MOORTHY SELVARAJ (as one of the beneficiaries of the estate of KARUPAYA SELVARAJ, Deceased) v. KARUPAYEE AMMAL (as the administratrix and one of the beneficiaries of the estate of KARUPAYASELVARAJ, Deceased) AND OTHERS

HCA 413/2016

[2024] HKCFI 3628

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 413 OF 2016

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BETWEEN

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D E C I S I O N

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1.  On 2 February 2024 I handed down my judgment in this Action and made a costs order nisi that the Plaintiff pays the 2^nd Defendant and the 5^th Defendants’ costs including any costs reserved with, in the case of the 5^th Defendant, a certificate for two counsel, such costs to be taxed if not agreed and paid forthwith.

2.  The Plaintiff asks me to vary the order and instead order that (A) the 5^th Defendant’s costs be paid by the Plaintiff; (B) 70%, alternatively 60%, of the Plaintiff’s costs of the Action up to 12 October 2022 be paid from the Estate and (C) there be no order as to the costs of the Action as between the Plaintiff and the 2^nd Defendant.

3.  The 5^th Defendant seeks an order that the Plaintiff pays the 1^st, 2^nd and 5^th Defendants’ costs of the Action. In other words, the 5^th Defendant only seeks a variation of the costs order nisi, to provide that the Plaintiff also pay the 1^st Defendant’s costs.

4.  The Plaintiff summarises the reasons it says I should make the costs order it seeks as follows. The Plaintiff’s claims in this Action were predominantly focused on the removal of the 1^st Defendant as administratrix of his Father’s Estate together with obtaining an account from the 1^st Defendant rather than the Plaintiff’s appointment as the 1^st Defendant’s replacement. All this was clearly in the interests of the Estate. The Plaintiff’s claims for removal and an account were clearly meritorious and reasonable. However, in the light of the 1^st Defendant’s death on 12 October 2022, which avoided the necessity of determining what the Plaintiff characterises as the principal issues, allowing the Plaintiff to recover his costs from the Estate while making no order in respect to the 1^st Defendant’s costs is a just solution in the circumstances bearing in mind it is beyond doubt, contends the Plaintiff, that the 1^st Defendant had failed to discharge her duties qua administratrix and was not fit for that office. The focus of the Action, contends the Plaintiff, only shifted to the matters addressed in my judgment after the 1^st Defendant’s death. A 30 to 40% discount of the Plaintiff’s costs before the 12 October 2022 fairly reflects, amongst other things, the Plaintiff’s ultimate failure to enforce the DFA. So far as the 2^nd Defendant’s costs are concerned, the Plaintiff says that as the 2^nd Defendant made no meaningful contribution to the debate before me and failed to achieve her own appointment, the Plaintiff should not be ordered to bear such costs as she may have incurred. The 2^nd Defendant represented herself from 13 September 2022 before that she had solicitors.

5.  It is not necessary for me to set-out the background to this application as it is explained in my earlier judgment. Although the argument on costs before me was quite extensive it seems to me that the answer to the Plaintiff’s principal argument is straightforward. As illustrated by the matters referred to in [23] to [25] of my Judgment, the Plaintiff contributed to the delays in the progress of the administration of the Estate and did so for reasons, which explain his desire to take over administration of the Estate; a position he maintained right up until commencement of the trial. In short, the Plaintiff’s aim in commencing the Action was twofold, to enforce the DFA and take over the administration of the Estate. He failed on both counts. It seems to me artificial to treat the Action as being justified, because of the 1^st Defendant’s failure to progress the administration. I see no reason to conclude, as the Plaintiff suggests I should, that if the 1^st Defendant had not died such issues as I might have been required to determine would have been decided in the Plaintiff’s favour. What is clear is that the other Family members interested in the administration of the Estate have sided against the Plaintiff. Precisely how the issues would have evolved if the 1^st Defendant has not died and how they would have been determined seems to me unclear. I can see no reason why I should assume that the Plaintiff would have been in a material sense successful if the 1^st Defendant’s conduct of the Estate had been fully explored before me particularly as I found the Plaintiff to be a wholly unconvincing witness[1].

6.  The Plaintiff has also relied on the contents of without prejudice as to costs correspondence. This does not in my view assist the Plaintiff; on the contrary it weighs if anything against him. It was the 1^st Defendant who first proposed the appointment of an independent administrator from Kroll. The Plaintiff did not agree and suggested PricewaterhouseCooper (“PwC”). In the open correspondence in 2023, the Plaintiff continued to insist on PwC, even when presented with the more economical option of Grant Thornton, on the basis that only a “Big 4” firm of accountants would be capable of handling the administration of an estate of the present one’s size and complexity. Based on the evidence that I have seen this was nonsense and tends to suggest that the Plaintiff wanted his choice presumably on the basis that somebody proposed by the Defendants might be less well disposed towards him.

7.  Although the 2^nd Defendant was unsuccessful in obtaining her own appointment as administratrix of the Estate, she was drawn into the Action because of the Plaintiff’s unsuccessful application. I can see no good reason to deprive her of such costs as she may have incurred, because she did not take a neutral stance and opposed the Plaintiff’s appointment. I also accept the submissions made by Mr Nagpal that in the circumstances such costs as the 1^st Defendant occurred until her unfortunate death in October 2022 should be paid by the Plaintiff; although not, as the 5^th Defendant sought, with a certificate for two counsel as I am not aware of any reason which would justify it. The costs order will be amended to provide that the Plaintiff also pays the 1^st Defendant’s costs.

8.  I will order that the Plaintiff’s summons filed on 16 February 2024 be dismissed and that the Plaintiff pays the costs of both summonses to vary the costs order forthwith with a certificate for two counsel such costs to be taxed if not agreed.