GEORGE CHEN SHENG LIANG v. L.S. SHUM TRUSTEE OF THE PROPERTY OF THE ABOVE-NAMED BANKRUPT AND ANOTHER

GEORGE CHEN SHENG LIANG v. L.S. SHUM TRUSTEE OF THE PROPERTY OF THE ABOVE-NAMED BANKRUPT AND ANOTHER

The court found on the evidence that the parties had a financing/quasi‑partnership relationship rather than a straightforward creditor‑debtor relationship; accordingly the second respondent's claim was deferred/unsustainable as a provable debt and the proof of debt admitted for dividend was expunged.

Source-derived case information.

Citation
GEORGE CHEN SHENG LIANG v. L.S. SHUM TRUSTEE OF THE PROPERTY OF THE ABOVE-NAMED BANKRUPT AND ANOTHER
Parties
Applicant (creditor): Tak Ming Company Limited; 1st Respondent (trustee): L.S. Shum (Trustee/Official Receiver); 2nd Respondent (creditor): Van Shung Chong Hong
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
16 June 1970
Case Number
HCB31/1967
Procedural Posture
Bankruptcy (in Bankruptcy) / Application to Expunge Proof of Debt Following Admission for Dividend; Hearing and Cross Examination of Affidavits
Outcome
Application allowed. Proof of debt of the second respondent expunged; applicant awarded costs against the second respondent; Official Receiver's costs to be paid out of the estate.
Legal Topics
Proof of Debt, Expungement, Quasi Partnership, Financing of Business, Re Beale Principle, Trustee Administration, Dividend Distribution
Source Language
en
Bankruptcy Insolvency Commercial Law Partnership/quasi‑partnership Evidence Proof of Debt Expungement Quasi Partnership +4 more

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Parties

Tak Ming Company Limited

Applicant (creditor)

L.S. Shum (Trustee/Official Receiver)

1st Respondent (trustee)

Van Shung Chong Hong

2nd Respondent (creditor)

Procedural Posture

Bankruptcy (in Bankruptcy) / Application to Expunge Proof of Debt Following Admission for Dividend; Hearing and Cross Examination of Affidavits

Legal Issues

  1. 1 Whether the evidence established that the bankrupt owed the claimed debt to the second respondent
  2. 2 Whether the relationship between the bankrupt/Wood & Co. and the second respondent was creditor-debtor or a financing/quasi‑partnership arrangement (affecting priority)
  3. 3 Whether the proof of debt admitted for dividend should be expunged

Ratio Decidendi

The court found on the evidence that the parties had a financing/quasi‑partnership relationship rather than a straightforward creditor‑debtor relationship; accordingly the second respondent's claim was deferred/unsustainable as a provable debt and the proof of debt admitted for dividend was expunged.

Court Disposition

Application allowed. Proof of debt of the second respondent expunged; applicant awarded costs against the second respondent; Official Receiver's costs to be paid out of the estate.

Orders

  • The proof of debt lodged by Van Shung Chong Hong on 27 July 1968 and admitted for dividend on 17 September 1969 is expunged.
  • Tak Ming Company Limited to have its costs to be paid by Van Shung Chong Hong.