Tin Chi Ping v. Chow Wai Fan and Others
Read the full judgment text of HCCW 661/2006 on BabelCite. This High Court CFI judgment was delivered on 14 March 2014.
1. By a Petition dated 15 December 2006 and filed and presented on 19 December 2006, the Petitioner petitions for:
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HCCW 661/2006 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE COMPANIES WINDING‑UP PROCEEDINGS NO 661 OF 2006 _________________
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________________________ A. INTRODUCTION 1.By a Petition dated 15 December 2006 and filed and presented on 19 December 2006, the Petitioner petitions for:
B. BACKGROUND FACTS 2.The following matters, as stated in this section (§§2‑61) of this judgment, are not in dispute and/or are supported by contemporaneous documents, and I find them as facts. (I shall deal with factual issues in dispute later in this judgment.) In particular, I accept the minutes of the board meetings of the Company to be accurate (no one has suggested otherwise) in recording what transpired or had been resolved at such meetings, and my account below of what happened at those meetings is taken from the minutes which I find as facts. B1. The parties and relevant persons 3.The Company was incorporated on 24 November 1992 under the Companies Ordinance as a company limited by shares. 4.Its nominal and issued capital was at all material times and is $10,000 divided into 10,000 shares of $1 each. 5.At all material times up to April and May 2004, the Respondents, and one Koh Choi Yu Shirley (who has subsequently changed her name to Koh Yui Yu Shirley) (“Koh”), were the only directors and registered shareholders of the Company. Koh was the registered holder of 4,000 shares (40%), while the Respondents were (and still are) the registered holders of 3,000 shares (30%) each. 6.The 1st Respondent and Koh met each other in the early 1980’s and have been good friends since. The 1st Respondent’s husband is called Chow Sheung Bing (“Chow”), who was at all material times and is a certified public accountant, and had and has his own accounting firm by the name of SB Chow & Co (“the Firm”) since 1980, having gained his accountant qualifications in the early 1970’s. The 2nd Respondent was a friend and neighbour of Chow and the 1st Respondent. 7.Koh is the former wife of the Petitioner. They married on 24 May 1989 and divorced on 8 July 2004. B2. The settlement between the Petitioner and Koh 8.The Petitioner and Koh entered into a “Settlement Deed” dated 13 April 2004 to effect (as recited therein) a:
9.In particular, the following provisions in the Settlement Deed are relevant:
10.The Settlement Deed contains a signature of a trainee solicitor of the firm then acting for the Petitioner, stating that she had interpreted the same to the Petitioner. In cross‑examination, the Petitioner accepts (and I find) that the contents of this document were explained to him by his solicitors at the time. 11.The Petitioner has given evidence as to the circumstances under which he signed the Settlement Deed, to the effect that he did so to his unfair disadvantage in various aspects, which Koh denies. I need not deal with the evidence of the Petitioner and Koh on this because whatever happened between them regarding the Settlement Deed does not concern the Respondents, who are not alleged to be aware of the circumstances. What happened was that they were shown an extract of the Settlement Deed by the Petitioner which shows that Koh promised to waive all debts owed to her by the Company. 12.Pursuant to the Settlement Deed, on 10 May 2004, the Petitioner was transferred the 4,000 shares in the Company which had been in the name of Koh. He became a director of the Company on 29 April 2004, with Koh resigning as director on the same date. The Petitioner and the Respondents were since then the only directors of the Company until 4 November 2005, when at an annual general meeting of the Company held on that date the Petitioner was not re‑elected. The Respondents have since 4 November 2005 up to now been the only directors of the Company. B3. The Property and Hoi Wai 13.At all times the sole business of the Company was the holding of a property known as Shop 9, Ground Floor, Hung Wai Building, 3‑5 Fa Yuen Street, Kowloon, Hong Kong (“the Property”), which the Company acquired on 9 March 1993[3] for $15,980,000. 14.At all times the Property was leased to a video games centre called Hoi Wai Electronic Games Company (“Hoi Wai”), which in fact had been the tenant of the Property since 1986, ie well before the Company acquired the Property. Hoi Wai ceased to be a tenant of the Property on 7 October 2005, when the Property was sold by the Company. 15.Hoi Wai is the entity referred to at §6 of the Settlement Deed (see §9 above). It was formed on 1 April 1986 and was originally a partnership consisting of one Cheung Kam (“Cheung”) and three other gentlemen. On 1 May 1990, the partners of Hoi Wai, as registered with the Business Registration Office (“the BRO”), became Cheung (who remained the holder of the games centre licence issued in respect of Hoi Wai), one Hui Chor Wan (“Wan”) (who was the elder sister of Koh) and the Petitioner. The Petitioner ceased to be registered as a partner of Hoi Wai with the BRO as from 1 January 1991. On 1 January 1995, Koh replaced Cheung as a partner registered with the BRO, with Wan taking over as licensee. 16.The Respondents are unable to produce any documents relating directly to the leasing of the Property to Hoi Wai before 2000 because pre‑2000 documents have been disposed of. According to the land search record of the Property, a lease dated 22 May 1986 for three years starting on 1 April 1986 was granted to Hoi Wai at a monthly rent of $20,000, and a lease dated 8 May 1989 for two years starting on 1 April 1989 was granted to Hoi Wai at a monthly rent of $36,000. No other tenancy agreements have been registered. I find the terms of the leases of 1986 and 1989 to be as set out above. The evidence of Koh and the 1st Respondent, which I accept, is that the rental being paid by Hoi Wai to the then owner at the time of purchase was $45,000 per month. 17.What the Respondents are able to produce are:
18.As for the period before 2000, the evidence of Koh and the 1st Respondent is that the monthly rent was $80,000 for the first three years of the lease after the purchase of the Property (ie from about 7 July 1993 to 6 July 1996), and $120,000 for the second three years (ie from about 7 July 1996 to 6 July 1999). This is consistent with the information submitted by the Company to the Rating and Valuation Department, and by the reprinted bank statements produced by the Respondents save that, from those bank statements, the monthly rent actually paid became $100,000 when the rent was paid in October 1998. I accept their evidence, and the evidence as constituted by the documents referred to in this and the preceding paragraph, in this regard, and find that the amount paid by Hoi Wai and received by the Company as “rent” every month, was:
without prejudice to the Petitioner’s allegation that the “real” rent was more than these sums which were split into two parts (rent and shareholders’ advance) (see §28 below), an issue I deal with below. 19.The Property was purchased by the Company with contributions from the three shareholders in the proportion of their shareholding, and the assistance of a loan from the China State Bank (later becoming part of the Bank of China) (“the Bank”), secured by a mortgage over the Property. There is, however, no evidence as to the exact amount put in by each shareholder initially. 20.For the initial contribution put in by Koh as the 40% shareholder, there is an issue as to whether the Petitioner was, as he alleges, the source of the funds to the knowledge of the Respondents and Chow, or whether the money came from Koh, whose evidence is that she put together the funds from various sources, including loans from Chow ($1,500,000), her elder sister, Hui Chor Fong (“Fong”), and other friends, as well as funds from businesses jointly owned by her and the Petitioner. I shall deal with this issue below. 21.The loan from the Bank was in the sum of $10,000,000, to be repaid by 120 monthly instalments. The initial monthly instalment was $122,652.63 but, as was standard in mortgage loans in Hong Kong, the interest rate, and therefore the monthly amount payable, fluctuated. Again no documents relating directly to the mortgage payments before 2000 are available. From the available bank statements and payment vouchers, payment for the period from 6 December 1999 to 6 January 2000 was $133,640. While the monthly amount fluctuated, it remained roughly the same until for the period from 6 June 2001 to 6 July 2001, when it went down to $125,632.62, which again remained roughly the same until the last instalment was paid off in July 2013. 22.As for the period before 2000, the reprinted bank statements show that the monthly mortgage payments remained more than $122,000 throughout, going beyond $132,000 (and sometimes even beyond $140,000) since January 1995 until June 2001. 23.On 14 January 2000, the Bank granted further overdraft facilities to the Company up to $200,000. This was revised to a limit of $500,000 on 8 August 2000. 24.It is common ground that the holding of the Property was the sole object and purpose of the Company. The Property having been sold in 2005, unless I hold that I should order the Respondents to buy out the shares of the Petitioner under section 168A, which is the primary relief sought by the Petitioner but which the Respondents resist, it is also common ground that it is just and equitable that the Company be wound up under section 177(1)(f). 25.I should point out that the Respondents are in fact willing to buy out the shares of the Petitioner but they deny that there had been any unfairly prejudicial conduct undertaken by them, and if they are right then I have no jurisdiction to make any orders under section 168A: In re Bird Precision Bellows Ltd [1986] Ch 658 at 670F per Oliver LJ; Re Oriental Overseas Maritime Services Limited (HCCW 833/2005; 25 November 2005) at §15 per Kwan J. The proper valuation of the shares depends on the resolution of certain factual disputes before me and thus the parties cannot simply agree a buy out with expert valuation. B4. The shareholders’ advance 26.According to the audited reports of the Company, at the end of each year the following amounts were owed by the Company to the shareholders as shareholders’ advance:
27.The Respondents are able to produce vouchers only for the shareholders’ advance for January 2000 and later. According to the vouchers, the amount advanced was $38,000 for each of January 2000 to March 2003, and $25,000 for each of April 2003 to March 2004. Without prejudice to the Petitioner’s case as described in §28 below, I find that the sum paid in by Koh every month and credited as shareholders’ advance was $38,000 for January 2000 to March 2003 and $25,000 for April 2003 to March 2004. 28.The evidence of Koh, Chow and the Respondents is that it was agreed between them, before the Property was purchased, that Koh would ensure that there would be sufficient receipt every month by the Company to pay for the mortgage instalment, by her personally paying a sum to the Company on top of the rent to be paid by Hoi Wai, that the monthly sum so paid in would be considered as a payment by all three shareholders (Koh and the Respondents) in the proportion of their respective shareholding, and the amount to be paid in monthly was fixed at the commencement of each three‑year lease term. There is no dispute that the shareholders’ advance as recorded in the audited reports of the Company were made up of the initial contributions made by the shareholders which (together with the loan from the Bank) funded the acquisition of the Property, together with these monthly payments by Koh.[4] However, the Petitioner disputes the evidence of and on behalf of the Respondents as to these payments, and alleges that the payment of rent and a further sum every month was to implement an arrangement, first suggested by Chow, whereby the agreed “real” monthly rent (for example, $120,000 in the first three‑year term) would be split into two parts (with only $80,000 “officially” as rent, and the $40,000 not recorded as such) so that only one part (rent, but at only $80,000 rather than $120,000) would be chargeable to tax and not the other part. In effect, it is alleged that Chow proposed a scheme to evade tax and to defraud the Revenue. This is an issue which I shall deal with below. 29.Without prejudice to the Petitioner’s case as described in §28 above, I find the following to be the amount paid in monthly by Koh and credited as shareholders’ advance, by reference to the reprinted bank statements and vouchers:
Based on the above finding, the total amount paid in as shareholders’ advance over the years would be about $4,367,000 (on top of the initial contributions from each of Koh and the Respondents). However, only $1,746,800 (40%) would have been credited to Koh. B5. Events after the Petitioner became shareholder and director 30.After the Petitioner became a director and shareholder of the Company, I find the following events to have taken place. 31.By a letter dated 10 September 2004 to the Company for the attention of the Respondents, the Petitioner, referring to his directorship of the Company, stated:
32.There was no reply to this letter. 33.By another letter dated 23 December 2004 to the Company for the attention of the 1st Respondent (and copied to the 2nd Respondent), the Petitioner, in his capacity as a director of the Company, stated:
34.There was no reply to this letter. 35.On 23 December 2004, the 1st Respondent gave a notice to convene a directors’ meeting of the Company to be held on 30 December 2004. The agenda included consideration of the approval of repayment of debts due to the “existing and past shareholders” of the Company, as well as the renewal of the tenancy of the Property granted to Hoi Wai (which was due to expire on 6 July 2005). 36.Annexed to the notice of 23 December 2004 was the balance sheet of the Company as at 30 November 2004. According to the balance sheet, as at 30 November 2004, accumulated profits were $6,098,220.01, there was $740,026.51 in the bank, and the Company owed the following debts as shareholders’ advance:
The three debts were in the ratio of 3:3:4, in line with the creditors’ shareholding in the Company before 10 May 2004. 37.The directors’ meeting held on 30 December 2004 was attended by all three directors. At that meeting:
38.By a letter dated 31 December 2004, solicitors then acting for the Company wrote to Koh as follows:
39.By a letter dated 3 January 2005 to the Company for the attention of the 2nd Respondent (and copied to Koh), solicitors then acting for the Petitioner referred to the Settlement Deed and in particular the term that she was to transfer all her shares in the Company to the Petitioner (ie §3.04, a copy of which was enclosed), and her acknowledgment that she had no claim against the Company for loss of office or otherwise, and stated:
Thus, the Petitioner’s stance was that there was no loan advanced by Koh to the Company, and if there were loans the Petitioner was entitled thereto by reason of the Settlement Deed because Koh’s shares had been transferred to him and the fact that she had “relinquished” her interest in the Company including her interest in any loan. It was not alleged that he was the source of any money for the loans. 40.By a deed dated 13 January 2005 (“the Waiver”), Koh confirmed that:
41.On 18 January 2005, the 1st Respondent gave a notice to convene a directors’ meeting of the Company to be held on 27 January 2005. The agenda included consideration of the acceptance of the Waiver, of a request by Hoi Wai that at the expiry of the existing tenancy the same be renewed to 6 October 2005 at the monthly rent of $100,000, and of a proposal to lease out the Property at prevailing market rent after expiry of the existing tenancy. A copy of the Waiver was annexed. 42.The Petitioner attended the directors’ meeting on 27 January 2005 but left in the middle of it after heated discussions between him and the Respondents. After the Petitioner had left, it was resolved that the Company should accept the Waiver and the entire amount of $4,896,885 be taken up as “other revenue” of the Company for the year ending 31 December 2004. It was further resolved that the tenancy of the Property granted to Hoi Wai be extended to 6 October 2005 at the same rental of $100,000 per month, and the Company would consider leasing out the Property to a new tenant at the prevailing market rent after expiry of the existing tenancy. 43.On 18 February 2005, the 1st Respondent gave a notice to convene a directors’ meeting of the Company to be held on 26 February 2005 to consider the audited accounts of the Company for the year ending 31 December 2004. The draft accounts, which recorded the waiver of $4,896,884 in the income statement, and where in the balance sheet the “Shareholders’ advance” was reduced to $6,925,326,[6] were faxed with the notice. 44.By a letter dated 24 February 2005 to the Company for the attention of the Respondents, the Petitioner requested the meeting to be rearranged as he would be busy at the scheduled time. In the letter, the Petitioner said he:
45.However, the meeting took place as convened on 26 February 2005, and the Petitioner did not attend. The Respondents did. At the meeting, the audited accounts were approved. 46.On 17 March 2005, the 1st Respondent gave a notice to convene a directors’ meeting of the Company to be held on 24 March 2005 to consider an offer for the Property in the sum of $33,800,000 to be completed on or before 7 October 2005. 47.The directors’ meeting proceeded on 24 March 2005 in the absence of the Petitioner. In attendance were the 1st Respondent and one Ms Hui Pui Chun Susan as the alternate director of the 2nd Respondent. Four offers had been made, and it was resolved that the Company should accept the highest offer. 48.By a letter dated 8 April 2005 to the Company for the attention of the 2nd Respondent and copied to the 1st Respondent, the Petitioner, as a director of the Company, asked for copies of the following documents for “all the years”:
A chaser dated 22 April 2005 threatened legal action if the documents were not provided within seven working days. 49.By a sale and purchase agreement dated 15 April 2005, the Company agreed to sell the Property to Watson Limited for $34,800,000.[7] 50.In a letter dated 28 April 2005 to the Petitioner, signed by both the Respondents on behalf of the Company, it was stated:
A copy of the approved audited accounts was enclosed, and the Petitioner was also informed of the resolution to sell the Property for $34,800,000. 51.By a letter dated 6 May 2005 for the Company for the attention of the 2nd Respondent and copied to the 1st Respondent, the Petitioner said:
52.By a letter dated 11 May 2005 to the Petitioner, signed by the Respondents on behalf of the Company, it was stated:
53.By a letter dated 23 June 2005 to the Company, Hoi Wai stated it was a condition for the Company to agree to buy the Property that Hoi Wai undertook to rent the Property, and there was an oral agreement between it and the Company that if Hoi Wai agreed to rent the Property the Company undertook to lease the same to it. Hoi Wai complained that the Company suddenly sold the Property because of the dispute between the shareholders, thereby breaching the oral agreement and causing Hoi Wai loss. Since it was facing closure, Hoi Wai requested compensation and an extension of the lease until the end of December 2005. 54.On 4 October 2005, the 1st Respondent gave a notice to convene a directors’ meeting of the Company to be held on 10 October 2005[8] to:
55.By a letter dated 6 October 2005 to the Company for the attention of the 2nd Respondent, solicitors then acting for the Petitioner stated that the Company had failed to explain why the Petitioner, as a director of the Company, was not entitled to have access to the documents asked for, and again asked for the documents to be produced within seven days or an application to the court would be made without further notice. 56.On 7 October 2005, the 1st Respondent gave a notice to convene the annual general meeting of the Company to be held on 4 November 2005 inter alia to receive and consider the accounts and directors’ report the year ending 31 December 2004, and to elect directors. On the same date, Hoi Wai vacated the Property, which was assigned by the Company to the purchaser thereof. 57.The directors’ meeting on 12 October 2005 was attended by all three directors. The Petitioner brought his solicitor along, but the latter was not allowed by the 2nd Respondent (who chaired the meeting) to attend. At the meeting:
58.The annual general meeting on 4 November 2005 was attended by the Petitioner, the 1st Respondent and a Mr Terence Chu (a solicitor) as proxy for the 2nd Respondent. At the meeting:
59.That was the first annual general meeting of the Company ever held. Previously all resolutions that were required to be passed at an annual general meeting (such as approval of financial statements) were passed by paper resolution circulated amongst shareholders. The 1st Respondent admits that the sole purpose of calling this meeting (instead of using the paper resolution method) was to remove the Petitioner as a director. 60.By a letter dated 19 December 2005 to the Company for the attention of the 2nd Respondent, solicitors then acting for the Petitioner repeated his request for the documents to be provided within seven days, otherwise legal proceedings would be commenced without further notice. 61.By a letter dated 31 December 2005 to the solicitors then acting for the Petitioner, solicitors then acting for the Company stated that as the Petitioner had not been re‑elected as a director at the annual general meeting, he was no longer a director and had no right to inspect the Company’s “books of account”. C. THE PARTIES’ CASES 62.The Petitioner’s case can be summarised as follows:
63.While the Petition has given a narrative of the facts on which the Petitioner relies, the exact conducts he relies on as being unfairly prejudicial to him as a shareholder of the Company have not been very clearly identified. In his opening submissions, counsel for the Petitioner identifies the following conducts of the Respondents to be unfairly prejudicial:
64.The case of the Respondents is as follows:
D. DISCUSSION 65.I shall attempt to deal with the disputes of fact between the parties in this section in so far as it is necessary to resolve such disputes in the disposal of this Petition in the context of the complaints made by the Petitioner (§63 above), having regard to the evidence given by the witnesses (namely the Petitioner, Koh, Chow and the Respondents) and the documentary evidence. I am conscious of the fact that the demeanour of a witness is very often not a reliable guide to the question of whether he or she is telling the truth. I shall therefore seek to resolve the disputes and make my findings, if I possibly can, by reference to the inherent probabilities and credibility of the evidence given, in particular against the contemporaneous documents and undisputed facts, rather than by having any reliance on or reference to my observation and impression of the witnesses’ demeanour. I take note of the guidance given in the authorities including Ting Kwok Keung v Tam Dick Yuen (2002) 5 HKCFAR 336 at §§36‑42 per Bokhary PJ and Tradepower (Holdings) Ltd v Tradepower (Hong Kong) Ltd (2009) 12 HKCFAR 417 at §24 per Ribeiro PJ and §140 per Litton NPJ. I further bear in mind the guidance given by Mortimer J in All Best Wishes Ltd v Commissioner of Inland Revenue (1992) 3 HKTC 750 at 773:
D1. Hoi Wai and other businesses 66.The situation regarding Hoi Wai is of some importance because not only a finding of its real ownership impacts on the wider picture of the beneficial ownership (as between the Petitioner and Koh) of the various games centre and trading businesses managed and operated by them and thus on the question of the source of funds provided to the Company which eventually made up the shareholders’ advance recorded in the Company’s accounts, such a finding also impacts on the respective cases of the parties as to how the purchase of the Property came about, who were the participants in the joint venture, and what agreements or understanding had been reached between the parties regarding the funding of the monthly mortgage payments to the Bank. 67.The Petitioner’s case is, as stated above, that he was the sole beneficial owner and proprietor of all the games centre and trading businesses, including Hoi Wai. Koh’s role was no more than an assistant or secretary to him. On the other hand, Koh’s evidence on this aspect has changed in the course of the proceedings. While in her affirmations she says that she was the mastermind of those businesses, and that the Petitioner did not have any beneficial interest in the businesses despite the fact that he was made a shareholder and director of various companies concerned out of legal requirements, in her testimony she says that while she was in the amusement games field, and had started running such businesses, before the Petitioner, she accepts that all such businesses, at least after they got married, were jointly owned and operated by them. 68.More specifically, regarding Hoi Wai, the Petitioner’s evidence is that he was the sole beneficial owner thereof, and it was he who proposed and participated in the purchase of the Property and was the source of the contribution for the purchase referable to the 40% interest in the name of Koh. He contributed the entire purchase price when Hoi Wai was acquired from Cheung and his partners. Cheung was retained as a partner because he was the licensee. Wan was named as a partner so that she could take over as the licensee at the suggestion of Koh, because Koh could not do so as she had some problems with the authorities regarding the licence for another games centre in her name, and it was not considered desirable for the Petitioner himself to become the licensee because he was already holding other licences at the time. 69.As to why the Petitioner ceased to be a partner on record on 1 January 1991, just a few months after his registration as such on 1 May 1990, he first said that it was because he was too busy with his other businesses. He said that while he continued to manage and operate Hoi Wai, he did not see the need to have his name retained on the business registration record, and he was too busy to sign various documents which would be required if his name was retained. However, when cross‑examined further, he said he could not remember why he ceased to be a partner on record of Hoi Wai. 70.The evidence of Koh on Hoi Wai has also changed during the course of the proceedings. In her affirmations, she says that the purchase consideration was contributed as to 1/3 by Wan and Fong and as to 2/3 by her, the latter out of funds from businesses owned and run by her. Wan was named as a partner to represent her own interest as well as the interest of Fong, while the Petitioner was named as a partner to represent Koh’s interest “but merely as a nominee with no beneficial interest therein”. Koh could not be a partner herself because of her problems with another licence in her name. 71.However, in her testimony, having accepted that the various games businesses were jointly owned and operated and developed by both herself and the Petitioner, she also accepts that the 2/3 share of Hoi Wai should be considered to belong to both of them, with their share of the purchase price funded by money which belonged to both of them. Her evidence that Wan and Fong were the beneficial owners of 1/3 of Hoi Wai remains unchanged. There is no convincing explanation for the change of evidence by Koh from what she alleges in her affirmations, namely that she was the mastermind and sole beneficial owner of those businesses (including 2/3 of Hoi Wai). 72.Koh now says that the Petitioner was named as a partner because with Wan being named a partner, she herself could not be the other partner as the Petitioner would not be happy with the two sisters being the partners to his exclusion. She further accepts that the reason given in her affirmations as to why she could not be a named partner is incorrect, since as long as she, while being a partner, did not become a licensee (who was going to be Wan) her problems with the other licence was irrelevant. 73.Koh further states that the reason why the Petitioner ceased to be a partner of Hoi Wai on 1 January 1991 was because he had been questioned as a partner by the ICAC, not because of any specific problems with Hoi Wai but as part of a general, industry‑wide, investigation, and he was so unhappy about the incident that he did not want to remain a partner. 74.I do not accept the Petitioner’s evidence in relation to the ownership of Hoi Wai, for the following reasons:
75.On the other hand, I do not find that I can accept Koh’s evidence in relation to the ownership of 2/3 of Hoi Wai (but that does not mean the Petitioner’s case is proven or should be accepted because of this). As stated, the evidence of Koh on the ownership of 2/3 of Hoi Wai, and of the other games centre and trading businesses has changed as between her affirmations and her testimony without any convincing explanation at all. While I accept that the parties and the witnesses are giving evidence on matters some of which happened more than 20 years ago and so I cannot expect any clear memory of factual details or perfect consistency between witnesses on the same event, I do expect them to be able to give consistent and coherent evidence on fundamental matters such as who was/were the real beneficial owner(s) of the various games centres (including Hoi Wai) in the name of Koh and/or the Petitioner. The change in the evidence of Koh regarding the 2/3 ownership of Hoi Wai, as I set out above, is fundamental with no convincing explanation from her for the change, and I repeat §71 above. In the circumstances I do not think that I can accept any of Koh’s versions of evidence regarding the ownership of 2/3 of Hoi Wai and of the other businesses. 76.I would observe that both the Petitioner’s evidence as set out above, and the latest version of Koh, are at odds with §6 of the Settlement Deed which states in clear and unequivocal terms that Hoi Wai had been solely owned at all times by Koh and Wan. Accordingly, I do not place weight on the inconsistency between §6 of the Settlement Deed and the respective evidence of the Petitioner and Koh in this aspect (namely as between them who was/were the beneficial owner(s) of Hoi Wai). 77.However, what is clear from the contemporaneous documents is that Wan was a partner of Hoi Wai on record at all times, that she became a licensee as from 1 January 1995 in place of Cheung, and she was the person who signed the leases dated 16 June 1999 and 5 July 2002 on behalf of Hoi Wai. As noted, the evidence of Koh that Wan and Fong were the beneficial owners of 1/3 of Hoi Wai remains unchanged. In the absence of any convincing explanation as to the presence of Wan in Hoi Wai (see §74(1)‑(3) above) other than the fact that she was a co‑owner thereof, in the light of what the contemporaneous documents show, I find that Wan was a beneficial owner of Hoi Wai. This finding is further supported by the reference to Wan as a co-owner of Hoi Wai in §6 of the Settlement Deed, because while as I said §6 is at odds with the evidence of both the Petitioner and Koh as to who were the owners of Hoi Wai, I can see no reason why the parties would, whatever was the position between them regarding ownership of Hoi Wai, state that Wan was a co-owner of Hoi Wai except that it is true. 78.In the premises, I am unable to make a finding as to who were the true beneficial owners of Hoi Wai (save that one of them was Wan), as I am unable to accept the evidence of either the Petitioner or Koh in relation to Hoi Wai. This is one of those cases where, on the question of Hoi Wai, I have to take the third option or alternative of relying on the burden of proof. As stated by Lord Brandon of Oakbrook in Rhesa Shipping Co SA v Edmunds [1985] 1 WLR 948 at 955:
79.As the credibility of the evidence of the Petitioner as to the circumstances surrounding the purchase of the Property by the Company, with Koh and the Respondents being the shareholders and directors, leading to the question of whether the Petitioner or Koh was the “real partner” with Chow/the 1st Respondent and the 2nd Respondent and the beneficial owner of the 40% shares, the participation (if any) of the Petitioner in the purchase of the Property and subsequently in the negotiation on the rent at each lease renewal, and what were the terms of the joint venture agreement, is to a very large extent dependent on the satisfactory proof of his case that he was the sole owner of Hoi Wai and that Koh did not have any beneficial interest therein or no decision-making power, and thus it was him alone who had the reason, means and incentive to purchase the Property to secure its availability for Hoi Wai’s use, on which I am unable to make any finding in his favour, equally I am unable to, and I do not, make any findings on those further issues in his favour, as there is no further credible evidence in support the Petitioner’s case on those further issues apart from his own testimony, which as I said is dependent to a large extent on the question regarding Hoi Wai on which he fails on the burden of proof. As I do not accept the Petitioner’s case on Hoi Wai, I do not think that there is any basis for me to accept his evidence in support of his case as summarised at §62(1)‑(5) above. The Petition, in so far as it is based on the complaints in relation to the shareholders’ advance, must therefore fail. 80.It is of course preferable, if I can, to make findings of fact on the relevant issues and to decide the matter accordingly rather than relying on the burden of proof. However, as I analyse below, even if I accept the Petitioner’s evidence on Hoi Wai and his case as summarised at §62(1)‑(4) above (I shall deal with §62(5) separately), I do not think that he has established a case of unfair prejudice in relation to the shareholders’ advance in any event. D2. Shareholders’ advance 81.I shall deal with the shareholders’ advance in two parts: (i) the initial contributions and (ii) the subsequent monthly payments. D2.a The initial contribution 82.I do not think that even if I accept as proven (which I do not) the Petitioner’s case as summarised at §62(1)‑(4) above, he has made out a case of unfair prejudice in relation to the initial contribution. 83.According to the Petitioner’s own testimony, he nominated Koh to be the shareholder of the 40% shares representing his investment in the Company, and he gave the money to Koh for her to put the money into the Company as initial contribution in her capacity as the registered shareholder of the Company. He no longer insists that the money was to be put in as capital contribution rather than as a loan (as he originally suggests in the Petition). Rather, he says in his testimony that he let Koh deal with the money that he had given her, and Koh represented him in the management of the Company. He did not read any audited reports of the Company because he let Koh, who represented him, to handle the affairs of the Company and she would not deceive him, and he himself was not good with accounts. 84.Thus, even on his own case (but which I am not to be taken to have accepted), I do not see how any complaint can be made by the Petitioner in so far as there was any act of the Respondents conducted on the basis that Koh was the creditor of the Company, being the person who had paid in the initial contribution, as properly recorded in its audited accounts, irrespective of whether the Petitioner was the party to this joint venture agreement with the Respondents or Chow or the beneficial owner of the shares, or whether he was the real source of funds, and the Respondents’ knowledge of those matters. There is no reason why the Respondents should concern themselves with the arrangements (if any) between the Petitioner and Koh regarding the ownership of the shares and the fund being the initial contribution. 85.As far as the initial contribution is concerned, there is quite rightly no longer any issue about the correctness of its classification as shareholders’ advance in the accounts.[14] On either side’s case, Koh was properly considered and recorded as the creditor of the Company for the portion of the shareholders’ advance being the initial contribution put in by her. 86.That leaves only the question of the Waiver in so far as the Waiver relates to the portion of the shareholders’ advance originally put in by Koh. As stated, the creditor of that portion as properly recorded in the audited accounts, as far as the Company was concerned, was Koh who, on the Petitioner’s own case, was the nominated shareholder and director and to represent him in the management of the Company and who put in the contribution. 87.When it was proposed that the shareholders’ advances be (partially) repaid to Koh and the Respondents on 30 December 2004, after the Petitioner became the shareholder and director of the Company, the Petitioner’s case is that he objected because first he queried why there were loans to the Company in such huge amounts, and second he said that because of the divorce settlement between him and Koh resulting in the transfer of the 4,000 shares in the Company to him, all of Koh’s rights and interests in the Company, including any loan owed to her, would also be transferred to him, so that if indeed there was any loan due to Koh that should be repaid to him. That these two points were taken by the Petitioner regarding the loans at the meeting of 30 December 2004 is also consistent with the evidence of the Respondents, as well as the letter dated 3 January 2005 from his solicitors setting out his case (§39 above). I therefore find that at the meeting of 30 December 2004 the Petitioner did query the loans, and did object to the partial repayment of the loans, on those two grounds. 88.The first objection he took could not have been valid for the initial contribution (see §85 above). As far as the Company was concerned, as properly recorded in the audited accounts, the creditor was Koh. 89.As for the second objection, he says that he showed the Respondents an extract of the Settlement Deed dealing with the Company, which is common ground and which I find to have happened. But what the Settlement Deed shows is that Koh, the creditor, agreed, and indeed was required by the Petitioner himself, to waive all debts owed by the Company to her, and Koh then confirmed that by the Waiver (§40 above). It does not show that the debt owed to Koh was transferred to the Petitioner. I therefore do not understand why, as the Petitioner argues, Koh had no right to waive any loans, whether as between them, or in so far as the Company was concerned. 90.The Respondents say, and I accept their evidence, that upon being shown the Settlement Deed by the Petitioner they consulted their solicitors. The 2nd Respondent says, and I accept, that they just wanted to follow the law. The 1st Respondent also says, and I accept, that they wanted the solicitors to review the Settlement Deed and to follow up accordingly as to how to deal with the loan. Thus, I find that what happened, on being shown the Settlement Deed by the Petitioner on 30 December 2004, was that the Respondents intended to deal with the sum of $4,896,884 owed by the Company to Koh as per the Settlement Deed with the benefit of legal advice. This, in my judgment, was the only proper way for the Respondents to act. 91.While there is no direct evidence as to the legal advice provided by the solicitors to the Respondents, what happened (as I have found as a fact at §38 above) was that the solicitors proceeded to ask Koh, by their letter of 31 December 2004, to confirm whether she was indeed waiving the debt owed to her in the sum of $4,896,884, enclosing the Waiver in draft form for her to sign if she so confirmed. The 2nd Respondent also says that the thinking of the Respondents at the time was that, in the light of the Waiver, the money could not be paid to Koh, but it could not be paid to the Petitioner either. This is patently the correct position and I accept this evidence and find that that was the Respondents’ thinking at the time. In the light of the Settlement Deed (executed also by the Petitioner and which provided for the waiver of debts owed by the Company to Koh) and the Waiver, in my judgment the Petitioner has failed to establish that the acceptance of the Waiver by the Respondents, and to put the money into the general revenue of the Company instead of paying the same to the Petitioner, was unfairly prejudicial conduct. Again, in my judgment, it was the only proper way for them to act. 92.The Petitioner also alleges that there was an oral agreement between himself and Koh, as part of their divorce settlement, to the effect that all Koh’s rights and interests in the Company would become his, but he accepts that the Respondents did not know about this, so this oral agreement (even if it existed) must be irrelevant in this case where one is to consider the conduct of the Respondents. Thus, I need not consider if this oral agreement existed or whether evidence thereof is admissible in the light of the parol evidence rule. 93.There is no evidence from the Petitioner that at the meeting of 23 December 2004, he also made a claim to the loan on the basis that he was the source of the money or the beneficial owner of the shares all along. The letter from his then solicitors of 3 January 2005 (§39 above) did not rely on those grounds either. Rather, by relying on the transfer of the shares in the Company from Koh to him as the divorce settlement in support of his claim that he would now be entitled to whatever rights Koh had in the Company, including the entitlement to be repaid any loans, the Petitioner was not asserting any beneficial interest of his own which was supposed to have existed all along and to which Koh was also subject as a trustee or nominee, but was seeking to derive some title or interest from a transfer from Koh. 94.In any event, I do not understand how being the beneficial owner of the shares or the originating source of the funds, even if true and if known to the Respondents, would entitle the Petitioner to claim, directly against the Company, the loans put in by Koh as the registered shareholder and, on the Petitioner’s case, his fully authorised representative. In the light of the Settlement Deed, there could not have been any suggestion that the Respondents were put on any notice of any breach of trust or other improper conduct by Koh in giving the Waiver, when the Waiver was clearly made pursuant to, and required by, the Settlement Deed executed by the Petitioner, which Deed was shown to the Respondents. What the Respondents did was to deal with the advance credited to Koh in accordance with the Settlement Deed (after taking legal advice) to which the Petitioner was a party. D2.b The monthly payments 95.As for the shareholders’ loan made up of the monthly cash payments put in every month by Koh, the fact is that they were all credited in the financial statements of the Company, audited not by the Firm but by independent auditors, as shareholders’ advance. There is no dispute that the payments were paid in every month in cash by or at the direction of Koh, who was at all times the registered shareholder of 40% of the shares, and the Petitioner does not claim that it was he who paid in or arranged the payment in of the monthly sum (although the money came from businesses which he claims were solely owned by him). 96.Therefore, unless I am satisfied that the real nature of those payments is in fact not loans from Koh, but is, as the Petitioner claims, part of the monthly rental payment, the burden of so persuading me is on the Petitioner, again the Petitioner’s case must fail in relation to the portion of the shareholders’ advance made up of the monthly cash payments, because there would be no improper manipulation of the accounts, and, as in the case of the initial contribution, there can be no unfairly prejudicial conduct in any way for the Respondents to accept the Waiver by Koh of a debt representing payments made by her to the Company and to whom the debt was properly credited in the audited accounts, in the light of the Settlement Deed shown to them, and in putting the waived sum into the general revenue of the Company instead of paying the same over to the Petitioner (see §§90 and 91 above). This is irrespective of the ultimate source of such payments and the Respondents’ knowledge thereof because even if the Petitioner was the ultimate source to their knowledge what was the arrangement (if any) between the Petitioner and Koh should not be a concern of the Respondents’, and as I said above, there could not have been any suggestion of breach of trust or other improper conduct of Koh in waiving the shareholders’ advance in her name because of the Settlement Deed. 97.For the Petitioner to succeed on this point, not only must he establish to my satisfaction the matters stated at §62(1)‑(4) above (which he has not), but at §62(5) above as well. 98.On the Petitioner’s case, the monthly cash payments were made pursuant to an arrangement proposed by Chow under which the monthly rental payment from Hoi Wai was split up into two parts: one part “officially” as rent and the other part put in as cash and not recorded as rent. The Petitioner’s evidence is that he heard this proposal from Chow at a family gathering (§§28 and 62(5) above) and everybody present (including the Petitioner himself) did not challenge Chow or said anything in particular to his suggestion, and the only reasonable inference is that the suggestion was implemented. If that is so, then it was clearly a scheme conducted with the consent and acquiescence of the Petitioner, and the active co‑operation of his authorised representative, Koh, who did split up the monthly payments into two, by paying the rent by a cheque issued by Hoi Wai, and the amounts (which were credited as shareholders’ advance) by way of cash deposits into the Company’s bank account. That is, I have to find that the arrangement regarding the sum paid in every month by cash ostensibly as a loan and recorded in the accounts as such is a sham (in the meaning as stated by Diplock LJ in Snook v London and West Riding Investments Ltd [1967] 2 QB 786 at 802C‑E). If that was really what happened, then what Chow proposed, and Koh and the Respondents implemented, was a scheme involving false accounting, tax evasion and the defrauding of the Revenue, and the only evidence is a recollection by the Petitioner which does not even feature in the Petition but appeared for the first time in his 7th affirmation filed on 11 May 2011, 4½ years after the Petition was issued. Although it was said that the recollection was prompted by the disclosure of the audited accounts pursuant to an order of Barma J dated 4 December 2009, it still took the Petitioner another 1½ years to make this rather important point. 99.I reject the Petitioner’s evidence that there was such a scheme or arrangement and that the monthly cash payments were made pursuant thereto:
100.In any event, even if the scheme was proposed and implemented as the Petitioner alleges, that was done with the consent and acquiescence of the Petitioner and with the active co‑operation of Koh, who on the Petitioner’s case was his fully authorised representative in the management and operation of the Company including accounting matters thereof and who was also, as the Petitioner accepts, the person in charge of all accounting and financial matters of Hoi Wai. On this basis, it would seem to me that it is not open to the Petitioner to complain of any “manipulation” of the accounts or the dealing of the sums involved as unfair prejudicial conduct against the shareholding interests represented by the 40% shares in Koh’s name (Hawkes v Cuddy (No 2) [2008] BCC 390 at §238 per Lewison J; on appeal Re Neath Rugby Ltd (No 2); Hawkes v Cuddy (No 2) [2009] 2 BCLC 427 at §71 per Stanley Burnton LJ) but since this point has not been fully argued I would not reject the Petitioner’s case on this ground. 101.Since the Petitioner has failed to discharge the burden of showing that the real nature of the monthly cash payments were not shareholders’ loans as recorded in the audited reports, 40% of which was credited to Koh, his complaint as to the acceptance of the Waiver by the Respondents and the payment of the waived sum into the general revenue of the Company instead of paying it to him as constituting unfair prejudice conduct must fail. The analysis above as to the Waiver concerning the initial contribution applies equally to the Waiver concerning the monthly cash payments (see §§90 and 91 above). 102.It is not necessary for me to decide whether I should accept the evidence of Koh, Chow and the Respondents as to the existence of the agreement between them as stated at §64(2) above. However, I acknowledge the force the submissions of the Petitioner made at §99(9) above which as I said cast substantial doubt on the existence of the alleged agreement, although that does not mean that the Petitioner’s case of the tax evasion scheme is thereby proven with the required cogency, and I do consider the very idea of the alleged agreement, in that Koh was in effect making a gift payment to the Respondents every month on top of paying the market rent for the lease of the Property, has an air of commercial unreality to it. D3. Request for inspection of the Company’s documents 103.The Petitioner relies on his right to inspect the Company’s books and records as a director and claims that the Respondents had improperly refused his request. 104.In Ng Yee Wah v Lam Chun Wah [2012] 4 HKLRD 40, a decision of Kwan J dated 28 June 2005, her Ladyship summarised the principle regarding inspection of documents as follows (authorities cited omitted):
105.Subsequently, in Re Tanyuen Investments Ltd (HCCW 375/2008, 28 October 2009) at §20, Kwan JA said:
106.In my judgment, the Petitioner has made out a case of unfair prejudice by reason of the failure of the Respondents to provide documents of the Company to the Petitioner for his inspection, for the following reasons:
107.The Petitioner’s complaint of unfair prejudice based on this ground is made out. D4. Rental waiver 108.As for the rental waiver, I note again that the Petitioner is not suggesting that, by agreeing to waive three months’ rent by Hoi Wai, there was any agreement or understanding or any expectation that any favour would be returned to them by Koh or Hoi Wai. The Petitioner does not suggest that by agreeing to waive the rent the Respondents stood to gain anything personally. Rather, the Respondents, as shareholders, also stood to be adversely affected by the waiver in the same way that the Petitioner would be (although this in itself would not prevent a conduct to be unfairly prejudicial if it otherwise is). 109.The complaint of the Petitioner is that the Respondents agreed to confer a benefit or favour on Hoi Wai without any legitimate reason, and with no gain or benefit to the Company. However, in the absence of any suggestion or complaint of bad faith or other improper motive by the Respondents, let alone proof thereof, in effect the complaint is that the Respondents made a bad management decision. 110.It is difficult in such circumstances to see how the said complaint can amount to unfairly prejudicial conduct. Simply because a bad or poor management decision had been made, that does not mean that there is unfair prejudicial conduct. As Warner J said in Re Elgindata Ltd [1991] BCLC 959 at 993a‑994f:
111.As to the reasons given by the Respondents of why they agreed to waive the rent (§§57(1) and 64(6) above), the Petitioner criticises the main reason given, namely as an incentive for Hoi Wai to vacate on 7 October 2005 so that vacant possession could be delivered by the Company to the purchaser of the Property, suggesting that no such incentive was required because the lease was ending three months before anyway. However, I note that this reason is not a recent fabrication of the Respondents but was one of the reasons given by the 2nd Respondent at the meeting of 12 October 2005 when first challenged by the Petitioner (§57(1) above). The other reason given at the time, that is, to recognise the long term relationship with Hoi Wai, is consistent with the additional reason elaborated in the testimony of the 1st Respondent. I accept the Respondents’ evidence as to what were their respective reasons at the time (as stated at §§57(1) and 64(6) above) for agreeing to the waiver, and I do not think that the credibility of their evidence in this regard is affected by the fact that the Respondents have different recollections as to whether they agreed to the rent waiver at a board meeting or not (as that is the kind of detail which it is not surprising for different witnesses to have different recollections eight years later), or that Koh herself might have given different reasons for the waiver (ie her financial difficulties) as that would be confusing the motives or reasons of different individuals which may well be different. 112.In the premises, with the acceptance of the reasons given by the Respondents, in the absence of any suggestion or complaint or proof of bad faith or other improper motive by the Respondents, I do not think that it is for the Court to go into the commercial wisdom or necessity of those reasons. 113.The Petitioner argues that any “misapplication” of the funds of a company by those in control for their own benefit or the benefit of their family or friends is unfair prejudice conduct, citing Re Elgindata Ltd at 1004g per Warner J and Re Tai Lap Investment Co Ltd [1999] 1 HKLRD 384. With respect, that begs the question of whether the waiver here was a misapplication, and that depends on why the payment was made. As stated, I accept the reasons given by the Respondents as to why they agreed to the rent waiver and even if the Company derived no direct or immediate benefit in the light of those reasons, where different persons might debate as to the commercial wisdom thereof, that does not mean the waiver was a misapplication or was otherwise unfairly prejudicial conduct. 114.I reject the Petitioner’s case on this ground. E. CONCLUSION AND DISPOSAL 115.The Petitioner has succeeded in establishing unfair prejudice, but only in respect of the denial of inspection of documents by him as a director in 2004 and 2005. 116.In particular, the Petitioner has failed to establish a case for challenge the Waiver and the acceptance thereof. Thus, the amount waived by Koh must, as from the date of the acceptance of the Waiver, form part of the general assets of the Company, and not as a sum owing to the Petitioner, for the purpose of any valuation of the Company for the purpose of a buy‑out of the Petitioner’s shares, or in the winding up of the Company. 117.As to what relief I should grant, it is trite that I have a wide discretion under section 168A(2)(a) to grant any relief with a view to bring to an end the matter complained of. Further, the order made must be proportionate to the unfair prejudice found: see Joffe et al, Minority Shareholders: Law, Practice, and Procedure (4th ed, 2011) at §7.231. 118.Since the Petitioner has succeeded on only one of the grounds he relies upon, which has taken up a relatively small part of the proceedings in terms of preparation, evidence and submissions, and the matter complained of, ie the denial of inspection, had long ceased, following the Petitioner’s removal as a director on 4 November 2005, I would invite the parties to make further submissions on the following issues:
119.I direct the Petitioner and the Respondents to file and exchange written submissions on the said two issues within 21 days of the date of this judgment. If so desired, each of the Petitioner and the Respondents can file a reply within seven days thereafter. 120.Lastly, I thank counsel for their assistance.
Mr Kenneth Lee, instructed by V Hau & Chow, for the Petitioner Ms Yanky Lam, instructed by Lau & Ngan, for the Respondents [1] Although the solicitors acting for the 1st and the 2nd Respondents are also the solicitors for the 3rd Respondent (the Company) on the record, as is usual and proper in proceedings like the present, the Company is taking a neutral stance in this case. I shall therefore refer in this judgment to the 1st and the 2nd Respondents collectively as “the Respondents”, which term does not include the 3rd Respondent, which will be referred to as “the Company”. [2] All references to numbered sections in this judgment are references to sections of this Ordinance. [3] This is the date of the nomination by Lo Chi Chong (“Lo”) (who had agreed to purchase the Property from Multi-Source Development Limited as the second confirmor) of the Company as the purchaser. The formal sale and purchase agreement and the assignment were dated 16 March 1993 and 13 July 1993 respectively. On top of the $15,980,000 purchase price, the Company paid Lo another $1,000,000 for his agreement to, in effect, sell the Property to the Company. Stamp duty was $439,450. Thus, apart from legal costs (there is no evidence as to the amount), the total cost of purchase for the Company was $17,419,450. [4] There is evidence that apart from the initial contributions and the monthly payments made by Koh, on a few occasions shareholders of the Company had to put in extra funds to pay for certain expenses. For example, in December 2002 and January 2003, Koh paid in $16,000, and the Respondents paid in $12,000 each, to pay for tax charged on the Company. Such payments would also have been added to the total of the shareholders’ advance stated in the audited reports. As no party has asked me to take into account any such payments separately and no issue arises in relation thereto, and as there is no evidence of the number of occasions this happened and the amount involved, but with the evidence of the 1st Respondent that the amount involved each time is small, I shall not take into account the existence of these payments in my judgment. [5] It is alleged at §40 of the Petition that the Petitioner refused to make a decision on the renewal of the tenancy with Hoi Wai at this meeting, and the 1st Respondent finally agreed to postpone this decision. The resolution stated at (2) here is recorded in the minutes of the meeting. It appears that to me that there is no conflict between the minutes and §40 of the Petition because on a proper reading the resolution does not purport to be a final decision on the question of renewal, but that the question of renewal at $130,000 per month from 7 July 2005 should be considered by the Company. The board did further consider and resolve on the renewal of a tenancy (but at $100,000 and only to 6 October 2005) at a subsequent board meeting held on 27 January 2005. (I further note that the Petitioner produced the minutes of the meeting of 30 December 2004 himself under his 4th affirmation without alleging that it was in any way inaccurate.) [6] From a total of $12,242,210 as at 30 November 2004, ie a difference of $5,316,884 (being $4,896,884 + $210,000 +$210,000). [7] According to the land search record, Watson Limited sub-sold the Property to Reach Victor Limited and the Property was assigned to Reach Victor Limited by the Company on 7 October 2005. [8] Subsequently corrected to 12 October 2005. [9] Meaning a total of $9,720,000 for the Petitioner and $7,290,000 for each of the Respondents. [10] However, during his opening, counsel for the Petitioner accepted that the initial sums put in by the parties to fund the acquisition of the Property (on top of the $10,000,000 borrowed from the bank) were proper shareholders’ loans from the three parties. [11] And, so the Petitioner alleges, that explains why there were two identical tenancy agreements for the period of 7 July 2002 to 6 July 2005 save for the rent (§17(2) above). [12] As will be seen, Koh’s evidence as to whether the Petitioner was also a co-owner has changed from saying that he was not (as stated in her affirmations) to saying that he was (as stated in her testimony). [13] The Respondents had earlier applied for an order that the issue regarding whether the Petitioner was the originating source of the contributions and/or loans paid to the Company in relation to Koh’s shares be dealt with as separate proceedings or be tried separately. By a decision dated 26 October 2010, Harris J dismissed the application. [14] Footnote 10 above. [15] I do not place weight on the fact that the 1st Respondent might have changed her evidence as to whether she was present when Wan signed the lease for $138,000, as it happened more than ten years ago. [16] From a notice dated 4 May 1993 from the Bank. [17] The 1st Respondent says that, after consulting Chow, they gave the Petitioner the audited report of 2003 and documents concerning the Petitioner becoming a director and shareholder of the Company. She cannot recall whether she gave the Petitioner any bank statements or tenancy agreements, which were specially requested by the Petitioner in the letter of 10 September 2004. From the letter of 8 April 2005 from the Petitioner and the reply by the Respondents thereto dated 28 April 2005, the documents stated in the letter of 8 April 2005 (including audited accounts (save perhaps for the audited report of 2003), bank statements and tenancy agreements) had clearly not been provided by the Respondents at any time and I so find accordingly. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cases cited in this judgment
Further hearings and rulings under HCCW 661/2006