CACV 271/98 and 61/99
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF APPEAL
CIVIL APPEAL NO. 271 OF 1998 AND 61 OF 1999
(ON APPEAL FROM HCA 5782 OF 1994)
|FAIRVIEW PARK PROPERTY MANAGEMENT LIMITED
|SUN WAI CHUN
Coram: Hon Chan, CJHC, Nazareth V-P and Keith JA in Court
Date of Hearing: 1 December 1999
Date of handing down Decision: 4 January 2000
D E C I S I O N
1. This is an application by the defendant for leave to appeal to the Court of Final Appeal against the judgment of this Court given on 11 August 1999. It is made under s.22(1)(b) of the Court of Final Appeal Ordinance (Cap. 484) in respect of the discretionary power to grant leave both as a question of great general or public importance, and in the alternative as one that otherwise ought to be submitted to that Court for decision.
2. For the purpose of addressing the application, the material facts can be stated quite shortly. The defendant is the owner of a semi-detached house in Fairview Park, Yuen Long. One of her predecessors in title made substantial alterations to five walls of the house. The plaintiff company, which manages Fairview Park under a Deed of Covenant ("the DMC") has for some considerable time been attempting to secure reinstatement of the house to its original form. At least one of the defendant's predecessors in title, and indeed the defendant herself, have at different times agreed to effect such reinstatement and have sought additional time to do so from the plaintiff. Ultimately, the plaintiff commenced the present legal proceedings claiming injunctions to compel the defendant forthwith to effect the restorations in question, a declaration that the defendant indemnify the plaintiff against all damages resulting from the defendant's breaches, and in the alternative an order that the defendant allow the plaintiff to enter into the premises and itself to effect the work and recover the costs from the plaintiff. The action came before Waung J in the Court of First Instance. He found for the plaintiff and granted the plaintiff a prohibitory injunction restraining the defendant from hindering or preventing the plaintiff from entering into the house and carrying out the reinstatement works. He also ordered the defendant to indemnify the plaintiff in respect of the costs and expenses of carrying out the reinstatement works. Finally, he ordered the defendant to pay costs of HK$1,600,000 and HK$133,000 assessed by way of gross sum assessment under O62 r9(4)(b) of the Rules of the High Court.
3. Of the numerous grounds originally relied upon in the application for leave, Sir John Swaine SC, who with Mr Simon Yip appears for the defendant, and who came late into the case, relies upon only one: that upon a proper construction of the DMC and the Estate Rules ("the Estate Rules") made thereunder, it was only the owner who had made the alterations that was liable to restore them or in default to pay the costs of their reinstatement by the plaintiff ("the construction point"). It has to be said that prima facie those documents do appear to have the effect contended for and that upon that basis the defendant would be entitled to succeed. And that seems to be reflected in the relief granted by the judge by way of prohibitory injunction as opposed to mandatory injunction and in the partial reliance by this Court upon the construction point not having been pleaded. Sir John submits that the construction point is a question of great general and public importance.
4. For the plaintiff it is contended that the point was never pleaded. This, Sir John disputes, submitting that the point was pleaded by a general traverse. To properly consider his submission, it is necessary to see how the matter is said to have been pleaded. By its Re-Re-Amended Statement of Claim, the plaintiff pleaded that by provisions of the DMC and the Estate Rules which it specified, alterations were not to be made to the house without its written approval; that a particular provision of the Schedule to the DMC gave the plaintiff power to remove illegal structures and alterations and to demand and recover the costs and expenses of removal from the owner; that by the Estate Rules these powers can be enforced against the defendant; and that despite repeated demands and requests, the defendant and her predecessors had failed and refused to remedy the breaches.
5. In response to those detailed averments, what Sir John proffers as the defendant's pleading of the construction point is a bare traverse in the following terms in paragraph 3 of the re-amended defence:
"3. Paragraphs 3 to 8 of the Re-Re-Amended Statement of Claim are not admitted."
This, it is submitted, is a sufficient traverse of the plaintiff's detailed pleading and suffices to raise the specific point now relied upon, i.e. that the particular predecessor in title who effected the unauthorised alterations is liable and not the defendant. On appeal, this Court took the view that the point was not pleaded. It said so at p.9 of its judgment. Moreover, the point was not included in the summary or list of points in issue made by the judge. The defendant and her counsel had the opportunity of asking for its inclusion but did not do so. Consequently the judge did not address it, nor did the Court of Appeal.
6. Mr Ronny Wong SC, who with Mr Johnson Lam, also appeared for the plaintiff below, in strenuously opposing Sir John's reliance on the point, submits also that had the point been pleaded and taken, he would have adduced relevant factual evidence and made additional submissions. In particular, he referred to the defendant's acceptance that she was liable to make the restorations and to the extension of time that she had sought and obtained.
7. Taking another point, he submits that the construction point does not raise a question of great general or public importance. It seems to me that this must be right given the absence of any evidence that deeds of mutual covenant and similar estate or other rules so plainly deficient in their practical effect are common in Hong Kong. Their impracticality, in apparently confining liability and reinstatement obligations to the particular owner who effected the offending alterations, obviously thereby seriously undermining their enforceability, must suggest that they are unlikely to be used to any significant extent.
8. Sir John also had a second submission which ran thus. The proper construction of the DMC and the Estate Rules plainly shows that the defendant is not liable to reinstate the house or to indemnify the plaintiff for carrying out the reinstatement works. The position is so clear that there is a manifest injustice to the defendant, upon the basis of which the construction point is a question that ought to be submitted to the Court of Final Appeal for decision. In respect of that submission, Sir John also relied upon the following authorities. First, Archer v The Hong Kong Channel Ltd 1 HKLRD 829, in reliance upon which he submitted that "an error of law is manifest upon the face of the Judgment" here in the defendant being held liable for the wrong of a predecessor contrary to the DMC, and that the defendant has suffered injustice. While the Appeal Committee of the Court of Final Appeal in their judgment in Archer did refer to an "injustice" characterising it as a "glaring injustice", and while it is manifest from their judgment that the result represented an error of law, I do not think those features identified by Sir John can be fairly regarded as the ratio of the Court's decision there. It seems to me to...