Lam Kam v. Lui Kung Pok

DCCJ001930/1971

IN THE DISTRICT COURT OF HONG KONG

HOLDEN AT VICTORIA

CIVIL JURISDICTION

ACTION NO. 1930 OF 1971

R.I.A. NO. 147 OF 1971

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Coram: D. Cons, D.J.

Date of Judgment:

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JUDGMENT

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1. In these proceedings I have to deal with two actions, namely an application under Section 7(7) of the Rent Increases (Domestic Premises) Control Ordinance Cap.338 and a normal District Court writ for the recovery of possession together with arrears of rent and mesne profits. At one stage an application was made for consolidation. It was refused by one of my learned brothers on the ground that evidence as to greater hardship would not be material in the action upon the writ. With respect to my learned brother I think that was a correct decision. The two actions were therefore tried separately, but on the same day, and what I am now reading is technically a separate judgment in each action. For convenience I read both at the same time.

2. The duplicity of actions has arisen because at one stage, when dealing with matters that are now merely history, one of my learned brothers in Kowloon declined to follow the case of Tiu Chi Sang v. Li Hau Man (1963) D.C.L.R., 187, in so far as that case lays down that the correct procedure to recover possession where the tenant has served no counter-notice to a notice to quit complying with Section 7(2) of the Rent Increases Ordinance, is by way of writ. But Mr. Mak, who appears for the applicant, profited from the knowledge of his more learned opponent and apparently thought it wise to cover himself, as it were, both ways. Without withdrawing the Rent Increase Application he had already filed, he sued out a further remedy by way of writ.

3. The facts as I find them are as follows. In September of 1968 Madam Lam Kam, to whom I will refer as "the landlord", a widow with one son, entered into a written tenancy with Mr. Lui Kung Pok, "the tenant". At the same time she intimated to him that if her son should not marry within a period of three years then he could expect to retain the tenancy for that length of time. This intimation was not incorporated into the written agreement. I am quite satisfied that neither side then intended that it should create binding legal relations between them. The tenancy was nothing more than a normal monthly tenancy. The rent has since been increased by agreement but that is neither here nor there.

4. Two years later, in the November, the landlord sent a notice in Chinese characters to the tenant requiring him to give up the premises within 3 months on the ground that her son intended to marry and wanted the premises for his own use. It was not a valid notice within the Rent Increases Ordinance but was nevertheless acknowledged by the tenant in a solicitor's letter one month later. The solicitor now tells me that I may regard that latter as an effective counter notice. As it neither disputes the right of the landlord to serve notice, nor is in the specified form, I regret that I fail to appreciate his line of thought.

5. The landlord must have realized the inadequacy of the notice. On the 14th of January this year she despatched through her solicitors a second and proper notice, expiring on the 28th of February. The tenant again consulted his solicitor but was advised that the costs of filing a counter notice, and presumably defending any application, would be enormous. Me decided therefor to take no action. He added in his evidence that he thought further action unnecessary because he had already answered the first notice. I do not believe this. I am satisfied that it was only financial considerations that restrained him.

6. The combined effect of the various subsections of section 7 of the Rent Increases Ordinance is that whenever no counter notice is served a notice to quit takes effect in the normal way. It would seem therefore that the tenancy in question has long determined. But the solicitor for the tenant disputes this proposition on three grounds, which might be termed substantive, procedural and remedial.

7. Substantively he argues that the confusion created by the service of two notices in quick succession nullifies the effect of The second of these notices. In support of this argument he referred me to the case of Du Sautoy v. Symes and Others (1967) 1 A.E.R. 25, a case where a litigant was deprived of protection which would otherwise have extended to him under the Land Charges Act of 1925, because his solicitor had incorrectly, and possibly misleadingly, filed in the application form for a search of the register. I have already indicated that I find as a fact that the defendant was not confused as to his position, but I might further add that even if he were, I can find in the case quoted no authority for depriving a correctly worded and perfectly clear notice to quit of its natural consequences.

8. In the procedural realm it is argued that the two forms of action I have here are mutually exclusive; that the landlord having elected to proceed under the Rent Increases Ordinance is debarred from suing out a writ. If that be so the proper course for the tenant would seem to have been to apply to strike out the writ in limine, a course which might have caused him some little embarrassment when, as I have mentioned, the writ was the consequence of his own wisdom. As a matter of practice it must follow, I think, that the two actions are exclusive. They approach the recovery of possession from sets of circumstances that cannot co-exist. I have found myself unable to envisage any situation in which the two actions could currently stand together without mistake on the part of someone somewhere. But I have been offered no authority to show that the position is fatal at law. I think the proper view is that each should be allowed to run its own course and the mistake paid for in due course in the normal way by the imposition of costs.

9. Finally in case he should fail, as he has failed, in these two submissions, the tenant's solicitor has adopted the unusual course of using the Defence filed to the writ as a vehicle to apply for an extension of time to file a counter notice. Under the Rent Increases Ordinance. He was however unable to show me from where the Court would draw the power to grant such an application. It is usually, if sometimes relactantly, accepted that the Court has no such power: Leung Ho Yuen v. Shiu Chun Hau (1964) D.C.L.R. p.129. That case dealt with Rule 4 of the 1963 Rent Increases Rules. The wording is not dissimilar to the current Rule 5. It provides:

"(4) Where under the Ordinance or these Rules time is prescribed for the doing of any act in connection with an application or appeal to the District Court, the Registrar may, on cause being shown in writing, enlarge such time as he shall see fit."

It was held that this rule was of no assistance to a dilatory tenant because the serving of a counter notice was not something that was in connection with a writ, or that if it were, a writ was not an application to the District Court in this sense. With the greatest respect to one of my learned pred ...(illegible) I think his reasons (see pages 40 and 41) would have been easier to follow if he had not dealt with the question of greater hardship ...(illegible) a matter that could be pleaded in Defence to a writ. It is not. The proper, but pointless course, for the tenant would have been to apply for a stay of the proceedings under the writ to enable him to negotiate the consent of the landlord or apply to the Registrar in writing. I say "pointless course", for settlement with the landlord apart, the application to the Registrar would be doomed to failure. I also am of the opinion that the rule cannot be applied to the service of a counter notice. To my mind, with regard to this rule and to Rule 5 of the current legislation, that action is no more in connection with a possible subsequent application by the landlord than is the recovery of judgment with a subsequent appeal by a defeated opponent. Both are conditions which must exist before a particular act may be taken, but it would be stretching the meaning of that phrase too far to say that they are "in connection with" that particular later act. I have been unable in the books to find any useful definition of the phrase with regard to the present circumstances, but it must, I think, connote at least some desire or intention to bring about the final act. It is not sufficient that it may perhaps cause a third party to do so.

10. Furthermore, in view of the strict measures the legislature has imposed to ensure that the provisions of sub-section 6 are on each occasion brought to the notice of the tenant, I entertain some doubt as to whether it can have intended that these provisions should be nothing more than a matter of "the practice and procedure" of the Court (Section 21), the time for doing which could be abridged, as well as enlarged, upon a simple written application.

11. I must concede that if this view be correct the application of Rule 5 will be very limited. Section 5(7) and 12 of the Ordinance do not impose time limits. That in Section 13(4) applies to the very application itself rather than an act in connection therewith. The Rule can probably only be of assistance with regard to notices under Rules 7 and 8. But this is not a reason for extending its orbit to include matters that are not, upon a proper construction, within it.

12. For these reasons I am satisfied that there is no defence to the Plaintiff's claim for possession and I therefore enter such judgment in his favour. There is undi...(illegible)puted evidence that rent has not been paid for the month of February this year and I enter judgment in that respect in the sum of $320. The defendant is still in actual possession of the premises and I order mesne profits at the rate of $320 per month as from the 1st of March 1971 until such time as the defendant surrenders that possession to the plaintiff; with costs on the action by way of writ to the Plaintiff on Scale IV.

13. The application under the Rent Increases Ordinance is mis-conceived and is refused with costs to the respondent, also on Scale IV. I should add however, in case it may be necessary elsewhere, that I am quite satisfied that the intention expressed by the applicant in her notice to quit is genuine. On the question of hardship I would record that neither she nor her recently carried son and daughter-in-law would in my opinion suffer material hardship if the order were refused. They would merely experience delay in realising the pleasures of a united family.

14. The respondent occupies part of the premises - I ignore the portion of his sub-tenants who have likewise filed no counter notice - together with his wife, mother-in-law and brother-in-law; his sister-in-law also makes use of the premises to some extent but spends a large part of her time in Macau caring for an aged grandmother. His evidence was that if he were ejected he would have to find a further sum of perhaps $150 per month out of a net disposable income of only $580. However from his manner of giving evidence with regard to work of a bead stringing nature carried out by his family, and the profits made therefrom, I have grave doubts that he is telling the truth. I think he has materially understated his income from that source. He would not therefore have satisfied me that a move would cause financial hardship. No other form of hardship was put forward.

Representation: