Requisition as to due execution of assignment by corporate vendor

In Jones v Bohmann International Ltd ([2012] HKEC 919, CFI) a purchaser refused to complete a purchase on the grounds that his requisitions had not been properly answered and the seller had failed to show a good title. The first requisition concerned the assignment to the seller by a corporation.

The corporation’s articles required the authority of the board to the execution of a deed. It also required that the seal should be affixed in the presence of a director who was then to sign the deed. The corporation had a corporate director which had affixed its seal and the corporate director’s seal had been countersigned by an individual, Z. In response to a requisition, the seller produced evidence that Z was the sole director of the corporate director.

The court found that the requirements of the article had been complied with. The article was unlike that encountered in other cases where the articles required the company seal to be countersigned by  director who had been specifically authorised to do so. Here there was no requirement for a director to be specifically authorised and it was enough for the execution clause to record that the seal had been countersigned by a director.

If it had been necessary, it was not, the seller could have relied on section 23 of the Conveyancing and Property Ordinance.

A second requisition concerned the stamp duty certificate. The court thought that there was no merit to the requisition but that, in any event, stamp duty was not a matter of title.

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