A Practical Guide to Resolving Shareholder Disputes - Second Edition
Authors: Ludwig Ng; Sherman Yan; Pearlie Koh
Shareholder disputes have existed for as long as there have been companies and are becoming an everyday occurrence in the corporate world. “A Practical Guide to Resolving Shareholder Disputes” is intended to serve as a ready reference, a checklist, and a source of practical guidance for business owners, investors, financial advisers, in-house counsel, and legal practitioners who are involved in this area.
Apart from outlining general principles and practice, this is the first book on the subject that provides specific treatments for different kinds of companies, such as private companies, listed companies, family companies, and non-Hong Kong companies. The authors have outlined the procedural and legal considerations for various types of actions, including derivative actions, unfair prejudice petitions, and just and equitable winding up. Interlocutory applications in shareholder disputes and the most recent local decisions are discussed in detail, and extensive references are also made to illustrative cases from other common law jurisdictions, like the UK and Singapore.
This second edition will fill an important gap in the growing range of Hong Kong legal textbooks on shareholder disputes and is essential reading for practitioners, researchers, and students interested or engaged in this area of law. Further, aside from the numerous updates on Hong Kong case law, more references have also been made to Singaporean cases and statutes in this second edition to benefit not only Hong Kong readers but also to make the book more relevant to Singapore and other Commonwealth readers.
A Practical Guide to Resolving Shareholder Disputes - Second Edition includes crucial updates on Hong Kong case law, as follows:
1. China Metal Recycling (Holdings) Ltd. v Chun Chi Wai [2021] HKCFI 378 in which two former directors were found to be in breach of their fiduciary duties to the company by perpetrating a fraudulent scheme and were ordered to pay equitable compensation to China Metal owed by them in the amount of HKD672.9 million;
2. Moulin Global Eyecare Holdings Limited (in liquidation) v Olivia Lee Sin Mei [2019] 3 HKLRD 833, [2019]HKCU 2763, [2019] HKCFI 1715 in which the Defendant was found to be in breach of her duty to exercise care and skill in performing her roles, notwithstanding the prior knowledge of matters and irregularities she had acquired in her capacity as the former non-executive director of Moulin, member of Holdings’ audit committee, and the principal adviser to Holdings, the same of which ought to have caused her serious concern and prompted further enquiry that would have exposed the senior management’s fraud;
3. Ninotre Investment Ltd v Strong Light Investments Ltd [2021] HKCFI 3095 (CFI) in which the court wound up a solvent, listed company upon the shareholders’ unfair prejudice petition given the extent of the misfeasance and loss caused to the company, thereby rendering it difficult to quantify the adverse impact on the same in the value of the company and its shares;
4. Re Sun Light Elastic Ltd [2013] 5 HKLRD 1 where a petitioner sought a buyout order and in the alternative, a winding-up order, the court would only grant a winding-up order rather than a buyout order only if the petitioner was able to point to particular matters that would make a winding-up order the appropriate or only practical relief by setting out in the petition why he had sought in the alternative a winding-up order and the grounds on which he relied; and
5. Shandong Chenming paper Holdings Limited v ARJOWIGGINS HKK 2 Limited [2020] HKCA 670; [2022] HKCFA 11 in which the second core requirement, i.e. whether there is a reasonable possibility that the winding up order would benefit those applying for it, that a party must satisfy before the court has jurisdiction to wind up a foreign company, was discussed in length.
Ludwig’s major area of practice is insolvency and corporate restructuring. Under his leadership, the firm has a thriving practice advising and representing insolvency practitioners in Hong Kong and overseas in all aspects of their practice, particularly on investigation of corporate fraud, assets tracing and recovery, actions against former company officers, cross-border insolvency and corporate restructuring. The firm also represents banks, financial institutions and substantial creditors in protecting their rights in the insolvency of their customers. Apart from insolvency, Ludwig is also experienced in the whole spectrum of civil and criminal matters, particularly shareholder disputes, corporate fraud, media law and intellectual properties.
Outside the firm, Ludwig is an examiner of the Overseas Lawyers Qualification Examinations.
Ludwig is one of the few solicitors in Hong Kong awarded the Higher Rights of Audience, which entitles him to appear as an advocate in all courts up to the Court of Final Appeal.
Ludwig is selected by AsiaLaw Profiles and Chambers and Partners as a leading lawyer in the fields of Dispute Resolution and Restructuring & Insolvency.
Pearlie Koh has been teaching and writing in the area of company law for many years. She started her academic career with the Nanyang Business School, and is now teaching at the Yong Pung How School of Law, Singapore Management University. She read law at the National University of Singapore and obtained her LL.M from the University of Melbourne, Australia. She is an Advocate and Solicitor of the Singapore Supreme Court.
Sherman frequently acts for listed companies, the shareholders, directors and securities investors in dealing with inquiries and investigations by regulatory bodies such as the Hong Kong Monetary Authority, the Hong Kong Exchanges and Clearing Limited, and the Securities and Futures Commission of Hong Kong. Besides, Sherman is a member of the Civil Litigation Committee of the Law Society of Hong Kong with extensive experience in handling and reviewing new laws and regulations relating to litigation. Sherman is also an arbitrator of the South China International Economic and Trade Arbitration Commission (Shenzhen Court of International Arbitration) (SCIA) and is eligible to act for clients in arbitrations concerning disputes relating to international trade.