632 Claimants v. The Hong Kong Housing Authority

HCMP000114G/1998

HCMP 114/98(8)

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 114 OF 1998

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Coram : Hon Sears, J. in Court

Dates of hearing : 6 and 10 November 1998

Date of judgment : 10 November 1998

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J U D G M E N T

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1. These are applications for increased payment arising from the Rennie's Mill compensation claim, they are persons who are both eligible. The first one is Mr Lui Sze Lup who works for an insurance company.

2. The method of calculation of compensation is set out in detail in a judgment I gave in March 1998. I had expert evidence called by the Housing Authority, and also by a group of 80 odd applicants from Rennie's Mill. No one owned anything in Rennie's Mill in the sense that although they owned the structure, the land on which it was built was never owned by the villagers. To calculate, therefore, the loss of opportunity to live there, one had to find a hypothetical rent that might be paid, because it was a right of occupation which had been promised. To work out this theoretical rent, one, first of all, has to find what the cottage area was. The Housing Authority wanted to use the area permitted under the permit; the residents wished to use the area which included additions which they had built on. Sometimes, it substantially increased the area of the cottage. I found in favour of the villagers, so the area to be taken is the larger area.

3. The next matter to be decided was the yield that would be obtained on a hypothetical basis of capital investment. The experts of the Housing Authority said 8%, and that for the residents said 7%. I, in fact, took a figure of 7.5%. This, however, was not a split between the two experts because I disregarded the expert called by the residents. The conclusion is set out in my judgment at page 7. One also has to find what is the possible monthly rent, and the only way to discover this was to examine comparables. I set out in detail the method of calculation of a unit rent of $61 per sq.m. This was a discount of 60% on a unit rent figure of $152. This was higher than the Housing Authority's expert.

4. There is a factor which is called the "capitalization factor" based on the yield I have reached and the life expectancy. The life expectancy is taken from published statistical tables by the Census Department. These are used also by the courts in calculation of damages under the Fatal Accidents Act, and in my judgment they are accepted by the courts as a statistical basis for life expectancy.

5. In the case of Mr Lui Sze Lup, the figure taken is based on his sister who was living there because her life expectancy is higher which is 84. Mr Lui Sze Lup said it should be 100, everyone should live to 100. I wish we all could. He puts forward that the monthly rental should be a higher figure, and the end result is that he should get nearly $3 million instead of $440,000 odd to which the Housing Authority said he is entitled.

6. I reject his evidence. He admits he is not an expert. It is, in my judgment, another instant of villagers being greedy. There is nothing put forward which would justify me in departing from the formula set out in my earlier judgment. His application for increased payment is dismissed.

7. The second person, Mr Ng Fan, puts forward even more exaggerated figures and says that he should be entitled to several million dollars. He says the monthly rental should be $120 instead of $55. There is no basis for this figure at all. He says he should get a higher figure for his workshop. In my judgment, the appropriate area has been taken into account. He also says that he should get additional money because the school was closed down.

8. The offered figure, about $1.1 million, has been split between him and his two brothers. They have accepted the money. The figures put forward by the Housing Authority, which is based on the judgment I gave in March 1998, gave increased sums of money to the villagers. I should only add this. The calculations that were made then were based on figures in 1996. Had this case been decided on figures today, the amount of compensation given to the villagers would probably be a third less caused by the fall in market rentals.

9. In my judgment, the villagers have been treated very fairly here, and this application is also dismissed.

Representation:

Mr Lui Sze Lup, Application No. 655, in person

Mr Peter Fan, Application No. 656, in person

Mr Peter Ng, inst'd by M/s Simmons & Simmons, for the Respondent