Mayer Brown represented the appellants in the long-running case of Zhang Hong Li & Ors v DBS Bank (Hong Kong) Ltd & Ors, which has been closely followed by the trust and private wealth industry around the world as it raises important issues relating to duties of trustees and the effect of "anti-Bartlett" clauses in trust instruments.

On 22 November 2019, the Hong Kong Court of Final Appeal (CFA) handed down its judgment notwithstanding a post-hearing settlement between the parties because of the general public importance of the issues involved. The CFA confirmed the effect of the anti-Bartlett clauses in the case and stated that had the case not been settled, it would have unanimously overturned the decisions of the Court of First Instance and the Court of Appeal, both of which found liability against the trustee and the corporate director of the trust's private investment company for breach of a "high level supervisory duty", notwithstanding the existence of the otherwise effective anti-Bartlett clauses.

The CFA's decision came as a huge relief as anti-Bartlett clauses have long been regarded as an effective tool and widely used to limit duties of trustees. Certainty over their effect is highly important to all stakeholders in the trust world.

DownloadsDownload Document

February 28 2020

Visit us at www.mayerbrownjsm.com

Mayer Brown is a global legal services organization comprising legal practices that are separate entities (the Mayer Brown Practices). The Mayer Brown Practices are: Mayer Brown LLP, a limited liability partnership established in the United States; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales; Mayer Brown JSM, a Hong Kong partnership, and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2020. The Mayer Brown Practices. All rights reserved.

This article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein. Please also read the JSM legal publications Disclaimer.