LI JINPEI also spelt as LAI KAM PUI also known as AU KAM PUI v. AU KAM SUN

HCMP 2641/2012

[2018] HKCFI 1695

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 2641 OF 2012

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J U D G M E N T

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INTRODUCTION

1.  The principal issue to be determined in this action is whether the Plaintiff is a validly adopted son of Mr Au Yuet Sum (“Mr Au”) and Madam Lai Ying (“Madam Lai”), both deceased.

BASIC FACTS

2.  Mr Au and Madam Lai were husband and wife.  They were both of Chinese origin and came to reside in Hong Kong in the 1930s.  They had no children of their own.

3.  Mr Lai Ming Sing (“Mr Lai”) was the younger brother of Madam Lai.  Mr Lai and Madam Chen Xiuzhi (“Madam Chen”) were husband and wife, and residents in the Mainland.

4.  The Plaintiff is the natural son of Mr Lai and Madam Chen, and claims to be the adopted son of Mr Au and Madam Lai pursuant to an adoption agreement made in 1971 in the Mainland.  I shall come back to the Plaintiff’s adoption later in this judgment.

5.  Mr Au died intestate on 24 July 1992 leaving, inter alia, 5 properties in Hong Kong, referred to in the Statement of Claim as “Property A”, “Property B”, “Property C”, “Property D” and “Property E” respectively (collectively the “5 Properties”).  Letters of administration of the estate of Mr Au were granted to Madam Lai on 4 September 1994.

6.  Madam Lai passed away on 6 November 2004, leaving a will dated 5 November 1999 (“the Will”).  The Defendant and one Mr Au Keung Sun are the named executors of the Will.  Probate of the Will was granted to the Defendant on 5 December 2007.  Under the Will, Properties D and E were bequeathed to the Plaintiff and Mr Lai Ping Kai (the Plaintiff’s younger brother) as tenants in common in equal shares.

7.  By the time of her death, Madam Lai had not yet completed the administration of the estate of Mr Au.  On 25 November 2010, Letters of Administration de bonis non of the estate of Mr Au (“the Grant”) were granted to the Defendant.

8.  It is not in dispute that the Defendant sold the 5 Properties in 2011:-

(1)  Properties A, B and C were sold for HK$775,000, HK$1,200,000 and HK$1,400,000 respectively.  The total sale proceeds came to HK$3,375,000.  The Defendant has not paid any part of the sale proceeds to the Plaintiff.

(2)  According to the Defendant, the net sale proceeds of Properties D and E came to HK$4,294,363.75, and the Plaintiff and Mr Lai Ping Kai were entitled to one half of that sum, ie HK$2,147,181.88 (because, on the Defendant’s case, Madam Lai was only entitled to half of the residuary estate of Mr Au, with the remaining half belonging to two elder brothers of Mr Au).  It is common ground that the Defendant in fact paid the sum of HK$3,294,363 to the Plaintiff and Mr Lai Ping Kai on 5 December 2011. The Defendant says that the excess was paid by mistake.

THE PRESENT ACTION

9.  As earlier mentioned, it is the Plaintiff’s case that he is the adopted son of Mr Au.  If the Plaintiff’s claim to be the adopted son of Mr Au can be established and his adoption satisfies the conditions set out in Section 17(2) of the Adoption Ordinance, Cap 290 (the “AO”), he shall be treated as a “child” of Mr Au for the purpose of the Intestates Estates Ordinance, Cap 73 (the “IEO”) and, subject to the statutory legacy of HK$500,000 in favour of Madam Lai, he shall be entitled to one half of the residuary estate of Mr Au under Section 4(3)(b) of the IEO.

10.  Pausing here, I should mention that the Defendant alleged that Mr Au and Madam Lai had two other adopted children, namely, Madam Au Kit Ling (歐潔玲) and Mr Au Kam Sun (歐鑑新)[1]. Each made a witness statement to that effect, but neither attended the trial or gave evidence at the trial.  On the state of the evidence before the court, I am unable to find that Madam Au Kit Ling (歐潔玲) and Mr Au Kam Sun (歐鑑新) are the adopted children of Mr Au and Madam Lai.

11.  On 20 November 2012, the Plaintiff commenced the present action by way of an Originating Summons seeking, inter alia, the following relief: (i) the Grant be revoked; (ii) the Plaintiff as the adopted son of Mr Au be appointed as administrator of the un-administered estate of Mr Au, and (iii) the Defendant do render a just and true account of the un-administered estate of Mr Au.

12.  Pursuant to the order of Master Levy dated 27 June 2013, the present action was converted into a probate action.

13.  The Plaintiff filed his Statement of Claim on 7 August 2013 seeking essentially the same relief mentioned in the Originating Summons.  In the Defendant’s Amended Defence filed on 27 June 2014, the Defendant disputed the claimed status of the Plaintiff as the adopted son of Mr Au.

14.  On 22 January 2018, the Defendant applied to re-amend the Amended Defence in order to raise a limitation defence.  The application to amend was dismissed by the court with costs to the Plaintiff on 8 June 2018.  Up until that time, the Defendant was represented by solicitors and counsel in this action.  On 15 June 2018, the Defendant filed a Notice of Intention to Act in Person.

15.  The Defendant did not appear at the trial of this action.

THE PLAINTIFF IS A VALIDLY ADOPTED SON OF MR AU AND MADAM LAI

16.  The Plaintiff was born in the Mainland on 10 March 1967, and was about 4 years old in 1971.  His knowledge of his adoption by Mr Au and Madam Lai is based on what he was told by his natural parents. Madam Chen, the Plaintiff’s natural mother, made an affirmation dated 7 May 2013 and a witness statement dated 31 December 2016 confirming the adoption of the Plaintiff by Mr Au and Madam Lai in 1971.  She gave oral evidence at the trial to confirm the same.  There is also in evidence before the court two statutory declarations dated 28 April 1986 and 18 July 1986 respectively made by Mr Au.  In his first statutory declaration, Mr Au referred to the Plaintiff as his “son”.  In his second statutory declaratory, Mr Au stated that the Plaintiff was his “adopted son”.  The Plaintiff has also produced a Notarial Certificate issued by the Notary Office, Luoding City, Guangdong Province, the People’s Republic of China, dated 3 June 1986, as well as certified true copies of the documents kept in an internal file of the Notary Office showing the investigations carried out before the issue of the Notarial Certificate. In the Notarial Certificate, it is stated that the Plaintiff was adopted by Mr Au and Madam Lai as their son from Mr Lai and Madam Chen on 26 February 1971.

17.  Under PRC law, a notary’s duties include verification of a relationship based on an adoption (see Clause 4(4) of Chapter 2 of 中華人民共和國公証暫行條例 dated 13 April 1982), and a notarial certificate constitutes prima facie evidence of the validity of an adoption referred to in it (see 最高人民法院關於辦理過繼和收養關係公證的通知dated 5 June 1979, and Clause 36 of Chapter 5 of中華人民共和國公證法 dated 28 August 2005).

18.  Madam Wen Luo, a PRC law expert, gave evidence at the trial to prove the validity of the adoption of the Plaintiff by Mr Au and Madam Lai.  She also explained that, under PRC law, Mr Au and Madam Lai would, upon the adoption, assume the rights and responsibilities of the Plaintiff’s natural parents with respect to the Plaintiff, and the natural parents’ rights and responsibilities would come to an end.

19.  On the evidence before the court, I find that the Plaintiff was validly adopted by Mr Au and Madam Lai as their son in Mainland China in or about 1971, and the adoption satisfies the conditions set out in Section 17(2) of the AO.  It follows that the Plaintiff should be regarded as an “issue” of the Mr Au for the purpose of the IEO.

20.  Given this finding, it is clear that the Plaintiff has a better right than the Defendant to be granted letters of administration de bonis non of the estate of Mr Au (see Williams, Mortimer and Sunnucks on Executors, Administrators & Probate, 21^st Edn, at paragraph 20-04).  The Grant ought not to have been made, and should be revoked under Section 33(1) of the Probate and Administration Ordinance, Cap 10.

21.  In passing, I should mention that in the Amended Defence, at paragraph 22(d)(iii), the Defendant alleges that, by reason of the fact that the Plaintiff continued to live with his natural parents (ie Mr Lai and Madam Chan) after the adoption in 1971 and treated them as his parents, a situation of “de facto adoption” arose between the Plaintiff and his natural parents thereby invalidating the adoption of the Plaintiff by Mr Au and Madam Lai.  I accept the evidence of Madam Wen Luo that there is no proper legal basis for this contention under PRC law, and the same is rejected.

INTERIM PAYMENT

22.  On behalf of the Plaintiff, Mr Chain submits that, given the unavailability of the Defendant and the time that it would take for the taking of the estate account, the court should order the Defendant to pay to the Plaintiff half of the proceeds of sale of the 5 Properties less the amount already received by the Plaintiff which he is entitled to as a beneficiary of the residuary estate of Mr Au.  In this regard, I have been told by Mr Chain that Madam Lai’s statutory legacy of HK$500,000 has already been satisfied from the cash available in the estate of Mr Au.

23.  On the footing that the Plaintiff and Madam Lai (or her estate) are the only two beneficiaries of the residuary estate of Mr Au in equal shares, the Plaintiff should prima facie be entitled to 50% of the sale proceeds of Properties A, B and C, ie HK$1,687,500.  In relation to Properties D and E, taking into account the fact that (i) the Plaintiff has already received a portion of the proceeds of sale of those properties, (ii) Mr Lai Ping Kai also has an interest in the sale proceeds, and (iii) there is, I understand, an outstanding issue as to the nature of the sum of HK$1,000,000 referred to as “Security money for Fire Directions” deducted out of the sale proceeds, I do not consider it appropriate at this stage to order the Defendant to pay any further sum to the Plaintiff pending the taking of the estate account.

DISPOSITION

24.  For the foregoing reasons, I order that:-

(1)  the Grant shall be revoked with immediate effect;

(2)  the Defendant shall lodge the Grant with the Probate Registry within 14 days of the date of this judgment if he has not already done so;

(3)  the Plaintiff shall be appointed as administrator of the estate of Mr Au;

(4)  the Defendant shall render a just and true account of the estate of Mr Au, as well as his administration thereof, within 56 days of the date of this judgment;

(5)  the Defendant shall pay the sum of HK$1,687,500 to the Plaintiff by way of interim payment within 14 days of the date of this judgment pending the taking of the account under (4) above; and

(6)  the Defendant shall pay the Plaintiff’s costs of this action, including all reserved costs (if any), to be taxed if not agreed.