[COMPANIES (WINDING UP) NO: 20-28-2-1997]
HAMID SULTAN ABU BACKER JC
18 JUNE 2008
COMPANY LAW: Winding up - Stay of proceedings - Application for - Whether a stay under s. 243 Companies Act 1965 could be given as of right - Whether stay of Winding up order should be sparingly exercised if no appeal pending - Whether there were cogent reasons for granting stay The applicant, through a notice of motion, sought leave and an order to stay winding up proceedings under s. 243 of Companies Act 1965 (CA) when there was no appeal pending in the court of appeal and the winding up order was given as early as 23 June 1997. The application was based on the following grounds: (i) the respondent had fully satisfied the debts owing to the petitioner; (ii) there were no other debts owing by the respondent to other creditors; (iii) there was nothing for the liquidator to investigate with regard to the conduct of the respondent, its directors and/or its officer. The issues that arose were (a) whether a stay under s. 243 could be given as of right and (b) whether a stay could be given when there was no pending appeal or cogent reasons for granting the stay. Held (dismissing notice of motion encl. 40):
(1) As a general rule, the court has jurisdiction to set aside, vary or rescind any of its order, inclusive of a winding up order for good and explicit reasons taking into consideration public interest, notwithstanding s. 243 of CA 1965 does not encompass such wide powers. (para 7) (2) Stay of winding up order should be sparingly exercised if there was no appeal pending; and in almost all cases the stay would not be granted if there was substantial delay in making the application. The reasons for the delay must be satisfactorily explained. (para 7) (3) The affidavit in support must set out valid reasons for the application. It was not sufficient to assert that...