Hong Kong Ordinances

TRUSTEE ORDINANCE - SECT 22

Application of insurance money where policy kept up under any trust, power or obligation

(1) Money receivable by trustees or any beneficiary under a policy of
insurance against the loss or damage of any property subject to a trust,
whether by fire or otherwise, shall, where the policy has been kept up under
any trust in that behalf or under any power statutory or otherwise, or in
performance of any covenant or of any obligation statutory or otherwise, or by
a tenant for life impeachable for waste, be capital money for the purpose of
the trust as the case may be.

(2) If any such money is receivable by any person, other than the trustees of
the trust, that person shall use his best endeavours to recover and receive
the money, and shall pay the net residue thereof after discharging any costs
of recovering and receiving it, to the trustees of the trust, or, if there are
no trustees capable of giving a discharge therefor, into court.

(3) Any such money-

   (a)  if it was receivable in respect of property held upon trust for  sale,
        shall be held upon the trusts and subject to the powers and provisions
        applicable to money arising by a sale under such trust;

   (b)  in any other case, shall be held upon trusts corresponding as nearly
        as may be with the trusts affecting the property in respect of which
        it was payable.

(4) Such money, or any part thereof, may also be applied by the trustees, or,
if in court, under the direction of the court, in rebuilding, reinstating,
replacing, or repairing the property lost or damaged, but any such application
by the trustees shall be subject to the consent of any person whose consent is
required by the instrument, if any, creating the trust to the investment of
money subject to the trust.

(5) Nothing contained in this section shall prejudice or affect the right of
any person to require any such money or any part thereof to be applied in
rebuilding, reinstating, or repairing the property lost or damaged, or the
right of any mortgagee, lessor, or lessee, whether under any statute or
otherwise.

(6) This section applies to policies effected either before or after the
commencement of this Ordinance, but only to money received after such
commencement. [cf. 1925 c. 19 s. 20 U.K.]