RE YLC

HCMP 1190/2005

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1190 OF 2005

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BETWEEN

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R E A S O N S   F O R   D E C I S I O N

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1.  On 16 September 2005, having held an inquiry and being satisfied that Madam YLC is incapable by reason of mental incapacity of managing and administering her property and affairs, this court has to consider what is the appropriate order to make under Part II of the Mental Health Ordinance regarding the estate of YLC.

2.  YLC is a spinster of 82.  She had a stroke in 2004 which led to her mental incapacity.  She is now living at an institution for the elderly.  A private nurse is taking care of her.  She used to live with her brother who sadly passed away in January 2005.  She had another brother in Canada.  The applicant is the son of that brother.  He sought to have himself appointed as committee for the estate of YLC.  He had been paying for the maintenance of YLC since January 2005.  However, as he is residing outside jurisdiction, this court had reservations about such an option.  The court explored the option of appointing the Official Solicitor as the committee.  The applicant objected to such a course.  The Official Solicitor filed a report on 30 August 2005.

3.  In the end, having regard to the financial needs of YLC, the nature of her assets and the management of the same, the present conditions of YLC and existing arrangement for her care, her age, the wishes of the applicant, this court decided that it is not necessary to appoint a committee.  Instead, it would be expedient to make an order under Section 24 of the Mental Health Ordinance for the monthly payments out of the estate of YLC for her maintenance.  The liquid assets of YLC that had been paid into court add up to about $3.3 million.  An interim order was made on 8 November 2005 for monthly payment out to the applicant in the sum of $60,000 for the maintenance of YLC. 

4.  The applicant also sought reimbursement of expenses he had previously paid for the maintenance of YLC.  However, as he had not produced all the evidence for such expenses, that matter was adjourned.

5.  The applicant filed a Third Affirmation on 12 October 2005 setting out the evidence for past expenses.  The total figures from January to September 2005 run up to $529,278.84.  Having read the affirmation and its exhibits, the court had some queries about the traveling expenses claimed by the applicant.  The traveling expenses added up to $169,609.34, representing more than 30% of the total.  These included a trip in August from Toronto to Hong Kong via Vienna and London.  The court queried whether these trips were solely for the affairs of YLC.  Submissions were invited from the applicant and the Official Solicitor as the explanation for the same have a bearing on the court’s determination as regards whether the applicant is the appropriate person to be appointed as payee under Section 24.

6.  An applicant making applications under Part II of the Mental Health Ordinance and those advising him and the relatives of a mentally incapacitated person should appreciate the nature of these proceedings and the role of the court.  I have previously discussed these topics in the following cases,

(a) Re S, HCMP 1287 of 2004, 28 May 2004;

(b) Re Madam L, HCMP 2042 of 2004, 20 October 2004;

(c) Re CS, HCMP 230 of 2005, 13 May 2005;

(d) Re LWO, HCMP 2965 of 2001, 30 June 2005;

(e) Re LYO, HCMP 961 of 2004, 15 July 2005;

(f) Re M, HCMP 25 of 2005, 1 November 2005. 

7.  For the benefit of the Applicant, I reiterate that in hearing a Part II application, the court is exercising its protective jurisdiction in respect of the property and affairs of a mentally incapacitated person.  In such an application, the court is guided by Section 10A of the Ordinance.  The paramount consideration is the requirements of the mentally incapacitated person.  Although the court will in most cases take into account the views and wishes of the relatives, the court will exercise an independent judgment as to what is the most appropriate arrangement in the circumstances of the case.  A relative does not have any right to insist upon being appointed as the committee or as payee for the purpose of Section 24.  The court has to ask whether this person is, objectively speaking, the most appropriate person to be entrusted with the task of dealing with the assets of the mentally incapacitated person, see Re S, HCMP 1287 of 2004, 28 May 2004, Para. 6.  When the court has doubts in that regard, it is duty bound to raise queries.

8.  Unfortunately, the applicant took offence from the queries raised by the court.  In a letter dated 19 October 2005, he criticized the approach of the court as “red-tape” and an abuse of power.  He also said the following by way of explanation,

“Yes, I was in London and Vienna, en route to HK.  This was my planned annual holiday that I badly needed after trying to conduct business on 2 continents and simultaneously handling all the red-tape entangling my aunt’s affairs.  In fact, my holiday plans had to be changed considerably, due to the fact I was summoned back to Hong Kong by the doctors from the hospital who told me that my aunt had only hours to live.  … It was never my intention to try and reclaim the costs of my holiday transportation, just to be reimbursed for the cost of my unavoidable detour to Hong Kong. …”

That letter was forwarded to the court by the applicant’s solicitors.

9.  In so saying, the applicant failed to have regard to what had been set out in his Third Affirmation.  There was no explanation whatsoever in that affirmation why he could not travel directly from Toronto to Hong Kong if the trip was for the sole purpose of dealing with the affairs of YLC.  He also forgot that in his Third Affirmation, he claimed reimbursement for the whole trip, not only for the “unavoidable detour to Hong Kong”.  Further, the receipt produced by him to support this item is an invoice dated 19 July 2005 for departure on 5 August 2005.  The applicant owed the court an explanation how that fit into his alleged sudden change of holiday schedule due to urgent summon from the doctors in Hong Kong.  

10.  On 31 October 2005, the solicitors for the applicant wrote to the court to put forward the applicant’s submissions.  Enclosed in that letter is a handwritten Chinese statement from the private nurse who has been taking care of YLC supporting the applicant’s appointment.

11.  I must point out that the manner in which the solicitor handled this matter is wholly irregular.  Every lawyer should know the proper procedure for placing evidence before the court.  If what the applicant said in his letter of 19 October 2005 was intended to be his evidence about the purposes of the August trip, he should depose to the same in an affirmation.  It is not acceptable to forward a letter from one’s client to the court.  If the applicant wishes this court to consider the statement of the private nurse, the proper course is to file an affirmation deposed by the nurse.  It is again not acceptable for the solicitor to enclose in his letter a Chinese statement of the private nurse.

12.  In the letter of 31 October 2005, the solicitor said the following with regard to the August trip,

“The trip was intended as visit to [YLC] with a private holiday en route.  But the holiday was abruptly cancelled and the itinerary changed when [the applicant] was summoned back to Hong Kong by the doctor … The doctor believed [YLC] was in critical condition and had only hours to live.  [The applicant’s] presence in Hong Kong was urgently requested.  As such the trip was no longer a holiday trip.  We would like to suggest that at least 50% of the traveling expenses for this Hong Kong trip be reimbursed.”

13.  The applicant was not present at the hearing of 9 December 2005.  His counsel accepted that the court was justified in raising the queries and he agreed to file a further affirmation by the applicant to clear the doubts in the mind of the court.

14.  Counsel for the applicant wrote a letter to the applicant on 22 December 2005 setting out the role of the court in this sort of applications.  A further affirmation of the applicant was filed on 5 January 2006 giving further explanation about the August trip.  It would appear from what he said in the latest affirmation that he was in the course of his holiday when he flew to Hong Kong urgently on 16 August.  Although he had planned to come to Hong Kong in any event, his holiday had been cut short. 

15.  At the hearing on 16 January 2006, taking into account of the fact that part of the August trip was a holiday, counsel for the applicant agreed to reduce the claim for reimbursement to $500,000.

16.  The Official Solicitor raised query about the use of YLC’s money for the maintenance and upkeep of the flat at MacDonnell Road.  As mentioned above, YLC is now staying at an institution and the flat is not her property.  There is no good reason why she has to pay for such maintenance and upkeep.  On 16 January 2006, counsel for the applicant agreed that the maintenance and upkeep should be paid by the estate of the owner of the flat.  Hence, the monthly sum payable to the applicant for the maintenance of YLC could be reduced to $40,000.

17.  There is also a concern in respect of the contention of the solicitor in the letter of 31 October 2005 that it was impractical to ensure all payments out of the money of YLC were for her own maintenance.  That is a very startling submission to be made by a solicitor acting for someone who seeks to be appointed by the court to handle the monies of an incapacitated person.  The applicant has a duty to make sure that the monies of YLC were spent on her own maintenance and nothing else.  If he cannot perform such a duty, he should not seek to be appointed.

18.  I mention all these not with a view to criticize anyone.  Rather I hope to bring a clear message to the applicant (as well as those advising the applicant and other in similar position as the applicant) that a payee under Section 24 owes fiduciary duties towards the patient and the court will see to it that such duties are honoured.

19.  With the benefit of advice from his counsel and this Reason for Decision, the applicant should have no misunderstanding as to what is expected of him in acting as payee under Section 24.  He is also reminded to file account every six months.       

20.  Considering all matters in the round, despite my misgivings regarding the past, I would give it a try and appoint the applicant as payee for the purpose of Section 24.  The monthly sum would be, as suggested by counsel, reduced to $40,000.  I also authorized reimbursement to the applicant for past expenses in the sum of $500,000.

21.  Regarding costs of the proceedings, I ordered costs up to the hearing of 16 September be paid out of the estate of YLC.  However, the costs of the subsequent hearings could have been avoided had the applicant and those advising him be more forthcoming in respect of the account for certain expenses.  The initial responses by the applicant and his solicitors towards the queries raised by the court demonstrated a serious misapprehension as to the role of the court and a payee under Section 24.  I see no reason why the estate of YLC should be saddled with the costs relating thereto.  I therefore ordered the applicant to pay for the costs of the Official Solicitor for the hearings in December and January.  He also has to pay his own costs incurred after 16 September.

22.  I intend to release the Reasons for Decision for publication.  If any party has any comment about such course, he can write to this court within 7 days.