CHAN KENG TAI v. THE REGISTRAR OF COMPANIES

HCMP 2281/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2281 OF 2004

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J U D G M E N T

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1.  This is an application made under section 290 of the Companies Ordinance, Cap. 32.

2.  The applicant, Chan Keng Tai, seeks an order that the dissolution of On Tai Loy Enterprises Limited (“the Company”) be declared void, that he be appointed the liquidator of the Company, and other consequential directions be made.

3.  The matters giving rise to the application may be stated as follows.

4.  The Company was incorporated on 13 December 1974.  It had carried on the business of a knitting factory under the name of Yue Tai Knitting Factory.  There were two shareholders, Madam Chan Pui Woo and the applicant.  The two shareholders and one Chiu Kam Cheung were the only directors, until Mr Chiu resigned on or about 3 January 2003.

5.  In mid 2003, Madam Chan and the applicant decided to wind up the Company as they wanted to retire.  They inquired into the financial position of the Company and came to the view that it was solvent and that the Company would be able to pay off its debts.

6.  On 4 July 2003, a directors’ meeting was held.  The board resolved to wind up the Company by members’ voluntary liquidation as the Company was solvent, and an extraordinary general meeting was convened for that purpose.  On 15 July 2003, the directors made a declaration of solvency pursuant to section 233.

7.  The extraordinary general meeting was held on 26 July 2003.  A special resolution was passed for the voluntary winding up of the Company and the appointment of the applicant as the liquidator.

8.  Subsequently, the applicant carried out his duties as the liquidator of the Company.

9.  On 8 August 2003, the applicant put a notice in the gazette notifying creditors to send in their claims to him by 8 September 2003.  Pursuant to section 239, he gave notice of the final meeting dated 19 September 2003 that he had scheduled the final meeting on 20 October 2003 for the purpose of passing a resolution that the books, accounts and documents of the Company were to be retained by the liquidator and at the expiration of 3 months from the date of dissolution be destroyed.

10.  On 20 October 2003, the final meeting was held and the applicant laid before the meeting a statement of account showing how the assets of the Company were disposed of.  The proposed special resolution for the retention and destruction of books and documents was passed.  The statement of account was filed with a return of the final meeting at the Companies Registry on 22 October 2003.  By reason of section 239(4), the Company was deemed to be dissolved on or about 22 January 2004.

11.  The applicant had inadvertently forgotten that the Company had another asset, being a car parking space marked number 499 on the upper level car park of Nos 41-59 Broadway and Nos 6-8 Glee Path, Mei Foo Sun Chuen Stage III, Kowloon.  The car parking space did not appear in the assets listed in the statement of account laid before the final meeting.

12.  By an assignment dated 5 March 2004, the applicant purportedly assigned the car parking space on behalf of the Company to the purchaser for HK$290,000.00, the applicant and Madam Chan had also executed the assignment as confirmors.

13.  By a letter dated 12 March 2004, the purchaser’s solicitors questioned the title and the applicant’s competence to assign and suggested that he should apply for an order declaring the dissolution of the Company to be void so that the car parking space could be vested in the Company or in the applicant again.

14.  As the Company has been dissolved, it has no right to assign the car parking space.  The property in the car parking space is vested in the Government as bona vacantia.

15.  On 13 August 2004, the Registrar of Companies advised the applicant’s solicitors by letter that the Government has no objection in principle to relinquish its claim over the car parking space.

16.  The originating summons was issued on 6 September 2004.

17.  The Registrar of Companies being the respondent to this application has not appeared today, as an agreement was reached with the applicant’s solicitors on the reliefs sought and on costs.

18.  It would be appropriate in the circumstances to make the declaration and the consequential directions to enable the Company to deal with a property which was inadvertently overlooked in the process of liquidation.

19.  I make an order in terms of the draft submitted to me.