黎偉雄 v. Sino Estates Management Ltd and Another
Read the full judgment text of LDBM 61/2020 on BabelCite. This Lands Tribunal judgment was delivered on 22 December 2022.
1. This application involves a composite development known as Maritime Bay ( the Estate ) consisting of residential units, commercial development and car parking spaces. The crucial issue ( Issue 1 ) is whether, since the subject deed of mutual covenant was made on 24 March 1999 ( the DMC ), “Commercial Common Areas” have existed at (i) portion of ground floor ( G/F ) grand entrance ( G/F Entrance ) and (ii) certain former G/F corridors ( Former G/F Corridors ) (collectively the Subject Areas )
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LDBM 61/2020 [2022] HKLdT 68 IN THE LANDS TRIBUNAL OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION BUILDING MANAGEMENT APPLICATION NO.61 OF 2020 ____________
____________ Before: Deputy District Judge S.H. Lee, Presiding Officer of the Lands Tribunal, in Court Dates of Trial: 23, 24, 27, 28 June 2022 and 20 July 2022 Date of Judgment: 22 December 2022 ___________________ JUDGMENT ___________________ Contents A. Issue 1 – Commercial Common Areas or not? D. Rival contentions on Issue 1 E. Other Issues upon Issue 1 ruled in Applicant’s favour
H. Factual Findings on Issue I
J. Issue 2 – Right of Applicant over the Subject Areas under the DMC or not? K. Issue 3 – Applicant’s standing/authority to sue R2 L. Issues 4 & 5 – R1 in breach of duties or not? If so, protected by the DMC or not? M. Issue 6 - Remedies & Quantum
P. Interpretation of this Judgment A. Issue 1 – Commercial Common Areas or not? 1.This application involves a composite development known as Maritime Bay (the Estate) consisting of residential units, commercial development and car parking spaces. The crucial issue (Issue 1) is whether, since the subject deed of mutual covenant was made on 24 March 1999 (the DMC), “Commercial Common Areas” have existed at (i) portion of ground floor (G/F) grand entrance (G/F Entrance) and (ii) certain former G/F corridors (Former G/F Corridors) (collectively the Subject Areas)[1] of the Estate. 2.The Applicant says yes to Issue 1 while both the 1st and 2nd Respondents (R1 and R2) say no. B. Parties 3.The Applicant is an owner of a residential flat at Tower 1 of the Estate (A’s Flat) and also the chairman of Owners’ Committee of the Estate formed under the DMC (OC) [2]. He and another person entered into an agreement on 17 December 1997 to purchase A’s Flat from R2 when it was uncompleted and he became owner of A’s Flat when the said purchase was completed on 7 April 1999. 4.R1 was designated by the DMC as “Managers” of the Estate. It has been managing the Estate until today. 5.R2 is the developer of the Estate and the grantee of the land over which it was built (the Land)[3]. It has been operating a commercial mall (the Mall) situated at (i) portion of G/F and (ii) portion of upper ground floors (UGF) of the Estate until today. 6.R1 and R2 used to belong to the same group of companies. Link Real Estate Investment Trust (LINK) later purchased the entire share capital of R2 and became R2’s holding company. Hence, since January 2012, R2 and R1 no longer belonged to the same group of companies. 7.At this trial, the Applicant appeared in person. R1 was represented at this trial by Mr Justin Ismail of counsel (Mr Ismail). Mr C.Y. Li SC (Mr Li SC) leading Mr Li Pak-hei of counsel appeared for R2 at this trial. 8.On 24 March 1999, before the DMC was executed, R2 had assigned a residential unit in Tower 1 of the Estate (the First Assigned Premises) to two persons[4] defined as the “Second Owner” in the DMC (the Second Owner). 9.Afterwards, the DMC was executed by R2 as the “First Owner” therein, the Second Owner and R1 as the “Manager” thereof. The DMC recited that they had entered into it to (1) define and regulate their respective rights, interests and obligations and those of subsequent owners, (2) make provisions for management of the Land and the Estate, and (3) appoint R1 as the manager to exercise its powers and perform its duties on the terms contained therein. 10.For “the purpose of distribution and sale”, the Land and the Estate was notionally divided in the DMC into 5,411 equal undivided shares. 11.Thereafter, on the same day, pursuant to the DMC[5], R2 assigned to R1 733 shares of the Land and the Estate with the exclusive right to hold use occupy and enjoy “the Common Areas (including Club House) (as defined in the DMC) (bold supplied)” for R1 to hold them on trust for the benefit of all the owners of undivided shares of the Land and the Estate (CA Assignment). 12.“Common Areas” are defined by the DMC to mean, and divided in section B thereof into 4 types: (i) “Estate Common Areas”; (ii) “Residential Common Areas”; (iii) “Commercial Common Areas”; and (iv) “Garage Common Areas”. 13.Issue 1 is concerned with “Commercial Common Areas”, which was defined to mean:
14.No “Common Areas Plans” was, however, annexed to the DMC (or to CA Assignment) to specify or designate the respective location(s), if any, of the above 4 categories of “Common Areas” within the Estate (prevailing guidelines of the Land Office for approving deeds of mutual covenant in giving consent for pre-sale of uncompleted residential properties did not so require[6]). 15.Under Clause 8 at Section L, R2 was only required to prepare “Common Areas Plans” and cause them to be kept at R1’s office within the Estate for owners’ inspection. As shall be seen below, if such plans were prepared by R2 pursuant to the DMC at all, they were not available until a decade later in 2009. D. Rival contentions on Issue 1 16.On Issue 1, the Applicant contended that the Subject Areas had existed at G/F of the Estate at the making of the DMC. They fall within the definition of “Commercial Common Areas” of the DMC. Since the making of the DMC, “Commercial Common Areas” and the remaining 3 kinds of “Common Areas” have all existed within the Estate. All 4 kinds of “Common Areas” have, since the making of CA Assignment on the same day, been held by R1 on trust for all the owners of the Estate (collectively A’s Contentions). 17.Both R2 and R1, however, contended that “Commercial Common Areas” have never existed at G/F of the Estate. The Subject Areas have always formed part of G/F “Commercial Accommodation” privately-owned by R2. Despite CA Assignment, R1 has never held “Commercial Common Areas” or the Subject Areas on trust for all the owners of the Estate (collectively Rs’ Contentions). E. Other Issues upon Issue 1 ruled in Applicant’s favour 18.If Issue 1 is answered yes as the Applicant says, he further alleged that R2 had, since 1999, encroached upon the Subject Areas by (i) putting up kiosks at portion of G/F Entrance and (ii) having shop extensions over Former G/F Corridors (collectively the Encroachment) for its own profit at the expenses of the other owners of the Estate. 19.R1, in alleged breach of its manager’s duties under the DMC, the Applicant said, had condoned the Encroachment and misrepresented to OC about non-existence of “Commercial Common Areas” within the Estate in the past. 20.R1, the Applicant says, is thus liable to pay mesne profit, or account for profit, for the Encroachment totaling $27,919,510 to “Estate Capital Fund” of the Estate. 21.Moreover, the Applicant seeks against R1 damages in sum of $30,598 for alleged misrepresentation which deprived him access to the Subject Areas as owner of A’s Flat. 22.The Applicant finally seeks against R1 and R2 a declaration of “Commercial Common Areas” at G/F of the Estate[7]. 23.For their part, both R1 and R2 disagreed with the Applicant having any right over the Subject Areas (Issue 2) and took issue with remedies claimed by him, including their quantum (Issue 6). 24.R2 further challenged authority/standing of the Applicant to bring these proceedings against it i.e. R2 in his personal or representative capacity (Issue 3). 25.R1 denied alleged misrepresentations and alleged breach of manager’s duties (Issue 4) and sought protection in exemption clause of the DMC (Issue 5). 26.This application is, however, not the only litigation over the Estate between the Applicant and R1 so far. 27.As early as on 28 July 2017, the Applicant had taken out in person another building management application at Lands Tribunal against R1 as the only respondent[8] over a 24-hour Public Pedestrian Way (PPW) at UGF of the Estate. He lost at first instance after trial on 3 August 2018(PPW Case)[9]. 28.The Applicant was later given leave to appeal on 14 May 2019[10]. The rival contentions before the Court of Appeal (CA), set out at paragraph 11 of its judgment, are these: the “Applicant contended that the PPW is “an Estate Common Area” as defined in the DMC. [R1] denied and contended that the PPW is part of the Commercial Accommodation reserved by [R2] under the DMC”. 29.On 11 June 2020, CA allowed the appeal (PPW Appeal)[11] and granted the Applicant a declaration as he claimed. At [23] of its judgment of PPW Appeal (CA Judgment), the Court said:
30.No doubt CA said the above to deal with the different issue before it in the different context of the PPW Appeal (and on the different evidence adduced at trial of PPW Case). They were not said to deal with Issue 1 nor were CA then supplied with additional material evidence adduced at this trial and to be discussed below. Given that R2 was not a party to the PPW Case or the PPW Appeal, CA Judgment is also not binding on R2 as a matter of law. 31.Nevertheless, 4 days after PPW Appeal was allowed i.e. on 15 June 2020, the Applicant launched this application again in person against R1 alone, placing heavy reliance on, among others, CA Judgment (which shall be carefully considered and discussed below). 32.On 24 February 2021, on R1’s application, the Lands Tribunal ordered R2 to be joined as a party to this application. G. Witnesses (G1) Applicant’s sole witness – the Applicant 33.The Applicant elected to give evidence at trial. He gave wide-ranging evidence, including on irrelevant matters unrelated to the Subject Areas[12]. He cited many authorities, most of them also irrelevant, and wrongly quoted some authorities in his evidence, which should consist of facts alone. He wrongly raised arguments in his witness statement when they should appear in his closing submissions. As a layman unfamiliar with court procedure, it is, one may think, not surprising for him to have so prepared his case. 34.On Issue 1, the Applicant relied on the followings in support of A’s Contentions: -
35.The Applicant testified to the effect below as was summarized in paragraphs [18] to [22] above.
36.Both Mr Li SC and Mr Ismail have at trial embarked on lengthy cross-examination of the Applicant. 37.In his closing submissions, Mr Li SC submitted that the Applicant has an ulterior motive in taking out this application as a personal vendetta against R1.
38.For reasons below, I do not agree with the above submissions.
39.All in all, the impression of this Tribunal regarding the Applicant is that he likely took out this application to correct (he perceived) alleged injustice and alleged breach of duty made by R1 at the expenses of other owners. Indeed, he had pursued within OC the Encroachment with R1 since 2005[17]. He apparently found all his past efforts in vain before he took out this application against R1. 40.Nevertheless, on top of procedural mistakes, the Applicant has many misconceptions about the substantive law[18] and the law of evidence. As an example of the latter, he wrongly said more than once that, if R1 disagrees with his figures of mesne profit, R1 could advance its own different calculations, failing which R1 shall be taken to have agreed with his figures. 41.The correct legal position is that as the Applicant took out this application to make claims against R1 and R2, he bears “burden of proof” to prove his claims both on its factual and legal basis[19]. R1 and R2 can simply sit back and put him to “strict proof” of his claims, though on some factual and legal matters, they may elect to advance contrary factual versions[20] and different legal analysis. 42.In terms of facts, the Applicant must prove all elements, including quantum, of his claims to the civil standard of “balance of probabilities”[21] in order to succeed. If he fails at the end of the day to prove his claims on both facts and law, his claims will be dismissed or that, if he manages to prove liability but not quantum, he may be awarded only “nominal” damages or compensation. 43.Overall speaking, besides the shortcomings identified above, this Tribunal finds Applicant’s evidence in many respects illogical, implausible, self-contradictory and inconsistent with other undisputed evidence. 44.Hence, this Tribunal exercises great caution before accepting or acting on any of the disputed evidence of the Applicant and those parts of his evidence not corroborated by other evidence. (G2) R1’s sole witness - Samuel Leung 45.R1 called at trial Mr Leung Kok Cheung, Samuel (Leung), its current District General Manager, as its sole witness. 46.Leung gave evidence that R1 acted as agent for all the owners of the Estate, and independently from others, including from other companies within its group of companies, at all times. R1, Leung said, arrived at its own independent judgment at all times. In all the circumstances, it was, he said, reasonable for R1 to take the view, as R2 did, that there is no “Commercial Common Areas” within the Estate and that the Subject Areas are owned by R2 (and Leung gave various arguments for that as if he was an advocate for R1). 47.Pursuant to the DMC, said Leung, a set of “Common Areas” plans were deposited with R1’s office at the Estate by R2 “at the latest in 2000s after the DMC had been entered into (italics supplied)” and its G/F plan thereof showed no “Commercial Common Areas”. 48.Leung stressed that R1 has been acting properly in meeting the challenge, and in striking the proper balance, arising from such stark differences in opinion between the Applicant and R2 over the Subject Areas. It was, he said, imprudent for R1 to infringe the proprietary rights of R2 over the Subject Areas. In any event, R1 was, he said, not guilty of any wilful act, neglect or dishonesty and should be entitled to exemption under the DMC. 49.The Applicant lacked the ability to effectively cross-examine Leung, who took the chance to read out in the stand his well-rehearsed and long answers on Issue 1. I do not find such opportunistic behavior of Leung entirely satisfactory. 50.Two other features of Leung’s evidence also call for, I think, special attention:
51.Hence, this Tribunal also watches out for such unreliable parts of Leung’s evidence and look out for corroboration, if any, of them from documents and/or other oral evidence before accepting or acting upon them. (G3) R2’s two witnesses - Kenneth Chau & Hung Mei Mei 52.R2 called (i) Mr Kenneth T.H. Chau (Chau), an architect and the Authorized Person (AP) engaged by R2 for the development of the Estate (the Project), and (ii) Ms Hung Mei Mei (Hung), senior portfolio manager of Link Property Management Services Limited, as its 2 witnesses. (i) Chau 53.Chau mainly gave evidence on behalf of R2 of his allocation of 322 shares of the Land and the Estate to “Common Areas” on G/F level of the Estate in draft DMC submitted for approval by District Lands Office, Sai Kung (DLO), by reference to total gross floor areas (GFA) shown on various approved building plans he prepared for the Estate. Importantly, he addressed the question whether or not GFA of the Subject Areas have been included in the calculations and allocation of the said 322 shares. 54.In spite of my initial reservation, I agree with Mr Li SC that Chau gave evidence as a factual witness (and he did not give expert opinion as an expert witness). As a factual witness, Chau has first-hand personal knowledge of the factual matters he testified. 55.In spite of the long lapse of time involved, material parts of Chau’s evidence were corroborated by (and I think he had well refreshed his memory thereof by) contents of contemporaneous documents produced before this Tribunal, including building plans of the Estate, and architect certificates, prepared by Chau himself long time ago. 56.The Applicant had tried his best to cross-examine Chau but Chau was unshaken. Chau could remember most of the time and managed to answer most questions, including questions of this tribunal, from his memory and/or documents before him. 57.All things considered, I find Chau an honest and credible witness. I find most of his evidence reliable. Unless otherwise stated, I accept his evidence referred to in this Judgment. (ii) Hung 58.Hung gave evidence that R2 had never disposed of any “Commercial Unit” of the Mall to others and that it was at all times owner of “Commercial Accommodation” of the Estate, including being owner of the Subject Areas. 59.Hung also gave much evidence on Issue 1 by way of arguments in support of Rs’ Contentions. Among others, she referred to G/F “Common Areas” plan (of a whole set of “Common Areas” plans purportedly prepared by R2 pursuant to the DMC) showing no “Commercial Common Areas” at all. 60.Hung gave more detailed evidence than Leung did on the layout, usage and occupation at G/F of the Mall since it opened for business in 1999. G/F layout of the Mall in the approved building plans can, she stressed, be lawfully changed afterwards, and had indeed been changed by R2 afterwards by way of addition & alteration works (A&A Works)[23]. The DMC allows for such changes and also making of sub-deed of mutual covenants. 61.Residential owners of the Estate had at all times, Hung also said, separate entrances, exits and lobbies at G/F to enter and leave the Estate, and separate lifts for them to go to car-parking spaces at UGF, G/F and basement to pick up, and to return from, their cars, without entering the Mall. 62.Like Leung, Hung also purported to claim without personal knowledge and disclosed document that R2 had adopted a different layout for G/F of the Estate when the Mall opened in 1999 which is not the same as that shown in G/F Approved Building Plan and that, save for A&A works, the said layout (including the present configuration of shops G02, G03-5 and G07) has not changed ever since. However, she had been assigned to supervise the affairs of the Mall since 2014 and not earlier. 63.Hung was also unshaken after cross-examination by the Applicant. Save as otherwise indicated below, such as on G/F shop configuration of the Estate, I find Hung credible and reliable, and I accept her evidence referred to in this Judgment. H. Factual Findings on Issue I 64.I find, and set out in this section, chronologically if practicable, facts relevant to Issue 1 based on common and undisputed reliable evidence adduced at this trial. In so far I need to resolve any conflict of evidence, I give reasons for my preference when I mention such findings below. 65.Most facts in this section happened on or before the making of the DMC. They provide, I think, admissible factual and legal background (or context) for the proper resolution of Issue I. (H1) New Grant 66.The government made the New Grant of the Land to R2 by way of Agreement and Conditions of Sale dated 27 March 1995. The Land is about 5,970m2 in area. According to plan of the Land annexed thereto, it is more or less rectangular in shape. One of its 4 sides runs from north-east to south-west and borders on Pui Shing Road. Another side of it runs from north-west to south-east and borders on Ngan O Road. 67.Users of the Land as provided by SC(4) shall be “non- industrial”, with 2 storeys immediately above mean formation level to be used for “non-industrial” purpose and the remaining storeys above mean formation level to be used for “private residential” purposes. 68.SC(9)(b)&(c) requires that that the total GFA of any building to be erected on the Land shall not be less than 29,164m2. The total GFAs of any building constructed and designed respectively for “non-industrial” and “private residential” purposes shall not exceed 5,325m2 and 43,282m2 respectively. 69.SC(9)(e) requires that the design, disposition and height of any building(s) to be erected on the Land shall be subject to the approval in writing of the Director and no building works (other than site formation works) shall be commenced until such approval shall have been obtained. 70.SC(12) provides for a “segregated pedestrian way or path” as follows: -
71.SC(13) regarding PPW, the subject matter of CA Judgment, is as follows:-
72.SC(17) regarding “Refuse collection system” requires R2 to provide and maintain a “comprehensive and nuisance-free system of refuse collection and disposal” to serve the Land and the building to be erected thereon. 73.SC(24)(a), whose sub-paragraph (v) was heavily relied upon by the Applicant to reinforce A’s Contentions on Issue 1, reads as follows:-
(H2) Approved Building Plans of the Estate 74.Chau and his teams had prepared a whole set of more than 20 building plans of the Estate[24]. Among them, the 2 drawing of G/F and of UGF bear the respective earliest dates of 17 August 1995 and 31 July 1995. The Building Authority (BA) apparently made amendments to these building plans on, inter alia, 15 September 1998 and finally approved them on 13 October 1998 (the Approved Building Plans). 75.Having considered, inter alia, the contents of the Approved Building Plans and the DMC, at the making of the DMC on 24 March 1999 (i.e. 5 months odd after the Approved Building Plans were finally approved) the Estate consisted of, I find, the followings: -
76.Considering both G/F and UGF Approved Building Plans and oral evidence of the Applicant, the upper and lower parts of G/F Entrance at these 2 levels were, I find, connected to one another by escalators at the time of the making of the DMC. A shopper can therefore enter the Mall from outside the Estate through lower part of G/F Entrance (portion thereof is one of the Subject Areas in issue) and take the escalators to go shopping at UGF portion of the Mall or stay shopping at other G/F portion of the Mall. 77.And, looking at G/F Approved Building Plans of the Estate, a total of 7 shops were found marked thereon using the words UFA) put down. They are located at the following approximate locations, namely: -
78.Comparing G/F Approved Building Plan with G/F plan of the Mall dated April 2019 produced by the Applicant[27], the respective size and locations, and the total number, of G/F shops at locations (1) and (3) above have materially changed by 2019.
79.As I said above, I am not satisfied with bare assertion of Leung and Hung both made without personal knowledge or document that the shop configuration of G/F Shops G02, G03-5 and G07 has been, since the Mall opened for business in 1999, the same as it is today.
80.Though the Applicant’s claim of change in shop configuration as from 2005 was also unsatisfactory for lack of supportive document when the above claim of Leung and Hung was put to him by Mr Li SC, in view of contents of G/F Approved Building Plan (which was finally approved on 13 October 1998), I am satisfied that, as at the making of the DMC on 24 March 1999[32], the shop configuration of G/F shops of the Mall was likely the same, and the Former G/F Corridors did likely then exist, as they were then shown on the said plan. In this respect, G/F plan annexed to sales brochure (the Brochure) [33] read by the Applicant before he entered into agreement to purchase A’s Flat on 17 December 1997 also bears similar G/F shop configuration and same Former G/F Corridors, though it was marked with 4 words of “SHOP”. 81.Judging from letter of reply dated 15 August 2017 from BA to the Applicant, the shop boundaries then separating G/F shops in line with G/F Approved Building Plans were, I find, “non-structural”, such that their subsequent alteration made after the opening of the Mall did not require any prior approval of BA (and was not made in breach of the Buildings Ordinance, Cap.123). 82.At the time of the making of the DMC, as a matter of design, the “Residential Development” comprising Tower 1 and Tower 2 as defined in the DMC was, according to Hung’s undisputed evidence[34] which I accept, “self-contained” i.e. their residents having, in terms of human traffic and goods delivery to and from the outside world, their own entrances, exits and passageways unconnected with, and not dependant on, the Mall.
83.While door 1[36] at inner most part of Tower 1 G/F Lobby (Door 1) and door 2[37] at inner most part of Tower 2 G/F Lobby (Door 2) (collectively the 2 Doors) allow “residents”[38] of Tower 1 and of Tower 2 to enter “Estate Common Areas” at G/F and a very small area of the Mall situated at G/F[39] respectively to reach G/F loading and unloading spaces as well as G/F car parking spaces, the 2 Doors are, I find, designed for the limited purpose of arranging delivery of refuse collected from Tower 1 and Tower 2 to designated refuse collection point at G/F level at the time of the making of the DMC. 84.Dotted lines plus arrows were, one observes, expressly inserted into Approved Building Plan of G/F level to mark out 2 routes of refuse delivery commencing at the 2 Doors and ending at the same said “refuse collection point” at G/F level. 85.As shall be seen below, such “right to pass” enjoyed by the Applicant under the DMC as an owner of a “residential unit” does not extend to “Commercial Common Areas”. I do not accept Applicant’s claim in his witness statement that he enjoyed “legal right” as such “owner” to go up to UGF of the Mall (and make use of the PPW) by taking escalator at lower part of G/F Entrance through Door 1 and G/F corridors of the Mall, had these corridors been “Commercial Common Areas” at all[40]. 86.The 2 Doors and 2 routes above are, I think, an exception justified by “refuse collection system” required by SC(17) of New Grant at [72] above. Their design and provision does not, I think, undermine my finding at [82] above that Tower 1 and Tower 2 were “self-contained” from the Mall at the time of the making of the DMC. (H3) Architect’s Certificates & Statutory Declaration 87.On 12 November 1997, DLO wrote to Chau giving its approval to over 20 building plans of the Land submitted by him on 27 October 1997 pursuant to SC(9)(e) of the New Grant. Among them are drawing No.A26 (diagrams for domestic GFA calculations, showing, inter alia, Tower 1 G/F Lobby and Tower 2 G/F Lobby)[41] and drawing No.A27 (diagrams for non-domestic (commercial)GFA calculations, showing, inter alia, the Subject Areas)[42]. 88.On 13 November 1997, Chau gave his first architect’s certificate (AC) as AP, certifying, among others, progress of the Project[43] and that the total GFA of “Common Areas” and the total GFA of the Project is listed as per attached Appendix II[44], which gave a “summary of GFA” as follows:
89.It should, I think, be noted from the above summary, in contrast to having GFA for “Common Area” below “Residential Units” at Tower 1, Tower 2, G/F (i.e. 282.126 m2), UGF and 1/F totaling 6,107.003 m2, making up total residential GFA of 43,281.997 m2 after adding up total saleable areas of 37,174.994m2 for Tower 1 and Tower 2, there was noticeably no GFA for “Common Area” provided for below “Commercial Units” (only 2,994.754 m2 was provided for G/F and 2,330.220 m2 provided for UGF, making a total GFA of 5,324.970 m2 for “Commercial Units”). And the 2 total GFA of 5,324.970 m2 and 43,281.997 m2 for “Commercial Units” and “Residential Units” respectively above are very close to the 2 maximum of 5,325 m2 and 43,282 m2 allowed for “non-industrial” and “private residential” purposes under SC(9)(c) of New Grant at [68] above. 90.On 14 November 1997, Chau gave his second AC as AP to solicitors acting for R2, certifying, among others, that undivided shares of “Common Areas” are equal to saleable areas (in sq ft) of the “Common Areas” divided by 100 and enclosing schedules showing calculation and allocation of undivided shares. 91.Importantly, one finds in one of those schedules Chau enclosed to his second AC the following in terms of allocation of undivided shares[45]:
92.Chau made it clear in his evidence (and I believe him) that only 282.126 m2 of GFA on G/F level at [88] above was used as G/F “Common Areas” base figure and the locations of such residential GFA on G/F are all found within Tower 1 G/F Lobby and Tower 2 G/F Lobby. The said GFA of 282.126 m2 for G/F, Chau said, is the sum total of the GFA of 144.384 m2 for Tower 1 G/F Lobby and that of 137.742 m2 for Tower 2 G/F Lobby both shown in drawing No.A26 at [87] above. 93.Further, according to Chau, none of the 733 shares allocated to “Common Areas” in his schedule was attributable to the Subject Areas. GFA of the Subject Areas had not been used by him for setting the base figure for calculation of undivided shares for “Common Areas” on G/F level. On cross-examination by Mr Ismail, he confirmed, and I agree, that GFA of the Subject Areas shown in drawing No.A27 at [87] above had all been counted towards the total GFA of 2,994.754 m2 at [88] above for “Commercial Units” on G/F level[46]. 94.On 15 December 1997, a solicitor from Deacons Graham & James (Deacons) and another solicitor from Johnson Stokes & Master both acting for R2 in pre-sale of uncompleted units in the Estate together made a statutory declaration (SD), which was registered with the Land Registry on 16 December 1997, in order to obtain government consent for such pre-sale pursuant to provisions of New Grant. Among others, the two of them declared in SD that: -
95.In this connection, it is, I think, no use for the Applicant making in his opening submissions his own calculations of 322 shares for 6 G/F “Commercial Units” allegedly owned by R2 based on UFA found on G/F Approved Building Plans[48]. As the grantee of the Land and the developer of the Project, subject to complying with the conditions of New Grant, R2 was entitled at law to instruct AP i.e. Chau to decide on how to arrive at R2’s own calculation, and distribution, of undivided shares of the Land and the Estate upon execution of the DMC. 96.Pursuant to New Grant, R2 must have later, I find, obtained consent from the government for pre-sale of uncompleted units of the Estate, obtained approval for draft deed of mutual covenant prepared for the Land and the Estate, including having allocated “appropriate number” of undivided shares to common areas thereof in line with SC(24)(a)(v) of New Grant at [73] above, as R2 had “very soon later” entered into an agreement with the Applicant on 17 December 1997 to sell to him A’s Flat as an uncompleted unit of the Estate. (H4) Occupation Permit & Certificate of Compliance 97.On 13 October 1998, BA finally approved the Approved Building Plans of the Estate and, on 29 December 1998, issued occupation Permit for the Estate. On 26 February 1999, DLO further issued certificate of compliance for the New Grant. (H5) The DMC 98.On 24 March 1999, after the First Assigned Premises was assigned by R2 to the Second Owner, the DMC were executed by R2, the Second Owner and R1. The DMC was apparently drafted for R2 by Deacons, whose name was found on it. 99.According to Part I of First Schedule, 5,411 equal undivided shares of the Land and the Estate were allocated as follows (bold supplied).
100.The above allocation of undivided shares is, one observes, identical to those found in 2nd AC prepared by Chau at [91] above, save that Chau had allocated therein 652 shares to “Common Areas & Building Facilities (bold supplied)” and 81 shares to “Club House” separately instead of allocating a total of 733 shares to “Common Areas (including Club House)” found in the DMC. 101.In the remaining part of the said Part I of First Schedule, the total 1,986 shares allocated to “Block 1” of “Residential Accommodation”[49] above were, like that was done in 2nd AC prepared by Chau, distributed to each of “Residential Units” in Tower 1 from 2/F to the roof. As was also done in the 2nd AC, the total 1,894 shares allocated to “Block 2” above were also distributed to each of “Residential Units” in Tower 2. 102.“Except where the context otherwise requires (italics supplied)”, section B sets out, among others, the following relevant “definitions”: -
103.Section C sets out the rights of “owners”, including those of R2 as the “First Owner” thereof:-
104.Section E sets out obligations of “owners” in respect of his unit(s):
105.The powers and duties of “the Managers” in Section I should also be noted. Paragraph 2 thereof reads “The Common Areas and the Common Services and Facilities shall be under the exclusive control of the Managers (bold and italics supplied)” 106.Section J dealing with “Management Charges” has the following provisions.
107.Clause 9 of section L further provides that “nothing in this Deed shall prejudice the operation of the Building Management Ordinance” (BMO)[50]. 108.For our purpose, Part I of Second Schedule sets out following “easements” granted to owners: -
109.Part II of Second Schedule also sets out “exceptions and reservations” in favour of R2 as First Owner: -
110.On 10 April 1999, the DMC was registered with the Land Registry. On two land search records both made in September 2020 produced at trial, R2 was registered at the Land Registry as the owner of: -
The same registration record should, one believes, have appeared at the Land Registry back in April 1999 when the DMC came to be registered at the Land Registry. (H6) CA Assignment 111.This was made by R2 and R1 pursuant to the DMC on the same day, but after the making, of the DMC. It was apparently also drafted by Deacons, whose name was found on its face. It was registered with the Land Registry on 20 April 1999. 112.By CA Assignment, 733 shares of the Land and the Estate, together with “sole and exclusive right to hold use occupy and enjoy the Common Areas (including Club House[52]) (as defined in the DMC) (bold & italics supplied)” (the Property) was assigned from R2 to R1, excepting and reserving to R2 the rights set out in paragraph “1B of the Schedule hereto (bold supplied)”, and “subject also to and with the benefits of the DMC”. 113.Paragraph “1B” of the Schedule is not found within CA Assignment. It is likely a mistake. Instead, paragraph “1(b)(B)” is found in the Schedule. If this is the correct paragraph intended to be referred to, R2 had reserved to itself (I) “the right to the exclusive use occupation and enjoyment of the whole of [the Project] (save and except the Property)”; and (II) “the right excepted and reserved to [R2] pursuant to Part II of the Second Schedule to the DMC” (these include R2’s exclusive and unrestricted right to amend the Approved Building Plans and to enter into a sub-deed of mutual covenant). (I1) A question of construction of the DMC 114.Though the focus before CA in PPW Appeal[53] is different from ours, this Tribunal should, I think, approach Issue 1 using the same approach therein. As was explained by Lam V-P (as he then was) in CA Judgment, Issue 1 is “ultimately a question of construction” of the DMC[54]. 115.Hence, it does not matter much what C&K might have opined in the C&K Opinion (though it would still be considered below for what it is worth). Like any legal opinion offered by any law firm, it is not, I think, determinative or conclusive of Issue 1, which is now to be resolved by a court of law after careful consideration of the evidence adduced at trial and in light of parties’ submissions advanced at trial. 116.For reasons at [27] to [30] above, while this Tribunal pays the greatest respect to the views expressed in CA Judgment on “Commercial Common Areas” of the Estate (which will be carefully considered below), they are not, I think, determinative or conclusive of Issue 1, whose resolution requires this Tribunal to construe the DMC in light of evidence adduced at this trial and the rival contentions of the parties advanced before me. The same also applies to grounds of appeal for the Applicant to argue in PPW Appeal when leave (or permission) to appeal was given to him by CA on 14 May 2019[55]. They are not, I think, determinative or conclusive of Issue 1 either. (I2) Applicable principles for construing the DMC 117.And one should approach this construction process in the following manner. The then Vice-President said at [26] of CA Judgment: -
118.It is worthy, I think, also remembering what Lord Hoffman NPJ said earlier in Jumbo King v Faithful Properties Ltd & Others (1999) 2 HKCFAR 279, 296D-I:
119.As Kwan V-P had explained at [16] of Achieve Goal Holdings Limited v Zhong Xin Ore-Material Holdings Company Limited [2020] HKCA 51, the said “unitary exercise” of construction is as follows.
Through the above iterative process, “all relevant pointers should be taken into account”: [24] of CA Judgment. And “each DMC has to be construed against its own scheme and factual matrix”: [49] of CA Judgment. (I3) Legal background in general 120.As to general legal context against which I have to perform the above iterative process for construing the DMC, I can do no better than quoting again what Lam V-P (as he then was) said at [27] to [31] of CA Judgment below.
(I4) Markings on 2009 plans disregarded 121.Before I embark on the above iterative process, I would dispose of purported “Common Areas” plans produced by R2 first. They consist of 10 plans, all bearing Chau’s signature and a small date of “Aug 09”[56] (2009 CA Plans) 122.None of these 2009 CA Plans was marked with “Commercial Common Areas” (the Subject Areas were not marked as common areas at all). Only “Estate Common Areas”, “Residential Common Areas” and “Garage Common Areas” were marked on them with the respective colors of green, blue and yellow. 123.The G/F plan within 2009 CA Plans, though it is dated Aug 2009, contains the same shop configuration shown in the Approved Building Plan for G/F level, including Former G/F Corridors. Its markings included the followings: -
124.Chau, Leung and Hung all gave no explanation in their witness statements why 2009 CA Plans came to be prepared a decade after the DMC was made (by which time existence or otherwise of “Commercial Common Areas” has become topic for discussion within OC) and, on enquiry of this Tribunal, they gave no clue in the box either. Though he was maker of 2009 CA Plans, Chau in fact made no mention of them in his witness statement. Upon enquiry of this Tribunal, Chau said in the box that he was instructed by, I find, R2[57] to prepare them in about 2009. He only gave some general criteria explaining his marking of the 3 kinds of “Common Areas” on the same. 125.CA had, I note, at [18] of CA Judgment already pointed out the aforesaid evidential discrepancy and omissions. Unfortunately, most of them remain unresolved before me at this trial. Given further that 2009 CA Plans were prepared long after the making of the DMC, even had they been made pursuant to the DMC (on which I do not decide), they are not, I think, admissible factual context for determining Issue 1 (Mr Li SC made it clear that R2 did not rely on them) and they do not conclusively determine Issue 1, which remains to be decided by proper construction of the DMC against the relevant factual and legal context: [17] of CA Judgment. I therefore decide to disregard markings on 2009 CA Plan in my resolution of Issue 1 below. (I5) Alleged pointers in support of A’s Contentions (i) BMO definition of “common parts” & presence of the Subject Areas at G/F 126.To start with, the Applicant can, I think, pray in aid definition of “common parts” at s.2 of BMO and reference of “passageways” and “corridors” at paragraph 8 of Schedule 1 of BMO referred to at CA Judgment reproduced at [120] above. 127.The Applicant can point to physical presence of G/F Entrance and Former G/F Corridors, forming the Subject Areas, at G/F level of the Estate at the making of the DMC and argue that they fall within paragraph 8 of Schedule 1 of BMO as “passageways” and “corridors”. 128.Hence, the Applicant could argue, unless the Subject Areas are specified or designated in the DMC as being for the exclusive use, occupation or enjoyment of an owner, they are deemed to be common parts under BMO. (ii) Construction against reservation 129.The Applicant further sought to reinforce A’s Contentions by referring to legal principles for construing reservation i.e. a grantor who desires to reserve something out of his “grant” must be clear about what he is keeping and that, if the grant is ambiguous, the doubts will be resolved against him. Applying such principles, he submitted that R2 had not, in the DMC, unambiguously “reserved” the Subject Areas under its exclusive use, occupation and enjoyment. 130.In reply, both R1 and R2 had pointed out that Lord Hoffman NPJ had at 296C of Jumbo King, supra, thrown doubt about application of the above principles to deeds of mutual covenant, which, as its name suggests, is “mutual”. The parties to such a deed contract as covenantor as well as covenantee (i.e. they give mutual promises to each other). They do not reserve anything, unlike a “grant” by way of assignment of undivided share. Hence, these principles, I agree with the Respondents, cannot assist the Applicant in this case. (iii) Definition of “Commercial Common Areas” in the DMC 131.The Applicant further pointed to presence of the definition of “Commercial Common Areas” in section B in support of A’s Contentions. Had “Commercial Common Areas” not existed at the Estate at the making of the DMC, the said definition would not, he argued, have appeared in the DMC. This factor must, I agree, be taken into serious consideration in our construction process. 132.The said definition of “Commercial Common Areas” can, one thinks, be broken down into the following 4 components i.e.
133.The Subject Areas fall, I agree, within “Commercial Development” in component (1) above i.e. within an area on G/F of the Estate indicated on the Approved Buildings Plans for commercial use. 134.G/F Entrance and Former G/F Corridors fall, I also agree, within the 2 words of “entrance” and “corridors” stressed by the Applicant and found in component (3) above. 135.And it was, I note, never suggested by R1 or R2 that the Subject Areas fall within “Estate Common Areas”, “Residential Common areas” or “Garage Common Areas”. So component (4) above is also met. 136.But, for component (2) above, it is also Applicant’s case that “733 shares of the Land and the Estate, together with sole and exclusive right to hold use occupy and enjoy the Common Areas (including the Club House) (as defined in the DMC) (bold and italics supplied)” had been assigned under CA Assignment from R2 to R1 for R1 to hold them on trust for all owners of undivided shares of the Land and the Estate. 137.“Common Areas” as defined in the DMC, as the Applicant repeatedly stressed, include “Commercial Common Areas”. Hence, the Applicant argued and we should, I think, never lose sight of the argument that the Subject Areas as part of the Property could have been assigned to R1 under CA Assignment. 138.As such, unless the context otherwise requires, exclusive use and enjoyment of the Subject Areas had been assigned to R1 as an “owner”[58] by way of CA Assignment. It follows that component (2) above, and the entire definition of “Commercial Common Areas”, cannot be satisfied for the Subject Areas as alleged. 139.At the same time, it may be open to the Applicant to argue that component (2) above, and the entire definition of “Commercial Common Areas”, was still met as the said 733 shares together with exclusive use of “Common Areas” (as defined in the DMC) (i.e. inclusive of “Commercial Common Areas”) were assigned to R1 as “trustee” for R1 to hold them for all owners of the Estate. The said context requires one to read otherwise that the Subject Areas had not been assigned by way of CA Assignment to R1 as beneficial “owner” thereof. 140.It should be noted that the same component (2) above was also used as component in the other 3 definitions of “Estate Common Areas”, “Garage Common Areas” and “Residential Common Areas”. Had the same argument at [136] to [138] above be run for them, the said 3 definitions cannot be satisfied either. But I think no party before this Tribunal ventured to suggest the absurd proposition that the Estate lacked “Estate Common Areas” since the making of the DMC. (iv) CA Assignment to R1 on trust 141.The next submissions of the Applicant would no doubt be that “Commercial Common Areas”, forming part of “Common Areas” defined in the DMC, were by CA Assignment assigned from R2 to R1 after the making of the DMC. 142.The said 733 shares of the Land and the Estate referred to in CA Assignment, the Applicant could emphasize, had not been allocated in Part 1 of First Schedule to “Estate Common Areas”, “Residential Common areas”, “Garage Common Areas” or any combination of them. Nor had R2 assigned in CA Assignment to R1 “Estate Common Areas”, “Residential Common areas”, “Garage Common Areas” or any combination of them. 143.Had the Subject Areas as “Commercial Common Areas” been previously assigned to R1 under CA Assignment, the views of CA at [23] and [51] of CA Judgment cannot, I think, be doubted. That is, R2 cannot thereafter unilaterally avail its reserved rights as “First Owner” in the DMC to amend the Approved Building Plans, or make sub-deed of mutual covenant, regarding the Subject Areas as exclusive right to occupy the same as “Commercial Common Areas” had already been assigned to R1. (v) C&K Opinion of two “Commercial Units” 144.The Applicant also relied on C&K Opinion in purported support of A’s Contentions. C&K had offered an analysis therein of “G/F Commercial Accommodation” being one “Commercial Unit” having 322 shares and of “UGF Commercial Accommodation” being another “Commercial Unit” having 251 shares. 145.For definitions of “Unit” and “Commercial Unit” in Section B, the format of Part I of First Schedule, and clause 1(a) in Section C to be discussed below, one can well understand why C&K opined that there were 2 “Commercial Units” at the making of the DMC. After all, 322 and 251 shares were respectively allocated to “G/F Commercial Accommodation” and “UGF Commercial Accommodation” and not 573 shares allocated to all “Commercial Accommodation” for both floors. 146.However, C&K’s analysis above is, in my view, problematic and, in any event, does not fully support A’s Contentions.
(vi) Special Conditions of the New Grant 147.The Applicant further drew support for A’s Contentions from the New Grant. 148.He pointed to SC(13) of New Grant at [71] above. That deals with PPW located at UGF of the Estate. It was held to be “Estate Common Areas” by CA Judgment. The Subject Areas were, however, said to be “Commercial Common Areas” situated at G/F of the Estate. The two are totally different subject matters. This special condition is, I think, irrelevant to this application and does not assist the Applicant. 149.The same applies to SC(12) of New Grant at [70] above. On my findings at [75] above, that deals with covered pedestrian walkway connecting the 2 residential towers at 1/F podium level of the Estate. It is also a different subject matter at a different level. It does not assist the Applicant in advancing A’s Contentions either. 150.The Applicant finally pointed to SC24(a)(v) of New Grant at [73] above. He seized upon words such as “arcades”[61], “common entrances” and “passageways” found therein as “Common Areas” (or “Commercial Common Areas”) and submitted that they must be provided for at the Estate by R2. 151.I do not agree. 152.SC24(a)(v) of New Grant deals solely, I think, with “allocation” of “appropriate number” of undivided shares to “Common Areas” in draft deed of mutual covenant submitted for obtaining approval for presale of uncompleted units of the Project. That is to prevent unfair allocation of undivided shares to “Common Areas” in the DMC by R2, so as to provide some level playing ground to prospective purchasers of uncompleted residential units therein. 153.The above special condition does not, I think, impose any obligation on R2 to set up any particular kind(s) of “Common Areas” (or “Commercial Common Areas”) within the Project (those given in the condition are, I think, possible candidates only). The New Grant was dated 27 March 1995. The earliest G/F drawing of the Approved Building Plans was dated 17 August 1995. At the time of the former, the government could, I think, hardly have any idea of what G/F building plan would in future be put forward for the Estate and therefore could not have imposed the alleged obligation above on R2. (I6) Alleged pointers in support of Rs’ Contentions (i) R2 sole owner of entirety of the Land at first 154.R1 and R2 both started off by emphasizing that, prior to the assignment of First Assigned Premises to Second Owner, R2 as the “First Owner” was the sole owner of the Land entitled to possession of each and every corner of the Land and the Estate. Until R2 has parted away any part of the Land, it remains owner of its entirety. Hence, there was, they say, no need as alleged by the Applicant for R2 to reserve the Subject Areas to itself. 155.R1 and R2 sought to seek support from clause 2 in Section C, whereby R2 as “First Owner” shall have “the full and exclusive right… to hold, use, occupy and enjoy the whole of the Land and the Estate… save only the First Assigned Premises and the Common Areas (bold and italics supplied)”. 156.Their approach to construction above, R2 argued, is consistent with definition of “common parts” in BMO. In any event, the said definition is also “subject to context”[62]. There is also, it was added, no requirement in BMO that designation or specification of exclusive use areas need to be done “expressly”[63]. 157.The Applicant’s contrary argument that it is necessary for R2 to “reserve” the Subject Areas “expressly” or otherwise, or else the Subject Areas would fall within “Commercial Common Areas” is therefore, R1 and R2 submitted, erroneous. 158.That R2 was at first the grantee of the Land i.e. the owner of the entirety of the Land cannot, I think, be doubted. That is, I cannot but agree, an important context in our case that needs to be considered in applying the definition of “common parts” in BMO. I also agree that BMO does not require “express” designation or specification of exclusive use areas in the DMC. 159.Subject to definition of “Commercial Common Areas” in the DMC and CA Assignment executed after the making of the DMC, both of which will be addressed separately below, the above starting point argued for by R1 and R2 cannot, I think, be faulted. (ii) R2 owner of entire “G/F Commercial Accommodation” 160.Starting from the above starting point, after parties’ execution of the DMC, putting aside DMC definition of “Commercial Common Areas” and CA Assignment to be addressed below, R2 remained, R1 and R2 submitted, owner of the entire “Commercial Accommodation (bold supplied)” of the Estate, to which R2 was allocated 322 undivided shares for G/F (and 251 shares for UGF) in Part I of First Schedule (and the same likewise appears in R2’s land search records at [110] above). 161.I agree with the above submissions. 162.Under clause 1 in Section C, each share shall be held by the person entitled thereto together with “(a) the full and exclusive right … to hold, use and occupy the Unit designated opposite to it in the First Schedule…” and “(b) subject to … the benefit, insofar as applicable, of the easements, rights… in Part I of the Second Schedule; but subject to the exceptions and reservations … in Part II of the Second Schedule (bold and italics supplied)”. 163.One finds in Part I of the First Schedule to the opposite of “322 shares” (owned by R2) only the words “G/F” below the words of “Commercial Accommodation” and no other words. 164.Admittedly, there is, R2 agreed, no definition of “Commercial Accommodation” in the DMC. However, Mr Li SC submitted, and I agree, that it should mean “Commercial Development” without “external wall thereof”, as the latter is defined to mean “those areas on the ground floor, upper ground and external walls thereof within the Estate indicated on the Approved Plans for commercial use (bold supplied)”. 165.Looking at G/F level of the Estate as at the date of the DMC, “G/F Commercial Accommodation” would, I think, unlikely be as large as entire G/F of the Estate. It is because G/F level of the Estate apparently also includes, for example, car parking spaces with one share allocated to each space, “Residential Common Areas” like Tower 1 G/F Lobby and Tower 2 G/F Lobby, and facilities like “transformer room”, “management control room” and “refuse storage chamber” specifically provided for in definition of “Estate Common Areas” (and “Common Areas” was allocated 733 shares in the DMC). 166.“Commercial Accommodation”, I further agree with Mr Li SC, is likely more than a “Commercial Unit”, which is defined in the DMC to mean “a Unit situate in the Commercial Development (bold supplied)”. “Unit” is defined as “a part of the Estate the exclusive use and enjoyment of which has been or is intended to be assigned to an owner (bold and italics supplied)”. Mr Li SC placed great emphasis in his submissions that R2 is owner of G/F “Commercial Accommodation” and not owner of “Commercial Units” or “shop units”[64]. (iii) Alleged test for creating “Commercial Common Areas” 167.Mr Li SC submitted that, on the definition of “Commercial Common Areas” in the DMC and consistent with Respondents’ approach above, the test of whether there comes into existence any “Commercial Common Areas” is whether R2, as owner of entire “Commercial Accommodation”, has alienated any part thereof to others[65]. 168.Mr Li SC reasoned that, unless and until R2 assigns any part from “Commercial Accommodation” solely owned by it to another or others so as to create a situation of “co-owners” of “Commercial Accommodation”, there would not be any necessity to create “Commercial Common Areas” out of “Commercial Accommodation” to serve all these co-owners of “Commercial Accommodation”. (iv) Communal use of “Commercial Common Areas” by co-owners of “Commercial Unit” 169.Looking at the last few lines of the long definition of “Estate Common Areas” starting with the words “communal areas”, one can, I think, reasonably infer that all 4 kinds of “Common Areas” defined in the DMC are all reasonably intended for “communal” use by one or more specific “group(s)” of “owners” i.e. “Residential Common Areas” by owners of “Residential Units”, “Garage Common Areas” by owners of “Carpark”, and “Commercial Common Areas” by owners of “Commercial Units”, whereas “Estate Common Areas” are to be shared by all 3 groups of the above owners. And these 4 groups of “Common Areas” are mutually exclusive of each other when one reads their respective definitions in the DMC. 170.Mr Li SC reinforced the above “Common Areas” arrangement by referring to the fact that the Residential Development is, by its design, “self-contained” i.e. the residential owners can connect with the outside world without going through the Mall. 171.Mr Li SC further submitted by reference to clause 1 in Part I of Second Schedule that the scheme of the DMC is that owners of “Residential Unit”, owners of “Commercial Unit” and owners of “Carpark” could only enjoy the right to go over their respective “Common Areas” that serve their respective portion of the Estate[66] and that all 3 groups of owners enjoy the same additional right of going over “Estate Common Areas”. Reading the said clause 1, I agree with his submissions on the said “right to pass” and reject the contrary submissions of the Applicant[67]. 172.The scheme of the DMC in having different budgets to be prepared for, and different capital funds to be collected for, the above 3 groups of owners, Mr Li SC argued and I agree, serves further to reinforce the above arrangement. 173.Accordingly, Mr Li SC submitted that any assignment of part of entire “Commercial Accommodation” owned by R2 to other(s) would, in line with the scheme of the DMC and the above arrangement, create one of the 3 groups of owners intended above (i.e. co-owners of “Commercial Unit” above) to necessitate and require “communal” use of “Commercial Common Areas” to be created, also, out of “Commercial Accommodation” owned by R2. 174.I find the above coherent submissions of Mr Li SC very persuasive and weighty. These submissions are all in line with the scheme of the DMC read as a whole. 175.Had the Subject Areas been “entrance” and “corridors” within definition of “Commercial Common Areas”, the ordinary function of G/F Entrance (one of the Subject Areas) is, one thinks, to allow would-be shoppers to access different shops at G/F portion of the Mall and/or its UGF portion through escalators linking the two. And that of Former G/F Corridors (the other of the Subject Areas) is to allow would-be shoppers to get around different shops, and other facilities, of the Mall, in their vicinity for shopping purpose. 176.The Subject Areas are therefore, one thinks, not reasonably intended to be set up, or required, by one single owner like R2 as the sole owner of the entire “Commercial Accommodation” at both G/F and UGF levels. 177.That said, Mr Li SC’s aforesaid test at [167] above is a positive requirement requiring part(s) of “Commercial Accommodation” having been assigned away to other owner(s) (to create co-owners of “Commercial Unit”) whereas component (2) of the definition of “Commercial Common Areas” at [132] above is, I would point out, a different negative requirement requiring that the intended common areas in the Commercial Development (e.g. entrances, corridors etc.) “has not been assigned to any owner” (bold and italics supplied)”, though the latter may imply that the positive requirement suggested by Mr Li SC has earlier been complied with. 178.Component (2) of the said definition of “Commercial Common Areas” (and, as noted at [140] above, similar component in definitions of other three kinds of “Common Areas”) would, I think, be “badly” drafted had the test suggested by Mr Li SC above been what the drafter of the DMC had in mind in drafting it. (v) No assignment to other(s) of “Commercial Accommodation” intended at time of the DMC 179.Mr Li SC continued to submit that R2 plainly had no intention at the execution of the DMC in alienating any part of entire “Commercial Accommodation” owned by it to others.
180.For the above 2 reasons he gave, I agree with the above submissions of Mr Li SC. If I may add a third reason to support them, the shop boundaries on the G/F Approved Building Plans prepared by Chau are merely “notional” or “indicative” and R2 may decide to change them subsequently. 181.For the sake of completeness, I should make it clear that I accept Hung’s evidence supported by land search records before me that R2 has not alienated to others any part of G/F and UGF “Commercial Accommodation” until today. (vi) Empty definition of “Commercial Common Areas” reserved for future use 182.In reply to Applicant’s reliance of this definition, Mr Li SC countered that it was inserted to cater for future scenario when D2 decides to sell part of “Commercial Accommodation”. He referred to R2’s reserved rights as “First Owner” to amend Approved Building Plans and to enter into sub-deed of mutual covenant and suggested that provisions like the said definition are needed at the making of the DMC as and when the occasion arises in future[68]. 183.In other words, at the making of the DMC, the said definition of “Commercial Common Areas” is, to quote R1’s submissions, an empty one with nothing to fall into it. 184.Empty definition is, I agree, possible and unobjectionable in principle[69]. That said, nothing in the wordings of the definition of “Commercial Common Areas” itself[70], or in the recital of the DMC, suggests that it is an empty one. (vii) Unattractive to have common areas within one’s private property 185.To reinforce the above submissions, Mr Li SC submitted that the idea of having common areas within one’s private property is an unattractive one on the case law[71] such that the Subject Areas should not be considered “Commercial Common Areas” within R2’s private property of “G/F Commercial Accommodation”. 186.I agree with R2 that this is also a factor to be considered in the round. It serves no purpose to have “Commercial Common Areas” when the entire “Commercial Accommodation” remained solely owned by R2 (and all the ancillary deposit and expenses would in the meantime be paid by R2 alone, whether or not separate capital funds, or separate budgets, are collected or prepared by R1). (viii) Chau’s evidence of allocation of undivided shares 187.R1 and R2 further relied on Chau’s evidence (inclusive of ACs and SD) at [87] to [93] above to make good their submissions that there was no “Commercial Common Areas” at the making of the DMC. 188.The above material evidence of Chau (who was significantly not called by R1 at trial of PPW Case) is, I agree, wholly consistent with, and strongly supports, Rs’ Contentions. I think they point to: 1) no GFA being provided for “Commercial Common Areas” i.e. “Common Area” below “Commercial Units” at that stage; 2) all “Common Area” on G/F at that stage attributable to “Residential Common Areas” i.e. Tower 1 G/F Lobby and Tower 2 G/F Lobby; and 3) the Subject Areas being part of “Commercial Units”. 189.In reply, the Applicant pointed to 3 cases where “saleable areas” were held unreliable guide for determining common parts[72]. However, the facts of these cases are, I think, distinguishable from this case. 190.Instead, as AP of the Project, Chau had in our case performed the indispensable process of allocating and distributing undivided shares which ultimately found their way into the DMC. Such background information provided by him is, I think, weighty pointer in our construction exercise of the DMC. (ix) CA Assignment not assigning away “Commercial Common Areas” 191.It must, of course, not be forgotten that after the making of the DMC, R2 had seen fit to enter into CA Assignment whereby “Common Areas (including Club House) (as defined in the DMC) (bold supplied)” was assigned to R1 and “Common Areas” is defined in the DMC executed earlier by R2 to include “Commercial Common Areas”. The obvious problem posed by CA Assignment against Rs’ Contentions has been set out at [143] above. 192.Mr LI SC countered to submit that, were there no “Commercial Common Areas” at the making of the DMC on its proper construction, any subsequent assignment of “Common Areas” in CA Assignment to R1 would not have carried any “Commercial Common Areas” (or the Subject Areas) in its favour. 193.As between the DMC and CA Assignment, I agree that one must construe the former (and not the latter) to ascertain if “Commercial Common Areas” exist or not. The subject matters of the Property to be assigned to R1 by way of CA Assignment depend on the subject matters forming “Common Areas” as defined by the DMC. (I7) Result of unitary exercise of construing the DMC 194.All things considered, having regard to proper context of the DMC, considering its entirety, its practical objects and its language, including the “poor” quality of its “professional” drafting, a reasonable person would, I think, have understood the parties to mean what R1 and R2 had contended by way of Rs’ Contentions. 195.Notwithstanding the contrary views expressed by CA in the CA Judgment at [29] above, having undertaken the said iterative process of construing the DMC on the basis of such findings of fact I have made after considering the different evidence adduced at this trial, I conclude that there was no “Commercial Common Areas” at G/F of the Estate when the DMC was made. The Subject Areas have always been and remained R2’s private property forming part of G/F “Commercial Accommodation”. And R2 has never assigned them away to R1 by way of CA Assignment thereafter. 196.I therefore answer no to Issue 1 as R1 and R2 suggested. That, I believe, is fatal to all claims made by the Applicant against R1 and R2 in this application, which shall stand all dismissed. In the event I have wrongly decided Issue 1, I also briefly give my views below on the rest of the issues in dispute. J. Issue 2 – Right of Applicant over the Subject Areas under the DMC or not? 197.Were the Subject Areas “Commercial Common Areas” as alleged by the Applicant, for reasons given at [171] above, I agree with R1 and R2 that the Applicant, as owner of a residential unit, enjoys no right over the Subject Areas under the DMC. 198.As owner of a residential unit[73], the Applicant, I think, enjoys the right to pass over “Residential Common Areas” and “Estate Common Areas” only, and also enjoys the right to use the “Recreational Areas and Facilities” for the purpose of recreation[74]. 199.Were I wrong on Issue I, I would have ruled that the Applicant has no right over the Subject Areas under the DMC. K. Issue 3 – Applicant’s standing/authority to sue R2 200.For this challenge on standing/authority of the Applicant, R2 relied on clause 6 in Section L, which reads as follows:
201.No resolution has, R2 pointed out and I agree, ever been passed pursuant to Section F to authorize the Applicant to sue any alleged “defaulting owner” like R2 on behalf of himself and other owners. 202.After commencement of this application and shortly before annual meeting of owners to be held on 29 October 2021, the Applicant had, I find, by his letter dated 23 October 2021 suggested to other owners to authorize one owner pursuant to the said clause 6 of Section L to correct such legal wrongs allegedly committed by R1 as manager, including that over the Subject Areas. No such authorization was, however, given to the Applicant in the end. 203.On the above factual basis, the Applicant, R2 argued, lacks authority or standing to sue R2 in his personal capacity or representative capacity for other owners. 204.For reasons below, clause 6 of Section L[75] does not, I think, assist R2.
205.Were I wrong on Issue 1, I would have therefore ruled that the Applicant is entitled to sue R2 in his personal capacity to enforce covenants in the DMC. L. Issues 4 & 5 – R1 in breach of duties or not? If so, protected by the DMC or not? 206.Were I wrong on Issue 1, I would have agreed with Mr Ismail that the duty owed by R1 as manager under the DMC to owners of the Estate (including the Applicant) is not “absolute or strict”. The overall duty imposed on R1 by the DMC is one of “proper” management. It entails doing all that is “reasonably” required of a manager in the circumstances: Lo Yuk Chu v Hang Yick Properties Management Limited [1996] 4 HKC 278, 281D-282E. 207.Put it another way, R1 is not, I think, expected to think and act in a mistake-proof and perfect manner. R1 cannot be an insurer for the owners of the Estate whenever problem arises. R1 is only expected to think and act in the same way what a reasonable manager could have thought and done in the circumstances R1 found itself in at all material times. 208.This Tribunal refers to the following provision in Section I by way of illustrations of such a “reasonable” standard of duty imposed by the DMC on R1: -
209.In order to be guilty of “wilful act, neglect, misconduct” in clause 7 above, I agree with Mr Ismail that R1 “must know what it is doing and intends to do what it is doing”. If R1 is merely in breach of his duty, and therefore negligent, R1 is not guilty of “wilful negligence”, unless R1 “knows that he is committing, and intends to commit, a breach of his duty, or is recklessly careless in the sense of not caring whether his act or omission is or is not a breach of duty”: Hoi Kong Container Services Co Ltd v Bewise Motors Co Ltd [1997] 2 HKC 615, 626F-627A 210.In all the circumstances of the case, it was, I think, reasonably open for R1 to have taken the view at all material times that there is no “Commercial Common Areas” of the Estate and that the Subject Areas are not within the same and I find that R1 had honestly taken such view upon independent judgment of its own. My reasons are as follows.
211.For the same reasons above, I am also not satisfied that R1 had, as alleged by the Applicant, misrepresented, let alone “fraudulently” misrepresented, to OC about non-existence of “Commercial Common Areas” within the Estate. 212.Given that R1 has at all material times “reasonably” and “honestly” opined that there is no “Commercial Common Areas” within the Estate, R1 had not, I think, acted “unreasonably” or in breach of its DMC duties in not taking out legal proceedings against R2 for the Encroachment as alleged by the Applicant. 213.In so far as may be necessary, I further agree with Mr Ismail, and would have further held, that R1 is entitled to protection under clause 7 of Section I as, for same reasons given above, R1 has not, I find, been guilty of any “wilful act, neglect, misconduct or dishonesty” on this subject matter of “Commercial Common Areas”. 214.Therefore, were I wrong to have decided Issue 1 as I did, I would have held that R1 had not been in breach of its DMC duties or guilty of alleged misrepresentation to OC as alleged and that, in any event, it was protected by exemption clause in the DMC. M. Issue 6 - Remedies & Quantum 215.Were I wrong on Issue 1, for reasons in this section, I would have ruled that the remedies sought by the Applicant against R1 are not open to him and that the quantum sought by him against R1 unreliable, unreasonable and excessive. (M1) Mesne profits for the Encroachment 216.In making a claim of “mesne profits” against R1, the Applicant seeks to rely on clause 7 in Section J, which reads:
217.The Applicant submitted that all mesne profit payable by R1 for its alleged breach of duty should go to “Estate Capital Fund” by reason of the aforesaid provision. 218.I agree with R1 that the above claim (and reliance of the aforesaid clause) by the Applicant is misplaced.
(M2) Account of profit for the Encroachment 219.The Applicant alleges that, by reason of the Encroachment, he is also entitled to make a claim against R1 for “account of profit” on the basis of unjust enrichment. 220.This claim, I also agree with R1, is plainly misconceived at law for the following reasons: -
(M3) Misrepresentation for deprivation of access to “Commercial Common Areas” 221.Had the Subject Areas been “Commercial Common Areas”, the Applicant complained of being deprived of access to these areas for about 22 years by reason of R1’s alleged misrepresentation. 222.This alleged misrepresentation claim against R1 is, I agree with Mr Ismail, also misconceived.
(M4) Quantum (i) The Encroachment 223.For the Encroachment, the Applicant calculated, and put forward, his total claim of $27,919,510 against R1 by way of the following heads and periods[83]: -
224.There are, I agree with R1 and R2, the following evidential problems with the various heads above. 225.For head (1), the Applicant produced i) photos capturing kiosks erected at G/F Entrance on a total of mere 76 days from March to June 2017, ii) extract of minutes of one meeting of owners of the Estate held in July 2017, whereby it was recorded that R1 had “recently” received complaints from owners and residents of alleged obstructions of G/F Entrance caused by kiosks, iii) minutes of OC meeting dated 18 December 2018 recording such complaints, and iv) emails of similar complaints received by R1 in June 2021. 226.The above documents are, I think, insufficient to allow the Applicant to prove head (1), whose claim went back as early as 2009. 227.For head (2), the Applicant produced a lease offer dated 30 June 2008 to let G/F Shop G02 to The Dairy Farm Co. Ltd. for 5 years from 1 May 2008 to 30 April 2013 (the 2008 Offer) at different monthly rentals varying over each of the 5 years (increasing from $290,000 in year 1 to $380,000 at year 5) registered at the Lands Registry. 228.The Applicant apparently deduced the total areas of (1) G/F Shop G02 (at 858.56m2), (2) Former GF Corridors occupied by G/F Shop G02 (at 184.6m2) and (3) Former GF Corridors occupied by G/F Shops G03-5 and G07 (at 39.49m2) by taking measurements from the Approved Building Plans of G/F of the Estate and making his own calculations thereafter using such measurements[87]. 229.Using the rents in the 2008 Offer, the Applicant arrived at a mean monthly rental of $333,600. Applying total area of 858.56m2 he obtained for G/F Shop G02 from his measurements and calculations, he arrived at unit rate of $388/month per m2 for G/F Shop G02. He then applied a “discounted” monthly rental of $250/month per m2 to the total area of 184.6m2 he obtained from his measurements and calculations to arrive at mesne profit for such portion of Former G/F Corridors occupied by tenant of G/F Shop G02 over the 9 years from 2000 to 2008. 230.Assuming the Applicant could have taken his measurements from the Approved Building Plans of G/F of the Estate and made his subsequent calculations correctly, it is, I think, “arbitrary” for him to “discount” as he did and using the “reduced” monthly rent of $250/month per m2 over a 9-year-long period dating back to 2000. 231.On land search record of “G/F Commercial Accommodation” of the Estate before me, a lease of G/F Shop No.2 to The Dairy Farm Co. Ltd. was registered as encumbrance on 26 November 2002[88]. According to the entry, the lease was for 3 years from 1 May 2002 to 30 April 2005 at monthly rental of mere $101,700. Applying total area of 858.56m2 obtained by the Applicant, the unit rate was mere $118 per sq m and not as high as $250 per m2 adopted by him. 232.The above suffices, I think, to show that Applicant’s figures for head (2) are arbitrary, unreliable and excessive. 233.For head (3), the Applicant used the same “discounted” unit rate of $250 per m2 for head (2) over the same 9-year-period to arrive at mesne profit for such total area of 39.49m2 occupied by tenants of G/F Shops G03-5 and G07. 234.Again, this exercise of the Applicant is, I think, entirely arbitrary and unreliable. Due to their different businesses and different shop sizes, the tenant of G/F Shop No.2 could well, one thinks, have paid different amount of rentals than tenants of G/F Shops G03-5 and G07 did for this long period of 9 years. The Applicant has not produced a single document to prove the real rentals paid by tenants of G/F Shops G03-5 and G07 to R2. 235.Save for the 2008 Offer, the Applicant produced no other tenancy document regarding G/F Shop No.2. For head (4), he “arbitrarily”, I think, applied the said mean monthly rental of $333,600 he obtained from the 2008 Offer to the 12 subsequent years from 2009 to 2020 by using the percentage of 21.5% to represent the total area of 184.6m2 of Former G/F Corridors occupied by G/F Shop No.2 as compared with total size of 858.56m2 for the said shop. 236.One seriously wonders whether the mean unit rate obtained by the Applicant from the 2008 Offer remained applicable to G/F Shop No.2 during the 12 subsequent years from 2009 to 2020. The business of its tenant could well fluctuate, as did the economy of Hong Kong. 237.After expiry of the 5-year term in the 2008 Offer, renewal could well be made on different terms. On land search record of “G/F Commercial Accommodation” before me, a tenancy agreement of G/F Shop No.2 to The Dairy Farm Co. Ltd. for 6 years from 1 May 2016 to 30 April 2022 was registered on 4 August 2017[89]. The rental thereof cannot be seen from the encumbrance entry. 238.For the above reasons, the quantum of Applicant’s head (4) is also, I think, doubtful. 239.Again, for head (5), the Applicant, I think, “arbitrarily” applied unit rate of $388.56 he obtained from G/F Shop No.2 using the 2008 Offer to the following 12 years to arrive at mesne profit of total area of 39.49m2 occupied by tenants of G/F Shops G03-5 and G07. 240.For similar reasons given for other heads above, the quantum of Applicant’s head (5) cannot, I think, be reliable either. (ii) Damages for misrepresentation for depriving access to “Commercial Common Areas” 241.Moving to Applicant’s misrepresentation claim against R1 for deprivation of access to “Commercial Common Areas”, he calculated, and put forward, his total claim of $30,598 by asking for $3.8 per day for 22 years (366 days per year)[90]. 242.Looking at the above calculations, one cannot but conclude that there is another arbitrary claim put forward by the Applicant without any reasonable basis. 243.Hence, were I wrong on Issue 1, I would have held that:
N. Disposition 244.As I accept Rs’ Contentions on Issue 1 at [195] above, I dismiss Applicant’s entire application as against both the 1st and 2nd Respondents. Solicitors for the 2nd Respondent do draft, file and serve all orders in this Judgment. 245.Were I wrong to have decided Issue 1 as I did above (i.e. were A’s Contentions the right answer to Issue 1), I would have:
246.Costs of this application are at the discretion of the Land Tribunal[91]. The ordinary rule after trial is that costs follow the event (i.e. the losing party is liable to compensate the winning party the costs incurred by the latter), except where it appears in the circumstances that some other order ought to be made[92]. This Tribunal in exercising its discretion as to costs shall take into account, among others, conducts of the parties before the proceedings[93]. 247.Prima facie, the Applicant being the losing party, he ought to pay the winning parties i.e. R1 and R2 the costs of this application. 248.Nevertheless, I think I can, and should, take into account the following conducts of R1 and/or R2 in making the appropriate costs order of this application.
249.At all material times, the Applicant was, I think, genuinely misled by the DMC and CA Assignment (and supported by, he thought, C&K Opinion) about existence of “Commercial Common Areas” (and so was C&K). His commencement of this application against R1 cannot reasonably, I think, be faulted, especially in view of what CA said at [23] of CA Judgment. 250.However, the Applicant ought, I think, to have aborted this application after he was supplied by R2 in these proceedings with the material evidence of Chau[95]. 251.For the reasons in this section, I make orders nisi as to costs of this application as follows:
252.The above cost orders nisi shall become absolute if no party applies to vary them within 14 days of this Judgment. P. Interpretation of this Judgment 253.Should the Applicant require interpretation of this judgment by court interpreter, he should approach my clerk to arrange appointment for the same and he should attend such appointment bringing with him Chinese translation of the DMC and CA Assignment. 254.Finally, I thank all parties for their industry and submissions
The Applicant, acting in person, present Mr Justin Ismail, instructed by Woo Kwan Lee & Lo, for the 1st Respondent Mr C.Y. Li SC leading Mr Li Pak-hei, instructed by Deacons, for the 2nd Respondent [1] The Applicant identified the Subject Areas on two G/F plans marked by him at pp.654 and 668 of the Trial Bundle (TB). [2] The owners of the Estate have so far not incorporated into an owners’ corporation. [3] Tseung Kwan O Town Lot No.49 [4] Siu Ka Nang and Leung Suk Yin [5] Clause 3(a) of Part II of 2nd Schedule. All references in this Judgment to clauses, or sections, are references to clauses, or sections, of the DMC unless otherwise stated. [6] See Paragraph 20 of Land Office Circular Memorandum No.91 dated 15 October 1987. It was only so required in revised guidelines issued about 3 months after the making of the DMC, see paragraphs 3(a) and 3(b) of Land Office Circular Memorandum No.41 dated 29 June 1999 [7] This declaration is the only relief that the Applicant sought against R2. He sought as against R1 all reliefs he claimed in his notice of application. He belatedly sought in his closing submissions additional reliefs, whose claim will not be considered by this tribunal in this judgment. [8] LDBM 142/2017 [10] CAMP 4/2019, [2019] HKCA 515 [11] CACV 222/2019, [2020] HKCA 448 [12] These irrelevant matters will, of course, be disregarded by this Tribunal. [13] See G/F Entrance marked by the Applicant in G/F plan produced at p.654 of TB and the kiosks areas thereon also marked by the Applicant in another G/F plan produced at p.668 of TB [14] See Former G/F Corridors marked “Shopping Arcade” by the Applicant in G/F plan produced at p.654 of TB and extension areas of Shop G02 also marked by the Applicant in another G/F plan produced at p.668 of TB [15] The Applicant said in the box that he was last employed by R1 20 years ago and that he retired in about 2010. [16] At p.84 of TB [17] The Applicant was then an owner attending meeting of OC. He raised the matter of Former G/F Corridors being encroached upon. See minute of OC at p.450-452 of TB. [18] These shall be fully discussed in section about “Remedies” below. [19] The general rule is that the party who asserts must prove: Phipson on Evidence, 20th Edition, paragraph 6-04. [20] If R1/R2 elects, it must prove its different (or contrary) factual versions on the same standard of “balance of probabilities”. [21] E.g. A factual assertion of some event said to have happened in the past is proven (or accepted by a tribunal of facts to have happened) if, after consideration of all evidence adduced at trial by all parties, including evidence supporting its happening and evidence against its happening, the tribunal is satisfied that it is “more likely than not” that the said event has happened in the past. [22] Leung did write on behalf of R1 to the Applicant (as chairman of the OC) on 6 May 2016 that “a plan of the Estate (大廈圖則)” was now deposited at customer service counter of the Estate for owners’ inspection. However, paragraph 10 of C&K Opinion reads: “We note that there is no plan annexed to the DMC”. [23] E.g. ramp at G/F for the disabled to access the Mall in lieu of staircase of Grand Entrance, marked by Hung in red in exhibit “R2” [24] Marked BD Ref No.BD 2/9170/1995 [25] Chau gave evidence to that effect but the Applicant did not see fit to cross-examine him. Having regard to 1/F podium plan and 2/F plan of 2009 CA Plans at pp.990 & 991 of TB and wordings of SC(12) of the New Grant, I accept Chau’s evidence on this point. [26] I accept the undisputed evidence of Chau in this respect. [27] p.690 of TB [28] And a smaller shop G04 to the right of shops G03. [29] p.668 of TB [30] Wellcome Supermarket [31] McDonald restaurant [32] which date was likely before the opening of the Mall in 1999 [33] p.940 of TB. Basement plan of the Brochure was marked with these words at bottom left: “All plans are subject to amended plans to be approved by the Government”. But, in terms of G/F shop configuration, the Approved Building Plans are the same to G/F plan of the Brochure. [34] The Applicant did not see fit to cross-examine Hung on this aspect of her evidence. [35] For its location, see exhibit “R1” marked by Hung [36] Photo at p.964 of TB [37] Photo at p.965 of TB [38] Today, card readers are installed at the 2 Doors. Only residents can access the 2 Doors using resident cards. That is common evidence of Hung and of the Applicant and I accept that. [39] This very small uncovered area of the Mall is marked yellow by Hung in G/F plan found at p.955 of TB. R2 could, I think, either have consented or acquiesced on its use by residents of Tower 2 over the years. [40] I agree with Hung that R2 may have acquiesced, and granted implied licence, to residential owners of the 2 Towers (including the Applicant) taking such route. [41] p.972 of TB; the 2 lobbies are called “entrance hall”. [42] p.973 of TB [43] E.g. building works on superstructures have commenced on 10 February 1997 and constructions on site are up to 7/F on Tower 1 and 8/F on Tower 2 as at the date of the said certificate. [44] p.978 of TB [45] p.983 of TB [46] The Applicant did not see fit to cross-examine or attack Chau’s evidence in this and preceding paragraphs when Chau was in the box. After Chau left the stand, he belatedly cross-examined Hung and Leung on these matters when they were not maker of the same. With respect, Applicant’s attack came, I think, too late and was directed against the wrong witnesses. [47] The first and second ACs were registered with Land Registry as exhibits to the SD. [48] For one obvious reason, Applicant’s calculations are, I think, also fundamentally wrong. There are 7 shops marked and shown on G/F plan of the Approved Building Plans. [49] There is no definition of “Residential Accommodation” in the DMC. [50] Cap.344 [51] No undivided share was allocated in Part 1 of First Schedule to “Common Services and Facilities”, nor was the same assigned to R1 by CA Assignment. [52] “Club House” was not defined in the DMC. [53] whether the PPW on UG/F is part of the common areas of the Estate: [2] of CA Judgment [54] [2] of CA Judgment [55] CAMP 4/2019, [2019] HKCA 515 [56] pp.987-996 of TB [57] Mr Chau’s memory was unclear, and failed him, on this point. He erroneously thought that LINK had by then taken over R2 when it had not. [58] See definition of “owner” in the DMC at [102] above. I believe that R1 was registered at the Land Registry as “owner” of the said 733 shares attributable to “Common Areas” after the CA Assignment was registered [59] Para 17 & 32(1) of C&K Opinion [60] Para 18, 19, 29 & 32(2) of C&K Opinion [61] The said word is coincidentally also marked and found on the Approved Buildings Plan of G/F of the Estate: see [77] above. [62] It opens with the words of “unless the context otherwise requires”. [63] Pierhead Garden Management Company Limited v The IO of Pierhead Garden [2021] HKCFI 678 at [72] per K Yeung J., citing Jumbo King, supra, as illustration [64] E.g. [23] of CA Judgment reproduced at [29] above [65] See also para 14(3) of Amended Notice of Opposition of the 2nd Respondent [66] Only owners of “Commercial Units” enjoy the right to go over “Commercial Common Areas”. Only owners of Residential Unit enjoy the right to go over “Residential Common Areas”. Only owners of Carpark enjoy the right to go over “Garage Common Areas”. [67] The Applicant erroneously thought that the right of co-owners to possess each and every part of the co-owned land due to unity of possession at common law survives after execution of the DMC when the whole purpose of executing the DMC is to restrict the exercise of such common law right to such limited extent allowed by the DMC: see CA Judgment reproduced at [120] above. [68] The said definition in the DMC could well be applied, and repeated, in any sub-Deed of Mutual Covenant. Other definitions of the DMC that could well be repeated in Sub-Deed of Mutual Covenant may include “Commercial Common Service and Facilities”. [69] IO of Pierhead Garden, supra, at [71] per K Yeung J. [70] It could, one thinks, be catered for by, for example, a proviso to the said definition. [71] Metro City Management Limited v Tsui Fee Hung Vincent & Lam Wai Fun, unreported, HCA 4327/2003, 13 January 2005, at [50] per Recorder Chan [72] Central Management Limited v Light Field Investment Limited and Others [2011] 2 HKLRD 34; Metro City Management Limited v Tsui Fee Hung Vincent and Lam Wai Fun, unreported, CACV 328/2005, 6 June 2006; 永利工業大廈業主立案法團 v順隆置業有限公司 [2021] HKLdT 26 [73] The Applicant confirmed in the box he does not own any carpark in the Estate. [74] Clause 2 in Part I of Second Schedule [75] It relates to owner(s) being authorized to sue defaulting “owner” and not defaulting “manager”. Hence, this clause cannot assist R1. [76] Clause 6 of Section H, clause 1(b)(xxv) of Section I, and clause 6(a) of Section I [77] Clause 5 of Section L [78]駱詠欣訴彭君偉[2020] HKLdT 39 at [53] [79] Para 41,47 & 48 of C&K Opinion [80] See Shanghai Tongji Science & Technology Industrial Co Ltd v Casil Clearing Ltd (2004) 7 HKCFAR 79 at [66] – [68] [81] Cap.284 [82] [2013] 2 HKLRD 131 [83] See Re-Amended Notice of Application at pp.17 to 21 of TB [84] Wellcome Supermarket (according to directory of the Mall in April 2019 at p.690 of TB) [85] Honolulu Café (according to directory of the Mall in April 2019 at p.690 of TB) [86] TKO Family Medical Centre (according to directory of the Mall in April 2019 at p.690 of TB) [87] The said calculations are found at p.669 of TB, with the words “Approved Plan Data B.D. 2/9170/95” put down at its top right. [88] Memorial No.SK537641, at p.552 of TB [89] See Memorial No.17080400560362 at p.554 of TB [90] See Re-Amended Notice of Application at p.25 of TB [91] S.12 of Lands Tribunal Ordinance, Cap.17 [92] O.62 r.3(2), Rules of High Court, Cap.4A [93] O.62 r.5, Rules of High Court, Cap.4A [94] On minutes of OC meetings produced, R2 had apparently appointed its representative(s) to OC at all material times. The OC shall consist of no more than 2 members as representative of the Commercial Development: clause 2(b)(iii) in Section G. [95] Chau’s witness statement was filed on 3 November 2021. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cases cited in this judgment
Further hearings and rulings under LDBM 61/2020