Yam Chun Shui, Trading As "Marlbo" v. The Prudential Enterprise Ltd

CACV000067/1984

BETWEEN

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Coram: Fuad, J.A., and Kempster and Mantell JJ.

Dates of hearing: 24th and 25th May 1984

Date of judgment: 25th May 1984

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JUDGMENT

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Fuad,J.A:-

1. This is an appeal from an interlocutory injunction granted by Mayo J. on the 13th April 1984. The dispute is between one of the tenants of a shopping mall in the Prudential Centre, Nathan Road, and the management of the Centre. I will read the terms of the order appealed against later.

2. The plaintiff, Mr. Yam Chun Shui, who trades as "Marlbo", rented two shops in the Prudential Centre in December 1983 for a termoof three years from Prudential Enterprise Ltd. ("Prudential"), at a rental of $9,205 per month for each shop. Mr. Yam, who describes his business as the sale of fashion accessories, took out a writ against Prudential on the 21st January 1984. The Statement of Claim which accompanied the writ, after the usual introductory paragraphs, pleaded that it was an implied term of the tenancy agreement that Prudential would not cut off the electricity supply without lawful or reasonable excuse, and that in breach of the implied term the electricity supply had been cut off from 11.50 a.m. to 6.10 p.m. on the 5th October 1983. It was also averred that Prudential intended and threatened, unless restrained, to disconnect the electricity again. Mr. Yam claimed damages and an injunction.

3. On the 24th January 1984, the plaintiff obtained an interim injunction ex parte, from Barnes J., returnable on the 31st January. The order directed Prudential to re-connect the electricity supply, and restrained them from cutting it off again until the inter partes hearing. It is common ground that the electricity supply was immediately restored once the court had made the ex parte order.

4. The inter partes summons was duly taken out by the plaintiff on the 25th January. However, on the 30th January there was an order by consent that the hearing fixed for the following day be vacated and that a new date be fixed in consultation with Counsel's diaries. Mcanwhile, the order made by Barnes J. would continue in effect.

5. On the 9th March Prudential took out a summons for an order (a) that Marlbo permit Prudential to enter, and remain on, the shops for the purpose of testing the wiring and electrical installations on 24 hours' notice and (b) that the ex parte order made on the 24th January be varied to allow Prudential to disconnect the electricity supply for testing purposes. The two Summons came on for hearing before Mayo J. on the 12th April.

6. In the meantime, Marlbo had, on the 21st March, by leave, amended the Statement of Claim to aver that in addition to the interruption of electricity for the six hours on the 5th October 1983, the supply had again been cut off from noon on the 23rd January until 3.10 p.m. on the 25th January. There were other minor amendements which do not concern us, and the reliefs claimed remained substantially unaltered.

7. Prudential's Defence was filed on the 23rd March. Its substance was that while the interruption of electricity supply had occurred on the two dates (and for the duration) pleaded in the Statement of Claim, the electricity had to be cut off for safety reasons in order to inspect and test the installations in accordance with the landlord's rights under the tenancy agreements. This was the state of the pleadings when the hearing took place before Mayo J.

8. Mayo J. had before him an affirmation from Mr. Yam Chun Shui, the sole proprietor of Marlbo. He said Prudential had before the 5th October 1983 claimed $3,000 from him to pay for the installation of Perspex over the entrance to the shops. He had refused to pay this sum because Prudential were not entitled to it. Prudential had then pretended that certain problems had arisen with the electrical installations in the shops as an excuse to cut off the electricity supply for the six hours on the 5th October 1983. Since he had to carry on business, he was forced to pay $2,060.00 of the sum originally demanded, whereupon the electricity supply had been re-connected.

9. Mr. Yam then goes on to say that his experience, shared by the other tenants, was that Prudential was a "very unreasonable and greedy landlord who would use all sorts of excuses to demand money from the tenants." Prudential's unreasonable conduct had forced them to establish a tenants' association to protect their legal rights; moreover in January 1984, 58 of Prudential's tenants (of which he was one) had filed an action against them seeking a declaration that they were not entitled to increase the management fees and electricity charges, and that the percentage of increase demanded was excessive.

10. Mr. Yam added that Prudential were not pleased with his actions as a committee member of the tenants' association and that on the 1st November 1983 Prudential's Mr. Samuel Tak Lee had threatened over the telephone "to break his legs" if he created trouble. Two letters he had received from Prudential (which he exhibited) had led him to make a report to the police.

11. Among the other allegations made against Prudential by Mr. Yam was that they had repeatedly threatened to cut off his electricity. He had had to get his solicitors to write letters about these threats.

12. Speaking of the second disconnection, Mr. Yam says that Mr. Tang had told him at 10:45 a.m. on the 23rd January that the electricity would have to be cut off and Mr. Tang could not tell him why, except to say that it was the landlord's business. When the supply had been disconnected at noon, he had gone to see Mr. Tang again, with the same result. He had then reported the matter to the police. When the police came, Mr. Tang told them that work had to be carried out on the electrical installations. Mr. Tang did not have the keys to the meter room, when asked for them, and had gone off to lunch.

13. Mr. Yam said he had also reported the matter to China Light & Power and Mr. Tang had refused to open the meter room.

14. Mr. Yam said that he did not believe that there was anything wrong with the electricity installations in his shops and he had obtained "certificates of stability" to this effect, on the 9th December 1983 and the 12th January 1984.

15. Mr. Yam's affirmation is dated the 24th January and he states that his Solicitors had warned Prudential that he would apply for an injunction.unless the electricity was reconnected, and while it was cut off he could not carry on his business and would suffer irreparable damage.

16. On behalf of Marlbo, there were four other affirmations. A former partner of a firm which is still one of Prudential's tenants, Mr. Chan Cheuk Cheong, said that his experience had shown that Prudential were very unreasonable landlords and had adopted a policy of cutting off electricity supplies to compel their tenants to comply with unreasonable demands. A tenants' association had had to be formed to protect their interests. He had been threatened with the disconnection of his electricity supply on the 25th October 1983. He had spoken to Mr. Samuel Tak Lee who had told him not to cause trouble. Mr. Lee had also told him that he should not act as the chairman of the tenants' association and that if he did not co-operate with him, his electricity supply would be cut off. On the 1st November 1983, without any notice, this had happened. He had complained to Prudential and then reported the matter to the police and to the electricity company. His supply had been re-connected at 3:15 on the following day. The tenants' association, through him, had asked their lawyers to write to Prudential. On the 7th November, half an hour after the letter had been delivered to Prudential, his supply had been cut off again. His complaints to Prudential, the police, and the electricity company had been of no avail. His electricity supply had never been reconnected (he was affirming on the 7th March 1984) and he had had to wind up his business.

17. The second tenant who made an affirmation about the matter was Miss Teresa Yam May Cam. She stated that she was able to tell from her experience that Prudential had adopted a policy of cutting off, or threatening to cut off, electricity supplies to force tenants to accede to their demands. In August 1983 she had had to go to Japan. She was told, on her return the following month, by the man she had left in charge of her shop, that on the 31st August Prudential had asked why rent was overdue. When told that Miss Yam was away and would return in two days' time he had been told that the electricity would be cut off. This had happened on the following day. After she had paid off the arrears the electricity had been re-connected. I will mention here that unless I have missed something, there is no specific response to this affirmation.

18. Prudential's practice of cutting off electricity to force tenants to submit to their demands was also spoken of in general terms by Mr. Kao Hon Wing, another of their tenants. His affirmation deals with an incident that took place on the 19th February 1984. He said that on that day Mr. Chung had invited him to tea in the Bangkok Hotel. There, Mr. Chung had given him a photo-copy of a draft affirmation (which he exhibited) that was to have been made by Mr. Samuel Tak Lee. Mr. Lee had told him that the contents of the draft were largely untrue, and that he was worried about legal responsibilities and so he had asked him (Mr. Chung) to sign the affirmation in his place. Mr. Chung had said he had been unable to find another job and had reluctantly agreed to follow Mr. Lee's instructions to affirm although he knew the affirmation's contents were not true. Mr. Chung had admitted to him that Prudential "usually adopted the method of cutting off electricity supply to the tenants as a tactic against the tenants." Mr. Chung had acknowledged that their conduct had been wholly unreasonable but that he had had to carry out their orders. Mr. Kao concluded hid by saying that he felt he should say what had happened so that the court would not be misled by Mr. Chung.

19. The fourth tenant who made an affirmation on behalf of Marlbo was Miss Yuen Yuet Chun. She said that she was one of the plaintiffs in the action instituted against Prudential for the declaration about the increased charges. She had been asked by Mr. Chung on the 10th November 1983 to agree to the new charges, adding that since here shop was a small one the increase would not be great. She concludes by saying that when she had enquired whether her electricity would be cut off if she refused to pay at the higher rate, Mr. Chung had replied that this was indeed Prudential's policy.

20. I will now review the contents of the affirmations filed in support of Prudential's stand. The most important affirmation about their case were made by Mr. Peters Chung Leung Kee who is the marketing manager of Prudential and one of the executive officers of the shopping arcade. He explains that there are 92 tenants of the Prudential Centre. Stage I (the Shopping Arcade) of the development of the Centre was completed at the end of 1982. Nine storeys of Stage 2, which is the construction of an hotel tower block is still under construction. Two power systems were installed for the shopping centre. One system supplies lighting to the tenants' shops and the other electricity for the escalators, lifts, air-conditioning, ventilation and lighting of the corridors and public areas of the arcade. To maintain the safety and efficiency of the two very advanced and delicate systems, Prudential must, he says, have full control and knowledge of their tenants' electrical installations. Under the tenancy agreements, tenants were not allowed to carry out any electrical installations without submitting detailed plans and obtaining approval first.

21. Marlbo's plans had been approved. As more and more tenants moved in, some began to increase their electrical installations to a dangerous level - this resulted in overloading and there would be a black-out in the particular shops concerned. When this happened, after the installation had been checked and when the wiring had cooled and it became safe to switch on the electricity again, this was done.

22. Mr. Chung categorically denied the allegation that electricity was cut off to make tenants submit to Prudential's demands. As regards Marlbo, their glass door had been broken in March 1983 and had been replaced by Prudential. Marlbo had refused to pay for the repairs despite their obligation to do so under the tenancy agreement. They had only paid up after a solicitor's letter of demand - the amount involved was $10,000.

23. In April 1983 Marlbo had complained about the working of their air-conditioning. Part of the problem had been due to the cool air escaping into the corridor when their staff failed to close the sliding door - and too much heat had been generated by some of Marlbo's increased electrical installations. And so, according to Mr. Chung, negotiations resulted in an agreement that Prudential would install perspex glass just outside the shops to act as an air-conditioning barrier. In return, Marlbo agreed to stop their sale girls eating their lunch in the shops - the image of the shopping arcade had been tarnished and complaints had been received about this - apart from the specific requirements of the tenancy agreement.

24. Mr. Chung continues that after the perspex screen had been installed, Marlbo did not keep their side of the bargain. At the beginning of September 1983, Prudential had therefore written to Marlbo, demanding reimbursement of the cost of the perspex screen. Marlbo refused to pay, and refused to show Prudential the insurance policy they were required to take out in relation to the perspex screen. Letters were exchanged between their solicitors and eventually an amicable settlement was reached under which Marlbo paid $2,060 towards the costs of the perspex. It took until December 1983 (and only after lengthy correspondence) before Marlbo produced the insurance policy Prudential had been asking to see.

25. Mr. Chung said that their Estate Manager noticed increased lighting in Marlbo shops, not covered by the previous approval given. The overloading had led to a black-out of the shops. In accordance with the tenancy agreement's terms, Prudential asked Marlbo to be allowed to inspect their electrical installations. Other shops suspected of overloading. had also been inspected. When this was done the power had to be cut off but with the tenant's co-operation it could very soon be restored.

26. On the 5th October 1983, Mr. Chung continued, a number of shops, including Marlbo's had to be inspected. The tenants were informed of the reasons for the inspection and the temporary disconnection. However, Marlbo's solicitors demanded immediate re-connection and Marlbo called the police and the electricity company. The process of inspection had to be suspended and the power switched on again.

27. Far from disapproving the formation of the tenants' association, Mr. chung said, Prudential had welcomed it as correspondence showed. The necessity for increasing air-conditioning charges and management costs was explained to all the tenants by circular letters, and the matter was now the subject of litigation in separate proceedings.

28. After referring to another dispute, involving Mr. Yam of Marlbo and one of Prudential's security guards, Mr. Chung spoke of power failures on the 3rd December 1983 due to overloading by some of the tenants. Mr. Yam had caused a scene during one of them. As an alternative to inspection, Prudential had invited Marlbo, through their Solicitors, to supply an up-to-date wiring programme and air-conditioning plans since Prudential thought that their installations differred from the approved plans. Marlbo denied any alterations but would not allow inspection by Prudential. They produced the two stability certificates to which Mr. Yam had referred in his affirmation. About these, Mr. Chung said, they did not mean that the system had not been overloaded.

29. Mr. Chung went on to say that while he was away on holiday, on the 1st January 1984, there was another major power failure, due, most likely, to overloading by tenants. Specialist consultants were appointed to conduct a thorough check of the two electricity systems. The consultants drew up a list of items that needed checking, testing and servicing. While some of the work could be done at night, some testing had to be done in the tenant's shop, in his presence. Marlbo was on the list. Work began on the 22nd January 1984 and went on all through the night of the 22nd January. Once again Marlbo prevented the testing from taking place on their premises - and as at the date of making his affirmation (the 3rd March 1984) those shops could not be inspected and this was why Prudential had taken out their summons.

30. Mr. Chung's affirmation was supported as regards some of the incidents by Mr. Tang Jack Kai, Prudential's electrical engineer. He gave details of the major breakdown of electricity on the 1st January 1984 as a result of an explosion in the incoming cable to the Centre. Emergency repairs were carried out. After the consultants had been appointed, he had gone to look for Mr. Yam to tell him his electricity supply had to be cut off for the inspection and testing - this was on the 23rd January. After he had done this, the supply was disconnected. He had never denied that he had the keys to the meter room. On the 24th and 25th January, when employees of the consultants wanted to de their work, access could not be gained to the Marlbo shops. As soon as they heard of the interim injunction, the power had been restored.

31. Mr. Samuel Tak Lee, one of Prudential's directors, and a structural engineer, denied the allegations made by Mr. Yam about threats. This was not the first time that such groundless allegations had been made against him. Despite the fact that the payment for the Perspex screen had been amicably arranged through solicitors, in October 1983, Mr. Yam had made a complaint to the police, in November, that he had personally threatened him and demanded the $2,060. The police had accepted his explanation.

32. Then there is a detailed affirmation from the director and general manager of Junefair Engineering, Mr. Martin Fong Wang Hoo, the company Prudential had employed as consultants. He explained the technical aspects of the dispute, including the probable cause of the power failures. It was essential in his view that in a large building such as the Prudential Centre, the Management should have complete control and supervision of the electrical installations of all the tenants. Apart altogether from overloading, there were sometimes poor connections, sub-standard installations, defective wiring - all which could lead to short-circuits or fire hazards. He explained why the power to the Marlbo shops had had to be disconnected on the morning of the 23rd January 1984. Junefair had decided to stop further work under the consultancy in case other tenants followed Marlbo's example, until the present dispute was over. Their task was not just to check actual overloading but to see if there had been departures from the originally approved plans, especially since they had been informed that unauthorised contractors had done some electrical work in the shops. All this could be done in about two hours if the tenant co-operated.

33. In a further affirmation, Mr. Chung refers to the affirmation of Mr. chan Cheuk Cheong. He had been approached by three of his partners who had told him that they were not happy about the way Mr. Chan was conducting the business. They wanted to negotiate to surrender the lease to Prudential. An amicable arrangement was reached on the 29th November 1983 and the surrender made. He denied Mr. Chan's allegations.

34. Then there is another affirmation from Mr. Tang Jack Kai about an incident when Mr. Chan had come to his office with three or four young men and had accused him in a threatening manner of maliciously cutting off the electricity supply. He had ordered a security officer to make them leave his office in the Prudential Centres. Mr. Chan had fetched the police and they had gone to the police station together where nothing was settled. He had been unable to check the cause of the power failure in Mr. Chan's shop because of his threatening attitude. There was no truth in the allegation that the power had been cut off to Mr. Chan's shop on the 7th November 1983 never to be restored.

35. In another affirmation, Mr. Chung repudiates Miss Yuen's allegation that he had threatened her with disconnection if she did not pay the increased electricity and management fees, although he had discussed the need for these increases with her.

36. In his final affirmation Mr. Chung gives his version of what took place between him and Mr. Kao Hon wing on the 19th February 1984 in the Bangkok Hotel. He had called on Mr. Kao's shop in the Centre to look into a complaint about the air-conditioning. He had known Mr Kao for along time and had discussed Prudential's dispute with Mr. Yam with him, suggesting that the tenants' association should not only listen to Mr. Yam's side of the case. The discussion had continued in the hotel. He had shown Mr. Kao the draft affirmation to explain Prudential's stand in the dispute, hoping that Mr. Kao would, in turn, explain it to the committee of the association. He wanted Prudential's case to be understood whatever they decided. Mr. Kao had seemed interested in the draft affirmation arid' so he had given it to him to read thoroughly before returning it.

37. Mr. Chung denies saying that the contents of the draft were largely untrue; nor had he said that Mr. Lee had been unwilling himself to make the affirmation. What he might have said, by way of appeasement, was that he "felt bad about the whole affair escalating into such a big case". His attitude throughout was one of` appeasement "and I might have given Mr. Kao the impression that I felt at times that Mr. Lee was being unreasonable." But he had never said that Mr. Lee usually adopted the method of cutting off the electricity as a tactic against the tenants.

38. What is beyond dispute is that Mr. Chung's first affirmation is obviously a re-draft of the draft affirmation supplied to Mr. Kao, and is substantially the same as to its contents.

39. I have reviewed most, but not all, of the evidence on the affirmations. In his judgment, Mayo J. said that he saw his task as being to ascertain whether the plaintiff had a good arguable case and, if so, whether the balance of convenience was in favour of the injunction being continued. He referred to the conflict in the evidence. While not wishing to make an adjudication on the facts at that stage, he said he was satisfied that the plaintiff had succeeded in establishing an arguable case of a breach of the landlord's covenants or conditions of quiet enjoyment under the tenancy agreement. It was a breach of the covenants if the landlord's rights under the agreement were used as an instrument of oppression. In his view the question of the balance of convenience was a difficult one. He was not prepared to continue the injunction if this had the effect of entirely preventing the landlord from exercising his important rights and thereby placing the safety of the entire building at hazard. However, the difficulty would be met by granting a carefully worded injunction. And so the injunction he granted was in these terms -

"IT IS ORDERED that the Defendant be restrained whether by itself its servants agents nominees or otherwise howsoever from cutting off or causing to be cut off the supply of electricity to Shops Nos. 21 and 22 on the Upper Ground floor of Prudential Centre, 216-228A Nathan Road Kowloon until after the trial or until further order provided that the Defendant be at liberty to enter and remain upon the said Shops for the purpose of testing the wiring and electrical installations therein upon 24 hours notice being given by the Defendant's agents to the Plaintiff and that the Defendant by its servants and agents be permitted to disconnect the electricity supply to the said Shops during the process of such testing and further provided that such an injunction shall be without prejudice to the Defendant's rights to be exercised whether by itself its servants or agents to disconnect the electricity supply for a proper and lawful purpose.

IT IS FURTHER ORDERED that the parties be at liberty: to apply."

40. Before opening the appeal on, behalf of Prudential, Mr. Litton conceded, in response to comments that were made, that the original Notice of Appeal set out grounds which were not sufficiently specific. This is all that was said -

41. However, by leave, the grounds of appeal were amended, and they are how as follows -

42. Mr. Litton took us through some of the evidence in the affirmations and drew our attention to significant allegations made by each side, and to important letters which threw light on the matter. He summarised the rights and obligations of the parties under the tenancy agreements (which were identical in terms for both shops) and submitted that there was strong evidence that Marlbo had made unauthorised alterations to their electrical installations, and that some of the tenants of the Centre had caused the electrical system to be overloaded.

43. Mr. Litton contended that an injunction in the terms in which it was granted was wrong in principle because it put Prudential under threat of committal proceedings even when exercising their legal rights. It gave the tenant, as he put it, the weapon of contempt procedures in his armory of contractual enforcement. The Court had to take a borad view of the matter and appreciate that in general terms no act was prohibited by the injunction for the order aimed only at the motives for performing the act. It was no comfort to Prudential that the likelihood of successful contempt proceedings was remote. Since Marlbo had demonstrated animosity towards Prudential, they should not be made subject to such a threat.

44. I will say at once that I entertain no doubt at all that it would be wrong in principle to grant an injunction or the ground that its terms would in no way be onerous upon the defendant.  If the proper foundation for the grant is not there, he is entitled to have it discharged even though it will occasion him no real difficulty. However, I am unable to agree that no act by Prudential was, in practical terms, prohibited by the order - the act injuncted until trial was the disconnection of the electricity supply for other than legitimate reasons.

45. Mr. Litton's main attack on Mayo J.'s judgment was the submission that he had confined his consideration of the strength of Marlbo's case to a particular paragraph of the Yam's affirmation (para. 3) - the alleged breach of the landlord's covenant for quiet enjoyment was limited thereto the incident on the 5th October 1983. Since this breach was in the past it was remediable only in damages; and this was the usual remedy. It would, Mr. Litton urged, only be in extreme cases that the trial judge would consider granting a permanent injunction on the facts averred. It had to be borne in mind that on that occasion the electricity had been cut off for only six hours.

46. Mr. Litton contended that it must be presumed that the Judge did not take into consideration the events which took place in January this year, because he did not mention them. The practical realities of the situation were such that the grant of the interlocutory injunction effectively disposed of the only issue in the action - the claim for damages for loss of trade for the six hours during which the power had been disconnected. Since a permanent injunction was unlikely to be granted at the trial, how could, Mr. Litton asked, Marlbo get more at the interlocutory stage?

47. With due respect to these submissions, I am in no way persuaded that the Judge did not have regard to all the allegations made by Mr. Yam, and those contained in the other affirmations filed in support of his case. One must, of course, approach the point from the inherent improbability of the Judge basing his decision on just one paragraph of one of the 14 affirmations before him. And then, his reference to "the affidavit evidence" with the rest of what he said in the second paragraph of his judgment indicates that the Judge perceived his task as being to ascertain whether or not the plaintiff had made out "a good arguable case" on the basis of that evidence.

48. If I am right, the foundation for much of Prudential's case, on appeal, falls to the ground. Of course, no one can say what course the trial will take but it seems to me that it is not possible successfully to maintain the contention that this was a case where it had been clearly demonstrated that the plaintiff would not be able to obtain. a permanent injunction at the trial. I all the evidence that presumably will be led by Marlbo is accepted, it would surely be the sort of case in which, an injunction, whatever may be its final form, might be granted - to prevent the repetition of, if they so prove to have been, illegal and authorised acts; and he put an end, if it is so held, to harassing conduct.

49. In my judgment it follows, therefore, that this was certainly not a case where the judge should not have gone on to consider the balance of convenience, on the grounds (to paraphase slightly the words of Lord Diplock in American Cyanamid v. Ethicon [1975] A.C. 396 at p.408) that the material available at the hearing of the interlocutory injunction failed to disclose that the plaintiff had any real prospect of success in his claim to a permanent injunction at the trial.

50. Mr. Litton placed great reliance before us on Fletcher v. Bealey [1884] 28 Ch. D. 688. For my part, I read that case as one in a line of authorities for the propositions that if there is no justification for supposing that there is any danger of serious damage being done before the assistance of the court can be invoked, an injunction will not be granted - the court will hot normally interfere until actual damage has been occasioned. However, it has power (by virtue of its jurisdiction to restrain acts which when completed will found an action) to intervene by injunction before any actual nuisance (or other relevant tort) has been committed, if it is satisfied that the act of which complaint is made will inevitably result in e.g. a nuisance. And it is in these circumstances that a plaintiff must show a strong case of probability to persuade a court to exercise its power at that stage. With due respect to Mr. Litton's forceful submissions, I can find nothing in Fletcher v. Healey that assists Prudential on the material and issues before us, so as to require Marlbo to demonstrate more than that there was a serious issue to be tried.

51. It follows from what I have said that I am unable to accept the proposition that, realistically viewed, the position was such that the grant of the interlocutory injunction effectively disposed of the issues in the action. It seems to me to be quite irrelevant whether costs might or might not be awarded on the District Court scale. And I am bound to say that I find invalid the contention that the Judge failed to have regard to the practical realities of the situation. In my view the terms of the order made indicates quite the contrary. I would say here that I do not consider that NWL Ltd. v. Woods [1979] 1 W.L.R. 1294 governs the present case, either in respect of its principles or its spirit, as views I have earlier expressed will have shown.

52. We are here concerned with the exercise of the discretion of an experienced Judge who had the benefit of very full arguments from, if I may say so, able Counsel. I see that there is a case on Mr. Ma's list of authorities (we did not, in the event, call upon him during the hearing) which reminds us in forceful terms of the proper role of an appellate court where the discretion of the Judge below is involved - Hadmor Productions Ltd. v. Hamilton [1983] 1 A.C. 191. I have in mind, of course, that part of the speech of Lord Diplock, at p.220, where the re-states the "limited function of an appellate court" in matters of this kind.

53. It cannot be said that the affidavit evidence before the Judge did not show that there was a serious question to be tried, and I did not understand Mr. Litton to submit in so many terms that the position was otherwise. Once that was so I can find no warrant to interfere with Mayo J.'s assessment of the balance of convenience, revealed by his decision. It would be quite improper to form or indicate any opinion today as to the prospects of success of either party at the trial. I interpolate here that I should have mentioned earlier that I do not accept Mr. Litton's stand that there are clear indications that the case will not go to trial.

54. To resume, in my judgment the learned Judge made a sensible and practical order. It is relevant here, think, to recognise that the terms of the order are hot onerous upon Prudential; they can assert their rights, and carry out their obligations, as landlords, provided they do not disconnect the electricity supply to Marlbo's two shops from improper motives.

55. If what Marlbo say turns out to be true, the damage they might suffer would be extremely difficult to assess and surely a landlord cannot be permitted (if such was the case) to use his legal rights as an instrument of coercion or oppression, and then be heard to say that damages are readily available to the tenant for any loss of trade and inconvenience during times when the electricity supply is cut off. Indeed, it might be said that the terms of the Judge's order had the practical effect of preserving the status quo.

56. It may well be that had Mayo J. thought it right to adopt the "broad principle approach" suggested by Eveleigh L.J. in Cayne v. Global Natural Resources plc. [1984] 1 All E.R. 225, at p.232, and asked himself the question "what can the court do in its best endeavour to avoid injustice", the result would have been the same. However, I am not prepared to hold, as has been urged upon us, that it was in fact necessary for him to do so in the present case which, it seems to me, must be governed by the guidelines set out in American Cyanamid, in the light of the particular circumstances of the case, without any gloss being placed upon those guidelines.

57. I would therefore dismiss the appeal but direct that the order made by the Judge be corrected to cure the defect remarked upon by my Lord Kempster J. during argument, so that it includes the plaintiff's undertaking as to damages in the usual way.

Kempster, J.:

58. Before exercising his discretion to grant an interlocutory injunction in circumstances where the plaintiff alleges an existing cause of action, a situation contrasting with one where the plaintiff claims relief quia timet or where it is patent that there will never be a trial, a judge must, in my view, find three matters concluded to his satisfaction in the plaintiff's favour -

59. Did Mayo J. go through these mental processes in making the order under appeal? Were such processes and such questions the basis of the exercise of his discretion? Reading what is called his "Decision" I think he did and that they were. In the second paragraph he referred to the whole of the affidavit evidence; accepted the submission that there was no call for him, at that juncture, to adjudicate on the issues on the basis of such evidence and then -

"I accept that what I have to do is to ascertain whether the plaintiff has a good arguable case."

That, in my view, necessarily meant a good arguable case for the grant of a permanent injunction at trial and that the Judge had considered the alternative of damages as an adequate remedy. In due course he expressed himself satisfied that the plaintiff had succeeded in establishing an arguable case of a breach of the landlord's covenants or conditions of quiet enjoyment under the Tenancy. And then he went on to say -

"It is however a breach of the terms of the Tenancy if the defendant's right to go into the plaintiff's property to correct the electrical faults were used as instrument of oppression."

Again I quote :

"As I have said the plaintiff has made on affirmation a statement that the defendants have exercised their powers in this way."

"In this way" meant as an instrument of oppression. The learned judge mentioned this point, I am satisfied, to indicate his finding that interlocutory relief was required to preserve the status quo until trial. Preservation of the status quo is, and I think this must be common ground, a most material factor when considering the balance of convenience.

60. Further as my Lord Fuad J.A. has indicated, the terms of the injunction which the judge in fact ordered strongly suggest that he approached the matter in the broad manner commended by Mr. Litton and sought to exercise his best endeavour to avoid injustice having regard to the practical realities. That was why he did not give an unqualified injunction in the plaintiff's favour. For these reasons and those explained already by my Lord I agree that this appeal should be dismissed.

Mantell, J. :

61. I agree that this appeal must be dismissed for the reasons given by my Lord Fuad J.A. and my Lord Kempster J. I desire to add very little.

62. In my opinion Mr. Litton has correctly identified the principles upon which the Court should proceed in cases where an interlocutory injunction is sought. On application of those principles to the circumstances in this case, however, I cannot agree that the learned judge was wrong in granting relief; nor, save on the most illiberal construction of his reasons, do I think it possible to say that he did not address himself to all relevant considerations. Here on paper there are triable issues which if resolved at the trial in the plaintiff's favour will very likely lead to the making of a permanent injunction. It is not a case where damages would be a sufficient remedy. It is not a case where the interlocutory order disposes of the issues between the parties. There is no reason to suppose, as Mr. Litton suggests, that this action will not proceed to trial.

Representation:

Henry Litton Q.C. and Charles Sussex (Gallant Y.T. Ho & Co.) for the Appellant/Defendant

Geoffry Ma (Lo, Wong & Tsui) for the Respondent/Plaintiff.