Re Jonathan Crow Qc

HCMP 462/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 462 OF 2012

____________

____________

Before: Hon Cheung CJHC in Court

Date of Hearing: 22 May 2012

Date of Judgment: 22 May 2012

Date of Reasons for Judgment: 29 May 2012

___________________________________

REASONS FOR JUDGMENT

___________________________________

Facts

1.On 22 May 2012, the court refused the application of Mr Jonathan Crow QC for admission to the Hong Kong Bar for the purpose of appearing in three sets of proceedings on behalf of Mr Benjamin Fok before the Court of First Instance pursuant to section 27(4) of the Legal Practitioners Ordinance (Cap 159).  These are the reasons of the court.

2.The three sets of proceedings relate to the estate of the late Mr Henry Fok who died in 2006.  In his will, he appointed his sister (Madam Fok) and two of his sons as executors of the will.  One of the sons is Benjamin Fok and the other one is Mr Ian Fok.

3.In gist, Benjamin Fok says that the estate of the deceased, which is huge in value, comprises, amongst many other properties and assets, 350 out of 750 ordinary shares in a major property holding company (Henry Fok Estates Limited) which comprises at least 27 subsidiaries and associated companies; a number of offshore companies set up by the deceased during his lifetime which in turn hold substantial assets; and various offshore bank accounts maintained by the deceased during his lifetime, some of which were maintained in the joint names of the deceased and Ian Fok.  Benjamin Fok alleges that these assets all belonged to the deceased absolutely and beneficially before he died and they now belong to the estate.  He complains that Ian Fok, on the other hand, has been maintaining that these assets belong beneficially to him, rather than the estate.

4.In those circumstances, in HCA 2155/2011 (the removal action), Benjamin Fok seeks the removal of Ian Fok as executor of the estate on a number of grounds including conflict of interest in acting as an executor whilst asserting claims against the disputed assets.  He also seeks the removal of Madam Fok as executor because of her old age and the fact that she has not played any role in the administration of the estate. 

5.The other beneficiaries (essentially family members of the deceased) have been named as co-defendants in the proceedings in order to be bound.

6.On 14 March 2012, Benjamin Fok took out an Order 14 application for the removal of Ian Fok and Madam Fok as executors.  He also sought the appointment of Mr Anthony Rogers QC as a judicial trustee.  Hearing of the applications has been fixed for 31 July 2012 (3 days reserved) before Poon J, the probate judge.

7.In HCA 569/2012 (the recovery action), Benjamin Fok as executor seeks to recover on behalf of the estate the various assets in question which Ian Fok claims to be his own.  Apart from Ian, another brother (Timothy Fok), as well as Madam Fok and a family company, are also joined as co-defendants.

8.The action is at its early stage.  The writ was only issued on 10 April 2012 and pleadings have not closed.

9.In HCMP 2621/2011 (the Beddoe application), Benjamin Fok seeks the court’s sanction to pursue the removal action and the recovery action.  Apart from Ian Fok and Madam Fok, the other beneficiaries under the will are also joined as defendants.  No substantive hearing has yet been fixed but a directions hearing has been scheduled for 31 May 2012.

10.The application for admission was opposed by the Bar.  The Secretary for Justice did not find himself able to support the application either. 

Arguments

11.Mr Godfrey Lam SC (Mr Eugene Fung SC with him) contended that the application was supportable on the ground of unusual difficulty and complexity in both law and fact.  It was also submitted that the issues raised would have an impact on local jurisprudence.  It was further submitted that the three sets of proceedings should not be viewed as entirely separate suits but as facets of a major piece of litigation involving the deceased’s estate. 

12.Mr Lam contended that the deceased had, for tax and other reasons, arranged his affairs and assets in a complicated manner, and many corporate vehicles and offshore companies were involved.  Due to the uncooperative attitude of Ian Fok, Benjamin Fok had expanded great efforts in collating the necessary materials and information to build his case against Ian Fok.  The proceedings raised issues which involved highly complex facts and voluminous documents.  The matter was made more complicated by the involvement of so many beneficiaries and the different stances that many of them took.

13.As for the legal issues, counsel submitted that various difficult and even novel issues would be involved and they would have to be resolved against the difficult and complex background facts.  In the removal action, the application of the principles governing section 33(3) of the Probate and Administration Ordinance (Cap 10) to the complex facts of the present case would be difficult and there is a lack of local authority on application of the section for the removal of personal representatives on the ground of conflict of interest, or indeed on other contested grounds.  Counsel also submitted that the application of the principles in section 63 of the Trustee Ordinance (Cap 29) to the complex facts of the present case for the appointment of judicial trustee would also be difficult, particularly when there is a paucity of Hong Kong authorities on section 63.

14.Counsel further submitted that the input of an experienced leading counsel from London would be required to ward off Ian Fok’s cross application to stay the removal action pending the determination of the recovery action as it would require such an experienced and skillful counsel to “distil the relevant issues and to ensure that the Court’s attention is focused on the grounds for the removal … and not distracted by the immaterial issues that Ian will seek to introduce” (paragraph 61 of counsel’s skeleton submission).

15.Regarding the recovery action, counsel submitted that difficult principles of law relating to purchase money resulting trust, common intention constructive trust and the presumption of advancement would be involved.  The matter was further complicated by the involvement of overseas companies and bank accounts, rendering the application of those principles “unusually difficult”.  There would also be legal issues raised in relation to the claim that Ian Fok might make in relation to the circumstances under which allegedly he became the sole doneeof the disputed assets, the admissibility of his evidence and so forth.  Furthermore, the now repealed section 6(1)(c) of the Law Amendment and Reform (Consolidation) Ordinance (Cap 23) governing the formality for the disposition of an equitable interest would also be involved. 

16.As for the Beddoe application, counsel submitted that the court would be assisted by the applicant in explaining to it the merits of the removal action and the recovery action.  Counsel emphasised on the large number of family members and parties involved; the fact that many of them have differing and conflicting views as to the relief sought by Benjamin Fok; the size and complexity of administration of the estate; the very complex events which have taken place amongst the family members since the death of the deceased; and the complex issues of law which would arise in both the removal action and the recovery action, to say that the Beddoe application was itself an unusually difficult and complex application.

17.Counsel also pointed out that if admitted, the applicant would appear for Benjamin Fok together with Mr Lam and Mr Fung (except that Mr Lam would not be available for the Order 14 hearing).  That would be good for the cross-fertilisation of counsel, which is in the public interest.

18.Ms Winnie Tam SC (Mr David Chen with her) for the Bar disputed that the proceedings would raise any unusually difficult or complex issues of fact or law.  They also contended that the proceedings would not involve any determination of legal principle which might substantially impact the development of local jurisprudence.  They concluded that public interest does not demand the admission of the applicant. 

19.The Secretary for Justice also queried the grounds relied on by the applicant. 

General principles

20.The general principles governing the admission of overseas counsel are well established: Re Flesch QC [1999] 1 HKLRD 506; Re McGregor QC [2003] 3 HKLRD 585.  In short, the burden is on an applicant for admission to satisfy the court that it is in the public interest to grant the admission.  In considering an application for admission, the court adopts a flexible and sensible approach, balancing different aspects of the public interest.  Different facets of the public interest include: the need to have a strong and independent local Bar; the need of Hong Kong people to have adequate representation and the need for the local courts to develop our own jurisprudence which enjoys international recognition and reputation. Overseas counsel with sufficiently high quality and standing may be admitted to appear in our courts in cases involving the determination of legal principles which may have an impact on the development of our jurisprudence.  Local counsel’s exposure to cross-fertilisation between lawyers of sufficiently high quality and standing from other common law jurisdictions is considered to be helpful and conducive to the maintenance of a strong and independent local Bar. Admission of overseas counsel is not limited to hearings before the Court of Final Appeal or even the Court of Appeal.  The same basic approach applies to all hearings, irrespective whether the hearings are final or interlocutory: Re Mostyn QC, HCMP 3552/2003, 17 September 2003 (Ma CJHC), para 10.

My view

21.I am not satisfied that the grounds put forward in support of the application for admission have been made out.  I am not satisfied that the proceedings would involve issues of “unusual” complexity or difficulty.  Nor am I satisfied that they would be issues having a substantial impact on local jurisprudence. 

22.Regarding the facts, I can certainly see that many documents would be involved and the facts are not straightforward.  Nonetheless, the use of corporate vehicles and overseas companies for commercial or assets holding purposes, or for the purpose of tax or estate planning, is not anything new.  Cases involving these arrangements come to court all the time.  There are many civil practitioners who are experienced enough to deal with, and who have indeed dealt with, this sort of factual situation. Benjamin Fok is represented by extremely competent and experienced local counsel in the present case.  In my view, they are more than equal to the task facing them in the proceedings in question.  There is no suggestion that apart from Mr Lam and Mr Fung (in case they are not available for a particular hearing), no other local silks are available to represent Benjamin Fok.

23.My view is confirmed by the fact that Benjamin Fok has indeed taken out an application for summary judgment in the removal action, no doubt upon the advice of his lawyers (including the applicant).  It is trite that in an Order 14 application, unless the facts are agreed or uncontrovertible and do not give rise to any triable issue, no summary judgment can be obtained.  Benjamin Fok’s application for summary judgment is in fact an admission from his side that the facts involved cannot be as unusually complex or difficult as was submitted to the court in this application for admission.

24.It is true that even in an Order 14 application, the court will, on suitable occasions, be prepared to decide complicated and difficult questions of law: European Asian Bank AG v Punjab & Sind Bank (No 2) [1983] 1 WLR 642, 654B-E; RG Carter Ltd v Clarke [1990] 1 WLR 578, 584E-H.  But this is only where the facts are not in dispute and do not give rise to any triable issue.  So contrary to Mr Lam’s submission, I do find the taking out of an application for summary judgment by Benjamin Fok quite inconsistent with the claim in the present application for admission that unusually complicated and difficult issues of facts (and law)are involved.

25.Turning to the issues of law, the legal issues outlined by counsel may not be very straightforward.  One or two of them may not be covered by any direct authority.  But this is not to the point.  The question is whether they are unusually difficult or complex point of law.  I do not think so.  Purchase money resulting trust, common intention constructive trust, presumption of advancement, to mention a few as examples, are legal issues encountered in the local courts from time to time. The courts, as well as many local counsel, have had experience in dealing with them.  Section 33 of the Probate and Administration Ordinance is resorted to not infrequently in the Probate Registry and before the probate judge (I have had the benefit of sitting as the probate judge for several years) and from experience, issues raised are basically facts sensitive in nature.  By the same token, I fail to see how the appointment of a judicial trustee, rare though it may be, is such an unusually difficult or complex matter that requires the service of a London silk. 

26.In relation to the recovery action, it should be noted that it is at a very early stage.  Pleadings have not closed.  If nothing else, the present application for admission is premature.  This is particularly so when nowadays, obtaining opinions and advices from London via electronic means is much more convenient than before.  One can certainly worry about the trial (or, indeed, any subsequent appeal(s)) later when the picture should, hopefully, become clearer.

27.As for the Beddoe application, I would repeat that Mr Benjamin Fok is already represented by extremely experienced and competent local counsel.  In my view, they are more than able to explain the merits of the removal action and recovery action to the court.  If any assistance or input from the applicant is required, that can be easily done by means of a written opinion from London, which can be placed before the judge hearing the application.

28.I perfectly understand the point on cross-fertilisation. But it assumes secondary importance when the applicant has failed to satisfy the court that the issues likely involved in the proceedings are of unusual complexity or difficulty, or that his appearance could add a significant dimension to the proper resolution of the issues.

29.All this leaves the facts that these are high profile proceedings which are likely to attract media attention; the size of the estate is huge; a retired Vice President of the Court of Appeal has been asked to act as executor or judicial trustee; the number of beneficiaries involved is substantial; as well as the wish of Benjamin Fok to be represented by counsel of his own choice, to name some of the miscellaneous considerations urged upon the court.  I do not think that in the overall context of this case, they are sufficient to tilt the balance in favour of admission.

Outcome

30.For those reasons, the application for admission was refused, but without prejudice to any future application for admission that may be made in relation to any of the proceedings in question.

31.I thank counsel for their assistance.

Mr Godfrey Lam SC and Mr Eugene Fung SC, instructed by Norton Rose Hong Kong, for the applicant

Ms Winnie Tam SC and Mr David Chen, instructed by Anthony Chiang & Partners, for the Hong Kong Bar Association

Ms Leona Cheung SGC, of the Department of Justice, for the Secretary for Justice