DIRECTOR OF LANDS v. PENNY\'S BAY INVESTMENT CO LTD

DIRECTOR OF LANDS v. PENNY\'S BAY INVESTMENT CO LTD

The Court held that 'godown purposes' in clause 3(a) of the Grant does not cover mid‑stream or open storage — a 'godown' denotes a building for storage — and that for the 'after' valuation the correct statutory hypothesis is to assume at the valuation date that the reclamation (the cause of loss of marine rights)...

Source-derived case information.

Citation
DIRECTOR OF LANDS v. PENNY\'S BAY INVESTMENT CO LTD
Parties
Applicant/appellant (facv 1/2017); Respondent (facv 2 9/2017): Penny's Bay Investment Company Limited; Respondent (facv 1/2017); Appellant (facv 2 9/2017): Director of Lands
Court
Court of Final Appeal
Jurisdiction
Hong Kong
Judgment Date
16 October 2017
Case Number
FACV3/2017
Procedural Posture
Final Appeal (civil) / Judgment of the Court of Final Appeal
Outcome
Penny's Bay Investment Company's appeal dismissed; Director of Lands' appeal allowed.
Legal Topics
Injurious Affection, Marine Rights Extinguishment, Restrictive User Covenant Interpretation, Valuation Assumptions at Valuation Date, Betterment/set Off, Statutory Compensation Under FSRO S12
Source Language
en
Land Law Compulsory Acquisition and Compensation Reclamation Law Valuation Law Contractual User Covenants Administrative Law Injurious Affection Marine Rights Extinguishment +4 more

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Parties

Penny's Bay Investment Company Limited

Applicant/appellant (facv 1/2017); Respondent (facv 2 9/2017)

Director of Lands

Respondent (facv 1/2017); Appellant (facv 2 9/2017)

Procedural Posture

Final Appeal (civil) / Judgment of the Court of Final Appeal

Legal Issues

  1. 1 Whether the restrictive user covenant 'godown purposes' in the Grant includes mid‑stream/open storage use
  2. 2 Whether the after valuation as at 5 May 1995 should be carried out on the assumption that the Container Terminal (CT) Scheme was certain to proceed (and/or that the Reclamation was bound to occur)
  3. 3 Whether events after the date of authorisation (5 May 1995) are to be taken into account in assessing compensation under section 12 FSRO

Ratio Decidendi

The Court held that 'godown purposes' in clause 3(a) of the Grant does not cover mid‑stream or open storage — a 'godown' denotes a building for storage — and that for the 'after' valuation the correct statutory hypothesis is to assume at the valuation date that the reclamation (the cause of loss of marine rights) was certain to occur, such that the market would, for valuation purposes, treat the CT Scheme as bound to proceed; accordingly PBIC's appeal on interpretation was dismissed and the Director's appeal on valuation assumption was allowed.

Court Disposition

Penny's Bay Investment Company's appeal dismissed; Director of Lands' appeal allowed.

Orders

  • PBIC to pay the costs of both appeals to the Director with liberty to the parties to file written submissions as to costs within 14 days of judgment
  • Order nisi that in the absence of written submissions the order shall stand as an order absolute