LEE CHEUNG LAU v. THOMAS LEE HOK LAU AND OTHERS

LEE CHEUNG LAU v. THOMAS LEE HOK LAU AND OTHERS

The court concluded the liquidators' proposed procedure fell within the permissible range of commercial decisions and was not so unreasonable as to warrant interference; it therefore authorized the liquidators to proceed with one further listing attempt at a reserve of RMB 40,000,000 and, if no acceptable offer by 5pm on 22 September 2016, to shut down CTTS and sell its assets, with specified costs directions.

Citation
LEE CHEUNG LAU v. THOMAS LEE HOK LAU AND OTHERS
Parties
Petitioner: LEE CHEUNG LAU; 1st Respondent: THOMAS LEE HOK LAU; 2nd Respondent: LEE TUNG LAU; 3rd Respondent: QUALITY DENIM LIMITED; 4th Respondent: NEW DENIM LIMITED
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
25 August 2016
Case Number
HCCW289/2012
Procedural Posture
Companies (winding Up) / Chambers Hearing on Liquidators' Summons for Approval to Close Subsidiary and Sell Assets
Outcome
Summons granted in substantial terms; liquidators authorized to close CTTS and sell its assets if no acceptable offer is received by 5pm on 22 September 2016.
Legal Topics
Liquidators' Powers, Sale of Assets, Commercial Judgment, Shareholder Dispute, Equity Transfer, Winding Up
Source Language
EN
Companies Law Insolvency Commercial Law Liquidators' Powers Sale of Assets Commercial Judgment Shareholder Dispute Equity Transfer +1 more

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Parties

LEE CHEUNG LAU

Petitioner

THOMAS LEE HOK LAU

1st Respondent

LEE TUNG LAU

2nd Respondent

QUALITY DENIM LIMITED

3rd Respondent

NEW DENIM LIMITED

4th Respondent

Procedural Posture

Companies (winding Up) / Chambers Hearing on Liquidators' Summons for Approval to Close Subsidiary and Sell Assets

Legal Issues

  1. 1 Whether the court should displace the commercial judgment of the liquidators
  2. 2 Whether the liquidators may close down CTTS and sell its assets if a public listing yields no acceptable offer
  3. 3 Appropriate procedure and reserve price for sale of CTTS as a going concern versus sale of assets

Ratio Decidendi

The court concluded the liquidators' proposed procedure fell within the permissible range of commercial decisions and was not so unreasonable as to warrant interference; it therefore authorized the liquidators to proceed with one further listing attempt at a reserve of RMB 40,000,000 and, if no acceptable offer by 5pm on 22 September 2016, to shut down CTTS and sell its assets, with specified costs directions.

Court Disposition

Summons granted in substantial terms; liquidators authorized to close CTTS and sell its assets if no acceptable offer is received by 5pm on 22 September 2016.

Orders

  • If no offer is received for the purchase of the 100% shareholding held by CTHK in CTTS together with the land and the property, plant and machinery and the service contracts by 5pm on 22 September 2016, the liquidators be at liberty to direct CTTS to shut down its operations and cease taking further orders from...
  • If no such offer is received by that time the liquidators be at liberty to shut down the business operations of CTTS.