SONIA YAU AND ANOTHER v. LAU MING YIN

HCMP 258/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 258 OF 2009

(ON AN INTENDED APPEAL FROM HCCW NO. 16 OF 2002)

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DECISION

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Introduction

1.  Mr Lau Ming Yin (“Mr Lau”), was a director of Kam Kuen Construction Company Limited (“the Company”) which is in liquidation, holding HK$9,980,000, out of 10 million issued shares.  Mr Lau was also a director of Kam Kuen Engineering Limited (“KKE”).  By a deed of assignment dated 10 December 2001 (“the deed”) made between the Company as assignor, KKE as assignee, and Mr Lau as debtor, the Company assigned a debt of HK$7,262,042.69 owed by Mr Lau to the Company in return for the satisfaction and settlement of the debt in the sum equivalent to that of the debt due from the Company to the assignee.

2.  In proceedings brought by the liquidators of the Company, (the liquidators) under sections 266 and 266B of the Companies Ordinance, Cap. 32, the deed was declared by Kwan J on 7 December 2007 to be void because a case of unfair preference was made out.  By the same judgment, she also ordered Mr Lau to pay the Company the sum of HK$7,262,042.69.

3.  By summons dated 13 February 2009, Mr Lau applied for an extension of time to appeal the order of Kwan J.  What prompted the application is the bankruptcy petition issued by the liquidators on 18 November 2008.  On 21 January 2009, Mr Lau informed the court that the petition was opposed.  The hearing of the petition was adjourned until 2 February 2009, subsequently, to 23 February 2009 before a bankruptcy judge.  The present summons for extension of time to appeal was issued on 13 February 2009.

4.  Mr Lau acted in person.  His application was supported by his affirmation dated 13 February 2009.  In his affirmation he claimed that he had not received “any court summons”.

Service

5.  By an originating summons issued on 10 July 2006 (the return date was 2 August 2006), the liquidators claimed as against Mr Lau, for, inter alia, a declaration that the deed is void and for payment of the sum of HK$7,262,042.69.  The originating summons required personal service.  However, under O. 10 r. 1(3) of the Rules of the High Court, the originating summons might be served by registered post, and if so served,

“… the date of service shall … be deemed to be the seventh day … after the date on which the copy was sent to … the address in question.”

6.  On 11 July 2006, the liquidator’s solicitor arranged for the Summons and supporting documents (‘the documents’) to be served on Mr Lau by registered post.

7.  On 18 July 2006, the liquidators were informed by the post office that the documents had been collected from the post office on 17 July 2006.

8.  Ms Lui of the liquidators’ solicitors, Messrs. Laracy Gall, has said on affidavit that the documents had not been returned to her at her office.

9.  Service of the originating summons was deemed to have been effected on 18 July 2006.

10.  Mr Lau failed to attend Court on 2 August 2006. The matter was adjourned to a date to be fixed.

11.  On 4 August 2006, Mr Lau, was notified by letter that the liquidators’ solicitor would attend at Court and fix a date for the adjourned hearing.

12.  On 14 August 2006, Mr Lau was again notified by letter that the hearing of this matter had been fixed for hearing before Kwan J on 20 October 2006 at 10.00 am.

13.  The letter of notification of the fixed hearing date was delivered to Mr Lau’s address on 16 August 2006.

14.  Ms Chan of Laracy Gall has said on affirmation that on 22 October 2007, she served by registered post a letter informing Mr Lau that they were to attend the office of the deputy clerk of court for the purpose of fixing a date for the adjourned hearing, and that the registered letter was delivered 22 October 2007.

15.  Ms Chan also said on affirmation that on 2 November 2007 that she served a letter by registered post on Mr Lau informing him that the hearing date had been fixed for 7 December 2007 at 9.30 am, along with other supporting documents, and that these documents were delivered on 14 November 2007.

16.  This is what Kwan J said in her judgment:

“3.    The summons had come before the court on 2 August 2006 and 20 October 2006.  The respondent was absent on previous occasions.  He is also absent today.  I am satisfied from the affirmations of service that the papers have been properly served on him at his last known address.  I noted that on one occasion the documents delivered by courier were received by a person who identified herself as his daughter.  The respondent has not filed any evidence or indicated his position to the application.  I have decided to proceed in his absence.”

17.  Kwan J then made the orders sought.

18.  In Mr Lau’s affirmation dated 13 February 2009, he said:

“… 但為了避免被債權人發現，我於2005年5月後直到現在多住在深圳避開債權人 …”

(To avoid by creditors locating me, I live mostly in Shenzhen since May 2005)

19.  He gave us his address in that affirmation “Flat H, 12^th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon.”

20.  The important issue before me is whether Mr Lau was in Hong Kong in July, in particular, on 17 July 2006 and 18 July 2006.  17 July 2006 could be the relevant date if he had collected the registered parcel on that date.  Deng Minghui v Chau Shuk Ling [2007] 1 HKLRD 905. 

21.  At the hearing before me on 25 February 2009, I asked Mr Lau whether he was in Hong Kong in July 2006, and who collected the registered parcel on 17 July 2006.  He told me that it was his ex-girlfriend （杜少媚） with whom he has a daughter, who collected the registered parcel.  I then adjourned the matter to enable Mr Lau to say on oath whether he was in Hong Kong at the relevant time, as well as to enable him if he so wished to ask his ex-girlfriend to make an affirmation on his behalf.  Mr Lau has filed an affirmation dated 2 March 2009, in which he said he had separated from his girlfriend since May 2005 and he had moved to Shenzhen but that:

“… 在此期間我每月都有返港 3 – 5 次，間中有時在港逗留過夜 1 – 2 天，亦住在三家姐劉倩在屯門家裡，或住公寓或朋友家，沒有回滙景家住。直至2008年7月我被禁止出境，我才長期留在香港，並取回寄到我住址滙景花園的全部信件。我找人翻譯細看後，才知道事態非常嚴重。於是到法院申請上訴。”

22.  Briefly stated, Mr Lau’s evidence is that he returned to Hong Kong 3 to 5 times a month, during which sometimes he would stay 1 or 2 days.  He claimed that it was after July 2008, when he could not leave Hong Kong that he had collected all the correspondence from Sceneway Garden.

23.  It is not clear where he claimed to have been living since his return to Hong Kong in July 2008, but I note that in his affirmation of 2 March 2009, he gave the same Sceneway Garden address. 

24.  By an affirmation dated 2 March 2009, 杜少媚 (To Siu Mei) made an affirmation on behalf of the respondent.  In that affirmation, she claimed that she rented the Sceneway Garden flat in her own name,

“… 但劉銘然沒有支付租金、押金、搬屋費，全部都是由我支付，后來又因他沒有支付女兒零用錢，又一直沒有家用給我而反面。自始約2005年5月他獨自搬去深圳住，就一直沒有回來，我自己依靠做汽車經紀攢取中介服務費生活，我每次收到劉銘然的信件，文件都放在家裡存起來，等他有機會到來取，2008年7月他才全部取走。”

As I understand it, she said that every time she received correspondence for Mr Lau she would keep them at home to await his collection, in July 2008 he took away all the correspondence.  She said nothing about collecting the registered parcel on 17 July 2008.

25.  She also gave the Sceneway Garden address as her address when she made her affirmation. 

26.  Neither affirmation disclosed the identity of the person who collected the registered parcel on 17 July 2006. 

27.  Nor is there any clear statement from Mr Lau whether he was in Hong Kong on 17 or 18 July 2006. 

28.  When leave was given to Mr Lau to file further evidence, the liquidators were given leave to submit evidence in response.  The liquidators have supplied searches from the Companies Registry and submitted:

“(i)   The Annual Return for ‘Wah Kwong Creation Holdings Limited’, dated 8 July 2006, shows that its Registered Office is at Flat H, 12^th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon.

(ii)    The Applicant and To Sui Mei, who deposed to To, are both shown to be ordinary share holders, and their address is Flat H, 12th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon.

(iii)   The Applicant also says that he is the Secretary and Director. He gives his address as Flat H, 12th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon.

(iv)   To Siu Mei also says that she is a Director, and that her address is Flat H, 12^th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon.

(v)    The Annual Return is signed by the Applicant and dated 8 July 2006, just 10 days before service of the Summons.

(vi)   For the company ‘Hong Kong Tack Fat Investments Company Limited’, the Applicant is shown as a Director and his residential address is shown as Flat H, 12^th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon, with effect from 26 April 2008.

(vii)  In the Annual Return dated 26 April 2008, the Applicant says that he is a Member and that his address is Flat H, 12^th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon.

7. In the circumstances, we say that at the time of service, 18 July 2006, the Applicant was indeed resident in Hong Kong at Flat H, 12th Floor, Block 10, Sceneway Garden, Lam Tin, Kwun Tong, Kowloon.

8. There is no evidence to show that on the day of service, the Applicant was not in Hong Kong.”

29.  On such evidence, I am not satisfied that Mr Lau was not in Hong Kong on 17 or 18 July 2006.

Defence

30.  I turn to consider the respondent’s claim that that he has a defence to the claim.  I agree with Mr Sherry, counsel for the liquidators that even if time to appeal is extended, the appeal itself has no real chance of succeeding.  Mr Lau’s defence that the judgment sum was investment money of the Company which was incorrectly recorded in his name is not credible.  I have already referred to the deed.  He confirmed to me that he signed the assignment to me three times.  First, as one of the directors of the Company, then as a director of the assignee, and finally as the debtor. 

Delay

31.  There has been substantial delay for which there has been no reasonable excuse.

Conclusion

32.  So in all the circumstances of this case, I do not believe it would be right to extend time for leave to appeal and I therefore dismiss the application accordingly.  I also make an order that the liquidators are to have the costs of this application to be taxed if not agreed.