Avant Investment (F.E.) Ltd v. Po Ping Medicine Co(A Firm) and Another

DCCJ005001/1981

Landlord and Tenant - consolidated actions under section 53(2)(c) of Landlord and Tenant (Consolidation) Ordinance, Cap. 7, where landlord intends to rebuild property involving domestic and business premises - whether District Court has jurisdiction to hear actions which attract rateable value over the limit of $15,000.00 imposed by law on District Court on recovery of land - Held: District Court is not fettered by the financial limitation of Section 35 of the District Court Ordinance, Cap. 336 in respect of actions on recovery of land for re-development purposes and has jurisdiction to hear cases involving premises with more than $15,000.00 in rateable value.

IN THE DISTRICT COURT OF HONG KONG

HOLDEN AT VICTORIA

CIVIL JURISDICTION

ACTION NO.5001 OF 1981

______________________________

______________________________

Coram: H. Wong, D.J.

Date: 5 May 1982

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RULING

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1. At the hearing of the 12 consolidated actions VCJ Nos. 4994/4995, 4997, 4998/5001 and 5003/5007 of 1981 relating to a re-development of real estate property, the issues of which were identical, Plaintiff landlord succeeded in reaching a settlement for posssession of premises involved with all defendant tenants except those in Action VCJ 5001. The outstanding case concerns the premises known as No. 10 Pennington Street, ground floor including cockloft, (hereinafter referred to as "the suit premises") which are being occupied by Po Ping On Medicine Company (1st defendant) and Mr. LIP Chi-ching (2nd defendant) and which attract, as the parties had agreed, a rateable value of $24,000.00.

2. It is not disputed that :-

3. As far as Plaintiff and 1st defendant are concerned, their pleadings show they were in agreement that the suit premises were 1et to 1st defendant for non-dwelling purposes on a monthly tenancy basis, that no key or construction money or the like had been paid by 1st defendant to Plaintiff or its predecessor in title and that Parts II and IV of the Ordinance consequently did not apply. However clauses in the Particulars of claim dealing with :-

4. At the beginning of the hearing Mr. B. Yu, for 1st defendant, applied for leave to raise an issue on jurisdiction which was not featured in the defence. That application was granted under Order 18/8/7 of Rules of Supreme Court (Volume 1 page 310). It was Mr. Yu's contention that Action VCJ 5001 ought to be heard by the High Court on the ground that the rateable value of the suit premises exceeded the limit of $15,000.00 imposed on the District Court under section 35 of the District Court Ordinance, Cap. 336 for cases connected with land, whereas Mr.R. Wong, for Plaintiff, maintained that the District Court was a competent forum for this purpose. It is therefore incumbent on me to decide on this preliminary issue of law. I would add that it is not open to one party or both parties to consent to submit to jurisdiction, so as to confer on the Court a jurisdiction to deal with matters which are beyond its powers.

5. During the proceedings and after some negotiations Plaintiff and 2nd defendant came to a written compromise but made it conditional upon the ruling that the District Court had jurisdiction to hear the case.

6. Apart from the above issue Mr. Yu further alluded to an additional matter and that is, since 1st defendant had denied Plaintiff's claim on notice to quit (paragraph 6 of Particulars of Claim) the repealing clause 14 of the said Amendment No. 52/81 had no application to the present case. That clause 14 says :

7. For clarity's sake, the relevant subsections of the repealed section 125 of Landlord & Tenant (Consolidation) Ordinance are reproduced below :-

8. Mr. Yu thus submitted that, if the District Court had jurisdiction, Plaintiff should, for lack of notice, nevertheless, be bound by but had not complied with Section 122, as amended by Section 12 of the Ordinance of 52/81. The amended Section 122 reads :-

9. He put emphasis on those dates and advanced the following arguments :-

10. Mr. Wong also cited "WONG Hau-yuen and others v. Tai Fong Tea House Ltd."(1963) HKLR page 197, an appeal by way of case stated following a District judge's decision that he had no jurisdiction in dealing with a claim for possession of premises 1et at a rent of $5,000.00 per month. Hogan, C.J. President of the Court of Appeal stated at page 199.

"This is a question of law, submitted to us under section 34 of the Supreme Court (Summary Jurisdiction) Ordinance, Cap. 5, as applied to the District Court. The question is whether the Judge was right in holding that section 7 of the Tenancy (Notice of Termination) Ordinance 1962, as amended, did not confer on the District Court jurisdiction to deal with applications respecting premises, the annual value of which exceeded $5,000. The relevant parts of the section read as follows :

"7.   (1) Notwithstanding the provisions of this Ordinance where a notice to quit contains a statement of the intention of the landlord to rebuild the premises to which such notice relates it may give such period of notice as could have been given but for the enactment of this Ordinance.

(2) .................................................

(3) Where the landlord has served notice to quit under sub-section (1) he may apply to the District Court for an order for possession of the premises comprised in the tenancy and in any sub-tenancies affected under subsection (2) to take effect on the expiry of such notice. The Court may make such order where it is satisfied that the landlord intends to rebuild and is capable of so doing."

and at page 201 "For my part, I am satisfied that the jurisdiction derived from paragraph 1 of the First Schedule to the District Court Ordinance is a separate and distinct jurisdiction and that, although it may provide the principal or major division of the District Court's jurisdiction in regard to land, there is nothing in the District Court Ordinance to indicate that where a further jurisdiction is conferred on the District Court by another ordinance dealing with land, the latter jurisdiction must be regarded as subject to the same pecuniary limitations as are contained in section 5 of Cap. 5, unless some words are inserted into the Ordinance conferring the additional jurisdiction for the purpose of excluding these pecuniary limits. To my mind the pecuniary limits contained in Section 5 of Cap. 5 are peculiar and particular to the jurisdiction derived from that section and do not apply to other categories of jurisdiction unless specifically or by implication introduced into them. I see no reason to introduce them into the jurisdiction conferred by section 7 of the Tenancy (Notice of Termination) Ordinance. Huggins, J. (as he then was) agreed with the views of Hogan, C.J. and added at page 206 "The legislature has said that the landlord may apply to the District Court for an order for possession and I can see no sufficient ground for holding that the legislature did not mean precisely what it said. " The Supreme Court (summary Jurisdiction) Ordinance, Cap. 5, Section 5 which had been repealed, reads :-

"It shall be lawful for the Supreme Court to exercise a summary jurisdiction at law in all actions where the claim, debt, or damages sought to be recovered does or do not exceed the sum of $5,000.00, and in all actions for the recovery of the possession of the tenements where the annual rent or value thereof does not exceed that amount".

11. The District Court was established in 1953 and Section 14 of District Court Ordinance of that year gave to the new court the civil jurisdiction described in the Schedule, including Section 5 of Cap. 5. The result was that the appeal was allowed by a majority. WONG Hau-yuen's case was returned to the District Court with an intimation that it had jurisdiction.

12. It can be seen that (a) Section 125 of Landlord & Tenant (Consolidation) Ordinance is identical to Section 7 of the Tenancy (Notice of Termination) Ordinance, as mentioned in WONG Hau-yuen's case, with the exception that the word "Part" (meaning Part IV) of Section 125(1) was substituted for the word "Ordinance" in the corresponding Section 7(1). (b) Section 5 of the Supreme Court (Summary Jurisdiction) Ordinance, Cap. 5, used in WONG Hau-yuen's case, was replaced by Section 35 of District Court Ordinance, which says :

"Subject to the provisions of Part I of the Landlord & Tenant (Consolidation) Ordinance, the Court (meaning District Court) shall have jurisdiction to hear and determine any action for the recovery of land where the annual rent or the rateable value, determined in accordance with the provisions of the Rating Ordinance, or the annual value of the land, whichever is the least, does not exceed $15,000.00"

13. It was conceded by Mr. Yu that if notice to quit was proved by Plaintiff as claimed, i.e. that it was a month's notice for 1st defendant's monthly tenancy and effected before the operation of the Amendment No. 52/81 of 10th July 1981, then such notice would be regulated by section 125(1) and therefore valid. Here I concur with Mr. Yu that for the purpose of Section 125(1), which introduces an exception to the requirement of 6 months' notice, Plaintiff could serve a notice of shorter duration than that requirement. Be that as it may, the question of notice is a matter of evidence which should be dealt with at the hearing.

14. From the arguments put forth by counsel I agree with the views expressed by Mr. Wong, for Plaintiff, that the repealing section 14 of the Amendment No. 52/81 pr cisely denotes what it says, viz., that it abolished Section 125 of the principal Ordinance but at the same time qualified that the repeal did not alter cases of which notice to quit had been served before the effective date, i.e., 10th July 1981. Consequently, on the assumption that Plaintiff had served notice dated 27th May 1981 on 1st defendant to quit on 30th June 1981, Section 125 would be applicable to the present case.

15. I also take heart in the decision of "Cheng Pui Wah trading as Wah Nam Knitting Factory & others v. Luen Hup Chi Yip Ltd. & others" (1964) H.K.L.R. page 19 which followed the findings of WONG Hau-yuen's case and is at all fours with the instant case. In the first-mentioned case, Cheng Pui Wah was the appellant (defendant) and Luen Hup Chi Yip was respondent (plaintiff). Its headnote reads :-

"The respondents were the landlords of valuable property not subject to control under the Landlord and Tenant Ordinance, Cap. 255. Notices to quit had been served on the tenants of the property under section 7 of the Tenancy (Notice of Termination) Ordinance 1962, which notices contained a statement that the respondents intended to rebuild. The majority of the tenants consented to judgment but the appellants resisted the claim for possession in the District Court on the ground that the annual value of each of the premises occupied by the appellants exceeded the limit of $5,000 imposed by section 5 of Cap. 5, and was therefore in excess of the jurisdiction of that court.

They also put the landlords to proof of their intention and ability to rebuild.

The District Court found in favour of the landlords and the appellants appealed.

Section 7(3) of the Tenancy (Notice of Termination) Ordinance 1962 provides :-

"Where the landlord has served notice to quit under sub-section (1) he may apply to the District Court for an order for possession of the premises comprised in the tenancy ....... to take effect on the expiry of such notice. The Court may make such order where it is satisfied that the landlord intends to rebuild and is capable of so doing"

On the appeal it was argued, in addition to the point of lack of jurisdiction of the District Court, that the onus was on the landlords to prove that they had a fixed, irrevocable intention to rebuild at the time of giving notice, that such intention continued up to the hearing, and remained unalterable except in some special or unforeseen circumstances.

Held: 1. The jurisdiction of the District Court under the Tenancy (Notice of Termination) Ordinance, section 7, was not limited to $5,000, Wong Hau Yuen v. Tai Fong Tea House Ltd., 1963 H.K.L.R. 197 followed:"

16. At page 35 Blair Kerr, J. (President) said :"In my view section 7 introduced an entirely new type of proceeding. I do not think it is necessary on this appeal to express a view on whether the District Court has been given exclusive jurisdiction by the section; but it has certainly been given a new jurisdiction, and it is a new jurisdiction which is not subject to the provisions of section 5 of Cap. 5." (The said sections have been referred in the preceding paragraphs viz., Section 7. Tenancy (Notice of Termination) Ordinance 1962 is the equivalent of Section 125 of Land-lord & Tenant (Consolidation) Ordinance and section 5 of Cap. 5 was in respect of the limit of jurisdiction of District Court of $5,000.00). Blair Kerr, J went on saying that he entirely agreed with the views of Hogan, C.J. in WONG Hau-yuen's case and added "it was never intended that the new jurisdiction conferred on the District Court by Section 7 should be regarded in some way or other as being subject to the pecuniary limits contained in Section 5 of Cap. 5".

17. In the light of the foregoing I adopt the views expressed in WONG Hau-yuen's case and am reinforced in my findings by the later and similar decision of CHENG Pui-wah's case.

18. I would add that, in my opinion, it is not the intention of the legislature that there should be a multiplicity of proceedings if different floors of a building, which attract diverse rateable values, should be the subjects of applications to the High Court and the District Court on account of those values to the inconvenience and expense of litigants.

19. In the final analysis, I hold that the District Court is not fettered by the restrictive provision of Section 35 of the District Court Ordinance in respect of action on recovery of land for re-development purposes and rule that the District Court has jurisdiction to hear Action VCJ 5001/81.

Representation:

Mr. R. Wong, instructed by James Y.H. Fu & Co. for Plaintiff

Mr. B. Yu, instructed by Woo & Woo for Defendant