Kowloon Five Districts Meat Merchants Association Ltd v. Secretary for Justice

HCMP 1011/2000

[2023] HKCFI 697

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1011 OF 2000

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DECISION

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1.This application relates to Flat No. 2 on the 8^th Floor of Alhambra Building, Nos. 383, 385, 385A, 385B, 387, 387A, 387B, 389, 389A-389C Nathan Road & Nos. 15-17 Kansu Street, Kowloon (the “Property”). By Originating Summons of 24 February 2000, amended and refiled on 1 November 2022, the Applicant seeks:

(a)  a declaration that the Applicant is the sole beneficial owner of the Property;

(b)  a declaration that Kowloon Meat Trade Employers General Association (“KMTEGA”) held the Property on trust for the Applicant at the time of KMTEGA’s dissolution on 16 December 1986; and

(c)  an order that the legal estate and all the right, title, benefit and interest held by KMTEGA in the Property be vested in the Applicant.

2.For the reasons set out below, I am satisfied that the Applicant has proved its case for the declaration set out in §1(b) above:

(a)  The agreement for the purchase of the Property was first entered into in the name of Wong Shum Kee, Lee For Chew, Shiu Kam Shau and Wong Wui Chun (the “Trustees”) in February 1960; 

(b)  The Property was assigned to the Trustees via Assignment dated 1 March 1963 (Memorial No. UB392188);

(c)  I call them the Trustees as they by a written Declaration of Trust of the same date declared themselves to be holding the Property as trustees for KMTEGA, and that the purchase price was paid by the latter;

(d)  On 1 April 1962, the Trade Unions Registration Ordinance Cap 332 (the “TURO”) came into operation.  Section 68(4) thereof stipulated relevantly that:

“If any unincorporated association, being a trade union within the meaning of this Ordinance, shall become registered thereunder, all of the property and assets of what description soever belonging to the members of such association by virtue of membership thereof or vested in trustees for the members of such association shall become vested in the registered trade union upon registration together with all rights and liabilities …”

(e)  Whilst the exact date is not clear, it is apparent that KMTEGA became registered under TURO sometime before 9 January 1968, as I will explain;

(f)  By an Assignment dated 9 January 1968 (Memorial No. UB611054), the Trustees assigned the Property to KMTEGA.  According to the recital therein, KMTEGA had been registered under TURO, and the assignment was executed to record the vesting of the Property upon KMTEGA effected by s 68(4) of the TURO;

(g)  On 13 November 1986, KMTEGA during a general meeting resolved to dissolve itself and to transfer all its assets to the Applicant (the “1986 Resolution”).  The 1986 Resolution was in writing and signed by the attending members;

(h)  KMTEGA on 14 November 1986 applied for the cancellation of its registration;

(i)  By letter of 1 December 1986, the Registrar of Trade Unions informed KMTEGA that its registration was cancelled on that date under s 10(1)(a) of TURO, and KMTEGA ceased to be a registered trade union as from that date;

(j)  Under s 14(2)(a) read together with ss 10(1)(a) and 12(2) of TURO, if there is no appeal upon cancellation under s 10(1)(a), the cancellation shall take effect upon expiration of 14 days after the cancellation;

(k)  There had been no appeal;

(l)  The cancellation of the registration of KMTEGA therefore took effect on 16 December 1986;

(m)  In the meantime, the Applicant was incorporated on 1 December 1986. According to its Memorandum of Association, one of its objects is “To take over the whole management, assets and liabilities of [KMTEGA]”;

(n)  The title documents of the Property have been handed to the Applicant, and been kept by it since;

(o)  Since incorporation, the Applicant has been occupying and using the Property as its office;

(p)  Despite the above, the Property has remained, the Applicant says by inadvertent mistake which I accept, registered in the name of KMTEGA.

3.I have considered the authorities cited by Mr Mak to me, which include Re Strathblaine Estates Ltd [1948] Ch 228 and Clariant AG & Clariant Plastics & Coatings (Ireland) Limited [2020] IEHC 211.  On the facts recited above, I am satisfied that an express trust has been set up with KMTEGA holding the Property as trustee for the Applicant.  Section 5(1)(b) of the Conveyancing and Property Ordinance Cap 219 was satisfied by virtue of the existence of the 1986 Resolution. 

4.In any event, having considered Lewin on Trusts, 20^th Ed §10-062 and Chan Sang v Chan Kwok [2015] 3 HKLRD 131 at §38 which Mr Mak has also cited, I am satisfied that the Applicant has proved the existence of a common intention constructive trust over the Property in its favour (in respect of which Section 5(1)(b) of the Conveyancing and Property Ordinance has no application).

5.In respect of the vesting order sought:

(a)  S 13 of the TURO stipulated that:

“The registration of a trade union shall render it a body corporate by the name under which it is registered, and … with perpetual succession and with power to hold property movable or immovable …”

(b)  S 14(1) of the TURO stipulated that, save certain exceptions not applicable here, upon cancellation of registration, the trade union concerns shall cease to exist as a corporate body and shall forthwith be dissolved;

(c)  I am satisfied that s 45 of the Trustee Ordinance Cap 29 applies, in that KMTEGA having been a body corporate has been dissolved. 

6.The Department of Justice, which may be interested due to the possibility of bona vacantia, has indicated that it will adopt a neutral stance to the application, and has sought leave from this Court to be excused from this hearing, which I on 5 January 2023 granted.

7.Despite my views above, I cannot on the evidence reach any view as to whether there exists any rival claim otherwise than from KMTEGA which may bear upon the Applicant’s beneficial interest in the Property.  In my view, the declaration set out in §1(a) above is a wide and sweeping one which cannot not be made unless the chain of title of the Property has been comprehensively looked in a properly constituted action with the necessary parties before the Court.  I am not prepared to make it.  Towards the end of the hearing, Mr Mak fairly accepted the above and abandoned §1(a) above. 

8.For the reasons set out above, I granted the declaration and the vesting order set out respectively in §1(b) and §1(c) above.  I decline to make the declaration set out in §1(a).

9.I make no order as to costs.