Compulsory Sale — Lands Tribunal Rejecting Amendments to Compulsory Sale’s Conditions
In Kerryford Holdings Ltd & Ors v Profit Valley Ltd & Ors [2025] HKLdT 75, the Lands Tribunal dismissed the majority owner’s application to amend the particulars and conditions of a compulsory sale for three buildings in Causeway Bay (at the reserve price of over HK$2.6 billion). The Tribunal rejected the clauses imposing the additional burden on minority owners to discharge mortgages at their own expense (including those in negative equity) and deliver title deeds within the 3-month statutory period for auction. It was affirmed that the trustees must handle encumbrances of the properties via sale proceeds under the statutory provisions without inventing additional duties or preconditions before completion on the minority owners.
Chris Wong, instructed by Messrs. So, Lung & Associates, represented the 40th Respondent and successfully opposed the proposed amendments.
Core Issues
The applicants sought to impose the following amendments to the Particulars and Conditions of Sale:
• Right to request for a “formal completion” in person upon written notice;
• Obligations on each owner to deliver title deeds and all relevant documents to the purchaser upon completion;
• Requirement on each owner to discharge all encumbrances (including mortgages in potential negative equity) at their own costs before completion, with indemnity obligations for defaults.
Tribunal’s Reasoning
Accepting R40’s submissions, the Tribunal rejected the above changes and ruled that compulsory sales under Cap 545 are governed strictly by statute rather than conventional conveyancing norms in private property sales. The proceeds of the sale by auction would be dealt with in the following order:
1. Auction takes place and purchase would be completed within 3 months of the order for sale where the trustees have received the proceeds of sale.
2. After deducting expenses and legal costs from the proceeds under s.11(1), the trustees shall then apply the proceeds of sale paid to them according to the order under s.11(2).
3. The minority owners of the lot will receive their apportioned sale proceeds subject to proof of title.
It is emphasised that there is no provision under Cap 545 to impose additional obligations on minority owners to pay for any shortfall of mortgages in negative equity upfront before completion. The Tribunal further rejected the proposed requirements for owners to deliver all title deeds to the purchasers within the 3-month statutory period before the sale by auction, noting practical barriers like mortgagee-held documents and bank delays (as faced by R40), and affirmed that Cap 545 – mirroring the Lands Resumption Ordinance (Cap 124) – facilities property transfer with proof of title handled after completion.
Chris Wong
Prior to joining Chambers in 2024, Chris served as a Judicial Assistant at the Hong Kong Court of Final Appeal, where he assisted the judges with substantive appeals, leave applications, and other works of the Court generally. Chris was called to the Bar in 2023, upon his completion of pupillage with Mr. Tony Li SC, Mr. Eric Leung, Mr. Robin D’Souza and Mr. Simon Wong.
During his legal studies, Chris competed in the Willem C. Vis International Commercial Arbitration Moot, where he received honourable mentions both as an oralist and for the written memorandums.
Chris is developing a broad civil and criminal practice. He is fluent in English, Cantonese, and Mandarin. He accepts instructions in all areas of work.
View Chris’s profile for more details.
This article was first published on 22 December 2025.
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