Zetta Jet Pte Ltd & Anor v Asia Aviation Holdings: Cross-Border Insolvency & Recognition of US Bankruptcy Proceedings
The High Court of Singapore heard an application by Jonathan D. King, the US Bankruptcy Trustee of Zetta Jet Pte. Ltd. and Zetta Jet USA, Inc., for full recognition of US bankruptcy proceedings under the UNCITRAL Model Law on Cross-Border Insolvency. Asia Aviation Holdings Pte Ltd intervened. The court granted full recognition, determining that Zetta Jet Singapore's center of main interests (COMI) was in the US and that no public policy issues prevented recognition.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
US bankruptcy proceedings in relation to Zetta Jet Singapore are to be recognised as a foreign main proceeding.
1.3 Case Type
Insolvency
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court grants full recognition to US bankruptcy proceedings of Zetta Jet entities, determining the center of main interests (COMI) was in the US.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Zetta Jet Pte. Ltd. | Applicant | Corporation | Application Granted | Won | |
| Zetta Jet USA, Inc | Applicant | Corporation | Application Granted | Won | |
| Jonathan D. King | Applicant | Individual | Application Granted | Won | |
| Asia Aviation Holdings Pte Ltd | Intervener | Corporation | Intervention Dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Aedit Abdullah | Judge | Yes |
4. Counsels
4. Facts
- Zetta Jet Pte Ltd is a Singapore-incorporated company that wholly owns Zetta Jet USA, Inc.
- The principal business of the Zetta Entities is in aircraft rental and charter.
- Voluntary Chapter 11 bankruptcy proceedings were filed against the Zetta Entities in the US Bankruptcy Court.
- AAH and TGGL commenced an action in Singapore against Zetta Jet Singapore for commencing the Chapter 11 proceedings in alleged breach of the SHA.
- AAH and TGGL obtained an injunction to prevent Zetta Jet Singapore from taking further steps in relation to the bankruptcy filings in the US Bankruptcy Court.
- The US bankruptcy proceedings were subsequently converted to Chapter 7 proceedings.
- The injunction was discharged by consent of the parties involved.
5. Formal Citations
- Re: Zetta Jet Pte Ltd and others (Asia Aviation Holdings Pte Ltd, intervener), Originating Summons No 1391 of 2017, [2019] SGHC 53
6. Timeline
| Date | Event |
|---|---|
| Shareholders’ Agreement signed | |
| Voluntary Chapter 11 bankruptcy proceedings were filed against the Zetta Entities in the US Bankruptcy Court | |
| AAH and TGGL obtained an injunction to prevent Zetta Jet Singapore, Seagrim and Walter from taking further steps in relation to the bankruptcy filings in the US Bankruptcy Court | |
| King was appointed the Chapter 11 Trustee of the Zetta Entities in the US bankruptcy proceedings | |
| TGGL discontinued its action | |
| The US Bankruptcy Court authorised the Trustee to commence recognition proceedings in Singapore | |
| The Trustee commenced recognition proceedings in Singapore | |
| Zetta Jet Singapore filed an application to set aside the Singapore injunction | |
| The injunction was discharged by consent of the parties involved | |
| Judgment reserved | |
| Judgment date |
7. Legal Issues
- Recognition of Foreign Bankruptcy Proceedings
- Outcome: The court granted full recognition to the US bankruptcy proceedings.
- Category: Substantive
- Determination of Center of Main Interests (COMI)
- Outcome: The court determined that Zetta Jet Singapore's COMI was in the US.
- Category: Substantive
- Public Policy Exception to Recognition
- Outcome: The court held that no public policy issues prevented recognition of the US bankruptcy proceedings.
- Category: Substantive
8. Remedies Sought
- Recognition of US Bankruptcy Proceedings
- Orders under the Singapore Model Law
9. Cause of Actions
- Breach of Shareholders’ Agreement
- Recognition of Foreign Proceeding
10. Practice Areas
- Cross-Border Insolvency
- Bankruptcy Law
11. Industries
- Aviation
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Re Zetta Jet Pte Ltd and others | High Court | Yes | [2018] 4 SLR 801 | Singapore | Prior decision in the same matter where limited recognition was granted. |
| Pertamina Energy Trading Ltd v Karaha Bodas Co LLC and others | N/A | Yes | [2007] 2 SLR(R) 518 | Singapore | Cited regarding the principle that breach of a court order is still contempt even if the order is later discharged. |
| Nikkomann Co Pte Ltd and others v Yulean Trading Pte Ltd | N/A | Yes | [1992] 2 SLR(R) 328 | Singapore | Cited as a contrary authority to Pertamina regarding the effect of discharging an order on liability for penalties. |
| In re ABC Learning Centres Ltd | N/A | Yes | 728 F 3d 301 | United States | Cited for the public policy consideration of ensuring the orderly and efficient recovery of assets for the benefit of creditors. |
| In re Fairfield Sentry Ltd. | Bkrtcy SDNY | Yes | 440 BR 60 | United States | Discusses the burden of proof in rebutting the presumption regarding the location of the center of main interests (COMI). |
| In re Fairfield Sentry Ltd. | N/A | Yes | 714 F 3d 127 | United States | Discusses the burden of proof in rebutting the presumption regarding the location of the center of main interests (COMI). |
| In the Matter of Videology Limited v In the Matter of the Cross-Border Insolvency Regulations 2006 | English High Court of Justice | Yes | [2018] EWHC 2186 (Ch) | England and Wales | Discusses the English approach to determining the center of main interests (COMI) under the Recast EIR. |
| Interedil Srl v Fallimento Interedil Srl | European Court of Justice | Yes | Case C-369/09 | European Union | Discusses the European approach to determining the center of main interests (COMI) under the Recast EIR. |
| Susanne Staubitz-Schreiber | European Court of Justice | Yes | Case C-1/04 | European Union | Discusses the European approach to determining the center of main interests (COMI) under the Recast EIR. |
| Moore, as Debtor-in-Possession of Australian Equity Investors v Australian Equity Investors | Federal Court of Australia | Yes | [2012] FCA 1002 | Australia | Discusses the Australian approach to determining the center of main interests (COMI). |
| Legend International Holdings Inc (as debtor in possession of the assets of Legend International Holdings Inc) v Legend International Holdings Inc | Supreme Court of Victoria | Yes | [2016] VSC 308 | Australia | Discusses the Australian approach to determining the center of main interests (COMI). |
| Wood v Astra Resources Ltd (UK Company No 07620218) | Federal Court of Australia | Yes | [2016] FCA 1192 | Australia | Discusses the Australian approach to determining the center of main interests (COMI). |
| In re Betcorp Ltd | Bkrtcy D Nev | Yes | 400 BR 266 | United States | Discusses the US approach to determining the center of main interests (COMI). |
| In re Ran | N/A | Yes | 607 F 3d 1017 | United States | Discusses the US approach to determining the center of main interests (COMI). |
| In re Ocean Rig UDW Inc | Bkrtcy SDNY | Yes | 570 BR 687 | United States | Discusses the US approach to determining the center of main interests (COMI). |
| In re Eurofood IFSC Ltd | N/A | Yes | [2006] 1 Ch 508 | England and Wales | Provides guidance on objective criteria for determining the center of main interests (COMI). |
| Kapila, in the matter of Edelsten | Federal Court of Australia | Yes | [2014] FCA 1112 | Australia | Discusses the need for an element of permanence in factors considered for COMI determination. |
| Young, Jr, in the matter of Buccaneer Energy Limited v Buccaneer Energy Limited | Federal Court of Australia | Yes | [2014] FCA 711 | Australia | Discusses considering the group structure in determining the center of main interests (COMI). |
| In re Railpower Hybrid Technologies Corp | Bkrtcy WD Pa | Yes | Case 09-41498-WWB | United States | Discusses the 'nerve center' approach in determining the center of main interests (COMI). |
| In Re SPhinX, Ltd. | Bankr SDNY | Yes | 351 BR 103 | United States | Lists factors considered in the COMI determination. |
| Re Opti-Medix Ltd (in liquidation) and another matter | N/A | Yes | [2016] 4 SLR 312 | Singapore | Applied a common law COMI test when deciding recognition issues. |
| Re Taisoo Suk (as foreign representative of Hanjin Shipping Co Ltd) | N/A | Yes | [2016] 5 SLR 787 | Singapore | Applied a common law COMI test when deciding recognition issues. |
| In re Gold & Honey, Ltd. | Bankr ED NY | Yes | 410 BR 357 | United States | Distinguished from the present case, involving a situation where recognition would directly contradict local proceedings. |
| In re Stanford International Bank Ltd and another | N/A | Yes | [2010] 3 WLR 941 | England and Wales | English courts determine the debtor’s COMI as at the date of the application to open insolvency proceedings abroad. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Companies Act (Cap 50) | Singapore |
| Section 354B of the Companies Act (Cap. 50) | Singapore |
| Tenth Schedule of the Companies Act | Singapore |
| Article 15 of the UNCITRAL Model Law on Cross-Border Insolvency | N/A |
| Article 17 of the Singapore Model Law | Singapore |
| Article 6 of the Singapore Model Law | Singapore |
| Article 17(1) of the Singapore Model Law | Singapore |
| Article 17(2) of the Singapore Model Law | Singapore |
| Article 17(2)(a) of the Singapore Model Law | Singapore |
| Article 8 of the Singapore Model Law | Singapore |
| Article 16(3) of the Singapore Model Law | Singapore |
| Article 2(d) of the Singapore Model Law | Singapore |
| Article 2(h) of the Singapore Model Law | Singapore |
| Article 2(f) of the Singapore Model Law | Singapore |
| Article 2(g) of the Singapore Model Law | Singapore |
| Article 20(1) of the Singapore Model Law | Singapore |
| Article 2(i) of the Singapore Model Law | Singapore |
| Article 20(2) of the Singapore Model Law | Singapore |
| Article 21(1)(d) of the Singapore Model Law | Singapore |
| Article 21(1)(e) of the Singapore Model Law | Singapore |
| Article 23(1) of the Singapore Model Law | Singapore |
| Article 21(1)(g) of the Singapore Model Law | Singapore |
| Bankruptcy Code 11 USC | United States |
| US Bankruptcy Code § 1516(c) | United States |
| US Bankruptcy Code § 1502 | United States |
| s 73B of the Conveyance and Law of Property Act (Cap 61, 1994 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Cross-Border Insolvency
- UNCITRAL Model Law
- Center of Main Interests (COMI)
- Foreign Main Proceeding
- Foreign Representative
- Recognition
- Public Policy
- Singapore Injunction
- Chapter 7 Trustee
- Automatic Stay
15.2 Keywords
- Cross-Border Insolvency
- UNCITRAL Model Law
- COMI
- Singapore
- US Bankruptcy
- Recognition
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Recognition of foreign insolvency proceedings | 95 |
| Cross-Border Insolvency | 85 |
| Bankruptcy | 75 |
| Company Law | 30 |
| International Commercial Law | 25 |
| International Law | 20 |
16. Subjects
- Insolvency
- Cross-Border Insolvency
- Bankruptcy