Chinese Corporate Finance, Ltd v. Daniel Kan Pui Kei and Others

HCA 2954/2017 and
HCA 512/2021

(Consolidated)

[2026] HKCFI 3708

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NOS. 2954 OF 2017 AND 512 OF 2021

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D E C I S I O N

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1.The 1st and 2nd Defendants apply for leave to give evidence at trial by video-conferencing facilities.  They say that they are unable to travel to Hong Kong for medical reasons.

The background

2.The Plaintiff’s action has been set down for a 21-day trial, due to commence on 28th October 2026.  The pre-trial review is scheduled to take place on 2nd July 2026.

3.There is no dispute that the 1st and 2nd Defendants are key witnesses whose credibility is an important issue in these proceedings.  The Plaintiff carried on business as a corporate finance adviser.  The 1st and 2nd Defendants were its employees.  The Plaintiff’s claim is that the 1st and 2nd Defendants wrongfully set up competing businesses, and conspired with others, including the 3rd Defendant, 5th Defendant and 6th Defendant, to divert business to the 3rd Defendant for their (the 1st and 2nd Defendants’) benefit.  The 1st and 2nd Defendants say that the 3rd Defendant was set up with the Plaintiff’s knowledge and authority and that the Plaintiff’s senior management had orally agreed to allow them to set up and run the 3rd Defendant.  They deny diversion of the Plaintiff’s business or a conspiracy.

The relevant principles

4.The relevant principles were summarised by Anthony Chan J (as he then was) in Re Nobility School [2020] HKCFI 891 at [9], after considering a number of authorities, including those sought to be relied on by the 1st and 2nd Defendants in the present case.  The principles are as follows.

“ (1) The giving of evidence by video conferencing facilities (“VCF”) is an exception;

(2) The starting point is that proceedings are conducted in court.  I would add that this is more important when it comes to a trial;

(3) Sound reason is required to justify a departure from the starting point;

(4) The solemnity of court proceedings and its atmosphere is highly important in the taking of evidence;

(5) The court may be more disposed to exercise its discretion to allow evidence by VCF in respect of technical or purely factual evidence which involves no serious issue on credibility or relatively unimportant evidence;

(6) Where the credibility of the witness is seriously contested, it is important for the witness to be examined under the solemn atmosphere of the court;

(7) Costs and convenience may be important considerations which the court will have to weigh in the determination of the application;

(8) Ultimately, it is a matter of judgment of the court choosing the course best calculated to achieve a just result by taking into account all the material considerations, including whether the witness is capable of attending the proceedings, any prejudice to the other party, the Underlying Objectives, any delay to the proceedings and practical considerations like the availability of the facilities (see Practice Direction 29).”

5.The 1st and 2nd Defendants rely on the Court (Remote Hearing) Ordinance (Cap.654) (“the Ordinance”), which came into effect on 28th March 2025, the long title of which states that it is an ordinance “to provide for the application for, and the operation and effect of, remote hearings; to provide for fair disposal of, and public access to, remote hearings”.  They say that the Judiciary is now prepared to conduct remote hearings more often where circumstances allow, referring to the Legislative Council Brief of 20th November 2024 in relation to the Ordinance when it was at the Bills stage.

6.However, as is clear from that document^[1] and from the Ordinance, and indeed as a matter of common sense, the key consideration is that of the interests of justice.  Section 6(6) of the Ordinance provides that:

“ An order may only be made under subsection (1) or (4) [for a proceeding to be conducted through a remote medium] if the court, after considering the factors under section 9, is satisfied that, in the circumstances of the case, it is in the interests of justice to make the order.”

7.As to the factors to be taken into account, s.9 of the Ordinance provides as follows.

“ In deciding whether to make, affirm, vary or revoke a remote hearing order for a proceeding under section 6, 7 or 8, the court must consider the following factors (if applicable) –

(a) the nature, complexity and urgency of the proceeding;

(b) the nature of the evidence intended to be adduced;

(c) the views of the parties;

(d) the ability of the parties to engage with and follow the proceeding (if conducted through a remote medium);

(e) the personal or special circumstances of the parties, including any physical, visual or auditory impairment, cognitive difference and mental or psychological health issue;

(f) the maintenance of the rights of the parties;

(g) whether the parties are legally represented;

(h) whether the privileged communication between the parties and their respective legal representatives may be affected;

(i) whether the parties and the parties’ legal representatives can conduct their case effectively;

(j) the measures to be taken to ensure that evidence is given freely without coercion or other influence;

(k) the potential impact of the order on the assessment of the credibility of witnesses and the reliability of the evidence presented;

(l) whether the use of the remote medium is likely to promote fair and efficient disposal of the proceeding;

(m) whether the right to a fair trial can be effectively maintained;

(n) the quality and security of the remote hearing facilities and their availability to the parties;

(o) whether there is any public order, security, public health or emergency concern that makes it undesirable or impracticable for the parties to attend the proceeding in person;

(p)   any other relevant considerations.”

8.The provisions of the Ordinance do not contradict any of the principles set out in Re Nobility School.

The 1st Defendant

9.The 1st Defendant is residing in Shanxi Province in mainland China.  It is said that he has been diagnosed with coronary atherosclerotic heart disease and heart failure with physical activity limitation under the New York Heart Association Functional Classification of Stage II, and that he has been advised by a doctor not to travel or undertake long-term journeys by flight or train for a minimum of six months from the date of diagnosis.  In support of this, the 1st Defendant has produced a one-page document dated 25th May 2026 from a hospital in Shanxi Province to certify the said diagnosis and the recommendation regarding travel.

10.The assessment of the veracity and reliability of the 1st Defendant’s evidence is critical to the determination of the Plaintiff’s claim.  The case is of some complexity and it can be expected that the 1st Defendant will be cross-examined at length by reference to a substantial number of documents.  This is a classic situation where, prima facie, the evidence ought to be given in the solemn setting of a court room.  Use of video-conferencing facilities would introduce potential unnecessary disruptions to the giving of the evidence, arising for example from time lag in transmission of audio or video signals, poor quality audio or video connections, and misunderstandings regarding the documents being referred to.  These would interfere with the assessment of the veracity and reliability of the 1st Defendant’s evidence.  For example, it may be difficult to tell whether the 1st Defendant is having genuine difficulties in understanding a question, or whether he is being evasive.  The Plaintiff would therefore be prejudiced in obtaining a fair trial of its claim.  Mr Yip submitted that the Plaintiff would not be handicapped since nowadays, the court places more emphasis on contemporaneous documents rather than the demeanour of the witness.  However, in the present case, the issues will not be determined purely on the documents; the credibility of the 1st Defendant (and 2nd Defendant) is important.  As Mr Westbrook points out, they are not mere witnesses; they are parties to the proceedings and if they seek to give evidence in support of their case they should be prepared to come to court to have it tested.

11.On the other hand, the 1st Defendant’s claim that he cannot travel to Hong Kong to give evidence for medical reasons cannot be lightly brushed aside.  If he is not able to give evidence at trial, then he obviously would suffer great prejudice as a result.  It is therefore necessary to give careful consideration to the 1st Defendant’s claim as to why he is unable to travel to Hong Kong.

12.I agree with the Plaintiff that the 1st Defendant’s evidence in support of his claim not to be able to attend trial is manifestly inadequate.

12.1     The certificate put forward at best shows no more than a single outpatient attendance, and sets out no clinical findings or investigations, or medical reasons, for the recommendation against travel for six months.

12.2     The Plaintiff has adduced evidence from a cardiologist to explain, by reference to published clinical literature and guidelines, that a patient who has been diagnosed with coronary atherosclerotic heart disease, or heart failure, classified as New York Heart Association Class II, is generally fit to travel by air (up to seven hours) or train, without restriction, provided that the patient is clinically stable, on appropriate treatment, and has not had changes in symptoms, hospitalisations or medications within the preceding four to six weeks.

12.3     The 1st Defendant has not suggested that the cardiologist’s evidence is incorrect in any way.  It is merely said that he has not examined the 1st Defendant and that there should not be a trial by affidavit of the seriousness of the 1st Defendant’s condition and whether it prevents him from travelling to Hong Kong.  However, the Plaintiff is not asking for any finding in this regard, but simply saying that on the 1st Defendant’s own evidence of his diagnosis, the published clinical literature and guidelines say that it is safe to fly (up to seven hours) and to take the train.

12.4     The Plaintiff says, and the 1st Defendant does not deny, that travelling by plane from Shanxi to Hong Kong only takes four to five hours, and that it would also be possible to travel by train, taking eleven to thirteen hours.

13.Furthermore, the Plaintiff has pointed out that the 1st Defendant is licensed under the Securities and Futures Ordinance (Cap.571) as a Responsible Officer of two companies whose principal place of business is in Hong Kong, for the periods from 2nd March 2022 to 30th April 2026, and from 6th May 2026, respectively.  The SFC only grants licences to individuals if they will come to Hong Kong to carry out regulated activities on behalf of the corporations to which they are accredited, and is likely to revoke the licences of those who do not genuinely perform regulated functions in Hong Kong.  The 1st Defendant does not deny any of this, or say that he does not carry on regulated functions in Hong Kong.  Nor does he explain how, if he is able to carry on such functions in Hong Kong, he is not able to come to give evidence in Hong Kong.  Mr Yip says that the SFC circular relied on does not indicate how frequently the Responsible Officer has to be in Hong Kong, and in any event the court does not need to be concerned with whether the 1st Defendant complies with the SFC’s requirements.  He further points out that since the 1st Defendant’s diagnosis was recent (on 25th May 2026), the fact of any earlier licensing does not lead to the inference that the claim of a medical condition is false.  However, the point is that the SFC only licenses individuals who do actually perform the regulated functions in Hong Kong.  Mr Westbrook points out that the relevant SFC guidance explains that itinerant professionals who only spend short periods in Hong Kong should not be Responsible Officers.  The 1st Defendant has not explained how his medical condition and professed inability to travel to Hong Kong during the next six months (from the date of his certificate) can be compatible with the continuation of his licence.

14.It is also relevant to bear in mind the video-conferencing arrangements proposed.  All that is suggested is that the 1st Defendant will give evidence from the business conference room of a hotel.  No indication has been given as to the stability or quality of the video-conferencing facilities or the technical support available, and no offer has been made for the provision of an independent supervising solicitor or invigilator, to ensure that the evidence is being given free from interference and without any assistance.  There is only a suggestion that the Plaintiff’s representatives can attend, presumably at the Plaintiff’s own cost, with which the Plaintiff understandably does not agree.  Mr Yip says that if the Plaintiff is not happy with the venue arrangements, this can be agreed later.  This is unsatisfactory.  An applicant seeking to depart from the norm of giving evidence in court should not be seeking an order on the basis that an acceptable way of doing so can be figured out at a later stage.

15.I am therefore not persuaded that it is in the interests of justice to order that the 1st Defendant should give evidence at trial by way of video‑conferencing facilities.

The 2nd Defendant

16.The 2nd Defendant is residing in Split, Croatia.  It is said that he has been diagnosed with Type 1 Diabetes Mellitus, and that he has been advised by his general practitioner that undertaking long-haul air travel poses a material and avoidable risk to his health, as long-haul flights pose significant risks for individuals with Type 1 diabetes, including but not limited to (1) severe hypoglycaemia (in that disruption of regular mealtimes, sleep cycles and insulin schedules increases the likelihood of sudden, incapacitating low blood sugar levels, which can result in a loss of consciousness, seizures or inability to self-treat, and which cannot be managed safely during a flight), and (2) diabetic ketoacidosis (ie. that extended periods of travel, combined with potential dehydration or insulin timing errors, can precipitate this potentially life-threatening condition).

17.As with the 1st Defendant, the assessment of the veracity and reliability of the 2nd Defendant’s evidence is critical to the determination of the Plaintiff’s claim.  I repeat my observations in relation to the complexity of the case, and the nature of the cross-examination which will take place.  Again, the starting point is that the evidence ought to be given in the solemn setting of a courtroom, and use of video-conferencing facilities would introduce potential unnecessary disruptions to the giving of the 2nd Defendant’s evidence.

18.I then turn to the 2nd Defendant’s claim that he cannot travel to Hong Kong to give evidence for medical reasons.  Again, I bear in mind that it is important to the 2nd Defendant that his evidence be presented at trial.

19.Whilst the 2nd Defendant’s general practitioner (who is based in London) advises that the 2nd Defendant should not undertake long haul air travel, as long haul flights pose significant risks for individuals with Type 1 diabetes,

19.1     the Plaintiff has adduced evidence from a medical expert who has been involved with late stage clinical trials in (inter alia) diabetes, and whose expertise is not challenged for present purposes, to say that having Type 1 diabetes is not a contraindication to long haul air travel, according to expert and professional bodies, and that professional bodies such as the American Diabetes Association actually provide advice as to how to prepare medicines and equipment for the purpose of such travel;

19.2     the 2nd Defendant has apparently had Type 1 diabetes since infancy.  The Plaintiff has records of the leave taken by the 2nd Defendant from 2010 to 2016 and suggested that having regard to the duration of some of these periods, at least some of them involved overseas travel.  The 2nd Defendant has not denied this;

19.3     indeed, the 2nd Defendant has not explained how he has (or has not) travelled since infancy.  This includes how he was able to travel from Hong Kong to Split, or from Hong Kong to London;

19.4     similarly to the 1st Defendant, the 2nd Defendant has been licensed under the Securities and Futures Ordinance as a Responsible Officer of a company whose principal place of business is in Hong Kong, since 3rd October 2022.  As with the 1st Defendant, the 2nd Defendant does not deny carrying out regulated functions in Hong Kong or explain how, if he does so, he is not able to come to give evidence in Hong Kong.

20.Similarly to the 1st Defendant, the 2nd Defendant has simply proposed giving evidence from a conference room of a hotel.  He asserts that the hotel has a stable internet connection, but provides nothing to support this.  Again, no offer has been made for the provision of an independent supervising solicitor or invigilator.  There is only a suggestion that the Plaintiff’s representatives can attend, presumably at the Plaintiff’s own cost.

21.There is also the further consideration of the six-hour time difference between Croatia and Hong Kong.  No proposal prior to today has been made as to the sitting arrangements at trial which would enable the taking of evidence for what is likely to be a substantial duration, and which would not disrupt the scheduled dates fixed for the trial.  When asked about this, Mr Yip says that the 2nd Defendant would simply stay up late, or get up early, to meet the court’s schedule.  It is unclear to me that this is practical, having regard to the time difference.  The 2nd Defendant has not indicated in his evidence that he would do this.

22.I am therefore not persuaded that it is in the interests of justice to order that the 2nd Defendant should give evidence at trial by way of video-conferencing facilities.

Disposition

23.I dismiss the 1st and 2nd Defendants’ summons.

24.I will now hear the parties on costs.

Mr Simon Westbrook SC leading Mr Billy Liu, instructed by Minterellison LLP, for the Plaintiff

Mr Richard Yip, instructed by Cedric & Co., for the 1^st and 2^nd Defendants