Z,SN also known as K,SN v. K,VSF

CAMP 84/2019

[2019] HKCA 840

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

MISCELLANEOUS PROCEEDINGS NO 84 OF 2019

(ON AN INTENDED APPEAL FROM FCMC NO 9107 OF 2018)

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JUDGMENT

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Hon Poon JA (giving the Judgment of the Court) :

1.  By a judgment dated 12 March 2019 (“the Judgment”), Her Honour Judge Melloy (“the Judge”) allowed the summons of the respondent (husband) dated 19 September 2018, dismissing the divorce petition filed by the petitioner (wife) on 18 July 2018 on the ground that the petitioner did not have jurisdiction to issue divorce proceedings in Hong Kong. The petitioner’s application for leave to appeal against the Judgment was refused on 25 April 2019.  The petitioner now renews the leave application to this Court by way of a summons dated 9 May 2019.  Having considered the parties’ submissions, we take the view that the renewed application can be disposed of on paper without an oral hearing.  We now hand down our judgment.

BACKGROUND

2.  The respondent is an American citizen who was born in Virginia, USA in 1977.  His father was a US diplomat who was required to work in different countries from time to time.  The respondent thus travelled around a lot and had lived in Taiwan, Beijing, Singapore and Hong Kong in his childhood.  In 1992, the respondent’s father left the US diplomatic services and took up employment in Hong Kong.  The respondent followed the family and stayed in Hong Kong for three years until he went back to USA for university education in 1995.   In 1999, he returned to Hong Kong after graduating from Babson College, USA.  In 2001, the respondent moved to live and work in Shanghai. He started cohabitating with the petitioner in or about 2010 and they married on 18 March 2012.  The marriage was registered in Hong Kong but the traditional wedding ceremony and banquet was held in Shanghai in a significant scale.   

3.  The petitioner was born and lived in China.  She went to USA for her tertiary education and worked there for 4 years after graduating.  She then returned to Shanghai and worked in her family’s business of a Hong Kong listed company.  The petitioner has stayed in Shanghai ever since.  The parties have two young children, a daughter and a son who are now 5 and 2 ½ years old.  Although the children hold US passports, they have only ever lived and educated in Shanghai. 

4.  By both parties’ accounts, the marriage was short lived and unhappy.  In or about August 2017, the respondent left the former matrimonial home in Shanghai and came to Hong Kong, which is where both his parents and his sister currently reside.  

5.  After the breakdown of the marriage, the petitioner had attempted to issue proceedings for divorce in Shanghai on three separate occasions, but the respondent had refused to participate in the proceedings each and every time.  On 18 July 2018, the petitioner issued a divorce petition in Hong Kong.  She pleaded in the petition that the respondent was domiciled in Hong Kong at the date of petition.  On 20 September 2018, the respondent took out a summons to dismiss the divorce petition for lack of jurisdiction.  On 30 November 2018, the petitioner amended the petition to further plead that the respondent also has a substantial connection with Hong Kong by reason of the following matters :

(1)  The respondent has a Hong Kong identity card and a Hong Kong driving licence.

(2)  The respondent has huge deposits in various Hong Kong bank accounts and he is paid his salary and/or commission fee to his Hong Kong bank accounts.  He also has investment accounts in Hong Kong.

(3)  The respondent has his own insurance policies in Hong Kong.

(4)  The respondent conducts business in Hong Kong through an offshore company.

(5)  The respondent came to Hong Kong for at least two to four times a year during the marriage and he would come to Hong Kong whenever there were any big changes in his life such as graduation, marriage, and separation.  After he left the matrimonial home in Shanghai in August 2017, he has spent a substantial amount (around 60% - 70%) of time in Hong Kong up to the date of divorce petition.

(6)  The respondent’s parents and sister have resided in Hong Kong since 2008 and he has his own bedroom in his parents’ home with his personal properties placed there.

(7)  The respondent registered the marriage with the petitioner in Hong Kong.

THE JUDGMENT BELOW 

6.  In dismissing the petitioner’s divorce petition and allowing the respondent’s summons, the Judge found that although the respondent’s domicile was Hong Kong when his parents permanently settled in Hong Kong, this was changed in 2001 when the respondent move to Shanghai and lived there for 16 years where he married twice to women with strong local ties and he conducted his business.  Although the respondent left Shanghai in August 2017, for reasons that were in dispute, his domicile has not changed by virtue of him being in Hong Kong temporarily. The Judge then went on to consider the respondent’s evidence that even though he returned to Hong Kong since August 2017, he had never intended to make Hong Kong his permanent home; that he had been travelling to other places to pursuit his next business ventures and that since 1 January 2019, he moved to live in Thailand and to conduct business ventures there.   After due consideration of the evidence, the Judge found that the respondent cannot be said to be domiciled in Hong Kong at the time of the divorce petition : see [19] to [23] of the Judgment. 

7.  On the issue of substantial connection, having considered all the factors relied on by the petitioner as referred at [5] of the Judgment, the Judge found that the respondent merely has a connection with Hong Kong and it is not sufficient to confer substantial connection for the following reasons :

(a)  Following ZC v CN [2014] 5 HKLRD 43, the mere fact that the respondent holds a Hong Kong identity card (not a permanent identity card) and a driving licence is not sufficient to confer a substantial connection as of right : see [29] and [37] of the Judgment.   Similarly, the fact that the respondent holds bank accounts/ investment accounts in Hong Kong and took out a medical insurance policy with a Hong Kong insurance company would not assist in showing a substantial connection with the Territory : see [30] to [32] of the Judgment.

(b)  There was no evidence to suggest that the respondent was paid his salary and/or commission fee to his Hong Kong bank account nor he had conducted business in Hong Kong through an offshore company : see [33] of the Judgment.

(c)  It was not established from the respondent’s post separation travel record that he had spent 60% - 70% of his time in Hong Kong.  The record merely showed that the respondent had been in and out of Hong Kong on a regular basis and tended to support his case that he was looking for other business opportunities in the region : see [34] of the Judgment.

(d)  The other factors like the respondent’s family living in Hong Kong; the retaining of a bedroom in his parents’ home; the registration of marriage in Hong Kong and his visits to Hong Kong whenever big events happened in his life merely showed that the respondent had some sort of family connection with Hong Kong : see [35] to [36] of the Judgment.

8.  In refusing the petitioner’s application for leave to appeal, the Judge rejected the petitioner’s argument on the wrongful shift of burden in proving a change of domicile of choice which was a new argument not raised at the hearing.  In any event, the Judge found no evidence of “settled intent” on the part of the respondent with Hong Kong to establish a case on domicile.  The Judge also rejected the petitioner’s argument that she had adopted an over restrictive interpretation on “substantial connection”.  In consequence, the Judge found that none of the grounds of the petitioner’s intended appeal was reasonably arguable.  

DISCUSSION

9.  Leave to appeal shall not be granted under section 63A of the District Court Ordinance, Cap 336, unless the Court of Appeal is satisfied that the appeal has a reasonable prospect of success or there is some other reason in the interest of justice that the appeal should be heard.  The petitioner bears the burden of satisfying this Court that her appeal has a reasonable prospect of success which means an appeal with prospects that are more than fanciful but which do not need to be shown to be probable : SMSE v KL [2009] 4 HKLRD 125 at [17].

10.  The petitioner sought to raise 2 grounds of appeal which is the same as put before the Judge, namely:

(1)  The Judge misdirected on the burden of proving a change of domicile of choice and wrongly held that the respondent had changed his domicile to Shanghai.  

(2)  The Judge wrongly found that the respondent has no substantial connection with Hong Kong.  

11.  On Ground 1, the petitioner contended that once the Judge found and established that the respondent changed his domicile from United States to Hong Kong when he followed his parents to come to Hong Kong as a child, the burden should be shifted to the respondent to prove that he had changed his domicile thereafter.  It was a misdirection on law that it was incumbent on the petitioner to establish on balance of probabilities that the respondent had not changed his domicile to Shanghai.

12.  It is trite that the party who wants to invoke the jurisdiction of Hong Kong court in proceedings for divorce under section 3 of the Matrimonial Causes Ordinance (“MCO”), Cap 179, bears the burden to prove jurisdiction does exist.   As rightly stated at [14] of the Judgment, it was not disputed that the petitioner bears the burden to prove her case on domicile.  The petitioner has to satisfy the court that the respondent’s domicile was Hong Kong at the date of petition, not at the point of time when he was a child or at the age of 18 when he acquired the domicile that he had before becoming an adult.  With respect, the petitioner’s argument on the burden of proof is misconceived and plainly unarguable.

13.  The petitioner further complained that the Judge was wrong in finding that the respondent’s domicile changed to Shanghai.  Alternatively, if the respondent’s domicile changed to Shanghai, which was denied by the petitioner, the Judge ought to have found that he had abandoned his Shanghai domicile and re-acquired his Hong Kong domicile when he left Shanghai for good in August 2017 and came to Hong Kong.

14.  It is sufficient for present purpose to state the law on domicile briefly.  The Domicile Ordinance (“DO”), Cap 596, which came into effect on 1 March 2009, has consolidated and reformed the law for determining the domicile of individuals.  Pursuant to section 3 of the DO, every individual has a domicile and where the domicile of an individual is in issue before any court in Hong Kong, that court shall determine the issue in accordance with the law of Hong Kong.  Section 5 of the DO further provides that when an individual becomes an adult, he retains the domicile that he had immediately before he becomes an adult, and subject to certain provisions, an adult acquires a new domicile in a country or territory if:

(a)  he is present there; and

(b)  he intends to make a home there for an indefinite period.

15.  Based on the aforesaid legal provisions, in order to establish the respondent’s domicile was Hong Kong at the date of the petition, the petitioner has to satisfy the court that (i) the respondent was present in Hong Kong and (ii) he intended to make Hong Kong his home for an indefinite period.  The petitioner had failed on both requirements.  The travel record produced by the petitionershowed that the respondent had travelled in and out of Hong Kong frequently after he came back to Hong Kong in August 2017 and he was not even present in Hong Kong when the divorce petition was issued on 18 July 2018. 

16.  On the question of “settled intent”, the Judge rightly referred to the list of factors set out in Y v W [2012] 2 HKC 455, namely: (i) length of residence; (ii) condition of residence: purchased property? leased property? furnished property? hotel? (iii) marriage with a local partner; (iv) whereabouts of the family; (v) business interest; (vi) whereabouts of personal belongings; (vii) whereabouts of property and investments; (viii) the fact of naturalization; (ix) decision made as to the nationality of children; (x) education of children; (xi) membership of clubs or religious associations; (xii) place of work; (xiii) relation between a man and his family.  After considering the ample evidence clearly showing the respondent’s close connection with Shanghai for the long period of stay as set out at [18] of the Judgment, the Judge had found at [20] of the Judgment that the respondent’s domicile changed to Shanghai in 2001.  The Judge went on to examine the respondent’s move from Shanghai to Hong Kong in August 2017.  The evidence showed that the respondent did not stay for any fixed and long period of time in Hong Kong.  The respondent’s case as stated in his affirmation filed shortly before the hearing below, is that he did not have an intention to make Hong Kong his home or residence for an indefinite period and he only stayed here because of the petitioner’s eviction against him from the matrimonial home in Shanghai.  He further declared that he had been travelling to other places in China (except Shanghai), Southeast Asia and the US in pursuit for business opportunity and on 1 January 2019, he left Hong Kong again and move to Thailand to live and conduct business venture there : see [19] and [21] of the Judgment. 

17.  We note that the Judge had carefully reminded herself that the respondent’s affirmation might be criticised as “litigation window dressing”, but as the petitioner chose to proceed the case with an expedited hearing, it was difficult for the court to draw any adverse inference on the respondent’s affirmation evidence without cross-examination of the parties : see [22] of the Judgment.

18.  In the absence of contrary evidence, the Judge came to the view that “the husband cannot be said to be domiciled in Hong Kong” and the petitioner had failed to prove her case on domicile : see [23] of the Judgment.  The Judge was perfectly entitled to reach her conclusion as she did.  For the totality of evidence clearly shows that the respondent could not be regarded as domicile in Hong Kong at the time of the petition.  The petitioner has failed to satisfy us that the Judge was plainly wrong in her evaluation of facts and evidence.  Accordingly, we do not see any basis to disturb the Judge’s findings and conclusion.  Ground 1 is not reasonably arguable.

19.  On Ground 2, the petitioner complained that the Judge was wrong to find that the respondent had no substantial connection with Hong Kong.  The petitioner argued that the Judge gave too much weight to the question of whether there were “matrimonial related factors connecting the respondent to Hong Kong”.  The Judge also failed to find other factors, in particular, the holding of Hong Kong identity card and driving licence by the respondent showed a substantial connection with Hong Kong.

20.  The question whether a party has a substantial connection with Hong Kong under section 3(c) of MCO is a finding of fact for the trial judge.  The Court of Appeal must be satisfied that the trial judge has gone “plainly wrong” in his findings of fact : see ZJW v SY, CACV No 10 of 2017, unreported, 1 December 2017, Part D.

21.  How to determine a “substantial connection” in the context of section 3(c) of MCO is a well-trodden area, as the case law demonstrates. The Judge at [24] – [27] of the Judgment referred to a line of cases on “substantial connection”, including S v S [2006] 3 HKLRD 751, ZC v CN [2014] 5 HKLRD 43 and LCYP v JRK (CACV Nos 98 and 125 of 2015).  Based on the well-established principles derived from the authorities, the Judge adopted the two-stage process: (i) if the respondent has a connection with Hong Kong and (ii) if so, is the connection a substantial one in determining if the respondent had substantial connection with Hong Kong.  The Judge, after carefully evaluating and weighing all the relevant factors, came to the conclusion that the factors merely showed that the respondent had a connection but not a substantial connection with Hong Kong.  The so called “matrimonial-related connecting factors” were raised by the respondent’s counsel in her submissions and was accepted by the Judge as one of the considerations on the matter.  The Judge clearly explained at [39] of the Judgment that :

“ I accepted as argued by Ms Rattigan (counsel for the respondent) that there are no matrimonial related factors connecting [the respondent] to Hong Kong. I have also carefully considered all of the factors relied upon by [the petitioner] as referred to above, both separately and together. Taken separately it is clear that many of the factors have not been considered as sufficient to confer substantial connection in other cases. I also agree that this particular case [the respondent’s] connection to the territory does not seem to be a particularly substantial one. In addition, I have also considered whether, if taken altogether, there can also be said to be a cumulative effect? I think not.”

The Judge was obviously not confining herself to the “matrimonial-related connecting factors” but had taken into account all relevant circumstances on the question of substantial connection. 

22.  The Judge is plainly entitled to reach her conclusions after evaluating the factors and attach such weight to them as she considered appropriate in the overall circumstances of the case. In our view, the Judge’s analysis of evidence was careful, well-supported with evidence and accord with the authorities.  The petitioner has not been able to show any palpable error in either the Judge’s reasoning or conclusion and there is no basis for us to interfere.  Ground 2 is not reasonably arguable.

DISPOSITION

23.  For the reasons set out above, we are not satisfied that the intended appeal has any reasonable prospect of success.   Nor is there any other reason in the interest of justice why the appeal should be heard.  Accordingly, we dismiss the petitioner’s summons dated 9 May 2019.

24.  As the application is wholly without merit, we make an order pursuant to Order 59 rule 2A (8) of the Rules of the High Court, Cap 4A, that no party may under rule 2A (7) request the determination of this Court to be reconsidered at an oral hearing inter partes.

25.  Costs should follow event.  We order the petitioner to pay the costs of the respondent summarily assessed at HK$50,000.