RE CHINA PROPERTIES GROUP LTD

CACV 197/2023, [2025] HKCA 636

On Appeal From [2023] HKCFI 1500

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 197 OF 2023

(ON APPEAL FROM COMPANIES

(WINDING-UP) PROCEEDINGS NO. 67 of 2022)

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DECISION

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Hon Cheung JA (giving the Decision of the Court) :

I.  Introduction

1.  On 18 March 2025, we dismissed the appeal by China Properties Group Limited (‘the Company’) against the judgment of Anthony Chan J dated 31 May 2023 who, upon the amended petition (‘the petition’) presented by JIC Trust Co., Ltd (‘the Petitioner’), ordered the winding-up of the Company. We also dismissed the Company’s application to adduce new evidence for the appeal and to amend the notice of appeal.

2.  On 25 March 2025, we handed down our reasons for judgment (‘Judgment’). Unless otherwise stated, we will adopt the terms and expressions in the Judgment.

3.  By a Notice of Motion dated 15 April 2025 (‘Notice of Motion’), the Company applied for leave to appeal to the Court of Final Appeal. We will deal with the application on paper.

II.  The grounds

4.  The Company relies on three questions said to be of great general or public importance.

1)  Question 1 :

(1)  Whether the Court has jurisdiction to grant or uphold a winding‑up order in circumstances where it is not disputed or indisputable that the petitioner, having assigned the debt to a third party, has ceased to be a creditor of the company for the purpose of sections 177(1)(d) and 178 of the Companies (Winding Up and Miscellaneous Provisions) Ordinance (Cap. 32) (‘CWUMPO’) (even though the company did not challenge the locus standi of the petitioner at the time when the winding‑up proceedings were commenced and/or when the winding‑up order was made)?

(2)  In any event, when it becomes aware that that the petitioner has ceased to be a creditor of the company, whether the Court should proceed to investigate the question of whether the petitioner has the requisite locus standi to commence or maintain the winding‑up proceedings, regardless of whether an application by the company for leave to adduce fresh evidence should be allowed (since locus standi is a question that goes to the jurisdiction of the Court under section 177(1)(d) of CWUMPO, or at least gives rise to bona fide dispute)?

2)  Question 2 :

5.  In view of the approach expounded in Anan Group (Singapore) Pte Ltd v VTB Bank [2019] SGCA 41 (especially [34], [35], [46] and [55]‑[59]), whether the requirements laid down in Ladd v Marshall [1954] 1 WLR 1489 (‘Ladd v Marshall Requirements’) should be relaxed by the Hong Kong courts in the context of winding‑up proceedings; and if so, how and to what extent?

3)  Question 3 :

6.  Regardless of the answer to Questions 1 and/or 2 above and in any event :

(1)  Whether undisputed or indisputable evidence showing that the petitioner has ceased to be a creditor and thus has no locus standi to commence or maintain any winding‑up proceedings should be admitted even if the Ladd v Marshall Requirements cannot be satisfied, since a refusal to admit such evidence (which goes to the Court’s very jurisdiction to make a winding‑up order) :

i)  would affront common sense or a sense of justice (see, e.g.: Mulholland v Mitchell [1971] AC 666, at 680A; and Solicitor (529/2018) v Law Society of Hong Kong (No. 2) [2021] 5 HKLRD 445, at [19]‑[21] and [24])? and/or

ii)  would be inconsistent with the underlying objectives set out in Order 1A of the Rules of the High Court (Cap. 4A) (see, e.g. : Evans v Tiger Investments Ltd [2002] 2 BCLC 185, at [23] and [44])?

(2)  Whether the Court should decline to grant or uphold a winding‑up order on the ground that it would be contrary to the public policy of Hong Kong in circumstances where :

i)  since the relevant debt is based on a consent judgment entered into by a foreign court, the granting or upholding of a winding‑up order on the basis of such a debt would be tantamount to recognizing and/or enforcing the foreign judgment; and

ii)  on the petitioner’s own case: a) it does not deny that the petitioner has assigned the debt to a third party (even though the company did not raise objection at the time of the consent judgment); and b) the petitioner chose not to give notice of assignment to the company (Judgment [8])?

(3) In considering the second limb of the Ladd v Marshall Requirements (i.e. the evidence, if believed, would or might have an important influence on the result of the case, though it need not be decisive), is the Court entitled to take into account matters extrinsic to the evidence sought to be adduced (especially when the same is not in dispute) (cf: Judgment [21])?

7.  The Company further relies on the ‘or otherwise limb’ as follows :

8.  Further or alternatively, Questions 1 to 3 as set out above (whether considered individually or collectively) ought to be submitted to the Court of Final Appeal for determination under the ‘or otherwise’ limb under section 22(1)(b) of the HKCFAO bearing in mind, among others :

(1)  It is not and cannot be disputed that: i) the Petitioner had assigned the debt to an unidentified third party prior to the winding‑up order, ii) the Petitioner had chosen not to give notice of the Assignment to the Company before the order was made, and iii) the Judge below did not consider the effect of the Assignment (i.e. lack of locus standi on the part of the Petitioner) before granting the winding‑up order.

(2)  In these exceptional circumstances, grave injustice arose when the Court of Appeal refused to admit the fresh evidence regarding the Assignment, and consequently failed to consider or find that : i) the Petitioner has no locus standi to see a winding‑up order; and/or ii) there were bona fide disputes as to the petitioning debt.

III.  Our view

9.  We will not grant leave for the three questions. As admitted by Mr Yuen SC and Kok for the Company, the three questions are new grounds not previously canvassed at all before us. This is a complete reversal of the stand of the Company before us that its appeal would have no proper basis to stand on if we rejected its application to adduce new evidence. We had refused that application and the appeal was dismissed. There is no issue that the concession was not properly made by counsel who then represented the Company. With respect to counsel, the Company’s application that advances these three questions verges on being an abuse of process. It ignores its previous concession that now renders the three questions academic. It offends the Flywin principle recently reaffirmed by the Court of Final Appeal in Secretary for Justice v Timothy Wynn Owen KC (2002) 25 HKCFAR 288 at [25]‑[26]. It is a blatant ‘try‑on’ by the Company who had failed twice before two levels of court.

10.  In view of the fact that the matters raised in the three questions were not canvassed before us, we are not prepared to address them individually.

11.  As to the ‘otherwise’ ground, the practice of the Court is to defer the matter to the Court of Final Appeal for its consideration. We will only repeat what we have said earlier.

IV.  Conclusion

12.  Accordingly, the Notice of Motion is dismissed. We order the Company to pay the costs of this application to the Petitioner. Mr Li SC and Mr Chan for the Petitioner asked for an order that the funder of the application be identified and joined for the purposes of costs. As we have already given directions on this matter in the appeal itself, it is appropriate that the same directions should be granted to the Petitioner.