NATALIE W CHEN v. WONG SIU LING AND ANOTHER

NATALIE W CHEN v. WONG SIU LING AND ANOTHER

The court held that, on the evidence (the memorandum of wishes and the trustees' consistent conduct), the settlor intended the settlement to operate as a fixed settlement in accordance with his will rather than a discretionary trust; although the trustees breached fiduciary duties by failing to isolate trust interests from family redevelopment plans and by lack of transparency, their misconduct did not amount to dishonesty and did not justify removal because there was no continuing risk to the trust and removal would impose unnecessary cost; the plaintiff was entitled to a declaration that the trust property is held on the terms of the settlement as modified by the memorandum of wishes...

Citation
NATALIE W CHEN v. WONG SIU LING AND ANOTHER
Parties
Plaintiff: Natalie W Chen; 1st Defendant: Wong Siu Ling; 2nd Defendant: Wong Wan Chiu, Ignatius
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
7 November 2000
Case Number
HCMP3943/1997
Procedural Posture
Trust and Probate Litigation Under Trustee Ordinance (cap.29) Concerning Settlement and Estate Duty / Court of First Instance — Judgment Handed Down
Outcome
Declaration granted that defendants hold the trust property and income on the terms of the settlement deed as modified by the memorandum of wishes; trustees not removed; plaintiff awarded costs to be paid by defendants personally; defendants may not look to the trust for their costs; liberty to apply for further...
Legal Topics
Discretionary Vs Fixed Trust, Memorandum of Wishes, Ramsay Principle (tax Avoidance), Removal of Trustees, Conflict of Interest, Breach of Trust, Costs Against Trustees
Source Language
EN
Trusts Law Probate and Estate Duty Fiduciary Obligations Property Law Tax Avoidance Discretionary Vs Fixed Trust Memorandum of Wishes Ramsay Principle (tax Avoidance) +4 more

Case Brief

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Parties

Natalie W Chen

Plaintiff

Wong Siu Ling

1st Defendant

Wong Wan Chiu, Ignatius

2nd Defendant

Procedural Posture

Trust and Probate Litigation Under Trustee Ordinance (cap.29) Concerning Settlement and Estate Duty / Court of First Instance — Judgment Handed Down

Legal Issues

  1. 1 Whether the 1985 settlement was a discretionary trust or effectively a fixed trust governed by the testator's will
  2. 2 Whether the trustees breached fiduciary duties by failing to apply for probate/estate duty clearance and by using trust assets to support Barker Road redevelopment
  3. 3 Whether the trustees should be removed

Ratio Decidendi

The court held that, on the evidence (the memorandum of wishes and the trustees' consistent conduct), the settlor intended the settlement to operate as a fixed settlement in accordance with his will rather than a discretionary trust; although the trustees breached fiduciary duties by failing to isolate trust interests from family redevelopment plans and by lack of transparency, their misconduct did not amount to dishonesty and did not justify removal because there was no continuing risk to the trust and removal would impose unnecessary cost; the plaintiff was entitled to a declaration that the trust property is held on the terms of the settlement as modified by the memorandum of wishes...

Court Disposition

Declaration granted that defendants hold the trust property and income on the terms of the settlement deed as modified by the memorandum of wishes; trustees not removed; plaintiff awarded costs to be paid by defendants personally; defendants may not look to the trust for their costs; liberty to apply for further...

Orders

  • Declaration that defendants hold the trust property and income on the terms of the settlement deed as modified by the memorandum of wishes
  • No order for removal or replacement of the trustees