Lee Tai on v. Sk Mahtani

LDLA010378/1982

Headnote

Landlord & Tenant - claim for possession of premises under section 53(2)(b) of Landlord and Tenant (Consolidation) Ordinance (Cap 7) - premises owned by plaintiff and his mother - written tenancy agreement entered into by plaintiff as landlord - premises reasonably required by plaintiff as a residence for himself, but not so required by mother - whether mother also landlord.

Held: plaintiff entered into tenancy agreement on his own behalf and as agent for mother; both, therefore, were "landlords" for the purposes of section 53(2)(b); claim dismissed. Allied International Insurance Ltd v Hsia Jone Shu & another (Civ. App. No. 81 of 1981) and Epps v Rothnie[1945] KB 562 applied. Stratford v Syrett [1958] 1QB 107 distinguished.

Dates of Hearing: 30th December 1982; 29th March 1983

Date of Judgments: 15th April 1983

IN THE LANDS TRIBUNAL OF HONG KONG

HOLDEN AT KOWLOON

ACTION NO. KCJ 10378 OF 1982

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Coram: Presiding Officer Judge Downey

Date: 15th April 1983

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JUDGMENT

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1. At first sight, this case appeared to be a simple and straightforward claim to recover possession of domestic premises under section 53(2)(b) of the Landlord and Tenant (Consolidation) Ordinance (Cap 7). However, as a result of matters which have been revealed, or have emerged, since the formal commencement of the present proceedings, it poses important and difficult questions of law.

2. On the 5th July 1982 the plaintiff issued a writ claiming possession of Flat B1, on the 13th floor of Tsimshatsui Mansion, 87 Nathan Road, Kowloon ("the premises"). In paragraph 1 of the Particulars of Claim it was alleged that the plaintiff was the registered owner of the premises. Paragraph 3 alleged that the plaintiff let the premises to the defendant for a term of two years under a tenancy agreement dated the 19th June 1980 (Exh. P. 3). When the case come on for trial before me on the 30th December 1982, one of the exhibits produced by the plaintiff's solicitor - the Lard Registry Record - showed that there were two registered owners, viz., the plaintiff and one Koo Chu Ying, as had been alleged by paragraph 1 of the Defence filed on the 16th July 1982. I drew attention to the decision of the Court of Appeal in Allied International Insurance Ltd v. Hsia Jone Shu and another (Civil Appeal No. 81 of 1981; 8th January 1982), whereupon the plaintiff's solicitor sought, and obtained, an adjournment to consider what, if any, further action was necessary. The resumed hearing took place on the 29th March 1983. No amendment of the writ or pleadings was sought. Although the Land Registry Record, which had been returned to the plaintiff's solicitors in December 1982, was not re-produced, the further hearing proceeded on the basis that the plaintiff was one of two registered owners, the other being his mother.

3. At the further hearing, the plaintiff produced two tenancy agreements. The first was dated the 20th February 1977, and was for a period of two years (Exh. P. 1). The second was dated the 19th June 1980, and was for a period of two years (Exh. P. 3). The defendant also produced a letter, dated the 19th May 1980 (Exh. D. 1), from solicitors then acting for the plaintiff and his mother as the owners of the premises, and a draft lease (Exh. D. 2), which named the plaintiff and his mother as "the Landlord". The plaintiff's mother was not a party to the two tenancy agreements (Exhibits Pi and P3). They were made between the plaintiff, who was described therein as "the Landlord", and the defendant as the tenant.

4. Mr. Chain contended that, assuming he had proved that he reasonably required the premises as a residence for himself, the plaintiff was entitled to an order, notwithstanding that his mother had not, and could not, show that she reasonably required them as a residence for herself, because he was "the Landlord" by virtue of the contracts of tenancy alternatively by virtue of the doctrine of estoppel, and within the statutory definition of "Landlord" in section 49 of Cap 7.

5. Mr. Hoosenally submitted that the plaintiff and his mother constituted" the landlord" for the purposes of the legislation, and, as the mother did not need the premises, no order could be made in favour of the plaintiff, even if he had proved that he reasonably required the premises as a residence. He contended that the legislation was designed to enable the registered owner or owners to recover their premises and, if one of several joint owners were allowed to recover possession simply because that joint-owner had alone entered into the tenancy agreement, unjust and capricious results would flow from this device to avoid the effects of Allied International Insurance Ltd v. Hsia Jone Shu and another, supra. What, he asked, are we to make of cases in the past where one joint owner has been refused an order for possession because the other owner(s) cannot establish a genuine present need for the premises?

6. I my view, the short answer to Mr. Hoosenally's rhetorical question is that it does not appear, from the facts of any of the decided cases, in England or Hong Kong dealing with premises owned by two or more persons, that the tenancy agreement was entered into by only one of the several owners, with the possible exception of Stratford v. Syrett[1958] 1QB 107, on which Mr. Chain relied, and to which I must return. In this respect, the facts of the case now before me may be sufficiently different to enable me to distinguish authorities which are otherwise clearly binding upon me.

7. Secondly, although it is clear that the question now before me goes to my statutory jurisdiction to make the order sought and the Parties cannot confer upon me, by agreement or estoppel, a jurisdiction which I do not possess, there is nothing to prevent me from giving effect to a legal "device" which the parties, or their legal advisers, may discover or stumble upon, as a means of avoiding the impact or particular consequences of the legislation or decided cases, so long as it would not be contrary to the policy of the legislation, or otherwise contrary to public policy and I am not misled into disregarding authorities binding upon me.

8. On the evidence before me, I think that the plaintiff has just proved that he reasonably requires the premises as a residence for himself. Although his mother has not given evidence, I think that I am entitled to infer that she consents to these proceedings and to the proposed future use of the premises, i.e. as a residence for the plaintiff and his wife as well as the plaintiff's younger brother and his wife. For my part, I do not think that it would be plainly contrary to the policy of the legislation to make an order for possession of premises where both owners can wring themselves within section 53(2)(b), albeit not within the same sub-paragraph. If the fact that, in this case, the tenancy was entered into by only one of the joint owners, is a material distinguishing feature, I do not think that an order in favour of the plaintiff would be in conflict with Allied International Insurance Ltd v Hsia Jone Shu and another, supra, or Wetherall v Stone [1950] 2 All E. R. 1209. The real and only question is whether this factual difference entitles me to distinguish these authorities.

9. Mr. Chain's argument can only succeed on the basis that there is only one landlord, i.e. the plaintiff. The authorities he relied on certainly support the proposition that the plaintiff is a "land- lord" for the purpose of these proceedings. Cf Stratford v Syrett [1958] 1 QB 107; Shek Yee-wan v Leung Mui [1982] HKLR 327. But, in my view, they do not support the further proposition that he is the only landlord. Shek Yee-wan v Leung Mui was decided on the definition of "landlord" found in section 49 of Cap 7 That statutory definition is not exclusive or exhaustive. Employment of the word "includes" suggests that tae stipulated meaning expressed in the definition is incomplete. It may extend or enlarge the ordinary meaning of the word defined. But, I do not think that it necessarily excludes the ordinary, popular, and natural meaning of the word. According to the latter meaning, and on the basis of the facts of this case, I consider that the plaintiff's mother may also be considered to be the "landlord". Indeed, this is what Mr. Hoosenally contended. He did not seek to deny that the plaintiff was the defendant's landlord. He merely contended that the plaintiff's mother should also be treated as his client's landlord.

10. The main prop of fir Chain's argument is to be found in the decision of the English Court of Appeal in Stratfordv. Syrett, supra. In that case, the premises had been left by will to trustees for sale for the plaintiff for life and, on her death, to her daughter absolutely. The trustees allowed the plaintiff to deal with the premises as she wished. She let the defendant into possession of the premises under an oral weekly tenancy, and he remained in possession for some 18 years, paying the rent to the plaintiff, who was entitled to the rents and profits. The plaintiff having established that she required the premises for her daughter, and having succeeded on the "greater hardship issue", the defendant sought to resist the order for possession on the ground that the plaintiff was not his "landlord''. The court held that the plaintiff was the landlord by virtue of the contract of tenancy, end was also prepared to reject this defence by relying on the doctrine o tenancy by estoppel. The court was clearly of the view that there was no merit in the defendant's argument, raised at that late stage. If it had been accepted, it would have resulted in the absurd situation that the defendant had no landlord and could not be removed until after the death of the plaintiff. The trustees could not have taken proceedings since they were not parties to the contract creating the relationship of landlord and tenant. (See per Lord Evershed, M.R. at p. 113)

11. The facts of the present case are, in my view, materially different from those in Stratford v Syrett. The defendant does not deny that the plaintiff is his landlord. The plaintiff is not solely entitled to the rents and profits from the premises. And, on the evidence before me, I consider that I can conclude that the plaintiff's mother was a party to the contract of tenancy.

12. The plaintiff said that although he and his mother were the joint owners of the premises, his mother left him to deal with the premises. He negotiated the various agreements with the defendant, who paid the rent by cheques made payable to the plaintiff. When the proceeds of the cheques had been received by the plaintiff, he handed the whole amount to his mother. In addition to these facts (which I find), Mr. Hoosenally sought to rely on the solicitors letter (Exh. D. 1) and the draft agreement (Exh. D. 2), which preceded the making of tire second tenancy agreement, as indications that the plaintiff was, at all material times, acting on his own behalf and on behalf of his mother in his dealings with the defendant.

13. I do not think that I should attach any weight to these documents (Exhibits D1 - D2), or to the Deed of Surrender (Exh. P. 2) made in March 1979. The defendant has never delivered up vacant possession of the premises since he became the tenant under the first agreement (Exh. P. 1). Accordingly, the tenancy created by that agreement is the only tenancy with which I am now concerned. (cf. Capital Land Investment Co. Ltd v Madam Say Kong-hai [1973] HKLR 371.) Mr. Chain, however, relies upon the fact that the plaintiff's mother was not named as a party to the first agreement, wherein the plaintiff is described as the "Landlord". It is, however, fairly settled law that such description of a pasty to a contract does not prevent a court from acting upon extrinsic evidence tending to show that the named party was acting as agent for an undisclosed or unnamed principal. (Cf Epps v Rothnie [1945] KB 562) In the present case, there is evidence from which I may infer (and do conclude) that the plaintiff entered into that agreement on his own behalf and as agent for his mother, the other joint owner. If that conclusion is correct, the prop provided by Stratford v Syrett, is, in my view, completely removed, and I am left with a situation which is not materially different from that considered by the Court of Appeal in Allied International Insurance Ltd v Hsia Jone Shu and another, supra, by which I am clearly bound.

14. If my conclusion that the plaintiff's mother is also a landlord of the premises (whether on the basis that she was a party to the first agreement or because the statutory definition of "landlord" is not exclusive is erroneous, I conceive that Mr. Chain's argument should be accepted, and that I should follow Stratford v Syrett, supra, notwithstanding my respectful view that that decision should be confined to its own special facts. It is clear that the English Court of Appeal was not concerned with the problems of co-ownership of property. It is, perhaps, not improper or irrelevant to suggest that the approach of the members of the Court was influenced by their knowledge and experience of English property law since the major reforms thereof in 1925, which removed many of the complicated rules and obstacles to tidy conveyancing found in the common law. That legislation has not been extended to, or copied, in Hong Kong. It would seem to be the case that, at common law, one of several co-owners (whether tenants-in-common or joint tenants) could not make a lease of the entire premises (but only his moiety), unless the others confirmed or consented to his purported disposition of the entirety. (See Woodfall: Landlord and Tenant (28th Ed.) para 1- 0130 and Foa's General Law of Landlord and Tenant (8th Ed 1957) p. 37.) If that is the law to be applied in Hong Kong, the plaintiff's entitlement to receive the rent in respect of the entire premises (of. S.?? 49 of Cap 7), perhaps, only exists if it is assumed that he entered into the first agreement, partlyas agent for his mother. As I have not had the benefit of argument along these lines, I have not based my decision on these considerations.

15. For the reasons given earlier, this claim must be dismissed. But, in case the matter is taken further, I will indicate briefly why I consider that the plaintiff has proved that he reasonably requires the premises. He presently lives at a flat in faterson Street, owned by his mother. It consists of 3 bedrooms and a sitting room. He occupies one bedroom. His mother and sister occupy another; and the third is occupied by his married brother and his sister-in-law. Another brother, aged 24, sleeps in the sitting room. In December 1982, the plaintiff was married in Singapore (see exhibit P. 4). His wife is still in Singapore, but expects to come to Hong Kong in May. Although the room occupied by the plaintiff is probably adequate to accommodate himself and his wife, he wishes to move to the premises, because they are nearer to his place of work (and also that of his married brother), he and his wife are anxious to start a family, and his brother, who now sleeps in the sitting-room, is planning to get married. In all the circumstances, I think that he has established a genuine present need for the premises.

16. The defendant has lived at the premises since 1977, together with his wife and two children, a son aged 12 and a daughter aged 7. They go to school in Mei Foo Sun Chuen. He has not, in my view, come anywhere near to establishing that it would be thoroughly unjust to make an order for possession. His real reason for wanting to retain the premises is because they are located near to his shop in Chungking Mansions.

Representation:

1st hearing:

Mr. Lintern-Smith of Robertson, Double & Bease for the Applicant.

Mr. Neo of H.A. Hoosenally & Co. for the Respondent.

2nd hearing:

Mr. Benjamin Chain, Counsel instructed by Robertson, Double & Boase for Applicant.

Mr. Hoosenally of H.A. Hoosenally & Co. for Respondent.