LAU KOON YING MATTHEW v. LAU TARK WING AND OTHERS

LAU KOON YING MATTHEW v. LAU TARK WING AND OTHERS

The court held the Master erred in exercising discretion to award compound interest because there was insufficient evidential foundation to infer that the defendants used the funds in trade or made profits or had put themselves in a position giving rise to a presumption of compound returns; therefore compound interest was replaced with simple interest. Extension of time to appeal was granted (limited to the ground on interest) because delay was excusable due to genuine procedural mistake by appellants' counsel; remaining parts of the Master's Orders (including disallowance of deductions and refusal to credit construction costs) were upheld.

Citation
[2020] HKCFI 2107
Parties
Plaintiff and Executor of the Estate of LAU YIU WING: LAU KOON YING MATTHEW; 1st Defendant (personal): LAU TARK WING; Executor of the Estate of TANG MEI HO (2nd Defendant in Probate Action): LAU TARK WING; Defendant (company): WING HING RESOURCES LIMITED; Defendant (company): CABA RESOURCES LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
21 August 2020
Case Number
HCA2306/2012
Procedural Posture
Appeal From Master's Orders Following Taking of Accounts in Probate and Related Actions / Hearing and Judgment on Extension of Time and Merits in the Court of First Instance (appeal Against Master's Orders)
Outcome
Appeal allowed in part. Extension of time to appeal granted limited to the issue of interest. Compound interest ordered by the Master replaced by simple interest; remainder of the Master's Orders upheld.
Legal Topics
Compound Interest, Taking of Accounts, Extension of Time to Appeal, Surcharge and Falsification, Fiduciary Duty, Interest Commencement, Construction Costs
Source Language
EN
Equity Trusts Probate Civil Procedure Appeals Remedies Compound Interest Taking of Accounts +5 more

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Parties

LAU KOON YING MATTHEW

Plaintiff and Executor of the Estate of LAU YIU WING

LAU TARK WING

1st Defendant (personal)

LAU TARK WING

Executor of the Estate of TANG MEI HO (2nd Defendant in Probate Action)

WING HING RESOURCES LIMITED

Defendant (company)

CABA RESOURCES LIMITED

Defendant (company)

Procedural Posture

Appeal From Master's Orders Following Taking of Accounts in Probate and Related Actions / Hearing and Judgment on Extension of Time and Merits in the Court of First Instance (appeal Against Master's Orders)

Legal Issues

  1. 1 Whether compound (compounded yearly) interest could be awarded instead of simple interest on misapplied trust/fiduciary funds
  2. 2 Whether interest should run from accrual dates (1992/1997) or from commencement of proceedings given delay
  3. 3 Whether construction costs should be credited against sums claimed

Ratio Decidendi

The court held the Master erred in exercising discretion to award compound interest because there was insufficient evidential foundation to infer that the defendants used the funds in trade or made profits or had put themselves in a position giving rise to a presumption of compound returns; therefore compound interest was replaced with simple interest. Extension of time to appeal was granted (limited to the ground on interest) because delay was excusable due to genuine procedural mistake by appellants' counsel; remaining parts of the Master's Orders (including disallowance of deductions and refusal to credit construction costs) were upheld.

Court Disposition

Appeal allowed in part. Extension of time to appeal granted limited to the issue of interest. Compound interest ordered by the Master replaced by simple interest; remainder of the Master's Orders upheld.

Orders

  • Extension of time to file the Notices of Appeal granted (limited to Ground 1)
  • Compound (compounded yearly) interest in the Master's Orders replaced by simple interest