Tang Chiu Man and Another v. Secretary for Justice for Director of Lands
Read the full judgment text of HCAL 68/2021 on BabelCite. This High Court CFI judgment was delivered on 22 August 2025.
1. At the core of the Applicants’ case is an allegation of bad faith, that the Respondent Director of Lands (“Director”) acted with an ulterior motive in his dealings with them and in the decision he made. The central question is whether the allegation of bad faith is enough to make the impugned decision amenable to this Court’s supervisory jurisdiction, when in ordinary circumstances it likely would not be.
Cited by 3 cases · Cites 18 cases
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HCAL 68/2021 [2025] HKCFI 3253 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST NO 68 OF 2021 ________________________
________________________ AND HCAL 916/2021 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST NO 916 OF 2021 ________________________
________________________ (Consolidated pursuant to the Order of Honourable Mr Justice Coleman
____________________ J U D G M E N T ____________________ A. Introduction 1.At the core of the Applicants’ case is an allegation of bad faith, that the Respondent Director of Lands (“Director”) acted with an ulterior motive in his dealings with them and in the decision he made. The central question is whether the allegation of bad faith is enough to make the impugned decision amenable to this Court’s supervisory jurisdiction, when in ordinary circumstances it likely would not be. 2.The 1st Applicant (“Mr Tang”) is the husband of the 2nd Applicant (“Ms Lam”), who was the former Assistant Director of Lands. Together, they are owners of two Lots of land in the New Territories (“Land”). On 10 October 2012, the Applicants made an application to the Lands Department (“LandsD”) for the rebuilding of 4 New Territories Exempted Houses (“NTEHs”) on the Land. There is no dispute that the NTEH application was an application for approval under a lease, being the Block Crown Lease (“BCL”). The NTEH application was not an application for modification of lease. 3.The impugned decision (“May Decision”) was given by the Director on 21 May 2021, to impose 33 conditions on the Applicants’ application to build the 4 NTEHs. The May Decision is challenged in HCAL 916/2021 (“JR2”). The May Decision was itself a revision to an earlier decision (“February Decision”) which had imposed 38 conditions. 4.But there is an earlier challenge made in HCAL 68/2021 (“JR1”). That came about because the Applicants waited a long time – around 8 years – for their application to be determined by the Director. Hence, they issued an application for leave to apply for judicial review in January 2021, targeting the Director’s failure to determine their application with due dispatch. It is notable that the February Decision came very quickly after JR1 was issued, and it would be easy to think it was triggered by it. 5.By my Decision dated 11 October 2021, [2021] HKCFI 3016, I ordered that the hearing for leave to apply for judicial review in both proceedings be heard together before the same judge. By my Decision dated 6 December 2021, [2021] HKCFI 3518, I gave leave to apply for judicial review in both JR1 and JR2 (“Leave Decision”). 6.The Applicants’ substantive applications for judicial review in respect of the delay and the May Decision were heard over two days. At the hearing, the Applicants were represented by Ms Audrey Eu SC, leading Mr Andrew Tse of Counsel. The Director was represented by Mr Abraham Chan SC, leading Mr Gary CC Lam of Counsel. At the end of my hearing, I reserved my decision. 7.This is my Judgment. B. Factual Narrative B.1 The Parties and the Land 8.As stated, Ms Lam was formerly the Assistant Director of Lands, and the wife of Mr Tang. By way of an assignment dated 20 July 2012, the Applicants became owners of Lots 1504 and 1505 in DD 112, Yuen Long, New Territories (i.e. the Land). The Land is subject to a BCL. 9.At the time of the purchase of the Land, it contained existing structures. The Applicants wished to rebuild these existing structures into 4 NTEHs, which would be let out. 10.According to the BCL, the user descriptions of the Land were “padi” and “waste”, signifying the Land was to be regarded as “agricultural land”. At first glance, no “house” (for residential purposes) could be built on it. However, it is undisputed that, according to the Rent Roll Record administered by the District Lands Office, the government rent on part of Lot 1504 (0.04 acre) and the whole of Lot 1505 (0.02 acre) were charged on a “house” basis, indicating that it is housing land. For all intents and purposes, this means that at some point the Government had amended the use of the Land and permitted the building of houses on 0.04 acre of Lot 1504, and 0.02 acre of Lot 1505. 11.The Land also fell within an area zoned ‘Agriculture’ on the Shek Kong Outline Zoning Plan No. S/YL-SK/9 (“OZP”). The remaining parts of the Land fall within an area zoned as a ‘Conservation Area’. 12.Thus, to build the NTEHs, the Applicants had to make two relevant applications. The first was pursuant to section 16 of the Town Planning Ordinance Cap 131. The second was to apply to the LandsD for approval or permission to rebuild the NTEHs under the BCL. If the LandsD approves the rebuilding of the NTEHs, the Applicants would be invited to apply for Certificates of Exemption (“CoEs”) under the Buildings Ordinance (Application to The New Territories) Ordinance Cap 121 (“Cap 121”). 13.For present purposes, the crux of the present proceedings concerns the second application. There are two further matters concerning this “second application” that are more conveniently dealt with here. 14.First, it is not disputed that the Applicants could, instead of applying for CoEs from the LandsD, have chosen to proceed under the Buildings Ordinance Cap 123 (“Cap 123”), in which case approval would be dealt with and granted by the Buildings Department, rather than the LandsD. However, this route – as admitted by the Applicants – is less “convenient”. If the Applicants were to obtain CoEs, they would be exempt from certain requirements for constructing NTEHs under Cap 123, which would lower the cost of construction. Indeed, the evidence shows that the Applicants at all material times intended to apply for CoEs from the LandsD. 15.Second, the Applicants and the Director hotly dispute whether the application involves “two” stages. According to the Applicants, the first stage is to apply for approval under the BCL, when the LandsD would consider (1) whether the Applicants are the owners of the Land, (2) whether the proposed NTEH(s) is/are within the boundary of the Land, (3) any applicable lease restrictions, and (4) the zoning of the land under the relevant Outline Zoning Plan (“Stage 1”). If the LandsD is satisfied of those matters, it moves onto the second stage: i.e. to consider the CoEs (“Stage 2”). 16.The Applicants further contend that it is only under Stage 2 that the LandsD is required to consider more technical information. The Applicants thus contend that (amongst other things) the LandsD took into account irrelevant considerations when raising several queries before approving the Application, and in then imposing 33 conditions in the May Decision at Stage 1. 17.I will come back to this later when discussing the substantive merits of the Applicants’ grounds of review. B.2 The Application 18.On 12 October 2012, the Applicants’ consultants, Lanbase Surveyors Limited (“Lanbase”), wrote to apply for a license to build the 4 NTEHs. A formal application was eventually submitted on 29 April 2013 (“Application”). The Application was handed over to the New Territories Action Team 1 (comprising the Assistant Director/Estate Management, Principal Land Executive, and Chief Land Executive), and later the Rebuilding Team of Village Improvement and Special Duties Section of the LandsD. Both teams operated independently within the LandsD. 19.From 12 October 2012 to July 2014, it is undisputed that the Application was processed smoothly. 20.During this period, the LandsD had asked the Applicants to submit various pieces of supplementary information, including a “setting out plan (1:1000) prepared by an Authorized Land Surveyor showing the dimensions and coordinates of the proposed houses, balconies and the septic tanks” and “Survey Record Plans” in respect of the Land. 21.The Applicants also submitted two further proposals whereby the size, siting, and layout of the proposed NTEHs were different than the one submitted on 12 October 2012 as part of the Application. The first further proposal (“2nd Housing Proposal”) was submitted to the LandsD on 25 September 2013. The second further proposal (“3rd Housing Proposal”) was submitted to the Town Planning Board (“TPB”) on 21 May 2014 as part of the application under section 16 of the Town Planning Ordinance (“TPO”), which was eventually approved on 25 July 2014 (“1st TPB Application”). 22.The Applicants made the 3rd Housing Proposal on the basis that they could build the NTEHs on any 0.06 acre of the Land. They thought this to be the prevailing approach to cases where the Government is unable to locate the documents which evidenced the change of use of the Land from “agricultural land” to “house”. They call this the “missing lease” approach or classification (“Missing Lease Approach”). 23.The Applicants claims that the TPB accepted that the NTEHs could be built on any 0.06 acre of the Land. Further, they claim that this was also accepted by the LandsD as well by virtue of the latter’s comments in paragraph 8.1.1(a) RNTPC Paper No. A/YL-SK/201 dated 25 July 2014 (“RNTPC Paper”) under which the First TPB Application was accepted. The LandsD refutes this. I will come back to this later. B.3 The Press Incident 24.After the Applicants submitted the First TPB Application, their purchase of the Land became public knowledge, which prompted Ming Pao Daily (“Ming Pao”) to lodge several questions with the LandsD concerning the Applicants’ purchase. 25.Ming Pao followed up on their inquiries. On 6 August 2014, it published a front-page story – headlined (“地政高官管轄範圍買巨地 – 毗鄰規劃中新市鎭 涉嚴重利益衝突”). Essentially, it alleged that Ms Lam had taken advantage of insider information (namely, that the Development Bureau had planned to develop Kam Tin, Yuen Long into a new town for 100,000 inhabitants) and could earn an estimated profit of HK$50 million by purchasing the Land (“Report”). 26.After the Report was published, Ms Lam said that she had formed the impression during meetings that the then Director, Ms Bernadette Linn, believed she was in the wrong, and that her relationship with the LandsD had “deteriorated quickly”. 27.The Independent Commission Against Corruption and the HKSAR Government commenced investigations against Ms Lam from August 2014 onwards. The detail need not be repeated here. It is important to note that she was eventually cleared by both entities of all allegations of misconduct, in March 2015 and in June 2017 respectively. B.4 The Impact of the Report on the Application 28.According to the Applicants, however, the Report still had a negative impact on their Application. 29.The Applicants contend that after its publication, they were subject to unusual treatment. On 7 August 2014, they were asked to demolish all existing structures on the Land in the absence of any complaints. On 28 September 2014, the Applicants made an application for agricultural structures to be erected on the Land – but it was only approved after 6 months (rather than 1 or 2 months). 30.According to the Applicants, the high point of the “unusual” treatment was when they were subject to various requisitions from the LandsD (“Requisitions”) across a span of 7 years. The Requisitions were made by the LandsD against the following background.
31.While the LandsD made the various Requisitions, it also consulted the public on 19 December 2018. On 10 July 2019, the LandsD informed the Applicants that it had dismissed 11 out of 12 public objections, except one relating to fung shui. On 11 October 2019, this was ultimately considered at the Yuen Long District Lands Office Conference (“YLDLOC”) and overruled. 32.After (amongst other things) the Requisitions were satisfactorily answered and the LandsD obtained “all necessary information”, the LandsD submitted the Application to the YLDLOC for its deliberation on 20 May 2020. The YLDLOC recommended the approval for the rebuilding of the NTEHs, subject to (amongst other things) conditions concerning development, balconies, canopy and windows/openings and projections. 33.Time marched on. The Applicants’ solicitors had written to the LandsD on 2 April 2020 and 30 July 2020 twice to “chase” the LandsD for the determination of the Application. But the LandsD had yet to approve the Application. According to the LandsD, the reason for this delay was because it had to seek legal advice from the Department of Justice as well as the Land Registrar during this time. 34.On 20 January 2021, the Applicants decided that they had waited long enough. They took out an application for judicial review, i.e. JR1. B.5 The 38 (and later 33) Conditions 35.Coincidentally or otherwise, the Application was then determined. On 26 February 2021 – around 8 years after the Application was first lodged – the LandsD approved the Application, but with 38 conditions. Aggrieved, the Applicants wrote back on 7 April 2021, explaining why the conditions were not acceptable. 36.On 21 May 2021, the LandsD wrote back and reduced the number of conditions from 38 to 33, i.e. the May Decision. 37.Still dissatisfied, the Applicants commenced JR2 on 25 June 2021. The Applicants contend that the Decision, or at least some of the 33 conditions (“Conditions”) in the Decision, should be quashed due to various public law irregularities. 38.The Applicants zero in on the following 22 Conditions (“Challenged Conditions”).
39.Further, the Applicants were required to provide an undertaking and signify their understanding as per Appendices II and III of the letter that contained the May Decision. C. Grounds of Review 40.In their Form 86 for JR1, the Applicants advance 3 grounds of review in light of the LandsD’s failure to determine the Application prior to 26 February 2021:
41.In their Form 86 for JR2, the Applicants advance no less than 9 grounds of review. They are as follows:
42.For JR1, the Applicants seek an order of mandamus for the Director to determine the Application. In contrast, for JR2, the Applicants seek to quash the May Decision and an order of mandamus for the reconsideration of the Application. 43.In both JR1 and JR2, the Applicants seek damages pursuant to section 21K of the High Court Ordinance Cap 4 and Order 53, rules 1 and 7 of the Rules of the High Court Cap 4A for imposing the Challenged Conditions for a breach of an implied term of the BCL, as derived from Braganza v BP Shipping Ltd [2015] 1 WLR 1661 at §18 – namely, that contractual discretions must be exercised in a non-arbitrary, non-capricious, and rational manner (“Implied Term”). 44.Before I address JRs 1 and 2, I must first address the two preliminary points, which could render consideration of the grounds unnecessary. D. Is JR1 Academic? 45.There was originally an issue as to whether JR1 was commenced in time, but that ceased to be an issue by the time of the substantive hearing. I can therefore run instead to the question of whether JR1 became academic. 46.In my Leave Decision, I said that I did not think that JR1 is necessarily academic, following the February Decision and the May Decision and the commencement of JR2. I referred to (1) the point that JR1 and JR2 can arguably be said to claim different aspects of damages for different periods on different bases, and (2) that it could be argued that the duties of a public body fall to be exercised on a continuing basis, and the underlying aspects of challenge in JR1 relate to that kind of point. 47.However, after full argument, I agree with Mr Chan, for the Director, that JR1 is or has become academic. 48.The gravamen of the Applicants’ complaint in JR1 was that the Application had not been determined yet and the Applicants could not proceed. But – after JR1 was issued – the Application was determined, albeit with addition of the Challenged Conditions. First, there was the February Decision, then the May Decision which revised it. The Applicants know what they have to do to rebuild the NTEHs – they either comply with the Conditions or they successfully contend that they are improper, such that the Director will drop those Conditions – which is the target in JR2. As such, the “real dispute that drove the parties to the litigation” simply was no longer in existence from the time of the May Decision (and probably even the February Decision): see Chit Fai Motors Co Ltd v Commissioner for Transport [2004] 1 HKC 465 at §20(2). 49.My view is fortified by how the primary public law remedy sought by the Applicants in JR1 – the order of mandamus to compel the Director to determine the Application – would be of no practical utility. 50.I was initially impressed by the point made by Ms Eu, that because the two JRs target two different alleged wrongs – JR1 targets the delay, JR2 targets the Challenged Conditions – the Applicants may be entitled to damages across two periods. JR1 claims damages for breach of the Implied Term from 1 July 2015, and JR2 claims damages from 26 February 2021 until the Application is ‘properly approved’. Hence, it was said that it might be of some utility for JR1 to be heard as the Applicants may be entitled to more damages as a result. But ultimately, I do not think that argument should succeed. 51.An application for an award of damages must be made together with the remedies as specified in Order 53, rule 1(1) and rule 1(2) of the RHC. The corollary is that the applicant cannot seek damages alone: see my decision in Tong Wai Yee Winnie v Secretary for Education [2023] 1 HKLRD 410 at §15. Thus, if the “primary remedy” is or has become academic, I do not think – as a matter of principle – the Applicants can rely on the ancillary remedy of “damages” so to keep JR1 “alive”. 52.I also do not think there is good reason in the public interest for JR1 to be continued through to a full conclusion. The grounds of review in JR1 are fact-specific. I cannot imagine that there might be a “large number of similar cases” where the Respondent is accused of failing to determine his or her NTEH rebuilding application because it allegedly wished to minimise political outcry or penalise the applicant – the facts of this case are apparently unique: see Chit Fai Motors at §20(3) (citing R v Secretary of State for the Home Department, ex parte Salem [1999] 1 AC 450). 53.In any event, according to the Respondent’s evidence, only 18 out of 2,561 NTEH rebuilding applications from 2016 to 2020 took 8 or more years for determination. Indeed, if delay was a common feature across most NTEH rebuilding applications, it is difficult to see how the Applicants’ core allegation – namely, that it was motivated by bad faith – has any foundation. 54.I also think that the real concerns underlying JR1 can be ventilated as relevant to the grounds made and relief sought in JR2 (see below). E. Are the JRs Amenable to Judicial Review? E.1 Grant of Leave 55.In my Leave Decision, I declined to refuse leave on the question of amenability to judicial review. 56.It seemed to me that this particular case on its facts (as asserted by the Applicants, and for the purposes of the leave application assumed in their favour) reached the arguability threshold for the grant of leave to apply for judicial review. I thought that the fact-sensitive matters might themselves be relevant to an ultimate resolution of the question of amenability, as well as to other questions as would arise on the substantive application for judicial review. Further, the degree or extent of the impact that allegations or findings of ulterior motive or bad faith might have on amenability seemed to me to be a potentially important point worthy of full exploration at a substantive hearing. 57.Nevertheless, I acknowledged the weight of prior authority which strongly supports the stance taken for the Director: see Anderson Asphalt Ltd v Secretary for Justice [2009] 3 HKLRD 215 (“Anderson Asphalt (CFI)”)at §57; King Prosper Trading Ltd v Urban Renewal Authority (unreported, HCAL 56/2009, 17 December 2010), at §§26-31; and the cases referred to in those decisions – and see, further, below. I accepted that it is authoritatively settled that a Government lease is a private lease, and ordinarily in relation to steps taken on the lease the Government is acting in a private capacity and thus not subject to judicial review. 58.I return to the question of amenability on the substantive application. E.2 Established Authorities 59.Not every decision made by a public body is amenable to judicial review. It is trite that if the role performed by the public official is an essentially private and purely commercial one – one which is no different in substance from one made by an ordinary citizen – then the decision is not reviewable under public law: see Anderson Asphalt (CFI) at §§40-41. 60.The critical question for determining whether a decision by a public body is amenable to judicial review is also settled. The source of the power is undoubtedly an important factor to take into account. But, the source of the power so exercised is not dispositive of whether a decision is amenable to judicial review: see R (Mullins) v Jockey Club [2005] EWHC 2197 (Admin) at §29; and Mauritius v CT Power Ltd [2019] UKPC 27 at §§43-45. 61.It is similarly – if not more – important to consider whether the nature of the power and the function being exercised mean the decision had a “sufficient, public element, flavour or character to bring it within the purview of public law”: Anderson Asphalt Ltd v Secretary of Justice (“Anderson Asphalt (CA)”) [2010] 5 HKLRD 490 at §§57-61. 62.What amounts to a sufficiency of public elements to render the decision-making process amenable to judicial review is a matter of fact and degree, depending very much on individual cases. Questions of amenability, like all questions of law, also depend on the relevant practical and legal context in which they arise. No hard and fast rule can be laid down. It is, in a borderline case, very much a matter of overall impression and one of degree. 63.In Anderson Asphalt (CA), where the Court of Appeal decided that the Director of Lands’ refusal to terminate short-term waivers granted to entities erecting and operating asphalt production plant on agricultural land was not amenable to judicial review by the competitors of those entities, it drew upon Hunter J’s remarks in Shun Shing Hing Investment Co Ltd v Attorney-General [1983] HKLR 432, 434 in the following terms:
64.In light of these unique advantages that the Hong Kong Government enjoys – including the financial benefit of charging premiums, its ability to dictate the pace and quality of development, and the enforcement of its terms via forfeiture – the Court of Appeal in Anderson Asphalt (CA) remarked (at §37) that the Court should examine the evidence carefully to see if the applicants have made out their case that the Government has decided to abdicate its traditional role of private landlord and has taken upon itself the role of a non-statutory planning authority, such as to expose itself to the risk of judicial review. 65.Further, it held (at §39) that precisely because the Hong Kong Government inherently combines the functions of landlord and planning authority, the mere element of planning does not turn the acts of the Director from those of a private landlord into ones within the public domain. Otherwise the Government loses its unique advantages in this jurisdiction. This was also discussed in Anderson Asphalt (CFI) at §§62, 76-78, including by reference to R (Molinari) v Kensington and Chelsea Royal LBC [2001] EWHC Admin 896 at §§58-72, a case relied on by Ms Eu and in which it was held that a decision under a lease to refuse to consent to change of user was amenable to judicial review because the authorities were exercising a statutory function by giving effect to planning policy through the contract. The point in effect leads back to the sufficiency of the public element:
66.In any event, “enlightened landlords” may also incorporate an element of planning to preserve the value of the estate: Rank Profit Industries Ltd v Director of Lands [2009] 1 HKLRD 177 at 190. In other words, planning is not an inherently “public” matter. 67.Further, it has been authoritatively determined that Government leases are private agreements. When modifying leases – or choosing whether to grant or withhold its consent to the modification of the terms of a lease – the Government acts in a private capacity. Their decisions are thus not subject to judicial review: see Hang Wah Chong Investment Co Ltd v AG of Hong Kong [1981] HKLR 336 at 341-342C; and Director of Lands v Yin Shuen Enterprises Ltd (2003) 6 HKCFAR 1 at §19. 68.The line that the Government acts in its private capacity in respect of matters concerning the governance of its own land – no matter in relation to the price and the terms offered for modifying leases, irrespective of whether the terms are “extraneous” or not (as in Rank Profit) or in rejecting proposals to develop land further for being inconsistent with a master layout plan set by the Government (as in Canadian Overseas Development Co Ltd v Attorney-General [1991] HKC 288) – is to be jealously guarded and not to be easily disturbed. This is because of policy concerns that are intrinsic and extrinsic to the law – intrinsic, because this relatively hard-edged rule promotes certainty within our system of law as to which decisions of Government are reviewable; extrinsic, because it ensures the Government is not “fettered” in its contracting powers and can use them to dictate (inter alia) the pace and quality of development. In Molinaro at §69, it was emphasised that sometimes the application of public law principles will cut across the private law relationship and, in those circumstances, the Court may hold that the public law complaint cannot be advanced because it would undermine the applicable private law principles. 69.Indeed, it is not right that a claimant suing a public body for breach of contract, who is dissatisfied with the remedy afforded him by private law, should be able to invoke public law simply because of his dissatisfaction, understandable though it may be. If he could do so, it would place a party who contracts with a public body in an unjustifiably more privileged position than a party who contracts with anyone else, and correspondingly put the public body in an unjustifiably less favourable position than any other contracting party. 70.In such circumstances – and subject to the question of bad faith or ulterior motive, to which I shall return below – JR2 is not (and, if necessary for consideration, JR1 is not) amenable to judicial review for a host of reasons:
71.Ms Eu submitted that the Government “should not be able to hide behind the public law element”. But I think that begs the question as to whether there is a sufficiency of public law elements to render the decision amenable. If not, there is no hiding behind it. 72.Mr Chan also referred me to a number of authorities which show that a private law action can be commenced against the Government for breach of the Implied Term under the BCL: see Dairy Farm Co Ltd v Secretary of Justice [2022] HKCA 1902 at §§1 and 24; Regal Shining Ltd v Secretary for Justice [2014] 5 HKLRD 832 at §§16-20, 24. There is no suggestion from Ms Eu that the Applicants could not have sued upon the Implied Term in a private law action (though I say nothing about the merits of any such claim). Thus, I accept Mr Chan’s submission that in these circumstances, allowing the Applicants’ judicial review would ‘cut across’ the contractual relationship which exists between the Applicants and the Government, or at least significantly make inroads into the Government’s contractual powers. It might unjustifiably improve the Applicants’ contractual position vis-à-vis public law. 73.All that aside, I have been urged by Ms Eu to consider that there are elements in the May Decision which render it amenable to judicial review: (1) the delay and the unusual handling of the Application – of the kind which is the ‘bread-and-butter’ of the LandsD – which she said was the result of the adverse publicity surrounding the Report, and (2) Ms Lam’s position as the previous Assistant Director of Lands. As such, it was said the May Decision was made “with a view to public opinion”. 74.However, I am not convinced that the authorities that I was taken to by Ms Eu demonstrate that a decision – even if made to avoid further public criticism – renders it subject to judicial review. 75.Hong Kong and China Gas Co Ltd v The Director of Lands [1997] HKLRD 1291 concerned the Government’s refusal to extend a special purpose lease beyond 1997. The special purpose lease was originally granted in 1963 for the storage and supply of liquid petroleum gas to inhabitants in Tsuen Wan, as the gas mains system – at the time – did not serve them. By 1975, however, the gas mains system was extended to Tsuen Wan – there was no longer any need for liquid petroleum gas. Since 1979, the land itself had been used as an emergency and maintenance depot for the applicant’s Customer Maintenance Department and Distribution Department for the Tsuen Wan and Kwai Chung areas, which consisted of car-parking spaces and storage of tools, equipment, fittings, spare parts and cylinders of nitrogen. As such, the Regrant Unit of the Lands Department in January 1996 – pursuant to a policy statement made by the Government in 1987 that special purpose leases in the New Territories would usually be extended unless inter alia it was “no longer being used for the purpose for which it was originally granted” – refused to extend it. Keith J held that the refusal to extend the lease clearly fell within the terms of the 1987 policy statement, and the Director of Lands had regard to a “host of competing interests” – including the interests of the community in having an emergency and maintenance gas depot, and the current site being unavailable to other potential lessees at a significant premium in the event of the lease being extended. 76.Wong Wai Hing Christopher v Director of Lands (HCAL 95/2010, 24 September 2010) concerned the villagers of Tsz Tin Tsuen in Tuen Mun Area 54. The applicants were previous owners of plots of land at Tsz Tin Tsuen, who held the relevant lots under a Block Crown Lease as agricultural land. However, structures had been built on the land for residential purposes. The Government tolerated those illegal structures for a long time. But in 2009, the Government decided to develop Tuen Mun Area 54 and so an order of resumption was made in April 2009. Handsome ex gratia payments were offered to the applicants, but they were considered by the applicants to be too low. Though the Government made offers for interim housing, the applicants considered this was not enough – indeed, they wanted to purchase another private property of “comparable character, size, and location in the market”. As such, the applicants refused to vacate. So the Director of Lands issued notices under section 6(1) of the Land (Miscellaneous Provisions) Ordinance Cap 28 (“LMPO”) to evict them. The applicants challenged the eviction. Lam J (as Lam PJ then was) held that the recovery of possession of land (as opposed to the decision to resume the land, which was not amenable) was amenable to judicial review for several reasons, including: (1) the Government was recovering possession unlike any “ordinary private landlord” – the Clearance Notice so issued was pursuant to the LMPO, in relation to Government land, (2) the Clearance Notice gave the Director a full-blown “remedy of self-help” – which in the private law context would be heavily restricted and of last resort, (3) the property so taken would become the Government’s property, and (4) there were criminal offences for persons who continued to occupy the land without reasonable excuse (§§48-59). 77.The impugned decision in Hong Kong and China Gas Co Ltd was considered to be sufficiently “public” in nature because (1) the Director of Lands was acting as the protector of the public interest by balancing competing considerations (see Anderson Asphalt (CFI) at §51), and (2) the decision was made pursuant a 1987 policy statement that applied to public utility companies. The impugned decision in Wong Wai Hing Christopher was subject to review because the Director of Lands would be entitled to some extraordinary powers and remedies that would not be conferred on an ordinary landlord if he decided to evict his tenant. It is easy to see why both Keith J and Lam J (as he then was) found there to be the requisite “public” element. Neither of them stands for the proposition that a decision by the Director to avoid further public criticism would make it amenable to judicial review. 78.R (Mullins) v Jockey Club Appeal Board (No. 1) [2005] EWHC 2197 concerned the Appeal Board’s decision to disqualify a racehorse after its urine sample was found to contain morphine, which breached Rule 53 of the Orders and Rules of Racing. It was not disputed the Rules of Racing were incorporated as part of the applicant’s contract with the Jockey Club. Stanley Burton J held (§§25-31) that the mere fact that inter alia the Rules of Racing include provisions which purport to apply to the world at large, or that its decision is important and has an impact on the livelihood of considerable number of people did not make the disqualification decision a “public” one. 79.Mauritius v CT Power Ltd [2019] UKPC 27 at §§43-45 did not rule on what a “sufficient public element” was or could be. Further, although I was not referred to it by either party, I also take into account Kam Lan Koon v Secretary for Justice [1999] 3 HKC 591 at 600B-G. There, the Court of Appeal held that a decision not to extend a special purpose lease was amenable to judicial review because the decision was taken pursuant to a policy statement. 80.I think the factors that Ms Eu relied on are actually best analysed as part of the Applicants’ “core allegation” in JR2 – namely, that the Director acted in bad faith or with an ulterior motive. E.3 Bad faith / Ulterior Motive 81.It is trite that decisions which are normally not amenable to judicial review may be if there is fraud, corruption, or bad faith: see Mercury Energy Ltd v Electricity Corp of New Zealand [1994] 1 WLR 521 at 529, where Lord Templeman – after rejecting the claim on the facts, finding that there was nothing to show that the defendant was acting irrationally or in bad faith or for improper or ulterior motives – said:
82.Similarly, in Lee Shing Yue Construction Co Ltd v Director of Architectural Services [2001] 1 HKLRD 715 at 730H-731C, it was said:
83.Ms Eu referred to R (Trafford) v Blackpool Borough Council [2014] PTSR 989, where in reaching conclusions in relation to amenability it was held, at §§54-55 and 59-60:
84.It is likely that the exception to non-reviewability exists because public bodies (even when exercising their private functions) are expected to act with minimum standards of reasonableness. Alternatively, this might be conceptualised as the sufficient “public element” that would be necessary to render a non-reviewable decision reviewable. 85.There is a rather sterile debate in the authorities as to whether an “abuse of power” – in the sense that an authority should not be permitted to act unfairly – is another reason to turn a non-reviewable decision into a reviewable one. However, I do not have to deal with this because I understand Ms Eu’s submission to have been that the “abuse of power” she refers to stems from LandsD’s “ulterior motive” or bad faith. 86.As to what is bad faith, I would draw on the following principles:
87.The heavy burden of proof also seems to me to be evident from the cases cited for the Applicants, where the Courts have considered making a finding of bad faith by a public body:
88.As such, the authorities cited by the Applicants do not really assist their case. None of them actually held the relevant public body to have acted on an improper motive / bad faith. As stated, rather they demonstrate the heavy burden of proof the Applicants bear in the present case. 89.I can turn to whether that burden has been met. E.4 Consideration on the Facts 90.To support the allegation of bad faith in respect of JR2, Ms Eu relies on matters that primarily concern JR1, and the chronology leading to it. Although I have ruled JR1 to be academic, I accept the background leading to JR1 may be relevant to the question of whether the May Decision and the Challenged Conditions were reached and imposed respectively in bad faith. The logic is that there might have been a pattern of conduct whereby the LandsD repeatedly acted with animosity towards the Applicants, and the imposition of the Challenged Conditions might have been part of and the latest episode in that pattern of conduct. 91.Ms Eu rightly accepted that there is a difference between (1) mere failure to adhere to standard practice, taking into account irrelevant considerations, negligence, ignorance or incompetence, and (2) abuse of power and bad faith. The focus in this challenge must be on the latter. 92.It is perhaps apt to start from motive. Put at or near its highest, Ms Eu suggested that the overall circumstances identified the only explanation was that the LandsD wanted to delay the Application as long as possible. The delay and the later imposition of the Challenged Conditions were, she submitted, clearly deliberate. Ms Eu pointed to (1) the involvement of many senior and experienced land officers who processed the Application, (2) the long catalogue of deviations from standard practice, (3) the gross delay, not least when compared to the target time of eight months for similar applications, and (4) inconsistent allegations put forward in the Director’s evidence. She submitted that the clear inference to be drawn is that there was an abuse of power and bad faith on the part of the LandsD to delay the approval until after Ms Lam’s retirement, by reason of the fear of political outcry and to penalise Ms Lam for causing trouble and inconvenience. 93.I do not think the underlying basis of the Applicants’ expressed concerns is inherently unlikely. The Report would have attracted some political or public outcry. If the news broke that the Applicants could build NTEHs, and thus could potentially reap the benefits of leasing the NTEHs for profit, then there might be public criticism that the Applicants had taken advantage of insider information as described in the Report, even though Ms Lam has been cleared of all wrongdoing. Any public outcry would be at least a distraction. Rightly or wrongly, the public might lose trust in the Government as a result. Any Government would wish to avoid that. Such public outcry could be avoided if ultimately the Applicants could never rebuild and thus lease the NTEHs on the purchased Land as a matter of practical reality – for example, by delaying the approval of the Application, or by imposing unrealistic and impossible Conditions. On the other hand, it is also fair to point out that the less any public outcry, the less plausible allegations of bad faith would be. 94.Anyway, I consider it not unlikely that the Director had public perception in mind when processing the Application. That is essentially admitted in the evidence, which accepts that that due to “media attention”, a Deputy Director/Specialist at senior directorate level was assigned to determine the Application – even though it was said to be for the sake of ensuring “procedures would be strictly followed” and “no mistakes would be committed”. I note that Mr Tang, in an affirmation made after JR1 and JR2 were ordered to be heard together, stated that he was “invited” to withdraw the Application so to “avoid any embarrassment”. I do not need to resolve this matter, and in any event I do not think this would change the outcome of the present case. I also note that the Applicants’ written submissions describe this as the “escalation of the approving authority”. I do not think whether this is an “escalation” or not resolves the question of whether the LandsD acted in bad faith. 95.As said, it is not difficult to think that the Director would have been cognizant of the political implications or public perception if the Application was seen to be approved, or approved too readily. But I also have to be satisfied that the steps taken after the Report was published – most importantly, steps of making requisitions and the imposition of the Challenged Conditions – were to further the alleged improper objectives. 96.As stated, Ms Eu relied on the significant delay in approving the Application. Obviously, the length and circumstances of the delay are capable of providing real ‘colour’ against which the bad faith allegations can be considered. Though I do not think that the evidence points only one-way, there is considerable force in the reliance on delay. 97.Various provisions of LID-31 – not least Appendix XIX – make clear that approval of similar applications do not normally take long. Section 3.1 states that the “way of processing the application by way of Approval Letter … should be determined at an early stage before the case is proceeded further”. Section 2.7 envisages that the applicant should be notified “within 5.5 months from the date of start processing”. It may also be significant that after the Application was processed, section 3.7 of the LID-31 was revised to provide that “Time frame for processing a case by way of Approval Letter should be within 8 months”. In that light, 8 years is a highly unusual amount of time for the Application to have been approved. 98.Even if this is a “non-straightforward case” as asserted by the Director, only 18 out of 214 NTEH rebuilding applications from 2016 to 2020 have taken 8 years or more. The Director draws a distinction between “straightforward” cases – which can be completed within 8 months as per Appendix XIX of LID-31, and “non-straightforward cases”. Straightforward cases are those that apparently have (i) the title in order, (ii) land lease with an unambiguous house entitlement, (iii) documents submitted by the applicant are in order (such as house proposal), (iv) no objection from government departments and the local villagers; (v) planning approval is not required, and (vi) the application site does not affect any public project. 99.This distinction is not found in LID-31. But the published performance pledge of 8 months for approval of straightforward rebuilding applications from the date of receipt describes non-straightforward cases as including those associated with land title or boundary problems or requirements imposed by other regulatory authorities, where the processing time will exceed the eight months depending on the nature and complexity of the problematic issues been encountered. 100.Even if it was only on 5 June 2017 that the Applicants submitted the 5th Housing Proposal (which finally did not attract any adverse comment) – which would have made the Application more straightforward – it still took the Application 3.5 years to be approved. In any event, there had been a gap of another 9 months between 20 May 2020 (when the YLDLOC had recommended the approval of the Application) and the eventual approval of the Application on 26 February 2021. The sole explanation for this delay was that the Director sought “legal advice” on various legal matters from the Department of Justice and the Land Registrar. There is room for some scepticism about what the purpose of such legal advice was, given the exhaustive Requisitions made by the LandsD and other government departments from 2014 to 2020. 101.I also note that the LandsD delayed in relaying certain comments by different government departments without good reason. For example, as to Requisition 9, even though the GEO had communicated that a GAR was necessary on 3 September 2019, the LandsD only requested a GAR from the Applicants on 25 October 2019, almost 2 months later. The LandsD also delayed in telling the Applicants that the 4th Housing Proposal was thought to be unacceptable by the SMO so to “wait” for the PlanD’s comments. Waiting for the PlanD’s comments was unnecessary – if the SMO found it objectionable, it was unlikely that the PlanD would have found it acceptable. Nor would the LandsD itself have (according to its conduct in this case) accepted any risk that the Application was objectionable in any way. Thus, the proper response would have been to inform the Applicants straight away, such that they could submit the 5th Housing Proposal as soon as possible. 102.I also accept that the LandsD did delay matters unnecessarily by allowing different departments to dictate the pace of the approval of the Application. That is objectionable in itself. In any event, Appendix VI of LID-31 – which is a standard “circulation memo” to other government departments which asks for comments on a NTEH rebuilding application – shows that the LandsD usually adopts a “cut-off point”: if the LandsD does not hear back in 4 weeks, the department whose opinion is sought will be deemed to have “no objection”. 103.I also consider the sudden approval of the Application a mere month after JR1 had been commenced to be a bit too convenient. 104.On the other hand, I accept that the LandsD had sent multiple chasers reminding other government departments for Requisitions 4, 5, and 8. This would militate against the accusation of bad faith. I also accept that the LandsD had set various deadlines for the relevant government departments to adhere to. 105.I accept the Director’s submission that part of the delay can be attributed to the Applicants’ delay in submitting the requested documents, most prominently, the 4th Housing Proposal. 106.I also accept that the LandsD never adopted what the Applicants refers to as the Missing Lease Approach at any point of the Application. In fact, in the RNTPC Paper, the LandsD clearly stated that the relevant rent roll records show that 0.04 acre of Lot 1504 and 0.02 acre of Lot 1505 were of “house” status. I also do not find support – either in Part B of LID-31 or otherwise – for the idea that the LandsD would “normally” allow NTEHs to be erected on any part of the Land if the documents permitting a change from “agricultural land” to “house” could not be found. So any delay there was not caused by an inexplicable volte-face. 107.Ms Eu contends that the Requisitions were all irrelevant, such that it caused unnecessary delay. The reason why the Requisitions are irrelevant is because they were not prescribed considerations under LID-31, as a matter of proper construction, and so (it is argued) the reason why these irrelevant Requisitions were raised was because the Director was motivated by bad faith. 108.I consider this submission to be fraught with difficulty, for various reasons:
109.Bearing those principles in mind, I now turn to Part A of LID-31 to examine whether – as Ms Eu suggests – that technical or other considerations should not have been taken into account. For the avoidance of doubt, I accept LID-31 §2.6 – at the time the Application was processed – did not refer to “geotechnical problems”.
110.I think it is also relevant to consider other appendices to the LID-31:
111.I think it is also necessary to take into account Section J-5 of the Lands Administration Office Instruction (“LIJ-5”), which governs the grant of CoEs under Cap 121.
112.In such circumstances, it is difficult to see how “technical and other considerations” can be said to be “irrelevant”.
113.I am thus not convinced that the LandsD took into account irrelevant considerations when raising its Requisitions. 114.What I really think Ms Eu was saying was that the Requisitions were arbitrary, as they were either uncommon, or had never asked before. Indeed, according to a letter dated 5 December 2019 from the LandsD, no previous applicant wishing to rebuild NTEHs had been required to submit an NTHS. Further, only about 80 previous applicants had been required to provide a proposed site formation level. Ms Eu also pointed to how the LandsD proactively asked the GEO as to whether a GAR was necessary on 3 September 2019. Plainly – she contended – the LandsD was conjuring matters out of thin air to further delay the approval of the Application. 115.I see the force in Ms Eu’s first point. But, I do not think I can read too much into it. Ultimately, it was the GEO which ultimately recommended the need for a NTHS. It was for an irrefutable reason, namely that the small house was at the “toe of a steep natural terrain overlooking the captioned lot”. I do not think Ms Eu’s second point has the same force. Ultimately, if the LandsD was entitled to have regard to geotechnical and site formation concerns – as I have found – then it was also entitled to ask or confirm from the GEO that a GAR might be necessary. 116.That said, I do think it is rather strange that the LandsD retracted Requisition 8 after the Applicants flatly refused to entertain it. Nevertheless, I do not think I can infer bad faith from this factor alone. 117.I turn now to the Challenged Conditions. Ms Eu contended the Challenged Conditions demonstrate bad faith in two ways: (1) Conditions 2, 3, 13 to 22, and 24 to 25 are not found in the Standard Letter, and thus there was a failure to adhere to “standard practice”, (2) most of them were imposed without good reason whatsoever, or they take into account “irrelevant considerations”. 118.I do not consider the first point to be a good one. I accept Mr Chan’s submission that LID-31 and the Standard Letter provide internal guidelines and templates for adaptation where appropriate. That is why the Standard Letter says that an officer can “delete as appropriate” certain conditions. Thus one cannot infer a standard “practice” by the Director. I certainly cannot infer bad faith from a failure to follow a template. 119.In any event, I accept there are at least rational reasons for the Challenged Conditions to have been imposed.
120.I have considerable sympathy for the Applicants. It is easy to see why the Applicants might reach the subjective conclusion that the Application was treated differently by the LandsD because of the political outcry following the Report and/or the way in which Ms Lam defended herself during the external and internal investigations which cleared her name. 121.Indeed, it may not be unfair to think that the entire Application has been handled in a poor manner – in particular, through the delay in approving the Application, which must have been deeply frustrating for the Applicants. I also understand Mr Tang’s instinct to complain to the Ombudsman about possible maladministration. 122.On the other hand, Ms Lam was herself fair enough in her evidence to express understanding that the Government had to be careful not to give any impression that she might receive favourable treatment because of her posting with the LandsD – though she also emphasised that she should not be subject to prejudicial treatment either. I agree with her, on both limbs. I think the need to take appropriate care so as at least to lessen the scope for criticism of favourable treatment explains some of the delay. It is also not hard to think that there may have been some element of reluctance among some individual officers to reach a decision which might attract more public comment, possibly public criticisms. That may perhaps have led to greater requisitions and perhaps to some of the conditions attached to the approval. But I do not think that translates into a deliberate decision not to make a decision at all, or to delay pending some long future date (whether tied to Ms Lam’s retirement or otherwise), or to penalise Ms Lam for the publicity previously generated. 123.Indeed, there is also an inherent unlikelihood in the underlying assumption that would be necessary for the bad faith or ulterior motive to be set out. That is because any such motive as is to be attributed to the LandsD would actually require having been shared across a fair number of people (even within the LandsD, and even ignoring the involvement of other government bureaux or departments). To be established, the allegation in effect would require the bad faith or ulterior motive to have been shared, intentionally, and over a not insignificant period of time, by a number of people – including the “many senior and experienced land officers” to which the Applicants themselves make reference as having been involved in the various dealings with the Application. Quite simply, the more people involved and the longer the period over which activities took place, the less likely it is that they would have acted in bad faith and in concert with the necessary degree of homogeneity. Those matters seem to me to point against a deliberate and ill-motivated departure from normal dealings (even if it might be thought that there was some level of hesitation, incompetence or negligence on view). They also point against a deliberate and ill-motivated common intention to penalise Ms Lam. 124.In conclusion after considering matters overall on balance – even when considering matters cumulatively and in the round, and not on a single point-by-point basis – I do not think the case of “bad faith / ulterior motive” on the part of the Director in imposing the Challenged Conditions has been made out. 125.I thus hold that the May Decision is not amenable to judicial review. Had I not found JR1 to be academic, I would have found that the challenge in that was also not amenable to judicial review for similar reasons. F. Remaining Analysis on the Grounds 126.Since I have found that the May Decision is not amenable to judicial review, I propose to deal with the substantive merits more economically, particularly when there is substantial overlap between my analysis on amenability and the substantive merits. Further, once the element of bad faith motive is removed, that necessarily weakens the individual grounds, which are significantly tied to that motivation. 127.Broadly, I accept the submission made by Mr Chan that if there is no sustainable case on abuse or bad faith or ulterior motive on the facts, then the core of the substantive case collapses. Without acceptance of the “core allegation” of bad faith or ulterior motive, there is little left in the piecemeal complaints:
G. Result 128.Albeit not without some hesitation, I dismiss the Applicants’ applications for judicial review. 129.I currently see no reason why costs should not follow the event, so that the Applicants pay the Director’s costs with certificate for two Counsel. I will make this order on a nisi basis, which will become absolute after 14 days unless a prior application is made to vary this order. Any variation decision will be made on paper.
Ms Audrey Eu SC and Mr Andrew Tse, instructed by CL Chow & Macksion Chan, for the applicants in both cases Mr Abraham Chan SC and Mr Lam Chin Ching Gary, instructed by the Department of Justice, for the respondent in both cases | ||||||||||||||||||||||||||||||||||||||
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