| 1 | 2 | 3 | 4 |
BANKRUPTCY ORDINANCE

BANKRUPTCY ORDINANCE [cf. 1914 c. 59 s. 119 U. K.] PART VII SUPPLEMENTAL PROVISIONS Disobedience to order of court 110. Disobedience to order of court Where default is made by a trustee, debtor or other person in obeying any order or direction made or given by the court under this Ordinance, the court may make an immediate order for the committal of such trustee, debtor or other person for contempt of court: (See Forms 98, 101) Provided that the power given by this section shall be deemed to be in addition to and not in substitution for any other right, remedy or liability in respect of such default. [cf. 1914 c. 59 s. 105 (5) U. K.] Application of Ordinance (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule) 111. Exclusion of corporations, companies and limited partnerships A receiving order shall not be made against any corporation, or against any association or company registered under the Companies Ordinance (Cap.

32), or any enactment repealed by that Ordinance, or against any partnership registered under the Limited Partnerships Ordinance (Cap. 37).

[cf. 1914 c. 59 s. 126 U. K.] 112. Administration in bankruptcy of estate of person dying insolvent (1) Any creditor of a deceased debtor whose debt would have been sufficient to support a bankruptcy petition against the debtor, had he been alive, may present to the court a petition in the prescribed form praying for an order for the administration in bankruptcy of the estate of the deceased debtor, according to the law of bankruptcy. (See Form 134) (2) The petition shall be served on the legal personal representative of the deceased debtor or, if there is none in Hong Kong, on the Official Administrator, and the court may in the prescribed manner, upon proof of the petitioner's debt, unless the court is satisfied that there is a reasonable probability that the estate will be sufficient for the payment of the debts owing by the deceased, make an order for the administration in bankruptcy of the deceased debtor's estate or may upon cause shown dismiss the petition with or without costs. (Amended 47 of 1984 s. 16) (3) A petition for administration in bankruptcy under this section shall not be presented to the court after proceedings have been commenced under the Rules of the Supreme Court (Cap. 4 sub. leg.) for the administration of the deceased debtor's estate but the court may, when satisfied that the estate is insufficient to pay its debts, make an order for the administration in bankruptcy of the estate of the deceased debtor and the like consequences shall ensue as under an administration order made on the petition of a creditor.

(4) Upon an order being made for the administration in bankruptcy of a deceased debtor's estate the property of the debtor shall vest in the Official Receiver as trustee thereof and he shall forthwith proceed to realize and distribute it in accordance with the provisions of this Ordinance: (See Form 136) Provided that the creditors shall have the same powers as to appointment of trustees and committees of inspection as they have in other cases where the estate of a debtor is being administered or dealt with in bankruptcy, and the provisions of this Ordinance relating to trustees and committees of inspection shall apply to trustees and committees of inspection appointed under the power so conferred. If no committee of inspection is appointed any act or thing or any direction or permission which might have been done or given by a committee of inspection may be done or given by the court.

(5) With the modifications hereinafter mentioned, all the provisions of Part III (relating to the administration of the property of a bankrupt) and, subject to any modification that may be made therein by general rules under subsection (10) the following provisions, namely section 29 (which relates to inquiries as to the debtor's conduct, dealings and property) and section 86 (which relates to the costs of trustees, managers and other persons) shall, so far as the same are applicable, apply to the case of an administration order under this section in like manner as to an order of adjudication under this Ordinance, and section 40 shall apply as if for the reference to an order of adjudication there were substituted a reference to an administration order under this section.

(6) In the administration of the property of the deceased debtor under an order of administration the Official Receiver or trustee shall have regard to any claim by the legal personal representative of the deceased debtor to payment of the proper funeral and testamentary expenses incurred by him in and about the debtor's estate, and such claims shall be deemed a preferential debt under the order and shall, notwithstanding anything to the contrary in the provisions of this Ordinance relating to the priority of other debts, be payable in full out of the debtor's estate in priority to all other debts.

(7) If on the administration of a deceased debtor's estate any surplus remains in the hands of the Official Receiver or trustee, after payment in full of all the debts due from the debtor together with the costs of the administration and interest as provided by this Ordinance in case of bankruptcy, such surplus shall be paid over to the legal personal representative of the deceased debtor's estate, or failing such representative, to the Official Administrator.

(8) Service on the legal personal representative of a deceased debtor or on the Official Administrator of a petition under this section shall, in the event of an order for administration being made thereon, be deemed to be equivalent to notice of an act of bankruptcy, and after such service no payment or transfer of property made by the legal personal representative shall operate as a discharge to him as between himself and the Official Receiver or trustee; save as aforesaid nothing in this section shall invalidate any payment made or any act or thing done in good faith by the legal personal representative before the date of the order for administration.

(9) A petition for the administration of the estate of a deceased debtor under this section may be presented by the legal personal representative of the debtor or by the Official Administrator; and where a petition is so presented by such a representative or by the Official Administrator this section shall apply subject to such modifications as may be prescribed by general rules made under subsection (10). (See Form 135) (10) General rules for carrying into effect the provisions of this section may be made in the same manner and to the like effect and extent as in bankruptcy. [cf. 1914 c. 59 s. 130 U. K.] 112A. Application of Ordinance to small bankruptcies (1) Subject to subsection (2), where a petition is presented by or against a debtor and- (a) the court receives proof to its satisfaction; or (b) the Official Receiver reports to the court, that the property of the debtor is not likely to exceed in value $200,000, the court may make an order that the debtor's estate be administered in a summary manner, and thereupon the provisions of this Ordinance shall apply subject to the following modifications- (Amended 26 of 1985 s. 3) (ia) the Official Receiver may dispense with the summoning of the first meeting of creditors required under section 17, and instead apply to the court for an order adjudging the debtor bankrupt; (Added 26 of 1985 s. 3) (i) if the debtor is adjudged bankrupt the Official Receiver shall be the trustee in the bankruptcy; (ii) there shall be no committee of inspection, and the Official Receiver may do all things which may be done by a trustee with the permission of a committee of inspection; (iii) such other modifications as may be prescribed with a view to saving expense and simplifying procedure, but nothing in this section shall permit the modification of the provisions of this Ordinance relating to the examination or discharge of the debtor.

(2) The court may, upon the application of the Official Receiver, at any time before the discharge of the debtor rescind an order made under subsection (1) and thereupon the administration shall proceed as if the order had not been made.

(Added 1 of 1976 s. 6) [cf. 1914 c. 47 s. 129 U. K.] General rules 113. Power to make general rules The Chief Justice may, with the approval of the Legislative Council, make rules providing for, generally, the carrying into effect the objects of this Ordinance. [cf. 1914 c. 59 s. 132 (1) U. K.] Fees and remuneration 114. Fees and remuneration (1) The Chief Justice may, with the approval of the Legislative Council, by order prescribe a scale of fees and percentages to be charged for or in respect of proceedings under this Ordinance. (Amended 39 of 1987 s. 4) (2) The court may remit the payment of any particular fee or fees due from any debtor, or any part thereof, either absolutely or on such terms as it may think fit.

(3) The amount of any fees prescribed under this section shall not be limited by reference to the amount of administrative or other costs incurred or likely to be incurred by the Official Receiver in proceedings in bankruptcy or in any particular bankruptcy. (Added 39 of 1987 s. 4) (4) Orders made under this section may authorize the court to fix any fee or to vary the amount of any fee otherwise prescribed. (Added 39 of 1987 s. 4) (5) No fee prescribed under this section shall be invalid by reason only of the amount of that fee. (Added 39 of 1987 s. 4) (6) Fees required to be paid under orders made under this section shall be recoverable as a debt. (Added 39 of 1987 s. 4) (7) Orders made under this section before the commencement of the Bankruptcy (Amendment) Ordinance 1987 (39 of 1987) and in force immediately before such commencement, shall have effect as from the commencement of that Ordinance as if made under this section as amended by that Ordinance. (Added 39 of 1987 s. 4) [cf. 1914 c. 59 s. 133 (1) U. K.] 115. Disposal of Official Receiver's fees All fees and commissions received by or payable to the Official Receiver on the appointment of a trustee other than himself or for acting as trustee, and any remuneration received by the Official Receiver as an interim receiver or otherwise, shall be paid by such officer forthwith into the general revenue. (Amended 47 of 1984 s. 13) Evidence 116. Evidence of proceedings at meetings of creditors (1) A minute of proceedings at a meeting of creditors under this Ordinance, signed by a person describing himself as or appearing to be chairman of the meeting, shall be received in evidence without further proof.

(2) Until the contrary is proved every meeting of creditors in respect of the proceedings whereof a minute has been so signed shall be deemed to have been duly convened and held and all resolutions passed or proceedings had thereat to have been duly passed or had.

[cf. 1914 c. 59 s. 138 U. K.] 117. Evidence of proceedings in bankruptcy Any petition or copy of a petition in bankruptcy, any order or certificate or copy of an order or certificate made by the court, any instrument or copy of an instrument, affidavit or document made or used in the course of any bankruptcy proceedings or other proceedings had under this Ordinance shall, if it appears to be sealed with the seal of the court or purports to be signed by the Registrar, or is certified as a true copy by the Registrar, be receivable in evidence in all legal proceedings whatsoever.

[cf. 1914 c. 59 s. 139 U. K.] 118. Swearing of affidavits Subject to general rules, any affidavit to be used in a bankruptcy court may be sworn before any person authorized to administer oaths, or in the case of a person who is out of Hong Kong, before a magistrate or justice of the peace or other person qualified to administer oaths in the country where he resides (he being certified to be a magistrate or justice of the peace, or qualified as aforesaid, by a British minister or British consul or by a notary public).

(Amended 47 of 1984 s. 16) [cf. 1914 c. 59 s. 140 U. K.] 119. Death of debtor or witness In the case of the death of the debtor or his wife, or of a witness whose evidence has been received by the court in any proceeding under this Ordinance, the deposition of the person so deceased, purporting to be sealed with the seal of the court, or a copy thereof purporting to be so sealed, shall be admitted as evidence of the matters therein deposed to.

[cf. 1914 c. 59 s. 141 U. K.] 120. Statements made to Official Receiver or trustee through an interpreter Any statement made by a debtor or creditor in any bankruptcy to the Official Receiver or trustee through an interpreter shall be deemed to have been made to the Official Receiver or trustee as the case may be respectively, and evidence thereof shall be receivable from the Official Receiver or trustee, on it being proved either that the interpreter employed was a sworn interpreter or that he held the substantive or acting appointment of interpreter, or of clerk and interpreter, to the Official Receiver.

121. Certificate of appointment of trustee A certificate of the Official Receiver that a person has been appointed trustee under this Ordinance shall be conclusive evidence of his appointment.

[cf. 1914 c. 59 s. 143 U. K.] Miscellaneous 122. Computation of time (1) Where by this Ordinance any limited time from or after any date or event is appointed or allowed for the doing of any act or the taking of any proceeding, then in the computation of that limited time the same shall be taken as exclusive of the day of that date or of the happening of that event, and as commencing at the beginning of the next following day; and the act or proceeding shall be done or taken at latest on the last day of that limited time as so computed.

(2) Where the limited time so appointed or allowed is less than 6 days, general holidays as defined by the Holidays Ordinance (Cap. 149) shall not be reckoned in the computation of such time.

(3) Where the limited time so appointed or allowed expires on one of the days in this section specified, the act or proceeding shall be considered as done or taken in due time if it is done or taken on the next day afterwards which is not one of the days in this section specified.

(4) The provisions of this section shall take effect notwithstanding anything contained in sections 29, 30 and 31 of the Supreme Court Ordinance (Cap. 4). (Amended 92 of 1975 s. 58) [cf. 1914 c. 59 s. 145 U. K.] 123. Service of notices All notices and other documents for the service of which no special mode is directed may be sent by post to the last known address of the person to be served therewith. [cf. 1914 c. 59 s. 146 U. K.] 124. Formal defect not to invalidate proceedings (1) No proceeding in bankruptcy shall be invalidated by any formal defect or by any irregularity unless the court is of opinion that substantial injustice has been caused by the defect or irregularity and that the injustice cannot be remedied by any order of the court.

(2) No defect or irregularity in the appointment or election of a receiver, trustee or member of a committee of inspection shall vitiate any act done by him in good faith. [cf. 1914 c. 59 s. 147 U. K.] 125. Exemption of documents from stamp duty (1) Stamp duty shall not be payable in respect of- (a) any assurance relating solely to immovable property or personal property which is part of the estate of any bankrupt, and which, after the execution of the assurance, either at law or in equity, is or remains the estate of the bankrupt or of the trustee under the bankruptcy; or (b) any other instrument relating solely to the property of any bankrupt.

(2) In this section "assurance" includes deed, conveyance, assignment and surrender. (Replaced 31 of 1981 s. 65) 126. Acting of corporations, partners, etc.

For all or any of the purposes of this Ordinance a corporation may act by any of its officers authorized in that behalf under the seal of the corporation, a firm may act by any of its members and a lunatic may act by his committee or curator bonis. [cf. 1914 c. 59 s. 149 U. K.] 127. Certain provisions to bind Crown Save as provided in this Ordinance, the provisions of this Ordinance relating to the remedies against the property of a debtor, the priorities of debts, the effect of a composition or scheme of arrangement, and the effect of a discharge, shall bind the Crown.

[cf. 1914 c. 59 s. 151 U. K.] Unclaimed funds or dividends 128. Unclaimed and undistributed dividends or funds (1) Where a trustee, other than the Official Receiver, under any bankruptcy, composition or scheme, pursuant to this Ordinance has under his control any unclaimed dividend which has remained unclaimed for more than 6 months, or any money held in trust by the debtor for another person, or where, after making a final dividend, he has in his hands or under his control any unclaimed or undistributed money arising from the property of the debtor, he shall forthwith pay it to the Official Receiver who shall carry the same to an account to be termed the Bankruptcy Estate Account. The Official Receiver's receipt for the money so paid shall be a sufficient discharge to the trustee in respect thereof. (Amended 1 of 1976 s. 7; 47 of 1984 s. 14) (1A) Where the Official Receiver is the trustee, and under any bankruptcy, composition or scheme, pursuant to this Ordinance has under his control any unclaimed dividend which has remained unclaimed for more than 6 months or where after making a final dividend, he has in his hands or under his control any unclaimed or undistributed money arising from the property of the debtor, he shall forthwith transfer the same to the Bankruptcy Estates Account. (Added 1 of 1976 s. 7) (2) The trustee, whether he has obtained his release or not may be called upon by the court to account for any unclaimed funds or dividends and any failure to comply with the requisitions of the court in this behalf may be dealt with as a contempt of court.

(3) Any person claiming to be entitled to any moneys paid into the Bankruptcy Estate Account under this Ordinance may, within 5 years of the date when the same was so paid in, apply to the Official Receiver for payment to him of the same, and the Official Receiver, if satisfied that the person claiming is entitled, shall make an order for the payment to such person of the sum due. Any person dissatisfied with the decision of the Official Receiver may appeal to the court. (Amended 33 of 1939; G. N.

840 of 1940 supp. Schedule; 1 of 1976 s. 7) (4) After any money has remained unclaimed in the Bankruptcy Estates Account for a period of 5 years the Official Receiver may transfer such money to the general revenue of Hong Kong. (Replaced 1 of 1976 s. 7) (5) Before transferring any money under subsection (4) the Official Receiver may give such notice as he thinks necessary to such parties as he may think fit. (Replaced 1 of 1976 s. 7) [cf. 1914 c. 59 s. 153 (1) U. K.] 128A. Deposit of surplus cash balances (1) Whenever the cash balance standing to the credit of- (a) the Bankruptcy Estates Account referred to in section 128; or (b) any account operated by the Official Receiver under section 91, is in excess of the amount which, in the opinion of the official Receiver, is required for the time being to answer demands in respect of debtor's estates, the Official Receiver may deposit the whole or any part of that excess with a bank. (Amended 47 of 1984 s. 15) (2) The Official Receiver shall on or after 31 March in each year transfer to the general revenue any interest paid in respect of deposits under subsection (1). (Added 65 of 1976 s. 5) PART VIII BANKRUPTCY OFFENCES 129. Fraudulent debtors (1) Any person who has been adjudged bankrupt or in respect of whose estate a receiving order has been made shall in each of the cases following be guilty of an offence- (a) if he does not to the best of his knowledge and belief fully and truly discover to the trustee all his property, real and personal, and how and to whom and for what consideration and when he disposed of any part thereof, except such part as has been disposed of in the ordinary way of his trade (if any) or laid out in the ordinary expenses of his family, unless he proves that he had no intent to defraud; (b) if he does not deliver up to the trustee, or as he directs, all such part of his movable or immovable property as is in his custody or under his control and which he is required by law to deliver up, unless he proves that he had no intent to defraud; (c) if he does not deliver up to the trustee, or as he directs, all books, documents, papers and writings in his custody or under his control relating to his property or affairs, unless he proves that he had no intent to defraud; (d) if, after the presentation of a bankruptcy petition by or against him or within 12 months next before such presentation, he conceals any part of his property to the value of $50 or upwards or conceals any debt due to or from him, unless he proves that he had no intent to defraud; (e) if, after the presentation of a bankruptcy petition by or against him or within 12 months next before such presentation, he fraudulently removes any part of his property to the value of $50 or upwards; (f) if he makes any material omission or misstatement in any statement relating to his affairs, unless he proves that he had no intent to defraud; (g) if, knowing or having any reason to believe that a false debt has been proved by any person under the bankruptcy, he fails for the period of a month to inform the trustee thereof; (h) if, after the presentation of a bankruptcy petition by or against him, he prevents or is party or privy to preventing the production of any book, document, paper or writing affecting or relating to his property or affairs, unless he proves that he had no intent to conceal the state of his affairs or to defeat the law; (i) if, after the presentation of a bankruptcy petition by or against him or within 12 months next before such presentation, he removes, conceals, destroys, mutilates or falsifies or is privy to the removal, concealment, destruction, mutilation or falsification of any book or document affecting or relating to his property or affairs, unless he proves that he had no intent to conceal the state of his affairs or to defeat the law; (j) if, after the presentation of a bankruptcy petition by or against him or within 12 months next before such presentation, he makes or is privy to the making of any false entry in any book or document affecting or relating to his property or affairs, unless he proves that he had no intent to conceal the state of his affairs or to defeat the law; (k) if, after the presentation of a bankruptcy petition by or against him or within 12 months next before such presentation, he fraudulently parts with, alters or makes any omission in, or is privy to the fraudulently parting with, altering or making any omission in, any document affecting or relating to his property or affairs; (l) if, after the presentation of a bankruptcy petition by or against him or at any meeting of his creditors within 12 months next before such presentation, he attempts to account for any part of his property by fictitious losses or expenses; (m) - (n) (Repealed 21 of 1970 s. 35) (o) if, within 12 months next before the presentation of a bankruptcy petition by or against him or after the presentation of a bankruptcy petition and before the making of a receiving order, he pawns, pledges or disposes of any property which he has obtained on credit and has not paid for, unless, in the case of a trader, such pawning, pledging or disposing is in the ordinary way of his trade, and unless in any case he proves that he had no intent to defraud; (p) if he is guilty of any false representation or other fraud for the purpose of obtaining the consent of his creditors or any of them to an agreement with reference to his affairs or to his bankruptcy.

(Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 50 of 1991 s. 4) (2) A person who has sent out of Hong Kong any property which he has obtained on credit and has not paid for shall until the contrary is proved be deemed to have disposed of the same otherwise than in the ordinary way of his trade if, such property not having been paid or accounted for at the date of the receiving order by the person to whom the same was sent, such last-mentioned person does not pay or account for the same within a reasonable time after being called upon to do so by the trustee or cannot be found within a reasonable time. (Amended 47 of 1984 s. 16).

(3) In any prosecution under subsection (1) (i) the absence of any such book or document as is referred to in the said paragraph shall be prima facie evidence that such book or document was removed by the debtor contrary to the provisions of the said paragraph or that he was privy to its removal contrary to those provisions, and thereupon the onus shall be upon the debtor to prove that he did not so remove such book or document and that he was not privy to such removal. (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule) (4) In any prosecution under subsection (1) (i) the mutilation or falsification of any such book or document as is referred to in the said paragraph shall be prima facie evidence that such book or document was mutilated or falsified by the debtor in contravention of the provisions of the said paragraph or that he was privy to its mutilation or falsification contrary to those provisions, and thereupon the onus shall be upon the debtor to prove that he did not so mutilate or falsify the said book or document and that he was not privy to such mutilation or falsification.

(Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule) (5) Any person guilty of an offence in the cases mentioned in subsection (1) (o) shall be liable on summary conviction to imprisonment for 1 year or upon conviction on indictment to imprisonment for 5 years. (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 50 of 1991 s. 4) (6) For the purposes of this section, "trustee" includes the Official Receiver, whether acting as Official Receiver or as a trustee.

[cf. 1914 c. 59 s. 154 U. K.; 1926 c. 7 s. 5 U. K.] 130. Certain offences by persons other than the debtor (1) If any manager, accountant or book-keeper in the employment of the debtor does any act which if committed by the debtor would be a contravention of any of the provisions of section 129 (1) (i) or (j), or is privy to any such act whether committed by the debtor or by any other person, such manager, accountant or book-keeper shall be deemed to be guilty of an offence. (Amended 33 of 1939; G. N. 840 of 1940 Supp.

Schedule; 50 of 1991 s. 4) (2) Where any person pawns, pledges or disposes of any property in circumstances which amount to an offence under section 129 (1) (o), every person who takes in pawn or pledge or otherwise receives the property, knowing it to be pawned, pledged or disposed of in such circumstances as aforesaid, shall be guilty of an offence and shall be liable on summary conviction to imprisonment for 1 year or upon conviction on indictment to imprisonment for 5 years. (Amended 33 of 1939; G. N. 840 of 1940 Supp.

Schedule; 50 of 1991 s. 4) [cf. 1926 c. 7 s. 5 (2) U. K.] 131. Undischarged bankrupt obtaining credit Any undischarged bankrupt shall in each of the cases following be guilty of an offence- (a) if either alone or jointly with any other person he obtains credit to the extent of $100 or upwards from any person without first informing that person that he is an undischarged bankrupt; or (b) if he engages in any trade or business under a name or names other than that or those under which he was adjudicated bankrupt and in the course of such trade or business obtains credit from any person without first disclosing to such person the name or names under which he was adjudicated bankrupt; or (c) if he engages in any trade or business under a name or names other than that or those under which he was adjudicated bankrupt without first publishing, once in the Gazette, and in 3 successive issues of 2 local newspapers one of which shall be Chinese, a notice containing the following particulars- (i) the name or names under which he was adjudicated bankrupt; (ii) the last address at which he carried on any trade or business prior to the adjudication; (iii) the name or names under which he intends to carry on the trade or business; (iv) the nature of the trade or business which he intends to carry on; and (v) the address or addresses at which he intends to carry it on. (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 20 of 1948 s.

4; 50 of 1991 s. 4) [cf. 1914 c. 59 s. 155 U. K.] 132. Frauds by bankrupts, etc.

Any person who has been adjudged bankrupt or in respect of whose estate a receiving order has been made shall in each of the cases following be guilty of an offence- (a) (Repealed 21 of 1970 s. 35) (b) if with intent to defraud his creditors or any of them he has made or caused to be made any gift or transfer of or charge on his property; or (c) if with intent to defraud his creditors he had concealed or removed any part of his property since or within 2 months before the date of any unsatisfied judgment or order for payment of money obtained against him; or (d) if with intent to defraud his creditors or any of them he has caused or connived at the levying of any execution against his property.

[cf. 1926 c. 7 s. 6 U. K.] (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 20 of 1948 s. 4; 50 of 1991 s. 4) [cf. 1914 c. 59 s. 156 U. K.] 133. Bankrupt guilty of gambling, etc.

(1) Any person who has been adjudged bankrupt, or in respect of whose estate a receiving order has been made, shall be guilty of an offence if, having been engaged in any trade or business and having outstanding at the date of the receiving order any debts contracted in the course and for the purposes of such trade or business- (Amended 50 of 1991 s. 4) (a) he has within 2 years prior to the presentation of the bankruptcy petition materially contributed to or increased the extent of his insolvency by gambling or by rash and hazardous speculations and such gambling or speculations are unconnected with his trade or business; or (b) he has between the date of the presentation of the petition and the date of the receiving order lost any part of his estate by such gambling or rash and hazardous speculations as aforesaid; or (c) on being required by the Official Receiver at any time, or in the course of his public examination by the court, to account for the loss of any substantial part of his estate incurred within a period of a year next preceding the date of the presentation of the bankruptcy petition or between that date and the date of the receiving order, he fails to give a satisfactory explanation of the manner in which such loss was incurred: Provided that, in determining for the purposes of this section whether any speculations were rash and hazardous, the financial position of the accused person at the time when he entered into the speculations shall be taken into consideration.

(2) A prosecution shall not be instituted against any person under this section except by order of the court. (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule) [cf. 1914 c. 59 s. 157 U. K.] 134. Bankrupt failing to keep proper accounts (1) Any person who has been adjudged bankrupt or in respect of whose estate a receiving order has been made shall be guilty of an offence if, having been engaged in any trade or business during any period in the 2 years immediately preceding the date of the presentation of the bankruptcy petition, he has not kept proper books of account throughout that period and throughout any further period in which he was so engaged between the date of the presentation of the petition and the date of the receiving order, or has not preserved all books of account so kept; (Amended 50 of 1991 s. 4) Provided that a person who has not kept or has not preserved such books of account shall not be convicted of an offence under this section- (a) if his unsecured liabilities at the date of the receiving order did not exceed, in the case of a person who has not on any previous occasion in Hong Kong or elsewhere been adjudged bankrupt or made a composition or arrangement with his creditors, $5,000 or in any other case $1,000; or (Amended 47 of 1984 s. 16) (b) if he proves that in the circumstances in which he traded or carried on business the omission was honest and excusable.

(2) A prosecution shall not be instituted against any person under this section except by order of the court. (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule) (3) For the purposes of this section, a person shall be deemed not to have kept proper books of account if he has not kept such books or accounts as are necessary to exhibit or explain his transactions and financial position in his trade or business, including a book or books containing entries from day to day in sufficient detail of all cash received and cash paid, and where the trade or business has involved dealings in goods, statements of annual stock-takings, and (except in the case of goods sold by way of retail trade to the actual consumer) accounts of all goods sold and purchased showing the buyers and sellers thereof in sufficient detail to enable the goods and the buyers and sellers thereof to be identified.

In the case of books or accounts kept in the Chinese language a person shall, for the purposes of this section, be deemed not to have kept proper books of account if he has not kept such books or accounts as may be proved to be usual and necessary, for the purposes aforesaid, in the particular trade or business carried on by the debtor.

[cf. 1914 c. 59 s. 158 U. K.; 1926 c. 7 s. 7 U. K.] 135. Bankrupt absconding with property If any person who is adjudged bankrupt, or in respect of whose estate a receiving order has been made, after the presentation of a bankruptcy petition by or against him, or within 6 months before such presentation, quits Hong Kong and takes with him, or attempts or makes preparation to quit Hong Kong and take with him, any part of his property to the amount of $100 or upwards, which ought by law to be divided amongst his creditors, he shall (unless he proves that he had no intent to defraud) be guilty of an offence.

(Amended 47 of 1984 s. 16; 50 of 1991 s. 4) [cf. 1914 c. 59 s. 159 U. K.] 136. Debtor concealing himself to avoid service, etc.

If any person against whom a receiving order is made conceals himself or absents himself from his usual or last known place of abode or business or quits Hong Kong, with intent to avoid service of any process in bankruptcy or to avoid examination in respect of his affairs or otherwise to defeat, embarrass or delay any proceedings against him in bankruptcy, he shall be guilty of an offence. A person who, after the presentation of a bankruptcy petition by or against him or within 3 months next before such presentation, conceals or absents himself as aforesaid or quits Hong Kong shall until the contrary is proved be deemed to have concealed or absented himself or quitted Hong Kong with such intent as is mentioned in this section.

(Amended 47 of 1984 s. 16; 50 of 1991 s. 4) 137. (Repealed 21 of 1970 s. 35) 138. Order by court for prosecution on report of trustee Where the Official Receiver or a trustee in a bankruptcy reports to the court that in his opinion a debtor who has been adjudged bankrupt or in respect of whose estate a receiving order has been made has been guilty of any offence under this Ordinance, or where the court is satisfied upon the representation of any creditor or member of the committee of inspection that there is ground to believe that the debtor has been guilty of any such offence, the court shall, if it appears to the court that there is a reasonable probability that the debtor will be convicted and that the circumstances are such as to render a prosecution desirable, order that the debtor be prosecuted for such offence, but no such order shall be a condition antecedent to any prosecution under this Ordinance.

(Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule) [cf. 1914 c. 59 s. 161 U. K.; 1926 c. 7 s. 8 U. K.] 139. Criminal liability after discharge or composition Where a debtor has been guilty of any criminal offence he shall not be exempt from being proceeded against therefor by reason that he has obtained his discharge or that a composition or scheme of arrangement has been accepted or approved.

[cf. 1914 c. 59 s. 162 U. K.] 140. Trial and punishment of offences (1) A person guilty of an offence under this Ordinance in respect of which no special penalty is imposed by this Ordinance shall be guilty of an offence triable either summarily or upon indictment, and shall be liable to imprisonment for 2 years. (Amended 33 of 1939; G. N. 840 of 1940 Supp.

Schedule; 22 of 1950 s. 3; 50 of 1991 s. 4) (2) Summary proceedings in respect of any such offence shall not be instituted after 1 year from the first discovery thereof either by the Official Receiver or by the trustee in the bankruptcy, or in the case of proceedings instituted by a creditor, by the creditor, nor in any case shall they be instituted after 3 years from the commission of the offence.

(3) In an indictment for an offence under this Ordinance it shall be sufficient to set forth the substance of the offence charged in the words of this Ordinance specifying the offence, or as near thereto as circumstances admit, without alleging or setting forth any debt, act of bankruptcy, trading, adjudication, or any proceedings in, or order, warrant or document of, the court acting under this Ordinance. (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule) [cf. 1914 c. 59 s. 164 U. K.; 1926 c. 7 s. 10 U. K.] 141. Evidence as to frauds by agents A statement or admission made by any person in any compulsory examination or deposition before the court on the hearing of any matter in bankruptcy shall not be admissible as evidence against that person or (unless they married after the making of the statement or admission) against the wife or husband of that person in any proceeding in respect of an offence under the Theft Ordinance (Cap. 210).

(Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 21 of 1970 s. 35) [cf. 1914 c. 59 s. 166 U. K.] 142. Summary prosecution Any offence under this Ordinance may be dealt with summarily by a magistrate. (Amended 23 of 1933 s. 2; 33 of 1939; G. N. 840 of 1940 Supp.

Schedule) PART IX MISCELLANEOUS 143. Transitional The Bankruptcy (Amendment) Ordinance 1986 (45 of 1986) shall apply in relation to proceedings on a bankruptcy petition presented before the commencement of that Ordinance as it applies in relation to proceedings on a bankruptcy petition presented thereafter, save that sections 2 and 3 of that Ordinance shall not apply in relation to any proceedings in which a receiving order had been made before such commencement. (45 of 1986 s. 5 incorporated) SCHEDULE I CRIMINAL BANKRUPTCY ORDERS [ss. 74A, 74B & 74C] PART I GENERAL 1. Interpretation In this Schedule- "criminal bankruptcy debt" means a debt deemed to be due to any person by virtue of paragraph 3.

2. Act of bankruptcy Subject to the provisions of this Schedule, where a criminal bankruptcy order is made against any person he shall be treated as a debtor who has committed an act of bankruptcy on the date on which the order is made.

3. Creditors and criminal bankruptcy debts A person specified in a criminal bankruptcy order as having suffered loss or damage of any amount shall be treated for the purpose of any ensuing proceedings pursuant to- (a) a bankruptcy petition presented by virtue of paragraph 2; or (b) a petition under section 112 (administration in bankruptcy of estate of person dying insolvent) presented by virtue of this Schedule, as a creditor for a debt of that amount provable in the bankruptcy of the person against whom the order was made.

PART II APPLICATION OF THE ORDINANCE IN PROCEEDINGS BASED ON A CRIMINAL BANKRUPTCY ORDER 4. Criminal bankruptcy petition No criminal bankruptcy petition shall be presented by the person who under paragraph 2 is the debtor; and, in relation to such a petition presented by a creditor, section 6 shall have effect with the following modifications- (a) subsections (I) (a) and (b) and (2) (conditions as to nature of debt) shall not apply to a criminal bankruptcy debt; and (b) subsection (I) (d) (domicile of debtor) shall be omitted.

5. Receiving order For the purposes of section 9 (2) and (3) (matters to be proved before receiving order is made) the act of bankruptcy which a person is treated by this Schedule as having committed and any criminal bankruptcy debt shall be treated as conclusively proved by the production of a copy of the criminal bankruptcy order in question and the following provisions of that section shall not apply in relation to any such debt- (a) so much of subsection (3) which provides that if the court is not satisfied that the assets for division among the unsecured creditors, after payment of all costs, charges and expenses, and the debts which are preferential under that Ordinance, will be sufficient to pay a dividend of 15 per cent, it may dismiss the petition; (b) subsection (5); (c) subsection (6).

6. Trustee of criminal bankrupt's property Where a person is adjudged bankrupt in proceedings pursuant to a criminal bankruptcy petition the Official Receiver shall in the bankruptcy be the trustee of the property of the bankrupt and section 23 shall not apply in relation to any such proceedings.

7. Proof of criminal bankruptcy debt in bankruptcy proceedings (1) For the purpose of proving a criminal bankruptcy debt in proceedings pursuant to a criminal bankruptcy petition, a copy of the criminal bankruptcy order specifying the amount deemed by virtue of paragraph 3 to be due as a debt shall, subject to paragraph 5, be treated as sufficient evidence of the debt unless it is shown by any party to the proceedings that the amount of the relevant loss or damage is greater or less than the amount specified in the order or that the loss or damage did not in fact result from any offence specified in the order, and if it is shown by any party to the proceedings that the amount of the relevant loss or damage is other than that specified in the order, paragraph 3 shall have effect as if that other amount had been specified in the order, but without prejudice to the validity of the order if the amount of the relevant loss is shown not to exceed $150,000 or such other amount as may be specified in an order made under section 84A (5) of the Criminal Procedure Ordinance (Cap. 221).

(2) Nothing in this paragraph or paragraph 3 shall be taken as prejudicing the proof in proceedings pursuant to a criminal bankruptcy petition of debts other than criminal bankruptcy debts.

(3) Nothing in sub-paragraph (1) shall be construed as entitling any person to contend that the offence or offences specified in a criminal bankruptcy order were not committed by the person against whom the order was made.

8. Recovery of assets for benefit of criminal bankrupt's creditors (1) Without prejudice to any other provision of this Ordinance, sub- paragraph (2) to (5) shall apply, where a person is adjudged bankrupt in proceedings pursuant to a criminal bankruptcy petition, with respect to dispositions of property or any interest in property made by the bankrupt on or after the relevant date, either by way of gift or for an under- value.

In this sub-paragraph, "relevant date" means the date specified in the criminal bankruptcy order (in accordance with section 84A (3) (d) of the Criminal Procedure Ordinance (Cap. 221) as the earliest date on which the offence or, as the case may be, the earliest of the offences, was committed.

(2) On the application of the Official Receiver (in his capacity as trustee) the court may make orders requiring- (a) the person taking under any such disposition; or (b) subject to sub-paragraph (3), any other person who by virtue of any subsequent disposition acquired (whether or not from the person taking under the bankrupt's disposition) the whole or any part of the property or any interest therein, to transfer the whole or any part of the property, or such interest as the order may specify, to the trustee, or to make such payments to the trustee as the court thinks just with a view to making available to the creditors the full value of the property or interest disposed of by the bankrupt (including any increase in its value since the disposition was made).

(3) No order shall be made by virtue of subparagraph (2) (b) against a person appearing to the court to have given full value for anything taken by him under a relevant disposition or to claim (directly or indirectly) through a person who gave full value.

(4) An order of the court under this paragraph requiring a person to transfer any property or interest may include such consequential directions for giving effect to the order, and be made on such terms (including in particular terms allowing the person to retain or recover consideration given by him for any relevant disposition) as the court thinks just in all the circumstances.

(5) In this paragraph, "disposition" includes any conveyance or assurance of property of any description.

9. Administration in bankruptcy of deceased offender's estate (1) Where an order for administration is made under section 112 on a criminal bankruptcy administration petition, so much of subsection (4) of that section as enables the creditors to appoint a trustee of the property of the debtor in place of the Official Receiver shall not apply.

(2) Paragraph 7 shall apply in relation to proof of criminal bankruptcy debts in proceedings pursuant to a criminal bankruptcy administration petition as it applies in relation to proof of such debts in proceedings pursuant to a criminal bankruptcy petition.

10. Bankruptcy proceedings otherwise than by virtue of this Schedule Where a criminal bankruptcy order has been made against any person and a bankruptcy petition has been presented in respect of him before the order was made, or is presented in respect of him thereafter otherwise than by virtue of paragraph 2, the court may, on the application of the Official Petitioner, dismiss the petition, rescind any receiving order made in pursuance thereof or, if that person has been adjudged bankrupt, annul the adjudication on such terms, if any, as the court thinks fit.

11. Effect of appeal against conviction (1) Subject to the provisions of this paragraph, the fact that an appeal is pending against any conviction by virtue of which a criminal bankruptcy order was made shall not preclude the taking of any proceedings by virtue of this Schedule in consequence of the making of the order.

(2) Where a person is adjudged bankrupt in proceedings pursuant to a criminal bankruptcy petition, no property shall be distributed by his trustee in bankruptcy and no order shall be made by the court under paragraph 8 so long as an appeal is pending against his conviction of any offence by virtue of which the criminal bankruptcy order was made.

(Amended L. N. 65 of 1986) (3) For the purposes of this paragraph an appeal against a conviction is pending- (a) in any case until the expiration of the time for giving notice of appeal or applying for leave to appeal under section 83Q of the Criminal Procedure Ordinance (Cap. 221) (disregarding any extension of time which may be granted under subsection (3) of that section); (b) if notice of appeal or of application for leave is given during that period and during that period the appellant notifies the Official Receiver thereof, until the determination of the appeal and thereafter for so long as an appeal to the Privy Council is pending within the meaning of section 84B (5) of that Ordinance.

(4) Where in consequence of an appeal a criminal bankruptcy order is rescinded- (a) any bankruptcy petition based on the order shall lapse and any receiving order or adjudication of bankruptcy made in consequence thereof shall cease to have effect, but without prejudice to anything previously done thereunder; (b) where any such adjudication ceases to have effect, the property of the person who was adjudicated bankrupt shall revert to him for all his estate or interest therein; and (c) the court may, on his application or on the application of the Official Receiver, by order give such directions, if any, as appear to the said court to be necessary or desirable in consequence of the provisions of sub-paragraphs (a) and (b).

(5) Where in consequence of an appeal a criminal bankruptcy order is amended by the deletion of any amount specified therein as the loss or damage suffered by any person, paragraph 3 shall not thereafter apply to that loss or damage but without prejudice to anything done before the amendment takes effect. PART III FUNCTIONS OF OFFICIAL PETITIONER 12. Presentation of criminal bankruptcy petition by Official Petitioner (1) The Official Petitioner may present a criminal bankruptcy petition, and a receiving order may be made on that petition.

(2) Section 6, as modified by paragraph 4 of this Schedule, shall apply to a criminal bankruptcy petition presented by the Official Petitioner as it applies to a petition presented by a creditor, but the court may allow the petition to be presented later than required by subsection (1) (c) of that section.

(3) The following provisions- (a) section 9 (2) (making of receiving order on creditor's petition); (b) section 9 (3) (dismissal of petition); and (c) section 9 (7) (withdrawal of creditor's petition), shall apply in relation to a criminal bankruptcy petition presented by the Official Petitioner as if any reference to the debt of the petitioning creditor were a reference to any criminal bankruptcy debt within the meaning of this Schedule; and paragraph 5 shall have effect in relation to section 9 (2) and (3) as they apply by virtue of this paragraph.

13. Presentation of criminal bankruptcy administration petition by Official Petitioner (1) The Official Petitioner may present a petition under section 112 in any case in which a creditor could do so by virtue of this Schedule, and an order may be made under that section on that petition.

(2) Section 112 (2) shall have effect in relation to a petition presented by the Official Petitioner as if the reference to the petitioner's debt were a reference to any criminal bankruptcy debt within the meaning of this Schedule.

14. Participation of Official Petitioner in proceedings brought by virtue of this Schedule (whether by the Official Petitioner or by a creditor) (1) In the case of proceedings pursuant to a criminal bankruptcy petition or a criminal bankruptcy administration petition, the Official Petitioner shall be entitled- (a) to attend any meeting of creditors and, before the meeting, to receive any notice or other document required to be sent before such a meeting to any creditor; (b) to be a member of any committee of inspection appointed under section 24, but not so as to count towards the number of members mentioned in subsection (2) or (9), or be subject to removal under subsection (7), of that section; (c) to be a party to any such proceedings before the court.

(2) In the case of proceedings pursuant to- (a) a criminal bankruptcy petition or a criminal bankruptcy administration petition, the provisions of the Ordinance mentioned in sub-paragraph (3) shall have effect as if any reference to a creditor, or to a creditor who has proved or tendered a proof, included a reference to the Official Petitioner; and (b) a criminal bankruptcy administration petition, the expression " a petition under this section" in section 112 (8) shall include a reference to a petition by the Official Petitioner.

(3) The provisions referred to in sub-paragraph (2) are- (a) section 15 (power to appoint special manager); (b) section 18 (2) and (4) (debtor's statement of affairs); (c) section 19 (4) and (8) (public examination of debtor); (d) section 20 (5), (6) and (8) (compositions and schemes of arrangement); (e) section 30 (2) and (8) (discharge of bankrupt); (f) section 42 (relation back of trustee's title); (g) section 78 (1) (e) (report to creditors of debtor's proposal); (h) section 83 (appeal to court against act or decision of trustee).

(Schedule 1 added 21 of 1979 s. 3. Amended 39 of 1992 s. 6) [cf. 1973 c. 62 Schedule 2 U. K.] SCHEDULE 2 [ss. 75 & 76] PART I 1. Assistant Official Receiver (Legal) 2. Assistant Official Receiver (Case Management) 3. Assistant Principal Solicitor 4. Senior Solicitor 5. Solicitor PART II 1. Assistant Director of Accounting Services 2. Chief Insolvency Officer 3. Senior Insolvency Officer 4. Insolvency Officer (Schedule 2 added 39 of 1992 s. 6) n respect of the property disclaimed as from the date when the property vested in him, but shall not, except so far as is necessary for the purpose of releasing the bankrupt and his property and the trustee from liability, affect the rights or liabilities of any other person.

(3) A trustee shall not be entitled to disclaim a lease without the leave of the court, except in any cases which may be prescribed by general rules, and the court may, before or on granting such leave, require such notices to be given to persons interested, and impose such terms as a condition of granting leave, and make such orders with respect to fixtures, tenant's improvements and other matters arising out of the tenancy, as the court thinks just.

(4) The trustee shall not be entitled to disclaim any property in pursuance of this section in any case where an application in writing has been made to the trustee by any person interested in the property requiring him to decide whether he will disclaim or not and the trustee has for a period of 28 days after the receipt of the application, or such extended period as may be allowed by the court, declined or neglected to give notice whether he disclaims the property or not; and in the case of a contract, if the trustee after such application as aforesaid does not within the said period or extended period disclaim the contract, he shall be deemed to have adopted it.

(5) The court may, on the application of any person who is, as against the trustee, entitled to the benefit or subject to the burden of a contract made with the bankrupt, make an order rescinding the contract on such terms as to payment by or to either party of damages for the non- performance of the contract, or otherwise, as to the court may seem equitable, and any damages payable under the order to any such person may be proved by him as a debt under the bankruptcy.

(6) The court may, on application by any person claiming either to have any interest in any disclaimed property or to be under any liability not discharged by this Ordinance in respect of any disclaimed property, and on hearing such persons as it thinks fit, make an order for the vesting of the property in or delivery thereof to any person entitled thereto, or to whom it may seem just that the same should be delivered by way of compensation for such liability as aforesaid, or a trustee for him, and on such terms as the court thinks just; and on any such vesting order being made, the property comprised therein shall vest accordingly in the person therein named in that behalf without any conveyance or assignment for the purpose: Provided that where the property disclaimed is of a leasehold nature the court shall not make a vesting order in favour of any person claiming under the bankrupt, whether as under-lessee or as a person entitled to a mortgage except upon the terms of making that person- (a) subject to the same liabilities and obligations as the bankrupt was subject to under the lease in respect of the property at the date when the bankruptcy petition was filed; or (b) if the court thinks fit, subject only to the same liabilities and obligations as if the lease had been assigned to that person at that date, and in either event (if the case so requires) subject only to the same liabilities and obligations as if the lease had comprised only the property comprised in the vesting order; and any under-lessee or person entitled to a mortgage who declines to accept a vesting order upon such terms shall be excluded from all interest in and security upon the property, and if there is no person claiming under the bankrupt who is willing to accept an order upon such terms, the court shall have power to vest the bankrupt's estate and interest in the property in any person liable either personally or in a representative character and either alone or jointly with the bankrupt to perform the lessee's covenants in the lease, freed and discharged from all estates, incumbrances and interests created therein by the bankrupt. (Amended 47 of 1984 s. 10) (7) Where on the release, removal, resignation or death of a trustee in bankruptcy the Official Receiver is acting as trustee, he may disclaim any property which might be disclaimed by a trustee under the foregoing provisions, notwithstanding that the time prescribed by this section for such disclaimer has expired, but such power of disclaimer shall be exercisable only within 12 months after the Official Receiver has become trustee in the circumstances aforesaid or has become aware of the existence of such property, whichever period may last expire.

(8) Any person injured by the operation of a disclaimer under this section shall be deemed to be a creditor of the bankrupt to the extent of the injury and may accordingly prove the same as a debt under the bankruptcy.

(See Forms 123 to 130) [cf. 1914 c. 59 s. 54 U. K.] 60. Powers of trustee to deal with property Subject to the provisions of this Ordinance and to any order of the court, the trustee may do all or any of the following things- (a) sell all or any part of the property of the bankrupt (including the goodwill of the business, if any, and the book debts due or growing due to the bankrupt), by public auction or private contract, with power to transfer the whole thereof to any person or company, or to sell the same in parcels, and any transfer of a business of a bankrupt by the Official Receiver or trustee shall be deemed to be exempted from the provisions of the Transfer of Businesses (Protection of Creditors) Ordinance (Cap. 49); (b) give receipts for any money received by him, which receipts shall effectually discharge the person paying the money from all responsibility in respect of the application thereof; (c) prove, rank, claim and draw a dividend in respect of any debt due to the bankrupt; (d) exercise any powers the capacity to exercise which is vested in the trustee under this Ordinance and execute any powers of attorney, deeds and other instruments for the purpose of carrying into effect the provisions of this Ordinance. (Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 20 of 1948 s. 4) [cf. 1914 c. 59 s. 55 U. K.] 61. Powers exercisable by trustee with permission of committee of inspection The trustee may, with the permission of the committee of inspection, do all or any of the following things- (a) carry on the business of the bankrupt so far as may be necessary for the beneficial winding up of the same; (b) bring, institute or defend any action or other legal proceeding relating to the property of the bankrupt; (c) employ a solicitor or other agent to take any proceedings or do any business which may be sanctioned by the committee of inspection; (d) accept as the consideration for the sale of any property of the bankrupt a sum of money payable at a future time subject to such stipulations as to security and otherwise as the committee think fit; (e) mortgage or pledge any part of the property of the bankrupt for the purpose of raising money for the payment of his debts; (f) refer any dispute to arbitration, or compromise any debts, claims and liabilities, whether present or future, certain or contingent, liquidated or unliquidated, subsisting or supposed to subsist between the bankrupt and any person who may have incurred any liability to the bankrupt, on the receipt of such sums, payable at such times and generally on such terms as may be agreed on; (g) make such compromise or other arrangement as may be thought expedient with creditors or persons claiming to be creditors in respect of any debts provable under the bankruptcy; (h) make such compromise or other arrangement as may be thought expedient with respect to any claim arising out of or incidental to the property of the bankrupt, made or capable of being made on the trustee by any person or by the trustee on any person; (i) divide in its existing form amongst the creditors, according to its estimated value, any property which from its peculiar nature or other special circumstances cannot be readily or advantageously sold.

The permission given for the purposes of this section shall not be a general permission to do all or any of the above-mentioned things but shall only be a permission to do the particular thing or things for which permission is sought in the specified case or cases.

(Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 20 of 1948 s. 4) [cf. 1914 c. 59 s. 56 U. K.] 62. Power to allow bankrupt to manage property The trustee, with the permission of the committee of inspection, may appoint the bankrupt himself to superintend the management of the property of the bankrupt or of any part thereof, or to carry on the trade (if any) of the bankrupt for the benefit of his creditors, and in any other respect to aid in administering the property, in such manner and on such terms as the trustee may direct.

[cf. 1914 c. 59 s. 57 U. K.] 63. Allowance to bankrupt for maintenance or service The trustee may from time to time, with the permission of the committee of inspection, make such allowance as he may think just to the bankrupt out of his property for the support of the bankrupt and his family, or in consideration of his services if he is engaged in winding up his estate, but any such allowance may be reduced by the court. [cf. 1914 c. 59 s. 58 U. K.] 64. Right of trustee to inspect goods pawned, etc.

Where any goods of a debtor against whom a receiving order has been made are held by any person by way of pledge, pawn or other security, it shall be lawful for the Official Receiver or trustee, after giving notice in writing of his intention to do so, to inspect the goods, and where such notice has been given, such person as aforesaid shall not be entitled to realize his security until he has given the trustee a reasonable opportunity of inspecting the goods and of exercising his right of redemption if he thinks fit to do so.

[cf. 1914 c. 59 s. 59 U. K.] 65. Limitation of trustee's powers in relation to copyright Where the property of a bankrupt comprises the copyright in any work or any interest in such copyright and he is liable to pay to the author of the work royalties or a share of the profits in respect thereof, the trustee shall not be entitled to sell or authorize the sale of any copies of the work, or to perform or authorize the performance of the work, except on the terms of paying to the author such sums by way of royalty or share of the profits as would have been payable by the bankrupt, nor shall he, without the consent of the author or of the court, be entitled to assign the right or transfer the interest or to grant any interest in the right by licence, except upon terms which will secure to the author payments by way of royalty or share of the profits at a rate not less than that which the bankrupt was liable to pay.

[cf. 1914 c. 59 s. 60 U. K.] 66. Protection of Official Receiver and trustee from personal liability in certain cases Where the Official Receiver or trustee has seized or disposed of any goods, chattels, property or other effects in the possession or on the premises or under the control of a debtor against whom a receiving order has been made and it is thereafter made to appear that the said goods, chattels, property or other effects were not at the date of the receiving order the property of the debtor, the Official Receiver or trustee shall not be personally liable for any loss or damage arising from such seizure or disposal sustained by any person claiming such property nor for the costs of any proceedings taken to establish a claim thereto, unless the court is of opinion that the Official Receiver or trustee has been guilty of mala fides or of gross negligence in respect of the same.

[cf. 1914 c. 59 s. 61 U. K.] Distribution of property 67. Declaration and distribution of dividends (1) Subject to the retention of such sums as may be necessary for the costs of administration, or otherwise, the trustee shall with all convenient speed declare and distribute dividends amongst the creditors who have proved their debts.

(2) The first dividend, if any, shall be declared and distributed within 4 months after the conclusion of the first meeting of creditors, unless the trustee satisfies the court that there is sufficient reason for postponing the declaration to a later date.

(3) Subsequent dividends shall, in the absence of sufficient reason to the contrary, be declared and distributed at intervals of not more than 6 months.

(4) Before declaring a dividend, the trustee shall cause notice of his intention to do so to be gazetted and shall also send reasonable notice thereof to each creditor mentioned in the bankrupt's statement who has not proved his debt.

(5) When the trustee has declared a dividend he shall cause to be gazetted and shall send to each creditor who has proved a notice showing the amount of the dividend and when and how it is payable.

(See Forms 138, 139, 141) [cf. 1914 c. 59 s. 62 U. K.] 68. Joint and separate dividends (1) Where one partner of a firm is adjudged bankrupt, a creditor to whom the bankrupt is indebted jointly with the other partners of the firm, or any of them, shall not receive any dividend out of the separate property of the bankrupt until all the separate creditors have received the full amount of their respective debts.

(2) Where joint and separate properties are being administered, dividends of the joint and separate properties shall, unless otherwise directed by the court on the application of any person interested, be declared together and the expenses of and incidental to such dividends shall be fairly apportioned by the trustee between the joint and separate properties, regard being had to the work done for and the benefit received by each property.

[cf. 1914 c. 59 s. 63 U. K.] 69. Provision for creditors residing at a distance, etc.

(1) In the calculation and distribution of a dividend the trustee shall make provision for debts provable in bankruptcy appearing from the bankrupt's statements, or otherwise, to be due to persons resident in places so distant from Hong Kong that in the ordinary course of communication they have not had sufficient time to tender their proofs or to establish them if disputed, and also for debts provable in bankruptcy the subject of claims not yet determined.

(Amended 47 of 1984 s. 16) (2) He shall also make provision for any disputed proofs or claims, and for the expenses necessary for the administration of the estate or otherwise.

(3) Subject to the foregoing provisions, he shall distribute as dividend all money in hand.

[cf. 1914 c. 59 s. 64 U. K.] 70. Right of creditor who has not proved debt before declaration of a dividend Any creditor who has not proved his debt before the declaration of any dividend or dividends shall be entitled to be paid out of any money for the time being in the hands of the trustee any dividend or dividends he may have failed to receive before that money is applied to the payment of any future dividend or dividends, but he shall not be entitled to disturb the distribution of any dividend declared before his debt was proved by reason that he has not participated therein.

[cf. 1914 c. 59 s. 65 U. K.] 71. Interest on debts (1) Where a debt has been proved and the debt includes interest or any pecuniary consideration in lieu of interest, such interest or consideration shall, for the purposes of dividend, be calculated at a rate not exceeding 8 per cent per annum and be calculated only up to the date of the receiving order, without prejudice to the right of a creditor to receive out of the estate any higher rate of interest to which he may be entitled after all the debts proved in the estate have been paid in full.

(2) In dealing with the proof of the debt the following rules shall be observed- (a) any account settled between the debtor and the creditor within 3 years preceding the date of the receiving order may be examined, and if it appears that the settlement of the account forms substantially one transaction with any debt alleged to be due out of the debtor's estate (whether in the form of renewal of a loan or capitalization of interest or ascertainment of loans or otherwise), the account may be reopened and the whole transaction treated as one; (b) any payments made by the debtor to the creditor before the receiving order, whether by way of bonus or otherwise, and any sums received by the creditor before the receiving order from the realization of any security for the debt shall, notwithstanding any agreement to the contrary, be appropriated to principal and interest in the proportion that the principal bears to the sum payable as interest at the agreed rate; (c) where the debt due is secured and the security is realized after the receiving order, or the value thereof is assessed in the proof, the amount realized or assessed shall be appropriated to the satisfaction of principal and interest in the proportion that the principal bears to the sum payable as interest at the agreed rate. [cf. 1914 c. 59 s. 66 U. K.] 72. Final dividend (1) When the trustee has realized all the property of the bankrupt, or so much thereof as can be realized without needlessly protracting the trusteeship, he shall declare a final dividend, but before so doing he shall give notice in manner prescribed to the persons whose claims to be creditors have been notified to him, but not established to his satisfaction, that if they do not establish their claims to the satisfaction of the court within a time limited by the notice, he will proceed to make a final dividend without regard to their claims.

(2) After the expiration of the time so limited or if the court on application by any such claimant grants him further time for establishing his claim, then on the expiration of such further time, the property of the bankrupt shall be divided among the creditors who have proved their debts, without regard to the claims of any other persons. [cf. 1914 c. 59 s. 67 U. K.] 73. No action for dividend No action for a dividend shall lie against the trustee, but if the trustee refuses to pay any dividend the court may, if it thinks fit, order him to pay it and also to pay out of his own money interest thereon for the time that it is withheld and the costs of the application.

[cf. 1914 c. 59 s. 68 U. K.] 74. Right of bankrupt to surplus The bankrupt shall be entitled to any surplus remaining after payment in full of his creditors, with interest, as by this Ordinance provided, and of the costs, charges and expenses of the proceedings under the bankruptcy petition.

[cf. 1914 c. 59 s. 69 U. K.] PART IIIA CRIMINAL BANKRUPTCY Interpretation 74A. Interpretation In this Part and in Schedule 1- "criminal bankruptcy administration petition" means a petition under section 112 presented by virtue of Schedule 1; "criminal bankruptcy order" means an order made under section 84A of the Criminal Procedure Ordinance (Cap. 221); "criminal bankruptcy petition" means a bankruptcy petition presented by virtue of Schedule 1.

(Amended 39 of 1992 s. 2) Official Petitioner 74B. Office and functions of Official Petitioner (1) For the purposes of discharging, in relation to cases in which a criminal bankruptcy order is made, the functions mentioned in subsection (2), there shall be an officer known as the Official Petitioner; and the Attorney General shall, by virtue of his office, be the Official Petitioner.

(2) The functions of the Official Petitioner shall be- (a) to consider whether, in a case where a criminal bankruptcy order is made, it is in the public interest that he should himself present a criminal bankruptcy petition; (b) to present a criminal bankruptcy petition in any such case where he determines it is in the public interest for him to do so; (c) to make payments, in such cases as he may determine, towards expenses incurred by other persons in connexion with proceedings pursuant to a criminal bankruptcy petition or a criminal bankruptcy administration petition; (d) to exercise, so far as he considers it to be in the public interest to do so, any of the powers conferred on him by Schedule 1. (Amended 39 of 1992 s. 2) (3) Neither the Official Petitioner nor any person acting under his authority shall be liable to any action or proceeding in respect of anything done or omitted in the discharge, or purported discharge, of the functions of the Official Petitioner under or by virtue of this Ordinance.

(4) Any functions of the Official Petitioner under this Ordinance may be discharged on his behalf by any person acting with his authority.

[cf. 1972 c. 71 s. 9 U. K.] General 74C. Effect of criminal bankruptcy order Schedule 1 shall apply to give effect to the operation of this Ordinance in a case where a criminal bankruptcy order has been made and to supplement this Ordinance in relation to dispositions made by a person against whom such an order has been made. (Amended 39 of 1992 s. 2) (Part IIIA added 21 of 1979 s. 2) PART IV OFFICIAL RECEIVER 75. Appointment of Official Receiver and other officers (1) The Governor may appoint an Official Receiver and such other officers to hold any of the offices specified in Schedule 2 as may be required to assist the Official Receiver in the performance of his duties.

(2) No person shall be appointed Official Receiver or to any of the offices specified in Part I of Schedule 2 unless on the date of such appointment he is qualified to practise as a legal practitioner in Hong Kong, the United Kingdom or in a jurisdiction listed in Schedule 1 to the Legal Practitioners Ordinance (Cap. 159).

(3) The Official Receiver and the holder of an office specified in Part I of Schedule 2 shall be deemed to be legal officers for the purpose of the Legal Officers Ordinance (Cap. 87) and shall have all rights conferred upon legal officers by that Ordinance.

(4) The holder of an office specified in Schedule 2 may, subject to subsection (5) and any instructions of the Official Receiver, exercise the powers or perform the duties of the office of the Official Receiver.

(5) The holder of an office specified in Part II of Schedule 2 shall not exercise any right conferred by subsection (3) on the holder of an office specified in Part I of Schedule 2.

(6) The Official Receiver shall act under the general authority and direction of the Governor and shall also be an officer of the court.

(7) The Governor may, by order published in the Gazette, amend Schedule 2.

(Replaced 39 of 1992 s. 3) 76. Status of Official Receiver (1) The duties of the Official Receiver shall have relation both to the conduct of the debtor and to the administration of his estate.

(2) The Official Receiver and the holder of an office specified in Schedule 2 may take any affidavit required by any Ordinance to be made before or produced or delivered to or filed with the Official Receiver or the holder of an office specified in Schedule 2 notwithstanding any Ordinance requiring the taking of such affidavit by or before any other person.

(Replaced 39 of 1992 s. 4) (3) All provisions in this or any other Ordinance referring to the trustee in a bankruptcy shall, unless the context otherwise requires or the Ordinance otherwise provides, include the Official Receiver when acting as trustee.

(4) The trustee shall supply the Official Receiver with such information, and give him such access to and facilities for inspecting the bankrupt's books and documents, and generally shall give him such aid, as may be requisite for enabling the Official Receiver to perform his duties under this Ordinance.

[cf. 1914 c. 59 s. 72. U. K.] 76A. Transitional provision (1) Any thing done before the commencement of the Bankruptcy (Amendment) Ordinance 1992 (39 of 1992) by the Registrar General in the capacity of Official Receiver shall be regarded as having been done by the Official Receiver at the time when the thing was done.

(2) Any document which contains a reference to the Registrar General in the capacity of Official Receiver shall have effect on and after the commencement of the Bankruptcy (Amendment) Ordinance 1992 (39 of 1992) with the substitution for such reference of a reference to the Official Receiver.

(3) In any legal proceedings pending on the commencement of the Bankruptcy (Amendment) Ordinance 1992 (39 of 1992) to which the Registrar General in the capacity of Official Receiver is a party, the Official Receiver shall as from such commencement be substituted as a party thereto in lieu of the Registrar General and the proceedings shall continue as if the Official Receiver had always been that party.

(4) It this section, "Registrar General" means the Registrar General appointed under section 2 (1) of the Registrar General (Establishment) Ordinance (Cap. 100). (Added 39 of 1990 s. 5) 77. Duties of Official Receiver as regards the debtor's conduct As regards the debtor, it shall be the duty of the Official Receiver- (a) to investigate the conduct of the debtor and to report to the court, stating whether there is reason to believe that the debtor has committed any act which constitutes an indictable offence under this Ordinance or which would justify the court in refusing, suspending or qualifying an order for his discharge; (Amended 33 of 1939; G. N. 840 of 1940 Supp.

Schedule; 50 of 1991 s. 4) (b) to conduct the public examination of the debtor; (c) to take such part and give such assistance in relation to the prosecution of any fraudulent debtor as the Attorney General may direct.

(Amended 33 of 1939; G. N. 840 of 1940 Supp. Schedule; 20 of 1948 s. 4) [cf. 1914 c. 59 s. 73 U. K.] 78. Duties of Official Receiver as to debtor's estate (1) As regards the estate of a debtor, it shall be the duty of the Official Receiver- (a) pending the appointment of a trustee, to act as interim receiver of the debtor's estate, and where a special manager is not appointed, as manager thereof; (b) to raise money in any case where in the interests of the creditors it appears necessary so to do; (c) to summon and preside at the first meeting of creditors; (d) to issue forms of proxy for use at the meetings of creditors; (See Forms 50, 51) (e) to report to the creditors as to any proposal which the debtor may have made with respect to the mode of liquidating his affairs; (f) to advertise the receiving order, the date of the creditors' first meeting and of the debtor's public examination, and such other matters as it may be necessary to advertise; (See Form 27) (g) to act as trustee during any vacancy in the office of trustee; (h) to assist the debtor in preparing his statement of affairs in case the debtor has no solicitor acting for him and is unable properly to prepare it himself, and for this purpose he may employ at the expense of the estate any person or persons to assist in its preparation.

(2) For the purpose of his duties as interim receiver or manager the Official Receiver shall have the same powers as if he were a receiver and manager appointed by the court, but shall, as far as practicable, consult the wishes of the creditors with respect to the management of the debtor's property, and may for that purpose, if he thinks it advisable, summon meetings of the persons claiming to be creditors, and shall not, unless the court otherwise orders, incur any expense beyond such as is requisite for the protection of the debtor's property or the disposing of perishable goods.

(3) The Official Receiver shall account to the court and pay over all moneys and deal with all securities in such manner as the court from time to time directs. [cf. 1914 c. 59 s. 74 U. K.] PART V TRUSTEES IN BANKRUPTCY Official name 79. Official name of trustee The official name of a trustee in bankruptcy shall be "the trustee of the property of a bankrupt" (inserting the name of the bankrupt), and by that name the trustee may hold property of every description, make contracts, sue and be sued, enter into any engagements binding on himself and his successors in office, and do all other acts necessary or expedient to be done in the execution of his office.

[cf. 1914 c. 59 s. 76 U. K.] Appointment 79A. Disqualification for appointment as trustee No person being an undischarged bankrupt and no body corporate shall be qualified for appointment to the office of trustee, and- (a) any appointment made in contravention of this section shall be void; and (b) where any such person or any body corporate acts as trustee, such person or body corporate shall be liable to a fine of $5,000.

(Added 47 of 1984 s. 11) 79B. Corrupt inducement affecting appointment as trustee Any person who gives or agrees or offers to give to any creditor of a debtor or bankrupt any valuable consideration with a view to securing his own appointment or nomination, or to securing or preventing the appointment or nomination of some person other than himself, as the trustee shall be liable to a fine of $5,000.

(Added 47 of 1984 s. 11) 80. Power to appoint joint or successive trustees (1) The creditors may, if they think fit, appoint more persons than one to the office of trustee and, when more persons than one are appointed, shall declare whether any act required or authorized to be done by the trustee is to be done by all or any one or more of such persons, but all such persons are in this Ordinance included under the term "trustee" and shall be joint tenants of the property of the bankrupt.

(2) The creditors may also appoint persons to act as trustees in succession in the event of one or more of the persons first named declining to accept the office of trustee or failing to give security, or of the appointment of any such person not being approved by the court.

[cf. 1914 c. 59 s. 77 U. K.] 81. Proceedings in case of vacancy in office of trustee (1) If a vacancy occurs in the office of a trustee the creditors in general meeting may appoint a person to fill the vacancy and thereupon the same proceedings shall be taken as in the case of a first appointment.

(2) The Official Receiver shall, on the requisition of any creditor, summon a meeting for the purpose of filling any such vacancy.

(3) If the creditors do not within 3 weeks after the occurrence of a vacancy appoint a person to fill the vacancy, the Official Receiver shall report the matter to the court, and the court may appoint a trustee.

(4) During any vacancy in the office of trustee the Official Receiver shall act as trustee.

[cf. 1914 c. 59 s. 78 U. K.] Control over trustee 82. Discretionary powers of trustee and control thereof (1) Subject to the provisions of this Ordinance, the trustee shall, in the administration of the property of the bankrupt and in the distribution thereof amongst his creditors, have regard to any directions that may be given by resolution of the creditors at any general meeting or by the committee of inspection, and any directions so given by the creditors at any general meeting shall, in case of conflict, be deemed to override any directions given by the committee of inspection.

(2) The trustee may from time to time summon general meetings of the creditors for the purpose of ascertaining their wishes, and it shall be his duty to summon meetings at such times as the creditors, by resolution, either at the meeting appointing the trustee or otherwise may direct, and it shall be lawful for any creditor, with the concurrence of one-fourth in value of the creditors (including himself), at any time to request the trustee or Official Receiver to call a meeting of the creditors, and the trustee or Official Receiver shall call such meeting accordingly within 14 days: Provided that the person at whose instance the meeting is summoned shall, if so required, deposit with the trustee or the Official Receiver, as the case may be, a sum sufficient to pay the costs of summoning the meeting, such sum to be repaid to him out of the estate if the court so directs.

(3) The trustee may apply to the court in manner prescribed for directions in relation to any particular matter arising under the bankruptcy. (See Forms 131, 132) (4) Subject to the provisions of this Ordinance the trustee shall use his discretion in the management of the estate and its distribution among the creditors. [cf. 1914 c. 59 s. 79 U. K.] 83. Appeal to court against trustee If the bankrupt or any of the creditors or any other person is aggrieved by any act or decision of the trustee, he may apply to the court, and the court may confirm, reverse or modify the act or decision complained of, and make such order in the premises as it thinks just.
| 1 | 2 | 3 | 4 |