liquidator

Case Update: Who Has to Pay the Liquidator’s Remuneration When Winding Up Reversed?

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The Singapore Court of Appeal in AnAn Group (Singapore) Pte Ltd v VTB Bank (Public Joint Stock Company) [2021] SGCA 112 dealt with an important and novel area of winding up law. If a winding up order is subsequently reversed or set aside, who should pay for all the winding up expenses, including the liquidator’s fees?

While this is a Singapore decision, it would be persuasive in Malaysia as our laws are similar. The aim of this update is to focus on this key issue and set out the takeaway points to apply in a Malaysian context.

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Case Update: Creditors’ Decision in Liquidation Governed by Majority in Value?

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The High Court in Coca Cola Refreshments Malaysia Sdn Bhd v Leejin Capital Sdn Bhd [2021] MLJU 1700 (grounds of judgment date 6 August 2021) invalidated the appointment of the liquidator in a creditors’ voluntary winding up. The Court ordered that instead, another liquidator candidate be appointed, where that candidate was nominated by a creditor holding a majority in value of the debt of the company.

This decision may cause uncertainty for future creditors’ voluntary winding up as well as other forms of winding up.

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Case Update: Priority of An Admiralty Claim Versus Insolvency

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Wong Chee Chien writes a case update on when an admiralty claim trumps insolvency.

More often than not, a creditor with an admiralty claim would take steps to arrest a ship or vessel of the debtor, for the purposes of selling it so that the proceeds of sale will be held as pre-judgment security for the creditor.

However, if the debtor subsequently goes into liquidation, what happens to the proceeds of sale from the arrested vessel? Should the proceeds be paid to the creditor, or should they be distributed to all unsecured creditors pari passu? These issues were dealt with by the High Court in Dan Bunkering (Singapore) Pte Ltd v The Owners of the Ship or Vessel “PDZ Mewah” & Anor (see grounds of judgment dated 9 August 2021).

Although this decision deals with several issues, this case update focuses on the question of whether the creditor’s admiralty claim trumps the insolvency regime of pari passu distribution among unsecured creditors. Continue reading →

Case Update: Mandatory for Bursa Malaysia to De-List a Wound Up Company

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[Edit: The Federal Court, in its grounds of judgment dated 31 March 2022, has overturned this Court of Appeal decision. Bursa Malaysia does have discretion on the de-listing of a wound-up company.]

The Court of Appeal in Bursa Malaysia Securities Berhad v Mohd Afrizan bin Husain (grounds of judgment dated 2 July 2021) ruled that once a winding up order was made against a public listed company, Bursa Malaysia must de-list that company from the stock exchange.

The case dealt with interesting issues between the interplay of a liquidator’s role under the Companies Act and where the liquidated company is also subject to Bursa Malaysia’s Listing Requirement.

The Federal Court has granted leave to appeal against this Court of Appeal decision.

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Case Update: Court Will be Slow to Second Guess Liquidator’s Decision on Proof of Debt

Lee ShihLeave a comment

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: Local Authority’s Assessment Rates is Not a Priority Debt in Liquidation

Lee ShihLeave a comment

In the High Court decision of Re SG & Sons Sdn Bhd (grounds of judgment dated 10 February 2021), the Court has confirmed that the local authority’s assessment rates is not a priority debt in a winding up.
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