Once matza has been completely baked, the flour in it loses the capacity to become ḥametz, even if it is soaked in water for a long time. An indication that the matza is fully baked is that a crust has formed on its surface and that it breaks cleanly, with no threads of unbaked dough extending from it. Since completely baked matza cannot become ḥametz, it is permitted to soak it in soup. An elderly or sick person who cannot eat dry matza on the Seder night may soften matza by soaking it in water (SA 461:4 and below 16:29). Likewise, if the matza was milled into flour, it is permitted to knead it with water; one need not worry about it becoming ḥametz because, as mentioned, once it has been thoroughly baked, it cannot (SA 463:3). Therefore, one may bake cakes from the five species of grain during Pesaḥ or cook various dishes – such as gefilte fish and matza balls – that contain matza meal.
Yet there are some who avoid soaking fully baked matza in water, lest some of the flour was not kneaded properly and remained unbaked, and soaking the matza will cause the unbaked dough to become ḥametz. They likewise fear that some flour may have stuck to the matza after the baking process, and if the matza is soaked in water, this flour will become ḥametz. There is yet another reason to be strict about matza meal: an unlearned person might confuse matza meal with flour and end up violating the prohibition of ḥametz on Pesaḥ. Ḥasidim accept this stringency and refrain from eating soaked matza, or “gebrokts.”
The poskim, however, nearly unanimously agree that one need not be stringent, since it can be assumed that the kneading was thorough, leaving no flour unkneaded or unbaked. This is the custom of Sephardim and non-Ḥasidic Ashkenazim. Today, even some Jews from Ḥasidic families are lenient because the common practice is to bake thin matzot, so there is no longer any concern that some of the flour was not properly baked. Likewise, there is no concern that flour may have gotten stuck to the matza, since matza bakeries are careful to separate the area where flour is handled from the area where the matza comes out of the oven. Although technically eating soaked matza is permitted le-khatḥila, one should not disparage those who practice this stringency.
In practice, many people of Ḥasidic descent no longer observe the stringency of gebrokts because today’s matzot are very thin and our ovens are very strong. If one’s father was lenient in this matter, one need not perform hatarat nedarim, even if he is from a Ḥasidic family. However, if one’s father was stringent and he wants to be lenient, he should perform hatarat nedarim and make sure not to insult his father.
The details of practicing the stringency of gebrokts: Those who do not eat gebrokts may be lenient when it comes to children or sick people, since soaking matza is not considered making ḥametz on Pesaḥ. Additionally, Jews in the Diaspora who keep gebrokts customarily make matza balls on the eighth day of Pesaḥ to show that matza sheruya is not fully prohibited. They prepare the matza balls on Ḥol Ha-mo’ed but do not otherwise eat off the dishes used to prepare the gebrokts. She’arim Metzuyanim Be-halakha 113:7 allows using kelim in which matza was soaked. Responsa Kinyan Torah Be-halakha 2:87 rules stringently that one may not even soak matza for children or sick people.
As far as soaking matza in fruit juice, SAH (op cit.) states that one need not be stringent, and indeed the widespread custom is to soak matza in wine and spread various spreads on matza. Kinyan Torah Be-halakha 2:87 is stringent regarding this as well. (See Piskei Teshuvot 458:5-7.) Sha’arei Teshuva 460:10 states that even those who are strict about gebrokts may dip matza in water and eat it immediately, before it could conceivably become ḥametz. Those who are stringent about dipping matza in fruit juice are stringent about this as well.