J & V LTD v. ISS EASTPOINT PROPERTY MANAGEMENT LTD AND ANOTHER

J & V LTD v. ISS EASTPOINT PROPERTY MANAGEMENT LTD AND ANOTHER

The DMC did not authorise raising a lump-sum Litigation Fund for unexpected litigation under Clause D(1)(d); such expenditure falls within a contingency fund authorised by BMO s20(2) and apportioned by owners' undivided shares under s22(2), so the corporation validly raised the Fund and the Applicant was liable to contribute. However Clause F(4) only permits registration of a charge for sums due under the DMC (MF and AC); the registered Charge related only to the Litigation Fund (not sums specified under the DMC) and therefore was not chargeable under Clause F(4) and must be vacated. The Applicant proved overpayment issues but had acquiesced and the corporation changed position in good...

Citation
J & V LTD v. ISS EASTPOINT PROPERTY MANAGEMENT LTD AND ANOTHER
Parties
Applicant: J & V LIMITED; 1st Respondent: ISS EASTPOINT PROPERTY MANAGEMENT LIMITED; 2nd Respondent: THE INCORPORATED OWNERS OF FOOK CHEONG BUILDING
Court
Lands Tribunal
Jurisdiction
Hong Kong
Judgment Date
10 August 2010
Case Number
LDBM242/2009
Procedural Posture
Building Management Application (lands Tribunal) / Judgment
Outcome
Application partly allowed and partly dismissed: Charge vacated; Applicant ordered to pay litigation fund; refund and damages claims dismissed; directions given on MF/AC calculations; injunction limited to preventing registration of same Charge; no costs order nisi.
Legal Topics
Contingency Fund, Deed of Mutual Covenant, Building Management Ordinance, Registration of Charge, Management Fees, Air Conditioning Charges, Estoppel, Acquiescence, Change of Position, Unjust Enrichment, Injunctions, Damages
Source Language
EN
Building Management Property Law Land Law Equity Contract Restitution/unjust Enrichment Contingency Fund Deed of Mutual Covenant +10 more

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Parties

J & V LIMITED

Applicant

ISS EASTPOINT PROPERTY MANAGEMENT LIMITED

1st Respondent

THE INCORPORATED OWNERS OF FOOK CHEONG BUILDING

2nd Respondent

Procedural Posture

Building Management Application (lands Tribunal) / Judgment

Legal Issues

  1. 1 Whether the Litigation Fund could be raised under the DMC or under the BMO as a contingency fund
  2. 2 Whether the Litigation Fund contribution was chargeable under DMC Clause F(4) and whether the registered charge was lawful
  3. 3 Whether Applicant overpaid management fees and air-conditioning charges and whether a refund is payable

Ratio Decidendi

The DMC did not authorise raising a lump-sum Litigation Fund for unexpected litigation under Clause D(1)(d); such expenditure falls within a contingency fund authorised by BMO s20(2) and apportioned by owners' undivided shares under s22(2), so the corporation validly raised the Fund and the Applicant was liable to contribute. However Clause F(4) only permits registration of a charge for sums due under the DMC (MF and AC); the registered Charge related only to the Litigation Fund (not sums specified under the DMC) and therefore was not chargeable under Clause F(4) and must be vacated. The Applicant proved overpayment issues but had acquiesced and the corporation changed position in good...

Court Disposition

Application partly allowed and partly dismissed: Charge vacated; Applicant ordered to pay litigation fund; refund and damages claims dismissed; directions given on MF/AC calculations; injunction limited to preventing registration of same Charge; no costs order nisi.

Orders

  • The Charge against the Premises to be vacated forthwith by the 1st Respondent
  • Injunction restraining the 1st Respondent from registering the Charge concerning the Litigation Fund to be contributed by the Applicant