Chiu Shun Cheong v. Li Kwok Fung

DCCJ 535/2017

[2021] HKDC 1226

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO 535 OF 2017

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BETWEEN

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DCMP 3168/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 3168 OF 2008

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BETWEEN

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(Consolidated by Order of Master GT Lung dated 5 February 2018)

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Before: His Honour Judge Andrew Li in Court

Date of hearing: 7 to 9 & 16 October 2020

Date of Judgment: 27 September 2021

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JUDGMENT

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INTRODUCTION

1.This is an adverse possession claim brought by Mr Chiu Shun Cheong (“the plaintiff”) in DCCJ 535/2017 (“the CJ Action”) against the defendant Li Kwok Fung (“the defendant”) who is the plaintiff in DCMP 3168/2008 (“the MP Action”).

BACKGROUND

The defendant’s case

2.In the MP Action which was commenced in 2008, the defendant (who is the plaintiff in that case) claims possession of the subject land at Lot No.647 in Demarcation District No 83 together with messuages erections and buildings thereon (“the Land”) by way of originating summons under Order 113 of the Rules of the District Court, Cap 336H (“the RDC”). He also claims the same thing by way of counterclaim 10 years later in the CJ Action. However, the MP Action was laid dormant for over 10 years with the defendant not taken any active steps at all until after the plaintiff has commenced the CJ Action in 2017.

3.According to the defendant, he had purchased the Land by Assignment dated 1 May 1998 from ‘Yeung Ming Tai Tso’ (“The Tso”), with Yeung Chun Wing, Yeung Wan Ching and Yeung Tim Fu as managers of The Tso at the time of the purchase. The consideration was at HK$2,408,868. Land search record confirms the defendant is currently still the paper owner of the Land.

4.According to the defendant, Madam Hung Sau King (洪秀琼) (“Madam Hung”), who was the mother of the plaintiff and 4 of his siblings, had paid the yearly rent of HK$100 to his daughter Ms Li Lai Man (“Ms Li”) since his purchase of the Land. Allegedly, Madam Hung had previously paid rent to The Tso but later paid rent directly to Ms Li.

5.According to the Modification of Tenancy No 5097 (“the MOT”), a permit issued by the District Officer, Tai Po to The Tso, Madam Hung (with her photo affixed on it) was described as an “occupant” for the “erection of structures on the Land”, ie agricultural storage of 12’ x 12’ x 12’, pigsty of 12’ x 12’ x 12’ and chicken shed of 12’ x 4’ x 8’.

6.The defendant says that Madam Hung could not have erected the structures on the Land for her own use without the permission of The Tso and without The Tso in applying for and obtaining the MOT on her behalf. Hence, he claims that Madam Hung (and her children) was more likely than not a tenant, a licensee, a licensee’s licensee or permittee of The Tso for occupying the structures on the Land.

7.The defendant claims that the documents produced show that Madam Hung had been informed of the “illegal structures” and been reminded of the outstanding licence fee for the year of 1963 on 21 September 1963. Both documents indicated that the MOT would be cancelled subject to compliance.

8.The MOT was dated 13 June 1972 in which the Crown (ie the then Hong Kong Government) permits the modification of the “Crown (Government) Lease … of Lot No 647 in D.D. 83 to the extent only that the registered owner Yeung Ming Tai Tso (Yeung Man Hing) permit Hung Sau King (the deceased) may for the period between 1 January 1972 and 31 December 1972 and… to erect and maintain (“the Structures”)…”.

9.The defendant further claims that the MOT contains provisions to allow only the registered owner (previously The Tso and currently the defendant) to renew the application for approval for such non-residential structures. The defendant says that Madam Hung and/or her children (including the plaintiff) could not have maintained the 3 non-residential structures on the Land without the assistance of the land owner (ie previously The Tso and currently the defendant). That means Madam Hung’s use and enjoyment of the said structures and the Land on which they were built depends on whether the owner of the Land renewed the application for such MOT approval, at least according to the defendant.

The plaintiff’s case

10.It is the plaintiff’s pleaded case in the CJ Action that the plaintiff’s mother Madam Hung, had since or around 1961, been in sole exclusive possession of the Land to the exclusion of other persons until her death on 4 January 2011 and therefore had had adverse possession of the Land during her life time. The plaintiff himself has been staying on the Land since he was a child and has never left the Land. Hence, he claims that he also has adverse possessory title of the Land, independent to the claim of that of her late mother.

11.The plaintiff says that there is overwhelming evidence which establishes that the plaintiff and his late mother had been in sole exclusive possession of the Land.

12.Madam Hung stated in her affidavit back on 25 March 2009 (which was made for the purpose of defending the MP Action) that she and her late husband had built a wooden hut over the Land for the use of her family. To that effect, Madam Hung had obtained approval from the authorities in the form of the MOT so that she could build a hut and reside there with her family. The existence of the hut, as well as other structures on the Land, is supported by the findings of the expert and the aerial photographs taken by the authorities over the years.

13.Madam Hung would fence off the Land at its fringes with wooden sticks and iron rods. She further stated that a well had been dug at the corner of the Land and it supplied the plaintiff’s family with water for daily use for many years. There is photographic evidence of the well which supports Madam Hung’s allegation.

14.Madam Hung also had applied for electricity meter and the relevant government permits either under her own name and/or the plaintiff’s father.

15.The plaintiff stated in his witness statement that in the 1970s, his mother had built an underground septic tank on the Land; expanded the existing structures on the Land; and created a front yard by a low brick wall with metal fences surrounding the Land. The allegations are supported by the findings of the expert and the aerial photographs.

16.Madam Hung stated in or about 1971, the wooden hut on the Land was seriously damaged by a typhoon. The roof the wooden hut was peeled off and she had to rebuild the wooden hut with iron plates to make it more durable under strong wind. The Plaintiff has further adduced an Application for Repair/Construction made to the Tai Po District Office for that purpose[1]. This allegation is also supported by the findings of the expert and the aerial photographs[2].

17.Although the documents are both written in Chinese and English and the fact that the plaintiff’s mother was illiterate, she had vividly explained in her affidavit that she had sought the assistance of a village elder by the name of Yeung Man (楊萬) (“Yeung”) whom she had described as “influential and familiar with government officials” and was able to “facilitate the approval of the application”.

18.Madam Hung further stated in her affidavit that in or about 1975, she had modified the pigsty and the chicken shed for domestic purpose, which further supported her case of factual possession over the Land.

19.Moreover, the plaintiff’s sister Kit Wah, Catherine (“Kit Wah”) had filled out an application form for financial assistance at The Chinese University of Hong Kong, stating that her home address was “81 Tung Village, Kwan Ti Village, Fanling, New Territory (sic)” which was the street address of the Land.

20.There is also very clear documentary evidence produced by the plaintiff’s other siblings Kit Wah, Shun Fan (“Shun Fan”), and Ching Wah (“Ching Wah”) who gave evidence at the trial, showing that they had all lived on the Land when they were young. The documents covered the period from 1960s to 70s. These documents have clearly demonstrated that the plaintiff’s family, including the plaintiff himself, his siblings and Madam Hung, were in factual possession of the Land. In other words, they have treated the Land as their residential home since in or around 1961. These documents included:-

(a) a number of handbooks of the plaintiff’s brother from ‘Fanling Kwan Ti Public School’ from the 1960s. These belonged to Shun Fan and show that his residential address was at the Land;

(b) Kit Wah filled out an application form for financial assistance stating her residential address was as ‘81 Tung Village, Kwan Ti Village, Fanling, New Territory (sic)’ when she studied at the Chinese University of Hong Kong;

(c) The Chinese University of Hong Kong delivered a letter to Kit Wah at ‘81 East Village, Kwan Ti, Fanling, New Territories’; and

(d) Kit Wah and her husband Ho Siu Ming gave birth to a daughter named Tung Ching, with the residential address recorded as ‘81 Kwan Tei Tung Tsuen, Fanling’;

DISCUSSION

Issues to be decided

21.At the outset of the case, the following have been identified and agreed by the parties as the main issues to be determined by the Court in this case:-

(a) Whether Madam Hung and the plaintiff had/have been in adverse possession of the Land (“the Adverse Possession Issue”);

(b) If so, what is the period of adverse possession (“the Limitation Period Issue”); and

(c) Whether the title to the Land of the defendant and/or the defendant’s predecessors have been extinguished under ss7, 17, and 38A of the Limitation Ordinance, Cap 347 (“the Extinguishment Issue”).

22.By the end of the evidence at the trial, it has become quite apparent that Madam Hung and/or her family members have been living on the Land since 1962 up to today. During cross-examination, it was put to the defendant by the plaintiff’s counsel that Madam Hung was living in the Land all along of which the defendant’s reply was in the positive. Thus, in view of his answer, this is no longer a live issue as the defendant has unequivocally accepted it was the case.

23.Further, the objective evidence in the form of aerial photographs show that there had been an expansion of the structures on the Land in around 1972, which is consistent with the MOT and Madam Hung’s claim that she had been rebuilding the structure around the Land at that time. This is also consistent with the permission given by the authorities to allow her to use “sand” which was mentioned in the MOT. I notice all these had happened many years before the defendant purchased the Land from the manager of The Tso and is something not disputed and cannot be disputed by the defendant.

24.Hence, at the closing of the evidence, it was clear that the only factual issues which need to be resolved by the court including the following only:-

(a) whether or not Madam Hung had paid rent to the Tso and/or the defendant and/or Ms Li, his daughter; and

(b) whether the plaintiff had been living on the Land continuously since when he was young, or only had done so after Madam Hung had passed away in 2008.

The law

Adverse possession

25.The Court of Appeal has summarised the law on adverse possession in Shine Empire Ltd v Incorporated Owners of San Po Kong Mansion [2006] 4 HKC 288. Yuen JA held that:-

“28. The House of Lords in Pye has said that whilst the term “adverse possession” should be avoided as no intention of hostility to the paper title owner is required (paras. 36, 69), it is still necessary for the party (“the squatter”) claiming that it has dispossessed the paper title owner to prove two separate elements: (1) a sufficient degree of factual possession in the sense of physical control, and (2) an intention to possess. To establish factual possession, the squatter has to show absence of the paper title owner’s consent, a single and exclusive possession and such acts as demonstrated that in the circumstances, in particular, the nature of the land and the way it was commonly used, it had dealt with it as an occupying owner might normally be expected to do and that no other person had done so (para 41). To establish an intention to possess, the squatter has to show that he intended to occupy and use the land as his own (para 71), to exclude the world at large, including the paper title owner, so far as was reasonably possible (para 43).”

26.Lord Hope of Craighead explained the word “adverse” in the J A Pye (Oxford) Ltd & Anor v Graham & Anor [2003] 1 AC 419:-

“It is plainly of some importance, both now and for the future, to understand what the use of the word “adverse” in the context of section 15 of the Limitation Act 1980 was intended to convey. At first sight, it might be thought that the word “adverse” describes the nature of the possession that the squatter needs to demonstrate. It suggests that an element of aggression, hostility or subterfuge is required. But an examination of the context makes it clear that this is not so. It is used as a convenient label only, in recognition simply of the fact that the possession is adverse to the interests of the paper owner or, in the case of registered land, of the registered proprietor. The context is that of a person bringing an action to recover land who has been in possession of land but has been dispossessed or has discontinued his possession: paragraph 8 of Schedule 1 to the 1980 Act. His right of action is treated as accruing as soon as the land is in the possession of some other person in whose favour the limitation period can run. In that sense, and for that purpose, the other person’s possession is adverse to his. But the question whether that other person is in fact in possession of the land is a separate question on which the word “adverse” casts no light.”

27.In Wong Tak Yue v Kung Kwok Wai David [1998] 1 HKC 1, Li CJ explained the meaning of intention to possess:-

“38. The requisite intention to possess has been referred in various authorities under its Latin tag “animus possidendi”. I shall refer to it simply as the intention to possess. As Slade J observed in Powell v McFarlane at 471-472, the intention to possess requisite for adverse possession

“involves the intention, in one’s own name and on one’s own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the process of the law will allow.”

39. The question of intention to possess, as with any other question of intention, is one of fact. Whether it can be established depends on an assessment of all the circumstances in a particular case.

40. Where the occupier has made self-serving statements as to what was his intention, whether during the period of occupation or when challenged in legal proceedings, the courts should approach them with some scepticism. The courts would scrutinize the circumstances in which they were made and would give them such weight if any as they may deserve. Conversely, where the occupier has made statements as to what was his intention and such statements are against his interest, the courts would usually accord to them considerable weight.”

28.I agree with Mr Tony Ko, the plaintiff’s counsel, that, as a matter of law, the fact that Madam Hung had erroneously believed that she was the rightful owner of the Land does not contradict the plaintiff’s claim for adverse possession. See for example:

a) In Wong Kar Sue & Ors v Sun Hung Kai Properties Ltd & Anor [2006] 2 HKC 600, Deputy High Court Judge Muttrie considered the previous authorities and held that:-

“6. Ngo Sau Tak was a squatter, although she mistakenly believed that she was the owner of the Property. Her belief does not affect her position. In Hughes v Cork (Eng CA, Civil Division, 14 February 1994, unreported), the English Court of Appeal held that a person can still acquire title by adverse possession even though he believes himself to be the true owner. See also Wong Luen Chun v Secretary for Justice [1998] 4 HKC 122 at page 129C-I.” (emphasis added)

b) In Topwell Corp Ltd v Kwan Kam Kee [2014] 5 HKLRD 1, giving the judgment of the Court of Appeal, Kwan JA held at §24:-

“…A squatter may still validly establish a claim of adverse possession even though he had acted in the honest but mistaken belief that the subject property was in fact his …”

c) In Cheung Kwong Yuen v Sun Hui Fang [2016] 1 HKLRD 464, Kwan JA held at §11:-

“Whether a squatter could establish factual possession and the requisite intention for the purpose of adverse possession is a question of fact depending on the circumstances of the case. There is no rule of law that these elements cannot be established for a person who mistakenly believes that he has good title or that he is a lawful tenant and does not realise he is trespassing on another’s land.”

Enclosure of the Land

29.Enclosure and fencing of the Land is a prima facie indication that the squatter possessed the animus possidendi. In Buckinghamshire County Council v Moran [1990] 1 Ch 623 at 641E-642B, Slade LJ held that:-

“However, as the judge said, the more difficult question is whether the defendant had the necessary animus possidendi. As to this, Mr. Douglas accepted the correctness of the following statement (so far as it went) which I made in Powell v. McFarlane, 38 P. & C.R. 452, 471-472: “the animus possidendi involves the intention, in one’s own name and on one's own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the process of the law will allow.” At least at first sight the following observations of Lord Halsbury L.C. in Marshall v. Taylor [1895] 1 Ch. 641, 645, which were referred to by Hoffmann J. in his judgment, are very pertinent to the present case:

“The true nature of this particular strip of land is that it is enclosed. It cannot be denied that the person who now says he owns it could not get to it in any ordinary way. I do not deny that he could have crept through the hedge, or, if it had been a brick wall, that he could have climbed over the wall; but that was not the ordinary and usual mode of access. That is the exclusion - the dispossession - which seems to me to be so important in this case.”

As a number of authorities indicate, enclosure by itself prima facie indicates the requisite animus possidendi. As Cockburn C.J. said in Seddon v. Smith (1877) 36 L.T. 168, 169: “Enclosure is the strongest possible evidence of adverse possession.” Russell L.J. in George Wimpey & Co. Ltd. v. Sohn [1967] Ch. 487, 511A, similarly observed: “Ordinarily, of course, enclosure is the most cogent evidence of adverse possession and of dispossession of the true owner.” While Mr. Douglas pointed out that the plot was always accessible from the north where no boundary demarcation existed, it was only accessible from the defendant's own property, Dolphin Place. In my judgment, therefore, he must be treated as having enclosed it.” (emphasis added)

30.I accept in this case there is ample evidence to show that the plaintiff and Madam Hung have had the requisite animus possidendi in respect of the Land by enclosing it at an early stage of their occupation.

31.Madam Hung stated in her affidavit that the Land “…has been fenced up since the date of occupation. It is fenced up with iron wire which is supported by a short brick wall and the external walls of the buildings. Outsiders are prevented from entering the Subject Land without my permission.”.

32.While there are not a lot of photographic evidence to show the fencing and external walls around the Land (there are only a couple of photos showing the low brick wall and the metal wire fences), I accept Madam Hung’s evidence as stated in her affidavit and the oral evidence of the plaintiff and her siblings on this. I shall comment on this further under the analysis of the evidence below.

The modification of tenancy

33.The defendant has pleaded “…by reason of the Modification of Tenancy granted by the District Office, the Plaintiff’s mother was the Tso’s tenant/licensee/permitee and she acknowledged the Tso’s title to the Land”.

34.In Yu Kit Chiu v Chan Shek Woo, CACV 137/2010 (unreported, 18 February 2011, Cheung JA, Yuen JA and Fung J), the Court of Appeal considered the impact of a modification of tenancy in the context of adverse possession proceedings. The squatter in that case signed a modification of tenancy where it explicitly stated “on behalf of registered land owner”. The Court of Appeal considered that the squatter was unable to establish animus possidendi in which Cheung JA held at §44:-

“ 44. While bearing in mind the backdrop of the case which happened in rural New Territories in 1970 and Mr. Chan was a man of humble background, the law is that a man is taken to understand what he had signed. Because of his infirmity, Mr. Chan was unable to give evidence on his understanding of the MOT he signed in 1970. On that basis it has to be taken that he understood the contents of the MOT and that he signed it on behalf of the deceased. In Powell, Slade J held that where the trespasser’s use of land was equivocal, the onus is on him to ‘adduce compelling evidence’ that he had the requisite intention to possess (see p. 476). The document spelt out that in consideration of the deceased paying the requisite fee, the head lessor modified the Crown Lease by allowing him to maintain the structures on the land. After due consideration, I agree with the Judge’s analysis of the position. I am of the view that the signature of Mr. Chan on behalf of the deceased did not merely acknowledge the deceased’s ownership of the land but was also an acknowledgment of the deceased’s possession of the land. The erection of four structures on the land together with their use clearly were matters concerning possession of the land and not simply ownership. The head lessor’s permission to allow the four structures to be maintained continuously was also related to the issue of possession because they related to how the land was to be used and not merely ownership of the land. By acknowledging that he agreed to the terms of the modification on behalf of the deceased, Mr.Chan was acknowledging that he was possessing the land on behalf of the deceased and not to his exclusion. In my view Mr. Chan was not able to establish that he had the intention to possess the land in 1970 or thereafter when he had since 1970 paid the permit fees continuously. He did so even up to 2005 which was even after the plaintiffs had commenced proceedings against him.” (emphasis added)

35.In Fong Kam Mui v HSBC Private Trustee (Hong Kong) Limited, HCA 2264/2014 (unreported, 26 February 2019), Deputy High Court Judge Maurellet SC explained the relevance of a modification of tenancy in adverse possession proceedings.

36.The learned deputy judge acknowledged the Court of Appeal’s obiter in Yu Kit Chiu, supra, but emphasised, inter alia, that the Court must still consider all the evidence in assessing whether or not the squatter had the requisite animus possidendi:-

“72. I agree with Mr Chan that the Court of Appeal’s dicta only go so far as to hold that, unsurprisingly, where a squatter has recognized (in writing and in a MOT in the case before it) the owner being the paper title owner he could not be heard to have shown any animus possidendi.

73. The focus of the Court was on whether the act of the squatter (signing the MOT ‘on behalf of the registered owner’) amounted to an “acknowledgment of [the paper title owner’s] possession of the land”. In other words whether by his conduct the squatter “was acknowledging that he was possessing the land on behalf of the [paper owner] and not to his exclusion”.

…

77. I agree with Mr Chan that these authorities do not support the proposition that in every case where Y signs a MOT ‘for and on behalf of X the paper owner’, if Z renews and pays for the said MOT, then he would always be found to have lacked animus possidendi for that reason alone. Yu Kit Chiu is authority for the proposition that Y cannot show animus, not that Z can never do so.

78. Ultimately the Court in conducting this exercise has to consider all the evidence probative of intention, direct and indirect, and then consider if a squatter has discharged his burden of showing that his acts are not open to more than one interpretation and that he has made it perfectly plain to the world at large that he had intended to exclude the owner as best he can.” [emphasis added]

37.The plaintiff submits the existence of the MOT is not fatal to his claim for adverse possession. I agree with this proposition as a matter of law. Again, I shall deal with this matter further under the passage below where I shall discuss the evidence given by the parties during the trial.

The Limitation Period Issue

38.It is not dispute that the Limitation Ordinance prior to 1991 required a period of 20 years for adverse possession. Under s7 of the Limitation Ordinance prior to 1991, it provides that:-

“(2) No action shall be brought by any other person to recover any land after the expiration of 20 years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person:

Provided that, if the right of action first accrued to the Crown through whom the person bringing the action claims, the action may be brought at any time before the expiration of the period during which the action could have been brought by the Crown, or of 20 years from the date on which the right of action accrued to some person other than the Crown, whichever period first expires.”

39.Moreover, under s17 of the Limitation Ordinance, it provides that:-

“Subject to the provisions of section 10, at the expiration of the period prescribed by this Ordinance for any person to bring an action to recover land (including a redemption action), the title of that person to the land shall be extinguished.”

40.The plaintiff’s case is that the plaintiff’s mother Madam Hung had been in continuous exclusive possession of the Land since 1961 until her passing in 2011. By the time when the MP Action was commenced against her in 2008, The Tso’s title (and the defendant’s title) had already been extinguished. The Plaintiff has, since the death of his mother, been in continuous adverse possession, as a successive squatter. Thus, there was never any break from the physical occupation (as well as the intention to possess) by Madam Hung since 1961 and then by her son the plaintiff herein thereafter.

41.The plaintiff is entitled to rely on aggregating the period of possession with Madam Hung. In Cheung Yat Fuk v Tang Tak Hong & Ors [2004] 2 HKLRD 86, Bokhary PJ held that-

“4. There is no difficulty in aggregating the period of possession by the 1st respondent personally and the period of possession by him through his tenant. The legal position was neatly expressed in Shelmerdine v Ringen Pty Ltd [1993] 1 VR 315, a decision of the Supreme Court of Victoria (Appeal Division) cited by Mr Gerard McCoy SC for the respondents. There Brooking J said (at p.341) that “where the adverse possession has been continuous, it is possible to tack the possession of one intruder on to that of another although there has been no assignment of possessory rights.”

42.In Ricas Properties Limited v Armed Forces Trading Co Ltd & Ors, DCMP 75/2008 (unreported, 8 November 2010), District Judge Simon Leung held, at §14 that:-

“It is common ground that it is possible for a person to acquire the interest as an adverse possessor himself by way of succeeding the previous adverse possessor as a squatter in the land: see Ng Lai Sim v Lam Yip Shing & Anor, HCA 2963/1998 (22 November 1999). The court in the O.113 decision in the present case in August 2008 came to a similar tentative conclusion on the applicable law: see paras.16-26 thereof...”

43.In Ng Lai Sim v Lam Yip Shing & Anor, HCA 2963/1998 (unreported, 22 November 1999) at § 22, Cheung J (as he then was) stated that:-

“… the fact that the Plaintiff was not in possession from 1977 to 1995 is not fatal to her claim. Because the law is clear that the second squatter can add the period of possession of the first squatter to her own period of possession in order to complete the period of possession : Megarry & Wade at page 1036.”

44.According to the joint survey report prepared by Leung Shou Chun Land Surveying Consultants (“the Expert Report”), the following is stated at the conclusion:-

“…the group of temporary structures occupied the northeastern portion of lot 647 for a continuous period of 49 years. While this group of temporary structure started with a slightly lesser extent in the first 18 years, it occupied to the full extent as nowadays for the later 31 years since 1979.” (emphasis added)

45.Moreover, according to the Expert Report, the following observations were made from aerial photographs dated 26 October 1961:-

“A group of temporary structures observed at the northeastern corner of lot 647. However, the size of (sic) was only ¾ of the existing temporary structures nowadays. No front yard area was observed at the south of temporary structures, instead, the temporary structures was surrounded by cultivation field.”

46.The Expert Report made the following observations from aerial photographs dated 29 October 1973:-

“The group of temporary structures was expanded to the same size of nowadays. No front yard area was observed at the south of temporary structures.” (emphasis added)

Extinguishment of the defendant’s title

47.As a matter of law, the plaintiff says that if he can establish the above issues by evidence, the title to the Land of the defendant and/or the defendant’s predecessors would have been extinguished under ss7, 17, and 38A of the Limitation Ordinance.

The Evidence

Credibility of the witnesses

48.Before I go into the details of the evidence given by the parties’ witnesses at the trial, I would like to comment generally about their credibility and my overall impression of them.

The plaintiff and his witnesses

49.The plaintiff gave evidence himself at the trial as PW1. He came across to me as a direct, straightforward and honest witness. In my view, his evidence is entirely consistent with the contemporaneous documents and the photographic evidence produced by the parties. Most importantly, I consider his case is inherently probable and totally consistent with the overall picture both in terms of the history and the current use of the Land.

50.I am equally impressed by the evidence of the plaintiff’s elder brother, Shun Fan who was PW2 in this case. Again, I find his evidence to be entirely believable despite the very lengthy and detailed cross-examination by the defendant’s counsel. In my view, Shun Fan was able to relate his evidence in a cogent and creditable manner. I accept his evidence without any reservation at all.

51.Similar comments can be made of Kit Wah (PW3)’s evidence. She is the eldest sister amongst the siblings. In fact, I find her to be a most honest and truthful witness who gave her evidence in a firm and creditable manner. I have no reason to doubt any part of the evidence given by her in court.

52.Equally impressive was the evidence given by the plaintiff’s elder sister, Ching Wah who was PW4 in the case. She was able to give her evidence again in a firm, no nonsense and matter of fact manner with no exaggeration and embellishment.

Evidence of the defendant and his witnesses

53.The defendant himself gave evidence at the trial as did his daughter Ms Li who assists the defendant in running his real estate business and the lands he owns in the New Territories, including the Land in question. Further, a villager who lives in the same village as the plaintiff by the name of Madam Leung Sui Wah (梁瑞華) (“Madam Leung”) was called to give evidence on the defendant’s behalf as DW3 in the case.

54.In my view, none of the defendant’s 3 witnesses was believable as their oral evidence were in direct conflict with the documentary evidence produced by the parties in this case. Further, perhaps more significantly, it is clear that in some of the material aspects of this case, both the defendant and Ms Li had no direct knowledge of them. They only relied on what other villagers had told them and in particular the managers of The Tso who had sold the defendant the Land in the first place. Obviously, the managers of The Tso would not have told the defendant that a family had been adversely possessing the Land since 1962 when they sold the Land to the defendant. Ms Li’s evidence is equally unreliable because a lot of what she said in her evidence simply are not inherently probable and not consistent with the documents produced by the plaintiff and his family members. Perhaps the most incredible and unbelievable witness on the defendant’s side is Madam Leung whose evidence is simply full of conjectures and inconsistencies. There is simply without any ring of truth around it.

55.Hence, where there are any differences in the evidence given by the parties’ witnesses, I would prefer the evidence given by the plaintiff and his siblings rather than those given by the defendant and his witnesses.

56.I will now deal with the evidence under the different issues in the following passages.

Evidence of factual possession

57.The plaintiff stated in his witness statement that “(A)fter the death of my Mother on 4^th January 2011, I have become in continuous exclusive possession of the Land.”

58.Further, the plaintiff stated that he had “…made an opening for my [his] sole use to the exclusion of others in installing a metal gate at the opening as a backdoor. I [plaintiff] have also repaired and maintained the temporary structures with metal plates over the years” on the Land.

59.I accept the above evidence of the plaintiff.

60.The aerial photographs and other documents produced by the plaintiff and his siblings also categorically refute any suggestion of the defendant that the plaintiff and his family had not been in factual possession of the Land on a continuous basis since or around 1962.

61.In Madam Leung’s witness statement, she stated that the plaintiff’s mother complained bitterly that after the plaintiff had moved out from the Land, the plaintiff rarely visited Madam Hung and that she felt very lonely.

62.I do not accept Madam Leung’s evidence on this matter as her evidence in this regard is hearsay and also contradicts the contents of Madam Hung’s affidavit. More importantly, it is in direct conflict of the evidence of the plaintiff and his siblings who had given evidence at the trial. They all stated that their family enjoyed a close relationship and had regular family meetings and dinners on the Land, particularly during different Chinese festivals, while their mother was still alive. They appeared to me as being such a close-knitted family.

63.Madam Leung further stated that her house (which is situated at No 54, Kwan Ti East Village) was 300 metres away from the Land where the plaintiff’s mother resided. She claimed that her residence had a pool for turtles which faced the Land. When Madam Leung was taking care of the turtles, she claimed to be able to see whether or not the plaintiff’s residence had turned on the lights or not.

64.I find such evidence to be rather incredible. First, it is doubtful whether Madam Leung could see that well with a 300 metres distance. Also it is doubtful whether she could properly observe the lights at Madam Hung’s residence when the houses were not directly facing each other. Further, whether Madam Hung would turn on her lights or not in the evening was a matter of choice. She might prefer to save electricity by turning off most lights which is not unusual amongst the older generation. Thus, I do not find whether Madam Hung had turned on the lights inside her house in the evening is a material piece of evidence to determine the occupation issue in this case.

65.An even more absurd claim that Madam Leung made was that she had heard that Madam Hung’s body was only discovered by others in her house a few days after she had passed away (“招師奶約於2011年過世, 當時沒有人知道她離世了。聽說是她在家過世幾天後才有人發現。”). Judging from the evidence of the plaintiff and his siblings and the close relationship which existed amongst the family members, I agree with the plaintiff’s counsel that such unfounded, biased and hearsay evidence based on rumours and gossips has no place in the solemn setting of a court room. I have no hesitation in rejecting Madam Leung’s evidence in this respect as in other aspects of her evidence.

Rental payment issue

(i) Whether Madam Hung had paid rent or fees to The Tso and/or the defendant

66.The plaintiff pleaded that neither his mother Madam Hung nor the plaintiff’s father had ever paid any rent to the defendant and/or his predecessors-in-title and/or to anyone for the use, possession, occupation and control of the Land.

67.In this regard, Madam Hung stated in her affidavit that none of the Yeung’s family (including his descendants) have ever requested her to pay rent or denied her entitlement to use the Land. She stated that even if she was demanded to pay rent, she would raise an objection since she did pay HK$1,000 to purchase the Land in 1961.

68.The defendant has pleaded that Madam Hung and/or the plaintiff’s father had paid rent or license fee to The Tso. The defendant stated in his witness statement that Madam Hung had paid a “symbolic rent” to him. The defendant further stated that his daughter, Ms Li, told him that Madam Hung had attempted to pay a rent of HK$100 to her. The defendant said out of sympathy to Madam Hung, he did not increase her rent and had arranged Ms Li to accept the “symbolic rent” from her.

69.However, I notice that the defendant has not been able to adduce a single piece of document to show that Madam Hung had paid any of the alleged “symbolic rent” to him or his daughter. In my judgment, it speaks volume as to the genuineness of that allegation. Even though the defendant has purchased the Land from The Tso as early as in 1997, he has not been able to adduce a single piece of written evidence to prove that Madam Hung had in fact paid the defendant and/or Ms Li any rent/licence fee over the years at all.

70.In my judgment, the defendant’s case that Madam Hung had paid rent to The Tso and/or to him and/or to his daughter Ms Li is clearly something that they have made up and not at all believable. This can be shown in several matters highlighted by Mr Ko, the plaintiff’s counsel, in his submission. They included:-

(a) A letter from Messrs Wong, Fung & Co, the former solicitors for the defendant dated 19 June 2008 which stated unequivocally that Madam Hung was occupying the Land “…without any permission, prior consent or license or approval…” of the defendant thereby amounting to trespass[3]. In the letter, it did not mention about Madam Hung’s failure to pay rent to the defendant and/or any unauthorized building works on the Land as now mentioned by Ms Li. During the cross-examination, both the defendant and Ms Li had not provided any satisfactory explanation as to the inconsistent stance over the matter.

(b) In Ms Li’s affirmation prepared in support of the MP action, she has not raised the allegation that Madam Hung had failed to pay any rent to her father. To the contrary, Ms Li stated that “(T)he identity(ies) or name(s) of the person(s) in wrongful occupation of the said Land is/are unknown to the Plaintiff or me … I was told by the Plaintiff and verily believe that neither the Plaintiff himself nor any other person on behalf of the plaintiff have ever granted or given any tenancy, licence, consent, permission or approval, whether expressed or implied, to the Defendant at any time to enter into or remain in occupation of the said Land or any part of thereof ”. [emphasis added]

(c) Given the above specific and unequivocal allegations made under oath, there is little room for doubt of what she said, namely, her father had never granted a tenancy to Madam Hung at any time. Therefore, the issue of paying rent to either the Tso or to her father has never been an issue until recently. Ms Li failed to explain in her evidence as to why there was such a glaring inconsistency between the affirmation she had prepared in December 2008 and the evidence she gave under oath during the trial. Giving the education background of Ms Li (who is a university graduate and had spent 9 years studying in the UK), there is no doubt in my mind that she understood the contents and the significance of her affirmation (which was written in English and prepared by her father’s then lawyers on her behalf at the time). To come to court to say something that is the exact opposite under oath can only lead me to come to one conclusion that her evidence is not trustworthy and cannot be relied upon.

(d) I further reject Ms Li’s explanation given in court that at the time she was more concerned about the alleged illegal structure built on the Land (which incidentally is not in issue mentioned and/or referred to in any of the witness statement or affirmation of Ms Li) and therefore she was not paying attention to whether Madam Hung was paying rent on time or not. To me, it is quite clear that this had never been a matter of concern to either Ms Li or the defendant at all prior to the commencement of the CJ action by the plaintiff. This issue of paying rent only appeared after adverse possession was claimed by the plaintiff and his family. In my judgment, there is no doubt that this part of her evidence could not be true at all.

(e) I accept Mr Ko’s submission that if Madam Hung was indeed a tenant of the Land and had paid rent to the Tso, it begs the obvious question of why she was not identified under Clause 28 of the sale and purchase agreement dated 24 May 1997 between The Tso and the defendant. In fact, under Clause 28, it was expressly stated that the property was sold subject to the existing tenancy agreement(s), with the names of the tenants, namely, 駱常歡 and 何潔儀 for that tenancy and the rent of “950 catties of grain per annum”. If indeed Madam Hung and her family had rent the Land from The Tso before the defendant acquired the Land, I find it most surprising that her name was not mentioned amongst the tenants stated in the sale and purchase agreement. Significantly, neither the defendant nor Ms Li was able to provide a plausible explanation for this glaring omission in the sale and purchase agreement.

(f) Further, Mr Yeung Chung Wing (楊春榮) who was one of the 3 managers of The Tso at the time, made an affirmation in the MP Action back in May 2009 stating that he had never heard of Madam Hung from the previous managers at all. Further, he stated that the previous manager, namely Yeung Wan Ching, who was responsible for managing the Land, had never heard of Madam Hung’s occupation of the Land. In the premises, when even the managers of The Tso had not heard of Madam Hung’s occupation, letting alone paying rent to them, it begs the question of how the defendant would know about such fact as he had only acquired the Land in 1997 only.

(g) Most importantly perhaps is the fact that neither the defendant nor any of his witnesses could be able to produce a single piece of documentary evidence to show that Madam Hung had in fact paid rent to The Tso and/or to him when there were other documents like the sale and purchase agreement had made specific reference to other tenants who paid rent to The Tso.

(h) I also agree with Mr Ko’s submission that it is not whether the plaintiff himself was in actual factual possession of the Land (from 2008 to 2011) which is a decisive issue in this case. It is the fact that Madam Hung had factual possession and the intention to possess (animus possidendi) of the Land for the requisite 20 years under the Limitation Ordinance, Cap 347 that matters. Once the plaintiff is able to show to the court that his mother Madam Hung had factual possession and as well as the intention of possessing of the Land for the period required under the Limitation Ordinance, when The Tso’s title over the Land would have been extinguished by virtue s 17 of the Limitation Ordinance. Then, the defendant as the owner of the Land could not have make the claim on his then predecessor-in-title could evict Madam Hung or her children including the plaintiff who had been in continuous occupation of the Land.

(b) Whether the plaintiff was in factual possession of the Land after the death of Madam Hung in 2011?

71.In my judgment, the evidence on this issue is overwhelming. The plaintiff and all of his siblings who had come to court to give evidence spoke on this matter. As said, I found them to be honest and credible witnesses. Their evidence is beyond reproach. In fact, I find it surprising that the defendant and his lawyers chose to attack the plaintiff’s case in this respect when the all over evidence was firmly supported by the indisputable contemporaneous documentary evidence which existed at the time when the plaintiff and his siblings were young who were living on the Land. They included documents like primary student’s handbooks, official letters from universities or authorities, university registration documents and utility bills.

72.For example, Kit Wah (PW3 in this case), who is the eldest sister of the plaintiff and second daughter of Madam Hung, gave clear and indisputable evidence on how she and her family had stayed on the Land since they were young. Kit Wah, a well educated lady who possesses a master degree in counselling and education and works as a full-time pastor in a church, stated firmly and clearly in her evidence that her brother, ie the plaintiff, has lived in the house built and expanded by their parents since he was born. Furthermore, during a short period from 1991 to 1993, after her first daughter was born, Kit Wah had also lived in the family home on the Land so that her mother Madam Hung could look after her daughter while she was at work. Kit Wah testified to the fact that the plaintiff had all along lived in the family home both before and after he got married. Even after he had separated from his wife in around 1992, Chiu continued to live on the Land and in the house built by his parents. He also continues to work as a cross border container truck driver.

73.I find her above evidence to be wholly believable and true.

74.In response to a question from the court, Kit Wah stated that the plaintiff had lived with his whole family of 4 in the family home before he separated from his wife when his wife moved out with the 2 daughters. However, due to the nature of his job, he sometimes had to drive his truck to Shenzhen and spent the night over there. This happened about 2 to 3 times in a month. But he would always drive back to Hong Kong the next day and would return to live and stay in the house. Kit Wah was also able to testify that the plaintiff’s 2 daughters had moved back to live with him when they were at Primary 2 and 3. The daughters had lived on the Land until they studied at secondary school. So the daughters were about 8 to 10 years old when they moved back there until they graduated from secondary school.

75.Regarding the MOT, Kit Wah in my opinion has honestly stated that she had never seen the document before nor did her late mother Madam Hung had ever explained the contents to her. I consider that she was completely honest when she said that she had never asked her mother of why she could expand of the structure they lived in on the Land as they were only “kids” at the time. However, she understood that the reason for the expansion of the structures on the Land in the 1970s was that the family could have more living space. In my opinion, that is a perfectly reasonable and plausible explanation. I also find her to be very honest when she said that she did not know if her late mother Madam Hung had applied to the authority to have the structures expanded as she was only studying at primary level at the time and did not have such concepts.

76.I also accept her evidence when she said that she had never heard from her late mother the fact that she had to pay rent to The Tso or to the defendant or his family for the occupation of the Land and/or the structures built on it. It was only in 2008.

On the MOT issue

77.First of all, in my judgment, the facts of the present case are distinguishable from Yu Kit Chiu, supra. In that case, the squatter signed on the modification of tenancy “on behalf of registered land owner”, yet there is no such express wording in the MOT signed by Madam Hung. Consequently, Madam Hung did not acknowledge that she was signing the MOT on behalf of the registered paper title owner.

78.Second, when Madam Hung signed the MOT, she was acting with the intention of applying permission to conduct activities in order to repair the wooden hut on the Land. In other words, Madam Hung did not show an intention that she was acknowledging the title of Yeung Man or indeed The Tso’s title.

79.Third, there is no evidence to suggest that Madam Hung who was illiterate had filled out the MOT herself. Conversely, it is Madam Hung’s evidence that Yeung Man had assisted her in writing a letter to the Tai Po District Officer. The reason was that villagers would seek assistance from people in the village who were influential and familiar with government officials so as to facilitate the approval of the application to repair the wooden hut on the Land.

80.Fourth, even if (which is denied) the MOT dated 13 June 1972 did break the continuality of adverse possession, the limitation period would simply start afresh on 13 June 1972.

81.Under s23(1) Limitation Ordinance, it states clearly that an acknowledgement of the paper title owner would restart the time period:-

“(1)Where there has accrued any right of action (including a foreclosure action) to recover land or any right of a mortgagee of personal property to bring a foreclosure action in respect of the property, and—

(a) the person in possession of the land or personal property acknowledges the title of the person to whom the right of action has accrued; or

(b)in the case of a foreclosure or other action by a mortgagee, the person in possession as aforesaid or the person liable for the mortgage debt makes any payment in respect thereof, whether of principal or interest,

the right shall be deemed to have accrued on and not before the date of the acknowledgment or payment.” (emphasis added)

82.There is no other evidence to suggest that Madam Hung had signed another MOT whereby she acknowledged The Tso’s title. As such, Madam Hung would still have fulfilled the requisite 20 years from 13 June 1972 till 13 June 1992 for the purpose of adverse possession.

83.Fifth, the MOT was printed on both sides, while the English side referred to The Tso being the registered owner, the Chinese side does not contain such a reference.

84.Accordingly, I find the MOT had not in any way affected the requisite animus possidendi for adverse possession of the Land demonstrated by Madam Hung.

CONCLUSION

Orders

85.By reason of the above discussions and findings made, I find the title of the defendant and/or his predecessors of the Land has been extinguished under ss7, 17 and 38A of the Limitation Ordinance.

86.Further, I make a declaration that the defendant’s title to the Land has been extinguished.

87.I further make a declaration that the plaintiff has acquired a good possessory title to the Land, and that all rights, title and interests including the ownership and right to exclusive possession and occupation of the Land be vested in the plaintiff.

88.Hence, judgment will be entered in favour of the plaintiff in the above terms in the CJ Action accordingly.

89.The defendant’s counterclaim in the CJ Action is hereby dismissed.

90.Likewise, the defendant’s claim under the MP Action be dismissed.

Costs

91.Costs should follow the event.

92.I make an order nisi that the defendant do pay the costs of the plaintiff in both the CJ Action and the MP Action, such costs should be taxed if not agreed at the District Court scale on a party and party basis with certificate for counsel. The plaintiff’s own costs to be taxed in accordance with the Legal Aid Regulations.

93.Should any party wish to vary the above costs order, they should apply within 14 days from the date of handing down of the judgment. Otherwise, the costs order will become absolute.

94.It remains for me to thank counsel for their assistance in this case.

Mr Tony Ko instructed by Chiu Szeto & Cheng for the plaintiff

Mr PC Au, instructed by Wai & Co., Solicitors for the defendants