LIANG PUI SAW KIAN AND ANOTHER v. LEUNG YUK CHUN AND ANOTHER

HCMP 130/2016

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 130 of 2016

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J U D G M E N T

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Background

1.  The late Mr Tsui Man Hing (“Mr Tsui”) died on 2 November 1996, having made a will on 10 April 1992.  These proceedings concern the interpretation of certain clauses of the will.  The central question will be whether or not an appropriation has been made to meet certain legacies, and if so, the consequences of that appropriation.  For convenience in this judgment I will refer to Mr Tsui’s five sons by their English Christian names.

2.  The Will contains the following relevant clauses:

“3

(a) (a usual provision for the payment of debts duty and expenses)

(b) UPON TRUST to hold the residue of my estate and apply the profits thereof and income therefrom for the following purposes during the first 10 years of my death, namely:

(i) as to 30% thereof for the maintenance of Madam CHOW (or CHAU) FUNG LIN (周 鳳蓮) and Madam YUEN YIM NGAN (袁 艷顏) and Madam LEUNG YUK CHUN (梁 玉珍) and also for meeting the expenses to be incurred in connection with the annual family reunions as hereinafter provided;

(ii) As to 10% thereof for the maintenance of my son the said TSUI WAI HO (James) (徐 偉 豪);

(iii) As to 10% thereof for the maintenance of my son the said TSUI WAI KIT (Michael) (徐 偉 杰);

(iv) As to 10% thereof for the maintenance of my son the said TSUI WAI FU (Eric) (徐 偉 富);

(v) As to 10% off the maintenance of my son said TSUI WAI KEUNG (Bernard) (徐 偉 強);

(vi) As to 30% thereof for the maintenance of my son the said ALBERT TSUI WAI CHAU (徐 偉 袖).

4. I direct as follows:‑

(a) In apportioning the amount for the purposes specified in clause 3(b)(i) hereof, the said ALBERT TSUI WAI CHAU shall have absolute discretion and his decision shall be final and conclusive.

(b) (this clause made provision for air passages and allowances for annual family reunions).

5. At the expiration of 10 years after my death, my Trustees shall hold and stand possessed of the residue of my estate upon the following trusts: namely:‑

(a) UPON TRUST to apply the income derived from 30% thereof for the purposes specified in clause 3(b)(i) hereof Provided that upon the deaths of the said CHOW (or CHAU) FUNG LIN, YUEN YIM NGAN and LEUNG YUK CHUN, my Trustees shall hold the same for my said five sons named in clause 3 (b) hereof for their own use and benefit absolutely as tenants in common in equal shares.

(b) UPON TRUST to hold 10% thereof for the said (James Tsui) for his own use and benefit absolutely;

(c) UPON TRUST to hold 10% thereof for the said (Michael Tsui) for his own use and benefit absolutely;

(d) UPON TRUST to hold 10% thereof for the said (Eric Tsui) for his own use and benefit absolutely;

(e) UPON TRUST to hold 10% thereof for the said (Bernard Tsui) for his own use and benefit absolutely;

(f) UPON TRUST to hold 30% thereof for the said (Albert Tsui) for his own use and benefit absolutely.”

3.  Madam Chow Fung Lin had predeceased the late Mr Tsui.  Exercising his powers under clause 4(a) of the will, on 29 January 2008, Albert determined that no provision by way of apportionment should be made for Madam Leung Yuk Chin under clause 3(b)(i) of the will.  That decision was confirmed by an order of the court on the same day.  The order was served on Madam Leung, who took no steps then or thereafter to challenge the determination or the order.

4.  The fact of Madam Chow having predeceased the late Mr Tsui, and Albert’s determination in respect of Madam Leung, meant that the only life tenant requiring provision under the will was Madam Yuen Yim Ngan, Albert’s mother.

5.  At the same time as he made the determination in respect of Madam Leung, Albert exercised his discretion to determine that payment should be made to Madam Yuen for her maintenance at the rate of $20,000 per month.  He gave an indemnity to the estate for the sum of $5 million, should his mother’s entitlement be less than those payments.  At that time Madam Yuen occupied a flat in Mirador Mansion, Nathan Road, Kowloon, owned by the estate, as her residence.  She continued to occupy that flat until her death.

The scheme of the will

6.  The scheme of the will is quite clear.  The testator intended that his children should share unequally in his estate, with Albert receiving a greater share.

7.  It is necessary to look carefully at the percentages allocated in order to determine how the share of each residuary legatee, (the five brothers), was to be assessed on distribution. 

8.  The use of the expression “thereof” wherever it appears in clause 5 must refer to the expression “the residue of my estate” in the opening words of clause 5.  Thus the percentages allocated throughout clause 5 are percentages of the whole of the estate.  That is the only way in which the percentages allocated can be explained.  The percentages clause in 5(a) – (f), which describe the distribution of the whole of the residue, add up to 100%.  Consequently, in each subclause, the percentage referred to must refer to a percentage of the whole of the residue.

9.  As will be seen, prior to the expiration of the 10 year period agreement was reached that 70% of the estate should be realised and distributed to the residuary beneficiaries pursuant to the provisions of clause 5(b) – (f).  Thus, it would have been necessary for the Administratrices, when making that distribution, to have assessed the sums distributed to each of the brothers pursuant to clause 5(b) – (f) against the value of the whole of the residue, not merely the proceeds of the particular sales.  There is no suggestion that this course had not been followed.

10.  The will plainly contemplated that 30% of the estate could be set aside for the purpose of the maintenance of the three potential life tenants.  That is clear from clause 4(a) which gave an absolute discretion to Albert as to the apportionment of an amount for the purposes of clause 3(b)(i).  In the event that there was no obligation to any life tenants at the expiration of 10 years, clause 5(a) required the distribution of that 30% equally between five brothers.  If there was a remaining obligation to a life tenant that 30% would be retained in trust to meet that obligation until the death of the last life tenant.  At that time that 30% would be distributed equally between the five brothers pursuant to clause 5(a).

11.  It is equally clear that clauses 3(b)(i), 4, and 5(a) are inextricably linked in that the 30% of the residuary estate referred to in each clause must be the same 30%.

The expiry of the 10 year period

12.  Apparently in anticipation of the expiry of the 10 year period prescribed in the will, the 1^st plaintiff (“Ms Liang”) was appointed Administratrix of the will by an order of the court on 29 March 2006.  By a further order of the court on 29 September 2006, the 2^nd plaintiff (“Ms Lau”) was appointed to be the co‑Administratrix of the estate.

13.  The 10 year period after the death of the late Mr Tsui duly expired 2 November 2006.

14.  On 22 July 2015, Madam Yuen passed away, and the obligation on the Administratrices to maintain her terminated. With the death of the last life tenant, it is now open to the Administratrices to seek to wind up the estate.  Following the sale of four properties representing approximately 70% of the estate, a distribution was made to the residuary beneficiaries pursuant to clause 5(b) – (f).  A sum of $10.5 million remains still to be distributed pursuant to that provision, (see §37 below).  There is no dispute in that respect.

15.  The question now arises as to how the distribution of the 30% of the estate retained in order to meet the obligations of the life tenant should be dealt with.

The competing arguments

16.  There are two competing arguments.

17.  The position taken by the Administratrices is that that 30% of the estate had not been appropriated for the purposes of clause 5(a) of the will, but merely identified in order to provide income in order to meet their obligations under clause 3(b)(i) of the will.  Consequently, Mr P Y Lo on their behalf, submitted that that 30% falls into residue to be distributed unequally between the five brothers pursuant to clause 5(b) – (f).

18.  Mr To, for the estate of Mr James Tsui, and Mr Ho for Eric, both say that there has been an appropriation of 30% of the estate for the purposes of clause 3(b)(i), and that consequently the distribution of that 30%, upon the death of the last life tenant, is to go according to clause 5(a), that is equally between the five brothers as tenants in common.  That position was supported by Bernard and Michael, both of whom appeared in person.

19.  Albert also appeared in person.  On this aspect of the case told me that he understood both arguments and that he was content for me to make the decision.  He made no submission on the competing arguments.

20.  The position of the Administratrices favours Albert, because the distribution they propose is an unequal distribution in his favour.

Appropriation

21.  Appropriation is the process whereby a personal representative uses a specific asset or group of assets to meet in full, or in part, a pecuniary entitlement to the beneficiary: see Williams, Mortimer & Sunnucks, Executors, Administrators and Probate, 20^th Edn §55‑54.  The power to appropriate may come from the will itself, or by statute.

22.  In the present case although no specific power is granted to the Administratrices in the will to appropriate, it is clear that Mr Tsui anticipated that there should be able to be an appropriation in order to provide for the life tenants.  Clause 4(a) of the will provides:

“4     I direct as follows: ‑

(a)  In apportioning the amount for the purposes specified in clause 3(b)(i) here of, the said (Albert) shall have absolute discretion and his decision shall be final and conclusive.”

The absence of a specific power to appropriate does not prevent an appropriation being made.  It is clear from section 68(1) of the Probate and Administration Ordinance, Cap 10 (“PAO”) that the Administratrices have power to appropriate if they think it just and reasonable.  Although the expression used in the will is “apportioning”, it is clear that in the event of any apportionment made, the sum or assets so apportioned may then be appropriated to the particular legacy or legacies.

23.  An appropriation cannot be made which might prejudicially affect any specific devise or bequest: section 68(2)(a), POA. Mr Lo attempted to argue that this provision prevented any step that might have been taken by the Administratrices in being considered an appropriation.  The argument must fail.  In the context of this estate, it is plain that the residuary bequest in clause 5(a) is not a specific bequest.

24.  What constitutes a specific bequest has been described by Williams on Wills, 10^th Edn at §30.3 in these terms:

“A specific legacy is a legacy of something forming part of the testator’s estate, which is by the will distinguished and separated from the whole of his personal property or from the whole of the general residue of his personal estate. It must be identified by a sufficient description, and separated in favour of the particular legatee from the general mass of testator’s personal estate.”

25.  From that definition, (apart from plain reality), the amount to be dealt with under clause 5(a) clearly constitutes part of the general residue in the estate.  There is plainly no breach of the provisions of section 62(2)(a), POA.  Even if there has been an appropriation of 30% of the estate for the purposes of clause 5(a), (an argument rejected by Mr Lo), that 30% could not be described as a specific request.

26.  The following passage from Williams on Wills, 10^th Edn, §29.15, describes how an appropriation may be made:

“An appropriation does not require any writing to carry it into effect so far only as it is an appropriation, but insofar as an appropriation requires for its complete effect a transfer of property, the necessary transfer must be made in the appropriate way, either by delivery or writing under hand or by deed as the nature of the property requires. The appropriation may thus be evidenced by oral statements, by letters, by implication from the acts of the parties concerned, or by a recital in a subsequent instrument.”

It is not suggested in this case that for there to be an appropriation, there must be a formal legal transfer of any of the property in question.

27.  A working example of an appropriation is to be found in Re Nickels, Nickels v Nickels [1898] 1 Ch 630.  The headnote appropriately sets out the factual circumstances:

“A testator gave the proceeds of his residuary estate upon trust as to one undivided sixth to pay the income to his eldest son for life, and after his death to pay the capital to his children, and as to the remaining five‑sixths upon similar trusts for the testator’s for other sons and his daughter and their children, and he empowered his trustees to pay over a portion of the capital of the settled shares to any of his six children absolutely, notwithstanding the previous trusts. In 1881 the then trustees paid to each of the five sons one‑half of his share, and his daughter one‑sixth of her share absolutely; and they also set aside for the daughter and her children a sum of stock sufficient at its then value to make up with the sum advanced to her one half of their share. The income of the stock was paid to the daughter to her death in 1896.”

28.  In the accounts rendered by the trustees down to the death of the daughter, the appropriation was recognised.  Following the death of the daughter a question arose as to whether there had been a valid appropriation to her share or whether the distribution ought to proceed upon the basis of the present value of all the securities subject to the trusts of the will.  The court was in little doubt that there had been a proper appropriation to the bequest, and that consequently the stock should be distributed to her children.  By identifying the sum set aside for the daughter and her children the trustees had made an appropriation.

29.  The effect of an appropriation is that the executor ceases to hold the property as executor, and if he does not immediately deliver or transfer it to the beneficiary, he holds it as a trustee for the beneficiary, and not as part of the assets of the testator’s estate: see Williams on Wills, §29.14.  It necessarily follows from the that, that the beneficiary takes the appropriated property for better or worse, and any increase or decrease in the value of the appropriated property or the investments representing the same belongs to or falls on the beneficiary. Further, the beneficiary is not affected by any subsequent decrease in the value of the remainder of the testator’s estate or any part of it.

30.  The appropriation also fixes the value of the property at the time the appropriation was made.  Thus, when making the distribution is pursuant to clause 5(b) – (f), it would have been necessary for the Administratrices to have regard to that value when fixing the shares of the residuary legatees to be distributed following the sale of the various items of property.

The evidence

31.  The evidence does not suggest that any steps relevant to the question of an appropriation occurred prior to 2006.  With the expiry of the 10 year period from the date of the of the late Mr Tsui, in March 2006, Ms Liang was appointed an Administratrix of the will, and in September 2006, Ms Lau was appointed co‑Administratrix.  On 16 February 2007, Letters of Administration with the Will annexed were granted to the Administratrices.

32.  On 13 March 2007, Ms Liang wrote to the beneficiaries on behalf of the Administratrices.  Her letter contained the following:

“8. A meeting was held between me and (Ms Lau) on 27 February 2007 to discuss distribution and at that meeting we discussed the interpretation of the terms of the Will regarding distribution and we were of the view that we have to set aside 30% (in accordance with clause 5 as we note that 10 years has expired after the death of the deceased) for the purposes set out in clause 3(b)(i) until all the life interest is extinguished and whatever balance is left of the 30% to be then distributed in equal shares among the other beneficiaries.

9. We also agree that valuation therefore had to be done to ascertain what is 30% of the assets of the Estate which consist of the following:‑

(i) The properties appearing in the schedule.

(ii) The HSBC shares and the dividend (if any) presently in the custody of HSBC bank.

(iii) The cash and rental income, some of which still not accounted for by Albert Tsui and James Tsui and Madam Leung.

(iv) Regarding the cash and rental income is still not accounted for, it was agreed that I would write to James Tsui and Albert Tsui and Madam Leung Yuk Chun to remind them to account for the same.” (sic) (emphasis added)

33.  On 13 June 2007, the Court gave leave to the Administratrices to sell six of the seven properties then held by the estate.  The property not be sold was that occupied by the sole life tenant, Madam Leung. That order was varied on 19 July 2007, to enable the sale of four properties then owned by the estate, save for the two Shanghai Street properties and the Mirador Mansions occupied by Madam Yuen.  Those three latter properties, and sums of cash are all that now remains on the estate.

34.  The distribution of the proceeds of sale of the four properties pursuant to clause 5(b) – (f) was approved by the Court.  At that time, the valuation showed that the three properties retained represented 28.5% of the total value of the capital assets of the estate.

35.  There is no suggestion that any of the five brothers opposed the making of those orders.  In due course the four properties were sold and substantial distributions were made, pursuant to clause 5(b) – (f), to the five brothers.  In the circumstances, the fact that they did not oppose the orders, and their acceptance of the distributions, plainly demonstrates their consent to the procedure adopted.

36.  In an affidavit dated 25 February 2016, filed for the purpose of these proceedings, Bernard said this:

“57 I beg the court not to disturb the Court orders granted in July 2007 which orders have effectively appropriated land properties and funds into the 30/70 residue portions.

58 The trustees did carry out the appropriation orders by distributing for the purposes of clause 5(b) – (f) relating to the 70% residue. As well, the trustees have been using the rental incomes from the land properties being under the 30% residue, for the purposes of clause 5(a) or clause 3, 3(a), 3(b)(i) in paying for testamentary expenses.

59 The equalisation has been done by the trustees as shown on their financial statement affirms that the court hearing on 8 May 2013 and being exhibited as ‘BT‑6’.”

60 I beg the court in directing the trustees to follow the appropriations as established by the July 2007 court orders and use the equalisation already done and affirmed by your own office.  I have no objection for retaining Ms Lau in doing accounting for the estate.” (sic)

37.  The financial statement referred to (BT‑6), prepared by the Administratrices contains the following entry:

“Allocation of Capital Account Balances as at 1 November 2006

–For Clause 5(a)	$20,221,526.12
–For Clause 5(b) – (f)	$10,551,559.86
	$30,773,125.98 ”

Discussion

38.  The statement contained in Ms Liang’s letter of 13 March 2007, is a clear and unequivocal statement that 30% of the estate was being “set aside” under clause 3(b)(i).  At the same time the Administratrices recognised the consequences of that setting aside.  By identifying that 30%, it was immediately plain to the Administratrices that when the life interests were extinguished, that 30% would be distributed equally amongst the residuary legatees pursuant to clause 5(a).  They said so in precisely those terms.

39.  I agree entirely with Mr Ho that it makes no sense at all for 30% of the assets, are being used to meet the obligation to the life tenants, being co-mingled with the remaining 70% of the estate.  That is because once the expiry of 10 years had occurred it was then open to the Administratrices to distribute the remaining 70%.  That is precisely what was done.

40.  The clear effect of the decision to seek orders from the Court to enable the disposal of 70% of the estate and the distribution of the bulk of the proceeds of sale to the residuary legatees pursuant to clause 5(b) – (f) was to “ring fence” the 30% required under clause 3(b)(i).

41.  Furthermore, unless 30% of the estate were appropriated to the obligation to the life tenants, it is difficult to see how the scheme of the will could be met.  While it is correct that Albert was to receive an unequal share, it was only an unequal share of 70% of the residue, not an unequal share of the whole.  As to 30% of the residue, the five brothers were to share equally.  That result could only be achieved if there was an appropriation of 30% of the estate to meet not only the obligation to the life tenants, but also the requirement to distribute 30% of the estate equally between the brothers following the death of the last life tenants.

42.  Subsequently, as may be seen from the accounts exhibited by Bernard, the trustees dealt with the corpus of the estate then existing by way of two separate capital accounts.  These two accounts were specifically allocated by the Administratrices between clause 5(a), and 5(b) – (f).

43.  I am satisfied that the acts of the Administratrices in setting aside 30% of the estate for the purposes of clause 3(b)(i), of seeking an order from the Court permitting the disposal and distribution of 70% of the estate to the residuary legatees pursuant to clause 5(b) – (f), and the separate identification in the accounts of funds relating to those two sets of clauses constituted an act of appropriation on the part of the Administratrices 30% of the estate to the purposes of clause 5(a).  They specifically contemplated that consequence in the letter of 13 March 2007.

44.  The appropriation in this case is evidenced by the letter of 13 March 2007, by implication from the steps taken by the Administratrices to enable the realisation and distribution of 70% of the estate pursuant to clause 5(b) – (f), and the treatment of the funds remaining in the estate by the accounts.  It is further evidenced by the act of the Administratrices in dividing the proceeds of sale of the HSBC shares 30% – 70%, distributing 70% pursuant to clause 5(b) – (f), and retaining 30% for the purposes of clause 3(b)(i).

45.  I accordingly conclude that the three remaining properties, any funds held by the Administratrices arising from income from those properties, and any sum now remaining in the hands of the Administratrices arising from the 30% of proceeds of sale of the HSBC shares set aside by the Administratrices, fall to be distributed equally between five brothers pursuant to clause 5(a) of the will.

46.  The conclusion I have reached in the previous paragraph is reinforced by statements made by the court in the course of considering various applications in the past.

47.  On 16 November 2007, the question of the will came before A Cheung J, (as he then was), and certain rulings were made.  In the course of those rulings the judge said this:

“Moving to the facts in the present case, Mr Albert Tsui has made the decision to apportion the entire 30%, subject to whatever expense the annual family reunion that may have to be deducted from the 30%, in favour of Madam Yuen, his mother. Mr Tsui has told the court by way of submission that he has got very good reasons that his decision. I have got nothing from Madam Leung’s side to challenge that decision, so on the present state of play, I do not think I can require Mr Tsui to further elaborate on his decision. But that does not stop Madam Leung’s side from putting materials to challenge Mr Tsui’s decision, and unless and until I shall receive such materials, it is really premature to say whether the matter can or should be taken further.”

There is no evidence to suggest that the apportionment referred to was subsequently challenged.  That percentage having been apportioned, the acts of the trustees thereafter constituted an appropriation of the assets representing the 30% apportioned.

48.  It is relevant too, that in the same ruling, the judge had this to say:

“The second question is the cost of maintaining the trust. That applies to both clause 3 as well as clause 5(a).

On this particular issue, i.e. how the trusts under clause 3 in clause 5 are to be financed, I shall deal with the two trusts separately.

In relation to the trusts created under clause 3, I think all parties are in agreement that the cost of maintaining the trust of the first 10 years after the death of the testator should come out from clause 3(a) as part of the testamentary expenses, which term is wide enough, according to the authorities, to cover administration expenses.

Moving on to clause 5(a), which creates another trust to be set up after the expiration of the 10 years, the competing constructions may be summarised as follows. Mr Ma, on behalf of (Eric) and (Bernard), submits that, pursuant to clause 5, after the expiration of the first 10 years and after all remaining assets liquidated, the money is ready to final distribution. 70% of the money is to be distributed in accordance with 5(b) – (f), in favour of the various beneficiaries respectively.

For the remaining 30%, it should be finally distributed as well, but it should be distributed to set up a trust with three women or survivors of them having a life interest subject to Mr Albert Tsui’s absolute discretion to apportion, and with five sons having interests as remaindermen i.e. the five sons will share in the 30% after the death of the three women.

According to Mr Ma, it is not only fair and just but also the only practical way to require that the trust be financed solely by about 30%. Any other interpretation would make final distribution of the residual estate impossible.

Mr Watkins, on behalf of (the Administratrices), and apparently all other parties agree with his position, maintains that the trust to be created under 5(a) is nothing other than they trust mandated under the will. The maintenance of that trust forms part of the cost of the administration. Until after the death of the three women and until the final distribution of the 30% in favour of the five sons pursuant to that trust should happen, administration of the estate is not complete.

Therefore, maintenance of the trust is simply part of the work of administration. The cost of maintaining the trust therefore falls within the term ‘testamentary expenses’ under 3(a).

Ms Liang, one of the two Administratrices appointed by the court, supports Mr Watkins’ argument that seeks to buttress it was a further argument based upon clause 4 of the will. I can follow the logic of her argument, but the premise of the argument is that clause 4 has a life of its own and potentially it can last longer than the first 10 years, and as things have happened it indeed outlasts the first 10 years, because up till now, both Madam Yuen and Madam Leung are still alive and well.

As regards the underlying premise of Ms Liang’s argument, having given the matter due consideration, I find that argument has indeed got support from the wording of clause 5(a), which refers back to clause 3(b)(i), and clause 3(b)(i) brings into action clause 4. As I have previously explained in relation to clause 3, clause 3(a) specifically provides that the testamentary expenses should come out from the net proceeds first before we come to distribution of income.

I have given the matter some thought. Mr Ma’s argument obviously has the attraction of simplicity, but in the final analysis I think both Mr Watkins and Ms Liang are correct. Given the way the trust is required to be set up the purposes of the trust, administration of the state cannot be completed until after the death of the three ladies.

The trust is something required to be set up as part of the administration work. The cost of setting up and maintaining the trust therefore form part of the administration expenses, and I do not see how those expenses should not come out from the estate as part of the testamentary expenses. In other words, I am afraid the testator has made a less than perfect will in this regard, but then nobody is perfect.

Even though no final distribution could be made under clause 5 before the death of the three woman, that unfortunately is the consequence of all beneficiaries will need to live with.  There is nothing to stop the Administratrices from making provision or distribution is according to their best judgment in the meantime.”

49.  These statements demonstrate the manner in which clauses 3(b)(i), 4 and 5(a) are linked together, with the result that in the event of an appropriation of a fund to meet the requirements of clause 3(b)(i), that fund was thereafter identified as the fund which would ultimately be distributed pursuant to clause 5(a).  The statements by the judge are entirely consistent with the conclusion that I have reached that there has been an appropriation of 30% of the estate the purposes of clauses 3(b)(i), 4 and 5(a).

Albert’s concern as to income

50.  As I have said above, in respect of the substantive issue before the court, the ultimate distribution of funds that had been used to meet clause 3(b)(i), Albert was content to leave the matter to the court.  The great bulk of his submission to me related to a concern that audited accounts should be prepared by an international firm of chartered accountants.  He appears to take the view that there has not been a proper or complete accounting of the distribution of income that has arisen from the estate.

51.  This was a question which did not directly a rise on the Originating Summons.  Although the Administratrices had written to Albert seeking his views on the matters raised he had not made any response, nor, it appears had he not raised any particular concern with them on the question of accounting for income.  Consequently, Mr Lo was in no position to deal with issues of the distribution of income.

52.  I am accordingly unable to make any orders in this respect at the present time.  I will leave it to the Administratrices to take such steps as they consider appropriate in the light of the concerns that Albert has raised.  It may well be that if the Administratrices were to sit down with Albert and go through the various accounts which have been prepared, they may be able to satisfy him as to his concerns.  Albert for his part should recognise that in the event that he should bring proceedings in this respect and fail in those proceedings, he may well be exposing himself to substantial costs orders against himself.

Madam Leung

53.  Any entitlement Madam Leung had in respect of the estate terminated upon Albert making a decision, as he was entitled, pursuant to clause 4(a) of the will, that no provision should be made for her. Madam Leung made no challenge to that decision.  Madam Leung told me that she did not wish to say anything in respect of the proceedings before the court. However her daughter, speaking for her, raised a question of funeral expenses, saying that her mother had paid those expenses and had not been recompensed in that respect.

54.  This is a matter which should have been raised a long time ago, and the time for the Court to deal with it has now gone. I will leave it to the Administratrices to take whatever steps they consider appropriate in this respect.  If it is right that Madam Leung has not been recompensed it would be appropriate that the residuary legatees should direct the Administratrices to correct the matter now.  But there is no order that I can make.

The terms of the orders

55.  Although a draft order was annexed to the skeleton submitted by Mr Lo, there was no discussion at the hearing as to appropriate orders.  The parties are invited to agree upon the terms of the appropriate orders to be made which are to be submitted to me for approval within 21 days.  In the event that agreement cannot be reached as to the terms of orders I will hear the parties on three days notice.

56.  Albert raised a concern in respect of Messrs Lo & Lo, solicitors, being instructed in respect of the conveyancing steps that would arise on the sale of the three properties.  His concern seemed only to be that he had not been consulted and that the decision by the Administratrices to use those solicitors appeared to be an arbitrary one.  Neither reason is a basis upon which the decision of the Administratrices should be set aside.  Lo & Lo are a perfectly respectable firm of solicitors and quite capable of undertaking the conveyancing that will arise in this matter.  In particular, I note that the indemnity insurance held by the solicitors is more than adequate to cover the transactions that are contemplated.

57.  The decision of the Administratrices to instruct Lo & Lo to act as solicitors in respect of any conveyancing arising from the sale of the three properties is accordingly approved.

58.  Liberty to apply is reserved to the plaintiffs, and the 2^nd to 6^th defendants inclusive.

Costs

59.  After I had completed this judgement, but before it was handed down, I received a series of submissions on incidental matters and the fall of the order.  It is not possible to deal with those matters in this judgement.

60.  The defendants are to have until 4 PM on Wednesday 29 June, to file any further submissions they wish to file in this respect.  The plaintiffs must reply by 4 PM on Wednesday 13 July.  The parties will be notified by 4 PM on Friday, 15 July 2016, if I am able to deal with matters on paper.  If I am unable to deal with the matter on the papers by that time I will hear the parties on all outstanding matters on Tuesday 26 July at 10 AM.