A hopeless application to lift a stay of proceedings against a Bermuda company in liquidation in Singapore

In his recent judgment in the case of Re Celestial Nutrifoods Limited (in Liquidation) [2017] SC Bda 10 Civ (31 January 2017), Chief Justice Kawaley of the Supreme Court of Bermuda has dismissed an application made on behalf of two former directors of the company to lift a stay of proceedings against the company (arising out of the fact of its liquidation in Singapore), with a view to allowing the directors to bring proceedings against the company in Bermuda, (a) to assert substantive claims for indemnity under its Bye-Laws, and (b) to apply for anti-suit injunctions and associated declarations against the company and its liquidators, restraining them from proceeding with pending proceedings against the directors in Singapore.

The judgment is of some interest in its review of certain legal principles relating to international insolvency co-operation in Bermuda, as well as its discussion of the Court’s power(s) to stay legal proceedings for one reason or another, but ultimately the decision appears to have turned on the very stark facts of the case (including the directors’ inordinate delay in making the application, against the background of well-advanced litigation raising the very same issues for determination before the Singapore courts, to whose jurisdiction the directors had submitted without challenge).

One of the oddities in the case is that Bermuda Counsel for the directors (Mr. Jan Woloniecki of ASW Law) is also recorded in Chief Justice Kawaley’s judgment as having been instructed by one of the directors to give expert opinion evidence on his behalf on issues of Bermuda law before the Singapore High Court.

It will be interesting to see whether Mr. Woloniecki’s opinions are challenged, in due course, on the basis of his apparent lack of independence, or on the basis of his inability to persuade the Supreme Court of Bermuda of the merits of his client’s application …



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