Applicable Test: Application for leave under s216A of the Companies Act to intervene in on-going proceedings

17 Jan 2017

The recent Court of Appeal decision in Chong Chin Fook v Solomon Alliance Management Pte Ltd and others [2017] SGCA 5 raised a significant point of law in respect of the legal criterion to be applied in an application by a shareholder of a company under s 216A of the Companies Act for leave of court to control conduct of on-going proceedings on behalf of the company.

The Court of Appeal held that in such cases, it is not necessary for the complainant to demonstrate that the company is not prosecuting the action with diligence. It is sufficient for the complainant to show that there is a real probability that the company will not diligently prosecute the suit.

To read the update, please click here.