NPYJ v. SMRC

CAMP 216/2023, [2023] HKCA 1094

On Appeal From [2023] HKFC 52

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO. 216 OF 2023

(ON AN INTENDED APPEAL FROM FCMC NO. 9098 OF 2018)

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D E C I S I O N

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Hon Cheung JA (giving the Decision of the Court) :

I.  Renewed application for leave to appeal

1.  This is the respondent’s renewed application for leave to appeal against the decision of His Honour Judge KK Pang handed down on 24 March 2023 (‘the Decision’).

2.  By the Decision, the Judge dismissed the respondent’s summons filed on 11 January 2023 for specific discovery of the following six types of documents or information (‘Discovery Application’) :

1)  The funds/transactions listed in the respondent’s 131^st Affidavit to include nature, purpose, source, whereabouts, details of bank accounts in which such funds/transactions are recorded together with all supporting documents (Request 1);

2)  All the petitioner’s earned income from 2008 to 2014 (Request 2);

3)  All consultancy agreements, employment contracts, share option schemes and other forms of agreement entered into by the petitioner in the last six years, including all sums earned as an employee and/or by self‑employment not limited to through [7 named persons/businesses] (Request 3);

4)  All payments made to and from the petitioner or others acting on her behalf and her mother and her daughter from her previous marriage since separation on 20 September 2016 including any advances, loans and any other transactions entered into with the aforesaid (Request 4);

5)  The nature of all items of expenditure/income through the petitioner’s bank accounts which exceed HK$10,000 (not already disclosed) with supporting documents to include the purpose and whereabouts of withdrawals which exceed HK$10,000 with supporting documents and, if transferred to another bank account, please state the bank account number and holder. Please state the source and nature of any deposits which exceed HK$10,000 together with supporting documents (Request 5); and

6)  All credit card statements from three years before her first Form E filed on 22 January 2018 to date (Request 6).

3.  The Judge identified the principles relevant to an application for specific discovery at [5] of the Decision. He then analysed each of the requests in turn at [6] to [11] of the Decision. In short, the Judge took the view that the documents sought are not relevant or necessary for disposing fairly of the matter or to save costs. The Judge further observed that the requests were all identical or materially similar to questions which were initially included in the respondent’s questionnaire dated 27 September 2021 but subsequently crossed out by the order of Her Honour Grace Chan dated 8 October 2021 and the order of the Judge dated 3 December 2021. He also held that some of the requests are in the nature of a fishing exercise.

4.  By a summons filed on 11 April 2023, the respondent applied to the Judge for, among other things, leave to appeal against the Decision and a stay of the ancillary relief proceedings pending the determination of the leave application.

5.  On 25 May 2023, the Judge handed down a decision refusing the respondent’s applications. The Judge observed that the proposed grounds of appeal were mere repetition of the respondent’s case which the Court had already carefully considered in the Decision. He concluded that the intended appeal did not have a reasonable prospect of success, nor was there any reason in the interest of justice that the appeal should be heard. Since the intended appeal is not arguable, the Judge also refused to order any stay of proceedings.

6.  The respondent now renews his application to this Court for leave to appeal and stay of proceedings. We will deal with the application on paper.

II.  Principle

7.  Since the Decision (being a ruling on an application for discovery) was a case management decision in the exercise of the Judge’s discretion, it can only be challenged on appeal on limited grounds. As stated by Kwan JA (as she then was) in Wong Kar Gee Mimi v Severn Villa Ltd [2012] 1 HKLRD 887 at [31] :

‘ It must also be borne in mind that the orders made by the Judge in the intended appeal are case management decisions in the exercise of the discretion of the trial judge. Case management decisions are only subject to appeal in rare circumstances. The appellant faces a “very high hurdle” and must show that the judge “has gone clearly wrong and made orders which will clearly involve an injustice or an inability for the trial court to carry out its task”, or if the judge “erred in principle or the order was irrational having regard to the issues that had to be resolved”. It need hardly be emphasised that generally, an appellate court will not interfere with a judge’s exercise of discretion unless the judge has misunderstood the law or the evidence or the exercise of his discretion was plainly wrong such that it was outside the generous ambit within which a reasonable disagreement is possible.’

8.  The approach when determining a discovery application in ancillary relief proceedings is well established. The discovery must be relevant and proportionate, and it is for the Court to control what is to be disclosed. Rayden and Jackson on Relationship Breakdown, Finances and Children contained the relevant extracts :

‘ [13.104]

In financial remedy proceedings, disclosure and discovery begins with service of the Form E and the documents which are required to be attached to the Form E, and any other documents necessary to explain or clarify any of the information contained in the Form E. Thereafter, disclosure and discovery is by means of a questionnaire served in advance of the First Appointment and considered by the court at that appointment, and, if the court gives permission, by further questionnaire at a later stage of the proceedings. Questionnaires can, like interrogatories, request information as well as seek production of documents. As part of its case management role, the court should regulate the extent of the discovery of documents so that the exercise is proportionate to the issues in question, and to ensure that the discovery process does not become a fishing expedition approved by the court.

[13.105]

In Imerman v Tchenguiz [2010] EWCA Civ 918, [2010] 2 FLR 814 the Court of Appeal made two general observations in relation to discovery and disclosure:

“[33] In relation to these Rules we make two general observations. First, that the Rules do not provide for any disclosure of information or disclosure (discovery) of documents until a spouse has lodged his Form E. Second, and even more significantly, that the process of disclosure (discovery) of documents both then and thereafter is closely regulated by the Rules and, in accordance with the Rules, by the court. Although there is a general and continuing duty to make full disclosure of all relevant information, there is, despite the duty imposed on the court by s 25 of the 1973 Act, no duty of general disclosure (discovery) of documents of the kind required in ordinary civil proceedings by the CPR. And whereas in ordinary civil proceedings the parties can normally choose what documentary evidence to tender, it is the court which controls what documents are to be disclosed and tendered by way of evidence in ancillary relief proceedings.

[34] Thus, judges deciding such applications have a far greater control than they have under the CPR in normal civil proceedings, over which documents should or should not be produced in evidence.” ’

9.  See, for example, AWK v MLTH (unrep., FCMC 2454, 2014, 17 August 2015) at paras 9 to 10.

III.  Our view

10.  In the present case, the respondent’s grounds for challenging the Decision are set out in the ‘Notice and Grounds of Appeal’ dated 7 June 2023, which spans 25 pages. In addition, the respondent has filed two written statements dated 7 June 2023 and 15 August 2023 respectively in support of his application.

11.  The gist of the respondent’s arguments is that the Judge has committed an error of law by applying the wrong test applicable to civil cases when determining the Discovery Application. Specifically, the Judge is said to have failed to appreciate that disclosure obligations in matrimonial proceedings are owed to the Court and not merely to the counterparty, and that litigants in matrimonial proceedings owe a duty to give full and frank disclosure. Reference is made to a number of family cases which include, inter alia, Sharland v. Sharland [2015] 2 FLR 1367, Charman v Charman [2006] 2 FLR 422 and GW v RE (Financial Provision : Departure from Equality) [2003] 2 FLR 108 that emphasised the need for full, frank and clear disclosure in respect of any application for financial remedies. According to the respondent, if the correct test had been applied, the Discovery Application would have been allowed in full since the requests were all ‘conventional headings of disclosures’ in ancillary relief proceedings.

12.  In our view, it is not to the point to say that litigants in ancillary relief proceedings owe a duty to the Court to give full and frank disclosure. There is obviously a limit as to what a party is entitled to compel the other side to disclose and produce by way of an application for discovery, even in matrimonial proceedings. What is essential is that the disclosure must in the first place be relevant and the extent of disclosure must be proportionate to the issues involved. Here, while criticising the Judge as having adopted the wrong test, the respondent has not identified what those limits should be.

13.  In our view, the Judge was plainly entitled to consider the relevance and necessity of the requests, and whether the requests constituted a fishing exercise or were otherwise disproportionate, when determining the Discovery Application. There is no error of principle in the Judge’s approach.

14.  We have further considered the reasons put forward by the respondent for making the requests and the Judge’s reasons for disallowing the requests. We cannot see any basis for suggesting that the Judge has misunderstood the evidence, or was plainly wrong or irrational, in finding that the requests were irrelevant, unnecessary, disproportionate or otherwise constituted a fishing exercise.

15.  For these reasons, we are of the view that the intended appeal has no reasonable prospect of success, nor is it apparent to us that there are other reasons in the interest of justice why the intended appeal should be heard. The application for leave to appeal is accordingly refused. Given the lack of merits of the intended appeal, we also refuse to grant the stay of proceedings sought by the respondent.

16.  Since the petitioner has not participated in the present application, we will make no order as to costs.

17.  As the respondent’s application is totally without merit, we will pursuant to Order 59, rule 2A(8) make an order that no party may request our determination to be reconsidered at an oral hearing inter partes.