Huatai Value Investment Fund L. P. and Another v. Super Brilliant Investment Ltd and Another

HCA 270/2025

[2026] HKCFI 5500

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 270 OF 2025

________________________

________________________

_________________________________

DECISION

_________________________________

I.   Introduction and Parties’ case

1.This is the hearing of:

(1)  the Plaintiffs’ (“Ps”) application by Summons dated 11.9.2025 for summary judgment to be entered the against the the Defendants (“Ds”), or alternatively for interim payment of HK$585,586,815.39 (“O 14 Summons”).

(2)  Ds’ application by Summons dated 25.9.2025 to amend their Defence (“Amendment Summons”)

2.The following background is not disputable:

(1)  Ps’ side, Huatai Group, was a financial institution and finance provider.  D2 is a sophisticated businessman and chariman and sexecutive director of a HK-listed company, China Dili Group.  D1 is a BVI company, of which D2 is the sole director, and which is owned, controlled by and/or associated with D2 as an investment vehicle. 

(2)  The case concerns a financial transaction, in which Ps’ side pieced together a structured financing deal for  Ds’ intended investment into Evergrande Property Servicees Group Limited (“EPSGL”).  China Evergrande Group is the parent company of EPSGL.  Ds sought Ps’ side’s help for financing as he did not personally have the amount of money required for the investment.

(3)  Parties had discussions over the structure of the financing deal.  Under the transaction, D1 is the Ordinary Limited Partner, and Ps are the Preferred Limited Partners of a limited partnership named Huatai International Greatyer Bay Area Investment Funds, L P (“the Partnership”).  The Partnership in turn indirectly hold EPSGL shares as the Investment.  A Term Sheet was circulated on 14.8.2020 establishing the core role of Ds and Ps, the respective share and/or charges, the term of the relevant Partnership being for an intial period of 2 years, with option for extension for 1 year. 

(4)  The transaction is underpinned by two key contractual documents, both dated 19.8.2020, being:

(a)  The Deed of Undertaking (“the Deed”); and

(b)  The Limited Partnership Agreement (“LPA”).

D2 further acted as personal guarantee for the transaction.

(5)  By the terms of the Deed, upon the occurrence of “Trigger Events” and/or elapse of 24 months (ie 19.8.2022), Ps can serve a notice exercising the “Put Option” whereby D1 has to pay the contracted amount, reflecting return of the HK$1 Billion initial investment with additional agreed IRR.[1]

(6)  It is also apparent from the contractual documentations that under the transaction:

(a)  D1 is the main benefit recipient if EPSGL performs well, with D1 otbaining 96.25% of any surplus profits;

(b)  Ps’ side’s source of income from the transaction were via fixed income [2].

(7)  On or around August 2021, China Evergrande Group collapsed, with EPSGL affected significantly.  Parties had discussions with Ps demanding additional security, reminding Ds of need for independent legal representation, possibility of selling the stake in EPSGL shares etc.  Eventually, the LPA and the Deed were amended on 13.12.2021. (“1^st Round Amendments”).  

(8)  On or around June to July 2022, matters further deteriorated with Ds failing to pay fixed income payments as contractually obligated.  Ps by email stated that unless further amendemnts to the deal were agreed with cash payment from Ds, once the 24 months elapsed on 19.8.2022, Ps would exercise the Put Option.  Ds did not raise objection on written correspondence. Similar deterioration, with Ps reiterating their right to exercise the Put Option, occurred in October 2022, with Ds seeking further time and/or renegotiation of the investment structure.  

(9)  Parties continued in communication regarding the bad performance of China Evergrande, EPSGL and/or Ds’ financial difficulties.  This led to the Third Amendment Deed (to the LPA) and the Second Amendement Deed (to the Deed) on 4.8.2023, effecting a further extension of the Partnership Term under th e LPA (“the 2^nd Round Amendments”).  The 2^nd Round Amendments was expressly stated to not affect Ps’ accrued and future rights.[3]  D2 was personally included in the relevant email chain communications. 

(10)  By 17.12.2024, Ps served the requisite Notice for triggering the Put Option, which according to terms of the Deed D1 will have to make payments.  It is undisputed that D1 did not so pay the amount.  Ps thereafter via solicitors demanded D1 and D2 for payment. 

(11)  D2 was personally included in the relevant email chain communications regarding events summarized above. 

3.With Ds not paying as requested, Ps started this action.  Procedurally:

(1)  According to Ps’ case, the amount due to Ps as of the date of the hearing is HK$768,404,568.53.

(2)  The Statement of Claim was filed on 12.3.2025.  The original defence by Ds was filed on 4.9.2025 (“DEF”), where Ds’ pleaded defence were: (i) there has been no “Trigger Event” such that payment obligation had not yet arisen, (ii) Ps should exercise other options available under the contracts instead of chasing Ds for payment, and (iii) Ps had failed to mitigate their losses.  

(3)  On 11.9.2025, Ps filed the O 14 Summons seeking summary judgment or alternatively interim payment. 

(4)  On 25.9.2025, Ds filed the Amendment Summons seeking to amend the Defence to introduce additional defences of (i) mistake, (ii) estoppel by convention and (iii) proper interpretation of contract (“ADEF”).  No specific statements were made by D2 to explain the change in Ds’ defences.

(5)  By skeleton and at the hearing, counsel for Ds has focuses on the defences as introduced by the ADEF and did not press for the defences as put forward in the original DEF.  This decision will therefore focus on the defences as introduced by the ADEF.  Suffice it to say I do find the original defences to be meritless and unbelievable as they plainly lack legal and factual basis, and run contrary to the express terms of the contracts and contemporaneous documents. 

4.The Mistake Defence and the Estoppel by Convention Defence by Ds both rely entirely on the alleged Mutual Understanding as put forward by Ds via the affirmation of D2 (“D2 Aff”).  In gist, it is averred that it was mutually understood and agreed between Ps’ side and Ds that:

(1)  The term of the Partnership (“Term”) would be for an intial period of two years, with an option to review for up to three additional years (resulting in a maximum term of 5 years);

(2)  Upon the expiry of the Term but not otherwise, D1 would be required to pay Ps’ side an amount representing the defference (if any) between the latters’ (i) initial contribution plus the agreed minimum return and (ii) actual receipt of the interest and/or dividends, in curcumstances where (ii) is less than (i) (“Shortfall”).  

(“the Mutual Understanding”)

It is undisputed that the second part of the Mutual Understanding does not appear anywhere in the Term Sheet, the Deed, the LPA and/or the 1^st and 2^nd Round Amendments.  

5.It is Ds’ case that:

(1)  The Deed (and subsequent amendments) were entered into by Ds mistakenly believing that the Mutual Understanding would be reflected in the Deed, which it was not, and the Deed was void for common mistake, or alternatively unenforceable for unilateral mistake; (“Mistake Defence”) 

(2)  Ps are estopped by convention from enforcing the strict terms of Clause 2.2(a) of the Deed because the Mutual Understanding was shared, communicated and acted upon when entering into the Deed. (“Estoppel Defence”) 

(3)  The Deed and Clause 2.2(a) (as amended) should be interpreted as only allowing Ps to give notice for Trigger Events insofar as they concern “new” events occurring after 4.8.2023 (ie the 2^nd Round Amendment), but not allowing for invoking against pre-4 August 2023 events. (“Interpretation Defence”). 

(4)  Ds further pleaded in the ADEF that the Trigger Events have been waived due to the 2^nd Round Amendment, but Ds no longer run this defence in their Skeleton and orally at the hearing.  

6.Having carefully considered both sides’ arguments and the evidence filed, I find that Ds have failed to raise any triable defence, Ds’ allegations regarding the Mutual Understanding are unbelievable, and summary judgment shall be entered against Ds as sought in the O 14 Summons.  Consequentially, I further dismiss the Amendment Summons as being bound to fail. 

7.Given my decision, it becomes unnecessary to decide on the application for interim payment.

8.Below are my brief reasons.

II.   Legal Principles for Summary Judgment Applications

9.The principles regarding summary judgment applications under RHC O 14 r 1 are trite and not disputed between parties:

(1)  Summary judgment is for clear cases, that is, cases in which there is no serious material factual dispute and, if a legal issue, then no more than a crisp legal question as well decided summarily as otherwise; 

(2)  The test at the summary stage is whether the defendant’s assertions are believable.  But it must be recognized—because failure to recognize it would create a debt-dodger’s charter—that whether the defendant’s assertions are believable is a question to be answered not by taking those assertions in isolation but rather by taking them in the context of so much of the background as is either undisputed or beyond reasonable dispute; 

(3)  if P’s application is properly constituted, P is prima facie entitled to judgment unless the defendant shows cause to the contrary; 

(4)  In showing cause, the defendant must show that there is an arguable defence or triable issue and provide sufficient particulars. A mere assertion in an affidavit is insufficient, ipso facto, to justify leave to defend; 

(5)  The defendant must satisfy the Court that its evidence is credible and that, on that basis, there is a fair or reasonable probability of the defendant having a real or bona fide defence; 

(6)  The issue is not whether the defendant’s assertions are to be believed, it is whether those assertions are believable; and

(7)  In considering whether there are triable issues, the Court will not take the defence on its face value but test it against the evidence disclosed in the affidavit including matters such as contemporaneous documents, whether the alleged defence is inconsistent with the defence previously put forward or whether the defence is only recently raised despite opportunity being given to the defendant to respond earlier.  The Court will also consider the inherent probability of the defence but what the Court should not do is to conduct a mini-trial on complicated factual issues. 

(8)  Where the defence is shadowy or there is little or no substance in it or the case is almost one in which summary judgment should be ordered, leave to defend conditional on the full amount claimed being paid into court may be ordered.  

See:  HKCP 2026, Vol 1, §14/4/9

Time Rich 08 Limited v DBE (HK) Limited & Ors [2018] HKCA 404, §5.2

Re Safe Rich Industries Ltd (CACV 81/1994, [1994] HKLY 183) at §§11-13

Guanghua SS Holdings v Lim Yew Cheng and Anor [2022] HKCFI 1052 at §13

United Overseas Bank v Total Enterprise Limited and Ors [2025] HKCFI 558 at §23-25

Jiang Jianxin v Yiu Ming Fung [2020] HKCA 916 at §6.4

UMG Recordings Inc & Ors v Profit Chart Development Limited & Ors (CACV 262/2012, unrep, 19 February 2013) at §7

10.Further, as per Hong Kong Topkey Limited v Wintac (Hong Kong) Ltd v Anor [2023] HKCFI 1711, the Amendment Summons should be determined first as this impacts whether Ds may rely on the defences pleaded in the ADEF to oppose the O 14 Summons.  Parties agreed to proceed on the O 14 Summons by considering the merits of the ADEF.  

III.   Analysis

11.It is clear that Ps’ application is properly constituted, and Ps are prima facie entitled to judgment unless Ds shows cause to the contrary.  

A.   The Mutual Understanding

12.Having considered carefully Ds’ submissions and the evidence relied on, I find Ds’ case on the Mutual Understanding entirely unbelievable in light of the undisputed contemporaneous documents and evidence.  

13.The starting point of analysis is Ds’ allegations.  It is trite that mere assertion in an affidavit is insufficient, ipso facto, to justify leave to defend, and Ds must condescend upon particulars.  

14.As correctly pointed out by Counsel for Ps at the hearing, allegations by Ds regarding the Mutual Understanding were entirely devoid of particulars.  There is simply no who, when and where such mutual understanding was supposedly exchanged. In my view, such void in particulars is particularly alarming given the context of this case and the nature of the allegation by Ds.  It is essentially being suggested that the Mutual Understanding was agreed, exchanged and in the minds of both sides since August 2020 (when the Term Sheet, LPA and Deed were signed) all the way to August 2023 (when the 2^nd Round Amendment was executed).  It is also undisputed that throughout, both sides had clear communication channels and voluminous email exchanges, with discussions leading to the 1^st Round and 2^nd Round Amendments.  Numerous key staff from each side were involved, with D2 , a chairman and executive director of a HK-listed company, assisted by a team of professionals.  It is simply unbelievable that none of them can now come up with any particulars as to how the Mutual Understanding was exchanged and agreed orally, and how this was completely missed come time of drafting and execution of the documents.  Nor were there any proper explanations for such lack of particulars.  The heavy reliance by Ds on the asserted “time pressure” in entering into the initial Deed and LPA is neither here nor there, when (i) parties had been in continuous negotiation and did come to further amendments for years regarding the transaction, without any time pressure and affording Ds all the time they needed to review the documents.  

15.Secondly, it is undisputed that the Mutual Understanding was never mentioned in any of the contractual documentations.  Quite to the contrary, the express terms of the LPA and the Deed (together with the amendments) clearly run contrary to the Mutual Understanding, defining the Investment Maturity Date to be 19 August 2022 (despite later rounds of amendments), and allowing for Ps’ issuance of the Put Option Notice.  Given the professional staff involved, it is virtually impossible that each and every one of these staff all had in mind the Mutual Understanding, went through the various drafts of the Term Sheet, Deed and LPA and their amendments over years with voluminous email and WeChat correspondences, yet never said a word despite the very important terms of the Mutual Understanding were evidently not included in the documents.  I have considered Ds’ argument that Ms Rebecca Chan, though a solicitor, was not acting as solicitor for and on behalf of Ds in that capacity.  However, I find this a red-herring, for there is no doubt that she did act for the interest of Ds, was involved in the discussion and viewing of the various drafts, and was in fact the witness to D2’s very signature on the formal agreements.  The issue lies in how incredibly unbelievable it is that all these professional, knowledgeable and capable personnel for Ds’ side could all have conveniently missed for years such a fundamental term in a transaction of such size- not, as Ds would put it, whether Ds were formally represented by solicitors in such capacity.  

16.Counsel for Ds sought to argue that, as D2 puts it, he has heard of “Put Option” but did not understand it in the way it was defined in the agreements, and therefore might have missed the signficiance of the label when it was mentioned on emails and/or formal notices.  Regrettably this is plainly contrived, when, again, D2 himself is clearly an experienced businessman, supported as he was by CPA, solicitors and other staff and/or professionals.  

17.Thirdly, I find that the Mutual Understanding was not even marginally supported by any contemporaneous documents.  The only pieces of documentary evidence counsel for Ds could refer to were (i) the 17 Feb WeChat at [B2/26/550-551], and (ii) the Calculation Schedule at [B2/30/625].  However, on proper analysis, neither support Ds’ case on the Mutual Understanding.  

(1)  Insofar as Ds relied on the 17 Feb WeChat to suggest the Term was agreed to be “2+1+1+1”, that was obviously not the intention.  

(a)  The earlier email dated 18.8.2020 by Ms Rebecca Chan at [B5/1145] explicitly confirmed the Term to “2+1”, as did the eventual contractual documents, specificially referring to this to be the result of speaking with D2.  This was visibly Ds’ request.  This directly contradicts Ds’ case that at the time of August 2020 there was a mutual understanding that the term shall be for “2+1+1+1”. This also contradicts Ds’ case on Rebecca’s allegedly limited and/or administrative role, only performing “sanity checks”.

(b)  Further, the [B2/26/550-551] WeChat explicitly refers back to the actual LPA and Deed contractual documents and terms.  Ds’ reliance on the 17 Feb WeChat is piecemeal, out of context and unbelievable.  

(c)  The fact that events after the LPA and the Deed were signed led to amendments whcih increased the Term (via later discussions, with contemporaneous records explaining why such were reached) to a total of 5 is neither here nor there.  The Court can see from contemporaneous records how and why the Term was discussed and extended, and the Mutual Understanding was never once mentioned. 

(2)  Ds further sought to aruge that the words “股票卖出后资金分配顺序” at [B2/550] meant that “parties also apparently understood and agreed that the final accounting (an exercise similar to Ps’ purported exercise of the ‘put option’) should only take place after the shares of the Target Co are sold…because that was and had always been the expected source of payment.”  The interpretation is contrived and unacceptable.  The plain Chinese words only spoke to the prority of distribution of proceeds if and when there is a sale of the relevant shares. It does not in any way begin to suggest that proceeds of the sale of shares were the only source of repayment, or that repayment/accounting should only occur after sale of the shares.  Such interpretation also does not hold any water since the Guarantee by D2 is itself a source of repayment.  In any event, even this contrived interpretation does not tally with Ds’ case on the Mutual Understnading, which puts repayment conditional upon expiry of the term but not otherwise, not sale of the shares (which may or may not occur).  

(3)  The reliance on the Calculation Schedule is again misplaced.  The Calculation Schedule was sent from Clayton for Ps to Frankie for Ds by WeChat on 23.8.2023.  By then parties had already reached the 2^nd Round Amendment when the Term was already increased (by such formal amendments) to 4+1.  Therefore obviously the calculation would take into account of repayment up to 2025.  This adds nothing to Ds’ case.  Quite to the contrary, immediately before the same message, Clayton for Ps was reminding Frankie for Ds that interest payment was missed and Ps will be sending relevant notices to Ds. This was immediately followed by email dated 22.8.2023 from Clayton to [email protected], copying in D2 and Frankie, attaching the Capital Conversion Notice.  In the same notice, Ps expressly referred to the Put Option and reserved the right to demand the guarantee and indemnity provided by D2.  No objections whatsoever was raised by Ds in writing. Far from supporting Ds’ case, the WeChat record clearly contradicts the existence of the Mutual Understanding, which was suppose to rule out issuance of any Put Option before the end of Term. 

18.Fourth, at the hearing, counsel for Ds sought to argue that the later rounds of amendment, effectively extending the Term of the Partnership to “2+1+1+1”, goes to suggest that there had always been such understanding.  However, as I have stated at the hearing, Ds cannot have their cake and eat it- if Ds argue that the later amendments on the Term reflect the initial understanding on the Term all along, they must also accept that the later amendments not extending the time and/or availability of the Put Option reflect that there was no initial understanding making repayment conditional upon expiry of the Term.  In any event, evidence (if any) of understanding regarding the Term of the Partnership extending to “2+1+1+1”  does not help Ds’ cause.  What they fundamentally need is the second part of the Mutual Understanding ie that repayment is conditional upon and shall only occur after expiry of the Term, and thereby effectively taking away the Put Option, Trigger Events and the terms thereof entirely.  

19.Fifth, counsel for Ds suggested to the effect that that the Court should consider the possibility that D2 as a businessman of his background, it is not uncommon for him not to read every single word on the document and/or reach business deals based on mutual understanding without care of the detailed documentation.  Having considered the matter thoroughly, I am unable to accept such argument here, for the reason that on contemporaneous records parties with their team of staff obviously engaged in thorough, detailed discussions and/or drafting exercise from Term Sheet, to the Deed and LPA, to the rounds of amendments, before coming to the final formal documentation as they were.  They discussed in response to changing circumstances.  Ds, on contemporaneous documents, plainly and indisputably were not as unsophiscated, cavalier and ignorant as they now wish to have this Court accept after the fact. Rebecca Chan, for example, was directly concerning herself with the Term of the Partnership in an email dated 18.8.2020, a matter which goes to the crux of Ds’ case on the Mutual Understanding.  Ds certainly had no inhibition in seeking to rely on correspondences with Frankie and Rebecca whenever Ds perceive the same to be possibly (in a contrived manner) in Ds’ favor.  Ds cannot at the same time disown Frankie and Rebecca’s involvement when it comes to matters clearly against Ds’ favor.  Tested against the undisputed and indisputable background and evidence, Ds’ case that the entire team coveniently did not represent or assist Ds in any meaningful manner is plainly unbelievable afterthought. 

20.Ds suggested that the four notices of intention to exercise the Put Option were perceived as empty threats, and the fact that Ps never acted on them until years later was because Ps knew the notices were contrary to the Mutual Understanding.  This is again unbelievable and misses the point- if the Mutual Understanding ever existed, Ds would have had every opportunity to raise, and would have raised, the Mutual Understanding and/or at least check the terms of the relevant agreements which on their case is fundamentally mistaken.  The fact that no contemporaneous record of such protests exists at all makes Ds’ case wholly incredible.  The bare allegation that Ds did instruct Frankie in June 2022 to reiterate to Ps regarding the Mutual Understanding rings hollow. 

21.Ds also rely heavily on the asserted commercial incredibility of allowing Ps to exercise the Put Option before the expiry of the Term, which Ds say defeats the purpose and objective of the extension.  I find the argument incredible and unsound, for the simple reason that the mechanism was baked inherently in the LPA and the Deed and there is no commercial incredibility in having parties bound by the terms as originally agreed.  Under the original terms, the Partnership was for 2 years, with an option to extend the same by 1 year.  The Investment Maturity Date is defined as 2 years from 19.8.2020, with no suggestion that this is subject to any automatic extension mirroring the Partnership Term.  This simply means Ps are given the option to issue the Put Notice and demand payment after 2 years.  This is not uncommon in commercial transactions (including on demand clauses in eg bank loans which are even more onerous but nonetheless legal and binding), and is entirely able to properly function within the deal between Ps and Ds.  

22.It is also incredible that parties would have agreed orally for there to be no trigger event whatsoever, which is the effect of Ds’ case on the Mutual Understanding making repayment entirely conditional upon expiry of the Term.  The other trigger events as identified by Ps which had occurred and were continuing include cross-default events (D2’s PRC Litigations), extraordinary event (suspension of Dili Shares) and extraordinary event (delisting of Dili).  All these have obvious direct impact on the finances and repayment ability of Ds.  In a transaction involving HK$1.5B plus HK$1B, for a Put Option/payment obligation of a contractually agreed sum of HK$585M, it is non-sensical that Ps would, as the financing side and relying on Ds to pay Ps the promised amount, make Ds’ payment soley conditional upon passing of time of the Term, regardless of what happens in between and how dire Ds’ risks and repayment ability may deteriorate.  Ds’ case is a clear afterthought to suit their needs flying in the face of commercial reality and common sense. 

23.Ultimately, Ds’ case of the Mutual Understanding simply cannot believably hold any waters when tested against the voluminous history of sophiscated negotiation, communication and drafting as shown on indisputable evidence.  How, when and between whom it was reached, and continued to be shared, is entirely unparticularized without proper explanation.  There is further no believable answer at all as to why the Mutual Understanding, fundamental as it is, was never once raised on contemporaneous document throughout years.  This was particularly alarming given the Put Option issue was raised on multiple occasions by Ps to Ds.  The Mutual Understanding was not even raised in the original DEF, and appeared for the first time only shortly after the O 14 Summons with no explanation for the change of case and the resiling from the terms regarding the Put Option and Trigger Events.  Testing Ds’ case against the evidence, seeing the alleged defence is inconsistent with the defence previously put forward, seeing the case is only recently raised despite opportunity being given to the defendant to respond earlier, and considering the inherent improbability identified above, I find Ds’ case on the Mutual Understanding wholly unbelievable.  This is enough to dismiss summarily both the Mistake Defence and the Estoppel Defence.  

B.   The Mistake Defence

24.Given my analysis and finding above, the Mistake Defence is bound to fail.  The core of the defence ie the Mutual Understanding is entirely unbelievable, and Ds cannot possibly mount any defence of mistake, be it common or unilateral. 

25.I further accept Ps’ argument regarding the high threshold required on Ds in proving (i) a fundamental mistake making the contract adventure impossible or makes performance essentially different, (ii) knowledge by Ps of Ds’ mistake.  I find Ds have failed in meeting the threshold. In light of Ds’ silence on the alleged Mutual Understanding and/or the Put Option for years, coupled with its original DEF which acknowledged the Put Option and the full terms and effect of the LPA and the Deed[4], a belated attempt to disavow the entire Put Option contract terms is nothing but disingenuous moonshine.  

26.The Mistake Defence thus stands to be dismissed summarily as wholly unbelievable and lacking in fundamental particulars. 

C.   The Estoppel Defence

27.Again given my analysis and finding above, the Estoppel Defence is bound to fail. The core of the defence ie the Mutual Understanding is entirely unbelievable.  

28.Further, Ds’ case is again entirely unparticularized and unbelievable in seeking to establish the specific elements of a case of estoppel by convention:

(1)  There is no particulars as to when and how the Mutual Understanding was communicated.  In the ADEF, it was barely asserted that the same was “reached”[5] and/or that Ds “were under the belief”[6]. Where the ADEF alleged that the Mutual Understanding/mistaken belief was “shared by Ps”[7], the referred to matters were all references to circumstantial evidence which Ds allege proves the existence of the Mutual Understanding[8].  In D2’s affirmations as well as Ds’ Skeleton, there were similiarly no such particulars, and again only pointed to what Ds say “evidenced”[9] the existence of such Mutual Understanding[10].  Ds case does not get off the ground when Ds cannot even point to what were the words or conduct via which the Mutual Understanding was communicated between parties.  

(2)  Similarly, there are no particulars as to how Ds manifestly acted upon the Mutual Understanding.  Ds’ case remain  bare assertions.  The attempt to tie the Mutual Understanding to the execution of the Dili Share Charge, 2^nd and 3^rd Amendment Deeds (LPA) rings hollow.  Ds cannot even begin to point to when and how Ps ought to have known that Ds were acting upon what statement or conduct by Ps.  The indisputable and clear evidence is that the execution of the Dili Share Charge, 2^nd and 3^rd Amendment Deeds (LPA) were preceded by express communications and consideration with nothing to do with the Mutual Understanding. 

29.The Estoppel Defence thus stands to be dismissed summarily as wholly unbelievable and lacking in fundamental particulars. 

D.   Interpretation Defence

30.The Interpretation Defence falls to be dismissed summarily for being legally without basis.  The terms of Clause 2.2(a)(ii) of the Deed are clear.  The 2^nd Round Amendment was also expressly stated as not to be construed or interpreted as consent/rlease/waiver/prejudice any rights of Ps under the agreements.  The interpretation put forward by Ds, effectively taking away any and all accrued rights of Ps to issue Put Notice for Trigger Events known/reasonably known prior to 4.8.2023, is an interpretation which the plain words of the Deed and the LPA (as amended) cannot hold and thus not a possible construction.  Contrary to Ds’ arguments, there is nothing inherently unreasonable in Ps, despite the extension, to retain the Put Option and demand immediate payment for prior accrued Trigger Events.  This is an inherent mechanism in the original Deed and LPAwhich, whilst contemplating a possible extension of 1 year, did not link the Investment Maturity Date to any such extension, nor require Ps to forgo any rights regarding Trigger Events prior to the extension.  Ds’ argument essentially requires this Court to distort express wordings, add new conditions and/or imply terms which are inconsistent with the express terms of the contract, which as is trite will not be allowed.  I further agree with Ps that Ds’ argument is in essence an argument of waiver, coined in the guise of a meritless interpretation point, which is hopeless in light of the no waiver clauses.  

E.   Condition if Ds be granted conditional leave

31.Given the above, it becomes unnecessary to consider the appropriate terms of any condition to be granted against Ds for conditional leave to defend.  For completeness, as Counsel for Ds fairly accepted at the hearing,  Ds had not adduced any adequate evidence to show Ds’ financial circumstances as impecunious, or allege that payment into court of the full sum as claimed by Ps would make fulfilment of the condition impossible that despite having had the opportunity.  As such, any leave to defend (which is not granted here) would have had to be conditional upon Ds’ payment into court of the full sum as claimed by Ps within 21 days.  

IV.   Conclusion and Costs

32.Given the above, all of Ds’ defences (be it under the DEF or the ADEF) are plainly unbelievable and there is no triable defence.  Summary judgment shall be entered for Ps against Ds as sought by the O 14 Summons.  Further, there being no specific opposition thereto by Ds, calculation of interest payable by Ds to Ps up to 28.6.2026 shall be as set out in Appendix I of Ps’ Skeleton.  Interest payable by Ds to Ps from 29.6.2026 to actual date of payment shall be at the rate of 18% per annum and compounded with the Outstanding Put Option Payment on the last calendar day of each month (as defined in the Statement of Claim). 

33.Costs should follow the event.  Clause 7.3 of the Deed provides that “each Obligor shall… pay to each Preferred Limited Partner the amount of all costs and expenses (including legal feees) incurred by that Preferred Limited Partner in connection with the enforcement of, or the preservation of any rights under, any Investment Document.” A provision that “all” costs will be paid will ordinarily result in an award of costs on the indemnity basis.[11] Applying Bank of China (Hong Kong) Ltd v Twin Profit Ltd [2011] 3 HKC 59, I find no reasons in this case for the Court to disturb parties’ agreement.  Ps are entitled to costs of this action and such costs shall be summarily assessed on indemnity basis.  I further grant certificate for two counsel, justified given the unnecessary complications to the case added by Ds’ amendments introducing new (but ultimately unmeritorious) arguments and wholesale baseless allegations[12], leading to Ps needing to tackle (both legally and factually) both the original DEF and the new ADEF with voluminous evidence to disprove Ds’ bare allegations.  

34.Ps have filed their statement of costs as I have earlier directed, and Ds have filed their objections thereto, which I have considered.  Taking a broad brush approach in exercise of my discretionary powers on costs, I summarily assess costs payable by Ds to Ps at the amount of HK$1,500,000.  The time-span of the transaction between parties, the magnitude of the transaction, the complex nature of the contractual documents and the obstinate but unmeritorious resistance by Ds warranted the longer hours, higher hourly rate and larger number of staff from Ps’ legal representatives.  

DISPOSITION

35.For the reasons given above, I order that Final judgment be entered against D1 and D2 in favour of Ps as per paragraph 32 above.  Ds’ Amendment Summons is hereby dismissed. 

36.Costs shall be payable forthwith by Ds to Ps, with certificate for two counsel, summarily assessed on indemnity basis at HK$1,500,000.00. 

37.Lastly, it remains for me to thank counsel on both sides for their assistance.  

Mr Alexander Tang and Ms Valerie Kwok, instructed by Eversheds Sutherland, for the 1^st and 2^nd Plaintiffs

Ms Astina Au, instructed by Norton Rose Fulbright Hong Kong, for the 1^st and 2^nd Defendants

[1] Annualised internal rate of return. See: SOC, Schedule 1(p).

[2] 6% per annum interest on HK$1.5 Billion loan, and 8% guaranteed return for HK$1 Billion in the Partnership.

[3] The Second Amendment Deed, Clause 4.2(b)

[4] DEF, §5.3, 5.4 “Considering the Deed and the LPA together, the mechanism of the Preferred Limited Partner Put Option (as provided under Clause 2.2(a) of the Deed) is that:-…the Defendants shall refer to the LPA and the Deed for their full terms and effect thereof.”

[5] ADEF §4A

[6] ADEF, §6H, 6I

[7] ADEF §6J

[8] Which as I analysed above they do not.

[9] D2 1^st, §18, 19,

[10] Which as I analysed above they do not.

[11] See: Deutsche Bank (Suisse) SA v Khan [2013] EWHC (Comm) at [19]-[24]; Friston on Costs, 4^th ed., §16.67

[12] As described by Ps, “Ds’ shifting stance and kitchen-sink approach contributed to the voluminosirty of the evidence before this Court”, which I agree.