CACV77/2023 WHOLE GRAND LTD v. THE INCORPORATED OWNERS OF BO FUNG BUILDING - LawHero
CACV77/2023
上訴法庭（民事）Kwan VP, G Lam and Chow JJA8/7/2024[2024] HKCA 626
CACV77/2023
A A
CACV 77/2023, [2024] HKCA 626
B B
On Appeal From [2021] HKLdT 50
C IN THE HIGH COURT OF THE C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D D
COURT OF APPEAL
E CIVIL APPEAL NO 77 OF 2023 E
(ON APPEAL FROM LDBM NO 57 OF 2019)
F F
____________
BETWEEN
G G
WHOLE GRAND LIMITED Applicant
H (Appellant) H
and
I I
THE INCORPORATED OWNERS Respondent
J J
OF BO FUNG BUILDING (Respondent)
K
____________ K
L Before: Hon Kwan VP, G Lam and Chow JJA in Court L
Date of Hearing: 20 February 2024
M M
Date of Judgment: 9 July 2024
N N
_________________
O JUDGME NT O
_________________
P P
Hon Kwan VP:
Q Q
1. I agree with the judgment of G Lam JA.
R R
S Hon G Lam JA: S
T 2. The appellant (“Whole Grand”) is the owner of, inter alia, T
Shops 4 and 5 on the G/F, the Cockloft, and the whole of the 1/F of Bo Fung
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A A
Building (“Building”) situated at 5 Horse Shoe Lane, Kwun Tong,
B B
Kowloon. The respondent is the Incorporated Owners (“IO”) of the
C Building. This appeal which is brought against a judgment of the Lands C
Tribunal concerns the right of Whole Grand to use a lift at the 1/F.
D D
E Background E
F 3. The Building, erected in 1992, is a commercial-cum- F
residential building. The occupation permit, issued on 26 June 1992,
G G
specified the following uses for the different levels of the Building:
H H
Ground Floor: shops (non-domestic use)
I I
Cockloft: storage (non-domestic use)
J 1st Floor: shop (non-domestic use) J
K 2nd Floor: day nursery & transformer room (non- K
domestic use)
L Podium: roof garden, generator room and L
service rooms (non-domestic use)
M M
3rd to 25th Floors: 4 flats per floor for domestic use (there
are no 4th, 14th and 24th Floors)
N N
O O
4. On 21 July 1992, a deed of mutual covenant (“DMC”) was
P
entered into between (1) the first owners, (2) Cherub Ltd as the “Manager”, P
and (3) The Financial Secretary Incorporated as the assignee of the day
Q Q
nursery on the 2/F. The Building is divided into three portions under the
R DMC, called “Residential Development”, “Commercial Development”, R
and “Day Nursery”.
S S
T
5. There are three lifts in the Building. The one in issue in these T
proceedings is labelled “Lift A” in the building plans and referred to as such
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A A
below. For convenience I shall refer to the other two lifts as “Lift B” and
B B
“Lift C” respectively. To gain access to the three lifts, one has to key in a
C passcode at the entrance of the Building, open the gate and then go through C
a corridor in order to reach the lift lobby.
D D
E 6. From the outset the three lifts had served different floors as E
follows:
F F
G - Lift A served G/F, 1/F, 3/F, 7/F, 9/F, 11/F, 13/F, 16/F, 18/F, G
20/F, 21/F and 25/F
H H
- Lift B served G/F, 3/F, 5/F, 8/F, 10/F, 12/F, 15/F, 17/F,
I 19/F, 21/F and 23/F I
J - Lift C served G/F and the Day Nursery on 2/F J
K 7. In the original configuration of the Building, in order to go to K
the 1/F, one could either (1) go through the main entrance of the Building
L L
at the G/F and take Lift A or walk up the common staircase behind the lift
M shafts; or (2) walk up the steps inside Shop 1 (on the G/F) which lead to the M
Cockloft and then the 1/F.
N N
O 8. Shortly after the Building was completed, certain alteration O
plans affecting Shops 4 and 5, the Cockloft and the 1/F were approved by
P P
the Building Authority on 15 December 1992. The alterations
Q (“Alterations”), which were carried out presumably not long after the plans Q
were approved, involved converting part of Shops 4 and 5 into an entrance
R R
lobby on the G/F that opened to Horse Shoe Lane (“Entrance Lobby”). An
S S
internal one-way escalator (“Escalator”) together with a stairway in
T
parallel (“Stairway”) were installed to connect the Entrance Lobby and the T
Cockloft. The Entrance Lobby, the Cockloft and the 1/F, all of which fall
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A A
within the Commercial Development of the Building, will be referred to as
B B
the “Property”.
C C
9. After the Alterations, one can make use of the Escalator-
D D
Stairway to access the Cockloft from the Entrance Lobby. From the
E Cockloft, one can use the pre-existing staircase (located above Shop 1) to E
access the 1/F.
F F
G 10. By an assignment dated 1 February 2010, Whole Grand G
acquired, inter alia, the Property,1 which was at the time let to a tenant who
H H
operated a restaurant there called “Fu Lin Wah Seafood Restaurant” (“Fu
I Lin Wah”). I
J J
11. In late 2009, the Escalator broke down and could not be
K immediately repaired due to the lack of suitable parts that needed to be K
imported. Fu Lin Wah’s staff disclosed the passcode of the Building’s main
L L
entrance to their customers so that they could take Lift A to access Fu Lin
M Wah on the 1/F. The frequent use of Lift A by Fu Lin Wah’s customers M
resulted in complaints from the residents of the Building.
N N
O 12. At a meeting on 16 July 2010, the Owners’ Committee of the O
Building (there being no incorporated owners then) passed a resolution
P P
(“Resolution”) that the customers of Fu Lin Wah shall not be allowed to
Q use the lifts of the Building and that lawyers would be instructed to Q
implement the arrangement in accordance with the provisions of the
R R
DMC. Whole Grand’s representative attended the meeting but did not raise
S any objection. Accordingly, in around October 2010, Lift A was adjusted S
T T
1
The assignment covered Shops 1, 2, 3, 4, 5, 6 and 7, the Cockcroft, the whole of the 1/F, and Flat A
on the 3/F.
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A A
so that it would no longer stop at the 1/F. A notice published by the
B B
Manager on 19 October 2010 stated that if access to Lift A at the 1/F was
C needed in an emergency, the management staff could be approached for that C
purpose.
D D
E 13. Fu Lin Wah did not make any complaint to Whole Grand about E
the closure of Lift A on the 1/F, and vacated the Property after its tenancy
F F
expired on 30 November 2011.
G G
14. From 10 December 2011 to 9 December 2017, the Property
H H
was let by Whole Grand to another tenant, Jointed-Heart Ltd (“Jointed-
I Heart”), who operated a rice noodle restaurant there. It is not clear exactly I
when the Escalator was eventually repaired, but the evidence, which was
J J
apparently uncontroversial, was that by the time Jointed-Heart took
K possession of the Property, the Escalator was operating normally and had K
never since broken down due to disrepair. Jointed-Heart did not make any
L L
request for Lift A to resume serving the 1/F, and Whole Grand therefore
M likewise did not take any action about the cessation of service of Lift A for M
the 1/F.
N N
O 15. After Jointed-Heart vacated the Property in December 2017, O
Whole Grand began looking for suitable tenants and in the course of doing
P P
so, received offers from prospective tenants who required lift service
Q between the G/F and the 1/F as a condition for taking up a tenancy of the Q
Property. Whole Grand therefore requested the Manager to reactivate the
R R
service of Lift A for the 1/F. The response to these requests was apparently
S S
delayed because an owners’ corporation for the Building was being set up
T
at the time. The IO was eventually incorporated on 22 August 2018. Whole T
Grand thereafter requested the IO for Lift A to resume serving the 1/F. The
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A A
IO responded by asking Whole Grand to obtain formal legal advice to show
B B
that it had the right to use the Lift A.
C C
16. On 4 January 2019, Howell & Co, solicitors instructed by
D D
Whole Grand, wrote to the IO stating that Whole Grand was entitled under
E the DMC to use Lift A for the proper enjoyment of the Property and that E
the IO had failed to discharge its duties under the DMC and the Building
F F
Management Ordinance (Cap 344) (“BMO”), deprived persons with
G disability of the use of a lift contrary to section 72 of the Building (Planning) G
Regulations (Cap 123F) (“BPR”) and section 28(2) of the Disability
H H
Discrimination Ordinance (Cap 487) (“DDO”), and created a fire hazard by
I depriving the Property of the use of a firemen’s lift. The solicitors I
demanded that the IO forthwith allow access by Whole Grand, its tenants,
J J
servants, agents and licensees to Lift A and admit liability for breaches of
K K
duties and agree to compensate Whole Grand for its losses.
L L
17. The IO at a meeting on 17 January 2019 resolved to seek free
M legal advice from the Home Affairs Department and other sources before M
coming to a decision.
N N
O 18. On 15 March 2019, Whole Grand instituted proceedings O
against the IO in the Lands Tribunal (“Tribunal”).
P P
Q 19. Since 2 July 2019, the Property had been leased to a new tenant Q
on a 4-year lease for another restaurant business, called “窩心八鮮蒸鍋”.
R R
On 28 September 2019, there was an incident at the restaurant. A disabled
S S
customer in a wheelchair was carried by others to the restaurant on the 1/F
T
but, when he left, for safety reasons he could not be similarly carried down T
to the G/F and had to take the lift instead. The person-in-charge at the
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A A
restaurant made a request to the Manager who initially refused the request
B B
on the ground that the IO had decided not to allow the Lift A to serve the
C 1/F. The request was eventually acceded to after a more senior person in C
the Manager intervened.
D D
E 20. On 18 October 2019, the Manager issued a notice stating that E
the IO had since the incident of 28 September 2019 instructed that if there
F F
is a fire or injury or if there is a need from disabled and wheelchair-bound
G persons, it will be treated as an emergency and the caretaker will make G
Lift A accessible to the 1/F for use by the relevant persons.
H H
I The parties’ cases I
J 21. Whole Grand’s case in the Tribunal as set out in its Amended J
Notice of Application was as follows.
K K
L (1) Lift A is within the definition of “Common Areas” of the L
Building in the DMC and within the definition of “common
M M
parts” in the BMO. It forms part of the Commercial
N
Development and also part of the Residential Development in N
the Building. Under the DMC, the owners for the time being
O of any Commercial Units, their tenants, servants, agents, O
lawful occupants and licensees have the right to use and enjoy
P P
the lift service provided by Lift A for going between the 1/F
Q and the G/F. Q
(2) The rights and authorities of the Manager are subject to the
R R
provisions of the DMC including its duty to prevent
S obstruction of the Common Areas. S
T (3) The closure of Lift A is wrongful and contrary to the T
provisions of the DMC. By closing Lift A to the 1/F in August
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A A
B
2010, the Owners’ Committee and the Manager acted in B
breach of:
C C
(a) various provisions of the DMC;
D D
(b) section 2 of the BMO, in that Lift A is within the
E “common parts” of the Building; E
(c) section 72 of the BPR and section 78 of the 3rd Schedule
F F
to the BPR, in denying access to a lift for the disabled;
G G
(d) section 28(2) of the DDO, in discriminating against
H persons with a disability; H
(4) The liabilities arising from the closure of Lift A were
I I
transferred to and to be borne by the IO upon its incorporation.
J J
(5) The IO breached its duties under section 18 of the BMO by
K adopting the closure of Lift A. K
L
(6) Whole Grand had received offers from prospective tenants to L
rent the Property at a monthly rent of $255,000 or $250,000
M subject to the availability of access to Lift A. As a result of M
the IO’s breaches, Whole Grand lost those prospective
N N
tenancies. It claims damages for lost rental income between
O April and August 2018 in the sum of $1.04 million and also O
for reduced rental income over the term of the current tenancy
P P
in the sum of approximately $1.03 million.
Q Q
22. By way of relief, Whole Grand claimed:
R R
(1) a declaration that Whole Grand as owner of the Property, its
S tenants, servants, agents, lawful occupants and licensees shall S
have the right to use and enjoy Lift A as part of the Common
T T
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A A
B
Areas under the DMC and/or as a common part under the B
BMO;
C C
(2) a declaration that the IO has no power under the DMC or
D otherwise to deny Whole Grand, its tenants, servants, agents, D
lawful occupants and licensees the access to and use and
E E
enjoyment of Lift A as part of the Common Areas and/or
F
common parts; F
(3) a declaration that the IO has no power under the DMC or
G G
otherwise to close access on the 1/F to Lift A as a lift for the
H disabled and a firemen’s lift; H
I
(4) an order that the IO do forthwith reinstate the lift service I
between the G/F and the 1/F by re-opening access to Lift A on
J the 1/F for the use and enjoyment of Whole Grand as owner of J
the Property, its tenants, servants, agents, licensees and lawful
K K
occupants of the Property; and
L L
(5) damages, including loss of rental income.
M M
23. The IO’s case in the Tribunal as set out in its Re-Amended
N Notice of Opposition was as follows: N
O O
(1) It is admitted that Lift A is part of the “Common Areas” of the
P
Building under the DMC. But by virtue of clause 3.2.1 of the P
DMC, an owner of a Commercial Unit is not entitled to use
Q Lift A because it forms part of the Residential Development. Q
R (2) Since late 2009, the then owner or tenant of the Property had R
failed to maintain the Escalator, causing many of its customers
S S
to take Lift A for access between the G/F and the restaurant.
T
As a result, nuisance, annoyance and/or disturbance was T
caused to the owners and residents of the Building.
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A A
B
(3) Pursuant to the powers under the DMC, the Owners’ B
Committee made the House Rules or passed the Resolution
C that the owners of the Commercial Development shall not C
enter the Building except the Commercial Development and
D D
Lift A shall not stop at the 1/F except in emergency. In so
E doing, the Owners’ Committee set aside, allocated and/or E
assigned Lift A for the exclusive use of the G/F, Podium, 5/F,
F F
7/F, 9/F, 11/F, 13/F, 16/F, 18/F, 20/F, 22/F and 25/F.
G (4) Alternatively, the Manager has power under the DMC to set G
aside, allocate and/or assign Lift A to those floors.
H H
(5) The House Rules or Resolution were made taking into account
I I
a number of matters including security concerns. They were
reasonable and proper measures made by the Owners
J J
Committee and implemented by the Manager and binding on
K all the owners of the Building. K
L (6) After its incorporation, the IO adopted, confirmed and/or L
continued to implement the House Rules or Resolution.
M M
The Tribunal’s judgment
N N
24. The case was tried before Deputy District Judge Michelle
O O
Soong sitting as the Presiding Officer of the Tribunal (“judge”). On
P 30 July 2021, the Tribunal issued its judgment (“Judgment”).2 P
Q Q
25. The judge dealt first with the IO’s contention that Whole
R Grand, as the owner of a Commercial Unit, was excluded from Lift A being R
S S
T T
2
[2021] HKLdT 50.
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A A
part of the Residential Development. The IO’s argument was based on
B B
section 3 of the DMC. Clause 3.2 provides as follows:
C C
“ 3.2 Commercial Units
D 3.2.1 The Owner of a Commercial Unit shall have the D
benefit of the following easements, rights and privileges
E subject to the provisions and restrictions contained in this E
Deed, the House Rules and subject to the rights of the
Manager as hereinafter provided and to the payment by the
F Owner of his due proportion of the Manager’s F
Remuneration and management expenditure:-
G (a) Full right and liberty (but subject always to G
the right of the Manager and the Assignor
H hereunder) for the Owner for the time being, H
his tenants, servants, agents, lawful
occupants and Licensees (in common with all
I persons having the like right) to go pass or I
repass, over and along and to use such of the
Common Areas forming part of the
J J
Commercial Development and not those
forming part of the Residential Development
K for all purposes connected with the proper K
use and enjoyment of such Commercial Unit.
L … L
3.2.2 The Owners of the Commercial Units shall have no
M right to enter upon any part of the Land and the Building M
save as expressly herein provided, …” (underlining added)
N N
26. “Residential Development” is defined in clause 1.1 of the
O O
DMC to mean “the Units on the Floors above the Second Floor Level of the
P Building and/or any other parts of the Land and the Building intended for P
residential use.”
Q Q
R
27. The IO submitted that Lift A was intended for residential use R
and because it formed part of the Residential Development, Whole Grand
S S
as the owner of a Commercial Unit was excluded from it by virtue of
T clause 3.2.1. The judge rejected this argument and held that Lift A T
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A A
(including the lift lobby) was intended for common use by the residential
B B
3
and commercial units including the 1/F.
C C
28. The judge went on to note that the Alterations had taken place
D D
which had obviously enhanced the conspicuousness and accessibility of the
E 1/F, but that there was no information on whether they were done with the E
consent of the Manager and the other owners of the Building and, if so, on
F F
what basis consent was given.4 At §59, the judge stated:
G G
“ In my view, even if the DMC originally intended, upon its
drafting and execution, that Lift A should serve 1/F, that
H H
intention was obviously based on the original design of the
Building with a correspondingly smaller number of visitors to
I 1/F which could be reasonably absorbed by the capacity of the I
lift lobby and the lift without causing much problems to the
residential owners. But since the Alterations have virtually
J J
changed what I would describe metaphorically as ‘the
ecology’ of the Building by substantially increasing the
K conspicuousness and accessibility to 1/F and the potential K
number of visitors thereto, in my view it is no longer meaningful
for the parties to place their entire focus on whether the
L applicant’s use of the lift was permitted or not permitted under L
the DMC.”
M M
29. The judge also noted that after the Alterations, outsiders
N N
including customers could easily gain access to the 1/F through the
O Entrance Lobby and then to Lift A or the common staircase and in turn to O
any floor of the Residential Development. The Alterations had opened up
P P
a major loophole in the security system of the Building, with or without lift
Q service to the 1/F. With the availability of a lift, the difference is just a Q
matter of degree.5
R R
S S
3
Judgment, §§49-52.
T T
4
Judgment, §§54-58.
5
Judgment, §§60-62.
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A A
30. The judge went on to observe that there might have been a
B B
breach of clause 5.1.4 of the DMC which prohibited structural alterations
C that interfered with or affected the rights of other owners, since the C
Alterations compromised the security system and overloaded the capacity
D D
6
of Lift A and the lift lobby.
E E
31. Further, the judge noted that the Escalator fell into disrepair in
F F
late 2009 and the 1/F restaurant then gave the passcode for the main
G entrance of the Building to the customers, resulting in overcrowding of the G
lift lobby, competition and conflicts from the use of Lift A as well as
H H
security concerns, and arguably a breach of clause 5.1.9 of the DMC, which
I provides: I
J J
“ No Owner shall do or permit or suffer to be done and each
Owner shall take all possible steps to prevent his tenants
K occupiers or licensees from doing any act deed matter or thing K
which in any way interferes with or affects or which is likely to
interfere with or affect the proper management and maintenance
L of the Building.”7 L
M M
32. The judge noted that under the express terms of clause 3.2.1 of
N
the DMC, the right of the owner of a Commercial Unit to use the Common N
Areas is “subject to the provisions and restrictions contained in this Deed,
O O
the House Rules and subject to the rights of the Manager as hereinafter
P provided.” Clause 6.2.1 confers a wide power on the Manager to manage P
the Building, as follows:
Q Q
“ The Manager will manage the Land and the Building in a proper
R manner and in accordance with this Deed and except as R
otherwise herein expressly provided the Manager shall be
responsible for and shall have full and unrestricted authority to
S do all such acts and things as may in its opinion be necessary or S
T T
6
Judgment, §§63-65.
7
Judgment, §§66-69.
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A A
requisite for the proper management of the Land and the
B Building. Without in any way limiting the generality of the B
foregoing the Manager shall have the following duties and
powers namely:-
C C
…
D D
(i) To prevent the obstruction of all the Common Areas and
to remove any article or thing causing obstruction …
E E
(o) To do all things which the Manager shall in his absolute
discretion deem necessary or desirable for the purposes of
F maintaining renewing and improving all facilities and F
services in or on the Building for the better enjoyment or
use of the Building by its Owner occupiers and their
G G
licensees.
…
H H
(ai) To allocate and/or assign any lift for the exclusive use of
I particular floors and/or Units where the circumstances so I
warrant.”
J J
33. The judge stated that even if Whole Grand’s right to use Lift
K A is wholly unaffected by the Alterations, its right is not an absolute and K
unqualified one. It cannot assert an absolute right to use Lift A without
L L
regard to the potential breach of the DMC (i.e. clauses 5.1.4 and 5.1.9) on
M its part, the inconvenience and interference caused to other owners, and the M
Manager’s obligation and power to manage to Building properly and
N N
8
protect the interests of other owners.
O O
34. The judge noted that the exercise of rights in the multi-unit
P P
building context must be subject to an element of reasonableness, and that
Q it appeared that Whole Grand was not challenging the reasonableness of the Q
closure of Lift A as a measure to tackle the security and overcrowding
R R
concerns. Assuming such reasonableness was in issue, the judge said she
S did not think the measure taken was unreasonable. She found the IO’s S
T T
8
Judgment, §§70-75.
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A A
security and nuisance concerns to be real and valid. It was incumbent on
B B
Whole Grand to take a more proactive approach to deal with the problems
C caused by the Alterations, instead of treating compliance with the DMC as C
merely the tenant’s own responsibility. Whole Grand had simply asserted
D D
a full and unrestricted right to use Lift A, without showing any willingness
E to accommodate any reasonable measures proposed by the IO. In E
conclusion the judge did not consider it unreasonable for the Manager and
F F
9
the IO not to provide lift service to 1/F in light of all the circumstances.
G G
35. In the end, although the judge agreed with Whole Grand on the
H H
construction of clause 3.2.1 of the DMC, she declined to make any
I declaration since Whole Grand was asserting an absolute and unrestricted I
right. She stated that should Whole Grand wish to have the lift service
J J
reinstated, they should interact with the IO reasonably with a view to
K K
addressing the valid concerns of other owners before prematurely seeking
L
redress from the court. As the judge did not find any breach of the DMC L
by the IO, no damages were awarded. Accordingly, the judge dismissed
M M
Whole Grand’s application with costs.10
N N
Whole Grand’s appeal
O O
36. Under sections 11(2) and 11AA of the Lands Tribunal
P P
Ordinance (Cap 17), an appeal lies from a judgment of the Tribunal to the
Q
Court of Appeal on an error in point of law, with leave of the Tribunal or Q
the Court of Appeal. In a decision dated 6 January 2023, the judge refused
R R
S S
T T
9
Judgment's, §§76-90.
10
Judgment, §§102-105.
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A A
to grant Whole Grand leave to appeal.11 On 3 March 2023, Chow JA grant
B B
leave to appeal.
C C
37. The grounds advanced by Whole Grand for the appeal may be
D D
stated broadly as follows:
E E
(1) The Tribunal traversed beyond the pleadings and went into the
F F
unpleaded Alterations in reaching its decision.
G (2) The true issue was the binary question of whether or not Whole G
Grand as an owner of Commercial Units has the right to use
H H
Lift A. If Lift A is a common area or common part, Whole
I Grand has a right to use it and the IO has no power to remove I
that right. This question is to be determined as at the execution
J J
of the DMC. Post-agreement conduct and statements are
irrelevant. Once the Tribunal concluded that when the DMC
K K
was executed on 21 July 1992 it was intended that Lift A
L should serve 1/F, that should have been the end of the analysis L
and should have resulted in the determination of dispute in
M M
Whole Grand’s favour.
N N
(3) The Tribunal erred in holding that the analysis does not end
with the construction of the DMC, and in holding that the
O O
“ecology” of the Building was changed by the Alterations.
P Whole Grand has the right to remove the Alterations at any P
time. The Alterations could not result in a different
Q Q
interpretation being given to the right of Whole Grand to use
R Lift A under the DMC. R
(4) The Tribunal was wrong to consider the Alterations an adverse
S S
factor against Whole Grand. The Alterations were at most a
T T
11
[2023] HKLdT 2.
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A A
B
neutral factor because, among other things, the 1/F had always B
been intended to be for commercial use; the Alterations were
C lawfully carried out pursuant to approved Alterations and C
Additions Building Plans; the way the 1/F was used as a
D D
restaurant did not involve any breach of the DMC; and the
E Alterations provided an alternative entrance to the 1/F, helping E
to reduce reliance on the common parts of the Building, and
F F
did not amount to an abandonment by the Property’s owner of
its right to use Lift A.
G G
(5) The IO did not counterclaim for any breach of the DMC by
H H
Whole Grand. The Tribunal was not asked to adjudicate and
I did not make any finding on any breach of the DMC by Whole I
Grand. In any event, Whole Grand’s right to use Lift A was
J J
not dependent on the absence of breach of the DMC.
K (6) The Tribunal erroneously shifted the burden to Whole Grand K
in saying that it was incumbent on it to deal proactively with
L L
the problems caused by the Alterations. It was for the IO to
M justify its conduct in depriving Whole Grand of the right to use M
Lift A.
N N
(7) The Tribunal was wrong to find that the measure taken by the
O IO was reasonable. The IO did not merely impose restrictions, O
but deprived Whole Grand of the right to use lift service
P P
completely.
Q Q
(8) The Tribunal failed to examine the overall impact of the
measure imposed and determine whether a fair balance have
R R
been struck between the collective interest and the individual
S rights encroached upon. S
T (9) The Tribunal erred in failing to take account of the impact of T
the BPR and DDO.
U U
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A A
B
(10) The Tribunal’s refusal to grant declaratory relief was plainly B
wrong. There existed a real issue between the parties, and
C Whole Grand had and still has a genuine interest in obtaining C
a declaration against the IO.
D D
38. The IO has filed a respondent’s notice contending that the
E E
three declarations sought by Whole Grand (see §22(1)-(3) above) were
F F
correctly refused because there was no total denial of Whole Grand’s right
G
to use Lift A and the chairman of the IO had stated in his witness statement G
that Lift A could be used for the 1/F: (1) in case of fire or personal injury;
H H
(2) by wheelchair-bound disabled persons; (3) by those with mobility
I problems; and (4) in any situation where ordinary people would consider it I
necessary.
J J
K
39. I shall deal in turn below with the contentions advanced. K
L Ground 1 – the pleading objection L
M M
40. Counsel for Whole Grand submit that the judge was wrong to
N
traverse into the Alterations which were wholly unpleaded, even though N
there may have been evidence on the subject. It is the pleadings that define
O O
the issues for determination by the Tribunal and not the other way round.
P P
41. I do not accept this argument. While the IO’s Notice of
Q Q
Opposition did not refer to the Alterations as such, it referred to the
R
Escalator and the Stairway extensively which were created by the R
Alterations – see §§9(a), (f)(i), (ii) and (vi). It was stated that as a result of
S S
the failure to maintain the Escalator, large numbers of the customers of the
T restaurant used Lift A for access, causing security and overcrowding T
U U
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A A
concerns for the residents of the Building. For its part, Whole Grand
B B
responded to those matters in its Reply.
C C
42. The notices of application and opposition are not pleadings as
D D
such. Section 10(5)(a) of the Lands Tribunal Ordinance provides that “the
E proceedings of the Tribunal shall be conducted with as much informality as E
is consistent with attaining justice”. Direction No 4 given by the President
F F
of the Lands Tribunal on 1 July 1986 states that presiding officers should
G not regard Notices as in the nature of pleadings by which parties are bound, G
but as an indication of the issues which are likely to be raised. Nevertheless,
H H
basic fairness requires that there should be advance notice of the points
I taken and issues raised and that no party should be prejudiced by being I
taken by surprise and having to deal with issues raised without a proper
J J
opportunity of preparing for them: see Grand Power v Chan Sing Hoi [2020]
K K
2 HKLRD 142, §§27-42; Great Source Enterprise Ltd v Sino Estates
L
Management Ltd (CACV 253/2003, 7 May 2004), §§14-17. The L
application of this principle – and the rigour with which ordinary rules of
M M
pleading may be applied by analogy – will of course depend on the facts
N
and the procedures adopted in the particular case. N
O O
43. In the present case, what the judge did was to take account of
P
the state of the Property and the Building as they existed at the time of the P
litigation (i.e. after the Alterations) – which she described as the “ecology”
Q Q
of the Building – in considering how the rights of Whole Grand and the
R other owners are to be balanced and what powers of management the R
Manager and the IO have and how they are to be exercised. In so doing she
S S
did not in my view traverse into unpleaded matters.
T T
U U
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A A
44. It was revealed in the course of trial, in particular during the
B B
cross-examination of the IO’s witness, that the existing configuration of the
C Property was not the original design of the Building but the result of C
substantial alterations done subsequent to its completion. In so far as the
D D
judge raised the unpleaded question whether consent for the Alterations was
E given by the Manager and/or the other owners on the understanding that E
henceforth the occupants and visitors of the Property should use the
F F
12
Escalator and the Stairway as their primary means of access, she noted
G G
that there was no evidence at all in that regard, and did not pursue this
H
further in her reasoning. H
I Grounds 2 and 3 I
J 45. Counsel for Whole Grand submit that the judge was wrong in J
K
holding that the Alterations changed the “ecology” of the Building and that K
it was “no longer meaningful” for the parties to focus on whether the use of
L L
Lift A was or was not permitted under the DMC. Instead, counsel submit,
M
the issue is a binary question of the construction of the DMC and BMO as M
to whether or not Lift A is a common area and common part. Post-
N N
agreement conduct is irrelevant to the construction of the DMC. Shops 4
O and 5 can be sold separately from the rest of the Property and the Alterations O
reversed, as Whole Grand wishes. The judge’s analysis would suggest that
P P
the right of the Property’s owner to use Lift A was lost upon carrying out
Q the Alterations in 1992. This cannot be right. Q
R R
46. I do not agree that the finding that Lift A is a common area or
S common part is the end of the analysis as Whole Grand contends. It is true S
that the IO had taken the position that Lift A was part of the Residential
T T
12
See Judgment, §58.
U U
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A A
Development and, as such, categorically excluded by virtue of clauses
B B
3.2.1(a) and 3.2.2 of the DMC from the common areas to which a
C commercial unit owner had any right of access. That interpretation is wrong, C
as the judge held. A declaration to that effect might have been made if that
D D
was what Whole Grand had claimed.
E E
47. But that was not what Whole Grand claimed. The orders it
F F
sought (see §22 above) assert a categorical and absolute right to the use of
G Lift A. Its case run before the Tribunal was squarely based on such absolute G
right: see §§79, 89 and 104 of the Judgment; see also §13, 14, 15 and 17 of
H H
the judge’s decision refusing leave to appeal. At §14 of the latter, the judge
I recorded: I
J J
“ … at trial I specifically asked the applicant’s Counsel to confirm
whether the applicant was still seeking an absolute and
K unrestricted right to use the lift by that time. Mr Ho answered K
in the affirmative during his closing submissions. …”
L L
48. The judge did not accept that Whole Grand had any such
M absolute right free from any power of restriction. DMCs are subscribed to M
by owners in multi-unit buildings for the purposes of “regulating by
N N
contract their rights inter se regarding the exclusive use and occupation of
O the units allotted to their respective parcels of undivided shares, their use of O
the common parts of the building, as well as their mutual obligations on
P P
such matters as management charges”: Kung Ming Tak Tong Co Ltd v Park
Q Solid Enterprises Ltd (2008) 11 HKCFAR 403, §19. As a matter of general Q
principle, the rights to the use and enjoyment of common areas and facilities
R R
“are not absolute and must as a matter of construction be subject to an
S S
element of reasonableness and also must coexist with other provisions in
T
the DMC unless specifically excluded”: Music Advance Ltd v Incorporated T
Owners of Argyle Centre Phase I [2010] 2 HKLRD 1041, §14; approved
U U
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- 22 -
A A
by this court in Silver Triumph Ltd v Guardian Ltd (HCMP 566/2012,
B B
18 May 2012), §17.
C C
49. Further, the DMC in respect of the Building contains express
D D
words in clause 3.2.1 making the right of a commercial unit’s owner to use
E the Common Areas subject to the provisions and restrictions contained in E
the DMC, the House Rules, and the rights of the Manager provided in the
F F
DMC. Clause 4.4.1 confers on the Manager “full right and authority to
G control and manage the Common Areas and Common Facilities”. Clause G
6.2.1 gives the Manager “full and unrestricted authority to do all such acts
H H
and things as may in its opinion be necessary or requisite for the proper
I management of the Land and the Building.” Such power must of course be I
exercised in good faith, reasonably, and not for improper purposes.
J J
K 50. From the outset, therefore, Whole Grand’s predecessor-in-title K
did not have an absolute and unqualified right to use the common areas by
L L
itself, its tenant or its licensees in whatever way they thought fit and without
M regard to the effect on the other owners. There is no question of it having M
“lost” such right through carrying out the Alterations. Nor did the Tribunal
N N
rely on the Alterations, which was admittedly something that occurred after
O O
the DMC, for the purpose of construing it.
P P
51. It is plain that the reasonableness of the restrictions imposed
Q has to be judged with reference to the prevailing circumstances. There is in Q
my view nothing erroneous for the Tribunal to have regard to the
R R
Alterations and other subsequent events in assessing what courses of action
S S
were properly open to the Manager and the IO under the DMC in terms of
T
restriction on access to Lift A at the 1/F. Should Whole Grand sell Shops T
4 and 5 separately with the result that the Escalator and Stairway are
U U
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A A
removed, no doubt that would be a material circumstance for the Manager
B B
and the IO to take into account in the exercise of their powers, and for the
C Tribunal to consider if there is a dispute. C
D D
Ground 4
E E
52. Counsel for Whole Grand submit that the Alterations are at
F most a neutral factor. They are internal to the Property and do not disturb F
the common parts. They have been in place since 1992, 18 years before
G G
Lift A was closed to the 1/F. If anything, they provide an alternative and
H additional access route to the 1/F through the Entrance Lobby, and reduce H
the need for occupants and visitors to rely on the common parts for access
I I
to the 1/F. The Alterations fall far short of any clear and unequivocal
J abandonment of the right to use Lift A. J
K K
53. I do not see that any error of law in the Judgment has been
L shown in connection with this ground. No one has suggested that the L
Alterations gave rise to an abandonment of right on the part of Whole Grand
M M
or its predecessor-in-title. The fact that the Alterations were internal to the
N N
Property and done in accordance with approved building plans and the fact
O
that the 1/F has from the beginning been intended for non-domestic use do O
not mean that there cannot be nuisance or security concerns caused to other
P P
owners. It is speculative to suggest that the Alterations have reduced the
Q
number of visitors using the common parts, since, without the Alterations, Q
there might have been far fewer visitors to the 1/F in the first place. The
R R
fact based on unchallenged evidence is that the Escalator broke down for a
S substantial period of time between 2009 and 2010 and Fu Lin Wah’s staff S
gave the passcode of the main gate of the Building to its customers, leading
T T
U U
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A A
to overcrowding and security concerns, which the Tribunal found to be “real
B B
and valid”. 13
There is no appeal from this finding.
C C
54. It is true that Lift A did serve the 1/F for many years before
D D
2009. This suggests that even with a restaurant operating at the 1/F, there
E may be scope for relaxing the restriction if a reasonable and acceptable E
solution can be found. This is why the judge was singularly unimpressed
F F
by the extreme but misconceived stance of Whole Grand that it has an
G absolute right incapable of being restricted and also by the “none of my G
business” attitude of Whole Grand’s representative towards its tenant’s
H H
compliance with the DMC.14
I I
55. I do not see any error of law in the Tribunal taking into account
J J
the Alterations and what had happened as shown in the evidence.
K K
Ground 5
L L
56. This ground criticises §75 of the Judgment where the judge
M M
stated: “The applicant could not assert the use of lift as an absolute right
N without any regard [to] the potential breach of the DMC provisions [i.e. N
clauses 5.1.4 and 5.1.9] on their part …” Counsel for Whole Grand submit
O O
that there was no counterclaim by the IO or finding by the Tribunal that
P Whole Grand had breached the DMC. Even if there was a breach, the DMC P
does not provide as a condition precedent that Whole Grand must first
Q Q
comply with its duties in order to be entitled to use Lift A.
R R
S S
T T
13
Judgment, §81.
14
See Judgment, §§85-90.
U U
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- 25 -
A A
57. In my view the criticism is misplaced. The judge was careful
B B
not actually to find any breach of clauses 5.1.4 and 5.1.9 of the DMC by
C Whole Grand, there being no counterclaim or allegation by the IO to that C
effect. It is correct that there is no provision in the DMC that compliance
D D
by an owner with his obligations is a condition precedent to the enjoyment
E of his rights thereunder. But with respect the argument misses the point, E
which is that, as explained above, the right in question is not absolute but
F F
subject to an element of reasonableness, to the other provisions of the DMC,
G G
and to the powers of managements conferred on the Manager and the IO.
H
The fact that Whole Grand or its tenant has engaged in conduct that may H
interfere with the enjoyment by the other owners of their rights is plainly a
I I
matter that the judge was entitled to take into account.
J J
Ground 6
K K
58. By Ground 6 it is contended that the judge wrongly shifted the
L L
burden by holding (in §85 of the Judgment) that it was incumbent on Whole
M
Grand to take a more proactive approach to deal with the problems caused M
by the Alterations.
N N
O
59. I do not think any error of law is made out. First, reading the O
sentence attacked in the context of §§84-86 of the Judgment, it is clear that
P P
what the judge found unsatisfactory is that Whole Grand was simply
Q
interested in letting out its Property and paid no regard whatsoever to the Q
use of the common parts of the Building by the tenant and its visitors. What
R R
the judge meant was that compliance with the DMC, such as in terms of not
S causing nuisance to the other owners, is a matter for Whole Grand as the S
owner, who cannot absolve itself simply by leaving everything to the tenant.
T T
This observation cannot be faulted. Plainly an owner is responsible under
U U
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A A
the DMC if his tenant interferes with the enjoyment by the other owners of
B B
their property. For example, clause 5.1.9 provides that “each Owner shall
C take all possible steps to prevent his tenants occupiers or licensees from C
doing any act deed matter or thing which in any way interferes with or
D D
affects or which is likely to interfere with or affect the proper management
E and maintenance of the Building.” E
F F
60. Secondly, the relevant sentence in the Judgment does not
G concern the burden of proof in the litigation. What the judge criticised and G
rejected in the wider context of §§84-90 is Whole Grand’s uncompromising
H H
position that it had an absolute and untrammelled right. This is relevant to
I the judge’s overall consideration of the reasonableness of the restriction I
imposed.
J J
K 61. Thirdly, in any event, even on the question of burden of proof K
itself, I do not think it entirely accurate for counsel to submit that the burden
L L
lies on the IO to justify its conduct. Whole Grand brought the proceedings
M for declarations and an injunction, claiming an absolute right. In response, M
the IO took the position that Whole Grand had no right at all to use Lift A
N N
but that in any event the right, if any, was subject to the powers of the
O O
Manager or the Owners Committee or the IO under the DMC. It was
P
averred that the Resolution in 2010 was made pursuant to those powers. In P
reply, Whole Grand averred that the Resolution was “unreasonable,
Q Q
wrongful, unlawful and in breach of the DMC”.15 The general principle of
R law is that he who asserts must prove: see e.g. Wong Hon Sun v HKSAR R
(2009) 12 HKCFAR 877, §23.
S S
T T
15
Amended Reply, §§8 & 9.
U U
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- 27 -
A A
Grounds 7 and 8
B B
62. Whole Grand contends that the judge erred in holding that the
C C
measure adopted by the IO was not unreasonable because the IO did not
D merely impose restrictions, but deprived Whole Grand of the right to use D
lift service completely. It is submitted that there is no power under the
E E
DMC for the IO or the Manager to deprive Whole Grand of the right to use
F Lift A. It is further submitted that the judge failed to examine the overall F
impact of the measure imposed and to decide whether a fair balance has
G G
been struck between the general interest and the individual rights in
H H
question.
I I
63. As mentioned above, clause 4.4.1 of the DMC gives the
J Manager “full right and authority to control and manage the Common Areas J
K
and Common Facilities”, and clause 6.2.1 gives it “full and unrestricted K
authority to do all such acts and things as may in its opinion be necessary
L L
or requisite for the proper management of the Land and the Building”.
M
Clause 6.2.1 goes on to provide: M
N “ Without in any way limiting the generality of the foregoing the N
Manager shall have the following duties and powers namely: –
O … O
(ai) To allocate and/or assign any lift for the exclusive use of
P particular floors and/or Units where the circumstances so P
warrant.
Q …” Q
R 64. Counsel for Whole Grand submit that the power under clause R
6.2.1(ai) does not encompass the power to prohibit an owner from using a
S S
lift altogether. It is said that this sub-clause merely confers power on the
T T
Manager to designate how the three lifts in the Building are to be shared
U
among the various units and floors, on the assumed basis that each floor U
V V
- 28 -
A A
would be served by at least one lift. It does not empower the Manager to
B B
deprive the owners of a particular floor of the use of any lift.
C C
65. In response, counsel on behalf of the IO submit that the power
D D
to allocate and assign lifts for the use of particular floors includes the power
E to allocate the lifts to floors other than a particular floor. Further, they E
submit that the Manager does not in fact prohibit absolutely all use of Lift
F F
A at the 1/F, but allows its use: (1) in case of fire or personal injury; (2) by
G wheelchair-bound disabled persons; (3) by those with mobility problems; G
and (4) in any situation where ordinary people would consider it necessary.
H H
I 66. The wording of the DMC is wide and expressed in general I
terms. It seems to me as a matter of construction that the power to allocate
J J
and assign lifts under sub-clause (ai) includes the power to allocate and
K assign them in such a way that no lift stops at the 1/F. There is in addition K
the general power in clauses 4.4.1 and 6.2.1 even if sub-clause (ai) does not
L L
apply. Removing lift service for a particular floor altogether is a drastic
M measure, but I am satisfied that there is power to do so under the DMC, M
though no doubt it should only be exercised in exceptional circumstances.
N N
Those wielding management power must only do so with caution and even-
O O
handedly, making sure that it is fair to the owners of that floor, even if the
P
owners of the other floors welcome it. There is however no question of the P
measure imposed in this case being ultra vires.
Q Q
67. It is further to be noted that what the IO or the Manager has
R R
imposed, as clarified in the evidence, is not a complete prohibition but
S S
subject to the four exceptions mentioned above. But even with those
T
exceptions, I would accept that the measure is a substantial restriction on T
an owner’s right to use a lift in a building. It is more serious than, for
U U
V V
- 29 -
A A
example, the measure in Music Advance, supra, where the passenger lifts
B B
were closed only for 8 hours a day and the floors affected remained served
C by a cargo lift throughout. C
D D
68. As to the question of reasonableness, it has to be borne in mind
E that, first, building management is a matter primarily for the manager and E
the owners corporation of a building. On many issues there will be a range
F F
of reasonable options open to the management. Within that range it is not
G for the Tribunal itself to manage the building and substitute its own G
decisions on what are reasonable management measures: see Steak Expert
H H
Holdings Ltd v Incorporated Owners of Jade Plaza (Tsuen Wan)
I (HCMP 3233/2015, 21 January 2016), §8. I
J J
69. Secondly, it needs to be recalled that an appeal lies from the
K Tribunal only in point of law. The Tribunal’s assessment of reasonableness K
in this regard, in so far as it lies within the range of tenable opinion, will not
L L
generally raise any issue of law susceptible to appeal.
M M
70. Thirdly, the view reached by the Tribunal in the present case
N N
has to be seen in the context. In particular:
O O
(1) There were real and valid security and nuisance concerns
P P
during 2009 and 2010 before the measure was imposed in
Q response. (Indeed, at the hearing Mr Chan SC clarified that it Q
is not his argument that the Resolution in 2010 was
R unreasonable.) R
S (2) There was no request by Whole Grand to the Owners S
Committee or the Manager to re-open Lift A at the 1/F for
T T
some 8 years until 2018.
U U
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- 30 -
A A
B
(3) In the litigation and indeed in the pre-action solicitors’ letter, B
Whole Grand asserted an absolute right to the use of Lift A.
C The reliefs it claimed were tied to that assertion. It was not C
made clear to the Tribunal that the reasonableness of the
D D
measure imposed was an issue that the Tribunal needed to
E determine in connection with the reliefs claimed: see Judgment, E
§§79-80.
F F
(4) Because Whole Grand considered it had an absolute right, it
G did not engage with the IO at all with a view to addressing the G
concerns of the other owners but took a “wholly
H H
uncompromising and uncaring attitude”.16 It may be that with
I the Escalator having been repaired and kept in good working I
condition, and if Whole Grand and its tenant refrain from
J J
giving the main entrance passcode to visitors, the problem
would not be as serious as before, though this was not how the
K K
case was put below or in the notice of appeal. And it may be
L that with sensible communications in good faith, it can be L
shown that the nuisance and security concerns are unlikely to
M M
arise or can be addressed by less drastic measure than making
N
Lift A skip the 1/F at all times save when the exceptions apply. N
The judge did envisage that attempts could be made to address
O the residents’ concerns, through ways of controlling the O
volume of visitors and preventing them from entering the
P P
residential areas via the 1/F.17 Counsel for Whole Grand has
Q also raised before us the suggestion of a lift access control Q
system, though it is misconceived for them to criticise the
R R
judge for omitting to consider this as an “obvious solution to
S S
T T
16
Judgment, §103.
17
Judgment, §85.
U U
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- 31 -
A A
B
the security concern” when their client had adopted a wholly B
unneighbourly approach.
C C
71. The judge’s opinion on reasonableness was arrived at in the
D D
particular circumstances presented to the Tribunal. As she stated at §90 of
E the Judgment: E
F “ To sum up on the question of the reasonableness of the measure F
taken (assuming it is in issue), I do not consider it unreasonable
for the manager and the respondent not to provide lift service to
G 1/F in light of the circumstances of the present case. The G
circumstances include, inter alia, their valid concerns over
H security and nuisance, the features in the physical layout of the H
Building, the applicant’s attitude and behavior as well as the
lack of means of access for the residential owners to commute
I between the ground floor and their units as compared to the I
better accessibility of 1/F (which justified the giving of priority
J
to the residential owners over 1/F visitors on the use of lifts).” J
K 72. In my judgment this is an opinion the Tribunal was entitled to K
come to on the facts of this case. I do not think that Whole Grand has
L L
demonstrated that there is any error of law in that conclusion.
M M
73. As to the allegation that the judge failed to examine whether a
N N
fair balance has been struck, counsel for Whole Grand refer to the fourth
O stage of the proportionality test as set out in Hysan Development Co Ltd v O
Town Planning Board (2016) 19 HKCFAR 372. I do not see how this
P P
concept applicable in relation to fundamental rights in public law cases has
Q any application in the present case: see Lee Yin Hong v Serenade Cove Q
[2011] 5 HKLRD 660, §11. In any event, the whole thrust of the section of
R R
the Judgment on reasonableness is to set out the judge’s views on balancing
S Whole Grand’s right with the Manager’s powers and the other owners’ S
rights.
T T
U U
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- 32 -
A A
Ground 9
B B
74. Under Ground 9 it is said that the Tribunal erred in failing to
C C
take account of the impact of the BPR and DDO. The Tribunal may be
D correct in saying that it has no jurisdiction to try claims for relief concerning D
disability discrimination or breaches of fire regulations, but in my view this
E E
does not mean that it cannot deal with or take account of allegations that the
F closure of a lift is contrary to the BPR and DDO in determining the true F
legal position as between an owner and the building Management in relation
G G
to the use of a lift.
H H
75. However, the IO has clarified that the restriction imposed does
I I
not apply to persons with mobility problems or in case of fire. Counsel for
J Whole Grand submit that this clarification was only given after the incident J
K
on 28 September 2019 (see §19 above). But even in that unfortunate K
incident, the disabled person was eventually given access to Lift A. I do
L L
not think that there is any material legal error in the Tribunal’s approach
M
that should impugn its overall conclusion. M
N Ground 10 N
O O
76. Finally, counsel submit that the Tribunal’s refusal to grant
P
declaratory relief in favour of Whole Grand was plainly wrong. Referring P
to Convoy Global Holdings Ltd v Kwok Hiu Kwan [2021] HKCA 1594 at
Q Q
§29 (which in turn refers to the three requirements set out by DHCJ To in
R Koo Ming Kown v Rev Mr Mok Kong Ting (HCA 2337/2016, 4 May 2018) R
at §20), they submit that (1) there was a real issue between the parties;
S S
(2) Whole Grand had and still has a genuine interest in obtaining the
T declarations; and (3) the IO was a proper contradictor. T
U U
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- 33 -
A A
77. I do not understand the IO or the Tribunal to have disputed
B B
these three elements in the present case. The difficulty for Whole Grand
C was that it asserted an absolute and unrestricted right to use Lift A and that C
this assertion underpinned the declarations it sought.18 As the judge did not
D D
accept there was any such absolute right, naturally she refused to make the
E declarations. There is nothing raised in the notice of appeal to fault this E
reasoning. There was no narrower declaration (such as one limited to
F F
rejecting the IO’s construction of clause 3.2.1 of the DMC) proposed to the
G G
Tribunal. Even in the notice of appeal the reliefs claimed are the same wide
H
declarations. During his oral submissions in this court, Mr Chan SC H
suggested adding the words “subject to proper exercise of the right of
I I
management under the DMC” to the declarations and injunction sought as
J
referred to in §22(1), (2) and (4) above. But I would decline to disturb the J
order below, in the absence of any legal error demonstrated. In any event,
K K
as Mr Ho SC pointed out on behalf of the IO, it would be pointless to make
L declarations that amount in substance to no more than paraphrasing the L
provisions of the DMC.
M M
N
78. There is no error of law made out under this Ground. N
O Conclusion O
P P
79. For the above reasons, I would hold that none of the grounds
Q
of appeal has been made out. It follows that the appeal must in my view be Q
dismissed. I would make an order nisi that Whole Grand do pay the IO the
R R
costs of the appeal.
S S
T T
18
See Judgment, §104.
U U
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- 34 -
A A
Hon Chow JA:
B B
80. I agree with the judgment of G Lam JA.
C C
D D
E E
F (Susan Kwan) (Godfrey Lam) (Anderson Chow) F
Vice President Justice of Appeal Justice of Appeal
G G
H H
Mr Edward Chan SC & Mr Li Pak Hei, instructed by Messrs. Howell & Co,
for the Applicant (Appellant)
I I
Mr Ambrose Ho SC & Ms Becky Wong, instructed by Messrs. Chung &
J Kwan, for the Respondent (Respondent) J
K K
L L
M M
N N
O O
P P
Q Q
R R
S S
T T
U U
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WHOLE GRAND LTD v. THE INCORPORATED OWNERS OF BO FUNG BUILDING
A A
CACV 77/2023, [2024] HKCA 626
B B
On Appeal From [2021] HKLdT 50
C IN THE HIGH COURT OF THE C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D D
COURT OF APPEAL
E CIVIL APPEAL NO 77 OF 2023 E
(ON APPEAL FROM LDBM NO 57 OF 2019)
F F
____________
BETWEEN
G G
WHOLE GRAND LIMITED Applicant
H (Appellant) H
and
I I
THE INCORPORATED OWNERS Respondent
J J
OF BO FUNG BUILDING (Respondent)
K
____________ K
L Before: Hon Kwan VP, G Lam and Chow JJA in Court L
Date of Hearing: 20 February 2024
M M
Date of Judgment: 9 July 2024
N N
_________________
O JUDGME NT O
_________________
P P
Hon Kwan VP:
Q Q
1. I agree with the judgment of G Lam JA.
R R
S Hon G Lam JA: S
T 2. The appellant (“Whole Grand”) is the owner of, inter alia, T
Shops 4 and 5 on the G/F, the Cockloft, and the whole of the 1/F of Bo Fung
U U
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A A
Building (“Building”) situated at 5 Horse Shoe Lane, Kwun Tong,
B B
Kowloon. The respondent is the Incorporated Owners (“IO”) of the
C Building. This appeal which is brought against a judgment of the Lands C
Tribunal concerns the right of Whole Grand to use a lift at the 1/F.
D D
E Background E
F 3. The Building, erected in 1992, is a commercial-cum- F
residential building. The occupation permit, issued on 26 June 1992,
G G
specified the following uses for the different levels of the Building:
H H
Ground Floor: shops (non-domestic use)
I I
Cockloft: storage (non-domestic use)
J 1st Floor: shop (non-domestic use) J
K 2nd Floor: day nursery & transformer room (non- K
domestic use)
L Podium: roof garden, generator room and L
service rooms (non-domestic use)
M M
3rd to 25th Floors: 4 flats per floor for domestic use (there
are no 4th, 14th and 24th Floors)
N N
O O
4. On 21 July 1992, a deed of mutual covenant (“DMC”) was
P
entered into between (1) the first owners, (2) Cherub Ltd as the “Manager”, P
and (3) The Financial Secretary Incorporated as the assignee of the day
Q Q
nursery on the 2/F. The Building is divided into three portions under the
R DMC, called “Residential Development”, “Commercial Development”, R
and “Day Nursery”.
S S
T
5. There are three lifts in the Building. The one in issue in these T
proceedings is labelled “Lift A” in the building plans and referred to as such
U U
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A A
below. For convenience I shall refer to the other two lifts as “Lift B” and
B B
“Lift C” respectively. To gain access to the three lifts, one has to key in a
C passcode at the entrance of the Building, open the gate and then go through C
a corridor in order to reach the lift lobby.
D D
E 6. From the outset the three lifts had served different floors as E
follows:
F F
G - Lift A served G/F, 1/F, 3/F, 7/F, 9/F, 11/F, 13/F, 16/F, 18/F, G
20/F, 21/F and 25/F
H H
- Lift B served G/F, 3/F, 5/F, 8/F, 10/F, 12/F, 15/F, 17/F,
I 19/F, 21/F and 23/F I
J - Lift C served G/F and the Day Nursery on 2/F J
K 7. In the original configuration of the Building, in order to go to K
the 1/F, one could either (1) go through the main entrance of the Building
L L
at the G/F and take Lift A or walk up the common staircase behind the lift
M shafts; or (2) walk up the steps inside Shop 1 (on the G/F) which lead to the M
Cockloft and then the 1/F.
N N
O 8. Shortly after the Building was completed, certain alteration O
plans affecting Shops 4 and 5, the Cockloft and the 1/F were approved by
P P
the Building Authority on 15 December 1992. The alterations
Q (“Alterations”), which were carried out presumably not long after the plans Q
were approved, involved converting part of Shops 4 and 5 into an entrance
R R
lobby on the G/F that opened to Horse Shoe Lane (“Entrance Lobby”). An
S S
internal one-way escalator (“Escalator”) together with a stairway in
T
parallel (“Stairway”) were installed to connect the Entrance Lobby and the T
Cockloft. The Entrance Lobby, the Cockloft and the 1/F, all of which fall
U U
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A A
within the Commercial Development of the Building, will be referred to as
B B
the “Property”.
C C
9. After the Alterations, one can make use of the Escalator-
D D
Stairway to access the Cockloft from the Entrance Lobby. From the
E Cockloft, one can use the pre-existing staircase (located above Shop 1) to E
access the 1/F.
F F
G 10. By an assignment dated 1 February 2010, Whole Grand G
acquired, inter alia, the Property,1 which was at the time let to a tenant who
H H
operated a restaurant there called “Fu Lin Wah Seafood Restaurant” (“Fu
I Lin Wah”). I
J J
11. In late 2009, the Escalator broke down and could not be
K immediately repaired due to the lack of suitable parts that needed to be K
imported. Fu Lin Wah’s staff disclosed the passcode of the Building’s main
L L
entrance to their customers so that they could take Lift A to access Fu Lin
M Wah on the 1/F. The frequent use of Lift A by Fu Lin Wah’s customers M
resulted in complaints from the residents of the Building.
N N
O 12. At a meeting on 16 July 2010, the Owners’ Committee of the O
Building (there being no incorporated owners then) passed a resolution
P P
(“Resolution”) that the customers of Fu Lin Wah shall not be allowed to
Q use the lifts of the Building and that lawyers would be instructed to Q
implement the arrangement in accordance with the provisions of the
R R
DMC. Whole Grand’s representative attended the meeting but did not raise
S any objection. Accordingly, in around October 2010, Lift A was adjusted S
T T
1
The assignment covered Shops 1, 2, 3, 4, 5, 6 and 7, the Cockcroft, the whole of the 1/F, and Flat A
on the 3/F.
U U
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-5-
A A
so that it would no longer stop at the 1/F. A notice published by the
B B
Manager on 19 October 2010 stated that if access to Lift A at the 1/F was
C needed in an emergency, the management staff could be approached for that C
purpose.
D D
E 13. Fu Lin Wah did not make any complaint to Whole Grand about E
the closure of Lift A on the 1/F, and vacated the Property after its tenancy
F F
expired on 30 November 2011.
G G
14. From 10 December 2011 to 9 December 2017, the Property
H H
was let by Whole Grand to another tenant, Jointed-Heart Ltd (“Jointed-
I Heart”), who operated a rice noodle restaurant there. It is not clear exactly I
when the Escalator was eventually repaired, but the evidence, which was
J J
apparently uncontroversial, was that by the time Jointed-Heart took
K possession of the Property, the Escalator was operating normally and had K
never since broken down due to disrepair. Jointed-Heart did not make any
L L
request for Lift A to resume serving the 1/F, and Whole Grand therefore
M likewise did not take any action about the cessation of service of Lift A for M
the 1/F.
N N
O 15. After Jointed-Heart vacated the Property in December 2017, O
Whole Grand began looking for suitable tenants and in the course of doing
P P
so, received offers from prospective tenants who required lift service
Q between the G/F and the 1/F as a condition for taking up a tenancy of the Q
Property. Whole Grand therefore requested the Manager to reactivate the
R R
service of Lift A for the 1/F. The response to these requests was apparently
S S
delayed because an owners’ corporation for the Building was being set up
T
at the time. The IO was eventually incorporated on 22 August 2018. Whole T
Grand thereafter requested the IO for Lift A to resume serving the 1/F. The
U U
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A A
IO responded by asking Whole Grand to obtain formal legal advice to show
B B
that it had the right to use the Lift A.
C C
16. On 4 January 2019, Howell & Co, solicitors instructed by
D D
Whole Grand, wrote to the IO stating that Whole Grand was entitled under
E the DMC to use Lift A for the proper enjoyment of the Property and that E
the IO had failed to discharge its duties under the DMC and the Building
F F
Management Ordinance (Cap 344) (“BMO”), deprived persons with
G disability of the use of a lift contrary to section 72 of the Building (Planning) G
Regulations (Cap 123F) (“BPR”) and section 28(2) of the Disability
H H
Discrimination Ordinance (Cap 487) (“DDO”), and created a fire hazard by
I depriving the Property of the use of a firemen’s lift. The solicitors I
demanded that the IO forthwith allow access by Whole Grand, its tenants,
J J
servants, agents and licensees to Lift A and admit liability for breaches of
K K
duties and agree to compensate Whole Grand for its losses.
L L
17. The IO at a meeting on 17 January 2019 resolved to seek free
M legal advice from the Home Affairs Department and other sources before M
coming to a decision.
N N
O 18. On 15 March 2019, Whole Grand instituted proceedings O
against the IO in the Lands Tribunal (“Tribunal”).
P P
Q 19. Since 2 July 2019, the Property had been leased to a new tenant Q
on a 4-year lease for another restaurant business, called “窩心八鮮蒸鍋”.
R R
On 28 September 2019, there was an incident at the restaurant. A disabled
S S
customer in a wheelchair was carried by others to the restaurant on the 1/F
T
but, when he left, for safety reasons he could not be similarly carried down T
to the G/F and had to take the lift instead. The person-in-charge at the
U U
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A A
restaurant made a request to the Manager who initially refused the request
B B
on the ground that the IO had decided not to allow the Lift A to serve the
C 1/F. The request was eventually acceded to after a more senior person in C
the Manager intervened.
D D
E 20. On 18 October 2019, the Manager issued a notice stating that E
the IO had since the incident of 28 September 2019 instructed that if there
F F
is a fire or injury or if there is a need from disabled and wheelchair-bound
G persons, it will be treated as an emergency and the caretaker will make G
Lift A accessible to the 1/F for use by the relevant persons.
H H
I The parties’ cases I
J 21. Whole Grand’s case in the Tribunal as set out in its Amended J
Notice of Application was as follows.
K K
L (1) Lift A is within the definition of “Common Areas” of the L
Building in the DMC and within the definition of “common
M M
parts” in the BMO. It forms part of the Commercial
N
Development and also part of the Residential Development in N
the Building. Under the DMC, the owners for the time being
O of any Commercial Units, their tenants, servants, agents, O
lawful occupants and licensees have the right to use and enjoy
P P
the lift service provided by Lift A for going between the 1/F
Q and the G/F. Q
(2) The rights and authorities of the Manager are subject to the
R R
provisions of the DMC including its duty to prevent
S obstruction of the Common Areas. S
T (3) The closure of Lift A is wrongful and contrary to the T
provisions of the DMC. By closing Lift A to the 1/F in August
U U
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-8-
A A
B
2010, the Owners’ Committee and the Manager acted in B
breach of:
C C
(a) various provisions of the DMC;
D D
(b) section 2 of the BMO, in that Lift A is within the
E “common parts” of the Building; E
(c) section 72 of the BPR and section 78 of the 3rd Schedule
F F
to the BPR, in denying access to a lift for the disabled;
G G
(d) section 28(2) of the DDO, in discriminating against
H persons with a disability; H
(4) The liabilities arising from the closure of Lift A were
I I
transferred to and to be borne by the IO upon its incorporation.
J J
(5) The IO breached its duties under section 18 of the BMO by
K adopting the closure of Lift A. K
L
(6) Whole Grand had received offers from prospective tenants to L
rent the Property at a monthly rent of $255,000 or $250,000
M subject to the availability of access to Lift A. As a result of M
the IO’s breaches, Whole Grand lost those prospective
N N
tenancies. It claims damages for lost rental income between
O April and August 2018 in the sum of $1.04 million and also O
for reduced rental income over the term of the current tenancy
P P
in the sum of approximately $1.03 million.
Q Q
22. By way of relief, Whole Grand claimed:
R R
(1) a declaration that Whole Grand as owner of the Property, its
S tenants, servants, agents, lawful occupants and licensees shall S
have the right to use and enjoy Lift A as part of the Common
T T
U U
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A A
B
Areas under the DMC and/or as a common part under the B
BMO;
C C
(2) a declaration that the IO has no power under the DMC or
D otherwise to deny Whole Grand, its tenants, servants, agents, D
lawful occupants and licensees the access to and use and
E E
enjoyment of Lift A as part of the Common Areas and/or
F
common parts; F
(3) a declaration that the IO has no power under the DMC or
G G
otherwise to close access on the 1/F to Lift A as a lift for the
H disabled and a firemen’s lift; H
I
(4) an order that the IO do forthwith reinstate the lift service I
between the G/F and the 1/F by re-opening access to Lift A on
J the 1/F for the use and enjoyment of Whole Grand as owner of J
the Property, its tenants, servants, agents, licensees and lawful
K K
occupants of the Property; and
L L
(5) damages, including loss of rental income.
M M
23. The IO’s case in the Tribunal as set out in its Re-Amended
N Notice of Opposition was as follows: N
O O
(1) It is admitted that Lift A is part of the “Common Areas” of the
P
Building under the DMC. But by virtue of clause 3.2.1 of the P
DMC, an owner of a Commercial Unit is not entitled to use
Q Lift A because it forms part of the Residential Development. Q
R (2) Since late 2009, the then owner or tenant of the Property had R
failed to maintain the Escalator, causing many of its customers
S S
to take Lift A for access between the G/F and the restaurant.
T
As a result, nuisance, annoyance and/or disturbance was T
caused to the owners and residents of the Building.
U U
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A A
B
(3) Pursuant to the powers under the DMC, the Owners’ B
Committee made the House Rules or passed the Resolution
C that the owners of the Commercial Development shall not C
enter the Building except the Commercial Development and
D D
Lift A shall not stop at the 1/F except in emergency. In so
E doing, the Owners’ Committee set aside, allocated and/or E
assigned Lift A for the exclusive use of the G/F, Podium, 5/F,
F F
7/F, 9/F, 11/F, 13/F, 16/F, 18/F, 20/F, 22/F and 25/F.
G (4) Alternatively, the Manager has power under the DMC to set G
aside, allocate and/or assign Lift A to those floors.
H H
(5) The House Rules or Resolution were made taking into account
I I
a number of matters including security concerns. They were
reasonable and proper measures made by the Owners
J J
Committee and implemented by the Manager and binding on
K all the owners of the Building. K
L (6) After its incorporation, the IO adopted, confirmed and/or L
continued to implement the House Rules or Resolution.
M M
The Tribunal’s judgment
N N
24. The case was tried before Deputy District Judge Michelle
O O
Soong sitting as the Presiding Officer of the Tribunal (“judge”). On
P 30 July 2021, the Tribunal issued its judgment (“Judgment”).2 P
Q Q
25. The judge dealt first with the IO’s contention that Whole
R Grand, as the owner of a Commercial Unit, was excluded from Lift A being R
S S
T T
2
[2021] HKLdT 50.
U U
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A A
part of the Residential Development. The IO’s argument was based on
B B
section 3 of the DMC. Clause 3.2 provides as follows:
C C
“ 3.2 Commercial Units
D 3.2.1 The Owner of a Commercial Unit shall have the D
benefit of the following easements, rights and privileges
E subject to the provisions and restrictions contained in this E
Deed, the House Rules and subject to the rights of the
Manager as hereinafter provided and to the payment by the
F Owner of his due proportion of the Manager’s F
Remuneration and management expenditure:-
G (a) Full right and liberty (but subject always to G
the right of the Manager and the Assignor
H hereunder) for the Owner for the time being, H
his tenants, servants, agents, lawful
occupants and Licensees (in common with all
I persons having the like right) to go pass or I
repass, over and along and to use such of the
Common Areas forming part of the
J J
Commercial Development and not those
forming part of the Residential Development
K for all purposes connected with the proper K
use and enjoyment of such Commercial Unit.
L … L
3.2.2 The Owners of the Commercial Units shall have no
M right to enter upon any part of the Land and the Building M
save as expressly herein provided, …” (underlining added)
N N
26. “Residential Development” is defined in clause 1.1 of the
O O
DMC to mean “the Units on the Floors above the Second Floor Level of the
P Building and/or any other parts of the Land and the Building intended for P
residential use.”
Q Q
R
27. The IO submitted that Lift A was intended for residential use R
and because it formed part of the Residential Development, Whole Grand
S S
as the owner of a Commercial Unit was excluded from it by virtue of
T clause 3.2.1. The judge rejected this argument and held that Lift A T
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A A
(including the lift lobby) was intended for common use by the residential
B B
3
and commercial units including the 1/F.
C C
28. The judge went on to note that the Alterations had taken place
D D
which had obviously enhanced the conspicuousness and accessibility of the
E 1/F, but that there was no information on whether they were done with the E
consent of the Manager and the other owners of the Building and, if so, on
F F
what basis consent was given.4 At §59, the judge stated:
G G
“ In my view, even if the DMC originally intended, upon its
drafting and execution, that Lift A should serve 1/F, that
H H
intention was obviously based on the original design of the
Building with a correspondingly smaller number of visitors to
I 1/F which could be reasonably absorbed by the capacity of the I
lift lobby and the lift without causing much problems to the
residential owners. But since the Alterations have virtually
J J
changed what I would describe metaphorically as ‘the
ecology’ of the Building by substantially increasing the
K conspicuousness and accessibility to 1/F and the potential K
number of visitors thereto, in my view it is no longer meaningful
for the parties to place their entire focus on whether the
L applicant’s use of the lift was permitted or not permitted under L
the DMC.”
M M
29. The judge also noted that after the Alterations, outsiders
N N
including customers could easily gain access to the 1/F through the
O Entrance Lobby and then to Lift A or the common staircase and in turn to O
any floor of the Residential Development. The Alterations had opened up
P P
a major loophole in the security system of the Building, with or without lift
Q service to the 1/F. With the availability of a lift, the difference is just a Q
matter of degree.5
R R
S S
3
Judgment, §§49-52.
T T
4
Judgment, §§54-58.
5
Judgment, §§60-62.
U U
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A A
30. The judge went on to observe that there might have been a
B B
breach of clause 5.1.4 of the DMC which prohibited structural alterations
C that interfered with or affected the rights of other owners, since the C
Alterations compromised the security system and overloaded the capacity
D D
6
of Lift A and the lift lobby.
E E
31. Further, the judge noted that the Escalator fell into disrepair in
F F
late 2009 and the 1/F restaurant then gave the passcode for the main
G entrance of the Building to the customers, resulting in overcrowding of the G
lift lobby, competition and conflicts from the use of Lift A as well as
H H
security concerns, and arguably a breach of clause 5.1.9 of the DMC, which
I provides: I
J J
“ No Owner shall do or permit or suffer to be done and each
Owner shall take all possible steps to prevent his tenants
K occupiers or licensees from doing any act deed matter or thing K
which in any way interferes with or affects or which is likely to
interfere with or affect the proper management and maintenance
L of the Building.”7 L
M M
32. The judge noted that under the express terms of clause 3.2.1 of
N
the DMC, the right of the owner of a Commercial Unit to use the Common N
Areas is “subject to the provisions and restrictions contained in this Deed,
O O
the House Rules and subject to the rights of the Manager as hereinafter
P provided.” Clause 6.2.1 confers a wide power on the Manager to manage P
the Building, as follows:
Q Q
“ The Manager will manage the Land and the Building in a proper
R manner and in accordance with this Deed and except as R
otherwise herein expressly provided the Manager shall be
responsible for and shall have full and unrestricted authority to
S do all such acts and things as may in its opinion be necessary or S
T T
6
Judgment, §§63-65.
7
Judgment, §§66-69.
U U
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A A
requisite for the proper management of the Land and the
B Building. Without in any way limiting the generality of the B
foregoing the Manager shall have the following duties and
powers namely:-
C C
…
D D
(i) To prevent the obstruction of all the Common Areas and
to remove any article or thing causing obstruction …
E E
(o) To do all things which the Manager shall in his absolute
discretion deem necessary or desirable for the purposes of
F maintaining renewing and improving all facilities and F
services in or on the Building for the better enjoyment or
use of the Building by its Owner occupiers and their
G G
licensees.
…
H H
(ai) To allocate and/or assign any lift for the exclusive use of
I particular floors and/or Units where the circumstances so I
warrant.”
J J
33. The judge stated that even if Whole Grand’s right to use Lift
K A is wholly unaffected by the Alterations, its right is not an absolute and K
unqualified one. It cannot assert an absolute right to use Lift A without
L L
regard to the potential breach of the DMC (i.e. clauses 5.1.4 and 5.1.9) on
M its part, the inconvenience and interference caused to other owners, and the M
Manager’s obligation and power to manage to Building properly and
N N
8
protect the interests of other owners.
O O
34. The judge noted that the exercise of rights in the multi-unit
P P
building context must be subject to an element of reasonableness, and that
Q it appeared that Whole Grand was not challenging the reasonableness of the Q
closure of Lift A as a measure to tackle the security and overcrowding
R R
concerns. Assuming such reasonableness was in issue, the judge said she
S did not think the measure taken was unreasonable. She found the IO’s S
T T
8
Judgment, §§70-75.
U U
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A A
security and nuisance concerns to be real and valid. It was incumbent on
B B
Whole Grand to take a more proactive approach to deal with the problems
C caused by the Alterations, instead of treating compliance with the DMC as C
merely the tenant’s own responsibility. Whole Grand had simply asserted
D D
a full and unrestricted right to use Lift A, without showing any willingness
E to accommodate any reasonable measures proposed by the IO. In E
conclusion the judge did not consider it unreasonable for the Manager and
F F
9
the IO not to provide lift service to 1/F in light of all the circumstances.
G G
35. In the end, although the judge agreed with Whole Grand on the
H H
construction of clause 3.2.1 of the DMC, she declined to make any
I declaration since Whole Grand was asserting an absolute and unrestricted I
right. She stated that should Whole Grand wish to have the lift service
J J
reinstated, they should interact with the IO reasonably with a view to
K K
addressing the valid concerns of other owners before prematurely seeking
L
redress from the court. As the judge did not find any breach of the DMC L
by the IO, no damages were awarded. Accordingly, the judge dismissed
M M
Whole Grand’s application with costs.10
N N
Whole Grand’s appeal
O O
36. Under sections 11(2) and 11AA of the Lands Tribunal
P P
Ordinance (Cap 17), an appeal lies from a judgment of the Tribunal to the
Q
Court of Appeal on an error in point of law, with leave of the Tribunal or Q
the Court of Appeal. In a decision dated 6 January 2023, the judge refused
R R
S S
T T
9
Judgment's, §§76-90.
10
Judgment, §§102-105.
U U
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A A
to grant Whole Grand leave to appeal.11 On 3 March 2023, Chow JA grant
B B
leave to appeal.
C C
37. The grounds advanced by Whole Grand for the appeal may be
D D
stated broadly as follows:
E E
(1) The Tribunal traversed beyond the pleadings and went into the
F F
unpleaded Alterations in reaching its decision.
G (2) The true issue was the binary question of whether or not Whole G
Grand as an owner of Commercial Units has the right to use
H H
Lift A. If Lift A is a common area or common part, Whole
I Grand has a right to use it and the IO has no power to remove I
that right. This question is to be determined as at the execution
J J
of the DMC. Post-agreement conduct and statements are
irrelevant. Once the Tribunal concluded that when the DMC
K K
was executed on 21 July 1992 it was intended that Lift A
L should serve 1/F, that should have been the end of the analysis L
and should have resulted in the determination of dispute in
M M
Whole Grand’s favour.
N N
(3) The Tribunal erred in holding that the analysis does not end
with the construction of the DMC, and in holding that the
O O
“ecology” of the Building was changed by the Alterations.
P Whole Grand has the right to remove the Alterations at any P
time. The Alterations could not result in a different
Q Q
interpretation being given to the right of Whole Grand to use
R Lift A under the DMC. R
(4) The Tribunal was wrong to consider the Alterations an adverse
S S
factor against Whole Grand. The Alterations were at most a
T T
11
[2023] HKLdT 2.
U U
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A A
B
neutral factor because, among other things, the 1/F had always B
been intended to be for commercial use; the Alterations were
C lawfully carried out pursuant to approved Alterations and C
Additions Building Plans; the way the 1/F was used as a
D D
restaurant did not involve any breach of the DMC; and the
E Alterations provided an alternative entrance to the 1/F, helping E
to reduce reliance on the common parts of the Building, and
F F
did not amount to an abandonment by the Property’s owner of
its right to use Lift A.
G G
(5) The IO did not counterclaim for any breach of the DMC by
H H
Whole Grand. The Tribunal was not asked to adjudicate and
I did not make any finding on any breach of the DMC by Whole I
Grand. In any event, Whole Grand’s right to use Lift A was
J J
not dependent on the absence of breach of the DMC.
K (6) The Tribunal erroneously shifted the burden to Whole Grand K
in saying that it was incumbent on it to deal proactively with
L L
the problems caused by the Alterations. It was for the IO to
M justify its conduct in depriving Whole Grand of the right to use M
Lift A.
N N
(7) The Tribunal was wrong to find that the measure taken by the
O IO was reasonable. The IO did not merely impose restrictions, O
but deprived Whole Grand of the right to use lift service
P P
completely.
Q Q
(8) The Tribunal failed to examine the overall impact of the
measure imposed and determine whether a fair balance have
R R
been struck between the collective interest and the individual
S rights encroached upon. S
T (9) The Tribunal erred in failing to take account of the impact of T
the BPR and DDO.
U U
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- 18 -
A A
B
(10) The Tribunal’s refusal to grant declaratory relief was plainly B
wrong. There existed a real issue between the parties, and
C Whole Grand had and still has a genuine interest in obtaining C
a declaration against the IO.
D D
38. The IO has filed a respondent’s notice contending that the
E E
three declarations sought by Whole Grand (see §22(1)-(3) above) were
F F
correctly refused because there was no total denial of Whole Grand’s right
G
to use Lift A and the chairman of the IO had stated in his witness statement G
that Lift A could be used for the 1/F: (1) in case of fire or personal injury;
H H
(2) by wheelchair-bound disabled persons; (3) by those with mobility
I problems; and (4) in any situation where ordinary people would consider it I
necessary.
J J
K
39. I shall deal in turn below with the contentions advanced. K
L Ground 1 – the pleading objection L
M M
40. Counsel for Whole Grand submit that the judge was wrong to
N
traverse into the Alterations which were wholly unpleaded, even though N
there may have been evidence on the subject. It is the pleadings that define
O O
the issues for determination by the Tribunal and not the other way round.
P P
41. I do not accept this argument. While the IO’s Notice of
Q Q
Opposition did not refer to the Alterations as such, it referred to the
R
Escalator and the Stairway extensively which were created by the R
Alterations – see §§9(a), (f)(i), (ii) and (vi). It was stated that as a result of
S S
the failure to maintain the Escalator, large numbers of the customers of the
T restaurant used Lift A for access, causing security and overcrowding T
U U
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A A
concerns for the residents of the Building. For its part, Whole Grand
B B
responded to those matters in its Reply.
C C
42. The notices of application and opposition are not pleadings as
D D
such. Section 10(5)(a) of the Lands Tribunal Ordinance provides that “the
E proceedings of the Tribunal shall be conducted with as much informality as E
is consistent with attaining justice”. Direction No 4 given by the President
F F
of the Lands Tribunal on 1 July 1986 states that presiding officers should
G not regard Notices as in the nature of pleadings by which parties are bound, G
but as an indication of the issues which are likely to be raised. Nevertheless,
H H
basic fairness requires that there should be advance notice of the points
I taken and issues raised and that no party should be prejudiced by being I
taken by surprise and having to deal with issues raised without a proper
J J
opportunity of preparing for them: see Grand Power v Chan Sing Hoi [2020]
K K
2 HKLRD 142, §§27-42; Great Source Enterprise Ltd v Sino Estates
L
Management Ltd (CACV 253/2003, 7 May 2004), §§14-17. The L
application of this principle – and the rigour with which ordinary rules of
M M
pleading may be applied by analogy – will of course depend on the facts
N
and the procedures adopted in the particular case. N
O O
43. In the present case, what the judge did was to take account of
P
the state of the Property and the Building as they existed at the time of the P
litigation (i.e. after the Alterations) – which she described as the “ecology”
Q Q
of the Building – in considering how the rights of Whole Grand and the
R other owners are to be balanced and what powers of management the R
Manager and the IO have and how they are to be exercised. In so doing she
S S
did not in my view traverse into unpleaded matters.
T T
U U
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- 20 -
A A
44. It was revealed in the course of trial, in particular during the
B B
cross-examination of the IO’s witness, that the existing configuration of the
C Property was not the original design of the Building but the result of C
substantial alterations done subsequent to its completion. In so far as the
D D
judge raised the unpleaded question whether consent for the Alterations was
E given by the Manager and/or the other owners on the understanding that E
henceforth the occupants and visitors of the Property should use the
F F
12
Escalator and the Stairway as their primary means of access, she noted
G G
that there was no evidence at all in that regard, and did not pursue this
H
further in her reasoning. H
I Grounds 2 and 3 I
J 45. Counsel for Whole Grand submit that the judge was wrong in J
K
holding that the Alterations changed the “ecology” of the Building and that K
it was “no longer meaningful” for the parties to focus on whether the use of
L L
Lift A was or was not permitted under the DMC. Instead, counsel submit,
M
the issue is a binary question of the construction of the DMC and BMO as M
to whether or not Lift A is a common area and common part. Post-
N N
agreement conduct is irrelevant to the construction of the DMC. Shops 4
O and 5 can be sold separately from the rest of the Property and the Alterations O
reversed, as Whole Grand wishes. The judge’s analysis would suggest that
P P
the right of the Property’s owner to use Lift A was lost upon carrying out
Q the Alterations in 1992. This cannot be right. Q
R R
46. I do not agree that the finding that Lift A is a common area or
S common part is the end of the analysis as Whole Grand contends. It is true S
that the IO had taken the position that Lift A was part of the Residential
T T
12
See Judgment, §58.
U U
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- 21 -
A A
Development and, as such, categorically excluded by virtue of clauses
B B
3.2.1(a) and 3.2.2 of the DMC from the common areas to which a
C commercial unit owner had any right of access. That interpretation is wrong, C
as the judge held. A declaration to that effect might have been made if that
D D
was what Whole Grand had claimed.
E E
47. But that was not what Whole Grand claimed. The orders it
F F
sought (see §22 above) assert a categorical and absolute right to the use of
G Lift A. Its case run before the Tribunal was squarely based on such absolute G
right: see §§79, 89 and 104 of the Judgment; see also §13, 14, 15 and 17 of
H H
the judge’s decision refusing leave to appeal. At §14 of the latter, the judge
I recorded: I
J J
“ … at trial I specifically asked the applicant’s Counsel to confirm
whether the applicant was still seeking an absolute and
K unrestricted right to use the lift by that time. Mr Ho answered K
in the affirmative during his closing submissions. …”
L L
48. The judge did not accept that Whole Grand had any such
M absolute right free from any power of restriction. DMCs are subscribed to M
by owners in multi-unit buildings for the purposes of “regulating by
N N
contract their rights inter se regarding the exclusive use and occupation of
O the units allotted to their respective parcels of undivided shares, their use of O
the common parts of the building, as well as their mutual obligations on
P P
such matters as management charges”: Kung Ming Tak Tong Co Ltd v Park
Q Solid Enterprises Ltd (2008) 11 HKCFAR 403, §19. As a matter of general Q
principle, the rights to the use and enjoyment of common areas and facilities
R R
“are not absolute and must as a matter of construction be subject to an
S S
element of reasonableness and also must coexist with other provisions in
T
the DMC unless specifically excluded”: Music Advance Ltd v Incorporated T
Owners of Argyle Centre Phase I [2010] 2 HKLRD 1041, §14; approved
U U
V V
- 22 -
A A
by this court in Silver Triumph Ltd v Guardian Ltd (HCMP 566/2012,
B B
18 May 2012), §17.
C C
49. Further, the DMC in respect of the Building contains express
D D
words in clause 3.2.1 making the right of a commercial unit’s owner to use
E the Common Areas subject to the provisions and restrictions contained in E
the DMC, the House Rules, and the rights of the Manager provided in the
F F
DMC. Clause 4.4.1 confers on the Manager “full right and authority to
G control and manage the Common Areas and Common Facilities”. Clause G
6.2.1 gives the Manager “full and unrestricted authority to do all such acts
H H
and things as may in its opinion be necessary or requisite for the proper
I management of the Land and the Building.” Such power must of course be I
exercised in good faith, reasonably, and not for improper purposes.
J J
K 50. From the outset, therefore, Whole Grand’s predecessor-in-title K
did not have an absolute and unqualified right to use the common areas by
L L
itself, its tenant or its licensees in whatever way they thought fit and without
M regard to the effect on the other owners. There is no question of it having M
“lost” such right through carrying out the Alterations. Nor did the Tribunal
N N
rely on the Alterations, which was admittedly something that occurred after
O O
the DMC, for the purpose of construing it.
P P
51. It is plain that the reasonableness of the restrictions imposed
Q has to be judged with reference to the prevailing circumstances. There is in Q
my view nothing erroneous for the Tribunal to have regard to the
R R
Alterations and other subsequent events in assessing what courses of action
S S
were properly open to the Manager and the IO under the DMC in terms of
T
restriction on access to Lift A at the 1/F. Should Whole Grand sell Shops T
4 and 5 separately with the result that the Escalator and Stairway are
U U
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- 23 -
A A
removed, no doubt that would be a material circumstance for the Manager
B B
and the IO to take into account in the exercise of their powers, and for the
C Tribunal to consider if there is a dispute. C
D D
Ground 4
E E
52. Counsel for Whole Grand submit that the Alterations are at
F most a neutral factor. They are internal to the Property and do not disturb F
the common parts. They have been in place since 1992, 18 years before
G G
Lift A was closed to the 1/F. If anything, they provide an alternative and
H additional access route to the 1/F through the Entrance Lobby, and reduce H
the need for occupants and visitors to rely on the common parts for access
I I
to the 1/F. The Alterations fall far short of any clear and unequivocal
J abandonment of the right to use Lift A. J
K K
53. I do not see that any error of law in the Judgment has been
L shown in connection with this ground. No one has suggested that the L
Alterations gave rise to an abandonment of right on the part of Whole Grand
M M
or its predecessor-in-title. The fact that the Alterations were internal to the
N N
Property and done in accordance with approved building plans and the fact
O
that the 1/F has from the beginning been intended for non-domestic use do O
not mean that there cannot be nuisance or security concerns caused to other
P P
owners. It is speculative to suggest that the Alterations have reduced the
Q
number of visitors using the common parts, since, without the Alterations, Q
there might have been far fewer visitors to the 1/F in the first place. The
R R
fact based on unchallenged evidence is that the Escalator broke down for a
S substantial period of time between 2009 and 2010 and Fu Lin Wah’s staff S
gave the passcode of the main gate of the Building to its customers, leading
T T
U U
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- 24 -
A A
to overcrowding and security concerns, which the Tribunal found to be “real
B B
and valid”. 13
There is no appeal from this finding.
C C
54. It is true that Lift A did serve the 1/F for many years before
D D
2009. This suggests that even with a restaurant operating at the 1/F, there
E may be scope for relaxing the restriction if a reasonable and acceptable E
solution can be found. This is why the judge was singularly unimpressed
F F
by the extreme but misconceived stance of Whole Grand that it has an
G absolute right incapable of being restricted and also by the “none of my G
business” attitude of Whole Grand’s representative towards its tenant’s
H H
compliance with the DMC.14
I I
55. I do not see any error of law in the Tribunal taking into account
J J
the Alterations and what had happened as shown in the evidence.
K K
Ground 5
L L
56. This ground criticises §75 of the Judgment where the judge
M M
stated: “The applicant could not assert the use of lift as an absolute right
N without any regard [to] the potential breach of the DMC provisions [i.e. N
clauses 5.1.4 and 5.1.9] on their part …” Counsel for Whole Grand submit
O O
that there was no counterclaim by the IO or finding by the Tribunal that
P Whole Grand had breached the DMC. Even if there was a breach, the DMC P
does not provide as a condition precedent that Whole Grand must first
Q Q
comply with its duties in order to be entitled to use Lift A.
R R
S S
T T
13
Judgment, §81.
14
See Judgment, §§85-90.
U U
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- 25 -
A A
57. In my view the criticism is misplaced. The judge was careful
B B
not actually to find any breach of clauses 5.1.4 and 5.1.9 of the DMC by
C Whole Grand, there being no counterclaim or allegation by the IO to that C
effect. It is correct that there is no provision in the DMC that compliance
D D
by an owner with his obligations is a condition precedent to the enjoyment
E of his rights thereunder. But with respect the argument misses the point, E
which is that, as explained above, the right in question is not absolute but
F F
subject to an element of reasonableness, to the other provisions of the DMC,
G G
and to the powers of managements conferred on the Manager and the IO.
H
The fact that Whole Grand or its tenant has engaged in conduct that may H
interfere with the enjoyment by the other owners of their rights is plainly a
I I
matter that the judge was entitled to take into account.
J J
Ground 6
K K
58. By Ground 6 it is contended that the judge wrongly shifted the
L L
burden by holding (in §85 of the Judgment) that it was incumbent on Whole
M
Grand to take a more proactive approach to deal with the problems caused M
by the Alterations.
N N
O
59. I do not think any error of law is made out. First, reading the O
sentence attacked in the context of §§84-86 of the Judgment, it is clear that
P P
what the judge found unsatisfactory is that Whole Grand was simply
Q
interested in letting out its Property and paid no regard whatsoever to the Q
use of the common parts of the Building by the tenant and its visitors. What
R R
the judge meant was that compliance with the DMC, such as in terms of not
S causing nuisance to the other owners, is a matter for Whole Grand as the S
owner, who cannot absolve itself simply by leaving everything to the tenant.
T T
This observation cannot be faulted. Plainly an owner is responsible under
U U
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- 26 -
A A
the DMC if his tenant interferes with the enjoyment by the other owners of
B B
their property. For example, clause 5.1.9 provides that “each Owner shall
C take all possible steps to prevent his tenants occupiers or licensees from C
doing any act deed matter or thing which in any way interferes with or
D D
affects or which is likely to interfere with or affect the proper management
E and maintenance of the Building.” E
F F
60. Secondly, the relevant sentence in the Judgment does not
G concern the burden of proof in the litigation. What the judge criticised and G
rejected in the wider context of §§84-90 is Whole Grand’s uncompromising
H H
position that it had an absolute and untrammelled right. This is relevant to
I the judge’s overall consideration of the reasonableness of the restriction I
imposed.
J J
K 61. Thirdly, in any event, even on the question of burden of proof K
itself, I do not think it entirely accurate for counsel to submit that the burden
L L
lies on the IO to justify its conduct. Whole Grand brought the proceedings
M for declarations and an injunction, claiming an absolute right. In response, M
the IO took the position that Whole Grand had no right at all to use Lift A
N N
but that in any event the right, if any, was subject to the powers of the
O O
Manager or the Owners Committee or the IO under the DMC. It was
P
averred that the Resolution in 2010 was made pursuant to those powers. In P
reply, Whole Grand averred that the Resolution was “unreasonable,
Q Q
wrongful, unlawful and in breach of the DMC”.15 The general principle of
R law is that he who asserts must prove: see e.g. Wong Hon Sun v HKSAR R
(2009) 12 HKCFAR 877, §23.
S S
T T
15
Amended Reply, §§8 & 9.
U U
V V
- 27 -
A A
Grounds 7 and 8
B B
62. Whole Grand contends that the judge erred in holding that the
C C
measure adopted by the IO was not unreasonable because the IO did not
D merely impose restrictions, but deprived Whole Grand of the right to use D
lift service completely. It is submitted that there is no power under the
E E
DMC for the IO or the Manager to deprive Whole Grand of the right to use
F Lift A. It is further submitted that the judge failed to examine the overall F
impact of the measure imposed and to decide whether a fair balance has
G G
been struck between the general interest and the individual rights in
H H
question.
I I
63. As mentioned above, clause 4.4.1 of the DMC gives the
J Manager “full right and authority to control and manage the Common Areas J
K
and Common Facilities”, and clause 6.2.1 gives it “full and unrestricted K
authority to do all such acts and things as may in its opinion be necessary
L L
or requisite for the proper management of the Land and the Building”.
M
Clause 6.2.1 goes on to provide: M
N “ Without in any way limiting the generality of the foregoing the N
Manager shall have the following duties and powers namely: –
O … O
(ai) To allocate and/or assign any lift for the exclusive use of
P particular floors and/or Units where the circumstances so P
warrant.
Q …” Q
R 64. Counsel for Whole Grand submit that the power under clause R
6.2.1(ai) does not encompass the power to prohibit an owner from using a
S S
lift altogether. It is said that this sub-clause merely confers power on the
T T
Manager to designate how the three lifts in the Building are to be shared
U
among the various units and floors, on the assumed basis that each floor U
V V
- 28 -
A A
would be served by at least one lift. It does not empower the Manager to
B B
deprive the owners of a particular floor of the use of any lift.
C C
65. In response, counsel on behalf of the IO submit that the power
D D
to allocate and assign lifts for the use of particular floors includes the power
E to allocate the lifts to floors other than a particular floor. Further, they E
submit that the Manager does not in fact prohibit absolutely all use of Lift
F F
A at the 1/F, but allows its use: (1) in case of fire or personal injury; (2) by
G wheelchair-bound disabled persons; (3) by those with mobility problems; G
and (4) in any situation where ordinary people would consider it necessary.
H H
I 66. The wording of the DMC is wide and expressed in general I
terms. It seems to me as a matter of construction that the power to allocate
J J
and assign lifts under sub-clause (ai) includes the power to allocate and
K assign them in such a way that no lift stops at the 1/F. There is in addition K
the general power in clauses 4.4.1 and 6.2.1 even if sub-clause (ai) does not
L L
apply. Removing lift service for a particular floor altogether is a drastic
M measure, but I am satisfied that there is power to do so under the DMC, M
though no doubt it should only be exercised in exceptional circumstances.
N N
Those wielding management power must only do so with caution and even-
O O
handedly, making sure that it is fair to the owners of that floor, even if the
P
owners of the other floors welcome it. There is however no question of the P
measure imposed in this case being ultra vires.
Q Q
67. It is further to be noted that what the IO or the Manager has
R R
imposed, as clarified in the evidence, is not a complete prohibition but
S S
subject to the four exceptions mentioned above. But even with those
T
exceptions, I would accept that the measure is a substantial restriction on T
an owner’s right to use a lift in a building. It is more serious than, for
U U
V V
- 29 -
A A
example, the measure in Music Advance, supra, where the passenger lifts
B B
were closed only for 8 hours a day and the floors affected remained served
C by a cargo lift throughout. C
D D
68. As to the question of reasonableness, it has to be borne in mind
E that, first, building management is a matter primarily for the manager and E
the owners corporation of a building. On many issues there will be a range
F F
of reasonable options open to the management. Within that range it is not
G for the Tribunal itself to manage the building and substitute its own G
decisions on what are reasonable management measures: see Steak Expert
H H
Holdings Ltd v Incorporated Owners of Jade Plaza (Tsuen Wan)
I (HCMP 3233/2015, 21 January 2016), §8. I
J J
69. Secondly, it needs to be recalled that an appeal lies from the
K Tribunal only in point of law. The Tribunal’s assessment of reasonableness K
in this regard, in so far as it lies within the range of tenable opinion, will not
L L
generally raise any issue of law susceptible to appeal.
M M
70. Thirdly, the view reached by the Tribunal in the present case
N N
has to be seen in the context. In particular:
O O
(1) There were real and valid security and nuisance concerns
P P
during 2009 and 2010 before the measure was imposed in
Q response. (Indeed, at the hearing Mr Chan SC clarified that it Q
is not his argument that the Resolution in 2010 was
R unreasonable.) R
S (2) There was no request by Whole Grand to the Owners S
Committee or the Manager to re-open Lift A at the 1/F for
T T
some 8 years until 2018.
U U
V V
- 30 -
A A
B
(3) In the litigation and indeed in the pre-action solicitors’ letter, B
Whole Grand asserted an absolute right to the use of Lift A.
C The reliefs it claimed were tied to that assertion. It was not C
made clear to the Tribunal that the reasonableness of the
D D
measure imposed was an issue that the Tribunal needed to
E determine in connection with the reliefs claimed: see Judgment, E
§§79-80.
F F
(4) Because Whole Grand considered it had an absolute right, it
G did not engage with the IO at all with a view to addressing the G
concerns of the other owners but took a “wholly
H H
uncompromising and uncaring attitude”.16 It may be that with
I the Escalator having been repaired and kept in good working I
condition, and if Whole Grand and its tenant refrain from
J J
giving the main entrance passcode to visitors, the problem
would not be as serious as before, though this was not how the
K K
case was put below or in the notice of appeal. And it may be
L that with sensible communications in good faith, it can be L
shown that the nuisance and security concerns are unlikely to
M M
arise or can be addressed by less drastic measure than making
N
Lift A skip the 1/F at all times save when the exceptions apply. N
The judge did envisage that attempts could be made to address
O the residents’ concerns, through ways of controlling the O
volume of visitors and preventing them from entering the
P P
residential areas via the 1/F.17 Counsel for Whole Grand has
Q also raised before us the suggestion of a lift access control Q
system, though it is misconceived for them to criticise the
R R
judge for omitting to consider this as an “obvious solution to
S S
T T
16
Judgment, §103.
17
Judgment, §85.
U U
V V
- 31 -
A A
B
the security concern” when their client had adopted a wholly B
unneighbourly approach.
C C
71. The judge’s opinion on reasonableness was arrived at in the
D D
particular circumstances presented to the Tribunal. As she stated at §90 of
E the Judgment: E
F “ To sum up on the question of the reasonableness of the measure F
taken (assuming it is in issue), I do not consider it unreasonable
for the manager and the respondent not to provide lift service to
G 1/F in light of the circumstances of the present case. The G
circumstances include, inter alia, their valid concerns over
H security and nuisance, the features in the physical layout of the H
Building, the applicant’s attitude and behavior as well as the
lack of means of access for the residential owners to commute
I between the ground floor and their units as compared to the I
better accessibility of 1/F (which justified the giving of priority
J
to the residential owners over 1/F visitors on the use of lifts).” J
K 72. In my judgment this is an opinion the Tribunal was entitled to K
come to on the facts of this case. I do not think that Whole Grand has
L L
demonstrated that there is any error of law in that conclusion.
M M
73. As to the allegation that the judge failed to examine whether a
N N
fair balance has been struck, counsel for Whole Grand refer to the fourth
O stage of the proportionality test as set out in Hysan Development Co Ltd v O
Town Planning Board (2016) 19 HKCFAR 372. I do not see how this
P P
concept applicable in relation to fundamental rights in public law cases has
Q any application in the present case: see Lee Yin Hong v Serenade Cove Q
[2011] 5 HKLRD 660, §11. In any event, the whole thrust of the section of
R R
the Judgment on reasonableness is to set out the judge’s views on balancing
S Whole Grand’s right with the Manager’s powers and the other owners’ S
rights.
T T
U U
V V
- 32 -
A A
Ground 9
B B
74. Under Ground 9 it is said that the Tribunal erred in failing to
C C
take account of the impact of the BPR and DDO. The Tribunal may be
D correct in saying that it has no jurisdiction to try claims for relief concerning D
disability discrimination or breaches of fire regulations, but in my view this
E E
does not mean that it cannot deal with or take account of allegations that the
F closure of a lift is contrary to the BPR and DDO in determining the true F
legal position as between an owner and the building Management in relation
G G
to the use of a lift.
H H
75. However, the IO has clarified that the restriction imposed does
I I
not apply to persons with mobility problems or in case of fire. Counsel for
J Whole Grand submit that this clarification was only given after the incident J
K
on 28 September 2019 (see §19 above). But even in that unfortunate K
incident, the disabled person was eventually given access to Lift A. I do
L L
not think that there is any material legal error in the Tribunal’s approach
M
that should impugn its overall conclusion. M
N Ground 10 N
O O
76. Finally, counsel submit that the Tribunal’s refusal to grant
P
declaratory relief in favour of Whole Grand was plainly wrong. Referring P
to Convoy Global Holdings Ltd v Kwok Hiu Kwan [2021] HKCA 1594 at
Q Q
§29 (which in turn refers to the three requirements set out by DHCJ To in
R Koo Ming Kown v Rev Mr Mok Kong Ting (HCA 2337/2016, 4 May 2018) R
at §20), they submit that (1) there was a real issue between the parties;
S S
(2) Whole Grand had and still has a genuine interest in obtaining the
T declarations; and (3) the IO was a proper contradictor. T
U U
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- 33 -
A A
77. I do not understand the IO or the Tribunal to have disputed
B B
these three elements in the present case. The difficulty for Whole Grand
C was that it asserted an absolute and unrestricted right to use Lift A and that C
this assertion underpinned the declarations it sought.18 As the judge did not
D D
accept there was any such absolute right, naturally she refused to make the
E declarations. There is nothing raised in the notice of appeal to fault this E
reasoning. There was no narrower declaration (such as one limited to
F F
rejecting the IO’s construction of clause 3.2.1 of the DMC) proposed to the
G G
Tribunal. Even in the notice of appeal the reliefs claimed are the same wide
H
declarations. During his oral submissions in this court, Mr Chan SC H
suggested adding the words “subject to proper exercise of the right of
I I
management under the DMC” to the declarations and injunction sought as
J
referred to in §22(1), (2) and (4) above. But I would decline to disturb the J
order below, in the absence of any legal error demonstrated. In any event,
K K
as Mr Ho SC pointed out on behalf of the IO, it would be pointless to make
L declarations that amount in substance to no more than paraphrasing the L
provisions of the DMC.
M M
N
78. There is no error of law made out under this Ground. N
O Conclusion O
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79. For the above reasons, I would hold that none of the grounds
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of appeal has been made out. It follows that the appeal must in my view be Q
dismissed. I would make an order nisi that Whole Grand do pay the IO the
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costs of the appeal.
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See Judgment, §104.
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Hon Chow JA:
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80. I agree with the judgment of G Lam JA.
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F (Susan Kwan) (Godfrey Lam) (Anderson Chow) F
Vice President Justice of Appeal Justice of Appeal
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Mr Edward Chan SC & Mr Li Pak Hei, instructed by Messrs. Howell & Co,
for the Applicant (Appellant)
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Mr Ambrose Ho SC & Ms Becky Wong, instructed by Messrs. Chung &
J Kwan, for the Respondent (Respondent) J
K K
L L
M M
N N
O O
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T T
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