Kwok Shu v. The Incorporated Owners of Kent Building
Read the full judgment text of DCCJ 1572/2017 on BabelCite. This District Court judgment was delivered on 25 May 2021.
1. This is a water leakage case.
Cited by 1 case · Cites 6 cases
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DCCJ 1572/2017 [2021] HKDC 632 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CIVIL ACTION NO. 1572 OF 2017 -------------------- BETWEEN
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-------------------- JUDGMENT -------------------- Introduction 1.This is a water leakage case. 2.Mr Kwok is the registered owner of Flat B, 13th Floor, Kent Building (“the Building”), Nos.39 and 39A Jordon Road, Kowloon (“Flat 13B”) which is a residential unit. He alleges water seeps into Flat 13B through a part of the roof of Kent Building which is immediately above Flat 13B (“Roof B”). The Incorporated Owners of Kent Building (“the IO”) has been the registered owner of the external walls and the roof (including Roof B) of the Building since 2008. Mr Kwok now accuses the IO of breaching the statutory duties under the Building Management Ordinance, Cap. 344 (“the BMO”), the Deed of Mutual Covenants of the Building (“the DMC”), nuisance and negligence causing the water leakage problem. Mr Kwok claims against the IO for both injunctive relief and damages. 3.The IO denies liability and quantum of damages claimed by Mr Kwok in the pleading. The IO has a counterclaim and it was disposed of by way of a consent order dated 16 September 2019. Issues 4.At trial, Mr Chan, for the IO, indicated that it is accepted that Roof B is the source of water leakage into Flat 13B. The live issues are reduced to the following:
Background facts 5.The background facts are not controversial and can be outlined as follows. 6.The Building was constructed in 1966 and it is for residential use. There are 13 storeys and there are 4 units on the 13th floor, namely, Flats 13A, 13B, 13C and 13D. Mr Kwok acquired Flat 13B in or about May 1990 and has been its sole registered owner till now. 7.The roof of the Building (“the Roof”) consists of Roof A, which is the part of the roof immediately above Flat 13A and Roof B. By a licence agreement dated 24 September 1987, On Year Development Limited granted a licence to one Madam Fong expiring on 18 August 2012 for the use of Roof B. By an assignment of licence dated 1 May 1990, Madam Fong assigned the licence with the same expiry date to one Hon Kwok Ching (“Hon”). 8.As soon as Mr Kwok purchased Flat 13B from Hon, he entered into a written licence agreement dated 28 May 1990 (“the Licence Agreement”) with Hon whereby Hon as sub-licensee assigned her licence (“the Licence”) to Mr Kwok as the 2nd sub-licensee of Roof B with the same expiry date. 9.The IO acquired, among other things, Roof B by an assignment dated 30 June 2008 at the nominal price of HK$1.00. 10.In the minutes of a meeting of IO dated 27 March 2012, it was recorded that the owner of Flat 13B had sent to the IO a letter requesting for an extension of the Licence in respect of the Roof. 11.In the end, the IO refused to grant an extension and the Licence ceased to exist in 2013. 12.Returning to Flat 13B, once it was acquired, Mr Kwok caused the same to be partitioned into 3 suites (known as Room A, Room B and Room C) and each of them has its own kitchen and washroom. They have been let out for rental profits. 13.At the Roof, there is a canopy (“the Canopy”) and a parapet wall (“the Parapet Wall”) and it is about 3 feet in height and 40 feet in length. The Parapet Wall separates Roof A and Roof B. 14.The Building has been managed by CITI-PRO Property Services Co., Ltd. (“the Management Company”). 15.By a renovation contract dated 31 August 2010, the IO engaged a contractor known as “宏業建築工程有限公司” (“the 1st Contractor”) to carry out renovation works at the Building. 16.In the minutes of a meeting of the IO held on 26 October 2010, it was recorded that the project consultant偉略工程顧問有限公司(“the 1st Consultant”) overseeing the renovation works explained that due to the existence of the structures including a toilet, a small brick house and the Parapet Wall in the public area of the Roof, waterproofing works could not be carried out. The lawyers of the IO and the Management Company had written to the owner concerned to demolish or authorize the IO to demolish those structures but the owner ignored the request. Due to the complaint of the owner of the flat below about water seepage, the IO found it necessary to convene that meeting to pass a resolution to authorize the IO to remove those structures. 17.The resolution was passed and the 1st Contractor attended the said meeting. 18.After Mr Kwok demolished the toilet at Roof B and the IO demolished other structures on the Roof in 2013[1], the 1st Contractor completed the waterproofing works on the Roof including the Canopy. 19.國盛建築工程有限公司 (“the 2nd Contractor”), another contractor, was engaged by the IO to undertake waterproofing works on the Roof in 2014. In the minutes of a management committee meeting held on 7 January 2014, it was record that the 2nd Contractor reported that the waterproofing works on the Roof had been completed and a water test was administered and passed, as confirmed by the project consultant 藝博建築顧問有限公司 (“the 2nd Consultant”). It was further reported that the owners of the top floor, i.e. the 13th floor and other owners did not complain about water seepage any more. 20.Despite the completion of such works, the water seepage problem actually persisted. 21.The IO engaged another contractor Kin Hei Engineering Limited (“the 3rd Contractor”) to carry out further water resistant works on the Roof in June 2016 and February 2017 in view of the continuous complaint of Mr Kwok. 22.By a surrender of lease agreement, one Mr Ko agreed with Mr Kwok to terminate the tenancy on 20 February 2017 for the specific reason that there was water seepage in the ceiling of Room A and the wall was covered with mold. I note that the tenancy in fact was due to expire on 22 February 2017. 23.Shortly afterwards, Mr Kwok commenced these proceedings against the IO on 29 March 2017. 24.On 13 June 2017, 15 June 2017 and 18 July 2017, Mr Yeung who is a watchman employed by the Management Company, attended Flat 13B and recorded in his logbook that the water seepage problem persisted. 25.I now turn to the DMC to ascertain the obligations of the IO in its capacity as the registered owner of the Roof. 26.Under clause 26 of the DMC, each of the owners covenants with the others:-
27.Further，the Roof falls within the definition of “common areas” in the DMC:
Relevant legal principles 28.Section 18(1) of the BMO provides that an IO,
29.Indeed, Mr Chan, in his closing submissions, indicates his agreement that Roof B is a common part of the Building and the IO under section 18(1) of the BMO has the foregoing duties. 30.Mr Chan refers to Lo Yuk Chu v Hang Yick Properties Management Limited [1996] 4 HKC 278 in his submission that the duty of an IO in respect of common facilities is not absolute under the DMC. In that case, Power ACJ gave the judgment for the Court of Appeal. It is only necessary for me to set out the holdings in the law report:
31.These holdings are well known and in fact often cited, as Kwan VP did so in Lam Suk Yee and Wu May Ling v The Incorporated Owners of Kam Kin Mansion [2019] HKCA 1289 at §48. 32.Mr Wan, for Mr Kwok, is in agreement with this submission of Mr Chan. He seeks to argue that the IO has failed to act reasonably to rectify the water seepage problem throughout the years. Evidence 33.Mr Kwok is the factual witness for his claim. Mr Andrew Kung, a chartered surveyor, is Mr Kwok’s expert witness. He compiled his expert report dated 25 October 2018. 34.The IO called 5 factual witnesses. They include Ms Ng who was the operation manager of the Management Company, Mr Yeung, Ms Chan who has been a member of the IO since 1999, Mr Leung who was the chairman of the Management Committee from 2001 to 2013 and Mr Ho who is a registered owner of a flat of the Building. 35.The IO engaged Mr Jacob Tsang as their expert witness. He made an expert report dated 26 October 2018. 36.Mr Kung and Mr Tsang produced a joint statement dated 14 December 2018 (“the Joint Statement”). 37.Whilst I accept Mr Wan’s valid complaint about the alarming similarities of the witness statements of the defence witnesses, which I believe the legal advisors should share the lion share, if not the entirety, of the blame, the defence witnesses were far more impressive than Mr Kwok in the witness box. They appeared to be forthcoming and straightforward. Mr Kwok, on the other hand, testified unconvincingly and was unable to instill confidence in this court. The overall impression this court got is that the evidence of the defence witnesses, largely supported by contemporaneous documents, is more credible and should be preferred to those of Mr Kwok whenever they are in conflict. 38.That said, the evidence of the defence witnesses is of little assistance to the factual disputes calling for the determination of this court. In light of the expert evidence leading to the parties’ agreement as to the cause of the current water leakage problem of Flat 13B, their evidence about the past disputes such as whether or not Mr Kwok had exclusive use of the structures at Roof B and his past non-cooperation with the repair works carried out by the Contractors is no longer relevant. In any event, those matters are evidenced by contemporaneous documents such as the Licence Agreement and the minutes of the relevant meetings, the authenticity of which is not challenged. 39.As regards the expert witnesses, Mr Kung testified in a logical and reasonable manner and this court has no hesitation in accepting his evidence. On the other hand, Mr Tsang’s evidence is speculative, making conclusions without solid evidential basis. It does not really assist this court. Analysis 40.Though it is now accepted by the defence that the cause of the current water leakage problem of Flat 13B is the Roof, I still find it necessary to set out the relevant findings of Mr Kung which are accepted by this court to provide the backdrop for the resolution of the Contribution Issue and the Discharge of Duties Issue. 41.In the report of Mr Kung, the contents of which is not challenged, he stated that he carried out his first inspection to Flat 13B together with Mr Tsang on 3 September 2018. He arranged a water ponding/spraying test to be carried out on 29 September 2018 and the test was completed on 2 October 2018. The test was conducted by an independent contractor known as RECL and throughout the test the weather was fine save on 1 October 2018 there was a slight rainfall of 2.9 mm. 42.According to the test results recorded by RECL, both waterproofing systems on the main roof and on the roof of the balcony, i.e. Roof B, are defective as there is evidence of water seepage from these two roofs. On the other hand, the storeroom on the Roof (“the Storeroom”) is ruled out to be a source of water seepage due to the lack of evidence. 43.Pursuant to a court order, Mr Kung and Mr Tsang held a without prejudice meeting on 8 November 2018 to discuss their opinions in their respective expert reports. Their agreements and disagreements were recorded in the Joint Statement. 44.In the Joint Statement, the following agreed matters of Mr Kung and Mr Tsang were stated. First, there has been water leakage/seepage to Flat 13B in the past and the problem is still persisting. The affected areas are mostly under the outer roof. Furthermore, from the result of the test, the Roof is certainly the course of the water leakage/seepage problem. 45.Both Mr Kung and Mr Tsang could not tell whether the external walls are also a source of the water leakage in the absence of any such evidence. Contribution Issue 46.I first study the pleading of the IO in relation to the Contribution Issue. 47.In §42 of the Defence and Counterclaim, it is pleaded that the water leakage/seepage problem were and are caused or wholly contributed to by Mr Kwok’s wrong-doing. The particulars given are as follows:
48.Mr Kwok in his Reply and Defence to Counterclaim admits his continuous occupation of the Storeroom but he denies ever refusing the workers of the Contractors to enter into the Storeroom to carry out remedial works thereat. He makes a plea of adverse possession of the Storeroom in opposition to the counterclaim of the IO for vacant possession of the Storeroom. 49.As stated above, the IO’s counterclaim has been stayed by consent. 50.I accept Mr Kung’s observation that there is no evidence that the Storeroom is a source of the water leakage. Even Mr Tsang does not suggest so. There is simply not a shred of evidence to support the allegations pleaded relating to the Storeroom. They must be rejected accordingly. 51.On this basis alone, the Contribution Issue can be disposed of in favour of Mr Kwok. 52.Much has been said about the structures erected by Mr Kwok on the Roof during the currency of the Licence. Mr Tsang, though without any sight of such structures, asserted that they should have damaged the waterproofing system of the Roof thereby causing the water leakage problem. 53.I am not minded to delve into such evidence. This unpleaded allegation is, to start with, not open to the IO. I further reject Mr Tsang’s suggestion as mere surmises. In any event, it is common ground that those structures were demolished in 2013 and the IO can have no excuse not to take reasonable steps throughout all these years to restore the waterproofing system on the Roof thereafter. Mr Kwok cannot claim any relief for the water leakage problem prior to 2013 anyway. 54.To conclude, I do not find Mr Kwok is, to any extent, responsible for the water leakage problem. Discharge of Duties Issue 55.In the pleading, it is not denied that the water leakage problem has persisted since the 1990s. It is well-documented. 56.The IO merely relies on the engagements of the 1st, 2nd and 3rd Contractors to show that the IO has already taken all reasonable and practicable steps to solve the water leakage problem. In particular, the IO avers that the staff of the Management Company inquired with the tenant of Flat 13B in May 2017 after the completion of the remedial works undertaken by the 3rd Contractor and the tenant made a confirmation with the staff of the Management Company that there were no longer any water leakage problem in Flat 13B (“the Confirmation”). 57.Thus, it contends that it has discharged its statutory duties under the BMO and its other duties under the DMC. 58.Given this position, there is really nothing in the complaint of the IO that Mr Kwok had caused obstructions to the Contractors in their execution of remedial works on the Roof. Their works were completed and successfully rectified the water leakage problem in the end once and for all despite the alleged obstructions anyway. 59.This position is untenable and is not even supported by its own expert evidence. Mr Tsang agreed in the Joint Statement that the water leakage problem has persisted. The test results evidenced the persistence. So did the evidence of Mr Yeung. 60.In his pleading, Mr Kwok actually admits the Confirmation but he explains that it is due to the lack of rainfall during the time after completion of the remedial works by the 3rd Contractor in February 2018 and the time when his tenant made the Confirmation in May 2018. His tenant complained about the water leakage problem subsequently. 61.The explanation actually accords with common sense. The Confirmation is plainly not reliable to prove that the water leakage problem has been completely solved. 62.Mr Chan submits that there is no suggestion that any of the 1st, 2nd and 3rd Contractors and the 1st and 2nd Consultants are unqualified for water-proofing works and the IO has already taken reasonable and practicable steps by engaging qualified independent contractors to deal with the water leakage problems. 63.I cannot agree with this submission. Of course it is understandable that the IO may not have the expertise to solve a water leakage problem and, more often than not, it should require a qualified independent contractor to assist. In choosing a qualified independent contractor, inevitably it has to pay heed to the recommendation of the project consultants or the Management Company. The IO is made up of owners only and no particular expertise can be expected from its members. 64.It is, therefore, only reasonable to allow some time for the IO to find a suitable contractor to solve the water leakage problem once it has the knowledge of the problem. I also disagree with Mr Wan that once it was found out the recurrence of the problem, the IO should turn to another contractor. I accept that the IO might reasonably rely on the same contractor to fix the problem within the maintenance period. 65.However, the water leakage problem has persisted far too long in the present case. The IO must be alive to the inadequacies of the Contractors it has engaged. 66.Mr Kung points out that the waterproofing membrance of the Roof is clearly defective, as shown in the photos. Mr Tsang does not dispute this. 67.Quite on the contrary, Mr Tsang observes that there are layers of different waterproofing materials laid on Roof B. It means that each of the contractors simply laid his own waterproofing materials on top of the old layer of waterproofing materials instead of removing them first. This may affect the effectiveness of the new waterproofing materials. Mr Tsang agrees that this is undesirable and inadequate. 68.Both Mr Kung and Mr Tsang opine that a complete re-roofing of the Roof including Roof B and the Parapet Wall could effectively eradicate the water leakage problem. It does not sound like rocket science and there is no reason why the IO could not have come up with this idea earlier after all these years. 69.I then conclude that the IO has not taken all reasonable and practicable steps to solve the water leakage problems and it could not merely rely on the suggestions of the Contractors and the Consultants when the problem has persisted for so long. 70.I also find that the IO is unable to discharge the duties under the BMO and the DMC. The IO has long had full knowledge that water leaks from Roof B to Flat 13B and yet failed to curb the same. Flat 13B has been damaged as shown by the photos taken by Mr Kung. Mr Tsang does not argue otherwise. It is a private nuisance without doubt. 71.For the same reason, the IO is also in breach of its duty of care owed to its neighbour. The IO is also liable to Mr Kwok in the tort of negligence. Relief Issue 72.Mr Kwok asks for damages for inconvenience and discomfort and loss of rental income of Rooms A and B, repair costs of Flat 13B and injunctive relief. 73.For damages for inconvenience and discomfort, Mr Kwok refers to 3 local decisions, namely, Cosmos Legal Consultants Limited v Skycherry Development Ltd & Anor. (unreported, DCCJ 2548/2009, 14.5.2013), Chung Che Shum v Dong Sai Ming Fernando & Anor. (unreported, DCCJ 21504/2001, 15.2.2007) and Leung Yung Chun & Anor. v Chan Wing Sang & Ors. [2000] 1 HKLRD 456. In these cases, the plaintiff was awarded HK$80,000 to HK$100,000 as damages under this head. 74.Mr Chan submits that given the fact that Mr Kwok does not reside at Flat 13B himself, there is no basis for a claim of general damages for discomfort and inconvenience. 75.I find force in the submission of Mr Chan. None of the authorities cited by Mr Wan involved an additional claim for loss of rental profits and the properties affected were actually resided by the plaintiffs in those cases. Here, Mr Kwok admits that he has resided in the Mainland most of the time since 1995 and does not occupy Flat 13B himself. He has not, in his evidence, explained what inconvenience and discomfort that the water leakage problem has brought him in addition to his loss of rental income. 76.Mr Wan submits that if liability is established, it must follow that Mr Kwok is entitled to general damages. He relies on So John & Anor. v Lau Hon Man & Ors [1993] 2 HKC 356. 77.In So John, Rhind J, giving judgment for the Court of Appeal, held that general damages for inconvenience and discomfort can be awarded in a breach of contract action. In that case, the defendant was found to have breached the deed of mutual covenant and the plaintiff adduced evidence of the inconvenience and discomfort he suffered as a result of the water leakage into his residence for a long period of time including the need of extensive repair works to be carried out. Thus, evidence of actual inconvenience and discomfort is required to justify an award under this head. 78.Absent any relevant supportive evidence in the present case, I am not prepared to make any award of general damages. 79.For the claim for loss of rental income in respect of Rooms A and B, Mr Kwok filed his supplemental witness statement to explain his loss. His evidence in this regard is not challenged and Mr Chan says nothing about the same in his closing submissions. 80.Indeed, as recorded in the order of Master S.H. Lee dated 26 August 2019, the parties agree that the reasonable rental value for Rooms A and B is HK$8,500 each for the period from 29 July 2017 onwards. 81.Mr Kwok presents his evidence of loss of rental income in a tabular form in his supplemental witness statement and Mr Wan in his closing submissions updates and revises the table. I am satisfied that in the absence of any contrary evidence and challenge, I should accept Mr Kwok’s evidence in its entirety on this issue, which is shown in the following table prepared by Mr Wan:
82.I am convinced that Mr Kwok should be allowed to recover the sum of HK$503,830.00 as damages for his loss of rental income. 83.With respect to the claim for repair costs, the parties are not too far apart about the appropriate figures. Mr Kung’s assessment of the necessary repair costs is HK$139,000.00 whereas Mr Tsang says HK$131,000.00. I accept the assessment of Mr Kung. I am satisfied that Mr Kwok is entitled to recover such costs from the IO. 84.Hence, I allow a monetary compensation in the amount of HK$139,000.00 under this head. 85.Lastly, in view of the persistence of the water leakage problem and the past failed effort to rectify the same by the IO, I find this a proper case that a mandatory injunction should be granted against the IO to ensure that it would take all reasonable steps to eradicate the water leakage problem, which has long been a nuisance to both the IO and Mr Kwok. I do not agree with Mr Chan that a mandatory injunction would impose an absolute duty on the IO. 86.The proposed term of the mandatory injunction in the closing submissions of Mr Wan appears to be reasonable and it is agreeable to this court. I grant a mandatory injunction that the IO, either by itself, its agent or servant or otherwise, to carry out all reasonably necessary repair to the Roof (including the main roof, balcony roof and the Parapet Wall) of the Building within 6 months to the satisfaction of an authorised person to be jointly appointed by the parties within 3 months at its own costs and expense. Conclusion and order 87.For the reasons given, the claim of Mr Kwok against the IO is amply borne out by evidence. Liability is established and judgment should be entered against the IO. 88.I make an order that the IO should pay Mr Kwok damages in the sums of HK$503,830.00 and HK$139,000.00 forthwith. Interest shall accrue thereon from the date of the Judgment until full payment at judgment rate. 89.I also grant the mandatory injunction stated in paragraph 86 hereof. 90.There is no reason why costs should not follow the event. I make an order nisi that Mr Kwok should have his costs including any costs previously reserved, to be taxed if not agreed, with certificate for counsel. 91.Lastly, I thank both Mr Wan and Mr Chan for their very able submissions.
Mr. Kev L.H. Wan, instructed by HK&JY Solicitors, for the plaintiff Mr. P. K. Chan, instructed by T. H. Wong & Co., for the defendant |
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