DARACH E. HAUGHEY AND ANOTHER v. LAM WAI PING STELLA AND OTHERS

DARACH E. HAUGHEY AND ANOTHER v. LAM WAI PING STELLA AND OTHERS

The court found on the balance of probabilities that the bankrupt deliberately transferred funds to the 1st respondent and caused acquisition through Irving with the intention of placing assets beyond his creditors; those transfers (HK$3,583,600 and HK$7,470,600 applied to Park Place, and US$2,000,000 to Grainger) were gifts/transactions at an undervalue under s 49 and are void against the Trustees, entitling Trustees to repayment and to the net sale proceeds of Park Place.

Citation
DARACH E. HAUGHEY AND ANOTHER v. LAM WAI PING STELLA AND OTHERS
Parties
Applicants (joint and Several Trustees): Darrach E. Haughey and Lai Kar Yan (Derek); Bankrupt: William Henry Woo; 1st Respondent: Lam Wai Ping Stella also known as Stella Woo; 2nd Respondent: Irving Developments Limited; 3rd Respondent: Grainger Resources Limited
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
11 May 2005
Case Number
HCB276/2002
Procedural Posture
Bankruptcy (court of First Instance) / Judgment (11 May 2005)
Outcome
Declarations made that specified payments were transactions at an undervalue and void as against the Trustees; orders for repayment and payment of sale proceeds; costs ordered nisi.
Legal Topics
Transaction at an Undervalue, Presumption of Advancement, Voidable Transactions, Recovery of Proceeds, Mareva Injunction
Source Language
EN
Bankruptcy/insolvency Trusts Property Law Civil Procedure Transaction at an Undervalue Presumption of Advancement Voidable Transactions Recovery of Proceeds +1 more

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Parties

Darrach E. Haughey and Lai Kar Yan (Derek)

Applicants (joint and Several Trustees)

William Henry Woo

Bankrupt

Lam Wai Ping Stella also known as Stella Woo

1st Respondent

Irving Developments Limited

2nd Respondent

Grainger Resources Limited

3rd Respondent

Procedural Posture

Bankruptcy (court of First Instance) / Judgment (11 May 2005)

Legal Issues

  1. 1 Whether the payments from the bankrupt to the 1st respondent and to Grainger constituted transactions at an undervalue under s 49 Bankruptcy Ordinance
  2. 2 Whether funds in the 1st respondent's account were gifts or held on trust for the bankrupt
  3. 3 Whether the recipients (1st respondent, Irving, Grainger) are liable to repay sums or hand over proceeds

Ratio Decidendi

The court found on the balance of probabilities that the bankrupt deliberately transferred funds to the 1st respondent and caused acquisition through Irving with the intention of placing assets beyond his creditors; those transfers (HK$3,583,600 and HK$7,470,600 applied to Park Place, and US$2,000,000 to Grainger) were gifts/transactions at an undervalue under s 49 and are void against the Trustees, entitling Trustees to repayment and to the net sale proceeds of Park Place.

Court Disposition

Declarations made that specified payments were transactions at an undervalue and void as against the Trustees; orders for repayment and payment of sale proceeds; costs ordered nisi.

Orders

  • Declaration that HK$3,583,600 received by the 1st Respondent on 8 February 2000 and applied to Park Place was a transaction at an undervalue under s 49 and void against the Trustees
  • Declaration that HK$7,470,600 received by the 1st Respondent as part of US$4,000,000 on 15 February 2000 and applied to Park Place was a transaction at an undervalue under s 49 and void against the Trustees