Chau Tat Wing, Suing in His Own Capacity and As the Sole Executor of the Estate of Wong Tim Lun, Deceased v. Wong Kwai Wan and Another

DCCJ 3244/2022

[2025] HKDC 517

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 3244 OF 2022

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DECISION

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1.This court has handed down the judgment on 12 December 2024 (“the Judgement”) to dismiss the plaintiff’s claim and the 2^nd defendant’s counterclaim. The court further made a cost order nisi that the plaintiff shall pay the costs of this action to the 1^st and 2^nd defendants to be taxed if not agreed with certificates granted for one counsel each to the 1^st and 2^nd defendants.

2.The 1^st defendant took out a Summons on 23 December 2024 (“the Summons”) for, inter alia, the following:

a.  An order to vary paragraph 97 of the Judgement (“the Judgment Variation Order”);

b.  An order to vary the cost order nisi in paragraph 98 of the Judgment (“the Costs Variation Order”); and

c.  An order for the sanctioned payment by the 1^st defendant be paid out (“the Payment-out Order”).

The Judgment Variation Order

3.In the current action, the 1^st defendant has made a counterclaim against the plaintiff (pages 54 - 55 of the Hearing Bundle):

“(1) Delivery of vacant possession of the Area to the 1^st defendant;

(2) Mesne profits in respect of the Area at market rate for the period from September 2012 until the date of delivery of vacant possession of the Area to the 1^st defendant;

(3) Interest at such rate and for such period as the court deems fit…”

4.The Judgment, under paragraph 97, has ordered that the plaintiff’s claim against the 1^st and 2^nd defendant be dismissed and that the 2^nd defendant’s counterclaim be also dismissed, but there is no order regarding the 1^st defendant’s counterclaim. The Judgment has not been drawn up as yet.

5.There is no dispute that this omission in the Judgment is an obvious mistake. The legal principle for such situation is that:

“Beyond correcting any “slips or omission”, before an order for the judgment has been drawn up or perfected, the court has a wider power to rectify mistakes in the judgment…” (Ng Cheuk Hang v Wams Design Ltd [2022] 1 HKLRD 587)

“The court court’s jurisdiction to reconsider its judgment before its order had been perfected could only be exercised in a case which raised considerations, in the interest of justice, which were…exceptional. An exceptional case did not have to be uniquely special, and “strong reasons” was perhaps an acceptable alternative to “exceptional circumstances”…There were, of course, cases where an error of fact or law might be too plain for argument, and it was better that the error was corrected without imposing on the parties the need for an appeal…” (per Woo JA in the court of Appeal case of Sun Jianqiang v Trans-Island Limousine Service Ltd [2004] 1 HKC 533)

6.Indeed, this court has already considered the 1^st defendant’s counterclaim when drafting the Judgment. The crux of the Judgment was that the 2^nd defendant (the Director of Lands) has already rejected the EGS Survey and adopted the 2012 Survey as the boundary records it would maintain under clause 4(a) of the Land Survey Ordinance, Cap 473 (“the LSO”). As such, it is no business of the court to provide an “alternative forum” to override such the decision when this was not in form of a Judicial Review action challenging any procedural defects. Further, under clause 28 of the LSO, the responsibility for the accuracy of the boundaries lies with the authorized land surveyor, who is not a defendant in this action. Thus, the claims against both the 1^st and 2^nd defendants were entirely misconceived. (paragraphs 32-42, 63-67 of the Judgment)

7.The Judgment, in dismissing the 2^nd defendant’s counterclaim, also repeats the same position: it is no business of the court to declare the accuracy of a survey map. Any dispute in such should lie in a claim of negligence (amongst any other causes of action) against the authorized land surveyor who produced the disputed survey map (paragraph 96 of the Judgment).

8.Given this decision, I find it strange that Mr. Kelvin Leung, counsel for the plaintiff, sought to argue that the 1^st defendant’s counterclaim for vacant possession was somehow unenforceable because the court has not determined “where the true common boundary lies”.

9.Further, Mr. Leung argued that, since the Judgment stated that the court has no jurisdiction as an adjudicator of the accuracy of various survey reports, the court has not decided whether the 2006 or the 2012 Survey Plan is more accurate. As such, neither Survey Plan has any legal effect.

10.I would explain, as I have already done so during the hearing, that it is no business of the court to, figuratively, invite the parties to attend the site and draw the boundary on the ground with a chalk pen. In my view, whilst the court has no jurisdiction to adjudicate which survey plan is “more accurate”, it, of course, has the jurisdiction to enforce the boundary according to the survey map currently maintained by the Director of Lands under clause 4(a) of the LSO.

11.Accordingly, the court finds that the boundary between the plaintiff’s and the 1^st defendant’s land (amongst other boundaries) is determined by the current records maintained by the Director of Lands, i.e. the 2012 Survey Plan. This showed that the Area as defined in the 1^st defendant’s Re-Amended Defence is within the 1^st defendant’s land. It is not disputed that the plaintiff has constructed a wall on the Area so it must follow that the court finds for the 1^st defendant’s counterclaim for trespassing.

12.As for the counterclaim for the mesne profit, the 1^st defendant has not provided any evidence to support any “market rate” during the trial. It is a small area in any case so I would not make any award.

13.Accordingly, the court will give the order to amend paragraph 97 of the Judgment to read:

I would order that P’s claim against D1 and D2 be dismissed. D2’s counterclaim is also dismissed. I would further order that P shall, within 28 days of this Judgment, deliver vacant possession of the Area as described under paragraph 4(f) of D1’s Re-Amended Defence and as shown accordingly in the copy plan annexed in the same.

The Costs Variation Order

14.Under paragraph 2 of the Summons, the 1^st defendant applied for:

(1)  The plaintiff do pay the 1^st defendant’s cost of the action before 11 July 2022 at High Court scale;

(2)  The plaintiff do pay the 1^st defendant’s costs of the action, including all costs reserved, on indemnity basis with certificate for counsel, to be taxed if not agreed; and

(3)  The plaintiff do pay the 1^st defendant’s enhanced interest on costs at the rate of judgment rate plus 5% p.a. until the date of Judgment to be taxed if not agreed.

15.This action was commenced in the High Court and was transferred to the District Court on 12 July 2022 by the order of Madam Justice Au Yeung.

16.The 1^st defendant sought that the costs to be on High Court scale prior to the date of transfer and this is not disputed by the plaintiff.

17.As for application for costs on indemnity basis, firstly, it is noted that the 1^st defendant has made a Sanctioned Payment on 22 March 2024 for a sum of HK$5,000 (Hearing Bundle p.206-209). The plaintiff lost his claim so clearly failed to beat the Sanctioned Payment. The 1^st defendant, at the very least, should be entitled to costs on indemnity basis after 19 April 2024 under O.22 r.23(4)(a).

18.Mr. Leung argued that “without prejudice” cover letter for the Sanctioned Payment somehow has “override and invalidated” the Sanctioned Payment.

19.This letter (Hearing Bundle p.210) stated, inter alia:

“Please take notice that if your client accepts the Sanctioned Payment, we would apply to the Court for a costs order that your client shall pay our client’s costs of the proceedings by invoking the otherwise proviso under Order 22 Rule 20(1)…on the ground that by accepting the Sanctioned Payment, your client accepts that his case on the land boundary is doomed to fail and he should not have commenced the present proceedings in the first place.”

20.It is trite law that when sanctioned payment is accepted, the prima facie rule is that the plaintiff should be entitled to costs of the action up to the time when he may accept the sanctioned payment without leave of Court unless:

a.  the defendant discharges the burden of showing exceptional circumstances that justify a departure; and

b.  he has given a prior warning to the plaintiff that he would invoke the otherwise proviso.

(per Poon J (as he then was) Etratech Asia-Pacific Ltd v Leader Printed Circuit Boards Ltd [2013] 2 HKLRD 1184)

21.Thus, Mr. Leung’s argument was again mystifying: this “without prejudice” letter was the usual and accepted practice of giving a “prior warning” to the plaintiff that the 1^st defendant would apply to court to invoke the otherwise proviso under Order 22 Rule 20(1). This notice clearly would not “override or invalidate” the Sanctioned Payment in any way.

22.Mr. Leung also argued that the Sanctioned Payment only covered the plaintiff’s claim and not the 1^st defendant’s counterclaim. Thus even if the plaintiff accepted, there would still be a trial on the counterclaim. I do not agree: the claim and counterclaim were essentially linked: if the claim is dropped, there can be no defence to the counterclaim in any case because there is no dispute that the plaintiff has been trespassing according to the 2012 Survey Report.

23.As such, if the Sanctioned Payment was accepted, and if the 1^st defendant would then apply to invoke the otherwise proviso, there would only be arguments on costs. Much costs and time would have been saved instead of having to embark on a 9-day trial.

24.In the Summons, the 1^st defendant took matters further in seeking that the court should order costs on an indemnity basis for the entire proceedings.

25.The principles governing indemnity costs orders are not in dispute.

26.In particular, the burden is on the party seeking it to show “special or unusual feature” which need not be confined to “conduct lacking in moral probity” etc. but can be conduct that was “unreasonable to a high degree”. “Unreasonable” here does not mean “merely wrong or misguided in hindsight” or conducts “in pursuit of a weak claim” (see Law Yin Pok Bosco, a minor by Lam Po Yee, his mother and next friend v Dr. Chan Yee Shing also known as Dr. Chan Yee Shing Alvin [2022] HKCFI 345).

27.Mr. Tang, the surveyor expert instructed by the plaintiff, produced an excessively long report running to almost 200 pages when his opinion can be summarised in merely 4 paragraphs in simply declaring that the 2006 Survey was a “fair determination of the common boundary” whilst failing to address the central issue of dispute (paragraphs 54-56, 75-79 of the Judgment). This is clearly inadequate. Even worst, on the 4^th day of the trial, Mr. Tang advanced a totally new theory sidestepping his earlier opinion and the joint statement. The court did not approve of this conduct. Even if this theory was examined as an academic exercise, it failed (paragraphs 83-92).

28.The plaintiff’s conduct at trial is clearly unreasonable.

29.More importantly, the court finds that the allegations raised against the 1^st defendant were entirely misconceived (paragraphs 32 to 40 of the Judgment):

a.  the allegations were unfounded and not supported by any evidence; and

b.  clause 28 of the LSO clearly showed that the 1^st defendant was the wrong party to sue for any dispute in the accuracy of a survey report.

30.Thus, the entire cause of action against the 1^st defendant was totally baseless.

31.I note that the 2^nd defendant has indicated that it is taking a neutral position regarding this Summons. However, as stated in paragraph 6 above, the allegations against the 2^nd defendant was also entirely misconceived.

32.The whole action can be summarised as the plaintiff’s attempt to bypass the procedure of the 2^nd defendant by requesting the court to act as an “alternative forum” to adjudicate on the accuracies of various survey reports. In doing so, the plaintiff completely failed to acknowledged clause 28 (4) of the LSO in taking action against the proper defendant, i.e. “the authorised land surveyor personally responsible for the accuracy and completeness of the land boundary plan signed and certified by him”.

33.The question is: does such conduct amount to a “special or unusual feature” and “conduct to a high degree of unreasonableness”?

34.Paragraph 70 of the Judgment states as much:

“I would question whether P’s legal advisers have drawn their client’s attention to clauses 28 and 33 of the LSO. If they have, I wonder how P would see that he should embark on this totally misconceived action in the wrong forum against the wrong defendants. In my view, this entire action against both defendants may amount to an abuse of court process.”

35.Arguably, there cannot be a more ill-conceived or unreasonable action than the current one. It was not a merely weak case. It was a hopeless case doomed to fail right from the beginning. The plaintiff’s legal advisers should be aware of such.

36.Against this, Mr. Leung’s argument appeared to be that if the plaintiff’s claim was so misconceived, the defendants should have applied to strike out the action. This is not a valid defence: the defendants may have their own considerations and reasons for not taking out such applications and it would be unfair and unreasonable to hold that against them.

37.As such, the court should allow the 1^st defendant to recover the costs of the entire action on an indemnity basis.

38.In addition, the 1^st defendant also applied for an enhanced interest on costs.

39.I accept that the court has discretion to include non-compensatory element to the interest award but that the level must be proportionate to the circumstances of the case (Wong Giles v Donowho Simon Christopher & Anor [2020] HKCFI 1053 and So Sin Ying v JV Fitness Ltd [2024] 2HKC 596).

40.Given the above considerations, I am of the view that this case calls for the exercising of such discretion.

41.In the 1^st Defendant’s skeleton argument, Mr. Leon Ho wishes to seek enhanced interests from the date that the 1^st defendant pays his solicitors a costs on account for a sum of HK$1,000,000 (which was on 20 April 2024, 2 days before the trial commenced) to the date of judgment (receipt enclosed at p.221-222 of the Hearing Bundle).

42.This is adopting the “traditional approach” of making the calculation of interest for the item of costs from the actual date of payment to the date of judgment (Cheung Hon Kin v Chubb Life Insurance Company Ltd (formerly known as NEW YORK LIFE INSURANCE WORLDWIDE LTD and ACE LIFE INSURANCE COMPANY LTD respectively [2024] HKCFI 3623). This is appropriate given that we are only dealing one item of payment of costs.

43.I have considered the precedents regarding the appropriate enhanced interest (the Cheung Hon Kin case and the So Sin Ying case) and I agree with Mr. Ho’s proposal that the interest rate of judgment rate plus 5% should be appropriate for the circumstances of this case.

The Payment-out Order

44.Given that the court found for the 1^st defendant in the Judgment, it must follow that the sum of HK$5,000 of the sanctioned payment made by the 1^st defendant on 22 March together with the interest accrued thereon (if any) be paid out of Court to the 1^st defendant forthwith through his solicitors Messrs. Leung & Lien Solicitors.

Order

45.In conclusion, I will give an order to amend paragraph 97 of the Judgment as stated in paragraph 13 above and I will also give an order in terms of paragraphs 2(1), 2(2), 2(3) and 3 of the Summons.

46.As for costs, I would order that the costs of and occasioned by the Summon be paid by the plaintiff to the 1^st defendant forthwith on an indemnity basis to be assessed summarily by way of paper disposal. The 1^st defendant has already submitted a statement of costs for Summary Assessment. Accordingly, the plaintiff shall have 14 days from the date of this Decision to lodge and serve a summary list of objections.

Mr Kelvin Leung, instructed by Messrs Li, Kwok & Law, for the plaintiff

Mr Leon Ho, instructed by Messrs Leung & Lien, for the 1^st defendant