Raymond T.L. Tse & Co., Solicitors

Most multi-storey buildings have setup Incorporated Owners (commonly called "I/O") under Buildings Management Ordinance, Chapter 344 of the Laws of Hong Kong for the purpose of managing, either by themselves or through management company, the common parts of the whole building or entire estate.

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I/O has a legal entity and it has various statutory powers and duties under Cap. 344 as well as various contractual powers/duties laid down by the Deed of Mutual Covenant (called "DMC") of the building/estate in relation to common parts.

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Thus, I/Os could sue defaulting unit owners for violating the terms of the Deed of Mutual Covenant. Most typical litigations commenced by I/Os are claiming defaulting unit owners for arrears of management fees or outstanding contributions towards major renovation charges. Once I/Os obtain awards/judgments from the Court, they could also register a charge in the Land Registry against the share and interest of the property unit/car park of the defaulting unit owners. In extreme cases, I/Os can apply to Court to sell the property unit/car park and use the net proceeds of sale to defray against the outstanding arrears, interest and legal costs.

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Conversely, I/Os can be sued by unit owners or third party(s) who suffer loss and damage caused by their tort following I/O's negligent upkeep of the common parts of the building, say in a water leakage situation or fallen debris from common parts. If you are in doubt whether you can bring a law suit against an I/O to recover your loss and damage, you are welcome to contact us for legal advice.

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