Papers cast doubt on C.Y. explanation

Chief executive-elect Leung Chun-ying might have been aware of the existence of illegal structures on his two houses on The Peak when he bought them, a clause in the sale and purchase agreement suggests.

According to a clause in the agreement, signed by Leung in 1999, he agreed to 'waive and relinquish all [his] rights to raise any requisition on the state, condition and structure of the property ... or on the existence of the internal partitions in, and additions and alterations to, the property (if any) whether [they] are illegal, unauthorised or otherwise'.

Ambrose Lam San-keung, a lawyer specialising in property transactions, said it was normal to put such a clause into a purchase agreement if a house was sold by auction or tender. In this case, it did not indicate whether vendor and purchaser were aware of illegal structures. However, if it was sold through other means, such as through an agent, or a private deal, there was a possibility both sides were aware of such infringements.

'It is usually the vendor, who is in a stronger bargaining position, that puts in the clause to forbid the buyer to claim any compensation or withdraw from the deal because of any illegal structures discovered in future,' Lam said.

It is unclear through what means Leung purchased the houses at No4 Peel Rise. According to the Land Registry, he bought the two houses in 1999 for HK$66 million, directly from developer Housing Development.

Leung has claimed the structures were already in the houses when he bought them, and that the houses were occupied by the developer after they were built in 1992. A director for the developer, Robert Lau Siu-kit, declined to respond to enquiries. It is also uncertain if the houses were rented after the developer moved out and before being sold to Leung.

Grace Fung Sin-yu and Peter Lo Chi-lik, the lawyers who acted for the vendor and for Leung respectively, also declined to answer media inquiries.

Meanwhile, Labour Party chairman Lee Cheuk-yan restated yesterday that he would press for a debate on the scandal at tomorrow's Legislative Council session and call for a vote of confidence soon on Leung.

Lau Kong-wah, a Democratic Alliance for the Betterment and Progress of Hong Kong lawmaker, said his party would not support the vote. 'I cannot accept Leung's explanation that the unauthorised alterations stem from pure negligence. He needs to explain himself .'