CCMJ v. SSM formerly known as SKL

FCMP 67 /2010

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 67 OF 2010

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D E C I S I O N
(Discharge/Modification of Undertakings)

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Introduction

1.  This is the call over hearing of the Applicant Father’s Summons dated 3 November 2015 seeking leave to withdraw from his Undertakings given to the Court and to the Respondent on 12 June 2014 (“the Undertakings”).  There is an alternative prayer in the Summons seeking ‘modification’ of the Undertakings.

2.  It is noted that the Undertakings were given on the 1^st day of a 7-day trial of the Mother’s claim for financial provisions for the child N against the Father.  Both the Father and Mother were represented by Counsel at the trial when the Undertakings were negotiated and concluded.

3.  This Court handed down its Judgment on 5 June 2015 in respect of the Mother’s claim for financial provisions.  The Father sought leave to appeal against the Judgment at this Court and, being unsuccessful, took the matter further to the Court of Appeal. The Father’s application for leave to appeal was dismissed by this Court on 12 August 2015.

4.  On 7 December 2015, the Court of Appeal also refused the Father’s application for leave to appeal (see HCMP No.2059 of 2015) and ordered him to pay Indemnity costs summarily assessed at HK$100,000.  The Mother’s own costs are to be taxed in accordance with Legal Aid Regulations.  The Court of Appeal opined the Father’s application is wholly unmeritorious (at paragraphs 14 to 18 of the Reasons for Judgment).

5.  At this hearing, the Father was represented by Counsel Miss Athena Wong, who also appeared for the Father at the hearing before the Court of Appeal in HCMP No.2059 of 2015.

The 2 Undertakings

6.  I shall set forth the terms of the 2 Undertakings given on 12 June 2014 which was embodied in a Court Order sealed and perfected on 16 July 2014 :-

“AND UPON the Applicant undertaking to the Respondent and to the Court that he shall pay for all the Minor’s school fees, school bus, school uniform, school books and stationery so long as they are reasonable and deemed necessary by the school with school books and stationery to be initially paid by the Respondent in respect of which she will be repaid on a reimbursement basis within 14 days from the Respondent’s production of receipts.

 AND UPON the Applicant undertaking to the Respondent and to the Court that he shall bear all reasonable costs of extra-curricular activities arranged by the Respondent provided that the total costs of such activities shall not exceed HK$4,000 per month, such costs to be initially paid by the Respondent in respect of which she will be repaid on a reimbursement basis within 14 days from the Respondent’s production of receipts.”

The Father’s Summons

7.  The terms of the Father’s Summons are, inter alia, as follows :-

“1.  The Applicant be granted leave to withdraw from the undertakings he gave to the Court and to the Respondent at the hearing on 12 June 2014 before Deputy District Judge G. Own (the “Undertakings”);

2.  Alternatively, the Undertakings be modified to the extent below :

a.  the Respondent shall present a list of all claimed expenses, that fall within the scope of the Undertakings, and all the original receipts of the claimed expenses to the Applicant’s solicitors on the last business day of every month (“the Reimbursement Request”);

b.  The Respondent undertakes to the Applicant and to the Court that she shall obtain the prior written consent of the Applicant for seeking reimbursement of any items or expenses falling outside the scope of the Undertakings; and

c.  The Applicant undertakes to the Respondent and to the Court to pay all expenses covered by the Undertakings within 14 days from the receipt of the Reimbursement Request.”

The Father’s supporting affirmation

8.  The Father’s 33^rd Affirmation (46 paragraphs) filed in support together with 13 exhibits (from “CCMK33-1 to CCMJ-13” altogether adding up to about 120 pages not including the exhibit sheets) divided into the following sub-headings :-

“A.  Reasons for this Application (paras 3 to 6);

B.  Undertaking given on the hearing on 12 June 2014 (paras 7 to 19);

C.  The Respondent’s Abuse of the Undertaking and Repeated Demands (paras 20 to 22);

D.  Effort to Resolve the Reimbursement Matters was Futile (paras 23 to 30);

E.  Threat from the Respondent’s solicitors (paras 31 to 39);

F.  Increased demands from the Respondent (paras 40 to 44);

G.  Relief Sought (paras 45 and 46).”

9.  Counsel Miss Athena Wong for the Father in her Speaking Notes referred to the case of Re Hudson [1966] 1 Ch. 209 and a passage extracted from the Common Law Library, Arlidge, Eady and Smith on Contempt, 4^th ed.   

The Mother’s stance

10.  The Mother was represented by Legal Aid assigned Counsel Mr. Kevin Li who appeared in the 7-day trial. Counsel in his Speaking Note submitted that the Father’s Summons should be dismissed even at this call over hearing before proceeding any further for failure to satisfy the relevant legal principles on the topic of Undertakings. At this hearing, Counsel confirmed no Affirmation in Opposition would be filed at this stage although the Father’s present application would be fully contested by the Mother.  In the event that this Court allows the Father’s Summons to be proceeded along, the Mother would be seeking directions for the filing of affirmation in opposition.

11.  Counsel Mr. Li in his Speaking Notes referred to 2 cases of the Family Court where applications relating to undertakings were considered.  The cases are L v. C (FCMC No.5952 of 2012) and TLS nee J v. RCS (FCMC No.1637 of 2012).  The latter case is a decision of this Court.

The relevant legal principles

12.  It is pertinent to note the difference between an order to do something and an undertaking embodied in an order to do the same thing.  Such difference was noted by Buckley J in the case of Re Hudson [1966] 1 Ch. 209 where the learned Judge went into detail as far as to differentiate  between undertakings to make payment of money and undertakings to perform or abstain from performance of an act other than payment of money . 

13.  Quoting from pages 213G to 214D of the judgment where the learned Judge said :-

“………..An undertaking, however, is not an order.  It is true that an undertaking to do or abstain from doing something other than payment of money may have the same effect as a mandatory or a restrictive injunction; for a breach of such an undertaking, like a breach of an injunction, expose the culprit to the risk of imprisonment or possibly of sequestration or a fine.  These are penal sanctions aimed at enforcing compliance with either a promise made to the court or an order of the court, as the case may be.  They are not remedies the purpose of which is to compensate some other party for damage he has suffered as the result of the breach or for recovering any property or enforcing any right of his.  In most cases, at any rate, an order to pay money is of a wholly different character and produces quite different results from an undertaking given to the court to pay something (my emphasis).  In the first place an order to pay money is most usually, though not always, a consequence of the person to be paid having established a right to payment of the sum in question.  The order having once been made, the court would not revoke or vary it.  Where, on the other hand, no order for payment has been made but an undertaking has been given to the court to make a payment, the court could at any time upon good cause being shown release or modify the obligations under the undertaking (my emphasis)…….…”

14.  It is clear from the judgment of Buckley J that where there was no court order to make payment but nevertheless a party has given an undertaking in the litigation process to make payment and such undertaking was embodied in a court order, it is only the obligations (myemphasis) embraced within the undertakings as opposed to the actual undertakings given could be released or modified upon good cause being shown.  

15.    As to application for the uplift of or release from performance of undertakings given, the legal position remains the same as set forth in L v. C (FCMC No.5952 of 2012) and TLS nee J v. RCS (FCMC No.1637 of 2012).  I am not assisted by the Father’s Counsel Miss Wong with any cases, authorities from any higher level of courts or jurisprudence, which I doubted there are any, where undertakings given of which, in most cases as in the present one, was clothed with an element of voluntariness, could be ‘modified’ although it could be uplifted or discharged in appropriate circumstances.  In TLS nee J v. RCS (supra) at paragraph 15 of the Reasons for Decision, 4 circumstances have been set out to support an uplift or discharge of undertakings, namely :-

“(a)  There has been a material change of circumstances since the undertakings were given which are not foreseeable at the time and which make compliance not feasible;

(b)  The subject matter to which the undertakings relate no longer exists which render compliance impossible;

(c)   The party to whom the undertakings were given releases the other party from complying with the undertakings;  

(d)   The undertakings were obtained through fraud or misrepresentation.”

16.  In L v. C (supra), the learned Deputy Judge Grace Chan at paragraph 22 of her Judgment, citing TLS nee J v. RCS (supra), said further :

“22.      Based on all the above cases and doing the best I can, I shall summarise the applicable legal principles as follows :-

(1)   An undertaking can be discharged, but not varied.  This is because the litigant is not ordered to give these undertakings; he chooses to give them : Cutler (supra);

(2)   The court has jurisdiction to discharge an undertaking given to the court at any stage, even if it was given in an order made by consent : Kensington Housing Trust (supra) and Mid Suffolk District Council (supra);

(3)   [Citing TLS nee J v. RCS (supra)……..]

(4)   Whether an undertaking given to the court should be discharged is a matter of judicial discretion to be exercised if it is ‘just’ to do so : Kensington Housing Trust (supra) at 613;

(5)   ………….”

17.  With these principles in mind, I now proceed to consider the Father’s application.

Discussion

18.  To start with, the reliefs sought by the Father are in the alternative, namely :-

(a)  To withdraw the Undertakings (paragraph 1 of the Summons); alternatively,

(b)  To ‘modify’ the Undertakings if not be able to withdraw the Undertakings (paragraph 2 of the Summons).

19.  The Father at paragraphs 3 to 6 of his 33^rd Affirmation (under sub-heading A: “Reasons for this Application”) referred to the Undertakings had been unfairly exploited or abused by the Respondent Mother.  Counsel Miss Wong for the Father further submitted, as I understand it, that the Mother had bombarded the Father’s email account with numerous demands for moneys of which not being covered by the terms of the Undertakings.  Such conduct was said to have amounted to a material change of circumstances which warranted the present application of the Father.

20.  Although reliance was placed by Counsel Miss Wong on Re Hudson (supra), it seems to me that she had misread the decision of Buckley J in failing to see that it was the obligations (my emphasis) which a party had undertook to perform could be released or modified rather than the undertaking to perform.  Quoting a day-to-day example would be that the obligation to pay (which a party had so undertaken) a sum of, say, $1000 could be modified either upwards or downwards to other amount of money.  However, such undertaking to pay could only be uplifted or discharged if one or more of the circumstances set out in TLS nee J v. RCS (supra) exists.

21.  This follows the next question as to whether, according to the matters raised by the Father in his supporting Affirmation, amounted to a material change of circumstances which was not foreseeable at the time when he gave the Undertakings and had rendered performance not feasible (TLS nee J v. RCS)  ? 

22.  Going through the Father’s supporting Affirmation, in particular, (sub-heading C: “The Respondent’s Abuse of the Undertaking and Repeated Demands”) and (sub-heading F: “Increased demands from the Respondent”), he is in essence complaining the Respondent’s repetitive demands through emails to his office email account for reimbursement of sums falling outside the terms of the Undertakings.  The Father also complained no original receipts were provided by the Mother since the receipts were needed for his tax purposes and also for verification as to whether the expenses are indeed related to the child in question.  There is also complaint by the Father that the Mother did not seek his consent or consult him prior to signing up for additional Extra Curricular Activities (“ECA”) classes.

23.  The Father in his Exhibit “CCMJ-33-4” and “CCMJ-33-5” produced the emails exchanged between himself and the Mother. I should perhaps say that since no Affirmation was filed by the Mother, I would assume the emails produced by the Father are complete.

24.  Considering the contents of the emails, it can be seen that the Mother had been repeatedly chasing him for reimbursement of expenses spent on the child.  Some receipts are produced by the Mother but whether it is complete had yet to be ascertained from the Mother, if necessary. In the email dated 13 October 2015, the Mother was chasing the Father 4 sums of moneys, namely, $1,637 which she had notified him on 1/9/2015 (outstanding 41 days); $3,500.30 which she had notified him on 7/9/2015 (outstanding 35 days); $350 which she had notified him on 16/9/2015 (outstanding 26 days) and $1,860 which she had notified him on 25/9/2015 (outstanding 18 days).  The total outstanding sum is $7,347.30.   

25.  It is not the Father’s case, to the very least not deposed to in his 33^rd Affirmation, that he had already settled the moneys requested for by the Mother but nevertheless the Mother kept on bombarding his office emails account.  Given the fact that there are sums long outstanding and unpaid, the Mother’s repeated requests for reimbursements could not be said to be unforeseeable or unreasonable so as to amount to unfair exploitation or abuse of the Undertakings.  Had there been any disagreement by the Father whether as to the expenses claimed by the Mother fall within the scope of the Undertakings or supporting receipts, it is for the Father to seek further directions from the Court if it could not be resolved amicably through respective lawyers.  There is so far no such application and the Father then come up with the present application for an outright withdrawal from the Undertakings as per paragraph 1 of the Summons.  This is not acceptable.

26.  As to the matters raised under (sub-heading B : “Undertaking given on the hearing on 12 June 2014”), it is superfluous to re-visit the circumstances as to how the Undertakings came about and given.  First of all, the Father was legally represented by experienced family law practitioners including experienced Counsel Mr. Jeremy Chan.  It is fair to say whatever contingencies that might arise in relation to the subject Undertakings would have been canvassed by and within the contemplation of his lawyers, if not the Father himself also.  Secondly, it is noted that the Father produced a copy of the Transcript of the hearing on 12 June 2014 with an attempt to elaborate or explain the meaning, scope and extent of the Undertakings in question.  In my view, such attempt is unscrupulous.  As said earlier, any dispute as to the meaning and scope of the Undertakings would be the subject of clarification by Court’s process rather than seeking outright withdrawal of the Undertakings.  Had the Court not been able to clarify or resolve the dispute without going through the transcript, it would then do so.  Thirdly and surprisingly, I fail to see how the Father could produce the Mother’s Counsel’s Opening Submission as his own documentary exhibit under Exhibit “CCMJ-33-3”.  This is, in my view, unscrupulous if not contrary to any professional rules, conduct and ethics. 

27.  As to the matters raised under (sub-heading D : “Effort to Resolve the Reimbursement Matters was Futile”), I do not see how those contacts between the respective law firms attempting resolution on reimbursement would have any relevance to become a ground to support the present application.

28.  As to the matters raised under (sub-heading E : “Threat from the Respondent’s solicitors”), which is again repeating the chain of correspondence exchange between the respective law firms.  Counsel Miss Athena Wong for the Father failed to address further as to what ‘threats’ had the Father been subjected to so much so that he could rely upon as his ground for the present application.  

29.  The Father had not been able to bring himself within any one or more of the circumstances set forth in TLS nee J v. RCS (supra) for withdrawal of the Undertakings.  The Father had also failed to demonstrate any legal basis that the Court could ‘modify’ Undertakings.

Retrieval/Qualifying the Undertakings

30.  It is not the first time that the Father attempted to retrieve from or qualify the Undertakings that he gave on 12 June 2014.  In this Court’s Judgment handed down on 5 June 2015 as to Financial Provisions, at paragraphs 145 to 150, upon the Father’s then Counsel’s submissions in arguing the financial provisions for the child N, this Court had already referred to the Order dated 12 June 2014 containing the Undertakings and had said :-

“145.  This Order embodied the Father’s 2 Undertakings and was drafted by the Mother’s solicitors ‘having the carriage of the order’ (see 42//5/4 of HKCP 2015), perfected and sealed on 16 July 2014.  There is no question that it had been duly served upon the Father’s lawyers.

146.  Since the Order has been perfected and sealed, it is trite that this Court is now functus officio on the terms therein (see Andayani v.             Chan Oi Ling [2000] 4 HKC 233).  If any party considers that an order not in accordance with the order as pronounced, he should apply to the court to vary the order as soon as possible so as to prevent the order from being passed and entered and made final (Re Swire (1885) 30 Ch.D, 239).

147.  In my decision, the terms of the Undertakings are clear in context and coverage, it refers to “all school fees, school bus, school uniform, school books and stationery…….” and “all reasonable costs of extra-curricular activities ……no exceed HK$4,000 per month….” without any reference or restrictions as to any period of time for it to apply, whether in prospective, that is to take effect from and since the date of the Undertakings, or retrospective, that is to also cover expenses before the date of the Undertakings.

148.  In my decision, the Father’s 2 Undertakings apply to expenses before and after the date when the Undertakings were given.  That is to say, they also covered those expenses under the Mother’s claim for reimbursements within the 62 months.  There are 2 reasons for this finding.  First, the Undertakings contained the word “all” which could not be taken to mean only expenses spent on and after the date of the Undertakings.  Secondly, the 12 June 2014 was the very first day of the trial of the Mother’s claim which included reimbursement of these expenses that had been spent within the 62 months prior to the trial. The 2 Undertakings were included (as drafted by the Mother’s lawyers) as pre-emptive clauses before the order for adjournment of the trial.  Without any express limitation as to the time period, this could not be taken to mean it only covers expenses spent on and after the date of the Undertakings but not before.

149.  It is my decision that the 2 sums of HK$83,626 for Extra-Curricular Activities expenses and HK$39,920 for School Bus (spent and incurred during the 62 months between May 2009 and June 2014) both fall within the terms of the Father’s 2 Undertakings given on 12 June 2014.  Accordingly, subject to the Father’s full compliance of the terms of his Undertakings, these 2 sums would have to be deducted from the sum of HK$239,850.60 (paragraph 143 above).

150.  The medical expenses of HK$23,836 for N fall outside the Father’s Undertakings.  Given the lapse of time since these expenses were incurred, they are now no longer recoverable from the Father’s employer’s medical insurance.  In Father’s Counsel’s written closing submissions on calculation of outstanding reimbursement figure, it was said that the Mother had belatedly provided the Father with documentary proof.  It is now too late to claim from medical insurers and the Father would have to pay from his own pocket (paragraph 48(3) of Counsel’s submissions). The Father’s Counsel, with this sum of HK$23,836 added in as money payable by the Father, then came up with the total sum of HK$89,477 as the total outstanding amount. The fact that the Father had not produced evidence on his assertion of the Mother belatedly gave him the receipts and the inclusion of such sum as part of the amount which need to be reimbursed, it is my decision that such medical expenses should not be deducted from the sum of HK$239,850.60 (paragraph 143 above).”

Cross Undertakings by the Mother ?

31.  Upon review of the alternative prayer in the Father’s Summons, it is odd and absurd for the Father to be able to impose terms (see paragraph 2(a) of the Summons) and cross undertakings (see paragraph 2(b) of the Summons) upon the Mother as condition precedent to his performance of the Undertakings that he gave. 

32.  Counsel Miss Athena Wong could not assist this Court further as to what legal basis or logic for the Father to be able to put forward such alternative prayer. 

Compliance with the Practice Directions

33.  Upon review of this case as a whole, it is noted that at least on 2 previous occasions that the Father, with the benefit of legal advice by experienced family law practitioners throughout, was found not to have complied with Practice Directions.  This is odd and unacceptable.

34.  At the trial in this Court back in 2012 when the Father was legally represented throughout the trial, he attempted to adduce medical expert evidence without compliance with Parts G and K of Practice Directions 15.12 and Order 38, Part IV on Expert Evidence (date of Judgment : 5 October 2012).

35.  In HCMP No.2050/2015 (date of Judgment : 7 December 2015) on the Father’s application for leave to appeal, Hon Poon JA commented the hearing bundles submitted were not in compliance with Section E of Practice Direction 4.1.  It also ignored the reminder sent by the Registrar of the High Court to the parties dated 27 August 2015 that the hearing bundle should only contain documents essential for disposal of the application for leave to appeal.  His Lordship at the concluding paragraph of the Judgment said :-

“26.  In the future, if the hearing bundles for leave application before the Court of Appeal do not satisfy the requirements in Practice Direction 4.1, this Court will simply return them without reading and direct the responsible party to prepare them in accordance with Practice Direction 4.1.  The Court may also visit the responsible party and his solicitors with costs sanctions.”

36.  In the present application, it is noted that the Father produced the Order dated 12 June 2014 as his documentary exhibit under Exhibit “CCMJ-33-1” to his 33^rd Affirmation.  This is, unfortunately, again in breach of the Practice Directions, namely, paragraph 4(c) of Practice Directions 10.1.

Conclusion

37.  For all the reasons above, I find the Father’s application for withdrawal or the alternative application for variation of the Undertakings fail.

38.  The Father’s Summons must be dismissed with costs to the Respondent Mother, to be taxed if not agreed.

39.  I also grant Certificate for Counsel.

Orders

40.  I now make the following Orders :-

(a)  The Applicant’s Summons dated 3^rd November 2015 be dismissed;

(b)  The Applicant do pay the costs of and occasioned by the Summons dated 3^rd November 2015 to the Respondent, including all costs reserved (if any), to be taxed if not agreed; and

(c)  The Respondent’s own costs be taxed in accordance with Legal Aid Regulations.