RE CHINA SOLAR ENERGY HOLDINGS LTD (formerly named REXCAPITAL International Holdings Ltd)

HCCW 108/2015

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) PROCEEDINGS NO. 108 OF 2015

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D E C I S I O N

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1.  This is the Petitioner’s application for leave to appeal against the decision of this court dated 30 March 2017 (Decision)[1].

2.  There is one argument advanced by Mr Chan, appearing for the Petitioner.  It was set out in para 29 of the Decision.  It has been reformulated in the draft Notice of Appeal (para 1 of the grounds of appeal) as follows.  When the PLs’ sole or primary function “at the current stage” has become corporate recuse only, they should resign and let the company manage the restructuring plan. 

3.  With respect, I shall deal with the argument swiftly.  First of all, the Company agreed with and supported the PLs’ applications before the court on 30 March 2017.  It is very difficult therefore to see any substance in the argument. 

4.  Secondly, it was held (para 29 of the Decision) that the court was unable to understand the logic or sense in the argument. Despite the 19 pages of written submissions from the Petitioner and Mr Chan’s oral submissions, this remains the position.

5.  Thirdly, as submitted by Mr Smith SC for the PLs, the “current stage” has not changed materially from the circumstances prevailing at the time when the PLs were appointed, ie, the assets of the Company, in particular its listing status, remain at risk.  Therefore, this ground of appeal is unarguable.

6.  Insofar as it is argued by the Petitioner, relying on an authority from the High Court of Kuala Lumpur of Yeoh Eng Kong v Dato’ Nik Ismail b in Nik Yusoff & Ors [2016] MLJU 936 (19 September 2016), that the listing status of a company cannot constitute an “asset in jeopardy” which justifies the appointment of provisional liquidators, I am unable to agree. 

7.  I do not see the issue as whether a listing status is or is not legally an asset.  In the context of liquidation, the court has long recognised the value of a listing status the realisation of which can go a long way to paying the creditors (see also para 19 of the Decision).  I am unable to find anything in the point. 

8.  Finally, both the PLs and HF, represented by Mr Chong appearing with Mr Lam, argued that the Petitioner has been inconsistent in that it had previously supported the appointment of the PLs and resisted their discharge.  I agree, and I believe that this reflects the observation in the Decision (para 17) that the process of the court is being used by the Petitioner for some ulterior purpose.

9.  It is lamentable that the court’s resources are being wasted for another groundless and pointless application.  Observations such as those made by the Court of Appeal in Lau Tin Cheung v Tianjin Development Holdings Ltd, HCMP 1018/2015, unrep, 27 May 2015, §10-11 (Lam VP) are simply ignored. 

10.  In the premises, this application is dismissed, and I shall hear Mr Chan on why the costs of this application should not be awarded on indemnity basis.

[Submissions on costs of the application]

11.  I order that the costs of and occasioned by this application be paid by the Petitioner on indemnity basis to be taxed, if not agreed, and paid forthwith.  I decline to grant a certificate for two counsel for HF.  I agree with Mr Chan that the positions taken by both the PLs and HF are identical, and that the PLs already have the benefit of representation by senior counsel.