The case of Wing Hong Construction Limited v Hui Chi Yung and Ors [2017] HKEC 1173 provides an overview of the legal principles which apply to an application for security for costs, where the Plaintiff against whom security is sought is a company and the application is made under section 905 of the Companies Ordinance (Cap 622). This was an appeal against the decision of a Master who had dismissed the Defendant’s application for security for costs against the Plaintiff which was a private company in liquidation. The appeal was allowed and security for costs of HK$2 million ordered.
The current litigation landscape for professionals in Hong Kong is relatively benign: but is this the lull before the storm? Accurate records are kept of all actions commenced in the Hong Kong High Court, which deals with claims of over HK$1 million. The graph above shows the number of claims begun by writ each year over the last 15 years. This data covers all claims, not just those against professionals, but gives an indication of the general litigation trends.
Can we learn sufficient lessons from Carillion to avoid construction related insolvency closer to home?
1. PUTTING INSOLVENCY ON THE AGENDA
NEW GOVERNMENT LEGISLATION PROGRAMME: INDUSTRY & SECTOR SPECIFIC BREAKDOWN 19 JANUARY 2015 The Irish Government has published its legislation programme for the Spring/Summer 2015 parliamentary session. There are 32 Bills which are currently before the Oireachtas. In addition, there are 137 proposed Bills set out in the Programme, 41 of which the Government intends publishing during the Spring/Summer Session.
The High Court has recently held that a former employee of a construction company, which was in liquidation, had no reasonable cause of action against the company’s insurer. This was despite the fact that he had obtained judgment for negligence against the employer and the insurance policy covered the employer for such a claim in negligence.
In this recession like no other, enforcement over complete and incomplete residential and other property developments is a common scenario faced by both bank and Insolvency Practitioner alike. The dilemma initially appears quite stark; Should the bank advance further monies to complete out developments in order to maximise realisations or sell the site "as is" to another developer but at a significantly discounted price? The purpose of this article is to consider the issues which warrant consideration before devising an enforcement strategy in relation to incomplete developments.
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The retention of a proportion of the contractor's fee is common practice in construction contracts. The parties sometimes agree (usually in unamended industry standard building contracts) that the retention amount is held on trust by the employer in a separate bank account. But what happens if there is no such express provision and the employer becomes insolvent?