RE MF GLOBAL HOLDINGS HK LTD

RE MF GLOBAL HOLDINGS HK LTD

The court exercised its discretion to convert both court windings into creditors' voluntary windings, appoint the provisional liquidators as joint and several liquidators and establish committees of inspection; crucially, the court held that a provisional liquidator who continues in office by virtue of section 194(1)(aa) is not a 'liquidator' for the purposes of section 202(1) of the Companies Ordinance, and therefore sums realized by such provisional liquidators are not required by that provision to be paid into the Companies Liquidation Account and do not attract ad valorem fees under the Fees Order (any legislative anomaly to be addressed by statute).

Citation
RE MF GLOBAL HOLDINGS HK LTD
Parties
Company (debtor): MF Global Hong Kong Limited; Company (debtor): MF Global Holdings HK Limited; Applicant (provisional Liquidators): Patrick Cowley; Fergal Power; Lui Yee Man (joint & several provisional liquidators, KPMG); Respondent (official Receiver): Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
4 October 2012
Case Number
HCCW357/2011
Procedural Posture
Companies (winding‑up) / Application for Conversion to Creditors' Voluntary Winding Up and Determination of Statutory Payment/fee Obligations
Outcome
Application granted in part: conversions granted; provisional liquidators appointed as joint and several liquidators; committees of inspection appointed; court held s202(1) does not apply to provisional liquidators in office under s194(1)(aa).
Legal Topics
Provisional Liquidators, Creditors' Voluntary Winding Up, Companies Liquidation Account, Ad Valorem Fees, Committee of Inspection
Source Language
EN
Company Law Insolvency Law Statutory Interpretation Provisional Liquidators Creditors' Voluntary Winding Up Companies Liquidation Account Ad Valorem Fees Committee of Inspection

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Parties

MF Global Hong Kong Limited

Company (debtor)

MF Global Holdings HK Limited

Company (debtor)

Patrick Cowley; Fergal Power; Lui Yee Man (joint & several provisional liquidators, KPMG)

Applicant (provisional Liquidators)

Official Receiver

Respondent (official Receiver)

Procedural Posture

Companies (winding‑up) / Application for Conversion to Creditors' Voluntary Winding Up and Determination of Statutory Payment/fee Obligations

Legal Issues

  1. 1 Whether the court should convert court winding up into creditors' voluntary winding up and appoint the provisional liquidators as liquidators
  2. 2 Whether committees of inspection of specified composition should be appointed
  3. 3 Whether provisional liquidators holding office under section 194(1)(aa) are 'liquidator' for the purposes of section 202(1) of the Companies Ordinance and therefore required to pay realisations into the Companies Liquidation Account and attract ad valorem fees under the Companies (Fees and Percentages) Order

Ratio Decidendi

The court exercised its discretion to convert both court windings into creditors' voluntary windings, appoint the provisional liquidators as joint and several liquidators and establish committees of inspection; crucially, the court held that a provisional liquidator who continues in office by virtue of section 194(1)(aa) is not a 'liquidator' for the purposes of section 202(1) of the Companies Ordinance, and therefore sums realized by such provisional liquidators are not required by that provision to be paid into the Companies Liquidation Account and do not attract ad valorem fees under the Fees Order (any legislative anomaly to be addressed by statute).

Court Disposition

Application granted in part: conversions granted; provisional liquidators appointed as joint and several liquidators; committees of inspection appointed; court held s202(1) does not apply to provisional liquidators in office under s194(1)(aa).

Orders

  • Both windings up converted into creditors' voluntary winding up pursuant to section 209A
  • Patrick Cowley, Fergal Power and Lui Yee Man (KPMG) appointed as joint and several liquidators under section 194(1)(c) of the Ordinance