STEPPING UP - ISSUE 28 (31 October 2014)
Lots have happened since my last message but what comes fresh to mind is my trip to the Hong Kong STEP Asia conference, which event happened right smack in the midst of the Hong Kong street protests. I had some scheduled meetings but not all attending made those meetings-quite understandably as taxis in Hong Kong were not able to make the usual routes because of road blocks. Thankfully, the conference went smoothly with all delegates thoroughly enjoying the STEP offering and certainly the great Hong Kong food during our stay there! I’ve just had a STEP Branch committee meeting and we’re all hyped up to do an even better STEP Asia conference in Singapore in 2015.
|INDUSTRY NEWS & UPDATES:|
|Feedback Sought on Proposed New Regulation to Amend Definition of ‘Accredited Investor’ (“AI”)|
|The MAS has issued a consultation paper on 21 July 2014 to invite feedback on proposed new legislation to the Securities and Futures Act (Cap. 289) and the Securities and Futures (Prescribed Specific Classes of Investors) Regulations 2005.
The STEP Singapore Committee has sent its feedback to the MAS, and are presently still in the process of providing further feedback to the MAS.
|Decision making, mental capacity and undue influence: exploring the grey areas between capacity and incapacity?|
|A series of recent UK cases have explored that difficult space between decisions made by those who lack mental capacity and those who (perhaps) just have capacity but are in a situation where they cannot effectively make their own decisions because they are vulnerable as a result of coercion or the influence of relatives or friends who are seeking to force decision making on an individual. How, if at all, should the courts act to protect those who are not making their own free choices.
The Mental Capacity Act in Singapore is largely modelled on the UK Mental Capacity Act 2005. Under this Act capacity is a decision specific test and there is a presumption of capacity for adults. However a person who has an “impairment of the mind or brain” may lose capacity if the person, called P in the Act, cannot understand the information relevant to a decision, retain that information (possibly only for a short period), use or weigh the information to make a decision and then communicate that decision to others (see section 5 MCA).
Contributed by: David Lock QC, Landmark Chambers, London
UPDATES & DEVELOPMENTS:
|“Pitfalls of Family Trusts and Family Investment Holding Company/ Family Business Companies”|
|The following 2 write-ups are kindly contributed by the speakers Robert Foote, Partner -Walkers (Singapore) LLP, Richard Norridge - Head of Asia Private Wealth Practice, Herbert Smith Freehills further to a seminar on “Pitfalls of Family Trusts and Family Investment Holding Company/ Family Business Companies” conducted for STEP Singapore on 1 October 2014 (12-2pm) and chaired by Chee Fang Theng, Director of Pan Asia Law LLC.
In our experience and as a matter of BVI law whenever there are family shareholder disputes involving BVI holdings companies there is almost invariably a threat to issue a statutory unfair prejudice claim pursuant to section 184I of the BVI Business Companies Act or a threat to apply to appoint a liquidator of the company on what is known as the just and equitable ground pursuant to section 162 of the Insolvency Act 2003. Often those threats turn into Court proceedings.
Contributed by: Robert Foote - Partner, Walkers (Singapore) Limited Liability Partnership
Potential Pitfalls Of Family Trusts
As a London QC once commented to me: "If trusts are such a good idea, why are there so many trust litigators?" Picking up on the increasing number of high profile disputes, on 1 October 2014, I gave a talk to STEP Singapore members on family trust disputes, their common causes and ways of resolving them. Disputes come in many shapes and sizes, but they can be family disputes where trustees are simply caught in the middle, disputes directly against trustees or challenges to the trust fund brought by third parties. Common examples of this last type of dispute arise in the context of fraud, challenges to the trust's validity or divorce. In the divorce context, disputes often focus on whether trust assets are "matrimonial assets" to be divided between separating spouses.
Contributed by: Richard Norridge - Head of Asia Private Wealth Practice, Herbert Smith Freehills
|Eschewing Neutrality – Trustees’ Duties When Faced With Adverse Claims To Trust Assets|
|The following write-up is kindly contributed by Paul Tracey - Consultant, Grosvenor Law, further to his seminar for STEP Singapore on 1 September 2014 chaired by Annette Sui, Managing Director and Head of Private Wealth Solutions, Southeast Asia, HSBC Private Bank.
An attack on a trust, by way of a claim asserting a superior proprietary right to trust assets than that enjoyed by a trustee or a trust’s beneficiaries, necessarily presents a problem for the relevant trustee.
A claimant may, for example, claim that he or she had a legal or beneficial proprietary interest in the trust property preceding in time the creation of the legal and equitable rights that constitute the trust and then seek to assert a right to follow his or her earlier, alleged proprietary interest into the trust property.
Contributed by: Paul Tracey - Consultant, Grosvenor Law
|Giving Back (20th November 2014, 12.00-2.00pm, Intellioffices, Level 3, 146 Robinson Road, S 068909)
|The panel speakers will give the perspectives of Western and Asian families in creating their charitable legacy, as well as the potential use of Singapore to further such philanthropic intent.
Areas of discussion include:
• Motivations and trends in charitable giving
• Differences between western and Asian charitable recipients which may impact giving
• Choice between Grant making vs. self-administered charities?
• Governance of the charity
• Creating a sustainable endowment fund
• Singapore as the philanthropic hub - tax/legal considerations, incentives, infrastructure etc.