Re Gilt Construction Ltd

• Jurisdiction: Ireland
• Judge: Mr. Justice O'Hanlon
• Judgment Date: 03 June 1994
• Neutral Citation: 1994 WJSC-HC 2939
• Date: 03 June 1994
• Court: High Court
• Docket Number: Record No. 126 Cos./1994

GILT CONSTRUCTION LTD v.

IN THE MATTER OF THE COMPANIES ACTS 1963 - 1990

AND

IN THE MATTER OF GILT CONSTRUCTION LIMITED (IN VOLUNTARY LIQUIDATION)

1994 WJSC-HC 2939

Record No. 126 Cos./1994

THE HIGH COURT

Synopsis:

WINDING UP

Liquidator

Replacement - Application - Dismissal - Voluntary winding up - Applicant sought winding up by court - Lack of trust between co- owners - Competence of liquidator not challenged - Modest assets of company - (1994/126 Cos - O'Hanlon J. - 3/6/94)

|In re Gilt Construction Ltd.|

Citations:

COMPANIES ACTS 1963 – 1990

BELFAST TAILORS CO-PARTNERSHIP, IN RE 1909 1 IR 49

J D SWAIN LTD, IN RE 1965 1 AER 761

LOWERSTOFT TRAFFIC SERVICES LTD, IN RE 1986 BCLC 81

PALMER MARINE SURVEYS LTD, IN RE 1986 1 WLR 573

FALCON R J DEVELOPMENT, IN RE 1987 BCLC 437

COMPANIES ACT 1963 S280

1 Judgment of Mr. Justice O'Hanlon delivered the3rd day of June 1994.

2 In this case the Petitioner, Noel McDonald, a creditor and member of the above-named company, asks to have the company wound up by the Court under the provisions of the Companies Act 1963, as amended, and that the voluntary liquidation of the company which is already in progress should be halted and that a liquidator should be appointed by the Court to supplant Mr. Michael Butler who has already been appointed as voluntary liquidator.

3 The grounds upon which the petition is based refer mainly to a loss of trust between the two persons - the Petitioner and Nell Kearney - who were responsible for setting up the company in the first place and were the sole shareholders during the brief life-span of the company and when the decision was taken to wind it up. They are each substantial creditors of the company, their claims against the company now amounting to £62,650 in the case of the Petitioner and £60,700 in the case of Mr. Kearney.

4 There is a deficiency in the assets of the company, which must now be regarded as being insolvent. Its total indebtedness is shown in the Directors' Statement of Affairs of the 21st April 1994, as amounting to a sum of £156,996, of which a sum in excess of £120,000 is stated to represent moneys owing to the Petitioner and to Mr. Kearney.

5 In these circumstances, the two parties most concerned, who may be loosely referred to as partners, concurred in a decision to wind up the company voluntarily, and the necessary resolution was passed for this purpose. It was also agreed at the meeting of the members that Mr. John Murphy, Chartered Accountant, would be appointed as liquidator, but at the meeting of creditors which followed, Mr. Kearney had a change of heart and supported the appointment of Mr. Michael Butler, who was appointed with the support of all creditors voting personally or by proxy other than the Petitioner and the company's solicitor, who was also a creditor.

6 The Petitioner is profoundly suspicious about this turn in events and claims that his erstwhile partner, Mr. Kearney, has been manipulating the assets of the company for his own benefit and to the detriment of the Petitioner, and now seeks to control the liquidation of the company, aided by his own nominees, so that the legitimate interests of the Petitioner will be disregarded and that the liquidation will be carried out in the manner most favourable to Mr. Kearney and in a manner which will fail to uncover prior irregularities in the manner in which Mr. Kearney is alleged to have dealt...