S v. T

FCMC 1856 / 1998

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 1856 OF 1998

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J U D G M E N T

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1. This case relates to an application for ancillary relief by the Respondent Wife against the Petitioner Husband; for the purposes of this Judgment I will refer to the parties as Husband and Wife.

Background

2. The parties were married in Hong Kong on the 5^th February 1980 having previously registered their marriage on the 20^th February 1975 in the Mainland.  There are four children of the marriage all of whom have now obtained their majority.  The youngest child was admitted to Tai Po Psychiatric Hospital in May 2005.

3. The Petition was filed on the 25^th of February 1998 over 7 years ago.  At that time the Husband was represented by solicitors, whereas in respect of this application he appears in person and the Wife is represented by solicitors with the benefit of a legal aid certificate.

4. The Petition was based on two years separation alleging that the parties had lived separate and apart since the 29^th February 1992.

5. In May 1998 the Husband applied to discontinue the cause.

6. On the 17^th of May 2001 the Wife filed an Answer and Cross Petition alleging that the parties had lived separate part since about November 1991.

7. On the 6^th December 2001 a defended divorce was listed for half a day and a decree nisi of divorce was pronounced on the cross petition and the petition was dismissed.  There was no order as to costs save that the Wife’s costs were to be taxed in accordance with Legal Aid Regulations.  From the Court file it is apparent that this hearing lasted 20 minutes.

8. On the 22^nd of May 2002 an order was made as to the listing of the ancillary relief application for a half day with directions as to the filing of affirmations.

9. On the 28^th of July 2005 the ancillary relief application was listed for the 21^st December 2005; the matter was part heard on that day and was then completed on the 30^th of December 2005.

The circumstances of the Parties

10. Both the Husband and Wife filed a number of affirmations of means in the proceedings.  When the case started on the 21^st of December 2005 the most up-to-date affirmation of the Wife was dated the 13^th of December 2005 whereas the most up-to-date affirmation of the Husband was the 11^th of April 2002.In the circumstances the Husband was given leave to file an updating affirmation of means which was filed on 28^th December 2005.

11. The Wife is now aged 53.  She worked during the marriage as well as looking after the children.  She moved out of the matrimonial home in 1991 but maintained contact with the children and continued to contribute to their welfare.  As an illustration of this the elder child of the family moved to live with the Wife in 1998.  Since 1995 until July 2005 the Wife was employed as a janitor at a secondary school, her monthly salary was approximately HK$9,660.  In anticipation that she would be made redundant she resigned in July 2005 and received a lump sum pension of HK$136,546.10.  The Wife is currently living off this pension; although she is looking for further employment, she is not confident of success.  In the event that she is able to find employment the anticipated range of her potential income is between HK$4-5,000 per month.

12. The Wife lives in rented accommodation, the current rent being HK$3,640 per month; the Wife’s additional monthly expenses bring her total monthly expenses to HK$7,278.

13. Save for the above the Wife has no other assets of substance.

14. A matter of concern to the Wife is that in 1984 the Wife’s Mother was the original registered tenant of the public housing unit in Tai Po (“the Unit”) which is now occupied by the Husband.  In 1984 at the request of the Husband the Wife added the Husband’s Mother as an occupant of the Unit.  When the Wife’s Mother died in November 1995 the Husband’s Mother became the registered tenant.

15. The Husband is now aged 63 and lives in the Unit.

16. It is the Husband’s case that when his Mother dies he will be required to vacate the Unit.  The Husband’s Mother, who is in her 90’s, is mainly supported by the Comprehensive Social Security Assistance Scheme (CSSA) and is now living in a nursing home.  The CSSA does not cover all the expenses of the Husband’s mother with a result that the Husband contributes $600 per month towards his mother’s expenses.

17. The Husband is employed in a laundry and his current salary is HK$6,000 per month (previously approximately HK$9,000); his current expenses are approximately HK$9,900 per month (previously HK$12,402).  For much of the marriage the Husband was employed as a laundry worker at sea on various ships and therefore by reason of his employment was not a home.

18. The Husband’s bank accounts stand at approximately HK$6,000 and his Mandatory Provident Fund at HK$22,431.

19. The Husband owns a property in Tai Po (“the Property”).  The Property was purchased by the Husband in 1985/1986 for HK$200,500 with a mortgage of HK$120,000.  This mortgage was redeemed in May 1994.  The Husband mortgaged the Property on two further occasions in 1997 and 1999, when he was in debt and or out of work.  The current outstanding mortgage is HK$41,000.  According to the valuation of Messrs RHL Appraisal Ltd, the Property has a gross value of HK$680,000.

20. The Property is currently let, the tenancy expiring sometime in 2006.  The rental income is HK$3,300 per month and the mortgage instalments are HK1,881 per month.

21. It is the future of the Property that is now the main issue between the parties.

The Trial

22. Both parties gave oral evidence and were cross examined.

23. The Husband’s cross examination of the Wife focused on the following points :

a)   Various alleged transfers/gifts of money to the Wife from the Husband in the combined sum of approximately US$4,200 between 1986 and 1992.

b)   3,000 Town Gas shares allegedly given by the Husband to the Wife in 1989.

c)   challenge to the Wife’s evidence that she contributed HK$5,000 to the purchase of the Property.

d)   the Wife’s lack of contribution to the family as a whole either in monetary terms or otherwise, the Husband’s case being that his mother looked after the home and the children particularly after the Wife moved out in 1991.

24. The cross-examination of the Husband mainly focused on the following points :

          a)   the Husband’s failure to properly maintain the Wife.

b)   that on occasions when the Husband said he was unemployed he was in fact working.  The Husband accepted that in 1998 he did receive certain payments as reflected in his bank statements, these were from casual work rather than permanent employment.

c)   the necessity for the loans taken out by the Husband in 1997 and 1999.

25. Having heard and seen the parties I find that  they each gave their evidence to the best of their recollection and belief.  The differences in the main arose by virtue of the differing perspective from which each party viewed and recollected the past and the fact that it is now some 7 years since the proceedings were commenced.

Final submissions

26. In his final submission the Husband accepted that the Property should be sold.  He asked that the sale should not take place until the end of 2008 by which time he hoped to have repaid the mortgage.  In addition to which he believes that the Housing Authority will process his application for a housing unit more quickly once he is 65.

27. He accepted that his Wife should receive some “compensation” which he put at 30% of the proceeds of the Property.

28. The Wife sought a clean break and a division of the sale proceeds of the Property which should be sold as soon as possible.  Miss Go on behalf of the Wife proposed a split of 60 / 40% in favour of the Wife bearing in mind in particular the Husband’s failure to maintain the Wife in the past and the manner in which he had mortgaged the Property.

29. In addition to which the rent of the Property should be divided in a similar percentage namely 60 / 40 in favour of the Wife.

30. Miss Go helpfully identified the significance of the legal aid charge; the Wife’s costs are approximately HK$50,000 for the defended divorce and HK$80,000 for the ancillary relief making a total of HK$130,000.

31. The net equity of the Property is approximately HK$640,000, therefore after taking in to account the estimated costs of HK$130,000 the resources available for distribution are a little in excess of HK$500,000.

The Law

32. The application for ancillary relief falls to be determined by reference to section 7 of the Matrimonial Proceedings and Property Ordinance, particular paragraphs of which are of notable significance in this case.

Contribution

33. It is the Husband’s case that the Wife made little or no contribution to the family particularly after she left the home in 1991.  Having heard the parties give evidence and having read their affirmations I find that the Wife made a substantial contribution to the family not only in looking after the children but also by supplementing the family income through her earnings.  Although she left the matrimonial home in 1991 she has continued her role as responsible parent.

34. As the Wife mentioned in cross-examination the Husband could hardly know how she was contributing bearing in mind his absences from the home when he was at sea.

35. As to the Husband’s firm statement that he provided support to the Wife in the late 80’s early 90’s and gave her shares in Town Gas these do not in my view dilute the Wife’s substantial contribution or enhance a division of resources in favour of the Husband; they are but one of the myriad of matters to be weighed in the balance.

36. Equally I find that the Husband has made a substantial contribution to the family not only in terms of his paid employment but also in regard to his general contribution to the family.

Duration of the marriage

37. The Decree Absolute of Divorce has yet to be pronounced.  Although it was not raised specifically by the Husband, argument could have been deployed on his behalf that although this is a 30 year marriage the parties ceased to live together in 1991 / 1992 and therefore the court should take this fact into account when exercising its discretion under section 7 of the MPPO.

38. Notwithstanding this I am mindful of the Wife’s contribution to the family after 1991 and that according to her expenses she still contributes to the youngest daughter’s support while she is now Tai Po Psychiatric Hospital.  I therefore consider that in terms of Section 7 this is to be considered a long marriage which least, in law, continues until the present time.

Conduct

39. In her final submissions on half of the Wife Ms Go invites the Court to take into account the Husband’s conduct, in particular the mortgaging of the Property in 1997 and 1999, the Husband’s failure to maintain the Wife, his failure to proceed with the divorce and his subsequent Answer to the Wife’s Cross Petition resulting in an additional legal costs.

40. It is unfortunate to say the least that in a case where both parties recognised that the marriage had broken down and when they had been separated since either 1991 or 1992 that a defended divorce should have been a feature of the case, notwithstanding that it was ultimately compromised.  This has had the result of increasing the costs and the time taken for this case to be finally determined.

41. Equally notwithstanding the fact that directions were given as to the listing of the ancillary relief in May 2002 the matter was not set down until July 2005.

42. As to the criticism of the Husband’s mortgaging the Property in 1997 and 1999 the mortgage has been significantly reduced.

43. In the circumstances I do not find the Husband’s conduct has been such that an adjustment should be made to the award of ancillary relief.

Conclusion

44. Having regard to the particular factors of section 7, taking into account all the circumstances of the case, having heard the parties and having read their affirmations I find that the appropriate distribution of the capital resource of substance namely the Property is that of equality.

45. I am mindful however of the legal aid charge which will have a significant impact on the net amount of money each party will receive.  The husband is in person although he was previously represented by solicitors and counsel, I do not have the details of his legal costs.  The Wife is legally aided and her costs are approximately HK$130,000.

46. Rather than making an award of costs against the Husband which in all likelihood would cause further costs to be incurred by way of taxation I propose that the Wife’s own costs (in the approximate sum of HK$130,000) as the Legal Aid Charge be deducted from the net proceeds of sale of the Property (being the gross proceeds of sale, less the outstanding mortgage in the sum of HK$41,000 and the costs of sale) and that thereafter the proceeds of sale be divided equally between the parties.

47. So far as the timing of the sale I direct that this should be as soon as possible after the current tenant vacates the Property and that pending the sale, the rental income of the Property be divided equally between the parties after payment of the monthly mortgage instalment of HK$1,881 per month.

48. The orders of the Court are therefore :

1.   The Property be sold.

2.   Pending sale the rental income be divided equally between the parties after payment of the mortgage instalments.

3.   Upon the sale the net proceeds of sale being the gross sale price less

                 (i)   the then outstanding mortgage

                 (ii)  the costs of sale

                 (iii) the Director of Legal Aid charge

                 be divided equally between the Petitioner and Respondent

4.   No order as to costs save that the Respondent’s own costs be taxed in accordance with the legal aid regulations, such costs being a deduction of the gross proceeds of sale as referred to in paragraph 3 above.

          5.   Liberty to apply.