HONG KONG HUIAN NATIVES ASSOCIATION LTD v. LOK TAI CHUEN AND ANOTHER

HONG KONG HUIAN NATIVES ASSOCIATION LTD v. LOK TAI CHUEN AND ANOTHER

The Master and the court properly found, on the available evidence, that the 2nd to 5th defendants were the prime movers who used the company to oppose the joinder application for the improper purpose of avoiding personal liability for legal costs; that improper purpose justified making a costs order against them under Order 62 r6A and s52A Cap.4, therefore the appeal is dismissed and the Master's costs order is upheld.

Citation
HONG KONG HUIAN NATIVES ASSOCIATION LTD v. LOK TAI CHUEN AND ANOTHER
Parties
Plaintiff (original Action); 1st Defendant (counterclaim): Hong Kong Huian Natives Association Limited; 1st Defendant (original Action); Plaintiff (counterclaim): Lok Tai Chuen; 2nd Defendant (original Action, Discontinued): Chan Boon Teong; 2nd Defendant (counterclaim): Lok Chi Hung; 3rd Defendant (counterclaim): Chan Kim Sing; 4th Defendant (counterclaim): Soen Lee Chan; 5th Defendant (counterclaim): One Choo Sway
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
7 January 2010
Case Number
HCA452/2008
Procedural Posture
Civil Company/corporate Dispute (directors/shareholders) / Appeal From Master's Costs Order; Judgment on Appeal
Outcome
Appeal dismissed; Master's costs order upheld.
Legal Topics
Joinder, Costs Orders Against Non‑parties, Piercing the Corporate Veil, Improper Purpose, Order 62 Rule 6 a, Section 52 a High Court Ordinance (cap.4)
Source Language
EN
Company Law Civil Procedure Costs Law Court Practice and Procedure Joinder Costs Orders Against Non‑parties Piercing the Corporate Veil Improper Purpose +2 more

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Parties

Hong Kong Huian Natives Association Limited

Plaintiff (original Action); 1st Defendant (counterclaim)

Lok Tai Chuen

1st Defendant (original Action); Plaintiff (counterclaim)

Chan Boon Teong

2nd Defendant (original Action, Discontinued)

Lok Chi Hung

2nd Defendant (counterclaim)

Chan Kim Sing

3rd Defendant (counterclaim)

Soen Lee Chan

4th Defendant (counterclaim)

One Choo Sway

5th Defendant (counterclaim)

Procedural Posture

Civil Company/corporate Dispute (directors/shareholders) / Appeal From Master's Costs Order; Judgment on Appeal

Legal Issues

  1. 1 Whether the Master was entitled to order costs against the 2nd to 5th defendants (directors)
  2. 2 Whether the 2nd to 5th defendants personally involved themselves in the joinder application
  3. 3 Whether the directors used the company for an improper purpose to avoid personal liability for costs

Ratio Decidendi

The Master and the court properly found, on the available evidence, that the 2nd to 5th defendants were the prime movers who used the company to oppose the joinder application for the improper purpose of avoiding personal liability for legal costs; that improper purpose justified making a costs order against them under Order 62 r6A and s52A Cap.4, therefore the appeal is dismissed and the Master's costs order is upheld.

Court Disposition

Appeal dismissed; Master's costs order upheld.

Orders

  • Appeal dismissed.
  • The Master's order dated 17 August 2009 that costs of the joinder application (including hearings on 23 December 2008 and 23 October 2008) be paid by the 2nd to the 5th defendants to the defendant in the original action (Hong Kong Huian Natives Association Limited) is upheld.