Yuey Kong Brothers Investment Ltd (銳光兄弟置業有限公司) v Li Tina & Anor [2025] 5 HKC 1 [2025], HKCFI 1776 (Timothy Lam)
Timothy Lam represented the Plaintiff in Yuey Kong Brothers Investment Ltd (銳光兄弟置業有限公司) v Li Tina & Anor [2025] 5 HKC 1, [2025] HKCFI 1776.
The plaintiff company applied under s 42 of the Companies Ordinance (Cap 622) for an order (i) to vacate a document (ND2A) filed on 13 May 2024 from the Companies Register, alleging it falsely recorded the resignation of a director and the appointment of the 1st defendant as his successor director; and (ii) to file a new ND2A to record only the said resignation of a director of the company.
Held, granting the application:
(1) The legal requirements for a director’s resignation did not include any board approval or resolution accepting the director’s resignation (even if the company is a quasi-partnership). The Registrar of Companies’ powers to rectify information in the Companies Register was confined to ‘typographical or clerical error’ pursuant to s 41 of the Companies Ordinance (Cap 622), and must be done pursuant to an order of the court. Zhang Allie v Kim David Nam & Ors [2025] HKCFI 1471, [2025] HKCU 1622 and Chan Ting Fo v Wong Tsz Hong & Ors [2023] HKCFI 3211, [2023] HKCU 5253 considered (paras 16-21).
(2) An effective resignation as a director of the plaintiff company required the resigning director to give notice in writing to the company of his resignation, and compliance with either s 464(5)(b) or (c) of the Companies Ordinance would suffice for this purpose. The notice from the director who purportedly resigned was merely an expression of his intention to resign which may or may not happen, and that was conditional upon the appointment of the 1st defendant as director – which was not a mechanism provided in either the Companies Ordinance or the Articles of Association of the plaintiff company. Hence, the purported resignation of the director was ineffective (paras 22-26).
(3) It was agreed among the parties that there was no resolution approving the 1st defendant’s appointment as director at the 6 May Meeting. Hence, it would be concluded that, while a board resolution was required for the appointment of the new director of the plaintiff company, no such resolution was ever passed to appoint the 1st defendant as director (paras 31, 34).
(4) Allowing false information to remain in a company’s register documents risked misleading third parties, as the company’s ongoing business dealings necessitate clarity on directorship. Regardless of whether there was evidence of material damage, the prospect of damage being caused to the plaintiff company by the information on the Companies Register would justify removal. It was appropriate in the circumstances to order the removal of the Impungned ND2A from the Register. To Sai Tak & Anor v Registrar of Companies & Ors [2020] HKCFI 1615, [2020] HKCU 2265 considered (paras 38-42).
(5) The Duomatic principle did not apply, as it had not been shown that the 1st defendant’s appointment would inevitably be confirmed by the majority of the plaintiff company. Re Dalny Estates Ltd [2018] 1 HKC 325, [2018] 1 HKLRD 409 considered (para 44).
[The above is excerpted from the headnote to the report in HKC.]
