LIE MIAO LIEN AND ANOTHER v. PURNAKARYA WIBAWA AND ANOTHER

1995, No. P1

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PROBATE ACTION NO. 1 OF 1995

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ASSESSMENT OF DAMAGES

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1. Both Plaintiffs and the 1st Defendant were co-executors appointed under a Will of the Deceased to administer his estate. This is an action brought by the Plaintiffs against the 1st Defendant for breach of trust in (a) failing to co-operate with the Plaintiffs in the distribution of most of the assets to the beneficiaries, and (b) the unauthorized disposal of a substantial amount of shares listed in the Hong Kong Stock Exchange. The Plaintiffs claimed against the 1st Defendant for a number of reliefs including his removal as an executor and for damages to be assessed. The 2nd Defendant was joined by reason of it being the Registrar of the shares in question.

2. On 11 April, 1995, in the absence of the 1st Defendant, an Order was made against the 1st Defendant ordering inter alia his removal as an executor and for damages to be assessed.

3. On 4 May, 1998, the matter came before me for those damages to be assessed. As has happened in earlier proceedings of this action, the 1st Defendant failed to appear despite the relevant papers and notice of the hearing having been served on him in Indonesia. In the circumstances, I considered that it was appropriate for the assessment to proceed in his absence and such was done. This is the Judgment of such assessment.

4. The Plaintiff called 3 witnesses to prove its case on the quantum of damages. They are the 1st and 2nd Plaintiffs and an accountant, Mr. Thomas Yue-ting Wong, who prepared a report on the market value of the missing shares. I have considered their testimony and find their testimony to be truthful and reliable insofar as it is relevant to the quantum of damages. I also accept the expertise of Mr. Wong and his evidence relating to the valuation of the shares.

5. The 1st and 2nd Plaintiffs' testimony is in essence related to how they discovered the 1st Defendant had wrongfully disposed of the shares in question and what types and quantities of shares were involved. I do not propose to set out in detail what their testimony was but only set out the following by way of summary:-

(a) the Deceased passed away on 23 October, 1981 leaving a Will dated 3 October, 1981 appointing the Plaintiffs and the 1st Defendant as executors;

(b) Probate of the Will was granted by the Hong Kong Court on 22 June, 1984 in Grant No. 2057 of 1984;

(c) the estate consisted of mainly credit balances in bank accounts, real properties and stocks and shares;

(d) in 1987, using some excuse, the 1st Defendant caused the Plaintiffs to sign some blank transfer forms. As a result, shares belonging to the estate were transferred out of the estate. The Plaintiffs were subsequently able to retrieve some of these shares but the others could no longer be found.

6. As at the date of the assessment, the following shares belonging to the estate remain unaccounted for:-

(a) 18,662 shares of China Light & Power Co. Ltd. ("CLP shares");

(b) 576,980 shares of Hong Kong Telecommunications Ltd. ("HKT shares");

(c) 162,388 shares of Hongkong Electric Holdings Ltd. ("HKE shares");

(d) 265,133 shares of HSBC Holdings Plc. ("HSBC shares")

( collectively "the missing shares").

A number of other shares are also unaccounted for. However, for various reasons given by the Plaintiffs, they made no claim for them. Though initially I had some concern over this, I consider that this is a matter for the Plaintiffs themselves, as co-executors, to decide. It would also be their responsibility to take care of any questions which the beneficiaries may raise as regards these shares.

7. Having considered Mr. Wong's testimony, I find that the market value of the missing shares as at 11 April, 1995 (the date of the Interlocutory Judgment) was:-

(a)	18,622 CLP shares	HK$	683,029
(b)	576,980 HKT shares		8,712,398
(c)	162,388 HKE shares		4,043,461
(d)	265,133 HSBC shares		23,530,554
	total		36,969,442
			==========

8. Further, the estate would have earned the following dividend income from the missing shares but for their loss:-

(a)	18,622 CLP shares	HK$	107,511
(b)	576,980 HKT shares		1,485,437
(c)	162,388 HKE shares		819,392
(d)	265,133 HSBC shares		4,126,268
	total		6,538,608
			=========

9. The total amount of damages which I assess to be recoverable by the Plaintiffs is therefore HK$43,508,050.

10. I accept Mr. Lo's proposal that interest should be at judgment rate from 11 April, 1995 to the date of this Judgment and thereafter at judgment rate until date of payment.

Similar to the costs awarded to the Plaintiffs by Mr. Justice Yam on 11 April, 1995, I consider that the costs of and incidental to the assessment should be paid by the 1st Defendant to the Plaintiffs to be taxed if not agreed on common fund basis and that the Plaintiffs' own costs of the assessment should be paid out of the estate on trustee basis.

(Andrew Chung)

Deputy Judge of The Court of the First Instance