Hong Kong Case Law: Decisions & Judgments | LexChat

Topic

Conflict of interest in appointments

Legal area

Court

15 Sept 2021

RE LT COMMERCIAL LTD (In Creditors’ Voluntary Liquidation)

Citation

[2021] HKCFI 2867
Court

Court of First Instance
Case number

HCCW261/2021

The court granted the application to appoint Mr So Man Chun and Mr Jong Yat Kit as provisional liquidators and expressly granted leave under s262B(3)(a) because practical necessity to avoid operational hiatus and to facilitate Mainland proceedings outweighed any theoretical conflict; the trustees’ creditor status was technical given the very small debt (approx. 0.24%), and on that basis no material conflict was found to preclude appointment (following the approach in Re Gold Finance).
5 Sept 2002

RE LUEN CHEONG TAI INTERNATIONAL HOLDINGS LTD

Citation

RE LUEN CHEONG TAI INTERNATIONAL HOLDINGS LTD
Court

Court of First Instance
Case number

HCCW584/2002

Given the company's severe financial deterioration, delayed and qualified accounts, significant doubtful assets and related-party transactions raising justifiable suspicions, together with the loss of confidence by the financial creditors in management and a realistic prospect that a winding up order would be made if restructuring failed, it was proper to appoint provisional liquidators to protect assets, investigate and facilitate restructuring; prior limited engagement by Ernst & Young did not disqualify the proposed appointees in the absence of specific evidence of impropriety.