The court's power to appoint provisional liquidators to carry out rescue roles: Rethinking Legend

A dictum in a 2006 Hong Kong Court of Appeal decision had since halted the use of provisional liquidation as a restructuring device in Hong Kong, where no purpose-built moratorium is provided, until recently, where the Court of First Instance reaffirmed the role of provisional liquidation in restructuring. The Court of First Instance (CFI) judges did so without appearing to contradict the Court of Appeal (CA) position by reconstructing the CA dictum. This paper argues that the CA dictum does not make sense in the first place and pointing out why this is so is more helpful in clarifying the governing rule than a reconstruction of CA's words, which may mislead.