RE TO YUK FUNG

HCB 6667/2019

[2020] HKCFI 2134

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO 6667 OF 2019

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J U D G M E N T

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1.  This is the court’s judgment on the bankruptcy petition in these proceedings. The petition was originally scheduled to be heard on 27 July 2020. Having regard to public health considerations arising from the pandemic, the parties have agreed for the petition to be determined on the basis of written submissions. This court having come to a conclusion, as these are proceedings on a bankruptcy petition, the matter is listed for hearing before me again, so that the court can pronounce its order, sitting in open court.

2.  The petition was presented by Elegant Mark Investment Ltd (“Elegant”) for the bankruptcy of Madam To Yuk Fung (“Mdm To”), based on a debt said to be owed under a loan agreement written in Chinese and dated 30 September 2013 (“Loan Agreement”).  Elegant was a licensed money lender at the time, though it ceased to be such in around May 2019.

3.  It is not in dispute that Mdm To signed the Loan Agreement with Elegant, with the following principal terms:

(1) Elegant agreed to provide a loan to Mdm To in the sum of $20,859,000. 

(2) The term of the loan was half a year, up to 31 March 2014.

(3) Interest would accrue on the amount outstanding: (i) in relation to the first tranche of $17,375,000, at 12% p.a., and (ii) in relation to the remainder of $3,484,000, at 24% p.a.  Interest was to be paid on the 30^th day of each month.

4.  There is no dispute that a statutory demand was served on Mdm To on 20 October 2015.  The Petition herein, asserting the debt, was presented on 30 October 2019 and verified by an affirmation of Mr Ng Kwok Wai (“KW Ng”), the loan officer of Elegant, on 3 January 2020.[1]

5.  On 13 December 2019, Mdm To filed her affirmation in opposition to the petition in which she denied being indebted to Elegant at all.  Her case, as stated in that affirmation, is as follows:

(1) Mdm To knew and had business dealings with Mr Ng Kwok Fai (“KF Ng”), the elder brother of KW Ng.  Mdm To met KF Ng in July 2011. 

The KD Project and Brampton Project

(2) In mid‑2012, KF Ng invested $15 million in each of two projects that Mdm To was pursuing in Papua New Guinea, by acquiring the beneficial ownership of 20% in each of (i) I‑Sky Property Development (PNG) Ltd in relation to a property development project called the “Brampton Project”; and (ii) I‑Sky Resources Development (PNG) Ltd in relation to a forestry project called the “KD Project”.  In each case the shares remained held by Mdm To for and on behalf of KF Ng.

(3) In about July 2013, at KF Ng’s request Mdm To agreed to lend her 80% interest in the Brampton Project to him with his 20% interest in the KD Project as collateral.  In this way, KF Ng could obtain a loan with the 100% interest in the Brampton Project as security.

(4) At the end of 2014, KF Ng asked Mdm To to buy back his 20% interest in the KD Project at his original buying price of $15 million.  Although she was not obliged and did not have sufficient cash to buy back his interest, due to their good relationship she started paying down‑payments or deposits of the buyback price to KF Ng on an irregular basis from February 2015 onwards.  These payments were made to Elegant’s account with the knowledge of KF Ng, and totalled $3,695,440.  KF Ng, however, still holds his 20% interest in the KD Project.

Profit Grand

(5) Separately, Mdm To had held an 85% interest in Profit Grand Enterprises Ltd (“Profit Grand”) which owned the KD Project.  The other 15% was held by two individuals that she called the “Kong Brothers”.  By a conditional agreement dated 2 December 2011, the two corporate vehicles (Able Famous Ltd and Peak Sino Ltd) that Mdm To used to hold shares in Profit Grand agreed to sell, and Century Praise Ltd, a subsidiary of Pacific Plywood Holdings Ltd (“Pacific Plywood”) which was a listed company of which KF Ng was chairman, agreed to purchase, 30% of the issued shares of Profit Grand at a consideration of $310 million. 

(6) In around June 2012, the Kong Brothers transferred their interest in Profit Grand to Mdm To for $30 million.  In order to raise that sum, Mdm To borrowed $5 million from KF Ng on 24 May 2012, interest‑free and without a fixed tenor.  Mdm To had since about October 2013 been making repayment of the $5 million loan to KF Ng from time to time.  The instalments paid were initially $243,180, but since KF Ng was upset about the failure of the acquisition of the 30% interest in Profit Grand in May 2014 (see below), she increased the repayment instalment to $500,000.  KF Ng had told her to deposit her repayments into Elegant’s account since he used to make use of Elegant’s account to receive money on his behalf.

(7) In May 2014, since not all the conditions under the agreement of 2 December 2011 had been met, the sale and purchase of the 30% shareholding in Profit Grand fell through.

(8) The $5 million loan was fully repaid when she made the repayment on 6 February 2015.

Loan Agreement

(9) In September 2013, Mdm To entered into a transaction with a third party (Rich Skill Investments Ltd) whereby she agreed to purchase a 51% shareholding in another company for $62 million payable by a number of instalments between 15 October 2013 and 30 December 2014.  She called this the “Nuku Buying Back Agreement”. 

(10) She sought financing support from KF Ng for the Nuku Buying Back Agreement.  On 30 September 2013, they had a meeting.  What happened is described in Mdm To’s affirmation as follows:

“ I met KF Ng in his room inside Pacific Plywood’s registered office. Inside there, KF Ng requested for immediate repayment of the 5m Loan. At the same time, KF Ng indicated that he would finance me in the Nuku buying back action if I signed a Loan Agreement between Elegant Mark and myself. KF Ng specifically reassured me that the Loan Agreement would never be enforced against me if I did not drawdown any money under it. Furthermore, KF Ng had also told me that the signed Loan Agreement could indicate what interest rate would be agreed by me as borrower, then it could help him to raise fund for me from his boss, Mr. Ji and also other investors. Since my cash had been locked in various investment projects in PNG and Hong Kong at the material time, immediate repayment of the 5m Loan to KF Ng together with the payment obligation under the Nuku Buying Back Agreement would get me with great financial pressure. I eventually signed the Loan Agreement in the presence of KF Ng only at his office with the understanding that: (i) KF Ng would financially support me in Nuku Project interest buying back action; (ii) the Loan Agreement would be used to enable KF Ng to raise fund for me; (iii) the Loan Agreement could not be enforced against me if I did not drawdown money under it; and (iv) as reminded by KF Ng, parties never aimed to enforce the Loan Agreement and no money might be drawn under it.”

(11) Eventually Mdm To did not receive or take out any money under the Loan Agreement.  She fulfilled her obligations under the Nuku Buying Back Agreement with her own resources.

Breach of Money Lenders Ordinance

(12) In any event, the Loan Agreement was in breach of section 7(1)(b) of the Money Lenders Ordinance (Cap 163) (“Ordinance”) as she did not sign it in Elegant’s office and only met with KF Ng who was not a staff member of Elegant.

6.  In the reply affirmation made by KW Ng on 7 February 2020, Elegant’s case was put as follows:

(1) Elegant was a licensed money lender, with its office at Unit 2012, 21/F, West Tower Shun Tak Centre, Sheung Wan, and KW Ng was its loan officer at the time.

(2) A few days before 30 September 2013, KF Ng asked if Elegant could extend a loan to Mdm To, and KW Ng answered in the affirmative.

(3) On 30 September 2013, Mdm To first met KF Ng at the office of Pacific Plywood in the same building on 33/F for their discussions, after which they, together with one Mr Mock who was an employee of Mdm To, came down to Elegant’s office on 21/F.

(4) Elegant and KW Ng did not concern themselves with the dealings between Mdm To and KF Ng.

(5) Mdm To showed a good understanding of the nature of the documents presented to her.  She gave instructions to KW Ng to divide the loan principal into two sums to be paid by cheques to two companies: $17,375,000 to Million Wealth Capital Investments Ltd (“Million Wealth”) and $3,484,000 to Success Source Investments Ltd.  Mdm To signed the Loan Agreement and Mr Mock signed as a witness of her signature in Elegant’s office.

(6) In calculating the amount of interest payable, KW Ng miscalculated the monthly interest payable on the $17,375,000 loan to be $173,500 (when it should be $173,750, being 1%). Together with the monthly interest for the $3,484,000 loan in the sum of $69,680 (being 2% per month), he informed Mdm To at the time that the monthly interest payable was $243,180.

(7) On 2 October 2013, pursuant to Mdm To’s instruction, Elegant issued a cheque in the sum of $17,375,000 in favour of Million Wealth and a cheque in the sum of $3,484,000 in favour of Success Source Investments Ltd.  These cheques were cleared and paid on 2 and 3 October 2013 respectively and the loan was therefore drawn down.  The two cheques and relevant bank account statement of Elegant were exhibited as evidence.

(8) From October 2013 to July 2014, Mdm To made repayments to Elegant as follows:

Date of Payment	Repayment Amount ($)
28 October 2013	243,180.00
2 December 2013	243,180.00
2 January 2014	243,180.00
3 March 2014	243,180.00
3 March 2014	243,180.00
8 April 2014	243,180.00
20 May 2014	243,180.00
2 July 2014	243,180.00

(9)     At around the beginning of July 2014, KW Ng reminded Mdm To not only to pay the interest but also to begin repayment of the principal loan amount.  After this, she increased the amount of monthly repayments as follows:

Date of Payment	Repayment Amount ($)
8 July 2014	500,000.00
4 August 2014	500,000.00
1 September 2014	500,000.00
30 September 2014	500,000.00
18 November 2014	500,000.00
23 December 2014	500,000.00
6 February 2015	500,000.00
10 February 2015	500,000.00
12 March 2015	500,000.00
7 May 2015	500,000.00
15 May 2015	500,000.00
24 July 2015	250,000.00
26 August 2015	250,000.00
10 September 2015	250,000.00
20 September 2015	250,000.00
30 September 2015	250,000.00

The total amount paid from October 2013 to September 2015 was $8,695,440.  Mdm To had not made any further repayment after September 2015.

(10) Mdm To’s repayments were entered into the loan account record maintained by Elegant, a copy of which was produced as an exhibit.

7.  The subsequent solicitors’ correspondence was in writing and not disputed.  Elegant’s solicitors wrote to Mdm To on 4 September 2015, apparently demanding repayment of the loan.[2] On 11 September 2015, Mdm To’s solicitors (Messrs. Chan, Wong & Lam) replied, saying Mdm To was out of town and would be able to have a meeting to discuss the matter on or after 17 September 2015.  Elegant did not take up the offer of a meeting and instead, on 5 October 2015, sent its statutory demand to Mdm To for the sums outstanding under the Loan Agreement, then in the principal sum of $17,419,681.94 with interest of $28,183.86.  Mdm To’s solicitors wrote on 9 October 2015 saying she was never indebted to Elegant, but was prepared to accept service of the statutory demand prior to setting it aside.  The statutory demand was served on Mdm To on 20 October 2015. 

8.  On 17 March 2016, Elegant’s solicitors wrote to Mdm To’s solicitors, with reference to the statutory demand, demanding payment of the aggregate sum of $18,366,659.70, and stating that in the absence of payment Elegant would apply for her bankruptcy without further notice.

9.  On 19 March 2016, Mdm To through another firm of solicitors (Messrs. Paul C K Tang & Chiu) wrote to Elegant’s solicitors, stating:

(1) Mdm To was never indebted to Elegant.

(2) On 24 May 2012, KF Ng lent a sum of $5 million in cash to Mdm To.  He did not charge any interest on the loan or request Mdm To repay the loan.

(3) However, on 30 September 2013, KF Ng brought Mdm To to his office on 33/F, West Tower, Shun Tak Centre.  “Under his duress”, Mdm To was “forced to sign” the Loan Agreement in favour of Elegant.  In fact, Mdm To had never received any money from Elegant.

(4) From 28 October 2013 to 30 September 2015, Mdm To paid a total sum of $8,695,440 to Elegant in satisfaction of the loan lent by KF Ng.

(5) Elegant was asked whether it was prepared to withdraw the statutory demand and release Mdm To from the Loan Agreement.  Mdm To was seriously considering reporting the matter to the police and Securities and Futures Commission for investigation.

10.  There was no further written demand by Elegant, nor any application by Mdm To to set aside the statutory demand, nor (as far as the evidence shows) any report made to any authorities.  More than three years later, on 29 October 2019, Elegant presented the petition in these proceedings, alleging indebtedness in the principal sum of $17,419,681.94 and for interest up to 29 October 2019 in the sum of $8,398,790.82.  The petition was served on Mdm To shortly afterwards.

11.  In his written submissions, counsel for Mdm To has made clear that he is not advancing any argument that the Loan Agreement was vitiated by duress.  Essentially, therefore, the case put forward by Mdm To based on her affirmation is two‑fold. First, the Loan Agreement was not intended to have any effect, and in fact she did not draw down any money on it.  Secondly, the Loan Agreement is unenforceable for breach of section 7(1)(b) of the Ordinance. 

12.  The proper approach to such disputes in bankruptcy proceedings is well established: see eg Re Leung Cherng Jiunn (debtor) [2016] 1 HKLRD 850.  Bankruptcy proceedings are summary in nature, generally determined on the basis of affidavit evidence.  They are not intended for the resolution of substantial disputes of fact and should be used only in clear cases.  It is not sufficient, of course, for the respondent simply to say: “I deny the debt”.  He or she has to present a defence with particulars and sufficiently precise evidence, not “a cloud of objections on affidavits”.[3]  The court looks to see whether there is a bona fide dispute of the debt on substantial grounds, not just a fair probability of one.  In doing so, the court tests what is being asserted for internal coherence and consistency, and also against undisputed or indisputable facts, inherent probabilities and common sense.

13.  I have carefully considered the matters put forward by Mdm To but I have to say I find her central allegations quite incredible.  As an experienced businesswoman involved in running listed companies, she obviously understood what kind of document the Loan Agreement was and its legal effect.  To suggest that the parties never intended any money would be lent under the Loan Agreement and that it would never be enforced begs the question why they would sign it in the first place.  Mdm To’s assertion that it was signed as a document to be used to help KF Ng to raise funds for her not only does not make commercial sense, but is also contrary to the assertion made by her solicitors on her behalf in March 2016 that she was forced to sign it under duress.  It is also to be noted that despite that (on Mdm To’s case) KF Ng failed to raise any funds to help her (as was the alleged purpose), she took no step to have the Loan Agreement revoked or to have Elegant deliver up its copy.

14.  Mdm To’s assertion that she signed the Loan Agreement in the presence of KF Ng only is also contradicted by the witnesses’ signatures of KW Ng and Mr Mock on the document.

15.  Mdm To has denied having received or taken any money under the Loan Agreement.  But KW Ng says the loan was drawn down by payment to two companies, and has produced evidence of the two cheques drawn and paid for precisely the two sums under the Loan Agreement, as well as the loan account records of Elegant. 

16.  Furthermore, the existence of the loan is shown by the repayments made by Mdm To.  It is not in dispute that about one month after the Loan Agreement, Mdm To began paying to Elegant, on a roughly monthly basis, a sum of $243,180, later increased to $500,000, as set out above.  Mdm To sought to explain these payments away as being repayments to KF Ng for the $5 million loan followed by down payments for buying back KF Ng’s interest in the KD Project, but this explanation is in my view not credible because:

(1) Quite apart from the fact that Mdm To has not produced a single piece of written record (eg a cheque or deposit slip, or mobile phone text message) evidencing the alleged $5 million loan, she continued to make further payments to Elegant after 6 February 2015 when, on her own case, the $5 million loan was “fully repaid” after the payment on that date. 

(2) In fact, the repayments had totalled $4,945,440 by 23 December 2014.  Only $54,560 was needed for repaying the $5 million loan which was interest‑free.  The next repayment of $500,000 on 6 February 2015 far exceeded that sum. 

(3) Mdm To sought to explain that the total sum of her payments beyond $5 million, amounting to $3,695,440, was her down payment to KF Ng for buying back his 20% interest in the KD Project.[4]  There is, however, not a single document to support this assertion.  Nor is there any explanation or accounting record as to how the repayment in one sum of $500,000 on 6 February 2015 in part “morphed” into a down payment for her buy‑back of the interest in the KD Project.  Her suggestion that nothing further happened about the buy‑back after these down payments, so that KF Ng had kept the down payments as well as his interest in the project, also does not seem to me to make sense.  Further, the allegation about down payments was contradicted by Mdm To’s solicitors’ letter of 19 March 2016 which stated that she “paid a total sum of HK$8,695,440 to Elegant Mark in satisfaction of the loan lent by Mr Ng Kwok Fai”.

(4) The repayments were made to Elegant rather than KF Ng.  As regards repayment for the alleged $5 million loan, Mdm To said KF Ng told her to do this since he made use of Elegant’s account to receive money on his behalf.  I find this a contrived explanation given that Elegant has its own regulated money lending business to run and is not just a “cash box”.  There is no explanation from Mdm To why the alleged down payment of $3,695,440 for buying back KF Ng’s interest in the KD Project would be paid to Elegant.

(5) The $5 million loan allegedly had no fixed term.  There is no credible reason why Mdm To voluntarily began to make repayments to KF Ng from late October 2013 onwards, given that she was at that time, on her own case, seeking financial support from KF Ng for the purpose of making instalment payments under the Nuku Buying Back Agreement and KF Ng failed to provide any financial support to her and she had a “very hard time”[5] trying to fulfil her obligations under the Nuku Buying Back Agreement.  In fact, in March and June 2014, she had received pre‑action letters from the vendors under that agreement demanding payment of outstanding instalments.  Likewise, there is no credible reason why during her financial difficulties she would pay down payments for buying back KF Ng’s interest in the KD Project when, on her own case, she was not obliged and did not have sufficient money to do so.

(6) There was some suggestion from Mdm To that the $5 million loan had no repayment timeline because Pacific Plywood was planning to buy shares in Profit Grand from Mdm To and the loan could therefore be deducted from the purchase price.[6] However, on her case, Mdm To began repaying the $5 million loan in October 2013, long before the acquisition of Profit Grand shares fell through in May 2014.

(7) The initial monthly repayments were each for the amount of $243,180.  It is inexplicable why a $5 million loan would be repaid in instalments in such an odd sum, particularly when, according to Mdm To, KF Ng did not give her any repayment schedule or timeline.[7] Mdm To said she made the “repayments on irregular basis (on the repayment amounts and time) per [her] cash flow situation”,[8] but there is no sensible reason why her cash flow situation led her to pay the fixed sum of precisely $243,180 for the first eight payments.  In contrast, $243,180 was readily explicable as the sum of $173,500 (being a miscalculation for $173,750) and $69,680, being monthly interest for the two tranches of the loan respectively. 

17.  In his submissions, counsel for Mdm To sought to say that Million Wealth was closely related to KF Ng and Elegant, by referring to the address shown in the annual return of Million Wealth, with a view to casting doubt on whether the cheque paid to Million Wealth was money lent to Mdm To.  That document was however not exhibited to Mdm To’s affirmation, and Elegant has not had an opportunity to respond.  In fact, Mdm To’s counsel has annexed to his submissions and relied upon two other documents which have not been put in evidence.  This is quite improper.  If there are matters Mdm To wishes to raise in response to KW Ng’s affirmation which was served in February 2020, she could and should have sought leave to adduce further evidence, there being ample time to accommodate a further round of evidence.  She has chosen not to do so.  These additional documents do not form part of the available evidence and must now be ignored.

18.  In conclusion, I find that Mdm To has failed to establish any bona fide dispute on substantial grounds by her allegations that the Loan Agreement was never intended to have the effect and that there was no drawdown of any loan.

19.  As to the Ordinance, the only point raised is breach of section 7(1)(b).  Section 7 (1) provides:

“ (1) No person shall carry on business as a moneylender –

(a) without a licence;

(b) at any place other than the premises specified in such licence; or

(c) otherwise than in accordance with the conditions of a licence.”

By section 29(1), contravention of the above requirements constitutes an offence.

20.  The legal principles relating to section 7(1)(b) have recently been discussed by Ng J in Hao Tian Finance Co Ltd v Hung Yuk Ming & Anor [2020] HKCFI 465 at §§119‑124, as follows: 

“ 119. But does it follow, from the fact that the Defendants had not attended the Premises prior to the signing of the Loan Agreement and the Mortgage, that the Plaintiff was thereby in breach of section 7(1)(b) for not carrying on business as a money lender at any place other than the premises specified in its Money Lenders Licence? In this court’s view, the answer must be no.

120. It is not in dispute nor is it disputable that the Premises were the Plaintiff’s office and place of business as specified in its Money Lenders Licence. There is no evidence to suggest that the Plaintiff did not at the material time habitually carry on its money lending business on the Premises. Further, it is a fact found by this court that a substantial part of the preparatory work for the loan application were done and the assessment of the loan application by Keith Lau took place on the Premises between 1 and 4 June 2015. After Raymond had finished his inspection of the Property on 5 June 2015, he also went back to the Premises to brief Keith Lau as to what had happened. It seems to this court a complete non sequitur to suggest that because the very last part of the loan transaction which took place on 5 June 2015 ie the meeting between the Plaintiff’s Keith Lau and Raymond and the Defendants and the signing of the Loan Agreement and the Mortgage took place in a solicitors’ firm, the Plaintiff was not carrying on its money lending business on the Premises.

121. In The Annotated Ordinances of Hong Kong—Money Lenders Ordinance (Cap 163) 2015 Reissue at paragraph 7.02, the author noted:

‘ If the money lending transaction is substantially arranged and started at the authorised place of business of the money lender, it would seem that this would not be in breach of the provision because not every stage or incident of the transaction needs to be carried out at the same address: Kirkwood v Gadd [1910] AC 422, Cornelius v Phillips [1916-1917] All ER 685, [1918] AC 199. It is generally accepted that the licensed money lender, to come within the terms of the provision, does not have to undertake the whole of his tasks at his place of business as shown in the licence ...’ (emphasis added)

122. In Kirkwood v Gadd [1910] AC 422, it was held not to be a breach of the former UK equivalent of section 7(1)(b) where the agreement for the loan, the advance of the money and the taking of security (a bill of sale) all took place at the borrower’s private residence. At pp 423-4, Lord Loreburn LC explained why:

‘ ... This Act of Parliament cannot mean that every stage and every incident of every piece of the money‑lending business is to be transacted at the registered office. That would be impossible, for such things as making inventories or taking possession of furniture under a bill of sale are part of the business and must be done where the goods are situated. Nor can it be intended to prohibit the employment of clerks and agents, or the transaction outside the registered address of every single thing that could by possibility be transacted within it. That would be needlessly oppressive and would strain the words. We must look at the nature of the mischief disclosed according to the approved canons of statutory construction. The mischief is that this dangerous business may be conducted by persons under false names or a variety of names without the security of an ascertained address, or at places where men may be taken unawares or off their guard. The words, which are in terms general, must be applied accordingly.

I do not propose to define what is meant by carrying on business lest I may facilitate evasion. But I do think that if a money‑lender really deals with a borrower at his registered address, whether by interview or correspondence, he may, without infringing the Act, transact negotiations, or conclude the actual contract, elsewhere.’ (emphasis added)

123. In Cornelius v Phillips [1918] AC 199, the whole of the money lending transaction, in every one of its stages as between the money‑lender Phillips and the borrower Cornelius, was carried out at the Blundell Arms Hotel, which was not the registered address of Phillips, and no part of the transaction was carried out at the money‑lender’s address. It was in these circumstances that the House of Lords concluded there was a contravention of the former UK equivalent of section 7(1)(b).

124. To conclude, since a substantial part of the present loan transaction with the Defendants was started and arranged on the Premises, this court is of the view that the Plaintiff had not contravened section 7(1)(b) of MLO.”

21.  Mdm To asserted that the Loan Agreement was signed in Pacific Plywood’s office which was on 33/F instead of Elegant’s office.  However, the Loan Agreement, in the memorandum prepared as required by section 18 of the Ordinance, stated at point (i) that the agreement was discussed and signed at Room 2102, 21/F, West Tower, Shun Tak Centre, which was the licensed premises of Elegant. That page was initialled by both parties.  (Mdm To’s own office, as stated in the Loan Agreement, was in the same building, on 14/F.) There is no explanation from Mdm To at all why she initialled the relevant page of the memorandum if that was not in fact correct. I have already found, as explained above, that Mdm To’s account of what was said at the meeting with KF Ng, including that the Loan Agreement was not meant to be a serious document, is incredible.  That leaves KW Ng’s evidence which was that the parties signed the Loan Agreement in Elegant’s office on 21/F.

22.  But even assuming there is an unresolved dispute whether the Loan Agreement was actually signed at Pacific Plywood’s offices on 33/F or Elegant’s office on 21/F, there is nothing to suggest that Elegant did not generally conduct its money lending business on the 21/F premises or that, in this particular case, the decision to make the loan, the preparation of the documentation and the issuing of the cheques, by which the loan was drawn down, were done in any place other than those premises. 

23.  In these circumstances, applying the principles referred to in Hao Tian Finance, it seems to me that Mdm To has also failed to raise a bona fide dispute on substantial grounds concerning the enforceability of the Loan Agreement on account of section 7(1)(b).

24.  For these reasons, I have come to the conclusion that no valid defence has been shown to the petition.  There will therefore be a bankruptcy order against Mdm To.  As an order nisi, Elegant’s costs of the proceedings will be paid out of the bankruptcy estate, and the Official Receiver’s costs will be paid out of the deposit on the petition.