Execution of assignment by PRC Company

If a company has a metallic common seal, the corporate name must be clearly engraved on it. The Court cannot take judicial notice of mainland law and practice concerning the execution of assignments.

Wang Zhidun v Tsoi Ming Pui ([2011] HKEC 611, DC) concerned requisitions raised on the sale of a property. One of the assignments in the chain of title was by a Hong Kong company. The corporate name was not legible on the common seal used on the assignment. Wang Zhidun asked for a confirmatory assignment but the defendants did not procure this. The Court held that the purchaser’s objection was valid. On Hong Trading Company Ltd v Bank of Communications  was authority for the proposition that execution is defective when a company uses a metallic seal and the corporate name is not clearly engraved on it.

Another relevant assignment was by a PRC company that had used a rubber chop instead of a common seal. The purchaser had asked for a legal opinion by a qualified PRC lawyer to confirm that this was a valid mode of execution by a PRC company. The seller refused to comply. Again, the Court agreed that this requisition had been valid and had not been properly answered. The Court cannot take judicial notice of PRC law concerning the mode of execution of documents by PRC companies.

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