RE MAN KWOK SHING

RE MAN KWOK SHING

The court found no proven material variation: the sale proceeds remained trust money and the bank did not permit a variation that discharged the guarantors; alternatively, even if a variation occurred it fell within the wide protective scope of clause 3.05 of the Guarantee, so the guarantors were not discharged; accordingly the petitions succeeded and bankruptcy orders were made against each debtor.

Citation
RE MAN KWOK SHING
Parties
Petitioner: Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. Hong Kong Branch trading as Rabobank, Hong Kong Branch; Debtor: Man Kwok Shing; Debtor: Leung Siu Chung Henry; Debtor: Kwan Pak Hin Henry; Official Receiver: Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
26 November 2002
Case Number
HCB10375/2002
Procedural Posture
Creditor's Bankruptcy Petition (bankruptcy Proceedings) / Judgment
Outcome
Bankruptcy orders made against each debtor; order nisi for costs in favour of the petitioner to be made absolute after 14 days
Legal Topics
Statutory Demand, Personal Guarantee, Material Variation of Contract, Trust Receipt, Banking Facilities, Protective Clause in Guarantee, Admissibility of Expert Evidence, Order Nisi for Costs
Source Language
EN
Bankruptcy Contract Suretyship Trusts Banking Law Statutory Demand Personal Guarantee Material Variation of Contract +5 more

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Parties

Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A. Hong Kong Branch trading as Rabobank, Hong Kong Branch

Petitioner

Man Kwok Shing

Debtor

Leung Siu Chung Henry

Debtor

Kwan Pak Hin Henry

Debtor

Official Receiver

Official Receiver

Procedural Posture

Creditor's Bankruptcy Petition (bankruptcy Proceedings) / Judgment

Legal Issues

  1. 1 Whether the bank's conduct amounted to a material variation of the Facilities Letter discharging the guarantors
  2. 2 Whether the trust receipt proceeds ceased to be trust money and converted secured debt into unsecured debt
  3. 3 Whether clause 3.05 of the Guarantee protected the bank from discharge of the guarantors

Ratio Decidendi

The court found no proven material variation: the sale proceeds remained trust money and the bank did not permit a variation that discharged the guarantors; alternatively, even if a variation occurred it fell within the wide protective scope of clause 3.05 of the Guarantee, so the guarantors were not discharged; accordingly the petitions succeeded and bankruptcy orders were made against each debtor.

Court Disposition

Bankruptcy orders made against each debtor; order nisi for costs in favour of the petitioner to be made absolute after 14 days

Orders

  • Bankruptcy order made against Man Kwok Shing (HCB10375/2002)
  • Bankruptcy order made against Leung Siu Chung Henry (HCB10379/2002)