Re C.A. PACIFIC FINANCE LTD & C.A. PACIFIC SECURITIES LTD

Re C.A. PACIFIC FINANCE LTD & C.A. PACIFIC SECURITIES LTD

The court ordered that shares be distributed to clients upon payment of a provisional processing fee equal to 14% of the value of each client's portfolio at the Value Date, that the fee be held in a separate interest-bearing account pending taxation of legal costs and an independent examination and assessment of the Liquidators' remuneration and expenses (to be undertaken by a suitably qualified taxing master or the Court sitting with an accountant-assessor), and that the incidence of the costs of that examination be determined by the court on a discretionary basis according to the propriety, reasonableness and proportionality of the claims.

Citation
Re C.A. PACIFIC FINANCE LTD & C.A. PACIFIC SECURITIES LTD
Parties
Company in Liquidation: C.A. Pacific Finance Limited (in Liquidation); Company in Liquidation: C.A. Pacific Securities Limited (in Liquidation); Applicants/administrators: The Liquidators (Provisional Liquidators appointed liquidators); Interested Party/major Creditor: Securities and Futures Commission; Supervisory Authority: Official Receiver; Beneficiaries/claimants: Clients and former clients of CAPS and CAPF
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
27 November 2001
Case Number
HCCW36/1998
Procedural Posture
Companies (winding Up) Actions Under Companies Ordinance Cap.32 / Decision on Distribution and Reasons for Decision (distribution/examination of Liquidators' Remuneration)
Outcome
Order for distribution of shares upon payment of provisional processing fee of 14% and for independent examination and assessment of Liquidators' remuneration and expenses
Legal Topics
Berkeley Applegate Order, Liquidators' Remuneration and Expenses, Distribution of Trust Assets, Assessment/examination of Remuneration, Provisional Processing Fee, Title to Shares Acquired Through CCASS, Incidence of Costs
Source Language
EN
Company Law Insolvency Law Trusts and Equitable Remedies Civil Procedure Costs and Taxation Berkeley Applegate Order Liquidators' Remuneration and Expenses Distribution of Trust Assets +4 more

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Parties

C.A. Pacific Finance Limited (in Liquidation)

Company in Liquidation

C.A. Pacific Securities Limited (in Liquidation)

Company in Liquidation

The Liquidators (Provisional Liquidators appointed liquidators)

Applicants/administrators

Securities and Futures Commission

Interested Party/major Creditor

Official Receiver

Supervisory Authority

Clients and former clients of CAPS and CAPF

Beneficiaries/claimants

Procedural Posture

Companies (winding Up) Actions Under Companies Ordinance Cap.32 / Decision on Distribution and Reasons for Decision (distribution/examination of Liquidators' Remuneration)

Legal Issues

  1. 1 Whether shares acquired through CCASS are held by the companies on trust for clients (previously decided in favour of clients)
  2. 2 Appropriate mode of distribution of client shares (sell all, sell portion to cover fees, or deliver upon payment)
  3. 3 Whether a provisional processing fee should be imposed and at what rate

Ratio Decidendi

The court ordered that shares be distributed to clients upon payment of a provisional processing fee equal to 14% of the value of each client's portfolio at the Value Date, that the fee be held in a separate interest-bearing account pending taxation of legal costs and an independent examination and assessment of the Liquidators' remuneration and expenses (to be undertaken by a suitably qualified taxing master or the Court sitting with an accountant-assessor), and that the incidence of the costs of that examination be determined by the court on a discretionary basis according to the propriety, reasonableness and proportionality of the claims.

Court Disposition

Order for distribution of shares upon payment of provisional processing fee of 14% and for independent examination and assessment of Liquidators' remuneration and expenses

Orders

  • Liquidators to distribute shares to each client only upon payment of a provisional processing fee of 14% of the value of each client's portfolio as at 19 January 1998 (Value Date).
  • Provisional processing fees to be placed in a separate interest-bearing account; Liquidators to supply accounts of receipts and payments to the Official Receiver and Committees of Inspection at periods to be decided by the Official Receiver.