LEUNG KA HO KIVEN v. The Joint and Several Trustees of the property of LEUNG KA HO KIVEN, a bankrupt

HCB 5946/2016

[2018] HKCFI 1249

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO 5946 OF 2016

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DECISION

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1.  The applicant was adjudged bankrupt in October 2016 upon his own petition. The trustees in bankruptcy of the estate of the bankrupt were appointed pursuant to the resolution of the general meeting of creditors held in January 2017. On 17 January 2018, the trustees notified the bankrupt in writing of their assessment of his monthly income and expenses. A net monthly balance of HK$7,204 was requested to remain in his estate for the trustees’ administration [1].

2.  The applicant applies to reverse such decision of the trustees pursuant to section 82 of the Bankruptcy Ordinance, Cap 6. Specifically, he takes issue as to the allowance made by the trustees in respect of the maintenance of his children (aged 18 and 14 respectively) and father (aged 65) in their assessment.

3.  Section 82 provides that subject to the ordinance, the trustee shall use his discretion in the management of the estate and its distribution among the creditors.  Section 83 provides that in an appeal against the decision of the trustee, the court is exercising its discretion.  On this basis, it becomes the burden of the bankrupt to satisfy the court that the decision of the trustee ought to be reversed or varied. That any other person or indeed the court may take a different view of the matter per se does not suffice to justify interference with the decision of the trustee lightly.  The court expects to be satisfied that the trustee has erred in principle, including falling out of line of proper exercise of his discretion reasonably expected in the circumstances of this case, before reversing the trustee’s decision.

4.  In the course of his oral submission, the bankrupt was at the verge of referring to various matters not covered by the affidavit evidence [2].  Upon explanation, the bankrupt decided to proceed without seeking leave to file further evidence for his purpose.

5.  Whilst the bankrupt’s monthly income as a civil servant is HK$30,072, he projected a monthly expenses of HK$35,771.  Upon investigation, the trustees assessed the reasonable monthly expenses to be shouldered up by the bankrupt to be HK$22,868, and thus leaving a net balance that should remain in the bankrupt’s estate under the trustees’ administration.

6.  The trustees allowed children’s expenses, inclusive of education, in the sum of HK$8,000 per month.  An additional sum of HK$3,500 was allowed for the expenses for the elder son.  The maintenance of the father was allowed at HK$2,000, whilst the amount claimed was HK$8,000.  Nowthe bankrupt seeks further allowance for the children’s travelling and privatetuition expenses in the sums of HK$1,650 and HK$1,250 respectively.  He also seeks an increase of the allowance for the father by HK$1,000.

7.  The trustees have considered the fact that the bankrupt’s familyresides at rented quarter.  Additional expenses of the elder son’s university education have been taken into account. His wife is working and earns a salary of HK$16,000, and is reasonably expected to support her personal expenses and, if the allowed sums for the children become insufficient, part of the expenses of the children.  Maintenance of his father ought to be a shared burden amongst himself and his two sisters.  This is not unreasonable, quite irrespective of whether any inference may be drawn from the trustees’ suggestion that the sisters have claimed parents’ dependency allowance for taxation purpose (which the bankrupt indeed disputed).  The trustees mentioned the possibility of application for old age living allowance, but that would really be subject to test of eligibility.  So I would say no more about its possible relevance in the balancing exercise.

8.  The bankrupt has failed to show, either by evidence or his representation to the court, that the trustees have erred or failed to properly exercise their discretion in the circumstances of the case. I therefore see no valid basis for interfering with their decision.

9.  The application is dismissed.  The trustees indicated that no costs would be sought.  I accordingly make no order as to costs.