TAM WING YUEN AND ANOTHER v. SIBERIAN MINING GROUP CO LTD AND OTHERS

TAM WING YUEN AND ANOTHER v. SIBERIAN MINING GROUP CO LTD AND OTHERS

The plaintiffs' claims are in substance derivative; they failed to establish a prima facie case that the Company would be likely to succeed in setting aside CN3 (the HASS report satisfied clause 4.4 and corroborating evidence existed), no applicable exception to Foss v Harbottle was made out, and no Cayman leave had been obtained; accordingly the statement of claim is struck out as against the SMG defendants and dismissed.

Citation
TAM WING YUEN AND ANOTHER v. SIBERIAN MINING GROUP CO LTD AND OTHERS
Parties
1st Plaintiff: TAM WING YUEN; 2nd Plaintiff: CHOW DOI YIK CANIEL; 1st Defendant: SIBERIAN MINING GROUP COMPANY LIMITED; 2nd Defendant: GRANDVEST INTERNATIONAL LIMITED; 3rd Defendant: CORDIA GLOBAL LIMITED; 4th Defendant: CHOI SUNGMIN; 5th Defendant: LIM HO SOK; 6th Defendant: CHOI JUN HO; 7th Defendant: PANG NGOI WAH EDWARD; 8th Defendant: CHO MIN JE; 9th Defendant: LIEW SWEE YEAN; 10th Defendant: TAM TAK WAH; 11th Defendant: YOUNG YUE WING ALVIN; 12th Defendant: DAILY LOYAL LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
4 October 2016
Case Number
HCA2694/2015
Procedural Posture
Shareholder Derivative / Declaratory Action Arising From Issuance of Convertible Note (strike Out Application) / Strike Out Summons Heard and Judgment Striking Out Statement of Claim as Against SMG Defendants
Outcome
Statement of claim struck out as against the SMG defendants and dismissed
Legal Topics
Derivative Action, Rule in Foss V Harbottle, Leave to Sue (cayman), Declaratory Relief, Strike Out for Want of Locus, Convertible Notes and Share Conversion, Costs (indemnity)
Source Language
EN
Company Law Civil Procedure Securities Law Contract Law Derivative Action Rule in Foss V Harbottle Leave to Sue (cayman) Declaratory Relief +3 more

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Parties

TAM WING YUEN

1st Plaintiff

CHOW DOI YIK CANIEL

2nd Plaintiff

SIBERIAN MINING GROUP COMPANY LIMITED

1st Defendant

GRANDVEST INTERNATIONAL LIMITED

2nd Defendant

CORDIA GLOBAL LIMITED

3rd Defendant

CHOI SUNGMIN

4th Defendant

LIM HO SOK

5th Defendant

CHOI JUN HO

6th Defendant

PANG NGOI WAH EDWARD

7th Defendant

CHO MIN JE

8th Defendant

LIEW SWEE YEAN

9th Defendant

TAM TAK WAH

10th Defendant

YOUNG YUE WING ALVIN

11th Defendant

DAILY LOYAL LIMITED

12th Defendant

Procedural Posture

Shareholder Derivative / Declaratory Action Arising From Issuance of Convertible Note (strike Out Application) / Strike Out Summons Heard and Judgment Striking Out Statement of Claim as Against SMG Defendants

Legal Issues

  1. 1 Whether the plaintiffs’ claims are in substance derivative and require leave under Cayman law
  2. 2 Whether the plaintiffs established a prima facie case that the Company would be entitled to relief (so an exception to Foss v Harbottle applies)
  3. 3 Whether the issuance of CN3 satisfied clause 4.4 (technical report confirming certified reserve)

Ratio Decidendi

The plaintiffs' claims are in substance derivative; they failed to establish a prima facie case that the Company would be likely to succeed in setting aside CN3 (the HASS report satisfied clause 4.4 and corroborating evidence existed), no applicable exception to Foss v Harbottle was made out, and no Cayman leave had been obtained; accordingly the statement of claim is struck out as against the SMG defendants and dismissed.

Court Disposition

Statement of claim struck out as against the SMG defendants and dismissed

Orders

  • Statement of claim struck out as against the 1st, 2nd, 5th, 7th, 9th, 10th and 11th defendants and dismissed
  • Order nisi that the plaintiffs pay the costs of the SMG defendants on an indemnity basis