LIU HAO TSING EDUCATION FOUNDATION LTD AND ANOTHER v. LIU TIEH CHING BRANDON (also known as LAU TIT SHING)

LIU HAO TSING EDUCATION FOUNDATION LTD AND ANOTHER v. LIU TIEH CHING BRANDON (also known as LAU TIT SHING)

The court held it was not a plain and obvious case to strike-out the petition on the ground that the Statement was enforceable to bar the petition; the enforceability raised non‑trivial legal and public policy issues and required fuller determination. However, the court struck out specific reliefs that were clearly unsustainable: the primary relief for distribution of assets in specie (paragraph 132 and Prayer 1) and the alternative winding-up averments (paragraphs 136–138 and Prayer 5) as obviously inappropriate on the pleaded facts, and struck out the petition as against the 3rd and 4th respondents for lack of proper basis to join them.

Citation
[2021] HKCFI 823
Parties
Petitioner/defendant: LIU TIEH CHING BRANDON; 1st Respondent: LIU JU CHING; 2nd Respondent: LIU YIU CHING; 3rd Respondent: LING SIU KWONG; 4th Respondent: LIU SHEN PO; 5th Respondent/1st Plaintiff: LIU HAO TSING EDUCATION FOUNDATION LIMITED; 6th Respondent: OVERSEAS ASSOCIATES LIMITED; 2nd Plaintiff: LIU JU TSING
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
31 March 2021
Case Number
HCA931/2019
Procedural Posture
Companies Winding Up Petition and Related Shareholder Action (hccw 109/2019 & HCA 931/2019) / Decision in Chambers After Hearing (strike Out and Stay Applications)
Outcome
Partial strike-out of petition and dismissal of some strike-out applications; principal strike-out applications on Statement and derivative grounds dismissed; stay applications adjourned sine die with liberty to restore.
Legal Topics
Unfairly Prejudicial Conduct Petitions, Winding Up Petitions, Derivative Actions Vs Personal Remedies, Strike Out Applications, Enforceability of Conditions on Share Transfers, Procedure for Advertisement of Petitions (rule 24)
Source Language
EN
Company Law Civil Procedure Equity Trusts and Succession Unfairly Prejudicial Conduct Petitions Winding Up Petitions Derivative Actions Vs Personal Remedies Strike Out Applications +2 more

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Parties

LIU TIEH CHING BRANDON

Petitioner/defendant

LIU JU CHING

1st Respondent

LIU YIU CHING

2nd Respondent

LING SIU KWONG

3rd Respondent

LIU SHEN PO

4th Respondent

LIU HAO TSING EDUCATION FOUNDATION LIMITED

5th Respondent/1st Plaintiff

OVERSEAS ASSOCIATES LIMITED

6th Respondent

LIU JU TSING

2nd Plaintiff

Procedural Posture

Companies Winding Up Petition and Related Shareholder Action (hccw 109/2019 & HCA 931/2019) / Decision in Chambers After Hearing (strike Out and Stay Applications)

Legal Issues

  1. 1 Whether a statement restricting a transferee shareholder from commencing proceedings is enforceable or void as repugnant or against public policy
  2. 2 Whether the petition should be struck out as an abuse for breach of the Statement
  3. 3 Whether early advertisement contrary to Rule 24 constitutes abuse justifying strike-out

Ratio Decidendi

The court held it was not a plain and obvious case to strike-out the petition on the ground that the Statement was enforceable to bar the petition; the enforceability raised non‑trivial legal and public policy issues and required fuller determination. However, the court struck out specific reliefs that were clearly unsustainable: the primary relief for distribution of assets in specie (paragraph 132 and Prayer 1) and the alternative winding-up averments (paragraphs 136–138 and Prayer 5) as obviously inappropriate on the pleaded facts, and struck out the petition as against the 3rd and 4th respondents for lack of proper basis to join them.

Court Disposition

Partial strike-out of petition and dismissal of some strike-out applications; principal strike-out applications on Statement and derivative grounds dismissed; stay applications adjourned sine die with liberty to restore.

Orders

  • Paragraph 132 of the Petition and Prayer 1 struck-out (order for distribution of assets in specie)
  • Paragraphs 136 to 138 of the Petition and Prayer 5 struck-out (winding-up relief)