Background:
Xuan Lu, a 49% non-voting shareholder of 1087041 B.C. Ltd., sought leave to prosecute a derivative action on behalf of the company against PengWei Dong, the 51% voting shareholder, and other third parties. Lu and Dong were married and had ongoing family law proceedings, including a divorce.

Legal Issues:
The main legal issue was whether Lu could bring a derivative action under the Business Corporations Act (B.C.). Lu alleged that Dong misappropriated company funds for personal use and engaged in other misconduct, including unjust enrichment, conversion, and breach of fiduciary duty. She also sought to include claims against third parties for assisting in these breaches.

Court's Analysis:
The court evaluated whether Lu met the statutory requirements for good faith and whether the proposed action was in the company's best interests. Justice M. Taylor found that Lu did not meet the good faith requirement, citing her personal animosity towards Dong and the overlap between the derivative action and the ongoing family proceedings. The court also doubted whether the potential benefits of the action outweighed the costs and complications it would impose on the small business.

Outcome:
The court dismissed Lu’s application for leave to prosecute the derivative action. No award was granted in favor of any party, and the parties were given leave to address the issue of costs separately.