IN THE SUPREME COURT OF HONG YONG
and Millie’s Trading Company Limited Millie’s Wholesale Centre Limited Miliie’s Property Management Company Limited Millie’s Handbag & Shoes Factory Limited Sum Chun High Quality Shoes Factory Limited ______________
Millie’s Trading Company Limited
Millie’s Wholesale Centre Limited
Miliie’s Property Management Company Limited
Millie’s Handbag & Shoes Factory Limited
Sum Chun High Quality Shoes Factory Limited
Coram : Hon. Jones J. In Chambers
Date of hearing : 18th December 1985
Date of Ruling : 18th December 1985
1. On the 21st November 1985 I made a ruling on a matter that arose at the previous hearing of the present summonses issued by the applicantsthe Provisional Liquidators of Millie’s Shoes Factory Limited and five other companies in the Millie’s group. The facts are set outin that ruling and I do not propose to repeat them. At the outset today, Mr. Allen on behalf of the official Receiver unreservedlywithdrew the allegations that had been made at that hearing against the applicants and tendered his apologies which were acceptedby Mr. Dicks who appeared on their behalf. Mr. Woollard then proceeded to conduct the case today on behalf of the Official Receiver.
2. Since the last hearing, a letter has been written to the applicant’s solicitors by the Official Receiver which is dated the 9th December1985 in which he sets out the broad basis on which he seeks to argue the issues relating to the applications which are as follows:-
3. Additional evidence has also been placed before the Court by way of affidavits from the applicants Mr. Timso and Mr. Stevenson andby Mr. Woollard for the Official Receiver. These affidavits in the main are concerned with the work and conduct of the liquidations.Certain paragraphs of Mr. woollard’s affidavit are in fact inadmissible, but it is unnecessary for me to comment further for thepurposes of the present ruling.
4. Great reliance has been placed by Mr. Wollard on Re Carton Limited (1923) 128 L.T. 629 as support for the Official Receiver’s contention that the applicants’ fees should be charged on a percentage basis or by referenceto a scale. In that case Lawrence J. at p. 631 had this to say :-
The second reason that was given is not relevant.
5. It is quite apparent from a reading of this case that it is not an authority to support the contention that the liquidator’s remunerationis to be fixed by reference to a scale or by way of a percentage. Indeed I understand from Mr. Woollard that he does not now assertthat there is any such rule or scale. In my opinion it would be wrong for me to accede to any invitation to set out guidelines tothe Taxing Master as to the basis upon which he should determine the proper remuneration of the applicants. This case must dependon its own facts.
6. Having regard to the criticisms that have been levelled at the applicants by the official Receiver, the Taxing Master will have todecide whether adequate remuneration can be provided by reference to a scale or a percentage or whether the time basis is appropriate.Whichever basis is to be applied can only be determined after a full investigation into the facts by the Taxing Master.
7. Adequate remuneration means sufficient remuneration to compensate the applicants for the work that they have done, provided thatit was properly incurred. If the Taxing Master is unable to decide what is adequate by reference to a scale or percentage, he maytake all relevant circumstances including the time factor into consideration. The Taxing Master should exercise his discretion onthe taxation on the usual wellknown principles.
8. Accordingly the fees of the applicants are referred to the Taxing Master for taxation. In fact I made such a reference on the 12thJanuary 1985. However, the Official Receiver and the applicants’ solicitors requested: that I hear the summonses with regard to thebasis upon which the remuneration should be taxed. I have today expressed my views that this was not the correct procedure to adoptfor it would amount to giving an answer to a hypothetical question. The fees and any argument thereon should have been directed asI have said to the Taxing Master at the outset. Both parties were at fault in this respect with the result that I shall make no orderas to costs.
9. The summonses should not have been issued by way of separate miscellaneous proceedings, but should have been instituted in the companieswinding-up proceedings. I shall therefore make a formal order that all the papers in the miscellaneous proceedings be transferredto the companies winding-up actions.
Mr. A.R. Dicks (Coward Chance) for former provisional liquidators.
Mr. Woollard for Official Receiver