Lee Ho Yuen v. Li Chi and Another
Read the full judgment text of DCCJ 2186/1980 on BabelCite. This District Court judgment.
1. The plaintiff seeks orders for possession against the defendants in respect of premises known as Flat M, 9th floor, Central Mansion, 527-539 Jaffe Road, Hong Kong together with mesne profits and other relief.
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DCCJ002186/1980 IN THE DISTRICT COURT OF HONG KONG HOLDEN AT VICTORIA CIVIL JURISDICTION ACTION NO. 2186 OF 1980 -----------------
----------------- Coram: H.H. Judge Cruden in Court. Date of Judgment: 20th June, 1980 ----------------- JUDGMENT ----------------- 1. The plaintiff seeks orders for possession against the defendants in respect of premises known as Flat M, 9th floor, Central Mansion, 527-539 Jaffe Road, Hong Kong together with mesne profits and other relief. 2. I am satisfied that Flat M comprises residential premises part of which are occupied by the 1st defendant and the remaining part of which are occupied by the 2nd defendant. Each defendant pays a monthly rent of $215. The defendants admitted that the premises are part of an entirely new building within the meaning of Section 3(1)(a) of Part I of the Landlord & Tenant (Consolidation) Ordinance, Cap. 7 in respect of which an Occupation Permit was issued by the Building Authority after the 16th day of August, 1945. It was common ground that since the 18th day of December, 1979 the premises have been subject to Part II of the Ordinance. 3. The premises were purchased by the plaintiff's mother in 1978 and thereupon assigned to the plaintiff by way of gift. The plaintiff's mother has since died. At the date of the assignment the premises were tenanted. I accept the plaintiff's evidence that his mother purchased the property and assigned it to him to provide a future home for the plaintiff and his fiancee when they married. I also accept that it is intended that the marriage will be solemnised in October 1980. The plaintiff stated that upon his marriage he personally wishes to live in the suit premises together with his wife and her parents. 4. At present he is sharing a room in a wooden hut being No. 48 Lo Wai Village, Tsuen Wan. He is a clerk who earns $2600 per month and he pays $150 per month for his present accommodation. The wooden hut also houses 30 to 40 other persons many of whom are recent arrivals from China. Photographs of the hut were produced and I accept that its cooking, toilet and other facilities are minimal. I find that it is not suitable accommodation for him and his fiancee after their marriage. The plaintiff's fiancee is also a clerk and receives $1500 per month. She lives with her parents in a flat in Wanchai of about 300 square feet. A total of eight persons live at her home, namely, her parents, her brother, her sister, her grandparents and herself. Those premises are not large enough to provide a home for also the plaintiff and his fiancee after their marriage. 5. The suit premises are approximately 500 square feet. At present they are subdivided into two separate living quarters. One of these is occupied by the 1st defendant and comprises about 300 square feet. The other, comprising about 200 square feet, is occupied by the 2nd defendant. 6. The plaintiff's claim is based on the recently amended provisions of Section 53 of the Landlord & Tenant (Consolidation) Ordinance, Cap. 7. Section 53 was substantially amended by Section 5 of the Landlord & Tenant (Consolidation) (Amendment) Ordinance, Ord. No. 6/80. The amendment was enacted on the 15th day of February, 1980, but by virtue of Section 1(2), was made retrospective to the 18th day of December 1979. As a result of the amendment Section 53(2)(b) now includes these provisions:-
7. A comparison of the amendment and the previous Section 53(2)(b) indicates that the earlier consideration of greater hardship has, as between landlord and tenant, been abolished and replaced by a new formula. Nevertheless greater hardship remains an express statutory consideration as between a principal tenant and a sub-tenant. However, as will be adverted to shortly, although greater hardship may no longer be an express statutory consideration, as between landlord and tenant, it may still, in many cases, be relevant. 8. The effect of the amendment is tolerably clear, but argument does exist as to the considerations that may properly be taken into account and as to the precise meaning of some of the new statutory provisions. Procedure 9. Proceedings under Section 53(2)(b) will, in most cases, procedurally involve two main steps:-
10. So far as evidence in respect of this first step is concerned, the Court is solely concerned with whether the plaintiff's wish to obtain possession for the prescribed residential purposes, is reasonable. At this stage the Court is not concerned with the position of existing tenants or their position in relation to the landlord. The tenant's circumstances and issues of what may be just and equitable as between landlord and tenant, do not at this stage arise.
The proviso, unfortunately, is negatively and awkwardly drafted.
11. Under the proviso, the tenant is therefore given the statutory opportunity to resist a claim for possession, even though the landlord may have already satisfied the Court that he reasonably requires the premises for himself or his statutory relatives. The nature of the obligation the defendant must discharge under the proviso varies, depending on whether he is a tenant or a sub-tenant:-
Again one may lament the negative drafting technique adopted.
12. In the instant case I am only concerned with the position as between landlord and tenant. No sub-tenancy exists. Substantive provisions 13. Turning to the substantive provisions, Counsel raised at least three matters to which I should properly refer:-
I will consider each of these matters in turn. The proper interpretation and status of the relatives named in Section 53(2)(b) 14. The defendants Counsel pointed out that the statutory list of a landlord's relatives does not include fiancee, father-in-law or mother-in-law. Therefore, it was submitted, that I should not take these persons into account in considering the plaintiff's circumstances, as they were not relatives contemplated by the legislature. In Dawson v. United States Lines Inc. V.C.J. No. 1260 of 1980 I had to consider this same issue when I held that the categories of relatives mentioned in Section 53 are to be construed disjunctively. Any misconceptions should disappear, if the Section is approached on this basis. 15. It is axiomatic that where a tenant is in possession and there is a dispute between landlord and tenant as to possession, the only party who can bring an action for possession is the landlord. The Section then goes on to provide that, so far as the landlord is concerned, the premises must be required "for occupation as a residence for himself, his father, his mother or any son or daughter of his over the age of 18". 16. In my view these words mean that a landlord may successfully bring an action - subject of course to a tenant's rights under the proviso - to obtain possession of the premises as a residence for either:
17. Only in the first case if he wishes to obtain the premises for himself - is it necessary for him to reside personally in the premises. The Section thus enables a landlord who is already adequately housed and who could not show that he required the premises for his own personal residence, nevertheless to obtain possession so that the premises may be used for the personal residence of any of the relatives listed from (ii) to (v). This is not only the literal construction of the Section; it is the natural construction of those words in the context of the Section. The reference to sons and daughters over the age of 18 would be meaningless if the Section were to be otherwise construed. Conversely, if it were to be otherwise construed, why is there no reference to a landlord's wife or infant children but only to other relatives who, prima facie, are less dependent on him? That fact alone is fatal to the interpretation put forward by Counsel for the defendants. The Section therefore enables a father, already adequately housed, to obtain possession of other property of which he may be landlord, not for his own use, but for the residential purposes of, for example, a son or daughter over the age of 18. That son or daughter may then reside at the recovered property quite separately and independently of the father. So also in the case of a landlord's parents. On the other hand, where the ground for possession is that the landlord wants the premises for his personal residence, the list of statutory relatives in no way restricts the Court from taking into account the wider or different relationships of persons comprising his family or his household. The limited list of statutory relative becomes wholly irrelevant. For where the landlord wants possession for his own residential purposes it is proper to look at his actual family and household who will live with him. His family will usually include his wife and children. His family may include his father-in-law and mother-in-law. His household may include non-relatives such as a live-in amah. In considering his circumstances no categories of persons are, as a matter of law, excluded. The only factor for the Court to consider is whether those persons are in fact members of his family or household whose presence should reasonably be taken into account. The more remote the relationship the more suspiciously a Court may look at the evidence in determining whether such persons are in fact members of a landlord's family. Similarly, a claim that his household genuinely and reasonably includes one servant may be more readily accepted than a claim that his personal requirements include sufficient living space to provide for a large number of live-in servants. A Court would ever be alert to prevent an opportunist landlord from falsely strengthening his claim by artificially increasing the size of his family or household. 18. In my view, the statutory provision relating to relatives is crystal clear. I have only dwelt with this matter at such length because in this case and in other recent cases, the contrary view has been so strongly argued. "Just and equitable" 19. In so far as disputes between landlord and tenant are concerned the old test of greater hardship has been replaced by the words "just and equitable". What precisely do these new words mean? Do they include, within their terms, the old concept of greater hardship or are they concerned with narrower or different considerations? 20. The words must, of course, be construed in their context. The Court is directed by Section 53 to look at "all the circumstances of the case" in deciding whether it would manifestly not be just and equitable to grant possession to the landlord. So it is a question of what is just and equitable in all the circumstances. 21. "Just and equitable" is a commonly used legislative phrase. Historically, it has often been used in amending statutes where the legislature has sought to lessen the rigours of the previous law and allow practical rather than technical considerations to be taken into account. Historically too, the words have been employed to give the Court a discretion where none existed before or to widen a pre-existing narrower discretion. 22. To date there are no Hong Kong decisions binding upon me as to the meaning of these words in the context of the amended Section 53. In the absence of such authority I have found it helpful to consider, by way of analogy, the judgment in Daniel v. Rickett, Cockerell & Co. Ltd. v. Raymond (1938) 2 K.B. 322 where, in analysing the same words, but in respect of quite different statutory provisions, namely the Law Reform (Married Women and Tortfeasors) Act 1935, Hilberry J., said:-
23. Similarly under the proviso to Section 53(2)(b) I am satisfied that the words "just and equitable" create a judicial discretion whether to refuse to make an order in favour of the landlord even though he has established that the premises are reasonably required by him. In the exercise of that judicial discretion the Court has to do what it thinks is right between landlord and tenant having regard, as Section 53 directs, to "all the circumstances of the case". 24. Those circumstances must, of course, be relevant circumstances. It would be undesirable to attempt to list comprehensively the categories of relevant circumstances and I certainly do not propose to attempt to do so. No doubt, like the categories of negligence, they too, will never close. However, they will at least include circumstance personal to the landlord, to the tenant and relevant to the premises. For example, the size and nature of their families and households; their financial position; the size and nature of their existing premises; the alternative accommodation, if any, available for the parties and, if so, its suitability. The comparative hardship of the parties will often be a very relevant circumstance for a Court to take into account before exercising its newly created judicial discretion. 25. I am satisfied that the words "just and equitable" are far wider than the former test of greater hardship. They are certainly wide enough to include greater hardship. Whereas hardship was earlier an express and in practice usually the decisive criteria, it is now but one of the matters that may have to be considered. In coming to a decision of what is just and equitable, greater hardship on the part of one party may, of course, be outweighed by other factors which also fall under the wider umbrella of the just and equitable formula. On the other hand, greater hardship, in many cases, will be the decisive factor in determining whether it would be just and equitable to make an order. "Manifestly" 26. The onus on the tenant under the proviso is not merely to satisfy the Court that it would not be just and equitable to grant a landlord possession, but that it would "manifestly" not be just and equitable to do so. Again there are, as yet, no reported decisions on the effect of the use of the word "manifestly". However I am satisfied that the use of the word "manifestly" increases the tenant's task. "Manifestly" is defined in Volume 6 'Oxford English Dictionary' (1961 Edition) at page 123 as follows:-
27. At page 122 a series of definitions of "manifest" in its different senses is given. The relevant definitions for present purposes are:
28. Therefore, on the basis of these dictionary meanings the tenant would have to do more than just satisfy the Court that it would not be just and equitable to make an order. The tenant would have to go further and show that it would plainly, obviously and unmistakably not be just and equitable to make an order for possession. In other words, the inclusion of the word "manifestly" increases the burden on a tenant compared with the position if the Section did not include that word. 29. While there are no reported decisions on the meaning of "manifestly" for the purposes of Section 53, the same word was used in the originally controversial provisions of Section 81A of the Criminal Procedure Ordinance Cap. 221. Section 81A empowers the Attorney General to apply to review any sentence on the grounds, inter alia, that it is manifestly excessive or manifestly inadequate. Section 81A was enacted in 1972 and in the same year was considered by the Full Court in Re Applications for Review of Sentences (1972) H.K.L.R. 370. Section 81A is an entirely different statutory provision and deals with a matter of the criminal law, but in the absence of other judicial authority, it does assist in considering the meaning of the word "manifestly" in Section 53. The Full Court, by a majority, held that the inclusion of the word "manifestly" created a substantial distinction between the burden on an accused appealing against sentence and the burden on the Attorney General applying under S.81A for a review of sentence. Under Section 81A, in the words of the Chief Justice:
30. These words support the view that under Section 53 it is not merely sufficient if the defendant satisfied the Court that it would not be just and equitable to make an order for possession against him. By analogy with the decisions on Section 81A, he is subject to a far more stringent test. He must satisfy the Court not merely that it would not be just and equitable but that plainly and unmistakably, it would not be just and equitable. Certainly this is more stringent standard but it still falls far short of the extremely onerous standard urged by Counsel for the plaintiff. 31. Counsel for the plaintiff submitted that the use of the word "manifestly" makes it nearly impossible in most cases for a tenant to discharge the increased burden under Section 53. I do not think the new legislation quite amounts to such a landlords charter. Certainly I reject the submission that a tenant would only be able to succeed under the proviso in rare and exceptional cases. Each case, of course, depends on its own facts. Section 53 does not place an exceptionally high burden on a defendant. It simply means that, where the landlord has discharged his primary burden, a Court should not refuse the landlord has discharged his primary burden, a Court should not refuse the landlord an order for possession, unless the tenant plainly establishes that it would not be just or equitable to do so. 32. In other words before refusing to make an order, the Court must be satisfied, on the balance of probabilities, that it would plainly, not be just and equitable to make an order in favour of the landlord. Given the social and economic pressures in the field of residential housing in Hong Kong, it is not difficult to envisage a great many cases where a tenant would have little difficulty in discharging that burden. 33. As a factual example of where a tenant successfully discharged that burden I was referred by Counsel for the defendant to the recent decision of Tang Wai Chi v. Ng Fat Shing V.C.J. No. 5998 of 1979. In that case, which I have found of considerable help, Jones, D.J., followed the same interpretation of Section 53 as I have adopted in this case. On the unexceptional facts of that case he had no difficulty in holding that the defendant tenant had discharged the onus under the proviso. The action by the landlord for possession was accordingly dismissed. The factual circumstances of the parties 34. The remaining question is, have the defendants, or either of them, discharged the burden which is placed on them under the proviso? On this issue I have already held that it is necessary for the Court to consider all the relevant circumstances before judicially exercising the discretion invested in it by the just and equitable provisions. 35. So far as the plaintiff is concerned, he pleads in paragraph 7 of the statement of claim that he requires the premises "for occupation as residence for himself." I have already held that he does reasonably require the premises for that purpose. In coming to that conclusion I have had regard to the extent of his household. I have accepted that he intends to marry his fiancee in October 1980. Even though he is not yet married, his intention to marry in a few months time is an existing circumstance I am entitled to take into account. I am therefore satisfied that he does require the suit premises, as a home, for himself and his wife. I also accept that his wife's parents would then also live with him at the suit premises. As a matter of law, I am satisfied that I am entitled to take the intention that they will live with their daughter and son-in-law into account. In that event the plaintiff's household would comprise 4 adult persons. However, it will be a separate question for me to decide on the facts, the weight that should be given to the position of the parents, as part of the plaintiff's household, when I come to compare his position with the defendants respective positions. 36. The 1st defendant is the head of a family which pools its joint income for family expenses. He is 60 years of age and is self-employed as a stamp vendor from a street stall. This small business is apparently not profitable. The 1st defendant did not give evidence but his elder daughter gave evidence as to his family circumstances. His wife is proprietor of a congee stall which she has operated for more than 10 years. The monthly income from the stall is merely $400. This evidence was attacked by the plaintiff as not being credible. Also living with the 1st plaintiff are his three sons aged 28, 27 and 22 who respectively earn $1000, $1200 and $1500 per month. The elder daughter has not worked for several months and proposes to marry next December when she would leave the suit premises to live elsewhere. When she did work her monthly income was $1500. The younger daughter, aged 20 years, is in Form 6 at secondary school and is at present sitting university entrance examinations. It is hoped that she will proceed to university where, in addition to any scholarship, bursary or other grant, she will need the financial support of her family. After pooling their income the 1st defendant's family has in recent months been paying $800 per month to the wife of the 1st defendant's younger brother, who recently arrived in Hong Kong with her son, from China and is not yet self-supporting. A further $300 is remitted each month to China for the 1st defendant's younger brother. The 1st defendant's elder daughter stated that the family have tried to obtain alternative accommodation but are unable to find any at a rental they can afford. No details of any such efforts or of other rentals were given. 37. The 2nd defendant is employed by the Hong Kong Government. He produced documentary evidence that he receives a monthly salary of $1225. He is aged 58. Living at the suit premises with him are his wife aged 47, his son aged 17 and his father-in-law, aged 77 years. There were produced in evidence several medical reports relating to the 2nd defendant's wife which indicated that in addition to other ailments she has been attending the Hong Kong Psychiatric Centre in respect of suspected anxiety depression. Her father, as well as being aged, is partially blind and can only go out by himself with difficulty. I was told little about the son. On the evidence the whole of the 2nd defendant's household is supported by his sole income. 38. The 2nd defendant, who personally gave evidence, stated that in 1979 he applied to the Housing Authority for public housing. He further stated that he will leave the suit premises if he is allocated public housing. There are no indications of whether his application will be granted or, if it were, when such accommodation might be available. There is at present no other accommodation available to him which he can afford. 39. When I compare the position of the 2nd defendant with the plaintiff there is an obvious financial disparity. The plaintiff earns $2500 per month plus a further $430 per month by way of gross rents from the suit premises. On that income he merely has to support himself. His fiancee earns $1500. On marriage, their joint incomes - leaving aside any rental income - will be $4000 per month. They are and will be in a very much better financial position than the 2nd defendant who has to support a household of 4 persons, one of whom is under medical treatment, on a monthly salary of $1225. In so far as the plaintiff's prospective father-in-law and mother-in-law are concerned, their present accommodation is not inferior to the present accommodation of the 2nd defendant's household. If an order is not made, the father-in-law and mother-in-law's existing accommodation will continue to be available for them. On the other hand, if I were to make an order against the 2nd defendant the four persons of his household would be made homeless. I recognize that if no order is made that the plaintiff and his fiancee would then have to obtain accommodation elsewhere. This would obviously cause them inconvenience but they would have the financial capacity to find other accommodation. As between the parties. the 2nd defendant's household would plainly suffer greater hardship than the plaintiff's household. 40. After taking all these circumstances into account I am well satisfied, on the balance of probabilities, that it would manifestly not be just and equitable to make an order for possession against the 2nd defendant. The action against him is therefore dismissed. 41. This leaves the position of the 1st defendant to be determined. The relevant position of the parties here is more complicated. I accept that if an order is made in favour of one party the other will suffer hardship. The area of the suit premises occupied by the 1st defendant would adequately meet the reasonable requirements of the plaintiff and his household of 4 adult persons. When the 1st defendant's elder daughter leaves to be married his household will comprise 6 persons. Financially the position of the plaintiff is also stronger than the 1st defendant's but the disparity is very much less than in respect of the 2nd defendant. I agree that the 1st defendant's wife's stated income seems very modest for a congee stall proprietor who has carried on business for more than 10 years. Unfortunately she did not give evidence. If her actual income is higher then that would narrow the financial difference between the parties. I also take into account that out of their existing income the 1st defendant's family already pays a total of $1100 per month to the 1st defendant's younger brother or his family. The latter payment must surely substantially reduce when the younger brother's wife and son are better established in Hong Kong. Neither party is in dire financial circumstances. In any event financial considerations while relevant are not by themselves decisive. 42. The evidence of the 1st defendant's effort to find alternative accommodation was vague in the extreme. There is no cogent evidence of any real efforts having been made. I have also taken into account that the 1st defendant's street stall is in a street nearby the suit premises which, because of his age, makes for convenience. I also accept the medical evidence that it is desirable that he avoid prolonged standing and walking. However, his business is not profitable so there seems to be no compelling need for him to live in this precise locality. I recognize that his wife's congee stall is also nearby but again there is no evidence, apart from grounds of convenience, which makes it essential for her to live nearby. Here there are no young children enrolled or settled at schools in the same locality whose education might be upset if they had to move. To sum up, there are no substantial reasons which make it necessary for the 1st defendant to obtain alternative accommodation only in Wanchai or a nearby locality. 43. After taking all these relevant circumstances into account, I have also reminded myself of the burden of proof placed on the 1st defendant under the proviso. Having done so, I am not satisfied that, it would manifestly not be just and equitable to grant the plaintiff the order for possession he seeks. Having made that finding, it therefore follows that there will be judgment for possession in favour of the plaintiff against the 1st defendant. 44. Counsel wanted to be heard on the question of costs. I will hear them further on that issue and also on the question of mesne profits, stay and any other consequential matters, for which purposes leave to apply is hereby reserved. 45. Dated this 20th day of June, 1980.
Representation: Miss C. Remedios instructed by W.I. Cheung & Co. for the plaintiff. Mr. Paul Chan of Edmund Chow & Co. for the 1st and 2nd defendants. |