CHEN HA PING HEPBURN also known as CHEN HA PING CHEN TING HOI also known as CHEN HOI AND ANOTHER v. CHEN TING SAN DANIEL also known as CHEN TING SAN and DANIEL CHEN AND OTHERS

CHEN HA PING HEPBURN also known as CHEN HA PING CHEN TING HOI also known as CHEN HOI AND ANOTHER v. CHEN TING SAN DANIEL also known as CHEN TING SAN and DANIEL CHEN AND OTHERS

The court granted leave because the proposed alternative claim constituted a bona fide cause of action, satisfied the low threshold of a serious question to be tried and was not demurrable or plainly without substance; potential conflicts of interest were not a bar because all interested parties would be before the court and there was no material disadvantage to the company, so it was in the company's interests to grant leave.

Citation
[2018] HKCFI 2289
Parties
1st Applicant: Chen Ha Ping Hepburn; 2nd Applicant: Chen Ting Hoi; 1st Respondent: Chen Ting San Daniel; 2nd Respondent: Chen Ting Nam; 3rd Respondent: Leeloong Investment Company Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
7 September 2018
Case Number
HCMP86/2018
Procedural Posture
Section 732 Companies Ordinance Derivative Action Application / Leave Application Decided on Originating Summons in Chambers
Outcome
Leave granted under section 732 for the applicants to bring the proposed derivative/alternative claim on behalf of Leeloong Investment Company Limited
Legal Topics
Statutory Derivative Action, Leave to Bring Proceedings, Cause of Action, Beneficial Ownership, Conflict of Interest, Serious Question to Be Tried
Source Language
EN
Company Law Civil Procedure Trusts Property Law Statutory Derivative Action Leave to Bring Proceedings Cause of Action Beneficial Ownership +2 more

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Parties

Chen Ha Ping Hepburn

1st Applicant

Chen Ting Hoi

2nd Applicant

Chen Ting San Daniel

1st Respondent

Chen Ting Nam

2nd Respondent

Leeloong Investment Company Limited

3rd Respondent

Procedural Posture

Section 732 Companies Ordinance Derivative Action Application / Leave Application Decided on Originating Summons in Chambers

Legal Issues

  1. 1 Whether leave under section 732 should be granted to bring the proposed derivative/alternative claim on behalf of Leeloong
  2. 2 Whether the proposed alternative claim constitutes a cause of action within s732
  3. 3 Whether the Serious Question Requirement is met

Ratio Decidendi

The court granted leave because the proposed alternative claim constituted a bona fide cause of action, satisfied the low threshold of a serious question to be tried and was not demurrable or plainly without substance; potential conflicts of interest were not a bar because all interested parties would be before the court and there was no material disadvantage to the company, so it was in the company's interests to grant leave.

Court Disposition

Leave granted under section 732 for the applicants to bring the proposed derivative/alternative claim on behalf of Leeloong Investment Company Limited

Orders

  • Leave granted to bring the proposed derivative/alternative claim on behalf of Leeloong Investment Company Limited
  • The question of the applicants' indemnification for Leeloong's costs of the High Court Action is adjourned