EAQE 學習筆記

The public's expectations of the estate agency profession encompass four dimensions: possessing professional knowledge, providing accurate information, diligently carrying out the client's mandate, and refraining from exerting undue influence on clients. All four are reasonable public expectations.

• According to syllabus section 1.3.2, "technical factors" affecting property prices include: interest rate levels, economic data indicators, seasonal fluctuations and mortgage-related policies.
• Interest rates directly affect mortgage interest costs and overall borrowing costs in the market, falling within the scope of technical factors (s. 1.3.2).
• Mortgage-related regulations (including loan-to-value ratio caps and stress test requirements) are also classified as technical factors (s. 1.3.2).
• Macroeconomic data indicators (such as GDP growth rate and unemployment rate) are categorised as "economic indices" and fall within the scope of technical factors (s. 1.3.2).
• Government land supply arrangements and land sale policies fall under the category of "housing policy and land policy" (s. 1.3.1) and are not technical factors. Therefore, (ii) is not included.

• Section 4 of the Estate Agents Ordinance (Cap. 511) establishes the Estate Agents Authority as a statutory body under that Ordinance.
• The functions of the EAA include issuing licences to qualified estate agents and salespersons, formulating codes of practice and standards, and investigating and handling complaints against licensees (Cap. 511, s. 7).

• The Estate Agents Authority was established under Section 18 of the Estate Agents Ordinance (Cap. 511) as a statutory body, not a government department. Its operating funds come primarily from licensing fees and other charges paid by the industry, not entirely from Government general revenue.
• Under Section 23 of the Estate Agents Ordinance (Cap. 511), the functions of the EAA include regulating the estate agency trade, issuing and managing licences, conducting disciplinary proceedings, and promoting standards of conduct in the industry.

• Under the general principles of agency law and the Estate Agents Ordinance (Cap. 511), estate agents owe their clients duties of loyalty, disclosure, and diligence, and must act in the client's best interests.
• The Estate Agents (Licensing) Regulation (subsidiary legislation under Cap. 511) and the Code of Ethics expressly prohibit estate agents from accepting any secret profit from the other party to a transaction without the client's consent. Such conduct constitutes a serious breach of conduct.

• The Estate Agents Authority (EAA) is a statutory body established under Section 3 of the Estate Agents Ordinance (Cap. 511) and is NOT a government department; its members are not civil servants.
• As an independent statutory body, the EAA is responsible for issuing licences to estate agents and salespersons, setting codes of practice and handling complaints to regulate the estate agency industry in Hong Kong.

• Under the Estate Agents Ordinance (Cap. 511) and the EAA's Practice Circulars, a licensee's duty of good faith and professional conduct obligations to clients extend throughout the entire transaction process, including the formal agreement stage, and do not automatically terminate upon the signing of a provisional agreement.
• The EAA has the authority to impose disciplinary sanctions on licensees for misconduct, including warnings, fines, and licence revocation, and may seek relevant legal remedies from the court in cases of continued breach.

• Any monies received on behalf of a client must be deposited into a trust account opened at an authorised institution (Practice Regulations, reg. 12(3)).
• Such monies may only be applied to: (a) make payment to the relevant client, or (b) make payment in accordance with prior written instructions given by the client (Estate Agents Ordinance, s. 43(3)(c)).
• An agent must issue a written receipt to the client 'immediately' upon receipt — there is no fourteen-day grace period (Practice Regulations, reg. 12(2)(a)).
• A copy of the receipt must be retained for at least three years (Practice Regulations, reg. 12(2)(b)).

• Under s. 30(1) of the Estate Agents Ordinance, the disciplinary sanctions available to the Authority include: admonition/reprimand, attachment of conditions to the licence, suspension of the licence (not exceeding 2 years), revocation of the licence, and a fine (up to a maximum of HK$300,000).
• The statutory maximum period of suspension is 2 years, not 3 years; accordingly, the three-year suspension in option (iii) does not conform with the Ordinance and is incorrect.
• A fine of HK$100,000 does not exceed the statutory maximum of HK$300,000; option (ii) is therefore correct.

• A licensee is obliged to produce to the investigator records that the investigator considers relevant to the matter under investigation (s. 28(5)(a)).
• A licensee must provide the investigator with an explanation of any documents produced (s. 28(5)(b)).
• Searching a licensee's private residence is not a requirement prescribed under the investigation procedures in the Estate Agents Ordinance.
• Only a court or magistrate (and not the Authority itself) may order a convicted licensee to bear the costs of the investigation (s. 28(8)(a)).

• Under s. 19(2)/s. 21(3) of the Estate Agents Ordinance, the statutory factors to be considered in determining whether a person is 'fit and proper' include: whether the person is an undischarged bankrupt, whether the person is mentally disordered, whether the person has been convicted of an offence involving fraud/dishonesty/moral turpitude, whether the person was a director of a disqualified company, and whether the person has been convicted of an offence under the Ordinance and sentenced to imprisonment.
• Possession of relevant work experience is not a statutory factor specified in the Ordinance.

• Under s.14(1)(b) of the Licensing Regulation, letters and related documents must state: the licence number or business details statement number, the business name, and the place of business.
• The address as stated in the Business Registration Certificate is not a required item to be stated on letters.

• All benefits must be confirmed in writing to the prospective purchaser, with the relevant terms and conditions and manner of provision clearly stated (Practice Circular 13-04 (CR), para. 33).
• Licensees must disclose benefit details to prospective purchasers and indicate whether the benefit is from the vendor or the estate agency company (para. 32).
• The Practice Circular does not require licensees to advise prospective purchasers to refrain from disclosing benefits to the vendor.

• Concealing one's interest in a property from the client breaches the obligation to disclose monetary or other material benefits under para. 3.6.2 of the Code of Ethics.
• Allowing personal interest to conflict with duties owed to the client breaches the requirement to treat all parties to the transaction fairly and impartially under para. 3.4.1 of the Code of Ethics.
• The circumstances described are not directly related to the provisions on performing duties with due care and diligence or carrying out instructions under the estate agency agreement.

• Making a false representation regarding a cash rebate breaches the requirement to maintain honesty, fidelity and integrity under para. 3.3.1 of the Code of Ethics.
• Disclosing a client's personal data without consent may contravene the Personal Data (Privacy) Ordinance (Cap. 486), thereby breaching para. 3.1.1 of the Code of Ethics, which requires licensees to avoid unlawful conduct.
• Spreading false statements that damage the reputation of another agency breaches para. 3.7.1 of the Code of Ethics.
• Referring a firm of solicitors to a client at the client's own request does not constitute a breach of the Code of Ethics.

• Section 36(1)(a)(vi) of the Estate Agents Ordinance (Cap. 511) requires an estate agent to disclose any pecuniary or other material interest held in the property.
• Paragraph 3.6.2 of the Code of Ethics requires the agent to make full disclosure to all parties of any pecuniary or other material interest obtained in connection with the property.
• The Conveyancing and Property Ordinance and the Unconscionable Contracts Ordinance are not relevant to this disclosure obligation.

• The prescribed forms (Forms 3–6) apply only to the sale and letting of residential properties.
• The sale or letting of a residential property together with a car parking space still requires the use of the prescribed forms.
• Transactions that do not require prescribed forms (Regulation 3(4)) include: the sale or letting of a car parking space alone; the letting of a non-self-contained residential unit lacking independent facilities; and transactions involving non-residential properties (e.g. shops, offices).

• The duties of an agent as set out in Form 3 include: (a) marketing and promoting the property for the vendor; (b) collecting relevant information about the property; (c) arranging for prospective purchasers to view the property; (d) conducting negotiations with all parties and submitting all offers to purchase; and (e) assisting in the conclusion of the agreement for sale and purchase.
• The following matters are not within the scope of duties under Form 3: proactively investigating a purchaser's background, the agent personally inspecting the property, conducting bankruptcy searches on behalf of the purchaser, and providing a valuation of the property.

• Money received by a salesperson on behalf of a client must be paid into the trust account opened by the licensed estate agent (i.e. the employing agency) at an authorised institution (Regulation 12(3) of the Estate Agents (Estate Agency Practice) Regulations).
• Such money must not be paid into the agency's general account, any individual's personal account, or a solicitor's trust account.

• An estate agent must obtain prior written consent from the vendor before publishing any advertisement for a residential property (Regulation 9(2) of the Estate Agents (Estate Agency Practice) Regulations).
• Option C is incorrect because it implies that an estate agent may publish an advertisement without prior consent from the vendor, provided the vendor has not expressly prohibited it — this is contrary to the Regulations.
• Advertisement content must not contain any false or misleading statement in a material particular (Regulation 9(1)).
• An advertisement for a residential property intended for subletting must indicate that the property is for sub-letting purposes (Regulation 9(4)).
• An advertisement must include the estate agent's licence number or the number of the Particulars of Business (Regulation 14(1)(c) of the Estate Agents (Licensing) Regulation).

• Under regulation 5(2) of the Estate Agents (Conduct) Regulations, a salesperson must disclose two items to a client before commencing estate agency work: (a) that he or she holds a licence as a salesperson; and (b) his or her licence number.
• The year of first licensure, the expiry date of the licence, and the number of transactions completed are not items required by law to be proactively disclosed.

• A licensed estate agent seeking to recover commission in respect of a residential property must first have entered into a prescribed form of estate agency agreement with the client; without such an agreement, no claim for commission may be brought (section 45(1) of the Estate Agents Ordinance, Cap. 511).
• Even if a commission clause is included in the provisional agreement for sale and purchase, an estate agent cannot recover commission if no prescribed estate agency agreement has been duly signed.
• There is no requirement to lodge the provisional agreement for sale and purchase at the Land Registry, nor to submit the estate agency agreement to the Estate Agents Authority for approval, as preconditions to bringing a claim.

• Where the saleable area is obtainable from the Rating and Valuation Department or the first assignment agreement, the saleable area must be stated in the advertisement (Practice Circular 12-02 (CR)).
• The advertisement must clearly identify the stated area as the 'saleable area'.
• There is no requirement to state the gross floor area concurrently, nor is it necessary to indicate the source of the floor area information.

• Under the Estate Agents Ordinance (Cap. 511), a manager of an estate agency office must hold an estate agent's (individual) licence, not merely a salesperson's licence.
• Chi-yuen holds only a salesperson's licence and therefore does not meet the licensing requirement to act as a manager.

• Under the Estate Agents Ordinance (Cap. 511), 'advertisement' is broadly defined to cover any form of promotion or publicity relating to estate agency work, including posters, printed price lists in publications, and leaflets distributed to letterboxes.
• All three scenarios — a display poster, a magazine price list, and a distributed leaflet — fall within the definition of 'advertisement' under the Ordinance.

• Under the Estate Agents (Conduct) Regulations, once an estate agency agreement has been concluded with the vendor, the agent is required to possess all three categories of property information: the unexpired term of the government lease, the year of completion of the property, and the approved use of the property.
• All three items are mandatory — none may be omitted.

• Using a name in the course of estate agency work that differs from the name on one's licence constitutes a criminal offence under the Estate Agents Ordinance (Cap. 511).
• Providing misleading information to an appointed investigator during an Estate Agents Authority investigation constitutes a criminal offence under the Estate Agents Ordinance (Cap. 511).
• Publishing a property advertisement without the vendor's prior written authorisation is a regulatory breach but does not constitute a criminal offence under the Estate Agents Ordinance (Cap. 511).

• Under the Estate Agents Ordinance (Cap. 511), an estate agent has a statutory duty to disclose to the client full details of any pecuniary or other beneficial interest that the agent holds in respect of the property concerned.
• Referral of solicitors, introduction of mortgage lenders, arranging insurance, and advising on independent valuations are not statutory obligations imposed on estate agents under the Ordinance.

• An undischarged bankrupt may fail to satisfy the 'fit and proper person' requirement under the Estate Agents Ordinance (Cap. 511).
• A person convicted of a fraudulent or deceptive offence — such as obtaining property by deception under the Theft Ordinance (Cap. 210) — may fail to satisfy the 'fit and proper person' requirement.
• A minor traffic conviction (e.g. careless driving resulting in a fine) would generally not affect a person's 'fit and proper person' status under the Estate Agents Ordinance (Cap. 511).

• Under the Estate Agents Ordinance (Cap. 511), the manager appointed to be responsible for the effective and independent management of an estate agency office must hold an estate agent's (individual) licence — statement (ii) is correct.
• The obligation to disclose any beneficial interest in the property applies to all licensees, including both estate agents (individual) and salespersons — statement (i) is incorrect.
• A licensed salesperson may also sign a prescribed estate agency agreement on behalf of an estate agency firm — statement (iii) is incorrect.

• An applicant for a salesperson's licence must be aged 18 or above, be a fit and proper person, and hold Form 5 or equivalent educational qualifications.
• The validity period of a pass in the specified qualifying examination is 12 months, not 6 months. Therefore, condition (i) is incorrectly stated and does not reflect the actual requirement.

• Making a false representation to a client to induce them to enter into a transaction is a breach of the duty to protect the client's best interests and the duty to serve clients honestly and faithfully.
• The fair competition principle under the Code of Ethics primarily governs competitive conduct between licensees, and is not directly applicable to false representations made to a client.

• The Code of Ethics issued by the Estate Agents Authority covers all three provisions: serving clients honestly, faithfully and with integrity; avoiding conduct that damages the reputation of the industry; and exercising reasonable care and diligence in performing duties.
• All three provisions are expressly stated in the Code of Ethics and apply to both estate agents and salespersons.

• A salesperson who knowingly makes a false statement to a client may be in breach of the duty not to make misrepresentations under the Estate Agents Ordinance (Cap. 511).
• Deliberately concealing material facts and making false statements to a client constitutes a breach of the Code of Ethics requirement to serve clients honestly, faithfully and diligently.
• Merely having knowledge of a special circumstance is not in itself a breach; the breach arises from the act of making a false statement about that circumstance, which is why (ii) does not correctly characterise the nature of the violation.

• Under the relevant Practice Circular on order at first-hand residential property sales venues, licensees and estate agents must not stop passing vehicles or put up banners in public places.
• Distributing promotional leaflets to prospective purchasers is generally considered acceptable conduct and is not prohibited by the Practice Circular.

• Under the Estate Agents (Conduct) Regulations (Cap. 511C), an estate agent acting for a buyer is required to personally accompany the buyer when inspecting a property.
• The agent must also obtain the seller's consent before arranging a property inspection for the buyer.
• Preparing a furniture list for the buyer prior to inspection is NOT a statutory duty prescribed under the Practice Regulations.

• Under the Practice Regulations, the requirement to use a prescribed form of estate agency agreement applies only to the assignment of second-hand residential properties.
• The sale and purchase of car parking spaces is not subject to the prescribed form requirement.
• The first sale of newly constructed residential units (i.e., primary market sales) is also not within the scope of the prescribed form requirement.

• Under the Practice Regulations, an estate agent publishing an advertisement must ensure that the contents of the advertisement are accurate and truthful.
• The agent must obtain written authorisation from the owner before publishing any advertisement for the property.
• The asking price stated in the advertisement must be in accordance with the owner's instructions.
• There is no requirement under the Practice Regulations for the asking price to reflect the market valuation of the property.

• Under the Practice Regulations, a salesperson must disclose to the client, before commencing any estate agency work, that he/she is a licensed salesperson and provide his/her licence number.
• The schedule of accommodation number of the employing estate agency company is not a statutory disclosure requirement under the Practice Regulations.

• Under the Practice Regulations, where a buyer is not represented by a solicitor, the licensee must explain the different types of agency appointment and their legal effects before entering into an estate agency agreement.
• The licensee must also explain each and every term and condition in the estate agency agreement to the buyer.
• Where the buyer does not understand any term or condition, the licensee must advise the buyer to seek independent legal advice.
• All three duties are statutory obligations under the Practice Regulations when the client is unrepresented by a solicitor.

• Form 4 (Estate Agency Agreement for purchase of property) sets out specific duties owed by an estate agent to a buyer.
• Duties under Form 4 include: collecting property information, arranging inspections, conducting negotiations, and assisting in the conclusion of a sale and purchase agreement.
• Arranging mortgage financing for the buyer is NOT a prescribed duty under Form 4 and falls outside the agent's statutory obligations under that agreement.

• Under the Practice Regulation, a licensed estate agent must enter into an estate agency agreement (Form 3) with the vendor before placing any advertisement for the vendor's residential property.
• Since Wan Wan Properties placed the advertisement on 9 January 2013, the Form 3 must have been signed with Po-shan on or before the date of advertisement (i.e. 9 January 2013).

• (i) Under the Estate Agents Ordinance (Cap. 511), a licensed salesperson must disclose his or her licence number to the client when conducting business.
• (ii) The private additional cash reward from the vendor constitutes a secret commission. Under the Code of Ethics, the agent must disclose this to both parties to the transaction.
• (iii) Under the Practice Regulation, an estate agent must disclose to the purchaser all encumbrances currently subsisting on the property.
• (iv) The vendor's personal reason for selling is a private and confidential matter. The agent is under no obligation to disclose it and should not reveal it to the purchaser. Therefore, (iv) is not within the scope of required disclosure.

• (i) Under the Practice Regulation, a licensee must provide the purchaser with a copy of the land search record before the purchaser signs the Provisional Agreement for Sale and Purchase. Failure to do so constitutes a breach.
• (ii) Publishing an advertisement at an asking price that differs from the price instructed by the principal breaches the agent's duty and constitutes a violation.
• (iii) Posting advertisements on street lamp posts constitutes illegal fly-posting, which is a violation.
• (iv) Signing Form 4 with the purchaser on behalf of the estate agency company is a normal statutory procedure and does not constitute a breach.
• (v) Giving the purchaser advice on whether the open kitchen constitutes an unauthorised building alteration without first verifying the facts amounts to a misleading representation and constitutes a violation. Therefore, the acts subject to disciplinary action are (i), (ii), (iii) and (v).

• (i) Under the Estate Agents (Conduct) Regulations, an estate agent must provide a copy of the land search to the purchaser before the purchaser signs the provisional agreement. Tin Long failed to fulfil this obligation, and the complaint is well-founded.
• (ii) The land register records show that the property is subject to a mortgage, a building order and a memorandum of charge. Tin Long's representation to Chi-ling that there were 'no subsisting encumbrances' constitutes a serious misrepresentation, and the complaint is well-founded.
• (iii) Arranging for a client to sign a provisional agreement with incomplete or blank terms is a serious breach of conduct, and the complaint is well-founded. All three complaints are well-founded.

• Under the Practices Regulation, when an estate agent acts for a vendor in the sale of a residential property, the agent must set out the prescribed particulars in the Property Information Form (Form 1). These include: (i) detailed particulars of the current title to the property; (ii) the saleable area of the property (as sourced from the Rating and Valuation Department); and (iii) the year in which the property was completed.
• Item (iv), the market valuation of the property, is not among the prescribed particulars required to be disclosed under the Practices Regulation, and therefore does not form part of the information that must be obtained.

• (i) Incorrect: Upon the death of a tenant in common, a grant of probate must first be obtained before the executor can sell the property. A death certificate and a will alone are insufficient to establish the authority to sell.
• (ii) Incorrect: During the validity period of a sole agency agreement, the owner may still be liable to pay commission to the original sole agent even if the agent has not introduced a purchaser. The absence of an introduction does not automatically discharge the commission obligation.
• (iii) Incorrect: A building order is a subsisting encumbrance that must be disclosed in Form 1 and cannot be omitted.
• (iv) Incorrect: Unilaterally issuing a notice of termination may constitute a breach of contract, and the owner may still bear the corresponding legal liabilities. All four pieces of advice may be incorrect.

• (i) Chi-ming's advice to Mr. Lam that he could terminate the sole agency without paying commission may not be legally accurate and constitutes a misleading representation, potentially breaching the duty of honesty under the Code of Ethics.
• (ii) Agreeing to deliberately omit the building order from Form 1 clearly breaches the mandatory disclosure requirements under the Practice Regulation and constitutes a serious violation.
• (iii) Relaying the purchaser's offer to the vendor is part of the agent's normal duties and does not constitute a breach.
• (iv) Suggesting the inclusion of a vacant possession clause in the Provisional Agreement for Sale and Purchase is standard industry practice and does not constitute a breach.

• (ii) A building order is a material encumbrance that directly affects mortgage applications and the use of the property. The agent must disclose this to the purchaser.
• (iii) A memorandum of charge (e.g. for outstanding management fees) constitutes a subsisting encumbrance. The agent has a duty to disclose this to the purchaser.
• (iv) Advising that the deposit be placed in a solicitor's trust account to protect the purchaser's interests is appropriate advice that the agent should provide.
• (i) Informing the client of the debt recovery arrangements for overdue commission also forms part of the agent's duty to advise, so that the client understands the consequences of non-payment. All four items are matters on which the agent should advise the purchaser.

• A licensed estate agent must enter into a written estate agency agreement with the client before commencing any agency work (Practice Regulation, section 6(1)).
• If the client refuses to sign the agreement, the agent must record the refusal in writing, but there is no requirement for the agent to immediately cease all agency work. Statement (ii) is therefore incorrect.
• The written agreement must be in the prescribed form specified by the Estate Agents Authority (e.g. EAA-1 or EAA-3).
• The written agreement must specify the amount of commission or the method of its calculation (Practice Regulation, section 6(2)).

• An estate agent has a duty to make full disclosure of any potential conflict of interest to both parties to the transaction (Code of Ethics, section 6).
• In a dual agency situation, the agent must clearly explain to both the landlord and the tenant the nature of the agency relationship and the relevant conflict of interest.
• The agent should not proceed with the transaction until both parties have given their informed consent; otherwise, the agent may breach the Code of Ethics (section 2.4.6).
• Merely stating one's position in the agreement does not constitute sufficient disclosure. The agent must ensure that both parties genuinely understand the conflict of interest involved. Statement (iv) is therefore incorrect.

• Offences under s. 55(1) apply to all persons (including unlicensed persons) and cover carrying on estate agency work without a licence, making false statements in licence applications, and obstructing the EAA in discharging its statutory functions (s. 2.3.14.1).
• Offences under s. 55(2) apply only to licensees, such as failure to comply with conditions attached to a licence (s. 2.3.14.2).
• A person convicted of carrying on estate agency work without a licence is liable to a fine and imprisonment.
• (iii) Failure to comply with licence conditions is an offence under s. 55(2) applicable to licensees only and does not fall within the scope of s. 55(1) offences against any person.

• Information in an advertisement must be truthful and must not contain false or misleading representations, failing which the agent may contravene the Code of Ethics and the Practice Regulations (s. 2.5.4).
• The advertisement must display the estate agent's licence number so that the public can identify the publisher (s. 2.3.9.8).
• The estate agent must obtain the express authorisation of the client (owner/vendor) before publishing an advertisement; advertising a property without proper appointment is prohibited (s. 2.5.2).
• Using expressions such as "guaranteed profit" or "deal assured" constitutes false or misleading representation and is strictly prohibited under the advertising regulations (s. 2.5.4).

• Under section 43 of the Estate Agents Ordinance (Cap. 511), a licensee who receives any money on behalf of or for a client must deposit it into a trust account maintained for clients; there is no minimum threshold amount for this requirement.
• Under rule 12 of the Estate Agents Practice (General Duties and Hong Kong Residential Properties) Regulation (Cap. 511C), a licensee must issue a receipt to the payer immediately upon receiving any money and must retain a copy of the receipt for at least 3 years.

• Under Cap. 511C r.5(1), a licensee (acting for the vendor or the purchaser) must provide a duly completed Property Information Form to a prospective purchaser before conducting a property inspection or before presenting any document or information about the property to the prospective purchaser, whichever is the earlier.
• The purpose of the Property Information Form is to ensure that prospective purchasers are provided with sufficient and accurate information about the property before making a purchasing decision, including title, outstanding encumbrances, outstanding works orders, and other material facts.
• The licensee acting for the vendor is responsible for ensuring that the information in the Property Information Form is as complete and accurate as possible; if errors or omissions are discovered, corrections must be made and relevant parties notified promptly.

• Under section 38 of the Estate Agents Ordinance (Cap. 511), a licensed estate agent (corporate) must arrange for a person holding an individual estate agent's licence to be responsible for the management and supervision of business at each office, and that person's licence must specify that he/she is authorised to discharge those responsibilities at the relevant office.
• A person holding only a salesperson's licence does not meet the statutory qualification to act as branch manager, as section 38 expressly requires the person responsible for managing and supervising an office to hold an individual estate agent's licence, not a salesperson's licence.
• A licensed estate agent (corporate) must ensure that a qualified individual licence holder is stationed at and exercises effective control over each office; occasional visits do not satisfy the requirements of the Ordinance.

• Under the Estate Agents (Estate Agency Agreements) Regulation, an estate agent must enter into a written agency agreement with the client (including the vendor) before providing estate agency services. The agreement must contain all prescribed terms, including the amount or method of calculating any commission and other remuneration.
• Any commission or remuneration arrangement (such as a verbally promised bonus) that is not stated in the written agency agreement cannot be legally claimed by the estate agent from the client.

• Under the Estate Agents Ordinance, any person who carries out estate agency work without holding a valid licence commits an offence and may be prosecuted and subject to criminal sanctions; there is no grace period that allows a licensee to continue practising after their licence has lapsed.
• Once a licence expires, the licensee must first obtain a new valid licence before resuming estate agency work; the EAA has no obligation to proactively notify the licensee to cease business, as the responsibility for compliance rests with the licensee.

• When an estate agent receives money for or on behalf of a client, the money must be deposited into a trust account and must not be placed into a general business account or personal account.
• An estate agent must issue a receipt to the payer immediately upon receiving money, and must retain a copy of that receipt for a minimum of 3 years.

• Under section 38(1) of the Estate Agents Ordinance (Cap. 511), a licensed estate agent must appoint a person who holds an estate agent's (individual) licence as manager for each of its places of business to exercise effective control over that place of business.
• A salesperson's licence holder is not qualified to act as a branch manager (Cap. 511 s.16 and s.38); the branch manager must hold an estate agent's (individual) licence.
• Effective control means the manager must manage and supervise the business operations at that place of business during normal office hours, not merely conduct occasional visits.

• Under regulation 5 of the Estate Agents Practice (General Duties and Residential Properties) Regulation (Cap. 511C), a licensed estate agent must include in the property information form details such as the year of completion, restrictions on use, rates and Government rent, and saleable area, but there is no requirement to disclose the vendor's original purchase price.
• The purpose of the property information form is to provide the purchaser with material information about the condition and particulars of the property itself before making a purchase decision, not the vendor's transaction history. The vendor's original purchase price is private commercial information and is not a statutory disclosure item.

• Under section 43 of the Estate Agents Ordinance (Cap. 511), money received by a licensed estate agent on behalf of another person must be deposited into a trust account maintained at an authorized institution as soon as practicable; the Ordinance does not prescribe a specific 7-day or 14-day deadline for such deposit
• The trust account must be opened and maintained in the name of the licensed estate agency company (not the individual licensee) at an authorized institution (i.e. a bank), and the money must not be deposited into a general business account

• Under section 30 of the Estate Agents Ordinance (Cap. 511), the maximum fine the Disciplinary Committee may impose on a licensee found guilty of disciplinary offence is HK$300,000.
• Under section 30, the Disciplinary Committee may suspend a licensee's licence for a maximum period of 2 years.
• Other disciplinary sanctions available to the Committee include: reprimand, adding or varying licence conditions, revocation of licence, and ordering payment of costs.

• Under section 32 of the Estate Agents Ordinance (Cap. 511), a licensee aggrieved by the decision of the Disciplinary Committee may appeal to the Secretary within 21 days of the decision
• The appeal tribunal shall consist of at least 3 members, and under section 32(9), the decision of the appeal tribunal shall be final
• Under section 30, sanctions that the Disciplinary Committee may impose include reprimand, addition/variation of licence conditions, suspension of licence (up to 2 years), revocation of licence, fine (up to $300,000), and order to pay costs

• Under s.45 of the Estate Agents Ordinance (Cap. 511), a licensed estate agent handling a residential property transaction must sign a prescribed estate agency agreement (Form 3/4/5/6) with the client before claiming any commission; otherwise, the agent is not entitled to claim commission.
• The commission dispute mechanism under s.49 is designed for disputes over commission amounts where a valid agreement exists, not for cases where no prescribed agreement was signed.

• Under section 32 of the Estate Agents Ordinance (Cap. 511), a licensee aggrieved by a Disciplinary Committee decision must appeal to the Secretary within 21 days of service of the decision notice
• The appeal tribunal shall consist of at least 3 members, and its decision is final under s.32(9)
• Under s.30, the Disciplinary Committee may impose: reprimand, add/vary licence conditions, suspend licence (up to 2 years), revoke licence, fine (up to $300,000), and order costs

• Under the Estate Agents Practice (General Duties and Hong Kong Residential Properties) Regulation (Cap. 511C), Form 1 (Property Information Form — Sale) is used for residential property sale transactions, while Form 2 (Property Information Form — Lease) is used for residential property leasing transactions.
• A licensed estate agency company must keep records relating to each residential property transaction for a minimum of 3 years.

• Under the Estate Agents Practice (General Duties and Hong Kong Residential Properties) Regulation (Cap. 511C), a licensed estate agent handling residential property transactions must provide clients with the Property Information Form — Form 1 for sale transactions and Form 2 for lease transactions.
• The Property Information Form must be provided before the client signs a binding agreement, not after the transaction is completed. Non-compliance constitutes a breach of the practice regulation and may lead to disciplinary action.
• Under section 30 of the Estate Agents Ordinance (Cap. 511), the disciplinary committee may impose sanctions including reprimand, suspension of licence (up to 2 years), revocation of licence, or a fine (up to HK$300,000).

• Under s.49 of the Estate Agents Ordinance (Cap. 511), the filing fee for commission dispute arbitration is HK$500, and the arbitration fee is 10% of the disputed amount (minimum HK$2,000)
• The EAA may refuse to accept arbitration applications where the disputed amount exceeds HK$300,000
• Either party dissatisfied with the arbitration award must appeal to the District Court within 14 days (not 21 days) from the date of the award

• An "as is" clause means that the property is sold and delivered in its actual physical condition as at the date the provisional agreement for sale and purchase was entered into.
• An "as is" clause covers only the physical condition of the property; it does not constitute any warranty by the vendor as to the legality of unauthorised building works under the Buildings Ordinance.
• An "as is" clause neither binds the purchaser to any existing tenancy affecting the property nor constitutes any representation or undertaking by the vendor regarding compliance with the Buildings Ordinance.

• Under the common law framework, a valid contract requires four essential elements: Offer, Acceptance, Consideration, and an intention by all parties to create legal relations.
• An agreement on the method of dispute resolution is not an essential element for the formation of a valid contract.

• Disclosing personal data to a third party for an additional purpose without the data subject's consent contravenes Data Protection Principle 3 (Use of Personal Data) under the Personal Data (Privacy) Ordinance, Cap. 486.
• Losing personal data contravenes Data Protection Principle 4 (Security of Personal Data), which requires the data user to take reasonably practicable steps to prevent unauthorised or accidental access to, processing, erasure, loss or use of personal data.
• Data Protection Principle 2 (Accuracy and Retention of Data) and Data Protection Principle 6 (Access to and Correction of Personal Data) are not relevant to the facts of this scenario.

• An agent who accepts a benefit from a third party without the principal's consent in exchange for not performing a certain act may contravene section 9(1) of the Prevention of Bribery Ordinance.
• An agent who fails to submit all received offers to the principal as soon as practicable contravenes section 11(e) of the Practice Regulation.
• The Unconscionable Contracts Ordinance, the Estate Agents (Determination of Commission Disputes) Regulation, and the Personal Data (Privacy) Ordinance are not relevant to this scenario.

• After the initial five-year restriction period, the owner of an HOS unit may sell the unit on the open market upon payment of the premium.
• The Agreement for Sale and Purchase must stipulate that the premium shall be paid within 28 days from the date of signing the agreement (or such other period as specified by the Director of Housing) and before the completion of assignment.
• This requirement is prescribed under the relevant provisions of the Housing Ordinance (Cap. 283).

• When a purchaser defaults, the vendor is entitled to forfeit the deposit, terminate the agreement, and resell the property to another buyer.
• A "charging memorandum" is generally used to record outstanding management fees, Government rent, or rates, and is not applicable to situations of purchaser default.

• The agent must review the original Agreement for Sale and Purchase to ascertain whether it contains any clause restricting assignment (Practice Circular 01-08 (CR), paragraph (1)(a)).
• The agent must advise the purchaser whether the balance of the purchase price is sufficient to cover the outstanding balance payable by the confirmor (paragraph (2)(b)).
• The purchaser may not necessarily be able to inspect the property before signing the sub-sale agreement, and the agent must alert the purchaser to this potential risk (paragraph (2)(a)).

• In all three circumstances, the agent should advise the purchaser to have the deposit held by a solicitors' firm as stakeholder: all-monies mortgage, charging order, and confirmor sub-sale.
• The common reason is that the actual amount required to be discharged upon completion is difficult to determine in advance, or the transaction itself carries a higher degree of inherent risk.

• A nomination executed between non-immediate family members is subject to ad valorem stamp duty on the value of the property under the Stamp Duty Ordinance.
• Joint tenancy carries the right of survivorship: upon the death of one joint tenant, that person's interest in the property automatically vests in the surviving joint tenant(s).
• Joint tenancy is not restricted to married couples; any persons may hold property as joint tenants.
• Executing a nomination does not require the concurrent execution of a deed of gift.

• Under section 13(1)(a) of the Conveyancing and Property Ordinance (Cap. 219), the vendor must deduce title for a period of not less than 15 years.
• The first document in the chain of title must be an assignment, a mortgage by way of conveyance, or a statutory charge.
• If the government lease was granted less than 15 years before the date of the agreement for sale and purchase, the period of title runs from the date of the grant of the government lease.

• Where customer due diligence cannot be completed, the licensee must neither establish a business relationship nor carry out any occasional transaction with that client (Practice Circular 18-01 (CR), paragraph 4.15).
• Where a business relationship has already been established, it must be terminated as soon as reasonably practicable.
• The licensee should consider whether a suspicious transaction report should be filed with the Joint Financial Intelligence Unit (JFIU), not make a direct report to the Hong Kong Police Force.

• Under the Residential Properties (First-hand Sales) Ordinance, the saleable area includes balconies and utility platforms.
• Bay windows and cocklofts are specifically excluded from the calculation of saleable area.
• The definition of saleable area is strictly prescribed by the Ordinance and cannot be interpreted expansively.

• HOS flats are subject to a premium restriction that limits their alienation until the premium is paid.
• An HOS flat owner wishing to sell on the open market must first pay the outstanding premium to the Hong Kong Housing Authority (HKHA).
• The Hong Kong Housing Society administers its own subsidised housing schemes separately from those of the HKHA.
• The Lands Department, Rating and Valuation Department, and Transport and Housing Bureau are not the bodies to which HOS premium is payable.

• Paying money to a bank employee to obtain favourable property valuations constitutes an offer of an advantage to an agent of a principal, potentially contravening the Prevention of Bribery Ordinance (Cap. 201).
• The Code of Ethics for estate agents prohibits conduct that is dishonest, improper or likely to bring the profession into disrepute, which would include secret payments to third parties.
• The Conveyancing and Property Ordinance (Cap. 219) governs conveyancing and property transactions and is not applicable to this type of bribery scenario.

• The Prevention of Bribery Ordinance (Cap. 201) defines 'advantage' very broadly.
• The definition of 'advantage' includes any gift, loan, fee, reward, commission, employment, contract, payment, release, discharge, service, favour and any other advantage of any description.
• Referral commissions, gifts (such as a valuable watch), and private loans all fall within the definition of 'advantage' under Cap. 201.
• There is no minimum monetary threshold for an item to qualify as an 'advantage' under the Ordinance.

Under the Personal Data (Privacy) Ordinance, when conducting direct marketing activities, a data user must inform the data subject that if the data subject requests cessation of the use of his or her personal data for direct marketing purposes, the data user must comply with that request free of charge.

Under the Stamp Duty Ordinance (Cap. 117), a deed of gift, a conveyance on sale, and an agreement for sale and purchase of a building are all chargeable instruments. A deed of mutual covenant is not a chargeable instrument for stamp duty purposes.

• A pre-completion inspection is conducted to verify that items not included in the sale have been removed and to confirm that the seller can deliver vacant possession on the completion date.
• Arranging renovation works is not a legitimate purpose of a pre-completion inspection and falls outside the scope of protecting the buyer's interests in this context.

• An 'as is' sale means the property is to be delivered in its actual physical condition as at the date of signing the provisional agreement for sale and purchase.
• The seller does not provide any additional warranty or undertaking regarding the condition of the property under an 'as is' sale.

• Where a property is likely to be in negative equity (i.e. the outstanding mortgage exceeds the sale price), the salesperson acting for the buyer has a duty to advise the buyer to place the deposit with a solicitor's firm as a stakeholder.
• The salesperson must also explain the risks of not adopting a stakeholder arrangement.
• If the buyer declines the advice, the salesperson must obtain written confirmation from the buyer as a record that the advice and explanation were duly provided.

• Under a tenancy in common, upon the death of a co-owner, his or her share in the property passes into his or her estate and does NOT automatically vest in the surviving co-owner(s).
• The right of survivorship (jus accrescendi) applies only to joint tenancy, not to tenancy in common.
• Tenants in common may hold unequal shares and there is no restriction to married couples.
• There is no legal requirement for tenants in common to appoint each other as executor.

• A mortgagor has an equitable right to redeem the mortgaged property upon full repayment of the secured debt, and may require the mortgagee to execute a discharge of mortgage.
• Upon default by the mortgagor, the mortgagee bank may exercise its power to appoint a receiver over the mortgaged property.
• A mortgage commonly contains a covenant restricting the mortgagor from leasing the property without the mortgagee's prior written consent, as an unauthorised tenancy may affect the bank's ability to realise its security.
• All three items are common and legally recognised terms or effects of a mortgage.

In circumstances involving higher risk — such as negative equity, a charging order on the property, or a confirmor sub-sale — the deposit should be held by a stakeholder to protect the purchaser's interests.

• (i) Sing Fung Properties placed the advertisements without first obtaining Lam Chi-wing's written consent, which is a contravention.
• (ii) Lam Chi-wing instructed an asking price of $2.8 million, but Sing Fung Properties advertised the property at $3.1 million, which is a contravention.
• (iii) The shop window advertisement stated a "saleable area of 550 sq. ft." (Lam Chi-wing indicated approximately 380 sq. ft.) and described the property as a "mortgagee sale" (which it was not); the lamp post advertisement claimed "contact the owner directly" but listed the agency's telephone number. These are all false or misleading statements, constituting contraventions. All three provisions of the Practice Regulation have been breached.

• All four items constitute breaches or improper practices: (i) Accepting a private reward from a client without disclosing it to one's supervisor breaches the company's internal rules and professional conduct requirements.
• (ii) Failing to disclose to the other party's client (Mrs. Lam) that an additional reward would be received constitutes concealment of a potential conflict of interest.
• (iii) Star Bright Properties' failure to arrange for a Form 3 to be signed with the vendor breaches the relevant provisions of the Practice Regulation.
• (iv) Making representations about property alterations without verification constitutes improper practice.

• Under the Practices Regulation, a licensed estate agent must deliver a duly completed Property Information Form (Form 1) to the client (i.e. the vendor, Mr. Hong) at one of two points in time, as chosen by the client: (a) before the estate agency agreement (Form 3) is entered into; or (b) before the vendor enters into a contract of sale and purchase with a prospective purchaser.
• The right to choose the timing of delivery belongs to the client (Mr. Hong), not to the agent (Carmen).

• Under the Practices Regulation, when completing Form 1, a licensed estate agent must disclose all subsisting encumbrances revealed in the land search, including any Buildings Order. Accordingly, (i) is a statutory duty; failure to comply would constitute a breach of the Practices Regulation.
• As regards (ii), the Practices Regulation only requires that the relevant encumbrances be recorded in Form 1; there is no express requirement to attach copies of the underlying documents. As regards (iii), requesting the vendor to produce receipts evidencing payment of repair costs is not a statutory requirement under the Practices Regulation.

• Mr. Chan and his elder brother held the property as tenants in common. The right of survivorship does not apply to a tenancy in common.
• Upon the elder brother's death, his share (i.e. an undivided half share) of the property falls to be dealt with in accordance with his will. Since the elder brother died testate, a grant of probate must be obtained, and the land search would confirm that a grant of probate has been issued to Mr. Chan.
• Mr. Chan, in his capacity as executor, is entitled to deal with the property on behalf of his elder brother's estate; however, he must produce the grant of probate to establish his legal authority to do so. Production of the death certificate and the original will alone is insufficient.

• Under the Practices Regulation, an estate agent must not advertise a property at a price different from that instructed by the client. Since Mr. Chan has instructed the property to be listed at HK$6.8 million, the agent must advertise at that price unless the client issues fresh instructions. Statement (i) is correct.
• An estate agent is required to follow the client's instructions when placing advertisements and must not unilaterally substitute the client's stated asking price with a current market valuation. Statement (ii) is inconsistent with the Practices Regulation.
• Under the Practices Regulation, once the property has been sold, the estate agent must remove any related advertisement as soon as practicable. Statement (iii) is correct.

• (i) Under the Practice Regulation, upon receiving any money (including a deposit) from a client, the agent must issue a written receipt to that client. This is correct.
• (ii) A deposit held on behalf of a client must be placed in a trust account and not in the company's general operating account. This is correct.
• (iii) Depositing the deposit into the company's general operating account does not comply with the relevant provisions of the Practice Regulation. This is incorrect.
• (iv) Without express authorisation from the client, the agent must not use the client's deposit to set off commission payable by the vendor. This is incorrect. Therefore, only (i) and (ii) comply with the Practice Regulation.

• The legal definition of "vacant possession" requires the vendor to fulfil the following conditions upon completion: (i) remove all tangible items not forming part of the transaction from the property; (ii) ensure that no person is in occupation of the property; (iii) hand over the keys of the property to the purchaser. All three are necessary conditions for delivering vacant possession.
• (iv) Transferring the electricity deposit account is an administrative follow-up matter after completion and falls outside the legal definition of "vacant possession". It is therefore not a necessary condition.

• Under the Personal Data (Privacy) Ordinance (Cap. 486), personal data collected must only be used for the purpose for which it was originally collected and must not be transferred to third parties beyond that purpose.
• (i) The age of the property is information about the property itself and is not Chi-ming's personal data. Providing this does not constitute a breach.
• (ii) Handing over a copy of Chi-ming's identity card to the debt collection agency constitutes disclosure of personal data beyond the original purpose of collection and may constitute a breach.
• (iii) Informing the debt collection agency of the amount of commission owed is information necessary for debt recovery and may be regarded as within the scope of reasonable use.
• (iv) The telephone number of Chi-ming's father is the personal data of a third party. Providing it to the debt collection agency without the consent of the data subject constitutes a breach.

• An agent must proactively inform the client of all material information that may affect the transaction (section 3.4.2.3).
• An agent has a duty to avoid conflicts of interest. If a conflict is unavoidable, full disclosure must be made to the client (section 3.4.2.4).
• An agent must keep strictly confidential all confidential information provided by the client (section 3.4.2.5).
• Under the principle of non-delegability of duties (section 3.4.2.6), even with the client's consent, the original agent may not delegate all of his responsibilities to another person. Statement (iv) is therefore incorrect.

• A misrepresentation is a false statement of fact concerning a material matter that induces the other party to enter into a contract in reliance upon it (s. 3.5.6.1).
• Where a misrepresentation exists, the aggrieved party may apply to the court for rescission of the contract (Misrepresentation Ordinance, s. 3(2)) (s. 3.7.7.2).
• If the misrepresentation is fraudulent (i.e. the maker knew the statement was false or was reckless as to its truth), the aggrieved party may additionally bring a tort action for damages.
• Even in cases of innocent misrepresentation, the aggrieved party may still apply for rescission under equitable principles (or the court may award damages in lieu of rescission at its discretion). Therefore, statement (iv) is incorrect.

• "Saleable area" is defined to include the internal floor area of the unit, measured to the inner surface of the external walls and to the centre line of partition walls (s. 3.7.8.1).
• The area of a balcony must be included in the saleable area (s. 8(1)).
• The area of a utility platform must also be included in the saleable area (s. 8(1)).
• A car parking space does not form part of the saleable area of a residential unit and must not be included in the calculation. The developer must list car parking space details separately in an individual property information sheet.

• Data Protection Principle 1: At the time of collecting personal data, the data user must inform the data subject of the purpose of collection, the classes of persons to whom the data may be transferred, and the data subject's right of access and correction (s. 3.7.4.2).
• Data Protection Principle 2: Personal data shall not be kept longer than is necessary for the fulfilment of the original purpose. Retaining clients' personal data indefinitely violates this principle, so (ii) is non-compliant.
• Data Protection Principle 3: Personal data shall be used only for the purpose stated at the time of collection or a directly related purpose (s. 3.7.4.2).
• Data Protection Principle 4: The data user must take all reasonably practicable steps to safeguard personal data against unauthorised access, processing or disclosure (s. 3.7.4.2).

• The core element of the section 9 offence is that an agent solicits or accepts any advantage without the knowledge and consent of the principal (s. 3.7.6.2).
• Situation (i): The agent secretly accepts cash from the purchaser — this squarely satisfies the elements of a section 9 offence, with the vendor being the uninformed principal.
• Situation (ii): Charging a service fee to the purchaser after full disclosure and with the principal's written consent does not contravene the Ordinance.
• Situation (iii): The agent accepts a benefit from a renovation company without the vendor's knowledge in return for a referral — this also satisfies the elements of a section 9 offence.
• Situation (iv): A small festive souvenir with no intention by either party to influence a transaction generally does not constitute bribery.

• Floating-rate mortgages in Hong Kong are typically linked to the Prime Rate (P rate) or the Hong Kong Interbank Offered Rate (HIBOR / H rate) and fluctuate with market conditions (s. 3.9.3).
• Fixed-rate mortgages are uncommon in Hong Kong. Even where available, the rate is typically fixed only for an initial period before reverting to a floating rate — it does not remain fixed for the entire mortgage term. Therefore, statement (ii) is overly absolute and incorrect.
• The Debt Servicing Ratio (DSR) is an important indicator used by banks to assess a mortgage applicant's repayment capacity (s. 3.9.4).
• The Mortgage Insurance Programme of the Hong Kong Mortgage Corporation Limited allows eligible purchasers to borrow in excess of the standard loan-to-value ceiling, thereby reducing the required down payment (s. 3.9.2).

• An HOS owner who has not paid the premium may not sell the flat on the open market without the Housing Authority's approval, subject to the void alienation provisions under section 17B of the Housing Ordinance (s. 3.7.3.3).
• Under the HOS Secondary Market Scheme, an HOS owner who has not yet paid the premium may sell the flat to an eligible buyer holding a valid White Form or Green Form Certificate of Eligibility (s. 3.7.3.2).
• Under section 17B, any alienation in contravention of the restrictions is void and has no legal effect (s. 3.7.3.3).
• An HOS owner who has not paid the premium is generally not permitted to let the flat on the open market. Therefore, statement (iv) is incorrect (s. 3.7.3.4).

• Under section 18 of the Personal Data (Privacy) Ordinance (Cap. 486), a data subject has the right to confirm whether a data user holds their personal data and to access such data; the data user may charge a reasonable fee and must respond within forty days.
• Under section 22 of Cap. 486, a data subject has the right to request correction of inaccurate personal data, and the data user must take all practicable steps to correct the data within forty days of receiving the request.
• Cap. 486 does not confer an absolute statutory right on data subjects to compel data users to destroy personal data; furthermore, section 20 of the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615) requires that relevant records be retained for at least five years after the end of the business relationship, and this retention obligation takes precedence over general data minimisation principles.
• Under section 35C of Cap. 486, a data user intending to use personal data for direct marketing must notify and obtain consent from the data subject beforehand; the data subject has the right to require the data user to cease using their personal data for direct marketing.

• Under section 29 of the Stamp Duty Ordinance (Cap. 117), an agreement for sale and purchase of residential property must be stamped within 30 days of execution; late stamping attracts a penalty. An unstamped instrument is inadmissible as evidence in court but is not rendered void.
• Under Head 2 of the First Schedule to the Stamp Duty Ordinance (Cap. 117), a Hong Kong permanent resident (not a company) purchasing a residential property in their own name as their sole or first residential property pays AVD at Scale 2 rates. For a property valued between HK$6,000,001 and HK$9,000,000, the applicable rate is 3.75%.
• Option B conflates the concept of 'stamping before completion is lawful': the statutory deadline for stamping a formal agreement is 30 days from execution, not the completion date. Stamping at any point within 30 days attracts no penalty — it is incorrect to say that stamping at any time before completion is penalty-free.

• Section 6 First Conduct Rule of the Competition Ordinance (Cap. 619): prohibits agreements between competitors that have the object or effect of harming competition, including fixing or coordinating prices (e.g. setting a minimum commission floor); this constitutes serious anti-competitive conduct regardless of whether the agreement is oral or written.
• Section 21 Second Conduct Rule of the Competition Ordinance (Cap. 619): prohibits undertakings with substantial market power from abusing that power; if the companies involved do not possess substantial market power, seeking a competitor's client information does not automatically trigger the Second Conduct Rule, but may simultaneously contravene the Personal Data (Privacy) Ordinance (Cap. 486).
• Horizontal coordination by estate agents on commission rates is a serious anti-competitive conduct under the First Conduct Rule; the Competition Commission may bring proceedings directly before the Competition Tribunal without first issuing a warning notice.

• Under the Anti-Money Laundering and Counter-Terrorist Financing Ordinance (Cap. 615), if an estate agent suspects that a transaction involves money laundering or terrorist financing, they must submit a Suspicious Transaction Report (STR) to the Joint Financial Intelligence Unit (JFIU) of the Hong Kong Police Force — not to Customs and Excise or the Estate Agents Authority.
• Cap. 615 requires that after submitting an STR, the regulated person must not disclose to the counterparty or any other person that a report has been made; breaching this 'tipping-off' prohibition constitutes a criminal offence.
• Estate agents are required to retain customer due diligence records and transaction records for a minimum of 5 years, calculated from the date of termination of the business relationship or completion of the transaction — a mandatory requirement under Cap. 615.
• Inability to satisfactorily explain the source of funds triggers enhanced due diligence (EDD) regardless of whether the client holds a local identity document; estate agents must assess the associated risk.

• Under contract law principles, the customary deposit is 10% of the purchase price; a deposit exceeding 10% may be held by the court to be a penalty and therefore unenforceable
• Under the Stamp Duty Ordinance (Cap. 117), stamping later than 1 month but within 2 months after execution incurs a penalty of 4 times the stamp duty payable
• Under section 3(1) of the Conveyancing and Property Ordinance (Cap. 219), a land contract must be in writing and signed by the defendant, but need not be executed as a deed; deeds are required for transfers of legal estates (s.4) and leases exceeding 3 years, etc.

• Under the Stamp Duty Ordinance (Cap. 117), nomination to a non-close relative (i.e. persons other than parent, spouse or child) attracts full AVD. A business partner is not a close relative and no exemption applies.
• Late stamping penalties: not more than 1 month late = 2x duty; more than 1 month but not more than 2 months = 4x duty; more than 2 months = 10x duty. The formal agreement was signed on 5 February 2024 and stamped on 20 May 2024 — over 2 months late — so the penalty is 10 times the duty.

• Under s.9(1) of the Prevention of Bribery Ordinance (Cap. 201), any agent who, without the permission of his principal, solicits or accepts an advantage as an inducement or reward for doing or forbearing to do any act in relation to his principal's affairs commits an offence. 'Advantage' covers money, gifts, loans, etc., but excludes entertainment.
• Under s.9(3) of the Prevention of Bribery Ordinance (Cap. 201), any agent who, with intent to deceive his principal, uses any receipt, account or other document which is false, erroneous or defective in any material particular commits an offence. Wei-yip's use of a fabricated valuation report to mislead Kwok-keung into reducing the price constitutes offences under both s.9(1) and s.9(3).

• Under the Personal Data (Privacy) Ordinance (Cap. 486), Data Protection Principle 3 provides that personal data shall not be used for a purpose other than or unrelated to the original purpose of collection, unless the data subject gives prescribed consent.
• Personal data collected by an estate agent during a property transaction is collected for the purpose of facilitating that transaction; transferring such data to market insurance products without the data subject's consent constitutes a breach of DPP3.
• DPP1 governs the purpose and manner of data collection, whereas DPP3 governs restrictions on use after collection — they apply at different stages.

• Under the Stamp Duty Ordinance (Cap. 117), nomination to a non-immediate family member (i.e. not a spouse, parent, or child) is subject to full ad valorem stamp duty (AVD); only nominations to a parent, spouse, or child are exempt
• A preliminary sale and purchase agreement must be stamped within 30 days of signing; late stamping within 1 month incurs a penalty of 2 times the duty; between 1–2 months = 4 times; over 2 months = 10 times
• A preliminary sale and purchase agreement is generally legally binding, unlike a 'subject to contract' arrangement; the deposit amount alone does not determine whether a contract is binding, though deposits exceeding 10% may be treated as a penalty and be unenforceable

• Under s.3 of the Land Registration Ordinance, registered instruments have priority by registration date; if registered within one month of execution, priority dates back to the execution date; if registered after one month, priority runs only from the registration date.
• An unregistered instrument is void against a bona fide purchaser, but this does not mean the deed automatically becomes invalid — non-registration only affects priority, not the validity of the deed itself.

• Under s.3 of the Land Registration Ordinance, registered instruments have priority by date of registration; if registered within one month of execution, priority dates back to the execution date; if registered more than one month after execution, priority runs from the registration date only.
• An unregistered instrument is void against a bona fide purchaser for value. Since Wei Tat is an innocent bona fide purchaser who registered first, his interest takes priority.

• Under s.3 of the Land Registration Ordinance, registered instruments have priority by registration date; if registered within one month, priority dates from the execution date; if registered after one month, priority dates from the registration date.
• An unregistered instrument is void against a bona fide purchaser for value, but the transaction itself is not void — Sze-man may pursue other legal remedies (e.g. fraud) against Chun-bong.

• Under s.3 of the Land Registration Ordinance, registered instruments have priority by registration date; if registered within one month of execution, priority runs from the date of execution; if registered after one month, priority runs from the date of registration.
• Unregistered instruments are void against a bona fide purchaser, but not void in all circumstances (exception: leases of 3 years or less at full rent without premium).

• Under s.3 of the Land Registration Ordinance, registered instruments have priority by registration date; if registered within one month, priority dates from execution. Unregistered instruments are void against a bona fide purchaser for value.
• Under the Stamp Duty Ordinance (Cap. 117), late stamping penalties are: not exceeding 1 month late = 2x duty; over 1 month but not exceeding 2 months = 4x duty; over 2 months = 10x duty. Six weeks falls within the over-1-month-but-not-exceeding-2-months bracket, so the penalty is 4 times the duty.

• Under s.3 of the Land Registration Ordinance, registered instruments have priority by registration date. If registered within one month of execution, priority runs from the execution date; if registered after one month, priority runs from the registration date.
• Chi Ming's agreement was executed on 1 March 2024 but not registered until 15 April (over one month), so his priority runs from 15 April. Lai Shan's agreement was executed on 10 March and registered on 20 March (within one month), so her priority runs from 10 March. Therefore Lai Shan has priority.

• Under s.3 of the Land Registration Ordinance, a registered instrument enjoys priority from its date of execution if registered within one month; if registered after one month, priority runs from the date of registration.
• Under the Stamp Duty Ordinance (Cap. 117), late stamping penalties escalate: up to 1 month late = 2x duty; over 1 month but within 2 months = 4x duty; over 2 months = 10x duty. In this case, the agreement was signed on 1 March 2025 and not stamped until 5 June 2025 — over 2 months late — so the penalty is 10 times the duty payable.

• A land search record from the Land Registry contains details of all encumbrances affecting the property, including mortgages, statutory charges, building orders and court orders.
• The Companies Registry maintains records of registered charges over a company's assets, including charges over land or interests in land.
• The articles of association, certificate of incorporation and business registration certificate do not contain any information relating to mortgages or charges over a specific property.

• Mortgage agreements / legal charges typically contain a covenant prohibiting the mortgagor from letting the property to a third party without the prior written consent of the bank / mortgagee.
• If the landlord lets the property without the mortgagee's consent and the mortgagee subsequently takes possession, the tenant will be unable to continue occupying the unit.
• An agent should advise a prospective tenant to require the landlord to obtain written consent from all mortgagees (including both banks and finance companies) before signing the tenancy agreement.
• Approval from the building's property management company and the Building Authority is not a prerequisite for entering into a tenancy agreement.

Under the Land Registration Ordinance (Cap. 128), a deed of assignment of a residential flat, a mortgage of a car parking space, and a charging order over a commercial/industrial property are all registrable instruments at the Land Registry.

A Dangerous Hillside Order subsisting on a property cannot be disregarded merely because it was issued before the transaction. The provisional agreement for sale and purchase should clearly stipulate which party is to bear the repair costs. The responsibility for repair costs is not necessarily borne solely by the owners' corporation.

• An unexpired tenancy agreement is an encumbrance that binds a purchaser and should be brought to the purchaser's attention.
• An outstanding building order indicates that the owner is required to carry out specified works; if not yet complied with, it remains an encumbrance affecting the property.
• A mortgage that has been formally discharged no longer constitutes a burden on the property and need not be flagged as a concern.

• When purchasing a property from a company, the estate agent should conduct a company search to verify the registered office address, the names of directors, and whether a receiver or liquidator has been appointed.
• Knowing whether a receiver or liquidator has been appointed is critical, as it may affect the company's capacity to sell the property.
• The identity of directors is important to confirm who has authority to execute documents on behalf of the company.
• The name of the company secretary is generally less critical to a purchaser's due diligence in a property transaction.

• A receipt on discharge of a charge is the document that confirms a mortgage has been fully repaid and discharged — it is the correct evidence of mortgage discharge in a land search.
• A letter of compliance is typically issued by the Building Authority to confirm that works required under a building order have been completed; it has no relation to the discharge of a mortgage.
• A second mortgage merely creates an additional charge over the property in favour of another lender; it does not indicate that the first mortgage has been discharged.

• The mortgage document bearing reference number UB6551093 contains a notation "EXERCISE POWER OF SALE", indicating that the mortgagee has exercised the power of sale over the property and that the mortgage obligation has consequently been extinguished (see Assignment No. 07101300960088).
• The charging orders bearing reference numbers UB6634446 and UB6665515 were registered against the previous owner Chiu Chi Keung; upon the formal transfer of title to Lam Kin Wah, these charging orders were discharged and no longer constitute encumbrances binding on the current owner.
• The encumbrances currently subsisting against the property are: (iv) the Legal Charge (No. 07101300960099) granted by Lam Kin Wah in favour of Futong Bank Limited; and (v) the Memorandum (No. 12122300150651) registered by Tsui Fung Court Property Management Limited in respect of outstanding management fees.

• According to the land search, the currently subsisting mortgage is the Legal Charge bearing reference number "07101300960099", the benefit of which is held by Hang Shing Bank Limited. This charge was registered when the current owner Lam Bik Shan purchased the property in 2007, and Hang Shing Bank Limited is therefore the current mortgagee.
• The mortgages in favour of Fu Yu Finance Limited and Sun Nga Bank Limited have both been discharged. The charging order in favour of Hoi Fung Finance Corporation Limited was registered against the previous owner Wong Chi Keung. Tak On Property Management Limited is the management company of the property and is not a mortgagee.

• Under the Estate Agents (Practices and Conduct) Regulation, when completing the "Property Information Form" (Form 1), the saleable area of a residential property must be obtained from the Interrnet Rateable Values and Saleable Area Information System (IRIS) provided by the Rating and Valuation Department, which is the prescribed source for this purpose.
• Documents such as the Occupation Permit, the Deed of Mutual Covenants with Plans, and various assignments do not qualify as prescribed sources for saleable area information for the purposes of Form 1.

• The remarks for Memorandum "12122300150651" show "BY WAI HING PROPERTIES MANAGEMENT LIMITED", indicating that Wai Hing Properties Management Limited registered the memorandum at the Land Registry in respect of outstanding management fees. Therefore, statements (i) and (ii) are both correct.
• Statement (iii) is incorrect — the memorandum does not constitute a restriction on assignment. Statement (iv) is also incorrect — the memorandum does not automatically lapse upon completion of the sale; it can only be discharged after the outstanding fees have been fully settled.

• The land search records show that the lease for the lot has a total term of 999 years commencing on 7 January 1862. Taking the search date of 7 January 2013, the remaining term is calculated as: (1862 + 999) − 2013 = 848 years.
• Option D (999 years) represents the total lease term, not the remaining term as at the date of search.

• (i) The Deed of Mutual Covenant (DMC) contains the covenants, management rules, and the rights and obligations that all owners of the building must observe. This is a correct document.
• (ii) An Assignment merely records the transfer of title of a particular interest and does not cover the general rights and obligations of all owners.
• (iii) The Conditions of Exchange is a government land grant document that sets out the obligations of the owners towards the Government. This is a correct document.
• (iv) An Agreement for Sale and Purchase is a document for an individual transaction and does not set out the general obligations of owners.

• (i) The land search record states "SHARE OF THE LOT: 75/306", indicating that the property comprises 75 out of 306 equal and undivided shares. This statement is correct.
• (ii) The Consent to Assign (or Occupation Permit) UB6554556 is dated 31 January 1996, from which it may be inferred that the building was completed in 1996. This statement is correct.
• (iii) The land search record shows that the lease term is "FROM 2 JUNE 1992 TO 23 FEBRUARY 2032", which is approximately 40 years, not 75 years renewable for 75 years. This statement is incorrect.

• (i) Conditions of Exchange documents do not contain saleable area information for individual units, and is therefore incorrect.
• (ii) An Occupation Permit reflects the year of completion of the building, and is therefore correct.
• (iii) An Occupation Permit states the approved use of the building, and is therefore correct.
• (iv) An Agreement for Sale and Purchase with a plan may contain information relating to the unit's floor area, and is therefore correct. Note that the statutory source for the saleable area of a residential property is the Rating and Valuation Department's Integrated Rating and Valuation Information System (IRIS); Conditions of Exchange is not an applicable source.

• (i) The Assignment is the standard conveyancing document by which the current owner acquired title to the property. A prospective purchaser does not need to seek specific legal advice on this document.
• (ii) The Building Order (Order No. DH0133/HK/10C) is a statutory order with significant implications, directly affecting the lawful use of the property and mortgage approval by banks. The estate agent should urge the purchaser to seek legal advice.
• (iii) The Memorandum of Charge (in favour of Hong Shing Management Limited) reflects outstanding management fees owed in respect of the property, constituting an encumbrance affecting the title. The estate agent should advise the purchaser to seek legal advice.

• (i) The Memorandum of Charge records the amount of outstanding management fees owed, not the monthly management fee standard payable by each owner. This statement is therefore incorrect.
• (ii) The Memorandum of Charge is an encumbrance registered on the land register that affects the title to the property. This statement is therefore correct.
• (iii) Since the document constitutes an encumbrance affecting the title, the Provisional Agreement for Sale and Purchase should stipulate that the encumbrance must be discharged (i.e. all outstanding fees settled in full) on or before the date of completion. This statement is therefore correct.

• (i) The expiry date of the Conditions of Exchange is 23 February 2032. Calculated from the land search date of 20 January 2013, the unexpired term is approximately 19 years, which does not exceed 30 years. This statement is therefore incorrect.
• (ii) The Assignment No. 05042702460788 records a transfer of title from Chan Wai Ling to Fung Chi-keung and Fung Chi-wai. Chan Wai Ling is the vendor. This statement is therefore correct.
• (iii) The instrument date of the receipt for discharge of Statutory Charge UB6660752, document "UB7414490", is 23 January 1998, not 10 June 1996. This statement is therefore incorrect.

• An undischarged mortgage document constitutes an encumbrance on title, indicating the property has been used as security. The purchaser must ensure the vendor discharges the mortgage before completion; otherwise the title will be defective (s. 4.1.3).
• The Deed of Mutual Covenant (DMC) is a standard title document for the building and is not normally regarded as a title defect — it is an expected registration record (s. 4.1.3).
• An uncompleted formal agreement for sale and purchase means the property may already have been sold to another party. The current purchaser must follow up immediately to avoid a title dispute (s. 4.3.1).
• An Occupation Permit (OP) is a standard document certifying that the property is fit for lawful occupation and generally does not constitute a title problem (s. 4.1.3).

• Under section 8 of the Government Rent (Assessment and Collection) Ordinance (Cap. 515), government rent for leases granted or renewed on or after 1 July 1997 is charged at 3% of the annual rateable value of the property.
• The government rent amount automatically adjusts whenever the Rating and Valuation Department reassesses the rateable value of the property; it is not fixed at a base date value nor calculated on market value.
• Rates are separately levied under the Rating Ordinance (Cap. 116); although rates also use rateable value as the base, the percentage is set by the annual Budget and operates under a different regime from government rent.

• Under the Rating Ordinance (Cap. 116), rates are calculated as a percentage of the rateable value; in this question, annual rates = HK$96,000 × 5% = HK$4,800.
• Under the Government Rent (Assessment and Collection) Ordinance (Cap. 515), lessees holding government leases granted or renewed on or after 1 July 1997 must pay government rent at 3% of the rateable value; in this question, annual government rent = HK$96,000 × 3% = HK$2,880.
• Both rates and government rent are based on the rateable value assessed by the Rating and Valuation Department, but their legal bases differ: rates are governed by Cap. 116 and government rent by Cap. 515.

• User restrictions in a government lease are binding on all lawful occupiers of the land, regardless of whether they are the original grantee; breach of user restrictions may lead to re-entry action by the Lands Department under the Government Lands Ordinance (Cap. 28).
• A 'residential purposes' restriction in a government lease generally excludes any fee-charging commercial activity; operating a tutorial centre and collecting tuition fees is commercial in nature and constitutes a breach risk; under the Conveyancing and Property Ordinance (Cap. 219), covenants in a land contract are binding on successors and assigns.
• Under the Rating Ordinance (Cap. 116), the actual use of a property may affect its rateable value assessment; if a property changes from residential to commercial use, the rateable value may be adjusted accordingly.

• Under the Rating Ordinance (Cap. 116), rates are calculated by multiplying the rateable value by the percentage charge; in this question, rates = HK$144,000 × 5% = HK$7,200.
• Under the Government Rent (Assessment and Collection) Ordinance (Cap. 515), government rent applies only to new leases granted on or after 27 May 1985 under the post-Joint Declaration system, and to leases granted after 1 July 1997. A lease granted in 1988 that falls outside the post-Joint Declaration new lease regime is generally not subject to the government rent collection mechanism under Cap. 515, and therefore no government rent under Cap. 515 is payable for this property.
• Estate agents have a responsibility to accurately explain to clients the distinction between rates and government rent and their respective scopes of application, to avoid misunderstanding in property transactions.

• Under the Conveyancing and Property Ordinance (Cap. 219) and the Land Registration Ordinance (Cap. 128), once a DMC is registered at the Land Registry, it is legally binding on all present and future owners of the development, including clauses restricting the use of properties.
• Common parts as defined by the DMC (e.g. external walls, rooftop) are jointly owned by all owners according to their undivided shares, and owners may not unilaterally occupy or alter common parts.
• Restrictive covenants in a DMC do not automatically lapse with the passage of time, nor can they be waived merely by verbal consent of the management office; amendment typically requires the consent of all owners or a court order.

• TPS resale restrictions: first 2 years sell back to HA only; years 3–5 may offer to sell through HA at market value minus original discount; after 5 years open market sale with premium payment
• Under s.5 of the Land Registration Ordinance (Cap. 128), an instrument registered within one month of execution has its priority backdated to the execution date
• The land register comprises four parts: property particulars, owner information, encumbrances, and pending registrations
• A s.33 certificate under the Buildings Ordinance constitutes a first charge ranking ahead of all others; a s.24 order by itself is not a first charge

• Under s.5 of the Land Registration Ordinance (Cap. 128), an instrument registered within one month of execution has its priority backdated to the date of execution.
• NT leases running from 1 July 1898 for 99 years less 3 days have been automatically renewed until 30 June 2047, with rent payable at 3% of rateable value.
• Under s.4 of the Land Registration Ordinance (Cap. 128), unregistered interests do NOT constitute notice to subsequent purchasers.

• TPS resale restrictions have three stages: in the first 2 years, the unit can only be sold back to the Housing Authority at the original price; from year 3 to year 5, it may be offered to the HA at market value minus discount; after 5 years, it can be sold on the open market upon payment of the premium
• The premium must be paid within 28 days; selling without paying the premium is a criminal offence punishable by a maximum fine of HK$500,000 and 1 year's imprisonment, and the sale is void

• Under s.5 of the Land Registration Ordinance (Cap. 128), instruments registered within one month of execution have priority backdated to the execution date; if late, priority runs from the registration date, but the instrument does not become void
• Under s.5A of the Land Registration Ordinance (Cap. 128), charging orders and lis pendens have priority from the day after registration
• New Territories leases from 1 July 1898 (99 years minus 3 days) were automatically renewed until 30 June 2047, with rent at 3% of rateable value

• Under section 3 of the Land Registration Ordinance (Cap. 128), registered instruments have priority over unregistered instruments. Buyer B's registered deed takes priority over Buyer A's unregistered deed.
• Under section 5 of the Land Registration Ordinance, if an instrument is registered within one month of execution, its priority backdates to the execution date, but this only applies when the instrument is actually registered and does not override the existing priority of an already registered instrument.
• New Territories leases commencing from 1 July 1898 (99 years minus 3 days) have been automatically renewed until 30 June 2047, with rent at 3% of rateable value.

• Under section 3 of the Land Registration Ordinance (Cap. 128), registered instruments have priority over unregistered instruments
• Under section 5, an instrument must be delivered for registration within one month of execution for its priority to backdate to the date of execution; if delivered late, priority runs only from the date of registration
• Mr Chan's deed was executed on 10 March 2025 but not delivered for registration until 15 May 2025 (over one month), so its priority cannot backdate; Mr Lee's instrument registered on 1 April 2025 takes priority

• Selling a TPS unit on the open market without paying the required premium is an offence punishable by a fine of $500,000 and imprisonment for 1 year, and the sale is void.
• Under section 5 of the Land Registration Ordinance (Cap. 128), an instrument registered within one month of execution has its priority backdated to the date of execution.
• A building order issued under section 24 of the Buildings Ordinance may be registered in the encumbrances section of the land register and constitutes an encumbrance on the property.
• TPS units: first 2 years sell back to HA only; years 3-5 offer to HA at market value minus discount; after 5 years may sell on open market but premium must be paid.

• Under s.3 of the Land Registration Ordinance (Cap. 128), registered instruments have priority; s.5 provides that an instrument must be delivered for registration within one month of execution for its priority to backdate to the execution date
• The deed executed on 10 February was not delivered for registration until 20 March, exceeding the one-month limit, so its priority runs only from the date of registration; the deed executed on 25 February was registered on 5 March (within one month) and its priority backdates to 25 February, giving it superior priority
• Upon expiry of a non-renewable lease, the owner may apply for a new 50-year land grant, subject to payment of rent at 3% of rateable value

• Under section 3 of the Land Registration Ordinance (Cap. 128), registered instruments have priority over unregistered instruments.
• Under section 5, if an instrument is delivered for registration within one month of execution, its priority backdates to the execution date; if registered after one month, priority runs only from the date of registration.
• New Territories land with original leases commencing 1 July 1898 (99 years less 3 days) has been automatically renewed until 30 June 2047, with rent at 3% of rateable value.

• An Occupation Permit is issued by the Building Authority pursuant to the Buildings Ordinance (Cap. 123).
• The Occupation Permit typically records the approved use of each unit, the year of completion of the building, and the total number of units on each floor.
• The Occupation Permit does not contain any floor area information (whether gross floor area or saleable area), nor does it relate to the term of any government land lease.

• The permitted use of land may be ascertained from the Outline Zoning Plan prepared by the Town Planning Board and from the government lease or conditions of grant.
• The Land Registry search records of the flat intended to be purchased do not contain information relating to the permitted use of adjoining lots.

• A Deed of Mutual Covenant is entered into between the developer and the first purchaser, and is equally binding on all subsequent assignees.
• The content of a DMC typically covers: the name of the first purchaser, the allocation of undivided shares to each part of the building, the definition of common parts, and the proportionate share of management fees.
• Management fees are generally apportioned among unit owners in proportion to their respective undivided shares.

• Building works of a structural nature require an Authorised Person to be appointed to prepare plans and submit them to the Building Authority for approval.
• Minor works not involving structural alterations may be exempted from prior approval by the Building Authority under section 41(3) of the Buildings Ordinance.
• There is no requirement to notify the Lands Department or to apply to the Housing Affairs Bureau for this type of works.

• A material change in the use of a building without approval requires notification to the Building Authority (Buildings Ordinance (Cap. 123), s.25(1)).
• The Building Authority has power to: issue an order requiring cessation of an unauthorised use, and prohibit a proposed use (s.25(2)).
• If the use of a property is materially changed in breach of approved conditions, the owner's title may become defeasible, and the Government may resume such title.

• The Building Authority may issue a notice to the owner requiring cessation of any use that contravenes the approved use specified in the occupation permit.
• Using a unit for a purpose other than its approved use may contravene the deed of mutual covenant of the building.
• Changing the approved use of a unit is not a simple matter of paying a land premium; it involves a formal application and approval process and is not achievable at any time merely upon payment.

• A Deed of Mutual Covenant (DMC) is not an instrument for the mutual transfer of unit titles among owners.
• The DMC is entered into between the developer and the first purchaser of each unit to regulate the management of the building.
• The DMC typically contains provisions on permitted uses, management responsibilities, and is registrable at the Land Registry.

• The approved use of a building is stated in the Occupation Permit (OP) issued by the Building Authority.
• A mortgage deed contains terms relating to the financing of the property and does not specify the building's approved use.
• A requisition on title is a notice used in conveyancing to raise queries on title and does not record the approved use of a building.

• An application to change the permitted use of a building must be made to the Building Authority (i.e. the Director of Buildings), NOT the Rating and Valuation Department.
• Using a non-residential approved premises for residential purposes without authorisation may constitute a breach of the Buildings Ordinance (Cap. 123).
• An unauthorised change of use may render the title to the property defective.
• A salesperson owes a duty of care to his or her client, which includes verifying the permitted use of a property before proceeding with a transaction.

• Under the Buildings Ordinance (Cap. 123), a certificate of compliance issued by the Building Authority is the authoritative document confirming that an order (including an order to demolish an unauthorised structure) has been duly carried out.
• The Building Authority is the Director of Buildings, exercising statutory functions under the Buildings Ordinance.
• Neither the Land Registry, the Lands Department, a property management company, nor the Buildings Department (as a separate entity from the Building Authority) issues such a certificate of compliance.

• Under the Building Management Ordinance (Cap. 344), an owners' corporation is responsible for: (1) keeping the common parts of the building in a state of good repair; (2) carrying out works required by relevant government departments in respect of the common parts; and (3) performing the management responsibilities stipulated in the deed of mutual covenant.
• All three items are statutory duties of an owners' corporation.

• The deed of mutual covenant (DMC) is the primary document that defines and delineates which areas of a building constitute its common parts.
• A government lease sets out the terms and conditions of the land grant but does not define the common parts of a building.
• An occupation permit (certificate of compliance issued under the Buildings Ordinance, Cap. 123) certifies that a building is fit for occupation but does not define the common parts.
• Only the deed of mutual covenant contains the definition of common parts.

• Under the Buildings Ordinance, building plans must generally be submitted to and approved by the Buildings Department before commencing alteration or addition works (s. 5.4.2).
• The statement that no government authority need be notified is overly absolute. Works involving drainage, electrical installations or structural elements, even if non-load-bearing in nature, may still be subject to regulatory requirements. Therefore, statement (ii) is incorrect.
• Changing the use of a building (e.g. from residential to commercial) is a regulated activity that generally requires application to the Buildings Department and may also require town planning permission (s. 5.4.3).
• The Buildings Department has the power to issue orders against owners of unsafe buildings or unauthorised building works, requiring them to carry out remedial works or demolition (ss. 5.3.2 and 5.3.3).

• Under section 14 of the Buildings Ordinance (Cap. 123), any person intending to carry out building works involving a change of the approved use of a building must first submit building plans signed by an Authorized Person (AP) to the Buildings Department and obtain the approval and consent of the Building Authority.
• Converting an industrial unit to office use constitutes a change of approved use, as structural load capacities and fire safety standards may differ; this requires formal approval and does not fall within the scope of minor works or a simple notification to the Lands Department.

• Under section 21 of the Buildings Ordinance (Cap. 123), no person shall occupy a building before the Building Authority issues an occupation permit, except for a maximum of 2 caretakers.
• The Building Authority under the Buildings Ordinance is the Director of Buildings.

• Under the Building Management Ordinance (Cap. 344), the management committee must apply to the Land Registrar within 28 days for registration of the owners' corporation.
• Owners holding not less than 5% of the shares may convene an owners' meeting to discuss the formation of an owners' corporation.

• Under section 21 of the Buildings Ordinance (Cap. 123), no person shall occupy a building before an occupation permit is issued by the Building Authority, except for a maximum of 2 caretakers.
• The Building Authority is the Director of Buildings, who is responsible for enforcing the provisions of the Buildings Ordinance.

• Under section 25(1) of the Buildings Ordinance (Cap. 123), the occupier must give 1 month's notice to the Building Authority before any change of use of a building.
• The Building Authority is the Director of Buildings, who is responsible for enforcing the provisions of the Buildings Ordinance.

A standard valuation report generally must state the date of valuation and the assessed value of the property. The prevailing mortgage interest rate and the fee charged for the report are not typically included as essential contents of a valuation report.

The comparison method is most reliable when there is ample and stable transaction volume in the market and when comparable properties share highly similar characteristics. Conversely, dramatic price fluctuations undermine the accuracy and reliability of comparison-based valuations.

• The comparison method is suitable for properties with sufficient comparable market transactions available. Residential flats are the most typical application (s. 6.4.1).
• The profits method is primarily used to value properties whose worth is based on their profit-generating potential, such as hotels, cinemas and petrol stations (s. 6.4.3).
• The residual method is the principal means of valuing development land. The land value is derived by deducting total development costs from the estimated market value of the completed development (s. 6.5.2).
• The contractor's method (depreciated replacement cost) is used for special-purpose properties lacking sufficient comparable transactions. It estimates value by calculating the cost of rebuilding or replacing the property (s. 6.4.4).

• According to the Hong Kong Institute of Surveyors Valuation Standards, when applying the Comparison Method, systematic adjustments must be made for all differential factors in each comparable transaction (including size, floor level, location, time of transaction, and view) before a reliable valuation basis can be established.
• The core principle of the Comparison Method requires the valuer to identify and quantify each adjustment factor, including: (i) time adjustments (reflecting market movement); (ii) location adjustments (differences between adjacent or different estates); and (iii) individual property characteristic adjustments (floor level, view, size, etc.) to ensure comparability after adjustment.
• The Rating and Valuation Department's assessment methodology also indicates that comparable transactions should ideally be as close as possible to the valuation date, but transactions from more distant dates are not entirely unusable — they require appropriate time adjustments before application.

• The Cost Approach is applicable to special-purpose properties with few or no comparable market transactions, such as industrial plants, schools, and temples; it is one of the five valuation methods recognised by the Hong Kong Institute of Surveyors Valuation Standards.
• The standard procedure of the Cost Approach involves: (1) estimating the current market value of the land (assumed vacant and available); (2) calculating the replacement cost of the building (Modern Equivalent Asset — the cost to construct a building of equivalent utility using current construction costs); (3) deducting three categories of depreciation: physical deterioration, functional obsolescence, and economic obsolescence; (4) adding the depreciated building value to the land value to arrive at total property value.
• Replacement Cost differs from Reproduction Cost: Replacement Cost refers to the cost of constructing a modern equivalent building with the same utility, whereas Reproduction Cost refers to the cost of creating an exact replica of the existing building; in Cost Approach valuations, Replacement Cost is generally adopted.

• Core principle of the Income Approach: Market valuation should be based on Market Rental Value (MRV) rather than contract rent, in order to reflect the open market value of the property at the valuation date, consistent with the requirements of HKIS Valuation Standards VS 3.
• Calculation of net rental income: All outgoings payable by the landlord (such as rates, government rent, and management fees) must be deducted from gross rental income before the net income figure is capitalised.
• Capitalisation formula: Market Value = Net Annual Income ÷ Capitalisation Rate. The capitalisation rate reflects market expectations of risk and return for that property type; the division must not be confused with multiplication.

• The HKIS Valuation Standards require valuers applying the Comparison Method to make reasonable adjustments to comparables for all material differences affecting property value, including floor level, views, area, and facilities, in order to reflect the market value of the subject property.
• The Rating and Valuation Department also adopts floor level as an adjustment factor when assessing rateable value, recognising that higher floors (especially those with open views) generally command a market premium — a principle widely applied in private property market valuations.
• The core principle of the Comparison Method is the 'Principle of Substitution'. Valuers must identify and quantify differences between each comparable and the subject property before arriving at a reliable valuation conclusion, rather than mechanically applying transaction prices or unit rates from comparables.

• The core formula of the residual method is: Land Value = GDV minus all development costs, including construction costs, interest, professional fees, marketing costs, and developer's profit.
• The residual method is primarily used for land valuation of development sites. The Discounted Cash Flow (DCF) method is an extension of the residual method that incorporates the time value of money.

• For a lease exceeding 3 years, the applicable stamp duty rate is 1% of the annual rent or average annual rent.
• The renewal option (including its rent and term) is not taken into account when calculating stamp duty on the original lease.
• The rent-free period reduces the actual rent collected: only 10 months' rent is collected in the first year of the lease.
• Average annual rent calculation: ($100,000 × 10 + $100,000 × 12 × 4) ÷ 5 = $1,160,000.
• Total stamp duty payable: $1,160,000 × 1% + $5 (counterpart fee) = $11,605.

• A tenancy agreement must be stamped in accordance with the Stamp Duty Ordinance (Cap. 117).
• A tenancy agreement containing a renewal option or purchase option should be registered at the Land Registry so that the option is binding on third parties (e.g. a subsequent purchaser of the property).
• A lease not exceeding 3 years at a market rent is an overriding interest and protects the tenant even without registration; however, a renewal option must be registered to be enforceable against third parties.
• There is no requirement for an estate agent to sign the tenancy agreement on behalf of the tenant, nor is there any requirement to lodge the agreement with the Building Authority.

• A tenancy agreement must be stamped within 30 days of execution.
• If stamping is not carried out within the statutory time limit, the maximum additional penalty is ten times the amount of stamp duty payable.

• Under Part IV of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7), statutory implied covenants in a residential tenancy include: (a) the tenant shall not make structural alterations without the landlord's consent; and (b) the tenant shall pay rent within 15 days of the due date.
• A prohibition on keeping animals is NOT a statutory implied covenant under Part IV of Cap. 7; it must be expressly included in the tenancy agreement to be enforceable.
• Breach of a statutory implied covenant may entitle the landlord to forfeit the tenancy.

• When handling a subletting transaction, the agent must verify whether the head tenancy contains a prohibition or restriction on subletting.
• If subletting is prohibited under the head tenancy, the agent must obtain written consent from the head landlord before proceeding.
• The term of the sub-tenancy must not exceed the remaining term of the head tenancy, as a sub-tenant cannot acquire greater rights than the sub-landlord possesses.
• There is no statutory requirement to notify the Buildings Department merely because a property is sublet; notification to the Buildings Department is NOT a necessary step in handling a subletting transaction.

• Before a tenancy agreement is signed, the parties should clearly agree on who bears responsibility for government rates, building management fees, and repair costs for electrical appliances included in the tenancy.
• Government rates are normally payable by the landlord under the Rating Ordinance (Cap. 116), but the parties may contractually agree otherwise.
• Building management fees and repair costs for electrical appliances are matters that can be allocated between landlord and tenant by agreement, and the responsible party should be expressly stated in the tenancy agreement.
• A licensed estate agent acting for both parties has a duty to ensure all material financial obligations are clearly agreed upon before execution of the tenancy agreement.

Implied covenants in a tenancy include not using the premises for illegal purposes, not causing unreasonable nuisance to others, and not carrying out structural alterations without the landlord's consent. Since the tenancy agreement does not contain a clause prohibiting sub-letting, the tenant's sub-letting of the unit does not constitute grounds for forfeiture of the leasehold interest.

• In a residential tenancy agreement, the responsibility for maintaining and repairing the external walls and structural parts of a property generally rests with the landlord, not the tenant.
• Common tenant obligations in residential tenancies include: permitting landlord access upon notice, not subletting or assigning without consent, maintaining the interior in good repair, and paying utility charges.
• Option D describes a landlord's obligation and would not ordinarily be imposed on a tenant under a residential tenancy agreement.

• Form CR109 is required to be submitted to the Rating and Valuation Department only in respect of residential properties.
• The two triggering events for Form CR109 are: (1) the grant of a new residential tenancy agreement, and (2) the renewal of an existing residential tenancy.
• Termination of a residential tenancy and tenancies of commercial properties do not require the submission of Form CR109.

• Expiry of the lease term followed by the tenant vacating as agreed is one of the lawful methods of terminating a tenancy (section 7.7.1).
• Mutual agreement between the landlord and the tenant to terminate the tenancy early is a lawful method. The parties may agree on compensation arrangements (section 7.7.2).
• Where the tenancy agreement contains a break clause, either party may exercise the right to terminate the tenancy early in accordance with the terms of that clause (section 7.7.3).
• If the landlord changes the locks or forcibly evicts the tenant without a court order, this constitutes an unlawful act and may amount to a criminal offence.

• The landlord has a responsibility to maintain and repair the structural parts and external walls of the property (s. 7.6.1).
• The implied covenant of quiet enjoyment under common law entitles the tenant to use the property without interference by the landlord during the term of the tenancy (s. 7.3.2).
• Interior repainting and redecoration are generally the tenant's responsibility and do not form part of the landlord's statutory obligations. Therefore, statement (ii) is incorrect.
• In Hong Kong, a landlord does not require the tenant's consent to sell the property. The existing tenancy binds the purchaser under the principle that a tenancy runs with the reversion. Therefore, statement (iv) is incorrect.

• Under Part IV of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) (in particular s.119ZB), residential tenancies carry a statutory implied covenant obliging the landlord to repair and maintain the structure and exterior of the premises, irrespective of whether the tenancy agreement contains any express provision to that effect.
• The 'fair wear and tear' exception does not exempt a landlord from repairing structural water seepage defects, since such seepage originates from structural deficiencies in the external wall rather than from deterioration caused by the tenant's ordinary use.
• Implied covenants are legally binding; a landlord cannot refuse to comply on the ground that the tenancy agreement is silent on the matter. The tenant may seek legal remedies to compel the landlord to perform the repair obligation.

• Under section 119C of Part IV of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7), a landlord has an implied covenant in a residential tenancy to keep the structure, exterior, common facilities, and sanitary installations in repair; this obligation cannot be excluded by the tenancy agreement.
• Any term in a tenancy agreement that purports to exclude or restrict the statutory protections conferred on the tenant by Part IV of Cap. 7 is not binding on the tenant (Cap. 7, s.119I).

• The rent control and rent assessment committee system (including standard rent and the Rent Assessment Committee) under the predecessor provisions of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) was fully abolished in the 1990s. The current Cap. 7 no longer provides any rent control mechanism for private residential premises.
• The current Part IV of Cap. 7 primarily deals with implied covenants in tenancies and forfeiture of tenancy; it does not confer on tenants any statutory right to apply to an independent body for determination of market rent. Rent levels are freely negotiated between landlord and tenant.
• Although the Lands Tribunal (Cap. 17) handles tenancy disputes, its functions do not include proactively determining a 'fair market rent' for private residential premises outside a rent control framework.

• Common law principle: Where a fixed-term tenancy expires and the landlord continues to accept rent while the tenant continues in occupation, the conduct of both parties may give rise to a new periodic tenancy, the period of which usually corresponds to the rent payment interval (e.g. a monthly tenancy where rent is paid monthly).
• Landlord and Tenant (Consolidation) Ordinance (Cap. 7), Part IV: The current operative provisions mainly apply to qualifying new tenancies; provisions previously granting residential tenants an automatic right to a one-year fixed-term renewal upon expiry have been amended or repealed, and candidates must distinguish between currently operative provisions and those that have been repealed or modified.
• Termination of a monthly tenancy: Under common law, a monthly tenancy requires notice equivalent to one full rental period (i.e. one month) to terminate, and the notice period must generally align with the rent payment date.

• Under common law, termination of a monthly tenancy requires notice equivalent to one complete rental period (i.e. one month), and such notice must take effect at the commencement of a rental payment cycle; otherwise the notice is legally invalid.
• Sections 125 and related provisions of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) require that a landlord wishing to forcibly recover possession of premises occupied by a tenant must obtain a recovery order through the Lands Tribunal. A landlord may not resort to self-help eviction measures such as changing locks (so-called 'unlawful eviction'), which may give rise to civil and criminal liability.
• The current Landlord and Tenant (Consolidation) Ordinance (Cap. 7) has repealed the former rent control provisions; there is no statutory requirement for a landlord to pay six months' rent as compensation when recovering a property for own occupation (this is a common misconception relating to the abolished regime).

• Under Hong Kong common law and section 6 of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7), a covenant of quiet enjoyment is implied in every tenancy: the landlord covenants that the tenant shall enjoy the demised premises without interference by the landlord or those claiming through them, and this protection applies automatically even where the tenancy agreement is silent.
• A fixed-term tenancy expires naturally on the stipulated date; the landlord is not required under section 125 of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) to serve a notice to quit in any particular form or within any prescribed period, unless the tenancy has converted to a periodic tenancy.
• A clause placing the burden of day-to-day repairs on the tenant is a valid contractual arrangement under Hong Kong law; however, the landlord's statutory duty to maintain structure and exterior walls under section 6A of Cap. 7 cannot be contracted out of by either party.

• Under the Stamp Duty Ordinance (Cap. 117), stamp duty on a tenancy agreement must be paid within 30 days of execution; an unstamped agreement cannot be registered at the Land Registry or used as evidence in court
• The landlord must submit Form CR109 to the Rating and Valuation Department within 1 month of the tenancy agreement; a late penalty of HK$310 applies; a landlord who fails to submit Form CR109 cannot sue the tenant for rent under that tenancy

• A licence confers only a personal right to use the property on the licensee; the landlord may revoke it at any time and the licensee does not enjoy a legal estate in land
• A tenancy grants the tenant exclusive possession, whereas a licence is characterised by the owner retaining the right to enter and revoke at any time, with the licensee having no right to assign
• For new tenancies entered into after 9 July 2004, security of tenure under Part IV of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) has been abolished and such tenancies are governed by common law only

• Each place of business must be under the 'effective and independent' control of an appointed manager (Estate Agents Ordinance, s. 38(1)(a)).
• A branch manager must hold an estate agent's licence; a licensed salesperson does not satisfy this requirement.
• The same person cannot simultaneously act as manager of two places of business, as this would violate the requirement for 'independent control'.
• Length of service is not a determining factor; what matters is the type of licence held by the individual.

• A separate business details statement must be applied for in respect of each place of business and business name (Licensing Regulation, s.10).
• The appointment or revocation of appointment of a manager must be notified to the Authority within thirty-one days (Estate Agents Ordinance, s.40).
• There is no requirement to separately notify the Authority merely because a new branch has commenced operation.
• Not every director is required to hold an estate agent's licence; however, at least one director must be licensed, and any director who carries on estate agency work must be individually licensed (s.20).

• Under the Estate Agents Authority's Practice Circular on anti-money laundering, practitioners who suspect a transaction involves money laundering must file a suspicious transaction report with the Joint Financial Intelligence Unit (JFIU).
• The JFIU is the designated body responsible for receiving and analysing suspicious transaction reports in Hong Kong.

• Estate agency managers are required to monitor FATF statements and apply enhanced due diligence for high-risk jurisdictions.
• For corporate clients, the authorised signatory's name and identity document details must be recorded in the estate agency agreement.
• Estate agency agreements must clearly set out the property address, agreed transaction price, and date of the relevant provisional agreement for sale and purchase.
• Estate agency agreements must be retained for a minimum of five years from the date of the relevant provisional agreement for sale and purchase.
• There is no legal requirement to submit copies of all estate agency agreements to the Hong Kong Police Force.

• A branch manager has a duty to prohibit the use of pirated or unauthorised software within the branch.
• A branch manager must establish and implement IT security procedures to mitigate potential IT security risks.
• When engaging IT outsourcing service providers, a branch manager should ensure that contracts include provisions protecting the confidentiality of computer system data.
• All three measures — prohibiting pirated software, establishing IT security procedures, and including confidentiality provisions in outsourcing contracts — are necessary and appropriate steps for a branch manager to take.

• Under the Estate Agents Ordinance (Cap. 511), management must ensure that the business of each office is conducted under the effective and independent supervision of one manager.
• Management must not appoint any unlicensed person to perform estate agency work.
• There is no requirement that the person witnessing the signing of a provisional agreement for sale and purchase must hold an estate agent's licence.
• When a salesperson or licensed estate agent is assigned to another branch, there is no obligation to notify the Estate Agents Authority (EAA) of such reassignment.

• Under the relevant provisions, matters requiring notification to the Estate Agents Authority include the employment of a salesperson, the appointment of a branch manager, and the appointment of a director of the company.
• The internal transfer or redeployment of a salesperson between branches does not constitute a matter requiring notification to the Estate Agents Authority.

• Employing an unlicensed person to carry out estate agency work may simultaneously give rise to three categories of consequences: disciplinary action by the Estate Agents Authority, civil liability to any person who suffers loss, and criminal prosecution under the Estate Agents Ordinance.
• All three consequences may apply concurrently and are not mutually exclusive.

• Estate agents must perform Customer Due Diligence (CDD) procedures, including verifying the client's identity, residential address and source of funds (s. 8.2.9).
• Identifying and verifying the beneficial owner is a key step in anti-money laundering compliance, particularly in transactions involving corporate structures or trust arrangements.
• Ongoing monitoring of business relationships and identification of suspicious transaction characteristics (such as unusual transaction patterns or atypical payment arrangements) is a statutory requirement.
• Under the Organized and Serious Crimes Ordinance (Cap. 455), an estate agent who knows or suspects that a transaction is connected with money laundering must file a Suspicious Transaction Report (STR) with the Joint Financial Intelligence Unit.

• An employer may incur vicarious liability for acts committed by an employee "in the course of employment" (s. 8.1.3).
• Even without express authorisation, if the employee's act falls within the general scope of duties, the employer may still be held liable. Therefore, statement (ii) is incorrect (s. 8.1.2).
• If Chi-ming's conduct falls within the general scope of his agency duties, the company may be liable for the client's resulting loss (s. 8.1.4).
• The EAA has the power to take disciplinary action against an estate agency firm for failure to properly manage and supervise its salespersons (s. 8.2).

• Under section 37 of the Estate Agents Ordinance (Cap. 511), licensees must properly maintain business records; however, the statutory retention period is three years, not six years.
• The EAA's advertising guidelines require that all property advertisements must state the licence number of the licensee responsible for the advertisement, which is a correct compliance requirement.
• In relation to anti-money laundering measures, once a licensee suspects a client of involvement in money laundering, the licensee must NOT tip off the client, as doing so is an offence that may constitute complicity in a money laundering crime.
• Under CPD requirements, a licensed estate agent must complete a minimum of 15 CPD credits per CPD cycle, of which at least 3 credits must come from core subjects — this statement is correct.

• Under section 37 of the Estate Agents Ordinance (Cap. 511), a licensed estate agent (including those serving as branch managers) is responsible for supervising the practice conduct of salespersons under their charge; failure to properly fulfil this supervisory duty may result in disciplinary liability.
• Under sections 38 and 39 of the Estate Agents Ordinance (Cap. 511), the EAA has the power to investigate the conduct of both licensed estate agents and licensed salespersons and may take appropriate disciplinary action; receiving commission from both parties without disclosure constitutes a breach of the Code of Practice.
• Upon becoming aware, or having reasonable grounds to believe, that a salesperson under their charge has breached practice requirements, a licensed estate agent should proactively report the matter to the EAA to fulfil their obligations as a licensee.

• Under section 37 of the Estate Agents Ordinance (Cap. 511), a licensed estate agent intending to open a new place of business is required to notify the EAA, but is NOT required to obtain prior approval before commencing business; statement (i) is therefore incorrect.
• Under section 38 of the Estate Agents Ordinance (Cap. 511), each place of business must have a licensed estate agent (individual) appointed as its manager; statement (ii) is correct.
• Professional indemnity insurance must cover the business activities of all offices of the licensed estate agent; provided the existing policy extends to the new branch, no separate policy for each individual branch is required; statement (iii) is correct.
• Under section 39 of the Estate Agents Ordinance (Cap. 511), a licence must be displayed in a conspicuous place at the office premises for public inspection; statement (iv) is correct.

• Under section 65(1) of the Personal Data (Privacy) Ordinance (Cap. 486), an act done by an employee in the course of employment is deemed to have been done by the employer, and the employer is vicariously liable even without knowledge of the act.
• Under section 15 of the Estate Agents (Licensing) Regulation (Cap. 511B), an estate agency firm must establish procedures to supervise employees' compliance with relevant legislation.
• An estate agency firm is vicariously liable for acts of its agents or salespersons done in the course of employment, even if the employee is engaged on a commission-only basis — this does not exempt the firm from liability.

• Vicarious liability: an employer is liable for employee acts done in the course of employment, even without knowledge. An EA firm is liable for its agent/salesperson's acts even if the salesperson is engaged on a commission-only basis.
• Section 36(1)(a) of the Estate Agents Ordinance (Cap. 511) requires estate agents to disclose any pecuniary interest and any benefit arising from a sale.
• Under section 15 of the Estate Agents Practice (General Duties and Hong Kong Residential Properties) Regulation (Cap. 511B), an estate agent must establish procedures to supervise employees' compliance.

• An employer is vicariously liable for the acts of employees carried out in the course of employment, even if the employee is engaged on a commission-only basis. Lack of knowledge is not a defence.
• Under the Estate Agents Ordinance (Cap. 511) s.36(1)(a), an agent must disclose pecuniary interests in a property to clients. Practice Regulation s.15 requires a branch manager to proactively establish procedures to supervise employees' compliance, not merely react after receiving complaints.
• Under Cap. 511 s.38, a branch manager must exercise 'effective and independent' control over the branch's operations — this is an ongoing obligation.

• Under s.36(1)(a) of the Estate Agents Ordinance (Cap. 511), when acting for both parties, the agent must inform both sides and share information upon request; notifying only one party is insufficient.
• Under s.15 of the Estate Agents (Licensing) Regulation (Cap. 511B), a licensed estate agent must establish procedures to supervise employees' compliance. A branch manager's failure to establish any supervisory procedures is itself a breach.
• Under the Employment Ordinance, summary dismissal (without notice) is only justified in serious cases such as wilful disobedience, misconduct, fraud, or habitual neglect. Since Suk-Yi has passed the first month of probation, a single compliance breach generally does not justify summary dismissal; Ka-Chun must give one month's notice or payment in lieu.
• An EA firm is vicariously liable for the acts of its salespersons in the course of employment, even without prior knowledge.

• Under Employment Ordinance s.11AA, a year-end payment is presumed non-discretionary unless expressly stated otherwise in writing in the employment contract
• Under the Employment Ordinance, wages must be paid within 7 days after the end of the wage period; the company paying on 12 January for a wage period ending 31 December exceeds the 7-day limit
• Under the Estate Agents (Licensing) Regulation (Cap. 511B) s.15, licensed estate agents must establish procedures to supervise employees' compliance with relevant legislation, including employment law

• Under the Partnership Ordinance s.7, each partner is an agent of the firm and contracts within a partner's authority bind the firm
• Under the Partnership Ordinance s.11, each partner is jointly liable for ALL partnership debts with unlimited liability
• A partnership is NOT a body corporate and has no separate legal identity, unlike a limited company

• Under the Employment Ordinance, during the first month of probation, either employer or employee may terminate the contract without notice or payment in lieu of notice.
• After the first month of probation, where there is no special agreement, either party must give not less than 7 days' notice or payment in lieu to terminate.
• Under the Estate Agents (Licensing) Regulation (Cap. 511B) s.15, licensed estate agents must establish procedures to supervise employees' compliance with the law, including proper handling of employment matters.

• Under section 11AA of the Employment Ordinance, a year-end payment is presumed to be non-discretionary unless the employment contract expressly states in writing that it is discretionary
• If an employer wishes to retain discretion over year-end payments, it must be clearly stated in writing in the employment contract; otherwise the payment is presumed non-discretionary by law even if the employer claims it is discretionary

• Under Employment Ordinance s.11AA, year-end bonus is presumed non-discretionary unless expressly stated otherwise in writing in the employment contract
• Under Partnership Ordinance s.7, each partner is an agent of the firm and contracts made within the partner's authority are binding on the firm
• A partnership is not a body corporate and has no separate legal identity; under Partnership Ordinance s.11, each partner is jointly liable for all partnership debts (unlimited liability)

• Under Part VIA of the Personal Data (Privacy) Ordinance (Cap. 486), consent must be obtained BEFORE using personal data for direct marketing; if consent is given orally, it must be confirmed in writing within 14 days
• The data subject has the right to opt out at ANY time, and the organisation must maintain a do-not-call list (ref. Practice Circular 13-05(CR))
• Under Practice Regulation s.15 (Cap. 511B), licensed estate agents must establish procedures to supervise employees' compliance with regulations, including privacy requirements

• Even if a salesperson is paid on a pure commission basis with no base salary, the relationship between an estate agency firm and its agent/salesperson is still regarded as employer-employee, and the employer bears vicarious liability for employee acts in the course of employment
• Under the Employment Ordinance, eligibility for statutory holiday pay requires a continuous contract of 3 months or more (not 12 months), so Nga-Ting at 8 months already qualifies
• Under the Partnership Ordinance s.11, each partner is jointly liable for ALL partnership debts (unlimited liability); s.7 provides that each partner is an agent of the firm

• Companies Ordinance s.154 provides that a sole director of a private company CANNOT also serve as the company secretary.
• Estate Agents (Licensing) Regulation (Cap. 511B) s.12 requires that client money be deposited into a trust account at an authorised institution (s.12(3),(4),(5)); agents should instruct clients to make cheques payable to the seller/landlord's solicitor, not to the agency itself.

• EAO (Cap. 511) s.36(1)(a)(vii) requires that when an estate agent acts for both buyer and seller, both clients must be informed, and information from one must be provided to the other on request unless that client expressly prohibits it. Hiu-lam only notified the buyer but not the seller, breaching this disclosure requirement.
• Even if a salesperson is paid on a commission-only basis with no base salary, the relationship between an EA firm and its agent/salesperson is an employer-employee relationship, and the employer bears vicarious liability for employees' acts in the course of employment.
• Under the Employment Ordinance, there are exactly 12 statutory holidays. An employer cannot substitute payment for a holiday — the employee must be given the day off or an alternative day. Holiday pay eligibility requires a continuous contract of at least 3 months, calculated as average daily wages over the preceding 12 months.
• A continuous contract is defined as employment with the same employer for 4+ consecutive weeks with at least 18 hours per week. Hiu-lam works 6 days a week, 8 hours a day, clearly meeting this definition.

• Under the Estate Agents (Licensing) Regulation (Cap. 511B) s.12, client money must be deposited into a trust account at an authorised institution (s.12(3),(4),(5)), and clients should be instructed to make cheques payable to the vendor's or landlord's solicitor, not the agency firm
• Under the Employment Ordinance, employers must keep wage records for the past 12 months; keeping only 6 months is non-compliant

• Part VIA of the Personal Data (Privacy) Ordinance (Cap. 486) requires consent to be obtained BEFORE using personal data for direct marketing; oral consent must be confirmed in writing within 14 days; data subjects may opt out at any time
• Partnership Ordinance s.7: each partner is an agent of the firm and contracts within authority bind the firm; s.11: each partner is jointly liable for ALL partnership debts (unlimited liability)