YEUNG WAI YING, sole executrix of YOUNG YUK FONG aka YUK FONG YOUNG v. THE REGISTRAR OF COMPANIES

HCMP 433/2025

[2025] HKCFI 3807

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLEANOUS PROCEEDINGS NO 433 OF 2025

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J U D G M E N T

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A.  INTRODUCTION

1.  This is the hearing of the Plaintiff’s Originating Summons issued on 20 March 2025 and amended on 29 April 2025 (“the OS”) seeking the Court’s exercise of its inherent jurisdiction for:

(1)  A declaration that the Agreement for Sale and Purchase dated 7 November 1996 made between Young Yuk Fong aka Yuk Fong Yong (楊育芳) (“the Deceased”) as vendor and Nice Profit Development Limited (美盈發展有限公司) (“Nice Profit”) as purchaser for the sale and purchase of 18 Lots and registered in the Land Registry by memorial no. 377254 (or N377254 or N.377254) (the “1996 SPA”) is no longer registrable under the Land Registration Ordinance; and

(2)  An order to vacate the registration of the 1996 SPA against the 18 Lots at the Land Registry.

B.  BACKGROUND

2.  The Deceased died on 21 July 2018. Probate of his estate (“the Estate”) was granted to the Plaintiff, his daughter, as the sole executrix on 19 September 2019.

3.  The Estate in Hong Kong comprises, amongst others, 20 pieces or parcels of ground situated in North New Territories, 18 Lots of which as set out in the title of the OS (“the 18 Lots”) have been encumbered with the 1996 SPA.

4.  There is another encumbrance registered in the Land Registry against the 18 Lots, ie an Agreement for Sale and Purchase dated 3 November 2017 between the Deceased and Red Lucky Finance Limited (“Red Lucky”) (“2017 SPA”). Solicitors for Red Lucky, informed the Plaintiff that they were willing to proceed with the 2017 SPA if the encumbrance of the 1996 SPA could be removed. The present OS is thus not concerned with the 2017 SPA.

5.  With regard to the 1996 SPA, the purchaser, Nice Profit was incorporated on 28 July 1994 but was dissolved by striking off on 10 February 2006.

6.  By a letter dated 4 June 2024, the Registrar of Companies (“Companies Registrar”) declined to execute a cancellation agreement to cancel the 1996 SPA on behalf of Nice Profit.

7.  The solicitor handling the 1996 SPA for Nice Profit, Mr Ho Sun Kuen, cannot be located from the record of members with or without practising certificates kept by the Law Society of Hong Kong.

8.  The solicitor handling the 1996 SPA for the Deceased, Mr Ho Kwan Hung, is now a partner of Ho & Partners. Ho & Partners informed the Plaintiff’s solicitors that they were unable to locate the relevant file which had been destroyed by terminates.

9.  The Plaintiff and the Companies Registrar have informed the Court, by a joint letter dated 19 May 2025, that the Companies Registrar maintain a neutral stance and would not object to the Plaintiff’s application, with costs to the Companies Registrar. The Companies Registrar’s attendance at this hearing has been excused.

C.  APPLICABLE LAW

10.  The legal principles have been aptly set out in the written submission of Mr So, counsel for the Plaintiff, and I gratefully adopt the same.

11.  Under s.752(1) of the Companies Ordinance (Cap. 622), upon dissolution of a company, every property and right vested in the company immediately before the dissolution is vested in the Government as bona vacantia, and in such a case the Registrar would act on behalf of the Government and should be named as the defendant: Yang Zhenghong v Registrar of Companies HCMP 3115/2013 (unrep, 23 November 2015) at §§2 and 5, G Lam J (as he then was). Such right includes chose in action to enforce a contractual right: Tong Kin Ming & Anor v The Registrar of Companies [2023] HKCFI 1789 at §3, Recorder Eva Sit SC.

12.  At the time when Nice Profit was dissolved on 10 February 2006, the relevant legislation in force was s.292 of the old Companies Ordinance (Cap. 32) (“Cap 32”). There is no material difference between s.292 of Cap 32 and s.752(1) of Cap 622. The principles in the preceding paragraph apply equally.

13.  The Court has inherent jurisdiction to vacate registration or purported registration of any instrument in the Land Registry which does not affect or no longer affects land: Tong Kin Ming at §8(1).

14.  When a sale and purchase agreement ceases to be capable of being specifically performed, or there is no real chance that the Court would grant specific performance, such an agreement would become an instrument that “no longer affects land” and ceases to be registrable at the Land Registry: Tang Kwok Cheung and Tang Fuk Wo as Managers of Tang Tsung Fuk Tso v City Wave Development Limited [2021] HKCFI 2695 at §13, DHCJ Paul Lam SC.

15.  Besides, the defence of laches may apply. In Man Yuet Fong & Ors v Man Kam Cheung Richard [2019] HKCFI 89 at §§44-47, the defendant’s claim was for beneficial interest in funds held by the plaintiff. The Court held that the defendant would be barred by the defence of laches, given the substantial lapse of time (18 years) coupled with the death of an important witness. It was inequitable to enforce the defendant’s claim even if the defendant were to be successful in proving it.

D.  APPLICATION OF THE LEGAL PRINCIPLES

16.  The OS has been properly served on the Companies Registrar, who holds a neutral stance in this application.

17.  The completion date for the 1996 SPA was 31 December 1997. For reasons unknown to the Plaintiff, no completion was carried out. No memorandum of rescission or cancellation agreement with respect to the 1996 SPA have ever been registered at the Land Registry. It is also unknown as to whether it was the Deceased or Nice Profit who was in breach of the 1996 SPA for the non-completion.

18.  Nice Profit has ceased to exist. The Companies Registrar has not expressed any intention to seek specific performance. In any case, Nice Profit or the Companies Registrar would be barred by laches (28 years from date of completion or 19 years since dissolution of Nice Profit) from seeking the equitable remedy. There is no real chance that the Court would grant specific performance. Accordingly, the 1996 SPA has become an instrument that no longer affects the 18 Lots and hence ceases to be registrable.

19.  For these reasons, I make an order in terms of paragraph 1 above.

20.  The Plaintiff is willing to pay costs to the Companies Registrar. I summarily assess such costs and allow them at $32,733. The Plaintiff’s own costs are payable out of the Estate on trustee basis.

21.  I thank Mr So for his assistance.