Wing Hong Investment Co Ltd v Fung Sok Han
Court of First Instance
High Court Action No. 2075 of 2009
Louis Chan J
Land Law
25 September 2015

Building management – change of user – change of user materially different to user stated in occupation permit – change did not breach clause in deed of mutual covenant prohibiting illegal use of premises – Buildings Ordinance (Cap. 123) s. 25

P was the owner and developer of three sections of a land lot (the “Sections”). P developed a building on each of the three Sections which were linked together by common internal corridors on each floor and served by the same lifts, and which functioned as one building (the “Building”). P still owned seven of the eight ground floor units and four units on the floors above. D2–4 were the incorporated owners of the respective three buildings and D1 was the chairwoman of D2. Of the issues in dispute, one included a claim by Ds that the conversion by P of the carport into shops and godowns was contrary to the user as stated in the occupation permits and hence illegal and in breach of a clause of the deeds of mutual covenants (the “DMCs”) which prohibited illegal use of the premises.

Held, ruling in favour of P, that:

  • Although P’s change of user from carport to shops and godowns on the ground floor was not in line with the occupation permits, it was not illegal and did not contravene the DMC. Section 25 of the Buildings Ordinance (Cap. 123) was relevant. The provision in s. 25(1) required the person intending the material change of user to serve on the Building Authority (the “BA”) a notice of intended change. It was not a crime to adopt a material change in the user of the premises, but it was an offence under s. 40(2) of the Ordinance not to serve a notice to the BA under s. 25(1). If the changed or intended new user was not acceptable to the BA, it could always serve an order under s. 25(2) to prohibit the intended user or require the changed user to be discontinued. But there was no provision saying that it was an offence to adopt a user of the premises which was materially different from that stated in the occupation permit.
  • If the legislature had intended to make it an offence for a material change of user without approval from the BA, it would have legislated for it in s. 40 which contained dozens of offences for infringements of the provisions of the Ordinance.

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