Asset shuffle alleged in canopy case
A writ claims three company shareholders attempted to avoid paying a share of damages in a personal injuries judgment
Three company shareholders sold off properties worth $32.2 million for only $5 in an attempt to evade paying damages over the fatal collapse of a canopy in Aberdeen nine years ago, a High Court writ alleged yesterday.
Newspaper vendor Mo Yee, 76, was crushed to death when the 21-year-old canopy of New Best Restaurant in Aberdeen gave way. Eight people, including four children aged seven to 13, were injured.
Six parties were listed as defendants in the personal injuries claim which was decided by Mr Justice Azizul Suffiad in the Court of First Instance on September 17, 2001.
That ruling, which awarded $33,257,886.25, found the parties jointly liable for the August 1, 1994, incident which saw a 15-tonne canopy crash under the weight of an illegally-erected fish tank.
One of the six parties, Aberdeen Winer Investment Company, yesterday launched efforts aimed at getting three shareholders of one of the other parties, Housing Management Agency, to pay their share of the damages bill: $9,929,144.85.
Aberdeen Winer was left with the entire bill after the plaintiffs chose to enforce the entire judgment against the company and its landed properties. They took this action because some of the other defendants were bankrupted or missing.
Those targeted by Aberdeen Winer yesterday were Potter Pang, Chan Wai-cheun and Kloten Investments, all directors and shareholders of Housing Management Agency
Housing Management Agency was liable for 15 per cent of the original damages - since bolstered by interest - according to the original settlement.
Yesterday's writ, heard by Mr Justice Suffiad, claimed that in its efforts to evade having to pay up, Housing Management sold at least five properties for HK$1 each to limited companies incorporated in the British Virgin Islands. Mr Pang was also in control of the Virgin Islands companies, it was claimed.
A list of the properties attached to the writ claimed that one of the $1 properties - a two-storey flat at 14 Tregunter Path - was actually worth $27 million in July 1994.
'Clearly the above activities constitute a calculated and deliberate act of Housing Management to dispose of its real property assets in anticipation of the liability under the personal injuries judgment,' the writ said.
'The above activities were carried out by all the defendants ... deliberately and with the intent to defraud creditors of Housing Management [including Aberdeen Winer Investment] for fraudulent purpose.'
The writ stated that in the course of the hearing into the assessment of damages, the defendants 'must know or ought to know' that the Housing Management must also be liable to pay a share of the damages.
'[Aberdeen Winer Investment] is therefore entitled to contribution from Housing Management,' the writ said adding it had covered the shortfall.
