WXJ v. YCK

FCMC 677/2018

[2020] HKFC 134

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 677 OF 2018

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BETWEEN

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J U D G M E N T

(Variation of maintenance pending suit/interim maintenance,

Directions and Setting aside/ Stay of execution)

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Introduction

1.  The Petitioner is the Wife (“W”) and the Respondent is the Husband (“H”).

2.  Parties married in January 2011 in Mainland China.  Both H and W are now at the age of 41.

3.  There is one child of the family, a girl who was born in 2014 and turning to the age of 6 in August this year.

4.  In January 2018, W petitioned for divorce relying upon the fact of “Unreasonable Behaviour”.  H filed the Acknowledgement of Service (Form 4) contesting the divorce followed by an Answer and Cross Petition on W’s “Unreasonable Behaviour”. This was done through his then lawyers Messrs. Wong & Co., Solicitors.

5.  On 9/4/2018, this Court granted an Order upon the consensus of the parties that H do pay to W maintenance pending suit at HK$6,000 a month and interim maintenance for the child of the family (“Child”) at HK$2,100 a month, both of which to commence on 15/4/2018 and thereafter on or before the 15^th day of each succeeding month (“9/4/2018 Order”).  In addition, H gave an undertaking that he would continue to pay the rental of a flat in Yuen Long (“Yuen Long flat”) where W and the Child resided at the time and the rental was HK$8,300 a month (“Undertaking”).

6.  On 15/6/2018, H filed a Notice to Act in Person.

7.  On 12/1/2019, W signed a tenancy agreement and rented a flat in Tuen Mun at the rental of HK$11,500 a month (“Tuen Mun flat”).

8.  On 23/1/2019, W was granted custody, care and control of the Child with reasonable access to H.

9.  On 9/8/2019, this Court granted an Order by consent for W to amend the particulars of unreasonable behaviour in her Petition upon H’s undertaking to file fresh Form 4 not to contest the divorce (as amended) and to withdraw his Answer and Cross Petition.  W’s proceedings then proceed along uncontested.

10.  On 3/10/2019, this Court granted an Order that there be interim variation of paragraph 3 of the 9/4/2018 Order to the extent that the maintenance pending suit payable to W on 15/9/2019 and 15/10/2019 (that is, for the months of September and October) be varied downwards to HK$2,900 a month.

11.  Decree Nisi was granted on 23/6/2020.

The Applications

12.  There are 3 Summonses before the Court taken out by the parties :-

(a) W’s Summons dated 20/2/2019 (“Summons 1”);

(b) W’s Summons dated 18/4/2019 (“Summons 2”);

(c) H’s Summons dated 22/5/2019 (“Summons 3”).

13.  In Summons 1, W sought an upward variation of the amount of maintenance pending suit for herself to HK$10,750 a month and interim maintenance for the Child to HK$ 8,250 a month.  The respective affirmations are :-

- W’s affirmation in support (W’s 8^th Aff”);

- H’s affirmation in opposition (H’s 5^th Aff”); and

- W’s affirmation in reply (W’s 9^th Aff”).

14.  In Summons 2, W sought a declaration that the Undertaking given by H under the 9/4/2018 Order as to payment of the rental for the flat in Yuen Long to mean W’s residence at the same rate of HK$8,300 a month.  There is also a claim against H for the sum of HK$24,900 (subject to Director of Legal Aid’s First Charge), being as to 3 months’ arrears of rental payment for February, March and April 2019.  The respective affirmations are :-

- W’s affirmation in support (“W’s 10^th Aff”);

- H’s affirmation in opposition (“H’s 7^th Aff”); and

- W’s affirmation in reply (“W’s 12^th Aff”).

15.  In Summons 3, H sought to set aside (i) his Undertaking provided to Court and to W, (ii) paragraph 3 of the 9/4/2018 Order as to payment of monthly rental of the Yuen Long flat at HK$8,300 a month and (iii) the maintenance pending suit to W at HK$6,000 a month.  H also asked for stay of execution of the 9/4/2018 Order as to W’s maintenance pending suit until determination of Summons 3.  The respective affirmations are :-

- H’s affirmation in support (H’s 6^th Aff”);

- W’s affirmation in opposition (W’s 11^th Aff”); and

- H’s affirmation in reply (“H’s 8^th Aff”).

The Issues

16.  Given consideration to the parties’ applications, the issues within the 3 Summonses which this Court need to resolve are as follows :-

(a) Whether H’s Undertaking under the 9/4/2018 Order to pay rental of the Yuen Long flat was restrictive in its terms as to locality of the flat and/or amount of the rent ?

(b) Whether there are any material change of circumstances both in W’s and H’s case for their respective applications, namely, increase of maintenance pending suit and interim maintenance sought by W; and H’s application for the discharge of Undertaking and setting aside the maintenance pending suit for W under the 9/4/2018 Order ?

(c) Whether there are any grounds or factors to support a stay of execution of the 9/4/2018 Order.

The statutory provisions and legal principles

17.  The jurisdiction of the Court in applications for variation of maintenance order is under section 11 of the 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) This section applies to the following orders, that is to say –

(a) any order under section 3;

(b) any order made by virtue of section 4(1)(a) or (b) or 4(2)(b);

(c) any order made by virtue of section 5(2)(a) or (b) or 5(4);

(d) any order made by virtue of section 6(1)(b), (c), (d) or € on or after granting a decree of judicial separation;

(da) any order made by virtue of section 6A; and

(e) any order made by virtue of section 8(5), 8(6)(a), (b), (d) or (e) or 8(7)(b).

………

(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……..”

18.  The approach of the Court has been summarised in the leading case of AEM v. VFM (Variation of Maintenance)[1]:

“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”.

19.  In considering whether there is a material change of circumstances, the court may look at the case de novo.  In other words, the court is not fettered by the existence of a previous order. Thus, the court may look at the overall situation afresh and make an order based on the parties’ existing financial circumstances and needs.  The court has a broad discretion in applications relating to variation.[2] In so doing, the court should also bear in mind that an application to vary the terms of a settlement embodied in a consent order are not to be lightly entertained unless the party seeking to disturb the same can show good and substantial cause.[3]  In the case of L v. C[4] where Stock JA said :

“The courts must be astute in this field to guard against the manipulative litigant who seeks to undo an agreement…… and to bear in mind the factors, quite clear now as a result of developed authority, which might go to vitiate such agreement……”

20.  In the case of HCTT v. TYYC[5], Mr. Justice Lam (as he then was) agreed with the judgment of Hon Tang VP (as he then was) in the case, citing L v. C and said :

“43. I hasten to add that the courts in the family jurisdiction must be equally astute to guard against unmeritorious applications for variation by litigants who have second thoughts about settlements they have knowingly reached on their own volition.

…………

45. Further, in many instances, one or both parties are acting in person. Lack of legal representation should not be regarded as a vitiating factor in an ordinary sense.

46. Therefore it would go against the modern ethos of family dispute management if the court were to entertain lightly an application to vary the terms of a settlement embodied in a consent order.

47. I think the following approach suggested by Stock JA at para 42 of L v. C [2007] 3HKLRD 819 at p.841, with slight modifications, can equally serve as a good guidance for deciding whether an application for variation of periodical payments in a consent order should be entertained,

“an agreement [on periodical payments] is ‘presumptively [not to be varied without material change of circumstances]’, the burden being on the party seeking to achieve a different [terms] to show good and substantial cause why the compact should not be respected, and ….. the scope for so doing is one directed at an injustice in the circumstances in which the agreement came to be concluded or in clear injustice occasioned to one of the parties by reason of event unforeseen at the time of the agreement were the agreement to be enforced to its letter."

21.  H’s lawyer Mr. Wong cited a number of cases of which I will only refer to those which are of relevance and importance.

Discussion and Analysis

Issue (a)

22.  H’s case is that the Undertaking given was restricted to paying the rent of the Yuen Long flat which at the time was HK$8,300 a month.  Reason being that the terms of the Undertaking specifically referred to the address of the Yuen Long flat and also the amount of the rental at that time.   

23.  W in her 8^th Affirmation sets out the reasons for moving out the Yuen Long flat and renting the Tuen Mun flat at the higher rent of HK$11,500 a month.  Actually, the Yuen Long flat was rented by H around November 2017 when the parties separated.  At that time, the Child was attending K1 nursery in a kindergarten in Yuen Long. Starting from September 2018, the Child attended her K2 in another kindergarten in Tuen Mun.  The travelling time from the Yuen Long flat to the Tuen Mun kindergarten was around 20 minutes by public transport.  The change of flat was to minimise such travelling time because it took only 3 minutes to walk from the newly rented  Tuen Mun flat to the Child’s kindergarten for her K2.[6]

24.  Apart from disputing W’s reasons for the moving of flats, H in his 5^th Affirmation contended that he was only first notified by W’s lawyers on the so-called “intended” moving out from the Yuen Long flat in a letter dated 11/1/2019.  As a matter of fact, W signed the tenancy agreement for the Tuen Mun flat the following day, that is, on 12/1/2019.[7]  It was not a case of “intended” to move but rather decided (emphasis added) to move.  Moreover, H contended that there are other options in Tuen Mun area where the monthly rental ranged from HK$9,000 to HK$10,000.  It was unreasonable for W to rent at the higher rate of HK$11,500 a month, without his knowledge and consent, and then shifted the responsibility for the increased rental payment upon him.[8]

25.  W’s Summons 2 was issued on 18/4/2019 which was after H filed his 5^th Affirmation in opposition to Summons 1 on 28/3/2019.  W in her 8^th Affirmation in support of her Summons 1 said the main reason for the need to increase the maintenance pending suit was because of the increase in rental payment.  Thus, by issuing Summons 2 to seek the Court’s interpretation of H’s Undertaking of the payment of HK$8,300 under the 9/4/2018 Order to mean paying for W’s residence in the sum of HK$8,300 a month, W was compromising her position for the increase of maintenance pending suit under her Summons 1.

26.  The Undertaking was provided by H, with the benefit of legal advice and represented by Counsel Miss Moy, at the first hearing of the 1^st Appointment. According to the records of hearing, the hearing on that day started from 9:58 a.m. and then stood down for parties to negotiate.  It ended at 3:23 p.m. after lunch.  The Undertaking was then provided along with those other terms under the 9/4/2018 Order upon the consensus of the parties.

27.  Mr. Lee for W, who attended the hearing on 9/4/2018 and took part in the process of negotiation, submitted that the address of the Yuen Long flat appeared in the 9/4/2018 Order was purely for the sake of convenience and clarity.  It was not intended by the parties to restrict paying rent only for the Yuen Long flat and at HK$8,300 a month.  Mr. Wong for H, apparently not attended the negotiation as there was a change of lawyers, was in no position to say what was actually said or intended in the process of negotiation.  Mr. Wong only tried his best to persuade this Court to take the plain and clear words of the Order as they stand as to what it means.

28.  In my decision, I accept Mr. Lee’s submission.  If one looks at the 9/4/2018 Order as a whole, the Undertaking preceded the other provisions for maintenance pending suit to W and interim maintenance for the Child.  It is clear that the Undertaking catered for accommodation needs only.  It

took almost a day for the parties to come to that consensus through legal representatives on both sides.  On 9/4/2018, there was ample time for H’s legal team, say for instance, to simply include the word “only” either preceding or following the address of the Yuen Long flat so as to restrict or qualify the ambit of the Undertaking, had that been the parties’ intention as to accommodation needs.  As a matter of fact, I noticed the printed draft used by the parties on that day was prepared by H’s lawyers upon which there were amendments in manuscripts.  Thus, H’s lawyers would have 2 chances to restrict or qualify his client’s Undertaking by simply putting in the word, “only” either on the printed draft prepared before the hearing or in manuscript added during the hearing.  However, neither of these had happened.  The stated amount of rental of HK$8,300, in my decision, could not assist H’s case that it restricted only to the Yuen Long flat which was rented at HK$8,300 a month at the time.  That said, the stated amount of HK$8,300 was, and more probable than not, only setting a limit for accommodation costs for W and the Child.

29.  With my decision on Issue (a), it substantially solved Summons 2 taken out by W for the declaration save and except the other claim therein for 3 months’ arrears of the rental payment totalling HK$24,900 (HK$8,300 x 3).  For such claim, it must fail since it is a matter of enforcement rather than reliefs prayed for in a Summons.

30.  Following my decision on Issue (a), Summons 2 would become academic and have to be dismissed in its entirety, let alone the question of costs.

Issue (b)

31.  W’s Summons for maintenance pending suit and interim maintenance was filed on 9/4/2018.  There was no MPS budget set out in W’s 4^th Affirmation in support of the application.  The only MPS budget before this Court was contained in paragraphs 14 to 17 of W’s 8^th Affirmation[9] which was filed for supporting the upward adjustment of the agreed amount.  The General Expenses added up to HK$16,500; Personal Expenses added up to HK$4,000 and Child’s Expenses added up to HK$2,500.

32.  Going through the individual items under W’s MPS budget and assessing them on a “broad brush” basis, given my decision as to the rental payment under Issue (a) above, the MPS budget would be revised as follows :-

“General Expenses

Item		Amount claimed by W		Amount assessed by Court
Rent	HK$	11,500	HK$	8,300
Utilities (electricity, gas, rates, telephone & water)	HK$	600	HK$	600
Food	HK$	4,000	HK$	2,000
Household expenses	HK$	400	HK$	300
Total :	HK$	16,500	HK$	11,200

Personal Expenses

Item		Amount claimed by W		Amount assessed by Court
Meals out of home	HK$	2,000	HK$	1,800
Transport	HK$	200	HK$	200
Clothing/ Shoes	HK$	500	HK$	200
Personal grooming (including haircut and cosmetics)	HK$	300	HK$	200
Entertainment/ presents	HK$	400	HK$	200
Holiday	HK$	500	HK$	200
Medical/ Dental	HK$	100	HK$	100
Total :	HK$	4,000	HK$	2,900

Child’s Expenses

Item		Amount claimed by W		Amount assessed by Court
School books and stationery	HK$	200	HK$	200
Medical/ Dental	HK$	200	HK$	200
Extra-Curricular Activities	HK$	300	HK$	300
Entertainment/ presents	HK$	500	HK$	300
Holidays	HK$	500	HK$	300
Clothing/ Shoes	HK$	200	HK$	200
Lunches and pocket money	HK$	400	HK$	100
Uniform	HK$	100	HK$	100
Transport	HK$	100	HK$	100
Total :	HK$	2,500	HK$	1,800

33.  By an equal split of the assessed amount of General Expenses between W and the Child, the amount required for W would thus become HK$8,500 (that is HK$11,200 x ½ + HK$2,900) a month; the amount required for the Child would become HK$7,400 (that is HK$11,200 x ½ + HK$1,800) a month.

34.  Hence, both the amount assessed for W’s maintenance pending suit at HK$8,500 and the Child’s interim maintenance at HK$7,400 fall below the amount claimed by W in Summons 1.

35.  Now I will deal with H’s ability to pay the amount assessed by this Court to see whether there are grounds for H to set aside the Undertaking and the maintenance pending suit for W.

36.  The 9/4/2018 was a consent order.  It is trite that the party seeking variation of a consent order must prove that there was substantial and material change of circumstances since the order was granted which could not be reasonably foreseeable and had rendered the consent order no longer practicable or possible for compliance. 

37.  According to H’s Form E dated 3/4/2018, he was a Director with his father’s logistic company earning a salary of HK$28,700 plus double pay of HK$2,400 thus making a monthly income of HK$31,100.  This was the time just before the 9/4/2018 Order was granted with consensus of the parties.

38.  Besides, H was holding 25% shareholding in his father’s logistic company and also 25% shareholding in another related transportation company.  Further, he was the sole owner holding 100% shares of a company by the name Sxxx Vxxx (Hong Kong) Limited[10]. On 21/5/2018, H transferred his 25% shareholding in the transportation company to his father[11]. H was also one of the directors of The Hong Kong Cxxx Txxx Oxxx Association Limited[12].

39.  H’s case was that due to W’s unfounded allegation against his parents for physical abusing the Child and against his younger brother for sexually abusing the Child, his relationship with his family deteriorated drastically.  He was asked by his family to leave the family business.  In December 2018, he then moved out from his family and started to live with his girlfriend in Hunghom area.  He had to pay HK$5,000 a month to his girlfriend as contribution towards costs of living.  The property in Hunghom belonged to his girlfriend.

40.  Moreover, at that time his girlfriend was pregnant and going to give birth in September 2019.  He foresaw his monthly expenses would increase.   Following his resignation from the family business in March 2019, he obtained a licence in estate agency and started employment with Centaline Estate Agency Limited on 10/4/2019.  The basic salary was only HK$5,500 a month with a minimum wages of HK$8,775 plus commission[13].

41.  H’s sets out his monthly expenses as follows :-

Item		Amount
Payment to girlfriend as contribution of living expenses	HK$	5,000
Meals out of home	HK$	1,050
Clothing and shoes	HK$	600
Insurance premium	HK$	1,876
Interim maintenance to daughter	HK$	2,100
Personal loan instalment	HK$	8,786
Maintenance pending suit and Yuen Long rental	HK$	14,300
Telephone	HK$	200
Total :	HK$	33,912

42.  Despite the fact that there was a record of transfer of 5,000 shares from H to his father in the transportation company on 21/5/2018[14], I am not convinced that such record of transfer of shares could support H’s case that his relationship with his family had broken down to the extent that he had to leave his family business.  There was no direct evidence, such as affirmation, from either H’s father or younger brother to support H’s case.  H also failed to convince this Court of any urgent need to switch his work to one with a substantially reduced income, let alone the nature of the work was completely different from his work in the family business.  Even though W’s allegation had damaged H’s relationship with his family (of which this Court made no such finding), I fail to see how H’s immediate departures from the family business would improve the situation.

43.  Besides, from an objective point of view, the sudden change of employment from a company director with fixed income to a salesperson in the field of estate agency with fluctuating income is dubious, if not self-serving.  In particular, it seems odd and illogical for H, well knowing that he had to pay contribution of HK$5,000 to his girlfriend starting from December 2018 and also his obligation to pay under Undertaking and the terms of the 19/4/2018 Order, to accept employment in March 2019 offering him only HK$5,500 a month basic salary, even though with a minimum guaranteed income of HK$8,775 a month plus commission, just barely enough even to cover his payment of HK$5,000 to his girlfriend. 

44.  In my decision, it is more likely than not, that H’s sudden change of employment to a completely different industry allegedly due to the breakdown of relationship with his family, was a scheme set up for posing a material change of circumstances to ground his application to set aside the Undertaking and the maintenance pending suit for W under the 9/4/2018 Order.

45.  I decided that H’s application under Summons 3 must fail.

Issue (c)

46.  For H’s other part of the application under Summons 3 for stay of execution of the 9/4/2019 Order, I find that there are no grounds for granting such a stay given the fact that H failed completely in his setting aside application.

Conclusion

47.  For all the above reasons, I decided W’s Summons 1 partially successful.  W failed in her Summons 2.  H failed in his Summons 3.

Costs

48.  Although W had been partially successful in her Summons 1 for an upward variation, I decided that she should not be entitled to the costs of the application for the following reasons.

49.  First, the adjusted amount was because of the passage of time rather than upon proof of any unforeseeable material and substantial change of circumstances.  Secondly, the respective amounts assessed after this trial was lower than the amounts claimed by W in her Summons.  Thirdly, the change from the Yuen Long flat to the Tuen Mun flat, which was the major cause for the application for increase, does not fall within the criteria of substantial and material change of circumstances which were unforeseeable but rather it was the personal choice of W for saving travelling time.

50.  I decided that it is fair and reasonable not to make any order as to costs of Summons 1, including all costs reserved.

51.  For Summonses 2 and 3, I decided that there be no Order as to costs.

52.  I also decided that both parties’ own costs for the 3 Summonses be taxed in accordance with Legal Aid Regulations.

Orders

53.  I now grant the following Orders :-

(1) Paragraph 3 of the 9/4/2018 Order be varied in that the amount of maintenance pending suit for W to become HK$8,500 a month for W (Petitioner) (subject to Director of Legal Aid’s First Charge) and interim maintenance for the Child to become HK$7,400 a month; both to commence on 15/7/2020 and thereafter on or before the 15^th day of each succeeding month until further Order;

(2) W’s Summons dated 18/4/2019 (“Summons 2”) be dismissed;

(3) H’s Summons dated 22/5/2019 (“Summons 3”) be dismissed;

(4) There be no Order as to costs of all the 3 Summonses;

(5) Both parties’ own costs for all the 3 Summonses be taxed in accordance with Legal Aid Regulations.

54.  This is a costs order nisi which will become absolute if no application to vary the same is made within 14 days from the date of this Judgment.

55.  Last but not least, I wish to thank both parties’ legal representatives for their valuable assistance to this Court.