Lai Chi Kok Amusement Park Co, Ltd v. Chat Yat Chiu and Others

DCMP 2446/2022 & DCMP 2448/2022

(Consolidated)

[2026] HKDC 1084

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NOS 2446 & 2448 OF 2022

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BETWEEN

(BY ORIGINAL CLAIM)

AND BETWEEN

(BY COUNTERCLAIM OF THE 1ST DEFENDANT IN THE ORIGINAL ACTION)

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JUDGMENT

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A. FACTUAL AND PROCEDURAL BACKGROUND

1.This is an adverse possession case concerning two areas within Lot No 1249 in Survey District No 4 (“the Lot”) in a region described as Kau Wa Keng (九華徑). Despite the parties’ repeated references to Kau Wa Keng Pumping Station Upper Village (九華徑泵房上村) (“the Village”), no material shows how its boundaries are defined or its precise relationship with the Lot.

2.The following factual and procedural background is not in dispute.

3.The record from the Land Registry shows that in 1906, Tsang Chan Kwan transferred the Lot to Tsang Tai Ip, who was the great-grandfather (太公) of Mr Tsang Hing Leung (曾慶良) (“Mr Tsang”). Mr Tsang is now 88 years old and a witness in this case.

4.In 1979, Cornhill Enterprises Limited became a 50% co-owner of the Lot. In September 2022, it transferred its share to Lai Chi Kok Amusement Park Company, Limited, which was subsequently substituted as the Plaintiff (by Original Action) (“P”).

5.From about 1951 to September 2015, Mr Tsang was a one-sixth co-owner of the Lot. In 2015, he sold his share to Ultra Sky Limited, which also acquired a one-sixth share each from two other members of the Tsang family in 2015 and 2017, thereby becoming the other 50% co-owner of the Lot.

6.On 11 July 2022, Cornhill Enterprises Limited, as a 50% co-owner of the Lot, commenced DCMP 2446/2022 and DCMP 2448/2022 to seek possession against the unnamed occupier(s) of two areas, respectively described as “Area-1” and “Area-3” and identified in the two plans attached to the originating summonses.

7.By order dated 19 October 2022, Mr Chan Yat Chiu (陳逸超) (then acting in person) was joined in both actions as the 1^st Defendant (by Original Action) (“D1”).

8.On 6 March 2023, the actions were consolidated. On 18 July 2023, D1 filed a Consolidated Defence and Counterclaim (“D&C”), claiming that:

8.1 He has been in adverse possession of a piece of land known as “No. 6F, Kau Wa Keng Pumping Station Upper Village, Hong Kong” [1] which “comprises part of Area-1 and the whole of Area-3” [2] marked with green boundaries as per the plan in Annex 1 (“the Disputed Area”).

8.2 A triangular part of Area-1 outside the green boundaries (“the Triangular Part”) “is separated [from] [the Disputed Area] by a wall and is occupied by a Mr Choy”[3].

9.On 14 August 2023, P filed a Consolidated Reply and Defence to Counterclaim (“R&DC”), claiming that:-

9.1 Mr Tsang had rented the Lot to a Mr Leung Geu (梁照) (“Mr Leung”) from the 1980s to 2015[4].

9.2 D1 had not been in adverse possession of the Disputed Area[5].

10.In respect of the Triangular Part, Mr Choi Hon Yau (蔡漢有) (“D2”) was joined as the 2^nd Defendant (by Original Action) on 16 October 2024. By Final and Interlocutory Judgment dated 4 August 2025, D2 was ordered to deliver vacant possession of the Triangular Part.

11.The parties helpfully agreed that the relevant areas mentioned in the pleadings and witness statements are identified by the following descriptions in a plan attached as Appendix 1 (“the Plan”):

Abbreviations	Description	Reference
Disputed Area or 6F(D1)	Whole area within green boundaries	Area counterclaimed by D1 for adverse possession
Area-1	Red area	Area claimed by P for possession
Area-3	White area within green boundaries
Triangular Part	Red area outside green boundaries	Judgment against D2

12.By order dated 12 August 2024, Ultra Sky Limited was joined as the 2^nd Defendant (by Counterclaim), being the other 50% co-owner of the Lot. This co-owner, together with the 3^rd and 4^th Defendants (by Original Action) (“D3” and “D4”), did not participate in these proceedings. This trial proceeded in their absence.

13.Since it is common ground that P is a 50% co-owner of Area-1 and Area-3, this trial in substance only concerns D1’s counterclaim for adverse possession of the Disputed Area, which calls for the determination of two central questions:

13.1 Whether the rental arrangement between Mr Tsang and Mr Leung existed, and if so, what the legal consequence is; and

13.2 Whether D1 had been in adverse possession of the Disputed Area for over the limitation period (agreed to be 12 years) before P commenced proceedings in 2022.

B. THE PLEADED CASES OF P AND D1

B.1 D1’s D&C

14.D1 lived in “No 2” (the location of which was not identified) of the Village from 1994 until about 11 March 2008[6].

15.In about 1996 or 1997, D1 “was acquainted with 蘇祖元 (“Mr So”) who was the exclusive occupier of [the Disputed Area] and who had not been paying any rent or licence fee to anyone for his exclusive occupation”[7]. “[the Disputed Area] was already fully enclosed since at least 1996 or 1997”[8]. It is common ground that the name of Mr So was intended by D1 to refer to Mr So Joe Yuen (蘇祖願), who passed away on 25 December 2016 at the age of 82.

16.On about 11 March 2008, D1 moved to live in “No 1” (the location of which was not identified) of the Village[9].

17.In around autumn 2009, Mr So told D1 that: (1) D1 “could take [the Disputed Area] from him for free because (i) he would move out of [there] soon as he had been offered a public housing tenancy and (ii) [the Disputed Area] was in a dilapidated condition and the upkeep would be costly for him”; and (2) he “had never paid any rent or licence fees to anyone for occupying [the Disputed Area], and [D1] also did not need to do so”[10].

18.D1 then took exclusive possession of the Disputed Area as a successor to Mr So and treated it as his home. He became the only person who had the keys to the three doors shown in the Plan, which were the only access points to the Disputed Area, and he carried out renovation works to improve its condition[11]. Since about autumn 2009, D1 has been “the sole occupier” of the Disputed Area[12].

19.D1 therefore acquired a possessory title over the Disputed Area either: (1) from Mr So; or alternatively, (2) by his “successive, continuous and exclusive control and possession of the Disputed Area” since around autumn 2009.

B.2 P’s R&DC

20.In respect of the Lot, from about the 1980s until 2016:

20.1 Mr Leung would pay a “yearly land rental (or licence fee)” of about HK$1,000 to HK$1,200 to Mr Tsang, who received it in around March each year as one of the co-owners of the Lot until September 2015, and thereafter as an agent for the new co-owner, Ultra Sky Limited[13]. Nevertheless, if this arrangement existed until 2015, the pleaded agency for Ultra Sky Limited thereafter would not affect the outcome because the present actions were commenced in 2022.

20.2 He was “aware of the sub-leasing or sub-licensing activities by [Mr Leung] (and before [Mr Leung] it was a family with surname Chow who took care of the sub-leasing activity) and he was aware [that] there were other occupants living on the Lot. [Mr Tsang] permitted such sub-leasing or sub-licensing activities as long as [Mr Leung] was able to pay him the yearly land rental (or licence fee) on time.”[14]

20.3 The “land rental” paid by those occupants to Leung “would form parts of the land rental (or licence fee) payable to [Mr Tsang] by [Mr Leung]”[15]. At trial, P confirmed that there is no pleaded case on any rental arrangement directly between Mr Tsang and other occupiers of the Lot, and this plea is intended to support P’s case that D1 could not have been in adverse possession.

21.In respect of Area-1:

21.1 From 1989 to 2006, Mr Chan Kwun Kit (陳冠杰, also known as 榮叔) (“Mr Chan”) paid yearly land rental of HK$400 to Mr Leung for his occupation of Area-1[16].

21.2 From 2006 until late 2013, D1 “was permitted by Mr Chan Kwun Kit to stay and use Area-1” and D1 had paid HK$400 per month to [Chan] “for the occupation and usage of Area-1 as a sub-licensee or a sub-lessee”[17], and this “would form parts of the yearly land rental (or licence fee) paid by [Leung] to [Mr Tsang].”[18]

22.In respect of “part of Area-3 (which is adjacent to Area-1 and marked with black lines”[19] (“Area-3 (striped)”) in a plan[20] attached to this Judgment as Appendix 2 (“R&DC Plan”), P avers the following[21]:

22.1 Mr So and his wife Ms Lam Mo Ching (林務貞) (“Mrs So”) bought a makeshift structure on Area-3 (striped) from “Ah Ping” for the use of their son and his family from late 1999 to 2003. In about 2003, Mr So sold this structure to the son of Mr Leung’s brother for HK$20,000.

22.2 At that time, the couple was living in a makeshift structure nearby, ie within the blue boundaries on the R&DC Plan.

22.3 In about 2004, the other part of Area-3 was used by one “Shanghai Uncle” (上海佬).

22.4 After 2004, Area-3 was used by Mr Leung’s brother and/or other family members of Mr Leung until 2016.

22.5 “Area-3 has not been used, occupied or possessed exclusively” by D1 at all material times.

22.6 Mr So “was also a sub-licensee or sub-lessee of the Lot and had paid rental to Mr Leung Geu every year when he lived on the Lot”.

22.7 Mr So “had neither lived in 6F (Area-1) [ie the red area within the green boundaries in the Plan] nor gifted the 6F to [D1] or any third party”.

C. THE CORE ISSUES OF FACT

23.On the basis of the pleadings, there are four core issues of fact:

23.1 Issue 1: whether Mr Tsang (for the co-owners of the Lot) rented the Lot to Mr Leung on a yearly basis from the 1980s to 2015, when he ceased to be a co-owner.

23.2 Issue 2: whether Mr So paid rent to Mr Leung for his occupation of the Lot since 1996.

23.3 Issue 3: whether Mr So gifted the Disputed Area to D1 in 2009.

23.4 Issue 4: whether D1 occupied the Disputed Area with Mr Chan’s permission.

D. EVIDENCE RELATING TO ISSUE 1

D.1 P’s evidence relating to Issue 1

24.On Issue 1, P relies on the direct evidence from Mr Tsang, as well as principally indirect evidence from (1) Mrs So; (2) Mr Chan; (3) Mr Fung Mun Yee (馮敏兒) (“Mr Fung”); and (4) Ms Daisy Chan (“Ms Chan”), P’s officer. Their evidence must be viewed in the light of how the three villagers claimed to have resided in the Village during different periods, as clarified in the course of the trial:

Name	House	Location	Period
Mrs So (林務貞)	2A	Green area on R&DC Plan	1995 to 1996
	2A	Blue area on R&DC Plan (outside the Disputed Area)	1996 to 2004
Mr Chan (陳冠杰)	House 6F(CKK)	Red area within green boundaries in the Plan	1989 to 2006
Mr Fung (馮敏兒)	6G	Adjacent to the Triangular Part in the Plan	2009 to 2024

25.Mr Tsang said in chief[22]:

25.1 During the time when he was a co-owner of the Lot, he “rented” (出租) the land to others as their residences on a periodic basis with rents payable in March each year. The occupiers of the Lot were successively a Lee family, a Shum family, the family of周國成 and Mr Leung.

25.2 Around the end of the 1970s, he discovered that 周國成 “sub-rented” (分租) the Lot to others. He did not object to this as long as he received the yearly rent. At the end of the 1980s, 周國成 moved to Yuen Long and he had not seen him or his family since. He knew that Mr Leung then took care of the sub-renting arrangement on the Lot, which he did not object to as long as he received the yearly rent on time.

25.3 Since the early 1980s, Mr Leung had rented the Lot on a yearly basis until Mr Tsang sold his shares in the Lot in 2015. Mr Tsang went to the Lot in March every year to receive the yearly rent from Mr Leung until about 2016. By then, he had sold his shares, but he received the rent for and on behalf of Ultra Sky Limited.

25.4 He produced three rental slips issued by himself to evidence the rental arrangement[23]:

(1) one dated 3 March 2011 in the sum of HK$1,000 in favour of “Leung” (which meant Mr Leung) for the period between 3 March 2010 and 3 March 2011;

(2) one dated 3 March 2011 for “Tang” (“Mr Tang”) in the sum of HK$1,200 for the period between 3 March 2011 and 3 March 2012; and

(3) one dated 3 March 2012 for “Tang” in the sum of HK$1,200 for the period between 3 March 2012 and 3 March 2013.

25.5 He explained that Mr Tang sub-rented the Lot from Mr Leung and requested Mr Tsang to issue a rental slip in his name for his application for public housing. He did so with Mr Leung’s consent.

26.Under cross-examination, Mr Tsang said:

26.1 He has been living in Kau Wa Keng Old Village (九華徑舊村) since his birth in 1938. His elder brother Tsang Hing Nam was a seafarer, and another brother Tsang Hing Tong did not care much about these matters. Therefore, Mr Tsang was responsible for taking care of the rental arrangement with Mr Leung over the years. The collected rent would be given to their mother as general expenses for the family.

26.2 In respect of the rental arrangement between Mr Leung and him regarding the Lot, Mr Tsang accepted that there was no written “rental agreement” (租約). However, he said he would issue a rental receipt (租單 or 租單存據) to Mr Leung whenever rent was paid, and he kept a small stub. He said the rental receipts[24] produced in the bundle were signed and issued by him in respect of this arrangement. He had bought a pile of those rental receipts with the clauses imprinted thereon from a stationery shop, and he still kept some of them.

26.3 Mr Tsang accepted that he did not know whether Mr Leung actually sub-rented the Lot to other people. He only learned this from Mr Leung, who said that rents would be collected from others, and then paid to him after receiving the sufficient amount (佢話同人收租, 收夠就俾我[25]).

27.Mrs So married Mr So in 1975, and moved from Mainland to live with him in No 2A of the Village on the Lot in 1995. They lived first in the green area shown on the R&DC Plan, and then from 1996 to 2004, in the blue area on the same plan. No 2A actually comprised a number of structures, including the green area, blue area and Area-3 (striped) shown on the R&DC Plan. Her evidence in chief on Issue 1 comprised a simple hearsay statement (without identification of its source) that Mr Leung would pay rent received from occupiers of the Lot to the landlord(s) of the Lot (轉交業主)[26]. Under cross-examination, she said Mr So told her that he had paid rent in cash (out of his income) to Mr Leung, who then paid it to the “landlord(s) of the Lot” (the identity of whom she did not know), but she had forgotten when Mr So told her this. She also learned from Mr So that Mr Leung would remind the occupiers of the Lot to pay rent near the due date.

28.Mr Chan took over (頂讓) in 1989 from D2 a structure built on Area-1 called No 6F at a cost of HK$17,000, and lived there until 2006[27] - House 6F(CKK) shown as the red area within the green boundaries in the Plan. He produced the purchase agreement (頂讓合同) bearing a completion date of 12 August 1989[28]. From 1989 to about 2006, he paid a HK$400 yearly rent to Mr Tsang, and the method of payment was that Mr Leung would receive it on Mr Tsang’s behalf. He witnessed Mr Tsang and Mr Leung coming to the Lot to receive rent[29]. Under cross-examination, he said he paid rent to “Elder Leung” (梁伯), whose name he gathered from others to be Leung Geu (梁照), without receiving any receipt.

29.Mr Fung took over (頂手) in 2009 from one Cheung Sum Man (張心文), whom he knew through D1, a structure known as No 6G and at a cost of HK$70,000. He started living there in 2009. Similar to Mr Chan, he paid a HK$400 yearly rent to Mr Leung (until 2016), and he understood that everyone living on the Lot had to pay a HK$400 yearly rent to Mr Leung around March to April every year, which would then be passed on (轉交) to Mr Tsang[30]. Under cross-examination, he clarified that No 6G meant only the yellow area shown in the plan annexed to a user agreement dated 21 January 2022 between P and himself - the rectangular area adjacent to the Triangular Part in the Plan[31].

30.Ms Chan (P’s officer) testified to having learned of the rental arrangement from Mr Tsang in 2021[32]. Under cross-examination, she clarified that she first met Mr Tsang near his residence and confirmed that he was a co-owner of the Lot by conducting a land search. She later visited Mr Leung, who told her that he had paid rent to “Big Mole” (大粒墨) for a few decades (幾十年), and Mr Tsang subsequently acknowledged that he was the said “Big Mole”[33].

D.2 D1’s evidence relating to Issue 1

31.D1 called three witnesses who claimed to have resided in the Village as follows:

Name	Residence	Period
D1	The Disputed Area	2009 to now
Chow Kwok Shing (周國成) (“Mr Chow”)	2A	All along (一直)
Wong Keung Bun (王強彬) (“Mr Wong”)	2B (“diagonally opposite” to the Lot)	1993 to 2023

32.In chief, D1 said he did not know Mr Tsang and had never seen him or any person claiming to be him (or his representative)[34]. In his oral testimony, D1 confirmed that he had no idea who the landlords (業主) of the Lot were.

33.Mr Chow and Mr Wong gave evidence that they did not know, had never contacted Mr Tsang, and had never paid rent to Mr Tsang or any of his alleged representatives[35].

E. EVIDENCE RELATING TO ISSUES 2 to 4

E.1 P’s Evidence relating to Issues 2 to 4

34.On Issue 2 (the rental arrangement between Mr Leung and Mr So in 1996), Mr Tsang, Mrs So and Ms Chan could only give indirect evidence:

34.1 Mr Tsang did not know whether Mr Leung had actually rented the Lot to other occupiers and, even if so, what their identities were.

34.2 Mrs So could attest only to what she had been told by Mr So - that rent was paid to Mr Leung in respect of their occupation of the Lot[36].

34.3 Ms Chan merely repeated what she was told by Mr Tsang, Mr Leung, Mr Chan and Mr Fung.

35.In contrast, Mr Chan and Mr Fung gave direct evidence on Issue 2 that they paid rent to Mr Leung over the years:

35.1 Mr Fung said in chief that, from 2009 to 2016, both he and D1 paid rent to Mr Leung, who passed it on to Mr Tsang[37]. D1 had lived in “6F” since 2009[38]. Under cross-examination, he said that, on one or two occasions, he witnessed Mr Leung arrive at the Lot to request everyone to pay rent, and once or twice (一次半次), he saw that D1 was standing next to Mr Leung when his request was made.

35.2 Mr Chan said that, from 1989 to 2006, he and other occupiers of the Lot paid rent to Mr Leung, and he saw Mr Tsang and Mr Leung come to the Lot to receive rent[39].

36.On Issue 3, Mrs So gave direct evidence that Mr So did not gift the Disputed Area to D1 in 2009.

36.1 She denied that Mr So had ever gifted any structures on the Lot to anyone, and stated that Mr So had never lived in the Disputed Area as alleged by D1. From 1996 to 2004, Mr So and she rented from one Mrs Wong (葉麗珍) the structure in the blue area on the R&DC, which was next to, but outside, the Disputed Area. Mrs So produced copies of the relevant rent receipts for certain periods from March 1996 to December 1996 and July 1999 to December 1999[40]. Mr Leung once told her that D1 had rented the residence of Mr Chan[41].

36.2 Around early 2000, she bought another structure in No 2A from Ah Ping (阿平) at HK$16,000 for her son and his family, who lived there until about 2003, ie Area-3 (striped) on the R&DC Plan.

36.3 From the end of 1995 to 2004, Mr Chan lived in House 6F(CKK)[42]. When cross-examined, she supplemented that only this house was named “6F” in the Village. This is consistent with Mr Chan’s own evidence as explained below.

36.4 Under cross-examination, Mr Fung stated that D1 had never mentioned being gifted the Disputed Area, despite their acquaintance for more than 10 years.

37.On Issue 4, Mr Chan gave direct evidence that D1 occupied House 6F(CKK) (ie part of the Disputed Area) with his permission.

37.1 As explained, in 1989, Mr Chan took over House 6F(CKK) located in Area-1 from D2, and he lived there until 2006. Under cross-examination, he said only his structure was called “6F” and other blocks were called “2A” (單獨6F, 果度全部幾間2A)[43], which was in Area-1, i.e. House 6F(CKK) did not constitute the whole of the Disputed Area, which additionally included Area-3. A letter issued by CLP Power Hong Kong Limited acknowledged that he was the registered user of an electricity account in respect of “Hse 6F” in the Village from 24 June 1991 to 26 June 2006[44]. On 27 June 2006, he applied to change the registered user to his elder paternal cousin[45]. He moved to a public housing estate in 2006 as shown in a tenancy agreement dated 6 April 2006[46].

37.2 Mr Chan had known D1 for about 30 years, since D1 lived with his mother in No 2 of the Village opposite the Lot. In 2006, he rented House 6F(CKK) to D1 for a monthly rent of HK$400. D1 paid rent until 2013. At the end of 2013, however, D1 failed to pay rent for more than two months despite his telephone reminder. As a result, he stopped permitting his use in April 2014, and on 3 May 2014, he tried to enter House 6F(CKK) by picking its lock (撬鎖) since D1 had failed to pay rent and did not answer his calls[47].

37.3 Mr Fung gave indirect evidence that Mr Chan had rented House 6F(CKK) to D1[48]. In his oral testimony, he clarified that he met Mr Chan for the first time in 2014 when the latter tried to enter House 6F(CKK) by picking its lock. To rectify what he suggested in his witness statement[49], he clarified that he only knew after the aforesaid incident that D1 had failed to pay rent to Mr Chan.

E.2 D1’s evidence relating to Issues 2 to 4

38.D1 gave evidence in chief on Issues 2 to 4 as follows:

38.1 D1 lived in “6F”, which comprised the “whole of Area-1 and part of Area-3”, ie within the green boundaries in the Plan[50]. In his oral evidence, he clarified that the version in the D&C was correct, namely that “6F […] comprises part of Area-1 and the whole of Area-3”[51].

38.2 Upon D1’s inquiry in autumn 2009, Mr So told D1 four matters[52]:

(1) He had already moved to a public housing unit and would no longer live in 6F (see Issue 3).

(2) 6F was a derelict house (爛屋) so “if you like, fix it and take it for your living” (“你鍾意咪整番自己攞黎住”) (see Issue 3).

(3) He had been occupying his residence in the Disputed Area on the Lot without paying rent since at least 1996 or 1997 (see Issue 2).

(4) As 6F was his “own property”, D1 as his “successor” need not pay any rent (“6F號是他自己的財產, 因此[D1]作為…繼承人…不需…付租金”) (see Issue 4).

38.3 Regarding Issue 4, D1 occupied the Disputed Area without paying any rent since autumn 2009. He occasionally gave HK$400 to Mr Chan until 2014 not as rent but as “protection money” upon extortion by the latter[53], who was described as a village bully (村霸). He did give money to Mr Leung not as rent for his use of the Disputed Area, but merely as a token of respect as a neighbour and junior for Mr Leung to buy food (作為鄰居及後輩才孝敬他給他少許金錢 ‘買嘢食’”) [54] (see Issue 4). He supplemented that he had never discussed the rental arrangement of Area-1 with Mr Chan (從未與陳冠杰傾談有關Area-1租賃事宜)[55].

39.Mr Wong gave indirect evidence, while Mr Chow was largely silent, on Issues 2 and 3.

39.1 On Issue 2, Mr Wong gave no direct evidence. He had lived in No. 2B in the Village (the location of which was not identified) [56] since 1993 for about 30 years. He referred to “Annex 1” as his documentary proof but Miss Ho confirmed that no such evidence has ever been adduced. He knew that Mr So had been living in “6F” (the location of which was not identified) since the end of the 1990s. Mr Wong was silent as to whether Mr So paid any rent for his residence.

39.2 On Issue 3, Mr Wong’s evidence in chief comprised two parts. First, around autumn 2009, Mr Wong learned that Mr So transferred his “occupation right” of “6F” (the location of which was not identified) to D1; Mr So then moved out of 6F, and D1 began living there. (我得知 [Mr So] 將6F號的佔用權轉移給[D1], [Mr So] 便搬出了6F, 而 [D1] 開始居住在 [6F]”[57]). Later, Mr Wong clarified the last sentence meant that, as D1 moved into 6F, Mr So no longer used 6F (“既然[D1] 入住了6F, [Mr So] 便不再使用6F了”[58]). This suggests that Mr So transferred his occupation right to D1 before moving out of the house.

40.On Issue 4, Mr Wong and Mr Chow said in chief that D1 had all along controlled and occupied 6F (the location of which was not identified) without any interference[59].

F. ASSESSMENT OF THE EVIDENCE GENERAL OBSERVATIONS

41.In this case, the evidence is assessed, and the following findings of fact are made, in accordance with the principles summarised in Charm Master Enterprises Ltd v Grand T G Gold Holdings Ltd [2024] HKCFI 2847 §§60-62, Cheng J. Although the evidence is set out separately under Issues 1 to 4 for the sake of convenience, it has been assessed holistically.

42.Three topics were touched upon in the parties’ submissions: (1) the authenticity of certain documents; (2) adverse inferences; and (3) plagiarism of witness statements by D1’s witnesses. As accepted by the parties, these matters do not absolve the Court of its duty to assess all the evidence in accordance with the above approach. None of them independently affects the analysis and conclusions explained below.

43.First, although submissions were made on various documents, Miss Ho rightly confirmed that the authenticity of the documents in this case is not challenged. In the absence of any notice to challenge authenticity served under Order 27, rule 4(2), D1 “cannot” do so: Silver Stone Development Ltd v Lau Kwong Ching James [2006] 4 HKC 100 §15, DHCJ Carlson.

44.Second, both parties touch upon the issue of adverse inferences due to the absence of some possible witnesses. The core principles are summarised in Charm Master Enterprises Ltd v Grand T G Gold Holdings Ltd [2024] HKCFI 2847 §§64-66, two of which merit particular emphasis:

44.1 It is for a party advancing such an argument to identify the particular inference which the court is invited to draw, and to explain why such inference is justified on the basis of other evidence (§65).

44.2 The Court should be free to draw, or decline to draw, inferences from facts using its common sense and ordinary rationality. Whether any positive significance should be attached to the absence of certain evidence or witnesses depends entirely on the context and particular circumstances (§66): citing Efobi v Royal Mail Group Ltd [2021] 1 WLR 3863 §41, applied in ANZ Commodity Trading Pty Ltd v Excellence Raise Overseas Ltd [2025] HKCA 701 §121, Kwan VP (with whom Barma JA and Harris J agreed).

45.In this case, the issue of adverse inference does not arise. Neither party identified what adverse inferences are to be drawn or the factual basis for drawing them. Moreover, this is not a case where there could be no rational justification for the absence of the possible witnesses.

46.Third, on plagiarism of witness statements, the following observations are relevant:

46.1 “[T]he purpose of a witness statement is for the witness to ‘tell their story’ to the court. The pre-prepared, pre-filed, witness statement is a substitute for the evidence in chief of a witness. The only proper way in which such a witness statement can be taken is for a solicitor to sit with the witness and question the witness, in the same way as evidence would have been elicited in the past in chief. From the answers to the questions the narrative, or ‘the story’, is built up in the form of a witness statement.”: Ho Sing Yin v Chan Yiu Ling HCA 90/2010 (unreported, 13 July 2012) §59, DHCJ Saunders (appeal allowed on other grounds); applied in Au Yeung Pui Chun v Cheng Wing Sang [2021] HKCFI 463 §§31-32, G Lam J (as he then was).

46.2 “The fact that our system now requires full disclosure of a party’s case, in part by the exchange of witness statements prior to the trial, is not a license to solicitors to tailor or engineer witness statements in order that they may corroborate each other. […] [I]t is not for a solicitor to choose the words, phrases, or expressions in a witness statement. Those are all matters for the witness. Where witness statements are identical it is difficult if not impossible to believe that the witnesses have independently provided the raw materials for the preparation of the witness statement”: Ho Sing Yin v Chan Yiu Ling HCA 90/2010 §§61 and 64.

46.3 Yet, the proposition that the Court will often be unlikely to place any weight on substantially identical witness statements should not be taken as “an over-sweeping statement of law”: Chan Chung Yee v Chan Wah Cho, Joe [2018] HKCFI 611 §37, DHCJ To, explaining Ho Sing Yin v Chan Yiu Ling HCA 90/2010 §§58 and 61.

46.4 “[I]f it is the clear product of copy and paste, there is a need for caution. On the other hand, the court may not know which of the two is the original work and which is the copy product. The court’s function is not to penalize. It would be abdicating its fact finding function by giving both statements no weight and would not be doing justice to the party or witnesses concerned. […] [I]f a witness’s evidence has been tested by cross-examination, the court should do its best to assess credibility.”: Chan Chung Yee v Chan Wah Cho, Joe [2018] HKCFI 611 §37. The court should not dismiss “the problematic witness statements automatically” or simply reject such evidence: Shum Wing Lok v Shum Man [2022] HKCFI 2622 §§65 and 68, DHCJ H Au-Yeung (as he then was).

46.5 Nearly identical statements may suggest that “the witnesses have either conferred together about what they would include in their evidence, or they just follow what one another said to be the factual situation, or they simply signed whatever that was presented for them to sign, and that the drafter had prepared the statements out of a common template” so that the Court may give little weight to them: Pang Ping Kong v Pang Kam Lun [2025] HKCFI 1464 §§79-81, H Au-Yeung J; see also Au Yeung Pui Chun v Cheng Wing Sang [2021] HKCFI 463 §35, G Lam J. A relevant consideration is whether the duplication appears on “non-controversial or background matters”: Caidao Capital Ltd v Overdijk [2026] HKCFI 1326 §55, DHCJ Jin Pao SC.

46.6 “Expungement of such identical parts in their entirety may appear to be extreme but it may be an effective sanction in appropriate cases”: Integrity Financial Advice Network Company Limited v Chu Yau Shun HCA 623/2012 (unreported, 15 March 2016) §37, DHCJ Kent Yee.

47.The Court should approach the witness statements of D1, Mr Chow, and Mr Wong with particular caution. Their statements are strikingly identical on critical aspects relating to Issues 1 to 4, a pattern that extends to those of the uncalled witnesses, D2 and Mr Wong Yiu Keung. Absent any explanation for these similarities, it is difficult to accept that these written accounts reflect their independent recollections. Nevertheless, this fact alone does not entitle the Court to disregard them automatically.

48.Both parties made other submissions on various aspects of the evidence of the witnesses. It is sufficient to say that those matters have been taken into account, and they do not affect the analysis explained below.

G. ASSESSMENT OF EVIDENCE AND FINDINGS OF FACT RELATING TO ISSUE 1

G.1 The applicable principles relating to Issue 1

49.In Chung Ping Kwan v Lam Island Development Co Ltd [1997] AC 38, Lord Nicholls, delivering the advice for the Judicial Committee of the Privy Council on appeal from Hong Kong, held that:

“However, dispossession of a lessee by a squatter does not set time running against the lessee's landlord. The landlord's right to recover possession from the squatter on the determination of the lease is not barred by a squatter's adverse possession against the lessee, however long this continues. In the ordinary course the landlord's right of action accrues when, but only when, the lease ends and the landlord's reversionary interest falls into possession: section 9(1) [of the Limitation Ordinance, Cap 347]. Only then does time start running against the landlord.

The rationale of this provision is that so long as the legal estate created by the lease remains in existence, the landlord has no right to obtain possession of the land from a squatter. The squatter dispossessed the lessee, not his landlord. If the lessee seeks to recover possession it will be sufficient for him to prove he was in possession and that the squatter dispossessed him. […]

On the determination of the lease, therefore, the landlord is entitled to oust the squatter however long he may have been on the land. Those claiming through the landlord are similarly entitled: their right to possession is no better, and no worse, than the right of the landlord from whom they derive their title. So if the landlord grants a new lease, the lessee of the new lease may eject the squatter.” (46E-47A)

50.The above is binding on Hong Kong courts: Wong Chi Hung v Lo Wing Pun [2026] HKCFA 14 §23, Chief Justice Cheung (with whom the other members of the Court agreed). It has been applied to a yearly periodic tenancy in Mutual Luck Investment v Yeung Chi Kuen (No 2) [2003] 1 HKC 90 §§4(a), 18-22 by DHCJ Lam (as he then was).

51.The law was reaffirmed in Chan Yin Shi v Li Tin Sung (2006) 9 HKCFAR 29, where Lord Hoffmann NPJ (with whom the other members of the Court agreed) held at §17:

“As is plain from the language of the Ordinance, adverse possession does not affect the rights of other persons having interests in the land which do not entitle them to possession. In the case of land subject to a lease, the person entitled to possession is the lessee. The freeholder has no right to possession until the lease comes to an end. Adverse possession by a squatter may therefore bar the remedy of the lessee but will not affect the right of the freeholder to claim possession when the lease falls in.”

52.In Tsang Wing Kit Eric v Occupiers [2009] 3 HKC 496, DHCJ To applied the same principle to an oral periodic tenancy granted by a landlord to a person trading as “Luk Kee” to dismiss the defendants’ claim for adverse possession (§§17-18, 24, 34-36 and 43). His judgment was affirmed on appeal: CACV 157/2009 (unreported, 28 June 2010). Tang VP held at §14:

“The fact that these defendants have been occupying the Subject Land since 1970 cannot avail them, since the learned judge has found that during that period the Subject Land had been occupied by Luk Kee, as a licensee of the plaintiff at the material time.”

53.Miss Ho submitted that it is not open to P to advance Issue 1 since P fails to sufficiently plead a case of either lease or licence, which are inconsistent with each other. Reliance is principally placed on Kwan Chun Investments Limited v Sik Tak Kwong, Ko Mei and Sik Chi Hang, the managers of Chung Fung (or Fun) Wing T’ong [2021] HKCFI 714 §45, where Linda Chan J held that “it is incumbent upon the party alleging that there was a tenancy to plead the material facts of such tenancy”.

54.In my view, that case does not assist D1. In that case, the 1^st defendants were managers of a T’ong who were absent and not represented at trial. The 2^nd defendant was set up to manage the T’ong’s affairs (§§15-17). The plaintiff claimed specific performance of a deed of licence entered into between the T’ong and P (§§2, 10) against both defendants for their “breach of contract” (§39). The plaintiff also formulated a proprietary claim in four alternative ways which involved arguments that the deed of licence “created a tenancy [or] a licence coupled with a grant of an interest”, and “gave rise to an equitable interest” (§40). In these circumstances, with respect, Her Ladyship was entirely correct to hold that the plaintiff could not advance such case to support these causes of action without pleading the necessary facts in support thereof (§§45-46).

55.As submitted by Mr Lau, P is not advancing a positive case of lease or licence in the sense of completing a cause of action, upon which it bears the legal burden of proof. The correct position in this context has been explained in the following cases.

56.In Tsang Woon Ming v Tsan Hing Tat Heidi [2024] 1 HKLRD 316, Chu VP held at §25 that the legal burden lies on the trespasser to prove a lack of consent on the owner’s part, while the owner only bears an evidential burden to raise an issue of licence:

“The parties accept that the plaintiff [trespasser] carries the legal burden that he is in possession of the Lot without the consent or permission of the paper-title owner and the defendants [owners] carry the evidential burden of showing that his occupation of the Lot is by way of an implied licence. This concession accords with the law on adverse possession that the squatter has to show that he is dealing with the land as of right without the consent or permission of the paper-title owner. This clearly puts the legal burden on the squatter that he is in factual possession with the intention to possess and the paper-title owner carries the evidential burden that the occupation is with his permission and consent.”

57.In Wu Yee Pak v Un Fong Leung CACV 172/2002 (unreported, 5 June 2002) Rogers VP (with whom Burrell and Stone JJ agreed) held at §8:

“[I]t is not necessary that the terms of any licence are precisely defined if the facts show that the person in possession of the land did not purport to do so adversely to the owner.”

58.Similar principles are applied in Lu Xiaohua v 砂勞越（建大）有限公司 [2022] HKDC 78, a factual aspect of which resembles the present actions. In that case, the plaintiff claimed adverse possession of Lot 213 since the 1960s (§33). Her witness (CL Wong) admitted that Lot 213 had been “rented” by one Wong’s Uncle for farming from the 1960s until about 1986 or 1987 (§110). DDJ Philips Wong rejected at §119 her claim for adverse possession for that period for the reasons at §§115-116:

“115. […] [Counsel for the plaintiff trespasser] argues that if the leaseholder has rented the land by way of a mere licence, to whom the licensee has no right to exclude the leaseholder from re-entering the property at any time for the duration of the licence, the squatter will still be possessing against the leaseholder and not the licensee as the licence itself does not confer any proprietary rights to the squatter in question but only the right to use the land.

116. The problem with [this] submission is that there is no evidence suggesting that Wong's Uncle’s lease for the Lot 213 was a mere licence, or that he did not have the right to exclude the leaseholder from re-entering the property as he has suggested. The burden is on the plaintiff to establish adverse possession against the defendant, and so it is for the plaintiff to demonstrate that despite the own admission of CL Wong that Lot 213 was subject to a lease at the material times, the plaintiff’s alleged possession of the same could be relied upon as to extinguish not just the tenant’s claim, but also the landlord’s claim. The plaintiff has plainly failed to demonstrate so.” (emphasis added)

59.It is therefore open to this Court to make the findings of fact under Issue 1, and to rule on their legal consequences. In any event, I would find that P has sufficiently pleaded its case on the rental arrangement so that this Court could entertain Issue 1.

G.2 Assessment and findings on Issue 1

60.Having considered the evidence as a whole with regard to the parties’ submissions, I accept the evidence of P’s witnesses on Issue 1.

60.1 Mr Tsang was an impressive witness whose evidence was unshaken under cross-examination. His responses to questions were direct, precise, and consistent. He made quick and frank admissions of matters truly beyond his personal knowledge, and stated the source of his hearsay evidence on the sub-rental arrangement (ie Mr Leung).

60.2 His evidence on the rental arrangement with Mr Leung is supported by the rental slips produced. Despite D1’s acceptance that their authenticity is not open to challenge, their truthfulness has been forcefully affirmed by Mr Tsang under cross-examination. Miss Ho’s suggested “deficiencies” - such as the absence of specific references to “Lot 1249” and whether they were issued for the preceding as opposed to the forthcoming year - do not materially affect Mr Tsang’s credibility and reliability on the crucial aspects of his evidence.

60.3 The above rental arrangement is further supported by the indirect evidence of Mrs So and Mr Chan.

61.The evidence given by D1’s three witnesses, even if accepted, would not cast any doubt on the veracity of P’s evidence on Issue 1.

61.1 They gave no direct evidence on Issue 1, let alone evidence contradicting that of Mr Tsang. They could only say they did not know Mr Tsang and had never seen him or any person claiming to be him (or his representatives), and they did not pay rent to him.

61.2 Importantly, D1 accepted that he did not know who the landlord(s) of the Lot were. He could have no knowledge as to whether any rental arrangement existed between the owners of the Lot and other persons.

61.3 Lastly, Mr Chow’s evidence that he never paid rent to Mr Tsang hardly assists D1’s case. As fairly acknowledged by Miss Ho, there is no evidence that the “周國成” mentioned in Mr Tsang’s evidence in fact refers to Mr Chow himself, although they appear to bear the same name. Despite his asserted occupation on the Lot “all along”, he failed to adduce any documentary evidence at all to prove his residence.

61.4 Irrespective of the existence of any rental arrangement for the Lot between Mr Tsang and 周國成 in the 1980s, and even if the 周國成mentioned by Mr Tsang is in fact Mr Chow, the clear evidence of Mr Tsang - supported by documentary evidence in the form of rental slips - showed that the arrangement existed at least until 3 March 2013. Consequently, because the present actions were commenced on 11 July 2022, they fall well within the 12-year limitation period.

62.Further, Mr Chow’s evidence on Issue 1 is unsatisfactory and unreliable to say the least, and I refuse to accept it.

62.1 Mr Chow is a defendant in two actions, DCMP 2449/2022 and DCMP 2450/2022, commenced by P for possession of the Lot in respect of his alleged occupation thereon.

62.2 Regarding his witness statement’s execution, Mr Chow initially testified that a staff member had called to invite him to the firm’s office without discussing the case. Minutes later, he contradicted himself by detailing the specific questions asked during that call, explaining that he had previously forgotten those past events.

62.3 After he arrived at the law firm, he had a 15-minute discussion with a staff member without any draft on hand, and then waited for about an hour for a draft to be prepared. He signed the statement after confirming its content, but he told the Court that it did not capture his account word-for-word (逐字逐句).

62.4 In re-examination, he stated that during the 15-minute pre-statement discussion, a staff member had told him eight points and questioned him one by one[60]. He then listed five points of discussion, saying he had forgotten precisely what the eight points were[61]. He then explained that, in fact, the eight points only emerged in the draft witness statement after the discussion.

63.Following my acceptance of P’s evidence on Issue 1 as summarised in Section D.1, P has discharged the relevant evidential burden, while D1 has failed to prove the non-existence of the rental arrangement from the 1980s to 2015. Alternatively, even if P bears the legal burden of proving the arrangement’s existence, P has established it to the requisite standard.

64.My core findings of fact relating to Issue 1 are summarised as follows:

64.1 The Tsang family had owned the Lot since at least 1906. Mr Tsang has been living in Kau Wa Keng Old Village since his birth in 1938. He became a co-owner of the Lot in about 1951. He collected the rent and gave it to his mother.

64.2 Mr Tsang had all along rented the Lot on a periodic yearly basis to different persons, renewable in March every year: a Lee family, a Shum family, the family of 周國成 and Mr Leung.

64.3 From the 1980s until Mr Tsang ceased to be a co-owner of the Lot in September 2015, Mr Leung (for the co-owners) rented the Lot to various persons on a periodic yearly basis, renewable in March each year. Mr Tsang would walk for about 25 minutes from his residence to the Lot to collect the rent in March every year, and Mr Leung would pay the same. The amount of rent was HK$1,000 to HK$1,200 in about 2011.

64.4 After Mr Tsang ceased to be a co-owner of the Lot in September 2015, he continued to manage this rental arrangement and receive such rent from Mr Leung until 2016 for Ultra Sky Limited. Mr Tsang was allowed to, and did, keep the rent so received.

64.5 For the above rental arrangement, Mr Tsang would issue signed rental slips to Mr Leung, using standard forms purchased from a stationery shop. The last rental slip he could find referred to the rental arrangement that ended in March 2013.

64.6 To Mr Tsang’s knowledge, the Lot was sub-rented to other occupiers, first by 周國成 and then by Mr Leung, from the late 1970s until Mr Tsang ceased to be a co-owner in September 2015. He did not object to this sub-rental arrangement as long as he received the yearly rent on time.

65.In the absence of any evidence suggesting that the rental arrangement between Mr Tsang and Mr Leung constituted a mere licence, time could not begin to run against the co-owners of the Lot during the currency of that arrangement. D1’s counterclaim therefore fails.

H. ASSESSMENT OF EVIDENCE AND FINDINGS OF FACT RELATING TO ISSUES 2 to 4

66.In my view, P’s evidence relating to Issue 1 is overwhelming and not affected by D1’s challenges thereto (which are not substantiated) when viewed together with P’s evidence relating to Issues 2 to 4. On this basis, and for the reasons explained in Section G above, the analysis in this part is not strictly necessary and is included for the sake of completeness.

H.1 The applicable principles relating to Issues 2 to 4

67.The undisputed principles governing adverse possession were summarised by Harris J in Tsang Foo Keung v Chu Jim Mi Jimmy [2017] 3 HKC 527 at §22 (with whom Cheung and Yuen JJA agreed):

67.1 If the law is to attribute possession of land to a person who can establish no paper title to it, he must be shown to have had both factual possession during the 12-year period and the requisite intention to possess.

67.2 What constitutes a sufficient degree of exclusive physical control depends on the circumstances of the case and, in particular, the nature of the land and the manner in which land of that nature is commonly enjoyed. What must be shown is that the alleged possessor has been dealing with the land as an occupying owner might expect to deal with it.

67.3 The requisite intention is to exclude the world at large, including the owner, from the land so far as is reasonably practicable and so far as the law allows.

67.4 The person claiming adverse possession has the burden of proving both exclusive physical control and the requisite intention. Although the standard of proof is still the normal civil standard, ie on the balance of probabilities, commensurate with the serious consequences of finding that the holder of the paper title has been dispossessed the evidence of exclusive possession and intention must be compelling. It cannot be lightly assumed that the paper title holder has foregone his interest in land.

67.5 Evidence of subjective intent should be approached with caution. Intention is normally better assessed by inference drawn from the acts of the possessor in the light of the nature of the land and its use.

67.6 If a person takes possession by virtue of a licence granted by another, it is the licensor who is treated as being in possession.

68.On the last point, permission may be given unilaterally and does not require acceptance by the licensee. It may be given orally or in writing (express licence) or by conduct (implied licence). However, passive acquiescence is not sufficient to establish an implied licence. Rather, there must be some overt acts on the part of the licensor referable to the licence having been granted to give rise to an implication by conduct: Chow Chi Yuen v The Incorporated Owners of Wing Shun Building [2020] HKCFI 3085 §§16-17, DHCJ Alexander Stock SC.

H.2 Assessment and findings on Issues 2 to 4

69.The evidence of D1’s witnesses is inherently improbable, incredible and unreliable, apart from the fact that the important aspects of their witness statements are clearly products of plagiarism. I reject their evidence insofar as it is put forward to support D1’s case.

70.The unsatisfactory features of D1’s evidence on Issues 2 and 3 are illustrated by his evidence under cross-examination.

70.1 Regarding the conversation where Mr So allegedly “gifted” him “6F”, D1 initially said that he only knew that Area-3 was called “2A” when he got documents from lawyers after legal proceedings commenced, but he then admitted that he had already known in 2009 that Area-3 comprised “2A”[62].

70.2 D1 also gave conflicting evidence regarding the alleged conversation with Mr So. He initially said Mr So used the term “rent” (租金) but not “licence fee” (許可費). When he was asked whether Mr So actually said “no one interfered with his sole use of 6F”, he said he had really forgotten these things. One minute later, he changed to say Mr So did use those words. He was then able to confirm Mr So did use the terms “own property” (自己財產) and “successor” (繼承人). Eventually, D1 admitted that he could not remember very clearly what happened on that day (regarding the conversation), except that Mr So offered to gift him the unwanted house and that there was no need to pay any rent or fee[63].

70.3 This conversation is inherently improbable. Mr So was unlikely to have used technical terms like “own property” and “successor”. It is even more improbable that Mr So would offer to gift his “own property” to a neighbour, particularly when he had a son with a family of his own.

70.4 D1’s evidence on Issues 2 and 3 is also inconsistent with: (1) that of Mr Wong, who suggested that Mr So had transferred the “occupation right” to D1 before moving out of the house; and (2) D1’s own pleading that Mr So told him that Mr So “would” move out of the house so that D1 might take it as a gift[64].

71.D1’s evidence on Issue 4 is also unsatisfactory.

71.1 In chief, he admitted occasionally paying HK$400 to Mr Chan as protection money due to harassment (滋擾), stopping only after Chan attempted to damage his house lock. Under cross-examination, he specified that these payments occurred briefly between 2009 and 2010 and once every two to three months, explaining that he had otherwise forgotten the matter[65]. A while later, he denied having said he paid money to Mr Chan once every two or three months, insisting that he only said “occasionally” [66].

71.2 D1 initially claimed that Mr Chan’s son had harassed him by forcefully kicking his door. He then retracted this, admitting that he did not actually know the perpetrator's identity because his door was closed.

71.3 Under cross-examination, D1 proffered for the very first time the reason for Mr Chan’s repeated demands for money. D1 knew that Mr Chan had lived in House 6F(CKK) before 2006, but had since moved. He stated that, on a certain day after he moved into the house in 2009, Mr Chan visited “6F” and alleged that D1 had occupied “this house” owned by him (之前我嘅, 你霸左). At that time, they did not refer to it as “6F”. Chan demanded payment of rent for his occupation in an angry manner. D1 countered that Chan had given up this house upon moving to a public housing unit (上左樓放棄間屋), and asked for proof of his ownership. A heated exchange and a tense stand-off (僵持) ensued. Chan requested D1’s mobile number for ease of future communication (方便日後溝通). D1 thought it was just a number, so he gave it to him[67].

71.4 After the aforesaid incident, D1 asked Mr Chan for proof of his ownership on two or three occasions, but Chan failed to do so. D1 maintained that, if Chan could prove his ownership, he would give the house back to Chan (我俾番佢)[68].

71.5 The above exchanges between D1 and Mr Chan are materially different from D1’s evidence in chief, which simply alleged that Chan was a village bully seeking extortion money.

71.6 The late disclosure of the aforesaid incident impacts significantly on the credibility of D1’s case in general. Moreover, if D1’s account of the above exchanges were true, it would tend to support P’s case that Mr Chan had rented his house to D1, and that D1 failed to pay rent. It is inexplicable why D was willing to “give back” the house to Chan upon his proof of ownership, if D1 had indeed been gifted this as a derelict house in 2009 by Mr So and did not need to pay any rent for taking it over.

71.7 P adduced a video[69] showing the incident in 2014 in which Mr Chan tried to enter the house occupied by D1 on the Lot. Contrary to D1’s evidence that Chan was breaking the door (爆門), it showed that he attempted to pick the lock (撬鎖) as stated in Mr Chan’s evidence. Chan also said he had given a 1.5-month notice to D1, but he failed to move out. This incident, together with D1’s own evidence at trial, is consistent with P’s case that Mr Chan was not a village bully seeking extortion money.

72.Mr Wong’s evidence mainly concerns Issue 3. It is unsatisfactory and unreliable, and I refuse to accept it.

72.1 He gave at least four different answers within a few minutes on whether he actually used the word “occupation right” (佔用權) when he gave his account to the law firm’s staff member who interviewed him: “No”, “Yes”, “I was not very clear on the words”, and lastly “treat as yes then” (係原話啦當) which he explained as meaning “yes”[70]. His last answer was that he did use such words. It is inherently improbable for a layman in Mr Wong’s position to use such a technical legal term.

72.2 He then recounted an important conversation when he met Mr So on the roadside near the Lot. Mr So said that he no longer lived there, having moved to public housing, and that he let D1 live there (而家都唔住…俾 [D1] 住). Mr Wong recalled this event before the trial but he had not informed D1. This account is contradicted by Mrs So’s testimony that Mr So never went back to the Lot after moving out.

72.3 His evidence on how Mr So had “gifted” the “occupation right” to D1 was also unsatisfactory and inconsistent with D1’s evidence. First, Mr Wong said that “6F and 2A should be the same unit” (應該同一個單位)[71]. If so, it is inexplicable why he only referred to “6F” in his witness statement. This assertion has little evidential value because he failed to identify “6F” and “2A” or to explain what they meant. Second, his evidence, which appears to suggest that Mr So had transferred the “occupation right” to D1 before moving out of the Lot, plainly contradicts D1’s evidence that Mr So had already moved out of his house on the Lot when offering to gift him the same, referring to it as a derelict house (爛屋).

72.4 Similar to Mr Chow, Mr Wong failed to adduce any documentary evidence to substantiate his assertion that he lived on the Lot.

73.On the other hand, the evidence of P’s witnesses on Issues 2 to 4 is consistent and unshaken under cross-examination and supported by contemporaneous documents as well as the evidence of other witnesses in material respects. I accept their evidence, in particular that summarised in Section E.1.

74.My core findings of fact relating to Issues 2 to 4 are summarised as follows:

74.1 In 1989, Mr Chan took over House 6F(CKK) in Area-1 from D2, as evidenced by the handwritten agreement[72]. He lived there until 2006, when he moved to a public housing unit. Only his structure was called “6F”. In 2006, he rented House 6F(CKK) to D1 for a monthly rent of HK$400, but D1 failed to pay rent punctually for two months since the end of 2013. As a result, Mr Chan stopped permitting his use in April 2014, and sought to regain possession on 3 May 2014 by attempting to pick the locks of his house.

74.2 From about 1996 to 2004, Mr So and Mrs So lived in the blue area on the R&DC Plan, which was outside the Disputed Area. They never lived within the Disputed Area itself. Mr So paid rent in cash to Mr Leung during that period, as evidenced by the relevant rental receipts for certain periods in March 1996 to December 1996 and July 1999 to December 1999[73].

74.3 In about early 2000, Mrs So bought a structure in No 2A (shown as the Area-3 (striped) on the R&DC Plan) for her son and his family, who lived there until 2003. Mr So and Mrs So moved elsewhere in 2004.

74.4 Mr So never gifted D1 any house, whether described as “6F” or at all.

75.D1’s counterclaim fails on this additional ground.

I. DISPOSITION

76.For the above reasons, I make an order in the following terms on the basis of counsel’s agreement at the end of the trial:

76.1 D1’s counterclaim be dismissed.

76.2 D1, D3 and D4 do deliver to P vacant possession of the Disputed Area within the Lot within 28 days from the date of this order.

76.3 D1, D3 and D4 do demolish and remove the structures, objects and/or materials erected, placed or remaining within the Disputed Area at their own expenses within 28 days from the date of this order (“the demolition order”).

76.4 In default of compliance with the demolition order within the prescribed time, P or its authorised agents be at liberty to carry out the demolition order, and recover the costs and expenses incurred thereby from D1, D3 and D4 on a full indemnity basis.

76.5 An injunction be granted retraining D1, D3 and D4, whether by their tenants, licensees, agents, employees or servants whosoever, from entering into, placing any objects, structures or goods on, or otherwise trespassing upon the Lot or any part thereof, except for the purpose of carrying out the demolition order.

76.6 D1, D3 and D4 do pay P nominal damages for trespass in the sum of HK$100, with interest at judgment rate from the date of this judgment until full payment.

76.7 D1 do pay P costs of the claim and counterclaim in the two consolidated actions (including all costs reserved) with certificate for one counsel, to be taxed if not agreed.

77.I thank Mr Lau (appearing with Miss Cheung) and Miss Ho for their good sense and realism in this trial.

Mr Kin Lau and Miss Dora Cheung, instructed by Woo Kwan Lee & Lo, for the Plaintiff (by Original Action) and 1^st Defendant (by Counterclaim)

Miss Ivy Ho, instructed by Ngans Lawyers LLP, for the 1^st Defendant (by Original Action) and the Plaintiff (by Counterclaim)

The 3^rd and 4^th Defendants (by Original Action) were not represented and did not appear

The 2^nd Defendant (by Counterclaim) were not represented and did not appear

Appendix 1 ― The Plan

Appendix 2 ― R&DC Plan