The plaintiff was the chairman and executive director of a listed company. It was the plaintiff's case that the 1st defendant told him that he had incurred substantial losses trading in the shares of the plaintiff's company. The 1st defendant demanded from the plaintiff 100 million shares of the plaintiff's company, which the plaintiff rejected. The 1st and 2nd defendant attended the plaintiff's office and made threats that if the 100 million shares were not handed over, the 4th defendant, a person who identified himself as a member of a criminal organisation, would do something harmful to the plaintiff. Under these circumstances, the plaintiff purchased 100 million shares from the third party Z. Z executed a share purchase agreement for the shares with the 3rd defendant as transferee and the 2nd defendant as guarantor. Z was further threatened by the 2nd defendant to sign a receipt acknowledging the payment for the shares.
The plaintiff applied to join the 5th and 6th defendants in the action. The plaintiff alleged that the 5th defendant, the wife of the 1st defendant, was involved in the setting up of a sham trust and received, handled and laundered the 100 million shares via the sham trust and other companies of the 1st defendant. As against the 6th defendant, the plaintiff alleged that he was the nominee, agent or trustee of the 1st defendant and under his control to receive, keep, handle and launder the 100 million shares through companies that he controlled. The plaintiff also relied on the fact that the 6th defendant was arrested by the police in relation to the offence of money laundering in connection with the sale of the 100 million shares.
In the hearing before the judge, 5th and 6th defendants were represented by counsel. It was argued that the 5th and 6th defendants should be allowed to file affidavit evidence in opposition and substantive argument adjourned for full argument. The 5th and 6th defendants did not disclose their grounds of objection to joinder. After hearing submissions from both parties, the judge acceded to the plaintiff's application and joined the 5th and 6th defendants as defendants. The 5th and 6th defendants appealed. During the appeal hearing, the court was informed that the 5th and 6th defendants' grounds of opposition were that the application for joinder was based on the allegation of the plaintiff that the 5th and 6th defendants were in control of the sham trust which substantively conflicted with a decision given in this matter and therefore issue estoppel arose; and that the police had indicated that there was no evidence of wrongdoing on the part of the 6th defendant in relation to the laundering of the 100 million shares and no prosecution would be brought against the 6th defendant.