Ms Cheung was a public housing tenant who would like to purchase a flat in the HOS Secondary Market Scheme. She had already applied to the Housing Authority for a "Certificate of Eligibility to Purchase". She instructed an estate agency to look for a suitable flat, and signed an estate agency agreement. Not long afterwards, an agent took her to view a flat with which she was quite pleased. At the time the vendor had not obtained a "Certificate of Availability for Sale" but said that he would obtain one as soon as possible, Ms Cheung thereupon signed a provisional agreement for sale and purchase with the vendor but left the space for the date of signing blank. She also drew a cheque in the amount of $10,000 for the deposit, to be held by the agent for the time being.
A few weeks later, Ms Cheung asked the agent whether the vendor had obtained a Certificate of Availability for Sale, but the agent said that he had not been able to contact the vendor. After further questioning, she discovered that the vendor had sold the flat to a higher bidder through another estate agency. Ms Cheung then demanded compensation from the vendor, but the latter refused on the ground that he had not received her deposit and no date had been affixed to the agreement.
Ms Cheung then sought legal advice and was told that as the vendor had not obtained a Certificate of Availability for Sale at the time of the signing of the agreement, the agreement would be void. Ms Cheung finally gave up demanding compensation from the vendor.
In a resale of an HOS flat, the Estate Agents Authority recommends that the parties should not sign any agreement until all the necessary documents are ready. The Housing Ordinance (Cap. 283 of the Laws of Hong Kong) provides that without the written consent of the Housing Authority, agreement purporting to alienate any property under the Housing Ordinance shall be void and anyone signing such an agreement will have committed an offence. Therefore, anyone who wants to sell a flat under the HOS or the Private Sector Participation Scheme in the HOS Secondary Market Scheme, or anyone who is qualified and plans to buy such a flat, should exercise caution.
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