Chan Wai Yee v. Kwong Wai Piu, By His Guardian Ad Litem Kwong Ping Kuen

HCA 1206/2015

[2022] HKCFI 3055

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1206 OF 2015

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BETWEEN

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Before:  Hon K Yeung J in Court

Date of Hearing:  30 August and 2 September 2022

Date of Judgment:  6 October 2022

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J U D G M E N T

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A. Introduction

1.This is the retrial of the claim by the plaintiff (“P”)  for declarations of possessory title in respect of a residential unit at 5/F, No.64 Percival Street, Happy Mansion, Nos. 13, 15, 17 & 19, Lee Garden Road and Nos. 62, 64, 66 & 68 Percival Street, Hong Kong (the “Property”).  The claim is based on the doctrine of adverse possession, and sections 7(2) and 17 of the Limitation Ordinance Cap 347 (“LO”).

2.Mr Sunny Chan appeared for P.  Mr Patrick Siu appeared for the defendant (“D”).

B.  The Property

3.The Property is a residential unit within a building on Percival Street/Lee Garden (the “Building”).  The Building was constructed in the 1960’s.

4.According to the land search records[1]:

(a)  Chu Kwok Choy entered into an Agreement for Sale and Purchase of 27 March 1962 for the purchase of the Property, who as trustee assigned the same via a “Deed of Trust by Chu Kwok Choy” of the same date[2] to Madam Kwong Wong Chun (or Gine)  as beneficiary.  Madam Kwong Wong Chun was D’s mother (“D’s Mother”);

(b)  A number of building orders have over the years been registered against the Property:

(i)  one dated 8 September 1995 under section 26 of the Buildings Ordinance Cap 123 (“Cap 123”)  and registered on 22 November 1995 via Memorial UB6450845)  (“BO/1”);

(ii)  one dated 9 November 1995 under sections 26 and 28(3)  of Cap 123 (registered on 30 January 1996 via Memorial UB6514486)  (“BO/2”).  BO/2 superseded BO/1;

(iii)  one dated 9 July 2003 under section 28(3)  of Cap 123 “re: common drains” (registered on 14 November 2003 via Memorial UB9053170)  (“BO/3”);

(iv)  one dated 16 March 2004 under section 26 of Cap 123 “for common area and exterior of the building” (registered on 28 May 2004 via Memorial UB9230488)  (“BO/4”);

(v)  one dated 31 August 2004 under section 28(3)  of Cap 123 “for external common areas of building” (registered on 23 September 2004 via Memorial UB9334166)  (“BO/5”).  BO/5 supplemented BO/3;

(vi)  one dated also 31 August 2004 under section 26 of Cap 123 “re: common parts of exterior & interior of the bldg.” (registered on 3 November 2004 via Memorial UB9370574)  (“BO/6”).  BO/6 supplemented BO/4;

(vii)  one dated 23 June 2005 under section 24(1)  of the Cap 123 “for common part(s)  only” (registered on 15 August 2005 via Memorial 05081500740098)  (“BO/7”);

(viii)  one dated 31 May 2005 under section 28(3)  of Cap 123 “for external areas and common areas” (registered on 10 September 2009 via Memorial 09091000320126)  (“BO/8”).  BO/8 superseded BO/5;

(ix)  one dated also 31 May 2005 under section 26 of Cap 123 “for common areas and exterior of the building” (registered on 10 September 2009 via Memorial 09091000920072)  (“BO/9”).  BO/9 superseded BO/6; and

(x)  one dated also 10 December 2010 under section 24(1)  of Cap 123 “re common part only” (registered on 20 March 2013 via Memorial 13032002770449)  (“BO/10”).

(c)  9 letters of compliance and 1 memorial of satisfaction have also been registered in favor of the Building between 1996 and 2011;

(d)  Whilst those building orders are not amongst the trial bundle, one notes that at least BO/2 (November 1995), BO/3 (July 2003), BO/4 (March 2004), BO/7 (June 2005), BO/8 (May 2005), BO/9 (May 2005)  and BO/10 (December 2010)  have never been superseded, and judging from the letters of compliance, mostly complied with.

C.  The relevant parties

5.On P’s side:

(a)  P was a daughter of Mr Chan Hau Ching (also known as Chan Ching, “P’s Father” or “her Father”)  and Madam Ng Oi Pang (“P’s Mother” or “her Mother”);

(b)  P’s siblings are Chan Wai Ching (eldest sister), Chan Wai Ling (younger sister)  and Chan Fat Wing (youngest brother);

(c)  P’s Father passed away in June 2005.  P’s Mother passed away in February 2012.

6.On D’s side:

(a)  D was born in 1944.  He was the only son of Mr Kwong Wah (“D’s Father”)  and D’s Mother;

(b)  D’s Father died in 1967 in Thailand;

(c)  As a result of the Deed of Trust by Chu Kwok Choy mentioned above, D’s Mother has become the registered owner of the Property.  She died in 1974;

(d)  In 2015, D applied for the administration of the estate of D’s Mother (the “Estate”).  Letters of Administration was granted to him on 18 October 2017;

(e)  On 6 and 10 May 2022, D was examined separately by 2 specialists in psychiatry.  According to the medical certificates[3], D was not able to communicate through either verbal or nonverbal means.  He could not follow simple instructions.  Both specialists found that D was, by reason of mental incapacity as defined in the Mental Health Ordinance Cap 136, incapable of managing and administering his property and affairs, and that his prognosis is poor in terms of mental recovery;

(f)  Kwong Ping Kuen (“Kwong PK”)  is D’s cousin.  On 26 July 2022, upon his application, he was appointed D’s guardian ad litem.

D.  Procedural history

7.The Writ herein was issued on 1 June 2015.  At that stage, D’s Mother was the only named defendant.

8.On 18 October 2017, D was granted letters of administration of D’s Mother’s estate.

9.As it happened, on that very same date, and upon a trial of the present action in the absent of any attendance on behalf of D’s Mother, Deputy Judge Kent Yee granted P judgment (the “2017 Judgment”).

10.On 17 January 2018, upon the application by D as the administrator of the Estate, Deputy Judge Kent Yee set aside the 2017 Judgment, and granted D leave to be substituted in that capacity as the defendant.

11.The “inter partes” trial of the action then took place before Deputy Judge To in mid-2020.  On 31 July 2020, the learned Deputy Judge handed down his Judgment in favour of D. 

12.P appealed.  The hearing took place before the Court of Appeal on 15 February 2022.  At the conclusion of the hearing, the Court of Appeal allowed P’s appeal, and remitted the case back to the Court of First Instance for re-trial before another judge.  The Reasons for Judgment and Decision on Costs was handed down on 1 March 2022[4] (the “Court of Appeal Judgment”).

13.Pursuant to the order for retrial, the parties now come before this Court for trial, with Kwong PK having been appointed the guardian ad litem of D.

E.  Parties’ pleaded case

14.P’s case as pleaded in the Amended Statement of Claim (“ASOC”)  is as follows.  Since around 1968, P and/or her family have been in exclusive possession of the Property.  The nature of the possession has changed over the years.  From the beginning till 1980, their possession was pursuant to various tenancy agreements which P’s Father and D had entered into.  Rent had been paid therefor.  The last tenancy agreement so entered into was dated 19 March 1980 for a term of 2 months from 15 February to 14 April 1980.  Upon the termination of that last tenancy, no one has visited the Property for rent. Various alleged acts of occupation, exclusive possession and use of the Property have been pleaded (including actual occupation of the Property as P’s and P’s family’s dwelling, renovation of the Property, change of the lock on the front door, payment of various utilities, taking of steps in compliance with a building order, and participation in the business of the incorporated owners of the Building).  It is then pleaded at §27 that: 

“By reason of the open, uninterrupted and exclusive use, occupation and possession of the Property by [P] whether by herself or through [P’s] Father since 15^th April 1980, which was adverse to [D] and/or his predecessors-in-title, and by reason of the matters pleaded in the foregoing and the operation of Sections 7(2)  and 17 of the [LO], [P] has either by herself or through [P’s] Father acquired all the title, rights, benefits and interests, including the right to exclusive physical occupation of and in the Property.”

15.D’s Defence and Counterclaim (“DAC”)  is dated 21 February 2018:

(a)  He does not dispute the occupation of the Property by P’s Father and his family between 1968 and 1980.  He also accepts that since about 1980, he has not collected any rent from P or her family for the occupation of the same.  His case is that the occupation has throughout been with consent given by him on behalf of D’s Mother, the Estate or himself;

(b)  Initially till about 1980, there were tenancies between him and P’s Father.  The rent was HK$250 per month;

(c)  Subsequently, there were two oral agreements, both entered into between him and P’s Father, the first one in about 1980 (the “1^st Oral Agreement”), and the 2^nd one in about 1995 (the “2^nd Oral Agreement”, and collectively the “Oral Agreements”), that:

(i)  In around 1980, P’s Father requested D to renovate the Property, which works included making alterations to the balcony and the flooring therein.  The estimated renovation expenses were HK$36,000.  D did not have enough money to do so.  They therefore entered into the 1^st Oral Agreement.  P’s Father agreed to carry out the renovation and bear the costs.  D in return would let P’s Father and his family live in the Property rent-free for 15 years. In around 1983, D attended the Property and noted the renovation which P’s Father had carried out;

(ii)  In about 1995, around the time when the 1^st Oral Agreement was coming to an end, D received from the Buildings Department an order to repair the outer walls and windows of the Property.  D went to the Property to inform P’s Father that after the lapse of the 15 years of rent-free period, he would like to increase the rent to HK$350.  P’s Father did not agree.  D and P’s Father then entered into the 2^nd Oral Agreement. P’s Father agreed to be responsible for carrying out the repair works required by the building order.  The costs were agreed to be HK$45,000.  In return D would let P’s Father and his family live in the Property rent-free for another 15 years.  In around 1996 when D went up to the Property, P’s Father told him that the building order had been complied with;

(d)  In around 2011, D went up to the Property once to look for P’s Mother, “but to no avail”[5];

(e)  Sometime in 2013, D went up to the Property to look for P’s Mother, “but again to no avail”[6];

(f)  D has at all material times also been paying for the rates and property tax of the Property;

(g)  The occupation was therefore by consent.  D therefore denies that P is entitled to the relief sought;

(h)  On the same factual basis, D counterclaims for possession and damages (mesne profits).

16.In respect of D’s pleaded case, I note and record 2 matters:

(a)  At various places of the DAC, it has been pleaded that certain consents given by D were given on behalf of D’s Mother, the Estate, or himself as the sole beneficiary of the Estate.  Mr Siu in the course of his opening accepted that before any grant, D could not have acted on behalf of the Estate or himself as the beneficiary.  The consents given, he submitted, would nonetheless go to the state of mind of the occupiers;

(b)  In the DAC, there is an alternative plea[7], that:

“Alternatively, even if [P’s] Father has somehow been an adverse possessor, [P] occupied and resided in the Property only pursuant to a licence granted by [P’s] Father and subsequently a license granted by [P’s] Mother.”

In the course of his oral opening, Mr Siu informed this Court that he accepted the principles relating to successive squatters, and that that alternative plea would no longer be pursued.

17.P filed her Reply and Defence to Counterclaim on 22 March 2018 (“R&DC”). D’s DAC are mostly not admitted or denied.  Specifically, P avers that:

(a)  She and her Father attempted to contact D between April 1980 and 1983 via telephone, correspondence and other means including placing an advertisement in Sing Tao Newspaper on 15 to 17 August 1980, but with no success[8];

(b)  The balcony of the Property had already been altered by 1968, and no renovation work was carried out in the Property in 1980[9];

(c)  D had never after the last renewal of the lease visited the Property, or made contact with P, her Mother or Father[10];

(d)  P’s Father in about 1975, 1994 and 2000 suffered from three strokes, which seriously limited his physical movement[11];

(e)  P’s Mother suffered from depression and dementia in about 2005 and did not talk to anybody[12].

F.  The witnesses

18.For P, she is the only witness for herself.  She has given one statement of 19 October 2018 (“P/WS”).

19.For D:

(a)  In respect of D:

(i)  D has become mentally incapacitated.  Kwong PK has been appointed his guardian ad litem.  D has not been called;

(ii)  D has previously given:

(1)  an affirmation of 5 December 2017 (in support of his application as the administrator of the Estate to be substituted as the defendant herein, and for an order that the 2017 Judgment be set aside, (“D/Aff 3”),

(2)  In D/Aff 3, D refers to and exhibits 2 earlier affirmations which he has filed in support of his application for grant (“D/Aff 1” and D/Aff 2”), and

(3)  a witness statement of 18 October 2018 (“D/WS”);

(iii)  On 28 July 2022, a hearsay notice was filed in relation to D/WS[13];

(iv)  Both in respect of D/WS and D/Aff 3 (including the earlier ones exhibited), despite the fact that the hearsay notice covers only D/WS, Mr Chan in the course of his opening indicated the that admissibility of D/WS, D/Aff 3 and the 2 previous affirmations would not be objected to.  The issue is only one of weight.

(b)  Kwong PK has been called.  He has given one witness statement of 18 October 2018 (“Kwong PK/WS”).  He was called, not in relation to his appointment as the guardian ad litem, but as a factual witness in purported support of D’s case.

F.  The leases / receipts

20.The authenticity of all documents in the trial bundle is not in dispute.

21.P and her family first rented from D the Property in April 1968.  They then started to live there[14].

22.P used to attend the Property monthly to collect rent, in the monthly amount of HKS150.  A bundle of some 120 written leases or receipts (“Receipts”)  have been produced[15]:

(a)  They are dated between 15 April 1968 and 19 March 1980;

(b)  Most of the earlier ones (up to 1973)  have been stamped;

(c)  Counsel indicated in the course of their opening that no issue would be raised in relation to the stamping of the Receipts, or whether the lack of any stamping would affect admissibility;

(d)  Except several which are entirely handwritten, the Receipts are pro-forma leases/receipts that got filled in manually.  In respect of those pro-forma ones, they acknowledge receipt of rents (all except one for one month in the sum of HK$250), and contain some terms of the leases[16]. The handwritten ones are only receipts;

(e)  The first one (dated 15 April 1968, the “First Receipt”)  also bears some handwritten words stating an address at Bonham Strand and a telephone number.  D’s Mother is described therein as D’s aunt.  That address and telephone number were those of D at that time;

(f)  There is a separate receipt dated 28 April 1968 for lease deposit and electricity deposit in the respective sums of HK$250 and HK$100[17] (the “Deposit Receipt”);

(g)  The last one dated 19 March 1980 (the “Last Receipt”)  acknowledges receipt by D of 2 months’ rent in the total sum of HK$500 for the period from 15 February to 14 April 1980.

23.There is no more such leases or receipts beyond the period ended 14 April 1980.

24.D accepts that after 14 April 1980, no more rent has been received from P’s Father (or any one)  for the occupation of the Property.

G.  The issues

25.No agreed list of issues has been prepared.

26.Given the nature of P’s and her family’s occupation of the Property prior to 14 April 1980, there could have been no adverse possession of the Property between April 1968 and April 1980.  Time did not run during that period.  P does not seek to argue otherwise.

27.I note and record the following matters.  Mr Chan and Mr Siu have in their respective opening submissions dealt with the implications, in the context of the doctrine of adverse possession, of an occupier occupying the land under a tenancy, a tenancy-at-will, or a licence. In the course of their oral opening, both of them accepted that on the facts of parties’ pleaded cases, the legal niceties of the exact nature of the leases contained in or evidenced by the Receipts are not going to impact upon the outcome of this trial.  The bottom line is that if D is able to establish the existence of the Oral Agreements, the occupation by P’s Father, P and their family of the Property during the subsistence of the Oral Agreements would have been with consent, and would not have been adverse to the paper owner for the purpose of the doctrine of adverse possession.

28.The main factual dispute between the parties is hence the existence or otherwise of the 1^st and 2^nd Oral Agreements, which impacts directly upon the nature of P’s and her family’s occupation of the Property from 15 April 1980 onwards.

29.Mr Chan accepts that if this Court is to find that the 1^st and 2^nd Oral Agreements existed, so that P’s and her family’s occupation of the Property has been with D’s consent, that would be the end of P’s case.  If the 2^nd Oral Agreement had existed, the second 15-years period would only have ended in 2010, and the limitation period would not have expired by the time the Writ herein was taken out on 1 June 2015.

30.If this Court is to find against D in relation to the existence of the 1^st and 2^nd Oral Agreements, Mr Siu submits that this Court should still scrutinize the evidence adduced by P to decide whether the elements of adverse possession have been established.

31.I note and record the following matters.  In his written opening, Mr Chan has dealt with the possibility of the applicable limitation period in the present case being 12 instead of 20 years.  In the course of his oral opening, he accepted that on the facts of P’s case, there is no possible scenario of the results of this case being affected by the choice of limitation periods.  He further accepted in any event that P’s ASOC does not include any alternative plea based on the limitation period of 12 years[18]. He accepted therefore that this case should be proceeded with and adjudicated upon on the basis of the applicable limitation period being 20 years.

H.  The relevant legal principles

32.I have been cited a number of authorities which include Powell v McFarlane (1979)  38 P & CR 452 and Wong Tak Yue v Kung Kwok Wai & Anor (No 2)  (1997-98)  1 HKCFAR 55 at 68E to 70B, Chan Mei Lin and Others v Lee Hong [2018] HKCFI 2441 at §§74-77, and Cedric Hervey Ong v Wong Suk Lin [2018] HKCFI 2040 at §§48-62.  I may summarize the applicable principles as follows.

33.A person claiming adverse possession has to prove 2 elements: (i) physical possession or control; and (ii) the requisite intention to possess (animus possidendi).

34.Both factual possession and intention to possess are questions of fact which the party claiming possessory title has the onus of establishing.  In respect of the latter element, it may be a matter of inference from the objective conduct of physical possession such that the squatter has the intention to possess the land as of wrong.

35.In so far as the first element of physical possession or control is concerned, it entails a sufficient degree of factual possession in the sense of physical control.  As explained by Slade J in Powell v McFarlane at 470-471[47]:

“Factual possession signifies an appropriate degree of physical control. It must be a single and conclusive possession, though there can be a single possession exercised by or on behalf of several persons jointly. Thus an owner of land and a person intruding on that land without his consent cannot both be in possession of the land at the same time. The question what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances, in particular the nature of the land and the manner in which land of that nature is commonly used or enjoyed. In the case of open land, absolute physical control is normally impracticable, if only because it is generally impossible to secure every part of a boundary so as to prevent intrusion ... It is clearly settled that acts of possession done on parts of land to which a possessory title is sought may be evidence of possession of the whole. Whether or not acts of possession done on parts of an area establish title to the whole area must, however, be a matter of degree. It is impossible to generalise with any precision as to what acts will or will not suffice to evidence factual possession … Everything must depend on the particular circumstances, but broadly, I think what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no-one else has done so.”

36.Joint possession is permissible.  As observed by To J in Chan Mei Lin at §§76-77:

“76. In JA Pye (Oxford)  Ltd v Graham & another[19], Lord Hope referred to this unity as ‘exclusivity’ and said:

‘70. The general rule, which English law has derived from the Roman law, is that only one person can be in possession at any one time. Exclusivity is of the essence of possession. The same rule applies in cases where two or more persons are entitled to the enjoyment of property simultaneously. As between themselves they have separate rights, but as against everyone else they are in the position of a single owner.’

77.  Thus, two or more persons are in joint adverse possession of land belonging to another if they are in physical occupation of the land with the common intention that their possession shall be to the exclusion of everyone else including the paper owner, but not as between themselves.  They have effective control over the land as against the whole world.  As between themselves, they are entitled to the use and possession of any part of the land but cannot point to any part as his own to the exclusion of the other.  Joint possession is distinguishable from the case where one enjoys possession under the licence of the other who has exclusive right to possession.  The common example is the case of children enjoying possession of land under the licence of the father who is the person entitled to exclusive possession.”

37.In respect of the second element of animus possidendi, Li CJ summarized the law in Wong Tak Yue at 68E to 70B as follows:

“The principles for the application of these provisions are well established. A person claiming to be in adverse possession must be shown to have both possession and the requisite intention to possess. See the Court of Appeal decisions in England in R v Secretary of State for the Environment, ex p Davies (1990)  61 P & CR 487, Buckinghamshire County Council v Moran [1990] Ch 623 which treated as authoritative and applied the principles enunciated by Slade J in Powell v McFarlane (1979)  38 P & CR 452.

…

As Nourse LJ pointed out in Buckinghamshire County Council v Moran [1990] Ch 623 at p.644, adverse possession can be described as ‘possession as of wrong’ and with limitation it is the intention of the squatter that is essential.

The requisite intention to possess has been referred in various authorities under its Latin tag ‘animus possidendi’. I shall refer to it simply as the intention to possess. As Slade J observed in Powell v McFarlane (1979)  38 P & CR 452 at pp. 471-472, the intention to possess requisite for adverse possession:

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

38.In the context of the proof of animus possidendi, Slade J in Powell v McFarlane explained why the slightest acts done by the paper owner in possession will be found to negative discontinuance of possession, whereas clear and affirmative evidence is required from the trespasser seeking to prove possessory title:

“The question of animus possidendi is, in my judgment, one of crucial importance in the present case. An owner or other person with the right to possession of land will be readily assumed to have the requisite intention to possess, unless the contrary is clearly proved. This, in my judgment, is why the slightest acts done by or on behalf of an owner in possession will be found to negative discontinuance of possession. The position, however, is quite different from a case where the question is whether a trespasser has acquired possession. In such a situation the courts will, in my judgment, require clear and affirmative evidence that the trespasser, claiming that he has acquired possession, not only had the requisite intention to possess, but made such intention clear to the world. 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.” (472)

“In my judgment it is consistent with principle as well as authority that a person who originally entered another’s land as a trespasser, but later seeks to show that he has dispossessed the owner, should be required to adduce compelling evidence that he had the requisite animus possidendi in any case where his use of the land was equivocal, in the sense that it did not necessarily, by itself, betoken an intention on his part to claim the land as his own and exclude the true owner …” (476)

39.In considering the weight of the evidence, Li CJ in Wong Tak Yue at 69A-C advised that self-serving statements should be approached with some skepticism, while considerable weight would be given to declarations against interest, that:

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

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

40.Time does not run if the possession is with the consent of the owner.  The squatter has to show absence of the paper title owner’s consent[20]. As explained by Slade J in Powell v McFarlane at 469 in the case of a licensee:

“time can never run in favour of a person who occupies or uses land by licence of the owner with the paper title and whose licence has not been duly determined, because no right of action to recover the land has ever accrued against the owner; consequently such a person has no ‘adverse possession’ however long his occupation or use may have lasted.”

41.If the subject land had been occupied under a licence, time would not automatically start to run upon termination of that licence.  Cheung Chung Yan v Chan Man Kwong (unreported, CACV 268/2003, 12 February 2004)  was a case in which the licence to occupy had been terminated by the death of the licensor.  Rogers VP observed at §22 that:

“It is not a question of a licence, it is a question of the relevant [squatters] not having any intention to occupy the land adversely to anyone.”

and that

“… it is necessary for the [squatters] to show that after the [licensor’s] death their intention changed from occupying the land respecting the true owner's ownership, to occupying the land intending to dispossess the true owner.”

42.Whilst the issue is facts sensitive, continuous occupation of a property previously a lease with no further payment of rent can be evidence of adverse possession: see Lam Kin Lai v Li Ha Ching and Others [2020] HKCFI 751 at §24, applying Hayward v Chaloner [1968] 1 QB 107 at 122, and Poon Chi Hang v Lai Ho Sun [2019] HKCA 734 at §32.

43.I apply the law as discussed and summarized above. 

I.  The weight of D/Aff 3 and D/WS

44.D/Aff 1 and D/Aff 2 relate principally to D’s application for grant of probate.  Their contents do not assist D in the defence of the present claim.

45.I focus my consideration upon D/Aff 3 and D/WS.

46.D has not been called.  The contents of D/Aff 3 and D/WS are hearsay.

47.There is no objection to the admission of D/Aff 3 and D/WS as hearsay evidence.  The issue is weight.

48.When weighing hearsay evidence, this Court is obliged to have regard to the matters set out in section 49 of the Evidence Ordinance Cap 8, which stipulates as follows:

“Considerations relevant to weighing of hearsay evidence

(1)  In estimating the weight, if any, to be given to hearsay evidence in civil proceedings the court shall have regard to any circumstances from which any inference can reasonably be drawn as to the reliability or otherwise of the evidence.

(2)  For the purposes of subsection (1), regard may be had, in particular, to the following—

(a)  whether it would have been reasonable and practicable for the party by whom the evidence was adduced to have produced the maker of the original statement as a witness;

(b)  whether the original statement was made contemporaneously with the occurrence or existence of the matters stated;

(c)  whether the evidence involves multiple hearsay;

(d)  whether any person involved had any motive to conceal or misrepresent matters;

(e)  whether the original statement was an edited account, or was made in collaboration with another or for a particular purpose;

(f)  whether the circumstances in which the evidence is adduced as hearsay are such as to suggest an attempt to prevent proper evaluation of its weight;

(g)   whether or not the evidence adduced by the party is consistent with any evidence previously adduced by the party.”

49.Section 49 of the Evidence Ordinance is mandatory in nature.  Parties have been reminded of this by the Court of Appeal at §31.1 of the Court of Appeal Judgment.  Mr Siu does not make reference to Section 49 in either his written closing or written reply.  In the course of his oral closing, I invited assistance from him, who then made some very fair submissions and concessions on the topic.

50.I go through first of all the considerations set out in Section 49(2)(a)  to (f)  one by one:

(a)  Section 49(2)(a):

On the medical evidence before me, I accept that it would not have been reasonable or practical to call D; 

(b)  Section 49(2)(b):

(i)  I repeat that D/Aff 3 is dated 5 December 2017, and D/WS 18 October 2018;

(ii)  They are not made contemporaneously with the occurrence or existence of the events or matters stated therein;

(iii)  Mr Siu accepted this;

(c)  Section 49(2)(c):

The relevant contents of D/Aff 3 and D/WS mostly do not involve multiple hearsay;

(d)  Section 49(2)(d):

(i)  D is the defendant in the present action.  He is the sole beneficiary of the Estate.  If the claim is successful, any title he may have over the Property will be extinguished;

(ii)  D reveals in D/WS at §6[21] that in 2015, he received offers from developers to purchase the Property.  The outcome of this claim will no doubt impact upon what he may receive from developers;

(iii)  D has clear motive to conceal or misrepresent matters;

(iv)  Mr Siu accepted the above;

(e)  Section 49(2)(e):

(i)  Both D/Aff 3 and D/WS are prepared specifically for the purpose of these proceedings;

(ii)  They both contained D’s account of events edited in affirmation or statement form for use in the present claim;

(iii)  D must have had assistance from his legal advisers in the preparation of both D/Aff 3 and D/WS.  In that sense, and not in any culpable sense I add, they both were also made in collaboration with D’s legal representatives;

(iv)  Mr Siu also accepted the above;

(f)  Section 49(2)(f):

There does not appear to be any.

51.I next consider sections 49(2)(g)  and 49(1)  together:

(a)  I find the lack of documents containing or evidencing the Oral Agreements inherently improbable;

(i)  D’s case is that the Oral Agreements were made orally, not in writing, and not even evidenced in writing;

(ii)  Counsel have confirmed that there is no contemporaneous document amongst the trial bundle which makes reference to the Oral Agreements;

(iii)  The above is in stark contrast with D’s preparation of the Receipts.  He was meticulous in that regard.  Some of them were entirely handwritten.  He took the trouble of stamping some of them too;

(iv)  He found it necessary to prepare a separate receipt for the lease deposit and electricity deposit in the much lower respective sums of HK$250 and HK$100 (see the Deposit Receipt)[22], yet prepared no document for or recording 2 agreements which deprived himself of 30 years of rent;

(v)  He could easily have made a record of the 1^st Oral Agreement on the Last Receipt.  He did not;

(vi)  The above are in my view inherently most incredible and improbable;

(b)  I find the alleged circumstances leading to the 2^nd Oral Agreement inherently improbable:

(i)  D explained the circumstances leading to the 2^nd Oral Agreement at §§16 and 17 of D/WS[23] as follows:

“16. Sometime in around the end of 1995, I cannot now recall the exact date but it was around the time when [the 1^st Oral Agreement] was coming to an end. I went up to the Property tell [P’s Father] that after the lapse of the 15-year rent-free period, I would like to charge $350 a month as rental. In response, [P’s Father] was reluctant to agree to the proposed rental.

17.  During that time, [P’s Father] also told me that there was an Order to require the outer walls and windows of the Property [sic] and asked me to make contribution thereto.  In light of his reluctant to agree to the proposed rental and the order from the Buildings Department, [P’s Father] and I made another oral agreement.  Pursuant to the new agreement, [P’s Father] would be responsible for carrying out the repairs (the value of which was agreed to be $45,000)  and for complying with any other orders of the Buildings Department, and I would let him and his family live in the Property, rent free, for another 15 years.”

(ii)  To start with, there is no explanation at all as to how the “value” of the repairs were assessed or arrived at.  There was no mention as to whether that building order covered only the Property or the entire Building, if the latter the amount of individual owners’ contribution, nor the exact nature of the works, nor any quotation for the works involved;

(iii)  More incredible in my view is D’s allegation that P’s Father had also agreed to be responsible “for complying with any other orders of the Buildings Department”.  If “any other orders” mean any other order which the Buildings Department might issue in the future, as Mr Siu submitted they do, which do appear to be the case, then P’s Father had agreed to bear a liability which magnitude was completely unknown.  That in my view is contrary to common sense;

(iv)  As things turn out, a number of building orders had subsequently been issued.  I have set them out above.  D has fail to mention them at all, and whether there had been any further discussions between him and P’s Father in relation to those subsequent building orders;

(c)  The lack of document recording his alleged provision of his new contacts to P’s Father is also inherently unlikely:

(i)  D in 1968 provided his then contacts in writing to P’s Father (see the First Receipt)[24];

(ii)  D said that in around 1979 he moved, and his telephone number changed;

(iii)  He at §12 of D/WS deals with the 1^st Oral Agreement.  It was said to be around April 1980.  He then asserts that:

“It was for such reason I did not attend the Property to collect rent after April 1980. I have left [P’s Father] my residential address … and also my telephone number …”

(iv)  No particulars have been provided as to how he did that;

(v)  One thing however is clear. None of the contemporaneous Receipts issued by him after his alleged move records his new contacts, and those Receipts would have been the obvious place for him to do so if he had provided his new contacts to P’s Father;

(d)  In the Court of Appeal Judgment, Yuen JA has in §§12.3 and 12.4 clearly and thoroughly set out her observations on a number of lacunae in D/WS, and the queries which they give rise to, as follows (with most of the footnotes omitted):

“12.3. Pausing there, it can be seen from the italicized passages in §12.1 above that the witness statement contained some lacunae giving rise to at least the following queries.

(i)  Under the alleged 1^st Oral Agreement, the rent-free period expired on 15 April 1995. However, in §16 of D’s W/S, he said it was ‘coming to an end’ around ‘the end of 1995’. His case thus appears to be internally inconsistent. There was no explanation for this internal inconsistency.

(ii)  In §17 of D’s W/S, the defendant alleged that ‘during that time’, [P’s Father] told him there ‘was’ a Building Order, and it was partly ‘in light’ of the Order that the 2^nd Oral Agreement was made. However, this is inconsistent with written evidence in the form of the Building Orders (the earliest of which was made in September 1995, some 5 months after 15 April 1995). There was no explanation for this when the defendant’s case was that the 2 ‘rent-free’ periods finished on 14 April 2010. It is noteworthy that in the defendant’s own words, when he allegedly made the 2^nd Oral Agreement, ‘there was an Order’ (not that an order was likely). Further, if the agreed value of the required repairs for the outer walls and windows was $45,000, he did not explain the agreement for the further open-ended commitment by [P’s Father] to comply with ‘any other orders of the Buildings Department’. The reference to ‘any other orders’ also pre-supposed that at least one order was existing.

(iii)  Further, on the defendant’s own case, the two 15-year rent-free periods would have expired in April 2010 (or as the judge put it, ‘the Plaintiff’s possession was with the consent of the Defendant which expired on 14 April 2010’). However, the defendant only alleged that ‘in around 2011, I went up to the Property once to look for Mr Chan’s wife, but to no avail’(Emphasis added).

- First, he did not explain why he did not visit the Property to propose new terms or collect rent until some 8 months (at least)  after the end of the 2^nd rent-free period in April 2010.

- Secondly, he did not explain why he only visited the Property once in the entire year if he intended to propose new terms or collect rent.

- Thirdly, the words ‘to no avail’ are ambiguous as to what he alleged actually happened, but there was no elaboration at all [Footnote 34:Witness statements must be full and complete, ‘the truth, the whole truth and nothing but the truth’: Hong Kong Civil Procedure 2022, 38/2A/6.] …

- There was no explanation why he did not write to the Chan family at all at any stage.

(iv)  As for the repeated use of the term ‘to no avail’ regarding the defendant’s alleged visit in 2013, again this was ambiguous as to what he alleged actually happened, but again there was no elaboration.

(v)  As for the impracticality of his visiting the Property to collect rent after he moved to a seniors’ home, there was no explanation why he did not adopt any alternative means to collect rent (eg by asking his cousin [Kwong PK] [Footnote 35: Who the defendant asked to pay the management fees in arrears …, and to travel to Thailand for the purposes of the application for Letters of Administration …] to assist, or by asking for payment to a bank account).

12.4. Further,

(i)  although the defendant said in his witness statement that he had given [P’s Father] his new telephone number and had ‘left with’ him his new address and telephone number, he did not say when or how he did so;

(ii)  he gave no reason why [P’s Father] would have needed to look for him a few months after the alleged 1^st Oral Agreement;

(iii)  he said he went to the Property in 1983, 1996 and 2006, but he did not say why he did so (which could not be to collect rent, as these were within the alleged ‘rent-free’ periods);

(iv)  he did not mention [P’s Father’s] physical condition and how he allegedly communicated with him in 1980, 1983 and 1996 ([P] testified that [P’s Father] had suffered a stroke in 1975 after which it was very difficult for him to communicate with persons other than his family members)  …

(v)  he did not mention [P’s Mother’s] mental condition when he allegedly saw her in 2006.  [P] testified that shortly after her father died, ie in 2005, her mother suffered from depression and dementia, always shut herself away in the washroom making no contact with the family or other people, ‘not to mention [D]’.  She confirmed this in cross-examination.  The judge made no finding on this issue as he considered that the [D’s] alleged visits ‘have no significance’ and ‘as [D] was not available for cross-examination’ …”

(e)  I have independently considered the contents of D/WS.  I have also set out above the building orders that have been registered against the Building. I respectfully agree that there are those lacunae in D/WS which give rise to queries as to the reliability of its contents;

(f)  In additional to the above, I note that D has also been inconsistent as to how he got notice of the building order which he claimed partly led to the 2^nd Oral Agreement:

(i)  In D/Aff 3, at §27[25], he says:

“In around 1995 (i.e. around the time when the [1^st Oral Agreement] was coming to an end), I received from the Buildings Department an order to repair the outer walls and windows of the Property. I went up to the Property tell [P’s Father] that after the lapse of the 15-year rent-free period, I would like to charge $350 a month as rental”;

(ii)  However, in D/WS at §§16 and 17[26], he claims that it was P’s Father who told him about that.  I have set §§16 and 17 of D/WS above;

(iii)  The inconsistency is a material one.  D’s case is that it was that building order which partly led to the 2^nd Oral Agreement and the agreement upon the sum of HK$45,000;

(g)  All the above are relevant considerations which this Court shall have regard to for the purpose of sections 49(1)  and 49(2)(g).  In the absence of any oral evidence from D in this retrial, none of those lacunae and queries Yuen JA observed in the Court of Appeal Judgment have been addressed.  Mr Siu has also fairly accepted the above.

52.Mr Siu submits that D’s case on the existence of the Oral Agreements is inherently credible.  His main points in support are that this is not a typical case of adverse possession where the paper owner might not know or might have forgotten about his interest in the subject property.  D had been handling the rental of the Property and had been paying the rates of the Property.  He submits that P is not a credible witness and invites this Court to reject her evidence (which matters I will deal with further later).  He submits that there is no conceivable reason why D would all of a sudden abandon the Property, and that the only possible explanation is the existence of the Oral Agreements[27].

53.I have taken into account Mr Siu’s submissions.  To start with, D’s abandonment of the Property is not an element which P is required to prove. Whether D had abandoned or not, the issue remains whether P has established the necessary elements for adverse possession.

54.Further, D is not available for cross-examination.  The submission that “there is no conceivable reason” is in the circumstances a courageous one.  The issues are facts sensitive.  The value and return of the property concerned are relevant.  There is no evidence before me as to the worth of the Property.  Its return at HK$250 per month is however humble. It has further been laden with building orders.  All these could have a bearing upon D’s conduct.  Indeed, even on his own case, upon the expiry of the 2^nd Oral Agreement, he had only visited the Property twice in 2011 and 2013, both said to have been “to no avail”.  He took no further steps in an attempt to assert his interest in the Property.  He only sought legal advice in respect of the administration of the Estate when he received offers from developers in 2015. 

55.I have considered all the relevant facts and circumstances.  I have considered Mr Siu’s submissions.  I reiterate that D’s mental incapacity has rendered it neither reasonable nor practical for him to be called, that multiple hearsay is not involved, and that there is no evidence suggesting any attempt to prevent property evaluation.  But despite those, and by reason of all the other countervailing matters discussed above, I am of the view that a reasonable inference can be drawn that the contents of D/Aff 3 and D/WS are not reliable. I place no weight on them.   

I.  Credibility and reliability of witnesses

56.Mr Siu relies on Birkenhead Properties and Investments Limited v Lam Kai Man (unreported, HCMP 1588/2012,12 January 2016, at §20)  for the propositions that the registered owner does not have to plead any positive case or call any witness, that he is entitled to rely on his paper title, and that he may test the squatter’s case and is entitled to judgment if the squatter fails to discharge the very high burden of proof.  Those principles are not controversial.

57.Mr Siu further relies on Wong Wai Chi Susanna v Lam Lai Chun and Another [2020] HKCFI 583 for the proposition that those principles and approaches in evaluating evidence in general civil proceedings[28] should be adopted in evaluating the evidence of a squatter.  That proposition is again not controversial.

58.In respect of Kwong PK: 

(a)  I have considered his evidence.  I do not find him to be a reliable witness;

(b)  In the course of cross-examination, he volunteered the evidence that when he went to the Property on 5 June 2016 upon D’s request, he met the management officer of the Building who told him that the Property had not been occupied by anyone for a long time, and that management fees had not been paid.  That however is different from §3 of Kwong PK/WS, where he has said that on that occasion, “I went downstairs and approached the management officer of the [Building]. I asked him if anyone was occupying the Property.  The said officer replied that there is someone living inside but the said management fee had not been paid for long.”.  He was asked to clarify the differences.  He then changed his versions to and fro a number of time.  Then he asked for some time to calm down as he said he was very confused.  I stood the case down for 5 minutes. Upon resumption, he confirmed that the version he gave in his witness statement is the correct one;

(c)  A witness’s recollection of events may become vague with the passage of time.  But the way Kwong PK changed his evidence to and fro several times is in my view not consistent with that of a reliable witness;

(d)  Despite the above, I on balance accept his evidence to the following extent.  He was not involved in the affairs in relation to the Property prior to June 2016.  He confirmed that the Property was locked on the occasions he went there.  He was not able to gain assess inside.  He had been told by the management officer of the Building that the management fee for the Property for the period between October 2014 and June 2016 in the total amount of HK$8,400 had not been paid, and he on 7 June 2016 on D’s behalf settled the same.  Having received a call from a District Council member who could not contact the occupier of the Property (who apparently saw a note posted by Kwong PK on the gate of the Property), he in about mid 2017 helped turn off the water supply of the Property situated on the rooftop to abate certain water seepage problem.

59.I have considered the P’s evidence.  Her material evidence is as follows:

(a)  She was born in 1957;

(b)  Her Father started renting the Property from the [D’s Mother] on 15 April 1968.  She has been living in the Property since then.  Between that date and 19 March 1980, further agreements had been entered into.  She refers to the Receipts.  She highlights the First Receipt and the Last Receipt.  After the Last Receipt, no one has visited the Property to collect rent;

(c)  She, her parents and her sibling had been living in the Property.  Her husband moved in in 1985, and her daughter born in 1986;

(d)  In the meantime, after the Last Receipt, between 1980 and 1983, she and her family had been trying their best to trace D’s whereabouts.  In particular, for 3 days from 15 August 1980, she placed a notice in Sing Tao Newspaper in order to find D[29]. She denies the suggestion that D had somehow provided to her or her Father D’s new contacts;

(e)  During cross-examination, she accepted that if D had turned up at that stage and so if he had so requested, they would have continued to pay rent for the Property.  But D did not.  They started to treat the Property as theirs;

(f)  In 1983, P’s Father decided to renovate the Property.  An internal wall was removed, and the old locks on the front door and gate replaced;

(g)  Since around 1983, she has been paying the expenses in respect of the Property.  They include telephones, electricity (which account name was in March 1986 changed to her brother-in-law)  and water (separate meter under her name in July 1983),

(h)  Between 1987 and 1992, her siblings moved out;

(i)  In around 1992, she and her Father arranged for the renovation of the Property again.  The locks on the front door and gate were again replaced with new ones;

(j)  She has participated in meetings of the Incorporated Owners of the Building since 1983;

(k)  P’s Father and Mother passed away in 2005 and 2012 respectively; 

(l)  There were several notices and orders from the Buildings Department between 1995 and 2010 requiring the owners of the Building to carry out repair work.  She participated in the affairs of the Incorporated Owners for compliance;

(m)  She mentioned specifically BO/10[30]. She contributed HK$30,000 odd as her share of the renovation/refurbishment expenses.  She also made financial contributions on each of the other occasions, though she could not recall the amount;

(n)  In relation to D’s case concerning the Oral Agreements, she says that:

(i)  She denies the existence of the Oral Agreements;

(ii)  P’s Father in about 1975, 1994 and 2000 suffered from three strokes.  Since the first stroke, his communication ability had been seriously impaired.  His speech was slurred, and was difficult to understand. She clarified under cross-examination that while he could still speak, only his family could understand him;

(iii)  In fact, no renovation work was carried out in 1980 in the Property.  The balcony of the Property had already been altered to make the living room larger when they moved in in 1968;

(iv)  In relation to the 2^nd Oral Agreement, in light of P’s Father’s communication problem and health issue, he was unable to make any oral agreement with anyone.  Further, the contribution attributed to the Property in respect of the relevant building order was only about HK$12,000;

(v)  She gave up her job in 1986 and has become a full time housewife taking care of her daughter and Father.  She spent quite a lot of time at home in the Property.  She did not see D attend the Property as he has claimed;

(vi)  P’s Mother suffered from depression and dementia shortly after the death of P’s Father in about 2005.  She always shut herself away in the washroom and made no contact with other people;

(o)  She accepted during cross-examination that she moved away from the Property in about 2016 out of safety concern.  She has however all along kept the key to the Property.  The furniture has also been left inside, and she could move back in anytime;

(p)  She says[31] that:

“25. Since around 1983, whether by myself or through my father, I have been and still is in exclusive possession of the Property with an intention adverse to the [D]. My father and I have never paid any rent or fee to [D’s Mother] or [D] or anyone else for over 30 years, and have suffered no disturbance or interruption from the [D’s Mother] or [D] or any other person or any authority in respect of the exclusive use, occupation, possession and control of the Property by me, whether by myself or through my father.

26.    During the period of the open, uninterrupted and exclusive use, occupation, possession and control of the Property by me, whether by myself or through my father since 15 April 1980 or 1983, neither [D], [D’s Mother] nor anyone claiming or deriving title from, under or through [D’s Mother] had ever made any claim, objection or interruption in respect of the adverse possession as pleaded. Nor had anyone ever queried my (or my father’s)  right or title to use and occupy the Property or asserted any title against me and my father, or made any claim or demand on me and my father in relation to the Property or use of the same by me or my father.”

60.Mr Siu submits that she is not a credible or reliable witness:

(a)  With reference to the ASOC (§§3 and 27), P/WS (§16)  and P’s oral evidence, Mr Siu submits[32] that P has given 3 versions as to when she or her Father first started to regard the Property as theirs: 15 April 1980 (when they started to pay no rent), 15 August 1980 (when D did not show up despite the advertisement, and 1983 (when P’s Father decided to renovate the Property).  Mr Siu makes a related pleading point that P’s case is confined to the pleading, and fails for this reason alone.

(b)  Again with reference to the ASOC (§§3 and 27), P/WS (§§16, 22 and 23)  and P’s oral evidence, Mr Siu submits[33] that P has been inconsistent as to whether she bases her claim on successive possession or joint possession by P’s Father, herself, or her whole family;

(c)  Mr Siu criticizes P’s evidence in relation to the health condition of her Father[34], P’s non-payment of management expenses between October 2014 and June 2016[35], whether she had moved out of the Property[36], her failure to produce all the utilities receipts[37], why P only started the present action in 2015 long after her Father’s death, and her failure to declare her Father’s interest in the Property when she apply for grant of probate.

61.In respect of (a)  and (b)  above:

(a)  I accept Mr Chan’s submissions that P’s evidence is not inconsistent with her pleadings.  In the ASOC and R&DC, P has particularized the facts which she relies on to prove possession and animus possidendi.  The related acts started from the cessation of rent collection, followed by the efforts to locate D, D’s continuous absence, and the renovation in 2013;

(b)  Specifically, I note that §3 of the ASOC is just an overview and summary of P’s case.  The words “since around 1980” are in any event used.  In relation to P’s intention to exclusively possess the Property, it is pleaded at §23 that “At all material times, [P] whether by herself or through [P’s Father] had and still has the intention to possess the Property to the exclusion of all other persons including [D]”.  In respect of §27 of the ASOC, occupation of the Property without payment of rent was, without being strictly legalistic, indeed “adverse” to D.  In my view, P’s evidence in P/WS is factually consistent materially with her pleaded case, and her evidence in Court;

(c)  It is also relevant to note that as a matter of law, for the purpose of deciding whether the paper owner’s title has been defeated, the Court does not need to decide the precise point of time when the occupier entered upon the property, so long as it is satisfied that the occupier has proved that he has been there for twenty years with the necessary intention to possess[38]. For this same reason, I reject also the pleading point raised by Mr. Siu.

62.In relation to P’s evidence on her Father’s health condition, the alleged inconsistencies are more apparent then real.  P has never suggested that P’s Father has become mute and incommunicado.  I accept her explanation that while her Father could still communicate, his speech had become slurred, and that only his family could understand him.  When she says in P/WS words to the effect that it was her Father who during the period shown on the Receipts entered into various tenancy agreements and paid rent, it was because her Father was named as the tenant.  I accept her evidence that in fact, other members had assisted her Father in various affairs of the Property after his first stroke.

63.In relation to the non-payment of management fees, that occurred first in 2014.  The alleged inconsistency is in my view neither specific nor material. At §23(b)  of P/WS which Mr Siu points to[39], P is referring to her participation in the affairs of the Incorporated Owners’ affairs and payment of “expenses” in relation to the Property.  I accept her evidence that whilst she in 2016 moved out or away from the Property for safety reasons, she all along still keeps the key to the Property, that the furniture remains inside, and that she could move back in at any time.  The alleged criticism of “selective documentary disclosure” is in my view not made out.  I accept P’s explanation, which is believable, that she has misplaced some receipts.

64.In respect of the criticisms of the timing of the initiation of these proceedings and the question of declaration when seeking probate, I accept P’s explanations that those were the results of their lack of legal knowledge on the operation of the doctrine of adverse possession.

65.Having considered all the evidence, and despite Mr Siu’s submissions, I find P to be an honest and reliable witness who has tried her best to tell the court what she recalls despite the long lapse of time.  Her evidence is inherently probable, and is materially consistent with the contemporaneous documents and pleadings.

J.  Findings

66.I repeat that I place no weight on D/Aff 3 and D/WS.  I reject D’s case in relation to the existence of the Oral Agreements.  I find that P’s Father has not entered into any of the alleged Oral Agreements with D.  I also rejected D’s bare assertion without any particulars that he had somehow left with P’s Father his new contacts and telephone number.  I find that he had not.

67.I accept P’s evidence as I have outlined above.

68.I remind myself of the high threshold which P has to pass, and that the evidence she put forward has to be compelling.

69.On the first element of physical possession or control, I find that P and her family has been in a single, conclusive and continuous possession of the Property since 1968.  It is pertinent to note the following features of this case.  The Property is a residential unit.  It is not an open space in for example the New Territories.  The Property is behind a locked front door and gate.  P and her family first started occupying the same in 1968.  From about 1980, no further rent had been collected.  It is D’s own case that P and her family at least in the following 30 years remained in occupation of the Property.  I have rejected D’s case on the Oral Agreements.  P and her family renovated the Property at least twice, at their own costs.  They changed the locks, and retained the keys throughout, even during the stage in and after 2016 which P says she moved out for safety reason.  In the meantime, P and her family also bore at their own costs their contributions towards compliance of the building orders.

70.I have considered Mr Siu’s submissions in relation to the gaps in the utilities bills discovered by P.  I accept P’s explanation that she has misplaced some.  I have also considered her evidence that in 2016, she moved away from the Property.  I accepted her evidence that that was on safety concern.  She has however all along kept the key to the Property.  The furniture has also been left inside, and she could move back in anytime.

71.In my view, on the facts before me, the element of physical possession is made out.  It is made out whether on the basis of joint possession or successive possession.  As I have recorded above, Mr Siu is no longer pursuing the alternative defence at §§23(2)  and 18(3)  of the DAC.  I observe, if necessary, that P’s case factually supports specifically one of joint possession by P and her family as their dwelling.  I have set out above the evidence on hers and her family’s occupation of the Property.  I have also set out the applicable law on joint possession above.

72.The same facts in my view support an inference that P, P’s Father and their family had the requisite intention to possess by the latest in 1983 when then renovated the Property at their one costs and changed the locks.  I remind myself that time does not automatically run upon termination of a licence.  But in the present case, P and her family had taken step to find D.  I have considered P’s evidence that if D had turned up upon sight of the advertisement and if he had so requested, they would have continued to pay rent.  But D did not turn up.  By 1983, P’s Father had stopped paying rent for three years.  In the absence of the alleged Oral Agreements, which existence I have rejected, all the acts of continuous occupation without payment of rent, undertaking renovation at their own costs, changing the locks, settlement of utilities, making financial contributions towards compliance of building orders all support an inference of animus possidendi.  There is no need for this Court to rely upon any self-serving statement, and the payment by D of rates does not affect the legitimacy of that inference.

73.I have considered the various authorities cited by Mr Siu[40] in support of his submissions that the acts relied upon by P are equivocal in nature.  But on the facts of the present case as discussed above, I find that they support the inference of animus possidendi on the part of P, her Father and her family.

74.I repeat that I have rejected the pleading point raised by Mr Siu.

75.In all the circumstances, I find that P, P’s Father and their Family had been in exclusive and continuous possession of the Property with the requisite intention for more than 20 years prior to the commencement of the present action.  I repeat that as a matter of law, there is no need for this Court to find precisely when the clock started to run.  If necessary, I would find that it did in 1983.  I accept Mr Chan’s submission in this regard.

K.  Conclusion and disposition

76.For the reasons set out above, I allow P’s Claim. 

77.I have considered the Prayer in the ASOC.  In terms of §(1)(a), it should be made clear that D or his predecessor is barred from claiming against P.  In terms of §(1)(b), and in particular in respect of the words “and [P] has acquired all the title, rights, benefits and interests including the right to exclusive physical occupation of and in the Property”, I am of the view that the establishment of adverse possession only entitles P to a possessory title, but not the wide declaration as sought by P therein.  In this regard, I note that as has been made clear at §25 of Mr Chan’s written closing, a declaration of possessory title is indeed what P is seeking.

78.I therefore make the following Declaration:

(a)  By virtue of section 7(2)  of the Limitation Ordinance, D and his predecessors-in-title to the Property were and had been barred from bringing action against P to recover the Property before and by the time of the commencement of this action; and

(b)  By virtue of section 17 of the Limitation Ordinance, the title of D and his predecessors-in-title to the Property had been extinguished, and P had, and had acquired, possessory title to the Property as adverse possessor of the Property at, and by the time of, the commencement of this action.

79.I accordingly dismiss D’s Counterclaim.

L.  Costs  

80.I make a costs order nisi that that P shall have the costs of both the Claim and Counterclaim, to be taxed if not agreed.  Any application for variation shall be made by letter to this Court within 14 days hereof, upon receipt of which this Court will give further directions with the view of disposing of the same on the papers.

Mr Sunny Chan instructed by Eddie Lee & Company for the Plaintiff

Mr Patrick Siu instructed by BC Chow & Co for the Defendant