恆麗園業主立案法團第四屆管理委員會 v. 恆麗園業主立案法團第二屆管理委員會及另一人

LDBM 73 of 2004

IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

BUILDING MANAGEMENT APPLICATION NO. 73 OF 2004

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REASONS FOR DECISION

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1. This is an Application brought by the 4th Management Committee of The Incorporated Owners of Hanley Villas ("the IO"). The 1st Respondent is the 2nd Management Committee of the same IO and the 2nd Respondent is its 3rd Management Committee. The dispute is over the validity of two resolutions: one passed by the 1st Respondent in the year 2000 and the other passed by the 2nd Respondent in the year 2001 when they were respectively in office.

2. These resolutions required the IO (and not any management committee) to reimburse individual owners the fees and costs they incurred for investigation and rectification of the leakage problems if the problems should be caused by defects of construction of the external wall.

3. There is in fact a claim in the Small Claims Tribunal by the owner of Unit T5-26A against the IO for payment of $5,000 as fees for the authorised person who conducted the investigation of leakage in that unit and another sum of $20,000 for rectification of the problem. The IO defends that claim by saying that the 2 resolutions relied on by the owner were invalid and the IO is not obliged to pay the said sums to that owner.

4. This Application is brought by the 4th Management Committee of the IO against its 2nd and 3rd Management Committees for declarations that the 2 resolutions are invalid and of no legal effect. The 4th Management Committee thinks that if it can succeed in this Application, the owner of Unit T5-26A would not be able to maintain the claim in the Small Claims Tribunal. The claim in the Small Claims Tribunal has been stayed pending the adjudication by this Tribunal of this Application.

5. I find that there is no lis or dispute in this matter between the 4th Management Committee, on the one hand, and the 2nd and 3rd Management Committees, on the other hand, that would require adjudication. I say this because the adjudication on the validity of these resolutions will not affect the position of any member of these management committees in their capacities as members of the committees. The management committees of the IO are not legal persons. They are only committees that manage the affairs of the IO at different times. They do not make any resolution for their own sake but for the sake of the IO. The 2 resolutions in question were the acts of the IO as a legal person and not the acts of independent management committees.

6. A management committee of an incorporated owners of a multi-storey building or a housing estate is just like the board of directors of a limited company. The company is a legal person but the board of directors is not. The fact that section 45 of the Building Management Ordinance, Cap. 344 has included a management committee as one of the persons who is competent to commence proceedings in the Tribunal under that section is, without more, insufficient to make the management committee a legal person. When the interest of the company is in issue, it is the company that can sue or be sued in its own name, not the board of directors. The board of directors is not a legal person independent of the company. The same applies to an incorporated owners and its management committee.

7. It is thus not right for one management committee to sue a previous committee or committees for declarations that resolutions of the previous committee(s) were invalid. The committees are not interested parties on the validity of the resolutions. Any claim or dispute on the validity of the resolutions should be resolved between the IO and those who would wish to rely on the resolutions for their own benefit as against the IO. When the interest of the IO is involved, it is the IO that should sue or be sued, not any of its management committee.

8. The true dispute on the two resolutions is between the IO and the owner of T5-26A. The owner is not seeking payment by the 4th Management Committee or any other Management Committee of the IO. The owner is seeking payment by the IO itself. However, as neither the owner nor the IO is a party to this Application, the adjudication of the resolutions in this Application will not affect the interests of either the owner or the IO.

9. For the above reasons, this Application is improperly constituted. The case that is properly constituted is the claim before the Small Claims Tribunal which is between the IO and the owner of Unit T5-26A. The validity of the two resolutions should be resolved in that claim. If the members of the 2nd and/or 3rd Management Committees would like to assist that owner in advancing that claim, they may do so by giving evidence at the trial of that claim. Whether that claim should be transferred to this Tribunal is a matter for the Small Claims Tribunal.

10. Since this Application before this Tribunal is not properly constituted, I will adjourn it for the Applicants to consider whether they should reconstitute the parties and if so, how to achieve it. The Applicant should also consider whether it should proceed with this Application or withdraw it. I would make no order as to costs for today. I also grant the parties liberty to apply to restore this Application.