RE SHANGHAI HUAXIN GROUP (HONG KONG) LTD

RE SHANGHAI HUAXIN GROUP (HONG KONG) LTD

Because the company's solicitors provided contradictory and inconsistent explanations and failed to answer the court's questions, causing unnecessary hearings and filings, the court made the winding up order, ordered ordinary costs to be paid from company assets except for the hearing on 27 August 2018, and directed the company's solicitors to show cause why they should not pay personally the wasted costs of that hearing and the provisional liquidators' affirmation of 29 August 2018.

Citation
[2018] HKCFI 2082
Parties
Petitioner: Harbour Vanguard Limited; Company/respondent: Shanghai Huaxin Group (Hong Kong) Limited; Joint Provisional Liquidators: PricewaterhouseCoopers (partners); Official Receiver: Official Receiver; Supporting Creditor: SPDB International Investment Management Limited; Supporting Creditor (attendance Excused): China Cinda (HK) Asset Management Co, Limited; Supporting Creditor (watching Brief): China Huarong International Holdings Limited; Supporting Creditor (absent): Singapore AnAn Petrochemical & Energy Pte Ltd; Supporting Creditor (absent): Lorwin
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
3 September 2018
Case Number
HCCW126/2018
Procedural Posture
Companies Winding Up Petition / Winding Up Order Made; Show Cause Directed to Solicitors
Outcome
Winding up order made
Legal Topics
Winding Up, Provisional Liquidators, Wasted Costs, Show Cause, Solicitor Instructions
Source Language
EN
Company Law Insolvency Civil Procedure Costs Professional Conduct Winding Up Provisional Liquidators Wasted Costs +2 more

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Parties

Harbour Vanguard Limited

Petitioner

Shanghai Huaxin Group (Hong Kong) Limited

Company/respondent

PricewaterhouseCoopers (partners)

Joint Provisional Liquidators

Official Receiver

Official Receiver

SPDB International Investment Management Limited

Supporting Creditor

China Cinda (HK) Asset Management Co, Limited

Supporting Creditor (attendance Excused)

China Huarong International Holdings Limited

Supporting Creditor (watching Brief)

Singapore AnAn Petrochemical & Energy Pte Ltd

Supporting Creditor (absent)

Lorwin

Supporting Creditor (absent)

Procedural Posture

Companies Winding Up Petition / Winding Up Order Made; Show Cause Directed to Solicitors

Legal Issues

  1. 1 Whether the company should be wound up for insolvency
  2. 2 Whether provisional liquidators should be appointed to avoid hiatus at commencement of liquidation
  3. 3 Whether solicitors should be personally liable for wasted costs arising from inconsistent instructions

Ratio Decidendi

Because the company's solicitors provided contradictory and inconsistent explanations and failed to answer the court's questions, causing unnecessary hearings and filings, the court made the winding up order, ordered ordinary costs to be paid from company assets except for the hearing on 27 August 2018, and directed the company's solicitors to show cause why they should not pay personally the wasted costs of that hearing and the provisional liquidators' affirmation of 29 August 2018.

Court Disposition

Winding up order made

Orders

  • Order for the winding up of Shanghai Huaxin Group (Hong Kong) Limited
  • Costs of the petitioner, the Official Receiver, and the provisional liquidators to be paid out of the assets of the Company, save for the hearing on 27 August 2018