Re Doxa Technology Ltd

• Jurisdiction: Bermuda
• Judgment Date: 20 October 2003
• Docket Number: Civil Jurisdiction 2003 No. 137
• Date: 20 October 2003
• Court: Supreme Court (Bermuda)

In The Supreme Court of Bermuda

Kawaley, J

Civil Jurisdiction 2003 No. 137

BETWEEN:

Re Doxa Technology Ltd.

Mr. J. Riihiluoma for the Official Receiver

The following cases were referred to in the judgment:

Re SFH Trading & Brokerage Ltd (in liquidation)BDLR [2001] Bda LR 75

Application that dividend be declared ineffective — Whether evidence of a dividend — Exchange of shares

RULING of Kawaley, J

Background

By A Summons dated July 2, 2003, the Official Receiver as Liquidator of the Company applied for the following substantive relief:

‘(1) That the declaration of a dividend by the Company as reflected in the minutes of the Board of Directors dated 4^th February, 2002 and the Minutes of Members dated 22^nd March, 2002 be declared as ineffective as a matter of law;

(2)Alternatively in the event in the event that no order is granted in the form of relief requested at paragraph 2, that the Shareholders of the Company are declared to be creditors of the Company the amounts to be determined by the Liquidator in accordance with the Companies Act 1981 and the Companies (Winding-up) Rules 1982 and that such entitlement will rank in accordance with section 158(g) of the Companies Act 1981.’

Counsel informed the Court that notice of the present application had been given to all shareholders and creditors prior to the first return date at which one creditor had appeared in support thereof.

In addition, Mr. Riihiluoma explained that his client's Summons out of an abundance of caution sought a direction authorizing the Liquidator to bring this application in the name of the Company, as conflicts on the Committee of Inspection prevented that body from authorizing this application. However he conceded that the application had been styled as an application by the liquidator in the liquidation, and did not press for this procedural aspect of the relief originally sought.

The Issues

The real issue raised by the present application is whether there is credible evidence that a dividend was declared by the Company at a special general meeting held on March 22, 2003 (‘the SGM’).

The Facts

Mr. Riihiluoma demonstrated with considerable force and lucidity why no shareholders had the temerity to seek to contradict his submissions, and why Longbow Finance SA did not consider its further support was needed in aid of the Liquidator's application.

The salient facts, set out in the affidavit sworn by Stephen Lowe on June 20, 2003, which I accept as...