TANG KING WO TSO v. TANG MAU WA

HCMP 951/2020

[2020] HKCFI 1971

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 951 OF 2020

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DECISION

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1.  The Applicant is a Tso. Its approved manager is Mr Tang Kwok Cheung (“Mr Tang”). The Applicant is the registered owner of ALL THAT piece or parcel of ground registered in the Land Registry as Lot No 119 in Demarcation District No 38 together with the messuages, erections and buildings thereon (if any) (the “Property”).

2.  Before this Court is the Applicant’s ex parte Originating Summons dated 23 June 2020 for an order pursuant to s 12A of the Conveyancing and Property Ordinance, Cap 219 (the “C&PO”) that the Property be discharged and free from the Mortgage (the “Mortgage”, described below) by the payment of a sum of money into court.

The evidence

3.  The application is supported by the affirmation of Mr Tang filed on 2 July 2020.

Directions for paper disposal

4.  In view of the prevailing public health situation caused by the COVID‑19 epidemic, I on 22 July 2020 gave directions that the ex parte Originating Summons be dealt with on paper.

5.  On 24 July 2020, Mr Patrick Lau, counsel for the Applicant, filed his written submissions in support of the application.  He has also placed before me a number of authorities, which I have all read. 

The Property

6.  Exhibited to Mr Tang’s affirmation are the land search records of the Property.  According to the same:

 (a)  by an instrument dated 16 June 1916 and registered on the same day via Memorial No N33853 (ie the Mortgage), the Property was mortgaged to Tang Mau Wa, ie the Respondent herein.  The recorded consideration was HK$10.00;

 (b)  subsequently on 20 August 1963, the Property was assigned to the Applicant;

 (c)  no discharge or redemption of the Mortgage has been registered;

 (d)  the Mortgage is on the face of record still subsisting, and the Property is still subject to that encumbrance.

The relevant law

7.  S 12A of the C&PO stipulates that:

“ (1) Where land is subject to any encumbrance, whether immediately realizable or payable or not, and the encumbrancer is out of the jurisdiction, cannot be found or is unknown, or if it is uncertain who the encumbrancer is, the court may, if it thinks fit, on the application of the party for the time being entitled to redeem the encumbrance, direct or allow payment into court of a sum of money sufficient to redeem the encumbrance and any interest thereon.

(2) Upon payment into court of the sum referred to in subsection (1), the court may, if it thinks fit, and either after or without any notice to the encumbrancer, as the court thinks fit, declare the land to be free from the encumbrance, and make any order for conveyance or vesting order as appropriate, and give directions for the retention and investment of the sum of money paid into court and for the payment or application of the income thereof, and for the payment of an amount certified by the court to be the reasonable costs of the applicant in making the application, such amount to be deducted from the sum of money paid into court.

(3) On application by the encumbrancer or any person entitled to the money or fund in court, the court may direct payment or transfer thereof to the persons entitled to receive or give a discharge for the same, and generally may give directions respecting the application or distribution of the capital or income thereof.

(4)  In this section, court (法院) means the Court of First Instance unless the party to the application submits to the jurisdiction of the District Court.”

8.  The effects and operation of, and the proper practice for invoking, s 12A have been considered and analyzed by Lam J (as he then was) in Re Cheung Chi Wang & Another [2002] 1 HKLRD 409 and Man Chi Kan v Man Tsak Lun [2003] 2 HKLRD 489.  I refer to but will not repeat them.  I highlight the 3 stages involved in an application made under s 12A:

 (a)  the 1^st stage is for the applicant to obtain direction or approval of the court regarding making payment into court under s 12A(1);

 (b)  the court has the discretion to decide whether notice should be given to the encumbrancer;

 (c)  upon payment in and the giving of any notice as directed, the 2^nd stage is for the court to consider whether to exercise its discretion under s 12A(2) to declare the land free from the encumbrance; and

 (d)  there may not necessarily be a 3^rd stage, but there will be if the encumbrancer or any person entitled to the money in court applies to the court for payment.  The matter will then have to come back to court pursuant to s 12A(3).

Discussions

9.  I am here only dealing with the 1^st stage.

10.  I am satisfied that the Applicant is the registered owner of the Property.

11.  I am satisfied on the evidence that the Property is still subject to the Mortgage.

12.  I am satisfied that the Applicant is entitled to redeem the Mortgage.

13.  I have considered the evidence placed before me by Mr Tang.  I am satisfied that reasonable steps have been undertaken to locate the Respondent. They include:

 (a)  searching through the papers the Applicant has;

 (b)  making enquiries with the other Manager of the Applicant;

 (c)  making enquiries through its legal advisers with the North District Office and the Land Registry;

 (d)  making enquiries with the Births and Deaths Registry; and

 (e)  conducting a computer search at the Probate Registry.

14.  I am satisfied on the evidence that the Respondent cannot be found.  S 12A(1) is triggered.

15.  The Applicant adopts a notional annual interest rate of 20% and works out that the sum of HK$218.00 is sufficient to redeem the Property.  I am satisfied that the calculations are in order.

16.  I allow the 1^st stage application.  I also in the exercise of my discretion direct general notice of my order be given by advertisement.

Disposition

17.  I order and direct that:

 (a)  Leave be granted to the Applicant to pay into Court within 14 days from the date hereof the sum of HK$218.00, that being a sum sufficient to redeem the Mortgage and any interest thereon;

 (b)  Within 7 days after the payment into Court as approved above, the Applicant do advertise in a widely circulated local Chinese newspaper a notice:

 (i)  making known this Order;

 (ii)  making known the fact that payment has been made into Court pursuant to this Order;

 (iii)  stating that any person interested in the Mortgage and/or the said payment may apply within 28 days to be joined as a party to these proceedings; and

 (c)  The Applicant may after the lapse of no less than 35 days from the publication of the advertisement make a paper application before this Court pursuant to s 12A(2) of the C&PO for a declaration that the Property be free from the Mortgage.

18.  I make no order as to costs.