LAM WAI LIK ERIC AND OTHERS v. TAM SUET MUI

CACV 10/2021

[2023] HKCA 1353

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 10 OF 2021

(ON APPEAL FROM HCAP NO 5 OF 2015)

__________________

__________________

____________________

J U D G M E N T

____________________

Hon Yuen JA:

Background

1.  On 14 November 2023, this court handed down a Judgment¹ (“the CA Judgment”) dismissing with costs the defendant’s appeal from the judgment of Wilson Chan J (“the judge”) given on 14 December 2020² (“the CFI Judgment”). 

2.1.  In the CFI Judgment, the judge pronounced for the 1987 Will of the deceased in solemn form and dismissed the defendant’s counterclaim in which she sought to propound either one of two later wills (“the 1999 Will” and “the 2005 Will”).

2.2.  The judge rejected the plaintiffs’ contentions that the 1999 Will was not authentic and was not signed by the deceased, but found that he did not have the requisite testamentary capacity.  The judge also found that the deceased had neither testamentary capacity for, nor knowledge or approval of, the 2005 Will. 

2.3.  The judge made a costs order nisi that the defendant pay the plaintiffs’ costs of the action, which both parties then applied to vary. 

3.1.  Shortly before the hearing of the appeal (16 May 2023), on 28 April 2023 the judge handed down his decision making a costs order absolute that the costs of the action do follow the event, varying his costs order nisi only to the extent that the plaintiffs be entitled to certificate for two counsel, with legal aid taxation for a specified period of time (“the CFI Costs Decision”).

3.2.  By a summons filed the day before the hearing of the appeal, the defendant proposed to appeal the CFI Costs Decision by way of a Supplementary Notice of Appeal (“the proposed costs appeal”) in which the defendant sought the following orders:

(a) that the defendant’s costs relating to the issue of forgery of the 1999 Will (including costs occasioned and thrown away by the adjournment of the trial, originally listed to start in September 2018) be borne by the plaintiffs, to be taxed if not agreed;

(b) there be no order as to the plaintiffs’ own costs relating to the issue of forgery of the 1999 Will (other than legal aid taxation);

(c) the defendant’s costs of the action relating to the propounding of the 1999 Will, other than costs relating to the issue of forgery of the 1999 Will, be borne by the deceased’s estate;

(d) the plaintiffs’ costs of the action relating to the opposition of the 1999 Will (except relating to the issue of forgery of the 1999 Will) be borne by the deceased’s estate.

3.3.  At the hearing of the appeal, we decided that as the parties had not filed submissions relating to the summons, we would give directions in the Judgment for the proposed costs appeal. 

3.4.  Accordingly in our Judgment, we gave leave to the parties to file submissions on the proposed costs appeal within 14 days of the date of the Judgment.

3.5.  On 28 November 2023, both parties filed submissions for the proposed costs appeal. 

Discussion

4.  As mentioned above, the judge ordered that the costs of the action should follow the event.  

-  The defendant’s submissions

5.  In (a) and (b) above, the defendant essentially contends³ that the judge should have “hived off” the costs relating to the issue of the authenticity of the 1999 Will⁴ (“the authenticity issue”) and ordered that (a) the plaintiffs should pay her the costs of that issue, and (b) the plaintiffs’ costs of that issue should be disallowed.  (Although the parties have not particularised the costs incurred for that issue, one can reasonably assume that where expert reports and expert evidence on handwriting and ink are adduced at a trial, there would have been a significant increase in the length and the costs of the proceedings)⁵.    

- The plaintiffs’ submissions

6.1.  The plaintiffs however submitted that the following circumstances surrounding the authenticity issue should be taken into account.

6.2.  When the plaintiffs commenced the probate action in 2015, the defendant had in her counterclaim sought to propound only an engrossed copy of the 1999 Will.  The defendant’s case was that the original of the will (attested by a solicitor Mr Kam and an articled clerk Mr Kung, and executed at the office of Woo Kwan Lee & Lo) was taken away by the deceased, and later given to Ringo Ho of Ho & Partners for “safe keeping”, but who then lost it. 

6.3.  Ringo Ho however denied that he had ever received the 1999 Will⁶.  He was served with a subpoena by the defendant’s solicitors to testify at the trial which was fixed for 20 days commencing 2 October 2018. 

6.4.  However on 14 September 2018⁷, Ringo Ho said he found the original will⁸.  On 21 September 2018, the defendant applied to amend her defence and counterclaim to plead that she wished now to propound the original will.

6.5.  The plaintiffs then sought an adjournment of the trial for forensic examination of the original will.  Both sides sought the advice of experts on handwriting and ink, and both sets of experts gave evidence at the trial.  During the adjournment, on 1 November 2018, the defendant filed the affirmation of Mr Kam deposing to his attestation of the 1999 Will.

7.  In the CFI Judgment, the judge found in favour of the defendant on the authenticity issue for reasons set out in §§87 - 123.  In a nutshell, the judge preferred the evidence of the defendant’s expert witnesses, and took into account the testimony of Mr Kam and Mr Kung on their attestation of the 1999 will.

- The relevant rules of court

8.  The relevant rules are contained in Order 62 rules 5, 6 and 7 RHC.  Briefly,

-  r.7 provides for costs to be deducted from, or paid by, a party if they arise from his misconduct or neglect (“where any thing is done or omission is made improperly or unnecessarily”),

-  r.5 provides that the court in exercising its discretion as to costs, “shall, to such extent, if any, as may be appropriate in the circumstances”, take into account the conduct of all the parties (r.5(1)(e)) which includes whether it was reasonable for a party to raise, pursue or contest a particular allegation or issue (r.5(2)(a)), and

-  r.6 (specifically applicable to probate actions) provides that “notwithstanding anything in this Order ..., unless the court is of opinion that there was no reasonable ground for opposing the will”, a party opposing a will should not be ordered to pay costs if he has notified the proponent that he “merely insists upon the will being proved in solemn form of law and only intends to cross-examine the witnesses produced in support of the will”.     

- Principles to be applied in the exercise of discretion

9.1.  The principles applicable to the award of costs between parties in contested probate proceedings were set out by the Court of Final Appeal in Nina Kung v Wang Din Shin (No.2)⁹. Ribeiro PJ held:  

-  the award of costs is in the court’s discretion: §10;

-  the general rule in the exercise of discretion is that where opposition to a will is unsuccessful, costs should follow the event: §11; 

-  however,

(i)   if the litigation was caused by the conduct of the testator, the costs should be paid from the estate; and

(ii)  if circumstances had led reasonably to an investigation of the will’s validity, there should be no order as to costs: §12;

-  having said that, if opposition to the will went beyond putting the proponent to strict proof, and took the form of hostile litigation, the court should revert to the general rule that costs follow the event: §15; examples of “fundamentally hostile” litigation were pleas of forgery, fraud or undue influence: §§16-17, and this applies even if the opponent had a reasonable basis for taking the hostile position adopted: §18.

9.2.  In that judgment, which was given before the promulgation of the Civil Justice Reform and before Order 62 rule 5 was amended¹⁰, the CFA was not called upon to consider whether a court in a probate action should also apply the Elgindata¹¹ issue-based approach where a party opposes a will on a number of grounds, and fails on one (forgery) but succeeds on another (testamentary capacity). 

10.1.  In Chinachem Charitable Foundation Ltd v Chan Chun Chuen and anor¹², a probate action, Lam J (as he then was) was asked to apply an issue-based costs order, alternatively a proportionate costs order, in relation to issues on which the plaintiff was unsuccessful.  In that case, the 1^st defendant was found to have fabricated the will he was seeking to propound, but he argued that as the plaintiff was unsuccessful on (1) undue influence, (2) the testatrix’s testamentary capacity and (3) the testatrix’s testamentary intent, that should be reflected in the costs order.

10.2.  Lam J noted that O.62 r.5 RHC had been amended after the CFA judgment such that a court should address the matters raised in that rule.  He held that insofar as a losing party is seeking costs on a particular issue, he was bound by Nina Kung to hold that by reason of O.62 r7(1), that party has to show that the issue was raised improperly or unnecessarily (§47).

10.3.  In relation to the 3 issues, he held that:

-  in respect of issue (1), it was dealt with shortly and did not add to the costs (§48),

-  in respect of issue (2), he held it was not improper or unnecessary for the plaintiff to raise it, so he did not order the plaintiff to pay the 1^st defendant’s costs of that issue (§50), but ordered its costs of that issue to be paid, not by the 1^st defendant, but out of the estate (§59);

-  in respect of issue (3), he also held it was not improper or unnecessary for the plaintiff to raise it and saw no ground for treating the costs for this issue separately from the costs of the action generally (§62).

11.  With great respect, I take the view that Nina Kung should now be read in the light of the amendment to O.62 r.5.  It is clear from a comparison between r.5 in 2006 and r.5 now, that the court is no longer confined to a consideration under r.7 of whether an issue has been raised “improperly or unnecessarily”. Rules 5(1)(e) and 5(2)(a) now require the court to take into account the conduct of all the parties, including whether it was “reasonable” for a party (eg the plaintiffs in this case) to raise a particular issue (eg the authenticity of the 1999 Will) in all the circumstances of the case (including on the one hand, the re-discovery of the original of the 1999 Will after Ringo Ho’s initial denial of possession, and on the other hand, Mr Kam’s affirmation of 1 November 2018). 

12.1.  In the CFI Costs Decision, the judge referred to the CFA Judgment in Nina Kung but held:

“8. Having considered the submissions of the parties, I am satisfied that there were circumstances which led reasonably for the plaintiffs to require the authenticity of the original of the 1999 Will to be investigated by the court. The plaintiffs had acted and undertaken the litigation reasonably. They were the ultimate winners with regard to the 1999 Will.

9. The long and short of it is that the issue of authenticity only arose less than 2 weeks before the commencement of the original trial as prompted by the “sudden re-discovery of the original of the 1999 Will upon which the question of authenticity is a reasonable and natural question to be answered by the defendant”. (Italics added).

12.2.  Although there was no reference to r.5, the reference to “reasonableness” (as opposed to the r.7 reference to “improper or unnecessary”) indicates that the judge did take r.5 into account. 

13.  A costs order is of course a matter for the judge’s exercise of discretion, and it is well-established that an appellate court would not interfere unless there was an error in law, or misapprehension of material facts, or where the judge had failed to take a relevant matter into account, or where he had taken an irrelevant matter into account, or where the decision was plainly wrong.  The weight given to one factor over other factors is also a matter for the judge.

14.1.  In the present case, the judge emphasized the “sudden re-discovery of the original of the 1999 Will”.  In the defendant’s challenge to this, it was argued that:

-  as early as November 2018, Mr Kam had made an affirmation deposing to his attestation of the 1999 Will, and

-  the initial disappearance of the original will was caused by Ringo Ho, not by her.

14.2.  First, in my view the judge was entitled to place weight on the sudden re-discovery of the original will, as the production of an original will (as opposed to only a copy) is significant in a probate action, as it shows that the deceased had not revoked the will by destroying it.  The fact that Mr Kam deposed to its attestation does not alter the significance of the absence of the original will. 

14.3.  Whilst the initial disappearance of the original will was caused by Ringo Ho, not by the defendant, this was a fact known to the judge as he had accepted his evidence (CFI Judgment, §§119-120). 

14.4.  Therefore, while I may have exercised the discretion differently (had I been required to do so) to order that the plaintiffs’ costs on the authenticity issue be paid, not by the defendant, but by the estate, I do not consider that any of the matters which would entitle an appellate court to overturn the judge’s exercise of discretion is present.

15.  Then, as to (c) and (d), the judge held that the defendant “took a view on the validity of the 1999 Will, acted upon it, and failed to establish her case in litigation” (CFI Costs Decision, §11). 

16.1.  The defendant submitted that she held the “honest belief that the Deceased was fit to make the 1999 Will”.

16.2.  However, the fact remains that she would have been well aware of the extent of the deceased’s mental capacity, for it was she who had supplied the information to Sun Life’s service agent who filled in the Disability Claim form¹³, as corroborated by Dr Lee’s Physician’s Statement¹⁴.

Order

17.  For the reasons set out above, I would dismiss the proposed costs appeal, the costs of which should be regarded as part of the costs of the main appeal as in the normal situation, the main appeal would have included the appeal as to costs. 

Hon Au JA:

18.  I agree with the judgment of Yuen JA.

Hon Chow JA:

19.  I agree with the judgment of Yuen JA.

Appendix 1

5.  Special matters to be taken into account in exercising discretion (O. 62, r. 5)

The Court in exercising its discretion as to costs shall, to such extent, if any, as may be appropriate in the circumstances, take into account—

(a)   any such offer of contribution as is mentioned in Order 16, rule 10, which is brought to its attention in pursuance of a reserved right to do so;

(b)   any payment of money into court and the amount of such payment;

(c)   any written offer made under Order 33, rule 4A(2); and

(d)   any written offer made under Order 22, rule 14, provided that the Court shall not take such an offer into account if, at the time it is made, the party making it could have protected his position as to costs by means of a payment into court under Order 22.

CACV 10/2021, [2023] HKCA 1289

On Appeal From [2020] HKCFI 3047

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 10 OF 2021

(ON APPEAL FROM HCAP NO 5 OF 2015)

__________________

__________________

____________________

J U D G M E N T

____________________

Hon Yuen JA (giving the Judgment of the Court):

Introduction

1.  This is the appeal of the defendant (“Madam Tam”) from the Judgment of Wilson Chan J (“the judge”) given on 14 December 2020 (“the Judgment”)[1] regarding the estate of Lam Chok Wai, deceased (“the Deceased”), who died on 21 November 2005, aged 60.

2.1.  The plaintiffs are the beneficiaries under a will made by the Deceased in 1987 (“the 1987 Will”). It was prepared by solicitors, and the names of a solicitor and an articled clerk appear as witnesses.

2.2.  Madam Tam is the sole beneficiary under two wills made in 1999 and 2005 (“the 1999 Will” and “the 2005 Will” respectively). The circumstances surrounding the execution of these wills (in particular, the 1999 Will) will be discussed below.

3.  The trial lasted 18 days. Two of the major issues were the Deceased’s testamentary capacity to make the 1999 Will and the 2005 Will. During the trial, a number of witnesses gave evidence including 4 doctors, 2 of whom viz. Dr Lee Man Kong (“Dr Lee”) and Dr Yu Yuk Ling (“Dr Yu”) had treated the Deceased during his lifetime. The other 2 doctors were psychiatrists, viz. Dr Chung See Yuen (“Dr Chung”) and Dr Benjamin Lai (“Dr Lai”).

4.  The judge’s orders are set out in §37.1 below. There is no appeal from his finding of the invalidity of the 2005 Will.

The Deceased

5.1.  The Deceased was born in 1945. His father was the founder of Tai Lin Radio Service Ltd, a successful electrical appliances company (“Tai Lin”)[2]. The father acquired a number of properties with profits made from Tai Lin. He died when the Deceased was about 18 years old. The Deceased then operated Tai Lin with the help of members of the family.

5.2.  The shares of Tai Lin were owned by the Deceased, his younger brother (“the brother”) and their mother. Tai Lin was successful until the late 1990's when it began to suffer losses. The Deceased resigned as a director on 21 August 1998[3], after the brother had returned from overseas to take over the running of Tai Lin. The Deceased did not work thereafter.

Relationships

6.1.  In 1974, the Deceased married the 2^nd plaintiff (“the Wife”). There were born to the Deceased and the Wife, Eric (the 1^st plaintiff) who was born in 1976, and Kenneth (the 3^rd plaintiff) who was born in 1978. (For convenience, Eric and Kenneth are referred to collectively as “the 2 Sons”).

6.2.  In the mid-1980’s, the Deceased began an extra-marital relationship with Madam Tam. There were born to the Deceased and Madam Tam 3 children, born in 1987, 1989, and 1996 respectively.

7.  In 1994, the Wife commenced proceedings for divorce in DJ6670/1994. A Consent Order annexing a Deed of Settlement (“the Deed of Settlement”)[4] was made on 27 July 1995. Although a decree nisi was granted the same day, no decree absolute was granted during the Deceased’s lifetime because he remained in default of payment of a sum of $29 million, being the balance of the lump sum due to the Wife under the Deed of Settlement.

The Deceased’s strokes and medical condition

8.  In view of the arguments on appeal, it is necessary to set out in some detail the evidence relating to the strokes suffered by the Deceased and his medical condition.

1995 Stroke

9.1.  On 23 August 1995, the Deceased suffered his 1^st stroke (“the 1995 Stroke”). The cause of this stroke was a cerebral haemorrhage. He was admitted to Queen Elizabeth Hospital (“QEH”) where he was treated by his friend Dr Lee who was a neurosurgeon.

9.2.  The Deceased was hospitalised for at least two weeks, although Dr Lee was under the impression that he was hospitalised for about 1 month in all[5]. (The medical records from QEH relating to the 1995 Stroke were produced at the trial[6], but there was no discharge summary).

1999 Stroke

10.1.  About 8 months after the Deceased ceased to be a director of Tai Lin, on 5 April 1999, the Deceased suffered his 2^nd stroke (“the 1999 Stroke”). The cause of this stroke was a cerebral infarct, i.e. “death of brain tissue due to blockage of a blood vessel”[7]. He was admitted to QEH again and was treated by Dr Lee and his team. The Deceased was hospitalised for a week.

10.2.  In Dr Lee’s witness statement[8], he adopted parts of a report made by Dr Yu dated 13 July 2015 (“Dr Yu’s 2015 Report”)[9], including the following:

“In April 1999, the Deceased was admitted to QEH for a second episode of stroke. The Deceased presented with right hemiparesis and dysarthria[10]. MRI brain and MR angiogram (MRA) on 15^th April 1999 revealed a lacunar infarct at the left pons, ischaemic[11] changes in the peri-ventricular region, features of the previous basal ganglia haemorrhage, and decrease in the number of left middle cerebral artery cortical branches. While there was near complete recovery of his speech and limb functions, impairment in his higher mental functions became more marked”. (Emphasis added).

10.3.  The impact of the 2^nd stroke (which preceded the 1999 Will) on the Deceased’s mental condition was a significant issue at the trial and on appeal.

11.1.  The medical records from QEH relating to the 1999 Stroke were produced at the trial[12]. The discharge summary on 12 April 1999 stated “Slurring speech and Rt limbs weakness improved gradually”. It did not specifically mention the Deceased’s mental functions.

11.2.  At trial, Dr Lee and Dr Yu were questioned about the absence of specific mention of the Deceased’s mental functions in the QEH discharge summary.

-  Dr Lee said that it could have been omitted as the discharge summary was written up only by junior doctors. However by the time of trial, he could not remember what was the situation with the Deceased’s mental functions due to the passage of time[13].

-  Dr Yu said that “this was a clinical management of patient with stroke, and so the document [the discharge summary] may not go into a detailed examination or examination of the high mental functions” and that “it is of course good practice to have this information in, for let’s say normal mental function, and so on. But if it’s not, I do not think this is below standard”[14].

Dr Lee’s assessment in June 1999

12.1.  On 25 June 1999, about 10 weeks after his discharge from hospital after the 2^nd stroke, the Deceased applied to Sun Life Assurance Co of Canada (“Sun Life”)[15] for a waiver of premium, on the ground of “total disability”.

12.2.  Sun Life’s service agent[16] filled in a form entitled “Total Disability Claim” (“the Disability Claim form”) with information supplied by Madam Tam. It was signed by the Deceased as claimant.

12.3.  The “Claimant’s Statement” in the Disability Claim form included the following:

-  the first symptoms of his illness appeared on 23 August 1995 (the date of the 1995 Stroke);

-  he has been so disabled by this disability as to be prevented from performing any work for compensation or profit or from following any gainful occupation since 1998;

-  such disability has existed continuously to present date;

-  to the question on his present state of health and description of how his condition prevents him from working, the answer was “memory system damaged, unable to deal with original work”[17] (emphasis added); Dr Lee said in his witness statement that this answer was “written down pursuant to my consultation and assessment on the Deceased”[18];

-  he (the Deceased) did not expect to be able to resume work, either full or part-time.

12.4.  In connection with the claim of total disability, Dr Lee filled in a document entitled “Attending Physician’s Statement of Disability” dated 3 August 1999 (“the Physician’s Statement”), which included the following information and answers:

(2)  Diagnosis

(a)  Diagnosis: Bilateral Intracerebral Haemorrhage, Cerebrovascular Disease

(c)  Subjective symptoms: Dysphasia[19] and Right Hemiparesis

(d)  Objective findings: MRI Brain Scan showed bilateral[20] internal capsule infarcts.

(8)  Mental/Nervous Impairment:

-  Class 3 - Patient is able to engage in only limited stress situations and engage in only limited interpersonal relations (moderate limitations).

-  Do you believe the patient is competent to endorse cheques and direct the use of the proceeds thereof?  Yes.

12.5.  Pausing here, in connection with the answer to the last question, Dr Lee said that he had directly asked the Deceased this question, and believed he was able to give “a simple and direct answer, which does not require any sophisticated cognitive function and reasoning”[21] (emphasis added). The Physician’s Statement continued as follows.

(9)	Prognosis
		Patient’s Job	Any Other Work
(a)	Is patient now totally incapacitated?	Yes	Yes
(c)	When do you expect patient will recover sufficiently to resume work?	Never	Never
(10)	Rehabilitation:
(a)	Is patient a suitable candidate for trial employment?	No	No
(d)	Explanation: “Patient suffered from cerebrovascular disease with residual neurological deficits. He would not be able to manage and run a large company”.

12.6.  In connection with the above, the following is notable.

(1)  Dr Lee said he wrote his answers at (9) and (10) after conducting an assessment of the Deceased. His usual and standard practice for such assessment was to refer to the patient’s medical history and records, and exchange dialogue and interactions with the patient, including asking him to do “simple subtractions (eg 100 -7 =?)” [“the Serial 7 test”][22].

  The Serial 7 test is part of the Mini Mental State Examination (“MMSE”). Failing the Serial 7 test meant that, even if the patient passed all the other parts of the MMSE, “it is very likely that he will have a score suggestive of intellectual and memory impairment”[23] and that “it is very likely that he is suffering from moderate to severe intellectual impairment”[24].

(2)  In his oral testimony at trial, Dr Lee added:

-  the Deceased was also 100% incapacitated from doing “any other work”[25];

-  the Deceased “could perhaps” work in a shop[26];

-  the purpose of the Disability Claim form was to enable the Deceased to claim insurance as he could no longer run Tai Lin[27]; but

-  a person who was unable to give an answer to “100 – 7” might not be able to run a small company either[28].

12.7.  This was the last medical assessment of the Deceased’s condition before he made the 1999 Will. However, subsequent medical reports of the Deceased also threw light on his condition at the relevant time in 1999.

Dr Yu’s assessment in 2000

13.1.  In February 2000, the Deceased started to consult Dr Yu, a specialist in neurology in private practice, for management of his stroke. Dr Yu made handwritten notes after each consultation.

13.2.  In Dr Yu’s notes of the Deceased’s first visit (21 February 2000), he assessed the Deceased’s “mentation” (meaning cognitive function)[29] as “slow”[30], but there was “no obvious dysphasia”.

13.3.  In order to discover the underlying cause of the Deceased’s strokes so that he could provide effective preventive therapies[31], Dr Yu admitted the Deceased to the Hong Kong Sanatorium and Hospital (“HKSH”) for investigations and obtained the following materials:

-  an MRI brain scan done on 24 February 2000 (“the February 2000 brain scan”)[32], and

-  CT/MRI brain films and other medical records of the Deceased at QEH[33], which Dr Yu asked Dr Lee for and received on 26 February 2000[34].

13.4.  About a couple of weeks afterwards, on 15 March 2000, Dr Yu saw the Deceased again. Dr Yu noted that the Deceased was quicker than on the last visit, but he could not perform the Serial 7 test[35], which was “to test one’s concentration” and “also the ability to calculate”[36].

13.5.  The following day, on 16 March 2000 Dr Yu wrote a medical report (“Dr Yu’s 2000 Report”)[37] for purposes of medical management[38].

13.6.  After referring to the 1995 Stroke and the 1999 Stroke, Dr Yu wrote in the 2000 Report:

“While there has been near complete recovery of his speech and limb functions, there has been impairment in his higher mental functions more marked recently”. (Emphasis added).

13.7.  It would also be noted that in §4 of Dr Yu’s 2015 Report, when describing the Deceased’s condition in April 1999 (the 2^nd stroke), he wrote:

“While there was near complete recovery of his speech and limb functions, impairment in his higher mental functions became more marked”. (Emphasis added).

13.8.  One of the issues between the parties on appeal was whether, in light of §4 of Dr Yu’s 2015 Report when he was chronicling the Deceased’s condition in April 1999, there was already impairment in the Deceased’s higher mental functions in 1999.

13.9.  The following is the relevant evidence from Dr Yu under cross-examination (emphasis added):

[After Mr Albert Yau, Madam Tam’s counsel, referred to Dr Yu’s 2000 Report] -

“Q. Can I ask you, Doctor, you mentioned about higher mental functions previously, and can you tell us what you meant by ‘higher mental functions’?

A: Okay. The report was written on 16 March [2000], and at the first consultation I noted that he was mentally slow. That is in February [2000]. Then, on 15 March 2000, he could not do the serial 7 calculation ... That is the basis for my statement that there was impairment in his higher mental functions more marked recently.

Remember the context that he was the person in charge of a big electrical appliances company and if he could not perform the serial 7, that would mean an impairment in his higher mental functions”[39].

“COURT: ... You said that there was an impairment of his higher mental functions, in the context of a person in charge of a big electrical appliances company. Does it mean that if he were not in charge of a big electrical appliances company, in other words say a retired person or a person who is unemployed, you would not say that there was an impairment to his higher mental function? In other words, I’m trying to understand why do you say it is in the context of a successful businessman.

A: Okay. Thank you. If I may clarify my statement.

COURT: Yes.

A: Now, even a person who has primary education, let’s say primary 6, would be able to perform the serial 7 test with accuracy. So if a person in charge of this big electrical appliances company, if he cannot do this, that would indicate that there is a significant impairment of his higher mental functions. It’s just a matter of degree.

COURT: So when you say ‘in the context’, what you mean is that bearing in mind that he is a person who can run a large company, the fact that he can’t do the serial 7 test must mean that there had been an impairment of his higher mental capacity?

A: Yes.

COURT: Or higher mental functions; that’s what you meant?

A: Yes”.[40]

[After Mr Yau referred to §4 of Dr Yu’s 2015 Report]

“Q: Now, you mentioned, the last three lines:

‘While there was near complete recovery of his speech and limb functions, impairment in his higher mental functions became more marked.’

Now, you have been taken to the discharge summary. These words are not found there.

A: No.

Q: Thank you. And we have checked very carefully where these words first appear. It is in your report ... [Dr Yu’s 2000 Report]. That’s where you report – that’s where this ‘higher mental functions more marked recently’ first appeared ...

A: Yes.

Q: Now, can I ask you, when you refer to ‘impairment in his higher mental functions’, that was what you observed after you have seen [the Deceased]; is it the case?

A. Yes.

Q. It was not meant to be the observation or the diagnosis of the doctors after the 1999 stroke. It was not meant to be the observation of QEH as to the stroke in 1999.

A: It was not in the discharge summary. I cannot remember whether I had sight of the QEH medical records of that admission”[41].

(Emphasis added).

14.1.  It would be noted from the above that although Dr Yu agreed that:

-  the words “impairment in higher mental functions” first appeared in the 2000 Report and

-  the words “more marked recently” referred to the Deceased’s condition between the 2 consultations in February and March 2000,

Mr Yau did not[42] specifically challenge Dr Yu on his opinion that “impairment in his higher mental functions became more marked” in §4 of the 2015 Report when he chronicled the Deceased’s condition in April 1999.

14.2.  Although Dr Yu agreed that there was an absence of reference to mental functions in the QEH discharge summary, it was not put to him that therefore Dr Yu had no basis for his opinion that the Deceased was impaired in his higher mental functions in 1999.

15.  Coming back to the narrative of events, after the investigations at HKSH, on 10 April 2000 and 8 November 2000, Dr Yu saw the Deceased again. The Deceased could not perform the Serial 7 test on either of those visits. On the April visit, he gave “103” as the answer to “100 – 7”, and on the November visit, he did not know the answer at all[43].

16.  Thereafter, the Deceased suffered further strokes. As Madam Tam has not appealed the judge’s finding of invalidity of the 2005 Will, the evidence of the Deceased’s mental condition is summarised below only for completeness or for any references which may be pertinent to his condition at the time of the 1999 Will.

2000 Stroke

17.1.  On 5 December 2000, the Deceased was admitted to QEH again because of weakness of the left limb[44]. Dr Yu was of the opinion that the Deceased either had a 3^rd stroke (“the 2000 Stroke”) due to cerebral infarct, or a psychogenic disturbance. At QEH, the Deceased was prescribed medicines which included a drug for dementia[45].

17.2.  On 13 December 2000, Dr Yu wrote in a letter addressed to “whom it may concern” that[46]:

“[The Deceased] suffers from repeated strokes and as a result has impaired higher mental functions. His ability to handle financial matters and documents has been substantially compromised”.

2001 Physician’s Statement

18.  On 15 May 2001, Dr Yu filled in a Physician’s Statement for Sun Life stating that the Deceased’s symptoms included “mental slowing” and dysphasia[47]. He did not consider that the Deceased was competent to endorse cheques and direct the use of the proceeds thereof.

2001 Stroke

19.1.  On 21 September 2001, the Deceased had a 4^th stroke (“the 2001 Stroke”). He was admitted to HKSH where he was hospitalized for a week, and further investigations, including MRI and MRA of the brain, were done.

19.2.  On 22 September 2001, Dr Yu wrote a medical report[48] recounting the history of the Deceased’s previous strokes which also stated:

“[The Deceased] informed me that he had to attend court on 24^th September 2001. I have explained to him that because of the acute stroke, he is at present not medically fit to do so, and that he should apply for 6- to 8-week postponement of the court proceedings. I have also advised him that in view of his higher mental dysfunction, it may not be in his best interest to appear in court without legal representation”.

19.3.  The Deceased’s last consultation with Dr Yu was on 2 November 2001. Dr Yu noted that his “mentation and neurological status remained unchanged”[49].

20.  There is then an absence of medical evidence for some 4 years. According to Madam Tam, she arranged for the Deceased to stay on the Mainland in 2002 as she and her children emigrated to Canada[50].

Condition in 2005

21.  The next available medical records were dated February to November 2005[51] from the Hospital Authority (“HA”). The records stated that the Deceased was an “OAHR” (old aged home resident), he was in and out of HA hospitals and he was “non-communicable”. That was the last medical record before his 2005 Will. He died on 21 November 2005, with the cause of death stated as sepsis and multiple bed sores[52].

Psychiatric evidence

22.  As mentioned earlier, 2 psychiatrists gave evidence at the trial, Dr Chung for the plaintiffs and Dr Lai for Madam Tam. Neither had seen the Deceased during his lifetime.

23.  Dr Chung said in his expert report filed on 26 November 2015 that the result of the HKSH brain scan in February 2000 (after the 1999 Will, but before the 3^rd stroke) “suggests that the impairment of higher mental function is directly caused by the brain pathology”[53]. The scan showed “the presence of haemorrhagic infarcts and extensive ischaemic changes in the brain. The Deceased would suffer from intellectual and memory impairment caused by the brain pathology”[54].

24.1.  Dr Lai stated his opinion in an expert report filed on 10 March 2016 that the Deceased “had the mental abilities required in testamentary capacity to execute the will on 13 August 1999”[55]. However, it is notable that before expressing this opinion, Dr Lai had made the following statement:

“According to your instruction letter [from Madam Tam’s solicitors], a person having testamentary capacity is one that

(i) did understand the effect of his wishes under the will,

(ii) did understand the extent of property disposed thereunder, &

(iii) did recall the beneficiary named in the will and comprehend his relationship with that person”.

24.2.  The “instruction” at (iii) appears to be incorrect if it purports to state the 3^rd criterion of Banks v Goodfellow[56]. When informed of the 3^rdBanks v Goodfellow criterion at trial, Dr Lai accepted that when he wrote the report, he “did not know that he [the Deceased] had children that he needed to supply”[57].

24.3.  Dr Lai said that the HKSH brain scan indicated that “the underlying cause of impairment of cognitive function of [the Deceased] is likely a result of the previous cerebrovascular accidents and ischaemic changes”, and that the impairment “depends on the specific sites of the brain affected, and deficits in cognitive function are unevenly distributed with some functions affected and others relatively spared”. However, there was no analysis (by reference to the specific sites of the brain affected) of the distribution of deficits in cognitive function, or which of the Deceased’s mental functions had been affected or how.

24.4.  Further, at trial, Dr Lai’s evidence was as follows:

“COURT: May I attempt to formulate the question. If I am wrong, please let me know.

The proposition put to you, Dr Lai, is that unless you ask direct questions, as set out in paragraphs 45(1), (2) and (3) in the case [Banks v Goodfellow] – unless you ask those questions directly, all other questions designed to enable one to answer the three questions directly, purely by looking at the medical history and his medical records, you cannot come to a view on his mental capacity to make a will as defined in that case? Is that the question?

Do you understand the question, Dr Lai?

A: Yes, I understand your question. Thank you.

You see, as far as from psychiatric aspects are concerned, what I had tried to do is to indicate the mental abilities he had based on the available medical records. The absence of answers to these questions or absence of such questions, however, leaves the issue whether he did have an answer but he was not asked.

So I really do not know – well, this is not in an ideal situation.

Q: No, of course.

A: So I must say this.

Q: You cannot answer, is that it?

A: Yes”[58].

Financial affairs

25.  The Deceased’s financial affairs were complicated.

-  Deed of Settlement

26.1.  After the Wife petitioned for divorce from the Deceased in 1994, they entered into a Deed of Settlement on 27 July 1995. Under the Deed[59],

-  the Deceased agreed to pay the Wife for her sole benefit[60]a lump sum of $39 million, to be paid as to $5 million forthwith, $8 million within one month of the grant of the decree nisi, $13 million by 30 June 1996 and $13 million by 30 June 1997, secured by a pledge of the Deceased’s shares in Tai Lin and in Failand Ltd (“Failand”), a family property-holding company;

-  the actual care and control of the 2 Sons was granted to the Deceased;

-  the Deceased was solely responsible for the maintenance of the 2 Sons until they attained the age of 21 or finished full-time education up to first degree level, whichever was the later. (It was common ground that the Deceased had wanted the 2 Sons to be well-educated).

26.2.  However, the Deceased only paid $10 million to the Wife and failed to pay her the balance of $29 million.

26.3.  After the Wife issued a judgment summons on 10 August 2001, the Deceased, acting through solicitors, applied to vary the Consent Order. In a supporting affirmation made on 7 February 2002, he referred to his “limited functional capacity” by reason of his illness. His application was rejected by the Court on 5 June 2002. Nevertheless, the Deceased continued to be in default and never paid the balance of $29 million.

26.4.  Pausing here, it is notable that in the Deceased’s said affirmation, he said that the Wife had never maintained the 2 Sons. He said it was he who had “always provided maintenance for the two children, including, but not limited, to payment of all school fees”[61]. This is relevant to an issue in the appeal[62].

- Properties co-owned with brother and mother

27.1.  Apart from being shareholders of Tai Lin and Failand, the Deceased and the brother had since the late 1970’s to early 1980’s been the registered owners as tenants-in-common of a number of properties. However, before 1999, they were locked in disagreement as to the use of the properties. Further, the mother claimed to have an equal interest in the properties, a claim which the brother supported.

27.2.  The issue had not been resolved by the time of the 1999 Will. Suffice to say that the Deceased had inconsistent positions at various times in proceedings against the brother and their mother.

28.  Since Madam Tam has not appealed the judge’s finding of invalidity of the 2005 Will, it would not be necessary to recount further events relating to the Deceased’s financial affairs.

-  Bankruptcy

29.1.  We would however record that a bankruptcy order was made against the Deceased in 2003. The Official Receiver (“OR”) is the trustee in bankruptcy.

29.2.  At the commencement of this appeal, the court inquired about the OR’s position. Suffice it to say that the court was eventually provided with a letter dated 16 September 2021 from the OR to another firm of solicitors, to the effect that to that date, all provable debts of the Deceased including statutory interest had been fully settled, and that pending the outcome of the probate action, all the remaining assets including those not yet realised[63], will be passed to the personal representative. The letter also stated that the OR remained the trustee-in-bankruptcy and noted that the Deceased’s interest in one property was subject to a charging order.

29.3.  As the OR wished to be kept informed of the development of these proceedings, we direct that the appellant’s solicitors provide the OR with a copy of this Judgment within 48 hours after handing down.

30.  It is against the backdrop of the Deceased’s personal circumstances, his medical condition and his financial affairs as summarized above, that the court has to consider the issues in these proceedings concerning the Deceased’s Wills.

Wills

-  The 1987 Will

31.1.  In 1987 (about 4 months after Madam Tam gave birth to her first child by the Deceased), the Deceased made a Will (“the 1987 Will”)[64] in which he appointed the Wife (and whichever trustee company she should in her full discretion appoint) his executors and trustees, and gave his estate to the Wife and the 2 Sons in equal shares.

31.2.  According to the Wife’s witness statement[65], the Deceased told her about his affair with Madam Tam and said he felt ashamed. She said that at that time her relationship with the Deceased was good. The Deceased came home one night in August[66] 1987 with an envelope, and told her that he had gone to MK Lam & Co (the solicitors’ firm which prepared the 1987 Will), and made a will giving all his estate to her and the 2 Sons. The Deceased told her that he wanted to ease his mind just in case any accident happened to him. He then gave the 1987 Will to her and reminded her to put it in a safe deposit box at a bank.

31.3.  In light of one of the grounds of appeal[67], it is necessary to recount the evidence thereafter. The Wife said in her witness statement that after she took a look at the contents of the 1987 Will on the night that the Deceased gave it to her, she put it in a safe deposit box at the Hang Seng Bank (“the safe deposit box”) a few days later.

31.4.  Subsequently, on 7 May 2015, Eric made an affirmation of testamentary script producing the Will which he said “is in my possession and control” which was then lodged with the Registry.

31.5.  After the hearing of the appeal, on 30 May 2023, the Wife and Eric each filed an affirmation.

31.6.  In the Wife’s affirmation, she said that she had always kept the 1987 Will in the safe deposit box, except for an occasion in 2010, when she took it to her solicitors in the divorce proceedings for photocopies to be made. In 2011, she added Kenneth as an authorized person for the safe deposit box. In 2014, her other son Eric applied for legal aid and commenced the probate action. She told him that if he wished to have the original 1987 Will, she or Kenneth would take it out of the safe deposit box for him. As such, she considered that all 3 of them had possession, custody and control of the 1987 Will (prior to it being lodged in the Registry).

31.7.  In Eric’s affirmation, he confirmed the contents of the Wife’s affirmation to explain why he had earlier deposed that he had possession, custody and control of the 1987 Will (although he added that he did not in fact need to take the original out for the legal aid application in 2014, as the Wife had given him a photocopy made at the abovementioned solicitors’ office). He confirmed that the 1987 Will has been lodged in the Registry.

31.8.  Submissions were made by both parties on these new affirmations which will be discussed below[68].

-  The 1999 Will

32.1.  On 13 August 1999, about 4 months after the Deceased suffered his 2^nd stroke, the Deceased signed another Will (“the 1999 Will”)[69] in which he appointed Madam Tam his executrix and made her the sole beneficiary.

32.2.  The 1999 Will was attested by Kam Hung Ming (“Mr Kam”) a solicitor and Francis CF Kung, a legal clerk. The circumstances in which the 1999 Will was made will be discussed later. The original 1999 Will was given to the Deceased.

32.3.  As a matter of completeness, in 2001, the original 1999 Will was given to Ringo Ho (“Mr Ho”) a solicitor with another firm who was acting for Madam Tam’s BVI companies in litigation against the Deceased (where orders were eventually set aside[70]). However, Mr Ho lost the original 1999 Will, and did not find it until 2018.

-  The 2005 Will

33.  Madam Tam said that since Mr Ho had lost the 1999 Will, she and the Deceased thought it would be better for another will to be made. On 18 August 2005, the Deceased purportedly made the 2005 Will[71] containing the same contents as the 1999 Will. It was prepared by the same solicitor Mr Kam, who attended the Deceased (who was not able to communicate) at an old aged residents home. The Deceased’s thumb print and a cross mark appeared on the document. The Deceased died about 3 months later. The judge’s finding of invalidity of this Will is not the subject of appeal.

Proceedings

34.1.  In HCAP No.5 of 2015, the plaintiffs claimed (among other things):

(1)  a declaration that the 1999 Will and/or the 2005 Will be declared void and of no legal effect, and

(2)  the 1987 Will be proved in solemn form.

34.2.  In Madam Tam’s Re-Re-Re Amended Defence and Counterclaim (“Re-re-re Amd D &CC”),

-  she did not admit that the Deceased had made the 1987 Will[72]; and

-  counterclaimed (among other things) for declarations that:

(a)  the 1987 Will had been revoked,

(b)  the 2005 Will was valid and enforceable, and should be admitted to probate; and

(c)  (if the court were to find that the Deceased did not have the necessary mental capacity to execute the 2005 Will), the 1999 Will was valid and enforceable, and should be admitted to probate.

35.  In the Judgment, the judge listed the following issues of fact:

(1)  in respect of the 1999 Will,

(a)  whether the signatures thereon had been made by the Deceased, and the age of the ink;

(b)  whether the Deceased had testamentary capacity to make this will;

(c)  whether the Deceased had knowledge and approval of its contents;

(2)  in respect of the 2005 Will,

(a)  whether the Deceased had testamentary capacity to make this will;

(b)  whether the Deceased had knowledge and approval of its contents.

The judge’s Judgment

36.1.  Essentially, the judge found in respect of the 1999 Will that it was genuine[73] (i.e. it had been signed by the Deceased at that time), but that he did not have the requisite testamentary capacity[74]. As such, it was not necessary for the judge to consider if Madam Tam had proved the Deceased’s knowledge and approval of the same[75].

36.2.  The judge based his finding of lack of testamentary capacity on the evidence of the Deceased’s mental condition listed in §125(2) of the Judgment, including the medical records relevant to the 1999 Stroke, the Disability Claim form, Dr Lee’s Physician’s Statement as supplemented by his oral evidence, and the fact that in the summer of 1999, the Deceased was unable to discern 3 separate and repeated requests from Kenneth for payment of his university fees.

36.3.  The judge also took into account the fact that Mr Kam was not informed about the Deceased’s illness, and had admittedly[76] not asked the Deceased, questions relevant to ascertaining the Deceased’s testamentary capacity by reference to:

(1)  whether he was capable of understanding the nature of the act of making the 1999 Will and its effects;

(2)  whether he was capable of understanding the extent of his property which he was disposing of; and

(3)  whether he was able to comprehend and appreciate the claims to which he ought to give effect

(as per Banks v Goodfellow).

36.4.  The judge concluded, with reference to e.g. the effect of the 1999 Will on the 2 Sons, and the complex interests of the Deceased in various assets, that the 3 criteria had not been satisfied, noting that the Deceased was unable to pass the Serial 7 test, and that Dr Chung’s evidence was that the questions regarding the 3 criteria were “much more difficult” than those in the MMSE of which the Serial 7 test was one.

36.5.  As for the 2005 Will, the judge found that in addition to the lack of testamentary capacity[77], Madam Tam had failed to establish the Deceased’s knowledge and approval[78].

36.6.  Having thus disposed of Madam Tam’s case regarding the 1999 Will and the 2005 Will, the judge pronounced for the validity of the 1987 Will on the basis that Madam Tam had not challenged its formal or substantial validity[79].

The judge’s Order

37.1.  The judge:

(1)  pronounced for the 1987 Will,

(2)  dismissed Madam Tam’s counterclaim, and

(3)  made a costs order nisi that Madam Tam shall pay the plaintiffs’ costs of the action.

37.2.  In relation to the costs order, Madam Tam filed a summons on 31 December 2020 to vary the costs order nisi. The plaintiffs then filed a summons on 4 January 2021 to clarify or alternatively to vary the costs order nisi.

Appeal

38.  On 11 January 2021, Madam Tam lodged a Notice of Appeal. On 1 February 2021, the plaintiffs filed a Respondent’s Notice. This will be referred to as “the substantive appeal”.

39.  There are 3 subsequent matters which we would mention here first.

40.1.  First, the judge handed down his Decision on the applications to vary the costs order nisi on 28 April 2023. The only variation was that costs to the plaintiffs were to be taxed on the basis of certificate for 2 counsel, with legal aid taxation for a specified period of time.

40.2.  On 15 May 2023, the eve of the hearing of this appeal, Madam Tam filed a summons for leave to file a Supplementary Notice of Appeal in relation to costs. This will be referred to as “the proposed costs appeal”.

40.3.  At the commencement of the hearing of the substantive appeal, as the parties had not filed submissions relating to this summons, we indicated that directions would be given in this Judgment in relation to the proposed costs appeal.

41.1.  Second, on the issue of possession custody and control of the 1987 Will, the plaintiffs’ counsel asked at the hearing of the appeal for leave for the Wife and Eric to each file an affirmation within 14 days, simply to prove the chain of custody. The court indicated that it would consider the affirmations de bene esse.

41.2.  On 30 May 2023, the Wife and Eric each filed an affirmation relating to the above[80]. The parties then filed submissions on 5 June 2023 and 12 June 2023 which will be discussed later in this Judgment[81].

42.1.  Third, on 16 June 2023, Madam Tam filed a summons for leave to amend her notice of appeal to add a ground that the judge had extensively copied the plaintiffs’ closing submissions on the issue of the Deceased’s testamentary capacity. Written submissions were filed in July and August 2023.

42.2.  For reasons set out in a Judgment[82] handed down on 15 September 2023, this court dismissed the summons with costs. In any event, we have examined the materials in the case in considerable detail.

Discussion on the substantive appeal

43.  Mr Yau’s principal argument was that “with the presumption of capacity and given that knowledge and approval have been proved, the 1999 will should be admitted to probate without the need to examine if the Banks v Goodfellow criteria are met”[83].

44.  We consider this argument is wrong for a number of reasons.

45.1.  First, regarding the “presumption of capacity”, Mr Yau sought to take a “preliminary point” that the presumption was not displaced by the evidence adduced by the plaintiffs. Mr Yau referred to a passage (§34.34) in the 31^st edition of Tristram & Coote’s Probate Practice, which is now (as revised) §34.41 of the 32^nd edition of that work (published in 2020).

45.2.  The passage now reads as follows:

“The law as to the burden of proof was summarised in Ledger v Wootton [2007] EWHC 90 (Ch) as: (a) the burden is on the propounder of the will to establish capacity; (b) this remains the case even if the propounder has already obtained a grant in common form; (c) where a will is duly executed and appears rational on its face, then the court will presume capacity; (d) an evidential burden then lies on the objector to raise a real doubt about capacity; (e) once a real doubt arises there is a positive burden on the propounder to establish capacity. The modern approach is to address the question of capacity as an evaluation of all the evidence available to the court at trial: Burns (Deceased) Re [2016] EWCA Civ 37, 18 ITELR 706 followed in Goss-Custard v Templeman [2020] EWHC 632 (Ch)”.

46.1.  We do not think that the court could stop at step (c), the “presumption of capacity”, in this case. This is not a case where the only evidence before the court was evidence of due execution and an apparently rational will.

46.2.  There is before the court considerable medical evidence relating to the Deceased’s mental condition at the time of the 1999 Will (13 August 1999), in particular evidence of the April 1999 stroke, and in particular,

-  the Disability Claim form on 25 June 1999 stating “memory system damaged”, which Dr Lee said was “written down pursuant to my consultation and assessment on the Deceased”[84];

-  Dr Lee’s Physician’s Statement on 3 August 1999 which referred to the QEH MRI Brain Scan showing infarcts (death of brain tissue), and his assessment (after referring to the patient’s medical history and records, and exchange of dialogue and interactions, including the Serial 7 test) that the Deceased was 100% incapacitated for any work, would never recover sufficiently to resume work, and would not be able to run a company big or small.

47.1.  As mentioned above, Mr Yau challenged Dr Yu’s statement in his 2015 Report that as a result of the 1999 stroke, “while there was near complete recovery of his speech and limb functions, impairment in his higher mental functions became more marked” on the basis that it was not in the QEH discharge summary, and similar words (without “recently”) first appeared in his 2000 Report. Mr Yau argued therefore that the judge was wrong to say that the evidence relating to the 1999 stroke was “indisputable” (§125(b), Judgment).

47.2.  In our view, there is no substance in that argument. The fact that the QEH discharge summary did not refer to impairment in mental functions does not per se contradict Dr Yu’s opinion on the state of the Deceased’s mental condition after the 1999 stroke for reasons given by Dr Lee and Dr Yu[85], and Mr Yau acknowledged that he had not specifically challenged Dr Yu that there was no basis for his use of those words in §4 of the 2015 Report on the Deceased’s condition in April 1999.

47.3.  In fact, Dr Yu was consulted only a few months after the Deceased’s 1999 stroke and he undertook investigations of the underlying cause of the Deceased’s repeated stroke. For that purpose, he had access to all the Deceased’s medical records including MRI brain scans done at QEH and HKSH. He also treated the Deceased until 2001, and MRIs were also performed on the Deceased during this period. Being in a position to track the Deceased’s condition from 1995 to 2001, there is no reason to doubt his statement in the 2015 Report of the Deceased’s condition in April 1999 after the 2^nd stroke.

47.4.  Further, Dr Lee, who was the Deceased’s attending physician in 1999, adopted §§3-5 of Dr Yu’s 2015 Report (including the reference to “impairment in his higher mental functions became more marked” in §4) in his witness statement[86] “as Dr Yu has correctly reported the condition of the Deceased at that time by making reference to those medical notes/records of QEH”[87].

47.5.  Indeed, in §25 of the witness statement, Dr Lee said “between 23 August 1995 and the end of 1999, it was both my impression and my recollection that there was serious damage to the Deceased’s brain ...”. Dr Lee was the treating doctor of the Deceased from 23 August 1995 to “about the end of 1999”, but there were no further medical incidents between the 1999 stroke and the end of 1999. Accordingly, the reference to “serious damage to the Deceased’s brain” would have occurred as a result of the 1999 stroke, and not anything that occurred after the date of the 1999 Will in August 1999.

48.1.  Mr Yau also argued that the evidence from Kenneth that the Deceased forgot to pay his university fees despite prompting a few times did not feature in his pleadings or witness statement.

48.2.  However, the mere fact that this piece of evidence was elicited during cross-examination does not detract from its admissibility or credibility or reliability, and Mr Yau has not explained why that piece of evidence should not be part of the evaluation of all the evidence available to the court.

49.  In the light of all this evidence, it would be wrong if the court simply applied the presumption of capacity.

50.  Second, contrary to Mr Yau’s submissions, knowledge and approval of the 1999 Will have not been proved. The judge did not have to deal with it because of his finding that there was no testamentary capacity. In doing so, he referred to Au Kong Tim where Kwan JA (as she then was) followed Sir Andrew Morritt C’s statement in Perrins v Holland [2011] Ch 270 at [31] that “plainly testamentary capacity is a prerequisite to knowledge and approval because if the former is not shown there is no need to look for the latter”.

51.1.  Third, coming to the 3 criteria in Banks v Goodfellow (satisfaction of all 3 being required), the evidence is clear that at least the 2^nd and the 3^rd criteria (and in particular, the 3^rd criterion) were not met in this case of an infirm testator.

51.2.  Importantly, for the 3^rd criterion, the 1999 Will did not provide at all for the 2 Sons who were then still at university, and who were beneficiaries under the 1987 Will.

51.3.  As:

(a)  it was common ground that the Deceased wished his children to be well-educated, and

(b)  under the Consent Order, it was the Deceased (not the Wife) who obtained actual care and control of the 2 Sons and undertook sole responsibility for their maintenance until they finished full-time education up to first degree level[88],

the non-provision for the 2 Sons under the 1999 Will is a very weighty piece of evidence against testamentary capacity.

51.4.  Mr Kam admitted that before preparing the 1999 Will, he did not ask the Deceased how many children he had, or who depended on him for their livelihood, or whether he had made a will previously[89].

52.1.  There was no evidence explaining why the Deceased might have intended not to provide for the 2 Sons in the 1999 Will. Indeed, Mr Yau confirmed that “subsequent events showed that the [the Deceased] did not default in his maintenance of these 2 sons, despite his financial difficulties”[90].

52.2.  Further, Mr Yau submitted that the Deceased’s obligations under the Consent Order to maintain the 2 Sons would not be binding on his estate and would be put to an end upon his death[91]. That is a self-defeating submission, as there would be all the more reason for the Deceased to provide for the 2 Sons in his will.

53.1.  Mr Yau also referred to Madam Tam’s evidence that she owned a number of properties in her name, but she was “not sure” if she was in “negative equity territory” in1999.

53.2.  However, that is not to the point. The issue is not whether there was an “either/or” situation between Madam Tam and the 2 Sons, where the Deceased was compelled to choose between one or the other. Mr Yau’s submissions, which are based on the Deceased having considered how much the 2 Sons needed in the future, ring hollow when one considers the Deceased’s loss of the ability to calculate, as shown by his failure to pass the Serial 7 test.

54.  The question is whether, in light of the medical evidence, the court can be satisfied with the Deceased’s testamentary capacity when he made the 1999 Will in which he had not even mentioned the 2 Sons, let alone made any provision for them. In our view, as in the judge’s, the answer is No.

55.1.  The 2^nd criterion for testamentary capacity is whether the testator was capable of understanding the extent of the property which he was disposing of. As Mr Kam admitted, he never asked the Deceased any questions about it.

55.2.  At the time of the 1999 Will, the Deceased’s financial affairs were complicated. There were disagreements with his brother on the use of co-owned properties and the property-holding family company, and with the brother and their mother on whether she had an equal interest, which would obviously result in the reduction of the Deceased’s interest.

56.1.  Mr Yau submitted that “where the nature of the testator’s assets are [sic] complicated and varied, the court should allow the testator some latitude if he has difficulties describing his assets accurately”[92].

56.2.  However, the point is not whether a testator needed to describe all his assets or had left any out. When the issue is testamentary capacity, obviously the more complicated his financial affairs, the greater intellect would be required to understand what property he had for disposition and distribution. At the time of the 1999 Will, the Deceased’s interest in the properties co-owned with his brother was either ½ (if the mother was excluded) or 1/3 (if the mother was included). Obviously, that would affect the extent of his worth and how it could be distributed. However, the Deceased’s failure to pass the Serial 7 test showed that he lacked, not only concentration, but also the ability to calculate, which clearly would have an impact on relevant considerations such as what property he had, and what would be required for different persons.

57.  For the above reasons, we consider that the finding of invalidity of the 1999 Will should be upheld.

58.  We shall now deal with the ground of appeal relating to the 1987 Will. At the conclusion of the Judgment, the judge pronounced for the validity of the 1987 Will by decreeing probate of it in solemn form[93].

59.1.  The argument advanced on behalf of Madam Tam is that:

(a)  the plaintiffs did not prove due execution as they did not call any attesting witnesses, and

(b)  although the plaintiffs relied on the rule for proving ancient documents, they had not satisfied the proper custody requirement in that rule.

59.2.  In their Respondents’ Notice, the plaintiffs contended that:

(1)  an affirmation of testamentary scripts had been made on 7 May 2015 and the Will lodged in the Registry on 8 May 2015 pursuant to Order 76 rule 5(2) RHC[94];

(2)  on the face of the document, the 1987 Will was regular, and the presumption of due execution applied; no challenges to its formal and/or substantial validity were made by Madam Tam in her pleadings or evidence; and

(3)  the 1987 Will was an ancient document of more than 20 years produced from proper custody and s.43 Evidence Ordinance cap. 6 applied[95].

60.1.  Looking first at the pleadings, the plaintiffs had pleaded the 1987 Will in their Re-Amended Statement of Claim thus:

“4. On 3.9.1987, the Deceased made a formal will (“the 1987 will”) making the 1^st to 3^rd plaintiffs as the only beneficiaries of his estate upon his death. The 1987 will has never been revoked whether by operation of law or otherwise up to the date of his death”.

60.2.  The Re-Re-Re Amd D & CC had pleaded in respect of the 1987 Will:

“5. As to paragraph 4,

(a) the 1^st sentence is not admitted;

(b) the 2^nd sentence is denied. It is specifically denied that the 1987 Will has never been revoked[96]. For reasons pleaded in paragraphs 7, 8[97], 10 and 11[98] below, the 1987 Will has been expressly and/or impliedly revoked by the Deceased and lost all its effect as a testamentary instrument”.

61.1.  There was no pleading from the defendant denying execution or attestation, and no evidence contradicting these acts. On the face of 1987 Will, there is no reason why the presumption of due execution would not apply. There is no authority supporting Mr Yau’s argument that where a party seeks an order that a will is proved in solemn form, this presumption cannot apply[99]. In contested cases where the presumption was successfully applied[100], the will is “pronounced for”, a term used where the claim is for probate in solemn form[101].

61.2.  This presumption is explained in Williams Mortimer and Sunnucks § 9-31 as follows:

“There is no absolute necessity for positive evidence of due execution in order to enable the court to pronounce for a will. The court will take into account the circumstances and judge from them collectively whether or not there was due execution ...

The presumption that everything was properly done (omnia rite et solemniter esse acta) arises whenever a will, regular on the face of it and apparently duly executed, is before the court, and amounts to an inference, in the absence of evidence to the contrary, that the requirements of the statute have been duly complied with”.

61.3.  The presumption does not only apply where the witnesses are dead. It applies even if they are called and give evidence that they do not recall having witnessed the testator’s execution. (Indeed, the strength of the presumption is so strong that it has been held to apply even where a witness testified that he did not intend to attest that he saw the testator sign the will)[102]. Accordingly, the fact that the plaintiffs had not procured witness statements from, or had not called, the witnesses to the 1987 Will (assuming they are alive) does not defeat the presumption. As noted earlier, there was no pleading from the defendant denying execution or attestation, and no evidence contradicting these acts.

62.  And as the judge observed in §179 of the Judgment, Madam Tam had not in her pleadings challenged the formal or substantial validity of the 1987 Will.

63.1.  As we understand it, Mr Yau’s complaint now is of a “lacuna” in the evidence relating to the chain of custody of the 1987 Will from the Mother (to whom the Deceased had given it) to Eric, who had lodged it in the Registry.

63.2.  However, this “chain of custody” point was not argued at trial. There was no cross-examination of the Wife on the custody of the will, and there was no challenge to Eric’s evidence in the affirmation of testamentary scripts or the lodging of it in the Registry. In Mr Yau’s opening submissions at trial, no issue was raised in respect of possession and custody, cf the issue whether witnesses were required to be called to prove due execution (§§11 and 13, Defendant’s Opening Submissions). In his closing submissions, the 1987 Will did not feature at all[103].

63.3.  It may be that Mr Yau’s present complaint came about because the plaintiffs had relied at closing on the rule for proving ancient documents (which applies to wills[104]) which overrides s.42 Evidence Ordinance (this rule was not argued in Chow Siu Po v Wong Ming Fung HCAP3/1998, DHCJ Lam, as he then was). This rule is summarized as follows in Phipson on Evidence §40-36:

“In any proceedings, whether civil or criminal, private documents not less than 20 years old, produced from proper custody, and otherwise free from suspicion, prove themselves, and no evidence of the handwriting, signature, sealing or delivery need, in general, be given. The 20 years date from the execution of the document, and, even in the case of wills, not from the death of the testator. ...” .

In relation to “proper custody”, it is said in Phipson that this means the deposit of the document “with a person[105] and in a place[106] where, if authentic, it might naturally and reasonable be expected to be found. Such a custody is sufficient, although there might be another which would be more strictly and absolutely proper”.

63.4.  Mr Yau accepted that the “lacuna” in the “chain of custody” did not form any part of his written closing submissions at trial, and when counsel for the plaintiffs referred the judge to the rule proving ancient documents, Mr Yau did not advance any argument that it was not applicable for want of evidence as to the chain of custody.

63.5.  Had Mr Yau done so, it would have been open for the Wife and Eric to be recalled to give evidence as per their affirmations filed after the hearing of the appeal.

63.6.  Under these circumstances, we do not consider the rule in Ladd v Marshall[107]applies, given that Mr Yau had not advanced any argument before the judge that the rule proving ancient documents was not applicable for want of evidence as to the chain of custody. It was simply not an issue[108], and a party can only be expected to adduce evidence on matters that are in contention. This is the rationale of the “state of the evidence bar”[109].

63.7.  Having said that, since this is a probate matter where the court has inquisitorial functions, we would give leave to the plaintiffs to adduce the affirmations of the Wife and Eric filed on 30 May 2023 so that there would be no possible doubt on the chain of custody. Whilst these affirmations could have been better drafted, in that there were no details showing when and how the 1987 Will was taken from the safe deposit box for Eric to lodge with the Registry, we consider they are adequate to show how all the plaintiffs had possession, custody and control of it.

Disposition

64.  For the reasons set out above, we would:

(1)  give leave to the plaintiffs to adduce the affirmations of the Wife and Eric filed on 30 May 2023;

(2)  dismiss the substantive appeal with an order nisi that the costs of this appeal be paid by the defendant to the plaintiffs;

(3)  direct that the appellant’s solicitors provide the OR with a copy of this Judgment within 48 hours after handing down; and

(4)  give leave to the parties to file submissions[110] within 14 days of the date of this Judgment on the proposed costs appeal. The matter will then be dealt with on paper.

Mr K M Chong, Mr Alvin Chong and Mr Tyrone Tang, instructed by T K Tsui & Co, for the 1^st to 3^rd plaintiffs

Mr Albert Yau and Mr Bache Sit, instructed by Ivan Tang & Co, for the defendant

CACV 10/2021

[2023] HKCA 1066

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 10 OF 2021

(ON APPEAL FROM HCAP NO 5 OF 2015)

__________________

__________________

_____________________________________________________

J U D G M E N T
(Defendant’s summons to amend the Notice of Appeal)

_____________________________________________________

Hon Yuen JA (giving the Judgment of the Court):

Background

1.  In HCAP No.5 of 2015, judgment was given by W Chan J (“the Judge”) on 14 December 2020¹ after an 18-day trial in the matter of the estate of Lam Chok Wai (“the Deceased”). 

2.  The issues at trial included:

-  the genuineness of the Deceased’s signatures on, and the ink-dating of, a will made in 1999 (“the 1999 Will”), and

-  the Deceased’s testamentary capacity, and knowledge and approval, in respect of the 1999 Will and another will made in 2005 (“the 2005 Will”). 

3.  The defendant, the Deceased’s co-habitant, was the sole beneficiary under both these wills.  An earlier will (“the 1987 Will”) of the Deceased benefitted the plaintiffs (the 2^nd plaintiff being his wife and the other two plaintiffs, their sons). 

4.  The trial involved evidence from doctors who had treated the Deceased after he suffered some strokes, legal professionals who had attested the 1999 Will and the 2005 Will, and expert witnesses on handwriting and ink-dating. 

5.1  In the judgment, the Judge found that the 1999 Will had indeed been signed by the Deceased in 1999, but that he did not have testamentary capacity to make the will. 

5.2  As for the 2005 Will, the Judge found that the Deceased did not have testamentary capacity to make the will, and he did not know and approve of its contents. 

5.3  The Judge then pronounced in solemn form for the 1987 Will. 

6.  The defendant filed an appeal on 11 January 2021, and the plaintiffs filed a respondent’s notice on 1 February 2021.

7.  The appeal was heard on 16 May 2023, after which judgment was reserved.

The defendant’s summons to amend the Notice of Appeal

8.1  On 16 June 2023 however, the defendant issued a summons in this court for the following orders:

(1)  leave to amend her Notice of Appeal to raise an additional ground;

(2)  service of the Amended Notice of Appeal be dispensed with;

(3)  directions from the court regarding the restoration of the appeal for the hearing of the additional ground.

8.2  The additional ground of appeal which the defendant seeks leave to argue is as follows:

“On the issue of the Deceased’s testamentary capacity (“the Issue”), the learned Judge has extensively copied (virtually verbatim and in exact format) the Plaintiffs’ closing submissions thereby ignoring to mention or discuss the evidence and arguments put forward by the Defendant.  That led a reasonable person to conclude that the learned Judge did not put his mind to the evidence and issues in dispute and did not render an impartial and independent decision.  In such circumstances, the Court of Appeal should not accord to the learned Judge’s determination on the Issue the customary respect which it would otherwise do as to the weight he attached to a particular piece of evidence and to his ultimate conclusion”.

8.3   The additional order which the defendant seeks to add is as follows:

“Further in the alternative, there be a retrial on the issue of the Deceased’s testamentary capacity before another judge”².

9.1  The summons was supported by an affirmation of the defendant’s solicitor Mak Hing Kwan filed the same day.  Ms Mak said that on 13 June 2023, the defendant and her legal team became aware of the Court of Appeal’s decision in Wong To Yick Wood Lock Ointment Ltd v Singapore Medicine Co and Others³(handed down on 9 June 2023), which set aside the judge’s judgment on the ground of “judicial copying”.  Ms Mak then said [§4]:

“The decision rang a bell for the Defendant’s legal team because they always had the impression that the learned Judge copied rather extensively the Plaintiffs’ submissions in his Judgment of this case, as in Wong To Yick” (underlining added).

9.2  Ms Mak then compared passages in the Judgment with the submissions of the respective parties, in particular the plaintiffs’ submissions on the issue of the Deceased’s testamentary capacity when he made the 1999 Will.      

10.  In the plaintiffs’ solicitor’s affirmation in opposition, apart from referring to the issues⁴ in which the Judge had found in favour of the defendant, it was disclosed that the solicitor who attested the 1999 Will and the 2005 Will, who had given oral evidence at the trial, has since died.

Discussion

11.  In accordance with general practice⁵, the application for amendment will be resolved by way of a paper application without an oral hearing.

12.  In July and August 2023, the parties filed written submissions which we have considered.

13.1  In the defendant’s submissions, counsel sought to explain the application to raise the additional ground now by submitting that the Wong To Yick judgment had “broken new ground” in the area of the law on judicial copying. 

13.2   We do not agree.  Some 18 years before Wong To Yick, the Court of Final Appeal had in Nina Kung v Wong Din Shin⁶ proscribed “judicial copying” in the sternest terms, holding:

“448. The fundamental point is that a judge must bring an independent mind to his judicial function and be seen to do so. Wholesale copying of one side’s submissions is bound to raise doubts in the mind of the other side as to whether this has occurred and whether the points made by that other side’s behalf have been adequately considered. ... ”.

13.3  The Court of Appeal had in a number of cases⁷ before Wong To Yick also referred to the above principle. 

14.1  However, the defendant’s counsel submitted that Wong To Yick was the first decision in which an appeal had succeeded on the ground of judicial copying “alone”⁸.  

14.2  That is neither here nor there.  Since 2005, legal professionals have been aware of the proscription against judicial copying in Nina Kung.  It has been advanced as a ground of appeal, among other grounds, in many cases.  Wong To Yick simply happened to be the first case where this ground was hived off from other grounds as a matter of case management. 

14.3  In other words, the allowing of the appeal in Wong To Yick on this ground was only the result of the court’s application of the above principle, which is well-established law.  Whilst (in an appropriate case) it may be said that ground is broken by new law, that cannot be said of simply the result of a case applying well-established law (as in Wong To Yick).

15.  No other reason has been given by the defendant why the additional ground was not raised earlier, even though as admitted in §4 of Ms Mak’s affirmation, the defendant’s legal team “always had the impression” that the judge had copied the plaintiffs’ submissions. 

16.1  Although the Court of Appeal has an untrammelled discretion to give leave to amend a notice of appeal, since the Civil Justice Reform, its power should be exercised with due regard to the underlying objectives in Order 1A of the Rules of the High Court⁹.  Notwithstanding the admitted awareness of the defendant’s legal team of the extent of copying, they did not raise it as a ground throughout the 2 years that had elapsed between the lodging of the appeal and the hearing of the appeal, and not until after judgment was reserved after the conclusion of the appeal hearing.  The additional ground would require a new date to be fixed for the hearing of the new ground of appeal.  No doubt that would take time (when the respondents are entitled to think that the appeal process was about to draw to a close) and of course, additional costs.

16.2  The underlying objectives of the rules of the High Court include increase in cost-effectiveness of proceedings, dealing with cases as expeditiously as reasonably practicable, procedural economy, and fairness between the parties. It is clear that to allow the amendment now would be contradictory to these objectives. 

17.  Accordingly, the defendant’s summons is dismissed with costs.  Having considered the plaintiffs’ statement of costs for summary assessment, we would assess the costs at $90,000.      

CACV 10/2021

[2021] HKCA 1388

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 10 OF 2021

(ON APPEAL FROM HCAP 5/2015)

________________________

________________________

________________________

DECISION ON COSTS

________________________

Hon Chow JA (giving the Decision on Costs of the Court):

1.  On 30 July 2021, this Court gave its decision (“the Decision”)  allowing the Plaintiffs’ application by summons dated 1 April 2021 for security for costs of the appeal, but in a form that was offered or substantially offered by the Defendant. The Plaintiff’s application was for the Defendant to pay into court the amount of $1,200,000, while the Defendant’s offer was to provide security by means of a surety’s guarantee to be given by her solicitors (Ivan Tang & Co)  for an amount in the region of between $700,000 and $800,000. For reasons given in the Decision which it is not necessary to repeat in this decision, the Court was of the view that the surety’s guarantee offered by the Defendant, up to the amount of $800,000, was sufficient to provide reasonable protection to the Plaintiffs in respect of their costs of the appeal.

2.  At §19 of the Decision, the Court made an order nisi that the costs of the application for security for costs be in the cause of the appeal.  The Court considered, provisionally, that an order that costs be in the cause of the appeal would reflect the justice of the case taking into account the fact that although the Plaintiffs were successful in obtaining an order for security for costs, the Defendant was successful in relation to the form of the security to be provided.  In addition, the Court considered that the amount of the security sought was excessive, and the amount of security eventually ordered by the Court was substantially reduced to $800,000 (from $1,200,000).  Nevertheless, the Court made the costs order on a nisi basis, because the Court was aware that there was some “without prejudice save as to costs” correspondence passing between the parties which might have a bearing on the issue of costs which the Court had not had an opportunity to consider.  Accordingly, at §18 of the Decision, the Court directed that any application to vary the costs order nisi “may only be made on the basis of matters disclosed in the ‘without prejudice correspondence’” [underlining original].

3.  On 11 August 2021, the Plaintiffs applied by summons to vary the costs order nisi.  The Court decided to deal with the application on paper, and gave directions for the filing and service of submissions.

4.  It is apparent from the Plaintiffs’ Submissions dated 20 August 2021 and Reply Submissions dated 3 September 2021 that the application to vary is principally based, not on matters disclosed in the “without prejudice save as to costs” correspondence, but on matters which this Court was aware of when it made the Decision and on matters of principle which this Court was familiar with.  While the Plaintiffs’ Submissions did refer to, inter alia, two letters marked “without prejudice save as to costs”, one from the Plaintiffs’ solicitors dated 5 February 2021 and the other from the Defendant’s solicitors dated 9 March 2021, those letters have little significance on the issue of the costs of the application for security for costs.  In particular, they do not alter the fact that the Defendant had, in the Affirmation of Lau Wing Chi Gigi filed on 3 May 2021, offered to provide the security sought by the Plaintiffs by means of a surety’s guarantee to be given by her solicitors, and the amount of the security ordered by the Court was substantially less than the amount sought by the Plaintiffs.  Had the Plaintiffs acted sensibly and reasonably to accept the Defendant’s offer at that stage, the subsequent costs incurred in relation to the application, and the court’s time in dealing with the application, would probably have been saved.

5.  Under Order 1A, r 3 of the Rules of the High Court, Cap 4A, parties and their legal representatives are both under a positive duty to assist the court to further the underlying objectives of the rules, including: (i)  ensuring that a case is dealt with as expeditiously as is reasonably practicable, (ii)  promoting a sense of reasonable proportion and procedural economy in the conduct of proceedings, and (iii)  ensuring that the resources of the court are distributed fairly.  These objectives are not promoted or furthered by an overly aggressive litigation attitude on the part of any party to a litigation or his/her legal representatives.  As events have turned out, the Plaintiffs’ insistence, presumably upon the advice of their legal representatives, to pursue the application for security in an amount which the Court finds to be excessive and in a form which the Court does not consider to be reasonably necessary for the protection of the Plaintiffs’ costs position, has not produced any material benefit to the Plaintiffs in so far as the application is concerned.

6.  Overall, this Court does not find any good or sufficient reason to vary the costs order nisi, which shall therefore be made absolute.  The Plaintiffs’ application to vary the costs order nisi is without merit and is dismissed with costs to the Defendant, which this Court summarily assesses at HK$35,000.

Mr K M Chong, Mr Alvin Chong and Mr Tyrone Tang, instructed by T K Tsui & Co, for the 1^st to 3^rd Plaintiffs

Mr Albert Yau and Mr Bache Sit, instructed by Ivan Tang & Co, for the Defendant

CACV 10/2021

[2021] HKCA 1083

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 10 OF 2021

(ON APPEAL FROM HCAP 5/2015)

________________________

________________________

____________________

DECISION

____________________

Hon Chow JA (giving the decision of the Court):

INTRODUCTION

1.  This is the Plaintiffs’ application for security of costs in respect of the Defendant’s appeal against the judgment of Wilson Chan J dated 14 December 2020 (“the Judgment”) pronouncing in solemn form for the force and validity of a will made by Mr Lam Chok Wai, deceased (“the Deceased”) dated 3 September 1987 (“the 1987 Will”) and dismissing the Counterclaim of the Defendant seeking to propound 2 later wills made by the Deceased dated 13 August 1999 and 18 August 2005 (“the 1999 Will” and “the 2005 Will” respectively) in solemn form.

2.  Having read the evidence and submissions filed by the parties, we consider that it is appropriate to determine the Plaintiffs’ application on paper without an oral hearing pursuant to Order 59, r 14A(1) of the Rules of the High Court, Cap 4A.

BRIEF BACKGROUND

3.  The 2^nd Plaintiff was the wife of the Deceased, and the 1^st and 3^rd Plaintiffs were the children of the 2^nd Plaintiff and the Deceased.  The Defendant was the mistress of the Deceased, although their relationship had been known to the 2^nd Plaintiff and other members of the Deceased’s family for many years prior to his death on 21 November 2005.  During his lifetime, the Deceased made, or allegedly made, the 3 wills mentioned above.

4.  At the trial, the Defendant did not raise any issue regarding the validity of the 1987 Will, but contended that it had been revoked by the 1999 Will and/or 2005 Will, under each of which the Defendant was appointed as the sole executrix and beneficiary of the Deceased’s estate.

5.  After a trial lasting some 18 days, the Judge, in the Judgment handed down on 14 December 2020, found that (i) the Deceased did not have testamentary capacity to make the 1999 Will, and (ii) the Deceased did not have testamentary capacity to make the 2005 Will, and did not “know and approve” the contents of the 2005 Will at the time of his execution thereof. Accordingly, the Judge found in favour of the Plaintiff, pronouncing in solemn form for the force and validity of the 1987 Will.

6.  Against the Judgment the Defendant filed and served a Notice of Appeal dated 11 January 2021.

7.  On 1 April 2021, the Plaintiffs issued the present summons seeking security for costs of the appeal in the amount of HK$1,200,000.  The Plaintiffs’ application is supported by the 1^st and 2^nd Affirmations of Lai Ying Louis, a solicitor of T K Tsui & Co, filed on 1 April 2021 and 10 May 2021 respectively.  It is responded to by the Defendant by the Affirmation of Lau Wing Chi Gigi, a partner of Ivan Tang & Co, filed on 3 May 2021.

8.  As can be seen from the 1^st Affirmation of Louis Lai, the Plaintiffs’ application is based on 3 grounds: (i) the Defendant is a permanent resident in Canada, (ii) the Defendant is impecunious, and (iii) the appeal is unmeritorious.

9.  By the Affirmation of Gigi Lau, the Defendant makes it clear that while she does not accept that the Plaintiffs have made out a case for security for costs, she wishes to focus on the substantive appeal without being bogged down by “interlocutory manoeuvres”, and undertakes to provide security for the Plaintiffs’ costs of the appeal in such sum as may be deemed fit by the court in the following manner:

(1)  Ivan Tang & Co, her solicitors, are prepared to give a “surety’s guarantee” in terms similar to that used in support of an application for the sealing of a foreign grant in Form No F.13 as security for the Plaintiff’s costs of the appeal; and

(2)  the Defendant’s son-in-law (“Lam”) agrees to charge his home in Canada (“the Canadian Property”), in which the Defendant and her daughter’s family are currently residing, in favour of Ivan Tang & Co if requested.

In that affirmation, it is also mentioned that the Canadian property was purchased in 2018 for about CAD 1.34 million, has a current market value of about CAD 1.7 million, and is subject to an outstanding mortgage debt of about CAD 774,000.  Gigi Lam has also exhibited a declaration made by Lam dated 2 May 2021 as “LWCG-6” to her affirmation, in which Lam states that he is prepared to charge the Canadian property in favour of Ivan Tang & Co up to the limit of CAD190,000[1].

10.  In the Defendant’s Submissions dated 26 May 2021, the Defendant’s proposal to provide security for costs by means of Ivan Tang & Co’s surety’s guarantee in favour of the Plaintiff, backed by Lam’s legal charge of the Canadian Property in favour of Ivan Tang & Co, is repeated.  A draft form of the proposed surety’s guarantee is annexed to the Defendant’s Submissions.

11.  The Plaintiffs do not accept the Defendant’s proposal, and insist that the security be given by payment into court of the sum of HK$1,200,000 as sought in the summons dated 1 April 2021.

DISCUSSION

12.  In the Defendant’s Submissions, she does not raise any substantive opposition to the Plaintiffs’ application for security for costs.  The Defendant also accepts that she is residing in Canada and cannot offer security by way of payment into court.  We are satisfied that the Plaintiffs are entitled, as a matter of principle, to security for costs of the appeal on the basis of the Defendant’s foreign residence, in the absence of any countervailing factor to militate against the prima facie rule that a foreign appellant ought to give security for costs of an appeal.  In the circumstances, we do not consider it necessary to consider the merits of the appeal.

13.  It is also not necessary to consider the suitability or sufficiency of the Canadian property as security, in view of the fact that it is not proposed by the Defendant to be charged in favour of the Plaintiffs.  In any event, in view of its nature and location, the Canadian Property is, in our view, not a suitable form of security for the Plaintiff’s costs of the appeal.  However, we do not see why the proposed surety’s guarantee by Ivan Tang & Co is objectionable as a form of security.  Louis Lai, in his 2^nd Affirmation, has not explained why a guarantee given by a firm of solicitors in Hong Kong is not acceptable to the Plaintiffs as security for their costs of the appeal, save to state (at §10) that “given the complicated [structure] behind the proposed surety, enforcement would be difficult and inevitably the Plaintiffs would be put to extra costs and unnecessary delay”.  Neither has Mr K M Chong, in his Skeleton Submissions dated 12 May 2021, explained why the proposed guarantee is not an acceptable form of security.  At §20 of his submissions, it is said that “Insofar as the surety’s guarantee … is concerned, it is submitted that Ps have difficulty understanding how it could fortify D’s proposed undertaking”, but the Plaintiffs’ alleged difficulty is not further explained.

14.  Mr Chong’s Reply Submissions dated 2 June 2021 are equally lacking in substance as to why the solicitor’s guarantee is not an acceptable form of security.  In those submissions, the following is said:

“[6] Despite it was stated in [Gigi Lau’s Affirmation] that D would undertake to provide security, it appears that D now only seeks this Court’s approval that the security be provided in the form of a ‘third party’ surety’s guarantee by Messrs. Ivan Tang & Co., i.e., D’s solicitors (‘the Guarantee’). For avoidance of doubt, neither D’s undertaking nor the Guarantee is acceptable to Ps, and Ps maintain that the security be provided by way of a payment into court.

[7] The draft Guarantee provides that Messrs. Ivan Tang & Co. would make full payment upon a 28 days’ notice from Ps (for which there is no justification for the lengthy period required of the notice). It is submitted that if such guarantee is taken seriously by D, one cannot see why D cannot make payment into court within 28 days of the order to be made herein. The Guarantee serves no useful purpose and would simply put Ps to extra costs and time for its enforcement, and complication is foreseeable if the Guarantee is dishonoured.

[11] As for the ‘surety’s guarantee’, no explanation as to how Mr. Lam’s landed property could be utilized to fortify D’s undertaking was forthcoming, and not even a draft of the said guarantee was provided. Unsurprisingly, nothing was mentioned in the draft Guarantee in that regard.

[12] Despite that D was given the opportunity to address Ps’ concerns, she offered no explanation but wrongfully sought to place the burden of objection on Ps.  It is submitted that D’s proposed forms of security are not justified at all, and hence, they should be rejected outright.”

15.  Other than the objection relating to the time for payment (28 days upon demand in writing) under the surety’s guarantee proposed to be given by Ivan Tang & Co, none of the matters mentioned in the Reply Submissions seems to us to raise any concern of substance about the proposed surety’s guarantee as security for the Plaintiffs’ costs.  The amount of the security sought by the Plaintiff (HK$1.2 million) is not a huge sum of money.  There is no reason to believe that Ivan Tang & Co will not be able to honour the guarantee should they be called upon to do so.  We also consider the time for payment under the proposed surety’s guarantee, ie 28 days upon the Plaintiffs’ demand in writing, to be reasonable in all the circumstances.

16.  Under Order 59, r 10(5) of the Rules of the High Court, the form of security for the costs of an appeal, where it is considered that security ought to be given, is a matter to be determined by the court in the exercise of its discretion.  An order for security for costs should aim to provide reasonable, but not absolute, protection of the costs of a party which the court considers should be given by the other party.  We are of the view that the proposed surety’s guarantee by Ivan Tang & Co to be sufficient and appropriate for the Plaintiffs’ costs of the appeal.

17.  As for the amount of the security, we have considered the Plaintiffs’ Skeleton Bill of Costs.  The total estimated costs come to HK$1,285,425, the bulk of which relates to counsel’s fees (HK$750,000 and HK$350,000 for leading and junior counsel respectively).  In view of the fact that counsel also appeared at the trial before Wilson Chan J and ought to be thoroughly familiar with the legal and factual issues in the case, and the fact that the grounds raised in the Defendant’s Notice of Appeal dated 11 January 2021 and the Plaintiffs’ Respondent’s Notice dated 1 February 2021 are, we consider, straight forward, we consider the estimated counsel’s fees to be on the high side.  We fix the amount of the security at HK$800,000.

18.  In relation to the costs of the application, we note that there are some “without prejudice correspondence” in sealed envelopes included in the hearing bundle, which we believe may have some bearing on the issue of costs.  In the circumstances, we make an order nisi that the costs of the application be in the cause of the appeal, save that any application to vary the order nisi may only be made on the basis of matters disclosed in the “without prejudice correspondence”.

DISPOSITION

19.  The court makes the following order:

(1)  The Defendant (Appellant) shall within 28 days from the date of the order herein give security for the Plaintiffs (Respondents)’ costs of this appeal in the sum of HK$800,000 by providing a surety’s guarantee by Ivan Tang & Co in the form of the draft annexed to the Defendant’s Submissions dated 26 May 2021.

(2)  Until such surety’s guarantee be provided and notice thereof given by the Defendant to the Registrar of Civil Appeal, all proceedings in the appeal herein be stayed.

(3)  In default of providing such surety’s guarantee within the time aforesaid, the said appeal, upon the solicitors for the Plaintiffs certifying such default to the Registrar of Civil Appeal, do stand dismissed without further order of the court with costs to be paid by the Defendant to the Plaintiffs, such costs to be taxed if not agreed.

(4)  There be an order nisi that the costs of Plaintiffs’ application for security for costs by summons dated 1 April 2021 be in the cause of the appeal.

(5)  Liberty to apply.