WKT v. SPF

FCMC 6900 of 2002

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 6900 OF 2002

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J U D G M E N T

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1. This is an application for ancillary relief.

Brief Background

2. The parties were married on 19^th January 1968.  There are three children of the family namely, a son born on 21^st November 1968, now 34 (“the elder son”), a daughter born on 6^th February 1975, now 29 and a son born on 11^th July 1977, now 27 (“the younger son”).  All three children are self supporting.  The elder two children are married and live separately from the Respondent (“W”).  W presently resides in the former matrimonial home with the younger son.

3. The Petitioner (“H”) claimed that on about 9^th October 2000 when he returned from Mainland China, he was not allowed by W to enter the former matrimonial home and since then the parties have been living separate and apart.

4. Subsequently on 24^th June 2002, H issued a divorce petition based on W’s unreasonable behaviour.  The petition was received by W on 27^th June 2002.  In the petition, H claimed for a transfer of property order in respect of the former matrimonial home, maintenance pending suit, periodical payments and lump sum payment.

5. Although W entered an acknowledgement of service indicating she intended to defend the suit, subsequently, no answer was filed and the divorce proceeded on an undefended basis.

6. A decree nisi was granted to H based on W’s unreasonable behaviour on 24^th February 2003. 

7. The question of ancillary relief was first heard on 1^st, 2^nd & 3^rd June 2004 and as there was not sufficient time, it was adjourned part heard to 1^st and 2^nd November.  During the first part of the hearing, as it transpired that W might have transferred various funds to the younger son from 28^th June 2002 to 27^th January 2003, H issued a notice of application on 2^nd September 2004 to set aside the dispositions by W.

8. H was a seaman from 8^th September 1964 until he retired in October 1998.  Due to the nature of his occupation, the parties spent more time apart than together during the marriage.  H was already a seaman at the time of the parties’ marriage and therefore W had full knowledge of H’s job nature. 

9. After H’s retirement in October 1998, he resided with W and the younger son in the former matrimonial home.  But the relationship between the parties was poor and eventually led to H not being allowed entry to the former matrimonial home on about 9^th October 2000.

Acquisition of the matrimonial home

10.  The former matrimonial home at ------------- (“the Property”) is registered in the sole name of W.  H alleged this was due to practical reason as he was frequently absent from Hong Kong and therefore matters relating to the Property would be more conveniently dealt with by W.  H claimed that it was a common intention between the parties that although the Property was registered under the sole name of W he has beneficial interest in it as the purchase price was solely paid by him. 

11. W claimed that she purchased the Property on 24^th November 1977 for a sum of $73,800 and the downpayment in the sum of $17,164 was paid by two instalments and for each instalment she said she borrowed money from her good friend.  She said she later repaid the money to her friend from her own savings.  The balance of the purchase price of $56,636 was obtained by way of a mortgage from Hung Kai Finance Co Ltd and the monthly mortgage instalment payment was about HK$848 each.  W claimed in her affirmation of means of 11^th April 2003 that she paid “each and every single instalment until the said mortgage was discharged and fully repaid in about 1986”. 

12. W denied that there was any common intention between H and her that he would have any interest in the Property.  She claimed that H had not contributed any sums in the purchase money of the Property and that the mortgage loan was paid off by her from her savings.  She said her income, from about 1977, was about $1,200 per month and it gradually increased to about $1,500 per month in 1986.  She claimed that in about 1987 after she had paid off the mortgage loan H requested her to transfer half of her interest in the Property to him so that he could sell it and use the money to go back to live in China for good.  She said she rejected this request.

Work History of W

13. W claimed that after she married H she found out that he was heavily in debt in the sum of about HK$10,000 which was a lot of money at the time.  She then looked for jobs and eventually found one when she was about four months pregnant with her first child.  She worked as a packaging worker and earned about $300 per month.  After giving birth to the elder son she worked for a textile factory for several months and earned about $1,000 per month.  She was then hospitalised due to lung problems.  She claimed she did not stop working except for the periods for giving birth to her children until about end of 2000 when she retired and ceased working totally.  Before she retired at about end of 2000 she said she was earning $2,000 per month. 

14. H admitted that at the time of marriage he did have some debts to pay but they were debts incurred for payment of his father's medical and funeral expenses.  He said the sums were in fact borrowed by his mother and as the son, he naturally shouldered the responsibility of repayment and such repayment was from his own savings and not from W’s earnings.

15. H denied that W was working throughout the years of the marriage.  He claimed that before the marriage W worked in a textile factory but because of lung disease she stopped work shortly shortly after marriage.  After giving birth to the elder son, her health condition deteriorated and at one point she was hospitalised for about six months due to tuberculosis.  Thereafter she would work part time at home.  H said she only started to work for a laundry after the parties’ daughter attended secondary school and her salary should be no more than $1,000 per month.  The elder son had attended Court to give evidence and according to him, W started to work in the laundry in 1996, when the younger son finished secondary school.  He said she earned about $1,000 per month.  The elder son’s evidence tends to support what H had said I also take into account that W had to look after the children almost single handedly and therefore she could not have worked full time when the children were young.

Work History of H

16. H said he was the main breadwinner of the family and he made arrangements for his employer to pay almost the whole of his monthly salary to W when H was at sea.

17. H produced a copy of his seaman’s Discharge Book issued on 2^nd November 1965 which contained a record of his employment history from 8^th September 1964 until 27^th October 1998 when he retired (“WKT–11”).  H extracted the dates of his employment at sea and produced a schedule (“WKT–12”) in his 2^nd Affirmation of Means.

18. From the Schedule and the Disclose Book, soon after marriage, namely 13^th May 1968 until his retirement in October 1998, H was employed approximately 280 months and 15 days out of a total of about 30 1/2 years (about 366 months), not taking into account what H had said that there was one voyage lasting about 12 months missing from the discharge book.  This means H was working at least 70% of the time during the marriage until October 1998.  His salary started with HK$800 in 1968 and ended with HK$16,250 before his retirement.  H said he was also able to make small sums on the ship when at sea which he would keep and use for his own spending.

Monetary Contributions by H

19. H said that throughout the marriage he had contributed about 90% or more of his income which was paid direct to W to maintain the family until about 1995 when he said that W had pocketed money which was meant for his mother.  H produced “Allotment Notes” as proof that the majority of this salary was paid direct to W by his employees.

20. Before 1989, H was asking W to pay $200 odd per month to his mother.  In about 1989, H said he had asked W to effect auto payment of about $1,000 per month to his mother who was living separately from the parties.  After H’s mother died, H returned to Hong Kong and only then he discovered that W had in about 1995 terminated the said auto payment without his knowledge.  He was disappointed at what W did and accused her of having pocketed the money which she should use to maintain his mother.  W denied this and said she paid H’s mother $217 each month initially by autopay into the latter’s account and later by depositing until about 1994 when W was told H’s mother’s account was closed.

21. Anyway, after H’s mother death in about 1996, H said although H continued to ask his employer to pay 90% of his monthly salary of $16,250 per month into W’s account, he said he told W to keep only HK$3,250 per month and to deposit the balance of the sum of $13,000 into his own account.  He told her that if the monthly amount of $3,250 was not sufficient for the household maintenance, she could then use the parties’ savings.

22. In June 1997 H said his then salary was $16,250 per month.  H said that W told him that the younger son was going to apply for admission to university and she needed money to finance the education.  H said he arranged for his employer to pay to W three months’ salary.  Subsequently he found out that the younger son’s application was unsuccessful but W had kept the entire amount.  W, however claimed H never wanted their children to study and would not spend money on their education, but she admitted she did receive about $50,000 from H.  She claimed, however, that she had given back about $126,000 to H in 1996 / 1997.

23. Between September 1997 to 8^th November 1997 and from March 1998 to 27^th October 1998 H said he worked on two ships respectively and over this period of time.  He said each month he had paid W $6,000 each month to maintain the family and he himself kept the balance of his salary of $10,250 each month.

24. After he returned home after retirement, he has not paid any household maintenance to W, apart from his contributions towards electricity, water and management fees until his alleged “eviction”.

25. In about January 2000, H purchased a Property in Ningbo (“the Ningbo Property”) for RMB50,000 which is now his residence.  He claims he has been told that the Government of Ningbo will resume the land on which the Ningbo Property is situated but he is not sure whether there will be any compensation by him.  H has been residing alone in the Ningbo Property since W’s eviction on 9^th October 2000.

Parties’ Savings

26. Whether the parties had any savings and if they had, the amount of these savings and their whereabouts are disputed issues between the parties.  According to H, by October 1994, the parties already had savings of about HK$447,279 and the bulk of these savings were kept in the sole name of W in her bank accounts.  To assist his memory he had made contemporaneous notes on 13^th July 1993 and on 18^th October 1994 and had exhibited copies of these notes typed by himself in his affirmations (“WKT – 3 ” and “WKT – 12”) (“the Notes”).  After November 1995, H claimed W had taken his key to her drawer and he no longer had access to her bank documents but H claimed he had continued to make notes to project the family savings and said the family earnings would have been at least over $400,000 by end of 1998.  W, however denied that the parties had any joint savings of about $400,000 at end of 1998.

27. Regarding the family expenses during the marriage, W admitted that when H went on board the ship, about 90% of his salary was remitted by his then employer into her bank account.  Although a large part of his income was paid to W, she claimed that H had used more money than he had given to her as he was mostly unemployed.  During the period when H was unemployed, out of the money he had given to W, she had to pay him cash to spend every day.  Therefore W said that what H had given to W was not sufficient to support his daily expenses during his periods of unemployment.

28. During the last 10 years before H's retirement W claimed that she had also given $10,000 to H each time he went seafaring for buying presents for his superior colleagues who agreed to take him on board.  From July 1996 until about 1997, W claimed that she deposited $10,000 to $13,000 per month into H's bank account number 455-047563-288 at Hong Kong Shanghai Bank when she received the remittance for H’s salary.

29. W claimed that during September 1997 to November 1997, H gave her only $3,200 per month and not $6,000 per month as alleged by him.  It was only from March 1998 onwards until October 1998 that he gave her $6,000 per month for about six months.  According to W, whose solicitor, Ms Wong, produced a schedule of calculations in her Closing Submissions, the total sum remaining with W out of H’s payments should only about $47,873.50.

30. On 7^th August 1999, H had own savings in his bank account of HK$320,812.24.  Out of this amount, he had spent approximately the following amounts as set out by his solicitor Mr Koo in his Closing Submission, not taking into account interest on the savings and H’s travelling expenses to and from Ningbo for these proceedings : -

		HK$
(a)	Purchase of the Ningbo Property on 13th January, 2000 Price RMB50,000.00 plus RMB1,000.00 tax	48,144.00
(b)	Decoration and furniture for the Ningbo Property (RMB 50,000.00)	47,170.00
(c)	Costs on account paid to his solicitor Messrs. T. H. Koo & Associates on 22nd May, 2002 and 18th February, 2003 for the intended divorce suit	24,000.00
(d)	H’s contribution to the Legal Aid Department paid on 21st March 2003	40,950.00
(e)	Medical expenses of about  RMB 10,000.00 on injuries H suffered in a traffic accident	9,400.00
(f)	Routine Medical Expense	5,000.00
		___________
		$174,664.00

Mr Koo further submitted that in addition to the above, H had spent about HK$125,000 on his living expenses.  In effect, H said whatever savings he held were almost all exhausted.

W’s Family Property in Pudong

31. H claimed that he had contributed money towards the re-building costs of a property in Pudong, Shanghai (“the Pudong Property”) in October 1994 for W’s brothers.  He believes W has interest in the Pudong property.  W on the other hand claims that she has only the right to occupy one of the houses built on the Pudong Property.

32. W denied that she or her brother had requested H for money to build her maiden family's house and she alleged that as H had refused to contribute any sums towards buying the Property in 1977 it was unlikely that he would agree to contribute any sums anyway in 1994 for W’s maiden family to build a house.  When W's brother told her that he wanted to rebuild her family's property in 1994, W said she drew money from her bank account and remitted about HK$172,202 to her brother.  H, however, said this sum came from the parties’ savings.

33. Whether W has beneficial interest or only a right to occupy one of the houses on the Pudong Property this Property and the value of this right is again another bone of contention. 

W’s Brother’s Monies

34. Among W’s bank accounts, there were previously two accounts, one joint fixed deposit with her elder brother (“SL”) at the DBS Kwong On Bank 501-47260-3 which was terminated on 25^th June 2002 before maturity and the other, a savings account in her sole name at Bank of China No 012-8-31100-45963 which was closed on 28^th June 2002.  In the DBS fixed deposit there was an amount of HK$1 million which W said was not her money and which she said she had transferred to her SL upon terminating the deposit.  W said the monies in her said Bank of China savings account were also trust money belonging to SL and a total of HK$230,000 was transferred out to W’s younger brother’s (“STS”) account in Shanghai on 6^th March 2002 pursuant to SL’s instructions.  W said both these sums were SL’s monies arising out of the sale of a property belonging to SL. 

The Parties’ claims

35. In his Closing Submission, H’s solicitor, Mr Koo, submitted that this Court should award to H 60% of the total family assets.  According to H, the total assets are about $1,809,580.75 and after deducting assets held by H of $82,468, H should receive a net sum of about $1,003,280.45.

36. W claims she should retain the Property and H’s claims for ancillary relief should be dismissed.

Issues

37. The main issues between the parties were as follows :

(i)	whether the parties had joint savings of at least $400,000 in 1998;
(ii)	whether the money for the construction of the Pudong Property came from W’s savings or the parties’ joint savings;
(iii)	whether the HK$1 million originally kept in the joint fixed deposit account of W and SL at the DBS Kwong On Bank and transferred by her to SL was joint savings of the parties or whether it was money belonging solely to SL;
(iv)	whether the HK$230,000 transferred out of W’s sole name account with Bank of China savings account on 6th March 2002 to STS was SL’s money or part of savings of the family;
(v)	whether the purchase of the Property was contributed solely or mainly by the earnings of H or by W;
(vi)	whether the amounts transferred by W to the younger son should be set aside and whether these were monies belonging to the younger son or monies belonging to the parties.

(i)  Whether the parties had joint savings of at least $400,000 in 1998

38. It would appear that shortly after the issue of the petition, W closed some of her accounts and transferred most of the monies then held by her to her two brothers and the younger son.  I will deal with these sums later in this judgment.

39. Out of the 11 bank accounts held by W which were listed on page 5 of Ms Wong’s Closing Submission, 4 were only fully disclosed by W after this Court gave further direction during the first part of the hearing in June 2004.  These 4 accounts were however set out in H’s record of savings prepared by him, which is part of the Notes as described above.

40. As stated hereinabove, H said after November 1995, W took back from H the key to her drawer and he no longer was able to have access to her bank documents but he continued to keep notes of how much he paid to project the family savings.  He summarised his projections in a table which he produced as exhibit “WKT – 13” in his 3^rd affirmation.  According to this table, on 15^th November 1995, the family savings according to H should be $439,867.38 and at end of 1998 there should still be about $434,000.

41. I accept the records kept by H up to 15^th November 1995 were contemporaneous records.  I find W’s evidence in this regard rather vague and I therefore accept H’s evidence that there were indeed family savings of at least $400,000 at end of 1998.

(ii)  Whether the money for the construction of the Pudong Property came from W’s savings or the parties’ joint savings

42. Looking at H’s work history and his allotment notes, it is clear that his income was considerably more than that of W’s during the marriage.  It is further clear that about 90% of his salary was paid direct to W by his employer when he was at sea.  It also appears that H has kept very detailed records as to the payments to W and also of the parties’ savings.  W seems to be under the impression that any money earned by her was her money.  Both parties are now getting on in their age and their evidence was rather confusing at times.  However, after having observed the demeanor of H and W, I find W rather evasive while giving evidence.  In fact in such a long marriage when the parties started off with nothing, whether it was money saved by W or whether it was money earned by W or whether it was money from H, it does not really matter since all these sums should form part of the joint assets of the parties.  W has admitted that she remitted HK$172,000, namely HK$50,000 on 3^rd September 1994, HK$55,200 on about 19^th April 1995, and HK$67,000 on 9^th June 1994 to her younger brother towards the construction of the Pudong property.  Copies of the remittance advices through Bank of China were exhibited by her.  She claimed that the money was drawn from her bank account, and therefore “her” money.  I do not accept this as “her” money.  “Her” money was mainly savings held by her and I am of the view that these monies should also be regarded as part of the parties’ joint assets.

43. W admits she has the right to reside in one of the three buildings built on the Pudong Property and it appears each building has 3 levels.  At this Court’s direction, H’s solicitor, Mr Koo, has tried to obtain a valuation of the Pudong Property during the intervening adjournment but unfortunately, this has not been successful, as W’s younger brother claimed there was no title certificate apart from a land user’s certificate.  According to this certificate, the registered users are W’s elder brother and her younger brother.  As W herself has admitted that she has the right to reside in one of the buildings, and she has paid HK$172,000, I am of the view that W has an interest in the Pudong Property.

44. H’s solicitor, Mr Koo has asked me to draw an adverse influence against W that W’s interest in the Pudong Property should now be twice what she paid for.  However, without proper evidence, I cannot do so.  As there is no proper valuation of the Pudong Property before the Court, I could only assume that W’s interest therein should not be less than the amount paid by her, namely HK$172,000.  I find that the amount of HK$172,000 came from the parties’ joint assets and therefore W’s interest therein should continue to be part of the parties’ joint assets.

(iii)  Whether the HK$1 million held in a time deposit account held at DBS Kwong On Bank in the joint names of W and SL and later transferred to SL was the joint savings of the parties or whether it was money belonging solely to SL and held in trust for him by W

45. As stated above, W and SL had held a joint fixed deposit of the principal sum of HK$1 million at the DBS Kwong On Bank.  SL signed a witness statement on 16^th November 2003 to state that before his retirement, he had a good business (which I assume was the noodle shop the elder son referred to) and had purchased a shop space in Kowloon on about 11^th May 1983 (“the shop space”).  In August 2001, SL said he suffered a stroke and experienced difficulty in walking and his health deteriorated.  Prior to this, he had a divorce with his wife, as a result of which he had to sell the shop space for HK$2.38 million, and after deducting legal costs and other expenses, the net proceeds were HK$1.4 million.  He stated that he deposited the amount originally in a fixed deposit in his sole name with the DBS Kwong On Bank, and thereafter, he withdrew various sums totalling HK$400,000 and transferred these sums into his current account with the said Bank, leaving HK$1 million in his fixed deposit account.  Due to his difficulty in walking and health problems, he said he then decided to transfer the HK$1 million to a fixed deposit in joint names with W, and this joint fixed deposit commenced on 24^th December 2001.  Regarding the sum of HK$400,000 in his current account, he said he instructed W to open an account with Bank of China, no 012-831-1-0045963 (“the said BOC account) and he asked W to transfer various sums amounting to a total of HK$250,000 out of the $400,000 from his account with DBS Kwong On Bank into the said BOC Account.

46. In March 2002, SL decided to return to live in Shanghai, and he said he then instructed W to transfer HK$230,000 (the total amount was HK$230,150, inclusive of HK$150 for remittance charges) from the said BOC account to the account of their younger brother STL with Bank of China in Shanghai.

47. SL further claimed that the sum of HK$9,800 withdrawn on 6^th March 2002, and HK$5,000 withdrawn on 16^th May 2002, and HK$7,595.64 withdrawn on 28^th June 2002 by W from the said BOC account were all withdrawn by W at his for his use and benefit.

48. SL stated that he returned to Hong Kong in July 2002, and he instructed W to cancel the joint fixed deposit account at DBS Kwong On Bank and transferred the sum of HK$1 million therein to his current account at DBS Kwong On Bank, and subsequently he remitted the sum to his account at ICBC in Zhang Mu Tou.  He claimed that all the sums in the joint fixed deposit account and in the said BOC account was held in trust for him by W.

49. Due to health reasons, W said SL was not able to come to HK to attend the trial for cross examination.

50. SL in his witness statement also produced a land search to show that he sold the shop space for HK$ 2.38 million on 23^rd October 2001.  He also produced copy of a letter he wrote to his solicitor handling the conveyancing on 13^th February 2003, instructing his solicitor to pay the balance of the sale proceeds to W.

51. There is no evidence to show that W had any interest in the shop space.  W later produced copies of two cheques, one dated 18 October 2001 for the sum of HK $1,245,612.69 from W’s elder brother’s solicitor to him, and one dated 19 October 2001 for the sum of HK$155,420 from his solicitor to him, and a completion statement  indicating the total amount of HK$1,401,032.69 being paid to the elder brother in October 2001.

52. Although initially H claimed this sum of $1 million consisted of the family’s joint savings, upon seeing the above evidence, according to Mr Koo’s Closing Submission, H is now prepared to accept the sum of $1 million was not W’s.  In any event, I find that the monies held in the joint account of W and at the DBS Kwong On Bank do not belong to W.

(iv)  Whether the HK$230,000 transferred out of the said BOC account on 6^th March 2002 to STS’s account in Shanghai was money belonging to SL or part of the savings of the family

53. According to the evidence of W and the witness statement of SL, this sum of HK$230,000 was also part of the net sale proceeds of the shop space, and W transferred the money to STS according to instruction from SL.

54. Contrary to the sum of HK$1 million which was remitted directly to SL’s account at Zhang Mu Tou, the said sum of HK$230,000.00 was remitted to STS’s account in Shanghai.  W explained that as at that time SL needed to use the money in Shanghai and he therefore instructed W to transfer the money to STS’s account in Shanghai.

55. W said that the HK$250,000.00 kept in the said BOC account from which the said sum of HK$230,000.00 was remitted came from SL’s DBS current account 077-002-1573-0 and this was part of the net sale proceeds of the shop space.  W said she was only carrying out SL’s instruction to make 26 separate withdrawals and 15 separate deposits to move the sum of HK$250,000.00 from his DBS account to the said BOC account before remitting HK$230,000.00 to Shanghai.  It took her one whole month to complete the movements.

56. Mr Koo said there was no reasonable explanation as to why W and SL adopted such a time consuming way to transfer the money.  SL could have issued a cheque to W or SL could instruct his bank to transfer the entire sum.  It was pointed out by Mr Koo that although there appeared to be daily withdrawals from SL’s DBS account and daily deposits in the said BOC account of the like amount, a detailed analysis of the two accounts as shown in the table prepared by Mr Koo (“P-4”) shows that the amounts actually do not quite match another.  For example, he submitted that the total amount of deposits in the said BOC account from 27^th to 31^st December 2001 amounting to HK$70,000.00 actually exceeds the total amount of withdrawals from SL’s DBS account for the same period (amounting to HK$60,000.00).  The total amount of HK$250,000, however, do match up.  W explained that the DBS bank only allowed daily cash withdrawal of not more than $10,000 and that was why it took her about one month to complete the withdrawal.

57. The sum of HK$230,000 was transferred in March 2002 which was three months before H issued the petition and 3 months before the other transfers in paragraph 59 hereinbelow.  There was no evidence that W knew at that time that H would make a claim for ancillary relief against her.  In the circumstances, although the method of transfer was cumbersome, I accept W’s evidence that the said HK$230,000 was part of the net sale proceeds of the shop space and was money belonging to SL and therefore this sum should not form part of the parties’ joint assets.

(v)  Whether the purchase of the Property was contributed solely or mainly by the earnings of H or of W

58. The Property was acquired in W’s sole name on 24^th November 1977.  However, this was a long marriage and H had contributed almost 90% of this salary to W.  W had arranged for the purchase and loans in relation of the purchase of the Property and W says she was the one who paid for the mortgage of the Property.  No doubt this would be correct as H was frequently at sea.  But the issue is the source of the funds for the repayment of the loans and for the mortgage.  W, admitted during her oral evidence, and it also appeared from Ms Wong’s Closing Submission that the 20% deposit amounting to $14,760 came from the monies H paid W.  Also H produced a receipt for the payment of the aluminium windows of $16,000.  Having heard the evidence of the parties, I tend to accept H’s version of events and I find that the repayment of the loans to W’s friends and the repayment of the mortgage came out of the monies H paid W or even if it came out of W’s earnings, this would still be the parties’ joint money and that it was the parties’ common intention that the Property should be owned jointly.  In any event, upon a divorce, this Court has the discretion to make an appropriate order adjusting the parties’ rights in their assets.

(vi)  Whether the amount transferred by W to the younger son should be set aside and whether these were monies belong to the younger son or monies belonged to the parties

59. W received the divorce petition on about 27^th of June 2002 and in bank statements produced by W pursuant to my directions during the former part of the trial, it transpired the following sums were transferred out by W : -

(a)  HK$284,989.20 on 28^th June 2002;

(b)  AUD19,186.49 on 17^th July 2002;

(c)  NZD11,236.44 on 17^th July 2002; and

(d)  AUD14,023.57 on 27^th January 2003.

60. It appears from W’s Bank of China Multi Currency Time Deposit Account history that a fixed deposit of $284,989.20, a fixed deposit of AUD33,026.49 and NZD11,236.44 were uplifted prematurely, namely, the HK$284,989.20 on 28^th June 2002 and the other two amounts on 29^th June 2002.  The AUD and NZD amounts were redeposited on 13^th July 2002 but again prematurely uplifted on 17^th July 2002.  On the same day a sum of AUD13,800 was redeposited and rolled over until 27^th January 2003 when the account was closed and the total sum of AUD14,023.57 withdrawn.

61. W claimed that a sum of $288,000 was transferred to the younger son and the rest was kept in cash at home and eventually all spent by her.  During this period she was receiving $8,000 per month from the younger son of which she said she would use only about $4,000 per month and would save up the balance for the son.  If this were the case, she could not have spent all this cash.  W’s evidence on how she spent the rest of the sums was full of inconsistencies, at first saying she spent some money on elder son’s wedding but the elder son married in 1998, and later saying she spent the monies, inter alia, on her two cats, gifts to friends, medical expenses and holidays.  She said she went to Japan twice, once in 2001 and once in 2002 and her son had paid for these trips first and she then paid him back.  She also said after uplifting in June 2002, the monies were initially placed in her daughter-in-law’s account, details of which was never disclosed.  The details of the younger son’s account into which the sum of $288,000 was allegedly credited were also not disclosed.

62. The younger son was subsequently called by W to give evidence.  The younger son admitted an amount of HK$288,000 was transferred to him.  He said he started to work from about middle of September 1997 onwards he worked as a chef for a sushi restaurant for over three months but he was not making much and therefore he did not pay any money to his mother.  At about the end of 1997, he changed to work for his present company which is an airline company.  There was a salary increase and he said he started paying HK$4,000 per month to his mother for family expenses and $4,000 per month to his mother for her to save up for him.  Sometimes, when he ran out of money, he would ask his mother for some money but only several hundred dollars at a time.  In December each year, he would receive a bonus and he paid $5,000 extra out of his bonus to his mother during the first two years and there after he paid her $7,000 out of his annual bonus.  He claimed he had kept a record of these payments, but he did not bring it to the Court.  When he was asked to explain how  he arrived at the sum of $288,000, he said he paid his mother $53,000 in 1997 / 1998, another $53,000 for 1998 / 1999, $59,000 for 1999 / 2000, $62,000 in 2000 / 2001, and $61,000 in 2001/ 2002.

63. I note, however, the younger son appeared to be doing the above calculations in the witness box.  Furthermore, the calculations do not seem to be consistent with what he said in the witness box.  The younger son said he only started working for the airline company at the end of 1997.  I do not think he would receive a bonus for 1997 nor could he have paid $53,000 in 1997.  Also, he said he was repaid by W in June 2002.  Therefore, the amounts would not add up to $288,000.  What he said was also different from W’s own evidence, who at first said out of the $8,000 given to her by the younger son, she would save about $5,000 to $6,000 per month.  She later said she would give $2,000 back to the younger son and she would use only $2,000 out of the $8,000.  She then said she would save about $4,000 per month for the younger son.  Her evidence, like most of her evidence, was rather vague and confusing.  Anyway, the younger son said the amount was still in his bank account but has not provided any evidence of the same.  W said the amount was transferred to him in cash and again had failed to provide any documentary evidence.

64. After hearing evidence from the younger son, I am of the impression that he is very loyal to his mother.  I believe he would pay W monthly sums.  W could have saved up some money for him but there is no documentary evidence to show that the above deposits consisted of these savings.  If W and the younger son’s evidence were to be believed there should be monthly deposit of $4,000 per month accumulating to $4,000 per month to form the final amount.  No such evidence was provided.  I therefore cannot accept W’s explanation and found that all the sums transferred from her accounts listed in paragraph 59 above were assets held by W and believe they consisted of parties’ joint savings which I find the parties had at end of 1998.  I am satisfied that W had transferred the sum of $288,000 to the younger son with the intention of defeating H’s claims for financial provisions.  However, I found that the sum of $288,000 transferred to the younger son was part of the above sums as W said she sold part of the Australian Dollars.  W said at that time the AUD to HKD exchange rate was about 4 to 1.  The NZD exchange rate should be lower.  As there was no proper evidence before me as to how much she sold and at what exchange rate, I could only say W held at least HK$450,000 between June 2002 to January 2003.  I would accept, however, W may have spent some money on the holidays or other expenses not specifically listed by her in her list of monthly expenses since January 2003 but these amounts should not be more than $50,000.  Apart from $288,000 now held by the younger son, I therefore hold that W should still have about $112,000 in savings.  In view of my above findings, I will set aside the disposition of HK$288,000 to the younger son, which sum should be transferred back to W.

S 7 Factors

65. I now come to consider the section 7 factors under the Matrimonial Proceedings and Property Ordinance (“MPPO”).

(i)  The income earning capacity property and other financial resources which each party has or is likely to have in the foreseeable future

66. Both parties are now retired and due to their age, I accept that they would have little earning capacity.  The younger son has been paying W at least $4,000 per month for household expenses since about end of 1997.  The elder son was paying W regular sums of several hundreds before he moved out.  Now the elder son and the parties’ daughter give W’s sums of money only during festivals.  Although the younger son said he and his siblings would be prepared to give some money to H as well but so far, there is no evidence that they have done so.  In any event, although the children are paying sums to W, they are under no legal obligation to do so and also the younger son may set up his own family one day.  The assets of the parties consist of : -

Assets presently held in H’s name

(i)	Cash at bank ($10,229.05 at BOC Account on 28/5/2004 and $19,125.16 at the HSBC Superease Account on 28/5/2004) totalling $29,354.21 of which Mr Koo submits only about $13,600 remaining, after taking into account his monthly expenses since June 2004.
(ii)	Ningbo Property RMB73,000 which is approximately HK$68,868.
The total assets held by H, as submitted by Mr Koo, are approximately HK$82,468, which I accept.

Assets presently held in W’s name

(i)	The Property		HK$600,000
(ii)	Interest in the Pudong Property,		HK$172,000
	which I find she has
(iii)	Cash at bank, including
	(a)	Amount set aside	HK$288,000
	(b)	Amount I held W	at least
		should still have in	HK$112,000
		her savings	($400,000 less
			$288,000)
The assets held by W should be at least $1,172,000.

(ii)  Financial needs, obligations and responsibilities which each party has or is likely to have in the foreseeable futuree

67. H says his present outgoings are approximately HK$2,620 per month.  Although he is living in Ningbo, he hopes to return to live in Hong Kong, since he holds a HKID card and as a non resident in PRC, his medical expenses are high.  H’s cash savings have more or less been used up and he would require living expenses.  H’s estimated legal costs were $293,000 as at 1^stt November 2004.

68. W says her present outgoings are approximately $3,968 per month.  She said the Property now needs renovation which might require $30,000 to $40,000.  W’s estimated legal costs were $355,000 as at 29^th October 2004.

(iii)  Standard of living enjoyed by the family before the break down the marriage

69. I find that the parties led a fairly frugal lifestyle during the marriage.

(iv)  Age of the parties and duration of the marriage

70. H is now about 67 and W is now about 63.  The marriage lasted about 34 years by the time the divorce petition was issued on the 24^th June 2002.

(v)  Any physical or mental disability of either of the parties

71. There is no evidence that W is suffering from any physical disability for her age except she said she was suffering from high blood pressure and depression at the commencement of the trial.  She is also receiving medical treatment for her injured hand and fingers.

72. There is no evidence that H is suffering from any physical or mental disability for his age except he said that he was knocked down by a car in China in about August 2003.

(vi)  Contribution made by each party to the welfare of the family including any contribution made by looking after the home

73. In such a long marriage, I find both H and W have contributed towards the family.  H has worked almost 70% of the time until 1998 and the bulk of his salary was given to W until about 1996.  W’s contribution was apart from a homemaker and the child carer, she had also worked to help with the family finance.  I accept that W had to raise the children and to look after the household almost single handedly due to the fact that H was most of the time away at sea.  Furthermore she had worked hard to contribute to the family expenses.  However, I find H had also had to work hard, and in my view it was not a easy life to be at sea for such a long time.  It was a pity that eventually when he could return home to enjoy family life, the relationship between the parties deteriorated to such an extent that there had to be a divorce.  In this long marriage of 34 years, I would regard the parties having made more or less equal contributions and I do not consider W’s contribution to be exceptional or far greater than H, as submitted by Ms Wong.

(vii)  The value to either party of the marriage of any benefit which by reason of the dissolution of the marriage the party may lose the chance of acquiring

74. There is no evidence of any such loss.

(viii)  Conduct of the parties

75. The elder son has filed an affirmation and has attended Court to give evidence to say that whenever H was at home, he would beat the children for no reason and that he could lose his temper over trivial matters, and that H liked to eat nice and expensive seafood, and he often drank and smoked at home.  W had also made such allegations during her oral evidence.  H alleged that W had evicted him.  I find that due to H’s habits and temper, he was probably not an easy person to live with and this has not only affected his relationship with W but also with his children, who appear to be all much closer and attached to W, who has been their main carer, than to H.

76. However, I do not find any of these allegations in relation to conduct to be in the “gross and obvious” category.

77. It has been alleged that W did not make a full and frank disclosure of assets held by her and her conduct was described by Mr Koo as “despiteful”.  This would be financial conduct which is a matter for consideration in connection with costs.

Conclusion

78. As set out above, I find that the assets held by W should be in the region of $1,172,000 including the Property and the Pudong Property.  The assets held by H are about HK$82,468, including the Ningbo Property.  The total assets are therefore about $1,254,468.

79. Ms Wong has referred this Court to the case of White v. White 2003 3 WLR 157 where it was suggested equal division be a starting point for distribution of family assets in divorce cases.  She has asked this Court to depart from equal division on the basis that W’s contribution to the family, both physically and financially, was far greater than P.  As set out above, I find that the parties’ contribution towards the family was more or less equal during this long marriage, however, in this case, I do believe that there should be a slight departure from equality in view of all the circumstances of the case.  In any event, White v. White was held to be not binding on this Court (see F v. F Vol. 1 2003 Hong Kong Law Reports & Digest 836).  This Court is bound by C v. C [1990] 2 HKLR 183 in which it was held that the first task of the Court was to consider “all the circumstances” and all the factors in s. 7 (1) of MPPO and then to evaluate the parties’ “reasonable requirements”. 

80. Neither party has provided the Court with Duxbury calculations in relation to parties’ reasonable requirements.  Having considered all the circumstances of this case, including the parties’ respective reasonable requirements and their ages and based on a generally accepted real rate of return of 3.75% (see “At A Glance” 2004 – 2005), I am of the view that W should pay to H a lump sum of $500,000, which, plus his present cash savings, should give him about $513,600 in addition to the Ningbo Property.  I am of the view that this sum should be sufficient to cover his reasonable requirements.  W would have $672,000 in assets which should also be sufficient for her reasonable requirements.

Order

81. I will make an order to the following effect : -

(1)   The transfer of $288,000 by W to the younger son shall be set aside and the sum to be transferred back to W.

(2)   W shall pay to H a lump sum of $500,000 within two months.

(3)   H shall retain the assets presently held in his name.

(4)   W shall retain the assets presently held in her name.

Costs

82. I will reserve the question of costs.