GVR Global Pte Ltd v Wayne Burt Pte Ltd: Stay of Winding-Up Order Application

GVR Global Pte Ltd, the plaintiff and controlling shareholder of Wayne Burt Pte Ltd (first defendant), applied to the High Court of Singapore for an indefinite stay of a winding-up order made against Wayne Burt Pte Ltd, which was sought by M.R.K. Enterprises Private Ltd (second defendant). The plaintiff argued that the debt claimed by the second defendant was not actually owed. Ang Cheng Hock J dismissed the application, finding that the US$2 million transfer was indeed a loan and that Wayne Burt Pte Ltd was insolvent. The interim stay order was discharged.

1. Case Overview

1.1 Court

High Court of the Republic of Singapore

1.2 Outcome

Originating Summons dismissed and interim stay order discharged.

1.3 Case Type

Insolvency

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Application for stay of winding-up order. The court dismissed the application, finding the debt existed and the company was insolvent.

1.7 Decision Date

29 April 2020

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
GVR Global Pte Ltd	Plaintiff	Corporation	Application Dismissed	Lost	N K Rajarh of K&L Gates Straits Law LLC Rajaram Muralli Raja of K&L Gates Straits Law LLC Kyle Gabriel Peters of K&L Gates Straits Law LLC
Wayne Burt Pte Ltd	Defendant	Corporation	Winding-up Order Stands	Lost
M.R.K. Enterprises Private Ltd	Defendant	Corporation	Winding-up Order Upheld	Won	Ramesh s/o Varathappan of Tito Isaac & Co LLP Isaac Tito Shane of Tito Isaac & Co LLP Jaspreet Kaur Purba of Tito Isaac & Co LLP

3. Judges

Judge Name	Title	Delivered Judgment
Ang Cheng Hock	Judge	Yes

4. Counsels

Counsel Name	Organization
N K Rajarh	K&L Gates Straits Law LLC
Rajaram Muralli Raja	K&L Gates Straits Law LLC
Kyle Gabriel Peters	K&L Gates Straits Law LLC
Ramesh s/o Varathappan	Tito Isaac & Co LLP
Isaac Tito Shane	Tito Isaac & Co LLP
Jaspreet Kaur Purba	Tito Isaac & Co LLP

4. Facts

The second defendant issued a statutory demand to the first defendant for US$2 million.
The plaintiff claimed the US$2 million was for shares in Raycom, not a loan.
The second defendant obtained a winding-up order against the first defendant.
The plaintiff applied for a stay of the winding-up order.
The court found Mr. Mahesh's evidence to be inconsistent and unreliable.
The court found that the first defendant's directors defied an order to cooperate with the liquidator.
The court found the first defendant to be insolvent.

5. Formal Citations

GVR Global Pte Ltd v Wayne Burt Pte Ltd and another, Originating Summons No 1443 of 2018, [2020] SGHC 87

6. Timeline

Date	Event
2013-06-12	US$2 million loan extended to the first defendant.
2018-09-14	Second defendant issued a statutory demand to the first defendant.
2018-10-23	Second defendant applied for the first defendant to be wound up.
2018-11-16	Woo Bih Lih J ordered that the first defendant be wound up.
2018-11-23	Plaintiff commenced proceedings for a stay of the winding-up order.
2018-12-12	Interim stay of the winding-up order granted.
2019-06-18	Hearing commenced.
2020-04-30	Judgment delivered.

7. Legal Issues

Stay of Winding-Up Order
- Outcome: The court found no basis to stay the winding-up order.
- Category: Substantive
- Sub-Issues:
  - Proof of solvency
  - Fraudulent procurement of winding-up order
Inherent Jurisdiction of the Court
- Outcome: The court did not make a determination on this issue as it was abandoned by the plaintiff.
- Category: Procedural
Existence of Debt
- Outcome: The court found that a debt of US$2 million existed between the first and second defendants.
- Category: Substantive

8. Remedies Sought

Indefinite Stay of Winding-Up Order
Setting Aside of Winding-Up Order

9. Cause of Actions

Application for Stay of Winding-Up Order

10. Practice Areas

Insolvency
Commercial Litigation

11. Industries

No industries specified

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Re Nalpon Zero Geraldo Mario	Court of Appeal	Yes	[2013] 3 SLR 258	Singapore	Cited regarding the inherent powers of the court.
Interocean Holdings Group (BVI) Ltd v Zi-Techasia (Singapore) Pte Ltd (in liquidation)	High Court	No	[2014] 2 SLR 485	Singapore	Cited regarding whether a winding-up order can be set aside once perfected.
Standard Chartered Bank (Singapore) Ltd v Construction Professional Resources Pte Ltd	High Court	Yes	[2019] 5 SLR 709	Singapore	Cited regarding the use of the court's inherent powers to set aside a winding-up order.
Phang Choo Ong v Gilcom Investment Pte Ltd (LRG Investments Pte Ltd and another, non-parties)	High Court	No	[2016] 3 SLR 1156	Singapore	Cited for the principles guiding the court's discretion under section 279(1) of the Companies Act regarding stay of winding-up orders.
Chimbusco International Petroleum (Singapore) Pte Ltd v Jalalludin bin Abdullah and other matters	High Court	No	[2013] 2 SLR 801	Singapore	Cited regarding the onus on the defendant to show why insolvency proceedings should be stayed.
In re Calgary and Edmonton Land Co Ltd	N/A	Yes	[1975] 1 WLR 355	N/A	Cited regarding the burden of proof on the plaintiff to make out a case that carries conviction.
Lim Mong Hong v Public Prosecutor	N/A	No	[2003] 3 SLR(R) 88	N/A	Cited regarding the probative value of entries in account books under section 34 of the Evidence Act.
SIC College of Business and Technology Pte Ltd v Yeo Poh Siah and others	Court of Appeal	No	[2016] 2 SLR 118	Singapore	Cited regarding the relevance of direct evidence as opposed to relying only on accounts.
Re Ice-Mack Pte Ltd (in liquidation)	N/A	Yes	[1989] 2 SLR(R) 283	N/A	Cited regarding the importance of not placing undue weight on accounts when direct evidence is available.
Re Inter-Builders Development Pte Ltd	N/A	No	[1991] 1 SLR(R) 126	N/A	Cited regarding the requirements for a statutory demand under section 254(2)(a) of the Companies Act.
Lalwani Ashok Bherumal v Lalwani Shalini Gobind and another	N/A	Yes	[2019] 4 SLR 1304	N/A	Cited regarding the court's power to remedy irregularities in relation to statutory demands.

13. Applicable Rules

Rule Name
Rules of Court (Cap 322, R 5, 2014 Rev Ed) O 92 r 4

14. Applicable Statutes

Statute Name	Jurisdiction
Companies Act (Cap 50, 2006 Rev Ed)	Singapore
Companies Act (Cap 50, 2006 Rev Ed) s 279	Singapore
Evidence Act (Cap 97, 1997 Rev Ed) s 34	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Winding-up order
Statutory demand
Inherent jurisdiction
Solvency
Promissory notes
Liquidator
Share purchase agreement

15.2 Keywords

winding up
stay of order
insolvency
companies act
singapore

17. Areas of Law

Area Name	Relevance Score
Winding Up	95
Insolvency Law	90
Company Law	50
Fraud and Deceit	40
Contract Law	30

16. Subjects

Insolvency
Corporate Law
Civil Procedure