He Ken and Others v. The Personal Representative of the Estate of Tang Wah also known as Tang Wah Kee, Deceased

HCA66/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 66 OF 2000

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BETWEEN

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Before : Deputy High Court Judge Seagroatt in Chambers (Open to Public)

Date of Hearing : 19 July 2011

Date of Judgment : 19 July 2011

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J U D G M E N T

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1.The plaintiffs commenced this action by Writ endorsed with a Statement of Claim on 4 January 2000. The Statement of Claim was amended on 25 November 2002.

2.The plaintiffs own a parcel of land in the North as tenants in common in equal shares, as successors in title to the original owners.  The defendants are the personal representatives of Tang Wah Kee, deceased, who was the tenant under an oral agreement made in or about 1950. The tenancy is alleged to be an agricultural tenancy.

3.It is alleged that in about 1987, in breach of the tenancy agreement the deceased changed the user of the land from agriculture to commercial shop premises and created illegal structures in the form of stalls on the land.  I say the deceased, but it may well be the deceased’s successors in title but it matters not as far as the allegation is concerned.  The plaintiffs’ predecessors in title gave notice of objection to the activities but the deceased and/or his personal representatives have failed and and/or refused to revert the user of the land to agricultural purposes.  Further structures were erected in 1992.

4.Furthermore the deceased and/or the defendants have failed to pay rent for the said land since January 1992.  The defendants contend that the agents of the plaintiffs’ predecessors failed or refused to collect rent since the early 1990’s.  However their position has shifted somewhat in that they now contend that in 1993 they paid rent for 15 years in advance i.e. up to 2007, and that they have a receipt to this effect. The genuineness of the receipt is disputed.

5.The Amended Defence of 11 February 2002 contends that the land was let for residential occupation and that it was agreed that the deceased could use the land to operate his business.  Alternatively the Defence pleads waiver or acquiescence in respect of any change of user. The works in or about 1992 were not, it avers, new structures but remedial works to the original structures, which the plaintiffs, or their predecessors accepted.

6.The action has had a rather long drawn-out history.  I need only pick out the principal events.

7.In May 2002 the defendants took out a summons to strike out the action for want of prosecution.  This was dismissed on 27 November 2002 when a number of other orders was made by Master Mary Yuen. The plaintiffs duly served a Notice of Intention to proceed on 2 October 2002.

8.Not much happened in 2003 save that on 26 February Master Lung gave leave for the action to be set down for the trial within 42 days.  Then it seemed to go to sleep for a while.

9.Aerial photographs were obtained in 2004 and regrettably the plaintiffs’ solicitor, who had been ill for some time and therefore unable to progress the action, died in 2005.  There was a change of firm of solicitors for the plaintiffs in February 2005 and a handwriting expert was instructed.

10.Further Notices of Intention to proceed were given in January and June 2006, and again in October 2008 followed swiftly by a summons for judgment under Order 14, in December 2008.  On the hearing of this in January 2009 Master Levy adjourned it until the following month for a call over hearing to deal with setting down the action for trial.  On 9 April 2010 came another Notice of Intention to proceed.  Then in June of the same year the plaintiffs changed solicitors again.

11.The year 2010 saw, in relative terms, a flurry of activity with the plaintiffs’ solicitors writing in October to the defendant’s solicitors seeking to withdraw their Order 14 summons (taken out in December 2008) and take out a case management summons.  This precipitated a summons to dismiss for want of prosecution taken out by the defendant’s solicitors on 8 November 2010.  This came before Master Levy on 25 March 2011 and it is her dismissal of this which occasions this appeal before me.

12.Although this is a rehearing I have had the advantage of reading the transcript of the judgment of the learned master.  The matters ventilated and argued before me were those with which she was faced.

13.In an extremely careful and comprehensive judgment she reviewed, as I have done, but in more detail the history of the action.  She then set out the applicable principles in accordance with the periods of delay identified, and how they should be approached since they fell either side of the coming into force of the Civil Procedure Rules.  I agree entirely with her approach and her application of the case law.  The detailed consideration of NeubergerJ (as he then was) in Annodeus Entertainment Ltd and another-v-Gibson and another—unreported—Chancery Division, 2 February 2000, is particularly apposite.  He identified nine factors.  I shall identify the last three as having particular relevance to this situation:

“Seventhly, the CPR enable the court to adopt a more flexible approach … The court has other sanctions at its disposal which it can and, in appropriate cases, should impose, rather than adopting one of the two extreme positions. Those weapons, those sanctions, are discussed in the judgment of Lord Woolf, MR in Biguzzi v Rank Leisure Plc [1999] 4 All E.R. 934, [1999] 1 WLR 1926 … They include payments into court, providing for no interest in favour of a claimant … and for appropriate directions and supervision for the future conduct of the trial.”

“Eighthly, in light of general principle and the overriding objective … the sanction, if any, to be invoked by the court to deal with a particular case of delay should be proportionate. To dismiss a claim where the claimant appears to stand a reasonable chance of success and of recovering substantial damages is a strong thing to do.”

“Ninthly, it appears to me that it is normally relevant to consider the following factors. First, the length of the delay; secondly, any excuses put forward for the delay; thirdly, the degree to which the claimant has failed to observe the rules of court or any court order; fourthly, the prejudice caused to the defendant by the delay; fifthly, the effect of the delay upon trial; … seventhly, the extent if any to which the defendant can be said to have contributed to the delay; eighthly, the conduct of the claimant and the defendant in relation to the action; ninthly, other special factors of relevance in the particular case.”

14.It is clear to me that the learned Master took all these features into account.  I would add only that the cause of action is a continuing cause and even if the plaintiffs’ proceedings were to be brought to a halt now, it would be open to them to start afresh.  This remains a factor to be considered.

15.It is important to bear in mind the nature of this action.  It relates to land and an oral tenancy granted in or about 1950. At issue is a significant amount of value both for the plaintiffs on the one hand and for the defendant on the other.  It is not surprising that only one party to the agreement is still living and she is aged and abroad.  A resolution of the dispute is essential for the clarification of rights. Although there is some prejudice to the defendants, as there will be to most defendants as a consequence of delayed progress in proceedings, I am not convinced that there is anything like substantial prejudice. 

16.Although one must sympathise with the defendant over the loss of family members and his own ill-health in the intervening years, on the crucial issues I do not consider that whether this action was tried in 2002 or 2012 such events would make any difference.  Over the intervening years the defendants have had the profitable uninterrupted user of land which they may not have been entitled to.  A number of features of the available evidence is curious, in particular the purported receipt of rent covering the period 1993 to 2007 and dated January 1993, covering in fact 15 years.  The structures are on the face of it illegal in that there is no evidence supporting their approval or consent.  But it is not for me to try any issues.

17.To put an end to these proceedings would be to occasion enormous prejudice to the plaintiffs and potentially give the defendants an undeserved benefit of significant proportions, and as a consequence prevent the examination of alleged fraudulent activity.  It would leave an unhealthy vacuum.

18.A consideration of the authorities helpful and essential as it is—and I am indebted to Mr Rimsky Yuen, SC for the defendant and Mr Kevin Chong for the plaintiffs  for their cogent, direct and succinct arguments—serves to illustrate how carefully one must bear in mind the intrinsic nature of the particular cause of action or litigation, being reviewed.  This is where Neuberger J’s approach is so informative and constructive.  The application of rigid principle is in my judgment inappropriate.

19.I am satisfied that there has not been any intentional or contumelious delay, but there has been serious delay, some of it inexcusable.  However it does not in my judgment prevent there being a fair trial.

20.Master Levy’s appraisal, conclusions and rationale cannot be faulted and I adopt them in their entirety.  She has also followed Neuberger J’s seventh factor in providing appropriate directions and supervision for the future conduct of the trial.  It would be a pointless exercise therefore for me to repeat them “in extenso” without attribution thereby plagiarising her judgment.  It would be somewhat artificial and certainly unnecessary to reprint pages of her judgment in quotation marks.

21.The appeal is therefore dismissed with costs. It has occurred to me that where solicitors who have acted for the plaintiffs in the past, i.e. the predecessors of the plaintiffs’ current solicitors, have been responsible for delay and inactivity, their failings should be reflected in a severe taxation of any costs they seek to recover either against the defendants or against their own clients.  I leave the parties to direct this part of my judgment to the attention of any Taxing Master involved in later stages of this action.

Mr K.M. Chong and Mr Johnny Fok, instructed by Messrs Y.T. Szeto & Co., for the Plaintiffs

Mr Rimsky Yuen, SC and Mr Simon Lam, instructed by Messrs Andrew Chan & Co., for the Defendant