Hong Kong's Financial Dispute Resolution Scheme will be expanded with effect from January 1 2018 and July 1 2018 by amending the jurisdiction and terms of reference of the Financial Dispute Resolution Centre. Alongside the recent changes to allow third-party funding in arbitration, the changes to the scheme show that alternative dispute resolution is coming of age for financial disputes in Hong Kong where there is an imbalance of power between parties.
The Court of Final Appeal recently handed down a landmark judgment in favour of the LGBT community. Employers are recommended to review their policies to ensure that they are in line with the principles laid down in the decision. In particular, employers should ensure that spousal employment benefits (eg, those set out in employment contracts) also apply to same-sex spouses, in addition to opposite-sex spouses.
In Hong Kong, an employment contract can be terminated by either the employer or the employee by giving the other party notice or making a payment in lieu of notice. A payment in lieu of notice is calculated by reference to the average daily wages earned by the employee in the 12 months preceding the day on which notice of termination is given. It is therefore important to understand what is meant by 'wages' under the Employment Ordinance.
Since 2014 the Labour Tribunal has had the power to order parties to provide security for awards or orders. The grounds for making such an order are relatively broad and give the tribunal considerable discretion. However, there has been little case law on how this discretion should be exercised. A recent Court of First Instance decision sheds some light on this area of law.
A Hong Kong court recently considered the enforcement of a non-solicitation clause against an employee who was employed as a delivery worker. The court's observations in this case as regards the enforceability of non-solicitation clauses reiterate the well-established position that employers have no right to be protected against competition per se.
In Hong Kong, there is an increasing emphasis on the importance of reciprocal duties of trust and confidence between employers and employees. 'Moonlighting' employees (even ones who take up ancillary employment with a non-direct competitor) often sit in a legally precarious position, since questions are bound to arise in relation to their fiduciary duties, restrictive covenants and the implied term of trust and confidence.
The Hong Kong Insurance Authority (HKIA) will take over the regulation of insurance intermediaries from the three self-regulatory organisations in mid-2019. Given that there are several sets of competence standards across these organisations, it is necessary to consolidate and update them in line with the statutory requirements to improve protection for policyholders. As such, the HKIA recently held a public consultation on two guidelines under the Insurance Ordinance (Cap 41).
The Hong Kong Insurance Authority (HKIA) has achieved a consensus with the China Banking and Insurance Regulatory Commission that the latter will provide preferential treatment to Hong Kong reinsurers by reducing the reinsurance credit risk requirement under China's Risk-Oriented Solvency System for mainland insurers that use Hong Kong reinsurers authorised by the HKIA. This new arrangement should improve Hong Kong's credentials as an Asian reinsurance hub.
The Hong Kong Insurance Authority recently released a draft guideline on enterprise risk management as part of Hong Kong's move towards a risk-based capital regime. The draft guideline considers the recent consultation and review of the relevant insurance core principles by the International Association of Insurance Supervisors and aims to nurture a strong risk culture which reflects the values, attitudes and norms of business behaviour.
Lawmakers recently met to discuss a new bill to establish a policyholders' protection scheme to protect policyholders' interests in case an insurer becomes insolvent. This safety net will cover individuals, small and medium-sized enterprises and building owners' corporations. All authorised insurers in Hong Kong will have to participate and pay an initial levy to build up the two compensation funds – namely, the life fund (for long-term policies) and the non-life fund (for general policies).
If a policyholder is dissatisfied with the conduct of an insurer, agent or broker, there are various channels for making a complaint. One such channel is the Insurance Claims Complaints Bureau, which was recently revamped to provide Hong Kong's insurance industry with improved methods of settling personal insurance claims and disputes by providing policyholders with an alternative dispute resolution process.
Hong Kong has a high incidence of litigants in person, which is largely explained by the cost of civil litigation generally, the absence of class actions, contingent fee arrangements and third-party funding of most civil claims, and the financial eligibility limits for civil legal aid. As recent decisions show, the rates at which litigants in person are awarded costs are far from generous and, to get more, they have to prove that they had to work on the case during their working hours or that they suffered actual pecuniary loss.
In a recent case, the High Court allowed the plaintiff's application for an order that the first defendant and a representative of the second defendant attend a court hearing to be cross-examined on affirmations made by them in the proceedings. The case is a timely reminder of the seriousness of making affidavits or affirmations and of the need to be mindful of the documents to which they refer.
The High Court recently reiterated the general principles which govern its power to order a non-party to pay the costs of another party to court proceedings. The court's power is statutory but the general principles that govern the exercise of its discretion arise out of case law. The case law demonstrates that the court's discretion to make an order for costs against a non-party is wide. The interests of justice are paramount.
A High Court judge recently dismissed a party's appeal against a refusal to grant permission to issue subpoenas directed at another party's legal representatives. At the same time, the judge reminded litigants and their legal representatives that subpoenas (directing a witness to attend court to give evidence, produce documents or do both) should be issued in a timely manner, and that late subpoenas which upset the court's case management of trial dates are likely to be frowned upon.
The Norwich Pharmacal order is an important tool for combating fraud. Given the prevalence of electronic and identity fraud, the ability of victims to recover lost money through the civil courts has assumed a high profile of late. For plaintiffs who fall prey to such fraudsters, the ability to obtain a court order prohibiting a defendant from disposing of (among other things) money in a bank account (ie, a Mareva injunction) and to obtain timely disclosure of details of alleged wrongdoing from a defendant's bank (eg, Norwich Pharmacal relief) is often crucial.