Jim Mai-gi v. Choy Kwun-ping

CACV000104/1981

Headnote

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Coram: Hon. Leonard, V.P., Cons & Zimmern, JJ.A.

Date of Judgment: 20th November, 1981.

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JUDGMENT

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Cons, J.A. :

1. On the 17th January last year the landlord of the premises we are concerned with was served with a notice by the police that the premises had been used for the purpose of gambling. Three persons had been arrested therein and subsequently convicted in South Kowloon Magistracy of an offence against Section 6 of the Gambling Ordinance Chapter 148.

2. The premises were held by the tenant on a two year lease which contained inter alia two convenants, one "to use the said premises for domestic purpose only" and the other "not to use the said premises or allow the same to be used for illegal or immoral purposes".

3. Consequently the landlord's solicitors wrote to the tenant alleging breaches of covenant and requesting the tenant to deliver up vacant possession on the 4th February. We do not know why that particular date was chosen. The tenant did not surrender possession and eventually the landlord issued his writ in the Kowloon District Court.

4. The premises fall within Part 2 of the Landlord and Tenant Ordinance, Cap. 7. Curiously however the Particulars of Claim were to some extent drafted as though the landlord had already forfeited the lease by the letter from his solicitors, and in particular claimed mesne profits as from 1st February. Even more curiously the solicitors were able to obtain an interim order for such profits from that date until trial.

5. The original Defence drafted by the tenant, who at that time was acting in person, was a simple denial of breach on the ground that she had had no knowledge of the gambling or reason to suspect that it would take place. Both the Particulars of Claim and the Defence were subsequently amended, the tenant by then being represented, but the amendments had little, if any, substantive affect.

6. Then on the 12th June this year the tenant reamended her Defence. This did have substantive effect, very much so. The object was to include in the Defence a request for relief from forfeiture if, in the end, the Court should find that there had been a breach. To this end there was pleaded a subletting, but that the tenant had no prior knowledge of the gambling, had given no consent to the gambling, was not present at the time of the gambling and had evicted the subtenant for his behaviour within 3 days of his arrest. The subtenancy had in all lasted only 7 days.

7. Now the lease contained another covenant, that the tenant should not without the prior written consent of the landlord assign, transfer, sublet or part with possession of the said premises or any part thereof to any person or persons or firm or body corporate. There is also Section 53(2)(e) of the Ordinance.

8. The landlord reacted swiftly. On the 15th June Reamended Particulars of Claim were filed, alleging further and in the alternative a breach of the covenant against subletting and of the statute. Service was effected on the tenant on the 18th.

9. The action came on for trial before His Honour Judge Wong on the 3rd July, i.e. 15 days later. Nothing whatever had been done in the mean time. The solicitor for the landlord immediately asked for judgment on admissions. Counsel for tenant countered with a request for leave further to amend the Reamended Defence. She handed to the Judge a rough draft of what was intended. This admitted the covenant against subletting but denied any breach, save as to the fact of subletting. It further alleged an estoppel based on prior oral permission to sublet. The Judge refused the application and made a summary order of possession in favour of the landlord.

10. The tenant brings her appeal on two grounds. Firstly that the Judge was wrong to refuse her application, secondly that such admissions as had been made were not sufficient to found summary judgment, in that she had not admitted lack of written consent.

11. The grant or refusal of a late application to amend is of course a matter of discretion for the trial Judge and this Court is slow to interfere unless, for example, the Judge has acted under a misapprehension as to the facts or a mistake law or has taken into consideration matters which he ought not.

12. Counsel for the tenant points out that the Judge appears to have thought that the Re-amended Defence was filed in the February rather than in the June. That would be an easy mistake to make if he did, for the interlocutory record is confused by an incorrectly worded summons.

13. More importantly the Judge seems to have taken the view that the suggested defence was not tenable in law, which would be contrary to the decision of this Court in CHUK Yau-cheong v. LEE Miu-ying⁽¹⁾ and he has made several comments which, taken together, tend to give the impression that he had already made up his mind that it was untrue. In the circumstances I feel interference is justified if this Court should come to the conclusion that all in all the tenant's application ought to have been allowed.

14. I understand that for reasons which he is about to give my Lord The Vice-President has come to the conclusion that the amendment ought not to have been allowed and that Zimmern, J.A. is of the same opinion. I have the greatest respect for their views and am also conscious of the need to ensure that the process of the Court is not abused. Nevertheless I would for my part have preferred the case to have been dealt with on its merits. At most the landlord would have needed five or ten minutes to consult with his solicitor, perhaps not even that if the Judge had called upon the tenant to open the proceedings. The question of written consent could not possibly have extended those proceedings beyond one day. Even if it could, the landlord cannot have been in urgent need of possession. After the original defence had been filed he waited for over seven months before doing anything else in the action. The explanation put forward for that delay is not convincing.

15. I turn then to the second ground of appeal. Counsel for the tenant submits, and I think correctly, that to warrant a summary order for possession the landlord must show a clear admission of both the fact of subletting and of the lack of written consent. He argues that only the first was before the Judge below.

16. Counsel for the landlord seeks to show the second essential in two ways. First he says that it is to be found in the rough draft handed to the Judge. That needs to be set out in full :

Particulars

On two occasions in about August and November 1979, the Plaintiff orally agreed to allow the Defendant to sublet the said premises."

17. Paragraph 11 of the reamended Particulars of Claim pleads the covenant against subletting. Paragraph 12 pleads that the subletting was in breach of the covenant and Section 53(2)(e) of the Ordinance.

18. Counsel submits that one inference of fact to be drawn from the proposed paragraphs 6 & 7, although perhaps not necessarily the only inference, is that no written consent had been given; that a Judge is entitled to draw such inferences of fact as he thinks fit; that the Judge here did draw the inference suggested and that this Court ought not to interfere with a finding of fact.

19. As I read the Judge's decision it is doubtful that he did draw such an inference. However if he did, I do not think it was justified. Rankine v. Garton Sons & Co. Ltd.⁽²⁾, on which Counsel for the tenant heavily relies, shows how careful we must be, in a matter of this kind, to look only at the actual words used and not to read into them anything that is not strictly there. Looking at the words used in the present instance I am unable to find an admission that no written consent had been given. Therefore this argument for the landlord fails.

20. The second argument is interesting. It turns upon Order 18 rule 13(1) & (3) which provide as follows :-

Paragraph (4) has no application here.

21. Since no pleading was filed in answer to the reamended Particulars of Claim the only denial of paragraphs 11 & 12 is in the general traverse of the Reamended Defence :

22. The effect of a general traverse was considered in Warner v. Sampson⁽³⁾, where incidentally the Court was looking at it not so much as a denial but as a possible positive affirmation. Lord Denning spoke of it thus :

"Since so much effect has been given to this general denial, I would say a word about it. It is used in nearly every defence which goes out from the Temple. It comes at the end. The pleader has earlier gone through many of the allegations in the statement of claim and dealt with them. Some he has admitted. Other he has denied. Whenever he knows there is a serious contest he takes the allegation separately and denies it specifically. But when he has no instructions on a particular allegation, he covers it by a general denial of this kind, so that he can, if need be, put the plaintiff to proof of it at the trial."

With the greatest respect I venture to think that these words are not meant to grant blanket permission to Counsel, or solicitor, to ignore the substantial allegations made against his client and to rely on his being saved by a general traverse. That would be a serious detraction from the intention of Order 18 rule 13. I find implicit the suggestion that Counsel must meet and deal with those allegations, for the contest about them, if there is to be one, will be serious. Only the inconsequential matters may be safely left to the general traverse.

23. This would seem to accord with the views of the learned editors of the Supreme Court Practice:

"In dealing with a long and complicated statement of claim or counterclaim, and especially with allegations which are more or less immaterial, this practice is often convenient. It should not, however, generally be adopted in dealing with essential allegations."(4)

24. Counsel for the tenant referred to it as a "sweeping up" paragraph. In a way I think he is right. It is like a broom to sweep up the dust and debris. But a broom is not apt to deal with large obstacles. They have to be picked up and disposed of individually.

25. In a case like the present the allegation that the landlord gave no written consent, which is implicit in the words "in breach of the said covenant the Defendant .......... has .......... sublet" is an essential element. The Defendant ought to have dealt with it specifically. By his not doing so it is deemed to be admitted. The learned Judge was right to order possession when he did.

26. For these reasons I would dismiss the appeal.

Leonard, V.P. :

27. I am quite satisfied that the trial Judge was right to refuse to allow the further amendment sought by Miss Mok. It was sought not at the eleventh hour but after the clock had struck mid-night. The dates are of some importance.

28. On 5th December 1979 three persons were convicted of gambling in the premises. On 24th January 1980 Notice to deliver up premises on 4th February 1980 was served.

29. The writ was dated 22nd March 1980 but it could not be served although the tenancy in question was a domestic one. Substituted service was ordered on 9th May 1980. We do not know the date on which substituted service was finally effected but it was not until 11th June 1980 that the defence was filed. The defence admitted that three persons were convicted of gambling on the 4th December 1979 and baldly denied using or permitting the premises to be used for gambling and knowledge of such use. The defence was filed by the defendant in person but it has all the hallmarks of having been prepared with professional assistance. Paragraphs 2, 3 and 5 read as follows:

30. If the defendant was sincere in her approach to the Court one would have expected her as early as 11th June 1980 to have alleged the existence of the subtenancy and of the plaintiff's consent to it in explanation of her lack of knowledge.

31. Even on the 4th February 1981 when she was legally represented she failed to do so. When she re-amended the defence on 12th June 1981, almost a year and a half after the notice to deliver up the premises, she failed to allege that the subletting was with consent. Anyone who seeks relief against forfeiture should disclose to the Court all the relevant facts. To my mind the fact that the lease contained the other covenant not to sublet without prior written consent (and I emphasize the word "written") should have been present to the mind of the defendant's legal advisers from the very beginning. If it was not they were guilty of negligence. It was a highly relevant fact particularly when relief against forfeiture was claimed and its existence should have been acknowledged and the absence of written consent should have been explained - if it was capable of explanation. The re-amended particulars of claim was filed on the 15th June 1981 and yet it was not until the date of the hearing, 17 days later, that the appellant without having given any prior notice to the respondent, sought leave to amend the defence for the third time. The proposed amendment seeks to deny having acted in breach both of the covenant and of Section 53(2)(e) (which also calls for written consent). It does not allege written consent. It alleges consent and an estoppel. The only facts sought to be pleaded from which an estoppel could possibly arise are "On two occasions in about August and November 1979 the plaintiff orally agreed to allow the defendant to sublet the said premises". This was not an adequate pleading for it does not mention the absence of writing nor seek to explain it. I cannot fault the Judge for having refused to permit this amendment in the circumstances. It came far too late.

32. I have been in some difficulty as to whether the proposed amendment amounted to an admission that there had been no written consent. In common sense it clearly implied such an admission, as counsel for the appellant clearly thought at the time, for the particulars allege an oral consent. On balance in view of the denial of breach, I have come to the conclusion that common sense must once more be sacrificed at the altar of legalism that the admission cannot be implied from the proposed amendment itself and that Rankine v. Garton Sons & Co. Ltd. ⁽²⁾ applies to it. I am however in entire agreement with what has been said by Cons, J.A. on the subject of the general traverse and as to the duty of the defendant specifically to deny the material averment, that the defendant sublet without written consent and I too would dismiss this appeal.

Zimmern, J.A. :

33. On 22.3.80 the plaintiff respondent herein qua landlord commenced proceedings in the District Court against the defendant appellant for possession of certain premises alleging that the appellant had under their tenancy agreement allowed the premises to be used for an illegal purpose namely gambling in breach of covenant and for mesne profits.

34. On 11.6.80 the appellant in person filed a defence claiming that she never knew or suspected that the premises had been thus used.

35. In January 1981 the respondent with leave amended her Particulars of Claim to include the allegation that the appellant by the use of the premises for an illegal purpose had also contravened Section 53(2)(e) of the Landlord & Tenant Ordinance.

36. On 4.2.81 the appellant now represented by solicitors with leave amended her Defence without actually any change in substance by adding a new paragraph 5 containing the familiar sentence :

"Save as hereinbefore expressly admitted, each and every allegation in the Amended Particulars of Claim are denied as if the same were herein set out and traversed seriatim."

37. On 20.2.81 the appellant applied and obtained leave to re-amend her Defence. The intended amendments contained a new allegation in that the appellant in the alternative prayed for relief against forfeiture on the grounds so far as is relevant to the appeal :

38. Unhappily those acting for the appellant failed to file the Re-Amended Defence within the time allowed under the rules of Court. They did not wake up to this till 26.5.1981 when a further application was made and the Order for leave was granted on 10.6.81 and the Re-Amended Defence filed on 12.6.81.

39. The plaintiff having been given leave on the defendant's application filed on 15.6.81 and served on 18.6.81 a Re-Amended Points of Claim. The amendments were substantial and forseeable. They read:

40. It would appear that for quite some time then the parties knew that hearing of the matter had been fixed for 3.7.81.

41. At the hearing Counsel for the defendant at the outset applied for leave to further re-amend the Defence and handed to the Court the formulated proposed amendments signed by Counsel. It reads :

Particulars

On two occasions in about August and November 1979, the Plaintiff orally agreed to allow the Defendant to sublet the said premises."

42. The application was resisted and it would appear that those acting for the defendant had not intimated to those acting for the plaintiff by notice or otherwise of the intended application. The learned Judge refused the application whereupon the solicitor appearing for the plaintiff applied to the Court for judgment on admission as stated in the Re-Amended Defence. According to the notes of the proceedings this application was not resisted and the Judge entered judgment for the respondent for possession and mesne profits.

43. The appellant now with leave of the District Court before us appeals against both the refusal of the defendant's application for leave to further re-amend and entry of judgment on the ground of admission of fact of sub-letting by the appellant in her Re-Amended Defence when at the stage the question of sub-letting was not at issue. The learned judge was alleged to have been wrong in law on both issues.

44. As regards the judgment on admission Counsel for the appellant submitted that the burden was on the plaintiff to prove 2 elements: first the fact of subletting and second that it was done without the prior written consent of respondent. For this he relies on Rankine v. Garton Sons & Co. Ltd. ⁽²⁾ There can be no argument on the correctness of this submission. He submits that in respect of paragraphs 11 and 12 of the Re-Amended Particulars of Claim which I have set out above, first they are sufficiently covered by the general denial of each and every allegation, contained in paragraph 5 of the Re-Amended Defence. The fact that this general denial predates the allegations contained in the above mentioned paragraphs 11 and 12 is immaterial. Therefore he said the Judge could not have given a judgment on admission under this head. Second if the Court had taken into consideration the rejected proposed amendments to the Defence then paragraph 6 merely admits the sub-letting but denies that it was done without the written consent of the plaintiff. Therefore only one of the two elements had been admitted and again the Judge could not have entered a judgment on admission. Third though the rejected proposed amendments contain an admission of sub-letting it was clearly alleged to have been pursuant to an oral agreement which was sufficient to satisfy the Ordinance and no proper inference can be drawn that it was done without any written consent in breach of the tenancy agreement. Fourth the admission of sub-letting contained in the Re-Amended Defence was as to sub-letting only. There was no admission of the second element required to constitute the breach therefore the judgment again could not have entered on admission under this head.

45. An amendment of a writ or pleadings duly made, with or without leave, takes effect not from the date when amendment is made but from the date of the original document which it amended. Thus an amendment made to the writ dates back to the date of its original issue and the action continues as though the amendment had been inserted from the beginning (Saeade v. Wotherton Barytes & Lead Mining Co. Ltd.⁽⁵⁾)

46. The effect of this principle is that at the date of hearing, the pleadings having closed, the defendant's Re-Amended Defence stood in answer to the plaintiff's Re-Amended Particulars of Claim. They contained the issues to be tried. There was no specific denial to the plaintiff's allegation of breach by sub-letting without prior notice in writing under paragraphs 11 and 12. In fact the Defence expressly admitted the sub-letting.

47. Order 18 r.13 provides :

48. The appellant relies on the general denial under paragraph 5. This general denial came up for review in the Court of Appeal in England in Warner v. Sampson⁽³⁾. The plaintiff qua landlord sued the tenants and claimed possession of premises for non-payment of rent; the tenant's Defence ended with the general denial whereupon the plaintiff claimed forfeiture of the lease by reason of the denial and repudiation of the landlord's title and succeeded at first instance. On appeal their lordships allowed the appeal on the ground inter alia that the effect of a general denial was not a denial of the landlord's title and was no more than something putting the plaintiff to proof.

49. Lord Denning at pages 310 and 311 :

"Since so much effect has been given to this general denial, I would say a word about it. It is used in nearly every defence which goes out from the Temple. It comes at the end. The pleader has earlier gone through many of the allegations in the statement of claim and dealt with them. Some he had admitted. Others he has denied. Whenever he knows there is a serious contest he takes the allegation separately and denies it specifically. But when he has no instructions on a particular allegation, he covers it by a general denial of this kind, so that he can, if need be, put the plaintiff to proof of it at the trial. At one time the use of this general denial was said to be embarrassing: see British and Colonial Land Association Ltd. v. Foster and Robins(6), but since 1893 it has been recognized as convenient and permissible : see Adkins v. North Metropolitan Tramway Co.(7) Sometimes the pleader "denies", sometimes he "does not 'admit' each and every allegation; but whatever phrase is used it all comes back to the same thing. The allegation is to be regarded "as if it were specifically set out and traversed 'seriatim'. In short, it is a traverse, no more and no less."+

If the general denial is no more than putting to proof of the plaintiff's claim then it cannot relieve the defendant from compliance with O.18 r.13 on such important allegations of fact contained in paragraphs 11 and 12. Furthermore the Defence contains an express admission of sub-letting without pleading to the 2nd element contained in the claim which he must do if he wants successfully to confess and avoid.

50. No general denial can overcome that for Order 18 r.8(1)(a) and (2) which reads as follows applies :

51. In short, when a party relies on confession and avoidance he cannot just confess without specifically pleading the matters relied on for the avoidance.

52. Accordingly I find and hold that the judge was right in entering judgment for the plaintiff.

53. Turning to the Judge's refusal to grant leave to further re-amend the Defence at the hearing of the action.

54. The principle that a party should be given leave to amend however late the proposed amendment if there is no injustice to the other party and that other party can be compensated by costs is too trite to require an authority. On the other hand if the application be made mala fide or if the proposed amendment will cause undue delay leave to amend will be refused. Here in this case the original claim was for possession of premises for using the premises for an illegal purpose in breach of covenant. To avoid this net the defendant claimed ignorance by reason of sub-letting When caught in a further net of sub-letting without the prior consent of the landlord in writing the defendant did nothing about this till the very day of the hearing when without prior notice to the plaintiff the defendant springs a proposed amendment formulated as nebulously as could be devised based on the now fashionable oral agreement, waiver and estoppel in such matters. The learned Judge refused that and it is impossible to say that he exercised his discretion wrongly in any way. I would also dismiss the appeal.

Representation:

Mr. Ronny K.W. Tong (Michael Cheuk & Co.) for Appellant/Defendant

Mr. Anthony Neoh (Gallant Y.T. Ho & Co.) for Respondent/Plaintiff

(1) (1979) H.K.L.R. 575

(2) (1979) 2 All England 1185

(3) (1959) 1 Q.B. 297

(4) 1979 edition at 18/13/5

(5) (1904) 1 K.B. 295

(6) (1888) 4 T.L.R. 574

(7) (1893) 10 T.L.R. 173