Re Halley's Departmental Store Pte Ltd

CourtHigh Court (Singapore)
JudgeG P Selvam J
Judgment Date25 January 1996
Neutral Citation[1996] SGHC 10
Citation[1996] SGHC 10
Defendant CounselTan Lee Cheng (Lee Bon Leong & Co)
Plaintiff CounselMichael Moey (Moey & Yuen)
Published date19 September 2003
Docket NumberOriginating Petition No 19 of 1995
Date25 January 1996
Subject MatterWhether scheme to genuinely offer creditors satisfaction or avert independent investigation into affairs of the company,ss 210(1) & (3) Companies Act (Cap 50, 1994 Ed),Factors to be considered,Approval by the court,Schemes of arrangement,Companies


The petitioners, Halley`s Departmental Store Pte Ltd, made this application under s 210 of the Companies Act (Cap 50, 1994 Ed) (the Act) praying that the scheme of arrangement set out in the schedule to it to be sanctioned by the court so as to be binding on the company and all its unsecured creditors. The scheme provided for payment of three cents to every dollar of unsecured debt. The English equivalent of s 210 was s 206 of the Companies Act 1948.

The scheme of arrangement was as follows:

It is proposed that each unsecured creditor will be paid 10 cents to every dollar owed by Halley`s Departmental Store Pte Ltd to them provided full recovery is made from the company`s trade creditors. Three cents to every dollar owed will be paid over two equal monthly instalments. The date for commencement of payment of the instalments shall be deferred to one month after the court order sanctioning the approval of the creditors is granted and the balance at the end of every quarter in proportion to the moneys recovered from the trade debtors less the legal costs incurred.

Section 210(1) of the Act provides that:

Where a compromise or arrangement is proposed between a company and its creditors or any class of them or between the company and its members or any class of them, the court may, on the application in a summary way of the company or of any creditor or member or the company, or, in the case of a company being wound up, of the liquidator, order a meeting of the creditors or class of creditors or of the members of the company or class of members to be summoned in such manner as the court directs.

Section 210(3) of the Act provides that:

If a majority in number representing three-fourths in value of the creditors or class of creditors or members or class of members present and voting either in person or by proxy at the meeting or the adjourned meeting agrees to any compromise or arrangement, the compromise or arrangement shall, if approved by order of the Court, be binding on all the creditors or class of creditors or on the members or class of members, as the case may be, and also on the company or, in the case of a company in the course of being wound up, on the liquidator and contributories of the company.

In this case the company obtained an order to convene a meeting and subsequently a meeting was held. The company had the requisite number to win the day. One of the unsecured creditors, Twenty Eight Accessories Trading Pte Ltd (Twenty Eight Accessories), abstained from voting.

The company then petitioned the court for approval of the scheme. Twenty Eight Accessories opposed the petition.

Background facts

It would be convenient to narrate the facts leading to the petition to the court. The company was established with the principal object of operating business stores. The authorized capital was $5m. The paid up capital was $2m.

On 5 November 1994, Twenty Eight Accessories obtained a judgment for $256,183.86 for goods sold. As the judgment debt was not satisfied they filed a petition to wind up the company. On 17 March 1995 the company moved for and obtained a stay of the winding-up proceedings. The company told the court that it would make a scheme of arrangement for the consideration of the unsecuredcreditors. The suggestion at that time was `at least three cents to a dollar in return for their debt`. It was said it could be as much as ten cents to the dollar. On the other hand, said the company, in the event of winding up the creditors may not recover even two cents to the dollar.

On 7 April 1995 the company obtained an order to convene the meeting for the purpose of considering a scheme of arrangement between the company and the unsecured creditors. A provisional list of unsecured creditors was submitted. The list contained some 70 names including Twenty Eight Accessories. The...

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41 cases
  • Re Econ Corp Ltd
    • Singapore
    • High Court (Singapore)
    • 24 Noviembre 2003
    ...Reply Submissions the differences (12) between the facts here and in Wah Yuen's case. Equally, Re Halley's Departmental Store Pte Ltd [1996] 2 SLR 70 did not apply. The Court was reminded that an overwhelming majority (in value) of unsecured creditors had voted in favour of the approved sch......
  • Wah Yuen Electrical Engineering Pte Ltd v Singapore Cables Manufacturers Pte Ltd
    • Singapore
    • Court of Appeal (Singapore)
    • 28 Mayo 2003
    ...this concern. The judge found the facts of the present case to be broadly analogous to those of Re Halley’s Departmental Store Pte Ltd [1996] 2 SLR 70, where Selvam J had declined to sanction the proposed scheme. The judge did not deal with Singapore Cables’ contention that the related part......
  • United Overseas Bank Ltd v Ng Huat Foundations Pte Ltd
    • Singapore
    • High Court (Singapore)
    • 10 Marzo 2005
    ...Act, the following statement of principle by G P Selvam J in the Singapore High Court decision of Re Halley’s Departmental Store Pte Ltd [1996] 2 SLR 70 at 74, In my view, in an application for approval of a scheme of arrangement under s 210 of the Act, the primary question the court must a......
    • Malaysia
    • High Court (Malaysia)
    • Invalid date
    ...furnish full information to the creditors and the Court before the Court can sanction the scheme (Re Halley’s Departmental Store Pte Ltd [1996] 2 SLR 70); (ii) The explanatory statement should provide “all the information reasonably necessary to enable the recipients to determine how to vot......
  • Request a trial to view additional results
1 books & journal articles
  • Insolvency Law
    • Singapore
    • Singapore Academy of Law Annual Review No. 2003, December 2003
    • 1 Diciembre 2003
    ...or otherwise) the grant of court sanction for a scheme of arrangement, apart from the decision in Re Halley”s Departmental Store Pte Ltd[1996] 2 SLR 70. These cases have provided a useful forum for the courts to restate, develop and refine the principles governing the grant of court sanctio......

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