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Thursday, May 19, 2022

Henry Fok gave HK$3.52 bln to male close friend, court heard

Late billionaire Henry Fok Ying-tung had transferred HK$3.52 billion to his close friend Ho Ming-sze, a former deputy secretary general at the Xinhua News Agency's Hong Kong division, the High Court was told on the first day of the trial of the family's feud over ownership of an HK$8.5 billion Nansha project.
The 82-day trial is being heard before judge David Lok who extended the trial from to 72 days, from the original 60, with another 10 days for closing.

In an agreement about the transferal to Ho, Fok granted him all rights to use the cash and stocks totaling HK$3.52 billion, and that Fok's family “shall not have any dispute on how Ho Ming-sze handles" the sum, the court heard on Tuesday. Ho died in 2018 at the age of 95.

The trial began with the opening by senior counsel Benjamin Yu, who represents one of the plaintiffs, Nora Fok Lai-lor, daughter of late Fok with his first wife Fok Lui Yin-nei.

Yu told the court that one of the defendants, Ian Fok Chun-wan, who is the second son of the late Fok, had told former chief executive Tung Chee-hwa that the late tycoon’s legacy was about HK$11.3 billion.

The late Fok had also given HK$3.52 billion to Ho who was in charge of Fok Ying Tung Ming Yuan Development Company, which was responsible for the Nansha development project.

Yu also said the late Fok wanted to revive his glory in real estate sector through his “Nansha dream” as he wanted to develop Nansha into “Shanghai Putong in Guangzhou” or “Tsim Sha Tsui or Central in Guangzhou”.

The development plan in Nansha, a city in the late tycoon’s hometown Panyu in Guangzhou, was not only for charity, but he also wanted to make a fortune from the project, the court heard.
The Nansha project’s shares have been divided into two parts, one was held by Fok Ying Tung Panyu

Development Foundation, and the other half was held by Yau Wing Company -- apparently owned by Fok's siblings.

In June 1997, Yau Wing sold the share to Fok Ying Tung Foundation at HK$1 and the foundation provided an interest-free loan to Yau Wing.

Both parties of the case agreed that Yau Wing had the right to buy back the share at HK$1 within 10 years before June 30, 2007. If Yau Wing buys back that share in 2007, it has to repay a HK$2.3 billion loan to the foundation. It was understood the three plaintiffs, the late tycoon’s third son with his first wife Benjamin Fok Chun-yue, and two daughters, Nora Fok and Patricia Fok Lai-ping, would like Yau Wing to buy back the share.

Yu said despite Fok Ying Tung Foundation being a charity, the late Fok, as a rich businessman and philanthropist, had to make money before he could donate money.

The late Fok had asked Ian Fok to transfer Yau Wing’s share to the foundation in June 1997.

Yu said from a commercial angle, Yau Wing would not transfer its share to the foundation without any reason, and believed that Yau Wing had to repay loans by the foundation on the Nansha project.

Yu also quoted a biography of Henry Fok that he had said he was a victim of “persecution by the US and UK” after he rented Star House in Tsim Sha Tsui to Chinese Arts & Crafts, which the British colonies considered that as a pro-Chinese move and the US consulate in Hong Kong blacklisted the Star House, forbidding tenants there to trade US products.

The late Fok was forced to fade out of Hong Kong's property market after he was persuaded to sell Star House to British company Hongkong Land for just HK$37.5 million, the court heard.

It is expected that one of the plaintiffs, Benjamin Fok Chun-yue, will testify next Monday.

Lok (judge) has asked senior counsel Jat Sew-tong, who represents Fok Ying Tung Foundation, on whether the Department of Justice intends to intervene in the case.

Jat said the DoJ would like to be reported on the case progress.

Benjamin Fok and his sisters Patricia Fok and Nora Fok filed a writ to the court to restart the feud in 2016, accusing their brother Ian Fok of allegedly concealing a buyback agreement on the Nansha project.

They also said their eldest brother Timothy Fok Tsun-ting knows about the buyback agreement.

The hearing continues on Wednesday.

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