HKSAR v. Vily Field Investment Ltd

Read the full judgment text of HCMA 1011/2006 on BabelCite. This High Court CFI judgment was delivered on 7 August 2007.

1. The appellant company was convicted, after trial, on a summons which alleged that they had between the 13 th of October 2005 and the 10 th of February 2006, after being served with a notice (P28) in CEP/E/YL-NSW/160 dated 13 of July 2005 under section 23(1) of the Town Planning Ordinance, Cap. 131, had failed to comply with the said notice, in that the relevant matters had not been discontinued as required by the notice.  The appellant company now appeals against that conviction.

Cited by 3 cases · Cites 3 cases

Case No.HCMA 1011/2006
Court
High Court CFI
Date07 Aug 2007
Judge
Case Document
100%Judiciary

HCMA 1011/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MAGISTRACY APPEAL NO. 1011 OF 2006

(ON APPEAL FROM STS 2146/2006)

______________________

BETWEEN

  HKSAR Respondent
  and  
  VILY FIELD INVESTMENT LIMITED Appellant

______________________

Before : Deputy High Court Judge E Toh in Court

Dates of Hearing : 14 February 2007, 15 June 2007

Date of Judgment : 7 August 2007

______________________

J U D G M E N T

______________________

1.The appellant company was convicted, after trial, on a summons which alleged that they had between the 13th of October 2005 and the 10th of February 2006, after being served with a notice (P28) in CEP/E/YL-NSW/160 dated 13 of July 2005 under section 23(1) of the Town Planning Ordinance, Cap. 131, had failed to comply with the said notice, in that the relevant matters had not been discontinued as required by the notice.  The appellant company now appeals against that conviction.

2.The prosecution case was largely unchallenged and the facts were admitted under section 65C of the Criminal Procedure Ordinance as Exhibit P1.

3.The relevant site is located at Lots No. 3720s.Dss.5 (part) and 3720s.DRP (part) in DD 104, Nam Sang Wai, Yuen Long, New Territories.  On the 17 August 1990, a notification was published in the Government Gazette in respect of the Nam Sang Wai Interim Development Permission Area (“IDPA”).  Although the site was not designated for any specified use, the parking of vehicles was not a permitted use on the plan (see Exhibit P4).

4.On the 18 of August 1990, two aerial photographs were taken by the Lands Department and these were produced as Exhibits P25A, P25B and P25.  And these photographs reflected the condition of the material site at the time.  Subsequently, the appellant obtained possession of the material property and assigned part of it to Trans-Island.

5.In 1991 on the 12 of July, another notification was published in the Government Gazette in respect of the draft Nam Sang Wai Development Permission Area (“DPA”), and the material site fell within the “unspecified use” area on the DPA plan and again parking of vehicles was not a permitted use on the plan (Exhibit P6).

6.PW1, a Survey Officer of the Planning Department inspected the relevant site on the 14 of October 2005 and took photos (Exhibit P40).  He said that the site was fenced off with wire mesh and metal sheets along the perimeter, and he found that there were about 28 vehicles parked on the site, including tractors, trailers with containers, private vehicles and lorries.  At about 2 pm on the 13th of December 2005, he visited the site again and found about 19 vehicles there (see Exhibit P41).  He went to the site again on the 9th of February 2006, and found 25 vehicles there (see P42).

7.PW2, a Surveyor of the Planning Department, gave evidence as an expert witness.  He examined the aerial photograph taken on 2 June 1988 (P23) and in his opinion, the site was used for the following purposes:

(1) a vehicular access;
(2) open storage of abandoned objects; and
(3) informal parking of a small number of vehicles.

And he could see from the photograph that the site was not fenced off.  He further examined photographs taken in 1989, Exhibit P24, and in August 1990, Exhibit P25, and concluded that the site was still used for the same purposes as before.  By 1991, Exhibit P26, he discovered that a gate had been installed to the east of the vehicular access at Kam Pok Road, and a fence had been erected along the northernmost perimeter, but the site still served as a vehicular access and an open storage of a small quantity of objects.  When he examined P27 which was taken in June 1994, PW2 found that the vehicular access was relocated to the southernmost part of the site.  The area was completely fenced off and the gate to the east was still in existence.  He found many trailers on the site and that the site served as a parking area mainly for container vehicles.  By October 2005 (see P28), PW2 saw a number of containers, trailers, container vehicles, private vehicles, etc on the site.  Most of the previous grassland had been cleared and the ground had been levelled and paved.  When he compared P25 taken in 1990 with P28, PW2 said that the site had been changed to a parking area.

Defence case

8.DW1 was the owner of the nearby ponds, and the material Lot No. 3720 used to be ponds but he filled them in 1983 and let out the land for parking and storage purposes.  On the 24 of May 1990, he assigned to the appellant company his interests in the land together with some existing tenancies (see Exhibit D1).  DW1 pointed out that this site was included in the lease to Trans-Island Limousine Co though it was not explicitly stated to be so.  And it is his evidence that he had seen Fairview Park coaches parked on the site after 9 pm but they left after 6 am, and there were normally about 20 of those coaches.

9.DW2 was the appellant company’s manager.  His evidence was that the assignment from DW1 to his company was subject to existing tenancies.  He said vehicles were parked on the material site only after 5 pm or 6 pm and he said that the land leased to Trans-Island did include the relevant site and there was a mistake in the wording in the deed which was exhibited as Exhibit D1.  He said that he seldom visited the site and agreed that the licence agreement, Exhibit D6, had stated clearly that the purpose of the land was “for parking and storage of vehicles only”.

Magistrate’s findings

10.The learned Magistrate found as a fact that the licence agreement made by the appellant company with Trans-Island did cover the subject site.  And that after considering Exhibit D6 and the aerial photos P27 and P25, the learned Magistrate was satisfied that in 1990 the relevant site mainly served as a vehicular access with an open storage and some coaches were temporarily parked there at night, although in no systematic or orderly manner.  And the learned Magistrate considered that such parking was merely of a “temporary, transient and mobile nature”.

11.The learned Magistrate, properly, pointed out that he had to consider the use of the site in question on two dates.  The date of gazetting, i.e. 17th of August 1990, and the period of contravention as stated in the summons, i.e. between the 13th of October 2005 and the 10th of February 2006.  He found that following the principle laid down in Way Luck Industrial Limited (1995) 2 HKC 290, that the use of the site had been changed from parking of vehicles on a temporary, transient and mobile basis into a more permanent and regular basis and on a larger scale.  He ruled, therefore, that “there was a material change in the degree of the use of land, which constituted sufficiently, ‘a material change in the use of the land’.”  And the learned Magistrate found that the defence has not on a balance of probabilities established a defence under section 23(9) of the relevant Ordinance.

12.The learned Magistrate also disagreed with the defence submission that section 23(9) of the Town Planning Ordinance was not consistent with the presumption of innocence in the Basic Law and the Bill of Rights following the Court of Final Appeal’s judgment in HKSAR v Lam Kwong Wai FACC 4/2005.  The learned Magistrate distinguished Lam Kwong Wai by pointing out that in Lam’s case, it was a charge of possession of imitation firearm which is a serious crime, and the present case is a summary offence under the Town Planning Ordinance which is deemed to be regulatory in nature rather than a “genuine criminal offence or a contravention involving moral culpability”.  Therefore, the learned Magistrate ruled that that judgment is not applicable in this case.  The learned Magistrate ultimately found that the appellant company had failed to comply with the notice, Exhibit P36, and therefore found the appellant company guilty as charged.

Appeal

13.Mr Pang for the appellant submitted the following grounds of appeal:

(1) The learned Magistrate, having accepted that prior to the 17th of August 1990, the site was used for parking of tour buses at night, erred in:
  1.1 finding such use was temporary, short-term and impermanent; and
  1.2 not differentiating “mere intensification “ and “material change” in the use of the land;
  therefore erred in finding that the defendant had failed to prove on a balance of probabilities the defence under section 23(9)(b) of the Town Planning Ordinance, Cap. 131, in that such use existed immediately before publication of the notice of the relevant plan of the interim development permission area. 
(1A) The learned Magistrate failed to give any weight to the planning unit as a whole in assessing whether there had been material change of use.
(2) The learned Magistrate erred in law in finding sections 23(9) and 23(9A) of the Town Planning Ordinance did not derogate from the presumption of innocence; he should have found the aforesaid provisions had derogated from the presumption of innocence, and that section 23(9) should be read and interpreted as imposing on the defendant an evidential burden only.
(3) In the circumstances, the conviction was unsafe and unsatisfactory.

Ground 1

14.Under section 21 of the Ordinance:

no person shall undertake or continue development in the development permission area unless:
  (a) the development is an existing use; …”

And under section 1(A), development is defined as:

… carrying out building, engineering, mining or other operations in, on, over or under land, or making a material change in the use of land or buildings.”

And under the same section, “material change in the use of land or buildings” is defined as including:

... depositing matter on land, notwithstanding that all or part of the land is already used for depositing matter, if the area, height or amount of the deposit is increased.”

15.Under section 23, the authority need not prove that its opinion was correct, i.e. that there actually was unauthorised development.  The onus is on the defendant to prove that the “unauthorised development” was not an “unauthorised development”, or was an existing use.

16.The land as described in the summons is marked in red in Exhibit P2.  As pointed out by Mr Pang, if the parking of vehicle was not a material change in the use of the land as it stood when the Interim Development Permission Area plan was first gazetted on the 17 of August 1990, then the appellant would not be guilty.  The arguments of the appellant is that since the land had been used for parking of vehicles prior to the relevant date, the continued parking of vehicle on the land was not an unauthorised development.  However, Mr Pang recognises that intensification of use can result in a material change in the use of the land, and the question is one of degree.  (See Brooks and Burton Limited v Environment Secretary (1977) 1 WLR 1294)

17.It is clear from the aerial photos, firstly in P25 taken in 1990, that there was a dirt road leading from Kam Pok Road on the relevant site to the left of the photograph forking into two smaller roads which led off the property towards the ponds on the left.  In P27 taken in 1994, the dirt roads had been much erased and trailers were parked thereat.  By the time of P28 which was taken in 2005, it appears that all vegetations had been cleared from the relevant site and the site has been paved over and the dirt road leading from Kam Pok Road has disappeared, and the two minor dirt roads which appeared to the left of the site leading towards the ponds, which were apparent in the 1990 photograph, were no longer there.

18.As mentioned above, the learned Magistrate had found that in 1990, the land was mainly used for vehicular access with a little open storage and light coaches were parked there, which the learned Magistrate found to be “temporary, short-term and impermanent”.  The learned Magistrate found that by October 2005, the relevant land had been enclosed by 2-meter high fence, grass had been removed and the whole land had been levelled and paved, there was lighting and a converted container was placed at the entrance, and some 19 to 28 vehicles were parked there.  Therefore the learned Magistrate considered that there has been a material change of use.

19.Mr Pang criticised the learned Magistrate for giving no reasons as to why he considered that the parking of the coaches on the land in 1990 was “temporary, short-term and impermanent”.  The evidence of the defence witnesses was that coaches from Fairview Park, an estate nearby, had used the subject land for parking of their coaches in the night and leaving at 6 am every day.  As can be seen from the aerial photographs and the evidence of the prosecution witnesses, who had observed and gone to the site, it is clear that the land since 1990 had been cleared, levelled and paved over, and turned into what appears to be a permanent parking area.  It was surrounded by a fence and there was lighting, around the site with a gate at the entrance.  Obviously when the learned Magistrate found as a fact that there was a material change in use, he is entitled to do so.  By any standards, there was an intensification of use to such an extent that it had become a material change in the use of the land.  Upon a reading of the learned Magistrate’s Statement of Findings, it is clear that the learned Magistrate found as a fact that in 1990, the land was used for parking on a “temporary, short-term and impermanent” basis but by October 2005 (see P28) the land was used for permanent and regular parking of vehicles of some scale and therefore there had been a material change of use.  It is clear that the learned Magistrate meant that the degree of the intensification of the use had materially changed the use of the land.

20.Mr Pang then criticized the learned Magistrate for failing to give any weight to the planning unit as a whole in assessing whether there had been a material change of use.  He then cited the case of Burdle v Secretary of State for the Environment (1972) 1 WLR 1207.  Bridge J at page 1212 said this:

What, then, are the appropriate criteria to determine the planning unit which should be considered in deciding whether there had been a material change of use?  Without presuming to propound exhaustive tests apt to cover every situation, it may be helpful to sketch out some broad categories of distinction.
  First, whenever it is possible to recognise a single main purpose of the occupier’s use of his land to which secondary activities are incidental or ancillary, the whole unit of occupation should be considered. …
  But, secondly, it may equally be apt to consider the entire unit of occupation even though the occupier carries on a variety of activities and it is not possible to say that one is incidental or ancillary to another.  This is well settled in the case of a composite use where the component activities fluctuate in intensity from time to time, but the different activities are not confined within separate and physically distinct areas of land.
  Thirdly, however, it may frequently occur that within a single unit of occupation two or more physically separate and distinct areas are occupied for substantially different and unrelated purposes.  In such a case each area used for a different main purpose (together with its incidental and ancillary activities) ought to be considered as a separate planning unit.
  To decide which of these three categories apply to the circumstances of any particular case at any given time may be difficult.  Like the question of material change of use, it must be a question of fact and degree. …  It may be a useful working rule to assume that the unit of occupation is the appropriate planning unit, unless and until some smaller unit can be recognised as the site of activities which amount in substance to a separate use both physically and functionally.”

21.It is clear from the evidence in this case that parking of vehicles on the subject site was never a permitted use of the site.  The learned Magistrate was well aware that the subject land had been used both for temporary parking and storage purposes, and also for accessing other surrounding areas in 1990.  However, by the time of the period covered by the summons, it was clear that the land was no longer used as an access road to other sites in the area but had been surrounded by a metal fence with an access gate on Kam Pok Road and the area paved over.  So I do not, under the circumstances, consider that the learned Magistrate has failed to consider the whole of the site as a planning unit.  It is also clear that the use of the site for parking of vehicles had overtaken and almost completely obliterated the other uses which were for access and storage of goods.

22.I therefore find that the learned Magistrate was correct in finding that there was a material change in the use of the land.  And ground 1 fails.

Ground 2 – reverse onus

23.Section 23(1) of the Ordinance states:

(1) Where, in the opinion of the Authority, there is or was unauthized development, the Authority may, in a notice served on one or more of a land owner, and occupier or a person who is responsible for the relevant matters –
    (a) specify the relevant matters; and
    (b) specify a date by which the Authority requires the relevant matters to be discontinued, if they have not by then been discontinued.”

24.Section 23(9) reads:

It is a defence to a prosecution under subsection (6) and in a proceeding to recover expenses under subsection (8) if the defendant proves that –
    ….
  (b) the unauthorized development which existed according to the opinion of the Authority in fact was an existing use or, in the case of land within an interim development permission area, that the use of a building or land was in existence immediately before publication in the Gazette of the notice of the relevant plan of the interim development permission area;”

25.Then in section 23(9A) reads:

In the prosecution of an offence alleged to have been committed under subsection (6), it shall not be necessary for the prosecution to prove that –
  (a) the unauthorized development which existed according to the opinion of the Authority in fact was a development or was an unauthorized development; or
  (b) the relevant matters which constituted such unauthorized development according to the opinion of the Authority in fact constituted such unauthorized development.”

26.Mr Liu on behalf of the respondent prays in aid the words of Litton JA (as he then was) in R v Tang Ying Yip & Anor (1995) 2 HKC at page 283I:

Plainly, the policy behind section 23(1) is to encourage vigilance on the part of land owners.  Section 23(9)(a) provides a land owner, facing a prosecution under sub-section (6), with a defence if he proves that it took all reasonable steps in the circumstances to comply with the enforcement notice.  Thus, the ‘blameless’ land owner would generally have a defence; that it would be for him to come forward to explain how the unauthorized development came about.  There is nothing oppressive about this since the facts would be within his means of knowledge rather than that of the Planning Department.
  The statute with which I am concerned in these appeals deals with issues of social concern.  Whilst the means of compliance with the statutory objectives is through the criminal justice system, nevertheless, criminal intent is not an inflexible ingredient: the presumption of the criminal law that mens rea must be present can, in cases such as these, be displaced: see R v Collett [1994] 1 WLR 475 at 484H.”

27.Mr Pang, however, argues that the statutory defences provided for in section 23(9), except for section 23(9)(a), are not true defences and are in fact essential elements of the offence.  And therefore it is clearly in breach of the Bill of Rights Ordinance and the Basic Law.  And in support of his argument, Mr Pang cites the case of AG v Lee Kwong Kut (1993) 2 HKCLR 186 which was a case on appeal to the Privy Council in which the respondents were alleged to have cash which had reasonably been suspected of having been stolen or unlawfully obtained under section 25 of the Drug Trafficking (Recovery of Proceeds) Ordinance, Cap. 405.

28.Mr Pang prays in aid the words of Lord Woolf at page 197 line 35:

Some exceptions will be justifiable, others will not.  Whether they are justifiable will in the end depend upon whether it remains primarily the responsibility of the prosecution to prove the guilt of an accused to the required standard and whether the exception is reasonably imposed, notwithstanding the importance of maintaining the principle which Article 11(1) enshrines.  The less significant the departure from the normal principle, the simpler it will be to justify an exception.  If the prosecution retains responsibility for proving the essential ingredients of the offence, the less likely it is that an exception will be regarded as unacceptable.  In deciding what are the essential ingredients, the language of the relevant statutory provision will be important.  However what will be decisive will be the substance and reality of the language creating the offence rather than its form.  If the exception requires certain matters to be presumed until the contrary is shown, then it would be difficult to justify that presumption unless, as was pointed out by the United States Supreme Court in Leary v United States (1969) 23 L Ed 2d 57, 82 “it can at least be said with substantial assurance that the presumed fact is more likely than not to flow from the proved fact on which it is made to depend.”

29.Further, Mr Pang also relies on the case of Lam Kwong Wai (2006) 3 HKLRD 808, which was a case involving the Firearms and Ammunition Ordinance, Cap. 238.

30.This court agrees with Mr Liu that the present offence is not “truly criminal” in character and the statutory defences are available to both criminal prosecution under sub-section (6) and civil proceedings under sub-section (8).  And that section 23(6) is an offence of absolute liability and mens rea need not be proved by the prosecution.  It is clear from a reading of the defences provided in section 23(9)(b) that the defendant had to prove on a balance of probabilities that the unauthorized development was an existing use or in the case of land within an interim development permission area, that the use of a building or land was in existence immediately before publication in the Gazette of the notice of the relevant plan of the interim development permission area.

31.Thus, where the defence is raised by the defendant that the use of the subject land was an existing use before publication of the Gazette, then the prosecution still has to prove by means of aerial photographs and the evidence of the expert witness in this case that the use of the land had materially changed.

32.In his Statement of Findings, the learned Magistrate, after referring to the prosecution evidence in the form of aerial photographs and expert evidence, at paragraph 19, said this:

After considering all the circumstances of this case, I find that the Defence has not, on a balance of probabilities, established the defence under section 23(9) of the relevant Ordinance.”

33.The learned Magistrate went on to find that the case of HKSAR v Lam Kwong Wai, FACC 4/2005 was not applicable in this case because that case concerned a serious criminal offence, whereas the present offence before him was regulatory in nature rather than a genuine criminal offence or a contravention involving moral culpability.  The learned Magistrate therefore ruled that the provisions in question are not inconsistent with the presumption of innocence.

34.Sir Anthony Mason NPJ at Paragraph 46 in Lam Kwong Wai said:

A statutory provision is not automatically open to challenge under the BOR simply because the provision creates an offence of absolute or strict liability.  There is strong authority for this proposition, including AG of Hong Kong v Lee Kwong-kut at page 975D, per Lord Woolf; AG & Anorv Fong Chin Yue & Oths [1995] 1 HKC 21 at page 28F, per Bokhary JA (as he then was); So Wai Lun v HKSAR [2006] 3 HKLRD 394.  This view, which necessarily applies with equal force to the Basic Law, is entirely consistent with the principles stated in Salabiaku v France (1988) 13 EHRR 379 and the way in which these principles have been applied.”

35.I agree with Mr Liu that the persuasive burden cast on the defendant to prove existing use is not a particularly onerous one as he must have known the condition of the land at the relevant time in 1990 and the degree of the material change in use at the relevant time covered by the summons.  As Litton JA (as he then was) had pointed out, these regulations are a matter of social concern and therefore the burden on the defendant to prove on a balance of probabilities that there had been no material change in the use of the land does not prevent the defendant from receiving a fair trial.  This appeal is therefore dismissed.

36.But before closing, I would like to express this court’s gratitude to both counsel for their cogent and well-prepared submissions in this case.

(E Toh)
Deputy High Court Judge

Mr Liu Yuen Ming, Senior Government Council, for the Respondent

Mr Robert Pang and Miss Pauline Leung, instructed by Messrs Chow, Griffiths & Chan, for the Appellant