Wills & Probate DB Ch.

4
1. Introduction p.155
- Wholly or partially intestate (leaving will which doesnt dispose all property)
(1) Intestates Estate Ordinance (IEO) (applies to intestate death after
7/10/1971)
- Before IEO: Qing Law and English law for non-Chinese person
(2) Intestacy rules only apply to property capable of being left by will
- Doesnt apply to joint property (pass by survivorship/nominations/donation mortis
causa)
(3) Intestacy rules only benefits people with direct blood link (apart from
surviving spouse)
- Doesnt benefit unmarried partners (hetero/homo), step-children, parents-in-law

2. Intestacy
- Reasons not having a will: below 18; above 18 but not considered will; forgot;
choose not to; revoked by marriage; lack mental competence; defective execution
(invalid)
(1) Partial intestacy (p.156): deceased dies leaving valid will not effectively
dispose of whole estate, e.g.
i. Will doesnt contain clause disposing residuary estate
ii. Gift of residue fails and no effective substitution of beneficiary under will or s23
WO1
iii. Any part not disposed of by will passes according to IEO
iv. S.2 IEO: intestate means person dies intestate as to some beneficiary interest
in his estate

3. Statutory Trust for Sale

(1) S.62 Probate and Administration Ordinance: personal representatives
holds
i. Intestates undisposed of immovable property on trust for sale and
ii. Undisposed of moveable property on trust to call in, sell and convert into money
with power to postpone same and conversion as they think fit
1 S.23WO: (1) Where (a) a will contains a devise or bequest to a child or remoter descendant
of the testator; and(b) the intended beneficiary dies before the testator, leaving issue; and
(c) issue of the intended beneficiary are living at the testator's death, then, unless a
contrary intention appears from the will, the devise or bequest shall take effect as a devise
or bequest to the issue living at the testator's death.

iii. Unless with special reason, cannot sell reversionary or future interest until falls
into possession (e.g. interest in remainder)
(2) S.62 requires personal representative to pay funeral and testatmentary
expenses, debts and other liabilities and pecuniary legacies out of the proceeds of
the sale and conversion and intestates ready money
(3) Residuary estate (s.2 IEO2): left after these payments are made; shared
among beneficiaries (IEO)
(4) Statutory Trust for Sale is subject to any express trust for sale in a valid will
(5) S.54(1)PAO: all personal representatives must concur in sale of immovable
property
- Wo Yu Wai v Chan Wei Tsun: if only one personal representative, can have
power to convey

4. Order for Entitlement (p.157)

(1) Depends on relationship to the intestate; relationship must be proved
- Usually done by relevant birth/marriage/death certificates
(a) Table of intestate entitlement before 1995 amendment
Relating Surviving
1. Spouse

2. Spouse and
issue

Other relatives
No issue, or parent
or brother or sister
or issue of a
brother or sister
Other relatives
immaterial

3. Spouse and
parent or brother
or sister or issue of
brother or sister

No issue

4. Issue

No spouse

Entitlement
All to spouse

IEO
s.4(2)

Spouse takes
$50,000 and half
of residue; other
half is held on
statutory trusts for
issue
Spouse takes
$200,000 and half
of the residue; the
other half is held
for parent(s) or on
statutory trusts for
brothers or sisters
All to issue on
statutory trusts

s. 4(3)

s.4(4)

s.4(5)

2 "residuary estate" means every beneficial interest in an estate as to which a person dies
intestate, afterpayment of all such funeral and administration expenses, debts and other
liabilities as are properly payable
thereout, which (otherwise than in right of a power of appointment) he could, if of full age
and capacity, have disposed of by his will.

5. Parent(s)
6. Brothers and
sisters

No spouse, no
issue
No spouse, no
issue, no parent

7. Grandparent(s)

None of the above

8. Uncles and
aunts

None of the above

9. None of the
above relatives

All to parent(s)

s.4(6), 4(7)

All to brothers and

sisters on
statutory trusts
All to
grandparent(s)
All to uncles and
aunts on statutory
trusts
All to Crown as
bona vacantia

s.4(8)

s.4(8)
s.4(8)

s.4(9)

(b) Table for intestate entitlement as amended in 1995 (p/158)

Relative surviving
1. Spouse

2. Spouse and
issue

Other relatives
No issue, or parent
or brother or sister
of the whole
blood, or issue of a
brother or sister of
the whole blood
Other relatives
immaterial

3. Spouse and
parent or brother
or sister of the
whole blood or
issue of a brother
or sister of the
whole blood

No issue

4. Issue

No spouse

5. Parent(s)

No spouse, no
issue
No spouse, no
issue, no parent

6. Brothers and
sisters of the

Entitlement
All the spouse

IEO
s.4(2)

Spouse takes
personal
chattel,
$500,000 and
half of the
residue; other
half held on
statutory trusts
for issue
Spouse takes
personal chattel,
$1,000,000 and
half of the residue;
other half held for
parents or on
statutory trusts for
brothers or sisters
of the whole
blood
All to issue on
statutory trusts
All to parent(s)

s.4(3)

All to brothers and

sisters of the

s.4(8)

s.4(4)

s.4(5)
s.4(6), 4(7)

whole blood
7. Brothers and
sisters of the half
blood

8. Grandparent(s)
9.
Uncles
aunts

and

No spouse, no
issue, no parent,
no brothers and
sisters of the
whole blood
None of the above
None of the above

10. None of the

above relatives

whole on the
statutory trusts
All to brothers and
sisters of the half
on the statutory
trusts
All to
grandparent(s)
All to uncles and
aunts on statutory
trusts (brothers
and sisters of the
whole blood of a
parent of the
intestate)
All to government
is bona vacantia

s.4(8)

s.4(8)
s.4(8)

s.4(9)

- Sum paid to surviving spouse is called the statutory legacy

5. The surviving spouse p.159

(1) Scenarios
i. Intestate leaving only the spouse
ii. Intestate leaving spouse and issue
iii. Intestate leaving spouse and issue and parent(s) or brother(s) and sister(s) of
whole blood (or their issue)
(2) husband and wife: means husband or wife of a valid marriage (s.2 IEO)
(3) S.3 IEO: Valid marriage is,
(a) Marriage celebrated or contracted under Marriage Ordinance (Cap.181)
(b) Modern marriage validated by Marriage Reform Ordinance (cap.178)
(c) Customary marriage declared valid by MRO; or
(d) a valid foreign marriage
(4) Customary marriage (p.160)
- s7(1)MRO: Must be celebrated in HK before 7/10/1971 in accordance with
Qing customary law
- s7(2) MRO: presumption that marriage is deemed to accord with Chinese law and
custom if celebrated before 7/10/1971 in HK or in a place recognised by family as
family place of origin.
- s7(2)MRO: recognises polygamous marriages, e.g. concubinage
- Concubinage: there must be intention among parties (man, principal wife and the

tsip) to form concubinage; and acceptance by the wife and recognition of tsip by
mans family
- ***NOTE if customary marriage not validated under MRO; evidence to prove the
marriage
(5) Decree absolute of divorce: before decree absolute of divorce is obtained, a
marriage is still valid
- if X dies intestate after decree nisi but before decree absolute, Xs spouse qualifies
as spouse
(6) Judicially separated spouses (p.161)
- s4A IEO: judicially separated spouses not entitled to claim in intestacy of each
other
(7) Unmarried cohabitants: no provision for cohabitants
- IEO doesnt provide for unmarried cohabitants
- Might have right of survivorship
- Might have claim in equity (resulting trust)
(8) Survival
- Doesnt matter how long spouse survives the deceased
- Property passes to spouse even though only survives for few minutes
- E.g. both involved in accident, X died instantly and Y died on way to hospital;
spouse entitlement pass from estate of X to estate of Y
(9) Commorientes provision
- Commorientes rule: if cant tell who died first, presumed the older one did
i. s4(1))IEO: when its not possible to tell intestate or his spouse died first, it is
presumed that the spouse didnt survive the intestate
- This means each spouse is taken to have pre-deceased the other; right of the
surviving spouse is ignored when distributing under intestacy
ii. s11 CPO: commorientes rule applies in any other cases
- SO if husband dies testate and wife dies intestate, s11 applies to husbands estate
and s4(11) IEO applies to wifes estate.

6. Entitlement of the surviving spouse (p.162)

(a) Statutory legacy
- Paid out first: free of costs and expenses together with interest from date of
death to date of payment
- Interest: s49(1)(b) High Court Ordinace
- If net disposed of estate is less than statutory legacy, surviving spouse will inherit
whole undisposed of estate
- s.6 IEO: personal representatives can raise statutory legacy on the security of
residuary estate (would do this if estate has assets that cant be sold quickly and
spouse needs cash)

(b) Personal chattels

- Surviving spouse is entitled to chattels absolutely
- S.2 IEO: Personal chattels is things situated at the time of the intestate's death
at any residence of a surviving husband or wife of the intestate, namely furniture,
clothes, articles of adornment, articles of household, personal, recreational or
decorative use, consumable stores, garden effects and domestic animals; and (b)
motor vehicles and accessories, but does not include any chattel used exclusively or
principally for business or professional purposes, or money or securities for money
- S.2 includes items belonging to intestate that are at any residence of the surviving
spouse at the time of death
- Items used partially for business purposes doesnt fall within s.2
- S.2 excludes money, or securities for money

(c) The matrimonial home

- Spouse doesnt have automatic entitlement to matrimonial home under
intestacy rules
- Spouse might be entitled under property law:
i. Right of survivorship
ii. By virtue of spouses own contribution to the acquisition of the property
iii. By establishing a right to a share by virtue of proprietary estoppel
(i) Appropriation of the matrimonial home
- s7 IEO: surviving spouse has right to elect the personal representatives
appropriate the matrimonial home or partial satisfaction of the spouses interest in
the intestates estate
- Sch.2 IEO sets out terms of making the election
- S7 IEO: allows surviving spouse to buy the matrimonial home or the intestates
interest
a. The deceased must own the matrimonial home or an interest in the home
- Matrimonial home is the premises the surviving spouse was residing at the time of
the intestates death; doesnt matter if the intestate also resided there
b. Right is exercised by written notice to personal representatives within 12
months of grant of representation
- Cannot be sold before that period without written consent of surviving
spouse except in course of administration when other assets are insufficient to pay
debts and expenses
- Surviving spouse has no better right than buyer for valuable consideration
- A personal right: right to appropriate cannot be made after surviving spouses
death
(ii) Consent of court is required when:
a. Matrimonial home forms part of building and residuary estate comprises interest
in the whole of building (unclear; but problem of undivided shares?)

b. Matrimonial home was at date of intestates death used partly for purpose other
than domestic purpose
- Court must be satisfied appropriation doesnt diminish value of assets in
residuary estate or make them more difficult to dispose of
- ***If surviving spouse is sole personal representative cannot appropriate,
unless appoint another personal representative or consent of all beneficiaries or
court

(d) Power of appropriation

- s68 PAO:
a. Power of personal representative to appropriate deceaseds property in
satisfaction of beneficiarys share in the estate
b. Beneficiaries must consent to the appropriation;
c. exercise of the power must not prejudice specific gifts
d. NO time limit on exercise of power
e. NO requirement to apply to court in certain cases
f. NO reference to payment of equality money
- Sch.2 IEO: permits equality money (value of matrimonial home appropriated
exceeds the value of the surviving spouses share in the intestates estate)

7. Issue of the Intestate

i. S.2(2) and (3) IEO: includes adopted children and children en ventre sa mere
(conceived but not born)
ii. Parent and Child Ordinance: Illegitimate children enjoy same rights as
legitimate
iii. Adopted children: under Chinese law and customs or under Adoption
Ordinance treated as children of the adopter
- Re Estate of Chang Fong: Adopted child has same legal status as a natural child
of the intestate
iv. Step-children: is not treated as a child unless adopted

8. Entitlement of issue of the Intestate

- S.5(1)(a)IEO: Issue of the intestate takes on the statutory trusts,
(i) Children of intestate take equal shares contingent upon attaining 18 or on
earlier marriage
(ii) Issue of any children who pre-decease intestate take equally per stirpes
contingent on attainting 18 or earlier marriage
(iii) Grandchild: cant take if parent is living and capable of taking
- Must be alive at intestates death
- Parent (child of the intestate) must have died before intestate
- Grandchild must attain 18 or earlier marriage

(a) Section 5(1)(b)IEO

- Statutory power of advancement and maintenance and accumulation of income
apply if beneficies have contingent interests (s33-34 TO)
(c) Section 5(1)(c) IEO (hotchpot provision)
i. On total or partial intestacy; and
ii. Any child received inter-vivos settlement of property or money by way of
advancement or gift in marriage; thus
iii. His share is reduced by the amount of the advance unless intestate showed
contrary intention
iv. Benefits paid or settled on grandchildren: not taken into account unless
grandchild takes per stirpes the share of a pre-deceased child
- Person alleging advancement must prove it; party alleging contrary intention must
prove it
v. Advancement
a. Taylor v Taylor: Advancement means something given by the parent to
establish the child in like or to make provision for him.
- E.g. payment made on marriage of the child
- Advancement is valued at date of death
vi. Contrary intention
- A subjective test
a. Hardy v Shaw: whether looking at all circumstances, it should be inferred that
the intestates intention was that the benefit shouldnt be brought into hotchpot
vii. Calculation of Advancement
[(undisposed + advancement) no. of children; then deduct
advancement]
- First, calculate undisposed of property plus any advancement
- Second, divide notional estate among the children
- Third, deduct advancement of share of the child in question and distribute
residue
- S5(1)(d) IEO: personal representatives can permit infants with a contingent
interest to have use and enjoyment of personal chattels
- S.5(1)(c)IEO doesnt apply if intestate only has one child

9. Statutory Trusts and Brothers, Sisters, Uncles

and Aunts of the Intestate
- Brothers and Sisters also take on statutory trusts
(i) Takes equal shares contingent on attaining 18 or earlier marriage
(ii) Issue of any brother of sister who pre-deceases take equally per stirpes
contingent

- Nieces and nephews only inherit if theyre alive at date of intestates death, and
parent died before intestate
- Statutory trusts apply in similar manner to uncles and aunts of the intestate
- Hotchpot provision (s5(1)(c)IEO) apply only to issue of the intestate; but s3334 TO apply wherever a beneficiary has a contingent interest

10. Foreign intestacy

(a) Surviving spouse
- s8A(2) IEO: interest acquired under intestacy or partial intestacy outside Hong
Kong diminish surviving spouses statutory legacy
- S8A(2) require spouse to bring the entitlement under foreign law into account to
exclude or diminish the Hong Kong net sum
- ***NOTE only statutory legacy is affected and reduced
- ***NOTE doesnt cover beneficiary interest of the intestates estate outside HK
which passes by will or by survivorship
(b) Beneficiaries other than the surviving spouse
- S.8A(3): interest acquired under intestacy or partial intestacy outside HK are
treated as satisfying a beneficiarys share under HK intestacy
- Must be brought into account

11. Interests acquired under a will when there is a

partial intestacy
(a) Surviving spouse
- S.8 IEO: surviving spouses statutory legacy and interest on the legacy is reduced
by the value at date of death of benefits taken under the will except personal
chattels specifically bequeathed
- If the value of benefits exceeds statutory legacy, statutory legacy is omitted
- Hotchpot rule doesnt affect spouses interest in the intestates residuary estate
(b) issue
- s8: issue of intestate must bring into account gifts received under the will
- Done same way as advancements are brought into account (s5(1)(c)IEO)