Re Pak Kwan Ho
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HCB 5909/2016 [2018] HKCFI 54 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE BANKRUPTCY PROCEEDINGS NO 5909 OF 2016 _________________
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_________________ J U D G M E N T _________________ Introduction 1.There is before this court a bankruptcy petition dated 16 August 2016 (“Petition”) presented by China Citic Bank International Limited (“Bank”) against Mr Pak Kwan Ho (“Debtor”). The Petition is based on the non‑compliance with a statutory demand dated 24 May 2016 (“statutory demand”) served personally on the Debtor for the sum of over HK$5.3 million (“Debt”) consisting of:
2.It is indisputable that at least 3 weeks have elapsed since the statutory demand was served on the Debtor and it has not been complied with. There was also no application by the Debtor to set aside the statutory demand. Deliberation 3.It is well‑established that in order to successfully oppose a petition, a debtor has to show a bona fide dispute to the debt on substantial grounds, by sufficiently precise evidence which is believable, and must establish that he actually has a defence of substance, not just a fair probability of one: Wong Lo Fung v AXA China Region Insurance Co Ltd unrep; HCB 1864/2013; 29 August 2014 at [25]–[26]; re Shang Lili unrep; HCB 5329/2014; 25 January 2016 at [10]. 4.In the present case, the Debtor opposes the Petition on one and only one ground. In his 2‑page affirmation in opposition, the Debtor stated at paragraphs 3 and 4:
5.In essence, the Debtor is alleging the Debt has already been repaid when the Bank exercised its right as mortgagee under a Tripartite Legal Charge/Mortgage dated 21 October 2014 in selling the property referred to in paragraph 4 of his affirmation (“Heng Fa Chuen Property”). The Heng Fa Chuen Property was mortgaged by Truetime Industries Limited (in liquidation) to the Bank to secure the indebtedness of inter alia Pada Far East and Colour Apparel Company Limited (“Colour Apparel”). 6.As expected, the Bank disputes the Debtor’s case. In the Bank’s proof of debt dated 5 August 2016 exhibited to the 2nd affirmation of Ng Ka Ki,
7.It is true that the Bank’s proof of debt shows some partial repayments of the indebtedness of Pada Far East, Colour Apparel and Pada Development. As far as the gross sale proceeds of the Heng Fa Chuen Property ie HK$6.23 million were concerned, they were applied to pay off Pada Far East’s invoice financing debts and Colour Apparel’s packing loan. However, as far as the HK$5.1 million owed by Pada Far East and the HK$269,357.45 owed by Pada Development are concerned, there was no repayment, whether from the sale proceeds of the Heng Fa Chuen Property or otherwise. 8.At the hearing, the Debtor was unable to challenge the accuracy of the figures in the Bank’s proof of debt, including in particular, how the Bank applied the sale proceeds of the Heng Fa Chuen Property in partial repayment of the indebtedness of Pada Far East, Colour Apparel or Pada Development. Nor did the Debtor submit any proof that the HK$5.1 million or the HK$269,357.45 have already been repaid. 9.In these circumstances, this court is not satisfied on the evidence that the Debt has been repaid, as alleged by the Debtor. There being no other grounds put forward by the Debtor in opposition to the Petition, a bankruptcy order should be made. Disposition and Costs Order Nisi 10.There shall be a usual bankruptcy order against Mr Pak Kwan Ho and an order nisi that the costs of the Petition, including all costs previously reserved, if any, be to the Petitioning Creditor, to be taxed if not agreed, with certificate for counsel.
Mr Justin Lam, instructed by Joseph S. C. Chan & Co., for the Petitioning Creditor The Debtor appeared in person Attendance of the Official Receiver was excused |
Cases cited in this judgment