Lcjwy v. Lcks

FCMC 16239/2013

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO.16239 OF 2013

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DECISION
(SPECIFIC DISCOVERY)

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1.There are several matters before me but the main disputes are essentially about the Petitioner Wife’s 2 discovery summons respectively against the Respondent Husband and his parents the 1^st and 2^nd  Interveners for information and documents relevant to the forthcoming trial in August 2015 of the preliminary issue over the beneficial ownership of certain properties including companies legally held by the Husband but which he claims to be on trust for the Interveners and hence should be excluded from the Wife’s claims for ancillary relief upon the dissolution of their 10 odd years marriage.

2.The remaining matter is the Husband’s summons against the Wife for production of copies of various bank documents and for her to answer his 3^rd Questionnaire, of which I understand had been resolved by the time of the hearing but the Husband wishes to seek costs against her for that summons.

Background

3.The Husband is now aged 39, and the Wife 38. Both come from wealthy local banking families and were married on 30^th November 2002 with 2 daughters now aged 9 and 8. The Husband is a solicitor and a consultant of a law firm but works mainly in his family’s business, while the Wife has been a housewife throughout the marriage. As for the other background information relevant to the applications now before me, I propose to adopt as follows most of the Chronology of Events attached as Appendix B to the Wife’s Skeleton Argument, the accuracy of which I understand to be of no serious issue except perhaps some small discrepancies as to some of the dates mentioned therein:

4.It is against this background of the Husband’s family and the parties’ marriage that now brings me to their divorce proceedings which were commenced on 12^th November 2013 when the Wife filed for divorce against the Husband based on his unreasonable behaviour and sought custody of both daughters and general ancillary relief for herself the daughters, with a 1^st Appointment for both CDR and FDR fixed for hearing on 7^th April 2014.

5.Meanwhile the parties were directed to file and exchange their Form E which then triggered off what can be described as a whole series of extensive and very often contentious discovery applications leading to the ones now before me.

6.In his Form E filed on 27^th February 2014 [A1/50] the Husband disclosed a monthly income in excess of HK$280,000 and a net value of his assets of about HK$32 million, but he also revealed that the following assets under his name are in fact held on trust for either of his parents and hence not included in his net value:

(a) his one share in GW Investment Ltd which holds the parties’ matrimonial home at Po Garden Property of which he valued at HK$43 million is on trust for his father;

(b) his legal title of the London Property which he valued at GBP 2 million is on trust for his father;

(c) his 2 shares (50%) in HF Consultants is held on trust for his father;

(d) his one share in WS Ltd is held on trust for his mother;

(e) his one share (50%) in GC Ltd is held in trust for his mother;

(f) Various bank accounts and securities account of total value in excess of HK$8 million under his name are held on trust for either of his parents.  

7.With these assets valued at least HK$77 million and probably more taking into account of those lots of land held by GC Ltd, and in the absence of any express declaration of trust for any of them, it is not surprising that the Wife takes issue with all of these alleged trusts, and her discovery applications almost immediately jumped into full gear starting with a very extensive and comprehensive 28-pages questionnaire [A1/183].

8.In response the Husband on 22^nd April 2014 filed his list of objection to those requests which he found objectionable in particularly those relating to those companies which he allegedly holds on trust and has no beneficial interests save for documentary evidence in support of the trust relationship [A1/240].

9.On 30^th May 2014 the Husband filed his answer to those requests in the Wife’s said questionnaire which he was willing to disclose, together with a supportive affidavit of his mother (1^st Intervener) in which she dealt with those issues over the various companies and assets said to be held by the Husband on trust for either herself or the 2^nd Intervener, which can be summarised essentially as follows:

(a) that the father established I-Trust for the Husband and his sister S as beneficiaries with the mother as the protector of the trust with certain assets held under a trust company known as I-Investment Ltd to secure for their education expenses, and upon their graduation from university the trust was subsequently wound up with the legal and beneficial interests in the trust company vested in the Husband and S equally, which are the only assets given to them by their parents;

(b) that the father developed a neurodegenerative disease in about 1986/1987 which has since left him completely bedridden and to lose his speech and requires round-the-clock medical care;

(c) that the parents divorced in 1999 with an amicable financial settlement, and the mother remarried in 2001;

(d) that the London Property was purchased by the father but put in the name of the Husband as he was then studying in UK and that it was for the family’s use;

(e) that the Regent-on-the-Park Property was purchased with a sitting tenant by the mother as an investment for the father through HF Consultants, and that the Husband was later made a shareholder of HC Consultants only for the purpose of learning to manage properties under the mother’s supervision;

(f) that upon the parties’ marriage and when the Regent-on-the-Park Property became vacant and the parties were looking for a place to move, they were allowed to reside that property by paying a monthly sum of HK$12,500 for its use and to pay for its renovation and other expenses;

(g) that upon the sale of the said property the Husband was paid HK$1 million out of the sale proceeds as reimbursement of the renovation expenses, with the rest paid to the father for his own use including funding the purchase of the Merton Property;

(h) that the Po Garden Property was also purchased as an investment for the father through GW Investment and similarly the Husband and S were made shareholders of the company to learn to manage properties, and that when the Husband needed a bigger home for his family upon the birth of his elder daughter, the parties were allowed to move into this property on similar conditions as before for the Husband to be responsible for all outgoing expenses;

(i) that GC Ltd was formed by the parents for purchasing agricultural and grassland in the New Territories as long term investments in anticipation of future government’s development in those rural areas, and the mother’s transfer of her shareholding to the Husband on trust for her to explore into development potentials and the feasibility of purchasing further neighbouring land, but the company has never generated any income;

(j) that the mother had from time to time over the years asked the Husband to manage and invest her own monies in various joint bank accounts with him including a fund management contract in which she had contributed an initial sum of HK$10 million for him to manage and invest for her.

10.On 21^st July 2014 the Wife issued the discovery summons now before me against the Husband [A2/346], and when it became clear that the application would be opposed and that those assets alleged to be held by the Husband on trust for his parents would be disputed by the Wife, the parents issued a summons on 28^th November 2014 [A2/472] for leave to intervene in the parties’ ancillary relief proceedings and for the determination of the issue of whether those assets identified in Annexure A as Disputed Assets attached to their summons are held by the Husband on trust for either of them, which is the subject of the forthcoming trial of the preliminary issue in August 2015.

11.On 11^th December 2014 upon granting leave to the parents to join in the parties’ financial disputes as Interveners, I also directed that the beneficial ownership of the Disputed Assets be first determined as a preliminary issue which as noted above has since been set down for trial for 5 days commencing on 12^th August 2015.

12.Meanwhile the Wife also issued another discovery summons on 16^th March 2015 [A2/542], this time against the Interveners and which was also opposed, while the Husband also issued his own discovery application against the Wife [A2/570], both of which were subsequently consolidated with the Wife’s earlier discovery application for argument before me which took place on 22^nd May and 4^th June 2015, during which Ms Corinne Remedios appeared for the Wife, with Mr Jeremy Chan for the Husband, and Mr Abraham Chan with Ms Bonnie Cheng for both Interveners.

13.Before proceeding to consider the 3 applications, it would be relevant to first set out the applicable law and principles to the disputes now before me.

Applicable Legal Principles

14.The law on disclosure is well established, that is it must be relevant to the matters in issue, as it was held in B v B (Matrimonial Proceedings: Discovery) [1979] 1 All ER 801 when Dunn J summarised the law relating to discovery in ancillary relief applications at p811:

“I will conclude the part of my judgment by summarising my conclusion as to law.

(1) A party to a suit must disclose all the documents in his possession, custody or power which are relevant to the matters in issue. The court has discretion whether or not to order him to make such disclosure, and also has discretion whether or not to order him to produce the documents for inspection by the other party or the court.

(2) The documents of a company are in the legal possession of the company. If they are or have been in the actual physical possession of a director who is a party to litigation they must be disclosed by that director, if relevant to the litigation, even though he holds them as servant or agent of the company in his capacity as an officer of the company.

(3) Whether or not documents of a company are in the power of a director who is a party to the litigation is a question of fact in each case. “Power” in this context means “the enforceable right to inspect or obtain possession or control of the document”. If the company is the alter ego of such a director so that he has unfettered control of the company’s affairs, he must disclose and produce all relevant documents in the possession of the company.

(4) Where relevant documents in the possession of a company are disclosed by a director as being in his custody or power, the court has a discretion whether or not to order production of them.

(5) The discretion is a judicial discretion, and in exercising it the court will have regard to all the circumstances. The court will balance the relevance and importance of the documents and the hardship likely to be caused to the wife by non-production against any prejudice to the husband and third parties likely to be caused by production. It has not hitherto been the practice of the court to order production of company documents to which the board of directors objects on affidavit, provided that the court is satisfied that the objection is not contrived for the purpose of frustrating the powers of the court. The court will not in exercise of its discretion order parties to do that which they have no power to do. The court will not order production unless it is satisfied that production is necessary either for disposing fairly of the issues between the parties or for saving costs.”   

15.His Lordship also made the following observations on relevancy in the context of financial proceedings in matrimonial cases at p809:

“It is another feature of such proceedings that one party, usually the wife, is in a situation quite different from that of ordinary litigants. In general terms, she may know more than anyone else about the husband’s financial position: she will know at first hand of the standard of living of the family during the marriage; she will know about the furnishing and equipment of the matrimonial home, and of the physical possession of the husband, and perhaps the appropriate amount of cash kept in the house. She may also know, from conversation with the husband in the privacy of a matrimonial home, the general sources of his wealth and how he is able to maintain the standard of living that he does. But she is unlikely to know the details of such sources or precise figures, and it is for the reason that discovery now plays such an important part in financial proceedings in the family division.

Applications for such discover cannot be described as “fishing” for information, as they might be in other divisions. The wife is entitled to go “fishing” in the Family Division within the limits of the law and practice.”

16.The preliminary issues to be tried in August 2015 for which this application for discovery is related to is of course not strictly speaking ancillary relief proceedings mentioned by His Lordship, and is rather a ‘chancery action’ for determining ownership of properties involving third parties, but ultimately for the statutory purpose of ascertaining and identifying the financial resources of each of the Husband and the Wife for their ancillary relief applications, which is the first step in the section 7 exercise laid down by the Court of Final Appeal in LKW v DD [2010] 13 HKCFAR 537.

17.Furthermore, it would also be relevant to refer to the legal principles concerning such a property dispute stated by the UK Supreme Court in Jones v Kernott [2011] UKSC 53, [2012] 1 AC 776 and recently summarised by Mostyn J in Bhura v Bhura & Others [2014] EWHC 727 at §8:

“The applicable legal principles concerning a property dispute such as this are tolerably clear and … are as follows:

If there is an express declaration of beneficial interests then that is, almost invariably, the end of the matter. Such an express declaration can only be displaced if it has been procured by fraudulent conduct …

If there is no express agreement about the beneficial interests then there is likely to be (at least) a tacit understanding. This is hardly surprising as one would expect that when people enter into what may very well be the most important economic transaction in their lives – buying a home – they would have a pretty clear understanding of who owned what share of it. In determining whether there was such a tacit understanding, and if so what it was, the court will look at all the evidence holistically and will examine the whole course of the parties’ conduct in relation to the property.

…”

18.Henceforth in the exercise of my discretion whether to order disclosure and/or production of those documents sought by the Wife in this application, I am to bear all these principles in mind so as to enable the court at the forthcoming trial of the preliminary issue to look at all the evidence holistically and to examine the whole course of the parties’ conduct in relation to these Disputed Assets. I shall now turn to consider the discovery summons now before me

Wife’s Discovery Summons against Husband & Parents

19.The details of the disclosure sought by the Wife against the Husband [A2/346] and his parents [A2/542] are respectively in Appendix A1 & A2 of her Skeleton Argument, and in broad terms she seeks the following discovery:

(1) bank statements of Husband’s bank accounts:

(a) Wing Hang Bank Account #757XXXXXX

(b) Bank of East Asia Account #0155XXXXXXXXXX

(c) DBS Vickers (HK) Ltd Account #325XXXX

(d) Chong Hing Bank Private Bank Account #256XXXXXXXXX

(2) list of assets of following companies:

(a) GW Investment Ltd which owns the 2nd matrimonial home in which the Husband is a director and 33% shareholder;

(b) HF Consultants Ltd which owned the 1st matrimonial home and currently holds the Merton in which the Husband is a director and 50% shareholder;

(3) the management accounts, list of assets, tax returns of GC Ltd which holds agricultural lands in New Territories in which the Husband is a director and 50% shareholder;

(4) lists of assets and financial statements of I-Investment Ltd of which the Husband is a director and 50% shareholder;

(5) lists of assets of the Husband’s parents at the time of their divorce and their ancillary relief settlement or order.

20.As noted above some of the documents sought by the Wife have since been provided by either the Husband and/or his parents, and that the disclosure sought has now been narrowed to those in the Tables attached as Appendix A, and as she no longer at this stage pursue disclosure relating to WS Ltd nor discovery before 2010, or in relation to I-Investment Ltd, while the list of assets of both GW Investment and HF Consultants were confirmed and resolved at the hearing, essentially only those documents concerning GC Ltd under items 13 – 16 of Appendix A1 against the Husband and similar items 17 – 21 of Appendix A2 against his parents, as well as their divorce settlement and/or order are still at issue.  

21.The Husband’s position regarding GC Ltd is simple as set out in his original answers [A2/550 – 551]: that the requested information and documents are not relevant to determining the beneficial ownership of the 1 share out of 2 issued shares of the company, and that the proper persons to be asked if at all are the Interveners.

22.Essentially the Interveners’ position regarding GC Ltd is similar, and Mr Abraham Chan further submits on their behalf that the materials sought are in any event unnecessary for the fair just and proportionate resolution of the preliminary issue, such as its management accounts which he argues are not documents that can shed any light on the beneficial ownership over the company’s shares, as the company has no control over or business in what arrangements its registered members may have made to divest themselves of their beneficial interest in the shares.

23.As regard the various requests for the Interveners’ list of their assets prior to their divorce and their divorce settlement or order, Mr Chan submits that they all stem from fevered conjecture that the arrangements in relation to the London Property and GC Ltd were somehow part of their divorce settlement, but of which he argues that there is not a sliver of evidence to support such conjecture of the Wife, other than the assertion that the said arrangements somehow coincided in time with the divorce settlement.

24.This is far too weak and remote, he submits, a basis to justify what will be a draconian and intrusive order for the disclosure of the Interveners’ most private and confidential arrangements on their own finances dating back many years and years prior to the parties’ marriage, and that the requests are all the more improper given the detailed accounts in respect of the London Property and GC Ltd which have already been given by the 1^st Intervener in her affidavit with documentary evidence wherever necessary. This is not a case, Mr Chan submits, of parties seeking to conceal affairs relevant to issues before the court, as both Interveners have been nothing but forthcoming in respect of matters which truly relate to the Preliminary Issue and fair disposal of the proceedings.

25.In reply Ms Remedios for the Wife submits that firstly as the Husband is under a duty to make full and frank disclosure of his financial means for the purpose of the ancillary relief proceedings, hence he should provide full discovery of all assets in his name or legal title so that all the information is made available to the court before the forthcoming hearing to determine whether his assertion of non-ownership is true, as the Wife is also entitled to be provided with such information so that she can take proper advice on whether and if so which of these Disputed assets she seeks to pursue.

26.Ms Remedios further submits that the test of relevancy is also trite, as disclosure must be given of documents which contain information which may, rather than must, either directly or indirectly enable the party requiring disclosure either to advance his own case or to damage the case of his adversary, or which may fairly lead him to a train of enquiry, hence this test is doubly applicable in this case as third party ownership is a ‘chancery’ issue, and in the train of enquiry at least the following questions arise: Was money paid from the disputed accounts to the Husband, or were dividends declared and paid to him, and what were the underlying company assets and were they purchased with assets under the Husband’s control, or sold with proceeds paid to him? Just some of the relevant queries that it is argued that the Wife is entitled to raise.

27.As to the suggestion of ‘fishing’, which seems to be the argument of the Interveners, Ms Remedios argues that in addition to the chancery exercise, a party to Family Proceedings is also in a situation ‘quite different from ordinary litigant’, because whereas he/she may know of the other party’s financial position and the sources of wealth in general terms, he/she may not know the details precisely, which is why discovery plays such an important part in financial proceedings in the Family Court, and as cited in B v B supra, ‘fishing’ in that sense is permitted in matrimonial waters.

28.Above all, Ms Remedios submits, where assets are held in a party’s name, as in this case in the Husband’s, this cannot be “a fishing expedition in the sense of casting a line in the hope that something would be caught. The fish had been identified and the court was endeavouring to spear it”, as it was held in the case of Zakay v Zakay [1998] 3 FCR 35.   

29.That case involved a divorce proceedings in England where the wife made a claim for financial provision for herself and the child of the family against the husband and alleged that he was wilfully suppressing his real assets, and that he was worth millions of pounds including beneficially interested in a group of companies known as Topland with tangible fixed assets of a net book value of almost £50m. A trust company registered in Gibraltar provided trustee services and in such capacity could hold assets directly or indirectly under the terms of settlements established under Gibraltar law. That trust company held certain shares in the husband’s group of companies. By a letter of request issued by the senior district judge of the Family Division in London the assistance of the Supreme Court of Gibraltar was sought to ascertain the true beneficial owner of Topland. The letter of request sought an order that a named officer of the trust company be examined and required to produce documentation on this matter. A judge in Gibraltar made an order as requested. The officer of the trust company applied to the chief justice to set aside the order on the grounds (i) that the information sought was not sufficiently relevant to the English proceedings to give jurisdiction to the court in Gibraltar; (ii) that the documents requested were not sufficiently particularised and that the wife had embarked on a ‘fishing expedition’; and (iii) that the court ought to exercise its discretion to refuse the request from the English court to examine the witness on the ground of confidentiality and public interest.

30.In dismissing the appeal by the Supreme Court of Gibraltar, Schofield CJ said this about the issue of relevance in his judgment:

“I do not think there is any doubt that a request will only be granted in respect of evidence which is relevant to the proceedings it is sought to be tendered in. Section 9 of the Evidence Ordinance reads … In the reference to ‘evidence for the purpose of civil proceedings’ the section obviously means evidence relevant to the issues in civil proceedings. I think the court can assume that a requesting court will only ask for relevant evidence. But what is the court to do in the face of an assertion, as in this case, that the evidence is not relevant to the issues in the proceedings of the requesting court? Here we have a situation where this court should only order an examination if the evidence of the witness and the production of documents by him can be shown to be relevant whereas we will only know the relevance of the evidence and the documents once the examination and production has taken place. Mr Bodey in the English proceedings had to wrestle with a similar problem when considering the respondent’s application to vary an order requiring the respondent to give further and better replies to the petitioner’s questionnaire on discovery. He was specifically dealing with the question of beneficial ownership of the Topland shares. He concluded:

‘In the circumstances, I agree with Mr Mostyn’s submission that the court’s approach should be to look to see whether a prima facie case has been made out that the respondent is or may well be beneficially entitled in the relevant entity. Realistically, I can see no other way in which justice could be achieved between the parties before the court, although obviously in such circumstances great care would have to be used to ensure that the rights of third parties were not adversely affected, or only as little as possible, consistently with getting the necessary documents before the court.’

That seems to be the only practical course this court can take. We must look at all the available evidence and, taking great care to ensure that the rights of third parties are so far as possible protected, determine whether a prima facie case has been made out as to the relevance of the evidence and documents sought.”   

31.As regard the argument on public policy to protect third parties to their confidentiality, Schofield CJ said this:

“The last argument against allowing … order to stand is that in exercising its discretion to allow examination of witnesses on the request of a foreign court these courts ought to be extremely cautious to protect the rights of third parties to their confidentiality. This is so, argues the applicant, particularly when one considers Gibraltar’s position as a finance centre where certain confidential relationships are protected by statute. The petitioner has said that in order to protect third parties she is prepared to submit to an order similar to that made by Mr Bodey in the English discovery proceedings, that if the applicant assets by letter that a document is confidential to a third party and requests limitation of disclosure to only the petitioner’s lawyers, then disclosure should be so limited in the first instance but with liberty to the petitioner to apply to the court for the limitation to be lifted or varied. I must say I am not particularly impressed with the applicant’s response to this, that although he has no doubt that the petitioner’s lawyers will not reveal anything to their client which is produced under a limitation as suggested, nevertheless they are bound to take any knowledge so gained with them and such knowledge may unconsciously run in to any future proceedings in the case. His counter suggestion that the production can be made to the court is unrealistic. No doubt names will be revealed and most probably those names will mean nothing to the court whereas they may have great significance to the lawyers familiar with the case and having had their client’s instructions.

Public policy demands that this court should in proper case give effect to requests from foreign courts. I have been referred by Mr Mostyn to a decision of the Court of Appeal for Jersey, a jurisdiction where similar considerations of confidentiality arise in the context of its position as a finance centre. A similar argument was made in Wadman v Dick [1998] 3 FCR 9. In delivering the judgment of the court, Frossard JA quoted the following passage from the opinion of Lord Goff of Chievely in Re State of Norway’s (Nos 1 and 2) [1990] 1 AC 723, [1989] 1 All ER 745; affg Re State of Norway’s Application (No 1) [1987] QB 433, [1989] 1 All ER 661 and rvsg Re State of Norway’s Application (No 2) [1990] 1 AC 723, [1989] 1 All ER 701:

‘It is accepted on both sides that the question of confidentiality can only be answered by the court undertaking a balancing exercise, weighing on the one hand the public interest in preserving the confidentiality owed by the witness as bankers to their customers, and on the other hand the public interest in the English courts assisting the Norwegian court in obtaining evidence in this country’ (See [1990] 1 AC 723 at 810, [1989] 1 All ER 661 at 762.)

Frossard JA went on ([1998] 3 FCR 9 at 32):

‘We made two observations about this balancing exercise before considering its application in this case. First, every claim to confidentiality to exclude evidence which would or might be relevant is an attempt to limit the court’s ability to get as nearly as possible the truth. One factor to be weighed in the balance, therefore, is the public interest in the power of the courts to investigate fully matters brought before them. The court carrying out the balancing exercise must bear in mind the possibility that respect for a witness’ duty of confidentiality may result in disabling the court from protecting the rights of other parties. We do not believe that the English courts meant to exclude so important and so obvious a factor. It was presumably because of the peculiar features of the State of Norway case that the judges whose words we have quoted did not mention it expressly. Second, it is important to appreciate the part played by public policy in the exercise. It has been submitted to us that we ought to pay particular regard to confidentiality between banker and customer because of the great importance to jersey of its role as an offshore finance centre. In our view, this is not the right approach. The public significance and benefit of the finance industry depend upon considerations (economic, social and even moral) lying right outside the province of a court of law. The basis of the protection of confidentiality between banker and customer is not the public benefit of banking in this sense. It is the law’s recognition that the relation between banker and customer is important for the persons involved on both sides, whose purpose cannot be achieved without confidential communication between them. It is the individual relationship, in which trust is reposed by the one party in the other, which is material. The argument before us transcends that relationship and seeks to import a generalized statement about public policy. The former, not the latter, is the court’s concern.’

With respect, I entirely agree with that passage. In my judgment, the applicant’s concerns regarding the confidentiality of third parties will be met by an amendment to the order of Pizzaello J in the terms suggested by the petitioner.”

32.With respect I too entirely agree with that passage, but let me first say this: In my view any person who elects to place his/her property under the name of another person without any express declaration of its beneficial ownership has or can be said to have given up his/her right to privacy or confidentiality vis-a-vis the other party when there is a dispute with that party over the ownership of the property, in particularly when the dispute arises from the ancillary relief proceedings of the person given the legal title who is under an obligation to make full and frank disclosure of his financial resources to the court and hence cannot refuse disclosure of any information or documents in his name or legal title, so as to enable the court to achieve justice between him and his spouse who may very often not even be present when such legal ownership was created and has no personal knowledge or information thereof, as is the situation of the Wife here.

33.In my judgment the relevancy of the information and documents sought by the Wife against GC Ltd can only be known once production and examination have taken place, and in that situation the only practical course is for the court to look at all the available evidence to determine whether a prima facie case has been made out as to the relevance of evidence and documents.

34.The evidence from the Husband’s mother has indicated that GC Ltd was used by the father to purchase agricultural land and/or grassland in the New Territories in the 1980s as long term investments with the parents each held 1 share, and that in 2001 the mother transferred her 1 share to the Husband allegedly to hold on trust for her as she allegedly wanted him to explore into the development potentials of the investment land and the feasibility to purchase neighbouring land to create better value for the investment [A1/330 – 331].

35.Given the fact that parents had already applied for divorce in 1999 which was just 2 years prior to the mother’s transfer of her share to the Husband, and that according to her their divorce was in fact finalised in the same year with an amicable financial settlement, and given the close proximity in time between the events, I agree that the Wife is entitled to look to see whether the transfer was part of the parents’ financial settlement to gift the share to the Husband, and that legitimate queries may be raised as to why the parents still remained as shareholders of the company or to continue with their investment after their divorce and the mother’s remarriage, or why was it necessary for her to resign as a director under the circumstances? It is my judgment the Wife is entitled to seek the answers to these questions from the company’s documents, and I agree that the evidence indicate that such discovery is relevant to the preliminary issue whether the Husband is the beneficial owner of that share and should be allowed against GC Ltd.

36.The same argument can be made of the Wife’s discovery against the parents’ divorce settlement, as Ms Remedios submits that what the parents said about the ownership and devolution of the Disputed Assets at the time of their own divorce is highly relevant, not least where the allegations of ownership of those assets are that it predated their own divorce, hence the Wife is entitled to their list of assets at the time of their divorce and their ancillary relief order disposing thereof, for which the Wife has given an undertaking to the court that such disclosure be limited only to her legal representatives so as to alleviate the Interveners’ concerns over the privacy or confidentiality of their own divorce.

37.It is undisputed that after the parents divorced in 1999, the following of their assets had been transferred to the Husband:

(a) 1 share in GW Investment in May 1999 giving him 1/3 shareholding in the company which purchased the Po Garden Property 6 months later in November 1999 and later became the parties’ 2^nd matrimonial home in 2005 after the birth of their elder daughter;

(b) 2 shares in HF Consultants in January 2002 giving him 2/3 shareholding in the company which then purchased the Regent on the Park Property in February 2002 which later became the parties’ 1^st matrimonial home upon their marriage in November of the same year, and after it was sold in 2007 part of its sale proceeds were used to pay off the mortgage of the Po Garden Property and to pay the Husband HK$1 million for his contribution towards the renovation of that property.

38.Under those circumstances and in the train of enquiry clearly at least again this question arises: Were those transfers of shares to the Husband part of his parents’ ancillary relief settlement to make financial provisions for their children? The only practical mean to answer that question with certainty is to look at that resultant ancillary relief order, and in my judgment the parents’ concerns regarding their own privacy and the confidentiality of their own divorce can be met by the Wife’s said undertaking or better still by an order limiting that disclosure to her legal advisers only but with liberty to the Wife to apply to the court for this limitation to be lifted or varied.

39.Accordingly and in conclusion I allow the Wife’s discovery applications against the Husband regarding GC Ltd and against the Interveners regarding their ancillary relief order pursuant to their divorce with the limitation referred to above, but not her request for a list of their assets prior to the divorce which I find unnecessary, and accordingly the Wife shall have her costs of both applications respectively against the Husband and the Interveners, which are order nisi to be made absolute at the expiration of 14 days.

Husband’s Summons against Wife

40.I shall now turn to the 3^rd and last matter which is much more straight forward: The Husband’s summons against the Wife for disclosure of certain cheques and/or transfer slips and for her answers to his 3^rd Questionnaire filed on 23^rd March 2015, both of which have by the time of the hearing been complied with by the Wife and hence satisfactorily resolved, and for which the Husband now seeks costs of his summons, to which I see no reason why he should not be entitled and I so order.

41.What remains is my gratitude to counsels for all parties no doubt for their valuable assistance rendered to this court throughout the hearings. 

Ms Corinne Remedios instructed by M/S Withers for the Petitioner.

Mr Jeremy Chan instructed by M/S Chaine, Chow & Barbara Hung for the Respondent.

Mr Abraham Chan and Ms Bonnie Cheng instructed by M/S Sit, Fung, Kwong & Shum for the 1^st and 2^nd Interveners.