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In the Matter of the Companies Law (2011 Revision) and In the Matter of Emergent Capital Limited (In Liquidation) between KTC and RAAL Limited Cause No. FSD 29 or 2011, per Jones J (5 January 2012)

January 2012 LiquidationWinding UpInsolvency

CAYMAN ISLANDS

GRAND COURT

COMPANIES – WINDING UP – TRANSACTION APPROVAL PROCEEDING COSTS

The Company’s official liquidators brought a sanction application seeking directions in respect of a dispute about the respective shareholdings of the Company’s only two shareholders. Pursuant to the directions of the Court in that application, the matter was conducted as though it were an action, inter partes, between those two shareholders. The official liquidators had no ongoing involvement in the application: One shareholder defended against the other’s claim in its own interest.

At the conclusion of the matter, the Court held that costs should follow the costs in the cause. Leave to appeal of the order for costs was sought and denied. The decision turned on the proper characterisation of the application. If properly characterised as a sanction application, principles contained in Companies Winding Up Rules (“CWR”) Order 24 would apply, in which case costs would ordinarily be payable out of the assets of the company. If properly characterised as an, inter partes, application between the shareholders, the principles contained in GCR O. 62, R.4 would apply, under which costs would generally follow the event.

 

To continue reading full articles in PDF format:
In the Matter of the Companies Law (2011 Revision) and In the Matter of Emergent Capital Limited (In Liquidation) between KTC and RAAL Limited Cause No. FSD 29 or 2011, per Jones J (5 January 2012)

 

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