Re Bintan Lagoon Resort Ltd: Judicial Management Order Application

The petitioners applied for a judicial management order for Bintan Lagoon Resort Ltd, despite the appointment of a receiver and manager by a secured creditor, Winners Path Pte Ltd. The High Court of Singapore, presided over by Andrew Ang J, dismissed the petition on 19 August 2005, holding that the public interest did not require the court's intervention under section 227B(10) of the Companies Act, even though the petitioners argued that Winners Path had acquired its security in bad faith and that the company's demise would have economic, social, and political consequences.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Petition dismissed with costs.

1.3 Case Type

Insolvency

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Application for judicial management order for Bintan Lagoon Resort Ltd was dismissed. The court held that public interest did not require intervention.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Bintan Lagoon Resort LtdRespondentCorporationPetition dismissedLost
Winners Path Pte LtdRespondentCorporation
Post Office Savings Bank of SingaporePetitionerCorporationPetition dismissedLost
Unsecured creditorsPetitionerOtherPetition dismissedLost
Secured creditorRespondentOther
Receiver and managerRespondentOther

3. Judges

Judge NameTitleDelivered Judgment
Andrew AngJudgeYes

4. Counsels

Counsel NameOrganization
Rebecca ChewRajah and Tann
Audrey NgRajah and Tann
Meah Tze HuaRajah and Tann
Jenny TsinWong Partnership
Nishith ShettyWong Partnership
Ashok KumarAllen and Gledhill
Foo Hsiang MingAllen and Gledhill
Cavinder BullDrew and Napier LLC
Benjamin GawDrew and Napier LLC
Sham SabnaniDrew and Napier LLC

4. Facts

  1. The petitioners applied for a judicial management order for the Company.
  2. A receiver and manager had already been appointed by a secured creditor, Winners Path Pte Ltd.
  3. Winners Path acquired the rights and interests under the deed of debenture by buying out the Club Lenders.
  4. The petitioners alleged that the buyout was done in bad faith.
  5. The Company's shareholders are SAFE Enterprises Pte Ltd, The Kintetsu Group, PT Buana Megawisatama, Seletar Investments Pte Ltd, and Straits Steamship Co Ltd.
  6. The Company is indebted to POSB in the sum of $20m under an unsecured medium term loan facility.
  7. The remaining petitioners are owed a sum of $43,200,000 as bondholders under a bond issue.

5. Formal Citations

  1. Re Bintan Lagoon Resort Ltd, OP 3/2005, [2005] SGHC 151

6. Timeline

DateEvent
Bintan Lagoon Resort Ltd incorporated in Singapore
Deed of debenture executed by the Company secured by a fixed and floating charge
Bond issue
Unsecured medium term loan facility matured and became repayable
Bond matured
Company made its first restructuring proposal to the petitioners
Company and its shareholders came under pressure from the Club Lenders
Club Lenders’ solicitors threatened legal action against the Company
Winners Path bought out the Club Lenders
Petition dismissed

7. Legal Issues

  1. Whether a judicial management order should be granted where a receiver and manager has already been appointed by a secured creditor
    • Outcome: The court held that the public interest did not require the making of a judicial management order.
    • Category: Substantive
  2. Whether a judicial management order should be granted on public interest grounds
    • Outcome: The court held that the public interest did not require the making of a judicial management order.
    • Category: Substantive

8. Remedies Sought

  1. Judicial Management Order

9. Cause of Actions

  • Application for Judicial Management Order

10. Practice Areas

  • Commercial Litigation
  • Insolvency
  • Restructuring

11. Industries

  • Hospitality
  • Tourism

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Re Cosmotron Electronics (Singapore) Pte LtdHigh CourtYes[1989] SLR 251SingaporeCited for the principle that the court has an overriding power to make a judicial management order if it considers the public interest so requires, notwithstanding that it may not be satisfied that the making of the order would be likely to achieve one or more of the purposes set out in s 227B(1).

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
Companies Act (Cap 50, 1994 Rev Ed)Singapore
Companies Act (Cap 50, 1994 Rev Ed)Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Judicial management order
  • Receiver and manager
  • Secured creditor
  • Public interest
  • Deed of debenture
  • Unsecured creditors
  • Restructuring proposal

15.2 Keywords

  • Judicial management
  • Receiver
  • Manager
  • Public interest
  • Bintan Lagoon Resort

17. Areas of Law

Area NameRelevance Score
Judicial Management90
Company Law70
Winding Up60
Bankruptcy30
Banking and Finance20

16. Subjects

  • Insolvency
  • Judicial Management
  • Company Law