Chest Gain Development Ltd v. Commissioner of Rating and Valuation

HCAL 110/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO. 110 OF 2005

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BETWEEN

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Before: Hon Reyes J in Court

Date of Hearing: 30 August 2005

Date of Decision: 30 August 2005

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D E C I S I O N

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1.In my view there should be a stay until the hearing before Hartmann J in December 2005 or further order.  The stay, however, is to be conditional on the Applicant giving an undertaking along the lines sketched out in Court by Mr. Pow.  My reasons are briefly as set out below.

2.First, I think that the Applicant's case is strongly arguable.

3.Second, similar cases should be treated similarly.  In HCAL No. 71 of 2005 there is a stay pending Hartmann J's determination in December.  There is a similar stay in relation to a like matter involving the MTRC, also pending Hartmann J's ruling.  I appreciate that the stays in those cases where not consequent upon the hearing of oral submissions from the Commissioner.  But I believe that it is best to await Hartmann J's determination, rather than to anticipate or even preclude it by any decision of mine.

4.Third, I am not persuaded by Mr. Litton's arguments.

5.Mr. Litton first says that the Commissioner may apply in the future (on the ground of delay by the Applicant) to set aside the leave granted in this case.  I do not think that I can decide this matter on the basis of what the Commissioner may or may not do and on grounds which he may or may not argue.  If the leave granted here is set aside, the question of stay can be revisited in light of that supervening event.

6.Mr. Litton refers to the public interest element in this case.  However, there is also the question of the Applicant's legitimate expectation.  If the Applicant is right that the Commissioner wrongly revoked his decision to hold over, I do not see why the public interest should necessarily override the Applicant's legitimate expectation.

7.Mr. Litton refers to Rent Ordinance s. 29(1) which requires payment of Government rent even if there has been an appeal against the assessment.  But one must also look at ss. 29(2) and (5).  The Commissioner may agree to hold over payment.  He did so here and the Applicant says that he wrongly revoked that decision to hold over.  I do not see how looking at s. 29(1) alone advances the balancing exercise that the Court has to carry out, one way or the other.

8.Mr. Litton points to the absence of evidence of financial hardship if the Applicant has to pay the $17 million+ assessment now.  It is true that the evidence on this is scant.  But the question of hardship is not in the forefront of Mr. Pow's submissions.  He relies more on the strength of his case and on the principle of treating like cases alike.

9.Mr. Litton refers to possible prejudice to the Government if a stay is granted.  This (Mr. Litton stresses) is only one of numerous similar cases.  If there is a stay on all those cases, the Government may be kept out of its money for a long period of time until all relevant proceedings have been resolved.  In my view, this is not an overwhelming factor.  One must look at the merits of each individual case.  One must also bear in mind that the interim stay now sought before me is only for some 3 months.  The interest (if any) due to the Government, if the Applicant proves to be in the wrong on the question of stay in December 2005, should not loom large in the scale of things.

10.Mr. Litton says that the Applicant should give an undertaking in relation to any interest payable, as the condition of a stay.  Mr. Pow's offer of an undertaking and the Court's requirement of such as a condition of a stay deals with this point.

11.I also direct that the balance of the Applicant’s summons for a stay pending the outcome of its judicial review, be heard in December 2005 along with the Commissioner’s setting aside application in HCAL No. 71 of 2005.  Further, the substantive judicial review in these proceedings should be heard at the same time as the judicial review in HCAL No. 71 of 2005. 

12.I do not believe that the directions just mentioned will significantly extend the time estimates for the stay and review hearings before Hartmann J.  This is because Mr. Pow is likely to rely on the same (if not identical) points as the Applicants in HCAL No. 71 of 2005.  However, if it later appears that there will be serious time implications, the parties can arrange a brief appointment before me or Hartmann J for further directions as soon as possible.

13.The undertaking which Mr. Pow suggested is essentially this: Without prejudice to any of its contentions, the Applicant undertakes to pay damages reflected by such interest (if any), dating from 1 September 2005, as Hartmann J might order in December 2005 as a condition for the grant of an extended stay pending resolution of the Applicant's judicial review.  The actual text of the undertaking is appended to this Decision.

Mr Jason Pow, SC instructed by Messrs Iu, Lai & Li, for the Applicant

Mr John Litton, instructed by Department of Justice, for the Respondent

UNDERTAKING

UNDERTAKING to pay damages reflected by way of loss of interest at an interest rate to be determined by Mr. Justice Hartmann (which is upheld on all appeals) at the hearing on 16 December 2005, from 1 September 2005, if Mr. Justice Hartmann (whose decision is upheld on all appeals) requires an undertaking from the Applicant to pay interest as a condition for continuing the interim stay pending final determination of the application for judicial review (or such time as he may order),

AND in the event that Mr. Justice Hartmann refuses to continue the interim stay (which is upheld on all appeals), the Applicant undertakes to pay the Commissioner damages by way of loss of interest, at an interest rate to be determined by Mr. Justice Hartmann (which is upheld on all appeals) between 1 September 2005 and the date of payment of the Government rent pursuant to the 1^st and 2^nd Demand Notes.