RE LAND REGISTRY AS LOT NO. 1771, LOT NO. 1772, SECTION C OF LOT NO. 1773, AND TAN CHUK HANG LOT NO. 59 ALL IN DEMARCATION DISTRICT NO 76

HCMP1553/2007

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1553 OF 2007

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J U D G M E N T

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1.  This application, which was commenced by originating summons, relates to Lot No. 1771, Lot No. 1772, Section C of Lot No. 1773 and Tan Chuk Hang Lot No. 59, all in DD 76 in Northern New Territories (“the Properties”).

2.  By way of succession registered on14 August 1935, a Deed of Sale dated 20 April 1936 and an Assignment dated 14 June 1937, the Properties were vested in Cheung Kam Fan and Cheung In Fan as tenants-in-common, with Cheung Ng Shi, their mother, as their trustee. Presumably, this was because they were minors at the time.

3.  The applicant is the wife of Cheung Kam Fan. She makes the present application in her capacity as the administratrix of Cheung Kam Fan.

4.  According to the applicant, Cheung Ng Shi died sometime before March 1939. No Probate or Letter of Administration had been granted in respect of her estate. 

5.  On 14 March 1939, Cheung Chan Shi (also known as Chan Yuet Kiu) was appointed as the trustee of Cheung Kam Fan in respect of, inter alia, his half share in the Properties.  Mr Chan who appeared for the applicant informed the court that this was done because Cheung Kam Fan was then still a minor. Although there is no evidence before the court as to the age of Cheung Kam Fan, I am prepared to accept that this is probably the case.

6.  In the case of Cheung In Fan, however, there was no appointment of a new trustee. The evidence before the court does not show the age of Cheung In Fan in around 1939. It is simply not known why no trustee was appointed for Cheung In Fan after the death of Cheung Ng Shi.

7.  On 9 July 2002, Cheung Chan Shi, who was the trustee of Cheung Kam Fan, died. On 2 June 2005, Letter of Administration of her estate was granted to Cheung Sui Kwan.

8.  On 27 June 2004, Cheung Kam Fan died. On 16 May 2005, Letter of Administration of his estate was granted to the applicant.

9.  Subsequently by an Assignment dated 23 September 2005, Cheung Sui Kwan, as the administrator of Cheung Chan Shi, re-assigned and vested in the applicant, as the administratrix of Cheung Kam Fan, the legal interest of Cheung Kam Fan’s half share in the Properties.

10.  In consequence of the 23 September 2005 Assignment, the applicant holds both the legal and beneficial interest of Cheung Kam Fan’s half share in the Properties.

11.  As for Cheung In Fan, he died on 15 August 1989. Letter of Administration of his estate was granted to Cheung Chan Shi on 14 September 1995.

12.  By an Assignment dated 2 May 2000, Cheung Chan Shi (as the adminstratrix of Cheung In Fan) assigned to Cheung Kwai Yuen, Cheung Sui Kwan and Cheung Chun Yuen, who are Cheung In Fan’s sons, to hold as tenants-in-common, Cheung In Fan’s half share in the Properties.

13.  Pausing here, three observations are to be made. First, although there is no evidence of Cheung In Fan’s date of birth, it can be safely assumed and I am prepared to accept that he must have attained majority by the time of his death. Second, until his death, the legal interest of his half share in the Properties that was vested in his mother, Cheung Ng Shi, as trustee had not been re-assigned to him. Third, it follows that apart from having an one-half beneficial interest in the Properties, the estate of Cheung In Fan also had a right to seek the re-assignment to and vesting of the legal interest of the half share from the estate of Cheung Ng Shi. This right would have passed by the administratrix, Cheung Chan Shi, to the three sons by the 2 May 2000 Assignment.      

14.  By an Assignment dated 28 September 2002, Cheung Sui Kwan assigned to his son, Cheung Man Kin, his beneficial interest in the Properties. What is pertinent to note is that the assignment expressly stipulates that: “… the vendor (i.e. Cheung Sui Kwan) as beneficial owner assigns to the purchaser (i.e. Cheung Man Kin) …”. There was no reference to his legal interest that was still held on trust by the estate of Cheung Ng Shi. The implication is that Cheung Sui Kwan had not assigned to Cheung Man Kin the right or interest in respect of the legal interest that was still held on trust by the estate of Cheung Ng Shi.

15.  Nevertheless, as a result of the 28 September 2002 Assignment, the beneficial interest of Cheung In Fan’s half share in the Properties came to be held by Cheung Kwai Yuen, Cheung Man Kin and Cheung Chun Yuen as tenants-in-common.

16.  By an Assignment dated 8 March 2007, Cheung Kwai Yuen, Cheung Man Kin and Cheung Chun Yuen assigned all their interest in the Properties to the applicant in her capacity as the administratrix of Cheung Kam Fan. In consequence of this, the applicant, as the administratrix of Cheung Kam Fan, now holds the entirety of the beneficial interest in the Properties. One-half of the legal interest in the Properties is also vested in her. The other half of the legal interest remains vested in the estate of Cheung Ng Shi. The applicant is presently desirous of selling the Properties, hence this application to deal with the remaining half of the legal interest.

17.  I am satisfied that this is a proper case to remove the trust in respect of the half share previously owned by Cheung In Fan and currently by the applicant. Principally, the object of the trust created in favour of Cheung Ng Shi would have lapsed upon Cheung In Fan attaining majority, at which point the trust should have been terminated and the trustee removed with the legal interest being re-assigned to and vested in him. It is possible that this already arose at the death of Cheung Ng Shi, but since there is no evidence of Cheung In Fan’s date of birth and the exact date of Cheung Ng Shi’s death, no conclusion can be drawn.             

18.  The applicant being the purchaser and assignee of Cheung In Fan’s half interest in the Properties is entitled to apply under section 45(e) of the Trustee Ordinance, Cap 29 for a vesting order to have the legal interest vested in her, subject to the problem mentioned in paragraph 14 above. Mr Chan informed the Court that Cheung Sui Kwan, as well as Cheung Kawi Yuen, Cheung Chun Yuen and Cheung Man Kin all consent to the present application and for the legal interest to be vested in the applicant. The applicant also undertook by counsel to file within 21 days affidavit evidence confirming the consent. This in my view is sufficient to overcome the problem.

19.  In the circumstances and on the basis of the said undertaking given through counsel, the application is granted. There is an order that the one-half legal interest in the Properties held by Cheung Ng Shi, deceased on trust for Cheung In Fan, deceased shall be vested absolutely in the applicant. There is no order as to costs.