The Great China Hotel Co Ltd v. The Wo Hing Co Ltd

HCA000028/1948

ORIGINAL JURISDI CTION.

ACTION NO. 28 OF 1948

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Coram: Mr. Justice E.H. Williams.

Date of Judgment: 24 March 1948

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DECTSION

on

Inter Partes Summons for Summary Judgment

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1. This is a summons under sections 20 and 23 of the Code of Civil Procedure for leave to proceed to judgment and execution upon a specially endorsed writ for the recovery of possession of certain immovable property.

2. The undisputed facts are briefly that the premises in question were sub-let by the plaintiff to the defendants on the 15th July, 1941 for the term of 5 Chinese years from the 26th May, 1941. This period expired by effluxion of time on the 30th May, 1946.

3. The premises were exempted from the application of the Landlord & Tenant Ordinance, 1947 pursuant to section 32 thereof by an order of the Governor in Council dated the 6th January, 1948, the order being notified in the Gazette of the 22nd January, 1948. Thereafter the present action was commenced. No notice to quit was given to defendants.

4. The question for my decision is whether on these facts there is a bona fide triable issue between the parties i.e. a reasonably arguable defence in point of law.

5. The grounds of defence which counsel desires to argue are set out in para. 4 & 5 of the affidavit of Cheung Chi Yu, Managing Director of the defendant Company.

6. The defence outlined in para 4 is that no notice to quit was served on the defendants pursuant to and required by section 32(1) of the Landlord & Tenant Ordinance.

7. That in para.5(a) is that the Governor in Council had no jurisdiction to make the exemption order by reason of the failure of the Tenancy Tribunal to observe the rules and regulations binding on it under the Landlord & Tenant Ordinance, namely failure to order the plaintiffs (applicants) to supply the Tribunal and the defendants (opponents) with a copy of the grounds of their application and failure to order discovery of documents.

8. The other defences set out in sub-paragraphs (b) & (c) of para. 5. though answered by counsel for the plaintiffs in argument before me, were not argued by counsel for the defendants who intimated that for the purposes of his application forleave to defend, he was content to rely on the defences I have mentioned.

9. Counsel for the plaintiffs submitted that as regards the defence of failure to serve a notice to quit, no notice was required to be given under section 32(1) of the Landlord & Tenant Ordinance. That sub-section only required such notice to be given to a person who was a tenant at the date of the notification of the order of the Governor in Council excluding the premises from the provision of the Landlord & Tenant Ordinance. Such notice to quit was to be given as the tenant was entitled to under his tenancy agreement; it could not apply to the present defendants as their tenancy had expired by effluxion of time long before the date of notification.

10. Regarding the defence under sub-paragraph (a) of para.5 of defendants' affidavit that the order of the Governor in Council was invalid because of the Tenancy Tribunal's failure to (1) order the plaintiffs (applicants) to furnish grounds for their application and (2) to order discovery, counsel for plaintiffs submitted that the Tenancy Tribunal had adhered to the rules applicable to proceedings under section 32 of the Landlord & Tenant Ordinance: sub-sections (3) to (7) of that section together with the Forms therein specified were a complete code providing. all that was essential in such proceedings. Rule 7 of the Rules of Procedure made under section 30 which required an applicant to set out his reasons in writing in triplicate was only applicable to the ordinary proceedings before a Tribunal and not to the special case where application is made under section 32 to a Tribunal for a recommendation for exemption to the Governor in Council. He pointed out other rules made under section 30 which could not, by their very nature, apply to section 32 proceeding e.g. rule 38 which provided that every order of the Tribunal must be noted in the notes of the proceedings when the order is made: A Tribunal, when considering an application under section 32 has no power to make any order: it may only recommend and the Governor in Council makes the order.

11. Regarding failure of the Tenancy Tribunal to order discovery, he submitted that the power under section 28(2) of the Landlord & Tenant Ordinance so to do was discretionary and that in the exercise of its discretion, it was entitled to refuse to make the order. The proper procedure for defendants, if they considered they were hampered in their defence before the Tribunal by non-discovery, was to ask the Tribunal to state a special case for the opinion of the Court under section 28(5) - that had not been done.

12. He further submitted that even assuming plaintiffs ought to have complied with rule 7, no authority existed ...(illegible) the proposition that failure to do so rendered the proceedings void: it was merely an irregularity which could be waived and had been by reason of the continuation by defendants in the proceedings before the Tribunal.

13. Counsel for the defendant submitted that under section 32(1), notice to quit had to be given even though the lease had expired by effluxion of time: otherwise the tenant was a trespasser immediately the exemption order was gazetted: he had no interval of time in which to find other premises: the wording of the subsection showed that notice to quit had to be given in every case to a person in occupation irrespective of whether his agreement had expired before the date of the order.

14. On the point that rule 7 of the Rules of Procedure had not been complied with, he submitted that it was fundamental that a person should know the grounds on which it was sought to obtain a recommendation under section 32 procedure, just as a defendant in a County Court case was entitled to particulars of a plaintiff's case.

15. During the course of his submission to me, counsel for the defendants, apart from making certain generalisations on legal principles, did not attempt to deal with the arguments_of counsel for the plaintiffs. From statements he made, I gather that his view of the practice in England under Order 14 of the Rules of the Supreme Court and of what it should be under our corresponding sections is that if counsel for the defence assures the Court he has a defence, as explained in the affidavit, and in which he believes, the Court ought to accept such a statement without further question or argument. I cannot accept this as a correct proposition in law: I find no support for it in any of the cases mentioned under Order 14 in the Annual Practice or Yearly Practice.

16. Where as here, there is no dispute as to the facts, and the points to be argued are on law, the principle I should adopt is laid down in Anglo-Italian Bank v. Wells, 38 L.T.N.S. 197 namely when there is 'no fairly arguable point to be argued on behalf of the defendant' effect must be given to Order 14. The following passage in that case from the judgment of Jessel H.R. (p.200) is relevant:

"But it was suggested that, if it was a subject requiring decision of this kind, it was not fit to be decided under the rule to which reference has been made. The answer is plain. The mere reading of a short instrument like this, involving no difficult consideration as to the law, or really as to the construction, can as well be decided by a judge on the hearing of a summons as on the hearing of a demurrer, or upon the trial of an action. It would be argued by counsel in the same way, and, considering the amount and importance involved in this action, it would be tried no doubt with the same deliberation and care, in whichever way it was heard by the judge. There can be no reason whatever why the judge should not decide it the first time it was brought before him, or why he should impose on the parties the expense and delay of a second hearing of such a question."

17. Regarding the defence that notice to quit was required under section 32(1) of the Ordinance, it is quite clear that when a lease is for a definite period at the expiry of which the demised premises are to be given up, the words 'and shall be entitled to such notice to quit as would have been require under the original tenancy' cannot support a defence that a notice to quit in this particular case. What notice to quit should be given - is it a month's notice or a years notice? The original contract of tenancy provides none: no notice to quit is necessary to put an end to a tenancy for a fixed term. It is otherwise, of course, where the tenancy is a periodic tenancy. The short answer to the defence raised here is that no notice to quit being required under the lease, none need now be given.

18. Regarding the defence of failure by the Tenancy Tribunal to observe the rules of procedure and to order discovery, even assuming that the Tribunal was in error on both points, counsel for the defence has produced no authority to support that such errors invalidated the order of the Governor in Council.

19. I have, therefore, come to the conclusion that this is a case where there is no reasonably arguable defence in law: I have no reasonable doubt that the plaintiffs are entitled to judgment and I give judgment on the claim accordingly with costs.

Representation: