Read the full judgment text of FAMV 000019/2001 on BabelCite. This FAMV judgment was delivered on 17 September 2001 before Bokhary PJ, Chan PJ, Ribeiro PJ.
Company law – winding-up – just and equitable – quasi-partnership – minority shareholder – unfairly prejudicial conduct – section 168A, Companies Ordinance – company formed in 1986 with $200,000 share capital – 49% held by petitioner and 51% held by nominees for Strong Progress Ltd, a wholly-owned subsidiary of the 2nd respondent, a state-owned corporation – trial judge found petitioner defrauded the company through defalcations – valuation report showing adjusted capital deficiency exceeding $202m, negative goodwill exceeding $272m, and shares of nil value – capital increase of 50 million shares in May 1992 – whether new issue of shares caused unfairly prejudicial dilution of petitioner's interest – held, no – where petitioner's shares are valueless, capital injection can only enhance, not prejudice, the value of his holding and was essential to the company's survival – whether defrauding petitioner can invoke equitable relief in quasi-partnership winding-up – he who seeks equity must do equity – defrauding the company eliminates the basis of mutual trust and confidence required for a quasi-partnership – whether leave to appeal should be granted on a question of great general or public importance – no – Court of Appeal corrected a misapplication of legal principles, not an impermissible interference with discretion – application dismissed – costs of application to be paid by the applicant to the respondents.
Legal issues: Whether new issue of shares caused unfair prejudice to the minority shareholder · Whether a defrauding petitioner can invoke equitable relief in a quasi-partnership winding-up · Whether leave to appeal should be granted on the basis of a question of great general or public importance
Outcome: Application for leave to appeal dismissed.
Cited by 2 cases