WONG LUEN HANG AND ANOTHER v. CHAN YUK LUNG AND ANOTHER

WONG LUEN HANG AND ANOTHER v. CHAN YUK LUNG AND ANOTHER

Defendants were guilty of civil contempt because they failed to comply with the 3rd Orders and the recorded Undertaking by not producing required accounting and supporting documents and by delaying the auditors' accounting adjustments; the requisite mental element was established by attributed knowledge through agents and by defendants' own admissions; penal notices and substituted service were valid and did not defeat committal; sentencing was reserved and indemnity costs ordered nisi.

Citation
[2023] HKCFI 304
Parties
1st Plaintiff: Wong Luen Hang; 2nd Plaintiff: Tsui Kwok So; 1st Defendant: Chan Yuk Lung; 2nd Defendant: Chan Yuk Wai
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
2 February 2023
Case Number
HCMP243/2021
Procedural Posture
Committal for Civil Contempt Arising From Non‑compliance With Inspection Orders and an Undertaking to the Court / Liability Determined; Sentencing Reserved (further Hearing Fixed for Sentencing)
Outcome
Defendants found guilty of civil contempt for breach of the 3rd Orders and the recorded undertaking; sentencing reserved for further hearing
Legal Topics
Committal, Contempt, Inspection Orders, Undertaking to Court, Service of Orders, Penal Notice, Vicarious Liability, Costs (indemnity)
Source Language
EN
Civil Procedure Contempt of Court Company Law Evidence Committal Contempt Inspection Orders Undertaking to Court +4 more

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Parties

Wong Luen Hang

1st Plaintiff

Tsui Kwok So

2nd Plaintiff

Chan Yuk Lung

1st Defendant

Chan Yuk Wai

2nd Defendant

Procedural Posture

Committal for Civil Contempt Arising From Non‑compliance With Inspection Orders and an Undertaking to the Court / Liability Determined; Sentencing Reserved (further Hearing Fixed for Sentencing)

Legal Issues

  1. 1 Whether defendants breached the 3rd Orders and the recorded undertaking to instruct auditors to make accounting adjustments
  2. 2 Whether defendants had the requisite mental element (knowledge of facts making non‑compliance a breach) for civil contempt
  3. 3 Whether substituted service and the form/placement of penal notices invalidated committal

Ratio Decidendi

Defendants were guilty of civil contempt because they failed to comply with the 3rd Orders and the recorded Undertaking by not producing required accounting and supporting documents and by delaying the auditors' accounting adjustments; the requisite mental element was established by attributed knowledge through agents and by defendants' own admissions; penal notices and substituted service were valid and did not defeat committal; sentencing was reserved and indemnity costs ordered nisi.

Court Disposition

Defendants found guilty of civil contempt for breach of the 3rd Orders and the recorded undertaking; sentencing reserved for further hearing

Orders

  • Liberty to parties to fix a sentencing hearing with 3 hours reserved
  • Costs order nisi: defendants to pay costs of and occasioned by the committal applications and contempt proceedings on an indemnity basis, to be taxed if not agreed