Michael Ma Wing v. Fong Sze Ming

IN THE COURT OF APPEAL

1987, No. 72
(Civil)

BETWEEN

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Coram: Hon. Cons, V.-P., Fuad & Clough, JJ.A

Date of hearing: 30^th December, 1987

Date of delivery: 30^th December, 1987

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DECISION

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Cons, V.-P.:

1. The background to the very unusual position in which we find ourselves today is well known to everybody in court and can be found otherwise in the judgment we gave on the 11^th of this month. Very briefly put it is that a Mr. Ma had been adjudicated bankrupt on a petition presented by a Mr. Fong. The petition was based on a judgment debt in favour of Mr. Fong, to the extent, I think, of some $35 million. We subsequently took the view that the petition had never been properly served.

2. Two years later, alleging that to be the fact, Mr. Ma applied to the court below to have the Petition, the Receiving Order and the Order of Adjudication all set aside. As far as the Petition was concerned, that question was, so we were told last time, put on one side by the agreement of all parties and has yet to be dealt with. As to the other two orders, the judge below refused to set them aside.

3. On the 11^th December we came to the conclusion, with all respect to him, that he was wrong. We indicated then that we would allow the appeal, but made no further order, adjourning the hearing to a date to be fixed, - which eventually became today, - to hear submissions as to what precise orders would be appropriate.

4. Section 33(2) of the Bankruptcy Ordinance, Cap. 6 reads as follows –

“(2) Where an order is made under this section rescinding a receiving order or annulling an adjudication, all sales and dispositions of property and payments duly made, and all acts theretofore done, by the Official Receiver, trustee or other person acting under their authority, or by the court, shall be valid, but the property of the debtor, if he has been adjudged bankrupt, shall vest in such person as the court may appoint, or in default of any such appointment revert to the debtor for all his estate or interest therein on such terms and subject to such conditions, if any, as the court may declare by order.”

During the course of the hearing counsel for Mr. Ma had conceded that if we should come to a conclusion in his favour an order under the subsection ought to be made.

5. Since then, so we understand, counsel have come to an agreement that two questions should be remitted to the judge below: 1. whether the Petition should be dismissed or not; we interpose, as we mentioned earlier, that the Petition has not as yet come before this court; and 2. what orders or directions should be made under Section 33(2). Today, after discussion, further consent orders have been suggested, but with every respect, none of them are in our opinion suitable in the circumstances.

6. Furthermore, two Notices of Motion have been issued. The first, which was made returnable today, asks for a stay of all proceedings consequent upon our judgment until either leave is given to appeal to Her Majesty in Council and the appeal has been heard, until the Official Receiver has been appointed as interim receiver of Mr. Ma’s estate or alternatively until service of the Petiton pursuant to directions to be given by the judge below shall have been effected.

7. The second Notice of Motion contains, as we have just implied, an application for leave to appeal to Her Majesty in Council. It is returnable on the 6^th January, but application is made to bring it forward to today. Counsel for Mr. Ma objects on the grounds that he has no instructions to deal with it and that the notice is too short.

8. In our view the three matters thus raised are so inextricably intertwined that they cannot properly be dealt with one by one and that the only feasible course to take in the circumstances is to adjourn today’s hearing of the appeal, and the application for a stay, until the 6^th January and then take both together with the application for leave to appeal to Her Majesty in Council. We regret that counsel for Mr. Fong may find himself in difficulties on that day, but we feel it important that these matters be disposed of.

9. We would like to mention that the power of the Court under Section 13 of the Ordinance to appoint an interim receiver once a petition has been presented may perhaps be a consideration in our deliberations. We would be grateful for the assistance of counsel in that respect at the resumed hearing.

K.H. Woo, Q.C. & Miss Carlye Chu (M/s Edmund W.H. Chow & Co.) for Bankrupt/Appellant

John Swaine, Q.C. & Ruy Barretto (M.s John Ip & Co.) for Petitoner/Respondent

Aarif Barma for Official Receiver