FUNG TIN YAU v. FUNG TIN SHING AND OTHERS

FUNG TIN YAU v. FUNG TIN SHING AND OTHERS

All three sets of appeals dismissed: the 2078 counterclaim disclosed a reasonable cause of action based on assumed/ad hoc fiduciary duties and was not plainly frivolous or an abuse; the 2998-3000 defences raised bona fide factual disputes (Withdrawal/Wyse Agreements and Consensus) defeating Order 14 summary judgment and precluding conditional leave or strike out; the 133/136 derivative claims established a prima facie fraud‑on‑the‑minority exception and were not struck out for alternative remedy or clean hands; leave to defend granted and costs awarded to the Respondent subject to taxation.

Citation
[2020] HKCFI 252
Parties
Respondent / Plaintiff / Petitioner: Fung Tin Yau; Appellant / Plaintiff / Defendant: Lai Ng Nui; Appellant / Defendant: Fung Tin Shing; Appellant / Defendant: Fung Wing See; Appellant / Plaintiff: Maxfortune Trading Limited; Appellant / Plaintiff: Premium Management Limited; Appellant / Plaintiff: Wyse Investment Limited; Respondent / Company: Great Anchor International Limited; Respondent / Company: Samdor Company Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
23 January 2020
Case Number
HCCW170/2016
Procedural Posture
Consolidated Companies (winding Up) and Related Civil Actions With Master Appeals / Hearing of Appeals Against Strike Out and Summary Judgment Decisions Before Companies Judge; Judgment Delivered
Outcome
Dismissal of all three sets of appeals; counterclaim and defences to proceed to trial; costs awarded to Respondent (to be taxed if not agreed)
Legal Topics
Derivative Actions, Fiduciary Duties (ad Hoc), Constructive Trust, Strike Out (order 18), Summary Judgment (order 14), Duomatic Principle, Fraud on the Minority, Limitation
Source Language
EN
Company Law Equity and Trusts Civil Procedure Insolvency Law Derivative Actions Fiduciary Duties (ad Hoc) Constructive Trust Strike Out (order 18) +4 more

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Parties

Fung Tin Yau

Respondent / Plaintiff / Petitioner

Lai Ng Nui

Appellant / Plaintiff / Defendant

Fung Tin Shing

Appellant / Defendant

Fung Wing See

Appellant / Defendant

Maxfortune Trading Limited

Appellant / Plaintiff

Premium Management Limited

Appellant / Plaintiff

Wyse Investment Limited

Appellant / Plaintiff

Great Anchor International Limited

Respondent / Company

Samdor Company Limited

Respondent / Company

Procedural Posture

Consolidated Companies (winding Up) and Related Civil Actions With Master Appeals / Hearing of Appeals Against Strike Out and Summary Judgment Decisions Before Companies Judge; Judgment Delivered

Legal Issues

  1. 1 Whether the 2078 counterclaim discloses a reasonable cause of action based on assumed fiduciary duties
  2. 2 Whether the 2078 counterclaim is frivolous, vexatious or an abuse of process
  3. 3 Whether summary judgments against the Respondent in HCA 2998-3000 should have been entered (Order 14)

Ratio Decidendi

All three sets of appeals dismissed: the 2078 counterclaim disclosed a reasonable cause of action based on assumed/ad hoc fiduciary duties and was not plainly frivolous or an abuse; the 2998-3000 defences raised bona fide factual disputes (Withdrawal/Wyse Agreements and Consensus) defeating Order 14 summary judgment and precluding conditional leave or strike out; the 133/136 derivative claims established a prima facie fraud‑on‑the‑minority exception and were not struck out for alternative remedy or clean hands; leave to defend granted and costs awarded to the Respondent subject to taxation.

Court Disposition

Dismissal of all three sets of appeals; counterclaim and defences to proceed to trial; costs awarded to Respondent (to be taxed if not agreed)

Orders

  • All 3 sets of appeals dismissed
  • Respondent to have costs of all 3 sets of appeals; costs of 2078 appeal to be borne by Madam Lai and Jenny; costs of 2998-3000 appeals to be borne by Maxfortune, Wyse and Premium respectively; costs of 133/136 appeals to be borne by Madam Lai, Jenny and Andy