KKM v. KWKS t WKS AND OTHERS

CACV 9/2004

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 9 OF 2004

(ON APPEAL FROM FCMC 5641 OF 2001 )

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JUDGMENT

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Hon.  Yeung JA:

1.  I agree with the judgment of Yuen JA.  The appeal is dismissed with a costs order nisi against the Wife.

Hon. Yuen JA:

2.  This is an appeal from a judgment of Judge Bruno Chan given on 6 August 2003 after a hearing which took 27 days between January and July 2003. 

Application before the judge

3.  The hearing was of an application by the Petitioner (“the Husband”) under s.17 Matrimonial Proceedings and Property Ordinance Cap. 192 to set aside dispositions made by the Respondent (“the Wife”) of two businesses. 

Effect of s.17 MPPO

4.  The effect of s.17 MPPO is that where there are proceedings for financial relief, a disposition (other than one made for valuable consideration to a party acting in good faith and without notice) taking place less than 3 years before an application for financial relief is made and which has the consequence of defeating such an application, is presumed to have been made with the intention of defeating such an application.

Relevant dates

5.  In the present case, the Husband presented a petition for divorce in September 2000 which included an application for ancillary relief.  The Wife’s dispositions were made in December 2000 and June 2001.  This was not known to the Husband.  The Husband made an application for maintenance pending suit in April 2002.  In an affirmation made in May 2002 in opposition to that application, the Wife disclosed the dispositions - which were made for nil consideration to her relations, in one case to her brother Wang Jian Zhong (“the brother”) and in the other to her daughters Elaine Kwan Ha Tan and Janelle Kwan Ha Yan (“the daughters”).   

6.  As a result of that disclosure, the Husband applied to set aside the dispositions.  It was common ground that the presumption under s.17 MPPO applied and the issue before the judge was whether the Wife could rebut it.

The dispositions

7.  The two businesses were respectively as follows:

(1)	Regent Home for the Elderly (“Regent”)
-	This business commenced in 1996.
-	The Wife and the brother were registered as partners, but the judge found that the brother in fact had no interest in the business (paras. 32 - 38).
-	In December 2000, the Wife in her own words “transferred the business to [the brother] for nothing ...” (Aff. 18/5/02, para. 55).
-	The brother then incorporated the business as Regent Home for the Elderly Ltd., a company in which he held 99.98% of the shares, the other shares being held by the daughters.
-	However in June and August 2002 respectively, i.e. after the s.17 application was made, the brother transferred his shares to Sha Xiuzhen (沙秀貞) and the daughters transferred their shares to 陳琳瑛 (“Sha and Chan”), apparently both mainland residents.
-	I will set out below what has become of this business since the hearing before the judge.
(2)	Sze Toy Home for the Aged Ltd (“ST”);
-	This business commenced in 1987.
-	The Wife and the Husband were registered as partners.
-	In June 2001, the Wife apparently asked the daughters to “take over the business” (Aff. 18/5/02, para. 58) and the daughters then incorporated it as Sze Toy Home for the Aged Ltd., a company in which they hold virtually all the shares.

Wife’s case to rebut the presumption

8.  The Wife sought to rebut the presumption by alleging that she disposed of her interest in Regent because:

(1)	the Husband was disturbing the running of the business by inciting former employees to commence proceedings against the business and by making complaints to the authorities including the Labour Department and the Social Welfare Department;
(2)	because of (1), residents were leaving and the business was not profitable;
(3)	the Wife found it physically and mentally difficult to carry on running the business;
(4)	she was unable to find a buyer, and so transferred the business to the brother so that he could close it down.

9.  As for ST, the Wife sought to rebut the presumption by alleging that she disposed of her interest in ST because:

(1)	she found it physically and mentally difficult to carry on running the business;
(2)	the Husband was sabotaging the business by taking money from ST’s bank accounts;
(3)	it would cost too much to close the business down.

Judge’s findings

10.  In his comprehensive judgment which took some 65 pages, the judge carefully considered the Wife’s evidence (some parts of which he accepted) but he did not accept that the reasons advanced by the Wife, either singly or cumulatively, caused her to dispose of her interests in the businesses. 

11.  In the case of Regent, the judge concluded (para. 90):

“	the Wife had failed and failed miserably to rebut the presumption that she had transferred the business of Regent to her brother with the intention to defeat the Husband’s claim for ancillary relief against her in these proceedings”.

In the case of ST, he concluded (para. 107):

“	the transfer to her daughters was one way to put it out of the reach of the Husband while retaining control”.

12.  The judge noted that the Wife had not informed the Husband of the transfers until long after the event (in the case of Regent, after nearly 1½ years and in the case of ST, nearly 1 year) and that she had continued to be involved in the running of the business (paras. 88-9), the brother and the daughters being resident overseas in Australia and the United States respectively (para. 110).

13.  The judge also found that the timing of the dispositions, the Wife’s relationship with the transferees, and other actions on her part showed that she did have the intention of defeating the Husband’s claims for financial relief (para. 112).

Judge’s orders

14.  Accordingly on 6 August 2003, the judge made the following orders:        

(1)	the transfer by the [Wife] to Sze Toy Home for the Aged Ltd of the business of the Sze Toy Home for the Aged on 8 June 2001 be set aside;
(2)	the transfer by the [Wife] and [the brother] to Regent Home for the Elderly Ltd of the business of Regent Home for the Elderly on 15 December 2000 be set aside;
(3)	the transfer by [the brother and the daughters] of their respective shares and interests in Regent Home for the Elderly Ltd to Sha and Chan on 22 June 2002 and 31 August 2002 respectively be set aside.

He also ordered the Wife to pay the bulk of the costs of the application.

15.  After the judge made his orders, the parties reconvened for the purpose of agreeing consequential directions for the working out of the orders, but no agreement was reached.

Application for stay

16.  The Wife applied for a stay of execution of the judge’s orders.  The application was first made to the judge who refused the application.

17.  The Wife then applied ex parte to a single judge of this court for a stay, amongst other orders.  She made an affirmation in support on 24 December 2003 in which she referred to the Husband’s summons for an order that she resume management of Regent and said (para. 54):

“

There is not a single shred of evidence of mismanagement on the part of Regent Ltd.  There is simply no urgency to have the Business to be transferred to me now, nor will the Petitioner suffer any prejudice if the matter is to be decided later.  The best and the most commercially sensible policy to adopt would in fact be to retain the status quo, and to not disrupt the management of Regent Ltd, as this is important to maintain the profitability (or whatever there is left of it) and therefore the maximum pool in the family asset (assuming but without admitting to be the case that I and/or Kwan still have interest in the business) for the imminent ancillary relief”. (Emphasis added).

18.  On that assurance that the maintenance of the status quo at Regent would maintain profitability for the benefit of the family assets, Woo V-P granted a stay of execution on 6 January 2004. 

Cessation of business of Regent

19.  It was a little surprising therefore for this court to be told by counsel for the Wife on the first day of the appeal that the business of Regent had ceased in 2003.  Although the Annual Returns of the company have been filed up to 15 December 2004 and the company’s status at the Companies Registry is still recorded as “live”, the cessation of business (at least at the original premises, a sizeable operation taking up 2 floors of a building) was confirmed by photographs produced to us showing that the premises, which also serve as the company’s registered office, were vacant.

20.  This led to the question whether the Wife’s appeal in relation to the Regent business would not be academic.  Counsel for the Wife was unable to say why it would not be, save for a possible impact on the costs order below.

Appeal

- Absence of intervenors 

21.  Before I deal with the points raised on appeal, it is necessary to first record the position of the intervenors.

22.  It would be noted from the judge’s orders (which have been reproduced at para. 14 above) that orders were made affecting the intervenors.  However the Wife had not served the Notice of Appeal on any of them. 

23.  The absence of the intervenors caused us some concern at the commencement of the appeal, but eventually we were prepared to proceed, first because the Wife sought only to overturn the judge’s orders affecting her (i.e. the 1^st and 2^nd orders made by the judge,  reproduced in para. 14 above); and secondly, because the intervenors’ respective positions were shown to be as follows:

(a)	the daughters are aware of and have expressed their support for the Wife’s appeal;
(b)	the brother had failed to appear at the hearing before the judge and so was unlikely to be interested in the appeal;
(c)	Sha and Chan had also failed to appear at the hearing before the judge and so were unlikely to be interested in the appeal, especially now that Regent had ceased business;
(d)	as for Regent Home for the Elderly Ltd, at this court’s direction, a notification of the hearing of the appeal was served at the (vacant) registered office during the first day of the appeal;
(e)	Sze Toy Home for the Aged Ltd is controlled by the daughters who as I have said are aware of and have expressed their support for the appeal.

- Broad points on appeal

24.  On appeal, counsel for the Wife advanced 3 broad points.

(1)	The Wife sought leave from this court to adduce fresh evidence consisting of 4 categories of documents relating to:
	(a)	her investments in the PRC;
	(b)	criminal charges laid against the Husband after the judgment;
	(c)	the Social Welfare Department’s policy regarding “natural wastage” at homes for the elderly;
	(d)	a Partnership Agreement between the Wife and the brother.
(2)	The Husband had in his affirmation of 7 August 2002 filed in support of the s.17 application exhibited documents which the Wife alleges are false, and since the date of the judgment he has been charged by the police with perjury.  Although the judge had been told before the hearing that the police were investigating the Wife’s allegations, he did not adjourn the hearing pending the outcome of investigations.  The Wife’s  further complaint is that the judge did not in his judgment expressly disclaim reliance on the disputed evidence, and on the contrary took the Husband’s evidence into account generally.  Accordingly, the Wife argues, the judge’s orders should be set aside as the judgment had been obtained by fraud and a re-trial should be ordered.
(3)	The judge was wrong to refuse to admit into evidence an affirmation of the Wife exhibiting a valuation report of each of the businesses.

25.  At the hearing of the appeal, all were content to deal with the new documents de bene esse, and points (2) and (3) were argued first before the arguments concerning the fresh evidence.  I shall discuss the points in the same order. 

Discussion on point (2) - the alleged false evidence

Judge’s discretion to proceed

26.  First, it was a matter clearly within the judge’s discretion whether to proceed with the s.17 application or to adjourn the hearing pending police investigations into the Wife’s allegations of false documents.  An appellate court rarely interferes with the exercise of a judge’s discretion on a matter such as this and Mr C.Y. Li, counsel for the Wife, wisely did not press the argument.

Judge’s approach to Wife’s case

27.  Secondly, I deal with the argument that the judge should have “approached [the Husband’s] evidence with circumspection and made findings on them insofar as they impinge on [the Wife’s] evidence”. 

28.  In the present case, the judge was more than once made aware by the Wife of her allegations of the falsity of the Husband’s evidence and the fact that the police had commenced investigations (to be contrasted with the situations in Meek v Fleming [1961] 2 QB 366 or McCann v Parsons (1954) 93 CLR 418).

29.  It is evident from the judgment that the approach the judge took - with respect, wisely - was to analyse the Wife’s own case for its inherent weaknesses (e.g. the brother’s failure to attend court), inconsistencies (e.g. the Wife’s evidence of equal profit-sharing with the brother, contradicted by her evidence during cross-examination of ‘sub-contracting’ for a lump sum payment) and improbabilities (e.g. imposing the burden of a business on her daughters who were young and had no business experience).

30.  The judge also tested the Wife’s case against the objective evidence (e.g. the number of Social Welfare Department raids) and considered why objective evidence that could have been produced was not (e.g. medical evidence to support her allegation that she was unable physically or mentally to carry on the business).  The focal point throughout was on the Wife’s case, with little need for reference to the Husband’s evidence. 

Not necessary to determine irrelevant evidence

31.  The judge did not make specific findings one way or the other concerning the disputed evidence.  In my view he was entitled not to do so because whether a judge needs to make findings on the authenticity or falsity of disputed evidence must depend on the degree of relevance of that evidence to the proceedings. 

32.  It is necessary to consider again the nature of the proceedings.  In s.17 proceedings, the issue is whether there had been a disposition with the intention of defeating an application for financial relief.  It was common ground that the Wife had in fact made the dispositions when she was aware of the application for financial relief, for nil consideration, to close relations resident overseas with no experience in the business.  It was also undisputed that she made them at a time that caused the presumption to apply.  It was for her to persuade the judge that despite all that, she had made the dispositions without the intention to defeat the Husband’s application.  In this respect, the judge set out the factors that impressed him most (para. 112):

“

all her actions in respect of the dispositions aforesaid including the timing of the transfers, her close relationship with all the transferees, her deliberate concealment of the transfers from the Husband, her withdrawal of money from personal and business accounts and her cancellation of all the autopay arrangements were for one reason and one reason only: to put all her assets out of the reach of the Husband so that he would not be able to proceed with his financial claims against her in the event of their divorce”.

33.  On those objective facts, with the Wife’s case beset by inconsistencies and improbabilities, there was more than enough material for the judge to decide that she had failed to rebut the presumption. 

34.  It was not necessary for the judge to consider the disputed evidence and to determine its authenticity or falsity, because the disputed evidence related in the main to the Husband’s assertion of his contribution to the businesses and was thus of no or peripheral relevance to the issue before the judge. 

Alleged forged documents

35.  The three exhibited documents that the Husband has been accused of falsifying and for which he has been charged with perjury are “KKM-24”, “KKM-25” and “KKM-49”.  The first exhibit is a letter from Regent written in the Husband’s hand and addressed to the Labour Department.  We have not even been referred to its contents.  The only difference between the parties is whether it was signed by him or by the Wife.  The second and third exhibits are application forms from Regent in which the differences comprise of whether the Husband or the Wife was named (and signed) as applicant for exemption.  In both versions, the owners of the business were stated to be the Wife and the brother, in accordance with the business registration.

No use in s.17 proceedings

36.  The judge had explained to the Wife more than once during the hearing and reiterated in his judgment that whether the Husband had made any contribution to the businesses was “not entirely relevant to the issue” (para. 20).  It is thus abundantly clear that the disputed documents would have been of no or very little use to the judge in deciding the s.17 application.  It is not surprising that he did not refer to them at all in his judgment.   

No obligation to expressly disclaim reliance on evidence

37.  As for Mr Li’s argument that if the judge had not relied on the disputed  evidence, he should have said so expressly in the judgment, I do not think that a judge is obliged to do that, nor indeed in my view would such a practice be wise.  A judge explains in his judgment the main matters that he had taken into account when arriving at a decision.  It would pose an impossible burden on him to have to expressly set out in the judgment what he had not taken into account as well.  If it were so, then an accidental exclusion of what he had not taken into account would suggest - by omission - that he had taken it into account, but without disclosing how and to what extent. 

No general credibility issue

38.  Mr Li then sought to rely on a passage in the judgment in which the judge said that “having considered all the facts and evidence before me including hearing and seeing all the parties and witnesses in court, I find the Wife to have failed to rebut the presumption under s.17(3) that she disposed of the business of Regent and Sze Toy with the intention to defeat the Husband’s claim for financial provision”.  Mr Li argued that the disputed documents bolstered the Husband’s allegation that he was involved in the businesses, and so would have had an impact on his credibility on matters relevant to the businesses, such as whether Regent was  profitable.  

39.  I do not think there is anything in this argument.  This is not a situation where, shorn of the disputed evidence, there was no other evidence of the Husband’s involvement in the businesses.  Even on the Wife’s own evidence, as recounted by the judge in his judgment, the Husband had “kept an eye” on the businesses for some 3 years when she was resident in the United States between 1997 and 2000, and she said he had complained to her in January 2000 when she returned to Hong Kong for a visit that he did not want to look after the businesses any more as the work was too hard (para. 19).

40.  Further, there is no indication in the judgment that where there was a dispute depending on pure credibility, the judge had preferred the Husband’s evidence to that of the Wife.  On the contrary, as I have said earlier, the judge approached the Wife’s case by considering its inherent weaknesses, inconsistencies and improbabilities and weighed it against objective evidence.  His judgment included an analysis of the Wife’s character (para. 77), but not the Husband’s. 

Discussion on point (3) - valuation evidence

41.  I then come to the ground of appeal based on the judge’s refusal to allow valuation evidence of the businesses in the form of two reports made by a firm of accountants which were exhibited to an affirmation made by the Wife for which the judge refused leave.

42.  Generally, I would agree that where a party alleges that he had disposed of a business because it was not profitable, and not because he intended to defeat his spouse’s application for financial relief, expert evidence of the valuation of the business may well be relevant and useful to the court.

43.  However, it is a matter of discretion for the judge whether to admit such evidence and in exercising his discretion, a judge is entitled to consider factors such as delay in the production of such evidence, the quality of the evidence and possible prejudice to the other party.

44.  In the present case, the s.17 application had been made in May 2002.  The hearing commenced on 2 January 2003.  It was not until 20 March 2003, 10 months after the s.17 application was made and after 8 days of hearing, that the Wife sought leave to adduce valuation evidence.  This was at a time when some oral evidence had already been given.  No explanation was given for the delay.

45.  Further, a quick look at the reports shows that supplementary reports would probably have to be called for before they could be of much assistance to the court.

46.  Worse still, no attempt was made to provide a copy to the Husband earlier, before the resumed hearing on 20 March 2003, so that he could instruct his own experts.

47.  In these circumstances, the judge was entitled in the exercise of his discretion to say that he saw no good reason to allow the Wife to produce the new affirmation in the middle of the hearing.  He said that if he were to do so, “the petitioner would be put in such a position that will no doubt cause a substantial delay, if not total collapse of this hearing, which had been set down two months ago” (Transcript 20/3/03, p.33).

48.  These are legitimate concerns and I do not consider that this court can interfere with the exercise of the judge’s discretion not to allow the production of the valuation evidence.

Discussion on point (1) - application to adduce fresh evidence

49.  I then come to the application to adduce fresh evidence.  The principles governing the court’s exercise of discretion are well-known.  Where there has been a hearing on the merits, fresh evidence will generally not be admitted on appeal unless the three conditions set out in Ladd v Marshall [1954] 1 WLR 1489 are satisfied:

(1)	it must be shown that the evidence could not have been obtained with reasonable diligence for use at the hearing;
(2)	the evidence must be such that, if given, it would probably have an important influence on the result of the case, though it need not be decisive;
(3)	the evidence must be such as is presumably to be believed, or in other words, it must be apparently credible though it need not be incontrovertible.

However, if the evidence relates to matters which have occurred only after the hearing, the court has a discretion to admit such evidence, although the power is used sparingly with due regard to the need for finality in litigation (Hong Kong Civil Procedure 2006, §59/10/15).

50.  The fresh evidence that the Wife is seeking to adduce fall into 4 categories, relating respectively to:

(a)	her investments in the PRC;
(b)	criminal charges laid against the Husband after the judgment;
(c)	the Social Welfare Department’s policy regarding “natural wastage” at homes for the elderly;
(d)	a Partnership Agreement between the Wife and the brother.

51.  I shall deal first with category (b) as it is different in nature from the other categories.  

(b) Documents relating to criminal charges

52.  In respect of (b), I accept that the laying of criminal charges and the letter from the police regarding another document relating to the management of the business occurred only after the hearing and thus the relevant documents (“WKS-28” and “WKS-29”) fall outside the type of documents governed by Ladd v Marshall. 

53.  Even so, the primary consideration must be one of relevance.  I have discussed earlier why I think the judge was right to consider the allegations of false documents pertaining to the Husband’s contribution to the businesses to be of little or no relevance to the s.17 application.  The new documents serve the same (irrelevant) purpose.  Accordingly I do not see why this court should exercise its discretion to permit the production of those documents.

54.  Along the same lines are the documents the Wife has alleged to be the genuine versions of “KKM-24”, “KKM-25” and “KKM-49”.  These documents have been produced as “WKS-25.3a”.  Since these documents were obviously in existence before the hearing, they would fall to be governed by Ladd v Marshall.  But even if we were to disregard Ladd v Marshall, they are within the same category of documents as the police charges and the police letter, and in my view, should similarly not be allowed.

(a) Investments in the PRC

55.  Unlike category (b), documents pertaining to the Wife’s investments in the PRC were relevant to the issue before the judge.  The Wife’s case was that the Regent business was not profitable and that was one of the reasons why she did not wish to carry on with it.  On the other hand, there was undisputed evidence that the parties had accumulated considerable wealth over the years.  As recorded by the judge (para. 62) the Wife’s evidence was that she had

“

withdrawn more than $5 million, of which $1.3 million odd represented the majority of the total deposits of the inmates of both businesses, and that during her stay in the US between 1997 and 2000, she did receive substantial remittances in US dollars from the Husband but she insists that the bulk of her wealth or that of the family including those remittances in fact came from her investments in the stock and property market in China instead of from the income of the 2 businesses”.  (Emphasis added).

56.  However the Wife failed to produce any documents in support of her allegations that the wealth came from her investments in the stock and property markets in China.  This was one of the reasons, although not the only reason, the judge gave for rejecting her allegation (para. 67).

57.  The Wife is now seeking leave to produce a number of documents relating to investments in the PRC.  These comprise “WKS-31” - documents made in 1994-1996 relating to 4 units in 天驕大廈 a building in Shanghai; “WKS-32” - two investment agreements with 上海萬成置業有限公司   a company in Shanghai; and “WKS-33” - a certificate from the Shanghai Department of Technology and a certificate from the State Federal Tax Bureau.

58.  Since all these documents were in existence at the time of the hearing, the first hurdle for the Wife must be to satisfy the first condition of Ladd v Marshall - to show that the evidence could not have been obtained with reasonable diligence for use at the hearing.

59.  In her affirmation in support of her application to produce these documents on appeal (Aff. 24/12/03), the Wife first said that she had made “some brief enquiries on them [her investments] during the general preparation of my evidence, but they were really part of my personal financial history, and so I did not then consider them relevant at all to the transfers of the 2 businesses” (para. 27). 

60.  That cannot be right.  As recorded by the judge at para. 62 of the judgment, it was the Wife who had brought the PRC investments into the s.17 proceedings, because she claimed it was not the businesses, but the PRC investments, that provided the bulk of the wealth.

Shanghai building units

61.  The Wife then said in her affirmation (Aff. 24/12/03) that she had, as part of her preparation for the proceedings before the judge, made enquiries with the solicitors in Hong Kong who had represented her in acquiring the Shanghai building units.  She claimed however that initially the solicitors were unable to help because she could not provide the name of the building or the development in Shanghai (para. 28), and it was only after the judgment below that the solicitors did “many lengthy gratuitous searches” and recovered the documents (para. 30).

62.  I find it very difficult to accept that the Wife was unable to provide the necessary information regarding the name of the Shanghai building where she had acquired 4 units.  The documents now produced (“WKS-31”) include 2 receipts in Chinese which refer to the name of that building 天驕大廈 and which were signed by the Wife herself.  It is not as if she had invested in a development with only a lot number, which might slip one’s mind over the course of the years.

63.  Besides, the documents showed that the Wife was not the only investor.  At para. 31 of her affirmation (Aff. 24/12/03), the Wife says that “I have blotted the names and personal data of my friends who purchased units 9C and 9D for me for privacy reasons”.  Even if the Wife did forget the name of the building, she could have asked these friends.  Yet no explanation is given why she did not do so, in order to obtain these documents from the solicitors before the hearing.

64.  In my view, the Wife has not shown that she had used reasonable diligence in her attempts to obtain these documents before the hearing and has not satisfied the first condition of Ladd v Marshall.

Shanghai investment agreements and ancillary certificates

65.  Then there are the investment agreements (“WKS-32”) with 上海萬成置業有限公司, a company in Shanghai and two certificates from official authorities (“WKS-33”) which the Wife says evidences the existence of that company.  These certificates are ancillary to the investment agreements and stand or fall together. 

66.  The Wife says that the investment with this company “did yield a large profit” (Aff. 24/12/03, para. 32).  If so, then one would have thought she would have been anxious to produce these to the judge to support her allegation as to the source of wealth.  She does not however say when she started trying to get these documents.

67.  The investment agreements printed in Chinese were signed by the Wife herself.  She has not said that she had forgotten the name of the company (and if she had indeed reaped a “large profit” from her investment with it, it would be difficult to accept that she would forget its name).  She has said simply that she had not been able to contact its legal representative because he had changed his telephone number.  There is no explanation why she could not simply have contacted the company itself.  This is yet another unanswered question arising from her affirmation which leads to the conclusion that she has not satisfied the first condition in Ladd v Marshall.

(c) Social Welfare Department policy on “natural wastage”

68.  The same consideration applies to the document from Sze Toy Home for the Aged Ltd to the Social Welfare Department dated 21 June 2002 (“WKS-36”) which the Wife says supports her allegation at the hearing that she could not simply close down the business of Regent because of the “natural wastage” policy of the Social Welfare Department, an allegation which was rejected by the judge (para. 86).

69.  Again, the Wife falls foul of the first requirement of Ladd v Marshall.  If the Social Welfare Department did have such a policy, one would have thought it the simplest thing in the world for the Wife to obtain confirmation of it from the department itself for use at the hearing.  One cannot help but point out that the s.17 application was made in May 2002 and the Husband’s affirmation in support was filed in August 2002.  The hearing itself spanned a period of 7 months, commencing in January and ending in July 2003.  There was ample time for the Wife to obtain documentary confirmation of that policy if she had used reasonable diligence.

(d) Partnership Agreement with brother

70.  The same consideration also applies to the copy of the Partnership Agreement with the brother (“WKS-35”) and the ancillary request for it (“WKS-34”).  The Partnership Agreement was obtained from the Immigration Department with whom it had been lodged in support of the brother’s application for a work permit in Hong Kong. 

71.  No satisfactory explanation has been given by the Wife why she did not apply earlier to that department for a copy.  She says that she knew that the document existed but she had lost her copy (Aff. 24/12/03, para. 38).   However when she was asked by her previous solicitors whether there was a written Partnership Agreement, she says she was confused and thought they meant one prepared by solicitors, and accordingly told them there was no written agreement.

72.  That does not however explain her evidence at the hearing when asked why there was no partnership agreement with the brother for Regent, as opposed to Sze Toy.  Her evidence, as recorded by the judge in his judgment, was not that she did have one (albeit not one drawn up by solicitors) which she had lost, but that there was no agreement because it was not necessary as they were siblings (para. 33). 

73.  This is quite apart from concerns arising from the apparent inconsistency between the contents of the Partnership Agreement regarding profit-sharing and the Wife’s evidence at the hearing about a “sub-contracting” agreement in exchange for a lump sum payment to the brother.

74.  Be that as it may, if the Wife had provided consistent, proper instructions to her legal advisers before or at the hearing, they may well have been able to obtain a copy from the Immigration Department by the time of the hearing.  As such, I do not consider that the Wife has shown that the evidence could not have been obtained with reasonable diligence for use at the hearing.

Order

75.  For the reasons which I have set out above, I would refuse the application to adduce fresh evidence and I would dismiss the appeal with an order nisi that the Wife (Appellant) bear the costs of the appeal.

Hon. Sakhrani J.:

76.  I agree.