Archive for the ‘New Territories Ordinance’ Category

Compensation paid on the resumption of land is not ‘land’ for the purposes of section 13 of the New Territories Ordinance

March 25, 2015

In Lok Tin Choi v Lai Kwai Lin ([2015] HKEC 389, CA) a mother held land in the New Territories on trust for her son. The land included two lots that had been resumed by the Government. The mother claimed to have an interest in the compensation money. This was on the basis of Chinese law and custom requiring her son to maintain his mother for her life and to provide dowries (if applicable) for the two unmarried daughters.

Cheung JA gave the principal judgment. Section 13 of the New Territories Ordinance allows the court to recognise and enforce any Chinese custom or customary right affecting land in the New Territories. The definition of ‘land’ in section 2 of the Ordinance does not cover compensation received on the resumption of land and so the court had no power to enforce any Chinese custom or customary right said to affect the compensation money. The cases that held that compensation received in respect of Tong land remained subject to the trust were not authority for the proposition that the compensation was equivalent to land. Cheung JA refrained from comment on the Chinese law and custom that had been invoked.

Michael Lower

The rule against perpetuities does not apply to compensation paid on the resumption of Tso land

February 23, 2011

The rule against perpetuities does not apply to compensation paid on the resumption of Tso land to which section 13 of the New Territories Ordinance applies. The law of partition does not apply to Tso land. A sale needs the consent of all of the members. There is no Chinese custom concerning the distribution of Tso land (since in principle it was not to be divided). The members themselves would have to agree on how it (or sale proceeds) should be distributed.

In Kan Fat-Tat v Kan Yin-Tat ([1987] HKLR 516) land belonging to a Tso was resumed by the government. Compensation took the form of cash and Letters B. As a result the Tso property comprised this compensation and other land belonging to the Tso. The plaintiff sought a partition of the land and per stirpes distribution of the compensation. The defendant, his brother, claimed that if the Tso failed then its property should belong to him on a resulting trust as he had provided the Tso property in the first place. It was held that section 13 of the New Territories Ordinance and Chinese customary law in the New Territories meant that the compensation remained Tso property and the rule against perpetuities did not apply. Had it applied, the Tso would fail with regard to that property and it would be held on resulting trust for the defendant. The law on partition did not apply to Tso land. Any sale or distribution needed the consent of all of the members. There was no Chinese custom as to how a distribution should be effected and the members would have to agree on this for themselves.

Perfecting transfer of land to a tong

February 22, 2011

Conveying land into the name of a tong, including the name of a sze lei (trustee or manager) in the conveyance, registering the conveyance and a list of members of the tong are effective steps to transfer land to a tong. The effect is to subject the property to a trust the beneficiaries of which are living male descendants of the relevant ancestor from time to time.

In Chu Tak-Hing v Chu Chan Cheung-Ki ([1968] HKLR 542) Chu Tak-Hing had various parcels of  land transferred to various aliases of his. In each case he specified the name of somebody as a sze lei (trustee or manager). These conveyances were registered. Chu Tak-Hing also registered lists of members of the relevant Tongs. It was held that the effect was to perfect the transfer of land to the Tongs. The land was no longer the private property of Chu Tak-Hing and did not form part of his estate. Conveying land into the name of a tong, including the name of a sze lei (trustee or manager) in the conveyance, registering the conveyance and a list of members of the tong are effective steps to transfer land to a tong. The effect is to subject the property to a trust the beneficiaries of which are living male descendants of the relevant ancestor from time to time. This judgment is interesting for its explicit attention to the relationship between Chinese customary law and section 15 of the New Territories Ordinance. It also considers the way of perfecting a transfer of land to a Tong and the effect of doing so.

Partition of Tso lands

February 20, 2011

The provision in the New Territories Ordinance giving the court power to recognise Chinese custom and customary law affecting land in the New Territories is mandatory. Accordingly, the law of partition and the rule against perpetuities do not apply to such land.

Tang Kai-Chung v Tang Chik-Shang ([1970] HKLR 276) was an action for partition of Tso lands. The six sons of a focal ancestor formed a Tso after their father’s death. The descendants of each son formed a Tong. The Tso land was divided into nine portions. Six of these were managed on behalf of the Tongs. Management of each portion rotated amongst the six Tongs. The income from the land was divided among the Tong members. The managers of the smaller Tongs brought an action for the partition of the Tso land so as to create six equally sized portions. Each Tong would then have its own portion. This application was resisted by the managers of the larger Tongs. They argued that the English law of partition (which was the law then being relied on as the Partition Ordinance came into effect after proceedings had been commenced) was inapplicable since it was inconsistent with Chinese customary law. Section 13 of the New Territories Ordinance (Cap 97) gave the court power to recognise and enforce any Chinese custom or customary right affecting land in the New Territories. Mills-Owen J held that section 13 was mandatory. It meant that the English law of partition and the rule against perpetuities did not apply to Tso land in the New Territories. The application for partition failed.