On 29-30 September 2016, our partners Ms. Wendy Lam and Ms. Janice Chin attended the International Family Law Conference with the theme “The Future of Family Justice – International and Multi-Disciplinary Pathways” held at the Supreme Court Auditorium, Singapore.

The Conference was co-organized by the Family Justice Courts of Singapore, the Law Society of Singapore and the Singapore Academy of Law. Eminent speakers from the legal, psychological and social science sectors shared their views on topics in relation to cross-border disputes, mediation, family violence and child abuse, future of family justice, etc. in order to explore how family judicial systems around the globe face these challenges and to facilitate exchange of insights at an international level. Participants include family judges and court administrators, family lawyers, policy makers, mental health professionals, etc. from various jurisdictions.

Please contact our Ms. Wendy Lam or Ms. Janice Chin for any enquiries or further information about this event.

On 26-27 September 2016, our Partner Ms Sherlynn Chan attended the “Symposium on Cross-Border Disputes Involving Children – Perspectives on Family Disputes Involving Children in a Globalized Society”, which was held at the Supreme Court Auditorium, Singapore. It was co-organized by the Family Justice Courts of Singapore and the Hague Conference on Private International Law (HCCH).

The event was well attended by leading judges in their respective jurisdictions, including Australia, Germany, Hong Kong, Japan, Malaysia, New Zealand, Singapore, the Netherlands, the United Kingdom, the United States of America, etc. The Honourable Chief Justice Diana Bryant AO, Family Court of Australia, delivered a keynote address on an overview of the present day issues faced by judges in cases involving children in cross-border situations and the related challenges faced by the judiciary in providing for the needs of the child.

The Hon. Madam Justice Bebe Chu, Judge-in-charge of the Family Court List in the High Court of Hong Kong, was also one of the panelists, who shared on the topic of judicial communications and collaboration from the perspective of Hong Kong.

Apart from panelists’ presentation, attendees were also given an opportunity to engage in interactive table discussion on issues, legal frameworks, practices and challenges in their jurisdictions with regard to different case scenarios.

On the second day, there was a lively presentation on recent developments in adopting mediation and cross-disciplinary approaches as a dispute resolution tool for international family disputes, including how judges collaborate internationally to support the role of mediation and expedite mediation in international custody, access and relocation cases.

Filled with fruitful discussion and sharing, the two-day symposium ended by the closing remarks given by Mr Anselmo Reyes, Representative, HCCH, Asia Pacific Regional Office, Hong Kong, followed by an official dinner held at Suntec Singapore Convention & Exhibition Centre in the evening of 27 September 2016.

Please contact our Ms Sherlynn Chan for any enquiries or further information about this event.

Fact

The Plaintiff issued a writ of summons against the Defendant, a PRC resident in China, and obtained leave under O.11 r.1(1) of the Rules of the High Court to serve a concurrent writ out of the jurisdiction on the Defendant at his residential address. The Plaintiff then requested that the writ shall be served through the judicial authorities of China, pursuant to O.11 r.5A. The Plaintiff later made a similar application for service at a commercial address. Both of the attempts failed. The Plaintiff then applied for and the Court ordered substituted service in Hong Kong, but not in China, through delivering by hand the documents marked for the attention of the Defendant care of the Hong Kong office of the solicitors for the Defendant.

The Defendant appealed on the ground that the Court had no jurisdiction to bypass O.11 r.5A by ordering substituted service in Hong Kong; alternatively such an order contravened the Basic Law and was beyond the jurisdiction of the Court.

The Court dismissed the Defendant’s appeal

The Court adopted a purposive approach in interpreting O.11, and ruled that “the objective of substituted service was to bring knowledge of the writ to the defendant by such means that would reach him in all reasonable probability.” Therefore, although not expressly stated, substituted service was applicable to the service of process on a mainland Chinese resident.

The Court then categorised substituted service into two types, namely substituted service to be effected on the Mainland, or in Hong Kong.

As for the former kind, pursuant to O.11 r.5(2), such order or direction of the Court in Hong Kong must not contravene PRC law. If a particular mode of service was preferred by the relevant judicial authorities on the Mainland, the applicant must follow the same in his request with the Registry of the High Court. The applicant has to prove to both the Court in Hong Kong and a Higher People’s court on the Mainland that his proposed service method was appropriate.

The Court then justified the latter kind of substituted service. In reality, in most cross-border disputes, the parties would submit to the jurisdiction of the court or there is a substantial connection between the dispute and Hong Kong. Therefore, allowing substituted service is a pragmatic decision in the interests of efficient litigation. As a safeguard, the Court would also ensure the method of substituted service in Hong Kong would not authorise any conduct contrary to PRC law.

Implication

Apparently, the Court is prepared to take a pragmatic approach as far as service out of the jurisdiction is concerned. Acknowledging there being practical difficulties in serving out of the jurisdiction on a Mainland Chinese resident, the Court may go so far as to allow substituted service in Hong Kong, as opposed to that effected in China, when the Plaintiff can prove that such substituted service could make known to the Defendant the existence of the writ in all reasonable probability.

On 23 September 2016, Senior Associate Mr. Franky Fung together with our Banking Department Legal Executive, Mr. Man Wong attended the grand opening ceremony and banquet of Vpower Finance Security (HK) Limited (“the Company”).

The Company founded by Shenzhen Vpower Finance Security Company Limited (“Shenzhen Vpower”), is the first pilot professional finance security company designated by the head office of The People’s Bank of China. Shenzhen Vpower provides multifarious finance security services, ranging from cash convoy operations to vault security services. With the total asset value reaching over RMB 200 million as of today, Shenzhen Vpower continues to provide finance security covering all banking branches in Shenzhen. As the Hong Kong office of Shenzhen Vpower, the Company enjoys the advantage of tapping into the success of Shenzhen Vpower in terms of its business model.

Stevenson, Wong & Co. takes pride in being entrusted as their legal advisor and assist in the establishment of their office in Hong Kong.

For more enquiries about this event, please contact our Mr. Eric Lui.

(中文) 家族信托消灭“分家”纠结（2）
(原载于财富管理杂志2016年6月刊)

(续前文)
晚育，再婚，晚婚，老夫少妻家庭里，要不要二胎是个共同痛点。二胎大大增加了继承安排与执行的难度！

财产分配与继承难题
孩子在很多国家都是继承第一顺位人。所以父母辈的公司股权，房产，现金等有形无形的资产都需要平均分配。先不要提遗产继承公证费（资产规模的1-2%）或遗产税税金（资产规模的50%左右）缺位导致放弃继承的情况。

在中国的继承流程中，主要关联人因为各种原因，例如孩子在国外考试，父母行动不便身体不适，妻子不满意分配方案，子女不能接受突然冒出的兄弟姐妹等不出席继承权公证会议，继承流程就比较难走下去。如果老大本来就不喜欢老二，此时就成为最佳报复时机。

假如家里拥有在北京三环，五环的房子各一套；分割时应该是每套房子一人一半，还是每人一套房子已经折腾了很多家庭。有些孩子在国外生活，不希望继承父辈在国内的房产或企业：兄弟间协商资产定价时，是另外一个难点。继承资产方如何拿出现金先行清算也可能受不同国家继承流程的约束。

弄不好就是亲人们互相告上法庭，香港的镛记烧鹅不就是这类故事的加长版，二代已经继承了家业很久了，兄弟股东间的纠纷导致家族企业消散。

继承人之间如果存在监护关系时，利益冲突在日后生活里会愈来愈明显。成绩优秀的老二被外国大学录取，需要使用遗产支付海外高额的学费及生活费。老大是希望老二留在国内读公立大学还是拿到奖学金才能出国？游学最好免了，生活中奢侈品消费等最好也减少。 长兄为父，严父难当，这一切是为了锻炼小弟弟还是不想资产被稀释？

当老二的生活需求长期无法得到满足，小孩子心里难受。到了叛逆期，后果更加不堪设想，家庭矛盾的种子由此种下。

家族信托彻底消灭“分家”的纠结
在以前，成家的兄弟以分家各过各，女儿靠边站的方式继承父辈资产。时代变了，继承方式也发生了变化。分家的纠结还在于，用什么方式让孩子得到继承。这几年，信托成了最多的选择。

原本计划给大女儿，二女儿的抚养费，剥离在独立家族信托里，受到成立人订立的受益条款约束，法律支持信托公司专款专用，不被监护/抚养人婚姻，债务问题等影响。孩子们的权益有了保护，各人心里也就踏实了。信托公司按照成立人的约定，应付孩子们的教育，医疗，结婚，创业，生育，生活等支出；减少家人，监护人，抚养人，利益关系人间的利益冲突，专业第三方的参与有效缓冲家庭矛盾。

资产以家族信托持有的更大意义是可以避免继承流程，彻底消灭继承流程时所需文件不全；后代没法交付例如继承公证费，印花税，契税，增值税，遗产税等导致放弃继承的风险。同时彻底消灭“本金”分配安排的纠结：家人都没有股权，有能力接班的也只有管理权，没有能力时罢免其职务；房子按需求也只有使用权（如家庭成员数字，居住地，学区要求等）；大家按情况都享有生活费，这样可以避免很多正面冲突。

每个家庭结构都会影响信托最终设计。设立信托时与其家人充分沟通，了解他们的想法需求，包括各人的能力与担忧；在未来不可预见的身体状况下，与家族办公室测试不同分配方案的现金支出可行性。尽可能绕开不同国家婚姻法，税法，继承法的影响，最大程度减低万一出现不可预知的冲突时对资产耗损，家人生活的影响。

可怜天下父母心，对孩子负责，是每一对父母要用行动去做到的。

如想了解更详细的海外信托对资产保护或继承安排的功能，请联系你的法律顾问/理财顾问/家族办公室。史蒂文生黄律师事务所成立了香港及新西兰信托公司，可为客户提供信托咨询或受托人服务。 最近还获得香港家族办公室协会颁发“最具特色家族海外信托策划服务奖”

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Company A, incorporated in Canada, held 75% of three operating companies in the business of mineral mining while Company B held the remaining 25%. Company A as guarantor entered into a borrowing facility with certain companies as borrowers. Company A also charged some shares in two companies in favour of the lender bank.

Company A went into financial difficulties. Subsequently, the lenders rights were transferred to Company C (within the same group of companies as Company B). A notice of acceleration was served on the borrowers. The initial security agent also resigned and was replaced by Madison, a Hong Kong company. As the matter went on, the discussions to resolve the financial difficulties failed and joint administrators were appointed by the High Court in London.

The administrators were concerned that Madison would sell the charged shares at an undervalue which will prejudice the equity of redemption. An application was made in London (the centre of main interests of Company A) and in Hong Kong in an attempt to stall the sale of the charged shares.

Court’s decision

The Court first considered the issue whether liquidators appointed in a jurisdiction (England in this case) other than the place of incorporation (Canada in this case) are recognised under Hong Kong law. The court supports (without deciding) the idea of recognising such liquidators and thus having the jurisdiction to render active assistance to overseas insolvency proceedings due to the commercial necessity of cross border insolvency.

The second issue is, in the lack of the statutory provisions, what types of orders are available to such liquidators under common law and equitable principles. The Court found that there were no statutory provisions which provided for a moratorium of the enforcement of the security. In the instant case, the application was not made on the ground that the proposed enforcement would prejudice the equity of redemption or the liquidated company subsequently had been able to fulfill the payment obligations. Hence, the application had no common law or equitable basis to rest on. On this basis, the court rejected the application.

Implications

The present case reflects the natural spread of modified universalism in cross-border insolvency cases, under which the court will endeavour to provide assistance to each other without awaiting sanctions as agreed by international conventions. Although liquidators not appointed in the place of the incorporation are recognised, the court still treads cautiously when it comes to granting restrictive sanctions to aid foreign insolvency proceedings.