IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF FIRST INSTANCE
APPLICATION TO SET ASIDE A STATUTORY
DEMAND NO. 4 OF 2000
Coram: Hon Chung J in Chambers
Date of Hearing: 9 May 2000
Date of Judgment: 9 May 2000
J U D G M E N T
1. This is an application to set aside a Statutory Demand dated 1 February 2000. The background facts leading to this application canbe summarised as follows.
2. The Applicant (as tenant) entered into a tenancy agreement dated 5 November 1997 with the Respondent for a term of 2 years from 1November 1997 to 31 October 1999 at a monthly rent of $33,500.00. A deposit of $108,000.00 was paid by the Applicant to the Respondentpursuant to the said tenancy agreement. On about 7 April 1999, the Applicant made a request for a new 2-year tenancy from 1 November1999 to 31 October 2001 pursuant to s.119A of the Landlord and Tenant (Consolidation) Cap.7 by sending a Form CR103. This was agreedto by the Respondent. However, the parties failed to agree on the amount of monthly rent for the new tenancy.
3. On about 9 November 1999, the Lands Tribunal made an order for the grant of a new tenancy pursuant to s.119D(1) of Cap.7. The LandsTribunal also determined the rent of the new tenancy to be $22,900.00 per month pursuant to s.119K(1) of Cap.7. Further, the LandsTribunal ordered that all other terms and conditions of the new tenancy should remain unchanged. On about 22 November 1999, the Applicantfiled an Interlocutory Application to review the said order. After a review hearing dated 7 December 1999, the Lands Tribunal revisedthe said order by deleting the part ordering that all other terms and conditions of the agreement should remain unchanged.
4. Under the provisions of Cap.7, when the Lands Tribunal makes an order for the grant of a new tenancy:-
5. The second of the 2 aforesaid matters has not been agreed between the Applicant and the Respondent and is yet to be determined bythe Lands Tribunal, the original hearing of 13 March 2000 for this determination having been adjourned because of the present application.
6. The Applicant argues that the Statutory Demand ought to be set aside because “on the evidence there is a genuine triable issue” asto his liability to pay the sum referred to in the Statutory Demand. In essence 2 such issues are raised: –
Is Issue (a) triable or arguable?
7. Clause 4(d) of the old tenancy agreement provides inter alia that:-
8. The purpose of this clause is clear and easy to understand. It was intended to enable the landlord to have a reasonable time to ascertainwhether the tenant has complied with the terms and covenants of the tenancy agreement. I therefore conclude that the phrase “deliveryof vacant possession” in this clause refers to an actual handing over of the physical possession of the property to enable the landlordto do so.
9. It is undisputed that the Applicant has been in possession of the listed property up to now. For the above reasons, I find that theRespondent’s obligation to return the rent deposit has not arisen yet. There is therefore no arguable case that the Applicant isentitled to a “counterclaim, set-off or cross-demand” in connection with this sum.
Is Issue (b) triable or arguable?
10. S.119L(1) contains 3 sub-paragraphs. It is common ground that sub-paras. (a) to (b) are inapplicable to the present case and theissue is whether sub-para. (c) is applicable. This sub-paragraph reads:-
11. It is again undisputed that no lease or agreement for a new tenancy has been executed yet because only the duration and the amountof rent of the new tenancy have been determined by the Lands Tribunal. The other terms and conditions are, as stated above, yet tobe determined. In these circumstances, I disagree with the Applicant’s argument that the Respondent has failed to comply with s.119L(1)of Cap.7 because when no lease or agreement for a new tenancy has been executed, the provisions of s.119L(1) or (2) are inapplicable.
12. For the above reasons, this application is dismissed.
Ms Lorinda Chih Wai Lau, instructed by Messrs Oliver C M Chan & Co., for the Applicant
Miss Gekko Lan, instructed by Messrs Joseph S C Chan & Co., for the Respondent