JEN KIT JOSEPHINE, THE ADMINISTRATRIX FOR THE ESTATE OF JEN FRANK CHIA HSIANG, DECEASED v. THE REGISTRAR OF COMPANIES

HCMP 1984/2015

MISCELLANEOUS PROCEEDINGS NO 1984 OF 2015

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REASONS FOR DECISION

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1.  This was the substantive hearing of the originating summons taken out by the administratrix (“the applicant”) of the estate of the late Jen Frank Chia Hsiang (“the deceased”) for the restoration of Kwai Chung Enterprises Ltd (“the Company”) to the Companies Register pursuant to section 765(2) of the Companies Ordinance, Cap 622. At the conclusion of the hearing the court made an order in terms of the relief set out in para 38 of the applicant’s reply skeleton that incorporated the terms suggested by the Registrar of Companies in his letter dated 19 January 2016, with costs in favour of the applicant.

2.  The application was initially opposed by the 3^rd respondent who applied for a stay of proceedings on the ground of the applicant’s abuse of process by way of multiplicity of proceedings.  The 3^rd respondent sought an order to stay the application pending the final conclusion of HCA 346/2001 (“the Hong Kong action”) and proceedings commenced by the applicant in British Colombia under S‑149880 (“the Canadian action”).

3.  It was said that the present application shared the same central issue that arises in the Hong Kong action and the Canadian action, namely the mental capacity of the deceased from the year 2000 until his death in 2010.

4.  Upon further analysis of the application, it was clear that the issue that gave rise to the need for the application was not the mental capacity issue that the 3^rd respondent had identified.  Rather, the application was for the restoration of the company to the Companies Register and not a determination of any substantive disputes between the applicant and the 3^rd respondent.  The only issue is whether the company has more than a shadowy prospect of establishing anything of value as it would belong to the estate which the applicant is duty bound to administer.

5.  Mr D’Souza, counsel for the applicant, focused on one item, namely the proceeds of sale of a property owned by the company since 1978 and sold on 16 June 2004.  The applicant is unable to ascertain the whereabouts of the proceeds of sale received by the company.

6.  The solicitors who handled the transaction for the company would only deal with enquiries with the authorisation of the company.  However, the company was deregistered on 18 March 2006 at a time when the shareholders were the deceased (holding 54 shares), the 3^rd respondent (holding 45 shares) and Madam Chou, the deceased’s wife who passed away in 1998 (holding the remaining one share).

7.  Article 23 of the company’s articles provides that on the death of any member, the legal personal representative of such deceased member shall be the only person recognised by the company as having any title to such share (subject to article 22 which, on the facts, is not applicable).  As section 219AA of the Companies Ordinance requires the consent of all the members before any company could be deregistered and as there is no personal representative of the estate of Madam Chou, prima facie it would appear that the deregistration was irregular.

8.  Mr D’Souza submitted that in the circumstances the applicant is an “aggrieved person” under the Companies Ordinance and as this application is made within the 20 year limitation period, it is just for the court to order that the company’s name be restored to the register.

9.  The court granted the 3^rd respondent a short adjournment to consider the matter.

10.  At the resumed hearing, the 3^rd defendant quite properly abandoned her opposition to the relief sought.  Accordingly, the court made the order mentioned above.