The Official Receiver v. Yen Ching Wai, David (Aka David Yen Ching Wai) and Another
Read the full judgment text of HCMP 1871/2022 on BabelCite. This High Court CFI judgment was delivered on 23 February 2024.
1. There is before the court an application made by the Official Receiver (“ OR ”) for a disqualification order against Mr David Yen and Mr Stephen Liu, both of Ernst and Young Transactions Limited (“ Respondents ”), pursuant to s.168G of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32) (“ Ordinance ”). The application is made by Originating Summons filed on 15 November 2022 (“ OS ”) and is supported by the OR’s 1 st Report made on the same date (“ 1 st Report ”).
Cited by 1 case · Cites 17 cases
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HCMP 1871/2022 [2024] HKCFI 546 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE MISCELLANEOUS PROCEEDINGS NO 1871 OF 2022 ___________________
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_______________ J U D G M E N T _______________ 1.There is before the court an application made by the Official Receiver (“OR”) for a disqualification order against Mr David Yen and Mr Stephen Liu, both of Ernst and Young Transactions Limited (“Respondents”), pursuant to s.168G of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap 32) (“Ordinance”). The application is made by Originating Summons filed on 15 November 2022 (“OS”) and is supported by the OR’s 1st Report made on the same date (“1st Report”). 2.The parties have agreed to dispose of the application by way of Carecraft procedure and have signed a Statement of Agreed Facts (“Statement”) for such purpose. 3.The OR submits, and the Respondents agree, that having regard to the nature and severity of the breaches of duty and misconduct and the various mitigating factors set out in the Statement, a disqualification period of 6 years would be appropriate.[1] A. BACKGROUND 4.Luen Tat Watch Band Manufacturer Limited (“Luen Tat”) was a family company operated by the “Li Family”.[2] It was founded by the late Mr Lee Sai Nam (“Father”). Three of his children, Mr Li Shu Chung (“Ken”), Mr Lee Shu Hang (“Richard”), and Ms Li Sin Man (“Seline”) were also involved in Luen Tat’s business.[3] 5.Ken through his corporate vehicle held 51% shareholding in Luen Tat, while Father held the remaining 49% through his corporate vehicle, Allied Ever Holdings Limited (“Petitioner”).[4] 6.The Li Family also operated other companies set up by Father, which included Lianda Metal Watchband (Shenzhen) Co Ltd (“Shenzhen Lianda”), a manufacturing entity, as well as Yuen Hing Enterprise Macao Commercial Offshore Ltd (“Yuen Hing”), a company incorporated in Macao for tax purposes.[5] 7.The Li Family eventually fell out, with Father, Richard, and Seline in one camp (“Father’s Camp”), and Ken in the other. Ken, being the sole director of Luen Tat, gradually ousted his siblings and usurped control of Luen Tat.[6] Father commenced HCA 1711/2009 (“Main Action”) to seek a declaration that he was the sole beneficial owner of all the shares in Luen Tat.[7] 8.At the same time, both Father (through the Petitioner) and Ken sought to put Luen Tat into liquidation. Luen Tat was wound up by the court on 6 July 2010,[8] and the Respondents were appointed as liquidators, having been appointed as provisional liquidators on 24 June 2010.[9] 9.After a full trial in the Main Action, on 9 December 2015, DHCJ Leung handed down his judgment (“Leung Judgment”) finding that Father was the sole beneficial owner of all the shares in Luen Tat.[10] Ken’s appeal against the judgment was dismissed by the Court of Appeal on 19 January 2017.[11] 10.On 26 May 2016, the Petitioner applied for a stay of the winding up of Luen Tat, and to remove the Respondents as liquidators (“Removal Application”).[12] The applications were heard by DHCJ To on 13 July 2017. In his judgment dated 27 November 2017 (“Judgment”), the learned Judge ordered a permanent stay of the winding up proceedings in respect of Luen Tat,[13] and found that the Respondents had committed 6 categories of misconduct which justified an order to remove them from office.[14] 11.In the Judgment, the Judge found that in contesting the Petitioner’s application, the Respondents “have been actively attempting to mislead this court”, which could not have been the result of an error in judgement. The Judge expressed “strong indignation and condemnation” for the Respondents’ conduct, which he considered “put shame on the court”.[15] 12.At §131 of the Judgment, the Judge remarked that in view of his comments, the only course was to remove the Respondents from their appointment with “an advice to the Official Receiver to review their suitability as liquidators”. 13.The Respondents appealed against the Judgment. The appeal was dismissed by the Court of Appeal by judgment dated 27 April 2021 in CACV 11/2018 (“CA Judgment”).[16] The Respondents did not appeal against the CA Judgment. 14.Following the removal, there was a dispute between Luen Tat (controlled by Father’s Camp) and the Respondents over the return of documents in HCMP 1071/2018.[17] This resulted in the judgment given by DHCJ Le Pichon dated 7 October 2020[18] where the learned Judge criticised the Respondents’ conduct over the slow return of documents, remarking that their conduct “inevitably casts doubt on their suitability for appointment as liquidators” and that “they have conducted themselves disgracefully in this saga, and deserves sanction”.[19] 15.The Respondents applied for a stay of the order made by DJHC Le Pichon pending their intended appeal,[20] which was refused by Recorder Houghton SC in his Decision dated 31 March 2021.[21] 16.In light of the above judicial comments, the OR commenced an investigation into the Respondents’ conduct as liquidators in relation to the liquidation of Luen Tat to assess their suitability as liquidators.[22] In doing so, the OR made enquiries with the Respondents as to, inter alia, the 6 categories of misconduct identified in the Judgment. The Respondents, through their solicitors, provided their explanations in writing.[23] 17.Having considered the relevant court judgments and the Respondents’ explanations, the OR took the view that the Respondents had misconducted themselves and acted in breach of their duties which justify the imposition of a disqualification order under s.168G of the Ordinance. The OS was thus issued and the 1st Report filed in support. 18.Although the judgments referred to above (and their findings therein) formed the basis of the OR’s investigation, the OR came to her independent conclusion following her own investigation.[24] In the 1st Report, the OR explains that having considered the further information and explanations provided by the Respondents after the Judgment and the CA Judgment, she came to different views in respect of 2 matters which formed part of the misconduct identified in the Judgment.[25] 19.The Respondents initially opposed the application and sought multiple extensions of time to file evidence in opposition[26]. It was only until 28 July 2023 that the Respondents (and the OR) agreed to dispose of the application by way of Carecraft procedure on the basis of the agreed facts set out in the Statement. B. APPLICABLE PRINCIPLES 20.The principles are well established and have been set out in the submissions of Ms Sara Tong SC[27], counsel for the OR. 21.S.168G(1)(b) of the Ordinance provides that the court may make a disqualification order if a liquidator has been guilty of any fraud in relation to the company or of any breach of his duty. 22.As regards Carecraft procedure:
23.As for period of disqualification:
24.Mr Maurellet accepts that the court is by no means bound by any agreement reached between the OR and the Respondents but submits that it may nevertheless still “be guided by their agreement”. The practice stems from the court’s recognition that a “responsible regulator would have reached an agreement as to the appropriate sanction to be imposed” (SFC v Chin Jong Hwa [2019] HKCFI 2735 §32). 25.As for the approach towards the period of disqualification, Mr Maurellet submits (and I agree) that:
26.Ms Tong refers to 3 cases where the court had to decide the length of disqualification of liquidators:
C. RESPONDENTS’ BREACHES OF DUTY 27.The OR conducted her own investigation into the misconduct identified in the Judgment and upheld by the Court of Appeal. Most but not all of such misconduct have been included in the Statement as agreed facts. The Respondents accept that they committed 6 categories of misconduct and breaches of duty as liquidators of Luen Tat as further described below. C1. Entertaining 3 proofs of debt 28.The way the Respondents entertained and dealt with 3 proofs of debt (“POD”) submitted to Luen Tat were found by the court as (1) given rise to a perception of bias in favour of Ken, and/or (2) as having been motivated by their own desire and interest to stay in office as liquidators.[31] C1.1 Ken’s POD 29.In the Main Action, Ken claimed that he was entitled to HK$53,602,977.76 from Luen Tat as profits.[32] His claim was rejected after trial in Leung Judgment.[33] 30.In August 2016, Ken submitted a POD for HK$52,879,963.53 on the basis that he was entitled to certain profits of Luen Tat derived from sales to Apple Inc.[34] The Respondents did not admit or reject Ken’s POD. In May 2017 (i.e. 2 months before the hearing of the Removal Application), the Respondents wrote to Ken to ask for further documentary evidence.[35] 31.In the Removal Application, the Respondents argued that although Ken’s claim as beneficial owner of Luen Tat was rejected by the court, Ken’s POD could still be justified on the basis that he was entitled to Luen Tat’s profits as former employee and/or agent.[36] 32.DHCJ To held that the Respondents acted wrongfully in entertaining Ken’s POD as they should have followed the Leung Judgment and rejected the POD instead of keeping it alive for 9 months to support their case that Luen Tat was insolvent and to justify their continuation in office.[37] This demonstrated the Respondents’ bias in favour of Ken and against the Father’s camp.[38] The findings were upheld by the Court of Appeal.[39] 33.The OR agrees with the findings of the Judge and his view that Ken’s POD should not have been entertained at all given that:[40]
34.The Respondents accept the OR’s criticisms that their treatment of Ken’s POD was influenced by their own interest to stay in office and gave rise to a perception that they were biased in favour of Ken.[44] C1.2 SML’s POD 35.On 13 August 2012, Sun Moral Limited (“SML”) (a company controlled by Wong Shun Chiu (“Wong”)) filed a POD which included a claim for HK$2,649,634.11 allegedly as fees for quality control services.[45] 36.While the OR considers that there were grounds to investigate SML’s POD, there was insufficient information for the Respondents to adjudicate upon it.[46] Nevertheless, the Respondents admitted SML’s POD just 2 months before the hearing of the Removal Application.[47] 37.DHCJ To considered that SML’s POD was “bogus” (and should have been rejected), and the Respondents’ decision to admit it was “perverse”.[48] The Court of Appeal upheld the finding.[49] 38.In the Statement, the parties have not adopted DHCJ To and the Court of Appeal’s findings in full. The OR takes the view that there was some basis for the Respondents to investigate SML’s POD (which was based on a profit sharing arrangement), it was wrong for the Respondents to have admitted the same as there was insufficient information for them to adjudicate upon it. This was precisely the reason relied on by the Respondents in applying for an order for production of documents, which was granted by DHCJ Manzoni SC in his Decision dated 17 June 2015.[50] 39.The Respondents accept that they should not have admitted SML’s POD when there was insufficient information to adjudicate upon it. They also accept the OR’s criticisms that they admitted SML’s POD shortly before the Removal Application for the purpose of showing that Luen Tat was insolvent and to justify their continued appointment.[51] C1.3 Wong’s POD 40.In March 2016, Wong submitted a POD for HK$36 million on the basis that he had made capital contributions to acquire the land held by Shenzhen Lianda.[52] The claim was made in reliance on certain Chinese notes dated 1994 and 1995, which was raised by Ken for the first time when appealing against the Leung Judgment, to support his case that Wong was a shareholder of Shanghai Lianda. The Court of Appeal rejected such argument.[53] 41.The Respondents did not accept or reject Wong’s POD, but relied on it in the Removal Application to show that Luen Tat was insolvent and to justify their continuation in office.[54] 42.DHCJ To was highly critical of the Respondents for entertaining Wong’s POD and keeping it alive when any reasonable liquidator would have rejected it forthwith in the face of the Leung Judgment and the CA Judgment.[55] The Judge held that (1) the Respondents’ conduct gave rise to a perception of bias in favour of Ken as there was clear evidence that Ken and Wong were “in cahoots with each other”;[56] (2) the Respondents wrongfully kept the POD alive to boost Luen Tat’s insolvency and to justify their continuation in office.[57] The Court of Appeal upheld such findings.[58] 43.The OR takes the view (and the Respondents accept) that the Respondents ought to have rejected Wong’s POD, especially in light of the findings in the CA Judgment. There was no basis for Wong to claim that his alleged capital contributions to Shenzhen Lianda could be converted into a debt claim against Luen Tat, when Luen Tat held no shares in Shenzhen Lianda. In any event, Wong’s case was inconsistent with Ken’s position in the Main Action namely, that (1) he and his father were the only contributors in setting up Shenzhen Lianda, and (2) Wong’s contributions went to the establishment of Hong Kong Pak Tat Trading Co (another company set up by Father).[59] 44.The Respondents accept the OR’s criticisms that their attitude towards Wong’s POD was influenced by their desire to stay in office, and gave rise to the perception of bias.[60] C2. Reliance on alleged hidden tax liability 45.Prior to its liquidation, Luen Tat ran a re-invoicing scheme for tax purposes. Li Family did so by interposing Yuen Hing (a Macao entity) between the sales from Shenzhen Lianda (manufacturing entity) and Luen Tat itself. Luen Tat’s profits were captured by Yuen Hing and therefore not subject to Hong Kong tax (“Tax Scheme”).[61] 46.Ken reported the Tax Scheme to the Inland Revenue Department (“IRD”) in September 2010.[62] In May 2012, Luen Tat and the IRD reached a settlement whereby Luen Tat agreed to pay HK$13.1 million to the IRD as additional tax and penalty (“2012 Settlement”).[63] 47.In October 2014, Stephen Liu stated in his affirmation that the Respondents discovered that Luen Tat might have additional tax liabilities, which were further explained in David Yen’s affidavit filed in the Removal Application.[64] 48.Having raised the additional tax liability issue in October 2014, the Respondents did not take any action for almost 3 years. Instead, in June 2017 (one month before the Removal Application hearing), the Respondents reported the additional tax liability to the IRD and asked the IRD to submit a fresh POD.[65] The Respondents relied on such additional tax liability as one of the grounds to resist the Removal Application.[66] 49.DHCJ To was highly critical of the Respondents’ conduct. He found that the Respondents were “actively misleading” the court by presenting the discovery of 2 sets of accounts kept by Shenzhen Lianda as “recent” discoveries.[67] The Judge also criticised the Respondents for raising issue about “commercial morality” and “smeared” the Li Family to justify their need to stay in office so that they could investigate the additional tax liability.[68] The Court of Appeal upheld such findings and held that the Respondents’ handling of this tax issue by reporting it again to the IRD on the eve of the hearing of the Removal Application “reflected most badly on their conduct as liquidators”.[69] 50.The OR does not adopt DHCJ To’s criticism that the Respondents presented the discovery of 2 sets of accounts in Shenzhen Lianda as “recent” discovery[70], given that (1) Yuen Hing’s expenses did not match either of Shenzhen Lianda’s 2 sets of accounts[71]; and (2) the public/private accounts only affected the extent of Yuen Hing’s understated expenses. 51.Nonetheless, the OR takes the view (which the Respondents accept) that the Respondents’ treatment of this issue draws criticisms:
52.The Respondents accept the OR’s criticisms that they relied on the alleged tax liability to justify their continued appointment as liquidators of Luen Tat, and they did so for their own interest.[75] C3. Providing documents to Ken during the Main Action 53.The Main Action was fought over a 20-day trial which took place between March and August 2014.[76] The Respondents sent representatives to attend the entire trial, but were not able to identify any written instructions given to staff or any reports or attendance notes prepared by them.[77] 54.When Seline was giving evidence, Ken requested the Respondents to provide him with documents to rebut her evidence.[78] The Respondents provided Ken with extracts of Luen Tat’s ledger, and a one-page summary compiled by their staff.[79] 55.DHCJ To was critical of the Respondents’ conduct in providing to Ken a document compiled by themselves. In so doing, they were not assisting the court or advancing Luen Tat’s interest but were assisting Ken personally.[80] The finding was upheld on appeal.[81] 56.The OR takes the view (which the Respondents accept) that the Respondents’ conduct draws criticisms:
57.The Respondents accept that the provision of documents to Ken gave rise to a perception that the Respondents were biased in favour of Ken. The Respondents accept that they should not have prepared and provided documents in response to a request from Ken in the Main Action.[84] C4. Refusal to forward documents to Commercial Crime Bureau 58.When the Respondents were appointed, they discovered that many records in Luen Tat’s computers had been deleted.[85] The Respondents initially took the view that Ken deleted those computer files.[86] Later, in their report dated 3 May 2013, they concluded that they could not be sure who did it, and no further action was taken.[87] 59.In January 2017, Seline requested the Respondents to forward Luen Tat’s papers to the police to re-open the investigation against Ken. The Respondents refused.[88] 60.DHCJ To criticised the Respondents’ refusal, and held that this was a further example of the Respondents’ bias in favour of Ken and their antagonism against Father’s Camp.[89] Such findings were upheld on appeal.[90] 61.The OR agrees with the findings in the Judgment and the CA Judgment that the Respondent’s conduct gave rise to the perception of bias in favour of Ken. The Respondents accept the OR’s criticisms.[91] C5. Insisting on pursuing legal actions against Father’s Camp 62.The Respondents obtained sanction from the court to commence various actions against Father’s Camp and Yuen Hing which included HCA 1428/2012, HCA 2137/2012 and HCA 220/2015.[92] 63.On 15 November 2013, Father’s Camp obtained an order to stay HCA 1428/2012 and HCA 2137/2012 pending resolution of the Main Action.[93] 64.Instead of respecting the stay order, the Respondents appealed against it. The appeal was heard over a 3-day hearing running in parallel with the trial of the Main Action, and was dismissed on 25 July 2014.[94] 65.DHCJ To held that it was not appropriate for the Respondents to pursue the appeal against the stay order, particularly when the trial of the Main Action was imminent.[95] If Father was successful in the Main Action, he would be the sole beneficial owner of Luen Tat, and there would be no point in continuing the actions.[96] The Judge held that the Respondents pursued the appeal to create work for themselves and/or to put pressure on Father’s Camp, and that gave rise to the perception of bias in favour of Ken.[97] The findings were upheld on appeal.[98] 66.The OR agrees with DHCJ To’s findings that it was not appropriate for the Respondents to pursue the appeal against the stay order when the trial in the Main Action was imminent. The Respondents accept the OR’s criticisms, and accept that they should have waited for judgment in the Main Action, instead of appealing against the stay order.[99] C6. Exaggerating Seline’s non-compliance with production order 67.The Respondents obtained a production order for the purposes of verifying certain PODs. In the Removal Application, and in order to justify their continuation in office, the Respondents alleged that Seline was in breach of the production order, which would not be enforced if the liquidation of Luen Tat was stayed.[100] 68.DHCJ To held, and the Court of Appeal agreed, that the Respondents had exaggerated Seline’s non-compliance with the production order to justify their continued appointment as liquidators.[101] 69.The OR takes the view (and the Respondents accept) that the Respondents exaggerated Seline’s alleged non-compliance for their own interest in order to justify their continued appointment as Luen Tat’s liquidators, rather than furthering the interests of Luen Tat.[102] D. DISQUALIFICATION ORDER 70.As submitted by Ms Tong, the Respondents are officers of the court and are fiduciaries.
71.Ms Tong submits that the Court can be satisfied that the Respondents’ conduct has fallen below the standard of probity and competence one would expect of a liquidator and is sufficiently serious to warrant a disqualification order being made against them (Official Receiver v Wong Ping Kuen, §20) in that:
72.As regards the period of disqualification, Ms Tong submits that:
73.In light of the aforesaid mitigating factors, the OR submits that the length of disqualification should be brought down to the lower end of the middle bracket, and invites the court to grant a disqualification order of 6 years.[111] 74.Mr Maurellet submits that a 6-year disqualification order is appropriate as the present case falls within the lower end of the “middle bracket” for the reasons set out in §§75-81 below. 75.First, a “lack of dishonesty will usually be an important factor which either reduces the seriousness of a case or amounts to a mitigating factor”. The “top bracket” is typically applied to cases characterised by “dishonesty, serious lack of probity or repeat disqualification” (Mithani: Directors’ Disqualification (Issue 103), §1594). 76.The Respondents have no history of previous disqualifications.[112] Nor were there any allegations of dishonesty. Instead, the OR's criticisms focus on the Respondents’:
77.The OR’s criticisms are centred on the Respondents’ self-interested actions and their lack of independence or impartiality. Though such conduct is admittedly unbecoming for independent liquidators, it does not constitute dishonesty or fraud. 78.Second, the low probability of the Respondents’ repeating these failings in future can properly be regarded as a mitigating factor (Re First China Financial Network Holdings Ltd [2015] 5 HKLRD 530, §§22-24). In the present case:
79.Third, the duration of jeopardy faced by the Respondents is a mitigating factor, although no discount would be given if “the respondent was not aware of any possible proceedings hanging over his head” (OR v Philip Tose, HCMP 112/2002, 4 March 2009, §§29, 32).
80.Fourth, “proper co-operation by the defendant will amount to mitigation and may reduce the period of disqualification that might otherwise be imposed against him” (Mithani, §1693). The Respondents showed initiative by:[128] (1) forwarding the Judgment to the OR and highlighting the Judge’s recommendation to reassess their suitability to act; (2) inviting the OR to investigate Luen Tat’s liquidation and undertaking to give full cooperation in the investigations. 81.Fifth, consideration should also be given to the early admission of wrongdoing, particularly if the Carecraft procedure was adopted (Mithani, §1692A(4)(5)). This factor is particularly pertinent here, given that it was the Respondents who first proposed Carecraft resolution.[129] 82.While I accept that the mitigating factors identified by counsel are relevant, they do not warrant the discount proposed by the parties for the following reasons:
83.More importantly, in my view, where as here the office-holders against whom a disqualification order is sought are found to have acted in breach of fiduciary duties, in considering the period of disqualification, the court should consider whether the company has suffered any loss as a result of the breach and, if so, whether the fiduciaries have taken any steps to address and remedy the loss suffered by the company. There are 3 main reasons for this:
84.In the judgment of DHCJ Le Pichon, she noted in §64 and footnote 13 that during the 7 years when they were in office, the Respondents had been “handsomely remunerated” with fees in excess of HK$18 million. However, neither the Statement nor counsel’s submissions have addressed the issue. 85.When this Court raised the question as to whether the Respondents have taken any step to address the loss suffered by Luen Tat, both as regards the remuneration charged and the costs incurred in pursuing the 6 misconduct which DHCJ To found against them, Mr Maurellet refers to ongoing legal proceedings between the Respondents and Father’s Camp in relation to some negligence claim but otherwise does not have any instructions on the issue. Nor has the OR considered the issue. Mr Maurellet submits that given the importance of the issue, the Respondents will file an affidavit to deal with the issue and invites the court to direct evidence to be filed by the Respondents and the OR. 86.In David Yen’s affidavit filed on 8 February 2024, the Respondents provide the following information on the issue:
87.In her 2nd Report filed on 22 February 2024, the OR states that she has no contemporaneous knowledge of the affairs which form the subject matter of these proceedings, and she agrees that the Maxwell principles are relevant. 88.In short, the Respondents have neither paid nor offered to repay the remuneration and the costs paid out of the estate of Luen Tat even though part of the remuneration and costs were charged and incurred by them in relation to least 2 categories of misconduct. 89.In my judgment, not only is a disqualification order against the Respondents amply justified, it is also necessary for the protection of the public. The practitioners and the public should be left in no doubt that the court takes breaches of duties by fiduciaries and office-holders very seriously and will impose a level of penalty commensurate with the gravity of the breaches. In the present case, a disqualification period of 7 years is appropriate given that:
90.I make a disqualification order that the 1st and 2nd Respondents and each of them shall not, without leave of the court,
for a period of 7 years. The order shall take effect on 15 March 2024. 91.As for costs, I make an order that the Respondents do pay the OR’s costs in the agreed sum of HK$2,100,000, to be paid within 28 days of this Judgment.[133]
Ms Sara Tong SC leading Mr Sik Chee Ching, instructed by Official Receiver’s Office, for the Official Receiver Mr Jose Maurellet SC leading Mr Cyrus Chua, instructed by Davis Polk & Wardwell, for the 1st – 2nd Respondents [1] Statement §5. [2] Statement §11. [3] Statement §11. [4] Statement §12. [5] Statement §§13-14. [6] Statement §15. [7] Statement §16. [8] Statement §17. [9] Statement §18. [10] Statement §19. [11] Statement §20. [12] Statement §21. [13] Judgment §132. [14] Statement §22; §§43-104 of Judgment for 6 categories of misconduct. [15] Judgment §§127, 129. [16] Statement §24. [17] Statement §25. [18] Statement §27. [19] Statement §27; DJHC Le Pichon’s Judgment §§63, 66. [20] Statement §28; Recorder Houghton SC’s Decision §34. [21] Statement §28. [22] 1st Report §29. [23] The Respondents’ responses to the OR’s enquiries have been summarized in Sections E1-E6 of the 1st Report. [24] 1st Report §42. [25] 1st Report §§76, 108.4, 108.6. [26] Granted by Masters on 20 December 2022, 21 February 2023, 29 March 2023 and 5 June 2023. [27] Leading Mr Sik Chee Ching. [28] Under s.168G(2). [29] Applied in Re Well Bond Group Ltd [2008] 5 HKLRD 147, §§22-23. [30] Leading Mr Cyrus Chua. [31] Statement §§39, 46, 52. [32] Statement §32. [33] Statement §33. [34] Statement §34. [35] Statement §35. [36] Statement §36. [37] Statement §37; Judgment §§49-51. [38] Judgment §51. [39] CA Judgment §7.16. [40] Statement §38. [41] Statement §38(c); Judgment §51. [42] Statement §38(a). [43] Statement §38(d). [44] Statement §39. [45] Statement §40. [46] Statement §§45(b), 46. [47] Statement §45(d). [48] Statement §44; Judgment §§54, 56. [49] CA Judgment §7.20. The CA noted that DHCJ To had made a mistake on the figures, but that was not a material error. [50] Statement §§41, 42, 45. [51] Statement §46. [52] Statement §47. [53] Statement §48; Judgment §§57-58. [54] Statement §49. [55] Judgment §§57-58. [56] Statement §50; Judgment §59. [57] Statement §50; Judgment §60. [58] CA Judgment §7.26. [59] Statement §§13, 51. [60] Statement §52. [61] Statement §53. [62] Statement §54. [63] Statement §55. [64] Statement §56. [65] Statement §57. [66] Statement §58. [67] Statement §59; Judgment §§68-70, 73. [68] Statement §59; Judgment §§71-72. [69] Statement §60; CA Judgment §7.46. [70] Statement §§61, 62(d). [71] Statement §62(c). [72] Statement §64(a). [73] Statement §64(b). [74] Statement §64(c); Judgment §72. [75] Statement §65. [76] Statement §66. [77] Statement §67. [78] Statement §68. [79] Statement §68. [80] Statement §69; Judgment §§84 – 86. [81] CA Judgment §7.72. [82] Statement §70(c). [83] Statement §§70(a) – (b). [84] Statement §§70(d), 71. [85] Statement §72; Judgment §77. [86] Statement §73; Judgment §77. [87] Statement §74; Judgment §77. [88] Statement §75; Judgment §80. [89] Statement §76; Judgment §80. [90] CA Judgment §7.61. [91] Statement §77. [92] Statement §78. [93] Statement §79. [94] Statement §80. [95] Statement §81; Judgment §§95-96. [96] Statement §81; Judgment §97. [97] Statement §83; Judgment §98. [98] Statement §82. [99] Statement §84. [100] Statement §85. [101] Statement §86; Judgment §§103-104; CA Judgment §7.90. [102] Statement §87. [103] Statement §§22, 24, 27. [104] Statement §§88-90. [105] Statement §§93-94. [106] Statement §92. [107] Statement §95. [108] Statement §96. [109] Statement §97. [110] Statement §§98-99 . [111] Statement §6. [112] Statement §90. [113] Statement §§39, 46, 52. [114] Statement, §65. [115] Statement §87. [116] Statement §70(d). [117] Statement §77. [118] Statement §83. [119] Statement §90; OR Skeleton §78(1)(4). [120] Statement §88. [121] The Respondents clarify that David Yen served as an elected member of the Executive Committee of HKICPA’s Restructuring Insolvency Faculty for 6 years – rather than 12 years, as stated in the Statement §98. The reference to 12 years should be to the period he spent as a member of HKICPA’s cross-border subcommittee. [122] Statement §89. [123] Statement §99. [124] Statement §§88-89. [125] Statement §92. [126] Statement §97. [127] OR Skeleton §78(5). [128] Statement §92; OR Skeleton §78(2). [129] Statement §94; OR Skeleton §78(3). [130] For the purpose of summarizing the progress of the Respondents’ application for release or replacement of liquidators, which the OR considers should be completed before the disqualification order to be made by the court becomes effective. [131] Derived from Mirror Group Newspapers Plc v Maxwell & Others [1998] BCC 324, at 333E-334F, per Ferris J. [132] The amount was stated in the open letter sent by Luen Tat’s solicitors to the Respondents on 1 June 2018 but in the statement of claim, Luen Tat claims damages of HK124 million together with other unquantified damages. [133] Statement §7. | |||||||||||||||||||||||||||||||||||||
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