CHU KIN HON v. PLENTIFUL MARK LTD (IN CREDITORS’ VOLUNTARY LIQUIDATION) AND OTHERS

CHU KIN HON v. PLENTIFUL MARK LTD (IN CREDITORS’ VOLUNTARY LIQUIDATION) AND OTHERS

Because documentary evidence showed that sufficient shareholder support (effectively 90%) existed to pass a special resolution by written resolution, the use of s228A was improper; the s228A resolution is void and is set aside, the Liquidators' application in HCMP 2288/2019 must be withdrawn and its hearing vacated,...

Source-derived case information.

Citation
[2020] HKCFI 1315
Parties
Joint and Several Liquidators of Plentiful Mark Limited; Plaintiffs (hcmp 2288/2019) and 1st Respondent (hcmp 525/2020): HO MAN KIT AND KONG SZE MAN SIMONE; Defendant (hcmp 2288/2019); Plaintiff (hcmp 525/2020): CHU KIN HON; 1st Defendant (hcmp 525/2020) (in Creditors' Voluntary Liquidation): PLENTIFUL MARK LIMITED; 2nd Defendant (hcmp 525/2020): CHONG CHI SHING; 3rd Defendant (hcmp 525/2020): CHENG CHARK HIM
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
10 June 2020
Case Number
HCMP525/2020
Procedural Posture
Company Insolvency / Originating Summons for Declarations / Decision on Originating Summons / Interlocutory Disposition
Outcome
Declarations granted that the purported s228A resolution is null void and invalid; Liquidators' application HCMP 2288/2019 to be withdrawn; hearing vacated; costs to be paid from the company’s assets.
Legal Topics
Creditors' Voluntary Liquidation, Validity of Board Resolution Under S228 a, Written Resolution / Special Resolution, Unfair Preference, Setting Aside Resolution, Costs From Company Assets, Vacation of Hearing
Source Language
en
Company Law Insolvency Law Civil Procedure Creditors' Voluntary Liquidation Validity of Board Resolution Under S228 a Written Resolution / Special Resolution Unfair Preference Setting Aside Resolution +2 more

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Parties

HO MAN KIT AND KONG SZE MAN SIMONE

Joint and Several Liquidators of Plentiful Mark Limited; Plaintiffs (hcmp 2288/2019) and 1st Respondent (hcmp 525/2020)

CHU KIN HON

Defendant (hcmp 2288/2019); Plaintiff (hcmp 525/2020)

PLENTIFUL MARK LIMITED

1st Defendant (hcmp 525/2020) (in Creditors' Voluntary Liquidation)

CHONG CHI SHING

2nd Defendant (hcmp 525/2020)

CHENG CHARK HIM

3rd Defendant (hcmp 525/2020)

Procedural Posture

Company Insolvency / Originating Summons for Declarations / Decision on Originating Summons / Interlocutory Disposition

Legal Issues

  1. 1 Whether a board resolution purportedly made under s228A Cap 32 was lawfully used when a written special resolution could have been passed
  2. 2 Whether the s228A resolution is null, void and should be set aside
  3. 3 Consequences for the concurrent liquidation proceedings (HCMP 2288/2019) and whether those proceedings must be withdrawn and the hearing vacated

Ratio Decidendi

Because documentary evidence showed that sufficient shareholder support (effectively 90%) existed to pass a special resolution by written resolution, the use of s228A was improper; the s228A resolution is void and is set aside, the Liquidators' application in HCMP 2288/2019 must be withdrawn and its hearing vacated, and costs of the applications are to be paid out of the company's assets.

Court Disposition

Declarations granted that the purported s228A resolution is null void and invalid; Liquidators' application HCMP 2288/2019 to be withdrawn; hearing vacated; costs to be paid from the company’s assets.

Orders

  • Declare the s228A board resolution null, void and invalid
  • Declare consequential relief as sought in the originating summons