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Re Cyberworks Audio Video Technology Ltd ("The Company

Judgment Cited authorities 2 Cited in 16 Precedent Map Related
Vincent
Judgment Date04 May 2010
Year2010
Citation[2010] 2 HKLRD 1137
Judgement NumberHCCW1113/2002
Subject MatterCompanies Winding-up Proceedings
CourtHigh Court (Hong Kong)
HCCW001113/2002 RE CYBERWORKS AUDIO VIDEO TECHNOLOGY LTD ("the Company")

HCCW 1113/2002

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 1113 OF 2002

____________

IN THE MATTER of CYBERWORKS AUDIO VIDEO TECHNOLOGY LIMITED (“the Company”)
and
IN THE MATTER of the Companies Ordinance, Chapter 32 of the Laws of Hong Kong

____________

Before: Hon Harris J in Chambers

Date of Hearing: 16 April 2010

Date of Decision: 4 May 2010

__________________

DECISION

__________________

1. I have before me an application by the Joint and Several Liquidators of the Company for leave to enter into an option and investigation agreement with Remedy Asia Limited (“Remedy”). In short this agreement provides that Remedy will conduct investigations into various claims, the details of which it is appropriate are omitted from this judgment for reasons of confidentiality, that the Liquidators consider the Company has against various parties in some cases against whom litigation has already been commenced, and depending on the outcome of those investigations fund legal proceedings in return for an option to take an assignment of those proceedings and the cause of action on which they are founded. The agreement is necessary because the Company does not have the funds to finance legal proceedings itself.

2. The application was originally made, as is increasingly common, in writing. I asked to be addressed on the legal principles relevant to an assignment of a cause of action as I was not aware of any authority in Hong Kong addressing this issue although I understand that the Company’s court has on previous occasions approved an assignment of a cause of action as part of a third party funding agreement.

3. On 26 March 2010 the Liquidators issued a summons for an order under section 199(3) of the Companies Ordinance, which is supported by affidavit of one of the Liquidators, Mr Stephen Briscoe. Mr Simon Westbrook SC appeared for the Liquidators at the hearing of the summons.

4. I am satisfied that there is no objection in principle to the court approving a funding agreement which includes an assignment of a cause of action and that it is an appropriate arrangement for the Liquidators to make in this case. I shall, therefore, make an order in the terms of the summons. I think that it would be helpful if I set out briefly my reasons for concluding that the court may approve an assignment of a cause of action to a funder in order that there is an authority addressing the issue in Hong Kong.

5. Section 199(2)(a) of the Companies Ordinance gives a Liquidator power to sell the property of the Company. Section 199(2)(a) provides as follows:

“(a) to sell the real and personal property and things in action of the company by public auction or private contract, with power to transfer the whole thereof to any person or company, or to sell the same in parcels;”

Section 19 of Cap. 1 defines “property” to include:

“(a) money, goods, choses in action and land; and

(b) obligations, easements and every description of estate, interest and profit, present or future, vested or contingent, arising out of or incident to property as defined in paragraph (a) of this definition;”

6. A cause of action is a chose in action and, therefore, section 199(2)(a) enables a liquidator to sell a cause of action vested in a...

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14 cases
  • Re A
    • Hong Kong
    • Court of First Instance (Hong Kong)
    • 19 March 2020
    ...Rains Prudential Ltd & ors [1999] 2 AC 1, Re Oasis Merchandising Services Ltd [1997] BCC 282, Re Cyberworks Audio Video Technology Ltd [2010] 2 HKLRD 1137, Re Company A to Company G HCCW384, 409, 637&638/2005, 2421/2007, 120/2008 and 2019/2015 (heard together), Harris J (unreported, 8 Octob......
  • Re Chu Chi Ho Ian (Also Known As Chu Chi Ho)
    • Hong Kong
    • High Court (Hong Kong)
    • 18 November 2014
    ...of the Court and this should be done inter partes with all the creditors of the Bankrupt : Re Cyberworks Audio Video Technology Ltd [2010] 2 HKLRD 1137 and Berman v SPF CDO I Ltd [2011] 2 HKLRD (c) Thirdly, even if the Trustees are entering into a funding arrangement with a creditor, the te......
  • Geoffrey L. Berman (In His Capacity As Trustee Of The Lender Trust) v Spf Cdo I, Ltd And Others
    • Hong Kong
    • High Court (Hong Kong)
    • 14 March 2011
    ...to a claim brought by an assignee under a funding agreement on the grounds of champerty. In Re Cyberworks Audio Video Technology Ltd. [2010] 2 HKLRD 1137 I decided that an assignment of a chose in action by a liquidator to a third party litigation funder was not inconsistent with the common......
  • Raafat Imam v Life (China) Co Ltd And Others
    • Hong Kong
    • Court of First Instance (Hong Kong)
    • 9 August 2018
    ...cases and submitted that approval of funding agreements by the court is commonplace. 92. In Re Cyberworks Audio Video Technology Ltd [2010] 2 HKLRD 1137, Harris J, after referring to section 199(2)(a) of thethen Companies Ordinance, approved an application by the liquidators of a company fo......
    • Request a trial to view additional results
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