Our associate Mr. Gordon Tsang and Head of Business Development Ms. Connie Yeung presented a seminar on Family Trust Laws at the head office of Prudential Hong Kong Limited on 12th of July 2016. They explained how to protect assets through the establishment of family trusts and the benefits of such arrangements with reference to their related legal issues.

The seminar was well received and participants found the sharing both interesting and practical.

Please contact Ms. Connie Yeung for any enquiries or further information about this event.

We are pleased to announce that, our partner, Mr. Eric Lui, has been appointed as a mediator of the Shenzhen Qianhai Co-operation Zone People’s Court in May 2016 for a term of three years. The appointment was followed by the opening of the Court-Connected Mediation Centre of the Shenzhen Qianhai Co-operation Zone People’s Court. The establishment of the mediation centre will enhance the quality and efficiency of mediation services in Hong Kong and Shenzhen in cases which involve Hong Kong parties. It will also support Hong Kong in seeking further co-operation with coastal provinces and cities, and the joint exploration of the Belt & Road initiative.

Please contact our Mr. Eric Lui for any enquiries or further information about this news.

SW acted as legal advisers to Orient Securities Company Limited (Stock Code: 03958) (“DFZQ”) to list on the Main Board of The Stock Exchange of Hong Kong Limited (“The Stock Exchange”).

The shares were listed on The Stock Exchange on 8 July 2016. 957 million shares were offered, among which 885 million were offered for international offering. The final offer price was HK$8.15 per offer share and the net proceeds amounted to approximately HK$7.79billion.

DFZQ is a leading and fast-growing capital markets service provider in China and according to Wind Information Co. Ltd., ranked 10th by total assets among PRC securities firms.

Please contact our Mr. Hank Lo for any enquiries or further information about this transaction.

From 7th July 2016 to 9th July 2016, our partner Mr. Eric Lui attended the 3rd session of the first ever Association of Family Offices in Hong Kong’s professional and regional development conference in Qing Dao in his capacity as a vice president of the professional member committee.

With the rapid development of the Chinese economy, HKFOA was registered in Hong Kong on 20th June 2014 by institutions for family wealth management, experts, professionals and scholars from the PRC, Hong Kong and Taiwan to focus on the Cross-Strait economic, social and cultural exchange and integration with a view to acting as a bridge between Government, Market and Customers. It not only gives advice for innovative family wealth management and development, but also provides a platform for private enterprises to enhance its competitiveness and quality through forums and workshops for business management and compliance.

In addition to the discussion of the development and sustainability of the group, a wide spectrum of case study and analysis were conducted during the conference such as cross-border tax planning, family wealth protection, global citizenship, family charity and trust, planning on succession and perpetuity of enterprise and family business.

Please contact our Mr. Eric Lui for any enquiries or further information about this event.

In Zimmer Sweden AB v KPN Hong Kong Ltd and another (CACV 172/2015), the Court of Appeal affirmed the wider meaning of the “fraud exception” to be applied in applications for summary judgment in Hong Kong.

Fact
The plaintiff alleged that it was a victim in a cyber fraud in which it was deceived to transfer funds to the Lithuanian bank account which were subsequently remitted to bank accounts in Hong Kong of the 1st and 2nd defendants.

The plaintiff in its statement of claim argued that the fund transfer was effected as a result of fraudulent misrepresentation and/or mistake as to the recipient’s identity.

In their defence, the defendants contended that the funds received were due to “normal and ordinary business transaction” so they were “bona fide purchasers and/or have changed their position in good faith”.

In reply, the plaintiff challenged the authenticity of the facts relied on by the defendants in support of their defence.

At Trial
At trial, the trial judge dismissed the plaintiff’s application for summary judgment because the plaintiff’s claim was caught by the fraud exception.

The plaintiff appealed the trial judge’s decision to the Court of Appeal.

Appeal
The Court of Appeal agreed with the trial judge’s finding that the Plaintiff, in its pleadings, in effect raised allegations against the defendants that they were party to a fraud. The appeal was dismissed accordingly.

Implications
This case affirms Hong Kong courts’ wide application of the “fraud exception” in summary judgment applications.

However, in a similar case Universal Capital Bank v Hongkong Heya Co Ltd (HCA 1211/2015), Zimmer Sweden was distinguished and it was held that the fraud exception did not apply to bar the application for summary judgment. In this case, a cyber fraud alleged occurred resulting in financial losses suffered by the plaintiff. The funds were subsequently transferred to a Hong Kong bank account of the defendant and were eventually transferred to a third party in PRC. It was held that the plaintiff’s claim was based on the defendant’s unjust enrichment but not allegation of fraud against the defendant. The plaintiff’s application for summary judgment is not barred and a conditional leave to defend order was granted to the defendant.

Based on our experience in handling cases involving cyber fraud and the above two cases, victims of cyber fraud who would like to obtain summary judgment to claim for restitution are advised to be careful when preparing pleadings so that no allegation of fraud against a defendant is made.

Our partner, Mr Eric Lui, acted as a judge in the general rounds of the International ADR Mooting Competition 2016 which took place from 5 to 9 July 2016. City University of Hong Kong (CityU) was the host for this year’s competition.

The Competition is an initiative between the China International Economic and Trade Arbitration Commission and the School of Law of CityU, in association with UNCITRAL Regional Centre for Asia and the Pacific and Curtin Law School. It comprises both mediation and arbitration, offering students from all parts of the world an opportunity to get a taste of the experience of being arbitrators and mediators.

Dean of the School of Law of CityU, Prof. Geraint Howells and Moot Director, Dr Mark Kielsgard, expressed their gratitude for Mr Lui’s support for and involvement in the Competition.

Please contact our Mr Eric Lui for any enquiries or further information about this event.