Cheung Wai Ling Vicki v. Cheung Oi Ling Aileen (in Her Capacity As Administratrix of the Estate of Cheung Choy Chiu Ki Ruby Aka Ruby K. Cheung, Cheung Choy Chiu Ki, Cheung Choy Ruby Chiu Ki, Cheung Ruby K, Cheung Ruby and Cheung Ruby Kay Deceased

HCMP 202/2020
HCMP 563/2022

[2023] HKCFI 2819

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 202 OF 2020

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And

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 563 OF 2022

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(Heard Together)

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J U D G M E N T

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A.  INTRODUCTION

1.This is the substantive hearing of the Amended Originating Summons in HCMP 563/2022, and the question of costs in HCMP 202/2020. The plaintiff in these two sets of proceedings is Madam Cheung Wai Ling Vicki (“Vicki”), who is one of the beneficiaries of the estate (“the Estate”) of the late Madam Cheung Choy Chiu Ki Ruby (“the Deceased”). Upon Vicki’s request and after consideration, I directed that the Amended Originating Summons in HCMP 563/2022 and the question of costs in HCMP 202/2020 be heard together.

2.The Deceased passed away intestate on 29 June 2018. The Deceased’s 6 children are the beneficiaries of the Estate (all of them are not living in Hong Kong), who are as follows:

(1)  Mr Cheung Chi Hung Douglas (“Douglas”)

(2)  Madam Cheung Yuen Ling Rosalind (“Rosalind”)

(3)  Vicki

(4)  Madam Cheung Man Ling (“Madeleine”)

(5)  Madam Cheung Oi Ling Aileen (“Aileen”, the current administratrix of the Estate)

(6)  Mr Cheung Chi Gar Patrick (“Patrick”)

3.In HCMP 202/2020, Vicki seeks, inter alia, an order against Aileen to require Aileen as the administratrix of the Estate to render a true and perfect inventory and account of the Estate. In HCMP 202/2020, Aileen was represented by Lo, Wong & Tsui (“LWT”) around June 2022. Thereafter, Aileen was unrepresented in the case. Having considered the evidence as to service adduced by Vicki, I am satisfied that notice of this hearing has been duly served on Aileen, and Aileen has been made aware of the direction that substantive submissions on the question of costs in the case would be heard in this hearing.

4.In HCMP 563/2022, Vicki applies for, inter alia, an order for removing Aileen as the administratrix of the Estate and appointing Mr So Man Chun (“Mr So”) and Mr Chin Choon Onn (“Mr Chin”) of PricewaterhouseCoopers Limited (“PwC”) as the administrators of the Estate (“the Proposed New Administrators”) in her place. Aileen, and all the other beneficiaries of the Estate (ie Douglas, Rosalind, Madeleine, and Patrick) are named as defendants in this set of proceedings. All the defendants are not legally represented in this case. Having considered the evidence as to service adduced by Vicki, I am satisfied that the Concurrent Amended Originating Summons and the supporting affirmations, as well as notice of this hearing, have been duly served on all the defendants. None of the defendants has acknowledged service of the proceedings. No defendant has ever filed any affidavit or affirmation in the proceedings.

5.In this hearing, Vicki is represented by Mr Kenny Lin of counsel. Aileen, who is the defendant in HCMP 202/2020 and the 1^st defendant in HCMP 563/2022, is absent. All the other defendants in HCMP 563/2022 are also absent. Since the two sets of proceedings are related to each other, at the beginning of the hearing, I directed that the evidence filed in one set of proceedings be deemed as evidence in the other set of proceedings.

B.  THE FACTS

6.Based upon the evidence before the court, the undisputed facts are as follows.

7.After the death of the Deceased on 29 June 2018, all the beneficiaries agreed that Aileen to be the administratrix of the Estate. They also agreed to retain LWT as the solicitors to assist Aileen in seeking the Letters of Administration from the court.

8.On 16 April 2019, Letters of Administration of the Estate (“the Grant”) was issued.

9.Vicki noticed that a number of the Deceased’s assets were omitted from the Schedule of Assets and Liabilities (“the Schedule”) annexed to the Grant. At the time, Vicki thought that this might be due to the fact that the Deceased had many aliases under which different assets were held. Vicki understood that Aileen intended to file a corrective affirmation in respect of the assets missing in the Schedule. In the interest of expediency and with a view of offering Aileen’s assistance for the administration of the Estate, Vicki prepared a table showing assets held by the Deceased known to her. On 22 May 2019, Vicki’s solicitors, Myra Li & Co (“MLC”), wrote to LWT and informed them that Vicki would prepare the said table and also asked Aileen to provide a true and perfect inventory and account of the Estate.

10.On 26 May 2019, Aileen provided a brief progress report on her administration of the Estate and provided the same to all the beneficiaries except Vicki.

11.On 28 May 2019, MLC wrote to LWT, providing an excel spreadsheet listing the Deceased’s aliases, and numbers and names of stocks in the Estate known to Vicki. MLC repeated Vicki’s request for the inventory and account of the Estate.

12.On 13 June 2019, MLC received LWT’s letter with a cheque for HK$4,000,000, being an interim distribution from the Estate.

13.On 27 June 2019, MLC sent a letter to LWT commenting on Aileen’s proposed application for amendments to the Schedule. MLC further repeated the request for the inventory and account of the Estate from Aileen.

14.On 6 July 2019, Aileen provided a brief progress report of the administration of the Estate in the form of an email.

15.On 25 July 2019, MLC wrote to LWT for a reply to Vicki’s request for the inventory and account of the Estate.

16.On 29 August 2019, MLC repeated Vicki’s request for the inventory and account of the Estate.

17.On 31/8/2019, Aileen wrote an email to MLC, in which she said:

“…… I do not have time to entertain the repeated requests from you and your client. It is a waste of time. I am doing my best to get the estate settled, everyone will get their equal shares. Your client has been making all kind of demands prematurely. And at the end, if she still have doubts, she can do [whatever she deems fit]. ……

SO BACK OFF

……”

18.On 9 September 2019, Vicki reiterated her request for the inventory and account of the Estate.

19.On 13 September 2019, in her email to MLC, Aileen said:

“I have read the letter from Myra Li dated 9 September 2019.

The request was redundant and the stock ledger sheet been presented prior times.

I, as an appointed administrator do not have the time or energy to entertain one of the members who seems to have a lot of idle time in hand. When the estate of Ruby Cheung is completed, that member party can elect what she pleases.

……”

20.On 10 October 2019, MLC received LWT’s letter with a cheque for HK$4,000,000 being an “interim distribution of the proceeds from the sale of stocks held by the Deceased”, and a share certificate in the amount of 18,566 shares in HSBC Holdings plc.

21.On 22 November 2019, MLC received LWT’s letter with a cheque for HK$2,542,490.22 in Vicki’s favour. The cheque was said to be “distribution of the balance of the proceeds from the sale of property at Flat C, 5/D, Mountain View Court, 12 Conduit Road, Hong Kong”, and 2 HSBC Holdings plc share certificates in the amount of 139 shares and 2,963 shares.

22.On 4 January 2020, Aileen provided some information on the administration of the Estate by email.

23.On 10 March 2020, Vicki issued the Originating Summons in HCMP 202/2020.

24.On 13 March 2020, LWT wrote to MLC and said that Aileen “does not in principle oppose to providing a true and perfect inventory and account of the properties of the Estate”. LWT also said that if a more formal account (such as engaging professionals to prepare the same) was requested, they wanted to know whether Vicki would agree to bear the costs incurred in engaging professionals.

25.On 16 March 2020, MLC replied and stated that Vicki requested for a full and proper account and inventory of the Estate, which should be verified by the administratrix on oath and supported by documentary evidence. Vicki refused to bear the costs incurred in engaging professionals to prepare the said account and inventory. Vicki also said that she would seek an order to require Aileen to bear the costs of HCMP 202/2020 personally.

26.On 17 March 2020, LWT stated that Aileen intended to engage professionals to prepare a full and proper account and inventory of the Estate and asked Vicki to pay for “such costs involved”.

27.On 23 March 2020, MLC replied to LWT and said that there was no basis for the costs of the inventory and account of the Estate to be solely borne by Vicki.

28.After the commencement of HCMP 202/2020, Aileen provided the following accounts (“Aileen’s Accounts”) to Vicki:

(1)  On 2 April 2020, LWT provided a provisional account of the Estate to MLC.

(2)  On 29 May 2020, LWT provided a revised provisional account of the Estate to MLC.

(3)  By her Affirmation filed in HCMP 202/2020 on 14 October 2021, Aileen produced a report from Rod Ermel Associates concerning the Deceased’s 5 bank accounts in HSBC.

29.On 17 June 2021, in HCMP 202/2020, after hearing the parties, I made an order requiring, inter alia, that Aileen as the administratrix of the Estate do engage professional(s) as agreed between herself and Vicki or appointed by the court to assist Aileen in preparing a true and perfect inventory and account of the Estate. I also ordered that save and except costs of preparing the said inventory and account be paid out from the Estate in the first place, costs be reserved.

30.On 10 August 2021, by virtue of the order made by DHCJ Leung, Mr So and Mr Chin of PwC (nominated by Aileen) were appointed as the specified professionals to assist Aileen to prepare a true and perfect inventory and account of the Estate.

31.On 6 December 2021, the Inventory and Account Report prepared by PwC (“the Report”) was filed. According to the Report, the estimated worth of the Estate on the date of the death of the Deceased (ie on 29 June 2018) was around HK$163 million.

32.On 11 May 2022, Vicki issued the Originating Summons in HCMP 563/2022, seeking an order to remove D from the office of the administratrix of the Estate.

33.On 29 June 2022, LWT wrote to MLC and informed MLC, inter alia, that by a letter from Aileen to LWT dated 26 April 2022, Aileen had confirmed to LWT that she no longer intended to retain LWT. LWT had obtained an order from the court to cease to act for Aileen in HCMP 202/2020. LWT had no instruction to accept service on behalf of Aileen in HCMP 563/2022.

34.There have been some legal proceedings between Vicki and Aileen in Singapore concerning the administration of the Estate. On 28 September 2022, Aileen informed the Singapore Court that she would not be engaging any other solicitors in the Singapore proceedings after discharging the solicitors representing her in the proceedings.

C.  THE PRINCIPLES

C1.  Principles concerning appointment and removal of personal representative(s)

35.Probate and Administration Ordinance (“PAO”), s.33(3) provides:

“The court may, if satisfied that the due and proper administration of the estate and the interests of the persons beneficially entitled thereto so require, suspend or remove an executor or administrator (other than the Official Administrator) and provide for the succession of another person in place of such executor or administrator and for the vesting in that other person of any property belonging to the estate.”

36.Recently, the principles concerning the exercise of the powers under s.33(3) of the PAO have been summarized by Wilson Chan J in Chu Wing Chuen Paul v Chu Oi Yan Irene[1]. Those principles are as follows:

(1)  The discretion to remove an executor or an administrator under section 33 of the PAO involves an assessment and a value judgement in all the relevant circumstances of whether removal is required for the due and proper administration of the estate and the interests of the beneficiaries.

(2)  Not every mistake or neglect of duty, or inaccuracy of conduct of trustees would induce the court to remove the executor or the administrator.

(3)  The acts or omissions must be such as to endanger the trust property or to show a want of honesty, or want of proper capacity to execute the duties, or a want of reasonable fidelity.

(4)  Hostility between the executor/administrator and the beneficiary is not a ground for removal, unless the breakdown of the relations between them is such as to lead to the administration coming to a standstill, or makes it difficult or impossible for the administration to be completed by an existing personal representative.

(5)  In exercising its discretion, the court should have regard to the size of the estate, the nature of the assets that need to be administered, the background and education, training and experience of the remaining and substituted personal representatives and the interests of the beneficiaries. The view of the majority beneficiaries is a relevant factor.

(6)  The discretion to remove an executor or an administrator is to be exercised with great caution and sparingly. In general, removal is not to be preferred unless the administration is still far from completion. The courts are reluctant to exercise the discretion where the incumbent executor or administrator wishes to carry on, without allowing that incumbent an opportunity to repair or remedy any defects and progress promptly with due administration. The fact that administration of the estate could have been done better is not of itself sufficient ground.

C2.  Principles concerning the duty to render a full and proper account

37.In respect of requiring an administrator to render a full and proper account, the court has the jurisdiction to do so pursuant to s.56 of the PAO, which provides:

“The personal representative of a deceased person shall, when lawfully required so to do, exhibit, by affidavit filed in the court, a true and perfect inventory and account of the movable and immovable property of the deceased, and the court shall have power as heretofore to require personal representatives to bring in inventories.”

38.A personal representative, after a grant has been made to him, owes a duty to collect and get in the real and personal estate of the deceased, and to administer it according to the law. It is also the duty of the representative to keep and to render a proper account of the administration of the estate. In Tsang Wing Kwai v Tsang Wing Fai, Wilson Chan J said:[2]

“18. The duty of an executor to keep and render proper accounts is of paramount importance. Generally speaking, it is the duty of a personal representative, after a grant has been made to him, to collect and get in the real and personal estate of the deceased, and to administer it according to law. He must act with due diligence in the discharge of his duties: Williams, Mortimer and Sunnucks on Executors Administrators and Probate (20^th edn, 2013, paragraph 48-18).”

39.In Chow Chak Kiu v Chow Man Chi (HCMP 797/2016, 17 January 2017), Chow J (as he then was) said:

“40. Generally speaking, to render a proper account of the estate of a deceased person, the personal representative is required to: -

(1) show the opening balance (including capital assets) and closing balance;

(2) give details of movement of assets, incomes and expenditure of the estate;

(3) give details of the whereabouts of all properties (including cash) of the estate which the personal representative is duty bound to administer; and

(4) support the account with documentary evidence.

See Re Estate of Lee Da Kor [2010] 1 HKLRD 415, at paragraphs 17 and 26 per Jeremy Poon J (as he then was); Charles Yu Chiu Kwan v Edna Yu Chan Shek Yin, HCMP 965/1980 (22 April 1982) per Rhind J (quoted by B Chu J in Leung Wing Hong v Leung Yiu Cho, HCMP 1473/2014 (11 August 2016), at paragraph 104).

41. Moreover, it is not acceptable for the personal representative merely to give to the beneficiary a bundle of documents relating to the estate and leave it to the beneficiary to sort out the documents himself (Re Estate of Lee Da Kor, at paragraph 37).”

D.  REMOVAL APPLICATION

40.Mr Lin submits that Aileen ought to be removed from the office of administratrix of the Estate and be replaced by the Proposed New Administrators for the following conduct of Aileen:

(1)  Failure to discharge her duty of rendering a true and perfect inventory and account of the Estate

(2)  Breach of a court order and failure to provide documents to PwC.

(3)  Failure to distribute or withholding distributions to Vicki, who is one of the beneficiaries of the Estate, without justification

(4)  Failure to explain some dividends and expenses

(5)  Failure or refusal to rectify some transfer forms to transfer some HSBC shares to Vicki

(6)  Showing no interest to continue to administer the Estate

41.Having considered the evidence and the submissions, I am of the view that the matters relied upon by Mr Lin are proved.

D1.1  Failure to render a true and perfect inventory and account of the Estate

42.It is indisputable that the Estate is very substantial. Since the grant of the Letters of Administration, Vicki has repeatedly requested Aileen to provide a true and perfect account of the Estate.

43.Notwithstanding the repeated requests from Vicki, before the commencement of HCMP 202/2020, the only accounts provided by Aileen to Vicki are (a) the report in the 6 July 2019 email, and (b) the report in the 4 January 2020 email. As submitted by Mr Lin, the reports in these two emails clearly could not satisfy the requirements in the Chow Chak Kiu case. Further, these two reports in fact have led to more questions:

(1)  There are various unexplained discrepancies relating to balances of cash at bank between the 6 July 2019 email and those set out in Section 2 of the Schedule.

(2)  These two emails show that the balance held in the bank account was reduced from HK$2,086,322 (as of 6 July 2019) to HK$1,790,221 (as of 4 January 2020), but there is no explanation as to this reduction.

(3)  As recorded in 6 July 2019 email, the cash left in the Estate Account after the interim cash distribution of HK$24,000,000.00 made on 13 June 2019 was HK$5,433,496.16 (not counting the “Wing Hang Investment” of $1,000,000.00). In Aileen’s email sent on 4 January 2020, the cash balance in the Estate Account plus “OCBC cash of HK$1,790,221” came to HK$5,341,559. There is a discrepancy of some HK$91,000 which is not accounted for.

(4)  There are some significant expenses incurred by Aileen without any particulars or explanation.

44.Concerning Aileen’s Accounts provided to Vicki after the commencement of HCMP 202/2020, Mr Lin submits that those accounts also could not satisfy the requirements in the Chow Chak Kiu case. Mr Lin has set out the deficiencies in those accounts in [60] of his written submissions dated 24 October 2023 (“P’s WS”). I am not proposed to set out all the observations made by Mr Lin in this judgment. Suffice for me to say that after examining the documents, I accept Mr Lin’s submissions and hold that these accounts do not satisfy the Chow Chak Kiu requirements as submitted by Mr Lin.

45.In her 3^rd Affirmation filed in HCMP 202/2020, Aileen claimed that in respect of the deficiencies in Aileen’s Accounts, the answers could be found in various documents provided by her. With respect, as said by Chow J (as he then was) at [41] in Chow Chak Kiu, this is not acceptable. Further, in any event, I agree with Mr Lin that for the deficiencies identified in [64] and [65] of P’s WS and the table annexed thereto, the contents of Aileen’s 3^rd Affirmation do not constitute a good and sufficient answer to the complaint of failure to render true and perfect inventory account of the Estate.

46.In my judgment, Aileen has failed to render a true and perfect inventory and account of the Estate to Vicki, who is one of the beneficiaries of the Estate.

D1.2  Breach of a court order and failure to provide documents to PwC

47.Mr Lin submits that Aileen has breached [6] of the order dated 17 June 2021, which is as follows:

“[Aileen] shall provide to [PwC] as soon as reasonably practicable all the documents and information relating to the Estate within her possession, custody, power and/or control and such other documents and information as may reasonably be required by [PwC] for the purpose of preparing the Inventory and Account.”

48.In the Report, PwC said:

“2.1 This Report is prepared based strictly and primarily on the information and documents provided by the Administratrix and/or her lawyers, [LWT]m as set out in Appendix A. …… While we have been provided with volumes of documents for the purpose of preparing this Report, certain information and documents have not been available by the time of issuance of this Report. In this regard, we understand that LWT has been making enquiries with the relevant parties for such information to the extent possible to be provided for review.” (Emphasis added)

49.In Appendix A to the Report, PwC mentioned that some specific documents were outstanding, including some bank statements.

50.On 28 March 2022, MLC wrote to LWT (“the MLC’s Letter”). In that letter, MLC raised, inter alia, the matters set out in [47] to [49] above. On 29 March 2022, LWT replied and said that “[w]e are attempting to liaise with our client to take instructions with respect to the allegations raised in your letter …” Thereafter, no substantive reply to MLC’s letter dated 28 March 2022 has been given by LWT or by Aileen.

51.Being the administratrix of the Estate, the outstanding documents identified in the Report are documents within Aileen’s possession, custody, power and/or control. Up to now, there is no explanation from Aileen as to why the outstanding documents identified in the Report are not provided to PwC.

52.In the circumstances, based upon the evidence before me, I hold that Aileen has breached [6] of the order dated 17 June 2021 by failing to provide the outstanding information and documents to PwC.

D1.3  Failure to distribute or withholding distributions to Vicki

53.At [3] and [5.6] of the Report, PwC stated that the Estate owes Vicki HK$6,409,681.51, which are distributions payable to Vicki.

54.In the light of the findings made by PwC, Aileen has failed and/or refused to distribute the sum of HK$6,409,681.51 to Vicki. In the MLC’s Letter, this matter was raised. As mentioned in the above, there has not been any substantive reply on this matter from Aileen. There is also no affirmation filed by Aileen addressing this point.

55.Based upon the evidence before me, I find that Aileen has failed to perform her administratrix’s duty by not distributing the aforesaid to Vicki, or by withholding the sum from Vicki.

56.In [5.6.3] of the Report, PwC mentioned that there were a 7^th distribution from the Estate on 19 January 2021 and an 8^th distribution from the Estate on 9 September 2021. Vicki said that she had not been notified by Aileen of these distributions and had not received these distributions. This is also a matter raised in the MLC’s Letter. Again, there has not been any substantive reply on this matter from Aileen, and there is no affirmation filed by Aileen dealing with this matter. In the circumstances, I find that Vicki’ complaint is true. This point further reinforces the conclusion that Aileen has failed to perform her administratrix’s duty by failing to distribute certain sums to Vicki or withholding the sums from Vicki.

57.As to why Aileen would fail to or refuse to distribute the aforesaid sums to Vicki, Mr Lin submits that these were done by Aileen out of spite and/or in retaliation. Since Vicki is having litigation with her, Aileen has withheld these payments from them.

58.With respect to Mr Lin, the reason suggested by Mr Lin may or may not be the true reason. Although Aileen has failed to distribute certain sums to Vicki, it is a fact that Aileen did not withhold all the payments but in fact has made some distributions to Vicki. However, regardless of what is the real reason behind, it is an undeniable fact that Aileen has failed to make distributions and has withheld some distributions from Vicki. This is a breach of the administratrix’s duty.

D1.4  Failure to explain some dividends and expenses

59.At [5.3.2 (a)] of the Report, PwC said that LWT had been making enquiries with the Hong Kong Securities Clearing Company Limited for the breakdown of dividends and interest received in respect of various Hong Kong listed shares belonging to the Estate. However, up to now, Aileen has failed to disclose the outcome of the enquiries.

60.At [5.9] of the Report, PwC stated that expenses incurred by Aileen in the amount of HK$420,671.28, of which only HK$111,248.38 was supported by receipts or invoices. PwC also stated at [5.9.2] that Aileen claimed that she had paid the elevator replacement cost in respect of the property in Tai Hang totaling HK$117,836 out of her personal account or the Estate’s account. However, PwC could not find any documentary records for the alleged payment out of the Estate’s account or reimbursement of the said expense to Aileen.

61.These matters have also been raised in the MLC’s Letter. Up to now, these matters remain unexplained.

D1.5  Failing or refusing to rectify transfer forms to transfer some HSBC shares to Vicki

62.Aileen has refused to make corrections to certain HSBC share certificates and sign the “Standard Forms of Transfer” so that the 4 original HSBC Holdings Plc share certificates in the amounts of 18,566 shares, 139 shares, 2,963 shares and 164 shares to which Vicki is entitled under the Estate can be duly transferred to her account. There is no explanation from Aileen on this matter.

D1.6  Showing no interest to continue to administer the Estate

63.I agree with Mr Lin that Aileen has shown no interest to continue to administer the Estate:

(1)  While PwC were preparing the Report, Aileen had failed to provide the necessary information and documents requested by PwC, notwithstanding that Aileen was required to do so under the order made by this court on 17 June 2021.

(2)  Aileen did not even give any substantive reply to the matters raised in the MLC’s Letter.

(3)  Aileen chose not to continue to retain any lawyer to represent her in HCMP 202/2020. Since terminating the retainer of LWT, Aileen did not take any step in HCMP 202/2020. Aileen also has not taken any step in HCMP 563/2020.

(4)  There is no evidence showing that after terminating the retainer of LWT in HCMP 202/2020, Aileen has taken any further step to administer the Estate.

64.I would also add that facing Vicki’s application for an order removing her from the office of the administratrix of the Estate in HCMP 563/2022, Aileen has not filed any affirmation in opposition. This also shows that Aileen has no intention to continue to be the administratrix of the Estate.

D2.  Discussion

65.In considering whether Aileen should be removed from the office of the administratrix of the Estate, I bear in mind the principles summarized in the Chu Wing Chuen Paul case as set out in [36] above. I have also taken into account the following:

(1)  To be fair to Aileen, although I have found that Aileen has breached the duty of rendering a true and perfect inventory and account of the Estate, there is no finding of any dishonesty or fraud against Aileen based upon the evidence before the court. There is no finding that Aileen has done anything dishonestly, and there is also no finding that Aileen has done anything to benefit herself at the expense of the Estate or any beneficiary in the administration of the Estate. Such finding can only be made if there is clear and cogent evidence proving the same. In fact, Mr Lin has fairly submitted that based upon the evidence now available, he is not putting forward such a case.

(2)  Douglas, Rosalind and Madeleine have filed affirmations in HCMP 202/2020, in which they clearly stated that they are in support of Aileen continuing to be the administratrix of the Estate. Patrick has not stated whether he is in support of Aileen continuously being the administratrix. However, after all, it is fair to say that there is no evidence showing that the majority of the beneficiaries is in favour of removing Aileen.

(3)  It is true that there is hostility between Vicki and Aileen. However, hostility per se is not a sufficient ground justifying removal.

(4)  The discretion to remove an administrator is to be exercised with great caution and sparingly.

66.Having taken all the circumstances into account, I come to the conclusion that Aileen should be removed and be replaced by the Proposed New Administrators.

(1)  As submitted by Mr Lin, Aileen has failed to perform the administatrix’s duties in various aspects. Aileen has also failed to observe the order made by this court by failing to provide the necessary information and documents to PwC. Further, there is no evidence showing that Aileen is prepared to take any step to remedy those failures. On the contrary, there is evidence showing that Aileen is no longer interested to continue to administer the Estate. A lot of work has to be done in order to properly administer the Estate and to achieve the goal of distributing the assets fairly to all the beneficiaries. Taking all these into account, in my judgment, keeping Aileen as the administratrix would not be conducive to the proper and efficient administration of the Estate.

(2)  As said in the above, the Estate is substantial, and Aileen has breached the administratrix’s duties in various aspects. In view of all these, and given the mistrust between Vicki and Aileen, it would be more appropriate for the Estate to be administered by independent professionals.

(3)  Mr So and Mr Chin of PwC are the candidates nominated by Aileen to prepare the Report. In other words, the Proposed New Administrators are in fact professionals which have been nominated by Aileen previously. The Proposed New Administrators would have the requisite knowledge and skill to properly administer the Estate. They are the professionals in charge of the preparation of the Report. They are familiar with the background and the matters relating to the administration of the Estate. As submitted by Mr Lin, appointing them and not anyone else to be the new administrators would save significant time and costs. In the circumstances, I am of the view that the Proposed New Administrators are the appropriate independent professionals to be appointed.

67.In my judgment, Aileen should be removed from the office of the administratrix of the Estate, and the Proposed New Administrators should be appointed.

68.In Chan Sau Heung v Kwan Siu Fai[3], Poon J (as he then was) said:

“34. Returning to the present case, I think it is beyond doubt that the defendant has shown himself to be an unfit person to administer the estate. He has not taken any step to administer the estate. He has inexplicably refused to accept the very attractive offer made in respect of the Property. His conduct is detrimental to the due and proper administration of the estate and the interests of the beneficiaries. Removing him is plainly justified. However, removal alone is not enough. For upon removal, the defendant has to lodge with the court the Grant so that the order for removing him and appointing the plaintiff as administrator can be endorsed on it. Given his uncooperative attitude so far and his failure to participate in these proceedings despite service, there is a real and substantial risk that the defendant will not lodge the Grant with the court even if so directed. It will surely cause further unwarranted delay to the due and proper administration of the estate. The Grant should in the circumstances be revoked.”

69.In this case, Aileen is now unresponsive, not taking any step in the administration of the Estate and in these proceedings. There is a real risk that she may not lodge the Grant with the court even if being ordered to do so. For the purpose of avoiding further delay to the due and proper administration of the Estate, I would order that the Grant be revoked and a fresh grant be issued to the new administrators.

E.  COSTS

70.Mr Lin seeks costs against Aileen in both HCMP 202/2020 and HCMP 563/2022. There is no application for costs against the other defendants in HCMP 563/2022. The costs sought by Mr Lin in HCMP 202/2020 include the costs for preparing the Report.

71.Mr Lin has helpfully referred me to Re the Estate of Lee Da Kor[4], in which Poon J (as he then was) said:

“39. The general principles regarding costs in administration proceedings can be found in Re Buckton [1907] 2 Ch 406, summarised in Underhill and Hayton, Law Relating to Trusts and Trustees (17^th ed., 2007) paras.87.30-87.34. The third category of cases is that when a beneficiary has made a hostile claim against the executors and other beneficiaries, the unsuccessful party will be ordered to pay the successful party costs. The present case fell within that category. Further, the first to third defendants had defaulted in discharging their duties as executors. They should be responsible for the costs of these proceedings personally. And I so ordered.”

72.I agree with Mr Lin that the claim made by Vicki against Aileen for an order removing Aileen from office of the administratrix of the Estate in HCMP 563/2022 is a hostile claim, in which Vicki is the successful party. In accordance with the principle set out in Re the Estate of Lee Da Kor, costs of HCMP 563/2022 should be paid to Vicki by Aileen personally.

73.In the Amended Originating Summons in HCMP 563/2022, costs on indemnity basis are mentioned. However, in the hearing before me, Mr Lin has made it clear that Vicki is not seeking indemnity costs against Aileen. That being the case, I have no need to consider whether indemnity costs should be ordered.

74.As to the costs of HCMP 202/2020, I agree with Mr Lin that this case is occasioned by the failure of Aileen to discharge the duty of rendering a true and perfect inventory and account of the Estate, notwithstanding the repeated requests made by Vicki. I am of the view that costs of HCMP 202/2020 should also be borne by Aileen personally.

75.However, I am of the view that the costs for the preparation of the Report should be borne by the Estate and should not be borne by Aileen personally. Given the size of the Estate and the variety of the assets therein, it would be reasonable for any administrator to engage professionals to assist in the administration of the Estate. The costs incurred in engaging professionals should be borne by the Estate. What Aileen should do but has failed to do is to engage professionals at an earlier time to assist her to prepare the inventory and account of the Estate. Aileen has failed to do this. However, that does not mean that Aileen has to bear the costs incurred in engaging the professionals.

76.Mr Lin submits that since Aileen has failed to provide all the necessary information and documents to PwC, the Report is incomplete. Mr Lin is relying upon this as a point in support of his submission that Aileen should bear the costs for the preparation of the Report personally. With respect, I am unable to agree with Mr Lin on this point. Although the Report may not be complete, there is no doubt that the Report contains some useful information, and PwC has made some helpful observations therein. The new administrators may begin their work by making reference to the matters stated in the Report, which can certainly serve as a good starting point. In other words, the Report is meaningful and would facilitate the administration of the Estate. In the circumstances, I am of the view that the costs for the preparation of the Report should be borne by the Estate.

77.For avoidance of doubt, I should also say that if it is found at a later time that the non-provision of any information or document by Aileen to PwC while PwC was preparing the Report has caused any loss to the Estate, the new administrators may on behalf of the Estate seek appropriate reliefs against Aileen.

F.  DISPOSITION

78.At the end of the hearing, Mr Lin has helpfully provided me a draft order in each case. Mr Lin submits that Vicki is seeking orders in terms of the drafts, in the event that there is a judgment in her favour at the end. I have made some comments on those drafts in the hearing.

79.As set out in the above, I come to the conclusion that there should be judgment to Vicki, with the exception that I am unable to agree that costs incurred for obtaining the Report be borne by Aileen personally. In my judgment, those costs should be borne by the Estate. Subject to this and the necessary amendments mentioned by me in the hearing, I make an order in terms of the draft submitted by Mr Lin in each case.

80.Lastly, it remains for me to thank Mr Lin for the assistance provided to the court.

Mr Kenny Lin, instructed by Myra Li & Co, for the Plaintiff (in HCMP 202/2020 and HCMP 563/2022)

The Defendant (in HCMP 202/2020) and the 1^st to 5^th Defendants (in HCMP 563/2022) are not represented and absent in the hearing.