Ng Chun Sang also known as Ng Chung Sung and Another v. Persons in Occupation of Lot No. 544 and The Remaining Portion of Lot No. 539 Both in Demarcation District No. 77 and Another

CAMP 476/2021

[2022] HKCA 324

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 476 OF 2021

(ON AN INTENDED APPEAL FROM DCCJ NO 3463 OF 2018)

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Before: Hon Barma and G Lam JJA in Court

Date of Written Submissions: 21 October 2021 & 17 January 2022

Date of Decision: 24 February 2022

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D E C I S I O N

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Hon G Lam JA (giving the Decision of the Court):

Introduction

1.The judge below (Judge Kent Yee) granted summary judgment in favour of the plaintiffs and struck out the 2^nd defendant’s counterclaim at a hearing at which the 2^nd defendant was absent.  On the subsequent application by the 2^nd defendant, the judge set aside his earlier order, on the ground that she had not received notice of the applications or the hearing.  From this decision the plaintiffs now seek leave to appeal, having failed to obtain leave from the judge.

Background

2.The plaintiffs are the co-owners of two pieces of land, namely, Lot No 544 and the Remaining Portion of Lot No 539, both in D. D. No. 77, Fanling.  I shall refer to them as Lot 544 and Lot 539 RP respectively and together as “the Lots”.  The plaintiffs allege that the 1^st defendant (named as persons in occupation of the Lots) and the 2^nd defendant have been occupying the Lots, and bungalows have been built on the Lots, without the plaintiff’s’ permission or consent.  The plaintiffs brought an action in the District Court to recover the land, claiming in addition injunctive relief and damages.

3.The plaintiffs also applied by summons for an interlocutory mandatory injunction to require the defendants to remove “illegal structures” from the Lots.  In an affirmation of November 2018, the 2^nd defendant, giving an address of “10G2A8, Ng Chaw South Road, Ping Che Village, Fanling”, opposed the application on the ground that she had been in adverse possession of a house or shed which occupied part of Lot 544.  She said that when she moved into an abandoned shed there in around 2005, she was told by a relative who lived in that village that it did not belong to anyone.  She fixed the existing fence and also renovated the shed.  She began living there, at first by herself, and since 2011, with her second husband, and since 2016, with their child.  On 27 November 2018, Judge M K Liu dismissed the plaintiffs’ application for interlocutory injunction.[1]

4.In December 2018, the 2^nd defendant filed her defence and counterclaim (signed by counsel), with an annexed map showing that part of Lot 544 of which she claimed adverse possession.

5.In March 2020, the 2^nd defendant filed a notice to act in person (“Notice”) stating that her address for service is “Lot no. 44, Demarcation District No. 77, New Territories, Hong Kong”.  The 2^nd defendant has subsequently explained that the Notice was prepared by her former solicitors who made a mistake in stating the Lot number to be “44” instead of “544”.  The plaintiffs have not disputed this evidence.  I shall refer to the address in the Notice as the “Mistaken Address”.

6.In May 2020, the plaintiffs filed a summons for summary judgment against the 2^nd defendant together with supporting affirmations.  The summons was returnable on 9 July 2020 at 9:30 am before the judge with a time estimate of 15 minutes.

7.The steps taken for service of the summons and affirmations on the 2^nd defendant are as follows:

(1)  On 5 June 2020, a clerk of the plaintiffs’ solicitors put the documents “inside underneath the door of a room in Lot No. 544 …  The said room was pointed out to [the clerk] by a male in the vicinity who told [her] that the 2^nd Defendant lived in that room”.  These documents had not been returned to the plaintiffs’ solicitors.

(2)  On 9 June 2020, the clerk posted the documents in a sealed envelope addressed to the 2^nd defendant at “Lot No. 539RP and Lot No. 544 in DD77, New Territories, Hong Kong” by ordinary post.  This envelope has not been returned undelivered.

(3)  On 9 June 2020, the clerk posted the documents in another sealed envelope addressed to the 2^nd defendant at the Mistaken Address by ordinary post.  This envelope was returned undelivered by the post office to the plaintiffs’ solicitors shortly after 17 June 2020 with the remark “Incomplete address / No such address”.

8.At the return date of the summons on 9 July 2020, the 2^nd defendant did not appear in court.  The judge gave directions for her to file and serve an affirmation in opposition within 14 days and adjourned the summons to 5 August 2020 at 10:30 am for hearing with an estimate of 1 hour. 

9.On 13 July 2020, another clerk of the plaintiffs’ solicitors delivered a copy of the draft order of 9 July 2020 by placing it “inside underneath the door of a room in Lot No. 544 …  The said room had been identified by a male in the vicinity who told [her] that the 2^nd Defendant lived in that room”.

10.Also on 13 July 2020, the plaintiffs filed a further summons seeking an order to strike out the 2^nd defendant’s counterclaim on the ground that it was frivolous and vexatious.  The summons was also returnable on 5 August 2020.  On 23 July 2020, a clerk of the plaintiffs’ solicitors placed the summons “inside underneath the door of a room in Lot No. 544 …  which had been identified by a male in the vicinity that the 2^nd Defendant lived in that room”. 

11.At the hearing of the two summonses on 5 August 2020, the 2^nd defendant did not appear.  The hearing proceeded and in the result the judge granted summary judgment and struck out the counterclaim.[2]

12.According to the 2^nd defendant, she only discovered the orders after the plaintiffs began taking steps to enforce the judgment.  She immediately filed a summons for stay of execution and later another summons for an order to set aside the judge’s decision of 5 August 2020.  She filed affirmations saying that she did not appear in court on 5 August 2020 because she had never received notice of the plaintiffs’ applications or the summonses, supporting affirmations and the order of 9 July 2020.

The judge’s decision

13.After a directions hearing on 5 February 2021, the judge decided on 21 April 2021, based on the parties’ written submissions, to set aside his orders of 5 August 2020.[3]  He later refused leave to appeal.[4]  Focusing on the service of the documents, the judge held:

(1)  The documents placed at the door by the clerks on 5 June, 13 July and 23 July 2020 were not properly served because, according to the unchallenged evidence of the 2^nd defendant and her neighbour, Ms Lai, that door was not the 2^nd defendant’s door but the door to Ms Lai’s house which stood on Lot No 545.  Ms Lai had picked up the documents in question and thrown them away without notice to the 2^nd defendant with whom she was not acquainted at that time.

(2)  The documents sent on 9 June 2020 to the Mistaken Address were not properly served as it was obvious that that address was unreliable and could not be a proper address for service.

(3)  The documents sent by ordinary post on 9 June 2020 to “Lot No. 539RP and Lot No. 544 in DD77, New Territories, Hong Kong” were not properly served because the 2^nd defendant lived in only part of Lot 544 and there were other structures in the same lot.  The Lots alone cannot be a proper address for service.

14.The judge declined the plaintiffs’ invitation for him to consider the merits of the defence because the judgment obtained was in his view irregular and liable to be set aside ex debito justitiae.

The intended grounds of appeal

15.The plaintiffs seek leave to appeal based on three intended grounds of appeal:

(1)  Only ordinary service (as opposed to personal service) of the documents was required.  The test for ordinary service is not whether the 2^nd defendant received notice or had actual knowledge. There had been proper service on the 2^nd defendant, who had given a wrong address by the Notice, for which the responsibility lay with her. 

(2)  Alternatively, by virtue of Order 65 rule 9, the plaintiffs were not required to serve the papers on the 2^nd defendant at all, because the 2^nd defendant had provided no proper address for service, so that she fell within the phrase “has no address for service” in rule 9.

(3)  Even if the summary judgment obtained was irregular, the judge should have, after setting it aside, considered the merits of the application for summary judgment on an inter partes basis, given that both parties were then represented and the 2^nd defendant had by counsel said she would not file evidence for opposing that summons.

16.Having considered the available materials, we consider it appropriate to determine the application for leave without a hearing, on the basis of the submissions in the parties’ written statements for the application.

Ground 1

17.So far as the summary judgment is concerned, the application to set it aside is based on Order 14 rule 11 of the Rules of the District Court (Cap 336H) (“RDC”), which provides:

“ Any judgment given against a party who does not appear at the hearing of an application under rule 1 or 5 may be set aside or varied by the Court on such terms as it thinks just.”

18.The first question on which the court’s approach to an application to set aside depends is whether the judgment was regular or irregular.  The judge proceeded on the basis that if the judgment was irregular, the 2^nd defendant is entitled as of right to have it set aside.  This is also the position in the case of setting aside default judgments under Order 13 rule 9, although there is a residual discretion for the court to decline to set aside an irregular default judgment or to impose terms when setting it aside.  There is no ground of appeal advanced against the approach adopted by the judge.

19.There is no dispute that service of the documents in question is governed by RDC Order 65 rule 5, which provides:

“ (1) Service of any document, not being a document which by virtue of any provision of these Rules is required to be served personally or a document to which Order 10, rule 1, applies, may be effected—

(a) by leaving the document at the proper address of the person to be served; or

(b) by post …”

20.As stated above, the plaintiffs have adopted 3 modes of service.  The first mode of service at the site by the clerks can be quickly dismissed because there is unchallenged evidence that they had placed the documents at Ms Lai’s door rather than the 2^nd defendant’s door.  It follows that the documents had not been left at the proper address of the 2^nd defendant within the meaning of Order 65 rule 5(1)(a).  This also means there had never been any proper service of the order dated 9 July 2020 containing the date of the resumed hearing on 5 August 2020 as it was only purportedly served by this means.  On this ground alone the judge was quite entitled to think that the 2^nd defendant had not been given notice of the time appointed for the resumed hearing within the meaning of Order 32 rule 5(2).

21.Secondly, as for the documents sent by post on 9 June 2020 to the Mistaken Address, plainly this did not constitute valid service because the envelope was returned undelivered by the post office.  As stated in Hong Kong Civil Procedure 2022, para 65/5/4, it is when a document “has been properly addressed, prepaid and posted to the proper address of the person to be served and not returned by the post office” that there is prima facie evidence that it has been duly delivered in the ordinary course of post.  The presumption of service under section 8 of the Interpretation and General Clauses Ordinance (Cap 1) was rebutted when the envelope was returned undelivered.

22.For this purpose, it does not matter that the address contained an error due to the fault of the 2^nd defendant or her former solicitors, for it does not alter the fact that the envelope was returned undelivered.  The plaintiffs have referred to a number of cases for the argument that where a document has been served on a party at an address provided by that party for service, then he cannot complain if he has not received it and a judgment entered against him is not thereby rendered irregular: Morigood Development Ltd v Sunny Trading Co (a firm) [1999] 2 HKC 710; Thomson v Jeans & another [2006] 3 HKLRD 307; Venetian Macau Ltd v Lai Choi Fat [2020] HKDC 430.  These are not, however, cases in which a document is posted to the address provided but returned undelivered, and we do not think that the same principle can be extended to this situation.

23.The plaintiffs have also referred to a number of Court of Appeal decisions in non-refoulement cases stressing that it is the duty of a litigant to give the court an address to which correspondence and notice can come to his attention in a timely manner: see e.g. Re Zaheer [2020] HKCA 880.  It does not however follow that the court will regard a document as having been validly served on a party by post even though it has been returned undelivered by the post office.

24.Thirdly, as regards the documents sent by ordinary post addressed to “Lot No. 539RP and Lot No. 544 in DD77, New Territories, Hong Kong”, this is not valid service either because the address was neither the address given by the 2^nd defendant for service nor her “last known postal address” within the meaning of section 8 of the Interpretation and General Clauses Ordinance.  As the judge noted, that address comprises the Lots claimed in the action, and as the plaintiffs well knew, the 2^nd defendant only claimed adverse possession of part of Lot 544, and there were other structures on Lot 544 not occupied by her.  In so far as the plaintiffs believed that the address stated in the 2^nd defendant’s Notice was incorrect, they could have found her last known address in her affirmation made in November 2018 in opposition to the injunction application (see §3 above).  Inexplicably, instead of using that address, the plaintiffs chose to post the envelope to an unnecessarily wide address.

25.There is therefore no merit in Ground 1.

26.Neither party has addressed separately the setting aside of the order for striking out.  Strictly speaking Order 14 rule 11 does not apply to it.  Since the summons for striking out was only purportedly served by hand on 23 July 2020 but was again placed under the wrong door, there was no service or notice given to the 2^nd defendant.  It follows that the order may properly be treated as having been obtained ex parte, and may as such be set aside by the court under Order 32 rule 6, on the ground that it should not have been made without giving the 2^nd defendant an opportunity to be heard. 

Ground 2

27.RDC Order 65 rule 9 provides as follows:

“ Where by virtue of these Rules any document is required to be served on any person but it is not required to be served personally or in accordance with Order 10, rule 1(2), and at the time when service is to be effected that person is in default as to acknowledgment of service or has no address for service, the document need not be served on that person unless the Court otherwise directs or any of these Rules otherwise provides.”

28.The plaintiffs argue that the phrase “has no address for service” in rule 9 must include the situation where the person “has no proper address for service”, and that since the address stated in the Notice was not a valid address, rule 9 applies and service of the documents in question on the 2^nd defendant was not required.

29.We do not accept that service was not required. As rule 9 itself makes clear, it is subject to the provisions of other rules. Order 65 rule 5(2) provides:

“ (2) For the purposes of this rule, and of section 8 of the Interpretation and General Clauses Ordinance (Cap. 1), in its application to this rule, the proper address of any person on whom a document is to be served in accordance with this rule shall be the address for service of that person, but if at the time when service is effected that person has no address for service his proper address for the purposes aforesaid shall be—

…

(b) in the case of an individual, his usual or last known address …”

30.Assuming this is a case where the 2^nd defendant “has no address for service” because the address given for service was not valid, then according to rule 5(2) her proper address for the purpose of service under rule 5(1) is her usual or last known address.  As the judge pointed out in his decision refusing leave to appeal, there is such an address stated in the 2^nd defendant’s affirmation filed in November 2018, which the plaintiffs have apparently ignored.

Ground 3

31.There is no substance in this Ground, which essentially says that having set aside the summary judgment, the judge ought to have considered the merits of the plaintiffs’ application for summary judgment.  First, the draft notice of appeal is wrong in saying that the practical outcome is that the plaintiffs’ summons for summary judgment was dismissed.  The judge made no such order.  With summary judgment having been set aside under Order 14 rule 11 for lack of service, the plaintiffs’ summons remains extant and it is for them to consider whether to pursue it. Secondly, whether the judge should have gone on, after setting aside the judgment, to give directions on how the plaintiffs’ summons should be dealt with is a matter of case management.  It should be noted that the judge’s decision was handed down based on written submissions, rather than delivered ex tempore at the end of an oral hearing.  The plaintiffs have not come near to establishing any proper ground for challenging a decision of this type.  Thirdly, the plaintiffs are incorrect in saying that the 2^nd defendant had indicated that she would not file any evidence in opposition to the application for summary judgment.  What was said by counsel on her behalf at the directions hearing on 5 February 2021, which was the first return date of the 2^nd defendant’s summons for setting aside the previous order, was said in the context of that application.

Conclusion

32.For these reasons, we are not satisfied that the intended appeal has a reasonable prospect of success or that there is any other reason in the interests of justice why the appeal should be heard, being the conditions for granting leave under section 63A(2) of the District Court Ordinance (Cap 336).  The plaintiffs’ application for leave to appeal is therefore dismissed with costs summarily assessed in the sum of $79,600.

33.Since the application is in our view totally without merit, we make an order under Order 59 rule 2A(8) of the Rules of the High Court (Cap 4A) that no party may under rule 2A(7) request that the determination be reconsidered at an oral hearing inter partes.

Written Submissions by Mr Simon So, instructed by Chan & Associates, for the 1^st & 2^nd Plaintiffs

Written Submissions by Mr Solomon Lam, instructed by KCL & Partners, for the 2^nd Defendant