Charles Thresh & Anor

Facts

British Steamship Protection and Indemnity Association (Bermuda) Limited was an insurer licensed in Bermuda. On a petition by the Bermuda Monetary Authority filed on 12 September 2022, the Supreme Court of Bermuda ordered it wound up on 28 October 2022 and appointed Charles Thresh and Michael Morrison as joint provisional liquidators. The petition did not allege insolvency; it relied on regulatory breaches under s 35 of the Bermuda Insurance Act 1978, including failing to appoint an approved auditor or a principal representative, failing to file statutory financial returns, and having no registered office, with the authority saying the company had in effect left Bermuda for Singapore.

The liquidators applied in Originating Application No 697 of 2023 under Art 17 of the UNCITRAL Model Law on Cross-Border Insolvency as adopted in Singapore to recognise the Bermuda proceeding and winding-up order. They said they needed information and documents held in Singapore. The company's sole shareholder and its manager, effectively owned or controlled by Mr Li Yu, a director of the company who is a Singapore citizen living in Singapore, opposed recognition. It was undisputed that premiums on the company's policies were paid to EF Marine Pte Ltd, a Singapore company owned and controlled by Mr Li, who said it received them as agent for the company's reinsurer.

Issues

1. Whether the Bermuda winding-up was a foreign proceeding, being collective and under a law relating to insolvency or adjustment of debt.
2. Whether recognition would be contrary to Singapore public policy.
3. Whether Bermuda was the company's centre of main interests.
4. Whether the Singapore court had jurisdiction under Art 4(2) and whether provisional liquidators had standing.

Holding

The High Court allowed the application and recognised the Bermuda proceeding and winding-up order as a foreign main proceeding. It made no costs order against the non-parties and ordered the applicants' costs to be paid out of the company's assets as an expense of the liquidation.

Reasoning

Applying Ascentra Holdings, Inc (in official liquidation) and others v SPGK Pte Ltd [2023] SGCA 32, a company need not be insolvent; it is enough that the law under which the proceeding is conducted contains provisions dealing with insolvency. Section 35(1)(a) of the Bermuda Insurance Act 1978 provides for winding up on the ground of inability to pay debts, so that requirement was met. The court rejected the liquidators' alternative claim that the company was actually insolvent, as there was no evidence of that. The proceeding was collective: winding up under the Act follows the ordinary compulsory liquidation procedure with pari passu distribution, and the liquidators had full powers for the benefit of all creditors. Lack of notice to creditors so far was irrelevant to this element.

On public policy, the non-parties did not identify the policy said to be breached or its authoritative source. No Bermudan law on service was shown to have been breached, and Mr Li chose not to challenge the order. Complaints about costs and the liquidators' conduct belonged before the Bermuda court.

On centre of main interests, Mr Li gave no objective evidence for his assertions that the business was run from China, Ukraine and Russia, and did not say where the assets were. The company ran an insurance business licensed and regulated in Bermuda, and its statutory books were there, so Bermuda was its centre of main interests.

Art 4(2)(b) was satisfied because Singapore was the appropriate forum, given Mr Li's residence, EF Marine's receipt of premiums and the need to obtain documents here. The provisional liquidators remained foreign representatives with standing.

From the judgment