NKYL v. LSP

FCMC 8026 / 2007

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 8026 OF 2007

----------------------------

----------------------------

-------------------------

J U D G M E N T
(Variation of Order)

-------------------------

Introduction

1.  This is an application by the Respondent husband for  variation of the Consent Order dated 3 December 2008.  The application for variation was dated 30 April 2012 but was filed on 3 May 2012 (“Variation Application”).  The Petitioner wife has issued a Judgment Summons on 12 January 2012 to enforce outstanding sum of US$81,100.24 together with further interest, such sum which she says are being due and owing in respect of maintenance and educational expenses together with interest on arrears for the eldest daughter KT under the terms of the Consent Order.

2.  The Respondent filed a further application (“Amendment Application”) on 12 September 2012 which is the day before this hearing seeking amendment of the Variation Application.

3.  As at today’s hearing, there are three matters pending, namely :-

(a)  Petitioner’s Judgment Summons;

(b)  Respondent’s Variation Application; and

(c)  Respondent’s Amendment Application.

4.  In line with the practice, the Petitioner’s Judgment Summons was adjourned to be dealt with after determination of the Respondent’s Variation Application (see C (formerly known as C) v. H, reported in [2012] 3 HKLRD 351).

5.  Mr. Pilbrow, Senior Counsel for the Petitioner, took no issue either on the late filing of the Amendment Application or the amendments sought therein.  Accordingly, leave was granted for the Respondent’s Variation Application be amended and then proceeded forthwith.  There be no Order as to costs of this Amendment Application. 

Background

6.  The parties were married in 1984.  The marriage lasted for 13 years when they separated in April 1997. Somehow, divorce proceedings on the basis of 2 year separation was only filed 10 years later in July 2007.  Decree Nisi was granted on 24 October 2007.  Decree Absolute was granted on 12 December 2008.  There are 3 children of the family who at present are of the age of 20, 18 and 15 and living with the Petitioner in the United States of America.  

7.  Both parties were legally represented at the time of the divorce.  A Consent Order dated 3 December 2008 (“Consent Order”) was granted which contains, inter alia, an undertaking under Recital D which I will refer to below.  Suffice to say is that the parties through their legal representatives entered into a global settlement with the Petitioner receiving a substantial lump sum and periodical payments of maintenance payable annual in advance for each of the 3 children of the family. Furthermore, leave was granted for the 3 children of the family to remain out of the jurisdiction of Hong Kong with the Petitioner who was entrusted with their sole custody, care and control.

The Consent Order

8.  In relation to the terms which the Respondent is seeking variation are Recital D and paragraph 4 of the Consent Order which I now recite as follows :-

“D. The Respondent undertaking to the Court and to the Petitioner

that :-

(i) The Respondent shall be responsible for the children of the family, namely, LKT (xxx), a girl, LKY (xxx), a girl and LKC (xxx), a girl (hereinafter referred to as “the said children”) all the tertiary educational expenses (including but not limited to school fees, tuition fees and expenses for extra curricular activities whether these be provided by the schools or other institutions or by private individuals) and all unexpected medical expenses which are not covered by insurance;

(ii) All the expenses incurred or to be incurred as mentioned in the above Clause D (i) shall be directly settled by the Respondent on or before they are due for payment and in no event be later than 14 days after his receipt of the relevant invoice or demand note; and

(iii) If the Petitioner pays for any relevant bills prior to presentation to the Respondent for payment, she shall be entitled to reimbursement of the same by the Respondent within 30 days upon production of receipts to the Respondent.”

9.  Further, paragraph 4 of the Consent Order provides :

“4. The Respondent do deposit into the children’s accounts

periodical payments for the maintenance of the said children at

the rate of US$4,500.00 per child per month commencing from

the 5^th day of January 2009 until each of the said children

individually attains the age of 18 or completes tertiary education

(bachelor degree), whichever is the later, or further order, such

payment to be paid in advance on an annual basis, in a lump sum

of US$54,000.00 for each of the said children, by depositing by

bank draft to their respective bank accounts as designated by the

Petitioner from time to time.”

The Respondent’s application

10.  The Variation Application (as amended) read as follows.  The intended variation was reflected by those wordings inserted by the Respondent into the original agreed terms which I now recited in italics and underlined.  There are altogether 3 variations sought.

Under Recital D (i) of the Consent Order

“The Respondent shall be responsible for the children of the family,

namely, ………………. all the tertiary educational expenses (including

but not limited to school fees, tuition fees and expenses for extra

curricular activities whether these be provided by the schools or other

institutions or by private individuals) and all unexpected medical

expenses which are not covered by insurance. However, fees for

boarding, meal, excursion trip, and other item expenses which would

reasonably be regarded as having already been covered under

maintenance payment are excluded.”

Under Recital D (iii) of the Consent Order

“If the Petitioner pays for any relevant bills prior to presentation to the

Respondent for payment, she shall be entitled to reimbursement of the

same by the Respondent within 30 days upon production of receipts to

the Respondent. For the avoidance of doubt, the Petitioner will not

be entitled to reimbursement upon production of billing statements or

estimated expenses statements per se.”  

Under Paragraph 4 of the Consent Order

“The Respondent do deposit into the children’s accounts periodical

payments for the maintenance of the said children …………..

until each of the said children individually attains the age of 18 or

completes tertiary education (bachelor degree), whichever is the later,

or further order, such payment to be paid in advance on an annual

basis, in a lump sum of US$54,000 for each of the said children.

Before the children reach the age of 18, such payments will be made

by depositing by bank draft to their respective bank accounts as

designated by the Petitioner from time to time. In relation to LKY

and LKC, as soon as each child reaches the age of 18, the Petitioner

will ask the said child if she is willing to make an affirmation or

affidavit authorizing the Respondent to continue to make payments by

depositing to her bank account as previously designated by the

Petitioner. If so, the Petitioner will provide the Respondent with the

said affirmation or affidavit. If any of the said child is not willing to

make an affirmation or affidavit, the Petitioner will transfer the

entirety of the assets of the said account into a new bank account to be

designated, managed and accessed solely by the child, such transfer to

be verified by the bank. In this case, all payments by the Respondent

will be made by bank draft into the said new account. In relation to

all three children, any request for reimbursement for educational

expenses will be made either by the child herself, or by the Petitioner

with endorsement by the child.”

11.  The Respondent, in his Amendment Application, also sought to induce 2 alternative variations to Paragraph 4 of the Consent Order as to the rate of the periodical payments in the event that he was unsuccessful in varying Recital D (i) as per his Variation Application.  The alternative variations, which I also recited in italics and underlined, read as follows :

(a) “The Respondent do deposit into the children’s accounts periodical

payments for the maintenance of the said children at the rate of

US$4,500.00 per child per month commencing from the 5^th day of

January 2009 until each of the said children individually attains the age

of 18 or completes tertiary education (bachelor degree), whichever is the

later, ……  However, if the child reimburses boarding, meal, excursion

trip, and other item expenses not directly related to education under

Recital (D)(i) of the Order, the rate of periodic payments for

maintenance will be reduced accordingly to take into account the

reduction in the cost for maintenance.”

(b) “The Respondent do deposit into the children’s accounts periodical

payments for the maintenance of the said children at the rate of

US$4,500.00 per child per month commencing from the 5^th day of

January 2009 until each of the said children individually attains the age

of 18; and at the rate of US$2,250 per child per month after the age of

18 until each of the said children completes tertiary education (bachelor

degree).”

12.  The Respondent is a medical practitioner by profession.  There is no issue as to his means and ability in meeting the terms of the Consent Order.  There is no application for variation by the Petitioner.  Accordingly, no updated financial statements (Form E) are required from either party.  It is fair to say the Variation Application (as amended) read in its context is not seeking any kind of downward adjustment of maintenance because of Respondent’s means and ability.  It is rather, in my view, that the Respondent is seeking some kind of modification of the agreed terms.  At the hearing, the Respondent submitted that he would need this Court’s clarification. 

The Respondent’s Grounds of Application

13.  The Respondent filed 2 Affirmations.  The 1^st Affirmation was filed on 3 May 2012 together with the Variation Application.  The 2^nd Affirmation was filed on 12 September 2012 together with the Amendment Application.

14.  The Respondent’s contentions, set out in his two affirmations and submitted at the hearing, can be summarised as follows :-

(a) Eldest child reaching majority age of 18;

(b) Need to protect child’s right’s and interests;

(c) Parties’ intention;

(d) Section 19 of the Matrimonial Proceedings and Property Ordinance, Cap.192 (“MPPO”);

(e) Billing statement rather than payment receipts were given;

(f) Meaning and scope of ‘educational expenses’;

(g) Right to reimbursement and possible ‘double reimbursement’;

(h) Underlying purposes of payments made to be made known.

The Law

15.  The jurisdiction of the Court in applications for variation of maintenance order is under section 11 of the Matrimonial Proceedings and Property Ordinance, Cap.192 (“MPPO”) which provides :

“(1) Where the court has made an order to which this section applies, then,

subject to the provisions of this section, the court shall have power to

vary or discharge the order or to suspend any provision thereof

temporarily and to revive the operation of any provision so suspended.

(2) ………

(3) ..……..

(4) ……….

(5) ……….

(6) ……….

(7) In exercising the powers conferred by this section the court shall have

 regard to all the circumstances of the case, including any change in any

 of the matters to which the court was required to have regard when making the order to which the application relates……..”

16.  The approach of the Court has been summarised in the leading case of AEM v. VFM (Variation of Maintenance) [2008] HKFLR 106 :

“The power to vary a periodical payment order was expressly provided

for by s.11(1) of the MPPO. The modern approach as required by

s.11(7) was for the Court to have regard to all of the circumstances of

the case. It was not required to proceed from the starting point of the

original order but to look at the matter afresh. An increase in the

wealth of the Husband was a relevant factor to be taken into account.

At the same time the basis and effect of the original order were relevant

factors to which the court on variation should pay regard and there

should not be a radical departure from the approach taken by the

parties themselves when they had entered into an agreement embodied

in a consent order”

Issues

17.  It seems to me that the central issue is whether there are any good reasons or basis for the Respondent to ‘modify’ the agreed terms embodied in the Consent Order, in the way which he had done, by adding those words he set out in the Variation Application.  

18.  The answer boils down to whether there has been any material change of circumstances since the Consent Order was granted which necessitate such a modification or, as a fall back argument, whether the circumstances are such that which could not have been foreseen or anticipated by the Respondent when the Consent Order was made.

Discussion

19.  It is trite law that in applications for variation of maintenance, the Court is entitled to consider the matter de novo and to make an award which is fair and reasonable (see Flavell v. Flavell [1997] 1 FLR 353)).   Given the fact that the Variation Application, as I saw it, rests upon modification of the agreed terms of the Consent Order, I will consider each of the Respondent’s contentions I summarised under paragraph 14 of this Judgment and to decide whether those agreed terms ought to be modified in order to best meet the needs of the children.  

Reaching majority age of 18/ Need to protect child’s right’s and interests

20.  The Respondent referred to the eldest child reaching majority of 18 on 23 April 2010.  Thus, the eldest child has the right to manage her own financial affairs independently (see paragraph 4 of 1^st Affirmation).  The eldest child has not been in contact with him except a 7-day visit in February 2010.  He was not given any contact details of this child.  He did not know whether the eldest child had access to the bank account.  He even doubted whether the eldest child knows about the maintenance order which she has a beneficial interest (see paragraph 5 of 1^st Affirmation).

21.  There was filed an Affirmation of the eldest child on 3 September 2012.  She confirmed currently over 18 years of age.  She also confirmed she is well aware of the maintenance order.  She is more than happy to continue to let the Petitioner supervising, including operating and managing, her bank account.  Finally, she deposed it would be against her will to exclude the Petitioner from management of her bank account.

22.  It is obvious that the Respondent, upon seeing the eldest child’s Affirmation, saw fit to seek amendment of his Variation Application (on the day before this hearing) to a more or less similar arrangement for the 2^nd and 3^rd child who has yet to attain majority.  I have recited the intended amendments at paragraph 10 of this Judgment.

23.  In my judgment, contentions (a) and (b) must fail.  The   fact that a person reaching the statutory age of majority would, by law, be bestowed with full capacity and status to enter into all kinds of contractual relationships with others.  This does not necessarily fit into the case that he or she would then have to manage financial affairs independently as the Respondent so contended.  In fact, contention (b) does not sit happily with contention (a).  By saying the eldest child attaining full age having the right of managing her financial affairs independently, it follows naturally and also legally that protection against any invasion, deprivation or infringement of her rights and interests would have to be sought by herself independently since she is of full age.  How could the Respondent contend, on the one hand that ‘the child’ had reached majority but; on the other hand, require him to protect ‘the child’s’ rights and interests ?  By delaying maintenance payment for the eldest child, in my view, seems quite the opposite. 

Parties’ intention

24.  At paragraph 8 of the 1^st Affirmation, the Respondent said he understood it was the parties’ intention at the material time that the maintenance payments would be made directly to the child upon her reaching 18. 

25.  Section 10 of the MPPO provides :

“(1) Subject to subsection (3) –

(a) No order under section 5, 6(a) or 8 shall be made in favour of a child who has attained the age of 18; and

(b) The term for which by virtue of an order under section 5 or 8 any payments are to be made or secured to or for the benefit of a child may begin with the date of the making of an application for the order in question or any later date but shall not extend beyond the date when the child will attain the age of 18. (Amended 69 of 1997 s.26)

(2) (Repealed 69 of 1997 s.26)

(3) The court may make such an order as is mentioned in subsection

(1)(a) in favour of a child who has attained the age of 18 and

may include in an order made under section 5 or 8 in relation to a

child who has not attained that age a provision extending beyond

the date when the child will attain that age the term for which by

virtue of the order any payments are to be made or secured to or

for the benefit of that child, if it appears to the court that –

(a) that child is, or will be, or if such an order or provision were made would be, receiving instruction at an educational establishment or undergoing training for a trade, profession or vocation, whether or not he is also, or will also be in gainful employment; or

(b) there are special circumstances which justify the making of the order or provisions.”

26.  The law is clear. Provided the child is receiving instruction at an educational establishment or undergoing training for a trade, profession or vocation, the maintenance order will be extended beyond the age of 18.  Moreover, the provision of paragraph 4 of the Consent Order as to how designated maintenance payments are to be paid, is also clear and unambiguous and reflecting the parties’ intention.  Such contention of ‘parties’ intention’ now raised by the Respondent is a sham devoid of any merit.

Section 19 of the MPPO, Cap.192

27.  The Respondent referred to this statutory provision in paragraph 5 of his 2^nd Affirmation as being applicable since the eldest child already reached 18.  This section, however, relates to orders on custody and education only.  It does not relate to child’s maintenance or educational expenses.  Such contention simply does not stand.

Billing statements v. Payment receipts ?

28.  The Respondent in paragraph 9 of his 1^st Affirmation referred to Recital D (iii) of the Consent Order which requires ‘receipts’ to be produced for seeking reimbursement.  He was only given billing statements by the Petitioner seeking from him reimbursement of educational expenses. 

29.  It was attached to the Petitioner’s 5^th Affidavit as exhibit no.”NKYL-4” various documents (at pages 91 to 106 of the Hearing Bundle) consists of extract of a Housing Contract printout as to payment instructions and marked “Step 4: Make $650 Prepayment – Coupon Instructions”; copies of cheques issued by the Petitioner along with the related payment stub hand marked with the amount enclosed; billing statements issued under the name of the University where the elder child is studying. 

30.  The University’s billing statements contain the name of the student (i.e. the elder child) along with her university email address, student account number and statement date.  There are column entries on ‘dates’, ‘description’, ‘payments/credits’, ‘charges’ and also boxes at the bottom showing any ‘previous balance’, ‘current charges’, ‘disputed charges’ and ‘amount due’.  There is also a closing date on each of the billing statement.  The layout format is similar to bank statements.  The Petitioner also attached 3 pages (at pages 93, 95 and 101 of the Hearing Bundle) of download from viewing online of the University website about  General Information on transactions activity where one can find out payments made and outstanding dues.  

31.  If one looks at Recital D (iii) of the Consent Order, the meaning and objective are obvious without any need of elaboration.  In essence, it is the Respondent’s undertaking to reimburse the Petitioner for expenses paid by her before seeking the Respondent to repay.  This is clear and simple.  The fact that no receipts were produced would not affect the Petitioner’s entitlement to reimbursement provided there is sufficient proof of payment having been made.  To insist on ‘receipts’ and not accepting any other form of solid proof is, in my view, merely playing a game on words for no constructive purpose if not being ignorant or difficult.  Nowadays and in particular in western countries, even in Hong Kong, on-line payment has become increasingly popular and most of which would not generate a receipt afterwards for obvious reasons, including environmental friendly purposes.  Take a day to day example in Hong Kong, which I am prepared to say no difference overseas, that if a person pays his utility bill on line, there will be no receipts even if the payer demanded for one.  The record or evidence of the payer having made such payment or, for the present purpose and sake of argument, evidence of the payee having received such payment would take the form of either entries in the payer’s bank records or in the next bill issued by the payee.  It would be repugnant to say these are not evidence of payment and only a receipt will do. 

32.  On the same scenario, if payment is made over the counter at the Post Office, the utility bill will be stamp printed at the bottom with the amount tendered and again no separate receipts will be issued afterwards; either by the Post Office as collecting agent or by the utility company.  Would it be of any sense or logic to say the stamp printed bill is not sufficient evidence of payment merely because there are no receipts ? 

33.  Upon review of the billing statements, I am satisfied that  the credit entries within the contents could be accepted as evidence of payment in the same way as receipts do.  I do not accept the Respondent’s views in paragraph 9 of his 1^st Affirmation that one of the purpose of his variation application is to avoid any future doubts and uncertainties.  In my finding, there are no doubts and uncertainties whatsoever had any sense been given to the entries in the billing statements.   As my further observation, had the requirement of ‘receipts’ is a must under Recital D (iii) which is now contended by the Respondent (which I do not agree), it might then be open for further argument on the format of the receipt if one is available; say for instance, whether it needs to be personally signed by the Principal or the Treasurer or whoever in charge, whether it needs the stamp chop of the University, so on and so forth.  I have such further observation because the Respondent indicated that he need to know whether the moneys paid had actually been received by the University.

34.  Thus, I find the Respondent’s intended variation on Recital D (iii) is unfounded.

Meaning and Scope of ‘educational expenses’

35.  The Respondent at paragraph 10 of his 1^st Affirmation said as follows :-

“10. ……The maintenance payment under Paragraph 4 of the Order is

intended to cover all daily living expenses. The ‘educational

expenses’ under Recital D (i) of the Order is intended to cover

expenses other than daily living expenses while the child is

receiving tertiary education which the maintenance payment

(which the child is also receiving at the same time) would not

adequately cover. Boarding, registration and health insurance

fees are already covered under maintenance payment and

therefore such items represent claim for double reimbursement,

and is therefore unreasonable. This issue forms the basis of my

application for the variation item 1.”

36.  Further, at paragraph 6 of the 2^nd Affirmation, the Respondent said :

“6. ………I believe it is unreasonable to claim boarding expenses

under ‘educational expenses’. The maintenance payment under

Paragraph 4 of the Order is intended to cover all daily living

expenses. The ‘educational expenses’ under Recital D (i) of the

Order is intended to cover educational expenses while the child

is receiving tertiary education which the maintenance payment

(which the child is also receiving at the same time) would not

adequately cover. Fees for boarding, meal, excursion trip,

registration and health insurance are already adequately covered

under maintenance payment and therefore such items represent

claim for double reimbursement.”

37.  The term ‘educational expenses’ was not defined anywhere in the Consent Order.   The Respondent in his Variation Application sought to ‘define’ it as excluding boarding, meal, excursion trip and other items expenses which would reasonably be covered by the maintenance payment. 

38.  In the Statement as to Arrangement for Children filed at commencement of the divorce in April 2007, the 3 children of the family were already residing with the Petitioner in the United States of America and by that time respectively attending Grade 9, Grade 6 and Grade 3.  They were of the age of 15, 13 and 10.   When the Consent Order was granted in December 2008, the 3 children had yet to complete their secondary education.   To the very least, the eldest child still had 2 years to go before starting her tertiary education.

39.  In the Petition for divorce, there was attached a Schedule by the name “The relevant terms of the agreement and arrangement agreed by the Petitioner (“the Wife”) and the Respondent (“the Husband”).  This Schedule is a comprehensive one dealing globally with ancillary reliefs and children’s arrangement.  On the latter, there is a reference as follows :-

“(iii) The three children of the family will with leave of the Court

continue to reside with the Wife in the United Stated of America.

Notwithstanding the aforesaid arrangement set out in this

paragraph, the Wife shall have the right to take the three children

of the family to reside in any place in or outside Hong Kong.”

40.  Considering the reference quoted against the factual matrix at the time, it is fair and reasonable to say both parties contemplate the children would continue to reside with the Petitioner and receive their  education anywhere which was found to be suitable.  The parties, through their respective legal advisers, came to the consensus of the need to include an Undertaking by the Respondent as Recital D (i) in the Consent Order on ‘all the tertiary educational expenses’ led to my following observations :-

(a) The Respondent acknowledged and agreed tertiary    

educational expenses should be of substantial sums which

 ought to be separately reimbursed (by way of the

 undertaking since details of yet to be known) whilst the

 secondary educational expenses were known and could be

 covered under the maintenance payments;

(b) The use of the word “all” followed by “the tertiary

educational expenses” connotes that a broad and general

 meaning be given as opposed to any definitive or restrictive

 meaning when tertiary educational expenses are to be

 considered;

(c) The words “including but not limited to…….” which then

 follows amplified that not only those items expressly stated

 in that clause are included.  There are others which have not

been expressly stated are also included.  The meaning is

clear and obvious.

41.  Those words now sought to be added to Recital D (i) are, in my view, exactly in the opposite.  They tend to trim down or restrictively ‘define’ tertiary educational expenses by excluding those named items.  As I have said in paragraph 18 of this Judgment, the modification sought by the Respondent could only be accepted if it can be shown there had been a material change of circumstances since the Consent Order or something not being foreseen or contemplated by the Respondent had happened. 

42.  Clearly and in particular, the Respondent foresaw tertiary educational expenses to be out of the scope of maintenance payments that he had been paying whilst the children were receiving secondary education.  He also undertook to be responsible for allof them.  Thus I see no basis how the Respondent could now retrieve from his undertaking by trying to trim down or restrict the scope of the tertiary educational expenses by excluding various items.    

43.  The Petitioner in her 5^th Affidavit confirmed the distance between the University where the elder child is studying and her place of residence is about 653 km with no less than 9 hours of driving time.  The boarding fees are, in my finding, therefore necessary as an integral part of the tertiary educational expenses.  I agree with the Petitioner.

44.  Further, I am prepared to take judicial notice that it is not uncommon for students even living in the vicinity of University to choose boarding given the convenience of research available at the University.  For the present case, the distance apart in itself already justified the choice of boarding.

45.  Apart from the boarding fees, the Respondent also referred to meals and excursion trip to be excluded from his undertaking on tertiary educational expenses.  However, none of these items can be found within the University billing statement where reimbursement under tertiary educational expenses was being sought. 

46.  At paragraph 10 of the 1^st Affirmation, the Respondent also referred to health insurance fees were already covered under the maintenance payments he was paying and there was ‘double reimbursement’.  First of all, I noted health insurance fees had not been included as part of those named items sought to be excluded in the Variation Application (as amended).   It only came out from the Respondent’s Affirmation.  However, even if it had been so included, it is bound to fail.  The reason being that it can be seen from the entries in the billing statements that there are entries of charges on health insurance but there are also corresponding entries of waiver (see pages 97 & 98; 99; 102 & 103; 104 of the Hearing Bundle).  I noted health insurance fees were included in the Judgment Summons dated 12 January 2012 (at page 63 of the Hearing Bundle).  However, as far as the present Variation Application is concerned, the evidence on the billing statements appears to be no issue of ‘double reimbursement’.  Whether there need to be any amendment to the Judgment Summons in light of this finding is something to be considered by the Petitioner at the Judgment Summons hearing.

47.  Thus, I find against the Respondent as to the meaning and scope of ‘educational expenses’.

Right to reimbursement and possible ‘double reimbursement’

48.  In light of the Affirmation from the eldest daughter, the Respondent in his 2^nd Affirmation at paragraph 4 referred to the 2^nd and 3^rd child that when each of them are coming to age, each of them need to make an affirmation in the same way as the eldest daughter did.   He further added the following :-

“……the children have the right to make decisions in relation to any

request for reimbursement for educational expenses, such requests

should be made either by the child herself or by the Petitioner with

endorsement by the child. This is the basis for my application for

the first amendment of the Application.”

49.  Upon my enquiry, the Respondent elaborated at the hearing what he meant was that had he made reimbursement to the Petitioner for those of the children’s expenses, it could happen that the children might not be aware of it and might request for payments from him again.  It is in this context that he used the term ‘double reimbursement’ again under this heading of contention.  This is different from the same terminology of  ‘double reimbursement’ that he had used when he was referring to him having to reimburse for boarding fees, meals, excursion trips, health insurance premium on the one hand and having to pay maintenance payments on the other hand at the same time.

50.  The Respondent claimed that either the children seek reimbursement directly from him or, if the Petitioner had paid and would like to get the money back from him by way of reimbursement, the Petitioner could only do so with the children’s endorsement.  The reason being that it could happen that the children did not want him (i.e. their Father) to pay but would rather want the Petitioner (i.e. their Mother) to pay the expenses. In which event, the children would not give their endorsement to the Petitioner seeking reimbursement from him.  This is a way to find out whether the children wish their expenses to be borne by their Father. 

51.  Again, the Respondent completely missed the point.  Under the terms of Recital D he has, under the full benefit of legal advice, given his undertaking to the Court and to the Petitioner on reimbursement of children’s expenses.  Accordingly, the Petitioner’s right to reimbursement is not subject to the children’s consent irrespective of whether the children reach majority or whether they would like the Petitioner (i.e. their Mother) to bear the expenses.   As regards the duration of maintenance order for the children subsequent to their coming to age and over 18, I have already dealt with in the preceding paragraphs.   I would only add that in the scenario posed by the Respondent, it could only be handled by the Petitioner (respecting the children’s wishes) not enforcing her right and also the Court’s indulgence.  The Respondent could not simply add a requirement of children’s affirmation or endorsement as some kind of condition precedent to fulfilment of his undertaking or the Petitioner’s right to reimbursement.

52.  Accordingly, I find against the Respondent on his contention on right to reimbursement and ‘double reimbursement’.       

Underlying purposes of payments made to be made known

53.  At paragraph 10 of the 2^nd Affirmation, the Respondent contended that the underlying purposes of many of the payments sought by the Petitioner to be reimbursed were not known to him.  He was therefore unable to ascertain whether those payments fell within the reimbursement item of ‘educational expenses’ under Recital D (i) of the Consent Order.

54.  I do not see such contention lead him anywhere to support his Variation Application.  He was referring to historic event which could, in my view, easily discerned by having a look at the contents of those documents which were issued by the University. The contents of which are clear.  There are dates and descriptions against each entry of charges such as Physics 2CL Laboratory Fee, Hsg Contract Charge – pay in full (at page 102 of the Hearing Bundle), Chemistry Lab Fee, Winter Qr 2012 Registration Fees (at page 104 of the Hearing Bundle) etc.  I noted, however, the Respondent was able to understand those entries of health insurance fees also recorded in the same billing statements which he contended as ‘double reimbursement’ but at the same time claiming that the underlying purposes of those other payments (all expressed in simple English) were not known to him.  

55.  I do not believe the Respondent that he did not know the underlying purposes of payments sought for reimbursement. 

Conclusion

56.  For the reasons aforesaid, I find against the Respondent in his Variation Application (as amended) on Recital D (i) and (iii) of the Consent Order.

57.  Now I will deal with his alternative variation application on Paragraph 4 of the Consent Order.

Alternative Variations

58.  The alternative variation application is a two-limb variation.

59.  The first limb refers to the situation where there is a separate reimbursement before the children completing tertiary education (bachelor degree) towards boarding, meal, excursion trips and other items which are  not directly related to education under Recital D (i) of the Consent Order, the rate of periodic maintenance payments should then be reduced accordingly to take such reimbursement into account.   The second limb refers to the time when the children reaches 18, the rate to be reduced to US$2,250 per child per month after the age of 18 until each child completes tertiary education (bachelor degree).

60.  The Respondent provided his reasons on the two alternative variations application at paragraphs 7 and 8 of his 2^nd Affirmation.

61.  The basis which I have found against the Respondent on his variation on Recital D (i) of the Consent Order is that those expenses sought to be reimbursed fall within ‘all tertiary educational expenses’ under Recital D (i).  Since the first limb would ‘survive’ only if there is a finding that the items which should be reimbursed are not directly related  to educational expenses, this follows that the first limb must fail.  The simple reason is that there is no finding that those expenses in issue are not directly related to educational expenses. 

62.  The second limb in essence is a reduction in money terms of the maintenance amount under the Consent Order.  As I have stated in paragraph 12 of this Judgment, there is no issue at any time as to the Respondent’s means and ability of meeting the agreed maintenance sum.  The Respondent is relying on the ground of ‘reasonableness’ as can be seen in paragraph 8 of his 2^nd Affirmation :-

“8. Further or alternatively, in the event that this Court refuses to

grant the first variation sought in the Application, I would

respectfully submit that the cost of maintenance when the child

is receiving tertiary education with full boarding arrangements is

substantially lower, since by then, housing expenses will be

reduced to nil and expenses for leisure activities will be much

reduced. Under such circumstances, it would be reasonable to

reduce the amount of the maintenance payment to half of the

original maintenance, i.e. to US$2,250 per month, which would

still be more than adequate to cover the cost of maintenance.

This is the basis of my application for the third amendment of

the Application.”

63.  In addition to the approach to be adopted summarised in the case of AEM v. VFM (which I recited at paragraph 16 of this Judgment), it has also been said in an earlier English case of Boylan v. Boylan [1988] 1 FLR 282 at 289D by Booth J :-

“…..in my judgment the court should not adopt an approach which

differs radically from the approach taken by the parties themselves in

assessing quantum of maintenance when the original consent order was

made.”

64.  Moreover, in the case of J v. C (Child : Financial Provision [1999] 1 FLR 152 at 160A by Hale J :-

“……the child is entitled to be brought up in circumstances which bear

some sort of relationship with the father’s current resources and the

father’s present standard of living.”

65.  The question posed by the second limb is simply that whether it is reasonable for a 50% reduction (i.e. from US$4,500 to US$2,250 per month) merely because the children are receiving tertiary education with full boarding arrangement provided ? 

66.  In my judgment, the answer is in the negative for the reasons below.

67.  As part of my finding, boarding arrangement falls within “all tertiary educational expenses” which the Respondent foresaw and undertook to be fully responsible.  The children would be attending tertiary education (bachelor degree) is at all times expected.  At the same time, the Respondent had agreed to US$4,500 per month per child until each of them individually attains 18 or completes tertiary education (bachelor degree) whichever is the later or further order (see Paragraph 4 of the Consent Order). 

68.  Applying the principle of ‘reasonableness’, which must be considered fairly, objectively and with all things being equal, I find it  unreasonable if the Respondent could now raise such a 50% downward variation which, as I see it, could have been canvassed at the time of the Consent Order but it had not.  In particular, the reason put forward now for such 50% downward variation was not something unforeseeable or unexpected by the Respondent when the Consent Order was granted.  Quite contrary, the children receiving tertiary education is something within full contemplation of the Respondent at all times.  The downward adjustment of 50% is also arbitrary and unreasonable.  

69.  Secondly, the conduct of the Respondent himself has not been reasonable.   Given the benefit of doubt as to whether those expenses at issue are part of the tertiary educational expenses has yet to be clarified and determined, the Respondent started with failing to comply with the terms of the Consent Order by not paying the annual periodical maintenance for the eldest child of US$54,000 annually due on 5^th January 2011 resulting in a Judgment Summons was issued against him on 12 January 2012.  As Mr. Pilbrow rightly pointed out in paragraph 4 (e) of his written note of submission dated 12 September 2012, the Variation Application was only taken out on 30^th April 2012 which was 1 year and 4 months since the due date for payment.  Due to the Variation Application, the Judgment Summons has then to be adjourned and yet to be heard.

70.  Moreover, I do not agree the costs of maintenance will be substantially lowered merely for the fact the children are having boarding arrangement.  First, the Petitioner would still have to maintain the accommodation for the children since they would be returning home on holidays.  The accommodation costs would not be necessarily lowered in a way that the Petitioner was expected and able to ‘rent out’ the children’s rooms whilst they were in school boarding.  The costs of food and personal items which are necessities would be more or less the same whether the child is living at home or at school boarding.  The price for a pack of sandwich bought at the University if compare with a ‘home-made’ one may be different.  But in real life, it is difficult if not impossible, to compare and count on food and necessities to every single dollar and dime when one comes to work out the amount of children’s maintenance.

71.  In my Judgment, there is no basis for the 2 limbs of the alternative variation.  Besides, I also find the 50% downward reduction in the second limb of the alternative variation differs radically from the approach which the parties had adopted in terms of periodic payments at the time of the Consent Order.  Applying the cases of AEM v. VFM and Boylan v. Boylan, I will dismiss the alternative variation.

Overall Result

72.  For all the reasons aforesaid, I find the Respondent’s Variation Application (as amended) (including the 2 limbs of the alternative variation) lack of merits and must be dismissed.  There are no exceptional circumstances which I can consider departing from the usual rule on costs.  I will accordingly order the Respondent to pay the costs of the Variation Application (as amended), including all costs reserved, to be taxed if not agreed.  Given the Respondent’s application is not a complicated one, I find it not a case fit for granting Certificate for Counsel.

73.  As to the Amendment Application, I have already decided at the hearing that there be no Order as to costs. 

Judgment Summons

74.  The Judgment Summons was adjourned pending determination of the Variation Application.  I now directed the Judgment Summons be tried on 31 January 2013 at 10:30 a.m. with one day reserved.

Order

75.  I will grant the Order as follows :-

(a) Respondent’s Summons for variation (as amended) dated 30 be dismissed;

(b) Petitioner’s Judgment Summons be fixed for hearing on 31   January 2013 at 10:30 a.m. with 1 day reserved; and

(c) The costs of the Respondent’s Summons for variation (as amended) dated 30 April 2012 be to the Petitioner, to be taxed if not agreed.

76.  The costs order nisi will become absolute unless any party applies to vary the same within 14 days.