SG v. GDV

FCMC 10217/2020

[2025] HKFC 136

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 10217 OF 2020

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J U D G M E N T

( Variation of Maintenance )

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The Application

1.  This is the 1^st Respondent husband’s (“H”) third application for varying down of maintenance dated 28 February 2023 to an Order previously made by HHJ Melloy in August 2021.

2.  Petitioner wife (“W”) opposes his application.

3.  W is represented by counsel and H acts in person.

Brief background

4.  F is a US national and a businessman whose company operates a real estate platform on the internet (“AIS”). W comes from Kyrgyzstan and has been a housewife most of her married life, and has also helped H in his company. It is not disputed that H is the sole breadwinner for the family.

5.  Reference can be made to previous decisions from HHJ Melloy in August 2021 on MPS, and my decision on relocation in January 2023, which provide background on the parties; and I shall only focus on what is relevant to this decision.

6.  Parties married in the US in May 2004 and came to Hong Kong in around 2006. The children are respectively L, born on XX August 2010 and P born on XX October 2012 (together the “Children”).

7.  When the marriage broke down, W petitioned for divorce on 5 November 2020. This is a long marriage of more than 16 years.

8.  It is also apt to cite here where the children were respectively studying during the relevant time of this application.

  For L

  2021 - 2022  ICA

  2022 - 2023  Pearson Online learning

  2023 - 2024  A International School

  For P

  2021 - 2022  ICA

  2022 – 2023  YCA (formerly known as ICA)

  2023 – 2024  CMS (a local school)  

Procedural history

9.  Despite the fact that the divorce proceedings commenced only from November 2020, there has been no less than 40 substantive applications made by H over the last 4 ½ years.

10.  In the backdrop, H is facing litigation in the High Court from AIS’s co-shareholders which details I will not delve into here; suffice to say that there is overlap with the subject matter of W’s S.17 Summons dated 29 August 2022 over shares in AIS, which is the major piece of matrimonial property.

11.  In terms of care arrangement, when the parties were still living under the same roof, HHJ Melloy made an Order on 23 February 2021 for the parties to spend time with the Children separately. It became clear by August 2021 that it was not working out and parties must separate. W took out a Summons under the Domestic Violence Ordinance against H with regard to P on 13 August 2021, and she moved out of the former matrimonial home on MacDonnell Road (the “McDonnell residence”) in the same month. The care arrangement made by HHJ Melloy dated 16 August 2021 was:

a.  H to have interim care and control of L

b.  W to have interim care and control of P

c.  W shall have interim access to L together with P after school every Monday and Tuesday until 5pm

d.  H shall have interim access to P together with L after school every Wednesday and Thursday.

12.  Despite this arrangement, I understand that the parties have remained somewhat flexible in terms of where the Children spent time with which parent and for how long, at times dictated by how the respective child feels at the relevant time. The Children have been in split custody with the respective parent since then.

13.  W puts in her application for MPS as early as January 2021, whereupon HHJ Melloy gave directions in March 2021 that it would be dealt with by paper disposal, the decision arising therefrom is the Order against which H is now seeking variation.

14.  For W’s MPS application, both parties were represented by counsels, who made written submission to the Judge. HHJ Melloy’s MPS decision on 13 August 2021 provides for, inter alia the following:

a.  H to pay spousal maintenance of $8,000.

b.  H to pay children maintenance of $18,000 each.

c.  The total amount of $44,000 to include a rental provision of $28,000.

d.  H is directed to pay for the rental deposit of $56,000 and continue to pay school fees for the Children.

e.  Maintenance payments should commence from 1^st of August 2021 and thereafter on the 1^st of each the month.

(“August 2021 Order”)

15.  For completeness and to put on record here, H has made two prior variation of maintenance applications. The first one was 11 days after HHJ Melloy handed down the abovementioned decision in August 2021. On 21 September 2021, the Judge directed that this application be dealt with by paper disposal but this was not proceeded with. H’s second variation application was made on 11 July 2022, however at a hearing on 2 August 2022, this application was adjourned sine die, as the relocation trial was then upcoming in the following month, and which decision would affect the MPS amount.

16.  At a hearing on 21 April 2023, I made an Order that the first and second variation application be dismissed as they have been superseded by this current application before me.

17.  H applied for permanent relocation for his Children in 20 September 2021, this application was heard by me in September 2022, and I refused leave in my decision on 9 January 2023. Since then, H has made countless ongoing claims of debt spiral, economic duress and dire financial difficulties; and a few further attempts at holiday removals, temporary removals for education and a second relocation application.

18.  The second relocation application was heard at a 7-day trial in May 2025 with judgment now pending. During the trial, parties agreed for L to be permanently removed to the US. The decision will therefore be focused on P.

19.  As for progress on the ancillary relief application. Due to the parallel proceedings in the High Court over the shares in AIS, the ancillary relief proceedings were adjourned by my Order dated 9 October 2024.

20.  Admittedly, this decision on H’s variation has taken a long time. With the original deadline in September 2024, this was put on pause when the parties indicated back in around the summer of 2024 that they were trying to reach global settlement; it was not until January 2025 that it became clear that the settlement attempts had failed, and the clock on this decision restarted.

The Evidence

21.  The agreed trial bundles contain two Affirmations by W dated 26 August 2022 and 19 May 2023, and two Affirmations by H dated 28 February 2023 and 29 May 2023.

22.  Financial disclosures include the following: W’s Form E dated 4 January 2021; H’s two Form Es dated 16 March 2021 and 28 February 2023. There were also H’s two answers to questionnaires dated 26 August 2021 and 29 September 2021 respectively. Some other financial information from H has come in via correspondences.  

23.  H has also submitted a disputed trial bundle which contains:

a.  CEO Compensation 2021 – October 2023

b.  Company bank balance 2021 – October 2023

c.  Family loans children 2021 – October 2023

d.  Company bank statements 2021 – October 2023

24.  The variation hearing was heard on two mornings, on 21 and 29 November 2023 respectively. W continues to be assisted by counsel and H acts in person, both parties were cross-examined by the other.

25.  I will also add here that H has tried to introduce further evidence post-trial to support his variation application, this application was made in February 2024 and was dismissed in March 2024.

H’s case

26.  H has repeatedly made a lot of complaints about W and her legal representation in how they have misled the court at the previous maintenance application, and he calls the August 2021 Order: the “unaffordable” “blind” interim maintenance order. In particular, he says that the Court made its decision based on its belief that he makes $300,000 per month. He says he does not have the means to pay the maintenance amount under the August 2021 Order even “from Day 1”.

27.  H argues that he is not receiving income from his company, that he can no longer withdraw money from the company as he used to, and that the company is losing money.

28.  H has also focused a substantive part of his argument on the sale by W of her diamond wedding ring. He says that the ring is an illegal sale and sold undervalue.

29.  H has said that the August 2021 decision was based on the Children living with W, which in reality is not the case.  The decision says that each child is allocated $18,000, but as L does not reside with the W, H says that there has been overpayment on his part; yet in his opening and closing submissions he says that he is not claiming this nor seeking “financial restitution for past overpayments”.

30.  H lists out a number of voluntary payments he says he made which is beyond the August 2021 Order, this includes H buying groceries to give to W, W and P’s phone bills and some activities for P, these he calls “Good Faith Payment” in the sum of approximately $131,500.

31.  In this third variation application, he asks for the maintenance to be paid to W to be reduced to $14,000 to $16,000 from February 2023. Then despite his knowledge that the previous two applications had been dismissed, he referenced his two applications and says that the payment prior to February 2023 should be:

a.  From August 2021 to May 2022: Reduction to $34,000

b.  From July 2022 to January 2023: Reduction to $28,000

It is not clear what he proposes for June 2022.

32.  H also proposes to deduct the proceeds of W’s diamond ring to be set off on the amount outstanding to W; and says that for all the “Good Faith payments” (of $131,500) to W, he is to be relieved of all the outstanding payments due to her.

W’s case

33.  W seeks to dismiss H’s application. She says there has not been any material change of circumstances.

34.  W says that H is able to pay the original amount ordered. H’s declared income in his updated Form E as $54,428 per month, his rental of $56,500 is paid by the company, and he has income from a property in the US (“S Property”).

35.  She also contends that H’s mother has been providing loans to F, loans that have not been repaid for a lengthy period of time. On this particular point, she reminds the Court that during the relocation hearing, H’s mother has offered to pay for the Children if they move to the US, but not if they stayed in HK. I commented on this in §§73-4 of my Relocation Judgment.

36.  She says H has never paid the amount that the Court ordered except for a few months in 2021. The following is H’s pattern of payment, against the $44,000 monthly maintenance order, H is still short of $365,000 as of May 2023.

Month	Amount Paid ($)	Amount still owed ($)
Aug 2021	14,000	30,000
Sept 2021	44,000	-
Oct 2021	44,000	-
Nov 2021	44,000	-
Dec 2021	44,000	-
Jan 2022	30,000	14,000
Feb 2022	19,500	24,500
Mar 2022	39,000	5,000
April 2022	30,000	14,000
May 2022	31,000	13,000
Jun 2022	29,000	15,000
Jul 2022	27,000	17,000
Aug 2022	33,000	11,000
Sep 2022	26,500	17,500
Oct 2022	26,500	17,500
Nov 2022	27,500	16,500
Dec 2022	19,500	24,500
Jan 2023	24,000	20,000
Feb 2023	16,500	27,500
March 2023	15,000	29,000
Apr 2023	14,000	30,000
May 2023	5,000	39,000
Total (up to date of W’s Affirmation)	603,000	365,000

37.  W says the payments have been haphazard, and hence she is always uncertain as to how much will be paid when. She was paying rent of $25,000 so it can seen for a number of months over the period, H’s payments were not even enough to pay for her rent.

38.  H has also failed to pay school fees.

a.  For the year 2021 to 2022, children were in ICA and F says schools fees had been paid.

b.  Then for 2022 to 2023, H claims he has no money to pay for L’s school fees and arrange for him to attend home schooling via internet classes. W sold her wedding ring so that P can continue to attend school at YCA (formerly known as ICA).

39.  W says H has failed in his duty of full and frank disclosure.

40.  W also says H never changed his standard of living, choosing to live at the McDonnell residence paid by his company and never attempted to find alternate jobs despite his Yale qualifications and that the company was allegedly going down.

Issues

41.  The issues before me are therefore:

A.  Have there been material change of circumstances that justify a variation of the maintenance

B.  H’s ability to pay

C.  W employment status, earning capacity and financial status

D.  Wife and Children’s needs

E.  Will there be any backdating of the maintenance payments

Applicable law

42.  The empowering legislation for variation of maintenance is in Section 11(1) and (7) of the Matrimonial Proceedings and Property Ordinance (Cap 192):

(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.

….

(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 and, where the party against whom that order was made has died, the changed circumstances resulting from his or her death.” (emphasis added)

43.  In the case of AEM v VFM [2008] 3 HKLRD 36, Cheung JA explained the modern approach in dealing with an application for variation of maintenance at §14 of the judgment, in particularly the following sub-paragraphs:

“3. The traditional approach to variation was not to re-fix afresh the amount of maintenance but to consider the amount of change in the actual means of the parties so that the new order should merely be increased or decreased roughly in proportion to the change in the means: Foster v. Foster [1964] 3 All ER 541, Jackson’s Matrimonial Finance and Taxation 7^th Ed. Ch. 3. 131.

4. The modern approach, as required by section 11(7), is for the Court to consider all the circumstances of the cases. The Court is not required to proceed from the starting point of the original order but look at the matter afresh: Flavell v. Flavell [1997] 1 FLR 353 at 357B following Lewis v. Lewis [1977] 1 WLR 409 and Garner v. Garner [1992] 1 FLR 573.

5. Any change in any of the matters to which the Court was required to consider when making the original order was one of the circumstances to be considered.

…

8. At the same time the basis and intended effect of the original order are 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: Boylan v. Boylan [1988] FLR 282.” (emphasis added)

44.  This theme was reiterated in a later Court of Appeal decision on variation, WNWG v PBF [2012] HKCU 675, where the Hon Lam J quoting in part from another important judgment on this issue, HCTT v TYYC [2008] 5 HKC 86, added that:

[12] As regards the approach that the court should adopt in considering an application for variation and the weight to be attached to the original order, Tang V-P said in HCTT v TYYC [2008] 5 HKC 86 at paras 15 to 16,

“15. But as Garner v Garner [1992] 1 FLR 573 shows that does not mean that the earlier order, whether made by consent or not, carries no weight. How much weight should be given to the earlier order must depend on the circumstances. Cazalet J said in the English Court of Appeal:

Almost invariably, an application to vary an earlier periodical payments order will be brought on the basis that there has been some change in the circumstances since the original order was made, otherwise, except in exceptional circumstances, the application will, in effect, be an appeal. If it was correct when made, then there will usually be no justification for varying it unless there has been a material change in the circumstances. However, because of the impact of continuing inflation, because children grow older and cost more to support and because, for example, the cost of living in its increase may hit one party harder than another, it will usually follow that, if time has passed, there will inevitably have been some changes in the circumstances, and in particular in the financial circumstances, of the parties concerned.

Following Lewis v Lewis, by which decision this court is bound, a court on the hearing of an application to vary is fully entitled to look at all the relevant matters set out in s. 25 of the Matrimonial Causes Act 1973. On occasions, the court may be slow to accede to an application to vary a consent order, not least because the parties’ solicitors might otherwise be deterred from either seeking to negotiate such a provision or to achieve finality. Another factor which may influence a court will be the time that has passed since the original order was made. If an application consequent on an order is brought very soon after that order has been made, the court, in normal circumstances, is likely to attach more weight to the earlier order than if it had been made some years previously. Likewise, the court would expect to pay full regard to any special terms agreed between the parties at the time the original order was made – as, for example, when endorsements on briefs or contemporaneous correspondence show that an agreed order has, for some particular reason, been set at an artificially low figure. Shortly stated, the court must decide what weight it should attach to the original order and all the surrounding circumstances. However, once an application to vary is before it, the court is fully entitled to make an order considering all the circumstances afresh, paying such regard to the old order as may be thought appropriate.”

16. Thus although the jurisdiction to vary is untrammelled, normally the earlier order would not be varied unless there has been a material change in circumstances. (emphasis added)      

45.  It is also well established that under general principles, both parties have the positive duty to make ongoing full and frank disclosure.

Discussion

A.  Have there been material change of circumstances to justify a variation of the maintenance

46.  It is of note that, in part, H’s case is not about a change of circumstances, as he says that HHJ Melloy made an Order based on misleading information (yet he never appealed but chose to take out his first variation application 11 days after the Judgment); so his argument that he was never able to pay the amount in the August 2021 Order exists from day one, and was therefore not a material change of circumstances.

47.  He repeatedly says he is in a debt spiral, and deteriorating financial situation. 

48.  W argues in her opening submission that there has been no material change of circumstances, including:

a.  There has been no change in his income;

b.  His employment remains the same, H has been saying that AIS may become insolvent since his first Form E, and despite that, he remains in the company, and makes no effort in looking for other gainful employment, despite being questioned on his intransigence;

c.  H continues to enjoy loans from his family members;

d.  There has not been much difference in his expenses and lifestyle. In the school year 2023-2024, he chose to spend money on L’s international school, and for expensive medical insurance at $85,379. His March 2021 Form E shows his monthly expenses were $132,156 (including maintenance of $14,000), and his February 2023 expenses were at $109,909, this latter number does not include the rental and school fees that the former did.

e.  H’s alleged bankruptcy proceedings from non-payment of legal bill to HI law firm was in existence from his March 2021 Form E, and he had done nothing to pay for it at the time of this variation application, so the statutory demand he raised in his May 2023 affirmation does not constitute a change of circumstances.

49.  As it is incumbent on me to look at the matter de novo in an application of this nature, these arguments will be further analysed below.

B.  F’s ability to pay

50.  Regarding H’s allegation that the August 2021 Order relied on H receiving $300,000 month, I accept the submission made by W’s counsel in this regard:

“In fact, the MPS Judgment merely states that as W’s case, and also records that H’s own case that he draws only $87,800 (MPS Judgment §5). It concludes that H’s financial situation is not clear (MPS Judgment §18).”

Therefore, H’s repeated complaint on this point is misconceived.  HHJ Melloy’s Order was not made on that assumption.

H’s Various Income / financial resources

51.  H declared an income of $87,800 in his March 2021 Form E “inclusive of rental” of $45,200, this income was noted in the August 2021 Judgment.; his net income should therefore be $42,600. Then in his February 2023 Form E, he declares his income as $54,428, this excludes rental as he says that he “lives in the Office” and the lease is in AIS’s name. The amount of the lease for the McDonnell residence then was $56,500, so this should tally $110,928 in order to compare like for like.  On these numbers alone, his net income is more in February 2023 than in March 2021.

52.  There has been a fair amount of exchange regarding the nature of the McDonnell residence, as H claims that it is the “office premises”, and that he is now living in his office/home since AIS closed its previous business address at Lyndhurst Terrace and the business was moved to the McDonnell residence in July 2021. H says that around 1/3 of the 1500 sq foot apartment has been used for installing AIS’s servers, printers and other company materials. W’s counsel argues that the value of the rental is H’s income, and H strenuously argues that the McDonnell residence is not his income.

53.  As far back as the evidence reveals, H has always had his rental paid for him by AIS, the fact that the office “moved” into the McDonnell residence is not a change of circumstances relevant to these proceedings (nor is this H’s case) as AIS continues to pay for this expense. Evidently, the provision of rented premises for him as managing director is part of his compensation package. H also argues that his housing should be excluded as “Office rental” but this is also incorrect. The “Office rental” appearing in the Company Cash Statements (provided by H) after August 2021 record ongoing payment of $8,333 for 12 months, and no more office rental payment after September 2022. H explains this amount in his May 2023 Affirmation to say that the $8,333 was a payment to the prior landlord for 12 months to pay the outstanding rental they owed on Lyndhurst Terrace. So from the Company’s point of view, it is not paying “Office rental” for McDonnell residence, it continues to pay the amount as H’s accommodation until he moved out; and it remains part of his compensation from AIS, though not in cash form. It is misleading on his part to say that his residence has become the office for which rental payment is made by the AIS as such.

54.  It is also of note here that H has continuously and repeatedly says that it is “impossible” to move the office equipment, or for that matter, himself. This is not an accepted argument. As at date of this Judgement, he has moved out of McDonnell residence, and the company IT system must have yet again been moved somewhere. I accept W’s argument that H has refused to downsize to save costs, his argument that it is “impossible” to move is again misleading, as he did move in July/August 2021. H only cites how much it costs to move the system; I find that this is more a case of unwillingness than impossibility on his part.

55.  When asked in W’s Questionnaire what is the “Office Network Hosting Fee” of $17,500 is, he says $17,500 is the “cash portion of my already disclosed $56,500 ‘office/residence’ where I am reimbursed for the additional costs of the office expenses, utilities, electric and internets … but I disclose all $56,500 as income.” (my emphasis)  Putting aside that he now says that $56,500 is income; cross checking this item against the Company Cash Statements he produces, the “Office Network Hosting Fee” appears as a separate item in the statements from August 2021 onwards (when the Office moved to McDonnell Road), and is therefore not part of the H’s “salary and wage”. If this amount is represented as expenses of the company and reimbursement is made to H, then this is an additional amount that H is receiving on top of his “salary and wages”. H produced AIS’s bank statements from January 2021 to October 2023 in his disputed bundle, there has been a consistent payment of $17,500 in cash going out every month from at least September 2021, while at the same time cheques payments of $56,500 (being the amount of rental) can be seen. These are two distinct amounts, and confirms to me, on a balance of probabilities, that what H says about $17,500 being cash portion of the $56,500 to be untrue; and that H is receiving an additional amount of $17,500 which is booked by AIS on its account as “Office Network Hosting Fee”.

56.  W’s counsel also present an analysis from two sets of numbers:

a.  H’s declared income from his “CEO Cash Compensation slides” appearing in both the agreed bundle being an exhibit provided by H to W’s solicitors under cover of his letter dated 19 June 2023; and also in his disputed bundle.

b.  Company Cash Statements for 2021, 2022 and from January to April 2023 under a column of “salary and wages: G V”, provided by H to W’s solicitors under cover of his letter dated 11 June 2023

57.  From the above information, W’s counsel has prepared a useful table in the annexure to his opening submission which tracks the H’s “cash compensation” (from a above) and the “salary and wages” (from b above). I have done the same thing in a different format:

	2021	2021	2022	2022	2023	2023
	All cash compensation drawn	Company Cash Statement: salary & wages: GV	All cash compensation drawn	Company Cash Statement: salary & wages: GV	All cash compensation drawn	Company Cash Statement: salary & wages: GV
January	30,000	75,200	35,436	85,594	48,877	105,376
February	44,000	89,200	46,614	46,614	7091	120,091
March	44,802	92,500	20,684	120,684	35,682	35,682
April	44,000	89,200	55,699	105,699	62,943	119,443
May	85,711	130,911	58,412	108,412
June	55,000	100,200	69,240	84,240
July	55,000	100,200	62,671	162,671
August	-100	61,600	57,406	57,406
September	40,085	90,084	62,998	119,498
October	0	50,000	46,652	103,152
November	33,500	83,500	83,481	139,980
December	74,587	124,587	53,844	110,344
TOTAL	506,585	1,087,182	653,137	1,244,294	154,593	380,592
MONTH AVG	42,223	90,598	54,428	103,691	38,649	95,148

58.  This table reveals:

a.  H’s average monthly cash compensation by the year are $42,223 (2021), $54,428 (2022) and $38,649 (January to April 2023).

b.  H’s average monthly “salary and wages” by the year are $90,598 (2021), $103,691 (2022) and $95,148 (January to April 2023).

c.  His average monthly cash compensation in the last 12 months from this information, being May 2022 to April 2023, is at $54,108 and average monthly “salary and wages” for the same period is $105,525.

d.  His income fluctuates month on month. The range of these numbers are big, ranging from $7,091 (Feb 2023) to $83,481 (Nov 2022); and “salary and wages” from $35,682 (March 2022) to $139,981 (November 2022).

e.  It has not been explained, nor my attention brought to understand what is included in “salary and wages” as documented in the Company Cash Statements, and why the numbers fluctuate through this big range.  

59.  W’s counsel has made reference to an employment contract of January 2020 which records that H is to have $195,000 per month, he repeatedly argues that this has never taken effect. However, I make reference to evidence provided by W under exhibit SG17-7 which reads “Financials - G Accrual salary”, which comes from documents prepared by H for AIS’s AGM in August 2022, this part of information reference how much money H says he has “drawn” from the company from 2019 until June 2022. It is shown that the average monthly drawn were:

2019	$204,464
2020	$116,527
2021	$89,549
2022 (up to June)	$89,238

Therefore from the numbers that H prepared himself declaring how much money he was drawing from the company, his income was at least $89,238 in the year prior to this application, and I find it strange that in his February 2023 Form E, his income has dramatically decreased to $54,428. His withdrawal amount varies, I therefore also wonder whether there is any guideline as to how much he can draw; or that he could draw anything up to $195,000; but no information has been proffered by H. It is also observed that these numbers do not match up to those in §57 above.

60.  W also says that despite H saying that AIS may become insolvent ever since his first Form E, he has continued to work there. There was no attempt on his part to find alternative employment in Hong Kong, even to supplement his income to comply with the court order. She says that this lends doubt to the veracity of his statement about his failing company.

Family Loans

61.  W says that H’s family continues to provide loans to him despite H’s repeatedly saying that they would stop sending him money. Information on these loans can be gleaned from the Exhibits to H’s third Form E, and the record of loans contained in his disputed trial bundles.

62.  First on the numbers, attached to the W’s counsel opening submission is the following list of loans from his family derived from the H’s Form E:

Year	USD Annual	HKD Annual	HKD Monthly
2017	34,066	265,714	22,143
2018	50,066	390,514	32,543
2019	21,098	164,563	13,714
2020	37,959	296,080	24,673
2021	36,352	283,545	23,629
2022	75,286	587,234	48,936

63.  The items covered by these loans include a number of payments for the S Property (common charges, washer dryer, new carpet, maintenance and upkeep, and taxes), student loan repayment, air tickets, car rental, “payments made on behalf of G”, “short term loans”, children’s tuition, and amazon purchases etc.

64.  As the input for 2023 is incomplete, I turn to the information provided by H in his disputed bundle. By my calculation, loans from his family are in the following amounts and for the following purposes for that year up to just before this hearing (decimal points removed):

Item	USD	HKD
Health Insurance	10,946	85,378
A International School	13,950	105,452
Pearson Online Academy	3,691	28,785
HK Basketball fees	1,756	13,704
Amazon purchases for kids	798	6,281
ESF	266	2,075
University of HK	1,694	13,260
Kaplan language training	1,191	9,294
Total Ticketing Ltd	243	1,900
GC Application fee	256	2,006
TOTAL:	34,791	268,135

65.  On these numbers, the assistance H receives from his family based on the information he produces was as high as $48,936 in 2022 and at least $22,345 per month for 2023. In addition to the items in paragraph 64 for the year 2023, I also take the view that the items for which loan is given recorded in paragraph 63 above continues to be provided by his family, hence, the amount of loans from them, while some may overlap (e.g tuition and amazon purchases), is more than what is documented by him for 2023.

66.  H argues against W’s allegation that there is $50,000 of monthly loan from his family. This is the wrong end of the stick. The calculation is all based on information produced by him, with the average sums from the numbers he provides. But what is more important, case law is well established that these loans, which he admits in his Affirmation that he has not repaid, is considered to be his financial resources, and will be taken fully into account.

67.  Further to the abovementioned items for which loans were made, H also says in his Affirmation that his family has paid for the legal defence in the High Court proceedings as it is a “shared” defence, although he refuses to divulge how much they have paid. At cross examination, his claimed statutory demand of $811,000 being money owed to his previous lawyers acting in the High Court action, and which he says is threatening to “bankrupt” him, had been dealt with through the assistance of his family, resulting in an “in principle” settlement of $674,614. H further says that his family has paid for all his legal fees; back in his second answer to questionnaire in September 2021, he said there were “approximately $1,000,000 outstanding to HI law firm, and $380,000 outstanding to TDW law firm”; in his cross examination, he says that his family has paid $400,000 in legal fees from August 2022 to November 2023, which averages out to at least $26,700 over 15 months prior to this hearing. This is in addition to the family assistance to the items above mentioned.

68.  As to the availability of these loans, and taking the point from the W’s counsel’s submission, these are some of the instances where H talked about loans from his family which he claims would come to an end:

a.  H’s Form E dated March 2021 at 5.5: “… if the business of AIS were to become insolvent or bankrupt. My family has informed me that they cannot continue to support me and the children living in Hong Kong with no returns. I believe that they will soon cease their financial support for me and the children….”

b.  H’s answer to questionnaire dated September 2021 at §18a “For the avoidance of doubt, my family will longer support me to live in HK once the business fails …”

c.  H’s Form E dated 28 February 2023 at 5.5: “The Father’s family after TWO years of these divorce proceedings will no longer throw good money after bad only to prolong the father’s personal bankruptcy for remaining in unaffordable HK.”

d.  H’s Affirmation at dated 29 May 2023 at §18 “My family members have been nothing but generous and supportive. But they will no longer throw good money after bad.” 

69.  Yet, these loans have continued. Tracking all the way from 2018 up to the time of this hearing. H has also said in his 2^nd answer to questionnaire (September 2021) that his family has been paying for his student loans, along with many other expenses and family support on his behalf over the last 14 years. These additional and ongoing resources from his family seems to know no bounds.

70.  It also appears to me that H would turn to his family for assistance on items he chooses, this is apparent in particular in the way that he obtained family loan for L’s tuition in an international school when P had to study at a local school during the school year 2023-2024.

H’s ability to borrow

71.  It is also H’s submission that he is servicing loans in the approximate amount of $23,000. His latest Form E shows he has personal loans / credit line from Citibank, it therefore appears that at the relevant time, he had the ability to borrow; although he now alleges that he can no longer do so. H says the loans are paid with rental from the S Property, that rental income was meant to service the property’s mortgage which H had diverted to cover his loan repayments and he had allowed the mortgage payments to lapse resulting in a foreclosure of this matrimonial property. My attention was not brought to any disclosure as to what happens to the equity portion of the S Property after the foreclosure proceedings.

72.  In trying to pull these threads together, H’s financials have continued to be the mystery that HHJ Melloy alluded to back in August 2021. H has once again obfuscated the Court as to his true financial position and left the Court with no choice but to make the necessary inference in the circumstances.

H’s Expenses

73.  W also argues that H has not make any changes to his standard of living, this includes inter-alia:

a.  Continuing to reside at the former matrimonial home at the McDonnell residence paid by AIS at $56,500 per month, saying it is “impossible” to move to a smaller place.

b.  Despite saying that he cannot afford to pay for school fees, he managed to source a loan from his family members to pay for only L’s school fees at the A International School, and was also considering the even more expensive HK International School; while his younger son (in W’s care and control) had to go to a local school as H says he could not pay for his school fees.

c.  H incurs expensive private insurance at a total of $85,379 for the year 2023.

74.  W argues that H’s expenses in both Form Es are more than his declared income. The first Form E in 2021 records an income of $87,800 and expenses at $146,156, both numbers include rental at the then discounted rate of $45,200; on his own numbers, H’s deficit was $58,356. For his February 2023 Form E, his income was $54,428 and his expenses were $109,909; again on his own declaration, he is in deficit of $55,481. His declared expenses therein include the $44,000 which he is not paying in full most of the time; and I must also consider that his spending is actually more than those numbers that he declares in his Form E if one takes into account the amount of money that has been paid on his behalf by his family, to say the least, for items such as tuition, insurance, amazon purchases and extracurricular activities etc.

75.  I have listed out the comparison of H’s expenses from his two Form Es below:

Items	Form E dated 16 Mar 2021	Form E dated 28 February 2023
General
Rent (lease in AIS’s name paid for managing director – GV)	45,200	0
Mortgage instalment – US property	USD1,580      HK$12,268	0
Utilities	3,500	3,500
Food	15,000	15,000
Household expenses	2,000	2,000
Domestic Helper	7,000	7,000
Others	0	22,869
Subtotal	84,968	50,369
Personal
Meals out of home	3,000	1,000
Transport	1,000	500
Clothings / shoes	1,000	250
Personal grooming	500	200
Entertainment / presents	2,000	500
Medical / Dental	1,000	0
Insurance - Co paid by company - Personal life	1,941 2,403	5,000
Interim Maintenance	14,000	44,000
Others – monthly charges for US property	USD477 HK$3,710	2,000
Subtotal	30,554	53,450
Children
School Fees	15,000	0
Extra Tuition	2,000	0
School books and stationery	500	0
Medical / Dental	500	0
ECA	2,500	1,000
Entertainment / Presents	3,000	1,000
Clothings / Shoes	1,500	1,000
Insurance premia	USD500 HK$3,882	0
Lunches / pocket money	1,000	500
Other transport	500	1,500
Uniform	250	0
Others		1,000
Subtotal	30,632	6,000
TOTAL	146,156*	109,909**

*should be 146,154

**should be $109,819

76.  Commentary on Expenses:

a.  H’s rental expense was $56,500 and at the time of the hearing, was paid by AIS; and School fees for L at an international school was paid for by his family members (at $13,730 per month), neither of these numbers appear in his 2023 Form E.

b.  W has commented that his utilities are excessive. In his reply, H says that utilities are “understated as IT servers drain electric, and there are extra internet and costs to support the “Office/Home’”; in this context, he omits to mention that he receives $17,500 from his company (labelled “Office Network Hosting Fee”) in subsidy for these costs as explained in his Affirmation.

c.  W says that he spends $15,000 on food alone for himself and L, which is at times more than the maintenance he paid to her for a month. F explains this included $5000 worth of groceries he provides to W. It is inexplicable that he chose to send her food instead of giving her cash to allocate as she deems appropriate.  This $5,000 is also more than the number H declared that he paid for W’s groceries in his “Good Faith” payment in his submission.  Even with the exclusion of this amount, $10,000 is a large amount of money for food items for an adult and a child.

d.  After challenged by W that he is paying $5,000 on insurance, he then says in his Affirmation that it should be $2,400 and that he “made a mistake to OVER estimate”. Cross referencing this payment on insurance against the loans his family made for him on this item, from October 2022 to September 2023, payments by his family for health insurance was $112,561, which makes it $9,380 per month.

e.  Counsel for the W also submits that H has continued to spend significant sums on wine, dining out and spending at premium grocery stores; and that he does not live like he is in the dire financial circumstances he claims. When challenged under cross examination, his answer was “my parents ask me to make sure the kids eat well.”

f.  For the $22,869 under “Other” of General Expense, he says this amount includes his and Children’s medical insurance, clothing, and activities, gifts and presents. Again, it is incomprehensible why H cannot plot these amounts properly where they rightly belong in the Form E.

g.  He then also says “I put an estimate for ‘other expense’ at $2,000 and Transport of $1,500 at a low amounts because Other Expenses were inflated.” 

h.  He has not been paying monthly charges on the US property as this amount appear in the payment made by his family members, at least from 2018 to 2022.

i.  The expenses for child have decreased substantially as a big part of this is paid for by his family.

Looking at these numbers and his narrative, I can only attach little weight to the expenses he declared, his explanations for his numbers make them impossible to be taken seriously, and the picture is not complete as a big part of these expenses is being paid for by his family. His expenses are exorbitant, do not look like someone in dire financial situation, and always seem to be well covered with the assistance of his family.

77.  There is in evidence some credit card statements in the agreed bundles, this is H’s HSBC bank card. The way that this seems to be managed by him was that consistently, H has put money into the credit card via cash or “IFS payment” to set off his purchases. Each month the credit and the purchases with the credit card would more or less balance off:

	CR ($)	Purchases ($)
Sep 2022	23,000	19,137
Oct 2022	34,000	34,230
Nov 2022	26,000	24,669
Dec 2022	36,200	28,738
Jan 2023	18,200	22,034
Feb 2023	26,600	23,605
March 2023	25,500	25,859
April 2023	28,975	25,081
May 2023	29,300	27,026

78.  The nature of the spendings in this credit card are mostly groceries, household expenses, food, alcohol purchase, and some minor sums in utilities / subscriptions. The above shows no trend of reduction of spending and well exceeds his declared expenses in his Form E for food and utilities combined of $17,000 (which is challenged as excessive). I also recognize that these are items so spent using this credit card, and as H has a domestic helper, there is a high probability that some of his general expenses would be paid for by cash, which could make those items of expenses larger than the amount declared.

H’s Non-Disclosure

79.  M says she has written to H at least twice a few months before this hearing, asking him to produce information.  But not all information was forthcoming. H claims that he has provided more information than that requested by W but from what I see, he has been selective in his disclosure.

80.  H has failed to provide information regarding how much H’s solicitors in the High Court proceedings were paid and what was the source of funds. Although he did eventually say in the letter to W’s solicitors in June 2023 that these are loans from his family.

81.  Perusing the joint bank account statements from HSBC (which were exhibited to his Form E of February 2023 labelled “banks statements of last 12 months” but there were still gaps in this disclosure), they show that during the relevant time before this Form E, money were deposited and then almost immediately and at around the same amount would be transferred to account number 043-xxx125-001 consistently. There was no disclosure as to what is and who owns this 043 account.

82.  I also make the observation that H has only ever declared two bank accounts in his Form Es before me in this hearing, one is with Citibank in the USA, and the abovementioned joint account with W at HSBC, which balance is kept very low and as of his last Form E for this application, the balance was $5. Yet he manages to maintain a credit line of $72,000 on his HSBC credit card.

Conclusion on H’s financial position

83.  In conclusion, I am of the view that H has the ability to pay for the maintenance made in the August 2021 Order.  I base this view on the myriads of numbers representing his income as above analysed, he appears to draw more money from AIS as his income from before, he has also failed to report the reimbursement of $17,500 as an additional income; flow of loan from his family members continues; and the inference I shall draw from his failure to make disclosure particularly regarding the 043 account which would have shown where all the money he deposited into his joint account has gone to, and the extent of payment his family has provided for his various legal fees as this should further address the extent of the bounty he enjoys from this source of financial assistance. H has also on-going spent more than his declared income, this habit of continually living beyond his means is inconsistent with someone who claims to be in a debt spiral and which clearly points to a credibility issue on his part; and / or it shows someone who is ill equipped in managing his own finances, and whose financial shortfall is regularly covered by his family coming to the rescue.  On a balance of probabilities, I conclude that he has financial resources at hand; and has been and will be able to pay for the maintenance order previously made as well as the one that is going to be made in this decision.

C.  W’s employment, earning capacity and financial status

84.  According to W’s January 2021 Form E, she was unemployed and therefore had no income.

85.  Per her Affirmation on May 2023, she says she has:

a.  $4,442 as at 6 May 2023

b.  Credit Card liability of $2,567 as at 17 May 2023

She also stated through her solicitors in around August 2023, that she had borrowed from a friend SC $130,000.

86.  It is not in dispute that W’s skill is in tailoring. She had a business back in the US, but not in HK; as she was mainly a housewife and carer for the Children.

87.  It is M’s case that as P lives with her, and still young, she still needs to look after P and cannot find a full-time job. Unlike H, she does not have the means to engage a domestic helper.  H has always been the main breadwinner; W is fully dependent on H financially, and she has been out of the work force for a long time.

88.  It was accepted by HHJ Melloy in the August 2021 decision that W’s earning capacity is limited. H’s proposition was to take over the care of P so W can work full time; she disagrees.

89.  I agree with the Judge. It is not accepted that M has no earning capacity, in her own Affirmation, she has cited options, which are reasonable. Although I do acknowledge and accept that she should be better able to settle down to organise her life better and find proper employment when these litigations are over.

90.  For the purpose of this decision. I will accept W’s earning capacity to be $5,000 per month.

D.  Wife and Children’s Needs

W’s Needs

91.  W submits that as her previous Form E dates back to January 2021 which is clearly out of date, she has listed her reasonable expenses in her May 2023 affirmation, and not what she is spending now as she has to live a really frugal life due to the H’s deficient support.

92.  The following is taken from her May 2023 Affirmation:

Item	Amount ($)
General
Rent	25,000
Utilities	1,500
Food	6,000
Household Expenses	1,500
	$34,000
Personal
Meals out of home	2,000
Transport	1,000
Clothing / Shoes	1,000
Personal Grooming	1,000
Entertainment / presents	1,000
Holiday	2,000
Medical / Dental	500
Insurance premia	3,000
Others (gym membership)	1,200
	$12,700

93.  H did not challenge her expenses in his reply except to complain about her gym membership.

94.  W’s counsel submits that as part of her efforts to economize, W has to move house and her November 2023 bank statement shows her paying rent at $19,000. In the decision to follow, I have taken this number into account.

95.  Approaching MPS on a broad-brush basis; I take the view that the General Expenses is to be $8,000 on top of rent, and W’s personal expenses to be $11,000. I also acknowledge this is a step-down from her marital standard of living, she is living in a smaller apartment, has less money to spend on food and herself, and does not have the assistance of a domestic helper.

P’s Needs

96.  The following table shows W’s position on reasonable expenses for P:

Item	Amount ($)
School fees*	12,230
Extra tuition	1,054
School books and stationery	200
Transport to school	N/A
Medical / Dental	300
ECA	3,000
Entertainment	1,000
Holidays	2,000
Clothings/shoes	500
Insurance Premia*	1,700
Lunch / pocket money	1,000
Other transport	500
Uniform	150
Others	500
Subtotal	24,134

97.  I find the above numbers to be reasonable. Net of school fees, W has assessed P’s needs to be around $11,904, I will adopt $12,000.

Education expense for P

98.  H has previously been directed to pay for school fees which he obviously had failed to do. When H failed to pay for school fees for the school year 2022-2023, W had to sell her only valuable item, her wedding ring, in order to pay for P to stay in the same school.  For this, she suffers ongoing criticism from H for what she did for the son in her care. When the sale proceeds of the wedding ring ran out, W had no choice but to place P in a local school for the two school years 2023-2025. During this time, H sourced family loan to place only L in an international school for one year, but did not do so for P. H then further criticizes W (again) for placing P in a local school as his grades were declining, when it was clearly his own doing that creates this state of affairs for P. It has not escaped this Court’s notice that P is probably struggling in a local school, it is in his interest that he studies in a school which offers English as a medium of instruction; and W should be put in funds to pay for this.  There is however a concern that H would not comply with a maintenance Order as he had in the past, enforcement will be an issue as H is likely to be in the US, this will no doubt leave P in a limbo.

99.  Be that as it may, I decide to make an ambitious Order in P’s interest in terms of $14,000 per month for his tuition, and conscious that this item of expense will increase with time as P moves up in secondary school year on year. This should start for the school year 2025 - 2026 if possible or as soon as practicable when a placement can be secured for P.  This makes the total maintenance for P to be $26,000 per month.

Should the proceeds of the wedding ring be taken into regard to set off outstanding maintenance

100.  H has spent a substantive part of his evidence and submission challenging the sale of this ring, he says W has under-reported the value of the ring, and he even at some point doubted if it was sold; he then reported her to the police for falsifying a GIA certificate and said that W has made fraudulent misrepresentation. He also said that he has obtained another GIA certificate which was different from that of the W’s.

101.  W explains the need to sell the ring in her Affirmation; this she did to provide money to pay for P’s schooling as H says he has no money. It was accepted by her that she did report her valuables as $50,000 only in her first form E (for which she was heavily criticized as under-reporting). But W did obtain a GIA certificate in April 2021 (No.73xxxx9357) afterwards and produced a receipt for obtaining this GIA certificate. H produces a GIA certificate from 2003 which shows slightly different characterization of the diamond and accuses her of falsifying her GIA certificate. W has also provided the Whatsapp conversation she had with the jeweller prior to the sale and then provides the receipt dated 9 March 2022 for the sale of the diamond ring for $152,100. A subsequent GIA report obtained by H online was dated 11 April 2022 which was after the date W sold the ring, this latter GIA report shows the same refence number of 73xxxx9357, but described the “cut grade” differently.

102.  Confusion of the various description of the diamond aside, at all times, there was only one diamond ring. H’s allegation that W has falsified the GIA certificate has no basis nor evidence in support, nor did he successfully challenged the sale price received by W.

103.  W has gone on to say that she has spent $115,420 of the sale proceeds to pay for P’s tuition at YCA for the year 2022-2023, and some ECA classes but was not able to pay for the last three months of that school year leaving April to June school payment outstanding, because she needed to prioritize the payment of rent.

104.  I accept W’s evidence in this regard, the proceeds she received, and how it was spent.

105.  H has asked for the sum of the sale proceeds to count towards the payment of maintenance. This is a ring belonging to W which was declared in her Form E, and is a matrimonial property. While acknowledging she has no choice but to sell this item for P to stay in the same school, this is nevertheless an asset which needs to be taken into consideration as the parties’ matrimonial asset. To that end, I will allow the amount of $152,100 to be treated as payment of maintenance, and this is the amount which is to be net off from the outstanding maintenance that H’s owes.

H’s Good Faith Payments

106.  H claims that for the $131,500 “Good Faith” payments he paid to the W should be used to set off his outstanding maintenance to W. I do not agree with this approach. Not only do I have no reference to the supporting documentation for these payments, if these were made, they were done voluntarily, and will not be considered as satisfying his obligations under the August 2021 Order.

The Previous Decision in August 2021 and Backdating

107.  In relooking at the decision made by HHJ Melloy in August 2021 wherein she made an Order for $44,000 in total with a provision of $28,000 for rental. This actually leaves only $16,000 for W, L and P in the context of the Judgment for everything else other than school tuition which the F has been directed to pay. In my view, this sum was less than adequate for W, L and P; and extremely modest for a household with W and P, and with L occasionally visiting. While the Judge commented that H’s financial situation is unclear, she also concluded that he has disposable income to pay the Order that was made.

108.  Looking at this in the round and on a broad-brush basis, I do not see fit to change the amount of maintenance made in the August 2021 Order.

Conclusion

109.  In my assessment, there has been no material change in circumstances that justifies a variation to the August 2021 Order.  H appears to draw more income from AIS over the two years prior to his application, he has an additional reimbursement amount for housing the AIS’s computers, printers, and servers etc at the McDonnell residence. His spending remains consistent, and he always manage to keep his credit card balance consistent. I take the view that he has under-reported his expenses in his recent Form E. The loan from his family has been ongoing, and even more so in the recent years in paying for his legal bills, which he has refused to disclose as to the exact amount.  H also says he has lost the income from the S Property when it was foreclosed, this could not be right as the declared $14,000 rental income should have been used to serve the mortgage payment which he reported in his earlier Form E to be US1,580; hence there was not much net income from that property in the first place.

110.  I shall therefore dismiss the H’s variation application; and in considering the circumstances de novo, make the following adjustments to the previous maintenance Order.

111.  In summary:

a.  The maintenance amount made in the original August 2021 Order of $44,000 stands until October 2023, the month before this hearing.

b.  From November 2023 until c below, I am making a minor adjustment for M’s change of residence and her earning capacity: and assess:

1.  General expenses $28,000 (factoring $20,000 for rental and $8,000 for other general expenses),

2.  W’s MPS $6,000 ($11,000 - $5,000, the latter being her earning capacity),

3.  P’s maintenance $12,000.

The split shall therefore be MPS of $20,000 for W, and maintenance of $26,000 for P. Totalling $46,000.

c.  From the month P secures a placement in a more appropriate school until further Order, P’s maintenance shall be increased by $14,000, making it $40,000. Therefore making the total amount $60,000.

112.  At the time of the writing of this Judgment, W has given consent for H to permanently remove L to the USA. H has all the while repeatedly says that they will have free accommodation in the US, general needs taken care off and “affordable private school”; while he “get back on his feet”. H has informed this Court that he will be receiving salary for working for his family; he will invariably continue to have financial support from his family. His duty to maintain the W and P continues, and I am of the view that he has the capacity and the resources to pay for the revised maintenance going forward.

Costs

113.  H has clearly failed in his application to vary down his maintenance payment. The only minor headway he made was to have the sale proceeds of the wedding ring taken into account. Considering the arguments he made in this latter issue and his inability to substantiate his allegations and the fact that he has left W with no choice but to sell the wedding ring due to his non-compliance of a court order, I am on the view that the Cost of this application should be to the W.

Order

114.  I shall make the following Orders:

a.  The maintenance Order made in August 2021 of $44,000 do stand and continue until October 2023.

b.  From November 2023 until such time as P commences schooling in an appropriate school, H to pay $46,000 per month to commence on 1 November 2023 and thereafter on the 1^st of each month, being $20,000 for W and $26,000 for P.

c.  From the month P commences schooling at an appropriate school until further order, H to pay $60,000 per month to commence on the 1^st of the aforesaid school commencement month and thereafter on the 1^st of each month, being $20,000 for W and  $40,000 for P.

d.  The Costs of H’s variation application, including all costs reserved, be to the W; with legal aid taxation and certificate for counsel. This to be a Costs Order nisi to be made absolute within 14 days hereof.