Brothers' feud over family restaurant hits court

The family feud threatening to destroy one of Hong Kong's most famous roast goose restaurants reached court yesterday.

The two brothers who own the Yung Kee restaurant in Central fell out in a row over shares following the death of their father, the Court of First Instance heard.

The elder brother, Kinsen Kam Kwan-sing, is asking the court to issue a winding up order - which could result in its closure or forced sale - claiming that he was stripped of his power when his sibling unfairly obtained majority control and made his son a director.

Kinsen Kam, 64, also claims he was 'humiliated, threatened and shouted at' by the newly promoted nephew in front of staff.

However, he proposed an alternative to winding down Yung Kee Holdings, the company behind the restaurant - either he could buy out his brother's 55 per cent share or his brother could buy out his 45 per cent share.

The company is estimated to be worth up to HK$1.5 billion. The legendary restaurant was founded by their father, Kam Shui-fai, in 1942. In 1968, Fortune magazine named it one of the 15 best restaurants in the world. Last month, however, it lost its Michelin star after just one year.

Jat Sew-tong SC, for Kinsen Kam, also accused Kam Kwan-lai, the younger brother, of misusing the group's assets, paying excessive wages to both his son and daughter and denying his client access to the company books.

Jat said Kam Kwan-lai began his scheme to push out his brother in July 2009. He added: 'The other side abused by whatever means they could, which was unacceptable, to gather the majority control ... not in the interest of the company as a whole and against our interest.'

The court heard that after Kam senior died in 2004, the two brothers each received 35 per cent of the company. Their mother, Mak Siu-chun, sister Kelly Kam and youngest brother Kam Kwan-ki were each bequeathed 10 per cent.

The mother later gave her oldest son her 10 per cent. Kam Kwan-lai obtained the other 20 per cent share from his siblings.

According to documents submitted by Kinsen Kam, his brother disowned his mother after she transferred her shares.

He allegedly wrote to her saying she did 'not have the ability and intelligence to determine who is right and who is wrong, and who shall be subject to the wrath of the heaven. Foolish people would only judge things by their ears, I hope you can live on long enough to see whether the karma would turn out in the way you wish.'

In addition, Kam Kwan-lai was said to have tried to ban his mother from the restaurant.

Jat also said the younger brother and his son refused to distribute dividends to the shareholders, even though the company had more than HK$880million in cash. The two brothers had originally been equal in their roles as shareholders, as the sole directors and in terms of remuneration, Jat said.

It had been a family tradition that members of the Kam family had to start at the bottom. But the younger brother broke that when he arranged for his son to 'come in right at the top of the management' . Jat added that it had been wrong for the younger brother to decide to 'upset the balance and impose his weight'.

The hearing continues before Mr Justice Jonathan Harris.

35%

The amount of shares bequeathed each brother by their father. Now one has 45 per cent, while the other holds 55 per cent