1 - You MUST answer this question (50 MARKS) This question involves a residential property known as Flat A, Ground Floor, Tycoon Villa, 11 Hill Road, Hong Kong (the "Property"). Tycoon Villa was built in the year 1992 and it is a 15-storey building with a single residential unit on each floor. The Property is located on the ground floor of Tycoon Villa and includes a large back yard. Annie & Bob Annie purchased the Property in 2000 and registered it in her sole name. She lived in the Property with her husband Bob and their two young children. Annie worked as a museum curator specializing in medieval Japanese culture, a topic which she was very passionate about. In order to satisfy her passion for medieval Japanese culture, she renovated the Property and had a beautiful Zen rock garden (the "Zen Garden") built in the back yard. The Zen Garden is made up of a large patch of sand and gravel which is carefully raked to create patterns representing ripples of water like an ocean. The Zen Garden also has several carefully arranged rocks and stone ornaments representing islands on the ocean of sand and gravel. In the middle of the Zen Garden was a large immovable stone pedestal which was built into the ground with cement. On the pedestal, Annie had placed a large marble statue of a samurai warrior (the "Statue") which she had purchased at an auction. The Statue was very heavy and it had to be lifted by a small crane when it was first placed onto the pedestal in the Zen Garden. The Statute rested on the pedestal by its own weight and it was not attached to the pedestal in any way. The Statute has stood on the pedestal since it was first placed there in 2000 and has not been moved since then. Cindy Cindy is a wealthy businesswoman and an avid art and antiques collector. In 2019, Annie hosted a dinner party at the Property for a number of very important donors and benefactors of her museum. Cindy was one of the guests at the party. During the party, the guests ate and drank wine and socialized in the back yard of the Property. Cindy was very impressed by the Zen Garden and spent a lot of time examining the Statute which she found fascinating. Unfortunately, Cindy had a few too many drinks that evening and she tripped and fell on the rocks and landed on the stone pedestal. She was unhurt but a large diamond, worth an estimated HK$300,000, had broken off of her bracelet (the "Diamond") and fell into a crack in between the Statute's toes without anyone noticing. A few days later, Cindy realized that the Diamond was missing. She searched for it and even asked Annie if she had seen her Diamond as it might have been lost at the Property, however no one was able to find it. Cindy reported the missing Diamond with the Police and asked them to help keep a lookout for it. Danny, Ellie & Fred Danny was in the market to buy a new home. His wealthy mother Ellie suggested a plan to help him buy a home. Ellie suggested that she would provide Danny with the purchase money for the home which would then be registered in his sole name. She said that she wanted to make it look like she did not have any assets in her name so that she could qualify for various Govemment welfare benefits. Danny agreed with Ellie's plan and he engaged a property agent, Fred, to help look for a property. Recently, Annie decided to put the Property up for sale as she wanted to move to a different part of Hong Kong. Yesterday, Fred took Danny to inspect the Property. When Danny and Fred arrived at the Property, a domestic helper let them in for the inspection. Fred told Danny that the registered owner, Annie, was not home. During the inspection, Danny was extremely impressed by the Property and immediately decided that he wanted to purchase it. In particular, he noticed the following: Danny was particularly impressed by the Zen Garden and the Statue. He was also passionate about medieval Japanese culture and a crucial factor in deciding that he wanted to buy the Property was that he thought that the Zen Garden and the Statute would be included in the purchase price. Fred knew that Annie lived at the Property with her husband Bob and two children. However, Fred never mentioned this to Danny. While inspecting the Property, Danny noticed throughout the Property there were lots of children's toys scattered everywhere and there were many family photos of Annie, Bob and the two children on the walls. Danny also noticed that a large flower rack had been drilled into the external wall of the building outside the living room window. However, none of the other flats in Tycoon Villa had anything installed on the external wall outside of their living room windows. That evening, Danny negotiated with Annie through Fred and they agreed on a price of HK$40 million for the sale and purchase of the Property. Ellie transferred the HIK$40 million to Danny which he would use to pay for the Property. Fred drafted the Provisional Sale and Purchase Agreement (the "PA") for Danny to sign. The PA included the following clause: "Clause 8 - The Purchaser agrees and accepts all existing conditions of the Property and shall not refuse to complete the transaction or to raise any objections. For avoidance of doubt, this includes the flower rack that has been drilled into the external wall of the Property outside of the living room window." Continuing on from the same facts as above, assume that Danny signed the PA, completed the purchase with Ellie's money and was registered as the sole owner of the Property. A few months later, Danny signed a contract with a construction company to hire them to do some renovation work on his back yard. While doing the renovations, one of the company's employees, a worker named George, spotted the Diamond hidden between the toes of the Statue. Rather than informing his company or Danny, George instead put the Diamond in his pocket and later that day he brought it to the Police station to report it as lost. George left his name and contact details with the Police in case they could not find the owner so that he could come back to collect it. During the Police investigations, Annie, Cindy, Danny, Ellie and the construction company all became aware of the Diamond as well. Now, Annie, Cindy, Danny, Ellie, the construction company and George have demanded to the Police that the Diamond be returned to them. Based on the topics we have covered in this course, discuss any property law issues in relation to the above