Commercial disappointment & failure of substratum not the same
Case briefing: Wang Zhongyong v Union Zone Management Ltd
Chinese pharmaceutical business was held by a BVI company with majority and minority shareholders.
The latter claimed they were subject to unfair prejudice as the parties’ common understandings had led to the creation of a quasi-partnership between them and UZ’s raison d’être, to secure a public listing, had failed.
A just and equitable winding up can be granted in cases of breakdown in shareholder relations leading to deadlock, exclusion from management of a quasi-partnership and loss of raison d’être (substratum).
If the facts do not disclose a quasi-partnership mere commercial disappointment arising from a failure to list should not be equated too readily with a failure of substratum.
A just and equitable winding up is a remedy of last resort much harder to secure if you cannot show a quasi-partnership but N.B. other remedies exist, such as relief for unfair prejudice allowing the court to make such order as it thinks just (in Jersey, “such order as it thinks fit for giving relief in respect of the matters complained of”).
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