Wai Wah Traders Ltd v. Wong Yim t/a Creative Advertising Design Co and Others

HCMP 965/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 965 OF 2000

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BETWEEN

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Coram : Deputy High Court Judge Mimmie Chan in Court

Dates of hearing : 3-4, 7-8, & 10-11 November 2011

Date of handing down Judgment : 8 December 2011

JUDGMENT

Background

1.This action relates to the parties’ competing claims to a plot of land in Yuen Long, known as Lot No. 1306 in Demarcation District No. 117, which has been referred to in the action as "the Land". From about 1950 until just before the early 1990s, the Land was part of a large and lush area of trees, most if not all of which were lychee trees. The area was marked as orchards in the topographic sheets of the district in 1963. There were also stretches of cultivated farmland on one side of the Land. As the aerial photographs produced in this action show, from about 1993, the area of the Land covered by trees began to shrink and to become steadily reduced in size, until about less than half of the trees remained, with the rest of the Land having been either dug up or eroded by use of motor vehicles or machinery. By 2008, more than half of the Land was bare and used only for storage of cargo containers, vehicles and other structures of similar aesthetic appeal. Sadly, this has now become the typical evolution of land use in the New Territories in Hong Kong.

2.The Plaintiff company and Mr. Yeung Shing Wan ("Mr. Yeung") became the registered owners of the Land in September 1973. In August 1981, Mr. Yeung's share in the Land was transferred to Mr. Ching Chi Wai ("Mr. Ching"), a director of the Plaintiff. Mr. Ching's interest was in turn assigned to the Plaintiff in March 1999, since which the Plaintiff became the sole registered owner of the Land.

3.As apparent from the aerial photographs and the topographic sheets of the region, the Land and its surrounding plots were densely covered by trees from at least 1954 to the early 1970s. By "surrounding plots", I refer to Lot 1185 and Lot 1186 to the north of the Land, Lot 1309RP and Lot 1309C to its south, and Lots 1300SA, 1309SB and 1309SA to its east. According to the land search records, Lots 1185, 1186, 1306 (the Land itself), and 1309SA, 1309SB, 1309SC and 1309RP were all registered in the name of the same owner, Leung Fo Wan, before 1958 or 1966.

4.The 12th Defendant in these proceedings is Mr. Leung San Fat ("San Fat"). He claims that his parents, he and his younger brother, Mr. Leung Fok Yuen ("Fok Yuen") have occupied the Land since the 1960s.  The other defendants named in the proceedings either used or occupied the Land under San Fat's licence, or have vacated the Land by the time of trial. The 13th Defendant ("Mr. Cheng") claims that he has been occupying a portion of the Land since 1992, under a tenancy agreement made with San Fat as landlord. San Fat claims that by virtue of his family's adverse possession of the Land for over 20 years, they have acquired possessory title to the Land. He claims, by way of Counterclaim filed in these proceedings, a Declaration that the Plaintiff's interest in and title to the Land was extinguished prior to the commencement of these proceedings in 2000.

Legal Principles

5.It is clear that a person claiming to be in adverse possession must be shown to have both possession and the requisite intention to possess (Wong Tak Yue v. Kung Kwok Wai & Another [1998] 1 HKLRD 241, applying the principles enunciated by Slade J in Powell v. McFarlane (1979) 38 P & CR 452 and confirmed in Buckinghamshire County Council v. Moran [1990] 1 Ch 623). In the absence of evidence to the contrary, the owner of the land with the paper title is deemed to be in possession of the land. The burden is on the squatter to prove that he has both factual possession of the land and the requisite intention to possess. As pointed out by Nourse LJ in Buckinghamshire County Council v. Moran [1990] 1 Ch 623, and as applied by Li CJ in Wong Tak Yue v. Kung Kwok Wai & Another [1998] 1 HKLRD 241, adverse possession can be described as "possession as of wrong" and it is the intention of the squatter that is essential.  The requisite intention to possess for adverse possession "involves the intention, in one's own name and on one's own behalf, to exclude the world at large, including the owner with the paper title if he be not himself the possessor, so far as is reasonably practicable and so far as the process of the law will allow" (Powell v. McFarlane (1979) 38 P & CR 452, at 471-472). 

6.On the question of factual possession, the following statement of the law set out in the judgment of Slade J in Powell v. McFarlane (1977) 38 C & PR 452 at p. 471-1 has been often cited:

"Factual possession signifies an appropriate degree of physical control. It must be a single and exclusive possession, though there can be a single possession exercised by or on behalf of several persons jointly. Thus an owner of land and a person intruding on the land without his consent cannot both be in possession of the land at the same time. The question what acts constitute a sufficient degree of exclusive physical control must depend on the circumstances, in particular the nature of the land and the manner in which land of that nature is commonly used or enjoyed. In the case of open land, absolute physical control is normally impracticable, if only because it is generally impossible to secure every part of a boundary so as to prevent intrusion. ‘ What is a sufficient degree of sole possession and user must be measured according to an objective standard, related no doubt to the nature and situation of the land involved but not subject to variation according to the resources or status of the claimants’: West Bank Estates Ltd. v. Arthur [1967] AC 678-9 per Lord Wilberforce. It is clearly settled that acts of possession done on parts of land to which a possessory title is sought must be evidence of possession of the whole. Whether or not acts of possession done on parts of an area establish title to the whole area must, however, be a matter of degree. It is impossible to generalize with any precision as to what acts will or will not suffice to evidence factual possession. … Everything must depend on the particular circumstances, but broadly, I think what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it and that no one else has done so."

7.On the question of the requisite intention to possess, the squatter's intention must be objectively manifested and made clear to the world. At page 472 of his judgment in Powell v. McFarlane, Slade J made this clear:

"An owner or other person with the right to possession of land will be readily assumed to have the requisite intention to possess, unless the contrary is clearly proved. This, in my judgment is why the slightest acts done by or on behalf of an owner in possession would be found to negative discontinuance of possession. The position, however, is quite different from a case where the question is whether a trespasser has acquired possession. In such a situation the courts will, in my judgment, require clear and affirmative evidence that the trespasser, claiming that he has acquired possession, not only had the requisite intention to possess, but made such intention clear to the world. If his acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi and consequently as not having dispossessed the owner."

8.The question of intention to possess is one of fact, and whether it can be established depends on an assessment of all the circumstances in a particular case (Wong Tak Yue v. Kung Kwok Wai, supra, at 250).  On the question of intention to possess, Li CJ observed at p.250 of his judgment in Wong Tak Yue, supra :

"Where the occupier has made self-serving statements as to what was his intention, whether during the period of occupation or when challenged in legal proceedings, the courts should approach them with some skepticism.  The courts would scrutinize the circumstances in which they were made and would give them such weight if any as they may deserve.  Conversely, where the occupier has made statements as to what was his intention and such statements are against his interest, the courts would usually accord to them considerable weight."

Issues

9.The issues for determination at trial are therefore:

(1)       Had San Fat and his family been in factual possession of the Land for more than 20 years next before the commencement of these proceedings in April 2000?

(2)       Did San Fat and his family have the requisite intention to possess the Land to the exclusion of the world at large, including the registered owner?

(3)       What are the damages payable by San Fat for his occupation of the Land, if adverse possession is not established?

The Plaintiff's acquisition of the Land

10.For the Plaintiff, Mr. Ching's case is simple. He had been in the trade of pig iron from the 1960s to the late 1970s. The pig iron was stored in a warehouse in Kwun Tong. In the late 1960s, Mr. Ching purchased a piece of vacant land in Yuen Long, and stored his pig iron there. In the early 1970s, Mr. Ching learnt that the vacant land would be resumed by Government within a few years, and he set about looking for suitable farmland for storage of the pig iron. His intention was to apply to the Government for change of user of the farmland, should the vacant land he had used for storage be resumed by Government.

11.Mr. Ching then learnt of an opportunity to buy a piece of land near the lychee garden in Tai Tong, in Yuen Long. He went to inspect the property which is in fact the Land, and found it to be entirely covered with 20 odd lychee trees. It was flat and Mr. Ching considered it to be suitable for storing pig iron, and for building a house for staff to live there. The Land was purchased in the name of the Plaintiff in September 1973, in joint ownership with Mr. Yeung. Mr. Yeung  transferred his interests in the Land to Mr. Ching in 1981, and Mr. Ching in turn transferred his interests in the Land to the Plaintiff in 1999.

12.Mr. Ching claims that when he and Mrs. Ching first visited the Land in 1973, there was dilapidated fencing around, which he instructed his staff to repair and replace after the purchase of the Land. He paid for such works as well as for covering uneven parts of the Land with gravel. He also paid for insecticide to be applied onto the lychee trees on the Land. According to Mr. Ching, on his first visit to the Land, he could see a low fence between the Land and the chicken farm which was on the adjacent Lot 1309. He could climb over the fence to enter the Land. On each of their subsequent visits to the Land, Mr. and Mrs. Ching visited the chicken farm and entered the Land in the vicinity of the chicken farm.

13.The Land was ultimately never used by Mr. Ching or the Plaintiff for storage of pig iron, as Mr. Ching turned to engaging in business in China. His family emigrated to Canada in 1985 and did not return to Hong Kong until 1990. According to Mr. and Mrs. Ching, their family visited the Land a few times a year between 1973 and 1985. The Land was still covered by lychee trees and they could gain access without difficulty. They did not find any inhabitants or occupiers on the Land until much later in 1995 or 1996.

Where the lychee trees grew

14.San Fat and the witnesses called on his behalf referred frequently in the evidence to the "lychee garden" and to lychee trees. As the issue is relevant to whether the Leung family can establish factual possession of the Land, as well as whether they had the requisite intention to possess the Land and to exclude others from the Land, I will set out what I regard to the important aspects of the evidence on where the lychee trees grew.

15.According to the evidence produced on behalf of San Fat, his parents had been farming on the farmland next to the Land. It can be seen from the aerial photographs and the topographic sheets from 1954 to even the 1990s that Lots 1178, 1173, 1307 and 1308 along the western border of the Land had been used for agriculture during those times. In marked contrast, the land to the right of these agricultural lands can be seen to be densely covered by the canopies of trees until the early part of 1990. Lots 1306, 1305 and 1309, in particular, can be seen from the aerial photographs as a continuous stretch of tree-covered land.

16.Significantly, Lots 1179 and 1180 stood between the agricultural land (including Lot 1178) to the west on the left of the Land, and the Land itself. Lots 1179 and 1180 appear from the aerial photographs of the period from 1954 to 1990 to be within the part of the land on which lychee trees grew. It can clearly be seen from the aerial photographs of 1973 and 1981 that the two Lots, 1179 and 1180, are part of the lychee garden, as opposed to their being part of the agricultural land. If the topographic sheet of 1963 is compared with the aerial photographs, it can also be seen that Lots 1179 and 1180 are within the area marked as orchards. Even in 1990, the aerial photograph shows these two lots to be land on which trees grew, as opposed to their being agricultural land to which the canopy of the lychee trees on the adjacent land extended, as Counsel for San Fat suggested.

17.The vast area on which lychee trees grew, the fact that the Land is only one part of the entire area where lychee trees grew, and the fact that the Land is largely surrounded by other plots on which lychee trees grew, have to be borne in mind when the witnesses claim that acts had taken place within the lychee garden, or in relation to the lychee trees. It is also important to bear in mind that in the 1950s, and up to at least 1965, the land on which the lychee trees grew in the area was all owned by the Leung family clan, of which San Fat and his family was one branch. Access across and through this stretch of land would be largely unrestricted to the family and the clan.

Had San Fat and his family been in factual possession of the Land for more than 20 years next before April 2000?

18.The onus is on San Fat to show that he and members of his family had the sufficient degree of exclusive physical control of the Land from at least 1980, and that such physical control had continued for 20 years until the commencement of these proceedings in 2000.

19.San Fat was born in 1954. His brother, Fok Yuen, was born in 1957. According to Fok Yuen, his grandfather had left Hong Kong to work in America, and had sent home to Hong Kong the money he made. The money was used for the benefit of the Leung clan. Fok Yuen claims that his mother had used the money she received to purchase farmland around Tai Tong Village in Yuen Long. He identified such land purchased by his mother as Lots 1178, 1182, 1259 SC, 1259 RP, 1300 RP, 1301 and 1303, and a plot known as "Small Hill Garden" (小山園) in Lots 1309 SC, 1309SD, 1309SE and 1309 RP. All these Lots purchased by the Mother are collectively referred to below as "Mother's Land", for convenience. The Small Hill Garden adjoins the southern border of the Land. Lots 1178 and 1182 are the farmland to the north-west of the Land, whereas Lots 1259SC, 1259 RP, 1300RP, 1301 and 1303 are to the north-east of the Land.

20.According to the documents filed at the Lands Registry, Leung Yiu Lam (or Leung Iu Lam), who is San Fat's and Fok Yuen's father ("Father"), was registered as a trustee in respect of Lots 1259 RP, 1300, 1301 and 1303 (all included in Mother's Land) in 1956.

21.It is not claimed that the Land itself ever formed part of Mother's Land.

22.According to Fok Yuen, his parents had farmed on Mother's Land, growing vegetables and lychees and rearing ducks there.

23.A further bit of history has emerged from the documents registered at the Land Office, which is relevant to the parties' claims to the Land. In May 1963, a mortgage was registered ("Mortgage") against 29 different lots of land, including Lot 1306 (i.e. the Land) and Lot 1305 which shares the north-eastern border of the Land. The mortgagor was named as Leung Yuk Kwai of Tai Tong, and the mortgagee Enrique Chan of Braga Circuit, Kowloon. On 31 March 1965, the mortgaged properties including the Land were all sold by the mortgagee to one Madam Mak Chui Yuen. Madam Mak became registered as the owner of the Land in 1965, prior to the ultimate sale of the Land to the Plaintiff in 1973.

24.Leung Yuk Kwai named in the Mortgage is the uncle of San Fat and Fok Yuen ("Uncle").  He appeared to be the head of the village or clan at the relevant time. According to Fok Yuen, the title deeds to Mother's Land were given to the Uncle for safe custody, together with the deeds of the land belonging to others in the Leung clan. Fok Yuen later learnt that Uncle, a gambler, had used the properties to which he held the title deeds as security for his gambling debts. When he was unable to repay his debts, the property which he had mortgaged were all sold by Uncle's creditor in the 1960s. On Fok Yuen's evidence, the Lots known as Small Hill Garden which had been purchased by the Mother and registered in the name of the Father as trustee were sold in this way, all without the Father's knowledge or consent until the new owner sought possession of the property sold.

25.According to the evidence of Fok Yuen, when he was over 10 years old, he heard his Father and Uncle quarreling, and the row had ended in a fight. The Father was complaining that the Uncle had caused the Small Hill Garden to be sold off, and demanded that he should have the "lychee garden" as compensation. According to Fok Yuen, the Uncle had left without expressing any agreement. Thereafter, on Fok Yuen's evidence, his family claimed the "lychee garden" as their own, and he and his siblings had helped to tend the "lychee garden" since then.

26.Both San Fat and Fok Yuen claim that their Father had told them that he, and (according to Fok Yuen) an uncle as well, had planted the trees in the "lychee garden", and that it should be preserved by the family. San Fat claims that from young, he had helped to tend the "lychee garden", by trimming and fertilizing the trees, removing the wild grass and picking the fruit of the trees. Fok Yuen claims that the "lychee garden" to which he and San Fat refer is the Land which is the subject of these proceedings.

27.San Fat and Fok Yuen claim that as children, they and other children had played on the Land, picked lychees from the trees on the Land, caught chickens and shot at birds on the Land. They claim that their Father had built a fence on the Land in 1972. In 1981, their Father had built a small hut or shed on the Land to keep his farming tools. In about 1982, San Fat and Fok Yuen established the Tai Tong Lychee Garden ("Tai Tong Garden") about a kilometer away from the Land. This was their own business. They grafted branches or shoots from the lychee trees on the Land and transplanted the grafts onto trees in the Tai Tong Garden. When the Father died in 1984, San Fat and his Mother continued to tend the Land. During the lychee seasons, the Mother would sleep in the small hut on the Land, to prevent unauthorized entry into the Land and unauthorized picking of lychees.

28.According to San Fat, he removed some dead lychee trees in 1988, erected a canopy over a part of the Land, and leased the area out. He also commenced operations of a workshop or garage in Lot 1259 nearby, and began to park trucks on the Land after "trimming" some lychee trees. Fok Yuen also arranged for the 13th Defendant ("Mr. Cheng") to lease an area of the Land from San Fat for operation of Mr. Cheng's welding business.

29.I will consider each of the acts relied upon by San Fat, to ascertain whether it can be established that by reason of such acts, San Fat and his family have acquired sufficient control and possession of the Land for over 20 years.

The fence

30.It is claimed that in 1972, Father and the new owner of the adjoining Lot 1309, Mr. Tse, erected a wire mesh fence between the Land and Lot 1309. San Fat claims that he had assisted his Father in this, and explained that the wire mesh was put up to prevent chicken venturing from Mr. Tse's chicken farm onto the Land.

31.What is pleaded in paragraph 6 of the Re-re-amended Defence and Counterclaim is that San Fat and his Father erected a wire fence along the boundary between the Land and the adjacent Lot 1309, from the north of the Land all the way down to the southern tip of the Land. However, in his witness statement, San Fat only refers to a wire fence being built by his Father and Mr. Tse at the area where the southern part of the Land connects with Lot 1309, so that the chickens would not roam into the Land from the chicken farm on Lot 1309. Fok Yuen said the same thing in his witness statement, referring to the southern part of the Land where it adjoins Lot 1309. The evidence of San Fat and Fok Yuen does not support the claim made in paragraph 6 of the Re-re-amended Defence and Counterclaim, that the fence extended all the way up from the southern tip to the north-eastern part of the Land, where the Land shares its border with Lot 1305.

32.According to the evidence of the current village or clan head, Mr. Lee Kam Kwan ("Mr. Lee"), who claims that as a boy, he had played with San Fat's elder brother on the Land, there was a wire mesh fence which had been erected between the Land and the chicken farm. However, it is Mr. Lee's evidence that the wire mesh fence ran from the north-eastern border of the Land, down one side of a mud track outside the Land, between Lot 1309 SA (which was still covered with lychee trees in 1978) and structures which had by then stood on Lot 1309SB. The wire fencing, according to Mr. Lee, then joined the southern border of the Land between the Land, and Lots 1309SC and 1309SD.

33.There is no sign of any fence or wire mesh in any of the aerial photographs from 1973 to 1996, nor in any of the topographic sheets of the period. A footpath is shown in the topographic sheet of 1986, and this appears to run from the road in the north-east corner of the Land, opposite Lot 1305, into the Land itself. This footpath is near the spot marked by Mrs. Ching to indicate where she gained access into the Land during her visits. According to Fok Yuen, there is a gate near this foot path.

34.Mr. and Mrs. Ching claim in their evidence that when they made their first visit to the Land prior to the purchase, there was some old and torn wire mesh fencing, some of which had already fallen down. They were about 4 feet high. Mr. Ching said he had to climb over a part of the fallen fence on his first visit, as he recalled tearing his trousers. Mrs. Ching claims that after the purchase in 1973, on her subsequent visits to the Land, she could see that her husband or his staff had repaired and strengthened the fencing, and on each of these visits, Mrs. Ching could just walk into the Land without difficulty, through an opening or door.

35.If San Fat or his Father had put up any wire mesh fencing, it is more likely on the evidence available that it was erected near the southern part of the Land, in conjunction with Mr. Tse who owned the adjacent Lot 1309 and the chicken farm there, to prevent chickens getting out of the chicken farm and into the Land. There is no other evidence of the existence of wire mesh fencing on other parts of the Land. Mr. Lee's evidence suggests that any other fencing further than the southern border shared by the Land and Lot 1309 was in fact outside the Land. His evidence makes sense, as such fencing would appear from the aerial photographs of 1973 to 1978 to separate the structures on Lot 1309SB (which form part of the chicken farm) from the area which was still covered by lychee trees, which extended beyond the Land, on the rest of the same Lot 1309SB.

36.In the joint expert report dated November 2010, the experts confirm that short sections of fences are recorded on the topographic sheets of 1978, "on and south of the southern boundary" of the Land. The experts agree that other than these, there were no details of any fences within the Land or surrounding it continuously at any time. The experts confirm that even from the topographic sheet of the Land of 1986, there were still no details of any fences or temporary structures within the Land. According to the Defendants' expert, there is a low retaining wall on the eastern side of the Land, with the remains of a concrete post and wire fence, but that the age of the wall is unknown as it does not appear on the 1986 topographic sheet nor can be seen from any aerial photographs. I regard this to be much too vague to be of value.

The Hut that Father built

37.It is claimed that in about 1980 or 1981, San Fat's Father built a small and simple wooden hut on the Land ("Hut"). This was for storage of the farming tools used by the Father and the Mother. According to San Fat, it was a very small shed, under 300 square feet in area. It was mainly to store tools, and would only be used by the Mother to sleep in when the lychees ripened, when she would spend the night in the Hut to prevent unauthorized persons entering the Land and picking the ripe lychees.

38.In none of the aerial photographs and topographic sheets of any period was any structure shown or marked on the Land which could correspond to the Hut.

39.Further, it is unclear from the evidence of San Fat and Fok Yuen where the Hut was allegedly built. By 1981 (when the Hut was allegedly built), San Fat would have been 27 years old, and Fok Yuen 24. According to San Fat's evidence on cross-examination, the Hut was located in the north-western part of the Land, near its border with Lot 1180. When cross-examined, Fok Yuen claims that the Hut was near the northern boundary of the Land, just south of its border with Lot 1185 to the north of the Land. According to the evidence of Mr. Lee, the Hut was around the boundary between the Land and Lot 1179 or Lot 1180 to the west of the Land.

40.When San Fat, Fok Yuen and Mr. Lee referred to their playing as children in the "lychee garden", and to the Hut standing under lychee trees, or to the wire mesh fence running along the "lychee garden", they could well have been referring to parts of the land in the area where lychee trees grew, but outside the Land: namely in either Lot 1180, Lot 1185, Lot 1309SA or 1309SB (all of which belong to members of the Leung family clan), or to Lot 1179B. As Mr. Pirie pointed out, it is unlikely that children playing under the lychee trees would make a clear distinction as to the different lots of land belonging to different lines of the family clan.

41.The evidence of Mr. Lee highlights the unreliability of the witnesses' references to simply the lychee trees, or the "lychee garden". Mr. Lee initially insisted that the Land was fenced off, but when he was asked to identify the area of the fence, he indicated an area well outside the boundary of the Land, to the edge of the area where the lychee trees grew in Lot 1309SA and 1309 SB. These areas were still densely covered by lychee trees until 1988.

42.I can find no reliable evidence to conclude that the Hut stood within the Land, as opposed to its being within Lot 1180 to the west of the Land, or within Lot 1185 to the north. The topographic sheets support the existence of temporary structures to the north of the Land in 1963, within Lot 1185 and 1186, and to the south-east, within Lot 1309 SA by 1973. However, there is no sign in the topographic sheets of any structure within the Land in or after 1981 which corresponds with the Hut.

43.In any event, it is not disputed that the Hut (which on San Fat's case was built only in 1981) did not exist by the time of the commencement of these proceedings in 2000. In fact, the evidence of Mr. Lee is that the Hut had been demolished by 1990, when Mr. Cheng commenced using the Land in his welding business.

Control of access

44.San Fat claims that in the 1960s when he and his Mother worked on the farmland near the Land, they would keep a lookout for people entering the lychee garden and stop them from picking the fruit from the trees. San Fat also claims that they would put baskets across the path leading into the lychee garden to block access into the lychee garden. As Mother worked in Lot 1178 and the area surrounding that, it is reasonable to infer that she would be looking out for people entering the adjacent area of the lychee trees, which grew in Lot 1180 adjacent to Lot 1178. Any basket or other items which San Fat claims were put by the Mother across the path leading into the lychee garden would most probably have been put at the entrance to the land where the lychee trees began to grow, namely, on Lot 1180 which shares its western border with Lot 1178.

45.San Fat's evidence is that when he was of primary school age (which would be in the 1960s), there was a row of low hedges at the perimeter of the "lychee garden". The hedges were 6 to 7 feet high, to prevent people entering the lychee garden to pick the fruit. The opening in the hedge led from the farmland at Lot 1178 adjacent to the lychee garden. Again, this raises the question of the border or perimeter of the area where the lychee trees grew. In all probability, the hedges at the border, if there were any at any given time, would have been outside the Land, as the lychee trees extended to the plots surrounding the Land: in Lots 1179 and 1180 to the east, Lots 1185 and 1186 to the north (until the early 1970s at least), Lot 1309SC to the south (part of Mother's Land until 1965), and Lot 1309SA, a part of Lot 1309SB, and a part of Lot 1305 to the west until the early 1980s. This does not constitute clear manifestation to an objective visitor to the Landthat entry into the Land is prohibited, or that access is being controlled by the Leungs to the exclusion of outsiders.

46.In fact, according to the evidence of Fok Yuen, access through the Land was possible from Lot 1307 at the south-west corner of the Land, to plots to the east of the Land such as Lot 1305. The "barbed trees" and shrubs which San Fat claims were planted at the western border of the Land did not appear from Fok Yuen's evidence to prevent people gaining access into the Land from Lot 1307, and were probably only in the area of Lot 1178 where Mother farmed.

47.The experts also agree in their Supplemental Joint Report dated March 2011 that although there appears from the aerial photograph of 1963 to be a darker line of vegetation along the eastern side of the Land to suggest some kind of hedge or shrub to which San Fat referred, there were breaks in the line which indicate access points or breaks in the vegetation. However, even this line of vegetation can be seen to be on the western border of Lot 1180, as opposed to the western border of the Land. The enclosure, if any, is of parts of the outer limits of the land on which the lychee trees grew, and not of the Land itself.

Cultivating the Land

48.It is claimed in the Re-re-amended Defence that since the 1960s, San Fat and his Father before him had cultivated the Land, in terms of weeding the Land, trimming the trees, applying fertilizer and reaping lychees for sale. From the aerial photographs of the Land taken in 1954, 1961 and 1964, mature trees could be seen to have covered the Land. The position remained unchanged in the 1970s.

49.According to Fok Yuen's witness statement which was filed in September 2010, it was only some time after the Small Hill Garden was sold under the Mortgage made by the Uncle, that the Father decided to claim the "lychee garden" as his, by way of compensation for having lost what was part of Mother's Land. San Fat claims that his Father had planted some lychee trees, and that thereafter, he had assisted in the weeding and fertilizing and had picked lychees to sell, until the Father died in 1984.

50.On the evidence, the Land was only sold under the Mortgage made by the Uncle on 31 March 1965. The earliest time that the Father would have learned of the loss of Small Hill Garden as a result of Uncle's gambling debts would have been April 1965, according to Fok Yuen's evidence on the quarrel he overheard. By 1982, San Fat and Fok Yuen had set up the Tai Tong Garden. Thereafter, on the evidence, they took lychees from the Land to sell at Tai Tong Garden, and grafted from the trees on the Land. It is more probable than not that after 1982, San Fat's family would have focused on the Tai Tong Garden which was on their own property, was larger in scale and was their own business, as opposed to the lychee trees on the Land which they knew had been sold to members outside the Leung clan. The Father died in 1984.

51.I do not accept that the mere picking of lychee fruit from trees on the Land, or the cutting of branches from the trees for grafting and growth elsewhere, even if done on a regular basis, can constitute continuous and exclusive possession or control of the Land. It is mere trespass, at most persistent trespass, and unauthorized destruction and appropriation of property.

52.The present case is distinguishable from Cadija Unna v. S Don Maris Appa [1939] AC 136 which is relied upon by Counsel for San Fat and Mr. Cheng. In Cadija Unna, the cutting and selling of grass from land in Ceylon which was to a great extent swampy and on which lotus and wild grass grew was held to be an act of possession, in circumstances where the grass was the only, or at least the main advantage accruing from the land. Land in Hong Kong is and was always been valuable, and even in the 1960s until the 1980s, it cannot be said that cutting branches and shoots, and picking lychees from the trees was the only or main advantage accruing from the Land.

53.As for any cultivation on the Land as the Leung family claim, in the nature of planting trees, clearing dead trees, weeding or fertilizing the trees or the Land, on the facts of this case, I consider that there should at the same time be some other act on the part of the Leungs of excluding the owner and the world at large, to the extent of exerting exclusive possession and control. As Slade J put it succinctly in the passage of his judgment in Powell v. McFarlane quoted in paragraph 6 above, "what must be shown as constituting factual possession is that the alleged possessor has been dealing with the land in question as an occupying owner might have been expected to deal with it, and that no one else has done so (my emphasis)." Following on from that, it has been said that on the question of physical possession, there must be open, single and effective exclusive control by the squatter.

54.I am not satisfied that the acts of the Leung family in their tending the Land from 1965 to 1982 or 1984, constitute open, single and effective exclusive control of the Land.

55.First, there is no clear boundary marking out the extent of the plot of the lychee trees they tended.

56.Further, Mr. and Mrs. Ching made at least annual visits to the Land between September 1973 and 1985. They and their family were able to obtain access to the Land during each of their visits. I accept their evidence that they detected no signs of occupation by third parties. As observed by Slade J, the slightest acts done by or on behalf of an owner will be sufficient to negative discontinuance of possession, whereas if a squatter's acts are open to more than one interpretation and he has not made it perfectly plain to the world at large by his actions or words that he has intended to exclude the owner as best he can, the courts will treat him as not having had the requisite animus possidendi, and consequently as not having dispossessed the owner.

57.By reason of the fact that Mr. and Mrs. Ching and their family were able to and did gain access to the Land between September 1973 and 1985, the lack of evidence of sufficient fencing or enclosure of the Land, and the lack of evidence of sufficient control of access by the public to the Land, I am not satisfied that the acts relied upon by the Leung family show that they had a sufficient degree of single, effective and exclusive physical control over the Land. The nature of the Land, its area and size, its location and surrounding land have all been taken into consideration in this context.

Granting leases over the Land

58.It is clear from the aerial photographs that by 1993, a large area of the Land had been cleared of trees and that there were non-agricultural activities on the Land. San Fat claims in his Re-re-amended Defence and Counterclaim that in 1988, he set up the business of a garage or workshop on Lot 1259 ("Business"), and parked vehicles on the Land. According to the records filed at the Business Registration Office, however, the Business did not commence until 1 July 1990.

59.San Fat also claims that from 1988 or 1990, he had let areas of the Land to Mr. Cheng for his welding business. Mr. Cheng on his part also claims that, at Fok Yuen's suggestion, he moved his welding business to the Land, and had been paying monthly rent to San Fat since 1988. However, in Mr. Cheng's Defence, it is pleaded that he had been occupying the Land under an oral tenancy agreement which was made with San Fat in August 1992.

60.I reject the claim made by San Fat that the oral tenancy with Mr. Cheng was made in 1988. The rental receipts and Mr. Cheng's own Defence contradict this. Mr. Lee's evidence is also that Mr. Cheng commenced to use the Land in 1990.

61.Although it would appear from the aerial photographs that there had been open acts of occupation of the Land after 1990 and before 1993, since the parties have accepted at trial that the requisite period of occupation by the Leung family is 20 years, any act of purported possession or control of the Land after 1990 is irrelevant to the Defence and Counterclaim in these proceedings. Any act which only commenced in 1988 is likewise not relevant.

Did San Fat and his family have the requisite intention to possess the Land to the exclusion of the world at large, including the registered owner?

62.The burden is on San Fat to prove that he and his family had made it perfectly plain to the world at large by their actions or words that they had intended to exclude the owner as best they can. If their actions are equivocal, the courts will treat them as not having had the requisite animus possidendi and consequently as not having dispossessed the registered owner.

63.It has to be borne in mind that according to Fok Yuen, his family had come to know in the 1960s that the Leung clan properties had been sold to third parties under the Mortgage made by the Uncle. If it was the intention of the Father, San Fat and his family to claim the Land as theirs, they should have known that they would have to take more overt acts to exert their possession of and control over the Land than before, as the Land was no longer owned and controlled by members of the same Leung clan, as it had been since at least the 1950s.

64.On the available evidence, I do not regard the Leung children playing on the Land in the early 1960s, the Leung family's picking of fruit, clearing of trees and working on parts of the Land, and their periodic cutting of branches or shoots from the trees on the Land in and after 1981 as sufficient manifestation of a clear and unequivocal intention that they intended to exclude the owner from the Land. This is particularly so when the Ching family were able to enter the Land between 1973 and 1985, and access into and through the Land was also possible from Lots 1307 and 1181 at least. Mr. Ching, Mrs. Ching, or any stranger entering the Land after 1973 would not have encountered any fence or other enclosure at the border of the Land to indicate to them, objectively and clearly, that entry was forbidden by someone else. Even if Mr. and Mrs. Ching were to have noticed any lychee fruit missing, or any tree having been tampered with (which they deny), they would have regarded it as annoying acts of trespass only.

65.I conclude that in respect of the acts relied upon by San Fat's family as possession, he has failed to establish that they clearly demonstrated to the world at large that they had the necessary intention of dispossessing the paper title owner.

66.In view of my findings on the facts in this case, I do not see any need to deal with the question of whether there is a divergence between Hong Kong law and English law as to the applicability of the concept of implied licences, and cases where the acts of the intruder do not substantially interfere with the plans of the registered owner for the future use of undeveloped land do not have any significant impact.

What are the damages payable by San Fat for his occupation of the Land?

67.According to San Fat's Answer to the Interrogatories served by the Plaintiff, he received rental from Mr. Cheng and other tenants for their use of the Land. On the basis of the rental admitted to have been received by San Fat, the Plaintiff claims the total sum of $1,080,000.

68.Since San Fat cannot establish that he has been in adverse possession of the Land, I accept that as a trespasser, he is liable to pay damages or mesne profits in respect of his occupation.  I regard the rental paid by the tenants as evidence of the reasonable market rent or value for the use of the Land, and allow the sum of $1,080,000 claimed.

Conclusion

69.In view of my findings, I will make an order for San Fat and Mr. Cheng to deliver up vacant possession of the Land to the Plaintiff within 3 months from the date of service of the Orders made under this Judgment, and for damages in the sum of $1,080,000 to be paid by San Fat within 28 days of the service of the Orders made under this Judgment.  San Fat’s Counterclaim is dismissed.

70.I will further make a costs order nisi that San Fat and Mr. Cheng are to pay the Plaintiff's costs of the original action and of the Counterclaim, with certificate for Counsel, to be taxed if not agreed. 

Mr. Francis Yip instructed by Messrs. Wong, Hui & Co. for the 12^th and 13^th Defendants