The Joint & Several Liquidators of Kong Wah Holdings Ltd (in Compulsory Liquidation) v. [Respondents]

HCCW 49/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 49 OF 2000

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BETWEEN

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AND

HCCW 50/2000

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

COMPANIES (WINDING-UP) NO. 50 OF 2000

______________________

______________________

BETWEEN

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(Heard together)

Before : Hon. Kwan J. in Chambers (not open to public)

Date of Hearing : 21 July 2006

Date of Decision : 21 July 2006

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D E C I S I O N

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1.This is a summons issued by the liquidators of Akai Holdings Limited and Kong Wah Holdings Limited (collectively “the Companies”) on 6 June 2006 under section 221 of the Companies Ordinance, Cap. 32 against [examinee] (“the respondent”).

2.On 7 June 2006, I gave leave to serve the summons on the respondent out of the jurisdiction.  The respondent resides at all times in Canada.  I gather from the affidavit of the process server that attempts were made to serve the respondent personally but he refused to accept personal service.  As a result, the documents were left outside his residence.

3.I am satisfied that the summons and the supporting affidavit should have come to the respondent’s attention and that all reasonable efforts have been made to serve him the papers.

4.In their summons, the liquidators seek an order that the respondent be examined on oath before a Master of the High Court in Hong Kong concerning the affairs and/or dealings of the Companies, their subsidiaries or associated companies.  If the respondent is prepared to come to Hong Kong, the examination will take place in Hong Kong.  In the event he is not prepared to come to Hong Kong, the liquidators seek an order that a letter of request addressed to the Superior Court of Justice of Ontario, Canada be issued in respect of the respondent so that he would be examined before the judicial authorities in Canada.

5.The liquidators also seek an order that the respondent do deliver and produce to them any and all books, records, documents, correspondence and/or papers in his possession, custody or control relating to the Companies, their associates or subsidiaries.

6.The respondent is the owner of a garment business in Canada.  He was one of only [no.] independent, [position] of, [company], serving from June 1994 to 23 August 2000, when [situation].  He was also one of the [no.] [position] appointed to the [group] of [company].  The [group] convened at least 2 meetings a year.

7.The liquidators are investigating a number of significant transactions including the disposal of substantial assets of the Companies within the period when the respondent served as [position] of [company].  A summary of these transactions was set out in paragraph 10 of the 26^th affidavit of Mr Borrelli, one of the liquidators.

8.Given the respondent’s position, the liquidators believe that he should be in a position to materially assist them in advancing their investigations.

9.Correspondence between the liquidators, their legal advisers and the respondent from August 2000 to March 2006 was exhibited.  The liquidators have been trying to contact the respondent since August 2000 to enlist his assistance.  The respondent informed the liquidators in September 2001 that he did not have books and records of the Companies and he never had possession of such books or records and that he had never been involved in any of the business activities of the Companies and had no knowledge or participation in any activities leading to the current state of the Companies.

10.Further letters were sent by the liquidators but the respondent made no response to their request for a meeting.  The liquidators consider that the respondent should be able to provide information in at least the areas set out in paragraph 19 of Mr Borrelli’s affidavit and wish to examine him, notwithstanding the respondent’s claim of lack of knowledge or participation.

11.Having regard to the position held by the respondent in [company] and that he had served on the [group], I am inclined to agree with the liquidators that they have made out a reasonable requirement to examine the respondent.  So I will make an order that he be examined orally.

12.As for the order sought for the production of documents, I am also persuaded that an order should be made.  If the respondent has indeed no documents of any kind relating to the Companies, their associates or subsidiaries, all that he is required to do is to confirm to the liquidators that he has no such document in his possession, custody or control.

13.For these reasons, I will make an order in terms of paragraphs 1 to 5 of the liquidators’ summons.

Mr Chris Dobby of Messrs Johnson, Stokes & Master, for the Joint & Several Liquidators

The respondent : absent