YAO GUOLIANG AND ANOTHER v. FOREVER WINNER INTERNTIONAL LTD AND OTHERS

HCMP 2442/2024 &
HCMP 2297/2025
(Heard Together)

[2026] HKCFI 1146

HCMP 2442/2024

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2442 OF 2024

__________________

__________________

BETWEEN

__________________

AND

HCMP 2297/2025

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MISCELLANEOUS PROCEEDINGS NO. 2297 OF 2025

__________________

__________________

BETWEEN

________________________

(Heard Together)

________________________

D E C I S I O N

________________________

I. INTRODUCTION

1.  On 14 November 2025, in HCMP 2442/2024 (the “Underlying Proceedings”), under Order 52, I granted leave (the “Order 52 Leave”) ex parte to Yao Guoliang (“Yao”) and Jin Yao Holdings Limited (“Jin Yao”) to issue contempt proceedings against Wang Jian Sheng (“Wang”). On 24 November 2025, they filed the Originating Summons (the “Originating Summons”) in HCMP 2297/2025 (the “Contempt Proceedings”) against Wang. On 5 January 2026, Wang filed a Summons (the “Set Aside Summons”) for settling aside the Order 52 Leave. The Set Aside Summons is the Summons I am now dealing with.

II. BACKGROUND

2.  Yao (via Jin Yao) and Wang are each 50% shareholder and the only directors of Forever Winner International Limited (“Forever Winner”), a company incorporated in the British Virgin Islands (“BVI”). The main asset held by Forever Winner is its 49.06% shares (the “49.06% Stake”) in Strong Petrochemical Holdings Limited (“Listco”), a Cayman Islands company listed on the Hong Kong Stock Exchange.

3.  The relationship between Yao and Wang turned sour in late 2024.

4.  Further, on 3 October 2024, the Listco announced that Yao had been convicted of insider dealing in France. In response, on 29 October 2024, HongKong Hengyuan Investment Limited (“Hengyuan”), a third-party shareholder of the Listco, requisitioned for an extraordinary general meeting (“EGM”) proposing (the “Proposal”) to pass resolutions to remove all the directors except Yao from the board, those directors to be removed being regarded as associates of Yao. The EGM was to be held on 27 December 2024. How Forever Winner, holding 49.06% Stake, would vote on the Proposal would be decisive at the EGM. However, given the sour relationship between Yao and Wang, the only 50% shareholders and the only directors of Forever Winner, the board was deadlocked and it could not vote. Yao was purportedly removed from the board of Forever Winner.

5.  On 18 November 2024, Yao commenced BVI proceedings (the “BVI Proceedings”) to assert his directorship of Forever Winner.

6.  On 19 November 2024, in aid of the BVI Proceedings under section 21M of the High Court Ordinance (Cap. 4A), Yao and Jin Yao issued the Originating Summons in the Underlying Proceedings seeking, among others, an injunction restraining, among others, Forever Winner and Wang from voting at the EGM to remove the associates of Yao as directors of the Listco, as an interim measure. In Yao’s supporting affirmation (“Yao’s Underlying Supporting Affirmation”), he deposed, among others:-

“E. [Forever Winner’s] BANK ACCOUNT WITH UBS HK

52. [Forever Winner] maintains a bank account with the Hong Kong branch of UBS AG… (“UBS Account”). The only authorized signatory of the UBS Account is Wang.

53. A copy of a bank statement for the UBS Account dated 9 October 2020 is at pages 265 to 278 of “YGL-1”…

54. To the best of my knowledge or belief, the UBS Account should contain the following key assets of [Forever Winner]:-

(1) Share certificates for at least certain portion of the Shares [that is, 1,041,746,000 shares in the Listco], which constitute a very substantial shareholding in [the Listco]; and

(2) Substantial dividends declared or to be paid by [the Listco]…

55. As explained above, I was purportedly removed as director of [Forever Winner] without my prior knowledge or consent, and Wang must have played a key role in my purported removal.

56. As such, I fear that Wang and/or Xia [purportedly appointed to replace Yao as director] will illicitly take steps to dissipate the assets held in the UBS Account and respectfully request the Court to restrain them from doing so.” (emphasis added)

7.  On 22 November 2024, at the hearing before DHCJ R. Ismail SC, the parties agreed to dispose of the Underlying Proceedings by Consent Order (the “Consent Order”). In the Schedule to the Consent Order, the parties agreed that Yao would be reinstated as the only other director than Wang. Further, Wang gave the following undertaking (the “Undertaking”):-

“4. Within 14 days hereof, [Wang] undertakes to file an affidavit on behalf of [Wang] [and the 3^rd and 4^th defendants therein] disclosing the following matters in relation to the period from 5 October 2024 up to and including the date hereof [that is, 22 November 2024]:-

(3) Whether any of [Forever Winner’s] assets have been dealt with and if so, the particulars of such dealings.” (emphasis added)

8.  I shall refer to this period from 5 October 2024 to 22 November 2024 as the “Relevant Period”.

9.  On 16 December 2024, Wang filed an affirmation (“Wang 2^nd Affirmation”) for the Undertaking. In Wang 2^nd Affirmation , Wang deposed on oath :-

“(3) Whether any of [Forever Winner’s] assets have been dealt with and if so, the particulars of such dealings.

6. [Forever Winner’s] assets have not been dealt with by Wang [and the 3^rd and 4^th defendants therein] during the Relevant Period.”

10.  I shall refer to this content as the “Wang’s Confirmation”.

11.  On 27 December 2024, the EGM of the Listco was held. Despite the deadlock at Forever Winner (with Yao and Wang being the only equal shareholders and directors), Yao attempted to procure Forever Winner to vote against the Proposal. This led to proceedings in HCMP 66/2025 commenced by Wang and his camp against Yao and the chairperson of the EGM. The long and short is that in her Decision of 17 January 2025 ([2025] HKCFI 456) Linda Chan J ordered an EGM to be held on 25 January 2025, where the Proposal was passed.

III. ORDER 52 LEAVE

12.  By a Statement pursuant to Order 52 rule 2(2) (the “Order 52 Statement”) filed by Yao and Jin Yao on 7 November 2025, they sought Order 52 Leave to make an application for an order of committal against Wang.

13.  According to the Order 52 Statement:-

(1) On 13 June 2025, UBS Bank AG, Hong Kong Branch (“UBS”), with whom Forever Winner maintained a bank account (the “UBS Account”), provided Yao with approximately 650 pages of documents pursuant to a disclosure order granted in HCA 882/2025 on 30 May 2025;

(2) After analysing the documents, Yao discovered that on 31 October 2024, Forever Winner issued a letter of instructions to USB (the “31 October 2024 Letter”), signed by Wang “[f]or and on behalf of” Forever Winner, directing UBS to withdraw six physical share certificates corresponding to 300,000,000 shares of the Listco (the “Share Certificates”) from the UBS Account and to deliver the Share Certificates to Wang’s son (“Wang Junior”); and

(3) UBS executed the instructions accordingly. A “Confirmation of Outgoing Delivery” dated 19 November 2024 stated that six tranches of 50,000,000 shares of the Listco had been withdrawn from the UBS Account and delivered according to instructions.

14.  In the Order 52 Statement, Yao and Jin Yao accused Wang of breach of the Undertaking and making false statement on oath. For the accusation of breach of Undertaking, the particulars set out in the Order 52 Statement are reproduced here:-

“PARTICULARS OF BREACH OF UNDERTAKING

33.1… Pursuant to the Undertaking, [Wang] was required to disclose inter alia whether any of [Forever Winner’s] assets had been dealt with during the Relevant Period, and if so, the particulars of such dealings.

33.2… The issuance of the [31 October 2024 Letter], withdrawal of [the Share Certificates] from the UBS Account and/or subsequent delivery of the Share Certificates to [Wang Junior] constituted dealings with [Forever Winner’s] assets during the Relevant Period.

33.3… The aforesaid dealings with [Forever Winner’s] assets were not disclosed in [the Wang 2^nd Affirmation] (or any other affirmation filed by [Wang]) despite his knowledge of the same, as reflected in his signing of the [31 October 2024 Letter].

34. [Wang’s] breach of the Undertaking was accompanied by the state of mind necessary to establish punishable contempt…”

15.  For the accusation of making false statement on oath, the particulars set out in the Order 52 Statement are:-

“PARTICULARS OF FALSE STATEMENT ON OATH

36.1… At paragraph 6 of [the Wang 2^nd Affirmation] which was purportedly filed in compliance with the Undertaking, [Wang] provided the Confirmation to the effect that [Forever Winner’s] assets had not been dealt with during the Relevant Period.

36.2… The Confirmation was false as there had in fact been dealings with [Forever Winner’s] assets during the Relevant Period.

36.3... [Wang] made the false Confirmation knowing that it was false as he had signed the [31 October 2024 Letter].

37. [Wang]’s false statement was likely to interfere with the course of justice in some material respect. In particular (but without limitation):-

37.1… The Undertaking was given in the context of [Wang] having illicitly seized control of [Forever Winner] away from [Yao], who had previously jointly managed [Forever Winner] with [Wang] at all material times.

37.2. As such, [Yao] had legitimate concerns that during the Relevant Period, [Wang] had dealt with [Forever Winner’s] assets without [Yao’s] knowledge. These concerns were reflected in paragraph 3(3) of [the Originating Summons], by which the Plaintiff sought to restrain inter alios [Wang] from ‘dealing with the assets of [Forever Winner], including but not limited to those in its account maintained by [UBS], without the written consent of [Yao] and [Jin Yao].

37.3. The purpose of the Undertaking was to enable the Plaintiffs to ascertain whether [Wang] (and/or his associates) had dealt with the assets of [Forever Winner] during the Relevant Period. If such dealings had been disclosed, the Plaintiffs could proceed to take appropriate action in response, including but not limited to [seek] further relief from the Court.

37.4. By falsely stating in Wang 2^nd that none of [Forever Winner’s] assets had been dealt with during the Relevant Period, the Plaintiffs were not informed of the dealings with the Share Certificates on or around December 2024 (i.e. the deadline for [Wang] to comply with the Undertaking). Rather, they only discovered [this] over half a year later after analyzing the documents provided by UBS pursuant to the Disclosure Order. By this time, the Share Certificates had long fallen into the hands of [Wang Junior].

37.5. Thus, [Wang]’s false statement obstructed the Plaintiffs from taking responsive action and seeking appropriate relief from the Court in a timely manner, which amounts to interference with the course of justice in a material respect. Without any waiver of privilege, the Plaintiffs are taking legal advice as to their next steps and potential recourse in light of the late discovery.

38… In light of [Wang’s] sophistication and legal representation, he knew or ought to have known that the false Confirmation would likely interfere with the course of justice.” (emphasis added)

16.  Pausing here, I observe that §§37.3-37.5 of the Order 52 Statement gives an impression that Yao or Forever Winner had suffered prejudice as a result of the falsity of Wang’s Confirmation and that a meaningful purpose would have been served had the falsity of the Confirmation been discovered earlier, namely, Yao or Forever Winner would otherwise be taking speedy action to address the withdrawal of the Share Certificates. However, as at today, there is no evidence as to what Yao or Forever Winner has done after the discovery of the falsity of the Confirmation. On the contrary, after the commencement of the Contempt Proceedings, liquidators were appointed of Forever Winner, and therefore it would no longer be Yao’s business to go after the Share Certificates representing the shares owned by Forever Winner. I also observe that nothing was mentioned in the Order 52 Statement that the Share Certificates were not bearer share certificates; in other words, despite the withdrawal of the Share Certificates, no change of ownership occurred, and the ownership of the Shares remained with Forever Winner.

17.  Since the application for the Order 52 Leave was an ex parte application, there was a section “D. Full and Frank Disclosure” in the Order 52 Statement. It is convenient at this juncture to say that the Order 52 Statement was not settled by counsel.

18.  There were three full and frank disclosures made. In summary:-

(1) There are a number of disputes between Yao and Wang, but these disputes should have no bearing on the application for the Order 52 Leave (§44).

(2) There was substantial delay given that on 13 June 2025, USB already provided the 31 October 2024 Letter to Yao. However, the documents provided by USB ran up to 650 pages and reasonable time was required to analyse the same. Further, the disputes between Yao and Wang took up some time as well. No oppression was caused (§45).

(3) Wang had not been warned that he may have committed a contempt, and so had lost an opportunity to recant from the Confirmation. However, such a warning was not a prerequisite and Wang had been advised by experienced lawyers and thus should know that he had been in contempt (§46).

IV. APPLICATIONS BEFORE THE COURT

19.  Mr Jose Maurellet SC, leading Mr Sik Chee Ching, counsel for Wang, submits that the Set Aside Summons should be allowed for the following grounds:-

(1) “Assets” in the Undertaking do not cover the Share Certificates;

(2) In any event, the Contempt Proceedings are disproportionate and inappropriate; and

(3) There were material non-disclosures in the ex parte application for the Order 52 Leave.

20.  Ms Catrina Lam SC, leading Ms Lilian Ip[1], counsel for Yao and Jin Yao, opposes each of the above grounds.

V. MEANING OF “ASSETS” IN THE UNDERTAKING

21.  The shares (the “Shares”) represented by the Share Certificates are registered shares. They are not bearer shares, which are prohibited in the BVI. Therefore, Mr Maurellet submits that the Share Certificates are not “assets” under the Undertaking. He refers me to the well-established principles in Cheung Pui Yuen v Worldcup Investments Inc (2009) 12 HKCFAR 31 at §§13 and 28 that the rights and obligations of the owners of the shares are choses in action in the shares, but not in the share certificate representing the shares, while the share certificate is only a piece of paper evidencing the shares:-

“13. Shares in a company are legal choses in action. They are not chattels. Share certificates, the pieces of paper issued by the company which record the issue of the shares to which they relate, are, on the other hand, chattels. The rights and obligations of the owners of shares in a company, the owners of the legal choses in action that the shares constitute, depend upon the articles of association of the company and the terms on which the shares in question were issued – provided, of course, that the terms of issue were authorized by the articles. None of these principles is, I believe, contentious, but they need to be borne in mind for the judgments in the courts below, and the submissions that have been made to this Court, have proceeded on the basis that the rules of law relating to the transfer of chattels apply to the transfer of bearer shares as if bearer shares were chattels. But bearer shares are not chattels; they are legal choses in action. Share certificates are chattels but their role in relation to the shares themselves is evidential (see Longman v Bath Electric Tramways Ltd [1905] 1 Ch 646 at pp.659, 660 and 665, 666). In Longman Romer LJ said at p.665, uncontroversially I would have thought, that “… a certificate of shares is not a negotiable instrument …”. He was not speaking of bearer shares but of registered shares. Registered shares are transferable by an instrument of transfer leading to the registration of the transferee in the books of the company as the owner of the shares transferred. But why, in principle, should the analysis be different where bearer shares are concerned? In Palmer’s Company Law, Part 2 para.520) is to be found the statement that “… the situs of bearer shares is the place at which those shares are held because they are negotiable instruments which are transferred by delivery”. No authority is cited in support of the, to me, startling proposition that bearer shares (it is clear that the author means the share certificates) are negotiable instruments….

28. A transfer of the legal title to chattels requires, it is common ground, an act of, or equivalent to, delivery of the chattels to the transferee coupled with the requisite intention on the part of the transferor to transfer ownership. If the delivery were pursuant to a contract of sale, the requisite intention would usually be plain enough. If it were pursuant to an intention to make a gift, the intention would, if challenged, need to be proved. The proof might, however, given an appropriate relationship between transferor and transferee, be assisted by the evidential and rebuttable presumption of advancement. All of this is trite law and not in the least in dispute in this appeal. However, shares in a company, whether bearer shares or registered shares, are not chattels. They are legal choses-in-action. Share certificates, the pieces of paper evidencing the issue of and title to the shares, are chattels. They may be sold or pledged or made the subject of a gift as may be any other chattels. The requirements for proof of a gift of share certificates, of the pieces of paper, would, in principle, be the same as for any other chattels. But an effective gift, or sale or pledge, of the share certificates could not, in my opinion, by itself vest in the transferee the legal title to the shares themselves. The transfer would entitle the transferee, as against the transferor, to the benefit of the transaction, whatever that might be, and to retain the share certificates accordingly, but in order to perfect the legal title of the transferee to the shares notice to the company of the transfer would, in principle, be necessary. The rights of a shareholder as against the company depend upon the articles of the company but, subject to that, would be expected to include the right to notice of company meetings, the right to vote at company meetings, the right to receive a dividend if a dividend were declared, the right to participate in any capital distribution, and so on. None of these rights could be enforced by a transferee against the company unless the legal title to the shares had vested in the transferee, or, perhaps, unless an order giving effect to the rights were made in an action in which the legal owner was a party.” (emphasis added)

22.  Mr Maurellet submits that since the Share Certificates are only chattels in the above sense, the Share Certificates are effectively pieces of paper without any value. Since the Undertaking is concerned with dissipation of the assets of Forever Winner (as appears from Yao’s Underlying Supporting Affirmation: see §6 above), on a proper objective construction of the Undertaking, whether textually, contextually and/or purposively, “assets” is not intended to cover the Share Certificates. He further submits that if there is any ambiguity in the meaning of “assets” in the Undertaking, it should be strictly construed in favour of Wang: see Essilor Manufacturing (Thailand) Co., Ltd v Wong Kam Wai and others [2020] HKCA 351 at §25 per Poon CJHC and Lam VP.

23.  Ms Lam relies also on Cheung Pui Yuen v Worldcup Investments Inc with a different emphasis. She emphasises that the Share Certificates are chattels, and as chattels, they are property and thus assets. Further, she emphasises that the Share Certificates are not pieces of paper without value as Mr Maurellet submits. She highlights that according to the passages Cheung Pui Yuen v Worldcup Investments Inc cited above, share certificates could be pledged, and since at the material times, Wang was in control of Forever Winner, Wang would be able to pledge the Share Certificates representing to the third parties that he pledged on behalf of Forever Winner. Therefore, she submits, when Yao expressed his concern that Forever Winner’s assets would be dissipated in 56 of Yao’s Underlying Supporting Affirmation, he, as well as Wang (represented by experienced senior counsel) must have well known that “assets” was intended to cover the Share Certificates. Ms Lam also stresses §54 of Yao’s Underlying Supporting Affirmation clearly intended to include “Share Certificates” into assets. It is worth quoting that paragraph here again:-

54. To the best of my knowledge or belief, the UBS Account should contain the following key assets of [Forever Winner]:-

(1) Share certificates for at least certain portion of the Shares [that is, 1,041,746,000 shares in the Listco], which constitute a very substantial shareholding in [the Listco]; and

(2) Substantial dividends declared or to be paid by [the Listco]…

56. As such, I fear that Wang and/or Xia [purportedly appointed to replace Yao as director] will illicitly take steps to dissipate the assets held in the UBS Account and respectfully request the Court to restrain them from doing so.” (emphasis added)

24.  With respect, for the following reasons, I disagree with Ms Lam:-

(1) While in theory, the Share Certificates, being chattels, could be pledged, in my view, practically, no one would really be willing merely to accept the Share Certificates in themselves without the Shares as a pledge. The mere Share Certificates in themselves would have no value or no security to the pledgee at all, because whether as a matter of law or the articles of association of the Listco, what would matter would be who were the registered member of the shares on the Register of Members and the rights on the Shares, rather than the mere Share Certificates which would not entitle the holder of the Share Certificates (as opposed to the Shares) to exercise any rights on the Shares. If the pledgee would in no way be able to lay his hands on the Shares (as opposed to Share Certificates) and the rights on the Shares, then no pledgee would accept pledging of the mere Share Certificates (as opposed to the Shares). Thus, in the normal course of event, pledging the Shares would require not only the physical Share Certificates but also signed instruments of transfers in respect of the Shares (as opposed to the Share Certificates) for the pledgee to keep in escrow. If there were really such pledging of the Shares (as opposed to the mere Share Certificates), then there would be dealing of assets caught by the Undertaking. So understood, there would be nothing wrongful about the mere movement of the mere Share Certificates. This points towards the parties’ objective understanding that the mere movement of the mere Share Certificates, without more, would not be regarded as “dealing with assets”, and that the Court would not be concerned with any “dealing with assets” that would practically have no or de minimis consequence.

(2) Further, when reading §54 of Yao’s Underlying Supporting Affirmation in context (notably, with §56), it is clear that Yao was concerned that Forever Winner’s assets had been dissipated. When he used “a very substantial shareholding” to describe the asset in question, objectively speaking, he must be referring to the Shares, rather than the mere Share Certificates, because the Share Certificates in themselves would have no value and confer no rights. Take pledging again as the example. If there were really pledging of the Shares (as opposed to the mere Share Certificates), such pledging would be a real concern Yao had. But if somehow, there would really be a pledging of the mere Share Certificates in themselves (without pledging any Shares), Forever Winner would be entitled to be issued new Share Certificates under articles 18 and 21 of the articles of association of the Listco subject to a fee. Although it may be said that Forever Winner would suffer a loss in the sense that it would have to pay a fee for the issuance of the new Share Certificates, such loss clearly was not a concern Yao had in respect of dissipation of assets, when Yao was concerned with the “very substantial shareholding” rather than the mere Share Certificates or any dealing that would practically have no or de minimis consequence.

(3) The above provide the context and purpose against which “assets” in the Undertaking is to be construed. Textually, “assets” is not a term clearly to include or exclude mere share certificates. However, against such context and purpose, I take the view that it is clear that “assets” does not include mere share certificates.

(4) Further and in any event, if there is still any ambiguity in “assets” despite the context and purpose mentioned above, the ambiguity should be construed in favour of Wang, and therefore, “assets” should be construed not to cover mere share certificates.

25.  Ms Lam also submits that there is evidence that Wang himself thinks that the mere Share Certificates falls within “assets”. She points out that in the BVI Proceedings, when confronted that he had moved away the Share Certificates from the UBS Account, his reaction in the affirmation was not that the Share Certificates were not assets, but that he denied having moved the Share Certificates. She also points out that in the 1^st affirmation filed on 5 January 2026 (the “Wang 1^st Affirmation”) in the present proceedings, Wang explained that the reason for the movement of the Share Certificates was that he would like to “keep an eye over them” and “safekeep them” (see §29 of the Wang 1^st Affirmation), and that there was an understanding between Wang and Yao on the arrangement of the control of the share certificates of the shares held by Forever Winner in the Listco (see §32 of the Wang 1^st Affirmation). Ms Lam asked rhetorically, if the Share Certificates are of no significance to Wang and Yao, why would Wang have to keep an eye and why would they have to reach any understanding on the arrangement on the share certificates?

26.  There is force in Ms Lam’s submissions. However, to construe a Court Order and an undertaking, the standard is objective. Therefore, what Wang subjectively thought and thinks is irrelevant. Further and in any event, as explained above, the Share Certificates would be of any significance in certain circumstances, namely when the Shares represented by the Share Certificates are pledged by using the Share Certificates coupled with, for example, signed instruments of transfer. Therefore, it would not be surprising that Wang and Yao still like to keep an eye on the Share Certificates, and/or were concerned about the arrangement of the Share Certificates. However, it does not follow that they would think that the mere Share Certificates would be “assets” and the mere movement of the mere Share Certificates would be “dealing with assets” in the Undertaking, which is already wide enough to cover pledging of the Shares with the Share Certificates being the parties (or Yao’s) real concern.

27.  Having considered the above, I take the view that “assets” does not cover the mere Share Certificates and “dealing with assets” in the Undertaking does not cover the mere movement of the mere Share Certificates, without more. Therefore, the Undertaking does not cover Wang’s movement of the Share Certificates away from the UBS Account, and therefore, in deposing in the Wang’s Confirmation that he did not deal with the assets in the UBS Account, he did not breach the Undertaking and did not make any false statement.

28.  This is sufficient for me to set aside the Order 52 Leave and dismiss the Contempt Proceedings. For the sake of completeness, I shall say something about proportionality and full and frank disclosure on which parties also made elaborate submissions.

VI. PROPORTIONALITY

29.  In respect of proportionality, the following well-established principles are pertinent here:-

(1) “Where the alleged contempt is merely technical or not particularly serious, the court may refuse leave”: see Hong Kong Civil Procedure 2026 Volume 1 §52/2/12.

(2) “Wherever there is a reasonable alternative to committal proceedings available in aid of execution of a civil process, that alternative should be taken… Committal orders are remedies of last resort…”: see Hong Kong Civil Procedure 2026 Volume 1 §52/1/8.

(3) While a court order must be obeyed, it does not follow that failure to do to would invariably justify pursuit of committal proceedings: see Re ZPMC-Red Box Energy Services Limited [2021] HKCFI 2660 at §17 per Harris J.

(4) In the light of the CJR, and in particular with the requirement of proportionality referred to in Order 1A rule 1(c) as one of the underlying objectives, “it is an abuse of process to pursue litigation where the value to the litigant of a successful outcome is so small as to make the exercise pointless, viewed against the expenditure of court time and the parties’ time and money” and this would particularly be so for committal proceedings: see Re ZPMC-Red Box Energy Services Limited, supra at §17 citing §§44-47 of Re Sectorguard Plc v Dienne Plc [2009] EWHC 2693 (Ch) at §44 per Lord Briggs sitting as first instance judge.

(5) “The pursuit of committal proceedings which leads merely to the establishment of a purely technical contempt, rather than something of sufficient gravity to justify the imposition of a serious penalty, may lead to the applicant having to pay the respondent’s costs”: see Re Sectorguard Plc v Dienne Plc, supra at §46.

(6) “Committal proceedings are an appropriate way, albeit as a last resort, of seeking to obtain compliance by a party with the court’s order… and they are also an appropriate means of brining to the court’s attention serious rather than technical, still less involuntary, breaches of them”: see Re Sectorguard Plc v Dienne Plc, supra at §47.

(7) Commencing committal proceedings not aimed at obtaining of compliance with court orders is an indication that the committal proceedings are not pursued for legitimate ends: see Sectorguard Plc v Dienne Plc, supra at §47.

(8) “There is an obvious need to guard carefully against the risk of allowing vindictive litigants to use such proceedings to harass persons against whom they have a grievance, whether justified or not”: see Re ZPMC-Red Box Energy Services Limited, supra at §18 citing §§138-139 of Navigator Equities Limited, Vladimir Anatolevich Chernukhin v Oleg Vladimirovich Deripaska [2020] EWHC 1798 (Comm).

(9) Whether a breach is technical or not is determined with the reference to the nature of the obligation broken and the consequences of the breach: see Navigator Equities Limited, Vladimir Anatolevich Chernukhin v Oleg Vladimirovich Deripaska, supra at §139.

30.  Having reviewed the above principles, Harris J made a concluding remark at §19 of Re ZPMC-Red Box Energy Services Limited, supra:-

“What these decisions demonstrate is that in the present litigation culture the decision whether or not to allow contempt proceedings to be prosecuted for failure to comply with a civil court order involves a balancing of various considerations. This includes the utility of the contempt proceedings. If an order is still relevant and a party requires compliance with it to protect their interests, commonly contempt proceedings will be justified in order to enforce compliance and secure respect for the order and the court. Ulterior motive and attempts to use the contempt process to exert pressure is another consideration and where it can be demonstrated to be present will militate against granting leave. The seriousness of the contempt will always be a very important consideration. Maintaining respect for the court and its process is essential if the system of justice is to operate effectively. Breaches of orders are not to be treated lightly. That having been said the seriousness needs to be assessed in the context of the other considerations. If the court is of the view, for example, that ultimately it is unlikely that it would impose a serious penalty and the order is not necessary in order to protect the applicant’s rights the court is more likely to refuse leave even if the court recognises that there appears to have been a knowing breach of an order.” (emphasis added)

31.  His Lordship did not put the propositions in absolute term, but instead used words such as “likely”, “unlikely” and “appears”. Indeed, it would be too simplistic to say that committal proceedings could only be brought for the purpose of enforcement of court orders. In such proceedings, as Kwan VP said in §52 of High Fashion New Media Corporation Ltd v Leong Ma Li [2025] 2 HKC 274 at, the Court should consider:-

“also the interests of the other parties and the interests of upholding the reputation of civil justice in general… The court itself has a very substantial interest in seeing that its orders are upheld” (emphasis added).

32.  Having reviewed the above authorities, I can safely conclude that like all other factors, the seriousness of the alleged contempt and the utility of contempt proceedings depend on the facts and context of the particular case before the Court. It follows that a significant factor in one particular case may feature less significantly in another.

33.  In the present case, assuming, for the sake of argument, that “dealing with assets” in the Undertaking would cover the mere movement of the mere Share Certificates as Wang did, there would be at least a reasonably arguable case that Wang knowingly made a false statement in Wang’s Confirmation that he did not deal with the assets. Wang was the one who gave instructions for moving out the Share Certificates and he himself then kept an eye on the Share Certificates in an account under his control. It is thus at least reasonably arguable that he must have known of this movement himself, and thus, in Wang’s Confirmation, when he said that he did not deal with the assets in the UBS Account. In other words, at least reasonably arguably, Wang deliberately lied.

34.  Although the actus reus of the breach itself might arguably be technical and trivial, and the Contempt Proceedings could be said to serve no practical purpose in that Forever Winner remained and remains the registered shareholder of the Shares, and there is basis (in particular, Yao did nothing after the discovery of the false statement for 5 months, did nothing at all for recovering the Share Certificates but jumped immediately for a contempt) for Mr Maurellet to say that Yao is more concerned to win a score among the various litigation between the parties rather than the administration of justice, I would agree with Ms Lam that knowingly making a false statement is a serious matter which the Court should not treat lightly because the proper administration of justice relies heavily on parties making true statements, and it is thus important to send the public a clear message that knowingly making a false statement would result in serious consequence: see Hwang Joon Sang v Golden Electronics Inc (No 3) [2021] 5 HKLRD 301 at §27 per Coleman J; A. Barnes (t/a Pool Motors) v Michael Seabrook [2010] EWHC 1849 (Admin) at §23 per Hooper LJ. Therefore, I would agree with Ms Lam that the Contempt Proceedings should not be asset aside and should be allowed to continue to trial, if “assets” would cover the Share Certificates.

VII. MATERIAL NON-DISCLOSURES

35.  First and foremost, I have to state clearly that neither Ms Lam nor Ms Ip is the one who settled the Order 52 Statement. Therefore, any accusation of material non-disclosure is not directed against them.

36.  In the context of an ex parte application for leave under Order 52, one must bear in mind that the extent of the duty to make full and frank disclosure is not the same as that in an ex parte application for injunction. In an ex parte application for leave under Order 52:-

(1) the duty to make full and frank disclosure does not extend to law: see Secretary for Justice v Choy Bing Wing, CACV 11/2004, 3 December 2004 at §50 per Yeung JA (as he then was);

(2) the ex parte application serves as a filtering process and thus at this stage, the Court’s primary concern is whether there is a prima facie case of contempt and the duty to make full and frank disclosure does not cover the merits of the possible defence to the contempt: see Wong To Yick Wood Lock Ointment Limited v Sun Ascent Development Limited [2024] HKCFI 2706 at §§13-14 per Lok J; and

(3) in discharge of the duty, in the context of citing a person for contempt for making a false statement the applicant “should also set out the facts and matters which he relies on in contending that it is in the public interest to permit his application to be brought”: see Numeric City Ltd v Lau Chi Wing [2016] 4 HKLRD 812 at §18 per Poon JA (as he then was).

37.  In the present case, the Order 52 Statement did set out the facts relied upon for a prima facie case of contempt. Although it did not explicitly articulate the facts and matters for the public interest and it is always to say that certain things should have been said, with the benefit of hindsight, in my view, the public interest here was obvious – to safeguard the proper administration of justice. In the circumstances, I am satisfied that there was no material non-disclosure.

VIII. CONCLUSION

38.  For the above reasons, I set aside the Order 52 Leave, and dismiss the Contempt Proceedings. I order Yao and Jin Yao to pay Wang the costs of the Set Aside Summons and the Contempt Proceedings summarily assessed at HK$1,800,000, with certificate for two counsel.

39.  It remains for me to thank Mr Maurellet and Mr Sik, counsel for Wang, and Ms Lam and Ms Ip, counsel for Yao and Jin Yao, for their capable assistance.