Singapore legislation
Section 91
Section 91
Power of Court to make judicial management order and appoint judicial manager
(1)
Where a company or its directors (pursuant to a resolution of its members or the board of directors) or any creditor (including any contingent or prospective creditor), pursuant to section 90, makes an application (called in this section an application for a judicial management order) for an order that the company should be placed under the judicial management of a judicial manager, the Court may make a judicial management order in relation to the company if, and only if —
the Court is satisfied that the company is or is likely to become unable to pay its debts; and
the Court considers that the making of the order would be likely to achieve one or more of the purposes of judicial management mentioned in section 89(1).
(2)
A judicial management order made under subsection (1) must direct that during the period in which the company is in judicial management, the affairs, business and property of the company must be managed by a judicial manager appointed by the Court.
(3)
In any application for a judicial management order under subsection (1), the following apply:
the applicant must nominate a person who is a licensed insolvency practitioner, but is not the auditor of the company, to act as a judicial manager;
the person nominated to act as a judicial manager must file with the Court a statutory declaration that the person is not in a position of conflict of interest in accepting the appointment and performing the role of judicial manager;
the Court may reject the nomination of the applicant and appoint another person in place of the applicant’s nominee;
where a nomination is made by the company —
a majority in number and value of the creditors (including contingent or prospective creditors) may be heard in opposition to the nomination; and
the Court may, if satisfied as to the number and value of the creditors’ claims and as to the grounds of opposition, invite the creditors to nominate another person in place of the applicant’s nominee and, if the Court sees fit, adopt their nomination;
where a nomination is made by a person mentioned in subsection (4)(b)(ii) who has appointed or is entitled to appoint a receiver and manager, the Court must, when making a judicial management order, appoint the nominee of that person as judicial manager unless the Court considers that the appointment would not be appropriate because of the particular circumstances of the case;
nothing in this subsection prevents the Minister from nominating a person to act as a judicial manager if the Minister considers that the public interest so requires, and in such a case the Minister may be heard in support of the Minister’s nomination and, for this purpose, may be represented;
despite paragraph (a), where a person is nominated by the Minister and appointed by the Court to act as a judicial manager, that person need not be a licensed insolvency practitioner.
(4)
When an application for a judicial management order is made to the Court —
notice of the application must be published in the Gazette and in an English local daily newspaper, and a copy of the notice must be sent to the Registrar of Companies; and
notice of the application must be given —
to the company, in a case where a creditor is the applicant; and
to any person who has appointed, or is or may be entitled to appoint, a receiver and manager of the whole (or substantially the whole) of the company’s property under the terms of any debentures of the company secured by a floating charge, or by a floating charge and one or more fixed charges, that would be valid and enforceable in case of a liquidation of the company.
(5)
For the purposes of subsection (4)(b)(ii), in the case of any such floating charge created by an instrument before 15 May 1987, that instrument is deemed to contain a power to appoint a receiver and manager in the event that an application under this section is made for the appointment of a judicial manager, with the result that the holder of that floating charge must, in accordance with subsection (4)(b), be given notice of the application.
(6)
Subject to subsection (10), the Court must dismiss an application for a judicial management order if —
the making of the order is opposed by a person who has appointed, will appoint or is entitled to appoint, a receiver and manager mentioned in subsection (4)(b)(ii); and
the Court is satisfied that the prejudice that would be caused to that person if the order is made is disproportionately greater than the prejudice that would be caused to unsecured creditors of the company if the application is dismissed.
(7)
On hearing the application for a judicial management order, the Court may dismiss the application or adjourn the hearing conditionally or unconditionally or make an interim order or any other order that the Court thinks fit.
(8)
A judicial management order must not be made in relation to a company —
after the company has gone into liquidation;
where the company is a banking corporation or is a finance company licensed under the Finance Companies Act 1967;
where the company is a licensed insurer licensed under the Insurance Act 1966; or
where the company belongs to such class of companies as the Minister may by order in the Gazette prescribe.
(9)
The costs and expenses of any unsuccessful application for a judicial management order made under this section must, unless the Court otherwise orders, be borne by the applicant and, if the Court considers that the application is frivolous or vexatious, the Court may make such orders, as the Court thinks just and equitable, to redress any injustice that may have resulted.
(10)
Nothing in this section precludes a Court —
from making a judicial management order and appointing a judicial manager, if the Court considers that the public interest so requires; or
from appointing, at any time between the making of an application for a judicial management order and the making of the judicial management order or the determination of the application, an interim judicial manager under section 92.