A successful party to a buy-out order made in the course of unfair prejudice proceedings can find themselves in a difficult position, at the hands of an uncooperative respondent. Commonly, the Court will try liability and quantum issues separately in such claims in the British Virgin Islands.

If the applicant shareholder succeeds in obtaining an order that their shareholding be bought out, the respondent majority controllers of the company may have little incentive to give proper disclosure of the financial position of the company, sufficient to enable the Court to fix the appropriate price which the majority are required to pay.

Such was the fact pattern in Ng Min Hing v Soemarlie Lie (JCPC 2023/0118, decided 10 April 2024).  Before the Board was an application by the Defendant, Mr. Ng for permission to appeal an unless order made against him by the BVI Commercial Court in November 2022. The unless order was made in the face of Mr. Ng’s refusal to provide any meaningful disclosure at the valuation stage of the proceedings.

As the defendant in an unfair prejudice claim usually has control over the company, a claimant’s access valuation documentation is of vital importance to the quantification of such buy-out orders and to the interests of justice. So, how do you deal with a defendant who fails in their disclosure duties?

Ng v Lie concerned orders for disclosure in the case management process of a trial on the valuation of the shares in a valuable palm oil enterprise, in relation to which the Claimant (and respondent before the Privy Council), Mr. Lie, had established liability against the Defendant (and applicant before the Privy Council), Mr. Ng, in a previous trial. Standard directions for disclosure were given after a directions hearing, which were not complied with by the Defendant. In light of this, an unless order was imposed against the Defendant. In the event that he failed to provide proper disclosure by an extended deadline, he would be debarred from the valuation proceedings. No disclosure was forthcoming, and Mr. Ng stood debarred.

The Defendant appealed the unless order to the Eastern Caribbean Court of Appeal, which dismissed the appeal. He sought leave to appeal from the Court of Appeal and was refused. As noted above, the Defendant’s application for leave to appeal to the Privy Council was dismissed, as the Privy Council found that the appeal disclosed no arguable point of law.

So, when faced with a recalcitrant defendant determined not to give proper disclosure, the proper selection of proportionate case management orders enables the BVI Court to ensure that a successful claimant may still receive proper value for his shares.

Partner Richard Evans, Counsel Alecia Johns and Associate André Sheckleford of Conyers represented Mr. Lie, working alongside Matthew Hardwick KC of 3BV Chambers.


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