The Arrangement on Mutual Taking of Evidence in Civil and Commercial Matters between the Courts of the Mainland and Hong Kong (Arrangement) recently came into force on 1 March 2017, announced by the Department of Justice. The Arrangement is introduced to offer greater certainty and enhanced efficiency for obtaining of evidence between the Mainland and the HKSAR for civil and commercial cases.
Julian Copeman, May Tai and Anita Phillips discuss their client research and the outputs of the recent Global Pound Conference to assess what is required to bring mediation into the mainstream for commercial parties in Hong Kong. Click here to access their article in Asian Dispute Review, which was published on 3 April 2017.
In the first instance decision of Fo Shan Shi Shun De Qu Consonancy Investment Co Ltd v Yat Kit Jong  HKEC 557, the Court took a dim view of a party's conduct in respect of expert directions. It held that the party's failure to properly define the scope of the issues to be covered by the expert was a violation of procedural rules and prejudicial to the opposing party, and as such ordered that the party be penalised on costs.
The Court of First Instance in Hong Kong has held that the six year limitation period specified in section 4(2) of the Limitation Ordinance (Cap.347) (LO) applies, by analogy, to an equitable claim by a company against its director(s) for accounts of company assets which have come into the hands of the director(s). This is important because otherwise there would be no specific limitation period and the general equitable principle of "laches" would apply.
The Hong Kong Court has recently ordered the removal of an administratrix, who was the widow of the deceased, after finding she had misappropriated and converted the estate to her own use, repeatedly breached Court orders and had failed to render a proper and accurate account. This case is a reminder to all administrators to fulfil their duties or face removal.
The Nanjing Intermediate People's Court in Jiangsu Province, China ("Nanjing Court") recently issued a ruling recognising and enforcing a default judgment granted by the High Court of Singapore ("Singapore Judgment") based on the reciprocity principle.
Although permitted under the PRC Civil Procedure Law, PRC courts have rarely, if ever, recognised and enforced foreign judgments on the reciprocity principle. While it is still too early to predict whether the ruling will see wider application, it is a positive attempt towards applying the reciprocity principle in the context of recognising and enforcing foreign judgments in China.
The Court of Final Appeal has handed down an important judgment regarding bribery charges against former TVB general manager and TV presenter, Stephen Chan and his assistant, Tseng Pei-kun. In a case spanning seven years, Chan and Tseng were twice acquitted at first instance but found guilty of bribery by the Court of Appeal in November 2015. Tseng was found by the Court of Appeal to have offered, and Chan to have accepted, an unlawful advantage under section 9 of the Prevention of Bribery Ordinance (POBO), which governs bribery between private sector actors in Hong Kong.
In a detailed judgment dated 14 March 2017, the Court of Final Appeal unanimously reversed the Court of Appeal's decision, with the majority ruling that Chan was not acting “in relation to his principal (TVB)'s affairs or business" when accepting the advantage. As such, his conduct fell outside the purview of section 9 of the POBO. The judgment provides important clarification on the scope of Hong Kong's private sector bribery offence, in particular, what it means to act "in relation to a principal's affairs or business". With the Court of Final Appeal in January addressing the meaning of "acting for another" under section 9 of the POBO, the scope of the private sector offence has seen important clarifications in recent months.
Wills interpreted according to their ordinary and natural meaning despite this not reflecting testators’ intention
The English High Court has recently held that, in a case concerning construction of Wills, the ordinary and natural meaning of survivorship clauses should be given effect to. This operated to mean that certain beneficiaries under the Wills of a husband and wife benefitted twice, which the parties agreed was not the couple's intention. The claimants were the executrices of the couple's estates (and also beneficiaries of the estates). They wished to know how to distribute the estates. The claimants wanted the Court to interpret the Wills in accordance with the couple's intention. This would have meant that they received less under the Wills than they would have done if the Wills were interpreted in their ordinary and natural terms. The defendants were the solicitor who drafted the Wills and his firm.
The case is a reminder to executors of the importance of administering estates in accordance with the terms of the Wills. The case is also a reminder to draftsmen of the importance to accurately convey a testator's intention when drafting a Will.
The third edition of our ADR in Asia Pacific Guide spotlights alternative dispute resolution (ADR) in Indonesia.
We summarise the state of play in relation to ADR in Indonesia and its interplay with adversarial processes like litigation and arbitration. We delve into the detail of the Supreme Court's new mediation regulation and decree and analyse how these hope to improve rates of settlement. We then look at some practical aspects of mediation and dispute resolution from a lawyer's perspective, highlighting the often novel way in which mediation is deployed in Indonesia. Finally, we summarise the ground-breaking Global Pound Conference (GPC) series which looks at all dispute resolution processes and how these can be improved for commercial parties. Herbert Smith Freehills is proud to be global founding sponsor of GPC.
To download your copy, please click here.
The Securities and Futures Commission (SFC) in Hong Kong has recently sought disqualification orders against listed company directors in a number of court actions commenced in the past few months. The proceedings against the directors have been brought under section 214 of the Securities and Futures Ordinance. If successful, the court has the power to disqualify the relevant directors from being directors or from being involved, directly or indirectly, in the management of any corporation for up to 15 years. The SFC is also seeking compensation orders from certain directors in some cases.
There have also been a number of regulatory developments emphasising the role of boards of directors and senior management. These, together with the recent enforcement actions, highlight the increased focus on directors. In light of this, all directors, including non-executive directors, must ensure that they fully understand the regulatory framework and are able to properly discharge their responsibilities.