Hong Kong Case Law: Decisions & Judgments

Topic

Constructive trustee

Legal area

Court

7 Feb 2018

LIU HSIAO CHENG v. WONG SHU WAI AND OTHERS

Citation

[2018] HKCA 58
Court

Court of Appeal
Case number

CACV92/2017

The Court of Appeal concluded paragraph 125 pleads a claim for an account simpliciter grounded in a fiduciary/de facto director relationship; consequently the 6-year limitation period in s4(2) does not apply by analogy and no provision of the Limitation Ordinance plainly bars the account claim. The strike-out of remittances prior to 12 July 2007 was therefore incorrect and is set aside.
11 Feb 2014

TIMMERTON COMPANY INC v. EQUITY TRUSTEE LTD AND ANOTHER

Citation

TIMMERTON COMPANY INC v. EQUITY TRUSTEE LTD AND ANOTHER
Court

Court of First Instance
Case number

HCA2167/2012

The court held that the plaintiff has demonstrated a good arguable case and a serious issue to be tried that the defendants received trust assets with knowledge amounting to knowing receipt/constructive trust, and given the uncertainty in the law on the scope of limitation defences under section 20, the defendants failed to show there is no serious issue to be tried; therefore the application to set aside the leave to serve out is dismissed.
16 Oct 2012

TELE-ART INC. (IN LIQUIDATION) v. BANK OF CHINA (HONG KONG) LTD

Citation

TELE-ART INC. (IN LIQUIDATION) v. BANK OF CHINA (HONG KONG) LTD
Court

Court of Appeal
Case number

CACV283/2011

On true construction of the share charges the Bank was contractually entitled to recoup from the net proceeds costs incurred in enforcement and related proceedings and was entitled to retain a reasonable amount as provision for reasonably anticipated future costs to finalise the accounting; quantification to be determined subsequently and incurred costs recoverable on an indemnity basis.
27 Feb 2009

PECONIC INDUSTRIAL DEVELOPMENT LTD v. LAU KWOK FAI AND OTHERS

Citation

PECONIC INDUSTRIAL DEVELOPMENT LTD v. LAU KWOK FAI AND OTHERS
Court

Court of Final Appeal
Case number

FACV18/2008

The Court held that persons who are non-fiduciary dishonest assisters are not 'trustees' for the purpose of s.20 of the Limitation Ordinance and therefore may invoke limitation defences; further, on the facts the plaintiff (Peconic) could, with reasonable diligence and given its resources, have discovered indications of Lau's participation within the statutory period, so s.26 did not postpone commencement sufficiently to revive the claim; accordingly the appeals are dismissed.
27 Feb 2009

PECONIC INDUSTRIAL DEVELOPMENT LTD v. LAU KWOK FAI AND OTHERS

Citation

PECONIC INDUSTRIAL DEVELOPMENT LTD v. LAU KWOK FAI AND OTHERS
Court

Court of Final Appeal
Case number

FACV17/2008

The Court held that non‑fiduciary dishonest assisters are not 'trustees' within s.20 of the Limitation Ordinance and thus may, in principle, rely on limitation; applying s.26, on the facts Peconic could with reasonable diligence have discovered Lau's participation in the fraud more than six years before issuing proceedings, so the appeals were dismissed and the defendants were entitled to the limitation defence and costs accordingly.
20 May 1988

CURRENT FINANCE LIMITED AND OTHERS v. CHUNG PUI LIN, PAULINE AND ANOTHER

Citation

CURRENT FINANCE LIMITED AND OTHERS v. CHUNG PUI LIN, PAULINE AND ANOTHER
Court

Court of First Instance
Case number

HCA1472/1986

Although company funds were misapplied by the director, the court found no evidence the defendant had actual or constructive knowledge sufficient to put a reasonable person in her position on inquiry; the payments were accepted as repayments of loans and household expenses (consideration), so the defendant was a bona fide recipient for value without notice and not a constructive trustee. Accordingly the plaintiffs' claim failed.

Hong Kong Case Law

LIU HSIAO CHENG v. WONG SHU WAI AND OTHERS

TIMMERTON COMPANY INC v. EQUITY TRUSTEE LTD AND ANOTHER

TELE-ART INC. (IN LIQUIDATION) v. BANK OF CHINA (HONG KONG) LTD

PECONIC INDUSTRIAL DEVELOPMENT LTD v. LAU KWOK FAI AND OTHERS

PECONIC INDUSTRIAL DEVELOPMENT LTD v. LAU KWOK FAI AND OTHERS

CURRENT FINANCE LIMITED AND OTHERS v. CHUNG PUI LIN, PAULINE AND ANOTHER