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378
His Lordship-In original sotion 196. on an amended writ, judgment was given against two of them.
Mr. Dixon-My client tells me there was no partnership between himself and the plaintiff with regard to the monies which are the subject matter of this charge of embezzlement.
His Lordship - If you had told me that before I shouldn't have called for an amendment.
Mr. Dixon-I suggested it before. His Lordship-Perhaps you will say he is not a defendant next?
Mr. Dizon-Apart from that question will you consider the case?
His Lordship—I will consider it and reserve that point.
Mr. Lang submitted he bad nothing to prove, hat on his Lordship's suggestion read the statements of claim and defence, the latter denying that plaintiff and defendant were partners in the action.
His Lordsbip-You're got to prove that. You had better put your client in the box.
Mr. Lang-He's not here. His Lordship-Well, that being the case I'll give you Thursday morning.
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THE HONGKONG WEEKLY PRESS AND
witness box. I am not at all surprised that the Trustee should have found him so upset as to be unable to give any coherent account of himself or his affairs. This judgment will dispose of some of those errors; but there is one final set of errors said to have been committed by the debtor and those who allege themselves to be his creditors
which will have to be unravelled hereafter. Further, and as it were to complete the chain of error, I have the misfortune to take a view of the law applicable to the debtor's motion to discharge the order I made ex parte, which beither Counsel engaged in the cass felt them. selves able to support Having given the matter very careful consideration I have coma to the conclusion, for reasons which I will presently state, that a judgment creditor is not a secured creditor except in some special cases. I must work out the consequences of my view myself, and give judgment accordingly. But as it is perfectly possible that either party may feel aggrieved by this view, and may wish to appeal, I think it advisable to decide the points involved as they were argued. First, then, I will assume that a judgment creditor who has obtain- ed a prohibitory order is a secured creditor. Mr. Ho Tung having on 25th Jane, 1906, obtained a judgment, and on 29th June, 1906, obtained a probibitory order, when he came to prove his claim in the debtor's bankruptcy, swere on the usual unsecured cerditor's form that he held no security, the fact that he was a secured creditor to the extent of the value of the property attached having gone out of his mind. It also escaped the recollection of his solicitor. From this mistake he sought to be relieve, on the ground of inadvertence. This application was made to me ea parte and the Trustee consenting. I made the order, which the debtor now seeks BEFORE MR. A. G. WISE (PUISNE JUDGE). to set aside. The inadvertence of the solicitor
Mr. Dixon-I should like to raise another point: that is, with reference to my friend having failed to give notice in writing of this intended action for false imprisonment.
His Lordship-I'll consider that point too. Yon (Mr. Lang) might consider these points, and you must have your client here on Thurs day as there are three things you've got to prove or else you don't get your case.
Wednesday, November 28th.
IN ORIGINAL JURISDICTION.
PROTRACTED LITIGATION.
In the action Chan Wo, who possesses severa
aliases, and others against Chan Yam and others Mr. H. E. Pollock, (instructed by Mr. C. P. Dixon, from the office of Mr. J. Hastings) appeared for plaintiffs and Mr. M. W. Slade (instructed by Mr. F. P. Hett of Messrs. Bratton and Hett) appeared for defendants.
Mr. Pollock stated that the plaintiffs' claim was for $4,258. a portion of a sum of moneys which were paid by a man called Mai Chan in settlement of Original action 73 of 1896 and 48 of 1897. In the former action the Wa Hing Leang firm obtained judgment against the Wa Tai firm for $7.127. Consequent on that judgment and with a view to enforcing it. the Wa Hing Loung attached through the British Consul at Canton and through the Chinese anthorities certain properties belonging to Mui Chan in satisfaction of that debt on the ground that he was a partner in that firm.
a counterblast Mui Chan brought the action 48 of 1897 against the Wa Hing Leung, asking for an injunction and $15,000 damages in respect of the attachment of his property, asserting that the attachment had been obtained by some false representation. A considerable time afterwards, in October 1903, the two actions were settled by Mui Chan paying into Mr. rutton's hands the sum of $12,000. While the amount at stake in the present action was not large, the principle question was the terms of the agreement come to between the plaintiff and the retiring partner of the Wa Hing Lenng.
should it become necessary.
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being sworn to. I am willing to accept it so far as he is concerned: though the debtor is justified in reserving the right to ask for further evidence of the inadvertence of Mr. Ho Tung himself that I take of the consequences of the mistake. But in the view
it is unnecessary to go into this question for be is not entitled to relief if his proof as an unsecured creditor has been prejudicial to the debtor, though I am bound to say I do not find the law applicable to the particular circumstances of this case very clear in the cases cited. In sxp. Clarke re Burr (47 L. T. 232) the Judge undoubtedly lays down this principle: that a creditor who has voted and omitted to value his security ought always to be allowed to withdraw his proof, and to be relived from being seemed to have surrendered his security unless he has elected really to abandon his security: that is, unless he has omitted to do that which he eid omit, deliberately, and on purpose. ought, on sneh terms as the Court may think If it has been done accidentally, he fit to impose, to be relieved from the loss of his security. In that case it is true the creditor had vot d, but his vote seems to have had no influence on the result of the meeting one way or another; and thi being so, the principle is easy to be understood. This case seems to lay stress on the necessity of the creditor having acted advertently. But in re Safety Explosives Co. (1904 Ch. at p. 235) the same learned Judge, then L. J. Vaughan Williams, said that it was not disputed that an amendment of a proof ought not to be allowed if the position of the parties has been altered since it was put upon the file; and the same principle is alluded to in the judgment of North J. in re Lealer exp. Huddersfield Bank. There also the creditor had voted; and the learned Judge said
Ndoubt
he might by his vote bave succeeded in so altering the position of the Company that it would be unfair to say that he should be released from giving up what he bas given up in consideration of securing the advantage which he had got by his vote. I do not find the vote really came to anything. The vote he gave did not alter the position of things so as to entitle the creditors to hold him to the vote The unfortunate debtor in this case has
for that reason." So it is clear that even if there been the victim of a perfect Comedy of has been inadvertence, if the effect of the vote Errors. Up to the time of judgment in the has ben to alter the debtor's position, the setion brought by Mr. Ho Tung against him, creditor will be held to it: with the result that the errors were of his own making: Since he will be held to have abandoned his security: then thay have been made by his opponents: but I am disposed to add "unless things can be and, having already seen the man in the 'put straight." Now let us see what happened in
Mr. Pollock then called witnesses who gave evidence as to the agreement.
Thursday, November 29th.
In Bankruptcy JURISDICTION.
BEFORE THE CHIEF JUSTICE (BIB
FRANCIS PIGGOTT.)
CHUNG SHUN KOO'S BANKRUPTCY,
His Lordship gave judgment in the series of motions concerning the bankruptcy of Chung Shun Koo as follow8 :—
[ December 1, 1906. -
this case. If Mr. Ho Tang had voted at the creditor's meeting for his debt, less his estimated value of his security, the special resolution would have been passed. The figures are inolu. siva on this point. As to this there is a point in the procedure which was adopted by the Official Receiver, which I think needs improve- ment. He wrote on the minutes of the meeting ......“ Regolved as follows: Mr. S. Bisney, proxy for Mr. Ho Tung dissanting, that the debtor's proposal for a composition credit set forth above be accepte l This looks, and both Counsel for Ho Tung and I. at first, thought this meant that the resolution having been adopted, the condition of 8, 18 (1) had been fulfilled, and that this was a *4 special resolution." Bat it was not. In order to be a 'special resolution,' it must be voted by three fourths in number an i valus of tho e present and “entitled to vote." Thi‹ condition wis not satisfied, some of the claims having been disallowed for the purpose of voting. because the creditors were not present either ia person or by proxy. Bat it would have been satisfied if Mr. Ho Tane had not voted for thi fall amount of his debt. He has, therefore, by his vote prevented the special resolution from being. passed. With regard to the Offcial Roo «iver's procedure I think it would be better that the fact should be noted whether or not the requirement of 18 (1) has been complie! with. But it was said that even if it had been passed the robeme was not such as the Court would be approved. Now, see what follows:-The Trustee who was appointed on 13th Ɛept., 1906. immediately after the papera were handed over to him, preceeded 88 if the requirements of s. 18 (2) had not been complied with that is that the resolution required the suppor of three-quarters of the creditors to in Mr. Lowe's affidavit of 1st November.
who have proved": this is expressly referred He says the reason why the scheme of arrangement mentioned in paragraph 4 of the debtor's | affidavit (ie. the scheme pat to the creditor's meeting of 3rd August) was not proceeded majority with was because the scheme was not voted by a in nu'aber reprea-ating three- quarters i value of the creditors who had proved." The figures do bear out this state- meat, and from this point of view Mr Ho Tung's vote did not affect the proceedings. But it is a wrong point of view altogether as [ have already shown. Mr. Lowe then proceeds to explain why he could not accept the soheme which the debtor had brought forward, giving a variety of reasons, many of which are certain- Bat this scheme was ly substantial reasons. propounded because the first scheme had beeu defeated by Mr. Ho Tang's vote.
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I cinnot assume that the first scheme would have been I cannot objected to on the same grounds. even express deailed opinion on it; bat in read- following ing the objections formulated by Mr. Lowe, the observations occur to me:- -HA says that the deposit in the Bank proposed Was not guarranteed. Chung Chim wai referred to in the scheme is, I understand, the same person 08 Chung Cheung-kwai who offered to pay the money in the first schem». But the criticism does not necessarily apply to the proposal in the first scheme, because under that the 20 per cent. was to be paid by Chang Cheung kwai, the debtor's brother, in the mouth of August. Mr. Lowe may have had objections to this, but I do not find any statement of them. The objections which are personal to the debtor, may perhaps have been advance! again't the first scheme, but the ' bribery.' (i.e, the pointing oat to the frustee that it was to his personni interest to accept the schem—and which, need hardly say, was most reprehensible) occurrei with regar to the acceptance of the new scheme, and might not have occurred at all if the old scheme had been adopted, or least considered. And with regard to the allegations that the debtor did not disclose all his property, and that the Trustee had the grestest difficulty in obtaining any informs. said tion from him about his affairs, what daring the argument about the debtor's state of mind must not be understood to mean that I intend to pallista his conduct, but that the time has not arrived for me to deal with it. I adopt the words of the Trustee, hitself: “Tha debtor was so upset he could not exactly quite say" that was his unhappy position, all the way through, from the time of Mr. Ho Tung's action in this Court to his public examination
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