Chan Ping Sang Johnny and Another v. Secretary for Justice

HCMP 335/2017

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 335 OF 2017

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BETWEEN

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JUDGMENT

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1.By the Originating Summons issued herein on 14 February 2017, the plaintiffs apply under section 45(b)(iii) of the Trustees Ordinance (Cap 29) for a vesting order in respect of the abovementioned Car Park.

2.They so apply in order to perfect their title to the Car Park.

3.The plaintiffs’ title to the Car Park is defective because the Assignment dated 15 October 2004 (“the Assignment”) by which they (as purchasers) acquired the Car Park, though signed by a director of the vendor, a Hong Kong company called Eternal Nice Company Limited (“the Vendor Company”), was affixed with the common seal of another company called Eternal Nice (Pte) Ltd.  The Assignment contained an acknowledgment of receipt of the full purchase price by the Vendor Company. 

4.The plaintiffs are able to find amongst the title deeds and documents of the Car Park a certified copy of the minutes of a board meeting of the Vendor Company on 11 October 2004 resolving, inter alia, to execute the Assignment by affixing its common seal. 

5.That the Vendor Company had affixed the wrong common seal first came to the plaintiffs’ attention when requisition on title was raised as to whether the Assignment had been properly executed by the Vendor Company after the plaintiffs entered into an agreement to sell the Car Park in October 2016.

6.The Vendor Company had in the meantime been dissolved by de-registration on 4 May 2012, following which any residual estate then remaining in the company is deemed to be bona vacantia and passed to the Government.  The Secretary for Justice (“SJ”) is joined as defendant to represent the Government as the person to be divested of the property.

7.The Department of Justice has confirmed that the Government would not assert any claim that the Car Park is bona vacantia or oppose the relief sought by the plaintiffs.

8.Applications for vesting orders as a result of the defective execution of an assignment of property by a company since dissolved are by no means rare occurrences.  Counsel for the plaintiffs has referred to Wong Shuk Ying v Attorney General [1987] HKLR 985; Chung Ka Leung v Secretary for Justice HCMP 4129/1999 (unreported, 4 October 1999); Yip Yat Tim v Secretary for Justice HCMP 3585/2000 (unreported, 11 October 2000); Capital Ltd v Secretary for Justice [2005] 4 HKC 84; Tam Chi Kwong v Secretary for Justice [2007] 2 HKLRD 373; and Fook Tai Investment Co Ltd v Secretary for Justice [2013] 4 HKLRD 102.

9.I am satisfied, on the evidence before me, that the plaintiffs, as purchasers, had acquired, in equity, from the Vendor Company the beneficial interest to the Car Park.  The legal estate would have been effectively passed to them on completion had the Assignment been validly executed by the Vendor Company.  The plaintiffs are plainly entitled to get in the legal estate.

10.I hereby make:

(1) a declaration that the Vendor Company was a trustee of the legal estate of the Car Park for the plaintiffs immediately prior to its dissolution on 4 May 2012;

(2) an order vesting in the plaintiffs as joint tenants all the estate right title benefit and interest the Vendor Company had in the Car Park immediately prior to its dissolution; and

(3) a declaration that the plaintiffs are the legal and beneficial owners of the Car Park.

11.Following Wong Shuk Ying and Yip Yat Tim, the plaintiffs, seeking relief for their own benefit, should pay the SJ’s costs on a trustee basis, which costs has been agreed at HK$10,940.

Mr Jang Sae Pang, instructed by Gallant, for the plaintiffs

Mr Aaron C. L. Lam, Government Counsel of the Department of Justice, for the defendant