SCHINDLER LIFTS (HONG KONG) LTD v. NIKKO SERVICES LTD

HCCW 41/2014

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) PROCEEDINGS NO 41 OF 2014

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D E C I S I O N

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1. On 31 March 2014, I handed down my decision in this petition.  I ordered that the petition be adjourned to 14 April 2014 on the following basis:  that unless the company pays the petitioner $49,820 by 4 pm on 11 April 2014, the company be wound up on 14 April 2014.

2. The company did not pay $49,820, or any other sum, to the petitioner within the specified time period. 

3. The company was, again, represented before me by Mr Lau Chun‑ming who is a director.  It appears that the company proposes to appeal my decision, or certainly did intend to do so at the commencement of the hearing.  However, the following was agreed during the course of the hearing, namely, that the petition be adjourned for a further four weeks in order that the company could pay the petitioner $49,820, failing which the company would be automatically wound up. 

4. I will, therefore, make the following order.

5. Unless the company pays the petitioner $49,820 by 4 pm on 9 May 2014, the company shall be wound up on 19 May 2014. The attendance of the parties, if the company is to be wound up on 19 May, be dispensed with.

6. I would add the following comment.  It seems to me that it is appropriate in respect of any further applications to be made in any proceedings between the petitioner and the respondent, for consideration to be given as to whether or not the company should be given leave to be represented by a director.

7. The normal rule is that a company should be represented by a firm of solicitors.  Business people who choose to use companies incorporated under the terms of the Companies Ordinance are, to some extent, taking advantage of the regime established by that Ordinance which protects them from liability for debts incurred by a company. 

8. There is a danger in a court being too lenient in allowing companies to be represented by directors.  The first is, of course, that it may allow the company to run up legal costs of opponents because it is not exposed in the same way itself.  Secondly, it results in the court’s time being wasted as a result of an entity which in itself is fairly sophisticated, not being able to represent its own interests in a proper and an informed way before the court because the shareholders of the company are not prepared to finance its operations, which necessarily may include legal fees, properly.

(Submissions re HCCW 251/2010 and costs)

9. I will adjourn the other petition until 19 May.