EAST EPOCH INTERNATIONAL LTD v. WONG POON TING

HCA2783/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 2783 OF 2006

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J U D G M E N T

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The core issue

1. The core issue raised in this action is : when a vendor who had contracted to sell his property died before completion, and later the court ordered specific performance of the agreement, would the personal representative of his estate be liable for the damages suffered by the purchaser for the delay in completion?

2. The background circumstances may be summarized as follows.

Background circumstances

3. Situated at No.29 Grampian Road, Kowloon is a three-storey building. 

4. On 25 November 2004, the plaintiff as purchaser entered into three provisional sale and purchase agreements with the owners of G/F, 1/F and 2/F of the building as vendors at the price of HK$16,666,667 each.   The owners knew that the plaintiff was buying all their property at the same time.  The plaintiff paid each of them HK$1,666,666.70 as deposit and part payment, leaving a balance of HK$15,000,000.30 to be paid on completion on or before 23 March 2005.

5. Completion for G/F and 2/F took place as agreed.  It did not for the 1/F (“the Property”).

6. The registered owner of the Property was Madam Leung Wai Fong.  On 1 December 2004, she died intestate at the age of 86.  Messrs Hastings, who represented Madam Leung before her death and thereafter, the defendant, her eldest son and one of the beneficiaries of her estate, informed the plaintiff’s solicitors, Messrs Simon Siu, Wong, Lam & Chan (“SWLC”), of the same two days later.  By letter dated 6 December 2004 and repeated requests subsequently, SWLC asked Hastings if they had instructions to act for the personal representative(s) of Madam Leung and to proceed with the sale and purchase of the Property.

7. On 28 February 2005, the defendant applied through Hastings for the grant of letters of administration.  Because of, among other things, the disputes that Mr Wong had had with other alleged beneficiaries, his application remains outstanding to date.

8. SWLC wrote to Hastings again on 14 March 2005.  They stated that Hastings’ client (the defendant, presumably) had requested an extension of three months for completion.  In his affirmation filed on 11 May 2007, the defendant alleged that the plaintiff had agreed to extend the time for completion to 23 June 2005.  But the defendant is no longer relying on this alleged extension because it does not feature in either the defence, the agreed facts or the submissions of his counsel, Mr Chain.

9. Hastings replied to SWLC by letter dated 16 March 2005 that “there were still some negotiation discussions amongst various beneficiaries” and they would keep the plaintiff’s solicitors “informed of the progress”.

10. On 23 March 2005, SWLC, for the purpose of completion, sent Hastings a cheque drawn in their favour for HK$15,000,000.30 (“the Cheque”) being the balance of the purchase price payable against various undertakings to be given by Hastings :

“1. To send to us within seven (7) days from the date of your receipt of this letter :—

(a)   The Assignment enclosed herewith of the above property to be dated no later than the Completion Date duly executed by the Vendor, the Executor or the Administrator of the estate of [Madam Leung] (who must be properly identified) and attested;

(b)   Certified copy of Death Certificate of [Madam Leung] duly registered;

(c)   Certified copy of Probate/Letters of Administration of the estate of [Madam Leung] with Certificate of Exemption of Estate Duty or Certificate of Estate Duty duly paid annexed thereto duly registered;

(d)   All title deeds and documents of [the Property] remaining in your or your client’s possession to which our client(s) is/are entitled.

…”

11. Hastings replied on the same date that while the defendant was applying for the letters of administration, they were unable to accept the undertakings imposed by SWLC.  They proposed to replace them by :

“1. To hold [the Cheque] as stakeholders and not to release the same to the intended Administrator of the estate of [Madam Leung] unless and until :—

(a)  Letters of Administration of the estate of [Madam Leung] has been issued; and

(b)  The Assignment (to be approved by you) of [the Property] has been executed by the intended Administrator of the estate of [Madam Leung] after the issue of the Letters of Administration.

2.   To send to us within seven (7) working days after the date of execution of the Assignment of [the Property] by the intended Administrator of the estate of [Madam Leung].”

12. The practical effect of the undertaking proposed by Hastings, if accepted, was to postpone completion until such time as and when the letters of administration were issued and the administrator (presumably the defendant) had executed the assignment.  But on the evidence before me, it is simply not clear when that would take place.

13. SWLC then replied that “it is and was” the plaintiff’s intention to complete and they noted that “the vendor of the Property and/or its [personal] representative, if any, will be in breach of the provisional agreement.”

14. On 24 March 2005, Hastings returned the Cheque to SWLC.

15. By letter dated 30 March 2005, SWLC put on record that Hastings’s client had failed to complete and that such breach and delay would cause the plaintiff loss and damage.

16. Further correspondence was then exchanged between SWLC and Hastings.  Three points are to be noted :

(1) Hastings informed SWLC of the progress in the application by the defendant for the letters of administration.

(2) By letter dated 26 January 2006, SWLC proposed that a joint application be made for a special grant for completion of the sale and purchase of Property.  Other than the letter dated 8 February 2006 seeking the basis and authority for the proposed application, Hastings did not follow up on the matter despite repeated reminders from SWLC in March and May 2006.

(3) By letter dated 24 November 2006, SWLC referred to the said proposal and made an alternative proposal that if Hastings’ client had any hesitation about a joint application, the plaintiff would apply to court by commencement of proceedings.  Hastings replied by letter dated 1 December 2006 that the defendant in principle agreed with the alternative proposal.  By another letter dated 21 December 2006, Hastings confirmed that the defendant was willing to act as personal representative in the intended action to be commenced by the plaintiff for appointment of such representative for Madam Leung’s estate.

17. On 15 December 2006, the plaintiff commenced the present action against Madam Leung’s estate for specific performance of the provisional sale and purchase agreement for the Property and damages.  By order dated 12 January 2007, the master appointed the defendant to represent her estate and ordered that the present action be carried against him as if he had been substituted for Madam Leung’s estate.

18. By summons dated 26 March 2007, the plaintiff applied for summary judgment for specific performance and inquiry for damages.  On 16 April 2007, the master entered judgment for specific performance, pursuant to which completion later took place on 31 May 2007.  The master adjourned the inquiry for damages for substantive argument.  On 13 September 2007, another master who, having heard the parties, gave the defendant unconditional leave to defend.

19. The parties had since agreed to have a spilt trial on liability first, which eventually came before me.  For the purpose of the trial, the parties proceeded on the basis of a schedule of agreed facts (annexed to this judgment).  The affirmations of Steven Yau Sun Chi, manager of the plaintiff, and the defendant were also admitted without cross-examination.  No oral evidence was adduced.

The main defence

20. The plaintiff claimed damages occasioned by the delay in completion of the sale and purchase of the Property.  Voluntary particulars of the loss and damage were supplied shortly before the commencement of the trial in response to my query raised at the Pre-trial Review.  But since I am only concerned with liability, I will just leave them as they are.

21. In opposing the plaintiff’s claim, the defendant pleaded that there was no delay in completion by relying on two points.

22. First, the plaintiff did not tender performance on 23 March 2005 by sending the Cheque to Messrs Hastings.  And thereafter neither party had appointed any fresh date for completion.  Though not explicitly pleaded, as expanded in Mr Chain’s submissions, the point is that the time for completion had been extended beyond 23 March 2005.

23. Second, since no administrator had been appointed for Madam Leung’s estate, completion could not have taken place on 23 March 2005.  This temporary impossibility was a lawful excuse for the non-performance until there was a grant of letters of administration of Madam Leung’s estate.

24. The defendant then pleaded, alternatively, that even if the plaintiff had suffered loss and damage for the delay in completion, it had failed to mitigate its damages.

Agreed issues

25. The parties had agreed on the following issues :

“1. Whether the plaintiff had tendered performance on the date of completion by sending the Cheque to Messrs Hastings?  (‘Issue 1’)

2.   Whether, in the circumstances, the defendant was in breach of the agreement on 23 March 2005, pending the grant of letters of administration of Madam Leung’s estate or an appropriate court order, or whether the defendant was excused from proceeding to completion?  In other words, whether the death of Madam Leung constituted any legal excuse which could at law absolve the Estate from liability under the agreement? (‘Issue 2’)

3.   Whether the plaintiff has failed to mitigate its damages, and whether such mitigation required the plaintiff to obtain an order from the court pursuant to sections 36 or 54 of the Probate and Administration Ordinance [Cap. 10] (‘PAO’), and/or to approach the Official Administrator? Alternatively, whether any such obligations fell on the defendant? (‘Issue 3’)

4.   If the defendant was in breach of the agreement, whether the same was caused by difficulty in showing title, and in the circumstances, whether the rule in Bain v Fothergill[(1870-71) LR 6 Ex 59] applies? (‘Issue 4’)”

I will address them in a moment.

The defendant’s liability

26. At this juncture, I will deal with the defendant’s liability according to the applicable principles.

27. Obligations to which a deceased was subject are binding on his personal representatives unless they were personal to the deceased.  Thus a representative must perform contracts entered into by the deceased.  He can be sued in respect of causes of action affecting the deceased.  The personal representative is bound, to the extent of the estate, to perform the deceased’s obligations.  See Williams, Mortimer & Sunnucks on Executors, Administrators and Probate, 2008 Edn, para.48-02 at pp.637–638, para.48-04 at p.639; Chitty on Contracts, Vol.1, 31^st Edn, para.20-005 at p.1371 and para.20-008 at p.1372.  These principles apply to a contract of sale and purchase of land.

28. Accordingly, if the vendor died after signing the sale and purchase agreement and before completion, his personal representative must still complete the sale at the date of completion.  See Hong Kong Conveyancing Law and Practice, Part XIV, para.31 at p.13.

29. It is incumbent on the personal representative to take all necessary steps to ensure that he can complete the sale at the date of completion.  In the case of intestacy, if the letters of administration are yet to be granted, an expedient way to proceed is for him to obtain a limited grant for the purpose of completion under section 36 of PAO.  Cf. Williams, Mortimer & Sunnucks on Executors, Administrators and Probate, supra, para.48-07 at pp.641–642.

30. If there is delay in completion, the personal representative is liable for any loss and damage suffered by the purchaser inasmuch as the deceased, if alive, would be liable.  Cf. Re Daniel; Daniel v Vassall [1917] 2 Ch. 405 per Sargant J at pp.409–410.

31. When the purchaser sued for damages for delay in completion, it is in general immaterial why the vendor failed to fulfil his obligation : See Raineri v Miles & Ors [1981] AC 1050, per Lord Edmund-Davies at 1086D–1087C.  The same is true for a personal representative.  Cf. Re Daniel; Daniel v Vassall, ibid.

32. In England, the above principle is subject to a special exception.  According to the rule in Bain v Fothergill, ibid, if the reason for the discharge of the contract is the fact that the vendor is unable to make good title, the purchaser will recover the deposit, interest thereon, and conveyancing expenses but nothing else if the defect in the title is “one of title”.  It should be noted that the rule does not absolve the vendor’s liability completely but only limits the extent of his liability.  But the rule in Bain v Fothergill, based upon conveyancing practice in the 19^th Century England, does not apply to modern Hong Kong.  See Grand Trade Development Ltd v Bonance International Ltd [2001] 3 HKC 137, per Le Pichon JA at pp.154G–156H. 

33. Subject to the discussions below, the defendant is liable under the above principles for the damages arising from the delay in completion.

34. I now turn to consider the agreed issues to see if they offer the defendant any valid defence.

Issue 1

35. The general principle of tender is helpfully summarized in Chitty on Contracts, 31^st Edn, para.21-083 at p.1446 :

“In many cases a party to a contract cannot complete his obligations without the concurrence of the other party, e.g. without his acceptance of goods when delivered, or his acceptance of money paid over.  If the other party refuses to accept performance in such cases, he is preventing the promisor from fulfilling his contractual obligations, and the plea of tender is available to the promisor as a defence to a subsequent action against him for failure to perform.  The plea is that the defendant has always been willing to complete his side of the contract, and has in fact done so as far as is possible without the concurrence of the other party.  A plea of tender must be established by showing that the promisor made an unconditional offer to perform his promise in terms of the contract but that the promisee refused to accept performance. …”

In my view, whether a party has tendered performance must depend on the terms of the contract.

36. Here, the solicitors’ correspondence clearly showed that they intended to complete the sale by undertaking, which is the usual conveyancing practice in Hong Kong.  Under this practice, the balance of the purchase money will be delivered to the vendor solicitor within the time limit set out in the sale and purchase agreement, and the executed assignment is handed over to the purchaser’s solicitor together with an undertaking from the vendor’s solicitor to hand over the relevant documents of title (and the executed assignment if it has not been handed over already) within a specified time.  See Halsbury’s Laws of Hong Kong, Vol.16 (Land), para.230.0224 at p.181; Edward Wong Finance Co. Ltd v Johnson Stokes & Master (a firm) [1984] 1 AC 296.  The obligation imposed by this conveyancing practice on the purchaser to fulfil his side of the bargain for completion is to tender, within time, the balance of the purchase price together with the requisite, genuine undertaking to effect the completion.  Once that is done, the purchaser has tendered performance.  That was precisely what the plaintiff’s solicitors had done when they sent the Cheque to Hastings on 23 March 2005.

37. The defendant pleaded :

“(h)    on 23^rd March 2005 being the completion date under the Agreement, the only step taken by the Plaintiff towards completion was to send Hastings a cheque drawn in favour of Hastings for $15,000,000.30 being the balance of the purchase price against various undertakings to be given to Hastings;

(i)  by letter dated 23^rd March 2005, Hastings informed the Plaintiff’s solicitors that ‘while (their) client was applying for the letters of administration of the Estate, they were unable to accept the imposition of the undertakings’, and on behalf of the intended administrator proposed alternative undertakings;

(j)  the proposals by the intended administrator were not accepted by the Plaintiff, the cheque for $15,000,000.30 was returned to the Plaintiff’s solicitors by Hastings on 24^th March 2005;

(k) in the premises, on the date of completion, there was never any unconditioned tender of the balance of purchase price by the Plaintiff to the party entitled to receive the balance of the purchase price;

(l)  by reason thereof the Plaintiff has not tendered performance on 23^rd March 2005;

(m)    thereafter neither party appointed any fresh date for completion;

…”

The defendant seemed to be contending that the payment of the balance of the purchase price must be wholly unconditional or that SWLC ought to have accepted the undertaking proposed by Hastings.

38. However, as I have pointed out, the conveyancing practice adopted by the parties did not require wholly unconditional payment of the purchase price as such.  Further, any undertaking accompanying the payment must be genuinely for the purpose of completion.  But what Hastings had proposed, as I have observed, was to postpone the completion for an unknown period of time.  The plaintiff was perfectly entitled to reject it.

39. Mr Chain argued that the plaintiff had not tendered performance on 23 March 2005 because as the plaintiff was well aware, there was no proper party to tender performance to.  Since both the plaintiff and the defendant were at fault for the non-completion, completion had thereby been extended to a reasonable time after 23 March 2005.  But the parties had to fix the time for completion by giving notice : Camberra Investment Ltd v Chan WaiTak [1989] 1 HKLR 568.  Since no such notice had been given, no delay arose.

40. While it is true that strictly, Hastings did not represent Madam Leung’s estate since her death, the defendant had all along, acting through Hastings, represented that he had taken out an application for grant of the letters of administration and that he was willing to complete.  Under such special circumstances, the plaintiff had done so far as was possible to fulfil its obligation for completion by sending the Cheque to Hastings with the proposed undertaking.  So contrary to Mr Chain’s submission, I hold that the plaintiff had tendered performance.

41. Further, as will become apparent in a moment, the absence of a proper party to receive payment of the price on 23 March 2005 was caused by the defendant’s fault.  The plaintiff was not at fault for the alleged failure to tender performance at all.  So Camberra Investment Ltd v Chan Wai Tak, ibid. would not apply in any event.

42. Contrary to the defendant’s argument, the time for completion had not been extended beyond 23 March 2005.

Issue 2

43. I next turn to Issue 2.

44. Mr Chain argued that as a matter of law, in the event that there is no one to represent a deceased vendor to execute an assignment, that obligation is suspended and the estate cannot be and is not in breach of contract.  The temporary impossibility occasioned by the absence of a proper person to represent the estate at the time of completion had rendered completion temporarily impossible.  That provided a lawful excuse for the delay until the grant of letters of administration for Madam Leung’s estate.  He relied on Cricklewood Property & Investment Trust Ltd v Leighton’s Investment Trust Ltd [1945] AC 221, per Lord Russell at pp.233–234 and Treitel’s Frustration & Force Majeure, 2^nd Edn, paras.5-057–5-059 at pp.252–253.

45. The facts in Cricklewood Property were summarized in the head note thus :

“    By a building lease dated May 12, 1936, certain land, forming part of a building estate, was demised to lessees for a term of ninety-nine years, to be used by them as sites on which they covenanted to erect a number of shops within a time limit.  So far as concerned each of the sites here in question, the rent reserved was a peppercorn till the expiration of one year from notification by the lessors that erection of a shop thereon might proceed, under the terms of a town planning scheme then in force, and thereafter 35^l. yearly.  Notification having been given in respect of the sites, the lessors claimed payment of the ground rents.  The lessees repudiated liability on the ground that the obligation to pay rent had been excused or discharged by frustration, since the war-time restrictions placed by the Government on building had made it impossible to erect the shops :—

…”

The House of Lords unanimously held that even if the doctrine of frustration could apply to a lease, the circumstances did not justify such application; the lease had not been determined by frustration, and the liability for rent continued.

46. After rejecting the contention that the doctrine of frustration applied to put an end to a lease, Lord Russell said at pp.233–234 :

“The contractual obligations [under a lease] of each party are merely obligations which are incidental to the relationship of landlord and tenant created by the demise, and which necessarily vary with the character and duration of the particular lease.  It may well be that circumstances may arise during the currency of the term which render it difficult, or even impossible, for one party or the other to carry out some of its obligations as landlord or tenant, circumstances which might afford a defence to a claim for damages for their breach, but the lease would remain.”

47. When properly understood, it can be readily seen that his Lordship’s observation was directed to cases involving landlord and tenant only.  He had not laid down any general principle of contract law that if there existed some form of temporary impossibility which rendered the performance of a party’s obligation under a contract temporarily impossible, he would be excused.

48. The passages in Treitel that Mr Chain sought to rely on read :

“Temporary impossibility which is not sufficiently serious to frustrate a contract may have as number of other legal effects; in this respect it resembles partial impossibility.

(1)  Excuse for non-performance

First, the party whose performance is temporarily impossible may have a temporary excuse for non-performance.  For example, even where the illness of an employee was not of such a duration as to frustrate his contract of employment, the employee would not be in breach of the contract through failing to work while he was ill.  The excuse can, it seems, extend to cases in which the employee is temporarily prevented from performing by other causes beyond his control: the example has been given of a teacher who is locked in a school lavatory ‘through no fault of his own’.  The same principle can apply to temporary impossibility in other types of contracts.  It has, for example, been held that a tenant was not in breach of his covenant to redevelop a site by a specified date where the redevelopment was prevented by an order listing a building on the site as one of special architectural interest.  In these cases, the excuse is provided by law. …

  The possibility that a supervening event may give one party a temporary excuse for non-performance (without discharging the contract) is not restricted to contracts for the provision of services.  It was, for example, applied in the American case of Patch v Solar Corp where an agreement was made granting a licence to use a patent; …”

49. None of the cases referred to in Treitel concern contracts of sale and purchase of land.  And Mr Chain has been unable to cite any authority where this doctrine of temporary impossibility applied to such contracts.

50. In the absence of any direct authority, I am not prepared to hold that the doctrine of temporary impossibility applies to a claim for damages for delay in completing a contract for sale and purchase of land.  I decline to do so because in my view, this doctrine does not sit well with the well established principle that the reasons for failure to complete or delay in doing so on the part of the vendor is immaterial to the purchaser’s claim for damages arising from the delay in completion.

51. Even if, as a matter of law, the doctrine of temporary impossibility is applicable to a contract for sale and purchase of land, it is not available to the defendant on the facts of this case.  As I understand it, the doctrine applies only if the temporary impossibility arose through no fault of the party seeking to invoke it.  For plainly one cannot rely on his own fault to make good a lawful excuse for his failure to perform or delay in performing a contract.  Here, Madam Leung died on 1 December 2004, more than three months before the completion date.  Although no letters of administration had been granted, the defendant ought to have applied for a limited grant for the purpose of completion well before 23 March 2005. That he had singularly and inexcusably failed to do, resulting in the absence of a proper person to represent Madam Leung’s estate on the date of completion.  In such circumstances, the defendant cannot invoke the doctrine of temporary impossibility.

Issue 3

52. Mr Chain argued that the plaintiff ought to have taken various steps to complete the sale including making an application under sections 36 and 54 of PAO for a special grant or an order, as the case may be, and approaching the Official Administrator for assistance.  I disagree.  The steps suggested should have been undertaken by the defendant.  It would be far too onerous and indeed wholly unreasonable to ask the plaintiff, a vendor, to do so.

53. Further, the plaintiff did on 26 January 2006 suggest to Hastings to take out a joint application for a special grant in order to complete the sale, which was refused by the defendant.  It does not now lie in his mouth to say that the plaintiff had not taken all reasonable steps to mitigate.

Issue 4

54. The defendant’s delay in completion had nothing to do with any difficulty in proving title.  And as observed above, the rule in Bain v Fothergill does not apply.

Conclusion

55. For the above reasons, the defendant has no defence to the plaintiff’s claim.  I hold that the defendant is liable for the loss and damage suffered by the plaintiff arising from the delay in completion.  There will be judgment on liability accordingly.  I further order that the damages are to be assessed by a master.

56. Costs should follow the event.  There will be an order nisi that the defendant shall pay the plaintiff costs of the trial, including all costs reserved, to be taxed if not agreed.

Annex

LIST OF AGREED FACTS FOR THE TRIAL OF LIABLIITY

  (Unless stated otherwise, the terms used herein are as defined in the Statement of Claim dated 15^th December 2006).

1. The Deceased was the registered owner of the 1^st floor of a three-storey building (“the Building”) at No.29 Grampian Road, Kowloon (“the Property”).

2. The Deceased was born on 13^th August 1918 and was 86 years old at the time of her death, i.e. 1^st December 2004.

3. By three provisional sale and purchase agreements all signed at the offices of Hastings, the solictors for the Vendors, at the same time on 25^th November 2004, the Vendors each agreed to sell their respective properties to the Plaintiff at the price of HK$16,666,667.00.

4. The other 2 sale and purchase agreements were for the sale and purchase of the ground and 2^nd floors of the Building.

5. The said three provisional agreements for sale and purchase contained identical terms (including the same Rider 14).

6. It was agreed that completion would take place on or before 23^rd March 2005 but the Deceased died intestate on 1^st December 2004.

7. The Plaintiff duly paid to the Deceased all of the agreed purchase price pursuant to the Agreement it had with the Deceased (“the Agreement”) except the final balance of HK$15,000,000.30 which was payable upon completion on or before 23^rd March 2005.

8. The Plaintiff had the financial ability to pay the outstanding sum of the agreed purchase price for completing the sale and purchase on or before 23^rd March 2005 as agreed under the Agreement.

9. No completion of the sale and purchase of the Property occurred on or before the agreed date of completion as referred to in the Agreement, namely 23^rd March 2005.

10. The sale and purchase of the Ground Floor and the 2^nd Floor of the Building was duly completed on 23^rd March 2005 as agreed.

11. Wong Poon Ting is the eldest son of the Deceased and was at all material time and still is a beneficiary of the Deceased’s estate.

12. Wong Poon Ting applied for estate duty clearance for the Deceased’s estate by using assets in the Deceased’s estate as security.

13. The Estate Duty Office would not issue any provisional estate duty clearance papers for the estate of the Deceased unless there was security being offered to the Estate Duty Office which in the opinion of the Estate Duty Office would be sufficient to secure the payment of any outstanding estate duty and interest.

14. There was at all material times sufficient assets in the estate of the Deceased which could be used as security for the issuance of the estate duty clearance papers for the Deceased’s estate.

15. Only the person declaring to be the intended person to apply for a grant of representation to the estate of the Deceased (and in our case Wong Poon Ting) would be accepted by the Estate Duty Office as being entitled to offer or use the assets of the Deceased’s estate to apply for provisional estate duty clearance.

16. Without payment of outstanding duty and interests or offering security in form and value satisfactory to the Estate Duty Office, the latter would not issue any provisional estate duty clearance for the Deceased’s estate.

17. Neither Wong Poon Ting nor the Plaintiff had, at any time after the death of the Deceased, approached the Official Administrator to ask the Official Administrator to execute an assignment of the Property to the Plaintiff.

18. Neither Wong Poon Ting nor the Plaintiff had, at any time after the death of the Deceased, applied for a vesting order pursuant to Section 45 of the Trustee Ordinance, Cap.29 for purpose of completing the sale and purchase of the Property.

19. Neither Wong Poon Ting nor the Plaintiff had, at any time after the death of the Deceased, applied for an order pursuant to Section 36 or Section 54 of the Probate and Administration Ordinance, Cap.10 for purpose of completing the sale and purchase of the Property.

20. Wong Poon Ting obtained the Provisional Certificate of Receipt of Estate Duty on 17^th August 2006.

21. Under Caveat No. HCCA854 of 2006, Wong Sau Lin, Wong Marian Shuk Har and Wong Wing Hong claimed to be three of the beneficiaries of the Deceased’s estate under intestacy laws.

22. By an Appearance to Warning filed on 21^st July 2006, Wong Sau Lin and Wong Marian Shuk Har claimed to be the daughters of a union of concubinage and Wong Wing Hong claimed to be the son of a union of concubinage to which the Deceased’s husband was the male partner and Wong Sau Lin, Wong Marian Shuk Har and Wong Wing Hong claimed interest in the Deceased’s estate as issues of the Deceased.

23. The Certificate of Receipt of Estate Duty, issued by the Inland Revenue Department, dated 17^th August 2006 shows that the provisional aggregate total value of the estate is HK$105,669,400.00.

24. A complete bundle of correspondence between solictors are produced and annexed herewith. The following constituted some of the communication via correspondence between solictors.

(a)  The Plaintiff learned of the Deceased’s death through a letter dated 3^rd December 2004 from Hastings.

(b) On receiving notice of the Deceased’s death, the Plaintiff through its solicitors by letter dated 6^th December 2004 inquired with Hastings about, inter alia, whether Hastings had instructions to act for the personal representative(s) of the Deceased and to proceed with the sale and purchase under the Agreement.

(c)  The Plaintiff’s solictors had to issue reminders to pursue an answer to their aforesaid inquires.

(d) By letter dated 16^th March 2005, Hasting informed the Plaintiff’s solictors that “there were still some negotiation discussions amongst various beneficiaries of the deceased” and that they would keep the Plaintiff’s solicitors “informed of the progress of this case in due course”.

(e)  On 23^rd March 2005 being the date of completion, the Plaintiff for purpose of completion sent to Hastings a cheque drawn in favour of Hastings for HK$15,000,000.30 being the balance of purchase price payable against various undertakings to be given by Hastings.

(f)   By letter dated 23^rd March 2005, Hastings confirmed that while their client was applying for Letters of  Administration to the Estate, they were unable to accept the undertakings imposed on behalf of the Plaintiff.

(g)  By the same letter of 23^rd March 2005, Hastings proposed amendments to the draft undertaking letter provided by the Plaintiff’s solicitors for completion of the sale and purchase of the Property.

(h)  The Plaintiff’s solictors in their letter dated 23^rd March 2005 to Hastings stated that “it is and was” their client’s intention to complete the sale and purchase in accordance with the Provisional Agreements and that they note that the vendor of the Property and/or its [personal] representative, if any, “will be in breach of the Provisional Agreement”.

(i)    Hastings returned the cheque for HK$15,000,000.30 to the Plaintiff’s solicitors on 24^th March 2005.

(j)    By a letter dated 30^th March 2005, the Plaintiff put on record that the Defendant had failed to complete the sale and purchase and that such breach and delay would cause the Plaintiff to suffer damages.

(k)  By letter dated 4^th April 2005, Hastings again informed the Plaintiff’s solictors that their client “is in the course of applying” for Letters of Administration of the Estate.

(l)    Hastings by their said letter dated 4^th April 2005 also confirmed that it had all along been their client’s intention to sell the Property in accordance with the Agreement.

(m)   When asked by the Plaintiff’s solicitors by letter dated 7^th October 2005 for progress of the matter, Hastings replied by letter dated 10^th October 2005 to say their client “is in the course of applying the Estate Duty Clearance papers”.

(n)  When subsequently asked for progress of the matter by the Plaintiff’s solictors, Hastings by letter dated 23^rd December 2005 replied that their client was still “applying the Estate Duty Clearance papers”.

(o) The Plaintiff’s solicitors by letter dated 26^th January 2006 proposed that a joint application be made for a special grant for completion of the sale and purchase of the Property.

(p) Hastings replied by letter dated 8^th February 2006 to ask for, inter alia, the basis and authority for the proposed application for a special grant.

(q) The Plaintiff’s solicitors replied by letter dated 15^th February 2006 but there was no further follow-up by Hastings on the proposed special grant despite the Plaintiff’s solicitors’ reminder respectively on 8^th March 2006 and 8^th May 2006.

(r)   On 25^th May 2006, the Plaintiff’s solicitors wrote to Hastings to put on record that it had not received a reply to its letter dated 8^th May 2006 and inquire about their client’s application for estate duty clearance; the Plaintiff’s solictors in the same letter also stated that the Plaintiff had withheld legal action in view of the pending application to the Inland Revenue Department and the intention of the client of Hastings to apply for a grant.

(s)  Hastings by letter dated 29^th May 2006 informed the Plaintiff that their client was “in the course of applying the Provisional Estate Duty Clearance papers”.

(t)    Hastings informed the Plaintiff’s solictors by letter dated 14^th September 2006 that the provisional estate duty clearance papers of the Deceased’s estate had been issued on 11^th September 2006.

(u)  The provisional estate duty clearance papers were dated 17^th August 2006. Wong Poon Ting applied for amendment of the provisional estate duty clearance papers and the latter were amended respectively on 11^th September 2006 and 31^st October 2006.

(v)  Hastings by letter dated 3^rd November 2006 supplied to the Plaintiff’s solictors a copy of the estate duty clearance papers amended up to 31^st October 2006.

(w)    The Plaintiff’s solictors by letter dated 24^th November 2006 referred to their said proposal of a joint application to Court and made an alternative proposal that if the Defendant had hesitation about such joint application, the Plaintiff would apply to Court by commencement of proceedings.

(x)  Hastings by letter dated 1^st December 2006 replied that “our client in principle agree to your client’s proposal.................”.

(y)  The Plaintiff’s solictors in their letter dated 5^th December 2006 asked Hastings to confirm whether they had instructions to accept service.

(z)  The Plaintiff’s solictors had to issue reminder on 12^th December 2006 to Hastings for them to respond.

(aa). By letter dated 13^th December 2006 Hastings informed the Plaintiff that they were seeking opinion from counsel.

(bb). By letter dated 21^st December 2006, Hasting claimed that their client Wong Poon Ting was willing to act as personal representative in the intended proceedings to be commenced by the Plaintiff for appointment of such representative for the Estate.

(cc). By the same letter, Hastings unilaterally imposed conditions which included a condition that the Plaintiff would claim only for specific performance as to completion of the sale and purchase of the Property but not for other losses or damages or for costs.

(dd). The Plaintiff through its solictors by letter dated 27^th December 2006 rejected the conditions unilaterally imposed in the said letter dated 21^st December 2006 from Hastings.

(ee). Hastings in their letter dated 11^th January 2007 in reply to the letter dated 9^th January 2007 from the Plaintiff’s solictors insisted that their client would contest the Plaintiff’s proceedings if the Plaintiff did not accept their aforesaid conditions.

(ff). Hastings in its letter dated 17^th January 2007 to the Plaintiff’s solicitors stated that they were “not in a position to apply for a representative order on behalf of their client.

(gg). Hastings in its letter dated 23^rd January 2007 to the Plaintiff’s solictors for the first time stated to the Plaintiff that their client’s full name is “Wong Poon Ting Tim”.

(hh). Hastings by letter dated 12^th April 2007 insisted that they would provide the title deeds and documents to the Plaintiff’s solictors when the court order for the conveyance of the property was made.

(ii). The Plaintiff’s solictors by letter dated 12^th April 2007 queried why Wong Poon Ting for the estate conceded to specific performance but still refused to provide title deeds and documents of the Property.

25. Pursuant to the ex parte application of the Plaintiff, the Court on 12^th January 2007 ordered inter alia that Wong Poon Ting be appointed to represent the estate of the Deceased on the ground that the Deceased passed away on 1^st December 2004 in Hong Kong and grant of letters of administration has not been issued by the Probate Registry and that the action HCA2783/2006 commenced by the Plaintiff be carried on against Wong Poon Ting as if he had been substituted for the estate of Leung Wai Fong, deceased.

26. The Court on 16^th April 2007 ordered that the Agreement be specifically performed and carried into execution and that the issue of damages be adjourned for substantive arguments.

27. Completion of the sale and purchase of the Property took place on 31^st May 2007.

28. Wong Poon Ting made an affirmation on 25^th February 2005 for estate duty clearance and his Solicitors Messrs. Hastings sent the same to the Commissioner of Estate Duty by letter dated 28^th February 2005.

29. On 10^th September 2008, Wong Poon Ting applied to the Probate Registry for the grant of Letters of Administration of the estate of the deceased vendor under the proceedings no.HCAG008452/2008.