M v. G

FCMP 36 / 2022

[2022] HKFC 242

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 36 OF 2022

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________________________

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J U D G M E N T

(For leave to make an application for an order of financial relief
under section 29AG of the Cap 192)

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1.  By her ex-parte originating summons filed on 21 April 2022, the applicant wife seeks to obtain leave from this court to commence her application for financial relief in this jurisdiction under Part IIA of the Matrimonial Proceedings and Property Ordinance, Cap 192 (“MPPO”), upon conclusion of her divorce with the respondent husband in China which put an end to their 55 years of marriage.

Some background facts

2.  The wife and the husband are in their 80s. They are both Chinese citizens, though the wife alleges that the husband has obtained the status of Hong Kong resident through investment into Hong Kong. I will say more on this later in this judgment.

3.  They were married in China in 1966. Their only son was born in 1967 and is now over 50 years old.  

4.  Over the years, the parties have accumulated substantial wealth and assets, which include landed properties and companies mainly in China. Of relevance to this application is a company in Shanghai specialising in manufacturing and sale of nutrition and hygiene products (“Shanghai BJ”). There are 2 shareholders of Shanghai BJ:

(1)  Its majority shareholder (93.52%)  is a Hong Kong registered company limited (“Broad Investment Ltd”). The husband holds 60.5% of Broad Investment Ltd. The other shareholders are the parties’ son (37%)  and a Mr Ho (2.5%);

(2)  The other shareholder (6.48%)  is another Shanghai company in which the husband holds over 50% of its shares (“Shanghai JLF”)

5.  It is said that Shanghai BJ holds substantial assets, including land rights and a factory on the land in Shanghai.

6.  In 2018, the wife petitioned for divorce in Zhuhai Court and claimed for financial relief.[1] She sought to share the assets of the husband, including the income received by him from Shanghai BJ and a declaration from the Zhuhai Court that Shanghai BJ and Broad Investment Ltd are the joint assets of the parties.  The husband defended the petition and claimed that the wife had dissipated a substantial amount of cash and/or family assets to their son, which should be added back for him to share.

7.  By its judgment made on 22 October 2019, the Zhuhai Court, among other things, allowed the wife’s petition for divorce. In financial relief, it ruled that the parties’ assets were to be shared. In particularly, it declared that Shanghai JLF are the joint asset of the parties, and that the wife is entitled to share half of the debt of RMB 5 million owed and repayable by Shanghai BJ to the husband. However, the Zhuhai Court refused to make any order concerning Broad Investment Ltd and a joint bank account with the Citibank, for the reason that these 2 assets are situated in Hong Kong. It commented that the parties should find another avenue to solve the problem (另尋途徑解決).

8.  Both parties were not satisfied with the judgment of the Zhuhai Court, and lodged a cross appeal with the Guangzhou Intermediate Court. [2] However, neither of them had any appeal in respect of the findings/comment of the Zhuhai Court on Broad Investment Ltd and the Citibank account. By its judgment dated 21 May 2021, the Guangzhou Intermediate Court allowed the cross appeal in parts. It also formally declared their divorce on 26 May 2021.[3]

9.  Subsequent to the aforesaid appeal judgment, the wife took out this ex-parte application for leave to apply for financial relief in Hong Kong, so that she would be able to share the interest/assets of Broad Investment Ltd, which in turn holds the majority shares of Shanghai BJ.

Applicable legal principles

10.  Part IIA of the MPPO empowers the court to grant financial reliefs after a marriage had been dissolved or annulled by a foreign court and such divorce or annulment is recognized as valid by the laws of Hong Kong (section 29AB(1)). Section 29AG provides that the court may make orders for financial provision and property adjustment that it could make under sections 4 to 6 of the MPPO.

11.  However, if any party to the marriage remarries, that party is no longer entitled to make an application under Part IIA in relation to that marriage: section 29AB(2).

12.  There is a filter mechanism established by section 29AC, in that an applicant must obtain leave of the court to bring an application under Part IIA. The statutory regime and threshold for leave application are explained and/or elaborated by the Court of Final Appeal in SPH v SA (2014)  17 HKCFAR 364 and Poon CJHC (then Poon J)  in C v H (Foreign Decree; Part IIA) [2012] HKFLR 199. The latter is the very first case in which a leave application was brought under section 29AC.

13.  Broadly, the legal principles at the “leave” stage may be summarized in the following.

14.  First, the Court of Final Appeal in SPH v SA (supra)  at §57 observed that the conditions for the application of Part IIA are “stringent”. Not only does section 29AC stipulate that an applicant must obtain leave from the court, it also provides that,

“The court must not grant leave unless it considers that there is substantial ground for the making of an application for an order for financial relief.”

15.  Poon CJHC (then Poon J)  explained the threshold of “substantial ground” in C v H (supra)  at §28, citing what Lord Collins had explained in Agbaje v Agbaje [2010] UKSC 13, [2010] 2 WLR 709:

“The threshold is not high, but is higher than ‘serious issue to be tried’ or ‘good arguable case’ found in other contexts. It is perhaps best expressed by saying that in this context ‘substantial’ means ‘solid’…”

16.  Second, the burden of showing that the threshold of “substantial ground” is met rests on the applicant, who must present before the court “all relevant facts in support” (§29 of C v H (supra)).

17.  Of note is the procedural requirements in rule 103A of the Matrimonial Causes Rules, Cap 179A (“MCR”), which stipulate what information should be provided to the court in the supporting affidavit of the leave application:

“ (1)  An application for leave to apply for an order for financial relief under section 29AC of the Matrimonial Proceedings and Property Ordinance (Cap 192)  must be –

(a)  made ex parte by originating summons in Form 27; and

(b)  supported by an affidavit by the applicant stating the facts relied on in support of the application with particular reference to the matters set out in section 29AF of that Ordinance.

(2)  The affidavit in support must give particulars of the judicial or other proceedings by means of which the marriage to which the application relates to the marriage was dissolved or annulled…, and must state, so far as is known to the applicant --

(a)  the names of the parties to the marriage and the date and place of marriage;

(b)  the occupation and residence of each of the parties to the marriage;

(c)  whether there are any living children of the family, and if so, the number of the children and each child’s full names (including surname)  and date of birth, or, if it be the case, that he or she is over 18;

(d)  whether either party to the marriage has remarried;

(e)  the full particulars of each party’s property and income; and

(f)  the grounds on which it is alleged that the court has jurisdiction to entertain an application for an order for financial relief under section 29AB of the Matrimonial Proceedings and Property (Cap 192).”

18.  Third and of much importance, the applicant must show that any of the following requirements in section 29AE is fulfilled, in order to invoke the jurisdiction of the court:

(1)  either of the parties to the marriage was domiciled in Hong Kong (i)  on the date of the application was made, or (ii)  on the date on which the foreign divorce took effect; or

(2)  either of the parties to the marriage was habitually resident in Hong Kong throughout the period of 3 years immediately before either of those dates; or

(3)  either of the parties to the marriage had a substantial connection with Hong Kong as at either of those dates.

19.  Poon CJHC (then Poon J)  explained at §30 in C v H (supra),

“If none of those formal requirements [in section 29AE] is satisfied, the court simply does not have the jurisdiction to entertain the substantive application for financial relief. It would be clearly wrong for the court to grant leave.” (my emphasis added)

20.  Fourth, once after an applicant passes the jurisdictional criteria in section 29AE, he must then also satisfy the court that it would be appropriate for the order to be made by a court in Hong Kong. In this regard, section 29AF imposes a duty on the court to consider whether Hong Kong is an appropriate venue for the application, and sets out the matters that the court must take into account, including and in so far as it is applicable to this case:

“ (a)  the connection that the parties to the marriage have with Hong Kong;

(b)  the connection that those parties have with the place where the marriage was dissolved…;

(c)  the connection that those parties have with any other place outside Hong Kong;

(d)  any fina ncial benefit that the applicant … has received, or is likely to receive, in consequence of the divorce … by virtue of any agreement or the operation of the law of a place outside Hong Kong;

(e)  if an order has been made by a competent authority outside Hong Kong requiring the other party to the marriage to make any payment or transfer any property to, or for the benefit of the applicant ….-

(i)  the financial relief given by the order; and

(ii)  the extent to which the order has been complied with or is likely to be complied with;

(f)  any right that the applicant has, or has had, to apply for financial relief from the other party to the marriage under the law of any place outside Hong Kong and, if the applicant has not exercised that right, the reason for that;

(g)  the availability of any property in Hong Kong in respect of which an order for financial relief in favour of the applicant may be made;

(h)  the extent to which any order for financial relief is likely to be enforceable;

(i)  the length of time that has elapsed since the date of the divorce ….”

21.  In C v H (supra), Poon CJHC (then Poon J)  explained at §33 that at the “leave” stage, the court cannot and will not come to a definite view if Hong Kong is the appropriate forum. Therefore, it should be sufficient if the applicant can establish “provisionally” that Hong Kong is the appropriate venue in order to pass the threshold for obtaining leave.

22.  Fifth, His Lordship went on to point out at §35 that while Part IIA aims at remitting the presence of a failure in a foreign jurisdiction to afford appropriate financial relief, the statutory test does not require the applicant to prove hardship, injustice or exceptionality as a pre-condition in order to obtain leave. But, if such factors are present, they are cogently relevant to the court’s consideration for granting leave. Their absence is however not fatal.

23.  With the above legal principles in mind, I shall now go into the wife’s application.

The procedural matters  

24.  I must say at this stage that the preparation of the wife’s supporting affirmation that was filed with her ex-parte summons is far from satisfactory.

25.  The said supporting affirmation has not fulfilled the procedural criteria in rule 103A(2)(f)  of MCR of explaining on the ground(s)  that the wife relies to invoke the jurisdiction of the court. Further, it has not provided or sufficiently provided the information or facts to the matters set out in section 29AF of the MPPO, as required by rule 103A(1)(b)  of MCR. For example, the wife merely exhibited the written judgment from the Zhuhai Court and the Guangzhou Intermediate Court in her supporting affirmation, without any explanation or reference to the relevant parts of these judgments as to the details of the financial relief orders made by the PRC Courts and the extent to which the order(s)  has/have been complied with.

26.  Hence, in the call-over hearing of 21 June 2022 and upon hearing from her legal team, I had to direct that the wife should file a supplemental affirmation on her case of “substantial connection” with all the facts that she would rely on and should exhibit the movement records of her and the husband for 3 years immediately preceding 26 May 2021, ie the date that the Guangzhou Intermediate declared the formal divorce of the parties.

27.  In consequence, the wife filed her supplemental affirmation dated 23 August 2022. She exhibited her movement records into/out of Hong Kong, which shows her very sparse physical presence in Hong Kong. From May 2017 to May 2021, she came to Hong Kong for only 3 times, spending as little as 1 night or as much as 4 nights once a year between 2017 and 2019; she never visited Hong Kong in the years of 2020 and 2021.

28.  The wife has not provided the movement records of the husband in her supplemental affirmation per my order of 21 June 2022.  Mr Lam Shun Chiu, her counsel, confirms that she has not taken out any application for discovery against the Director of Immigration for the husband’s movement records, and she is satisfied to proceed with her leave application on the evidence before this court.  

Substantial connection

(i)  The wife’s case

29.  By her said supplemental affirmation, the wife seeks to rely on the following alleged facts to support that the husband had a “substantial connection” with Hong Kong as at the date their divorce took effect, ie 26 May 2021: 

(1)  he had a financial tie with Hong Kong since 2005 by holding the shares of Broad Investment Ltd, a limited company registered in Hong Kong. Broad Investment Ltd is the holding company of Shanghai BJ, both of which are important components of the family assets;

(2)  he came to Hong Kong more frequently than her, and he had applied for Hong Kong residency via the capital investment entrant scheme (來港較我頻繁， 亦申請了以投資移民身[份]取香港居留權).

(ii)  Physical presence or Hong Kong residency

30.  The phrase of “substantial connection” is not defined in any family legislations, but over the years, abundant cases have been decided by our Court of Appeal on its meaning, such as: ZC v CN (Divorce: jurisdiction) [2014] 5 HKLRD 43; JEK v LCYP [2015] 4 HKLRD 798; ZJW v SY, CACV 10/2017, date of judgment 1 December 2017; Re WSJ (Minor)(Parentage: jurisdiction) [2019] 1 HKLRD 977.

31.  The most recent judgment given by Chow JA in JQ v CLH [2022] 2 HKLRD 632 has succinctly summarized the legal principles in determining if a person has “substantial connection” with Hong Kong at §21-§22 which is repeated as follows:

“21. The principles for determining whether a person has a “substantial” connection with Hong Kong for the purpose of s 3(c)  of the Ordinance are well established. The leading authority on this topic in Hong Kong is the judgment of the Court of Appeal in ZC v CN (Divorce: jurisdiction) [2014] 5 HKLRD 43, where Cheung JA (with whom the other two members of the Court of Appeal agreed)  considered in depth the statutory requirement of substantial connection under that section:

“[9.1] In line with the modern approach of statutory interpretation, one should not simply look at the natural and ordinary meaning of the words ‘substantial connection’ but also the context and purpose of this term.

[9.4] Whether a person has a substantial connection with Hong Kong is clearly a question of fact. No definition for this term will be succinct or comprehensive enough. What one may do is to look at the surrounding factors to see whether that person is substantially connected with Hong Kong at the time of the petition. As a starting point, one begins to see if that person has connection here and then decide whether that connection is a substantial one, see S v S [2006] 3 HKLRD 751 paragraph 15. In terms of connection, there must be physical presence in Hong Kong, this must be the ground rock of invoking the divorce jurisdiction. But because of the requirement of ‘substantial’, the presence cannot be of a transitory nature otherwise this will encourage ‘fly in’ and ‘fly out’ divorces, a theme that the Court has consistently emphasised, see, for example, Griggs (nee Sharp)  v Griggs [1971] HKLR 299, Ta Tran Thi Thanh v Ta Van Hung and Another [1981] HKDCLR 37 and more recently S v S, B v A [2008] 1 HKLRD 43.

[9.5] In the majority of cases, where a married couple is in Hong Kong, the Court will have no difficulties in ascertaining whether they have a substantial connection here. Thus in RI v SSH [2010] 4 HKC 588, this Court held that:

̒4. …… Hence in order to see whether the proceeding has a real and substantial connection to Hong Kong one must, first of all, ascertain whether at the time of its commencement the parties have substantially conducted their matrimonial life in Hong Kong. Hong Kong being an international commercial city, the identification of this issue is most acute for expatriate families who live in Hong Kong. The relevant considerations are, for example, whether the parties’ matrimonial home is here, what is their past pattern of life; do they regard Hong Kong as their home for the time being even if their life style may indicate that they may not take root in one place for too long a time. Related to the issue are matters such as the place of work of the spouses: do they choose to work here; even if one of them has to ‘commute’ overseas to work, is Hong Kong still treated as their home base. Likewise for the children of the family: are they studying here or spending their vacations here even if they are studying abroad.’

See also LN v SCCM (CACV 62/2013), Judgment dated 4 June 2013 and DGC v SLC (née C)[2005] 3 HKC 293.

[9.6] While the discussion in RI v SSH was in the context of forum non conveniens, the question of forum is dependent on the place where the parties have the most real and substantial connection with the action. Hence the suggested factors are clearly applicable to the present discussion.

[9.7] Traditionally, the discussion of this topic mainly centred on the foreign expatriate community who are present in Hong Kong because of business commitments or to avail themselves of the opportunities in this international commercial city, see, for example, S v S, B v A, G v G [2005] 1 HKFLR 182 and Z v Z (Substantial Connection and Forum)  [2012] HKFLR 346. Increasingly in recent years this issue is extended to many of the Hong Kong and Mainland China families who have homes or businesses both here and in the Mainland. Examples can be found in this and other cases such as LS v AD (Forum; Discovery in the PRC)  [2012] HKFLR 376 and YS v TTWD (Substantial Connection: Forum)  [2012] HKFLR 129. The focus of discussion in these cases is not about mainlanders who came here on visitors’ two way permit but those who have resident status in Hong Kong. Needless to say, the same approach of looking at the surrounding circumstances in order to ascertain the presence of substantial connection is to apply to these parties as well.

[9.8] The fact that a party has resident status which allows him or her to live here legally is only a factor to be taken into account. He or she may not be living here on a long term basis and only comes here occasionally. No doubt one has to look at other factors such as the party’s past pattern of life, the frequency of his visit to Hong Kong, the length and purpose of the stay, whether the party is engaged in business or work here, whether the rest of the family is here and whether a home has been established here and whether the children are at school here. It is also important to bear in mind that since the legislation only requires the party to establish a substantial connection in Hong Kong, he or she at the same time may have a substantial connection elsewhere, see S v S. In my view, if a party is shown to have substantial connection elsewhere by reason of his home or work, this may be used to contrast with the connecting factors he has in Hong Kong to see whether the Hong Kong connection is a substantial one.

 [9.9]  It is said in Savournin at page 184 (and also B v A at paragraph 20)  that a meaning must be given to substantial connection wider than domicile or three years’ ordinary residence.  But this is not intended to be interpreted so loosely as to encourage residence of passage (Indyka v Indyka [1969] 1 AC 33 at 105)  or divorce of convenience.  At the same time it will be unduly restrictive if one confines the connecting factors solely to that of a family context, namely, accommodation in a matrimonial home and presence of spouses and children. While in the majority of cases, family context is the focus of the inquiry and a material factor, there may well be situations where a party is in Hong Kong without the presence of his family, but nonetheless is able to show that he has a substantial connection here.  It really depends on the circumstances of the case.  Such cases, however, must be regarded as exceptional.”

22.  Further valuable guidance on the meaning of substantial connection for the purpose of s 3(c)  of the Ordinance can be found in the judgment of Hartmann J (as he then was)  in S v S [2006] 3 HKLRD 751:

“[11] The first reported authority concerning the meaning and extent of s.3(c)  of the Ordinance appears to be Savournin v Lau Yat Fung [1971] HKLR 180, a judgment of Briggs J. Having identified the origins of the phrase ‘substantial connection’ in English family law, the judge confirmed that s.3(c)  had established a new basis for determining the personal law of the parties to a marriage; in short, a new and additional ground of jurisdiction. He said:

‘Domicile in a country is obviously a substantial connexion with that country: so may three years ordinary residence be so considered.  Paragraph (c), a substantial connexion with Hong Kong, is in addition to those two requirements.  It is not substituted for them.  A meaning must be given to the phrase wider than domicile or three years ordinary residence.’  [my emphasis]

[12] As to the meaning of the phrase, Briggs J said that it was to be given its ordinary meaning; in short, it was not a term of art. Whether or not a party to a marriage had a substantial connection with Hong Kong has to be decided therefore within the factual context of each case.

[13] In my view, when considering the meaning and extent of the phrase, it is important to recognise that the legislature saw fit to qualify it with the indefinite article ‘a’. It is not therefore necessary for a petitioner to demonstrate that his substantial connection with Hong Kong is the only substantial connection he has with any jurisdiction or that his connection with Hong Kong is the most substantial connection he has with any jurisdiction. No exercise of comparisons is required. It is sufficient if he demonstrates that, among others perhaps, he has ‘a’ substantial connection with Hong Kong.

[14] Increasingly we are living in a world without borders. Capital sums are moved in moments from one side of the world to the other with little or no regard for national boundaries. The internet is universal. It is commonplace for even the modestly affluent to have homes in two countries. It is no longer only in the world of fiction that successful business people may at the same time live and work in two countries. S.3(c)  is not at odds with this new reality. The subsection recognises that a petitioner who asserts a substantial connection with Hong Kong may also have a substantial connection with one or more other jurisdictions.

[15] But, of course, if the Hong Kong courts are to exercise jurisdiction, it must be shown on a balance of probabilities that a petitioner not merely has a connection with Hong Kong but that, bearing in mind the scope and purpose of the Ordinance, the connection is ‘substantial’.

[16] ‘Substantial’ is a plain enough English adjective. We all understand what it means – at least in substance (if I may be excused the play on words). I say that because it is not a word that lends itself to precise definition or from which precise deductions can be drawn. To say, for example, that ‘there has been a substantial increase in expenditure’ does not of itself allow for a calculation in numerative terms of the exact increase. It is a statement to the effect that it is certainly more than a little but less than great. It defines, however, a significant increase, one that is weighty or sizeable.

[17] It speaks for itself, I think, that an artificially constructed connection will not be a substantial one. A connection must be real in the sense, for example, that it has not been engineered for temporary tactical advantage. It was not the intention of the legislature (in passing s.3(c)  into law)  to create a convenient off-shore divorce jurisdiction. As it has been said in an earlier authority, the subsection is not intended for ‘birds of passage’.

[18] As the jurisdiction looks to the determination of matrimonial proceedings, a material factor will be whether both parties to the marriage have lived in Hong Kong and, if so, how long they have lived here as man and wife. But those factors will not necessarily be determinative. In each case the factors to be considered will be different and the weight to be given to them, in the factual context of each case, will no doubt be different too.

[19] In summary, whether – for the purposes of the Ordinance – a connection is substantial or not can only be determined on the basis of a broad objective assessment, taking all relevant factors into account.”

  (my emphasis added)

32.  It is thus very clear from the above case law that in order to establish a “substantial connection” with Hong Kong, it must be shown, at the very least, that a person has, among other things, physical presence in Hong Kong and not of a transitory nature.

33.  In his written submission, Mr Lam for the wife no longer seeks to pursue her alleged fact that the husband had frequent visits to Hong Kong, or that he had applied for or obtained the Hong Kong residency. In my view, this is a correct concession to make, at least for 2 reasons.

34.  There is simply not a single piece of documentary evidence to support that the husband had physical presence in Hong Kong at the material times, including the frequency and the duration, or that he had really applied for and/or has obtained the Hong Kong residency. As said, the wife has not provided his movement records.

35.  Further, the wife’s bare assertion of the husband’s obtaining of the Hong Kong residency is contradicted by the annual return of Broad Investment Ltd dated 10 January 2022 and filed with the Companies Registry.  In the said annual return, the address of the husband was a Guangzhou address. On the item of “identification document”, he gave his Chinese passport number, and next to the item of “Hong Kong Identity Card Number”, he gave the answer “Nil”. In any event, the fact that a party has resident status which allows him or her to live in Hong Kong legally is not a conclusive factor, and is only “a factor to be taken into account” (ZC v CN (supra)  at §9.8).

36.  Therefore, and just in case of any doubt, I do not believe, and thus will not accept, that the husband had made any frequent visits to Hong Kong and that he held any Hong Kong residency as at the material times. That is to say, the wife fails to establish that the husband had a substantial connection with Hong Kong as at 26 May 2021 by reason of his “physical presence” and not of “a transitory nature” in Hong Kong (ZC v CN [2014] 5 HKLRD 43 at §9.4).

(iii)  Financial connection

37.  The crux of Mr Lam’s argument, if to put in a nutshell, is this:

(1)  Part IIA of the MPPO is modelled on the English Matrimonial and Family Proceedings Act 1984 (“1984 Act”), but does not copy the English counterparts verbatim. If one is to compare section 29AE of the MPPO with its counterpart of section 15(1)  of the 1984 Act, it will be noted that the requirements as to “domicile” and “habitual residence” are identical. However, unlike its English counterparts in section 15(1)(c)  of the 1984 Act, which requires either party to the marriage should have “a beneficial interest… in a dwelling-house in England and Wales which was at some time during the marriage used as a matrimonial home”, section 29AE(c)  of the MPPO requires either party to the marriage to have a “substantial connection” with Hong Kong.  This shows that the intention of the Hong Kong legislature must be to offer greater flexibility to the courts, so that apart from landed property ownership, other property holding or financial ties may also be considered;

(2)  The body of cases dealing with the requirements of substantial connection have no application to an application under Part IIA of the MPPO, because they are related to divorce proceedings under Matrimonial Causes Ordinance (“MCO”), Cap 179, such as ZC v CN (supra), or declaration of parentage under Parent and Child Ordinance, Cap 429 (“PCO”), such as Re WSJ (supra). Both MCO and PCO are statues dealing with the legal status of the propositus. The relevant underlying policy is to prevent “fly in” and “fly out” divorce or declaration of parenthood. On the other hand, an application under Part IIA of the MPPO deals with the assets of the parties to the marriage, and thus their financial ties to the forum is relevant to the purpose of Part IIA;

(3)  The husband’s ownership of the shares in Broad Investment Ltd is not of a transitory nature, and that such shares are not readily disposable assets. 

38.  To Mr Lam’s submission, I have the following to say.

39.  First, I accept that whether a party to the marriage has/had a substantial connection with Hong Kong is fact-sensitive. I also accept that the factor of “financial ties” with Hong Kong should not be precluded from the consideration of the court.  However, the issue to determine in this application is whether the husband can be said to have a substantial connection with Hong Kong merely “by his ownership of the shares in Broad [Investment Ltd]”, [4] but without any evidence that he had any physical presence in Hong Kong.

40.  Second, the submission of Mr Lam raises the issue of statutory interpretation of what constitutes “substantial connection” for the purpose of section 29AE(c)  of the MPPO, and whether it entails the same requirements as that adopted in cases decided under MCO and PCO. He also makes submission on the possible legislative intent of the said section 29AE(c).  However, the court is not given any helpful assistance as to any relevant documents or papers tabled during the legislative procedures/debate on the term of “substantive connection” under Part IIA. I have to look up the legislative records myself (which are public records of the Legislative Council)  in order to find out if the term of “substantial connection” in Part IIA was ever discussed or debated in the legislative procedure.

41.  Upon my own research, it is found that the new Part IIA of the MPPO came into force in March 2011. Before the law was passed, there was a paper prepared by the Department of Justice in May 2010 for the LegCo Panel on Administration of Justice and Legal Services in relation to the introduction of the new Part IIA (LC Paper No. CB(2)1615/09-10(01)  (“LegCo Paper”). The LegCo Paper set out the purpose, background, and proposed amendment of the new Part IIA. Of note is that the then proposed jurisdictional requirements did not follow section 15(1)(c)  of the 1984 Act, nor did it include “substantial connection” as one of the criteria. The then proposed wording was that either of the parties to the marriage being:

(1)  habitually resident in Hong Kong for at least 1 year; or

(2)  a permanent resident of Hong Kong.

42.  The LegCo Paper also recorded the views given by various stakeholders on the aforesaid proposed wording on the jurisdictional requirements in the new section 29AE, such as the Law Society, the Bar Association and the Judiciary,[5] as a result of which the said section 29AE was re-drafted into its present form, which is analogous to three jurisdictional requirements in section 3 of the MCO, ie domicile, habitual residence, or substantial connection in/with Hong Kong.

43.  It is thus clear that the legislative intent of section 29AE of the MPPO is to align the jurisdictional threshold with that of the MCO. It follows that the same meaning and requirement of “substantial connection” adopted in cases decided under MCO should also be applicable to section 29AE(c)  of the MPPO. 

44.  Third, the Court of Appeal in Re WSJ (supra), when giving its appeal judgment on whether the body of cases on substantial connection in matrimonial cases should apply to section 6(2)(c)  of the PCO, took the view that the context in which a statute was to be interpreted included other statutes in pari materia ie other statutes dealing with comparable matters (at §39), and thus the same interpretation which the courts have placed on “substantial connection” in other family legislations should be adopted in interpreting the said section 6(2)(c).  Further, the Court of Appeal referred to the judgment of HH Judge Own in CMU v WPM (Part IIA Application) [2012] HKFLR 245, in which the learnt judge applied the same interpretation of “substantial connection” under the MPPO to the leave application before him.

45.  It is thus clear to me that the case law also shows that the same interpretation/meaning to the phrase of “substantial connection” under the MCO and the PCO should apply to the MPPO.

46.  Fourth, even if (just assuming that)  the court should focus solely on the financial ties of the husband with Hong Kong without the requirement for his physical presence in Hong Kong, all the wife is able to show to this court is merely the husband’s ownership in Broad Investment Ltd. Apart from this, there is no evidence that the husband has/had any other financial connection with Hong Kong. It is not suggested by the wife that they ever had a matrimonial home, other landed properties or other substantial investment in Hong Kong.  Further, it is very unlikely that Broad Investment Ltd has a de facto office or staff in Hong Kong, because according to its annual return filed with the Companies Registry, its registered address is the office of its company secretary, World Link Business Services Ltd.

47.  Taking the wife’s case to its highest, the husband’s ownership of shares of Broad Investment Ltd may at the most be regarded as a connection with Hong Kong. But the law requires that a substantial connection be proved. I have to say that on the evidence before me, the wife has failed to prove that the husband had a substantial financial connection with Hong Kong.  

48.  To conclude, I reject that the husband had a substantial connection with Hong Kong.

Hong Kong as the appropriate venue

49.  Merely for the sake of completeness, I shall briefly consider the relevant factors in section 29AF by reference to the exhibits. The wife does not expressly and/or clearly provide any explanation or elaboration to each of these factors in her 2 affirmations:

(1)  section 29AF(2)(a)  -- I cannot see there is any connection of either parties with Hong Kong, save that the husband owns the shares of Broad Investment Ltd, and that they held a Citibank account in Hong Kong;

(2)  section 29AF(2)(b)  -- obviously the parties had/have very close connection with PRC where the divorce order was made;

(3)  section 29AF(2)(c)  -- it does not seem to me that the husband has connection with any other place outside Hong Kong save and except the PRC. The wife was/is living with the son and his family in the USA during all the material times of this case, including this argument hearing. The Zhuhai Court held that she owned 2 villas (with carpark(s))  and an apartment in Los Angeles, and a hotel-managed villa in Indonesia, but this was reversed by the Guangzhou Intermediate Court. Aside from these, the court has no other information on her connection with any other place outside Hong Kong;

(4)  section 29AF(2)(d)  and (e)  -- the Guangzhou Intermediate Court held that (i)  both parties may continue to use House 2802 in Zhuhai; (ii)  the wife may keep the car registered in her name; (iii)  the husband should pay her RMB116,001.72 within 30 days; (iv)  the wife is entitled to receive 50% of the repayment of loans to the husband. The wife has not provided any information to this court as to whether, and if so what, financial relief order(s)  made by the PRC Courts has/have been complied with;

(5)  section 29AF(2)(f)  -- the wife has not provided any information on this factor, save that she only refers to the judgment of Zhuhai Court that it refused to make any order concerning Broad Investment Ltd and a joint bank account with the Citibank, for the reason that these 2 assets are situated in Hong Kong;

(6)  section 29AF(2)(g)  -- there are properties available in Hong Kong in respect of which a financial relief order may be made, namely the shares of Broad Investment Ltd and a Citibank account;

(7)  section 29AF(2)(h)  – the wife has not provided any information to this court on this factor;

(8)  section 29AF(2)(i)  – the wife took out her application for leave about 11 months after the appeal judgment of the Guangzhou Intermediate Court was made (which according to the law of the PRC, this is final and no further appeal is allowed), or 9 months after the Guangzhou Intermediate Court issued the divorce certificate. I do not hold that there is any unreasonable delay on the part of the wife to make this application.

50.  The threshold at the “leave” stage for the wife to satisfy the court that it would be appropriate for the order to be made by a Hong Kong court under section 29AF is not very high. Had she been able to prove the jurisdictional criteria of “substantial connection”, I would say that “provisionally” Hong Kong is an appropriate venue to make a financial relief order in respect of the husband’s shares of Broad Investment Ltd and the interest in the Citibank account (if any)  (C v H (supra)).  

Order

51.  For all the matters aforesaid, the wife’s originating summons filed on 21 April 2022 shall be dismissed, with no order as to costs, including any costs reserved.