Ontario Finance & Investment Co Ltd v. Chan Ho Ching t/a Ming Tai Co and Another
Read the full judgment text of HCA 2228/1977 on BabelCite. This High Court CFI judgment was delivered on 24 November 1977.
1. On the 27th August, 1977, judgment was granted against the 1st and 2nd defendants in the sum of $25,000 together with interest and fixed cost. The judgment debtor, Mr. CHAN Ho-ching, was the sole proprietor of the 1st defendant firm and a partner of the 2nd defendant firm. This is his application for a discharge from the Victoria Remand Centre in which he is being detained at the instigation of the plaintiff company in execution of the $25,000 judgment.
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HCA002228/1977
IN THE SUPREME COURT OF HONG KONG HIGH COURT -----------------
----------------- Coram: Mr. Commissioner Liu, Q.C. in Chambers. Date of Judgment: 24 November 1977 ----------------- DECISION ----------------- 1. On the 27th August, 1977, judgment was granted against the 1st and 2nd defendants in the sum of $25,000 together with interest and fixed cost. The judgment debtor, Mr. CHAN Ho-ching, was the sole proprietor of the 1st defendant firm and a partner of the 2nd defendant firm. This is his application for a discharge from the Victoria Remand Centre in which he is being detained at the instigation of the plaintiff company in execution of the $25,000 judgment. 2. In an application for a discharge, "in order to succeed the creditor shall make proof that the judgment debtor's inability to satisfy the judgment is attributable to unjustifiable extravagance in living or that the judgment debtor, for the purpose of avoiding payment of the debt, wilfully concealed property, or his right or interest therein, or fraudulently transferred or removed property, or committed any other act of had faith". 3. At the hearing before me this morning, the judgment debtor offered himself for cross-examination which was rigorously prosecuted. It transpired from such cross-examination that in or about the middle of August, 1977 shortly before the commencement of the present action, Mr. Chan caused to be transferred the business interest and tenancy right of his Ming Tai Company to a newly incorporated limited company of the same name, Ming Tai Building Materials Supplier Limited. I am invited by the solicitor for the judgment creditor to infer from the company name that the business of the limited company and that of Ming Tai Company before is and was that of a supplier of building materials. I can find no justification to draw that inference. 4. It also transpired that shortly before the commencement of the present action but after the judgment debt of $25,000 had accrued to the judgment creditor from the 1st and 2nd defendants, the judgment debtor caused negotiation to be conducted with his creditors. The judgment debtor testified that negotiation and the proposed arrangement with his creditors in general were left in the hands of the present shareholders of the Ming Tai Building Materials Supplier Limited but that he had duly briefed persons responsible in the new company on all his creditors. 5. As a result of the negotiation, a sum of a little over $20,000 was paid by the limited company in settlement of his debts. The judgment debtor stated in cross-examination that he was left in the dark as to which of his creditors had been paid. 6. We know not the reason for the transfer of all these rights and interests to the new limited company nor the circumstances which brought about such a transfer. We are quite unaware if at all pressure to bear had been put on the judgment debtor. In fact, we are, as we were, uninformed after cross-examination as to what intention the judgment debtor entertained, what the transfer was designed to achieve and whether assets including goodwill of the Ming Tai Company were taken over by the new limited company at arm's length. 7. The judgment debtor has been engaged in the new limited company for a pay of $1,300 per month, and all of the shareholders in the new limited company have their own occupation. I am urged to find from these surrounding circumstances that the judgment debtor must have been left in charge and must have retained de facto control of the business activities. The evidence, in my view, does not warrant that conclusion, but I should hasten to add that the circumstances are not entirely free from suspicion. 8. There is no burden for the judgment debtor to discharge. It is for the judgment creditor the make proof of the matters set out in Order 49B Rule 6(3). Suffice it for me to say that after cross-examination we have just as little information of the judgment debtor's activities as we hitherto possessed. The judgment creditor must make proof in order to avail itself of this stringent for keeping the judgment debtor in incarceration for the rest of the year to come. 9. In the circumstances, I am compelled to say that the judgment creditor has not succeeded in proving any of the matters required of it and that the judgment debtor must therefore be discharged forthwith. I order accordingly.
Representation: Mr. K.W. Ng of Messrs. LAU & Co. for Plaintiff/judgment creditor. 1st Defendant/Judgment debtor in person. |