Podcast S3E3 | Contentious Trusts & Estates: Challenging a Will

subscribe to our podcast

Podcast S3E3 | Contentious Trusts & Estates: Challenging a Will

Podcast S3E3 | Contentious Trusts & Estates: Challenging a Will 1200 675 Alfred Ip
Reading Time: 17 minutes

Alfred Ip and Geraint Ho discuss essential points related to disputes involving Wills and their validity, including provisions which can be afforded to dependants and creditors towards an estate. They also highlight some high-profile estate dispute cases in Hong Kong Courts and how to properly approach your Estate Planning.

SHOW NOTES

00:41 Proving a Will
02:45 Entering a caveat
11:09 Real life scenarios
14:58 Carrying out an investigation
16:43 Client-solicitor confidentiality
18:25 Settling inheritance disputes
19:30 Inheritance Provision for Family and Dependants Ordinance, Cap. 481
24:59 Validity of the Will
26:10 Landmark cases in Hong Kong
28:08 Final considerations on Estate Planning


TRANSCRIPT

00:02
Welcome to Series 3 of The HIP Talks podcast: a series of discussions on legal issues hosted by Hugill & Ip Solicitors. The firm provides high quality legal services with integrity, professionalism and respect for its clients and the community. An outstanding team of lawyers who have achieved exceptional results and recognition in the areas of Dispute ResolutionCorporate & CommercialPrivate ClientFamilyEmployment & Business Immigration and Data Privacy.

Geraint Ho  0:29
Good morning, listeners. I’m Geraint Ho and today I’m here with Alfred Ip. We’re from Hugill & Ip and today we are here to talk about inheritance disputes, specifically how to challenge a Will in Hong Kong.

Alfred Ip  00:40
Hello Geraint.

Geraint Ho  00:41
Good to see you. Well, first things first, Alfred, can I ask what it means to challenge your Will in the context of a legal dispute? Does it mean to have the Will declared invalid or something else?

Alfred Ip  00:51
A lot of times, it’s about declaring a Will invalid, but other times it’s just to put a Will to strict proof that is asked from the testator to prove that the Will is valid and proper.

Geraint Ho 01:05
Right. Well, from what I understand normally, in the probate process, when a person passes away, the executor of a Will, would have to go through a process of proving the Will with the local authorities anyway. So could you perhaps expand a bit more on what you mean when you say putting the Will to strict proof?

Alfred Ip  01:24
So nowadays, when a testator passes away, the executor named in the Will has the responsibility to prove to the court that this is the last Will. And in the course of the application, if there’s nobody who comes forward to challenge your Will, the court would assert that the Will is valid and enforceable, so long as it appears to be one. The common requirement for making a Will is that, first of all, it has to be in writing, and then it has to be signed by the testator and with the two witnesses. If a document purporting to be a Will contains this kind of element, your court will usually accept it. But that is important if someone believes that a Will is not valid, and they want to challenge it, they have to take action fast because once the Will is probated, it will be much more difficult for anyone to seek to challenge it. Especially when the Will is probated, and the assets of the deceased have already been administered. Where are they going to find the assets and try to set aside the Will? What’s the point then?

Geraint Ho  02:34
Right, so it seems like speed is of the essence, in terms of wanting to challenge your Will, and, you know, someone has to bring a challenge before the estate gets distributed away.

Alfred Ip  02:45
Yes, correct. And the first thing that we will ask our client to do is to file a caveat. Geraint, do you know what is as a caveat?

Geraint Ho
No, not really.

Alfred Ip  02:55
Okay. A caveat is effectively a notice to the court not to issue a grant to anyone without the persons who issued the caveat notice. We call that person caveator. The caveator has the right in the estate and those who want to probate a Will have to clear that caveat before a grant of probate will be issued to him. So, the first thing that the caveator would know is when the person asked to probate a Will, they will issue a warning. Warning is a piece of document. It sounds like this is a warning but actually it’s just a piece of document. The purpose of it is to ask the caveator to explain what contrary interests he has in the estate. And after receiving the warning, the caveator can file a document called appearance, otherwise the caveat would not have effect after eight days of the receipt of the warning. And if the caveator issued appearance, the appearance will state what sort of contrary interest that he has in the estate and after filing the caveat and warning and appearance, the parties will start this (process) called caveat proceedings. There are two ways to go about it: either the caveator or the person warning will issue a probate action that would be a commencement of a probate action or they will continue with the proceedings in the caveat proceedings seeking various reliefs that they will be advised to seek from court and the court will decide upon that.

Geraint Ho  04:44
Thank you, Alfred, that’s a very detailed summary of the procedure. Now I’ve heard the term contrary interests being mentioned a couple of times. Would that be something like saying I have another Will in my hands and what you are trying to probate or prove to the court is not in fact, the correct Will of the deceased? Would that be something that’s a contrary interest or is there anything else that could be classified as a contrary interest?

Alfred Ip  05:10
That could be one of them. And another situation would be when a person is supposed to be the administrator, according to the intestacy rules, and they realize that actually there is a Will that you didn’t know about, and somebody else is entitled to the grant instead of them. And they want to inquire as to who the other person is, and why they are entitled to the administration. And that would be a question to be decided by the court and properly, that person would want the executor to prove to the court that he’s indeed entitled to administer the estate by proving that the Will that he has in hand is valid, and the other person may want to challenge the Will.

Geraint Ho  05:53
Right. So, it sounds like we are sort of moving the topic into how we actually sort of bring legal proceedings or sort of fight the case in court. Now, putting myself in the position of someone who wants to bring a challenge to a Will, could you sort of take us through what sort of grounds people usually rely on if they need to challenge a Will?

Alfred Ip  06:13
Well, it very much depends on the circumstances, but most of the grievances that we heard from the family member is that they were not aware that the deceased made the Will. And after knowing more about how the Will came about, they have a lot of grievances towards that process, because they’re not involved. Naturally, they will have a lot of questions. And these kinds of questions usually surrounding this kind of circumstances: first of all, was the Will properly executed and for a Will to be properly executed, there are a few elements to it. First of all, the testator should understand the contents of the Will and its legal effect. So, it should be properly explained to the testator what it is in the Will, sometimes, you know, the person who signed a piece of document didn’t really see it before signing it. And in the context of a Will this is a big no-no, because a Will is a very important document. The major effect of it is that it only takes effect after the person passed away. And the person who signed it usually cannot come back and explain that, oh, I designed the world and I understand the legal contents of it. And this is the reason why the Will must be properly executed. And the process of execution should be properly documented. And this is the reason why we always advise our clients to make the Will before two lawyers or two legal professionals who understand and have experience in attesting a Will.

Alfred Ip  08:00
And apart from due execution, of course, there are other problems that means around the execution or the drafting of the Will such as was the person who signed the Will had mental capacity. Mental capacity is often an issue, especially when the Will was made to deathbed or after the person discovered that he has some serious illness or life-threatening illness. This is particularly the case when the Will was signed in the hospital, when the person who was making the Will was already subject to various medical treatments, and the medicines may compromise their consciousness or their mental capacity. Sometimes, you know, when the person is subject to medication, they can be better, they can be worse, and sometimes they are, seems to be functioning normally, but other times they just sleep and sleep. There are a lot of times when the family comes to us and say it’s never possible for the person who passed away to make the Will on his deathbed when I saw him all the time, and she was always very sick. But that doesn’t mean that the person who signed the Will did not have the mental capacity at that time. Because even sometimes when the person is on their death bed and he cannot speak, all he has to do is to move his finger and indicate that he understands the instructions. We come across cases when the lawyer was asking the patient: you understand what I mean? If you understand tap one, if you do not tap two, and the patient would tap one. And then he asked further questions: do you understand that you’re making a Will, he tapped once and then do you understand the contents of it? He tapped once. So, all this should be documented, but it doesn’t of course, doesn’t mean that the person indeed had mental capacity, he may just tap. So, it very much depends on the circumstances when we are talking about testamentary capacity. But the golden rule is that when the person is about to die, or is at an age that is so old, that is always safe to have a doctor attesting the Will and confirming the mental capacity of the patient before he signed the Will. Of course, there are other grounds such as knowledge and approval, fraud, and undue influence, forgery, or revocation. All these are potential grounds that we can discuss later when doing this podcast.

Geraint Ho  10:51
Right, it sounds like there are some very complex factual matters that have to be taken into account when somebody wants to challenge a Will. Does that mean that these sorts of challenges are usually very difficult to succeed in court? And what are sort of some of the main hurdles?

Alfred Ip  11:09
Yes, I can share with you some of the experience that we had. The major hurdle that a lot of clients face is that he or she was not there, when the deceased made the Will, for example, he did not know the Will come about after the person passed away. He didn’t know who basically orchestrated the whole making of the Will. That would be difficult to show that the person who arranged the whole Will to be made, indeed exerting fraud or undue influence that believe he had, for example, a carer who has been looking after an elderly, in the last years of his life and after he passed away, certainly the family member discovered that there as Will. And the carer apparently is the only beneficiary under the Will, that means that the family members are totally disinherited. Of course, the family members will have doubts, and they will wonder, why would the deceased leave everything to the carer. And, of course, the carer may come about and say, all the deceased complained to me that, the family members ignored him and they didn’t look after him, didn’t pay attention to him, the deceased was very dissatisfied or very disappointed about the family members, and they only come about after he passed away, and only going for his money. This is a very typical or soap-operish legal dispute. And it would be up to the family members to show that actually the carer in the course of taking care of the elderly, he or she did do something to make the elderly making the decision. She could be brainwashing or keep infusing the mind with oh the family members is not looking after you. Where are they, what are they doing now? Why are they not coming to see you and things like that… It may or may not be undue influence, but what is it for the family members to show that the carer did say these things to the elderly, because, of course, he or she wasn’t there when the carer said these kinds of things to him. So, this is the difficulty that a lot of people face when they’re challenging the Will. But of course, the court does understand this, and it will be up to the person who tries to prove the Will to show that the Will is properly executed, is valid and legal. And this is what we call to prove the Will in solemn form. And that is the reason why a lot of people do not understand what is the evidential burden to prove a Will. But of course, it doesn’t mean that it is not difficult to challenge a Will because at the end of the day, a Will is a legal document, especially when it is drafted and attested by legal professionals who have experience in attesting the Will because he or she should know what it is like to make a Will valid.

Geraint Ho  14:31
And it sounds like a lot of the main hurdles or difficulties from potential claimant is to actually gather the evidence in relation to this potential challenge. So if I’m a potential claimant, is there anything I can do to sort of build up evidence to strengthen my case, because you know, as a lawyer, my understanding is that the strength of your case is very much dependent on the strength of your evidence.

Alfred Ip  14:58
Yes, and the first thing is to carry out investigation. Carrying out investigation involves (actions) such as seeking a copy of the Will and, if necessary, seeking the underlying documents pertaining to the Will. A lot of people do not understand that, um, apart from the Will, there might be other documents that indicate the deceased wishes. And in that respect, we have come across cases when, for example, the lawyers note – the note that was taken by the lawyers at the time when they take instructions in preparing the Will, or other documents such as some deceased handwriting. We come across a case that an elderly actually had written what he or she wanted, before making the Will and handed it to the lawyer before the lawyer drafted the Will for him. And without knowing all this evidence it’s difficult to assess, how likely is it Will can be challenged, and whether the Will reflects the wishes of the deceased. And this is the reason why sometimes it is difficult to get all these documents. And the lawyers’ role is to help the client gathering all this by asking the right questions.

Geraint Ho  16:17
Right. And you mentioned about how someone can obtain documents from the lawyer who was involved in preparing the Will. Now if I was that lawyer who prepared the Will my first reaction when I receive a request for disclosure of documents would be that I have I owe the duty of confidentiality to my client. As a claimant is there any way I can get around this when the solicitor says I have a duty of confidentiality?

Alfred Ip  16:43
Well, don’t forget duty of confidentiality is towards the client. Who is the client? The deceased in the context of a Will. And after the deceased passed away, whether there is this duty of confidentiality? If there is, who’s this duty owed to, from the lawyer who drafted the Will, to whom the duties owed to? If there’s any doubt as to whether he or she should you disclose the document to the person who requesting it, the answer is that in Hong Kong, there’s cases that can be followed, and it is up to the court to decide whether such disclosure should be ordered. And the person who is holding this information should assess whether it is likely for the court to order this information to be disclosed. I would say that the lawyer who drafted the Will should be careful  entertaining this kind of request from any person who seeks this kind of information.

Geraint Ho  17:48
Right. So that does sound like an extra layer of complexity if we have to bring this sort of application or investigation. So, does that mean that challenging a Will can potentially turn out into a very lengthy and drawn out legal battle that would take years and years to be resolved?

Alfred Ip  18:07
Yes, indeed, just like any other civil litigation, it takes years for a dispute to be resolved through legal process, so we always advise clients on the desirability to resolve this dispute through other means, such as mediation, or even private dispute resolution.

Geraint Ho  18:25
Right, and how often is it that parties end up settling a case and not letting it go all the way?

Alfred Ip  18:31
Actually, according to our experience, more than 90% of the cases settled, or resolved one way or another without going through the whole trial.

Geraint Ho  18:40
Oh, that’s good to hear. But at the same time, I can also think of a potentially unfortunate consequence, if parties decide to have to go all the way and spend years on this. Now, I’m going to pose a situation to you. If for example, I am the widow of the testator in question and for example, I’ve just been a housewife all my life, and I’ve only I’ve not been working, I’ve only been getting a monthly allowance from my husband for my expenses and spending money for groceries, and so on and so forth. And now I’m getting caught up in this lawsuit with regards to challenging my husband’s Will. Does that mean that I’m not getting any allowances for years while this case plays out in court? Because I’ve all been getting money from my husband and his estate is now locked up because of this court battle.

Alfred Ip  19:30
Oh, well, it very much depends on how the Will was drafted. If the Will was drafted that you are disinherited from the Will for one reason or the other, then the first thing that we’ll have to advise you to do is instead of challenging the Will to launch another proceedings under Inheritance Provision for Family and Dependants Ordinance that is Cap. 481 to seek your right of entitlement under the estate and it is a little bit shorter in terms of process, because in the proceedings, we can ask for interim provision from the estate to look after your financial needs in the interim. So, um, there are many ways to bring about challenging a Will or an estate. It is important to be properly advised and have a different strategy when you’re dealing with a situation.

Geraint Ho  20:25
Right. And I’m also thinking of another situation now, where if a testator has liabilities right before he passed away, will his creditors have any relief in terms of getting their debts paid in the interim?

Alfred Ip  20:42
Absolutely. The first thing that you need to do is to secure the interest in the estate that the liability will be repaid before any distributions is made to the beneficiaries. So, the creditor should ask the executor or the administrator, to make an undertaking to them to pay all the liabilities. And in that respect the first thing, again, is to file a caveat, in order to identify the person who is going to administer the estate, and once the person is identified, seek an undertaking from him or her in order to secure the interest and in that respect, I want to add that after a person passed away, the administrator, or the executor has a responsibility to administer the estate, and after calling in all the assets of the deceased, the first thing that comes out is the testamentary expenses, and the funeral expenses, and then it’s the tax and then it’s repayments to creditors – secure creditors and unsecured creditors. After all these are paid, the beneficiaries will only be entitled to the estate, if there’s anything left.

Geraint Ho  21:59
Right. That’s a very comprehensive explanation. I just want to step back a little bit, because you mentioned that the widow can bring a claim under the IPFDO, could you take us through a little bit about that?

Alfred Ip  22:10
Yes, actually, the widow is only one of the nine categories under that ordinance who is entitled to bring a claim. But then there are only a few categories of people who can bring a claim without showing that he or she has been a dependent: that is the spouse and minor children, because they are expected to be the dependant in the estate. And in order to bring a claim against the estate, they don’t need to show that they have been receiving financial support from the deceased otherwise, any other person in other categories have to show that they have been financially maintained by the deceased. And these categories of people involve adult children, other relatives or any other person who has been financially maintained. In that case, that means that basically, anyone who has been receiving money from the deceased during his lifetime, can bring a claim. It is fairly wide, but of course, the evidential burden is also very high. They literally have to show his or her relationship with the deceased, and the fact that he or she has been receiving maintenance from the deceased during their lifetime. And after the deceased passed away, they have financial difficulties that such financial maintenance should continue.

Geraint Ho  23:36
Right, now I’ve heard you mentioned that anybody who is a dependant or who can prove that they’re dependant can get a claim out of this ordinance. Well, forgive me for saying this, but from a moral perspective, would it be fair for the estate to actually have to pay out to somebody who isn’t part of the deceased family?

Alfred Ip  23:58
Well, it very much depends on the circumstances. But think about it, if a person who has been receiving financial support from another person, and their financial support suddenly ceased, and that person becomes despondent, he or she doesn’t know how to live and Hong Kong is a very expensive place, is actually very important to offer that dependant some sort of protection in order for him or her to carry out his/her life. How much should he or she receive is a matter for the court to decide, but he or she should at least have some sort of financial relief, so that she/he can carry on her/his life.

Geraint Ho  24:42
The very interesting take, Alfred, and that does make sense. So, stepping back a little bit into the court proceedings. If a court at the end of the day has to make a decision on the Will, what sort of outcomes are there usually?

Alfred Ip  24:59
Well, the Court will either rule that the Will is valid or invalid.

Geraint Ho  25:07
So that’s a very straightforward, yes-no type of answer…

Alfred Ip  25:11
In a way it is. But of course, it may not be totally black and white, the court is under the power to order that particular clause is not valid, or interpret the Will in a way in order to carry out the testator’s wishes.

Geraint Ho  25:29
Right. And also another situation, if I’m a claimant, I’m challenging a Will and my reason for this is because I do not think this Will in question is the valid one, and I want to prove another Will. Can I do that in the same proceedings? And does that turn into a sort of contest as to whose Will is the valid one?

Alfred Ip  25:51
Yes, of course. Um, but of course, it becomes more complicated because not only you have to show that the other Will is invalid.,. but also you have to show that the other Will is valid. So it’s like double the effort.

Geraint Ho  26:03
Right. So it’s, it seems as though the burden of proof now goes back to me trying to prove my version or my Will.

Alfred Ip  26:10
Correct. And that’s exactly the situation when the court has to deal with the Will of Nina Wang. If you remember, Tony Chan came forward and tried to prove that the Will leaving everything to him is a valid one. Chinachem Foundation sought to disprove the Will of Tony Chan and to prove that the Will leaving everything to the charity is indeed on the Will that is valid. And at the end Chinachem Foundation won, but then later on, the court decided that DOJ comes in and interpreted the Will that Chinachem Foundation is indeed the trustee, not a beneficiary. This is probably the most influential case in Hong Kong in the past years, especially with someone that is so legendary.

Geraint Ho  27:02
Interesting that you mentioned a very high-profile case just now, Alfred, because I think we all want to avoid long and high-profile legal battles, like what Nina Wang had to go through.

Alfred Ip  27:14
Yes, indeed, especially when she was trying to prove her husband’s Will and went into years-long legal battle with her own father-in-law, and then made the Will that is subject to challenge.

Geraint Ho  27:28
Right. And speaking of going to a legal battle with your own family members, wasn’t there a case about Anita Mui and the estate of Anita Mui and her mother?

Alfred Ip  27:38
Yes, the mother was trying to challenge the Will that she made in her deathbed. And it is a very sad case, because the mother claims that the provision given to her was not enough to provide for her, with her what can be described as a lavish lifestyle. It is very sad, and this is the importance of communicating your wishes to the family members in order to avoid these kind of disputes from happening in future.

Geraint Ho  28:08
That’s a very good point, Alfred. And I know you’ve might have mentioned some of this before, but could you just sort of recap some take home points for us as to how we should do our estate planning or how we should have our Wills prepared to avoid these kind of disputes?

Alfred Ip  28:23
Well, first of all, it’s important to have the Will properly made. And don’t wait until you realize that you’re about to pass away to make a Will because there’s often an extra layer of complication. And secondly, seek professional advice. A lot of people have the misconception that making a Will is very easy, and they want to avoid spending money on it. But the money that you spend on making a Will properly can save a substantial amount of money for people challenging the Will in future. All you have to do is to get it properly done. And it is such an important decision, involve your family. Explain to your family why you have such a decision so that your family can come to make peace with it. I think it’s very important for the family members to hear it from yourself, what you want to do with your estate, and why you want to do it. And if the family members have any problem, voice it out when you’re still alive, so that they won’t have to fight over your estate after you passed away. It’s literally leaving a big problem for your family members to deal with. That is not a show of love.

Geraint Ho  29:47
Thank you, Alfred. That’s very sensible advice.

29:52
Tune in and listen to more episodes of The HIP Talks podcast by checking the insights section at our website at www.hugillandip.com and our channels on Apple PodcastsSpotifyGoogle Podcasts and Stitcher. They are also available on Hugill & Ip’s YouTube channel. You can send comments and feedback to our email address hello@hugillandip.com. If you found the HIP Talks interesting, please share them with friends, family and business associates.

This podcast is for informational purposes only. Its contents do not constitute legal or professional advice.

Alfred Ip

Alfred assists high net-worth individuals (HNWIs) in handling their wealth-related issues, such as contentious and non-contentious trust and probate, mental capacity, family office, amongst other wealth management matters. He is also a leading Dispute Resolution lawyer with over 20 years of experience in Hong Kong. Moreover, Alfred helps clients with issues regarding Family Law.

All articles by : Alfred Ip
Privacy Preferences

When you visit our website, it may store information through your browser from specific services, usually in the form of cookies. Here you can change your Privacy preferences. It is worth noting that blocking some types of cookies may impact your experience on our website and the services we are able to offer.

For performance and security reasons we use Cloudflare
required
Google Analytics tracking code disabled/enabled
Google Fonts disabled/enabled
Google Maps disabled/enabled
video embeds (e.g. YouTube) disabled/enabled
 
View our Privacy Policy
We don't eat shark fin but our website does use cookies, mainly for analytics and provision of content from other websites. Define your Privacy Preferences and agree to our use of cookies. Privacy Policy