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Fok Chun Yue Benjamin v Fok Chun Wan Ian And Others

Judgment Cited authorities 14 Cited in Precedent Map Related
Vincent
Judgment Date03 January 2014
Subject MatterCivil Action
Judgement NumberHCA2155/2011
CourtHigh Court (Hong Kong)
HCA2155/2011 FOK CHUN YUE BENJAMIN v. FOK CHUN WAN IAN AND OTHERS

HCA 2155/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 2155 OF 2011

_______________

BETWEEN
FOK CHUN YUE BENJAMIN
(in his capacity as a co-executor of the estate of Fok Ying Tung Henry, deceased and in his personal capacity)		 Plaintiff

and
FOK CHUN WAN IAN
(in his personal capacity and as an executor of the estate of Fok Ying Tung Henry, deceased)		 1st Defendant
FOK MO KAN
(in her capacity as co-executrix of the estate of Fok Ying Tung Henry, deceased)		 2nd Defendant
FOK LAI PING PATRICIA 3rd Defendant
FOK TSUN TING TIMOTHY 4th Defendant
FOK LAI LOR NORA 5th Defendant
FOK LAI LAI LILY 6th Defendant
FOK MAN BUN NELSON 7th Defendant
MANSON FOK 8th Defendant
FOK MAN FONG THOMAS 9th Defendant
FOK HIN YEUNG DAVID 10th Defendant
FOK HIN SUEN DONALD 11th Defendant
FOK HIN KWONG DANNY 12th Defendant
FOK HIN KEUNG MICHAEL 13th Defendant
FOK LUI YIN NEI 14th Defendant
FOK FUNG KIN NEI ELAINE 15th Defendant
PERSONAL REPRESENTATIVE OF THE ESTATE OF LAM SOOK DUEN,DECEASED 16th Defendant
_______________
Before : Hon Poon J in Chambers
Dates of Hearing : 28-31 October, 1 & 4 November 2013
Date of Decision : 3 January 2014

______________

D E C I S I O N

______________

1. This is the Decision on the Stay Applications[1].

A. INTRODUCTION

A1. Mr Fok and his families

2. Mr Henry Fok Ying Tung (“Mr Fok”) was a legendary figure. An extremely successful businessman, a prominent politician and a generous philanthropist, he was well known both in Hong Kong and the Mainland.

3. Mr Fok died on 28 October 2006 at the age of 83. He was survived by 3 families :

(1) The First Family consisting of his first wife Madam Fok Lui Yin (“the Mother”)[2] with 5 children (“the First Family Siblings”), Madam Fok Lai Ping Patricia (“Pat”)[3], Mr Fok Tsun Ting Timothy (“Tim”)[4], Mr Fok Chun Wan Ian (“Ian”)[5], Madam Fok Lai Lor Nora (“Nora”)[6] and Mr Fok Chun Yu Benjamin (“Ben”)[7];

(2) The Second Family consisting of his second wife Madam Fok Kin Nei Elaine[8] with four children, Madam Fok Lai Lai Lily[9], Mr Fok Man Bun Nelson[10], Mr Manson Fok[11], and Mr Fok Man Fong[12];

(3) The Third Family consisting of his third wife Madam Lam Sook Duen[13] with four children, Mr Fok Hing Yeung David[14], Mr Fok Hin Suen Donald[15], Mr Fok Hin Kwong Danny[16] and Mr Fok Hin Keung Michael[17].

A2. Mr Fok’s will

4. By his last will dated 20 May 1978 (“the Will”), Mr Fok appointed his sister, Madam Fok Mo Kan (“the Aunt”)[18], her husband Mr Choy Yuen Lam (who had predeceased Mr Fok on 8 June 1993), Ian and Ben to be the executors and trustees of his vast estate (“the Estate”). He left to each of his wives and children specific pecuniary legacies. He directed his trustee to make fixed monthly payments out of the residuary estate to each of his wives and children with power and discretion to make changes and adjustments to the amount of the monthly payments to take into consideration changes in the cost of living at intervals as the trustees think fit. He further directed his trustees to hold his residuary estate for 20 years from the date of his death upon trust, inter alia, to pay or apply the income or capital thereof to or for the benefit of all or such one or more of the living beneficiaries in such shares and in such manner as the trustees shall in their absolute discretion think fit.

5. On 10 May 2007, probate of the Will was granted to the Aunt, Ian and Ben as the surviving co-executors.

A3. The proceedings commenced by Ben

6. On 19 December 2011, Ben commenced the present action, HCA 2155/2011, in his dual capacity as an executor and a beneficiary of the Estate to remove the Aunt and Ian as executors of the Estate and consequential relief. In gist, Ben complained that Ian had misappropriated the Disputed Assets, namely, 350 ordinary shares of HK$1,000 each in Henry Fok Estates Limited (“HFE”) registered in the name of Waterborne Company Limited (“Waterborne”); the entire shareholding in three offshore companies and their assets; and the monies held in three specified joint offshore accounts with Mr Fok (“the JAOS Funds”). Ian has acted in breach of his duties and an executor because, inter alia, he has placed himself and allowed himself to remain in a position of conflict between his personal interests and his duties to the Estate, unilaterally appropriated to himself assets belonging to the Estate without the knowledge or consent of his co‑executors, and obstructed the administration of the Estate. Separately, Ben alleged that the Aunt, who is in her 80s, is not in good health. Other than obtaining the grant, she has not played any role in the administration of the Estate since Mr Fok’s death. Ben has tried to involve her in the administration of the Estate with no avail. The administration of the Estate has become unworkable and cannot be concluded for so long as the Aunt remains an executrix. Ben joined the Mother, other siblings of the First Family and members of the Second and Third Families as they are all beneficiaries of the Estate but does not seek any relief against them.

7. On the same day, Ben commenced another action, HCMP 2621/2011, which is a Beddoe application.

8. On 10 April 2012, Ben commenced HCA 569/2012 against Ian, Tim, the Aunt and Waterborne to recover the Disputed Assets.

9. I will refer to the three actions commenced by Ben as “the Proceedings” collectively below.

A4. The Order 14 Application

10. By summons dated 14 March 2012, Ben applied for summary judgment to, inter alia, remove Ian and the Aunt as executors of the Estate and to replace them by Mr Anthony Rogers, GBS, QC, JP, formerly Vice President of the Court of Appeal (“the Order 14 Application”). It was fixed before me on 31 July 2012 with 3 days reserved. The hearing was however adjourned a few times to enable the parties to discuss settlement. Eventually, they and some other non-parties (31 in total) reached a global settlement agreement in writing dated 3 August 2012 (“the Settlement Agreement”).

11. Pursuant to Clause 48 of the Settlement Agreement, the hearing of the Order 14 Application was adjourned for 6 months. In the event, the adjourned hearing was fixed before me on 9 April 2013. At that hearing, Mr Winston Poon, SC, for Ben, informed the court that principally because Ian and Tim refused to honour Clause 19(e) of the Settlement Agreement which concerns the Yau Wing Option[19], Ben had decided to apply to restore and proceed expeditiously with the Order 14 Application; and that Ben would no longer act on the Settlement Agreement lest his position in the Order 14 Application might be prejudiced. Mr Patrick Fung, SC, for Ian and Mr Victor Dawes, for Tim, indicated that they might wish to take a preliminary objection to Ben’s application to restore the Order 14 application based on the Settlement Agreement. I then gave directions for future conduct and adjourned the hearing to 28 October 2013 with 5 days reserved.

A5. The Stay Applications

12. By summons dated 3 July 2013, Ian applied for :

“(1) An order that this Action and all further conduct of the proceedings herein be stayed, save for the purpose of perfecting and implementing [the Settlement Agreement], as to which there shall be liberty to apply; (‘Para 1’)

(2) Alternatively, an order that [the Order 14 Application] be stayed; (‘Para 2’)

(3) Further and/or alternatively, such further or consequential orders as the Court may deem fit and/or appropriate; (‘Para 3’)”

13. On 9 July 2013, the Aunt took out a similar summons for stay. I will refer to two stay applications collectively as “the Stay Applications” below[20].

14. Ian contends that the Settlement Agreement is a legally binding multi-party global settlement which is much wider than and includes a compromise of the present action. It entails multi-reciprocal obligations on the parties. It affects fundamentally the executors’ duties. It is still afoot, substantial parts have been performed, with everybody still keeping the fruits received under it so far. Accordingly, there is no basis for revival of the Order 14 Application. The present action or alternatively the Order 14 Application must be stayed, save for the purpose of perfecting and implementing the Settlement Agreement.

15. The Aunt basically adopts Ian’s contentions above. She further argues that her stay application must be allowed anyway when, as will be seen in a moment, Ben still holds the Settlement Agreement good vis-à-vis her.

16. The Stay Applications are supported by Tim, the Mother and members of the Second and Third Families. Tim does so as a matter of principle. Although he would personally benefit by Ben’s case on the Yau Wing Option, he firmly believes that it is unmeritorious. The Mother is greatly disappointed and saddened by Ben’s refusal to abide by the Settlement Agreement and his application to re-open the Order 14 Application. She hopes the Settlement Agreement could be implemented in full and her children (the First Family Siblings) could resolve their disputes amicably without bothering the court. The Second and Third Families are caught innocently in the cross-fire between the two warring camps of the First Family Siblings. What they want is the full implementation of the Settlement Agreement as expeditiously as possible.

17. Pat adopts a neutral position with respect to the Stay Applications.

18. Nora joins Ben in opposing the Stay Applications. They dispute the court’s jurisdiction to order a stay based on the Settlement Agreement. Ben further contends that Ian and Tim are in repudiatory...

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