LI XIAO YI v. TANG CHUNG WAH (also known as ALAN CHUNG WAH TANG)

HCMP 406/2025

[2026] HKCFI 381

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 406 OF 2025

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D E C I S I O N

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Introduction

1.  On 3 November 2025, I dismissed[1] (“Decision”)  the Defendant’s summons dated 19 September 2025 (“Recusal Summons”)  seeking an order that I recuse myself from the substantive hearing of the Originating Summons dated 14 March 2025 for an order that the Defendant be committed for contempt (“Contempt Proceeding”).  By a summons dated 17 November 2025, the Defendant seeks leave to appeal against the Decision (“Leave Application”).

2.  In the Decision, I also made a costs orders nisi (“Costs Orders”)that the Defendant pays the Plaintiff his costs of and occasioned by the Recusal Summons as well as the Plaintiff’s summons dated 6 October 2025 for a determination as to whether the Defendant should be entitled to pursue the Recusal Summons in the absence of a supporting affirmation (“Entitlement Summons”).  By a summons dated 4 December 2025, the Plaintiff seeks leave to vary the Costs Orders (“Costs Variation Application”).

Applicable Principles

3.  The applicable principles for granting leave to appeal are uncontroversial.  Under section 14AA(4) of the High Court Ordinance, Cap. 4, leave to appeal should not be granted unless the Court is satisfied that (1)  the appeal has a reasonable prospect of success or (2)  there is some other reason in the interests of justice why the appeal should be heard.  “A reasonable prospect of success” means the prospect of success must be more than fanciful, without having to be probable.[2] Circumstances in which the Court would find that there is “some other reason in the interests of justice why the appeal should be heard” are broad.  Leave may be granted if the question is one of general principle, decided for the first time or a question of importance upon which further argument and a decision of the Court of Appeal would be to the public advantage[3].

4.  My Decision involved an exercise of discretion[4]. Accordingly, the Court of Appeal would only interfere if it is demonstrated that I had reached the Decision under a mistake of law or a misapprehension as to the facts, or in disregard of principle[5], or that the Decision was “outside the generous ambit within which a reasonable disagreement is possible”[6]. It follows that the Defendant is required to identify a clear mistake of law or fact in the Decision.

Leave Application

5.  In my view, the draft Notice of Appeal (“Draft NoA”)  is essentially a rerun of the arguments advanced by the Defendant in the Recusal Summons which, as I have already explained in the Decision, are entirely without merits.

6.  In addition to the arguments advanced in support of the Recusal Summons, the Defendant argues, for the first time, in his skeleton submissions that I had demonstrated actual bias against him during the trial of HCA 1492 of 2018 (“Main Action”)  and that leave should nevertheless be granted given that I am likely to find in favour of the Plaintiff at the Contempt Proceeding which he alleges are brought against him out of personal vengeance.  These arguments are fact-sensitive and as I have mentioned were advanced in support of the original application.  Thus, I will not have regard to them in determining the Leave Application[7].

7.  The Defendant also alleges, for the first time, in the Draft NoA that I erroneously observed in the Main Action that he had been subject to a disqualification application made by the Official Receiver.  The Defendant complains that he was never cross-examined on the alleged actions taken by the Official Receiver.  The Defendant’s reliance on these matters is misplaced:

(1)  First, it is disingenuous for the Defendant to make this allegation now when neither he (nor his counsel)  had taken issue with my observation[8] during the Main Action;

(2)  Secondly, my observation is strictly speaking correct.  The Defendant was, in Re Chan John Loong Fai[9], the subject of an application made by the Official Receiver to the Court for directions as to whether he was a fit person whom the creditors could validly appoint as a trustee.  It was said that the purpose of the Official Receiver’s application was effectively to seek the removal of the Defendant as a trustee in those bankruptcy proceedings[10];

(3)  Thirdly, whether the Defendant had been cross-examined on the alleged actions taken by the Official Receiver is irrelevant; and

(4)  Fourthly, as I already held in the Decision, an expression of scepticism against the Defendant is not suggestive of bias unless I conveyed an unwillingness to be persuaded of a factual proposition whatever the evidence may be[11]. The Defendant does not allege that I did or might have had a closed mind.

8.  Relatedly, the Defendant alleges that I had demonstrated “an active judicial interest […] in future personal litigation but [sic] adverse to D” by inviting the Official Receiver to consider commencing disqualification proceedings against the Defendant, which is inconsistent with judicial impartiality.  I disagree.  In the Main Action, I found that the Defendant, in his capacity as a liquidator and an officer of the Court, had breached his disclosure obligations and was dishonest in that he had lied on affirmation and in Court.  Given the gravity of my findings, I consider my invitation to the Official Receiver to be amply justified and that it was a proportionate response in the circumstances.  It does not indicate bias.

9.  For the reasons above, I decline to grant leave to the Defendant to appeal against my Decision.  I dismiss the Leave Application.

Costs Variation Application

10.  In his Costs Variation Application, the Plaintiff seeks to vary the Costs Orders as follows:

(1)  Costs of and occasioned by the Recusal Summons be paid by the Defendant to the Plaintiff on an indemnity basis, to be summarily assessed and payable forthwith, with certificate for two counsel; and

(2)  Costs of and occasioned by the Entitlement Summons be paid by the Defendant to the Plaintiff on an indemnity basis, to be summarily assessed and payable forthwith, with a certificate for counsel.

11.  I see no reason to interfere with the Costs Orders.

(1)  Whilst I agree with the Plaintiff that the Recusal Summons was unmeritorious, which is why I have dismissed it in the first place, I am not persuaded that it was a try-on and has hence crossed the line of propriety into the category of cases that justify[12] indemnity costs.  Rather, I accept the Defendant’s submission that the Recusal Summons was a bona fide application, although it was weak and misguided.

(2)  As to the Entitlement Summons, I also agree with the Plaintiff that it was necessitated by the Defendant’s failure to file an affirmation in support of his Recusal Summons.  It should have been obvious to the Defendant’s legal team that a recusal application should be supported by an affirmation[13]. Nevertheless, I do not consider that the mistake made by the Defendant’s legal team justifies[14] indemnity costs.

Certificate for Two Counsel

12.  At the Recusal Summons, which was heard together with the Entitlement Summons on 3 November 2025, the Plaintiff was represented by a senior counsel and a junior counsel.  The Plaintiff submitted that the Contempt Proceedings (of which the Recusal Summons was part)  have important implications for the parties as well as the public in whose interest it is that objectionable conduct of the Court’s officers should be properly addressed.  For this reason, the retainment of both senior and junior counsel was justified[15]. I note that the Defendant did not make any submission in respect of the Plaintiff’s application for a certificate for two counsel in the Recusal Summons.

13.  Notwithstanding the skill and seniority of the Plaintiff’s junior counsel, as well as his involvement in the trial of the Main Action, I acknowledge the potential complexity in the arguments that might be advanced in the Recusal Summons such that it was appropriate for two counsel to be retained.  Further, I note that the Plaintiff’s senior counsel was himself involved in the trial of the Main Action and indeed the Contempt Proceedings and was, therefore, familiar with the facts.  It is not the case that the senior counsel was brought in at the last minute.  Accordingly, I allow the application and grant a certificate for two counsel in respect of the Recusal Summons.

Summary Assessment of Costs

14.  By the Costs Variation Application, the Plaintiff is seeking for a summary assessment of costs in respect of both the Recusal Summons and the Entitlement Summons.  The Plaintiff submitted that this is a suitable case for summary assessment because the costs are fairly self-contained and straightforward.  The Defendant, on the other hand, complains that the Plaintiff has not given a breakdown of the individual costs incurred in the Recusal Summons and the Entitlement Summons, and that the sum that the Plaintiff is claiming, i.e. HKD885,825, in his Statement of Costs dated 8 December 2025 is grossly excessive.

15.  I agree with the Defendant that the total sum claimed by the Plaintiff is excessive, particularly as both counsel were involved in the proceedings from the outset[16].  For this reason, I will refer the matter to a taxing master.

Disposition

16.  With regards to the Defendant’s Leave Application, I am not satisfied it can be said that I had misapprehended the law or the facts, or that my Decision fell outside the range of reasonable decisions open to me on the basis of the evidence and the arguments advanced before me.  I, therefore, dismiss the Leave Application.  I will order that the Defendant pays the Plaintiff’s costs of and occasioned by the Leave Application forthwith.

17.  As to the Plaintiff’s Costs Variation Application, I do not think that the Defendant’s conduct, whilst unsatisfactory, calls for costs to be awarded on an indemnity basis.  I also do not think there are any special, sufficient or unusual features in this case that justify the award of indemnity costs against the Defendant.  I, therefore, dismiss the Costs Variation Application.  The Costs Orders will be varied as follows:

“42(2): There be a costs order that the Defendant pays the Plaintiff the costs of and occasioned by the Recusal Summons forthwith, with a certificate for two counsel, to be taxed if not agreed.

42(4): There be a costs order that the Defendant pays the Plaintiff the costs of and occasioned by the Entitlement Summons forthwith, with a certificate for counsel, to be taxed if not agreed.”

Lastly, I will order that the Plaintiff pays the Defendant the costs of and occasioned by the Costs Variation Application, to be taxed if not agreed.