LYC v. CKY

FCMC 11384 /2021

[2025] HKFC 91

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 11384 OF 2021

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JUDGMENT
( Ancillary relief )

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1.  This is the ancillary relief trial of the petitioner wife’s claim for ancillary relief for herself and the only child of the family, namely a son born in 2010. In her written open offer lodged for the purpose of this trial, she asks that the matrimonial home be transferred to her and that the respondent husband shall pay her a sum of $3,000 per month for the benefit of their son.

2.  The husband is absent throughout the proceedings and in this trial.

Background

3.  The husband was born in 1966 and is now 58 years old. The wife was born in 1978 and is now 47.

4.  Through the assistance of a match-maker, the parties married in 1999 in China. At that time, the husband was already a Hong Kong citizen; the wife was a PRC citizen. After their marriage, the wife came to Hong Kong on visitor’s visa(s) from time to time.

5.  In 2002, the husband purchased a public housing unit at Lee Cheng Uk Estate in his sole name, which then became the matrimonial home of the parties (“matrimonial home”). Currently, it is the home of the wife and the son. The matrimonial home is already free from mortgage. Its current value is $2.6 million (open market value under the Tenants Purchase Scheme), or $1.2 million (secondary market value under the Tenants Purchase Scheme).[1]

6.  The wife obtained a single way permit to relocate to Hong Kong in 2005. She took up a job to work in a frozen meat shop at $6,500 per month. The husband worked as a warehouse worker at $15,000 per month.

7.  In 2008, the husband purchased another property in Qingyuan City (清遠市) (“PRC property”) with the financial assistance of RMB100,000 from the husband’s foster mother. Since its purchase, the PRC property has been occupied by the wife’s parents, with one bedroom reserved for the use of the husband and the wife when they travel to China. The current value of the PRC property is RMB290,000.[2]

8.  As said, their only son was born in July 2010. At first, he lived with the wife’s parents in China. He came back to live and started schooling in Hong Kong in 2013. He is now 14 years old and studying Form 2. The wife quitted her job to take care of him in 2013. She worked again since 2016, save and except 2018 to April 2019 when she had a herniated intervertebral disc.

9.  In May 2019, she found out that the husband had an extra-marital relationship with another woman. In July 2020, he left the matrimonial home without her prior notice and did not return since then. The parties thus separated.

10.  The wife filed her petition for divorce in November 2021, relying on the behaviour of the husband making it unreasonable to expect her to continue to live with him. Decree nisi was granted on 22 May 2024, by which time the marriage had lasted for 25 years.

11.  By an order made on 1 February 2024, the wife is granted custody, care and control of the son, and the husband has reasonable access.

Absence of the husband

12.  Since the husband left the matrimonial home, the wife has lost contact with him. He did not leave his address to her. He did not pick her phone calls. His immediate family, namely his foster parents, had already passed away. She no longer has the means to locate or contact the match-maker.[3]

13.  The wife even told in her oral evidence that in the beginning when the husband left the matrimonial home, the son had tried to send WeChat messages to the husband, but the husband simply blocked the son’s messages.

14.  On 28 June 2023, a deputy judge of the family court made an order that the petition and accompanying documents shall be served on the husband by way of substituted service, ie by an advertisement in a newspaper. The wife duly complied with the order.

15.  I first had seizure of the ancillary relief matters in the case management hearing of 29 May 2024. Directions were given by me for the husband to file his Form E, and for the parties to file their narrative affirmations on section 7 of the Matrimonial Proceedings and Property Ordinance, Cap 192 (“MPPO”). I dispensed with the financial dispute resolution hearing and fixed the case for final ancillary relief trial. Further, I directed that this case management order shall be served on the husband by substituted service, ie an advertisement in the same newspaper.

16.  An affirmation of service was filed on 2 April 2025 showing that the case management order was duly served according to the directions of the court.

17.  Thus far, the husband was absent in all hearings before the court. He has not filed any Form E or narrative affirmation.

18.  I regard that the husband has been duly notified of the trial. He chose not to engage in the case. I see no reason why the trial should not be proceeded in his absence.

Applicable Law

19.  Section 7 of the MPPO sets out the matters that the court must have regard to when making orders for ancillary relief for a spouse and any child of the family:

“ (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.

(2) Without prejudice to subsection (3), it shall be the duty of the court in deciding whether to exercise its powers under section 5, 6 or 6A in relation to a child of the family and, if so, in what manner, to have regard to all the circumstances of the case including the following matters, that is to say—

(a) the financial needs of the child;

(b) the income, earning capacity (if any), property and other financial resources of the child;

(c) any physical or mental disability of the child;

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

(e) the manner in which he was being and in which the parties to the marriage expected him to be educated;

and so to exercise those powers as to place the child, so far as it is practicable and, having regard to the considerations mentioned in relation to the parties to the marriage in paragraphs (a) and (b) of subsection (1), just to do so, in the financial position in which the child would have been if the marriage had not broken down and each of those parties had properly discharged his or her financial obligations and responsibilities towards him.”

20.  The Court of Final Appeal in its landmark judgment of LKW v DD [2010] 13 HKCFAR 537 has enunciated 4 guiding principles as to how section 7 of the MPPO should be approached, namely (i) objective of fairness, (ii) rejection of sex or role discrimination, (iii) yardstick of equal division, and (iv) rejection of minute retrospective investigation.

21.  It has further laid down 5-step approach as follows:

(1)  to ascertain the financial resources of each of the parties calculated as at the date of the hearing;

(2)  to assess the financial needs of the parties;

(3)  to apply the sharing principle to the parties’ total assets (if surplus assets would remain after the parties’ needs have been catered for);

(4)  to consider whether there is/are good reasons for departing from the principle of equal division;

(5)  to decide the outcome.

Identification of assets

22.  In the following discussion on the value of the parties’ assets, I shall round up the figures to the last decimal for easy discussion.

23.  According to the evidence from the wife, her assets consist mainly of the cash at bank(s), mandatory provident fund (MPF) and cash value of 2 insurance policies. The total sum of her assets is about $470,522.

24.  Since the husband has not filed any Form E or narrative affirmation, the court is not able to ascertain the true and accurate position of his assets. But it is indisputable that the matrimonial home and the PRC property are both registered in his sole name.

25.  While giving oral evidence in the court, the wife mentioned that the husband must have MPF but she did not know the exact amount because he had not filed his Form E.

26.  Despite such oral evidence of the wife, Ms Vivian Lam, counsel for the wife, submitted at the beginning of her closing submission that apart from the matrimonial home and the PRC property, the husband did not have any substantial and important assets. When the court reminded counsel of the wife’s oral evidence and brought counsel’s attention to a series of cases decided by the family court on the illiquidity nature of the MPF, counsel then made the following additional closing submission:

(1)  Under the MPF scheme which came into force in 2000, the employer and the employee each has to pay 5% of the monthly income of the employee as their respective contribution to the MPF of that employee;

(2)  The husband worked as a warehouse worker at least since 2003. At first, his income was $15,000 per month. He changed to work for another employer at an increased income of $18,000 per month in 2011;

(3)  Hence, his MPF from 2003 to first half of 2025 should be $435,600;[4]

(4)  The wife acknowledges the illiquidity nature of their respective MPF and seeks to argue that the current face value of her MPF should be discounted for 40%, whereas the current value of the husband’s MPF should be given a discount of 30%.

27.  In my view, the overall evidence of the wife shows that although she worked from time to time after she was relocated to Hong Kong, it was the husband who had been the main breadwinner of the family. I have no reason to doubt such evidence. Further, subject to my observation that Ms Lam should not have calculated the husband’s MPF amount up to June 2025, but only up to the date of the trial as remarked by the Court of Final Appeal in LKW (supra), I accept counsel’s closing submission as to the computation of the husband’s likely amount of his MPF set out at (1) to (3) in the preceding paragraph. Notably, the husband had worked longer in terms of duration than the wife. The computation of the likely total amount of MPF suggested by Ms Lam looks reasonable and logical. This is also the best evidence that this court may have in this trial. Hence, I conclude that the likely amount of the husband’s MPF as at the date of trial would roughly be $433,800.[5]

28.  The illiquidity nature of MPF is discussed by the family court from time and time. Some of the more oft-quoted cases are:

(1)  DGB v SDGK, FCMC 12078/2013, date of judgment 12 March 2014 by HHJ Ivan Wong, where the husband was 47 years old and the learnt judge gave a discount of 40% on the face value of his MPF;

(2)  SSLT v SMFC, FCMC 11056/2017, [2019] HKFC 250 by HHJ Ivan Wong, where the learnt judge gave a discount of 50% of the pensions and retirement accounts of the husband (aged 43 at the time of trial);

(3)  LWF v WST, FCMC 5380/2019, [2021] HKFC 164, a judgment from this court in which I discounted the current face value of the MPF of the wife (aged 54 at the time of the trial) by 30%.

29.  As at this trial, the husband of this case is 58 years old. The wife is 47 years old. Having considered the above authorities and the circumstances of this case, I agree to give:

(1)  a discount of 40% to the current face value of the wife’s MPF, which means that $109,878 would be counted into the family pot;[6]

(2)  a discount of 30% to the current value of the husband’s MPF, which means that $303,660 would be put into the family pot.[7]

30.  Due to the above findings but without the benefit of the husband’s Form E, the parties’ assets at least come up to $2,213,261 as follows:

	Wife	Husband
Cash at banks	$10,531	---
Policies	$276,862	---
MPF	$109,878	$303,660
Matrimonial home (secondary market value)	---	1,200,000
PRC property	---	312,330[8]
Total:	$397,271	$1,815,990

The wife’s financial means & reasonable needs

31.  The wife is now 47 years old and is employed as a patient assistant with the Hospital Authority at $18,181 per month. Although she says that she once had a herniated intervertebral disc, there is no medical evidence to prove that her future earning capacity would be affected. She agrees that her present job is doing fine. I shall rule that it is more likely than not that she is able to continue with this job until her retirement at the age of 65.

32.  Her monthly expenses as updated in her narrative affirmation (dated 14 March 2025) and further clarified by her oral evidence are like these:

General expenses:	$6,200
Personal expenses:	$4,800[9]
Son’s expenses:	$4,850
Total:	$15,850

33.  I am of the view that the above expenses are reasonable and correctly reflect the living standard of this family during the marriage, which was an ordinary working class standard. However and importantly, the above monthly expenses do not cover their accommodation expenses, because they are living at the matrimonial home which is free from any mortgage.

34.  According to the wife’s oral evidence, if they were not able to continue to live at the matrimonial home, they would need to rent another flat of similar size in the same area of Shamshuipo. The rental costs would at least be $5,000 to $6,000 per month.

35.  It is sufficiently clear to me that if the wife and the son have a roof (which is free of rental) to live in, her monthly income would be sufficient to cover the monthly expenses of her and of the son. Otherwise, their total monthly expenses, including rental costs, would be increased to $20,850 to $21,850, in which case she would not be able to make her ends meet. Such housing needs will have to be taken into account by the court.

The husband’s financial means & reasonable needs

36.  As said, the husband has not filed any Form E or narrative affirmation. However, the wife is able to provide some information of him as follows:

(1)  He was born in 1966 and is now 58;

(2)  When he was still very young, he was adopted by another couple because his natural parents were unable to raise him financially. His foster parents and natural parents had all passed away;

(3)  Since 2003, the husband worked as a warehouse worker, earning about $15,000 per month. In 2011, he changed his job to work as a warehouse worker for another employer, at an increased income of $18,000 per month. He would give all his wages (after paying the mortgage repayment which was about $900 per month at that time) to the wife who in return would give him $4,000 per month for his own spending;

(4)  However, he left the matrimonial home in July 2020, after the wife found out that he had an affair with a lady. Since then, he has not paid the wife any money. She has no idea of his current job or his actual income.

37.  I have no reason to doubt the above evidence of the wife. From such evidence, I am satisfied that the husband should have good working ability; otherwise, he would not have been able to stay with the same job for 8 years (from 2003 to 2010), after which he was able to get a similar job but at a higher pay in 2011 (from $15,000 to $18,000). I deem that his monthly income way forward is at least $18,000 per month.

38.  I have already made findings on the likely amount of his MPF and will not seek to repeat myself.

39.  There is no direct evidence from the husband on his monthly expenses. However, the fact that he was paid back $4,000 per month by the wife from his wages suggests that he led a rather frugal life style. I shall take a broad brush approach to say that his monthly income would be sufficient to take care of his future needs, including his housing needs.

Departing factor & deciding the outcome

40.  The parties of this case were married in 1999 and separated in 2020. It is a long marriage of about 25 years (up to the grant of decree nisi), during which both of them contributed to the family.

41.  They have a son (now about 14 years old) whose custody, care and control rests with the wife. Since the husband left the matrimonial home in 2020 without any prior notice to the wife, the responsibility of raising the son has fallen onto the shoulders of the wife. While it is true that both parties have earning capacity and thus have the responsibility to give financial support to the son until he reaches his majority, it is clear from the facts of this case that it would not be practicable for the court to order the husband to pay monthly maintenance to the wife for the benefit of the son, because it is not feasible for her to locate him.

42.  The husband has not engaged in these proceedings. He has not filed his Form E or narrative affirmation. However, the court accept the evidence of the wife and find that his monthly income should be at least $18,000 per month which is sufficient to cover his expenses way forward, including his housing needs.

43.  Currently, the wife has a stable job with the Hospital Authority earning slightly over $18,000 per month. If she and the son are able to continue to live in the matrimonial home, her income would be sufficient to support herself and the son way forward. Otherwise, her income is not sufficient to allow her to move out of the matrimonial home and rent a private flat with the son. Their housing needs have to be catered for.

44.  In LKW (supra), the Court of Final Appeal explained that “financial needs” may be a factor leading to a departure from the equality of division of assets, and had these to say:

“74. ...Addressing the needs of say, the wife and children may immediately absorb more than half of the total assets. If so, “needs” are, for want of any alternative, determinative….

75. The position is neatly summarised by Sir Mark Potter P in Charman v Charman (No 4) as follows:

‘... when the result suggested by the needs principle is an award of property greater than the result suggested by the sharing principle, the former result should in principle prevail: per Baroness Hale in Miller at [142] and [144]. ... It is also clear that, when the result suggested by the needs principle is an award of property less than the result suggested by the sharing principle, the latter result should in principle prevail: per Lord Nicholls in Miller at [28] and [29] and Baroness Hale at [139].’”

45.  Due to the above findings and in the circumstances of this case, I come to the conclusion that the housing needs of the son and the wife, and her financial obligations way forward of taking up the sole responsibility of raising the son since the husband has literally deserted the family since 2020, is a factor for departing from the equal-sharing principle. Fairness dictates that the matrimonial home should be transferred to her, so that she and the son can continue to live there.

46.  Further, it is my view such status quo housing arrangement would give a sense of stability and security to the son, which in turn is in his best interest.

47.  Apart from that, I opine that each party shall retain their other assets, including that the husband may retain the PRC property.

48.  Roughly, the above ruling would mean that the wife would get, including her own assets, about 72% of the total assets[10], and the husband would have the remaining 28%.

Costs

49.  Ms Lam for the wife asks for costs of the ancillary relief matters, including the trial.

50.  Although the husband has not engaged in these proceedings, it remains true that the wife’s initial open offer cannot beat the outcome of this judgment. Her revised offer comes out rather late, and only during her oral evidence. Further, she fails to set out her case on the husband’s MPF in her narrative affirmation and thus her opening submission. Her case on his MPF emerges, for the first time, during her oral evidence in the trial only. Time has to be given, on the request of her legal team, for preparing further oral closing submission on the husband’s MPF.

51.  Additionally, despite that it is very clear that the wife would not be able to locate the husband for the execution of the conveyancing documents to transfer the matrimonial home to her, her written opening or closing submission has not proposed any suggestion as to how to deal with this matter, with the hope to save costs and time.

52.  I therefore conclude that a “no costs order” is more appropriate in this case.

Conclusion

53.  Due to the matters set out aforesaid, I therefore will make the following order:

(1)  All of the husband’s rights and interests in the matrimonial home (full address be inserted into the court order for approval) shall be transferred to the wife at nil consideration within 3 months from the date of the grant of the decree absolute, or within 3 months from the consent to the transfer given by the Housing Department or Housing Authority (as the case may be), whichever is the later. The transfer costs shall be borne by the wife;

(2)  A person shall be appointed by the court to execute the conveyance, contract or other documents on behalf of the husband pursuant to section 38A of the District Court Ordinance, Cap 336. The wife shall nominate such a person to the court within 35 days thereof in writing;

(3)  The husband shall retain and keep the PRC property (full address be inserted into the court order for approval);

(4)  Upon the grant of the decree absolute, all other ancillary relief claims between the parties, if any, do stand dismissed;

(5)  There be no order as to costs of the ancillary relief proceedings, including all costs reserved and this trial, to be taxed if not agreed; certificate for counsel is granted;

(6)  The wife’s own costs shall be taxed in accordance with the Legal Aid Regulations;

(7)  This order shall be drawn up by the wife in Chinese.

54.  I grant the declaration under section 18 of the MPPO.