Chan Kui Hai, The Sole Executor of the Estate of Chan Shing Cheung, Deceased v. Chan Kui Keung and Others

HCA 49/2018

[2022] HKCFI 2642

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 49 OF 2018

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BETWEEN

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Before: Hon Au-Yeung J in Chambers

Dates of Hearing: 29 July 2022

Date of Decision: 25 August 2022

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D E C I S I O N

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1.This is an application by the Plaintiff for leave to file and serve a 2^nd Supplemental List of Documents. It concerns 2 classes of documents that have come into existence since filing of the previous lists of documents, being (i) updated “Estate Accounts” and (ii) monthly bank statements in the name of the Plaintiff in which money of the estates was deposited. The Defendants only oppose the grant of leave as regards class (i).

2.The Plaintiff and the Defendants are brothers. Their Mother (Madam Wong Lai Ying) passed away in 2010 and their Father (Mr Chan Shing Cheung) in 2014. This action concerns both estates, of which the Plaintiff is the executor.

3.Upon the passing of the Mother, the Father became the sole owner of a shop by way of survivorship. The Plaintiff claims that the Defendants have been in wrong occupation of the shop since the death of the Mother. The Plaintiff seeks recovery of possession and mesne profits.

4.The Defendants deny wrongful occupation. They say that, after the Father’s retirement in 1993, they have continued to carry on the business at the shop with the approval of the Father and the Mother. The Mother has given the Defendants an irrevocable licence for life to use the shop.

5.The Defendants have a counterclaim. They say that the Plaintiff himself has placed personal belongings at the shop and must account for 20% of the rent. They also aver that the Plaintiff has breached his duties as executor and failed to lease out and account for the rental of a workshop and a flat from the estate of the Father. The Plaintiff breached his duty in failing to give an account of the Father’s estate and to distribute the estate. He also misappropriated assets in the Mother’s estate.

6.The Plaintiff denies the counterclaim and says that the licence was revoked upon death of the Mother and/or the Father. He denies placing stock in the shop and claims that any counterclaim for rent is time-barred. Upon obtaining the grant of probate to the Father’s estate, the Plaintiff had sold a workshop and a flat. The Plaintiff used money in the Mother’s bank accounts to pay for her testamentary and funeral expenses, debts and to look after the Father. After the death of the Mother, money was used from the Mother’s estate to purchase the columbarium and the Plaintiff had accounted for the same.

7.The estate accounts to be produced concern the estates of both the Mother and the Father and are both made up to 31 May 2020. They are said to update expenses of the estates.

8.At this hearing, Mr Wong, counsel for the Defendants, submits that class (i) does not relate to any matter in issue in this action. The counterclaim relates to failure of the Plaintiff to distribute the estate, failure to give an account and misappropriation of the Mother’s estate. They all related to conduct of the Plaintiff before the claim from 2010-2018. The writ was issued in 2018. The estate accounts for the Mother for 2010-2017 and those for the Father for 2014-2017 have been filed. Any updates after those estate accounts are irrelevant.

9.This issue of discovery was raised at the PTR. The Defendants say that the Plaintiff withdrew the application upon their objection. The Plaintiff says that the hearing just overrun and the judge was not in a position to hear them. I am unable to rule on it without the transcript.

10.The PTR bundle was made available to this Court only after the hearing. Upon considering the pleadings and the documents in the PTR bundle, I am of the view that leave should be granted to the Plaintiff. Class (i) do relate to the matters in issue in the Peruvian Guano sense. One of the issues is misappropriation of the Mother’s money and the Plaintiff’s failure to account as an executor. The updated accounts concern expenses funded by money from the Mother’s estate and may be material to the Plaintiff’s defence to the alleged misappropriation. The audited accounts of both estates may also assist the Court in the exercise of its discretion on whether to order accounts to be provided. The actual relevance of the information in those accounts should be dealt with at the trial.

11.I therefore give leave to the Plaintiff to file and serve a 2^nd Supplemental List of Documents with regard to the 2 classes of documents set out in paragraph 1 above within 7 days from the handing down of this decision.

12.On costs, the Defendants have changed their stance. By a letter dated 15 July 2022, the Defendants’ solicitors agreed to the draft estate accounts but they later objected to the accounts being in auditted and finalized form, despite confirmation from the Plaintiff’s solicitors that the auditted version is the same as the draft one. I fail to see how an auditted version could cause prejudice to the Defendants.

13.I do not find the change in stance of the Defendants to be reasonable. This Summons could have been dealt with by consent summons without a hearing. The costs spent on the hearing with counsel on their side is totally disproportionate to the issue at stake. On a nisi basis, I make an order for the Summons to be costs in the cause, but the half hour hearing (assessed at $2,900) to be the Plaintiff’s costs in the cause.

Mr Peter K.P. Cheung, of Herman H.M. Hui & Co., for the Plaintiff

Mr Tim Wong, instructed by Gloria Chan & Co., for the 1^st to 3^rd Defendants