CHAMPHON INDUSTRIAL LTD v. HIGHT PROJECTS INDUSTRIAL LTD

[A power of attorney which appears to have been duly executed by the donor of the power may for conveyancing purposes be presumed to have been validly executed, particularly if its execution has been attested by a witness or witnesses. There is no need for the donor's execution of the power to have been authenticated or certified by a notary public, even if the power was executed abroad]

1992, No. MP3631

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

MISCELLANEOUS PROCEEDINGS

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J U D G M E N T

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1. This is a vendor and purchaser summons. It concerns Flat A, 2/F Cleveland Mansion, 5 and 7 Cleveland Street, Hong Kong, which the plaintiff ("the vendor") agreed to sell to the defendant ("the purchaser") by a sale and purchase agreement dated 28th August 1992. The agreed price was HK$3,970,000.

2. The title of the vendor depends on an instrument executed by the donee of a power of attorney dated 23rd December 1983, the donor being at the time resident in the Province of Quebec in Canada (a Commonwealth country). The purchaser has objected to the title offered, suggesting that the power of attorney was void and of no effect.

3. The power of attorney is expressed to have been executed by the donor under seal. The donor's execution of the power of attorney is attested by two witnesses, each of whom describes himself as an "avocate". The objection is that the execution of the power of attorney by the donor should have been attested by a notary public. The purchaser relies for this objection on the provisions of a circular No 253/90 issued by the Law Society on 24th December 1990 ("the circular"). The subject of the circular is described as "Conveyancing Practice - Attestation Of Conveyancing Documents Executed Abroad For Use In Hong Kong".

4. So far as is material, the circular provides as follows : -

"The Council [of the Law Society] wishes to remind members that a conveyancing document for use in Hong Kong should be executed abroad in the following manner, namely ... where in a Commonwealth country, the document should be attested by a Notary Public practising in that country ..."

5. I was told from the bar'that there is no such officer as a notary public in the Province of Quebec; since it is not necessary for me to do so, I express no view as to whether this is or is not correct, for in any event, in my judgment, the purchaser's objection is not well founded.

6. I expressed this opinion at the conclusion of the hearing before me on 16th December 1992, and then indicated that I would be prepared to make an order containing an appropriate declaration. But since it appeared to me that there was some confusion in the minds of practitioners on the subject of the execution of powers of attorney by persons resident abroad, and that the point might be of some general importance, I said that I would take time to reduce my judgment into writing. This is that judgment.

7. The law as to attestation of deeds (including powers of attorney under seal) is clear; at common law no attestation is required in order to prove due execution. It is desirable, and a wise practice, to have the execution of a power of attorney witnessed, preferably by two witnesses. But except where for some particular purpose a statute requires it, this is not necessary. (An example of a statutory requirement is to be found in this very field, in s 2(2) of the Powers of Attorney Ordinance, Cap 31. In that sub-section there is to be found a provision to the effect that where a power of attorney is signed and sealed, not by the donor of the power himself, but by some other person by direction and in the presence of the donor of the power, two other persons shall be present as witnesses and shall attest. the instrument.)

8. Now, in the absence of any cause for suspicion, it should be presumed by conveyancing practitioners that a power of attorney, and indeed any document of title, has been executed or signed as appears on the face of the document. The conveyancer should act on the presumption that everything has been rightly done, until the contrary is shown. And this presumption is greatly strepgthened by the fact (and it will usually be the fact) of the title deeds being in the custody of the possessors of the land to which the deeds relate. (For all these propositions, see Williams on Vendor and Purchaser, 4th Edition, at pp. 158, 159; and see also section 23 of the Conveyancing and Property Ordinance, Cap 217.)

9. There would have been no valid objection to the execution of the power of attorney by the donor of the power here even if it had not been attested at all. It follows that its attestation by two witnesses is no reason to doubt the validity of its execution. On the contrary, it is strong evidence of the validity of its execution.

10. The suggestion made in the circular to which I have referred, i.e. that a power of attorney executed in a Commonwealth country "should be attested by a Notary Public" is no doubt a sensible one. But it is my impression that practitioners have read (and, perhaps, may have been intended to read) "should" as meaning "must". If that impression is correct, the circular is misleading.

11. The suggestion may be based on a misunderstanding of the scope, purpose and effect of the Hague Convention of 5th October 1961, abolishing the requirement of legalisation for foreign public documents. Under this Convention (to which an unpacticularized reference is made in the circular) a simplified procedure is made available for the certification of (among other things) notarial authentications of signatures to foreign public documents. As between States signatory to the Convention, the requirement for diplomatic or consular legalization in this connection has now been abolished. It is certainly not the effect of the Convention that a "conveyancing document" which, wherever executed, does not have to be attested' at all, but which is in fact attested before a witness or witnesses, will be invalid for want of authentication or certification by a notary public simply because it was executed abroad.

12. In the light of this judgment, the Law Society may wish to reconsider the contents of the circular.

13. I should add that, by agreement, I made no order as to costs when disposing of these proceedings.