WANG JING DONG v. THE REGISTRAR OF COMPANIES

HCMP 845/2008

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 845 OF 2008

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J U D G M E N T

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1.  This is a notice of originating motion under section 290 of the Companies Ordinance, Cap. 32.

2. The applicant Wang Jing Dong seeks an order that the dissolution of Newland Electronic Company Limited (“the Company”) by the order of a Master on 20 June 2005 be declared void under section  290(1) and that the time for making the application be extended pursuant to section 290(1A).

3.  The applicant was one of the two shareholders of the Company and one of the first directors.  He is a Mainland resident at all times.

4.  The Company was incorporated in May 2001 with an issued share capital of HK$10,000.  The applicant held 9,000 shares.  The other shares were held by his sister.

5.  In September 2001, the Company and an entity in Shenzhen set up a joint venture company in the Mainland.  The joint venture company has been engaged in the design, development and manufacture of electronic products.  The Company’s business was the trading of DVD appliances in Hong Kong.

6.  In 2003, the applicant resigned as a director of the Company to devote more time to the joint venture company.  He and his sister continued to hold all the issued shares in the Company.

7.  A creditor’s petition was presented to wind up the Company on 4 August 2003 and a winding-up order was made on 24 September 2003.  The applicant was too busy with the business of the joint venture company and as he had wanted to terminate the business of the Company any way, he did not engage lawyers to oppose the petition.

8.  On 20 June 2005, an order was made by a Master under section 227 that the Company be dissolved following summary liquidation, upon the application of the liquidators that the affairs of the Company had been completely wound up.  The liquidators were released by an order of the court under section 205.  The applicant did not learn about this until March 2006.  He took no action at the time.  It did not occur to him that the Company should not be dissolved as it has a valuable stake in the joint venture company.

9.  In December 2007, the applicant had a meeting with professional advisers to discuss the listing of the joint venture company on The Stock Exchange of Hong Kong Limited or the Shenzhen Stock Exchange.  He was advised it would be necessary to apply for the restoration of the Company, which has a substantial stake in the joint venture company, before the joint venture company could apply for listing of its shares.

10.  The present application was taken out in May 2008.

11.  Under section 290(1), the application to declare void the dissolution of a company must be made within 2 years of the date of dissolution.  The court has power to extend time under section 290(1A) where there are exceptional circumstances justifying the extension.  The application here is made almost 3 years from the date of the order for dissolution of the Company.  The delay arose because the applicant was ignorant of the legal consequences of the dissolution of the Company.  It would appear that no prejudice has been occasioned to any one by reason of the delay.

12.  Both the Registrar of Companies and the former liquidators have no objection to the application.

13.  I consider it appropriate in the circumstances to exercise my discretion to extend time to make the application and to grant the application.

14.  I make an order in terms of the revised draft order submitted by counsel.