Wu Kai Wai and Others v. Occupants of Lot No. 316 in D.D. 128, Yuen Long, New Territories and Another
Read the full judgment text of DCCJ 3740/2017 on BabelCite. This District Court judgment was delivered on 21 December 2021.
1. The plaintiffs are registered owners of Lot No 316 in DD 128, Yeun Long, New Territories (“the Lot”) and are seeking vacant possession and mense profits / rent in arrears. The 2 nd defendant claims adverse possession. The 1 st defendant did not participate in the proceedings.
Cites 4 cases
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DCCJ 3740/2017 [2021] HKDC 1538 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION CIVIL ACTION NO 3740 OF 2017 ------------------------------------
------------------------------------ Before: His Honour Judge Harold Leong in Court Date of Hearing: 13-14 September 2021 Date of Judgment: 21 December 2021 ------------------------------ JUDGMENT ------------------------------ 1.The plaintiffs are registered owners of Lot No 316 in DD 128, Yeun Long, New Territories (“the Lot”) and are seeking vacant possession and mense profits / rent in arrears. The 2nd defendant claims adverse possession. The 1st defendant did not participate in the proceedings. Legal principles 2.This is trite: the adverse possessor must show both continuous factual possession and animus possidendi for a period of 12 years before the issue of the writ (putting that as no later than 2005). 3.The person claiming adverse possession carries the burden of proof. Although the standard of proof is still the normal civil standard, the evidence of exclusive possession and intention must be compelling (Tsang Foo Keung v Chu Jim Mi Jimmy [2017] 3 HKC 527). The onus to be discharged by the squatter is a heavy one, in that evidence to be adduced must be clear and compelling (Wu Yee Pak v Un Fong Leung & Others (2004) 7 HKCFAR 498). 4.If a person takes possession by virtue of a licence granted by another, it is the licensor who is treated in possession. 5.There is no dispute between the parties on such legal principles. The 2nd defendant’s case 6.The 2nd defendant claims that his father has built a little house and had been using the Lot and surrounding land to farm and raise chickens and pigs since mid to late 1960s. His father never obtained any permission from anyone nor paid any rent with regard to the Lot. 7.In 1994, his father stopped farming and raising animals, and gave the little house, Lot 316 and various lands near it to the 2nd defendant. 8.The most important evidence on how the 2nd defendant managed these lands is stated in paragraph 10 to 12 of his witness statement, which I translate as follows (Trial Bundle page 77):-
9.The 2nd defendant claimed that all along, he never obtained any permission from anyone or pay any rent on the Lot. He had the intention to treat the Lot as his own ever since he possessed it. 10.It was only in around 2013 to 2014 that his tenant told him that “two brothers came to the Lot and claim that this was their land and it was illegally occupied with illegal structures.” The tenant gave the 2nd defendant’s contact to those people and they have called him seeking vacant possession or rent. The 2nd defendant ignored them. The disputes continued and the current claim commenced. 11.The 2nd defendant only called himself to be the witness. He did not call his father nor the tenant to give evidence. Structures on the Lot 12.As stated in the 2nd defendant’s witness statement, the chronology of the 2nd defendant’s management of the Lot is as follows:-
13.At the trial, the 2nd defendant claimed further that he had 2 consecutive tenancies: the first tenant rented from 1994 to 1998, and the second tenant from 1998 to 2017. After that, he was occupying the Lot himself for his own use. 14.From the aerial photographs around 1994, two Temporary Structures which encroached on the south end of the Lot can be seen (1994 aerial photograph: Trial Bundle page 170 taken in 1994; 1995 aerial photograph: Trial Bundle page 171). 15.I will define these encroachments of the Lot as the “Southern Portion” and the remainder of the Lot as the “Northern Portion”. 16.The 2nd defendant identified in court these temporary structures as the chicken and pig sheds that his father had built. He confirmed that the temporary structure on the west side identified as “S2” by the survey experts in the joint expert report was the chicken shed, and the temporary structure on east side identified as “S1” was the pig shed (paragraph 6.2.1, Trial Bundle page 225 and Appendix 4, Trial Bundle page 233). 17.I note that S1 only marginally encroached on the Lot while S2 made a more substantial encroachment. 18.The 2nd defendant also clarified in court that he and his father lived in two separate huts which are outside the Lot. 19.The little house mentioned in the witness statement which he had been living in was the square-shaped structure on the east side closest to “S1”. 20.S1 and S2 pre-existed for a long time before 1994 and were in fact documented in the Survey Sheet dated May 1989 (Trial Bundle page 109). But they likely existed from much earlier: from the aerial photos, S2 was visible even in the poor quality photo taken on 15 September 1979 (Trial Bundle page 142) and S1 could be seen in the photo taken on 19 October 1983 (Trial Bundle page 148) and perhaps could be seen clearer in the photo taken on 12 March 1985 (Trial Bundle page 152). Both structures can be very clearly seen in the (much better quality) aerial photo taken on 10 June 1987 (Trial Bundle page 156). 21.The 2nd defendant claimed in his witness statement that he started renting out the Lot after the warehouse was completed. He also gave evidence in court that he had first rented the Lot in 1994. 22.However, it is clear that in 1994, no warehouse was being built on the Lot. The only structures within the Lot (or encroaching on the Lot) was S1 and S2 and both were in the Southern Portion. 23.Both survey experts agreed that between 2008 to 2009: “Structures S1 and S2 remained on the Southern Portion”; and between 2010 to 2018: “The Northern Portion was used as an open storage and stacked with a container. It was erected with structures as found in aerial photos between 2013 and 2017…” (Trial Bundle page 264) 24.The experts are of the view that the only “new structure” on the Lot would be a container stack first seen in 2010, and “structures” were only first seen in 2013. This opinion can easily be confirmed by the aerial photos taken on 1 November 2010 (Trial Bundle page 202) and 30 June 2013 (Trial Bundle page 208) 25.If the 2nd defendant claimed that he had only rented the Lot out after building the warehouse, this clearly happened in no earlier than 2013. Even if we stretch the meaning of “building a warehouse on asphalt” to “placing containers on the ground”, the 2nd defendant would not have rented the Lot out earlier than 2010. 26.Under cross-examination, the 2nd defendant attempted to explain this discrepancy by suggesting that he had rented S1 and S2 out in 1994. Then he changed his story and claimed that the tenant originally wanted to rent the unpathed ground (that is, the Northern Portion) as well, but this was unpathed so they could not enter to use. 27.However, when paragraph 11 of his witness statement was put to him, the 2nd defendant further claimed that “it has taken me time to put down asphalt” but the tenant did look at the Lot (that is, the Northern Portion) and knew that it was unpathed but still wanted to rent it, and that when the tenant found that he could not use that, he did not complain at all. 28.The 2nd defendant also now claimed that when he said “warehouse”, he meant the whole area of the Lot: he treated the whole Lot as a “warehouse”. 29.This is inconsistent with paragraph 10 of his witness statement where he stated clearly that he was building a “warehouse” on top of the asphalt with the help of his father, as well as connecting water and electricity supply to the “warehouse”. What would he be building on top of the asphalt and connecting supplies to if the whole Lot is considered a “warehouse”? Vegetation 30.As the 2nd defendant now claimed that he has started putting down asphalt in 1994 but “it has taken him time”, he was questioned as to why the Northern Portion was overgrown as shown in the aerial photos of 1995 and 1996 (Trial Bundle page 172 and 174). 31.The 2nd defendant claimed that the trees and grasses were growing at an overtly high pace (evidently exceeding the pace of his work despite him attending to the Lot almost every day!) 32.There was another period from 2004 to 2006 when the aerial photos show that the Lot was again overgrown (Trial Bundle page 189 - 194). 33.The 2nd defendant then came up with an explanation that the Lot was covered by bamboo trees of “100 feet” tall, which formed a canopy covering the whole Lot (as seen in the aerial photographs), but use of the Lot for storage was still possible because the bamboos at root level only occupied the area of “half a size of a private car”. 34.When queried, the 2nd defendant “doubled-down” on the height of these bamboo trees: he claimed that this 100 feet height was correct because when he cut down the bamboos and sawed them into sections to be brought away, he knew how long each sections were. 35.By my estimation, “100 feet” is roughly the height of a 10-storey building, and a private motor car is about 5 metres long and 2 metres wide, so we are talking about an area of, say, 2 x 2.5 metre (or about 6 feet by 9 feet) which has sprouted such giant trees. 36.I note the Lot looked to be clear in 2002 (Trial Bundle page 186), so the 2nd defendant’s bamboo trees must have grown to 100 feet within 2 years. That would mean the bamboo trees were growing at 50 feet (or achieving the height of a 5 storey building) per year, all sprouting from a ground area of 6 x 9 feet! 37.I am no botanist but common sense dictate that if there is a species of bamboo in Hong Kong that can grow to such heights every single year, all of Hong Kong would have been overrun by giant bamboos decades ago. We might not be able to see the sky at all from any part of the city. 38.As to why he would allow such to happen on the Lot despite attending to it “almost every single day”, the 2nd defendant explained that the government was building a retaining wall on the northern part of the Lot and a government officer informed him orally (so there was no document in support) that he could not remove the bamboo trees. The 2nd defendant claimed that the aerial photo of 2009 showed the scaffolding for the work on the retaining wall on the north east corner of Lot 316 (Trial Bundle page 200). 39.What had the building a retaining wall at one corner of the Lot anything to do with giant trees growing in the middle was never explained by the 2nd defendant, but even if there was any sense to this, with such a warning from the government, why would the 2007 aerial photo showed a reduction of the vegetation overgrowth? 40.The 2nd defendant explained that a fire was started by workers accidentally, which burned down exactly half the bamboo trees because the firemen came in time. 41.Quite how a fire started in a bamboo forest with roots occupying an area of only 6 x 9 feet would destroy only half the trees in that area (that is 3 feet x 4.5 feet, perhaps the size of a small coffee table) without spreading further is beyond common sense. 42.It was then asked that if the retaining wall was only done in 2009 (and presumably that was the time he was asked by the government officer not to cut down the bamboos), why would he allow the bamboo forest to grow from 2004 to 2007 (when the “limited” fire happened)? 43.To this, the 2nd defendant gave an even more surreal explanation: he claimed that there were a lot of bee nests in the bamboo trees so he needed to wait 2 years until the bees left (presumably by way of a voluntary migration). 44.To summarise, this is what the 2nd defendant now claimed to have happened to explain the change in vegetation in the Lot between 2002 and 2009 as seen in the aerial photographs:-
45.Presumably, despite these huge problems of very fast growing grass, infestation of bees, giant bamboo trees, the accidental fire and the government warning etc., the tenant was still quite happy to continue to rent, and to patiently allow time for the 2nd defendant to wait for the bees to leave etc (instead of calling pest control and tree surgeons or the like to get rid of the problems). 46.And importantly, for all these monumental events that had happened on the Lot which would have provided very good evidence of the 2nd defendant’s factual possession since 1994 or at least 2002, none of such was mentioned in his witness statement. 47.I find all these explanations breathtakingly incredible. The 2nd defendant is clearly a dishonest witness willing to say anything to try to convince the court that he (and his tenants) had been occupying the Lot since 1994. 48.In fact, besides the vegetation shown in the aerial photographs, the experts also found that it was only in 2008 when “the Northern Portion…was paved of the ground surface and site cleared.” (Trial Bundle page 264) 49.From these objective evidence and what the 2nd defendant stated in his witness statement, I found that it was more likely that he only came to occupy and started clearing the Northern Portion of the Lot and laid down asphalt around 2008. He then started to build the warehouse which was completed around 2013. He only rented out the Lot (or the warehouse on the Lot) after this time which must mean that the tenancy did not start earlier than 2013. Fencing 50.It is trite that evidence of fencing would produce a clear intention to possess the land to the exclusion of all other persons including the paper owner, that is evidence of animus possidendi. 51.The experts found evidence of fencing as follows (Trial Bundle page 263 and 264):-
52.All these changes in fencing were not mentioned nor explained in the 2nd defendant’s witness statement. 53.In fact, the 2nd defendant only stated in his witness statement that he put up a wire fence at the same time that he was building the warehouse. He also stated that later, he continued to expand the fenced areas. 54.As stated by the experts, the aerial photos show a change of fence from 2007 to 2008 (enclosing a slightly bigger area), and another change of fence between 2009 and 2011 (which enclosed an even bigger area). But the warehouse structure did not appear until 2013 after the latest expansion of fencing was done. 55.The 2nd defendant’s evidence regarding the fencing clearly is not supported by the objective evidence from the aerial photographs. Instead, the objective evidence shows that the change of fence occurred between 2007 and 2008 which also coincided with the start of clearing of the site and lying down of asphalt (see paragraph 49 above). Documentary evidence 56.The 2nd defendant has not produced any utility bills or payment records of government’s levy or tax regarding the Lot despite claiming that he had connected the warehouse with water and electricity supply and had paid for all the utilities himself all along. 57.He has produced a bundle of yearly rental invoices and receipts purportedly from 1 January 1997 for each year up to 1 January 2014 (Trial Bundle page 389-406). 58.He claimed in court that he had actually issued rent invoice and receipts to his tenants but these were destroyed in a flood in 2013. However, his tenant then asked him for two years’ tenancy record because they need to apply for a mortgage. The 2nd defendant therefore “re-issued” these documents. However, the 2nd defendant decided to “re-issue” all the tenancy records back to 1997. These “re-issues” were the documents in the Trial Bundle. 59.Under cross-examination, Mr Tommy Cheung, counsel for the plaintiffs, asked the 2nd defendant why his tenant would need such records from him because surely the tenant must have their own copy of receipts too. 60.The 2nd defendant then changed his story and claimed that the tenant had lost their records too. 61.And then even these alleged “re-issue” rental invoice were problematic: the 2nd defendant informed the court that the monthly rental was HK$900 per month and yet the invoice stated a year rent of HK$3,000 from 1 January 1997 to 1 January 2002, and from then to 1 January 2015 at the yearly rent of HK$9,000. If the monthly rent was HK$900, the yearly rent should of course be HK$10,800. None of the invoices and receipts show this amount. 62.The 2nd defendant also claimed that his second tenant started to rent in 1998 but the “re-issued” invoice went back to 1 January 1997. 63.Further, only “Lot 314 S.B. and Lot 315” were written on the invoices and receipts. There was no mention of the Lot. 64.To all these discrepancies, the 2nd defendant simply explained that he remembered it wrong or he did not know. 65.Mr Cheung also asked the 2nd defendant what his purpose was for “re-issuing” the invoice all the way back to 1998 (or 1997) when his tenant only asked for two years prior to 2013. He confessed that it was for use as evidence in a claim for adverse possession. 66.I find these documentary evidence self-serving and totally unconvincing, and would put no weight on such. The plaintiffs’ case 67.The plaintiffs were the descendants of three brothers who inherited the Lot. The last of the three brothers passed away in 2007 (who was the father of the 6th plaintiff) so the plaintiffs were now the registered owners of the Lot. 68.The only witness for the plaintiffs was the 6th plaintiff. He was the eldest amongst the descendants. 69.According to his witness statement, all along, the Lot had been rented out by the three brothers to the 2nd defendant’s father for a yearly rent of HK$1,000 by way of an oral agreement. 70.The rent had been collected by his father (until his death): he would attend the Lot before the Double Nine festival to collect the rent which would be used for the expenses for the grave visits on Double Nine festival. 71.Since the death of his father in 2007, the 3 branches of descendants took turn in collecting the rent each year and the 2nd defendant’s father continued to pay rent without any problem. 72.After 2007, the plaintiffs wished to turn this oral agreement to a written agreement, especially when the tenant now became the 2nd defendant and not his father. However, despite several attempts to contact the 2nd defendant and his father, the 2nd defendant insisted on maintaining the oral agreement on “mutual trust” and refused to sign any written agreement, and so the oral agreement continued. 73.In around 2015 to 2016, the 5th plaintiff went (as usual) to the Lot to collect rent but was refused. The plaintiffs then agreed to let the 6th plaintiff to deal with this matter. 74.The 6th plaintiff then attended the Lot and could not find the 2nd defendant but noticed some strangers, and came to notice that the 2nd defendant had re-rented the Lot without their consent. 75.The 6th plaintiff contacted the 2nd defendant, met him on the same day and asked him to sign a written agreement. The 2nd defendant refused. 76.According to the 6th plaintiff, the 2nd defendant said at the time:-
77.A few days later, there was a second meeting and the 2nd defendant gave the 6th plaintiff HK$2,000 as rent for 2015 and 2016, and an addition HK$500 as “tea money”, but had again refused to sign any written agreement. 78.However, since that time, the plaintiffs could not contact the 2nd defendant who did not pay any rent. Payment of rent 79.The 6th plaintiff claimed on his witness statement that each branch of the family attended the Lot to collect rent each year in turn since 2007. As the 6th plaintiff is the sole descendant of one branch, he should have attended the Lot and collected the rent at least once or twice in the 8 years between 2007 and 2015. He would have first-hand experience of the rental agreement and would have received the rent (which would have confirmed the existence of the oral rental agreement). 80.However, under cross examination, the 6th plaintiff claimed that the information about the rental agreement prior to 2007 came from the 5th plaintiff. And further, it was also the 5th plaintiff who was responsible for the collection of rent and he never visited the Lot prior to 2015 or 2016. 81.This would be inconsistent with the 6th plaintiff’s evidence in his witness statement. Further, if the 5th plaintiff was responsible for collecting rent from 2007 and was evidently successful until 2015 or 2016, he would have been in the best position to give evidence on the rental agreement. No reason was given as to why, as one of the plaintiff, the 5th plaintiff did not even bother to give evidence in this case. 82.Further, the 6th plaintiff informed the court at trial that it was a lady who had been visiting the 5th plaintiff to pay rent for the Lot. This was again inconsistent with the witness statement that it was the plaintiffs who visit the Lot to seek rental payment, not to mention how the 5th plaintiff could ascertain the role and identity of this “lady” when the money was paid. 83.Further, I found it not credible that, having never visited the Lot (nor, evidently, knew the 2nd defendant beforehand), the 6th plaintiff visited the Lot for the first time in 2015 or 2016 and got a total admission of ownership from the 2nd defendant straightaway: “I won’t cause trouble on your land.” 84.I find it strange that, given this admission, there is no evidence that the 6th plaintiff had ever asked the 2nd defendant why he had stopped paying rent, or warned that he should not sub-let the Lot because he had no permission to do so. 85.Even stranger that, given this rather cordial reassurance and admission, the 2nd defendant also, in the same setting, gave the threat “Go ahead and ask your cousin to come and do their worst”. Why would anyone say this after admitting to the ownership of the Lot and was willing to pay rent? 86.Indeed, the whole scenario proposed by the 6th plaintiff appeared illogical: why would the 2nd defendant refused to sign a written agreement if he had already admitted to the ownership and was willing to pay rent? Alternatively, if the reason for the 2nd defendant refusing to sign was his scheme to claim adverse possession, then why would he make such an oral admission and pay rent thus risked creating evidence against his own claim? 87.Further, given all these disputes about oral versus written agreement, if the 2nd defendant had actually paid the rent personally to the 6th plaintiff as alleged, it would be surprising that the 6th plaintiff had not thought of obtaining any evidence of such payment: a receipt, a photograph of the cash, a deposit slip to the bank, or showing the cash to any number of witnesses etc. No such evidence has been produced. 88.I find the evidence regarding this alleged oral rental agreement unconvincing. On balance, I find that there was no rental agreement of any kind between the plaintiffs’ fathers and / or the plaintiffs, and the 2nd defendant and / or his father, and no rent was ever paid. It was likely that the plaintiffs did not identify the occupier and demand rent until around 2013 to 2016. Conclusion 89.Nevertheless, in the absence of any rental agreement, I also find that the 2nd defendant failed to produced clear unequivocal and compelling evidence regarding a continuous factual possession and animus possidendi of the whole of the Lot since 2005. 90.I find that, on balance of probability, the 2nd defendant only came to occupy the Northern Portion since around 2007 to 2008 (and not 1994 as claimed) when a new fence was built and asphalt laid down. The warehouse structures were completed in 2013 and that was when he started to rent out the Lot. 91.Regarding the Southern Portion, that is, the area occupied by S1 and S2 which had encroached on the Lot, I accept the experts’ opinion that these structures existed since 1981 (Trial Bundle page 263 and 264) and I also accept that these structure were likely built by the 2nd defendant’s father which was passed to the management and possession of the 2nd defendant around 1994. I would therefore find that adverse possession is established concerning the Southern Portion only. 92.It is trite that if the court takes the view that the evidence only supports adverse possession over part of the areas claimed, the court should only grant declaratory relief over that area supported by clear and compelling evidence of adverse possession and should not go beyond that (Lee Theatre Realty Limited v Tong Wah Jor & Others CACV 279/2009 and Wong Pui Wan v Wong Wing Kwong & Others DCCJ 118/2014). 93.As such, I would give the following orders:-
Mr Tommy Cheung, instructed by H Y Leung & Co LLP, for the 1st, 2nd, 3rd, 4th, 5th and 6th plaintiffs The 1st defendant was not represented and did not appear Mr Dixon Co, instructed by Leung, Tam & Wong, for the 2nd defendant | ||||||||||||||||||||||||||||||||
Cases cited in this judgment
Further hearings and rulings under DCCJ 3740/2017