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…it is fallacious and unrealistic for the Company to assume that the value of the Haitian Shares remained the same from February to August 2019. Between February and August 2019, Haitian Energy had published no less than nine announcements suggest that the financial condition of Haitian Energy was in a state of flux, and that the value of the Haitian Shares was susceptible to fluctuation.

– William Wong SC (Deputy High Court Judge in Re Victor River Ltd)

INTRODUCTION

In bankruptcy as in federal jurisprudence generally, to characterize something with the near-epithet of “federal common law” virtually dooms it to rejection.

引言

Re China Huiyuan Group Ltd [2020] HKCFI 2940一案中,原訟法庭拒絕對一家在香港上市的開曼公司進行清盤,因為原訟法庭認為,呈請人未能證明在作出清盤令後,債權人確實有可能獲得實際利益。

案情

SDFIII Holdings Limited(以下簡稱「呈請人」)以資不抵債為由,發出對China Huiyuan Juice Group Limited(以下簡稱「該公司」)進行清盤的呈請。各方對該債務沒有爭議。

該公司在開曼群島註冊成立,並在香港聯交所主板上市。該公司的資產包括在英屬處女群島註冊成立的附屬公司的所有權,該等附屬公司在中國內地擁有附屬公司,而該等附屬公司又擁有該公司的相關資產,並開展生產及其他業務。

對該公司無爭議的是,該公司已資不抵債。該公司要求押後該呈請,以推進該公司的債務重組。由於股份已暫停買賣,而該公司亦面臨潛在的退市問題,該公司認為重組是令集團業務重回正軌的唯一方法,長遠而言,對該公司的債權人是有利的。

因此,法院將裁定是否立即發出清盤令或批准延期。

爭議點

爭議點如下:-

In January 2020 we reported that, after the reconsideration suggested by two Supreme Court justices and revisions to account for the Supreme Court’s Merit Management decision,[1] the Court of Appeals for the Second Circuit stood by its origina

Introduction

In Re China Huiyuan Group Ltd [2020] HKCFI 2940, the Court of First Instance declined to wind up a Hong Kong-listed Cayman company as the Court held that the petitioner failed to demonstrate that there was a real possibility of a tangible benefit to creditors upon the making of a winding up order.

Facts

SDF III Holdings Limited (the “Petitioner”) issued a petition to wind-up China Huiyuan Juice Group Limited (the “Company”) on the grounds of insolvency. The debt is not disputed.

It seems to be a common misunderstanding, even among lawyers who are not bankruptcy lawyers, that litigation in federal bankruptcy court consists largely or even exclusively of disputes about the avoidance of transactions as preferential or fraudulent, the allowance of claims and the confirmation of plans of reorganization. However, with a jurisdictional reach that encompasses “all civil proceedings . . .

I don’t know if Congress foresaw, when it enacted new Subchapter V of Chapter 11 of the Code[1] in the Small Business Reorganization Act of 2019 (“SBRA”), that debtors in pending cases would seek to convert or redesignate their cases as Subchapter V cases when SBRA became effective on February 19, 2020, but it was foreseeable.

Our February 26 post [1] reported on the first case dealing with the question whether a debtor in a pending Chapter 11 case may redesignate it as a case under Subchapter V, [2] the new subchapter of Chapter 11 adopted by the Small Business Reorganization Act of 2019 (“SBRA”), which became effective on February 19.

Our February 26 post entitled “SBRA Springs to Life”[1] reported on the first case known to me that dealt with the issue whether a debtor in a pending Chapter 11 case should be permitted to amend its petition to designate it as a case under Subchapter V,[2] the new subchapter of Chapter 11 adopted by

State governments can be creditors of individuals, businesses and institutions that are debtors in bankruptcy in a variety of ways, most notably as tax and fine collectors but also as lenders. They can also be debtors of debtors, in their role, for example, as the purchasers of vast quantities of goods and services on credit. And they can also be transferees of a debtor’s property in (at least) every role in which they can be creditors.