WONG WAI PING JADIE AND ANOTHER v. REGISTRAR OF COMPANIES AND OTHERS

HCMP 1149/2018

[2018] HKCFI 2501

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1149 OF 2018

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REASONS FOR JUDGMENT

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1.  This is an application under section 42 of the Companies Ordinance (Cap 622) (“Ordinance”) for an order that the following documents in respect of the Company be removed from the Companies Register:

(a)  a Form ND4 filed on 14 May 2018 reporting the resignation of the 1^stapplicant as director and company secretary on 11 May 2018;

(b)  a Form ND4 filed on 14 May 2018 reporting the resignation of the 2^ndapplicant as director on 11 May 2018;

(c)  a Form ND2A filed on 28 May 2018 reporting the cessation of the 1^stapplicant as director and company secretary and the 2^ndapplicant as director from 11 May 2018, and the appointment of the 3^rdrespondent as director and the 4^threspondent as company secretary on 11 May 2018;

(d)  a Form ND2A filed on 7 June 2018 reporting the cessation of the 3^rdrespondent as director and appointment of the 5^threspondent as director on 21 May 2018;

(e)  a Form ND4 filed on 7 June 2018 reporting the resignation of 3^rdrespondent as director on 21 May 2018;

(f)  a Form ND2A lodged on 14 May 2018 reporting the same information as in the Form ND2A in item (c) above;

(g)  the Form ND2A lodged on 21 May 2018 reporting the same information as in the Form ND2A under item (d) above; and

(h)  a Form ND4 lodged on 21 May 2018 reporting the same information as in the Form ND4 under item (e) above.

2.  At the hearing on 5 October 2018, I made an order in terms of paragraph 1(a) to (e) of the Originating Summons.  I also ordered costs to be paid by the 3^rd to 5^threspondents to the applicants.  I now set out my reasons for doing so.

Background

3.  The Company was incorporated in Hong Kong on 21 April 2011.  According to the applicants, they are a retired couple and have been the only directors and members of the Company since May 2011 holding 50% of the shares each.  The 1^stapplicant was also the company secretary.  They used the Company to hold a property in a development known as Beverly Hills in Tai Po (“the Property”) which was leased out providing stable rental income until the tenant moved out in March 2018.

4.  When the tenants moved out, the applicants decided to move into the Property and started a major renovation.  They settled in the Property thereafter on 25 June 2018 and asked their accountant to change the Company’s registered address from their previous home in Stubbs Road to the Property.  It was then discovered that the 3^rdrespondent had filed 8 documents with the Companies Registry (“CR”) concerning the alleged resignation by the applicants and appointment of the 4^th and 5^th respondents as the company secretary and director from 21 May 2018.  Their case is that they have never resigned and their signatures were forged.  They do not know the 3^rd to 5^threspondents and have never authorised them to do what they did.

5.  The matter was reported to the police and it was soon revealed that a Mr Lau, claiming to the landlord of the Property, had offered the Property for sale in an online property website.  The contact telephone number of the said Mr Lau is identical to the one used by the 3^rd respondent in the documents filed with the CR. 

6.  Alarmingly, it was also discovered that the 5^th respondent had through his solicitors registered a statutory declaration dated 14 June 2018 with the Land Registry claiming (as director and shareholder of the Company) that the title deeds and documents of the Property were lost and could not be located.

7.  The applicants’ solicitors wrote to the 5^threspondent’s solicitorswho was responsible for preparing the statutory declaration (Jal N Karbhari & Co) on 29 June 2018 pointing out the title documents have never been lost and demanded that the registration of the statutory declaration be withdrawn.  On 6 July 2018, the 5^threspondent’s solicitors wrote to inform the applicants that the statutory declaration had been returned to them by the Land Registry and that “further action in connection with the said statutory declaration shall be stayed until further notice”.

8.  Attempts were made by the applicants’ solicitors to correspondwith the 3^rd to 5^th respondents but they were, unsurprisingly, nowhere to be found.  The letters to them were returned and the relevant information was provided to the Registrar of Companies for investigation.

9.  Section 42(1) and (4) provides as follows:

“ (1) The Court may, on application by any person, by order direct the Registrar to rectify any information on the Companies Register or to remove any information from it if the Court is satisfied that—

(a) the information derives from anything that –

(i) is invalid or ineffective; or

(ii) has been done without the company’s authority; or

(b) the information—

(i) is factually inaccurate; or

(ii) derives from anything that is factually inaccurate or forged.”

“ (4) The Court must not order the removal of any information from the Companies Register under subsection (1) unless it is satisfied that—

(a) even if a document showing the rectification in question is registered, the continuing presence of the information on the Companies Register will cause material damage to the company; and

(b) the company’s interest in removing the information outweighs the interest of other persons in the information continuing to appear on the Companies Register.”

The Registrar’s position

10.  The Registrar of Companies (ie the 1^st respondent) took a neutral stance in this application.  A statement pursuant to section 43(2) of the Ordinance (“Statement”) was filed setting out his observations in this matter.  The Registrar observed that of the 8 documents in question, the 3 items under paragraph 1(f) to (h) of the Originating Summons were “pending” but not filed and are not information on the Companies Registerand cannot be “removed” as such.  In light of this comment, the applicants agreed that no order is sought in respect of these 3 items.  

11.  In addition to the aforesaid, the Statement also sets out the attempts made by the Registrar to seek the 3^rd to 5^threspondents’ representations on the allegations of the applicants and that the relevant letters were returned for various reasons. 

12.  The Registrar also drew my attention to section 42(8) of the Ordinance which provides that if the Court makes an order under section 42, the person who made the application must deliver an office copy of the order to the Registrar for registration.  Registration of the order shows a complete picture of the matter, facilities the public in tracing and understanding the changes of information in the Companies Register.

Discussion

13.  On the basis of the evidence before me, there is no reason to question the allegations of the applicants.  It would appear that they are victims of a fraudulent scheme and the information contained in the documents filed behind their backs are invalid and the acts were committed without the Company’s authority.  The signatures of the applicants would appear to have been forged.  The continuing presence of the information in the documents on the Companies Register will obviously cause material damage to the Company and the Company’s interest in removing the information outweighs the interest of other persons in the information continuing to appear on the Companies Register.

14.  In the circumstances, I had no hesitation in making the orders set out in paragraph 2 of this judgment.