TSANG LIN YAU LINDA (sue as the Administratrix De Bonis Non of the Estate of the late LEE WONG FUN CHONG also known as LEE WONG FUN CHONG Florence) v. LEE JUN SING AND OTHERS

HCA 1114/2022

[2025] HKCFI 5117

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1114 OF 2022

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D E C I S I O N

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A.  INTRODUCTION

1.  By summons dated 28th July 2025(“the Leave Summons”), the Plaintiff seeks leave to appeal^[1] against the costs order made in my judgment of 11th July 2025 (“the Judgment”).  The order provided that:

1.1  the costs of and occasioned by the action are to be paid by the Plaintiff to the Defendants, and that the costs of and occasioned by the counterclaim (“Ds’ Costs”) are to be paid by the Plaintiff to Lee Jun Sing D1, and

1.2  the Plaintiff is to pay Ds’ Costs personally and is not to recover them from the estate of Mrs Lee.

2.  The Plaintiff further applies for leave to admit the Second Affidavit of Tsang Lin Yau Linda of 25th July 2025 (“Tsang 2nd”), for the purpose of the Leave Summons and (if leave is granted) the appeal itself (“the Evidence Summons”).

3.  This decision should be read in conjunction with the Judgment, which sets out the relevant background.  The abbreviations used in the Judgment are also used here.

B.  THE RELEVANT PRINCIPLES

B1.  The Leave Summons

4.  There is no dispute that leave to appeal is needed pursuant to s.14(3)(e) of the High Court Ordinance, Cap.4 (“the HCO”).

5.  There is also no dispute that the principles applicable to an application for leave to appeal under s.14(3)(e) HCO are as set out by Kwan JA (as she then was) in Waddington Limited v Chan Chun Hoo Thomas and others, unreported, HCMP 1326/2017, 18th October 2017:

“ 3.  Leave to appeal will not be granted unless the court is satisfied that the intended appeal has a “reasonable prospect of success”.  That means a prospect that is more than “fanciful” but without having to be “probable” (SMSE v KL [2009] 4 HKLRD 127, §17).  But even if the threshold test of reasonable prospect of success is satisfied, the court still retains a discretion whether to grant leave, although the fact there is, ex hypothesi, a reasonable prospect of success would heavily influence the court’s exercise of discretion.  The court may refuse leave to appeal in the interests of procedural economy and proportionality (Wong Kar Gee Mimi v Severn Villa Ltd [2012] 1 HKLRD 887, §30).

  4. The Court of Appeal will not interfere with the exercise of a judge’s discretion in the award of costs unless it was shown that he failed to exercise the discretion, or exercised it upon a false principle, or did not exercise it judicially (Choy Yee Chun v Bond Star Development Ltd [1997] HKLRD 1327 at 1337A).  Further, it is trite that an appeal against the exercise of discretion will not be entertained unless it is shown that the discretion was not exercised at all, or that the judge made some error of law or facts or was in disregard of principle, or that he took into account irrelevant matters, or that the decision was “plainly wrong” or was “outside the generous ambit within which a reasonable disagreement is possible” (Hong Kong Civil Procedure 2018, vol 1, §59/0/54).”

B2.  The Evidence Summons

6.  The admission of new evidence on appeal is governed by RHC O.59 r.10(2), which provides that the Court of Appeal has power to receive further evidence on questions of fact, but that no further evidence (other than evidence as to matters which have occurred after the date of the trial or hearing) shall be admitted except on special grounds.

7.  Procedurally, an application for leave to adduce new evidence cannot be entertained until after leave to appeal has been granted.  Whether or not new evidence should be admitted is a matter for the Court of Appeal to consider.  However, in applying for leave to appeal, the applicant may be able to support his application by reference to new evidence if he can demonstrate that it is reasonably arguable that the Court of Appeal would grant leave to adduce the evidence pursuant to the Ladd v Marshall criteria, so that the judge considering the application for leave to appeal (including the first instance judge) would have to examine whether or not the new evidence could arguably satisfy the criteria: see Man Lin Heung v 梁根林and others 2019 [HKCA] 846 at paragraph 2, footnote 1 (Lam VP, as he then was, giving the judgment of the Court of Appeal).

8.  The three conditions in Ladd v Marshall [1954] 1 WLR 1489 are that:

8.1  the evidence could not have been obtained with reasonable diligence for use at the trial;

8.2  the evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive;

8.3  the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible, though it need not be incontrovertible.

C.  THE INTENDED GROUNDS OF APPEAL

C1.  Ground 1

9.  The first intended ground of appeal is that the court did not have jurisdiction to order the Plaintiff to pay Ds’ Costs personally and that she cannot recover them from the estate of Mrs Lee.  The objection is not so much to the part of the order that the Plaintiff pay Ds’ Costs personally (since the Plaintiff accepts that as administratrix, she is personally liable in the first instance),^[2] but to the part of the order that she cannot then recover them from the estate of Mrs Lee.  Counsel for the Plaintiff, Mr Jeff Yau, says that the question of whether she can recover Ds’ Costs from the estate of Mrs Lee (which Mr Yau termed “the Indemnity Question”) is a matter of internal administration between the Plaintiff and the estate.

10.  Mr Yau refers to the statutory basis for awarding costs in s.52A(1) HCO.^[3]  He says that this is subject to O.62 r.6(2),^[4] which only deals with a personal representative’s entitlement to his own costs but not costs ordered to be paid by him.  He says that it is arguable that these provisions do not give the court the power to deal with the Indemnity Question.

11.  However, the wording of s.52A(1) HCO clearly provides that the court has “full power to determine by whom and to what extent the costs are to be paid”.  Furthermore, even if O.62 r.6 provides for two situations in which the discretion to order costs is restricted (O.62 r.6(2) being one of them), it does not suggest that there is a third such restriction that the court cannot order that a personal representative be personally liable to pay costs without recovery from the estate.

12.  Still further, apart from s.52A(1) HCO, the court has the power to order that a personal representative should not recover from the estate any costs which he has been ordered to pay, as indeed Mr Yau accepts.  Mr Yau points out that when costs are ordered against a personal representative in an action between him and another party (which I will refer to as a “third party action”^[5]), they are in the nature of costs, but when the personal representative seeks to recover them from the estate, then they are in the nature of charges and expenses which the personal representative seeks to recoup from the trust fund. He cites Williams, Mortimer & Sunnucks on Executors, Administrators and Probate, 22nd ed., at 59-01 to say that when the judge makes a costs order in a third party action, he is not concerned as to whether the representative will be entitled to be indemnified against the order out of the estate, and “will have no jurisdiction to decide that question, because the persons interested in the estate are not party to the proceedings”.  He says that the issue of whether the personal representative can recoup costs ordered against him in third party proceedings is one that has to be decided in an administration action.^[6]  He accepts that the applicable test in such an action would be that of whether a judge hearing a notional Beddoe^[7] application would have granted a Beddoe order.^[8]

13.  Mr Yau therefore accepts that the court would have jurisdiction (in the sense of power) to determine the Indemnity Question, but it is just that the court cannot do so by way of a costs order in the present proceedings; rather, it would have to be made in administration proceedings between the Plaintiff and the beneficiaries of Mrs Lee’s estate

14.  However, the reason why Beddoe orders, when sought prior to the conclusion of third party actions, should be made in separate proceedings is that (1) the purpose of the application (if made prior to conclusion of the proceedings) is to inform the court of the strengths and weaknesses of the personal representative’s case, or issues such as settlement, and it would be inappropriate to reveal these to the court trying the third party action, or the parties to that action; and (2) if an order is to be made in favour of the personal representative that he will be indemnified as to costs by the estate, the beneficiaries, who would be adversely affected by such an order, should first be given the opportunity of being heard: Alsop Wilkinson at 1225G to 1226B.^[9]

15.  The question is therefore not one of jurisdiction in the sense of the court not having the power to determine the Indemnity Question. ^[10]  Nor was Williams, Mortimer & Sunnucks suggesting otherwise: the point being made was that an order should not be made against the estate without first hearing from the beneficiaries, who would be adversely affected by such an order.^[11]  It does not follow that an order which does not affect the estate cannot be made against a personal representative without first hearing from the beneficiaries.

16.  Mr Yau submits that it would be inconsistent for there to be parallel procedures for a personal representative to seek an indemnity for costs against the estate, either by way of a costs order in a third party action or by way of an administration action.^[12]  However, as analysed above, if a personal representative is seeking an order against the estate, it would be necessary to hear from the beneficiaries first; he would not seek the indemnity in the third party action to which the beneficiaries are not party.  In the present case, the order made does not affect Mrs Lee’s estate, so that it is not necessary to hear from the beneficiaries first.  If the objection is that the Plaintiff should be able to appeal as of right against the order as if it had been made in an administration action, that is not an issue arising on the Leave Summons.  Whether or not leave is required to appeal against such an order does not affect the question of whether the court has jurisdiction to make it.

C2.  Ground 2

17.  The second intended ground of appeal is that even if the court had the jurisdiction to determine the Indemnity Question, the court should not have done so, as not all of the beneficiaries were before the court, and as the 2nd to 4th Defendants were not entitled to be heard on the question.^[13]

18.  However, the order that was made did not allow the Plaintiff to recover costs from Mrs Lee’s estate, and therefore does not affect the beneficiaries of the estate of Mrs Lee.  There was no need to hear from them.

19.  In any event, in the present case, the beneficiaries of the estate of Mrs Lee were (1) Lee Jun Sing D1 (who was party to the proceedings and was heard), (2) Lee Jun Wai (who disclaimed any interest in the Share which was the only remaining valuable unadministered asset of Mrs Lee’s estate,^[14] so could hardly ask to be heard), and (3) the Plaintiff in her capacity as executrix of Mr Lee Senior’s estate (but it was not suggested that she was therefore unable to raise any relevant matters).

20.  As regards the 2nd to 4th Defendants, although it was said that they had no locus to say anything about the Indemnity Question, it was not suggested that they said anything different from Lee Jun Sing D1.

C3.  The Evidence Summons

21.  Mr Yau says that Tsang 2nd is relevant to Ground 3, as it contradicts the finding in paragraph 131 of the Judgment that the Plaintiff was the only one who stood to benefit if the Share was recovered for Mrs Lee’s estate.  I will therefore consider the Evidence Summons before turning to Ground 3.

22.  In my view, the Plaintiff fails to show that the proposed new evidence would arguably satisfy any of the Ladd v Marshall criteria.^[15]

23.  Evidence could have been obtained with reasonable diligence.  The Plaintiff says that the valuation of the Share was not in issue at trial, and the point only arose in relation to costs, so that she could not have anticipated the need to adduce valuation of the Share at trial.  However, the Defendants’ closing submissions raised the point that it would be unfair for the Plaintiff to be allowed to recoup her costs, and Ds’ Costs, from Mrs Lee’s estate, and sought an order that the Plaintiff should personally bear both sets of costs.  These submissions were lodged on 6th June 2025.  The Plaintiff’s closing submissions, lodged on 10th June 2025, did not apply to introduce evidence to meet the Defendant’s submission (or suggest that any evidence was required to do so).  What was said instead was that it was premature to prejudge the outcome of the trial and to assume that the Plaintiff would fail in her claim.  At the hearing of oral closing submissions on 12th June 2025, the Plaintiff still did not suggest that any evidence was required to meet the Defendants’ point.  As counsel for the Defendants, Mr Nelson Miu, has pointed out, the valuation calculations in Tsang 2nd were obtained in April 2023 and they could have been put forward.  Tsang 2nd says that it was only at the hearing of oral closing submissions on 12th June 2025 that the court indicated that costs would also be dealt with, so that the Plaintiff was not in a position to put forward evidence then and there, but there was not even any suggestion from the Plaintiff that (for example) there was relevant evidence which the Plaintiff would seek to adduce on the issue.  Counsel then acting for the Plaintiff, Mr George Chu, was specifically told that (1) to avoid the parties incurring the further expense of an additional hearing, the court would deal with all issues relating to costs, unless the parties identified any reason why this should not be done, (2) the issues relating to costs were the Plaintiff’s application for an order that the costs of the action should be paid by the Plaintiff without recovery from the estate, and for an order for indemnity costs.  Mr Chu did not suggest that these matters should be deferred so as to enable relevant evidence to be considered.

24.  Not the case that evidence would probably have had important influence, or that it is apparently credible.  Tsang 2nd contradicts Mr Chu told the court at the hearing on 12th June 2025, namely, that the proceedings were brought for the benefit of the Plaintiff personally.  At that hearing, Mr Chu was specifically asked whether the court was correct to understand that the action was initiated for the Plaintiff’s own benefit, and that she was the only person who stood to benefit in the event that the Plaintiff’s claim succeeded.  Mr Chu confirmed, several times, that this was the case.

25.  It is true that Mr Chu subsequently submitted that the proceedings were for the benefit of Mrs Lee’s estate as Janet Wong D3 was not a beneficiary thereunder, so it would be a benefit to the estate to recover the Share.  However, the only beneficiaries of Mrs Lee’s estate were (1) the Plaintiff as executor of Mr Lee Senior’s estate, (2) Lee Jun Sing D1, and (3) Lee Jun Wai; and there were no creditors of the estate.  The action was not brought for the benefit of recovering anything for Lee Jun Sing D1 or Lee Jun Wai; on the contrary, it was brought to challenge their actions.  The Affidavit of Tsang Lin Yau Linda of 30th August 2022 (“Tsang 1st”), made one day prior to the issue of the writ, alleged that Lee Jun Sing D1 was seeking to do “anything possible” to reduce the Plaintiff’s share in Globalwide and that Lee Jun Wai had connived in the attempt to remove the Plaintiff as executrix of Mr Lee Senior’s estate and administratrix of Mrs Lee’s estate; the complaint was that the Plaintiff, as a beneficiary under Mr Lee Senior’s will, was being cheated of her entitlement thereunder.  In particular, the complaint was that the Plaintiff was being deprived of her entitlement to an interest in the Share.  Had the Plaintiff succeeded in obtaining any interest in the Share in these proceedings, Lee Jun Sing D1 and Lee Jun Wai would necessarily have had their interest reduced.^[16]  It is difficult to see how one can escape the conclusion that the proceedings were brought for the benefit of the Plaintiff personally.

26.  Whatever the figures in Tsang 2nd may purport to show, it is not the case that the Plaintiff had these in mind at the time of commencing the action, and decided that despite being “worse off” if she succeeded in the action (compared to losing and having the First DFA declared valid), she nevertheless decided to pursue the action in the best interests of Mrs Lee’s estate.  After all, it is also the Plaintiff’s stance that at the time, she did not at the time know about the First DFA, so she simply could not have been conducting any comparison as suggested in Tsang 2nd, with or without figures.  Her focus was simply on claiming her interest in the Share.  Indeed, Mr Yau says that the materials on which Tsang 2nd is based would not have been available in 2022 when the notional Beddoe application would have been made.^[17]  Therefore, Tsang 2nd can hardly provide any probative value to the question of whether the proceedings were brought for the personal benefit of the Plaintiff.

27.  In any event, the figures and analysis in Tsang 2nd are questionable.

27.1  How the Plaintiff’s entitlement under the First DFA is calculated is not explained.  Furthermore, the figures do not appear to take into account the liabilities of Mr Lee Senior’s estate.

27.2  Tsang 2nd in fact causes confusion because it does not compare like with like.  Paragraph 17 compares the result of recovering the Share not with not recovering the Share, but with the finding that the First DFA is valid.  Instead, the comparison should be between the result of the Plaintiff succeeding in her claim to a ⅙ interest in the Share^[18] upon successfully annulling the transfer of the Share to Janet Wong D3,^[19] and failing in such a claim.

27.3  Tsang 2nd is ostensibly put forward to show that what was said in the Judgment at [131] (that the Plaintiff was the only person who stood to benefit from the proceedings) is incorrect: see Tsang 2nd paragraph 9.  However, Tsang 2nd then simply proceeds to seek to show that the Plaintiff would allegedly be worse off from succeeding in the proceedings.  It does not demonstrate how any other person would have benefitted from the Plaintiff succeeding in the proceedings.^[20]

27.4  As Mr Miu points out, the comparables used for the rough valuation in Tsang 2nd do not appear to be appropriate comparables as they related to transactions of upper floor units, whereas the units owned by Globalwide were ground floor units, and no adjustment to the unit rate appears to have been carried out to account for this difference.  The valuation is therefore in all likelihood an undervaluation.

28.  Moreover, Tsang 2nd is illogical and therefore not credible: why did the Plaintiff press on with the action even after finding out that she was going to be worse off in the event of success? If it is suggested that it was out of a concern for other beneficiaries or creditors of Mrs Lee’s estate, how can this be reconciled with Tsang 1st, where it was apparent that the Plaintiff was pursuing proceedings because she believed that she was being cheated out of her entitlement under Mr Lee Senior’s Will (by the same beneficiaries of Mrs Lee’s estate)?

C4.  Grounds 3, 4

29.  Mr Yau accepts that the test for determining whether the Plaintiff should be allowed to recoup Ds’ Costs is whether a judge hearing a notional Beddoe application at the time when the claim was made would have granted a Beddoe order: Chan Gordon v Lee Wai Hing (No 2) [2011] 2 HKLRD 1029 at [13].  However, Mr Yau submits that whilst this test was correctly stated in the Judgment at [129], it was wrongly applied, as irrelevant matters were taken into account and relevant matters were left out of account.^[21]

30.  First, it is said that it was wrong to find that the Plaintiff was the only person who stood to benefit from success in the action.^[22]  However, as set out above, Mr Chu in fact confirmed in oral closing submissions that the proceedings were initiated for the benefit of the Plaintiff personally and that she was the only one who would benefit from a successful outcome.  As analysed above, Tsang 2nd does not provide any reliable basis for suggesting that the action was instituted for the benefit of any other person; it is also not reasonably arguable that it would satisfy the Ladd v Marshall criteria.  That being the case, the judge hearing the notional Beddoe application would not have granted a Beddoe order so as to allow the Plaintiff to use the funds of Mrs Lee’s estate in order to pursue a claim solely for her own benefit.  This consideration would have been the overriding one.  It hardly needs saying that the Plaintiff, as administratrix, should have remained neutral rather than siding with a particular beneficiary (whether herself or another): Chan Gordon at [20].

31.  Second, it is said that it was wrong to leave out of account the fact that the First FDA was not disclosed till 27th September 2022. ^[23]  However, it is not reasonably arguable that even though the proceedings were initiated for the benefit of the Plaintiff personally, the Plaintiff would nevertheless have succeeded in obtaining a Beddoe order for the period between 30th August 2022 (when the proceedings were commenced) and 27th September 2022 (when the Plaintiff says she became aware of the First DFA), simply because she was unaware of, or had forgotten that she had signed, the First DFA.

32.  Third, it is said that reference was made to evidence not available at the time of the notional Beddoe application.^[24]  However, the Judgment at [130.1] was pointing out that the Plaintiff’s own evidence was that the First DFA was explained to her at the meeting of 21st August 2019, and that this was consistent with what all the other attendees to the meeting have said, that the Plaintiff did not obtain positive evidence from her own solicitor to support the case of non est factum, and that the Plaintiff has never explained the crucial element of a claim of non est factum, namely, what the difference was between what she thought she signed and what she actually signed.  It will also be recalled that the Plaintiff’s evidence is that she did not give any indication that she did not understand the explanation of the First DFA: Judgment at [100].  In other words, at the time of the notional Beddoe application, the Plaintiff would have had no evidence in support of her claim of non est factum apart from her bare assertion that the First DFA was not explained to her, and she herself would have known that this assertion was false.

D.  DISPOSITION

33.  I do not consider any of the grounds to be reasonably arguable.  I therefore dismiss the Leave Summons and the Evidence Summons, and make an order nisi that the Plaintiff is to pay to the Defendants the costs of and occasioned by both summonses, to be assessed summarily.  The Defendants should lodge and serve their statement of costs within 5 days.  The Plaintiff has leave to lodge and serve a list of objections within 5 days thereafter in bullet point form limited to 2 pages; the Defendants have leave to lodge and serve a reply within 3 days thereafter in bullet point form limited to 2 pages.