PF GROUP HOLDINGS LTD AND ANOTHER v. LEE CHUN PONG BRUCE AND ANOTHER

CACV 67/2025

[2025] HKCA 652

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO 67 OF 2025

(ON APPEAL FROM HCA 813 OF 2024)

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REASONS FOR JUDGMENT

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Hon Barma JA (giving the Reasons for Judgment of the Court):

1.  This is an appeal by the 1^st defendant against the decision of DHCJ Alan Kwong (“the Judge”) dated 3 February 2025 (“the Decision”), by which the Judge dismissed the 1^st defendant’s ex parte application made on 27 January 2025 for leave to commence contempt proceedings, and to apply for an order of committal, against Lee Ho Leung William (“Lee”) under O.41A r.9 and O.52 r.2 of the Rules of the High Court (Cap.4A) (“the Application”).

2.  By a Notice of Appeal filed on 13 February 2025, the 1^st defendant sought orders that the Decision be set aside and that the Application be allowed.

3.  We heard the appeal on 24 June 2025. At the hearing, the 1^st defendant was represented by Mr Dexter Leung. At the conclusion of the hearing, we allowed the appeal and set aside the Decision with reasons to follow, which we now proceed to set out below.

Background

4.  The factual background to the Application, insofar as it relates to this appeal, is as follows.

5.  By an Amended Writ of Summons re-filed on 16 May 2024, the 1^st and 2^nd plaintiffs (respectively companies incorporated in the Cayman Islands and Hong Kong) commenced proceedings against the defendants for inter alia loss and damages sustained as a result of an allegedly voidable sale and purchase agreement.

6.  The plaintiffs’ Statement of Claim filed on 2 May 2024 (“the SOC”) was verified by Statements of Truth signed by Lee on 30 April 2024. In the Statements of Truth, Lee stated himself to be a director of both the 1^st and 2^nd plaintiffs and that he believed in the veracity of the facts stated in the SOC. The Application (and thus this appeal) is concerned only with Lee’s Statement of Truth signed on behalf of the 1^st plaintiff (“the SOT”).

7.  In the 1^st defendant’s Statement dated 24 January 2025 (“the Statement”), which was filed in support of the Application before the Judge, it was alleged that the SOT is false on the basis (insofar as relevant to this appeal) that Lee, as of the date of the SOT (i.e. 30 April 2024), had already on 2 January 2024 ceased to be the 1^st plaintiff’s director (“the Complaint”).

8.  A Return of Change of Company Secretary and Director of Registered Non-Hong Kong Company (Appointment/Cessation) (“the Form NN6”) dated 2 January 2024 (exhibited in the 1^st defendant’s affirmation filed in support of the Application), which was signed by the 1^st plaintiff’s Company Secretary and filed with the Companies Registry, evidences that Lee had ceased to be the 1^st plaintiff’s director as of 2 January 2024.

The Judge’s Decision and the arguments advanced on appeal

9.  The Judge referred in his Decision to established legal principles applicable to cases involving prosecutions of contempt by reason of the defendant’s making of false statements in statements of truth. In gist, the plaintiff must prove beyond reasonable doubt that (i) the statement in question was false; (ii) the statement would have likely interfered with the course of justice in a material respect; (iii) at the time of making the statement, the maker (the defendant) had no honest belief in the truth of it; (iv) any genuine doubt is to be resolved in the defendant’s favour; and (v) no specific intent to interfere with the administration of justice is necessary; it suffices for there to be an inherent likelihood so to interfere. See Carol Walton v Joanne Kirk [2009] EWHC 708; Secretary for Justice v The Oriental Press Group Ltd & Others [1998] 2 HKLRD 123.

10.  For leave to commence contempt proceedings to be granted, there need only be an arguable or prima facie case of contempt.

11.  As regards the Complaint, the Judge took the view that it did not fall within the ambit of O.41A r.9(1)[1] at all, as the SOT (even if it were false as to Lee’s status as a director of the 1^st plaintiff) was not a statement in the SOC, nor was the Complaint concerned with the falsity of the averments in the SOC. The Judge was also of the view that the definition of a “director” includes a de facto director, and there was no suggestion that Lee, notwithstanding his cessation as director on record for the 1^st plaintiff, did not nonetheless continue to serve as a de facto director. Accordingly, the Judge dismissed the Application.

12.  The grounds set out in the 1^st defendant’s Notice of Appeal against the Decision are broadly that the Judge erred (i) in holding that the SOT did not fall within O.41A, r.9(1); (ii) in speculating, without evidential basis, that Lee was a de facto director of the 1^st plaintiff; (iii) in concluding that the 1^st defendant failed to establish a prima facie case for contempt against Lee; (iv) in disposing of the Application on paper rather than by way of an oral hearing.

13.  By his written submissions lodged on 27 May 2025 (“D1’s Skel”) and his oral submissions at the hearing of the appeal, Mr Dexter Leung for the 1^st defendant contended inter alia that (i) the SOT was not a separate, standalone document to the SOC and thus the Judge’s relevant analysis in the Decision was incorrect (D1’s Skel, [16]-[18]); (ii) according to O.41A r.3(5), where a statement of truth is signed by a person holding a senior position, that person shall state therein the position “he holds”, which Lee had failed to do; (iii) the Judge should have only considered, but failed to consider, the question of whether a prima facie case for contempt had been made out.

Discussion

14.  We agree with Mr Leung’s submission that at the leave stage, the court should have been concerned only with whether contempt was arguable (or whether there was a prima facie case for contempt), rather than engage with the merits of the respondent’s defence(s) and whether there is sufficient/admissible evidence to prove such defence(s) (D1’s Skel, [11]‑[12]).

15.  Accordingly, we are of the view that the Judge’s consideration of matters concerning whether Lee could have been a de facto director at the time of signing the SOT was irrelevant for the determination of the Application. Those matters are for Lee to address at the substantive hearing, should there be a prima facie case of contempt and thus leave to commence contempt proceedings be granted.

16.  While we have reservations (without coming to any concluded view at this stage) as to Mr Leung’s submission that, essentially, the averments or facts stated in the SOT should also be taken as “the facts” within the meaning of O.41A r.5(1) (D1’s Skel, [16]-[17]), we agree that pursuant to r.3(5), a person holding a senior position in a company who signs a statement of truth is obliged to accurately state therein the office or position he holds – i.e. at the time of signing (D1’s Skel, [20]).

17.  In the SOT, Lee’s declaration reads: “I, [Lee], the Director of the 1^st Plaintiff believes that the facts stated in [the SOC] are true” (emphasis added). On plain reading, and without taking it any further, it is in our view clearly arguable that Lee was purportedly signing the SOT as the 1^st plaintiff’s director at a time when this was apparently contradicted by his cessation of the office before the date of the SOT as evidenced by the Form NN6.

18.  Thus, we allowed the appeal for the reason that the Judge should have concluded that a prima facie case for contempt of court had been made out against Lee. Accordingly, leave should have been given for the 1^st defendant to commence contempt proceedings against Lee.

Disposition

19.  For the above reasons, we allowed the appeal, and ordered that:

(a)  leave be granted to the 1^st defendant to institute contempt proceedings on the basis that the part of the SOT in which Lee stated himself to be the director of the 1^st plaintiff is reasonably arguable to constitute contempt; and

(b)  costs of this appeal and in the court below be in the cause of the contempt proceedings.