CHEN MEI HUAN (ALSO KNOWN AS LIU MEI HUAN CHEN) v. SILVER FAITH HOLDINGS LTD AND OTHERS

CHEN MEI HUAN (ALSO KNOWN AS LIU MEI HUAN CHEN) v. SILVER FAITH HOLDINGS LTD AND OTHERS

The injunction was continued because disclosure of Tronken's accounts revealed substantial director's loans, unclear asset valuations and liabilities that render the company insolvent on the available evidence, creating a real risk that applying the net sale proceeds to repay the director would unfairly prefer the director and prejudice third party creditors; the balance of convenience therefore favoured preserving the proceeds pending fuller investigation and determination.

Citation
CHEN MEI HUAN (ALSO KNOWN AS LIU MEI HUAN CHEN) v. SILVER FAITH HOLDINGS LTD AND OTHERS
Parties
Petitioner: CHEN MEI HUAN (also known as LIU MEI HUAN CHEN); 1st Respondent: SILVER FAITH HOLDINGS LIMITED (銀信控股有限公司); 2nd Respondent: NG MAN SUN (also known as NG WEI); 3rd Respondent: NG WAI YEE
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
22 September 2014
Case Number
HCCW111/2014
Procedural Posture
Companies Winding Up Proceedings / Application to Continue Interim Injunction
Outcome
Interim injunction continued until further order; order nisi as to costs in the cause with a certificate for two counsel
Legal Topics
Continuation of Interim Injunction, Fraudulent Preference, Director's Loans, Buyout Order, Unfair Prejudice, Winding Up
Source Language
EN
Company Law Injunctions Insolvency Equity Continuation of Interim Injunction Fraudulent Preference Director's Loans Buyout Order +2 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 3 Authorities cited 3 Party arguments 2 Amounts and remedies 7
Sign in to unlock

Parties

CHEN MEI HUAN (also known as LIU MEI HUAN CHEN)

Petitioner

SILVER FAITH HOLDINGS LIMITED (銀信控股有限公司)

1st Respondent

NG MAN SUN (also known as NG WEI)

2nd Respondent

NG WAI YEE

3rd Respondent

Procedural Posture

Companies Winding Up Proceedings / Application to Continue Interim Injunction

Legal Issues

  1. 1 Whether the interim injunction restraining respondents from dealing with company and subsidiary assets should be continued
  2. 2 Whether net sale proceeds may be applied to repay a director's loan or would amount to a fraudulent/unfair preference
  3. 3 Whether the director's loans are genuine and properly documented

Ratio Decidendi

The injunction was continued because disclosure of Tronken's accounts revealed substantial director's loans, unclear asset valuations and liabilities that render the company insolvent on the available evidence, creating a real risk that applying the net sale proceeds to repay the director would unfairly prefer the director and prejudice third party creditors; the balance of convenience therefore favoured preserving the proceeds pending fuller investigation and determination.

Court Disposition

Interim injunction continued until further order; order nisi as to costs in the cause with a certificate for two counsel

Orders

  • Interim injunction continued until further order
  • Order nisi that the costs of this application be in the cause with a certificate for two counsel