Melco Resorts (Macau) Ltd v. Wu Xuhui

HCA 1295/2024

[2026] HKCFI 5883

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO. 1295 OF 2024

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DECISION

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A.   INTRODUCTION

1.This is the defendant’s appeal against the order of a Master who set aside and re-granted:

(1)  Master J Wong’s order dated 13 May 2025 for service out of jurisdiction (“the Service Out Order”);

(2)  the order of Master Maurice Lam dated 14 October 2025 for substituted service (“the Substituted Service Order”)

(collectively “the Ex Parte Orders”).

2.There is no dispute that the learned Master has rightly set aside the Ex Parte Orders by reason of material non-disclosure on the part of the plaintiff.  The only issue here is whether those orders should be re-granted.

B.   BACKGROUND

B1.  The plaintiff’s claims

3.The plaintiff was and is an operator of casinos and gaming resorts in Macau Special Administrative Region whereas the defendant is a patron of the aforesaid casinos.

4.On around 8 July 2023, the plaintiff and the defendant entered into a credit agreement, and the terms of which were contained in an Application for Gaming Credit Facility dated 8 July 2023 (“the 2023 Agreement”).

5.At around the time when the defendant entered into the 2023 Agreement, he delivered to the plaintiff a signed blank cheque of Industrial and Commercial Bank of China (Asia) Limited (“ICBC”) (“the Blank Cheque” or “the ICBC Cheque”).

6.By virtue of the 2023 Agreement, the plaintiff advanced to the defendant credit in the total sum of HK$20 million (“the Loan”) in July 2023. 

7.By around June 2024, the outstanding amount of the Loan was HK$11,715,200.  As the defendant failed to repay the same, the plaintiff filled in the Blank Cheque so as to recover the said sum (“the Completed Cheque”), and presented the Completed Cheque for payment.  However, the Completed Cheque was returned dishonoured.

8.The plaintiff therefore claims against the defendant in this action for, inter alia:

(1)  the sum of $11,715,200 being the amount payable to the plaintiff on the Completed Cheque (“the Cheque Claim”); and alternatively,

(2)  the same sum being the outstanding amount of credit advanced by the plaintiff to the defendant pursuant to the 2023 Agreement (“the Contractual Claim”).

B2.  The defendant’s case

9.It is undisputed that the defendant had signed the 2023 Agreement and that he had given the Blank Cheque to the plaintiff.

10.However, he alleges that:

(1)  In around 2017, he entered into a credit facility arrangement with the plaintiff, pursuant to which he gave the plaintiff the Blank Cheque;

(2)  The bank account to which the Blank Cheque was tied (“the ICBC Account”) was forcibly closed by ICBC in around November 2020;

(3)  Therefore, in around December 2020, he informed Ms Joyce Xu (the senior relationship manager assigned to him by the plaintiff) about the closure of the ICBC Account;

(4)  Ms Joyce Xu told the defendant that he could provide a replacement blank cheque on his next trip to Macau, and that there was no hurry for him to do so;

(5)  In July 2023, the plaintiff requested the defendant to sign the 2023 Agreement which he did.  By then, Ms Joyce Xu had already left the plaintiff, and another relationship manager (Ms Vivian Yuen) was assigned to the defendant;

(6)  In around October 2023, the defendant had a meal with Ms Joyce Xu, during which Ms Joyce Xu reminded the defendant about the ICBC Cheque;

(7)  The defendant then had a call with Ms Vivian Yuen in which he told her about the ICBC Cheque issue;

(8)  On around 24 January 2024, the defendant provided Ms Joyce Xu with a cheque in the sum of HK$3 million (“the BOC Cheque”), which was passed by her to Ms Vivian Yuen;

(9)  In around June 2024, the defendant received a call from Ms Vivian Yuen who requested him to repay the funds advanced to him.  Ms Yuen mentioned that the plaintiff would deposit the ICBC Cheque if he failed to repay.  The defendant reminded her at that point that the ICBC Cheque was no longer valid because the ICBC Account had been closed;

(10)  Despite the plaintiff’s knowledge that the ICBC Cheque was no longer valid, the plaintiff still proceeded to fill in the Blank Cheque and presented the Completed Cheque for payment.

B3.  The procedural history of this action

11.On 3 July 2024, the plaintiff issued the Writ herein which was served on the following day at 4 addresses in Hong Kong.  The plaintiff further took out a summons for summary judgment on 6 August 2024.

12.On 21 August 2024, the defendant took out a summons to set aside the service of the Writ, which was acceded to on 27 January 2025.

13.On 26 March 2025, the plaintiff made an ex parte application by virtue of an affirmation made by its solicitor (Ms Chan Felicia Chloe of Messrs. Johnson Stokes & Master) for leave to issue a concurrent writ of summons and serve the same out of jurisdiction pursuant to Order 11 rules 1(1)(e), 4 and 5A of the Rules of the High Court.  

14.In response to the plaintiff’s application, the Court raised certain requisitions.  In reply, the plaintiff filed the 2^nd and 3^rd Affidavits of Man Michelle Chor Lam (another solicitor of Messrs. Johnson Stokes & Master).

15.The Service Out Order was eventually granted on 13 May 2025.

16.On 11 September 2025, the plaintiff further sought an order for substituted service, which was granted on 14 October 2025.

17.On 13 November 2025, the defendant took out a summons (“the Summons”) to set aside the Ex Parte Orders, on the grounds that:

(1)  There had been material non-disclosure when the plaintiff applied for the Service Out Order;

(2)  Hong Kong is not clearly and distinctly the appropriate forum for the trial of this action.

18.The learned Master who heard the application accepted that the plaintiff’s omission to mention the following matters in its application for the Service Out Order amount to material non-disclosure:

(1)  None of the Order 11 rule 1 gateways is applicable to the Contractual Claim;

(2)  The 2023 Agreement is in fact governed by Macau law;

(3)  The 2023 Agreement contains a non-exclusive jurisdiction clause in favour of the Macau court.

19.Be that as it may, the learned Master ordered that there be a re-grant of the Ex Parte Orders.

C.   ISSUE IN THIS APPEAL

20.As aforesaid, there is no dispute that the learned Master has rightly set aside the Ex Parte Orders.  The only issue here is whether those orders should be re-granted.

21.As this is an appeal brought against Master’s decision, the above issue will be dealt with by way of an actual rehearing of the application. 

22.It should also be mentioned at this point that the plaintiff accepted at the appeal hearing that, in the event this Court dismisses the appeal:

(1)  there should be still be a stay of the Contractual Claim;

(2)  the plaintiff would give an undertaking not to bring the Contractual Claim against the defendant in any other jurisdiction.

23.In other words, if the plaintiff is allowed to proceed with the Cheque Claim in Hong Kong, it would abandon its right to sue the defendant on the Contractual Claim.  The defendant would therefore not be vexed twice.

D.   LEGAL PRINCIPLES

24.It is trite that an applicant for ex parte relief is under a stringent duty to give full and frank disclosure to the court of all matters which are necessary for the proper disposal of the application.  Materiality is to be decided by the court and not by the assessment of the applicant or his legal advisors: Altrans Fast Cargo Limited & Another v Liu Yugang & Others [2023] HKCFI 1579 at [44].  

25.Further, a relevant matter must be disclosed even if the court’s decision may have been the same: Citibank N A v Express Ship Management Services Ltd & Another [1987] HKLR 1184 at 1190 (per Fuad JA).

26.In Excel Courage Holdings Limited & Another v Wong Sin Lai & Others [2014] 3 HKLRD 642 at [56], Kwan JA (as she then was) adopted the following “useful summary” of the main principles governing the re-grant of an interlocutory injunction which is discharged for material non-disclosure as compiled by Deputy Judge Alan Boyle QC in The Arena Corporation Ltd v Schroeder [2003] EWHC 1089 (Ch):

“(1) If the court finds that there have been breaches of the duty of full and fair disclosure on the ex parte application, the general rule is that it should discharge the order obtained in breach and refuse to renew the order until trial.

(2) Notwithstanding that general rule, the court has jurisdiction to continue or re-grant the order.

(3) That jurisdiction should be exercised sparingly, and should take account of the need to protect the administration of justice and uphold the public interest in requiring full and fair disclosure.

(4) The court should assess the degree and extent of the culpability with regard to non-disclosure. It is relevant that the breach was innocent, but there is no general rule that an innocent breach will not attract the sanction of discharge of the order. Equally, there is no general rule that a deliberate breach will attract that sanction.

(5) The court should assess the importance and significance to the outcome of the application for an injunction of the matters which were not disclosed to the court. In making this assessment, the fact that the judge might have made the order anyway is of little if any importance.

(6) The court can weigh the merits of the plaintiff’s claim, but should not conduct a simple balancing exercise in which the strength of the plaintiff’s case is allowed to undermine the policy objective of the principle.

(7) The application of the principle should not be carried to extreme lengths or be allowed to become the instrument of injustice.

(8) The jurisdiction is penal in nature and the court should therefore have regard to the proportionality between the punishment and the offence.

(9)  There are no hard and fast rules as to whether the discretion to continue or re-grant the order should be exercised, and the court should take into account all relevant circumstances.”

27.Having referred to the above principles, her Ladyship continued:

“57. There is a tension between two kinds of public interest in this situation (Sita UK Group Holdings Ltd & Anr v Serruys & Ors [2010] EWHC 698 (QB) at §[15]).  The first is that the court should take account of the need to protect the administration of justice and uphold the requirement of full and fair disclosure in an ex parte application.  So if material non-disclosure is established, the court will be astute to ensure that a plaintiff who obtains an ex parte injunction without full disclosure is deprived of any advantage he may have derived by that breach of duty, to bring home to litigants the serious consequences of non-disclosure.  This is what was described as ‘the golden rule’ in some cases.  The other public interest is the general duty to do justice so that the application of the golden rule must not be allowed to become the instrument of injustice in a particular case.  So the court would have regard to the principle of proportionality in the exercise of its penal jurisdiction to impose sanctions for non-disclosure.

58.  As Christopher Clarke J said in Re OJSC Ank Yugraneft [2009] 1 BCLC 298 at §[103], in exercising this discretion, the court, like Janus, looks both backwards and forwards.  The overriding question for the court is what is in the interests of justice in the particular circumstances of the case.”

28.While Excel Courage Holdings Limited concerned an interlocutory injunction rather than leave to serve outside the jurisdiction, Ms Lee for the plaintiff accepted that the relevant factors set out in [56] thereof as quoted above are applicable to the present case.  Be that as it may, it is noted that G Lam J (as G Lam JA then was) had the following to say in 張才奎所託管中國山水投資有限公司股份相關員工及另一人 v. 張才奎及另一人 (HCA 1661/2014, unreported, 13 May 2015) at [114]:

“In any event, in the context of an application for leave for service outside the jurisdiction, there is not the same concern that re-granting the application upon discharge on the ground of non-disclosure would effectively allow the applicant to retain the advantage obtained by the original order, as in the case of a Mareva injunction or Anton Piller order: Pacific Electric Wire & Cable Co Ltd v Texan Management Ltd [2007] 4 HKC 372 at §16 […]”

E.   DISCUSSION

29.I hold the view that the Ex Parte Orders, having been set-aside, should clearly not be re-granted.

30.Apart from the matters referred to by the learned Master (see [18] above), another factual point which the plaintiff failed to draw the Court’s attention when the Ex Parte Orders were sought was Clause 4 of the 2023 Agreement which provided that:

“This application, the Facility, any transaction, any security granted by the Applicant, including any cheque or promissory note (‘Livrança’) or any other form of acceptable negotiable instrument, and each marker connected with the Facility are governed by the laws of the Macau SAR.”

(emphasis added)

31.This point on the governing law of the ICBC Cheque was first raised by the defendant in his 3^rd Affirmation which was filed in opposition to the plaintiff’s application for summary judgment (the unnotarised version thereof was served together with the 3^rd Affirmation of Li Jian Kun filed on 19 December 2024).  The point was repeated in the defendant’s 4^th Affirmation which was filed in support of his application to set aside the service of the Writ.

32.However, surprisingly, the plaintiff did not refer to the said Clause when the Ex Parte Orders were sought.  As far as the governing law of the ICBC Cheque is concerned, in paragraph 15 of the Affirmation of Chan Felicia Chloe filed on 26 March 2025, it was only stated that:

“[…]

(c) The proper law of the contract (i.e. the Cheque) is Hong Kong law as the Cheque is drawn upon the Defendant’s bank account held with ICBC in Hong Kong and the Cheque is payable in Hong Kong, so the transaction is governed by the provisions in the Bills of Exchange Ordinance (Cap.19) (the ‘Ordinance’).

[…]”

33.Ms Lee for the plaintiff accepted that “there may be arguments that the cheque may be governed by Macau law”[1].  As such, the said Clause 4 should have been mentioned when the plaintiff applied for the Service Out Order, despite the fact that it may be arguable that section 72 of the Bills of Exchange Ordinance (Cap.19, Laws of Hong Kong) may be applicable.  In my view, the said Clause 4 is a material matter which had not been but should have been disclosed.

34.Another matter which the plaintiff failed to mention but should have been mentioned when the ex parte applications were made relates to the witnesses to be called at the trial.  In the Affirmation of Chan Felicia Chloe which was filed in support of the application for the Service Out Order, it was stated that:

“15. I verily believe that Hong Kong is the appropriate forum for the trial of this action and leave should be granted under Order 11 rule 1 for the following reasons:

(a) This action is based on the non-payment of the Cheque, which is drawn on the Defendant’s account in Hong Kong held with ICBC.  Therefore, any documents required from ICBC concerning the Defendant’s account held with ICBC are located in Hong Kong.  Further, relevant bank staff who handled the presentation for payment and clearance of the Cheque are in Hong Kong.  If required, the relevant staff would not have to travel abroad to give evidence if the trial of this action takes place in Hong Kong.

[…]”

35.It is puzzling as to why the plaintiff’s solicitor considered it relevant to talk about the location of the ICBC bank staff member, as it was not explained why she took the view that bank staff members would be required to give evidence for the Cheque Claim.  But what is more troubling is that the solicitor did not inform the Court that, according to the defendant’s case which had been disclosed in his 3^rd and 4^th Affirmations, a very important witness in the present case is Ms Joyce Xu to whom the defendant had allegedly informed in 2020 that the ICBC Account had been closed by ICBC and that Ms Xu did not live in Hong Kong.

36.It is noted that, in the defendant’s 5^th Affirmation filed in support of the application to set aside the Ex Parte Orders, he had expressly challenged that the plaintiff’s material non-disclosure was intentional.  This is no doubt a very serious allegation, particularly when the affirmations filed in support of the application for the Ex Parte Orders were all made by solicitors.  However, in the opposing affirmation made by Ms Vivian Yuen (her 2^nd Affirmation), the aforesaid very serious allegation was not denied at all.  Neither was there any explanation as to why the aforesaid material matters were not voluntarily disclosed to the Court in the first place when the Ex Parte Orders were applied for. 

37.Indeed, while the plaintiff was all along represented by the same firm of solicitors, neither Ms Man Michelle Chor Lam (who had sworn 3 affidavits in support of the applications for the Ex Parte Orders and in answer to the requisitions raised by the Court) nor Ms Chan Felicia Chloe made any further affirmation in response to the defendant’s serious allegations.

38.I have not lost sight of the “disclaimer” contained in paragraph 3 of Ms Vivian Yuen’s 2^nd Affirmation that:

“[…] For the avoidance of doubt, any matters that are raised in [the defendant’s 5^th Affirmation] but not addressed here shall not be taken to have been admitted or accepted by me and/or the plaintiff […]”

39.However, with greatest respect to the draftsman of this document, such a “disclaimer” is useless, for it does not change the fact that certain matters raised by the defendant are entirely not responded to.  Insofar as those matters are relevant to the issue before the Court (such as the allegation that the non-disclosure was intentional), the fact that they are left unanswered must of course have bearing on the outcome of the case, whether with or without the “disclaimer”. 

40.In the present case, when the plaintiff has kept completely silent in respect of the defendant’s allegation of intentional non-disclosure, and in the circumstances where the matters concerned had been expressly raised by the defendant in earlier applications, it is really not up to the plaintiff’s counsel to submit that the non-disclosure was not “deliberate in the sense of being made in bad faith, or with a view to deceiving or misleading the Court”[2], for this submission is totally unsupported by evidence.  In my view, the degree and extent of the culpability with regards to the non-disclosure must be regarded as very high in the circumstances of the present case.

41.Further, when the plaintiff was not even able to explain why the material non-disclosure took place, it must be even more rare that the Court would agree to re-grant the ex parte orders which have been set aside, for it would be quite contrary to the objective to protect the administration of justice and uphold the public interest in requiring full and fair disclosure.  Quite a wrong message would be sent to the society if the Ex Parte Orders are re-granted in such circumstances. 

42.As Kwan J (as Kwan VP then was) stated in Securities and Futures Commission v “A” (HCMP 1407/2007, unreported, 29 November 2007):

“41. The answer to the question whether the non-disclosure was innocent, in the sense that the fact was not known to the applicant or its relevance was not perceived, is an important consideration whether the ex parte order should be discharged, although it is not decisive (Brink’s Mat Ltd v Elcombe & Ors [1988] 1 WLR 1350 at 1357D, per Ralph Gibson LJ). […]”

43.Given the penal nature of the jurisdiction, the court should also have regard to the proportionality between the punishment and offence.  On this matter, since I take the view that the degree and extent of the culpability is very high, I have come to the conclusion that the “no re-grant” decision is proportionate, particularly when there is no prohibition against the plaintiff from pursuing the same causes of action in Macau.

44.In the course of her argument, Ms Lee for the plaintiff also invited this Court to give considerable weight to the reasoning in support of re-grant given by the learned Master despite counsel’s recognition that the present appeal is conducted by way of rehearing. 

45.While it is strictly speaking unnecessary to do so, I would briefly explain why I do not agree with the view of the learned Master on a number of factors which affected the Master’s exercise of discretion.

46.First, the learned Master took the preliminary view, based on the materials placed before the Court, that the defendant’s defence was not “particularly compelling”, and in particular, he highlighted the fact that there are unexplained features and inconsistencies in the defendant’s factual account of how the alleged understanding in respect of the “cheque” came about.  I believe the learned Master was referring to the BOC Cheque, in respect of which the defendant had indeed given slightly different account as to the circumstances under which it was given to the plaintiff.  However, with respect, as far as the Cheque Claim is concerned, the focus should be on the ICBC Cheque.  In this regard, it should not be forgotten that there is a letter produced by the defendant which shows that it was indeed ICBC which closed his ICBC Account in around December 2020.  The remaining key factual issue which the Court has to resolve is whether the defendant had indeed informed Ms Joyce Xu in December 2020 about such closure.  On this matter, curiously, the defendant’s evidence that she had so informed Ms Joyce Xu is not directly contradicted by the plaintiff:

(1)  Ms Joyce Xu did not make any affirmation at all;

(2)  Although Ms Vivian Yuen stated in her affirmation that “The Defendant never mentioned to me/the Plaintiff that the ICBC Cheque could no longer be presented for payment”[3], she did not explain the basis for saying that “the plaintiff” had never been told about the problem with the ICBC Cheque, and more importantly, she did not say that she had asked Ms Joyce Xu about it.

47.I can of course see that Ms Vivian Yuen had been talking about the usual practice of the plaintiff, and that she had emphasised that the plaintiff would not do anything which would be against its commercial interest (for example, not insisting to have a replacement security cheque), however, what is equally true is that the instant messages record between the defendant and Ms Yuen shows, not surprisingly, that she (presumably with the plaintiff’s authority) had been quite tolerant with the defendant.

48.Hence, I do not think the defendant’s case was as weak as the learned Master thought.

49.Secondly, the learned Master was not satisfied that the non-disclosure was deliberate in the sense that it was done with the intent to deceive or mislead the court.  He took the view that cogent evidence is required before the Court could come to this conclusion.  However, the learned Master had failed to appreciate the difficulty to produce evidence of such a nature as explained by Kwan J in SFC v “A” (supra) at [41]:

“[…] In practice it would be extremely difficult for a defendant applying for discharge to show that the matters which were not disclosed were the subject of a decision not to disclose made in circumstances where it was appreciated there should have been disclosure.  In the majority of cases, the matter has to be approached on the basis of considering the quality of the material which was not disclosed without making any final decision whether or not there has been bad faith in the failure to disclose (Behbehani v Salem [1989] 2 All ER 143 at 149a to b, per Woolf LJ).”

50.As discussed, in the peculiar circumstances of the present case, where the material matters had been specifically relied on by the defendant, but yet the plaintiff failed to refer to them when the ex parte applications were made, and then the plaintiff did not give any explanation as to why it had omitted to do so, there is simply no room for the Court to treat it as if the non-disclosure was anything other than deliberate.

51.Thirdly, the learned Master took the view that the material non-disclosure largely concerned the 2023 Agreement.  With respect, he might have overlooked the non-disclosure of those matters which were referred to in [30] and [35] above.

52.Fourthly, the learned Master came to the conclusion that, as far as the Cheque Claim is concerned, Hong Kong is clearly the appropriate forum.  With respect, I disagree.  The only connection of this claim to Hong Kong is that the ICBC Cheque was drawn on a bank in Hong Kong.  However, all other relevant factors would point to the courts in Macau.  For example, the key witnesses, namely, Ms Yuen and Ms Xu, are both living and working in Macau, and the ICBC Cheque is arguably governed by the law of Macau pursuant to Clause 4 of the 2023 Agreement. 

53.Further, one must not forget that originally the plaintiff had also made the Contractual Claim against the defendant.  There is now a consensus that the Contractual Claim should not be tried in Hong Kong.  While the Cheque Claim is a claim independent to the Contractual Claim, these claims are related, and have been pleaded as alternative claims.  Viewed in such light, in the interest of justice, one may wonder why the Cheque Claim should be litigated in Hong Kong while the Contractual Claim be permanently stayed (with an undertaking given by the plaintiff that it would not pursue it again elsewhere).  Why shouldn’t both claims be commenced and tried in Macau?

54.For the above reasons, I have come to the conclusion that there should not be a re-grant of the Ex Parte Orders.

F.   DISPOSITION

55.I therefore make the following orders:

(1)  The defendant’s appeal be allowed;

(2)  The learned Master’s order dated 11 March 2026 to re-grant the Ex Parte Orders be set aside;

(3)  A declaration that any and all such service of the Concurrent Amended Writ of Summons filed on 23 May 2025 was invalid and the same be set aside;

(4)  A declaration that the Court does not have and should not have exercised jurisdiction over the defendant in respect of the subject matters of these proceedings and that the same be stayed in favour of the Courts of the Macau Special Administrative Region;

(5)  The learned Master’s costs order made on 11 March 2026 be set aside.

G.   COSTS

56.There was no dispute that costs should follow the event.  Therefore, I order that the plaintiff shall bear the defendant’s costs of the appeal, the hearing below and of the Summons.

57.The defendant’s costs shall be summarily assessed in lieu of taxation.  For the above purpose, the defendant shall lodge and serve his statement of costs on or before 30 October 2026.  The plaintiff shall lodge and serve its statement of objection on or before 6 November 2026.  Summary assessment will be conducted on paper (no matter whether any statement of objection is lodged by the plaintiff within time) thereafter.  The costs assessed shall be paid by the plaintiff within 14 days after assessment.

Ms Rosa Lee, instructed by Johnson Stokes & Master, for the plaintiff

Mr Thomas Wong and Mr Ian Yu, instructed by Han Kun Law Offices LLP, for the defendant