CACV 98/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF APPEAL
CIVIL APPEAL NO. 98 OF 2004
(ON APPEAL FROM HCA NO. 1208 OF 2000)

BETWEEN
CHIN LAN HONG 1st Plaintiff
HONG KONG RICHES LIMITED 2nd Plaintiff
LOVABLE DEVELOPMENT LIMITED 3rd Plaintiff
EASIFAST COMPANY LIMITED 4th Plaintiff
and
CHEUNG POH CHOO 1st Defendant
CHEUNG PHEI CHIET 2nd Defendant
CHEUNG PUI YUEN 3rd Defendant
(the 2nd and 3rd Defendants being sued together as
Administrators of the Estate of Cheung Chin
Chye, deceased)

Before: Hon Rogers, Woo VPP and Le Pichon JA in Court

Date of Hearing: 19 July 2005
Date of Handing Down Judgment: 28 July 2005

JUDGMENT
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Hon Rogers VP:

1. I have had the advantage of reading the judgment of Le Pichon JA in draft

and there is nothing I can add.

Hon Woo VP:

2. I entirely agree with the judgment of Le Pichon JA.

Hon Le Pichon JA:

3. This is an appeal and cross-appeal from the judgment dated 15 January 2004
of Deputy High Court Judge To. The proceedings concerned the right of the 1st
defendant to occupy the property known as No. 4A South Bay Road (“the
property”) after the expiration of a notice to quit served on her by the plaintiffs
on 24 December 1999. The judge found that the 1st, 2nd and 3rd defendants were
guilty of trespass in respect of the 1st defendant’s occupation of the property for
nine days between 2 and 11 October 2000 and awarded the plaintiffs damages
which he assessed at $36,812.90 together with interest. It was also ordered that
the property be sold by public tender with a reserve price but that part of the
order was made with the consent of the 2nd and 3rd defendants and does not form
the subject matter of the appeal and cross-appeal. At the conclusion of the
hearing, judgment was reserved which we now give.

The facts

4. Cheung Kung Hai (“the father”) was a wealthy Singaporean businessman.

He came to Hong Kong in 1961 and built an eight-bedroomed house on the
property in 1967 as a home for his wife Lim Bee and the eight children of that
marriage consisting of a son Cheung Chin Chye (“CCC”) and seven daughters
including the 1st defendant.
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5. The father had a concubine namely, the 1st plaintiff with whom he had three
sons, Cheung Kee Wee (“CKW”), Cheung Lin Wee (“CLW”) and Cheung Ying
Wee (“CYW”) and three daughters. The 1st plaintiff and her children lived in a
flat at No.4 South Bay Road and at a later date in a house in Black’s Link. The
judge found that the relationship between the half siblings was less than
harmonious.

6. The father also had two adopted sons, Cheung Theam Siew (“CTS”) and the
late Cheung Kwong Wai. Three of the daughters including the 1st defendant are
unmarried.

7. Starting from 1967, the 1st defendant assisted in the family business together
with CTS. In 1975, when she was sent to take charge of the family business in
Singapore, she maintained a room in the property which she used whenever she
returned to Hong Kong. In 1976, CKW joined the family business in Hong
Kong. Lim Bee died in 1977. At about that time the 1st defendant returned to
work in Hong Kong and lived in the property.

8. The family business which was property orientated experienced financial

difficulties in the early 1980s when uncertainty over the future of Hong Kong
led to a drop in the property market. On 30 October 1982, the father assigned
his interest in the property to the 1st plaintiff, CCC, CKW, CLW and CTS in
equal shares as tenants in common (“the 1982 assignment”). The judge found
that the assignment was made to protect the property from possible enforcement
action by creditors of the family business as the father was the guarantor of the
business debts. Given that finding, he had little difficulty in holding that the
presumption of a gift to the 1st plaintiff and 4 sons had been rebutted. The
father was to live for another 18 years after the 1982 assignment. As will
become apparent, he remained in possession either actually or through Lim
Bee’s children right up to his death in October 2000.
 - 4 -

9. In 1984, the father and the 1st plaintiff relocated to Taiwan and the 1st
defendant was again sent to work in Singapore. She nevertheless maintained a
room in the property for her use whenever she was in Hong Kong. The father
maintained control of the Hong Kong business from Taiwan, with CTS and
CKW being responsible for the day-to-day management in Hong Kong. At
about this time, CLW also joined the family business in Hong Kong. In the
following year, CTS emigrated to Canada and re-assigned his 1/5 share in the
property to the 4th plaintiff in exchange for some assets from the father. The
judge, apparently erroneously (although nothing turns on this) thought that the
4th plaintiff was owned and controlled by CKW, CLW and CYW when it was in
fact owned by Doran Ltd which the father and the 1st plaintiff controlled at the
time and only later came to be controlled by CKW, CLW and CYW. The judge
summed up the situation in 1985 as follows:

(1) Lim Bee’s children were ousted from the family business in Hong
Kong and were replaced by the 1st plaintiff’s sons; and

(2) the 1st plaintiff’s sons together with the 1st plaintiff became the legal
owners of 4/5ths of the family home for Lim Bee’s children but the
de facto possession remained unchanged.

10.In the late 1980s, CLW and CKW assigned their respective interests in the
property to the 2nd and 3rd plaintiffs, companies which they respectively
controlled.

11.When the father and the 1st plaintiff returned to live in Hong Kong in 1987,
they did not move to live in the property; rather, they resided in a house in
Shatin. The property remained as a home exclusively for Lim Bee’s children.
By 1989, CPK, a sister of the 1st defendant was the only person living in the
property although the 1st defendant who was still working in Singapore
maintained a room which she used whenever she returned to Hong Kong. CPK
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accepted the father’s offer to buy her a flat in Repulse Bay and moved out of the
property in 1990. Although a similar offer had been made to the 1st defendant,
she declined. When the father and the 1st plaintiff moved into the property in
1990, the 1st defendant who was still working in Singapore, continued to
maintain a room there and used it whenever she was in Hong Kong. The father
renewed his offer to purchase a flat for the 1st defendant in 1995 but the 1st
defendant did not take it up.

12.CCC died in Singapore in 1995. On 27 November 1996, letters of

administration were granted in Singapore to the 2nd and 3rd defendants who are
his sons and the sole beneficiaries of his estate. They obtained a re-sealed grant
of administration to CCC’s estate in Hong Kong on 11 October 2000.

13.The 1st defendant returned from Singapore in 1996 and lived in the property
with the father and the 1st plaintiff. In May 1996, the father was diagnosed as
suffering from a brain tumour. That affected his walking ability, obliging him
to use a wheelchair whenever he went out. He and the 1st plaintiff moved to a
flat in Grenville House in late 1996. The judge found that he did so for health
reasons and rejected the plaintiff’s case of constructive exclusion by the 1st
defendant particularly as the 1st plaintiff who was in a position to give first hand
evidence of the 1st defendant’s alleged intolerable behaviour was never called to
give evidence in support of the plaintiffs’ case. The father’s health continued to
deteriorate. He had operations in January 1997, August 1998 and September
2000.

14.After her return to Hong Kong, the 1st defendant began to suspect that she
was being systematically excluded from the family business. When she
complained to her father that her half siblings CKW and CLW were receiving
higher salaries than herself, she was told that her salary included an element of
rent-free accommodation in the property. Whilst there had been unhappy
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quarrels between the 1st defendant and the family companies particularly in the
second half of the 1990s, the judge found that there was no evidence to suggest
that any of the plaintiffs or the father objected to the 1st defendant’s occupation
of the property.

15.In about 1999, the 1st defendant had further complaints about various matters
relating to the family business including a complaint concerning the receipt of
salary by one of her half sisters from the family business without working for
any of the family companies. Those disputes led to the issue of a notice to quit
on 24 December 1999 by the 3rd plaintiff on behalf of the plaintiffs (who were 4
out of 5 tenants in common) requiring her to vacate the property within 30 days
“assuming that [the 1st defendant] had been occupying the property as a
licensee”.

16.The 1st defendant and one of her sisters had a meeting with the father on 17
February 2000 in the presence of the 1st plaintiff. The 1st defendant produced a
tape recording and a transcript of the conversation that took place during the
meeting. The judge summarised the gist of that conversation at paragraph 45 of
his judgment:

“When the 1st Defendant asked if the Father knew about the action
taken by the half-siblings to evict her from the Property, the Father
said unequivocally that he did not know. He did not categorically tell
the 1st Defendant that he had revoked her licence or that what the half-
siblings did was with his consent or words to that effect. … This
evidence was not challenged by the Plaintiffs.”

17.Several events occurred on 31 May 2000. On that day, the father signed an
affirmation to the effect that he had never granted any permission to the 1st
defendant to remain on the property for so long as she wished, that he moved
out to avoid quarrels, that he did not recall the conversation with him on 17
February 2000, and that the writ seeking vacant possession from the 1st
defendant was issued on 1 February 2000 with his knowledge and consent. The
 - 7 -

affirmation which was written in English was signed in the presence of Mr Sit, a
solicitor. Mr Sit who had interpreted the contents to the father was satisfied that
the father understood the contents before signing the affirmation. However, the
judge gave no weight to it because the judge concluded that what the father had
said in that affirmation was unreliable given the fact that although he had been
given details of the February 2000 conversation with the 1st defendant, the
father said in his affirmation that could not recall the conversation at all having
regard to the fact that the evidence of that conversation and its contents were
unchallenged. Also on 31 May 2000, the 1st defendant’s employment by the
family companies was terminated.

18.The father died on 2 October 2000.

19.The judge accepted the evidence of the 2nd and 3rd defendants that the 1st
defendant had their consent to live at the property and that she also had the
consent of CCC to do so before his death in 1995.

20.Based on those facts, the judge reached the following conclusions:

(1) the 1st defendant had implied authority from the plaintiffs to reside
in the property at least until the expiration of the notice to quit by
23 January 2000;

(2) the 1st defendant’s entitlement to reside in the property as part of

her remuneration package for working in the family business
terminated on 31 May 2000 when her employment by the family
companies came to an end;

(3) the fact that Lim Bee’s children remained in undisturbed possession
of the property for about 20 years after the 1982 assignment
coupled with the fact that the assignment was not a gift nor made
 - 8 -

for valuable consideration gave rise to an irresistible inference that

the assignees of the 1982 assignment took the legal title subject to
certain obligations;

(4) those obligations were described by the judge (at paragraph 27 of

his judgment) in the following terms:

“27. … it was understood by members of the family, including the

1st Plaintiff, the 1st Defendant and her half-siblings to whom the
Property was assigned, that despite the assignment, the Property would
remain as the family home for the Lim Bee’s line of children and that
the Father, as head of the family, would continue to make decisions as
regards the Property, though he no longer held its legal title. What in
fact she was saying in laymen’s term is that the Property was held on
trust by the assignees for the Father, even though it was not so pleaded.
Accordingly, I find that despite the assignment, the Father remained as
the beneficial owner of the Property, at least to the extent of a life
interest in the Property. He may remain in possession in the Property
for as long as he wished and may grant licence to anyone to use and
enjoy the Property. …”

(5) given the father’s interest in the property, he had the power to and
did grant the 1st defendant a licence to stay in the property which
was never revoked during his lifetime; and

(6) the 1st defendant’s occupation of the property was non-exclusive.

21.Although the judge rejected the 1st defendant’s defences based on family
tradition, arrangement or understanding in favour of an unmarried daughter and
estoppel, his findings summarised above meant that the plaintiffs’ claim in
trespass prior to 2 October 2000 fell to be dismissed. As to the 1st defendant’s
occupation after the death of the father on 2 October 2000, it was contended on
her behalf that she was entitled to do so with the permission and as the
“representative or agent” of the estate of CCC.

22.The judge held that (1) until the re-sealing of the grant in Hong Kong on 11
October 2000, the 1st and 2nd defendants had no interest in the property; (2)
 - 9 -

beneficiaries under an intestacy have no beneficial interest in the assets of the

estate and the 2nd and 3rd defendants as CCC’s beneficiaries were not in a
position to grant the 1st defendant a licence to occupy the property applying
Commissioner of Stamp Duties v Livingstone [1965] AC 694; (3) the 2nd and 3rd
defendants from the date of re-sealing of the grant as administrators of CCC’s
estate were entitled to authorise the 1st defendant to occupy, use and enjoy the
property on a non-exclusive basis on their behalf whether as agent or licensee;
and (4) that such licence could not be terminated by the plaintiffs without the
consent of the 2nd and 3rd defendants. Those findings meant that between 2 and
11 October 2000, the 1st defendant was in occupation as a trespasser and he so
held. The damages awarded in favour of the plaintiffs for that period were
based on 4/5ths of the rental value of the property, which the judge assessed at
$36,812.90.

The appeal

23.The appeal focused on two matters: (1) the father’s life interest in the
property; and (2) the ability of the 2nd and 3rd defendants as representatives of
the estate of one of the tenants in common to grant a licence to the 1st defendant.

Life interest

24.The thrust of the argument was that it was not open to the judge on the
pleadings to find that the father had a life interest in the property. It was said
that even if there had been the understanding that notwithstanding the 1982
assignment, the father could deal with the property as he liked, that would not
have created any proprietary interest in the property. Any obligation in that
context could only have been binding either in personam or as a matter of
honour. It was also said that a person who only had a life interest was not in the
position to dictate how the property was to be dealt with.
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25.In paragraph 8 of the re-amended defence of the 1st defendant, particulars

were given of the assertion that she had been occupying the property pursuant to
a family arrangement. Paragraph (11) read as follows:

“(11) In the early 1980s the Cheung family group of companies

controlled by the said Cheung Kung Hai experienced financial
difficulties; the said Cheung Kung Hai had personally
guaranteed repayment of loans made to those companies; in
order to avoid the Property being the subject of enforcement
proceedings, the said Cheung Kung Hai caused ownership of
the Property to be transferred to his second wife Chin Lan Hong
(the 1st Plaintiff) and to his sons, namely, Cheung Chin Chye,
Cheung Theam Siew, Cheung Kee Wee and Cheung Lin Wee;
the said transfers were made on the understanding between
Cheung Kung Hai, the said transferees and all members of the
family that the Property was, and would continue to be, the
family home and that the said Cheung Kung Hai, as head of the
family, would continue to make decisions as regards the
Property despite its no longer being registered in his name and
that the Property would continue to be available for members of
the family to live in.”

There was a request for further and better particulars directed at the alleged
understanding of the property remaining the family home as to whether it
constituted a binding contract or is otherwise enforceable at all and, if so, the
legal basis thereof. The following particulars were given:

“(5) A licence revocable in limited circumstances (namely the

provision of equivalent alternative accommodation by the
paterfamilias) only, binding upon the Plaintiffs in equity.”

There was never any request made of the understanding regarding the father’s
right to “continue to make decisions”.

26.Mr Shieh SC who appeared for the plaintiffs submitted that that answer
given to the request was inconsistent with any suggestion of the carving out of a
life interest for the father and the father then granting a licence. But when fairly
read, the answer stated quite clearly that the 1st defendant was asserting a
licence granted by the father and which was binding on the plaintiffs in equity.
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It was further submitted that the plaintiffs’ understanding of the 1st defendant’s
case that her right to live at the property was linked to the unmarried daughter’s
equity which did not find favour with the judge. But the 1st defendant’s
pleadings amounted to this: notwithstanding the 1982 assignment, there was a
family understanding to the effect that not only could the father continue to use
the property as a family home, but also that as regards any matter that had to do
with the property, in colloquial language, the father would still be “calling the
shots”. Those matters must, it seems, include any decision to renovate,
redevelop, lease or sell the property. That right or interest must necessarily
encompass a right to grant the 1st defendant a licence to occupy the property on
a non-exclusive basis. Once granted, that licence would be binding on the
plaintiffs in equity and whilst it was revocable by the father, he could only do so
in limited circumstances, namely, by providing the 1st defendant with the
equivalent alternative accommodation.

27.In paragraph 27 of his judgment (cited above), the judge accepted the 1st
defendant’s evidence as regards the family understanding concerning the 1982
assignment outlined above. As I understand it, this appeal has not been put on
the basis that the judge’s finding of the existence of the family understanding
that the father would continue to make decisions regarding the property should
be reversed. In other words, no challenge is being made in the appeal against
this finding of fact. That being so, it must follow from that finding that despite
the 1982 assignment, the father did retain a beneficial interest in the property.
Whether or not the judge was correct to describe that interest as a “life interest”
in the property matters not.

28.It was urged before this court that a finding of “a full beneficial ownership”
would have serious estate duty implications. But the possibility of such
implications arising ought not deter the court from reaching such a conclusion if
warranted by the evidence and if necessary for the resolution of the issue
 - 12 -

between the parties. In my view, it is unnecessary to explore the precise

parameters of that interest or to give it a label because during the lifetime of the
father, at a minimum, it was an interest that enabled him to grant the 1st
defendant a licence to occupy the property non-exclusively during his lifetime
which was binding in equity on the plaintiffs.

29.I should briefly mention the plaintiffs’ fallback position. It was said that the
father had, at the latest by 31 May 2000, withdrawn any permission for the 1st
defendant to remain in occupation. This submission was grounded upon the
affirmation signed by the father in the presence of Mr Sit, a solicitor whose
unchallenged evidence the judge had found to be of “undoubted credibility”.
As noted above (see paragraph 17), the judge attached no weight to Mr Sit’s
evidence. Suffice it to say that on no view could it be said that the judge was
plainly wrong in so doing. To the contrary, there was ample material before the
judge to warrant the finding made. The following extract is from Mr Sit’s
evidence:

Q. I see. And when you said he wasn’t in full control of his

faculties, one example is, he wasn’t able to converse with you
normally like other people. So is it correct that he had some
difficulty in talking, was that what you were describing?
A. Say that I can’t remember exactly what I said to him when I
started. I would have -- after sitting down, I asked him if he was
the person I was supposed to take the affirmation from, I would
have asked him if he was Mr Cheung Kung-hai…
…
A. I would have asked him something like, “Are you Mr Cheung
Kung-hai”, and if he was normal, he would have said to me like,
“Yes, I am indeed that person. Thank you for coming over here,”
something like that.
Q. Right.
A. But he just respond in the affirmative, by nodding his head.
Q. He just nodded, I see.
A. He might have said “yes” in the process, but he didn’t say much
and judging from the fact that he had his nurse with him, I had
 - 13 -

the feeling that perhaps he wasn’t -- he wasn’t in full control of

his faculties.

(Tr. p. 118D-L)

Its significance is brought home by a careful reading of the transcript of the

conversation that took place only 3 months earlier in February 2000 (referred to
in paragraph 17 above). It shows that the father, then 85 and ailing, was not a
person in control of his faculties. It gave the impression of a sick and elderly
man mechanically repeating what the 1st plaintiff had reminded him of without
any real recollection or understanding, susceptible to manipulation and a person
with an apparent lack of memory. The latter alone would negate “informed”
consent. There is simply no basis for interfering with the judge’s treatment of
the evidence.

Whether one of several tenants in common may grant a non-exclusive licence

30.In practical terms, the question is whether the 2nd and 3rd defendants could
validly grant the 1st defendant a licence to occupy the property on a non-
exclusive basis as from 11 October 2000 notwithstanding objections from the
other tenants in common. Mr Shieh SC relied on Annen v Rattee [1985] 1
EGLR 136 and Robson-Paul v Farrugia (1969) 20 P&CR 820 for the
proposition that one of several tenants in common may not unilaterally and
against the wishes of the other tenants in common grant a licence to a third-
party that was effective against the other tenants in common, the corollary of
which may be put on the basis that a co-owner may terminate a licence granted
by another co-owner to occupy the property jointly owned by them.

31.I propose, first of all, to consider the rights of legal tenants in common.
Their rights were stated by Denning LJ in Bull v Bull [1955] 1 QB 234 at 237 in
these terms:
 - 14 -

“Each of them is entitled to the possession of the land and to the use
and enjoyment of it in a proper manner. Neither can turn out the other;
but if one of them should take more than his proper share the injured
party can bring an action for an account. If one of them should go so
far as to oust the other he is guilty of a trespass: see Jacobs v. Seward.
Such being the rights of legal tenants in common, I think that the rights
of equitable owners in common are the same, save only for such
differences as are necessarily consequent on the interest being
equitable and not legal. It is well known that equity follows the law;
and it does so in these cases about tenants in common as in others”.
(emphasis added)

These rights were more recently considered in the decision of Paterson J in U-

Needa Laundry Ltd v Hill [2000] 2 NZLR 308:

“[24] … Because a tenant in common has an undivided share, that

tenant is free to deal with his or her share as he or she sees fit. On the
other hand, joint tenants do not have undivided shares. In the case of
joint tenants, as the property or rights are held jointly, a transfer or
lease must be by or under the authority of all interested. Because of
the unity of title, it is not possible for one co-owner to deal with the
property without the authority of others. That is not the position with
tenancy in common as the co-owner is only dealing with his or her
particular interest in the title. It is the interest of the co-owner which is
being leased and which entitles the lessee to possession to be shared
with the other co-owners.

[25] For the above reasons I am of the view that the statements in
the English authority are not relevant to the legal rights of tenants in
common in New Zealand. The position in New Zealand is as it was in
the United Kingdom before the passing of the Law of Property Act
1925 (UK). That position was stated in Woodfall: Landlord and
Tenant in para 2.102 as follows:

‘Tenants in common needed to have only unity of

possession; they might have unequal shares, and there was no
right of survivorship. Each tenant in common could at common
law make a lease in respect of his own share alone, the interest
of each being separate and distinct, and if tenants in common all
joined in one lease it operated as a lease by each of his
respective share, and a confirmation by each as to the shares of
the others.’”

32.The position in Hong Kong is similar to that in Australia and New Zealand
and in the United Kingdom prior to the 1925 legislation. A tenant in common is
entitled to deal, in whatever way he desires, with his own undivided share: he
may lease it or dispose of his right to possession to a stranger as he likes without
 - 15 -

the concurrence of the other tenants in common. See Incorporated Owners of

Chungking Mansions v Shamdasani [1991] 2 HKC 342 at 352 G-H.

33.What then of the authorities relied on by Mr Shieh? The first matter to note
is that both authorities are based on the decision of Lord Tenterden CJ in Doe d
Aslin v Summersett (1830) 1 B & Ad 135, a case concerning the rights of joint
tenants in law and in equity. In that case, the land in question had been devised
to the two lessors of the plaintiff as joint tenants. The question before the court
was whether a notice to quit, signed by one of two joint tenants, was sufficient
to put an end to the tenancy. In holding that the notice was sufficient, Lord
Tenterden CJ gave the following explanation (at page 739):

“But, though upon a joint lease by joint-tenants each demises his own
share, this is not the only operation of such a lease. Joint-tenants are
seised not only of their respective shares, per my, but also of the
entirety, per tout; Litt. s. 288. The rent reserved will enure jointly to
all the lessors; Co. Litt. 47 a. 192 a. 214 a.; and if any of them die, the
lessee shall hold the whole as tenant to the survivors. Upon a joint
demise by joint-tenants upon a tenancy from year to year, the true
character of the tenancy is this, not that the tenant holds of each the
share of each so long as he and each shall please, but that he holds the
whole of all so long as he and all shall please; and as soon as any one
of the joint-tenants gives a notice to quit, he effectually puts an end to
that tenancy; …”

34.As succinctly explained in the U-Needa case, a lease by a tenant in common

of his interest in the land operates differently: the lessee of that interest has to
share possession with the other co-owners which could lead to practical
inconveniences. In the U-Needa case at paragraph 26, Paterson J cited the
following passage from Re Marcellos (1940) 41 SR (NSW) 154, 155:

“The rarity of a lease by one of two tenants in common is explained by

the inconvenience to which it may lead, as illustrated in Woodfall on
Landlord & Tenant, 17th edn 15. But if one tenant in common is
willing to submit to or to create this inconvenience and can find a
lessee, there appears to me to be no objection in law to his granting a
lease.”
 - 16 -

35.In my view, the judge’s statement of the law, in particular at paragraphs 77

to 79 which Mr Shieh sought to impugn is correct. The 2nd and 3rd defendants as
representatives of the estate of CCC had the power to grant the 1st defendant a
licence to occupy the property on a non-exclusive basis. That licence could not
be determined by the other tenants in common without the consent of the 2nd
and 3rd defendants. Accordingly, the plaintiffs cannot maintain a claim in
trespass in respect of the 1st defendant’s occupation of the property as from 11
October 2000.

The cross appeals

36.The cross appeals relate to two issues: (1) whether the doctrine of relation
back applies to the facts of the present case such that as from the resealing of
the grant in Hong Kong on 11 October 2000, the 2nd and 3rd defendants could
grant the 1st defendant a licence to occupy the property on a non-exclusive basis
as from the death of CCC on 8 August 1995; (2) whether the 2nd and 3rd
defendant being the sole beneficiaries of CCC’s estate had the power to licence
the 1st defendant to occupy the property on a non-exclusive basis before the
resealing of the grant. There had been a third issue relating to ratification which
was not pursued at the hearing.

Relation back

37.As a general rule, an intended administrator has no power to do anything as

administrator before the grant of letters of administration. The doctrine of
relation back is an exception to that general rule. For the doctrine to apply, it
must be shown (1) that the person whose conduct is relied upon as binding the
estate should have been acting in the assumed character of an administrator, and
he does that if the act is done by him when professedly intending to take out
letters of administration so that he is an executor de son tort; and (2) that the act
 - 17 -

done should be for the benefit of the estate: see per Sir Alan Huggins VP in
Chan Pak-man v Chan Pang-fee [1981] HKLR 483 at 506I. Where the doctrine
applies, it results in the administrator being deemed to have been in existence at
the relevant time i.e. during the interval between the death and the grant of
administration: see Chan Pak-man at 494H. As Parke B observed in Foster v
Bates (1843) 12 M&W 226,

“… when one means to act as agent for another, a subsequent

ratification by the other is always equivalent to a prior command nor is
it any objection that the intended principle was unknown, at the time,
to the person intended to be the agent, the case of Hull v Pickersgill 1
Bro. & B. being authority for that position.”

38.In the present case, the evidence was that the 1st defendant had the consent
and permission of the late CCC to occupy the property. The 2nd and 3rd
defendants obtained a grant in Singapore on 27 December 1996. In late
1996/early 1997, the 2nd and 3rd defendants orally requested the 1st defendant to
look after the property as their agent and/or representatives.

39.Given those facts, I have no doubt that when the 2nd and 3rd defendants
requested the 1st defendant to look after the property as their agent and/or
representative, they were acting in the assumed character of administrators of
CCC’s estate. At that time they had just been, or were about to be, granted
letters of administration in Singapore. Whilst the grant was not to be resealed in
Hong Kong until 11 October 2000, there is no question but that they were the
intending administrators of CCC’s Hong Kong estate.

40.That leaves the question whether the act done was for the benefit of the
estate. The test is objective. It was submitted by Mr Shieh that a gratuitous
licence could not possibly have been of benefit to CCC’s estate. Moreover, it
prevented a sale or other profitable use of the property. But the benefit has to
be assessed from the point of view of CCC’s estate and not that of the other co-
owners of the property. The evidence of the 2nd and 3rd defendants was to the
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effect that they made their request because the 1st defendant was their aunt; she
was already living at the property; they enjoyed a close relationship with her as
did their father; they therefore trusted her to look after the interests of CCC’s
estate; and they themselves were living in Singapore and not Hong Kong. At
that time, the 1st defendant was the only person residing at the property
although, as the judge found, her occupation of the property was on a non-
exclusive basis. CCC’s estate was but one of five tenants in common and the
only one not based in Hong Kong. In those circumstances, it was unarguably in
the interests of the estate to have an agent or representative here to look after its
interests in the property. Whilst one may admittedly ‘look after’ a property
without residing in it, equally I can discern no disadvantage in having the
agent/representative residing there where the relationship with the other co-
owners have not been harmonious and it is certainly true that given Hong
Kong’s climate, a property is better lived in than left empty. That is nothing
more than plain commonsense. Therefore I have no difficulty in accepting that
the act done was for the benefit of the estate.

41.The plaintiffs placed reliance on Fred Long & Sons Ltd v Burgess [1949] 2
All ER 484 at 489H where it was held, inter alia, that the principle of relation
back cannot be applied so as to invalidate interests lawfully acquired in the
interval. The plaintiffs’ contention was premised on the 1st defendant being a
trespasser. But, as explained above, CCC’s estate had the power to grant a
licence to the 1st defendant over the objections of the other co-owners. That
being so, the 1st defendant’s occupation of the property did not and could not
give rise to any accrued cause of action in trespass which the application of the
doctrine would extinguish. The Fred Long case is therefore not of assistance.

42.For my part, I am of the view that both conditions for the doctrine of relation
back to operate were fulfilled with the consequence that the doctrine applied to
render legal the 1st defendant’s occupation of the property during the 9 days
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between the date of the father’s death on 2 October 2000 and the resealing of
the grant.

Reasonable notice

43.Even if I were wrong on the issue of relation back and the father’s licence to
the 1st defendant to occupy the property terminated with his death, she would
nonetheless be entitled to reasonable notice to vacate the property. When the
plaintiffs served the notice to quit on the 1st defendant on 24 December 1999,
she was given 30 days’ notice on the assumption that she was occupying the
property as a licensee. I do not see that it is open to the plaintiffs to contend
that a shorter period would be appropriate. In any event, it could certainly not
be less than nine days. This conclusion renders it unnecessary to deal with the
other point left in the cross appeals, namely, a beneficiary’s right to grant a
licence and I do not propose to do so.

Conclusion

44.Accordingly, I would dismiss the appeal and allow the cross appeals of the
defendants. I would also make an order nisi that the costs of the appeal be to
the defendants and the costs of the cross appeals here and below be to the
defendants.

(Anthony Rogers) (K. H. Woo) (Doreen Le Pichon)

Vice-President Vice-President Justice of Appeal
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Mr Paul Shieh SC and Mr Godfrey Lam, instructed by Messrs Cheung,

Tong & Rosa, for the 1st to 4th Plaintiffs/Appellants

Mr Wong Yan Lung SC, instructed by Messrs Dibb Lupton Alsop,

for the 1st Defendant/1st Respondent

Mr Thomas Au, instructed by Messrs Lovells, for the 2nd and

3rd Defendants/2nd and 3rd Respondents