RE EVERBRIGHT CHUNG CHEONG DVD CO LTD

RE EVERBRIGHT CHUNG CHEONG DVD CO LTD

The court directed that the requested creditors' meeting should not be convened because the present committee composition was sufficiently representative for present purposes, convening a meeting was likely to be unproductive given creditor dynamics and Starter's majority influence, leaving a vacancy to produce an even-numbered committee risked deadlock, and liquidators and the court remain available to give directions; therefore no meeting was ordered.

Citation
RE EVERBRIGHT CHUNG CHEONG DVD CO LTD
Parties
Company (subject): Everbright Chung Cheong DVD Company Limited; Creditor and Contributory: Starter Investment Limited; Former Shareholder and Joint Venturer: Chung Cheong International Hong Kong Company Limited; Creditor and Parent of Starter: China Everbright Holdings Company Limited; Director, Member of Committee of Inspection and Creditor: Lam Leung Ho; Director, Member of Committee of Inspection and Creditor: Lam Leung Ching; Applicants / Liquidators: Joint & Several Liquidators (including Mr Bruno Arboit)
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
20 October 2005
Case Number
HCCW1340/2003
Procedural Posture
Companies (winding Up) / Summons for Directions Under Section 200(3) Whether to Convene a Creditors' Meeting
Outcome
Direction that the creditors' meeting requested by Starter should not be convened
Legal Topics
Committee of Inspection, Creditors' Meeting, Removal of Committee Member, Liquidators' Powers, Representation of Creditors, Costs
Source Language
EN
Company Law Insolvency Winding Up Corporate Governance Committee of Inspection Creditors' Meeting Removal of Committee Member Liquidators' Powers +2 more

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Parties

Everbright Chung Cheong DVD Company Limited

Company (subject)

Starter Investment Limited

Creditor and Contributory

Chung Cheong International Hong Kong Company Limited

Former Shareholder and Joint Venturer

China Everbright Holdings Company Limited

Creditor and Parent of Starter

Lam Leung Ho

Director, Member of Committee of Inspection and Creditor

Lam Leung Ching

Director, Member of Committee of Inspection and Creditor

Joint & Several Liquidators (including Mr Bruno Arboit)

Applicants / Liquidators

Procedural Posture

Companies (winding Up) / Summons for Directions Under Section 200(3) Whether to Convene a Creditors' Meeting

Legal Issues

  1. 1 Whether a creditors' meeting should be convened under section 200(2)/(3) of the Companies Ordinance
  2. 2 Whether the committee of inspection's composition is fairly representative of creditors' interests
  3. 3 Whether Lam Leung Ho should be removed from the committee of inspection

Ratio Decidendi

The court directed that the requested creditors' meeting should not be convened because the present committee composition was sufficiently representative for present purposes, convening a meeting was likely to be unproductive given creditor dynamics and Starter's majority influence, leaving a vacancy to produce an even-numbered committee risked deadlock, and liquidators and the court remain available to give directions; therefore no meeting was ordered.

Court Disposition

Direction that the creditors' meeting requested by Starter should not be convened

Orders

  • A meeting of creditors required by Starter for the purpose of considering the removal or replacement of Lam Leung Ho shall not be convened
  • The costs of this application are to be paid out of the assets of the Company