Cheung Ping Sum v. Wong Chi Hang, As Administrator of the Estate of Wong Sun, Deceased

HCMP 1490/2016

[2019] HKCFI 2738

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1490 OF 2016

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BETWEEN

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DECISION ON COSTS

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Introduction

1.On 6 September 2019, I entered judgment in favour of the plaintiff (the “Plaintiff”) against her step-son (the “Son”).  I granted her various relief, including revoking the letters of administration of the estate of her husband (the “Father”) granted to the Son, making a fresh grant to the Plaintiff and ordering the Son to give a full and proper account of his administration of the said estate.  I also made an order nisi that the costs of this action, including all costs reserved, be paid by the Son to the Plaintiff, to be taxed if not agreed; and the Son’s own costs be taxed in accordance with the Legal Aid Regulations.  The Plaintiff seeks to vary the costs order nisi pursuant to section 17(3) of the Legal Aid Ordinance (“the Ordinance”) on the grounds that the Son has acted improperly in defending the proceedings.  She seeks an order that the Son, who is legally aided, be personally liable as if he were not legally aided and that her costs occasioned by her claim be paid out of the Son’s share of the estate as in the Court of Final Appeal decision in Cheung Pui Yuen v Worldcup Investments Inc[1].  Her alternative and fallback position is that her costs be paid out of the estate.  The parties agreed that the application be disposed of on paper. 

Background

2.In a nutshell, this action is about a family dispute between the Plaintiff and the Son about the beneficial ownership of a property (the “Property”) registered under the name of the Father who died intestate on 6 April 2012.  The Property was acquired in 1981 and held in the joint names of the Father and his former wife as their matrimonial home.  It was registered in the sole name of the Father after his former wife’s demise.  On 13 March 1991, the Plaintiff married the Father in China.  Since 2000, the Plaintiff moved into the Property using it as her matrimonial home with the Father.  The Son continued to live in the Property.  The Plaintiff and the Father had a long standing relationship of 21 years.  She had no children of her own and had a harmonious relationship with the Son and his siblings.  It was out of the trust built up from that long and harmonious familial relationship that the Plaintiff renounced her right to administer the estate in favour of the Son.  As result, the letters of administration of the estate was granted to the Son on 31 July 2013.

3.After the Son was appointed as administrator of the Father’s estate, his relationship with the Plaintiff started to turn sour. On two occasions in July 2015, the Son created a scene and drove the Plaintiff’s sister away while she was staying in the Property.  Then he attempted to drive the Plaintiff out of the Property under the pretext that the Property had to be renovated.  The Son and his sisters also attempted to coerce the Plaintiff to sign a draft deed and draft assent to transfer the Property to the Son purportedly under the 2016 Family Arrangement on 29 May 2016.  The Plaintiff had to run away from the Property in the early morning that day to avoid being forced into signing the documents.  These incidents cumulated in the Plaintiff instituting the present action to recover her right to administer the Father’s estate to protect her share in the estate.

4.The Son is legally aided under the Legal Aid Ordinance (the “Ordinance”); the Plaintiff is not.  The Son’s defence is that he is the beneficial owner of the Property and he counterclaims a declaration to that effect.  His case is rested on three grounds:

(1)  that he had paid or contributed to the purchase price of the Property;

(2)  that the Property was purchased with the common intention as ancestral home for the use of the family which will eventually be passed to the Son as the sole male descendant of the family (the “ancestral home intention”); and

(3)  that under a family arrangement made in 2010 (the “2010 Family Arrangement) to which the Plaintiff was a party, the Property will be transferred to the Son after the Father’s death.

These defences were rejected.

5.The thrust of the Son’s objection to vary the costs order nisi is that a legally aided person’s costs liability is limited by section 16C of the Ordinance to the amount of his contribution, if any, paid under the Ordinance.  To invoke section 17(3), the aided person’s improper conduct had to be as culpable as fraud or misrepresentation required in nullifying the legal aid certificate under section 17(1).  The mere fact that the aided person was unsuccessful, disbelieved or was found to be dishonest is not sufficient to amount to improper conduct.  The Son also argues that his case is distinguishable from Cheung Pui Yuen.

The legal aid regime

6.The purpose of the Ordinance as stated in its preamble is “To make provision for the granting of legal aid in civil actions to persons of limited means and for purposes incidental thereto or connected therewith.”  To qualify for legal assistance under the Ordinance, an applicant has to satisfy the means test under section 5 for the legal aid or under section 5A for supplementary legal aid.  In addition, he has to satisfy the merits test under section 10(3).  Basically, he has to show that he has “reasonable grounds for taking, defending, opposing or continuing such proceedings or being a party thereto”.  If he meets those requirements and subject to a few exceptions such as the trivial advantage to be gained by the litigation, the simple nature of the proceedings and unreasonableness for the aided person to institute the proceedings, the Director of Legal Aid (“the Director”) may grant him a legal aid certificate which would entitle him to the benefits under section 16B on payment of a contribution, if appropriate and if so required by the Director.  In short, those benefits are that the expenses incurred in connection with the proceedings to which the legal aid certificate relates shall be refunded to him by the Director.  In other words, his litigation will be paid by public funds.  Under section 16B(f), upon being issued a legal aid certificate, the legally aided person’s liability for costs shall be determined in accordance with section 16C.

7.Section 16C distinguishes between three different categories of costs.  These are: (1) costs as between the aided person and the Director (section 16C(1)(a)); (2) party and party costs ordered by the court to be paid by the aided person to a non-aided party in the proceedings (section 16C(1)(b)); and (3) party and party costs ordered by the court to be paid by the aided person to another legally aided party (section 16C(1)(c)).  The overall scheme under section 16C is that the aided person’s and the Director’s liability for costs shall not exceed the aided person’s contribution, except where the non-aided opponent is, generally speaking, a successful defendant or respondent.  In the usual or non-excepted cases, the Director shall pay such costs to the extent that the aided person’s contribution is in excess of the costs incurred by the Director on his behalf: section 16C(1)(b)(ii).  In respect of the excepted cases, the non-aided party may recover his costs ordered to be paid by the aided person against the Director: section 16C(1)(b) (i), (ia) and (ib).  The rationale for these provisions is simple.  The non-aided party would not have incurred his costs had the Director not funded the aided person in bringing the proceedings.  The Director having funded the litigation against a successful defendant or respondent, they should be entitled to recover their costs thus incurred from the Director.  In the non-excepted cases, the successful non-aided party would suffer no prejudice in being prevented from recovering his costs against the aided person or the Director for it was he who chose to institute proceedings against the aided person, who in any event would have no means to satisfy an order for costs beyond his contribution, which in the fair opinion of the Director is the amount the aided person could spare for the proceedings.  This rationale explains why section 16C draws a distinction between cases where the aided person is, generally speaking, a plaintiff or a defendant.

8.However, section 17(1) gives the court jurisdiction to depart from the above general rule.  Under section 17(1), the court may order an aided person to pay the costs of the Director and of the counsel and solicitor who acted for him and/or the costs of the other party, where it appears to the court that a legal aid certificate has been obtained by fraud or misrepresentation.  Section 17(3) gives the court similar jurisdiction where it appears to the court that the aided person has acted improperly in bringing or defending any legal proceedings or in the conduct of the proceedings.  Under such circumstances, the costs shall be taxed as if the party ordered to pay them were not an aided person: section 17(4). 

9.In the present case, the Plaintiff’s costs of the action are governed by section 16C(1)(b)(ii) and her costs in defending the Son’s counterclaim are governed by section 16C(b)(ia). In respect of her costs of the action, she may only recover what the Son has contributed (if any) after deducting the costs incurred by the Director on the Son’s behalf (ie the Son’s own costs).  In respect of her costs of defending the counterclaim, she may recover the taxed costs against the Director, which in the circumstances would be very minimal.  Thus, the costs order nisi would practically be an empty order.  Hence, the Plaintiff seeks to vary the costs order nisi by invoking section 17(3).  Her application is premised on the Son’s impropriety in defending or in the conduct the proceedings. 

10.The Son argues that as section 17(3) is an exception to the general rule under section 16C, the “improper acts” required to trigger the operation of section 17(3) must be culpable acts such as fraud or misrepresentation required to nullify the legal aid certificate under section 17(1).  The threshold is very high.  These sub-sections read:

“ (1) Where it appears to a court or judge that a legal aid certificate has been obtained by fraud or misrepresentation, 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 costs of the other party, or the costs of the Director and such counsel and solicitor and such party.

…

(3) 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.” (My emphasis in italics.)

11.On a fair reading of the Ordinance, these sub-sections are clearly intended to have different scopes of operation.  Sub-section (1) is concerned with the conduct of an aided person in obtaining the legal aid certificate.  It governs the dealing between an aided person and the Director to which the non-aided party is not privy.  What triggers the operation of sub- section (1) is the aided person’s fraud and misrepresentation in obtaining the legal aid certificate.  The triggering event is very specific.  The scope of operation is very narrow being limited to the application for the legal aid certificate. The non-aided opponent has no knowledge of such fraud or misrepresentation.  He has no access to the communication between the aided person and the Director which is covered by professional privilege.  It could hardly be invoked by the non-aided opponent, though in an appropriate case such fraud or misrepresentation could be inferred from the aided person’s pleadings, his witness statements and the court’s finding of fact. The sub-‌section would usually be invoked by the Director to recover his costs in proceedings in respect of which the legal aid certificate would not have been granted but for the fraud or misrepresentation practised by the aided person.

12.Sub-section (3) is directed at an aided person’s conduct in bringing or defending any legal proceedings or in the conduct of the proceedings.  Such conduct would be committed after the issue of the legal aid certificate.  The triggering event is the aided person’s improper conduct.  Sub-section (3) clearly has a much wider and different scope of operation.  The opponent has knowledge of such impropriety and is in a position to bring such improper conduct to the attention of the court in order that the court may do proper justice as to costs.  The use of the term “acted improperly …” in that sub-section is particularly pertinent.  The term has a wide import.  It goes beyond the bounds of fraud, misrepresentation or generally speaking, dishonesty.  It includes even impropriety in the conduct of litigation, such as raising unnecessary issues, causing delays and inactions which has the effect of wasting the opponents’ costs while his own costs liability is sheltered behind the legal aid certificate.  The sub-section covers culpable conduct such as fraud and misrepresentation in obtaining the legal aid certificate.  But by no reading of the Ordinance as a whole and sub-section in particular could the concept of fraud and misrepresentation be read into the sub-section so as to qualify or limit impropriety to such culpable conducts only.  By deliberately refraining from making reference to fraud and misrepresentation and adopting a term of such a wide import, it is manifestly clear that the legislative intent was to give section 17(3) a different and much wider scope of operation, though it may overlap with the scope of operation under section 17(1).

13.The term has such a wide import that it is incapable of definition.  I can only give examples of what would amount to improper conduct.  The legal aid certificate provides a convenient starting point for determining what is improper conduct.  The legal aid regime is to enable a person who has no or insufficient means to pursue or defend his case, if he has at least an arguable case on the merits. The legal aid certificate is granted on the basis that the case as presented to the Director by the legal aid applicant is genuine and which the Director is satisfied as having met the merits test.  It is not given to enable someone to try his luck in a game of chance by presenting to the Director a case which he knows is not genuine or bona fide but which he thinks has a better chance of success.  Hence, if an aided person obtains a legal aid certificate by presenting a case to the Director which he knows is false or if he withholds information from the Director which he knows is material for the Director’s decision whether to grant a legal aid certificate, he abuses the legal aid regime and loses his protection under the regime.  This is the obvious section 17(1) situation of fraud and misrepresentation.  It is simple dishonesty in making the legal aid application.  Such impropriety could be inferred by contrasting the aided person’s pleadings and his witness statements which must reflect the case he presented to the Director against the finding of the court. 

14.But there is another dimension in such dishonest conduct. Probably, at trial the aided person and/or his witnesses would present to the court on oath or under affirmation evidence for the purpose of advancing his case which he knows is false.  Such conduct would be dishonest and would amount to a sufficient act of impropriety in bringing or defending the legal proceedings and in the conduct of the litigation. 

15.The Son argues that section 17(3) is not engaged even if the evidence given by the aided person is found to be false, dishonest or incredible.  I cannot agree with this over-sweeping proposition at least insofar as dishonest conduct is concerned.  Falsity is a state of affairs that a statement is not true.  Incredible means a statement or its maker is not to be believed.  That a person is found to be incredible does not necessarily infer dishonesty on his part.  The court will not readily jump to the conclusion that failure in proving a case or in raising a defence is conclusive proof of impropriety.  A truthful witness including an aided person may, through no fault of his own, be assessed by the court as an unconvincing witness and disbelieved.  The court will bear in mind uncertainty in litigation and will not readily penalize a failure as dishonesty or improper conduct.  However, there is a distinction between dishonesty and the court’s finding that a witness’ statement is false or that he is not to be believed.  The distinction lies in whether the maker of a statement has subjective knowledge of its falsity.  Giving false testimony on oath or under affirmation knowing it is untrue is contemptuous and definitely dishonest.  It is improper conduct sufficient to invoke operation of section 17(3).  Whether an aided person is dishonest or is merely disbelieved is a question of fact.  It has to be assessed by testing his evidence not just against the evidence of other witnesses who are ultimately believed but also against contemporaneous documents and incontrovertible evidence.  As with any proof of dishonesty, the standard is very high.  The court will not readily label a witness who is disbelieved as dishonest.  The court will also ignore minor acts of dishonesty in the aided person’s evidence which does not have any serious impact on the outcome of the proceedings. 

16.Other improper conduct includes impropriety in the conduct of the litigation, such as raising unnecessary issues, causing delays and inactions which are calculated to have the effect of wasting the opponents’ costs.  It would be outrageous for an aided person to use public funds to waste his opponent’s costs, while his own costs liability is sheltered behind the legal aid certificate.  Such abuse of the legal aid regime must amount to impropriety in the conduct of the proceedings.  Conducting litigation in a frivolous and vexatious manner and dishonestly also falls into this category.

The Son’s conduct

17.The single and most important fact which underpins the Son’s defence and counterclaim based on constructive trust, resulting trust and proprietary estoppel is whether he had paid or contributed to the purchase price of the Property.  The factual issues raised are:

(1)  whether the Son had paid or contributed to the purchase price of the Property;

(2)  whether the Property was purchased with the common intention to be used as ancestral home and to be passed to the Son after the Father’s death;

(3)  whether the parties had entered into the 2010 Family Arrangement, and, if yes, the terms of that arrangement; and

(4)  whether the Son has taken away any personal chattels of the Father without accounting for the same.

All four factual issues were resolved against the Son. 

18.My findings on the Son’s contribution to the purchase price of the Property are contained in paragraphs 29 – 40 of the Judgment.   In paragraph 40, I concluded as follows:

“ On the totality of the evidence, including the contemporaneous documents and the surrounding circumstances, I do not accept the Son’s evidence that he had paid the full purchase price of the Property. I accept, however, that he had contributed to the household expenses, settled some occasional debts for the Father and gave him some maintenance payments.”

I accept that the Son had contributed to the household expenses, settled some occasional debts for the Father and given him some maintenance payments, but not that he had contributed to the purchase price.  While holding that the Son had failed to establish the extent of his contribution, I was in fact far from being satisfied that he had proved he contributed to the purchase price of the Property.  In paragraph 91 of the Judgment, I held:

“ … The Son has put up a false case with a view to keep the Property solely to himself and with the collaboration of his sisters.”

This conclusion is based on my finding of the Son’s dishonesty in various parts of the Judgment.  In paragraph 85, I found:

“ … on my finding, the Son was shown to be dishonest in more serious matters as to assert that he had paid or contributed to the purchase price of the Property and the ancestral intention. He even did so at the expense of smearing the Father’s financial ability.”

In paragraph 87, in relation to his accusation that the Plaintiff had misappropriated the jewellery belonging to his sister, I found:

“ … On the contrary, the Son’s and Fan’s assertions that there were packets of jewellery in the safety box left by their Mother is incredible. Their Mother died almost thirty years ago. If she had left any jewellery for her daughters, they must have been distributed long time ago if not shortly after her death. I find that assertion a dishonest attempt to smear the Plaintiff. It is not credible and it damaged the Son’s and Fan’s credibility. I accept the Plaintiff’s evidence that there was nothing substantial in the safety deposit box other than the title deeds of the Property.”

19.The Son’s contribution to the purchase price of the Property is the linchpin in his defence and counterclaim.  It is the single and most important and material factual issue in this action.  The Son presented a false case, on my finding, dishonestly.  He acted improperly in defending the action and bringing his counterclaim.  For the purpose of proving his case, he went as far as to smear his Father and the Plaintiff.   That was a clear act of impropriety in the conduct of these proceedings.

20.In relation to his ancestral home defence, the Son testified that the Plaintiff was his licensee.  He repeatedly changed his evidence under cross-examination.  I found that assertion a recent concoction. I held in paragraph 55:

“ Under cross-examination, the Son explained that he had forgotten to mention those matters. That is incredible as those matters are at the heart of the dispute in which the Son claimed to be the beneficial owner of the Property and that the Plaintiff was only a licensee whose continued stay in the Property was at his mercy. Then, the Son changed his evidence and asserted that he did not raise those matters as he did not have the supporting evidence on 15 June 2016. This is flatly contradicted by his written statement. Then, he changed and asserted that Fan had referred to those matters. Again, that turned out to be wrong. Then, he explained the omission by saying that he had no legal knowledge and would only raise these points before the court. Lastly, he explained that he did not mention those matters to avoid irritating the Plaintiff. I find no conviction in that explanation as the parties’ relationship had turned very sour by then. Why should the Son be concerned about the feeling of the Plaintiff? As those matters go to the heart of his case, he should have hit the nail on the head. But those matters were not even raised in the earlier correspondence from his solicitors and notices issued by the Son. The Son’s failure to refer to those matters suggests that they were recent concoctions.”

Such recent concoction is another example of impropriety in the conduct of these proceedings.

21.The Plaintiff quotes the following dicta of Poon J (as he then was) in Standard Chartered Bank v Li Wai Ping [2], seemingly in support of her argument that where an aided person is found to have dishonestly put up a false or incredible case, he shall appear to have acted improperly:

“ 12. The Wife, as I have found, had fabricated evidence in order to make good her defence of undue influence and misrepresentation. Contrary to her submission, she had acted most improperly in conducting both actions. Section 17(3) applies with full force to her. I will order her to bear all the costs ordered against her below personally as if she were not an aided person. Consequently, the limits imposed by s 16C(1) do not arise.”

The Son argues that Li Wai Ping is not an authority for such proposition.  With respect, I cannot agree.  According to the Cambridge English Dictionary, “fabricate” means “to invent or produce something false in order to deceive someone” [3].  A finding that the wife fabricated evidence must necessarily mean she dishonestly gave evidence knowing it was untrue.  The dicta quoted above must necessarily be the ratio decidendi of that case.  I cannot see how such dishonest conduct could not amount to impropriety.

22.The Son also seeks to distinguish Li Wai Ping from the present case in that the wife in Li Wai Ping was granted legal aid in her personal capacity whereas the Son has been granted legal aid in his representative or fiduciary capacity.  In my view, that is a distinction without any difference.

23.On my finding, the Son’s case was fabricated.  He raised numerous issues which were all resolved against him.  He was just trying his luck by raising multiple cases, all of which were concocted.  He has no reasonable ground for defending the proceedings.  While I would not go that far as to find that he has obtained the legal aid certificate by fraud or misrepresentation (at least the Director has not so asserted), I am well satisfied that this is a clear case of an aided person acting improperly in defending the proceedings brought against him.  It is appropriate to exercise my jurisdiction under section 17(3) and (4) to order the Son to pay the costs of the Plaintiff to be taxed as if he were not an aided person. 

Costs out of the Son’s share of the estate

24.The Plaintiff seeks an order that as the personal representative of the Father, she be given the liberty to recover the costs to be paid by the Son to the her out of the Son’s share in the estate.

25.A similar order was made in Cheung Pui Yuen v Worldcup Investments Inc [4]. At paragraph 83, Lord Scott of Foscote NPJ held:

“ I would direct, also, that the executors be at liberty to set-off costs due to the plaintiffs out of the estate against costs due to the executors from the plaintiffs, so that only the balance would be payable, with liberty to the executors, if the balance is a sum due from the plaintiffs, to recover the balance out of the plaintiffs’ share in the estate.”

26.The Son suggests that the order was a costs order nisi which was subject to variation and might have been an order compromised by the parties.  He argues that there is no legal basis entitling the Plaintiff to a charge, which is a proprietary relief, on his share in the Father’s estate for recovering her costs which is merely a personal claim against him.  He submits that in any event the Judgment does not set out the legal basis for such an order.  

27.Though Lord Scott NPJ did not state the legal basis for making such an order, it is very common for such orders to be made for setting off a defendant’s counterclaim or cross-claim against the claimant’s claim.  It is such a common practice that requires no authority.  The Plaintiff as administratrix has obligation to distribute to the Son his share in the Father’s estate, while in her personal capacity as a beneficiary she has a claim against the Son for costs.  The Son’s share in the estate and the Plaintiff’s costs arose out of the same dispute and about the same subject matter.  They are no different from a claim and counterclaim between parties litigating in their personal capacity.  It is expedient that the Plaintiff be given the liberty to recover the costs to be paid by the Son to her out of the Son’s share in the estate now in her hands as administratrix and to be distributed to him.  The Son’s argument based on the distinction between proprietary relief and personal remedy is irrelevant and unmeritorious.

Costs out of the estate

28.The Plaintiff’s alternative claim is for costs to be paid out of the estate.  The Son objects.  Having reached the above conclusion that the Son is personally liable for costs, there is no need to consider the Plaintiff’s alternative claim.  If it becomes necessary for me to make a ruling, I would, for reasons wholly different from those advanced by the Son, find it inappropriate to order costs to be paid out of the estate.  I shall deal with the parties’ arguments very briefly. 

29.The Son objects on the basis that the Plaintiff is making a Beddoe application, but not acting as the personal representative she may not do so without making a pre-emptive costs application in advance.  He relies on paragraph 85/2/3 of Hong Kong Civil Procedure [5].  I do not find it necessary to quote the passage relied on by the Son as his reliance on that passage has been misplaced.  As stated therein, no pre-emptive order should be made in cases where there was hostile litigation.

30.The principle applicable to the issue of costs in cases of this nature was considered by Lord Scott NPJ in Cheung Pui Yuen. He adopted the principle as set out by Kekewich J in Re Buckton [6]and his categorisation of the three classes in cases.  He held in paragraphs 56 – 57:

“ 56. The case on costs, as explained by Mr Thomas, is based on the principle that where proceedings have been properly instituted for the benefit of a trust fund, or a deceased’s estate, the court may, in an appropriate case, make an order for the costs of the proceedings to be borne by the fund or estate, as the case may be. The principle was explained by Kekewich J in Re Buckton [1907] 2 Ch 406 at pp.414/415. He referred, first, to cases in which trustees ask the court to determine some question which has arisen in the administration of the trust. In such cases, said Kekewich J, the general rule would be that the costs of all necessary parties would be taxed as between solicitor and client and paid out of the estate. He then referred to a second class of case in which the question for determination by the court is raised not by the trustees but by some of the beneficiaries. In such a case, if the question raised would have justified an application by the trustees but for some reason or other the application has been made by beneficiaries, the same costs consequences, he said, should follow:

The application is necessary for the administration of the trust, and the costs of all parties are necessarily incurred for the benefit of the estate as a whole. (p.415)

Kekewich J distinguished, however, the first and second classes of case from the third class, a class where the application to the court is made by a beneficiary but is, in substance although not in form, an adverse claim made in hostile litigation. In such a case, said the judge, the rule applicable to hostile litigation should be applied and the unsuccessful party ordered to pay the costs.

57.       Kekewich J pointed out, at p.415, the difficulty in many cases in deciding whether the particular case falls within the second class or the third class he had described but, subject to that difficulty, the distinction is a legitimate and well recognized one.  It is relied on by Mr Thomas.  He is entitled, in my opinion, to do so. …”

31.The Plaintiff is entitled to the major share of the Father’s estate.  It would have been convenient and appropriate for her to administer the estate.  However, because of her trust in the Son, she renounced her right to administration of the estate in his favour.  But, the Son abused that trust.  Not only did he not distribute to the Plaintiff the share of the estate due to her, in collaboration with his siblings he wrongfully asserted a false claim over the entire legal interest in the Property.  That Property practically represents the entirety of the Father’s estate.  The Son has a serious and real conflict of interest in continuing in his position as the administrator.  It became necessary for the Plaintiff to institute these proceedings to enforce the unspoken intention of the Father and to protect her interest under the Father’s intestacy.  The Son resisted the proceedings rigorously.  He challenged the Plaintiff’s claim.  He raised numerous defences which were all concocted.  He was claiming the entire interest in the Property.  He was deeply interested in this litigation.  He was far from adopting a neutral position as trustee.  This is a hostile litigation, which falls within the third type of case categorised by Kekewich J.  Costs should follow the event and should not come out of the estate: see Alsop Wilkinson v Neary [7].  Also for the same reason, I dismiss the Plaintiff’s alternative argument for costs to be paid out of the estate.  The effect of such a costs order would be to relieve the Son from costs liability occasioned by his wrongful acts at the expense of reducing the size of the estate payable to the beneficiaries, particularly, the Plaintiff who was utterly without fault.  Such a costs order would be unjust to the Plaintiff and unfairly favourable to the Son.

Costs of the counterclaim

32.As explained in paragraph 9, the Plaintiff’s costs in the counterclaim falls within section 16C(1)(b)(ia). She may recover those costs against the Director.  However, for the same reasons as the Plaintiff’s costs in the action, it is appropriate that those costs be paid by the Son and be taxed as if he were not an aided person and recoverable by the Plaintiff out of his share of the estate.

Conclusion

33.For the above reasons, all costs of this action, including the costs of the Son’s counterclaim and this application shall be borne by the Son personally and be paid out of his share of his Father’s estate to be distributed to him.  The Son’s own costs shall be taxed in accordance with the Legal Aid Regulations.

Written submissions by Mr Tom Ng, instructed by Tai, Tang & Chong, for the plaintiff

Written submissions by Mr Matthew C S Chong, instructed by Mandy Wan & Co, assigned by Director of Legal Aid, for the defendant