WONG WAN HUEN FREDERICK AND OTHERS v. W HAKING ENTERPRISES LTD. AND OTHERS

WONG WAN HUEN FREDERICK AND OTHERS v. W HAKING ENTERPRISES LTD. AND OTHERS

The court granted the s 182 validation order without imposing an escrow condition because the company was shown (or not disputed) to be solvent, the board had reasonably concluded the dispositions were expedient to discharge borrowings and restore working capital, and under In re Burton & Deakin the court should normally sanction such dispositions absent compelling evidence they would injure the company.

Citation
WONG WAN HUEN FREDERICK AND OTHERS v. W HAKING ENTERPRISES LTD. AND OTHERS
Parties
1st Petitioner: Wong Wan Huen Frederick; 2nd Petitioner: Wong Wan Cham Herbert; 3rd Petitioner: Wong Wan Hay Ronald; 4th Petitioner: Carmenski Wongo Limited; 1st Respondent: W Haking Enterprises Limited; 2nd Respondent: Wong Siu Ling; 3rd Respondent: Wong Wan Chee Ernest; 4th Respondent: Wong Wan Chiu Ignatius; 5th Respondent: Chan Chiu Kam Pauline; 6th Respondent: Palic Investment Limited; 7th Respondent: Chan Wai Fun Winnie; 8th Respondent: Chung Hai Yen
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
26 February 2001
Case Number
HCCW1166/2000
Procedural Posture
Companies Winding Up Proceedings / Interlocutory Application for Validation Order Under S 182 (companies Ordinance Cap.32) Heard 26 Feb 2001
Outcome
Validation order granted
Legal Topics
Validation Order, Dispositions of Company Property, Winding Up Petition, Directors' Powers, Solvency
Source Language
EN
Company Law Insolvency Civil Procedure Validation Order Dispositions of Company Property Winding Up Petition Directors' Powers Solvency

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Parties

Wong Wan Huen Frederick

1st Petitioner

Wong Wan Cham Herbert

2nd Petitioner

Wong Wan Hay Ronald

3rd Petitioner

Carmenski Wongo Limited

4th Petitioner

W Haking Enterprises Limited

1st Respondent

Wong Siu Ling

2nd Respondent

Wong Wan Chee Ernest

3rd Respondent

Wong Wan Chiu Ignatius

4th Respondent

Chan Chiu Kam Pauline

5th Respondent

Palic Investment Limited

6th Respondent

Chan Wai Fun Winnie

7th Respondent

Chung Hai Yen

8th Respondent

Procedural Posture

Companies Winding Up Proceedings / Interlocutory Application for Validation Order Under S 182 (companies Ordinance Cap.32) Heard 26 Feb 2001

Legal Issues

  1. 1 Whether dispositions and payments made by the company after presentation of the winding-up petition should be validated under s 182
  2. 2 Whether validation of sale of five capital assets should be conditional on placing net sale proceeds in escrow
  3. 3 What evidential onus applies where a solvent company seeks validation and contributories oppose

Ratio Decidendi

The court granted the s 182 validation order without imposing an escrow condition because the company was shown (or not disputed) to be solvent, the board had reasonably concluded the dispositions were expedient to discharge borrowings and restore working capital, and under In re Burton & Deakin the court should normally sanction such dispositions absent compelling evidence they would injure the company.

Court Disposition

Validation order granted