CHAR ON MAN AND ANOTHER v. PEKING FUR FACTORY (HONG KONG) LTD AND OTHERS

CHAR ON MAN AND ANOTHER v. PEKING FUR FACTORY (HONG KONG) LTD AND OTHERS

Section 228A was wrongly invoked because it is only available where it is not reasonably practicable to wind up under another section; here the two members controlling all voting shares could and should have used the written special resolution procedure (under ss548-549 and s564 of Cap 622 and s228(1)(b) of Cap 32)...

Source-derived case information.

Citation
[2019] HKCFI 2141
Parties
1st Plaintiff: CHAR ON MAN; 2nd Plaintiff: O & E INTERNATIONAL LIMITED; 1st Defendant: PEKING FUR FACTORY (HONG KONG) LIMITED; 2nd Defendant: CHAN MAN HAU PATRICK; 3rd Defendant: 叶雪明
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
3 September 2019
Case Number
HCMP768/2018
Procedural Posture
Inherent Jurisdiction; Companies (winding Up) / Decision on Originating Summons (hearing in Chambers)
Outcome
Originating summons granted; board resolution dated 11 May 2018 and appointment of provisional liquidators declared invalid; current liquidation stayed
Legal Topics
Voluntary Winding Up, Section 228 a Procedure, Written Special Resolution, Appointment of Provisional Liquidators, Costs Orders
Source Language
en
Company Law Insolvency Civil Procedure Voluntary Winding Up Section 228 a Procedure Written Special Resolution Appointment of Provisional Liquidators Costs Orders

Source-derived case record

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 5 Authorities cited 5 Party arguments 2
Sign in to unlock

Parties

CHAR ON MAN

1st Plaintiff

O & E INTERNATIONAL LIMITED

2nd Plaintiff

PEKING FUR FACTORY (HONG KONG) LIMITED

1st Defendant

CHAN MAN HAU PATRICK

2nd Defendant

叶雪明

3rd Defendant

Procedural Posture

Inherent Jurisdiction; Companies (winding Up) / Decision on Originating Summons (hearing in Chambers)

Legal Issues

  1. 1 Whether a board written resolution under s228A validly placed the company into liquidation when members could have used a written special resolution
  2. 2 Whether the appointment of provisional liquidators pursuant to that resolution was valid
  3. 3 Whether the liquidation should be stayed

Ratio Decidendi

Section 228A was wrongly invoked because it is only available where it is not reasonably practicable to wind up under another section; here the two members controlling all voting shares could and should have used the written special resolution procedure (under ss548-549 and s564 of Cap 622 and s228(1)(b) of Cap 32) to wind up the company, therefore the board resolution of 11 May 2018 and the consequent appointment of provisional liquidators were invalid and the liquidation is stayed.

Court Disposition

Originating summons granted; board resolution dated 11 May 2018 and appointment of provisional liquidators declared invalid; current liquidation stayed

Orders

  • Declaration that the written board resolution of 11 May 2018 purporting to put the Company into liquidation pursuant to s228A is null, void and invalid
  • Declaration that the appointment of Wong Kwok Keung and Arab Osman Mohammed as provisional liquidators is invalid