LAU KIN SHUN FREEMAN, Administrator of estate of LAU WAI CHAU, deceased v. MA WAH YAN and WONG CHI LEUNG, co-administrators of the estate of LAU LEUNG CHAU, deceased AND OTHERS

LAU KIN SHUN FREEMAN, Administrator of estate of LAU WAI CHAU, deceased v. MA WAH YAN and WONG CHI LEUNG, co-administrators of the estate of LAU LEUNG CHAU, deceased AND OTHERS

The administrator established that existing and reasonably anticipated liabilities and costs (aggregating approx. $69.27m on the court's assessment) exceed the available compensation (~$45.4m). Given that insufficiency of cash creates a real risk of failing to meet debts and contingent liabilities and there was no...

Source-derived case information.

Citation
[2024] HKCFI 175
Parties
Plaintiff / Administrator De Bonis Non of the Estate: Lau Kin Shun Freeman; Former Administrator of the Estate (deceased) / Former Plaintiff: Lau Yue Kui; Defendants / Applicants for Interim Distribution (1st,3rd,4th in HCMP 3924/1995; 3rd 7th in HCMP 3209/1996): The 5 fongs (applicants); Solicitors and Respondent in Taxation Proceedings / Interested Party: Philip Chan & Co
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
12 January 2024
Case Number
HCMP3924/1995
Procedural Posture
HCMP 3924/1995 and HCMP 3209/1996 (probate/administration / Interim Distribution Summonses) / Hearing of Summonses for Interim Distribution; Summonses Dismissed (decision on Costs Reserved and Costs Order Nisi Made)
Outcome
Summonses dismissed; no interim distribution ordered; Late Affirmation Summons dismissed
Legal Topics
Interim Distribution of Estate Funds, Administrator's Duties and Liability (devastavit), Taxation of Costs, Enhanced/indemnity Interest and Sanctioned Offers, Release and Indemnity for Distributions, Cherry V Boultbee Equitable Principle, Admissibility of Late Evidence
Source Language
en
Probate and Administration Trusts and Estates Civil Procedure Costs Law Property (new Territories) Interim Distribution of Estate Funds Administrator's Duties and Liability (devastavit) Taxation of Costs +4 more

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Parties

Lau Kin Shun Freeman

Plaintiff / Administrator De Bonis Non of the Estate

Lau Yue Kui

Former Administrator of the Estate (deceased) / Former Plaintiff

The 5 fongs (applicants)

Defendants / Applicants for Interim Distribution (1st,3rd,4th in HCMP 3924/1995; 3rd 7th in HCMP 3209/1996)

Philip Chan & Co

Solicitors and Respondent in Taxation Proceedings / Interested Party

Procedural Posture

HCMP 3924/1995 and HCMP 3209/1996 (probate/administration / Interim Distribution Summonses) / Hearing of Summonses for Interim Distribution; Summonses Dismissed (decision on Costs Reserved and Costs Order Nisi Made)

Legal Issues

  1. 1 Whether an interim distribution of government resumption compensation (~$45.4m) should be made to the 5 fongs
  2. 2 Whether the administrator must retain funds to meet existing and contingent liabilities including taxed costs, costs of taxation, enhanced interest and remuneration
  3. 3 Whether the late affidavit (Second Affidavit of Chui Pak Ming Norman) should be admitted

Ratio Decidendi

The administrator established that existing and reasonably anticipated liabilities and costs (aggregating approx. $69.27m on the court's assessment) exceed the available compensation (~$45.4m). Given that insufficiency of cash creates a real risk of failing to meet debts and contingent liabilities and there was no adequate undertaking or security, it was not appropriate to exercise the court's discretion to order interim distribution; accordingly the summonses for distribution were dismissed and the late affidavit was disallowed.

Court Disposition

Summonses dismissed; no interim distribution ordered; Late Affirmation Summons dismissed

Orders

  • The Summonses for interim distribution are dismissed
  • The Late Affirmation Summons filed 11 August 2023 is dismissed