AMP RESOURCES LTD v. INDAGRO SA

HCMP 1487/2025

[2026] HKCFI 784

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO 1487 OF 2025

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BETWEEN

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DECISION

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INTRODUCTION

1.  This is the substantive determination of AMP Resources Limited, the Plaintiff’s Summons dated 9 September 2025 (the “Continuation Summons”) seeking to continue the ex parte injunction order made by DHCJ Segal on 9 September 2025 (“Ex Parte Injunction Order”) which restrained Indagro SA, the Defendant, from presenting a winding up petition against the Plaintiff.

2.  This Court will also deal with the costs of the Defendant’s Summons for setting aside the Plaintiff’s substituted service of the Concurrent Originating Summons on the Defendant (the “Defendant’s Summons”).

MATERIAL FACTS

3.  The Plaintiff and the Defendant’s underlying contractual dispute was resolved in favour of the Defendant by a Final Award issued by the China International Economic and Trade Arbitration Commission (“CIETAC” or the “Tribunal”) on 22 July 2025 (“Award”).

4.  The Plaintiff submits that the Award is not recognised in Hong Kong.

5.  The Defendant issued a statutory demand against the Plaintiff based on the Award on 14 August 2025 (the “SD”).

6.  In the meantime, the Plaintiff has applied to set aside the Award in the supervisory court, i.e. Beijing No. 4 Intermediate People’s Court (the “Beijing Court”). The setting aside application was made on 18 August 2025 (the “Setting Aside Application”).

7.  Mr Liu for the Plaintiff submitted that, most strangely, the Defendant (notwithstanding it having prevailed in the arbitration) has refused to engage with the Plaintiff on the merits of its Setting Aside Application before the Beijing Court.

8.  It is submitted that one would expect that, if the Defendant were serious about its contention, the Defendant would have actively participated in the Setting Aside Application and defended the Award. This was not done. Instead of addressing the Plaintiff’s challenge head-on, the Defendant chose not to enter an appearance in the Setting Aside Application.

9.  Mr Liu stressed that the Defendant instructed PRC lawyers to participate in the CIETAC arbitration. There is no question of the Defendant having access to PRC lawyers. Yet, on the eve before the first hearing in the Setting Aside Application, the Plaintiff discovered from the Beijing Court that those lawyers were no longer retained by the Defendant. The Defendant simply did not show up at the hearing before the Beijing Court. As a result, the Plaintiff has to effect service on the Defendant in Switzerland by diplomatic means and is still in the process of doing so.

10.  The Setting Aside Application, though commenced by the Plaintiff in August 2025, is now adjourned to a hearing on 24 November 2026 before the Beijing Court. I have to say that this is regrettable because had the Defendant chosen to engage with the Setting Aside Application, the same might already have been decided by now given the normal efficiency of the Mainland Courts.

11.  Mr Liu also submitted that the Defendant’s evasive stance in the Setting Aside Application is telling and speaks volumes as to its lack of conviction in defending the Award.

12.  For the purpose of the injunction application, the Plaintiff only relies on one single and crisp dispute as the bona fide dispute over the Award, namely, the absence of a valid arbitration agreement. The Plaintiff’s case is that:-

(1) The Plaintiff never signed the underlying written contract that contains the arbitration clause. This is not disputed by the Defendant. The final draft only bears the Defendant’s signature.

(2) The lack of signature is notwithstanding the exchange of various rounds of draft contracts. Whilst some of the drafts contain an arbitration clause, the Plaintiff’s case is that the exchange of drafts confirms the parties’ intention all along that there is no binding agreement (and no binding arbitration agreement) before the contract is formally executed by both parties’ signatures.

(3) The jurisdiction challenge was also raised in the arbitration. In the Award, the Tribunal ruled against the Plaintiff on the jurisdiction challenge. Nevertheless, the Beijing Court will be tasked with a substantive and fresh review of the jurisdiction issue, there being no suggestion that the Tribunal’s ruling would in any way fetter the Beijing Court’s ruling.

(4) Before this Court, both the Plaintiff and the Defendant adduced PRC law evidence. There is a live and serious dispute on the conclusions in the PRC law evidence.

13.  Given the parties’ dispute on PRC law, and that the matter is now before the Beijing Court, there is no reason why the Plaintiff should face the risk of a winding-up petition. Indeed, “[t]he fact that there is conflicting factual evidence (credible evidence) which needs to be tried is normally enough to justify the presentation of the petition being restrained” (emphasis added): Aggressive Construction Company Lt v SKK (HK) Co Ltd [2025] HKCFI 4536 at §14 per DHCJ Segal.

14.  Mr Liu submitted that the dispute before the Court is a very straightforward one, and the Court should have no difficulty in continuing the ex parte injunction order made by DHCJ Segal on 9 September 2025.

15.  Mr Lam SC for the Defendant, on the other hand, submitted that first, there is no bona fide substantial dispute regarding the arbitral debt. The key question here is whether a valid arbitration agreement had been concluded. There plainly was. Even a brief examination of the relevant PRC law evidence and the facts reveal that AMP’s argument lacks substance:

(1) Under the PRC law, an arbitration agreement is severable from the underlying contract. Thus, an arbitration agreement can be effective irrespective of whether the substantive contract is eventually concluded.

(2) Without prejudice to the fact that a substantive contract was in fact concluded (as rightly found by the arbitral tribunal), signing is not a necessary condition for the valid formation of the arbitration agreement, which can be concluded simply through offer and acceptance via electronic data interchange such as emails and texts.

(3) Here, the Plaintiff and the Defendant clearly reached a final agreement on, inter alia, the CIETAC arbitration clause through their email correspondence on 12 July 2023.

(4) The Plaintiff’s subsequent refusal to countersign the separate underlying contract is irrelevant. Importantly, there is no evidence to suggest that the Plaintiff and the Defendant had agreed that their arbitration agreement would only be valid and binding if it was signed by both parties.

16.  Secondly, there was in any event serious material non-disclosure (MND) in the Plaintiff’s ex parte application regarding the merits of its argument that there was no binding arbitration agreement. The Plaintiff failed to (1) explain to DHCJ Segal the merits of its argument by reference to substantive PRC law evidence, (2) refer to matters of substantive PRC law which could potentially be raised by the Defendant regarding the valid formation of the arbitration agreement (including specifically the matters mentioned in Mr Zhou Yi’s Mainland Chinese Legal Opinion dated 5 November 2025), (3) draw DHCJ Segal’s attention to the parties’ actual chain of email correspondence when suggesting that the parties agreed only to be bound by the arbitration agreement in a signed written contract.

17.  The Plaintiff is a Hong Kong company that trades fertilisers and chemical products and is an affiliate of Ampro (Shanghai) Chemical Co. Ltd (“Ampro Shanghai”), a PRC company. The Defendant is a company incorporated in Switzerland.

18.  The dispute arose from the parties’ contractual arrangements for the sale and purchase of urea fertiliser. At Award §49, the Tribunal found that an agreement was formed on 26 June 2023 between the Defendant and Ampro Shanghai regarding the core terms for the sale and purchase of 25,000 tons of urea. Thereafter, in July 2023, the Plaintiff engaged in a series of email correspondence with the Defendant to negotiate the remaining terms of the sales contract, under which the Plaintiff (instead of Ampro Shanghai) was nominated and would act as the seller.

19.  On 6 July 2023, Mr Chunming Cong (for the Plaintiff) sent Mr Benoit Selignac (for the Defendant) a draft sales contract back-dated 26 June 2023, in which the Plaintiff was named the seller of the goods. The draft contract included two different arbitration clauses, one in favour of CIETAC arbitration and another in favour of Hong Kong arbitration (see clause 5 and 7 under AMP’s General Terms and Conditions).

20.  On 7 July 2023, Ms Joanna Karabela (for the Defendant) replied to Mr Cong with alterations to the draft, including deletion of the CIETAC arbitration clause from the General Terms and Conditions.

21.  On 10 July 2023, Mr Cong wrote back to Ms Karabela proposing HKIAC arbitration, but subsequently reinserted the CIETAC arbitration clause. The arbitration clause expressly states that disputes over the existence and validity of the sales contract should be subject to CIETAC arbitration.

“In case any dispute is incurred arising from or in connection with performance of the Contract, including contract existence, validity or termination, the parties shall try to settle the dispute through amicable negotiation. If the parties cannot reach agreement within (60) days, the dispute shall be brought to the … (CIETAC) for arbitration…” (emphasis added)

22.  On 12 July 2023, Ms Karabela replied to Mr Cong, attaching the latest version of the contract without further amendments to the CIETAC arbitration clause:

“Thank you Chunming.

May I please ask you confirm all other points OK by you and only for those you commented in green to apply for internal confirmation? Attached the last version of the contract whereby I have inserted all below for final checking before we sign it”.

23.  Later that day, Mr Cong replied to Ms Karabela, confirming that apart from one particular term, all other terms (including the CIETAC arbitration clause) were agreeable to the Plaintiff:

“Please see our comments in the contract.

As for Inspection: Quantity shall be established by Draft Survey performed by seller’s surveyor.

Other terms are fine with us.” (emphasis added)

24.  Subsequently, Ms Karabela emailed Mr Cong saying that the Defendant would “print and sign attached final version of contract basis all below exchanges” and enclosed the final version of the contract accepting Mr Cong’s above proposed term on quantity inspection.

25.  Mr Lam SC submitted that the parties therefore had a consensus ad idem on all the terms in the contract. On the same day, Ms Esti Martinez (for the Defendant) sent Mr Cong the signed contract.

26.  Within two weeks, the Plaintiff informed the Defendant that it encountered a supplier issue as its upstream supplier sought to default on AMP’s contract with them. The Plaintiff then sought to renege on the contract with the Defendant, claiming that the contract had not been concluded since the Plaintiff did not countersign it.

27.  On 26 July 2023, Ms Martinez sent a firm response to Mr Cong, stating that “the final wording of all terms and conditions of the contract was agreed on 12 July 2023, upon which [the Defendant] immediately sent you the contract duly signed by [the Defendant]. Whether or not you signed the contract is irrelevant as to its formation…Thus, you are bound to comply with your obligations, as agreed”.

28.  On 27 July 2023, Ms Martinez again wrote to Mr Cong, stating that “With all due respect, your discussions with your supplier are irrelevant to our contract, which is with AMP Resources Limited. Hence, we expect you to perform your obligations”.

29.  On 28 July 2023, Ms Martinez sent Mr Cong a further email, stating that “[The Defendant’s] contract is with AMP Resources Ltd only…Your obligation towards us arise from the contract between AMP Resources Ltd and Indagro. Your upstream supplier is not party to the contract…”.

30.  Mr Lam SC submitted that the above exchanges demonstrate, the Defendant’s clear position at the material time was that the Plaintiff was bound by the sales contract, and that a valid contract had been formed notwithstanding the Plaintiff’s refusal to countersign it.

31.  I have to say that if Hong Kong laws apply, I will have no hesitation to come the view that there are no bona fide disputes to the Defendant’s claims under the Award and the application for the injunction application should be dismissed.

32.  However, the critical issue here is the parties agree that the governing law is the laws of the PRC. Hence, the parties have adduced PRC expert legal opinions on the very issue in dispute.

33.  Understandably, the Defendant heavily relies on the Award which finds, inter alia, that:

(1) The arbitration agreement was binding on the Plaintiff and the Defendant and was formed after it was revised by the parties and confirmed in writing in the email attachments (Award §§70-73).

(2) PRC law was the law applicable to the parties’ dispute resolution clause (Award §79).

(3) As to the governing law of the sales contract, the Tribunal referred to the parties’ choice of “Incoterms 2020” as well as PRC law and held that it shall also apply the United Nations Convention on Contracts of the International Sales of Goods (“CISG”) (Award §§74-78).

(4) The Plaintiff breached the sales contract by, inter alia, failing to deliver the agreed goods (Award §88), and was accordingly liable to pay the Defendant the total sum of USD2,833,835.66 (the “Debt”) (Award §122).

34.  However, as mentioned above, on 18 August 2025, the Plaintiff applied to set aside the Award in the Beijing Court (Case No. (2025) 京04民特1722号). Three grounds were raised. However, for the present purposes, the Plaintiff only relies on the content that under PRC laws, there is no concluded arbitration agreement between the Plaintiff and the Defendant.

35.  The hearing of the Setting Aside Application is to take place on 24 November 2026. It will involve, inter alia, the above self-contained and discrete PRC law point. As set out above, the Beijing Court registered the Plaintiff’s application on 21 August 2025 and summoned a first hearing to be heard on 19 September 2025. However, the Beijing Court adjourned the hearing to 24 November 2026, requiring the Plaintiff to translate the case documents into French for service via diplomatic channels. I find this to be unnecessary had the Defendant been interested in resolving the dispute issue swiftly and efficiently.

APPLICABLE LEGAL PRINCIPLES

36.  The legal principles governing injunctions to restrain winding up petitions are well established. The parties cited similar authorities to this Court. In Re Sinom (Hong Kong) Ltd [2009] 5 HKLRD 487 at §§9-12, Kwan J (as she then was) held that:

(1) The Court will grant a quia timet injunction to prevent the presentation of a winding-up petition which it considers would be an abuse of process. A petition may be restrained from proceeding where there is a bona fide dispute of the debt on substantial grounds, as well as where the company has a genuine and serious cross-claim against the petitioner greater than or equal to the petitioner’s debt.

(2) Great circumspection must be exercised in doing so, as the right to petition for winding-up in appropriate circumstances is a right conferred by statute. A would-be petitioner should not be restrained from exercising it except on clear and persuasive grounds.

37.  Specifically, on whether a petition would be considered as an abuse of process, G Lam J (as he then was) in Re Synergy Lighting Limited [2020] HKCFI 2490 at §3 said:

“If it is demonstrated that a petition would be bound to fail, it could be said that to present it would constitute an abuse. The usual ground on which it is said that a petition would be bound to fail, and should therefore be prevented by injunction, is that the debt is bona fide disputed on substantial grounds. Where that is shown to be the case, the person claiming the debt is not established to be a creditor, and is not entitled to present a petition for winding‑up: Mann v Goldsteain [1968] 1 WLR 1091.”

38.  In Re Hung Yip Engineering Company Limited [2021] 1 HKLRD 860, Harris J noted at §16 that “[w]hat constitutes an abuse of process in this context has been considered by me in cases in which a petition has been dismissed and a company suggests that the petitioner knew at the time the petition was presented, or should have appreciated, that the Company had a bona fide defence on substantial grounds and that in such circumstances presentation of a petition was an abuse of process and justified ordering costs on an indemnity basis.”

39.  As a matter of principle, when a winding up petition is based on a debt under an arbitral award, the Court still needs to consider whether there is a bona fide dispute on substantial grounds: Re Sun Fung Timber Company Limited [2021] HKCA 1660 at §§21-28 per Barma JA.

40.  Mr Liu cited and relied on the case of Mobikom Sdn Bhd v Inmiss Communications Sdn Bhd [2007] 3 MLJ 316, but I do not agree that the mere existence of the Setting Aside Application itself gives rise to a bona fide dispute of the awarded debt. The Court has an independent duty to assess the nature and quality of the dispute being put forward as a defence to the awarded debt.

41.  The Hong Kong Court should always use its own legal training to scrutinize expert evidence, especially where the concepts involved are not very different from Hong Kong law: 信达澳亚基金管理有限公司v 宜华生活科技股份有限公司 [2024] HKCFI 1957 at §6.8.

ANALYSIS AND DETERMINATION

42.  Mr Liu for the Plaintiff submits that the question boils down to whether, as a matter of PRC laws, the Plaintiff’s lack of signature on the draft contract gives rise to a bona fide dispute on the validity of the arbitration agreement in the draft contract.

43.  The Plaintiff’s PRC lawyer’s (Tian Yuan Law Firm, 天元律师事务所) opinion is that “基于我们审阅本案相关材料及相关法律规定，我们认为，（2025）中国贸仲京裁字第1755号裁决书存在以下三种情形： (1) 当事人在合同中没有订有仲裁条款或事后没有达成书面仲裁协议的…… 因此，贵司申请撤销该裁决具有法律依据，（2025）中国贸仲京裁字第1755号裁决书存在被撤销的可能.”

44.  The Defendant’s expert (Zhou Yi of Co-Effort Law Firm LLP, 协 力律师事务所) disagrees. In gist, he opines, by reference to case law where PRC courts “found arbitration agreements (validly) formed even if they (or the contracts containing them) were not signed or sealed”, he opined that “[i]t cannot be seriously disputed that AMP is bound by the arbitration agreement”, and “signing/sealing is not an absolute prerequisite for the valid formation of an arbitration agreement”.

45.  Mr Liu for the Plaintiff submits that there is clearly a dispute on the state of PRC law before this Court. Ultimately, each case turns on its own facts, and the matter has already been seised by the Beijing Court. This Court need not delve into the substance of the experts’ opinions and substantively resolve the matter.

46.  I disagree. The Court cannot proceed on the basis that just because there is a difference in views between the two PRC law experts, therefore, ipso facto, there is a bona fide dispute. This Court is duty bound to study the respective legal opinions in detail and come to a view on whether there are serious and bona fide issues in dispute which have to be resolved in the Beijing Court.

47.  As a matter of survey of the PRC law authorities, I agree that there is no dispute that (1) there is a doctrine of severability, in the sense that, the validity and existence of an arbitration agreement is independent from the validity and existence of the underlying contract and (2) a contract (and an arbitration agreement) can be formally concluded without being signed or sealed.

48.  However, critically, Mr Liu for the Plaintiff relies on an exception or a rule which is peculiar under the PRC laws. The exception is where the parties agreed to adopt a written contract (“采用合同书形式订立合同”).

49.  This exception is provided under Article 490 of the Civil Code, which states that “当事人采用合同书形式订立合同的，自当事人均签名，盖章或者按指印时合同成立。在签名、盖章或者按指印之前，当事人一方已经履行主要义务，对方接受时，该合同成立” (emphasis added).

50.  The Plaintiff’s PRC lawyer set out the analysis as to why it can be concluded from the parties’ email exchange that they did intend to adopt a written contract (合同书形式). In essence, it is suggested that although the words “Subject to Contract” are not printed on the exchange of correspondence, applying PRC laws’ canon of constructions, the net effect is that the subject contract will only take effect after both parties duly execute and sign their authorized names on the written contract.

51.  Mr Lam SC referred this Court to Zhou’s PRC Legal Opinion §§21b-22, for the proposition that an arbitration agreement exists independently, and so the effectiveness of an arbitration agreement is not impacted even if the contract is not formed. This is illustrated by the Supreme People’s Court’s Guiding Case No.196 (“Guiding Case No.196”), which is a de facto binding precedent.

52.  In that case, parties exchanged over emails draft contracts containing an arbitration clause and reached an agreement on the contents of the contracts. The Supreme People’s Court noted the principle of severability of arbitration agreements, found that the parties validly agreed to an arbitration clause in the draft contracts even though only one party eventually signed them, and held that it was unnecessary to further examine whether the contracts were themselves established (Zhou’s PRC Legal Opinion §22).

53.  Mr Lam SC submitted that Guiding Case No. 196 is directly on point. However, Mr Liu has a point that Guiding Case No.196 did not consider the applicability of Article 490 of the Civil Code. It merely represents the endorsement of the doctrine of severability.

54.  Mr Lam SC argued forcefully that if Article 490 of the Civil Code was applicable, it would not have escaped the attention of the Supreme Peoples’ Court. That might well be right. However, I am not entirely sure that if Article 490 of the Civil Code was not relied upon by the parties in Guiding Case No.196, the Supreme Peoples’ Court would nonetheless deal with it on its own volition.

55.  I note that in Zhou’s PRC Legal Opinion at §20b, he opines that Article 490 of the Civil Code is inapplicable in the present case because the arbitration agreement was negotiated by the parties through electronic data interchange and were not concluded as written contracts (i.e. not “采用合同形式订立合同”). Instead, under Article 483 of the Civil Code, an agreement is formed at the time of effective acceptance of an offer unless otherwise agreed.

56.  However, I am of the view that there is a distinction between whether an arbitration agreement was negotiated by the parties through electronic data interchange simpliciter and whether an arbitration agreement was to be concluded in written form but the drafts of the written contract (intended to be signed by the parties) were communicated through electronic means.

57.  The point on Article 490 of the Civil Code goes to the existence and validity of the arbitration agreement. The Plaintiff’s case is that the validity and existence of the arbitration agreement and the underlying contract are both governed by Article 490 of the Civil Code.

58.  Mr Liu for the Plaintiff also submitted that as a sense-check, the above is also consistent with the position under common law that “an express stipulation in the draft contract that it will be effective from “the signature” is a factor which militates against the finding of a binding contract absent signatures: Benourad v Compass Group Plc [2010] EWHC 1882 (QB) at §110 per Beatson J (as he then was).

59.  I agree with Mr Lam SC that the case of Benourad v Compass Group Plc is distinguishable. In that case, there was “an express stipulation in the draft contract that it will be effective from “the signature”” (§110). Specifically, clause 1 of the draft contract in that case stated that “the agreement will be effective… for a period of 36 months starting from the signature of the present agreement” (§§38, 109). The present email exchanges and draft contracts are not as clear.

60.  However, at the present stage, I cannot say that the Article 490 point is not a bona fide and substantial point that needs to be resolved by the Beijing Court. I am inclined to the view that there are bona fide differences on the constructions of the email exchanges and the applicability of Article 490 of the Civil Code. Both points cannot be determined summarily by this Court at this stage.

61.  The Defendant might very well prevail before the Beijing Court. If so, it can come and proceed with the presentation of a winding up petition in this jurisdiction. Viewed thus, it will be in the Defendant’s interest to get the Beijing Court to determine the Setting Aside Application as soon as possible.

62.  In relation to the Plaintiff’s reliance on the wording referring to payment to be made within 3 working days “after contract signature”. Mr Lam SC for the Defendant submitted that this payment provision, which was fully considered by the Tribunal, is not concerned with the parties’ arbitration agreement. The Tribunal was right to emphasise at Award §61 that the words “after contract signature” are only part of the payment provision in the sales contract. They do not indicate that the parties agreed that the whole contract must be signed to be binding, let alone the arbitration clause.

63.  However, I am of the view that as this is a matter to be ventilated before the Beijing Court which will deal with this argument properly, it suffices for this Court to say at this stage that this is one of the issues to be reviewed by the Beijing Court. The same reasoning applies to the arguments in relation to the fact that the Defendant did sign on the subject contract. Whether it is a matter of formality or goes to support the Plaintiff’s case on the applicability of Article 490 of the Civil Code, the Beijing Court no doubt will determine the same in one go. I cannot say that these arguments do not raise bona fide issues to be resolved.

64.  I appreciate that there is a distinction between the parties intending to have their contract signed (for whatever reasons there might be, administrative or otherwise), versus the parties expressly requiring a contract to be signed as a precondition for it to be valid. The Tribunal observed at Award §60, had any of the parties raised the latter requirement at all during the contracting process, the Tribunal might have come to a different conclusion in the Award.

65.  Mr Liu for the Plaintiff submitted that reading the email exchanges as a whole, he, in particular, referred to various places where signatures were required, the Plaintiff cannot be denied of the right to argue before the Beijing Court that the parties did intend the contract to take effect only upon the joint signatures of the parties. He stressed that in the present case, the parties agreed to adopt a written contract (“采用合同书形式订立合同”). I agree that this is a legitimate and bona fide dispute to be resolved by the Beijing Court.

66.  For the sake of completeness, I agree with Mr Lam SC that the original stance taken by the Defendant in the arbitration should have no impact on the analysis.

MATERIAL NON-DISCLOSURE

67.  The Defendant also relied on the ground of material non-disclosure to resist the continuation of the Ex Parte Injunction Order.

68.  First, the Defendant contends that the Plaintiff “failed to properly draw to the Court’s attention the substantive merits (or the lack thereof) of the “No Valid Arbitration Agreement” argument in its Setting Aside Application”, and that “[n]o attempt was made to explain to the Court the actual merits of AMP’s contentions as a matter of Mainland Chinese law”.

69.  The complaint focusses on the failure of the Plaintiff to draw to the ex parte judge’s attention to the distinction between the validity of the arbitration and the validity of the underlying contract. DHCJ Segal is a very experienced commercial judge. The severability doctrine will not have escaped his attention.

70.  Mr Liu for the Plaintiff submitted that the Plaintiff’s PRC lawyer prepared a legal memorandum, which was shown to DHCJ Segal at the hearing. The merits of the Plaintiff’s contentions were opined in the legal memorandum.

71.  Importantly, from the transcript, DHCJ Segal was clearly on top of the crux of the dispute. He eventually came to the conclusion that “I am satisfied that there is at least a prima facie case that you have made out for saying that the presentation of a petition would be an abuse of process on the basis that the underlying award, upon which any petition would be based, is bona fide disputed on substantial grounds, in light of the setting aside application that has been made and in particular in light of the plaintiff’s claim that the tribunal was in error in determining on the evidence that there was both sufficient consensus to give rise to an agreement to supply and also an arbitration agreement , and in particular the defendant’s -- excuse me the plaintiff’s assertion, which it says is supported in evidence, that the parties understood and agreed and accepted that they should only become bound, both in relation to the supply contract and in relation to the arbitration agreement, in the event of there being a written agreement”.

72.  I agree that the learned Judge was acutely aware of the need to test the Plaintiff’s position and was eventually satisfied as to the merits of the Plaintiff’s challenge. The learned Judge was taken to the analysis in (i) various paragraphs in the Award, (ii) the Setting Aside Application, and (iii) the Plaintiff’s jurisdiction challenge in the CIETAC arbitration.

73.  I also agree that DHCJ Segal was fully aware of what was stated in the Award by the Tribunal. He correctly understood the Plaintiff’s complaint, and “the heart of it is a challenge to the determination that the tribunal has made on the evidence” on the existence of the arbitration agreement and the parties’ intention.

74.  As he observed at the hearing, the Plaintiff’s “fundamental point is you say the tribunal got it wrong on the evidence … Misinterpreted the email evidence because the email evidence, you say, isn’t sufficient to establish a consensus and contractual relations because, properly understood, what the communications between the parties established was that legal relations would be subject to a written contract”. This will be the main issue before the Beijing Court.

75.  DHCJ Segal asked, and answers were given, as to the legal basis for the Setting Aside Application. References were made to the PRC Law of Civil Procedure and §§8-9 of the legal memorandum prepared by the Plaintiff’s PRC lawyer. The learned Judge dutifully scrutinised the merits of the Setting Aside Application.

76.  Secondly, the Plaintiff did not misrepresent the effect of the Setting Aside Application. I agree that the Plaintiff never submitted that the enforcement of the Award can be stayed even if there is no extant proceeding to enforce the Award. It was not the Plaintiff’s case that the mere existence of the Setting Aside Application by itself automatically warrants the grant of injunction, or results in bona fide dispute on the Award. In the Plaintiff’s ex parte skeleton at §38, it referred to the Court of Appeal’s case in Re Sun Fung Timber for the proposition that the presentation of a winding up petition does not constitute enforcement of either a judgment or an arbitration award.

77.  Thirdly, I am of the view that the Plaintiff has properly disclosed its financial position. It did exhibit its latest audited financial statement and there is no evidence of any material change in its financial position.

78.  Finally, I agree that after all, “[t]he court takes a realistic view and draws sensible limits in applying the broad test of materiality, otherwise an impossible burden would be placed on applicants and their advisers and the court may open itself to “counter-abuse”. The ultimate touchstone is whether the presentation of the application is fair in all material respects”: Haitong International Products & Solutions Ltd v Wang Yafeng [2025] HKCA 821 at §17 per Kwan VP. See also principles summarised by this Court in Hou Hsiao Bing v Ren Baogen [2025] HKCFI 5024 at §§68-70.

79.  For the above reasons, I do not find that there are any material non-disclosure on the part of the Plaintiff.

THE DEFENDANT’S SUMMONS

80.  The only issue to be determined is costs.

81.  This Court is duty bound to deal with substantial issues in dispute expeditiously and has no time for procedural gamesmanship. I had indicated to the Defendant at the hearing on 14 November 2025, that (i) a substituted service order will be made against the Defendant if the Defendant’s solicitors (Tang & Co) do not accept service, and (ii) whilst Tang & Co’s acceptance of service will render the Defendant’s Summons academic, the parties are at liberty to make submissions on costs.

82.  Tang & Co confirmed on 17 November 2025 that they have instructions to accept service of the Concurrent OS. Service was duly effected by the Plaintiff on 24 November 2025.

83.  But for Tang & Co’s confirmation to accept service of the Concurrent OS, this Court would have no hesitation to make an order for substituted services because the Defendant cannot on the one hand engages a Hong Kong law firm to serve a statutory demand on the Plaintiff in Hong Kong but on the other hand refuses to accept the services of the Concurrent OS. Mr Lam SC fairly accepts that there are no good explanations.

84.  Had the Defendant acted sensibly to accept services through a local law firm, there will be no need for the Plaintiff to apply, ex parte, to serve the same by way of substituted service. The analysis will be different had the Defendant not attempted to serve the statutory demand and intended to invoke the insolvency jurisdiction of the Hong Kong Courts.

85.  Tang & Co is recorded as the Defendant’s “Solicitors for the Creditor [i.e. the Defendant]” in the Statutory Demand dated 14 August 2025.

86.  On 19 August 2025, the Plaintiff had notice of the Statutory Demand.

87.  On 29 August 2025, the Plaintiff engaged Hong Kong lawyers (Chen & Lee).

88.  On 1 September 2025, Chen & Lee wrote to Tang & Co, asking them to confirm if they had instructions to accept service.

(1) On the same day, Tang & Co replied that “we do not yet have any instructions from our clients to accept service of any application that may be made by your clients in respect of any injunction that your clients may choose to take out”.

(2) On 2 September 2025, the Plaintiff lodged the ex parte application. Notice was given to the Defendant and Tang & Co.

(3) On the same day, Tang & Co stated again “we have no instructions for any undertaking to be provided to your clients, or to accept any service of Court papers in respect of your clients’ proposed injunction application”. Tang & Co also asked Chen & Lee to retrieve the injunction papers.

(4) However, Tang & Co did send representatives to attend the ex parte hearing. It consistently refused to accept service of the Concurrent OS until 17 November 2025.

89.  On the above facts, the irresistible inference this Court draws is that the Defendant tried its best to avoid or delay the present hearing. In L v R [2024] HKCFI 1611 at §30, the Court rightly observed that:

“[T]he fact that R’s solicitors had refused to accept service of the Originating Summons on behalf of R in these proceedings, whilst at the same time acting for R in other proceedings, gives rise to a strong inference of evading service, or game playing” (emphasis added)

90.  Indeed, “an order for substituted service may be made if a defendant is evading service or otherwise ‘game playing’”: P v D [2025] HKCFI 5424 at §10.7 per DHCJ Jonathan Wong; see also §10.13. “Once the case of ‘game playing’ was made out … it was perfectly possible to make an order for substituted service on a Mainland-based defendant’s solicitors and such order would not contravene RHC Order 11, rule 5A” (at §10.16).

91.  Had the Defendant acted sensibly, no costs in relation to the application for substituted service order would have to be incurred.

92.  Secondly, having been served through the substituted service order, I find it a complete waste of time and costs for the Defendant to take out its Summons to set aside the same when the Court would have granted the same in any event. The Court has a positive duty to adjudicate disputes expeditiously and efficiently.

93.  Thirdly, I am not attracted by the argument that the substituted service order does not extend to the Concurrent OS. Strictly speaking, it does. The substituted service order clearly states that it extends to all “legal documents” in these proceedings. The Concurrent OS falls within the ordinary and natural meaning of “legal documents” in these proceedings. The Concurrent OS itself states that “This is a legal document. The consequences of ignoring it may be serious …” (emphasis added).

94.  Even if there is any room for debate on this issue of interpretation, I would have re-granted an order to serve the Concurrent OS on Tang & Co., without any hesitation.

95.  Fourthly, it is argued that there is material non-disclosure on the part of the Plaintiff in applying for the ex parte substituted service order before DHCJ Segal as the true ratio of the case Capital Wealth Holdings Limited v 南通嘉禾科技投资开发有限公司 [2020] HKCFI 3025.

96.  Mr Liu for the Plaintiff is correct that DHCJ Segal’s attention was expressly drawn by Counsel to ex parte Skeleton §57 and the decision of DHCJ Sit SC in Capital Wealth Holdings Limited v 南通嘉禾科技投资开发有限公司 [2020] HKCFI 3025 at §36, which held that “it is common practice in an ex parte injunction situation to grant substituted service on existing lawyers acting for the foreign party without the need to demonstrate existing difficulty in personal service, and this is to recognise an injunction by their nature would require proper notice so that substituted service would be appropriate.”

97.  The Defendant argues that Deputy High Court Judge Sit SC’s dictum does not extend to substituted service of originating document(s), and is limited to service of the injunction order only. I agree with Mr Liu for the Plaintiff that this is not so clear from the judgment. Deutsche Bank AG Hong Kong Branch v Zhang Hong Li [2016] 3 HKLRD 303, cited at §36 by Deputy High Court Judge Sit SC, concerns substituted service of a concurrent writ.

98.  Mr Lam SC for the Defendant submits that in so far as there is room for dispute as to the ratio of Capital Wealth or the effect of O.65 r.4, the points now contended by the Defendant are at least arguable and ones which the Defendant could reasonably be expected to raise in opposition to any substituted service of the Concurrent OS. I disagree. It is all a matter of degree. Whilst the Plaintiff should fully and frankly disclose potential defences by the Defendant, it is unrealistic to expect the Plaintiff to know that the Defendant would argue on the exact ambit of the ratio of Capital Wealth as it did in the inter partes hearing.

99.  The Defendant also contends that the Plaintiff did not bring to DHCJ Segal’s attention the general need to demonstrate impracticability for a substituted service order.

100.  I do not see any merits in this contention. This basic requirement must be in the mind of the learned Judge. This is also made clear by Deputy High Court Judge Sit SC’s judgment at §35, which states that “[i]t is not disputed that normally one needs to show it is impracticable to effect service through the ordinary channels and if there is no unsuccessful attempts to effect service under Order 11, rule 5A, usually it would be inappropriate to order substituted service.”

101.  From the transcript of the ex parte hearing, I note that Mr Liu did read out the above passage and went so far as to deliberately pause and highlight to DHCJ Segal the proposition that existing difficulty in personal service “is usually required for substituted service applications”.

102.  I am of the view that this procedural objection is unmeritorious and should not be encouraged. The same should be dismissed with costs on an indemnity basis.

DISPOSITION

103.  For all the reasons stated above, I make an order:

(1) In terms of the Continuation Summons;

(2) Dismiss the Defendant’s Summons with costs in favour of the Plaintiff.

104.  The Plaintiff asks for costs of its injunction on indemnity basis. Harris J held in Cosmigo Ltd v Monin Asia KI Sdn Bhd (unrep., HCMP 905/2017, 8 November 2017), as a matter of general principle, “where a statutory demand is issued and a request to undertake not to issue a petition is refused, in circumstances where it should have been appreciated by the Petitioner that there was a bona fide defence on substantial grounds, similarly, the costs of proceedings to enjoin presentation of the petition should be awarded on an indemnity basis”.

105.  I agree that the above legal principles should apply and costs are awarded to the Plaintiff on an indemnity basis on both Summonses.

106.  The Defendant is directed to file their objections to the Plaintiff’s schedules of costs within 7 days hereof and this Court will summarily assess.

107.  Finally, I thank counsel for their very helpful and able assistance.