RE GOH MING WOEI

HCB 1400/2013

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO. 1400 OF 2013

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J U D G M E N T

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1. By a Petition dated 28 February 2013, which was re-amended on 5 September 2013, the petitioner seeks a bankruptcy order against Mr Goh Ming Woei (“Debtor”).

2. The Petition is based on a judgment debt (“Judgment Debt”) in HCA 1609/2008 (“Action”).  Judgment in the Action was given on 20 February 2012 against the Debtor and one JFK Holding Co Ltd for the sum of HK$3.4 million plus interest.  The Debtor’s appeal against that judgment in CACV 53/2012 was dismissed as a consequence of his failure to provide security for costs as ordered by the Court.

3. A statutory demand in respect of the Judgment Debt (“Statutory Demand”) was served on the Debtor by way of advertisement on a newspaper published on 1 November 2012 pursuant to Rule 46(3) of the Bankruptcy Rules, Cap 6A.  However, the Debtor has failed to satisfy any part of the Judgment Debt.

4. The petitioner’s evidence, which is not disputed, is that it has no knowledge of any asset of the Debtor in Hong Kong against which the Judgment Debt can be enforced.  The petitioner therefore had no choice but to present the Petition. 

5. With the leave of Master Ho dated 4 February 2013, the Petition was filed on 28 February 2013.  It was then duly served on the Debtor by way of substituted service.

6. In his Notice of Intention to Oppose Petition (“Notice”), the Debtor raised 5 challenges against the Petition.  However, quite sensibly, only the first challenge was advanced at the hearing by Mr Li, who appeared on behalf of the Debtor.  The concession was rightly made. I am quite satisfied there is no merit whatsoever in any of the other challenges. 

7. The remaining challenge concerns the jurisdiction of the court – whether the Debtor is amenable to bankruptcy proceedings in Hong Kong.  The jurisdiction in question is governed by s 4(1) of the Bankruptcy Ordinance, Cap 6 (“Ordinance”):

“(1) A bankruptcy petition shall not be presented to the court under section 3(1)(a) or (b) unless the debtor-

(a) is domiciled in Hong Kong;

(b) is personally present in Hong Kong on the day on which the petition is presented; or

(c) at any time in the period of 3 years ending with that day-

(i)  has been ordinarily resident, or has had a place of residence, in Hong Kong; or

(ii)  has carried on business in Hong Kong.”

8. There are three limbs to the jurisdictional challenge based on s 4(1)(b) and (c)(i), namely (1) whether the Debtor was in Hong Kong on the 28 February 2013; (2) whether the Debtor has been ordinarily resident in Hong Kong at any time in the period of 3 years ending with the date of presentation of the Petition (the relevant period being 28 February 2010 to 28 February 2013 (“Relevant Period”)); and (3) whether the Debtor has had a place of residence in Hong Kong at any time during the Relevant Period.

Law

9. The applicable legal principles are not controversial.

Ordinary residence

10. The test of ordinary residence has been set out in Re Wong Lei Kwan Joanne, ex p Bank of China (Hong Kong) Ltd [2009] 3 HKLRD 173, §16:

“(1) Ordinary residen[ce] is not a term of art in English law.

(2) In their natural and ordinary meaning the word ‘ordinary resident’ mean ‘that the person must be habitually and normally resident here, apart from temporary or occasional absences of long or short duration’. The significance of the adverb ‘habitually’ is that it recalls 2 necessary features mentioned by Viscount Summer in Lysaght, namely residence adopted voluntarily and for settled purpose.

(3) The decision in each of the decided cases depended upon its own particular facts …

(4) A person could be ordinarily resident in two countries at the same time …

(5) Unless it can be shown that the statutory framework or the legal context in which the words are used required a different meaning, ‘ordinarily resident’ refers to a man’s abode in a particular place or country which he has adopted voluntarily and for settled purposes as part of the regular order of his life for the time being, whether of short or long duration.

…

(7) There are two, and no more than two, respects in which the mind of the person is important in determining ordinary residence. The residence must be voluntarily adopted. Enforced presence … may be so overwhelming a factor as to negative the view [sic] to be where one is. There must be a degree of settled purpose. … All that is necessary is that the purpose of living where one does has sufficient degree of continuity to be properly described as settled.

(8) The legal advantage of adopting the natural and ordinary meaning is that it results in the proof of ordinary residence which is ultimately a question of fact depending more upon the evidence of matters susceptible of objective proof than upon evidence as to state of mind. If there can be proved a regular, habitual mode of life in a particular place, the continuity of which has persisted despite temporary absences, ordinary residence is established provided only it is adopted voluntarily and for a settled purpose.

(9)  The ‘real home’ test is wholly inconsistent with the natural and ordinary meaning of the words as construed by the House of Lords in the two tax cases, it is an unhappy echo of domicile …”

Place of residence

11. The meaning of the 2^nd limb of s 4(1)(c)(i) was considered in Re Ku Chu Keung (a debtor) [2006] HKCLRT 171.  It was held in §52:

“… if a person has a house or lodging in Hong Kong to which he can return, and he occupies or intends to occupy the place as a place of residence, then he has a place of residence in Hong Kong. … Furthermore, a person may have more than one place of residence at the same time.”

The evidence

12. The Debtor’s evidence is that he is a Malaysian national.  He was born and is domiciled in Malaysia.  Hong Kong is one of many places he visits by reason of his employment.  He has a permit to work in Hong Kong.  The Debtor maintains that his principle place of business is in Malaysia and it is where he permanently stations.  He is required to travel frequently due to the need to meet with overseas clients.  Once his meetings are concluded, he will return to Malaysia.

13. In respect of an apartment in Sai Kung, New Territories (“Premises”), which the petitioner says is the Debtor’s place of residence in Hong Kong, the Debtor maintains that it is a staff quarters provided by his employer.  However, anyone of his colleagues can use the Premises when he/she is in Hong Kong.  In other words, the Premises are not for his exclusive use.  In any case, the Debtor has not used the Premises for the last 3 years because there are other quarters available to him. 

14. The Debtor also says that he has no real connection with Hong Kong.  His visits here are strictly limited to work purposes. 

15. To contradict the Debtor’s case, Ms Ho, who appeared for the petitioner, relies upon a wealth of evidence, much of which has emanated from the Debtor himself.

16. Firstly, it is the Debtor’s evidence given on affirmation that he has been ordinarily residing in Hong Kong during the Relevant Period:

(1) In his affirmation dated 30 August 2012 and filed in CACV 53/2012 in opposition to an application for security for costs, the Debtor stated that:

(a)  “I have a Hong Kong identity card and am a resident in Hong Kong ” (§22);

(b)  “I am married for 5 years and am living in Hong Kong with my wife who is a housewife and daughter … in a rented property [the Premises].  We have been living in [the Premises] for over 3 years like a matrimonial home” (§23);

(c)  “I and a partner carry on a business … based in Hong Kong … Most of the transactions are concluded in Hong Kong …” (§24);

(d)  “I had to travel abroad but only for business purposes and would not be away from Hong Kong for more than 10 days in a single business trip … I only stay abroad for a short period of time for business purposes, and my permanent resident is in Hong Kong at all times” (§25);

(e)  “Despite of (sic) my business travels, I do have a strong family ties in Hong Kong and close business connection in this jurisdiction” (§26).

(2) In another affirmation dated 30 August 2012 in support of the Debtor’s application for stay of execution pending appeal, the same evidence was repeated:

“I have a Hong Kong identity card and am a resident in Hong Kong. I am married for 5 years and am living in Hong Kong with my wife who is a housewife and daughter … in a rented property [the Premises]. We have been living in [the Premises] for over 3 years like a matrimonial home” (§24).

(3) The address of the Debtor stated in both of the above affirmations is that of the Premises.

17. Secondly, the fact that the Debtor ordinarily resides in Hong Kong is further demonstrated by the following evidence:

(1) During the trial of the Action, upon the request of the court, the Debtor provided the address of the Premises as his address for service in Hong Kong.

(2) When Mr Dominic Wong of the petitioner’s solicitors (“Wong”) attended the Premises to serve the Statutory Demand on the Debtor on 1 June 2012, a female who identified herself as the Debtor’s wife answered the door and told Wong that the Debtor would return in a few days.

(3) When Wong attended the Premises again on 4 July 2012, a female who identified herself as a domestic helper answered the door.  She said that the Debtor was away but she gave a call to him at Wong’s request.  Wong then had a conversation with the Debtor over the phone, albeit that the latter sought to disguise his identity by claiming that his surname was Lam.

(4) The Debtor’s passport shows that he obtained a Hong Kong employment permit in 2009.  The permit was extended in 2011 and was due to expire on 28 February 2013.

Determination on ordinary residence

18. Ms Ho is plainly correct to have submitted that there is overwhelming evidence that the Debtor has been ordinarily resident in Hong Kong during the Relevant Period.  In all probability, he remains so to date.

19. One cannot exclude the possibility that Malaysia may also be a place of ordinary residence for the Debtor.  However, such possibility does not prevent him from ordinarily residing in Hong Kong.  The law recognises that a person can have more than one place of ordinary residence at a time.

Determination on place of residence

20. Again, the evidence is overwhelming.  The Debtor has been residing at the Premises with his family and a domestic helper.  The requirements under the 2^nd limb of s 4(1)(c)(i) of the Ordinance have been met. 

Presence in Hong Kong

21. First of all, the burden of proof must be on the petitioner given that this is a matter which goes to the jurisdiction of the court.  However, I do not believe that it is a heavy burden to discharge.  In most cases, it is a matter of inference.  Most cases would involve a Hong Kong person living here.  Absent any contrary indication, it can normally be inferred or assumed that such a person was in Hong Kong on the day the petition was presented. 

22. Mr Li has submitted that the petitioner has failed to proffer any evidence to support its case in this regard.  Instead, it is relying upon a bare assertion.  I am unable to see any merits in the Debtor’s case.  As I have decided above, he ordinarily resides in Hong Kong (certainly during the Relevant Period).  There is nothing to suggest that he was absent from the Region on the 28 February 2013.  If that were the case, it would have been very easy for the Debtor to adduce evidence to that effect.  There is no such evidence.  The court is entitled to consider the totality of the evidence before it.  There is no reason to doubt that the Debtor was in Hong Kong on the day the Petition was presented.

23. In the premises, each one of the jurisdictional challenges has failed.

Abuse of process

24. I regret to say that the material before the court has demonstrated that the Debtor is a thoroughly dishonourable person who would not hesitate to lie to the court to advance his case.

25. In the trial of the Action before Mr Justice Chung, the Debtor was found to be an untruthful witness and his testimony was rejected (Great Bill Ltd v JFK Holding Co Ltd & Anr,HCA 1609/2008, unrep, 20 February 2012, §13).

26. In the security for costs application before the Court of Appeal (Great Bill Ltd v JFK Holding Co Ltd & Anr,CACV 53/2012, unrep, 13 September 2012), it was held by Mr Justice Fok JA in §13:

“After the writ was issued in the action but before judgment was entered, it would appear that the [Debtor] transferred shares in his name in JFK Holding Company Limited to a third party, who has the same surname as him and who may or may not be a relative. A property owned by that company was sold to another company, Elite Group Holding (HK) Company Limited, in which the [Debtor] had shares but a company search shows he transferred those shares to two third parties after the writ in the action was issued. I am satisfied that these transfers support an inference that the [Debtor] was seeking to make it difficult for the [Petitioner] to find assets of his against which to execute any judgment.”

27. As observed above, the Judgment Debt remains wholly unsatisfied.

28. Instead of meeting his obligations, the Debtor has sought to resist this Petition with a wholly unmeritorious case premised upon falsities designed to mislead the court.

29. After the CJR, litigants are required to verify the truthfulness of their pleadings.  What the Debtor has done flies in the face of the current ethos and the court cannot be expected to overlook such behaviour. 

30. The Debtor’s conduct constitutes an abuse of these proceedings.  Had there not been a challenge on jurisdictional ground, this court may have considered striking out the Notice together with the Debtor’s evidence, and proceed to make a bankruptcy order against him.

Conclusions

31. I make the usual bankruptcy order against the Debtor, save that I make an order nisi that costs are awarded on an indemnity basis in light of the abuse of process.

32. Last but not least, I am grateful to counsel for their assistance in these matters.