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LCQ4: The Lee Garden Land

Following is a question by the Hon Chim Pui-chung and a written reply by the Secretary for Development, Mrs Carrie Lam, in the Legislative Council today (April 13):

Question:
 
The Government terminated the Block Crown Lease granted to Wong Wai Tsak Tong by legislation prior to the return of Hong Kong's sovereignty to China so as to resolve the dispute between Wong Wai Tsak Tong and its sub-lessees. On the other hand, the piece of land in Causeway Bay covering Lan Fong Road, Pak Sha Road, Kai Chiu Road and Yun Ping Road (the Lee Garden Land) originally owned by a family-run company was sold in lots during the 1950s with restrictive covenants incorporated in the deeds of assignment, rendering it necessary for the assignees to seek consent from the company before proceeding with redevelopment. In this connection, will the Government inform this Council:

(a) whether it has any plan to remove the restrictive covenants stipulated in the deeds of assignment for the Lee Garden Land by legislation; if it does not have such plans, of the reasons and the legal basis for that;  

(b) why the Government does not resolve the land title dispute over the Lee Garden Land in the same manner in which it resolved the land title dispute of Wong Wai Tsak Tong by legislation; whether any government department should be held responsible for that; and

(c) of the total gross floor area of the Lee Garden Land, and the annual loss in rates revenue due to the failure of the redevelopment of the buildings concerned?

Reply:

President,

Between the 1980s and the early 1990s, the Wong Wai Tsak Tong of Cheung Chau (WWTT) and the sub-lessees had disputes over the land title, the renewal of sub-leases, payment of government rent and redevelopment of the sub-leased land.  These disputes had been going on for years, and attempts to resolve the disputes in the courts failed. In 1994, a majority of these sub-leases were not renewed upon expiry as a result of the disputes, creating uncertainty to title. Property transactions in Cheung Chau were thus effectively frozen. As the above-mentioned disputes had built up to an extent that undermined the Government's proper land administration in Cheung Chau, the Government introduced the "Wong Wai Tsak Tong (Renewal and Extension of Sub-leases) Bill" in 1995, with hopes to regulate matters concerning the renewal of sub-leases, payment of government rent and redevelopment of the sub-leased land and resolve the disputes. However, the bill introduced by the Government was negatived at second reading. In the meantime, the former Legislative Council passed another Private Member's Bill which terminated the Block Crown Lease granted to WWTT and to deem all sub-lessees and sub-leases under the Block Crown Lease as Crown lessees and Crown leases respectively. The passed bill became the Block Crown Lease (Cheung Chau) Ordinance (Cap. 488).

As regards the land in Causeway Bay covering Lan Fong Road, Pak Sha Road, Kai Chiu Road and Yun Ping Road (the Lee Garden Land), it was originally owned by a private company. According to our understanding, the company carved out the land into smaller portions for sale in the 1950s, and in doing so, it imposed certain restrictive covenants in the relevant contracts which required prior agreement of the company in respect of the design and use of the proposed buildings to be erected on these portions of land. These covenants would also apply to subsequent successors-in-title who acquire the relevant land, therefore these successors-in-title would also need to obtain the company's consent in respect of the design and use of buildings.

My reply to the various parts of the question is as follows:

(a) and (b) The WWTT case and the "Lee Garden Land" case are entirely different in nature. As mentioned above, The WWTT case had led to expired sub-leases not being able to be renewed, creating uncertainty in title and undermining the Government's proper land administration. As such, the Government proposed to resolve the issue by way of legislation, the final development of which was that the bill introduced by the Government was negatived, while the Private Member's Bill terminating the relevant Block Crown Lease was passed and became the law.

The "Lee Garden Land" case is a private conveyancing matter, while there have been court judgements on relevant issues. The Government's stance has always been respecting and protecting private property rights, while keeping its interference with private contracts to the minimum. Owing to this principle, the Government has no reason to deal with the private conveyancing matters of the "Lee Garden Land" by way of legislation.

(c) The Government charges rates based on rateable values assessed on existing properties without regard to any redevelopment potential attached to the properties. We do not have information on the total gross floor area involved in the "Lee Garden Land".


Ends/Wednesday, April 13, 2011
Issued at HKT 14:45

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