Lui Yuk Yin v. Lam Chuen and Another

DCCJ 1178/2005

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 1178 OF 2005

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BETWEEN

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Coram : Her Honour Judge C.B. Chan in Chambers

Date of Hearing : 5^th January 2006

Date of Handing down of Decision : 1^st March 2006

DECISION

1.This is an appeal against the order made by Master S.T. Poon on 2 December 2005 in which the Master ordered the following:-

(a)   The application to join Lam Hon Yin as the 3^rd Defendant to the above captioned proceedings be dismissed;

(b)   Costs be to the Defendants and Lam Hon Yin.

2.The Plaintiff’s application for a joinder of Lam Hon Yin was made pursuant to Order 15 rule 4 (2), Rules of the District Court (Cap. 336H) (“RDC”).  Further or alternatively, this Court is asked to exercise its discretion under Order 15 rule 6 (2)(b)(i) RDC.

3.The Plaintiff seeks in this appeal the following Order:

(a)   the order of Master S.T. Poon given on 2 December 2005 be set aside;

(b)   leave be granted that Mr. Lam Hon Yin be joined in this action as the 3^rd Defendant; and

(c)   costs of the appeal and the Summons dated 2 November 2005 be to the Plaintiff in any event.

4.Appeal of a Master’s order is by way of re-hearing.  I shall set out the background of the case. 

Background

5.The 1^st and 2^nd Defendants are the parents of Lam Hon Yin (“Lam”) and Lam is the husband of the Plaintiff.  There is a pending divorce action between the Plaintiff and Lam under the action number FCMC 1426/2005.

6.The Plaintiff took out the current proceedings against the 1^st and 2^nd Defendants seeking a declaration that the property at Flat 2, 10/F, Block D, Chung Ming Court, 1 Po Shun Road, Tseung Kwan O, Sai Kung, New Territories, Hong Kong (“the Property”) registered in the name of the Defendants is held on trust for the Plaintiff and Lam as beneficial joint tenants.

7.The current action was commenced before Lam filed his Form E Financial Statement (“Financial Statement”) to the Family Court, in which he did not declare his beneficial interest in the Property.  Lam, through his legal representatives on 2 separate occasions, denied having such an interest in the Property.

8.The Plaintiff’s Statement of Claim in respect of the current action was filed on 27 June 2005 in which the Plaintiff claims, inter alia, the following (as is relevant to Lam):

(a)    There was an agreement between the Defendants, Lam and the Plaintiff in which the parties agreed:

(i)   Lam and the Plaintiff would be the beneficial owners of the Property as joint tenants;

(ii)  Lam and the Plaintiff would make payments towards the purchase price of the Property;

(iii) The Defendants would transfer the legal title in the Property to Lam and the Plaintiff;

(iv) The Defendants would execute a will devising the legal title in the Property to Lam and the Plaintiff.

(b)  Lam and the Plaintiff contributed to the purchase price and expenses on the Property.

(c)  2 mortgages on the Property were taken out by Lam.

(d)  Outgoings of the Property were paid through Lam’s bank account.

(e)  Lam and the Plaintiff incurred expenses for the decoration and furnishing of the Property.

9.Lam did not join in this action as a Plaintiff.

10.The Defendants filed their Defence and Counterclaim on 12 July 2005 alleging, inter alia, the following:

(a)   The Defendants lent Lam a sum of money for the purchase of the property at Flat G, 20/F, Blk 6, Hong Kong Garden (Phase 1), No. 100, Castle Peak Road, Tsing Lung Tau, New Territories, Hong Kong.

(b)   The Defendants gave Lam a sum of $8,000 every month.

(c)   Outgoings and expenses of the Property were in fact paid by the Defendants to Lam.  The expenses relating to decoration and furnishing of the Property were in fact paid by the Defendants.

(d)   The Plaintiff and Lam agreed to take care of the Defendants and the Defendants in turn agreed to execute a will to devise the Property to the Plaintiff and Lam.

(e)   The Defendants attempted to transfer the Property to Lam so that he could apply for a car park space.

(f)   The Plaintiff and Lam procured by misrepresentation the signature of the Defendants on the form entitled “Application for Transfer of Ownership”.

(g)   The Defendants counterclaims that the Plaintiff, through Lam, alleged the Plaintiff was indebted to her sisters and subsequently the Plaintiff borrowed a sum of $100,000.  The Defendant claims that this loan has not been repaid.

11.The Plaintiff filed a Reply and Defence to Counterclaim on 10 August 2005 in which the Plaintiff claims, inter alia, that the $100,000 was given by the 1^st Defendant to Lam to settle debts of the other children of the 1^st Defendant.

Order 15 Rule 4(2) RDC

12.The Plaintiff’s application is based on this rule, which states:

“(2) Where the plaintiff in any action claims any relief to which any other person is entitled jointly with him, all persons so entitled must, subject to the provisions of any written law and unless the Court gives leave to the contrary, be parties to the action and any of them who does not consent to being joined as a plaintiff must, under this paragraph, be made a defendant.”

13.It is clearly the case as disclosed in the Affirmation of Cheng Woon Sun, that Lam does not consent to being added as a Plaintiff to the action since Lam is denying his interest in the Property and during the hearing of the application for joinder, Lam’s legal representatives contested the application and continue to do so.

14.The Plaintiff is seeking a declaration that Lam and the Plaintiff have a beneficial interest in the Property as beneficial joint tenants.  In effect it is the Plaintiff’s case that she and Lam are entitled to the same beneficial interest as joint tenants.  The Plaintiff’s Counsel submits that the nature of a joint tenancy is such that the individual interest is indivisible and held by each party “per mie et per tout” (by half and by whole).  The beneficial joint tenancy is therefore an interest, which is shared in its entirety by the Plaintiff and Lam so that both parties are entitled to the relief claimed.  It is clear that Lam did not want to claim the said interest and denied the said interest.  

15.The Plaintiff’s Counsel also submitted in reliance of Meadows Indemnity Co. Ltd. v The Insurance Corporation of Ireland Plc and International Commercial Bank Plc [1989] 2 Lloyd’s Rep 298 that “the jurisdiction of the Court to grant a declaration was limited to declaring contested legal rights subsisting or future of the parties represented in the litigation before it and not those of anyone else”.  

16.The Counsel for Lam submitted that the jurisdiction of the Court as stated in the Meadows Indemnity Co. Ltd case to grant a declaration was limited to declaring contested legal rights, subsisting or future, of the parties represented in the litigation before it and not those of anyone else.  He submits that there is no contested legal right between Lam and the Defendants.  Hence the Court could not be asked to make a declaration related to any interest of Lam, as he does not contest any legal right as against the Defendants.  Lam’s Counsel relies on the authority of Roche v. Sherrington & Ors [1982] 1 WLR 599 to support his submission that even if Lam was prima facie jointly entitled with the Plaintiff to any relief to which Lam might be entitled in respect of the Property, as there is sufficient evidence that Lam claims no beneficial interest in the property leave should be refused to join Lam as a defendant to the proceedings under O15 Rule 4(2).

Finding

17.Vol 39(2) Halsbury’s Law of England Fourth Edition (Reissue) on Real Property state at para 194 headed “Incidents of joint tenancy as regards interests of joint tenants” state,

“From the fact that each joint tenant is seised of the whole . . . it follows that in actions as to the joint estate one joint tenant may not sue or be sued without joining the others…”

18.The case referred to in that passage is Williams v British Gas Corporation 1980 41 P & CR 106 Lands Tribunal.  In that case the Claimant filed an action against the Defendant for compensation against the Defendant related to damage to land, which he owned jointly with his wife.  The Defendant contended that the Claimant had no locus standi to commence or maintain proceedings unless the Claimant’s wife was joined.  It was held by the Tribunal that,

“the Claimant had no locus standi to commence or maintain the proceedings unless his wife was joined with him as claimant, for, although as between themselves, joint tenants (and therefore joint owners) they had separate rights, as against everyone else they were in the position of a single owner.  Apart from equitable remedies inter se, one joint tenant could not commence proceedings without the aid of the others. . .The notice of reference must therefore be struck out, unless the Claimant’s wife was joined with him as Claimant.”  

19.In para 193 headed “Nature of joint tenants’ interests” in the same Vol. of Halsbury’s Law of England, it states,

“Each joint tenant has an identical interest in the whole land and every part of it.  The title of each arises by the same act.  The interest of each is the same in extent, nature and duration ...  none holds any part to the exclusion of the others ...  These are the four unities of title, interest, possession and time”

20.From the aforesaid, it seems that Lam, the other joint tenant has to be joined as co-Plaintiff of the action because of their identical interest in the whole land and every part of it.  Where they are not agreed as regards their beneficial interest or agreed in taking the action, to obtain a declaration of their right, the authority of Williams v. British Gas Corporation show that the Plaintiff has no locus standi to commence or proceed the action.  In my view, it is doubtful whether the Plaintiff would gain locus standi by the adding Lam, the other joint tenant as a Defendant and not as Plaintiff in view of the fact that interest of the two joint tenants are united as to interest, title and time so that they have to file the claim jointly as Plaintiffs.   For, although as between themselves, joint tenants (and therefore joint owners) had separate rights, “as against everyone else they were in the position of a single owner”.  Further, as Lam is not agreed in relation to their beneficial interest, it seems to me that the Court has no jurisdiction to make a declaration of right related to joint owners one of whom is unwilling for the Court to make such a declaration and further does not contest that he has such a beneficial interest or that he has such a legal right as against the Defendants.

21.On the basis of the principle cited in Meadows Indemnity Co. Ltd. that the jurisdiction of the Court to grant a declaration under Order 15 Rule 16 was limited to declaring contested legal rights, subsisting or future, of the parties represented in the litigation before it and as there is no contest by Lam that he has a legal right, as against the Defendants in the action, I am of the view that the application of the Plaintiff to add Lam as a Defendant should be refused both under Order 15 Rule 4(2) and under Order 15 Rule 6 (2)(b)(i) of the Rules of the District Court.  Further, Lam should not be added as a Defendant as his interest and title in the Property together with that of the Plaintiff is regarded as that of a single owner.  His co-operation and joinder in the action as Plaintiff is necessary before the Plaintiff has locus standi to take this action. 

22.The Appeal be dismissed with an order nisi for costs of the application to Lam Hon Yin and the 1^st and 2^nd Defendants to be paid by the Plaintiff to be taxed if not agreed with Certificate for Counsel.  

Representation:

Miss Ho Wai Yang instructed by Messrs. Alvin Cheng & Rosaline Choy for the Plaintiff.

Mr. Ho Tak Ming of Messrs. Peter K.H. Wong & Co. for the 1^st and 2^nd Defendants.

Mr. K.S. Chan instructed by Messrs. K.Y. Leung & Carina Cheng for Mr. Lam Hon Yin (the intended 3^rd Defendant).