CO129-514-6 Question of legality of sale of water to Tai Koo Sugar Refining Co. Ltd.- from... 6-12-1928 - 23-12-1929 — Page 24

23

TAI KOO SUGAR REFINING COMPANY LIMITED

and

-

THE GOVERNMENT OF HONG KONG

JOINT OPINION.

This case seems to us to raise three questions (i) Is

the Tai Koo Sugar Refining Company Ltd. (in this opinion

referred to as "the Company") in any way prevented by the

provisions of the lease of the 2nd September 1895 and of

the supplemental deed of the 5th August 1896 endorsed thereon,

under which the Company acquired Inland Lot No. 1336 and

the water rights they hold in connection therewith, from

selling water.

the Company to refrain from selling water by refusing to

renew the permit granted by the Government to the Company

to lay pipes in Shaukiwan Road and adjoining Crown lands

unless the Company undertakes not to sell water, and (3)

Can the Government obtain an injunction restraining the

Company from selling water on the ground that such sale

would be ultra vires the objects for which the Company

was formed as set out in its Memorandum of Association.

(2) Can the Hong Kong Government force

As to (1). It seems clear to us that at the time

negotiations for the purchase of Inland Lot No. 1336 were

first entered into between the Government and the Company

both the Government and the Company intended that the

water to be stored in the reservoir constructed on Inland

Lot No. 1336 should be used for the purpose of the business

of the Company only, that is to say for the Company's

private use, and that the Company were to have no right

to sell or dispose of it for their own profit to thira

parties. This appears from the letter of the 12th May

1895 from the Director of Public Works to the Company's

1.