CARNIVAL LTD v. THE PERSONAL REPRESENTATIVE OF HO YAN (何仁) ALSO KNOWN AS HO A YAN (何亞仁), DECEASED

HCMP 1865/2023

[2025] HKCFI 5423

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1865 OF 2023

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D E C I S I O N

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INTRODUCTION

1.  The Plaintiff is the registered owner of Lot No.5 S.A ss.6 and the extension thereto, Lot No.5 S.B ss.3, Lot No.5 S.A ss.7, Lot No.5 S.A ss.8, Lot No.5 S.B ss.2, Lot No.5 S.B ss.4 and Lot No.5 S.B ss.5 all in D.D.231, Chuk Kok, Sai Kung, New Territories (“the Lots”). They can be categorized as follows:

(1)  3 subsections under Lot No.5 S.A, namely (1) ss.6 and the extension thereto; (2) ss.7; and (3) ss.8.

(2)  4 subsections under Lot No.5 S.B, namely (1) ss.2, (2) ss.3, (3) ss.4, and (4) ss.5.

2.  On 24 October 2023, the Plaintiff took out the present Originating Summons (“OS”) seeks the following declarations about the title of Lots:

(1)  the title of the Lots has been vested in the Plaintiff;

(2)  further and/or alternatively, the Plaintiff has and/or has shown a good title to the Lots despite the requisition as defined in paragraph 16 of the supporting affirmation of Bernard Lam (the Plaintiff’s director) (“Requisition”);

(3)  further and/or alternatively, there is no real risk of a title defect/problem and/or there is no real risk that a third party might assert some right over the Lots; and

(4)  further and/or alternatively, any risk/possibility of impeachment of title arising from the Requisition is remote, theoretical and/or fanciful.

3.  The 1^st Defendant is the Personal Representative of Ho Yan also known as Ho A Yan, deceased (“Ho Yan”). Ho Yan is one of the three government lessees under the Block Crown Lease. The other two government lessees are Ho Tai Tsing and Ho Tai Sau.

4.  By the Order of Master Phoebe Man dated 26 February 2025, the Official Solicitor was appointed for the limited purpose of accepting service of the Originating Summons on behalf of the 1^st Defendant.

5.  The Requisition concerns one document, namely the Division of Property dated 17 February 1921 (SK48526) (“the Division of Property”). This is over 100 years from now.

6.  In gist, the Requisition raises the concern that Ho Yan (despite being one of the government lessees) was not a party to the Division of Property.

7.  The single issue for this Court is whether the fact that Ho Yan was not a party to the Division of the Property constitutes a title defect.

MATERIAL FACTS

8.  In about 2012, the Plaintiff has made an application for in-situ land exchange (“Land Exchange”) with the Government in respect of the Lots.

9.  One key issue that has prevented the Land Exchange application from proceeding forward is the Requisition which is said to constitute a “broken chain of ownership.”

10.  The Plaintiff has offered to give indemnity to the Government in respect of the Land Exchange that the Plaintiff shall indemnify both the Lands Department and the Government from and against all actions, proceedings, costs, claims and demands whatsoever arising out of or in connection with the surrender of the Lots. Such offer was not accepted.

11.  The Government maintains that the Plaintiff should obtain a court order or declaration to confirm that the title of the Lots has been vested in the Plaintiff before considering whether to proceed with the Plaintiff’s Land Exchange application.

12.  Therefore, the Plaintiff commences the present proceedings for the declaration.

THE APPLICABLE LEGAL PRINCIPLES

13.  The OS is, in essence, seeking a declaration of good title to the Lots, which is in substance the same as those commonly sought in a sale and purchase transaction. Hence, I agree that the legal principles concerning good title that the Court has commonly applied in the context of a sale and purchase transaction are applicable by analogy in the present case.

14.  Such relevant legal principles have been succinctly summarized in Hui Kwok Hau v Hui Mimie Mei Mui [2023] HKCFI 1654 at §18 as follows:

“18. There is no dispute as to the applicable principles, which were summarised in Asia Rich Incorporation Limited v Chin Hung [2019] HKCFI 2187 at [19] to [21]. For present purposes, the following are relevant.

18.1 The test as to whether “good title” has been given or shown by the vendor or boils down to whether there is a real risk that a third party might assert some right over the property, thereby encumbering it or defeating the title altogether. (See De Monsa Investments Ltd v Whole Win Management Fund Ltd (2013) 16 HKCFAR 419 at [109].)

18.2 A good title does not mean a perfect title, free from every possible blemish. The question of whether good title has been shown by a vendor must be approached from the standpoint of a willing purchaser and a willing vendor, both possessed of reasonably robust common sense, both intending to see the transaction through to completion in terms of their own bargain. (See Mexon Holdings Ltd v Silver Bay International Ltd (2000) 3 HKCFAR 109 at 117D-E.)

18.3 The court should best be guided by commercial reality as to whether there is any real risk of problems in title. It is not to be troubled by the absence of an absolute risk-free assurance, nor unduly hampered by strict legal proof in matters requisitioned. Conveyancing practice must be geared to uphold bargains. (See Jumbo Gold Investment Ltd v Yuen Cheong Leung [1999] 3 HKLRD 825 at 833F-G (per Liu JA, dissenting; upheld on appeal to the Court of Final Appeal.))

18.4 What is required to prove title in a given case must depend on the specific facts and circumstances and one must apply common sense.

18.5 If the facts and circumstances of a case are so compelling to the mind of the court that the court concludes beyond reasonable doubt that the purchaser will not be at risk of a successful assertion against him of the incumbrance, the court should declare in favour of a good title shown. (See MEPC Ltd v Christian-Edwards and others [1981] AC 205 at 220C.)

18.6 If the risk is, for all practical purposes, illusory, the court can and should be prepared to ignore it and accordingly dismiss any objection to title founded upon it. (See Kan Wing Yau v Hong Kong Housing Society [1988] 2 HKLR 187 at 193E-F.)” (emphasis added)

ANALYSIS AND DETERMINATION

15.  I refer to the helpful and comprehensive submissions by Mr Chan for the Plaintiff. I am happy to make an order that the title of the Lots be vested in the Plaintiff. I am also prepared to make a declaration that the Plaintiff has and/or has shown a good title to the Lots despite the Requisition.

16.  First, I agree that similar to Ngai Kin Lit v To Chai Fook [1997] 3 HKC 749, there is no real risk of a title defect/problem and/or there is no real risk that a third party might assert some right over the Lots by reason of the 1^st Defendant’s multiple dealings of Lot No. 5 in D.D.231 after the Division of Property dated 17 February 1921.

17.  In particular, after the Division of Property, the 1^st Defendant was personally involved in five transactions involving Lot No. 5 in D.D.231 which premised on the validity of the Division of Property.

18.  The first transaction was a transfer dated 22 October 1923 (Memorial No. SK57030) (“the Transfer”).

(a)  According to the Schedule to the Memorial of the Division of Property, Lot No. 5 S.A. was thereby vested in Ho Tai Shau.

(b)  In the Transfer dated 22 October 1923, Ho Tai Shau as transferor vested inter alia 1/2 of Lot No. 5 S.A. in Ho Yan as transferee.

(c)  The 1^st Defendant signed on the Memorial of the Transfer, thereby unequivocally acknowledging the validity of the Division of Property -- for otherwise, Ho Tai Shau would not have been able to make this transfer of 1/2 of Lot No. 5 S.A. to D1.

(d)  According to the Memorial of the Transfer, it was “certified as correct” by the District Officer.

(e)  From the land search record, Ho Tai Shau’s other 1/2 of Lot No. 5 S.A. was later passed to Ho Fat by Succession to Property dated 11 June 1960 (Memorial SK70563) (“the Succession to Property”). Since then, the 1^st Defendant and Ho Fat became co-owners of Lot No. 5 S.A.

19.  The second transaction was a Conveyance on Sale dated 27 September 1960 (Memorial No. SK71069) (“27.9.1960 Conveyance on Sale”).

(a)  Similarly, this transaction involved Lot No. 5 S.A.

(b)  This time, the 1^st Defendant and Ho Fat as co-owners of Lot No. 5 S.A. sold a portion of Lot No. 5 S.A. (namely Lot No. 5 ss1) to a purchaser named Wan Sik by the 27.9.1960 Conveyance on Sale.

(c)  The 1^st Defendant signed on both the Memorial of the 27.9.1960 Conveyance on Sale and the accompanying plan, thereby unequivocally acknowledging the validity of the Division of Property -- for otherwise, Ho Tai Shau would not have been able to vest 1/2 of Lot No. 5 S.A. in Ho Fat via the Succession to Property or the other 1/2 in the 1^st Defendant via the Transfer.

(d)  According to the Memorial of the 27.9.1960 Conveyance on Sale, it was “certified as correct” by the assistant land officer.

20.  The third transaction was a Conveyance on Sale dated 14 December 1960 (Memorial No. SK71438) (“14.12.1960 Conveyance on Sale”).

(a)  Similarly, this transaction involved Lot No. 5 S.A.

(b)  This time, the 1^st Defendant and Ho Fat as co-owners of Lot No. 5 S.A. sold another portion of Lot No. 5 S.A. (namely Lot No. 5 ss2) to a purchaser named Yau Shing by the 14.12.1960 Conveyance on Sale.

(c)  The 1^st Defendant similarly signed on both the Memorial of the 14.12.1960 Conveyance on Sale and the accompanying plan, thereby unequivocally acknowledging the validity of the Division of Property -- for otherwise, Ho Tai Shau would not have been able to vest 1/2 of Lot No. 5 S.A. in Ho Fat via the Succession to Property or the other 1/2 in the 1^st Defendant via the Transfer.

(d)  According to the Memorial of the 14.12.1960 Conveyance on Sale, it was “certified as correct” by the assistant land officer.

21.  The fourth transaction was a Lease dated 30 May 1966 (Memorial No. SK80527) (“the Lease”).

(a)  This transaction involved inter alia Lot No. 5 S.B. According to the Schedule to the Memorial of the Division of Property, Lot No. 5 S.B. was thereby vested in Ho Tai Tsing.

(b)  By the Lease, Ho Tai Tsing as one of the lessors, let Lot No. 5 S.B. to one Chan Mo Yin.

(c)  The 1^st Defendant signed on the Lease as a witness thereof, thereby unequivocally acknowledging the validity of the Division of Property -- for otherwise, Ho Tai Tsing would not have been able to make the Lease.

(d)  According to the Memorial of the Lease, it was “certified as correct” by the assistant land officer.

22.  The fifth transaction was a Conveyance on Sale dated 5 January 1973 (Memorial No. SK85779) (“5.1.1973 Conveyance on Sale”).

(a)  Similarly, this transaction involved inter alia Lot No. 5 S.A.

(b)  This time, the 1^st Defendant and Ho Fat as co-owners of Lot No. 5 S.A. sold another portion of Lot No. 5 S.A. (namely Lot No. 5 RP) to a purchaser named Liu Koon Sing by the 5.1.1973 Conveyance on Sale.

(c)  The 1^st Defendant signed on the Memorial of the 6.1.1960 Conveyance on Sale, thereby unequivocally acknowledging the validity of the Division of Property -- for otherwise, Ho Tai Shau would not have been able to vest 1/2 of Lot No. 5 S.A. in Ho Fat via the Succession to Property or the other 1/2 in D1 via the Transfer.

(d)  According to the Memorial of the 6.1.1960 Conveyance on Sale, it was “certified as correct” by the assistant land officer.

23.  I agree with the observations of Le Pichon J (as she then was) in Ngai Kin Lit v To Chai Fook (supra) that since there were subsequent dealings that confirmed the division of property in that case, there was absolutely no risk of an alleged title defect. One has be realistic when assessing the relevant risk in question.

24.  Le Pichon J (as she then was) at p.752H-I, ruled that there was “absolutely no risk” that Tse Nam Mau might not be the owner of the land or that the vendor’s title was defective by reason that after the Division of Property, he had dealt with the lots vested in him as owner-

“… in fact after the date of the division of property, Tse Nam Mau had dealt with the several lots vested in him by that instrument as owner. There is evidence of a mortgage and subsequent redemption affecting, inter alia, the land as well as a sale in 1930 of other land vested in him by the division of property. Having regard to these matters, there is absolutely no risk that anyone could now come along and assert that Tse Nam Mau was not the owner of the land or that the vendor’s title is defective.”

25.  Similarly, in the present case, after the Division of Property, the 1^st Defendant had dealt with Lot No. 5 S.A. which was vested in Ho Tai Shau and then to the 1^st Defendant (as to 1/2 share) by that instrument. The 1^st Defendant had also signed (as a witness) on the Lease concerning Lot No. 5 S.B., which was vested in Ho Tai Tsing by that instrument.

26.  Secondly, the Division of Property has been made and registered with the Land Registry for over 100 years. The Plaintiff has affirmed that to its director’s knowledge and information, no one has disputed the Plaintiff’s title to the Lots. In Lau Kam Shing v Cheung Chuen (HCMP 504/2011, CFI, 1 December 2011), it concerned a requisition of broken chain of title (paras 5 and 7) arising from the absence of any document showing how the assignors (who assigned as trustees in a Conveyance on sale in 1947) became trustee of the Property and whether they had the right to convey the Property. Deputy High Court Judge Houghton SC held at §§18-19 that

“18. … I do not believe there is any such risk as might be described as being more than hypothetical. This is in part because of the long lapse of time, without any issue arising since the relevant facts first came into being. The prospects of a rival title claim emerging from either set of circumstances, much less one with prospects of success seems remote.

19. Moreover I accept the submissions of Mr. Yan in regard to the 1st requisition that there is an inference to be drawn from the memorials in 1947 and 1948 that title had been shown in the making of these transactions.” (Emphasis added.)

27.  In the present case, according to the land search records, various portions of the Lots had been assigned/devolved to successors-in-titles by multiple transactions before the Plaintiff came to the registered owners thereof.

28.  Despite all these devolutions that ultimately led to the title of the Lots being vested in the Plaintiff’s name on 19 June 2009, no one has ever come forth to challenge the validity of the Division of Property.

29.  I agree that the objective facts show that the Division of Property (which was made over 100 years ago on 17 February 1921) has never been challenged for over 100 years despite the multiple devolutions of title. Such is a piece of unmistakable evidence that the risk of anyone (including inter alia the 1^st Defendant) coming forth and disputing the validity of the Division of Property is remote, theoretical and fanciful.

30.  Thirdly, any possible cause of action of the 1^st Defendant seeking to recover the Lots by challenging the validity of the Division of Property would have been way over 20 or 12 years and thus long time-barred under ss. 7 and 17 Limitation Ordinance and hence, any challenge would be time-barred.

31.  In Wong Tat Shun v Tang Shiu Man [2013] HKCU 2477 (unreported, DCMP 790/2012, 25 Oct 2013, per HHJ Andrew Li (as he then was)), which was an application by the intended purchaser for declaration of a good title in regard to a piece of land in the New Territories despite the lack of title deed or document showing how the title of government lessee, one Tang Yu Lung was conveyed to anyone before the relevant parties could enter into the Division of Property dated 24 April 1912 Memorial No YL20240 for vesting the Land unto one Tang Loi Fuk and from whom the respondent, Tang Shiu Man (the respondent) succeeded the Land.

32.  In §§30-34, the learned judge held that

“[30] Further, the applicant submits that under section 7 of Limitation Ordinance, Cap 347 ("LO") no action shall be brought by any other person to recover any land after the expiration of 12 years from the date on which the right of action accrued to him or, if it first accrued to some person through whom he claims, to that person.

[31] Under section 17 of LO, "subject to the provision of section 10, at the expiration of the period prescribed by this Ordinance for any person to bring an action to recover land ……., the title of that person to the land shall be extinguished."

[32] I also accept the applicant’s submission on this that whoever considers they might have a claim on the title of the Land, they would be badly out of time as, for over 100 years, the title of the government lessee and his successors in title had not been challenged. In my view, it is unlikely that anyone would able to succeed now.

[33] … [Quoting from the Division of Property]

[34] Judging from the above, the lands were divided among 4 fongs (四房) of family members… any possible beneficial owner (it is doubtful if any existed at all) are also not entitled to take any legal action to claim any interest in the Land after lapse of over a century since accrual of their right of action (24 April 1912 being the date of registration of such Division of Property) due to the time limit stipulated under section 7 of LO. Their title, if any, to the Land would have been extinguished under section 17 of LO.”

33.  In this case, the Division of Property has been made and registered with the Land Registry for over 100 years. I agree that any possible cause of action of the 1^st Defendant seeking to recover the Lots by challenging the validity of the Division of Property would have been time-barred.

DISPOSITION

34.  For all the reasons stated above, I will make an order that:

(1)  The title of the Lots has been vested in the Plaintiff; and

(2)  A Declaration that the Plaintiff has shown a good title to the Lots despite the Requisition.

35.  Finally, I would like to thank Mr Chan for his very helpful assistance.