TONG KIN WA v. TONG SING SHEUNG

HCA 7229/1999

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 7229 OF 1999

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J U D G M E N T

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1. The Plaintiff is one of the beneficiaries of the estate of Madam Tang Ngo (hereinafter refer to as "the said deceased") in her last will (Exhibit 2). The Defendant is the sole surviving executrix named in the last will of the said deceased and she is also one of the beneficiaries of the estate. The Plaintiff, the Defendant and Tong King are now the three residuary beneficiaries in equal share of the estate of the said deceased.

2. The Defendant and the Plaintiff are both permanent residents of Hong Kong and were residing in a property belonging to the estate called the Jade Property, which is situation at Flat C, 16 Floor, Jade Mansion, No. 32, Fort Street. The Defendant is now aged about 80 years old. The Defendant has been absent from Hong Kong for lengthy periods for the past years and this can be seen, for example, in the letters of her solicitors at pages 114 and 116 of the Plaintiff's Bundle of Documents, where her solicitors stated, that in October 1998 they had not been able to contact the Defendant since March 1998 as she was in China. The Plaintiff has also said in evidence that since August 1999 to about the beginning of September 2000, the Defendant had been continuously absent from Hong Kong.

3. The Plaintiff is the lawful nephew of the said deceased. He is now aged 51 and is a lorry driver by occupation. At the time of the deceased's death in 1993, the Plaintiff was living with the Defendant and the deceased at the aforementioned Jade Property, which belonged to the deceased. The deceased at the time of her death also owned three other properties and they are the Coronet property, which is situated at Flat G, 7th Floor, Coronet Court, No. 321-333, King's Road, Hong Kong; the Draco property, which is situated at a workshop on 10th Floor, Draco Industrial Building, No. 46 Lai Yip Street, Kowloon; and the Tak Lee property situated at Flat No. 20, 12th Floor, Tak Lee Building, No. 993 King's Road, Hong Kong.

4. Shortly after the death of the deceased, the Plaintiff was entrusted by the Defendant and Tong King with the responsibilities of all tenancy matters in relation to the Draco property, Tak Lee property and Coronet property between the period from 1993 to about the end of 1995. However, the Defendant held on to the actual rental collection of the Coronet property between the period from 1993 to about the end of 1994. The rental that was collected by the Plaintiff on behalf of the estate was deposited into a bank account in the name of the Plaintiff. However, the passbook to that account was by all material times kept by the Defendant.

5. In 1995, the Defendant demanded that the Plaintiff hand over his role in the tenancy matters affecting the said properties and the Plaintiff did so. Since that day, the Defendant was solely responsible for all matters relating to the properties belonging to the estate and the income and expenditure thereof. It is clear from the documents that the Defendant has not been fulfilling her duty as an executor of the estate to the detriment of the interests of the estate. Some examples of this breach of her duty was the non-payment of estate duty and non-payment of rates for the properties of the estate thus incurring interests and also the non-payment of management fees which was on one of the properties.

6. The Plaintiff was appointed as an administrator pendent lites of the estate of the said deceased on 31 May 2000 by the order of Master Jones. And, since then, he has been administering the estate by paying the outstanding estate duty and obtaining evaluation report to minimise estate duty due to the government and he has opened a bank account in order to collect the rental income of the properties of the estate. He has also instituted proceedings against the tenant who owed the estate some rental income. Apart from the dereliction of her duty, the Defendant has also by her own admission through her solicitors, Messrs Lo and Lo, admitted to misappropriating a sum of about $150,000.00 from the estate (see Exhibit 3). It is also clear at page 338 of the bundle of documents of the Plaintiff that the Defendant withdrew $110,000.00 on 16 February this year from the account which she was holding on behalf of the estate, without notice to any of the beneficiaries and had failed to account for that sum withdrawn. This sum of $110,000.00 when added to the sum of $149,653.70 which is admitted as having been withdrawn by the Plaintiff in her solicitors' letter in Exhibit 3, amounts to $259,653.70 which is the total amount therefore taken out of the estate by the Defendant.

7. The Plaintiff claims in this action damages to be awarded to the estate against the Defendant in that sum of $259,653.70; secondly, that the Plaintiff be appointed as the administrator and thirdly, the Plaintiff be given costs for these proceedings. The Defendant, however, has failed to turn up for this morning's proceedings and despite the fact that she did lodge a defence and counter-claim, she was not appeared herself nor has her solicitors appeared on her behalf. Having considered the evidence of the Plaintiff and also the documentary evidence, I am left in no doubt that the Defendant does owe the estate the sum claimed of HK$259,653.70 and I so order that this sum be awarded to the estate against the Defendant.

8. Under section 36 of the Probate and Administration Ordinance, Cap. 10:

"Where it appears to the court to be necessary or convenient to appoint some person to be administrator of the estate of the deceased person, or any part of such estate........ the court may subject to section 25, appoint such person as the court thinks fit to be such administrator........"

It is clear from the case of Lefkovitch v Bank of New York Anrs [1996] 3 HKC 591 that the words "necessary or convenient" in section 36 gives the judge a broad discretion to be exercised in the best interest of the estate. I have no doubt from the evidence adduced so far by the Plaintiff that were the Defendant to continue as executor or administrator of the estate, then the interests of the estate will be adversely affected. I therefore consider that it is in the best interest of the estate that the Plaintiff be appointed as an administrator of the estate under section 36 of the Probate and Administration Ordinance Cap. 10 of the Laws of Hong Kong. Costs to the Plaintiff.