LAM KA WAI REBECCA IN HER CAPACITY AS SOLE EXECUTRIX OF CHAN SIU MAN, DECEASED v. GOLDEN TIME ENTERPRISES LTD

HCMP 1981/2024

[2025] HKCFI 2653

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 1981 OF 2024

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REASONS FOR DECISION

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1.  It appears from the Defence of the 1^st and the 2^nd Defendants (“DA Defendants”)  filed in the statutory derivative action, HCA 2324/2025 (“Action”), that the issues alleged against them are hotly uncontested.

2.  The Court is concerned about the long-standing dispute between, inter alia, the Plaintiff and the DA Defendants in connection with a probate matter.  It appears that the said Defence echoes an underlying dispute, namely, the probate matter.  It must be said that professional directors have been appointed to the Company’s board of directors since 2022 and there is no suggestion of any wrongdoing on the part of the DA Defendants having been discovered by those directors.

3.  Although this application for costs indemnity in favour of the Plaintiff by the Company is uncontested, the Court does not rubber stamp the application.  Instead, the Court is duty bound to scrutinise the application as the justice of the case may require. 

4.  The Court should be vigilant that the Action does not serve as a proxy war to further the interest of anyone other than that of the Company. Presently, the Court is insufficiently informed to make a decision on this application.  Like Kwan J (as she then was)  in Tsang Wai Lun Wayland v Grand Field Group Holdings Ltd, unrep, HCMP 1059/2008, 26 February 2009, [50] and [54], I believe that the better course is to defer the decision until a later stage when the outcome of the Action is known or when the position is clearer. 

5.  Finally, I would like to add that an appropriate costs indemnity order may include a direction that the Company has liberty to apply for an order that the costs paid out of the Company’s assets be borne by the Plaintiff.  Such a direction may mitigate against the situation where the Action turns out to be unfounded.

6.  For these reasons, this application is adjourned sine die with liberty to restore, and costs be reserved.