Re Trillion Corporation Ltd.

HCCW 1037/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES WINDING UP NO. 1037 OF 2000

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J U D G M E N T

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1. This is a petition for the winding up of a company called Trillion Corporation Limited. The petition is based upon a judgment debt for $13.4 million which judgment was obtained in August 2000. The statutory demand was served in September 2000 and the petition was presented to the Court in November 2000.

2. At the hearing on the last occasion, the Company indicated that it could repay the debt by July 2001 and it exhibited a letter of intent for the sale of a property in April 2001. The property is not owned by the Company but by another company called Trillion Property Limited and according to the evidence, there are some common shareholders of these two companies.

3. There is one Opposing Creditor in the person of Mr Tam Wai Shing who is a director of Trillion Property. He said he has been owed the amount of $800,000. He has, however, not appeared in Court today.

4. On the last occasion, I gave a week's adjournment to the Company so that it could file evidence as to the legality of the letter of intent and as to the Company's financial status. The Company has filed an affirmation but only to show the valuation of the property and the legality of the letter of intent. It has not purported to file any evidence to show the Company's financial position.

5. Today Miss Law for the Company has asked for a further two weeks' adjournment to file evidence of Company's financial position. As I have said, notwithstanding the adjournment given on the last occasion, not even management accounts have been presented to the Court by way of evidence.

6. Mr Wong for the Petitioner has opposed the petition.

7. I would echo with respect the judgment of Godfrey JA (as he then was) in Re. Esquire (Electronics) Ltd [1996] 3 HKC 309, in which he said that petitioning creditors are entitled ex debito justitiae to a winding up order, especially based on a judgment debt. Although there is discretion in the Court to refuse to make an immediate winding up order, it is rare for the Court to exercise its discretion in favour of a stay of the proceedings or an adjournment for an indefinite period, and an adjournment would not in practice be granted at the Company's request against the opposition of the petitioning creditor, except when the Company disputes the debt (which it does not here) and seeks time to present evidence to that effect, or if the petition is founded on a judgment debt, to have the judgment set aside (here the Company does not dispute the judgment debt and is not seeking to set the judgment debt aside).

8. It is of no avail to the Company to say that if only it is given time, it will be able to pay, nor is it any answer to say that the Company has no assets to meet the Petitioner's claim.

9. Accordingly, given the inability of the Company to pay its debts now, even though the judgment debt had been incurred as long ago as August 2000, and given that at best the Company says that it would only be able to get these proceeds of sale in July 2001, I see no reason why I should exercise my discretion to grant an adjournment and therefore I would make the usual winding up order.