RI v. SSH

CACV261/2009

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO.261 of 2009

(On Appeal from HCMC No.7 of 2009)

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REASONS FOR JUDGMENT &
ORDER FOR COSTS

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Hon Cheung JA:

1. This Court dismissed the respondent husband’s appeal against the refusal by Hartman JA (sitting as an additional judge of the Court of First Instance) to stay the petitioner wife’s divorce petition on the ground of forum non conveniens.  I now give my reasons.

Forum non conveniens : underlining principle

2. The underlining principle in challenges against the Hong Kong Court’s jurisdiction on the ground of forum non conveniens is whether the Hong Kong proceeding has a real and substantial connection to Hong Kong.  This theme is manifested by the test that in order to succeed in the challenge not only is Hong Kong not the appropriate forum but another jurisdiction is the more appropriate forum.  In other words, Hong Kong is not the appropriate forum because another jurisdiction has a real and substantial connection to the proceeding : see Spiliada Maritime Corporation v. Cansulex Ltd [1987] AC 460.  Since Louvet v. Louvet and others [1990] 1 HKLR 670, Hong Kong Courts have consistently applied the Spiliada principle to challenges involving the Hong Kong matrimonial jurisdiction: see, for example DGC v. SLC nee C [2008] HKFLR 160.  The application of the Spiliada principle to the matrimonial jurisdiction was expressly approved of by the House of Lords in De Dampierre v. De Dampierre [1988] 1 AC 92.

Distinct nature of matrimonial proceeding

3. In Butler v. Butler (No. 1) [1997] 2 FLR 311, Thorpe LJ responding to the argument that in considering what is the natural forum, the Court should exclude all factors that are not directly relevant to an ancillary relief contest, which in that case means that the only relevant factors are difficulties for the wife in litigating in this jurisdiction and inconvenience to witnesses, held that,

‘ In my judgment the judicial analysis is not so confined. Before each court is a suit for divorce, a proceeding that changes status and marks the end of the most intimate of human relationships with all the attendant emotional and psychological turbulence. Although it would now be open to the husband to present a fresh petition alleging 2 years’ separation and consent the route to dissolution is still at large. It is therefore not apt to confine factors to those that would be relevant to the trial of a contractual dispute. The balance of fairness as between the parties to the marriage, the consideration to which the court primarily has regard, should not be construed restrictively. The origins of the parties, the history of their relationship, their post-separation conduct, the consequences of granting or refusing a stay, as well as considerations affecting the preparation and despatch of litigation, are relevant to the exercise of the statutory discretion.’

4. These are wise words and they reflect the distinct nature of a matrimonial proceeding.  I do not, however, understand them to mean a departure from the Spiliada principle.  Matrimonial proceedings are concerned with human beings and the regulation of their lives after the dissolution of their union as husband and wife in terms of custodial and financial provisions.  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.

5. These considerations may well overlap with the considerations in deciding whether either of the parties is ‘habitually resident’ in Hong Kong for the purpose of commencing a divorce in Hong Kong.  If the parties are habitually resident here, the petitioner is entitled to commence the proceedings as of right in Hong Kong and this factor must be given recognition in the ‘real and substantial connection’ deliberation.

The parties in the present case

6. The parties in this case, the husband a French national of Algerian origin, the wife an Indonesian, have after their marriage in 2000, conducted a ‘nomadic’ lifestyle, spending their time in Denmark (one and a half years), India (five years) and Belgium (three years) before eventually coming to Hong Kong in 2008.

7. When they came to Hong Kong, they had sold their former matrimonial home in Belgium.  They shipped their furniture to Hong Kong and acquired a lease for their new home here.  The husband’s intention was to set up a business in Hong Kong.  One of the children of the family enrolled in a Hong Kong school, followed a year later by the older child.  While there was exploration of the family moving to Singapore, this did not materialise because of the eventual break down of the marriage.

8. In my view Hartmann JA was correct to hold that even for this short period (a year in Hong Kong for the husband and nine months for the wife), the parties have established a real and substantial connection to Hong Kong.  This is because during this period Hong Kong is the place where they lead their matrimonial life.  By contrast although the parties had held a civil marriage in France (preceded first by a marriage in Jakarta conducted according to Muslim rites), the younger child was born in France when the parties decided not to give birth in India and although the parties hold properties in France, they have never conducted their matrimonial life in France at all.

9. One, of course, must not lessen the importance of a parent wishing his child to be born in his homeland but in the overall scheme of things, the choice of the place of birth for the younger child appeared to be for the purpose of ensuring that she will obtain French nationality if born in France rather than an indication that the parties regarded France as their ‘root place’.  While the parties have substantial assets in France, they also have assets elsewhere outside France.  As observed by this Court in DGC, Hong Kong Courts regularly dealt with cases, matrimonial or otherwise, concerning overseas properties. 

10. In such circumstances, how can it be said that not only is Hong Kong not the appropriate forum but France is the more appropriate forum.  The evidence shows that France will enforce a foreign judgment if there is no element of fraud and the matter in dispute has a real connection with the foreign jurisdiction.  In other words a Hong Kong judgment may be enforced in France.

Present position

11. The present position is that after the hearing below the husband no longer lives in Hong Kong and has moved to Dubai after his business plan has failed to materialise here but the wife and the children are still here in Hong Kong.  The wife has a Belgium entry permit which is said to allow her to enter France.  This permit will expire in June 2011.  The wife and the young child are here on dependents visas (based on the husband’s visa to enter Hong Kong) which will expire in April 2011.  The elder daughter is on a visitor’s visa.  But if the wife has a legitimate purpose to pursue in Hong Kong, namely the conduct of the matrimonial proceeding, I do not see why permission for her to stay in Hong Kong could not be sought for at the expiration of her dependents visa.  In any event the issue concerning the expiration of her visa to stay in Hong Kong begs the question whether at the time of the commencement of the proceeding, there is a real and substantial connection to Hong Kong.

Conclusion

12. In my view the Judge’s exercise of discretion against staying the Hong Kong proceeding cannot be faulted.

13. I further agree with Yuen JA’s view on juridical advantage and the costs order she makes.

Hon. Yuen JA:

14. This is an appeal from a judgment of Hartmann JA (sitting as an additional judge of the Court of First Instance) given on 11 November 2009 refusing a party’s application to stay matrimonial proceedings in Hong Kong on the ground that Hong Kong was not the appropriate forum. 

15. On 4 May 2010 after hearing counsel for both parties, we dismissed the appeal and said that we would hand down the reasons for our judgment, and deal with costs of the appeal, in writing.  My reasons for judgment and my order for costs appear below.

Background

16. The appellant (“the Husband”) now aged 45, was born in Algeria and raised in France.  He holds French nationality.  The respondent to the appeal (“the Wife”) now aged 42, was born in Indonesia and educated in the United States.  She holds Indonesian nationality. 

17. The Wife has a daughter “D” now aged 16, by a previous marriage.  D holds American nationality.  It is common ground that the Wife has always had care and control of D and that D’s contact with her father has not been close.  The Husband accepts that, under Hong Kong family law, D would be regarded as a child of the family.

Marriage

18. The Husband had for many years been employed in senior positions by a multi-national pharmaceutical company.  In 1998, he met the Wife while he was working in Indonesia.  In March 2000, the parties underwent a ceremony in Indonesia.  There is a dispute now as to whether it was a civil ceremony as well as a religious ceremony.  A few months later, in July 2000, the parties went to France where they underwent a civil ceremony of marriage.     

Denmark (9-18 months)

19. Afterwards the Husband was transferred to Denmark.  There is a dispute as to the length of time they stayed there but that is not important.  The Husband says they lived there for 14 -18 months (he having gone to Denmark a little earlier than the Wife and D).  The Wife says they were there for 9 months. 

India (4½-5 years)

20. In 2001, the Husband was assigned to India.  They stayed there for 4½- 5 years.  It would appear that in 2002, the Wife made an application for French nationality but that did not come to pass.  

Birth of L in France

21. The Wife became pregnant when the parties were living in India.  The parties decided that the child should be born in France, even though the Wife’s family was in Indonesia and the Husband’s parents were then living in the United States.  The child “L” is now aged 7, and holds French nationality.

22. Before and after the child’s birth, the Wife stayed in a house in Aix en Provence which the Husband shares with his siblings as a holiday home.  The Husband says it was a gift from their parents. 

Apartment in Paris

23. In 2004, according to the Husband, his parents gave him some money which he used to acquire an apartment in Paris.  The apartment was acquired in the name of a company, of which 4990 shares are held by the Husband and 10 shares held by the Wife.  The apartment has always been let out to tenants.  It is not entirely clear whether a mortgage was taken out for the purchase but that is not material for present purposes.

Belgium (3 years)

24. After nearly 5 years in India, the Husband left his previous employers and commenced employment with a Belgian pharmaceutical company.  The family moved to Belgium.  A house was bought in the joint names of the Husband and Wife.

Hong Kong

25. After about 3 years in Belgium however, in 2008 the Husband left the Belgian pharmaceutical company and accepted employment with a bio-pharmaceutical start-up company in Hong Kong. 

26. In April 2008 the Husband moved to Hong Kong first.  The following month, the Belgian property was sold and the proceeds deposited in a bank account in Paris.  In August 2008 the Wife and L moved to Hong Kong.  D stayed in Indonesia until she came to Hong Kong sometime later, on 5 June 2009. 

27. The family leased an apartment in South Bay, Hong Kong.  Their furniture in Belgium was shipped out to Hong kong but apparently some was kept in storage.  At some point they looked for property to buy in Hong Kong.  However they were also considering relocating to Singapore and arrangements were made for the children to be enrolled in schools there.

Matrimonial proceedings

28. Unfortunately the parties experienced difficulties in their marriage.  On 29 May 2009 the Wife presented a petition for divorce in Hong Kong.  It was served on the Husband the next day.  The Wife alleged in the petition that both parties have a substantial connection with Hong Kong.  The Husband has not challenged this.

29. Less than a week after the Wife’s petition, on 4 June 2009 the Husband presented a petition for divorce in France.

Application to stay Hong Kong proceedings

30. On 12 June 2009 the Husband applied to stay matrimonial proceedings in Hong Kong on the ground that Hong Kong was not the appropriate forum.  The parties proceeded to file evidence, including expert legal evidence, on this issue.

31. In the meantime, the business in Hong Kong did not flourish and in August 2009 the Husband was given notice terminating his employment. 

Guardianship of Minors proceedings

32. On 17 September 2009 the Husband issued proceedings under the Guardianship of Minors Ordinance for access to L.  D was not included in the application.

Proceedings before Hartmann JA

33. On 2-4 November 2009, Hartmann JA heard the Husband’s application to stay the Hong Kong proceedings.  On 11 November 2009, he gave judgment refusing the application.

Events after Hartmann JA’s judgment

- Proceedings in France

34. Since Hartmann JA’s judgment, there has been a hearing in France.  On 10 December 2009, the Family Court judge of the High Court of Paris rendered an Order staying proceedings there until the Hong Kong court definitively established its jurisdiction.  The Husband applied for an expedited appeal against this order but on 9 March 2010, the Court of Appeal of Paris refused his application.

- Husband’s departure from Hong Kong

35. In January 2010 the Husband has relocated to Dubai where he now works.  This has a bearing on the immigration status of the Wife and the children in Hong Kong.  The Wife and L are here only on dependants visas which will expire in April 2011.  D is here on a visitor’s visa.  The Wife has said that she wishes to apply for permanent residence in Hong Kong under the capital investment scheme.  However there is no evidence that any concrete steps have been taken.

Guiding principles

36. The guiding principles for applications for stay of proceedings for forum non inconveniens have been set out in Hartmann JA’s judgment at paras. 35- 40 and in Cheung JA’s judgment.

37. Since this is an appeal from Hartmann JA’s exercise of discretion, this court would not interfere unless the judge had erred in law, or had misapprehended a material fact, or had taken an irrelevant matter into account, or had failed to take a relevant matter into account, or had been plainly wrong.  If the judgment cannot be faulted on any of these grounds, then it matters not that the appellate judges may have taken a different view had they been sitting at first instance.  Of course relevant events occurring after the judgment may also have a bearing.

Appeal

38. It is clear from the submissions made by counsel for the Husband that he has not suggested that Hartmann JA had made any error in law.  Nor is it suggested that he has misapprehended any material facts. 

39. Counsel has however submitted that when the judge held that “in respect of the determination of the children’s best interests, Hong Kong is clearly the most appropriate forum”, the judge failed to take into account the fact that there were Guardianship of Minors Ordinance proceedings in Hong Kong where the best interests of the children could be determined, separately from the divorce and ancillary relief proceedings which should be litigated in France. 

40. Counsel for the Husband argued that the judge’s exercise of discretion should be set aside on that ground, and that this court should exercise the discretion afresh and find that France is the natural forum and grant the Husband’s application for a stay of the Hong Kong proceedings. 

41. Counsel has also argued that the judge placed too much weight on certain relevant factors, and not enough weight on others.

Discussion

42. It is correct that Hartmann JA did not expressly refer in his judgment to the Guardianship of Minors Ordinance (“GMO”) proceedings in Hong Kong, but then the Originating Summons in those proceedings did not even name D, who the Husband accepts is a child of the family and who is included in the Hong Kong matrimonial proceedings. In any event, even if D were properly included in the GMO proceedings, this does not assist the Husband’s case as it is unrealistic to suggest that there should be two separate proceedings - one in Hong Kong to deal with the children, and the other in France to deal with divorce and distribution of the matrimonial assets.  Provision for the children is inextricably tied up with the distribution of the matrimonial assets.  It would also be a waste of the parties’ resources for litigation to be conducted on two fronts.

43. It may be that the judge has placed more weight on the issue of the children than other factors.  I can well see the force of the Husband’s argument that the parties had barely settled in Hong Kong and that France is the more appropriate forum to deal with their matrimonial affairs.  It is highly material in my view that this couple - who lived wherever the Husband’s work took him - chose to have a civil marriage in France (even though there had been another ceremony earlier in Indonesia where they were then living), chose to have their child born in France so that she could have French nationality, chose to acquire a property in Paris, and chose to deposit the proceeds of their house in Belgium into a bank account in France.  There was also an application by the Wife to obtain French nationality for herself.  These all point to France being their “home port”, even though they did not live in France as such, and returned only for their child’s birth followed by the occasional holiday.  These factors in my mind would weigh more heavily than the brief time the parties have lived in Hong Kong - with which the Husband’s connection was due entirely to his work commitments (which have proved abortive), and the Wife’s connection was entirely dependent on that of the Husband. 

44. However it has not been disputed that Hong Kong does have jurisdiction, and it is well-established that the assessment of the weight of relevant factors is essentially a matter for the judge at first instance.  I would not go so far as to say that the judge’s assessment was “plainly wrong” such that the appellate court would interfere with the exercise of his discretion.

45. In any event, even if France were the natural forum, in my view the Wife would have succeeded in showing that the choice of France as a forum would deprive her of a legitimate personal or juridical advantage.  Not only is there a possible difference between the jurisdictions regarding the inclusion of gifts as marital assets, what is more important is the situation of D.  In the Hong Kong proceedings, D is included as a child of the family and the Wife may well have substantial claims against the Husband regarding D’s maintenance.  In the French proceedings, D is not referred to at all, as under French law, the Husband has no rights to her (see affidavit of Amelie de la Morandiere, para. 28(b)).  The question must follow whether the Husband has any responsibilities for her.

46. When faced with this difficulty, counsel for the Husband said after taking instructions that the Husband is prepared to include D in the French proceedings.  However there is no evidence that under French law D would be provided for as a child of the family, or that the French court would have jurisdiction to deal with D’s maintenance.  Under Hong Kong law, jurisdiction cannot be vested on a tribunal by consent of the parties only.  There is no evidence that French law is different.

Order

47. For the reasons set out above, I considered that the appeal should be dismissed.  As for costs, we were told that the parties’ costs below have been paid from the parties’ joint account.  However this is an appeal, and I take the view that the usual rule for costs of an appeal should be followed, i.e. the Husband having failed in his appeal, he should pay the Wife’s costs.  Counsel for the Husband not objecting, there will be a certificate for two counsel.  

Hon Kwan JA:

48. I have had the benefit of reading in draft the reasons for judgment given by Cheung JA and Yuen JA.

49. I agree with the reasons of Cheung JA that it has not been established that Hong Kong is not the appropriate forum but France is the more appropriate forum for these proceedings. In any event, this is an appeal from the exercise of discretion of Hartmann JA. I agree with Yuen JA it could not be said that the judge was plainly in error in the weighing of relevant factors to warrant intervention with the exercise of his discretion.

50. I fully agree with Yuen JA that even if France were the more appropriate forum, the court would not have granted a stay of these proceedings in Hong Kong as to do so would deprive the Wife of a legitimate personal or juridical advantage.

51. I agree with the costs order proposed by Yuen JA for this appeal.