Bank of Baroda v. Psons Ltd (Formerly Known As Pson Ltd and Psons Ltd)

HCCW 162/2016

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) PROCEEDINGS NO 162 OF 2016

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JUDGMENT

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1.This is an application by the contributories to rescind a winding-up order.

2.The winding-up order was made on 17 February 2017.  The summons to rescind the winding-up order was issued on 7 March 2017.

3.No evidence has been filed in support of the summons, despite many requests and inquiries as to the progress of the matter regarding today’s hearing.  A consent summons was received after hours on Friday 6 October but was not seen by this court until this morning.  The consent summons was to withdraw the summons to rescind the winding-up order.  It has been signed by the solicitors for the contributories, the petitioner, and by the Official Receiver and the Registrar of Companies (their costs having been provided for) but not by Glencore International AG (“Glencore”), a creditor of the company that had given notice of its intention to resist the summons as early as 28 July 2017. 

4.During the morning of 6 October, Glencore served its skeleton submissions, and it will be seen that it complained that no reasons supporting the application had been made by the contributories in support of the summons, putting it in a difficult position.  Glencore made it clear that it would be seeking indemnity costs.

5.The court has already outlined the chronology. This is a case where I take the view that indemnity costs should be awarded to Glencore.  When a company has been wound up, a summons to rescind that winding-up order must be supported by very strong grounds.  The requirements are well-known and not in dispute.  But here, there is simply nothing filed in support of the summons.  There was merely a passing reference in the correspondence to the fact that the court would be requested to read certain lengthy accountancy documents. 

6.I take the view that the attitude taken in pursuit of the summons verges on an abuse of process.  The summons should not have been taken out in the first place.  At best, the contributories were optimistic at that time that good reason would come into existence.  In those circumstances, I see no reason why indemnity costs should not be awarded to Glencore. 

Mr Michael Lok, instructed by Wilkinson & Grist, for the petitioner

Mr Edward Alder, instructed by Reynolds Porter Chamberlain, for the respondent

Mr Justin Lam, instructed by Clyde & Co, for the intervener