China Light and Power Company Limited v. Chow Chi Keung
Read the full judgment text of CACV 115/1983 on BabelCite. This Court of Appeal judgment was delivered on 11 January 1984.
1. The Respondent to this appeal (hereinafter referred to as the owner) is the registered Crown lessee of Lot 998 in Demarcation District 130, New Territories, Hong Kong. The lease is for a term of 99 years, from the 1st day of July 1898 less the last 3 days thereof.
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CACV000115/1983 IN THE COURT OF APPEAL
BETWEEN
________ Coram: Sir Alan Huggins, V.-P., Yang & Barker, JJ.A Date of Judgment: 11 January 1984 ___________ JUDGMENT ___________ Barker, J.A.: 1. The Respondent to this appeal (hereinafter referred to as the owner) is the registered Crown lessee of Lot 998 in Demarcation District 130, New Territories, Hong Kong. The lease is for a term of 99 years, from the 1st day of July 1898 less the last 3 days thereof. 2. In 1981 the Appellants (hereinafter referred to as the Power Company) constructed a power network in the New Territories. As part of this network pylons were constructed on either side of (though not on) Lot 998. However, 6 heavy power lines ran from these pylons over the said Lot - a situation referred to hereinafter as "oversailing". 3. In due course the owner applied to the Lands Tribunal for compensation for this oversailing under section 10 of the Electricity Networks (Statutory Casements) Ordinance Cap. 357, and that Tribunal made an award of $20,000. It is from that award that the Power Company appeal. 4. It is at the outset necessary to refer to certain provisions of this Ordinance. By section 3 thereof the Governor in Council may order that the Ordinance shall apply to the Power Company for the purpose of enabling such Company to carry out the network scheme. Section 4 endows the Power. Company with certain statutory easements in order to facilitate the works, which rights by virtue of section 5 cannot be exercised unless and until the order made under section 3 has been registered under the Land Registration Ordinance. The order was duly made and the registration carried out. 5. Section 10 of the Ordinance Cap. 357 reads so far as is relevant:
6. The Crown lease is a typical Crown lease - better described as a block Crown lease, being expressed to be made between His Majesty King Edward VII of the one part and the several persons, clans, families and tongs whose names were set out in the Schedule thereunder written of the other. It is common ground that the owner is a successor in title to one of the original grantees whose name appears in the Schedule, Lot 998 being described therein as "Padi". 7. The lease contained what have been described in argument as two negative covenants, which read as follow:
8. I am prepared to assume, for the purposes of this judgment, that Lot 998 was "expressed to be demised as agricultural ground", even though described in the Schedule to the lease as "Padi". (And support for this assumption can be found in Attorney General v. Melhado Investment Ltd. (1) at page 5, per Sir Alan Huggins, V.-P.) 9. Lot 998 was in area 202.34 sq. m. There were on it
10. The owner gave evidence before the Tribunal. It was not clear from that evidence whether, when he bought the Lot in 1977 the buildings at (a), (b) and (c) supra were already on it, or whether he erected them subsequently, for he gave contradictory evidence and the Tribunal made no finding on the point. What is common ground is that each year since 1977 a document known as "Modification of Tenancy" has been issued by the District Office Tuen Mun, to the Owner (and signed by the Owner as Permittee). The relevant parts of this document read as follow:
11. The main argument for the owner was that under the terms of the first negative covenant he is allowed to build or to maintain residential buildings on the Lot without a licence, since, so the argument ran, provided the residential buildings were occupied by a person or persons carrying on agricultural purposes e.g. rearing of pigs or chickens, the buildings were being used for 'or in connection with agriculture. It was further argued that so far as the first negative covenant is concerned, the Modification of Tenancy is otiose, and that if it has any effect it acts as the approval of the Surveyor for the purposes of the second negative covenant. 12. In support of this argument Blackmore v. Butler(2) was relied on. In that, case the Court of Appeal in England held that for the purposes of section 1(2) of the Agricultural Holdings Act 1948 a cottage occupied by a tenant's farm labourer was itself an agricultural holding within the meaning of that subsection, being "land used for agriculture which is so used for the purposes of a trade or business. " 13. I do not question the correctness of that decision. But in my judgment it has no application or relevance to the present case. This Court is concerned, not with the construction of a subsection of the Agricultural Holdings Act, but with the terms of a block Crown Lease. Furthermore, in such construction regard must be had to the conditions prevailing in the New Territories of Hong Kong. In my judgment the words
are not apt to cover the erection or maintaining of residential premises, though they may cover the erection of buildings such as pigsties or chicken sheds i.e. buildings used purely for agricultural purposes. 14. If it is desired to erect residential premises, then a licence must be obtained, and in my view this licence was given by the Modification of Tenancy. 15. I am fortified in this conclusion by the terms of an earlier proviso in the lease which reads:
and this is precisely what the Modification of Tenancy does specify. 16. Accordingly, it is unnecessary for me to express any opinion as to the construction of the second negative covenant. I merely record without comment the argument for the owner which was that the Surveyor's approval was concerned, and concerned only, with matters of design or style of the buildings, since to construe it otherwise would involve the owner in obtaining, two permissions to erect residential buildings. 17. In his letter of the 29th March 1982 the owner claimed compensation on the grounds
18. The Tribunal found as a fact that none of these grounds was justified, and I see no reason to disagree with these findings. However, the Tribunal viewed the property and found "that the sheer size of the lines, together with the manner in which they are strung, materially detracts from the visible appearance and enjoyment of the property. " 19. This finding can relate only to the residential buildings, and, indeed, in argument it was not contended otherwise. That being so, has the owner proved "any diminution of the value of his estate or interest therein attributable to the registration of the order"? In my judgment he has not. He is permitted to erect and, maintain the residential buildings solely by reason of the Modification of Tenancy. Each such Modification is for one year only. The owner may expact that on the expiry of a Modification of Tenancy a fresh one will be granted and that if he were to sell his land a Modification of Tenancy would be granted to the new owner, and indeed such a renewal or regrant may be probable. But section 10(5) expressly provides that no compensation shall be payable in respect of such expectation or probability. 20. The Tribunal relied upon Radnor Trust Ltd. v. Central Electricity Generating Board(3) in which the presiding judge of the English Lands Tribunal stated at page 114:
21. The facts in that case were very different from the instant case. In Radnor(3), the property consisted of a manor house with land, and in those circumstances the Tribunal's judgment is readily understandable. But in the present case, if the residential buildings are ignored, as in my judgment they must be, I cannot see how the oversailing would prove a deterrent or form a strong bargaining point to a prospective purchaser. 22. Even if I be wrong about this, the owner has not proved any diminution in value in this regard. 23. For the foregoing reasons, I would allow the appeal and set aside the award of compensation. Sir Alan Huggins, V.-P.: 24. I also would allow the appeal for the reason given by Barker, J.A. My only doubt has been whether, if we were wrong as to the construction of the first negative covenant, the Owner was entitled to a new trial. It is not beyond argument that in applying Radnor Trust Ltd. v Central Electricity Generating Board (1960) 12 P. & C.R. 111 the Tribunal was not viewing the matter solely with residential occupation in mind. If it had decided that even a person buying the property for purely agricultural purposes would have insisted on a lower price by reason of the oversailing cables, I am not sure that we would have been justified in interfering with that finding. I accept that such an attitude might be irrational, but many human beings are irrational - hence the frequent emphasis on attractive, as distinct from protective, packaging - and that is a fact which the market cannot ignore; Nevertheless, it was for the Respondent Owner to prove the amount of any diminution in value, and that he has failed to do. Yang, J.A.: 25. I agree. (1) 1982 Civil Appeal No. 79 (2) [1954] 2 Q.B. 171 (3) (1960) 12 P&CR 111 Representation: Mr. Andrew Allman-Brown (Messrs. Deacons & Co.) for Appellant. Mr. C.L. Smith (D.L.A.) for Respondent. | |||||||||||||||||||||||||||||||||||||||||||||||