Directors of a company are generally not personally liable for oppression claims unless they act beyond their role, with statutory provisions allowing remedies for sustained minority shareholder oppression.

[33]Why and how had this series of supervening events in breach of the several OFRA agreements occurred? Hoe Leong’s explanation was that when Sumatec and Semua International ran into financial difficulties, the joint venture fell apart due to Auspicious Journ ey wanting to extricate itself from its investment but Hoe Leong wished to continue. In these circumstances, in order to salvage the enterprise, Hoe Leong maintained that it was necessary to enter into the conditional agreement , which was effectively a salvage and warehousing arrangement. It is pertinent that the conditional SPA never became unconditional and the sale did not go through.

[34]In March 2013, Auspicious Journey became aware of the salvaging and warehousing arrangement. By April 2013, Auspicious Journey realised that Setinggi Holdings was the nominee utilised for the 49% shareholding investment in Semua International under the salvage and warehousing arrangement. It was also made known to Auspicious Journey that Hoe Leong was prepared to pla ce the all-important 2% shareholding in Semua International into Ebony Ritz, provided Auspicious Journey came up with its proportionate contribution for the same. Auspicious Journey however, refused.

[35]Auspicious Journey, as a minority shareholder who had not been made privy to these important decisions on behalf of Ebony Ritz (and itself) was naturally disgruntled. Accordingly, it filed the present originating summons against the defendants, contending that the 51% SPA had expropriated its rights as well as Ebony Ritz’s rights under the OFRA. The latter had affected Auspicious Journey’s rights as a minority shareholder. Ebony Ritz was a nominal defendant. The 5th – 9th defendants (Quah Yoke Hwee, Boo Song Heng Peter, Ang Siew Koon, Ang Mong Seng and Lim Kok Hoong) were the other directors of Hoe Leong at the material time in addition to James and Paul.

[36]As skilfully summarised by the Court of Appeal (and which I now adopt) Auspicious Journey maintained that its claim fell within the ambit of section 181CA 1965

(a)Ebony Ritz’s 2% call option was expropriated by Hoe Leong at Ebony Ritz’s expense;

(b)Auspicious Journey’s own 49% call option was expropriated by Hoe Leong and its nominee which caused detriment and was prejudicial to Auspicious Journey;

(c)In order to achieve the foregoing, Hoe Leong and the Kuah brothers had utili sed Hoe Leong’s majority powers to waive Ebony Ritz’s entitlements under the Profit Shortfall Guarantee and Ebony Ritz’s 2% call option;

(d)Hoe Leong and the Kuah brothers had also caused to furnish an indemnity to keep Sumatec indemnified in the event any claims were made against Sumatec. There was also a re - assignment of dividends previously payable such that all previous conditions were waived. This was clearly to the detriment of Ebony Ritz.

[37]In summary, Auspicious Journey sought a declaration that Hoe Leong as the majority shareholder, and the Kuah brothers as directors:

(a)Conducted the affairs of Ebony Ritz in a manner that was oppressive to Auspicious Journey and in disregard of its interests as member of Ebony Ritz;

(b)Had procured and/or caused to be done and/or threatened to procure or cause to be done to Ebony Ritz an event/s which unfairly discriminated against or which was or is prejudicial to Auspicious Journey as a member of Ebony Ritz.

[38]What was Hoe Leong’s response? In brief, Hoe Leong contended that Auspicious Journey brought this action to recover its investment in Semua International , by, inter alia, having its 20% sharehold ing in Ebony Ritz bought over by Hoe Leong.

The Decision of the High Court

[39]The High Court allowed Auspicious Journey’s claim in part. It made findings of fact that the matters set out above were proven. This resulted in a finding