Read the full judgment text of CACV 263/2010 & CACV 281/2010 on BabelCite. This Court of Appeal judgment was delivered on 30 March 2012 before Yeung VP, Yuen JA, Chu JA.
Property law – New Territories Small House Policy – Private Treaty Grant (PTG) – constructive trust – resulting trust – common intention constructive trust – beneficiary owner of land under concessionary grant – indigenous villager – Ting house – alienation restrictions – Special Condition 5(a) – illegality – public policy – procurement of breach of contract – Tinsley v Milligan doctrine – Letters of Confirmation (轉贈) – Power of Attorney – Will – declaration signed by villager before grant – Declaration B (post-July 1997) – 'jumping the gun' situation – whether the plaintiff was the beneficial owner of Lot 475 in DD177 Lok Lo Ha Village, Shatin by reason of her payment of the premium and construction costs – held, yes, the plaintiff held the property under a common intention constructive trust and/or resulting trust – whether the arrangement was illegal by reason of procurement of breach of contract or false representations – held, no, the tort of procurement was not made out as no contract was in existence when the arrangement was made, and the pre-PTG declaration signed by the deceased contained only true statements – whether the arrangement was in breach of public policy – held, no, applying Li Pui Wan v Wong Mei Yin, as the case amounted to a 'jumping the gun' situation where the government could remove the alienation restriction upon payment of the additional premium – defendant's appeal in CACV 263/2010 dismissed with costs, with amendments to the declarations and order for specific performance to make them subject to the government/lessor's rights under the Conditions of Grant – wasted costs order – non-disclosure of Lands Department Reply by defendant's solicitors (TC Lau & Co) and handling solicitor (Mr Gabriel Leung Jackson-Lipkin) – whether the non-disclosure constituted deliberate concealment or unreasonable omission – held, it was an unreasonable omission warranting a wasted costs order, but the trial judge erred in finding deliberate concealment without a proper investigation – whether there was a causal link between the non-disclosure and the costs of the whole action – held, only a limited causal link as the defendants relied on three defences and illegality was only one of them, affecting only the written and oral submissions – whether costs should be on indemnity or party-and-party basis – held, party-and-party basis per Practice Direction 14.5, paragraph 33 – Solicitors' appeal in CACV 281/2010 allowed in part – Solicitors ordered to pay jointly and severally with the defendant one-third of the costs of the action on a party-and-party basis – plaintiff ordered to pay half of the costs of the Solicitors' appeal.
Legal issues: Whether the trial judge erred in his analysis of the nature of the transaction between the plaintiff and the deceased · Whether the arrangement between the plaintiff and the deceased was illegal and/or in breach of public policy · Whether the wasted costs order was properly made against the Solicitors for non-disclosure of the Lands Department Reply · Whether there was a causal link between the non-disclosure and the costs ordered, and the appropriate basis of assessment
Outcome: In CACV 263/2010, the defendant's appeal against the main judgment was dismissed with costs. In CACV 281/2010, the Solicitors' appeal against the wasted costs order was partially allowed, with the wasted costs order reduced to one-third of the plaintiff's costs on a party-and-party basis.
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