RE CHEONG YIP FINANCE (HONG KONG) LTD

RE CHEONG YIP FINANCE (HONG KONG) LTD

The court refused the stay because it found no sufficiently strong arguable case on the alleged statutory and verification defects given authorities permitting affidavits and notices by authorised agents, and because the Official Receiver's reports raised serious, unrefuted doubts about the company's asserted asset (the Goldhill shareholding) and the true value available to meet the company's indebtedness; on that factual basis continued winding up was in the company's and creditors' interests. The court also ordered contributories to give security for costs of the appeal and ancillary proceedings and awarded costs against them.

Citation
RE CHEONG YIP FINANCE (HONG KONG) LTD
Parties
Company: Cheong Yip Finance (Hong Kong) Limited; Petitioner/creditor: Moscow Narodny Bank; Contributory/applicant: Gregson Limited; Contributory/applicant: Dredson Limited; Official Receiver: Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
21 December 1978
Case Number
HCCW49/1978
Procedural Posture
Companies (winding Up) / Motion to Stay Winding Up Proceedings After Winding Up Order; Appeal Pending
Outcome
Motion to stay dismissed; contributories ordered to provide security for costs of appeal and ancillary proceedings; costs awarded against contributories.
Legal Topics
Winding Up, Stay of Proceedings, Statutory Demand, Verification of Petition, Security for Costs, Appeal Procedure
Source Language
EN
Company Law Insolvency/bankruptcy Civil Procedure Winding Up Stay of Proceedings Statutory Demand Verification of Petition Security for Costs +1 more

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Parties

Cheong Yip Finance (Hong Kong) Limited

Company

Moscow Narodny Bank

Petitioner/creditor

Gregson Limited

Contributory/applicant

Dredson Limited

Contributory/applicant

Official Receiver

Official Receiver

Procedural Posture

Companies (winding Up) / Motion to Stay Winding Up Proceedings After Winding Up Order; Appeal Pending

Legal Issues

  1. 1 Whether the statutory bankruptcy notice complied with section 178 of the Companies Ordinance
  2. 2 Whether the affidavit verifying the petition complied with Rule 26 of the Companies Winding-up Rules
  3. 3 Whether a stay of winding-up proceedings should be granted under section 209

Ratio Decidendi

The court refused the stay because it found no sufficiently strong arguable case on the alleged statutory and verification defects given authorities permitting affidavits and notices by authorised agents, and because the Official Receiver's reports raised serious, unrefuted doubts about the company's asserted asset (the Goldhill shareholding) and the true value available to meet the company's indebtedness; on that factual basis continued winding up was in the company's and creditors' interests. The court also ordered contributories to give security for costs of the appeal and ancillary proceedings and awarded costs against them.

Court Disposition

Motion to stay dismissed; contributories ordered to provide security for costs of appeal and ancillary proceedings; costs awarded against contributories.

Orders

  • Motion to stay the winding-up proceedings dismissed
  • Gregson Limited and Dredson Limited ordered to provide security for costs of the appeal and all ancillary proceedings in the sum of HKD 60,000 and notify the Official Receiver and liquidator