Hong Kong Case Law: Decisions & Judgments

Topic

Reflective loss doctrine

Legal area

Court

23 Jun 2025

REAL ESTATE AND FINANCE FUND (IN LIQUIDATION) AND ANOTHER v. SUN CHEUK PAK ALAN AND OTHERS

Citation

[2025] HKCFI 2478
Court

Court of First Instance
Case number

HCA938/2022

On the balance of probabilities the Court found a deliberate, coordinated fraudulent Scheme by the three Masterminds (Alan, Kimmy, Ricky) assisted by nominees and corporate entities to strip value from REFF via the First Asia Transaction, the Mortgages, the HFS sale, the Paris Sky flip and the Note Portion recapture; those transactions lacked genuine commercial purpose, were dishonest, constituted unlawful means conspiracy (criminal conspiracy to defraud used as the instrumental unlawful means), and gave rise to compensable loss to REFF; specified defendants were held jointly and severally li…
11 May 2023

CHEN YUE v. LI SHAN AND ANOTHER

Citation

[2023] HKCFI 1263
Court

Court of First Instance
Case number

HCA524/2022

The court granted the preservation and ancillary disclosure and repayment relief because the plaintiff's case concerns co-control and ownership of half the company and its assets such that the Company's assets are bona fide the subject matter of the proceedings; a preservation order is available as ancillary interlocutory relief without the plaintiff having to assert proprietary title or pursue a derivative action and without meeting Mareva's dissipation threshold, and therefore the order in terms of the summons was appropriate to maintain the status quo pending trial.
23 Jan 2020

WANG LINPING AND ANOTHER v. CHAN KIN SUN AND OTHERS

Citation

[2020] HKCFI 256
Court

Court of First Instance
Case number

HCA373/2014

Leave was granted to the 1st Defendant to withdraw two specific undertakings (not to exercise rights in relation to his 2,900 shares and not to challenge or change the registered company chop) because material changes and conduct (including failure to comply with Lisa Wong J's facilitative order and intervening PRC litigation that threatened the subsidiary) justified discharge in the court's discretion and the balance of convenience; however most other reliefs were refused because they either infringed the reflective loss principle, were overbroad, sought to usurp PRC courts, or were unnecess…
12 Jul 2019

JOE ZHIXIONG ZHOU v. SAIF PARTNERS II L.P. AND ANOTHER

Citation

[2019] HKCA 766
Court

Court of Appeal
Case number

CACV62/2018

The Court of Appeal held that (1) the plaintiff, given his contractual role and conduct, owed fiduciary duties to the 1st defendant and Fund II co‑partners; (2) the judge was entitled to order an account of profits and disgorgement and to direct disclosure with confidentiality protections and to require the 1st defendant to hold any disgorged profits on trust for Fund II so as to avoid over‑recovery; (3) the plaintiff's procedural and substantive challenges (functus officio, reflective loss) failed as raised late or on insufficient basis; (4) proviso (iv) of article 7.1(c) construed to requir…
18 Dec 2013

WADDINGTON LTD v. CHAN CHUN HOO THOMAS AND OTHERS

Citation

WADDINGTON LTD v. CHAN CHUN HOO THOMAS AND OTHERS
Court

Court of First Instance
Case number

HCA3291/2003

On the facts the Recorder found on the balance of probabilities that Thomas, who controlled the group, caused Profit Point to sell its Prestige shares to facilitate a concerted transaction (the Yugang Agreement) and thereby breached fiduciary duties owed to Profit Point and its holding companies; the court held that BVI BC Act s184C does not, on proper construction and persuasive English authority, abrogate the common law multiple derivative action; Waddington failed to prove allegations against Chansam; damages for Profit Point were quantified and awarded.
16 Jul 2010

EAST ASIA SATELLITE TELEVISION (HOLDINGS) LTD v. NEW COTAI, LLC AND OTHERS

Citation

EAST ASIA SATELLITE TELEVISION (HOLDINGS) LTD v. NEW COTAI, LLC AND OTHERS
Court

Court of First Instance
Case number

HCA2189/2009

The court held that leave had been given for service of the Re‑Amended Writ but that many of EAST's claims were unsustainable: personal claims against directors for inducing their own company to breach the SPA failed absent pleaded bad faith (Said v Butt); multiple derivative claims failed because BVI and Macao law do not recognise multiple derivative actions (Konamaneni), and derivative claims seeking reflective loss were barred by the reflective loss principle (Johnson) and s.168A(2C). Material non‑disclosure in EAST's ex parte application was identified but it did not require setting aside…
8 Sept 2008

WADDINGTON LTD v. CHAN CHUN HOO THOMAS AND OTHERS

Citation

WADDINGTON LTD v. CHAN CHUN HOO THOMAS AND OTHERS
Court

Court of Final Appeal
Case number

FACV15/2007

The Court held unanimously that multiple derivative actions are maintainable at common law in Hong Kong where the corporate control situation justifies allowing a shareholder of a parent to sue on behalf of a subsidiary; the common law requires a prima facie case threshold for derivative actions (Prudential test) though the statutory s168BC adopts a lower 'serious question to be tried' threshold; however the reflective loss principle bars Playmates (and thus its shareholder) from recovering losses that are merely reflective of losses suffered by its sub-subsidiaries, so the action may proceed…

Hong Kong Case Law

REAL ESTATE AND FINANCE FUND (IN LIQUIDATION) AND ANOTHER v. SUN CHEUK PAK ALAN AND OTHERS

CHEN YUE v. LI SHAN AND ANOTHER

WANG LINPING AND ANOTHER v. CHAN KIN SUN AND OTHERS

JOE ZHIXIONG ZHOU v. SAIF PARTNERS II L.P. AND ANOTHER

WADDINGTON LTD v. CHAN CHUN HOO THOMAS AND OTHERS

EAST ASIA SATELLITE TELEVISION (HOLDINGS) LTD v. NEW COTAI, LLC AND OTHERS

WADDINGTON LTD v. CHAN CHUN HOO THOMAS AND OTHERS