Tenancy agreement – parties signed agreement and then another agreement at higher rent – whether first or second agreement prevailed – effect of non-stamping of first agreement – both agreements stamped after second agreement entered into – whether respective dates of stamping relevant
In March 2016, T and L renewed a tenancy agreement for two years from 18 March 2016 at HK$18,000 per month (the “March Tenancy”). The Stamp Duty Office rejected T’s attempt to stamp the March Tenancy, because L’s company chop was missing from it. T initially paid three months’ rent and, in July 2016, paid four months’ rent to L. T agreed in August 2016 to another tenancy agreement at HK$19,000 per month from 18 August 2016 for two years (the “August Tenancy”). In September 2016, L had the August Tenancy e-Stamped via eTax, even though it did not bear L’s company chop. In December 2016, T had the March Tenancy e-Stamped, informed L and asserted that the March Tenancy prevailed. L applied for vacant possession of the premises based on “the current, valid tenancy agreement”, alleging that T had been underpaying rent by HK$1,000 per month under “an old, void tenancy agreement”.
Held, that the August Tenancy was binding on T, that:
- Both parties treated the March Tenancy as binding notwithstanding that T had not had it stamped. Under s. 6 of the Conveyancing and Property Ordinance (Cap. 219), the March Tenancy, being for a term not exceeding three years, the lease could be created by parol without being put in writing. Even though the tenancy was unstamped, it could still be of legal effect. On T accepting its terms on 5 March 2016, it should have taken effect for two years from 18 March 2016.
- However, the August Tenancy took effect on 18 August 2016 and had superseded the March Tenancy. T had signed the August Tenancy voluntarily and had not shown any ground amounting to duress enabling her to avoid it. Further, as the respective tenancies took effect immediately on being signed, the date of stamping was irrelevant. The March Tenancy could not be resurrected by its more recent stamping.
- Accordingly, the August Tenancy was binding on T who should make pay all arrears of rent/mesne profits payments, failing which she must deliver vacant possession of the premises to L.