While those in the industry hoped that the 2013 trust law reforms in Hong Kong could raise their profile, it is yet to be seen whether the use of trusts in Hong Kong will increase. However, for those wishing to add trust law to their practice or in need of a reference manual, this is certainly the book for you. At 474 pages, with the last 50 or so devoted to precedents, it contains a wealth of information on all aspects of trust law and the drafting of trusts.
The first six chapters of the book contain general information, starting with a short history of the origins of Hong Kong trust law and the use of trusts in Hong Kong. It then delves into the changes made by the Amendment Ordinance in 2013 before examining more esoteric issues, such as style in drafting and principles of construction and interpretation. There are useful references to Hong Kong case law, the use of the Chinese language in trusts and wills, as well as specific examples on how to draft Hong Kong trusts,making these chapters relevant for local practitioners.
The next 16 chapters, however, are the meat of the book. They include detailed, technical information on all aspects of trusts from issues surrounding beneficiaries, protectors and trustees to the drafting of overriding powers and settlor exclusion clauses, administrative provisions, restrictions on the rights of beneficiaries, indemnities, governing law and execution. It seems as if no issue has been left unaddressed.
Take, for example, the concerns of a client who is soon to be married and appeals to you to take such steps as possible to draft his new trust to prevent claims against the trust property in the event of divorce. The forms of “marriage settlements” are discussed in great detail in the book. Or, you are tasked with determining how to deal with trusts over shares in family companies and the trustees’ duty to supervise. The authors have even included useful wording for drafting of deeds of appointment and other documents supplemental to existing trusts, although it comes with a warning to those new to trust drafting.
The technical detail chapters are, perhaps rather confusingly, interspersed with six chapters that examine particular types of trusts – starting with lifetime interest in possession trusts, discretionary and will trusts to bare trusts, charitable trust and trusts of life insurance policies. These chapters go into depth on the specifics of each. Although historically it was most common to see discretionary trusts used in Hong Kong, with the abolishment of estate duty and the modernisation of the trust law more recently, Hong Kong draftsmen should be encouraged to diversify their repertoire and ensure that they are creating settlements to suit the needs of each particular client. This book can assist draftsmen in doing so.
The final portion of the book includes precedents for administrative provisions for use in all forms of trusts and will trusts, short form discretionary, charitable and interest in possession trusts and useful deeds for the appointment and retirement of trustees. The precedents exemplify the authors’ preference for a modern form of document, simplicity of style and avoidance of the use of legalese. They are in no way comprehensive, though; so if you are looking for a book solely devoted to precedents, this would not be the book for you. Although the detail contained in the previous chapters will allow you to manage the drafting yourself with little difficulty.
As the first book devoted to the drafting of Hong Kong trusts, Drafting Trust and Will Trusts in Hong Kong will be a useful addition to any trust law practitioner’s shelf.
PUBLISHER: Sweet & Maxwell