The court hearing a petition to wind up the affairs of the famed Yung Kee Restaurant, has been told an angry dispute between Carrel Kam Lin-wang, the third director at the restaurant, and his uncle Kinsen Kam Kwan-sing triggered the petition. Carrel was appointed to the board by his father, Ronald Kam Kwan-lai over the objections of Kinsen Kam. In a recorded conversation, Carrel is heard threatening to sue his uncle for defamation at a meeting that took place in Jan 2010.

In the end, Kinsen Kam Kwan-sing filed a wind-up petition with the court two months later after the brothers failed to agree on a price for Kinsen to sell his shares. The hearing went into its 9th day on Friday with Ronald giving testimony.

Carrel's appointment was announced to the key staff at Yung Kee at a meeting on October 6, 2009. Quoted by Ronald in court, Kinsen had accused his brother of "using dirty tactics" to acquire the majority shareholding in the family business. He then questioned the validity of Carrel's appointment to the board.

Ronald said he was hurt by the open insult and viewed that as a turning point in their relationship. He also saw Kinsen's concern as a small matter that caused anxiety among the staff.

Kinsen reiterated his position at a floor meeting in Jan 2010 through email. A voice recording of that meeting, now an exhibit in the case, was aired during the hearing on Friday. The tape captured the widely reported quote from Carrel: "I speak in a loud voice, but I am not impolite."

Indeed his voice was most clearly picked up in the low quality recording. "At the end, what you did was defamation if there is no reasonable explanation ... Don't interrupt me talking." He said he planned to take further action if there was no response.

Ronald said he acknowledged majority control would permit him to implement what he called sensible plans without obstruction from Kinsen, who he said often rejected proposals.

Ronald argued that in modern management, an executive should learn about front line operations from top to bottom. Therefore his son, whose expertise is gardening and construction, qualified for the director post without any prior experience in the culinary industry.

In an affirmation read out by Jat Sew-tong, counsel for Kinsen, the elder brother stated he disapproved of Carrel's qualification to become the third director. He recalled Yung Kee had to redo a face lift of the sign board because the design by his nephew did not comply with regulations.

Ronald admitted he did not consult his brother, the only other director of the firm about the appointment of Carrel as the third director.

Ronald will return to the stand on Monday, and is expected to be followed by his son.

kahon@chinadailyhk.com

China Daily

(HK Edition 02/11/2012 page1)