Hong Kong Case Law: Decisions & Judgments

Topic

Relocation vs extinguishment

Legal area

Court

26 Jun 2009

HAPPY DRAGON RESTAURANT LTD v. THE DIRECTOR OF LANDS

Citation

HAPPY DRAGON RESTAURANT LTD v. THE DIRECTOR OF LANDS
Court

Lands Tribunal
Case number

LDLR17/2006

The Tribunal found no basis to review its prior judgment: on the facts the Applicant acted unreasonably by extinguishing the business when a suitable alternative (Wah Do) existed and there was no new evidence; disturbance claims were largely hypothetical or avoidable on relocation and not adequately proven as actual losses causally attributable to the resumption, so the Judgment awarding no compensation was confirmed.
14 Jan 2000

Dr. Lui Tat Hung v. The Director of Lands

Citation

Dr. Lui Tat Hung v. The Director of Lands
Court

Lands Tribunal
Case number

LDLR1/1998

The Tribunal confirmed that s.12(c) restricts compensation in respect of locational/site goodwill to the residue or relevant expectancy of the lease but does not apply to personal/floating goodwill; the Applicant had both locational and personal goodwill, and personal goodwill had effectively been recouped or compensated for the period 1/4/1997–31/3/1999 already awarded by the Tribunal, so s.12(c) precluded additional awards for 1999/2000 or permanent loss; accordingly the review was dismissed and the original award upheld.
22 Aug 1996

LAI Yuet Ngao t/a Hoi Yeung Commercial v. Director of Lands

Citation

LAI Yuet Ngao t/a Hoi Yeung Commercial v. Director of Lands
Court

Lands Tribunal
Case number

LDLR2/1995

Tribunal held applicant entitled to compensation under s.10(2)(d); on the evidence applicant lacked funds to relocate so award is on a total extinguishment basis; in absence of reliable trading records tribunal adopted a wages-and-salary cost approach cross-checked with rental approach to fix annual profit at $220,000 and applied a multiplier of 2 to determine goodwill of $440,000; took auction proceeds $3,000 as reliable indicator for perishable stock and applied a factor of 10 to reach market value $30,000 (loss on forced sale $27,000); accepted expert valuation with depreciation for fixtur…
9 Jul 1996

Fung Kai Yin and Others t/a Hang Lam Tong Sun Yung Seafood and Medicine Co. v. Director of Lands

Citation

Fung Kai Yin and Others t/a Hang Lam Tong Sun Yung Seafood and Medicine Co. v. Director of Lands
Court

Lands Tribunal
Case number

LDLR12/1995

Under s.10(2)(d) applicants were entitled to compensation restoring their business position absent resumption. The correct test for total extinguishment is whether, on all facts, the business operator can reasonably be expected to continue the business elsewhere (not the Shun Fung relocation trilateral test which applies only to relocation claims). Shops using the same trade name but with different partner combinations are distinct businesses and cannot be treated as continuations. Goodwill is to be valued by capitalizing normal profit trends: taxable profit 1992-93 of approx. HK$600,000 take…

Hong Kong Case Law

HAPPY DRAGON RESTAURANT LTD v. THE DIRECTOR OF LANDS

Dr. Lui Tat Hung v. The Director of Lands

LAI Yuet Ngao t/a Hoi Yeung Commercial v. Director of Lands

Fung Kai Yin and Others t/a Hang Lam Tong Sun Yung Seafood and Medicine Co. v. Director of Lands