The Working Capitol (Robinson) Pte Ltd v Capitol Concepts Pte Ltd: Winding Up Application for Inability to Pay Debts
The Working Capitol (Robinson) Pte Ltd (in liquidation) applied to the High Court of Singapore on 7 September 2018 to wind up Capitol Concepts Pte Ltd, arguing the defendant was unable to pay its debts. Dedar Singh Gill JC granted the application, ordering the defendant to be wound up. The court found that the defendant failed to establish any substantial and bona fide dispute as to the debt owed to the plaintiff and failed to rebut the presumption of insolvency under section 254(2)(a) of the Companies Act. The defendant has since appealed.
1. Case Overview
1.1 Court
High Court of Singapore1.2 Outcome
Winding up order granted against the Defendant.
1.3 Case Type
Insolvency
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Plaintiff sought to wind up Defendant for inability to pay debts. The court granted the application, finding no substantial dispute over the debt.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| The Working Capitol (Robinson) Pte Ltd (in liquidation) | Plaintiff | Corporation | Winding up order granted | Won | |
| Capitol Concepts Pte Ltd | Defendant | Corporation | Winding up order made | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Dedar Singh Gill | Judicial Commissioner | Yes |
4. Counsels
4. Facts
- Plaintiff extended five loans to the Defendant between July 2017 and February 2018, totaling $599,200.
- Defendant repaid a total of $40,520.51 between October 2017 and December 2017.
- Plaintiff was compulsorily wound up on 2 March 2018.
- Liquidator of the Plaintiff served a statutory demand for $558,679.49 on the Defendant on 27 June 2018.
- Defendant failed to pay, secure, or compound the sum within three weeks.
- Plaintiff filed an application for the Defendant to be wound up on 20 July 2018.
- Defendant argued there was a substantial dispute over the debt due to an implied contractual set off agreement.
5. Formal Citations
- The Working Capitol (Robinson) Pte Ltd (in liquidation) v Capitol Concepts Pte Ltd, Companies Winding Up No 156 of 2018, [2018] SGHC 214
6. Timeline
| Date | Event |
|---|---|
| Plaintiff extended first loan to Defendant. | |
| Plaintiff extended fifth loan to Defendant. | |
| Plaintiff was compulsorily wound up. | |
| Liquidator served a statutory demand on the Defendant. | |
| Plaintiff filed application for Defendant to be wound up. | |
| Court granted Plaintiff’s application and ordered that the Defendant be wound up. | |
| Full grounds of decision set out. |
7. Legal Issues
- Inability to Pay Debts
- Outcome: The court found that the Defendant was unable to pay its debts and ordered it to be wound up.
- Category: Substantive
- Related Cases:
- [2007] 2 SLR(R) 268
- [2008] 2 SLR(R) 491
- Dispute over Debt
- Outcome: The court found that the Defendant failed to establish any substantial and bona fide dispute as to the debt owed to the Plaintiff.
- Category: Substantive
- Related Cases:
- [2007] 2 SLR(R) 268
- [2008] 2 SLR(R) 491
- Presumption of Insolvency
- Outcome: The court found that the Defendant failed to rebut the presumption of insolvency under s 254(2)(a) of the Companies Act.
- Category: Procedural
8. Remedies Sought
- Winding up order
- Appointment of liquidator
- Costs
9. Cause of Actions
- Winding Up
- Inability to Pay Debts
10. Practice Areas
- Insolvency
- Commercial Litigation
11. Industries
- No industries specified
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Metalform Asia Pte Ltd v Holland Leedon Pte Ltd | High Court | Yes | [2007] 2 SLR(R) 268 | Singapore | Cited for the principle that a creditor is ordinarily entitled to a winding up order where the presumption of insolvency applies and the debt is undisputed. |
| Pacific Recreation Pte Ltd v S Y Technology Inc and another appeal | Court of Appeal | Yes | [2008] 2 SLR(R) 491 | Singapore | Cited for the principle that a debtor-company must raise triable issues to demonstrate a substantial and bona fide dispute over the debt. |
| Lai Shit Har v Lau Yu Man | Court of Appeal | Yes | [2008] 4 SLR(R) 348 | Singapore | Cited for the principle that the court retains residual discretion to consider all relevant factors before deciding whether to wind up a company. |
| BNP Paribas v Jurong Shipyard Pte Ltd | Court of Appeal | Yes | [2009] 2 SLR(R) 949 | Singapore | Cited for the principle that the court may consider the interests of employees, non-petitioning creditors, suppliers, customers, and shareholders when deciding whether to wind up a company. |
| Cooperatieve Centrale Raiffeisen-Boerenleenbank BA (trading as Rabobank International), Singapore Branch v Motorola Electronics Pte Ltd | Court of Appeal | Yes | [2011] 2 SLR 63 | Singapore | Cited for the principle that a course of conduct or dealings between the parties and other relevant circumstances could form the basis for a contract to be implied, including a multi-party contract to set off. |
| Chip Thye Enterprises Pte Ltd (in liquidation) v Phay Gi Mo and others | High Court | Yes | [2004] 1 SLR(R) 434 | Singapore | Cited for the principle that the court may also look at the company’s accumulated losses to see if they are in excess of its capital; the nature of assets of the company; current liabilities over current assets; prospects of fresh capital or financial support from shareholders and incoming payments from any source to discharge the debts, including credit resources. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50, 2006 Rev Ed) | Singapore |
| Companies Act (Cap 50, 2006 Rev Ed) s 253(1)(b) | Singapore |
| Companies Act (Cap 50, 2006 Rev Ed) s 254(1)(e) | Singapore |
| Companies Act (Cap 50, 2006 Rev Ed) s 254(2)(a) | Singapore |
| Companies Act (Cap 50, 2006 Rev Ed) s 254(1)(i) | Singapore |
| Companies Act (Cap 50, 2006 Rev Ed) s 201(1) | Singapore |
| Companies Act (Cap 50, 2006 Rev Ed) s 254(2)(c) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Winding up
- Insolvency
- Statutory demand
- Implied contractual set off
- Tripartite agreement
- Presumption of insolvency
- Liquidator
15.2 Keywords
- Winding up
- Insolvency
- Companies Act
- Singapore
- Debt
- Liquidation
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Winding Up | 95 |
| Company Law | 60 |
| Bankruptcy | 30 |
| Corporate Insolvency | 30 |
| Contract Law | 20 |
16. Subjects
- Insolvency
- Corporate Law
- Debt Recovery