Hong Kong Int’l School and US church founder reach settlement over financial mismanagement lawsuit

Hong Kong International School (HKIS) and its US-based founder have reached an out-of-court settlement, after the latter sued the school last year for alleged financial mismanagement and over accusations it served only an “elite” section of the city’s population.

Hong Kong International School’s Lower Primary campus in Repulse Bay. Photo: HKIS.

The school will no longer be governed by its founder, The Lutheran Church—Missouri Synod (LCMS), but will continue to provide an “American-style education grounded in the Christian faith,” a letter sent to parents on Tuesday read.

HKIS board of managers chairperson Harold Kim, who wrote the letter, said the school remained in a strong financial position and the settlement would not affect tuition fees.

The latest development brings to a close a lawsuit filed by the LCMS at the High Court in September last year. While the major US church body originally entered Hong Kong in 1949 to provide services for the local community, in particular mainland Chinese refugees, it later expanded its role and founded HKIS in 1966 to target expatriate families.

Today, HKIS has two campuses, one in Repulse Bay and another in Tai Tam, and is known for providing an American-style curriculum.

The High Court. File photo: Kyle Lam/HKFP.

LCMS sued Hong Kong International School Association Limited (HKISAL) – the school’s operator – over “serious concerns” regarding its finances and what the church deemed to be transparency and leadership issues.

HKIS holds more than HK$2.8 billion in financial reserves and serves “only a small, elite section of Hong Kong,” going against the school’s original mission of being open to “all children,” the LCMS said then.

‘Uncertainty and anxiety’

In the email to parents on Tuesday, Harold Kim said the school acknowledged the LCMS’s role in the founding of HKIS, as well as its contribution to establishing the Christian identity that continues to shape HKIS.

“The past 11 months have brought uncertainty and anxiety to our community, and we are grateful for the support of and trust in HKIS that you have shown throughout this period,” Kim wrote.

In an FAQ for parents, the school stated that the lease for the Repulse Bay campus was still in the LCMS’s name, but that procedures were underway for the lease to be transferred to HKISAL.

Hong Kong International School’s Tai Tam campus. Photo: Cyril Ha/Google Maps.

When the LCMS filed the lawsuit, there was concern that the school could potentially be evicted from its Repulse Bay campus. The Tai Tam campus lease is held by HKISAL.

The LCMS will also no longer pursue the establishment of Hong Kong Pacific School. The body had said earlier that it would set up a new school by that name if HKISAL failed to address its concerns. A website that was previously set up for Hong Kong Pacific School is no longer accessible.

In a statement published on Monday, the LCMS confirmed that the dispute with HKISAL had been resolved with the church group “recouping a monetary reflection of its historical inputs to the school in order to advance the mission of the church by other means.”

“The outcome provides a fair resolution to the concerns the LCMS has raised for many years. It also enables the LCMS to pursue its mission unencumbered by the dispute with HKISAL, so that we can best utilize our resources going forward,” said LCMS Board of Directors Chair Christian Preus.