Verralls, Amy v. Maria Gina La Giglia also known as La Giglia Maria Gina

HCAP 15/2014 and
HCA 2229/2014
(Heard Together)
[2018] HKCFI 2386

HCAP 15/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

PROBATE ACTION NO 15 OF 2014

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AND

HCA 2229/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2229 OF 2014

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(Heard Together)

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D E C I S I O N

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THE APPLICATIONS

1.There are two applications before me.  They are applications for security for costs by the defendant against the plaintiff in both sets of proceedings, namely, HCAP 15/2014 (“the Probate Action”) and HCA 2229/2014 (“HCA 2229”).  The two applications were ordered by Master Thomas Leung on 6 June 2018 to be heard together by a Judge.

2.On 29 May 2018, the defendant issued a Summons in each of the two sets of proceedings under Order 23, rule 1 of the Rules of the High Court (“RHC”):

(i)   in the Probate Action, seeking security for costs in the sum of $1,212,650 to cover the period up to and including the mutual exchange of witness statements and expert reports; and

(ii)   In HCA 2229, seeking security for costs in the sum of $939,985to cover the period up to and including the mutual exchange of witness statements.

3.The specific ground relied upon by the defendant in each of thetwo applications is based on Order 23, rule 1(1)(c) which provides as follows:

“ 1. Security for costs of action, etc. (O. 23, r. 1)

(1) Where, on the application of a defendant to an action or otherproceeding in the Court or First Instance, it appears to the Court–

…

(c) subject to paragraph (2), that the plaintiff’s address is not stated in the writ or other originating process or is incorrectly stated therein, …

…

then if, having regard to all the circumstances of the case, the Court thinks it just to do so, it may order the plaintiff to give such security for the defendant’s costs of the action or other proceeding as it thinks just.”

For the sake of completeness, I should point out that paragraph (2) of Order 23, rule 1 provides as follows:

“ (2) The Court shall not require a plaintiff to give security by reason only of paragraph (1)(c) if he satisfies the Court that the failure to state his address or the mis-statement thereof was made innocently and without intention to deceive.”

THE RELEVANT HISTORY OF THE PROCEEDINGS

4.On 20 May 2014, the plaintiff issued the Writ of Summons in the Probate Action.  Her address was and is stated on the Writ as “Flat F (inclusive of Balcony held therewith) on 12^th Floor of Tower 1, ‘8 Waterloo Road’, No. 8 Waterloo Road, Kowloon, Hong Kong” (“the Property”).

5.After the issue of the Writ, the plaintiff filed various versions of the original Statement of Claim.  She eventually filed the Re-Amended Statement of Claim (“the Re-Amended S/C”) on 8 April 2015.  In it, she pleads that she was and is the sole executrix appointed under the Will of James La Giglia deceased (“the Deceased”) dated 12 March 2013 (“the March Will”).  The Deceased died on 3 September 2013 at the age of 50.  She also alleges that she had been the girl friend of the Deceased since around 2005.  Later on, the Deceased cohabited with the plaintiff together with her adopted daughter Jessica, aged 9, at the Property and adopted a paternal role over Jessica. She then claims that another Will by the Deceased dated 14 August 2013 (“the August Will”) in respect of which the High Court issued a Grant of Probate to the defendant as executrix on 21 March 2014 (“the Grant of Probate”) was purportedly executed by the Deceased when he had no mental testamentary capacity.  She further alleges that the August Will is a forgery.

6.In a later section of the Re-Amended S/C, the plaintiff relies on “the doctrine of donation mortis causa” and pleads that the Deceased had in contemplation of death made a gift of all his property to her.  This will be dealt with in greater detail below.

7.On the aforesaid basis, she claims against the defendant, inter alia, the following relief:

(i)   revocation of the Grant of Probate;

(ii)   pronouncement by the Court against the validity of the August Will;

(iii)   a grant of probate of the March Will to her in solemn form;

(iv)   “Further or in the alternative, a declaration that all of the properties in the Deceased estate including all shares, monies in specie and chose in action or in all bank accounts held by the Deceased prior to his death; the 2^nd properties are gift given to the Plaintiff by the Deceased under the doctrine of Donatio Mortise Causa.”;

(v)   “An Order for the Defendant to effect transfer and/or conveyance of all the properties referred to in the preceding paragraph to the Plaintiff.”

It is not clear, under (iv) above, what the plaintiff is referring to by the use of the expression “the 2^nd properties”.

8.The defendant filed her Defence on 6 May 2015.

9.The plaintiff filed her Reply on 20 August 2015.

10.After that, nothing seemed to have happened in the Probate Action until 29 May 2018 when the defendant issued the present Summons for security for costs.

11.On 4 November 2014, the plaintiff issued the Writ of Summons in HCA 2229 with the Statement of Claim endorsed thereon (“the S/C”) against the defendant.  This action is specifically regarding the Property.  In the Writ of Summons, the address of the plaintiff was and is again stated as the Property.

12.In the S/C, the plaintiff alleges that the Deceased started courtingher in about March 2005 and thereafter they started an intimate relationship. Shortly thereafter, the plaintiff adopted Jessica and the Deceased became her de facto parent.  In May 2011, the Deceased purchased the Property.  In about June 2011, the Deceased and the plaintiff started cohabiting in the Property together with Jessica.

13.In paragraph 3 of the S/C, the plaintiff further pleads, inter alia, as follows:

“ (g) On numerous occasions, the Deceased represented to the Plaintiff and their adopted daughter that he would give the Plaintiff and their adopted daughter all his money and properties if three conditions were satisfied, they are namely that:

(i) their adopted daughter finishes the best university;

(ii) she does not take drugs; and

(iii) she has to be a good person.

(h) The Deceased had on numerous occasions proposed to the Plaintiff for marriage during their cohabitation.

(i) The Plaintiff purchased and paid for all of the furnishing of thesaid Property including but not limited to sofa couches, dining table set, television set, electric fans, toaster, rice cooker.

(j) Further, the Plaintiff had been paying the utilities expenses such as the electricity bills, telephone bills and all other outgoing expenses for the maintenance and repairs of the said Property throughout the cohabitation.”

14.The plaintiff goes on to plead that in or around February 2013, the Deceased was diagnosed with carcinogenic brain tumors.  On 12 March 2013, the Deceased executed the March Will making the plaintiff his sole executrix and giving the whole of his estate to her.  She described the circumstances on that day in paragraph 5 of the S/C as follows:

“ PARTICULARS

(a) In or about February 2013, the Deceased started to show symptoms of illness and was diagnosed with four malignant carcinogenic brain tumors, one of which was as large as 5.4 centimeters and that they were at terminal stage and incurable. It was further opined by his doctor that he was only expected to live for a few more months.

(b) Soon as the Deceased learnt of this devastating news, he proposed to the plaintiff for marriage and wedding pictures were taken at the France Bridal Wedding Salon in Hong Kong.

(c) Before the shooting of the wedding photographs, upon the request of the Deceased, the Plaintiff took the Deceased out ofthe Queen Elizabeth Hospital for a few hours to attend the bank for his private matters and to attend a solicitor’s firm, namely Messrs. Anthony Kwan & Co. to execute the true last will and to have a meal with him to discuss the plan of their wedding.

(d) The Plaintiff and the Deceased attended the office of Messrs.Anthony Kwan & Co on 12^thMarch 2013 where the Deceased executed the true last will witnessed by the solicitor and clerk of Messrs. Anthony Kwan & Co.

(e) The Deceased also represented to the Plaintiff that he wanted to spend the rest of his life with the Plaintiff and their adopteddaughter until he died and he liked Hong Kong and did not like Chicago.

(f) The Deceased was transferred to St. Teresa Hospital and the Plaintiff paid about HK$211,346 for settling the hospital expenses and private nursing service fees incurred by the Deceased during his stay there.

(g) In fear of the lack of financial resources of the Plaintiff to settle the hospital expenses and repay the mortgage loan of the said Property after his death, the Deceased asked the Plaintiff to open a joint named bank account and they would deposit money into the account in or around April 2013 for settling the hospital expenses and making the mortgage loan repayment for the said Property.

(h) On 5th June 2013, the Plaintiff deposited HK$231,615 into theabovementioned joint named bank account for the Deceased’sexpenses and the mortgage loan repayment for the said Property.

(i) In the premises, the Deceased had full intention and did by his representations either express or implied or inferred by his conduct that he meant and did allow and acquiesce the Plaintiff and their adopted daughter to live at and/or co-own the said Property at all material times.  Further and in the circumstances, the Plaintiff acting upon the Deceased’s promises and representations, has expended time, money, energy and financial resources on the said Property.”

15.On the basis of the matters pleaded in the S/C as enumerated above, the plaintiff pleads the existence of a proprietary estoppel and a constructive trust in her favour as follows:

“ Proprietary Estoppel

8. By reason of the matters aforesaid, the Plaintiff is entitled to seek a declaration that the Defendant has been estopped and precluded from claiming proprietary right of the said Property. In the circumstances, the Defendant is precluded from doing so by reason of express and implied representations by the Deceased made to the Plaintiff, and also inferred by conduct of the Deceased, with the intention that the Plaintiff should act on the aforesaid representations and conduct, which the Plaintiff did in fact do.

Constructive Trust

9. Further or in the alternative, by reason of the matters aforesaid,the Plaintiff is entitled to and seeks an Order of declaration that there was a common intention between the Deceased and the Plaintiff to own the said Property as joint tenants. This common intention was crystallized prior to the acquisition of the said Property.  Consequent to the death of the Deceased, the Plaintiff enjoys the right of survivorship and she is thus entitled to ownership of the whole of the said Property.  Accordingly, the Defendant has no title, interest or share in the said Property.”

16.In the prayer in the S/C, the plaintiff claims, inter alia, the following relief:

“ (1) A declaration that the said Property was held on constructive trust for her by the Deceased;

(2) A declaration that the Plaintiff was a joint tenant in equity of the said Property;

(3) A declaration that the plaintiff is entitled to be the sole owner of the said Property on the principle of the right of survivorship;

(4) An order to compel the Defendant to effect the conveyance of ownership of the said Property to be vested in the Plaintiff’s name or an entity designated by her at her discretion

(5) Further or in the alternative to paragraph (4) above, an order to grant to the Plaintiff an irrevocable license to reside and exclusively live at and occupy the said Property;”

17.The defendant filed her Defence on 9 September 2015.

18.The plaintiff filed her Reply on 12 November 2015.

19.Again, nothing seemed to have happened in HCA 2229 until 29 May 2018 when the defendant issued the present Summons for security for costs.

20.The defendant and the plaintiff have filed affidavit/affirmation evidence in the two sets of proceedings in support of and in opposition to the applications for security for costs.

LEGAL PRINCIPLES

21.There is no dispute that, as at the dates of the issue of the Writs of Summons in both sets of proceedings, the plaintiff was actually not residing at the Property as her home.  The condition under sub-paragraph (c) in Order 23, rule 1(1) has therefore been satisfied and that rule has been triggered.  The question is whether the Court should exercise its discretion under Order 23, rule 1(1), after taking into account rule 1(2), and order security for costs to be provided by the plaintiff.

22.The applicable principles regarding security for costs are well summarised in the Judgment of Godfrey JA in the case of Wing Hing Provision, Wine & Spirits Trading Co Ltd v Hanjin Shipping Co Ltd [1998] 4 HKC 461 at 464A–F as follows:

“ 1. The court has a complete discretion whether to order security,and accordingly it will act in the light of all the relevant circumstances.

2. The possibility or probability that the plaintiff company will be deterred from pursuing its claim by an order for security isnot without more a sufficient reason for not ordering security.

3. The court must carry out a balancing exercise. On the one hand it must weigh the injustice to the plaintiff if prevented from pursuing a proper claim by an order for security. Against that, it must weigh the injustice to the defendant if no security is ordered and the defendant finds himself unable to recover costs from the plaintiff in due course.

4. In considering all the circumstances, the court will have regard to the plaintiff company’s prospects of success. But it should not go into the merits in detail unless it can clearly be demonstrated that there is a high degree of probability of success or failure.

5. The court may order any amount up to the full amount claimed by way of security, provided that it is more than a simply nominal sum; it is not bound to order a substantial amount.

6. Before refusing to order security on the ground that it would unfairly stifle a valid claim, the court must be satisfied that,in all the circumstances, it is probable that the claim would be stifled.  There may be cases where this can properly be inferred without direct evidence.  The court should consider not only whether the plaintiff company can provide security out of its own resources to continue the litigation, but also whether it can raise the amount needed from its directors,shareholders or other backers or interested parties.  It is for the plaintiff to satisfy the court that it would be prevented by an order for security from continuing the litigation.”

23.The same principles were again set out by DHCJ R Ismail SC in the case of Phoneworld LLC v Allied Rich Century Ltd (HCA 1178/2014, 20 November 2015) at paragraph 20.  At paragraph 21, the learned Deputy Judge also referred to the Judgment of Recorder Horace Wong SC in the case of Lim Yi Shenn v Wong Yuen Yee [2012] 3 HKLRD 505 at paragraphs 14 – 16, where Recorder Wong SC gave a warning against the danger in a court making a decision on the merits of a case on paper.

24.I have no intention of going into the merits of the present casesin detail on the basis of the pleadings and the evidence filed which naturally are controversial.  I therefore do not propose to make detailed findings of fact except where there is irrefutable or near-irrefutable documentary or otherevidence regarding some aspects of the cases.  Nevertheless, the Court willstill have to form a view on the strength or weakness of the parties’ respective cases based on the materials before it in order to carry out the necessary balancing exercise.

THE PARTIES’ RESPECTIVE CASES ON SECURITY FOR COSTS

25.The grounds relied on by the defendant can be summarised as follows:

(i)   The address of the plaintiff as stated in the Writ of Summons in each of the two actions is false and has never been amended despite the fact that the Statement of Claim in the Probate Action has been amended twice.

(ii)   On the evidence, the false statement of the plaintiff’s address on both Writs of Summons was not made innocently but was with intention to deceive. The plaintiff habitually did that in order to deceive her creditors or opponents in litigation or to evade the consequences of litigation.

(iii)   On the merits of the two cases, the defendant has a high probability of success in both.

(iv)   Hence, the Court should exercise its discretion in ordering security for costs to be provided by the plaintiff.

26.The grounds relied on by the plaintiff can be summarised as follows:

(i)   It is admitted that the plaintiff’s address was wrongly stated in the two Writs of Summons, but such mis-statement was made innocently and without intention to deceive.

(ii)   The plaintiff has got a strong case on the merits in both actions.

(iii)   The defendant has delayed in applying for security for costs.

(iv)   Hence, the Court should not order the plaintiff to give security for costs.

(v)   In any event, the amounts of security asked for by the defendant are excessive.

THE MIS-STATEMENT OF THE PLAINTIFF’S ADDRESS

27.The plaintiff filed her 4^th Affirmation in the Probate Action on 26 July 2018.  In paragraph 36 thereof she said that one day in June 2013, the defendant and a man called Chris suddenly changed the lock of the Property and therefore she was unable to enter the Property any more.  She did not even have time to collect her clothes and her belongings inside the Property.  She however honestly believed that she could return to the Property soon.  That in my view amounts to a clear admission that, even if she had lived in the Property before, she ceased to reside there as from June 2013.

28.The plaintiff subsequently stated as follows in the said 4^th Affirmation:

“ My Address

42. As I stated above, I was honestly believe that I would be able to return to James and my property shortly so I commence another action under HCA 2229/2014 and kept using Flat F, 12^thFloor, Tower 1, 8 Waterloo Road, Yau Ma Tei, Kowloon, Hong Kong as my address. I have applied for ‘Redirect YourMail’ service from the Post Office so I have been receiving all the correspondences addressed to Flat F, 12^thFloor, Tower 1, 8 Waterloo Road, Yau Ma Tei, Kowloon, Hong Kong until the expiry of that service.

43. As a matter of fact, I was followed by many private investigators hired by insurance company because of my Employment Compensation and Personal Injuries proceedings,I kept moving from different places, including James and myproperty, my relative’s home, my friend’s home in Tai Po, andhotels so I did not have a permanent address at the time when the Writ was issued in the proceedings herein. Furthermore, as I was threaten by different foreign men, I was very scared soI kept using James and my property as my address after thoseforeign men threaten for the personal safety of Jessica and me.

44.   It is an honest mistake and my current residential address is Flat E, 10/F, Un On Building, 130 Camp Street, Cheung Sha Wan, Kowloon.”

29.It appears that the plaintiff was involved in litigation with her former employer and she was claiming employee compensation and damages for personal injuries:

(a)   On 12 April 2011, the plaintiff issued an application under Employees’ Compensation Case No 532 of 2011 against her former employer, Po Leung Kuk Tin Ka Ping Millennium Primary School, for compensation for personal injuries allegedly sustained by her at work.  In the said application, she stated her address as the Property.

(b)   On 6 February 2017, the plaintiff issued a Writ of Summons in the High Court against the same employer claiming damages for personal injuries allegedly sustained by her at work in 2014.  In that Writ, she again stated her address as the Property.

30.The defendant has produced further evidence showing that in her recent communications with the Legal Aid Department and the Social Welfare Department, the plaintiff was still using the Property as her address.

31.The defendant has further produced a copy of an email from the plaintiff to the Deceased dated 23 August 2012 in which she complained to the Deceased that she was being investigated by some insurance company people, obviously in relation to her said employees’ compensation claim. She said the following:

“ I am so worried and I can’t sleep. .... You told me that someone ask you who live in your flat?? …. The insurance company will certainly follow in September because I will see their doctor for assessment of my injury, so they have to find out where they can find me.

Please only confirm Jessica, Edward and I live with you first, because we have agreed to that before.”

32.It also appears that on 12 June 2013 the Deceased made a report to the police in relation to loss of money in his bank account as a result of withdrawals by use of his ATM card.  He also gave an account of how his own ATM card in his wallet seemed to have been replaced by the ATM card of the plaintiff on the same account.  In that statement, he told the police as follows:

“ I have a girl friend Amy with whom I have been dating for about 3 – 4 years. …. Amy has an eight-year-old daughter, Jessica. Amy is a teacher. Amy doesn’t live with me. I don’t know her address.”

33.In view of the evidence referred to above, I find as follows:

(i)   The plaintiff mis-stated her address in the Writs of Summons in the Probate Action and in HCA 2229.

(ii)   The burden is on the plaintiff to satisfy the Court on the balance of probabilities that such mis-statement was made innocently and without intention to deceive.

(iii)   The plaintiff has not discharged such burden.  On the balance of probabilities, I find that the mis-statement of her address in the present two proceedings was not done innocently but was with intention to deceive.

(iv)   Order 23, rule 1 has therefore been triggered and I should therefore proceed to consider whether I should order security for costs to be provided by the plaintiff in all the circumstances.

DISCUSSION ON WHETHER SECURITY FOR COSTS SHOULD BE ORDERED

A.   The Probate Action

34.I deal first with the claim in the Probate Action.

35.As summarised in paragraph 5 above, the plaintiff’s primary claim in the Probate Action is that the Court should pronounce against the validity of the August Will and uphold the validity of the March Will.  She has pleaded that the August Will was executed when the Deceased had no mental testamentary capacity and, further or in the alternative, that it is a forgery.

36.The August Will was on the face of it executed by the Deceased in Illinois in the United States.  There has been filed for the defendant an Affidavit of Michael Overmann (“Mr Overmann”) on 29 May 2018.  Mr Overmann is a US attorney. He deposed to the fact that he saw the Deceased in his office on 5 August 2013 and took detailed instructions from him regarding his wish to make a will and other documents of trust.  On 14 August 2013, he saw the Deceased again and explained to him all the draft documents he had prepared on the instruction of the Deceased.  He asked the Deceased specifically whether anyone, including the defendant, had exercised undue influence on him. The Deceased answered him clearly that he knew what he was doing and that no one had exercised undue influence over him.  Mr Overmann came to the conclusion that the Deceased had the requisite capacity to understand and execute the various documents.  In the absence of the defendant, Mr Overmann asked the same questions of the Deceased and was again satisfied that the Deceased understood what he was doing and that he would sign all the documents of his own free will.  Then, in the presence of Mr Overmann and a colleague of his, the Deceased executed the various documents, including the August Will.

37.The defendant has also produced a letter dated 15 December 2014by a Dr Robert D Aiken (“Dr Aiken”).  Dr Aiken attended to the Deceasedat the Rush University Medical Center from 18 June 2013 until his death on 3 September 2013.  In his said letter, Dr Aiken has written as follows:

“ When seen on August 14^th, 2013 he was responding to Avastin but had become very depressed. James was unable to read when he was seen on August 14^th, 2013. However, in my opinion, he was capable of expressing himself in regards to his capacity to execute a legal document.

I hold this opinion to a reasonable medical certainty.”

38.The August Will was admitted to probate in the State of Illinois on 3 October 2013 with the Circuit Court issuing the Letters of Office to the defendant.

39.According to Mr Overmann, under the laws of the State of Illinois, a petition to contest the validity of a Will must be filed within 6 months after the admission of the Will to probate.  As at the date of his said Affidavit, he was not aware of the existence of such a petition.

40.On 21 March 2014, the High Court in Hong Kong issued the Grant of Probate to the defendant.

41.In order to challenge the validity of the August Will, the burdenis on the plaintiff to adduce evidence for that purpose.  Regarding the attack on the basis of lack of testamentary capacity, the plaintiff has not adduced any medical evidence relating to the mental condition of the Deceased as at 14 August 2013.  Nor am I able to see what medical evidence the plaintiff will be in a position to adduce in this regard when the Deceased was in the United States on that date and he has died.

42.Regarding the attack on the basis of forgery, again the burden ison the plaintiff to prove that the August Will was forged.  It is a very heavy burden.  Expert evidence on handwriting will have to be adduced.  Again,the plaintiff has not adduced such expert evidence so far, although Mr Chung, Counsel for the plaintiff, has indicated to the Court that he will advise his client to adduce such expert evidence.

43.In the abovementioned circumstances, I am of the view that it will be more than an uphill task for the plaintiff to seek to successfully challenge the validity of the August Will.

44.Regarding the second part of the claim in the Probate Action based on the plea of donatio mortis causa, to begin with, it is wrong for such a claim to be included in a probate action.

45.Order 76, rule 1 of the RHC reads as follows:

“ 1. Application and interpretation (O. 76, r. 1)

(1) This Order applies to probate causes and matters, and the other provisions of these rules apply to those causes and matters including applications for the rectification of a will subject to the provisions of this Order.

(2) In these rules ‘probate action’ (遺囑認證訴訟) means an action for the grant of probate of the will, or letters of administration of the estate, of a deceased person or for the revocation of such a grant or for a decree pronouncing for or against the validity of an alleged will, not being an action which is non-contentious or common form probate business.

(3)   In this Order, ‘will’ (遺囑) includes a codicil.”

46.A claim based on a gift allegedly made by a deceased person on the basis of donatio mortis causa is in the nature of a claim for an asset in the estate of the deceased.  Such a claim is a proprietary claim against the estate of the alleged donor of the gift.  It has nothing to do with an action for a grant of probate or letters of administration or the revocation of such a grant or for a decree pronouncing for or against the validity of an alleged will.  A claim on the basis of a gift donatio mortis causa, even if successful,would not by itself entitle the claimant to a grant of representation of the deceased donor’s estate.

47.In short, I cannot see how the Court in the Probate Action can grant any relief to the plaintiff based on the alleged gift donatio mortis causa.

48.In any event, I shall proceed to examine the strength or weaknessof such a claim by the plaintiff, assuming that it is possible for such a claim to be included in the Probate Action.

49.In the case of Re Estate of Lung Nga Lai Eilly [2014] 4 HKLRD 829 at 831, the Court of Appeal set out the legal principles of donatio mortis causa in paragraph 7 of its Judgment as follows:

“ The legal principles of donatio mortis causa

7. In [26]–[29] of her judgment, the Trial Judge has correctly set out the legal principles of donatio mortis causa as follows:

[26] The law will not perfect an imperfect gift. This principle is well-established; see Milroy v Lord (1862) 45 ER 1185,1189. This authority was cited by Andrew Cheung J in Official Administrator v Luk Hoi Tong Co Ltd [2005] 3 HKC 615, para. 102.

[27] However, donatio mortis causa is one of the exceptions tothis principle. The reason is that a donatio mortis causa is a singular form of gift, being a gift which is neither inter vivos nor testamentary. It is an act inter vivos by which the donee is to have the absolute title to the gift not at once but if the donor dies. If the donor dies the title becomes absolute not under but as against the personal representative of the donor. In order to make the gift valid it must be made so as to take complete effect on the donor’s death; see Re Beaumont [1902] 1 Ch 889, 892.

[28] In addition, donatio mortis causa was held to be a trust raised by operation of law. Upon the death of the donor,his personal representative will hold, as trustee, the legal title to the gift for the done; see Duffield v Elwes (1827) 1 Bli (NS) 497, 543.

[29] There are three requirements of a donatio mortis causa:

(1) The donor must have made the gift in contemplation though not necessarily in expectation of death;

(2) The donor must have delivered to the donee the subject matter (in the case of a chose in possession) or the indicia of title (in the case of a chose in action) of the gift, or transferred to him the means of getting at that subject matter or indicia of title, eg delivering a key, like car keys, or a key to a box containing the indicia of title, intending to part with dominion over the gift;

(3) The gift must be such as to be absolute and complete only on the donor’s death so that it is revocable beforethen. A condition to this effect need not be expressedand will normally be implied from the fact that the gift was made when the donor was seriously ill.

…”

50.The way that the plaintiff has pleaded her case in paragraph 25 of the Re-Amended S/C is as follows:

“ Donatio Mortis Causa

25. Further or in the alternative, the Plaintiff relies on the doctrine of donation mortis causa in that the Deceased had,in contemplation of his death, made a gift bestowing all his property, real and personal, to the Plaintiff conditional upon the death of the Deceased, and that on or about 12^th March 2013, the Deceased had effectively parted with the dominion of and/or transferred his property to the Plaintiff. The circumstances under which the Deceased had made such a gift to the Plaintiff are particularised herein below:

PARTICULARS

(a) As pleaded in paragraph 10 hereinabove, the Deceased came to the realization of the quick and serious deterioration of his health when medical examinations revealed that there were four tumours in his brain, one ofwhich was as large as 5.4 centimetres. By this time, theDeceased’s cognitive abilities had already diminished and had difficulty moving and/or speaking.

(b) Under the impression and contemplation that death was imminent, on or around early March, the Deceased suggested to the Plaintiff that they should get married as soon as possible and assured the Plaintiff that he will give the Plaintiff all his property, money and belongings (the ‘gift’) upon his death.

(c) The Deceased, intending the gift to be conditional upon his death, attended a solicitor’s firm named Messrs.Anthony Kwan & Co. and executed the true last will in favour of the Plaintiff on 12^th March 2013.

(d) Since then, the Deceased had parted with the dominion of and/or transferred his property, through physical or constructive delivery, to the Plaintiff. This is evidenced by:

PARTICULARS

(i) The confirmation of the delivery and/or handing over of a set of keys to the 2^nd Property (the 1^stProperty was and is rented out at all material times, the Deceased did not possess any key to the 1^st Property);

(ii) The handing over of a bank statement of a mortgage loan account (Account No.: 127-763142-080) in the Hong Kong and Shanghai Banking Corporation Limited (‘HSBC’);

(iii) The handing over of Integrated Account Portfolio Summary of a bank account (Account No.: 127-372324-833) in HSBC;

(iv) The handing over of a Unit Trust Contract Note of a unit trust account (Account No.: 127-372324-380) in HSBC;

(v)   The handing over of Tax Year 2012 Year-end Summary of Schwab One International Account(Account No.:5310-3340).”

51.In short, the plaintiff is relying on the handing over by the Deceased to her of a set of keys to the Property, a bank statement of a mortgage loan account, an Integrated Account Portfolio Summary of a bank account, a Unit Trust Contract Note of a unit trust account and a Year-end Summary of Schwab One International Account as being acts of gift by the Deceased which satisfy the requisite test for donatio mortis causa. If I understand her correctly, she seems also to rely on the making of the March Will by the Deceased for this purpose.

52.As I have indicated earlier, it is not for me to make conclusive findings of fact at this stage.  In my view, the making of the March Will can certainly not be relied on as a will is capable of being revoked at any time by its maker.  Furthermore, I am not convinced at all that the acts of handing over of the items by the Deceased as referred to above amount to acts which would satisfy the requisite test.  I do not view any of them as indicia of title to anything.

53.In short, I take a rather dim view of the chances of success of the plaintiff in the Probate Action.

B.   HCA 2229

54.I now deal with HCA 2229.

55.As mentioned above, HCA 2229 relates solely to the Property.  As set out in paragraph 15 above, the plaintiff claims that she has acquired the beneficial interest in the Property on the basis of a proprietary estoppel against the Deceased and also on the basis of a constructive trust arising out of a common intention between the Deceased and herself to own the Property as joint tenants, which common intention had crystallized prior to the purchase of the Property by the Deceased.  All her other claims in HCA 2229 are premised upon her alleged beneficial interest in the Property.

56.The factual basis of her claim of a beneficial interest in the Property by reason of the said alleged proprietary estoppel and constructive trust is set out in the S/C as referred to in paragraphs 12, 13 and 14 above.

57.It can be seen that, in paragraph 3 of the S/C, the plaintiff has pleaded that “she paid for all the furnishing of the said Property including but not limited to sofa couches, dining table set, television set, electric fans, toaster, rick cooker” and, further, that she had been paying the utility charges and all other outgoing expenses for the maintenance and repairs of the Property “throughout the cohabitation”.  She has, however, hardly produced any documentary evidence to support her allegations of payment in the various Affirmations filed by her in these proceedings.

58.On the other hand, the defendant has produced an email from the plaintiff to the Deceased dated 8 May 2012 which tends to show that she and her daughter were staying in the Property temporarily whilst the Deceased was away and that she had to make a payment to him for the electricity consumed.  In that email, she wrote as follows:

“ It is very hot in Hong Kong since you have left, so I have the air- conditioner on at night. I have leave you $500 for the electricity bill. If it’s not enough, please let me know. THX.”

Such a message would hardly suggest that she and the Deceased were cohabiting or that she had been paying for the outgoings.

59.The above, coupled with the statement by the Deceased to the police in June 2013 referred to in paragraph 32 above, in my judgment, do not assist in supporting the plaintiff’s claim.  On the contrary, they tend to undermine the plaintiff’s case.

60.Furthermore, even if the plaintiff had made certain payments towards the maintenance of the Property, that would not be sufficient to giveher a beneficial interest in the Property.  Most important of all, there seems to be no dispute that it was the Deceased who had paid all the mortgage instalments on the Property.

61.In the circumstances set out above, I also take the view that the plaintiff’s case in HCA 2229 is rather weak.

DELAY

62.The plaintiff relies on the delay on the part of the defendant in making the applications for security for costs and argues that for that reason they should fail.

63.I am of the view that there has been no unjustifiable delay on the part of the defendant which has caused any prejudice to the plaintiff.  After the filing of the last pleadings in the two actions in the latter part of 2015, the plaintiff did not take further steps and the two actions just went to sleep.  In the meantime, the plaintiff has registered the Writ of Summons in HCA 2229 against the title to the Property in the Land Registry.  Hence, the defendant must deal with that by proceeding in the two actions.  Hence, the present applications for security for costs.  I see nothing wrong with that. 

64.Furthermore, it is stated in Note 23/3/31 of Hong Kong Civil Procedure as follows:

“ The right to security is not waived by service of the defence, and an order for security may be made at any stage of the proceedings.”

65.In all the circumstances, I am of the view that the so-called “delay” by the defendant does not assist the plaintiff.

STIFLING THE PLAINTIFF’S CLAIMS

66.The plaintiff further asserts that an order for security for costs would have the effect of stifling her claims in the proceedings.

67.The plaintiff had applied for legal aid in order to enable her to proceed with the two actions.  Her application had been refused.  She asserts that she would have no ability to provide security for costs.

68.The burden is on the plaintiff to show that the making of an order for security would stifle her claims in the two actions.  She has not provided details of her financial situation.  On the evidence, she sold her own flat on the 31^st Floor of “8 Waterloo Road” in April – May 2008 for about $8 million.  There is no evidence regarding what has happened to that sum of money.  Furthermore, on the evidence, the plaintiff is a divorcee.  There is no evidence as to how much alimony she has been receiving or how much she earns, eg, as a teacher.  Furthermore, she now has a firm of solicitors and counsel acting for her not on legal aid.

69.In the above circumstances, I am of the view that the plaintiff has failed to show that any order for security for costs would have the effect of stifling her claims in the two actions.

DISPOSITION

70.Having taken into account all the circumstances set out above, including the fact that in my judgment the mis-statement of her address in the Writs of Summons in the two actions before me was not done innocentlyor without intention to deceive, and having conducted the requisite balancing exercise, I have come to the conclusion that I should order the plaintiff to provide security for costs.

71.Having considered the Skeleton Bills of Costs put forward by the defendant and bearing in mind the fact that there will probably be some duplication of work between the two actions, in the exercise of my discretion,I order that the plaintiff should provide security for costs in the following sums:

(i)   in the Probate Action, the sum of $800,000; and

(ii)   in HCA 2229, the sum of $600,000.

ORDERS

72.In the Probate Action, regarding the defendant’s Summons issued on 29 May 2018, I make an Order in terms of paragraphs 1, 2 and 3 thereof, subject to alteration in paragraph 1 thereof of the specified time of “14 days” to “21 days” and the specified amount of “HK$1,212,650” to “HK$800,000”.

73.In HCA 2229, regarding the defendant’s Summons issued on 29 May 2018, I make an Order in terms of paragraphs 1, 2 and 3 thereof, subject to alteration in paragraph 1 thereof of the specified time of “14 days” to “21 days” and the specified amount of “HK$939,985” to “HK$600,000”.

74.I make an Order nisi that the plaintiff do pay to the defendant the costs of and incidental to the said two Summonses, to be taxed if not agreed.

Mr Hylas Chung, instructed by Huen & Partners, for the plaintiff (in both cases)

Ms Frances Lok, instructed by Haldanes, for the defendant (in both cases)