RE MKI CORPORATION LTD

RE MKI CORPORATION LTD

Where payments are shown to be necessary to preserve the company as a going concern or to facilitate rescue, the court will permit them under s.182, subject to later scrutiny and taxation; payments that are disputed, not shown to benefit all creditors or pose a risk of loss (notably the alleged $2m Chesterfield compromise and similar Bank of China settlement) will be refused pending clearer evidence of benefit to creditors and the company’s financial position.

Citation
RE MKI CORPORATION LTD
Parties
Petitioner: Securities and Futures Commission; Respondent (company Subject to Winding Up): MKI Corporation Limited; Creditor/respondent: Chesterfield Ltd; Official Receiver: Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
8 May 1995
Case Number
HCCW562/1994
Procedural Posture
Companies (winding Up) / Further/interim Application Under S.182 of the Companies Ordinance for Leave to Make Specific Payments During Winding Up
Outcome
Application granted in part and refused in part.
Legal Topics
Winding Up, Leave to Make Payments, Compromise of Claims, Professional Fees, Taxation of Costs, Preservation of Going Concern
Source Language
EN
Company Law Insolvency Law Securities Regulation Winding Up Leave to Make Payments Compromise of Claims Professional Fees Taxation of Costs +1 more

Case Brief

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 4 Authorities cited 3 Party arguments 2 Amounts and remedies 1
Sign in to unlock

Parties

Securities and Futures Commission

Petitioner

MKI Corporation Limited

Respondent (company Subject to Winding Up)

Chesterfield Ltd

Creditor/respondent

Official Receiver

Official Receiver

Procedural Posture

Companies (winding Up) / Further/interim Application Under S.182 of the Companies Ordinance for Leave to Make Specific Payments During Winding Up

Legal Issues

  1. 1 Whether court should permit specific payments from company assets under s.182 during winding-up
  2. 2 Whether professional fees incurred in attempting rescue and defending the petition should be allowed
  3. 3 Whether disputed compromises (eg. $2m to Chesterfield, Bank of China settlement) should be paid

Ratio Decidendi

Where payments are shown to be necessary to preserve the company as a going concern or to facilitate rescue, the court will permit them under s.182, subject to later scrutiny and taxation; payments that are disputed, not shown to benefit all creditors or pose a risk of loss (notably the alleged $2m Chesterfield compromise and similar Bank of China settlement) will be refused pending clearer evidence of benefit to creditors and the company’s financial position.

Court Disposition

Application granted in part and refused in part.

Orders

  • Allow payment of Mr. Coulcher’s professional fees incurred to keep the company going
  • Permit continued payment of reduced ongoing rentals for new premises