RE MEMORY DEVICES LTD

HCCW 71/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 71 OF 2009

____________

____________

AND

HCCW 52/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 52 OF 2009

____________

____________

AND

HCCW 53/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 53 OF 2009

____________

____________

(Heard Together)

______________

J U D G M E N T

______________

1.  I have before me 3 petitions listed to be heard together.  HCCW No. 71 of 2009 is a petition presented by the Hongkong and Shanghai Banking Corporation (“HSBC”) against Memory Devices Limited.  This is a company incorporated in Bermuda and listed on the Singapore Stock Exchange.  The other 2 petitions, HCCW Nos. 52 & 53 of 2009, are presented by the Standard Chartered Bank in respect of Willlink Technologies Limited (“Willlink Technologies”) and Memory Devices (HK) Limited (“Memory Devices (HK)”).  These are the subsidiaries of Memory Devices Limited, both are companies incorporated in Hong Kong.

2.  Memory Devices Limited is not registered under Part XI of the Companies Ordinance, Cap. 32, but it has a principal place of business in Hong Kong and it is involved itself or through its subsidiaries in Hong Kong in the manufacture and wholesale of electronic devices including memory cards and adaptors for mobile phone companies.

3.  On 28 April 2008, Memory Devices Limited granted a guarantee to HSBC pursuant to which it secured the obligations owed by Memory Devices (HK) and Willlink Technologies in respect of facilities granted by HSBC to these subsidiaries.  Pursuant to the guarantee, Memory Devices Limited agreed to pay HSBC on demand all sums of money owing to the extent of US$15 million with interest.

4.  As at 24 November 2008, the two subsidiaries in Hong Kong are indebted to HSBC of over US$15 million under the facilities.  On that same day, HSBC served a statutory demand on Memory Devices Limited to pay the outstanding sum due under the guarantee to the extent of US$15 million.  The petition was served on Memory Devices Limited on 6 February 2009.

5.  Regarding Willlink Technologies and Memory Devices (HK), Willlink is indebted to the Standard Chartered Bank in the sum of HK$127,395.71 and US$2,785,419.20, being the outstanding balance of bank loans granted to it by the bank.  Memory Devices (HK) is indebted to the bank of these amounts as the guarantor of Willlink Technologies under a guarantee dated 15 May 2008 in favour of the bank by which Memory Devices (HK) guaranteed to pay and discharge on demand all monies advanced to Willlink.

6.  Memory Devices (HK) is also indebted to the bank in the sum of HK$537.13 and US$4.52 being the outstanding balance of the bank loans granted to it by the bank.  And Willlink Technologies is indebted to the bank of the same sums as the guarantor of Memory Devices (HK) under a guarantee dated 15 May 2008 in favour of the bank.

7.  The Standard Chartered Bank served statutory demands on both subsidiaries on 22 December 2008.  The petitions for winding up were served on both companies on 2 February 2009.  The subsidiaries are not legally represented.  No evidence has been filed to dispute the debts pursued by the Standard Chartered Bank.  I make an order to wind up each of the subsidiaries.

8.  As for the parent company, Memory Devices Limited, Mr Benny Lo sought an adjournment to file evidence for two broad purposes.  Firstly, he submitted that the debt pursued by HSBC is in dispute in that Memory Devices Limited would dispute the validity of the guarantee it executed on 28 April 2008 on the ground of non est factum.  Mr Lo was not able to inform the court of any particulars or factual basis upon which that defence is raised.  I refuse to grant an adjournment for that purpose.

9.  The other ground for an adjournment is that it is contended by the company it should be given an opportunity to file evidence to dispute the basis on which the court should exercise its jurisdiction to wind up this company as it is an unregistered foreign company.  This ground of disputing the jurisdiction of the court to wind up the parent company is also raised at the last moment.  On the available evidence before me, I am satisfied there is a sufficient connection of Memory Devices Limited with Hong Kong.

10.  As mentioned earlier, the parent company has a principal place of business in Hong Kong, and has been conducting business in Hong Kong through two subsidiaries incorporated in Hong Kong.  That there are other subsidiaries of the company not incorporated in Hong Kong is beside the point.

11.  I am also satisfied that in the event an order is made to wind up Memory Devices Limited by this court, there would be a reasonable possibility of benefit to the creditor or creditors applying for a winding-up order.  There would be persons in Hong Kong over whom the court can exercise its jurisdiction who are interested in the distribution of the company’s assets.  For these reasons, I do not think it would serve any or any useful purpose for an adjournment to be given for the company to adduce evidence.

12.  As there is no or no substantial basis on which the petitioning debt is disputed and I am satisfied this is an appropriate case for the court to exercise its jurisdiction to wind up this foreign unregistered company, I will make a winding-up order accordingly.

13.  The petitioners’ costs are to be paid out of the assets of each of the companies concerned.