Lu v Fu

In the case of Lu v Fu, the plaintiff, a former member of a company, sought leave to bring a statutory derivative action on behalf of the company against its directors, including the defendant. The plaintiff argued that the directors had breached their fiduciary duties and caused losses to the company. The dispute was heard in the Federal Court of Australia.

The court was required to determine whether the plaintiff was eligible to bring the action under sections 236 and 237 of the Corporations Act 2001, and if the loss claimed was reflective of a loss that could have been claimed by the company. The court also needed to assess whether the directors owed a fiduciary duty to the shareholders and if special circumstances applied.

The court found that the plaintiff had established a prima facie case for leave to bring the proceedings, as the allegations of breaches of fiduciary duty were serious and the loss claimed was not reflective of a loss that could have been claimed by the company. The court also determined that the directors owed a fiduciary duty to the shareholders and that special circumstances did not apply. Consequently, the court granted the plaintiff leave to bring the statutory derivative action on behalf of the company.

The court ordered that the plaintiff be granted leave to bring the statutory derivative action on behalf of the company against the directors. The court further directed that the proceedings be stayed pending the outcome of a related proceeding.