WONG TAK MAN, STEPHEN AND ANOTHER v. CHEUNG SIU FAI AND ANOTHER

WONG TAK MAN, STEPHEN AND ANOTHER v. CHEUNG SIU FAI AND ANOTHER

The striking out application was dismissed because the trustees' case that the 36 transfers were gifts and therefore transactions at an undervalue under s49 was reasonably arguable; the statutory presumption of insolvency under s51(2) applied to transfers to associates and the respondents failed to rebut that presumption on the material available, so the claim disclosed a reasonable cause of action and was not an abuse of process.

Citation
WONG TAK MAN, STEPHEN AND ANOTHER v. CHEUNG SIU FAI AND ANOTHER
Parties
Applicant (joint and Several Trustees): WONG TAK MAN, STEPHEN and OSMAN MOHAMMED ARAB (The Joint and Several Trustees of the Bankrupt); 1st Respondent (associate; Brother of Bankrupt): CHEUNG SIU FAI (also known as Dickson Cheung); 2nd Respondent (associate; Wife of 1st Respondent): CHEUNG WING MEI (also known as Winnie Cheung)
Court
Court of First Instance
Jurisdiction
Hong Kong
Judgment Date
10 April 2013
Case Number
HCMP1431/2012
Procedural Posture
Bankruptcy Proceedings (sections 49 and 50, Bankruptcy Ordinance) / Application to Strike Out (heard in Chambers); Application Dismissed
Outcome
Respondents' summons to strike out dismissed
Legal Topics
Transactions at Undervalue, Preferences, Presumption of Insolvency (associates), Striking Out Test, Section 49 S51 Bankruptcy Ordinance
Source Language
EN
Bankruptcy Insolvency Civil Procedure Trusts/property Transactions at Undervalue Preferences Presumption of Insolvency (associates) Striking Out Test +1 more

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Parties

WONG TAK MAN, STEPHEN and OSMAN MOHAMMED ARAB (The Joint and Several Trustees of the Bankrupt)

Applicant (joint and Several Trustees)

CHEUNG SIU FAI (also known as Dickson Cheung)

1st Respondent (associate; Brother of Bankrupt)

CHEUNG WING MEI (also known as Winnie Cheung)

2nd Respondent (associate; Wife of 1st Respondent)

Procedural Posture

Bankruptcy Proceedings (sections 49 and 50, Bankruptcy Ordinance) / Application to Strike Out (heard in Chambers); Application Dismissed

Legal Issues

  1. 1 Whether the transfers were transactions at an undervalue under s49 (i.e. gifts)
  2. 2 Whether the transfers were made at a relevant time so as to be vulnerable under s51
  3. 3 Whether the presumption of insolvency under s51(2) applied and had been rebutted

Ratio Decidendi

The striking out application was dismissed because the trustees' case that the 36 transfers were gifts and therefore transactions at an undervalue under s49 was reasonably arguable; the statutory presumption of insolvency under s51(2) applied to transfers to associates and the respondents failed to rebut that presumption on the material available, so the claim disclosed a reasonable cause of action and was not an abuse of process.

Court Disposition

Respondents' summons to strike out dismissed

Orders

  • Respondents' summons dated 14 September 2012 to strike out the trustees' claim in respect of the 36 Transfers is dismissed.