DONG CHENGTIAN AND ANOTHER v. CHONG CHA HWA AND OTHERS

DONG CHENGTIAN AND ANOTHER v. CHONG CHA HWA AND OTHERS

The court held that the chairman's rejection of valid proxies was unlawful and irrational, that in the context of repeated and systematic attempts to prevent shareholders exercising voting rights it was impracticable to conduct an EGM in accordance with the company’s articles, and that s570 therefore empowered the...

Source-derived case information.

Citation
[2018] HKCFI 1184
Parties
1st Petitioner: Dong Chengtian; 2nd Petitioner: Wang Yongping; 1st Respondent: Chong Cha Hwa; 2nd Respondent: Hwa Guo Wai Godwin; 3rd Respondent / 2nd Defendant (in HCMP 740): Zhao Yongkui; 4th Respondent: Ronominees Limited; 5th Respondent: Liu Yiu Keung Stephen (as Receiver); 6th Respondent: Yen Ching Wai David (as Receiver); 7th Respondent: Koo Chi Sum (as Receiver); 8th Respondent: Yeo Boon Ann (also known as Kenneth Yeo) (as Receiver); 9th Respondent: Kong Chi Ho Johnson (as Receiver); 10th Respondent / Plaintiff (in HCMP 740): Zhang Caikui; 11th Respondent / 1st Defendant (in HCMP 740): China Shanshui Investment Company Limited; Plaintiffs: Li Ming and others (Plaintiffs in HCA 1282/2017)
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
30 May 2018
Case Number
HCMP738/2018
Procedural Posture
Company/shareholder Disputes Under the Companies Ordinance (s570 and S724); Related Interlocutory Applications / Interim Hearing in Chambers for Urgent Directions, Injunction and Order for Court Convened EGM
Outcome
Order granted in part
Legal Topics
Companies Ordinance S570, Companies Ordinance S724, Proxy Validity and Disputes, Court Ordered General Meeting, Directors Removal, Unfair Prejudice
Source Language
en
Company Law Injunctions Civil Procedure Companies Ordinance S570 Companies Ordinance S724 Proxy Validity and Disputes Court Ordered General Meeting Directors Removal +1 more

Source-derived case record

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 5 Authorities cited 15 Party arguments 2 Amounts and remedies 4
Sign in to unlock

Parties

Dong Chengtian

1st Petitioner

Wang Yongping

2nd Petitioner

Chong Cha Hwa

1st Respondent

Hwa Guo Wai Godwin

2nd Respondent

Zhao Yongkui

3rd Respondent / 2nd Defendant (in HCMP 740)

Ronominees Limited

4th Respondent

Liu Yiu Keung Stephen (as Receiver)

5th Respondent

Yen Ching Wai David (as Receiver)

6th Respondent

Koo Chi Sum (as Receiver)

7th Respondent

Yeo Boon Ann (also known as Kenneth Yeo) (as Receiver)

8th Respondent

Kong Chi Ho Johnson (as Receiver)

9th Respondent

Zhang Caikui

10th Respondent / Plaintiff (in HCMP 740)

China Shanshui Investment Company Limited

11th Respondent / 1st Defendant (in HCMP 740)

Li Ming and others (Plaintiffs in HCA 1282/2017)

Plaintiffs

Procedural Posture

Company/shareholder Disputes Under the Companies Ordinance (s570 and S724); Related Interlocutory Applications / Interim Hearing in Chambers for Urgent Directions, Injunction and Order for Court Convened EGM

Legal Issues

  1. 1 Whether proxies presented to the EGM were valid and wrongly rejected by the chairman
  2. 2 Whether it was impracticable to conduct an EGM in accordance with the articles such that the court may order a meeting under s570 Companies Ordinance
  3. 3 Whether an interlocutory injunction should restrain existing directors from acting pending a court-ordered EGM

Ratio Decidendi

The court held that the chairman's rejection of valid proxies was unlawful and irrational, that in the context of repeated and systematic attempts to prevent shareholders exercising voting rights it was impracticable to conduct an EGM in accordance with the company’s articles, and that s570 therefore empowered the court to order a court-convened EGM. The court ordered an EGM on 20 May 2018 and granted an interlocutory injunction restraining the remaining directors (Chong and Zhao) from acting as directors pending that EGM, and gave ancillary directions including variation of directions to the EY Receivers.

Court Disposition

Order granted in part

Orders

  • Ordered a general meeting of China Shanshui Investment Company Limited to be held on 20 May 2018 under s570 Companies Ordinance with ancillary directions
  • Interim injunction restraining Chong Cha Hwa and Zhao Yongkui from acting as or holding themselves out as directors of China Shanshui Investment Company Limited pending the court-ordered EGM