Re Lee Ming Cheung, ex p Mok Ka Po  2 HKLRD 76
Vincent Chen appeared for the debtor in the Court of First Instance in Re Lee Ming Cheung, ex p Mok Ka Po  2 HKLRD 76.
M entrusted her money to L to invest in Hong Kong stocks on her behalf. Subsequently, L was instructed to liquidate the stock portfolio and to repay the total value of the invested stocks and accrued dividends to M. Despite promising to repay the same and repeated demands, L had failed to do so save for a partial payment of $40,000 and a cheque for $200,000 which was dishonoured. M issued a statutory demand against L for $4,676,284.31 which represented the outstanding investment proceeds (the Debt). M’s solicitors made various attempts to effect personal service of the statutory demand on L at his last known address, and by calling L on his mobile telephone (the Calls), to no avail. They then effected substituted service and M presented a bankruptcy petition against L based on the unsatisfied statutory demand. L applied unsuccessfully to set aside the statutory demand. L filed a notice of appeal against the Judge’s decision and now sought to adjourn or stay the bankruptcy petition pending the determination of his appeal. L’s grounds of appeal were that the Judge erred in: (i) holding that M had done all that was reasonable for the purpose of bringing the statutory demand to L’s attention, and that L was aware of the statutory demand, when M should have used other electronic means of communication to bring the statutory demand to L’s attention, such as by WhatsApp messages or e-mails; and (ii) rejecting L’s argument that the debt was not a liquidated sum capable of founding the statutory demand, but one against him as a trustee for breach of trust.
Held, dismissing the application, that:
(1) L had failed to demonstrate that the appeal was arguable and so there was no basis for the Court to exercise its discretion to stay the petition. (See paras.9, 38.)
(2) Absent any evidence from L other than his bare denial of ever having received the Calls, and given the contemporaneous evidence adduced concerning the Calls, L’s argument that there was no proper service of the statutory demand was not remotely arguable. L did not deny that the number called was his mobile number and there was no evidence that when the Calls were made, he did not have access to his telephone or could not have answered it. The Judge also found that L and M’s relationship had broken down before the statutory demand was issued. (See paras.22-25.)
(3) L’s argument that the petitioning debt was not a debt or a liquidated claim was also rightly rejected by the Judge, given L’s own admission and acknowledgment that the sum was due and payable, and the finding by the Judge that the petitioning debt was a claim for investment proceeds held on trust, which were capable of being ascertained as a mere matter of arithmetic, based on the market data of the relevant shares. (See paras.33-37.)
[The above headnote is taken from HKLRD]