On Wednesday, the Court of Final Appeal ("CFA") reversed the lower courts' decision in the Yung Kee case¹ , holding that the Hong Kong court has jurisdiction to order the winding up of Yung Kee Holdings Limited (the "Company"), a holding company incorporated in the British Virgin Islands and not registered in Hong Kong.

In 2014, the law of privilege was considered from various angles, with the year closing on a Court  of Final Appeal decision emphasising the primacy of legal professional privilege ("LPP") as an  absolute right guaranteed by the Basic Law of Hong Kong.

While the cases outlined below generally provide comfort that the law of privilege in Hong Kong  holds strong, we offer a few practical points to help safeguard the privilege of legal advice:

London & Westcountry Estates Limited ("LWE") went into administration in March 2012. The directors of LWE claimed that its bankers had mis-sold an interest rate swap product to them, and that they were, as a result, entitled to compensation. As LWE was in administration, it was for the administrators to bring the claim against the bankers. The administrators, however, declined to bring an action on behalf of LWE, and also declined to assign the cause of action to the directors.

The Court of Appeal has declined jurisdiction to wind up Yung Kee Holdings Limited (the "Company"), a company incorporated in the British Virgin Islands ("BVI"), upholding the decision of Harris J at first instance that the Company did not have "sufficient connection" with Hong Kong. 

On 29 February 2012, the Supreme Court handed down its decision In the matter of Lehman Brothers International (Europe) (In Administration) and In the matter of the Insolvency Act 1986. The appeal addressed the meaning and application of Chapter 7 of the Client Assets Sourcebook (CASS 7) issued by the FSA for the safeguarding and  distributing of client money in implementation of the Markets in Financial Instruments Directive 2004/39/EC.

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