KIM SIE JOONG AND ANOTHER v. NG CHEUK NGON AND OTHERS

KIM SIE JOONG AND ANOTHER v. NG CHEUK NGON AND OTHERS

The strike‑out application was dismissed: on the pleadings the plaintiffs have disclosed a reasonable cause of action under the derivative exception to Foss v. Harbottle in respect of the 1st defendant’s purchase of Rich City’s debt because it likely constituted a corporate opportunity and a breach of fiduciary duty; although the share purchase issue is less clear it is not plain and obvious that no case exists; paragraphs require amendment to state the debt was that of Rich City and not Billion Market.

Citation
KIM SIE JOONG AND ANOTHER v. NG CHEUK NGON AND OTHERS
Parties
1st Plaintiff: KIM SIE JOONG; 2nd Plaintiff: LAU FAI SHUN; 1st Defendant: NG CHEUK NGON; 2nd Defendant: TSOU SHING HING; 3rd Defendant: MADAM CHEUNG YIN YUNG; 4th Defendant: BILLION MARKET LTD; 5th Defendant: NG CHEUK TING; 6th Defendant: SHEK YUET SAU; 7th Defendant: LAW KWAI KAU
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
18 November 2003
Case Number
HCA552/2002
Procedural Posture
Shareholder Derivative Action / Company Law Dispute / Application to Strike Out Pleadings Under Order 18 R.19 (no Reasonable Cause of Action)
Outcome
Application to strike out dismissed
Legal Topics
Derivative Action, Fiduciary Duty of Directors, Constructive Trust, Unfairly Prejudicial Conduct (s.168 A), Strike Out (no Reasonable Cause), Quasi‑partnership
Source Language
EN
Company Law Equity and Trusts Civil Procedure Derivative Action Fiduciary Duty of Directors Constructive Trust Unfairly Prejudicial Conduct (s.168 A) Strike Out (no Reasonable Cause) +1 more

Case Brief

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 10 Party arguments 2 Amounts and remedies 5
Sign in to unlock

Parties

KIM SIE JOONG

1st Plaintiff

LAU FAI SHUN

2nd Plaintiff

NG CHEUK NGON

1st Defendant

TSOU SHING HING

2nd Defendant

MADAM CHEUNG YIN YUNG

3rd Defendant

BILLION MARKET LTD

4th Defendant

NG CHEUK TING

5th Defendant

SHEK YUET SAU

6th Defendant

LAW KWAI KAU

7th Defendant

Procedural Posture

Shareholder Derivative Action / Company Law Dispute / Application to Strike Out Pleadings Under Order 18 R.19 (no Reasonable Cause of Action)

Legal Issues

  1. 1 Whether paragraphs 44–46 and parts of the prayer disclose a reasonable cause of action
  2. 2 Whether the assignment/purchase of Rich City debt by a director constituted a corporate opportunity and breach of fiduciary duty
  3. 3 Whether the minority derivative action exception to Foss v Harbottle applies

Ratio Decidendi

The strike‑out application was dismissed: on the pleadings the plaintiffs have disclosed a reasonable cause of action under the derivative exception to Foss v. Harbottle in respect of the 1st defendant’s purchase of Rich City’s debt because it likely constituted a corporate opportunity and a breach of fiduciary duty; although the share purchase issue is less clear it is not plain and obvious that no case exists; paragraphs require amendment to state the debt was that of Rich City and not Billion Market.

Court Disposition

Application to strike out dismissed

Orders

  • Application to strike out paragraphs 44–46 of the Statement of Claim and paragraphs (b)–(d) of the prayer refused
  • Pleadings to be amended to make clear that the debt alleged was that of Rich City and not Billion Market