RE LUCKY RESOURCES (HK) LTD

HCCW 89/2016

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO 89 OF 2016

____________

____________

___________________

D E C I S I O N

___________________

1.  I have before me a petition to wind up the company on the grounds of insolvency. The petition states that on 5 February 2016, a final arbitration award was issued in the petitioner’s favour in the sum of US$1,444,499.61 plus interest. On 24 February 2016 the petitioner through its solicitors issued a statutory demand. The petition was issued on 24 March 2016.

2.  On 30 June 2016 an affidavit was filed on behalf of the company made by its solicitor setting out grounds for contesting the petition.  In paragraphs 22 to 23 of the affidavit it is asserted that the debt is genuinely disputed on substantive grounds, but no grounds for disputing the debt are given other than the one set out in the earlier passages of the affidavit which takes a technical point, namely that the petition has been improperly presented because the petitioner has not made an application pursuant to section 84 of the Arbitration Ordinance (Cap 609) to enforce the award.

3.  Mr Maurellet SC who appeared before me this morning on behalf of the petitioner argues that it is clear from the authorities that, the presentation of a winding‑up petition does not constitute enforcement of the award and section 84 of the Arbitration Ordinance is irrelevant.  I agree.  It seems to me to be clear from the authorities that this court and courts in other jurisdictions have determined the presentation of a petition to wind‑up a company on the grounds of insolvency is the exercise of a class right and does not constitute enforcement of either a judgment or, as is relevant in the present case, an arbitration award.[1]

4.  As Mr Maurellet drew to my attention the current position is most succinctly summarised in Applications To Wind Up Companies (3^rd ed, 2015), Derek French paragraph 7.61 in which the author says in the context of the current English Act:

“The presentation of a petition to wind up a company based on non-payment of an arbitration award against the company in the petitioner’s favour is not an enforcement of the arbitration award¹⁷⁷ and so does not require leave under the Arbitration Act 1996, s 66.¹⁷⁸”

In my view the position is exactly the same in Hong Kong under our Arbitration Ordinance.

5.  Mr Ng who appeared for the company was only able to identify one authority, which he suggested, indicated a contrary view and which justified in his submission adjourning the petition for longer and more comprehensive argument, namely, the decision of the Malaysian Court of Appeal in Mobikom Sdn Bhd v Inmiss Communications Sdn Bhd [2].  

6.  It seems to me that that particular decision does not address the specific issue that I have to determine.  In that case the Malaysian Court of Appeal was concerned with whether or not winding‑up proceedings were an appropriate venue in which to determine a dispute about the validity or otherwise, of the underlying issues in arbitration proceedings after an arbitration award had been issued and pending a determination of an attempt to set aside that award.  That seems to me to be a very different issue to the one with which I am concerned today.  I will therefore make the normal winding up order.