Man Kai Kwong, David v. Mak Ying Mui As the Administratrix of the Estate of the Deceased and Others

HCMP 703/2019

[2026] HKCFI 1435

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 703 OF 2019

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D E C I S I O N

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Introduction

1.I have before me an appeal by the Plaintiff (“P”) against the Order of Master Jocelyn Leung (“Master”) of 16 October 2025 inter alia extending time for the 2^nd Defendant (“D2”) to commence proceedings for taxation out of time.

2.At the hearing of the appeal (“the Hearing”), P appeared in person, unrepresented, and Mr So, solicitors, appeared for D2.

Brief Background and Procedural History

3.These proceedings, commenced by Originating Summons dated 19 May 2019 (“OS”), concern the administration of the estate of the late Mr Man For Tai William (“the Deceased”) who passed away on 19 June 2014. P is the eldest son of the Deceased and D2 is the son of the Deceased and P’s younger brother.

4.Under paragraph 1 of the OS, P sought to appoint himself as a co-administrator of the Estate of the Deceased but this was dismissed at the substantive hearing of the OS on 16 December 2020. On 15 July 2021, P obtained leave to amend the OS by inserting paragraph 1A to remove the 1^st Defendant (“D1”), P’s mother, the administratrix of the Estate, and replace her by an independent and professional administrator. The amended OS (“AOS”) together with D2’s application to strike out paragraph 2 of the AOS were substantively heard on 1 December 2022.

5.On 7 December 2022, DHCJ MK Liu handed down judgment dismissing the AOS and struck out paragraph 2 of the AOS (“the Judgment”). A costs order nisi was made against P requiring him to pay the costs of all the Defendants including the costs of D2’s strike out application to be taxed if not agreed (“Costs Order Nisi”).

6.On 20 December 2022, the Defendants took out their respective Summonses to vary the Costs Order Nisi.

7.On 21 December 2022, P took out a Summons to vary the Costs Order Nisi.

8.On 4 January 2023, P served a Notice of Appeal against the Judgment (“P’s Notice of Appeal”).

9.On 24 February 2023, the Costs Order Nisi was made absolute following the dismissal of the parties’ summonses to vary the Costs Order Nisi.

10.On 9 May 2023, the parties entered into a Consent Summons for the dismissal of P’s Notice of Appeal which was approved by the court on 16 May 2023.

11.On 12 May 2023, D2’s solicitors wrote to P’s solicitors making a first without prejudice offer to settle D2’s claim for costs against P. This was rejected by P’s solicitors on 29 June 2023, informing D2 that P had reached settlement on D1’s claims for costs (on 23 June 2023) and counter-offered to settle D2’s costs by the same amount.

12.On 3 July 2023, D2’s solicitors wrote to P’s solicitors rejecting P’s counter-offer and made a second without prejudice offer to P.

13.On 10 July 2023, P’s solicitors rejected D2’s second without prejudice offer and made a second counter-offer to D2 valid to 14 July 2023. On the same day, P had reached settlement with the 3^rd and 4^th Defendants on their costs.

14.On 24 January 2024, D2’s solicitors rejected the second counter-offer and made a third without prejudice offer to P which was rejected on 31 January 2024.

15.On 17 April 2024, formal instructions were sent to a law costs draftsman (“Adrian”) by D2 to prepare a formal bill of costs.

16.On 20 December 2024, a first draft of the bill of costs was sent by Adrian to D2’s solicitors.

17.On 8 January 2025, D2’s solicitors sent their comments to Adrian.

18.On 16 April 2025, the final draft of the bill of costs was sent by Adrian.

19.On 17 April 2025, the final bill of costs was sent to P’s solicitors with an invitation to put forward a reasonable offer to settle the costs by 30 April 2025.

20.On 30 April 2025, P rejected the invitation on the basis that taxation proceedings were already time-barred under O.62, r.22(7) of the Rules of the High Court, Cap. 4A (“RHC”).

21.On 7 May 2025, P’s solicitors informed D2’s solicitors that they have no further instructions to act for P.

22.On 8 May 2025, D2 filed a Summons for extension of time under O.62, r.16 of RHC (“D2’s Summons”).

Applicable Principles

23.It is trite that an appeal from a master to a judge in chambers is dealt with by way of an actual rehearing of the application which led to the order under appeal, and the judge treats the matter as though it came before him or her for the first time: see Hong Kong Civil Procedure 2026, Vol.1, §58/1/2.

24.Furthermore, O.62, r.22(1) of RHC requires a person entitled to payment of costs (receiving party) to commence taxation within 3 months after the completion date.

25.In relation to a costs order made by the Court of First Instance, “completion date” means: (a) the date of the judgment or order of the Court of First Instance which disposes of the action; (b) the date on which the Court of First Instance makes the costs order; or if the order is an order nisi, the date on which the order is made absolute or varied (as the case may be); (c) the date on which the taxing master orders under rule 9D(4) the person entitled to payment of the costs of any interlocutory proceedings in the Court of First Instance to commence taxation proceedings; or (d) where the person entitled to payment of costs is entitled to tax those costs without an order of the Court of First Instance directing the taxation of them, the date on which he becomes entitled to tax those costs, whichever is the later (see O.62, r.22(9) of RHC).

26.O.62, r.22(7) of RHC further provides that a party is not entitled to commence taxation proceedings under rule 21: (a) after the expiry of 2 years from the completion date; or (b) where the Court has extended the period specified in sub-paragraph (a), after the expiry of the period as extended, whichever is the later.

27.In the present case, it was not disputed that the completion date is 24 February 2023 and the two-year period under O.62, r.22(7) of RHC expired on 23 February 2025.

28.However, O.62, r.16 of RHC gives the taxing master the power to extend time to commence taxation proceedings. In Wing Ming Garment Factory Ltd v Incorporated Owners of Wing Ming Industrial Centre & Ors [2012] 1 HKC 290, Recorder Jat SC at §34 held that the Court must take into account all relevant circumstances of the case, rather than being bound by a strait jacket. The absence of a good reason is a relevant consideration, maybe even a compelling reason, why indulgence should be refused. The Court must also give effect to the underlying objectives. In that case, the learned Recorder considered as relevant factors: (a) the length of the delay; (b) whether the delay was due to any deliberate conduct or fault on the part of the receiving party; (c) whether the delay has caused substantial prejudice to the paying party; (d) the effect on the receiving party if an extension of time was not granted; (e) the fact that the taxing master may impose whatever “penalty” under O.62, r.22(5) of RHC including to deprive the receiving party a portion of the costs so taxed to achieve a just result; and (f) whether to refuse the extension would be a wholly disproportionate penalty (see §§38-50).

Discussion and Disposition

29.As already mentioned above, an appeal from a master is a rehearing so I will treat the application as if the matter came before me for the first time. Thus whilst in P’s Skeleton Argument, a number of submissions were made to the effect that the Master’s decision was plainly wrong or the Master had erred or failed to act in accordance with legal principles etc., which were set out as various “grounds”, as I am not bound by the Master’s decision and I will consider the application for extension of time afresh, I do not see the need to deal with those submissions.

30.I therefore proceed to consider whether I should exercise my discretion to extend time in the circumstances of this case having heard all the submissions and considered the evidence placed before me at the Hearing[1].

31.Firstly, in the present case, the relevant period of delay should be calculated from 24 May 2023 being three months from the completion date: see Commissioner of Inland Revenue v Li & Fung (Trading) Ltd (No 2) [2014] 4 HKC 61 per Master Levy (as she then was) at §§14-15 and Hung Fung Enterprises Holdings Ltd & Anor v Agricultural Bank of China [2015] 2 HKC 459 per Master Herbert Au-Yeung (as he then was) at §5. As the application to extend time was filed only on 8 May 2025, there was a delay of nearly 24 months. No doubt this was a very substantial delay. I will take into account the length of the delay.

32.Secondly, there was undue delay. In particular, P complained about D2’s “silence” or inactivity between July 2023 and January 2024 and from January 2024 to 17 April 2024 before sending formal instructions to Adrian totaling 9 months. P rightly did not complain about the period prior to July 2023 when parties were clearly attempting to negotiate for the settlement of cost and there was an outstanding appeal by P so any delay in commencing taxation proceedings was reasonable and excusable.

33.In the 3^rd Affidavit of So Che Wing Rex, he mentioned that prior to the third without prejudice offer in January 2024, D2, as a director of Shenzhen New Fukong Transportation Development Company (“New Fukong”), was preoccupied with handling various urgent matters including negotiation with various parties, bringing proceedings in the Mainland and dealing with arbitration brought by a partner of New Fukong in August 2023. It was also explained in the Affidavit of So Che Wing Rex (paragraphs 14-16) and Adrian’s Affirmation that D2’s solicitors had chased Adrian in November 2024 but as Adrian was recovering from bowel surgery and D2 solicitor’s did not know of the two-year requirement, they did not want to put undue pressure on him and then on 8 April 2025 when D2’s solicitors again chased Adrian for the revised taxation bill, Adrian realized that he had yet to respond to their comments and queries. Adrian only then drew attention to the two-year requirement.  I agree with P that there was undue delay of at least 9 months from July 2023 to April 2024 for which no good explanation was given.  Even taking into account that it has been said on oath that D2’s solicitors did not know of the two-year requirement, and even if D2 is a solicitor, he was not a practising one and cannot be expected to know the procedural rules (but nonetheless he was legally represented), I am of the view that being too busy and ignorant of the rules and procedures of the court are not good excuses for the delay. There was undue delay on the part of D2 for a period of at least 9 months. However, the absence of good explanation for the delay is only one of the relevant consideration (and can be a weighty one) but does not automatically debar relief: see Wing Ming Garment Factory Ltd, §§33-36.

34.Thirdly, I take into account the inaction also on P’s part since July 2023. Whilst P asked rhetorically why would he as the paying party push the receiving party to commence taxation, I am afraid post-CJR, as a party to court proceedings, he has a duty to do so. As held in Commissioner of Inland Revenue, post-CJR, O.1A, r.3 of RHC imposes a duty on parties and their legal advisers to further the underlying objectives and in the event that negotiation of costs fails, parties should take reasonably practical steps in ensuring that taxation proceedings are to be dealt with expeditiously. Whilst the receiving party bears the ultimate responsibility in commencing taxation without delay, the paying party is also required to further the underlying objectives upon the receiving party’s delay by making an application to compel the receiving party to commence taxation under O.62, r.22(3) (see ibid §§42-52 applied in Hung Fung Enterprises Holdings Ltd, §22 and Hong Kong Civil Procedure 2026, Vol.1, §62/22/5). I have not overlooked what was said was in relation to the exercise of the court’s discretion under O.62, r.22(5), but I cannot see why as a matter of principle, it should not also be relevant to the court’s exercise of the discretion under O.62, r.16 of RHC. As held in Wing Ming Garment Factory Ltd, the court should also have regard to the underlying objectives when considering the exercise of discretion to extend time under O.22, r.16. P also submitted that he had not received the bill of costs and would not have known the amount of costs claimed but I cannot see how that prevents him for compelling P to commence taxation in particular when in his own Affirmation (see §§5, 6 and 8) he professed to have knowledge of the relevant time limits prescribed under O.62, r.22 of RHC. The lack of good explanation for not writing further to D2’s solicitors to discuss costs or resorting to O.62, r.22(3) after July 2023, when P was still legally represented, is a factor which I should also take into account.

35.Fourthly, I also take into account the lack of prejudice to P as a result of the delay. P asserted that the delay has financially exhausted him and he can no longer afford a solicitor or law costs draftsman to represent him.  However, the fact of the matter is that when the Costs Order Nisi was made absolute in February 2023, he already had incurred a liability to pay the Defendants’ costs and should have made financial provisions for payment of costs even if the quantum has not been agreed or determined. As to the allegation of RMB32.5M loss from the reduction of the value of the BVI Estate, even on P’s own case it was due to D2’s misfeasance over 12 years and thus cannot be caused by the delay. As for the claim that the delay was calculated to obstruct his efforts to appoint independent administrators to preserve the BVI Estate’s value, according to P, in 2016, he initiated inheritance proceedings against D2 in the Mainland which was unsuccessful and the Chinese courts advised him in 2019 to pursue action in the BVI.  There is no reason given for not doing so back in 2019. It is a bare assertion having the unquantified costs proceedings hanging over his head for 26 months “completely paralyzed” his liquidity and froze the required funding of USD200,000 to fund the BVI administrators. In oral submissions, whilst P alluded to the fact that no bank would lend him money with these proceedings which he wished to have finalized by abandoning his appeal against the Judgment and settling with all the Defendants on costs, he accepted that there is no evidence of him having sought to obtain a loan but was rejected because of these proceedings or the unquantified costs claims against him.

36.Fifthly, I take into account that P’s alleged grievances and prejudice caused by the delay in commencing taxation proceedings can be addressed before the taxing master under the wide powers under O.62, r.22(5) of RHC.

37.Lastly, I also take into account the loss of the right to commence taxation would be a disproportionate penalty in the circumstances of this case.  To deny D2 an extension of time will mean that D2 will be deprived of all the costs which are substantial even taking into account P’s claim that the bill of costs of around HK$2.28M is inflated or extortionate but that is a matter for taxation. It should be borne in mind that O.1A, r.2(2) of RHC provides that in giving effect to the underlying objectives, the Court should always recognize that the primary aim in exercising the powers of the Court is to secure the just resolution of disputes in accordance with the substantive rights of the parties. Even though D2 may have a claim against D2’s solicitors for negligence, if D2 is not granted an extension of time, it would result in further proceedings and use of judicial resources as well as further time and costs incurred by the parties, which is also contrary to the underlying objectives.

38.Balancing all the above matters, I would allow D2’s Summons and make the same Order as the Master. Accordingly, I would dismiss P’s appeal.

39.I see no reason why costs should not follow the event. I will order P to pay to D2 the costs of this appeal to be summarily assessed if not agreed. D2 is to lodge and serve a Statement of Costs within 7 days of the handing down of this decision. P is to lodge and serve any objections to D2’s Statement of Costs within 7 days (limited to 3 pages) and there shall be summary assessment by me on paper.

The Plaintiff appeared in person

Mr Rex So and Mr Johnathan Lam, of Messrs J. Chan, Yip, So & Partners for the 2^nd Defendant