DM v. DK

FCMC 10633/2022

[2026] HKFC 45

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 10633 OF 2022

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J U D G M E N T
( Ancillary Relief )

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This Application

1.  This is the Petitioner wife’s (“W”) application for ancillary relief against the Respondent husband (“H”).

2.  The trial took place over two days on 25^th and 26^th March 2025.

Parties background and Litigation History

3.  At the time of this hearing, W was aged 48 and H was 58. H is a business man selling jewellery packaging boxes and W is a lighting design consultant.

4.  The parties met in 2006, got married in Israel in August 2008 and settled in HK in 2009.

5.  The parties have a daughter (“E”), who was born on XX July 2010, and aged 14 at the time of the hearing. E has developmental problems, including dyslexia, ADHD, adjustment disorders and intellectual disability. She needs constant and on-gong therapy, learning support and medication.

6.  W commenced her Petition based on ground of one year consent, or in the alternative, unreasonable behaviour, on 3 November 2022. H filed his Form 4 on 11 November 2022, then left and returned to the US in around December 2022. This was a 14-year relationship.

7.  Decree Nisi was granted on 20 January 2023.

8.  The parties consented to arrangement for E by their Consent Summons dated 22 August 2023, requisition was made by a Master which was never responded to.

9.  The first round of Form Es from both parties were exchanged in January 2023, answers to questionnaires were filed from both parties in April 2023.

10.  Thereafter, W initiated a Specific Discovery Summons on 3 May 2023; and H initiated a “Production of Documents” Summons on 7 June 2023. At a hearing on 7 November 2023, at which W was represented by counsel, and H was absent. W decided to withdraw her Summons, and H’s Summons was dismissed.

11.  Also at this hearing on 7 November 2023 and in H’s absence, Order was made granting joint custody, care and control to W and defined access to H.

12.  H’s solicitors filed their application to cease to act on 12 September 2023, for which an Order was made on 17 October 2023. Thereafter, H had entered no appearance with regard to the financial aspect of these proceedings; looking at the timeline, this was done after arrangement regarding E was signed. He did not resurface until 3 February 2025, a mere 7 weeks before this current trial.

13.  In the meantime, H actively engaged with W where E is concerned with regard to his access to her, always to do with holiday removal, 12 Orders were made for this on: 8 June 2023, 3 July 2023, 23 November 2023, 8 April 2024, 26 June 2024, 25 September 2024, 18 December 2024, 25 March 2025, 24 June 2025, 10 October 2025, 12 December 2025 and 30 January 2026.

14.  It is quite apparent that H is selective in his engagement in these proceedings, more particularly:

a.  H has failed to appear at the hearing on 7 November 2023, although he chose to sign a consent summons for travel arrangement for E on 20 November 2023. At this hearing, parties were given orders to lodge lists of properties / assets that require valuation and to adduce expert evidence with SJE; deadlines were given for interlocutory applications to be made including joinder application (on or before 28 March 2024).

b.  Having just signed a consent summons for travel arrangement for E on 2 April 2024, H failed to appear at a hearing on 16 April 2024, when the case was scheduled for a CMH, and parties were ordered to agree schedules for chronology, issues in dispute, and assets and liabilities.

c.  Having just signed a consent summons for travel arrangement for E on 7 June 2024, H failed to appear at the CMH on 18 June 2024. At this hearing, parties’ narrative affidavits and updated schedules were ordered. H has failed to comply.

d.  Between the date of CMH and PTR on 10 January 2025, H further signed 3 consent summonses for travel arrangement for E on 24 June 2024, 17 September 2024 and 17 December 2024. Yet he chose to be absent at the PTR.

15.  At the PTR, I made Unless Orders for H to produce his narrative affidavit and Form E on or before 3 February 2025; and directed timeline for updated schedules.

16.  On 3 February 2025, H’s current solicitors filed Notice to Act, and he filed his narrative affidavit and Form E on the same day.

17.  This late entry into the litigation created a flurry of discovery processes.

18.  On 24 February 2025, in responses to a number of issues raised in H’s narrative affidavit, W filed her Summons for valuation of a property in NY (the “NY Property”).

19.  On 27 February 2025, H filed his Summons for valuation of two companies (“S Ltd” and “G Ltd”) in which W has interests.

20.  I heard these two Summons on 28 February 2025. SJE for the valuation of the NY Property was appointed, W was ordered to produce Audited Financial Statement (“AFS”) for 2024 of G Ltd.

21.  Valuation reports for the valuables and a New York Property were submitted on 10 March and 18 March 2025 respectively.

22.  At the two-day trial, H attended via VCF, both parties were legally represented and gave oral evidence.

H’s alleged Medical Condition

23.  On 30 December 2024, this Court received an email from H, with the following specific comments:

a.  He said he could not afford to retain a lawyer.

Yet he did for this current trial engaged lawyer and incurred not less than $500,000 according to his Form H.

b.  He said due to constrained income, he could only afford to have E visits him in the US.

There were correspondences produced by W’s solicitors which shows that he was in Milan with E in August 2024.

c.  He said he have not been able to travel to HK with recent medical / cardiac issues as he is “limited to how far I can travel or exert myself”.

The above observation is repeated.

24.  On the day of the PTR on 10 January 2025, H was ordered to provide certified proof of his alleged medical / cardiac issues which prevented him from flying to HK. This he did on 20 January 2025, attaching a letter from a Doctor RN of N Medical PC dated 14 January 2025 saying that H is under his care and has a medical history of “coronary artery diseases, diabetes Mellitus, hyperlipidaemia, and attention deficit disorder”, and says that H is “not able to take long flights exceeding more than 6 hours”. My observation is that maybe H had probably not informed his doctor that he was recently in Italy.

25.  W’s solicitors also took issue with H’s allegation of his medical condition, in their letter of 28 January 2025, they reminded me that H’s hyperlipidaemia and ADHD were already disclosed in his first Form E in 2023, and he had since then travelled between NY and HK; furthermore, they also produced the above mentioned evidence that H was in Milan with E in August 2024.

26.  By my memo of 28 January 2025, I had reluctantly granted leave for H to attend trial via VCF, but stating my dissatisfaction with his medical information and asked for further details which prevented him from flying to HK. This was eventually submitted by his solicitors on 3 March, again attaching a letter by the same Doctor RN, which only stated his stents placement operation in September 2023, diabetes diagnosis since December 2024, and hyperlipidaemia and ADHD for over 10 years. The Doctor now says due to that surgical procedure, H is “advised to avoid taking long flight exceeding more than 6 hours”.

27.  H must have had a miraculous turn in his health condition as on 24 June 2025 (3 months after this trial), leave was sought for him to travel with E to Italy between 22 June to 3 August 2025.

28.  It should not be disputed that travel from New York to Italy exceeds 6 hours. So, either H chose to take risk with his health because he wanted access with E other than in the US; or he used his alleged medical condition as an excuse not to attend this trial in person. On a balance of probabilities and considering the circumstances over the cause of these proceedings, I am inclined to believe the latter; and will consider the above conduct and representations in my overall assessment of the H’s case.

Parties Evidence

29.  The parties’ evidence before the Court are as follows:

Date	Petitioner W	Respondent
13.1.2023	Form E
18.1.2023		Form E
31.3.2023	Answer to Questionnaire
6.4.2023		Answer to Questionnaire
3.5.2023	Affirmation (in support of Specific Discovery Summons)
24.5.2023		Additional Answer (to W’s solicitors’ letter of 21 April 2023 and W’s SD Summons 3 May 2023)
7.6.2023		Affidavit (in support of “Production of Documents” Summons)
16.10.2024	Narrative Affirmation
3.2.2025		Narrative Affidavit
3.2.2025		Form E

The Applicable Law & Legal Principles

Legal Principles with regard to determination of ancillary relief claims

30.  Section 7 of the Matrimonial Proceedings and Property Ordinance (“MPPO”), Cap 192 sets out the matters that the court must have regard to when making orders for ancillary relief:

“(1) It shall be the duty of the court in deciding whether to exercise its powers under section 4, 6 or 6A in relation to a party to the marriage and, if so, in what manner, to have regard to the conduct of the parties and all the circumstances of the case including the following matters, that is to say-

(a) the income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future;

(b) the financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future;

(c) the standard of living enjoyed by the family before the breakdown of the marriage;

(d) the age of each party to the marriage and the duration of the marriage;

(e) any physical or mental disability of either of the parties to the marriage;

(f) the contributions made by each of the parties to the welfare of the family, including any contribution made by looking after the home or caring for the family;

(g) in the case of proceedings for divorce or nullity of marriage, the value to either of the parties to the marriage of any benefit (for example, a pension) which, by reason of the dissolution or annulment of the marriage, that party will lose the chance of acquiring.

31.  The Court of Final Appeal in its landmark judgment of LKW v DD [2010] 13 HKCFAR 537 has laid down a 5-step approach in assessing the division of the parties’ matrimonial assets:

1.  The ascertainment of the financial resources of each of the parties calculated as at the date of the hearing (§§71 to 73);

2.  The assessment of the parties’ financial needs. If the total resources are not enough to meet the parties’ needs, the s.7 exercise should stop at this step and there is no room to apply any sharing principle (§§74 to 79);

3.  If surplus assets would remain after the parties’ needs have been catered for, the next step should normally be for the court to apply the sharing principle to the parties’ total assets, with a yardstick of equal division as part of that principle. This means that the total assets should be divided equally between the parties unless there is good reason for departing from an equal division (§§80 to 82);

4.  In considering whether good reasons exist for departing from equal division, the answer is to be found in the terms of s.7 and the implicit objective of a fair distribution of the assets. Factors like source of the assets, conduct, financial needs, duration of the marriage, contribution to the family and compensation are all material considerations (§§ 83 to 130); and

5.  The weight to be given to each of the factors is a matter of discretion for the court (§131).

32.  Which are to be considered against 4 guiding principles, namely:

(i)  objective of fairness,

(ii)  rejection of sex or role discrimination,

(iii)  yardstick of equal division, and

(iv)   rejection of minute retrospective investigation.

33.  The principles are trite and will be applied to the issues in this case hereinbelow.

Legal principles with regard to failure to disclose financial information

34.  On this, I turn to the case of Moher v Moher [2019] EWCA Civ 1482; [2020] 2 WLR 89; [2020] 1 FLR. 225; [2019] 3 FCR. 244, which was quoted in the case of CCYL v CCSR [2022] HKFC 238 by HHJ I Wong at paragraph 86 therein:

86. … English Court of Appeal held that in the event of non-disclosure of a party's financial resources in a financial remedies case, the court was not obliged to give a precise figure or bracket for the undisclosed resources before making an order. Instead, it should: (i) seek to determine the extent of the undisclosed resources; (ii) draw such adverse inferences as were justified; and (iii) where appropriate, infer that resources were sufficient that the proposed award represented a fair outcome. Moylan LJ said,

86. My broad conclusions as to the approach the court should take when dealing with non-disclosure are as follows. They are broad because, as I have sought to emphasise, non-disclosure can take a variety of forms and arise in a variety of circumstances from the very general to the very specific. My remarks are focused on the former, namely a broad failure to comply with the disclosure obligations in respect of a party's financial resources, rather than the latter.

87. (i) It is clearly appropriate that generally, as required by section 25, the court should seek to determine the extent of the financial resources of the non-disclosing party.

88. (ii) When undertaking this task the court will, obviously, be entitled to draw such adverse inferences as are justified having regard to the nature and extent of the party's failure to engage properly with the proceedings. However, this does not require the court to engage in a disproportionate enquiry. Nor, as Lord Sumption JSC said, should the court “engage in pure speculation”. As Otton LJ said in Baker v Baker [1995] 2 FLR 829, inferences must be “properly drawn and reasonable”. This was reiterated by Baroness Hale of Richmond JSC in Prest v Prest [2013] 2 AC 415 , para 85:

“the court is entitled to draw such inferences as can properly be drawn from all the available material, including what has been disclosed, judicial experience of what is likely to be being concealed and the inherent probabilities, in deciding what the facts are.”

89. (iii) This does not mean, contrary to Mr Molyneux's submission, that the court is required to make a specific determination either as to a figure or a bracket. There will be cases where this exercise will not be possible because the manner in which a party has failed to comply with their disclosure obligations means that the court is “unable to quantify the extent of his undisclosed resources”, to repeat what Wilson LJ said in Behzadi v Behzadi [2009] 2 FLR 649 .

90. (iv) How does this fit within the application of the principles of need and sharing? The answer, in my view, is that, when faced with uncertainty consequent on one party's non-disclosure and when considering what Baroness Hale and Lord Sumption JJSC called “the inherent probabilities” the court is entitled, in appropriate cases, to infer that the resources are sufficient or are such that the proposed award does represent a fair outcome. This is, effectively, what Munby J did in both Al-Khatib v Masry [2002] 1 FLR 1053 and Ben Hashem v Al Shayif [2009] 1 FLR 115 and, in my view, it is a legitimate approach. In that respect I would not endorse what Mostyn J said in NG v SG [2012] 1 FLR 1211, para 16(vii).

91. This approach is both necessary and justified to limit the scope for, what Butler-Sloss LJ accepted could otherwise be, a “cheat's charter”. As Thorpe J said in F v F [1994] 1 FLR 359 , although not the court's intention, better an order which may be unfair to the non-disclosing party than an order which is unfair to the other party. This does not mean, as Mostyn J said in NG v SG, at para 7, that the court should jump to conclusions as to the extent of the undisclosed wealth simply because of some non-disclosure. It reflects, as he said at para 16(viii), that the court must be astute to ensure that the non-discloser does not obtain a better outcome than that which would have been ordered if they had complied with their disclosure obligations.

35.  It has been said where a party has been guilty of not making full disclosure, he could not complain if uncertainties were determined against him: L v C [2007] 3 HKLRD 819, at paragraph 191(2). And for completeness, in the case of NG v SG (Appeal: Non-Disclosure) 2011 EWHC 3270 (Fam), [2012] 1 FLR 1211, paragraph 16 (viii) reads as follow:

“The Court must be astute to ensure that a non-discloser should not be able to procure a result from his non-disclosure better than that which would be ordered if the truth were told. If the result is an order that is unfair to the non-discloser it is better that than that the Court should be drawn to into making an order that is unfair to the Claimant.”

Issues

36.  Following our statutory provisions and the well-trodden principles of LKW v DD; the following issues fall to be determined:

a.  H’s US property

b.  H’s Pension

c.  L Ltd

d.  Other financial resources

e.  Parties’ earning capacities

f.  Parties’ respective liabilities

W’s Case

37.  W says that during the marriage, the standard of living is relatively high, and H used to contribute $100,000 per month towards family expenses, most of which was paid by H. After the Petition, H reduced his financial support, including stopping his payment for rent, and only contributed $30,000 to $35,000 per month. From August 2023, H stopped paying for anything towards W and E except for E’s plane tickets to the US, some of her clothing in the US, E’s health insurance and her mobile phone bills.

38.  It is W’s case that H has not made full and frank disclosure. She contests the H’s ownership in the NY Property (legal ownership of 50% versus his claim of 1/3); and the loan from H’s brother D since 2009. She specifically says that she disagrees with H’s company (“B I Ltd”) being of zero value, but has to accept this due to his delayed declaration that it is of no value in his latest Form E filed only on 3 February 2025 (versus US$50,000 from his first Form E in January 2023), so as not to derail the trial.

W’s Open Proposal

39.  Based on W’s assessment of the matrimonial pot, the net value would be $18,474,218 (with negative balance on her side), and H is to pay her $10,148,800.

40.  As for E, she asks for:

a.  Monthly maintenance of $30,000 per month to be back dated to August 2023.

b.  H to pay for E’s medical insurance premium.

c.  H to pay for all travel and all related expenses when he has access to E.

H’s case

41.  In brief, H’s case also alleges that W has failed to provide full and frank disclosure, in particular that of her three companies, S Ltd, G Ltd and L Ltd. He contests the values of these companies and claims that he did not comply with the previous Orders for valuation because he was a litigant in person. W says that with regard to the valuation issue, her solicitors had reached out to H on 4 occasions, but to no avail: (1) 4 January 2024, with a list of properties and assets which requires valuation (2) 1 February 2024 a chaser to the previous letter (3) 16 May 2024 when she set out her proposed valuation in an Asset and Liabilities Schedule to be agreed for the CMH on 18 June 2024 and (4) 22 December when she proposed valuation in the Asset and Liabilities Schedule which was supposed to be agree for the PTR hearing on 10 January 20254. H did not respond to any of these correspondences.

42.  H maintains his 1/3 interest in the NY Property, and he says he owes his brother D the sum of $14,179,459 being rent, expenses relating to the NY Property and charges under an American Express (“AE”) Card since 2009.

H’s Open Proposal

43.  H’s open proposal says that it is difficult for him to give an absolute figure on how the family pot should be divided, although he agrees to a 50-50 split of the family pot. But then adds that if Court considers that W’s material non-disclosure is “so appalling so as to leave the court with no reliable figure to add back to the value of the family pot”, then Court should award a larger portion of the family pot to him.

44.  Against this stance, H’s open proposal contained in his counsel’s opening submission is best quoted in full:

a.  H has a negative net assets value of $6,616,528,42, and this negative value will not be shared with W.

b.  W has a positive net asset value of $1,154,025.10, W should transfer half of this amount to H in a lump sum.

c.  H will provide E with $3,500 per month.

45.  The following table is adopted from the W’s opening submission of the parties’ respective positions:

		Petitioner W (decimals removed)	Respondent H (decimals removed)
1	Real Property		8,385,000 (W says)    5,584,410 (H says)
2	Bank accounts	89,134	47,883
3	Company S/H	1,552,006 (W says) 1,649,261 (H says)	Nil
4	Personal valuable	215,000	147,642
5	Retirement Fund / MPF	288,596 (W says) 480,993 (H says)	11,079,115 (W says)    2,056,727 (H says)
6	ASSETS	2,114,737 (W says) 2,434,389 (H says)	19,659,640 (W says)    7,836,662 (H says)
7	LIABILITIES	3,026,427 (W says) 530,364 (H says)	273,731 (W says) 14,453,190 (H says)
8	NET ASSETS	-911,690 (W says) 1,904,025 (H says)	19,385,909 (W says)   -6,616,528 (H says)

Discussion

H’s Financial Position

H’s brother D (“D”)

46.  The analysis of the H’s cases must be considered against the role that D plays in H’s life.

47.  As rightly submitted by W’s counsel, D is critical to a large part of H’s evidence. In particular, H’s percentage interest in the NY Property, and H’s allegation of debts owed to D or his company (“FS”). H had not sought to join D to these proceedings to enable D to corroborate his case nor is D appearing as H’s witness.

48.  Deadline for interlocutory applications were given as early as April 2023, and Directions for interlocutory proceedings including Joinder were made on 7 November 2023; H took no action upon both Orders.

49.  H says that his brother and him had fallen out, and they no longer talk to each other; he says that D indicated that he did not wish to be involved with these proceedings (this is despite D having issued a Partition Summons regarding the NY Property against H in 3 March 2023, which was issued only 4 months after the divorce petition (“D’s Partition Summons”).

50.  D’s Partition Summons records his allegation of the ownership of the NY Property and the brothers’ respective contribution to it; inter alia, it asks for the sale of the property and division of net proceeds according to their “respective rights and interest therein”. However, it is quite clear in evidence that as at the date of this hearing, and for almost two years, there was no further progress in the US on D’s Partition Summons and H says that he has not been served with it.

H’s US Property

51.  H’s interest in the NY Property is one of the largest assets in the matrimonial pot, the agreed value for this is US$2,150,000 ($16,770,000 at 7.8). H is the co-owner of this property with D, yet he says he only has 1/3 interest which is $5,590,000; while W says that his half share is $8,385,000.

52.  In his affidavit, he says that there is an understanding that D would cover all the property-related expenses while he would be responsible for one-third of the mortgage repayments; and that this understanding is “reflected in our respective contribution to the US Property”. He says he ceased contributing in 2007 and D assumed the full financial burden and fully discharged the mortgage balance of the NY Property in 2012. H went on to say in early 2023, that due to the heavy expenses associated with the NY Property, he intended to empty D’s belongings from the house and list the property in the market for rental return; but D stopped him and prevented him from doing anything further with the property with his issuance of D’s Partition Summons.

53.  H’s evidence on his case was his production of some cheques which he says show that he paid US$3,000 each month for the US mortgage and is allegedly 1/3 of the mortgage payment due. The exhibit he relies on shows copies of 38 cheques of which only 5 were for the amount of US$3,000. These cheques were dated 2006 and quite illegible, and those with the amount US$3,000 show a payee’s name which appears to read “COUNTRYWIDE”, but there is no other documentary evidence that link these to mortgage payment. It is also quite strange to me when there are two owners to a real property in the US, that a mortgagee institution would accept two payments for the monthly mortgage; as said, I have no evidence to enlighten me on this.

54.  H also relies on a letter from D’s US lawyers to H’s US lawyer dated 4 January 2023 (which I notice was two months after W’s Petition and prior to D’s Partition Summons) proposing to negotiate D’s rights over the NY Property and attached an excel spreadsheet of what D, and in part, H had paid for the property. It was recorded therein that H had paid for 1/3 of the mortgage payment of US$9,000 for 48 months between 1997 to 2001. While W argues that H had not produced any document to show any statement which proves the total monthly mortgage payment; and that that this does not mean that H has only 1/3 ownership. The excel spreadsheet also records that D has contributed US$1,909,605 to the equity of the NY Property and US$871,740 towards fixtures and utilities while H has contributed $144,000; a point which I will come back to below.

55.  W also rightly points out that D’s Partition Summons contradicts H’s own case as follows:

“a.  At paragraph 1 of the Summons, D states that the US property is “held equally as tenants in common” by him and H.

b.  At paragraph 7 of the Summons, D states that he “at all times mentioned, was and still is the owner of a fifty (50%) percent undivided interest in the premises described herein”.

c.  At paragraph 8 of the Summons, D states that H “was and still is the owner of a fifty (50%) percent undivided interest in the premises described herein.””

56.  The above-mentioned discrepancy in D’s Partition Summons and H’s case was not taken up prior to the hearing including his opening submission. But under cross examination, and for the first time since the case was brought, he mentioned something which he calls the “gentlemen’s agreement” with his brother (the “Gentlemen’s Agreement”). He says that by this apparently unwritten agreement, he would pay 1/3 of the mortgage and have 1/3 interest in the NY property, with no liability on expenses. He says that it is because D is now upset with him and therefore claims that H has ½ of the interest of the US Property in order to get him to pay ½ of the expenses:

“Now, in order for him, since he’s agitated by me and he’s upset by what I’ve done back in 2023, he decided to -- instead of saying that he said that he will pay the expenses, now he wants to calculate the expenses with me 50‑50. So that’s why he put in there that I own 50 per cent of the house, so he can calculate $4 million worth of expenses 50-50.

57.  It is also H’s case now that he owes D money for expenses that the latter paid for the NY Property, this will be further examined under H’s liabilities.

58.  In H’s answers to W’s questionnaire, he says that he estimated his interest in the US Property is based on the amount of mortgage payments he made. W’s counsel also rightly submits that this could not be correct if there was indeed a Gentlemen’s Agreement in place as there would be no need to calculate nor estimate.

59.  W adds that H never told D that he intended to move into the US Property in December 2022, then further intended to remove D’s assets from the NY Property so that he could rent it out, are not actions of someone who has a minority interest.

60.  The question I need to be satisfied with is whether the payment of allegedly 1/3 of the mortgage payment is evidence to support H’s allegation that he holds only 1/3 of the NY Property interest and do I believe that the Gentlemen’s Agreement really exist? Remembering here that I am not satisfied with his cheque payments evidence as there is no link to a mortgage obligation. And that for this payment US$3000, D says H only paid 48 months (from his aforementioned lawyer letter of Jan 2023) while H says he paid 118 instalments between 1997 and 2007; the brothers’ versions of events are different. H continues to claim that he has 1/3 interest (saying it is based on his contribution to the mortgage) even when his mortgage payments towards this property had not been consistent and he stopped part way; and going back to D’s spreadsheet mentioned in paragraph 54 above, if respective contributions, in mortgage or otherwise, is to be considered, H’s interest in the NY Property could not be 1/3; I do not take the view that the payment of the mortgage amount, is synonymous with his actual beneficial interest in the property. Furthermore, hearing his oral evidence on the Gentlemen’s Agreement, I do not find his recount to be credible.

61.  The principle is trite that beneficial interest follows legal interest, and the party alleging that the beneficial ownership differs from the legal one, has the onus to prove such allegation. I fail to see how H has put up sufficient or any cogent evidence to prove that, on a balance of probabilities, his beneficial interest is different from the legal title of the NY Property; ironically, the evidence he produced of D’s Partition Summons also contradicts his case.

62.  In the circumstances, I am of the view that 50% of the share of the NY Property should go into the matrimonial pot.

H’s Pension

63.  H has a US Pension fund with Charles Schwab Corporation, from his latest updated Form E as at 29 January 2025, it was at US$1,420,399, i.e. $11,079,116.

64.  The dispute on this item comes down to the amount of this US Pension to be taken into account:

a.  based on duration of marriage, and

b.  considering whether a discount is to be applied due to the time when the pension amount will be available to H, and

c.  what rate of tax is to be applied when H withdraws the pension.

Duration of the marriage

65.  The portion of the pension that should be taken into account is the duration of the marriage over the period of time during which that pension was accumulated. H cites my decision in RPB nee RGP v CFB [2024] HKFC 84.

66.  H submits that he established his company B I Ltd in NY in August 1992 at the age of 26, counting up to the trial is 33 years; during which he was married for 14 years from 2008 to 2022. W did not challenge this calculation in her case.

67.  The portion of the pension to be attributed to the matrimonial pot is therefore $11,079,115 × 14/33 = $4,700,230 (US$602,593 at 7.8).

Illiquidity discount

68.  It is well established that in considering the role of pension in a matrimonial pot, an illiquidity discount could be applied if the pension will not be available to the relevant party immediately.

69.  HHJ I Wong case of SSLT v SMFC [2019] HKFC 250 (para 44-48) and LWF v WST [2021] HKFC 164 (para 49-50) laid down the principles succinctly :

“44. It is not in dispute that the pensions and the retirement accounts could only be realized upon the parties’ retirement, probably when they reach the age of 65. Both are now 43 years old; there are still more than two decades to go before the money could actually goes into their pockets. It must be correct that a distinction must be drawn between an asset, which can be realized for cash and thus freely available and one, that is not realisable and non-transferrable. Regardless of whether it is in the form of a provident fund or a pension (ie a lump sum or an income stream), the money that the parties would receive on retirement is not an available capital asset.

45. It is thus necessary for the court to have regard to the extent to which an asset is freely available or whether it is attended by a particular handicap or risk. If the full value of these assets are taken, given that the husband has far more assets of this nature than the wife; in all likelihood he would end up of having more illiquid assets. I agree with Ms Chan that this would be unfair to the husband. A similar case can be found in Martin-Dye v Martin-Dye [2006] 1 WLR 3448.

46. In DGB v SDGK, FCMC 12078/2013 (unreported, date of judgment: 12 March 2014) where the husband in that case was 47 years old, I gave a discount of 40% on the face value of the husband’s MPF.

47. In another case S v S, FCMC 6574/2003 (unreported, 14 March, 2005) Deputy Judge C.K. Chan (as he then was) accepted the husband’s case that his pension fund is illiquid and the judge included a nominal 10% of the present value of the pension into the calculation.

48. It is of course axiomatic that the facts of every case are different and so the two cases cited in the foregoing paragraphs are for reference purpose only. It is rather unfortunate that the parties, in particular the husband, have chosen not to adduce any professional actuarial assessment. However, for the reasons that I have elaborated and bearing in mind Riberio PJ’s advice that a broad-brush approach is all that is required at this stage: LKW v DD, at [72], I consider it is not unreasonable that a 50% liquidity discount should be applied. I would give a 50% discount across the board on assets of this nature.”

70.  H was born on 15 April, 1966. As at the date of the writing of this judgment, H is more than 59.5 years of age. So contrary to the abovementioned cases, H actually can access his pension fund now; on this basis, there is no need for an illiquidity discount to be applied.

Tax on Pension

71.  W argues that there should be no discount given to the pension fund on the basis of income tax payable on withdrawal of funds and the whole amount should be taken into account in the matrimonial pot.

72.  In H’s affidavit, he says he can withdraw the pension fund without incurring additional taxes after reaching the age of 59.5, and he says it is subject to income tax of around 44.2% quoting his source from an Income Tax calculator for NY called “talent.com”. It is of note that this calculation of 44.2% is produced by his inserting the amount of pension as income, not withdrawal of pension. He also says tax will be lower if funds are taken out when he turns 65 years of age. There is no information to support this contention except for what he says in his affidavit.

73.  Furthermore, it is my view that the calculation in H’s opening submission is incorrect. Based on the pension amount of $11,079,115, and his allegation that the tax payable on this sum is 44.2%, H’s counsel submits that the net asset value of the pension amounts to $4,896,969. But this sum is 44.2% of the pension amount, which is the tax payable, not the net assets value of the pension sum. H then applies the marriage duration to this amount (translating 14/33 into 42%) to arrive at his $2,056,727. As H’s basis is incorrect, the number he arrived at is therefore erroneous.

74.  As for the issue of applicable taxes, contrary to what H says, W says that she has sought advice from a US CPA who states that the tax payable by H on withdrawal of his pension fund ranges from 10-37% depending on his total taxable income during a financial year. She also says that the H’s quote of 44.2% is likely to be where the entire balance of his pension is withdrawn in the same year. It is of note that what W produced was an email to a CPA in February 2025, and her question relates to withdrawal from a US person’s Individual Retirement Account (IRA).

75.  W submits that as H’s pension will continue to accrue until withdrawal (quoting that his pension was US$897,995 per his first Form E of January 2023 to US$1,420,399 per his updated Form E of February 2025 which represents an increase of 58% over this time), W therefore says there should be no discount on the basis of H’s income tax payable on withdrawal of his pension.

76.  My information is limited to the tax rate provided by the parties, I am inclined to accept the W’s version more. As mentioned above, H’s calculation comes from a webpage called talent.com, and he inserted the total amount of pension as “income”, while clearly W’s question to a CPA pertains to taxation on withdrawal of a retirement sum. I also take the view that the H is not expected to withdraw the whole of his pension amount. As the amount to be placed into the matrimonial pot based on duration of marriage is US$602,593, and only half of that sum is likely to be shared by W and may need to be withdrawn by him ie US$301,296.5, the applicable federal income tax rate applicable should be 35% based on W’s CPA’s email. The amount to be placed into the matrimonial pot, after a notional 35% tax has been applied on the full amount, should therefore be US$602,593 × 65% × 7.8 = $3,055,146.

H’s Liabilities

77.  According to the joint table, the amount of H’s liability which is not in dispute is $273,731.

78.  The amount of the liability which is in dispute is the amount he owes to his brother D of $14,179,458. The following was tabulated by W’s counsel from H’s evidence and set out in her closing submission annexure:

Debtor	Description	$	Date
D / FS	Rent	4,272,000	April 2009 to March 2013, November 2018 to October 2022
D / FS	AE Card charges	4,524,910	2009 to 2010, 2015 to 2022
D	Expenses re NY Property	5,382,548	1997 to 2023

Rent and AE Card Charges

79.  According to the H’s Form E, D had been paying for H’s rental in HK over the years and also providing the use of his company FS’s AE credit card for H’s use.

80.  For rental, the information provided by H, with the exception of missing information between March 2013 to October 2018, shows that D had been paying the rental in the range of $31,000 to $52,000 per month for H from 2009.

81.  For the AE card, H has missing information between 2011 to 2014, but from 2015 to 2022, he produced self-prepared spreadsheets of the AE card spending without any source documents. He claims that as he is not able to produce the monthly statements of the AE card because only D can request for statements as he is the primary card holder.

82.  It is hard to understand how several pages of 5 years month-by-month itemized breakdown of spending could be prepared without the monthly statements. Further perusal of these numbers illustrated to me the amount paid by D on H’s behalf for various aspect of spendings for those years. A quick tally on my part shows a conservative estimate of the following total annual spending: $857,000 in 2015, $570,000 in 2016, $345,000 in 2017, $390,000 in 2018, $524,000 in 2019, and $313,306 in 2020.

83.  W disputes these liabilities, calling this either an unconditional financial support / gifts from D or at best soft loans. H has never produced any loan agreement or repayment schedule, and admitted that there had not been any repayment over the years. Under cross examination, He says he would repay D when he is financially able but had no idea when this would be.

84.  Neither is there any evidence that D had ever sought repayment.

85.  W’s counsel submits the case of P v Q [2022] WLUK 268 with reference to soft loans, for completeness and reference, the relevant paragraphs from His Honour Judge Hess are quoted below:

19. …

(viii) The first question is whether these advances should be regarded (in strict legal terms) as gifts or loans. As a matter of general principle, for an advance of money to be a gift there must be evidence of an intention to give – the animus donandi. In neither instance in this case has either party produced persuasive evidence of such intention in the respective advancing parent and I am inclined to accept what the husband’s mother told me and what is contained in the 2004 document. On the face of it, both these transactions are loans which could, in theory, be enforced.

(ix) In the family court, however, that is not the end of the matter because the inclusion or exclusion of a technically enforceable debt in an asset schedule can depend on its softness/hardness. This is perhaps an elusive topic to nail down, but it falls for determination in the present case as in many others. I have looked at a number of authorities which deal wholly or partly with this point and I include the following in that category: M v B [1998] 1 FLR 53; W v W [2012] EWHC 2469; Hamilton v Hamilton [2013] EWCA Civ 13; B v B [2012] 2 FLR 22; Baines v Hedger [2008] EWHC 1587; and NR v AB [2016] EWHC 277. I have also looked at an article by Alexander Chandler (as it happens the FDR tribunal in this case) on the subject: Family Loans an intervener claims – taking the bank of mum and dad to court [2015] Fam Law 1505. I derive the following summary of principles from this reading:-

(a)  Once a judge has decided that a contractually binding obligation by a party to the marriage towards a third party exists, the court may properly wish to go on to consider whether the obligation is in the category of a hard obligation or loan, in which case it should appear on the judges’ computation table, or it is in the category of a soft obligation or loan, in which case the judge may decide as an exercise of discretion to leave it out of the computation table.

(b)  There is not in the authorities any hard or fast test as to when an obligation or loan will fall into one category or another, and the cases reveal a wide variety of circumstances which cause a particular obligation or loan to fall on one side or other of the line.

(c)  A common feature of these cases is that the analysis targets whether or not it is likely in reality that the obligation will be enforced.

(d)  Features which have fallen for consideration to take the case on one side of the line or another include the following and I make it clear that this is not intended to be an exhaustive list.

(e)  Factors which on their own or in combination point the judge towards the conclusion that an obligation is in the category of a hard obligation include (1) the fact that it is an obligation to a finance company; (2) that the terms of the obligation have the feel of a normal commercial arrangement; (3) that the obligation arises out of a written agreement; (4) that there is a written demand for payment, a threat of litigation or actual litigation or actual or consequent intervention in the financial remedies proceedings; (5) that there has not been a delay in enforcing the obligation; and (6) that the amount of money is such that it would be less likely for a creditor to be likely to waive the obligation either wholly or partly.

(f)  Factors which may on their own or in combination point the judge towards the conclusion that an obligation is in the category of soft include: (1) it is an obligation to a friend or family member with whom the debtor remains on good terms and who is unlikely to want the debtor to suffer hardship; (2) the obligation arose informally and the terms of the obligation do not have the feel of a normal commercial arrangement; (3) there has been no written demand for payment despite the due date having passed; (4) there has been a delay in enforcing the obligation; or (5) the amount of money is such that it would be more likely for the creditor to be likely to waive the obligation either wholly or partly, albeit that the amount of money involved is not necessarily decisive, and there are examples in the authorities of large amounts of money being treated as being soft obligations.

(g)  It may be that there are some factors in a particular case which fall on one side of the line and other factors which fall on the other side of the line, and it is for the judge to determine, looking at all of these factors, and maybe other matters, what the appropriate determinations to make in a particular case in the promotion of a fair outcome.

(emphasis added)

86.  I agree with the W’s submission. And applying the principles above, there is a lack of supporting documents of these alleged liabilities, there was never any demand for repayment from D, nor repayment of these sums from H to him. These liabilities span decades and is a clear case of D being an unwavering financial support to H over the years. These are not modest sums, if D has not chased for the last 15 years, I see no evidence that these are debts for which repayment is being or likely to be enforced; I therefore do not accept that these are actual liabilities that should be taken into account.

Expenses with regard to the US Property

87.  With regard to the expenses H says he owes to D who has paid for expenses with regard to the NY Property, H says he has to repay half to D.

88.  I will start with saying that my acceptance of H’s ½ interest in the NY Property does not automatically mean that I accept he has to pay ½ of the expenses.

89.  H takes a rather confusing position because he says that with the alleged Gentlemen’s Agreement, on which he appears to rely to assert his 1/3 interest, there is no need for him to bear any expenses. Then on his own case, he does not owe D any expenses the latter has paid on the NY Property.

90.  Then he says that because he has fallen out with D, the latter is now saying he has ½ interest in order to make him pay for ½ of the expenses incurred.

91.  Clearly, H cannot have the best of both arguments to support his case, that is, he only has 1/3 interest but still owes D ½ of the expenses of the NY Property. This dichotomous position is not accepted.

92.  For this debt, he says he is relying on the letter from D’s lawyers and D’s Partition Summons, and some text messages in July 2022. For the letter from H’s lawyers in January 2023 which quotes gross amounts for various expense items, and invites mediation with H to discuss issues amicably as H has placed an alarm on the property and refused to provide access and code to D; there is no demand for repayment of expenses, nor supporting documents to the expenses paid. For D’s Partition Summons, as discussed above, this talks about the joint ownership of the property, there was no demand by D for ½ of the expenses he had pay, nor does it state an amount due from H to his brother, this Summons was never served on H and clearly not proceeded for two years up to the time of trial. Thirdly, with reference to the text messages, which revolved around password / code for the property, there was mention by D asking H to stop using the AE card, he also said “Start to fulfil your financial obligation toward the expenses of the house and upkeep”, but there was no mention of the past expenses incurred, nor was there any demand for repayment of such expenses, nor does it, in and of itself, prove a broken relationship between D and H.

93.  I fail to see how the above could be relied upon to support that H’s case that he owes his brother D the amount of $5,382,548 for expenses relating to the NY Property. Again, D has never sought repayment of H’s share of the expenses since they acquired the property in 1997.

94.  I am mindful that D is aware of these proceedings as H says D does not wish to be involved, despite that, D has not sought to recover the money he or his company FS has paid for H when he should be aware that H’s assets and liabilities would be taken into consideration in his divorce. I have also wondered why H does not seek to share his liabilities with W in his open proposal, this was never explained. In the circumstances, I will not be taking this item of liability into consideration in the calculation of the matrimonial pot.

W’s Financial Position

W’s Companies

95.  W has three companies: S Ltd, G Ltd and L Ltd.

S Ltd

96.  W owns 99.9% of this company, she contends that the parties had at the Specific Discovery Summons hearing on 28 February 2025 agreed that the value of S Ltd is $20,113 being the net asset value as stated in the 2024 AFS, and her % share is $20,093. Such value appears under the agreed schedule of assets of the parties joint documents, and was not taken up as issue in the H’s submissions. This is therefore the adopted value of this company.

L Ltd

97.  This is a company in which W has an interest. It is not in dispute that this company has been dormant for many years, and there is cash in the bank of $424,183.75. The dispute rests with how much of this amount should go into the matrimonial pot.

98.  W says the following:

a.  W has produced a Profit Distribution Agreement (“PDA”) pursuant to which W could only receive 5% of the L Ltd’s profits. Her calculation of her entitlement referenced in her closing submission, is (1) 5% of the funds in L Ltd’s ICBC USD Account (which contains the fees from the one and only project taken on by the company), plus (2) 30% of the funds in L Ltd ICBC account, (which contains the start-up funds paid by W and her co-shareholder DB respectively). This comes up to $27,775.

b.  She has fallen out with DB, who is the majority shareholder of the company, and says she would not be able to withdraw any cash held in L Ltd’s account without the consent and physical presence of DB.

c.  Therefore, W’s position is that the value of her shareholding in L Ltd is $0.

99.  H says that as her shareholding in L Ltd is 30%, the value attributable to her is $424,183 × 30% = $127,255.

100.  H challenges are as follows:

a.  the validity and enforceability of the PDA, saying first that it was only produced for the first time on 19 February 2025, and it was unsigned. Under cross examination, she says that she only has the unsigned copy as DB did not give the signed copy to her after she signed in Shanghai.

b.  H also says that there is no transaction record or evidence to show that the alleged profits of the one single project have been deposited to the ICBC USD account, upon which the 5% (if the PDA is accepted) could be applied.

c.  The said PDA was from 2013, H says H has not provided explanation as to why it was never enforced over the past years.

d.  H questioned why W was able to produce L Ltd’s banks statement for January 2025. To which W says, the statements are sent to her office, but she did not open them because “nobody can access the company anyways”. H’s counsel argues that she would not be able to produce bank statement if she had no access to the account. I am of the view that this latter argument is fallible. Bank account statements can be sent to W, but according to her, release of funds require joint signatures.

e.  H also raised in his submission that money in ICBC had diminished from $466,987 in 2015 (as seen from L Ltd AFS of 2015) to $424,183 in 2025. To this, W’s counsel submits that despite extensive cross examination by the H, this question was not asked, nor put to W, and therefore H is not entitled to rely on this point.

101.  For W’s case, and under cross examination, W said that she had tried to ask and “beg” DB to resolve this matter between them but to no avail. Her accountant told her that if she wound up the company, she would not have access to the funds therein.

102.  In hearing her oral evidence in support of her case regarding the PDA, I accept W’s explanation of the circumstances surrounding the unsigned PDA and that an agreement did exist as to her share of the project. The agreement dated July 2013 refers to the amount of the project being US$55,000, which translates into $426,250 at an exchange rate of 7.75, and tallies with the amount appearing in the 2015 AFS as revenue received in 2014.

103.  As to the nature of the cash with ICBC, I notice from L Ltd’s 2015 AFS that the company was incorporated in May 2013, and this amount of $426,250 was logged in the 2014 AFS as revenue for “Lighting consultancy and design income” and is the amount appearing as part of the “cash in bank” in 2014.

104.  Drawing all the strings together, I accept that the amount with ICBC does, on a balance of probabilities, relate to the project W referenced in the PDA. I therefore accept that she is entitled to 5% of the net profit therefrom. According to the PDA, the net amount after expenses was US$40,424, her 5% amounts to US$2,021.21 (as shown on the agreement), which is $15,662 at the same exchange rate of 7.75.

105.  I also accept W’s calculation of the amount due to Directors, recorded as $26,255 and $10 in share capital, and her 30% entitlement thereof is $7,880.

106.  By my calculation, the value of W’s entitlement in L Ltd is $23,542 ($15,662 + $7,880).

107.  While I am inclined to accept W’s evidence that the bank account requires joint signatures to access, this is not the basis of placing $0 on the value of L Ltd. Her interest in L Ltd should be taken into account regardless of whether she can access these funds.

G Ltd

108.  W owns 50% of G Ltd.

109.  W says the value of G Ltd is not in dispute. Parties have agreed on 28 February 2025 to use the NAV on the 2024 AFS, which is $3,003,826, 50% of W’s interest is therefore $1,501,913.

110.  While agreeing to the value of G Ltd, H questions the loan W has from G of $750,000 which H says lacks supporting evidence. This will be explored under W’s liabilities below.

111.  W says the loan appears in the G Ltd AFS 2024, which was audited by a certified public accountant, and H has not sought a re-audit of G Ltd’s financial statements. I agree with this position and H has not put forward any evidence except for making a sweeping statement that the Court should draw adverse inference against W of this outstanding loan.

W’s MPF

112.  W has two local MPF accounts, one with Manulife and one with BCT, the total amount of which is $288,596. W proposes a 40% discount on this number as she is at least 16 years away from access to her MPF fund.

113.  Using the same approach as above, I should look at the duration of the marriage and the time from which the two MPFs starts accumulating. I do not have information on the latter, but intends to start from 2009 which was when the parties relocated to HK, until 2022 when the petition was taken out. Applying the formula of 14 years of marriage over 16 years of accumulation of the HK MPFs, this comes to $252,521.

114.  I find the W’s proposal of 40% discount to be reasonable, and therefore shall place $252,521 × 60% = $151,512 into her side of the matrimonial pot.

W’s Liabilities

115.  According to the joint table, the amount of W’s liability which is not in dispute is $530,364.

116.  W’s liabilities which are in dispute fall into two main sums:

a.  The Director’s loan from G Ltd of $750,000

b.  Loans from his father LM $1,746,063

Loan to G Ltd

117.  This amount of loan due by W to G Ltd is recorded in the company’s financial statement, $750,000 being an updated number in the 2024 AFS. W says that this was a properly audited AFS by a certified public accountant, who has prepared the AFS in accordance with the relevant standards. H has not challenged the G Ltd AFS to a re-audit.

118.  H merely complains that there were no supporting documents in terms of loan agreement or a board resolution etc to this liability owes to G Ltd.

119.  I accept W’s argument on this, an AFS prepared by a professional should have looked into documents in support in its preparation so there must have been basis for the $750,000 liability so documented; there is no evidence put forward by H that the AFS could not be relied upon; in the circumstances, I accept this as a credible liability on the W’s side of the balance sheet.

Loans from her F

120.  W says she owes money to her father for her health insurance, Jewish community club membership, living expenses, rental, E’s school fees and legal fees, for a total of $1,746,063. She has produced some promissory notes and records of payment via her solicitors by their letter of 20 March 2025:

Date of Promissory note or loan	Amount ($)	Purpose
10/9/2024	315,468.5	Legal
31/10/2024	43,000	Rent
1/11/2024	120,500	School Fees
2/12/2024	294,943	Legal
5/12/2024	43,000	Rent
17/12/2024	32,160	Travel
19/12/2024	20,000	Legal
9/1/2025	150,000	Rent and School Fees
6/2/2025	43,000	Rent
24/2/2025	175,000	Legal
27/2/2025 (no P/N)	140,000	Rent and School Fees
5/3/2025 (no P/N)	209,161	Legal
	1,586,232.5

121.  W produced all transfer records of the above transactions, all except three were paid directly by F to the respective payees; and all were supported by Promissory notes that W has issued in favour of her father but for the last two. She says that some earlier loans from her father were not documented, according to the above, the difference would be $159,831.

122.  Furthermore, W has pledged her shares in the above-mentioned three companies to her father for these loans, the date of the document is 24 February 2025. W also says she will not be able to borrow any further from her father as there have been objections from her siblings.

123.  H’s objections are as follows:

a.  His first argument on this is that these loans were not found in her Form E dated 13 January 2023 and that these were incurred after separation and or commencement of the proceedings, and some one or two months prior to the trial. I find nothing wrong with this, H left HK in December 2022, his maintenance towards the family was unilaterally reduced, he stopped paying for the rent of the FMH and then maintenance toward home and E. Naturally, W had to look for assistance and had to relied on her own resources until such time as she has to turn to her father. Legal fees should also have accumulated over time, and understandably incurred very close to this ancillary relief trial in particular when the H decided at the last minute to suddenly make his appearance.

b.  H then says that other than the promissory notes, she has failed to provide “transfer receipts, remittance notices, and / or relevant bank statements for the amounts”, he remarks that these were requested by H’s solicitors on 14 March 2025, which I notice was barely 10 days before the trial. I have found inside the trial bundles a letter from the W’s solicitors dated 20 March 2025 responding to the H’s solicitors, attaching supporting documents of these transfers, with which I am satisfied to have addressed the ask for supporting documents.

c.  H then objects that the loans after separation are for W’s living expenses and not for the benefit of the family. I do not agree with this objection, it is clearly documented that the loans were for rent, and E’s school fees, and a rather modest amount for W’s and E’s travel. I am of the view that those loan amounts are for the benefit of the family.

124.  I am therefore unable to agree with H’ objections as above set out.

125.  My observation on the pledge document is this, relying solely on the numbers from the three companies as analysed herein, the total value of the three companies is $1,545,548, which includes the amount in L Ltd which W says she cannot access, the security given actually barely covers the amount she owes. That said, I do acknowledge W’s intention to provide security of the loan payments which she says she intends to repay from the earnings of the operating companies.

126.  On this issue, I draw guidance from the principles above mentioned from P v Q and make the following observations: It is quite clear that father has advanced money on behalf of W, the documentary evidence includes the promissory notes and payments directly to third parties, in particular the latter could not be disputed. I am conscious that this is a father-daughter relationship so it is not commercial in nature; and also accept there could not be enforcement by the father as the above loans were made only within 7 months before this trial. I also consider that the loan amounts as set out in the promissory notes, and backed by the pledge document is a written form of contractually binding obligation although my decision is not fully reliant on this point. I do not have evidence except for the W’s say so that this source of assistance from her father is drying up with the protest from her siblings. However, having reviewed W’s oral testimony in this regard, I accept that she does intend to “work harder” to repay these loans when she has the means, and that she seriously considers that these loans have to be repaid.

127.  P v Q also make reference to considering the sums that a creditor is likely to waive. I consider that the father’s assistance with regard to family expenses, including rental payments, and his grandchild’s school fees, and the small amount in travel are more likely to be soft loans and less likely to be enforced by F against W, hence those sums are more likely to be waived by him. However, I take the view that those paid towards legal fees are more on the side of a real / hard loan, considering the nature of those amounts and in the context of an ancillary relief trial where it is likely that some costs could be recoverable at the end of trial. I therefore consider that there would be expectation by W’s father to be repaid with regard to his payment towards legal fees from recoverable costs from the trial if an order is so made.

128.  On this basis, I shall therefore place only those relating to legal fees into her liabilities, but not the whole alleged sum. This item, by my calculation from the above table, is $1,014,572.

The Matrimonial Pot

129.  Based on my analysis above, my calculation of the matrimonial pot is as follows:

		Petitioner W (decimals removed)	Respondent H (decimals removed)
1	Real Property	Nil	NY Property   $8,385,000
2	Bank accounts	$89,134	$47,883
3	Company S/H	S Ltd $20,093	Nil
		L Ltd $23,542
		G Ltd $1,501,913
4	Personal valuable	$215,000	$147,642
5	Retirement Fund / MPF	$151,512	$3,055,146
6	ASSETS	$2,001,194	$11,635,671
7	LIABILITIES	$530,364 agreed $750,000 to G Ltd $1,014,572 to father	$273,731 agreed
8	NET ASSETS	-$293,742	$11,361,940

130.  The amount of the matrimonial pot is therefore $11,068,198.

H’s Income & Earning Capacity

131.  During the marriage, H works in his own company B I Ltd, of which he owns 100% and is a director, he continues to maintain this after he has moved to the US. His declared income according to his updated Form E comes to US$39,000 per annum, hence $25,350 per month (at 7.8), he also enjoys company benefits of US$5,000 per annum, which is $3,250 per month (at 7.8); and also monthly petty cash reimbursement of US$500. I do not have, nor was my attention brought to, any supporting documentation with regard to his declared income.

132.  W also reminds me that in the SIR dated 25 August 2023 which was around one and a half year prior to trial, H says to the SWO that he was making US$60,000 per annum, this translates into $39,000 per month. With this information, and absence of evidence to the contrary, I conclude that his earning capacity could be $39,000.

133.  W also says that H’s true income position is higher than what he disclosed which could be seen from his expenses, W relies on a table prepared by her lawyers on H’s spendings between January 2020 to December 2022 based on his bank accounts withdrawal and credit cards. This lengthy analysis consists of bank accounts in H’s name and of H’s company P Ltd spanning 24 months with an average spending of $54,007, bank account in name of B I Ltd with Chase bank spanning 36 months averaging $28,340 per month, and two US$ credit card over a period of 13 months averaging $173,629 per month. W says that these were his expenses before leaving HK and without the assistance from D. I also remind myself from above analysis that H also has his brother’s company’s AE card at his disposal during the relevant time and the spending in 2020 according to him was $313,306 which averaged $26,108 per month.

134.  Even with his updated Form E of February 2025, H’s expenses are as follows:

General	$33,972
Personal	$29,288
Children	$20,252
TOTAL	$83,512

135.  H was unable to explain how he could afford such expenses. Furthermore, when asked where he would live if not the NY Property, he said he would rent an apartment which costs between US$2,000 to US$4,000 ($15,600 to $31,200) per month. W submits, and I agree, that does not tally at all with an income of $25,350.

136.  With a declared income of $25,350 per month, and expenses more than three times his income, the uncontroverted conclusion on this is that his declared income is either not credible, or he has not fully declared his income source or he continues to have a lot of assistance from his brother D, with whom he says he is estranged.

H’s other resources

137.  It is very clear to me that D is H’s financial resource based on the well-established principles from our Court of Final Appeal decision of KEWS v NCHC (2013) 16 HKCFAR 1 at §§34-38:

E.3 Treatment of financial assistance from third parties under s. 7(1)(a)

34. The width of the wording of s 7(1)(a) of the MPPO will include financial assistance made by third parties to the parties to a marriage. Accordingly, such assistance made by a third party to the husband or wife may be taken into account in the computation of that party’s overall financial resources.

35. As stated in para 2 above, such third party assistance may take various forms. The authorities, to which I shall presently turn, show commonly trust situations or where relatives have provided financial assistance. There are of course other factual situations.

36. In every case where third party assistance is involved, there are two critical evidential questions for the court to consider:-

(1) What is the extent of the financial assistance provided by the third party to the husband or wife?

(2) What is the likelihood of such financial assistance continuing in the foreseeable future?

37. It goes without saying that in the fact finding exercise, the court must look at the reality of the situation and have regard to matters of substance and not just form. In looking at reality, the court can take into account not only what a party actually has, but also what might reasonably be made available to him or her if a request for assistance were to be made. In O’D v O’D [1976] Fam 83, which involved the court taking into account the financial support given to the husband by his father, Ormrod LJ said at 90 D-E ‘In making this assessment the Court is concerned with the reality of the husband’s resources, using that word in a broad sense to include not only what he is shown to have, but also what could reasonably be made available to him if he so wished’.

38. In addition, in looking at what may occur in the foreseeable future, past conduct is often a useful guide: see SR v CR (Ancillary Relief: Family Trusts) [2009] 2 FLR 1083, at 1091 (para 27).

138.  H contends that his relationship with D has turned sour, this is not accepted. D has not pursed his Partition Summons, he has never enforced any of the alleged amounts he advanced to H, H continues to live rent free at the NY Property, D has not asserted his rights over this property which is a subject matter of these proceedings. H’s expenses show that he is living beyond his income, so either there are assets or income that has not been disclosed, or D has continued to provide financial assistance despite the allegation of a broken-down relationship.

139.  On a balance of probabilities, I find that D has been and will continue to be a financial resource to H. This is a factor which will be considered in the context of addressing H’s future needs and his maintenance payment capacity.

W’s Income and Earning Capacity

140.  W works as a lighting design consultant; she has been working in this lighting business since 1999. She is shareholder of companies which have operating businesses.

141.  Her declared income is $38,500 which comes from S Ltd, of which she has a 99.9% interest, and an income of $3,500 from her father’s company. This totals $42,000. In terms of supporting documentation for her income, I make reference to its AFS 2024 produced via correspondence between solicitors on 19 February 2025, there is an amount of Director’s emoluments of $455,000, which breaks down to $37,916 per month.

142.  It is W’s case that she has limited earning capacity. She has little working experience outside of the lighting industry and she runs her own business as well as works for her father. She is now 48 years old, and she does not have a tertiary degree.

143.  H says she is young , her business in G Ltd is doing well and will be receiving substantial dividends from the business; on this basis, he argues that she does not need spousal maintenance.

144.  I accept W’s case of her income and earning capacity. As for reaping profits from the business, she still has a debt owed to G Ltd. She is not asking for a spousal maintenance so this is not an issue, it is therefore her case that she can manage her own livelihood from her earnings.

Assessing Parties’ Needs

W’s Financial Needs

145.  W asks for a clean break in her open proposal. In the circumstances, I still need to look at her general expenses as claimed, which according to her counsel’s submission, was not challenged by H in his narrative affidavit nor at trial, except for a general statement that it was exaggerated.

GENERAL	HK$
Rent	43,000
Utilities	5,500
Food	31,500
Household expenses	2,000
Domestic Helper	8,000
Insurance
Others: including entertainment subscriptions, Jewish Community Centre membership, expenses and activities, Kosher meats, Jewish festival related expenses	17,950
TOTAL : General	107,950

146.  While’s W’s counsel says that it is not challenged specifically, my initial observation is that the food item (to which I added the bottled water expenses from the “Others” column) is on the high side, particularly where there is already provision for kosher meat of $3,600; I would have, if I need to, bring this number to $20,000, making the total of general expenses $96,450.

147.  I would also put on record here W’s declared personal expenses are $48,700 per month. It is recognised that she is not asking for spousal maintenance from H, and I accept that she should be able to manage her expenses with her own income and from the Order to be made herein, with some adjustments to her discretionary spending.

H’s Needs

148.  Reference is made to paragraph 133 above, H’s general and personal expenses total $63,260. With his rent-free accommodation at the NY Property, my assessment of his earning capacity and the financial resource from D, he appears to be perfectly able to have his needs satisfied. He says that he is close to retirement age, and his counsel submits as follows:

“… However, given his age and it is now difficult for him to pick up again from the US market (not to say the general market condition for the time being), it can be envisaged that in future H will be able to earn a lot from his original trade and business.”

149.  Strict reading of this submission further supports my statement above, it is my finding that H’s future needs can be and will be satisfied with his own resources.

E’s Needs

150.  It is a well-recognized principle that where both parents have income and earning capacity, as in the case here, there should be a proportional / equal sharing of the expenses of the children. In normal situations and in the case of one child as here, this would be a ¼ share of the general expenses of the household of the care and control parent, and ½ of the children’s expenses. W produces the following numbers for the Children’s needs, with the right-hand column showing H’s proposals.

	HK$ (W)	HK$ (H)
School Fees	33,802	34,010
Tutoring (being special tutor for E’s special needs)	7,200	0
Transport to School (including school bus)	3,000	1,500
Uncovered Medical / Dental	5,500	0 (cut off medicine for ADHD)
ECA	1,650	1,000 (E does not enjoy ECA after school)
Entertainment/ presents	9,000	500
Holidays	Each parent pays own	N/A
Clothings / Shoes School and Gym shoes	1,000    760	500    125
Insurance premia	3,526 (H pays)	H pays
Pocket money	1,000	1,000
Other transport	2,000	500
Uniform	400	200
Meals out of home	6,000	1,000
Phone Bill	185 (H pays)	H pays
Miscellaneous: School support Glasses frame, lens Grooming / personal care Neurological and developmental evaluation	2,900    250 2,700    700	0      50 250 +300          700
Items used to be paid by H directly: Laptop, handphone, vitamins and supplements Disney membership	500 + 300 + 257	H pays for laptop 0 for vitamins 112 for single entry to Disneyland
TOTAL	78,419   Excluding insurance premium, laptop and phone bill	41,747

151.  H says that he himself pays a total of $20,252.93 per month for E including holidays, travel, entertainment when E visits him, lunch and pocket money and $3,482.62 of insurance premium.

152.  In H’s open proposal, he has proposed to pay $3,500 as E’s maintenance. At the end of this trial, H has undertaken to provide interim maintenance to her at $12,500 per month pending the final decision of the Court.

153.  H has complained that W’s numbers are exaggerated, and that there was no documentary proof. So, other than agreeing to the school fees expense (at $34,010 per his counsel’s submission), H has invited the Court to downward adjusts these numbers on a broadbrush basis.

154.  In my observation of the numbers presented by W, I also take the view that some are excessive, in particular, entertainment, presents and meals out of home, these total $15,000. But even if I were to slash these items of expenses in half, this would still bring her calculation of E’s expense to $70,919.

155.  Given the fact that E is a special needs child, and H does not have care and control, and H may have a somewhat limited understanding of E’s daily challenges, including those at school (as he only spends holiday time with her); I find his challenges on E’s expenses with regard to tutoring, school support, ECA, medical needs, and even personal grooming and supplements to be rather harsh. These were not challenged under cross-examination. I accept, in particular, W’s explanation of these items due to E’s condition.

156.  But despite all these comments, W is only asking H to contribute $30,000 towards E’s expenses, believing that based on her case, H has the capacity to pay.

157.  It is worth noting, for completeness purpose, ¼ of W’s general expenses of $96,450 (as reduced by me) is $24,112. W’s calculation of ½ of children’s expense (as reduced by me) $70,919/2 = $35,459. The total of H’s share in this calculation would be $59,571.

158.  On H’s own case, ½ of his proposed children’s expenses is $41,747/2 = $20,873, adding this to his share of W’s general expenses, the total would be $44,985 ($20,873 + $24,112). While he would argue that he is already paying $20,252 per month towards E’s expenses, he has not produced any documentary proof except for the $400 phone bill.

159.  All things considered I am of the view that W’s ask of H to contribute $30,000 towards E’s expenses is more than reasonable. And given the analysis above, H does have the ability to pay this amount given his income and financial resources.

Other factors taken into account

Parties living standard

160.  W has stated that their monthly expenses was around $100,000 during the marriage, which H denies.

161.  W says rent alone is around $50,000 (which accords with H’s breakdown of payment made by D on his behalf for rent in HK). H agrees to have paid $20,000 per month to W, he also paid for domestic helper directly ($8,000 per month), E’s private health insurance ($3,500 per month), and various expenses in his credit card analysed above. Despite H saying that he paid for these expenses (except for rent) only when in HK, the analysis from W’s table aforementioned shows a high standard of living closer to W’s version of events.

H’s complaint about W’s disclosure

162.  H complains about W’s late disclosure, including W’s allegation of promissory note signed with her father (produced 5 days before trial), unredacted bank accounts statements from October 2024 to trial (produced 5 days before trial); W’s Manulife account statements (produced 8 days before trial).

163.  H’s counsel further alleges in his closing submission that W’s last-minute disclosure put him in a difficult position to verify the documents and to assess her financial condition. H quotes that W has fallen short of her ongoing duty to provide disclosure despite legally represented.

164.  It must clearly be borne in mind that H had only decided to step back into the financial aspect of these proceedings less than two months before the hearing, and after a hiatus of more than 15 months during which he ignored Court orders and all the requests from W to discuss valuation of assets; and having been given chances to respond at least twice to the asset and liability schedule prepared by W’s solicitors, he has failed to comply. He then subsequently and at the last minute raises a number of objections to W’s case.

165.  Having disengaged himself for so long and not provided financial information himself and therefore failing his on-going duty of disclosure (which is incumbent whether or not he is legally represented), it lies ill in his mouth to then complain of W’s late disclosure. I also notice the W’s legal team has moved quickly to provide information and arranged for valuation ahead of the hearing dates despite the tight timeframe.

166.  I am also reminded that when H’s solicitors stepped in, they had even proposed that the trial be rescheduled to enable parties to value their assets properly. This suggestion means that the trial will be derailed and the milestone date be moved based on H’s own selective timetable of engagement.

167.  I find the H’s whole approach and conduct to be grossly unfair and disingenuous.

H’s conduct

168.  Reference is to be made to the points above regarding H’s absence in these proceedings, including the physical attendance at trial; and my finding that his disclosure with regard to his income and the extent of his financial resources leaves little to be desired.

Application of the Sharing Principle and departure from equality

169.  The only issue that the parties are in agreement is that there should be an equal sharing of the matrimonial pot, neither party has made any submission on the need to depart from equality; appropriate adjustments to the pension and MPF have been made.

Deciding the Outcome

170.  Referring to paragraph 129 above, the amount of the matrimonial pot is therefore $11,068,198.

171.  I agree that there should be a 50-50 split of the matrimonial assets. 50% of the matrimonial pot is $5,534,099. The equalising sum to be paid by H to W is therefore $5,827,841 on a clean break basis. H has liquidity in his pension account if he chooses to deploy funds therefrom.

172.  H is to pay $30,000 per month as maintenance for E, as maintenance to her has been ceased / unilaterally reduced since August 2023, this amount shall be back dated to August 2023, with due credit to any amount H has made to W from then towards E’s maintenance.

173.  H has stated in his own affidavit that he is paying for the medical insurance, phone bills and laptop, this is accepted as undertakings from him.

174.  Relying on the above cited Moher v Moher, and faced with the H’s conduct and my finding of non-disclosure on his part, I am entitled to “infer that the resources are sufficient or such that the proposed award does represent a fair outcome.” I am of the view that this is a fair outcome to W for her ancillary relief claim and for E’s maintenance; and that H has the ability to pay for these amounts.

Costs

175.  Costs should follow the event. H has actually asked for W to transfer capital sum to him. While W has over-estimated H’s pension amount to be placed into the matrimonial pot, by and large she has proven her case, and she has been successful in her claim.

176.  For the record, I have taken H’s conduct into account.

177.  There shall be a Costs Order in W’s favour.

Orders

178.  H’s position is that he will be continuing to pay for E’s medical insurance premium, laptop and mobile phone bill, and I shall accept this as an undertaking on his part.

179.  For the reasons aforesaid, I make the following Orders:

a.  The Respondent husband shall pay a lump sum of $5,827,841 to Petitioner wife within 3 months after Decree Absolute.

b.  The Respondent Husband is to pay $30,000 per month as maintenance for E, this amount shall be back-dated to August 2023, with due credit to any amount H has made to W from then towards E’s maintenance; until E reaches the age of 18 or completes full time education, whichever is later.

c.  Costs of these proceedings, including all costs reserved, be to the W, to be taxed if not agreed, with certificates for counsels. This to be a Costs Order nisi to be made absolute 21 days hereof.

d.  Section 18 Declaration to be issued.

1. With regard to the values referenced in this Judgment, digits after decimals have been omitted.

2. Exchange rate with USD is either 7.75 or 7.8 depending on the evidence or submissions.