FAMOUS CHARM LTD v. SECRETARY FOR JUSTICE (FOR AND ON BEHALF OF THE LAND REGISTRAR)

HCMP 1171/2025

[2025] HKCFI 5757

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1171 OF 2025

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BETWEEN

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REASONS FOR DECISION

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I. INTRODUCTION

1.  By Originating Summons filed on 15 July 2025 (the “Originating Summons”), the Plaintiff sought an order to vacate the Notice dated 4 December 2018 (the “Notice”) issued by Magistrate under section 145A(2) of the Crimes Ordinance (Cap. 200) and registered in the Land Registry by Memorial No. 18123100590010. The Defendant was the Land Registrar, and upon my directions given on 25 September 2025, the Prosecution Division of the Department of Justice was joined as an interested party.

2.  At the end of the hearing, I granted the order to vacate the Notice as sought by the Plaintiff in terms of relief 1 of the Originating Summons. Here are my reasons.

II. BACKGROUND

3.  The Plaintiff has since 8 May 2017 been the registered owner of the Shop on 2/F, Tak Sing Alliance Building, No. 115 Chatham Road South, Kowloon (the “Property”).

4.  On 8 May 2017, the Plaintiff acquired the Property together with other landed properties for HK$68,647,800 subject to an existing tenancy. That existing tenancy (the “2016-2018 Tenancy Agreement”) was executed between the previous owner and one Yeung Shing (the “Former Tenant”) for a period of two years from 1 December 2016 to 30 November 2018.

5.  On 30 November 2018, the Plaintiff regained possession of the Property.

6.  On 31 December 2018, the Notice registered against the Property with the Land Registry. The Notice was issued by the Principal Magistrate of the Magistrate’s Court at Kowloon City. It stated:-

“CRIMES ORDINANCE CAP. 200 (s. 145A(2))

Case No: KCCC 3278/2018

IN THE MAGISTRATE’S COURT AT KOWLLON CITY

NOTICE

TO: THE LAND REGISTRAR

Address of the premises: [address of the Property]

Notice is hereby given pursuant to section 145A(2) of the Crimes Ordinance (Cap. 200) that D1 WONG Ho-ching Ivan [and] D2 WONG Ki-yan have been convicted of an offence under section 139 of the Ordinance in relation to [the Property] on the 4^th day of December 2018.

Dated this 4^th day of December 2018

[signed]

Principal Magistrate”

For convenience, I shall refer to the two convicted Defendants there as the “Offenders”.

7.  Section 139 of the Crimes Ordinance (Cap. 200) (the “Ordinance”), the offence under which the Offenders were convicted, provides that:-

“Keeping a vice establishment

(1) A person who on any occasion —

(a) keeps any premises, vessel or place as a vice establishment; or

(b) manages or assists in the management, or is otherwise in charge or control, of any premises, vessel or place kept as a vice establishment,

shall be guilty of an offence and shall be liable…

(2) Where —

…

(b) a person is acquitted or convicted of… an offence under this section,

section 145A applies.”

8.  Section 145A of the Ordinance was the provision pursuant to which the Notice was issued. It provides that:-

“(2) Where a person is acquitted or convicted by a court or magistrate of… an offence under section 139, 143, 144 or 145, the court or magistrate… (as the case may be) shall as soon as reasonably practicable send a notice in writing to the appropriate person stating that fact and the date on which it occurred and setting out the specified information.

(3) In this section —

(a) in the case of an offence alleged or proved to have been committed in relation to any premises or place other than a vessel, the Land Registrar…”

9.  By section 153M(1) of the Ordinance, the Land Registrar shall then register the notice against the relevant property, and by section 153M(2) of the Ordinance, such a notice “shall be deemed to be an instrument affecting land, but a failure to register such a notice of copy of an order shall not… affect its validity as against any person”.

10.  It is the Plaintiff’s evidence, which was not challenged, that:-

(1) The Notice and the registration of the Notice came to the Plaintiff’s attention only after the termination of the 2016-2018 Tenancy Agreement;

(2) The Plaintiff never had any contact with any of the Offenders;

(3) The Plaintiff never had any knowledge as to when and how the Offenders committed the offence at the Property; and

(4) The Property had since never been used as a vice establishment or for any other illicit purposes.

11.  On 6 June 2025, the Plaintiff and a purchaser entered into a provisional sale and purchase agreement in respect of the Property. Upon the purchaser’s request, a clause was added to the agreement that completion could only take place upon a court’s declaration that the Notice had become vacated from the registration or ineffective, but if no completion could take place on 31 December 2025, the sale and purchase would be cancelled.

12.  Thus, the Plaintiff made the present application.

III. PROCEDURAL HISTORY

13.  The Originating Summons was first heard on 22 September 2025. The Defendant also appeared at the hearing upon my refusal of their prior application to be excused from the hearing. At that hearing, I specifically asked the Defendant to provide further research on the legislative intent and purpose of section 145A of the Ordinance and to liaise with the investigative authorities like the Police to see whether the Plaintiff was associated with the Offenders. I adjourned the matter until 11 November 2025 for the parties to consider the matter.

14.  Meanwhile, on 23 September 2025, the Defendant wrote to this Court saying, in essence, that the Defendant was not in a position to address the Court on the legislative intent and purpose of the relevant statutory provision and it was not the statutory role of the Defendant to investigate the connection between the Plaintiff and the Offenders.

15.  As a result, I directed the Plaintiff to join the Interested Party. This was, in my view, necessary for the fair disposal of the matter because the Notice was issued and registered under the Ordinance upon the Interested Party’s prosecution, and therefore, the Interested Party had every reason to state its position clear as to the Notice. Another consideration I had was that given the potential jurisprudential significance of the matter, the Court needed proper assistance rather than one-sided argument from the Plaintiff only.

16.  On 4 November 2025, the Plaintiff filed Skeleton Submissions in support of its application, which I shall explain in more detail below. The Interested Party then wrote to this Court to explain why it agreed with the Plaintiff’s submissions in the Skeleton, and sought excuse from attendance of the hearing. Further, on 7 November 2025, the Defendant filed a Short Note to highlight that there were no statutory provisions for vacation of notices issued under section 145A of the Ordinance, but took a neutral stance in the matter. The Interested Party’s attendance to the hearing was excused, while Mr Louie Chan, counsel for the Defendant, attended the hearing making submissions on costs and more importantly, on how such applications in the future should be dealt with, in particular, whether the Land Registrar should be joined as a Defendant or any party to such applications at all. I shall return to this matter after I deal with the Plaintiff’s application itself.

IV. THE RELEVANT STATUTORY REGIME

17.  Mr John Fong, counsel for the Plaintiff, conducted detailed research on the relevant statutory provision, for which I am grateful to him. In this Part, I largely draw on his submissions.

18.  The legal principles in relation to statutory interpretation are well established. The Court has to interpret statutes by reference to the natural and ordinary meaning of the words having regard to its context and purpose: see HKSAR v Chan Chun Kit (2022) 25 HKCFAR 191 at §10 per Cheung CJ. Context is to be taken in “its widest sense”, as the legislative purpose may be “evident from the provision itself, the recommendation of a report such as that published by the Law Reform Commission, the explanatory memorandum to the relevant bill or a statement by the responsible official of the government in relation to that bill in the Legislative Council” as well as “the history of the provision concerned”: see HKSAR v Chan Chun Kit, supra at §11.

19.  The purpose of issuing a notice for registration under section 145A has to be ascertained from the wider context, which can be found in sections 153A, 153B, 153C, 153H and 153I of the Ordinance, all related to a Court’s closure order in respect of the premises found to have been used as a vice establishment.

20.  Section 153A of the Ordinance provides that if an offence under section 139, 143, 144 or 145 is committed within “a period beginning 4 months after and ending 16 months after a conviction of that or any other person for an offence under any of the provisions…” (section 153A(1)), the court or the magistrate may make a closure order in respect of the premises (Section 153A(2)(a)). By section 153B(1)(b) of the Ordinance, the premises are to be closed for 6 months upon a closure order.

21.  Further, by section 153H of the Ordinance, the closure order in question will remain valid pending the determination of an application to rescind under section 153C of the Ordinance (to which I shall return). By section 153I of the Ordinance, the court or magistrate may suspend a closure order for 2 years in certain circumstances, but the suspended closure order may be revived if the conditions attached to the suspension are breached. The court or magistrate making the suspension order shall send a notice of the same to the Land Registrar under section 153I(8) and by section 153M (again) of the Ordinance, the Land Registrar shall register the notice.

22.  One could immediately see that if no notice would be issued and registered under sections 145A and 153M of the Ordinance, the public simply would not have any reasonable means to know whether the premises are a vice establishment in respect of which an offence contrary to section 139 has been or has been repeatedly committed. If there were no such notice, a purchaser for value might acquire the premises, only to find that the premises might be subject to a closure order or that the premises had already been subject to a possibility that a suspended closure order may be revived. While not an issue in the present case, it is also clear that the notice issued under section 153I of the Ordinance has the same effect.

23.  Therefore, the purpose of sections 145A (as well as section 153I) and 153M of the Ordinance is clear.

(1) It is to give notice accessible by the public that the premises have been a vice establishment in respect of which a conviction has been or has been repeatedly found, and thus any purchaser (or mortgagee or chargee) would acquire an interest in the premises at his own risk, a risk that the premises may or may have been subject to a closure order already.

(2) Where no notice has been registered, for a period from the conviction to the registration of the notice, the public would not have any reasonable means to know whether the premises have been a vice establishment in respect of which a conviction has been or has been repeatedly found. Therefore, to provide protection for purchasers (or mortgagees or chargee) for valuable consideration of an interest in the premises during such a period, section 153C provides that such a purchaser (or mortgagee or chargee) may apply to rescind the closure order.

24.  The above purposes, ascertained from the statutory provisions themselves, are consistent with the report by the ad hoc group of the Legislative Council established to consider the Crims (Amendment) Bill 1989. The ad hoc group recommended that to protect innocent owners or purchasers, statutory provisions for issuing and registering relevant notices should be enacted. The Law Society supported the recommendation, and the Government accepted this recommendation: see the Official Report of Proceedings of the Hong Kong Legislative Council (25 July 1990) pp 8-12.

V. NATURE OF THE NOTICE

25.  Logically, it follows that a notice issued under section 145A and registered under section 153M of the Ordinance shall no longer serve any of its purposes (1) 16 months after the last relevant conviction, or (2) expiry of the suspension order of 6 months, or (3) in the event there has been a suspension order, 2 years after the suspension order plus any remaining period for the closure order which cannot exceed 6 months, whichever is longer. Upon the expiry of the relevant period, there can no longer been any closure order made with the previous convictions as the basis, and there is no longer any valid closure order extant or to be resumed. It follows that upon the expiry of the relevant period, such a notice no longer affects an interest in the land.

26.  In the present case, the Notice was issued on 31 December 2018. Any such periods have long expired, be it the longest being 2.5 years (2 years of suspension of a 6-month closure order). As a result, the Notice no longer serves any purpose, and no longer affects the Property.

VI. JURISDICTION TO VACATE THE NOTICE

27.  There is no dispute that the Ordinance does not contain any provision for vacation of the registration of such notices issued and registered under section 153M of the Ordinance.

28.  As regards the Land Registration Ordinance (Cap. 128), the only section conferring jurisdiction on the Court to vacate registration of a registered instrument is section 19. However, it only provides for vacation of a lis pendens. The Notice does not fall within the definition of “lis pendens” under section 2.

29.  The Court, however, has inherent jurisdiction to vacate the registration of an instrument not affecting land: see Wong Kum Chi v Lee Tit Ying [2003] 1 HKLRD 594 at §16 per DHCJ Cheung (as he then was); Re Li Fat [2009] 5 HKLRD 259 at §5 per Chu J (as she then was).

30.  In the present case, while by section 153M(2) of the Ordinance, the Notice is deemed to affect land, I have found that the Notice no longer affects the Property and thus the deeming effect is rebutted. Given that the Notice no longer affects the Property, and given that the Notice would be a stigma on the Property irrespective of any demand from the potential purchase to vacate the registration of the Notice, I found it just and convenient here to exercise the inherent jurisdiction to vacate the registration of the Notice.

31.  Thus, I made an order in terms of relief 1 of the Originating Summons at the end of the hearing.

VII. SHOULD THE LAND REGISTRAR OR PROSECUTION DIVISION BE JOINED?

32.  An issue remains as to whether the Land Registrar or the Prosecution Division of the Department of Justice should be joined in such an application in the future. As mentioned at the outset, the attendance of the Prosecution Division was excused. Mr Louie Chan, for the Secretary for Justice acting for and on behalf of the Land Registrar, submits that the Land Registrar should not be joined in such an application in the future because the Land Registrar simply does not have any power to decide whether or not to vacate such a notice, but only the Court has the inherent jurisdiction to do so.

33.  To be fair to the Plaintiff, the present application was the first of its kind in Hong Kong as far as I know. I would understand why for prudence sake, the Plaintiff joined the Land Registrar as the Defendant. In fact, I also found it necessary to join the Prosecution Division of the Department of Justice to ensure that the legal position would be fully considered by the parties concerned and the Court would obtain as much assistance as possible.

34.  That said, now that the present case should serve as a precedent, I agree with Mr Chan that the Land Registrar should in the normal course of events not be joined in such an application in the future, and in the normal course of events, if the applicant would like to seek any clarification from the Land Registrar, he could do so by way of correspondence. Legally, the Land Registrar simply has no role in such an application. Insofar as an court order vacating the registration of such a notice is sought, it is not necessary to join the Land Registrar as a party. In fact, Re Li Fat, supra, was an ex parte application, and Chu J (as she then was) simply ordered vacation without any need to convert the ex parte application to an inter partes application.

35.  As regards the Prosecution Division of the Department of Justice, similarly, it has no legal role to play and therefore, in the normal course of events, it should also not be joined.

36.  At the risk of stating the obvious, such an application, in the future, shall be made ex parte, and because it will be an ex parte application, the applicant shall have the duty to make full and frank disclosure.

37.  For the sake of completeness, I record that I made a costs order in favour of the Land Registrar in the present Originating Summons. As I said, the present application is the first of its kind in Hong Kong, and while the Land Registrar suggests that it should not be joined in such an application in the future, he had incurred costs in dealing with the matter (for which I am grateful) and I was of the view that this was justified in the present Originating Summons.