Sunny Elegant Ltd v. Chau Ngo Sheung and Others

HCA 1896/2018

[2026] HKCFI 3852

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1896 OF 2018

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REASONS FOR DECISION

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A.      INTRODUCTION

1.This is a water leakage case.

2.The plaintiff[1] was and still is the registered owner of the premises known as Office Nos.1 – 19 and 5 storerooms situated at the First Floor of Hung Wai Building (“the Building”), 3 – 5 Fa Yuen Street, Mongkok, Kowloon, Hong Kong (“the plaintiff’s Property”).

3.The 1^st to 8^th defendants are the respective registered owners of the 8 flat roofs (“the Flat Roof”) of the 8 units on the Second Floor of Block 1 or 2 (as the case may be) of the Building immediately above the plaintiff’s Property.

4.The 9^th defendant was and still is the Incorporated Owners of the Building.

5.It is the plaintiff’s case that since no later than 2013, water has persistently been leaking and seeping into the plaintiff’s Property and that the source of water leakage and/or seepage is mainly the Flat Roof (i.e. the Podium Floor) immediately above the plaintiff’s Property.  It is alleged by the plaintiff that, as a result of the water leakage problem, the original tenant (Maxim Fast Food) prematurely terminated its tenancy of the plaintiff’s Property.  With a view to mitigating its loss, the plaintiff then re-let the plaintiff’s Property to Yu Chung Man (i.e. the 2^nd defendant (by Counterclaim) (“the Yu Tenancy”).  However, the plaintiff, in light of the water leakage problem, had to reduce rent on numerous occasions which led to further loss and damage.

6.The plaintiff claims for, among other things:

(1)     an order of mandatory injunction against all the defendants for effecting repair of the Flat Roof;

(2)     damages for the loss of rent caused by reason of the water seepage problem.

7.The defendants deny that they are responsible for the alleged water leakage problem.

8.As far as the alleged loss of rental income is concerned, the defendants pleaded, among other things, that the Yu Tenancy is a sham, and that the plaintiff’s loss was caused by the plaintiff’s failure to act reasonably and mitigate its loss.

9.By order dated 17 January 2020, Au-Yeung J appointed Mr Cheung Wai Sum Simon (“Mr Cheung”) as the single joint expert (“the SJE”) to ascertain the source of water leakage to the plaintiff’s Property. 

10.Mr Cheung had since then prepared a number of expert reports, dated 15 January 2021, 29 December 2023, 3 January 2024 and 11 November 2024 respectively (“the SJE Reports”). 

11.At the Pre-Trial Review held on 2 July 2026, the following matters were placed before the Court for decision/direction:

(1)     The plaintiff’s summons filed on 26 May 2026 for further expert directions (“the plaintiff’s Expert Directions Summons”);

(2)     The plaintiff’s summons filed on 16 June 2026 (“the plaintiff’s Witness Statement Summons”) for leave to file the 2^nd Supplemental Witness Statement of Chan Mei Shan (“the Supplementary Witness Statement”);

(3)     Various parties’ objection against the 4^th defendant’s disclosure of certain documents by virtue of his 4^th Supplemental List of Documents filed and served on 23 June 2026 (“the 4^th defendant’s Discovery”);

(4)     The 9^th defendant’s objection against the plaintiff’s disclosure of a tenancy agreement between the plaintiff and Tasty Creation Limited dated 21 March 2025 which was included in the plaintiff’s 3^rd Supplemental List of Documents filed on 28 January 2026 (“the plaintiff’s Discovery”).

B.      THE PLAINTIFF’S EXPERT DIRECTIONS SUMMONS

12.It seems undisputed that the 9^th defendant has carried out waterproofing membrane repaving work after the SJE Reports have been prepared.  It is therefore necessary to know whether such work had effectively remedied the water leakage problem.

13.It is for this reason that the plaintiff asked this Court for leave for the SJE to conduct further test(s) and, inter alia, see whether the plaintiff’s Property is still suffering from water leakage problem, and if so, the location, cause(s), source(s) of such leakage and the remedial work required to cure the problem.  The plaintiff would also ask the SJE to state the exact location, etc of the new waterproofing membrane.  The plaintiff suggested that the SJE’s further expert report (“the Further SJE Report”) shall be lodged within 40 days after the completion of the waterproofing ponding test on each flat roof on the 2^nd Floor of the Building.

14.As a matter of principle, the defendants do not object this application, save that:

(1)     The 1^st, 2^nd, 3^rd and 6^th defendants suggested that the Court should allow the SJE 60 days to complete the Further SJE Report;

(2)     The 9^th defendant took the view that, since the SJE had conducted a 48-hour dye water ponding test on 23 May 2026 which revealed that there were apparent seepage at only 8 locations, the further expert evidence to be prepared by the SJE should be confined to those 8 locations.

15.At the hearing, Mr Ng for the plaintiff informed this Court that the plaintiff has no objection for giving the SJE 60 days to prepare the Further SJE Report as suggested by the 1^st, 2^nd, 3^rd and 6^th defendants.

16.As to the 9^th defendant’s proposal, it was made on the basis of the SJE’s letter dated 26 May 2026 (“the SJE’s Letter”), in which it was stated, among other things, that:

“We refer to 48-hour dyed water ponding test on the flat roofs of the 2/F of Hung Wai Building and subsequent inspection and detection at 1/F of Hung Wai Building (Plaintiff’s Premises) on 23 May 2026.

We regret to inform you that we have detected, located and identified 8 locations of the apparent seepage on the concrete ceiling of the Plaintiff’s Premises which are marked up and clouded on the floor plan (see attached).

We are of the opinion that the re-waterproofing works done by appointed contractor of the 9^th Defendant is considered unsuccessful and remedial works is required to rectify the leakage areas at the soonest. Moreover, another time of colour dyed water ponding test on entire flat roof at 2/F is required to strictly demonstrate the watertightness of the new waterproofing system.

[…] ”

17.It can be seen that, despite the SJE’s view that 8 locations of the apparent seepage on the concrete ceiling of the Plaintiff’s Property have been identified by a ponding test which was done on 23 May 2026, the SJE further suggested that “another […] colour dyed water ponding test on entire flat roof at 2/F” should be done.  In my view, in that case, there is no reason why the SJE’s hands should be tied.  He should be left to consider what further tests should be done for the purpose of answering the expert issues.

18.I would therefore accede to the plaintiff’s application made pursuant to the plaintiff’s Expert Directions Summons and make an order in terms of paragraphs 1 – 3 thereof, save that:

(1)     The due date for the lodging of the Further SJE Report under paragraph 2 thereof should be revised to 2 September 2026;

(2)     7 days (instead of 14 days)’ prior notice should be given by the SJE should inspection / tests are required to be done at the respective premises of the parties of the Original Action.

C.      THE PLAINTIFF’S WITNESS STATEMENT SUMMONS

19.The Supplementary Witness Statement only contains 2 substantive paragraphs:

(1)     Paragraph 3 thereof alleges that the plaintiff’s director has always been lenient and would allow his tenant time to pay outstanding rental.  Reference has been made to a recent Lands Tribunal Judgment in which the plaintiff had tolerated for more than 15 months before the plaintiff commenced legal proceedings for the recovery of such outstanding rental;

(2)     Paragraph 4 thereof refers, inter alia, to the SJE’s Letter, and states that, according to the SJE, 8 locations of seepage could still be identified despite the 9^th defendant’s laying of a new waterproofing membrane.

20.In my view, the plaintiff’s Witness Statement Summons should be dismissed because:

(1)     Whether the plaintiff had tolerated its tenants in other cases is irrelevant for the present purpose;

(2)     The Supplemental Witness Statement has no probative value as far as the success of the relaying of a new waterproofing membrane is concerned because this aspect of the case will be covered by the Further SJE Report to be prepared.

D.      THE 4^TH DEFENDANT’S DISCOVERY

21.On 23 June 2026, the 4^th defendant filed and served his 4^th Supplemental List of Documents by which he disclosed a total of 11 items of documents. 

22.The plaintiff, the 1^st – 3^rd defendants, the 6^th defendant and the 9^th defendant took issue with such late discovery of documents in their respective written submissions.

23.Mr Wong for the 4^th defendant clarified at the hearing that the 4^th defendant actually does not intend to rely on those 11 items of documents at the trial, and the said 4^th Supplemental List of Documents was only filed in strict compliance with the 4^th defendant’s ongoing duty of discovery.

24.Hence, there was in fact nothing in this matter which required this Court’s adjudication.  Having said that, for the avoidance of doubt, I order that the said 11 items of documents should not be included in the trial bundle.

E.      THE PLAINTIFF’S DISCOVERY

25.By virtue of its 3^rd Supplemental List of Documents filed on 28 January 2026, the plaintiff disclosed a tenancy agreement between itself and Tasty Creation Limited dated 21 March 2025 (“the New Tenancy Agreement”), under which the plaintiff’s Property was purportedly leased by the plaintiff to Tasty Creation Limited for a period of 3 years from 18 January 2025 at a monthly rental of HK$300,000.

26.The 9^th defendant took issue with the said disclosure.

27.As the plaintiff’s counsel admitted, as the plaintiff’s pleaded case now stands, it is only claiming for loss of rental up to 15 October 2024.   Therefore, in my view, the New Tenancy Agreement is irrelevant for the purpose of the upcoming trial.

28.Hence, it should not be included in the trial bundle.

F.      ORDER

29.I make the following orders:

(1)     Leave be granted to the parties (by Original Action) to adduce further expert evidence by Mr Cheung Wai Sum Simon as the single joint expert on the issues as set out hereinbelow:

(a)     Whether the plaintiff’s Property is still suffering from any or any ongoing water seepage problem;

(b)     If the answer to issue (a) above is in the affirmative, identify the location(s) of the plaintiff’s Property which is/are so affected;

(c)     If the answer to issue (a) above is in the affirmative, state the cause(s) and source(s) of such ongoing water seepage problem;

(d)     If the answer to issue (a) above is in the affirmative, state the remedial work(s) which is/are required to be carried out so as to solve the water seepage / ongoing water seepage problem; and

(e)     State the exact location of the further and/or replacement waterproofing membrane installed above the plaintiff’s Property since December 2025.

(2)     The plaintiff (by Original Action) shall lodge with the Court a copy of the written report to be provided by Mr Cheung on or before 2 September 2026.

(3)     For the purpose of complying with these expert directions, the parties (by Original Action) shall allow Mr Cheung to inspect their respective premises and conduct all necessary tests therein upon at least 7 days’ prior notice in writing given by Mr Cheung.

(4)     The parties (by Original Action) do initially pay and disburse equally (i.e. 1/10 each) the costs and disbursement of Mr Cheung in preparing for such further expert report and such costs shall become part of the costs of the Action in the cause.

(5)     There be liberty to apply.

(6)     The plaintiff’s Witness Statement Summons be dismissed.

(7)     The New Tenancy Agreement and the documents disclosed by the 4^th defendant by virtue of his 4^th Supplemental List of Documents shall not be relied upon nor to be included in the trial bundle.

G.      COSTS

G1.    The plaintiff’s Expert Directions Summons

30.The plaintiff asked for the costs of the plaintiff’s Expert Directions Summons.

31.Although it is true that none of the parties had ever indicated any objection against the plaintiff’s proposed application for an updated expert report, it is evident that none of the defendants had given any positive reply to the plaintiff’s draft consent summons which was sent by the plaintiff’s solicitors by letter dated 28 April 2026.  The only party which had replied was the 9^th defendant, which did not agree to the scope of the further tests to be done.

32.In the circumstances, I am of the view that a fair order for the plaintiff’s Expert Directions Summons should be the plaintiff’s costs be in the cause.

G2.     The plaintiff’s Witness Statement Summons

33.I have dismissed the plaintiff’s application to adduce the Supplementary Witness Statement.

34.Costs should follow the event.  However, since the 5^th, 7^th and 8^th defendants (by Original Action) as well as the 2^nd defendant (by Counterclaim) did not raise any objection to the said summons, they should not be entitled to any costs. Hence, I make no order as to their costs of the plaintiff’s Witness Statement Summons.

35.For (1) the 1^st – 3^rd and 6^th defendant, (2) the 4^th defendant and (3) the 9^th defendant, I summarily assess their costs at $3,000 each (i.e. $9,000 in total), which shall be paid by the plaintiff no later than 16 July 2026.

G3.    The 4^th defendant’s Discovery and the plaintiff’s Discovery

36.By virtue of this Court’s decisions, certain documents have not been permitted to be included in the trial bundle.

37.In my view, no specific costs order should be made in respect of the arguments in relation thereto.  Such costs shall be treated as part of the costs of the PTR which, pursuant to the PTR directions which I have given at the hearing on 2 July 2026, should be in the cause of the action.

Mr Ernest Ng and Mr Fergus Tam, instructed by Christine F. L. Ip & Young, for the plaintiff (by Original Action) and the 1^st defendant (by Counterclaim)

Mr Jason Kung, instructed by Chan & Chan, for the 1^st, 2^nd, 3^rd & 6^th defendants (by Original Action)

Mr Paul Wong, instructed by Kevin L. H. Kwong & Co, for the 4^th defendant (by Original Action)

Ms Lok Wing Yan Victoria, instructed by Chan & Tsu, for the 5^th defendant (by Original Action)

Mr Gilbert Kwong, instructed by CLY Lawyers, for the 7^th defendant (by Original Action)

Ms Candy Tang, instructed by Lam Fung & Co, for the 8^th defendant (by Original Action)

Mr Lawrence KF Ng, instructed by Lam & Partners, for the 9^th defendant (by Original Action) and the plaintiff (by Counterclaim)

Mr Gavin Wan, instructed by Lee, Wong & Lam, for the 2^nd defendant (by Counterclaim)