LO SHING CHI v. THE SECRETARY FOR JUSTICE

HCMP 2844/2001

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2844 OF 2001

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J U D G M E N T

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1. The Applicant is the liquidator of a company which had carried on the business of trading fabrics. In 1991, the Company sold certain goods to a company by the name of Queen's (Lun Kee) Garment Manufacturing Co. Ltd. which I shall refer to as "Queen's", for $1.6 million. Queen's was subsequently wound up and the Company put in a proof of debt in Queen's winding up.

2. In 1999, the Company resolved itself to go into liquidation. Since the Company was solvent, the liquidation was by way of a members' voluntary winding up. The Company was dissolved in May 2000.

3. Three months later, in August 2000, the Company's liquidator received a notice from Queen's liquidators to the effect that a dividend in the sum of about $195,000.00 was payable to the Company. However, as the Company had already dissolved by then, under Section 292(1), the effect was that all the rights of the Company became bona vacantia accruing to Government.

4. However, Section 292(2) says that Section 292(1) is subject and without prejudice to any court orders under Section 290. Under Section 290(1), in the case of a company which has been dissolved under amongst others Section 248, the court may, at any time, within two years of the date of the dissolution, on an application being made for the purpose by the liquidator of a company, make an order upon such terms as the court thinks fit declaring the dissolution to have been void, and thereupon such proceedings may be taken as might have been taken if the company had not been dissolved. Section 248 is the reference to the dissolution of the Company in a members' voluntary winding up.

5. The Applicant here is the liquidator of the Company. The application has been made within two years of the date of dissolution under Section 248(4) and in this case there is good ground for declaring the dissolution to have been void in order that the Company should get the benefit of this dividend which should rightly belong to the Company. The Secretary for Justice has indicated (albeit recently) that she does not object to the Originating Motion and therefore I would declare that the dissolution of the Company be void under Section 290 and I will further make an order in terms of paragraphs 4, 5, 6 and 7 of the Originating Motion.