Insights

This edition of DCC Commercial Digest features a selection of significant judgments released in May 2026. Curated by Sabina Sui and Gabriel Ho, this issue highlights four noteworthy cases, each accompanied by a concise summary. Our aim is to provide valuable insights into recent legal developments and enhance understanding of critical issues in commercial law.

Summary of Cases
Case 1: Application to Stay Reciprocal Enforcement of PRC Judgment based on Retrial Application Refused 兴业银行股份有限公司宁波分行 v 宁波百丰选矿有限公司 [2026] HKCFI 2455

Date of Decision: 4 May 2026

Coram: DHCJ Jonathan Wong

The Court dismissed applications (1) to stay reciprocal enforcement proceedings pending a retrial application in the PRC, and (2) to set aside the registration of a PRC judgment on the grounds that enforcement would be contrary to public policy. A mere application for retrial without any order granting a retrial does not justify a stay or setting aside of registration, as this would undermine the MJREO’s legislative objective of simple and expeditious enforcement of PRC judgments.

Case 2: “All” means all: Former Liquidators held in Contempt for Failing to Produce All Documents Belonging to a Company Luen Tat Watch Band Manufacturer Limited v Stephen Liu Yiu Keung [2026] HKCFI 2564

Date of Decision: 7 May 2026

Coram: Winnie Tsui J

The former liquidators of a company were held in contempt of court for failing to comply with an order to produce all documents belonging to the company. Their contention that it was impossible to review the voluminous documents was rejected, as it was incumbent on the liquidator to devise a suitable methodology for conducting document review. However, the Court also found on the evidence that the contempt was purged by the Defendants’ subsequent production and exercised its discretion to make no order on the committal application.

Case 3: Framework for challenging emergency arbitration relief enforcement orders W v GH [2026] HKCFI 2966

Date of Judgment: 21 May 2026

Coram: Hon Mimmie Chan J

This decision clarifies that the grounds available for challenging or setting aside a court order enforcing emergency relief under section 22B of the Arbitration Ordinance (Cap 609) are confined to the four corners of that section. Further, a party seeking to resist enforcement of emergency relief by challenging the existence of the arbitration agreement faces a high bar. The Court will only intervene where the absence of a valid arbitration agreement is beyond question.

Case 4: No derivative action in liquidation: the Court of Appeal reaffirms the primacy of the insolvency regime Chu Kong v Lau Wing Yan and Others [2026] HKCA 1004

Date of Judgment: 29 May 2026

Coram: Hon Kwan VP, Chu VP and Cheng J

The Court of Appeal affirmed the principle that a derivative action is not available where a company is in liquidation. Once a company enters liquidation, its court-supervised liquidator displaces the shareholders as the proper party to pursue corporate wrongs. A contributory’s remedies lie within the insolvency framework, not in a parallel derivative action. In the cross-border context, this principle may apply to direct the aggrieved parties to seek relevant directions from the appointing court.

Disclaimer: These articles do not constitute legal advice and seek to set out the general principles of the law. Detailed advice should therefore be sought from a legal professional relating to the individual merits and facts of a particular case. The photographs included in this document are for decorative purposes only and should not be taken as a depiction of any matter related to the cases summarised. The views and opinions expressed in these articles are solely those of the members authoring them and do not necessarily reflect the official policy or position of Denis Chang’s Chambers, or of any other member or members of Denis Chang’s Chambers.