Secretary for Justice for and on behalf of the Commissioner of Police v. Robinson, Alan Huntly and Another

DCMP 1376/2006

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 1376 OF 2006

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Coram: H.H. Judge Chow

Hearing date : 9^th – 11^th October, and 13^th December 2007

Date of handing down Decision :   10^th March 2008

Decision

1.On 9^th May 2006, the Applicant issued the present interpleader proceedings in which the Plaintiff and the Defendant are to state the nature and particulars of their respective claims regarding the ownership of a vehicle now bearing registration number LR 3055 (formerly HK 1090) (“the Vehicle”).

Background

2.In 1981, the Plaintiff purchased the Vehicle in Hong Kong, which was bearing registration mark HK 1090.  In September 1994 he crashed the rear part of the Vehicle.  It was towed to the garage of Tang Shiu Kong (“Tang”) for repair.  Later on the Plaintiff also took some parts to Tang for replacement purpose in the Vehicle.  In or about May 1995, the Plaintiff handed over to Tang a cheque of $15,000 and some documents which included a certificate of pass of vehicle examination, vehicle registration document of the Vehicle, documents of classic cars’ association and a movement permit of the Vehicle.

3.The repair work continued in mid-May 1995, Tang finished the replacements of the parts for the Vehicle.

4.In June 1997, the Plaintiff stopped visiting Tang’s garage, because, inter alias, he thought that the Vehicle was yet unfinished.

5.In late 1998, Tang closed his garage.  He delivered the Vehicle to a Mr. Yiu (“Yiu”) and the Vehicle was stored at Yiu’s garage, but he still kept all the documents of the Vehicle given to him by the Plaintiff.

6.In March 1999, Tang saw another vehicle bearing registration no. of HK 1090 in the street.  He asked Yiu to conduct searches at the Transport Department.  Having conducted such searches, Yiu advised Tang that the mark of the Vehicle had been transferred to another car.

7.In 1999, Lee saw the Vehicle at Yiu’s garage.  He offered to purchase the Vehicle from Yiu at a consideration of $40,000.  Yiu then sold the Vehicle to Lee.

8.In November 2000, the Plaintiff went to Tang’s garage but discovered that it had been closed.

9.In late 2000, when Yiu was hospitalized he told Tang that he had passed the Vehicle to Lee.

10.In 2002, the Defendant and his friend a Mr. Fung (“Fung”) met Lee.  In August 2003 Lee went to the Transport Department and obtained a certificate of vehicle particulars of the Vehicle.  This showed “HG 2850”.

11.In November 2003, the Defendant and Fung saw the Vehicle at Lee’s garage.  The Defendant asked Lee to sell the Vehicle to him.  Lee accepted the offer and agreed to sell the Vehicle to him at $45,000.  In January 2004 the Defendant took possession of the Vehicle and towed it to Fung’s garage.

12.In June/July 2004, Fung received documents from Lee on behalf of the Defendant.  The received registration documents are an “application for registration” form and a “transfer of ownership” form, both made out in the name of Lee.  Then Fung started repairing the Vehicle.

13.In September 2004, the Vehicle passed vehicle road test, and a certificate of roadworthiness was issued.

14.In September 2004, ownership of the Vehicle was transferred from the Plaintiff to the Defendant.  The Vehicle was re-registered as LR 3055 and licensed.

15.In December 2004, the Plaintiff identified the Vehicle from a photograph taken on a drive to China.  He reported to the police the Vehicle as having been stolen.

16.In his second affidavit dated 17^th January 2007 the Plaintiff stated, “I did not sign any blank Transfer of Ownership form and there was no reason for me to do so.  All I had ever intended was for Tang to repair my car and have it returned to me after the repairs were completed.”  The documents he handed over to Tang do not include a transfer of ownership form.  I have no doubt that what he said in this regard is true. 

17.I accept the evidence of the Plaintiff.  He impressed me as a truthful witness.

18.The Defendant’s counsel submitted that section 5 of the Limitation Ordinance (“the Ordinance”) applies to the facts of these proceedings.  Section 5 reads:-

(Underlines provided)

19.The defence counsel submits that pursuant to section 5(1) of the Ordinance, the 6 years time period which allows the Plaintiff to bring an action of conversion by the Defendant would have expired in 2004 or alternatively in 2005, because at the time when the Defendant converted the Vehicle by purchasing it from Lee in January 2004, the Plaintiff had not recovered possession of the Vehicle.  So the 6 years time period for the Plaintiff to bring an action against the Defendant would have started to accrue at the time of the original conversion which would either be in 1998, or alternatively in 1999.  Further according to section 5(2) of the Ordinance, the Plaintiff’s titles to the Vehicle would be extinguished in 2004 or alternatively in 2005 accordingly.  Thus he would not be successful since he no longer has title to it or has the right to claim.

20.The defence counsel refers to the case of De La Rue v Hernu, Person & Stockwell Ltd. [1936] 2 KB 164 (“De La Rue”) at P. 167, namely “An interpleader issue is not an action, but a proceeding in an action”, that the long title of the Ordinance states that it is the law relating to the limitation of actions and arbitrations, and that according to section 2 of the Ordinance, “action” includes any proceeding in a court of law.  Therefore the Ordinance applies to any proceeding in a court of law.  In my judgment, for section 5(1) to apply, the proceedings must involve an “action in respect of the conversion or wrongful detention of a chattel”, as expressly provided by section 5(1).

21.Under section (2)(1), “action” includes any proceeding in a court of law.  Conversion is a tort.  Therefore if section 5(1) is to apply, the proceedings must be founded on tort  in a court of law.  The issue this court has to decide is whether the present proceedings involve an action of tort.  An account of the true nature of an interpleader proceedings was given by the court in De La Rue, at p.172:

“    I venture to think that it could not be suggested that two defendants to a Bill of Interpleader of that kind could be said to be engaged in an action of tort against one another.  They were not.

………………………………

In substance, when an interpleader issue is tried, two actions against the person interpleading are being dealt with.  Interpleader proceedings are the method of compelling the parties-either one, or both, or neither of whom may have actually issued a writ-to prosecute their claims.  As it is the essence of interpleader proceedings that the person who has interpleaded has no title himself he naturally drops out of the suit.  But in effect the entire matter is tried out in the presence of all the parties concerned, and the real claimants are compelled to put forward their claims and have them adjudicated upon.  The reason for that is not their own benefit, it is for the relief of the person interpleading.

When it is once appreciated that that is the true nature and history of interpleader proceedings, I take the view that it is quite wrong to treat an issue directed under the Interpleader Rules as though it were an action of tort.  It is a method to enable the Court to decide the claims between two persons present at the proceedings, and to decide those claims so that the person interpleading will get the relief to which he is entitled.”

22.In these interpleader proceedings the Plaintiff and the Defendant are not advancing an action against each other.  Both claimants are merely putting forward their respective claims, and have them adjudicated upon by this Court, so that the Applicant will get the relief to which he is entitled.

23.By reason of the matters aforesaid, I rule that section 5 of the Ordinance has no application to these proceedings.  There is no issue of time bar adverse to the Plaintiff.  He was and still is the owner of the Vehicle.  The Defendant’s submissions in these aspects must fail.

24.Even if section 5(1) applies to these proceedings, the conversion only commenced after May 2000, as a result of which the interpleader proceedings come within the limitation period.  In his interview record taken by the police on 12 December 2004, Tang said, at p. 11

“…… Adding to it the car [storage] fee in the monthly sum of HK$1,000.00 for the period from May 1995 to May 1999 and HK$300.00 for the period from May 1999 to May 2000 totalling HK$51,600, [he] owed me a total sum of HK$78,434.00 …………. Until late 2000, Yiu Chen Keung was hospitalized as a result of traffic accident.  When I paid a visit to him, during [our] conversation, he said that [he] had exchanged HK 1090 with the car of Lee Chung Kwong.  As I admitted that I still owed Yiu Chen Keung the car [storage] fee of the car, I did not ask for details.  Neither did I get the money back from him. [The money] could well clear the [storage] fee……..”

Thus the storage charge was calculated up to and including May 2000.  Up to this time there could not be any conversion by Yiu, because Yiu was storing the Vehicle for Tang.  In his interview record with the police dated 8 December 2004 Lee said that:-

“This Trimph car is bought by me 4 years ago.  I do not recall whether the exact year is 2000 or 1998 or 1999.”

His memory in this regard is not reliable.  There is no documentary evidence to record the transaction.  The onus is on the Defendant to prove that the conversion took place outside the 6 years time limit.  It has failed to do so.

Detinue

25.The Defendant submits that although he has detained the Vehicle against the demand of the Plaintiff and has refused to return upon the Plaintiff’s demand, the Plaintiff’s claim of detinue must fail because he does not have the immediate right of possession of the Vehicle.  The reason is that after Tang had completed the repair for Robinson in 1995, he had only paid $15,000, but not the balance of the repair costs, which amounted to HK$20,834 for the damaged rear part of the Vehicle, and the subsequent labour costs of HK$6,000 for the replacing of parts in the Vehicle.  As a result, there was a workmen’s lien held by Tang over the Vehicle in 1995.  In fact, even until the present the Plaintiff still owes Tang the balance of the repair cost and the labour cost.  The Plaintiff does not have the immediate right to possession out of the proprietary interest of the Vehicle both in 1995 and at present, due to the workmen’s lien held by Tang.  Thus, the Plaintiff does not have the right to claim an action of detinue and he does not have the right to demand the return of the Vehicle from the Defendant.  In my judgment as between the Plaintiff and the Defendant the issue of detinue does not arise, because the Plaintiff only placed the Vehicle with Tang for repair work to be done.  There is no bailment between the Plaintiff and the Defendant.  It follows that there is no issue of detinue between the two of them.  Further, the repair cost and labour cost, if any, were owed to Tang.  The enforcement of these debts, if any, remains with Tang.  Tang has not assigned those rights to the Defendant.  Tang did not make any claim of detinue against the Plaintiff in a court of law.  Therefore the Defendant does not have the right to ask the Plaintiff for payment of those debts, if any.  In the premises, the defence submission in this regard cannot stand.

Unjust enrichment

26.The Defendant submits that according to the decision in Greenwood v Bennett [1972]3 WLR 691, the Plaintiff is to compensate him for the work done on the improvement of the Vehicle.  He submits that he paid a total of $80,000 to Fung for the repair, restoration, purchase of parts, and arranging for vehicle examination of the Vehicle.  He said he still owes Fung $70,000.  He produced a quotation (Exhibit WN-1), which is undated to support his allegation.  He submits that he has spent a total of $150,000 on the improvement of the Vehicle.  Fung admitted that the Defendant had actually prepared the document after Fung had given him a piece of his letterhead.  This is inconceivable.  It is Fung who did the repair work.  It is he and not the Defendant who should have determined the charges to be imposed.

27.The Defendant says that when he just saw the Vehicle, it was basic frame and machinery.  To what extent did he do the repair work?  In his statement to the police (dated 12 December, 2004) Tang said at page 9 that the repair work on the Vehicle had been finished.  This implies that the Vehicle was ready to be collected.  On page 5 of his statement to the police (8 December 2004) Lee said that some work was required to be done to make the Vehicle drivable.  He repaired the Vehicle and it could be driven.

28.In his statement dated 12 December 2006 the Defendant said that he had paid a total sum of $80,000 to Fung for the purchase of parts, repairing and restoring charges, and for arranging vehicle examination.  He did not mention that he had not paid Fung in full.  But on 5 July, 2007 he said that the amount payable is $150,000.  He had only paid $80,000.  So he still owes Fung $70,000.  By 12 December 2006, the Vehicle had been repaired a long time ago, and Fung would have told the Defendant the total sum for the repair, and it is only natural that the Defendant would have mentioned $150,000 in his statement dated 12 December 2006.  But he has failed to do so.  I find that the Defendant’s evidence is incredible.  I do not accept his evidence in this regard.

29.The Plaintiff submits that the “repair works” did not improve the value of the Vehicle, but have actually diminished it.  He said that the “repair works” carried out on the Vehicle were of poor quality, and not in line with the Vehicle as a classic car.  The repair work done has actually diminished the value of the Vehicle.  He identified some “repairs” of the Vehicle which were dangerous and illegal.  He will have to spend a substantial amount of money to rectify the repair works and restore the Vehicle to its original state.  This is supported by the contents of his 4^th affidavit dated 31 August 2007.  I accept his evidence in this regard.

30.Tang did not have any title of the Vehicle.  So Yiu could not get any title of the Vehicle from him.  That being the case, he could not have lawfully sold the Vehicle to Lee, who in turn could not have passed any title of the Vehicle to the Defendant.  There is no claim of any title to the Vehicle put forward by the Defendant, and there is no evidence that the Defendant has obtained any title to the Vehicle.  On the other hand the Plaintiff remains the owner of the Vehicle.

31.By reason of the matters above-said, I adjudge that the Plaintiff succeeds in his claim to the Vehicle, and the Defendant’s claim fails.   I make a declaration that the Plaintiff is the owner of the Vehicle now bearing registration number LR 3055, and accordingly he is entitled to the return of the Vehicle by the Police.  The Defendant is not the owner of the Vehicle.  I dismiss his claim for the return of the Vehicle by the Police, and I also dismiss his claim for compensation for the work done by him on the Vehicle.

Costs

32.I make an order nisi, to be made absolute in 14 days’ time, that the Defendant is to pay costs of these proceedings to the Plaintiff, and to the Applicant, to be taxed, if not agreed.

The Applicant:      represented by M/S T.S. Tong & Co., Solicitors, absent.

The Plaintiff :        represented by Mr. Damien Laracy of Messrs. Laracy Gall, Solicitors.

The Defendant:    represented by Mr. Alexander Cheung/Ms. Phyllis To instructed by Messrs. Cheng, Chan & Co., Solicitors.