Force Field Ltd v. Top One Global Holdings Ltd and Another

On 30 September 2026, Deputy High Court Judge Andrew Li handed down judgment in _Force Field Limited v Top One Global Holdings Ltd & Anor_ and the related _Top One Global Holdings Ltd v Su Da & Anor_ [2026] HKCFI 5340, two actions heard together arising from the 2016 sale of 19.8% of Ernest Borel Holdings Limited (Stock Code: 1856) for HK$154.8 million. Mr Vincent Lung, instructed by Lennon & Lawyers, acted for Force Field and Su Da.

The 2980 Action turned on whether Top One was bound by an oral collateral promise, allegedly made by its director Sit at the signing of the SPA, to take up the 3.26 million EBHL shares carved out of the original block at the last minute. The 406 Action was Top One's warranty claim against Su and FF for alleged misstatements in the Management Accounts.

The Court held that: (1) Top One was Hon's nominee throughout the acquisition, with adverse inferences drawn against it for failing to call Sit, Hon and other Citychamp personnel; (2) the Collateral Agreement existed and was not negated by the Entire Agreement Clause, applying _MWB Business Exchange Centres Ltd v Rock Advertising Ltd_ [2019] AC 119, since the carve-out was a separate subject matter supported by its own consideration (§§105-106); (3) FF won on liability in the 2980 Action but failed to mitigate its loss by not selling the remaining shares when the price was above HK$2.25, so no damages were awarded; (4) in the 406 Action, Top One failed on Cancelled Sales, Unrecoverable Receivables, Advertisement Fees and Missing Inventories, but succeeded on the Easy Team Liabilities and Ms Liu's Salary Payments; (5) Clause 5.7 of the SPA, when read with Clause 5.8, was a penalty clause under _Law Ting Pong Secondary School v Chen Wai Wah_ [2021] 3 HKLRD 185 and could not be used to claim the NAV shortfall; (6) damages were assessed at 19.8% of the two successful heads, totalling HK$1,982,563.

Why it matters for practitioners

Two points stand out. First, a last-minute carve-out in an SPA can support an enforceable collateral agreement where the carve-out is itself a separate bargain supported by consideration, even where the SPA contains an entire agreement clause. Second, Clause 5.7-style "every dollar" indemnity clauses in share purchase agreements are now squarely in the penalty zone where the indemnity bears no relationship to the buyer's actual economic loss. Buyers drafting warranty packages should expect courts to scrutinise such clauses for proportionality, and sellers should consider challenging them at the pleading stage.