Relevant employees whose shares in China Shanshui Investment Company Limited held by ZHANG CAIKUI on trust (Please refer to Schedule 1 attached to the Writ of Summons for names of the relevant employees) AND ANOTHER v. ZHANG CAIKUI AND ANOTHER

Relevant employees whose shares in China Shanshui Investment Company Limited held by ZHANG CAIKUI on trust (Please refer to Schedule 1 attached to the Writ of Summons for names of the relevant employees) AND ANOTHER v. ZHANG CAIKUI AND ANOTHER

The application was dismissed because the applicants failed to meet the heavy onus required to justify court intervention: no evidence of lack of good faith or legal error by the receivers; the general mandate had not been exercised in the alleged prejudicial manner; the receivers gave an undertaking not to vote to...

Source-derived case information.

Citation
Relevant employees whose shares in China Shanshui Investment Company Limited held by ZHANG CAIKUI on trust (Please refer to Schedule 1 attached to the Writ of Summons for names of the relevant employees) AND ANOTHER v. ZHANG CAIKUI AND ANOTHER
Parties
Applicants: Five Plaintiffs; Receivers: Receivers; Defendant: 1st Defendant; Plaintiffs: Plaintiffs represented by K&L Gates
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
14 June 2017
Case Number
HCA939/2015
Procedural Posture
Urgent Interlocutory Application for Directions to Court Appointed Receivers / Hearing in Chambers on Urgent Application (interlocutory)
Outcome
Application dismissed with costs; certificate for two counsel for the receivers.
Legal Topics
Direction to Receivers, General Mandate to Allot Shares, Share Dilution, Conflict of Interest of Receivers, Adjournment of AGM, Removal of Receivers
Source Language
en
Company Law Corporate Governance Receivership Shareholder Rights Injunctions/interlocutory Relief Direction to Receivers General Mandate to Allot Shares Share Dilution +3 more

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Parties

Five Plaintiffs

Applicants

Receivers

Receivers

1st Defendant

Defendant

Plaintiffs represented by K&L Gates

Plaintiffs

Procedural Posture

Urgent Interlocutory Application for Directions to Court Appointed Receivers / Hearing in Chambers on Urgent Application (interlocutory)

Legal Issues

  1. 1 Whether the court should direct receivers to vote shares held in receivership at CSCG AGM
  2. 2 Whether receivers have a conflict of duties between CSI and CSCG requiring court intervention
  3. 3 Whether the grant or proposed exercise of a general mandate to allot shares justifies court directions

Ratio Decidendi

The application was dismissed because the applicants failed to meet the heavy onus required to justify court intervention: no evidence of lack of good faith or legal error by the receivers; the general mandate had not been exercised in the alleged prejudicial manner; the receivers gave an undertaking not to vote to dilute CSI; and the matter could be addressed by shareholders at general meeting or in the pending removal application.

Court Disposition

Application dismissed with costs; certificate for two counsel for the receivers.

Orders

  • Application dismissed with costs
  • Certificate for two counsel for the receivers