Tasma Finance Corporation – In the matter of v. Lucy Estates Co. Ltd. Misc. Cause 49-A-68; 15/9/70; Bramble, J.

Tasma Finance Corporation – In the matter of v. Lucy Estates Co. Ltd. Misc. Cause 49-A-68; 15/9/70; Bramble, J.

A winding up order was obtained against the respondent company. A Court Broker was appointed by the Official Receiver as Provisional Liquidator to take possession of the respondent company’s assets until a Manager was appointed and the property handed over to him. The Court Broker’s Bill of Costs assessed at Shs. 22,000/- was not submitted under Rule 180 of the Companies Winding up Rules 1929 and was not paid. The property of the company having been sold by the Creditors in exercise of a Power of Sale as mortgagees and with the consent of the liquidator, this application was brought by the Official Receiver under S. 191(5) of the Companies Ord. (Cap. 212) for an order that the Court Brokers bill be paid by the liquidator.

            Held: (1) S. 191(5) “gives redress with respect to an act or decision of the Liquidator. The act complained of is the failure to pay the broker’s charge. As he was employed by the official Receiver there was a responsibility in the Official Receiver to ensure payment of the fees and he will have a right to challenge the liquidators default. While it is clear that the Liquidator and the Official Receiver were aware of the taxed Bill of costs of the Broker there is no proof that a claim was made on the Liquidator either by the official Receiver or the Broker and the failure to pay cannot be said to be an act or decision which entitles the official Receiver to complain under Section 191(5) of the Relevant Ordinance. Even assuming that the summons was rightly taken out, it has not been questioned that the liquidator has no assets and if he has no assets he cannot pay. The sale of the Company’s properties was not made in the course of the winding-up when the sale price would have been paid to the Liquidator and such charges would have priority over even the interests of secured creditors. The Court cannot direct a person to do something which is impossible.” (2) “By exercising their power of sale the creditors removed from the liquidator the possibility of settling debts which had priority over secured debts though this was not a result that was foreseen. (3) Though it is just that the Creditors who moved the court should bear the Court Broker’s bill because this was loss through the consequent depreciation of the assets by the costs in the winding-up proceedings, they are not properly parties to the application since it relates to an act of the liquidator. (4) Application dismissed.