HA CHI KUEN v. LAU BOND INTERNATIONAL LTD (formerly known as INSTECH INTERNATIONAL LTD)

DCMP 804/2025

[2025] HKDC 2124

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO 804 OF 2025

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REASONS FOR JUDGMENT

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1.  By originating summons issued on 7 February 2025, the plaintiff applied for an order to remove the defendant’s attempted registration of a sealed copy of the Amended Writ of Summons issued in DCCJ 5030/2019 (“Amended Writ”) as a lis pendens at the Land Registry in relation to Shop T101 on the Third Floor, The Capital of the Retail Area, Park Hotel, Nos 61-65 Chatnam Road South, Kowloon, Hong Kong (“Subject Property”).

2.  The plaintiff’s application was heard before me on 25 September 2025. At the conclusion of the hearing, I granted the plaintiff’s application and gave oral reasons for doing so. These are my written reasons for my judgment.

DCCJ 5030/2019

3.  DCCJ 5030/2019 was an action brought by the defendant herein (“LB”) against Ha Chi Kut (“Kut”), Chau Ching Yee Greenie (“Chau”), Own Image Co Ltd (“Own Image”) and Choi Nam Shan (“Choi”).

4.  The underlying dispute in DCCJ 5030/2019 arose out of a tenancy agreement titled “店舖借用合約”dated 28 March 2019 (“TA”) under which Own Image as “lender” （“出借人”）purportedly let the Subject Property to LB[1] as “borrower”（“借用人”）for the term of 1 year commencing on 5 April 2019 at the monthly rent of HKD 4,200.

5.  Despite having executed the TA as “lender”, Own Image has never been a registered owner of the Subject Property. It was D1 which became its registered owner on 15 August 2013, who held the same under her sole name until 23 July 2018. D1 then assigned the Subject Property to her sister, the plaintiff herein (“Kuen”), who has held it under her sole name since.

6.  It is LB’s pleaded case in DCCJ 5030/2019, among other things, that:

6.1.  Kut was said to be the landlord of the Subject Property when the TA was entered into;

6.2.  Chau was Kut’s agent to handle the renting affairs of the Subject Property and was the sole director of Own Image;

6.3.  Own Image was Kut’s agent company to handle the renting affairs of the Subject Property;

6.4.  Choi was the ex-property manager of the Capital Shopping Mall (“Mall”) who represented that he was authorized by Kut to rent out the Subject Property;

6.5.  On or about 25 March 2019, Mr Lau Wai Hung of LB (“Mr Lau”) was attracted by an advertisement offering to let the shops of the Mall to potential tenants. The advertisement contained the contact number of Chau of Own Image;

6.6.  Relying on the advertisement, Mr Lau contacted Chau and Chau represented to LB that she and Own Image were authorized by Kut to rent out the Subject Property and manage the renting affairs thereof;

6.7.  Further, Chau represented to LB that, after Own Image received the deposit and advanced rent for the Subject Property, she would then cause Own Image to issue cheques for rental payment and deposit these cheques into Kut’s personal bank account;

6.8.  Since LB was interested in renting the Subject Property, and relying on the said representations, LB entered into the TA and paid Own Image the following amounts: (i) HKD 8,400 as deposit; (ii) HKD 25,200 as the first 6 months’ rent; and (iii) HKD 25,200 (by a post-dated cheque) for the next 6 months’ rent of the rental term;

6.9.  After receiving these amounts, Chau caused Own Image to pay part of these amounts to Kut while Own Image retained the rest of the money;

6.10.  On 5 April 2019, LB moved into the Subject Property, after having conducted a series of promotional activities to prepare the opening of its business thereat;

6.11.  At about 7:00pm on 9 April 2019, Choi together with other management staff of the Mall alleged that LB was illegally using the Subject Property and tried to evict LB on the spot;

6.12.  There, Choi also alleged that he was authorized to handle the renting affairs of the Subject Property for Kut by a power of attorney which was in fact revoked and invalid;

6.13.  Since Kut was the false landlord of the Subject Property and Kuen did not authorize, permit or allow Own Image to rent out the Subject Property as her agent, LB had laboured under a misrepresentation that Own Image did have such authority when entering into the TA;

6.14.  Such misrepresentation was made by Kut, Chau, Own Image and Choi fraudulently, as “a gang of people”, knowing that such representation was false or recklessly not caring whether it was true or false;

6.15.  Even if such representation was not made fraudulently, LB will rely on Section 2 of the Misrepresentation Ordinance for relief; and

6.16.  It follows that the consideration for the payment of the deposit and advanced rent by LB has wholly failed as LB could not move into the Subject Property to enjoy the property.

7.  Accordingly, LB seeks the following relief:

“(a) a declaration that the [TA] be rescinded and/or is null and void;

(b) refund and/or payment to [LB] a total sum of $58,800 paid to [Kut], [Chau] and [Own Image] as pleaded under Paragraphs 10-14 as money hand and received;

(c) refund and/or payment to [LB] a total sum of $150,000 as money expended by [LB] on the renovation of the [Subject Property] and promotional activities of the opening of the business on internet;

(d) expenditure for the decoration of the [Subject Property];

(e) damages;

(f) further or alternatively, damages for fraudulent misrepresentation;

(g) alternatively, damages for misrepresentation pursuant to Section 2 of the Misrepresentation Ordinance (Cap 284);

(h) costs;

(i) interest;

(j) further or any other relief.”

The Present Application

8.  Against the above background, the plaintiff’s application was mounted on the footing that the Amended Writ did not qualify for registration as a lis pendens pursuant to sections 1A and 2(1) of the Land Registration Ordinance. As the plaintiff submitted, this is because:

8.1.  First, the claim in DCCJ 5030/2019 does not “relate to land or any interest in or charge on land”; and

8.2.  Second, the claim does not seek “something to be done” with the Subject Property.

9.  Hence, the plaintiff invoked the Court’s power under section 19 of the Land Registration Ordinance to order that the attempted registration of the Amended Writ be vacated on the basis that the litigation is not prosecuted bona fide, or for other good cause shown.

10.  The plaintiff’s application was opposed by LB. Mr Lau, the director of LB appearing at the hearing, submitted that the Amended Writ was properly registered. At the hearing, Mr Lau put forward five succinct reasons in support of the LB’s position:

10.1. First, the underlying tenancy agreement concerned in DDCJ 5030/2019 was duly stamped;

10.2. Second, Kuen could not inherit properties under the estate of Kut under the relevant requirements under Chinese law;

10.3. Third, the underlying dispute in DCCJ 5030/2019 involves criminal elements;

10.4. Fourth, as regards the attempted registration of the Amended Writ itself, when Kut sold the Subject Property to Kuen in 2018, both of them should know that the Subject Property was being let out;

10.5. Fifth, it was improper for Kuen to dispose of the Subject Property before LB received compensation in DCCJ 5030/2019. Hence, LB wrote to the Land Registry and instructed lawyers to register the Amended Writ against the Subject Property.

11.  According to Mr Lau, when he sought to register the Amended Writ, the Land Registry informed him that he could not register it unless a specific order is made by the Court. When I asked Mr Lau at the hearing what his view was regarding this, Mr Lau appeared to accept that the Amended Writ could not be registered.

12.  But even putting aside of the Land Registry’s position, I agreed with the plaintiff that the Amended Writ is not a lis pendens registrable under the Land Registration Ordinance because it does not relate to the Subject Property or an interest therein within the meaning of the said Ordinance.

13.  The law on the meaning of a lis pendens is trite. As To J explained in LY Group Development Ltd v East Canton Ltd [2015] 4 HKLRD 84 at [61]:

“… the essential ingredients of a lis pendens are that it must be an action affecting land in the sense that it is one which asserts a claim of right, or a claim to charge some specific property or some proprietary right in land. An action may not be registered as a lis pendens simply because the defendant owns landed property.” (emphasis added)

14.  As Recorder Stewart Wong SC also held in Hundred Gain International Holdings Ltd v Cheng Mei Holdings Ltd [2023] 5 HKLRD 528 at [49], a pending action may still constitute a lis pendens even if no interest to or a transfer of land is being claimed in that action, as long as it seeks relief requiring something to be done on the land (or any other relief) which is capable of binding the subsequent purchaser or mortgagee of the land.

15.  This last point was also explained by Patrick Chan J (as Chan NPJ then was) in Chow Chiu Tai v Chan Tak Ming [1994] 1 HKLR 274 at 279-280:

“One of the main purposes of the Ordinance is to confer priority on an interest in land over another interest in the same piece of land by means of a system of registration at the Land Office of the documents affecting these respective interests. Under s16, a registrable lis pendens which is not registered ‘shall not bind any purchaser or mortgagee of the estate intended to be thereby affected’. In my view, the consideration formulated by Stamp, L J in the Whittingham’s case and followed by Browne-Wilkinson, J in the Greenhi’s case is equally appropriate in the Hong Kong context. A lis pendens, to be registrable, must be one which affects an interest in land so that if it is not registered or registered in time, the interest affected by it may lose priority to some other interest in the same land if the document relating to that other interest is registered. In other words, the question to be answered is: will the interest which is to be affected by the action or proceeding be adversely affected by or deferred to some other interest in the land if the action or proceeding is not registered or registered in time? An action which claims some proprietary right in land, as referred to by Megarry, J, would be registrable as such a lis pendens because in the absence of registration, a subsequent purchaser or mortgagee bona fide and without notice of the action will certainly take free from the proprietary right under claim even if at the end of the day such a claim is upheld by the court. Similarly an action for the reinstatement of an easement support of land or the maintenance thereof, as in Browne-Wilkinson, J’s case, will also be registrable under the Ordinance, because if the action is not registered or registered in time, any subsequent purchaser in title of this land will not be affected by any judgment which may be given in the action.

Little or no difficulty will arise in an action which makes a claim for a proprietary interest or an easement in land. However, there may be actions in which there are no direct or expressed claims for an interest in land and yet the judgment or order to be given may affect the land in question. This type of actions should also be registrable because if they are not registered, they are not binding on any purchaser or mortgagee of the land intended to be affected. And if the purchaser or mortgagee is to be bound, it is only fair that he can have notice of the pending action (ie the lis pendens) if the same is registered. On the other hand, there are cases which although they can be said to be in one way or another relating to land, are not registrable because whatever their outcome, the subsequent purchaser or mortgagee of the land in question will not be affected by the registration, or lack of it, of the action at the Land Office. The material consideration is therefore that set out by Stamp, L J and Browne-Wilkinson, J, ie whether any subsequent purchaser or mortgagee will take a free title in the land or lose priority if the action is not registered”. (emphasis added)

16.  Applying these principles to the present case, it is plain that LB’s claim in DCCJ 5030/2019 does not claim any right, proprietary right or seek to charge the Subject Property. As a matter of fact, Kut, the registered owner of the Subject Property, was not named as a defendant in the Amended Writ.

17.  Further, according to the relief sought by LB (see [7] above), LB is seeking to rescind the TA or to have it declared null and void. LB does not seek to retain any right or interest in the Subject Property. What LB wishes to obtain from the defendants to DCCJ 5030/2019 are monetary relief – whether by way of restitution or damages. That being the case, there is no question of LB seeking an order for “something to be done” on the Subject Property that is capable of binding subsequent purchaser or mortgagee.

18.  These, in my view, were determinative of the application. There is no basis whatsoever for LB to register the Amended Writ as a lis pendens against the Subject Property at the Land Registry. None of the 5 reasons given by Mr Lau as aforesaid provides a lawful basis to maintain the pending registration of the Amended Writ.

19.  There may or may not be other ways to achieve the LB’s professed objective of preserving the Subject Property pending the determination of DCCJ 5030/2019, but his attempted registration of the Amended Writ at the Land Registry is in my view the wrong way to do so.

20.  For all these reasons, I held in favour of the plaintiff and made an order in terms of paragraphs 1 to 4 of the plaintiff’s draft order, namely:

(1)  There be a declaration that sealed copy of Amended Writ of Summons under DCCJ 5030 of 2019 filed on 10^th November 2021 by the Defendant as recorded in the Land Registry register of the Property with Memorial No 24112501790018 (“the Amended Writ”), is not a lis pendens affecting the Property known as Shop T101 on the Third Floor, The Capital of the Retail Area, Park Hotel, Nos 61-65 Chatham Road South, Kowloon, Hong Kong (“the Property”);

(2)  There be a declaration that the Amended Writ is not an instrument registrable on the land register of the Property under the Land Registration Ordinance (Cap 128);

(3)  The attempted registration of the Amended Writ be cancelled and forthwith removed from the land register of the Property at the Land Registry, including any references to it as a “deed pending registration”; and

(4)  The Defendant be restrained from registering or causing to be registered on the land register of the Property any further instruments in respect of the proceeding commenced by the Amended Writ.

21.  As to costs, there is no reason why costs should not follow the event. Having considered the plaintiff’s summary statement of costs and Mr Lau’s submissions, I ordered that the defendant pays the plaintiff’s costs of this application summarily assessed in the amount of HKD 38,000.