ACLS v. HSBTL

HCMP 1937/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 1937 OF 2011

(ON AN INTENDED APPEAL FROM FCMP NO. 270 OF 2010)

---------------------------

BETWEEN

---------------------------

_______________

DECISION

_______________

Hon Yeung V-P:

1.  I agree with the judgment of Kwan JA and endorse the order she proposes in paras 29 and 30. I also agree with her view on the need to assist the Court in a paper application for leave to appeal to the Court of Appeal.

Hon Kwan JA:

2.  This is an application for leave to appeal to the Court of Appeal from an order made by HH Judge C.K. Chan in FCMP 270/2010 on 19 July 2011 in the exercise of his case management powers. This application is dealt with by the Court of Appeal on the basis of written submissions only without a hearing. It is without merit and should not have been made.

The background

3.  The background matters leading to the order made on 19 July 2011 are taken from the decision of the Judge on 21 September 2011 in refusing leave to appeal to the Court of Appeal and are as follows.

4.  AKT (“the deceased”) was the paternal grandfather of the plaintiff, Ms ACLS. He had passed away on 7 July 2009, having accumulated very substantial wealth in his lifetime. He left two sons and a daughter. The elder son, AWL has two children and one of them is the plaintiff. AWL is involved in the present proceedings not as a party but as the solicitor for the plaintiff. The younger son is AYL. He is the 1^st intervener in the present proceedings. The wife of AYL, Madam CPC, and their son AC are the 3^rd and 4^th interveners in these proceedings. The deceased’s widow and the plaintiff’s paternal grandmother, Mrs ALSH, is the 2^nd intervener. The defendant, HSBTL, is the administrator pendente lite of the estate of the deceased. The defendant has adopted a neutral stance in the proceedings throughout.

5.  The plaintiff was and is a full time university student in England since September 2009. According to her, the deceased had promised to and did in fact provide financial assistance to support her overseas education. That assistance was no longer available after his death. The plaintiff regards herself as a dependant of the deceased during his lifetime and the disposition of his estate by the will of the deceased dated 5 September 2008 (one of the two wills under dispute in HCAP 7/2010 and HCAP 9/2010) is not such as to make reasonable financial provision for her. She seeks maintenance from his estate to continue her studies in England.

6.  On 31 December 2010, the plaintiff issued the originating summons in FCMP 270/2010 asking for the respective sums of HK$28,200 and £37,888.10 from the deceased’s estate under sections 4 and 7 of the Inheritance (Provision for Family and Dependants) Ordinance, Cap. 481 (“the Ordinance”). On 16 June 2011, the Judge granted leave for the 1^st to 4^th interveners to be joined in this action and gave directions for the interveners to file evidence in opposition and the plaintiff to file evidence in reply. He adjourned the originating summons to 19 July 2011 for a third directions hearing scheduled to last for 30 minutes.

7.  On 13 July 2011, the 2^nd to 4^th interveners issued a summons returnable on 19 July 2011 to strike out the originating summons on the ground that it discloses no reasonable cause of action, it is frivolous or vexatious, and/or it is an abuse of the process of the court. The strike out summons has the support of the 1^st intervener. The defendant maintains a neutral stance.

The subject order of the intended appeal

8.  At the directions hearing on 19 July 2011, the Judge made the following order on the strike out summons, which is the subject of the intended appeal of the 2^nd to 4^th interveners:

(1) the trial of the plaintiff’s originating summons and the 2^nd to 4^th interveners’ summons to strike out the originating summons be adjourned for a full trial on 3 January 2012 at 10:30 a.m. until 6 January 2012 for four days; and

(2) the plaintiff and her witness and the 1^st to 4^th interveners are to attend court for cross-examination.

9.  The Judge did not give a reasoned decision when he made the above order adjourning the strike out application to be heard with the substantive trial of the originating summons. The order was made in the course of the exchanges the Judge had with counsel for various parties, during which he ascertained the intention of the parties if the deponents of the affidavits filed would be called to testify, if these deponents would be cross-examined, the estimated length of the hearing of the strike out application and of the originating summons. As a result of these exchanges, the Judge indicated to the parties that he would not accede to the request of counsel for the 2^nd to 4^th interveners (supported by counsel for the 1^st intervener) to fix a separate hearing for the strike out application prior to the full hearing of the originating summons. 

10.  The Judge explained his reasons for the above order in his decision handed down on 21 September 2011, when he refused leave of the 2^nd to 4^th interveners to appeal to the Court of Appeal. He also dismissed the summons of these interveners issued on 15 September 2011 for a stay of the subject order of 19 July.

The grounds of the intended appeal

11.  The submissions for leave to appeal made to this court are basically the same as the submissions made to the Judge. It was contended on behalf of the 2^nd to 4^th interveners that the purpose of the strike out application is to dispose of the plaintiff’s claim with minimal time and costs by inviting the court to make a summary decision. If the court considers the application inappropriate, the court should dismiss the application instead of adjourning it to be heard with the trial of the originating summons. It was submitted that the subject order of 19 July is in effect a denial of the chance of the 2^nd to 4^th interveners to be heard on their strike out application and that they were deprived of the opportunity to have the originating summons disposed of summarily in a more economical manner.

12.  It was further argued that the Judge had erred in failing to consider the objectives of the Civil Justice Reform (“CJR”) set out in Order 1A rule 1 of the Rules of the District Court. It was contended that a separate hearing of the strike out application for, say, two to three hours would be more in keeping with the said objectives in terms of increasing cost-effectiveness, ensuring expeditious disposal of the case, promoting a sense of reasonable proportion and procedural economy in the conduct of proceeding, ensuring fairness between the parties, facilitating the settlement of disputes, and ensuring fair distribution of the resources of the court. Counsel submitted that as there has not been any authority on the circumstances under which a strike out application may be heard with the trial of the action itself, this would be a proper case for the Court of Appeal to set a precedent under the CJR.

The Judge’s reasons for making the order

13.  The Judge first noted that the plaintiff’s claim in the originating summons is relatively small, compared to the size of the deceased’s estate. He is of the view that the case should proceed as expeditiously as possible.

14.  At the second call-over hearing on 16 June 2011, the Judge had granted orders for the joining of all necessary parties and given directions for the filing of affidavits. When the case came before him for the third call-over hearing on 19 July 2011, the Judge was of the view that the case is ready and should be set down for trial without further delay.

15.  Although the 2^nd to 4^th interveners had issued a strike out application a few days prior to the call-over hearing on 19 July 2011, the Judge saw no point in adjourning that application for another argument if the case is ready for a full trial. Although the time required for argument on the strike out application would certainly be shorter than the trial of the main action, the Judge was sceptical if it would be only two to three hours as estimated by counsel. The Judge was of the view that a full day would be required, bearing in mind that in the Family Court, argument can only start at 10:30 a.m. instead of at 9:30 a.m. as in the other courts.

16.  Furthermore, the state of the Judge’s case diary at the time of the call-over hearing on 19 July 2011 was that the next available date for a one-day hearing before him would be some time in November or December 2011. The Judge was of the view that if the court’s diary would allow the trial of the originating summons to be conducted in early January 2012 for four days, he did not see why the court should waste further time in hearing an interlocutory argument, which might or might not be able to bring the case to a conclusion.

17.  The Judge observed that to be fair to counsel for the 2^nd to 4^th interveners, counsel was right in saying that there is not much point in hearing the strike out application if it is to be heard with the trial of the originating summons and the Judge should have dismissed it right away. The Judge agreed that with hindsight, he could have been more robust in dismissing the application right away, and this is exactly what he is going to do on 3 January 2012 when the case comes before him for a final hearing.

18.  Lastly, the Judge noted that in considering whether to allow an interlocutory argument for striking out to proceed when the case was ready for a full trial, he was exercising his case management power, which would not be lightly disturbed on appeal unless he is plainly wrong. He did not think there is reasonable prospect of success in overturning this case management decision on appeal. Hence, leave to appeal was refused.

The views of this court

19.  I am in full agreement with the Judge’s reasons why the strike out application should not be adjourned for substantive argument prior to the trial of the main action and his reasons for refusing leave to appeal. I would add the following reasons.

20.  Counsel for 2^nd to 4^th interveners had submitted that the originating summons should be struck out because the plaintiff has failed to establish that she has locus standi to apply or that she is entitled to any maintenance from the estate of the deceased and her application is doomed to failure. The argument is along these lines.

21.  As a grandchild of the deceased, the plaintiff can only rely on section 3(1)(ix) of the Ordinance to apply for financial provision out of the estate. This subsection provides that “any person … who immediately before the death of the deceased was being maintained, either wholly or substantially, by the deceased, … may apply to the court for an order under section 4 on the ground that the disposition of the deceased’s estate effected by his will or the law relating to intestacy, or the combination of his will and that law, is not such as to make reasonable financial provision for the applicant.”

22.  Counsel for the 2^nd to 4^th interveners contended in his written submission that the plaintiff has failed to establish she would come within this subsection as a matter of law and as a matter of evidence.

23.  As a matter of law, it was argued that by reason of the use of the words “being maintained” and “reasonable financial provision” in section 3(1)(ix), this subsection: (1) would only cover the costs of daily living and not education expenses; and (2) would only cover expenses and financial needs in the foreseeable future and not the reimbursement of expenses already incurred. It was further contended that notwithstanding the plaintiff is receiving full-time education, as she is an adult capable of earning her own living, the court would order financial provision out of the estate only in exceptional circumstances.

24.  In support of the above contentions, counsel cited Re Dennis (deceased) [1981] 2 All ER 140 at 145g to 146b; Re Abram (deceased) [1996] 2 FLR 379 at 396C to E; In re Jennings, deceased [1994] Ch 286 at 295E to G.

25.  As a matter of evidence, it was contended that the plaintiff has failed to adduce evidence to establish that she “was being maintained, either wholly or substantially, by the deceased”. The plaintiff deposed that since 2002, the deceased had been supporting her family by paying the mortgage repayments of a property of about HK$30,000 a month, the family expenses of HK$30,000 a month, and the education costs of the plaintiff and her brother until immediately before the deceased’s death. The interveners disputed this and have alleged that the plaintiff has been supported financially by her parents, not by the deceased. They also disputed the plaintiff’s claim that the deceased had promised to give her financial support for her education overseas.

26.  It is not necessary to express a view on the arguments of law except to say that it is just not plain and obvious that maintenance and financial provision for the purpose of section 3(1)(ix) would not cover education expenses that had been incurred or are to be incurred. The cases cited by the interveners’ counsel are not direct authorities in support as those cases are concerned with different fact situations. It is also instructive to note the following dicta:

“What is proper maintenance must … depend upon all the facts and circumstances of the particular case being considered at the time, but I think it is clear on the one hand that one must not put too limited a meaning on it; it does not mean just enough to enable a person to get by; on the other hand, it does not mean anything which may be regarded as reasonably desirable for his general benefit or welfare.” (Re Coventry, deceased [1980] Ch 461 at 485C, per Goff LJ)

“The court has, up until now, declined to define the exact meaning of the word ‘maintenance’ and I am certainly not going to depart from that approach. But in my judgment the word ‘maintenance’ connotes only payments which, directly or indirectly, enable the applicant in the future to discharge the cost of his daily living at whatever standard of living is appropriate to him. The provision that is to be made is to meet recurring expenses, being expenses of living of an income nature. … Nor am I suggesting that there may not be cases in which payment of existing debts may not be appropriate as a maintenance payment; for example, to pay the debts of an applicant in order to enable him to continue to carry on a profit-making business or profession may well be for his maintenance.” (Re Dennis (deceased), supra. at 145h to 146a, per Browne-Wilkinson J)

27.  As for the dispute on the affidavit evidence, it does not seem to me this could be resolved without hearing oral testimony.

28.  The Judge is right in refusing to be distracted by the strike out application, which is wholly inappropriate, and is nothing more than a delaying tactic of the interveners, as are their application for leave to appeal to the Court of Appeal, and their equally ill conceived application issued on 12 December 2011 seeking the recusal of the Judge on the ground of apparent bias. 

29.  For the above reasons, I would dismiss the application for leave to appeal to the Court of Appeal. As this application is wholly without merit, I would make an order under Order 59 rule 2A(8) of the Rules of the High Court that no party may under rule 2A(7) request the determination to be reconsidered at an oral hearing inter partes.

30.  I would make an order nisi that the 2^nd to 4^th interveners are to pay the plaintiff’s costs of this application. For the purpose of making a gross sum assessment, I would direct the plaintiff to submit a skeleton bill within 14 days hereof and the 2^nd to 4^th interveners do have leave to respond within 7 days thereafter.

The preparation of bundles

31.  I cannot leave this application without saying a word about the papers placed before this court.

32.  There have been an increasing number of applications for leave to appeal to the Court of Appeal. Typically, the Court of Appeal would only be provided with the judgment below, the summons for leave, the statement in support by the applicant, and occasionally the statement in opposition by the respondent. In most instances, these papers are quite simply insufficient for the court to form a view on the merits of the application and on the appropriate way of dealing with the application, whether a hearing should be held or whether it could be dealt with on paper. Very often, the Court of Appeal would have to call for the case file from the court below to gain a better understanding and to go through the case file to locate relevant documents. Needless to say, this is unsatisfactory. It causes delay in disposing of the application, and adds to the workload of the court.

33.  The time taken for the disposal of the present application bears out just how unsatisfactory things can be. When the papers reached the Court of Appeal on 19 October 2011, only the transcript of the hearing on 19 July 2011 was included in the papers. That was not of much assistance to the court as the transcript did not contain the reasons of the Judge in making the order under appeal. The case file could not be despatched to the Court of Appeal, as it was needed for the subsequent recusal application issued by the interveners. The file did not reach this court until 20 December 2011. It was left to this court to sift through the papers and locate what is relevant. In this case, the Judge’s reasons were clearly and adequately set out in his decision handed down on 21 September 2011 refusing leave to appeal. But no one saw fit to draw this court’s attention to it.

34.  Parties who are legally represented should render assistance to this court and put together a bundle of the relevant documents filed in the proceedings below for the use of this court when they file their statement in support. Much time and effort would be saved if it is not necessary for the case file to be called from the court below, or for this court to rummage through the case file in an attempt to locate relevant documents.