YEUNG CHOK MING (楊作明), in his personal capacity and as the administrator of the Estate of Yeung Yau Yan (楊友人), deceased v. YEUNG CHOK LAM (楊作霖), in his personal capacity and as the administrator of the Estate of Chan Yu (陳如), deceased

HCMP 1131/2019

[2020] HKCFI 480

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1131 OF 2019

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J U D G M E N T

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Introduction

1.  The plaintiff, P, and the defendant, D, are two brothers.  Yeung Yau Yan was their father (“Father”) and Chan Yu was their mother (“Mother”). 

2.  P is the administrator of the estate of Father’s estate and D is the administrator of Mother’s estate.  In the originating summons, P seeks (i) the letters of administration of the Mother’s estate (“Mother’s LA”) registered in the Land Registry against a property be declared not registrable; (ii) the assent registered against the property (“Assent”) be declared not registrable and that that the Assent be declared null and void; and (iii) an order that both Mother’s LA and the Assent be vacated from the land register of the property at the Land Registry.

3.  D was absent at the 1^st hearing on 22 October 2019, and there had been no acknowledgment of service filed by D.  This Court then raised various queries in relation to service, in particular when there was no information as to why the address at which D was purportedly served was said to be D’s last known address.  The matter was then adjourned for P to file a further affirmation and for leave to P to inspect the probate files of both Father’s estate and Mother’s estate, to ascertain D’s address. 

4.  Subsequently, P’s solicitors arranged for personal service of the originating summons on D, and thereafter, D entered an acknowledgment of service on 29 October 2019 indicating that he does not intend to contest the proceedings.

5.  As P’s originating summons seeks declaratory reliefs, P’s solicitors was invited to make further submissions on the law and that the matter be dealt with on paper.

Background

6.  The property concerned is situate on the 3^rd floor, No 61, Wing Lok Street Hong Kong (“Property”).

7.  Father purchased the Property on 30 March 1976 in his sole name.  Father died intestate on 14 August 1994, leaving Mother as his surviving widow and two children, namely P and D. 

8.  The letters of administration of Father’s estate was upon Mother’s application granted to her on 3 February 1995 (“Father’s 1995 LA”).  This was duly registered in the Land Registry against the Property on 16 February 1995.

9.  Apart from registering Father’s 1995 LA and herself as administratrix of Father’s estate, Mother did not register any assent to vest the Property.  There was no evidence that she ever executed any assent.  In P’s 1^st affirmation, he stated that the Property was never administered by Mother.  There was no evidence to contradict what was said by P.

10.  Mother then passed away intestate on 27 April 2002.  Letters of administration of Mother’s estate, ie Mother’s LA, was granted to D on 23 June 2006.  Mother’s LA was registered against the Property on 6 July 2006.  On 9 October 2006, D, as administrator of Mother’s estate, then registered the Assent (which was dated 9 October 2006) on 12 October 2006 against the Property, to the effect that P and D held/holds the Property as tenants-in-common.

11.  The Assent was prepared by a firm of solicitors Messrs Wilson Yeung & Co and was signed by D as administrator of Mother’s estate, and P and D had both signed as “assignees”[1].

12.  According to P, he subsequently received advice that the registration of Mother’s LA and the Assent against the Property was, amongst other things, contrary to section 2(1) of the Land Registration Ordinance, Cap 128 (“LRO”), as both of the said documents did not affect the Property[2].

13.  It was under the above circumstances that P was then advised to apply for the letters of administration de bonis non of Father’s estate and to issue the present originating summons.

14.  The letters of administration de bonis non was granted to P on 30 January 2019.  The originating summons herein was issued on 2 August 2019.

Whether Mother’s LA conferred any power upon D to execute the Assent and/or deal with the Property

15.  Mr Kong, on behalf of P, has referred the Court to paragraph [425.610] of Halsbury Laws of Hong Kong, namely, “upon the death of a sole or sole surviving administrator appointed upon an intestacy, the chain of representation does not apply and the administration must be continued by the appointment of an administrator de bonis non”. 

16.  Further, as pointed out by Mr Kong, in Re Kwan Chung [2013] 6 HKC 29, Poon J, as he then was, has said that “Unless there is a chain of executorship, a further or a new grant, commonly known as grant de bonis non, is required to appoint a personal representative in respect of the unadministered estate”[3].

17.  Also, section 34 of the Probate and Administration Ordinance (“PAO”) states as follows:

“34. Executor of executor represents original testator

(1) An executor of a sole or last surviving executor of a testator is the executor of that testator…

(3) So long as the chain of such representation is unbroken, the last executor in the chain is the executor of every preceding testator.

(4) The chain of such representation is broken by—

(a) an intestacy; or…”

18.  Having considered the above, I am satisfied that upon the death of Mother, there was no longer an administrator to Father’s estate until the letters of administration de bonis non was granted to P.

19.  Section 66 (1) of the PAO provides that :

“A personal representative may assent to the vesting in any person who (whether by devise, bequest, devolution, appropriation or otherwise) may be entitled thereto, either beneficially or as a trustee or personal representative, of any immovable property to which the testator or intestate was entitled or over which he exercised a general power of appointment by his will and which devolved upon the personal representative.”

20.  Under section 2 of the PAO, “personal representative” means “the executor, original or by representation, or administrator for the time being of a deceased person”, and “administrator” means “a person to whom administration is granted”.

21.  I accept that only the administrator to Father’s estate would be able to assent to the vesting in a person who was entitled to the Property as set out and provided in section 66(1).  As letters of administration of Father’s estate had not been granted to D at the time when the Assent was executed, D did not have the capacity to execute the Assent in respect of the Property.  The Assent concerned two properties, and as Mother was the legal and beneficial owner of the other property, the Assent was null and void and of no effect only in relation to the Property.

Whether Mother’s LA and Assent were registrable

22.  Mr Kong submitted that Mother’s LA and Assent were not registrable against the Property under section 2(1) of the LRO.

23.  Section 2(1) of the LRO provides as follows:

“The Land Registry shall be a public office for the registration of deeds, conveyances, and other instruments in writing, and judgments; and all deeds, conveyances, and other instruments in writing, and all judgments, by which deeds, conveyances, and other instruments in writing, and judgments, any parcels of ground, tenements, or premises in Hong Kong may be affected, may be entered and registered in the said office in the prescribed manner.”

24.  The issue is whether the Property may be affected by Mother’s LA and the Assent.

25.  Mr Kong referred the Court to Re Yasaki International Co Ltd [1993] 1 HKC 349. In this case it was held that an assignment of the proceeds of sale of land did not create an interest affecting land for the purposes of the LRO and therefore not registrable, and that the party who registered the assignment did not take an equitable interest in the property itself or an interest which affected an interest in the property by virtue of the assignment.

26.  As pointed out by Godfrey J in the above case, the subject matter of the assignment stated “All moneys representing proceeds of sale received or to be received by the assignor from purchasers”, and thus the assignment did not purport to affect the assignor’s interest in the land itself.

27.  The Court was also referred to Thian’s Plastics Industrial Co Ltd and others and Tin’s Chemical Industrial Co Ltd and another [1971] HKLR 249 (Full Court).  The Thian’s case concerned the registration of a lis pendens[4] of the concerned property and the lis was a claim for remedies including that the plaintiffs be declared the beneficial owners of the property and other injunctive relief restraining the defendants from selling or otherwise dealing with the property.

28.  As said by Briggs J, as he then was,

“The expression “affects” is not a term of art. It can have a very wide meaning. In one sense any judgment given against a person who owns land may affect land. For the successful litigant may only be able to recover any damages awarded to him by the sale of such land. However, it has not been suggested that any proposed action can be registered as a lis pendens simply because the intended defendant owns landed property. Various authorities were quoted from other branches of the law in an effect to arrive at a more exact definition of the word “affects” but I did not derive any help therefrom[5].”

29.  Briggs J then considered the effect of the remedies claimed in the lis.  He had said the Court was dealing with a lis, namely a dispute but there was no dispute as to the ownership of the properties, which were held in the name of the 2^nd plaintiff and that the remedies sought referred to a dispute within the 1^st defendant company and/or restraining the 2^nd defendant not to exercise any of his powers as Managing Director of both the 1^st and 2^nd plaintiffs, which did not affect land.  He then held that none of the remedies claimed affected the ownership of the land, and there was no claim to any land or to any interest in land, nor was there a claim to charge some specific property.

30.  Huggins J , as he then was, had also said that the word “affect” can, and does, have a “a large meaning”[6].

31.  The present case does not concern registration of a lis pendens However, what is clear from the Thian’s case is that the words “affect” or “may be affected” have a very wide or large meaning.

32.  In the Schedule of Property annexed to Mother’s LA, it was stated :

“Property held by the deceased as trustee only:

The deceased held the following assets as trustee in respect of the estate of [Father] deceased: -

[address of the Property] $500,000*

  *Value per Affidavit; for estate duty purposes only”

33.  Under section 4(3) of the Intestates’ Estate Ordinance, Cap 73 (“IEO”),  if an intestate leaves a husband or wife and issue, the surviving spouse takes the personal chattels absolutely and in addition, the residuary estate of the intestate (other than personal chattels ) is stand charged with the payment of a net sum of $500,000 , free of death duties (if any) and interests as set out in that section, and subject to providing for that sum and interest, the residuary estate (other than the personal chattels) shall be held as to one half, in trust for the surviving spouse absolutely.

34.  Father died on 14 August 1994, which was prior to the current section 4(3) was brought in, and there was no information before this Court as to what the then net sum charged was, but there should still be a net sum charged (“Charged Sum”).

35.  The Charged Sum was against Father’s residuary estate.  The beneficial interest Mother had was to one half of Father’s residuary estate, which had not been vested during her lifetime and Father’s estate had not yet been fully administered. However, as seen in Father’s 1995 LA registered in the Land Registry, the only asset that Father had at the time of his death was the Property.

36.  Thus, although Mother does not automatically have a direct beneficial interest in the Property by virtue of Father’s death and the provisions of the IEO, as there was no other evidence there were any other assets, it may be arguable that Mother may have an indirect interest in the Property, and/or the Property, being the only asset of Father’s estate, is charged with the Charged Sum.

37.  In his supplemental submissions, Mr Kong had referred the Court to the House of Lords case of Lord Sudeley and Others and The Attroney-General [1897] AC 11 (HL).  The wife of the testator was by his codicil given one-fourth of the testator’s residuary real and personal estate absolutely.  The wife later died and at the time of her death, only one legacy given by the testator’s will then remained unpaid and although the amount of the clear residue had not been ascertained, it had been ascertained that there would be a large residue over and above the debts and legacies.

38.  As Lord Halsbury LC had said, “… it was fallacious of Mr Channell [on behalf of appellants] to say that the residue was very nearly ascertained, because the question is not only of amount – although I think that of itself would not be sufficient if it were only of amount-but it is a question of substance as well as a question of amount.  It is uncertain until the residuary estate has been ascertained of what it will consist.  It may consist of many things – it may consist of only a sum of money – and until that has been ascertained the actual right capable of instant assertion does not exist…”[7].

39.  In  Commissioner of Stamp Duties (Queensland) and Hugh Duncan Livingston [1965] AC 694 (HL), it was also held by the Privy Council, amongst other things, that in the case of an unadministered estate,  the assets as a whole were in the hands of the executor, his property, and until administration was complete it could not be said of what the residue, when ascertained, would consist or what its value would be, and that in the case, at the date of the widow’ death, therefore, there was no trust fund consisting of the testator’s residuary estate in which she could be said to have any beneficial interest because no trust had as yet come into existence to affect the assets of his estate.  It was further held that the law in the Lord Sudeley case was “conclusive on this issue”.

40.  Having considered the above, and even though the Property appeared to be the only asset of the Father’s estate, without full administration of Father’s estate, the residuary estate could not be ascertained.  I accept Mr Kong’s submissions Mother had acquired only a right to have Father’s estate duly administered, and that Mother’s LA would not express or imply a beneficial interest in the Property.

41.  In the above circumstances, although the words “affect” or “may be affected” have a very wide or large meaning, I have come to the view that Mother’s LA was not registrable. 

42.  As for the Assent, as I have found earlier, it was null and void and of no effect, it was not registrable. 

Inherent jurisdiction for vacation of land registration 

43.  Having considered the authorities, I am satisfied that this Court can vacate the registration of Mother’s LA and the Assent against the Property at the Land Registry.

Order

44.  In light of what was said above, I am prepared to make an order in terms of paragraphs 1 and 2 of the Originating Summons.

45.  As for costs, the registration of Mother’s LA and the Assent was in the course of D’s purported administration of Mother’s estate.  D had obtained legal advice at the time and the Assent was prepared by solicitors and was signed and accepted by P himself at the time.  In my view, it would appear that erroneous advice had been given to D at the time. However, I accept P was not at fault, and in issuing the present proceedings, he is only seeking to put things right.  I accept Mr Kong’s submissions that P’s costs should be borne by Mother’s estate. 

46.  P has submitted a statement of costs of a total of HK$122,245 for summary assessment.  The 1^st hearing was adjourned on the issue of service raised by the Court and both hearings were only about 20 minutes each, I am of the view that costs in the statement were on the high side.

47.  Costs are summarily assessed and allowed HK$85,000, to be paid by Mother’s estate within 28 days.