LIU HSIAO CHENG (Plaintiff by original action, suing for all shareholders of Golden Driven Investments Limited except the 1st Defendant herein, Wong Shu Wai and Tsoi Yu Yu) v WONG SHU WAI (1st Defendant by original action; Plaintiff by counterclaim, suing for all shareholders of Golden Driven Investments Limited except Liu Hsiao Cheng and Shen Luan)

Read the full judgment text of CACV 92/2017 on BabelCite. This Court of Appeal judgment was delivered on 7 February 2018 before Cheung CJHC, Lam VP, Kwan JA.

Civil procedure – Limitation – Limitation Ordinance (Cap 347) – s.4(2), s.4(7), s.20(1)(a), s.20(1)(b), s.20(2), s.35(1)(b), s.35(3), s.35(4) – counterclaim for an account simpliciter against a de facto director of a company exercising control over its assets – co-operation between Mr Wong and Mr Liu in tobacco and Zimbabwe businesses funded through GDIL with HK$447,636,928.67 remitted to Zimbabwe from 25 July 2003 to 31 March 2013 – counterclaim pleaded at paragraph 125 seeking account of funds remitted – whether a 6-year limitation period applies by analogy with s.4(2) – whether s.20(1)(b) excludes any limitation period – whether s.20(2) bars the claim as an action to recover trust property – account simpliciter based on fiduciary relationship not subject to any statutory limitation period whether by direct or analogous application – limitation by analogy applies only where equitable remedy corresponds to a common law action such as contract or tort – claim against a de facto director treated as analogous to claim by beneficiary against trustee – s.20(1)(a) and (b) cannot be determined at pleadings stage and remain open after account is taken – s.20(2) does not bar a free-standing claim for an account in equity – appeal allowed – order of Chow J striking out paragraph 125 in respect of remittances on or before 12 July 2007 set aside – costs of appeal and application below to be paid by Mr Liu to Mr Wong on a nisi basis.

Legal issues: Application of 6-year limitation period by analogy under s.4(2) to a claim for an account simpliciter against a fiduciary · Whether s.20(1)(b) of the Limitation Ordinance excludes the time bar · Whether s.20(2) of the Limitation Ordinance bars the claim as an action to recover trust property

Outcome: Appeal allowed; the order of Chow J striking out paragraph 125 of the Re-amended Counterclaim to the extent it related to remittances on or before 12 July 2007 was set aside.

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