MAN CHUNG LEUNG v. MAN WAI SING the executor of the estate of the Deceased MAN HING KWAI AND ANOTHER

HCMP 1205/2024

[2025] HKCFI 4308

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1205 OF 2024

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J U D G M E N T

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Introduction

1.  Mr Man Chung Leung (“Leung”), Mr Man Wai Sing (“Sing”) and Ms Man Lai Yee (“Yee”) are siblings and the late Man Hing Kwai (“the Deceased”) was their lawful and natural father.

2.  Leung commenced these proceedings by an originating summons dated 12 July 2024 (“the OS”) against Sing as the executor of the estate of the Deceased (“the Estate”) and Yee. Principally, Leung asks for the following orders:

(1)  that Sing do provide a true and perfect inventory and account of the Estate (“the Account”) as an exhibit of his affidavit/affirmation pursuant to section 56 of the Probate and Administration Ordinance, Cap.10 (“the PAO”);

(2)  that Sing do allow inspection of all supporting documents in relation to the Account;

(3)  that Leung may be appointed as the executor of the Estate in place of Sing; and

(4)  that all assets and properties of the Deceased be vested in Leung as the substituted executor of the Estate pursuant to section 33(3) of the PAO.

3.  Mr Wong, for Leung, explains that the primary complaint is that Sing has been wholly dilatory in the administration of the Estate in that he has failed and refused to render a full and proper account of the Estate. As a result, there has been little progress in the administration of the Estate and no distribution of Leung’s share in the residuary estate has been made.

Background facts

4.  The Deceased passed away on 7 November 2019, survived by Leung, Sing and Yee. His last will was made on 6 April 2011 (“the Will”).

5.  By the Will, the Deceased

(1)  appointed Sing as the sole executor of the Estate;

(2)  bequeathed all his interest in a shop premises known as Shop No. B28, G/F and cockloft, Hop Yick Plaza, Nos. 2/38 Mau Tan Street, No. 16/20 Hop Choi Street, Nos. 23/27 Tai Tong Road and No. 1/49 Yuen Long New Street, Yuen Long, NT (the “Yuen Long Shop”) to Sing absolutely; and

(3)  directed that all his residuary estate shall be distributed in accordance with the provisions of the Intestates’ Estates Ordinance, Cap.73 (“the IEO”).

6.  Each of Leung, Sing and Yee, being the issues of the Deceased, has an equal interest in the residuary estate pursuant to ss. 4(5) and 5(1)(a) of IEO.

7.  On 2 September 2020, Sing obtained a grant of probate of the Estate with a copy of the Schedule of Assets and Liabilities of the Deceased dated 9 June 2020 annexed thereto (“the Schedule”).

8.  The Schedule shows that the Estate purportedly consists of the Yuen Long Shop and the following things only:

(1)  HKD$3,258.70 in the HKD Savings Account at the Bank of China with account no. 012-588-1-032840-2 (the “032 Account”);

(2)  HKD$1,621.41 in the HKD Savings Account at the Bank of China with account no. 019-588-1-099172-3 (the “099 Account”); and

(3)  Some personal effects in a safe deposit box with the Bank of China with box number 012-588-83-79218-8 including a title deed, some documents, some jewelries, and cash in the respective sums of HK$20,370 and RMB$2,080.

9.  By a letter dated 20 December 2023, Messrs Hampton, Winter and Glynn (“HWG”), acting for Leung, requested Sing to, among other matters, pay to Leung a sum of HK$417,894.00 being his share of the rental income deriving from the leasing of a shop premises known as G/F and Cockloft together with the Exterior Wall facing Nga Tsin Long Road and the Open Yard thereto No.4 Nga Tsin Long Road, Kowloon, Hong Kong (“Kowloon City Shop”).

10.  At present, Leung and Sing are presently the joint registered owners of the Kowloon City Shop. By a Memorandum of Agreement for Sale and Purchase and an Assignment both dated 2 September 1999, the Deceased assigned his interest in the Kowloon City Shop to Plaintiff and D1 as tenants in common.  

11.  Under a covering letter dated 27 December 2023, Messrs Leung Kin & Co (“LK”), acting for Sing, sent to HWG a cheque in the sum of HK$417,583.20 purportedly being the share of Leung of the net income of the Kowloon City Shop.

12.  By another letter dated 5 January 2024, LK sent to HWG a general breakdown of the total income and expenses of the Kowloon City Shop since November 2019.

13.  After LK failed to produce the supporting documents of the purported breakdown, Leung on 7 March 2024, instituted legal proceedings by w an action against Sing personally and as executor of the Estate under HCA 427/2024 (“the Action”).

14.  Thereafter, the parties exchanged extensive correspondence regarding the actual size of the Estate. Such exchanges only enlarged the differences between the parties and the administration of the Estate came to a halt.

15.  Eventually, the OS was issued on 12 July 2024.

Applicable legal principles

16.  The present application is made pursuant to section 33(3) of the PAO, which provides,

“The court may, if satisfied that the due and proper administration of the estate and the interests of the persons beneficially entitled thereto so require, suspend or remove an executor or administrator (other than the Official Administrator) and provide for the succession of another person in place of such executor or administrator and for the vesting in that other person of any property belonging to the estate.”

17.  The legal principles relating to this provision are well‑established and not in dispute.

18.  Mr Wong helpfully draws my attention to Lok Wai Kwan and Ors. v Wong Chi Kau, the executor of the estate of Siu Oi Chu [2025] HKCFI 269 in which H. Au Yeung J made a detailed review of the relevant authorities setting out the legal principles relating to the duty of an executor to keep proper accounts and the removal of an executor under section 33(3) of PAO.

19.  Among such authorities, I find Chow Chak Kiu v Chow Man Chit & Ors. (unreported, HCMP 797/2016, 17.1.2017) and Chan Yu Hong v Chan Kam Hong & Ors. (unreported, HCMP 888/2013, 19.7.2017) to be of particular relevance to the present case.

20.  In Chow Chak Kiu, Chow J (as he then was) explained the duty of administrators in respect of a proper account of the estate in the following terms (at §40):

“Generally speaking, to render a proper account of the estate of a deceased person, the personal representative is required to:-

(1) show the opening balance (including capital assets) and closing balance;

(2) give details of movement of assets, incomes and expenditure of the estate;

(3) give details of the whereabouts of all properties (including cash) of the estate which the personal representative is duty bound to administer; and

(4) support the account with documentary evidence.

See Re Estate of Lee Da Kor [2010] 1 HKLRD 415, at paragraphs 17 and 26 per Jeremy Poon J (as he then was); Charles Yu Chiu Kwan v Edna Yu Chan Shek Yin, HCMP 965/1980 (22 April 1982) per Rhind J (quoted by B Chu J in Leung Wing Hong v Leung Yiu Cho, HCMP 1473/2014 (11 August 2016), at paragraph 104).”

21.  In Chan Yu Hong, B Chu J said this at §§81-82:

“81. It is the duty of administrators to keep clean, clear and accurate account and to be always ready to render such account when called upon to do so, and it is no excuse that they are inexperienced in keeping account as in such cases it would be their duty to employ a competent accountant to keep them. To discharge the duty to account properly, there must be production of the relevant supporting documents and receipts, as well as proper breakdown of items.

82. Further, as stated in Re Leung Kam Wah, HCMP 1473/2014, 11 August 2016, unrep, an administrator must at all reasonable times be ready to render a clear and accurate statement of account to a beneficiary, so that the beneficiary is able to see his entitlement under the trust. It is essential for any accounting system to show at least the opening capital assets, details of the movements of capital assets, the present capital assets, details of income earned, and details of expenditure.”

22.  For the exercise of the court’s discretion to order a removal of an executor or administrator, Wilson Chan, J in Ho Tung Ming Oscar v Ho Fook Shing [2021] HKCFI 1046 set out the guiding principles at §§12 and 13:

“12. In deciding whether to remove an administrator, “the proper question to ask is whether the removal is necessary for the due and proper administration of the estate, and whether it is in the interests of the beneficiaries for the administrator to be removed. That does not mean it is necessary to establish specific wrongdoing, misconduct or fault, though obviously such conduct would be a relevant consideration. A failure to render a full and proper account when called upon to do so, which can be seen as a breach of a fundamental and important duty of an administrator, may in appropriate circumstances be good reason to justify the removal of an administrator.”  (Emphasis supplied) (See: Shum Oi Lun Helen v Wong Yuk Ching, HCMP 1189/2018 (Judgment dated 29/11/2019) at §38 per Coleman J).

13. In Re Estate of Lee Da Kor [2010] 1 HKLRD 415 at §§37 and 39, Jeremy Poon J (as the CJHC then was) held that the executors should be removed as they (a) had failed to render a full and proper account despite repeated requests from the beneficiaries; and (b) had been unjustifiably dilatory in distributing monies belonging to the estates to the beneficiaries. The executors were further held personally liable for the costs of such hostile litigations.” 

23.  Mr Chu, for Sing, draws my attention to Chu Wing Chuen Paul and Ors. v Chu Oi Yan Irene [2022] HKCFI 804 in which Wilson Chan J held that removal of a personal representative is not to be preferred unless the administration is still far from completion.

24.  Mr Chu further helpfully refers to Ng Yeuk Chu Winnie v Ng Sung Kui and Anor. [2021] HKCFI 2116. There, Mr Recorder Stewart Wong SC explained that the overriding consideration is the interest and welfare of the beneficiaries, and the question is what is necessary or required for the due and proper administration of the estate.

Agreed list of issues

25.  The parties have filed an agreed list of issues dated 16 January 2025 pursuant to an order of a master.

26.  I do not find this document helpful. Mr Wong does not deal with each of the issues identified therein. Nor does Mr Chu, for Sing and Yee.

27.  The key factual issue is whether Sing has failed to discharge his duties as the executor of the Estate in that he has not rendered a full and proper account of the Estate after the death of the Deceased in November 2019.

Evidence adduced by the parties

28.  To oppose the present application, Sing has filed altogether 3 affirmations. His 3^rd Affirmation dated 11 April 2025 and his 4^th Affirmation dated 2 May 2025 were filed without leave subsequent to the filing of Leung’s reply affirmation.

29.  Belatedly, Sing attempted to provide a purported updated account of the Estate by his 3^rd Affirmation. Another purported updated account of the Estate was provided by his 4^th Affirmation which includes the Action as the liability of the Estate.

30.  Leung’s present application is based on his suspicion that the Estate consists of far more than what is stated in the Schedule and he believes that Sing is evasive about the actual size of the Estate.

31.  In his supporting affirmation, Leung sets out his basis for his suspicion:

(1)  o his knowledge, the Deceased made investments in both Hong Kong and the Mainland, among other things, in real properties;

(2)  he Deceased had derived considerable rental income from the Yuen Long Shop and the Kowloon City Shop since their acquisition;

(3)  ack in 1988, the Deceased had a time deposit in the amount of HK$1 million with the Kwantung Provincial Bank;

(4)  he Deceased was a frugal person and led a simple life; and

(5)  he Deceased is expected to have accumulated some HK$46 million worth of assets consisting of landed properties and cash in his bank accounts.  

32.  The affirmations of Sing generate more questions than answers. Irrelevant matters aside, his affirmations contain the following allegations:

(1)  The Deceased transferred the legal title of the Kowloon City Shop to Leung and him in September 1999 just to reassure Leung that he was not being excluded from his properties. At a family meeting held in the U.K. (“the Family Meeting”), the Deceased made it clear that despite the transfer of the legal title to the Kowloon City Shop, it was in name only and Leung and Sing should transfer it back to him without protest when he directed them to do so. The Deceased made an instruction that the rental income yielded by the Kowloon City Shop would belong to him and would be used by the Deceased and his wife (“the Instruction”).

(2)  Leung and Sing executed a General Power of Attorney in favour of the Deceased so that he could manage the Kowloon City Shop and collected the rent for his and his wife’s own use.

(3)  Sing, however, instructed his solicitors to provide to Leung copies of his record of the rental income and the expenses of the Kowloon City Shop from November 2019 together with 2 cheques in the respective sums of HK$417,583.20 and HK$59,409.70 representing Leung’s share in the net rental income deriving from the Kowloon City Shop purportedly;

(4)  For the first time, Sing discloses that the Deceased had properties in the Mainland including a 5-storey building and 1/3 share in another 5-storey building. Sing alleges that he is still searching for the legal documents relating to the Deceased’s ownership of these buildings.

(5)  The Deceased and his wife spent lavishly. Sing gave a lot of examples. The Deceased was pleasure seeking and enjoyed life. He went on trips regularly and liked fine dining.

(6)  The Deceased was very generous and he bought his grandchildren a lot of gifts and spent a lot on them. He also employed domestic helpers continuously.

(7)  The Deceased spent a lot for his medical expenses. He relied on private doctors for his chronic diseases. He further paid all of his medical expenses and his wife’s medical expenses for treatments for their cancers.

(8)  The Deceased paid for his and his wife’s burial pots and their funerals.

(9)   The Deceased enjoyed gambling with his friends.

33.  Subsequent to the filing of their evidence pursuant to the order of the master, on 17 March 2025, Sing produced a letter of the Bank of China dated 1 June 2020 (“the BOC Letter”) and a copy of the first page of the consolidated statement of the 032 and 099 Accounts dated 31 October 2019 (“the Statement”).

34.  The Statement shows that there was a “Total Relationship Balance” standing at HK$7,012,333.93. It represents the total amount of the balance in all the accounts under the Deceased’s sole name and the account held in the joint names of the Deceased and another person (“the Joint Account”).

35.  In the BOC Letter, the bank indicated that according to their joint account mandate, the survivorship clause is applicable to the Joint Account.

36.  Leung duly followed up on this matter since Sing had not mentioned about any joint account before. By a letter dated 27 March 2025, Sing referred to the BOC Letter and claimed that by reason of the survivorship clause (“the Survivorship Clause”) in respect of the Joint Account, he became the sole owner of the Joint Account.

37.  For completeness, by his 3^rd Affirmation, Sing purportedly provided an updated account of the Estate, which did not include the Joint Account.

38.  In regard to the estate of the Deceased in the Mainland, Sing alleged that he was refused access to all information by the bank and the relevant authority despite his production of the probate to these institutions. Sing said he was taking legal advice on this matter.

39.  By his 4^th Affirmation, Sing pointed out that in the full account of the Estate provided in his 3^rd Affirmation, he omitted to include the potential liability of the Estate arising from the Action. Therefore, he further provided an updated account of the Estate.

40.  On the other hand, Sing produced an expert report prepared by one Ms Zhao of a law firm in the Mainland (“Expert Report”). The gist of the legal opinion in the Expert Report is that if all the beneficiaries could reach an agreement in relation to the distribution of the estate of the Deceased in the Mainland and they could act in concert, the administration of the estate would be straightforward without any intervention of the court in the Mainland.

41.  I should briefly explain the disputes in the Action. The claim of Leung is that the Kowloon City Shop has been rented out from time to time since it was transferred to Sing and him in September 1999. In his lifetime, the Deceased managed the leasing matters of the Kowloon City Shop and collected rent on his behalf. Such rent collected was held on trust by the Deceased, and after his passing, by the Estate for Leung.  

42.  In his Defence, Sing referred to the Family Meeting and the Instruction. He pleaded that the rental income generated from the Kowloon City Shop during the lifetime of the Deceased had been collected and spent by the Deceased for his own use.

43.  The alternative case is that any claim against the Estate for the return of the rental income held by the Deceased on behalf of Leung should be time-barred pursuant to section 20(2) of the Limitation Ordinance, Cap. 347.

Analysis

44.  There is no dispute that the Estate in fact consists of certain landed properties in the Mainland. Whilst Sing was not required to include these Mainland properties in the Schedule, he cannot be heard to say that by the Schedule, he already gave a full and proper account.

45.  More than 4 years after the grant of probate, the default persists. There has been an indefensible delay in Sing’s performance of the fundamental and important duty of an executor.

46.  The alleged difficulties in dealing with the Mainland properties are unconvincing and in any event Sing has failed to produce solid evidence that he had tried to remove such difficulties before the issue of the OS. There is no reason why Sing had kept all these matters to himself without accounting to Leung and Yee until he filed his 3^rd Affirmation.

47.  The position taken by Sing in respect of the Kowloon Shop Property is questionable. On his own evidence, Leung and Sing could only be the trustees of the Deceased jointly holding the Kowloon City Shop Property on trust for the Deceased.[i]  It should remain to be an asset of the Estate. However, the Kowloon City Shop is not included in the Schedule and Sing never treats it as a part of the Estate. He should not simply share the rental income of the Kowloon City Shop in equal shares with Leung after the passing of the Deceased. Such rental income should go to the Estate.

48.  Given the Deceased’s collection of the rental income of the Kowloon City Shop and the Yuen Long Shop for years, the small credit balances remaining in the 032 Account and the 099 Account cry out for an explanation. Sing has made a forced effort to paint the picture that the Deceased was a lavish spender but his assertions plainly lack credence. There is not an iota of documentary evidence of such expenditures. At least, Sing should be able to produce at least some documentary evidence such as receipts for the payments of the medical expenses of both the Deceased and his wife that the Deceased allegedly made over the years.

49.  Further, I agree with Mr Wong that Sing’s non-disclosure of the Joint Account causes legitimate concerns. Sing has not given any details about the Joint Account and disclosed who the holders of the Joint Account are. He merely relies on the Survivorship Clause to claim sole beneficial interest in the funds in the Joint Account.

50.  As rightly pointed out by Mr Wong, the Survivorship Clause is not determinative of the beneficial interest in the funds in the Joint Account. The ultimate determining factor of ownership of such funds would be the common intention of the joint account holders: Chu Wing Chuen Paul and Ors. v Chu Oi Yan Irene [2022] HKCFI 804 per Wilson Chan J at §49; Nanyang Commercial Bank Ltd v Personal Representative of Vannee Nativiat [2013] 2 HLRD 749 per To J at §40.

51.  In Poon Loi Tak, the Administrator of the late Poon Nuen Deceased v Poon Loi Cheung Desmond [2024] HKCA 796 at §52, Chow JA accepted that a survivorship clause of a joint bank account, often found as part of a bank’s standard terms and conditions in small print, is primarily a contractual arrangement between the bank and the joint account holders on how to deal with the money in the joint account in the event of death of one of the holders. The parties’ (or relevant party’s) intention overrides the survivorship clause. Chow JA also held that for the purpose ascertaining the intention of the parties (or relevant party), the weight that might be given to a survivorship clause depends on the facts and circumstances of the case.

52.  Mr Chu refers to National Provincial Bank Ltd v Bishop and Ors. [1965] 450 and submits that where a joint account was opened for a husband and wife, then in the absence of circumstances which indicated that it was intended for a specific or limited purpose, equity would not intervene to interfere with the beneficial ownership of the funds in the joint account.

53.  I do not think National Provincial Bank Ltd can assist Sing. In that case, Stamp J actually looked at the actual circumstances to ascertain the intentions of the couple relating to the ownership of their joint account and it did not involve any survivorship clause at all.   

54.  Thus, the ownership of the funds in the amount of about HK$7 million in the Joint Account cannot be conclusively determined despite the Survivorship Clause. I am unable to accept Mr Chu’s there is an unrebutted presumption in favour of Sing. I do not accept that because of the demise of the Deceased, there is nothing to show the intention of the Deceased in regard to the actual ownership of the funds in the Joint Account. All the relevant circumstances including the opening of the Joint Account and the ins and outs of the funds in the Joint Accounts should be examined to ascertain the holders’ actual intention. Depending on the determination of the parties’ intention, the Estate may have some if not all the beneficial interest in such funds.  

55.  Sing has not done anything to ascertain the ownership of the funds in the Joint Account. It may be due to his mistaken reliance on the Survivorship Clause. More importantly, he is unable to take a neutral position in this matter as there is clearly a conflict of interest. He is not really in a position to ascertain the actual size of the Estate and properly administrate it.

56.  In view of the foregoing matters, I find that Leung’s complaint about Sing has failed to render a full and proper account of the Estate despite demands is well substantiated on the evidence. Sing has failed his duty as the executor of the Estate and he is also in a position in conflict with the Estate too. The actual size of the Estate is yet to be confirmed. Leung has been unfairly denied distribution of his shares of the Estate due to the dilatory approach of Sing.

57.  Mr Chu impressed this court that the majority view of the beneficiaries should be respected and in the present case, Yee is on the side of Sing and does not support Leung’s application.

58.  In the forefront of my mind should be the due and proper administration of the Estate. I have no confidence in Sing’s administration of the Estate. I should exercise my discretion under section 33(3) of the PAO to remove Sing as the executor of the Estate.

59.  I find no merit in Mr Chu’s submission that the administration of the Estate is close to completion and so it is undesirable to remove Sing. For the reasons given, I opine that there is a great deal to do to administrate the Estate properly.

Substitute administrator

60.  Next, I have to consider who should be appointed as a successor of Sing and take over the administration of the Estate from Sing.

61.  Leung wants to replace Sing. However, I do not believe that he is an appropriate successor.

62.  Leung has already made a claim against the Estate in the Action. He obviously has a conflicting interest in the Estate. He cannot possibly take a neutral position in the administration of the Estate.

63.  Mr Wong is unable to persuade me how Leung can still act as the administrator given the conflict of interest.

64.  On this ground alone, I reject Mr Wong’s suggestion that Leung be appointed to replace Sing.

65.  Unfortunately, neither party has made any suggestion as to who the substitute should be. In the absence of any nomination, I am unable to make the decision for the Estate.

66.  I now direct the parties to file and serve their respective affirmations to make their nominations with full details of their nominees and their written consent to act with 42 days from this order.

Conclusion and order

67.  For the reasons given, I accede to the application by OS and make the following orders:

(a)  Sing be removed as the executor of the Estate pursuant to s. 33(1) of the PAO;

(b)  Sing do exhibit by affidavit filed in the court within 28 days a true and perfect inventory and account of the movable and immovable property of the Deceased, and Leung shall have liberty to inspect the originals of the documents produced by Sing as supporting the account within 14 days thereafter;

(c)  Each party do file and serve an affirmation for the purpose of making their nominations of a substitute administrator of the Estate with full details of their nominees and their written consent to act with 42 days from this order. Each party thereafter do lodge with this court his written submissions thereon not more than 4 pages within 7 days thereafter. This court shall make the decision on paper; and

(d)  Liberty to apply.

68.  For costs, there is no reason why Sing should not bear the costs of the OS, which was necessitated by his refusal to accede to Leung’s demand. On a nisi basis, I order that Leung’s costs of the OS be borne by Sing, including any costs reserved, to be taxed if not agreed. As between Leung and Yee, I make no order as to costs.

69.  Lastly, I thank Mr Wong and Mr Chu for their assistance.