Ming Siu Hung and others (Appellants) v J F Ming Inc and another (Respondents) (British Virgin Islands)
Case ID: JCPC 2017/0092
Jurisdiction: Eastern Caribbean Supreme Court
Was the trial judge right to order the Second Respondent to buy out the Appellants' shares in a BVI holding company?
The Appellants and the Second Respondent ('R2') are siblings. The First Respondent ('the Company') was set up by their father as a holding company under the laws of the British Virgin Islands ('BVI'). In accordance with their father's instructions, each of the children were issued 1,000 shares in the Company upon his death. However, when the siblings attempted to remove R2 as director of the Company, R2 revealed that their father had given him an additional 10,000 shares without telling the others. This made R2 the majority shareholder in the Company and allowed him to block any attempt to remove him as a director. When the other siblings discovered R2's status as majority shareholder, they challenged the authenticity of the additional 10,000 shares and sought to remove him as a director of the Company through proceedings in Hong Kong.
Those proceedings were ultimately resolved in favour of R2. As sole director of the Company from 2006 onwards (after the resolution of the Hong Kong litigation), R2 was required by article 120 of the Company's Articles of Association to provide members with annual financial statements unless this was waived by resolution. R2 failed to provide members with any such financial statements or information relating to the Company. In April 2014, following repeated requests from the Appellants, R2 amended the Articles of Association to prospectively and retrospectively waive the requirement to provide financial statements.
The Appellants commenced proceedings on the basis that they had suffered unfair prejudice, seeking an order requiring the Articles of Association to be amended back to their previous state and the financial statements from 2006 onwards to be provided to the members of the Company. They subsequently amended their claim to include an additional order that R2 buy out their shares in the Company. The Appellants succeeded in the BVI Commercial Court on all aspects of their claim, including their request for a buy-out order.
On appeal by R2, the BVI Court of Appeal upheld all aspects of the Commercial Court order save for the buy-out order. The Appellants now seek to appeal the decision not to grant the buy-out order to the Judicial Committee of the Privy Council.
Ming Siu Hung and others
J F Ming Inc and another
Lord Black, Lord Briggs, Lord Arden, Lord Sales, Lord Burrows.
Hearing start date
26 Nov 2020
Hearing finish date
26 Nov 2020