Shiu Choy-chu v. Au King-woon

DCCJ000985/1980

IN THE DISTRICT COURT OF HONG KONG

HOLDEN AT KOWLOON

CIVIL JURISDICTION

ACTION NO. 985 OF 1980

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Coram: B.W.M. Downey, D.J.

Date of Judgment: 16th June, 1980.

Plaintiff and Defendant in person.

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JUDGMENT

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1. In this action the Plaintiff seeks to recover possession of domestic premises situate and known as Flat H on the 8th floor of 55 Mei King Street, Kowloon, on the ground that she requires them for her own occupation. The premises were let to the Defendant for a term of 2 years, commencing on January 1st 1978, at a monthly rental of $630 under the terms of standard form of tenancy agreement expressed in Chinese (Ex. P1). The premises consist of one bedroom, a sitting-room, kitchen and bathroom, amounting in all to a living area of approximately 300 square feet. They are presently occupied by the Defendant, her younger sister, and their mother, who is now aged 75 years. They have lived in the premises since January 1978.

2. Although the tenancy agreement (P.1) contains a clause appearing to give the Defendant an option to continue the tenancy at the end of the agreed term, the Defendant agreed in evidence that she had not given the written notice required by that clause. (In any event, in my judgment, the clause is void for uncertainty. See Wong Keung v. Ng Chiu-chick [1976] D.C.L.R.94) Accordingly, the tenancy expired on December 31, 1979 by effluxion of time.

3. The writ issued on January 28, 1980, but the case could not be heard until June 2 and 3, 1980, when both parties gave evidence before me. Both parties relied on the hardship they would suffer if an order for possession were made or refused. But, in addition, the Defendant complains that she was not given 6 months' notice in writing of the Plaintiff's intention to recover the premises for her own occupation. It is common ground that on several occasions, before and after the termination of the tenancy by effluxion of time, the Plaintiff orally communicated her intention or desire to occupy the premises as a residence for herself. It is equally not disputed that the Plaintiff has never given written notice of such intention to the Defendant. In the circumstances, is the Plaintiff debarred in limine from recovering possession by these proceedings because of the absence of such written notice?

4. In paragraph 2 of the Defence, filed on February 28, 1980, the Defendant alleged that she was entitled to such notice by the terms of the tenancy agreement. In this respect, she is in my view, clearly mistaken. The agreement contains no provision requiring the Plaintiff to give any notice of her intention to use the premises for her own future occupation. Indeed any provision to this effect would be most unusual in a tenancy agreement for a fixed term. The Defendant's firm and, in my view, honest belief that she was entitled to receive 6 months' notice in writing of the Plaintiff's intention to require the premises for her own occupation more probably stems from advice which the Defendant apparently obtained from the Secretariat for Home Affairs sometime in 1979. When this was obtained is not clear, as both parties were somewhat vague as to dated, but it must have been sometime between the time when the Plaintiff first indicated that she would require the premises for her own use, which I find to be be in or about August or September 1979, and November or December, when the Defendant was asserting what she understood to be her legal rights in various conversations with the Plaintiff. This advice was no doubt given on the basis that the premises were then subject to the provisions of Part v of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7), as in my judgment they were, albeit in apparent ignorance of the amendment, enacted on June 6, 1979 (ie. Ordinance No. 39 of 1979), which extended the period of notice from 6 months to 12 months for domestic tenancies governed by Part V of Cap. 7. To what extent, if at all, have these statutory entitlements to notice been affected by the Landlord and Teneant (Consolidation) (Amendment) Ordinance 1980 (No. 6 of 1980) which came into operation on February 15,1980?

5. It is clear from sections 1(2) and 3(b) of Ordinance No. 6 of 1980 and the recent decision of the Court of Appeal in Lam Wai V. Mak Yok-jan (Civ. App. No. 38 of 1980; April 2, 1980) that these premises were brought within the provisions of Part II of Cap. 7 on December 18, 1979 not withstanding the fact that proceedings to recover possession had commenced before the enactment of Ordinance No. 6 of 1980. (They were previously excluded from Part II because the occupation permit was not issued until November 1974). Although the amendment which takes out of the protection of Part V tenancies to which Part II now applies (ie. section 16 of Ordinance No. 6 of 1980) is not expressed to be retrospective, in my judgment it has that effect by necessary implication. Section 17(7) of Ordinance No. 6 of 1980, which invalidates "Part V" notices of termination served before December 18, 1979, is, in my judgment, a clear indication of the legislature's intention that all tenancies governed by Part II, including these which are the subject of pending proceedings, are to be governed by the new statutory provisions. The fact that in this case, the Plaintiff never served any notice under Part V cannot, in my view, alter this interpretation of the legislature's intention, although it might be relevant to a consideration of whether it would be "just and equitable" to make an order for possession. For these reasons, and having regard to other decisions dealing with similar disputes of this nature (see Remon v City of London Real Property Ltd. [1921] 1 K.B. 49; Hutchinson v Jauncey [1950] 1 K.B.574; Jonas v Rosenberg [1950] 2 K.B.52), the Plaintiff is not, in my view debarred from recovering possession by reason of her failure to give any written notice to the Defendant, and the rights of the respective parties are to be determined by reference to the law now in force. As a consequence of the provisions of section 5 of Ordinance No. 6 of 1980, the Plaintiff now has to prove not only that she requires the premises as a residence for herself, but that she reasonably so requires them. If the Plaintiff discharges that burden, the Defendant must satisfy the Court that in all the circumstances it would manifestly not be just and equitable to make an order for possession; it is no longer sufficient merely to show that greater hardship would result to the Defendant from making an order than would result to the Plaintiff from a refusal to make an order.

6. I turn now to the facts of this case, which are fortunately not seriously disputed, as both parties have, in my view, given truthful evidence on all important issues. The plaintiff is a single lady, now aged 57. Her parents are dead and she has no brothers or sisters. Until the summer of 1979 she worked as an amah. She acquired her interest in the premises in 1972 (before the building had been constructed) with the aid of a loan, which she has since repaid in full out of savings from her earnings and rentals from letting the premises after the issue of the occupation permit in November 1974. Due to continuing ill-health she gave up her work in August or September 1979, and with it, the living accommodation provided by her last employer. Since that time she has been staying with her aged aunt (Madam Tang Lai-chun) and the widow of a former "clansman" in limited accommodation. She says that since August or September she has frequently told the Defendant that she would require the premises for her own occupation at the end of the tenancy. The Defendant could not remember when the Plaintiff first declared her intention, beyond saying that she thinks it was not until November or December of 1979. Insofar as it may be material, I consider that the Plaintiff's recollection is probably more reliable on this aspect of the matter, She concedes that at a very late stage she did ask the Defendant whether she was willing to pay $2000 per month in order to remain in the premises, but asserts that she only did so in a state of desperation caused by the Defendant's declared intention to remain in the premises unless and until she received written notice or until the marriage of the Defendant, which she understood was to take place in March 1980. The Defendant says that this demand or suggestion for a new tenancy at $2000 per month was only made after she asserted her rights as to receiving written notice and reminded the Plaintiff that she could only increase the rent by 21%. But whenever it was made I am satisfied that the Plaintiff's suggestion was not intended to be taken seriously, and was motivated by her sense of despair and desire to give the Defendant some breathing (and living) space until her intended marriage in March of this year.

7. The Defendant is aged 35 and is a teacher in a kindergarten in Mongkok, earning $900 per month. She lives in the premises with her mother, who is aged 75 and has poor eyesight, and her younger sister, who is aged32 and is also a teacher in a private school, earning about the same salary. Although the Defendant intended to get married in March, she did not do so until May of this year. She was somewhat vague about her husband's job, but it seems that he is employed in a clerical capacity in the New Territories Administration at a salary of about $2000 per month. He lives with his elderly parents in a village house in Tsing Lung Tau. The Defendant stays there with her husband on Saturdays and Sundays. Although she says that the accommodation is very limited, comprising only two rooms, (which I accept) she was very frank and honest in admitting that she now stays in the suit premises on weekdays "for convenience", as it is closer to her place of work in Mongkok. She agrees that she told the Plaintiff that she would move out of the suit premises when she got married, but despite efforts to find alternative accommodation she has been unable to find anything suitable within the means of herself and her sister.

8. Having considered all the evidence, I am satisfied that the premises are reasonably required by the plaintiff for occupation as a residence for herself. The meaning of "reasonably required" was considered by the English Court of Appeal in Kennealy v. Dunne [1977] 1 QB 837 where Stephenson L.J. said (obiter at 844):

Whether the words "reasonably required", in what is now section 53(2)(b) of Cap. 7, should be given the same limited or less than completely objective interpretation they have received in the context of the English legislation, because the safeguards contained in the proviso to the Hong Kong statute are, or may be considered to be, substantially less protective to tenants than those in England, is a question on which I am reluctant to give any concluded opinion in the absence of the benefit of legal argument on both sides. The argument in favour of a more objective interpretation of the relevant words may be stronger in the case of a claim by a landlord (as in the present case) than in the case of a claim by a principal tenant (of proviso (ii) to section 53(2)(b)), but in the circumstances of the present case it it perhaps not proper or profitable for me to explore these possibilities or speculations further. Even if a more objective test should be applied, I am satisfied that the Plaintiff has discharged the burden imposed on her by the statute. Giving all due and proper regard to the undoubted hardship to the Defendant, and the other present occupants of the premises, the difficulties of finding suitable alternative accommodation, and having regard to the terms of the tenancy agreement and the conduct of the parties thereto, I do not consider that it can be said that the Plaintiff is behaving unreasonably in seeking to recover the premises for her own occupation. Although I have not heard any medical evidence to support her claim that she is no longer fir to continue her former occupation, it is surely not unreasonable for her to decide that the time has now come to retire and enjoy the fruits of her labours and her prudence in providing for her future by living in premises which she owns. Even if she proposes to share the premises with her aged aunt, a person outside the category of relatives mentioned in section 53(2)(b), I do not think that this would diminish the reasonableness or the genuineness of her present need for the premises as a residence for herself. (The statute contains fairly severe sanctions against the unauthorised assignment, sub-letting or parting with possession of premises recovered by order of the Court. See section 53(7) and (7B)).

9. For the reasons already stated, I do not consider that the demand or suggestion by the plaintiff that the Defendant might continue in occupation of the premises at a greatly entranced rental, weakens her case that she genuinely and reasonably requires the premises as a residence for herself. It should, perhaps, be placed in the Defendant's pan when balancing the scales of what is "just and equitable", but I do not think that it carries much weight.

10. For the sake of completeness, I do not think that any significance should be attached to the fact that the Plaintiff has accepted monthly payments of $630 made by the Defendant since January of this year. By arrangement between the parties, rent due during the existence of the tenancy was paid into the Plaintiff's bank account. Despite their differences, the parties have sensibly continued to use that convenient method of settling their respective financial obligations. To her considerable credit, the Defendant said in evidence that she did so, not as a result of any fresh agreement with the Plaintiff after the tenancy came to an end, but because she still lived in the premises and it was her duty to pay for that advantage. Accordingly, I do not consider that it can be said that, in the circumstances of this case, a new tenancy, from month to month, was thereby created by the conduct of the parties. Although the Defendant has understandably and rightly sought to rely upon her actual or supposed rights as to tenure of the premises, it is to her credit that, unlike some tenants, she has not sought to use these rights to justify a failure to pay what the law requiries her to pay for use and occupation of land pending the determination of the Court.

11. I now turn to the question whether the Defendant has shown that, in all the circumstances of the present case, it would manifestly not be just and equitable to grant possession of the premises to the Plaintiff. It would seem that the concept of what is just and equitable in the context of landlord and tenant relationships is unique to Hong Kong. Resort to a solution which is "just and equitable" can be found in legislation here and elsewhere dealing, inter alia, with the winding up of limited companies, contributions between joint-testfeasors (cf Daniel v. Rickett, Cockerell and Company [1938] 2 KB 322; Collins v. Hertfordshire C.C. [1947] KB 598) and the power to award costs to parties who are opposed by legally-aided litigants, (Cf. Davies v. Taylor (No. 2) [1974] A.C. 225.) These cases seem to suggest that the words confer upon a Court a fairly wide discretion. Applying that in the context of the Landlord and Tenant (consolidation) Ordinance, it seems to me that the defendant must show that it would be unfair or against conscience to make an order for possession. I do not think that the word "manifestly" adds anything substantial. In its ordinary sense it means "plainly" or "obviously". Would it be plainly or obviously unfair or unconscionable to make an order for possession in all the circumstances of this case? The Defendant may feel aggrieved by the fact that she was never given written notice of termination as was required by section 122 of Cap. 7, but I do not think that she can rely on this fact as a ground for saying that it would be manifestly unjust and inequitable to make an order for possession, when that protection has been expressly and, in my view, retrospectively taken away by the recent amendment, Even if it could be so relied on the facts of this case the Defendant has known since August or September 1979 that the Plaintiff intended to occupy the premises at the termination of the tenancy. By the time any order takes effect she will have had close to 12 months' notice of the Plaintiff's intention. In my view, the Defendant has failed to discharge the burden on her of showing that it would manifestly not be just and equitable to make an order in this case. Accordingly, there will be an order for possession, and a stay of execution until July 31, 1980.

Dated this 16th day of June, 1980.

Representation:

Plaintiff and Defendant in person.