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Gillian Lam

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Gillian Lam is an associate in Baker McKenzie Hong Kong office.

We have seen a noticeable increase in the prevalence and sophistication of cyber fraud incidents in recent years. This has led to a substantial rise in civil recovery actions, and as a result, we now have the benefit of key learnings from recent decisions by the Hong Kong Courts and other jurisdictions. This alert discusses some of the common themes and challenges victims of fraud may face in civil recovery actions, particularly in cases involving allegedly “innocent” recipients of tainted funds and competing victims pursuing recovery from the same finite pool of funds.

A recent High Court decision in Yung Wai Tak Abraham William v. Natural Dairy (Nz) Holdings Ltd (in Provisional Liquidation) (17/08/2020, HCLA26/2018) [2020] HKCFI 2067 (“Decision”) held that a Hong Kong listed company and its wholly owned subsidiary were joint employers of the appellant whose main job was to serve the listed company as its company secretary, notwithstanding that the written employment contract was solely made with the subsidiary. The parent company was held liable for, inter alia, unpaid wages, statutory severance payment and payment in lieu of notice owed to the appellant by the subsidiary. In coming to its conclusion, the court applied the “overall impression” test set down by the Court of Final Appeal in Poon Chau Nam v Yim Siu Cheung,1 taking into account all relevant features of the parties’ relationship, including the proper interpretation of the written employment contract, the recruitment process, the services provided by the employee to the companies involved, the employer’s confession, and other contemporaneous documentary evidence.

In brief With the slowdown in economic activity globally due to COVID-19, the number of cyber fraud cases from around the world has surged. The Hong Kong Police, the Action Fraud (UK’s National Fraud & Cyber Crime Reporting Centre), and the Australian Cyber Security Centre, have all recorded a significant…