Lee Pao King v. Ng Lan and Others

HCA001190/1973

IN THE SUPREME COURT OF HONG KONG

(ORIGINAL JURISDICTION)

ACTION NO. 1190 OF 1973

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Coram: Hon. Cons, J.

Date of Judgment: 13th June, 1974.

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JUDGMENT

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1. This is an action to recover possession of 476, Ground Floor, King's Road. The plaintiff is the registered owner of those premises. The defendant is a lady known as NG Lan. NG Lan apparently occupies a small portion of the cockloft for herself. The remainder she has sublet, and the sub-tenants to whom she has sublet appear as the 2nd to the 7th defendants before me. I am not concerned in this trial with the 1st defendant. Although called as a witness by one of the defendants she has not been a party to this trial at all.

2. The 2nd defendant is a Mr. CHUI Yau-fook. He runs a mahjong shop in one of the front halves of the premises. At one time he used to make the mahjong sets there as well as selling them, but he tells me that now he purchases them elsewhere and re-sells. He lives alone, his family being in China. He has partitioned off a small part of his premises for use as sleeping quarters for himself. In the other half of the shop front a Mr. SUEN Siu runs a glass and mirror framing shop. He has a wife and four children living with him, and for this purpose he has partitioned off one or one and a half rooms just behind his part of the shop. He has also a very small kitchen at the very rear part of the premises. I think that probably this was not an original part of the building, but it is substantially constructed and now integrated with the rest.

3. As far as these two persons are concerned, that is the 2nd and the 4th defendants, I would have no hesitation in saying that their sub-tenancies are business sub-tenancies. What each of them basically has is a shop which has been modified to some extent to provide living accommodation for himself or himself and his family. In his defence, the 4th defendant has suggested that the area which he and his family use for living is greater than the area which he uses for business. That is possibly so if one includes the kitchen at the rear, but simple calculation of floor areas is not a conclusive test as to the nature of the tenancy. In addition a certificate in respect of each of these two sub-tenancies has been issued by the Commissioner of Rating and Valuation. He has certified that both of those sub-tenancies are non-domestic, and neither sub-tenant has done anything to displace the prima facie value of those certificates.

4. There are four other sub-tenants. Two of them live in the cockloft and two live downstairs. These four sub-tenancies are primarily domestic. Three are completely so; the fourth one is that of Mr. YUNG Chung-gun who has a downstairs cubicle and the use of the yard. That yard was once open to the sky. It is now almost completely and quite substantially covered. It has in fact become part of the covered premises themselves. I think it probable that at some stage, and from time to time, either Mr. YUNG Chung-gun or his father has used that yard for sewing shoes. It may not be that they do so now, it is impossible to say, but there is evidence that on one occasion a person was seen there working at a sewing-machine, and Mr. YUNG accepts that on several occasions, the principal tenant asked him to hand over the rent to the rent collector because she was going to be out. This is some indication that at that time Mr. YUNG had a job which allowed him to remain in the premises rather than his present one of a mini-bus driver. But however that may be, it makes no difference. Even if there were occasional use of a sewing-machine with regard to shoes in that yard, that is insufficient to take away the basic domestic nature of that sub-tenancy. If those four sub-tenancies should be considered separately I would find that they are domestic.

5. But it is not correct that they should be considered separately, and this is a crucial point in this particular case. As I understand the law, a tenancy is one indivisible whole. That is why when the landlord wishes to serve notice upon his tenant, he can only serve notice in relation to the whole of the tenancy. If he tries to serve notice in relation to only part of the tenancy, it has long been established that that would be a bad notice. I can think of only two ways in which a tenancy can be sub-divided. One of those ways would be by mutual agreement of everybody concerned. The other would be as a result of some particular statute. A local example of that would be section 53(6) of the Landlord and Tenant (Consolidation) Ordinance. The question then that I have to consider in this case is, looking at the premises as a whole, are they domestic in nature or business in nature? There is no direct evidence as to the purpose of the original letting to Mrs. NG Lan.

6. Two approaches are then possible, either to say there is insufficient evidence and proceed under para.(2)(c) of section 51 of the Landlord and Tenant (Consolidation) Ordinance, or to infer that it was business from the design of the premises and proceed, notwithstanding that inference, under para.(2)(b). The effect is the same. In either event primary user is the criterion. As to this the plaintiff has obtained a certificate from the Commissioner of Rating and Valuation. It says that the premises are non-domestic, and that is prima facie evidence in this trial; but there is other evidence. I have heard from each of the sub-tenants, and I have had the advantage this morning of seeing the premises and the area in which they are situate. The locality is one which, as far as the ground floors are concerned, and looking at matters from the street angle, is one that is completely given over to business of one kind or another. King's Road in that area is a very wide and busy road, and both sides of the road for a very considerable distance are lined with shops, restaurants or banks. In addition, it is quite clear that these premises were designed as a shop. There is a front area intended to be the actual shop to which the customers would come. This is on two levels with tiled floors. Behind that area is something which was designed either for storage space or for living accommodation for the shopkeeper. If one or perhaps two families were now using these premises as a shop and living at the back I would have no hesitation whatsoever in saying they were business premises. I would still come to the same conclusion however large the families of the shopkeepers might be, for the families would be connected with the shops and their presence there would be because of the shops. This is a very important point in this present case.

7. However these premises have been adapted to allow for and to take in a large number of people who have no connection whatsoever with the two shops. These families are not there because the shops are in the family. These families are there simply because they found them as places in which to live. They have not concealed their presence from the landlord. The situation is immediately obvious to anyone who enters right into the premises, and even a person who stood merely in the shop part and looked towards the rear would have been put on his guard that something other than normal shop business was being carried on there. The shop part of the premises has been considerably shortened, and a cockloft built over quite a large area. Apparently no objection has at any time been raised by the landlord. The people who are there and have no connection with the two businesses, very roughly speaking, outnumber the business people by two to one. A comparative assessment of the areas, if the yard is included, would produce about the same ratic. For this reason I have come to the conclusion that despite the commercial face of the promises shown to the casual traveller along King's Road when looked at as a whole they are now domestic in nature.

8. The legal position of the sub-tenants is then not entirely free from doubt. Mr. TANG has not addressed me on this point and I speak without the benefit of argument, but it seems to me that as far as this trial is concerned the tenancy of Mrs. NG Lan has not been terminated. The Ordinance provides specific ways and specific ways only in which a domestic tenancy can nowadays be terminated and none of those ways has been adopted with regard to Mrs. NG. It follows that the defendants with whom I am concerned are lawful sub-tenants.

9. I would like to add that I have not found this an easy case at all. I would have been much happier if the case had been prepared and argued by counsel on both sides instead of one only. If the plaintiff should decide to take my decision to the Court of Appeal I would certainly advise the defendants to make application for legal aid. The claim of the plaintiff as against the 2nd to the 7th defendants inclusive is dismissed. I will make no order as to costs.

Representation:

Robert Tang (Hastings & Co.) for plaintiff.

2nd, 3rd, 4th, 5th, 6th and 7th defendants in person.