Read the full judgment text of CACV 000165/1995 on BabelCite. This Court of Appeal judgment was delivered on 5 March 1996 before Nazareth VP, Godfrey JA, Liu JA.
Civil procedure – summary judgment – derivative action – whether O.14 r.1 of the Rules of the Supreme Court available to plaintiff in minority shareholders' action – family property investment company – interest-free unsecured loans to associated companies – allegations of breach of fiduciary duty – whether summary judgment appropriate for threshold question of whether derivative action can be maintained – requirement of trial of preliminary issue – whether previous directions for joint trial preclude O.14 application – construction of O.14 r.1(2)(b) fraud exclusion – whether confined to Derry v. Peek fraud or extends to all dishonesty – narrower English construction preferred for Hong Kong – whether 'fraud on a minority' falls within exclusion – section 358 Companies Ordinance relief – whether defendants entitled to raise s.358 defence at trial – form of judgment – damages and account of profits as alternative remedies – no particulars of loss or gains – appeal allowed.
Legal issues: Propriety of summary judgment in a derivative action · Construction of O.14 r.1(2)(b) fraud exclusion · Effect of previous inconsistent directions on O.14 application · Summary judgment on disputed breach of fiduciary duty · Section 358 Companies Ordinance relief on summary judgment · Form of judgment - damages and account of profits as alternative remedies
Outcome: Defendants' appeals allowed; the order of Rogers J set aside; the plaintiffs' summons of 30 January 1995 for summary judgment dismissed.