No second bite of the cherry? Court of Appeal to rule on whether Cap. 597 precludes

Recently, Madam Justice Au-Yeung granted permission to appeal against her own decision, in which she ruled that the Mainland Judgments (Reciprocal Enforcement) Ordinance (Cap. 597) (“𝗠𝗝𝗥𝗘𝗢”) was the exclusive regime for enforcing a judgment registrable under the MJREO, thereby barring common law enforcement.

Originally, in 華融華僑資產管理股份有限公司 v 李晓鹏 (China Huarong Asset Management Co., Ltd v Li Xiao Peng) [2025] HKCFI 6402, the Judge dismissed the Plaintiff’s application for summary judgment on the ground that the MJREO precludes common law enforcement of Mainland judgments that qualify for registration under the statutory regime.

𝗕𝗮𝗰𝗸𝗴𝗿𝗼𝘂𝗻𝗱

In October 2019, the Plaintiff obtained a judgment for payment of a sum of RMB150 million with interest at 18% against the Defendant, pursuant to a Civil Mediation Certificate issued by the Xining Intermediate People’s Court in Qinghai Province, Mainland China (the “𝗖𝗲𝗿𝘁𝗶𝗳𝗶𝗰𝗮𝘁𝗲”).

The Certificate was a registrable Mainland judgment under section 5(2) of the MJREO. Among other things, it was a final and conclusive judgment for a definite sum of money, issued by a designated Mainland court (which was also the chosen court) and made pursuant to a valid choice of Mainland court agreement.

However, the Plaintiff failed to apply for registration of the Certificate in Hong Kong within the 2-year time limit prescribed under section 7 of the MJREO. Instead, in 2024 (i.e. four years later), it commenced a common law enforcement action and applied for summary judgment to enforce the Certificate. It also sought the continuation of a Mareva injunction.

In opposition, the Defendant contended, among other things, that he had an arguable defence as section 22(2) of the MJREO precluded common law enforcement of the Certificate, which satisfied the requirements for registration under section 5(2)(a)–(e) of the MJREO.

𝗗𝗲𝗰𝗶𝘀𝗶𝗼𝗻

The Court found in favour of the Defendant, holding that if a Mainland judgment satisfied the requirements for registration under section 5(2)(a)–(e) of the MJREO, the exclusive enforcement route is the statutory mechanism under the MJREO.

The Judge stated that section 22(2) of the MJREO is clear and mandatory: it expressly provides that no court in Hong Kong shall entertain any proceedings for the recovery of a sum payable under a Mainland judgment which would satisfy the requirements specified in the MJREO, other than proceedings by way of registration of the judgment. Therefore, a common law action is barred.

The Court observed that the 2-year limitation period for registration under the MJREO was deliberate and driven by the policy intent of reciprocity and certainty, reflecting the corresponding two-year time limit for enforcement of judgments in the Mainland. Hence, having missed the 2-year deadline, the Plaintiff could not, in circumvention of the statutory limitation, seek to enforce the Certificate under the common law.

In so holding, Madam Justice Au-Yeung differed from an earlier decision of Mr Justice Keith Yeung (as he then was) in China Everbright Bank Co., Ltd. v. China Kingho Energy Group Ltd [2024] HKCFI 3586. In that case, his Lordship ruled that there was a good arguable case that whilst the Mainland judgment may no longer be registered after the expiry of the 2-year time limit, it may still be recognised for the purpose of common law enforcement. He considered that there is no readily discernible policy or other reason for the proposition that the common law enforcement route, once available, would be entirely abrogated by the MJREO.

𝗖𝗼𝗺𝗺𝗲𝗻𝘁𝘀

In view of conflicting first instance decisions, guidance from the Court of Appeal will be welcomed to clarify this important issue.

Meanwhile, pending the appeal, and as a matter of prudence, litigants and practitioners should comply with the two-year registration period, as failing to register within time will likely extinguish the right to enforce Mainland judgments in Hong Kong.

Further, applicants seeking ex parte relief on the basis of a common law cause of action for enforcement of a Mainland judgment must draw to the Court’s attention the potential section 22(2) defence and the conflicting first instance decisions. In her original decision, Madam Justice Au-Yeung robustly applied the “full and frank” disclosure requirement in ex parte applications and found that the Plaintiff failed to disclose the potential defence, and discharged the Plaintiff’s Mareva injunction without regrant, with an adverse costs order.

𝘋𝘪𝘴𝘤𝘭𝘢𝘪𝘮𝘦𝘳: 𝘛𝘩𝘪𝘴 𝘱𝘶𝘣𝘭𝘪𝘤𝘢𝘵𝘪𝘰𝘯 𝘪𝘴 𝘨𝘦𝘯𝘦𝘳𝘢𝘭 𝘪𝘯 𝘯𝘢𝘵𝘶𝘳𝘦 𝘢𝘯𝘥 𝘪𝘴 𝘯𝘰𝘵 𝘪𝘯𝘵𝘦𝘯𝘥𝘦𝘥 𝘵𝘰 𝘤𝘰𝘯𝘴𝘵𝘪𝘵𝘶𝘵𝘦 𝘭𝘦𝘨𝘢𝘭 𝘢𝘥𝘷𝘪𝘤𝘦. 𝘠𝘰𝘶 𝘴𝘩𝘰𝘶𝘭𝘥 𝘴𝘦𝘦𝘬 𝘱𝘳𝘰𝘧𝘦𝘴𝘴𝘪𝘰𝘯𝘢𝘭 𝘢𝘥𝘷𝘪𝘤𝘦 𝘣𝘦𝘧𝘰𝘳𝘦 𝘵𝘢𝘬𝘪𝘯𝘨 𝘢𝘯𝘺 𝘢𝘤𝘵𝘪𝘰𝘯 𝘪𝘯 𝘳𝘦𝘭𝘢𝘵𝘪𝘰𝘯 𝘵𝘰 𝘵𝘩𝘦 𝘮𝘢𝘵𝘵𝘦𝘳𝘴 𝘥𝘦𝘢𝘭𝘵 𝘸𝘪𝘵𝘩 𝘪𝘯 𝘵𝘩𝘪𝘴 𝘱𝘶𝘣𝘭𝘪𝘤𝘢𝘵𝘪𝘰𝘯.

Pamela Mak

Partner | Email