TNAG-0944-FCO40-1163-Future-of-Hong-Kong-1980 — Page 159

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(b) The Governor of Hong Kong therefore cannot at

present grant leases of land in the New Territories which purport to run begond 1997. This conclusion is based partly on the wording of the Letters Patent, coupled with that of the 1898 Order in Council, and partly on the inability of the Crown, as lessor, to convey a greater title than it has itself.

I gather that Mr. Rushford is inclined to dispute this particular conclusion. But he accepts that it is at least arguable and that that, in practice, is enough to undermine the confidence which we would want the lessees to have.

(c) It is equally beyond the capacity of the Governor,

as the legislature of Hong Kong, to confer on himself the power to grant such leases.

(a) However, the Crown could, by a prerogative act which

could take the form of a prerogative Order in Council, arrogate to itself the right to exercise jurisdiction unlimited in point of time so that something done in exercise of it could lawfully purport now to have effect beyond 1997.

I do not question this conclusion but I have one general comment to make on it and two reservations about its implications or consequences:

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(i) What is discussed here does not seem to be open to the objection which you made to last year's proposal, as recorded in Mr. de Winton's letter of 16 July 1979 (Flag B), ie that it would have no legal effect until 1997. I think that this proposal would have a present legal effect in validating acts (or giving effect to acts according to their tenor) which the courts would otherwise have to treat as ineffective or having an unintended effect.

(ii) Such an extension of our present juris- diction would, I think, be incompatible with the 1898 Convention and would be a kind of "annexation" - not of the territory itself but of an enlarged jurisdiction over it.

It might therefore be as objectionable to the Chinese as was last year's proposal.

Lym

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