Hong Kong Land Co Ltd v. Cheung Chiu-moon

HCMP000523/1975

IN THE SUPREME COURT OF HONG KONG

(ORIGINAL JURISDICTION)

MISCELLANEOUS PROCEEDINGS NO. 523 OF 1975

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Coram: Cons, J.

Date of Judgment: 9 March 1978

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JUDGMENT

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1. The plaintiff is a company which holds and develops real estate. In 1969 it completed the erection in Shaukiwan of a 29-storey complex which is now known as the Tai On Building. It should have 104 shops on the ground floor, with non-domestic and domestic units above. Most, if not all, of the individual units were sold by the plaintiff during the course of construction, in the sense that the purchaser entered into an agreement for sale with the plaintiff whereby the purchase price would be paid over a number of years, and at the end of the period the plaintiff would execute a formal assignment. At that time the purchaser would be required to enter into a Deed of Mutual Covenant. Alternatively, the assignment would be made expressly subject to a similar deed. That deed contains provisions for the management of the building, which, for the first 12 years at least, is vested in the plaintiff. It also contains certain restrictions upon the use of their properties by the individual owners. In particular clause 19(a) prohibits the erection of "projections or structures whatsoever extending outside the exterior of the building". This is precisely what the defendant has done. He is the owner of two adjoining shops on the ground floor and has erected an iron canopy above the whole length of both of them. He says, as I think the plaintiff would concede, it is a protection to the shop and his customers against the natural elements and against the rubbish that the occupiers of the upper floors are inclined to throw out of their windows. He also claims, with which the plaintiff does not agree, that his canopy is more tidy and less unsightly than the many canvas or terylene sunblinds which other shop owners have put up. The plaintiff acting under its powers as manager of the whole building has demanded that the defendant remove the offending structure. The defendant refuses. Hence this application by the plaintiff for a mandatory injunction.

2. Counsel for the defendant resists the application on two grounds. Firstly he says that the plaintiff has no standing in the matter; that upon a strict construction of the agreement the defendant has not actually entered into any restrictive covenant; that all the agreement does in this respect is to define the interest that the defendant will take in due course when all the payments have been made and the formal assignment and the deed executed; and that until the defendant does execute that deed he is in no way bound by anything contained therein.

3. Now that I have had time to consider this argument I feel, with respect to counsel, that there is no merit in it. The agreement itself clearly imposes the restrictions upon the defendant. By clause 4 he is allowed into possession, but expressly "subject to the terms and conditions of the Deed of Mutual Covenant". Clause 17(b) provides that "the purchaser shall be deemed to have satisfied himself as to the contents of the (Deed of Mutual Covenant) and shall be bound by the terms and conditions thereof". Clause 15 contains an acknowledgement by the defendant that a copy of the Deed of Mutual Covenant has been produced to him. For good measure the draftsman of the agreement has attempted in clause 17 to impose directly the very same restrictions, but his words and punctuation are not as clear as that employed in the actual deed, and it may be that so far as the ground floor owners are concerned he has not succeeded. But the earlier parts that I have referred to are sufficient to bind the defendant and to give a cause of action to the plaintiff.

4. Secondly, the defendant argues that the plaintiff has already acquiesced in breaches by other shop owners. To some extent this is admitted. The plaintiff is willing to allow, and has allowed, shop owners to put up what are considered to be light, temporary canvas sunblinds. The defendant had done the same himself earlier on. The plaintiff thinks that this is a reasonable course to take in view of the weather conditions one often experiences. But the plaintiff is not willing to permit, and has at no time permitted, substantial or permanent structures. It is well established that acquiescence may preclude the grant of relief. It is equally well established that acquiescence in a small breach may not bar relief against a wider breach. The question then in the present instance is whether a distinction can be drawn between the sunblinds of the other owners and the defendant's iron canopy. I think it can. There is a difference between a structure like that put up by the defendant and a light, retractable sunblind. It is not easy to define that difference strictly in words, but it will not usually be difficult to observe the difference in practice. The plaintiff is entitled to draw the line it seeks.

5. As a final hope the defendant seeks to justify his canopy as a proper answer to the plaintiff's failure to prevent upstairs owners from throwing rubbish down in contravention of section 19 of the Deed of Mutual Covenant. There is no evidence as to the extent of this nuisance but even assuming it to be substantial I do not think the defendant can be justified in abating it in a way that is itself in breach of his own obligations. Furthermore I am satisfied on the affidavit of Mr. Edwards that the plaintiff has done all that can be reasonably expected of him in this respect.

6. An injunction will therefore be granted in the terms requested by the plaintiff save that the defendant may have four weeks within which to comply of his own accord.

Representation:

Mr. C.J. Lucas of Deacons for plaintiff.

Edward Chan (H.M. So & Co.) for defendant.