YI CHUN NAVIGATION INC. v. LU WEN YUN, JENNY AND ANOTHER

YI CHUN NAVIGATION INC. v. LU WEN YUN, JENNY AND ANOTHER

On the evidence the court accepted that the challenged declarations legitimately referred to OOCL shares and that the Liyou shares allotted on capitalisation of US$1,500,000 belonged beneficially to Yi Chun/the Company. The judge found the petitionerʹs witnesses credible, rejected the respondentʹs accounts as unreliable and dishonest, accepted Dr Strachʹs expert opinion, rejected Mr Shumʹs methodology, and concluded the shares are held on trust for the company; costs awarded on an indemnity basis with certificate for two counsel.

Citation
YI CHUN NAVIGATION INC. v. LU WEN YUN, JENNY AND ANOTHER
Parties
Petitioner: Yi Chun Navigation Inc.; 1st Respondent: Lu Wen Yun, Jenny; 2nd Respondent: J&D Industrial (HK) Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
7 January 2011
Case Number
HCA2371/2005
Procedural Posture
Companies (winding‑up) No.565 of 2006; Action No.2371 of 2005 (derivative/shareholder Action) / Trial Judgment
Outcome
Judgment for Petitioner/Plaintiff: declarations granted that 350,000 OOCL shares held on trust for J&D Industrial (HK) Limited and that shares allotted to Madam Lu on capitalisation of US$1,500,000 in Liyou are held on trust for Yi Chun; costs to respondent on indemnity basis with certificate for two counsel.
Legal Topics
Declaration of Trust, Resulting Trust, Shareholder Dispute, Authenticity of Documents, Costs (indemnity)
Source Language
EN
Company Law Trusts Civil Procedure Evidence Forensic Handwriting Analysis Declaration of Trust Resulting Trust Shareholder Dispute +2 more

Case Brief

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Parties

Yi Chun Navigation Inc.

Petitioner

Lu Wen Yun, Jenny

1st Respondent

J&D Industrial (HK) Limited

2nd Respondent

Procedural Posture

Companies (winding‑up) No.565 of 2006; Action No.2371 of 2005 (derivative/shareholder Action) / Trial Judgment

Legal Issues

  1. 1 Whether OOCL shares registered in respondent's name were held on trust for the company
  2. 2 Whether shares allotted in Liyou (conversion of US$1,500,000) were held on trust for petitioner/company
  3. 3 Authenticity of three challenged declarations of trust and related audit confirmations

Ratio Decidendi

On the evidence the court accepted that the challenged declarations legitimately referred to OOCL shares and that the Liyou shares allotted on capitalisation of US$1,500,000 belonged beneficially to Yi Chun/the Company. The judge found the petitionerʹs witnesses credible, rejected the respondentʹs accounts as unreliable and dishonest, accepted Dr Strachʹs expert opinion, rejected Mr Shumʹs methodology, and concluded the shares are held on trust for the company; costs awarded on an indemnity basis with certificate for two counsel.

Court Disposition

Judgment for Petitioner/Plaintiff: declarations granted that 350,000 OOCL shares held on trust for J&D Industrial (HK) Limited and that shares allotted to Madam Lu on capitalisation of US$1,500,000 in Liyou are held on trust for Yi Chun; costs to respondent on indemnity basis with certificate for two counsel.

Orders

  • Declaration that respondent holds 350000 OOCL shares on trust for the Company
  • Declaration that shares allotted to respondent on capitalisation of US$1,500,000 in Liyou are held on trust for Yi Chun Navigation Inc.