SQE Other ordinances in agency practice question: Conveyancing and Property Ordinance Cap

EAA SQEOther ordinances in agency practice

Mrs Wong Siu-lan orally grants Mr Arjun Patel a 5-year lease of a ground-floor shop in Yau Ma Tei. Mr Patel pays her a HK$200,000 premium in cash plus the first month's rent and moves in. Nothing is signed. Under section 6 of the Conveyancing and Property Ordinance (Cap. 219), what does Mr Patel hold?

A An interest at will only, despite the consideration paid, because the lease was created by parol and is not covered by section 6(2)
B A valid 5-year lease, because he has gone into possession and has paid both a premium and rent, which is sufficient consideration
C A valid lease for the first 3 years only, with the remaining 2 years taking effect as a periodic monthly tenancy
D Nothing at all, and Mrs Wong must refund the premium, because an oral grant of a lease is void under section 4

Show the answer and explanation

Answer: A. An interest at will only, despite the consideration paid, because the lease was created by parol and is not covered by section 6(2)

Answer: An interest at will only. Section 6(1) says interests in land created by parol and not put in signed writing have the force and effect of interests at will only, 'notwithstanding any consideration having been given'. Why not the others: - A valid 5-year lease: Possession and payment do not cure the lack of writing under section 6. The section 6(2) exception is not available: the term exceeds 3 years and a premium was paid. - Valid for 3 years, then periodic: The Ordinance does not split the term like this. The parol interest takes effect as an interest at will. - Nothing at all, under section 4: Section 4 requires a deed to create a legal estate, but section 6(1) itself gives a parol interest the effect of an interest at will. Whether the premium is recoverable is a separate question of contract and restitution. Rule: A parol lease outside section 6(2) (term over 3 years, or a premium, or not at the best rent) has effect as an interest at will only, whatever consideration was given. Source: Conveyancing and Property Ordinance (Cap. 219), sections 4, 6(1) and 6(2); as at Oct 2026

Common mistake

Assuming possession plus payment makes an oral lease of more than 3 years with a premium valid.

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An original question written to the published SQE syllabus. Figures in the explanation carry their effective dates; check them against the current law before relying on them. Independent exam practice. Not affiliated with or endorsed by the Estate Agents Authority (EAA) or the examination administrator.