LONG HAI HONG (龍海紅) the administratrix of the estate of LEE SO WINSTON (李甦), deceased v. LIU DAN AND ANOTHER

LONG HAI HONG (龍海紅) the administratrix of the estate of LEE SO WINSTON (李甦), deceased v. LIU DAN AND ANOTHER

The court found a substantial overlap of the real issues (beneficial ownership, nominee arrangements, source of investment and relationships among key protagonists) and a substantial overlap of parties and witnesses; consolidation was not premature given pleadings and witness affirmations already filed; no real conflict of interest or unfair prejudice demonstrated; therefore summary order to try the four actions together was justified as sound case management to save time and costs and avoid inconsistent findings.

Citation
[2022] HKCFI 339
Parties
Applicant/plaintiff (also Administratrix of the Estate of Lee So Winston): Long Hai Hong; 1st Respondent / Defendant: Chan Yu, Lydia; 2nd Respondent / 5th Defendant: A J K Company Limited; 3rd Respondent / 1st Defendant: Liu Dan; 2nd Defendant: Xing Zhirong; 4th Defendant: China Terry Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
28 January 2022
Case Number
HCA1537/2019
Procedural Posture
Multiple Related Civil Actions Concerning Company/shareholder Disputes, Derivative and Partnership Claims With Consolidation Application / Case Management: Application to Try Four Actions Together Granted; Directions for Consolidated Trial Ordered
Outcome
Summons granted: the four actions (HCMP 3179/2013; HCA 175/2018; HCA 721/2019; HCA 1537/2019) are to be tried together before one judge.
Legal Topics
Consolidation/trial Together, Rectification of Register of Members, Derivative Claim, Constructive Trust/nominee Arrangements, Partnership Dissolution and Accounting, Disputed Beneficial Ownership of Shares, Case Management Under Civil Justice Reform
Source Language
EN
Company Law Civil Procedure Trusts and Fiduciary Obligations Partnership Law Succession/estate Administration Consolidation/trial Together Rectification of Register of Members Derivative Claim +4 more

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Parties

Long Hai Hong

Applicant/plaintiff (also Administratrix of the Estate of Lee So Winston)

Chan Yu, Lydia

1st Respondent / Defendant

A J K Company Limited

2nd Respondent / 5th Defendant

Liu Dan

3rd Respondent / 1st Defendant

Xing Zhirong

2nd Defendant

China Terry Limited

4th Defendant

Procedural Posture

Multiple Related Civil Actions Concerning Company/shareholder Disputes, Derivative and Partnership Claims With Consolidation Application / Case Management: Application to Try Four Actions Together Granted; Directions for Consolidated Trial Ordered

Legal Issues

  1. 1 Whether the four separate actions should be tried together
  2. 2 Whether the disputed 940,000 shares (Disputed Shares) were beneficially owned by Winston or by Liu prior to the 2011 transfer
  3. 3 Whether the 2011 transfer to Long constituted a gift to Long and if the 2013 transfer back to Liu affected Long's beneficial ownership

Ratio Decidendi

The court found a substantial overlap of the real issues (beneficial ownership, nominee arrangements, source of investment and relationships among key protagonists) and a substantial overlap of parties and witnesses; consolidation was not premature given pleadings and witness affirmations already filed; no real conflict of interest or unfair prejudice demonstrated; therefore summary order to try the four actions together was justified as sound case management to save time and costs and avoid inconsistent findings.

Court Disposition

Summons granted: the four actions (HCMP 3179/2013; HCA 175/2018; HCA 721/2019; HCA 1537/2019) are to be tried together before one judge.

Orders

  • The four actions are to be tried together before the same judge.
  • Case management directions to be given for consolidation of discovery and witness statements (one consolidated witness statement from each key witness).