Swire Timber Products Ltd v. So Kwok Kuen

CACV000055/1982

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Coram: Hon. Cons, Zimmern JJ.A. & Hooper, J.

Date: 17 June 1982

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JUDGMENT

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Cons, J.A.:

1. This is an appeal from the decision of Liu J. whereby he dismissed a petition for bankruptcy presented on behalf of a limited company. The petition had been presented by the Finance Manager of the company, but at the time he did so he was not authorised under the seal of the company as required by Sec. 126 of the Bankruptcy Ordinance Cap. 6.

2. The learned judge took the view that lack of the seal affected the manager's capacity to act, so that his purported act was "devoid of legal validity and as a nullity could not be ratified". He did not indicate why he took that view, save to say that any other view would be liable to defeat the purpose of the legislation.

3. With respect I take a different view. I see it as a matter of agency rather than as one of capacity. The position is analogous to that which obtained in Danish Mercantile Co. Ltd. v. Beaumont⁽¹⁾, where a solicitor initiated an action in the High Court without the proper authority of his client company. The proceedings were later adopted by the liquidator of the company. It was argued that the action was "an utter and complete nullity so that no amount of subsequent ratification (could) cure the defect''.

4. Jenkins, L.J., after referring to the authorities put forward in support of that proposition, said ⁽²⁾ :

"I find nothing in any of those cases to constrain me to hold that the issue of a writ and the commencing of an action with the authority of the purported plaintiff is a matter which admits of no validation by subsequent ratification of the act of the solicitor concerned. So to hold would be to introduce, as I see it, an entirely novel doctrine into the ordinary law of principal and agent and to make a new exception to the general rule that every ratification relates back and is deemed equivalent to an antecedent authority."

5. For these reasons I would allow the appeal and set aside the order of the judge below.

(1) (1951) 1 Ch. 680

(2) at page 686

Zimmern, J.A. :

6. I agree.

Hooper, J.:

7. I agree also.

Representation:

Mr. Leo Remedios (M/s D'Almada Remedios & Co.) for Appellant.

Mr. So Kwok Kuen, Respondent in person, absent

Mr. O'Connell for Official Receiver.