Fan Heli v Zhang Shujing: Minority Oppression under Companies Act & Forum Non Conveniens
In Fan Heli v Zhang Shujing, the Singapore High Court addressed an application by Zhang Shujing and Zou Ping to stay proceedings brought by Fan Heli for minority oppression under s 216 of the Companies Act. The court, presided over by Aedit Abdullah JC, declined the stay, holding that Singapore was the more appropriate forum given the statutory nature of the claim and the Singaporean incorporation of the companies involved, Sino-Add (Singapore) Pte Ltd and Sino-Trust Shipping Pte Ltd. The court also found that the remedies sought by Fan Heli would not be available in the People's Republic of China.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Application for stay of proceedings declined.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court declined to stay minority oppression proceedings, finding Singapore the appropriate forum despite PRC connections. Statutory action under Companies Act was key.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Fan Heli | Plaintiff | Individual | Application for stay of proceedings declined | Won | Chan Hock Keng, Alma Yong, Ho Wei Jie |
| Zhang Shujing | Defendant | Individual | Application for stay of proceedings declined | Lost | Philip Ling, Kam Kai Qi |
| Zou Ping | Defendant | Individual | Application for stay of proceedings declined | Lost | Philip Ling, Kam Kai Qi |
| Sino-Add (Singapore) Pte Ltd | Defendant | Corporation | Neutral | Neutral | |
| Sino-Trust Shipping Pte Ltd | Defendant | Corporation | Neutral | Neutral |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Aedit Abdullah | Judicial Commissioner | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Chan Hock Keng | WongPartnership LLP |
| Alma Yong | WongPartnership LLP |
| Ho Wei Jie | WongPartnership LLP |
| Philip Ling | Wong Tan & Molly Lim |
| Kam Kai Qi | Wong Tan & Molly Lim |
4. Facts
- Plaintiff commenced an action for minority oppression under s 216 of the Companies Act.
- The Plaintiff, 1st Defendant, and 2nd Defendant owned the 3rd and 4th Defendants in the proportion 25:65:10 respectively.
- The relationship between the Plaintiff and the 1st and 2nd Defendants broke down in 2014.
- The Plaintiff sought a buy-out or winding up of the 3rd and 4th Defendants.
- The 1st and 2nd Defendants sought a stay of proceedings in Singapore, arguing the PRC was the more appropriate forum.
- PRC proceedings were commenced by Sino-Trust Corporation against the Plaintiff for misappropriation of funds and unlawful possession of financial documents.
- The PRC court ruled that the actual place of business of all the companies in the group was in Dalian.
5. Formal Citations
- Fan Heli v Zhang Shujing and others, Suit No 119 of 2015 (Summons Nos 3443 and 5042 of 2015), [2015] SGHC 327
6. Timeline
| Date | Event |
|---|---|
| Plaintiff began an action for minority oppression. | |
| Plaintiff applied for leave to serve cause papers out of jurisdiction. | |
| Court declined the application for stay of proceedings. |
7. Legal Issues
- Forum Non Conveniens
- Outcome: The court held that Singapore was the more appropriate forum.
- Category: Procedural
- Sub-Issues:
- Appropriateness of forum
- Availability of remedies in alternative forum
- Minority Oppression
- Outcome: The court considered the nature of the minority oppression claim in determining the appropriate forum.
- Category: Substantive
- Sub-Issues:
- Oppressive conduct
- Unfair discrimination
8. Remedies Sought
- Buy-out of shares
- Winding up of company
9. Cause of Actions
- Minority Oppression
10. Practice Areas
- Commercial Litigation
- Corporate Law
11. Industries
- Shipping
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Spiliada Maritime Corporation v Cansulex | House of Lords | Yes | [1987] AC 460 | England and Wales | Cited for the principles regarding stay of proceedings based on forum non conveniens. |
| Transtech Electronics Pte Ltd v Choe Jerry and Ors | High Court | Yes | [1998] 1 SLR(R) 1014 | Singapore | Cited for the proposition that a minority oppression action based on a Singapore statute indicates Singapore is the more appropriate forum. |
| Nanjing Ocean (BVI) Co Ltd v Gao Chunhe and anor | East Caribbean Court of Appeal | Yes | Nanjing Ocean (BVI) Co Ltd v Gao Chunhe and anor BVIHCAP 2013/0005 | British Virgin Islands | Cited as a case where the court reached a different conclusion regarding forum non conveniens in a similar situation, but the present court disagreed with its reasoning. |
| Rickshaw Investments Ltd and anor v Nicolai Baron von Uexkull | Court of Appeal | Yes | [2007] 1 SLR (R) 377 | Singapore | Cited for the principle that the risk of conflicting judgments is not determinative in a forum non conveniens analysis. |
| Siemens AG v Holdrich Investment Ltd | High Court | Yes | [2010] 3 SLR 1007 | Singapore | Cited regarding the burden of proof in challenging service out of jurisdiction. |
| Brinkerhoff Maritime Drilling Corp and anor v PT Airfast Services Indonesia and anor appeal | Court of Appeal | Yes | [1992] 2 SLR (R) 345 | Singapore | Cited for the two-stage approach in Spiliada test. |
| VTB Capital Plc v Nitrite International Corp | Court of Appeal | Yes | [2012] EWCA Civ 808 | England and Wales | Cited regarding the readiness to conflate the two stages of the Spiliada test into one. |
| In re Harrods (Buenos Aires) Ltd | English Court of Appeal | Yes | [1992] Ch 72 | England and Wales | Cited for the application of Spiliada principles in a minority oppression case, but distinguished on the facts and the court's view of the remedies available. |
| Peter Roger May v Pinder Lillian Gek Lian | High Court | Yes | [2006] 2 SLR (R) 381 | Singapore | Cited for the point that Singapore courts are used to having foreign witnesses testifying in languages other than English. |
| John Reginald Stott Kirkham and Ors v Trane US Inc and Ors | High Court | Yes | [2009] 4 SLR(R) 428 | Singapore | Cited for the point that the location of documents is even less of an issue in cases generally. |
| Goh Suan Huee v Teo Cher Teck | High Court | Yes | [2010] 1 SLR 367 | Singapore | Cited for the principle that the fact that local remedies may not be available abroad would not generally be sufficient to show the loss of a juridical advantage. |
| King v Brandywine Reinsurance Co | Court of Appeal | Yes | [2005] EWCA 235 | England and Wales | Cited for the point that expert opinion on foreign law is a matter of fact. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) s 216 | Singapore |
| Rules of Court (Cap 322, R 5, 2014 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Minority oppression
- Forum non conveniens
- Stay of proceedings
- Shareholders agreement
- Juridical advantage
- Singapore company
- PRC proceedings
15.2 Keywords
- Minority oppression
- Forum non conveniens
- Companies Act
- Singapore
- China
- Stay of proceedings
16. Subjects
- Civil Procedure
- Company Law
17. Areas of Law
- Civil Procedure
- Company Law
- Forum Non Conveniens
- Minority Oppression