Transbilt Engineering Pte Ltd (in liquidation) v Finebuild Systems Pte Ltd

JudgeChao Hick Tin JA
Judgment Date11 July 2005
Neutral Citation[2005] SGCA 33
Citation[2005] SGCA 33
Defendant CounselA Rajandran (A Rajandran Joseph and Nayar)
Published date13 July 2005
Plaintiff CounselNandakumar Renganathan and Gong Chin Nam (T M Hoon and Co)
Date11 July 2005
Docket NumberCivil Appeal No 115 of 2004
CourtCourt of Appeal (Singapore)
Subject MatterWinding up,Whether court should exercise discretion to set aside rights of liquidator to allow continuation of garnishee proceedings,Insolvency Law,Whether creditor entitled to retain benefit of garnishee order,Debtor company wound up before creditor company's garnishee order nisi made absolute,Section 334(1)(c) Companies Act (Cap 50, 1994 Rev Ed)

11 July 2005

Choo Han Teck J (delivering the judgment of the court):

1 The appellant and the respondent were companies in the construction and engineering business. The respondent obtained judgment against the appellant in the District Court and on 4 May 2004 obtained an attachment order nisi by way of garnishee proceedings against the garnishee for $84,000. The garnishee was ordered to show cause why the order should not be made absolute, and the show cause was scheduled to take place on 1 June 2004. On 31 May 2004, the garnishee notified the respondent that it was indebted to the appellant in the sum of $84,000. On the same day the appellant commenced a voluntary winding up by reason of its inability to pay its debts, and a provisional liquidator was also appointed on the same day. A meeting of its creditors was scheduled to take place on 10 June 2004, and consequently, the show cause proceedings were adjourned to 13 July 2004. On 10 June 2004, the meeting endorsed and passed the requisite resolution for winding up the appellant. By virtue of s 291(6)(a) of the Companies Act, (Cap 50, 1994 Rev Ed) (“the Act”), winding-up proceedings were deemed to have commenced on 31 May 2004, the day the provisional liquidator was appointed. The respondent, a creditor, was also notified of the creditors’ meeting on 31 May 2004. There was no dispute that that was the date of the commencement of the winding-up proceedings.

2 At the show cause hearing on 13 July 2004, the District Court granted leave to the respondent to apply to the High Court for relief under s 334 of the Act. The show cause hearing was consequently adjourned. The respondent then applied to the High Court on 26 August 2004 and obtained an order setting aside the liquidator’s rights. The application was made under s 334(1)(c), which reads as follows:

Where a creditor has issued execution against the goods or land of a company or has attached any debt due to the company and the company is subsequently wound up, he shall not be entitled to retain the benefit of the execution or attachment against the liquidator unless he has completed the execution or attachment before the date of the commencement of the winding up, but the rights conferred by this subsection on the liquidator may be set aside by the Court in favour of the creditor to such extent and subject to such terms as the Court thinks fit.

The only issue before us was whether the undisputed facts found by the High Court justified an order setting aside the liquidator’s rights. The principal provision in s 334(1) of the Act was intended to provide a clear path for a liquidator to perform his tasks, and to that end, it expressly provides that any inchoate execution and attachment will be nullified in that the executing creditor may not reap the benefit of the execution or attachment. It means also that no steps may be taken to complete the inchoate execution or attachment proceedings, otherwise the provision will be substantially weakened and itself nullified. This provision is also necessary to prevent any disorganised or unfair rush by creditors to put assets of the company beyond the liquidator’s control and thus...

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3 cases
  • SCK Serijadi Sdn Bhd v Artison Interior Pte Ltd
    • Singapore
    • Court of Appeal (Singapore)
    • 15 January 2019
    ...of decision of the court): Introduction This court in Transbilt Engineering Pte Ltd (in liquidation) v Finebuild Systems Pte Ltd [2005] 3 SLR(R) 550 (“Transbilt”) at [4]–[5] held that a judgment creditor who has obtained a garnishee order nisi is to be treated as an unsecured creditor and a......
  • Re Projector SA
    • Singapore
    • High Court (Singapore)
    • 12 December 2008
    ...up at this stage, but as the Court of Appeal reiterated in Transbilt Engineering Pte Ltd (in liquidation) v Firebuild Systems Pte Ltd [2005] 3 SLR 550 at [5], an unsecured creditor of an insolvent company should not be allowed to retain the benefit of a garnishee order “if the court is of t......
  • SCK Serijadi Sdn Bhd v Artison Interior Pte Ltd
    • Singapore
    • High Court (Singapore)
    • 9 January 2018
    ...relied solely on the Court of Appeal’s decision in Transbilt Engineering Pte Ltd (in liquidation) v Finebuild Systems Pte Ltd [2005] 3 SLR(R) 550 (“Transbilt”)2 and submitted that Transbilt applied as it was on all fours with the present case.3 In response, the plaintiff submitted that this......
3 books & journal articles
  • CROSS-BORDER INSOLVENCY AND ITS IMPACT ON ARBITRATION
    • Singapore
    • Singapore Academy of Law Journal No. 2014, December 2014
    • 1 December 2014
    ...[21]; Re HIH Casualty and General Insurance Ltd[2008] 1 WLR 852 at [40]. 118 Transbilt Engineering Pte Ltd v Finebuild Systems Pte Ltd [2005] 3 SLR(R) 550 at [2]. 119 Adrian Briggs, “Rubin and New Cap: Foreign Judgments and Insolvency” (Jones Day Professorship of Commercial Law Lecture, 201......
  • Insolvency Law
    • Singapore
    • Singapore Academy of Law Annual Review No. 2005, December 2005
    • 1 December 2005
    ...there were three other Court of Appeal cases on insolvency law, namely, Transbilt Engineering Pte Ltd v Finebuild Systems Pte Ltd[2005] 3 SLR 550 (the uncompleted execution of a judgment against a company going into liquidation), Ng Bok Eng Holdings Pte Ltd v Wong Ser Wan[2005] 4 SLR 561 (t......
  • Civil Procedure
    • Singapore
    • Singapore Academy of Law Annual Review No. 2018, December 2018
    • 1 December 2018
    ...44 [2018] SGHC 142. See paras 8.126–8.128 and paras 8.148–8.150 below. 45 [2018] SGHCR 3. 46 [2017] 4 SLR 789. 47 [2018] SGHC 8. 48 [2005] 3 SLR(R) 550. 49 Cap 50, 2006 Rev Ed. 50 See para 8.16 above. 51 [2018] SGHC 232. 52 [2018] 3 SLR 461. 53 Multi-Pak Singapore Pte Ltd v Intraco Ltd [199......

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