High Court · Decided 10 April 2015

Chiang Shirley v Chiang Dong Pheng

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[2015] SGHC 98Case no. Suit No 524 of 2011

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Grounds of decision

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Judith Prakash J:
Introduction
[1] In this involved and strenuously fought out matter, a sister is challenging her brother’s right and suitability to be the executor and trustee of their mother’s estate. As this is a family dispute, the sad fact is that it covers years of disagreement, hurt feelings and actions taken by one or another sibling in respect of their parents and each other which have engendered deep-felt animosity. Thus, to decide the issues in the case, there would have to be a rather thorough exploration of family history and issues of the kind that most people prefer to keep securely locked away from public view.
[2] This action concerns the estate (“the Estate”) of Mrs Chiang Chia Liang nee Ho Fan Ching Florence (“Mdm Ho”). Mdm Ho and her husband, the late Mr Chiang Chia Liang (“Mr Chiang”) had three children. The first child, a daughter, Dr Currie Chiang (“Dr Chiang”) is an ophthalmologist by profession. The second child, another daughter and a trained accountant, is Shirley Chiang, the plaintiff in this action. The youngest child and only son is Chiang Dong Pheng, the defendant in this action.
[3] Under Mdm Ho’s will, the defendant was appointed to be the executor of the will and trustee of the Estate. The plaintiff contends that the defendant is unfit to be executor and would like the court to remove him and appoint her as executrix in his place.
Background
General details about the Chiang family
[4] Mr Chiang was an engineer from Taiwan who became a successful businessman with companies in the chemical business in Singapore and Malaysia. Mdm Ho and his children were officers of these companies at various times. As Mr Chiang grew older and played less part in the business, the defendant took over his role. He has worked for the family company, Standard Chemical Corporation Pte Ltd (“SCC”), for over 30 years and has been its managing director since 1988. The defendant is also the managing director of the family’s property company, Chiang Properties Pte Ltd (“CPPL”).
[5] Mdm Ho was a housewife and mother. She did not run any of the Chiang family companies but she managed the family’s finances and acquired various properties for the family. She looked out for opportunities to invest and increase the wealth of the family. She was a very capable woman and managed almost all the family’s investment properties, keeping them tenanted and collecting rental.
[6] Sometime in the 1980s, Mr Chiang, while remaining married to Mdm Ho, moved out of the family residence and set up a new home with his mistress, one Ms Wen Jen Jiao (“Ms Wen”). A son was born out of this relationship. Mr Chiang bought two apartments in Singapore in the name of Ms Wen and resided in one of these with her and their son. According to the defendant, Mdm Ho, although understandably very upset, accepted the situation and concentrated thereafter on protecting the family wealth by making sure all money and other assets were kept out of Mr Chiang’s reach for fear that he might otherwise be pressured into transferring the same to Ms Wen.
[7] Between them, Mr Chiang and Mdm Ho owned eight houses and apartments in Singapore. They are the following:
Properties in the joint names of Mr Chiang and Mdm Ho
(a) 5 Harlyn Road (“5 Harlyn”);
(b) 68 Oriole Crescent (“68 Oriole”);
(c) 70 Oriole Crescent (“70 Oriole”); and
(d) 72 Oriole Crescent (“72 Oriole”).
Properties in the sole name of Mr Chiang
(e) 33 Merryn Road (“33 Merryn”); and
(f) 17C Dublin Road (“17C Dublin”);
Properties in the sole name of Mdm Ho
(g) 17B Dublin Road; and
(h) 151 Cavenagh Road, #08-165 (“151 Cavenagh”).
The Chiang family home was 5 Harlyn. Mdm Ho remained there after Mr Chiang moved out. The other properties were bought as investments and, accordingly, were kept tenanted as much as possible.
Events from 1998 to 2009
[8] In 1998, Mr Chiang had a terrible fall. Thereafter, his health deteriorated. Sometime in 2002, Mr Chiang moved to live with the defendant in the latter’s home at 27 Merryn Road. At that time the plaintiff lived next door at 27A Merryn Road.
[9] In March 2002, Mdm Ho, the defendant and Dr Chiang made an application (“OS 936”) under the Mental Disorders and Treatment Act (Cap 178, 1985 Rev Ed) for an order in respect of the person and estate of Mr Chiang. Medical evidence was produced that Mr Chiang was suffering from dementia and did not understand what was happening around him and was not able to look after himself and his affairs. The defendant initially objected to the application but subsequently wanted to become a member of the Committee. On 14 August 2002, an order was made in OS 936 appointing Mdm Ho and all her children to be the committee of the person and estate of Mr Chiang (“the Committee”). The order specifically empowered the Committee to do the following:
(a) To operate Mr Chiang’s current account No 01-4xxx with Overseas Union Bank;
(b) To execute, on behalf of and in the name of Mr Chiang, certain documents which he had to sign to apply for replacement share certificates in his name;
(c) To execute, on behalf of Mr Chiang, all documents relating to utilisation of his CPF savings; and
(d) Generally, to manage his personal and real property.
[10] Mr Chiang died on 26 June 2009. By his will, which he had made in June 1994, Mr Chiang made the following appointments and gifts:
(a) He appointed Ms Ong Chai Hong (“Ms Ong”), a former employee of SCC, to be the executrix and trustee of his will.
(b) He bequeathed his shares in SCC to his wife and children as follows:
(i) 50 shares to Mdm Ho;
(ii) 700 shares to the defendant;
(iii) 2,140 shares to Dr Chiang; and
(iv) 2,140 shares to the plaintiff.
(c) In respect of his real properties, he made the following specific gifts:
(i) 17C Dublin was given to Mdm Ho; and
(ii) 33 Merryn was given to Ms Wen.
(d) Finally, he gave all his other real and personal property to Mdm Ho and his three children in equal shares.
[11] Mdm Ho died some two months later on 18 August 2009. By her will made on 27 May 2004, she made the following appointments and bequests:
(a) She appointed the defendant to be the sole executor and trustee of her will.
(b) She gave her children the following houses:
(i) To the defendant, 5 Harlyn and 70 Oriole;
(ii) To Dr Chiang, 72 Oriole; and
(iii) To the plaintiff, 68 Oriole.
Each of these gifts was expressed to be “of all my interest … absolutely”.
(c) She gave all her other property to her trustee to call in and sell and convert into money and thereafter to apply the proceeds in the following manner and priority:
(i) To pay all her debts and funeral expenses;
(ii) To pay “all outstanding loans secured by” 70 Oriole and 72 Oriole; and
(iii) To divide and distribute the residue after the aforesaid payments equally among her three children.
[12] A number of events took place after Mdm Ho’s death in which the plaintiff and either one or both of her siblings were involved which led to an intensification of the strained relationship between the plaintiff and her siblings. I will deal with these when I discuss the issues in the case in more detail. In the meantime, I turn to the various legal proceedings and applications that the parties have been involved in prior to this litigation.
Initial actions
[13] No steps were taken by the defendant in the months following Mdm Ho’s death to apply for probate of her will. The plaintiff was not happy with this inaction. On 6 April 2010 and 2 July 2010, her solicitors wrote to the defendant’s solicitors for information relating to the Estate and the status of the probate proceedings. No reply having been received to either letter, on 15 July 2010, the plaintiff gave the defendant notice that if he did not commence probate proceedings within 14 days she was going to make an application to court. There was no response to this letter either.
[14] In early September 2010, the plaintiff filed caveats against the grant of probate in the Estate in both the Supreme Court and the Subordinate Courts. Subsequently, on 27 September 2010, she filed a Citation to Accept or Refuse Grant of Probate (“the Citation”). The Citation was served on the defendant personally.
[15] She followed this up by starting Originating Summons No 1088 of 2010 on 21 October 2010 (“OS 1088”). This application was for an order that the defendant produce the will of Mdm Ho and deposit the same in the Civil Registry of the Supreme Court. In the affidavit supporting the application, the plaintiff complained that the defendant had done nothing in the 14 months since Mdm Ho’s death. He had not entered an appearance to the Citation and had not taken probate action. The plaintiff stated that she had been advised that the defendant was deemed to have renounced his right to probate under s 4 of the Probate and Administration Act (Cap 251, 2000 Rev Ed) (“the Probate Act”) and that she was therefore entitled to apply for a grant of Letters of Administration with Will Annexed under s 13 of the Probate Act. For this purpose she wanted the will to be produced and deposited in the Civil Registry of the Supreme Court.
[16] On 11 November 2010, the defendant filed Probate No 309 of 2010 (“P 309”) in the Supreme Court. This was his application for probate to be granted to him in respect of Mdm Ho’s will. Some two weeks later, he filed an appearance to contest the plaintiff’s Citation proceedings and also filed a warning for the removal of the caveats lodged by the plaintiff.
Suit 820 of 2012
[18] Suit No 820 of 2012 (“S 820”) was an action started by Mdm Ong who had obtained grant of probate in respect of Mr Chiang’s estate (“the Chiang Estate”) on 20 October 2010. There were five defendants to S 820: the three Chiang siblings in their personal capacities, Chiang Dong Pheng as personal representative of the Estate, and Ms Wen. The action was taken out in order to determine the assets belonging to the Chiang Estate. The orders sought by Mdm Ong were:
(a) An order for certain shares and deposits to be included in the Amended Schedule of Assets to be filed with the court;
(b) An order for Chiang Dong Pheng and the Estate to disclose how much each of them and Mr Chiang had contributed to a deposit identified as “Deposit A” and following from that a declaration regarding the amount in Deposit A to be attributed to the Chiang Estate;
(c) An order for Chiang Dong Pheng and the Estate to disclose how much each of them and Mr Chiang had contributed to a deposit identified as “Deposit B” and following from that a declaration regarding the amount in Deposit B to be attributed to the Chiang Estate;
(d) Various orders in relation to the debts owing by the Chiang Estate to CPPL and in relation to loans recovered by banks from Deposit A and Deposit B; and
(e) A declaration regarding the validity of cl 5 of the will of Mr Chiang.
This action came on for hearing in 2014 and part way through the trial the parties came to a settlement and a consent judgment was entered on 2 July 2014. The Chiang Estate was represented throughout by Aequitas Law Corporation (“Aequitas”).
The present proceedings
[19] The present proceedings were started by the plaintiff on 28 July 2011 as a consequence of the earlier order in P 309. The main reliefs claimed by the plaintiff are as follows:
[20] The plaintiff has represented herself since the start of this litigation. She has drafted and filed all her own pleadings and affidavits. When the case came to trial, she conducted the cross-examination of the defendant and his witnesses herself. Due to the fact that the plaintiff is not a lawyer, although she obviously spent a lot of time researching the law and preparing her case, there were occasions on which irrelevant matters were brought up in court. Some of these matters have also been brought up in her closing submissions. In order to be fair to the defendant therefore, I think it important to emphasise that in dealing with this case and considering the plaintiff’s allegations, I will only deal with and consider those allegations that were pleaded in the statement of claim. Any unpleaded allegations would not be relevant in determining whether the plaintiff is entitled to the relief that she has claimed.
[21] Moving to the statement of claim, the plaintiff amended this twice. The second amendment was filed on 4 January 2012. The essence of the plaintiff’s case resides in her allegation in para 3 that it is inappropriate for the defendant to be appointed sole executor of the Estate because: (i) he has acted in breach of fiduciary duty and trust; (ii) he is in conflict of interest in the administration of the Estate; and (iii) he has failed to administer the Estate on a timely basis and in the best interest of all beneficiaries.
[22] The rest of the statement of claim which follows the heading “PARTICULARS” is an elaboration of her specific complaints about the defendant’s behaviour. I summarise those complaints contained in paras 4 to 19 of the statement of claim as follows:
(a) The defendant has diverted funds belonging to the Estate into his own personal Post Office Savings Bank (“POSB”) Account;
(b) The plaintiff was not informed of the banking of the Estate’s funds into any interim account and the defendant was in breach of his duty to inform and consult beneficiaries in relation to the diversion;
(c) The defendant transferred moneys out of Mr Chiang’s POSB Account 009-xxx into a joint account in the names of himself and Mdm Ho in breach of a High Court order;
(d) There is a conflict of interest in respect of the review of transfers out of the joint accounts of the defendant and Mdm Ho to Mr Chiang’s bank account;
(e) The defendant closed two joint accounts which he held with Mdm Ho before probate had been obtained;
(f) The defendant showed no interest in taking out probate until the plaintiff commenced OS 1088 to compel him to deposit the will;
(g) The defendant failed to provide information to the beneficiaries and to prepare and provide timely and accurate accounts;
(h) There was an inordinate delay in taking out probate with no acceptable reason being given for the delay;
(i) There was a loss in value of investments as a result of lack of review;
(j) The defendant failed to consult the plaintiff as a beneficiary and failed to act in accordance with his own written assertion in regard to the renewal of the tenancy of 68 Oriole;
(k) The plaintiff lost an opportunity to sell her home at 27A Merryn Road due to the defendant’s delay in handing over 68 Oriole to her;
(l) The defendant has used moneys belonging to the Estate to make interest repayments in respect of a loan which was ostensibly made to CPPL but which was used by the defendant as collateral for a loan to another company;
(m) Two of the family companies under the directorship of the defendant are doing badly;
(n) The defendant and Dr Chiang have denied having any documents in relation to a huge piece of land in China in which the plaintiff has an interest as a beneficiary of the Chiang Estate and the Estate;
(o) The defendant had acted as “executor de son tort” in the Chiang Estate even though that estate had its own executor; and
(p) The defendant had failed to provide the plaintiff with an updated Schedule of Assets of the Estate even though the plaintiff had advised him that his draft Schedule of Assets dated September 2009 was incomplete.
[23] The defendant responded by not only filing a defence but also by making a counterclaim. In the defence proper, the defendant denied the plaintiff’s various allegations and gave his explanation for the various steps that he had taken which he asserted had been either in compliance with directions from Mdm Ho or had been in the best interests of the Estate. He also made certain allegations regarding the plaintiff’s motivation and alleged ill intentions and certain actions that she had taken.
[24] The defendant’s counterclaim is based on his averment in para 26 of the same that, at various dates from the deaths of her parents, the plaintiff has taken various actions and steps which are detrimental to the Estate. Such matters have caused unnecessary delay, expense and distress to the defendant as executor of the Estate and to the defendant and Dr Chiang as beneficiaries of the estates of Mr Chiang and Mdm Ho. This averment is supported by the following pleaded “PARTICULARS”:
(a) Instigating a legal action in Taiwan by contacting and informing Ms Wen of Mr Chiang’s death;
(b) Making various unfounded police reports against the defendant alleging matters which the defendant was fully aware of but claimed to be ignorant of;
(c) Contacting various banks and making false allegations against the defendant thereby affecting his reputation and good name and adversely affecting the banking relationships of SCC, CPPL and Dr Chiang;
(d) Making repeated unfounded allegations against the defendant’s good name and reputation with tenants thereby causing embarrassment to the defendant and confusion over the management and collection of rentals of various properties belonging to the Estate;
(e) Intentionally making allegations to the solicitor and executor of the Chiang Estate which the plaintiff knows to be unfounded regarding the Chiang Estate and thereby delaying the distribution of that estate; and
(f) Taking possession of No 68 Oriole without accounting for rent which should be $16,000 per month together with loss and damage to the property due to the plaintiff’s failure to maintain it.
[26] The plaintiff has filed a Reply and Defence in Counterclaim but it is not necessary to set this out in any detail.
The law relating to the passing over of executors
[27] The Probate Act governs the grant of probate and letters of administration in respect of the estate in Singapore of a deceased person. Under Singapore law, which is derived from English common law, non-Muslim persons domiciled in Singapore are free to direct how their estates should be managed and distributed after their deaths by making a will. In this will, the testator may nominate a person to be the executor of his will. Whilst such nomination will usually be given effect to, it is not a foregone conclusion that the person nominated by the testator will eventually become the administrator of the estate. There are certain situations in which the court may appoint someone else to administer the estate.
[28] In this regard, s 8(1) of the Probate Act states:
[29] It is generally accepted that this wording reposes a discretion in the court as to whether it will grant probate to the person named in the will (see: Halsbury’s Law of Singapore, vol 15, para 190.021 (“Halsbury’s”) at p 263). Under O 71 r 4(1) of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“the Rules”), the court has the duty to make “all enquiries which [it] may see fit to make” before allowing any grant to be issued. The extent of the court’s power to refuse to issue a grant to the named executor seems, however, to still be in issue. It may be contended (and this seems to be implied by para 190.022 of Halsbury’s) that the discretion is circumscribed by the circumstances set out in s 13(1) of the Probate Act which deals with various situations in which the executor appointed by the will cannot take up the appointment. These include legal incapacity which may be due to infancy or mental or physical incapacity (situations which are covered by O 71 rr 27 and 29) and the fact that the named executor has pre-deceased the testator. There is also s 55 of the Probate Act which empowers the court to grant probate to someone other than the named executor if that person fails to apply for a grant within six months of the death of the testator.
[30] It would appear, however, that leading commentators consider that the court’s discretion to pass over a named executor is not limited to the situations set out in ss 13 and 55. I also note that under s 32 of the Probate Act, any probate may be revoked “for any sufficient cause”. It would seem incongruent with this provision if the court were not to have the power to pass over a named executor equally “for sufficient cause”.
[31] A local textbook by G Raman, Probate and Administration in Singapore and Malaysia (LexisNexis, 3rd Ed, 2012) (“Raman on Probate”) considers that executors may be passed over and sets out, at pp 119–120, the “normal situations” in which this may happen as being:
These matters are not expressly stated in the Probate Act but derive from old English authority. Halsbury’s at para 190.035 seems to agree with the first category set out above, noting that a murderer may not be permitted to take a grant on the grounds of public policy and that a person who has committed manslaughter is also prohibited from obtaining a grant to the estate of the person whom he has killed. Halsbury’s relies on early twentieth century English cases for these propositions.
[32] The English authorities may not, however, be applicable in Singapore. In England the equivalent legislation is more specific about the power of the court to pass over the named executor. The relevant legislation refers to “special circumstances” which make it appear to the High Court “to be necessary or expedient” to appoint as administrator someone other than the person nominated in the will (s 116 of the Supreme Court Act 1981 (c 54) (UK)). Academic commentators confirm that the wording of this section has the same effect as earlier legislation (specifically s 73 of the Court of Probate Act 1857 (“CPA UK”)) which also included a reference to “special circumstances” and cases decided under the earlier sections are still good law in England. In the earlier cases, which include those cited in the Singapore texts, persons were passed over as executors on account of their bad character, attempts to avoid tax and delay a proper investigation of the deceased’s affairs and to waste time, neglect of their duties, imprisonment, ill health or unsoundness of mind, to name a few disqualifications (see: Williams, Mortimer and Sunnucks on Executors, Administrators and Probate (Sweet & Maxwell, 19th Ed, 2008) (“Williams on Probate”), at p 377).
[33] In view of the differences in the wording of the English and Singapore legislation, it is strongly arguable that the discretion to pass over a named executor is more circumscribed in Singapore than it is in England. This indeed was the position adopted in a case decided by the Straits Settlements’ Court of Appeal in 1937. In In the Estate of Hameed Nachial alias Hameed Nachia otherwise spelt Hameed Nachia Deceased [1937] SSLR 33 (“Hameed Nachia”), Mills J noted specifically that the CPA UK did not apply to the Colony of Singapore (“the Colony”) while Thomas CJ, who presided, also drew a distinction between the CPA UK and the Probate and Administration Ordinance (Cap 51) (“the Ordinance”) which governed the grant of probate in the Colony. Thomas CJ noted that in England the CPA UK had introduced certain exceptions to the right of a named executor to be granted probate but he emphasised that the language of the CPA UK had not been reproduced in the Ordinance.
[34] The Ordinance is a predecessor of the Probate Act and it contained a s 7 which provided that probate “may be granted” to any executor appointed by a will. This language is the same as that of s 8 of the Probate Act. The majority judges in Hameed Nachia took the view that having regard to the difference between the wording of s 7 and that of the CPA UK, the grounds for passing over a nominated executor were only those that were expressly stated in the Ordinance, for example, under ss 20 and 21 dealing with infants and lunatics respectively, and the five situations mentioned in s 54 thereof. If the reasoning set out in Hameed Nachia is applied to the Probate Act, it would mean that in Singapore the court does not have the power to pass over a named executor due to the existence of the “special circumstances” cited in Williams on Probate but can only do so in the situations provided for in s 13 (dealing with various situations in which executors cannot act including infancy, lunacy and death) and s 55 of the Probate Act, the current equivalent of s 54 of the Ordinance.
[35] Section 55(1) of the Probate Act reads (as far as material):
[36] The sub-sections cited above track the language of s 54(a) and (b) of the Ordinance and thus have been part of our law for a long time. The meaning of s 54 of the Ordinance was considered in Hameed Nachia and the facts of that case being somewhat similar to the facts here make that decision relevant for my consideration.
[37] In Hameed Nachia, the testatrix died on 30 May 1935. No application for probate having been filed by either the named executors or by any other person within six months from the date of death, the Solicitor-General filed a petition on 6 March 1936 for letters of administration to be granted to a trustee company. The next day, one of the appointed executors filed a petition for probate stating that the delay was due to his having been resident in India from the date of the deceased’s death to the middle of January 1936. The issue before the Court of Appeal was whether s 54(a) of the Ordinance allowed for the Solicitor-General’s petition.
[38] The majority of the Court of Appeal held that s 54(a) of the Ordinance should be construed such that an executor loses his right to automatic appointment if he or she neglects to apply for probate within six months of the death of the testator, and it does not matter if an application is subsequently filed and is pending at the time of the hearing. However, this did not mean that the executor would necessarily be passed over; if the executor had filed an application for probate by the time that the application under s 54 was made by another party, the court’s discretion whether to pass over the named executor would still have to be exercised judicially. In this regard, while Thomas CJ only found that the trial judge had properly exercised his discretion to pass over the executor, Cussen J laid down some useful guiding principles in determining how the court’s discretion under s 54 of the Ordinance should be exercised (at p 47):
It should be noted that the trial judge had found the executor to be unsuitable after observing the executor’s demeanour in the witness box. The trial judge noted the executor was evasive and had given contradictory answers when he was cross-examined.
[39] From the decision of Hameed Nachia, it would appear that in the present case, the court’s discretion to pass over the defendant as the named executor arises because his failure to make an application for a grant of probate within six months from Mdm Ho’s death has brought the case within s 55(a). The discretion has not arisen simply because of the inclusion of the words “may be granted” in s 8 of the Probate Act. As full argument was not addressed to me on the scope of s 8 in a situation in which s 55(a) does not apply, I do not express a concluded view on the matter. My inclination is to consider myself bound by Hameed Nachia but it may be open for parties in future cases to question whether that decision is indeed binding on the High Court.
[40] As can be seen from the summary of the “Particulars” in the statement of claim, the plaintiff here is trying to establish that circumstances exist which should move the court to disqualify the defendant from acting as the executor of the Estate. I will consider those circumstances in the exercise of my discretion under s 55 of the Probate Act. In doing so, the test laid down by Cussen J, that is, whether there is evidence establishing that it will be undesirable and unsafe to entrust the administration of the Estate to the defendant, will be applied. I will also consider whether there are any circumstances in this case which could qualify as “special circumstances” as found by the English authorities because the underlying rationale for allowing such “special circumstances” to determine whether an executor should be passed over must be the court’s determination that the existence of such circumstances make it undesirable and unsafe to entrust the administration of the Estate to the named executor.
[41] I should mention that in Hameed Nachia, the first instance judge (the “trial judge”) decided that the named executor should be passed over. None of the members of the Court of Appeal were inclined to interfere with this holding. From the judgment of Cussen J, it appears that the trial judge had expressed the view that there were ample reasons for passing the executor over, that the interest of the beneficiaries would be gravely imperilled if he were given control of the estate and that it appeared to the trial judge that the executor was likely to show carelessness, incompetence and negligence which would result in “appalling loss and hardship” to the beneficiaries. Also, his interest was opposed to that of the infant beneficiaries in that he had said that he did not know that their mother, Fatima, was his father’s wife whereas other evidence showed that the executor and the rest of the family were well aware that these infants were entitled to benefit under the will.
Renunciation
[42] The plaintiff has another string to her bow: this is the contention that the defendant had constructively renounced his right to, and is therefore precluded from, applying for grant of probate. As this contention is self-contained, I shall deal with it first.
[43] Under s 4(1) of the Probate Act, a person who has an interest in the estate of a deceased person may cause to be issued a citation directed to the executor appointed by the deceased’s will calling upon the person cited to accept or renounce that right. Under sub-s 2, any person so cited may enter an appearance to the citation but if he defaults in doing so, he is deemed to have renounced his right. Following from this, under s 13(1)(b) of the same Act, where the executor appointed by will has renounced the right to act as such, letters of administration with the will annexed may be granted to such person as the court considers the fittest to administer the estate. Such citation must be in one of the forms in Form 181 and the procedure applicable is set out in O 71 r 42.
[44] Order 71 r 42 reads so far as is material:
[45] On 27 September 2010, the plaintiff filed a Citation in the High Court calling upon the defendant to, within eight days after service of the Citation on him, enter an appearance and accept or refuse probate and execution of the will of Mdm Ho. The Citation did not recite the rule it was taken out under, but it is plain from the plaintiff’s description of herself as a beneficiary and legatee that it was taken out under r 42(1). The Citation was served on the defendant on 5 October 2010. This meant that the defendant had until 13 October 2010 to enter appearance. The defendant, however, did not enter his appearance to the Citation by that date. Instead, about a month later, on 11 November 2010, he filed his application for grant of probate. The defendant only entered appearance to the Citation on 9 December 2010. The plaintiff submitted that, by failing to enter appearance within the specified time, the defendant had renounced probate and was no longer entitled to it. It is plain from a reading of r 42(4) that the defendant did not comply with the rule because he should have entered appearance before applying for the grant and should then have filed an affidavit showing that he had entered an appearance and stating that he had not been served by the plaintiff with notice of any application for a grant to herself.
[46] The defendant submitted that he had not renounced his right to a grant by failing to enter appearance to the Citation within eight days. He argued that s 4 of the Probate Act read with O 71 r 41(6) makes it clear that an appearance that is entered after service of a Citation, even after eight days, can be accepted as long as the citor has not applied under r 42(5) for a grant to herself. In this case, the plaintiff did not apply for a grant to herself before 11 November 2010. Therefore, it did not lie in the mouth of the plaintiff to argue that the defendant was precluded from entering an appearance to the Citation after eight days. The plaintiff was aware that the defendant had acted as executor and she had received letters from the defendant’s solicitors regarding the Schedule of Assets. Shortly after she filed the Citation, the defendant’s solicitors had informed her that the defendant intended to apply for the grant. The plaintiff therefore had no basis, whatsoever, to assume that the defendant intended to renounce his right as executor of the will.
[47] In my opinion, the defendant is right in contending that the plaintiff knew that he wished to accept the appointment and administer the Estate. Shortly after Mdm Ho’s death, the defendant began to intermeddle in the Estate. On 24 August 2009, he closed a joint account which he had with Mdm Ho and into which rentals from her properties were deposited. He transferred the balance from the joint account into a new account in his own name. His reason for these actions was that he did not want the income of the Estate to be frozen before the grant was issued. Thereafter, he took steps to have rental income paid into his new account which he operated as an Estate account. He also attempted to deal with the renewal of the tenancy of 68 Oriole on the basis that he was the executor named in the will. The plaintiff was aware of all this and knew very well that the defendant was purporting to exercise the powers of an executor even though he had not applied for probate yet. On 29 October 2010, the defendant’s lawyers wrote to the plaintiff’s lawyers stating that as the Singapore affairs of Mr Chiang had been settled, they were filing the application for probate to be granted to the defendant. If the plaintiff had not known prior to that date that the defendant wanted to be executor, she knew it on that date. Yet the plaintiff did not, as she could have, filed an application under s 55 for probate to be granted to her because the defendant had not filed his application within time and had not yet entered appearance to the Citation.
[48] As I have pointed out, the defendant did not follow the Rules in relation to entry of appearance and filing of his probate application. These failures on his part constituted irregularities only, not illegalities. The defendant was still able to file his probate action, and he did so before any other probate application was filed. In all the circumstances, I conclude that the defendant did not actually, or constructively, renounce his right to probate. Notwithstanding that there was no renunciation, by his very failure to apply for probate within six months of Mdm Ho’s death, the defendant brought himself within the bounds of s 55 of the Probate Act and, as Cussen J put it, “lost his favoured position at the expiration of the period and his right to a grant [became] subject to the discretion given to the Court by this section” (Hameed Nachial at p 46).
Discussion and analysis of the grounds on which the plaintiff contends the defendant should be passed over
[49] The focus of this part of the judgment is on whether the various grounds put forward by the plaintiff establish that it would be undesirable and unsafe to entrust the administration of the Estate to the defendant. In her submissions, the plaintiff has referred to the duties of a trustee and argued that various actions taken by the defendant are in breach of his duties as a trustee and he should be removed as such. This is not quite the right way of looking at the matter as what is being considered is not the removal of a trustee but whether the defendant should be confirmed in that position.
[50] The plaintiff’s position is that the defendant owed the Estate “fiduciary duties as trustee and personal representative” and these duties included the following:
(a) not to mix Estate money with his own money or with money from other estates;
(b) not to convert for his own use any of the funds of the Estate before distribution;
(c) to avoid any potential conflict of interest and not to act for his own personal benefit;
(d) to comply with all court orders, practice directions and Rules of Court;
(e) to properly and completely list all assets of the Estate;
(f) to take up probate application and effect distribution on a timely basis;
(g) to provide accurate, complete and timely accounts of the Estate;
(h) to consult and give effect to the wishes of beneficiaries;
(i) to be even-handed and act fairly towards all beneficiaries; and
(j) to act honestly and reasonably.
[51] I will consider which of the alleged duties, if any, were owed by the defendant at the same time as I consider the plaintiff’s grounds for contending that the defendant should be passed over. These grounds are set out in her statement of claim and repeated at [22] above.
Diversion of Estate funds
[52] The plaintiff’s complaint in para 4 of the statement of claim was that the defendant had diverted funds belonging to the Estate into his own personal POSB Account xxx93-6 and, shortly after her death, tenants of properties owned by Mdm Ho were instructed to pay rental into that bank account. The defendant had acted in breach of duty to inform and consult all beneficiaries if funds were so diverted and was liable to account to the Estate for moneys so diverted. He had also caused the Estate to be deprived of interest.
[53] The defendant denied having diverted all the Estate’s funds. He stated that the plaintiff informed the banks of Mdm Ho’s death knowing that this would cause the bank accounts to be frozen and that payments made to the accounts would be rejected. This would cause loss to the Estate. On 24 August 2009, POSB sent an officer to Mdm Ho’s wake to verify her death. Thereafter, deposits for rental were not accepted. As an interim measure, until an estate account could be opened, tenants were informed to bank their cheques into an interim account. This was done purely for expediency and no money was used for the personal benefit of the defendant. The account opened by the defendant was POSB Account xxx93-6. I shall hereafter refer to it as “the Interim Account”.
[54] In court, the defendant produced evidence that all bank accounts in the sole name of Mdm Ho remained in existence. He had not closed them. He relied on the evidence given by an officer of the POSB that, upon the death of an account holder, although money could be received into the account, no money could be withdrawn from such account until the grant of probate had been obtained.
[55] The defendant’s own evidence was that the rents for 68, 70 and 72 Oriole were due at the same time and he received a complaint that there had been difficulties with one payment because Mdm Ho’s accounts were frozen. He decided to act quickly to avoid complaints from the other tenants. Therefore, he established the Interim Account, a new account in his sole name, to be used as an interim estate account. Thereafter, the tenants were instructed to pay rental into the Interim Account.
[56] Further, the defendant and Mdm Ho had a joint account with the POSB, Account No xxx46-8 (“Account 46-8”) which could be operated by the defendant acting alone. Account 46-8 contained money belonging to Mdm Ho. It also contained funds which had been transferred into Account 46-8 from a POSB account in the name of Mr Chiang, viz, Account xxx99-0 (“CCL’s Account”). On 24 August 2009, the defendant transferred the balance in Account 46-8, the sum of $1,236,233.17, into the Interim Account. He then closed Account 46-8. He was able to do this because he was a joint account holder.
[57] The plaintiff submitted that there was no necessity for the establishment of the Interim Account because rental accruing due to the Estate could have been banked into any of Mdm Ho’s personal accounts. She contended that the defendant was not entitled to put the Estate’s money into the Interim Account because that was his own account and not an account belonging to the Estate. The defendant should not have closed Account 46-8 before obtaining the grant of probate. Instead, it was his duty to list this bank account in the Schedule of Assets of the Estate. The defendant’s actions were a breach of the defendant’s duty to act honestly and in good faith.
[58] The defendant explained that he had opened the Interim Account purely for expediency and that no money from it was used for his personal benefit. He had taken action because he was the person who had been managing all the Chiang family properties and finances on his parents’ instructions. The Interim Account received the Estate’s funds and was used to pay the expenses of the Estate. Further, all payments were by cheque or by GIRO and supported by vouchers. All the bank statements and vouchers had been disclosed to the plaintiff. Further, a complete account of transactions in CCL’s Account had been prepared and audited by Messrs Lau Chin Huat & Co (Certified Public Accountants) (“LCH & Co”) and copies of the same together with supporting invoices had been given to the Chiang Estate.
[59] As I see it, in relation to the administration of the Estate and the handling of money due to it prior to the grant of probate, the defendant had three options. First, he could have banked payments to the Estate into Account 46-8 or any of Mdm Ho’s sole accounts. This course, however, would have meant that there would be no money in his hands to fund the expenses of the Estate and, if he wanted to prevent the Estate from incurring indebtedness, he would have had to pay the same from his own funds. His second alternative was to leave all Mdm Ho’s accounts, including Account 46-8, as they were and start a new account to receive future payments to the Estate and fund future expenses of the Estate. The disadvantage of this course would be that there might not be enough money in the new account to fund the expenses. The third alternative was to do what he did, which was to transfer the funds in Account 46-8, the only account that he could operate after Mdm Ho’s death, to a new account in his name which he could operate as an estate account. The advantage of this course was that it put funds in his hands to deal with the Estate’s liabilities. However, he had the obligation not to intermingle these Estate funds with his own money and he also had to keep proper accounts of the receipts and expenditure which were made into and from the Interim Account.
[60] The defendant did furnish the plaintiff with accounts of the Interim Account. The plaintiff called her husband, Mr Lim Tong Huat, as an expert witness to give evidence on these accounts. Whilst Mr Lim cannot be accorded the status of an independent expert in view of his intimate connection with the plaintiff, some parts of his evidence can be used. In court, Mr Lim accepted that the exact credit balance from Account 46-8 had been transferred to the Interim Account by the defendant. The plaintiff, however, was not willing to make a similar concession and would not agree that all funds from Account 46-8 had gone into the Interim Account. She persisted in her belief that funds had been transferred into some other account of the defendant and converted by him. This was stubborn and unreasonable and does not show the plaintiff in a good light.
[61] I have concluded that the defendant was not in breach of any duty when he closed Account 46-8 and transferred the balance into the Interim Account. I accept that he did this in order to have funds to administer the Estate and to have a bank account into which amounts paid to the Estate after Mdm Ho’s death could be deposited and withdrawn as and when necessary for the purposes of settling the liabilities of the Estate. He did not intend to convert the moneys in the account. The defendant has kept accounts of all payments into and out of the Interim Account, and the plaintiff has not been able to show any discrepancy in these accounts. The plaintiff has made allegations of wrongful payments made by the defendant using Estate funds. Those allegations, if established, would constitute a separate ground on which the defendant could possibly be found to be unsuitable to be appointed executor. I will deal with those allegations later.
[62] The defendant could have handled the matter of Account 46-8 differently but the plaintiff’s complaints in regard to the closure of the account are technicalities only and do not relate to substance. The defendant was not obliged to inform the beneficiaries before closing Account 46-8 or to obtain their consent to this action. The defendant has at all times recognised that the money in Account 46-8 belonged to the Estate and that having intermeddled with it, he has a duty to account for it.
Transfer of money from CCL’s Account
[63] In para 5 of the statement of claim, the plaintiff pleaded that the defendant had transferred money from CCL’s Account into Account 46-8. These transfers started in 2002 after the formation of the Committee and continued until shortly after Mdm Ho’s death. In November 2004, the balance in CCL’s Account was $986,426.96 but on 24 August 2009 it was only $78,147.09. The plaintiff had informed Ms Ong, as the executor of the Chiang Estate, of the withdrawals. On 6 May 2011, the defendant returned $600,000 to the Chiang Estate.
[64] The plaintiff alleged that the defendant had acted in contempt of court and in breach of trust in effecting the transfer of money from CCL’s Account into Account 46-8. She asserted she had suffered loss as a beneficiary of the Chiang Estate and no longer had access to the money in CCL’s Account which belonged to all three children/beneficiaries of Mr Chiang and not to the defendant alone. She further asserted that there was a further $308,279.87 which had to be returned to the Chiang Estate.
[65] In his defence, the defendant set out the matters relating to the appointment of the Committee. He stated that after the appointment of the Committee, Mdm Ho controlled all the financial affairs of the Chiang family and directed the defendant to deal with the Chiang family wealth according to her wishes. The plaintiff had full knowledge of this. Mdm Ho directed the defendant to transfer money from CCL’s Account to Account 46-8 in order to avoid any dissipation or claim by any third party such as Ms Wen. The defendant pleaded that all moneys in CCL’s Account had been accounted for and returned to the Chiang Estate. The matters raised by the plaintiff were irrelevant to the issue of grant of probate in relation to the Estate as such matters concerned only the Chiang Estate which had no issue with the transfers.
[66] In her closing submissions, the plaintiff asserted that the defendant had mixed the funds of the Estate with funds from CCL’s Account and, in doing so, had breached his duty to properly account for Estate moneys.
[67] This might be the appropriate point to say something about the dynamics of the Chiang family. The defendant was the youngest child but only son. It appears that his parents reposed a great deal of confidence in him and entrusted much of the running of the family businesses and their finances to him. The daughters were shareholders and directors of the family companies but were not involved in their operations. Dr Chiang had her own career as an ophthalmologist. She seems to have been on good terms with her brother throughout and is now aligned with him in this litigation. The plaintiff, the middle child, trained as an accountant and worked in a bank for a few years but has not practised accountancy or undertaken business for a long time. She has been at odds with her siblings for some years and has taken certain actions in relation to Mr Chiang which they did not agree with. The plaintiff was removed as a director of SCC in 2004 although she was reinstated some years later. The defendant asserted that during the lifetime of his parents, the plaintiff did not provide care for them and was estranged from the family. It is notable that when the decision was taken in 2002 to apply for the appointment of the Committee, Mdm Ho, Dr Chiang and the defendant acted together. The plaintiff was left out. Subsequently, after an initial opposition, the plaintiff became part of the Committee. The defendant asserted that thereafter the plaintiff did not participate in any matter relating to Mr Chiang and everything was handled by him on the instructions of Mdm Ho. It is clear from this assertion that the defendant never consulted Dr Chiang or the plaintiff on matters relating to Mr Chiang’s financial affairs. The animosity between the plaintiff and her siblings is still in evidence. The plaintiff must shoulder her share of the blame for this situation because she has made complaints to various authorities about her siblings as a result of which they have been subject to various investigations.
[68] Whilst Dr Chiang may have been content for Mdm Ho and the defendant to deal with Mr Chiang’s affairs, in law, it was not correct for the two of them to take matters into their own hands and act without consulting the other members of the Committee. The Committee was appointed as a whole and the members therefore had to act jointly rather than severally. It was not correct for Mdm Ho and the defendant to transfer funds from CCL’s Account into Account 46-8 which was in their joint names. The money should either have been left where it was or transferred into an account in the names of all the members of the Committee and stated to be held on trust for Mr Chiang. That way, there would have been no danger of intermingling Mr Chiang’s funds with money belonging to any other family member, including Mdm Ho and the defendant. I accept the defendant’s evidence that he made these transfers on the instructions of Mdm Ho. That does not totally excuse him, however. As an adult and member of the Committee, he was in a fiduciary position and could not simply comply with his mother’s wishes. He should have consulted the other members of the Committee and taken legal advice. However, the plaintiff not being the legal representative of the Chiang Estate is not in a position to ask for any relief in relation to these transfers.
[69] The defendant has returned money to the Chiang Estate. Whether the amount returned is correct is not a matter for decision in this action. There is, as far as I am aware, no claim by the Chiang Estate against the Estate for any more money. It is worth noting that in the Judgment recording the settlement of S 820, it has been expressly provided that the plaintiff here shall not make any claim against the defendant here in respect of the withdrawal of moneys from CCL’s Account prior to the death of Mr Chiang. Thus, the plaintiff can no longer complain that as a beneficiary of the Chiang Estate she has been adversely affected by those withdrawals.
[70] The defendant’s actions in relation to CCL’s Account cannot be regarded as a breach of any duty in relation to the Estate. They may, however, affect my assessment of his suitability to be appointed as the executor of the Estate. In this respect, I accept that his motives were to protect the Chiang family against loss of Mr Chiang’s assets and that Mdm Ho was very concerned about this due to Mr Chiang’s relationship with Ms Wen. I also note that Dr Chiang testified that the plaintiff had been present at family meetings during which Mdm Ho had told her children that she was carrying out transfers from CCL’s Account in order to safeguard the funds from third parties.
Conflict of interest
[71] The plaintiff complains that the defendant is in a conflict of interest position in relation to:
(a) the moneys withdrawn from CCL’s Account and deposited into Account 46-8; and
(b) the deposit of rental income from 68 Oriole into Account 46-8 instead of into an account that was in the names of Mr Chiang and Mdm Ho who were the joint owners of 68 Oriole until Mr Chiang’s death.
She contends that since these transfers and deposits were effected by the defendant, he would not be able to carry out an objective review to ascertain how much money has been erroneously put into Account 46-8. An independent reviewer is needed for this job.
[72] The defendant denied that there was a conflict of interest. He averred that the plaintiff knew all along that all money belonging to Mr Chiang and which arose from the Chiang family properties were handled by Mdm Ho. The rental income was used to repay loans taken out by Mr Chiang and Mdm Ho for the family businesses. The plaintiff was aware of this as a director and shareholder of the companies. Further, separate accountancy professionals had audited the accounts of the Estate and those of the Chiang Estate. These professionals have not raised any objections to the way in which the rentals have been dealt with.
[73] The defendant has procured an independent professional review of the amounts transferred from CCL’s Account to Account 46-8. This review was accepted by the accountants of the Chiang Estate. Further, Mdm Ho was a joint owner of 68 Oriole. Thus, during her lifetime she was entitled to decide how to use the income of that property and could direct the defendant to pay the rental into Account 46-8. The only person who could challenge that decision was Mr Chiang/his legal representative. No such challenge has been mounted. Further, the evidence was that even before the appointment of the Committee, Mdm Ho had managed the rental income of the family properties. On an overall consideration of the circumstances, I am satisfied that the defendant is not in a conflict of interest position in relation to the matters stated in [71] above.
Closure of bank accounts
[74] The plaintiff averred in her statement of claim that two joint accounts which Mdm Ho had with the defendant had been wrongfully closed shortly after Mdm Ho’s death. One of these accounts was Account 46-8. I have already dealt with that account and need say no more about it. As for the other account named by the plaintiff, POSB Account xxx48-1, the defendant produced the passbook for this account in court. This showed that the account was held by Mdm Ho solely and that it was not closed after her death. The account was still in existence. Accordingly, there was no merit in the plaintiff’s allegation in relation to POSB Account xxx48-1.
Delay in taking out probate
[75] In para 8 of the statement of claim, the plaintiff complained about the defendant’s delay in applying for probate and how she had to serve a Citation on him and also take out proceedings to compel him to deposit Mdm Ho’s will in the Registry of the Supreme Court. She also pleaded that his application for probate was irregular and that he had constructively renounced his rights to probate. In para 10 of the statement of claim, the plaintiff pleaded that there was no acceptable reason for the inordinate delay in applying for probate. She renewed this complaint in her closing submissions alleging that the real reason for the delay was to avoid the distribution of assets to her.
[76] I have dealt with the points on irregularity and constructive renunciation above. It remains for me to consider whether the dilatoriness of the defendant renders him unsuitable for appointment. This would depend on the reason for the delay.
[77] The defendant submitted that there was no inordinate delay in applying for grant of probate. In his affidavit of evidence-in-chief, he explained that he thought it would be premature to proceed with administration of the Estate until all matters and assets due from the Chiang Estate had been got in for a proper and complete account. There were complications here such as a suit in respect of the Chiang Estate started in Taiwan by Ms Wen (“the Taiwanese action”). However, in the meantime, he had done a great deal of preparatory work such as writing to the banks and stock exchange and obtaining valuations of the Estate’s real assets. He stated that because of “the complexity of relationship, distrust and disharmony” that existed, he had been advised that the most prudent thing to do was to wait for probate to the Chiang Estate to be granted before he proceeded in respect of the Estate.
[78] The desire to wait for the Chiang Estate to be settled was the explanation given in these proceedings. In November 2010, when the defendant filed the probate application, he had to give a reason for his delay. He did not give the same explanation then. Instead, he said he was “ignorant of the law”. I consider that to be a disingenuous explanation. The defendant was legally advised at all material times and could not have been ignorant of the requirement to file for probate within six months of Mdm Ho’s death.
[79] I also think that desiring to wait for a grant to the Chiang Estate to be made was not a very good reason for delaying the application here. There was work to be done for the Estate, especially in regard to the collection of rents and the handling of tenants. Quite soon after Mdm Ho’s death, the defendant was confronted with the need to open an account to handle payments to and from the Estate. It would, therefore, have been more prudent for him to apply as soon as he could for the grant so that the period of intermeddling with the Estate would have been shortened. Further, even though administration of the Estate could not be fully completed until the Chiang Estate had been distributed, the defendant would have had an earlier start at gathering and controlling the assets Mdm Ho owned in her own right and not by virtue of inheritance from Mr Chiang.
[80] On the other hand, although the defendant was slow in applying for the grant, he was not slow in taking control of Mdm Ho’s assets to the extent that he could and in dealing with them as best he could prior to the application for the grant. He did encounter some difficulty with the tenant of 68 Oriole because of the absence of the grant, but apart from that there was no evidence that the assets of the Estate were in any way prejudiced by reason of the delay. I note that Dr Chiang had no complaint about the delay.
[81] On an overall consideration, I think that I must weigh delay as one of the factors when assessing the defendant’s suitability. From the beginning, he was intent on being the executor – the delay was not due to any reluctance or disinclination to take on the task. He was aware from the various letters that the plaintiff’s solicitors sent him that she was anxious about the administration of the Estate but he simply ignored these letters and did not explain his reasons for not acting immediately. This may be an indication of the defendant’s unhelpful attitude towards the plaintiff. Though I accept that the plaintiff is an extremely pushy person who is capable of unremitting nagging, as a beneficiary of the Estate it is not unreasonable for her to expect some efficiency in its administration. Further, as I have mentioned above, the reason for the delay was not compelling.
Failure to provide information and accounts
[82] This complaint, detailed in para 9 of the statement of claim, was that despite repeated requests for various information, the defendant had only supplied accounting and bank statements on 28 June 2011 and, upon review, the same were found to be inadequate. The plaintiff was unable to ascertain if the defendant had made refunds to the Estate after her discovery of his transfer or diversion of funds belonging to the Estate. Further, the plaintiff had to spend $25,000 to get a set of Estate accounts for review and information.
[83] In closing, the plaintiff submitted that Mdm Ho had had bank accounts in the Hong Kong branches of ANZ Bank and HSBC that the defendant had not disclosed. She asserted that he had not included all the assets of Mdm Ho in the Schedule of Assets and he wanted to hide her bank accounts. As a trustee, he was required to provide information requested by the beneficiaries and he had not done so in relation to these accounts. She also complained that he had persistently refused to furnish Estate accounts or bank statements until a summons was taken out to compel him to do so. The first set of accounts was only furnished on 28 June 2011, after seven letters were sent by the plaintiff’s former solicitors, and just before the hearing of Summons No 1663 of 2011. The second set of accounts was listed in the defendant’s list of documents after another summons hearing on 16 March 2012, and the third set of accounts was ordered on 27 August 2012, after hearing of Summons 2620 of 2012. Although the court had ordered up-to-date accounts, only accounts up to May 2013 had been furnished. As for bank statements, these had been ordered but the statements furnished were only up to 7 March 2012.
[84] The plaintiff complained that the defendant had persistently refused to furnish accounts. In his affidavit he had averred that he had no obligation to disclose the accounts until after the grant of probate had been issued. His solicitors had said earlier (21 January 2011) that no disclosure needed to be made by the defendant as no distribution had been made. Further, the accounts prepared by LCH & Co only provided a summary of receipts and expenses related to properties owned by Mdm Ho and two properties belonging to CCL’s estate. They were not proper or complete estate accounts that captured all receipts and payments made.
[85] The plaintiff cited textbook authority to the effect that a trustee has a duty to keep clear and distinct accounts of the property he administers and to be constantly ready with his accounts. Apart from Lewin On Trusts (Sweet & Maxwell, 18th Ed, 2008) (“Lewin On Trusts”) at para 23-22, she also relied on Equity & Trusts by Michael Haley & Lara McMurtry (Sweet & Maxwell, 4th Ed, 2014) (“Haley & McMurtry”) for this proposition. Para 13.13 of the latter text states that every beneficiary is entitled to inspect the trust accounts and that if the beneficiary wants a copy of the accounts, the beneficiary has to pay for them. The beneficiary may challenge the accounts and the trustee is then under a duty to correct any errors detected in the accounts.
[86] Haley & McMurtry at para 13.15 also deals with the duty of a trustee to provide information and documents to the beneficiaries as to the current state of the trust properties and any dealings that have occurred in relation to it. They opine that the trust document that a beneficiary is entitled to see is essentially one that is in the possession of the trustee in his capacity as trustee and which contains information about the trust.
[87] Lewin on Trusts provides a slightly different perspective. It states the law as it stands after the review carried out by the Privy Council in Schmidt v Rosewood Trust Ltd [2003] 2 AC 709 (“Schmidt”). The text (at para 23-18) distils eight principles of which the following are relevant here. First, a beneficiary has a right to seek disclosure of trust documents and this right is best approached as an aspect of the court’s inherent jurisdiction to supervise and, where appropriate, intervene in the administration of trust. The court has a discretion to decide, among other things, what classes of documents should be disclosed, either completely or in redacted form, and what safeguard should be imposed to limit the use which may be made of documents or information disclosed under the order of court. It should be noted that in Schmidt the Privy Council stated that no beneficiary has any entitlement as of right to disclosure of anything that can be plausibly be described as a trust document. Lewin On Trusts comments at para 23-23 that even before Schmidt courts had accepted that there was a prima facie right only, and no absolute entitlement to disclosure of trust documents including trust accounts.
[88] The defendant submitted that he had acted reasonably in providing documents and statements sought by the plaintiff. He stated that the plaintiff had not provided any authority for the contention that he had to provide for accounts on demand. His position was that his obligation to provide a full account of the Estate to the beneficiaries would only arise at the time of the distribution of the Estate to them. In this regard, he relied on the following paragraph from Raman on Probate at p 167:
I would point out that the foregoing statement of the law does not fully support the defendant’s position. Raman on Probate indicates plainly that although at the end of administration of an estate a personal representative would have to render proper accounts, such personal representative is obliged to render accounts during the administration of the estate if he is called upon by the beneficiary to provide them. The duty in the case of a personal representative is a continuing duty, much like the duty imposed on a trustee as adverted to in earlier paragraphs of this judgment.
[89] Whilst both trustees and personal representatives have a duty to maintain accounts and generally to provide them at the beneficiary’s request, this does not mean that any beneficiary can keep on demanding accounts and information without giving the trustee/personal representative some respite. In my view, it is common sense that there must be reasonable intervals between the demands and a trustee/personal representative should not be considered to be in breach of trust simply because he does not always supply the documents and information immediately upon the beneficiary’s demand. Whether the trustee/personal representative has complied with his duty to supply documents and information is a fact-sensitive exercise in every case.
[90] In the present case, the defendant took the position that his obligation to provide a full account of the Estate would only arise at the time of distribution of the Estate. However, he also said that he had kept proper accounts of the income and expenses of the Estate since Mdm Ho’s death and had appointed accountants, the said firm of LCH & Co, to ensure that the Estate accounts were kept in order. He also appointed estate agents to rent out the properties belonging to the Estate. Further, the accounting documents that he had given the plaintiff should be considered a reasonable discharge of his duty.
[91] The defendant’s evidence was that three sets of accounts had been prepared and audited, and given to and received by the plaintiff. The first set of accounts consisted of a schedule of receipts and expenses for 68, 70 and 72 Oriole, 151 Cavenagh, 33 Merryn, and 17B and 17C Dublin. This was accompanied by various bank statements and sent to the plaintiff on 28 June 2011. On 8 July 2011, the plaintiff was sent copies of invoices and statements of accounts. Subsequently, the defendant sent the plaintiff the accounts from 1 September 2011 to 31 August 2012, and later the accounts from 1 September 2012 to 31 May 2013. Mr Lau, of LCH & Co who testified, confirmed that all transactions in relation to the properties belonging to the Estate were accounted for and there were receipts to prove these transactions. The defendant himself testified that the accountants had pointed out to him that he had included some items as Estate expenses which should not be charged to the Estate due to lack of proper receipt documentation. He stated that he had accepted LCH & Co’s opinion and had repaid the Estate the items that had been wrongly debited. He tendered the relevant bank slips showing such repayment.
[92] This action was started on 28 July 2011. By then the plaintiff had already received one set of accounts concerning the properties belonging to the Estate and its bank accounts. Thereafter, the plaintiff received the accounts for the period 1 September 2011 to 31 August 2012 and the accounts for the period 1 September 2012 to 31 May 2013. Contrary to the plaintiff’s assertions, these sets of accounts were not furnished in response to her chamber applications. As far as Summons No 1045 of 2012 was concerned, that was a summons for general discovery in this action and not a summons for the accounts after 28 June 2011. Summons No 2620 of 2012 was a summons for specific documents filed in May 2012 and it was dismissed when it came up for hearing. I am satisfied that the defendant did not breach his duty to provide accounts even though he considered that he was not bound to do so until distribution. The plaintiff had sufficient information in her hands to analyse the transactions and complain about those that she thought should not have been charged to the Estate. In fact, some of the subsequent amendments to the statement of claim arose out of the plaintiff’s examination of the accounts. I will deal with those complaints later. The fact remains that she was kept apprised of what had occurred albeit not as frequently as she might have liked.

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Chiang Shirley v Chiang Dong Pheng

Grounds of decision

Introduction

Background

General details about the Chiang family

Properties in the joint names of Mr Chiang and Mdm Ho

Properties in the sole name of Mr Chiang

Properties in the sole name of Mdm Ho

Events from 1998 to 2009

Initial actions

Suit 820 of 2012

The present proceedings

The law relating to the passing over of executors

Renunciation

Discussion and analysis of the grounds on which the plaintiff contends the defendant should be passed over

Diversion of Estate funds

Transfer of money from CCL’s Account

Conflict of interest

Closure of bank accounts

Delay in taking out probate

Failure to provide information and accounts