The final battle in the long-running Kwok family saga was put on hold yesterday, after Walter Kwok Ping-sheung got a last-minute court injunction preventing the Sun Hung Kai Properties (0016) board from voting on his ouster.
The SHKP chairman started legal action against the blue-chip company and each member of the board, including his two younger brothers Thomas Kwok Ping-kwong and Raymond Kwok Ping-luen.
In the writ filed with the High Court yesterday, Walter Kwok claims that he came to an agreement with his mother and two brothers before he went on leave in February, specifying the process for him to return to his duties.
Walter Kwok is claiming that his two brothers violated the agreement by attempting to remove him from his positions permanently, even though the agreement said he can return to all his duties provided he fulfills certain criteria, including procuring at least two medical opinions showing he is fit to return.
Sun Hung Kai Properties said it is strongly denying the allegations brought by Walter Kwok but will not comment further at this time, as legal proceedings have begun.
In a statement, the company confirmed a board meeting had been scheduled at 2pm yesterday to vote on a resolution to terminate Walter Kwoks tenure as chairman and chief executive.
According to the company, about an hour before the meeting, Walter Kwok made an application to the court for an interim injunction, which the court granted as there was not enough time to hear the companys arguments.
The interim order in no way represents a final decision on the matter, the company said.
A source said Walter Kwok filed the writ with such a short notice because representatives of the three brothers were deep in discussions on Wednesday night and yesterday morning, but were not able to reach an agreement in the short time available.
Walter Kwok filed the writ to give the parties more time to work out an agreement, the source said.
Walter Kwok wanted to give all parties more time to take the matter seriously, and to give the board of directors time to go through the medical reports that had been prepared, which are said to show the chairman is physically and mentally fit to return, the source said.
Walter Kwok came up with a preliminary suggestion to set up an independent board committee to deal with the matter, the source said.
However, another source said some of the directors and senior management think Walter Kwoks legal action is seriously damaging the companys reputation.
They are disappointed, because his action will definitely hurt the company, the source said.
The source also said Walter Kwoks legal action is disrespectful to some of the company directors who have been close friends of the family since the founding of SHKP by Kwok Tak-seng.
Some of those directors, including Henderson Land (0012) chairman Lee Shau-kee, have been like an uncle to Walter Kwok, the source said.
The company is presently seeking legal advice and its day-to-day operations will continue as usual, a Sun Hung Kai employee said. In the meantime, Mr Walter Kwok remains on a leave of absence.
Walter Kwok is claiming he offered in February to take a leave of absence after his brother Raymond informed him that a doctor at Stanford University had diagnosed Walter Kwok as suffering from bipolar affective disorder and was not fit to work as chairman and chief executive.
The eldest Kwok brother claims he offered to take a three-month leave of absence in order to be treated, and said he had an agreement with his mother and two brothers that he could return after producing two medical opinions showing he was once again fit for duty.
In the writ, Walter Kwok claims he later found out that his discussions with the Stanford University doctor had been secretly planned by his two brothers.
He added he found out the doctors diagnosis was heavily based on misinformation supplied by Thomas Kwok and Raymond Kwok.
Later, three independent medical practitioners told Walter Kwoks mother he was not suffering from any mental disorder, he claims. However, Walter Kwok says his brother Raymond then called each of the medical practitioners and attempted to persuade them of the inaccuracy of their diagnosis.
According to the writ, following these quarrels, the two younger brothers changed the agenda for the board meeting, proposing a resolution Walter Kwok be ousted from his current positions and redesignated a non- executive director.
At this point, Thomas and Raymond Kwok claimed the medical condition of Walter Kwok was no longer relevant, the writ said.
They were then seeking to remove Walter Kwok from office on the basis of [his] conduct both before and after 18 February, 2008, it said.