LOK SUN HAY AND ANOTHER v. LAU SEUNG

HCMP 1780/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1780 OF 2006

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J U D G M E N T

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1. This is the plaintiffs’ application for an order against the defendant that they granted a declaration that a mortgage made by Lok Foa Yau, the 1^st and 2^nd plaintiffs’ predecessor-in-title, in favour of the defendant dated 30 December 1940 and registered in the Land Registry by Memorial No. YL110735 in respect of the half undivided share of and in all those pieces and parcels of lands registered in the Land Registry as Wong Uk Tsun Lot No. 52 in Demarcation District No. 115 and Wong Uk Tsun Lot No. 119 in Demarcation District No. 115, Yuen Long, New Territories, Hong Kong is incapable of subsistence or is otherwise unenforceable by operation of the Limitation Ordinance, Cap. 347. 

2. The 1^st and 2^nd plaintiffs are paternal uncle and nephew.  They are both indigenous villagers of Wong Uk Tsun.  This application relates to two properties namely, half share of Wong Uk Tsun Lot No. 52 in Demarcation District No. 115 (“the 1^st property”) and half share of Wong Uk Tsun Lot No. 119 in Demarcation District No. 115 (“the 2^nd property”), both in Yuen Long, New Territories. 

3. The 1^st plaintiff is the present registered owner of the 1^st property.  The 2^nd plaintiff is the present registered owner of the 2^nd property.  Both properties have been in the plaintiffs’ families ever since 1905.  The evidence before me shows how the 1^st and 2^nd plaintiffs had succeeded to their respective interest in the 1^st property and the 2^nd property.

4. On 30 December 1940 Mr Lok Foa Yau, the 1^st plaintiff’s late father and predecessor-in-title, mortgaged both the 1^st property and the 2^nd property to the defendant together with another lot for securing payment of $70 on 30 December 1941 with interest thereon.  On or around 13 December 1995 the 1^st plaintiff formally succeeded to both the 1^st property and the 2^nd property from his late father, the said Mr. Lok Foa Yau.  The 1^st plaintiff then assigned by way of gift the 2^nd property to the 2^nd plaintiff on or about 22 June 1998. 

5. In or about 2005 the plaintiffs realized that there was a mortgage on the 1^st property and the 2^nd property.  However, the mortgage has not been duly discharged according to the land searches. 

6. The evidence before me shows that the plaintiffs and their families had occupied the 1^st property and the 2^nd property at least since 1905.  Neither the plaintiffs nor their families have been approached for payment under the mortgage or for any other enforcement in relation to the mortgage.  The evidence also shows that there has been no acknowledgment of any liability of payment in any way under the mortgage. 

7. The service of these proceedings has been duly effected under the order of substituted services made in these proceedings.  I am satisfied on the evidence that the mortgagees have not been in possession of the lots.  They have never taken any action to enforce the mortgage.

8. I have been referred to the relevant authorities including Fung Kam Cheung & Ors v Kwok Yiu Wing [1991] 1 HKC 321, Tang Chow Fat and others v Chan Shan and others HCMP 6404/1999 and Tang Muk Hing v Chan Kam Heng and others HCMP 342/2005.

9. I am satisfied on the authorities that the court may declare in the circumstances shown on the evidence before me that the mortgage concerned is incapable of subsistence or is otherwise unenforceable by operation of section 19 of the Limitation Ordinance. 

10. In the circumstances I make a declaration that the mortgage is incapable of subsistence or is otherwise unenforceable by operation of the Limitation Ordinance, Cap. 347.  There shall be no order as to costs.