S v. P

FCMC 9609/2000

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 9609 OF 2000

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J U D G M E N T

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Application

1. This is a trial of the Respondent’s summons dated 14 April 2005 for a downward adjustment of the periodical payments he is now paying towards the maintenance of the child of the family.

2.  Although the parties have divorced long ago, I shall continue to refer to the Respondent as the Husband and the Petitioner as the Wife for the sake of convenience.

Background

3.  The Wife is now aged 44 and the Husband aged 50. They married in 1994 and are both librarians by occupation. Within wedlock, a daughter, A was born who is now aged 11.

4.  The Wife filed a petition for divorce in the year of 2000. A decree nisi was granted on 2 March 2001 by Deputy Judge Chainrai together with an order embodying the parties’ agreement on the issues of custody, access and financial relief (“the Maintenance Order”). The more important terms of the Maintenance Order included:

(1)  The parties shall have joint custody of A with care and control to the Wife and reasonable access to the Husband;

(2)  There shall be clean break between the parties;

(3)  The Husband shall pay a monthly sum of $20,000 for A’s  financial support from the date of order to the date of Decree Absolute; and

(4)The Husband shall pay a monthly sum of $14,000 for A’s financial support as from the date of Decree Absolute until A finishing secondary school education, which sum shall be adjusted every 2 years to reflect inflation or deflation, such adjustment to be established by reference to the Hong Kong Consumer Index (Composite) published by the Hong Kong Government.

5.  Decree Absolute was granted on 2 May 2001.

6. The Wife re-married with another gentleman (“PH”) in 2002 and in that new marriage, a son (“EH”) was born to the Wife. 

7. Pursuant to the parties’ agreement, the maintenance for A has been reduced to $13,320 in January 2004 after adjustment in reference to the deflation experienced by Hong Kong before that period.

8. In addition to the maintenance of $13,320, the Husband is also paying a monthly sum of $5,302.50 for 10 months in a year being the education allowance he has received from his employer towards the education of A. It is not in dispute that this is not a direct out of pocket payment from the Husband. The only financial implication of this transfer of fund on the Husband is the additional tax liability to be incurred because the said allowance would be treated as the income of the Husband.

9. As far as the reasonable access to A is concerned, at the time of the Maintenance Order, the then arrangement was that:

(1)  Over a period of 14 normal school days:

(a)   1 Saturday night staying access;

(b)  3 evenings visiting access.

(2)  During school holidays:

(a)   one 10 days staying access;

(b)  another 7 days staying access in alternate years;

(c)  one up to 2 weeks staying access during the summer holidays.

10. However, significant changes on access were effected by mutual agreement as from the year of 2004. The latest arrangement is as follows:

(1)   Over a period of 14 normal school days, 6 nights staying access;

(2)   During school holidays:

(a)   2 periods, each to last from 3 days before to 3 days after, alternating every year for Fall Break, Christmas, Chinese New Year and Easter;

(b)  30 days staying access during every alternate summer holidays;

(c)  These holidays staying access are for overseas trips with A and if the Husband shall decide to stay in Hong Kong, the staying access arrangement during normal school days shall apply.

11. On 14 April 2005, the Husband took out the present application for further variation of the Maintenance Order downward.

The Husband’s Arguments

12. As far as I can gather from the Husband’s case, his arguments run like this:

(1)  With the latest arrangement on access, it effectively means that near to half of A’s time is now with the Husband, which is a substantial increase from the previous arrangement.

(2)  With this substantial increase in access time, the Husband has incurred more expenses, not only proportional to the increase in access time, but some extra expenses were also incurred. That would include items like the hiring of a full time domestic helper, buying extra school uniforms, stationeries and toiletries, etc. According to the Husband, all these extra expenses were not necessary under the old schedule on access.

(3)  The increase in holiday access means that there would be more traveling for A and again this means extra expenses.

(4)  The Wife has remarried in 2002 and so her financial burden on household expenses must have been lessened by the contribution made by her new husband.

(5)  As to the parties’ respective income, the Husband contends that his salary has been cut by 3 % for the last 3 years whilst the Wife has secured a new job with income and benefits higher than his.

13. With all these changes in the circumstances, it is the Husband’s case that he should be allowed to stop the payment ordered under the Maintenance Order.  

The Wife’s Arguments

14. The Wife was unrepresented at trial. Her case is quite straight forward and runs as follows:

(1)  The increase in the Husband’s access to A does not mean that the Wife’s expenses on A have decreased. As A is now growing into her adolescence, there has been an increase in every aspects of A’s expenses to be incurred by her.

(2)  Some of the Husband’s increased expenses on A are not reasonable. The most obvious one is the 3 overseas trips for A per year which is obviously excessive.

(3)  Under these circumstances, it is the Wife’s case that the present level of maintenance payment by the Husband should be maintained.

The Law

15. I think it is always convenient to start with the law governing the variation of maintenance orders. That can be found in Section 11 of the Matrimonial Proceedings and Property Ordinance, Cap.192 (“MPPO”) which is as follows:

“11. Variation, discharge, etc. of orders for financial provision

(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.

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(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.

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16. The proper approach that the court should take in exercising its discretion under this section can be found in the English Court of Appeal case of Lewis v. Lewis [1977] 1 WLR at 409 in which it was held:

“----- that the powers of the court when dealing with an application to vary a periodical payments order were not confined to considering the alteration in the actual means of the parties; that under section 31(7) of the Matrimonial Causes Act 1973 [equivalent to our section 11 (7) MPPO] the court was required to have regard to changes in any of the matters mentioned in section 25 of the Act of 1973 [equivalent to our section 7 MPPO] and therefore, the judge was right to look at all the circumstances as they were when the case was before him and to make an order that was reasonable in those circumstances.”

17. A similar approach was adopted and developed upon by the local court in a more recent case of K v. K, DJ No. 5 of 1986, 11 December 1997 in which Deputy Judge Hartmann (as he then was) had the following to say at paragraph 12:

“In considering an application of variation, I am not required to proceed from the starting point of the original order but must look at the matter de novo although obviously any material change in the matters to which the Court was required to have regard when the original order for maintenance was made are of relevance. In my judgment, therefore, in matters of this kind I should adopt the approach in Flavell v. Flavell [1997] 1 FLR 353 (at 357G); namely, to look first at the present situation, examine the basis of the original order, consider events since that order was made and decide what is fair in the light of those matters.”

18. I do not think the principles as expounded in the above cases are disputed by the parties.

Change of Circumstances

19. It is not in dispute that circumstances have changed. A is now spending more time with the Husband. The Husband is taking more trips with A each year. The Wife has remarried. A has grown. These changes in themselves are not that important as far as the maintenance for A is concerned. What is important is the financial implications on the parties brought about by these changes.

Husband’s Financial Position

Income

20. The Husband is working as a librarian for a University in Hong Kong with the following income:

(1)  A salary of $72,780 per month (there is no dispute that it is 3% lower than 2001);

(2)  An average monthly education allowance for $4,418.33 ($5,302 x 10/12 = $4,418.33);

(3)  A monthly gratuity of $10,917 (in lieu of pension); and

(4)   An average travelling allowance of $923 per month ($11,083 for a year).

The Husband’s average monthly income amounts to $89,038.33.                      

21. One would see that I have averaged out the education allowance which the Husband has received for 10 months only in a year ($5,302 for a month) from his employer. The present arrangement is that the Husband just pays over this allowance to the Wife together with the monthly maintenance for A at $13,320.

Assets

22.  As to his net assets position, the Husband has :

(1)	3 bank accounts with HSBC	$42,575
(2)	2 investment accounts (Smith Barney)	$2,601,856
(3)	BMW Car	$120,000
(4)	MPF/Pension	$928,607
	Sub-total:	$3,693,038
	Less Liability
	Smith Barney Portfolio Credit Line	$263,500
	Net Assets:	$3,429,538

Expenses

23. The Husband has listed out his monthly expenses as follows:

General Expenses
Rent	$5,459
Utilities	$1,700
Food	$4,600
Household Expenses	$3,050
Car Expenses: maintenance 70%	$3,000
PCCW broadband	$162
Sub-total:	$17,971
Personal Expenses
Meals out of home	$1,300
Transport	$600
Clothings/shoes	$1,500
Personal Grooming	$200
Holidays	$8,909
Medical/dental/optical	$4,166
Insurance premia	$330
Interim Maintenance	$13,320
Dependent Family	$440
Bank of America Tax Loan	$17,136.33
Classes and class material	$2,300
Study Trips (Spain)	$1,750
MPF	$2,000
Smith Barney	$15,690
Sub-total:	$69,641.33
Expenses on A
School fees	$4,418.33
Extra-curricular activity	$975
School books and stationery	$100
Medical/dental/optical	$192
Entertainment/presents	$2,500
Holidays	$3,256
Clothings/shoes	$300
Insurance premia	$215
Lunches & pocket money	$100
Car maintenance 30%	$1,200
Child-minding fee	$4,300
Uniform	$84
Toiletries	$200
Transport to School	$50
Two cats	$500
Legal fees	$4,086.91
Sub-total:	$22,477.24

The grand total of the Husband’s monthly expenses amount to $110,089.57 ($17,971 + $69,641.33 + $22,477.24 = $110,089.57).

24. According to the Husband, he is now suffering a monthly deficit of $21,051.24 ($89,038.33 - $110,089.57 = $21,051.24). As he is not in a position to sustain this deficit any longer, he is now asking the Court to cancel the $13,320 monthly sum he is now paying to the Wife for A’s maintenance.

25. At trial, the Wife has raised a number of challenges to the above expenses.

General Expenses

26.  For the general expenses of $17,971, overall speaking, I am of the view that they are not unreasonable for a household of 3 persons (the Husband, A and the maid).

Car Expenses

27. Having said that, I notice that among the Husband’s general expenses, there is a monthly item of $3,000 representing 70% of his car maintenance cost with the balance of 30% ($1,200) attributable to the expenses of A.

28.  The item concerns with the maintenance of a new BMW car purchased by the Husband recently. I trust that the main user of this vehicle must be the Husband and any use for A’s purpose has to be incidental. I do not think it is fair to attribute 30% of the maintenance cost to A. I would allow 10% of the cost as attributable to A, i.e. a monthly sum of $400.

29. As to the balance of $3,600 ($4,000 - $400 = $3,600), I would put it under the Husband’s personal expenses.

Personal Expenses

30. For the personal expenses of the Husband, the starting point is of course that a person is entitled to spend his income in whatever manner as he pleases. However, if one’s personal expenses are so high that they start to affect his ability to cater for the needs of his dependent, then these expenses have to be subject to the scrutiny of the court.

Holiday Expenses

31. The first item of concern is the monthly expenses of $8,909 for holidays. I understand that for the relevant year, the Husband has taken 6 overseas trips, out of which 3 were with A and 3 were his personal trips. For some of the trips with A, the Husband has also brought the maid and the maid’s daughter along and paid for their expenses as well. The Husband’s explanation was that he wanted A to have company.

32. If one also takes into the account of the holiday expenses of A at $3,256 per month, one would see that the Husband is actually spending a monthly sum of $12,165 (i.e. an annual sum of $145,980) on overseas trips alone. This represents 13.66% of his income. Common sense tells us that it is much too high a percentage and there is certainly much room for savings in this regard. I would allow the respective monthly sums of $3,500 and $2,800 for the Husband and A’s holiday expenses, which are the same amounts as claimed by the Wife for her and A’s holiday expenses (Bundle p.1030-1031).

Medical/Dental/Optical Expenses

33. The next item for consideration is the medical/dental/optical expenses. The Husband is saying that he pays $4,166 per month on this item, i.e. $49,992 per year. It is not in dispute that the Husband, as an employee of the Hong Kong University, is entitled to free or subsidized medical and dental services. I think the main component of this seemingly large medical/dental/optical bill comes from the Husband’s Lasik operation on his eyes. We all know that such operation is not really a necessity and also should not be a recurring item. Although the Husband’s first operation was not too successful and he is thinking of doing a second one, in order to be fair to all parties, I would allow a monthly sum of $1,000 only under this heading.

Interim Maintenance

34.  As to the interim maintenance of $13,320, it concerns with the maintenance that the Husband is paying at the moment. In order to complete the picture, I think it is necessary to add the sum of $4,418.33, that being the education allowance which the Husband is paying over to the Wife. These 2 items make up the total sum of $17,738.33 per month.

35. Furthermore, I am think it is fair to put this sum under A’s expenses instead as the personal expenses of the Husband.    

Dependent Family Expenses

36. There is also an item of $440 for dependent family’s expenses. I understand this to be a sort of subsidy the Husband has paid to his sister to come to meet him during his travel to the US. I agree with the Wife that this item is totally unnecessary.

Study Trips to Spain

37. The Husband has put down in his latest expenditure list (Schedule D enclosed in Counsel’s opening submission) (“Schedule D”) that he is paying a monthly sum of $1,750 for his study trip to Spain. However, at trial, it turned out that it is not a yearly event. The Husband said it was something that he would like to do every year but was unable to afford to do so.

38. Although the Husband is not paying this sum at the moment, I see that the Wife is also spending an even higher sum for pursuing her own academic studies, I see no reason why the Husband should not be allowed some money for his study. I will allow this item in full.

Smith Barney

39. As I understand it, Smith Barney is an investment house in which the Husband has maintained some investment accounts. The Husband said he would like to maintain a regular contribution to his accounts for investment or savings towards his retirement. This is not possible at the moment because he can not have any saving with the present level of maintenance towards A.

40. I am afraid I can not categorize this as an expense although I would certainly take into account the Husband’s wish to save for his retirement when I decide on his responsibility towards A’s maintenance.

A’s Expenses

Entertainment/presents

41. In Schedule D, the Husband has put down that he spends a monthly sum of $2,500 for A’s entertainment and presents. According to the Husband, the $2,500 includes presents like laptop computer, bicycle, badminton racquets, etc. I have no doubt that $2,500 per month could have been spent by the Husband on buying presents or providing entertainment for A, but the question is: Is it really necessary or reasonable for such expenses to be spent on a girl of 11, bearing in mind that the Husband has less than half of A’s time with him?    

42. Whether an expense is necessary or reasonable has to depend on the circumstances. In the context of this case, I understand that the Husband is a professional librarian with a reasonable pay. He earns $89,038.33 a month and is single. However, he complains that he runs into deficit every month with no opportunity to save for his retirement. I am of the view that there is much room for savings in this entertainment/present item. I think $1,000 per month is more reasonable.

A’s Holiday Expenses

43. I have already mentioned above that I do not think it is necessary to take A out of Hong Kong for 3 times a year under the rather stringent financial conditions as claimed by the Husband. I would allow a sum of $2,000 (the same as the Wife’s claim in this regard).

Car Maintenance

44. As I have said in paragraph 28 above, I would only allow a sum of $400 as A’s share of the cost towards the maintenance of the car.

Child-minding Fee

45. According to the Husband, he has to hire a domestic helper because A is now spending more time with him. He said the whole cost of the helper should be attributable to A because if there has not been any increase in access, he would not have hired the helper at all.

46. It is not in dispute that the domestic helper is also serving the Husband in looking after his household. I think it is fair to put this whole item under the Husband’s general expenses instead of under A’s expenses. Of course, in the final calculation, a certain % of the general expenses should be treated as A’s expenses as well because she does live in the household for a considerable period of time in a month.

Two Cats

47. I understand that A has already kept 2 dogs at the Wife’s residence. Two more cats are not necessary. This item will have to go.

Legal Fees

48. I understand that this item of legal fee related to a previous litigation between the parties. Legal battles are fought between adults, not children. They were the fees of the Husband. I will count this as the Husband’s personal expenses, but not A’s.

Summary of the Husband’s Reasonable Monthly Expenses

49. By adding up the above, I have come to the following assessment of the Husband’s reasonable monthly expenses:

General Expenses
Rent	$5,459
Utilities	$1,700
Food	$4,600
Household Expenses	$3,050
PCCW Broadband	$162
Domestic Helper	$4,300
Sub-total:	$19,271
Personal Expenses
Meals out of home	$1,300
Transport	$600
Clothing/shoes	$1,500
Personal Grooming	$200
Holidays	$3,500
Medical/dental/optical	$1,000
Insurance premia	$330
Bank of America Tax Loan	$17,136.33
Classes and class material	$2,300
Study Trips (Spain)	$1,750
MPF	$2,000
Car Expenses	$3,600 (transferred from general and A’s expenses)
Legal fees	$4,086.91 (transferred from A’s expenses)
Sub-total:	$39,303.24
Expenses on A
Maintenance Payment	$17,738.33
Extra-curricular activity	$975
School books and stationery	$100
Medical/dental/optical	$192
Entertainment/presents	$1,000
Holidays	$2,800
Clothings/shoes	$300
Insurance premia	$215
Lunches & pocket money	$100
Car maintenance (10%)	$400
Uniform	$84
Toiletries	$200
Transport to School	$50
Sub-total:	$24,154.33

The grand total of the Husband’s monthly reasonable expenses is $82,728.57 ($19,271 + $39,303.24 + $24,154.33 =$82,728.57).

50. Since the Husband has a monthly income of $89,038.33, I am of the view that the Husband should have a monthly surplus of $6,309.76 ($89,038.33 - $82,728.57 = $6,309.76).     

Wife’s Financial Position

Wife’s Income

51. For the Wife, she is now working as a librarian with a tertiary education institute with the following income:

(1)  A monthly salary of $89,001;

(2)  An average monthly gratuity of $8,900 (the Wife will get 10% of her total salary as gratuity after the completion of a 3 years contract);

(3)  Monthly rental of $10,500 from a property she owns in Discovery Bay (“the Discovery Bay Flat”);

(4)  Monthly rental of $9,000 from a property she owns in Sceneway Garden, Lam Tin (“the Sceneway Garden Flat”);

(5)  Monthly maintenance by the Husband at $17,738 (this is inclusive of the education allowance given by the Husband’s employer); and

(6)  An average monthly income of $1,800 for some extra teaching undertaken by the Wife.

According to the Wife, her total monthly income amounts to $136,939.

Wife’s Assets

52. As for the Wife’s capital assets, there is some dispute on the valuation of the properties she is holding.

53. For the Discovery Bay Flat, both parties have produced different estimations on its present market value. The valuation produced by the Wife is from the Hang Seng Bank which put the Discovery Bay Flat at $2,940,000 whilst the Husband gave a different estimation by the HSBC for the property at $3,180,000.

54. I notice that both these estimations are not formal valuations. They are just quotations obtained from the respective banks over the internet. In order to resolve this issue, I am prepared to adopt a median figure of $3,060,000.

55. Since the outstanding mortgage of the Discovery Bay Flat is $1,205,244 (Exhibit P4), I am satisfied that the present net value of the Discovery Bay Flat is $1,854,756.

56. As to the Sceneway Garden Flat, there is no dispute that the present market value is $3,670,000. With an outstanding mortgage debt of $2,350,000, the net value of the property stands at $1,320,000.

57. The Wife also owns a third property at Baguio Villa (“the Baguio Flat”) which is the present matrimonial home of the Wife’s new family. The market value of the property is $4,470,000 (Exhibit R5). It is not too clear from the evidence on the outstanding mortgage debt on this property. But I see that when the Wife purchased the Baguio Flat in April 2005, she has taken out a mortgage loan of $2,800,000 with a monthly repayment sum of $19,012. Now it is 16 months after the purchase, I would roughly estimate that the outstanding mortgage loan should stand at about $2,650,000. In other words, I am going to estimate the net value of the Baguio Flat at $1,820,000 ($4,470,000 - $2,650,000 = $1,820,000).

58. According to the Wife’s latest supplemental information (Bundle A3, p.1028), her total bank balances amount to $45,992.

59. By adding up the above together, I am satisfied that the Wife’s total capital assets amount to $5,040,748 ($1,854,756 + $1,320,000 + $1,820,000 + $45,992 = $5,040,748).        

Wife’s Liabilities

60. Apart from the mortgage loans that are outstanding in respect of the Wife’s 3 properties (which have already taken into account in calculating the net value of those properties above), the Wife has the following debts:

(1)	Hang Seng Bank Master card	$6,429
(2)	DBS Master card	$1,656
(3)	Bank of Asia	$3,240
(4)	Wing Hang Credits (Tax Loans)	$56,560
(5)	DBS overdraft for renovation	$259,108
(6)	Debt owed to her father-in-law (“KH”)	$800,000
	Total:	$1,126,993

Wife’s Net Assets

61. I am satisfied that the Wife has net assets in the value of $3,913,755 ($5,040,748 - $1.126,993 = $3,913,755).

Wife’s Expenses

62. In her latest affirmation (Bundle p.1029 to 1034), the Wife has set out her monthly expenses as follows:

General Expenses
Mortgage repayment for Baguio Flat	$19,012
Utilities	$2,300
Management Fee	$1,550
Food	$10,000
Household Expenses	$5,000
Domestic Helper (1/3 of total cost)	$2,600
Cable TV	$224
Swimming Pool	$240
Maintenance and fixing	$600
Renovation loan payment	$5,000
Sub-total:	$46,526
Personal Expenses
Meals out of home	$2,000
Transport	$1,500
Clothing/Shoes	$1,000
Personal Grooming	$500
Holidays	$3,500
Medical/Dental	$1,000
Tax	$13,600
School fee	$4,917
Charity and Church Donations	$300
Entertainment, gifts, books, mobile fee, etc.	$1,200
Mortgage Repayment for Sceneway Flat	$17,620
Mortgage Repayment for Discovery Bay Flat	$10,400
MPF	$1,000
Sub-total:	$58,537
Expenses on EH (son with new husband)
School fees	$5,972
Extra tuition fee	$435
School books and stationery	$100
Transport to school	$640
Medical/Dental	$400
Entertainment/presents/meals eat-out	$800
Holidays	$2,000
Clothing/Shoes	$500
Lunches and pocket money	$500
Other Transport	$400
Child-minding Fee (1/3 of total cost)	$2,600
Uniform	$30
Personal Hygiene	$100
Saving for Primary Education	$1,500
Sub-total:	$15,977
Expenses on A
School fees	$7,077
- school tuition: $78,600
- annual activity fee: $300
- school camp: $1,350
- swimming fee: $680
- diving course: $3,200
- year book: $300
- other misc fees: $500
Extra tuition fees	$1,700
- Chinese tutor: $1,200
- Kumon classes: $500
School books, books, stationery	$400
Transport to School	$200
Medical/Dental/Optical	$550
Entertainment/presents	$650
Meals eat-out	$900
Holidays	$2,800
Clothing/Shoes	$1,000
Lunches/pocket money	$1,000
Other Transport	$700
Child-minding Fee (1/3 of total cost)	$2,600
Uniform	$50
Personal Hygiene	$300
Dog Maintenance	$450
Piano maintenance	$160
Saving Plan	$2,800
Mobile line	$85
Other major one-off expenses	$352
- computer & accessories: $9,100
- furniture: $2,697
- mobile phone: $880
Sub-total:	$23,774

According to the Wife, her total monthly expenses amount to $144,814 ($46,526 + $58,537 + $15,977 + $23,774 = $144,814).

63. According to the Wife, the school fees for A will go up starting from the new school term in September 2006. She has to pay an extra monthly sum of $333 in this regard. This will make her total monthly expenses to $145,147 ($144,814 + $333 = $145,147). 

64. Therefore, the Wife is saying that she has a monthly deficit of $8,208 ($145,147 - $136,939 = $8,208).

Contributions from PH

65. Of course, the above calculation has not taken into account of the contribution from PH (the spouse in the new marriage) to the family. According to the Wife, PH’s monthly income ranges from $30,000 to $40,000 and the amount of his monthly contribution to the family is not regular. On average, the Wife said he would contribute “a few tens of thousands”.   

66. With PH’s contributions, it seems clear that the Wife is at least able to make ends meet.

Wife’ Expenses on A

67. At trial, counsel for the Husband has asked some questions on the Wife’s expenses on A but I can see that those expenses were not seriously challenged by the Husband. On balance, I accept those figures represent a fair assessment of the Wife’s expenses on A. 

Wife’s Investments

68.  In her final submission, counsel for the Husband criticized that some of the Wife’s expenses actually related to her own personal investment. The obvious examples are of course her monthly mortgage repayment in respect of the Discovery Bay Flat and Sceneway Garden Flat.

69.  I agree with counsel that these are the Wife’s personal investment items. Nevertheless, they are also real outgoings that the Wife is paying out each month. I will bear the nature of these outgoings in mind when I decide on the proper apportionment of A’s expenses.

70. In any event, I am told that the Wife will sell the Sceneway Garden Flat shortly after its vacation by the existing tenant. In other words, this piece of investment will not be kept by the Wife for long.

Total Expenses on A

71. From the above discussion, one can see that for the Husband, if one leaves out the maintenance that he is actually paying to the Wife for the moment (i.e. the sum of $17,738.33), he is spending a sum of $6,416 ($24,154.33 - $17,738.33 = $6,416) on A.

72. As I have said before, in order to be fair to both parties, one has to calculate part of the their general expenses as attributable to A as well.

73. For the Husband, his monthly general expenses amount to $19,271. I think it is fair to attribute half of those expenses to A, i.e. a monthly sum of $9,635.50 ($19,271 x ½ = $9,635.50). This takes the Husband’s expenses on A to $16,051.50 ($6,416 + $9,635.50 = $16,051.50).

74.  For the Wife, her expenses on A amount to $23,774.

75. For her general expenses, they amount to $46,526, I think it is fair to attribute 25% of that sum to A, i.e. a sum of $11,631.50 ($46,526 x ¼ = $11,631.50). This takes the Wife’s total expenses on A to $35,405.50 ($23,774 + $11,631.50 = $35,405.50).                   

76. By a simple calculation, one would see that the total monthly expenses on A by both parties amount to $51,457 ($16,051.50 + $35,405.50 = $51,457).

Apportionment of A’s Expenses

77.  I note that in comparison, the Wife is in a better position in respect of both her income and capital assets. Leaving aside the rental receipts (which are not enough to cover her mortgage payments) and the maintenance payment from the Husband, the Wife has a monthly disposable income of $99,701 ($89,001 + $8,900 + $1,800 = $99,701) which is 17% higher than the Husband’s monthly disposable income of $84,620 (not counting the education allowance which he just pays over to the Wife each month).

78.  As for net capital assets, the Wife has $3,913,755 which is 14% more than the Husband’s net capital assets at $3,429,538.

79.  The Wife is 6 years younger than the Husband. She has remarried and with new family support. But of course, I have to bear in mind of the special needs of her son and the relatively modest income of PH. I also have to bear in mind of her bigger financial burden and the effect of a reduction in the Husband’s periodical payments, if any, on her family finances. 

80. After considering all the circumstances of the case, I am of the view that it is fair for the parties to bear A’s total expenses in equal shares, i.e. each party to bear a sum of $25,728.50 ($51,457 x ½ = $25,728.50).

81. Since the Husband is already paying the expenses of A at the rate of $16,051.50 per month (see paragraph 73 above), I am of the view that the proper level of his maintenance payment should be set at $9,677 ($25,728.50 - $16,051.50 = $9,677). For convenience sake, I will round it up to $9,600.

Order

82. Based on the above reasons, I now order that the periodical payments for A’s financial support payable by the Husband be varied to $9,600 per month, payable on the 1^st day of every month. As provided in the Maintenance Order, the said periodical payments shall also be reviewed every 2 years to reflect the changes in the Hong Kong Consumer Index (Composite) published by the Hong Kong Government.

83. I understand that the Husband would like to have the variation date backed to the issuance of the summons. Since I have considered the parties’ latest circumstances up to the date of the trial in arriving at the above decision, I am of the view that it is appropriate for the variation to start from 1st October 2006.

Costs

84. I note that the Husband has succeeded in getting a variation of the Maintenance Order, but not as much as he has originally asked for. I am of the view that the Wife should pay 70% of the costs of the Husband in this application on a party and party basis, to be taxed if not agreed. This order is in the form of an order nisi which will be made absolute after the expiry of 14 days from the handing down of this judgment.