Anthony Eric Ryan Hotung v. Hotung, Michael Eric a.B. and Others
Read the full judgment text of HCA 1216/2006 on BabelCite. This High Court CFI judgment was delivered on 9 March 2021.
1. This is a claim for breach of trust and removal of trustee.
Cited by 1 case · Cites 4 cases
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HCA 1216/2006 [2021] HKCFI 601 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE ACTION NO. 1216 OF 2006 _____________ BETWEEN
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______________ JUDGMENT ______________ 1.This is a claim for breach of trust and removal of trustee. Background 2.The Plaintiff, Mr Anthony Eric Ryan Hotung (“Anthony”), is the son of the 2nd Defendant Mr Eric Edward Hotung (“Eric”). The 3rd Defendant is a company called Hotung Estates Ltd (“Hotung Estates”). 3.Eric died on 20 September 2017. He had 8 children by his wife Madam Patricia Ann Shea: Michael Eric Hotung (“Michael”), Robert Eric Hotung, Eric Shea Kim Hotung, Sean Eric Mclean Hotung (“Sean”), Anthony, Mara Tegwen Hotung Lamb (“Mara”), Gabrielle Marie Hotung (“Gabrielle), Sheridan Patricia Hotung Shea (“Sheridan”). 4.The original 1st Defendant, the late Madam Ho Yuen Ki (“Ho”), had a brief romantic involvement with Eric in the 1950’s. They had 2 children. 5.Under a Declaration of Trust dated 29 November 1979 (the “HEL Trust”), Ho held as trustee 10,001 shares in Hotung Enterprises Ltd (“HEL”) upon trust for Anthony and two of his brothers Michael and Sean and 1 share upon trust for Eric. Pursuant to another Declaration of Trust dated 6 February 1980 (the “HICL Trust”), Ho held as trustee 3 shares in Hotung Investment (China) Ltd (“HICL”) upon trust for Anthony and two of his brothers Michael and Sean. 6.For easy reference, I will refer these two trusts collectively as the “2 Trusts”. 7.In respect of the shareholding of HEL at the material time, Ho held 10,002 shares for the said parties pursuant to the HEL Trust. The other 10,002 shares were held by Hillhead Limited (“Hillhead”), which was a professional trustee company under the management of Ernest & Young, upon trust for Anthony’s sisters Mara, Gabrielle and Sheridan. HEL was dissolved in September 2014. 8.In respect of the shareholding of HICL at the material time, Ho held the 3 shares for the said beneficiaries pursuant to the HICL Trust, and Hillhead held 3 shares upon trust for Mara, Gabrielle and Sheridan. The remaining 90 shares were held by HEL. 9.Eric was the settlor of the 2 Trusts. He was at all material times a director of HEL and HICL. He was also a director of Hotung Estates and had a controlling beneficial interest in it. 10.According to Anthony, Eric was a man of strong and formidable character. He describes Eric as a “control freak”. As a father, Eric was a “tyrant” to his family and children, and his words were “commands” in the family. 11.There is no serious dispute that Anthony did not know about his interests in the 2 Trusts until about 2000. Anthony was born on 14 March 1966 and so he attained the age of 21 on 14 March 1987. 12.In 1989, Anthony returned to Hong Kong and worked in Eric’s flagship listed company Cosmopolitan International Holding Ltd (“Cosmopolitan”). He was also appointed as a director of HICL. He ceased to be a director of HICL in November 1995. 13.Despite his strong character, Eric and his sons used to have a good relationship. However, there was a dispute about the beneficial interest of a trust involving a property in MacDonnell Road (the “MacDonnell Road Property Trust”) in 1996 and the relationship between Eric and Anthony started to deteriorate ever since. Eventually, they settled their differences and Anthony discontinued the present claim against Eric and Hotung Estates in 2009. 14.Before that, Eric and his children were involved in a series of litigations. After Anthony learned of his interests under the 2 Trusts, he and some of his brothers took legal proceedings against Ho demanding the latter to execute a power of attorney empowering them to deal with the shares in HICL and HEL. In response to that, Eric took out legal proceedings to revoke the 2 Trusts on the ground that they were made subject to conditions (the “Revocation Proceedings”). The case (HCA 571/2003 and HCMP 2820 & 4511/2002) was tried before Tang JA (as he then was) in 2005. The learned judge ruled the case against Eric. 15.Anthony commenced the present proceedings against Ho, Eric and Hotung Estates on 6 June 2006 relating to certain irregularities in the management of HICL and breach of duty as trustee on the part of Ho. 16.Earlier in July 1991, HICL acquired certain plots of land in Kam Tsin, New Territories (“the Land”) for $7,440,000. In December 1998, HICL sold the Land to Hotung Estates for $17,500,000, giving a unit price of $143 per square foot. At the same time, Eric also sold to Hotung Estates several land plots registered in his personal name that were adjacent to the Land (“the Adjacent Lands”). In April 2000, the Land together with the Adjacent Lands (the “Amalgamated Lands”) were sold by Hotung Estates to one Base One Ltd (“Base One”) at $204,307,510, giving a unit price of $646 per square foot. 17.In a nutshell, Anthony claims that there were irregularities in these transactions, including that the sale of the Land to Hotung Estates should have included a premium to reflect the enhancement in value when amalgamated with the Adjacent Lands. Anthony also alleges that there were irregularities in the finance and management of HICL in the form of advances made to Eric and Hotung Estates and companies owned and controlled by Eric. It is claimed that these irregularities had potentially and adversely impacted on the value of the shares beneficially owned by Anthony. 18.For the claim against Ho, Anthony alleges that she was or reasonably should have been put on notice about these irregularities in the management of HICL. Further, Anthony alleges that Ho should have informed him of his interests in the 2 Trusts when he attained the age of majority in March 1987. In the Re-Amended Statement of Claim (“RASOC”), Anthony claims against Ho for, inter alia, equitable compensation and damages for breaches of duties as trustee and an order for an account to be taken of what is due by Ho under the 2 Trusts. 19.Anthony also claims for an order for the removal of Ho as the trustee for the 2 Trusts. In HCMP 641/2009, Ho applied to retire as trustee, but C Chu J (as she then was) postponed Ho’s application until the determination of her possible liability for breach of duty as trustee under the 2 Trusts. Eventually on 8 March 2012, Chung J made an order permitting Ho to retire, and hence removal of trustee is no longer an issue in the present case. In any event, Ho died in 2018. 20.The case was originally fixed for trial in October 2018. By reason of the death of Ho, DHCJ M Ng (as she then was), on 3 September 2018, made an order for the executor of the estate of Ho (the “Executor”) be substituted as the 1st Defendant in place of Ho. Anthony also applied for the adjournment of the trial and so the trial was refixed before me in November 2019. By reason of such development, I was not the judge hearing the PTR. 21.Mr Yin, counsel for the Executor, has informed the court that he does not seek to rely on Ho’s witness statement at the trial. Under such circumstances, Anthony is the only witness. 22.From the outset, I have had great difficulty with Anthony’s claim. The case was commenced long ago and the litigation has run out of steam throughout the years. I would say that only half-hearted attempt has been made by Anthony to pursue his claim at the trial. 23.I would summarise the problems of Anthony’s claim as follows:
24.I will deal with these issues in turn. The case as pleaded by Anthony 25.At the trial, Mr Alder has submitted to the court a revised quantum table and particulars to the RASOC (the “Table”), a copy of which is annexed to this Judgment. Unfortunately, a lot of the allegations included in the Table are new and have not been previously raised in pleading. 26.First, one has to examine Anthony’s case as pleaded. In §10 of the RASOC, Anthony has pleaded the duties owed by Ho as trustee. These are general allegations as to duties and not breaches. 27.As to what constitute breaches of duty, I can identify 3 alleged breaches:
28.There are some further general allegations made in §§48 to 49 of the RASOC:
29.The court can ignore §48 as the new allegations mentioned in the Table are not made under such paragraph. 30.In the Table, Mr Alder has classified the alleged breaches under 11 phases:
31.Phases 1 and 2 are not relevant as Anthony is not relying on any irregularities during such phases. From phase 3 onwards, apart from the allegation in support of the Undervalue Sale Claim, Mr Alder has listed out a lot of transactions which he says call for investigation. Some of these transactions occurred after the issue of the writ. For these post-writ transactions, they involve new causes of action which accrued after the issue of the writ. It is clear that Anthony should not be allowed to pursue these alleged post-writ breaches under the pretext of ongoing trustee’s duties. 32.For the other new allegations, Anthony should likewise not be allowed to pursue those claims as well, unless they fall within the Dubious Payments Claim, the Failure to Inform Claim or the Undervalue Sale Claim as pleaded. Anthony should not be permitted to add new allegations and ask Ho and the Executor to answer for them in the guise of provision of particulars. 33.First, it is clear that, according to the averments in the pleading, the Dubious Payments Claim only covers the pleaded transactions referred to in the 1997, 1998 and 1999 audited reports of HICL and nothing else. These claims also do not fall within §49, as it refers to failure on the part of Ho to produce information upon requests made by Anthony and effort made by Ho in thwarting Anthony from preserving the value of the assets and interests under the 2 Trusts. The new allegations relating to the other dubious transactions do not fall within this category. 34.In his submissions at the trial, Mr Alder also relies on the following unpleaded allegations:
35.Apart from the fact that these specific allegations have never been pleaded in the RASOC, some of the matters complained of relating to the “en bloc” issue only arose after the issue of the writ on 6 June 2006. In addition, though Mr Alder has sought to include these allegations in the Table in the guise of provision of particulars, no quantum has been claimed in the Table in respect of the alleged breaches of the duties mentioned in the preceding paragraph. 36.Indeed, the circumstances of the case do not justify Anthony in relying on these new allegations. I agree that Anthony did make some reference to these new allegations in his witness statement made on 19 April 2016. However, such witness statement was filed about 10 years after the commencement of the present proceedings. It was long after Anthony discontinued the claim against Eric and Hotung Estates in March 2009. There is also no serious dispute that Ho’s health had deteriorated over the years, and the delay in the prosecution of the claim had made it more difficult for Ho and the Executor to gather information to answer the allegations. In particular, Eric was the person who should have been in the best position to know about these transactions. Yet, Anthony discontinued the claim against him making him a disinterested party. Eric and Ho also died before the trial. Under such circumstances, it would be grossly unfair to Ho and the Executor if they had to deal with these new allegations which were made years after the commencement of the claim. With such history of the case, Anthony’s claim should be strictly restricted to the allegations pleaded in the RASOC and he should not be allowed to expand the claim by the new materials included in his witness statements and the Table. 37.For these reasons, the court only needs to focus on the Failure to Inform Claim, the Dubious Payments Claim and the Undervalue Sale Claim as pleaded. Insufficient materials to conclude that the alleged dubious transactions were improper 38.In the case of the Dubious Payments Claim, it is the duty on the part of Anthony to prove that the transactions concerned were indeed improper and the quantum of the related losses. At the very least, he should put enough materials before the court to call for an explanation or account on the part of Ho. 39.For the few payments and advances included in the Dubious Payments Claim, Anthony raises queries as to why a certain payment had been made to a director, and why HICL made certain advances to related companies without securities or repayment terms. Anthony is not able to supply any particulars as to the background of these payment and advances, or whether these advances had been repaid or not. More importantly, Anthony has not engaged a forensic accountant, or indeed any accountant, to examine the accounts of HICL at the material time. In fact, the accounting documents of HICL show that HICL owed various sums of money to its director (presumably Eric) from time to time. Without knowing how these liabilities, payment and advances were being booked in HICL’s accounts, it is simply impossible for the court to conclude that there was anything wrong with these payment or advances. Hence, there are insufficient materials before the court to substantiate the Dubious Payments Claim. 40.I agree that there are occasions when the court, in an equity claim, would expect the trustee to explain and to account for their wrongs, in particular when the lack of supporting materials is caused by the fault of the trustee. In such circumstances, if the trustee cannot offer the explanation or supply the relevant documents, the court may draw adverse inferences against the trustee and order him or her to pay equitable compensation arising from the breach of duty as trustee. 41.In Libertarian Investments v Hall[1], Lord Millet NPJ, said the following:
42.But in my judgment, the claimant should at least discharge the duty to establish a prima facie case calling for the trustee to account. If the claimant has not done so, the claim cannot even begin to get off the ground. 43.For example, a shareholder of a big listed company may raise all sorts of queries relating to why certain payments were made by the company. However, without studying the full accounts and the relevant available documents, that shareholder cannot simply lodge a claim against the director of the company asking him to account and to pay equitable compensation. 44.The position of Ho was even more remote. She was just the shareholder and not director of HICL at the material times. She, as the trustee of the 2 Trusts, was not even the majority shareholder of HICL or HEL. Due to Eric’s character as further elaborated in the latter part of this Judgment, Ho might have had to take legal proceedings against HICL or Eric if she sought to obtain the relevant information about the alleged dubious transactions. In fact, Anthony claims that there were such dubious transactions in phase 4 when he was a director of HICL. If he cannot obtain more information about these transactions, how can he expect Ho to do so? Hence, under the peculiar circumstances of the present case, the court should be slow in drawing any adverse inferences against Ho for the absence of explanations about these alleged dubious payment or advances. In particular, such task would be quite impossible after so many years, and Anthony himself should bear great responsibility for the delay in the prosecution of the claim. 45.Due to the lack of such supporting materials, the Dubious Payments Claim must fail. 46.In fact, the same observations can be made about the other new unpleaded allegations falling outside the Dubious Payments Claim. I do not propose to address each new unpleaded transaction one by one, but I can give my observations about some of them:
47.For these reasons, even if Anthony is allowed to rely on the new allegations contained in the Table, it does not take his case any further. Insufficient materials to conclude that the sale of the Land was made undervalue 48.This is a straightforward point. Anthony has not produced any valuation evidence on the market value of the Land at the material time in 1998 taking into account the alleged premium associated with the possible amalgamation of the Land with the Adjacent Lands. Anthony should not have any difficulty in obtaining such kind of valuation evidence. Without such crucial material, it is simply impossible for the court to conclude that the sale of the Land to Hotung Estates in 1998 was made undervalue. 49.Anthony pleads that one Metrobase Ltd (“Metobase”) had made an offer to purchase the yet-to-be amalgamated lands shortly prior to the sale of the Land in 1998. However, that was only an offer to purchase the Amalgamated Lands, not the value of the Land itself taking into account the possible premium. Obviously, the market value of the Land at the time of the sale in 1998 depends on a number of other factors, such as the position of the Land in relation to the whole Amalgamated Lands and whether there were any conditions in the land lease restricting the use of the Land, which may have to be considered by an experienced and qualified valuation expert. One cannot simply look at the unit price for the sale of the Amalgamated Lands and deduce that the selling price of the Land was undervalue. 50.Further, there was a valuation report made by C Y Leung & Co Ltd dated 22 December 1998 showing that the open market value of the Land as at 30 November 1998 was the same $17,500,000. Without adducing any contrary expert evidence, there is simply no room for the court to conclude that the sale of the Land was made undervalue. As mentioned above, one cannot simply look at the offer price made by Metrobase before the sale and the ultimate selling price of the Amalgamated Lands and say that there should be a premium on the sale of the Land. After all, the Adjacent Lands were not owned by HICL. Even if there should have been a premium, Anthony has not adduced any expert evidence to show the quantum of such premium. Under such circumstances, Anthony has simply failed to discharge the burden of proving any equitable compensation against Ho for any undervalue sale of the Land. 51.For myself, I cannot understand why Anthony has not even obtained such basic material to substantiate the Undervalue Sale Claim, which Mr Alder agrees is Anthony’s main claim. That is why I remark that Anthony has only made a half-hearted attempt to pursue his claim after so many years. 52.In his final submissions, Mr Alder submits that there is some indication in the financial statements that the consideration for the sale of the Land had not been paid. Again, this allegation has never been pleaded and Anthony should not be allowed to run the case in whatever way he likes. Inability to prove the damages or causation for such damages 53.There is no dispute that Ho had not informed Anthony of his interests in the 2 Trusts after he attained the age of 21. Generally, a trustee should inform a minor beneficiary of his or her interest in a trust after such beneficiary attains the age of majority. However, the present case is unique in the sense that the 2 Trusts involved a gift to the children of the settlor. Eric, the settlor, rightly or wrongly, took the view that the 2 Trusts were made with conditions and as a result the 2 Trusts were revocable. His stance turned out to be incorrect after the judgment handed down by Tang JA in the Revocation Proceedings. Yet, taking into account the relationship between Eric and Ho, she could have been influenced by Eric and genuinely took the view that the 2 Trusts were revocable, and as a result she considered that she was not obliged to inform Anthony of his interests in the 2 Trusts. 54.For the purpose of the present case, following the adjudication of the claim in the Revocation Proceedings, I am prepared to find that there was a duty of the part of Ho to inform Anthony of his interests in the 2 Trusts when he reached the age of 21 on 14 March 1987. As she had failed to do so, she continued to owe the same duty to Anthony to protect his interests in the shares of HICL and HEL. It is also arguable that Anthony may claim damages against Ho for the possible loss of opportunity of him taking over the role of protecting his own beneficial interests in the shares of HEL and HICL had he known about his interests in the 2 Trusts earlier. 55.In determining the question of equitable compensation against Ho for the breach of such duty, the court has to consider the scenario as to what would have happened if Ho had informed Anthony of his interests in 1987, and what Ho should have done to protect Anthony’s interests in the shares. 56.On the first issue, I find that the circumstances would not have been very different even if Ho had informed Anthony of his interests in 1987. According to Anthony, Eric had a strong and formidable character. Eric was a “control freak” and his words were “commands” in the family. Eric was a “tyrant” to his family and children, and Anthony was afraid of confronting his father. It is also common ground that Eric was in de facto control of the boards of HICL and HEL when all the alleged dubious transfers and transactions took place. In fact, Anthony’s testimony confirms that Eric was the one in control of HEL and HICL at all material times. 57.Under such circumstances, I do not think that Anthony would have confronted his father at least before 1996. By that time, he was still young. Further, Anthony admits that Eric would not have allowed his children to interfere with his running of the business, and in the case of any legal proceedings taken by his children against him, Eric would have contested the claims all the way to the end. When Anthony was still young and lacked the financial resources to finance any litigations, and that Eric was the one in de facto control of the bulk of the family wealth, Anthony would probably have allowed Eric to run HICL and HEL even if he was aware of his interests in the 2 Trusts. 58.The situation might have been different after 1996. Eric might have confronted his father after their dispute over the MacDonnell Road Property Trust. Assuming that Anthony knew about his interests in the 2 Trusts and asserted his right in the shares of HICL and HEL, Eric would probably have taken the same course in commencing legal proceedings to revoke the 2 Trusts. The proceedings would have taken probably 3 years to complete (as it was in the case of the Revocation Proceedings), and the alleged payment and advances referred to in the Dubious Payments Claim and the sale of the Land in 1998 would still have been made. 59.In fact, Anthony was afraid of confronting Eric after he was aware of his interests in the 2 Trusts. As admitted by Anthony himself, if Anthony were to ask for the transfer of the shares to him, he knew that Eric would probably have relied on the articles of association of HEL and HICL to obstruct the transfer as any such transfer would have to be approved by the boards. In fact, after he knew of his interests in the shares, instead of asking Eric for such approval, he went after Ho demanding her to execute a power of attorney empowering him to deal with the shares. Anthony targeted Ho and not Eric. This clearly demonstrates that Anthony would have been very reluctant to confront Eric directly, and this would have been the case even if he was aware of his interests in the 2 Trusts earlier. 60.Taking into account his interests in the 2 Trusts, Anthony is the beneficial owner of about 1/6 of the shares of HICL. According to Mr Alder, if Anthony knew about his interests earlier, he would probably have liaised with his siblings and they would probably have taken some concerted actions to prevent Eric from running HICL any longer. If such were to occur, Eric would not have sit back and did nothing. He probably would have taken out legal proceedings against the children, and this would not have prevented the making of the alleged dubious payment or advances or the sale of the Land in 1998. Furthermore, no other persons in the family have joined in the present claim to sue Ho for breach of trust. So far as I know, Michael was indifferent to the present dispute, and so I am not sure whether the early notification of Anthony’s interests would have made a difference. In particular, the likelihood of the siblings acting together in bringing effective concerted actions was in doubt. 61.I also have to consider the issue as to what Ho could have and should have done to protect the interests of Anthony. First, I doubt whether there was anything that should have alerted Ho to take action to protect Anthony’s interests. So far as the sale of the Land is concerned, the selling price was supported by an apparent credible valuation report. Even assuming that there was something dubious which called for investigation, Eric probably would not have allowed Ho to interfere with his running of HICL, and as a result Ho would have had to resort to legal proceedings to carry on with the investigation. There is no dispute that Ho had obtained no money or remuneration from the 2 Trusts, and so one should not expect Ho to have used her own financial resources to finance the possible legal proceedings. It is also worth noting that when Ho’s solicitors, in March 2009, requested Anthony to provide a modest sum of $100,000 as costs on account for Ho to make the necessary applications as trustee following the judgment of the Court of Appeal on 10 July 2007, Anthony did not comply with the request. Hence, there was very little Ho could have done in the circumstances. 62.Another problem with Anthony’s claim is that he has failed to particularise in the pleading as to what exactly that he says should have and could have been done by Ho to protect Anthony’s beneficial interests in the shares of HEL and HICL. Without these particulars, Mr Alder has seen it fit to develop Anthony’s case in whatever way he likes. Very vague allegations have been made as to what Ho could have done in the circumstances, but it would be grossly unfair that the Executor has to now deal with these vague and new allegations raised about 13 years after the commencement of the claim. Anthony has also failed to provide more evidence, says oral testimony from his siblings, to substantiate what would have happened if Anthony knew of his interests earlier. Neither has he produced sufficient evidence to substantiate the possible losses from the Dubious Payments Claim and the Undervalue Sale Claim. Under such circumstances, even if Ho was in breach of her duty in failing to inform Anthony of his interests in the 2 Trusts after he attained the age of 21, he has failed to prove any damages caused by such breach of duty. 63.In the cross-examination of Anthony, Mr Yin put it to him that he had chosen to target Ho instead of Eric because the former was an easier and vulnerable target, whereas Eric was a strong and difficult person to deal with. There is certainly some truth in such observation. Though Ho was the trustee, Anthony expects her to have done certain things that even he would not have dared to do against his father. In my judgment, it would be inequitable to order Ho to pay compensation in these circumstances. 64.Based on my ruling above, I do not find it necessary to deal with the reflective loss argument put forward by Mr Yin. If I have to make a determination on such issue, I do not think that the principle of reflective loss is applicable here. 65.As I have mentioned above, for the Failure to Inform Claim, what Anthony is actually claiming is the damages arising from the loss of opportunity of Anthony taking over the role of protecting his own interests in the shares of HEL and HICL. That is quite different from the mere depreciation in the value of the shares of HICL and HEL caused by the alleged irregularities in their management. The two losses may not be the same. Hence, this is not a case involving reflective loss. 2 applications made by Anthony at the trial 66.I also explain here the reasons as to why I refused the following 2 applications made by Anthony at the trial:
67.The New Evidence Application was made shortly before the commencement of the trial. In my judgment, allowing Anthony to adduce new evidence at such a late stage in the proceedings would cause serious prejudice to Ho’s case which cannot be compensated by an appropriate award of costs. 68.The present proceedings were commenced in 2006. The witness statements were filed in 2015 and 2016. Eric’s 2016 Affidavit was sworn on 31 May 2016, but Anthony had not informed Ho or the Executor that he would rely on such new evidence until shortly before the trial. No satisfactory explanation has been given for such delay. Ho died in June 2018. If Anthony had made the New Evidence Application earlier, Ho could have dealt with the new evidence by way of filing of witness statement in reply. Now that Ho has died, the delay has caused prejudice to Ho’s case which cannot be compensated by an appropriate award of costs. 69.There is an issue as to whether Ho would have had the mental capacity to file witness statement in reply even if Anthony had made the New Evidence Application before her death. In my judgment, this is a non-point. Due to the lateness of the New Evidence Application, the court is deprived of the opportunity to investigate whether Ho would have had the mental capacity to make the witness statement in reply. Furthermore, the Executor and those assisting Ho in the conduct of the case would have been in a better position to find rebuttal evidence if Ho was alive at the time. Hence, the delay has caused serious prejudice to the preparation of the defence case. 70.In my judgment, it was quite legitimate for Ho and the Executor to rely on the scarcity of the evidence and the inadequacy of the RASOC in conducting the defence in the way they had. If Anthony’s case had been presented differently, Ho and the Executors could also have responded differently, for example, they might have taken out an application to strike out Anthony’s claim for want of prosecution. Hence, the court should not allow Anthony to present a different case after such a long period of time. 71.There is no dispute that Anthony cannot rely on §8 of the order made by L Chan J on 23 October 2018 to justify the filing of Eric’s 2016 Affidavit. That order was made for the purpose of allowing Anthony to file rebuttal evidence following the application by the Executor to adduce Ho’s witness statement by way of hearsay evidence following her death. Since Eric’s 2016 Affidavit does not fall within such kind of rebuttal evidence and Mr Yin is not seeking to rely on Ho’s witness statement as hearsay evidence at the trial, § 8 of the said order cannot assist Anthony’s application. For these reasons, I refused the New Evidence Application. 72.The Amendment Application was made even much later. Throughout the trial, Anthony has faced the problem of inadequacy of pleading. In a desperate attempt to salvage Anthony’s case, Mr Alder made the Amendment Application after the close of evidence at the trial. 73.One of the main proposed amendments is that Anthony seeks to include some of the new allegations in the Table in a new schedule annexed to the Statement of Claim. 74.As discussed above, the proposed amendments, even if allowed, cannot take Anthony’s case any further. But as a matter of principle, the Amendment Application should not be allowed as it would be grossly unfair to the Executor if he has to deal with these new allegations now. I have already given the reasons for such unfairness and I do not want to repeat the same here. Indeed, the whole conduct of the defence case might have been different if Anthony’s case had been presented differently. Furthermore, Mr Alder had been alerted about the pleading issue at the commencement of the trial, and there is no reason why the Amendment Application was only made after the close of evidence. The Amendment Application has absolutely no merit. Relief 75.What relief should be granted in view of these findings? In my judgment, it is true that Ho had breached her duty as trustee in failing to inform Anthony of his interests in the 2 Trusts when he attained the age of 21 on 14 March 1987. However, as Anthony cannot prove any damages resulting from such breach of duty, I only award $1 as nominal damage. I do not see the need to grant other relief such as declaratory relief in the present case. I also make a costs order nisi that the costs of the action be to the 1st Defendant which shall be made absolute 14 days after the date of the handing down of this Judgment.
Mr Edward Alder, instructed by Oldham Li & Nie, for the Plaintiff Mr Michael Yin, instructed by C K Mok & Co, for the 1st Defendant ANNEX – REVISED QUANTUM TABLE / PARTICULARS TO ASoC §11, §21, §25, §29, §31, §42(c), §45, §49
Total of funds removed from HICL. P’s claim @ 1/6th or 16.667% of: HK$1,046,398,036 1/6th or 16.667% of HK$1,046,398,036 = HK$174,399,673 [1] (2013) 16 HKCFAR 681, at §174 [2] the accounts of HICL show that it owed money to its director Eric from time to time [3] Losses 52, 53 and 54 come from a ledger spanning a long period of time. Some of the losses occur in the earlier phases. They are shown as 2007 losses for totalling up purposes. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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