20 February 2013
We are holding a press conference today to make the following observations regarding Cheung Kong’s recent sale of The Apex Horizon hotel units to individual buyers:
– Cheung Kong’s newspaper ad suggests that you can buy a flat of a certain size with all these different facilities for a relatively cheap price, but the fine print at the very bottom of the ad says that the buyer does not gain exclusive possession. This means buyers do not own a particular flat in the same way that traditional owners do, and buyers may find that they have not purchased what they thought they purchased;
– Buyers have certainly bought a share of the hotel but it is not clear what “share” that is. They may find that they have in fact purchased what is equivalent to a share of a company and that they do not actually own or possess any particular unit;
– Not having exclusive possession of any particular unit means that the owner may be kicked out of any unit he occupies at any time. He may have no priority over other hotel guests and may be refused a unit if the hotel is already full. It is not clear that the exact nature of the transaction and the risks involved have been fully explained to the buyers, and there may be a case for misrepresentation by the developer in question;
– Under section 8(3) and 10(a) of the Hotel and Guesthouse Accommodation Ordinance (“the Ordinance”), the Secretary for Home Affairs can suspend or even cancel a licence if it appears to him that “the operation, keeping, management and other control of the hotel or the guesthouse would not be under the continuous and personal supervision of the person to whom the licence is issued”;
– Under section 18 of the Ordinance, public officers are authorised to make repeated inspections without producing a warrant, at least partly to enforce the above provisions, i.e. to ensure that the operation and control of the hotel is under continuous and personal supervision of the licencee rather than individual unit owners;
– Under section 20 of the Ordinance, in case of clear and repeated violation of the above provisions, the relevant authorities are empowered to make an order for closure of the hotel and cessation of the use of the premise as a hotel, forcibly removing all the buyers and hotel guests alike from their units.
We urge the Government to clarify the legal questions involved so that buyers and the public are more aware of their rights under these circumstances. The Civic Party is going to follow up on this closely in the Legislative Council.