Overview

In a recent judgment in Target Insurance Company Limited v Nerico Brothers Limited & Lee Cheuk Fung Jerff [2025] HKCA 1024 the Court of Appeal has clarified that a director can be made personally liable for the costs incurred by a company under their control and that unreasonably opposes its winding up.

Background

This week’s TGIF considers a recent decision of the High Court of Australia, in which a 4:3 majority held that a former trustee is not owed any fiduciary obligation by a successor trustee.

Key takeaways

In Davis-Jacenko v Roxy’s Bootcamp Pty Limited [2024] NSWSC 702, McGrath J delivered an extempore decision, appointing provisional liquidators in respect of Roxy’s Bootcamp Pty Limited (theCompany). His Honour stated that it was “a paradigm case” for the court to intervene to preserve the status quo.

Key Takeaways

In the recent decision in Blockchain Group Company Limited (in liquidation) v. PKF Hong Kong Limited¹, Le Pichon DHCJ decided that despite an error resulting in a protective writ naming the defendant as a limited company and formerly a firm, the relevant provisions to amend a party’s name could not be used to essentially replace the limited company with the firm.

The recent judgment in Re Proman International Limited¹ reaffirms the court's stance on the suitability of liquidators and the standards of disclosure required of them.

On 12 July 2023, the Legislative Council enacted the Bankruptcy and Companies Legislation (Miscellaneous Amendments) Ordinance 2023, a transformative initiative to modernise the filing and notice processes under the Bankruptcy Ordinance (Cap 6) and the Companies (Winding-Up and Miscellaneous Provisions) Ordinance (Cap 32). With the amendments, the Official Receiver’s Office (ORO) introduces the Electronic Submission System (ESS) to bring the ORO and insolvencies into the 21st century.

Changes effective from 29 December 2023

When do amounts owed to a company constitute ‘circulating assets’ and how should they be distributed? This crucial question has not always been answered predictably in recent cases. The Court of Appeal’s decision in Resilient Investment Group Pty Ltd v Barnet and Hodgkinson as liquidators of Spitfire Corporation Limited (in liq) [2023] NSWCA 118 has provided a framework for navigating the relevant principles in the context of a priority dispute over R&D tax refunds.

Key takeaways

In the landmark judgment by Linda Chan J in Re Gatecoin Ltd (in liquidation) [2023] HKCFI 914, the Court of First Instance held that cryptocurrencies were property under Hong Kong law capable of being held for distribution to creditors (or beneficiaries if they were trust assets) for the purposes of administrating an insolvent estate. In this article, the authors consider the Court’s ruling and its wider implications for the insolvency regime in Hong Kong, focusing on fraud claims and reviewable transactions in the cryptocurrency context.

In the recent case of Re Guangdong Overseas Construction Corporation [2023] HKCFI 1340 (17 May 2023), the Hon Linda Chan J confirmed the Hon Harris J’s decision in Re Global Brands Group Holding Ltd (in liquidation) [2022] 3 HKLRD 316 in introducing centre of main interest principles in assessing whether or not the Hong Kong court should recognise a foreign liquidation and assist a foreign office-holder.

Directors who oppose the winding-up of an insolvent company in the hope that a restructuring proposal would come to fruition should tread carefully and consider seriously whether to put the company into liquidation.