FUNG TIN YAU v. FUNG TIN SHING AND OTHERS

FUNG TIN YAU v. FUNG TIN SHING AND OTHERS

The Court dismissed all three sets of appeals: the 2078 strike out appeal failed because the counterclaim alleging assumption of fiduciary duties disclosed a reasonable cause of action and was not plainly unsustainable; the O.14 summary judgment appeals (HCA 2998-3000) failed because genuine disputes of fact (Consensus vs Withdrawal/Wyse Agreements) and issues of credibility precluded summary disposal and leave to defend was granted without conditions; the 133/136 strike out appeals failed because a prima facie case of 'fraud on the minority' was established and alternative remedies or allegations of unclean hands did not justify striking out the derivative claims.

Citation
[2020] HKCFI 252
Parties
Petitioner / Plaintiff / Defendant (consolidated): Fung Tin Yau (馮天佑); Plaintiff / 1st Plaintiff / 1st Defendant (various Actions): Lai Ng Nui (賴五女); 2nd Respondent / Defendant / 5th Defendant (various Actions): Fung Wing See (馮穎思); 1st Respondent / Defendant (various Actions): Fung Tin Shing (馮天承); Plaintiff / Company Defendant (consolidated): Maxfortune Trading Limited; Plaintiff / Company Defendant (consolidated): Premium Management Limited; Plaintiff / Company Defendant (consolidated): Wyse Investment Limited; 3rd Respondent / Company (winding Up Petition): Great Anchor International Limited; 3rd Defendant / Company (derivative Action): Samdor Company Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
23 January 2020
Case Number
HCCW172/2016
Procedural Posture
Consolidated Interlocutory Appeals in Companies (winding Up) and Related Civil Actions / Appeal From Masters' Interlocutory Rulings Heard Before the Companies Judge (interlocutory Stage)
Outcome
All three sets of appeals dismissed; leave to defend granted where applicable; matters to proceed to trial on merits
Legal Topics
Derivative Action, Fiduciary Duties / Ad Hoc Fiduciary Relationships, Strike Out (order 18), Summary Judgment (o.14), Duomatic Principle, Estoppel, Limitation
Source Language
EN
Company Law Equity and Trusts Civil Procedure Insolvency (winding Up) Derivative Action Fiduciary Duties / Ad Hoc Fiduciary Relationships Strike Out (order 18) Summary Judgment (o.14) +3 more

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Parties

Fung Tin Yau (馮天佑)

Petitioner / Plaintiff / Defendant (consolidated)

Lai Ng Nui (賴五女)

Plaintiff / 1st Plaintiff / 1st Defendant (various Actions)

Fung Wing See (馮穎思)

2nd Respondent / Defendant / 5th Defendant (various Actions)

Fung Tin Shing (馮天承)

1st Respondent / Defendant (various Actions)

Maxfortune Trading Limited

Plaintiff / Company Defendant (consolidated)

Premium Management Limited

Plaintiff / Company Defendant (consolidated)

Wyse Investment Limited

Plaintiff / Company Defendant (consolidated)

Great Anchor International Limited

3rd Respondent / Company (winding Up Petition)

Samdor Company Limited

3rd Defendant / Company (derivative Action)

Procedural Posture

Consolidated Interlocutory Appeals in Companies (winding Up) and Related Civil Actions / Appeal From Masters' Interlocutory Rulings Heard Before the Companies Judge (interlocutory Stage)

Legal Issues

  1. 1 Whether counterclaim alleging assumption of fiduciary duties disclosed reasonable cause of action for striking out
  2. 2 Whether summary judgment appropriate against defendant given disputed oral agreements and factual issues
  3. 3 Whether derivative actions fall within exception to Foss v Harbottle (fraud on the minority)

Ratio Decidendi

The Court dismissed all three sets of appeals: the 2078 strike out appeal failed because the counterclaim alleging assumption of fiduciary duties disclosed a reasonable cause of action and was not plainly unsustainable; the O.14 summary judgment appeals (HCA 2998-3000) failed because genuine disputes of fact (Consensus vs Withdrawal/Wyse Agreements) and issues of credibility precluded summary disposal and leave to defend was granted without conditions; the 133/136 strike out appeals failed because a prima facie case of 'fraud on the minority' was established and alternative remedies or allegations of unclean hands did not justify striking out the derivative claims.

Court Disposition

All three sets of appeals dismissed; leave to defend granted where applicable; matters to proceed to trial on merits

Orders

  • Appeals dismissed
  • Respondent entitled to costs of all three sets of appeals to be taxed if not agreed