News
News //
Submitted by // H Rogers, COO
10 June 2019

Howse Williams is delighted to announce that Kevin So has joined the firm as a Partner in the dispute resolution practice.

Kevin joins the firm from Davis Polk & Wardwell in Hong Kong. Kevin advises on a wide range of complex commercial litigation matters. He has extensive experience in civil and commercial disputes including banking, company, insolvency, trusts and estates and real estate matters. Kevin also advises on regulatory matters including criminal prosecutions and investigations by regulators and authorities including the Securities and Futures Commission, the Commercial Crime Bureau and the Independent Commission Against Corruption. Kevin’s clients include banks, large corporations and ultra high net-worth individuals both in Hong Kong and the PRC.

Kevin was named as the Rising Star of the Year at the Asialaw and Benchmark Litigation Asia-Pacific Dispute Resolution Awards 2018. He has also been named as a Future Star (Commercial and Transactions) by Benchmark Litigation Asia-Pacific in 2018 and 2019.

Chris Howse, the Senior Partner and a founding partner of Howse Williams commented “We are delighted to welcome Kevin So to the partnership. Kevin is an experienced litigator and a great fit for Howse Williams’ dispute resolution practice.”

With the addition of Kevin So, Howse Williams has 27 Partners, 5 Consultants and a total headcount of approximately 200.


Kevin So
Partner

T +852 2803 3688
D +852 2803 3602
F +852 2803 3608
E kevin.so@howsewilliams.com

About Us

Howse Williams is an independent law firm which combines the in-depth experience of its lawyers with a forward thinking approach. 

Our key practice areas are corporate/commercial and corporate finance; commercial and maritime dispute resolution; clinical negligence and healthcare; insurance, personal injury and professional indemnity insurance; employment; family and matrimonial; property and building management; banking; fraud; financial services/corporate regulatory and compliance.

As an independent law firm, we are able to minimise legal and commercial conflicts of interest and act for clients in every industry sector. The partners have spent the majority of their careers in Hong Kong and have a detailed understanding of international business and business in Asia.

 

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Submitted by // P Yeung, Partner
21 January 2019

 

The Labour Tribunal's Power to Order a Claimant to Provide a Security Payment - a speed bump for parties with weak claims or who abuse the process

Hon Sau Har v. Lo Woon Bor Henry T/A Henry Lo & Co Solicitors, [2018] HKCU 3914

Introduction

Since 2014, the Labour Tribunal has had the power to order parties to provide security for awards or orders (see section 30(1) of the Labour Tribunal Ordinance). The grounds for making such an order are relatively broad and give the Labour Tribunal considerable discretion, including making an order for security for a party's costs.

There has been little case law on how this discretion should be exercised. In a 2015 case, an employee was ordered to pay security for payment of an award essentially because he had abused the process (see Lam Che Fu v The Chinese Kitchen (Sai Kung) Ltd). Clearly, the making of such an order against an employee can have a drastic effect on their ability to pursue their claim. A recent decision of the Court of First Instance, Hon Sau Har v. Lo Woon Bor Henry T/A Henry Lo & Co Solicitors, [2018] HKCU 3914, shed some further light on this area of law. This alert provides a summary of the case and highlights the principles which are to be considered in granting an order for security for payment of an award or order in a Labour Tribunal case.

Background facts

The Claimant was a secretary employed by the Defendant, which is a law firm. She worked for the Defendant for less than 2 years and was dismissed by the Defendant with one month's payment in lieu of notice.

The Claimant claimed for annual bonus, pro-rata payment for unused annual leave and termination payments. The Defendant argued that:

(1) annual bonus was discretionary depending on the financial situation of the law firm according to the employment agreement;

(2) the pro-rata payment for unused annual leaves should only be payable in the event that the Claimant had worked for more than 3 months in the year she was dismissed; and

(3) the termination payments should only be granted where the employee has been employed for a period of not less than 24 months, according to law.

In the call-over hearing before the Labour Tribunal, the Presiding Officer explained to the Claimant that both the Labour Department and the Labour Tribunal officer had informed her all her claims lacked merit. The Claimant insisted on pursuing her claims, so the Defendant applied for an order for payment of security for costs.

The Presiding Officer made an order for payment of security for costs against the Claimant on the basis that "the Claimant could not demonstrate that she has a high degree of probability of success at trial". The Claimant did not make the security payment and the Presiding Officer ordered her claims against the Defendant to be dismissed. The Claimant appealed against the orders to the Court of First Instance.

The Court of First Instance decision

In the Court of First Instance, Deputy High Court Judge Marlene Ng (as she then was) had to consider whether the order or determination by the Tribunal was (a) erroneous in point of law or (b) outside the jurisdiction of the Tribunal.

The Claimant argued that she had a low income and therefore it would be unfair to impose a security payment order against her. The Court considered whether there were any balancing factors which meant that a security payment order should not be imposed on the Claimant. Such balancing factors included considering whether the Claimant had a strong and valid claim.

The Court took the view that the Presiding Officer had not erred in point of law and agreed that the Claimant's claims lacked merit. Briefly, the Court's reasoning is as follows:

(1) The Claimant clearly had not been employed under a continuous contract for a period of no less than 24 months. Therefore, her claim for terminal payments was groundless. The Claimant was aware of this as she said she intended to drop this claim.

(2) In relation to the Claimant's claim for annual bonus, the Claimant did not dispute that the bonus provision was discretionary and binding. Accordingly, the Court agreed with the Presiding Officer's view that the Claimant was unlikely to succeed in her argument that the provision should be interpreted in her favour.

(3) As regards the claim for annual leave payments, the Claimant did not satisfy the requirement of working for more than 3 months in the year she was dismissed. This claim clearly lacked merit.

The Court also considered the Claimant's income level and financial situation, which posed a risk that she may not be able to compensate the Defendant's costs in the event that she was not successful in her claims. Meanwhile, the Defendant may also have to incur additional costs in seeking to execute any costs order, which would be unfair to the Defendant. Therefore, an order for security for costs was "just and expedient" in this case.

Takeaway points

In considering whether an order for security for payment of an award or order should be made, the Tribunal would consider the following:

(1) whether the claimant has sufficient financial means to pay for the defendant's costs if the claimant fails to prove his/her claim;

(2) whether the claimant has strong merits in his/her case; and

(3) if it cannot be determined that the claimant has a reasonable chance of success in his/her claim, whether there are any balancing factors which militate against an order for security being made.

When deciding on the amount of the security payment, the Tribunal will take into consideration the defendant representative's income and the amount of time expected to be spent on the case by such defendant representative.

The Presiding Officers have indicated a willingness to invoke this power in cases where they consider that employees are pursuing weak or meritless claims. It should not be forgotten that the Labour Tribunal can also make such orders against employers.
 


About Us

Howse Williams Bowers is an independent law firm which combines the in-depth experience of its lawyers with a forward thinking approach.

Our key practice areas are corporate/commercial and corporate finance; commercial and maritime dispute resolution; clinical negligence and healthcare; insurance, personal injury and professional indemnity insurance; employment; family and matrimonial; property and building management; banking; fraud; financial services/corporate regulatory and compliance.

As an independent law firm we are able to minimise legal and commercial conflicts of interest and act for clients in every industry sector. The partners have spent the majority of their careers in Hong Kong and have a detailed understanding of international business and business in Asia.

Disclaimer: The information contained in this article is intended to be a general guide only and is not intended to provide legal advice.  Please contact pr@hwbhk.com if you have any questions about the article.

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Submitted by // P Yeung, Partner
07 November 2018

 

Preventing discrimination versus upholding the status of marriage

Introduction

Article 37 of the Hong Kong Basic Law states that "The freedom of marriage of Hong Kong residents and their right to raise a family freely shall be protected by law." This protection is understood to be limited to marriage between heterosexual monogamous couples. This has led to a debate on equality of treatment of homosexual couples in the context of rights and privileges borne out of marriage. The principal issue is that treating same-sex relationships differently to heterosexual relationships is discriminatory.

The recent case of Leung Chun Kwong v Secretary for the Civil Service and Another [2018] HKCU 1802, the Court of Appeal dealt with this difficult issue.

Background

The case involved an applicant, a Senior Immigration Officer. The applicant had married his same-sex partner in New Zealand. Upon returning to Hong Kong, he claimed spousal benefits available to civil servants.

The Secretary for Civil Service, however, took the view that the applicant's same-sex marriage was not a marriage within the meaning of Hong Kong law and accordingly, spousal medical and dental benefits offered to civil servants did not extend to the applicant's partner ("Benefits Decision").

Similarly, the Commissioner of Inland Revenue informed the applicant that he was not entitled to elect for joint assessment with his partner because their same-sex marriage did not fall within the meaning of marriage in the Inland Revenue Ordinance ("Tax Decision").

Court of First Instance Decision

In the first instance decision, Justice Chow held that the Benefits Decision unlawfully discriminated against the applicant by reason of his sexual orientation as there was a difference in treatment accorded to the applicant on account of his same-sex marriage. On the other hand, Justice Chow held that the Tax Decision was correct in that the Commissioner had based his decision on the provisions of the Inland Revenue Ordinance.

Court of Appeal Decision

The Secretary for Civil Service appealed the Benefits Decision and the applicant cross-appealed the Tax Decision. The central issue arising from the appeal was whether the Benefits Decision and/or Tax Decision constituted discrimination against the applicant on account of his sexual orientation.

In making its determination, the Court of Appeal applied the test established in the recent Court of Appeal case of QT v Director of Immigration [2017] 5 HKLRD 166 (a case which was subsequently appealed to the Court of Final Appeal, although that appeal had not been decided when Leung Chun Kwong was heard by the Court of Appeal).

According to the Court of Appeal decision in the QT case, if a benefit is a core right or obligation unique to marriage, no justification is required for its lawfulness. Where the differential treatment falls outside such core rights, and if the reason for the difference is, for example, sexual orientation, the right to equality is engaged and there must be a justification for the differential treatment. If, however, after evaluating all the circumstances, the court has a doubt as to whether the relevant right or obligation is a core right or obligation or not, the court must act cautiously by proceeding to consider justification.

The Court of Appeal in Leung Chun Kwong found that there is a strong case for saying that spousal benefits (as contractual employment benefits) are not a core right as they cannot be said to be unique to marriage by their nature. They are simply part of a contractual remuneration package and no more. However, the court said that the issue was not plain and obvious, and it would therefore be cautious and apply the justification test. The right to elect for joint assessment, however, was found to be a core right unique to marriage as it flowed from the special status of marriage. The justification test was therefore required.

Applying the justification test to both decisions, the Court of Appeal found that upholding the status of marriage was a "sufficient and indeed very weighty justification for both the Benefits Decision and the Tax Decision".

Accordingly, the court held that there was no discrimination against the applicant on account of his sexual orientation.

Looking forward

The deprival of spousal benefits to a same-sex couple was held not to be discriminatory in this case, and differential behaviour in this regard was held to be justified by the need to protect and not undermine the status of marriage.

In determining the appeal in the QT case, the Court of Final Appeal held that the justification test as established in the Court of Appeal (and as used in this case) should not be followed and that the correct approach is to examine every alleged case of discrimination to see if the difference in treatment can be justified. The Court of Final Appeal decision means QT is a landmark case, which will affect how future cases on discrimination are decided and which potentially paves the way for changes in the treatment of same-sex relationships in Hong Kong.
 


About Us

Howse Williams Bowers is an independent law firm which combines the in-depth experience of its lawyers with a forward thinking approach.

Our key practice areas are corporate/commercial and corporate finance; commercial and maritime dispute resolution; clinical negligence and healthcare; insurance, personal injury and professional indemnity insurance; employment; family and matrimonial; property and building management; banking; fraud; financial services/corporate regulatory and compliance.

As an independent law firm we are able to minimise legal and commercial conflicts of interest and act for clients in every industry sector. The partners have spent the majority of their careers in Hong Kong and have a detailed understanding of international business and business in Asia.

Disclaimer: The information contained in this article is intended to be a general guide only and is not intended to provide legal advice.  Please contact pr@hwbhk.com if you have any questions about the article.

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Submitted by // K Bowers, Partner / Solicitor Advocate
22 August 2018


Ng Po Yu and Another v Lam Kai On [2018] HKCU 2335

Introduction

This is a case involving a family dispute over the ownership of a house ("House") which was left by the deceased ("Mother"), who had 3 sons from a previous marriage and a daughter, the 1st Plaintiff, from her second marriage to Mr. Ng ("Father"). The Mother left the House to her 3 sons (one of which was the Defendant) in a will.

In 1982, the Mother and Father ("Parents") set up a fabric wholesale business called Shun Lee Trading Co ("Shun Lee"), and held equal shares in Shun Lee as partners. Over the years, the Parents bought 6 properties held in either the sole name of the Father or the Mother.

During the 1990s, the 1st Plaintiff gave up her job to help the Parents with the running of Shun Lee. Among other transactions involving the Parents' properties, a mortgage was created over the House in May 1996 to secure banking facilities for Shun Lee. Over the years, multiple facilities and loans were taken out by the Father, the 1st Plaintiff, and Shun Lee. The House eventually became the only property left in the family.

After the Mother died during May 2012, the 1st Plaintiff applied for letters of administration. She then discovered the Mother's will.

Parties' respective cases

The 1st Plaintiff's case was three-fold:

- there was a general promise by the Parents which led to the 1st Plaintiff leaving her job to (i) help run the family business (ii) repay the mortgage, and (iii) maintain the Parents ("3 Conditions");

- the Mother had asked the 1st Plaintiff to perform the 3 Conditions on the express understanding that the House would be left to the 1st Plaintiff; and

- there was a common intention constructive trust which arose after the 1st Plaintiff assumed liability for repaying the mortgage on the House in return for the Mother's agreement to leave her the interest in the House.

The Defendant pointed out that the ownership of the House was in the Mother's sole name, and asserted that he had also helped run (for no pay) the Mother's business between 1970 – 1980 and that the bank loans were taken out wholly or partly for the personal use of the Father and the 1st Plaintiff. The Defendant also claimed that the 1st Plaintiff had provided maintenance and had repaid the mortgage on the House in discharge of her filial duties, and not in exchange for the House.

Findings

In assessing whether a constructive trust had been created, the starting point is that beneficial interest follows the legal title. The burden of proof in establishing that there was a constructive trust fell on the 1st Plaintiff. The principles for a common intention constructive trust are that there must be:-

a) a common intention between the parties that one party was to be the beneficial owner of a property despite the fact that the property was acquired in another's name;

b) the claiming party had altered its position in detrimental reliance upon such a common intention; and

c) it is therefore unconscionable for the legal owner to assert ownership in reliance on his/her legal title to the property.

In relation to the 1st Plaintiff leaving her job to perform the 3 Conditions, the Court found that the 1st Plaintiff had received significant benefits at the beginning of her career working for the family business. In evidence, the 1st Plaintiff also stated that she had acquired shares in some of the family business. As such, she had suffered no real detriment. The Court did not find any incentive on the part of the Parents to make a general promise. Without any concrete evidence of intention, the Court found that the facts and evidence did not support the 1st Plaintiff's case.

It is worth pointing out however that although the 1st Plaintiff's case in constructive trust failed, the Court found that the 1st Plaintiff's money was the source of the repayment of the mortgage on the House and that these repayments had not been made out of filial duties. As such, the Court held that the Mother's estate should reimburse 3/4 of the mortgage repayments made by the 1st Plaintiff. The monetary judgment for repayment was charged on the House until full payment by the Mother's estate.

Comment

It is important for family members to ensure that interests in property and other family-owned assets are recorded in writing (and preferably witnessed), so that there is 'hard' documentary evidence of any conflicting interests to prefer any family member over another – the alternative (in disputed cases) is an expensive, long-drawn out court process which can (and does) cause permanent damage to family relationships.


About Us

Howse Williams Bowers is an independent law firm which combines the in-depth experience of its lawyers with a forward thinking approach.

Our key practice areas are corporate/commercial and corporate finance; commercial and maritime dispute resolution; clinical negligence and healthcare; insurance, personal injury and professional indemnity insurance; employment; family and matrimonial; property and building management; banking; financial services/corporate regulatory and compliance.

As an independent law firm we are able to minimise legal and commercial conflicts of interest and act for clients in every industry sector. The partners have spent the majority of their careers in Hong Kong and have a detailed understanding of international business and business in Asia.

Disclaimer: The information contained in this article is intended to be a general guide only and is not intended to provide legal advice.  Please contact pr@hwbhk.com if you have any questions about the article.

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