RE PERAK PIONEER LTD

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J U D G M E N T

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1. A creditor's petition No. 141 of 1984 was presented by Carrian Holdings Limited (in liquidation) (the applicant) on the 4th May 1984 to wind up Perak Pioneer Limited (the company) a company in the Carrian Group. The petition is due to be heard on the 10th December 1984.

2. A second creditor's petition No. 231 of 1984 was presented by Bumiputra Malaysia Finance Limited and Bank Bumiputra Malaysia Berhad on the 24th July 1984. An order was also made on the same day appointing the Official Receiver to be the Provisional Liquidator. The second petition is due to be heard on the 26th November 1984.

3. The applicant applies by summons filed on the 13th November 1984 in both sets of proceedings for an order under Section 186 of the Companies Ordinance for leave to commence and thereafter proceed with an application by originating motion for an order under Section 143(1)(a) of the Ordinance declaring that the affairs of the company ought to be investigated by an inspector appointed by the Financial Secretary. Section 186 provides:-

"When a winding-up order has been made, or a provisional liquidator has been appointed,no action or proceeding shall be proceeded with or commenced against the company except by leave of the court, and subject to such terms as the  court may impose."

4. The application is supported by an affidavit sworn by Mr. T.D. Stevenson who is one of the joint liquidators of the applicant in which he avers that there has been grave misconduct and mismanagement of the company's affairs with a total disregard for the interests of its creditors and with no commercial justification. He alleges that although the company is hopelessly insolvent enormous sums of money have been expended to defend both sets of winding up proceedings to the detriment of creditors.

5. Service of the summons was effected upon the Official Receiver, but not upon the company. However, as a matter of courtesy copies were delivered to the solicitors acting for the company on the afternoon of the 13th November so that in any event 2 clear days notice had not been given.

6. Mr. Ma for the applicant submitted that on such an application the company has no locus for the practice only requires Service on the liquidator. He also contended that the company has no interest in the application in the context of the winding up. On the other hand Mr. Osborne who appeared on behalf of the Official Receiver shared the view of Mr. Poon who represented the company that the company has locus.

7. Mr. Poon cited the well known authority of In re Union Accident Insurance Co. Ltd. (1972) 1 W.L.R. 640 which held:-

"that notwithstanding the appointment of a provisional liquidator on a winding up, the board of directors of a company retained the residuary power to instruct solicitors and counsel to oppose the petition and to appeal against the order, and also to act in interlocutory proceedings, including a motion to discharge the provisional liquidator.".

This case was followed in Re Laverton Nickel N.L. and the Companies Act 3 ACLR 945 which was referred to by Mr. Poon.

8. Having regard to the authorities cited I am satisfied that the company is entitled to be represented upon the hearing of the application in 231/1984. Section 186 does not apply to 141/1984 as no provisional liquidator has been appointed. Accordingly, the summons in this petition will be dismissed. The summons in 231/1984 will be adjourned for service to be effected on the company.