GALLIUM DEVELOPMENT LTD AND OTHERS v. WINNING PROPERTIES MANAGEMENT LTD

LDBM 121 OF 2000

 IN THE LANDS TRIBUNAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

BUILDING MANAGEMENT Application No. LDBM 121 of 2000

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J U D G M E N T

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1.  The Appeal to the Court of Appeal has been disposed of except as to costs. The Court of Appeal directed me to make  findings in respect of certain items of expenditure, which findings I should have made but failed to make.  More specifically the directions are in paragraph 72 of the judgement:

“ The proper thing for this Court to do, I should think, is to remit the figures in these three Annexes to the Judge so that he would make a finding in respect of each and every item, according to the evidence that had been adduced before him, including all the relevant documents.  The parties’ legal representatives should jointly prepare a Scott Schedule for the purpose.  The parties should be allowed to address the Judge, but their submissions must be limited to the items contained in the three annexes.  If and when the Judge decides there were items in Annexes A and B that should have not been booked to the Building but should have been booked to R2 instead, such sums as found should be repaid by R2 to the Sinking Fund or the Management Fund of the Building, as appropriate.  When the Judge decides on any sums in Annex C which should have been properly booked to the Sinking Fund and not the Management Fund, such sums should be added to the sums in Annexes A and B found due as aforesaid, and the sum total should be used as the basis for 15% thereof to be repaid by R1 as overcharge of its management fees back into the Management Fund.”

2.   I am grateful to counsels for preparing the Scott Schedules. I believe schedules 1, 2 and 3 correspond to the Annexes A, B, and C respectively.  In the course of his submission, Mr. Hingorani thinks it is still a live issue before me to rule whether the R1 was at fault or not, in not treating those items properly. I do not blame him because he was not in the appeal when Mr. Law was.  I accept Mr. Law’s submission on the interpretation of the directions which in any event simple, clear and specific.  I am only to find the facts in respect of those disputed items and made the consequential orders as directed.   It is no longer a question whether the accounting practice was fair or not.  It is not for the Respondents to ask me to rule again on the Applicant’s right to re-open the account. The Court of Appeal allowed the Applicant to dispute those items.  The specific directions were for me to make findings on those disputed items and not on propriety of accounting practice or policy, if any.  In particular, Mr. Hingorani seeks to argue along this line on various occasions.  Similar items, which were for the benefit of the other owners, were likewise booked to the building and not the owners concerned and therefore R1 should not be faulted. This argument is longer available to the Respondents.

Annex A /Schedule 1---$256,139.46---Taken from Management Fund but expended allegedly for R2’s private purposes or otherwise benefiting exclusively only the Shopping Arcade

3.  $9,000 & $58,000---There has been a meagre attempt for Mr. Lee to suggest that the $9000 relates to festivity lights in New Year and or Christmas. His evidence in this respect is not reliable in view of the date of invoice.  I find that these lights are general decorative lights. These two items are of similar nature.  They relate to lightings in the external walls.  Part of the external walls does not belong to R2. On whose walls these lights were mounted or put up is not the only factor to be considered. These lights might not all be on the external walls of the R2.   R2 made use of its external walls and some other parts of external walls, which formed the common part of the building, to house these lights. The purpose was obviously to promote the image of the shopping arcade, or for temping shoppers.    Given the close relationship of R1 and R2 , in particular in respect of the management of the building,  the inference to be drawn is that these lights were intended to benefit R2 alone.  R2 must have participated actively in the decision of putting up these lights. That enhancing the image of the shopping arcade might lead to the inevitable or incidental similar enhancement to the office premises (though it is hotly disputed by the Applicants) is beside the point.   The reasonable inference drawn is that  these lights were not only intended for the benefit of R2 but that both R1 and R2 intended these lights to be so.  This being the case, the burden of proof shifts to R1. It has to demonstrate that as the manager of the building it had the authority to do that and it had done that in good faith.  I disagree that putting up these rights could simply be brushed aside as a building management matter in the sole discretion of R1 as the building manger.  If the whole building is owned by one person, putting up these lights is property management matter rather then a building management matter.   In the particular circumstances of Hong Kong ‘Building management’ means something more complex than property management. The manger is not serving one master as in the case of providing property management services by a property managing agent to a sole principal. He is serving multiple masters with diversified and conflicting interests. As the Court of Appeal in this case has pointed out, the manager has to exercise independent judgment.  Unless R1 has clear authority to put up the lights under the DMC or the Building Management Ordinance, in order to justify the lights, it has to demonstrate it has attempted to strike a balance between conflicting interests of different classes of owners in the building and in good faith.  The DMC only authorises the manager to do what is ‘ necessary and requisite’.   In demonstrating what is necessary and requisite, the need of a particular class of owners, in the instant case, R2’s, is not the only consideration. The interests and views of all owners of the building have to be considered.  No evidence has been adduced to show that a survey was made to ascertain the will of the other owners, and no effort was made by R1 to form an owners committee.  In my judgment R1 and R2 failed to demonstrate that the lights were necessary and requisite within the meaning of the DMC.  Further my conclusion is that the decision to put up those lights was not made in good faith in that no regard or sufficient regard had been made to the interests of the other owners.  These two items of expenses must be repaid by R2 to the Management Fund.

4.  $6,550--- This is for making, dismantling and removing advertisement signs.  Of this item, 3 sub-items represented by invoices at pages 1137, 1139 and 1145 each of the amount $600 The wording there indicates expenses of dismantling, and removing advertisement signs.  Mr. Lee offered an explanation. I regard this not as evidence of facts. I would regard this explanation an argument and which argument Mr. Hingorani has repeated.  This argument suggests that the advertisement signboards were not put up by R2 and were required to be removed by R1 in the  ordinary course of performing its duty as building manager. The advertisement boards were all in the lobby and not inside the shopping arcade.  It is not improbable that they were put there by recalcitrant tenants or other owners. For a variety of reasons, these had to be removed and the expenses could not be recovered from those responsible.  For example, the tenants had vacated the premises without removing their advertising boards, or that they were put up there without permission.  This might not have actually happened.  However this likelihood I cannot ignore as a matter of common sense.  In this regard, I do not think that the Applicant has discharged its burden of proving that the expenses should be borne by R2 or, that the circumstances in which these expenses were incurred are such that it is incumbent on R2 to account for them.  I do not think these expenses should be reimbursed to the Management Fund.  As to sub-item of $300 relating to a ‘To Let’ signboard, Mr. Lee explained this is for removal not for the cost of making it.  This suggestion contradicts the plain wording of the invoice at page 1141.    The reasonable inference is that it is R2 which required the use of this signboard.  At page 1143, is the invoice for a signboard costing $450. The wording there shows it is for the use of shopping arcade. This sub-item should also be repaid. Similarly for the sub-item of a ground stand sign board at page 1147. This item costs $4000. The total amount under this item which should be repaid by R2 to the Management Fund is therefore $4750.

5.  $36,288.16---This item represents the sum total of the monthly maintenance charges over a period of time. The subject matter of maintenance is described in the ledger as “neon lights”. Mr. Lau submits that no office buildings in Hong Kong require neon lights for decoration or illumination purpose and therefore the inevitable conclusion is that the expenses must be for the benefit of the shopping arcade.  The inference may not be inevitable but in the particular circumstances of this case, namely, the set up of the building, its neighbourhood,  this is the inference I draw.  This items should be repaid by R2 to the Management Fund.

6.  $6780.3 ---This item relates to the directory board. Clearly it is for the use and benefit of R2. There is no dispute on that. The argument, “no fair treatment”, is not available. That being the case, this item should be repaid.

7.  $31500 --- The subject matter was described only briefly in the invoices. It relates to the main switch of neon lights. Mr. Lee gave evidence that the main switch described in the invoices for this item in fact controlled electricity supply not only to neon lights but to other equipment. Mr. Lau urged me not to rely on his evidence on the ground that at the time Mr. Lee was not the building manager.  Mr. Lee had been the building manager for quite some time. He must have some working knowledge of the building facilities present and the past. This knowledge he has demonstrated while he was in all practical terms conducting the site tour we made during the trial. An electricity supply in  the building in question must be very complex.  I have not been given details what they were. Relying simply on a brief descriptions of the invoice is more dangerous than relying on Mr. Lee.  The ultimate burden to prove that the work was for the exclusive benefit of R2 rests on the Applicants.  They have not discharged the burden. R2 does not need to repay this item.

8.  $63,365 ---There are expenses for flowers, Christmas  trees, pot plants etc. to decorate the building for Christmas and New Year, and Chinese New Year. Except for the Christmas tree placed in the lobby costing $1500 (invoice at page 1175), the rest were for decorating shopping arcade floors.  Mr. Lau submits that these expenses are excessive and therefore are not ‘necessary and requisite’ within the meaning of the DMC.  Comparing these expenses with the cost of the Christmas tree in the lobby for the whole building, I agree with Mr. Lau. For similar reasons given in paragraph 3, I find these expenses for decorating the shopping arcade floor are intended by both Respondents to benefit R2 exclusively.  R2 has to repay these expenses, namely, $61865 ($63365-$1500).

9.   $12500---These are expenses incurred in installing Christmas lights and in their removal. These lights were all outside the building. Whether or not they are installed on property of R2, these lights create festivity spirit which I cannot say it benefit only R2. The amount is small and reasonable considering the size and composition of the building and I do not think that the Applicants have discharged the burden of proof. R2 is not required to repay this item.

10.  $8200---These are expenses for the removal of decoration items from the shopping arcade floors. These must be for the benefit of R2.  R2 has to repay this amount.

11.  $576---These are expenses for the decoration in R2’s office. Clearly it is for its exclusive benefit and R2 has to repay these expenses.

12.  $21,880---This item relates to the ‘Autumn Dream’ signboard and advertisement board. Not by any stretch of imagination can I find that this is not for the exclusive benefit of R2.  R2 has to repay this whole amount.

13.  $1500---The invoice in question is addressed to R2. Though the invoice does not spell out the details of the transaction. An inference can be drawn that it is something about Easter. Common sense dictates that Easter is an occasion for R2’s tenants in the shopping arcade to promote its business. This item of expenses must have been incurred by R2 to promote the interests of its tenants and in turn its owns interest as the owner of the shopping arcade. R2 has to repay this item of expenses which are spent for its benefit  and not for the benefit of the other owners.

14.  Under this schedule/Annexure A, R2 should repay to the Management Fund a total sum of $208,839.46 ( 9000+58000+4750+36288.16+6780.3+61865+8200+576+21880+1500)

Annex B /Schedule 2---$270,974---Taken from the Management Fund and expended on part of alteration works done benefiting exclusively only the Shopping Arcade

15.  One golden thread runs through the arguments of the Applicants in respect of these items. Any items of work done during the time of the project, or done at times close to it must be part and parcel of the alteration project and as such they must be for the exclusive benefit of the shopping arcade.  This is so even if the work can be properly regarded as ordinary maintenance work. In answer to my query as to how long a time should R2 be held responsible for the maintenance of the renovation work, Mr. Lau, suggests one year. He says this is the commonly adopted defects liability period.  I am of the view the argument is too simple, and if given full effect all the items in this schedule should be repaid by R2.

16.  Mr. Hingorani however urged me to look at the nature of the work and the reasons for doing the work. Ultimately he argues that all these work are not part and parcel of the renovation project. 

17.  The renovation project can be viewed as building a number of composite units.  Looking at it this way, the test should be whether or not the unit, to which the disputed expenses relates, is part and parcel of the renovation project. If it is, the next question should be considered is whether the disputed item of work is part and parcel of the building work of the unit.  To arrive at the conclusion, the nature of the work, the timing of the execution of the work, its purpose actual and intended should all be taken into account.

18.  $31000, $3760 & $3370---These items relates to the modification of lifts including cancelling the landing and entrance at  UG/F for three passengers lifts.  After modification some of the lifts would cease to stop at certain floors of R2.  There should be no doubt that visitors to floors above the R2’s would have better service of the lifts. Mr. Lau does not dispute that.  He contends that R2 wanted to close the entrance to enable it to decorate the arcade floors better.  The decoration put up there appears to be good. It does not follow that an equally good, or an even better decoration could not have been achieved when the door entrances had remained there.  I cannot underestimate the artistic aptitude and ability of interior designers.  I accept Mr. Lee’s evidence that there had been complaints about the slow service of the lifts by users of upper floors.  To say the very least, and looking at the matter objectively, the modification of lifts was undertaken not for the exclusive benefit of the renovation work. I have no reason to reject the evidence of Mr. Lee in this respect. R2 should not be required to repay this amount.

19.  $19300, $2500, $5500,$6500 & $3200---These relates to items of work which Mr. Lee describes as repair and maintenance. Some of which are definitely remedial work and some might be termed as improvement work. Mr. Lau contends that all these should be regarded as part of parcel of the original renovation work.  He argues that all these expenses were incurred because the original design was faulty or because the workmanship was poor. I agree that the original design was not perfect and that the workmanship might not be satisfactory. On the other hand the evidence does not support the conclusion that the toilet was not constructed to a reasonable standard. In fact, the toilet had been completed and in use for some months before the problems arose.  R2’s liability to repay these sums is not quite the same as a contractor’s liability for damages for poor workmanship, at least for the purpose of these proceedings.  The toilet in question for all practical and realistic purposes has become a common facility of the building since the completion of the renovation project in early 1997.  The disputed work does not form part and parcel of the construction work of the toilet. The real question is exactly what Mr. Hingorani submits. Is it the building manager’s duty to carry out these items of work. The answer is in the affirmative.  Whether R2 should be sued for the poor design and poor workmanship is not relevant in this case.  I cannot accept the suggestion that R2 deliberately divides the renovation project into two stages so that these items of expenses can be booked to the building.  It is my finding that the work has not been foreseen by R2.  R2 should not be required to repay these items.

20.  $12500---This is the expense for constructing a protective cover for the AHU relocated to the open-air space on the 3^rd floor roof.  Mr. Hingorani could have succeeded applying the same argument as in the previous item but for the following facts.  Mr. Lau rightly pointed out the costs constructing the plinth was booked to R2.  This cover was constructed about 25 days later. The AHU was moved from indoors to outdoors.  The need for the protection cover must be obvious to R2. Further it is under a duty to provide for comparable facility to house the AHU.  Providing the cover is therefore must be looked at as part and parcel of relocation work for the AHU for the costs of relocation R2 should be booked.  Even without relying on the point made by Mr. Lau about the crossed-out words in the invoice, I find this is clearly a capital expenditure. R2 should refund this item to the Sinking Fund.

21.  $4500--- The relevant invoice is at page1108. It relates to plumbing work involving replacing the old water pump with a new one to increase the water pressure.  Mr. Lee was cross-examined upon this item. Nothing he say is inconsistent with the invoice. The date of invoice is in September 1997. Mr. Lau relies simply on the proximity of time to suggest that it is part and parcel of the renovation project. I do not find the Applicants has discharged the burden of proof.  R2 does not need to repay this item.

22.  $19500---This relates to installation of water tank. The arguments raised by the parties are the same as in the previous item for plumbing work.  The date of invoice as can be seen at page 1110 is in July 1997.  The time of execution of this work is closer to the renovation project than the last item. Despite this, I do not find this water tank is a composite unit of the project or that it is in any way connected to it.  The Applicants have not discharged the burden of proof. R2 is not required to repay this item.

23.  $17000---Mr. Lee was cross-examined on the technical details of the electricity supply network. Nothing from him or from the invoice shows it has any connection with the renovation work. R2 should not be required to repay this item under this schedule.

24.  $27500---This is the construction costs of  a metal shed on the flat roof of 3^rd floor. This shed was a subject-matter of a building order and was demolished. This is no evidence to connect this to the renovation work of R2.  That it was constructed during the time of the renovation work is not sufficient proof that it was connected to it. The Applicants have failed to discharge the burden of proof.

25.  $23500---This is the expense for the installation of metal louver window on 29/F.  The installation was made during the time of renovation work. This is hardly sufficient to connect it with the renovation work in the shopping arcade. This item should not be booked to R2.

26.  $1500---This is for the installation of an unauthorised wall. There is simply no evidence to connect this to the renovation work.  This item cannot be booked to R2.

27.  $8100---Mr. Lee explained how this item came to be spent. The duct behind the bulkhead leaked several months after the renovation work. The bulkhead had to be taken down to effect repairs to the duct. Once the bulkhead was taken down, it could not be used. I accept his evidence. The invoice indicated it is additional work. That corroborates Mr. Lee’s evidence.  The situation is similar to that of the male toilet repairs.  At the time of taking down the bulkhead, it was the duty of R1 as the manager to effect repairs on common facilities and it was proper not to book this item to R2.  There is no need for R2 to repay this item.

28.  $6000---There is a dispute whether the Applicants can now challenge this item in view of my judgment. If I have so ruled in favour of the Respondents as Mr. Hingorani submits, the ruling must be taken to have been overturned by the Court of Appeal when the matter is remitted back for my determination. This item is included in Annex B for me to determine whether R2 should be booked for this.  This item is expenses for relocation of sprinkler heads and is exclusively for the benefit of R2. In view of his relatively small amount I do not regard it as capital expenditure. R2 should repay this item to the management fund.

29.  $11500---Under cross-examination, Mr. Lee explained that these expenses were incurred because repair or remedial work was to be done to the lamps installed in the renovation work.  Months elapsed after the completion of the renovation work. For similar reasons given for expenses relating to the mail toilet,  I do not find R2 should be booked this item.

30.  $31064---This is the purchase price for thirty speakers and one amplifier. Mr. Lau seeks to attribute them to the requirement of the renovation work and cross-examined Mr. Lee on this, but to no avail.  It is true to say Mr. Lee could not explain clearly how the sound systems worked, but he maintained they were for replacement stock.  Mr. Lau suggests no such large quantity of loudspeakers would be for replacement stock purpose and no one would stock an amplifier.  In view of the scanty evidence how the system worked, I am not prepared to draw such adverse inference. Firstly, Mr. Hingorani has demonstrated that a stock of thirty loudspeakers is not large. He points to previous invoices indicating that seventy loudspeakers were purchased and booked to Sinking Fund. It was so booked because it was the entirely of the system.  Secondly, it is not uncommon for people to have frustrating experience in finding a particular model, or suitable model of ancillary part of their audio system to replace their broken down one.  It is not necessarily unreasonable to maintain the stock of that size. Thirdly, this matter could have been addressed to during the site visit, counting the loudspeakers in use, or inspecting the actual stock. This was not done. I have no idea the normal working life of these equipments. I am not prepared to use my very limited knowledge of audio system equipments to take a wild guess at the reasonable level of stock. I find that the Applicants have failed to discharge their burden of proof.  R2 is not liable to repay this amount.

31.  $2850---This item is for the installation of damper and four iron doors. They were at the fire exit and in the common area. The Applicants’ accounting expert has himself excluded this item. I just do not understand why the Applicants still pursue their claim for this item. Perhaps it may be argued that as this expert evidence is found to be unreliable, his exclusion of this item should not be relied on.   There is no evidence to suggest that these doors were connected to the renovation work. This is an item within R1’s power to spend. R2 is not liable to pay for this.

32.  Under Annex B/schedule 2, R2 is liable to repay $12500 and $6000 to the Sinking Fund and Management Fund respectively.

Annex C/Schedule 3---Works in the nature of “major overhaul or replacement facilities of a capital nature” so that any payment therefore should have been taken from the Sinking Fund but were in fact taken from the Management Fund

33.  There is no dispute that the items in this schedule were taken out from the Management Fund. The dispute is merely if any of them should be booked to the Sinking Fund.

34.  As the Court of Appeal has pointed out that the significance of the distinction only affects the remuneration that R1 is entitled to charge under the DMC. Despite my repeated invitations to counsels to address me whether this significance would in any way helpful in the interpretation of the relevant term. The DMC clearly intends R2 to charge a percentage on the expenditure on Management Fund and not to the other. Counsels did not seem to be with me and the factors, they proposed  in argument, that I should take into account do not include consideration of R2’s potential remuneration on the funds.

35.  All the factors proposed by counsels should be taken into account. The nature of the work or services, the actual and relative size of the expenditure, the recurrence and regularity of the work, and some other factors which cannot be generalised. It is question attaching relative weights to different conflicting factors, or taking a global view on these in the particular situation.  Mr. Hingorani suggests that the view point of the Manager should be considered.  He in fact further suggests that the test should be whether it is reasonable for the manager not to charge these items to the Sinking Fund.  I disagree. Good faith or bad faith,  is irrelevant. It is not the case of suing the manager for committing a breach of contract or fiduciary duty. It is simply a question of rectifying the account.   If on the true interpretation of the DMC, the expenses should be charged to the Management Fund, the accounts must be rectified. It is for this purpose the matter is remitted back for determination. In any event it cannot be right that the manager has a free hand in interpreting the terms of DMC, particularly, there is a conflict of interests.  The manager cannot be heard to say, “Oh! ‘Of capital nature’, it is difficult term to interpret. I construe the term in good faith and let the mistake be, if there is any. ” while profiting from his mistake.

36.  Another principle is this. It is not proper to divide a job into smaller ones and argue that each of the small jobs are ordinary repairs and maintenance. The nature of the whole job that was undertaken has to be looked at.  A corollary to this is that we cannot compress the time scale to aggregate a number of widely spaced minor repairs, or overhauls, to form one major overhaul.

37.  $183700---These are expenses for overhauling services for two of the three chillers at different times. Each of them costs something over 3 million.  Mr. Lee in effect agreed that these were not the type of repairs that may have to be effected as and when the problems arose. Apart from this there is no evidence as to their working conditions before overhaul.    This amount consists of two sub-items, $90700, and $9300. Each one is for overhauling services of  performed at different times to each chiller.  The scope of work is set out in the quotation for one of them but it is the same for the other. I only need to look at the sub-item $90700. Arguably some of the work specified there, if considered individually and in isolation, and performed at widely spread intervals, may be correctly charged to the Management Fund.  However the whole job must be looked at. The scope of work appears to be extensive, and $50000 is the labour costs. This is not likely to be a recurrent expenditure on a yearly basis or on other basis of longer period.  My conclusion is that the job is the major overhaul of the chiller in question. Needless to say the conclusion applies to the sub-item $93000.  The amount of $183700 should be charged to Sinking Fund and not to the Management Fund. 

38.  $39850 ---$25000 at page 1218 represents the acquiring spare parts for the chillers.  I am not satisfied that this is an exercise forming part of a larger job, let alone a major overhaul. They are for replacement. No one would doubt that. But replacement of a spare part with new one does not in every case means replacement of facilities of capital nature. This appears to be a normal expenditure for repair and maintenance. The Applicants has the burden to show it is not.   I find this amount of $25000 is properly charged to the Management Fund. The same applies to the sub-item at page 1226 for the sum of $14850.   Whether one calls it repairs and maintenance or overhaul is not important. It is matter of degree. Prima facie this sub-item is not part of a bigger overhaul job. I find this item properly booked to the Management Fund.    

39.  $367630---This is expenses for the job for the condenser coils.  Its scope of work clearly indicates it is not a ordinary routine repair and maintenance. It is an overhaul and replacement of facilities.  The work is not simple and requires erection of scaffolding. One does not expect this kind of work to be carried out often. This expenditure is not likely to recur frequently. I find that this expenditure is either for a major  overhaul or for replacement of facilities of capital nature.  This expenditure should be put back to Sinking Fund.

40.  $85000---This is a replacement of insulation for chilled water supply pipe.   This is not ordinary routine repair and maintenance.  The amount is substantial and this should be regarded as of capital nature and should be put back to Sinking Fund.

41.  $138650---These expenses for replacement of units of air-conditioning system. These replaced units do not represent the whole system but they are the very important component parts of the whole system. Replacement of these components must be regarded as ‘of capital nature’ as a matter of common sense. I find this item should be put back to the Sinking Fund.

42.  $131500 ---Despite the apparent large amount involved, the job description at page 1240 indicates clearly this is ordinary maintenance and repair work for the roof.  The amount is large because it is in general very expensive to maintain and repair the waterproofing of the roof.  The amount of the work does not by itself change the nature of the work involved. There is no ground for saying that this is a major overhaul or replacement of facilities of capital nature.  The Applicants have failed to discharge the burden of proof. This item can remain in the Management Fund.

43.  $12000---There is no basis for alleging that this is an item of capital nature or overhaul. The Applicants failed in this item. 

44.  $23000---There is no evidence as to the functional life of the pump in question. Common sense dictates that it would last for years. It is clearly a capital expenditure item.  I find for the Applicants in respect of this item.

45.  $47290 ---This is an item of replacing steps of escalators.  These steps must be durable and last for years. This is an expenditure for replacement of facilities of capital nature. The item should be put back in the Sinking Fund.

46.  Accounts should be adjusted so that a total sum of $845270 can be correctly booked. I now make the necessary order to that effect.

47.  I now also make the orders in terms of my findings ordering R2 to repay to the respective funds the sums mentioned above and R1 to refund the overcharged remuneration.   Mr. Lau indicated he wished to argue for costs after my findings. In view of his preference and in view of the finding I would not make any order for costs before hearing counsels.