TAM PO KEI v. TAM BO KIN AND OTHERS

TAM PO KEI v. TAM BO KIN AND OTHERS

The court held that valuation under section 168A may include interest on sums the 1st Respondent is liable to account for due to breach of fiduciary duty; compound interest is appropriate in such circumstances; compound interest was ordered at 1% over prime with monthly breaks; interest periods were specified for each sum (HK$2,683,199.50 for the agreed period; dividends from one month after declaration; joint savings account from date of account closure); the winding up petition consequence agreed at trial (dismissal and supporting contributories to pay costs) stands; and the 1st to 4th Respondents were ordered to pay the costs of the section 168A action, taxed if not agreed, with a...

Citation
TAM PO KEI v. TAM BO KIN AND OTHERS
Parties
Opposing Contributory and Petitioner: Opposing Contributory & Petitioner (HCCW 379/2007; HCMP 1590/2006); Supporting Contributory and 1st to 5th Respondents: Supporting Contributory & 1st-5th Respondents (HCMP 1590/2006; HCCW 379/2007); Company and 6th Respondent: Company & 6th Respondent (HCCW 379/2007; HCMP 1590/2006); Official Receiver (excused From Attendance): Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
1 February 2011
Case Number
HCMP1590/2006
Procedural Posture
Section 168 a Petition Under Company Law; Related Winding Up Petition / Post Judgment Hearing on Interest and Costs (decision on Interest and Costs After Judgment)
Outcome
Winding up petition to be dismissed in line with trial agreement; shares to be purchased under s168A at NAV with adjustments; compound interest awarded and costs ordered to successful party.
Legal Topics
Section 168 a Valuation, Winding Up Petition, Breach of Fiduciary Duty, Account of Profits, Interest (compound Vs Simple), Costs Allocation
Source Language
EN
Company Law Equity and Trusts Civil Procedure Section 168 a Valuation Winding Up Petition Breach of Fiduciary Duty Account of Profits Interest (compound Vs Simple) +1 more

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Parties

Opposing Contributory & Petitioner (HCCW 379/2007; HCMP 1590/2006)

Opposing Contributory and Petitioner

Supporting Contributory & 1st-5th Respondents (HCMP 1590/2006; HCCW 379/2007)

Supporting Contributory and 1st to 5th Respondents

Company & 6th Respondent (HCCW 379/2007; HCMP 1590/2006)

Company and 6th Respondent

Official Receiver

Official Receiver (excused From Attendance)

Procedural Posture

Section 168 a Petition Under Company Law; Related Winding Up Petition / Post Judgment Hearing on Interest and Costs (decision on Interest and Costs After Judgment)

Legal Issues

  1. 1 Whether the court may include interest in a s168A valuation order for shares reflecting sums misapplied by a director
  2. 2 Whether interest should be compound or simple where fiduciary duty breached
  3. 3 Appropriate rate and accrual periods for interest

Ratio Decidendi

The court held that valuation under section 168A may include interest on sums the 1st Respondent is liable to account for due to breach of fiduciary duty; compound interest is appropriate in such circumstances; compound interest was ordered at 1% over prime with monthly breaks; interest periods were specified for each sum (HK$2,683,199.50 for the agreed period; dividends from one month after declaration; joint savings account from date of account closure); the winding up petition consequence agreed at trial (dismissal and supporting contributories to pay costs) stands; and the 1st to 4th Respondents were ordered to pay the costs of the section 168A action, taxed if not agreed, with a...

Court Disposition

Winding up petition to be dismissed in line with trial agreement; shares to be purchased under s168A at NAV with adjustments; compound interest awarded and costs ordered to successful party.

Orders

  • Winding up petition (HCCW 379/2007) dismissed as agreed; supporting contributories to pay costs of the petition, to be taxed if not agreed
  • Order that the Petitioner's shares be purchased by the 1st Respondent at a value reflecting the Company\'s present net asset value, taking into account sums the 1st Respondent must account for