KOR HIN LUNG v. FUJISEIKO SAFE INDUSTRIAL CO. LTD. AND OTHERS

KOR HIN LUNG v. FUJISEIKO SAFE INDUSTRIAL CO. LTD. AND OTHERS

Because the former joint Special Managers and joint Liquidators incurred necessary and reasonable expenses to preserve and maintain the company's factory and facilitate its sale, and because the company's assets were unlikely to cover the substantial taxed legal costs, the court ordered that their remuneration and necessary expenses be paid out of the company's assets in priority under Rule 179 ahead of the taxed legal costs of the petition parties.

Citation
KOR HIN LUNG v. FUJISEIKO SAFE INDUSTRIAL CO. LTD. AND OTHERS
Parties
Petitioner: KOR HIN LUNG; 1st Respondent: FUJISEIKO SAFE INDUSTRIAL COMPANY LIMITED; 2nd Respondent: FUJI SEIKO COMPANY LIMITED; 3rd Respondent: FUJI SEIKO HONSHA COMPANY LIMITED; 4th Respondent: KAZUO ANADA; 5th Respondent: SHOICHI SAWAI; 6th Respondent: KENICHIRO YAMAGUCHI; 7th Respondent: KIYOHIKO YOKOI; 8th Respondent: TAKESHI FUJITA; 9th Respondent: FULLAND MANAGEMENT LIMITED; 10th Respondent: WONG HING CHEUNG; 11th Respondent: SHOICHI YAMAMOTO
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
24 January 2002
Case Number
HCCW381/1999
Procedural Posture
Companies Winding Up / Interlocutory Application Under S.220 Companies Ordinance and R.179 Companies (winding Up) Rules
Outcome
Summons granted; order that the reasonable remuneration and necessary fees, disbursements and expenses of the former joint Special Managers and joint Liquidators be paid out of the assets of the company in priority under Rule 179 ahead of the taxed legal costs of the parties to the winding-up petition.
Legal Topics
Winding Up, Priority of Costs, Liquidator Remuneration, Special Managers, Preservation and Realization of Assets
Source Language
EN
Company Law Insolvency Civil Procedure Winding Up Priority of Costs Liquidator Remuneration Special Managers Preservation and Realization of Assets

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Parties

KOR HIN LUNG

Petitioner

FUJISEIKO SAFE INDUSTRIAL COMPANY LIMITED

1st Respondent

FUJI SEIKO COMPANY LIMITED

2nd Respondent

FUJI SEIKO HONSHA COMPANY LIMITED

3rd Respondent

KAZUO ANADA

4th Respondent

SHOICHI SAWAI

5th Respondent

KENICHIRO YAMAGUCHI

6th Respondent

KIYOHIKO YOKOI

7th Respondent

TAKESHI FUJITA

8th Respondent

FULLAND MANAGEMENT LIMITED

9th Respondent

WONG HING CHEUNG

10th Respondent

SHOICHI YAMAMOTO

11th Respondent

Procedural Posture

Companies Winding Up / Interlocutory Application Under S.220 Companies Ordinance and R.179 Companies (winding Up) Rules

Legal Issues

  1. 1 Whether remuneration and expenses of former joint Special Managers and joint Liquidators should be paid out of company assets in priority to the taxed legal costs of parties under Rule 179
  2. 2 Whether expenditures to preserve and maintain company assets to enable sale qualify for priority payment ahead of taxed costs
  3. 3 Whether court should exercise discretion to alter priority given prior consent order in light of insufficiency of assets

Ratio Decidendi

Because the former joint Special Managers and joint Liquidators incurred necessary and reasonable expenses to preserve and maintain the company's factory and facilitate its sale, and because the company's assets were unlikely to cover the substantial taxed legal costs, the court ordered that their remuneration and necessary expenses be paid out of the company's assets in priority under Rule 179 ahead of the taxed legal costs of the petition parties.

Court Disposition

Summons granted; order that the reasonable remuneration and necessary fees, disbursements and expenses of the former joint Special Managers and joint Liquidators be paid out of the assets of the company in priority under Rule 179 ahead of the taxed legal costs of the parties to the winding-up petition.

Orders

  • The remuneration, fees, disbursements and necessary expenses properly incurred by the former joint Special Managers and the joint Liquidators shall be paid out of the assets of the 1st Respondent company in order of priority under Rule 179 of the Companies (Winding-Up) Rules ahead of the taxed legal costs of all...