北京誠義豪泰投資管理有限公司 v. ZHANG YUPING (also known as CHEUNG YU PING) AND ANOTHER

HCCT 1/2025

[2026] HKCFI 925

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTRUCTION AND ARBITRATION PROCEEDINGS NO 1 OF 2025

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D E C I S I O N

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1.  Interim-interim relief is meant to be an urgent temporary stop‑gap measure, where the circumstances are such that the court has to do practical justice on the balance of fairness even though it may not have the time to consider the matter fully. The court will take whichever course appears to carry the lower risk of injustice if it should turn out to be wrong.

2.  As regards the merits of the Plaintiff’s case for a Chabra injunction against the intended D2 Fung, any views that I form at this stage can of course only be provisional and subject to revisiting. I do however need to be satisfied that there are sufficient merits, or else any interim‑interim order risks being unjust: cf. China Shanshui Cement Group Ltd v Zhang Caikui [2018] HKCA 409 at [18]-[19].

3.  The relevant principles in relation to the grant of a Chabra injunction have been set out by the Plaintiff in paragraph 11 of its skeleton. Amongst other things, the Plaintiff points out that the jurisdiction may be exercised under two alternative limbs:

3.1  first, whether there is good reason to suppose that a defendant against whom the plaintiff asserts no cause of action (“an NCAD”) holds, is using, or has exercised, or is exercising a power of disposition over, or is otherwise in possession of, assets of the defendant whom the plaintiff asserts to be liable on his substantive claim in the arbitration; and

3.2  second, whether there is good reason to suppose that the assets held in the name of the NCAD would be amenable to execution of some process, ultimately enforceable by the courts, by which the assets would be available to satisfy an award against the cause of action defendant.

4.  In relation to the first limb, the Plaintiff says that there is good reason to suppose that Fung in fact holds the Subject Shares as a nominee for the 1st Defendant. The Plaintiff says that:

4.1  in opposing the application to stay DHCJ Andrew Li’s order of 29th May 2025 (refusing to continue the injunction against the 1st Defendant), the 1st Defendant had expressly submitted to the court that had had owned the Subject Shares for a period of time and that he continued to do so, so that it was unreal to suggest that the appeal would be rendered nugatory by the disposal of the shares. In other words, the impression given to the court was that the Subject Shares would not be disposed of and would remain available in the event of any execution;

4.2  yet within a week thereafter, the 1st Defendant transferred the Subject Shares to Fung for nil consideration. The 1st Defendant says that this was pursuant to a consent order in FCMC proceedings, but has not disclosed that order or provided information as to when the agreement was arrived at. The existence of the proceedings, the consent order (if it was made before the consideration by DHCJ Andrew Li of the interim stay application), or the possibility of such an order being made, were not disclosed to the court in connection with the Plaintiff’s application for an interim stay.

5.  The transfer was for nil consideration. Of course one possible explanation for that would be that the transfer was part of a division of matrimonial assets, but if so, it is difficult to see why details were not frankly placed before DHCJ Andrew Li in resisting the application for an interim stay (even taking into account requirements of privilege and confidentiality), and why the skeleton placed before DHCJ Andrew Li, presumably on the 1st Defendant’s instructions, sought to assure the court that there would be no transfer.

6.  It must be at least arguable that the Subject Shares are being held by Fung on behalf of the 1st Defendant, and that the transfer was to enable the 1st Defendant to put his assets out of the reach of his creditors.

7.  In relation to the second limb, the evidence is that:

7.1  the 1st Defendant has been in financial difficulties since July 2024 when his investment in the mainland was frozen;

7.2  the 1st Defendant failed to satisfy a PRC arbitration award handed down on 13th June 2025 requiring him to pay over RMB 125m.

8.  It must be at least arguable that the 1st Defendant was insolvent or rendered himself insolvent by transferring the Subject Shares to Fung on 23rd and 24th June 2025, and that in the event of the 1st Defendant’s bankruptcy, the trustee in bankruptcy may be able to set aside the transfers, thereby rendering the Subject Shares amenable to execution.

9.  Mr Harrison Miao, counsel for Fung, opposes the interim-interim injunction primarily on the grounds of delay, saying that this goes to show that (1) this is not a case which requires urgent interim-interim relief of the nature envisaged in China Shanshui Cement Group Ltd, and (2) there is no risk of dissipation of the Subject Shares. He points out that the Plaintiff knew about the transfer of the Subject Shares by 2nd July 2025, and also knew of the 1st Defendant’s explanation for the transfer in his affirmation of 21st July 2025 (namely, pursuant to an order in the FCMC proceedings), but did not take any action until its summons of Tuesday 27th January 2026. Insofar as the Plaintiff says that the justification for the urgency was the completion of the Acquisition on 3rd February 2026, pursuant to which Empire Charm Limited (“Empire Charm”) would acquire sufficient shares in Listco, pursuant to its unconditional general cash offer earlier announced, for both (1) the Zhang family to retain control of Listco and (2) Fung to nevertheless dispose of some or all the Subject Shares, the Plaintiff would have realised this possibility back in November 2025, when the offer was announced. Furthermore, since Empire Charm and the parties acting in concert with it held 61.79% of the Listco shares, Fung could all along have disposed of at least some of the Subject Shares without jeopardising the Zhang family’s control of Listco, but she did not.

10.  I accept the submissions of Mr Roger Phang (together with Mr Kelvin Tse), counsel for the Plaintiff, that the reason for not making the current application earlier can be properly explained by the fact that as the Plaintiff had no cause of action against Fung, it first had to obtain sufficient evidence to satisfy the Chabra requirements against Fung before an application could be made.

11.  In relation to the first limb of the Chabra jurisdiction, the Plaintiff only recently pieced together bits and pieces of information, as set out in the 3rd Affirmation of Law Ming Yiu Felix of 15th December 2025 (“Law 3rd”), the Affirmation of Zhang Yuping of 16th January 2025 (“Zhang 1st”) and the 3rd Affirmation of Zhang Yuping of 12th January 2026 (“Zhang 3rd”) that:

11.1  in July 2024, arbitration proceedings had been commenced against the 1st Defendant in Shanghai;

11.2  the Plaintiff’s wholly owned company Best Corporate Limited had been subject to a number of asset freezing orders in the mainland, including in July 2024 and August 2025;

11.3  in June 2025, an arbitral tribunal in Shanghai had ordered the 1st Defendant to pay a sum of over RMB 125m;

11.4  the Plaintiff had been placed in the mainland’s List of Dishonest Persons Subject to Enforcement since September 2025, because he had failed to pay the judgment debt of over RMB 125m;

11.5  enforcement action against Best Corporate Limited had been taken in the mainland and its assets, comprising its shareholding in Primetime Group Co Ltd, had been frozen by the Shanghai Financial Court in August 2025.

12.  Thus the 1st Defendant’s statement in Zhang 1st of 16th January 2025 that the FCMC proceedings had been commenced before the Plaintiff’s statutory demand and the suggestion that the FCMC proceedings could not have been for the purpose of colluding with the 1st Defendant to put his assets out of reach was negated.

13.  In relation to the second limb of the Chabra jurisdiction, the aforesaid information also shows that at the time of the transfer of the Subject Shares to Fung, the 1st Defendant may in fact have been insolvent, so that there is a prospect that if the 1st Defendant should be declared bankrupt, the transfer of the Subject Shares to Fung can be challenged.

14.  Thus the 1st Defendant’s statement in the 2nd Affirmation of Zhang Yuping (“Zhang 2nd”) of 21st July 2025 which said that Fung agreed to accept the Subject Shares in the FCMC proceedings because the procedures for transferring his other assets located in mainland China were more complex and time consuming, which suggested that the 1st Defendant had other assets and was not insolvent at the time of the transfer, was negated.

15.  I further accept Mr Phang’s submission that the urgency of seeking interim-interim relief arose because the Acquisition completed on 3rd February 2026. Mr Miao points out that this was not the focus in the Plaintiff’s affidavit evidence filed in support of the Chabra application. But Mr Phang explains that that evidence was directed towards the substantive Chabra application, whereas the current urgent need for interim-interim relief, pending the hearing of that application, stems from the fact that on 23rd January 2026, the Plaintiff learned from a public announcement that Empire Charm’s general offer would be taken up to the extent of 22.61% of the issued shares of Listco, which meant that upon completion of the Acquisition, the Zhang family would be able to retain control and a majority ownership in Listco without the need for the Subject Shares. Mr Phang further pointed out that the extent of take up of the offer was not a foregone conclusion, as the independent financial adviser in relation to the offer had advised shareholders against taking up the offer.

16.  I further accept that the necessary risk of dissipation has been shown. Whilst the principal focus of inquiry is on the conduct of the NCAD, where the CAD has substantial control over the assets in the name of the NCAD, it may be relevant to consider the CAD’s conduct as well: Company A and others v Company D and others [2019] HKCFI 367 at [83].

17.  Given the unexplained aspects of the transfer of the Subject Shares to Fung and the timing of the transfer, I accept for present purposes that it may be possible to infer that there was an arrangement between the 1st Defendant and Fung that the Subject Shares would be transferred to her with the object of putting them out of reach of enforcement.

18.  Although Fung retained the Subject Shares after the transfers in June 2025, the position has changed now in that after the Acquisition, Fung will be able to dispose of the Subject Shares without affecting the Zhang family’s control over Listco.

19.  Mr Miao submitted that had the FCMC proceedings been for the purpose of dissipation of assets, then the transfer would not have been limited to the Subject Shares. At present, there is in fact insufficient information about the proceedings to know exactly what was transferred in those proceedings. In any event, there are no other known assets of the 1st Defendant, not currently frozen, which could have been so transferred, since it now transpires that his major mainland asset has been frozen.

20.  The Plaintiff’s recent discovery of information which undermines the 1st Defendant’s statements in his earlier affirmations about his assets also supports the risk that there may be unjustified dissipation.

21.  Looking at matters in the round, it seems to me that the course of action which would give rise to the lower risk of injustice, should it turn out to be wrong, is to grant an interim-interim Chabra injunction against Fung, pending substantive resolution of the Plaintiff’s application.