Re The Incorporated Owners Of Tai Chi Factory Building (In Liquidation)

Court:High Court (Hong Kong)
Judgement Number:HCCW458/2016
Judgment Date:05 Mar 2020
Neutral Citation:[2020] HKCFI 371
HCCW458/2016 RE THE INCORPORATED OWNERS OF TAI CHI FACTORY BUILDING (IN LIQUIDATION)

HCCW 458/2016

[2020] HKCFI 371

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) PROCEEDINGS NO 458 OF 2016

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IN THE MATTER of the Building Management Ordinance (Cap 344)

and

IN THE MATTER of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32)

and

IN THE MATTER of the INCORPORATED OWNERS OF TAI CHI FACTORY BUILDING (in liquidation)

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Before: Deputy High Court Judge Le Pichon in Chambers
Date of Written Submissions: 22 January 2020
Date of Decision (Paper Disposal): 5 March 2020

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DECISION

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1. This is an ex parte application by the joint and several liquidators (“the Liquidators”) of the Incorporated Owners of Tai Chi Factory Building (in Liquidation) (“the Corporation”) seeking:

(1) the court’s sanction pursuant to section 218 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance, Cap 32 (“the Ordinance”) to distribute the only remaining asset (other than an amount of cash held) of the Corporation; and

(2) directions to allow the fees, costs and expenses of the Liquidators to be agreed and paid other than by way of taxation notwithstanding section 196(2)(b) of the Ordinance (“section 196”) and rule 176 (1) of the Companies (Winding-up) Rules, Cap 32H (“rule 176”).

Background

2. The Corporation was the incorporated owner of Tai Chi Factory Building (“the Building”). It was wound up on 8 March 2017 on its becoming functus officio. The Liquidators were appointed liquidators of the Corporation on 10 July 2017.

3. The Corporation owns the outer wall of the Building to which, pursuant to the Deed of Mutual Covenant, 1 of 155 undivided shares of the Building was allocated. It was acquired from the Hong Kong Government on 24 February 1982, the outer wall having devolved on the latter as bona vacantia.

4. The remaining 154 undivided shares in the Building are owned as to 132 undivided shares by Asia Turbo Development Limited and as to 22 undivided shares by Ray Bright Enterprises Ltd (collectively “the Owners”), both of which are subsidiaries of Henderson Land Development Company Limited. The Owners wish to acquire the outer wall from the Corporation for redevelopment purposes.

5. The Corporation is solvent. Apart from the 1 undivided share, it holds $292,090 in its liquidation account. It has no other assets and other than the disposal of its interest in the outer wall, there is nothing further to be done in its liquidation.

Distribution in specie

6. Part X of the Ordinance (which governs the winding up of “unregistered companies”) applies to the liquidation of the Corporation by virtue of section 33 of the Building Management Ordinance (“the BMO”), Cap 344. Accordingly, the provisions relating to compulsory liquidation apply: see sections 327 (1) and (2) of the Ordinance.

7. Section 33(2)(b) of the BMO provides that a reference to a member is deemed to be a reference to an owner.

8. It is proposed that the Corporation’s interest in the outer wall be distributed to the Owners as tenants in common...

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