DINGWAY INVESTMENT LTD (In Compulsory Liquidation) v. CHINA CITY CONSTRUCTION & DEVELOPMENT CO., (HONG KONG) LTD AND OTHERS

HCA 309/2022

[2026] HKCFI 1976

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 309 OF 2022

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D E C I S I O N

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A.  INTRODUCTION

1.  This hearing concerns the matters between the Plaintiff (“P”)  and the 6^th Defendant (“D6”).  There are 6 applications before me:

(1)  D6’s summons dated 29.12.2025 (“D6’s Setting Aside Application”)  for an order to (a)  set aside the default judgment against D6 dated 04.09.2025 (“Judgment”)  and (b)  discharge the Enforcement Orders (ie the GO Nisi 1, GO Nisi 2, and the CO Nisi mentioned in subparagraphs (2)  to (4)  below);

(2)  Garnishee Order to Show Cause granted by Master SP Yip against Bank of Communications (Hong Kong)  Limited (“BOCOMM”)  dated 06.11.2025 (“GO Nisi 1”);

(3)  Garnishee Order to Show Cause granted by Master SP Yip against China International Capital Corporation Hong Kong Securities Limited (“CICC”)  dated 06.11.2025 (“GO Nisi 2”);

(4)  Charging Order: Notice to Show Cause granted by Master Dick Ho in respect of various listed securities beneficially owned by D6 held with CICC dated 20.11.2025 (“CO Nisi”);

(5)  P’s summons dated 02.12.2025 (“P’s Variation Summons”)  for an order to vary the Re-Amended Injunction Order against, inter alios, D6 granted by Cheng J as re-re-filed on 30.09.2022 and as continued by the Order of Anthony Chan J filed on 27.09.2022 (“Injunction Order”)  such that it does not prohibit BOCOMM or CICC from complying with and facilitating the execution of any garnishee or charging orders  (including any subsequent order for sale of the charged assets)  the Court may make final in relation to D6’s assets; and

(6)  D6’s summons dated 19.03.2026 (“D6’s Defence Summons”)  for leave to file an Amended Defence and Statement of Truth out of time.

2.  In this hearing, P is represented by Mr Derek JY Chan, and D6 is represented by Mr MC Law SC, leading Mr Dicky Cheung.

B.  BACKGROUND

3.  The dispute herein concerns the ultimate ownership interest in  immovable properties situated at Brickell, 1420-1438 S. Miami Avenue, Miami, Florida 33130, USA (“Miami Land”).

4.  According to P:

(1)  P is a BVI company that was incorporated on 19.12.2014 specifically to hold (indirectly)  the Miami Land.  P held 100% of the interest in Miami Land through 3 intermediate companies incorporated in Delaware, the United States.

(2)  P’s interest in the Miami Land was stripped away from it on 15.10.2019 for no consideration and without any good reason, by way of P’s 100% shareholding in CCCC Holdings LLC (“CCCC Holdings”), the Delaware company immediately below P in the structure owning the Miami Land)  (“CCCC Shares”)  being transferred to the 1^st Defendant (“D1”)  for no consideration (“CCCDHK Transfer”), which CCCC Shares D1 then purportedly sold for US$70 million to the 4^th Defendant (“D4”)  (“Rega Transfer” and “Rega Transfer Proceeds”).

(3)  In late December 2021, a sale of the Miami Land by the 5^th Defendant (“D5”, which was the titleholder of the Miami Land at the time)  to a third party was completed, for consideration of US$103 million (“2021 Sale Proceeds”).  Thereafter, the 2021 Sale Proceeds were dissipated to various parties (now named as the Defendants in this action).

(4)  In this action, P seeks to recover the economic value of the Miami Land represented by the Rega Transfer Proceeds and the 2021 Sale Proceeds and pursues causes of actions based on breach of fiduciary duty, knowing receipt, dishonest assistance, unlawful means conspiracy, and fraudulent conveyance against the various named defendants.

5.  P’s case as pleaded in the Re-Amended Statement of Claim (“RASOC”)  has been summarized (in my view, correctly)  by Mr Law SC as follows:

(1)  The Miami Land was registered under the name of D5 until around late December 2021.[1]

(2)  D5 was an indirect subsidiary of P.[2]

(3)  P advanced shareholder’s loans (“the Shareholder Loans”)  to CCCC Holdings, which in turn advanced further shareholder’s loans to CCCC USA Holdings Corp (“CCCC USA”)  and finally shareholder’s loans to D5.[3]

(4)  By a Purchase and Sale Agreement dated 04.03.2021, D5 sold the Miami Land for US$103 million (ie the 2021 Sale proceeds).[4]

(5)  Out of the US$103 million, D5 transferred to D6 approximately US$45 million (“the US$45 million”)  on or around 30.12.2021.[5]

(6)  P’s case is that it is beneficially entitled to the US$103 million.  It has a proprietary claim to all payments made to the alleged nominees out of the 2021 Sale Proceeds; and that D6 is liable to P for knowing receipt for the sum of US$45 million.[6]

(7)  Further, P claims against D6 and other defendants for damages for conspiracy to injure.[7]

6.  D6 filed a Defence on 23.12.2022 and an Amended Defence on 06.08.2024.  On 28.02.2025, Master SP Yip struck out these pleadings on the ground that these pleadings are not verified by a Statement of Truth.

7.  On 04.09.2025, based upon the matters pleaded in the RASOC, P sought a default judgment against D6.  In P’s skeleton submissions placed before the Court in that hearing, P submitted:

“29. At this juncture, P only seeks default judgment against D6 in respect of [the claims set out in [28] of the same skeleton], namely (1)  knowing receipt of US$45,076,164.38 out of the 2021 Sale Proceeds and (2)  damages for conspiracy in an amount to be assessed at trial, with the remaining claims stood over until the trial of this action.”

8.  In the hearing on 04.09.2025, I allowed P’s application for a default judgment against D6 and granted the Judgment to P.  The terms of the Judgment concerning D6 are as follows:

“1. [D6] do pay [P] the sum of US$45,076,164.38 (or the equivalent sum in Hong Kong dollars)  with interest at judgment rate until full payment;

2.  [D6] do pay [P] damages for unlawful means conspiracy in an amount to be assessed;

……

5.  The costs of these proceedings be paid by [D6] … to [P], to be taxed if not agreed.”

9.  Based upon the Judgment, P obtained GO Nisi 1, GO Nisi 2 and CO Nisi.  P further took out P’s Variation Summons for the purpose of enforcing the orders obtained against D6.

10.  D6 took out D6’s Defence Summons to seek leave to put in an Amended Defence, in the event that D6’s Setting Aside Application is successful.

11.  Before this hearing, on 18.03.2026, D6’s solicitors wrote to P’s solicitors and said:

“Having reviewed [the RASOC] further, it is clear that [P]’s case (upon which [the Judgment] was obtained)  is materially deficient and falls far short of the threshold required to justify [the Judgment]. It is impossible to see how [P] is entitled to knowing receipt of the US$45,076,164.38 or damages for conspiracy as alleged, when [P] has no beneficial interest in either the Miami Land or the 2021 Sale Proceeds.

In the interest of saving the Court’s time and the parties’ costs, we invite [P] to consent to the setting aside of [the Judgment]; and the filing of the Amended Defence and Statement of Truth out of time within 7 days from the date of the consent order to be made, with costs in the cause.

Unless we receive your client’s written consent by 5:00 pm on 19 March 2026, we shall have no alternative but to proceed with the hearing. In that event, we will seek costs against [P], especially the costs of the hearing.” (Emphasis in original)

12.  P has not given a reply to the aforesaid proposal.

C.  SETTING ASIDE APPLICATION

13.  There is no dispute that the Judgment is a regular default judgment.

14.  Mr MC Law SC on behalf of D6 is relying upon one single point in support of D6’s Setting Aside Application, ie the matters pleaded in the RASOC do not support the Judgment.

15.  It is trite that a default judgment would only be given on the basis of the plaintiff’s pleaded case alone.  The Court would not receive evidence in an application for a default judgment.  The facts pleaded in the statement of claim are deemed to be admitted.  The Court would only consider whether the statement of claim shows a right to the relief claimed.

16.  In Fok Hing (HK)  Trading Ltd v Gunawan-Indra t/a Bumipala Dhanadwipa[8], Kwan JA (as she then was)  said:

“22.  Where judgment is sought to be entered in default of defence, the court gives judgment according to the pleading alone.  It does not receive evidence in support of the plaintiff’s case.  The only enquiry it makes is whether the statement of claim shows a right to the relief claimed (Hong Kong Civil Procedure 2014, vol 1, §19/7/11).  Further, under Order 19 rule 9, a judgment in default of defence may be set aside on such terms as the court thinks just.  It is not therefore “a judgment or order determining in a summary way the substantive rights of a party to an action” within Order 59 rule 21(1)(a).

23.  In contrast, where an application is made to set aside a default judgment, the court may enquire into the merits of the case. And where the court makes an order refusing the application to set aside the default judgment, it is provided in Order 59 rule 21(2)(h)  that such an order is “a judgment or order determining in a summary way the substantive rights of a party to an action”. (Emphasis added)

17.  Mr Law SC submits that based upon the matters pleaded in the RASOC, P could not establish (a)  knowing receipt, and (b)  a conspiracy claim against D6.  Accordingly, P is not entitled to have the Judgment in the first place, and the Judgment must be set aside.

C1. Knowing receipt

18.  Whether §1 of the Judgment shall stand depends upon whether D6 may successfully challenge P’s claim against D6 based upon knowing receipt.

19.  Mr Law SC submits that P did not have any proprietary interest in the Miami Land, and P could not have any proprietary interest in the 2021 Sale Proceeds.  Accordingly, it would not be possible for P to have a claim against D6 based upon knowing receipt.

(1)  The Miami Land and the 2021 Sale Proceeds belong to D5.  P has no beneficial interest in the 2021 Sale Proceeds.  This is so held in previous decisions in this case.[9]

(2)  P is not entitled to any knowing receipt, when there is no question of any beneficial receipt of the 2021 Sale Proceeds by D6.

20.  In order to establish knowing receipt against D6, P would need to show the following:[10]

(1)  a disposal of P’s assets in breach of trust or fiduciary duty;

(2)  the beneficial receipt by D6 of P’s assets or their traceable products; and

(3)  receipt by D6 of the assets with knowledge that the assets are trust property or property subject to a fiduciary duty and have been transferred in breach of trust or fiduciary duty.

21.  Mr Law SC submits that the 2021 Sale Proceeds have never been P’s assets.  Accordingly, P’s claim based upon knowing receipt against D6 must fail.

(1)  P’s plea that it is a beneficial owner of the 2021 Sales Proceeds[11] is untenable as matter of law.  In Luo Xing Juan v Estate of Hui Shui[12], the Court of Final Appeal has clearly stated that “a shareholder has no legal or equitable interest in the company’s property (as opposed to a right to share in the profits of its business and to a distribution of any surplus on liquidation)”, and this is a “basic proposition”.  In view of this basic proposition laid down by the Court of Final Appeal, it would not be possible for P to say that it is a beneficial owner of the 2021 Sale Proceeds.

(2)  Further, the monies provided by P were loans.  In the circumstances, it would not be possible to say that somehow D5 was holding the Miami Land (or the 2021 Sale Proceeds on trust for P)  in any event.

22.  Mr Law SC submits that the problems in P’s case cannot be rectified by RASOC §36A and P’s reliance on Popplewell J’s judgment in ORB v Ruhan[13].

23.  In RASOC §36A, it is pleaded that D6 received the US$45 million “as nominee for D1 and/or for the benefit of D1”.  RASOC §36 is as follows:

“36A.  [D6], [D7], [D8], [D9] and [D10] (together, “the Nominees”)  received the 2021 Sale Proceeds as nominees for CCCDHK (D1)  and/or for the benefit of CCCDHK (D1).  Paragraphs 25 to 27 above are repeated.  The payments of the 2021 Sale Proceeds to said Nominees are not properly explained by any bona fide commercial transaction.  Rather, they are properly characterised as a distribution by Titleholder (D5)  to its immediate parent and then as distributions all the way up the corporate structure to Rega Centre (D4)  as ultimate legal owner of [the CCCC Shares] and finally to CCCDHK (D1)  as the purported beneficial owner of [the CCCC Shares]. In the alternative, they are properly characterised as a repayment by [D5] of the [D5’s Debt] to CCCC USA, then a repayment by CCCC USA of its debt to CCCC Holdings, and thereafter as a distribution by CCCC Holdings to Rega Centre (D4)  and a distribution by Rega Centre (D4)  to its purported beneficial owner.  As such, the payments of the 2021 Sale Proceeds as above pleaded represent the traceable proceeds of property in which [P] has a proprietary interest, namely the rights attached to [the CCCC Shares] which CCCDHK (D1)  caused and/or procured and/or permitted to be transferred away to its Nominees in breach of its duties in respect of [the CCCC Shares].  [P] accordingly has personal claims against CCCDHK (D1)  and the Nominees for the receipt of trust property for no consideration.  Further or alternatively, [P] has a claim against each of these Defendants for the knowing receipt of trust property in circumstances where said Defendants and each of them knew or ought to have known that neither they nor CCCDHK (D1)  had no legal or other entitlement to the 2021 Sale Proceeds.” (Emphasis added)

24.  The passages relied upon by D6 in ORB are as follows:

“114. Mr Drake submits that the effect of the transfer can have been to confer, at most, no more than an equitable proprietary interest in the shares in the six holding companies, those being the shares which were transferred by the trustee to SMA in the Isle of Man Settlement. That does not equate to any proprietary interest in the assets held by the indirect subsidiaries, which would involve ignoring their separate corporate personality. A proprietary interest in the shares of a company is not a proprietary interest in the assets of a company. Accordingly, he submits, the transfer of the proceeds of sale of the shares in GMSL, which were an asset of its immediate parent company Bridgehouse Marine Ltd, are not assets to which Mr Ruhan ever had an arguable proprietary claim.

115. Mr Waller retorts that the payments of such proceeds to Dr Cochrane are not explained by any loan or other commercial transaction; they are simply distributions to the ultimate beneficial owner (Dr Cochrane)  of the ultimate parent company (SMA); the only legal analysis which can explain each payment, he submits, is that it is to be characterised as a dividend by Bridgehouse Marine Ltd to its parent, and then a dividend by each company in the structure to its respective parent all the way up, ultimately from Ballaugh to SMA. Its receipt by Dr Cochrane is therefore to be treated as a dividend by Ballaugh to its shareholder SMA. As such it represents the traceable proceeds of the property in which Mr Ruhan has an arguable proprietary interest, namely the shareholding in Ballaugh. I am satisfied that there is a good arguable case that this is the right analysis, such that Mr Ruhan has an arguable proprietary claim to the £37,280,281 and £1 million representing the proceeds of the sale of GMSL received into Dr Cochrane's Coutts account on 23 September 2014 and 21 October 2014. No alternative legal analysis was suggested by Mr Drake.

116. The same analysis applies to the £3m representing the net proceeds of sale of Bridgehouse (Cannizaro House)  Limited, which owned the Cannizaro House Hotel, which was paid into Dr Cochrane's Coutts account on 5 November 2014. There is no commercial explanation for the payment by the vendor to Dr Cochrane. There is a good arguable case that the payment is to be treated as a dividend to its shareholder, and from it up the chain of wholly owned subsidiaries in the corporate structure until it represents a dividend by Sulby to SMA, and so the traceable proceeds of Mr Ruhan's arguable proprietary interest in the Sulby shares.” (Emphasis by D6)

25.  Mr Law SC submits that:

(1)  The facts in ORB are completely different from facts in this case.  In ORB, the asset in question was characterized as “dividend” distributed up the chain to its ultimate shareholder.  On this basis, one can easily understand why the “dividend” would be regarded as the asset of the shareholder, as opposed to assets of the company.  However, in this case, in RASOC §36A, there is no plea as to what is the nature of the alleged “distribution”.  Further, the plea of “distribution to its immediate parent company” has nothing to do with D6, when D6 is not even the immediate parent company of D5.  D5’s shareholder is CCCC USA.[14]

(2)  RASOC §36A could not assist P at all, when the fact remains that the immediate parent company granted loans to D5; and the claim of P is for knowing receipt of the 2021 Sale Proceeds, as opposed to any dividends.

(3)  Further, in order to establish its claim on knowing receipt against D6, P must show that D6 has received the US$45 million or its traceable proceeds for its own benefit, not merely as an agent or nominee.  This is not a technical or fanciful requirement.  It is essential if receipt-based liability is to be properly confined to those cases where the receipt is relevant to the loss.[15] However, P’s pleaded case is that D6’s receipt of the monies is “as nominee for [D1] and/or for the benefit of [D1]”.[16]  P’s case on knowing receipt against D6 in fact is defeated by its own pleading.

26.  Mr Derek JY Chan on behalf of P submits that RASOC §36 has given a proper basis to P’s claim against D6 based upon knowing receipt.

(1)  Mr Chan accepts that the US$45m was a payment directly paid by D5 to D6. However, Mr Chan submits that:

(a)  D6 was the nominee of D1, and hence receipt of the payment by D6 would be regarded as receipt of the same payment by D1.

(b)  D5 was an indirect subsidiary of D1 at the time of the payment.  Hence, the payment could not characterized as a dividend by D5 to its immediate parent, and then a dividend by each company in the corporate structure to its respective parent all the way up, and finally to D1.

(c)  By looking at the matters in this way, the ORB case is applicable.  By applying the ORB case, P should be regarded as having a proprietary interest in the US$45m.

27.  I am of the following view:

(1)  I agree with Mr Law SC that P has no proprietary interest in the Miami Land, and P has no proprietary interest in the 2021 Sale Proceeds.  That being the case, it would not be possible for P to put forward a claim against D6 based upon knowing receipt.

(2)  There would only be a dividend from a company if (a)  the company has made a profit, and (b)  the company has declared dividends.  It is not known whether D5 had any surplus at the time of making the payment of the US$45m to D6.  With this unknown, conceptually it would be difficult to characterize the payment of the US$45m as a distribution of dividend.

(3)  The payment was made by D5 directly to D6.  At the time of the payment, D6 was not a member in the corporate structure which included D5.

(4)  In order to bring P’s case within the ambit of the ORB case, Mr Chan has tried to bring in the point that at the time of the payment, D6 was D1’s nominee, and hence D6 received the money on behalf of D1.  As submitted by Mr Law SC, this nominee point is in direct contradiction with the “beneficial receipt” requirement in knowing receipt.

(5)  P’s argument based upon the ORB case is problematic and is not accepted.

(6)  In any event, in view of the “basic proposition” laid down by the Court of Final Appeal in Luo Sing Juan (see §21(1)  above, which is binding upon me), insofar as may be necessary, I would follow the Court of Final Appeal’s decision and decline to follow the ORB case.

(7)  In my view, it is not arguable that P would have proprietary interest in the 2021 Sale Proceeds or any part thereof.

(8)  For this reason, P’s claim based upon knowing receipt must fail.

28.  In this hearing, Mr Chan has shifted his position and tried to uphold the judgment on the US$45m by relying upon a cause of action which was not relied upon by P in the hearing on 04.09.2025, ie proprietary claim in equity.  Mr Chan submits that D6 being D1’s nominee would not defeat P’s proprietary claim in equity.  The principles concerning a proprietary claim in equity has been set out by Eugene Fung J in Welly Grace Ltd v Keung Yee Man[17]. In that case, the learned judge said:

“24. A proprietary claim in equity may be described as a claim brought by a plaintiff to recover an asset to which he has a continuing proprietary interest, or the asset’s traceable substitute. The plaintiff must prove that the property to which he lays claim is still in the ownership of the defendant if he is to obtain a proprietary remedy. The claim is brought to vindicate the plaintiff’s proprietary right in the asset and is not dependent on any discretion vested in the court. See Boscawen v Bajwa [1996] Ch 328 at 334E, 334H (Millett LJ); Foskett v McKeown [2001] 1 AC 102 at 115G (Lord Hoffmann); 129D-E, 132A-B, 142D (Lord Millett); 108F-G, 109B-D (Lord Browne-Wilkinson).”

29.  In my judgment, even putting aside the nominee point, for the reasons set out in §27(1)  to (3)  and §27(6)   above, P could not have any proprietary interest in the 2021 Sale Proceeds in any way.  P’s proprietary claim in equity against D6 for the US$45m is bound to fail.

30.  Mr Chan submits that there is an alternative basis pleaded in RASOC §36A.  In that alternative scenario, it is pleaded that D6 received the US$45m in its own rights.  With respect, given my conclusion that P has no proprietary interest in the 2021 Sale Proceedings, this alternative scenario would not take P’s case any further.

31.  For the reasons above, I am of the view that P has not pleaded a prima facie case in support of the judgment on the US$45m.  While there is no prima facie case in support of the claim for the US$45m, there is no basis upon which this Court may exercise the discretion to uphold §1 of the Judgment.  Accordingly, §1 of the Judgment must be set aside.

C2. Conspiracy claim against D6

32.  The conspiracy claim against D6 concerns §2 of the Judgment.

33.  As a matter of law, a plea for conspiracy must contain the following elements[18]:

(1)  The agreement between two or more persons.  The means of carrying out the agreement, whether lawful or unlawful, must be set out.

(2)  The intention to injure the plaintiff, whether predominant (in the case of a lawful means conspiracy)  or merely an intention to injure (in the case of an unlawful means conspiracy).

(3)  The acts that were carried out pursuant to the agreement and the stated intention.

(4)  The damage caused to the plaintiff.

34.  Mr Law SC submits that the only loss pleaded by P is the loss of the 2021 Sale Proceeds, see RASOC §38A.  He submits that the claim for conspiracy is doomed to failure for the following reasons:

(1)  It is trite that a plaintiff cannot mount a claim for the economic tort of conspiracy, if one cannot plead and prove damage caused to the plaintiff.  Here, P has no proprietary interest in the 2021 Sale Proceeds.  Thus, it is impossible to see how P could suffer any loss.

(2)  Any right infringed (ie the 2021 Sale Proceeds)  belongs to D5, rather than P.  It is trite that “a parent company cannot sue to enforce rights which belong to its subsidiary”[19].

35.  Mr Chan refutes the challenge by the following submissions:

(1)  It has never been a requirement for a conspiracy claim (which sounds in damages)  that the claimant has a proprietary interest in a relevant asset.

(2)  The argument that any loss suffered by P is barred by the principle against reflective loss is untenable.  Such an argument has been rejected by Anthony Chan J (as he then was)  in a decision dated 29 July 2022 given in this case (“the July 2022 Decision”)[20]. In that decision, the learned judge accepted D6’s submission that the loss suffered by D6 is the loss of the CCCC Shares as a result of the CCCDHK Transfer and the Rega Transfer.  The learned judge held that the no reflective loss principle does not apply to a claim made by a party who was an ex-shareholder in the company at the time of the claim.

36.  In the RASOC, it is pleaded:

“38. …… it is averred that by reason of the aforesaid … it is to be inferred that the Defendants wrongfully and with intent to injure [P] by unlawful means conspired and combined together to defraud [P] by depriving [P] of the [CCCC Shares] and their value (being the value of the Miami Land)  and the repayment of [the Shareholder’s Loans]. ……

38A. By reason of the wrongful acts of the Defendants, as set out above, [P] has suffered loss and damage. The measure of [P]’s loss is at least an amount equivalent to the 2021 Sale Proceeds.”

37.  I am of the following view:

(1)  I agree with Mr Chan that in the conspiracy claim, all that P needs to show is damage suffered as a result of the conspiracy.  The fact that P has no proprietary interest in the 2021 Sale Proceeds does not mean that P would not suffer any damage as a result of the conspiracy.

(2)  Having considered the RASOC carefully, I am of the view that P has pleaded that the loss of the CCCC Shares and their value, and the loss of the repayment of the Shareholder’s Loans, are the damage suffered by P as a result of the conspiracy.

(3)  As to D6’s reliance on the no reflective loss principle, I agree with the analysis given by Anthony Chan J (as he then was)  in the July 2022 Decision.  For the same reasons given by the learned judge, I am of the view that P’s claim for the loss of the CCCC Shares would not be barred by the no reflective loss principle.

(4)  In my view, based upon the matters in the RASOC, P is entitled to have judgment on liability on conspiracy against D6.

(5)  Accordingly, §2 of the Judgment should stand.

C3. Conclusion on D6’s Setting Aside Application

38.  My conclusion on D6’s Setting Aside Application is as follows:

(1)  §1 of the Judgment be set aside;

(2)  §2 of the Judgment stands; and

(3)  §5 of the Judgment be varied so that only costs of P’s claim against D6 based upon conspiracy are paid by D6 to P, to be taxed if not agreed.

An order to that effect would be made at the end of this decision. 

D.  P’s APPLICATIONS[21]

39.  Mr Chan has fairly accepted that if §1 of the Judgment is set aside, P’s applications in relation to GO Nisi 1, GO Nisi 2 and CO Nisi would be dismissed, and P’s Variation Summons would also be dismissed.  Given my conclusion as set out in the above, I would dismiss these applications.

E.  D6’s DEFENCE SUMMONS

40.  As a result of my ruling on P’s claim based upon knowing receipt pleaded in the RASOC, the RASOC must be further amended.  At the very least, the knowing receipt claim which has been ruled as unarguable must be removed from the pleading.  I would allow P to have some time to consider how to amend the RASOC.  In my view, it would make more sense to consider D6’s Defence Summons after knowing how P would amend the RASOC.

41.  I would give the following directions:

(1)  Any application for leave to amend the RASOC as a result of this decision shall be taken out by P within 28 days;

(2)  D6’s Defence Summons be adjourned to a hearing before a judge in chambers (open to public)  for further consideration on a date to be fixed in consultation with counsel’s diaries, with 30 minutes reserved;

(3)  P’s application taken out pursuant to subparagraph (1)  above be heard together with D6’s Defence Summons in the aforesaid hearing.

F.  COSTS

42.  Regarding costs of D6’s Setting Aside Application:

(1)  The costs of setting aside a regular default judgment would usually be awarded to the plaintiff in any event[22].

(2)  Mr Law SC submits that D6 is responsible for the costs of and occasioned by D6’s Setting Aside Application up to 18.03.2026.  Naturally, Mr Chan does not dispute this.

(3)  As to the costs after 18.03.2026:

(a)  Mr Chan submits that those costs should also be borne by D6, given that the Judgment is a regular judgment and the litigation conduct of D6 in this case[23].

(b)  Mr Law SC submits that D6 has warned P the deficiencies in P’s case on 18.03.2026, and there is no reason why D6’s success in this hearing should not be reflected in the costs order.

(c)  I am in respectful agreement with Mr Law SC.  D6 has made clear its stance in the letter dated 18.03.2026.  P has adopted the position that there is no substance in that letter.  After full arguments, it is held that D6’s challenge against the knowing receipt claim is made out.  I am of the view that as to the costs after 18.03.2026, the costs order should reflect D6’s success in that challenge.

(d)  As said in the above, there is no prima facie case based upon knowing receipt against D6 in the RASOC.  That would mean that P should not put forward the knowing receipt claim against D6 in the first place.  Further, D6 has warned P the deficiency in the knowing receipt claim on 18.03.2026.  In these circumstances, even if there is any unsatisfactory aspect in D6’s litigation conduct in this case previously, that would not be sufficient for depriving D6’s entitlement to costs after 18.03.2026 as a result of the successful challenge to the knowing receipt claim.  For these reasons, I would also depart from the usual practice and award part of the costs after 18.03.2026 to D6 to reflect D6’s success in challenging the knowing receipt claim.

(e)  P’s success in resisting D6’s challenge against the conspiracy claim should also be taken into account.

(f)  Most of the time after 18.03.2026 was spent on P’s knowing receipt claim.

(g)  Taking all the aforesaid into account, for the costs of D6’s Setting Aside Application after 18.03.2026, I would award 75% of those costs to D6.

43.  As to the costs of P’s Applications, those costs should follow the event.  I would order that costs of those applications be paid by P to D6.

44.  As to the costs of D6’s Defence Summons, those costs be reserved.

45.  Adopting a broad-brush approach, I apportion the time spent on the applications in the hearing before me in the way as shown below:

(1)  D6’s Setting Aside Application: 90%

(2)  P’s applications: 5%

(3)  D6’s Defence Summons: 5%

46.  I would make the following costs order on nisi basis:

(1)  Costs of and occasioned by D6’s Setting Aside Application up to 18.03.2026 be paid by D6 to P forthwith;

(2)  75% of the costs of D6’s Setting Aside Application after 18.03.2026 be paid by P to D6 forthwith;

(3)  Costs of P’s Applications be paid by P to D6 forthwith;

(4)  Costs of D6’s Defence Summons be reserved.

Unless there is an application for variation of the costs order nisi made by an inter partes summons within 14 days after the handing down of this decision, the costs order nisi shall become absolute without a further order.

47.  For the costs provided in §46(1)  to (3), all those costs be summarily assessed on paper. Since each side has been awarded some costs, each side would have an opportunity to lodge (a)  a statement of costs, and (b)  a list of objections to the costs claimed by the other side.

(1)  Within 14 days after the costs order nisi becoming absolute, P and D6 do lodge and serve their respective statements of costs for summary assessment;

(2)  Within 14 days thereafter, P and D6 do lodge and serve their respective lists of objections.

G.  DISPOSITION

48.  I make the orders as set out in §§38, 39, 41, 46 and 47 above.

49.  Lastly, it remains for me to thank all counsel for the helpful assistance rendered to the Court.