HCCW386/2025 RE LONG ENGINEERING MANAGEMENT LTD - LawHero
HCCW386/2025
高等法院（公司清盤）Deputy High Court Judge Le Pichon4/2/2026[2026] HKCFI 834
HCCW386/2025
A A
HCCW 386/2025
B [2026] HKCFI 834 B
C IN THE HIGH COURT OF THE C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D D
COURT OF FIRST INSTANCE
COMPANIES (WINDING-UP) NO 386 OF 2025
E E
_______________________
F F
IN THE MATTER of the Companies
G
(Winding Up and Miscellaneous G
Provisions) Ordinance, Cap.32
H and H
IN THE MATTER of LONG
I ENGINEERING MANAGEMENT I
LIMITED (信豐工程管理有限公司)
J _________________________ J
K Before: Deputy High Court Judge Le Pichon in Court K
Date of Hearing: 29 January 2026
L L
Date of Judgment: 5 February 2026
M M
JUDGMENT
N N
O O
1. Dixie Engineering Company Limited (the “Petitioner”)
P presented a petition on 26 June 2025 to wind up Long Engineering P
Management Limited (the “Company”) based on the Company’s failure to
Q Q
pay the Petitioner the amount of HK $917,066.83 (the “Debt”) it demanded
R in a statutory demand (“SD”) issued to the Company on 3 June 2025. At R
the conclusion of the hearing judgment was reserved which I now give.
S S
T T
U U
V V
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A A
Background facts
B B
C 2. On 24 June 2020, the Highways Department of the HKSAR C
Government (the “Highways Department”) awarded the Main Contract of
D D
its construction project of Contract No. HY/2019/21 (the “Project”) to the
E Petitioner. E
F F
3. The Petitioner entered into a written subcontract agreement
G on 16 September 2020 with Long Engineering Limited (“LEL”) G
subcontracting the works under the Main Contract to LEL (the “Sub-
H H
Contract Works”).
I I
4. LEL sub-contracted part of the Sub-Contract Works to the
J J
Company (the “Sub-subcontract”), primarily for the provision of labourers
K (the “Sub-subcontract Works”). The work site of the Project was in Tuen K
Mun (the “Work Site”).
L L
M 5. On 15 January 2025, the Petitioner wrote to LEL, alleging that M
LEL had failed to attend to the Work Site and to proceed with the Sub-
N N
Contract Works which LEL disputes. The Petitioner does not have any
O contractual relationship with the Company (being a lower tier sub-sub- O
contractor) or its employees.
P P
Q 6. On 17 January 2025, the Petitioner terminated its Sub- Q
Contract with LEL. It evicted LEL and then denied entry to the Company
R R
and their staff to the Work Site and removed their belongings and assets
S therefrom without consent. S
T T
U U
V V
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A A
7. The SD issued on 3 June 2025 was in respect of the Debt
B B
which is said to arise solely from payments made by the Petitioner of
C outstanding wages owed by the Company to 281 of its employees who C
worked on the Project (the “Employees”) pursuant to section 43C of the
D D
Employment Ordinance, Cap 57 (“EO”).
E E
8. While letters from the Petitioner’s solicitors (“NWK”) dated
F F
9 and 17 June 2025 informed the Company of the SD having been ‘served’
G pursuant to section 178 (1) (a) of the Companies (Winding Up and G
Miscellaneous Provisions) Ordinance Cap 32, those letters did not enclose
H H
a copy of the SD despite the Company’s request. The Company only
I obtained a copy of the same by collecting it from NWK’s office. I
J J
9. The Company’s solicitors (“Chin”) responded by their letter
K dated 23 June 2025 specifically disputing the Petitioner’s entitlement to the K
Debt on various grounds, including the following:
L L
M • the Petitioner’s termination of LEL’s Sub-Contract was M
unlawful and invalid;
N N
O • it constructively terminated the Company’s Sub-subcontract, O
compromising the Company’ ability to comply with its duties
P P
under the EO (to provide work and place of work for its
Q employees); Q
R R
• such conduct caused a multitude of legal proceedings between
S the Company and its employees and gave rise to costs the S
T 1 T
Attached to the SD are "Particulars of Debts owed by the Company to the Petitioner" (the "List")
with 28 entries relating to payments made to the persons set out in the List. Although 2 of the entries
bear identical names (both in Chinese and English), the Company took no issue with the Petitioner's
U statement that they are two different persons. U
V V
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A A
Company had to incur and in respect of which it would seek
B B
to recover as damages; and
C C
• the Company disagreed with the amounts of ‘wages’ paid by
D D
the Petitioner to the employees whose entitlement to the same
E is disputed. E
F F
10. The Company claimed that the Petitioner had solicited and
G induced its employees to breach their employment contracts and work for G
the Petitioner directly.
H H
I 11. The Petitioner did not respond to the Company’s invitation to I
withdraw the SD. Instead, it presented the Petition 3 days later.
J J
K The Petition K
L L
12. The Petition is a four-page document which did not address
M any of the points raised in Chin’s letter disputing the Debt. It never attempt M
to communicate with the Company its reasons for disputing the amounts
N N
of wages paid to the employees.
O O
13. The sole legal basis of the Petitioner’s claim to be entitled to
P P
be paid the Debt is pursuant to section 43F (1) of the EO which provides
Q that if a principal contractor pays to an employee any wages under section Q
43C, the wages so paid shall be a debt by the employer of that employee to
R R
the principal contractor.
S S
14. Section 43C deals, inter alia, with the joint and several
T T
liability of a principal contractor and superior sub-contractor to pay the
U wages of employees of sub-contractors. In the present case, the Petitioner U
V V
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A A
is the principal contractor, LEL is a superior sub-contractor and the
B B
Company is a sub-sub-contractor for the Project.
C C
Whether the Company has raised a bona fide defence
D D
E 15. The key issue is whether the Company is able to demonstrate E
that it has a bona fide defence to the Petitioner’s claim for payment of the
F F
Debt.
G G
16. The Company contends that the Petitioner’s payments to the
H H
Employees are not payments pursuant to section 43C2.
I I
17. For present purposes, the 4 subsections of section 43C may be
J J
summarised as follows:
K K
L L
2
In pertinent part, section 43C provides as follows:
Sub-contractor’s employees’ wages
M 43C. Liability of principal contractor and superior sub-contractor to pay wages of employees M
of sub-contractors
(1) Subject to this Part, if any wages become due to an employee who is employed by a sub-
N contractor on any work which the sub-contractor has contracted to perform, and such N
wages are not paid within the period specified in section 23, 24 or 25, as the case may be,
such wages shall be payable to the employee—
O (a) where the sub-contractor has contracted with the principal contractor, by the principal O
contractor; and
(b) where the sub-contractor has contracted with a superior sub-contractor, by the principal
P contractor and every superior sub-contractor to the sub-contractor, jointly and P
severally.
(2) The liability of a principal contractor and of a principal contractor and superior sub-
Q contractor or superior sub-contractors jointly and severally under subsection (1) shall be Q
limited—
(a) to the wages of an employee whose employment relates wholly to the work which the
R principal contractor has contracted to perform and whose place of employment is R
wholly on the site of the building works; and
(b) …
S (3) Subject to subsection (4) the wages payable under subsection (1) shall be paid by the S
principal contractor or superior sub-contractor, as the case may be, not later than 30 days
after the date on which a notice under section 43D is received by him or service thereof is
deemed to be effected on him.
T T
(4) Where any claim in respect of the wages payable under subsection (1) is filed with the …
Labour Tribunal and an award or order is made in favour of the employee, the wages shall
be paid within such time as the … Labour Tribunal may direct, or, in the absence of any
U direction, not later than 30 days after the making of the award or order.” U
V V
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A A
(1) if any wages become due to an employee employed by a sub-
B B
contractor to perform on any work the sub-contractor has
C contracted to perform and such wages are not paid within the C
period specified, the principal contractor and every superior
D D
sub-contractor are jointly and severally liable to the employee;
E E
(2) the joint and several liability of the principal contractor and
F F
superior sub-contractor are subject to specified limitations;
G G
(3) subject to (4) below, liability for the wages payable under
H H
subsection (1) does not arise unless a notice under section 43D
I is received by the principal contractor or superior sub- I
contractor; and
J J
K (4) where any claim in respect of wages payable under subsection K
(1) is filed with the Labour Tribunal and an award or order is
L L
made in favour of the employee, the wages shall be paid as
M directed and in the absence of any direction within 30 days of M
the making of the award or order.
N N
O 18. In connection with subsections (3) and (4) above, no liability O
arises unless there are valid section 43D notices or claims have been filed
P P
by some of the Employees with the Labour Tribunal and an award or order
Q is made in respect of each of those claims. In the present case, the Labour Q
Tribunal has not made any award or order in respect of any of the
R R
Employees.
S S
19. In the circumstances, the existence of valid section 43D
T T
notices is determinative. It is necessary to consider closely the provisions
U U
V V
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A A
of section 43D as to what would constitute a valid section 43D notice. Of
B B
critical importance are subsections (1) and (3):
C C
(a) subsection (1) sets out 5 categories3 of information required
D D
for a valid section 43D notice; and
E E
(b) subsection (3) states that no liability to pay any wages under
F F
section 43C to the employee of the subcontractor can arise if
G that employee fails to serve a notice on the principal G
contractor under subsection (1).
H H
I 20. It was not until the Petitioner filed the affirmation of Raymond I
Cheng (“Mr Cheng”) on 29 August 2025 (“Cheng 1st”) in reply to the
J J
affirmation of Chan Chi Man (“Mr Chan”) dated 8 August 2025 (the “Chan
K 1st”) that the Petitioner disclosed documents 4 said to support the wage K
claims.
L L
M 21. Mr Cheng dealt with the Employees’ claims on behalf of the M
Petitioner. In §6 of his affirmation (filed in reply to Chan 1st), he describes
N N
the batch of documents in CR 1 as follows:
O O
“Each of the Employees had either issued a notice of claim to the Petitioner
under section 43D of the Employment Ordinance or lodged a claim in the
P P
Labour Tribunal against the Company as direct employer and the
Petitioner as the main contractor of the Project. The Petitioner does not
Q have a complete set of the claim forms lodged by the Employees in its Q
possession but only have those provided by the Labour Tribunal.”
(Emphasis added)
R R
S S
3
They are: (a) name and address of the employee; (b) name and address of his employer; (c) address
T T
of the place of employment of the employee; (d) particulars of the work in respect of which the wages
are due; and (e) amount of wages due and the period to which they relate.
4
Exhibit CR 1. The 1st page is a "Request for advancing of wages". The remaining documents are
U claims by some of the Employees lodged with the Labour Tribunal. U
V V
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A A
22. The 1st page of CR 1 is an undated “Request for Advancing of
B B
Wages” (the “Request”) made by 11 individuals itemising outstanding
C wages for the month of December 2025. However, those individuals claim C
to be employed by LEL rather than the Company. In any event, only 4 of
D D
those names match the names of the Employees named in the “List5”.
E E
23. The remaining documents in CR 1 (the “remaining
F F
documents”) relate to claims made by 23 individuals, seemingly in the
G Labour Tribunal (the entity identified in Cheng 1st as the recipient of the G
claims lodged). As Mr Cheng acknowledged, the Petitioner does not have
H H
a complete set of the claim forms lodged by the Employees. CR 1 consists
I of documents said to be provided to the Petitioner by the Labour Tribunal. I
J J
24. The Company contends that the documents disclosed by the
K Petitioner do not constitute valid section 43D notices. In Wing Lee K
Engineering & Technical Services Ltd v Alliance Building Services
L L
Engineering Limited, CACV 275/2006, unrep., 27 April 2007, the Court of
M Appeal held (at §§33-38) that section 43F of the EO is not engaged if no M
section 43D notices have been served on the principal contractor, even if
N N
payment was made by it to an employee of the subcontract.
O O
25. It was only at the hearing that Mr Vincent Li, counsel for the
P P
Petitioner made submissions concerning the remaining documents but did
Q not address the points raised in §22 above concerning the Request. Q
R R
26. The Court was taken to the agreed translation 6 of a
S representative sample of Part II of Labour Department Form 136 (a) (the S
“LD Form”). The representative sample relates to a claim made by Chan
T T
5
See footnote 1 above.
U 6
B/9a/134. U
V V
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A A
Ka Fai7 (“Claimant Chan”). His LD Form, in pertinent part, is reproduced
B B
below:
C C
“ LRD Ref. No.:________
Part II
D D
Important Notice/Disclaimer:
E The Labour Department does not represent or endorse the accuracy or reliability of E
any of the information or content of the claim stated below. … produced by …
claimant alone … need to be verified or clarified during the conciliation meeting
F where both parties could produce further evidence (e.g. employment records) for F
the said purposes.
G G
In order to facilitate conciliation, a copy of this page will be provided to the party
being claimed against for reference before the party being claimed against.
H H
Name of Claimant: Chan Ka Fai (in block letters) Signature of Claimant: (signed)
I I wish to claim the following: Amount I
Wages: (from 2 December 2024 to 31December 2024) $25850
…
J Overtime pay: (from 4 December 2024 to 31 December 2024) $1098 J
…
K Total amount : $26948 K
…
L L
…
LD 136(a) (Rev. 2023)”
M M
27. Mr Li referred to the prefix “LRD” to the reference number
N N
appearing at the top right-hand corner and the last line of the LD Form,
O submitting that they show that the LD Form emanates from the Labour O
Department. The 1st paragraph states that the amount claimed was to be
P P
verified or clarified at the conciliation meeting at which both parties
Q (Claimant Chan and the unidentified person(s) against whom the claim is Q
made) would have the opportunity to produce further evidence.
R R
S S
T T
7
Claimant Chan is the 2nd name on the List.
U U
V V
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A A
28. The List shows that the Petitioner paid the amount (shown in
B B
the form exhibited) claimed by Claimant Chan on 17 January 2025. Mr Li
C submitted that the payment was the result of the conciliation meeting C
concerning Claimant Chan’s claim. Cheng 1st (at §8) reads as follows:
D D
“I attended various conciliation meetings which were arranged by the
E E
Labour Department for resolution of the Employees’ wage claims, as well
as hearings in the Labour Tribunal, as the Petitioner’s representative. The
F Company was represented by one Ms Mandy Chow [(“Ms Chow”)] in F
most of these meetings/hearings. In all of the meetings/hearings which I
attended, [Mr Chan] was not there. The stance taken by [Ms Chow] in
G these meetings/hearings was that the Company would not dispute the G
outstanding wages, but she had no instruction from the Company to make
any payment.”
H H
I I
29. The approach taken by the Petitioner is that:
J J
(i) all the payments made by the Petitioner and set out in the List
K K
are based on the outcome of various conciliation
L
meetings/Labour Tribunal hearings; L
M (ii) the Company was represented by Ms Chow at most of the M
meetings/hearings which Mr Cheng attended and Ms Chow
N N
did not dispute the outstanding wages claimed; and
O O
(iii) the LD Form coupled with declarations exhibited in the CR 2
P P
(considered in §32 below) operate as ‘deemed’ notices for the
Q Q
purposes of section 43C (3).
R R
30. Pausing there, the schedule attached to LEL’s letter to HD
S dated 5 February 20258 upon which Mr Li relies lists Ms Chow as one of S
LEL’s employees and not the Company’s. Mr Joey Chan, counsel for the
T T
U 8
See the table in [40] below. U
V V
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A A
Company informed the Court that he has instructions that Ms Chow an
B B
LEL employee represented LEL and not the Company at some of the
C conciliation meetings. It would appear that the Petitioner relies on Cheng C
1st at §89 for his submission that Ms Chow was representing the Company
D D
and nothing more.
E E
31. Apart from being ambiguous, the passage from Cheng 1st
F F
(cited in §28 above) is deficient in many respects. To mention the most
G obvious (but by no means exhaustive) matters: G
H H
(i) Mr Cheng does not list the dates of hearings he attended nor
I the claim(s) that those hearings concerned. In other words, the I
hearings were unparticularised in many respects.
J J
K (ii) In Claimant Chan’s case, 3 payments were made to him on K
different dates. The LD Form exhibited relates to the 1st
L L
payment. There is no explanation concerning the other
M payments and why the Petitioner paid them. M
N N
(iii) No recipient is identified on the LD Form. The employee may
O claim against any one or more of the parties liable under the O
EO to pay his wages. Thus, they include the Petitioner, LEL
P P
and the Company.
Q Q
(iv) As the Petitioner admits, CR 1 is incomplete 10 . It is not
R R
understood why that should be so. Presumably, the Petitioner
S received a notice/request to attend the conciliation meetings. S
If so, there must have been some written communication from
T T
9
Cited in §28 above.
U 10
None of the remaining documents even bear an LRD reference number. U
V V
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A A
the Labour Department. Moreover, it sheds no light on
B B
whether the Petitioner made any request for the full set of
C documents from the Labour Department. C
D D
(v) Conciliation meetings are not the same as Labour Tribunal
E hearings. E
F F
(vi) What constitutes an “outcome” of a conciliation meeting is
G not explained nor its legal effect (if any), nor the relationship G
(if any) between conciliation meetings and Labour Tribunal
H H
proceedings.
I I
(vii) What is very clear from the evidence is that no Labour
J J
Tribunal award or order has ever been made in respect of the
K Employees. K
L L
32. CR 2 consists, inter alia, of declarations signed by 12 of the
M 28 Employees. CR 1 and CR 2 together do not constitute valid section 43D M
notices as they do not comply with the requirements for a valid section 43D
N N
notice. The declarations in CR 2 appear to record private settlement
O arrangements with the Petitioner, with each of the 12 confirming that he O
would not pursue claims against the Petitioner regarding wage liabilities
P P
owed by the Employee’s employer.
Q Q
33. Valid section 43D notices require that they be in writing,
R R
stating 5 categories of information including the address of the place of
S employment of the employee. This information may be important because S
under section 43C (2) the liability of the principal contractor to pay wages
T T
jointly and separately applies to subparagraph (a) only. If the staff
U U
V V
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A A
concerned is an office worker who is not working at the Work Site, the
B B
Company will know that section 43C does not apply to that employee.
C C
34. Apart from the above, the Company takes issue with whether
D D
one of the 27 individuals “Cheung Yuen” [張源] named in the List was an
E employee of the Company11. There is no section 43D notice in relation to E
this individual upon which the Petitioner could rely. Instead, in §18 of his
F F
affirmation Mr Cheng states that he “personally handled the wage claim of
G [張源] but gives no explanation as to why he considered it appropriate to G
H
mark [張源] as an employee of the Company, rather than LEL, in his own H
record.
I I
J 35. As appears from the Company’s letter sent in response to the J
SD12 that preceded the presentation of the Petition, another core issue of
K K
dispute is whether the payments made by the Petitioner to the Employees
L can properly be characterised as a payment of wages made pursuant to L
section 43C.
M M
N 36. As elaborated in Chan 1st at §21, it is a standard term in the N
employment contracts of the Company to pay a daily rate to the Employees
O O
as an advance payment for setting off against statutory holidays and annual
P leave (the “Statutory Payments”) that the Employees may be entitled in the P
future. Section 43C is only engaged “if any wages become due to an
Q Q
employee who is employed by a sub-contractor and such wages are not
R paid within the period specified in section 23, 24 or 25 [of the EO]”. Thus, R
a statutory debt can only arise to the extent that there is a default in payment
S S
of wages under the EO. Payments made by the Petitioner above what the
T T
11
See §25 Chan Chi Man’s affirmation dated 8 August 2025.
U 12
See §9 above. U
V V
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A A
Company owes the Employees are not recoverable and advance payment
B B
and over-payment of wages are lawfully deductible from an employee’s
C wages. C
D D
37. It is clear from the employment contracts exhibited by the
E Company that the daily rate paid to the Employees that the advance E
payment is not a token amount but appears to be over 42% of the daily rate.
F F
In the circumstances, the Company is obviously entitled to question and
G challenge the amounts claimed by the Employees and paid by the Petitioner G
as unpaid wages without more.
H H
I 38. Having perused the documents in CR 1 and 2, I agree that I
even when read together they are not valid section 43D notices.
J J
K 39. Insofar as they are said to reflect claims lodged with the K
Labour Tribunal (which cannot be the case 13 ), they cannot assist the
L L
Petitioner since they are not “awards or orders” of the Labour Tribunal
M within section 43C (4). M
N N
40. I should mention that at the hearing the Petitioner’s opening
O submissions attached considerable significance to correspondence that O
took place between February and April 2025 summarised in the table below:
P P
Q Date Sender Recipient Q
05/02/2025 LEL HD 14
R 10/03/2025 LEL and the Company15 Engineer of the Project16 R
S S
13
See §23 above.
14
The letter was addressed to the Director of Highways.
T T
15
The signatories to the letter were LEL’s ex-Project Manager and the Company’s ex-Project Forman.
The letter was copied to a LegCo member, a member of the National People's Congress and the
Chairman of the Hong Kong Construction Industry Employees General Union.
U 16
Mannings (Asia) Consultants Limited. U
V V
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A A
13/03/2025 LEL Mannings
B 17/03/2025 Chin Ng Kwok Keung17 B
25/03/2025 LEL HD18
C C
15/04/2025 NWK19 Chin
D D
41. The thrust of the Petitioner’s submissions as regards the
E E
correspondence set out above is that it was meant to exert maximum
F pressure on the Petitioner to pay the wages of the Employees and to F
dissuade Employees from claiming against the Company even though the
G G
Company as employer had a non-delegable duty to pay wages to its
H Employees. But the letters did no more than point out to the Recipient(s) H
the Petitioner’s contractual obligations as the principal contract under the
I I
EO. The EO expressly provides for the employees’ entitlement to obtain
J information about the principal contractor for the purpose of exercising J
their rights.
K K
L 42. As regards the letters sent to HD, the Petitioner was not the L
intended recipient of any of those letters. They were written by LEL who
M M
complains that the Petitioner’s failure to pay Sub-contract payments to LEL
N gave rise to financial difficulty for LEL to pay the employees. Its claims N
against the Petitioner is being litigated in other proceedings.
O O
P 43. In short, little assistance can be derived from those letters. P
Q Q
44. Finally, I turn to Mr Li’s reliance on the ‘deeming’ provision
R in section 43C (3). His submission is entirely misplaced. Properly read, the R
word ‘deem’ refers to service and not ‘notice’. The EO does not contain
S S
T 17 T
He is one of the claimants.
18
Copies were sent to the parties copied on the letter of 10/03/2025: see footnote 14 above.
19
NWK represents 4 of the ex-employees in claim made to the Labour Tribunal, and this letter was
U sent in reply to the 17/03/2025 letter. U
V V
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A A
any mechanism to replace a notice in writing by oral discussions or some
B B
other informal matters.
C C
Conclusion
D D
E 45. I have no hesitation in concluding that the Company has E
demonstrated that it has a bona fide defence to the Debt. It has shown a
F F
strong case that there are no valid section 43D notices to support the Debt,
G such that the Petitioner cannot rely on section 43F (1). G
H H
46. Further, in the 23 June letter, the Company outlined its case
I against the Petitioner for wrongful inducement of breach of contract on the I
part of employees. The timing and rapid development of the events in a
J J
short time in mid-January supports the Company’s contention that the
K termination and the eviction had long been planned by the Petitioner and K
well in advance of its abrupt termination of LEL’s Sub-contract in mid-
L L
January. The List shows that 9 of the Company’s employees who became
M employed by the Petitioner started receiving their 1st payment from M
Petitioner between 13 and 17 January 2025. LEL’s contract was only
N N
terminated on 17 January 2025. This state of affairs cries out for an
O explanation and that is properly a matter for discovery which will only take O
place if there is a trial.
P P
Q 47. If the poaching of employees did occur, one direct loss from Q
the tort is the outstanding payment in lieu of notice from the employees
R R
and could well have resulted in the Company’s economic loss from the
S termination of the Sub-contract and eviction from the Work Site. S
T T
U U
V V
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A A
Petitioner's obligation to provide sufficient information on the facts relied
B B
upon in its Petition
C C
48. Mr Joey Chan referred to Re China Oceanwide Group Limited
D D
[2023] HKCFI 455 where (at §§20-32) Linda Chan J considered the
E requirement in some detail. Of particular relevance are §§28 and 30: E
F “28. It seems to me that the requirement discussed in In re Fildes Bros. Ltd F
apply equally, if not with greater force, to a petition presented by a creditor
on insolvency ground. Unlike a ‘just and equitable’ petition which is
G G
determined after a trial with the benefit of pleadings, list of documents and
witness statements filed by the parties, a petition presented by a creditor is
H almost invariably determined by the court summarily, without any H
pleadings, discovery or witness statements. It is all the more important for
the court to insist that a petitioner must set out its case and the facts relied
I upon in the petition so that the company would know what case it has to I
meet at the hearing. Indeed, it is necessary for the court to insist on such
requirement as otherwise the company and the court would have to trawl
J through the affirmations and the exhibits filed by the parties, which are J
often voluminous as the affirmants (and those advising the parties) seems
to think that they can raise any facts and exhibit any documents in support
K even though such facts have not been pleaded in the petition. K
…
L L
30. The above principles are well-established and should be familiar with
M practitioners. However, it has become increasingly common for a M
petitioner to present a winding up petition against a company which only
contains an averment that the company failed to satisfy the statutory
N demand served upon it as the basis for contending that the company is N
insolvent and unable to pay its debts. The present case is a paradigm
example. The Petition is a 3-page document but the hearing bundles
O contain over 1,626 pages. It is of course unobjectionable for the petitioner O
to take this course if at the time it presented the petition, it was not aware
of any bona fide dispute on substantial grounds in respect of the debt and
P the company had not challenged the statutory demand.” P
Q Q
R
49. Given the Company’s letter dated 23 June 2025 sent in R
response to the SD making known its stance that it disputes the Debt, the
S S
Petitioner could not but have known that the Company would oppose the
T Petition. The Company disputes, inter alia, the correctness of the salaries T
paid to the employees. Further, it claims damages for the Petitioner’s
U U
V V
- 18 -
A A
wrongful solicitation and inducement of the Employees to breach their
B B
employment contracts with the Company by abandoning their duties and
C working directly for the Petitioner, causing loss to the Company. In other C
words, it is a claim for the tort of inducing breach of contract.
D D
E 50. Without making any response to the Company’s letter, the E
Petitioner presented its 4-page Petition supported by a short affirmation
F F
that did not answer any of the grounds of opposition made by the Company.
G Notably, it never sought to communicate with the Company. G
H H
51. A call-over hearing was scheduled to take place on 20
I October 2025 before Linda Chan J. On 13 October 2025, the parties made I
a joint application by way of Consent Summons for an order, inter alia,
J J
that the Petition be adjourned for argument with 3 hours reserved. The
K response from the Judge contained in the Court’s letter of 16 October 2025 K
reflects the views she had expressed in Re China Oceanwide. She opined
L L
that “The dispute raised by the Company is not one which should be
M determined in winding up proceedings and the Petition should be M
withdrawn20”.
N N
O 52. To succeed on its Petition, the Petitioner has to prove its O
claim against the Company by proving that it has valid section 43D notices
P P
Q 20
See the Court's letter dated 16 October 2025 which was in the following terms: Q
"1. The Petitioner was aware of the grounds raised by the Company in disputing the debt, the subject
R matter of the SD but proceeded to present the Petition. The Reply Affirmation does not address R
the point as to why the Petitioner ignored the contents of the letter dated 23 June 2025. It seems
that having been told about the grounds raised by the Company, the Petitioner should not have
presented the Petition but it chose to do so. The dispute raised by the Company is not one which
S S
should be determined in winding up proceedings and the Petition should be withdrawn.
2. If, despite the above observations, the Petitioner insists on proceeding with the Petition, it
T T
should be aware that the Court will likely order costs against it on a higher scale, should it come
to the view that the Petition constitutes an abuse of process."
U U
V V
- 19 -
A A
and/or Labour Tribunal awards or orders. Instead, as is clear from §§ 20-
B B
42 above, its case is sieve like, riddled with holes.
C C
53. Mr Li’s complaints that some of the points taken by the
D D
Company in its written submissions did not feature in Chan 1st and that the
E Company had ample time to apply for leave to file an affirmation in E
response to the matters raised in Cheng 1st are disingenuous. It would not
F F
be right for the Company to initiate rounds of exchange of
G affidavits/affirmations to try and resolve those differences. By the very fact G
that the Company had written to the Petitioner challenging its entitlement
H H
to the Debt, it was for the Petitioner to seek to resolve the issues before
I presenting the Petition. I
J J
54. It belies a failure to understand the Petitioner‘s obligation as
K explained in Re China Oceanwide which Mr Li distinguished on the basis K
that the Petitioner had given sufficient information to the Company for it
L L
to know facts and grounds they have to meet when it had not.
M M
55. At the hearing, Mr Li sought to dismiss the relevance of Re
N N
China Oceanwide on the basis that the facts in that case were very different
O (relating to redemption of senior notes/debenture). He insisted that the O
Petition was not a simple averment but contained sufficient information to
P P
let the Company understand or know the facts and grounds they have to
Q meet in opposing the Petition. Q
R R
56. The Petitioner simply brushed aside the very pertinent
S remarks made in the Court’s letter dated 16 October 2025. While the S
Petitioner accepts that the hearing bundles now before the Court would
T T
have been before the Judge, Mr Li submitted that after his clarification at
U the call over hearing on 20 October 2025 that there was no contractual U
V V
- 20 -
A A
relationship between the Petitioner and the Company, the Judge ‘agreed’
B B
that this case should be adjourned for substantive argument.
C C
57. That explanation does not sit happily with the substance of the
D D
Court’s letter of 16 October 2025, in particular the comments made by the
E Judge in the last paragraph. The Consent Order was made at the hearing E
which was 4 days after the Court’s letter, the Petitioner having decided to
F F
press ahead with the Petition.
G G
58. The Petitioner chose not to heed the Judge’s clear warning as
H H
to costs should it proceed with the Petition. In the circumstances, the
I Petitioner’s conduct merits a costs order that would mark the Court’s I
displeasure.
J J
K Order K
L L
59. The Petition is dismissed.
M M
60. Having regard to §58 above, I make an order nisi that the costs
N N
of the Petition be to the Company with certificate for counsel, such costs
O to be paid forthwith and on an indemnity basis. O
P P
61. It is directed that
Q Q
(i) the Company do lodge its statement of costs within 14 days
R R
hereof;
S S
(ii) the Petitioner do lodge its list of objections (if any) to the
T T
statement of costs (limited to 2 pages) within 14 days
U
thereafter; and U
V V
- 21 -
A A
(iii) the Company do lodge its reply (if any) limited to one page
B B
within 7 days thereafter.
C C
D D
E
(Doreen Le Pichon) E
Deputy High Court Judge
F F
G G
Mr Vincent Li, instructed by Messrs. NWK Lawyers, for the Petitioner
H H
Mr Joey Chan, instructed by Messrs. Chin & Associates, for the
I Company I
J J
K K
L L
M M
N N
O O
P P
Q Q
R R
S S
T T
U U
V V
A A
HCCW 386/2025
B [2026] HKCFI 834 B
C IN THE HIGH COURT OF THE C
HONG KONG SPECIAL ADMINISTRATIVE REGION
D D
COURT OF FIRST INSTANCE
COMPANIES (WINDING-UP) NO 386 OF 2025
E E
_______________________
F F
IN THE MATTER of the Companies
G
(Winding Up and Miscellaneous G
Provisions) Ordinance, Cap.32
H and H
IN THE MATTER of LONG
I ENGINEERING MANAGEMENT I
LIMITED (信豐工程管理有限公司)
J _________________________ J
K Before: Deputy High Court Judge Le Pichon in Court K
Date of Hearing: 29 January 2026
L L
Date of Judgment: 5 February 2026
M M
JUDGMENT
N N
O O
1. Dixie Engineering Company Limited (the “Petitioner”)
P presented a petition on 26 June 2025 to wind up Long Engineering P
Management Limited (the “Company”) based on the Company’s failure to
Q Q
pay the Petitioner the amount of HK $917,066.83 (the “Debt”) it demanded
R in a statutory demand (“SD”) issued to the Company on 3 June 2025. At R
the conclusion of the hearing judgment was reserved which I now give.
S S
T T
U U
V V
- 2 -
A A
Background facts
B B
C 2. On 24 June 2020, the Highways Department of the HKSAR C
Government (the “Highways Department”) awarded the Main Contract of
D D
its construction project of Contract No. HY/2019/21 (the “Project”) to the
E Petitioner. E
F F
3. The Petitioner entered into a written subcontract agreement
G on 16 September 2020 with Long Engineering Limited (“LEL”) G
subcontracting the works under the Main Contract to LEL (the “Sub-
H H
Contract Works”).
I I
4. LEL sub-contracted part of the Sub-Contract Works to the
J J
Company (the “Sub-subcontract”), primarily for the provision of labourers
K (the “Sub-subcontract Works”). The work site of the Project was in Tuen K
Mun (the “Work Site”).
L L
M 5. On 15 January 2025, the Petitioner wrote to LEL, alleging that M
LEL had failed to attend to the Work Site and to proceed with the Sub-
N N
Contract Works which LEL disputes. The Petitioner does not have any
O contractual relationship with the Company (being a lower tier sub-sub- O
contractor) or its employees.
P P
Q 6. On 17 January 2025, the Petitioner terminated its Sub- Q
Contract with LEL. It evicted LEL and then denied entry to the Company
R R
and their staff to the Work Site and removed their belongings and assets
S therefrom without consent. S
T T
U U
V V
- 3 -
A A
7. The SD issued on 3 June 2025 was in respect of the Debt
B B
which is said to arise solely from payments made by the Petitioner of
C outstanding wages owed by the Company to 281 of its employees who C
worked on the Project (the “Employees”) pursuant to section 43C of the
D D
Employment Ordinance, Cap 57 (“EO”).
E E
8. While letters from the Petitioner’s solicitors (“NWK”) dated
F F
9 and 17 June 2025 informed the Company of the SD having been ‘served’
G pursuant to section 178 (1) (a) of the Companies (Winding Up and G
Miscellaneous Provisions) Ordinance Cap 32, those letters did not enclose
H H
a copy of the SD despite the Company’s request. The Company only
I obtained a copy of the same by collecting it from NWK’s office. I
J J
9. The Company’s solicitors (“Chin”) responded by their letter
K dated 23 June 2025 specifically disputing the Petitioner’s entitlement to the K
Debt on various grounds, including the following:
L L
M • the Petitioner’s termination of LEL’s Sub-Contract was M
unlawful and invalid;
N N
O • it constructively terminated the Company’s Sub-subcontract, O
compromising the Company’ ability to comply with its duties
P P
under the EO (to provide work and place of work for its
Q employees); Q
R R
• such conduct caused a multitude of legal proceedings between
S the Company and its employees and gave rise to costs the S
T 1 T
Attached to the SD are "Particulars of Debts owed by the Company to the Petitioner" (the "List")
with 28 entries relating to payments made to the persons set out in the List. Although 2 of the entries
bear identical names (both in Chinese and English), the Company took no issue with the Petitioner's
U statement that they are two different persons. U
V V
- 4 -
A A
Company had to incur and in respect of which it would seek
B B
to recover as damages; and
C C
• the Company disagreed with the amounts of ‘wages’ paid by
D D
the Petitioner to the employees whose entitlement to the same
E is disputed. E
F F
10. The Company claimed that the Petitioner had solicited and
G induced its employees to breach their employment contracts and work for G
the Petitioner directly.
H H
I 11. The Petitioner did not respond to the Company’s invitation to I
withdraw the SD. Instead, it presented the Petition 3 days later.
J J
K The Petition K
L L
12. The Petition is a four-page document which did not address
M any of the points raised in Chin’s letter disputing the Debt. It never attempt M
to communicate with the Company its reasons for disputing the amounts
N N
of wages paid to the employees.
O O
13. The sole legal basis of the Petitioner’s claim to be entitled to
P P
be paid the Debt is pursuant to section 43F (1) of the EO which provides
Q that if a principal contractor pays to an employee any wages under section Q
43C, the wages so paid shall be a debt by the employer of that employee to
R R
the principal contractor.
S S
14. Section 43C deals, inter alia, with the joint and several
T T
liability of a principal contractor and superior sub-contractor to pay the
U wages of employees of sub-contractors. In the present case, the Petitioner U
V V
- 5 -
A A
is the principal contractor, LEL is a superior sub-contractor and the
B B
Company is a sub-sub-contractor for the Project.
C C
Whether the Company has raised a bona fide defence
D D
E 15. The key issue is whether the Company is able to demonstrate E
that it has a bona fide defence to the Petitioner’s claim for payment of the
F F
Debt.
G G
16. The Company contends that the Petitioner’s payments to the
H H
Employees are not payments pursuant to section 43C2.
I I
17. For present purposes, the 4 subsections of section 43C may be
J J
summarised as follows:
K K
L L
2
In pertinent part, section 43C provides as follows:
Sub-contractor’s employees’ wages
M 43C. Liability of principal contractor and superior sub-contractor to pay wages of employees M
of sub-contractors
(1) Subject to this Part, if any wages become due to an employee who is employed by a sub-
N contractor on any work which the sub-contractor has contracted to perform, and such N
wages are not paid within the period specified in section 23, 24 or 25, as the case may be,
such wages shall be payable to the employee—
O (a) where the sub-contractor has contracted with the principal contractor, by the principal O
contractor; and
(b) where the sub-contractor has contracted with a superior sub-contractor, by the principal
P contractor and every superior sub-contractor to the sub-contractor, jointly and P
severally.
(2) The liability of a principal contractor and of a principal contractor and superior sub-
Q contractor or superior sub-contractors jointly and severally under subsection (1) shall be Q
limited—
(a) to the wages of an employee whose employment relates wholly to the work which the
R principal contractor has contracted to perform and whose place of employment is R
wholly on the site of the building works; and
(b) …
S (3) Subject to subsection (4) the wages payable under subsection (1) shall be paid by the S
principal contractor or superior sub-contractor, as the case may be, not later than 30 days
after the date on which a notice under section 43D is received by him or service thereof is
deemed to be effected on him.
T T
(4) Where any claim in respect of the wages payable under subsection (1) is filed with the …
Labour Tribunal and an award or order is made in favour of the employee, the wages shall
be paid within such time as the … Labour Tribunal may direct, or, in the absence of any
U direction, not later than 30 days after the making of the award or order.” U
V V
- 6 -
A A
(1) if any wages become due to an employee employed by a sub-
B B
contractor to perform on any work the sub-contractor has
C contracted to perform and such wages are not paid within the C
period specified, the principal contractor and every superior
D D
sub-contractor are jointly and severally liable to the employee;
E E
(2) the joint and several liability of the principal contractor and
F F
superior sub-contractor are subject to specified limitations;
G G
(3) subject to (4) below, liability for the wages payable under
H H
subsection (1) does not arise unless a notice under section 43D
I is received by the principal contractor or superior sub- I
contractor; and
J J
K (4) where any claim in respect of wages payable under subsection K
(1) is filed with the Labour Tribunal and an award or order is
L L
made in favour of the employee, the wages shall be paid as
M directed and in the absence of any direction within 30 days of M
the making of the award or order.
N N
O 18. In connection with subsections (3) and (4) above, no liability O
arises unless there are valid section 43D notices or claims have been filed
P P
by some of the Employees with the Labour Tribunal and an award or order
Q is made in respect of each of those claims. In the present case, the Labour Q
Tribunal has not made any award or order in respect of any of the
R R
Employees.
S S
19. In the circumstances, the existence of valid section 43D
T T
notices is determinative. It is necessary to consider closely the provisions
U U
V V
- 7 -
A A
of section 43D as to what would constitute a valid section 43D notice. Of
B B
critical importance are subsections (1) and (3):
C C
(a) subsection (1) sets out 5 categories3 of information required
D D
for a valid section 43D notice; and
E E
(b) subsection (3) states that no liability to pay any wages under
F F
section 43C to the employee of the subcontractor can arise if
G that employee fails to serve a notice on the principal G
contractor under subsection (1).
H H
I 20. It was not until the Petitioner filed the affirmation of Raymond I
Cheng (“Mr Cheng”) on 29 August 2025 (“Cheng 1st”) in reply to the
J J
affirmation of Chan Chi Man (“Mr Chan”) dated 8 August 2025 (the “Chan
K 1st”) that the Petitioner disclosed documents 4 said to support the wage K
claims.
L L
M 21. Mr Cheng dealt with the Employees’ claims on behalf of the M
Petitioner. In §6 of his affirmation (filed in reply to Chan 1st), he describes
N N
the batch of documents in CR 1 as follows:
O O
“Each of the Employees had either issued a notice of claim to the Petitioner
under section 43D of the Employment Ordinance or lodged a claim in the
P P
Labour Tribunal against the Company as direct employer and the
Petitioner as the main contractor of the Project. The Petitioner does not
Q have a complete set of the claim forms lodged by the Employees in its Q
possession but only have those provided by the Labour Tribunal.”
(Emphasis added)
R R
S S
3
They are: (a) name and address of the employee; (b) name and address of his employer; (c) address
T T
of the place of employment of the employee; (d) particulars of the work in respect of which the wages
are due; and (e) amount of wages due and the period to which they relate.
4
Exhibit CR 1. The 1st page is a "Request for advancing of wages". The remaining documents are
U claims by some of the Employees lodged with the Labour Tribunal. U
V V
- 8 -
A A
22. The 1st page of CR 1 is an undated “Request for Advancing of
B B
Wages” (the “Request”) made by 11 individuals itemising outstanding
C wages for the month of December 2025. However, those individuals claim C
to be employed by LEL rather than the Company. In any event, only 4 of
D D
those names match the names of the Employees named in the “List5”.
E E
23. The remaining documents in CR 1 (the “remaining
F F
documents”) relate to claims made by 23 individuals, seemingly in the
G Labour Tribunal (the entity identified in Cheng 1st as the recipient of the G
claims lodged). As Mr Cheng acknowledged, the Petitioner does not have
H H
a complete set of the claim forms lodged by the Employees. CR 1 consists
I of documents said to be provided to the Petitioner by the Labour Tribunal. I
J J
24. The Company contends that the documents disclosed by the
K Petitioner do not constitute valid section 43D notices. In Wing Lee K
Engineering & Technical Services Ltd v Alliance Building Services
L L
Engineering Limited, CACV 275/2006, unrep., 27 April 2007, the Court of
M Appeal held (at §§33-38) that section 43F of the EO is not engaged if no M
section 43D notices have been served on the principal contractor, even if
N N
payment was made by it to an employee of the subcontract.
O O
25. It was only at the hearing that Mr Vincent Li, counsel for the
P P
Petitioner made submissions concerning the remaining documents but did
Q not address the points raised in §22 above concerning the Request. Q
R R
26. The Court was taken to the agreed translation 6 of a
S representative sample of Part II of Labour Department Form 136 (a) (the S
“LD Form”). The representative sample relates to a claim made by Chan
T T
5
See footnote 1 above.
U 6
B/9a/134. U
V V
- 9 -
A A
Ka Fai7 (“Claimant Chan”). His LD Form, in pertinent part, is reproduced
B B
below:
C C
“ LRD Ref. No.:________
Part II
D D
Important Notice/Disclaimer:
E The Labour Department does not represent or endorse the accuracy or reliability of E
any of the information or content of the claim stated below. … produced by …
claimant alone … need to be verified or clarified during the conciliation meeting
F where both parties could produce further evidence (e.g. employment records) for F
the said purposes.
G G
In order to facilitate conciliation, a copy of this page will be provided to the party
being claimed against for reference before the party being claimed against.
H H
Name of Claimant: Chan Ka Fai (in block letters) Signature of Claimant: (signed)
I I wish to claim the following: Amount I
Wages: (from 2 December 2024 to 31December 2024) $25850
…
J Overtime pay: (from 4 December 2024 to 31 December 2024) $1098 J
…
K Total amount : $26948 K
…
L L
…
LD 136(a) (Rev. 2023)”
M M
27. Mr Li referred to the prefix “LRD” to the reference number
N N
appearing at the top right-hand corner and the last line of the LD Form,
O submitting that they show that the LD Form emanates from the Labour O
Department. The 1st paragraph states that the amount claimed was to be
P P
verified or clarified at the conciliation meeting at which both parties
Q (Claimant Chan and the unidentified person(s) against whom the claim is Q
made) would have the opportunity to produce further evidence.
R R
S S
T T
7
Claimant Chan is the 2nd name on the List.
U U
V V
- 10 -
A A
28. The List shows that the Petitioner paid the amount (shown in
B B
the form exhibited) claimed by Claimant Chan on 17 January 2025. Mr Li
C submitted that the payment was the result of the conciliation meeting C
concerning Claimant Chan’s claim. Cheng 1st (at §8) reads as follows:
D D
“I attended various conciliation meetings which were arranged by the
E E
Labour Department for resolution of the Employees’ wage claims, as well
as hearings in the Labour Tribunal, as the Petitioner’s representative. The
F Company was represented by one Ms Mandy Chow [(“Ms Chow”)] in F
most of these meetings/hearings. In all of the meetings/hearings which I
attended, [Mr Chan] was not there. The stance taken by [Ms Chow] in
G these meetings/hearings was that the Company would not dispute the G
outstanding wages, but she had no instruction from the Company to make
any payment.”
H H
I I
29. The approach taken by the Petitioner is that:
J J
(i) all the payments made by the Petitioner and set out in the List
K K
are based on the outcome of various conciliation
L
meetings/Labour Tribunal hearings; L
M (ii) the Company was represented by Ms Chow at most of the M
meetings/hearings which Mr Cheng attended and Ms Chow
N N
did not dispute the outstanding wages claimed; and
O O
(iii) the LD Form coupled with declarations exhibited in the CR 2
P P
(considered in §32 below) operate as ‘deemed’ notices for the
Q Q
purposes of section 43C (3).
R R
30. Pausing there, the schedule attached to LEL’s letter to HD
S dated 5 February 20258 upon which Mr Li relies lists Ms Chow as one of S
LEL’s employees and not the Company’s. Mr Joey Chan, counsel for the
T T
U 8
See the table in [40] below. U
V V
- 11 -
A A
Company informed the Court that he has instructions that Ms Chow an
B B
LEL employee represented LEL and not the Company at some of the
C conciliation meetings. It would appear that the Petitioner relies on Cheng C
1st at §89 for his submission that Ms Chow was representing the Company
D D
and nothing more.
E E
31. Apart from being ambiguous, the passage from Cheng 1st
F F
(cited in §28 above) is deficient in many respects. To mention the most
G obvious (but by no means exhaustive) matters: G
H H
(i) Mr Cheng does not list the dates of hearings he attended nor
I the claim(s) that those hearings concerned. In other words, the I
hearings were unparticularised in many respects.
J J
K (ii) In Claimant Chan’s case, 3 payments were made to him on K
different dates. The LD Form exhibited relates to the 1st
L L
payment. There is no explanation concerning the other
M payments and why the Petitioner paid them. M
N N
(iii) No recipient is identified on the LD Form. The employee may
O claim against any one or more of the parties liable under the O
EO to pay his wages. Thus, they include the Petitioner, LEL
P P
and the Company.
Q Q
(iv) As the Petitioner admits, CR 1 is incomplete 10 . It is not
R R
understood why that should be so. Presumably, the Petitioner
S received a notice/request to attend the conciliation meetings. S
If so, there must have been some written communication from
T T
9
Cited in §28 above.
U 10
None of the remaining documents even bear an LRD reference number. U
V V
- 12 -
A A
the Labour Department. Moreover, it sheds no light on
B B
whether the Petitioner made any request for the full set of
C documents from the Labour Department. C
D D
(v) Conciliation meetings are not the same as Labour Tribunal
E hearings. E
F F
(vi) What constitutes an “outcome” of a conciliation meeting is
G not explained nor its legal effect (if any), nor the relationship G
(if any) between conciliation meetings and Labour Tribunal
H H
proceedings.
I I
(vii) What is very clear from the evidence is that no Labour
J J
Tribunal award or order has ever been made in respect of the
K Employees. K
L L
32. CR 2 consists, inter alia, of declarations signed by 12 of the
M 28 Employees. CR 1 and CR 2 together do not constitute valid section 43D M
notices as they do not comply with the requirements for a valid section 43D
N N
notice. The declarations in CR 2 appear to record private settlement
O arrangements with the Petitioner, with each of the 12 confirming that he O
would not pursue claims against the Petitioner regarding wage liabilities
P P
owed by the Employee’s employer.
Q Q
33. Valid section 43D notices require that they be in writing,
R R
stating 5 categories of information including the address of the place of
S employment of the employee. This information may be important because S
under section 43C (2) the liability of the principal contractor to pay wages
T T
jointly and separately applies to subparagraph (a) only. If the staff
U U
V V
- 13 -
A A
concerned is an office worker who is not working at the Work Site, the
B B
Company will know that section 43C does not apply to that employee.
C C
34. Apart from the above, the Company takes issue with whether
D D
one of the 27 individuals “Cheung Yuen” [張源] named in the List was an
E employee of the Company11. There is no section 43D notice in relation to E
this individual upon which the Petitioner could rely. Instead, in §18 of his
F F
affirmation Mr Cheng states that he “personally handled the wage claim of
G [張源] but gives no explanation as to why he considered it appropriate to G
H
mark [張源] as an employee of the Company, rather than LEL, in his own H
record.
I I
J 35. As appears from the Company’s letter sent in response to the J
SD12 that preceded the presentation of the Petition, another core issue of
K K
dispute is whether the payments made by the Petitioner to the Employees
L can properly be characterised as a payment of wages made pursuant to L
section 43C.
M M
N 36. As elaborated in Chan 1st at §21, it is a standard term in the N
employment contracts of the Company to pay a daily rate to the Employees
O O
as an advance payment for setting off against statutory holidays and annual
P leave (the “Statutory Payments”) that the Employees may be entitled in the P
future. Section 43C is only engaged “if any wages become due to an
Q Q
employee who is employed by a sub-contractor and such wages are not
R paid within the period specified in section 23, 24 or 25 [of the EO]”. Thus, R
a statutory debt can only arise to the extent that there is a default in payment
S S
of wages under the EO. Payments made by the Petitioner above what the
T T
11
See §25 Chan Chi Man’s affirmation dated 8 August 2025.
U 12
See §9 above. U
V V
- 14 -
A A
Company owes the Employees are not recoverable and advance payment
B B
and over-payment of wages are lawfully deductible from an employee’s
C wages. C
D D
37. It is clear from the employment contracts exhibited by the
E Company that the daily rate paid to the Employees that the advance E
payment is not a token amount but appears to be over 42% of the daily rate.
F F
In the circumstances, the Company is obviously entitled to question and
G challenge the amounts claimed by the Employees and paid by the Petitioner G
as unpaid wages without more.
H H
I 38. Having perused the documents in CR 1 and 2, I agree that I
even when read together they are not valid section 43D notices.
J J
K 39. Insofar as they are said to reflect claims lodged with the K
Labour Tribunal (which cannot be the case 13 ), they cannot assist the
L L
Petitioner since they are not “awards or orders” of the Labour Tribunal
M within section 43C (4). M
N N
40. I should mention that at the hearing the Petitioner’s opening
O submissions attached considerable significance to correspondence that O
took place between February and April 2025 summarised in the table below:
P P
Q Date Sender Recipient Q
05/02/2025 LEL HD 14
R 10/03/2025 LEL and the Company15 Engineer of the Project16 R
S S
13
See §23 above.
14
The letter was addressed to the Director of Highways.
T T
15
The signatories to the letter were LEL’s ex-Project Manager and the Company’s ex-Project Forman.
The letter was copied to a LegCo member, a member of the National People's Congress and the
Chairman of the Hong Kong Construction Industry Employees General Union.
U 16
Mannings (Asia) Consultants Limited. U
V V
- 15 -
A A
13/03/2025 LEL Mannings
B 17/03/2025 Chin Ng Kwok Keung17 B
25/03/2025 LEL HD18
C C
15/04/2025 NWK19 Chin
D D
41. The thrust of the Petitioner’s submissions as regards the
E E
correspondence set out above is that it was meant to exert maximum
F pressure on the Petitioner to pay the wages of the Employees and to F
dissuade Employees from claiming against the Company even though the
G G
Company as employer had a non-delegable duty to pay wages to its
H Employees. But the letters did no more than point out to the Recipient(s) H
the Petitioner’s contractual obligations as the principal contract under the
I I
EO. The EO expressly provides for the employees’ entitlement to obtain
J information about the principal contractor for the purpose of exercising J
their rights.
K K
L 42. As regards the letters sent to HD, the Petitioner was not the L
intended recipient of any of those letters. They were written by LEL who
M M
complains that the Petitioner’s failure to pay Sub-contract payments to LEL
N gave rise to financial difficulty for LEL to pay the employees. Its claims N
against the Petitioner is being litigated in other proceedings.
O O
P 43. In short, little assistance can be derived from those letters. P
Q Q
44. Finally, I turn to Mr Li’s reliance on the ‘deeming’ provision
R in section 43C (3). His submission is entirely misplaced. Properly read, the R
word ‘deem’ refers to service and not ‘notice’. The EO does not contain
S S
T 17 T
He is one of the claimants.
18
Copies were sent to the parties copied on the letter of 10/03/2025: see footnote 14 above.
19
NWK represents 4 of the ex-employees in claim made to the Labour Tribunal, and this letter was
U sent in reply to the 17/03/2025 letter. U
V V
- 16 -
A A
any mechanism to replace a notice in writing by oral discussions or some
B B
other informal matters.
C C
Conclusion
D D
E 45. I have no hesitation in concluding that the Company has E
demonstrated that it has a bona fide defence to the Debt. It has shown a
F F
strong case that there are no valid section 43D notices to support the Debt,
G such that the Petitioner cannot rely on section 43F (1). G
H H
46. Further, in the 23 June letter, the Company outlined its case
I against the Petitioner for wrongful inducement of breach of contract on the I
part of employees. The timing and rapid development of the events in a
J J
short time in mid-January supports the Company’s contention that the
K termination and the eviction had long been planned by the Petitioner and K
well in advance of its abrupt termination of LEL’s Sub-contract in mid-
L L
January. The List shows that 9 of the Company’s employees who became
M employed by the Petitioner started receiving their 1st payment from M
Petitioner between 13 and 17 January 2025. LEL’s contract was only
N N
terminated on 17 January 2025. This state of affairs cries out for an
O explanation and that is properly a matter for discovery which will only take O
place if there is a trial.
P P
Q 47. If the poaching of employees did occur, one direct loss from Q
the tort is the outstanding payment in lieu of notice from the employees
R R
and could well have resulted in the Company’s economic loss from the
S termination of the Sub-contract and eviction from the Work Site. S
T T
U U
V V
- 17 -
A A
Petitioner's obligation to provide sufficient information on the facts relied
B B
upon in its Petition
C C
48. Mr Joey Chan referred to Re China Oceanwide Group Limited
D D
[2023] HKCFI 455 where (at §§20-32) Linda Chan J considered the
E requirement in some detail. Of particular relevance are §§28 and 30: E
F “28. It seems to me that the requirement discussed in In re Fildes Bros. Ltd F
apply equally, if not with greater force, to a petition presented by a creditor
on insolvency ground. Unlike a ‘just and equitable’ petition which is
G G
determined after a trial with the benefit of pleadings, list of documents and
witness statements filed by the parties, a petition presented by a creditor is
H almost invariably determined by the court summarily, without any H
pleadings, discovery or witness statements. It is all the more important for
the court to insist that a petitioner must set out its case and the facts relied
I upon in the petition so that the company would know what case it has to I
meet at the hearing. Indeed, it is necessary for the court to insist on such
requirement as otherwise the company and the court would have to trawl
J through the affirmations and the exhibits filed by the parties, which are J
often voluminous as the affirmants (and those advising the parties) seems
to think that they can raise any facts and exhibit any documents in support
K even though such facts have not been pleaded in the petition. K
…
L L
30. The above principles are well-established and should be familiar with
M practitioners. However, it has become increasingly common for a M
petitioner to present a winding up petition against a company which only
contains an averment that the company failed to satisfy the statutory
N demand served upon it as the basis for contending that the company is N
insolvent and unable to pay its debts. The present case is a paradigm
example. The Petition is a 3-page document but the hearing bundles
O contain over 1,626 pages. It is of course unobjectionable for the petitioner O
to take this course if at the time it presented the petition, it was not aware
of any bona fide dispute on substantial grounds in respect of the debt and
P the company had not challenged the statutory demand.” P
Q Q
R
49. Given the Company’s letter dated 23 June 2025 sent in R
response to the SD making known its stance that it disputes the Debt, the
S S
Petitioner could not but have known that the Company would oppose the
T Petition. The Company disputes, inter alia, the correctness of the salaries T
paid to the employees. Further, it claims damages for the Petitioner’s
U U
V V
- 18 -
A A
wrongful solicitation and inducement of the Employees to breach their
B B
employment contracts with the Company by abandoning their duties and
C working directly for the Petitioner, causing loss to the Company. In other C
words, it is a claim for the tort of inducing breach of contract.
D D
E 50. Without making any response to the Company’s letter, the E
Petitioner presented its 4-page Petition supported by a short affirmation
F F
that did not answer any of the grounds of opposition made by the Company.
G Notably, it never sought to communicate with the Company. G
H H
51. A call-over hearing was scheduled to take place on 20
I October 2025 before Linda Chan J. On 13 October 2025, the parties made I
a joint application by way of Consent Summons for an order, inter alia,
J J
that the Petition be adjourned for argument with 3 hours reserved. The
K response from the Judge contained in the Court’s letter of 16 October 2025 K
reflects the views she had expressed in Re China Oceanwide. She opined
L L
that “The dispute raised by the Company is not one which should be
M determined in winding up proceedings and the Petition should be M
withdrawn20”.
N N
O 52. To succeed on its Petition, the Petitioner has to prove its O
claim against the Company by proving that it has valid section 43D notices
P P
Q 20
See the Court's letter dated 16 October 2025 which was in the following terms: Q
"1. The Petitioner was aware of the grounds raised by the Company in disputing the debt, the subject
R matter of the SD but proceeded to present the Petition. The Reply Affirmation does not address R
the point as to why the Petitioner ignored the contents of the letter dated 23 June 2025. It seems
that having been told about the grounds raised by the Company, the Petitioner should not have
presented the Petition but it chose to do so. The dispute raised by the Company is not one which
S S
should be determined in winding up proceedings and the Petition should be withdrawn.
2. If, despite the above observations, the Petitioner insists on proceeding with the Petition, it
T T
should be aware that the Court will likely order costs against it on a higher scale, should it come
to the view that the Petition constitutes an abuse of process."
U U
V V
- 19 -
A A
and/or Labour Tribunal awards or orders. Instead, as is clear from §§ 20-
B B
42 above, its case is sieve like, riddled with holes.
C C
53. Mr Li’s complaints that some of the points taken by the
D D
Company in its written submissions did not feature in Chan 1st and that the
E Company had ample time to apply for leave to file an affirmation in E
response to the matters raised in Cheng 1st are disingenuous. It would not
F F
be right for the Company to initiate rounds of exchange of
G affidavits/affirmations to try and resolve those differences. By the very fact G
that the Company had written to the Petitioner challenging its entitlement
H H
to the Debt, it was for the Petitioner to seek to resolve the issues before
I presenting the Petition. I
J J
54. It belies a failure to understand the Petitioner‘s obligation as
K explained in Re China Oceanwide which Mr Li distinguished on the basis K
that the Petitioner had given sufficient information to the Company for it
L L
to know facts and grounds they have to meet when it had not.
M M
55. At the hearing, Mr Li sought to dismiss the relevance of Re
N N
China Oceanwide on the basis that the facts in that case were very different
O (relating to redemption of senior notes/debenture). He insisted that the O
Petition was not a simple averment but contained sufficient information to
P P
let the Company understand or know the facts and grounds they have to
Q meet in opposing the Petition. Q
R R
56. The Petitioner simply brushed aside the very pertinent
S remarks made in the Court’s letter dated 16 October 2025. While the S
Petitioner accepts that the hearing bundles now before the Court would
T T
have been before the Judge, Mr Li submitted that after his clarification at
U the call over hearing on 20 October 2025 that there was no contractual U
V V
- 20 -
A A
relationship between the Petitioner and the Company, the Judge ‘agreed’
B B
that this case should be adjourned for substantive argument.
C C
57. That explanation does not sit happily with the substance of the
D D
Court’s letter of 16 October 2025, in particular the comments made by the
E Judge in the last paragraph. The Consent Order was made at the hearing E
which was 4 days after the Court’s letter, the Petitioner having decided to
F F
press ahead with the Petition.
G G
58. The Petitioner chose not to heed the Judge’s clear warning as
H H
to costs should it proceed with the Petition. In the circumstances, the
I Petitioner’s conduct merits a costs order that would mark the Court’s I
displeasure.
J J
K Order K
L L
59. The Petition is dismissed.
M M
60. Having regard to §58 above, I make an order nisi that the costs
N N
of the Petition be to the Company with certificate for counsel, such costs
O to be paid forthwith and on an indemnity basis. O
P P
61. It is directed that
Q Q
(i) the Company do lodge its statement of costs within 14 days
R R
hereof;
S S
(ii) the Petitioner do lodge its list of objections (if any) to the
T T
statement of costs (limited to 2 pages) within 14 days
U
thereafter; and U
V V
- 21 -
A A
(iii) the Company do lodge its reply (if any) limited to one page
B B
within 7 days thereafter.
C C
D D
E
(Doreen Le Pichon) E
Deputy High Court Judge
F F
G G
Mr Vincent Li, instructed by Messrs. NWK Lawyers, for the Petitioner
H H
Mr Joey Chan, instructed by Messrs. Chin & Associates, for the
I Company I
J J
K K
L L
M M
N N
O O
P P
Q Q
R R
S S
T T
U U
V V