LYI also known as YIL v. JJ also known as JJ

FCMC 2960/2018

[2021] HKFC 197

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NO. 2960 OF 2018

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R U L I N G

( Leave to Appeal )

(Paper Disposal )

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1.  The judgment handed down by me on 16 August 2021 (“the Judgment”) was for the resolution of the parties’ ancillary reliefs in their divorce proceedings.  The orders I made are that, after having catered for the financial needs of their 2 children, the matrimonial assets are to be distributed to the petitioner wife and the respondent husband in 55/45 share.  This entails the liquidation of the former matrimonial home within 6 months of the decree absolute for the repayment of liabilities and for the division.  In addition, the respondent husband is to pay maintenance for the benefit of their children.

2.  Dissatisfied with the Judgment, the respondent applied for leave to appeal. 

3.  In this Ruling, I shall, for the ease of reference, continue to refer to the petition as “the wife” and the respondent as “the husband”.  I shall also adopt the same nomenclature and abbreviations used in the Judgment.

4.  As I have already set out the parties’ case and their facts in the Judgment, I do not propose to repeat them here.  This Ruling has to be read alongside the Judgment.

Applicable Legal Principles

5.  The relevant test governing applications for leave to appeal from the District Court is provided in 63A(2) of the District Court Ordinance (Cap 336):

“Leave to appeal shall not be granted unless the judge, the master or the Court of Appeal hearing the application for leave is satisfied that –

(a) The appeal has a reasonable prospect of success; or

(b)   There is some other reason in the interests of justice why the appeal should be heard.” [emphasis added]

6.  The Court of Appeal discussed the application of s 63A(2) in Sunny Tadjudin v Bank of America, National Association, HCMP No 691 of 2012 (Unreported, 29 June 2012) at [8] – [9]:

“8. Under section 63A(2) of the District Court Ordinance, Cap 336, leave to appeal to the Court of Appeal shall not be granted unless the Court of Appeal is satisfied that the appeal has a reasonable prospect of success, or that there is some other reason in the interests of justice why the appeal should be heard. Counsel relies on both limbs in section 63A(2) in seeking leave to appeal.

9. Reasonable prospect of success involves the notion that the prospect of succeeding must be “reasonable” and therefore more than “fanciful”, without having to be “probable” (SMSE v KL [2009] 4 HKLRD 125 para 17). Furthermore, it is pertinent to bear in mind that even if there is a reasonable prospect of success on appeal, the court still retains a discretion whether to grant leave to appeal, although the fact that there is, ex hypothesi, a reasonable prospect of success would heavily influence the court’s exercise of discretion (Ho Yuen Ki Winnie & Ors v Ho Hung Sun Stanley & Anr. HCA 391/2006, 25 May 2009, A Cheung J para 3; and HCMP 1009/2009, 24 August 2009, para 22). [emphasis added]”

The Husband’s Grounds of Appeal

7.  At the outset, it has to be pointed out that in his Intended Grounds of Appeal the husband made some references to what happened during the parties’ mediation.  Mediation proceedings are without prejudice to the parties’ rights and are confidential. For this reason, at trial nothing about the mediation was allowed to be adduced or made reference to before this court.  In the circumstances, I fail to see how anything said or done during the mediation could be a ground of appeal.

8.  The husband has altogether 24 paragraphs in his Intended Grounds of Appeal.  These paragraphs are apparently not organised in any logical sequence and some have one stroke of sentence only.  I must say while is it quite clear that 24 paragraphs do not mean 24 intended grounds of appeal, it is unclear as to how many intended grounds there are.  Some of the paragraphs are clearly irrelevant and cannot be grounds of appeal; for instance, the husband says at [6] that the court should write to the Housing Department to investigate into and check whether the wife owns another property with her former husband, at [8] that the wife did not arrange access to the children for him; and at [16] that the wife refused to perform the settlement agreement arrived at mediation.  Similar irrelevant grounds, by way of examples, can also be found in [15] (the husband does not understand why a trial was needed), [18] (about an undertaking given by the wife during mediation) and [21] (about some undertakings given by the parties during mediation). 

9.  There are also paragraphs from which the nature of complaints could not be understood in the context of this application for leave to appeal. For instance, the husband says at [3] that he was not notified of the handing down of the Judgment on 16 August 2021.  With respect, I cannot fathom how this could be a ground of appeal.  It is the practice of the court that notice would be given by phone and in the interest of social distancing during the Covid-19 pandemic the judgment would be sent to the parties by post. The husband further says in the same paragraph that he was not provided with documents by the other side. This made him not being able to give a response. He, however, does not specify what documents he is referring to and when these documents should have been provided to him.  At [23], the husband asks whether it should be the wife who is to pay maintenance to him.  This issue was never raised by the husband at trial. For the purpose of the present application, he also fails to articulate his reasoning.

10.  For the above reasons, I do not think it is necessary to deal with each and every paragraph in this Ruling.  Doing the best I can, I try to decipher the grounds and deal with them below.

Challenges to Findings of Facts

11.  To begin with, a majority of the grounds are challenges to the findings of fact made by me.  Essentially, the husband submits that I erred in some primary findings of fact. For the ease of discussion, doing the best I can, I group the husband’s challenges into the following categories as set out in the table below.

Findings of Fact	Relevant paragraphs in the Husband’s Intended Grounds of Appeal
Loans from the wife’s father	4, 25 & 26
Loans from the husband’s mother for down payment and renovation of the former matrimonial home	5 & 7
The wife’s financial needs	9 & 13
The wife’s financial resources, including her pension, whether the wife made full disclosure of her bank account and whether the wife has another property with her former husband	10, 11, 12, 17 and 22
The husband’s liabilities	20
The husband’s financial needs	24

12.  As pointed out by Ms Kwong, the husband’s above grounds are essentially a repeat of those he already made at trial and a re-run of failed arguments which have been rejected on the facts.  On the proper scope of an appeal against findings of fact, the Court of Appeal said the following in China Gold Finance Limited v CIL Holdings Limited & Ors, CACV 11/2015 (unreported, 27 November 2015),

11.  It is well settled that in respect of findings of fact, this court can only intervene when we are satisfied that the findings by the primary judge is plainly wrong: Ting Kwok Keung v Tam Dick Yuen (2002) 5 HKCFAR 336 is often cited and applied in this court.

12.  Regrettably, there are still cases coming before us in which counsel (including experienced and senior counsel) apparently failed to have regard to the proper role of the Court of Appeal in an appeal of this nature.  Thus, from time to time, we can find judgments from this court reiterating the fundamental principles in this respect: Chinachem Charitable Foundation Ltd v Chan Chun Chuen CACV 101 of 2010, 14 February 2011 para 26; Welltus Ltd v Fornton Knitting Co Ltd [2013] 5 HKC 106; Bank of China (Hong Kong) Ltd v Tsang Sheung Bun [2013] 5 HKLRD 62; Pang Ketian Sally v Tam Yuk Hung Annie CACV 147 of 2013, 25 April 2014; To Pui Kui v Ng Kwok Piu CACV 281 of 2012, 21 August 2014; Ageas Insurance Co Ltd v Lam Hau Wah Inneo CACV 65 of 2014, 9 January 2015 are some recent examples.

13.  Mr Lam also referred us to the recent judgment of the United Kingdom Supreme Court on the same topic: Carlyle v Royal Bank of Scotland [2015] UKSC 13 in which references were made to McGraddie v McGraddie [2014] UKSC 12; Henderson v Foxworth Investments Ltd [2014] 1 WLR 2600 and the judgment of the Privy Council in Beacon Insurance Co Ltd v Maharaj Bookstore Ltd [2014] UKPC 21.

14.  These authorities explained the limits of an appellate court in reversing the findings of fact of the primary judge.  We used the expression “primary judge” because it emphasizes the primary role of the first instance judge in the assessment of evidence and making of relevant findings of fact.  In our judicial system, the appellate process is not designed to give a litigant (or his counsel) a platform for regurgitating his closing submissions on the evidence and factual aspects of the case again with the hope that the appellate judges may come to a different view to that of the primary judge.  It is thus, as we said above, a misuse of the appellate process to place before this court submissions which, in substance, are (or should be) submissions advanced by way of closing submissions at the trial after the judge has heard all the evidence.

15.  In an appeal, the court of appeal should focus on the question whether the primary judge has fallen in palpable errors which could give rise to grounds for intervention by the appellate court.  As explained in the cases, it is not germane that judges in this court may reach a different conclusion from that of the judge.  There are many areas, particularly those in relation to findings of fact, where judges can reasonably reach different conclusions from each other. That would not be a ground for intervention. 

16.  Thus, in an appeal, it is not helpful if counsel and litigant (acted in person) only repeat submissions already advanced and considered by the primary judge at the trial.  The starting point should be the judgment of the primary judge and the identification of palpable errors (which must be errors of such nature which warrants intervention from this court) in the judgment.  The mere assertion that the finding of the judge is against the weight of the evidence or that the judge should have reached another conclusion because of points advanced in the closing submissions below are not errors coming within that category. 

13.  On appeals against the exercise of discretion, The Hong Kong Civil Procedure (2021) has the following discussion at §59/0/54,

Appeals against exercise of discretion—There are many authorities for the proposition that an appeal will not be entertained from an order which it was within the discretion of the judge to make, unless it be shown that he exercised his discretion under a mistake of law ( Evans v. Bartlam [1937] A.C. 473 ) or in disregard of principle ( Young v. Thomas [1892] 2 Ch. 134 ) or under a misapprehension as to the facts (ibid.); or that he took into account irrelevant matters ( Egerton v. Jones [1939] 3 All E.R. 889 at 892, CA) or failed to exercise his discretion (Crowther v. Elgood (1887) 34 Ch D 691 at 697) or the conclusion which the judge reached in the exercise of his discretion was “outside the generous ambit within which a reasonable disagreement is possible” ( G. v. G. [1985] 1 W.L.R. 647 ; [1985] 2 All E.R. 225 , HL). See also Banque Nationale de Paris v. Chan U Tong [1968] H.K.L.R. 151 , and Fung Tin Keung v. Hong Kong Wah Yuen Investment Co. & Another [1967] H.K.L.R. 650 , and Re SY Engineering Co. Ltd (unrep., CACV 1896/2001; [2002] H.K.E.C. 241 , CA) (appeal against a winding up order)…       (emphasis added)

14.  Thus, it is simply of no use and no assistance for the husband to just repeat his arguments.  In coming to the findings of fact, I have in the Judgment set out the relevant evidence and my analysis on why some evidence are accepted and some are rejected.  It is unnecessary to repeat my analyses and conclusions here.  In order to challenge the primary findings of fact, the husband must be able to point out how the conclusion of the facts was plainly wrong.  I have no doubt that the husband has failed to do so.  It also has to be remembered that the husband failed to file his section 7 narrative affirmation and elected not to give any evidence at trial.  Thus, the truthfulness of his evidence and the veracity of his case could not be tested: see [31] of the Judgment.  Of particular relevance are his assertions as regards the alleged loans from his mother, his liabilities owed to the banks and his financial needs which, without his evidence, simply cannot be substantiated.

Paras [1] & [2]

15.  The husband says he remains to be unemployed and he still has to pay (1) the mortgage repayments of the former matrimonial home and (2) his debts to the banks.  He does not have the ability to pay maintenance to his children.

16.  I was well aware that the husband was unemployed at the time of trial in April / May 2021.  I dealt with the husband’s earning capacity in light of his qualifications and work history and came to a conclusion that he would have an earning capacity of at least $60,000 per month. Of particular relevance is that, in his closing submissions, the husband mentioned he was interviewing jobs and there were a lot of potential offers: see [71] to [75] of the Judgment.  The Judgment was given about 3 months after the closing submissions.  On the evidence before me I was entitled to come to the conclusion (which I did) that the husband would have the ability to pay maintenance to his children.

17.  As regards the mortgage repayments and the loans repayment, it has to be pointed out that the mortgage loans and the sum owed under the Charging Order have already been taken into account in arriving at the net value of the former matrimonial home upon the sale of it: see [69] & [117] of the Judgment.  These liabilities would be repaid out of the proceeds of sale.  It is therefore important that the order for sale of 16 August 2021 is to be carried out within the timeframe set by this court.

18.  Again, in order to challenge the maintenance payment orders the husband must be able to point out how I erred in the consideration or analysis of the evidence before me at trial that led to the conclusion.  The husband’s assertion that he remains to be unemployed is not a ground.

Para [14] - Reimbursement of $25,607

19.  At para [14], the husband complains about the reimbursement of $25,607 that I allowed in favour of the wife: see [113] of the Judgment.  This money represents half of the student loan and the outstanding management fee the wife paid on behalf the husband after their separation.  He says it is unfair to him because at all times during the relationship the mortgage repayments and the utilities were paid by him.  As said, this $25,607 represents half of the money.  The student loan and the management fees were post-separation expenses and therefore should have been born by the parties in equal shares. The husband simply fails to point out how I erred in the exercise of the discretion in allowing the reimbursement.

Para [19] - The Husband’s HSBC Account

20.  The husband also complains, at [19] of his Intended Grounds, about what I said of the disclosure of his HSBC account.  I must confess I do not find this a relevant ground.  As I said in [61] of the Judgment, I took the view that even for any reason the husband indeed failed to make a disclosure, it is clear that this account was for repayment of the monthly mortgage payments of the former matrimonial home and there was no substantial sum of money in it.  I made myself clear in [61] & [105] of the Judgment that this was immaterial even where there was a non-disclosure and that no adverse inference as regards his financial situation was drawn against him. 

Conclusion & Order

21.  For the reasons aforesaid, I have no doubt that the husband’s application is unmeritorious.  There is simply no reasonable prospect of success nor is there some other reason in the interests of justice so that the appeal should be heard. The husband’s application should be dismissed and I so order.

Costs

22.  I see no reason why the husband should not be ordered to pay the costs of his application.  The wife’s solicitors have already lodged their Statement of Costs for summary assessment.  I consider this is the appropriate approach.  The Statement of Costs states a total sum of $52,259.  Adopting a board brush approach, I would allow a sum of $30,150 (with $20,000 as counsel’s fee).  I make an order nisi that the husband do pay the wife’s costs of this application, with counsel certificate, and that such costs are summarily assessed at $30,150.