RE GOLDLORY RESTAURANT LTD

RE GOLDLORY RESTAURANT LTD

The court held that as a matter of statutory construction s196(2) and rule146(2) confer an unfettered discretion on the court and do not make the Official Receiver's percentage basis the default; consequently the court need not require special circumstances to adopt a time cost basis. As a matter of practice the...

Source-derived case information.

Citation
RE GOLDLORY RESTAURANT LTD
Parties
Official Receiver / Respondent in Consolidated Proceedings: Official Receiver; Private Liquidators / Panel T Practitioners: Alvarez & Marsal Asia Limited; Private Liquidators / Panel T Practitioners: Baker Tilly Hong Kong Business Recovery Limited; Private Liquidators / Panel T Practitioners: Kenny Tam & Co.; Private Liquidators / Panel T Practitioners: Gallant Y.T. Ho & Co.
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
7 July 2006
Case Number
HCCW996/2000
Procedural Posture
Company Winding Up (summary Procedure) Consolidated Referral on Remuneration Basis / Decision on Referred Issue Following Taxation Hearings and Directions by Master
Outcome
Issue determined in favour of adopting time cost basis: (1) statutory construction — court has an unfettered discretion under s196(2) and rule146(2) and the Official Receiver's percentage schedule is not the default basis; (2) practice — time cost basis should be adopted as the basis of remuneration in summary s227F...
Legal Topics
Liquidator Remuneration, Summary Winding Up Procedure, Companies Ordinance S227 F, Companies (winding Up) Rules R146(2), Time Cost Basis Vs Percentage Basis
Source Language
en
Company Law Insolvency Civil Procedure Statutory Interpretation Liquidator Remuneration Summary Winding Up Procedure Companies Ordinance S227 F Companies (winding Up) Rules R146(2) +1 more

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Parties

Official Receiver

Official Receiver / Respondent in Consolidated Proceedings

Alvarez & Marsal Asia Limited

Private Liquidators / Panel T Practitioners

Baker Tilly Hong Kong Business Recovery Limited

Private Liquidators / Panel T Practitioners

Kenny Tam & Co.

Private Liquidators / Panel T Practitioners

Gallant Y.T. Ho & Co.

Private Liquidators / Panel T Practitioners

Procedural Posture

Company Winding Up (summary Procedure) Consolidated Referral on Remuneration Basis / Decision on Referred Issue Following Taxation Hearings and Directions by Master

Legal Issues

  1. 1 Whether remuneration of liquidators appointed under s227F in summary winding-up should be assessed on a percentage basis by reference to realizations or on a time cost basis
  2. 2 Whether rule 146(2) or the Companies (Fees and Percentages) Order impose a default percentage basis absent a court order
  3. 3 Whether the court requires special circumstances before departing from a percentage basis in summary cases

Ratio Decidendi

The court held that as a matter of statutory construction s196(2) and rule146(2) confer an unfettered discretion on the court and do not make the Official Receiver's percentage basis the default; consequently the court need not require special circumstances to adopt a time cost basis. As a matter of practice the court should adopt the time cost basis for remuneration of liquidators in summary s227F cases and provide for that basis when making a summary procedure order to ensure cost‑effective administration and viability of the Panel T Scheme.

Court Disposition

Issue determined in favour of adopting time cost basis: (1) statutory construction — court has an unfettered discretion under s196(2) and rule146(2) and the Official Receiver's percentage schedule is not the default basis; (2) practice — time cost basis should be adopted as the basis of remuneration in summary s227F...

Orders

  • Costs of earlier hearing on 23 March 2006 reserved
  • Official Receiver and participants to inform the court by letter within 7 days what order as to costs they would seek in the hearings