Wu Yim Chung v. Lo Wai Ching and Another

CACV 563/2020

[2022] HKCA 100

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 563 OF 2020

(ON APPEAL FROM DCCJ NO. 4434 OF 2013)

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Before:  Hon Cheung, G Lam and Chow JJA in Court

Date of Hearing:  9 November 2021

Date of Judgment: 21 January 2022

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JUDGMENT

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Hon Chow JA (giving the Judgment of the Court):

INTRODUCTION

1.This is the Plaintiff’s appeal against the judgment of H H Judge S Lo dated 17 June 2019 dismissing the Plaintiff’s claim for adverse possession of Lots Nos 323, 324, 333, 338, 339 and 340 in Demarcation District No 247 (“Lot 323”, “Lot 324”, “Lot 333”, “Lot 338”, “Lot 339” and “Lot 340” respectively, and “the Suit Land” collectively), Sai Kung, New Territories, of which the Defendants are the paper owners.

BASIC FACTS

2.The Plaintiff and his brother (“Kindwind Wu”) were formerly the owners of the Suit Land, having acquired the same by purchase on 13 May 1988.  According to the Plaintiff, after acquisition of the Suit Land, he and his family began to occupy and use the Suit Land for open storage of construction materials and vehicles.  Fences and hoardings enclosing the Suit Land were erected by the Plaintiff and his family.  The fences and hoardings were kept, maintained and repaired by the Plaintiff and his family since that time, until around 2012 when they were replaced by metal hoardings.

3.On 21 December 1988, the Plaintiff and Kindwind Wu sold the Suit Land to a company called Everspread Development Ltd (“Everspread”), but the Plaintiff’s family continued to occupy and use the Suit Land by obtaining, in the name of the Plaintiff’s brother-in-law, Luk Ping On (“Luk”), a 3-year lease dated 14 October 1989 from Everspread.  On 2 March 1992, Everspread sold the Suit Land to one Yu King Kwok (“Yu”), who renewed the lease with Luk on 16 January 1993 for further term of 1 year from 15 October 1992.  Luk’s lease of the Suit Land expired on 14 October 1993.

4.The Plaintiff says that notwithstanding the expiry of the lease granted by Yu, he and his family continued to remain in exclusive possession and use of the Suit Land after October 1993 without payment of any rent or licence fee to Yu or anyone else.  It is the Plaintiff’s pleaded case that he and his family’s adverse possession of the Suit Land commenced in about 1994[1] and continued for no less than the requisite limitation period of 12 years without any interruption or disturbance by anyone including Yu.

5.Yu passed away in March 2002.  His widow, Kwong Shook Ling (“Kwong”), succeeded to the Suit Land as the sole executrix of the estate of Yu on 8 April 2003.

6.In 2004, Kwong commenced, inter alia, 4 actions in the High Court, namely, HCMP 144, 146, 148 and 151 of 2004 (“the Possession Actions”), to recover Lots 340, 339, 338 and 323 from the respective occupier(s)/trespasser(s) thereof.  On 30 March 2004, Kwong obtained orders for possession (“the Possession Orders”) of those lots by default from the High Court.

7.On 17 September 2013, Kwong sold the Suit Land to the 1^st Defendant (Lots 333, 339 and 340)and the 2^nd Defendant (Lots 323, 324 and 338), who thereby became the paper owners of the Suit Land.

8.A demand letter was issued by the Defendants’ solicitors, Messrs Lam, Lee & Lai, to the Plaintiff on 6 November 2013 complaining about his trespass of the Suit Land, including the fencing off of, and storing of materials on, the Suit Land.

9.On 15 November 2013, the Plaintiff commenced the action below against the Defendants claiming that the Defendants’ title to the Suit Land had been extinguished by adverse possession, and he had acquired a possessory title to the Suit Land.  In their Defence and Counterclaim, the Defendants disputed the Plaintiff’s claim of adverse possession.  The Defendants contended that the Plaintiff’s alleged possession of the Suit Land was, in any event, interrupted when Kwong (the Defendants’ predecessor-in-title) commenced the Possession Actions and obtained the Possession Orders in respect of Lots 340, 339, 338 and 323 in 2004.  The Defendants further contended that the Plaintiff ought to have made his claim of adverse possession by joining himself as intervenor or 2^nd defendant in the Possession Actions to set aside the Possession Orders.  The Defendants counterclaimed against the Plaintiff for injunctive relief, damages and mesne profits.

THE JUDGMENT

10.The trial of the action came before the Judge in April and May 2019.  At the trial, the Plaintiff and 1^st and 2^nd Defendants, as well as their respective expert surveyors (who had prepared a “Joint Report” dated 18 July 2017), gave oral evidence.

11.The Judge gave a written judgment on 17 June 2019 (“the Judgment”) in favour of the Defendants.  In the Judgment, the Judge accepted the following findings in respect of the status and occupation of the Suit Land contained in the Joint Report[2]:

(1)  The area now occupied by the Plaintiff (“the Occupied Area”) is slightly larger than the Suit Land.  The Suit Land takes up around 93% of the Occupied Area.

(2)  Based on the aerial photos -

“(a) From 1989 to 1993, the Suit Land was used for parking vehicles, placing construction materials and containers.

(b) From 1994 to 1995, all the cars and construction materials were removed. A gate was barely seen [near] the north end of D1 Land (‘Northern Gate’).

(c) From 1996 to 2003, there appeared to be a driveway through the Occupied Area from the south to the Northern Gate. A number of cars including a white bus were seen.

(d) In 2004, the entrance of the driveway at the south portion was blocked by unidentified objects.

(e) From 2005 to 2006, grasses started to grow and were over-grown.

(f) From 2007 to 2009, most of the grasses were cleared.

(g) In 2010, some hoardings were erected along the common boundary with D2 Land.

(h) From 2011 to 2013, grasses started to grow and then cleared again.

(i) In 2014, more materials were placed inside.”

(3)  Based on the survey sheets -

“(a) Since around April 1992, fences and Northern Gate were seen on the Suit Land.

(b) Since around February 2009, fences running across the southern portion of Lot Nos. 323 and 338 in D.D. 247 were removed (such that they became connected to the adjacent Lot Nos. 339 and 340 which continued to have fences in their southern portion with an entrance connecting to the access road).  The Suit Land was occupied by … open storage.”

12.The Judge next resolved a number of factual issues arising in the trial:

(1)  The Judge rejected the Plaintiff’s evidence that he had installed a metal chain at an opening of some 30 to 40 feet in width with no gate or barrier on the southern side of the Suit Land (“the Southern Entrance”)[3].

(2)  The Judge rejected the contention made by counsel on behalf of the Plaintiff that a road/track on the southern side of the Suit Land (“the road/track”), which gave access to the Suit Land through the Southern Entrance, was a “dead-end” which only led to other surrounding lots of the Plaintiff and “did not serve any other land, and its enjoyment was exclusive to [the Plaintiff]”.  The Judge found that the road/track was not a dead-end and did serve other lands, and its enjoyment was not exclusive to the Plaintiff[4].

(3)  The Judge rejected the Plaintiff’s contention that he had signified to the world at large that the Suit Land belonged to him by the erection of a “Shing Fung Studio” signboard (“the Shing Fung Signboard”) and other signboards showing “no unauthorized entry”.

(a)  In respect of the Shing Fung Signboard, the Judge found that it was erected near to the north of Lot 335 which was quite far away from the Southern Entrance, and was irrelevant because anyone who intended to enter into the Suit Land via the Southern Entrance would not and could not have noticed it.  The Judge further noted that the Plaintiff failed to show when the signboard was erected and, taking the Plaintiff’s evidence at face value, it was only erected sometime in 2017[5].

(b)  As for the other signboards showing “no unauthorized entry” allegedly put up by the Plaintiff, the Judge noted that the Plaintiff had failed not only to tell their exact contents, but also failed to identify their exact locations.  The Judge considered that if they were located far away from the Southern Entrance, they would have no relevance.  The Judge rejected the Plaintiff’s evidence in respect of those signboards[6].

13.Based on the aforesaid findings, the Judge expressed the following view at §41 of the Judgment:

“… P has not done his best to exclude the world at large, including the owner, from the Suit Land so far as is reasonably practicable, in particular there is an opening in the Suit Land namely the Southern Entrance without any metal chain, any kind of barrier or warning signboard so that any cars driven by outsiders including the owner can freely access to the Suit Land at any time”.

14.The Judge next dealt with a few other factual issues “for the sake of completeness”, including:

(1)  Before 1994, wire mesh fence had been erected by workers of the Plaintiff’s father on the Suit Land when the Plaintiff and Kindwind Wu were still owners, or tenants, of the Suit Land.  However, the building of the fence could not be used as evidence in support of the Plaintiff’s alleged adverse possession commencing from 1994[7].

(2)  From 1996 to 2003, there appeared to be a driveway (“the Driveway”) through the Occupied Area from the south to a gate at the northern side of the Suit Land (“the Northern Gate”). The experts said that the Driveway was the result of frequent passage by vehicles and was not a Driveway built by the Plaintiff.  In any event, there was no evidence from the Plaintiff that he or his family built the Driveway.  Besides, a number of cars (including a white bus) were found scattered on the Suit Land and not parked properly.  They appeared to be “disposed” vehicles, ie unwanted or scrap vehicles or vehicles which had been abandoned or written off by the owners.  The Plaintiff never said that those vehicles were owned by him or his related companies, and did not provide any explanation as to why they were allowed to be “stored” in the Suit Land if they were owned by someone else. The Judge considered that the Plaintiff should have no difficulty in producing some evidence concerning the ownership of those vehicles, and the failure of the Plaintiff to produce such evidence or explanation should be approached with “skepticism and caution”[8].

(3)  Both the Plaintiff’s expert report dated 24 February 2017 and the Joint Report recorded that in 2004, the Southern Entrance was wholly blocked by some unidentified huge objects which (the Judge considered) looked like containers.  There was no evidence from the Plaintiff that it was him who blocked the entrance.  In fact, the Plaintiff gave no explanation at all in all his witness statements as to why the entrance was suddenly blocked.  The Judge considered that there was no good reason for the Plaintiff to block the Southern Entrance in view of his evidence that he had installed a metal chain at the opening to allow egress and ingress of large construction vehicles and trucks in or out of the Suit Land.  The Judge accepted the submission of the Defendant’s counsel (Mr Lau) that the blockage was highly likely to have been done by Kwong in view of the fact that the Possession Actions were commenced by her to recover (part of) the Suit Land in 2004.  The Judge considered, accordingly, that the Plaintiff’s continuous possession of the Suit Land was thereby broken, even if he had started to possess the Suit Land in 1993/1994[9].

(4)  Prior to the purchase of the Suit Land from Kwong, the Defendants had during the period from October 2012 to September 2013 inspected the Suit Land many times[10] and were able to freely enter into and leave the Suit Land, which the Judge considered they could do easily via the Southern Entrance, without any interference by the Plaintiff or his representatives[11].

(5)  The 1^st Defendant’s photographer, who had taken various photographs of the Suit Land[12] which were produced in the 1^st Defendant’s witness statement dated 27 June 2017, was also able to freely enter into and leave the Suit Land without any interference by the Plaintiff or his representatives[13].

(6)  Although the Plaintiff said in his oral evidence that his family had, since the expiry of the tenancy of the Suit Land granted by Yu, incurred substantial time and costs in improving the Suit Land, and acquired between 1988 and 1998 many adjacent lots to the extent that the Suit Land had become “circled” by them, the Plaintiff failed to explain why he and Kindwind Wu had to sell the Suit Land in December 1988.  The Judge considered that the Plaintiff’s evidence must, therefore, be considered with skepticism[14].

(7)  The Judge found that a “Private Survey Report” prepared in March 2012 (which was attached to both the Plaintiff’s expert report dated 24 February 2017 and the Defendants’ expert report dated 12 April 2017) was prepared either for the then landowner (Kwong) or someone with her permission.  In order to carry out the survey, the surveyor would need to plant nails and iron spike and set up a tripod inside the Suit Land.  In the absence of evidence that the Plaintiff or his representatives ever tried to exclude the surveyor from the Suit Land, the Judge found that the act of the surveyor, done on behalf of Kwong, would constitute an act of discontinuance of the Plaintiff’s possession of the Suit Land[15].

(8)  Lastly, the Judge recognized that the matters referred to in (5) and (7) above occurred after 2006 (ie more than 12 years from the commencement of the Plaintiff’s alleged adverse possession of the Suit Land in 1994), and thus might not be relevant to the Plaintiff’s claim.

15.At §53 of the Judgment, the Judge concluded as follows:

“… the determination of the issue of adverse possession is a question of fact. In my view, based on my findings above and even ignoring the Private Surveyor Report and D1’s photos, I am not satisfied that P has continuously [been] in possession of the Suit Land for more than 12 years and that he has discharged his heavy burden of proof of the requisite intention to exclude the world at large, including the owner, from the Suit Land. All P’s claim must be dismissed entirely.”

16.Having come to this conclusion, the Judge took the view that it was not necessary to determine the effect of the Possession Orders on the Plaintiff’s adverse possession claim, including the question of whether the Plaintiff should have applied to set aside the Possession Orders instead of commencing the action below[16]. The Judge also considered various issues on relief which it is not necessary to set out in this judgment.

17.In the sealed judgment dated 9 August 2019, the Judge, inter alia:

(1)  dismissed the Plaintiff’s claims;

(2)  granted an injunction requiring the Plaintiff to forthwith demolish all structures and hoardings on or enclosing the Suit Land and remove all containers and vehicles from the Suit Land;

(3)  ordered the Plaintiff to deliver vacant possession of the Suit Land to the Defendants; and

(4)  granted an injunction restraining the Plaintiff whether by himself or his servants or agents or otherwise howsoever from entering or using the Suit Land or from driving or parking any motor vehicles upon it.

THE APPEAL

18.The Plaintiff was not satisfied with the Judgment, and lodged an appeal against the Judgment by a Notice of Appeal dated 20 October 2020 pursuant to the leave to appeal granted by Au JA on 12 October 2020.  7 grounds of appeal are set out in the Notice of Appeal:

(1)  Ground 1 - the Judge erred in law in adopting an erroneous approach in assessing the Plaintiff’s evidence;

(2)  Ground 2 - the Judge failed to apply the correct test for “factual possession”;

(3)  Ground 3 - the Judge erred in ignoring the undisputed fact that the Plaintiff was previously the registered owner and tenant in occupation of the Suit Land;

(4)  Ground 4 - the Judge erred in disregarding facts and evidence which are pertinent to the Plaintiff’s claim for adverse possession;

(5)  Ground 5 - the Judge erred in relying upon supposition which is speculation, irrelevant, unsupported by evidence and/or contradicted by expert evidence;

(6)  Ground 6 - the Judge erred in making findings which are directly contradicted by unchallenged expert evidence; and

(7)  Ground 7 - the Judge erred in wrongly applying the decision of Wilson Chan J in Chan San v Hans Li [2019] HKCFI 714.

19.On the other hand, the Defendants filed a Respondents’ Notice dated 10 November 2020 contending that the Judgment should be affirmed on the additional ground that, since the Possession Orders have not been set aside, the Plaintiff should have applied to join as a party in the Possession Actions and set aside the Possession Orders instead of commencing the action below to claim adverse possession of the Suit Land against the Defendants.

GROUND 1 - PROPER APPROACH IN ASSESSING THE PLAINTIFF’S EVIDENCE

20.In support of the contention that the Judge erred in adopting an erroneous approach in assessing the Plaintiff’s evidence, Mr Erik Shum (for the Plaintiff) raises two main arguments.

21.Mr Shum’s first argument is that the Judge erred in applying a “non-existing” test with the objective of seeking to decide if “P has done his best to exclude the world at large”, whereas the proper test for factual possession is whether the squatter has exclusive physical possession which turns on sufficiency of the degree of control and the proper test for animus possidendi is whether the acts of the squatter have demonstrated to the world that he has exercised such control of the land as an owner would have done[17].

22.The Judge was plainly aware of the proper test for (i) factual possession, and (ii) the requisite intention to possess (or animus possidendi). At §14 of the Judgment, the Judge referred to the judgment of the Court of Appeal in Tsang Foo (also known as FU) Keung and Another v Chu Jim Mi Jimmy and Others [2017] 3 HKC 527, in particular the summary of the applicable principles by Harris J at §22 of his judgment (with whom Cheung and Yuen JJA agreed), which the Judge stated in his own words as follows:

“(i) In order to succeed in claiming possessory title by adverse possession, the claimant must show that he has both the factual possession during the relevant period and the requisite intention to possess.

(ii) The requisite factual possession is a sufficient degree of exclusive physical control, and what is sufficient depends on the circumstances of the case and, in particular, the nature of the land and the manner in which land of that nature is commonly enjoyed. What must be shown is that the alleged possessor has been dealing with the land as an occupying owner might expect to deal with it.

(iii) The requisite intention is to exclude the world at large, including the owner, from the land so far as is reasonably practicable and so far as the law allows.”

23.We do not accept Mr Shum’s submission that the proper test for animus possidendi is whether the acts of the squatter have demonstrated to the world that he has exercised such control of the land as an owner would have done.  If a squatter has exercised such control of the land as an owner would have done, that would be evidence from which one may, and often can, conclude that the squatter has established the requisite intention to possess.  However, such control should not be equated with, or be treated as definitive of, animus possidendi.  In J A Pye (Oxford) Ltd v Graham [2003] 1 AC 419, Lord Hutton said the following at §76:

“I consider that such use of land by a person who is occupying it will normally make it clear that he has the requisite intention to possess and that such conduct should be viewed by a court as establishing that intention, unless the claimant with the paper title can adduce other evidence which points to a contrary conclusion. Where the evidence establishes that the person claiming title under the Limitation Act 1980 has occupied the land and made full use of it in the way in which an owner would, I consider that in the normal case he will not have to adduce additional evidence that he had the intention to possess.” [underlining added]

24.That evidence showing that a squatter has exercised such control of the land as an owner would have done is not conclusive of the issue of animus possidendi is clear from what Lord Hutton went on to state immediately after the above quote:

“It is in cases where the acts in relation to the land of a person claiming title by adverse possession are equivocal and are open to more than one interpretation that those acts will be insufficient to establish the intention to possess”.

25.The same point was made by Slade J in Powell v McFarlane (1979) 38 P&CR 452, at 472:

“If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi and consequently as not having dispossessed the owner.” [underlining added]

26.In Wong Tak Yue v Kung Kwok Wai & Another (No 2) (1997-98) 1 HKCFAR 55 at 68H-J, Li CJ, giving the leading judgment of the Court of Final Appeal, quoted (with approval) the following observation of Slade J in Powell v McFarlane (at 471-472) in respect of the requisite intention to possess for establishing 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”.

27.The Judge’s consideration of whether the Plaintiff “has not done his best to exclude the world at large, including the owner, from the Suit Land so far as is reasonably practicable” in his assessment of the issue of animus possidendi is not inconsistent with the relevant principles set out in Tsang Foo (also known as FU) Keung v Chu Jim Mi Jimmy, Powell v McFarlane, and Wong Tak Yue v Kung Kwok Wai.

28.Mr Shum criticizes the following parts of the Judgment where it is said the Judge adopted the erroneous test of whether the squatter “has done his best” to exclude the world at large, including the owner:

(1)  §§24 to 31 of the Judgment - where the Judge wrongly focused on whether the Plaintiff has installed a metal chain at the Southern Entrance since 1994;

(2)  §§32 to 37 of the Judgment - where the Judge wrongly focused on whether the Plaintiff has completed the fencing of the Southern Entrance by installing another gate there and whether the road/track only led to other lands of the Plaintiff; and the Judge wrongly emphasised that “there is no difficulty for P to complete the fencing of the Southern Entrance”;

(3)  §§38 to 40 of the Judgment - where the Judge wrongly focused on whether the signboards were erected by the Plaintiff on the Suit Land; and the Judge wrongly relied on his finding that “P fails to show when the Shing Fung Studio signboard was erected”; and

(4)  §41 of the Judgment - where the Judge found against the Plaintiff by wrongly relying on (a) there is an opening in the Suit Land at the Southern Entrance without metal chain, any kind of barrier or warning signboard, (b) such that the inference is that “any cars driven by outsiders including the owner can freely access the Suit Land”, when there is no evidence that such outside cars ever entered the Suit Land.

29.Mr Shum’s criticisms of various parts the Judgment mentioned above are not justified.

(1)  In respect of §§24 to 31 of the Judgment, the Judge was dealing with a factual assertion raised by the Plaintiff for the first time in his re-examination that he had installed a metal chain at the Southern Entrance which, according to him, was usually placed on the ground to allow egress and ingress of large construction vehicles and trucks.  In his closing submissions dated 30 April 2019 (“the Closing Submissions”), Mr Adrian Leung (counsel for the Plaintiff at trial) relied on the installation of the metal chain by the Plaintiff as evidence going to both the issues of factual possession and animus possidendi -

(a)  At §56.4 of the Closing Submissions, under the sub-heading of “dealing with the Suit Land as the occupying owner”, Mr Leung argued that the Plaintiff and his family had imposed reasonable measure to control the access and security of the Suit Land as if an occupying owner might have been expected to do so by (inter alia) the installation of the metal chain.

(b)  At §§80.2 and 80.4 of the Closing Submissions, under the sub-heading of “No complete enclosure with an entrance in the South?”, Mr Leung argued that the Plaintiff’s uncontradicted evidence is that he had installed a metal chain of 30-40 feet long at the entrance in the South, and “[t]hus, the encircle of the Suit Land by P was complete by the metal chain”.

(c)  At §92.5 of the Closing Submissions, under the sub-heading of “P’s submission on ‘intention to possess’”, Mr Leung argued that the Plaintiff also gave evidence that the small opening at the southern part of the Suit Land was secured and controlled by a metal chain of around 30-40 feet to facilitate the entry of large trucks and containers.

In our view, the large opening of some 30 to 40 feet in width at the Southern Entrance to the Suit Land was plainly an important aspect relevant to the question of whether the Plaintiff had at the material time exercised a sufficient degree of exclusive physical control of the Suit Land, and whether he had the requisite intention to exclude the world at large.  Bearing in mind the nature and use of the Suit Land (an open ground for storage of constructions materials and vehicles) and its location (in the New Territories), an occupying owner would normally be expected to take reasonable steps to control access, or secure entrance, to the Suit Land.  A failure to do so would naturally attract unauthorized parking or storage, or other unauthorized uses, such as a dumping ground for construction waste or unwanted/scrap vehicles.  The Judge was, in our view, correct to consider this allegation of a metal chain raised by the Plaintiff and took it into account in his assessment of whether the Plaintiff has demonstrated the two elements of adverse possession.

(2)  In respect of §§32 to 37 of the Judgment, the Judge’s observation at §32 that there was “no difficulty at all for P to complete the fencing of the Southern Entrance or to install another gate there” was accepted by Mr Leung (see §80.5 of the Closing Submissions).  In those paragraphs, the Judge was dealing with the point raised by the Plaintiff that although the Suit Land had an opening at the Southern Entrance which connected the Suit Land to the road/track, the road/track was a dead-end which only led to other lots belonging to the Plaintiff and its enjoyment was exclusive to the Plaintiff.  This point arose out of Mr Leung’s argument that although there was no complete fencing of the Southern Entrance, nor any gate installed at the Southern Entrance similar to the Northern Gate, it was not necessary to do so because, in the case of open land, absolute physical control was normally impracticable and it was generally impossible to secure every part of a boundary so as to prevent intrusion (see §§80.8-80.11 of the Closing Submissions). The Judge, after considering the evidence, rejected the suggestion that the road/track was a “dead-end”, or its enjoyment was exclusive to the Plaintiff, and found instead that it also served other lots not belonging to the Plaintiff.  We do not see that any valid criticism can be made of the Judge’s consideration of and finding on that issue.

(3)  In respect of §§38 to 40 of the Judgment, the Judge was dealing with a submission made by Mr Leung that the Plaintiff signified to the world at large that the Suit Land belonged to the Plaintiff’s family by the erection of, inter alia, the Shing Fung Signboard (see §§91.1-91.4 of the Closing Submissions).  The Judge considered that the said signboard did not assist the Plaintiff because it was located quite far away from the Southern Entrance and anyone who wished to enter the Suit Land via the Southern Entrance would not and could not have any notice of it.  The Judge also rejected the relevance of the Shing Fung Signboard because the Plaintiff only produced a photograph of it taken in 2017 (4 years after the commencement of the action), and failed to show when it was first erected.  As for other signboards showing “no authorized entry” allegedly put up by the Plaintiff, the Judge had reservations about the Plaintiff’s evidence, noting that they were never mentioned in his witness statements and only came out in his oral evidence (“sudden and bare assertion of P in court without producing any photos in support”[18]). The Judge rejected this part of the Plaintiff’s evidence because he had failed to give evidence on (i) the exact contents of the signboards, and (ii) their exact locations.  We do not accept Mr Shum’s argument that the Judge wrongly focused on whether the signboards were erected by the Plaintiff on the Suit Land.  In our view, the location of the alleged signboards is relevant to the issues of (i) factual possession, and (ii) animus possidendi.

(4)  Lastly, Mr Shum complains that the Judge’s view expressed at §41 of the Judgment, namely, that there was “an opening in the Suit Land namely the Southern Entrance without any metal chain, any kind of barrier or warning signboard so that any cars driven by outsiders including the owner can freely access to the Suit Land at any time”, is not justified because there is no evidence that outside cars entered the Suit Land.  We consider that this view of the Judge should be read in the light of his finding or observation at §44 of the Judgment that (i) there were a number of cars including a white bus found in the Suit Land believed to be “disposed vehicles as they [were] scattered inside and were not parked properly” (a finding based on the aerial photos referred to in §22(i)(c) of the Judgment), and (ii) the Plaintiff “never said that those vehicles were owned by him or his related companies”, or explained “why they were allowed … to be stored in the Suit Land” if they were owned someone else.  In any event, the Judge was considering the question of whether the Plaintiff had done his best, so far as was reasonably practicable, to exclude the world at large, including the owner, from the Suit Land, not whether outside cars did, as a matter of fact, enter the Suit Land.

30.Mr Shum’s second argument under Ground 1 is that the Judge wrongly applied the approach that, when considering the issue of animus possidendi, a squatter’s evidence of his “subjective intent” should be viewed with “skepticism and caution”, to the consideration of the issue of “physical possession and evidence of acts pointing to possession by the squatters”.  Mr Shum argues that evidence of “objective act of physical possession” should be given such weight as it deserves, even when the same comes from the squatter, and be weighed on the usual balance of probabilities standard[19]. In our view, there is nothing in this criticism of the Judge’s assessment of various aspects of the Plaintiff’s evidence.  The approach that one should view with “skepticism and caution” a squatter’s evidence of his “subjective intent” when considering the issue of animus possidendi is simply an approach of common sense that one should not readily accept a bare, self-serving, statement made by a party without question.  In each of the 4 instances where the Judge expressed the view that the Plaintiff’s evidence should be approached with skepticism and/or caution (namely, §§28, 39, 44 and 48 of the Judgment), the Judge was either dealing with evidence given by the Plaintiff which only came out in court but did not appear in his 3 witness statements (§§28 and 39 of the Judgment), or the Plaintiff’s failure to give relevant evidence on a matter which the Judge considered he should have no difficulty in giving (§§44 and 48 of the Judgment[20]). We do not consider that the Judge’s assessment of those aspects of the Plaintiff’s evidence can be faulted.

GROUND 2 - CORRECT TEST FOR FACTUAL POSSESSION

31.Under this ground, the Plaintiff contends that, other than applying the wrong test in law and wrongly requiring the Plaintiff to prove that “he has done his best to exclude”, the Judge “failed to address his mind to the correct test of sufficient degree of exclusive physical control as an owner might expect to have (first element) and inference from the acts done in infer animus possidendi.  The word control or degree of control never appears in the decision making process in the Judgment.  The positive evidence of the Plaintiff to objectively use and control the Suit Land since 1988 or 1993 to 2005 and onwards was never referred to in the Judgment”[21].

32.The Judge correctly set out the applicable test for factual possession at §14(ii) of the Judgment, viz, “The requisite factual possession is a sufficient degree of exclusive physical control, and what is sufficient depends on the circumstances of the case and, in particular, the nature of the land and the manner in which land of that nature is commonly enjoyed.  What must be shown is that the alleged possessor has been dealing with the land as an occupying owner might expect to deal with it.”  In his conclusion on the Plaintiff’s adverse possession claim, the Judge stated, at §53 of the Judgment, that “based on [his] findings above”, he was not satisfied that the Plaintiff had continuously been in possession of the Suit Land for more than 12 years.  The “findings” referred to by the Judge were those matters set out in §§18-52 of the Judgment which we have summarized in §§11-14 above. They include various matters relied upon by the Plaintiff as objective evidence of his use and control of the Suit Land from around 1993/1994 to 2006.  The Judge dealt with the major evidence and issues arising in the trial, and was under no obligation to set out and consider each and every fact and matter relied upon by the Plaintiff in support of his adverse possession claim.  There is no reason to believe that the Judge, in his assessment of the issue of factual possession, failed to apply the proper test which he had correctly set out at §14(ii) of the Judgment.  We also consider that the Judge was entitled to take the view, based on the findings in §§18-52 of the Judgment, that the Plaintiff had not discharged “his heavy burden of proof of the requisite intention to exclude the world at large, including the owner, from the Suit Land” (§53 of the Judgment).

GROUND 3 - PLAINTIFF WAS PREVIOUSLY THE REGISTERED OWNER AND TENANT IN OCCUPATION OF THE SUIT LAND

33.Under Ground 3, the Plaintiff contends that the Judge erred in law in failing to take into account the undisputed and indisputable facts/evidence that the Plaintiff and his family started using and occupying the Land since 1988, first as owner, then as tenant, and continued to do so without interruption after ceasing to pay any rent under any tenancy. The presumption of occupation applies in favour of the Plaintiff when he was owner; the same presumption would apply to the period when he was tenant.  In the absence of any other person who interfered with the continuous occupation by the Plaintiff, the presumption would continue, and exclusive possession as a matter of fact would logically continue after 1993.  The Judge ignored the above important background facts but simply focused on whether “P had done his best” to exclude the whole world[22].

34.We accept, as a matter of principle, the fact that after the expiry of a tenancy, a tenant continues to occupy land previously occupied by him under the tenancy but pays no rent to his landlord is a factor relevant to both the issues of factual possession and animus possidendi. In Williams v Jones & Anor [2002] EWCA Civ 1097, Buxton LJ stated in §§21 and 22 of his judgment as follows:

“[21] Mr Cooper for the appellant [the paper title owner] was in my judgement wrong in his argument that on the determination of the tenancy the matter ought to be looked at afresh, by straightforward application of the approach in Powell v McFarlane, without regard to the fact that the tenant was a tenant holding over. Such an approach would be plainly inconsistent with what this court said in Haywood v Chaloner. I consider, therefore, that Mr Cooper’s predecessor in representing the appellant was in fact correct when he said this (paragraph 14 of his first skeleton argument):

‘The true distinction between a ‘trespasser case’ and a ‘former tenant case’ is that in the former, animus possidendi is required in order to establish that the paper owner has been dispossessed. That is not necessary in a ‘former tenant’ case, because as the freeholder has permitted the tenant into possession, he will normally continue in possession, just as he did before the payment of rent stopped.’

[22] Mr. Cooper specifically disclaimed that passage, as indeed he had to do.  In my respectful judgement it, at least in the second sentence, was correct.”

35.We doubt, however, whether it is helpful to characterize the fact of holding over by a tenant as giving rise to a presumption of adverse possession as suggested by the Plaintiff.  In our view, the weight that should properly be given to this factor must depend on the facts and circumstances of the case.  In support of his argument under this ground, Mr Shum relies heavily on the judgment of the Court of Appeal in Poon Chi Hang v Lai Ho Sun [2019] HKCA 734, in particular the following passage at §32 of the judgment of Barma JA (with whom Cheung JA and Yuen JA agreed):

“… the fact that there was a tenancy to start with is a key factor in ascertaining whether or not possession by Poon Yiu Chung, his family, and the plaintiff was accompanied by the requisite intention to possess adversely to the title of the defendant. Given the existence of such a tenancy, under which rent was paid for a short period, the continued exclusive occupation of the property without payment of rent was clear evidence of an intention to possess the property adversely to the rights of the true owner. In my view, this alone would be sufficient to establish the requisite intention to possess.”

36.It is important to read this passage in the light of the factual circumstances of that case.  There, the subject matter of the adverse possession claim was a residential flat in a building in Ho Man Tin, Kowloon.  The flat was acquired by the plaintiff’s father and the defendant’s father, who were business partners, but registered in the name of the defendant in 1973.  Since about 1975, the flat was occupied by the family of the plaintiff’s uncle pursuant to an informal tenancy, under which the plaintiff’s uncle paid rent to the defendant’s father (no payment was made to the plaintiff’s father, the same having apparently been waived).  In about 1976, the partnership between the plaintiff’s father and the defendant’s father came to an end in somewhat acrimonious circumstances, and the flat was treated by both sides as belonging solely to the defendant.  Nevertheless, the plaintiff’s uncle’s family continued to occupy the flat without payment of any rent to the defendant (or his father) until 1997 when the plaintiff’s aunt handed over the flat to the plaintiff, giving him the keys to it.  The plaintiff then changed the locks to the flat and started to occupy the flat without payment of any rent to the defendant (or anyone else) until 2013 when he commenced proceedings claiming title to the flat by adverse possession. Having regard to the nature of the property, namely, a self-contained residential unit in a building, and the fact that the plaintiff occupied it with his family as their residence, it was clear that the plaintiff had factual possession of the flat.  As for the issue of an intention to possess the flat adversely to the rights of the defendant, the fact that there was initially a tenancy but payment of rent was ceased after a short period of time was plainly a material factor in favour of the plaintiff, particularly in view of the defence raised at the trial, namely, that the occupation of the flat by the plaintiff was with the unspoken (or implied) permission of the defendant or his family.  If the plaintiff could establish an intention to exclude the defendant from the flat, there could not be any doubt that he also intended to exclude the world at large.

37.The position in the present case is different. Here, the Suit Land is a piece of open land in the New Territories (albeit partially fenced).  In order to make out his claim for adverse possession, the Plaintiff has to show that he had exercised a sufficient degree of exclusive physical control of the land (having regard to the nature of the land and the manner in which land of that nature is commonly enjoyed) vis-à-vis not just the owner (ie Yu or Kwong during the period from 1994 to 2006), but also the world at large.  Similarly, the requisite intention to exclude others from the Suit Land so far as is reasonably practicable and so far as the law allows must also be shown not just against the owner, but also the world at large. The fact that the Plaintiff was a former owner or tenant[23] of the land, and continues to use or occupy the land after the expiry of the tenancy is of limited relevance to the question of whether the Plaintiff had exercised a sufficient degree of control and shown the requisite intention to possess vis-à-vis the world at large (other than the owner).  In any event, even if the Judge ought to have taken this factor into account, we consider the Judge’s ultimate conclusion that the Plaintiff has failed to prove the two elements of factual possession and animus possidendi, based on the facts and circumstances found by him, to be justified.

GROUND 4 - JUDGE ERRED IN DISREGARDING FACTS AND EVIDENCE PERTINENT TO PLAINTIFF’S CLAIM

38.Grounds 4 to 6 all concern findings of fact (including assessment of the weight to be given to some evidence) made by the Judge, and can be dealt with briefly.  The Court of Appeal’s approach in dealing with appeals against findings of fact by a trial judge is well established and does not have to be repeated here (see Ting Kwok Keung v Tam Dick Yuen (2002) 5 HKCFAR 336; China Gold Finance Limited v Cil Holdings Limited and Others, CACV 11/2015 (27 November 2015)).

39.Three matters are relied upon by the Plaintiff under this ground.  First, it is argued that the Judge wrongly rejected the Plaintiff’s evidence concerning the erection of the wire mesh fence simply because it was installed before 1994 when the Plaintiff was still the owner, and later on tenant, of the Suit Land.  The erection of such fence in those periods (1989-1992) is, the Plaintiff argues, directly pertinent to his case of continuation of exclusive possession after 1993 because it has remained in place up to the present[24]. At §43 of the Judgment, the Judge took the view that the “building” of the fence prior to 1994 could not be used to support the Plaintiff’s alleged adverse possession commencing from 1994.  This view of the Judge is correct. The erection of fences/hoardings by an owner/tenant of open land in the New Territories is unexceptional.  The Judge did not say that the maintenance or repair of the fence after 1994 was irrelevant.  The fact that the fences and hoardings were kept or maintained by the Plaintiff’s family since 1988 was expressly referred to by the Judge at §2 of the Judgment.  It was a matter for the Judge to assess the weight that should properly be given to this factor. It is apparent that the Judge placed significant weight on the fact that the Plaintiff left a large opening at the Southern Entrance to the Suit Land without any barrier, warning signboard or metal chain which enabled or allowed free or unrestricted access to the Suit Land by the world at large in coming to the conclusion that the Plaintiff had failed to establish the two elements of adverse possession.  We consider that the Judge was entitled to adopt such view.

40.Second, the Plaintiff complains that the Judge wrongly held, at §48 of the Judgment, that he “simply failed to explain why he and Kindwind Wu had to sell the Suit Land in December 1988” notwithstanding the explanation given in §8 of the Plaintiff’s 1^st witness statement. There, the Plaintiff said that as the price of land rose quickly at that time, the Suit Land was sold on 21 December 1988 to Everspread, and the profits were used to buy a neighbouring lot (namely, Lot No 337RP).  We accept that the Judge seemed to have failed to take into account the Plaintiff’s explanation for the sale of the Suit Land in 1988, but we do not consider this omission to be material or of any great significance to the ultimate issue of whether the Plaintiff has established the two elements of adverse possession in the present case.

41.The Plaintiff also complains that the Judge failed to properly consider, at §48 of the Judgment, whether the Suit Land was “land-locked” by the 27 lots acquired by the Plaintiff to surround and encircle the Suit Land[25]. It is clear from the map (Exhibit P2) handed up by Mr Leung, who was responsible for arguing this part of the appeal on behalf of the Plaintiff, that the Suit Land is not landlocked as alleged.  That this is so was accepted by Mr Leung at the hearing.

42.Third, the Plaintiff complains that the Judge’s finding at §48 of the Judgment is plainly wrong and contradicted by undisputed evidence[26].

(1)  At §48 of the Judgment, the Judge states as follows -

“From 1996 to 2003, there appeared to be a driveway through the Occupied Area from the south to the Northern Gate. The experts said that the driveway was the result of frequent passage by vehicles that it is not a driveway built by P. In any event, there is no evidence from P that they built the driveway. Besides, a number of cars including a white bus found in the Suit Land were believed to be disposed vehicles as they scattered inside and were not parked properly. However, P never said that these disposed vehicles were owned by P or his related companies. If they were owned by someone else, P should give further explanation as to why they were allowed by P to be stored in the Suit Land. In my view, there should be no difficulty for P to produce at least some evidence concerning the ownership of these vehicles and showing the fact that they are really disposed, bearing in mind that P is required to give clear and affirmative evidence to prove the requisite intention to possess and to exclude the world at large. Again, the fact that no evidence or explanation is given by P in this regard should similarly be approached with skepticism and caution.”

(2)  The Plaintiff argues that the Judge wrongly held that he gave no evidence that the vehicles parked on the Suit Land “are really disposed cars” when it was not disputed by the experts in their Joint Report that the vehicles thereon “were believed to be disposed cars as they scattered inside the area and were not properly parked”.  In our view, the Plaintiff has failed to properly understand the Judge’s comment that “there should be no difficulty for P to produce at least some evidence concerning the ownership of these vehicles and showing the fact that they are really disposed …”.  What the Judge was saying was that although the Plaintiff alleged that he had exclusive control of the Suit Land and used it for storage of construction materials and vehicles at the material time, he failed to give evidence or explanation of how the disposed vehicles, scattered on the Suit Land and not parked properly, came to be allowed to be stored in the Suit Land.  The Judge considered that if the disposed vehicles were owned by someone else (ie not owned by the Plaintiff or his related companies), the Plaintiff ought to have no difficulty in giving evidence concerning the ownership of the disposed vehicles if, as the Plaintiff alleged, he had exclusive possession and control of the Suit Land.  In this regard, it is of note that in cross-examination, the Plaintiff accepted that, as a matter of fact, some vehicles not belonging to, or connected with, the Plaintiff or his related companies were able to park inside the Suit Land (問: 咁我亦都向你指出喇, 就係話實際上喇, 其實係喺涉案嘅土地, 係有其他車可以泊到入去, 而唔係屬於你哋胡氏家族或者Pepmore[27]或者胡氏成豐, 你同意嗎? 答: 同意)[28].

(3)  The Plaintiff next argues that the finding by the Judge that he “never said that these disposed vehicles were owned by P or his related companies” is contrary to the Plaintiff’s evidence at §§12 and 16 of his 1^st witness statement.  This complaint is unsustainable because there is nothing in those paragraphs of the Plaintiff’s 1^st witness statement to suggest that the disposed vehicles were owned by the Plaintiff or his related companies.

(4)  Finally, the Plaintiff argues that “it defies logic for the Court to have held that the law requires the driveway inside the Suit Land has to be built by the Plaintiff”.  This argument is without foundation for the simple reason that the Judge did not so hold.

GROUND 5 - JUDGE ERRED IN RELYING UPON SUPPOSITION WHICH IS SPECULATION, IRRELEVANT, UNSUPPORTED BY EVIDENCE AND/OR CONTRADICTED BY EXPERT EVIDENCE

43.Four matters are relied upon by the Plaintiff under this ground[29]:

(1)  The first matter concerns the identity of the person who placed the unidentified objects at the Southern Entrance to the Suit Land seen in the aerial photo taken on 4 March 2004.  As earlier noted, the Judge accepted the submission of counsel for the Defendants that the unidentified objects were highly likely to have been placed by Kwong in view of the fact that she commenced the Possession Actions to recover (part of) the Suit Land in 2004.  The Plaintiff argued that there was no evidence before the Judge as to who placed the unidentified objects at the Southern Entrance, and it was not permissible for the Judge to speculate that it was Kwong who did so.  We consider that there is some validity in the Plaintiff’s complaint that, on the evidence before the Judge, it was not open to him to come to the view that it was, or was highly likely to be, Kwong who placed the unidentified objects at the Southern Entrance.  However, the important point is not who caused the obstruction at the Southern Entrance, but why the Plaintiff would permit such obstruction to occur if, as he alleged, he had exclusive control of the Suit Land or used it for open storage of construction materials and vehicles at the material time.  As pointed out by the Judge, the Plaintiff gave no explanation as to why the entrance was suddenly blocked.

(2)  The Plaintiff also relies on the fact that in the Defendants’ expert report, there was reference to a gate “found on the southern boundary of [Lot 340]”[30]. It should be noted, however, that the Judge did not make any finding about this “gate” in the Judgment.  On the other hand, in his Decision refusing to grant leave to appeal dated 22 October 2019, at §25, the Judge pointed out that the “gate” was at the southern boundary of Lot 340, not the Southern Entrance.  Anyhow, it is not the Plaintiff’s case or evidence that he ever erected any gate at the Southern Entrance to the Suit Land.

(3)  The second and third matters concern the Judge’s findings that (i) the Defendants entered into and inspected the Suit Land freely without any interference from the Plaintiff in October 2012 to September 2013, and (ii) the 1^st Defendant’s photographer likewise freely entered into the Suit Land to take photographs without any interference from the Plaintiff in October 2013.  The Plaintiff argues that these entries into the Suit Land is irrelevant because they took place more than 12 years after the Plaintiff first commenced adverse possession of the Suit Land in 1994.  The Judge was fully alive to the point that the entry into the Suit Land by the photographer in October 2013 might not be relevant to the Plaintiff’s adverse possession claim because it took place after 2006 (see §52 of the Judgment). Although the Judge did not expressly refer to the entries into the Suit Land by the Defendants in October 2012 to September 2013 in §§52 and 53 of the Judgment, we do not believe that the Judge treated the entries by the Defendants differently.

(4)  The fourth matter concerns the identity of the person who gave instruction for the preparation of the Private Surveyor Report dated March 2012.  Again, the Plaintiff argues that it was speculative of the Judge to take the view that the survey works were carried out either by Kwong or by someone with her permission.  As in relation to the issue of the identity of the person who caused the obstruction at the Southern Entrance in 2004 mentioned above, it was not the Plaintiff’s case that the survey was carried out by him or on his behalf.  The question naturally arises as to how the surveyor was able to gain access into the Suit Land to carry out the survey if, as alleged by the Plaintiff, the Suit Land was under his exclusive possession and control at the material time.  No explanation on this matter was given by the Plaintiff at the trial.  The fact that the private survey took place after 2006 and therefore might not be relevant to the Plaintiff’s case was expressly recognised by the Judge[31].

GROUND 6 - JUDGE ERRED IN MAKING FINDINGS WHICH ARE DIRECTLY CONTRADICTED BY UNCHALLENGED EXPERT EVIDENCE

44.Under this ground, the Plaintiff argues that the Judge’s finding at §41 of the Judgment that “the Plaintiff has not done his best to exclude the world at large” because “there is an opening in the Suit Land namely the Southern Entrance without any metal chain, any kind of barrier” is plainly wrong in view of, inter alia, the following matters:

(1)  the gate at the southern boundary of Lot 340 referred to in the Defendant’s expert report;

(2)  the aerial photo of 4 March 2004 further supported the Plaintiff’s case that a metal chain was installed at the Southern Entrance; and

(3)  in the light of the nature and size of the Suit Land, the Judge should have held that complete enclosure of the Suit Land was not necessary[32].

45.We have already dealt with the “gate” referred to in the Defendant’s expert report in §43(2) above.  The Judge’s observation that there was an opening in the Suit Land without any metal chain, barrier or warning signboard was with reference to the Southern Entrance, not the southern boundary of Lot 340.  The large, unguarded, opening at the Southern Entrance can clearly be seen in the aerial photo taken on 4 March 2004.  On the other hand, that aerial photo, so far as one can see, does not show the metal chain, or support the Plaintiff’s evidence regarding the installation of the metal chain.  For the reasons given in §§24-31 of the Judgment, we consider that the Judge was entitled to reject the Plaintiff’s evidence concerning the metal chain.  Lastly, as regards the argument that complete enclosure of the Suit Land was not necessary having regard to the nature and size of the Suit Land, the Judge never held that it was necessary for the Plaintiff to completely enclose the Suit Land before he could successfully establish the adverse possession claim.  The Judge looked for other indicia of control such as barrier and warning signboard, but found nothing of that sort at the Southern Entrance such that outsiders could freely access the Suit Land at any time.

GROUND 7 - CHAN SAN V HANS LI [2019] HKCFI 714

46.Under this ground, the Plaintiff contends that the Judge “erred in law in wrongly applying the decision of Chan San… The Plaintiff’s case is that the ‘road/track’ being subject to the Plaintiff’s exclusive use is only one factor in favour of the Plaintiff’s claim for adverse possession to the Suit Land … As such, the Judge’s finding that the enjoyment of the ‘road/track’ was not exclusive to the Plaintiff is insufficient to dismiss the Plaintiff’s claim.  This is because the facts in Chan San are clearly different.”[33]

47.This ground can be disposed of shortly, because it is rested upon the false premise that the Judge dismissed the Plaintiff’s claim based on his finding that the road/track was not for the exclusive use or enjoyment of the Plaintiff.  The circumstances in which the issue concerning the road/track arose in the trial have been explained in §29(2) above.  The finding that the road/track was not for the Plaintiff’s exclusive use or enjoyment was one of the matters taken into account by the Judge in reaching his ultimate conclusion that the Plaintiff had failed to establish his adverse possession claim.  There is nothing in the Judgment, in particular §§32-37 thereof, to suggest that the Judge considered that such finding was by itself sufficient to dismiss the Plaintiff’s claim.  Whether the Judge should have distinguished Chan San on the facts is neither here nor there.

48.In conclusion, all 7 grounds of appeal are rejected.

RESPONDENT’S NOTICE

49.Having reached the above conclusion, it is not necessary for us to deal with the issue raised in the Respondents’ Notice as regards the effect of the Possession Orders, or the question of whether the Plaintiff should have applied to join as a party in the Possession Actions and set aside the Possession Orders instead of commencing a separate action to claim adverse possession of the Suit Land against the Defendants.

DISPOSITION

50.The Plaintiff’s appeal is dismissed with costs to the Defendants, to be taxed if not agreed.

Mr Erik Shum & Mr Adrian Leung, instructed by Wong, Hui & Co., for the Plaintiff

Mr Roy Lau, instructed by Lam, Lee & Lai, for the 1^st and 2^nd Defendants