This case from the Court of Final Appeal is the leading case on forum and also brought into law in Hong Kong the principles contained in the English Supreme Court case of Radmacher v Granatino [2010] concerning the enforceability of prenuptial agreements in Hong Kong. The Court of Appeal had refused the husband’s application for a stay of the wife’s petition for divorce in Hong Kong on the basis that Germany was the more appropriate forum. The parties were both German nationals and the husband had significant assets in Germany and his business was based there. They were married in Hong Kong in 2008 and during their short marriage they lived there. The wife, who had lived and worked in Hong Kong since 1997, commenced divorce proceedings in Hong Kong in October 2010. The husband commenced proceedings in Germany in December 2010 and sought a stay of the Hong Kong proceedings. Prior to the marriage they executed a pre-nuptial agreement under German law, and they also executed a post-nuptial separation agreement just before the wife’s divorce petition was issued.
The Court of Final Appeal upheld the Court of Appeal’s ruling on forum. Where jurisdiction is founded in the Hong Kong court as of right, the party seeking the stay has to establish that there is another available forum which is clearly or distinctly more appropriate than the Hong Kong forum. On the facts of this case, the husband was unable to prove Germany was more appropriate and therefore his application for a stay failed, and additionally, even if the husband had succeeded on this point, the court would not have allowed it on the basis that the wife may suffer a juridical disadvantage which could not be alleviated by an application under Part IIA MPPO. The existence of a nuptial agreement was plainly a factor in the exercise of discretion to stay on the ground of forum non conveniens as the agreement may result in a grave injustice to one party should the agreement be enforced.
Originally, the trial judge had taken the view that the balance of fairness between the parties would be achieved by staying the Hong Kong proceedings, without prejudice to W’s right to make an application under the provisions in Part IIA of the MPPO. However, as observed by the Court of Appeal, the conditions for an application under Part IIA were stringent: the applicant must obtain leave to bring the application; the court must consider whether Hong Kong was an appropriate venue and then the applicant must persuade the court to make an order. The court must further consider a number of factors including the connection of the parties to Hong Kong. By staying the Hong Kong proceedings, the Hong Kong court would have already considered that Germany was the more appropriate forum where substantial justice could be given to the wife and therefore she may not be able to satisfy the requirements in the leave application.
The Court of Final Appeal agreed with the Court of Appeal that the wife would have suffered a juridical disadvantage if the stay were granted and the balance of fairness could not be achieved by an application under Part IIA of the MPPO.
Guidance was given in respect of the enforceability of nuptial agreements. The Court of Final Appeal held that there was no reason to distinguish between pre-nuptial agreements and post-nuptial agreements. The court should give effect to an agreement which was freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to the agreement. The parties could not, by agreement, oust the jurisdiction of the court. While the court will give appropriate weight to such an agreement, it is for the court to determine the appropriate ancillary relief when a marriage came to an end. The relevance of the parties’ German choice of law was that the parties clearly demonstrated an intention that that pre-nuptial agreement should be binding on them.