Darren Robert Barton v. Discovery Bay Services Management Ltd

LDBM 23/2018

[2020] HKLdT 1

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

BUILDING MANAGEMENT APPLICATION NO 23 OF 2018

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BETWEEN

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Before: Deputy District Judge W. Y. HO, Presiding Officer of the Lands Tribunal, in Court

Date of Hearing: 2^nd September 2019

Date of Decision: 10^th January 2020

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D E C I S I O N

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1.This is the application for the applicant to appeal out of time and the cross appeal applications of both parties against my judgment dated 28^th December 2018 (“the Judgment”).

2.I have set out the background of the case in paragraphs 2 – 12 of the Judgment and do not intend to repeat the same. I shall also adopt the same abbreviations used in the Judgment.

THE APPLICANT’S APPLICATION FOR LEAVE TO APPEAL OUT OF TIME

3.An application for leave to appeal must be made within 28 days from the date of the judgment: see Rule 30B, Lands Tribunal Rules (Cap 17A). In the event the time for such application has expired, the tribunal may extend the time for making such application under Rule 30D, Lands Tribunal Rules.

4.The relevant principles to consider when deciding whether leave to appeal out of time should be granted are succinctly set out by the Court of Appeal in the case of Ng Yui Tong v Taikoo Shing (Management) Ltd, [2019] HKCA 353:  

“C1. Applicable principles

21.The relevant approach to determine an application for extension of time to appeal is well established and has been conveniently summarized by Kwan JA in Lee Chick Choi v Best Spirits Co Ltd (HCMP 371/2015, 21 May 2015, Kwan and Chu JJA) at paragraph 19:

“The legal principles regarding an application to extend time for an appeal are well established. In the exercise of its discretion, the court will take into account the length of the delay, the reasons for the delay, the chances of the appeal succeeding if an extension of time is granted, and the degree of prejudice to the other party if the application is granted…”

22. Further, where a delay is inexcusable although insubstantial, a party seeking an extension of time must show a real prospect of success on the merits: see Secretary for Justice v Hong Kong & Yaumatei Ferry Co Ltd [2001] HKCA 422; [2001] 1 HKC 125 at 129I applying Chiu Sin Chung v Yu Yan Yan Angela [1993] 1 HKLR 225 at p229.”

Delay

5.The Judgment was handed down on 28^th December 2018 and the applicant’s application for leave to appeal out of time was filed on 4^th February 2019.

6.The applicant has not file an affirmation to explain the reasons for the delay in the present application. The only explanation being provided to the tribunal is by way of submissions from the applicant’s counsel, Ms Wong.

7.Ms Wong submitted the applicant and the legal advisers had considered whether it was appropriate to appeal after the Judgment was handed down. Despite believing the applicant had grounds for making an application for leave to appeal, the applicant decided not to do so. It was not until the applicant received the respondent’s application for leave to appeal did the applicant re-consider his position. To paraphrase Ms Wong’s submissions, the present application is made to protect the applicant’s position on costs in the event the respondent is ultimately successful in their appeal application.  

8.Having considered Ms Wong’s submissions, I am of the view the delay is plainly inexcusable. There is simply no reasonable explanation for the delay. The applicant was legally represented throughout the proceedings. Ms Wong frankly admitted the legal team had studied the Judgment and considered whether an appeal should be made. It was the conscious decision of the applicant, after the benefit of legal advice, not to make an application for leave to appeal.

9.Since the length of delay cannot be said to be substantial, I now proceed to consider the merits of the appeal.

Merits of the intended appeal

10.There are 3 grounds of appeal set out in the applicant’s draft notice of appeal. However, I am of the view the grounds of appeal can be summarized as follows:

1)  The finding the 17 January Notice and 27 April Notice was not “invalid per se” is an error in law.

a)  Even if the respondent had the authority to convene an owners’ meeting, it did not and should not have done so via the 17 January and 27 April Notices.

2)  The findings are inconsistent in that I held the respondent should not have refused to carry out the poll vote as directed by the applicant, but on the other hand I held the 17 January and 27 April Notices are not “invalid per se”.

11.I have already set out my ruling on the 17 January and 27 April Notices. As I had explained, I was of the view the issue as framed by counsel is incorrect. The issue as framed and agreed by counsel was as follows: “Whether the management notice dated 17 January 2018 setting aside the Directed Poll Vote and the notice dated 27 April 2018 to convene the Proposed Meeting are valid.”

12.I have already set out, at paragraph 38 of the Judgment, my observation that the 17 January Notice does not “set aside” the Directed Poll Vote per se. Hence the issue framed by counsel regarding the 17 January Notice is not correct.

13.Furthermore, I have set out my reasoning, at paragraph 39 of the Judgment, to explain the respondent had the authority to convene the meeting pursuant to Clauses 3 and 4 of Section VIII(A) of the Sub-DMC. I disagreed the notices were invalid per se as the respondent had the power to issue such notices to convene an owners’ meeting.

14.Although I have not granted the declarations sought on the 17 January and 27 April Notices, I went on to find the respondent should not have refused to carry out the Directed Poll Vote and that any resolution passed at a meeting convened by the 27 April Notice which seeks to override the Directed Poll Vote may be liable to be set aside. In substance, I had ruled in favour of the applicant on this issue.

15.Having considered the applicant’s intended grounds of appeal, I do not find there to be any reasonable prospects of success in his application for leave to appeal, even if a time extension is granted.

16.I therefore refuse the applicant’s application for leave to appeal out of time.

THE RESPONDENT’S APPLICATION FOR LEAVE TO APPEAL

17.The respondent raises 8 draft grounds of appeal in their application. I am of the view the grounds can be summarized as follows:

1)  I have erred in the construction of Clause 10 of the Sub-DMC in the following manner:

a) Failing to consider the context of the Sub-DMC, in particular Section VIII of the Sub-DMC.

b) Failing to consider the construction of Clause 10 and 11 of the Sub-DMC in the context of the factual and legal background against which the Sub-DMC was drafted.

c) Failing to consider Clauses 11, 12, and 13. 

2)  In respect of the Directed Poll Vote, I erred in:

a) Failing to hold the Directed Poll Vote was invalid;

b) Failing to hold the Directed Poll Vote should have taken place immediately;

c) Holding the January Meeting was open and also holding the Directed Poll Vote could be conducted outside the January Meeting;

d) Failing to hold the Directed Poll Vote could not be a continuation of the January Meeting.

Construction of Clause 10 of the Sub-DMC

18.Counsel for the respondent in the present applicant argued that Clauses 1, 2, 3, 6, 9, 12, 14, 15 and 17 of Section VIII of the Sub-DMC show an owner must attend an owners’ meeting either personally or by proxy to vote.

19.I have set out my reasoning on the construction of Clause 10 of the Sub-DMC at paragraphs 18 – 28 of the Judgment and do not intend to repeat the same.

20.I was fully aware of the respondent’s argument that the clauses of the Sub-DMC should be construed by reading the Sub-DMC as a whole (see paragraphs 14 and 15 of the Judgment). Furthermore, I have also indicated in the Judgment my construction of Clause 10 of the Sub-DMC is based on the proper reading the Sub-DMC as a whole (see paragraph 18 of the Judgment).

21.In summary, having read the Sub-DMC as a whole, I did not find any clause in the Sub-DMC, or the effect of the clauses of the Sub-DMC being read together, to mandate any poll vote directed by the   chairman to be carried out at a physical meeting. It is clear Clause 10 of the Sub-DMC allows the chairman to have the unfettered discretion of directing a poll vote to be taken “at such time and in such manner as the chairman shall direct.”

22.Contrary to the respondent’s argument, the distinction between the meeting itself and the voting procedure can be seen in Clause 11 where different procedures are provided for voting by way of a show of hands and voting by way of a poll vote.

23.In so far as counsel seeks to argue I have failed to give effect to Clauses 12 and 13, I have already set out my comments relating to possible invalid votes at paragraphs 24 – 27 of the Judgment.

24.The chairman’s discretion to direct a poll vote is dictated by the Sub-DMC and therefore it is for the chairman to consider possible problems that may arise from his directions. The problems caused by the chairman’s direction is not to be confused with the proper interpretation of the Sub-DMC. I reiterate it is not for this tribunal to remedy any inadequacies of the drafting of the Sub-DMC.

25.In so far counsel seeks to draw an analogy between the Sub-DMC, “Hong Kong’s electoral law,” and the repealed Multi-storey Buildings (Owners Incorporation) Ordinance 1970 (Cap 344) (“the MBO”), I note these are new submissions which were not raised during trial.

26.In any event, I do not accept counsel’s submissions in this regard. I find the analogy drawn with the “Hong Kong electoral law” to be irrelevant to the proper construction of the Sub-DMC. As for the repealed MBO, I do not accept the provisions of the MBO cited by counsel (sections 3, 4, 5, and section 3(3) of the Third Schedule) have any relevance to the poll vote that is specifically provided for in the present Sub-DMC.

27.Hence, by reason of the matters set out above, I do not find any prospects of success in the grounds relating to the construction of Clause 10 of the Sub-DMC.

The Directed Poll Vote

28.I shall not repeat my reasoning in respect of my finding that the Directed Poll Vote was validly made. I shall deal with the criticism that paragraphs 23 and 37 of the Judgment are inconsistent.

29.There is no dispute the January Meeting was a validly convened meeting where owners physically attended to discuss matters raised on the meeting agenda. There is also no dispute the election of the VOC members was an item on the agenda. 

30.As I had set out in the Judgment, there is a distinction being made in the Sub-DMC between the nomination of the VOC members and the actual voting procedure. As set out in paragraph 19 of the Judgment, Clause 17 of the Sub-DMC only requires two things to be done at the physical meeting: the proposing and seconding of the candidates, and the names of the candidates be put before the physical meeting for voting.

31.The actual voting of the VOC members is then dictated by Clause 10 of the Sub-DMC in which the chairman may direct a poll vote. There is no clause in the Sub-DMC which dictates the actual voting of the members be conducted at the physical meeting. Conversely, pursuant to the discretion bestowed upon the chairman by Clause 10 of the Sub-DMC, the chairman had the absolute discretion to dictate the time and manner in which the poll vote was to be carried out.

32.If the Sub-DMC had intended to restrict any poll-vote to be carried out at the same physical meeting, the chairman would not have been given the unfettered discretion to determine the time and manner of such poll vote.

33.It is in this context in which paragraph 23 of the Judgment is to be understood.

34.Since the election of the VOC members has yet to be concluded because the chairman had directed the actual election process be conducted by way of a poll vote, the agenda item is not yet concluded. Hence, in so far as the election of the VOC members are concerned, the January Meeting remains “open”.

35.I therefore do not accept counsel’s submissions that the said paragraphs of the Judgment are inconsistent.

36.By reason of the matters set out hereinabove, I fail to see any reasonable prospects of success on the respondent’s intended grounds of appeal.

Any other reason in the interests of justice for the appeal to be heard

37.I have considered counsel’s submissions on the same.

38.I do not accept this case has far reaching consequences for the election of office bearers of an owners’ committee in Hong Kong. Each DMC of each multi-storey building is different. Furthermore, I do not find there to be some other reason in the interests of justice why the appeal should be heard.

39.By reason of the matters set out above, I dismiss the respondent’s application for leave to appeal.

40.I make a costs order nisi that there be no order as to costs on both the applicant’s application for leave to appeal out of time and the respondent’s application for leave to appeal. Unless any party applies to vary the costs order nisi within 14 days hereof, the costs order shall become an order absolute.

Ms Wong Lok Woon Carol, instructed by Li & Partners, for the applicant

Mr Ng Kong Fat Lawrence, instructed by S K Lam, Alfred Chan & Co, for the respondent