Chea Shiu Chow v. Cheung Chit Chiu and Another

HCA 1346/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1346 OF 2012

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BETWEEN

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D E C I S I O N

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1.This is an application for the intervener to be made a party to the Action as the 2^nd defendant.

Background

2.This action is a adverse possession claim commenced by the plaintiff on 31 July 2012 for Lot No 539 in Demarcation District No 84, North, New Territories, Hong Kong, and Lot No 440 in Demarcation District No 84, North, New Territories, Hong Kong (“the Land”).

3.The two defendants were the registered owners of the Land in the Land Registry.  However, it was not in dispute that both defendants had passed away in the 1960s and 1970s.

4.According to the plaintiff, he entered and took possession of the Land on 15 March 1995.  He said that he was not aware of any tenancy agreement all along between the Intervener as the Landlady and him as Tenant.

5.According to the intervener, who claims to be the daughter of one of the defendants, Cheung Chit Chiu: -

(a) The Land was an ancestral “tong” with descendants of the Cheung family as members.

(b) After the defendants passed away between 1962 and 1975, the Land remained to be managed in accordance with Chinese law and custom by the Intervener.

(c) There has been no application for statutory succession under the now repealed Section 17 of the New Territories Ordinance or the Intestates Estates Ordinance.

(d) The plaintiff has entered into a written Chinese tenancy agreement with the Intervener on 4 December 1994. (exhibit marked “CWK-5” in the affirmation of Cheung Wai Keung, the son and lawful attorney of the intervener).  The document showed the signature of the plaintiff as well as his contact details and Hong Kong Identity Card number.

(e) The plaintiff has been paying such rent until 23 February 2010.  Despite demands, the plaintiff has failed to pay the annual rent since.

(f) The intervener took out a claim in the Small Claims Tribunal for recovery of the arrears of rent on 11June 2012.

(g) In the defence in the said Small Claims Tribunal action, the plaintiff revealed that he has taken out the current action.

6.This, therefore, led to the current application, notwithstanding the fact that the plaintiff has not served the Writ in the current action.

The law on joinder application

7.Order15 r 6(1) and (2) reads as follows: -

“ 6. (1) No cause or matter shall be defeated by reason of the misjoinder or nonjoinder of any party; and the Court may in any cause or matter determine the issues or questions in dispute so far as they affect the right and interest of the persons who are parties to the cause or matter.

(2) Subject to the provision of this rule, at any stage of the proceedings in any cause or matter the Court may on such terms as it thinks just and either of its own motion or on application –

(a) order any person who has been improperly or unnecessarily made a party or who has for any reason ceased to be a proper or necessary party, to cease to be a party;

(b) order any of the following persons to be added as a party, namely –

(i) any person who ought to have been joined as a party or whose presence before the Court is necessary to ensure that all matters in dispute in the cause or matter may be effectually and completely determined and adjudicated upon, or

(ii) any person between whom and any party to the cause or matter there may exist a question or issue arising out of or relating to or connected with any relief or remedy claimed in the cause or matter which in the opinion of the Court it would be just and convenient to determine as between him and that party as well as between the parties to the cause or matter.

8.Thus, Order15 r 6 (2) (b) (ii) confers a rather low hurdle for joinder applications: – On one hand, whilst “A mere commercial interest in its outcome, divorced from the subject matter of the action is not enough”  (Wong Chun Loong Tony v Ada Ltd [1991] 1 HKC 86), on the other, even “a person with a doubtful interest in the subject matter of the litigation was allowed to be joined, so that the doubt over his interest could be resolved at trial together with the relevant issues between the original parties” (Man Whi Chung v Man Ping Nam & Anor [2003] 1 HKC).

9.The test thus would be whether the intended joinder has an interest, even if doubtful, in the subject matter of the litigation, and not a mere commercial interest in its outcome.

Matters in dispute

10.This is an action on adverse possession, thus the “subject matter of the litigation” in this case is (1) who is the actual owner of the Land and (2) whether the plaintiff can claim adverse possession of the Land.

11.The main dispute between the parties is whether the intervener is “sufficiently interested” in this Action.

12.It is the intervener’s case that she is the owner of the Land, relying on Article 88(2) of the Qing Code which stated, as translated in Jamieson, Chinese Family and Commercial Law: -

“In the event of a family becoming extinct for want of legal successors, the daughters shall be entitled to the property, and if there are no daughter, the property shall be forfeited to Government.”

13.Mr Chong, Counsel for the intervener, has taken me through the Court of Appeal Judgment of Liu Ying Lan v Liu Tung Yiu & Another [2003] 3 HKLRD.  He showed that, provided that certain conditions were fulfilled, the intervener could claim title of the Land under the concept of succession under the Chinese law and Qing Code.

14.One further point Mr Chong raised is the preclusion of posthumous adoption of adult male since 1973 so there was no way for someone to claim title in this manner now.  I think the latter is not very relevant in the current application as no one else is claiming the title via posthumous adoption.

15.Mr Chong also argued that the intervener was claiming to be the plaintiff’s landlord and would be entitled for to resist the plaintiff’s claim for a declaratory relief in the Land and to seek redress for breach of the alleged tenancy agreement for an order for possession.

16.The arguments advanced by Mr Ling for the plaintiff against the application was one of lack of evidence to show that the intervener’s claim satisfies the conditions under the concept of succession under the Chinese law and Qing Code.  So far, no evidence (e.g. Birth Certificates) has been produced to show that, eg the intervener was indeed the daughter of Cheung Chit Chiu, or that there was no male descendants within the same kindred (eg no brothers or nephews) etc.

17.I am of the view that all these arguments go to the question of whether the claim to title by the intervener was “doubtful”, and none can satisfy me that the intervener has mere “commercial interest” in the subject matter of the litigation: the intervener has advanced a way to claim the title of the Land, the evidence needed to prove such a claim is for her to produce at a later stage of the proceedings.

18.The subject matter of this action is an adverse possession claim on the title of the Land.  It is unjust if a party who may lay claim to the title is depraved of the chance to be heard before the trial judge, even if that claim may seem “doubtful”.

19.At the very least, as the intervener is claiming to be the landlord, the dispute in the tenancy agreement should also be dealt with in the same proceedings.  The intervener’s Small Claims action for recovery of outstanding rent should be transferred to the High Court to avoid duplicity of action especially if she is now further seeking an order for vacant possession.

20.Ms Ling also argued that since the Writ has not been served, it is premature for the intervener to make the current application.

21.I agree with Mr Chong’s argument that Order 15 rule 6(2) provides the Court discretion to join any party “at any stage of the proceedings”.  A Court proceeding is commenced by the issue of the writ (and not by the service of the writ) so the application is not premature.

22.What appears to be premature is for the intervener to prepare a draft Defence and Counterclaim and to seek an order, at this stage, for its service (as stated in paragraph (b) of her Inter Partes Summons).  The plaintiff has not served the writ, let alone a Statement of Claim.

Order

23.I would therefore give the following orders: -

(a)  The intervener be made a party to the action as the 2^nd defendant pursuant to Order 15 rule 6(2) RHC.

(b)  There be an order nisi for: -

(i)  Costs of and occasioned by the joinder application be to the intervener with certificate for Counsel.

(ii)  Costs of and occasioned by the preparation of the Intervener’s draft Defence and Counterclaim and the application for service thereof be costs in the cause.

(c) If no application is made to vary the above cost order within 14 days of this Decision, and if costs under paragraph 23(b)(i) above is not agreed, the said costs will be summarily assessed by the Court by paper disposal as follows: -

(i)  The intervener is to submit to Court a statement of costs within 7 days thereafter and serve the same to the plaintiff;

(ii)  The plaintiff is to submit a list of objections to Court within 7 days thereafter.

Ms Ebony Ling, instructed by Cheung & Yip, for the plaintiff

Mr K M Chong, instructed by Edmund Cheung & Co, for the intervener