Ascentra Holdings v SPGK: Cross-Border Insolvency & Foreign Proceeding Recognition

Ascentra Holdings, Inc (in official liquidation), Graham Robinson, and Chua Suk Lin Ivy applied for recognition of Ascentra's Cayman liquidation in Singapore under the Insolvency, Restructuring and Dissolution Act 2018. SPGK Pte Ltd opposed the application. The High Court dismissed the application, holding that the Model Law and the Third Schedule were not intended to apply to a solvent company. The court found that Ascentra's liquidation did not have its basis in a law relating to insolvency, as Ascentra was solvent.

1. Case Overview

1.1 Court

General Division of the High Court

1.2 Outcome

Application dismissed

1.3 Case Type

Insolvency

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Singapore court denies recognition of Cayman liquidation as a 'foreign proceeding' under IRDA, as Ascentra Holdings was solvent.

1.7 Decision Date

2 April 2023

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Ascentra Holdings, Inc (in official liquidation)	Applicant	Corporation	Application Dismissed	Lost	Keith Han of Oon & Bazul LLP Angela Phoon of Oon & Bazul LLP
Chua Suk Lin Ivy	Applicant	Individual	Application Dismissed	Lost	Keith Han of Oon & Bazul LLP Angela Phoon of Oon & Bazul LLP
Graham Robinson	Applicant	Individual	Application Dismissed	Lost	Keith Han of Oon & Bazul LLP Angela Phoon of Oon & Bazul LLP
SPGK Pte Ltd	Respondent	Corporation	Application Dismissed	Won	Balakrishnan Ashok Kumar of BlackOak LLC Sanjev Gunasekaran of BlackOak LLC Berwin Chua of BlackOak LLC Gloria Chan of BlackOak LLC

3. Judges

Judge Name	Title	Delivered Judgment
Vinodh Coomaraswamy	Judge of the High Court	Yes

4. Counsels

Counsel Name	Organization
Keith Han	Oon & Bazul LLP
Angela Phoon	Oon & Bazul LLP
Balakrishnan Ashok Kumar	BlackOak LLC
Sanjev Gunasekaran	BlackOak LLC
Berwin Chua	BlackOak LLC
Gloria Chan	BlackOak LLC

4. Facts

Ascentra Holdings, Inc. is in official liquidation in the Cayman Islands.
Ascentra is a solvent company.
The liquidators of Ascentra sought recognition of the Cayman liquidation in Singapore.
SPGK Pte Ltd opposed the recognition application.
Ascentra's liquidation commenced as a voluntary winding up pursuant to a shareholders’ resolution.
Ascentra's directors failed to sign a declaration of solvency within 28 days of the commencement of the winding up.
Mr Robinson presented a petition to the Grand Court seeking an order that the liquidation of Ascentra continue under the supervision of the Grand Court.

5. Formal Citations

Re Ascentra Holdings, Inc (in official liquidation) and others (SPGK Pte Ltd, non-party), Originating Summons No 16 of 2022, [2023] SGHC 82

6. Timeline

Date	Event
2018-01-01	Shareholder disputes arose over Ascentra's business direction.
2021-06-01	Shareholders resolved to place Ascentra in voluntary liquidation.
2021-06-02	Ascentra filed documents to initiate voluntary liquidation with Cayman Islands Registrar.
2021-07-02	Mr. Robinson presented a petition to the Grand Court for continued liquidation supervision.
2021-09-17	Grand Court appointed Mr. Robinson and Ms. Chua as joint official liquidators.
2022-01-06	Applicants filed application under Article 15 of the Third Schedule.
2022-03-23	Hearing date
2022-03-25	Hearing date
2022-05-27	Hearing date
2023-04-03	Judgment issued

7. Legal Issues

Recognition of Foreign Proceeding
- Outcome: The court held that the Cayman liquidation of a solvent company was not a 'foreign proceeding' under the IRDA.
- Category: Substantive
- Sub-Issues:
  - Solvent liquidation
  - Interpretation of 'law relating to insolvency'

8. Remedies Sought

Recognition of foreign main proceeding
Recognition of foreign representatives
Granting of powers to liquidators

9. Cause of Actions

No cause of actions

10. Practice Areas

Cross-Border Insolvency
Liquidation
Recognition of Foreign Proceedings

11. Industries

No industries specified

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
United Securities Sdn Bhd (in receivership and liquidation) and another v United Overseas Bank Ltd	Court of Appeal	Yes	[2021] 2 SLR 950	Singapore	Cited for the four cumulative requirements which must be established before a proceeding is a “foreign proceeding” within the meaning of the Third Schedule.
Tan Cheng Bock v Attorney-General	N/A	Yes	[2017] 2 SLR 850	Singapore	Endorsed the three-stage approach to the purposive interpretation of a statutory provision.
Attorney-General v Ting Choon Meng and another appeal	N/A	Yes	[2017] 1 SLR 373	Singapore	Set out the three-stage approach to the purposive interpretation of a statutory provision.
Re Zetta Jet Pte Ltd and others (Asia Aviation Holdings Pte Ltd, intervener)	N/A	Yes	[2019] 4 SLR 1343	Singapore	Promotes consistency and comity for the Singapore courts to consider the 2013 Guide in the purposive interpretation of the Third Schedule.
Seow Wei Sin v PP	N/A	Yes	[2011] 1 SLR 1199	Singapore	It is impermissible to rely on extrinsic material “to give the statute a sense which is contrary to its express text”
BNY Corporate Trustee Services Ltd v Eurosail-UK 2007-3BL plc and others	N/A	Yes	[2013] 1 WLR 1408	UK	Analysed the content of the test of insolvency.
Sun Electric Power Pte Ltd v RCMA Asia Pte Ltd (formerly known as Tong Teik Pte Ltd)	Court of Appeal	Yes	[2021] 2 SLR 478	Singapore	Analysed the content of the test of insolvency.
EFT Holdings, Inc and another v Marinteknik Shipbuilders (S) Pte Ltd and another	N/A	Yes	[2014] 1 SLR 860	Singapore	It is open to me to presume that the test for insolvency in Cayman law is the same as it is in Singapore law
Re Stanford International Bank Ltd	English Court of Appeal	Yes	[2010] 3 WLR 941	England and Wales	For the purposes of Art 2(h), “law” includes both legislation and judge-made law.
In re HIH Casualty and General Insurance Ltd	N/A	Yes	[2008] 1 WLR 852	N/A	Modified universalism finds expression in the Model Law
Re Betcorp Limited (in liquidation)	Nevada United States Bankruptcy Court	Yes	400 BR 266	United States	The requirement that the foreign proceeding be “under a law related to insolvency or the adjustment of debts” does not require the company to be either insolvent or to be contemplating the adjustment of debt
Re ABC Learning Centres Ltd	N/A	Yes	445 BR 318	United States	The debtor company’s voluntary winding up in Australia was authorized and conducted pursuant to a law related to insolvency or the adjustment of debts.
Re Manley Toys Limited	N/A	Yes	580 BR 632	United States	The debtor company’s voluntary liquidation in Hong Kong was a “foreign proceeding” within the meaning of s 101(23) of Chapter 15.
Re Sturgeon Central Asia Balanced Fund (in liquidation) Carter v Bailey and another (as foreign representatives of Sturgeon Central Asia Balanced Fund Ltd)	English High Court	Yes	[2020] EWHC 123 (Ch)	England and Wales	The Model Law’s purpose and object is to recognize and provide relief in respect of proceedings involving companies which are insolvent or in severe financial distress.
Re Agrokor DD and in the matter of the Cross-Border Insolvency Regulations 2006	English High Court	Yes	[2017] All ER (D) 83 (Nov)	England and Wales	National courts should not slavishly follow the decisions of other countries’ courts where they are based on different adaptations of the Model Law or do not accord with the relevant preparatory materials
Re Pan Ocean Co Ltd, Fibria Cellulose S/A v Pan Ocean Co Ltd	N/A	Yes	[2014] EWHC 2124 (Ch)	England and Wales	The words “any appropriate relief” in art 21 were not to be construed in the way that authority indicated.
Re Petition of the Board of Directors of Hopewell International Insurance Ltd	NY United States Bankruptcy Court	Yes	238 BR 25	United States	Granted ancillary relief to a foreign solvent debtor that was undergoing a scheme of arrangement in Bermuda.
Re Chow Cho Poon (Private) Ltd	Supreme Court of New South Wales	Yes	(2011) 80 NSWLR 507	Australia	The whole of the winding up provisions in the Companies Act (2006 Rev Ed) are to be classified as “a law relating to insolvency”.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Insolvency, Restructuring and Dissolution Act 2018	Singapore
Companies Act (2021 Revision)	Cayman Islands

15. Key Terms and Keywords

15.1 Key Terms

Foreign proceeding
Insolvency
Solvent liquidation
Cross-border insolvency
Model Law
Third Schedule
Recognition
Liquidator

15.2 Keywords

Insolvency
Cross-border
Liquidation
Singapore
Cayman Islands
Foreign Proceeding
Recognition

17. Areas of Law

Area Name	Relevance Score
Insolvency Law	95
Recognition of foreign solvent liquidation proceedings	90
Recognition of foreign insolvency proceedings	90
Foreign Law	60
International Law	50
Company Law	40
Civil Procedure	30
Jurisdiction	30
Judgments and Orders	25

16. Subjects

Insolvency
Cross-Border Law
Company Law