JQ v. CLH

FCMC 7498/2018

[2021] HKFC 133

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 7498 OF 2018

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R U L I N G
( Leave to Appeal )
( By Paper Disposal )

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1.  By a judgment dated 27 May 2021 (“the Judgment”), I held the Family Court has jurisdiction over the present divorce proceedings commenced by the petitioner wife on the ground that the respondent had a substantial connection with Hong Kong on the date of the petition.  

2.  Dissatisfied with the judgment, on 10 June 2021 the respondent applied for leave to appeal.

3.  In this Ruling, for the ease of reference, I shall continue to refer to the petitioner as “the wife” and the respondent “the husband”. 

Applicable Legal Principles

4.  There should not be any dispute over the 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) (“the DCO”):

“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.  As I have already set out the parties’ case and their facts in the Judgment, I do not propose to repeat them here.  Suffice to say is that notwithstanding the husband did not have a significant physical presence in Hong Kong as at the date of the petition, nevertheless his economic and social presence is sufficient to constitute a substantial connection for the purpose of the divorce proceedings. I found that the husband’s situation is one of the exceptional circumstances where he had a substantial connection with Hong Kong even without the presence of his family in Hong Kong.

8.  In his skeleton submissions, Mr Chan, for the husband, relies upon both limbs of the statutory tests, ie (1) the appeal has a reasonable prospect of success; and (2) there is some other reason in the interest of justice that the appeal should be heard. However, for reasons only known to those representing the husband, the Notice of Appeal that is attached to the Summons set out the grounds in respect of the 1^st limb only.  There is no mention of the 2^nd limb.

1^st Limb – Reasonable Prospect of Success

9.  There are two grounds of appeal which I think can be dealt with in one-go.

10.  The first is I was wrong to find that the husband (without the presence of any family members) fell within the “exceptional” category of cases where his own sole connections with Hong Kong were so substantial that jurisdiction ought to be found. 

11.  The second is I wrongly elevated the husband’s rare physical presence in Hong Kong “mainly for economic reasons” (at [39] of the Judgment) into something that is sufficient to establish a solo substantial connection with Hong Kong.

12.  It is argued by Mr Chan that the husband was and is not exceptional.  The fact patterns of the husband are commonly to be found amongst businessmen with interests across the wide “Greater Bay Area” or indeed Shanghai or Beijing.  The fact that many people with multi-jurisdiction connections, in particular having general connections all across the “Greater Bay Area”, should not have been a factor in favour of Hong Kong having jurisdiction.  To the contrary, including on policy grounds and floodgate considerations, the fact that increasing number of persons having wide connections across different jurisdictions in the “Greater Bay Area” should lead to tightening up and strict application and implementation of the requirement to have a substantial connection with Hong Kong. 

13.  This argument was not advanced in the substantive hearing. In my view, there are merits in the argument.  Further, as I acknowledged in [33] of the Judgment, this case, on its facts, is a marginal one.  Hence, this, together with Mr Chan’s argument set out in the foregoing paragraph, should be sufficient to give the husband a reasonable prospect of success.

The 2^nd Limb

14.  As said above, the husband’s Notice of Appeal has not referred to the 2^nd limb as a ground.  Thus, strictly speaking, it is not necessary for me to deal with this limb.   I would just like to say the following.

15.  With the advent of ever changing communication technology and the development of the Greater Bay Area, this issue is a growing area and in the future there will be more and more people in similar situations like that of the husband.  There is a lack of appellate authorities on the following matters that deserve appellate attention:

(1)  Whether conducting “remote control” of Hong Kong companies / business from another jurisdiction rather than being physically present here could give rise to substantial connection?

(2)  Whether “remotely controlling” financial matters in Hong Kong from another jurisdiction, rather than being physically present in Hong Kong, would give rise to substantial connection?

(3)  Whether “economic presence” within Hong Kong is sufficient to give rise to substantial connections even without accompanying physical presence in Hong Kong?

(4)  Whether the above factors satisfy the requirements of “exceptionality”?

16.  Thus, I agree with Mr Chan that guidance from an appellate level will benefit all – including the Family Court, legal practitioners and parties. 

Orders

17.  For the above reasons, I grant leave for the husband to appeal on the grounds set out in the Notice of Appeal.

18.  The husband also applies for a stay of the proceedings pending the determination of the appeal. As leave to appeal has been granted, this is an appropriate order that I should make as well, and I so order.

Costs

19.  I make an order nisi that the costs of this application be in the cause of the appeal.