RE YEUNG WAH WAI

HCB 7858/2020

[2021] HKCFI 1077

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO 7858 OF 2020

__________________________

__________________________

__________________________

JUDGMENT

__________________________

A. INTRODUCTION

1.  This is the petition by the petitioner for a bankruptcy order against the debtor.  It is alleged that the debtor is justly and truly indebted to the petitioner in the aggregate sum of HK$61,243.63 (as at 14 September 2020).    Also before me is an application by the debtor to strike out the bankruptcy petition.

2.  On 15 October 2020, a statutory demand for the aforesaid sum was served on the debtor personally. The debtor did not comply with the demand, nor did he take steps to have it set aside.

3.  By reason of section 6A(1)(a) of the Bankruptcy Ordinance[1], the debtor appears to be unable to pay the debts comprising the said sum, for the purpose of section 6(2)(c) of that Ordinance.

4.  The debtor was formerly a tenant of the petitioner.  Disputes arose between them regarding alleged water leakages in the subject premises and unpaid rent, with the result that proceedings were commenced by the petitioner against the debtor in the Lands Tribunal[2], and by the debtor against the petitioner in the District Court.[3]

5.  In the Lands Tribunal, by a judgment dated 30 March 2016, the debtor was inter alia ordered to pay the petitioner a total of HK$8,380.69 (being rent, mesne profits, utility charges and costs). 

6.  At the hearing, the debtor told me that he appealed from the said judgment of the Lands Tribunal to the Court of Appeal sometime in 2017 but the appeal was dismissed.  There has been no application for leave to appeal to the Court of Final Appeal.

7.  As for the District Court action, by an order dated 24 October 2016, and by a decision dated 15 December 2017, the debtor was ordered to pay costs of HK$200 and HK$500 respectively.   The District Court action was dismissed by HH Judge Winnie Tsui on 18 September 2017.

8.  The debtor applied for leave to appeal from the judgment of HH Judge Winnie Tsui, which was dismissed by Her Honour on 15 December 2017 and by the Court of Appeal on 26 September 2018[4].  The Court of Appeal awarded costs in the sum of HK$45,000 against the debtor.

9.  The Court of Appeal having refused leave to appeal, that is the end of the matter, as the debtor cannot take the matter up to the Court of Final Appeal.[5]

10.  The said sum of HK$61,243.63 is made up of four sums referred to in [5], [7] and [8] above (with interest on the costs awarded by the Court of Appeal added), none of which has been paid by the debtor.

11.  By a writ dated 3 August 2020 issued in the Court of First Instance[6], the debtor sued the petitioner for breach of contract, being the tenancy agreement between them which was the subject matter of the previous litigations between them, based on alleged water leakages, as well as defamation, based on the defence and the witness statement filed by the petitioner in the District Court action.  As confirmed by the debtor before me, the subject matter in this High Court Action, apart from the defamation claim, is the same[7] as those litigated between the parties before.  But even for the defamation claim, that arises out of those litigations.

12.  On 24 November 2020, the petitioner presented the bankruptcy petition against the debtor. 

13.  By order dated 17 December 2020, Master Jack Wong struck out the High Court Action.

14.  On 23 December 2020, the debtor applied to strike out the order of Master Jack Wong.  The application was dismissed by Master Lai on 2 February 2021.

15.  Then, on 2 February 2021, the debtor took out another summons in the Court of First Instance, applying for an order setting aside the order of Master Jack Wong. The hearing has been fixed to be heard before Au-Yeung J on 14 April 2021. 

16.  Also, on 2 February 2021, the debtor issued a summons seeking to strike out the bankruptcy petition, relying on the following grounds:

“1.1 So far the Petitioner’s mentioned cases which has not completed yet, meaning the Debtor still have a chance to make appeals for these cases in the future.

1.2 The Petitioner do not reveal that a new case HCA 1289/2020 is in progress currently between the Debtor and the Petitioner”.

B. DISCUSSION

17.  As far as I can understand from the debtor, based on his oral submissions, his summons of 2 February 2021 seeking to strike out the bankruptcy petition, his “Broad Grounds in Support of Striking Out Application” dated 22 February 2021, and his “Statement of Disproving the Third Affirmation of Ng Wai Kit’s False Accusations” dated 8 April 2021, the debtor argues that the disputes between him and the petitioner are not finally resolved, as they are subject to further appeals and to the High Court Action.  As they are not finally concluded, the debts, all arising out of the previous litigations between him and the petitioner, should not be paid by him.

18.  I reject the debtor’s argument completely.

19.  As far as the previous District Court action is concerned, the debtor has reached the end of the road, as the Court of Appeal had refused him leave to appeal.  There can be no further appeal: see [9] above.  There is no prospect at all of the costs orders made in the District Court and in the Court of Appeal ([7] and [8] above) being set aside, whether in the High Court Action or otherwise.

20.  As far as the Lands Tribunal matter is concerned, while theoretically the debtor can apply for leave to appeal to the Court of Final Appeal out of time, in view of the long delay any prospect of that succeeding is, in my judgment, extremely remote.  When asked by me at the hearing, the debtor says he has not yet taken out any application for leave to appeal because the High Court Action is ongoing.  But I note that even when the writ in the High Court Action was issued, the time limit for him to apply for leave to appeal has long expired.  For all practical purposes, in my judgment, there would be no appeal from the Lands Tribunal judgment and the sum awarded against him would not be set aside.

21.  Quiet apart from the fact that the High Court Action is, as at the date of the hearing of the bankruptcy petition before me, being struck out and so is not, as the debtor alleges, “active”, even if somehow that action is “resurrected” by the latest application by the debtor[8], in my judgment that action cannot set aside or otherwise affect the orders awarding the various sums to the petitioner in the previous litigations.  Those sums are final and due and payable no matter what happens in the High Court Action.  The existence of this High Court Action, which is currently struck out, is in my judgment not a sufficient reason for me to exercise my discretion not to make the bankruptcy order against the debtor. 

22.  I see no reason not to make a bankruptcy order against the debtor and I do so.  I also dismiss the debtor’s summons seeking to strike out the bankruptcy petition.

23.  There shall be the usual bankruptcy order against the debtor.  The costs of the bankruptcy petition and of the summons dated 2 February 2021 seeking to strike out the bankruptcy petition shall be paid by the debtor to the petitioner, to be taxed if not agreed, and paid forthwith.

24.  I thank Mr Ng Wai Kit for his assistance.