The Interplay Between Birthright Membership and the Limitation Period: Why Adverse Possession Claims Against Business T'ongs with Tso Members May Never Succeed

(A) Introduction
 
In Man Chung Lap v. Man Shui Tong Wui with Man Ping-name and Man Tai-sang as Managers, HCA 1736/2024, date of judgment: 13 March 2026, [1] the Court addressed an interesting and novel question of law, namely, under customary Chinese laws which are an integral part of the general body of Hong Kong laws, whether the undisputed legal principle that the limitation period runs afresh in adverse possession claims against a tso where a new member of the tso is born, which creates a new equitable interest in the tso property extends and applies to a business t’ong with a tso as one of its members. [2]
 
The Plaintiff claimed to have acquired a piece of land in the New Territories by adverse possession. The Defendant argued that as its membership includes several ancestral tsos, the birth of new male descendants into those tsos after the Plaintiff took possession created new equitable interests in the land. This prevented the limitation period from ever expiring. 

Ultimately, the Court struck out the Plaintiff’s action on the ground that the limitation period for an adverse possession claim against the Defendant could never expire.
 
(B)  Facts
 
The Plaintiff is and was at all material times a member of San Yeah Tso (莘野祖), an ancestral tso .  The Defendant, Man Shui Tong Wui (文水塘會, the “Wui”), is a business t'ong whose membership consisted and still consists of ancestral tsos/t'ongs, business t'ongs, individuals (including male and females), and a limited company. Its managers are Man Ping Nam and Man Tai Sang. The Wui’s members include 18 ancestral tsos, two of which are San Yeah Tso (莘野祖) and Yee Fong Tung Sheung Tso (二房通常祖). [3]
 
In 1986, the Wui granted a 10-year tenancy to four tenants, including Man Ching Yip (文正業), father of Man Whi Chung (文偉昌), in respect of all its land lots (consisting of 48 Dam (擔) in area, including the disputed lot) for use as fishponds (the “1986 Tenancy”). [4] The Plaintiff accepted the 1986 Tenancy at face value and that it was performed by the 4 tenants and their successors. However, he maintained his claim to have adversely possessed the land for over 20 years or 12 years since sometime on 1 July 1991. [5]
 
On 29 August 2024, the Plaintiff issued a writ against the Defendant claiming adverse possession of the disputed land lot “since the late 1990s”. [6]
 
Subsequently, the Defendant applied to strike out the claim under Order 18, rule 19 of the Rules of the High Court on the ground that the limitation period for an adverse possession claim against the Wui could never expire. [7] New male descendants were born into the member tsos on 23 January 1990, 12 February 1991, 20 September 1992, 24 February 1993, 7 December 1994, 6 September 1999, 17 October 2006 and 4 August 2016, with no gap of 12 years between any of them. [8] As each birth created a new equitable interest in the Wui’s land and therefore a new right of action to recover it. The limitation period was prevented from ever running its course.
 
(C) Decision
 
The Court struck out the Plaintiff’s claim on the ground that the limitation period for an adverse possession claim against the Wui could never expire. Its reasonings was as follows:

(1) The Nature of the Wui: The Court held that the Wui is a business t'ong on the ground that it was formed for a profit-making purpose as evidenced by the bi-annual distribution of rental income from leasing out its landed properties and it has a non-ancestral membership, which includes females and a limited company as well as members of the Wui having definite and freely transferrable shares of interest. [9] 

(2) Beneficial Ownership: The Court held that the members of a business t’ong are the beneficial owners of its property. [10] Given that a tso (for example, San Yeah Tso) is not a legal entity captioned of holding property in its own property interests directly, its individual members directly hold this beneficial interest in the Wui’s land. [11]

(3) Application of the Wui: The Court applied the principle from Leung Kuen Fai v Tang Kwong Yu (or U) T'ong or Tang Kwong Yu Tso [2002] 2 HKLRD 705, which held that for a tso, a new equitable interest in the land is created each time a male descendant is born, starting a fresh limitation period, to the Wui (a business t’ong with a tso as its member).  Although the Wui itself is a business t'ong with freely transferable shares, the presence of tsos as its members was decisive because a tso itself is not a legal entity capable of holding property in its own right. Instead, it is a collective body whose members are the ultimate beneficial owners of any property held in the tso’s name. Where a tso holds a membership interest in a business t'ong, the individual members of that tso are the true beneficial owners of the t'ong's underlying assets. As such, when a new male is born into a member tso, that person automatically acquires a direct beneficial interest in the Wui's land. This creates a new equitable interest in the land and a new right of action to recover the land. Each such birth resets the limitation period. [12]

(4) Factual Findings: The Court found that the eight male descendants were born to the member tsos between 1990 and 2016, with no gap of 12 years between any of these births. As such, the limitation period had never expired. [13]
 
(D) Key Takeaways
 
This case demonstrates the interplay between Chinese customary law (the nature of tsos and birthright membership) and the Limitation Ordinance. The Court clarified that it is impossible to acquire land by adverse possession against a business t’ong if one of its members is an ancestral tso (or, by extension, any hereditary body). As long as new males continue to be born into the member tso, the limitation period will restart perpetually.

 
In light of the above, this case provides helpful guidance for claimants considering adverse possession against any land in the New Territories. Claimants should:

(1) Investigate the registered owner and its constituent members. If the registered owner is a t'ong, ascertain whether any of its members are tsos or other hereditary bodies. If it is a business t'ong with a tso as a member, the limitation period may never expire. The birth of any male descendant into that tso, even decades after the claimant took possession, will reset the clock.

(2) Verify whether any males have been born into the member tso during the claimant’s period of possession.  In particular, ascertain whether there is any gap of 12 years or more between such births, as continuous births without such a gap will defeat the claim.

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[1] https://legalref.judiciary.hk/doc/judg/word/vetted/other/en/2024/HCA001736_2024.doc

[2] Man Chung Lap v. Man Shui Tong Wui with Man Ping-name and Man Tai-sang as Managers, HCA 1736/2024, date of judgment: 13 March 2026, §1

[3] Ibid, §4

[4] [Ibid, §6

[5] [Ibid, §5

[6] [Ibid, §6

[7] [Ibid, §2

[8] [Ibid, §6

[9] [Ibid, §11

[10] [Ibid, §42

[11] [Ibid, §47

[12] [Ibid, §52

[13] [Ibid, §63