Lee Bing Cheung v. Secretary for Justice

CACV 53/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 53 OF 2013

(ON APPEAL FROM HCA NO. 1092 OF 2010)

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BETWEEN

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REASONS FOR JUDGMENT

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Hon Cheung JA :

The appeal

1.1  Houses No. 29, 29A and 29B, Ah Kung Ngam Village Road (formerly known as No. 3, 3A and 3B, Ah Kung Ngam Main Steet), Shaukeiwan, are three adjoining houses (‘the new houses’).  Houses No. 29 and 29A are situated on Ah Kung Ngam Lot No. 28 (‘Lot 28’) while House No. 29B is situated on a piece of Government land.  Lot 28 was first assigned by the then Hong Kong Government to Cheung Yung Fat (張容發) on 1 January 1894 for 999 years.  After Cheung Yung Fat died, Lot 28 was assigned to Cheung Wan Po (張韻波) who eventually assigned it to the plaintiff on 1 April 1952.  At the time of the assignment to the plaintiff in 1952, there were already three adjoining houses (‘the old houses’) at the location where Houses No. 29, 29A and 29B are situated.  The plaintiff claimed that he had entered into possession of the old houses well before the assignment on 1 April 1952.  He did so in February 1949 pursuant to a lease granted to him by a Madam Cheung.  The plaintiff in May 1952 rebuilt the old houses and the new houses now standing there came into existence in September 1952.

1.2   By a writ issued on 19 July 2010 (later amended on 25 October 2010), the plaintiff claimed, among other things, that he had been in possession of the Government land where House No. 29B is situated and had acquired a possessory title on 28 February 2009 to the Government land by reason of sections 7 and 17 of the Limitation Ordinance (Cap. 347).  Deputy High Court Judge Marlene Ng found that the plaintiff had entered into possession of the Government land since 1 March 1949.  Based on the doctrine of encroachment, the Judge held that the plaintiff is entitled to possession of the Government land until the determination of the grant of Lot 28.  The Government land which had been taken back by the Government on 29 January 2010 was ordered by the Judge to be delivered back to the plaintiff.  The Judge dismissed the defendant’s counterclaim for damages by reason of the plaintiff’s wrongful occupation of the Government land. 

1.3   The defendant appealed against the judgment.  We dismissed the appeal at the conclusion of the hearing.  I now give the reasons for our judgment.

History of the plaintiff’s possession of Lot 28 and the Government land   

2.1  The Judge found that the plaintiff was truthful and reliable on the core issue of how he came to be in possession of the Government land from at least 1 March 1949.

2.2   The plaintiff was born in 1913.  At the time of the trial he was nearly 100 years of age.  He came from a well-to-do family in Guangdong in the Mainland.  He received secondary education and was a qualified land surveyor working for the then Nationalist government.  Due to the unrest brought about by the change of government in the Mainland, the plaintiff decided to move to Hong Kong in February 1949 with his wife and three children.  Through the help of a friend from his home town who had settled in Hong Kong earlier, the plaintiff managed to rent the property in Ah Kung Ngam Main Street from a Madam Cheung.  At that time Ah Kung Ngam was still a fishing village.  Ah Kung Ngam Main Street was close to the sea with shipyards and wooden houses occupied by fishermen.  The description of the leased property on the photocopy of the rental receipt dated 1 March 1949 issued by Madam Cheung was「亞公岩地段28號大街門牌第三號石牆木屋樓全間」(Translation : Ah Kung Ngam Lot 28 Main Street House No. 3, the whole of the stone wall wooden house).  The monthly rent was $8 and the transfer fee to take over the property was $500.  The original of the rental receipt was lost and the genuineness of the photocopy was not challenged by the defendant. 

2.3    The property that the plaintiff leased from Madam Cheung consisted of three adjoining houses.  He had no idea that one of the houses was located on Government land.  The plaintiff moved into the property in February 1949 and from then to April 1952, he rented the property from Madam Cheung.  On 1 April 1952 he bought the property from the owner Cheung Wan Po who was also living in Ah Kung Ngam Street for $7,000. After the plaintiff bought the property he decided to rebuild it.  He built three adjoining houses each of two-storey high on the same site.  They were named as No. 3, 3A and 3B, Ah Kung Ngam Main Street.  In about 1954, they were renamed as No. 29, 29A and 29B, Ah Kung Ngam Village Road.

2.4   After 1956, the plaintiff and his family moved to live in Sai Ying Pun and let out the three houses.

2.5   In 2008, the ground floor of House No. 29B was let to a tenant.  In 2009 the tenant applied to the Government for planning permission to use the premises as an eating place. Permission was refused on the ground that the House No. 29B was built without permission on Government land.  On 29 January 2010, the Government took possession of the Government land upon which House No. 29B is situated.

The law

3.There is not much controversy about the law.  In Hong Kong, the limitation period for the Government to seek recovery of its land is 60 years from the date on which the right of action accrued (section 7(1) of the Limitation Ordinance).  The consequence of the expiry of the limitation period is that the title of the owner is extinguished (section 17 of the Limitation Ordinance). However, where the doctrine of encroachment is engaged i.e. a tenant who encroaches upon adjoining or adjacent land (in this case the Government land) beyond the boundaries of the land demised to him by his lease (namely, Lot 28 with the Government as the landlord), a rebuttable presumption arises that the encroached land has been occupied as an addition to the landlord’s land and the right to possession vests in the landlord at the end of the lease.  See Secretary for Justice v Chau Ka Chik Tso (2011) 14 HKCFAR 889 (at paras. 17 and 20, per Ribeiro PJ).

The defendant’s challenge

1) Challenge on finding of fact

4.1  While there was no challenge that the plaintiff was in possession of the Government land from 1952, the defendant challenged the Judge’s finding that the plaintiff had entered into possession of the Government land earlier from at least 1 March 1949. 

4.2   The defendant accepted the principles laid down in the well established case of Ting Kwok Keung v Tam Dick Yuen (2002) 5 HKCFAR 336 regarding challenge to finding of fact by a trial judge.  It, however, contended that the Judge had erred in her finding because she had overlooked or misappreciated some material evidence (see Universal Dockyard v Trinity General Insurance Co Ltd [1989] 2 HKLR 160 and A Solicitor v The Law Society of Hong Kong CACV 302/2002, 18 February 2004 (unreported)).

2) The plaintiff’s evidence on the roof

5.1  The plaintiff’s evidence was that when he took over the property, the three houses were dilapidated and damaged as a result of the Second World War in Hong Kong.  There was no proper roof over the three houses.  The roof was removed by the Japanese occupation force to clamp down against resistance by the local population.  Only House No. 29B on the Government land was covered by a makeshift roof made of wood and tar sheets although part of the kitchen was not covered so that the smoke from wood cooking could be allowed to escape.  There was no roof on the other two houses. 

5.2   The makeshift roof over House No. 29B was damaged and not well kept.  In March 1949 the plaintiff repaired this roof but he did not use new materials for the repair because building materials were scarce.  From about June, July 1949, he started to repair the other two houses, including putting up a roof, as and when he could find building materials such as wood, tar or asbestos sheet.  The work took several months.

3) The defendant’s argument

6.1  The defendant referred to the cross-examination of the plaintiff, in which he

(1)  first marked a small cross on exhibit P1 (which showed the ground floor of the new House No. 29B on the 1952 building layout plan) to indicate the location of the door to the old house (i.e. No. 3B) in February 1949 i.e. through the northwestern wall of the house;

(2)  then drew the dotted line and the large cross mark on exhibit P1 to depict the area within the old house which had a roof over it in February 1949; and

(3)  unequivocally confirmed that the roof over the old house, as at February 1949 when he first moved in, extended from the dotted line all the way down to the northwestern wall of the house.

6.2   The defendant argued that the plaintiff’s evidence that as at February 1949, (1) the roof of the old house No. 3B extended all the way to the northwestern wall and (2) the door to that house was through the northwestern wall contradicted the undisputed evidence on the state of the northwestern wall as at 8 May 1949 which was the date of the aerial photographs.  In this regard, as recorded in paragraph 69 of the judgment below, the experts agreed that the aerial photographs showed that the supporting walls had been partly damaged.

6.3   The defendant argued that the Judge was mistaken that the defendant’s challenge was based on the cross marks made by the plaintiff on the plan.  It submitted that it did not invite the Judge to draw any inference from the cross marks.  Rather, the submission was premised upon the plaintiff having himself given evidence that as of February 1949, the old house No. 3B had a roof that extended all the way down to, and a door through, the northwestern wall.  In other words, the Judge rejected the defendant’s submission on the basis that the plaintiff was not saying that the roof of that house extended all the way from the dotted line right up to the northwestern wall.  But this was precisely what he said, not (as the Judge thought the defendant contended) because of what one could infer from the large cross mark. 

6.4   The defendant submitted that :

(1)  The plaintiff’s account of the physical condition of the old house No. 3B (including the roof and the door thereof) as at February 1949 was critical to the determination of his primary case that he entered into occupation of the same in about February 1949.

(2)  If the plaintiff has given a description of that house in February 1949 which is demonstrated to be wrong or improbable, this should mean that his evidence of his possession is not reliable.

(3)  The inconsistency between the plaintiff’s evidence in relation to the roof and door of that house and the uncontroversial expert evidence on the state of the northwestern wall of that house as shown in the photographs should therefore have impacted upon the Judge’s assessment of the plaintiff’s case on the ‘core issues’.

(4)  There is no reason to ignore the plaintiff’s evidence in this regard.  None has been given, which suggests that that evidence was simply overlooked or misappreciated.

(5)  Had the Judge appreciated that it was the plaintiff’s own evidence that as of February 1949, the roof of the old house No. 3B extended from the dotted line down to the northwestern wall, she should and would have realised that that would most likely be wrong, given the common ground regarding the then condition of the northwestern wall.

(6)  The Judge has therefore misdirected herself as to the effect of the plaintiff’s evidence, and/or had come to a conclusion which was contrary to the plaintiff’s own evidence (which was never controverted by anyone) that she had overlooked or misappreciated.

(7)  The wholesale acceptance of the plaintiff’s evidence is therefore plainly wrong, and it ought to have been held that the plaintiff has not discharged his burden of proof (given that the evidence adduced by the plaintiff must be compelling in that it would suffice to establish both factual possession and an intention to possess on the balance of probabilities).

4) The Judge’s finding

7.The Judge made the following finding : 

‘ 118. Mr Man places emphasis on the layout drawing on which the plaintiff marked (a) the location of the main entrance in the middle of the northwest front wall of House No 29B and (b) the area from the house frontage of House No.29B to the kitchen/open area at the rear to indicate the whereabouts of the makeshift roof cover.

119.  Mr Man submits that the plaintiff’s evidence is inherently implausible because there would not have been a main entrance through the remaining lower parts of the partially collapsed northwest front wall (2-3ft high), and also the low height of the northwest front wall would not have supported a roof cover that extended all the way to the kitchen/open area.  Mr Man says the plaintiff’s assertions that he worked on the roof over House No 29B to cover it with tar sheets and to make it tidy (“整齊”) do not sit well with what can be readily seen on Enlarged 6091, namely, that any roof over House No 29B would not have extended fully right up to the northwest front wall.

120.  In my view, such submission reads too much into the layout drawing marked by the plaintiff. During the trial, as a matter of convenience, I invited the plaintiff to use the 1952 layout plan for the New Building as if it were a layout drawing of Houses Nos 29, 29A and 29B as at February/March 1949 for diagrammatic illustration of his oral evidence.  The plaintiff was expressly told to ignore the precise architectural features/details (eg the new walls) of the New Building.  Against such background, the large cross mark made by the plaintiff on the layout drawing at best depicts a rough reference to the approximate area within House No 29B that had a makeshift roof in contra-distinction to the kitchen/open area that was without any roof.

121.  It will be reading too much into the large cross mark made by the plaintiff to say it represents a full-length rectangular-shaped roof that extended all the way from the kitchen/open area to lean on top of a full height northwest front wall completely covering the whole area from corner to corner.  This is borne out by the plaintiff’s evidence that the makeshift roof was in fact damaged when he first moved in, but he did not use any new material when he “tidied” it up to prevent water [seepage].  In my view, the plaintiff only did a patch up job so that his family could quickly live and sleep underneath.  Further, even as early as the 1st Deposition (ie before the Joint Meeting and any knowledge of the 6091 Photo) the plaintiff already said the damaged stone walls had partially collapsed leaving only half of the walls still standing.  In the circumstances, in marking up the layout drawing the plaintiff would not have meant that the makeshift roof actually leaned on a full-height northwest front wall.  Further, I have no difficulty in accepting that in those difficult times when living in dilapidated houses was better than sleeping under staircases, an aperture through a partially collapsed stone wall (presumably where the main door would have been) would be regarded as the main entrance.

122.  In the circumstances, I do not find the plaintiff’s evidence inherently inconsistent.  I have warned myself that the evidence must be compelling and that I should regard self-serving statements with caution, but in light of the above analysis and the discussion below I find the plaintiff’s evidence reliable and credible.’

My view

1) Historical context

8.In order to deal with the defendant’s challenge, it is important to understand the historical context of the location of these three houses.  That three adjoining houses had already been built on Lot 28 and the Government land next to it from the time when the plaintiff said he took over them in 1949 can hardly be challenged.  In the 1918 Lease, the existence of a house on the Government land represented by a rectangle next to Lot 28 is shown on the attached plan.  In the counterpart of the lease of Ah Kung Ngam Lot No. 24 dated 4 September 1918, there was also a plan of Lot 24.  On it was an annotation made in 2010 of specifically House No. 29B situated next to Lot 28 (represented by two rectangles). There was also a 1927 plan found in the Government Survey and Mapping Office which identified these three houses.  The locations, orientations, setting and dimensions of these houses appeared to be about the same as the three existing houses.  The aerial photographs of 8 May 1949 also showed the three houses. The plaintiff’s evidence was that the new houses were built in 1952 on the same foundation of the three old houses.  A 1993 survey report found in the Survey and Mapping Office contained the following information :

‘ The lease plan 1 (appendix 12), prepared in 1910, showed that the lot was located at the north west direction of lot 1. The lot number 28 was annotated on the house which had a partition wall near its centre. The house appeared on the plan 1845, plan 1914 and plan 1927. Its dimensions scaled off from the plan 1927 agreed with that written on the Block Crown Lease schedule. The current owner said that he purchased the land with ruins on after the war (air photos 1949). He said the new house was rebuilt based on the ruins left on the ground. He had no idea that the area of the lot should be about two third of his house now standing on the site.’

2)  The plaintiff’s evidence

9.1  The plaintiff is the only witness who had given direct evidence on the circumstances he entered into possession of Lot 28 and the Government land.  The photocopy rental receipt he produced, the authenticity of which was not challenged (and, in any event, can hardly be challenged) supported his case that he took possession from at least 1 March 1949.  Given the historical context in which the old house No. 3B in the Government land had been shown to be in existence side by side with the old houses in Lot 28 (i.e. Houses No. 3B and No. 3), one may ask if it is really so unreasonable or inherently improbable for the plaintiff to have believed that the property he leased in 1949 consisted of the three adjoining houses? Is it really so unreasonable or inherently improbable that he would patch up the makeshift roof in the old house No. 3B which was the only house that had a roof over it so that he and his family could have some place to live.  As the Judge said, she had no difficulty in accepting that in those difficult times when living in dilapidated houses was better than sleeping under staircases, an aperture through a partially collapsed stone wall (presumably where the main door would have been) would be regarded as the main entrance.

9.2   I disagree that the Judge had misunderstood the defendant’s submission concerning the marks the plaintiff had made on the 1952 layout plan or his evidence on the extent of the roof in the old house No. 3B.  As the Judge had pointed out in paragraph 120 of the judgment that I have quoted, the big cross that the plaintiff made only represented the approximate area of the makeshift roof in that house.  While the Judge had only referred to the mark made by the plaintiff and not specifically to his oral evidence that the roof extended all the way to the northwestern wall, the oral evidence which followed from his marking which represented the rough extent of the roof, must also be considered as only the approximate extent of the roof.  Further, the Judge’s reference (paragraph 121 of the judgment) to the plaintiff’s evidence given in the 1^st Deposition that the damaged stone walls had partially collapsed leaving half of the walls still standing would serve to refute the defendant’s argument that the plaintiff’s oral evidence could only mean the roof was leaning on a freestanding northwestern wall which was contradicted by the expert evidence that this wall had already collapsed.  One must also bear in mind the plaintiff’s evidence that the house had stone walls built from the ground level to the level of a person’s waist and there was a wooden structure above the wall.  The plaintiff’s evidence could not possibly have suggested that the roof was leaning against a freestanding wall.

9.3   More importantly, the May 1949 aerial photographs did not contradict the plaintiff’s evidence that there was such a makeshift roof in the old house.  Although the Judge did not accept the evidence of the plaintiff’s expert that a rudimentary roof over the houses could be seen from the aerial photographs, she also did not accept the evidence of the defendant’s expert that the photographs showed that scrubs and trees had grown from the inside of the houses.

9.4   The Judge at paragraph 51 of the judgment held that,

‘ ….bearing in mind the plaintiff’s advanced age, his limitations in hearing and eyesight, his slowness at times in understanding the questions that were put to him, and his need to read and speak slowly, I find him forthcoming and reasonably articulate on his personal experiences, and he was unshaken on these matters even under cross-examination. But he does not remember extraneous matters (eg the Joint Meeting as referred to in paragraph 53 below) well, and I do not believe he changed and/or tailored his evidence as Mr Man suggested. On balance, I find the plaintiff to be truthful and reliable on the core issues, and in particular I accept his evidence in relation to his use and occupation of the Government Land, House No 3B and New House No 29B.’

9.5   The Judge had the benefit of observing the plaintiff giving evidence which this Court had not.  The answers given by the plaintiff must clearly be considered in the context in which they were given.  In my view the Judge had properly evaluated the evidence and could not be faulted.

Other grounds of appeal

10.The upholding of the Judge’s finding that the plaintiff had possessed the Government land since 1 March 1949 renders it unnecessary to consider the defendant’s challenge on the Judge’s decision on proprietary estoppel.

Hon Kwan JA :

11.I agree with the Reasons for Judgment of Cheung JA.

Hon Chu JA :

12.I agree with the reasons given by Cheung JA.

Mr K M Chong and Mr Aidan Tam, instructed by Au, Thong & Tsang, for the plaintiff

Ms Lisa Wong SC and Mr Bernard Man, instructed by Department of Justice, for the defendant