TNAG-0809-FCO40-1014-Legislation-for-Crown-lands-in-Hong-Kong-1978 — Page 23

G.S. 84

For discussion

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on 7th November 1978

43

XCR(78)237 Copy No..

31

MEMORANDUM FOR EXECUTIVE COUNCIL

PARTITION (AMENDMENT) BILL 1978

Annexed for the consideration of Honourable Members

is the Partition (Amendment) Bill 1978.

Present position regarding mortgagees or chargees where proceedings under the Ordinance are contemplated

2

AKK

163/2

RECEIVED IN REGISTRY MO. 51

3 NOV 1978

DESK OFF INDEX

PETERY

Action Taken

CLE

Section 3(2) of the principal Ordinance presently provides that no proceedings for partition or sale under the Ordinance shall be instituted without the concurrence of mortgagees or chargees. The Full Court has decided that this subsection cannot be construed to refer merely to a mortgagee (or chargee) of the entire property since such a mortgagee is in any event unaffected by any decree which the Court might make. However, since a mortgagee of an undivided share would be affected by an order for partition (as he would thereby become a mortgagee of a divided share) the Full Court regarded section 3(2) as referring to such a mortgagee and as conferring protection on him against having the nature of his security altered without consent.

3

The effect of this decision is that a co-owner of an undivided share in property could frustrate any attempt at partition by mortgaging to a person who is unwilling to concur in the institution of proceedings.

4

The Committee of the Law Society has expressed concern about the implications of this decision and has suggested that section 3(2) be deleted, and that other provisions in the Ordinance be relied upon to afford adequate protection to mortgagees in partition proceedings. This suggestion has been studied and it is considered that it should be adopted.

Jurisdiction of the District Court

in Proceedings under the Ordinance

5

Section 9 of the Ordinance confers jurisdiction on the District Court where the annual rent or rateable value, or the annual value of the land, whichever is the least, does not exceed

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