Effectiveness Of Anti-Bartlett Clauses Confirmed

The Hong Kong Court of Final Appeal has delivered its highly anticipated judgment, overturning the earlier judgments and confirming that trustees may continue to rely upon provisions commonly known as 'anti-Bartlett' clauses in trust instruments, which seek to negate a trustee's duty to enquire into or interfere in the management of underlying companies within a trust structure when an investment manager is appointed.

Facts

In our October 2019 article here, we touched upon the facts of ZHANG HONG LI AND ANOTHER V DBS (HONG KONG) LTD AND OTHERS [2018] HKCA 435 and addressed the reasons why the Hong Kong Court of Appeal's judgment was unlikely to affect VISTA or STAR trusts. On 22 November 2019¹, the Hong Kong Court of Final Appeal (Court of Final Appeal) overturned the Court of Appeal's judgment, removing all doubt about the ongoing relevance of anti-Bartlett clauses and the limited duty owed by a trustee in those circumstances.