Legislative Council

LC Paper No. CB(1)1057/98-99
(These minutes have been
seen by the Administration)

Ref: CB1/PL/PLW

LegCo Panel on Planning, Lands and Works

Minutes of meeting held on Tuesday, 19 January 1999, at 2:30 pm in Conference Room A of the Legislative Council Building

Members present :

Hon Edward HO Sing-tin, JP (Chairman)
Dr Hon TANG Siu-tong, JP (Deputy Chairman)
Hon HO Sai-chu, JP
Dr Hon Raymond HO Chung-tai, JP
Hon LEE Wing-tat
Hon James TO Kun-sun
Hon LAU Kong-wah
Hon Andrew CHENG Kar-foo

Non-Panel members attending :

Prof Hon NG Ching-fai
Hon Christine LOH

Members absent :

Hon Ronald ARCULLI, JP
Hon WONG Yung-kan
Hon LAU Wong-fat, GBS, JP
Hon TAM Yiu-chung, JP

Public officers attending :

Item IV and V

Mr Patrick LAU

Acting Secretary for Planning, Environment and Lands

Item IV

Mr Wilson FUNG

Acting Deputy Secretary for Planning, Environment and Lands

Mr T Y CHEUNG

Project Manager (Hong Kong Island and Islands)
Territory Development Department

Ms Linda SO

Principal Assistant Secretary for Transport

Item V

Mr Esmond LEE

Principal Assistant Secretary for Planning, Environment and Lands (Lands)

Mr A G COOPER

Land Registrar
Land Registry

Ms May LEE

Deputy Principal Solicitor
Land Registry

Mrs Alice LEE

Registry Manager
Land Registry

Mr YUEN Wai-chuen

Assistant Registry Manager
Land Registry

Mr Geoffrey FOX

Senior Assistant Law Draftsman
Department of Justice

Clerk in attendance :

Miss Odelia LEUNG

Chief Assistant Secretary (1)1

Staff in attendance :

Ms Bernice WONG

Assistant Legal Adviser 1

Mrs Mary TANG

Senior Assistant Secretary (1)2

---

I Confirmation of minutes of meeting
(LC Paper No. CB(1)684/98-99)

The minutes of meeting on 12 November 1998 were confirmed.

II Date of next meeting and items for discussion

2. Members agreed to discuss the following subjects at the next Panel meeting scheduled for 11 February 1999 -

1. New Central Government Complex at the Tamar Basin Reclamation Site;

2. Infrastructure improvement works at Wa Shan and Ping Che in North District, and

3. Tseung Kwan O Development at Area 137.

   (Post-meeting note: at the request of the Administration and with the consent of Chairman, items (a) and (c) above were deferred for discussion.)

III Information paper issued since last meeting

3. Members noted that no information paper was issued since the last meeting.

IV Wan Chai Development Phase II
(LC Paper No. CB(1)760/98-99(01)

4. At the invitation of the Chairman, the Acting Secretary for Planning, Environment and Lands said that when the funding request for a comprehensive study (the Study) on Wan Chai Development Phase II (WDII) was discussed at the Panel meeting on 15 October 1998, members expressed concern about excessive reclamation of the proposed development. To address this concern, the Administration considered it necessary to provide more information on the objective of the Study. The Acting Deputy Secretary for Planning, Environment and Lands (Ag DS/PEL) explained that the primary objective of the Study was to investigate the feasibility of providing along the waterfront of Wan Chai and Causeway Bay the following key transport infrastructure and other essential facilities -

1. the Central - Wan Chai Bypass;

2. the Island Eastern Corridor Link;

3. the North Hong Kong Island Line to facilitate traffic from Central to Wan Chai;

4. the necessary at-grade connection roads to facilitate through traffic from Central to Wan Chai;

5. the landfall for a possible fourth cross harbour rail link and a Mass Transportation Centre; and

6. a reprovisioned Government heliport.

5. Ag DS/PEL stressed that the objective of the proposed WDII was not to reclaim land for development and that there was no pre-determined limit of reclamation. In the study brief, the Administration would specifically request the consultants to avoid reclamation as far as possible.

6. Miss Christine LOH requested the Administration to include paragraphs 5 and 6 of the information paper regarding the avoidance of reclamation in WD II in its funding application to the Public Works Subcommittee (PWSC) for consideration. She sought information on the reasons for separating the Central Reclamation project from the Wan Chai Development which should be regarded as one whole development and the progress of the former project.

7. Ag DS/PEL assured members that the Administration, in its submission to PWSC, would clearly state that the objective of WDII was not to reclaim land for development and that every piece of reclamation recommended would have to be fully justified. On the progress of the Central Reclamation project, he advised that Phases I and II had been completed. The Town Planning Board (TPB) was now in the process of meeting with persons who had raised objections to the proposed extent of reclamation in Central Reclamation Phase III (CR III) which was the last stage of the development. At its last meeting, TPB directed the Administration to revise the extent of reclamation proposed in the light of the objections raised. The Administration was now looking into the feasibility of scaling down the extent of reclamation in CR III.

8. Since CR III and WD II were at different stages of development, members were concerned about their interface. Ag DS/PEL said that there was no conflict between the two developments which were independent of one another. The two developments would be connected by the Central - Wan Chai Bypass and changes in either development would not affect the other. There was an urgent need to expedite WDII to provide the necessary transport infrastructure to facilitate smooth traffic between the east and west of Hong Kong, in particular, the road links leading from the Central - Wan Chai Bypass and the Island Eastern Corridor Link.

9. Mr LAU Kong-wah pointed out that since both CRIII and WDII involved development of transport infrastructure, planning should be done in a comprehensive manner rather than on a piecemeal basis. In view of the large number of objections received during public consultation on CR III, Mr LAU was of the view that these objections should be considered in connection with WDII, such that a more comprehensive plan for the development in the entire area could be made. In response, Ag DS/PEL explained that CRIII was at a more advanced stage than WDII. The feasibility study on CRIII had been completed and TPB was handling the objections to the proposed plan. However, the feasibility study for WDII had yet to be conducted. It would therefore not be possible at this stage to provide members with a proposed plan for WDII, nor a comprehensive plan for development in Central and Wan Chai areas.

10. Responding to Mr LAU Kong-wah's enquiry about formulation of measures to shorten the time gap between the completion of CRIII and WDII to ensure a coordinated development, the Project Manager (Hong Kong Island and Islands), Territory Development Department affirmed that there would be a time lapse of two years between the completion of these two developments. The Administration was seeking funding approval for the early commissioning of the Study to enable expeditious completion of the project.

11. To advance the completion date of the Study, Dr Raymond HO suggested narrowing down its scope and making clear its objectives. He said that public concern about the extent of reclamation must be taken note of. Ag DS/PEL assured members that the Administration would try its best to expedite the WDII project. Once funding was approved, the Territory Development Department (TDD) would commission consultants to commence the Study. The study brief would be specific and the consultants would be requested to avoid reclamation as far as possible. To minimize the time needed for the study, the consultants would not be required to put forward several options for consideration. The study would be closely monitored by TDD to ensure its smooth progress. Ag DS/PEL added that although WDII would be completed two years after CRIII, once the necessary at-grade connection roads were constructed, traffic congestion from Central to Wanchai would be greatly relieved.

12. Given the value of waterfront area, Dr Raymond HO queried the justifications to reprovision the Government heliport in WD II, Ag DS/PEL explained that for aviation safety and operational considerations, any suitable site for heliport should have at least two obstacle-free take-off climb and approach surfaces, separated by not less than 150^o for helicopters taking off and landing in different wind conditions. This pre-requisite had effectively narrowed the choice of sites to those with water frontage. As the existing heliport at Fenwick Street would have to be cleared to make way for CRIII, timely reprovisioning arrangements had to be made to ensure continuity of services. Usage of helicopter service was frequent, with an average of over 290 landings/take-off at that heliport per month. As the Government Flying Service provided, amongst others, transportation services to VIP, to minimize logistical problems, it would be ideal that the heliport location should be sufficiently close to the Wan Chai Police Station and not too far away from the Tamar Basin Reclamation Site where the New Central Government Complex would be located. Ag DS/PEL stressed that the preliminary decision to reprovision the heliport at Wan Chai was made in consultation with the Government Flying Service which had made it clear that any site which was beyond the northern shoreline such as Lamma Island and Apleichau or further east of North Point would not be considered acceptable for operational reasons. A preliminary site investigation indicated that an alternative site could be identified in WD II that would meet the operational requirements of a heliport. Subject to PWSC's approval for carrying out the Study, the feasibility of reprovisioning the heliport in Wan Chai would be examined as part of the Study.

13. Dr Raymond HO was unconvinced of the need to reprovision the heliport in the waterfront area. He pointed out that the Kai Tak area, with its extensive road networks to facilitate passenger transfer, could be a better location for the heliport. Another possible choice was the rooftop of the Wan Chai Police Station. A rooftop heliport would minimize disturbance to the public.

14. In response, Ag DS/PEL said that the Administration had studied the option of reprovisioning the heliport at the rooftop of the pier at Central Reclamation I and at the rooftop of the proposed New Central Government Complex. However, the idea was dropped on grounds of security and operational difficulties associated with the use of the heliport. A rooftop heliport could not provide direct access for the transfer of casualties from aircrafts to awaiting ambulances. Another drawback was that the provision of a fuel storage tanks at the rooftop for use by helicopters would pose safety problems in the event of fire since rooftop heliports would not be accessible by fire engines. Having regard to these various constraints, the Administration considered it a better choice to reprovision the heliport in WDII. Similarly, a site had been identified at the South East Kowloon Development for heliport to ensure the provision of helicopter services on both sides of the harbour.

15. Mr LEE Wing-tat echoed Dr Raymond HO's view that reprovisioning the heliport in the waterfront area was not desirable from a planning point of view since its operations would create noise and other nuisances. He pointed out the existence of rooftop heliports in other metropolitan cities in the world. He said that to ensure speedy medical treatment, helicopters transferring casualties should land at hospitals direct. It would be absurd to land at Wan Chai and then the patients were carried by land transport to the hospital. The Chairman requested and the Administration agreed to provide further information on the choice of site for reprovisioning of the heliport.

16. Regarding the reprovisioning of waterfront facilities affected by WDII, Ag DS/PEL said that this would be examined by the Study. Waterfront facilities which might be affected included the public cargo working area, the Yacht Club and the typhoon shelter. Due regard would be given to the overall design of the new waterfront to maintain its attractiveness and to ensure that the waterfront would not be adversely affected by the development of transport infrastructure facilities.

17. Mr LEE Wing-tat supported the provision of a promenade at the waterfront. Mr James TO supported the Study and opined that it should be commissioned as soon as practicable.

V Land Titles Bill
(LC Paper No. CB(1)760/98-99(02))

18. At the invitation of the Chairman, the Acting Secretary for Planning, Environment and Lands said that despite the curtailment of the Land Titles Bill (the Bill) in 1995, the Administration had maintained regular dialogue with the Law Society of Hong Kong (Law Society) with a view to addressing their concerns. A number of amendments had subsequently been made to the original Bill to allay the concerns of the Law Society. The proposed land title registration system would provide certainty of title to a property. The Administration was in the process of consulting the political parties and relevant professional bodies on the revised Bill.

19. The Land Registrar (LR) said that the Land Registry was embarking on a series of major changes to improve services and reduce costs. The major programme of change was set out in the Strategic Change Plan of which the central registration system and the land titles system registration were two key changes. Members of the Panel were briefed on the central registration system on 12 November 1998 and they fully endorsed the system. The land title registration system required the enactment of new legislation to replace the existing Land Registration Ordinance, Cap 128. The Administration planned to introduce the Land Titles Bill to the Legislative Council by the end of March 1999. With the aid of a computer, LR briefed members on the main features of the present deed registration system, the advantages of the latter system, and the proposed title registration system, and the major issues on the Land Titles Bill. (A copy of the briefing material was tabled at the meeting and circulated to members vide LC Paper No. CB(1) 779/98-99.)

20. Noting that under the proposed title registration system, a property would remain with the bona fide purchaser, instead of the original owner in fraudulent transfer, Dr TANG Siu-tong queried the rationale for this principle. He considered it more equitable that the original owner, being an innocent party, should get back the property, in particular where the value of the property might exceed the limit of indemnity. In this connection, the Chairman referred members to the submission from the Heung Yee Kuk which raised a similar concern. He sought clarification on the differences between the existing deed registration system and the proposed title registration system in dealing with fraudulent transfer.

21. In response, LR said that the principle of title indefeasibility which was the whole spirit of the new system had been adopted in many jurisdictions. The Deputy Principal Solicitor, Land Registry (DPS/LR) said that under the present deed registration system, the Land Registry had no role to play in determining the title to a property. In case of fraud, parties had to take civil proceedings to settle the dispute. Where the purchaser had no knowledge of the fraud and had paid value for the property, the Court might decide in favour of the purchaser. She used the famous WONG Chim-ying case to illustrate the problem of the present system. The husband, a bus driver, bought a property and his wife was the registered owner. The wife, without obtaining the consent of her husband, sold the property and disappeared with the money. The husband did not accept the transaction and refused to surrender the property. In the ensuing civil proceedings, the court ruled that the husband remained the property owner. The court decision was based on the consideration that before the transaction was completed, the purchaser had examined the property in person and was aware that the husband was an occupier. DPS/LR explained that the purchaser suffered in this case because deed registration per se did not confer ownership. Under the proposed land title registration system, registration of a person as owner would confer full and absolute title to the property concerned, subject only to any matters registered on the land register, certain overriding interests and rectification by the court. Persons claiming an interest in a property registered in the name of another person must register their claim against the property. Any unregistered claim against the property would be void. To address concern that it was unjustifiable to deprive persons of their unregistered rights in land simply through the implementation of the Bill, the Administration had amended the Bill to the effect that as long as the registered owner on the appointed day remained the registered owner and had not disposed of his/her interest to a purchaser for valuable consideration, persons having the unregistered interest could still enforce the said interest against the owner. LR stressed that it was important that people having an interest in a property should have it registered such that the land register would have as much information as possible. Since the Bill would only come into effect at least 12 months after its passage, there would be plenty of time to conduct publicity programmes to bring home its provisions to both local and overseas owners.

22. Referring to the WONG Chim-ying case, the Chairman sought further clarification on clause 19(2)(d) with regard to the preservation of unregistered interest against the owner. The Senior Assistant Legal Adviser (SALA) explained that after the appointed day, unregistered interest in the property would fall away and was not enforceable against the property but it would still be enforceable against the owner. Therefore, if a person had purchased a property in the name of another person after the appointed day and was concerned that the registered owner might sell the property, he/she could register a non-consent caution against the property. If the property was sold to a purchaser for value, he/she could then enforce his/her rights against the registered owner, but the property would be transferred to the purchaser under the provisions of the Bill.

23. Dr TANG Siu-tong was unconvinced of the need to introduce the Bill to change the existing system. He remained of the view that it should be left to the court to decide the title to a property in fraudulent transfer.

24. SALA said that the proposed land title registration system provided certainty of title. By examining the land register, prospective purchasers could find out charges and overriding interests that were registered. It would no longer be necessary for the purchaser's solicitor to investigate the title to a property by reviewing and approving all the title deeds.

25. Mr LEE Wing-tat pointed out that before the privacy law came into effect, it had been a common practice for owners of properties to release their personal particulars to a third party in the course of sale, purchase or letting of properties. Since the proposed Bill provided that the innocent purchaser would be the owner of the property in fraudulent transfer while the innocent vendor could only claim indemnity up to a certain limit for the loss, he queried the propriety of such an arrangement given that personal information of owners was not well protected prior to the operation of the privacy law. Moreover, it was not fair that the innocent vendor would have to move out from his/her dwelling place through no fault of his/her own. Mr LEE said that although the owner would be indemnified, there might be sentimental attachment to a property which could not be compensated in monetary terms.

26. LR said in response that it would be difficult to assess in monetary terms the value of a property if sentimental attachment was taken into account. Each case would be considered on its own merits. The Administration proposed to set the ceiling of compensation at $20 million per case. This ceiling was agreed upon by the then Bills Committee on Land Titles Bill in 1994. Recent valuations on properties indicated that this limit would cover 99.5% of all properties. For properties in excess of $20 million, it could be assumed that both the vendor and the purchaser should be in a position to ensure that appropriate legal advice had been obtained and that all title problems had been resolved. An upper limit had to be set to avoid massive claims for indemnity.

27. Mr LEE Wing-tat was concerned about the possibility of collusion between vendors and purchasers to seek indemnity and enquired whether such overseas cases existed. LR said that the Administration was conducting a survey on indemnity funds overseas. He was not aware of cases involving collusion between vendors and purchasers. Based on the information available, the number of claims against indemnity funds were small.

28. On Mr HO Sai-chu's enquiry about the levy for the indemnity fund to be set up, LR explained that the Administration had not finalized the arrangement but the amount of levy would likely to be small, possibly around $100 per application for registration.

29. Mr HO Sai-chu said that he was aware that jurisdictions differed in the way of dealing with land ownership in fraudulent transfer. Some jurisdictions conferred land ownership to the innocent vendor while others to the innocent purchaser. He enquired if any research had been done in this respect. In response, LR said that the Administration was collecting statistics on overseas title registration systems.

30. Mr Andrew CHENG Kar-foo highlighted the Law Society's concern that some of the errors made in conveyancing of property were a result of omissions or mistakes on the part of the Land Registry. LR assured members that the Land Registry seldom made mistakes. In its 154 years of service, the Land Registry had made one mistake only.

31. Mr Andrew CHENG Kar-foo expressed reservation about the proposed abolition of the subrogation rights by the Professional Indemnify Insurer against the Government under new clause 78(4), which was strongly objected by the Law Society. LR stated that there had not been any detailed discussion with the Law Society on the provision yet but it was likely that this would be examined in future discussion. In any case, after the Bill had been introduced into the Legislative Council, a Bills Committee would certainly be set up and the Law Society would possibly be invited to give comments.

32. On consultation with the Law Society, LR said that regular dialogue had been maintained and had become more frequent in the past six months. The draft Bill had been made available to the Law Society. Their responses would be set out in the consultation report on the Bill. The Law Society had always supported in principle a land title registration system which would bring about many advantages to the average members of the public engaged in sale/purchase of property. Their main concern was about the "midnight conversion" and they preferred a gradual change. They were also concerned about criminalization of reckless acts in conveyancing of property by solicitors.

33. Concluding the discussion, the Chairman called on the Administration to fully consult the relevant parties before introducing the Bill into the Legislative Council.

VI Any other business

34. There being no other business, the meeting ended at 4:00 pm.

Legislative Council Secretariat
25 March 1999