HKFC 322
IN THE DISTRICT COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
MATRIMONIAL CAUSES NO 31 OF 2018
Coram: Her Honour Judge Sharon D. Melloy in Chambers (Not Open to the Public)
Date of Hearing: 30 October 2019
Date of Ruling: 13 December 2019
R U L I N G
(Joinder and third party discovery)
1. This matter was last before me on the 25 June 2018. In a Memo handed down by the court on the 28 June 2019, directions were given inter alia with respect to the Respondent husband’s s.17 application and in particular it was directed that he should formally plead his case. In addition to the filing of Points of Claim, Points of Defence and a Reply, the court further directed at paragraph 4 as follows:
4. There shall be a further First Appointment hearing on the 30 October 2019 at 9:30 a.m. The Respondent’s summons dated the 23 May 2019 seeking to join inter alia the Respondent’s father, Mr. RY, as a party to these proceedings shall be adjourned to the same date. Leave is also given for any other potential summonses e.g. for strike out to be adjourned to the same date. For the avoidance of doubt the Respondent’s s. 17 summons dated the 9 November 2018 shall be adjourned to the same date for a callover. Further the hearing of the discovery summons dated the 25 June 2019 shall also be adjourned to the same date and the hearing on the 27/8/2019 be vacated.
2. There has been no application to strike out and consequently this hearing is concerned primarily with a) the Respondent husband’s summons to join the Petitioner’s father, i.e. “the wife’s father” as a third party to these proceedings (i.e. ancillary relief proceedings) and b) the application by the husband for third party discovery against the wife’s father in any event.
3. The summons for joinder is dated the 23 May 2019 and states as follows:
1. The following persons and entities shall be joined to these proceedings:
b. Y, RY, [the wife’s father] being the person who set up the unnamed offshore trust and instructed the transfer of assets formerly in the legal and/or beneficial ownership of the Petitioner, which transfers have been made the subject of an application to set aside under Section 17 of the Matrimonial Proceedings and Property Ordinance (Cap. 192)
4. This summons followed the husband’s s.17 application dated the 9 November 2018 which further states that:
1. The following dispositions in Schedule 1 made by the Petitioner whether by herself, her servants, agents or otherwise, be set aside.
2. In the alternative, but without prejudice to paragraph 1 above, the total amount be “added back” and be treated as being with the Petitioner notionally.
3. All such necessary consequential directions or orders for the purposes of giving effect to paragraphs 1 and 2 above.
5. The dispositions in question primarily concern the transfer of shares from the Petitioner to a number of corporate entities. In addition, there is reference to the transfer of some shares from the wife to her brother, J and reference also to the sale proceeds of an Australian property known as the MP property. It is only in that instance that the husband seeks directly to set aside a disposition – here the transfer of the net sale proceeds from the MP property from the wife to the wife’s father.
6. The second application concerns third party disclosure against the wife’s father in the following terms:
1. Y, RY [the wife’s father] as the Settlor of the NGF Trust, the Enforcer of the Y Family S Trust and as the father of the Petitioner, whom the Petitioner asserted in her Form E had in 2016 instructed the transfers to third parties of the Petitioner’s shareholdings and debts owed to her by family companies (stating that a major restructuring “was done pursuant to my father’s instructions, including many companies which were in my sole name previously do within 28 days answer the questions, provide information and supply copies of all relevant documents and evidence, in respect of or relating to the matters set out in the Schedule annexed hereto:
The schedule attached is a 12-page document seeking extensive discovery, in some instances going back to 2009, and is drafted in extraordinarily wide terms. To that end it is of note that technically this application is made prior to the Financial Dispute Resolution hearing (FDR).
7. The parties have both indicated that they wish to proceed to FDR and that they do not wish the s. 17 summons to be tried as a preliminary issue. However, although the wife is keen to proceed, possibly with the assistance of an experienced professional in a private FDR, the husband repeats that he is unable to proceed further until the issue of discovery has been satisfactorily resolved. In addition, the husband originally asked that the joinder application also be adjourned until after the FDR hearing, but in the meantime he wishes to proceed with the discovery application.
8. In essence, and putting it as simply as possible, it is the husband’s case, inter alia, that the wife legally held a number of shares in a family business and that she then sought to dispose of those shares in order to defeat his claim for ancillary relief. He says that she is an integral part of the family corporate structure, that she held directorships in about 40 related family companies, that she worked for and was paid by this group, and that it also provided certain benefits to her and their family, including club memberships and a driver and other staff. He says she worked for the company and on...