RE MICHAEL HEATH NATHAN JOHNSON

IN THE SUPREME COURT OF HONG KONG

IN BANKRUPTCY

NO. B932 OF 1995

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DECISION

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1. This is an application to rescind a Receiving Order. The petition states that the Debtor within a year before the date of the presentation of this petition has ordinarily resided in Hong Kong or had a dwelling house in Hong Kong. The petition was presented on the 6th January 1996. Neither the Official Receiver nor the Petitioner can bring before this court any evidence to contradict what is now the clear evidence that the Debtor left Hong Kong in 1993 and was only in Hong Kong for a short period of five days in 1995.

2. It is clear from the evidence now filed by the Official Receiver in his report dated the 9th July that the Debtor was not ordinarily resident in Hong Kong for a year before the presentation of the petition, nor is there any indication that he had a house in Hong Kong. This petition is therefore falsely based and the Receiving Order must be set aside.

3. If the Petitioner wishes to present a further petition based on other premises that is a matter for the Petitioner. However, I have been told by counsel on behalf of the Applicant that the Applicant, the Debtor, is perfectly willing to pay the debt, and he was unaware of these bankruptcy proceedings, and he objects to the stigma of a Receiving Order having been made. I consider that he has justly come to this court and he should not labour under the burden of the Receiving Order any longer, and I therefore set it aside.

4. In doing so I must mention this, that it has come to my attention on perusing this file that a report was filed on behalf of the Official Receiver on the 19th April 1996 in which it is stated quite boldly..." The Debtor has absconded." From the Official Receiver's Report filed for the purposes of this hearing it is clear that this needs to be investigated. The importance which this court attaches to the accuracy of the Official Receiver's reports cannot be underestimated. The word 'abscond' means to hide, or to leave hurriedly, or secretly, and to flee from justice. It has clear connotations and meaning. If there was no basis for using that word, that word should not have been used in the report, and I require the person who made that report to appear before me within 14 days to explain how that came to be said, and I require this matter to be drawn to the personal attention of the Official Receiver.

5. I am going to order that the costs of the Official Receiver and the Applicant be paid by the petitioning Creditor. It may well be that, under contractual provisions with the bank, the bank might be able to claim from the Applicant, but as far as these proceedings are concerned, the petition was inaccurate, the Receiving Order had to be discharged and the adjudication annulled and costs must follow the event.