China Zhejiang v Zhejiang Construction: Winding Up Application for Undisputed Debt
The High Court of Singapore granted a winding-up order for Zhejiang Construction Investment (S) Pte Ltd (“Zhejiang SG”) on 5 July 2019, based on an undisputed debt of S$7,760,717.66 owed to China Zhejiang Construction Group (HK) Ltd (“Zhejiang HK”). The court, presided over by Chan Seng Onn J, appointed Mr. Tee Wey Lih as the liquidator. A non-party, Chiu Teng Construction Co. Pte Ltd, sought dismissal of the application, alleging a collateral purpose, but the court found no abuse of process and ordered the winding up to proceed.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Order for the defendant, Zhejiang Construction Investment (S) Pte Ltd, to be wound up.
1.3 Case Type
Insolvency
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Winding-up application granted against Zhejiang Construction Investment (S) Pte Ltd due to an undisputed debt owed to China Zhejiang Construction Group (HK) Ltd.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Chiu Teng Construction Co Pte Ltd | Other | Corporation | Application for dismissal denied | Lost | |
| China Zhejiang Construction Group (HK) Ltd | Plaintiff | Corporation | Winding-up order granted | Won | |
| Zhejiang Construction Investment (S) Pte Ltd | Defendant | Corporation | Winding-up order granted | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Chan Seng Onn | Judge | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Sharon Wong | Millennium Law LLC |
| Tan Tho Eng | TSMP Law Corporation |
4. Facts
- Zhejiang SG owed Zhejiang HK S$7,760,717.66 as of 28 March 2019.
- The debt arose from four loan agreements.
- Zhejiang HK served a statutory demand on Zhejiang SG on 2 April 2019.
- Zhejiang SG failed to satisfy the statutory demand.
- Zhejiang HK filed the winding-up application on 30 April 2019.
- The Non-Party alleged the winding-up application was for a collateral purpose.
- Zhejiang China owned 70% of Zhejiang SG and 100% of Zhejiang HK.
5. Formal Citations
- China Zhejiang Construction Group (HK) Ltd v Zhejiang Construction Investment (S) Pte Ltd, Companies Winding Up No 89 of 2019, [2019] SGHC 195
6. Timeline
| Date | Event |
|---|---|
| Joint venture agreement entered into by Non-Party, Zhejiang SG, and Etong Construction (S) Pte Ltd. | |
| The Project was completed. | |
| Non-Party served a letter of demand on Zhejiang SG for the sum of $978,717.94. | |
| Zhejiang SG responded to deny the Non-Party's claim. | |
| Negotiations between the Non-Party and Zhejiang SG occurred until January 2019. | |
| Zhejiang HK served a statutory demand on Zhejiang SG. | |
| Zhejiang HK filed the winding-up application. | |
| Court ordered Zhejiang SG to be wound up. | |
| Reasons for the order set out. |
7. Legal Issues
- Winding-up application
- Outcome: The court ordered Zhejiang SG to be wound up.
- Category: Substantive
- Related Cases:
- [2008] 4 SLR(R) 348
- [2009] 1 SLR(R) 844
- Abuse of process
- Outcome: The court found no abuse of process.
- Category: Procedural
- Related Cases:
- [2008] 4 SLR(R) 348
8. Remedies Sought
- Winding-up order
9. Cause of Actions
- Winding up application based on undisputed debt
10. Practice Areas
- Insolvency
- Commercial Litigation
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Lai Shit Har and another v Lau Yu Man | High Court | Yes | [2008] 4 SLR(R) 348 | Singapore | Cited for the principle that the court retains residual discretion to consider all relevant factors, including utility, propriety and effect of a winding-up order as well as the overall fairness and justice of the case. |
| Fustar Chemicals Ltd v Ong Soo Hwa (liquidator of Fustar Chemicals Pte Ltd) | High Court | Yes | [2009] 1 SLR(R) 844 | Singapore | Cited for the principle that the liquidator has a duty to examine and investigate every proof of debt and the grounds of the debt and may call further evidence in support of it. |
13. Applicable Rules
| Rule Name |
|---|
| Rule 92 of the Companies (Winding-Up) Rules (Cap 50, R 1, 2006 Rev Ed) |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50) | Singapore |
| Section 254(1)(e) of the Companies Act (Cap 50) | Singapore |
| s 254(2)(a) of the Companies Act (Cap 50, 2006 Rev Ed) | Singapore |
| s 300 of the Companies Act | Singapore |
| s 271 of the Companies Act | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Winding-up
- Statutory demand
- Collateral purpose
- Liquidator
- Related party transactions
- Abuse of process
15.2 Keywords
- Winding up
- Companies Act
- Insolvency
- Debt
- Singapore
- Construction
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Winding Up | 95 |
| Bankruptcy | 70 |
| Company Law | 60 |
| Liquidator Appointment | 40 |
| Contract Law | 30 |
| Commercial Disputes | 25 |
16. Subjects
- Insolvency
- Corporate Law
- Winding Up