CHAN OI KWAN, one of the beneficiaries of the Estate of CHAN YUEN, deceased v. CHAN FU WING,the administrator of the Estate of CHAN YUEN, deceased

HCMP 2211/2019

[2022] HKCFI 3603

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 2211 OF 2019

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DECISION

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1.  By Summons dated 8 June 2022 (“Summons”), the Plaintiff seeks leave to appeal the Order made on 26 May 2022 whereby costs of the trial of the Plaintiff’s Originating Summons in this matter were summarily assessed at HK$800,000. I handed down reasons for decisions on costs on 27 June 2022 (“Costs Decision”) [2022] HKCFI 1933. This decision should be considered together with those reasons.

2.  The hearing of the Summons was originally listed before me on 6 September 2022.  The skeleton submissions for the Plaintiff, acting by counsel, were only served on the Court and the Defendant the day before. The Defendant did not have time to consider the relevant arguments and whether he wished to instruct counsel.  The matter was thus adjourned, with costs consequences for the Plaintiff, to allow the Defendant to consider his position.  The parties eventually agreed that the application should be disposed of on paper, and directions were given accordingly.

3.  There is no great dispute between the parties as to the principles to be applied:

(1)  Leave to appeal will not be granted unless the court is satisfied that the intended appeal has a “reasonable prospect of success”.  That means a prospect that is more than “fanciful” but without having to be “probable”.  

(2)  The Court of Appeal will not interfere with the exercise of a judge’s discretion in the award of costs unless it is shown that he failed to exercise the discretion, or exercised it upon a false principle, or did not exercise it judicially.  An appeal against the exercise of discretion will not be entertained unless it is shown that the discretion was not exercised at all, or that the judge made some error of law or facts or that the decision was “plainly wrong” or was “outside the generous ambit within which a reasonable disagreement is possible”.

(Waddington Ltd v Chan Chun Hoo Thomas & ors, HCMP 1326/2017, 18 October 2017, §§3-4, per Kwan JA (as she then was); Poon Shu Fan v Wong Tin Yan & Anor [2012] 5 HKLRD 512 (CA) at §10).

4.  The key points made by the Plaintiff in support of her application are as follows.

5.  First, it is submitted that I erred in law in allowing a global sum that was disproportionate and unreasonable. In support of this, the Plaintiff refers to the case of Poon Shu Fan at §§14-18, which in turn refers to the English Civil Procedure Rules at 44.3(5). I note the following passage from Poon Shu Fan:

“15. Whilst there are obvious differences between our post Civil Justice Reform rules and the English rules under the Woolf’s Reform, the approach in England, as explained by Lord Woolf CJ in Lownds v Home Office [2002] 1 WLR 2450, nonetheless provides valuable guidance in this area. In paragraph 31, Lord Woolf spelt out a two‑stage approach:

“          In other words what is required is a two‑stage approach.  There has to be a global approach and an item by item approach.  The global approach will indicate whether the total sum claimed is or appears to be disproportionate having particular regard to the considerations which CPR r 44.5(3) states are relevant.  If the costs as a whole are not disproportionate according to that test then all that is normally required is that each item should have been reasonably incurred and the cost for that item should be reasonable.  If on the other hand the costs as a whole appear disproportionate then the court will want to be satisfied that the work in relation to each item was necessary and, if necessary, that the cost of the item is reasonable.  If, because of lack of planning or due to other causes, the global costs are disproportionately high, then the requirement that the costs should be proportionate means that no more should be payable than would have been payable if the litigation had been conducted in a proportionate manner.  This [in] turn means that reasonable costs will only be recovered for the items which were necessary if the litigation had been conducted in a proportionate manner.”

16. The judge then went on to emphasise that “a sensible standard of necessity” has to be adopted (para 37) :

“  Although we emphasise the need, when costs are disproportionate, to determine what was necessary, we also emphasise that a sensible standard of necessity has to be adopted.  This is a standard which takes fully into account the need to make allowances for the different judgments which those responsible for litigation can sensibly come to as to what is required.  The danger of setting too high a standard with the benefit of hindsight has to be avoided.  While the threshold required to meet necessity is higher than that of reasonableness, it is still a standard that a competent practitioner should be able to achieve without undue difficulty.  When a practitioner incurs expenses which are reasonable but not necessary, he may be able to recover his fees and disbursements from his client, but extra expenses which results from conducting litigation in a disproportionate manner cannot be recovered from the other party.”

17. The judge then explained how the conduct of the paying party may affect what is and what is not necessary (para 38) :

“ In deciding what is necessary the conduct of the other party is highly relevant. The other party by co‑operation can reduce costs, by being unco‑operative he can increase costs. If he is uncooperative that may render necessary costs which would otherwise be unnecessary and that he should pay the costs for the expense which he has made necessary is perfectly acceptable. Access to justice would be impeded if lawyers felt they could not afford to do what is necessary to conduct the litigation. Giving appropriate weight to the requirements of proportionality and reasonableness will not make the conduct of litigation uneconomic if on the assessment there is allowed a reasonable sum for the work carried out which was necessary.””

6.  It was the Plaintiff’s position that the global sum claimed by the Defendant (of HK$1,351,649) was disproportionate at the outset, and therefore, that a stricter test of reasonableness and necessity should have been applied rather than the usual test of reasonableness.  It was further submitted that I had not followed the two-stage test set out in Poon Shu Fan.

7.  This is not the occasion on which to expand upon my reasoning in the Costs Decision.  I would, however, point out that for the reasons I have set out in the Costs Decision, I considered the sum assessed to be a reasonable and proportionate one overall (see in particular §§8-10 of the Costs Decision).  Further, I also considered the costs on an item-by-item basis, and in that context had commented on items which I considered were required (and by implication, necessary) (§§6-7 and §9 of the Costs Decision).

8.  I would further note that the claimed sum of HK$1,351,649 had been substantially reduced to HK$800,000 (i.e. over 40% reduction on the original costs).

9.  In the circumstances, I do not consider that the discretion so exercised was exercised in an erroneous manner.

10.  Second, it was submitted that I erred in law in failing to apply the proper approach for summary assessment of costs, in that I failed to consider the reasonableness of each item.  This ground of the application applied to my approach towards Items C, D1 and D2.  Item C was the costs of communications (attendance on the client and the other side, as well as on counsel), and Items D1 and D2 were in relation to preparation of and perusal of documents.

11.  The complaint was pitched in terms that the costs of HK$600,000 allowed “chiefly reflect the costs of production of two affirmations [of the Defendant]”, which were “two rather simple documents” (§17 of the Plaintiff’s Skeleton).  I am afraid I cannot agree with this line of argument for a number of reasons.

12.  In this regard, the approach which I took was to consider each item as presented by both sides, and then come to a determination on what I considered to be a reasonable sum. This too should be apparent from the Costs Decision.

13.  I disagree with the Plaintiff that the items complained of (viz. C and D1 and D2) were chiefly or even primarily in relation to the two affirmations of the Defendant.  Particularly where Item C is concerned, this involved the conduct of the whole litigation, which was commenced in November 2019, and only heard in November 2021, a period of two years.  Over that period, there would have been instructions taken, legal advice given, liaison required with counsel, various communications between solicitors, and the like.  The work involved goes well beyond simply producing two affirmations in answer to the claim.

14.  Furthermore, the costs in relation to Items D1 and D2 must be seen in context of the very modest sum of costs charged by counsel on drafting (Item E1 – HK$10,000).  Again, as I have already stated in the Costs Decision, this meant that the bulk of the work fell on the solicitors’ shoulders.  I would add that if counsel of 11 years’ call had been responsible for such drafting, I would anticipate that the costs could well be commensurate if not higher.

15.  Finally, I note that I had already substantially reduced the costs in relation to Item D (from a total of HK$857,653 to HK$378,000). Insofar as Items D1 and D2 were concerned, the level of reduction was from HK$665,253 to HK$300,000 (i.e. over 50%).  This took into account the unsatisfactory presentation of the claimed sum, which did not provide a breakdown on who had performed which tasks.

16.  In addition to the above, various other points were made by the Plaintiff, including the following, which I briefly address (§3 of the Summons):

(1)  It is said I failed to take into account sufficiently or at all the nature and simplicity of the substantive dispute.  I had in fact weighed this in the process (as illustrated by §9(2) of the Costs Decision).

(2)  Reference was also made to the fees charged by the solicitors in comparison to that charged by counsel.  As I have already noted, the fees charged by counsel were very modest considering his level of seniority.  If the argument is that the solicitors ought to have been charging in a manner equally as economical, then I cannot accept such argument.  Simply because solicitors are able to secure counsel at an economical rate, does not mean that they are not entitled to charge a reasonable sum for their own work, and that they must match this rate by being equally “modest” themselves.  Indeed, it is reasonable to expect that they will need to bear more of the work and spend more time liaising with counsel to get counsel up to speed, which is what I had assumed had occurred in the present case. (Reference may also be made to Sinocare Group Limited v Doron Biran & Ors [2012] HKCFI 125 at §5).

(3)  Reference was further made to the lack of utility and relevance of the majority of the exhibits filed by the Defendant to the dispute at hand.  These included medical receipts and a collection of photos of the Defendant with the Deceased. Even if they were not specifically cross examined upon at trial, I would disagree that these were entirely irrelevant.  One of the Plaintiff’s key allegations was that she had a good relationship with the Deceased whereas the Defendant did not.  A considerable amount of evidence concerned, for instance, who had been responsible for taking the Deceased to his medical appointments and taking care of his daily needs (an issue raised by the Plaintiff).  This formed the background against which the issues in dispute were considered (viz. the Deceased’s underlying intention in the transfer of the Tai Tam Road Property, a property of considerable worth).

17.  In the circumstances, I decline the Plaintiff’s application for leave to appeal.  Costs of this application will be borne by the Plaintiff, to be taxed if not agreed.

18.  Finally, as mentioned at paragraph 2 above, the Plaintiff is to bear the costs of the hearing on 6 September 2022. The hearing itself was fixed for 30 minutes.  For this purpose, the Defendant’s solicitors had prepared a set of skeleton submissions (in answer to the Summons, without the benefit of having seen the Plaintiff’s counsel’s skeleton).  Much of the preparation would have been helpful and used in the submissions eventually filed for the paper determination, which were submitted by the firm itself and not counsel.  Taking these matters into account, the costs of the hearing on 6 September 2022 which the Plaintiff is to pay to the Defendant are assessed on a gross sum basis at HK$15,000.

19.  I thank counsel Mr Wing So and Ms Jasmine Chau of the Defendant’s solicitors for their assistance.

HCMP 2211/2019

[2022] HKCFI 1933

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 2211 OF 2019

________________________

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REASONS FOR

DECISION ON COSTS

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INTRODUCTION

1.  On 13 April 2022, I handed down the decision in relation to the Originating Summons dated 29 November 2019 (“OS”) issued by the Plaintiff Ms Chan Oi Kwan (“the Plaintiff”), wherein she sought various reliefs in relation to the administration of the estate of Mr Chan Yuen (“the Deceased” / “Father”) (“OS Decision”). In the OS Decision, I found in favour of the Defendant. These reasons are to be read together with the OS Decision.

2.  At the end of the OS Decision, I made a costs order nisi that the Plaintiff was to pay the costs of the proceedings to the Defendant (including any costs reserved), and gave directions for assessment of the costs of the OS by way of gross sum assessment in writing.

3.  Pursuant to those directions, the Defendant lodged and served his statement of costs on 3 May 2022, and the Plaintiff’s solicitors (Messrs. Paul W. Tse, newly appointed since the trial) wrote to the Court by way of letter dated 23 May 2022 commenting on the various items of costs.

4.  Having considered the above, I ordered on 26 May 2022 that costs would be assessed at HK$800,000.

5.  By letter dated 7 June 2022, the Plaintiff’s solicitors have requested a breakdown of and reasons for the costs assessment, which I now set out below.

THE DEFENDANT’S STATEMENT OF COSTS & THE PLAINTIFF’S OBJECTIONS

6.  The total sum claimed in the Defendant’s Statement of Costs was HK$1,351,649. This comprised the following:

B Manual Work

B1	Photocopy charges:	3260 pages	$3,260
B2	Attendances by litigation clerk:	57 times	$6,270
		Sub-total:	$9,530

C Communications including Conferences, Telephones Calls and Letters

C1	Attendance on client:	JC*: 32 hours 25 mins; LC*: 3 hours	$172,467
C2	Attendance on other side:	JC: 23 hours 53 mins; LC: 12 hours 17 mins	$140,162
C3	Attendance on counsel:	JC: 10 hours 18 mins; LC: 30 mins	$54,210
		Sub-total:	$366,839

D Professional Work

D1	Preparation of Documents:	88 hours 20 mins	$459,333
D2	Perusal of Documents:	39 hours 36 mins	$205,920
D3	Preparation for hearing:	18 hours 30 mins	$96,200
D4	Hearing including call-over:	18 hours 30 mins	$96,200
		Sub-total:	$857,653

E Counsel – (11 yesrs of experience)

E1	Drafting		$10,000
E2	Conference		$17,000
E3	Brief		$60,000
D4	Refresher		$30,000
		Sub-total:	$117,000

F Other Disbursements

	Travelling expenses		$627
		Sub-total:	$627

*In relation to the above items, JC was the handling solicitor of 15 years’ call, and LC was the litigation clerk.

7.  The Plaintiff took issue with the following items, the reasons being briefly summarized below:

(1)  Items B1 and B2: the main objections being (a) the limited number of letters and documents that had been filed or exchanged and (b) the fact that the substantive hearing bundle was compiled by the Plaintiff’s former solicitors. The Plaintiff proposed to reduce these to HK$1,000 and HK$750 respectively.

(2)  Items C1, C2 and C3: the main reasons being that the figures were excessive as the case was not complex in terms of papers and issues involved, and the handling solicitors (who remained the same throughout) should not have required such extensive hours in performing these items. Comment was also made on duplication of work. The Plaintiff proposed to reduce these to HK$35,100, HK$23,400 and HK$31,850 respectively.

(3)  Items D1 and D2: the main reason being that the figures were excessive in view of the limited volume of papers. The comment was also made that preparation of documents could have been handled by the litigation clerk. The Plaintiff proposed to reduce these to HK$5,200 and HK$33,800 respectively.

(4)  Item D3: the reason being that it overlapped with Item C3. The Plaintiff proposed to reduce this to HK$0.

(5)  Item D4: the reason being that the amount of time for the hearing was excessive, which ought to have been 11 hours. The Plaintiff proposed to reduce this to HK$57,200.

(6)  Items E1 to E4: it is said that the brief (E3) should have included drafting (E1), conference (E2) and refresher (E4), so only E3 should be allowed.

(7)  Item F: Travelling expenses should be disallowed.

8.  On tallying the Plaintiff’s figures, this would have meant the costs of the total action would be HK$248,300.

REASONS

9.  I have considered the individual objections above and also more broadbrush views on the overall costs as well in coming to the HK$800,000 figure ultimately assessed. In particular, I would note the following points:

(1)  I accepted part of the objections as to Items B1 and B2. However, I would note that there were also considerable submissions (Opening, Closing, and Replies to Closing, along with various authorities) which were filed by both sides which would have necessitated some photocopying and handling as well. I assessed these items at a total of HK$5,000.

(2)  I considered the level of reduction proposed by the Plaintiff in relation to Items C1, C2 and C3 was disproportionate. Whilst the case itself was not overly complex, the evidence covered matters which occurred over a considerable period of time. The nature of the allegations and counter allegations meant that time would need to be spent explaining the legal principles, and then taking instructions on the client’s stance, the information required, and the like. Bearing in mind I cannot possibly assess each item of attendance, I took a global approach and assessed these costs in Item C at a total of HK$300,000.

(3)  I accepted part of the objections as to Items D1 and D2. I noted that there was no breakdown provided on who performed these tasks, and the time spent on preparation and perusal of documents was considerable. However, I assumed that this included drafting of the evidence (given the minimal drafting charges by counsel). The evidence of the Defendant was all in Chinese, and as helpfully noted by the Plaintiff, this comprised the 1^st Affirmation of the Defendant (14 pages with 54 pages of exhibits) and the 2^nd Affirmation of the Defendant (11 pages with 11 pages of exhibit). In my experience, a Chinese language affirmation tends to contain a greater amount of information within a shorter page count, so one cannot simply point to the page count to say that it ought not to have required so much time to prepare and collate. Having again reviewed the Defendant’s evidence for the purposes of the decision, I tended to the view that Items D1 and D2 should still have required a decent amount of time, albeit not at the level sought. Adopting a global approach as to perusal and preparation, I assessed these costs of Items D1 and D2 at a total of HK$300,000.

(4)  As to Item D3, I accepted that preparation for the hearing ought not to have taken that long. I assessed this at HK$10,000

(5)  As to Item D4, the substantive hearing took place over 3 days, although some of these were not full days. The figure was also intended to cover the call-over hearing. I assessed this at HK$68,000.

(6)  As to Items E1 to E4, I allowed Counsel’s fees of HK$117,000 in full. Mr Cheung is a counsel of 11 years’ call. I consider the fee that he charged for this matter to be more than reasonable.

(7)  On Item F, I disallowed the travelling fees.

10.  The above figures tally to HK$800,000. One must bear in mind that these costs covered the entirety of the action from inception to trial. In bringing the matter to trial, I consider that the fees as assessed were on the whole reasonable.

Written submissions of Messrs. Paul W. Tse, for the Plaintiff

Written submissions of Messrs. Chau & Co, Solicitors, for the Defendant

HCMP 2211/2019

[2022] HKCFI 941

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 2211 OF 2019

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DECISION

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INTRODUCTION

1.  This was the substantive hearing of the Originating Summons dated 29 November 2019 (“OS”)  issued by the Plaintiff Ms Chan Oi Kwan (“the Plaintiff”), wherein she sought various reliefs in relation to the administration of the estate of Mr Chan Yuen (“the Deceased” / “Father”).

2.  The Court heard oral evidence from the Plaintiff and the Defendant during the trial. No other witnesses were called.

3.  At trial, the Plaintiff was represented by Counsel Mr Colin Leung and the Defendant Mr Chan Fu Wing (“the Defendant”)  was represented by Counsel Mr Justin Cheung.

BACKGROUND

4.  The Deceased passed away on 13 July 2015. The Plaintiff and the Defendant are his only issue, and the only two beneficiaries of his estate. The Plaintiff is the younger sister of the Defendant.

5.  The Deceased died intestate at the age of 86. Letters of administration were granted to the Defendant on 6 October 2015.

6.  The core of the dispute between the parties concerns two properties which were owned by the Father during his lifetime:

(1)  Workshop M on 22/F of Block 1, Kingswin Industrial Building Nos. 32-50 Lei Muk Road, Kwai Chung, New Territories (“the Industrial Property”). The Industrial Property was acquired by the Father in 2004 and owned by him up to the point of his passing. It is currently registered in the name of the Defendant as administrator for the Father; and

(2)  Flat 4 on 5^th Floor of Block B, Shan Shui Court, No. 200 Tai Tam Road, Hong Kong (“Tai Tam Road Property”). The Tai Tam Road Property was acquired in 1978 and held under joint tenancy by the Father and his wife Ms Lee Shui Fun (“Mother”). When the Mother passed away in May 2009, the Father became the sole owner thereof. On 22 April 2010, the Tai Tam Road Property was assigned to the Defendant and the Defendant’s wife as joint tenants. On its face, the transfer was done by way of a sale and purchase agreement, the consideration specified in the documents being $1,350,000. There is no dispute that this sum was not actually transferred to the Father.

7.  The Plaintiff and the Deceased both confirmed at trial that the relations between them were strained, and had been so for many years.

RELEVANT LEGAL PRINCIPLES

Advancement and Hotchpot of the Estate

8.  In a case where the intestate leaves only surviving issues but no surviving spouse, the distribution of the intestate’s estate is governed by s.4(5)  of the Intestates’ Estates Ordinance (Cap. 73)  (“IEO”), which provides that the residuary estate of the intestate is to be held on the statutory trusts for the issues of the intestate who, by virtue of s.5(1)(a), will take in equal shares.

9.  S.5(1)(c)  of the IEO provides that a child of the intestate is under a duty to account for and bring into hotchpot any advancement or gift upon marriage made in his favour during the lifetime of the intestate, subject to any contrary intention expressed:-

“(c)  where the property held on the statutory trusts for the issue is divisible into shares, then any money or property which, by way of advancement or on the marriage of a child of the intestate, has been paid to such child by the intestate or settled by the intestate for the benefit of such child (including any life or lesser interest and including property covenanted to be paid or settled)  shall, subject to any contrary intention expressed or appearing from the circumstances of the case, be taken as being so paid or settled in or towards satisfaction of the share of such child or the share which each child would have taken if living at the death of the intestate, and shall be brought into account, at a valuation (the value to be reckoned as at the death of the intestate), in accordance with the requirements of the personal representatives”. (emphasis added)

10.  The rationale for this rule is to achieve equality amongst the children of the intestate, based on the presumed intentions of a parent in favour of such equality. However, since a parent might clearly wish to prefer one or more of their children over the others, this statutory rule is subject always to any contrary intention expressed: Annotated Ordinance of Hong Kong: Intestates’ Estates Ordinance (Cap. 73) at §5.16. In this regard, the operation of s.5(1)(c)  of the IEO is analogous to the equitable presumption against double portions, under which a donor is rebuttably presumed not to have intended to give two portions to the same donee absent contrary indication: Re Cameron (deceased) [1999] 2 All ER 924 at §59 per Lindsay J.

11.  Two elements have to be made out before a child of the intestate would be required to account for an advancement under s.5(1)(c)  of the IEO.

12.  First, the plaintiff who alleges advancement bears the burden of proving an “advancement” within the meaning of s.5(1)(c):-

(1)  An “advancement” cannot be a mere casual payment. That said, it is not narrowly confined to gifts establishing a young person in life, or in the case of an older person, as meeting some particular need such as expansion of his business or money required to buy out the share of a deceased or outgoing partner. Instead, an “advancement” includes “anything which may fairly be described as a permanent provision” for the intestate’s child: Hardy v Shaw [1976] 1 Ch 82 at 87-88 per Goff J (as he then was), commenting on s.47(1)(iii)  of the Administration of Estates Act 1925 (“AEA”)[1].

(2)  The fact that the subject matter being transferred is substantial in value, both when looked at absolutely and relatively with regard to the intestate’s whole estate, is a factor which points in favour of the subject matter being an “advancement” absent any other evidence of intention: Hardy v Shaw (supra)  at 88-89; cf. In re Hayward [1957] Ch 528.

(3)  In the context of the equitable presumption against double portions, the Court, in deciding whether a gift is a “portion” of the estate, would likewise consider the donor’s intention, the size of the gift, as well as the purpose for which and the circumstances under which the gift is given: Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (21^st Edn)  at §§66-22 – 66-23; cf. Re Cameron (deceased) [1999] 2 All ER 924.

13.  Second, once this has been proved, the onus then falls upon the defendant to prove that the deceased had a contrary intention:-

(1)  The test in this regard is not objective – that is, if the intestate had thought of everything, what his or her intention would likely have been. Instead, the test is subjective, that is: looking at all the circumstances, do they require an inference that the intestate’s intention was that the gift should not be brought into hotchpot? This requires the Court to decide whether the facts as a whole indicate an intention on the intestate’s part not simply to anticipate the provision the defendant would get on the intestate’s death, but “an intention and desire to prefer [the defendant] to the plaintiff not only in point of time but in point of the amount and nature of that provision”: Hardy v Shaw (supra)  at 89.

(2)  Unless the defendant discharges his onus of proving such contrary intention, the statutory hotchpot under s.5(1)(c)  is mandatory: Hardy v Shaw (supra)  at 87.

Revocation of Grant of Letters of Administration  

14.  An application for removal of an administrator can be brought under s.33(3)  of the Probate and Administration Ordinance (Cap. 10)  (“PAO”), which provides:-

“(3)  The court may, if satisfied that the due and proper administration of the estate and the interests of the persons beneficially entitled thereto so require, suspend or remove an executor or administrator (other than the Official Administrator)  and provide for the succession of another person in place of such executor or administrator and for the vesting in that other person of any property belonging to the estate.” (emphasis added)

15.  Insofar as the removal of an administrator is concerned:-

(1)  It is well-established that the Court has a wide discretion to remove an administrator under s.33(3)  of the PAO. The exercise of the discretion is not necessarily premised on a finding of misconduct on the part of the administrator. Whilst there are cases referring to the relevance of the choice of a testator and that the Court should be cautious and sparing in the exercise of its power of removal, it is ultimately an assessment by the Court, having regard to all the relevant circumstances of the case, if removal is required for the “due and proper administration of the estate and the interests of the persons beneficially entitled thereto”. Each case must be decided on its own facts: Re Estate of Chan Chung Han [2019] 1 HKLRD 1300 at §§26-27 per Lam VP (as he then was).

(2)  In Re Estate of Loo Che Chin [2013] 2 HKLRD 738, Poon J (as he then was)  made the following pertinent observations (at §13):-

“Now, it is well-established that friction or hostility between an executor and a beneficiary alone, without more, is of itself not a good reason for removing the executor.… However, if the hostility is grounded on the mode of administration, then it is a factor that cannot be ignored…. This is a relevant factor because the expeditious and economical administration of the estate is always one of the objects that the Court keeps in mind…. Thus, if by reason of the hostility, the executor is rendered unfit to perform his duties as executor, he may be removed…. Such inability to perform his duties as executor may be proved if it can be demonstrated that he would, say, by reason of the hostility, (a)  administer the estate in a manner not in accordance with the law…; or (b)  obstruct the due administration of the estate…. The Court may also pass over the executor if the breakdown of relations has caused or has the potential to cause difficulty in the administration of the estate….” (emphasis added)

(3)  Likewise, if the administration has come to a standstill because relations between the representatives and the beneficiaries have broken down, or if for whatever reason (such as clash of personalities, or the lack of confidence in the personal representative by the beneficiaries, even if unjustified)  it has become impossible or difficult for the administration to be completed by an existing personal representative, then an order for his removal will usually be made. A breakdown in relations between the executor and beneficiary is another factor for the Court to take into account if it is obstructing the administration or the estate, or even sometimes if it is capable of doing so: Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (supra)  at §57-20.

16.  As to the choice of substitute administrators:-

(1)  The Court has an unfettered discretion under s.33(3)  as regards the choice of substituted administrators: Re Estate of Lau Yik Lam (supra)  at §10 per Johnson Lam J (as he then was). 

(2)  In some cases, the Court may consider it appropriate to remove all the current executors or administrators and to replace them with an independent and suitably qualified professional (such as a solicitor)  (see, e.g., Re Estate of Anthony Steel [2010] EWHC 154 (Ch)  at §§106-125). 

(3)  In other cases, the plaintiffs may be appointed as the executors or administrators to complete the administration of the unadministered estate of the deceased in place of the defendant where the defendant was guilty of misconduct, such as the misappropriation of property belonging to the estate for his own benefit (see, e.g., Re Estate of Gee Wong Chou Kok[2018] HKCFI 1597).

(4)  There are also cases where the Court would appoint persons other than the existing beneficiaries to be the substituted administrators where the beneficiaries themselves find such an arrangement more conducive to the proper administration of the estate, provided that the Court is satisfied as to the fitness of these persons (see Lau Yik Lam (supra)  at §10).

ISSUES AND PARTIES’ RESPECTIVE CASES

17.  The parties are at odds over the intention underlying the transfer of the Tai Tam Road Property in 2010 and the impact that has on the administration of the estate.

18.  The Plaintiff contends that:

(1)  The transfer of the Tai Tam Road Property from the Father constituted an advancement within the meaning of Section 5(1)(c)  of the IEO;

(2)  The Defendant cannot establish that the Father had a contrary intention not to include the Tai Tam Road Property in the hotchpot; and

(3)  The Industrial Property should be transferred to her.

19.  Further, she says that the Defendant should be removed as administrator and she should be appointed as administratrix of the estate.

20.  In support of her case she refers to various factual matters in her affirmations in support of the OS, which she expanded upon in her oral evidence. To summarise, she says that:

(1)  Her relationship with her Father was good. She often took care of him and had dinner with him. Whereas she says the Defendant rarely cared for the Father.

(2)  In or about 2008, the Father began to have dementia or Alzheimer’s disease.

(3)  When the Mother passed away in 2009, the Father was depressed and suffered insomnia. He was not in a good state of mind and required taking care of. She arranged for him to attend a centre for elderly people to provide daily meals and activities.

(4)  In July of the same year, she took her Father to a family trip in Korea. He left the hotel on his own without telling anyone and when he came back to the hotel he seemed confused.

(5)  In April 2010, when the Father assigned the Tai Tam Road Property to the Defendant and his wife, the Father was not in a fit state of mind to do so. She also said at various junctures that the Defendant had taken advantage of the Father’s low mood and encouraged him to transfer the Tai Tam Road Property to him and his wife.

(6)  In June 2013, during a chat with the Father, the Plaintiff learned for the first time that the Father had transferred the Tai Tam Road Property to the Defendant. The Father told the Plaintiff (in the absence of the Defendant)  that since the Tai Tam Road Property had been given to the Defendant, the Industrial Property should be given to the Plaintiff. She further says that the Father complained in that same conversation that after the Mother passed away the Defendant had taken away some of the Mother’s personal belongings such as jewelry.

(7)  After the Father passed away, the Defendant applied for grant of the estate without notifying the Plaintiff, and the same was granted on 6 October 2015. In so doing, she says that he failed to ascertain whether there was any will left by the Father.

(8)  On 7 January 2016, the Plaintiff instructed a solicitors’ firm to request for documents relating to the administration. Some such documents were sent on 2 February 2016.

(9)  On 19 February 2016, the Industrial Property was transferred into the name of the Defendant as administrator (where it remains so registered up to the present date).

(10)   The administration of the estate remains stalled to date; according to the Plaintiff it is because of the Defendant’s failures to properly deal with the probate matters in a timely and reasonable fashion.

21.  The Defendant disputes the Plaintiff’s contentions and says that:

(1)  The Tai Tam Road Property was intended to be an “ancestral home” (“祖屋”)  that should be passed from generation to generation in the male lineage. It was with this understanding that the transfer took place to him and his wife in 2010. The Defendant’s case is thus that the transfer of the property was not an advancement; and even if so, there was contrary intention expressed by the Father to the effect that it should not be included in the hotchpot.

(2)  There is no need to replace the administrator. In essence, he says that the Plaintiff had been unreasonable in refusing to deal with him after their Father’s passing.

22.  In support of his case he refers to various factual matters in his affirmations in opposition, which he expanded upon in oral evidence. To summarise, he says that:

(1)  He had a good relationship with his Father. He had worked with his Father in the renovation business all along, and his Father had been his mentor. He had assisted in taking care of his Father in his later years and ate dinner with him often.

(2)  The Father’s mental state in 2008 and thereafter, and in particular in 2010, was good; this was generally the case up to around 2014.

(3)  When the Father transferred the Tai Tam Road Property to the Defendant and his wife, he was aware of and in a right state of mind to understand what he was doing.

(4)  By the time the Tai Tam Road Property was transferred to him, the Defendant was already in his mid-fifties and living in a flat owned by himself with the mortgage fully paid off. He did not need financial support from his Father.

(5)  After the transfer, he and his family continued to reside in their own flat, while his Father continued to live in the Tai Tam Road Property until his passing.

(6)  He had never heard from his Father about any intention to give the Industrial Property to the Plaintiff; rather, it was his Father’s intention that it should be shared equally between himself and the Plaintiff.

(7)  He denies having taken any of the Mother’s personal belongings away after her passing.

(8)  He referred to the contemporaneous correspondence after his Father’s passing to show that he had been reasonable in endeavouring to liaise with the Plaintiff, but it was she who had not been cooperative or willing to communicate.

ANALYSIS

Approach to assessing the evidence

23.  In assessing the credibility and reliability of the evidence given by the parties:

(1)  I have had regard to the inherent probabilities of their respective cases, and the internal consistency of their evidence and their demeanor when testifying at trial. I have also had regard to the contemporaneous documents, circumstantial evidence tending to support one account rather than the other, and the overall impression of the character / motivation of the witnesses (Re B (Children)  [2009] 1 AC 1).

(2)  I have borne in mind not only the witnesses’ demeanor in court, but also the history of events, and the contemporaneous documents and the inherent probabilities of the witnesses’ accounts (Esquire (Electronics)  Ltd v The Hong Kong and Shanghai Banking Corp Ltd [2007] 3 HKLRD 439 at 494C).

24.  In relation to the various assertions regarding the Father’s mental state, the Plaintiff has referred to her own recollection as well as some medical reports, both contemporaneous and also prepared on her instructions (in the absence of leave for expert evidence). Mr Leung invites me to consider this as hearsay evidence. I will give my views on the relevance and weight in the particular circumstances of this case in the discussion below.

Questions raised

25.  Bearing the above principles in mind, I address each of the following questions in turn:

(1)  Did the transfer of the Tai Tam Road Property from the Father constitute an advancement within the meaning of Section 5(1)(c)  of the IEO?

(2)  If so, was there any contrary intention that the Father did not intend to include the Tai Tam Road Property in the hotchpot?

(3)  Should the Defendant be removed as administrator and replaced by the Plaintiff as administratrix?

Did the transfer of the Tai Tam Road Property from the Father constitute an advancement within the meaning of Section 5(1)(c)  of the IEO?

26.  The parties are agreed that the burden rests on the Plaintiff to demonstrate that the transfer of the Tai Tam Road Property was an advancement.

27.  Mr Leung invites the Court to consider, in particular, the following features in arguing that the transfer constituted an advancement:

(1)  He says that even on the Defendant’s case, the transfer of the “ancestral home” from generation to generation in the male lineage is a form of “permanent provision” in the vein of Hardy v Shaw (supra). This, he says, is sufficient in and of itself to establish an advancement.

(2)  He refers to the fact that the Tai Tam Road Property was the most valuable or substantial asset of the Father when transferred to the Defendant and thus says that this factor should be determinative in demonstrating permanent provision (citing Hardy v Shaw (supra)  at 89B).

(3)  He refers to the Plaintiff’s evidence that in June 2013, the Father had told her that the Tai Tam Road Property had already been given to the Defendant and that the Industrial Property should be transferred to her. In so doing, he asks the Court to infer that the Father intended there to be permanent provision for both children along such lines.

28.  I will consider each of the above arguments in the context of the findings below.

29.  First, putting aside the parties’ conflicting accounts of what the Father’s intentions were for the moment, if one considers the objective circumstances:

(1)  By the time of the transfer of the Tai Tam Road Property, the Defendant had been working for a good number of years, was already married, and had had children. He had acquired his own property and was living there with his family mortgage free.

(2)  The Father continued to live in the Tai Tam Road Property after the transfer, until he passed, meaning that the Defendant did not gain any immediate benefit from the transfer.

(3)  There can thus be no suggestion that the transfer of the Tai Tam Road Property was to “start him out in life” or to otherwise establish him or benefit him in his career at the material time.

(4)  The question is whether it was nonetheless a form of permanent provision. This question must be considered against the above context.

30.  Second, and on the other hand, the value of the Tai Tam Road Property was undoubtedly substantial. Drawing the strands of the available evidence together:

(1)  The Schedule to the Grant of Probate to the Defendant dated 22 September 2015 set out the assets of the Deceased as at the date of his passing; these comprised: (i)  two bank accounts with remaining balances of over $51,000 odd in total; (ii)  some shares in HSBC and Hang Seng Bank and (iii)  the Industrial Property.

(2)  A set of valuation reports obtained by the Plaintiff in November 2010 valued the Tai Tam Road Property at HK$3.78 million as at 13 July 2015; whereas the Industrial Property was valued at HK$1.68 million as at the same date. There are some limitations to these items of evidence that I would take note of. First, there was no leave to adduce expert evidence as to the values of the properties; second, these have been prepared on the Plaintiff’s instructions with no input from the Defendant. Nevertheless, they are the best available evidence in the circumstances.

(3)  Even bearing the above limitations in mind, it should be relatively uncontroversial that relative to the overall value of the assets accumulated during the lifetime of the Deceased, there is little doubt that the Tai Tam Road Property was certainly a valuable (if not the most valuable)  asset.

31.  Notably, however, the mere size of the asset or gift cannot, of itself, be equated with “permanent provision”. Otherwise, that would negate the discussion in Hardy v Shaw (supra)  as to what this actually entails. The size of the gift, whether in absolute terms or relative to the residuary estate of the deceased, is a factor which the Court weighs alongside other factors (such as the purpose of the gift, the circumstances under which it was given, and the donor’s intention – this list being non-exhaustive). If the gift is larger in value, this will weigh more heavily in favour of it being a permanent provision. If it is trifling in value, then it will likely not be sufficient (see paragraph 12(2)  above). Each case must turn on its own particular circumstances and facts.

32.  The third aspect to be considered is the Father’s intentions. In this regard, the parties’ evidence was conflicting. To summarise:

(1)  The Plaintiff says that the Father had told her in June 2013 that he intended to give her the Industrial Property since he had already given the Defendant the Tai Tam Road Property. Based on this, Mr Leung asks the Court to infer that the respective properties were to be permanent provision for each child.

(2)  Whereas the Defendant relies on and reiterates the main plank of his case, namely that the Tai Tam Road Property was to be the “ancestral home” and thus, was intended to be treated separately from the rest of the Father’s assets and estate; he says that the Father had not indicated to him any intention that the Industrial Property was to be given to the Plaintiff, and that instead, the Father intended the remaining assets to be divided equally.

33.  As to the Plaintiff’s contention regarding her June 2013 conversation with the Father and his alleged intentions in relation to the Industrial Property, there is scant evidence aside from her own bare assertion that this is what the Father had said and intended:

(1)  Since the Father had seen fit to transfer the Tai Tam Road Property to the Defendant in 2010, the obvious query is why he did not take any steps to make similar arrangements in relation to the Industrial Property whether in 2010 or in 2013, or at any other time. There is no contemporaneous evidence that either he or the Plaintiff had made inquiries with any solicitors to effect this transaction.

(2)  Nor is there any independently verifiable evidence (whether documentary or from other witnesses)  that the Father had mentioned to anyone else that this was, indeed, his intention. The Plaintiff says that she had told her husband about the June 2013 discussion, but he was not called as a witness to support her case. She also says that her uncle (“Uncle Five”)  was aware of her Father’s intentions but he had already passed away.

(3)  When pressed during cross examination as to the lack of arrangements regarding the Industrial Property during the Father’s lifetime, the Plaintiff said she had not made arrangements for the transfer because the identity card of the Father had been kept by the Defendant and thus, the transfer of the Industrial Property could not be made (since the solicitors would need his identity card for the formalities). This was a new explanation and had not been proffered in any of the affirmations filed.

(4)  On a review of the available evidence, the account of the June 2013 conversation by the Plaintiff remains very much an unsupported assertion.

34.  One also considers whether the Plaintiff’s account of this June 2013 conversation is credible and consistent taking into account the context and chronology:

(1)  The Plaintiff’s case as to the Father’s alleged plans in June 2013 rests on the acceptance that he was lucid enough to recognize in 2013 that he had transferred the Tai Tam Road Property to the Defendant in 2010. This plan regarding the Industrial Property rested on the assumption that he was in a right frame of mind and had not regretted his actions insofar as the transfer of the Tai Tam Road Property. In this regard, the Plaintiff’s evidence as to her Father’s stance did not appear to seriously suggest any such regret.

(2)  The case put forward by the Plaintiff is thus somewhat inconsistent. On the one hand, she maintains her case that her Father was depressed, confused, susceptible to influence and persuasion by the Defendant, or even suffering from dementia / Alzheimer’s in or around the time of the 2010 transfer (it was rather unclear which allegation(s)  was/were maintained or formed the primary case). On the other hand, the Plaintiff alleges that as at June 2013, the Father bore the express intention to divide his assets in this manner – Tai Tam Road Property to the son; Industrial Property to the daughter.

(3)  In further support of her contention that the June 2013 conversation had taken place, the Plaintiff also puts forward her Father’s alleged complaint about the Mother’s jewelry box and how it had been taken by the Defendant. This is a relatively minor point, and there is in fact little evidence either way to back up the allegations. Even if it were true, I do not consider it necessarily lends weight to the overall allegation that the June 2013 conversation about the Industrial Property had taken place. I thus place minimal weight on this aspect.

(4)  Seen in the round, the story as told by the Plaintiff does not add up when compared against other aspects of her own evidence.

35.  In relation to the above point, I find that the Plaintiff has failed to establish her various contention(s)  that the Father was suffering from dementia or Alzheimer’s disease or otherwise had a reduced mental capacity or was not in a fit mental state to make decisions as to the Tai Tam Road Property in 2010:

(1)  If it is the serious contention that he was suffering from dementia or Alzheimer’s, then solely her own observations of his state as a non-medical professional would certainly not suffice.

(2)  Even for the lesser contentions as to the Father’s mental state, it should be uncontroversial that the Plaintiff is not trained to officially diagnose depression or the like.

(3)  Although I accept that as a daughter and someone who would see her Father on the day to day basis, she would be able to observe his general state, including his mood, this is again of itself insufficient to establish the rather serious allegation that any such state (ranging from the serious allegation of dementia to the lesser allegations of low mood, susceptibility to influence, or not in a generally fit mental state)  necessarily affected his decision making capabilities.

(4)  Insofar as the medical reports produced by the Plaintiff are concerned, I again note the limitations on the status of the evidence. No leave for expert evidence was given, and the various reports do not bear the requisite expert declaration to the Court.

(5)  The above also applies to one of the main documents relied upon by the Plaintiff – the Medical Report prepared by Dr Li Derek Seung Yau. He expressly notes that he had prepared it on the request of the Plaintiff, and it was based on written personal statements of the Plaintiff, records form Pamela Youde Nethersole Eastern Hospital and interviews with the Plaintiff. The report is thus partly based on hearsay evidence. In the final part of the report he is unable to give any firm conclusion as to when the dementia began and says that it “… began much earlier than July 2011 as indicated in the case notes. It could begin as early as 2008”. A mere possibility of dementia beginning at that date is plainly insufficient.

(6)  In any event I have perused the underlying medical records, whether contemporaneous or prepared after the fact, in some detail. In sum, I find that they do not indicate such a severely deficient mental state in 2010. Whilst it is tolerably clear that the Father did have some dementia or Alzheimer’s by around 2015, the available evidence for the time period prior to that is not sufficient to satisfy the Court, on the balance of the probabilities, that the Father was not in a fit state to make decisions about the Tai Tam Road Property as at the time of the 2010 transfer.

(7)  In coming to the above conclusion, I have also had regard to various other aspects of evidence referred to by the parties such as the logistics of the tenancy arrangements for the Industrial Property, the Father’s daily activities, and the like (the details of which I shall not elaborate on here). I similarly do not consider that they are demonstrative of any sufficiently serious mental deficits in the period prior to 2015.

36.  In view of the matters above, I do not believe the Plaintiff’s account as to her alleged June 2013 conversation with her Father, and find that it did not occur. I would note here that having heard the oral evidence from the Plaintiff, I do accept her evidence that she had regularly seen and taken care of her Father in his later years. I do not doubt their bond and her care for her Father, but this of itself does not negate the various factors analysed above insofar as the alleged June 2013 conversation is concerned.

37.  Further to the above, one can assess the Defendant’s account of the Father’s intention as to the Tai Tam Road Property being transferred to him as the “ancestral home”, which is the opposing case put forward to counter the Plaintiff’s version of events.

38.  The main evidence put forward by the Defendant is his account of his conversations with the Father (which he says took place in the Plaintiff’s absence). Similar to the Plaintiff, there is little direct evidence explicitly setting out the Father’s intentions; there are no other witnesses called to substantiate the Defendant’s version of events.

39.  However, the Defendant’s account is, seen in context, supported by the surrounding circumstances:

(1)  I find that the Defendant also had a genuine bond with his Father. I accept his evidence that he too had taken care of his Father in various ways, and had regularly seen and had meals with him. The Defendant was the eldest son. He had entered the same line of work as his Father.

(2)  In such circumstances, it would not be surprising that an elderly man with a traditional mindset would wish to pass on the family home to his son, with whom he had a good relationship, and in this way prefer him over his daughter (even if he also had a good relationship with her).

(3)  There is no dispute that although the transfer was framed as a sale and purchase, no consideration in fact changed hands. The very fact that the transfer had taken place in circumstances when no steps were taken to deal with the Industrial Property is of itself significant.

(4)  As to the manner of the transfer, the Defendant’s explanation was that this was done by way of sale and purchase (rather than as a gift)  on the advice of the solicitors, in order to avoid unnecessary complexities in potential future transactions.

(5)  Related to the above, although much was made in cross examination of the original wording in the Defendant’s evidence – the suggestion being that he wished to conceal the nature of the “gift” – I do not give much credence to this since it is tolerably clear from the totality of the evidence that this fact of no money changing hands had been apparent to the parties relatively early on in the proceedings. The line of questioning unduly focused on the perceived distinction between “轉易” in the first affidavit and “轉贈” in the second affidavit, when there was not necessarily anything ‘hidden’ by the use of the term “轉易” in the first place (referring to a transfer, whether with or without consideration).

(6)  There was, similarly, much focus placed in cross examination on the fact that the transfer was to the Defendant and his wife and not to the Defendant alone. However, this arrangement is not dissimilar to how the Father and his wife had previously held the property. There is no particular oddity about it being transferred to the Defendant and his wife, and I do not consider that in the circumstances of the present case, this negates the understanding of “ancestral home”. In this regard, I consider that the understanding of “ancestral home” was that of a layman, and one ought not approach the evidence on the Father’s intention and state of mind with unduly technical understandings of the law surrounding the holding of property.

40.  On the whole, I found the Defendant to be a credible witness insofar as his account of his conversations with his Father was concerned. Taken together with the surrounding circumstances, I find that he was telling the truth as to: (1)  his Father’s intentions for the “ancestral home”, and also (2)  that there was no indication from his Father to him that the Industrial Property was to be given to the Defendant.

41.  The Plaintiff complains that this version of events regarding the “ancestral home” was only disclosed upon commencement of these proceedings. I do not consider that the later disclosure renders it unbelievable in the present circumstances:

(1)  The Plaintiff herself acknowledges she had no contemporaneous knowledge of the Father’s intentions as to the Tai Tam Road Property. She only learned of the transfer after the fact. Her evidence in this regard is thus of limited assistance, save that she points to the lateness of the story coming out.

(2)  The lack of communication is readily explained by the strained relationship between the Plaintiff and the Defendant. There would have been no particular motivation on the part of the Defendant to tell the Plaintiff what had occurred. As to what the Father did or did not choose to disclose, there is little evidence to show that he would discuss the affairs relating to the properties with the Plaintiff – she was unaware, for example, how he dealt with the tenancy arrangements for the Industrial Property, whereas the Defendant’s evidence is that in the later years, he had assisted his Father with some logistics in relation to this.

42.  Applying the principles summarized above and having considered the factors analysed above in the round, I consider that the transfer of the Tai Tam Road Property was not an advancement:

(1)  Whilst the value of the property was undoubtedly substantial, whether on its own or relative to the rest of the Father’s assets, this at best sets up the proposition that there may be a prima facie case of advancement or permanent provision.

(2)  However, in the circumstances of the present case, the Defendant did not gain the “benefit” during the Father’s lifetime since he did not use the property. He also had no need for the property since he was relatively established in life.

(3)  Insofar as his “benefit” upon his Father’s passing, this must be seen in light of the Father’s wish for the home to be passed from generation to generation in the male lineage.

(4)  I also note that if one is viewing the analysis through the lens of presumed fairness or equality of provision for both children, then the fact that the Tai Tam Road Property was of substantially greater value than the Industrial Property would further weaken the Plaintiff’s argument. The disproportionately larger value tends to suggest (and I put it no higher than that)  that the transfer of the Tai Tam Road Property was not an advancement but for some other purpose, viz. the desire to pass the “ancestral home” to the elder son. (cf. Re Lacon [1891] 2 Ch 482 at 500, 504).

If so, was there any contrary intention that the Father did not intend to include the Tai Tam Road Property in the hotchpot?

43.  If I am wrong on the above, and the transfer of the Tai Tam Road Property is to be considered an advancement, I would have considered that there is a contrary intention that the Father did not intend to include the Tai Tam Road Property in the hotchpot.

44.  For this, I would bear in mind that the focus is on the Father’s subjective intentions and that it is incumbent upon the Defendant to prove as such. The matters I have discussed at paragraphs 32 to 42 above would lead to findings that:

(1)  Even if the transfer of the Tai Tam Road Property was an advancement by the Father, he had expressed a contrary intention that the “ancestral home” was to be treated separately from the rest of the estate;

(2)  There was no expressed intention on the Father’s part that the Industrial Property was to go to the Plaintiff; and

(3)  It may be inferred that the intent was that the remainder of the assets, including the Industrial Property, were to be equally shared.

Should the Defendant be removed as administrator and replaced by the Plaintiff as administratrix?

45.  I note that in the OS, the original relief sought by the Plaintiff was for the letters of administration as granted to the Defendant to be revoked, and the Plaintiff appointed as administratrix of the Deceased’s estate in lieu. This relief is governed by s.33(1)  of the PAO.

46.  The revocation of grant in s.33(1)  of the PAO is wider than the relief under s.33(3)  of the PAO for removal and replacement of the administrator. Whilst the grounds for revocation and removal under the two sub-sections may overlap to some extent, prior authorities have made clear that s.33(3)  instead of s.33(1)  should be used if there is no need to revoke the grant to achieve the plaintiff’s purpose (Re Estate of Kwan Chung [2013] 6 HKC 29 at §§22-26).

47.  The parties’ submissions at trial appear to have been geared towards s.33(3)  rather than s.33(1), as all of the cases cited concerned applications under s.33(3).

48.  In any event, I consider that in the circumstances of this case, there is no need to consider a s.33(1)  revocation since a s.33(3)  removal would be sufficient to achieve the Plaintiff’s purposes. I have thus considered the parties’ submissions and the relevant evidence on this footing and not on the wider s.33(1)  footing.

49.  Having considered the parties’ evidence and submissions on this aspect, I find as follows:

(1)  The Plaintiff never indicated in 2015 that she wished to be the administratrix. She even acknowledged that it was up to the Defendant if he wished to take up the position.

(2)  The complaint on the failure to ascertain whether there was any will is neither here nor there. There was no cogent evidence that there was, in fact, any will made. And indeed, both parties appear to acknowledge that their Father was a traditional man and would generally have been reluctant to discuss such matters let alone actually go through the process of drafting and signing a will.

(3)  As to the period of time it has taken to administer the estate, I do not consider that this was solely attributable to the Defendant. The relationship between the parties is plainly strained. The attempts at communication on both sides was met with less than ideal responses, and there was clearly a degree of acrimony on both sides, leading to both sides having to engage lawyers. However, this acrimony, in and of itself, is insufficient to lead to the replacement of the administrator.

50.  At the conclusion of the closing submissions I had inquired with both sides whether any proposals on alternate candidates could be put forward if, in fact, the Court took the view that the Defendant should be replaced. The Plaintiff has not put forward any alternate candidates.

51.  In any event, it would appear that the chief area of dispute centred on how the administrator was to treat the distribution of the Industrial Property. In light of the findings above, there should be less room for disagreement between the parties going forward.

52.  In the circumstances, I do not consider it is necessary nor would it be conducive to the administration of the estate to replace the Defendant as administrator with the Plaintiff. 

CONCLUSION

53.  The Plaintiff thus fails in her application.

54.  As to costs, I make a costs order nisi that the Plaintiff is to pay the costs of the proceedings (including any costs reserved)  to the Defendant, to be assessed by way of gross sum assessment in writing. The Defendant shall lodge and serve his statement of costs within 21 days of this decision, and the Plaintiff shall provide comments thereon within 21 days thereafter.

55.  I thank both counsel for their assistance.

Mr Colin LEUNG, instructed by Lawrence Y. W. Ng & Co, for the Plaintiff

Mr Justin CHEUNG, instructed by Chau & Co, Solicitors, for the Defendant