Attorney General v. Fung Kam-chuen

CACC000624/1982

Breach of condition in termination of tenancy under court order - section 53(7B) - Order for possession of premises to which Part II Landlord and Tenant (Consolida- tion) Ordinance applies can only be made only if judge is satisfied that one of the statutory requirements under section 53(2) complied - Consent Order even if silent on the point should be considered in that light - Whether consent order was made as result of concession by tenant that statutory requirement having been complied is a matter to be decided by looking at all circumstances of the case and decided by the judge - Case of The Queen v. Leung Len Fung-ming wrongly decided on that point - in the circumstances of present case respondent has case to answer.

BETWEEN

Coram: Li, Cons & Yang, JJ.A.

Date: 4 August 1982

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JUDGMENT

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Li, J.A.:

1. The respondent was a registered owner of a flat in the Man Wah Building known as 10 Man Wui Street, 6th floor (the suit premises) which was let to a tenant, LUI Bing-nam (PWI) for domestic purposes. As such Part II of the Landlord and Tenant (Consolidation) Ordinance (the Ordinance) applied to the suit premises. On the 10th of October 1979, the respondent issued a writ to claim possession of the suit premises from PW1 on the ground that he required the suit premises for his own occupation. The respondent later found that there were two persons who claimed, to be the sub-tenants of the suit premises. By an amended writ issued on the 2nd April, 1980, he cited the other 2 persons as 2nd and 3rd defendants and claimed for possession against them as well on the same ground.

2. Eventually, the case was set down for hearing before Judge Blackwell on the 1st September, 1980. By that time, the parties agreed to settle the action. Both the respondent and PW1 were legally represented. The terms of settlement were explained to and understood by the 2 other defendants who appeared in person.

3. The terms were signed by all parties concerned and made an order of the court. They read as follows:

4. Having obtained possession pursuant to the consent order, the respondent sold the suit premises to a third party for $597,500 by assignment dated the 16th of January, 1981. A charge was preferred against the respondent for breach of condition in a termination of the tenancy agreement under a court order contrary to section 53(7B) in Part II of the Landlord and Tenant (Consolidation) Ordinance. At the hearing on the 22nd of March, 1982, the trial judge held that the respondent had no case to answer on the ground that the consent order, by which possession was granted to the respondent, was silent as to the statutory basis upon which it was made and was not expressed as having been made under section 53(2)(b).

5. The Attorney General, not being satisfied with the decision, applied for a case stated. Hence this appeal.

6. The question we are asked to consider are 3 in number. Basically there is only 1 question of law, namely whether the trial judge should have been satisfied that the order for possession in the civil action was an order made pursuant to section 53(2)(b) of the Ordinance, Cap. 7.

7. Both counsel for the Crown and counsel for the respondent agree in the outset that on the face of it the order made in the civil action is not a valid order of the court. Both agree that having regard to the provisions in section 53(2) as a whole, a district judge sitting in civil jurisdiction may not give judgment for possession by consent unless the judge is satisfied that at least one of the statutory requirements in section 53(2) has been met. It is agreed that the parties to a civil action cannot give the court jurisdiction by consent where there is none.

8. Where counsel part company is that each takes a different slant in his argument and gives a different interpretation of the said order made by Judge Blackwell.

9. Mr. Barlow contends that the apparently invalid order is in fact valid on the presumption of regularity. It must be presumed that Judge Blackwell in the civil action had taken into consideration and satisfied himself of the statutory requirement, namely that the respondent asked for possession for his own occupation. He cited General Accident Fire & Life Assurance Corporation, Limited v. Inland Revenue Commissioners⁽¹⁾ in support of his contention that a consent order which was silent in certain aspect must be construed in the light of and together with the evidence and the particulars of claim. Judge Blackwell, he contends, could only make an order for possession on the ground as claimed in the statement of claim - possession for own occupation. Once it was accepted that the order was made in the light of the pleadings, the order was valid and was made pursuant to section 53(2)(b). In addition, he draws our attention to the case of Thorne v. Smith⁽²⁾ .

10. Mr. Chan for the respondent, on the other hand, is content to rest his argument on the fact that the order made by Judge Blackwell was silent as to the basis on which it was made. He concedes that Judge Black -well's order was not a Tomlin order, the breach of which would not have attracted any criminal liability under section 53(7B) (and this is accepted by Crown Counsel). He contends that the order made by Judge Blackwell in the civil action equally could not attract criminal liability because it was apparent that it was not made pursuant to section 53(2)(b). He further contends that when the writ was amended on the 2nd of April, 1980 all the respondent had to prove was that he required a possession of the said premises for his own occupation.

11. An amendment to section 53(2) was made and, took effect on the 15th of February, 1980. The statutory requirement was changed in that he had to prove that he reasonably required the said premises for his own occupation. Hence the amended writ on the 2nd of April, 1980. The respondent obtained possession on the 1st of September, 1980. That vas before a further amendment to the said ordinance in December 1981. Prior to the 19th December, 1981 any landlord who committed a breach of the court order made pursuant to section 53(2) was merely liable to pay compensation. After the 18th of December, 1981 a landlord committing a similar breach became liable to other penalties as provided for in section 53(7B).

12. Frankly speaking, we do not appreciate Mr. Chan's second limb of his argument. Either the order in the civil action was obtained for the respondent's own occupation or not. If it was, the respondent had committed a breach of that order by selling the suit premises whether or not the reason he gave was required for his own occupation or reasonably required for his own occupation. The respondent committed the breach on the 16th of January 1982, well after the new amendment came into effect and the existence of section 53(7B) on the 18th of December, 1981.

13. In the case of CHU Kin-ying v. The Queen⁽³⁾, Sir Alan Huggins, V.-P. said.-

"Unfortunately, although clearly various documents relating to the action were put in evidence before the court below, those documents were never marked as exhibits and they formed no part of the record. Most essential, of course, was the order which was made in the civil action because only if the order vas one which was contemplated by s.53(7B) could the offence be committed. The order has been put before us and we assume that this was the order which was put before the judge, and it is in the form of what is commonly called a Tomlin Order.

Later, he said:

"It is common ground before us that no judgment for possession was in fact entered; the only 'judgment' was that dated 5th June 1980, which is the Tomlin Order.”

In the present case, the order in the civil action made by Judge Blackwell was put before the trial judge in the court below. All that was argued was that apart from saying that it was by consent of the parties, the order was not expressed as having been made pursuant to any reason or to section 53(2)(b).

14. In the case of FUND Wing-kwong v. The Queen⁽⁴⁾ , heard before another division of this Court, a situation similar to those in the present case obtained and a similar order in the civil action was made. Although the defence to the prosecution centered on the question of mens rea I said in that case:

"It is true that had he obtained possession by a compromise which was not confirmed by a court order, he could have resold or re-let his premises with impunity. However, he obtained possession by virtue of that court order."

In that case, the appeal against conviction was dismissed.

15. It is appreciated that in the FUNG Wing-kwong Case ⁽⁴⁾ the point whether the order for possession was made pursuant to section 53(2)(b) was not seriously contested. In the case of Thorne v. Smith⁽²⁾ , a consent order was obtained without further trial or investigation. The landlord after regaining possession, put his house for sale with vacant possession. It was held by the Court of Appeal that possession was obtained in that case by misrepresentation within the meaning of the Rent Restriction Acts. Bucknill L.J. said at page 314 as follows:

But in the present case it is, I think, reasonably clear that the tenant in effect agreed to the order because at the time when the landlord asked the court to make the order the landlord by his own statements had satisfied the tenant that he intended to occupy the house himself and he, the tenant, could not hope successfully to resist the claim. If the tenant had stated this expressly in court the judge would surely have had jurisdiction to make the order on that ground. I think in the events which happened here, the defendant being legally represented, the judge was entitled to make the order on the assumption that this was the true position.

Before making an order for possession the judge is under a duty to satisfy himself as to the truth if there be a dispute between landlord and tenant, but if the tenant in effect agrees that the landlord has a good claim to an order under the Acts, I think the judge has jurisdiction to make the order for possession under the Act without further inquiry."

Somervell L.J. said at page 315 as follows:

"The other point arises from the use of the word 'consent' as applied to the order made herein. The expression 'a consent order' may suggest some compromise or arrangement which might be inconsistent with the provisions of the Acts. When the defendant is agreeing to submit to judgment because he is satisfied that the plaintiff car establish his right to an order under the Acts, it might be advisable to avoid the use of the word 'consent', which may have a wider meaning and cover cases where the 'consent' was the result of an arrange-ment which could not properly be made the basis of an order."

In that case the appeal was allowed and the tenant was held to be entitled to compensation on the ground that the landlord who obtained the possession by representing that he wanted the house for his own occupation had committed a misrepresentation.

16. In the circumstances, we are of the opinion that by the same token, the consent-order made by Judge Blackwell could only be made after he was satisfied that the respondent, as plaintiff in the civil action, required possession of the suit premises for his own occupation (be it a requirement or a reasonable requirement). The landlord's ground for seeking possession was contested by the tenant before the settlement was reached. The tenant later conceded that point without trial solely and simply because that was the ground advanced by the respondent when asking for possession.

17. Whether that order for possession was mace as a result of the concession made by PW1 is a matter to be decided by Looking at all the circumstances and is a question that must, if necessary, be decided by the judge in the court below. To that extent, the case of The Queen v. LEUNG LEE Fung-ming⁽⁵⁾ was wrongly decided on that point.

18. In the present case, the evidence of PW1 taken as a whole strongly indicated that he did in fact conceded that the landlord reasonably required the premises for his own occupation. Mr. Chan's argument upon the introduction of the element of reasonableness by the then recent amendments to the Legislation is too fine and technical to affect the realities of the situation. Judge Blackwell would not have made the consent order without some indication from the tenant or his counsel that the tenant did so concede. Although we do not accept Mr. Barlow's contention that the fact of consent after the initial denial of the landlord's claim is itself such an indication, yet in the Light of the reasons set out afore-mentioned and in the absence of evidence to the contrary (and we do not accept that the absence of a note on the Judge Blackwell's formal record is such evidence), it would be reasonable to infer that some indication of the concession was in fact given to him. The trial judge in the criminal proceedings was, therefore, wrong to stop the case at that stage.

19. In the court below PW1 gave evidence as to how the civil proceedings before Judge Blackwell was started by the respondent and the reason the respondent gave for claiming possession of the suit premises (i.e. self occupation). He thought he merely had a 50:50 chance if he resisted the respondent's claim. But there was the inducement of ex-gratia payment.

20. What was the actual motivating factor for PW1's concession to the respondent's claim in the civil action can only be a matter of speculation. Two things are clear. If the respondent did not use the misrepresentation (as was done in Thorne's Case⁽²⁾ )of self-occupation by issuing a writ founded on that reason, the respondent would have to pay much more to PWL (the sitting tenant). This was so because the respondent would never obtain possession in the form of a consent order. PWL would be in a better position to resist his claim. The landlord would have to pay more for it.

21. Secondly, without pill's concession and without the respondent's reason for requiring the suit premises for self occupation as stated in his statement of claim, the judge could not have been satisfied of the statutory requirement, and so he would not have made the consent order in such form. It would have been sarong for him to do so.

22. For the aforesaid reasons, our answer to the first question of the case stated is in the affirmitive. Our answer to the second question is in the negative. Our answer to the last question is that the verdict should be set aside and the case remitted to the trial judge to resume the hearing on the basis that there is a case to answer.

(1)    (1963) 1 All E.R. 618

(2)    (1947) 1 K.B. 307

(3)    Criminal Appeal 232 of 1981

(4)    Criminal Appeal 1091 of 1981

(5)    Case No. 9 of 1981

Representation:

Mr. Barlow & Miss Plumptre, C.C., for appellant

Mr. E. Chan (Woo, Kwan, Lee & Lo) for respondent