China Club sues estate of late Sir David Tang for more than HK$100m over breach of fiduciary duty as director

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The late Sir David Tang

21st November 2022 – (Hong Kong) Sir David Tang, the late founder of the clothing brand “Shanghai Tang” and “China Club”, passed away in 2017. A company in which he was a director of before his death filed a civil lawsuit in the High Court last Friday (18th), alleging that Tang improperly transferred more than 100 million Hong Kong dollars of company funds to his own or related companies in different ways, which violated his fiduciary duty as a company director. The company now seeks an order from the court to confirm that the relevant funds were held by Tang as trustee on behalf of the company, and to request his estate to return the relevant funds.

The plaintiff in this case is The China Club (China Investment Incorporations) Limited, and the defendant is Gordon David Michael George Oldham, the estate administrator of Chris Tang. The plaintiff alleged three counts of breaches of a director’s fiduciary duty in a legal suit (Case No.: HCA 1613/2022)filed on Friday. The plaintiff alleges that from 2016 to 2017, Tang transferred a total of more than HK$51.87 million in cash from the plaintiff’s account to his personal account or the account of a company controlled by Tang several times. The plaintiff also claimed that between 2007 and 2014, Tang arranged for the auction of artworks belonging to the plaintiff several times, but deposited the proceeds of HK$56.29 million from the auction into an account controlled by Tang himself.

Finally, the plaintiff alleges that during the period from 1998 to 2016, Tang distributed more than HK$6.74 million to himself when distributing the plaintiff’s shareholder dividends. The plaintiff now requests the court to issue a statement confirming that the above three sums of money belong to the plaintiff, and Tang only held the money on behalf of the plaintiff as a trustee. The defendant must now return the money to the plaintiff, or make corresponding compensation to the plaintiff.