it a liberal construction so as to attain its object as it is enjoined to do under section l9 of the Interpretation and General Clauses Ordinance, Cap. 1. The objects of the Bill in question were to abolish the Tenancy Tribunal and to transfer some of its functions to the Commissioner of Rating and Valuation with an appeal to the Lands Tribunal; to transfer certain functions to the Lands Tribunal from the District Court; to amend the provisions of Part II relating to the continuation of tenancies and rights of sub-tenancies.

31. These general purposes may also be deduced from the general "make-up" of the Ordinance No. 76 of 1981. The first 34 sections concern themselves with the abolition of the Tenancy Tribunal, the transfer of its functions from the. District Court. Of these 34 sections sections 1, 16, 17 and 18 came into force on the 19th December. Sections 16,17 and 18 deal with the transfer to the Commissioner of functions of the Tenancy Tribunal. The others are to come into force on a day or days to be appointed by the Governor. Sections 35 and 36 concern themselves with the amendments to sections 52 and 53 of the principal Ordinance. Section 53A is added by section 37 and restricts the making of an order under section 53(c) while sections 38 and 39 amend respectively sections 54 and 55. Sections 40, 41, 42 concern themselves with the transfer of functions and again do not come into force until a day to be appointed. Section 43 deals with the application of sections 54, 55, 57 to 61 to sub-tenancies and came into effect on the 19th December 1981 as does section 48 which adds a new section 68B and thus restricts the making of orders as to costs. Section 52 repeals and replaces Part IV of the principal Ordinance dealing with new tenancies of domestic premises and provides for continuation of tenancies not effected by Part II. Sections 53 to 58 are consequential and need not concern me while section 59 is the section which Mr. Chan suggests, indicates the intention to deprive the landlord of his right to possession. The question I must resolve is whether this is a "necessary intendment" of the section. Must it be so interpreted? By section 1(2)(a) section 59 also came into force on the 19th December 1981 but by section 1(2)(b) until a day not yet appointed sections 53 and 53A and 68B of the principal Ordinance are to have effect as if for "Tribunal", there were substituted "District Court". Until the appointed day therefore it is the District Court that makes an order under sub-section 2 of section 53 and it is to the District Court that one must go to obtain such an order. This it is necessary to bear in mind when considering the intendment of section 59. Mr. Chan, if I understand him correctly contends that where a District Court has not before the 19th December 1981 commenced to hear a matter which by the Ordinance becomes a matter within the jurisdiction of the Lands Tribunal then the matter shall be "disposed of" in accordance with the amendments contained in the amending Ordinance. This, he says, follows as a necessary corollary from section 59. I would with respect agree with Mr. Chan when he argues that the District Court had not on the 19th December 1981 commenced to "hear" this matter. The only steps that had been taken were insufficient to amount to a hearing. But I do not think that section 59 necessarily gives rise to the corollary for which he contends, particularly when one bears in mind that the Lands Tribunal can not enjoy jurisdiction until the appointed day. That is the effect on section 53 of the principal Ordinance of section 1(2)(b) of Ordinance No. 76/81. Certainly it is far from being clear to me that the legislature intended by this section or that the section "must be so interpreted" that the Ordinance must have retrospective effect so as to destroy the landlords right. I do not think that a matter must necessarily become "by this Ordinance" a matter within the jurisdiction of the Lands Tribunal until the appointed day nor that by the words ''shall dispose of such matter ...... as if this Ordinance had not been enacted" the legislature necessarily intended the corollary for which Mr. Chan contends.

32. I would therefore conclude that the amendments did not nullify the right of the landlord acquired under the former sections 52 and 53 of the principal Ordinance and would dismiss this appeal with costs.

Cons, J. A:

33. I have had the advantage of seeing in draft the judgments prepared by my Lord the Vice-President and Kempster, J. They have arrived at the same conclusions to which I have been lad by my own deliberations. I would dismiss the appeal.

Kempster, J.:

34. As from 1973, if not before, it has been accepted in many of the District Courts, contrary to the normal requirements of the Common Law, that when a landlord seeks possession of rented post-war residential property he does not have to show that the term of the lease had expired or, in the case of a periodic tenancy, that the tenant's contractual rights had been determined by the expiry of a valid notice to quit, before the issue of proceedings. This is because, until the 19th December 1981, section 52(l) of the Landlord and Tenant (Consolidation) Ordinance, Cap. 7, to which I shall refer hereafter as the principal Ordinance, read as follows -

"Subsection (1)
Save as provided in sub-section (2) and section 53 no tenancy or sub-tenancy, whether created before or after the 15th of December 1973, shall terminate during the continuance in force of this Part."

Sub-section (2) read and still reads -

"Subject to section 50(4) a tenancy or sub-tenancy shall not by virtue of this Part continue in existence after any change in the identity of the tenant, principal tenant or sub-tenant which would terminate such tenancy or sub-tenancy in law."

Section 53 provided for the termination of a tenancy or sub-tenancy in the circumstances therein set out.

35. That the District Courts' appreciation of the law was correct was confirmed by this Court in the case of Lo Wah & Anor. v. Chui Fung⁽¹⁾ but in Lam Chun Kuen v. Wan Suet Ying,⁽²⁾ after a concession by counsel for the landlord, this Court added the rider than an order should not be made to take effect before such time as the fixed term of a tenancy had expired.

36. Between the 10th July and the 18th December 1981 section 74A of the principal Ordinance included a sub-paragraph (aa), reading -

"Nothing in this Part .(Part II) shall permit any tenancy or sub-tenancy to be terminated earlier than would have been the case if this Part had not been enacted." Section 9 of Amending Ordinance No. 52 of 1981 and section 51 of Amending Ordinance No. 76 of 1981

Deeming Part II not to have been enacted, in the context of termination, necessarily brought the Common Law position as between landlord and tenant once more into consideration and also robbed section 121(2)(ba) of effect. That sub-section had, as from the 15th February 1980, excluded, from the ambit of Part V, tenancies to which Part II applied. Accordingly and subject to the provisions of Part V it appears to me that the expiry of a fixed term and of a valid notice to quit limited the earliest date upon which a court (taking due account of section 53(4))could make an order for possession effective. In no other way could it be ensured that a tenancy which, having regard to the terms of section 52(1), could not be terminated otherwise than therein provided, was not brought to an end earlier than it would have been by the landlord or by the tenant as the case might be had not Part II been enacted. Section 122 which, by parity of reasoning, became applicable to Part II tenancies read as follows -

These provisions approximated a periodic tenancy and a tenancy for a fixed term insofar as notice was required for both. The expiry or determination of the contractual term did not then become a condition precedent to the commencement of proceedings, however, as has been the position since 19.12.81.

37. As from the 19th December 1981 Amending Ordinance No. 76 of that year, which deleted section 74A(aa) from the principal Ordinance, by section 35 provided, in a new section 52(1), that a tenancy the contractual period of which has been determined by effluxion of time or by one of the parties otherwise than by forfeiture [and neither could determine a periodic tenancy otherwise than by notice] should not unless vacant possession were delivered up and subject to sub-section (2) and section 53, come to an end during the continuation or continuance in force of Part II. Sub-section (2) is not material.

38. By virtue of section 36 of Amending Ordinance No. 76 section 53(1) of the principal Ordinance now reads -

We are not concerned with sub-section (6A) in this appeal. But section 121 sub-section (2)(ba) is no longer robbed of effect. There is no provision like that in the earlier Amending Ordinance requiring the Court to act as if Part II did not exist. So no statutory minimum period of notice is required to determine a periodic tenancy and no notice is required when a fixed term has expired.

39. The effect of the new and current sections 52 and 53 is, therefore, firstly to give a tenancy the contractual period of which has come to an end but where vacant possession has not been given an indefinitely extended currency on substantially the same terms, save as to time and right to forfeit, as the contractual tenancy created by agreement between the parties. Such statutorily extended tenancy can only be brought to an end pursuant to section 53(1). Secondly, the two sections limit the operation of section 53 to tenancies so extended. Looked at from the landlord's point of view, he cannot proceed against the tenant at Common Law unless the tenancy has lawfully been determined or the contractual term has expired. Even when it has been determined or has expired the statutorily extended tenancy nonetheless continues by operation of law until and unless vacant possession is given or an order is made by the Court in accordance with the principal Ordinance as amended. The landlord has no cause of action until the contractual period of the tenancy has come to an end. For completeness I should refer to the current section 52(1C) which reads -

"A tenancy or sub-tenancy which immediately before the 19th December 1981 was continuing under this Part shall be a tenancy or sub-tenancy continuing under sub-section (1)".

In my view this provision continues the protection afforded to a tenant the contractual period of whose tenancy had come to an end prior to the date stated.

40. The writ in this action, claiming possession of certain premises within the ambit of Part II of the principal Ordinance and let on a periodic tenancy, was issued on the 23rd March 1981 while Lo Wah v. Chui Fung (supra) remained good law. In accordance with such law and practice the plaintiff did not aver the service or expiry of a notice to quit. No application was made to strike out the claim and no point on the absence of a notice to quit was taken at trial. No more was any application made to this Court to amend the pleading or to prove service or expiry of notice. Judgment was given in the plaintiff landlord's favour and an order for possession made (stayed for 4 months on terms) on the 14th January 1982 pursuant to the provisions of section 53(2) of the principal Ordinance on the basis that the law to be applied was that applicable as at the date of writ. The question falling for our determination can therefore be expressed in the form of this question: "Were all involved in the trial of this action right in acting on the footing that the law applicable was that prevailing on the 23rd March 1981 and not that prevailing in January 1982?" At the earlier date the plaintiff was entitled to commence proceedings, as he did, on the basis that the only hurdle which he had to surmount was that of satisfying the Court that he reasonably required Flat B at No. 1A Minden Row, Kowloon, for his own personal occupation and, should the tenant contend that it was neither just nor equitable for an order to be made, of rebutting the suggestion; the burden of proof in that regard remaining throughout on the tenant. This was a right vested in the landlord under the detailed provisions of the principal Ordinance as then enacted and such a right is not to be deemed destroyed without the clearest words in an Act of Parliament (or Ordinance) per McCardie J. in Bowling v. Camp⁽⁸⁾ at page 34. National Real Estate and Finance Co. Ltd. v. Hassan⁽⁵⁾ illustrates the wording of an amending statute insufficiently clear to rebut the normal presumption and Hutchinson v. Jauncey;⁽⁶⁾ Attorney General v. Vernazza⁽⁹⁾ and Lam Wai v. Mak Yok Jan⁽⁴⁾ illustrate the wording of amending statutes or ordinances that were clear enough so to do. In Hong Kong this proposition of law is given further force by the Interpretation and General Clauses Ordinance, Cap. 1. The material sections areas follows -

"Section 2(1)
Save where the contrary intention appears, either from this Ordinance or from the context of any other Ordinance or instrument, the pro visions of this Ordinance shall apply to this Ordinance and to any other Ordinance in force, whether such other Ordinance came or comes into operation before or after the commencement of this Ordinance and to any instrument made or issued under or by virtue of any such Ordinance.

Section 19
An Ordinance shall be deemed to be remedial and shall receive such fair, large and liberal construction and interpretation as will best ensure the attainment of the object of the Ordinance according to its true intent, meaning and spirit."

Jurisdictional changes apart I must confess that the object, true intent, meaning or spirit of the several amending Ordinances referred to in this judgment have not so been apparent insofar as Part II tenancies are concerned as to allow section 19 to affect my approach to this or any other issue.

"Section 23
Where an Ordinance repeals in whole or in part any other Ordinance, that repeal shall not -

(c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any Ordinance so repealed; or

(d) affect any legal proceedings or remedy in respect of any such right, privilege, obligation, liability as aforesaid, and any such legal proceeding may be instituted, continued or enforced as if the repealing Ordinance had not been passed."

I have omitted certain words irrelevant to the matter under consideration.

41. To the question: "Is there anything in Ordinance No. 52 of 1981 indicating an intention that it should have effect retrospectively, either to the date of writ or to the date of trial?" the short answer is "no". As regards Ordinance No. 76 of 1981 the sections warranting consideration are 35 and 59. The former, in amending section 52 of the principal Ordinance, introduced section 1C. Its effect, as I have briefly mentioned, is to include in the category of tenancies enjoying a statutorily extended .. currency those the contractual periods of which had come or been brought to an end prior to the 19th December 1981 and which, therefore, had been continuing pursuant to and by reason of the provisions of Part II rather than by reason of contract. Section 59 reads as follows -

"(1) A District Court or Tenancy Tribunal which has heard or commenced to hear any matter or proceeding which, by this Ordinance, becomes a matter or proceeding within the jurisdiction of the lands Tribunal or the Commissioner of Rating and Valuation shall continue to have jurisdiction in relation to and shall dispose of such matter or proceeding as if this Ordinance had not been enacted.

(2) Any matter or proceeding pending before a District Court or Tenancy Tribunal but which a District Court or Tenancy Tribunal has not heard or commenced to hear and which, by this Ordinance, becomes a matter or proceeding within the jurisdiction of the lands Tribunal on the Commissioner of Rating and Valuation shall be continued before the Lands Tribunal or Commissioner, as the case may be, and the Lands Tribunal may give such directions as it thinks fit as to the lodging or filing of papers and otherwise in relation to the procedure in such a matter or proceeding."

Both sections appear to me to be concerned rather with jurisdiction than with substantive law. But if I am wrong and the District Court had "commenced to hear" the matter or proceeding by the 19th December 1981(as to which it is unnecessary to make any finding) sub-section (1) does no more than confirm that the plaintiff's rights are unaffected by the amending Ordinance while sub-section (2) is equivocal. It certainly does not entitle the defendant to say that he may now avail himself of the provisions of the amending Ordinance so as to invalidate the rights which the plaintiff had acquired before the Ordinance was passed. National Real Estate and Finance Co. v. Hassan (supra).

42. In the event my answer to the question I have posed is that all those involved in the trial of this action were right in acting on the footing that the law applicable was that prevailing on the 23rd March 1981. It also follows that, in my opinion, this appeal must be dismissed.

(1)     (1980) H. K. L. R. 844

(2)     C.A. 47 of 1981.

(3)     K. C .J. Action No. 30/81

(4)     (1980) H. K. L. R. 236

(5)     (1939) 2 K. B. 61

(6)     (1950) 1 K.B. 574

(7)     (1921) 1 K.B. 49.

(8)     (1922) 39 Times Law Reports 31

(9)     (1960) A. C. 965

Representation:

Mr. Edward Chan (Peter Mo & Co.) for appellant

Mr. Kenneth Kwok (Wilkinson & Grist) for respondent