Former Executive Council member Barry Cheung Chun-yuen was on Monday ordered by the High Court to repay more than HK$33.4 million as a guarantee for a loan borrowed by his company.
This is the first court judgment made against the key supporter of Chief Executive Leung Chun-ying in relation to debts since his Hong Kong Mercantile Exchange surrendered its trading licence in May.
In November, Sinomax Finance filed a writ claiming that Cheung’s New Effort Holdings, the majority shareholder in HKMEx, failed to repay HK$30 million borrowed from Sinomax Finance in April.
The company said Cheung acted as guarantor for the loan, which was due to be repaid a month after it was taken out. The annual interest rate was 30 per cent and the company claimed the repayment deadline was later extended to the end of June.
Cheung was said to have made two interest payments of HK$750,000 each in May and August. The court heard on Monday that neither Cheung nor New Effort had made any repayment since the filing of the writ.
Lawyers for Sinomax told the court that Cheung had not responded since he was served the writ.
The court heard that New Effort would contest the claim.