The Edge Malaysia reported in its 29 March 2021 issue that fewer companies were wound up in 2020 compared with 2019. The article shared two interesting statistics they obtained from the Companies Commission of Malaysia. Continue reading
insolvency
Case Update: Court Will be Slow to Second Guess Liquidator’s Decision on Proof of Debt
The Court of Appeal in its grounds of judgment dated 18 March 2021 in Sunrise Megaway Sdn Bhd (in liquidation) v Kathryn Ma Wai Fong set out the principles when there is a challenge on a liquidator’s decision to admit or reject a proof of debt. Exceptional circumstances are required to second guess the liquidator’s decision.
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Case Update: Singapore Court Addresses Residuary Powers of Directors in Judicial Management
Wong Li Qi writes a case update on a Singapore High Court decision on the interaction between the judicial manager’s powers and the directors’ residuary powers of management.
The Singapore High Court in Ocean Tankers (Pte) Ltd v Rajah & Tann Singapore LLP [2021] SGHC 47 dealt with the standing of directors to bring an action on behalf of the companies after interim judicial managers were appointed.
AirAsia X Restructuring: Scheme is an Insolvency-Related Event under Cape Town Convention
Kwan Will Sen and Joyce Lim write about the recent judgment involving AirAsia X’s restructuring and its significance under the Cape Town Convention.
Quick Take
The Malaysian High Court in Kuala Lumpur had on 19 February 2021 handed down a significant judgment (click here for the grounds of judgment) in relation to AirAsia X Berhad (“AAX”)’s application for leave to convene creditors’ meeting for purposes of considering and approving a scheme of arrangement (“Leave Application”).
It analysed and interpreted certain provisions under the Convention on the International Interests in Mobile Equipment (“the Convention”) and the Protocol to the Convention on International Interests in Mobile Equipment on Matters Specific to Aircraft Equipment (“the Protocol”), in particular that of Article XI(10) of the Protocol. Continue reading
Financial Distress: 6 Reliefs for Corporate Malaysia
In EY Malaysia’s Transactions Insights (February 2021), it was pointed out that the prolonged impact of the COVID-19 pandemic continues to disrupt Corporate Malaysia, financially and operationally. Almost a year on, the magnitude of financial risks has increased. A vast majority of companies would require some form of recapitalization to improve their financial position.
I identify six much-needed reliefs to provide a shot in the arm for Corporate Malaysia. The reliefs will help to inoculate and strengthen businesses against further distress.
In the Companies Commission of Malaysia (CCM) Consultation Document issued in July 2020, CCM set out policies and a draft proposed Bill in support of such reliefs. I wrote about these changes in The Edge Malaysia as well.
Like the vaccine rollout in Malaysia, I am hoping for a smooth and quick rollout of these proposed laws. The commentary below is based on the proposed laws by the CCM. Continue reading
Case Update: Director’s Breach of Fiduciary Duty Through Inaction
The Privy Council’s decision in Byers v Chen Ningning [2021] UKPC 4 reiterates certain key points of law on the director’s fiduciary duty to the company. A director who knows that a fellow director is acting in breach of duty or that an employee is misapplying the assets of the company must take reasonable steps to prevent that from happening.