Hong Kong Judgment

Court of First Instance

RE RATONAL INDUSTRIAL LTD

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Source document

01

Holding and result

The court held there was no abuse of process in presenting the petition, no valid basis was shown to set aside the Labour Tribunal award, and no useful purpose would be served by adjourning for the Company to file evidence; consequently the Company was ordered to be wound up and the petitioner’s costs were to be paid out of the Company’s assets.

Court disposition

Company ordered to be wound up

Orders

  • Order to wind up Ratonal Industrial Limited
  • Petitioner’s costs to be paid out of the Company’s assets

02

Material facts

Parties

Ho Hoi Tung

Petitioner Counsel: Mr Joseph Lo of Legal Aid Department

Ratonal Industrial Limited

Company (respondent) Counsel: Mr Jonathan Chu, instructed by Messrs Keith Ho & Co.

Official Receiver

Official Receiver Counsel: Miss Vivian Yeung

Amounts and remedies

  • Judgment Debt: HKD 403,334.9

03

Procedural history

  1. Posture

    Winding Up Petition (insolvency) / Hearing and Order Made

04

Questions and positions

Legal issues

Party arguments

Applicant
Petitioner relied on a Labour Tribunal award for arrears of wages (LBTC No.6626/2004) for $403,334.90 and sought a winding-up order; petitioner’s solicitors in earlier proceedings had been informed and raised no objection to a winding-up on this petition.
Respondent
Company argued the petition was an abuse of process because an earlier just and equitable winding-up petition (HCCW No.1193/2002) remained pending and sought to set aside the Labour Tribunal award claiming it was unaware of the proceedings; requested leave for a director to represent the Company and sought adjournment but filed no evidence and provided no valid basis to set aside the award.

05

Court’s reasoning

  1. 01

    High Court judgment (this case) and insolvency practice under Cap. 32

    A winding-up petition founded on an unpaid judgment or award may be proceeded with where there is no valid defence to the judgment

  2. 02

    High Court judgment (this case)

    A merely pending related winding-up petition does not automatically render a subsequent petition an abuse of process

  3. 03

    High Court judgment (this case)

    Lack of awareness of Labour Tribunal proceedings, without more, is not a sufficient ground to set aside a Labour Tribunal award

06

Ratio, limits and disposition

Ratio decidendi

The court held there was no abuse of process in presenting the petition, no valid basis was shown to set aside the Labour Tribunal award, and no useful purpose would be served by adjourning for the Company to file evidence; consequently the Company was ordered to be wound up and the petitioner’s costs were to be paid out of the Company’s assets.

Obiter and limits

  • Director’s absence from earlier set-aside hearings and failure to adduce evidence weighed against granting relief to set aside the award
  • Solicitors for the earlier proceedings having been informed and raising no objection supported proceeding with this petition
  • An adjournment was unnecessary where no adequate basis for challenge to the award had been presented

Court disposition

Company ordered to be wound up

  • Order to wind up Ratonal Industrial Limited
  • Petitioner’s costs to be paid out of the Company’s assets

Source and reliance status

Court of First Instance · 24 July 2006

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Judgment text

The complete available source text.

Source document

Court of First Instance

Judgment· 24 July 2006

RE RATONAL INDUSTRIAL LTD

bjbj [mi gP Cap. 32 of the Laws of Hong Kong ____ Before: Hon Kwan J in Court Date of Hearing: 24 July 2006 Date of Judgment: 24 July 2006 ___

J U D G M E N T ___ This is a petition presented by Ho Hoi Tung against Ratonal Industrial Limited ( the Company ). The petition was presented on the basis of an award made by the Labour Tribunal being a claim for arrears of wages in LBTC No. 6626 of 2004 on 17 December 2004. The Company was ordered to pay the petitioner $403,334.90. A demand for the judgment debt was served on the Company on 25 2005. When the petition came before me on 17 July 2006, I adjourned the petition for one week for the Company to seek leave for one of its directors to represent the Company. The director who was present in court, Mr Tung Ka Hung was told very clearly that if the Company should wish to file any evidence in opposition, this should be done before the end of last week. The Company has appeared by counsel today, but has not filed any evidence in opposition. Mr Jonathan Chu submitted for the Company that the petition is an abuse of process of the court as there is existing another petition to wind up the Company on the just and equitable ground in HCCW No. 1193 of 2002, and this petition has not been dealt with. This does not amount to an abuse of process. I note also that the solicitors for the petitioner in the earlier proceedings have been told of the present petition, and they have no objection to a winding-up order on this petition. Mr Chu informed the court that the Company

has applied to set aside the Labour Tribunal award. However, it would appear from the orders made by the Labour Tribunal on 10 November 2005 and 25 March 2006 that the Company s applications were refused. Mr Chu has not been able to tell this court any reason or basis for the Company s application to set aside the Labour Tribunal award, save that the Company was not aware of the proceedings brought in the Labour Tribunal or the judgment entered against it. This in itself is not a sufficient reason to set aside the award. I note also that in the two previous applications of the Company to set aside the award, its director, Mr Tung, did not attend the hearing. He had written to the Labour Tribunal in March this year informing the court that he was away on a business trip, and he sought an adjournment of his application to set aside the award to July 2006. Nothing that counsel has informed me today would form any valid basis to set aside the Labour Tribunal award. I see no purpose to be served with any adjournment to give the Company opportunity to file evidence in opposition. I make an order to wind up the Company. The petitioner s costs are to be paid out of the Company s assets. (S Kwan) Judge of the Court of First Instance High Court Mr Joseph Lo of Legal Aid Department, for the Petitioner Mr Jonathan Chu, instructed by Messrs Keith Ho & Co., for the Company Miss Vivian Yeung, for the Official Receiver

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Authorities

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Cap. 32 of the Laws of Hong Kong

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