Ancestral trusts can only be created in accordance with Chinese law and custom

In Lau Wai Chau ((2000) 3 HKCFAR 98, CFA) L purported to create a Chinese customary trust by will. The available expert evidence was unanimously to the effect that Chinese customary law required ancestral trusts to be created by an inter vivos disposition. Some years after L’s death the fongs had entered into a Deed of Family Arrangement dividing L’s estate between them. The question was whether this deed could have constituted the customary trust. The Court of Final Appeal rejected the contention:

‘In my judgment our jurisprudence leaves no room for Hong Kong law to operate so as to create an instance of a Chinese law custom or institution in circumstances where Chinese law and custom does not so operate. That would amount to Hong Kong courts assembling a hybrid between Hong Kong law and Chinese customary law and custom, and then applying that hybrid in the name of, but contrary to, Chinese law and custom. I can see no juridical foundation for such an exercise.’ (per Bokhary PJ at 106).

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