Under section 254(1)(i) of the Companies Act (Cap 50, 2006 Rev Ed), the court may order the winding up of a company where misconduct by the company’s director creates a “justifiable loss of confidence” in his/her management of the company. However, even if such a ground for winding up is established, the court retains “residual discretion” to decline to grant such an order. In Douglas Foo Peow Yong v ERC Prime II Pte Ltd [2018] SGCA 67, the Court of Appeal discussed when such justifiable loss of confidence might occur, and how the courts should exercise their residual discretion.
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