Errant-tenant cases in decline

PUBLISHED : Wednesday, 09 April, 2008, 12:00am
UPDATED : Wednesday, 09 April, 2008, 12:00am

Disputes drag on if occupants refuse to obey court rulings

The number of flat owners filing complaints with the Lands Tribunal about tenants who fail to pay their rent is on the decline, official data showed, although some landlords remain locked in long-running disputes with errant occupants of their properties.

According to the Lands Tribunal, the number of tenancy cases filed last year dropped to 4,333 from 4,669 in 2006 and 5,144 in 2005.

The Hong Kong Owners Club, which helps property owners settle leasing disputes with tenants, receives more than 100 reports of delinquent tenants on average every year, according to chairman Shea Hing-wan.

'Most of the landlords come to us as a last resort and the majority of our cases involve properties leased for a monthly rent of less than HK$20,000,' Mr Shea said.

He said lengthy settlement procedures generally arose where landlords had little or no knowledge of legal procedures.

'Some come to us when they are already in a panic situation and cannot even explain clearly what has happened as their cases have dragged on for so many years,' Mr Shea said.

Although most landlords eventually managed to recover their properties from tenants in default of their leases, fewer than 10 to 20 per cent got back unpaid rent, he said.

The association is now handling a case involving an owner who has battled for 10 years to recover a property from a tenant who has refused to pay rent during that period.

The owner, Lee Hop-bui, rented out a 100 square foot shop plus an unauthorised tin-roof extension area of 50 square feet adjacent to the unit for about HK$6,000 a month to the tenant in 1989. The tenant ran an air-conditioner repair business in the premises.

From 1998, the tenant began defaulting on rental payments, prompting Mr Lee to sue for the outstanding rent at the Lands Tribunal and the District Court. He secured an order to repossess the shop in 2001.

But Mr Lee said the tenant refused to move and has continued to unlawfully occupy the unit until now.

Last month the Hong Kong Owners Club also helped another flat owner, Chan Yin-kwan, to recover her flat after she complained that her tenant owed her more than four years' rent, and even damaged the property before leaving the unit.

Ms Chan bought her flat in 1999 and rented it for HK$3,800 per month in April 2003. She hired two law firms to sue the tenant, claiming almost HK$200,000 in outstanding rent. In 2006, she filed a case with the Lands Tribunal, which ruled that the tenant should pay the HK$186,200 owed to Ms Chan, plus District Court costs of HK$1,000.

Ms Chan recovered her flat, but the tenant not only refused to pay the outstanding rent but also damaged her unit before he vacated it.

Last month Ms Chan lodged a complaint with the Legislative Council's complaint division, which assists councillors to deal with cases seeking to redress grievances and bring to light the need for improvement in government policies and procedures where appropriate.

She met two legislative councillors - James To Kun-sun and Tam Yiu-chung - and asked the government to amend the legislation to impose stricter penalties on unscrupulous tenants.

Mr To said the number of such complaints was on the decline, adding that Ms Chan's complaint was an extreme example.

Mr Tam said it would be time-consuming to amend legislation to help landlords.

'It is more efficient for landlords to check with the property agents who have a list of unscrupulous tenants before they sign the leasing contracts,' he said.

Mr To said a 'case' conference would be held next month to further study Ms Chan's complaint to see what could be done to improve the existing system.

Representatives of the Housing Department, Rating and Valuation Department, Legal Aid Department and Hong Kong Police Force have been invited to attend the conference.