DRAGON SUCCESS ENTERPRISE LTD v. AESO HOLDING LTD

Parties

Procedural Posture

Civil: Company Dispute Concerning Loan Facility, Share Charge, Mareva Injunction and Counterclaim / Interlocutory/applications to Continue or Discharge Mareva Injunction and Ancillary Disclosure (return Hearings; Directions for Further Interlocutory Argument)

Legal Issues

1. 1 Whether the Mareva (freezing) injunction against the 2nd and 3rd defendants should be continued or discharged
2. 2 Whether plaintiffs committed material non-disclosure at ex parte hearing
3. 3 Whether there is a good arguable case of conspiracy/fraud to strip the company of its sole operating subsidiary

Ratio Decidendi

At interlocutory stage the court found plaintiffs had a good arguable case against Chan for breach of directors' fiduciary and common law duties, assets existed within jurisdiction and a real risk of dissipation could be inferred from non-compliance with disclosure orders; accordingly the Mareva injunction and ancillary disclosure were continued against Chan (with the monetary cap amended to HK$28,798,000) but the Mareva and preservation orders were discharged as against Cheung for lack of sufficient evidence of risk or involvement; preservation order against Chan was discharged due to lack of proprietary basis; Loan Proceeds Disclosure Order was not revived and the disclosure summons was...

Court Disposition

Interlocutory: Mareva injunction and ancillary disclosure continued against Chan limited to HK$28,798,000; Mareva and preservation orders discharged as to Cheung; preservation order paragraph discharged as to Chan; disclosure summons adjourned with directions; costs reserved to the cause with certificate for two...

Orders

• Continue paragraphs 2(1), 2(2), 2(4) and 2(5) of the 24.07.17 Injunction Order as against Chan, amended to HK$28,798,000
• Grant Ancillary Disclosure Order against Chan: disclose all assets of individual value HK$10,000+ within 7 days and affirmation within 14 days