A v. B

HCMC 2/2023

[2025] HKCFI 1596

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MATRIMONIAL CAUSES NO 2 OF 2023

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REASONS FOR DECISION

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A.  INTRODUCTION

1.The ancillary relief trial of this matrimonial case, which was scheduled to start on 9 April 2025 (with 7 other days reserved) (“the AR Trial”), was commenced in the Family Court by the petitioner wife (“W”) in September 2016 against the respondent husband (“H”). It was subsequently transferred to the Court of First Instance by an order dated 28 April 2023.

2.One of the main focus of the AR Trial was the asset management company which H started in                    in         (“AB Limited”) and the offshore fund management company which H set up in             (“CD Limited”). CD Limited together with its subsidiaries (including AB Limited) will be referred to as “the Business” or the “CD Group” herein.

3.All parties had been kept very busy in the 2 months or so before the commencement of the AR Trial. While it was anticipated that only usual directions were required to be given at the Pre-Trial Review scheduled to take place on 10 February 2025, both sides had taken out summons returnable at the PTR:

(1)  H applied for leave to adduce opinion from his own expert on, among other things, the viability of H realising his interest in the Business for the purpose of raising funds for making lump sum payment to W and the impact thereof on the continuing operation and the value of the Business;

(2)  W made an application for specific discovery for documents which she said would be crucial for, inter alia, ascertaining H’s assets.

4.Both applications had been dismissed. One of the factors which this Court had taken into account was delay.

5.Be that as it may, W saw fit to take out yet another very late application for discovery by virtue of a summons filed on 3 April 2025 (“the New Evidence Summons”).

6.This time, she sought leave to adduce 51 items (with a total of 712 pages) of Board Meeting agenda and minutes of a number of companies within the CD Group, alleging that these documents were essential to the AR Trial, in that they were important pieces of evidence which would shed light on a number of matters including:

(1)  The financial state of the companies;

(2)  Dealings between the Group companies and internal evaluations of the Group and the Funds’ prospects;

(3)  Budgets and forecasts of the Group companies;

(4)  H’s remuneration and the distributions which have been made to him;

(5)  The incredibility of H’s 2022 and 2024 Forms E or the account given by him in his narrative affidavits.

7.Those 51 items had been set out in Annexure 1 of the New Evidence Summons.

8.After this Court had heard parties’ submissions on the first day of the trial, leave was granted for W to adduce only 3 documents at the trial. I will set out the reasons of this decision below.

B.  THE APPROACH

9.As far as the approach which this Court should adopt, I have already set out my view in the Decision on W’s application for specific discovery dated 14 March 2025 ([2025] HKCFI 1060) (“the Specific Discovery Decision”), and I do not propose to repeat the same.

10.However, it appeared that W’s legal team did not agree with this Court’s approach set out in the Specific Discovery Decision. It was submitted that:

“23. It is understood that this Court is minded to apply the principles set out in Converge Design and Construction Co Ltd v Mount Kelly International Ltd [2020] HKCFI 2433 at §§2, 9 and the Court’s observation in Chu Hsiao Chiu Alias Chu Tony Chu Hsiao Chiu Alias Chu Hsiao Chiu, Deceased v Ma Jinrui Ma Ming And Another [2020] HKCFI 942 at §18, followed and applied by this Court on W’s unsuccessful application for discovery [2025] HKCFI 1060, 14^th March 2025.

24. We would respectfully observe that the approach in those two cases is not so applicable where the Court is operating in its specialist matrimonial ancillary relief jurisdiction. It is settled, high authority that the Court is here charged with a special quasi-inquisitorial role, quite unlike the ordinary jurisdiction of the High Court in which the Court acts as an arbiter inter partes. The decisions of the Commercial Judge in Converge Design and Coleman J in Chu Hsiao Chiu alias Chu Tony Chu are examples of the Court’s approach to errant parties in its ordinary civil and commercial jurisdiction, in particular under O.24 r.7 RHC.

25. Justice in that ordinary jurisdiction may be meted out by denying a locus poenitentiae to a party guilty of litigation misconduct as in the two commercial authorities above, but that is not so here. In the ancillary relief jurisdiction, the Court of Final Appeal has held that this quasi-inquisitorial role accords primacy to relevance to outcome.

26. See LKW v. DD (2010) 13 HKCFAR 537 at 562, approving Parra v. Parra [2003] 1 FLR 942 at §22:

‘..... The outcome of ancillary relief cases depends upon the exercise of a singularly broad judgment that obviates the need for the investigation of minutes detail and equally the need to make findings on minor issues in dispute. The judicial task was very different from the task of the judge in the civil justice system whose obligation is to make findings on all issues in dispute relevant to outcome. The quasi-inquisitorial role of the judge in ancillary relief of obliges him to investigate issues which he considers relevant to outcome even when not advanced by either party. Equally he is not bound to adopt a conclusion upon which the parties have agreed.’

27. In LKW v. DD at p562, Ribeiro PJ describes this passage as ‘illuminating’.

28. While this may not entirely remove the culpable failure of a party or their lawyers from the AR Court’s consideration, it does not permit the Court to choose to exclude or ignore relevant evidence on those or ‘case management’ grounds. That would amount to a failure to inquire.

29. Our submission is therefore that notwithstanding unusual lateness, this Court should follow the Parra approach as approved in LKW v. DD and grant leave.”

(original emphasis by counsel)

11.With greatest respect, I totally disagree with the submission that the quasi-inquisitorial role of the Court does not permit it to exclude relevant evidence on case management grounds:

(1)  The Rules of the High Court (Cap.4A, Laws of Hong Kong) (“RHC”) are applicable to matrimonial proceedings by virtue of rule 3 of the Matrimonial Causes Rules (Cap.179A). In other words, the underlying objectives as provided under Order 1A thereof such as “to promote a sense of reasonable proportion and procedural economy in the conduct of proceedings”[1] and “to ensure fairness between the parties”[2] are equally applicable to matrimonial proceedings including ancillary relief proceedings;

(2)  For the above reason, the Court managing ancillary relief cases is obliged to manage such cases actively pursuant to Order 1A rule 4 of the RHC, and that would include “fixing timetables or otherwise controlling the progress of the case”[3];

(3)  The Court is given very wide powers as far as case management is concerned, and is empowered to take any step or make any order for the purpose of managing the case and furthering the underlying objectives set out in Order 1A of the RHC[4];

(4)  In Mimi Kar Kee Wong Hung v Raymond Kin Sang Hung (No.2) (2015) 18 HKCFAR 210, Ma CJ had the following to say:

“41. I have already made the point that, at trial, the aspect of the redevelopment of Severn Villa, although vaguely raised, was never pursued by W and that W certainly made no submissions regarding a clawback order. The matter was only raised at the appeal stage in spite of H’s objections.

42. In his judgment, Cheung JA was of the view that where the parties had not raised an issue, this did not prevent the court from doing so of its own motion. Reliance was placed on the decision of the English Court of Appeal in Parra v Parra where Thorpe LJ mentioned the quasi-inquisitorial role of the court in ancillary relief litigation.

43. As H pointed out in his written Case, there are limits as to how far this point can be stretched, particularly in the present case. What it does not mean is that matrimonial litigation is some form of ‘free for all’ where procedural rules and practice, coupled with their rationale,[5] have no application. In matrimonial litigation, I daresay that the court would exercise its quasi-inquisitorial role most acutely where children are concerned, or if one or the other party or both parties suffered from some disadvantage. Where, however, both parties are properly represented (as in the present case where at every stage, H and W have been represented by leading counsel), the court can in almost every case, unless some exceptional circumstances exist, rely on the parties to look after their own interests. It would be quite wrong in such circumstances for the court to second-guess, much less override, the parties’ approach to the litigation, much of it being driven by tactical considerations.”

(emphasis added)

(5)  In Chan Cheung Ming Jacky v Siu Sin Man [2014] 5 HKLRD 89, Lam VP (as Lam PJ then was) had also unequivocally pointed out at [46] that:

“Before we end this judgment, we wish to express some concerns about case management in family proceedings. We understand that a review of the family procedure rules is ongoing. We also understand that there is a heavy caseload in the Family Court. However, even before the implementation of any further changes as a result of the review, as we have tried to explain above, under the existing framework active case management is equally applicable to family proceedings as in other civil proceedings. And we must stress again, at the risk of repetition, parties and their legal representatives owe a positive duty to assist the court in the proper carrying out of its case management function. It is high time that those involved in family proceedings should take a real look at paragraph 16 of PD 15.12.”

12.On the strength of the above legal bases, I have no doubt that the assertion made on behalf of W must be rejected. I maintain my view expressed in the Specific Discovery Decision at [18] that:

“[…] the fact that the Family Court (and the Court of First Instance hearing Matrimonial Cases) having a quasi-inquisitorial role does not mean that the Court has to allow late evidence to be adduced at all costs. In my view, the approaches explained in cases such as Converge Design and Construction Company Limited (supra) and Chu Hsiao-Chiu alias Chu Tony (supra) are equally applicable to such cases.”

13.This is particularly so in the present case because both parties have been legally represented from the commencement of these divorce proceedings at the Family Court. I cannot find any exceptional circumstances described by Ma CJ herein. Undoubtedly, the Court can rely on the parties to look after their own interests.

14.Before I leave this topic, I must deal with some of the arguments made on behalf of W in this regard.

15.Firstly, while W’s counsel accepted that PD15.12 governs these proceedings, it was pointed out that:

“[…] Notably, as these specialist proceedings have their own disclosure and provisions and evidential practice, Order 24 r.7 RHC has been excluded from the list of Rules ‘of general application’ in [PD] 15.12 §9.”[6]

16.With greatest respect, this line of argument is totally misconceived. Paragraph 9 of PD15.12 (which is put under the sub-heading of “New Measures under the Civil Justice Reform”) reads:

“Some of the measures under the Civil Justice Reform are by their nature of general applicability. The following are some of the examples: […]”

17.Order 24 rule 7 of the RHC is not a new measure under the Civil Justice Reform. It is therefore natural that it was not included as one of the examples in the said paragraph in PD15.12.

18.In fact, in the written submissions lodged on behalf of W dated 28 February 2025 in support of her application for specific discovery, it was expressly recognised that Order 24 rule 7 of the RHC is applicable to matrimonial proceedings.

19.Secondly, this Court’s attention was drawn to Chan Cheung Ming Jacky v Siu Sin Man (supra) (a case which dealt with the issue of subpoena), particularly to Lam VP’s reference to the term “ordinary civil trial”. Insofar as it was argued that the Court of Appeal also agreed that the approach to be adopted in matrimonial proceedings must be different from “ordinary civil trial”, I am afraid W’s counsel have taken what Lam VP said out of context. I only have to refer to the followings to demonstrate this point:

“21. Since the introduction of the CJR, the power to grant leave for the issue of subpoena in a case management context has been considered in Big Island Construction (HK) Ltd v Wu Yi Development Co Ltd HCA 1957 of 2005, 29 Jan 2010 (Poon J); upheld on appeal in FBC Construction Co Ltd v Lee Ben [2014] 2 HKLRD 1054 at para 223 and Waddington Ltd v Chan Chun Hoo Thomas CACV 136 of 2013, 19 July 2013. Those were cases decided in the context of ordinary civil trials and the courts emphasised that the proper stage to deal with questions relating to the issue of subpoena for witnesses is at the case management conference.

22. By now, it should be recognised that in the exercise of the power to grant leave to issue a subpoena, at least in respect of late applications, in addition to the matters Mortimer VP alluded to in Li Man York Evelyn v Li Wai Tat Walton, supra., the court must also bear in mind its case management duty.

23. We understand that in family proceedings, including those brought under the GMO, there is as yet no formal rule providing for the holding of case management conference. There is also no rule in such proceedings for the filing of a statement of nature of evidence intended to be adduced (for a witness who is not willing to give a witness statement and may have to be subpoenaed to give evidence) as provided under Order 38 Rule 2A(5) of the Rules of the High Court. But the absence of such rules does not mean that judges in the Family Court do not need to be concerned with case management. Orders 1A and 1B are equally applicable to family proceedings, see Practice Direction 15.12 para 8. Further, paragraph 16 of PD 15.12 provides:

‘In order to provide better case management to Matrimonial Proceedings and Family Proceedings, the Court may, where applicable, apply some of the concepts and provisions contained in Order 25 of the RHC / RDC and any Practice Direction issued in relation to Case Management in Matrimonial Proceedings / Family Proceedings, with necessary modifications.’

24. Thus, if necessary, judges in the Family Court can resort to the powers and provisions in Order 25 and PD 5.2 to fulfil their case management function prescribed by Order 1A Rule 4 as buttressed by the powers set out in Order 1B.”

20.It can therefore be seen that what Lam VP meant was that because the general procedures of matrimonial proceedings are different from those of “ordinary civil trial”, the powers and provisions in the RHC and Practice Directions would have to be applied with modifications.

21.Thirdly, it was further submitted that the Court of Appeal in Chan Cheung Ming Jacky was:

“careful to distinguish Big Island and the civil litigation decisions that follow as being in ‘ordinary civil trials’^. Chu Hsiao-chiu is also such a case.”[7]

22.Insofar as it was submitted that the distinction between ordinary civil litigation and matrimonial proceedings is required because the approach adopted in these 2 types of cases is necessarily different, with respect, such submission is misconceived. As Lam VP pointed out at [25]:

“Subject to two caveats, we are in broad agreement with the observations of Poon J in Big Island Construction (HK) Ltd v Wu Yi Development Co Ltd HCA 1957 of 2005, 29 Jan 2010 paras 2 to 6 on the practice regarding application for leave to issue subpoena in the context of general civil litigation. As we said above, judges and practitioners in Family Court should adopt a similar approach, with necessary modifications having regard to the procedures in the family proceedings.”

C.  DELAY AND PREJUDICE

23.In the circumstances where a party seeks to adduce new evidence at a late stage, one of the important considerations of the Court would be the reason of the delay. In this regard, W explained in her supporting affidavit that this is not an usual “undue delay” application at all because, in a gist:

(1)  Prior to perusing H’s narrative affirmation filed on 10 January 2025, she understood that the disputes as to availability of funds from the Business and as to viability were to be argued on the evidence of the Business SJE and the “so-far-unseen evidence” from H, and that the opinion of H’s own business valuation expert had been superseded. However, H’s narrative affirmation showed that he would still be relying on the opinion of his own expert at the trial. The Board papers were therefore necessary to contradict H’s evidence in this regard, particularly when H had failed to produce the relevant Board papers in support of what he alleged;

(2)  While W was searching for the relevant Board papers in her email account, there were times when the files were corrupted, and as a result she could not access the documents. She had also lost access to her CD email account for several weeks because the company has recently enhanced the security measures;

(3)  The process had been made more difficult and time-consuming because she had not been provided with the Board-approved signed versions of the minutes;

(4)  She had previously encountered difficulties in obtaining documents from H;

(5)  The 2 most recent sets of minutes were unavailable at the time when the narrative evidence was filed;

(6)  It was a long task for W to gather the documents as she was only able to retrieve the relevant Board documents piecemeal from her 2022, 2023 and 2024 emails, and she was simply unable to retrieve these records in time for their orderly inclusion in her reply narrative affidavit of 24 January 2025;

(7)  The process took time because the documents had to be considered and “weeded for relevance”. Such a process had also been delayed because of the 2 other interlocutory applications taken out at the PTR;

(8)  As soon as W had been advised by counsel upon the completion of the documents location process, her solicitors had contacted H’s solicitors on 24 March 2025.

24.Subject to one matter (which I will further discuss below), I was unable to accept the aforesaid explanations:

(1)  From the way H had conducted his case in all these years, I did not think W could really say that she did not know that H would like to argue at the trial that in the event he were required to make a large lump sum payment to her, he would be obliged to take much money from the Business, which in turn would affect the value thereof:

(a)  Senior Counsel for H referred to forced-sale value of the Business in her written submissions lodged for the PTR;

(b)  H insisted to include a number of issues including the effect on viability and valuation of the Business caused by withdrawal of capital from the Business and/or its Funds in the joint instruction letter to the single joint expert;

(c)  After the single joint expert has prepared his 1^st report, H’s solicitors raised 8 questions for the expert to further consider, amongst which the expert was asked to consider the impact of release of cash assets on the viability of the business;

(2)  That being the case, it was not understood why W did not see fit to start locating the Board meeting minutes, etc. much earlier so that she could include the same in her narrative affirmation, or at least to get well prepared so that the same could be attached to her reply affirmation once it was confirmed that the reliance of such materials would be necessary upon her perusal of H’s affirmation. She only had herself to blame for her failure to do so. For this matter, it should be borne in mind that, in relation to all the 26 Board meeting minutes which W sought to produce, she was recorded to have attended all the board meetings concerned. Therefore, she should have a good idea that at least some Board meeting minutes would be helpful to her case (as she claimed) long time ago. Hence, she should have started to search for those documents much earlier;

(3)  One must also remember that the documents which W sought to produce at last minute were dated from December 2021 onwards. In other words, by the time the first set of Board meeting minutes appeared, parties had been engaged in this divorce case for more than 5 years[8]. By then, W was allegedly aware that H had not been forthcoming in terms of disclosure of relevant documents. It should also be apparent that the value of the Business would be one of the battlegrounds herein. These features made it even more obvious that W should have gathered the Board meeting minutes much earlier;

(4)  One must also not lose sight of W’s allegations that parts of her purposes for adducing the new documents were to show the incredibility of H’s 2022 and 2024 Forms E as well as H’s remuneration and distributions received. This further supports my afore-mentioned queries on the timing of W gathering relevant evidence in support of her case;

(5)  Viewed in such a way, the difficulty on the part of W having to locate documents within a short period of time was self-induced and hence would not amount to explanation which this Court would accept. In fact, even her counsel admitted that it was “regrettable […] that she started looking when she did”[9].

25.W’s counsel also referred to the tight timetable since the turn of the year and particularly between the narrative affidavits and trial in their explanation of W’s delay in taking out the present application. As I explained, it is my view that W should not have waited until 2025 before she started to look for evidence in support of her case. Furthermore, it must also be noted that the timetable was fixed at the First Appointment Hearing after due consultation with both parties. W’s legal team knew what the timetable was like long time ago. It was not open to them to blame the timetable now.

26.I therefore took the view that there was inexcusable delay on the part of W to make the present application, at least in relation to items 4 to 51 under Annexure 1 of the New Evidence Summons.

27.Allowing discovery at such a late stage for such a large amount of documents would no doubt cause prejudice to H, as the trial would commence immediately.

28.It was pointed out on behalf of W that H would not be prejudiced as such because H’s solicitors in fact proposed by letter dated 26 March 2025 that the documents sought to be introduced by W be included provided all 4 previous years’ Board documents be added as well. In this regard, H’s counsel explained that:

“The original thinking behind this approach was that if W were permitted to refer to select board minutes at the last-minute without knowing her lines of argument, the least unacceptable option would have been to have a complete set of signed/approved minutes adduced out of prudence to protect H against W advancing contentions which might take the materials in Bundle I.1 out of context.”[10]

29.I could understand why the said proposal had been made by H’s legal team back then. But in any event, there was no agreement reached because W refused to accept H’s proposal. Further, the situation had become totally different. If an agreement was reached by then, there were still 2 weeks left before trial. There would still be sometime before the commencement of the trial.

30.It was also submitted that those new documents were actually H’s documents which H should have disclosed himself much earlier, and that given they were his documents, he should suffer no prejudice even if they were included.

31.The first point is that, given W’s attendance at the relevant Board meetings, if the Board meeting minutes were really so important, she should have produced them herself or started looking for them for the purpose of such production much earlier as I explained above.

32.Further, even if those documents might be regarded as H’s documents, what was undisputed was that H did not seek to adduce them himself at the trial. The last-minute introduction by W of those documents would have impact on how H’s legal team would run his case and on the approach of the W’s cross-examination, which would start on Day 2 of the AR Trial. This must also be a form of prejudice.

33.This Court had of course not lost sight of the requirement that the Court should balance all circumstances when it exercises its discretion. In this regard, W had laid great emphasis on the very high probative value of the new evidence. However, the extreme lateness of the application and the imminent commencement of the trial must weigh heavily in such an exercise.

34.For the reasons above, W’s application to adduce items 4 to 51 of Annexure 1 of her New Evidence Summons[11] should be dismissed on the ground of delay alone.

35.As mentioned, I accepted only one of the explanations given by W, namely, that some documents (items 1 – 3 of Annexure 1 of the New Evidence Summons) were unavailable at the time when the narrative evidence was filed because they were only created in March 2025.

36.H indicated that, for that reason, he had no objection for W to adduce those 3 items at the trial.

D.  DISPOSITION

37.I therefore granted leave for W to adduce items 1 – 3 of Annexure 1 of the New Evidence Summons, and dismissed the rest of the application.

E.  COSTS

38.Costs of the New Evidence Summons was reserved.

Mr Nigel Kat SC leading Ms Madeleine Booth, instructed by Withers, for the petitioner

Ms Mairead Rattigan SC leading Mr Adrian Kwan, instructed by Haldanes, for the respondent