CO129-540-11 Grants of new Crown Leases 12-5-1932 - 11-8-1932 — Page 8

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No. 244.

GOVERNMENT HOUSE,

HONG KONG, 12th May, 1932.

Mod

Sir,

I have the honour to acknowledge the receipt of

your despatch No.52 of the 16th February, 1932, on the

subject of the granting of new Crown Leases for sub-divided

Town and Suburban lots in Hong Kong and to enclose the

opinion of the Attorney General on the points raised in the

second paragraph of your despatch.

2.

With regard to the third paragraph of your

despatch I am advised that it would be regarded as

extremely inequitable to make the issue of separate leases

conditional on the acceptance of the abolition of an old

999 years lease. It would in all probability prevent the

voluntary surrender of any old 999 years lease, and even

where the Crown had re-entered for default the equities of

the case seem to compel the Crown to grant new leases on

terms similar to those of the original lease. In the

circumstances I strongly urge that permission be given to

issue the new leases on terms similar to those of the old

leases.

THE RIGHT HONOURABLE

I have the honour to be,

Sir,

Your most obedient, humble servant,

1.D. Southoch

Officer Administering the Government.

SIR P. CUNLIFFE-LISTER, G.B.E., M.C., M.P.

etc.,

etc.,

etc.,

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Opinion.

The second paragraph of the Secretary of State's despatch

of the 16th February, 1932, has been referred to me for

my opinion on the points raised therein.

,

In this Colony the practice has been to look to the

holder of the, so-called, Remaining Portion of lots leased

by the Crown for payment of the Crown rent. He holds the

Crown lease and the title of the Section holders and their

mortgagees is derived from assignments made by himself or

some previous holder or the Remaining Portion. Al though it

may be on the authorities referred to in paragraph 3 of

the Governor's despatch of the 23rd October, 1931, that, if

he is himself an assignee, he camot be successfully sued

for the whole Brown rent; in practice he collects a share

from the section holders and pays the whole to the Treasury

as long as the value of the Remaining Portion to himself and

the fear of re-entry by the Crown are sufficient to induce

him so to do. But it happens sometimes that all the land

of any value in a lot has been assigned to section holder s

so that all that is left to the Remaining Portion holder is

unsaleable land consisting of scavenging and other lanes

giving access to the sections. In these cases re-entry by ·

the Crown is a matter of indifference to him. The sufferers

in such cases are the section holders and their mortgagees

who have paid for or advanced money on the land and

buildings on the faith that, as long as they paid the Crown

rent of the property assigned to them and performed the other covenants in relation thereto, they would not be

disturbed in their possession. Moreover their purchases and

mortgages have been made under the sanction given by a

Secretary of State, in despatch No. 222 of 2nd January, 1851,

to the principle of allowing Crown Lessees to alienate

portions of their lots.

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