- Hong Kong’s highest court clarifies the extent of trustees’ supervisory duties over delegated investment management functions in anti-Bartlett clause case (Zhang Hong Li v DBS Bank)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- Case details
Private Client analysis: The Hong Kong Court of Final Appeal has reversed the decisions of Hong Kong's Court of Appeal and lower courts in finding that extensive anti-Bartlett provisions in the trust deed of a Jersey family trust effectively exempted the trustees after investments in high risk foreign exchange transactions suffered significant losses during the 2008 financial crisis. In reaching this decision, the Court of Final Appeal rejected the idea propounded by the lower courts that the trustees retained a ‘high level supervisory duty’, even where the trust deed expressly relieved them from any duty to interfere with the business or the management of the underlying investment company. Written by Andreas Kistler and Louise Woolrich, partner & senior associate in Trusts & Private Wealth/Dispute Resolution, at Carey Olsen Jersey LLP.
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