YONG LI INVESTMENTS LIMITED v KWAN TO YIN,APPOINTED BY AN ORDER DATED2NDSEPTEMBER 2022 TO REPRESENTTHE ESTATE OF LEE SHING, DECEASED

HCA 1050/2015 and HCA 542/2016

(Consolidated)

[2026] HKCFI 4121

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NOS 1050 OF 2015 AND 542 OF 2016

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BETWEEN

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(Consolidated pursuant to the Order of

Master Gary CC Lam dated 29 January 2018)

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DECISION (STAY OF EXECUTION)

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INTRODUCTION

1.On 29 April 2026, this Court handed down a judgment in this matter after a trial (“Judgment”) and in this decision, the Court will continue to adopt the nomenclature therein unless otherwise indicated.

2.Pursuant to the Judgment, it is adjudged and ordered that:

Re the 50m Shares Claim:

(i) Robin/D shall pay to YLIL (“P1”) the sum of HKD 3,600,000 as damages and interest thereon at prime rate plus 1% per annum from the date of issue of the writ in HCA 1050/2015 until date of judgment and thereafter at judgment rate until full payment.

Re the Promissory Note Claim:

(ii) Robin/D shall pay Shing’s estate (“P2”) the sum of HKD 50,856,000 as damages and interest thereon at prime rate plus 1 % per annum from the date of the writ in HCA 562/2016 Action until date of judgment and thereafter at judgment rate until full payment

Re D’s Counterclaim

(iii) D’s Counterclaim be dismissed

Re: Costs

(iv) D do pay P1 the costs of the claim in the Consolidated Actions and/or HCA 1050/2015, including any costs reserved, to be taxed on party and party basis, if not agreed;

(v) D do pay P2 the costs of the claim in the Consolidated Actions and/or under HCA 562/2016, including any costs reserved, to be taxed on party and party basis, if not agreed;

(vi) D do pay Ps costs of the Counterclaim including any costs reserved, to be taxed on party and party basis, if not agreed;

(vii) The above costs orders nisi shall be final after 14 days.

3.On 8 May 2026, D issued a summons for stay of execution (“Stay Summons”) supported by his affidavit of the same date sworn and notarised before a solicitor and notary public in Brisbane in Australia, and pursuant to directions given by the Court on 22 May 2026, Ps filed and served Madam Kwan’s affirmation in opposition on 4 June 2026, and D filed his reply affidavit on 18 June 2026.

4.D is now acting in person.

Discussion

5.The applicable legal principles on an application for stay of execution are well known and have been set out by Ps Counsel in paragraph 7 of his written submissions. There is no dispute on those principles and I will not repeat them here.

6.No grounds of appeal were set out in D’s affidavit in support of the Stay Summons. D ‘s explanation was that at the time of issue of the Stay Summons, he was still preparing his grounds as the deadline for filing his notice of appeal had not yet expired. In his supporting affidavit, his ground for application for stay was simply that if no stay was granted, there would be a real risk that that taxation and/or enforcement would proceed before his intended appeal was determined thereby causing prejudice and potentially unnecessary procedural steps that may later need to be reversed.

7.D’s Notice of Appeal was subsequently filed on 27 May 2026 (“NoA”).

8.It is D’s submission that his intended appeal raises arguable issues and that substantial prejudice may be occasioned absent a stay, and it is therefore just and convenient that the status quo be preserved pending determination of his intended appeal.

9.There are a total of 7 grounds set out in Attachment A of D’s NoA.

Ground 1 - Error in finding existence of the 2^nd Oral Agreement [In the Judgment, this was referred to as the 2^nd Oral Agreement about the Note]

10.Under this ground, D has set out 4 sub-paragraphs, namely the Court:

(a) failed to properly resolve material inconsistencies in Ps’ evidence as to the timing and formation of the alleged agreement;

(b) failed to properly consider contemporaneous documentary evidence inconsistent with the alleged oral agreement, including solicitor correspondence demanding payment under the Promissory Note;

(c) failed to properly address the absence of consideration for the alleged variation or forbearance; and

(d) erred in drawing adverse inferences from silence, delay, and post-event conduct

11.In relation to sub-paragraphs (a) and (b), in D’s written submissions, he has referred to the “May 2010 letter before action” which he submits to be inconsistent with Shing’s case on the pleaded forbearance until December 2010, and that such raises an arguable issue as to whether the chronology of the pleaded 2^nd Oral Agreement and the surrounding documentary evidence were fully reconciled.

12.As set out in paragraph 120 of the Judgment, Shing/YLIL had instructed solicitors to write to D, on 10 May 2010 with a follow up letter on 27 May 2010, complaining about D’s breach of his obligations under the Deed as varied by the Letter and threatening legal action. There was no mention of the 2^nd Oral Agreement in that letter. However, in the reply letter from D’s then solicitors, there was also no mention of any global settlement by D. Nor was it mentioned by D that Shing was not entitled to claim as Shing knew that D had already exercised his rights under Promissory Note B and that there were no other promissory notes including the 50.856m PN.

13.The undisputed fact was that Shing did not commence legal action for the 50.856m PN Claim after the exchange of those letters in May 2010 and it was only on 2 March 2016 that Shing commenced HCA 542/2016. As seen in paragraphs 127 – 131, it was Shing’s written evidence that there were further negotiations between him and D in early 2010. D’s own evidence that his relationship with Shing had remained good until the 2010 AGM.

14.D’s case was essentially that there was the global settlement in December 2009. In light of this Court’s finding that there was no global settlement in December 2009, both Shing and D would continue to be bound by their respective obligations under the Deed as varied by the Letter until the letter dated 17 June 2019 when Ps’ solicitors wrote to D’s solicitors indicating Ps accepted D’s repudiation of the Deed in light of his breach.

15.The reasons for the Court finding that it is more probable than not that there was the 2^nd Oral Agreement have been set out in paragraphs 127 – 133 of the Judgment. The Court was well aware of the May 2010 letters which were set out in paragraph 120 of the Judgment. There was in fact a further letter before action dated 19 February 2016 sent by Shing’s solicitors to D setting out the 2^nd Oral Agreement and alleging D’s breach thereof. There was no response by D to that letter. There was also no explanation from D as to why he did not respond.

16.In any event, apart from the May 2010 letters, D failed to identify what other material inconsistencies in Ps’ evidence as to the timing and formation of the 2^nd Oral Agreement, and also which contemporaneous documentary evidence he alleged to be inconsistent with the 2^nd Oral Agreement.

17.As for sub-ground (c), Shing’s pleaded case was that he agreed to forbear to sue D over his non-compliance with the terms of the Deed and the Letter, as D agreed to transfer to him the 50.856PN by December 2010. The 2^nd Oral Agreement simply extended the deadline for D to transfer the 50.856 PN to Shing.

18.Having considered all the above, I come to the view that Ground 1 sub-paragraphs (a), (b) and (c) is not arguable. As for sub-paragraph (d), this is the same as Ground 3 which I will consider below.

Ground 2 - Failure to properly evaluate documentary evidence

19.D complains under this ground that the Court failed to give proper weight to contemporaneous written agreements and documentary evidence inconsistent with Rs’ case.

20.In D’s submission, he alleges that the significance and legal effect of the “SPA” dated 9 July 2009 (which was defined as the “Chinese Agreement” in the Judgment) were not fully addressed by this Court and that the payment of HKD 12m of the consideration directly to CTF raises arguable issues relevant to the determination of liability.

21.It was not disputed that HKD 12m of the consideration under the SPA/Chinese Agreement was paid directly to CTF by and/or on behalf of YLIL. Shing’s written evidence was that this was at the request of D. It was also not disputed that this arrangement was agreed by D and CTF, and YLIL’s purchase of the 312,000,000 of the issued shares of the Company was duly completed on 10 July 2009. It is therefore not clear what D is referring in his submissions and also in his reply submissions, when he refers to “the proper interpretation and effect of this arrangement raise arguable issues relevant to the determination of liability/findings on liability”.

22.It is also D’s submission that the findings concerning the Deed, as varied by the Letter, and the 2^nd Oral Agreement did not dispose of all issues relating to liability, and that there are arguable issues as to the proper interpretation and continuing legal effect of the Deed in light of subsequent performance and variations. In D’s reply submissions, he maintains that arguable issues arise as to whether the contractual framework giving rise to liability had been fully performed and analysed.

23.The burden was on D to prove that there was the global settlement, and also the June 2009 Co-operation Agreement. Notwithstanding his above submissions, D has failed to identify which contemporaneous documentary evidence this Court has failed to give proper weight to and/or to evaluate, and he also failed to identify which documentary evidence was inconsistent with Rs’ case and would support D’s case. In my view, this ground is not arguable.

Ground 3 - Misapplication of inferential reasoning

24.As in sub paragraph (d) under Ground 1, D complains that this Court erred in relying on inference drawn from silence, delay, and subsequent conduct as a basis for finding contractual formation and liability.

25.As pointed out by Ps’ Counsel, it is not clear what D is referring to in making the above generic comments. D has not specified how this Court has misapplied what he called “inferential reasoning”.

26.Insofar as these complaints are in relation to D’s case of there being the global settlement/December 2009 Settlement Agreement, D contends that undue weight was placed on the absence of documentary records.

27.Not only was there a lack of documentary evidence to support D’s case, the Court also pointed out in the Judgment that there was no mention by D of any global settlement in the 2010 Action and that the first time D mentioned the global settlement was in the Consolidated Actions. In any event, these were not the only matters relied on by this Court in coming to the finding that there was no global settlement as pleaded by D. The reasons for the Court’s finding have been set out in paragraphs 92-126.

28.Having considered the above, I am also of the view that this ground is also not arguable.

Ground 4 - Misapplication of entire agreement clause principles

29.D complains that this Court failed properly to consider and apply the legal effect of contractual entire agreement provisions.

30.As pointed out by Ps’ Counsel, the Chinese Agreement was drafted by D’s own solicitors. As said by this Court in paragraph 141 of the Judgment, had there been an agreement between D and Shing that D should continue to remain in the office of executive directorship, one would expect this to be recorded in the Chinese Agreement.

31.D’s complaint is a bare assertion and I do not find this ground arguable.

Ground 5 - Findings on liability

32.D complains that the findings that D was in breach and liable are not supported by the evidence as a whole.

33.The findings were factual and D has not been able to demonstrate why the Court is plainly wrong in those findings. This ground is not arguable.

Ground 6 - Damages

34.D complains that the award of HKD 50,856,000 was excessive and not properly supported by evidence of causation, valuation, or quantification.

35.The award was based on the face value of the 50.856m PN. As pointed out by Ps’ Counsel, there was no positive case pleaded by D on quantum in the event liability was established, and there were no submissions made on behalf of D in relation to the quantum claimed in the event of liability being found against D.

36.This ground is again not arguable now.

Ground 7 - Enforceability and commercial effect of Deed

37.D complains that this Court failed to properly consider the construction and legal effect of the relevant Deed and its contractual framework.

38.As mentioned earlier, having found that there was no global settlement in the terms of the pleaded December 2009 Settlement Agreement, the legal effect was that D had to comply with his obligations under the Deed as varied by the Letter by the deadline extended by the 2^nd Oral Agreement. As D has failed to do so, the legal effect is that he has to pay damages to P2. This ground is again not arguable.

Conclusion of D’s grounds

39.In light of all above said, D has not been able to demonstrate to this Court that its factual findings were plainly wrong, and this Court is not convinced that there exist arguable grounds of appeal.

Prejudice

40.D submits that there is a real possibility that bankruptcy proceedings may be commenced against D before determination of his appeal. However, there is no evidence in D’s affidavits as to his financial position, or inability to pay. There is also no evidence that if he complies with the order that Ps will not be able to repay him if D were to succeed with his appeal. There is further no evidence as to any serious deleterious effect of any bankruptcy proceedings on D’s financial position, reputation, and commercial affairs.

Conclusion

41.In light of the above, I dismiss D’s Stay Summons. D shall pay Ps’ costs of this application on party and party basis, to be taxed if not agreed.

Mr Felix Ng, instructed by Messrs Y.S. Lau & Partners, for the 1^st and 2^nd Plaintiffs

The Defendant, acting in person