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HCMP 498/2008
IN THE HIGH COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
COURT OF APPEAL
MISCELLANEOUS PROCEEDINGS NO. 498 OF 2008
(ON AN INTENDED APPEAL FROM HCB NO. 6096 OF 2007)
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| Re: |
YAU KWONG WANG (邱廣宏), |
the Judgment Debtor |
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| Ex Parte: |
TSO YUK YIN (曹玉燕), |
the Petitioner |
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Before: Hon Tang VP in Chambers
Date of Hearing: 2 April 2008
Date of Decision: 2 April 2008
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DECISION
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1. The judgment debtor was adjudicated bankrupt on 10 December 2007. The bankruptcy petition was based on a statutory demand dated 17 May 2007. The debt relied on in the statutory demand was a sum of HK$8,386,346.99 less HK$368,000.00 being the total amount for the security held making a net sum of HK$8,018,346.99. That figure included a sum of HK$3,634,555.71 being the amount of a judgment debt. The balance was made up of interests on the judgment debt. The judgment which was relied on in the statutory demand was the order of Kwan J which was dated 1 August 2001, where she dismissed the judgment debtor’s appeal from the decision of Master De Souza given on 18 April 2001. The order of 18 April 2001 was the one in which the petitioner obtained summary judgment against the defendant.
2. Central to the bankrupt’s application for leave to appeal out of time is that since the statutory demand was made on 17 May 2007, the claim for judgment interest had been barred by the effuxion of time. The point being that time for the payment of interest commenced from the order of Master De Souza dated 18 April 2001 which was more than 6 years from the date of statutory demand. Thus, it is said that the genuine claim of the petitioner was only HK$3,909,435.71. That amount was arrived at after deducting the non-recoverable total interest of HK$4,108,911.28. It was said on behalf of the bankrupt by Mr Mui, in his well-prepared skeleton submissions, that:
“Comparing the substantial difference between the genuine claim in the sum of HK$3,909,435.71 and the sum of HK$8,018,346.99, alleged to be due under the Statutory Demand, it gravely affected the assessment of the Judgment Debtor in seeking assistance from family and friends with the view to pay off the debt when facing the Bankruptcy proceedings.”
3. That submission is based on the judgment debtor’s affirmation filed on 25 March 2008.
4. So far no attempt has been made by the bankrupt to pay off the genuine debt. Nor do I believe that is a sufficient reason to set aside the bankruptcy order since the judgment debt has been owed since 2001 and there is no reason why that debt should not be paid.
5. The bankrupt also claimed in his affirmation that the petitioner has a charging order over the “Building erected on The Remaining Portion of Lot No. 2061 in Demarcation District No. 19, Tai Po, New Territories” (“the Property”). According to him, the Property has been valued at HK$4,500,000.00 and he has produced a valuation report dated 28 September 2007 prepared by C S Surveyors Limited. From that report, it appeared that the judgment debtor owns two-third of the Property as tenant in common with one Yau Chi Wang, and it appeared that the bankrupt acquired his two-third interest for HK$200,000 on 15 May 1997. From the photographs attached to the surveyor’s report, it appears that not only is the building unfinished, it is in a derelict state. The valuation report is quite useless because the valuation was made on the assumption that the “Internal Conditions” of the building was:
“Assumed good when the renovation & finishing works completed”.
6. There is no indication as to how much such work might cost. There is no indication that the co-tenant would cooperate. In any event, the judgment debtor has only a two-third interest in the Property.
7. As for other properties over which it is said that the petitioner has a charging order, the value put on the Property by the bankrupt is HK$1,000,000. I see no reason why any reliance should be placed on the valuation placed on them by the bankrupt. In any event, they are far from being sufficient to satisfy the genuine and undisputable judgment debt.
8. I go to the question of delay. The bankruptcy order was made on 10 December 2007. It was sealed on 28 January 2008, and time to appeal expired on 25 February 2008. The application for extension of time was filed on 18 March 2008. The delay was 22 days.
9. Mr Mui said the bankrupt was unrepresented at the critical time. It appeared that he was only represented between September and December 2007. The lack of representation is a relevant consideration which must be balanced against other factors. One should of course not adopt a rigid or mechanistic approach to an application for an extension of time. One must weight all the circumstances and decide where the overall justice of the case lie. Mr Mui has also informed me that the petitioner has no objection to the extension of time being granted provided the bankrupt placed a sum of HK$100,000 into court. But that is one of the matters that I should consider. It is important in such circumstances that the court must look at all the circumstances. In considering the time, one has to have regard to the fact that the bankruptcy order was based on a judgment obtained as long ago as 2001. The bankrupt seemed to be suggesting that unless the bankruptcy order is set aside, he would necessarily be burdened with the full amount stated in the statutory demand. But that is not necessarily the case since in due course the official receiver when considering the proof of debt submitted will take account of the bankrupt submission that the judgment interest has become statute-barred, and to determine whether that is so.
10. Mr Mui also submitted that if I am not satisfied with the valuation report, the matter should be adjourned so that a further valuation report should be produced. But that is highly unsatisfactory. The bankrupt is seeking an extension of time. He is represented and if he wished to put in a proper valuation report he should have done so.
11. Nor am I satisfied that there is any reasonable prospect of the appeal succeeding. Even if the point had been made before the making of the bankruptcy order that some or all of the interests under the judgment had become statute-barred, there would still have remained an undisputed debt of about HK$4,000,000.
12. For the above reasons, the application for leave to appeal out of time is dismissed with costs to be taxed.
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(Robert Tang)
Vice-President |
Mr Mui Moosdeen Azmat of Messrs A. M. Mui & Kwan, for the Judgment Debtor.
The Petitioner, in person, present.
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