CHRISTIAN EMIL TOGGENBURGER AND OTHERS v. LUU, HUNG VIET DERRICK AND OTHERS

CACV 218/2012

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 218 OF 2012

(ON APPEAL FROM HCA NO. 815 OF 2009)

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Hon Barma JA (giving the Reasons for Decision of the Court):

1. On 6 September 2013, we gave judgment in this matter, allowing in part an appeal by Mr Christian Emil Toggenburger against the judgment of Chung J dated 31 July 2012, concluding that one of the two claims by him against Mr Luu Hung Viet Derrick was (contrary to the judge’s decision) well founded, and ordering that judgment be entered for Mr Toggenburger against Mr Luu for HK$38,702,670.40, with questions of interest and costs to be dealt subsequently.

2. As we noted in paragraph 6 of our judgment, Mr Luu was made bankrupt (on the petition of another of his creditors) on 8 February 2012, shortly after the trial concluded.  The consequence was that his rights in relation to these proceedings formed part of his estate in bankruptcy and accordingly fell to be dealt with by his Trustees in Bankruptcy, who informed us that they had considered the position and did not wish to participate in the appeal.

3. After our judgment was handed down, Mr Luu (acting in person) sought (on 3 October 2013) to make an application for leave to appeal against our judgment to the Court of Final Appeal.  On 17 October 2013, his Trustees in Bankruptcy informed the Court of their view that he had no locus to do so without their consent, and that they would not consent to his making any such application without a full and effective indemnity being provided to them in respect of the costs thereof (including any adverse costs orders that might be made).  No such indemnity appears to have been made available thereafter.  In consequence, on 19 November 2013, Barma JA directed that no date should be fixed in respect of the application, as Mr Luu had no locus in respect of the proposed application, his rights in respect of the proceedings and appeal being vested in his Trustees in Bankruptcy, who had not consented to or authorised the proposed application.  By these Reasons for Decision, we explain why that direction was given.

4. In essence, the reasons are the same as those which meant that Mr Luu could not be heard personally on the appeal proper.  As the proceedings at first instance and the appeal concerned Mr Luu’s property, which vested upon his bankruptcy in his Trustees in Bankruptcy, the conduct of the proceedings and any appeals therefrom (including any possible further appeal to the Court of Final Appeal) likewise vested in his Trustees (see Quinn v Irish Bank Resolution Corporation Ltd [2012] IEHC 261).  This approach has also been adopted in Hong Kong (see Phoon Lee Piling Co Ltd v Hong Kong Housing Authority [2004] HKEC 1221), in which it was made clear that where a bankrupt wished to pursue an appeal which his trustee was unwilling to pursue, he could only be permitted to do so on condition of providing an adequate indemnity to his trustee and his estate in bankruptcy, which might otherwise be burdened with an adverse costs order in respect of an unsuccessful appeal.

5. As, in the present case, the Trustees in Bankruptcy did not agree to Mr Luu’s proposed application being made, and he has not sought to provide them with the necessary indemnity, the application was made without proper standing, and was accordingly not allowed to proceed.