Wang and Wong v Grand View Private Trust Company Ltd and Ors

• Jurisdiction: Bermuda
• Judge: Clarke P,Smellie JA,Subair Williams JA
• Judgment Date: 12 April 2021
• Court: Court of Appeal (Bermuda)
• Docket Number: Civil Appeal 2021 No 1

[2021] Bda LR 29

In The Court of Appeal for Bermuda

Before:

Clarke P; Smellie JA; Subair Williams JA

Civil Appeal 2021 No 1

Between:

Wang, Ven-Jiao (Tony Wang) (as joint administrator of the Bermudian estate of YT Wang)

and

Wong, Wen-Young (Winston Wong)

Appellants

and

Grand View Private Trust Company Limited

Transglobe Private Trust Company Limited

Vantura Private Trust Company Limited

Universal Link Private Trust Company Limited

Estate of Hung Wen-Hsiung, Deceased

Ocean View Private Trust Company Limited

Wang, Ruey-Hwa (Susan Wang)

Wang, Hsueh-Min (Jennifer Wang) (as joint administrator of the Bermudian estate of YT Wang)

Respondents

Mr R Wilson QC and Mrs F Rana-Fahy for the Appellants

Mr J Adkin QC and Mr S Pearman for the Respondents

The following cases were referred to in the judgment:

Buttes Gas and Oil Co v Hammer (No 3) [1981] 1 QB 223

James-Bowen and ors v Commissioner of Police of the Metropolis [2018] 1 WLR 4021

Love v Robert Fawcett and Northam Worldwide [2011] EWHC 1686

R (Ford) v Financial Services Authority [2011] EWHC 2583

Cia Barca de Panama SA v George Wimpey & Co Ltd [1980] 1 Lloyd's Rep 598

BBGP Managing General Partner Ltd v Babcock & Brown Global Partners [2011] Ch 296

Dolling-Baker v Merrett and Another [1990] 1 WLR 70

Commercial Union Assurance Co Plc v Mander [1996] 2 Lloyd's Rep 64

Shared interest privilege — Joint interest privilege — Whether donor of power of attorney had joint interest privilege with private trust companies who retained law firm which prepared the power of attorney — Whether joint interest in the subject matter of privileged materials and communications — Relevant legal principles

JUDGMENT of Subair Williams JA

Introduction

1. These judgments are the product of the collaborative work of three.

2. The coil of ongoing litigation in these proceedings ensues from a dynastic conflict over several billions of dollars' worth of assets held in five Bermuda purpose trusts which were funded from the wealth accumulated by Wang, Yun Ching (“Mr YC Wang”) who died on 15 October 2008 and his brother Wang, Yung Tsai (“Mr YT Wang”) who died on 27 November 2014. These are the two Taiwanese-born brothers (“the Founders”) who founded Formosa Plastics Group (“FPG”) which is eminently classified as one of the largest and most prosperous business establishments in Taiwan.

3. Mr YC Wang had three wives. His first wife was Wang, Yueh Lan who died on 1 July 2012 without having had any children. Mr YC Wang's second wife, Yang Chiao Wang is the mother of Wong, Wen-Young (also known as Winston Wong) (“Winston”), the eldest son of Mr YC Wang. The other siblings of this marriage are Wang, Kuei Yung (“Margaret”); Wong, Xue Ling (“Charlene”); Wang, Xue Hong (“Cher”) and Wong, Wen-Hsiang (“Walter”). Wang, Ruey-Hwa (“Susan”) is the eldest daughter of Mr YC Wang and his third wife, Pao-Chu Lee. The second eldest daughter of this marriage is Wang, Ruey-Yu (“Sandy”), followed by Wang, Ruey Huei (“Diana”) and Wang, Ruey-Jorn (“Lora”).

4. Mr YT Wang had two wives. Mr YT Wang's first wife, who died on 5 May 2019, was Pi-Ruang Wang. The children of this marriage are William WY Wong (“William”); Wilfred WT Wang (“Wilfred”); Sara HC Wang (“Sara”); Wang, Hsueh-Min (“Jennifer”) and Hsiueh-Kuang Wang (“Hsiueh-Kuang”). Mr YT Wang's second wife is Yu-Mei Chou (“Madam Chou”). Their children are Ven-Jiao, Wang (“Tony”); Tammy WY Wang and Janis HJ Wang.

5. In this appeal the Court is ultimately concerned with whether a donor of a power of attorney had joint interest privilege in attorney-client communications and related documents preparatory to the drafting and execution of the power of attorney instrument itself. It is common ground between the parties that the communication and the correlating documents qualified for protection under the rule of legal professional privilege.

6. Mr YT Wang was the putative donor of the relevant power of attorney, said to have been executed on 31 October 2012 (“the POA”), whereby at the age of 91 years he gave his eldest son, William, broad and unfettered powers to handle and dispose of all of his assets. The POA was drafted by Yao Lin, also known Ms Angela Lin (“Ms Lin”) of the law firm Lee and Li Attorneys-at-Law located in Tapei, Taiwan (“Lee and Li”).

7. Some two and a half months after the execution of the POA, the 5th Respondent was incorporated as a private trust company on 15 January 2013 and by Deed of Trust dated 8 March 2013, the Ocean View Trust was established and the 5th Respondent was declared its trustee. Thereafter, as the Respondents aver, FPG shares indirectly owned by Mr YT Wang were transferred into the Ocean View Trust by reliance upon the POA, in circumstances which are examined further below.

8. William is one of three other family members who serves as a member of the Board of Trustees for the 1st – 5th Respondents in these proceedings, which are each private trust companies. The other three family members of the Boards of the Respondents are Wilfred, Susan and Sandy. Together they represent the children of Mr YC Wang and his third wife (to the exclusion of any of the children of Mr YC Wang's second wife) and the children of Mr YT Wang and his first wife (to the exclusion of any of the children of Mr YT Wang's second wife).

9. The Respondents are the trustees of five Bermuda purpose trusts settled by the Founders, namely the Wang Family Trust; China Trust; Vantura Trust; Universal Link Trust and Ocean View Trust (“the five Bermuda purpose trusts”). Moreover, it was the first four Respondents who retained and instructed Lee and Li for the purpose of creating and executing the POA. (I shall in due course outline the evidence of the purposes for the making of the POA.) Collectively, the Respondents reject Tony's assertion that Mr YT Wang, the donor of the POA, had joint interest privilege in the communications and documents prepared by Lee and Li in respect of the POA.

10. In the underlying pending Supreme Court action (Case No.44 of 2018) before the learned Assistant Justice, Mr Ian Kawaley (“the main action”), Mr YC Wang's eldest son, Winston, is the Plaintiff. Winston challenges the validity of the Bermuda purpose trusts and the transfer of the Founders' assets into those Bermuda purpose trusts. The Appellant, Tony, is the youngest son of Mr YT Wang. Tony is the 8th Defendant in the main action and is supporting Winston's case challenging the legitimacy of the Bermuda purpose trusts.

11. By summons dated 3 December 2020, Tony applied before Kawaley AJ in a hearing held on 17–18 and 21 December 20201 for production and inspection of all documents held by Lee and Li relating to the creation and execution of what was termed “the purported Power of Attorney”. I shall refer to these documents as “the POA documents”.

12. In his written ruling delivered on 30 December 2020 (intermittently referred to as “the Ruling”) Kawaley AJ refused Tony's application for disclosure and inspection of the POA documents. Aggrieved by the Ruling, Tony filed a Notice of Appeal dated 14 January 2021 appealing to this Court for an order setting aside Kawaley AJ's decision and an order requiring the Respondents to produce the POA documents for Tony's access and inspection. The Respondents in turn filed a formal Notice on 25 January 2021 for the Ruling to be affirmed on grounds other than those relied on in the Ruling itself.

13. Having considered the written and oral arguments from Counsel for Tony and the Respondents, I now give my reasons for finding that this appeal should be allowed.

The Background

14. The assets of the impugned five purpose trusts are FPG shares held in various holding companies previously owned by an agent of the Founders, Wen-Hsiung Hung (“Mr Hung”), who was at all times acting pursuant to the direction of the Founders in respect of those shares and is said effectively to have held them on trust for such purposes as the Founders might direct. On the averments of Winston and Tony under the main action, the Bermuda trusts were always intended by the Founders to be family beneficiary trusts, holding its assets for equal division and enjoyment between each of the Founders' children. The case against Winston and Tony, which is primarily being prosecuted by the Respondents, is that the Founders' expressed wishes and intentions were for their FPG shares to be placed into Bermuda purpose trusts for the exclusive benefit of specified charitable and non-charitable purposes.

15. The administration of the financial aspects of those Bermuda purpose trusts were partly handled by senior employees of the FPG Finance Department under the supervision and direction of a Business Management Committee (“the BMC”) for each Trust. Mr Hung, Sandy, Susan, William and Wilfred were all members of the BMC.

16. After the passing of Mr YC Wang and the onset of Mr YT Wang's terminal illnesses, steps were taken by the Respondents to obtain the POA in October 2012. The fifth trust, which is the Ocean View Trust, was subsequently established in March 2013 and thereafter the remaining holding companies endowed with FPG shares were placed into the fifth trust.

17. There is a tireless battle on the evidence between the opposing parties as to what the true wishes of the Founders were in respect of their fortune in FPG shares. Of course, these are all issues for adjudication at the trial of the main action. However, a broad outline of the pleaded cases and the competing background evidence is relevant for contextual purposes.

FPG Shares held in Holding Companies

18. A majority tranche of shares in FPG were held by holding companies incorporated in the British Virgin Islands (“the BVI”) and in Liberia. These holding companies received dividends from those shareholdings only to reinvest in the purchase of further FPG shares. The control of those shares was entrusted to Mr Hung as a close family friend of the Founders. Mr Hung...