TNAG-1166-FCO40-1446-Future-of-Hong-Kong-1982 — Page 49

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2. MR MORRIS

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Sir I Sinclair

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FUTURE OF HONG KONG

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040/1204

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912 Pam 912

With reference to your minute of 28 January referring to Mr Jay's minute of 24 December, my only comment relates to para. 8 of the latter, which discusses the effect (if any) upon confidence if the courts were to declare a Crown lease to be invalid in consequence of a test case.

See (45)

2. Although the Governor could grant a lease in the New Territories expiring after 30 June 1997 he is unwilling to do so since he has been advised locally that at present he lacks the power to do so. HMG are unlikely to authorize him to grant such leases without first legislating in such a way as to put his powers beyond doubt, in which event there would be no risk for adverse decision even if (as seems unlikely) anyone wished, or was able, to challenge the validity of a Crown lease by means of an action in the courts.

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3. I have minuted separately about the question of putting the Governor's powers beyond doubt.

A.R.R.

28 January 1982

AR Rushford

Deputy Legal Adviser

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