TANG KA HUNG ROBERT AND ANOTHER v. TANG TIM CHUE alias TANG TIM CHU

HCAP 7/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PROBATE ACTION NO. 7 OF 2006

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REASONS FOR DECISION

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1.  The plaintiffs are the executors named in the last will dated 27 September 1991 made by their late father, Mr Tang Sum On. Mr Tang died on 7 November 2005 in Hong Kong.

2.  The defendant is the son of Mr Tang and the half brother of the plaintiffs.  On 18 November 2005 and 26 January 2006, the defendant entered a Caveat and an Appearance to Warning in HCCA002730/2005 to oppose to the will to be admitted to probate. 

3.  In March 2006, the plaintiffs commenced this probate action to have the Caveat withdrawn and for probate to be granted to them. In June 2006, the defendant filed a Defence and Counterclaim raising a number of issues concerning the assets to be comprised in the estate and how the estate should be distributed.

4.  The defendant was privately represented until legal aid was granted to him. The Legal Aid Certificate was issued on 29 August 2006 and counsel was later assigned by the Director of Legal Aid.

5.  By summons filed on 28 February 2007, the plaintiffs apply to strike out the Defence and Counterclaim on the basis that none of the matters raised in it affects the validity of the will or the plaintiffs’ entitlement to probate and also on the basis that they are devoid of merits. The summons was set down for argument on 19 September 2007. 

6.  Shortly before the hearing, the defendant’s solicitors indicated to the plaintiffs’ solicitors and the court that the striking out application would not be opposed. The arguments at the hearing were directed at the question of costs.  Apart from asking that the costs of the caveat proceedings and this probate action be paid by the defendant, the plaintiffs further applied for an order under section 17(3) of the Legal Aid Ordinance, cap.91 (“LAO”) that the costs incurred by the plaintiffs after the grant of Legal Aid Certificate be paid by the defendant personally. The application was opposed by the defendant.  After hearing arguments, I refused to make an order under section 17(3) of LAO and gave oral reasons for the decision. I now reduce the reasons into writing.

7.  On the question of entitlement to costs, there is no reason to depart from the normal rule of costs follow event so that the costs of the caveat proceedings and this probate action should be to the plaintiff against the defendant to be taxed if not agreed. 

8.  The plaintiff’s application for an order under section 17(3) of the LAO will impact on the defendant's personal liability for costs incurred after the Legal Aid Certificate was issued. This is because in the normal course, the plaintiffs' ability to recover costs or to enforce the costs order that I had made will be subject to section 16C of the LAO.  The relevant part of section 16C provides as follows:

“	(1)	Subject to section 18A, the liability of an aided person and of the Director for costs shall be determined in the following manner-
		(a)	…
		(b)	where a court … makes an order for costs against an aided person, … , in favour of a person not receiving legal aid-
			(i)	…
				(ia)	in any case in which the party not receiving legal aid is a defendant to a counterclaim … , the costs occasioned by the counterclaim, … filed by or on behalf of the aided person shall be paid by the Director;
				(ib)	…
			(ii)	in any other case, neither the Director nor the aided person shall be liable for such costs unless a contribution is payable by the aided person under section 18(1)(b); in which case the Director on behalf of the aided person shall pay such costs to the extent that the contribution is in excess of the costs incurred by the Director on behalf of the aided person; and
		(c)	…
	(2)	Subsection (1),in so far as it relates to the costs of an aided person, relates only to costs arising in respect of proceedings to which, and during the period to which, a legal aid certificate relates, and nothing in that subsection shall otherwise affect the liability for costs of an aided person.”

9.  The effects of section 16(C) insofar as they are relevant to this action are that: (1) The defendant will be personally liable for the plaintiff’s costs in the Caveat proceedings and this probate action incurred prior to the grant of the Legal Aid Certificate: section 16C(2); and (2) The Director of Legal Aid will be responsible for the plaintiff’s costs occasioned by the Counterclaim: section 16C(1)(b)(ia).  It follows that under section 16C, the plaintiffs cannot recover from either the Director or the defendant the costs of their claim in this probate action incurred after the issue of the Legal Aid Certificate.

10.  The significance of all these in the context of the present case is that: (1) As Mr Ho SC rightly pointed out, this is a probate action in which the plaintiffs are compelled to litigate in order to clear the Caveat so as to obtain the grant of probate; and (2) Any costs of the plaintiffs which are unmet will have to be met by the estate given that the plaintiffs are acting in their capacity as executors.  It is against this background that the plaintiffs made the application under section 17(3) of LAO.

11.  Section 17(3) provides:

“

Where it appears to a court or judge that an aided person has acted improperly in bringing or defending any legal proceedings or in the conduct of them, the court or judge may order the aided person to pay the costs of the Director and of the counsel or solicitor who acted for him or the costs of the other party, or the costs of the Director and such counsel and solicitor and such party.”

12.  In my view, the important words in the section are "an aided person has acted improperly in bringing or defending any legal proceedings or, in the conduct of".  On Mr Ho SC’s analysis of the facts surrounding this action and also the development leading to the defendant's eventual concession to this striking out application, I accept that there is an abuse of Caveat proceedings and also of the probate proceedings.  Specifically, the Defence and Counterclaim raises no probate issues and has no relevance to whether the plaintiffs are entitled to be granted probate.  Further, the claim that the properties that had been transferred to the deceased under the Order in HCA No. 2125 of 1978 remained properties of the Tso is clearly untenable in light of the plain wordings of the Order and the transfer that was effected in pursuance of the Order. In the absence of explanations, the abuse is prima facie attributed to the defendant.

13.  Mr Tang, however, informs the court that the decision to defend this action and to file the Defence and Counterclaim was as a result of advice he had received from his then counsel. However, after the counsel assigned by Director of Legal Aid had considered Mr Ho’s submissions on the striking out application and given the advice not to contest the application, the defendant readily accepted it and agreed not to contest the application as well as these proceedings. 

14.  I acknowledge that the appropriate and better course is for these explanations to be given by way of affidavit evidence.  That said, however, I have no reason to doubt or not to accept what Mr Tang relates to the court.  The upshot of all these is that the defendant was throughout acting on legal advice and that it was because of the different advice he received from different counsel that he had changed from defending the claim to conceding the striking-out application and the claim.

15.  Section 17(3) of LAO is an exception to the general position governing an aided person's personal liability to costs, which is provided under section 16C.  I do not believe that the spirit of section 17(3) is to expose an aided person to costs liability as a result of inapt advice given by his legal representatives.  In this regard, I note in particular that section 17(3) not only deals with liability for costs of the aided person’s opponent, but also extends to liability for costs of the Director as well as costs of the aided person's own counsel and solicitors. 

16.  In the circumstances of this case, given what Mr Tang has informed the court, I do not feel that the discretion of the court should be exercised in making an order under section 17(3).  Accordingly, I will not order the defendant to pay the plaintiff’s costs of the claim incurred after the issue of the Legal Aid Certificate.

17.  Upon the plaintiffs’ application, there is a certificate for two counsel. This is because I note from the judgment of Chung J in HCA No. 3 of 2006 [2006] 2 HKC 582 that both Mr Ho SC and Mr Hung have been involved in the dispute right from an early stage. Further, the issues involved in the striking out application, especially on costs and section 17C of LAO, are less than straightforward. Counsel’s arguments have greatly assisted the court.

18.  In summary, the orders that I make are as follows:

(1)	The Defence and Counterclaim be struck out.
(2)	The counter-claim be dismissed.
(3)	Judgment be entered for the plaintiff against the defendant for-
	(a)	An order that the Caveat and the Appearance to Warning entered by the defendant in HCCA 002730/2005 be withdrawn.
	(b)	An order that the grant of probate of the estate of Tang Sum On, deceased, be granted to the plaintiffs if entitled thereto; and
	(c)	The costs of the caveat proceedings in HCCA002730/2005, to be taxed if not agreed, together with a certificate for two counsel.
(4)	The defendant’s own costs be taxed under the Legal Aid Regulations.