RE FULIHAM INVESTMENT LIMITED

RE FULIHAM INVESTMENT LIMITED

The ex parte order appointing the Official Receiver as Provisional Liquidator was set aside because the petitioner failed to disclose a material fact — that the debt was secured — in breach of the duty of full and fair disclosure on ex parte applications; furthermore, there was no substantiated risk that allowing the Company to grant a charge to raise funds would prejudice shareholders, so the Company was permitted to pledge assets to pay the debt.

Citation
RE FULIHAM INVESTMENT LIMITED
Parties
Petitioner (creditor): Overseas Trust Bank; Respondent (company): Fuliham Investment Limited; Intervenor (provisional Liquidator): Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
8 October 1985
Case Number
HCCW217/1985
Procedural Posture
Companies (winding Up) / Application to Set Aside Ex Parte Appointment of Provisional Liquidator and Application for Leave to Grant Charge to Raise Funds
Outcome
Order appointing Official Receiver as Provisional Liquidator set aside; Company granted leave to grant charge over assets to raise funds to pay petitioner.
Legal Topics
Provisional Liquidation, Ex Parte Applications, Non Disclosure/material Non Disclosure, Secured Creditor Rights, Leave to Charge Assets, Official Receiver Role
Source Language
EN
Company Law Insolvency Civil Procedure Provisional Liquidation Ex Parte Applications Non Disclosure/material Non Disclosure Secured Creditor Rights Leave to Charge Assets +1 more

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Parties

Overseas Trust Bank

Petitioner (creditor)

Fuliham Investment Limited

Respondent (company)

Official Receiver

Intervenor (provisional Liquidator)

Procedural Posture

Companies (winding Up) / Application to Set Aside Ex Parte Appointment of Provisional Liquidator and Application for Leave to Grant Charge to Raise Funds

Legal Issues

  1. 1 Whether failure to disclose that the creditor was secured in an ex parte application to appoint a Provisional Liquidator constituted material non-disclosure warranting setting aside the order
  2. 2 Whether the Official Receiver's relationship to the Court alters the duty of full disclosure in ex parte applications
  3. 3 Whether the Company should be permitted to grant a charge over assets (including the shares forming security) to raise funds to pay the secured creditor

Ratio Decidendi

The ex parte order appointing the Official Receiver as Provisional Liquidator was set aside because the petitioner failed to disclose a material fact — that the debt was secured — in breach of the duty of full and fair disclosure on ex parte applications; furthermore, there was no substantiated risk that allowing the Company to grant a charge to raise funds would prejudice shareholders, so the Company was permitted to pledge assets to pay the debt.

Court Disposition

Order appointing Official Receiver as Provisional Liquidator set aside; Company granted leave to grant charge over assets to raise funds to pay petitioner.

Orders

  • Set aside the order appointing the Official Receiver as Provisional Liquidator made on 16 July 1985.
  • Permission granted to Fuliham Investment Limited to grant a charge/pledge over its assets, including the shares forming the security, to raise a loan to pay the petitioner.