Re Carlton Hotel Limited

HCCW000170/1986

COMPANIES WINDING-UP NO. 170 OF 1986

(Formerly No. M.P. 503 of 1986)

IN THE SUPREME COURT OF HONG KONG

HIGH COURT

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Coram: Hon. Jones J. in Court

Date of hearing: 24th September, 1986

Date of delivery of decision: 24th September, 1986

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DECISION

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1. On the 27th February 1986, a petition was presented on behalf of Alexander Tse Ming Cheung (the petitioner) by Wilkinson & Grist against the Carlton Hotel Limited (the company) which was incorporated in Hong Kong in January 1958 for inter alia, various declarations, injunctions and for an order that the petitioner's shares in the company be bought at a fair value by the other members of the company or the company.

2. The company is essentially a family concern which was founded by the petitioner's father Cheung Koon Shing (the respondent) who holds 20% of the shares. He is the managing director and runs the business. The petitioner is also a director and holds 14% of the shares whilst the remainder are held by other members of the family.

3. The petitioner is a medical practitioner who carries on his practice in New York. He has nothing to do with the every day conduct of the business. Although the company is said in the petition to be solvent, the petitioner alleges that the affairs of the company have been conducted in a manner oppressive to part of the members of the company including himself.

4. Since the presentation of the petition, a number of voluminous affidavits and other documents have been filed by the petitioner and also on behalf of the company.

5. On the 14th May, an order was made by Mr Justice MacDougall to amend the petition by including a prayer for the company to be wound-up compulsorily on the just and equitable ground. The amended petition was presented on the 17th May.

6. Following the presentation of the amended petition further affidavits were filed whilst a number of interlocutory applications have been heard in Chambers. The petition came before the Court for call over on the 7th July when directions were given for the trial which was estimated to last for six days and was adjourned to a date to be fixed. Dates for the trial were fixed by the officer in charge of the lists on the 18th July for the hearing to commence today.

7. On the 1st September, the petitioner wrote to Wilkinson &Grist withdrawing their instructions. An order was made on the 11th September on the application of Wilkinson & Grist declaring that they had ceased to act for the petitioner in this action.

8. The petition came on for hearing before me this morning when the petitioner who had travelled to Hong Kong from New York on Sunday appeared in person and made an application for an indefinite adjournment of the proceedings until he is in a position to instruct another firm of solicitors to act for him. The application for the adjournment has been resisted by Mr Maxwell-Lewis who appeared on behalf of the respondent.

9. In the Companies Court, it is the duty of a petitioner to proceed with due diligence whilst long adjournments are granted only in exceptional circumstances. The considerations that apply to a petition based on the just and equitable ground are somewhat different, but such cases must not in any event be held over indefinitely. Here, we have a wellknown hotel in Hong Kong which is still trading, with a winding-up petition before the Court which can only affect its financial standing apart from the general embarrassment caused by the unfavourable publicity that has arisen following the allegations that have emerged in these proceedings. Such issues should be tried by the Court at the earliest possible date and should net be allowed to hang over a company indefinitely. There has been no delay by the petitioner in prosecuting the petition, but at the eleventh hour, he has made his decision to withdraw instructions from his solicitors. The action after many months of preparation is ready for trial, but the petitioner is not now ready to proceed. He alone is responsible for the position in which he now finds himself.

10. In my judgment, it would be quite unreasonable to allow this petition to be stood over indefinitely to enable the petitioner to instruct another firm of solicitors. He has in fact, had ample time to instruct another firm in place of Wilkinson & Grist since he wrote to them on the 1st September. Accordingly, I am quite satisfied in all the circumstances that the application for an adjournment should be refused. As the petitioner is unable to proceed, the petition will be dismissed with costs.

Representation:

Dr Tse Ming Cheung M.D., Petitioner in person

Mr. C. Maxwell-Lewis (Fairbairn & Kwok) for Cheung Koon Shing (respondent)

Mr. M. D. M. Woollard for Official Receiver