Archive for the ‘Chinese customary law’ Category

Removal of the duty manager of a tso or t’ong

December 3, 2016

In Tang Fu Sun v Tang Lik Yuen ([2016] 4 HKLRD 608) the managers of two Chinese customary trusts sought declarations that the duty manager of the trusts (the same person being duty manager of both trusts) had been validly removed from office by a meeting of the general assembly of the descendants in January 2006. The defendant, the duty manager, argued that this resolution was ineffective since: (a) the proposed resolution to remove him had not appeared on the agenda for the meeting; and (b) that the customs of the trusts required resolutions of the assembly to be passed unanimously. The defendant argued that neither of these conditions for his valid removal had been satisfied. The plaintiffs were granted the declarations that they sought. Based on the law of meetings, there was no requirement to place the proposal to remove the duty manager on the agenda for the meeting since this amounted to a proposal to dismiss an employee and did not affect the interests of members as such. Nor was the defendant able to establish the existence of a custom that required decisions of the assembly to be reached unanimously.

Anthony To J. commented on the status of a duty manager. Unlike the manager, which was a requirement of section 15 of the New Territories Ordinance, there was no legal requirement to have a duty manager and the duty manager had the status of an employee. In the absence of some custom to the contrary, it was reasonable to think that the manager had the power to appoint and remove the duty manager since the manager would be legally liable for the duty manager’s actions or omissions. The managers’ evidence that the customs of the trusts gave them power to appoint and remove the duty manager as an exercise of their own authority was inherently reasonable and, for that reason, plausible. Since the duty manager was also a member of the trusts, a requirement for unanimity would amount to a requirement that he vote for his own removal; this would be an absurd requirement. Given that the assembly was at the heart of the governance of the trusts, it too had the power to remove the duty manager ([51]).

Michael Lower

Compensation paid on the resumption of land is not ‘land’ for the purposes of section 13 of the New Territories Ordinance

March 25, 2015

In Lok Tin Choi v Lai Kwai Lin ([2015] HKEC 389, CA) a mother held land in the New Territories on trust for her son. The land included two lots that had been resumed by the Government. The mother claimed to have an interest in the compensation money. This was on the basis of Chinese law and custom requiring her son to maintain his mother for her life and to provide dowries (if applicable) for the two unmarried daughters.

Cheung JA gave the principal judgment. Section 13 of the New Territories Ordinance allows the court to recognise and enforce any Chinese custom or customary right affecting land in the New Territories. The definition of ‘land’ in section 2 of the Ordinance does not cover compensation received on the resumption of land and so the court had no power to enforce any Chinese custom or customary right said to affect the compensation money. The cases that held that compensation received in respect of Tong land remained subject to the trust were not authority for the proposition that the compensation was equivalent to land. Cheung JA refrained from comment on the Chinese law and custom that had been invoked.

Michael Lower

Proper representatives of an estate consisting of a share in the assets of a wui

August 29, 2013

In Man Leung v Man Yuet Kwai ([2013] 2 HKLRD 1122, CFI) a share in a wui had been left by H to ‘Fuk Ma’. The main question was whether, as a matter of fact, this referred to just one of H’s wives (Madam To) or to all three. It was in essence a dispute between those descended from  Madam To and the descendants of another wife. All of the wives died some time ago. The contest was between the descendants in the male line of Madam To (who alleged that only they were entitled) and those of a concubine or third wife who argued that they too were entitled to a share along with the descendants of the second wife. The descendants of Madam To succeeded. On the facts, ‘Fuk Ma’ referred only to their mother.

Devolution of the interest was governed by Chinese customary law ([143]). It was common ground between the parties that the share would pass to the descendants in the male line of Fuk Ma once the identity of the person or persons so referred to had been established.

Even though the assets of Madam To’s estate comprised a share in a wui, the estate had to be administered in accordance with ordinary Hong Kong law.  No probate or letters of administration had been granted in respect of Madam To’s estate([150] – [151]). The share in the proceeds of sale of the wui land belonging to Madam To’s estate could not be paid out until lawful personal representatives of Madam To had been appointed.

Michael Lower

Adverse possession and Tso land

February 4, 2013

In Leung Kuen Fai v Tang Kwong Yu ([2002] 2 HKLRD 705, CFI) L claimed that he (and his father before him) had been in possession of land owned by the defendant Tso. The periods of adverse possession taken together stretched back to 1923.

The court held the relevant law for the period from 1923 until the commencement of the Limitation Ordinance in 1865 was the Real Property Limitation Act 1833. The members of a Tso each have their own independent life interest in the Tso land which they do not claim through any other person. They have a right to possession for the purposes of the Limitation Ordinance and the equitable interest survives any effect that the law of limitations might have on the legal title. In this case, there had never been a time when there was not a member whose right to possession had not been defeated as a result of the law of limitations.

It was possible that the legal title of the managers had been defeated as a result of 20 years’ adverse possession commencing in 1923 since the Real Property Limitation Act 1833 did not have a provision equivalent to section 10(2) of the Limitation Ordinance.  At the date of the action there were three members of the Tso whose right to possession had not been defeated by L’s possession and who could therefore bring proceedings ([73]).

The Limitation Ordinance applies to Tso land as to any other land in Hong Kong notwithstanding section 13 of the New Territories Ordinance ([72]).

Can a widow claim a share of Tso / Tong property?

February 1, 2013

In Lee Sun Kiu v Ho Kay Fuk ([2004] HKCU 960, CFI) P was the widow of the member of a customary trust. Her husband had died several decades before the action. The couple had two daughters but no sons. Trust property had been sold and P sought a declaration that she was a member of the Tong and entitled to a share of the proceeds of sale. Her action failed.

In principle, membership of a Tso or Tong is exclusively for male members. While the court did not rule out the possibility of a local custom to the contrary, there was no cogent evidence of such a custom in this case ([34] – [51]).

As regards Tso / Tong properties (rather than family properties):

‘Since the interest and membership arises upon birth and ceases upon death, there is no question of succession of such interest and membership from father to son. Nor is there any question of that interest and membership forming part of the family property of a deceased male. When an heir is adopted posthumously, the adopted son becomes a member on his own right instead of being succeeded to the interest of the deceased in the Tso.’ (72]).

Posthumous adoption no longer possible in Hong Kong

January 31, 2013

In Liu Ying Lan v Liu Tung Yiu ([2003] 3 HKLRD 249, CA) F was an indigenous inhabitant of a village in the New Territories. He had two daughters, P and D2. He died in 1943 and his widow died in 1987. F’s nephew, D1, claimed to be entitled to F’s property in accordance with Chinese customary law as he was F’s nearest male relative. He also sought to be posthumously adopted by F. It was accepted that the Intestates’ Estates Ordinance did not apply in this case as F had died in 1943. D1 failed in both respects.

D1 was not entitled to succeed to F’s estate under the Qing Code since he had already inherited property from his own father. Chinese customary law prevented D1 from succeeding to the property of both his father and his uncle ([29] – [48]).

Further, posthumous adoption is no longer possible in Hong Kong ([67]). Section 25 of the Adoption Ordinance makes it clear that the only form of adoption possible is adoption under the Ordinance. The legislature had made its intention to override Chinese customary law in this respect very clear ([49]). Statute can vary Chinese customary law ([58] – [66]).

Illegitimate son’s right to Tso distributions

January 30, 2013

In Tang Chun Kit v Tang Lo Ping ([2004] HKEC 1105, CFI) P was the illegitimate son of the member of a Tso. D was the manager of the Tso who, in essence, sought the court’s directions as to how to proceed. P sought to have his name recorded in the Register of Indigenous Inhabitants in respect of the Tso. He also made a retrospective claim to a share of distributions made since his birth.

The court heard expert evidence as to the relevant Chinese customary law. The parties accepted that membership of a Tso was a birthright and did not depend on having gone through any formalities ([17]). There was a question as to whether illegitimate sons were entitled to a full share or only a half share. Insufficient evidence on this point was made available to allow the court to settle this point and so a second hearing was arranged. By the time of this hearing ([2005] HKEC 1469) the parties had agreed that illegitimate sons were entitled to a full share ([8]).

P accepted that he could not make a retrospective claim. The court held that D had acted reasonably in relying on the records of the Tso in making earlier distributions. There was no duty to conduct a full enquiry as to the membership of the Tso before making a distribution ( [2004] HKEC 1105, [39]).

As to costs, the court applied the general rule that the trust fund should bear the costs of an action seeking directions as to the administration of the trust ([2005] HKEC 1469, [20]).

Doubt as to legal status of wife / concubine: solicitors’ duty to correctly identify status

June 7, 2012

Estate of Tse Chu ([2012] HKEC 770) concerned T’s estate. She had married her husband in Hong Kong in 1945 and died intestate. Her husband had contracted two previous marriages in Mainland China in 1925 and 1932 respectively and there were children of these marriages which had never been brought to an end. The affirmation in support of an application for letters of administration stated that her husband had other wives. In answer to a requisition concerning their statuses, the solicitors acting stated that they were ‘equal wives.’ It was clear, however, that they were not ‘equal wives’ (ping chai). Whether T was her husband’s concubine was unclear. The answer to this question would have very practical consequences for the administration of the estate. The court reminded the solicitors that it was their duty to take proper instructions and obtain expert evidence if need be so that T’s legal status (and that of the other wives) could be correctly identified. It was not enough to transmit the layman’s view of the matter.

Money paid on the resumption of land held for purposes of ancestral worship is subject to the same trusts

February 1, 2012

In Tang Che Tai v Tang On Kwai ([2008] HKEC 143, CA) land held by a certain Tong had been resumed by the government. The question arose as to whether the compensation received was subject to the same trust (governed by Chinese law and custom) as the land had been. If so, then the unanimous consent of all of the members would be needed to any distribution. The further question then arose as to whether the members of the Tong could contractually vary the terms of the trust (an agreement had been entered into in a 1982 members’ meeting providing that compensation monies would be divided between the members).

The Court was unanimously of the view that the compensation money was subject to the same trusts as the original land had been and that the special treatment afforded to Chinese customary trusts by section 13 of the New Territories Ordinance also applied to the compensation money. Distribution of the money could only be carried out in accordance with Chinese law and custom. Expert evidence showed that the agreement entered into in 1982 between the members of the Tong could not effectively vary the terms of the trust; it would not have that effect under the relevant Chinese law and custom.

Johnson Lam J. pointed to articles 8 and 18 of the Basic Law. Article 18 provides for the continuing application of the laws previously in force. These, by virtue of article 8, include customary law. The previous law had included English law ‘except where the same shall he inapplicable to the local circumstances of the said Colony, or of its inhabitants’ (Supreme Court Ordinance 1844, s.3 and the Application of English Law Ordinance 1966). This resulted in the disapplication of the rule against perpetuities as regards Chinese customary trusts since it would destroy them. (85])

‘Hence, Chinese customary law should continue to apply to a Tso or Tong that originally held land in the New Territories after the land had been changed to other form of assets.’ ([88]).

There was also a dispute as to the legitimacy of paying pai ji (sums for the relief of poverty) even though the making of such payments had begin only recently and was approved by a majority (but not by all) of the heads of the fongs. It was held that such payments were not in accordance with the terms of the trust unless made with the unanimous consent of the members of the Tong (or the heads of the fongs on their behalf) and an injunction was granted to restrain any further such payments.

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

January 27, 2012

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).