Business group sues chief over HK$13.87m

PUBLISHED : Sunday, 13 April, 2008, 12:00am
UPDATED : Sunday, 13 April, 2008, 12:00am
 

One of the oldest business associations in Hong Kong is seeking the return of HK$13.87 million from its chairman - businessman and Grand Bauhinia Award holder Leo Lee Tung-hai.

In a writ, it alleges he misappropriated the money.

The Chung Shan Commercial Association is suing Mr Lee for the return of the money and the association's chop, according to the writ, filed in the High Court on Friday. Mr Lee has refused to surrender the chop, the writ says.

The association was set up nearly a century ago by businessmen from Zhongshan in Guangdong.

The writ alleges that Mr Lee, in breach of his duties as chairman, wrongfully transferred HK$10.37 million from the association's bank account to his personal account.

It also alleges that Mr Lee, when confronted after the association discovered the transfer this year, admitted he had removed the money. He said the money was transferred to his account after he sought legal advice from his own lawyer, the writ states.

The lawyer told Mr Lee such a transfer could help to avoid certain payments arising from a court order made in 2005 in relation to litigation concerning Mr Lee and other members of the association, the writ says.

In 2004, litigation resulted in a court ordering the association to hold a general meeting last year.

The writ says Mr Lee also revealed that the remaining HK$3.5 million of the association's claim had been paid to his lawyer for the legal advice.

It alleges that at the meeting, Mr Lee, who had kept the association's chop, refused to return it to the general affairs section.

The writ says the association was founded in 1911 and that as of March 31, 2003, it had net assets of HK$39.68 million. Mr Lee was appointed chairman in 2001.

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