RE BGA HOLDINGS LTD (Formerly Known as BEIBU GULF OCEAN SHIPPING (GROUP) LTD)

HCCW 251/2019

[2021] HKCFI 3915

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) PROCEEDINGS NO 251 OF 2019

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JUDGMENT

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1.  By a Decision of the court dated 26 November 2021, the Company’s application to strike out the Amended Petition was dismissed. It was held, inter alia, that there was no bona fide dispute to the PBM Loan (adopting the nomenclature used in the Decision).

2.  It should be noted that the statutory demand by which repayment of the PBM Loan was sought was dated 12 December 2017, nearly four years ago.  The Petition was issued on 23 August 2019, more than two years ago.

3.  Pursuant to the Order of Mr Justice Harris dated 2 December 2019, it was ordered that the Amended Petition be adjourned to the second Monday following the handing down of the Decision on the strike out application.  This is the resumed hearing of the Amended Petition.

4.  Expectedly, the Petitioner seeks to have the Company wound up this morning because of its insolvency.  On the other hand, the Company seeks a “short adjournment” so as to allow its application for leave to appeal against the Decision and the stay of execution pending appeal heard before the determination of Amended Petition.

5.  The applicable principles concerning a stay of execution are trite: see Re China Silver Asset Management (HK) Ltd [2020] HKCFI 1028, §§10 & 11).

6.  Although this is an adjournment application, the effect is nevertheless a temporary stay of the consequence of the Decision.  I should add that, given the proposal for filing of evidence, it is unlikely that the leave and stay applications will be determined within a short period of time.  I therefore see no reason not to apply the aforesaid principles.

7.  There is no evidence at all before the court that the Company is able to honour its debts.  The court must bear in mind that the PBM Loan is in excess of US$36 million.

8.  The court has been informed that there is no challenge to the Decision on the Authority Ground.  Thus, the proposed appeal will be one over the findings of fact by the court.  On the factual issues, it was held in the Decision, inter alia, that the Company’s case was full of holes (§72).

9.  I struggle to find a valid reason why these matters should be further delayed.  I am unable to accept the Company’s submission that the Petitioner has suffered no prejudice by reason of the delay.  It is self-evident that the delay of nearly four years since the issue of the statutory demand is prejudicial to a creditor.

10.  For these reasons, I make the usual winding up order with costs against the Company.