Norman Guy Donald and Others v. Li Pak Huen in His Capacity As Executor of the Estate of Li Pak Wing and Others

HCMP 1836/2017

[2024] HKCFI 645

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1836 OF 2017

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JUDGMENT

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Table of Contents

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A.  INTRODUCTION

1.The present application is by the independent professional administrators for an order of sale of a property in the estate of Li Sing Kui, deceased (“Deceased”).

2.This Court handed down a judgment herein on 26 April 2019 and amongst other things, removed the then executrix of the estate of the Deceased and ordered that independent professional administrators be appointed in her place (“Removal Judgment”)[1].

3.I will continue to adopt the abbreviations/nomenclature in the Removal Judgment, save otherwise indicated and in the case of the Deceased’s sons, I will refer to them hereinafter by their Chinese names.

4.As set out in the Removal Judgment, the Deceased died in Hong Kong on 28 August 1955, leaving a “Tin Fong” wife Madam Leung[2], two concubines Madam Cheung[3] and Madam Chau[4], 15 daughters and 5 sons[5]. The 5 sons (“5 Sons”) named in the Will were:

By Madam Cheung:

(1)  Pak Iu (Francis), who died on 20 June 1992 aged 81, leaving surviving him his wife Madam Wan Yee Mui (who passed away in 2002) and two children, namely Michael and Colleen[6];

By Madam Leung:

(2)  Pak Tat (James) , who died in October 1987 aged 62, leaving surviving him his wife Lynette (who was originally the 1^st plaintiff herein and who passed away on 22 November 2019), a daughter Lee Cheryl Ann (“Cheryl”) and a son Lee Andrew James;

By Madam Chau:

(3)  Pak Leung (Bernard), who died on 6 December 2014 aged 83, leaving surviving him his wife Daisy (who was originally the 1^st defendant herein and who passed away on 11 February 2022) and 4 children;

(4)  Pak Wing, who died in 2016 aged 83, and who left no spouse and no children and whose estate is the 2^nd defendant herein, and represented by Pak Huen;

(5)  Pak Huen, the 3^rd defendant herein.

5.Under the Will, Madam Chau, Pak Iu and Pak Leung were appointed the executors of the Estate by the Deceased. Pak Leung’s widow Daisy eventually became the sole executrix of the Estate on 16 November 2016, by virtue of a chain of representation.

6.Pursuant to the Removal Judgment, Daisy was removed as the sole executrix of the Estate. Subsequently, an order was made on 12 July 2019 by consent that the present plaintiffs (“Administrators”) be appointed as joint and several administrators of the Estate. The Administrators were later granted Letters of Administration with Will annexed de bonis non on 3 July 2020[7].

7.The originating summons herein was initially issued by three plaintiffs who were three of the beneficiaries of the Residuary Estate, namely Lynette, Michael and Colleen. At the heart of the dispute is the Family Property which forms a major part of the Residuary Estate and which has remained unsold.

8.One of the orders sought in the originating summons, in paragraph 2 thereof, was the Order for Sale, namely an order to sell the Family Property. This application was adjourned sine die by this Court pending the determination on whether Daisy should be removed, with liberty to restore[8]. Upon the appointment of the Administrators, the application for the Order for Sale was restored.

9.The Family Property was built in 1930s and has been listed as a Grade 2 historic building on 18 December 2009[9]. According to an earlier valuation report, it was valued to be HKD 440,000,000 as at 15 November 2017. Pursuant to an updated valuation report by JLL[10], subject to the assumptions set out therein, as at 30 May 2021, the aggregate existing use value of the unencumbered leasehold property interest was stated to be HKD 233,400,000 and the redevelopment value was stated to be HKD 565,000,000[11].

10.The Family Property comprises of , amongst others, 4 levels, from Ground Floor to 3^rd Floor and a roof. There is also a basement/garage. There are two apartments on each of the 1^st to 3^rd floors, respectively one on the East Wing and one on the West Wing.

11.On 15 October 2020, the Administrators had through their solicitors sent a questionnaire to the respective beneficiaries and/or their legal representatives, to, amongst other things, enquire into the state of occupancy of the Family Property and related matters (“Questionnaire”)[12].

12.Based on the respective answers received from the beneficiaries (“Answers”) and their own inspection visits to the Family Property, the Administrators prepared a table and diagram of their understanding of the state of occupancy of the Family Property, which was later updated in Mr Norman’s 2^nd affidavit of 18 April 2023 (respectively “1^st Occupancy Diagram” and “2^nd Occupancy Diagram”)[13].

13.On 7 November 2022, upon a summons issued by the Administrators on 14 October 2022[14], leave was given for them to join as plaintiffs herein and for Lynette, Michael and Colleen to cease to be plaintiffs. The 4 children of Pak Leung and Daisy, who are beneficiaries of the Residuary Estate, have been added respectively as the 4^th to 7^th defendant. Michael is now the 8^th defendant in his capacity as executor of the estate of Pak Iu (by chain of representation). Cheryl has been joined as the 9^th defendant being executrix of the estate of Pak Tat (by chain of representation). The 4^th defendant, Bernard Jr, has also been named as the 10^th defendant in his capacity as personal representative of the estate of Pak Leung (by chain of representation). Apart from family members/beneficiaries of the Residuary Estate, the Administrators were also granted leave to join a Mr Tsang Kwok Cheung (“Tsang”) as defendant in his absence.

14.Tsang claims to be a former cohabitant of Pak Wing and has in his affirmation alleged that under the arrangement of Pak Wing, he moved to reside in Pak Wing’s apartment on 3/F West Wing in around 1979 to live with Pak Wing and that he has continued to occupy the apartment after Pak Wing’s death until today. On 21 March 2023, Tsang commenced a separate action by writ against the Administrators, under HCA 426/2023, to claim, amongst other things, a declaration that he has been in adverse possession of the apartment on 3/F West Wing (“HCA 426”). On 19 July 2023, this action was ordered by consent to be stayed pending the final determination of the Administrators’ present application for the Order for Sale.

15.Notwithstanding that the stay of HCA 426 was by consent, Tsang appeared to be reneging from his consent for the stay at the commencement of the present trial in that he indicated that he would have no objection to the Order for Sale if such was made subject to the determination of his claim in HCA 426 and that it was more proper to deal with his claim in HCA 426 rather than in these proceedings. He complained about not having enough time for him to seek proper further and better particulars and/or discovery and to prepare his claim in the present proceedings.

16.There was however no proper application issued by Tsang to withdraw his consent to the stay and/or to set aside the stay. It was in any event too late for him to change his position at the trial as (i) he was served with the Administrators’ summons for joinder but failed to turn up at the hearing on 7 November 2022 when the order for joinder was made against him; (ii) he was then served with the amended originating summons and he had filed an acknowledgment of service on 20 December 2022 through his present solicitors, indicating his intention to contest these proceedings; (iii) he did not apply to set aside the joinder or to seek any directions for extension of time or discovery or other directions in relation to the trial and instead commenced HCA 426; (iv) he had filed an affirmation on 13 February 2023 setting out his case in opposition to the Administrators’ application for the Order for Sale and asking the Court to refuse the Administrators’ application for the Order for Sale, and lastly (v) as mentioned, he had consented to the HCA 426 being stayed.

17.Apart from Tsang, the Administrators’ application is being opposed by Pak Huen, both in his capacity as executor of the estate of Pak Wing (ie 2^nd defendant) and in his personal capacity as a beneficiary of the Estate/Residuary Estate (ie 3^rd defendant). The disputed units at trial are (i) 1/F, West Wing, (ii) 2/F, East Wing, and (iii) 3/F, West Wing.

18.The 4^th, 5^th, 6^th and 10^th defendants take a neutral stance to the Administrators’ application (collectively “Neutral Ds”).

19.The 7^th defendant Lee Pui Yin Irene (“Irene”) and 8^th defendant, Michael, are acting in person. They attended the trial physically and indicated that they do not contest the present application.

20.It is Cheryl’s position that the grounds of opposition raised by Pak Huen and Tsang should be rejected and that the Court should grant the Order for Sale with vacant possession.

21.To summarise, the only persons who oppose the Order for Sale are Pak Huen and Tsang.

22.Counsel Mr Eugene Fung SC and Ms Bonnie Cheng appeared for the Administrators in the present application, Mr Anson Wong SC and Mr Justin Lam appeared for Cheryl, Mr Edward Chan SC and Mr Abel Lam appeared for the 2^nd and 3^rd defendants, namely Pak Huen, Ms Lorinda Lau and Mr Forest Fong appeared for Tsang, and Mr Tommy Cheung appeared for the Neutral Ds.

B.  PAK HUEN’S GROUNDS OF OPPOSITION

23.It was Pak Huen’s case in his 1^st affirmation and at the time of the removal application that there was an overall understanding and de facto family arrangement among the 5 sons of the Deceased that so long as one of them should be living and residing in the Family Property, the Family Property would not be sold (“Family Arrangement”) and that the then executrix was estopped from selling the Family Property during his lifetime while he was/is living there[15].

24.In his 3^rd affirmation, Pak Huen maintained that there was the Family Arrangement, and that the Administrators are estopped at law from denying the Family Arrangement. He has however advanced a new alternative case, that he has been in adverse possession of the apartment on 2/F East Wing, and also of the apartment on 1/F West Wing as his own store room, since 2002 (when his mother Madam Chau passed away)[16].

25.To summarise, Pak Huen’s opposition to the Order for Sale was based on his allegations of:

(1)  Family Arrangement and/or promissory estoppel

(2)  adverse possession

C.  TSANG’S GROUNDS OF OPPOSITION

26.Tsang in his affirmation alleged that he has been in adverse possession of 3/F West Wing since around 1979, or alternatively the Estate is estopped from denying his alleged beneficial interests in 3/F West Wing[17]. As seen from Tsang’s Opening Submissions[18], his grounds for claiming an interest in 3/F, West Wing are based on, amongst others,

(1)  adverse possession

(2)  constructive trust

(3)  estoppel

(4)  acquiescence/laches

D.  THE AGREED DISPUTED ISSUES

27.There are 4 agreed disputed factual issues for trial:

(1)  Issue 1 - Whether the Family Arrangement as alleged by Pak Huen exists and binds the Administrators

(2)  Issue 2 - Whether Pak Huen has acquired a possessory title over any part of the Family Property

(3)  Issue 3 - Whether Tsang has acquired a possessory title over any part of the Family Property

(4)  Issue 4 - Whether vacant possession of the Family Property should be given to the Administrators and whether the Family Property should be sold and on what terms

28.Tsang had proposed a different version of Issue 3 above, which was not agreed by the Administrators. Tsang’s version was:

“3(a) Whether Tsang has acquired a possessory title and/or beneficiary interests over any part of the Family Property

3(b) Whether [Pak Wing’s][19] Promise as alleged by Tsang exists and the said promise was made on behalf of the Deceased/Estate, and if so, whether Tsang suffered detriments in reliance on the said promise

3(c) Whether the Estate knew of and stood by the “Expenses in Maintaining 3/F West Wing” and “My Efforts” as defined in Tsang’s Affirmation, and whether the Estate had waived its right to claim any interest in 3/F West Wing against [Tsang][20] and/or acquiesced to [Tsang’s][21] beneficial interest in 3/F West Wing.

E.  THE WITNESSES

29.Mr Guy Norman, one of the Administrators, had filed 2 affidavits and had attended the trial for cross examination.

30.Lynette had filed a total of 4 affidavits in 2017 and 2018, and Daisy had filed a total of 3 affirmations. As set out earlier, both Lynette and Daisy have passed away after the Removal Judgment. The Administrators issued a summons on 2 August 2023 for their respective affidavits/affirmations to be admitted notwithstanding that they had passed away and were unable to attend the trial for cross examination[22]. There was no opposition and this Court made an order in terms on the 1^st day of the trial with costs reserved.

31.Michael had filed an affidavit in 2017. As said, he supported the application for the Order for Sale. He was present during the 1^st and 2^nd day of the trial but was not required for cross examination.

32.Pak Huen had filed 3 affirmations and was scheduled to attend the trial for cross examination on the 1^st day of trial after Mr Norman, but, after mid morning break, Mr Chan SC suddenly announced that Pak Huen would not be called as scheduled without any reason being provided to the Court at the time. Following that, Mr Wong SC then indicated that it was no longer necessary for him to call Cheryl who had filed an affidavit essentially to respond to matters raised in Pak Huen’s affirmations.

33.This left only Tsang who did attend trial to be cross examined on the affirmation filed by him.

F.  PAK HEUN’S CASE

F.1  Generally

34.The Administrators only came into the picture after their appointment on 12 July 2019. They had no direct and/or first hand knowledge of the family history and circumstances of this case prior to their appointment save from information gleaned from the court documents and/or other documents and information provided to them by the beneficiaries.

35.Although the Administrators have replaced Lynette, Michael and Colleen as plaintiffs in this action, the dispute is essentially between, on one hand, the beneficiaries of Pak Iu’s and Pak Tat’s respective estates and who are collectively entitled to 2 out of 6 shares of the Residuary Estate and who want the Family Property to be sold with vacant possession, and on the other hand (i) Pak Huen, the youngest of the 5 Sons (in his personal capacity as the only surviving one of the 5 Sons and beneficiary and in his capacity as the executor and beneficiary of Pak Wing’s estate) and (ii) Tsang, a non beneficiary of the Residuary Estate and a non family member.

36.By the time of the trial, the Deceased had passed away for 68 years, and probate had been granted to the executors of the Estate for some 66 years, and Madam Chau, the last of the surviving spouse/concubines who was entitled to reside in the Family Property for life had passed away for some 21 years. Yet, the Family Property had not been sold and the Estate had not been wound up. In my view, by any standard and on the face of it, there had been a long delay in the winding up of the Estate. As stated in the Removal Judgment, there had been no distributions since 2002 until only in early December 2018, two years after Daisy became the executrix by chain of representation and after the issue of the originating summons herein for her removal. This Court found that although Daisy could not be blamed for any delay prior to her being granted Probate, there had been continuing unjustified delay on her part towards administration and distributions, and this was one of the grounds for her removal.

37.Insofar as Pak Huen is concerned, he has put forward various grounds set out earlier to oppose the Order for Sale. In this Court’s Order of 7 November 2022, it is stipulated that all deponents shall attend the trial for cross examination, filing which such deponent’s affidavit evidence shall not be admitted unless with the leave of the Court[23] (“November 2022 Order”). Pak Huen’s last 3^rd affirmation was filed on 19 December 2022, after the November 2022 Order and only 8 months before the trial. He should be fully aware of the November 2022 Order.

38.As pointed out by Mr Wong SC on behalf of Cheryl (9^th defendant), Pak Huen is the only witness with personal knowledge of matters which happened decades ago. Notwithstanding having filed 3 affirmations, and fully aware of the November 2022 Order, yet he failed to attend the trial for cross examination.

39.Lynette and Daisy could not attend trial as they had passed away and leave had been sought and granted for their evidence to be admitted. Michael was not required for cross examination, and Cheryl only decided not to attend for cross examination as her evidence was mainly in response to Pak Huen’s 3^rd affirmation. Pak Heun did not give any reasons for his absence.

40.Although Pak Huen was 84 at the time of his 3^rd affirmation, as set out later, he was able to recall various matters which he did not recall or did not disclose in his earlier affirmations, and had further raised a new ground of opposing the Order for Sale, namely adverse possession.

41.The purpose of cross examination is essentially to test the veracity of the disputed part of a witness’s evidence. Pak Huen’s absence had taken this Court by surprise. In Pak Huen’s Closing Submissions, it was submitted that having assessed the state of the evidence before this Court at the close of the Administrators’ case, it was Pak Huen’s decision that his viva voce evidence was not necessary[24]. However, he is the only surviving one of the 5 Sons and an essential witness, as he had put forward various grounds for opposing the Order for Sale, and the burden was on him to establish his grounds. In my view, the Court is entitled to draw at least an inference from Pak Huen’s absence that he did not wish to be cross examined on the veracity of his evidence.

42.In the circumstances, there is no reason as to why those parts of Pak Huen’s disputed evidence to oppose the Order for Sale should be admitted. Consequently, it is not necessary to admit that part of Cheryl’s evidence in her affidavit responding to/refuting Pak Huen’s disputed evidence. Although this should not affect the undisputed part of their respective written evidence, no leave/direction was sought to admit any part of their respective affirmations/affidavit, and all Closing Submissions were made on the basis that Pak Huen’s 3 affirmations and Cheryl’s affidavit were not admitted.

F.2  Issue 1 – the alleged Family Arrangement

43.As seen in Pak Huen’s Closing Submissions, there were no submissions made in relation of Pak Huen’s case of there being the Family Arrangement. It was only submitted on behalf of Pak Huen that “the relevance and importance of Pak Huen’s live evidence to support his case is likely to be very limited, and that it was open to Pak Huen (and was indeed his decision) to rely principally upon the objective factual evidence to found his defence of adverse possession”[25].

44.This was also confirmed by Mr Chan SC in oral submissions on the final day of the trial, namely his submission was that having seen Lynette’s, Daisy’s and Michael’s affirmations, it was Pak Huen’s decision to rely only on his case of adverse possession. Issue 1 is thus no longer an issue before this Court. In any event, as his written evidence on the Family Arrangement was not admitted, I find no “ objective factual evidence” to support Pak Huen’s alleged Family Arrangement. The fact that Pak Huen lived in the Family Property at the time of the Deceased’s death and has continued to live there since, and that all the 5 Sons had resided in the Family Property would not mean there was the Family Arrangement as alleged by Pak Huen. It was submitted on behalf of Pak Huen that the Estate had permitted members of the Deceased’s family to use and/or occupy various parts of the Family Property and/or that no actions were taken to sell the Family Property since the death of Madam Chau until the present proceedings. However, in my view, this would not necessarily mean that this was because of the existence of the alleged Family Arrangement.

45.It was Lynette’s written evidence that she did not understand why the Residuary Estate remained unadministered and she was not aware of any legal or practical reasons for this[26]. According to Lynette, she and Pak Tat met in the United States and married in 1954. After their marriage, they returned to Hong Kong from United States (where Pat Tat went to attend university) when the Deceased suffered a stroke. They lived in the Family Property until Pat Tat passed away in October 1987 and she later moved back to United States. It was her written evidence that she had never heard her late husband Pak Tat or Pak Huen mention about the Family Arrangement[27]. It was also Lynette’s written evidence that there was no reason why she and her family should all be kept out of their inheritance and that she had travelled to Hong Kong in April 2014 to meet with Pak Leung (who was then still living) and Daisy[28]. She had also said that Pak Leung did not cooperate and failed to provide her any information and that she had to engage solicitors to formally request for an updated list of assets of the Estate, and that she understood Pak Huen at the time intervened on her behalf and tried to convince the then executors to cooperate. There was no mention by Lynette that anyone had mentioned to her about the alleged Family Arrangement.

46.Even Daisy, who was the executrix prior to her removal, and whose husband Pak Leung was born by the same mother as Pak Huen, had said that she had “no recollection that during the life time of her husband that he had ever mentioned to her the existence of the Family Arrangement”[29]. As found in the Removal Judgment, it would appear that from Daisy’s written evidence that even Pak Huen did not assert to Daisy at that time that he had any entitlement to continue to live in the Family Property by reason of by Family Arrangement, and that all he did was to express to Daisy that he wanted to continue to live there[30].

47.As for Michael, the executor of his father Pak Iu’s estate, stated in his answer to the Questionnaire that he was not aware of any arrangement by which any person occupied any part of the Family Property[31].

48.Pak Huen was the youngest of the 5 Sons, and Pak Iu appeared to be some 27 years older than Pak Huen, and Pak Tat some 13 years older than Pak Huen. At the time of the Deceased’s death, Pak Iu was 44 years old, Pak Tat was about 30 years old and Pak Huen was at that time only 16 years old. There was no sufficient evidence as to their relationship, namely whether Pak Iu and Pak Tat were ever close to their younger half brothers, or to each other. However, considering their respective ages, it did not in my view seem probable that, in particular in the case of Pak Iu, he would agree to an arrangement which was likely to affect his family/estate most, namely a postponement of the sale the Family Property until the death his youngest half brother.

49.Having considered all the “objective” evidence before this Court, I find no sufficient evidence to support Pak Huen’s allegation of there was an oral agreement between the 5 Sons as to the Family Arrangement.

50.Insofar as the promissory estoppel, there was no sufficient written evidence as to any promise/assurance made to Pak Huen by any of the 5 Sons and/or by the Estate, nor any evidence of any reliance thereon by Pak Huen and/or any detriment suffered by Pak Huen in reliance thereon.

F.3  Issue 2 - the alleged adverse possession

F.3.1.  General legal principles

51.There was no dispute over the general legal principles of adverse possession. The burden is on the claimant to prove two basic elements: (1) factual possession and (2) the requisite intention to possess (or animus possidendi)[32]. The burden of proving the lack of licence or consent rests with the squatter who must discharge his burden by adducing compelling evidence[33]. Further, to constitute possession for the purposes of limitation, the claimant must show that he took possession of the land in his own right and not as licensee or representative of another person, even if that other person is not the true owner or an agent acting on behalf of the true owner[34].

F.3.2.  Factual possession and animus possidendi

52.No one had at any time sought any direction as to whether the present application in the Originating Summons should have been continued as if commenced by writ. There have been no pleadings filed. Without any of Pak Huen’s affirmations being admitted, there was simply no evidence from him, ie the claimant, to support his case for adverse possession.

53.Both Mr Fung SC, for the Administrators, and Mr Wong SC, for Cheryl have submitted that Issue 2 should no longer be an issue and/or Pak Huen’s case should be rejected in limine.

54.Mr Chan SC had on the other hand submitted in Pak Huen’s Closing Submissions, that there is adequate evidence before the Court for the Court to make a finding on Pak Huen’s case, based on the objective and undisputed evidence, and absent any prima facie case to the contrary (which was submitted to be none), there is simply no basis for the Court to resort to the drawing of adverse inference[35].

55.Anyway, even if this Court were to consider only the objective and undisputed evidence, all such evidence in my view in fact supports the Administrators’ case that Pak Huen’s occupation was and is with the knowledge and permission of the executors of the Estate. My reasons are set out hereinafter.

56.First, as to Pak Huen’s factual possession, according to Pak Huen’s Opening Submissions, he has been residing in the Family Property, specifically in the apartment on 2/F, East Wing and using the apartment on 1/F, West Wing to the exclusion of the world at large[36]. This was in fact not even consistent with his own evidence.

57.The occupation status of the Family Property in 2017 was set out in paragraphs 105 to 108 of the Removal Judgment[37] which is reproduced below for ease of reference:

“105. According to Pak Huen, no one has the exclusive right to use or occupy the Ground Floor, but there are cubicles for storage. At the moment, Lynette is using 2 of those cubicles, Pak Huen is also using 2 cubicles, Michael is using 1, and Daisy is using 1. There are 3 floors, each with two apartments, one on the east and one on the west.

106. On the 1^st Floor, the Deceased used to occupy the East Wing while Madam Cheung and her children used to occupy the West Wing. Later, Bernard [Pak Leung] and his family occupied those 2 Wings, and after his death, Daisy has continued to occupy those 2 Wings on the 1^st Floor, and at present with 2 of her 4 children.

107. As for 2^nd Floor, Pak Huen and his son are now occupying the East Wing, while Michael and his family are now living in West Wing.

108. As for 3^rd Floor, according to Pak Huen, Lynette and her children occupy the East Wing and the West Wing was occupied by Pak Wing and after his death in March 2016, it has been vacant.”

58.The above information in relation to the occupation of 1/F, West Wing was reflected in Michael’s 1^st affirmation and also in Pak Huen’s own 1^st affirmation, in particular in a chart “LPH-2” which was produced by Pak Huen[38]. It was this Court’s finding in the Removal Judgment that for the two Wings on 1/F were occupied by Pak Leung and his family and after Pak Leung’s death, Daisy had continued to occupy the two Wings on the 1/F, and at the time with two of her four children[39].

59.As mentioned earlier, in October 2020, the Administrators had sent the Questionnaire to each of the beneficiaries including seeking information on the occupation status of the Family Property. On 30 November 2022, Pak Huen’s former solicitors Messrs Edmund WH Chow & Co had provided Pak Huen’s Answers, namely, the part of the Family Property then stated to be occupied by Pak Huen (and his son) was 2/F East Wing. There was no mention of Pak Huen’s occupation or use of 1/F West Wing and/or any other parts of the Family Property[40]. On 13 January 2021, the Administrators had sent a letter to all the beneficiaries providing a further progress update on the administration, with a summary of the beneficiaries’ respective Answers[41]. There was no indication from Pak Huen that the Answers provided by him were incorrect.

60.Further, according to the Administrators’ 1^st Occupation Diagram, Pak Huen’s former solicitors Messrs Edmund WH Chow & Co claimed that Daisy should have the keys to the apartment on 1/F West Wing but Daisy’s solicitors claimed that she did not have such keys [42]. The Administrators were at that time trying to find out, among other things, as to who held the keys to 1/F West Wing in order for them to carry out inspection and/or valuation. The Neutral Ds in their Closing Submissions had also pointed out that the Administrators’ communications with Daisy’s then solicitors in relation to the key(s) to 1/F West Wing were only initiated after the Administrators were appointed and disputes among some family members of the Deceased had already arisen, and that Daisy’s solicitors’ then response, namely she did not have the keys, was a factual one limited to a state of status quo at that point in time[43]. In any event, as Mr Norman had said, he was given the “run around ”, as although he was informed by Daisy’s then solicitors that the keys were with Pak Huen, he was not able to get the keys from Pak Huen.

61.It appeared that Pak Huen only formally changed his solicitors on 21 October 2022[44]. It was only in a letter dated 12 December 2022 from Pak Huen’s present solicitors (“12.12.22 Letter”) that the Administrators were formally informed that Pak Huen was/is using the 1/F West Wing as a storeroom and that he had placed a lot of his personal belongings and chattels in it (save the Guest Room), and that all the personal belongings and chattels inside 1/F West Wing (other than the belongings of Madam Cheung and/or her daughter) are assets of Pak Huen or his family and not chattels of the Estate[45]. In fact, in this letter, Pak Huen was also claiming that he was occupying/using :

(1)  2/F, East Wing

(2)  1/F, West Wing ( except the Guest Room)

(3)  Room 3 at Basement and his carpark[46]

(4)  all rooms on Ground Floor with his name marked on the Ground Floor Plan

62.It was after the 12.12.22 Letter that Pak Huen’s 3^rd affirmation was filed on 19 December 2022. In this 3^rd affirmation, Pak Huen claimed that after his mother Madam Chau passed away in 2002, only he and his immediate family had/have the keys and exclusive access to, control and possession of 2/F, East Wing and 1/F, West Wing to the exclusion of others, whether it be other family members or otherwise, and that none of his other family members are permitted to enter without his permission. He had said that he had all along intended and treated 2/F East Wing and 1/F, West Wing as his own and excluded everyone else from entering or otherwise accessing those parts of the Family Property for more than 12 years, and he did intend to possess those parts of the Family Property so that he could live there at least until the end of his days[47].

63.Thus, notwithstanding his solicitors’ letter a week earlier, in his 3^rd affirmation he was only seeking adverse possession of 2/F East Wing and the entire 1/F, West Wing , which appears now to include the “Guest Room”, without any mention of the other rooms/spaces occupied or used by him. I have to say, even if his affirmations were admitted, his written evidence was confusing and inconsistent.

64.Having considered all the “objective” and/or “undisputed” evidence, there was simply no evidence to support Pak Huen’s case that he had occupied or was in possession or in control of 1/F West Wing since the death of Pak Iu and Madam Chau, or for more than 12 years prior to his 3^rd affirmation (even if such were admitted). In my view, Pak Huen is not even able to satisfy this Court of the 1^st element of factual possession, for his adverse possession claim in respect of 1/F West Wing.

65.Second, as for 2/F East Wing, it was not disputed that Madam Chau was residing there until her death in 2002, and she was clearly entitled to reside there under the provisions of the Will, and further it was not disputed that she had resided there with the knowledge and permission of the then executors of the Estate. After her death, Pak Huen has continued to occupy 2/F East Wing with his family members, and currently, he is residing there with his son. However, even though there is no dispute that Pak Huen resides in 2/F, East Wing and has a set of keys, this is not sufficient to establish factual possession under the 1^st element in an adverse possession claim.

66.The undisputed evidence clearly shows that Pak Huen has been occupying 2/F East Wing with the knowledge and permission of the executors. At all material times, the executors (except for the Administrators) had been living in the Family Property and were/are members of the same family, including Pak Huen’s mother Madam Chau and his full blooded brother Pak Leung and Pak Leung’s wife Daisy. Further, from Tsang’s evidence, there is a gate outside the main entrance to the Family Property, which was changed about 10 odd years ago, and that he had received the keys to 3/F West Wing from Pak Huen. This would mean that Pak Huen must have received his own keys to the new gate from the then executors of the Estate.

67.In any event, the evidence indicates that the Estate had paid for the government rates, electricity and water bills of all the disputed units since at least 2000[48], and that the Estate had made payment of HKD 200,000 in 2005 to Pak Huen for repairs of 2/F East Wing[49].

68.Having considered all the “objective” and/or “undisputed” evidence, I find that Pak Huen has not been able to demonstrate that his occupation and possession of 2/F East Wing has been without the knowledge and permission of the Estate.

69.Third, in Pak Huen’s Closing Submissions, it appears to be accepted by him that it is reasonable to infer that there is a licence for Pak Huen to occupy 2/F East Wing, but he seems to be arguing that the licence was only granted by his father , namely the Deceased, and his mother, namely Madam Chau, and that such licence was revoked or lapsed upon their deaths[50].

70.The Deceased was the registered owner of the Family Property, and any licence granted by him would have been terminated upon his death. However, any licence granted by Madam Chau would have been granted by her in her capacity as one of the named executors of the Estate, and on behalf of the Estate. I do not agree that upon her death, such licence would automatically be terminated. The fact is that the remaining executor was Pak Leung followed by Daisy. Daisy was fully aware of Pak Huen’s occupation as she had had discussions with Pak Huen and that Pak Huen had indicated to her that he wanted to continue to live in the Family Property[51], and he was alleging the Family Arrangement at that time[52].

71.Having considered the evidence, I am of the view that all the evidence indicates that Pak Huen’s occupation of whether 2/F East Wing and or 1/F, West Wing or any parts in the Family Property has been with the knowledge and permission of the executors of the Estate, prior to the appointment of the Administrators.

72.Fourth, as for the requisite intention to possess, animus possidendi, there was simply no evidence of Pak Huen’s intention was to exclude the world at large including the Estate, namely the owner of the Family Property, whether in relation to 1/F West Wing or 2/F East Wing. There was no evidence of Pak Huen having ever made it clear to the Estate that he had the intention to possess 1/F West Wing and/or 2/F East Wing until his 3^rd affirmation.

73.In the above circumstances, Pak Huen has not been able to demonstrate that he has acquired a possessory title over any part of the Family Property and his claim as to adverse possession must fail.

G.  TSANG’S CASE

G.1  Tsang’s evidence

74.According to Tsang’s affirmation, his father was an acquaintance of Pak Wing whom Tsang addressed as “Uncle Li”, and that in around 1979, through the recommendation of Tsang’s father, Pak Wing agreed to take Tsang on as his “god-son”. Tsang said as his father hoped he could learn about doing business from Uncle Li by shadowing and assisting Uncle Li with his daily work, Tsang’s initial role was akin to that of Uncle Li’s personal assistant and his office boy. In order to ensure that he would learn well and work hard, his father and Uncle Li arranged for him to move into Uncle Li’s apartment on 3/F, West Wing, in around 1979 since when he had been living there with Uncle Li, and after Uncle Li’s death, he has continued to live there.

75.It was Tsang’s evidence that as Uncle Li did not have any children, he treated Tsang as his son, and that over the years Uncle Li mentioned that Tsang would have ownership of (有份) 3/F, West Wing (“Promise”)[53].

76.It was also Tsang’s written evidence that there were different households residing at different wings on different floors of the Family Property but he had never become acquainted with any of them, except Pak Huen. According to Tsang, he and Uncle Li were the only persons who had the keys to 3/F, West Wing, and that no one was free to enter except Uncle Li and him, and that they had exclusive access to, control and possession to 3/F, West Wing. Tsang said he never paid any rent or licence fee nor was he ever expected to pay any rent or licence free and all along he had intended to treat 3/F West Wing as his own and excluded everyone else from entering or otherwise accessing the apartment for more than 20 years.

77.Further, according to Tsang, relying on the Promise, he had always regarded 3/F West Wing as his own property and that he had paid for repair/maintenance and improvement works of the apartment, and spent time and efforts in addition to money following up on the maintenance and improvement works over the years.

78.In support of his case, Tsang had produced various documents including photographs (with no dates)[54], and the following:

(1)  Copy of an extract on the Business Register of the registration of Tsang’s business Andy Printing Company at an address in Kwai Chung, with date of commencement of business on 1 December 1996 and with Tsang’s residential address given as “15, Robinson Road, Hong Kong”[55];

(2)  Copy of a Fortress receipt of illegible date issued to Tsang for HKD 638 for the purchase of a household product, with a delivery address at 3/F West Wing of the Family Property and a delivery date 17/05/03[56];

(3)  Copy of a PCCW bill of HKD 120 addressed to Tsang at 3/F West Wing, of issue date 17/08/10[57];

(4)  Copy of a sales invoice dated 23 September 2011 of about HKD 2,000 from Mayfair Medical Supplies Ltd addressed to someone called “Chan Wai Yee” at an address in Sham Shui Po, but with delivery address at 3/F West Wing[58];

(5)  Copy of a Public Bank statement dated 29 November 2014 addressed to Tsang at 3/F, West Wing[59];

(6)  Copy of an AFG Securities Limited Account Opening Declaration dated 31 October 2017 by Tsang, with his residential address stated to be at 3/F, West Wing, but his correspondence address stated to be an address on the 15 floor of an building on Des Voeux Road Central[60];

(7)  Copy of a payment confirmation notice of Manulife dated 26 May 2020 addressed to Tsang at 3/F West Wing[61];

(8)  Copy of a Dah Chong Hong Ltd Delivery Note dated 10 September 2021 addressed to Tsang at the Family Property for some TV equipment (?)[62];

(9)  Copies of 2 Hibachi delivery notes dated 11 March 2022 and 6 January 2023 for household items with Tsang as “contact person” and delivery address “15 Robinson Road, Ground Floor”[63];

(10)  Copy of a delivery order of Shun Hing Group of a microwave oven , to be delivered to Tsang of (illegible address)[64];

(11)  Copy of a Prudential official receipt dated 5 December 2022 addressed to Tsang at 3/F, West Wing[65];

(12)  Copies of 2 Kompass Creative Services Ltd invoices dated 30 September 2009 for cleaning 2 air conditioners and adding refrigerant , and for repairs to windows[66]

79.During the trial, Tsang confirmed there was no formal adoption although he claimed to be a “god son” of Pak Wing and that he has since 1979 been living in Pak Wing’s apartment on 3/F, West Wing of the Family Property and that he has a key to that apartment, and also a key to the main entrance of the Family Property. He said he did not know Pak Iu or Pak Leung, and had only been to Pak Huen’s apartment and not the others. Tsang said he had met Madam Chau, the mother of Pak Wing and Pak Huen, who was living with Pak Huen before she passed away.

80.Tsang claimed that he did not know that the Family Property was/is owned by the Estate until he was joined as a defendant herein, and that he claimed that he had understood that Pak Wing owned the apartment 3/F, West Wing, and that Pak Wing had told him that the apartment belonged to Pak Wing and him.

G.2  Analysis of evidence and findings

81.First, In Tsang’s affirmation, he had referred to paragraph 108 of the Removal Judgment set out earlier, and he said that what was stated that about the apartment on 3/F, West Wing being vacant after Pak Wing’s death was incorrect and that he believed that the Court had not been provided with the correct evidence[67].

82.As set out earlier, the information set out by this Court in paragraph 108 of the Removal Judgment was based on the then evidence of Michael and Pak Huen.

83.Having said this, it appeared that by December 2019, the Administrators were aware of Tsang’s alleged occupation of 3/F, West Wing. Mr Norman had mentioned in his 1^st affidavit that the Administrators had written to Tsang on 16 December 2019 and 13 January 2020 to enquire about the basis on which he allegedly occupied the apartment and the details of any monthly rent that he was paying, and that according to Mr Norman, on 15 January 2020, Tsang had telephoned the representatives of the Administrators and confirmed that he had been residing at 3/F, West Wing with Pak Wing since the 1980s and had continued residing there since Pak Wing passed away, and also confirmed that no lease arrangement had been entered into and that he was not paying rent[68].

84.At the trial, it was put to Mr Norman that it was the Administrators’ staff who telephoned Tsang to request for access to 3/F, West Wing, and that Tsang did not mention anything about whether there was any lease arrangement. Mr Norman had explained that as they did not have Tsang’s telephone number, they could not have contacted him by telephone and that was why they had to send him two letters. It was thereafter that Tsang telephoned their staff to confirm that he had been residing at 3/F, West Wing with Pak Wing since the 1980s and had continued to reside there. It was Mr Norman’s evidence that what was stated in paragraph 47 of his affidavit was from their record of the conversation.

85.The staff who spoke to Tsang was not called, and in any event, I accept that there was no sufficient evidence from what was stated by Mr Norman in paragraph 47 that Tsang had admitted that he was permitted to reside at 3/F West Wing by any one after Pak Wing’s death.

86.Second, in Tsang’s affirmation, there was also an allegation that the Administrators had misled the Court by their skeleton submissions dated 2 November 2022 that Tsang said he was permitted by Pak Wing to stay in 3/F, West Wing[69]. Since the actual paragraph 47 of Mr Norman’s affidavit had been referred to the Court, there was no evidence that the Administrators had intended to mislead the Court, nor was there any evidence that the Court had been misled.

87.Third, Mr Norman had referred to the letter dated 30 November 2020 from Pak Huen’s former solicitors to the Administrators’ solicitors with Pak Huen’s Answers to the Questionnaire[70]. It was stated in Pak Huen’s Answers amongst other things, that 3/F, West Wing was and had been occupied by Tsang for decades with the consent and during the lifetime of Pak Wing and that Tsang had been treated as if he were a family member by both Pak Wing and Pak Huen; and after Pak Wing passed away in 2016, Pak Huen was the sole beneficiary of the residuary estate of Pak Wing and continued to allow Tsang to remain in occupation as before[71].

88.During cross examination, Tsang did not dispute what was stated in Pak Huen’s above Answers save that he disagreed that Pak Huen had treated him as a family member. What is clear is that even on Tsang’s own evidence, he moved into 3/F West Wing at the invitation of Pak Wing and with Pak Wing’s agreement. Although in Tsang’s Closing Submissions, it appeared to be submitted on his behalf that both Tsang and Pak Wing had excluded the whole world from 3/F, West Wing, this was a new case on Tsang’s part with no supporting evidence. In my view, Pak Wing himself was clearly residing in 3/F West Wing with the permission of the executors of the Estate, and it was not really disputed that Pak Wing had received HKD 200,000 from the Estate in relation to the repairs of 3/F West Wing in November 2005. Tsang’s status would appear to be an invitee of Pak Wing. In any event, Tsang had agreed that upon Pak Wing’s death, he was allowed by Pak Huen to continue to remain in occupation of 3/F West Wing as before. In light of this, Tsang’s adverse possession claim must fail. Further, Pak Wing only died in 2016 and even if Tsang had been in adverse possession since Pak Wing’s death, such fell short of 12 years prior to the commencement of HCA 426.

89.Fourth, the documentary evidence which Tsang had produced mainly indicated purchases of small household items , and only two invoices of same date in 2009 from Kompass Creative Services Ltd indicated some repair/maintenance/improvement works to 3/F, West Wing which were minor. In my view, such documents are not sufficient to establish factual possession in law for adverse possession.

90.As for the requisite animus possidendi, on Tsang’s own evidence, he could not have intended to exclude Pak Wing (at the very least) from 3/F West Wing, who only passed away in 2016.

91.Fifth, as for common intention constructive trust is concerned, the undisputed fact is that Pak Wing was never the owner of 3/F West Wing. Pak Wing must be fully aware that he was only a beneficiary in the Estate, and that 3/F West Wing was not for him to gift to anyone. In fact, Pak Wing had made provisions in his own will for Tsang and had bequeathed to Tsang a property at Sing Ping Street[72]. There was no evidence that Pak Wing had bequeathed or had intended to bequeath 3/F West Wing or any share thereof to Tsang, and this was in fact admitted by Tsang in cross examination.

92.There was simply no sufficient evidence of the Promise as alleged by Tsang. The words which Tsang said Pak Wing used were “有份” but these words were vague and would not necessarily mean that Tsang was to have ownership of 3/F, West Wing. In any event, in my view whatever common intention Pak Wing and Tsang had, this could not have given rise to any beneficial interest in 3/F West Wing being given to Tsang.

93.Sixth, on estoppel, acquiescence and/or laches, there was no sufficient evidence that Tsang was under any mistake as to his rights in relation to 3/F, West Wing. He himself admitted that he was invited by Pak Wing to move in and to live there rent free, and after Pak Wing’s death, he had been allowed by Pak Huen to continue to remain there rent free. Tsang clearly knew he was lining there as a guest and in any event clearly not an owner. Pak Wing’s and Pak Huan’s mother was Madam Chan who was one of the executors, so was with Pak Leung and later Daisy. There was no evidence to suggest that any executors had known Tsang to be labouring under any mistaken belief as to his status and/or rights.

94.Seventh, Tsang’s own oral evidence was also unsatisfactory. As pointed out by Mr Fung, although in his affirmation, Tsang was seeking possessory title and/or beneficial interest of 3/F West Wing , during the trial, he had said he could not actually say he had/has ownership but that he had/has a right to reside in the unit. A “right to reside” does not mean ownership. His oral evidence was confusing and not consistent with his written evidence.

G.3  Conclusion on Issue 3 - Tsang’s case

95.Having considered all the evidence, including the above, I find that Tsang has not been able to satisfy this Court of any of his claims.

H.  ISSUE 4 : PROPOSED SALE

H.1  Whether the Family Property should be sold

96.Mr Chan has referred this Court to Foo Jee Seng v Foo Jhee Tuang [2012] SGCA 41, at paragraphs 22-39 and 64[73] which highlights the difference in approaches across jurisdictions when it comes to a trustee exercising its power of sale with the discretion to postpone the same. It is urged upon this Court that the concept of an order for sale should be applied to fit the reality of the situation so that justice is achieved and also giving effect to the testator’s intention. It is submitted by Mr Chan that the intention of the Deceased was to cater for his family, not only his wife and concubines, but also his sons.

97.However, in the Will, the Deceased only expressly stipulated that the Family Property was to be kept and maintained as a family house for the habitation of Madam Leung, Madam Cheung and Madam Chau only[74]. There was no provision in the Will for the Family Property to be kept and maintained as a family house for the habitation of each of the 5 Sons during their life time. There was no evidence that the Deceased had ever intended that the Family Property had to be kept and maintained as a family house for the habitation of each of the 5 Sons, or that it was not to be sold during the joint lives of the 5 Sons. Having considered the provisions of the Will, I do not find that it was the intention of the Deceased that the Family Property be provided as a family home for the 5 Sons for life, or that it should not be sold with vacant possession during their joint lives.

98.Realistically, there appears to be a general decline in property prices in Hong Kong in recent years, but this is not a reason to postpone a sale. No one can foretell when, or if ever, prices will improve.

99.By now, the Deceased died almost 69 years ago, and Madam Chau had passed away for almost 21 years. The Estate has still not yet been wound up. This cannot be fair to other residuary beneficiaries. In my view, there is no reason to further postpone the sale of the Family Property. Nor is there any reason why the Family Property should not be sold with vacant possession.

100.I will however allow Pak Huen and Tsang more time to vacate the respective units occupied and/or used by them, namely on or before 31 July 2024.

I.  THE ORDER

101.I grant an order for sale of the Family Property with vacant possession, and directions as sought by the Administrators save as said above. The Administrators are to submit a draft order for the Court’s approval.

102.Insofar as costs between the Administrators and respectively Michael, Irene, and Cheryl, and the Neutral Ds, I make no order as to costs.

103.As for costs arising out of Pak Huen’s claims, I order Pak Huen to pay the Administrators’ costs and Cheryl’s costs to be taxed on indemnity basis with certificate for two counsel. I make no order as to costs as between Pak Huen and the Neutral Ds, Michael, and Irene.

104.As for costs arising out of Tsang’s claims, I order Tsang to pay the Administrators’ costs and Cheryl’s costs to be taxed on party and party basis, with certificate for two counsel. I make no order as to costs as between Tsang and the Neutral Ds, Michael, and Irene.

105.I will apportion the costs of this application and the trial as to 2/3 being in relation to Pak Huen’s claim and 1/3 being in relation to Tsang’s claim.

106.Any of the Administrators’ costs not covered by the above shall be paid by the Estate on trustee basis, with certificate for two counsel.

107.All the costs orders are on nisi basis, and shall be made final after 21 days.

Mr Eugene Fung SC and Ms Bonnie YK Cheng, instructed by Stephenson Harwood, for the Plaintiffs

Mr Edward Chan SC and Mr Abel Lam, instructed by Chui & Lau, for the 2^nd & 3^rd Defendants

Mr Tommy Cheung, instructed by Raymond Tong & Co, for the 4^th, 5^th, 6^th and 10^th Defendants

The 7^th and 8^th Defendants, unrepresented, appeared in person

Mr Anson Wong SC and Mr Justin Lam, instructed by Withers, for the 9^th Defendant

Ms Lorinda Lau and Mr Forest Fong, instructed by C M Chow & Company, for the 11^th Defendant