PLE5016 Wills and Probate Practice Notes

PLE5016 Wills and Probate Practice
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Semester A Exam notes
By Chan Chun Sang, Jason (#51092610) A003
(v01/12/2010 23:00)
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LG1 - Introduction..............................................................................5
General principle.........................................................................5
Requirements of a valid will.........................................................5
1. Formalities in compliance with the s5 Wills Ordinance. . .5
2. Animus testandi (intention to make a will).....................7
3. Testamentary capacity....................................................8
Exceptions to the formalities as provided in s5 WO....................9
Alternate compliance under s5(2) WO.......................................10
Incorporation by reference........................................................10
Revocation (s13 WO).................................................................11
1. By marriage (s15 WO)...................................................11
2. By another will or codicil...............................................11
3. By destruction...............................................................11
Alteration (s16WO)....................................................................12
Rectification (s23A WO).............................................................13
Republication (s5 WO)...............................................................13
Revival of a Will.........................................................................13
Codicil........................................................................................13
Relevant statutes.......................................................................14
Section 5 Wills Ordinance - Signing and witnessing
of a will...................................................................14
Section 10 Wills Ordinance - Avoidance of gifts to
attesting witnesses and their spouses....................14
Section 11 Wills Ordinance - Creditor attesting will
charging estate with debts admissible as witness..14
Section 15 Wills Ordinance - Effect of dissolution or
annulment of marriage...........................................15
Section 16 Wills Ordinance - Alterations in will after
execution................................................................15
Section 19 Wills Ordinance - Will to speak from
death of testator.....................................................15
LG2 & 3 - Will drafting, gift planning and administrative provisions 16
General provisions.....................................................................16
Component of a will (the usual clauses)....................................16
1. Identification clause......................................................16
2. Revocation clause.........................................................16

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3.
4.
5.
6.
7.
8.
9.
Domicile clause.............................................................16
Appointment of executor clause...................................17
Professional charging clauses.......................................17
Appointment of testamentary guardians......................18
Minors receipt clause....................................................18
Charities clauses (Receipt and cypres).........................18
(a)
The charities receipt clause..............................18
(b)
The Cy Pres clause...........................................19
Disposition of gifts clauses............................................19
(a)
When drafting a will there will be different gifts.
19
(b)
Four types of gifts:...........................................19
(c)
Whether gift are vested or contingent?............21
(d)
Class gift...........................................................22
(e)
Who is responsible for expenses arises from the
gift?
22
(f) If the gift of property is subject to a charge then who
shall pay for the charge?..............................................22
10.
Administrative provision clause..............................23
11.
Attestation clause...................................................26
Failure of gift..............................................................................27
Trust for sale..............................................................................28
LG4 - Intestacy.................................................................................29
Intestacy circumstances............................................................29
The priority to distribution under intestacy (s4 IEO)..................29
Characteristics of beneficiaries.................................................30
1. Surviving spouse...........................................................30
2. Issue..............................................................................30
Right of appropriation (s7IEO and s68 PAO)..............................30
Statutory trust for sale under s62 PAO/s6 IEO...........................31
1. Statutory trust for sale..................................................31
2. Power to raise statutory legacy through sale (s6 IEO). .32
Hotchpot rule (s5(1)(c) & s8 IEO)..............................................32
1. s5(1)(c) IEO Hotchpot rule (Applies only to issue)........32
2. s8 IEO Hotchpot rule under partial intestacy (Applies to
both spouse and issue).......................................................33

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Appointment of matrimonial home by spouse (s7 IEO).............33

1. Power of appointment...................................................33
2. Procedure for election by spouse..................................33
3. Limitation on election...................................................34
Commorientes rules..................................................................34
Intestacy under foreign law.......................................................35
LG5 - Grant of probate.....................................................................36
Document of reference for probate...........................................36
Abolishment of Estate Duties and its effect to probate.............36
Application for probate..............................................................36
Letter of Administration.............................................................37
How to apply for grant?.............................................................39
1. Where the deceased left a valid will.............................39
2. Where the deceased left no valid will...........................40
3. Surety...........................................................................42
Capacity and number of personal representative......................42
1. Capacity........................................................................42
2. Number.........................................................................42
Changes to grant.......................................................................42
Death or renounciation of executor...........................................43
1. Renunciation of the right to a grant of representation
before grant........................................................................43
2. If before the death of the executor he has not totally
dispose of his duty..............................................................43
(a)
Chain of executorship (s34 PAO)......................43
(b)
Grant in respect of unadministered property
(grant de bonis non administratis)................................43
Documents that needed to be filed for an application of grant. 44
1. Commonly used specified forms:..................................44
(a)
HAD forms........................................................45
(b)
Probate Registry forms.....................................45
2. Documents to include for application of grant..............47
Small estate administration (Net assets = cash < $50,000)
(s60K PAO).................................................................................47
Summary administration (Net assets = cash < $50,000) (s15
PAO)...........................................................................................48

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Safe deposit box of the deceased (After 11 February 2006).....48

1. Inspection(s60D PAO)....................................................48
2. Removal of items (s60E PAO)........................................49
Relevant statutes......................................................................50
Rule 19 Non-Contentious Probate Rules - Order of
priority for grant where deceased left a will...........50
Rule 21 Non-Contentious Probate Rules - Order of
priority for grant in case of intestacy.....................51
Part II to Schedule 1 of Probate Administration
Ordinance - Order of application of assets where the
estate is solvent.....................................................52
LG6 - Administration of estate.........................................................53
Assets........................................................................................53
Debts, funeral, testamentary or administration expenses........55
Distribution................................................................................56
Power of the personal representative..............................................59
1. Power to postpone distribution under s71 PAO.............59
2. Power of appropriation under s68 PAO..........................59
3. Power of maintenance under s33 TO............................60
4. Entitlement to income of a contingent interest under s33
TO 60
5. Power of advancement under s34 TO...........................61
6. Power of investment under s4TO..................................62
7. Power to appoint trustees of infant's property under s69
PAO63
8. Co-ownership of property by the deceased with others63
(a)
If the deceased co-owned a property with
another under Joint Tenancy, then:...............................63
(b)
If the deceased co-owned a property with
another under Tenancy in Common, then:....................64
9. Shares as part of estate................................................64
10.
Payment of debts by solvent estates......................64
11.
Relevant statutes....................................................65
Section
4
Trustee
Ordinance
Authorized
investments............................................................65
Section 71 Probate and Administration Ordinance -

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Power to postpone distribution...............................65

Section 64 Probate and Administration Ordinance Charges to be paid primarily out of the property
charged...................................................................65
Section 68 Probate and Administration Ordinance Powers
of
personal
representative
as
to
appropriation..........................................................66
Section 33 Trustee Ordinance - Power to apply
income for maintenance and to accumulate surplus
income during a minority........................................68
Section 34 Trustee Ordinance - Power of
advancement..........................................................69
Inheritance (Provision for Family and Dependants) Ordinance........71

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LG1 - Introduction
General principle
Testamentary freedom - Nobody can restrict a testator in making
his/her own will.
Definition of a will - A will is a declaration which contains the
testator's express wishes to be taken effect upon death. In rule,
always the last will take effect provided it satisfied the requisite
requirement for a will.
Any beneficiary who has interest in the will does not own that
interest until the testator die.
A will enable appointment of testamentary guardianship of
infant children. e.g. In case of unmarried couples who had

children, in case if one dies under law the other does not have
guardianship of their children. A will could appoint the
guardianship to the other to take care of the child.
The meaning of spouse constitute the other half of a legal
marriage recognised in Hong Kong. e.g. Since gay marriage
which are recognised in USA is not recognised in Hong Kong, so
if these couple are in Hong Kong and one dies intestate the
other is not recognised as a legal spouse in Hong Kong.
Donatio Mortis Causa (aka Death Bed Gift) is an intervivos gift,
requirement as follows:
Contemplation of death
Conditional upon death taking place
Gift must be able of passing as a valid DMC
Requirements of a valid will

i.
Formalities in compliance with the s5 Wills Ordinance
Strict requirement. Must be written and executed in
accordance to the statutory formalities unless fall under
certain exceptions (eg Privilege will under s4/s6 WO).
According to s5WO, no will shall be valid unless:
In writing;
There is no requirement that a will must be drafted
by lawyer.

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The will could be written on any medium. (e.g. on

egg shell in Hodson v Barnes)
So long as the will is being written in a human
language it would be recognised by the court. (e.g.
French in Whitting v Turner, Jewish in Re Berger).
If the will is written both in pen and pencil, the pen
part would take effect but the pencil part would
merely be taken as deliberative and would not be
taken as effective. (Re Adams [1990] 2 All ER 97).
Appears that the testator intended by his signature to
give effect to the will;
Whatever form of signature by the testator
personally suffice. The crucial element is the

intention of the testator.
Any sign or even an incomplete signature suffice
(In the Goods of Chalcraft [1984] P222)
e.g. in Re Cook the testator signed as "Your
Loving Mother" instead of her usual signature
and this was acceptable.
Logically the signature should be on the bottom
of the will, but testator could sign anywhere.
(e.g. at the attestation clause in Weatherhill v
Pearce [1995] 2 All ER 492)
Therefore, where there is an intention to sign by
the testator no matter how he/she sign it the
court would recognize. Court is quite liberal in
the sense of recognizing the signature of the
testator so long as he/she personally signs it
with the intention to give effect to the will.
Testator signed on the will in the presence of 2 or more
witnesses present at the same time or the testator
acknowledged his signature in the presence of 2 or more
witnesses; and
Required minimum of 2 attesting witness with no
interest in the estate (s10 WO)
No beneficiary may act as witness unless

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supernumerary (s10 WO)

If so, any gift to the beneficiary witness would
be void, and the will would take effect as if those
gifts are not provided.
An executor may act as witness (s12 WO).
The solicitor executor who also acted as witness
cannot charge fees, even with a charging clause
in the will under the operation of s10WO, unless
the solicitor is supernumerary to the witnessing
requirement.
If the testator signed before the witness can see him
sign, then either the testator himself and also the
witness can acknowledge the testator's signature

(s5(1)(d)(ii) WO). In that case need not to have an
attestation clause.
Witnesses attesting signature by the testator prove
that it was signed by the testator. As long as the
witnesses see the testator sign or the testator
acknowledged to the witnesses that he had signed
suffice.
Witnesses need not know the content of the will.
Each witness either attests and signs the will or
acknowledges his signature in the presence of the
testator but not necessary in the presence of other
witnesses.
Witness must sign in the physical and mental
presence of the testator. (see line of sight argument
in Casson v Dade)
Attestation clause
A will without an attestation clause is not fatal;
but must file affidavit/affirmation of due execution
(Form W3.1) by the witnesses at application for
representation to prove due execution (NCPR 10);
takes extra time and expenses.
ii.
Animus testandi (intention to make a will)

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A requirement of intention, not a requirement of the

capacity of the testator.
The testator must have testamentary intention to make a
will. (s5WO)
In any case, the testator in signing the will must have
intention to give effect to the will.
e.g. In Wood v Smith the fact that the testator wrote the
will by himself and pointed to his name on the will to the
attesting witnesses as his signature signifies the
testator's intention to give effect to the will even though
he did not sign it.
Further, in Weatherhill v Pearce when the testator
written her name on the attestation clause and point out
to the witness that that was her signature also suffice.
We can see with both cases the court recognized that by
the testator's name on the will there was testamentary
intention on the testator.
Knowledge and approval
There is a rebuttable presumption that a person with the
necessary testamentary capacity, knew and approved
the contents of the will when he signed. (d'Eye v Avery
[2001] WTLR 227) The presumption does not apply
where the testator is illiterate or blind or has no
knowledge of English;
The Probate Registry would require further
evidence from an application of a will executed
by a blind or illiterate testator. (NCPR11)
If will drafted in English but the testator have
limited/no capacity in understanding English,
must change attestation clause to show will is
translated to the understanding of testator.
where suspicious circumstances exist in relation to
the preparation of the will.
This can happen when the person who prepared the
will (the drafter)
took a substantial benefit himself (Wintle v Nye

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[1959] 1 All ER 552) or

where the will benefited a third party, for
example, the solicitor's daughter in Thomas v
Jones [1928] P 162.
When the testator signs a will, he/she must know what
he/she sign.
Normally, solicitor would ask the testator before
signature to read the will and ask if he/she know or
accept the content of the will.
In case of mistakes:
to the whole will - No knowledge and approval even
though will drafted in very similar terms (In b Hunt)
to words used but not their legal effect - There is
iii.
knowledge and approval even if the testator point

out the problematic part and the solicitor gave
mistaken explanation. (Collins v Elstone)
to part of will - If the testator does not appreciate
the legal effect then no knowledge and approval.
(Re Phelan)
by draftsman - typo in will means no knowledge and
approval so relevant clause deleted or rectified.
Testamentary capacity
The testator must possess the requisite testamentary
capacity when:
He gives instructions for the preparation of the will;
He had knowledge of the legal effect of the will and
approved its contents; and
On execution of the will
Age of the testator must be over 18 when he made the will,
but subject to s4 and 6 WO.
Mental capacity
Test - Bank v Goodfellows (Sound mind, sound memory
and sound understanding. In simple words the testator
must know what he/she is doing.):
The testator must understand the nature and effect

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of what he/she is entering into.

The testator must know what he owns and owes.
The testator must understand the others who are
entitled to benefit under his intestacy but do not
benefit in the will might claim the estate.
A will may be valid even if the testator has lost
testamentary capacity by the time the will is executed
provided (Parker v Felgate (1883) 8 PD 171):
The testator had capacity when he gave instructions
for the preparation of the will;
The will was prepared in accordance with those
instructions; and
When the testator execute the will, he remember
giving instructions and believe the will has been

prepared in accordance with those instructions.
Presumptions on mental capacity:
If the will appears rational and is properly executed.
The testator's mental state continues until proven
otherwise.
The will must be a record of the testator's own volition.
If the will is made under influence from the others, there
might be undue influence which invalids the will.
However, mere persuasion is not undue influence.
Fraud vitiates testamentary capacity (Butterfield v
Scawen)
Suspicious circumstances - When draftsman draft will
and a large part of the estate goes to the benefit of the
draftsman , probate will not be granted until such
suspicious circumstances is removed.
Exceptions to the formalities as provided in s5 WO

Statutory requirement of a valid will (s5(1) WO) must be strictly
complied. Exception:
Substantial compliance proved under s5(2) WO. (Extremely
hard to prove.)
Privileged will that satisfied s4/s6 WO - In this case, oral will

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is valid and no requirement of witness. Testator must still

possess the requisite animus testandi (Compare Re Knibbs
(No)/Re Stable (Yes)) and mental capacity.
Alternate compliance under s5(2) WO
s5(2) WO provide for alternate compliance if formalities stipulated in
s5 WO was not complied with.
If there is a document which reflects the testamentary
intention of the testator, then some of the requirements of
section 5 WO would be satisfied. In that case, can apply to
the court for probate with that document.
e.g. In the situation if client put down written instruction and
have signed the instruction for preparation of a will but
before the will is executed the client died, could the written
instruction operated to become a valid will as substantial
compliance to s5(2)?
As there was clear testamentary intention, the written
instruction might be argue as substantial compliance
notwithstanding there was no witness to the
instructions.
Have to apply to court and let the court decide.
If the court decide that the written instruction is
substantial compliance under s5(2) WO, then the
instruction would be treated as a will and therefore
could apply for a grant of probate.
Incorporation by reference
A document (e.g. memorandum or list) can be incorporated into
a will by reference only if the document:
is clearly identified by the will;
exist at the date of the will;
must be referred to in the will as being in existence.
If incorporated into will, that document would be annexed to will
for application of representation. The document then would
become part of the will.
If the testator at date of execution wishing to incorporate an

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additional document into will, then might need to make codicil.

If the document cannot meet all three requirements to be
incorporated into will, then the gift that has been set aside to be
distributed under that document shall fall into residuary estate
but if the gift set aside is already residue then shall fall into
intestacy.
Revocation (s13 WO)

Must have intention to revoke (animus revocandi). The intention
to revoke carries the same weight as intention to make will.
Can revoke either whole or part of a will.
Revocation can also be done by third party but must be done in
1.
presence of the testator (in b Dadds)

By marriage (s15 WO)
s14(3) WO Exceptions
If the will made in contemplation of marriage then no
revocation.
However if contemplated to marry one and
subsequently married another then revocation effective.
There is no time limit for the contemplation.
ii.
By another will or codicil
iii.
By destruction
A will would be revoked "by the burning, tearing or
otherwise destroying of it by the testator, or by some person
in his presence and by his direction, with the intention of
revoking it." (s13(1)(d) WO)
To revoke the will need the intention coupled with the
act of destruction. (Cheese v Lovejoy)
A will can be revoked by the action of a third party
under the direction of the testator provided it is carried
out in his presence. (Re Webb [1964] 2 All ER 91)
However, merely cutting out the signature part from the
will suffice (Hobbs v Knight)
Accidental destruction is not effective revocation as
there was no intention of destruction (In the Estate of
Southerden [1925] P177)

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D. Perkes v Perkes (1820) - A will torn in 4 pieces and

preserved by a third party was held to be valid because
the court construe that the testator did not did sufficient
enough for the court to infer that there was intention of
revoking it. Revocation by destruction is only effective if
the testator has completed the intended act of
destruction. In addition, it would be evidence in support
of the validity of the will if the purported destroyed will
was possessed by a third party instead of the testator
Courts quite liberal to interpret whether act of destruction is
complete to preserve the effect of the will.
Presumptions on destruction by the testator:
If a will is known to have been in the testator's
possession is not found on the testator's death, it is

presumed to be destroyed with the intention to revoke.
If a will is found in the testator's possession at his death,
but it has been burnt or torn or otherwise destroyed,
then it is presumed that the testator destroyed the will
with the intention to revoke.
If the remains of the will was duly executed, probate may be
obtained with the torn will by filing Form W3.3 Affirmation of
Plight and Condition of Will to testify the condition of the will
as found under NCPR 13 and 14.
Alteration (s16WO)
Only allowed under s16 WO.
s16 WO provides that alterations made after the will is executed
are invalid unless executed by the testator in the manner in
which he could validly execute a will when the alteration was
made, or by execution , in the same manner, of a memorandum
referring to the alteration and written in some other part of the
will.
Presumption is that alteration made after execution, thus invalid
unless proved otherwise.
When an alteration is invalid, the will is construed as if the
alteration had not been made.

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Alterations made before the will is executed are effective.

However, alterations to a will are presumed to be made after the
will has been executed, unless there is evidence to the contrary.
for example, inserting the date in a space left for that
purpose or other evidence - perhaps from witnesses - to
show the alteration was made before the will was signed.
For this reason, when a will is altered before it is
executed, the testator and witnesses are usually asked
to sign or write their initials in the margin close to the
alteration.
If words are altered by complete obliteration (erase or cover
up by tipex), however, the will is construed without the
inclusion of the words
obliteration is not executed
If will contains alteration,
representation have to file an
NCPR 12 and 14. (Form W3.4)
obliterated even though the

in the same manner as the will.
on application for grant of
affidavit as to alterations under
Rectification (s23A WO)

By reasons of clerical error or the failure to understand the
testator's instructions. (s23A WO)
Cannot speculate on the testator's intention.
Republication (s5 WO)
Remake new will or make a codicil.
A codicil is a testamentary instrument supplementary to the will.
It is being executed when the testator wants to make a slight
alteration to a will by amending, adding to or revoking part of an
existing will.
Codicil does not stand on its own, must refer to a clause of the
will.
If there are too many modification desired on the will, good
practice is to advice making of a new will rather than modify
with codicil.
A codicil republishes the will, so the effective date of the will
would become the same as the codicil.

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Revival of a Will
May be by re-execution or through a codicil that shows an
intention to revive will.
Will must be in existence.
Revival takes effect at the day of revival
Codicil
The crucial element of a codicil must contain the confirmation
clause - "In all other aspects I confirm this will" or "In all other
aspects I confirm my will dated..."
A properly executed codicil would in effect republish the will on
the date of the codicil. (s5(2) WO) In other words, as the will was
published at an earlier date than the codicil, the effect of the
codicil is to give the will a later date ie the date of the codicil.
What happen if between the time of the will and codicil the
testator had acquired/disposed properties?
As the will take effect at the date of codicil, everything will take
effect at the date of the will, so the will shall deal with the
assets at the time of the codicil instead of the original date of
the will.
Relevant statutes
Section 5 Wills Ordinance - Signing and witnessing of a will
(1) Subject to sections 6, no will shall be valid unless(a)
it is in writing, and signed by the testator, or by some other person in

his presence and by his direction;
(b) it appears that the testator intended by his signature to give effect to
the will;
(c)
the signature is made or acknowledged by the testator in the presence

of 2 or more witnesses present at the same time; and
(d) each witness eitheri.
attests and signs the will; or
ii.
acknowledges his signature, in the presence of the testator (but not

necessarily in the presence of any other witness), but no form of
attestation shall be necessary.

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(2) A document purporting to embody the testamentary intentions of a deceased
person shall, notwithstanding that it has not been executed in accordance
with the requirements under subsection (1), be deemed to be duly executed
if, upon application, the court is satisfied that there can be no reasonable
doubt that the document embodies the testamentary intentions of the
deceased person.
Section 10 Wills Ordinance - Avoidance of gifts to attesting

witnesses and their spouses
(1) If a person attests the execution of a will, and any disposition of or affecting
any property (other than charges and directions for the payment of any debt)
is given or made by the will to that person or his spouse, that disposition
shall, so far only as concerns the person attesting the execution of the will,
or the spouse of that person, or any person claiming under that person or
spouse, be void.
(2) The person so attesting shall be admitted as a witness to prove the
execution of the will, or to prove the validity or invalidity thereof,
notwithstanding such disposition.
(3) For the purposes of subsection (1) of this section the attestation of a will by a
person to whom or to whose spouse there is given or made any such
disposition as is described in that subsection shall be disregarded if the will is
duly executed without his attestation and without that of any other such
person.
Section 11 Wills Ordinance - Creditor attesting will charging estate

with debts admissible as witness
If by will any property is charged with any debt and a creditor, or the spouse of a
creditor, whose debt is so charged, attests the execution of the will, the creditor,
notwithstanding such charge, shall be admitted a witness to prove the execution
of the will, or to prove the validity or invalidity thereof.
Section 15 Wills Ordinance - Effect of dissolution or annulment of

marriage
(1) Where, after a testator has made a will, his marriage is validly dissolved,
annulled or declared void(a)
the will shall take effect as if any appointment of the former spouse as

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an executor or as the executor and trustee of the will were omitted; and
(b) any devise or bequest to the former spouse shall lapse, except in so far
as a contrary intention appears from the will.
(2) Subsection (1)(b) is without prejudice to any right of the former spouse to
apply for provision for maintenance under the Matrimonial Causes Ordinance
(Cap 179).
(3) Where(a)
by the terms of a will an interest in remainder is subject to a life

interest; and
(b) the life interest lapses by virtue of subsection (1)(b),

the interest in remainder shall be treated as if it had not been subject to the
life interest and, if it was contingent upon the termination of the life interest,
as if it had not been so contingent.
Section 16 Wills Ordinance - Alterations in will after execution

(1) No obliteration, interlineation, or other alteration made in a will after
execution shall be valid or have any effect, except so far as the words or effect of
the will before such alteration are not apparent, unless such alteration is
executed by the testator in a manner in which he could validly execute a will at
the time such alteration was made. (Amended 56 of 1995 s. 5)
(1A) For the purpose of subsection (1), the words or effect of a will are apparent if
they can be discovered by any means. (Added 56 of 1995 s. 5)
(2) The will, with such alteration as part thereof, shall be deemed to be duly
executed if the signature of the testator, and the signature of each witness if any
is required, is made(a)
in the margin or on some other part of the will opposite or near to such
alteration; or
(b) at the foot or end of or opposite to a memorandum referring to such

alteration and written at the end or some other part of the will.
Section 19 Wills Ordinance - Will to speak from death of testator

Every will shall, with reference to the property comprised in it, be construed to
speak and take effect as if it had been executed immediately before the death of
the testator, unless a contrary intention appears from the will.

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LG2 & 3 - Will drafting, gift planning and administrative

provisions
General provisions
When drafting will, must keep these in minds:
Take instructions of personal details and characteristics of the
testator (e.g. name, contact details, marital status, language
that testator speaks, read and write);
Take instructions of the testator's assets and liabilities.
Ascertain from testator whether there is exist a previous
will/codicil.
Appointment of executor - must advice the implication between
appointing a layman or a professional executor.
Administrative requirements e.g. power of maintenance &
advancement (s33, 34 TO).

Professional conduct concerns:
Unclear instructions (5.05 SG)
Instructions from a third party (5.06 SG)
Gift to solicitor or family or firm or staff (7.04 SG)
General duty of confidentiality (8.01 SG)
Potential negligence issue (e.g Instruction to solicitor but
testator died before execution because it took the solicitor
too long time to draft the will - White v Jones [1995] 2 AC
297)
Component of a will (the usual clauses)

1. Identification clause
Must appropriately identify the testator by name, address
and applicable ID.
If the testator has other name, must include.
Don't use passport number as they changes. Good
practice to use ID number.
ii.
Revocation clause
"I hereby revoke all my previous wills"
Although a will at a later date effectively revoke all older
will, best to express it clearly here.

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iii.
Domicile clause
"I declare that I am domiciled in Hong Kong"
Domicile is a question of fact
In effect to declare that the will is governed by laws of Hong
Kong
Grant is obtained first in the place of domicile.
Not fatal if no domicile clause
iv.
Appointment of executor clause
(a) Look for appointment of executor in the will, if no executor
appointed or the executor appointed was unwilling to act or
died, it is not fatal but does have the following deficiencies:
A grant of probate could only issued to the executor. If
no executor then could only apply for a Grant of Letter
of Administration with Will Annexed. (s35 PAO) There are
certain limitation to administrator when compared to the
power of executor:
Property in estate is vested to executor at the date
of death for probate while for other situations
property shall vest to the administrator at the date
of grant.
In case if the estate have minor or life interest, one
executor is enough but for administrator requires
two. (s25 PAO)
Therefore, advise client to appoint at least 2 executors
or a trust corporation or trustee bank as executor or at
least have a substitute appointment of executor.
(b) Characteristics of an executor
Must be 21 when they act.
Can appoint not more than 4 executors. (s25 PAO)
It is not fatal when at appointment the executor was not
yet 21, so long as when the duty arises he attain 21
suffice.
If appointed spouse as executor, later divorced would
renounce the spouse as executor. The will shall take

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effect as if any appointment of the former spouse as an

executor or as the executor and trustee of the will were
omitted. (s15(1)(a) WO)
(c) Appointment of trustees
"The expression "my Trustees" means my
personal representatives and the trustees of this
will for the time being"
Usually executors are also appointed as trustees of the
estate, but could appoint separately.
v.
Professional charging clauses

" Any of my Trustees who is a solicitor or accountant
may charge for work which he or his firm does
including work not requiring professional help."
Should contain charging clauses to enable professional
executor to charge fees as executor is a fiduciary so the no
profit rule applies.
If failure to include professional charging clause, the
professional executor shall not be entitled to fees for his
service unless with the consent of all beneficiaries who are
at least 18 and possess a sound mental capacity.
vi.
Appointment of testamentary guardians
"I appoint Mr. XXX of <address> to be guardians of
any of my children under eighteen."
For civil partnership or cohabitation, death of a partner does
not necessary grant the other legal guardianship, therefore
should provide for testamentary guardianship.
vii.
Minors receipt clause
An unmarried minor not in a civil partnership has no
statutory power to give good receipt for capital and income.
The purposes of minors receipt clauses is for discharge of
the personal representative's duty when he appropriate the
gift to the guardian or parent of a minor beneficiary who can

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give valid receipt on behalf of the minor.

Normal for the will to provide personal representatives the
authority to obtain a receipt from the minor's parent or
guardian
"I give HK$XXX to my son XXX of XXX and if at my
death he is under eighteen it may be paid to his
parent or guardian for his benefit or to the
beneficiary himself once he has attained eighteen.
Either payment shall be a discharge to my Trustees."
viii.
Charities clauses (Receipt and cypres)

1. The charities receipt clause
Unincorporated association might be problematic to give

good receipt.
The charities receipt clause is for discharge of the
personal representative's duty when he appropriate the
gift to a charitable organization and an official of that
charity could give valid receipt on behalf of the
organization. Normal for the will to provide personal
representatives the authority to obtain a receipt from a
person who appears to be an officer of the organization.
"The receipt of a person who appears to be a
proper officer of the Charity shall be a discharge
to my Trustees."
2. The Cy Pres clause
"This gift will not fail if at my death the Charity
has ceased to exist or has amalgamated with
another Charity or has changed its name and my
Trustees
shall
pay
it
to
the
charitable
organisation which they consider most nearly
fulfils the objects I intend to benefit."
the Cy Pres clause is for the occasion when the
deceased passed away the intended charitable
organization beneficiary ceased to exist therefore the
personal representative is empowered to give the gift to
another charitable organization with similar objective as

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the intended one.

If Cy Pres clause missing not fatal, as could pursue the
issue under common law and equity rules. (eg. Change
of name of the charitable organization - Hong Kong Bank
Trustee Ltd v Fu Chui Ying [1994] HKLY 598)
ix.
Disposition of gifts clauses
(a) When drafting a will there will be different gifts.
Disposition clauses stipulate which beneficiary gets
what from the estate.
Disposition could be immediate vesting of gift or
contingent upon certain conditions.
Devise and Legacy
Devise is a gift of landed properties or other realty
by will
Legacy is a gift other than devise
2. Four types of gifts:
Specific gift - a gift that is specifically described so as to
severe that gift from the testator's general estate.
A gift of an item of property owned by the testator
at the date of death. Usually are personal chattels.
The use of the word "my" signifies it is a specific
gift.
Compare with general gift, specific gift must be
identifiable and in existence at the day of death,
otherwise no gift.
If gift does not exist at death then the gift is
adeemed (s19 WO - will speaks from death unless a
contrary intention in the will)
Ademption only applies to specific gift.
If the beneficiary could not take the gift then falls
into residuary estate
Cost related to the delivery and insurance are borne
by the beneficiary receiving the gift unless provided
otherwise in the will.
General gift - A gift which does not identify in specific

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terms the personal estate gifted

The gift still valid even if the testator does not own
the gift at death.
Unlike a specific gift, there is an obligation on the
executor to use funds from the estate to purchase
gift or compensate the beneficiary the money
equivalent to the value of gift instead.
Ademption does not apply
Very little gift should be general.
Should advice for pecuniary gift instead
Demonstrative gift - a gift which there is a fund pointed
out to satisfy it. eg. gift of money from a specific fund
primarily a general gift
not adeemed if the fund has ceased to exist before
the testator's death
Residuary
Gift of all the leftover of the estate after satisfaction
of other gifts and debts.
If a residuary gift fail to vest on a beneficiary then
shall fall into partial intestacy.
Class gift
Provide the residuary or a part of is to be shared
amongst a class of people.
Class cannot be too wide and must be certain.
Automatic substitution of beneficiary at the
testator's date of death.
Since will speaks from the date of death
(s19WO), so the class will closed on the date of
death of the testator.
eg if the class is the children of the testator,
all the children living at the date of death of
the testator shall be entitled to the gift.
3. Whether gift are vested or contingent?
If the gift is vested and no contingency imposed on the
beneficiary it can be an immediate gift.
If the intended beneficiary is of full age, then the

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personal representative can distribute upon one

year of death. (s71 PAO)
Whether the gift is vested shall depend upon whether
the condition as stipulated in the will for the gift, if any,
is satisfied at all.
Therefore, a gift could still be vested to a minor, but
since he/she could not give valid receipt then must
consider appointment of trustee for that gift. (s69
PAO)
If the gift is a contingent gift, the gift shall be vested
upon satisfaction of such stipulated condition.
The stipulated contingency condition might not apply if
it is contrary to public policy.
If gift contingent upon the beneficiary attaining a certain
age:
If that beneficiary died before satisfying the
contingency for the gift to be vested on him, shall
fall into residue or even partial intestacy
Minor interest must know consider the power of
maintenance and advancement provided under s33
and s34 TO unless contrary intention provided in the
will.
In addition, sometimes the contingent gift generates
interest or income then who is entitle to that? e.g. if
the property is rental who is entitled to it?
Contingent gift always carried the right to income from
the date of death till condition met unless provide
contrary. (s33 TO)
Under s33 TO such income shall vest with the
beneficiary even if he ultimately could not satisfy
condition.
Could provide contrary to s33 TO - "The income
shall vest in capital" clause (p.37 DB #4). So if
the beneficiary does not meet contingency
condition, he shall not get any income.
Whether the gift is a life interest or a remainder-man

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interest?
Life interest means a interest in real property which,
according to the will, a party will receive only for the
lifetime of the person benefiting from that right.
A remainder man interest is the interest of a person
who shall entitled to inherit property upon the
termination of the life interest of another person in
the will. At death of the life interest holder, the
property involved in the life interest falls into the
ownership of the remainder man.
(d) Class gift
Gift to a class of persons, usually the children of the
testator.
If "my children" is used without reference to their
names, then it is class gift and class shall close upon the
testator's death. So children born after the testator's
death gets nothing.
Also if one of the children predeceased the testator,
then his/her share would be absorbed and
substituted automatically by other children living at
the date of the death of the testator.
In this case, s23WO would not operate to transfer
the deceased child's share to his issue.
Prudent to take instructions from testator as to how he
wanted his children to benefit, as different drafting
might achieve different effect that the testator desire.
Testator might want to benefit only the children in
existence at his death, or might otherwise include
children born after death. Must consider contingency
with testator.
When share of residue is quantified to each child (eg
Half to A, Half to B), if a child predeceased the testator,
gift fall into intestacy.
An accurer clause could prevent specific share from
failing by distributing the share to other beneficiaries.
"If any of the gifts set out above fails it shall

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be added proportionately to the gifts which do

not."
(e) Who is responsible for expenses arises from the gift?
e.g. what about the insurance on the gift who should
pay?
In general, it is the beneficiary who receives the gift to
bear the expense related to the transfer and
preservation of the gift.
However, if the will provide for the payment of all
expenses related to the transfer of the gift to the
beneficiary, such expenses shall be paid from the
residuary estate.
(f) If the gift of property is subject to a charge then who shall
pay for the charge?
In general, gift of property is subject to s64PAO which
provides that if there is any charge on the property the
property itself shall pay for the charge unless
specifically provided that the gift shall be free of
mortgage.
However, if the will provide that the gift of property shall
be "free of mortgage", then this provision is contrary to
s64 PAO and the charge of the property shall be paid
from the residuary estate.
x.
Administrative provision clause
When trustees/personal representative holding trust asset for a
long time before distribution, should extend their statutory
power.
(a) Powers of appropriation
Section 68 PAO provides that personal representatives
can appropriate assets in satisfaction of a beneficiary's
share in cash provided:
that a specific gift is not prejudiced, and
the beneficiary consents.
It is usual to remove the requirement to obtain the
beneficiary's consent.

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This does not mean that personal representatives act

contrary to the wishes of beneficiaries, but the
advantage is that consent might be obtained informally.
General rule - the value of the asset appropriated should
not exceed the value that the beneficiary is entitled to in
cash. Therefore should obtain valuation of assets at the
date of appropriation not the date of death.
"to exercise the power of appropriation conferred
by s68 of the Probate and Administration
Ordinance Cap. 10 without obtaining any of the
consents required by that section"
(b) Rules of apportionment
If a will contains a specific gift that provides income (e.g.
rental property) and the gift of income producing

property to one beneficiary, and the gift of the residue
to another, where income is paid in respect of a period
both before and after the death, income then must be
apportioned and calculated on a daily basis between the
two beneficiaries under the Apportionment Ordinance.
This would be necessary in certain cases including the
following:
the will contains a specific gift of an income
producing asset and after the testator's death,
income is paid in respect of a period before death
and a period after death. Income must be
apportioned between the specific beneficiary and
the residuary beneficiary;
the will provides for successive interests and income
must be apportioned on the death of the life tenant.
The calculation becomes so complex that would be an
administrative burden.
It is common for the will to provide that the terms of the
Ordinance can be ignored to avoid complex calculations
when
the
estate
is
administered.
(Howe
v
Dartmouth/Allhusen v Whittel)
"to treat as income all the income from my

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Residuary Estate whatever the period in respect

of which it accrues and to disregard in this
respect the legal rules of apportionment"
The effect of such exclusion is that all income paid to
the personal representatives after death is treated as
income of the estate for distribution purposes even
though some or all of it may be attributable to the
period before death.
(c) Powers of investment
Trustees and personal representatives have power to
invest funds under their control under s4 TO. The
allowed investment instruments are listed in Schedule 2
of TO.
Could only invest in "authorized investments"
However, s4TO only allows the personal representative
to make very conservative investments.
It is usual to extend the powers to give the personal
representative freedom to invest, but that does not
mean he could invest recklessly.
"to invest money and to vary and transpose
investments from time to time with the same full
and unrestricted freedom to choose investments
as if they were a sole absolute beneficial owner"
The testator might also want to include a specific power
to buy a home for beneficiaries to live in. This is
important when the beneficiaries have contingent
interests, as that the power to buy a home for the
beneficiaries is not strictly an investment because it is
not income producing.
"to apply money in the purchase or improvement
of land as a residence for all or any of the
beneficiaries for the time being of any trust
hereof on such terms as they may in their
absolute discretion from time to time impose"
(d) Power of maintenance
Trustees and personal representatives have power under

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s33 TO to provide income for the maintenance

education and benefit of beneficiaries with contingent
interests. They must however, consider whether other
funds are available for the purpose. The duty to consider
is often removed by the will.
"to exercise their power of maintenance free from
any obligation to apply a proportionate part only
of income where other income is applicable for
maintenance purposes"
Also under s33 TO, note that a beneficiary with a
contingent interest who is aged 18 or more is entitled to
income as of right. Could provide that the income from
each of the asset of the estate shall be attached with

the asset to distribute.
"The income from my estate shall vest with the
capital"
(e) Power of advancement
Trustees and personal representatives have power to
advance up to one half of a contingent beneficiary's
presumptive share under s34TO.
The one half limitation is often removed by the will.
"to exercise their power of advancement free
from the provisions restricting the advancement
of any person to o ne half of his or her
presumptive or vested share or interest so as to
authorise the application of the whole of such
presumptive share or interest by way of
advancement."
(f) Payment of debt arrangement
In general, payment of debt of the deceased are from
the assets of the estate (s61 PAO)
According to s63 PAO, payment of debt and funeral
expenses of the testator is under a priority under part 2
of schedule 1 PAO.
Under Part II of Schedule 1 of PAO, the normal priority of
debt to be met by estate, provide the estate is solvent,

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shall be the following:

(i) Undisposed property
(ii) Residue
(iii) Pecuniary legacies
(iv) Specific gift
Abatement occur when pecuniary legacy is used to
satisfy debts and then each beneficiary under pecuniary
legacy shall pro-rate the remaining amount.
However the priority under Part II of Schedule 1 of PAO
could be varied by will. Usually would provide specific
direction on the payment of debt to the personal
representative.
Prudent practice to ask testator for instruction on debt

payment arrangement. Residue is usually applied to pay
debts and expenses. If residuary gift is a class gift to
children, subject to payment of debt then appropriation.
"pay my debts funeral and testamentary and
administration expenses from the proceeds of the
sale and conversion"
For gift of property under mortgage/charge, s64 PAO
provides that such mortgage/charge shall be paid out of
the property subject to contrary intention in the will.
So if the clause provide a gift "free of mortgage", then
the estate is responsible for discharge of mortgage.
(g) Power to give life tenant capital absolutely or by way of loan
Sometimes the life tenant might want to sell the life
interest.
It is usual to include power to make capital available to
the life tenant so as to extinguish it and accelerate the
interest vested on the remainder.
Executor could value such life interest and pay a lump
sum as a loan or capital rather than to keep such life
interest.
"My Trustees may at their discretion [and at the
request of my Wife] at any time or times pay to
her for her use and benefit the whole or any part

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or parts of the capital of my Residuary Estate."

(h) Power to insure assets
Could provide payment of premium from profit or capital
expressed in will.
"to exercise the power to insure against loss from
any insurable risk any property for the time being
comprised in my Residuary Estate to any amount
and to pay all premiums for the insurance out of
the income or capital of my Residuary Estate at
their discretion"
xi.
Attestation clause
An appropriate attestation clause must be appropriate to

circumstances:
eg. If the testator cannot read, must read to him and he
must state that he understand to prove knowledge and
acceptance. State: "Testator being unable to read, this
will was read to him and he stated that he
understood it. It was then signed by the Testator in
our presence and in the presence of each other."
eg If testator unable to read English and the will is drafted in
English, must explain in a language that the testator
understand and must include clause to state "Testator
being unable to read English, this will was translated
to him in Cantonese and he stated that he
understood it. It was then signed by the Testator in
our presence and in the presence of each other."
e.g. If testator unable to sign due to temporary injury, must
include clause to state "Testator being able to read but
unable to sign his name [temporarily due to an injury
to his hand], this will was signed by the Testator with
his mark in our presence and attested by us in his
presence in the presence of each other."
e.g. If testator unable to read and write due to blindness,
must explain in a language that the testator understand and
must
include
clause
to
state
"Testator
being

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[blind/unable to read/write] this will was read to him

and he stated that he understood it. At the request
of the Testator it was then signed on his behalf by
[name of person signing for Testator] in the presence
of the testator and us and attested by us in the
presence of the Testator, [name of person signing for
Testator] and in the presence of each other."
If one beneficiary witnessed the will then unless
supernumerary the gift provided to him in the will shall be
invalid but the will still valid overall. (s10 WO)
If the will later have a codicil and it was executed by
different witnesses then the gift would be revived.
However, if a creditor of the testator or his spouse attested
the execution of the will, the creditor shall be a valid witness
(s11 WO).
Failure of gift
Gift usually fail when:
If beneficiary predeceased the testator;
The beneficiary being a spouse of the testator at the time of
the will subsequently divorced the testator (s15 WO);
Could provide for contrary intention in the will.
Induced by force, fear, fraud or undue influence;
Uncertainty of gift or beneficiary;
Public policy;
The beneficiary witnessed a will but not supernumerary (s10
WO);
Only the gift that concerns the attested beneficiary fail,
other parts of the will still valid.
Could be cured by executing a codicil with different
witnesses (s10 WO)
Lapse non-residuary gift if no substitute shall fall into residuary
Lapse residuary gift if no substitute shall fall into partial
intestacy
s23 WO saves a testamentary gift to the testator's children from
lapse when they predeceased the testator.

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In this case, gift passed to the intended beneficiary's

children. Children who entitled must be living at the
testator's death.
s23 WO might subject to contrary intention in will.
"Section 23 Wills Ordinance does not apply to this
will"
The word "only" could be used to provide contrary intention
that negates the effect of s23 WO so gift would not pass to
children.
Unsure whether s23 WO might also apply to lapse of
contingency gift if no substitute provided.
As the testator might not desire the effect of s23 WO,
therefore when taking instructions from client prudent to ask
client whether he/she has any grand children.
Trust for sale

Residue is often expressly left on trust for sale where there is:
Life interest
Beneficiary is a minor
Contingent gift on residue
Trust for sale also imposed on intestacy under s62 PAO
Key elements
Immediate obligation on trustee to sell
Usually an express power for trustees to postpone sale at
discretion
Consent of beneficiaries might be required
Usually a direction to pay debts and expenses out of
proceeds of sale

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LG4 - Intestacy
Intestacy circumstances
A situation whereby the will failed/invalid or the deceased did
not made a will.
S5 WO has not been completely complied with so will might fail.
Witness also have to have capacity or will invalid.
Will revoked by subsequent marriage
Partial intestacy as the will did not effectively dispose of the
residuary estate of the deceaseds property. (e.g. No
substitution clause when the intended beneficiary predeceased
the testator. Also the exclusion of s23 WO by contrary intention
even though s23 might not affect contingency.)
Intestacy is governed by the Intestates Estate Ordinance.
The priority to distribution under intestacy (s4 IEO)
The entitlement is based on relationship, and could be proved
by married certificate, birth certificate or death certificate.
In a nutshell, first find out what person the intestate left.
Rules are provided for in the IEO to ascertain who is entitled to
estate (s4 IEO):
A married person with no children everything goes to
spouse. (s4(2) IEO)
Married with children Spouse receive statutory legacy
($500,000) with interest on that sum at 8% from the date of
death of the deceased, personal chattels and half the
residuary estate; the other half held on statutory trust for
children (beneficial trust). If the estate is less than the
statutory legacy, that money goes to the spouse only. (s4(3)
IEO)
Married with no children but with parent - Spouse receive
statutory legacy ($1,000,000) with interest on that sum at
8% from the date of death of the deceased, personal
chattels and half the residuary estate; the other half held on
statutory trust for parent. (s4(4) IEO)
Married with no children no parent but with siblings of whole
blood - Spouse receive statutory legacy ($1,000,000) with

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interest on that sum at 8% from the date of death of the

deceased, personal chattels and half the residuary estate;
the other half held on statutory trust for the siblings. (s4(4)
IEO)
A widower with children everything goes to children. (s4(5)
IEO)
A single person with both surviving parents everything
goes to parents in equal shares. (s4(6) IEO)
A single person with one surviving parent and siblings
everything goes to the parent (s4(7) IEO)
A single person with no spouse no children no parent, these
relatives shall take according to priority (s4(8) IEO):
(i) Siblings of full blood

(ii) Siblings of half blood
(iii) Grandparents
(iv) Uncles and Aunts
A single orphan person goes to bona vacantia (s4(9) IEO)
Personal chattels are those items as defined in s2 IEO. Must only
consist of item that the deceased use, wide but outdated
definition. eg exclude money or security of money.
Characteristics of beneficiaries
1. Surviving spouse
Must be a spouse recognized by law and survived the
intestate.
A valid foreign marriage, even though recognized under
s3(d) IEO, must be a marriage recognized under Hong Kong
Law. Therefore, the foreign marriage must be in the type
that is recognized by law in Hong Kong.
Does not cover gay people, common law marriage or
cohabite. When falling into spouse under intestacy situation,
the beneficiary needs to check whether marriage is valid.
(s2 Married Persons Status Ordinance)
A judicially separated spouse is not entitled to benefit as
spouse under intestacy. Look out difference between divorce
nisi and divorce absolute.

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ii.
Issue
Definition of issue in s2 IEO includes:
Children living at the death of the intestate;
Children conceived but not born (en ventre sa mere);
Illegitimate children; and
Adopted children.
Whenever issue takes trust on intestacy it would be under
statutory trust.
The children will have vested interest in the residuary
estate.
If more than one child, in equal share contingent upon
attaining 18 or marrying under that age.
If one child die after 18 even before the intestate,
child of that deceased children can take in equal
shares under per stirpes contingent on them
attaining 18. (s5(1)(a) IEO)
S33 (Power of advancement, entitled at most 1/2 of the
interest in the presumptive share), s34 (Power of
maintenance) WO applies when there is contingent interest
no matter whether testate or intestate. However, since in
intestacy no will so s33/34 WO strictly apply.
Right of appropriation (s7IEO and s68 PAO)

Also under intestacy s7 & Sch 2 IEO spouse have right to
acquire the matrimonial home in which he was residing at the
time of the intestates death in full or partial satisfaction of his
interest in the intestates estate.
E.g. A and B held matrimonial home in TC, B died intestate, A
could ask for the half interest of B to transfer to her in
satisfaction of her share of interest in the estate. (Payment of
equity money) Only available to spouse.
Must make application within 12 months of the grant being first
taken out.
Once spouse elect, cannot revoke.
So prudent advice before elect is to value the property first then

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quantify the benefit before election.

Where the spouse contributed to the purchase price of the
property but the property is held under the intestates name,
must quantify the interest.
Right cannot be exercised:
When the property is leased
The residence forms part of a building and the residuary
estate or indluces an interest in the whole of the building
(e.g. 3 storey village house and matrimonial home on
ground floor, cannot just appropriate the ground floor unless
can prove to court that after appropriation does not diminish
the value of whole house or make it more difficult to
dispose); or
The property was at the time of the intestates death partly
used for purposes other than for domestic purposes (ie
rental property)
Note difference between s68 PAO and s7 IEO appropriation. S7
IEO have payment of equality money, have 12 month time limit.
Statutory trust for sale under s62 PAO/s6 IEO

1. Statutory trust for sale
S62 PAO provides that everything under the intestate's
estate would be held on trust for sale to pay debts then
distribute
Assume a person die intestate, all his estate would be held
under trust for sale.
All trustees under trust for sale must all agreed to sell or not
to sell.
When advising client for appointment of trustee, must
advice to make sure these people go along.
So a trust for sale can exist in:
A will where there is express trust for sale; or
Intestate situation (full or partial) imposed by the PAO.
Under s62 PAO is an administrative trust for sale, which
means that the trust for sale only exist until the assets are
distributed.

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ii.
Power to raise statutory legacy through sale (s6 IEO)

The personal representatives can raise the statutory legacy
on the security of the estate.
Such power is exercisable only to raise the statutory legacy
and the interest attached to it (from the date of death to
date of payment).
Hotchpot rule (s5(1)(c) & s8 IEO)

Abolished in UK, but HK still have it.
Basically a rule that the beneficiary must account for the gift
he/she received before distribution of the estate.
Hotchpot would only apply if there is contrary intention on the
1.
giving of the intervivos gift

If you can find evidence that the testator does not intend
that particular child would bring into account what he/she
has received during the testator's lifetime then there will be
contrary intention.
If the intestate showed a contrary intention of advancement
the beneficiary can prove it to alleviate hotchpot rule
Also hotchpot will not apply if testator only one child as
everything give to him/her.
For the surviving spouse hotchpot rule only applies in partial
intestacy situation. Everything that the surviving spouse
received under the will be brought into account against her
statutory legacy.
s5(1)(c) IEO Hotchpot rule (Applies only to issue)
Applies on total or partial intestacy.
When the deceased made an inter-vivos settlement of
money or asset to issue by way of advancement or gift
on marriage and died intestate, the issue who benefitted
from the advancement has to account for the advance
by a reduction of his share in the intestate's estate.
In partial intestacy anything that the issue receives as
intervivos settlement plus any benefit he/she received
under the will would be brought against his/her interest

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on the partial intestacy.

Applies when any child received intervivos gift before
intestates death, on final distribution shall count these
intervivos gift.
Unless there is prove that the intestates intention is to
gift the gift, then the hotchpot rule applies.
Advancement in live counts as intervivos gift.
Only applies if:
The property held on statutory trust is divisible into
shares; (Only one child no concern) and
The beneficiary concerned are the intestates children.
(Siblings not applied)
Gift will be revalued at the date of death.
ii.
s8 IEO Hotchpot rule under partial intestacy (Applies to

both spouse and issue)
Applies only for partial intestacy
Surviving spouse's interest in the statutory legacy and
interest in the legacy must be reduced by what he/she
received under the will, except for personal chattels
specifically gifted in will.
Issues must bring into account gifts received under the will.
Benefit will be valued as at the date of death.
Appointment of matrimonial home by spouse (s7 IEO)

1. Power of appointment
Different from s68 PAO appropriation, s7 IEO only applies to
intestacy AND to spouse
The surviving spouse of a person who dies intestate has a
right to require the personal representative to appropriate
the matrimonial home comprised in the residuary estate in
which the spouse was resident at the time of the intestate's
death in or towards satisfaction of his or her entitlement.
If the matrimonial home exceeds the value of her
interest in the intestate's estate (ie accumulates the
statutory legacy, personal chattels and half the interest

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of the intestate's residuary estate plus interest), then

may pay equality money, which is the difference in
amount of the spouse's interest in the intestate's estate
and the value of the matrimonial home, to acquire the
matrimonial home.
The personal representative shall employ a qualified
valuer to ascertain the value of the home for the
purpose of appropriation.
ii.
Procedure for election by spouse
The procedure for such appropriation is contained in
Schedule 2 IEO:
It is a right for spouse of the intestate to elect to
appropriate the matrimonial home to himself/herself
A personal right that only the spouse can elect
Election within 12 months after grant of representation.
If the spouse is without mental capacity, election
may be made by guardian or court.
Infant spouse could elect as if he/she were of age.
Effectively, the personal representative is precluded
from selling the matrimonial home for 12 months
without consent from the spouse.
Restriction
not
applicable
if
the
personal
representative is also the spouse.
Application by spouse in writing to the personal
representative.
The spouse may require the personal representative to
inform the value of the home before making election.
The spouse may revoke election at the consent of the
personal representative.
iii.
Limitation on election
However, 3 type of building could not be appropriated
unless with court leave:
matrimonial home which form parts of a commercial
building
matrimonial home which at the date of death used
partly for non domestic purpose

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the matrimonial home is a part of a building of a

residuary estate
Commorientes rules
In circumstances in which it is unclear whether one died first or
which one died first, different presumptions applies to different
situations.
Under s11 CPO have a presumption of survivorship whereby if
two persons died and cannot determine who die first, the one
who was elder is presumed to die first. However, under s4(11)
IEO, there is a presumption that the spouse does not survive the
intestate. In case if conflict, the IEO prevail.
Note the difference in presumption of death between CPO and
IEO.
Accordingly in intestacy or partial intestacy:
For a gift of landed property, s11 CPO presumed that the
elder co-owner died before the younger.
For other gifts, s14(11)IEO presumed that the spouse shall
pre-deceased the intestate.
Intestacy under foreign law

S8A IEO, interest under a foreign intestacy will diminish the
surviving spouses statutory legacy.
S8A(3) interest subject to hotchpot.
Ie if spouse got money under intestacy in foreign country of
foreign asset, have to account into calculating the spouses
statutory legacy.

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LG5 - Grant of representation

Probate is a court order authorising one or more persons to
administer the deceased's estate according to the directions in the
Will. The person is referred to as executor.
Document of reference for probate
Before applying for the grant must prepare documents.
Refer to PAO, IEO and NCPR (Non-Contentious Probate Rule)
PD 20.1 set out what document needed in lieu of the application
for probate - Have to stick to these practices when applying for
probate. Have to use certain forms as stipulated by the judiciary.
Other than these statutes, also need to know the Law Society
circulars:
09-154 related to the domicile ordinance
08-607 with reference to the abolishment of the estate duty
- have to prepare a checklist according to new rule
05-712 apply for direction from master
Abolishment of Estate Duties and its effect to probate
On 11/2/2006 Hong Kong have abolished the estate duty.
Death before this day is still subject to estate duty which
involved more procedures in application for probate than now must get estate clearance from the ird.
Death after 11/2/2006, certain procedures now have to go
though the Home Affairs Department. Might have to apply
clearance from the HAD in case if the testator has a safe deposit
box for them to administer the opening of the safe deposit box,
so must download the form from the HAD for application. This is
done by IRD before abolishment of estate duty.
Application for probate
Probate is a special mechanism of the court to ensure better
administration of the estate. Upon presentation of probate the
asset holder shall act according to the direction of the executor
as if he is the deceased himself.
In application must make sure the client status is certain.

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Notice the special terms required or the Probate Registry might

reject the form submitted.
Also notice the time that the client attain the certain status. eg
the marital status of the client - If the wife is a first wife then
must use the term: "lawful kit-fat widow and relict".
First of all, when applying probate there must be a will.
No will, apply for Letters of Administration.
By applying for probate shall vest the testator property to the
executor.
If the estate is be subject to estate duty then attached to the
probate is a schedule of assets of the deceased.
Letter of Administration
It is a court order authorising one or more persons (max 4) to
administer the Deceased's estate in accordance with the law.
The person is referred to as administrator.
The purpose of letter of administration when there is no will.
If there is a will, but simply that no executor was appointed
or the executor appointed did not or could not apply for
probate for any reasons, the grant would be a Letter of
Administration with Will Annexed. (s35 PAO)
The Letter of Administration would also be attached with a
schedule of assets and liability.
When taking instruction from client must seek these information:
Death certificate of the deceased.
If the deceased died outside of Hong Kong, because the
succession takes effect at death so must prove death.
Even if there is a letter issued by that foreign country to
prove death, we do not know whether the signature is true
or with authority, so need to get authentication from the
foreign authority. eg a notarial certificate and supported by
a letter issued by an authoritative government branch.
If the foreign country is a party to the Hague Convention
then the country would appoint an official to issue an
Apostille and that is acceptable.

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If the foreign country is not a party to the Hague Convention

(e.g. Canada), then could ask for the Foreign Affairs
Department of the Chinese Consulate Office at that country
to authenticate the signature of the official.
Date of death also important, as the will speaks from the date of
death.
Usually on death certificate would indicate the date of
death.
However, in some case it is not certain. In that case then
must state "within a certain amount of days at the date" and
state so in all probate document.
Ask for whether there is a will to determine whether the
deceased died testate or intestate.

Solicitors should only accept instructions from the executor,
or if no executor only the persons who are beneficiary to the
deceased estate could apply for grant.
If no will found should advice the client to conduct a will
search by the Law Society.
In case if the will is stored in a safe deposit box then must
arrange for opening of the safe deposit box. In that case if
the deceased die before 11/2/06 then must seek permission
from the IRD to open the safe deposit box with a joint
inspection.
Ascertain the assets and liabilities of the deceased.
Have to collect sufficient information to list all the assets left
by the deceased.
May have to write letters to the appropriate authorities to
ascertain asset and liability. eg a bank even though
passbook is present as the bank after receiving a letter of
request would cause an exhaustive search on its records for
all account opened by the deceased and provide the
balance with interest calculated at the date of death.
If deceased die before 11/02/2006:
As for property, if the deceased hold property in joint
tenant then the property would be automatically
transfer under right of survivorship so this property does

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not form part of the deceased estate.

However, for estate duty purpose if the deceased die
before 11/2/2006 still have to include half the value of
the property. The intent behind such measure is due to
the anti avoidance rule. Also have to include gift within
3 years made by the deceased into estate for
calculation of estate duty.
Form ED1 only used for estate chargeable for estate
duty. Have to list out all the assets for the assessment of
estate duty in the form.
Form ED30 is for will property for the purpose of
valuation by the Rating and Valuation Department, as
the Government might not accept the valuation of the

property submitted in the ED1 form.
Even if estate duty is chargeable could also apply for
exemption from estate duty for a certain type of
property eg matrimonial home.
Estate duty is being levied on a progressive scale
according to the net asset value of the estate. From 0%
under 7.5million to max 18%.
If IRD accept figure and the estate is under the
exemption figure (7.5m) then the EDO would issue
Certificate of Exemption.
There are three types of Certificate of Exemption - in
respect of the value of estate or in respect of joint
property or in respect of trust property.
If estate chargeable to estate duty then have to pay
estate duty then get receipt and clearance from IRD to
proceed.
In any case, if the decease died before 11/02/2006 need
to get the Certificate and the schedule of assets made
by the IRD for application of probate.
If deceased die before 11/02/2006:
After abolishment of estate duty, does not need to go
through steps with the IRD.
Still have to make a schedule of assets and liability to be

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annexed to the application for grant.

In this case only cash in banks needs to give value at
the date of death but not for other property.
How to apply for grant?

Must choose the right person depending upon whether the
deceased die testate or not.
There are two types of grant depending upon whether it's
contentious (dispute) or not.
If contentious cannot apply the rules in the NCPR.
1.
Where the deceased left a valid will

NCPR 19 provides for a chain of administration in the
following priority for persons taking out a grant.
An applicant for grant must be according to a list of persons
in priority as follows:
(i) the executor;
(ii) any residual legatee or devisee holding in trust for any
other person;
(iii) any residual legatee or devisee for life ;
(iv) the ultimate residual legatee or devisee; or
where the residual estate is not wholly disposed of
by the will, any person entitled to a share in the
residue; or
the personal representatives of any such person
subject to NCPR 25(3) (live interests preferred to
dead ones);
(v) any specific legatee or devisee; or
any creditor; or
the personal representatives of any such person
subject to NCPR 25(3); or
where the estate is not wholly disposed of by the
will, any person who does not have an immediate
beneficial interest in the estate but who might have
such an interest in the event of an accretion to the
estate;

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(vi) any legatee or devisee, whether residuary or specific,

entitled on the happening of any contingency, or any
person having no interest under the will but who would
have been entitled to a grant if the deceased had died
wholly intestate.
The beneficiary witness who lost their right to gift under
s10WO also lost their right to take out a grant. (NCPR20)
If no probate due to the will did not appoint an executor,
then the Court would only grant Letter of Administration
with Will annexed, and appoint an administrator.
If all executors appointed in the will died or renounced
their right to act, then under s35 PAO court would also
grant Letter of Administration with Will Annexed, and

appoint an administrator.
Court would also point out that the reasons why the probate
could not be obtained in the Letter of Administration.
If no executor, and there exist minority interest which
requires 2 administrators under s25 PAO, but less than 2
administrators is willing to act after exhausting the list
under NCPR 19:
If there is one competent administrator, he may
nominate any other person as a fit and proper person to
take the grant, unless the Registrar direct otherwise.
(NCPR 35)
If there is no competent administrator, the minor's
guardian or any person interested may apply to the
court for the appointment of the Official Administrator to
administer the estate. (s16(2) PAO)
ii.
Where the deceased left no valid will

If the deceased die intestate then instead of probate the
court would only issue Letter of Administration.
NCPR 21 provides for a chain of administration in the
following priority for persons taking out a grant for an
intestate's estate which is similar to that of s4 IEO, as
follows:

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(i) the surviving spouse or the surviving partner or partners

to a union of concubinage entered into before 7 October
1971;
(ii) the children of the deceased, including any child born of
a union of concubinage entered into before 7 October
1971 or the issue of any such child who has died during
the lifetime of the deceased;
(iii) the father or mother of the deceased;
(iv) brothers and sisters of the deceased or the issue of any
deceased brother or sister of the deceased who has died
during the lifetime of the deceased;
(v) grandparents;
(vi) uncles and aunts of the deceased or the issue of any

deceased uncle or aunt of the deceased who has died
during the lifetime of the deceased;
(vii)A creditor of the deceased or to any person who,
notwithstanding that he has no immediate beneficial
interest in the estate, may have a beneficial interest in
the event of an accretion thereto, or is, by virtue of
section 3 of the Inheritance (Provision for Family and
Dependants) Ordinance (Cap 481), entitled to apply to
the court for an order under section 4 of that Ordinance
(NCPR 21(4)); and
(viii)
Finally the Official Administrator. (NCPR 21(3))
The precondition for application is the applicant must be one
who gets benefit from the estate.
Therefore if the estate had extinguished by vesting
benefit to one beneficiary before it could satisfy the
others, only that one beneficiary could apply.
So first category is the surviving spouse who could apply
for probate and entitle to grant. What if the intestate
estate have only $100,000 and one surviving spouse
with issue? In that case only the surviving spouse could
apply as by her statutory legacy already wiped out the
whole estate. Her sons got nothing, so they could not
apply. Even if the spouse renounce her right to apply the

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sons still could not apply for her as they have no

entitlement to the estate.
NCPR 21(4) applies for a creditor of the estate or that a
beneficiary who MIGHT have entitled to benefit could
also apply for grant, as there might be hidden assets so
the issue might also be applicable as the contingency of
hidden asset.
iii.
Surety
What if the executor abscond with the estate's assets?
In this case the court could ask the executor for a surety before
grant as condition to protect the beneficiary. (s46 PAO)
Grant to an attorney could be allowed provide surety.
Grant to a solicitor usually don't need surety as the solicitor

have professional negligence liability insurance.
Application by affidavit/affirmation
Form L1.2a - Affirmation by the wife of the deceased (who
died on or after 11/02/2006) as administratrix (p148 DB)
Form L1.2b - Affirmation by the wife of the deceased (who
died before 11/02/2006) as administratrix (p152 DB). Must
include particular of assets prepared by the IRD (p154 DB)
Form N2.1 - Affirmation verifying the schedule of Assets and
Liabilities for grant (p166 DB)
iv.
Preference under NCPR 25(3)
If there is more than the required person entitled to take out
grant in the same class of persons, certain preference in
NCPR 25(3) applies to select the personal representative
from the class:
Persons over 21 over persons under 21;
Persons with no disability over persons with physical or
mental incapability;
Person of live interest over person of dead interest
Probate Registry has power to resolve disputes amongst
those entitled in the same degree (NCPR25(2))
Capacity and number of personal representative
1. Capacity
Persons over 21

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Sound mental and physical capacity

Persons not under a disability is preferred against other of
his peers. (NCPR 25(3))
ii.
Number
The maximum number of people that can take out a grant is
4 for either case. (s25(1) PAO)
If more than one appointed but only one applied, while
notice does not need to serve to the others, must reserve
their right to act. (NCPR 25(1))
The minimum number of person to take out grant:
For probate, one executor suffice, even there is minority
interests or life interests.
For Letters of Administration, there must be two
administrators if there exists minority interests (under

18) or life interests. (s25(1) PAO)
If there is only one administrator where 2 is
required, any person or the guardian of such person
interested may apply to the court to appoint more
administrators according to NCPR or order. (s25(2)
PAO)
The court also have power to appoint any person to
be administrator either in addition or in substitution
to the existing administrators. (s36 PAO)
Problematic situation in taking out grant
1. Grant to an attorney of the person entitled
This is possible where the person entitled resides outside
Hong Kong or for some reasons cannot take out a grant (eg
disability).
The grant is limited 'for the use and benefit of the donor
of the power'.
If the person entitled is an executor, notice must be given to
the other executors but the Registrar has power to dispense
with notice.
Where the donor of the power of attorney is an
executor, the grant will be letters of administration with

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will annexed. This is because of the rule that a grant of

probate is made only to executors appointed by the will.
ii.
Grant to a corporation
If the corporation has not been appointed executor and is
not the attorney of the person entitled, all the persons
entitled to a grant and all the residuary beneficiaries must
consent to the appointment.
The consent of the beneficiaries is required because the
appointment affects the expenses of the estate.
Trust corporations - e.g. Hong Kong Bank Trustee Limited :
(s78 TO) can act in their own name. An officer of the
corporation makes the oath. (NCPR 34)
Other corporations - the grant is made to a nominee (or its
attorney if the corporation has its principal place of business
outside Hong Kong) (NCPR 34(2))
iii.
Deceased domiciled outside H K

Grant may be made to person entitled in country where the
deceased died domicile. (NCPR 29)
The practice is for the grant to be obtained first in the place
where the deceased died domiciled.
iv.
Persons under 21 entitled
When an underage person is one of several executors
appointed by the will, then in practice the grant is made to
the executors who are not under a disability with power
reserved for the underage person to apply for a grant when
he attains 21.
When the underage person is the last potential executor or
administrator, a grant of letters of administration will be
made 'for the use and benefit of' the underage person until
he attains 21 to:
(i) to his parents jointly, or
(ii) any guardian appointed by the court or
(iii) if there is no such guardian able and willing to act, and
the person is 16 or over, then to any next of kin (blood
relation) nominated by that person or if the person is a

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married woman, to any such next of kin or to her

husband if nominated by her. (NCPR 31(1))
(iv) a person can apply to the court to be assigned as
guardian to take out a grant for the use and benefit of
the underage person. The assigned guardian can take
out a grant in default of or jointly with or to the
exclusion of anyone in the above categories.
(v) if there is only one person to take out a grant under the
above provisions and two administrators are needed
under s25 PAO, then a person taking out a grant under
the above provisions can nominate a second
administrator.
However if a person under 21 is appointed sole
executor, but has no interest in the residuary estate,
letters of administration for the use and benefit of
the person appointed executor, until that person
attains 21 shall, unless the Registrar otherwise
directs, be granted to the person entitled to the
residuary estate. (NCPR 31 (5))
v.
Person with physical or mental incapacity entitled
NCPR 33 and NCPR 25(3) (persons not under a disability
preferred)
vi.
Official administrator
May administer an intestate's estate or in the case of a will
exist but no executor, provide a grant is taken out, under
these circumstances (s16PAO):
(a) no next of kin of the deceased are resident in Hong
Kong;
(b) the next of kin of the deceased who is resident in Hong
Kong files in the Registry a request for or consent to the
making of such grant, in writing signed by him;
(c) no person has, within twelve months after the death of
the deceased, obtained administration of his estate; and
(d) the next of kin of the deceased is resident in Hong Kong
and is an infant.
May administer any estate (summary administration) which

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does not exceed H K$ 150,000 which is made up wholly of

money (without taking out a grant and without obtaining
estate duty clearance whatever the date of death) (s15 PAO)
Changes to grant
In some cases, after the probate issued but might found out
other assets which is not included in the schedule of assets so
have to make an corrective application to amend the grant.
Use the following forms:
Form N2.1 - Affirmation verifying the schedule of Assets and
Liabilities for grant (p166 DB)
Form N2.2 - Corrective Affidavit made before Grant (p168
DB)
Form N2.3 - Corrective Affidavit made after Grant (p170 DB)
Form N4.1 - Schedule of Assets and Liabilities of the
Deceased in Hong Kong at date of death (p172 DB). Must be

verified by the executor/administrator's affidavit/affirmation.
Form N4.2 - Additional Schedule of Assets and Liabilities
(p176 DB). Must be verified by the executor/administrator's
affidavit/affirmation.
Death or renunciation of executor

1. Renunciation of the right to a grant of representation before
grant
No one can be forced to accept office as a personal
representative.
Even if appointed as executor can renounce his right
provided he has not accept office. (s29 PAO).
Renunciation of the right to a grant of probate does not
operate as a renunciation of the right to a grant of
letters of administration unless that right is also
expressly renounced (NCPR 35(1))
Therefore if a person appointed executor renounced,
they should also renounced their entitlement (if any) as
administrator.
Once executor renounce, may follow the next priority under
NCPR19/21 to look for another one who is willing to act as

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In that case, the grant would be a Grant of Letters of
Administration with Will Annexed.
ii.
If before the death of the executor he has not totally
dispose of his duty
(a) Chain of executorship (s34 PAO)
When one executor died after proving will but before
fully administered the estate if the testator, and if that
executor has a will with a validly appointed executor,
that executor appointed shall act as BOTH the executor
of the deceased executor AND the executor of the
deceased executor.
So long as the chain of such representation is unbroken,
the last executor in the chain shall be the executor of
every preceding testator. (s34(3) PAO)
The chain of executorship only applies to executor, not
administrator.
Any intestate situation would break the chain. (s34(4)
PAO)
(b) Grant in respect of unadministered property (grant de bonis
non administratis)
If the property is vested to a personal representative
and he/she is also the sole beneficiary entitled to that
property, he/she should vest the property from his
capacity as personal representative to himself through a
vesting assent.
An assent is the formal act whereby the personal
representative indicates that an asset is not needed
for the purposes of paying debts or liabilities and
can be released to the beneficiary. It is also the
formal act of transfer to the beneficiary. Thus an
assent can be formal or informal and can refer to
either i) the release of the asset to the beneficiary or
ii) the name of the document of transfer.
An assent is necessary if the personal representative
is beneficially entitled to the asset. (Re King's Will

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Trusts [1964] Ch 542)

s66 PAO provides that personal representatives have
power to assent to the passing of property to a
person beneficially entitled or to a person entitled to
it as trustee or as personal representative.
Since a vesting assent of a property is in writing and
affects interest in land, should register the assent to
the Land Registry. (s3(2) LRO)
However, if the property is not vested to the beneficiary
who is also the personal representative and he/she died
without vesting the property from his capacity as
personal representative to himself, and if she did not
leave a will the property would become an
unadministered property, and the title of the flat could
not be transferred to a third party. (Chao Mei Hua v
Ferrier Investment Ltd [1995] 1 HKC 673) In that case,
have to take out a grant of unadministered property
(grant de bonis non)
The persons who take out the grant de bonis non in
this case would be the person after the next priority
of the personal representative under NCPR 21.
Such grant would only be limited to the
unadministered property only.
Such letter of administration is called "Letters of
Administration with Will Annexed De Bones Non
Documents that needed to be filed for an application of grant

1. Commonly used specified forms:
(a) HAD forms
HAEU1 - Application for Release of Money for Funeral
Expenses from a Deceased Person's Bank Accounts
HAEU2 - Application for Release of Money for
Maintenance from a Deceased Person's Bank Accounts
HAEU3 - Application for Inspection of a Deceased
Person's Bank Deposit Box
HAEU4A - Application for Removal of Items by Surviving

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Renter from a Jointly Rented Bank Deposit Box with

Survivorship Arrangement
HAEU4A-A - Affidavit of the Surviving Renter in Support
of an Application for the Issue of an Authorization for
Removal from Bank Deposit Box with Survivorship
Arrangement
HAEU4B - Application for Removal of Documents from a
Deceased Person's Bank Deposit Box (Rented in Sole
Name or Jointly with Other Persons)
HAEU5 - Application for a Confirmation Notice in respect
of an Estate Wholly Made Up of Money and Not
Exceeding $50,000 in Value
HAEU5-A - Affidavit by Executor/Intending Administrator
for the Issue of a Confirmation Notice
HAEU5-S - Schedule of Money of the deceased person in
Hong Kong as at the date of death
HAEU6A - Application for a Copy/Certified True Copy of
the Copy of the Will or Similar Instrument of a Deceased
Person
HAEU6B - Application for a Copy/Certified True Copy of
the Copy of the Inventory of Contents in a Deceased
Person's Bank Deposit Box (Rented in Sole Name or
Jointly with Other Persons)
2. Probate Registry forms
Application with Will
Form W1.1a - Affirmation or Affidavit by Executor
(Executor's Application) death after 11-2-2006
Form W1.1b - Affirmation or Affidavit by Executor
(Executor's Application) death before 11-2-2006
Form W1.3a - Affirmation or Affidavit by
Administrator with Will, Sole Executor has Died or
Renounced, death after 11-2-2006
Form W1.3b - Affirmation or Affidavit by
Administrator with Will, Sole Executor has Died or
Renounced, death before 11-2-2006
Form W1.4a - Affirmation or Affidavit by

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No
Form W3.2 - Affirmation or Affidavit of Handwriting

and Signature
Form W3.3 - Affirmation or Affidavit of Plight and
Condition of Will
Form W3.4 - Affirmation or Affidavit as to Alterations
in Will
Form S3.2a - Affirmation or Affidavit by
Administrator with Will, Grant De Bonis Non, death
after 11-2-2006
Form S3.2b - Affirmation or Affidavit by
Administrator with Will, Grant De Bonis Non, death
before 11-2-2006
Form N4.1 - Schedule of Assets and Liabilities
Form N2.1 - Affirmation or Affidavit verifying the
Schedule of Assets and Liabilities (For Grant)
Application with no will
Form
L1.1a
Affirmation
or
Affidavit
by
Administrator, Husband's Application, death after
11-2-2006
Form
L1.1b
Affirmation or Affidavit
by
Administrator, Husband's Application, death before
11-2-2006
Form
L1.2a
Affirmation
or
Affidavit
by
Administratrix, Wife's Application, death after 11-2
Administrator with Will.

executor appointed, death after 11-2-2006
Form W1.4b - Affirmation or Affidavit by
Administrator with Will, No executor Appointed,
death before 11-2-2006
Form W2.1 - Renunciation of Probate
Form W2.2 - Renunciation of Administration with Will
Form W3.1 - Affirmation or Affidavit of Due
Execution of the Will

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2006
Form
L1.2b
by
Administratrix, Wife's Application, death before 112-2006
Form
L1.3a
Affirmation
or
Affidavit
by
Administrator, Child's Application, death after 11-22006
Form
L1.3b
by
Administrator, Child's Application, death before 112-2006
Form
L1.4a
Affirmation
or
Affidavit
by
Administrator, Parent's Application, death after 11-22006
Form
L1.4b
by
Administrator, Parent's Application, death before 112-2006
Form
L1.5a
Affirmation
or
Affidavit
by
Administrator, Sibling's Application, death after 112-2006
Form
L1.5b
by
Administrator, Sibling 's Application, death before
11-2-2006
Form
L1.6a
Affirmation
or
Affidavit
by
Administrator, Other's Application, death after 11-22006
Form
L1.6b
by
Administrator, Other's Application, death before 112-2006
Form L2.1 - Renunciation of Administration
Form L3.1 - Power of Attorney to take Administration
Form L3.2 - Nomination of a Co-administrator
Form L3.3 - Election of Guardian for the purpose of
Nominating a Co-Administrator
Form L3.4 - Election of Guardian to take Grant
Form S3.1a - Affirmation or Affidavit by
Administrator, Grant De Bonis Non, death after 11-2-

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ii.
2006
Form S3.1b - Affirmation or Affidavit by
Administrator, Grant De Bonis Non, death before 112-2006
Summary administration (Estate only cash <=150000)
Schedule of Assets and Liabilities (Summary
Administration)
Documents to include for application of grant
After
completing
the
Specified
Forms
of
affidavits/affirmations, the applicant must make sure that
the application is filed together with the following
documents:
(a) Original or Certified Copy of Death Certificate;
(b) Original or Certified Copy of Marriage Certificate, if
the applicant is the spouse of the deceased;
(c) Original or Certified Copy of Birth Certificate, if the
applicant is the child of the deceased;
(d) Original Will of the deceased together with a copy
thereof, if any;
(e) Copy of Hong Kong Identity Card, if applicable;
(f) Certificate of Exemption or Payment of Estate Duty if
the death occurred before 11 February 2006;
(g) A schedule of assets (Form N4.1 - Schedule of Assets
and Liabilities);
(h) Any other original documents proving the
applicant's entitlement to the grant; and
(i) A cheque for the filing fees.
For documents issued outside Hong Kong, certain formality
needs to be observed.
Small estate administration (Net assets = cash < $50,000) (s60K

PAO)

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A small estate is an estate:

(a) where all properties beneficially owned by the deceased are
money that does not exceed HK$50,000 in total and
(b) the deceased did not hold any property as trustee for
another person at his death.
In such cases, the personal representatives may file with the
Secretary for Home Affairs an affidavit with a schedule of assets
in duplicate declaring that all properties beneficially owned by
the deceased does not exceed HK$50,000 in aggregate at his
death and at his death he did not hold any property as a trustee
for any person. (s60K(2) PAO)
If the documents are in order, a confirmation notice with the
schedule of assets attached will be issued by the Secretary for
Home Affairs.
The effect of the confirmation notice exempted the applicant
and any third parties dealing with the estate of the
deceased set out in the schedule of asset from liability of
intermeddling under s60J PAO.
The confirmation notice may be cancelled and a fresh notice
issued if the personal representatives provide written
notification that they become aware:
(a) of property beneficially owned by the deceased which has
not been disclosed in the affidavit;
(b) that the deceased held property as trustee for another
person at the date of his death;
(c) of any in accuracy in the schedule attached to the
confirmation notice.
Summary administration (Net assets = cash < $50,000) (s15 PAO)

For any estate that made up of money not more than
$150,000.00 and the deceased did not hold any property as
trustee for Tso or Tong, the Official Administrator may, under
application by a person entitled to a share in the estate, get in
and administer the same in a summary manner without a grant
or other legal formality. (s15(1) PAO)
Application in the form of an affidavit (Form N1.1) with the

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following documents:
Death certificate of the deceased;
All documents related to the estate (e.g. bank passbook);
A certificate of identity that shows the relationship between
the deceased and the applicant; and
A verifying affidavit with the Schedule of Assets and
Liabilities.
Safe deposit box of the deceased (After 11 February 2006)
1. Inspection(s60D PAO)
The purposes for opening of the safe deposit box of the
deceased (s60D(2) PAO):
Ascertain whether the will is in the box; and
Prepare an inventory of items inside the box.
Procedure
Apply for certificate for necessity of inspection of bank
deposit box (to the Secretary of Home Affairs) s60C(1)
PAO
Form HAEU3 - Application for inspection of a
deceased personal bank deposit box
(ii) Make appointment for inspection with public officers
authorized by Secretary of Home Affairs
(iii) Inspection to take place in presence of:
(1) holder of certificate;
(2) bank staff and
(3) authorised public officer
(iv) Make an inventory of the contents in the box. The
original inventory is kept by the holder of the certificate
with a copy of each given to the bank and the Secretary
for Home Affairs. The bank and the public officers should
keep the copy of the inventory for 6 years. See s60D(9)
PAO.
Three situations:
If no will found, the holder of the certificate shall prepare
a list of inventory of the items in the box and seal it.
(s60D(3) PAO)
(i)

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ii.
If the will is found in the box naming the holder of the

certificate as the executor, the holder can removed the
will after placing a copy of the will in the box. (s60D(6)
PAO)
If the will is found and the holder of the certificate is not
the named executor or no executor is named in the will
or the holder of the certificate is not the surviving renter
(ie, not jointly holding the safe deposit box with the
deceased) , the bank staff should make a copy of the
will and hand the copy to the public officer, put back the
original will into the box and sealed it. (s60D(4) PAO)
Removal of items (s60E PAO)
The procedure for removal of items from the safe deposit

box varies according to whether the personal representative
is also the surviving renter of the safe deposit box (where
the safe deposit box is rented jointly with the deceased).
(i) Where personal representative is also the surviving
renter, the personal representative must:
Prepare inventory of the contents in the box
Apply for an authorization for removal (authorization
for removal may be restricted to items or documents
belonging to surviving renter and documents
required for application of grant)
Form HAEU4A - Application for Removal of Items
by Surviving Renter from a Jointly Rented Bank
Deposit Box with Survivorship Arrangement
File an affidavit declaring items to be removed
belong to the personal representative
Form HAEU4A-A - Affidavit of the Surviving
Renter in Support of an Application for the Issue
of an Authorization for Removal from Bank
Deposit Box with Survivorship Arrangement
(ii) Where surviving renter is not personal representative
and wishes to remove items within 12 months of
deceased death, surviving renter must
Obtain written consent from personal representative

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and
Obtain authorization for removal of items
Items are normally removed in the presence of the personal
representative.
Upon expiry of 12 months, surviving renter can have access
to the safe deposit box without authorization provided:
(i) the bank is satisfied that deceased has died more than
12 months and
(ii) an inventory to the contents of the box had been
prepared.
Note that the bank and its staff are exempted from criminal
liability for intermeddling so long as they have acted in good
faith and have exercised care in accordance with the
certificate for inspection and authorization for removal. See
s60J (4) and (5) PAO and flowchart provided by the Home
Affairs Bureau.
Relevant statutes
Rule 19 Non-Contentious Probate Rules - Order of priority for grant
where deceased left a will
The person or persons entitled to a grant of probate or administration with the will
annexed shall be determined in accordance with the following order of priority,
namely(i)
the executor;
(ii)
any residuary legatee or devisee holding in trust for any other person;
(iii) any residuary legatee or devisee for life;

(iv) the ultimate residuary legatee or devisee or, where the residue is not wholly
disposed of by the will, any person entitled to share in the residue not so
disposed of (including the Official Administrator) or, subject to rule 25(3), the
personal representative of any such person:
Provided that where the residue is not in terms wholly disposed of, the Registrar
may, if he is satisfied that the testator has nevertheless disposed of the whole or

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substantially the whole of the estate as ascertained at the time of the application
for the grant, allow a grant to be made (subject however to rule 37) to any
legatee or devisee entitled to, or to a share in, the estate so disposed of, without
regard to the persons entitled to share in any residue not disposed of by the will;
(v)
any specific legatee or devisee or any creditor or, subject to rule 25(3), the
personal representative of any such person or, where the estate is not wholly
disposed of by the will, any person who, notwithstanding that the amount of
the estate is such that he has no immediate beneficial interest therein, may
have a beneficial interest in the event of an accretion thereto;
(vi) any legatee or devisee, whether residuary or specific, entitled on the

happening of any contingency, or any person having no interest under the
will of the deceased who would have been entitled to a grant if the deceased
had died wholly intestate.
Rule 21 Non-Contentious Probate Rules - Order of priority for grant

in case of intestacy
(1) Where a person dies wholly intestate, the persons having a beneficial
interest in the estate shall be entitled to a grant to administration in the
following order of priority, namely(i)
the surviving spouse or the surviving partner or partners to a union of

concubinage entered into before 7 October 1971;
(ii)
the children of the deceased including any children born of a union of

concubinage entered into before 7 October 1971, or the issue of any
such child who has died during the lifetime of the deceased;
(iii) the father or mother of the deceased;

(iv) brothers and sisters of the deceased or the issue of any deceased
brother or sister of the deceased who has died during the lifetime of the
deceased.
(2) If no person in any of the classes mentioned in sub- paragraphs (ii) and (iii) of
the last foregoing paragraph has survived the deceased, then, the following
persons hereinafter described shall, if they have a beneficial interest in the
estate, be entitled to a grant in the following order of priority, namely(i)
grandparents;

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(ii)
uncles and aunts of the deceased, or the issue of any deceased uncle or
aunt of the deceased who has died during the lifetime of the deceased.
All of the persons referred to in classes (i) and (ii) of this paragraph shall be
entitled to a grant notwithstanding that the relationship referred to shall
have been established by or resulted from a union of concubinage.
(3) In default of any person having a beneficial interest in the estate, the Official
Administrator.
(4) If all persons entitled to a grant under the foregoing provisions of this rule
have been cleared off, a grant may be made to a creditor of the deceased or
to any person who, notwithstanding that he has no immediate beneficial
interest in the estate, may have a beneficial interest in the event of an
accretion thereto, or is, by virtue of section 3 of the Inheritance (Provision for
Family and Dependants) Ordinance (Cap 481), entitled to apply to the court
for an order under section 4 of that Ordinance.
(5) Subject to rule 25(3), the personal representative of a person in any of the
classes mentioned in paragraphs (1) and (2) of this rule or the personal
representative of a creditor shall have the same right to a grant as the
person whom he represents:
Provided that the persons mentioned in paragraph (1) and in paragraph (2)
of this rule shall be preferred to the personal representative of a spouse who
had died without taking a beneficial interest in the whole estate of the
deceased as ascertained at the time of the application for the grant.
(6) The provisions of the Adoption Ordinance (Cap 290) shall apply in
determining the entitlement to a grant as they apply to the devolution of
property on intestacy.
Part II to Schedule 1 of Probate Administration Ordinance - Order of

application of assets where the estate is solvent
1.
Property of the deceased undisposed of by will, subject to the retention

thereout of a fund sufficient to meet any pecuniary legacies.
2.
Property of the deceased not specifically devised or bequeathed but included

(either by a specific or general description) in a residuary gift, subject to the
retention out of such property of a fund sufficient to meet any pecuniary
legacies, so far as not provided for as aforesaid.

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3.
Property of the deceased specifically appropriated or devised or bequeathed

(either by a specific or general description) for the payment of debts.
4.
Property of the deceased charged with, or devised or bequeathed (either by

a specific or general description) subject to a charge for the payment of
debts.
5.
The fund, if any, retained to meet pecuniary legacies.
6.
Property specifically devised or bequeathed, rateably according to value.
7.
Property appointed by will under a general power, rateably according to

value.
8.
The following provisions shall also apply(a)
the order of application may be varied by the will of the deceased;
(b) this Part of this Schedule does not affect the liability of immovable
property to answer the estate duty (if any) imposed thereon in
exoneration of other assets.

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LG6 - Administration of estate

Where it comes to a state that the testator already died whereby the
personal representative need to administer the estate.
Stages of procedures:
(1) Collect asset
(2) Pay debt
(3) Distribute estate
Property shall vest in the executor immediately upon death,

while under a Letter of Administration property shall vest until
LA is issued.
The Grant of Probate is evidence of title whereas if under
intestacy situation then the Letter of Administration is the
evidence.
Assets
Assets that are not distributable:
Life interest
Share in joint tenancy
Insurance policy. (Normally have nomination clause)
Realty
When the testator/deceased have reality as property need
to check
whether it is co-owed?
If it is co-owned whether it is in joint tenancy or tenants
in common?
If under joint tenancy:
Any severance or any memo of severance?
Any partition of property?
Any subsequent sale of the interest inter vivos?
If the property is matrimonial home must remember there is
a right of appropriation under s7 IEO personal to surviving
spouse. ie only he/she could elect.
If spouse contributed to the purchase price of the property

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there might be a resulting trust situation.

s64 PAO provides that any relating charges to the property
must be paid out of the property unless drafting provide for
the property not liable for mortgage so estate pay for the
mortgage.
Personal chattels
The definition in s2 IEO is old definition so client might have
different definition.
Personal chattels are to give to spouse under IEO.
Company shares
Shares certificates and grant of representation must
submitted to share registry for registration.
Make sure no right of preemption in the Memorandum and
Articles of Association of the company.
Partnership business
If the deceased hold partnership share might need a copy of
the partnership agreement to ascertain the respective rights
and obligation of a partner.
General rule that partnership dissolve upon death of a
partner.
But partnership agreement might provide that upon death of
a partner a sale of the share to other partners.
Business
Check whether the business still exist.
The personal representative can continue to run the
business but should get indemnity from the beneficiaries.
If there is causes of action related to the business then the
personal representative can sue or be sued as in the shoe of
the deceased.
Power to manage business
the personal representatives can make an application to the
court for authority to carry on a business under s50 TO
Power to postpone distribution
Under s71 TO normally the personal representative is not
bound to distribute estate one year after death
During that course of administration the beneficiaries have

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no right to the interest of the estate only have a right to rely

on the personal representative for fair administration of the
estate.
Realization of assets
There is an inherit power to sell by the personal
representative under the common law.
The will could also provide express power to sell to the
s54PAO provides that conveyance of immovable property
could only be done with the consent of all the personal
representative or by order of court.
The personal representative sell assets for:
payment of debt.
Property charged shall pay out from the property
itself subject to contrary intention in the will (s64
PAO)
s62PAO provides for trust for sale of all assets to satisfy
debts of the deceased subject to contrary intention in
the will.
under IEO trust for sale is implied under s62 PAO.
Payment of debt in priority under Part II of Schedule 1
PAO (s63 PAO)
satisfaction of the deceased wishes of distribution
conversion of property subject to trust
express trust for sell provided in the will
s62 PAO trust for sell implied.
Protection of purchase from estate
Purchaser would be protected under common law if he/she
satisfy as equity's darling.
Further protection by s66(4) & (5) and s67 PAO
s15 TO provides receipt given by trustee good discharge.
The personal representative have a fiduciary duty under
common law and statutes (s55 PAO) to get best possible
value for the estate.

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Debts, funeral, testamentary or administration expenses

Funeral, testamentary or administration expenses
Check to see whether the estate is solvent or not.
Funeral expenses must be reasonable and will be
indemnified by the personal representative.
Testamentary expenses on grant of probate allowed
Administration expenses allowed
Debt and taxes
s64 PAO which provides that a property with charges shall
pay by the property applies unless contrary intention is
expressed in the will.
The priority/order for payment of debts provided under Part
2 of Schedule to PAO, can be varied by contrary intention on

drafting of will.
Protection of the Personal Representative
Ascertaining debts by advertisement inviting claims against
the estate under s29 TO.
should specify time within which claim must be made.
2months usually from the date of advertisement
the personal representative will distribute on expiry of
the time limit and is liable to the extent of claims which
they had notice
however creditors can trace into the hands of the
beneficiary but there is a limit.
By way of an ex-parte application to the probate registrar for
an order limiting the time creditor can make claims against
the estate under NCPR 60A.
if creditor does not respond within time limit permission
will be given to the personal representative to distribute.
more expensive than advertising so usually used for big
estate.
Set aside funds for future claims and later distribute the
balance.
Insure against possible liability and distribute now
Obtain indemnity from the beneficiaries in order to
distribute now but in terms of effectiveness it is usually the

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last resort.
If the personal representative cannot be able to trace a
beneficiary then could apply for a Benjamin order:
A court order to distribute on the footing that a
beneficiary is dead.
Could apply after the personal representative had been
looking for the beneficiary for 7 years
Distribute on the footing that the beneficiary in question
is dead.
If the beneficiary appear after distribution he need to
apply tracing against the other beneficiaries.
Distribution
Beneficiaries
According to s71 PAO, estate would not normally be
distributed in the first year.
According to s69 PAO gives the power to appoint trustee to
minor beneficiary thereby releasing liability of the personal
representative.
s62(3) PAO provides that the personal representative could
only to invest the share of the residuary estate in authorised
investment under Schedule 2 TO.
Missing beneficiaries - How do the personal representative
distribute to unknown people?
By advertise;
Search birth and death register;
Employ investigator;
Obtain court direction; or
Benjamin order - leave is given by the court to allow the
personal representative to distribute on the assumption
that the beneficiary is dead if that beneficiary left Hong
Kong and has not been heard of for 7 years. Such an
order discharge the personal representative from
liability and when the beneficiary re-appear then could
trace property into the hands of other beneficiaries.
Gifts

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Failure by:
lapsing - when the beneficiary predeceased the testator
the gift fail
Notice s23 WO which provides that a will contains a
gift to a child of the testator and the child dies
before the testator leaving issue who are living at
the testator's death, then the gift goes to the issue
unless a contrary intention appears from the will.
ademption - failure of a specific gift as it was not in
existence at the time of death of the testator.
abatement - If the assets of the estate after paying off
debt fail to satisfy all legacies stipulated in the will, then
general legacies will be reduced pro-rate then followed
by specific legacies.
hotchpot - only for intestacy provided under s5 (Issue)
or s8 (Spouse) IEO.
disclaimer - that the beneficiary don't want the gift so
lapsed into residue if no substitute provided
s10 WO - Gift to beneficiary who attested the will.
s15 WO - Gift to spouse at the time of the will whom had
divorced subsequently.
Income and interest
Income on specific legacy not entitle to interest
However, if property vested is producing income
then the income would also be vested to the
beneficiary and arises after the death of the
testator.
If the contingent gift carry income then s33TO applies
unless contrary intention provided in the will. (e.g.
Income shall be added to capital and will devolve with
capital)
Management pending distribution

The personal representative manage the property until final
distribution to be done.
Difference between personal representative and trustees:

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Trustees must act jointly and may retire;

Chain of execution applies only to executor (s34 PAO);
Power of investment (s4 and Schedule 2 TO)
Power of maintenance by application of income to
contingent beneficiaries (s33TO)
Power of advancement of capital (s34TO)
Distribution
Appropriation
General power of appropriation under s68PAO
Requires consent from the person whom the
appropriation is made on his favour; and
Specific gift is not prejudiced.
Could provide contrary intention to s68 PAO in the will
If exercised, would bind every person who has interest in
the property
If shares are appropriated the beneficiary bear the
stamp duty
Note s7 IEO appropriation of matrimonial home personal
to spouse only and payment of equality money only
applies to intestacy
Assent
Release of property to beneficiary which does not
require payment of debt
s 66 PAO provides that personal representative have
power to assent.
Formalities only applies to real property
Either take a vesting assent or conveyance
Written assent concerning land have to be registered at
the Land Registry
Assent is necessary where the personal representative is
also a beneficiary and property is land.
In effect the personal representative must take a
step to transfer the property vested to his hands
under the capacity of a personal representative to
himself in personal capacity beneficially.

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Assent of chattels no formal procedure required

Assent of shares must be registered with the company
that issued the shares or the share registry
Power of the personal representative

1.
Power to postpone distribution under s71 PAO

The personal representatives are not bound to distribute the
estate of the deceased before the expiration of one year
from death.
In other words, the beneficiaries cannot insist on earlier
distribution, even if the testator directed payment within
a short period after death.
Does not affect the personal representative's duty to pay
debts
ii.
Power of appropriation under s68 PAO

Appropriation is the vesting of property in the estate to the
beneficiary.
s68 PAO gives the personal representatives power to
appropriate any or part of the estate in or toward
satisfaction of any legacy or interest or share in the estate
of the deceased, provided that such an appropriation does
not prejudice any specific beneficiary.
s68 PAO applies to BOTH testate or intestate situation
Must get consent of all the beneficiary under s68 PAO
Unless provided to the contrary in the will to expand the
personal representative's power to appropriate assets
without the consent of all the beneficiaries.
The asset is valued at the date of the appropriation, not at
the date of death.
However, unlike s7 IEO, no provision to pay for equality
money under s68 PAO.
Common for wills to provide contrary to s68 PAO that the
personal representative need not obtain the consent of the
beneficiaries to an appropriation. (Reasons being that
traditionally a written consent to appropriate is being

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considered by the IRD as a contract for transfer so in some

cases might attract stamp duties (eg. consent to appropriate
real properties or shares))
"The executors/trustees are empowered to exercise the
power of appropriation conferred by s68 of the Probate
and Administration Ordinance without obtaining any of
the consents required by that section."
If the beneficiary has a pecuniary interest in the estate but
there is not sufficient monetary asset to distribute can you
give another asset in satisfaction of that pecuniary interest?
Yes if compliance under s68 PAO (consent of the
beneficiary, employment of valuator on asset), or
alternatively sell assets under s54 PAO statutory power

of trust for sale and use money to satisfy the
beneficiary's interest.
iii.
Power of maintenance under s33 TO

A statutory power to enable the personal representatives to
apply available income for the maintenance, education or
benefit of minor beneficiaries.
Where property is held for a minor beneficiary who is
unmarried and the gift carries with it the right to
intermediate income, the personal representatives have
discretion to apply the income for the maintenance,
education and benefit of the minor.
If the personal representative does not apply the income,
they must accumulate it.
In exercising this discretion the personal representatives are
directed to consider the age and requirements of the minor,
the circumstances of the case generally and in particular
what other income, if any, is applicable for the same
purposes.
Could draft a clause in the will contrary to s33 TO to
empower the personal representative unfettered discretion
so that they need not consider other sources of income
available to the minor.

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iv.
"The executors/trustees shall exercise their power of

maintenance free from any obligation to apply a
proportionate part only of income where other income is
applicable for maintenance purposes."
Entitlement to income of a contingent interest under s33

TO
Where property producing income is held under a
contingent interest, before the contingency is satisfied the
beneficiary, if 18 or married or died before fulfilling the
contingency, is entitled to income produced by that property
before satisfaction of the contingency.
Under s33(1) TO, for a minor contingent interest that
produces income, the minor is entitled to income once
he/she reaches 18 or got married.
If income from the property was accumulated because the
minor beneficiary had not attained 18 or got married, once
he/she attained 18 or got married the beneficiary is entitled
to the accumulated income.
The personal representative must pay income to the
contingent beneficiary once he/she attained 18 or marriage
until death before contingency fulfilled.
Before the beneficiary attained 18, the personal
representative may exercise discretion to consider paying
income to the minor beneficiary.
In exercising the discretion, the trustee shall:
have regard to the age of the infant;
his requirements; and
what other sources of income, if any, does the minor
beneficiary is enjoying for the time being. The
personal
representative
may
pay
only
a
proportionate part of the income only to that minor
beneficiary where other income is applicable for the
maintenance of the minor beneficiary.
Could draft a clause in the will contrary to s33 TO to remove
the right to income before contingency is fulfilled by

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beneficiary.
"The income from my estate shall vest with the capital."
Could draft a clause in the will contrary to s33 TO to give
personal representative unfettered right to maintain a minor
beneficiary.
"My Trustees shall have power to exercise their power of
maintenance free from any obligation to apply only a
proportionate part only of income where other income is
applicable for maintenance purposes."
v.
Power of advancement under s34 TO
A statutory power to provide the personal representatives
absolute discretion to apply capital for the advancement to

any beneficiary who has either a vested or contingent
interest.
If a beneficiary with contingent interest dies after receiving
an advance and without fulfilling the contingency the
personal representative have no right to recover property
from the estate of the deceased beneficiary.
There are three limitation to statutory power of
advancement:
May only advance up to one-half of the beneficiary's
vested or presumptive share. (s33(1)(a))
Any advance made must be brought into account when
the beneficiary becomes absolutely entitled to the
legacy. (s33(1)(b))
Any person with a prior interest must consent to the
advance. (s33(1)(c))
the statutory limitation.
"The executors/trustees shall exercise their power of
advancement free from the provisions restricting the
advancement of any person to one half of his or her
presumptive or vested share or interest so as to
authorise the application of the whole of such
presumptive share or interest by way of advancement."

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vi.
Power of investment under s4TO

A statutory power to provide the personal representatives to
invest capital of the estate.
The personal representatives may only invest the monies
held on trust into authorized investment as listed in
Schedule 2 TO.
Some of the allowed investment under Schedule 2 TO are as
follows:
shares of listed company in Hong Kong with market
capitalization of not less than $10 billion and the
company had declared and paid dividend for the past 5
years
any debt security which is issued by, or the payment of
principal and interest on which is guaranteed by the
Hong Kong government
the statutory limitation.
"The executors/trustees is empowered to invest money
and to vary and transpose investments from time to
time with the same full and unrestricted freedom to
choose investments as if they were a sole absolute
beneficial owner"
Further, since to purchase a property for beneficiaries to live
in does not fall as an investment, as it does not generate
income, so usually besides the provision to take out the
limitation of power under s4TO, a will might also provide for
the power for the personal representative to purchase a
property for the beneficiaries to live in.
"The executors/trustees is empowered to apply money
in the purchase or improvement of land as a residence
for all or any of the beneficiaries for the time being of
any trust hereof on such terms as they may in their
absolute discretion from time to time impose"
In any case, the personal representative have to be prudent
in investing the capital from the estate as they owe a

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fiduciary duty to the beneficiaries, so the personal

representative should invest in prudent investments.
vii.
Power to appoint trustees of infant's property under s69

PAO
If a gift is vested to a minor, in absence of a valid minors
receipt clause, because he/she could not give valid receipt,
the personal representative could not discharge his/her duty
unless waiting until the minor beneficiary to attain
adulthood.
In the absence of a minors receipt clause, even the
minor's parents, guardian or adult spouse can give one
on his/her behalf. (Note: A married minor can give a
good receipt for income)
Personal representatives who, without authority, pay a
child's legacy to a parent, guardian or adult spouse are
in danger of personal liability to account to the minor
when he/she attains adulthood.
s69 PAO gives personal representatives a power, where a
minor is absolutely entitled to property, to appoint from two
to four trustees of the property for the minor.
In this case, the personal representative may transfer
property to the trustees and a receipt signed by those
trustees will be a valid discharge to the personal
representative.
Condition precedent to application of s69 PAO - THE GIFT
MUST BE VESTED.
The power is not available where the minor merely has a
contingent interest.
In the absence of express authority the personal
representatives will either have to continue holding the
property until the minor attains adulthood or
appropriation or payment into court.
viii.
Co-ownership of property by the deceased with others
(a) If the deceased co-owned a property with another under

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Joint Tenancy, then:

under the right of survivorship the deceased's interest in the
property shall pass to the co-owner at his death regardless
of any provision for that property in the will.
if you have a situation whereby a property was co-owned
under Joint Tenancy by the testator with another, if the
testator want to give his share of interest to another under
will what can he do?
The testator can sever the Joint Tenancy
The joint tenancy can be severed in one of the three
ways:
(i) an act of any one of the persons interested
ix.
operating upon his own share may create a

severance as to that share;
(ii) by mutual agreement; and
(iii) by any course of dealing sufficient to show that
the interests of all were mutually treated as
constituting a tenancy in common.
If a joint tenancy is severed, the party severing will be
entitled to a share of beneficial ownership equivalent to
an equal share with the other tenants this will be the
case even where the initial contributions of the joint
tenants to the purchase price of the property were NOT
equal.
Once severed, the co-ownership becomes Tenants in
Common
Once the Joint Tenancy is severed, the testator shall hold
his/her share of interest in the property under tenancy in
common, so he/she could direct transfer that share of
interest under will.
2. If the deceased co-owned a property with
another under Tenancy in Common, then:
The share of interest of the deceased in the property
shall fall into his/her estate for distribution.
Shares as part of estate

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In any case check whether gift of shares are publicly listed

or not.
If gift is publicly listed shares there is requirement of
transfer of shares.
If left to charitable organization and it is private
company can the shares be freely transferred to a third
party? Look for preemptive rights in the articles of
association.
If partnership shares at least look at partnership
agreement to ascertain whether there is transfer of
partnership share upon succession clause.
In exam question there might not be strict answer then
should state steps to dispose of shares.
x.
Payment of debts by solvent estates
s63(3) PAO and part 2 of Schedule 1 to PAO
Simplify order for payment of debt for solvent estate:
(i) Property undisposed of by the will - subject to fund for
pecuniary legacies
(ii) Residue - subject to fund for pecuniary legacies
(iii) Property specifically given for payment of debts - no
provision for any surplus
(iv) Property charged with the payment of debts - with provision
for any surplus
(v) Pecuniary legacies - rateably
(vi) Specific legacies - rateably
If testator provide a contrary intention expressed in the will
for priority to satisfy debt, would override statutory priority
to pay debt.
"My Trustees shall pay my debts from my residuary
estate..." - Payment of debts from residuary estate.
s64 PAO payment of mortgage bourne from the mortgaged
property itself.
Exception to s63 PAO
If testator provide a contrary intention expressed in the will
for the estate to satisfy mortgage, would override s64 PAO,

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but the words must be clear enough to convey such

intention. (s64(2) PAO)
"I give XXX property to ABC free of mortgage..."
xi.
Relevant statutes
Section 4 Trustee Ordinance - Authorized investments
(1) A trustee may invest any trust funds in his hands, whether at the time in a
state of investment or not(a)
in any investment specified in the Second Schedule;
(b) in any other investment (including deposits in a bank outside Hong

Kong) which may be authorized by the court on summary application for
that purpose made in chambers.
(2) Any application to the court made under subsection (1)(b) shall be made by
the trustee ex parte and shall be supported by affidavit.
(3) The Financial Secretary may from time to time by order published in the
Gazette amend the Second Schedule.
Section 71 Probate and Administration Ordinance - Power to

postpone distribution
Subject to the provisions of this Ordinance, a personal representative is not bound
to distribute the estate of the deceased before the expiration of one year from the
death.
Section 64 Probate and Administration Ordinance - Charges to be

paid primarily out of the property charged
(1) Where a person dies possessed of, or entitled to, or, under a general power
of appointment, by his will disposes of an interest in property which at the
time of his death is charged with the payment of money, whether by way of
legal mortgage, equitable charge or otherwise (including lien for unpaid
purchase money), and the deceased has not by will, deed or other document
signified a contrary or other intention, the interest so charged shall, as
between the different persons claiming through the deceased, be primarily
liable for the payment of the charge; and every part of the said interest,
according to its value, shall bear a proportionate part of the charge on the
whole thereof.

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(2) Such contrary or other intention shall not be deemed to be signified(a)
by a general direction for the payment of debts or of all the debts of the
testator out of his movable property or of his residuary estate; or
(b) by a charge of debts upon any such estate,

unless such intention is further signified by words expressly or by necessary
implication referring to all or some part of the charge.
(3) Nothing in this section affects the right of a person entitled to the charge to
obtain payment or satisfaction thereof either out of the other assets of the
deceased or otherwise.
Section 68 Probate and Administration Ordinance - Powers of

personal representative as to appropriation
(1) The personal representative may appropriate any part of the movable or
immovable property, including things in action of the deceased in the actual
condition or state of investment thereof at the time of appropriation in or
towards satisfaction of any legacy bequeathed by the deceased, or of any
other interest or share in his property, whether settled or not, as to the
personal representative may seem just and reasonable, according to the
respective rights of the persons interested in the property of the deceased.
(2) Notwithstanding the provisions of subsection (1)(a)
an appropriation shall not be made under this section so as to affect

prejudicially any specific devise or bequest;
(b) an appropriation of property, whether or not being an investment

authorized by law or by the will, if any, of the deceased for the
investment of money subject to the trust, shall not (save as hereinafter
mentioned) be made under this section except with the following
consents(i)
when made for the benefit of a person absolutely and beneficially

entitled to possession, the consent of that person;
(ii)
when made in respect of any settled legacy, share or interest, the

consent of either the trustee thereof, if any (not being also the
personal representative) or the person who may for the time being
be entitled to the income,
and if the person whose consent is so required as aforesaid is a minor or

a mentally disordered person, the consent shall be given on his behalf

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by his parents or parent, testamentary or other guardian, committee or
receiver, or if, in the case of a minor, there is no such parent or
guardian, by the court on the application of his next friend;
(c)
no consent (save of such trustee as aforesaid) shall be required on

behalf of a person who may come into existence after the time of
appropriation, or who cannot be found or ascertained at that time;
(d) if no committee or receiver of a mentally disordered person has been

appointed, then, if the appropriation is of an investment authorized by
law or by the will, if any, of the deceased for the investment of money
subject to the trust, no consent shall be required on behalf of the
mentally disordered person;
(e)
if, independently of the personal representative, there is no trustee of a

settled legacy, share or interest, and no person of full age and capacity
entitled to the income thereof, no consent shall be required to an
appropriation in respect of such legacy, share or interest so long as the
appropriation is of an investment authorized as aforesaid.
(3) Any property duly appropriated under the powers conferred by this section
shall thereafter be treated as an authorized investment, and may be retained
or dealt with accordingly.
(4) For the purposes of such appropriation, the personal representative may
ascertain and fix the value of the respective parts of the movable and
immovable property and the liabilities of the deceased as he may think fit,
and shall for that purpose employ a duly qualified valuer in any case where
such employment may be necessary, and may make any transfer or
conveyance (including an assent) which may be requisite for giving effect to
the appropriation.
(5) An appropriation made pursuant to this section shall bind all persons
interested in the property of the deceased whose consent is not hereby
made requisite.
(6) The personal representative shall, in making the appropriation, have regard
to the rights of any person who may thereafter come into existence, or who
cannot be found or ascertained at the time of appropriation, and of any other
person whose consent is not required by this section.
(7) This section does not prejudice any other power of appropriation conferred
by law or by the will (if any) of the deceased, and takes effect with any
extended powers conferred by the will (if any) of the deceased, and where an

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appropriation is made under this section in respect of a settled legacy, share
or interest, the property appropriated shall remain subject to all trusts for
sale and powers of leasing, disposition and management, or varying
investments, which would have been applicable thereto or to the legacy,
share or interest in respect of which the appropriation is made, if no such
appropriation had been made.
(8) If after any immovable property has been appropriated in purported exercise
of the powers conferred by this section, the person to whom it was
transferred or conveyed disposes of it or any interest therein, then, in favour
of a purchaser, the appropriation shall be deemed to have been made in
accordance with the requirements of this section and after all requisite
consents, if any, had been given.
(9) In this section, a settled legacy, share or interest includes any legacy, share
or interest to which a person is not absolutely entitled in possession at the
date of the appropriation, also an annuity, and "Purchaser" ( ) means a
purchaser for money or money's worth.
(10) This section applies whether the deceased died intestate or not, and whether
before or after the commencement of this Ordinance, and extends to
property over which a testator exercises a general power of appointment,
and authorizes the setting apart of a fund to answer an annuity by means of
the income of that fund or otherwise, but is subject to the provisions of
section 54.
Section 33 Trustee Ordinance - Power to apply income for

maintenance and to accumulate surplus income during a minority
(1) Where any property is held by trustees in trust for any person for any
interest whatsoever, whether vested or contingent, then, subject to any prior
interests or charges affecting that property(a)
during the infancy of any such person, if his interest so long continues,
the trustees may, at their sole discretion, pay to his parent or guardian,
if any, or otherwise apply for or towards his maintenance, education or
benefit, the whole or such part, if any, of the income of that property as
may, in all the circumstances, be reasonable, whether or not there is(i)
any other fund applicable to the same purpose; or
(ii)
any person bound by law to provide for his maintenance or

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education; and
(b) if such person on attaining full age has not a vested interest in such
income, the trustees shall thenceforth pay the income of that property
and of any accretion thereto under subsection (2) to him, until he either
attains a vested interest therein or dies, or until failure of his interest:
(Amended 32 of 1990 s. 8)
Provided that, in deciding whether the whole or any part of the income of the
property is during a minority to be paid or applied for the purposes aforesaid,
the trustees shall have regard to the age of the infant and his requirements
and generally to the circumstances of the case, and in particular to what
other income, if any, is applicable for the same purposes; and where trustees
have notice that the income of more than one fund is applicable for those
purposes, then, so far as practicable, unless the entire income of the funds is
paid or applied as aforesaid or the court otherwise directs, a proportionate
part only of the income of each fund shall be so paid or applied.
(2) During the infancy of any such person, if his interest so long continues, the
trustees shall accumulate all the residue of that income in the way of
compound interest by investing the same and the resulting income thereof
from time to time in authorized investments, and shall hold those
accumulations as follows(a)
if any such person(i)
attains full age, or marries before attaining full age, and his interest
in such income during his infancy or until his marriage is a vested
interest; or
(ii)
on attaining full age or on marriage before attaining full age

becomes entitled to the property from which such income arose
absolutely,
the trustees shall hold the accumulations in trust for such person
absolutely, and so that the receipt of such person after marriage, and
though still an infant, shall be a good discharge; and (Amended 32 of
1990 s. 8)
(b) in any other case the trustees shall, notwithstanding that such person
had a vested interest in such income, hold the accumulations as an
accretion to the capital of the property from which such accumulations
arose, and as one fund with such capital for all purposes, but the

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trustees may, at any time during the infancy of such person if his
interest so long continues, apply those accumulations, or any part
thereof, as if they were income arising in the then current year.
(3) This section applies in the case of a contingent interest only if the limitation
or trust carries the intermediate income of the property, but it applies to a
future or contingent legacy by the parent of, or a person standing in loco
parentis to, the legatee, if and for such period as, under the general law, the
legacy carries interest for the maintenance of the legatee, and in any such
case as last aforesaid the rate of interest shall (if the income available is
sufficient, and subject to any rules of court to the contrary) be $5 per cent
per annum.
(4) This section applies to a vested annuity in like manner as if the annuity were
the income of property held by trustees in trust to pay the income thereof to
the annuitant for the same period for which the annuity is payable, save that
in any case accumulations made during the infancy of the annuitant shall be
held in trust for the annuitant or his personal representatives absolutely.
(5) This section does not apply where the instrument, if any, under which the
interest arises came into operation before the commencement of this
Ordinance.
Section 34 Trustee Ordinance - Power of advancement

(1) Trustees may at any time or times pay or apply any capital money subject to
a trust, for the advancement or benefit in such manner as they may, in their
absolute discretion, think fit, of any person entitled to the capital of the trust
property or of any share thereof, whether absolutely or contingently on his
attaining any specified age or on the occurrence of any other event, or
subject to a gift over on his death under any specified age or on the
occurrence of any other event, and whether in possession or in remainder or
reversion, and such payment or application may be made notwithstanding
that the interest of such person is liable to be defeated by the exercise of a
power of appointment or revocation, or to be diminished by the increase of
the class to which he belongs:
Provided that(a)
the money so paid or applied for the advancement or benefit of any

person shall not exceed altogether in amount one-half of the
presumptive or vested share or interest of that person in the trust

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property; and
(b) if that person is or becomes absolutely and indefeasibly entitled to a
share in the trust property the money so paid or applied shall be
brought into account as part of such share; and
(c)
no such payment or application shall be made so as to prejudice any

person entitled to any prior life or other interest, whether vested or
contingent, in the money paid or applied unless such person is in
existence and of full age and consents in writing to such payment or
application.
(2) This section applies only where the trust property consists of money or
securities or of property held upon trust for sale calling in and conversion,
and such money or securities, or the proceeds of such sale calling in and
conversion are not by statute or in equity considered as land.
(3) This section does not apply to trusts constituted or created before the
commencement of this Ordinance.

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Inheritance
Ordinance
(Provision
for
Family
and
Dependants)
IPFDO applies for both testate and intestate situation

Claims must be made within six months of a grant being taken
out by the applicant.
Claim is against the net estate so debts could be paid out first
from the estate.
Circumstance where the people who are not happy about what
they have or have not received from the deceased estate can
apply as long as the applicant under IPFDO can prove that:
he/she have locus under the categories of suitable
applicants (s3(1) IPFDO); and
was substantially or wholly supported financially by the
deceased immediately before the deceased's death; and
the applicant is applying for reasonable maintenance.
A beneficiary under categories as provided in s3(1) IPFDO can
apply (categories similar to s4 IEO):
surviving spouse
former spouse
spouse must be recognised by law
parent of the deceased
infant child
adult child
anyone treated as a child
Elements of maintenance - there must be:
contribution of money or monies worth; and
the contribution was substantial towards the reasonable
needs of the applicant; and
contribution was made otherwise than for full valuable
consideration
The crucial question is that the applicant must show some
pattern of dependence
The question of immediacy must be looked at the circumstances
Court would look at relevant guideline specific to the categories.
general applies to all categories
General guidelines look at financial resources/means of

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the applicant or their conduct or the size of the estate.

depend upon how many people apply; and
the physical and mental capacity and conduct of the
applicant
Specific guideline only applies to the categories
for spouse, look at duration of marriage.
for parents, look at their age and contribution in money
or money's worth made by the deceased towards the
applicant's needs immediately before the deceased's
death
for infant child of full blood, the manner in which the
applicant might expect to be educated or trained
if the child of the family the crucial question is that
whether the deceased had assumed responsibility
knowing the child is not his
siblings looking at the extent of the support payment
and whether the sibling should expect the maintenance
to continue.
other persons look at the closeness of relationship
immediately before the deceased death
Maintenance standards
Surviving
spouse
standard
higher
than
ordinary/maintenance standard.
Surviving spouse standard intends to give the
surviving spouse a share of the assets in the estate.
Ordinary/Maintenance
standard
is
merely
for
maintenance of the applicant.
Test for maintenance: "the deceased, otherwise than
for valuable consideration was making a substantial
contribution in money or money's worth towards the
reasonable needs of that person." (s3(3) IPFDO)
Objective standard - Each case depends on his own
facts.
Statement made by the deceased. (s23 IPFDO)
Court would not consider legally unenforceable
assurance made by the deceased. (s13 IPFDO)

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Court under s4 IPFDO can make appropriate orders like:

periodic payments
lump sum payments
transfer of property
settlement of property
acquisition of property for transfer or settlement.

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