RE LAU KIT FUNG

HCB 10764/2003

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

BANKRUPTCY PROCEEDINGS NO. 10764 OF 2003

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D E C I S I O N

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1.  The Official Receiver made an application for the prosecution of the bankrupt for an offence under Section 134(1) of the Bankruptcy Ordinance.

2.  Unlike the case in Re Chu Wai Ha HCB 19401of 2003, 10 December 2004, Section 134(2) of the Bankruptcy Ordinance expressly states that a prosecution shall not be instituted against any person under Section 134 except by an order of the court.

3.  There is a conflict between Section 134(2) and Section 138 of the Bankruptcy Ordinance in this respect.  Written submissions from Mr Godfrey Lam were filed by the Official Receiver on 2 July 2005 to deal with such conflict.  Mr Lam acknowledged the apparent inconsistency and submitted that as Section 134 is the specific provision dealing the offence of keeping proper books of account, the requirement under sub-section (2) for a court order must prevail over Section 138, citing the maxim generalibus specialia derogant and the approach of Nicholls LJ (as he then was) in Re Marr [1990] 1 Ch 773 at p.784H to 785C.

4.  I am prepared to assume that this is the correct way to resolve the conflict between the two sections.  However, the application is still caught by the constitutional objection I alluded to in Re Chu Wai Ha HCB 19401of 2003.  For reasons already given in that judgment, Section 134(2) is void since it is inconsistent with the precept of separation of power enshrined in Articles 63, 80 and 85 of the Basic Law.

5.  I therefore dismiss the application by the Official Receiver.

Mr Godfrey Lam, instructed by the Official Receiver