Bona fide dispute over claim maturity should be litigated in a regular suit; winding up hearings may be deferred accordingly.

Where a company raises a bona fide, substantial dispute as to the maturity or payability of a creditor's claim under a scheme, the winding up court should not finally decide complex construction issues on the petition; instead it may examine whether the dispute is bona fide but ordinarily defer substantive construction to a regular suit. Proof of insolvency remains the basis for winding up, and if resolution of the construction question is determinative of insolvency the matter may be litigated in the appropriate Original Side suit. The appeal's further hearing is to be adjourned pending determination of that suit and the petition not finally disposed of now.

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Issues: Whether, in proceedings for a winding-up petition where the company raises a bona fide dispute as to the maturity/payability of the creditor's claim under a scheme, the winding-up court should decide the dispute on the petition or defer determination pending a suit for construction of the scheme, and whether further hearing of the appeal should be adjourned pending decision of that suit.

Analysis: The court examined the legal framework governing winding-up on the ground of inability to pay debts, observing that the basis of a winding-up order is proof of insolvency. It considered established practice that a petition is not a legitimate means to enforce a debt genuinely disputed by the company and that where a dispute as to liability is bona fide and substantial, the winding-up court will ordinarily either dismiss the petition or keep it pending until the creditor establishes the claim in a regular action. The court analysed authority relied upon by the appellant and concluded that such authority permits the winding-up court to examine whether the dispute is bona fide and substantially grounded but does not obligate the court to decide complex questions of construction on the petition where substantial construction issues exist. The court further observed that where the company's contention, if decided against it, would leave the company unable to pay without selling capital assets, the question of insolvency is implicated; nevertheless, convenience and practice favour having the construction issue determined in a regular suit already pending on the Original Side.

Conclusion: The court directed that the further hearing of the appeal be adjourned and stand over until after the decision of the suit pending on the Original Side to determine the construction of the scheme; the winding-up petition is not to be finally determined on the present petition pending that decision.

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