RE TONG WAI TAK

RE TONG WAI TAK

Acceptance of the debtor's cheque by the petitioner's solicitors initially operated to pay or compound the debt and warranted dismissal of the petition; the fact the debtor later stopped payment constituted a material change of circumstances justifying review under s.98 but did not automatically restore the original order; secured creditors may present petitions under s.6B but the court must assess whether the debtor appears unable to pay and may dismiss if debtor can pay or has reasonable prospect of paying.

Citation
[2023] HKCFI 719
Parties
Petitioner: The Incorporated Owners of Morning Ray Mansion; Debtor: Tong Wai Tak; Official Receiver: Official Receiver
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
9 March 2023
Case Number
HCB3621/2022
Procedural Posture
Bankruptcy Petition and Review Under Bankruptcy Ordinance / Summons Under S.98(1) to Review/rescind Order Dismissing Petition (adjourned Hearing)
Outcome
Summons adjourned to 23 March 2023; if debt paid before that date summons will be dismissed; if debt remains unpaid the earlier order dismissing the petition will be rescinded and a bankruptcy order will be made against the debtor.
Legal Topics
Statutory Demand, Charging Order, Bankruptcy Petition, Rescission/review of Orders S.98, Secured Creditor Election (s.6 B), Ability to Pay (s.6 A), Compounding/payment by Cheque, Costs Assessment
Source Language
EN
Bankruptcy Law Insolvency Civil Procedure Property Security Costs Law Statutory Demand Charging Order Bankruptcy Petition +5 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 6 Authorities cited 9 Party arguments 2 Amounts and remedies 4
Sign in to unlock

Parties

The Incorporated Owners of Morning Ray Mansion

Petitioner

Tong Wai Tak

Debtor

Official Receiver

Official Receiver

Procedural Posture

Bankruptcy Petition and Review Under Bankruptcy Ordinance / Summons Under S.98(1) to Review/rescind Order Dismissing Petition (adjourned Hearing)

Legal Issues

  1. 1 Whether a secured creditor must first enforce its security before presenting a bankruptcy petition
  2. 2 Whether acceptance of a cheque constituted payment or compounding such that the petition could not succeed
  3. 3 Whether the debtor appeared unable to pay the debt for purposes of s.6 and s.6A

Ratio Decidendi

Acceptance of the debtor's cheque by the petitioner's solicitors initially operated to pay or compound the debt and warranted dismissal of the petition; the fact the debtor later stopped payment constituted a material change of circumstances justifying review under s.98 but did not automatically restore the original order; secured creditors may present petitions under s.6B but the court must assess whether the debtor appears unable to pay and may dismiss if debtor can pay or has reasonable prospect of paying.

Court Disposition

Summons adjourned to 23 March 2023; if debt paid before that date summons will be dismissed; if debt remains unpaid the earlier order dismissing the petition will be rescinded and a bankruptcy order will be made against the debtor.

Orders

  • Summons under s.98(1) adjourned to 23 March 2023 at 9:30am
  • If debtor pays the debt before the hearing on 23 March 2023 the Summons will be dismissed