MICHAEL TAK YAN MONG as the executor of the Estate of Hilda Mong (Deceased) v. JENNIFER TAK WAI YIP also known as JENNIFER TAK WAI MONG AND OTHERS

HCA 996/2020

[2026] HKCFI 2514

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 996 OF 2020

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JUDGMENT

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A.      INTRODUCTION

1.  This is the trial of an action which involves disputes among members of the Mong family on the beneficial ownership of a number of assets (“the Disputed Assets” – see [3] below).  It was commenced by Michael Tak Yan Mong (“Michael”) in his capacity as executor of the estate of the late Hilda Mong (“Mother”), against his elder sister Jennifer Tak Wai Yip (“Jennifer”) and Jennifer’s 2 sons: Raymond Alexander Yiu Chung Yip (“Raymond”) and Victor Alan Yiu Tsun Yip (“Victor”).

2.  In short, it is alleged by Michael that all the Disputed Assets belonged to Mother and were held (or handled) by Jennifer on Mother’s behalf, but that Jennifer now claims to be the owner of the same; and/or that she has dealt with the same without Mother’s consent or without accounting to Mother.  On the other hand, it is the defendants’ defence that these assets all came to be owned by Jennifer as a gift from her father Jeffrey Man Kit Mong (“Father”) or Mother, and/or that Jennifer had dealt with these assets according to the instructions of Mother.

3.  The Disputed Assets are:

(1) Funds in an amount exceeding US$600,000 taken by Jennifer from Father’s bank accounts (“the Estate Management Funds”);

(2) Shares in Hong Kong-based companies (“the Hong Kong Shares”), namely:

(a) 1,000 shares in Yue Shun Cheung Company Limited (“YSC”) previously held by Father and left to Mother upon his death (“the Inherited YSC Shares”);

(b) 1,000 YSC shares which Father had previously held on trust for Mother under his name (“the YSC Shares on Trust”);

(c) 600,000 shares in Haw Yuet Enterprises Limited (“Haw Yuet”) previously held by Father and left to Mother upon his death (“the Inherited Haw Yuet Shares”)

(3) Funds exceeding US$17,100,000 once held in a bank account at UBS AG (“the UBS Account”) under the joint names of Mother, Michael, Jennifer and the youngest child of Father and Mother, namely, Angela Tak Fan Mong (“Angela”);

(4) Dividends in the amount of HK$374,824.93[1] declared on the 1,000 shares (“the SHETC Shares”) of Shun Hing Electronic Trading Company Limited (“SHETC”) which were previously held by Father and left to Mother upon his death (“the SHETC Dividends”).

4.  Michael therefore makes the following claims against the defendants:

(1) Proprietary claims and claims of breach of trust / fiduciary duties against Jennifer in respect of Disputed Assets, and against Raymond and Victor in respect of the Hong Kong Shares and funds from the UBS Account;

(2) Claims against Jennifer, Raymond and Victor as trustees or executors de son tort under common law or section 58 of the Probate and Administration Ordinance (Cap. 10, Laws of Hong Kong) (“PAO”); and

(3) Claims of knowing receipt against Raymond and Victor in relation to the funds from the UBS Account.

B.      UNDISPUTED/INDISPUTABLE BACKGROUND

5.  The following facts are either undisputed or indisputable.

B1.    Parties and background

6.  Father and Mother had three children, i.e. Jennifer, Michael and Angela (in descending order of age).

7.  Initially, Father, Mother, Jennifer, Michael and Angela (collectively “the Mong Family”) resided in Hong Kong.

8.  In around 1967, the Mong Family emigrated from Hong Kong to Vancouver (when Jennifer, Michael and Angela were 12, 9 and 6 respectively). Father continued to work in Hong Kong, and financially supported the Mong Family.  He would visit Vancouver around twice a year.

9.  In around 1979, after completing her university studies, Jennifer returned to Hong Kong permanently and resided with Father.   At first, they lived together with Father’s parents and siblings.  In around 1981, Father and Jennifer moved into a flat in Lily Court, Worldwide Gardens, Sha Tin (“the Lily Court Flat”).  Jennifer got married with the late Thomas Yip (“Thomas”) in 1983, upon which Thomas (and later their children) also moved into the Lily Court Flat.  Jennifer’s family lived together with Father all the way until his passing in 1997.

10.  Mother, Michael and Angela continued to reside in Vancouver. Save for occasional trips, Michael and Angela rarely visited Hong Kong.

11.  Hence, at all material times, Mother, Michael and Angela were ordinarily resident in British Columbia, Canada; whereas Jennifer, Raymond and Victor were ordinarily resident in Hong Kong.

12.  Mother was predeceased by Father, who passed away on 12 May 1997 in Honolulu, Hawaii unexpectedly while he was on holiday there with Mother. He left a last will and testament, respectively appointing Michael as the sole executor and Mother (or if she predeceased him, then Michael) as the sole beneficiary of his estate (“Father’s Estate”).  As Michael renounced probate, letters of administration in respect of Father’s Estate were granted to Mother on 21 April 1999.

13.  Mother passed away on 30 March 2017 in Vancouver.  Pursuant to the last will and testament of Mother dated 21 August 2002 (“Mother’s Will”), Michael is the sole executor of the estate of Mother (“Mother’s Estate”). Michael, Jennifer, Angela together with Mother’s grandchildren (including Raymond and Victor) are the beneficiaries under Mother’s Will.

B2.    AET and Trustee Action

14.  Mother set up an alter ego trust in 2010 (“the AET”) in British Columbia, Canada, in which Michael is named as the substitute trustee, and Michael, Jennifer and Angela together with Mother’s grandchildren are named as beneficiaries.

15.  In 2017, Michael commenced proceedings in British Columbia, Canada (proceedings no. S175499, “the Trustee Action”) in his capacity as trustee of the AET and the sole executor of Mother’s Estate against Jennifer, seeking declarations that the property at 608 West 54 Avenue, Vancouver (“the 608 Property”) and funds in an account at BMO Nesbitt Burns (“the BMO Account”) are assets falling within the AET or, alternatively, that Jennifer is holding these assets on trust for Mother’s Estate. The claim against Jennifer was subsequently amended in 2018, such that the Trustee Action was thereafter only pursued in Michael’s capacity as the trustee of the AET.

16.  The trial of the Trustee Action took place in 2021, in which, among others, Michael and Jennifer gave oral evidence.

17.  On 5 August 2022, the Supreme Court of British Columbia handed down a judgment (“the Canadian Judgment”), finding in favour of Michael (in his capacity as trustee of the AET) in the Trustee Action. The Judge granted declarations that Jennifer held her legal title to the 608 Property as bare trustee for Michael (in his capacity as trustee of the AET), and that Michael (in his capacity as trustee of the AET) is the sole beneficial owner of the funds in the BMO Account. Jennifer’s counterclaim (alleging that certain assets were transferred into the AET in breach of trust) was dismissed.

18.  The Canadian Judgment was not appealed.

C.      CREDIBILITY OF WITNESSES

C1.    General principles

19.  The approaches for assessing the credibility of witnesses are well established, and are summarised as follows[2]:

(1) Generally speaking, contemporaneous written documents and documents which came into existence before the problems in question emerged are of the greatest importance in assessing credibility;

(2) Importance should be attached to the inherent likelihood or unlikelihood of an event having happened, or the apparent logic of events;

(3) The court will also attach importance to the shift of a party’s case, consistency of the witness’ evidence with undisputed or indisputable evidence, and the internal consistency of the witness’ evidence. The latter type of consistency may be tested by a comparison between the witness’ oral testimony and his/her witness statement, and also his/her answers given to different questions during examination at the trial;

(4) The court should consider a witness’ motive for deliberately not giving truthful testimony.  For example, telling the truth may prejudice his interest, or a just determination of the litigation may affect his interest;

(5) It is essential to have regard to the entirety of a witness’ evidence. A witness can make mistakes, but the mistakes do not necessarily affect other parts of his evidence. Likewise, a witness may lie. However, lies themselves do not mean necessarily that the entirety of that witness’ evidence is to be rejected.  A witness may lie in a stupid attempt to bolster his case, but the actual case nevertheless remains good irrespective of the lie;

(6) On the other hand, where it is shown that a witness has been discredited over one or more matters to which he has testified, this fact is relevant to the assessment of his overall credibility; 

(7) The court should also consider whether a witness is evasive, argumentative and/or tends to give tangential speeches so as to avoid questions while being cross-examined;

(8) While the court is entitled to take demeanour into account when assessing testimony, it should be borne in mind that demeanour can be deceptive and is therefore to be approached with care.

20.  As this action involves disputes within a family, what G Lam JA said in Cheung Yuk Ying Engracia v Macgregor Isabella [2023] 3 HKLRD 164, [2023] HKCA 749 is instructive:

“[…] The resolution of factual disputes between family members not infrequently presents challenges to the court, for there is often not much documentation to go by; commercial standards of behaviour may not be appropriate for gauging the parties’ conduct; and the rights and wrongs of parties to intimate human relationships can elude the closest scrutiny in a court of law […]”

21.  It has been pointed out by the plaintiff’s counsel that this family dispute action is different from others because there are quite a lot of contemporaneous emails (especially between Angela and Jennifer) placed before the Court.  That is of course true, and the Court would definitely have to take the contents of those emails into account when assessing the respective cases of the parties.  Having said that, it should also be borne in mind that there is normally a fundamental difference between a family dispute and a business dispute – not only that it would be less likely for family members to put every agreement in writing, it would also be unrealistic to expect that family members would always conduct themselves according to strict logic and without being affected by family dynamics. 

22.  While Michael has initially served witness statements of 3 witnesses (including himself), he was the only witness who has given evidence at the trial at the end of the day because:

(1) The evidence of Mary Ho, General Manager of the Accounts Department of SHETC, is unchallenged, and as a result her witness statement has been adduced without cross-examination;

(2) Angela was not called as a witness because, according to Michael, she was only willing to give oral evidence upon conditions which were considered by Michael to be unacceptable.

23.  On the other hand, all 3 defendants (Jennifer, Raymond and Victor) have given evidence.  They have called no other witnesses.   

24.  I will consider their credibility generally in turn below.

C2.     Michael

25.  I regret to say it is my view that Michael is an incredible witness.

26.  It is my finding that there were many occasions when Michael was not interested in telling the truth, and that his main target was to say something bad about Jennifer.

27.  His evidence also bears a lot of features which show that they are unreliable if not untruthful –  He was evasive when he gave evidence, and would avoid answering questions when he knew that doing so directly would harm his case.  There were also many occasions when Michael would ask Mr Dawes SC to repeat the question so as to buy time and think how he could avoid answering the question whenever he was asked a question (despite the fact it was a simple one) the apparent answer of which was not favourable to his case. To me, this is not what a witness whose intention was to assist the court would do.  For avoidance of doubt, I have specifically considered whether Michael was just being very careful by asking for clarification of various questions. However, I have come to the conclusion that, for those occasions which I have mentioned above, he was not, because those questions were simple.

28.  Some of his evidence was also contradictory.  For example, while he initially maintained repeatedly that he had been told by his parents about certain tax advice, he subsequently accepted that he only knew about such matters after Father’s demise.  That means he could not have been told by Father about such tax advice.  In my view, he was trying to bolster his evidence on tax advice when he said Father also told him about such an advice.

29.  I will deal with his evidence in more details in Section D below.  For the present purpose, it suffices for me to quote the following examples:

(1) When he was asked whether Jennifer’s kids were close to his parents (i.e. Father and Mother), he only stated that Raymond and Victor spent a lot of time with Father and Mother.  When Mr Dawes SC asked whether that answer means “yes” to the question, Michael repeated the same answer, and said words to the effect that he was not sure about the definition of “close”.  I do not think it can be disputed that this is a straight forward question, nor that any reasonable person confronted with this question would need a definition at all so as to answer it.  This serves as a vivid example that Michael was avoiding to answer the question, apparently because a positive answer would be favourable to the defendants’ case;

(2) He adopted the same approach when he was asked to explain the basis for saying in his witness statement that Father and Mother would use joint tenancy for estate planning.  The question asked was simple.  Yet, he did not answer the question directly despite a few attempts by Mr Dawes SC.  I do not believe that Michael would be unable to do so if he was minded to tell the truth.  He was simply avoiding from doing it;

(3) When Michael was asked whether he accepted that Mother did not tell him about the transfer of certain shares in YSC and Haw Yuet to Jennifer, he refused to admit the same despite the clear fact that that was the case;

(4) When Michael was asked whether it was normal for his parents to want to give the Lily Court Flat to Jennifer since it was her home, he tried to avoid answering the question by saying something irrelevant such as he did not know (and he had never been told) what his parents chose to do.

30.  Some of Michael’s evidence do not make any sense at all.  I am of the view that that is because of his intention to hide the fact from the Court.  For example:

(1) While he alleged that Father indeed did not like his fiancée Anne, he said that Father did not tell him why, and that he did not ask Father for the reason either.  That is simply incredible;

(2) He further stated that his parents removed his name from a property situated at Angus Drive, Vancouver (“the Angus Property”) (which was held by Mother and Michael as joint tenants since 1987) out of his initiation sometime in the 1990s because his parents (and Father in particular) did not approve of his impending marriage.  This again does not make sense if he did not even know at the material time (as he alleged) why Father did not like his fiancée.

C3.    Raymond and Victor

31.  I find that both Raymond and Victor are credible witnesses.  They did not avoid answering any questions, and had given direct answers without hesitation (save that occasionally when they had to take time to think if the questions concern matters which took place long time ago), even if their answers were not favourable to the defence case.

C4.    Jennifer

32.  It is undisputed that Jennifer’s evidence is important in the present case because the ultimate result of the trial would to a large extent hinge on the question of whether her version of events is credible.

33.  I hold the view that she is a credible witness.  She was unshaken despite the detailed cross-examination by Mr Pao SC.  She has always been forthcoming in her answers.  Although there were times when she had given very long answers and at the end of the day she might have off-tracked, in my view, that is due to her desire to explain the family dynamics and the inter-personal relationship between different family members which is not an easy thing to do.  Specifically, I find that, on those occasions, she was not trying to avoid answering the questions posed to her.  Indeed, it is extremely unlikely that she would be able to make up long stories like those while she was in the witness box.

34.  The finding that Jennifer is a truthful witness is also supported by the fact that although there were opportunities by which she could give evidence (which could not be verified anymore because of lapse of time) in favour of her own case, she did not do so.  An obvious example was when she was asked whether she had signed any documents with the Sanwa Swiss Bank for the purpose of being added as an account holder[3]. She answered that while she had recollection of signing some documents for the bank, she could not remember what documents they were and the contents thereof.  She did not jump at the chance to say that she could remember that they were documents for the purpose of adding account holder.

35.  The plaintiff’s counsel have drawn my attention to the fact that Jennifer has admitted that she had been dishonest in her dealings with her siblings.  Insofar as it is submitted that this shows that she is generally speaking a dishonest person and as a result her evidence in court should be rejected, I disagree.  As explained by Jennifer, she had her innocent reasons for having to lie to Angela at times in light of the family dynamics, and generally speaking I accept her explanation.  In my view, that does not reflect her general character, and it certainly cannot be said that her attitude towards Angela shows that Jennifer is basically a dishonest person.

36.  The plaintiff has also made submissions on the inherent probability of Jennifer’s version of events in relation to the individual items of the Disputed Assets.  I will deal with those submissions further below.

D.      DISCUSSION

37.  Before I go into the individual items of the Disputed Assets, I should first of all give my views on the inter-personal relationship as well as some other aspects within the Mong Family which would be crucial on the determination of the issues relating to the Disputed Assets.

D1.    Jennifer’s relationship with Father

38.  It is Jennifer’s evidence that she had a very close relationship with Father during his lifetime.

39.  However, Michael does not agree with this.  He described the relationship between Father and Jennifer as “acrimonious”, and gave evidence that, as far as he was aware (based on his observations while he was staying with them at the Lily Court Flat), Father and Jennifer argued and frequently disagreed.  Further, Jennifer did not show much respect for Father, and tried to dominate over him.  She would call him “stupid old man”.

40.  Raymond also testified that there would be disagreements which would sometimes escalate into physical incidents between Jennifer and Father.

41.  Human relationship is undeniably complicated, and it is always difficult to describe a relationship between human beings, particularly family members, by using precise terms.  Be that as it may, generally speaking, I have no difficulty to find that the relationship between Father and Jennifer must have been very close by reference to the following objective facts:

(1) Jennifer was the only child of Father who had been living and working with him in Hong Kong since the 1980s;

(2) Jennifer and Father had never lived apart since Jennifer returned to Hong Kong in 1979, and even after she had got married and had her own children;

(3) Thomas was all along a practising dentist.  While there is evidence that he did not leave much assets behind upon his demise, I do not think it would be a problem for him financially to move away together with Jennifer and the children from the Lily Court Flat if the relationship between Father and her was really that bad.  In other words, the fact that Father and Jennifer had lived together for nearly 2 decades is a strong indication of their close relationship;

(4) The same logic applies to the fact that Jennifer had been working with Father for such a long time;

(5) Father had gifted to Jennifer 1/3 of the shares in YSC (in 1989) and 40% of the shares in Haw Yuet (in 1981), which respectively held Father’s business and residence in Hong Kong;

(6) Father had also authorized Jennifer to handle his personal accounts. Putting aside Father’s intention to gift any of those accounts to Jennifer, even if Michael’s case that such authorization was only granted for the sake of convenience is accepted, that would be sufficient to prove the close relationship between Father and Jennifer, for it is inherently improbable for Father to grant such authorization to Jennifer if their relationship was really that bad.

42.  Michael has drawn this Court’s attention to a number of matters in an attempt to persuade the Court that Father and Jennifer did not have a smooth relationship.  With respect, such efforts are futile.

43.  Firstly, it was said that Father and Jennifer argued a lot.  However, it must be borne in mind that this evidence was only given on the basis of his observation while he was physically with them in Hong Kong and in Hawaii.  However, they had only visited Hawaii together once, and Michael had admittedly rarely come to Hong Kong while Father was alive.  Therefore, little weight should be given to his aforesaid observation. 

44.  Furthermore, the fact that Jennifer and Father had had arguments does not necessarily mean that they had an acrimonious relationship, for that may well be their normal way to treat each other.  Indeed, one would have thought that two human beings would tend to have arguments if they worked together and lived under the same roof.  In any event, as aforesaid, the undisputed fact that they did not part ways despite such arguments speak volume on what their real relationship was like.

45.  Secondly, Michael said that Jennifer showed disrespect to Father, particularly, she called him names like “stupid old man”.  In my view, whether Michael felt that Jennifer did not show respect for Father is irrelevant.  The important question is whether Father felt that Jennifer was disrespectful to the extent that would affect their relationship.  For the reasons explained above, I hold that Father did not feel that way.

46.  Thirdly, Michael pointed out that Father had serious disputes with Jennifer about her desire to marry Thomas, so much so that in January 1983, Jennifer wrote a note to Mother and Angela, stating that her frustrations with Father had caused her to be “irritated, short-tempered”, that she had decided to move out as soon as she could, and that the risk of others thinking she was co-habiting with Thomas before marriage “cannot be worse than being associated with an idiot for a Father”. She even said she did not “want to risk any ‘shame’ [Father] may bring to [her] on [her] happy day”. However, what is undisputed is that Father did attend Jennifer’s wedding at the end of the day, and that Thomas moved into Jennifer’s home and lived together with Father for the rest of his life since then.  It is therefore clear that:

(1) Jennifer did not put her word into action despite what she wrote;

(2) Father must have accepted Thomas subsequently despite his initial concern/objection.

D2.    Jennifer’s relationship with Mother

47.  Michael also described Jennifer’s relationship with Mother as “acrimonious” and a “love-hate” one, and that Mother and Jennifer argued all the time.

48.  Even if Jennifer and Mother might have arguments, the undisputed fact is that Jennifer would call up Mother frequently, at least a couple of times a week, and in those phone calls, they would talk about business in Hong Kong, and their respective daily lives.  Jennifer would also update Mother regarding Raymond and Victor.

49.  In my view, the frequency of the phone calls is the strongest evidence to show that Mother and Jennifer had been very close despite the fact that they were not living in the same city, and that Jennifer had not visited Mother physically for a long time.  In this regard, it must be borne in mind that Jennifer had moved away from Vancouver since around 1979.  In other words, she had not lived with Mother for a few decades.  She could only meet Mother normally during Summer holidays when Mother came to Hong Kong while Raymond and Victor were still small.  Since 2007, she had not met Mother physically at all.  The fact that Jennifer was still having frequent telephone calls with Mother in such circumstances only tends to show that their bonding was really strong.

50.  In relation to the reason why Jennifer did not choose to visit Mother in Vancouver, she explained that was primarily because she did not want to have any argument with Michael or Angela in front of Mother who had heart condition.  She had also given various other secondary reasons for example mobility in the city, etc.  On the other hand, Michael’s counsel put to Jennifer that the reason why she did not go to Vancouver was that she did not want to be confronted by Mother about the UBS Account.

51.  In my view, Michael’s case theory on this matter does not make sense. Jennifer could be confronted by anyone so long as they had had direct conversation.  Hence, if Jennifer was afraid of being confronted by Mother, she would not have called up Mother so frequently.  

D3.    Mother’s relationship with Michael

52.  It is undisputed that Mother favoured Michael.  However, for the present purpose, it should be pointed out that that does not necessarily mean that Mother would have told Michael everything about her assets, for there is no dispute that Mother never told Michael about Father’s Swiss bank account until 2003, and she never told Michael about the transfer of the YSC and Haw Yuet shares to Jennifer in 2006 (see further Section D8 below).

53.  The above shows that even though Michael was Father/Mother’s favourite child, to the extent that he had been named as the sole beneficiary in both Father’s and Mother’s wills made in 1987, that does not mean that Father/Mother intended to give all family assets to Michael, to the exclusion of others.  On this matter, see further Section D5 below.

D4.     Mother’s trait

54.  Having heard the evidence, it occurs to me that Mother was not forthcoming with her children in terms of how she had dealt with her assets. She would even say different things to different child of hers.  As pointed out by the defendants’ legal team, there are many such examples:

(1) One clear example, which I have referred to above, is that even though Mother had transferred the shares in YSC and Haw Yuet in Father’s name to Jennifer and Raymond in 2006, she did not tell Michael about it, and Michael only found this out after Mother’s death;

(2) According to Michael’s evidence, not only did Mother fail to tell Michael about the aforesaid transfers of YSC shares and Haw Yuet shares, she had in fact given some indications to Michael so as to lead him to believe that Mother was still holding the shares;

(3) Another clear example relates to Mother’s setting up of the AET in early 2010.  In the emails between Angela and Jennifer in April 2010, Jennifer referred to the fact that Mother had said to her that she (Mother) did not put the 608 Property (which was then held under the joint names of Mother and Jennifer) into the AET.[4] However, Mother had in fact put the 608 Property into the AET by the trust deed executed on 1 January 2010 already.

55.  Indeed, Jennifer and Angela had by their exchanges of emails complained to each other the fact that Mother had lied.  Those emails are contemporaneous documents and I have no hesitation to accept that those complaints reflect what actually happened and that they were not made up by Jennifer/Angela. 

56.  Jennifer suggested that the reason why Mother would do this was probably because she wanted to avoid a confrontation from a disappointed child, or she might have feared that if Michael and Angela knew that Mother did not own the assets, they would no longer visit or look after her.  This is indeed a sensible guess, though I must say that it is nothing other than a guess.   In any event, the real motivation behind Mother’s behaviour in this regard does not matter.  What is important is that, now that there is a positive finding that Mother had had such behaviour, this Court should be more cautious when considering evidence of what Mother is said to have told Michael, as these statements may not necessarily be true even if such statements had indeed been made as alleged by Michael.

D5.     Father and Mother’s estate and tax planning

57.  It is undisputed that Father and Mother were savvy people, and, as far as estate planning is concerned, they relied primarily on drafting relatively simple wills, and adding their children as joint tenants to various assets of theirs.

58.  As a matter of background, Father and Mother each executed a will in 1970 which mirrored each other.  They named each other as sole beneficiary under their respective wills, but if the other predeceased him/her, the beneficiaries would be Michael (50%), Jennifer (25%) and Angela (25%).  

59.  In 1987, Father and Mother executed new wills, such that if they predeceased each other, the sole beneficiary would be Michael.  The 1987 will was Father’s last will, whereas Mother made another will on 21 August 2002 (which had become her last will), in which she named Michael as sole executor.  Her residuary estate was to be divided into 10 equal shares and distributed as follows: 1 share divided equally amongst Mother’s grandchildren (Raymond, Victor, Angela’s twins and Michael’s two sons), 1 share to Angela, 3 shares to Jennifer and 5 shares to Michael.

60.  It is Michael’s evidence that the children accepted that the addition of names(s) as joint tenant(s) to the parents’ assets was not irreversible or irrevocable, and that they might have to give back assets if Father or Mother required them to do so.  I accept this evidence.  In my view, it is natural and reasonable that it was possible for Father and Mother to change their estate plan during their lifetime.  This is akin to making a new will.  For example, it is undisputed that Michael’s name, which was originally used to hold the Angus Property as one of the joint tenants together with Mother, was taken off shortly before his marriage with Anne, because of his parents’ disapproval of such a marriage.

61.  However, if a child remained one of the joint tenants of a certain asset held by Father/Mother upon his/her death, in my view, that would at least serve as prima facie evidence that it was the intention of Father/Mother that such an asset would then belong to the joint tenant child.

62.  Although Michael at one stage accepted the above proposition while he was cross-examined, he later on supplemented that the situation might be more complicated because one has to take the tax planning scheme of Father/Mother into account.  He stated that the assets out of Canada were the “offshore bucket” which were put under the name of Jennifer (who was a non-Canadian resident) pursuant to the advice given by Mr Noshir Sarkari, the accountant of Father and Mother, in order to take advantage of the favourable tax treatment of non-Canadian residents.  Apparently, Michael’s evidence in this aspect was targeted at those assets which had been put under Jennifer’s (or Raymond’s) name.

63.  In my view, as far as Father’s assets were concerned, the tax advice is irrelevant for our purpose, because it is undisputed that Father himself was also a non-Canadian resident.  Therefore, there was no need for Father to put any of his asset under Jennifer’s name for tax purpose.

64.  Michael’s evidence on tax advice may be more relevant in relation to Mother’s assets.  In this regard, whether an overseas asset held by Jennifer/Raymond was in fact still beneficially owned by Mother is a question of fact which has to be resolved.  I will turn to such a question under different sub-sections below. 

65.  However, what I should make it clear at this stage is that I do not accept the plaintiff’s argument that Jennifer was “cut out” by virtue of Father and Mother making new will in 1987 which named Michael as the sole beneficiary thereof.  This is because it is apparent that both Father and Mother were using both simple wills and arrangements of joint tenancy to distribute their assets.  While they intentionally kept their respective wills simple, I do not consider it probable that they were minded to deprive Jennifer of everything in 1987.  Indeed, although it is undisputed that Father and Mother’s relationship with Angela deteriorated significantly in 1987 when Angela was in a romantic relationship that Father and Mother disapproved of, there is no evidence at all that Jennifer’s relationship with Father/Mother turned sour at around the same time.   This supports a finding that if Father and Mother were minded to pass certain assets to Jennifer at the material time (there is no evidence that they would not be minded to do so), they would have done it by direct transfer or by adding her name as a joint tenant, rather than by way of a will.

D6.    The UBS Account

D6.1  Legal principles

66.  In Poon Loi Tak v Poon Loi Cheung Desmond [2024] 4 HKLRD 611, [2024] HKCA 796, Chow JA was satisfied that the following propositions represent the relevant legal principles concerning how the beneficial ownership of a joint account ought to be ascertained, and how the presumptions of resulting trust and advancement may be utilized to assist in resolving the issue of beneficial ownership:

“(1) The beneficial ownership of the credit balance in a joint account is a question of intention of the joint account holders. […]

(2) If a gift is claimed, the onus is on the donee to prove it. Whilst corroboration is not required as a matter of law, where there is a claim that a gift was made by a person who is now deceased, the court must approach the claim with some caution and a true sense of enquiry.

(3) The fact of being a signatory to a bank account does not, without more, prove beneficial ownership. The matter is to be decided on the facts and intention of the deceased, and on the evidence which establishes what he or she did or said in life.

(4) A presumption of resulting trust arises when the source of monies in a joint account came from only one holder of the joint account. But such presumption is readily displaceable by sufficient evidence of the actual intention of the parties at the time of the transaction.

(5) The presumption of resulting trust could be displaced by the counter-presumption of advancement […]

(6) Nevertheless, the presumptions are not of much value if the intention of the relevant parties can be ascertained from the evidence adduced. In such a case, the utility of the presumptions available at law will be substantially restricted.”

D6.2    The undisputed facts

67.  Father had a bank account (“the Sanwa Swiss Account”) with Sanwa Bank (Schweiz) AG (“the Sanwa Swiss Bank”). 

68.  In around 2002, the Sanwa Swiss Bank’s private banking business came to be operated under the UFJ brand through UFJ Bank (Switzerland) Ltd (“the UFJ Bank”) in Switzerland.  As a result, the Sanwa Swiss Account became an account held with the UFJ Bank (account no.: xxx.xxx/xx.xx[5], “the UFJ Account”).  The UFJ Account was a numbered bank account where the identity of the holder was represented by a number known only to the client and the bank.

69.  In around 2006, as the UFJ Bank was to merge with another bank, Jennifer suggested to Mother that the funds in the UFJ Account be moved to the Singapore branch of UBS.

70.  Jennifer subsequently facilitated and arranged for the funds in the UFJ Account to be moved to a new account at UBS (i.e. “the UBS Account” as defined above) opened under the names of Mother, Jennifer, Michael and Angela.  Jennifer also arranged for all of Mother, Michael, Angela and herself to sign the account opening documentation for the UBS Account.

71.  After the funds previously situated at the UFJ Account were transferred to the UBS Account, Jennifer continued with managing the funds by managing the UBS Account.  Despite the fact that Mother together with all siblings were account holders of the UBS Account (and they were aware of the existence of this account), it was only operated by Jennifer.

72.  Despite requests made by Michael (including requests made in his capacity as Mother’s attorney), Jennifer did not provide details or account statements of the UBS Account to Michael.

73.  Jennifer also said to Michael from time to time that she did not hold any assets on behalf of Mother.

74.  On 2 April 2015, Jennifer withdrew the last remaining balance of the UBS Account in the amount of US$25,142.33, and thereafter the UBS Account had a zero balance.

75.  On around 7 May 2015, the UBS Account was closed by Jennifer.

76.  In around July 2021, Jennifer informed Michael that, after the funds in the UBS Account were withdrawn by her in 2015, such funds were deposited into her personal account held with UBS no. xxxxx[6], and as at July 2021, those funds (and/or their traceable proceeds) were held in another account opened with UBS which is in the joint names of Jennifer, Raymond and Victor (“Ds’ Current UBS Account”).  Jennifer has refused to provide details of Ds’ Current UBS Account to Michael.

77.  The parties are in dispute as to whether, despite the names in which the UBS Account was opened, Mother or Jennifer was the beneficial owner of the funds in the UBS Account, or whether the stated account holders were the joint legal and beneficial owners.

D6.3  The Sanwa Swiss Account

78.  Since it is undisputed that the funds in the UBS Account came from the UFJ Account and in turn the Sanwa Swiss Account, the ownership of the monies in the Sanwa Swiss Account is of utmost importance.  This is particularly so because it is accepted by Mr Pao SC and Mr Chan that if Jennifer was a joint account holder of the Sanwa Swiss Account in law and in equity, then she would become entitled to the funds therein by way of survivorship upon Father’s death. 

79.  It follows that the Court has to decide 2 crucial questions:

(1) Was Jennifer one of the joint account holders of the Sanwa Swiss Account?

(2) What was Father’s intention in respect of the Sanwa Swiss Account?

D6.3.1     Account holder(s) of the account

80.  Jennifer gave evidence that she had been added as one of the joint account holders of the Sanwa Swiss Account:

(1) She first became aware that Father had the Sanwa Swiss Account in around 1980s to early 1990s;

(2) Father had introduced her to Ronald Tsang (“Ronald”), the relationship manager at Sanwa Swiss Bank;

(3) During Father’s lifetime, Father and Jennifer were the only people who operated the Sanwa Swiss Account.  When Father was out of town, Ronald would contact Jennifer about interest rates for renewing the deposits held in the account, and would take instructions from her to execute investment instructions;

(4) After Father’s death, Ronald continued to deal with her as before.  Shortly after Father’s death, Ronald called her and told her that everything would continue as before, and that she would be able to continue to give the bank instructions.  There was no suggestion that the account would be frozen, nor did the bank request for proof that she was authorised to deal with Father’s monies.  The Sanwa Swiss Bank continued to take instructions from her (and her alone) in relation to the investment in the account, such as sending her information about interest rates for deposits; 

(5) Jennifer continued to place the funds in the account with time deposits.

81. Although Jennifer could not locate any relevant bank statement or any other document in respect of the Sanwa Swiss Bank in support of her claim that she was one of the joint account holders, nor could she recall positively that she had signed any form to have her name added to the account as an account holder, I accept her evidence as summarized above and find that she had indeed been added to the account, not only as an authorized signatory, but as a joint account holder. This is because the fact that she was actually allowed by the Sanwa Swiss Bank to operate the Sanwa Swiss Account after the death of Father but before letters of administration were granted in respect of Father’s Estate strongly suggests that she was one of the holders of this account. 

82.  It was argued on behalf of Michael that, given Ronald’s very close relationship with Father who was a high-value client of the Sanwa Swiss Bank, it was not improbable that Ronald would have allowed Jennifer to do something so low-risk as to continue making time deposits with the monies in the account without withdrawing the funds, when technically he ought to have waited until probate had been obtained.  With respect, I reject this argument.  I do not think it was inherently probable that anyone in the position of Ronald would commit such a fundamental wrong simply because he had had a close relationship with a client, despite the fact that the action allowed was a low risk one.  To the contrary, I find that it is highly unlikely that a bank staff would have taken a risk in totally disregarding the mandate.

83.  It was further argued by Michael that since Jennifer had been told by Father to use the funds in the Sanwa Swiss Account if YSC needed funding or there was an emergency, this shows that Jennifer was not free to use the funds as she wished, but only for the purposes as Father indicated, and that Jennifer was only given authorisation to operate the account because she was assisting in Father’s business.  With respect, these arguments do not assist Michael, because the above is consistent with Jennifer’s case that Father remained the beneficial owner of the account during his lifetime and the ownership of the monies would only pass to Jennifer upon Father’s death.

84.  I therefore find that it was more likely than not that Father had indeed added Jennifer to the Sanwa Swiss Account as one of the holders during his lifetime.

D6.3.2      Father’s intention

85.  In support of her case that Father intended to gift her all the monies in the Sanwa Swiss Account upon his death, Jennifer had, in gist, given the following evidence:

(1) Sometime before Raymond was born in 1985, Father told her that the account was “either yours or mine” (“唔係你就我”), and that the funds in the account had nothing to do with those in Canada (“同佢哋加拿大啲人無關”), and were not to be given to them.  At the time, Jennifer was unsure what Father meant by this, but did not feel appropriate to probe (she did not want Father to have the impression that she was after the money or wished that Father would die), and she thought that Father would tell her eventually at an appropriate time;

(2) At the time when Father learnt about Michael’s intention to marry Anne (which was in around 1996), Father made clear to Jennifer that he did not wish any of his assets to go to Michael or Angela if he were to pass away.  In these conversations, Father specifically mentioned the Sanwa Swiss Account, and told her not to tell Michael or Angela that the account was given to her, or anything about the account at all. Father also said that Mother would help Jennifer handle Michael and Angela if there was issue relating to the account.  Jennifer believed Mother knew about this instruction, as she mentioned this after Father’s death;

(3) Ronald had a very close relationship with Father, and Father had told Ronald almost everything about the relationships in the family.  Jennifer believed that Father had told Ronald about his intention regarding the account, including who should inherit it, because she recalled that when she later approached Ronald to add Michael’s name to the account, Ronald himself raised that Father did not want any of his money to go to Michael.

86.  I am of the view that Jennifer’s evidence is credible and I accept the same.  My reasons are as follows.

87.  Firstly, if Father did not intend Jennifer to become the beneficial owner of the account by operation of the right of survivorship, he could have only given Jennifer signing authority for the Sanwa Swiss Account, just like what he did for some of his other bank accounts.  Alternatively, he could have asked Jennifer to execute a trust document – just like what he did in relation to the 1,000 YSC shares which he held on trust for Mother.  In other words, the intention to make a gift to Jennifer is supported by naming her as one of the joint account holders.

88.  Secondly, Father had a close relationship with Jennifer who was his only child who lived and worked with him in Hong Kong. 

89.  Thirdly, Father’s conduct was consistent with his preference of managing his estate matter by way of joint tenancy.

90.  Fourthly, by Father’s new will made in 1987, Jennifer would not be entitled to any part of Father’s Estate.  It is therefore unsurprising that Father would give her something by other means, particularly when Raymond and Victor had been born and it is evident that Father loved them. 

91.  On the other hand, Michael argued that it was unlikely that Father intended to gift the monies in the Sanwa Swiss Account to Jennifer to the exclusion of those in Canada.

92.  First, it was argued that leaving the monies in the Sanwa Swiss Account under the name of Jennifer was consistent with the idea of avoiding Canadian tax. 

93.  As aforesaid, insofar as Father was still alive, there was no need to leave the monies in Jennifer’s name because Father himself was also a non-resident of Canada.

94.  If Father was minded to leave the legal title rather than beneficial interest of the monies with Jennifer only upon his demise, then the question is who the beneficiary of such monies would be.   In my view, in such a situation, Father would have told others in the Mong Family what his intention would be, so that the interest of those people would be protected.  However, there is no evidence that he had ever told anyone about this, not even Michael who was his named sole executor.  Indeed, this is consistent with Jennifer’s evidence that Father had specifically instructed her not to tell Michael about this account.

95.  Second, it was said that there was no reason why Father would want to exclude Michael or Mother from the Sanwa Swiss Account.  I do not accept this argument, for Father had other assets in Canada which could be passed to them if he so wished.  It also seems to me consistent for Father to pass his assets in Hong Kong to Jennifer rather than to those who lived in Canada because that means such assets would then not be subject to Canada tax, which was something which Father had been concerned about given it is evident that he had sought advice on Canada tax long time ago. 

96.  Third, Michael challenged Jennifer’s credibility by saying that it makes little sense that she did not enquire with Father further about why he decided not to leave the monies in the Sanwa Swiss Account to Mother.  In this regard, I accept Jennifer’s explanation that she did not feel appropriate to ask as she did not want Father to have the impression that she was after the money or wished that Father would die, and that she’d rather let Father explain further at an appropriate time.

97.  Fourth, Michael suggested that Father could have ensured that nothing went to Michael or Angela by just paying the monies directly to Jennifer.  With respect, it is unrealistic to say that Father should have given the majority of his assets in Hong Kong away during his lifetime for the purpose of estate planning.  In any event, the fact that Father could have achieved the same purpose (giving Jennifer the monies in the Sanwa Swiss Account) by another way is neither here nor there.

98.  Fifth, Michael emphasized that, according to Jennifer’s evidence, Father did not tell her that she could withdraw monies from the Sanwa Swiss Account after his death.  I am afraid that was a misunderstanding of Jennifer’s evidence.  Jennifer only told the Court that, unlike other accounts in Father’s personal name, Father did not ask her to withdraw the funds from the Sanwa Swiss Account immediately upon his death or when his death appeared imminent.  Since Jennifer’s name had been added to the Sanwa Swiss Account, it is not surprising at all that Father did not give the same instruction in relation to this account for it was unnecessary to do so – Jennifer as a joint holder of the account could withdraw the monies in the account even if Father had passed away.

99.  Sixth, it was also alleged that there is no reason why Father would not want Michael to know about him being “taken off” the Sanwa Swiss Account, if that was in fact the case.  This submission is not understood.  It is evident that Michael’s name was not on the Sanwa Swiss Account and he admitted that he did not even know about its existence by the time of Father’s passing. In such circumstances, it is totally understandable why Father did not want Michael to know about this account.

100.  Seventh, Michael relied on Jennifer’s reports to Mother on the quoted interest rates of the Sanwa Swiss Account, and submitted that Jennifer had done so because she had to inform Mother of what was happening to Mother’s money in the Sanwa Swiss Account.  In this regard, I accept Jennifer’s explanation that she was only seeking help from Mother on the operation of the Sanwa Swiss Account.  It is not surprising at all that Jennifer would do so given her close relationship with Mother who was, as agreed by Michael, a financially savvy person. 

101.  I therefore conclude and find that it was Father’s intention to gift Jennifer the monies in the Sanwa Swiss Account upon his death.

D6.3.3    Conduct after Father’s death

102.  The findings made under Sections 6.3.1 and 6.3.2 mean that Jennifer would become entitled to the funds in the Sanwa Swiss Account by way of survivorship upon Father’s death.

103.  That being the case, and since there is no evidence that Jennifer had any intention to gift the money during her lifetime to anyone else in the Mong Family, what the parties did to the account afterwards would not affect the findings above.

104.  However, looking at the matter from another angle, it may be said that the course of conduct of the parties after Father’s death, including the subsequent conduct in respect of the UFJ Account and the UBS Account, may shed light on the question of whether Jennifer had really become the sole beneficial owner of the funds in the Sanwa Swiss Account upon Father’s death.

105.  I would therefore also look into a few particular areas focused by both legal teams. 

106.  It will be seen that the above factual findings are consistent (or at the very least not inconsistent) with the subsequent conduct of the parties.

D6.3.3.1   Adding Mother’s and Michael’s names to the account

107.  The first matter concerns Jennifer’s addition of Mother and Michael’s names to the account.

108.  According to Jennifer’s evidence:

(1) Shortly (about a few months to a year) after Father’s demise, she proposed to Mother to add her name to the Sanwa Swiss Account.  She suggested this because she considered these funds to have come from Father, and if she should die early, she wanted the funds to be passed back to her maiden family, with the understanding that they would take care of Raymond and Victor.   She therefore wished to pass the account through the device of a joint account by adding Mother’s name to it.  She did not want to put his husband as the account holder, because she thought he was not good with managing finances;

(2) There was an ongoing discussion with Mother.  Despite Mother’s initial resistance for the reason (as Mother said) that she had no interest in the money and did not want to have anything to do with it, Mother eventually agreed to Jennifer’s proposal;

(3) During the course of the discussion, Mother raised that, since she was getting old, it might not be a good idea to add her name.  This eventually led to Jennifer suggesting to add both Michael and Angela’s names to the account as well, so as to achieve the same purpose. Mother was open to adding Michael’s name, but not Angela’s.  As Jennifer was aware of the strained relationship between Mother and Angela at the time, she did not press Mother on it;

(4) Jennifer also explained that she would discuss these matters with Mother and seek her agreement because she felt conflicted by, on one hand, Father’s express instruction that he did not wish the account to go to Michael or Angela (an intention which Mother was aware of), and on the other hand, she felt awkward for being more favourably treated by Father and therefore wanted to share some money with Michael and Angela.  She wanted Mother’s blessing so she would feel better for not abiding with Father’s instructions;

(5) Jennifer did not communicate directly with Michael about adding his name to the account, and relied on Mother to inform Michael and explain her thinking behind.  This was because:

(a) Jennifer was not on very good terms with Michael and rarely spoke to him;

(b) she also felt awkward to say to Michael herself that Father had treated her more favourably, which might also lead to a confrontation;

(c) Father had told her not to tell Michael about the account;

(d) Father also told her that Mother would assist her to deal with Michael;

(6) Although she was not on good terms with Michael, she nonetheless felt that she could rely on him to take care of Raymond and Victor because Michael had a good relationship with them;

(7) As Mother had agreed to explain to Michael, Jennifer believed that she had done so accordingly and that Michael had agreed to Jennifer’s proposal (although she could not recall any specific conversation), because otherwise Michael’s name would not have been added;

(8) One time Mother and Jennifer went to see Ronald together and Jennifer asked Ronald to prepare documents so that Michael’s name could be added to the account.  Ronald then said that Father had told him that Father was very disappointed by Michael’s decision to marry Anne, and did not want any of his money to go to Michael;

(9) Sometime in 2003, Mother, Michael and Angela visited Hong Kong together and there was a meeting with Ronald, arranged by Jennifer.  During the meeting, there was an emotional argument between Angela and Mother because Angela realised that Mother had no intention of adding Angela’s name to the account.  Angela was so upset by this incident that, in emails shortly thereafter, she suggested that she might have to cut Mother out of her life;

(10) After their names were added to the account, it remained the case that Mother and Michael had no involvement whatsoever in dealing with the bank in relation to the account.  Jennifer would sometimes show Mother the bank statements of the account when the former visited Hong Kong, because Mother would need to know the bank, the account number and bank balance.  However, Jennifer would tell Mother not to take the statements back to Vancouver to avoid any risk of being questioned by the tax authorities.

109.  On the other hand, Michael told this Court that:

(1) He first knew about the account by the time of the meeting with the bank in 2003;

(2) He had been told by Mother that:

(a) the account previously belonged to Father, and was passed on to Mother after Father passed away;

(b) Jennifer had access to Father’s Swiss bank account because she lived with Father in Hong Kong and assisted in Father’s business affairs;

(c) Jennifer was given such access to operate the Swiss bank account for Father’s benefit only;

(d) the arrangement continued after Father passed away, and Jennifer was operating the account for Mother.

110.  As far as what Michael had been told by Mother is concerned, as explained in Section D4 above, this Court has to be more cautious when considering evidence in this aspect because it is evident that Mother had the history of saying different things to different child of hers. 

111.  I therefore would not place much weight on what Michael had been told by Mother.

112.  The remaining question is whether Jennifer’s evidence in this regard should be accepted by the Court.

113.  Michael submitted that Jennifer’s account of events is, to say the least, inherently improbable.  I will consider his submissions below.

114.  Firstly, it was submitted that Jennifer’s evidence is unreliable because while she initially confirmed twice in Court that she had actually explained the reasons set out in paragraph 128 of her witness statement to Mother, she later on (when pressed as to whether she actually remembered specifically discussing with Mother that she did not want the money to go to Thomas) stated that she could not remember.

115.  With greatest respect, I do not think he is entitled to make this argument.

116.  The relevant questions and answers of the cross-examination are as follows:

“Q:		Now, you say in your witness statement at paragraphs 128 to 129, in particular can I invite your attention to paragraph 128. This is not long after father’s passing, and you say your impression is that this was a few months to a year afterwards.  You spoke to mother and suggested her to add her name to the Sanwa Swiss Account.  You see that?
A:		Yes, I see that.
Q:		Now, you then provide a reason, and the reason you suggested was because you considered these funds to have come from father, and if you should die early, “I wanted those funds to be passed to my maiden family, with the understanding that they would also take care of my sons.” Do you see that?
A:		Yes.
Q:		Now, a first question to you is: When you spoke to mother on this occasion, did you explain the reasons stated in paragraph 128 to your mother or not?
A:		Yes, I did.
Q:		You did explain this reason to your mother?
A:		Yes, I did.”

117.  While Jennifer did explain in paragraph 128 of her witness statement as to why she did not want to put Thomas as an account holder, the questions which were asked (as quoted above) were apparently focused on the reason for adding the names of Jennifer’s maiden family members, rather than not adding Thomas. There was no inconsistency in her evidence as alleged.

118.  Secondly, it was submitted that there is no apparent reason why Jennifer should have been concerned about the prospect of dying early, and in any event, there is no reason why Jennifer would have thought that Mother would be likely to be around longer than Jennifer herself. These, it was said, undermine the credibility of her entire story about adding the names to the account.

119.  I do not accept this argument:

(1) It is apparent that Jennifer’s proposal was made as a precaution for unexpected eventualities.  This has nothing to do with Jennifer’s age;

(2) It is also entirely logical and understandable why she thought it was necessary to take such a precaution, taking into account the incidents which she and Father had encountered before: (1) in around 1979/1980, Father and Jennifer had a trip to Australia and Father had a serious asthma attack; (2) on their return flight, the plane had an emergency landing, and they later learned from the news that there was a threatened hijack.  As a result, after the trip, Father and Jennifer were quite shaken up and had talked about what if something happened to them.  Although these incidents happened a long time before the addition of names, it should be borne in mind that the necessity to consider taking precautionary action in relation to the account did not arise until Father’s demise;

(3) There was nothing incredible to add Mother despite her much older age than Jennifer, because, as mentioned, this measure was to cater for any unexpected events which might happen to Jennifer.  This is particularly so when Mother was still going strong at the material time;

(4) Importantly, this matter had been considered at the material time.  In paragraph 130 of Jennifer’s witness statement, she explained that:

“I also recall that in the course of our discussions, Mother once mentioned that she was getting old, and for this reason, it might not be a good idea to add her name to the account – the implication being that she might very well pass away before I did. I believe that this led to further discussions, which resulted in me suggesting to Mother to add both Michael [and] Angela to the Account as well, so that they could perform the same function as explained in paragraph 128 above as Mother if both Mother and I were to pass away before them. I recall that Mother was open to the idea of adding Michael’s name, but did not agree to adding Angela’s name. I did not press the matter regarding adding Angela’s name as I did not want to argue with Mother, and I was aware that this was a thorny issue because Mother and Angela were not on good terms.”

120.  Thirdly, following on the previous argument, it was submitted that it made no sense for Jennifer to approach Mother first.  It was further said that the reason why Jennifer talked to Mother first for this purpose simply because Mother was the beneficial owner of the funds.

121.  This submission was made in disregard of Jennifer’s evidence (which I accept) that Father had instructed her not to give Michael any money in this account.  It was therefore understandable why Jennifer turned to Mother right away when she had this idea.

122.  On this matter, Michael said it is unbelievable that Father had ever given instruction not to tell Michael about the account.  With respect, I disagree.  As explained, I am of the view that the fact that Michael had been kept in the dark by both Father and Mother on the existence of the account until 2003 is a very important matter which should be borne in mind, and Jennifer’s evidence on Father’s instruction is amply corroborated by this undisputed fact.

123.  Fourthly, Michael submitted that Jennifer’s explanation as to why she did not wish to add Thomas to the account does not bear scrutiny.

124.  Without disrespect to counsel, I do not intend to go into the details of Michael’s arguments in this aspect.  It suffices for me to say that Jennifer’s evidence that Thomas was not interested in money and that he was not good in handling money matters is well supported by Raymond, who testified in Court that he was surprised how small Thomas’ estate was when he dealt with Thomas’ probate.  As Thomas’ wife, Jennifer would be in a position to know Thomas’ ability in handling money matters even before 1997/1998, as they had got married since 1983.

125.  Moreover, it should also be borne in mind that Jennifer’s intention was to give the monies in the account (the entirety of which came from Father) to her maiden family.  Viewed in this light, it is natural that only the names of her maiden family members were added.

126.  In his argument, Michael also drew this Court’s attention to Jennifer’s evidence in the Trustee Action in this regard.  He submitted that:

“Moreover, it is notable that Jennifer’s explanation in the Trustee Action was different. She did not give any examples of Thomas being unable to manage money, and merely asserted that Thomas ran a small business, was very busy with his work, and was not interested in investments, so that “there’s no point giving him money to invest”. Instead, she claimed that Father was worried that Thomas would re-marry, but upon further questioning by Canadian counsel, she admitted that she had not talked to Father about Thomas re-marrying (an explanation that she did not repeat in the present proceedings).”[7]

127.  Again, Michael is not entitled to make these submissions, because there were the following questions and answers in the cross-examination of Jennifer in the Trustee Action:

Q:		[…] Now let’s look at estate planning.  The idea was that if you died first, your children would go to Canada.  Your mother would take care of your children – or your parents would take care of your children, right?
A:		Correct.
Q:		You said your husband – or I’m not sure if you said this, but I believe your husband Thomas was aware of that plan.  And Thomas’s family lives in Vancouver, right?
A:		That’s true.
Q:		You had no discussion or thought of giving the funds to Thomas to help take care of the children, did you?
A:		Thomas does not manage money, so I didn’t want to give him the burden of having to deal with such a large amount of money.  He would have to invest it and all that, so I wanted my mother to do it.  And I think that was the original plan that my father and my mother and I had talked about it during my father’s lifetime. It was when I was first put on joint with my father.[8]
		[…]
Q:		But, Ms Mong, a moment ago you said one of the things your father was concerned about was that Thomas may remarry after you die.  That’s true, isn’t it?  He was worried about that.
A:		Well, the biggest problem is Thomas does not manage money.  I’ve said this first of all.  Thomas does not know how to manage large amounts of money. He runs a small business, a one man clinic.  He’s very busy with his work, and he does not really – he’s not interested in investments I would say.  So there’s no point giving him money to invest.”[9]

128.  It can therefore be seen that Jennifer did explain in the Trustee Action that Thomas was unable to manage large amount of money.  Insofar as it is said that Jennifer did not give any example in support of Thomas’ incapability in managing money in the Trustee Action, the short answer is that she was not asked to give any example on this matter in the Canadian proceedings. Therefore there is nothing in this point.

129.  Michael further pointed out that Jennifer did not repeat her reason in the present case regarding Father’s concern that Thomas might re-marry if she died early.  This submission is not understood.  This is because the focus of this part of the cross-examination in the present case is the reason given by Jennifer to Mother as to why she would like to add Mother’s name to the Sanwa Swiss Account.  The subject matter is quite different.

130.  Fifthly, Michael argued that if Jennifer’s concern was that there should be money available to take care of her children after her death, that would not require her to leave her funds to Mother by adding Mother’s name to the account. On the contrary, Jennifer accepted in cross-examination that Mother would have offered to help from her own funds and from her own volition, even if she had not been added to the account.

131.  I do not accept Michael’s logic which is against Jennifer’s intention to use the monies in the Sanwa Swiss Account for her children.  Further, although Mother had her own money, that does not mean that a child in the position of Jennifer would or should think that it was right for her to abuse Mother’s love towards Raymond and Victor and totally rely on her to support her grandchildren with her own resources, particularly when Jennifer had the resources herself.

132.  Moreover, no matter what, the funds in the Sanwa Swiss Account had to be handled upon the passing of Jennifer.  Jennifer explained that, like her parents, she did not want to rely too much on will to deal with her estate. She’d rather adopt the method of joint tenancy.  I accept her evidence.

133.  Sixthly, it was submitted that Jennifer’s evidence as to why and how she added Michael to the account defies common sense and inherent probability.

134.  I do not think so:

(1) Although Jennifer had not been on good terms with Michael, it is evident that he had had a good relationship with both Raymond and Victor.  It is therefore not surprising that Jennifer would entrust Michael to use the money in the account for the purpose of taking care of her children in the event she passed away early unexpectedly;

(2) It is also credible that Jennifer still treated Michael as her brother. Having said that, that does not mean that Jennifer would speak to Michael directly about the account.  As she explained, it was Father’s direction that she should not speak to Michael about the account and should rely on Mother to do so, which direction Mother also repeated.  Further, at the material time, they had not reconciled.  It is therefore understandable that Jennifer did not talk to Michael about the account directly;

(3) Although Jennifer could not recall any specific conversation with Mother in which Mother told her that Michael had agreed to the basis for adding his name to the account, I do not think the Court should put too much weight on this, given the long lapse of time.  On the other hand, I accept Jennifer’s evidence that Mother had probably told her about it because otherwise Michael’s name would not have been added at all;

(4) Michael had over-emphasized the “Anne Factor” (that means the argument that Jennifer would not have agreed to pass her money to Michael since she disliked Anne, as the money passed to Michael might end up in Anne’s pocket). One must bear in mind that we are considering the inter-personal relationship between siblings.  In such a situation, it is not always appropriate to analyse their relationship strictly by logic;

(5) The reliance of Michael on Jennifer’s evidence that Mother was present when Jennifer asked Ronald to prepare the documents to add Michael’s name for the purpose of showing that Mother was the beneficial owner of the account is futile:

(a) even though Jennifer could not be sure now, she said this might well be the same occasion when Mother completed the procedure.  If that was indeed the case, then it explains why Mother was there;

(b) as Jennifer explained, there were only 2 possibilities – either Mother and Michael were added at the same time, or Mother was added first before Michael’s name was added.  In other words, if the names of Mother and Michael were not added at the same time, then by the time Michael was added, both Jennifer and Mother were account holders.  In such a case, it is natural for both of them to be present when the instruction to add Michael was given.  That does not shed light on the beneficial ownership of the account;

(c) as Jennifer was also present on the occasion, it can equally be said that it is consistent with the notion that Jennifer was the beneficial owner of the account;

(d) In any event, it is undisputed that Ronald had known Father and Mother for a long time.  One really should not read too much into the fact that Mother went to see Ronald together with Jennifer when Mother was coincidentally in Hong Kong at the material time.

135.  Seventhly, Michael submitted that Jennifer’s explanation as to why she had to seek Mother’s permission to add Michael and Angela to the account is unconvincing.  It was also said that Jennifer’s explanation was contrived, complicated and inherently improbable.

136.  Michael’s submissions are rejected for the following reasons:

(1) It has been explained time and again that we are dealing with disputes among family members.  When considering factual issues arising in such cases, it should always be borne in mind that the inter-personal relationships among different family members may indeed be complicated and not easy to understand. Their conduct may be affected by emotions and feelings, and as a result, may not be appropriate to assess by reference to totally logical thinking as if they are business partners;

(2) Understood thus, there is nothing incredible in Jennifer’s evidence which I accept;

(3) The fact that there were other ways which Jennifer could have used to achieve the same purpose is neither here nor there.  The question is whether Jennifer’s chosen way is so unreasonable in the circumstances that it cannot be believed.  The answer is “no”;

(4) There is nothing wrong nor suspicious for Jennifer to respect Mother such that she did not press Mother when the latter refused to add Angela’s name.  To the contrary, it is entirely reasonable for Jennifer not to insist on adding Angela’s name given the relationship between Mother and Angela at the time.

137.  Lastly, it was submitted that Jennifer’s evidence that Mother repeatedly refused to agree to Jennifer’s proposal to give some money in the account to Michael is incredible, in the circumstances where Mother always favoured Michael and did not blindly follow Father’s wishes.

138.  With respect, this submission had been made in total disregard of the relationship between Father and Mother which is evidently very close.  On my part, I find that it was natural and totally believable for Mother to follow Father’s instructions.  It should be borne in mind that the account originally belonged to Father, and the monies had never been given to Mother.  It therefore totally made sense for Mother to respect Father’s decision on how such an account should be handled.

139.  To conclude, the fact that Mother and Michael’s names had been added to the account cannot assist Michael in the present case.

D6.3.3.2    Meeting in 2003

140.  Jennifer admitted that:

(1) Sometime in 2003, Mother, Michael and Angela all visited Hong Kong together and they attended a meeting at the bank with Ronald which was arranged by Jennifer;

(2) At this meeting, Mother was the one who did the talking and imposed her will on the issue of whether Angela should be added to the account.  Jennifer simply “kept quiet” and “laid low”;

(3) Mother was the person who ultimately made the decision not to add Angela to the account;

(4) During the meeting, there was an emotional argument between Angela and Mother because Angela realised that Mother had no intention of adding Angela’s name to the account.  In fact, Angela was so upset from this incident that, in emails shortly thereafter, she suggested that she might have to cut Mother out of her life.

141.  It was submitted on behalf of Michael that the most natural inference of the above is that Mother was the owner of the funds in the account, and that it was because of this that she was the one who did the talking, who decided whether Angela could attend the meeting with the banker, and whether Angela should be added to the account.  

142.  It was further said that if that had been Jennifer’s own money, and that if she truly felt conflicted about wanting to give Michael and Angela some of the money, it is completely incredible that Jennifer would not have spoken up at all in favour of her sister.

143.  I do not accept Michael’s arguments, because such arguments are at odds with Jennifer’s explanation which I accept, namely, Father had told Jennifer that Mother would deal with Michael and Angela, and therefore it is reasonable that Jennifer would follow this instruction.

144.  One must also bear in mind that this meeting was held upon the background of Jennifer making some contingency arrangement in case she suddenly passed away while Mother was still around, and if such unfortunate event really happened, Mother would of course be the one who would take charge.

145.  The conclusion is that this episode is not inconsistent with the money in the account being Jennifer’s money.

D6.3.3.3    Opening of the UBS Account

146.  It is undisputed that the money was subsequently moved to a newly opened account with the UBS Bank (i.e. the UBS Account).

147.  Michael relied heavily on Jennifer’s email dated 1 January 2006 which was intended to be read by at least Michael and Angela and submitted that this email undermines her case that she was sole owner of the funds.  The email reads:

“Dear Everyone,

[…]

As I was trying to explain to mother this morning, our Japanese Bank UFJ has merged with Mitsubishi Bank and in the merging there will only be one Swiss bank and the guy will be stationed in Switzerland with no representative office in HK.  I don’t think this is a good idea for us to deal with a distant banker as there would be no room for negotiation on terms.  I have a friend who is a director at UBS and I have spoken to her briefly […]

We could leave the money in the HK branch of the new joint venture bank which does not take a commission but then the names would be exposed. UBS does not take a commission and strictly speaking if checked they will need to expose the names to the authorities but according to my friend that is rare unless money laundering and that type of stuff is involved. She suggest keeping the money in Singapore to distant it from HK. In fact, the Japanese Swiss bank is currently putting money in Singapore as the rates are better than Europe. […] I have spoken to our Japanese banker who invited you to dinner mother and he said he would try to see if the guy from Switzerland can meet me in London or HK. I think both mother and I agreed that we would rather go to a safer and more reputable bank even though they may be abit lower in rates. Mother would like to have all our names on it. Perhaps you all can have a discussion as to whether you agree to this arrangement and then I will have the blank forms sent over. I would like to have the money transferred by early Feb when it matures so we need to act fast. Mother and I also discussed about a trust which I hope Angie and Raymond can give us some advice but this could be arranged at a later date.

[…]”

148.  Firstly, Michael stated that this email indicates that Mother had the final say about what was going to happen to the funds.

149.  I do not know why Michael would have got this impression.  That is not my reading of the email, which only shows that Jennifer had had a discussion with Mother and as a result they had agreed on certain approaches as to how to deal with the account. 

150.  Secondly, Michael challenged Jennifer’s credibility by saying that she had changed her evidence: she initially claimed that it was due to Angela’s concern that the Canada Revenue might think she was evading taxes, although upon being pressed further, she changed her answer to say that it was the tax concerns of “all the Canadians” (not just Angela).

151.  Properly understood, Jennifer’s evidence did not change at all.  It was all along her evidence that only Angela had expressly raised her concern about the possibility of being suspected by the Canada Revenue for tax evasion, whereas in fact all Canadians from the Mong Family would have this kind of concern even though they did not expressly raise it.

152.  Thirdly, it was submitted that if it was true that Jennifer (a non-tax resident of Canada) owned all the monies, then there would not actually be any tax consequences for the Canadian tax residents merely by having their name on the account.

153.  Insofar as it is Michael’s argument that there should be no concern on the part of Mother, Michael and Angela given there would not be any tax consequences for them anyway, I am afraid he had looked at the matter in a too simple (if not naive) way, because “being suspected of tax evasion” is obviously a matter which is serious enough to cause concern.

154.  Fourthly, it was suggested that Jennifer had no sensible explanation as to why they could not have informed the Canadian authorities in advance that all the monies in the account belonged beneficially to herself, to obviate any risk of unwarranted investigation.

155.  It was submitted on behalf of Jennifer that such a suggestion is laughable and that it not only would not pre-empt unwarranted investigation but also trigger it.  I respectfully agree.

156.  Michael then turned to the account opening form and alleged that this form supports his case because it was stated therein that all four account holders were beneficial owners of the account.

157.  In this regard, Jennifer did explain (and I accept) that she had probably informed Stella Lam of UBS that she was the real owner of the funds in the account to be opened, and it is possible that the latter was willing to bend the rules for her in this regard. 

158.  In any event, the said statement on beneficial owner is also inconsistent with Michael’s primary case that the monies belonged solely to Mother.  Hence, this argument in my view does not assist Michael.

D6.3.3.4    Operation of the UBS Account

D6.3.3.4.1 Single signatory

159.  It is undisputed that it was provided in the mandate that a single signatory would be sufficient to withdraw funds in the UBS Account.

160.  It was submitted on behalf of Michael that if such very substantial amount of money really belonged solely to Jennifer, this arrangement would make very little sense, and she would have thought it risky to allow a single signatory to withdraw the monies, particularly given her dislike and distrust of Michael and especially his wife Anne.  It is also incredible for her to assert that she trusted them.

161.  With respect, I do not accept Michael’s argument.  If Jennifer trusted that Michael would look after her children in the event of her unexpected passing, it would be equally credible that she would not worry that Michael would simply withdraw all the monies and then run away. 

162.  Furthermore, it is evident that Michael did not even know at the time that he could withdraw all monies therein with his own signature only.  There is thus nothing in this point.

163.  Another argument made by Michael is that the much more likely situation is that Mother did tell Jennifer that she wanted two signatories to be required, but that Jennifer refused to comply, as she wanted easy access to the money.

164.  Again, with respect, this argument must be rejected.  If that was indeed what happened, it would be very strange that Mother had never taken issue on this matter – In my view, there is no doubt that Mother knew all along that Jennifer had been able to operate the UBS Account with her own signature alone, and that means she knew that one signatory would be enough to operate the account.  It is more likely than not that Mother was totally content with this arrangement because there is no evidence that she had ever complained about this.

D6.3.3.4.2 Actual operation of the account

165.  In the previous sub-section, I have found that Mother must have known that a single signatory would be enough to operate the UBS Account. 

166.  In other words, given she knew that she was one of the account holders, she must have known that if she wanted to withdraw any money from the account, or if she would like to operate the account in any way, she was free to do so.

167.  However, it is undisputed that Jennifer was the only person who actually operated the account. 

168.  This is more consistent with the Jennifer’s case, namely, that she has always been the sole beneficial owner of the UBS Account.

169.  It may also be recalled that it is undisputed that Michael had requested (including requests made in his capacity as Mother’s attorney) Jennifer for details or account statements of the UBS Account, which Jennifer had totally ignored. If those requests were indeed wholeheartedly made by Mother (in other words, if she was really eager to know more about the account), she could have written to the UBS and asked for the information, or alternatively, told Michael about the single signatory requirement, and instructed him to ask UBS for the information.  Nothing of that sort happened.  That shows that either Mother had never instructed Michael to ask Jennifer for the information, or while she did give such instruction to Michael, she was just pretending in front of Michael and acted as if she would like to have more information when in fact she was not really interested in getting the information.

D6.3.3.4.3 Visibility over the account by Michael and Angela

170.  It appears that Michael also complained that Jennifer did not want Michael and Angela to have so much visibility over the account, and that is why Jennifer told Mother to rip up the bank statements and not bring them back to Vancouver, and why Jennifer repeatedly refused to answer Michael’s queries about the account.

171.  I do not understand how this would assist Michael’s case, because his primary case is that he did not have beneficial interest in the monies.  In fact, to the contrary, this is more consistent with Jennifer’s case that the monies belonged to her solely.

D6.3.3.4.4 Usage of the funds in the account

172.  Michael pointed to the evidence of Jennifer who stated that she did not withdraw or use any of the funds in the UBS Account, and that when she subscribed for IPOs she deposited HKD funds into the UBS Account and withdrew them afterwards.  It was argued that this is a factor which strongly suggests that Jennifer knew those funds were not hers to use, and that they were funds belonging beneficially to Mother.

173.  I can deal with this point quickly, because apart from the fact that Jennifer had offered a credible explanation as to why she did not use the US Dollars in the account for payments in HK Dollars, it is undisputed that Mother had never used (or attempted to use) the funds in the account either. Therefore, as submitted by Jennifer’s counsel, this point is at best neutral.

D6.3.3.5    Closure of the UBS Account

174.  As mentioned, on 2 April 2015, Jennifer withdrew the last remaining balance of the UBS Account in the amount of US$25,142.33, and thereafter the UBS Account had a zero balance.  She then proceeded to close it altogether on around 7 May 2015.

175.  It appears that there is no dispute between the parties that the closure of the UBS Account had something to do with the bank’s requests for passport information of certain account holders.  The question is whose information UBS was asking for at the material time. 

176.  In this regard, Jennifer’s case is that UBS reached out to her and asked for passport copies for all account holders due to enhanced “know-your-clients” requirements.  She was informed that the account would be frozen if such documentation was not provided.  Jennifer first told Mother about this, but the latter refused to provide such documentation.  She then reached out to Michael and Angela.  Since neither did they provide the documentation in the end, Jennifer withdrew the money from the UBS Account and closed the account.

177.  As for the way of reaching out to Michael, Jennifer stated that she had called him up on 9 December 2014.  According to her, this call lasted for 47 minutes, in which the passport requirement was conveyed to him.  Both Raymond and Victor were on the call, and Raymond did most of the talking. The call had taken so long to finish because Michael had talked about an amnesty programme of the Canadian government regarding failure to report foreign assets at length.

178.  On the other hand, Michael denies that Jennifer had informed him about the passport requirement, and says that he did not know about the closure of the UBS Account at all.  As far as the call on 9 December 2014 was concerned, he gave evidence that the call was solely about the care of Mother, which was necessitated by the sudden departure of Mother’s caregiver, which led to the removal of Mother into an assisted living residence (Chalmers Lodge) (“the Chalmers”) on 7 December 2014.

179.  With respect, I do not think much time should be spent by this Court on the factual disputes surrounding the phone call on 9 December 2014, because I do not think it would at the end of the day shed much light on the issue of beneficial ownership of the UBS Account. 

180.  Having said that, insofar as it is necessary, I find that it is more likely than not that Jennifer’s version of event is the truth, as it is well supported by Raymond whom I find to be a credible witness.  In this regard, it should be noted that Raymond had no involvement in Mother’s care arrangements at all.  Therefore, if the call was about such arrangements, Raymond would not have been brought in. 

181.  Furthermore, it is undisputed that Jennifer did tell Angela by an email dated 25 November 2014 about the passport requirement imposed by UBS.  In this email, Jennifer wrote that:

“[…] Right now, I have a bigger headache with the bank as they want everyone’s passport copy. That’s why I want to talk to you.”

(emphasis added)

182.  3 points can be made here:

(1) If Jennifer had to tell Michael about the passport requirement, then they had to communicate.  Apart from the phone call on 9 December 2014, there is no evidence that they had communicated in any other way in which they had discussed about the requirement;

(2) More importantly, the contemporaneous email sent by Jennifer referred to the fact that “everyone’s passport copy” was required.  This is a piece of evidence which the Court should attach heavy weight;

(3) If Jennifer was not minded to ask Michael about the passport copy, she would not have any “headache” at all.

183.  If, as contended by Michael, Jennifer had used the pretext of UBS’s request for updated passport information to close the UBS Account and seize control of the monies, she did not have to tell Angela and Mother about the passport requirement at all. 

D6.3.3.6    Mother’s conduct

184.  Generally speaking, I also hold the view that Mother’s conduct tends to support Jennifer’s case:

(1) As aforesaid, Mother never contacted the banks to ask for information when she allegedly really wanted such information while Jennifer refused to provide the same;

(2) She had never demanded Jennifer for the money back;

(3) There is no evidence that she had had any frequent contact with the bank relationship manager on the operation of the accounts;

(4) When Mother made her will in 2002 and when she prepared the AET in 2009/2010, she was assisted by professional advisors.  Michael was also involved in the giving of instructions by Mother on both occasions – he was present on some of the early-stage discussions with the advisors, and helped Mother write down her assets, and fill in questionnaires including information about her assets.  Such would be occasions where Mother had to list her assets in order to get advice from her advisors.  Yet, she had never mentioned about the UBS Account to her advisors;

(5) According to Michael, since around 2005, Mother had decided that she wanted to, and she was keen to, declare her overseas assets to the Canada tax authority.  With that mentality, there was no reason for Mother not to tell her then advisors about the UBS Account, if the money in the account really belonged to her beneficially.  On this matter, it would be worthwhile to repeat the finding above that if Mother was minded to obtain information about the account for this purpose, she could have achieved that easily by approaching the bank directly;

(6) Even if Michael’s clarification that Mother only started thinking about reporting all her overseas assets to the Canadian tax authority in 2005, and did not take the matter of reporting more seriously until around 2010, the fact is that Mother did not pass away until 2017.  However, Mother still did not report the UBS Account in those 7 years.

185.  I have not forgotten Michael’s evidence that Mother had told him that the funds belonged to her.  However, as explained above, it is my finding that even if Mother did say that to Michael, she did not really mean it.  She only somehow wanted to avoid argument among her children by misrepresenting the situation to Michael.

D6.3.3.7    Email exchanges between Jennifer and Angela

186.  Lastly, Michael relied on quite a number of emails which Jennifer sent Angela, and in which Jennifer had given Angela an impression that the money in the UBS Account belonged to Mother who would have the final say on the account, or that Jennifer needed Mother’s agreement regarding the account.

187.  Without disrespect to counsel, I do not intend to go through the emails one by one, save to say that I have read each and every one of them, and accept Jennifer’s explanation that:

(1) She all along wanted Angela to mend her strained relationship rather than cutting ties with Mother.  She did not want them to argue so often, as such arguments would not be good for Mother’s health.  Thus, by saying things to lead Angela to think that Mother had a say in the account, she hoped that Angela would think of Mother in a better light if she knew Mother had agreed to give some money to Angela by adding her name to the account, and motivate her to improve her relationship with Mother;

(2) It was in fact true that Mother did in a sense had a say in relation to the UBS Account, because it was Father’s instructions that the funds in the account should not be given to Michael or Angela, and that Jennifer should not tell them about the account.  As a result, Jennifer would like to have Mother’s approval or blessing in a moral sense for her dealings in the UBS Account which were not consistent with Father’s instructions.

188.  When considering the content of the emails exchanged between Jennifer and Angela, it is important to bear the family dynamics in mind.  I have touched upon this in section C1 above and I do not propose to repeat the same here.

D6.4    Conclusion on the UBS Account

189.  To conclude, I find that Jennifer is the sole beneficial owner of the money in the UBS Account.

D7.    Estate Management Funds

D7.1  Introduction

190.  Before Father’s passing, Jennifer had access to certain bank accounts of Father.

191.  It is undisputed that a sum of not less than US$600,000 was taken by Jennifer from a personal account of Father at Sanwa Bank Hong Kong (which total has been defined by the Parties as the “Estate Management Funds”) shortly after his death, without payment of any consideration.  Jennifer placed those funds in a fixed deposit in Chekiang Bank in her own name, used some of the funds for funeral expenses and taxes of Father, and then spent the rest as her own monies. 

192.  It is Jennifer’s case that Father had given standing instructions for her to immediately withdraw funds from his bank accounts if he passed away or if his death appeared imminent, and that such monies would belong to her.  Further, Mother was aware of and agreeable to this.  It was under these circumstances that Jennifer withdrew the funds upon Father’s death.

193.  On the other hand, Michael’s case is that Jennifer had access to Father’s bank accounts only to support him in managing his business affairs in Hong Kong by operating the accounts on his instructions, and that she had no beneficial interest in the monies therein.  When Father passed away, Jennifer had received the Estate Management Funds without paying any consideration, and therefore has to repay the same to Mother or Mother’s Estate (which is beneficially entitled to such funds).

D7.2  Jennifer’s evidence

194.  Jennifer’s evidence in relation to the Estate Management Funds may be summarized as follows[10].

195.  After Jennifer returned to Hong Kong, she was given signing authority in relation to some of Father’s personal accounts, and Father told her on several occasions that:

(1) He gave Jennifer such authority because he was always worried that he might pass away unexpectedly, and he instructed her to immediately withdraw funds from his bank accounts should he pass away or his death appeared imminent;

(2) Such funds should be used to pay for his funeral expenses, estate duty and other related expenses;

(3) As Father told Jennifer, his worry was that the accounts would become frozen if the bank learnt of his death and it would not be possible to use the funds for such expenses;

(4) She could keep the remainder of the funds afterwards.

196.  Not long before Father’s death, he took Jennifer to Sanwa Bank Hong Kong, and told the banker that if Jennifer came to him one day to ask for the money, he should give the money to her right away.

197.  Father had also asked YSC’s office accountant Mr Lee to write down a list of all Father’s accounts (account numbers and balance thereof), and he had given instructions on what should be done if anything was to happen to him, and that was the more important reason for him to give signing authority to Jennifer over his accounts. 

198.  Jennifer believes that Mother was aware of such instructions from Father, because:

(1) Jennifer recalls that Mother was present on some of the occasions when Father gave the above instructions to Jennifer, although she cannot now recall any specific occasion;

(2) Mother did not act surprised when Jennifer mentioned about such instructions after Father passed away in 1997;

(3) Mother told Jennifer to follow those instructions, and to do what Father told her to before she went to Hawaii;

(4) Mother also told Jennifer that she should keep the balance as this was what Father intended.

199.  Jennifer did follow the aforesaid instructions of Father, and as a result she had withdrawn money from Father’s account within the 2 – 3 days after Father’s death and before she flew to Hawaii.

200.  After Jennifer came back to Hong Kong, she was heavily involved in applying for probate, and also dealing with the debts and liabilities of Father’s Estate.  During this period, Jennifer had corresponded with Mother and Angela about matters relating to Father’s Estate.  She had also reported to Mother from time to time on the use of the funds drawn from Father’s bank accounts.

201.  Jennifer had also asked Mother for permission to get reimbursement from the Estate Management Funds for the expenses which Jennifer had paid for and on behalf of Father’s Estate.

202.  She believes that she had reported to Mother after having settled all outstanding debts and liabilities of Father’s Estate (although Jennifer now has no specific recollection about this), and that Mother told her that she could keep the remainder of those funds, as this was what Father had said previously.  However, she can no longer recall details of this instance.

D7.3    Michael’s evidence

203.  Michael did not have personal knowledge about the Estate Management Funds.  Indeed, his counsel submitted that it is Jennifer’s evidence which is the focus of this trial rather than Michael’s.  Be that as it may, I set out what Michael stated in his evidence as follows.

204.  In the years following Father’s death, Mother had told him on multiple occasions that Jennifer was simply holding the Estate Management Funds for her, and that she had not gifted any part of Father’s Estate to Jennifer.

205.  Mother again told Michael this when they were trying to obtain information from Jennifer as to the Hong Kong assets in the final few years before Mother passed away, so that she could declare them in her tax returns.

206.  It was Mother’s practice to have Jennifer (a non-resident of Canada) hold non-Canadian assets for her as an “offshore bucket” for tax purposes, and would not have immediately asked Jennifer to return the same to her.

D7.4    Discussion

207.  There is no dispute that Jennifer bears the burden of satisfying this Court of her version of events that:

(1) Father gave her access to his bank accounts because he was always worried that he would die unexpectedly;

(2) Father gave her standing instructions to immediately withdraw the funds if he passed away or his death appeared imminent, and use those funds to pay for his funeral expenses etc., and then keep the rest of the funds for herself; and

(3) Mother knew and consented to the above arrangement as instructed by Father.

208.  This Court is satisfied that Jennifer has successfully discharged the said burden.

209.  Firstly, as far as Michael’s evidence that Mother had told him that Jennifer was holding the funds on trust for Mother is concerned, I have no hesitation to reject the same, because this is contrary to what he himself pleaded in paragraph 16 of the Re-Amended Statement of Claim which reads:

“Whilst the alleged purpose of the withdrawals was initially for managing Father’s Estate, it has come to Michael’s attention during the course of the Trustee Action that despite having provided no or no valuable consideration, some or all of the Estate Management Funds have been retained by Jennifer and she now alleges that they were an inter vivos gift from Mother to her […]”

210.  To recap, the Trustee Action was only started after Mother’s death.

211.  Secondly, it must be noted that, despite Michael’s allegation of what Mother had told him, he admitted that Mother had never asked or demanded for the repayment of the Estate Management Funds.  This is simply inconsistent with his case that the money belonged to Mother. 

212.  On the other hand, this is consistent with Jennifer’s case. 

213.  Insofar as it is said that Mother had always wanted to keep the money as part of her “offshore bucket”, such intention (and the need to do so due to tax consideration) would have gone since 2005 (or no later than 2010) when Mother was minded to report all her overseas assets to the Canadian tax authority.

214.  Thirdly, if Jennifer was minded to retain Father’s money dishonestly, it would be strange that she would report the usage of the Estate Management Funds to Mother in such a detailed way.  Insofar as it is argued by Michael that Jennifer did not have to do so if the money was hers, I accept her explanation that she made the reports to Mother out of respect.

215.  Fourthly, given the detailed reports placed before the Court, I find that it is more likely than not that she had also informed Mother after she had fully settled all outstanding debts and liabilities of Father’s Estate and told her about the amount of money left in the Estate Management Funds. The natural question which had to be resolved would then be how to deal with such a balance.  Unless there was an agreement between Mother and Jennifer that the latter could keep such balance, the money would have to be repaid to Mother.  However, as aforesaid, there is no evidence that Mother had ever asked for it.  Neither had she ever told Michael about such a figure. All these are consistent with the fact that Mother had consented to Jennifer keeping the same.

216.  I will now turn to deal with Michael’s arguments which are not covered by the above.

217.  First, Michael queried Jennifer’s case on the basis that, as far as the Estate Management Funds is concerned, Father did not adopt his usual method (namely, by drafting relatively simple wills, or by adding his children’s names to his assets through joint tenancies) for the alleged purpose of passing the money to Jennifer.  It was said that this is a strong indication that Father did not intend to leave those funds to Jennifer solely.

218.  The short answer to this argument is that there is no basis to say that Father would invariably pass his assets to his children by using the aforementioned 2 methods exclusively.  In my view, it is inherently probable for Father to pass his assets to Jennifer in the way as described by her, because of his close relationship with her.

219.  Second, Michael emphasized that it was not legal for Jennifer to withdraw funds from Father’s personal accounts after his death on the strength of the power of attorney and that her explanation in this regard was “shifty”.

220.  In my view, whether it was not legal to withdraw money from Father’s personal accounts in the way Jennifer did and whether she knew it was illegal is neither here nor there.  The crux of the matter is simply whether Mother consented to Jennifer’s keeping of the balance.

221.  Third, Michael argued that Jennifer’s evidence is incredible because:

(1) According to her evidence, Father’s alleged instruction was strikingly similar to that of Mother (who also allegedly instructed that Jennifer should withdraw the funds “if she should pass away or if her death was imminent”) – this, Michael argued, is plainly unlikely especially as they died some 20 years apart;

(2) As far as her evidence that Father had instructed a banker at Sanwa Bank to “allow her to withdraw money from Father’s account after his death” is concerned, it is inconceivable that the banker would permit this to happen;

(3) Given Jennifer’s admission that Mother, Michael and Angela would have had ample funds to meet any sort of estate duty or funeral expenses, there was no need for Father to instruct that Jennifer should withdraw funds from his accounts for such expenses.

222.  I do not accept that these arguments may assist Michael:

(1) There is nothing suspicious about the similarity of the instructions given by Father and Mother respectively.  Given Mother’s agreement with Father’s instructions, it is not surprising that she had given the same instructions herself.  The long time gap between the respective dates of death of Father and Mother is also a red herring: The much more relevant fact is that, according to the evidence of Jennifer which I accept, Mother had given her instructions in as early as 1997-1999;

(2) What Father instructed the Sanwa Bank banker was simply that if Jennifer came to the bank and asked for withdrawal of money from his account, then the bank should give her the money right away.  Her evidence is not that Father asked the bank to release money after his death on the strength of the expired power of attorney;

(3) The fact that other family members might have sufficient funds to pay off his estate duty and funeral expenses does not mean that Father would not have preferred to settle those expenses by using his own funds.

223.  Fourth, it was further submitted that it is incredible that:

(1) Given the family dynamics, Mother had agreed to the alleged arrangement;

(2) Mother would have, in the same phone call by which she told Jennifer about Father’s unexpected passing, instructed Jennifer to withdraw money from Father’s accounts. 

224.  He also reminded the Court that Jennifer admitted that she actually could not remember the occasion when Father gave the instructions in the presence of Mother, nor could she recall any details of when or how Mother told her that she could keep the remainder of the funds.

225.  I do not accept these submissions for the following reasons:

(1) I find that it is inherently probable that Mother would respect and follow Father’s instructions and intention, particularly when Jennifer was the only child who had been living with Father and assisted in his business;

(2) I find that there is nothing strange for Mother to instruct Jennifer to carry out Father’s wish immediately after she had informed Jennifer about Father’s unexpected demise.  This is particularly so when it is apparent that, if Father’s instruction had to be carried out, action had to be taken as soon as possible.  In this regard, it should also be borne in mind that Jennifer was supposed to fly over to Hawaii soonest.  There was simply no time to waste;

(3) Although Jennifer could not recall the exact occasion on which Father gave the instructions in the presence of Mother, I accept, by Mother’s subsequent conduct (in particular, by giving the same instructions and also instructing Jennifer to carry out Father’s instructions upon his death) that Mother must have been aware of Father’s instructions;

(4) While Jennifer could not remember the details concerning Mother’s instructions about her keeping of the funds, as discussed above, the fact that Mother had never asked her for the funds shows that Mother must have allowed her to keep the balance of the funds.

226.  Fifth, Michael submitted that Jennifer had sought to hide the US$600,000 from the tax authorities in order to avoid estate duty.

227.  In this regard, I accept Jennifer’s submissions that this argument is totally irrelevant.

228.  To conclude, Michael’s claim in respect of the Estate Management Funds must fail.

D8.    The Hong Kong Shares

D8.1 The undisputed facts

229.  YSC was a business founded by Father’s father in 1951, and came to be run by Father solely since the 1980s.

230.  In around 1989, Father acquired the interests of the other shareholders in YSC and restructured its shareholding, with the result that 1,000 shares were held by Father personally (i.e. the Inherited YSC Shares), 1,000 shares were held by Father on trust for Mother (i.e. the YSC Shares on Trust), and 1,000 shares were held by Jennifer as a gift from Father.

231.  Although the letters of administration of Father’s Estate had been granted to Mother in 1999, the Inherited YSC Shares and the YSC Shares on Trust had remained in Father’s name all along.  It was only on about 25 September 2006 that Mother transferred the Inherited YSC Shares to herself.  Separately, she also transferred the YSC Shares on Trust to herself.

232.  In the Instruments of Transfer dated 25 September 2006, it was stated that Mother transferred to Jennifer and Raymond the following:

(1) 1,999 shares of YSC to Jennifer for the stated consideration of HK$199,900 (i.e. HK$100 per share);

(2) 599,999 shares of Haw Yuet to Jennifer for the stated consideration of HK$599,999 (i.e. HK$1 per share);

(3) 1 share of YSC to Raymond for the stated consideration of HK$100 (i.e. HK$100 per share); and

(4) 1 share of Haw Yuet to Raymond for the stated consideration of HK$1 (i.e. HK$1 per share).

233.  Despite the stated consideration, Jennifer, Raymond and Victor did not provide consideration to Mother for the share transfers[11].

234.  Neither did Raymond and Victor provide consideration to Jennifer for the shares allegedly held by her on trust for them.

D8.2  Jennifer’s evidence 

235.  Jennifer’s evidence may be summarized as follows.[12]

236.  After Father’s death, YSC’s business began to deteriorate. Jennifer had suggested to Mother that the business be wound up, but Mother was strongly against winding up, because this was a family business founded by Father’s father.

237.  Mother had repeatedly changed her mind on what to do with YSC.  At one stage, in 2004, Mother’s idea was that the shares in her name would be given to Michael and Angela, because Jennifer already held some shares.  Then, in 2005, Mother’s idea was that the shares would be split amongst Jennifer, Michael and Angela.

238.  In September 2006, when Mother was visiting Hong Kong, she indicated that she had made up her mind, and that all her shares in YSC and Haw Yuet would be given to Jennifer.  When Jennifer said she wanted to wind up YSC, Mother was against this, and said a few days later that she wanted to give the shares to Raymond and Victor in equal shares, so that they could continue the family business.  Since Raymond and Victor were only 21 and 15 at the time, it would not be ideal for them to be the registered shareholders back then.  Therefore, Mother and Jennifer agreed that the shares be transferred to Jennifer, and that she would hold them on trust for Raymond and Victor, save that Raymond would be given 1 share “to get his foot in the door”.   Mother also said that she would discuss this with Michael, and told Jennifer not to tell Angela about this.

239.  Because Mother was frugal, the transfer documents were prepared by Jennifer herself based on precedents, and they were executed on 25 September 2006.  At Mother’s suggestion, Jennifer paid the related transaction costs and expense, including stamp duty.

240.  Jennifer cannot now recall the reason why the transfer documents stated that the shares were paid at a substantial consideration, but believes this was at the suggestion of the auditors.

D8.3    Michael’s arguments

241.  Michael submitted that Mother did not intend to gift the Hong Kong Shares to Raymond and Victor, and that the shares plainly belong to Mother’s Estate.

242.  I will consider his arguments in turn below.

243.  First, insofar as YSC is concerned, Michael argued that the mere fact that Jennifer worked with Father at YSC and that she was given 1,000 shares in YSC during his lifetime, is irrelevant.  He also pointed out that, as Jennifer accepted in cross-examination, Father never said he intended to leave the rest of the YSC shares to her.

244.  Moreover, the rest of the shares were left by Father to Mother upon his death, even though Mother had no active involvement in the business.

245.  These submissions are not understood, for they have totally missed the point that the crux of this matter concerns the intention of Mother but not Father.

246.  Second, Michael argued that there are no contemporaneous documents which show that Mother intended to leave either the YSC or Haw Yuet shares to Raymond and Victor, and that the available contemporaneous documents (between 4 October 2004 and 10 September 2006 (both dates inclusive)) in fact show that Mother simply had not made up her mind.

247.  This submission may, with greatest respect, be dismissed outright, because they have been overtaken by the event of actual transfer of the subject shares subsequently on 25 September 2006 as explained in Section D8.1 above.

248.  I have not forgotten that, in an email dated 21 April 2010, Jennifer told Angela that Mother claimed that a landed property (presumably the Lily Court Flat which was registered under the name of Haw Yuet) still belonged to herself, and that she (Mother) had control over the company holding the house.  However, given the indisputable fact that Mother’s shares in Haw Yuet had already been transferred away back in 2006, I hold that it is more likely than not that Mother was either confused or had somehow forgotten about the transfer when she made that statement to Jennifer.  In any event, the gift had been completed by the end of September 2006.

249.  Third, Michael argued that there is nothing in the objective evidence to support Jennifer’s assertions that Mother was “strongly against winding up YSC”, or that she “wanted YSC to continue operating” by giving the shares to Raymond and Victor for them to continue the business.

250.  It is indeed the case that Jennifer’s said assertions are not referred to in any document at all.  However, I accept Jennifer’s oral evidence in this regard, which is plainly consistent with the objective fact that 1 share in Haw Yuet and 1 share in YSC had been transferred to Raymond (Victor was only 15 at the time of the transfer).  The said assertions are also supported by the evidence of Raymond and Victor.

251.  Fourth, Michael referred to an email dated 26 April 2010 sent by Jennifer to Angela and submitted that what Jennifer said therein was totally inconsistent with her case.  He further argued that, in this email, the reason given for Mother’s decision to transfer the shares was merely that she did not want to have to continue paying for Jennifer’s expenses, not that she wanted to relinquish beneficial ownership of the shares completely.

252.  The email reads:

“She use to come to scream at me every time about how much salary I’m drawing and how much is the management fee. I tell her that I make money for the company in order to pay these expenses. So I’m paying for it. She even tried to kick me out of the flat. I told her she would have to buy me out of my shares in the co and that shut her up. Then suddenly one year she came back, she said she would give me her remaining shares in both companies so that she would no longer be paying my expenses. She transferred 1 share to Raymond and the rest to me. When it was all done, she said ‘we’ won’t be paying for you anymore, right? This time, [Michael] said to me, what type of business are you doing these days? I said nothing much. He must be happy he got out. I told [Mother] myself as well that Eve, SA and I are all in biz and it’s terrible these days. Eve says no one comes to buy these days. Don’t know how she is going to get rid of all that stock. We all have big headaches. All [Mother] does is make trouble when she could be so happy.”

(emphasis added)

253.  Although the email indeed did not mention about Mother’s intention to continue the running of the companies by Raymond and Victor, what is quite clear is that, according to this email, Mother did not want to have anything further to do with the 2 companies in Hong Kong, and that she would give Jennifer the “remaining shares in both companies”.

254.  To say that Mother did not want to pay further expenses for the Hong Kong companies but at the same time did not relinquish her interest in those companies is totally illogical.

255.  I should also add that it is not surprising that Mother decided to gift Jennifer and her children the shares in Haw Yuet which is the holding company for the Lily Court Flat, given Jennifer, Raymond and Victor has/had lived in the said flat for a very long time. 

256.  Fifth, Michael challenged Jennifer’s case by relying on the following evidence adduced:

(1) Raymond gave evidence that Mother did not specifically discuss with him or Victor about their future involvement in the business of YSC;

(2) Victor stated that he did not know in September 2006 that the shares were to be held on trust for him.  He claimed to recall Mother expressing “similar sentiments” over the years about Raymond and Victor continuing the YSC business, but he could not recall the details. While he supposedly recalled someone using the phrase “get your foot in the door”, he did not have any understanding of what that meant.

257.  It was submitted that the evidence of Raymond and Victor was heavily qualified and therefore should not be attached much weight.

258.  I do not accept this submission.  To the contrary, I accept their evidence in full.  As explained under Section C3 above, I find that both of them are credible witnesses.  I also find that their evidence is generally speaking supportive of Jennifer’s case.

259.  Michael’s counsel also particularly highlighted Raymond’s evidence that if Mother asked for the shares back, he would readily agree to transfer them back, and submitted that the most obvious inference which could be drawn is that the shares belonged to Mother and that is why Raymond would have readily given the shares back.  I take a different view.  I am inclined to think that this is the sort of attitude which would be adopted by a grateful grandson who is not greedy.  This evidence also supports my finding that Raymond is a truthful witness, because, as a solicitor, there should be little doubt that he should know that such evidence might be used by Michael to attack Jennifer’s case.  Yet, he had no hesitation to stand by it.

260.  Sixth, Michael alleged that the timing and logic of transferring one share of YSC to Raymond to “get his foot in the door” is difficult to follow.  He said there is no explanation why Mother would suddenly choose to transfer the YSC share to Raymond in 2006, rather than to wait for a few more years until Raymond was no longer still a university student. Further, if Mother really trusted Jennifer that she would subsequently transfer the shares to Raymond and Victor, then it is difficult to see the point of transferring one share to Raymond.  Further, if one share was transferred to Raymond, then surely one share could also have been transferred to Victor as well.

261.  As far as timing is concerned, I do not think whether the transfer was completed before 2006, in 2006, or after 2006 really matters.  In my view, it does not shed much (if any) light on the ultimate question to be decided.  In any event, it seems that Mother had considered how to deal with the shares for quite some time already by 2006.  There is nothing strange for Mother to make up her mind and decide to have a clean break with the companies at that particular point of time.

262.  As to the transfer of the 2 shares to Raymond, I hold the view that this arrangement indeed supports Jennifer’s case that Mother intended to gift Raymond the shares in the Hong Kong companies, otherwise the purpose of such a transaction would go totally unexplained. 

263.  In relation to the submission that one share could have been transferred to Victor is concerned, it is made to be rejected, for this has disregarded the fact that Victor was only 15 years old by 2006.

264.  Finally, Michael submitted that the mere fact that Father and Mother would transfer assets to their children’s names for tax or estate planning purposes did not necessarily mean that the transfers were irreversible.  Thus, it was said that the mere fact that Mother transferred the YSC and Haw Yuet shares to the defendants cannot itself mean that Mother intended to gift the shares to them outright.

265.  The quick answer to this submission is that there is no evidence that Mother had ever requested Jennifer and Raymond to transfer the shares back to her. 

266.  To conclude, Michael’s submissions and hence his claim in this regard should be rejected.

D9.    SHETC Dividends

D9.1  Michael’s pleaded case

267.  In his Re-Re-Amended Statement of Claim, Michael pleaded that:

“24. As regards the SHETC Shares, no transfer was undertaken by Mother following Father’s passing. As at the time when Mother passed away, the SHETC Shares continued to be held and registered in Father’s name even though Mother acquired an interest in and/or beneficial ownership of the SHETC Shares (together with any income, interest or property derived therefrom including but not limited to dividends declared thereon) inherited by Mother upon Father’s passing. SHETC was made aware of Father’s passing.

25. In the course of his conducting due diligence as the sole executor of Mother’s Estate in determining Mother’s assets in Hong Kong, it has come to Michael’s attention that SHETC Dividends declared in respect of the period from at least 2002 to 2017 in the amount totalling approximately HK$590,000 were passed to Jennifer in the form of cheques with the expectation that Mother, as the sole beneficiary of Father’s Estate, would receive the SHETC Dividends.

26. To date, Jennifer, Raymond or Victor have not provided any or any sufficient account to either Mother or Mother’s Estate in respect of […] the SHETC Dividends, nor have […] the SHETC Dividends been transferred to Mother or Mother’s Estate.

[…]

41. In breach of her fiduciary duties as the trustee, Jennifer has retained the Disputed Assets (together with any income, interest or property derived therefrom) to her own use and has wrongfully deprived Mother’s Estate of use of assets that belong to or ought to have been paid to Mother’s Estate:

[…]

     (3)   As pleaded in paragraphs 25 to 26 hereinabove, despite that SHETC passed cheques representing the SHETC Dividends to Jennifer with the expectation that Mother would receive them, the SHETC Dividends were retained to Jennifer’s own use without her paying any or any valuable consideration.”

(emphasis added)

268.  As far as the amount claimed is concerned, Mr Pao SC confirmed in his oral Opening Submission that Michael would claim in respect of two sums only, namely HK$322,824.93 and HK$52,000, instead of the sum of HK$590,000. 

D9.2  Michael’s case at the trial

269.  At the trial, Michael’s case has been summarized in paragraph 56 of his Closing Submissions as follows:

“The dividend cheques were initially deposited into Mother’s account with HSBC, which was her only account in Hong Kong (‘HSBC Account’). However, when Mother was hospitalised on 21 January 2017 (on Michael’s case, this was for pneumonia, whereas Ds contend that it was a ‘mini-stroke’), it is not disputed that Jennifer withdrew a substantial amount of HK$322,824.93 from the HSBC Account on the same day and paid it to herself and Raymond. It is also not disputed that Jennifer withdrew another HK$52,000 from the HSBC Account on 31 March 2017 (one day after Mother’s death) and paid it to herself and Raymond, leaving the account with only HK$100. In the trial of the Trustee Action, Jennifer conceded that this withdrawal was ‘not correct’, ‘improper’ and ‘illegal’.”

(emphasis added)

D9.3   Pleading point

270.  Jennifer contends that the latest case of Michael has not been pleaded in his Re-Re-Amended Statement of Claim.  It was submitted that:

“This claim has never been pleaded. Such a claim would require the pleading of: (1) Jennifer being an authorised signatory of the Dividend Account; (2) Jennifer making the 2017 Withdrawals; (3) such withdrawals were unauthorised and/or for an improper purpose. None of these matters had been pleaded. This is so despite that Jennifer has clearly pleaded her case and had dealt with this in her evidence, including the discovery of the relevant banking evidence (see §§162, 164, 165 above), Michael never saw fit to amend his SOC to properly plead this claim.”[13]

271.  In response, Michael argued that the issue has been squarely raised on the pleadings:

“172.1 In the RRASOC, it was pleaded that the SHETC Dividends cheques were passed to Jennifer, Ds had not provided sufficient account of the SHETC Dividends, and that they have not been transferred to Mother’s Estate (§§25-26). Jennifer holds the Disputed Assets (which include the SHETC Dividends), and any income, interest or property derived therefrom, as trustee for Mother’s Estate (§40). It was also pleaded that Jennifer wrongfully retained the Disputed Assets, and any income, interest or property derived therefrom to her own use and wrongfully deprived Mother’s Estate of the same (§41). Hence, the relief sought includes account and delivery up of the Disputed Assets and any income, interest or property derived therefrom. In substance, the two withdrawals amount to a taking of the SHETC Dividends from Mother.

172.2 In the RRRAD, it was pleaded in response to RRASOC §25 that Jennifer withdrew substantially all the funds in January 2017 (§25.3(b)). In the Amended Answers to FBPs §13, it was stated that the amount withdrawn was HK$322,824.93.

172.3 In the RRAR, Jennifer was put to strict proof that she withdrew substantially all the funds in the HSBC Account pursuant to Mother’s instructions, and that there was no documentary evidence to support Jennifer’s assertion that Mother told Jennifer there was no need to return the funds (§20(c).

173.  There is no dispute that the contents of the HSBC Account, which Jennifer emptied in 2017, were derived from the SHETC Dividends. Therefore, the above pleas plainly put in issue whether Jennifer was entitled to withdraw those monies. In any event, Jennifer obviously knew the case she had to meet, as she has dealt fully with the issue in her witness statement.”

272.  I agree with Jennifer that the current case of Michael is simply not covered by his Re-Re-Amended Statement of Claim.  Pleadings are not supposed to be a game of words.  Their function is to inform the other side clearly what a party’s case is really about.  In my view, a fair reading of the Re-Re-Amended Statement of Claim shows that Michael’s complaint was that Jennifer did not deposit the SHETC Dividends into Mother’s account (“the Dividend Account”), nor did Jennifer, upon failure to make the said deposit, account to Mother where the SHETC Dividends had gone.  If it were Michael’s case that Jennifer had, after depositing the SHETC Dividends into the Dividend Account, withdrawn the same for her own use without authority of Mother, this should have been pleaded, which Michael did not do so.

273.  Although on the face of the wordings, Michael did plead that Jennifer had not provided “any or any sufficient account to either Mother or Mother’s Estate in respect of […] the SHETC Dividends”, properly understood by reference to paragraphs 25, 26 and 41 of the Re-Re-Amended Statement of Claim, Michael’s complaint therein is apparently different from his current case in substance.

274.  Michael submitted that, even if this Court takes the view that his current case is unpleaded, he should be allowed to run such a case because Jennifer would not be prejudiced anyway, given the fact that she had adduced evidence to deal with such an unpleaded case.  I do not accept this submission, for it is trite that a party cannot be allowed to run an unpleaded case simply because the relevant facts have been dealt with in the evidence: Kwok Chin Wing v 21 Holdings Ltd (2013) 16 HKCFAR 663 at [21].

275.  Therefore, Michael’s claim for the SHETC Dividends should be dismissed for this reason alone.

D9.4      Jennifer’s defence

276.  For the sake of prudence, I proceed to consider Jennifer’s defence in relation to the SHETC Dividends, which is summarised as follows[14].

277.  Jennifer’s evidence is that Mother herself had on a number of occasions given the instructions that Jennifer should withdraw the funds from the Dividend Account if Mother should pass away or her death was imminent.  Although Jennifer cannot remember the exact words used by Mother, she recalls one occasion was when Mother was waiting at the Probate Registry in 1997-1999 handling Father’s estate, when Mother said probate procedures were very troublesome to deal with and she would not want this to be done when she passed away, saying that Father’s similar instruction was a good idea. There was another occasion when Mother first received the dividend cheque in February 2001.  There might have been other occasions when Mother had repeated such instructions, but Jennifer could not recall such occasion(s) specifically now.

278.  She had followed Mother aforesaid instructions:

(1) When Mother suffered what Jennifer called a “mini-stroke” on 21 January 2017, Jennifer withdrew on the same day all the funds in the Dividend Account (being HK$322,824.93) leaving behind only HK$100.  Mother did recover from this stroke, and Jennifer reported to her the withdrawal, but she told Jennifer that Jennifer could keep the withdrawn money for herself and Raymond and Victor;

(2) When Mother passed away on 30 March 2017, Jennifer also immediately withdrew the funds in the Dividend Account (being HK$52,000), again leaving behind HK$100.

D9.5   Discussion

279.  Michael argued that Jennifer’s case is incredible.  I will consider his arguments in turn below.

280.  First, he pointed out that, in paragraph 178 of her witness statement, Jennifer was only able to refer to two occasions when Mother allegedly told her that she should withdraw the funds from the Dividend Account if Mother was about to die: once at the Probate Registry in 1997 to 1999, and once in February 2001 when Mother was paid several years of SHETC dividends in one go.  She did not refer to any specific occurrences thereafter.  Although in oral evidence, Jennifer claimed that there “may have been” some further instances, she was unable to give specific examples.  Therefore, even if Mother had said these things, this was long before Mother and Jennifer had strong disagreements about the Dividend Account.

281.  This argument does not assist Michael:

(1) The fact that the conversations took place long time ago is irrelevant, so long as Mother did not change her instructions afterwards;

(2) I do not accept that there had been disagreements between Mother and Jennifer over the Dividend Account.

282.  Second, Michael submitted that the allegation that Mother would gift those funds to Jennifer is inconsistent with Jennifer’s turbulent relationship with Mother in general, and also specifically with Mother’s complaints about the Dividend Account.

283.  As explained in Section D2 above, it is my finding that Mother and Jennifer had basically enjoyed a very good relationship.

284.  As to Mother’s complaints about the Dividend Account, I accept Jennifer’s evidence that she had provided Mother with information as requested, and as a result, Mother’s discontent, if any, had been resolved satisfactorily.

285.  Reference may also be made to a note written by Mother in around 2012 or 2013, in which Mother stated that she was dissatisfied with the way in which Jennifer was handling the BMO Account, that she had decided to take charge of the account, and that those were not Jennifer’s funds.  In my view, if Mother was really dissatisfied with the way Jennifer handled the Dividend Account, she would have mentioned about this in the said note as well, but she did not.

286.  Third, Michael submitted that, while prior to 2017, Mother had already been suffering from serious, potentially fatal medical conditions, Jennifer never tried to withdraw the monies, and that this undermines Jennifer’s account that Mother had told her to take the funds when death appeared “imminent”. He further relied on the fact that Angela was telling Jennifer in as early as 2012 that if she wanted to see Mother alive, she should go to Canada sooner rather than later, as the doctor had reminded Angela to enjoy the time she had with Mother.  Moreover, Victor also gave evidence to the effect that Mother had told Jennifer over the phone, around when she moved into the Chalmers, that her days were numbered.

287.  As far as the timing of the withdrawals are concerned, Jennifer had in her evidence given explanation as to why she did not withdraw monies from the account earlier.  Without disrespect to counsel, I do not intend to go into the details of the explanation, save that I accept her explanation as summarised by her counsel in paragraph 182 of her closing submissions. 

288.  Fourth, Michael submitted that the manner in which Jennifer withdrew the HK$322,824.93 is inconsistent with her own story:

(1) As to Michael’s allegation that Mother was in fact hospitalised at that time for pneumonia (reliance was placed on a medical report dated 26 January 2017) rather than mini-stroke as alleged by Jennifer, I am of the view that the most crucial point here is in fact what Jennifer perceived to be Mother’s situation as at 21 January 2017 (i.e. when the money was withdrawn).  In this regard, this Court’s attention was drawn to an email sent by Angela to Jennifer on that day, in which Angela explained that the cardiologist had mentioned that there was indication that Mother had had a heart attack.  With that information, I accept that it was reasonable and inherently probable for Jennifer to take the view at the time that Mother’s death was imminent;

(2) Michael queried why Jennifer did not choose to wait for a few more days to see whether Mother might recover.  With respect, it is of course easy to criticise after the event.  Further, as Jennifer explained, if possible, it would be better if she withdrew the money while the power of attorney was still legally valid;

(3) Michael further stated that it does not make sense for Jennifer to say in her evidence that she “did it for my father, I wanted to fulfil my mother’s wishes”, for Father had never had any wishes regarding the Dividend Account.  This submission is not understood.  For me, what Jennifer said was just that she wanted to fulfil Mother’s wish just like what she had done for Father in respect of Father’s assets;

(4) Moreover, Michael questioned why Jennifer had to withdraw the money in secret without informing Michael and Angela about it.  On this matter, I agree that the family’s dynamics have to be borne in mind.  In my view, it is totally understandable that Jennifer did not see fit to inform her siblings about her withdrawal, particularly when Mother had actually told her not to disclose to Michael or Angela that money was given to her from this account.

289.  Finally, Michael repeated his submission that Mother did not add Jennifer’s name to the Dividend Account.  He therefore advocated that this would necessarily mean that Mother did not intend to give Jennifer the 2 sums as gifts. 

290.  As explained, while I am of the view that there is evidence that joint tenancy is one of the preferred ways adopted by Mother to give her assets away to her children, there is no evidence that she would use that method (and simple wills) exclusively.  I therefore reject this argument.

291.  All in all, Michael’s claim in relation to the SHETC Dividend must also fail.

E.      ORDER

292.  For reasons of the aforesaid, I dismiss the plaintiff’s claims.

F.      COSTS

293.  I make a costs order nisi that the plaintiff shall bear the defendants’ costs (including all costs reserved), with certificate for two counsel, to be taxed if not agreed. 

294.  The above order nisi shall become absolute in the absence of application to vary (which, if any, will be disposed of on paper) within 14 days hereof.