RE GOLDLORY RESTAURANT LTD

Parties

Procedural Posture

Company Winding Up / Insolvency (summary Procedure) / Determination of Statutory Issue on Basis of Liquidator Remuneration (chambers Decision)

Legal Issues

1. 1 Whether remuneration of liquidators appointed under s 227F of the Companies Ordinance should be fixed on a percentage basis or a time cost basis
2. 2 Whether rule 146(2) mandates the percentage basis as the default for summary cases or whether the court has discretion under s196(2) to adopt the time cost basis without special circumstances being shown

Ratio Decidendi

The court held that s196(2) and r146(2) confer an unfettered discretion on the court to determine the basis of remuneration in summary cases and that the percentage basis applicable to the Official Receiver is not the mandatory default; as a matter of practice and consistent with statutory purpose and administrative realities (including the Panel T Scheme), the time cost basis shall be adopted for liquidators in summary cases and should be provided for when a summary procedure order under s227F is made; no requirement to show special circumstances to adopt time cost.

Court Disposition

Issue determined in favour of adopting time cost basis as the practice for remuneration of liquidators in summary cases under s227F; court exercise of discretion under s196(2) affirmed

Orders

• Time cost basis to be adopted as the basis of remuneration for liquidators in summary procedure cases and to be provided for upon making of a summary procedure order under s227F
• No requirement for liquidators to show special circumstances to adopt time cost basis in summary cases