CHAN SAU WAI SHIRLEY v. JEN KIT JOSEPHINE, the administratrix of the estate of the Deceased AND ANOTHER

HCAP 25/2019

[2024] HKCFI 3479

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PROBATE ACTION NO 25 OF 2019

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D E C I S I O N

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1.  I make the following orders:

“UPON the undertaking by the Plaintiff that:

(1) she shall pay the sum of HKD150,000 in 14 days hereof to Mr. WONG Tak Shing (“Mr. Wong”) in his capacity of the designated independent and professional administrator (“IPA”);

(2) the said sum shall be used for and only for the fees and expenses etc. incurred by Mr. Wong for the purpose of obtaining the grant of letters of administration of the Estate and, upon grant, for the purpose of receiving and reviewing the account to be served and the assets, if any, to be delivered to him by the 1^st Defendant and for the purpose of reporting to the parties herein about the said account and assets;

(3) the said payment shall be reimbursed by the assets of the Estate (if any) in due course subject to any laws that maybe applicable thereto;

IT IS HEREBY ORDERED that:

(1) Subject to filing of the requisite papers and compliance with the requirements of the Probate Registry, a fresh grant of letters of administration of the Estate be granted to Mr. Wong;

(2) In 28 days hereof, the 1^st Defendant do:

(a) file and serve on the Plaintiff and Mr. Wong a signed true and just account of the assets (and properties) comprising the Estate;

(b) deliver and transfer to Mr. Wong all the assets (and properties) belonging to the Estate which have been collected and/or received by the 1^st Defendant in her capacity as the administratrix of the Estate.

(3) If the assets of the Estate are insufficient to pay for any further fees and expenses etc. that Mr. Wong may incur as the IPA, any party hereto is at liberty to pay Mr. Wong (as the IPA) accordingly if the said part(ies) request(s) Mr. Wong to investigate any potential claim, commence or continue any legal proceedings or otherwise act on behalf of the Estate;

(4) The said payment(s) shall be reimbursed by the assets of the Estate (if any) in due course subject to any laws that maybe applicable thereto;

(5) The fees for Mr. Wong shall be charged at HKD4,000 per hour;

(6) Liberty to apply; and

(7) Costs of this hearing be paid by the 1^st and 2^nd Defendants personally to the Plaintiff, with certificate for one counsel only (Mr David WK Tang).”

2.  By her judgment given on 15 July 2024 at [2024] HKCFI 1811, Madam Justice B Chu directed that there be a hearing to deal with two matters.  First, the identity of the independent professional administrator. Second, the payment of the administrator’s charges. 

“Consequential directions” sought by the defendants

3.  It is plain to me that the trial judge did not intend that any further directions in relation to the administration of the estate be dealt with in this directions hearing.  In light of the clear direction of the trial judge, I consider that the proposals made by the defendants by their solicitors’ letter dated 5 August 2024, which proposals are maintained at today’s hearing, seeking “consequential directions” ought not to have been made in the first place. 

4.  Those directions are wide-ranging and extensive. They cover, for instance, directions in relation to all ongoing legal proceedings and, further, a direction that the administrator be empowered to commence fresh proceedings against any wrongdoer, if so advised. 

5.  In any event, these matters are matters for the independent professional administrator to deal with.  I do not see how and why the court can grant those directions at this stage.  It is for the administrator to seek the directions as he sees fit. 

The identity of the independent professional administrator

6.  As to the identity of the independent professional administrator, the defendants have not nominated any candidate.  I approve the candidate nominated by the plaintiff. 

The payment of the administrator’s charges

7.  As to the payment of the administrator’s charges, the defendants ask the court to direct that the plaintiff should pay into court a sum of $5 million to fund the administration of the estate.  That suggestion must be rejected.  The defendants have not demonstrated the legal basis of any jurisdiction under which the court has the power to compel a beneficiary to fund the costs of the estate against his wish. 

8.  The authorities cited by the defendants are about the court’s power to authorise the trustees to be remunerated.  They are not about who should be funding the estate or its administration when the estate has no assets. 

9.  In any event, even if the court has the jurisdiction to do so, there is no reason why the plaintiff should be compelled to do so. 

10.  On the other hand, I consider that the plaintiff’s proposal on the payment issue to be reasonable. 

Costs of this hearing

11.  As for costs, I accept the plaintiff’s submission that this directions hearing is, in principle, an extension of the trial.  This is because the identity of the independent professional administrator and how he should be paid were issues that had been disclosed in the pleadings in the action.  In relation to the identity of the independent professional administrator, that was an issue to be adjudicated at the trial. See para 43, C.2.5 of the judgment. 

12.  I, therefore, agree that the costs order made at the trial should apply equally to the costs of today’s hearing. 

13.  In any event, even if today’s hearing is to be looked at on its own, I consider that the stance adopted by the defendants on the second issue is unreasonable, if not absurd. 

14.  Furthermore, up to this hearing, the defendants have persisted in reciting their opposition mounted at the trial that no independent professional administrator should be appointed.  It is unhelpful and counterproductive for the defendants to maintain that stance in this directions hearing.  Their position had already been rejected by the trial judge.  From that point onwards, parties should proceed on the basis that an independent professional administrator is to be put in place.  There is no point in harking back to the defendants’ position at trial. 

15.  I consider that the defendants have acted unreasonably in relation to the two matters which need to be dealt with today. Therefore, they should personally be liable for the costs of today’s hearing.