RE CHAO SZE BANG FRANK

HCB 549/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO. 549 OF 2000

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J U D G M E N T

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1. On 19 January 2000, a statutory demand was served on the debtor Chao Sze Bang Frank by the petitioner demanding payment of US$6,305,772.88. The demand was made on the basis that the debtor had guaranteed the liabilities of a company owned by him, Finex Shipping Ltd. The guarantee was executed on 15 October 1997.

2. As the statutory demand was not complied with, a petition for bankruptcy was presented against the debtor on 22 February 2000. It was served personally on the debtor the following day.

3. On 5 July 2000 the debtor issued a summons to strike out the petition for abuse of process.

4. At a directions hearing on 13 July 2000. It was ordered that the application for striking out would be heard first, as the debtor had objected to the petition and the striking out application to be heard together.

5. The decision on the striking out application was handed down on 20 September 2000 and on 3 October 2000, it was ordered that the petition was to be struck out.

6. The petitioner appealed to the Court of Appeal against this order of striking out, meanwhile and on 17 February 2001, the debtor passed away. On 11 March 2002, the Court of Appeal allowed the petitioner's appeal and the petition was restored for hearing. In gist, the Court of Appeal held that the claim of the petitioner was a liquidated claim and there was no substantial dispute regarding the debt. As the petition was presented against the debtor when he was alive, by virtue of s.103 of the Bankruptcy Ordinance Cap. 6, the death of the debtor does not put an end to the bankruptcy proceedings but the proceedings would continue against him as if he were alive.

7. The petition was restored for hearing before me on 22 March 2002. I adjourned the hearing to 9 April 2002 as I was given to understand that the debtor's son has only obtained a limited grant of letters of administration and he is to represent the estate of the deceased debtor only for the purpose of resisting the petitioner's appeal. The solicitors for the administrator with the limited grant have written to the court stating that they needed time to take advice whether a Beddoe order would be sought to enable the administrator to appeal from the decision of the Court of Appeal to the Court of Final Appeal. At the adjourned hearing on 9 April 2002, the solicitors for the administrator have decided not to seek a Beddoe order for the purpose that I have mentioned.

8. I further adjourned the petition to today for the petitioner to serve the papers on the Official Administrator as there is no one to represent the estate of the deceased debtor. This has been done on 16 April 2002. No notice has been received from the Official Administrator of any intention to contest the bankruptcy proceedings.

9. In the circumstances, I make a bankruptcy order against the deceased debtor with costs of the proceedings to the petitioner.