(Lo family estate dispute) Matriarch tells court of riftBusiness | 7 Jun 2018 2:20 pm
The matriarch of Great Eagle Holdings (0041), Lo To Lee-kwan, who filed a case to dismiss HSBC as trustee of the family trust, continued to testify at the High Court this morning.
The 98-year-old recalled that after a family meeting in November 2015, some of her children began to have frictions in the management of the local property giant.
The third son Lo Ka-shui, Great Eagle's chairman, had hoped that his son would be promoted to executive director, but others did not believe that his son had enough experience, and should only be considered after two years.
Lo To pointed out that some of her children told her Lo Ka-shui had threatened and said: "I have a lot of Great Eagle shares, if you don't listen to me, I can have you all fired!”
And after the incident, some of the family members wrote to HSBC International Trustee, requesting it to only obey instructions that had received 51 percent or more of the vote cast by the board, but the trustee did not face it squarely, she said.
HSBC's lawyer, Paul Girolami, QC, revealed that the family discussed the allocation of the trust's assets in a meeting on November 27, 2015.
At the meeting, the trustee's representative Paulina Lau Sin-yee reiterated that they can exercise a wide range of powers. For some restricted powers, they only need to notify to appointor 30 days before execution.
The court was told that the matriarch confirmed that the contents of the letter of wishes signed in 1988 remained the same and hoped that the trust will distribute HK$500 million to the beneficiaries.
But Lo To said she had no idea it had happened. Even if it did happen, she said, she would have not remembered it clearly due to old age. "What I had [for dinner] last night, I can't even remember it today,” she said.
In the matriarch's statements, she said Lo Ka-shui's threatening speeches seriously breached the wish of her and her late husband, Great Eagle founder Lo Ying-shek.
The couple's wish is that company decisions can only be made after all children have discussed, instead of an individual making the decisions.
At the court, Lo To explained: "[Their] father's will is that they need to protect Great Eagle as a group, and decisions are made by all brothers and sisters.”
She also said in her statements that if she had not act, Lo Ka-shui would have united with fifth son, Lo Ying-sui, and could easily control Great Eagle on their own.
Girolami asked the matriarch why she had such thoughts. "It's a thought, not reality. If it's true then both of them can hold all the shareholders' rights in Great Eagle,” Lo To said.