UNIVERSAL ELECTRONICS LTD v. CHAN HOI SHUN AND OTHERS T/A C.Y. SUPPLIES CO

DCCJ 724/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

CIVIL ACTION NO. 724 OF 2008

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BETWEEN
UNIVERSAL ELECTRONICS LIMITED
(聯宇電子有限公司)
Plaintiff
and
CHAN HOI SHUN (陳凱信), NG MUI KUEN (吳梅娟), SHUM MAN KIT (岑文傑) all trading as C.Y. SUPPLIES CO (駿業文儀公司) Defendants

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Coram : Her Honour Judge M. Yuen in Chambers (Open to Public)

Date of Hearing : 17 August 2009

Date of Decision : 17 August 2009

Date of handing down Reasons for Decision : 16 October 2009

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REASONS FOR DECISION

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Application to set aside witness summons

1. The plaintiff has summonsed an officer of the Official Receiver’s Office to produce the documents supplied by a bankrupt personChan Ming Fai to the Official Receiver’s Office for the purpose of the present trial.

2. This was an application by the Official Receiver to set aside the witness summons on the following grounds:-

(a) the summons was oppressive and vexatious as the plaintiff was seeking production of all documents in the possession of the OfficialReceiver in the administration of the bankrupt person; or alternatively

(b) the issuing of the witness summons is an abuse of the court process since the documents obtained by the Official Receiver issecured for the purpose of the administration of the estate of the bankrupt person as opposed to assisting any creditor in the recoveryof its debts.

3. The plaintiff sued the defendant in fraud and conspiracy to defraud. It was the plaintiff’s allegation that Chan Ming Fai, thebankrupt person, has colluded with the defendant in defrauding the plaintiff of its goods when Chan Ming Fai ordered the goods fromthe plaintiff with an intention not to pay. It was the plaintiff’s belief that there were no contracts of sale between Chan MingFai and the defendant in respect of the 12 lots of goods collected by the defendant from the plaintiff. The plaintiff suspected ChanMing Fai and the defendant had conspired to deceive the plaintiff of its goods.

4. The plaintiff acted on Chan Ming Fai’s explanation that all contractual documents had been handed over to the Official Receiverand resolved to call upon the Official Receiver to produce Chan’s documents.

5. It was the plaintiff’s intention to call upon the Official Receiver to produce contractual documents or to confirm there was nowritten contractual document between Chan Ming Fai and the defendant in respect of the purchase of 12 lots of disputed goods.

6. Though the subpoena was worded unhappily wide as requiring the Official Receiver to produce “all documents in the possession ofthe Official Receiver”, it was quite clear from the exchange of correspondence between the plaintiff and the Official Receiverthat the plaintiff was really only looking for the production of documents relating to the 12 lots of disputed goods.

7. The primary duty of the Official Receiver is obviously the administration of the estate of the bankrupt person, but it would beunthinkable for the Official Receiver to be used as a shield against proof of criminal activities.

8. In any event property in those documents rests with the bankrupt person Chan Ming Fai. If there be any need for claim of objectionagainst discovery, that really ought to be claimed by the bankrupt person Chan Ming Fai. The dispute between the plaintiff and theOfficial Receiver about any possible objection to disclosure could easily be resolved by seeking the views of Chan as to whetherthe disclosure was agreed or would be objected to. Should Chan have given his consent to the disclosure of those documents, the presentsetting aside application would have been totally unnecessary. Neither the plaintiff nor the Official Receiver saw fit to consultChan about his view concerning the disclosure of those documents.

9. As the Official Receiver cannot possibly be seen to be someone who assisted the bankrupt to practice fraud against his creditors,I do not see any justification for the discharge of the witness summons.

10. The application to set aside is refused. The Official Receiver is required to provide documents relevant to the present litigation.Since both the plaintiff and the Official Receiver were at fault in failing to consult Chan Ming Fai about any objection on his partto the disclosure of the documents in question, neither the plaintiff nor the Official Receiver should be entitled to the costs ofthis set aside application. There shall be no order for costs on this setting aside application; i.e. each party is to bear its owncosts in the present setting aside application.

11. As the Official Receiver is not a part of the present litigation, the costs of the Official Receiver in attending this trial isto be borne by the plaintiff.

( Mary Yuen )
District Judge

Plaintiff represented by its director, Mr. CHAN Shiu-wah.

Ms. Doris WU, Assistant Principal Solicitor for Official Receiver’s Office.