CNLC v. LTY

FCMC 16895 / 2011

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 16895 OF 2011

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BETWEEN

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J U D G M E N T
(Maintenance Pending Suit)

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1.  This is the Petitioner Wife’s application for Maintenance Pending Suit by way of a Summons issued on 27 February 2012 seeking maintenance for herself and the child of the family and also a contribution towards her legal costs.

Background

2.  The parties met whilst studying at the University of Cambridge. They were married on 25 September 2004 in Hong Kong. The Husband is now aged 34 and the Wife is 36. They have a son (“the Child”), who was born on 26 November 2005 (now 6 years old).

3.  The Wife says that in June 2011 she discovered that the Husband was having an affair with a Taiwanese TV star. Upon failure of reconciliation, the Husband moved out of the matrimonial home in August 2011 and has since been living with his mother.

4.  The Wife presented her Petition for divorce on 2 December 2011 and Decree Nisi was granted on 22 February 2012.  It is therefore a 7-year marriage. 

5.  Pursuant to the Order dated 5 March 2012, the parties were granted joint custody of Child, with care and control to the Wife, and reasonable access to the Husband. Pursuant to another Order also dated 5 March 2012, the Husband has undertaken to pay the Child’s school fees, the monthly salary of the domestic helper, and a sum up to HK$10,000 for extra-curricular activities / tuition, plus a further HK$10,000 per month as interim-interim maintenance of the Child until further order.

The Law

6.  Under MPPO Section 3 (maintenance pending suit) and Section 5 (provision for child), the Court may make orders requiring one party in a marriage to pay maintenance for the other party from the date of the presentation of the petition for divorce and for the other for the benefit of children of the marriage for such term as may be so specified. 

7.  The main governing principle is that the Court will make such order as it considers reasonable based on the reasonable needs of the Wife, the applicant herein and the Child and the ability of the Husband to pay.  In view of such application being interim in nature, the Court will not conduct detailed investigation of the financial position of the parties, but approach on a broad brush basis.

8.  Regarding the principles that underpin such an application, paragraph 16.17 of Rayden[1] states as follows:

“The court has an unfettered discretion to award such sum as it thinks reasonable. There is no hard and fast rule, and no fixed proportion: each case depends on its own facts. It has been said that the approach to maintenance pending suit should be empirical, and that in the ordinary sort of case the district judges who deal with these applications will have to take a broad view of means on the one hand and income on the other and come to a rough and ready conclusion, or to take a “broad brush approach”.  The overall consideration is the actual needs of the parties’ pending suit.”

9.  The court will also be looking at whether the applicant has an immediate need for financial support. Paragraph 16.18 of Rayden[2] states as follows:

“…what really matters is the immediate and reasonable requirements of the wife balanced against the ability of the husband to pay for them, assessed using a broad-brush approach.”

10.  Another important factor in determining this application is consideration of the marital standard of living during marriage. In a recent Hong Kong Court of Appeal case HJFC v KCY[3], Hartman JA said in para 37 of the Judgment as follows:

“The principles that have emerged over time to guide judges in matters of interim maintenance have been fashioned in the main to ensure fairness. This is well illustrated in the judgment of Nicholas Mostyn QC, sitting then as a deputy High Court judge, in TL v ML and Others (Ancillary Relief: Claim against Assets of Extended Family) [2006] 1 FLR 1263, at 1289, in which, having looked at earlier authorities, he derived the following principles that speak specifically to fairness or are based on the need to ensure it. For present purposes, it is sufficient to cite the relevant principles without citing the judge’s reference to the source of those principles:

i. The sole criterion to be applied in determining the application is ‘reasonableness’, which is synonymous with ‘fairness’.

ii. A very important factor in determining fairness is the marital standard of living. This is not to say that the exercise is merely to replicate that standard.

iii. In every maintenance pending suit application there should be a specific maintenance pending suit budget which excludes capital or long-term expenditure, more aptly to be considered on a final hearing. That budget should be examined critically in every case to exclude forensic exaggeration.

iv. Where the affidavit or form E disclosure by the payer is obviously deficient, the court should not hesitate to make robust assumptions about his ability to pay. The court is not confined to the mere say-so of the payer as to the extent of his income or resources. In such a situation, the court should err in favour of the payee.” (emphasis added)

11.  In particular, where the paying party has historically been supported through the bounty of an outsider, and where the payer is asserting that the bounty had been curtailed, but where the position of the outsider is ambiguous or unclear, then the Court is justified in assuming that the third party will continue to supply the bounty, at least until final trial.[4]

Wife’s case

12.  The Wife maintains that the parties enjoyed a very high standard of living during marriage.

13.  The Husband’s parents are businessmen, and majority shareholders of a public listed company F W International (“F W International”).  In July 2011, the Husband’s father agreed to pay HK$730 million to his mother to purchase her registered shareholding in F W International.  Some HK$600 million had already been paid by the Husband’s father to his mother. The Husband is a former chairman of a famous charitable Group of Hospitals (“the Charity”).  He had been on the board on the Charity from 2000 to 2011. In the past, F W International had donated over HK$10 million to the Charity.

14.  The Husband worked for F W International until January 2011.  He says his departure was caused by differences with his father. He is now a student with no income studying Master degrees in music and psychology until 2014.  According to his Form E, he still spends some HK$82,000 per month on himself. He does not have to pay rent as he is living with his mother in her property. 

15.  The parties were active members of high society during the marriage.  A supplementary credit card with spending limit of $80,000 was given by the Husband to the Wife since 2002 but was taken away in 2010. They went to expensive restaurants and frequented high-end balls and social events, naturally with expensive clothes and accessories. They also had expensive holiday, flying business class and stayed in 5-star hotels. They had a 2,500 square-foot apartment in King’s Park, 2 maids, access to 4 cars, a driver etc.  That is primarily funded by F W International and the Husband’s parents.

16.  The Husband hosted a HK$130,000 birthday party for himself in 2011. He could spend up to HK$350,000 in the two months (February and March 2011) after he was terminated by F W International in January 2011. He bought a brand new Steinway & Sons piano in October 2011 for HK$754,000 and payments of HK$15,000 and HK$10,000 to his piano teacher on 1 September and 17 November 2011 respectively. He drives a Porsche and a Mercedes and expects to change to another Porsche for HK$1.2 million in 2014.

17.  The Husband has HK$5 million in bank accounts and also has a 50% interest in a company (“E&I”), holding a rent-yielding property.  His interest is worth some HK$16.67 million. He and his sisters are the shareholders of E&I and he has confirmed that his parents had gifted the shares to them.

18.  As of 31 March 2011, E&I has some HK$4.5 million cash in bank.  For the years ending 31 March 2010 and 31 March 2011, E&I had revenue (representing rent) of HK$3 million a year.  The current monthly rental of the building owned by E&I (“E&I’s building”) is HK$275,000 since April 2012.

19.  The accounts of E&I are prepared on the basis that the E&I’s building is worth only some HK$29 million which is the purchase price and depreciation has been applied to it.  The Wife says that the market valuation actually goes up to HK$96 million.  Given that the Husband has a 50% interest in E&I, he has additional assets around HK$33.5 million [ie ($96m - $29m) /2].

20.  His father paid HK$13 million to compensate for the Husband’s (wholly voluntary) “loss of employment” after his employment has been terminated in January 2011.

21.  The Husband’s mother is now sitting on vast liquid wealth of at least HK$600m paid by the Husband’s father, and (just as before) the Husband plainly has access to her resources.

22.  The Wife estimates an amount of HK$50,000 a month for provision of legal costs and requests the Husband to pay the MPS for the total sum about $386,000 a month. 

Husband’s case

23.  The Husband says that throughout the marriage, the couple had never actually enjoyed the level of spending that the Wife now alleges. He is in any event quite unable to afford to pay the Wife the MPS figures being demanded.

24.  When the Husband was working in F W International, he was paid a salary of HK$80,000 per month, plus other very substantial perks and benefits, including rental of the matrimonial home from his mother’s company.

25.  However, in 2006 the Husband discovered that his father had (previously unbeknownst to him) fathered another family. The Husband began to have arguments with his father, and their relationship grew apart. As he has grossly fallen out with his father, he cannot expect to return to F W International any time soon.

26.  He admits that he has been living off of his capital savings.

27.  The Husband considers that the Wife has very strong earning capacity. Even back in 2002 she was already earning HK$80,000 per month at Goldman Sachs and then worked her way through the ranks at “EF Foundation”. By 2011 she was earning over HK$110,000 per month. However, the Wife changed from full-time to part-time in September 2011 and her salary was accordingly reduced.

28.  The Wife also receives rental income of HK$12,600. Her income for 2010 / 2011 was almost HK$1.5 million and for 2009 / 2010 was about HK$1.4 million.

29.  The Husband has liquid assets of about HK$5.2 million but most of this (about HK$3.2 million’s worth) is held in RenMinBi. He says that there are exchange controls involved.

DISCUSSION

Standard of living

30.  The first issue in dispute is what the standard of living of the parties before the breakdown of the marriage is. Based on the evidence given by the parties in their respective affirmations, I am satisfied that they enjoyed a very high standard of living and were active members of high society during marriage. Although the Husband challenged almost each and every item of expenses of the Wife and the Child, he just says that the Wife grossly exaggerated the expenses such as Dry Chinese Nutritional Food, Clothing, Personal Grooming, Holiday etc. However, he does not suggest any figures to such expenses, which he considers reasonable.  According to the well established legal principles, I will not conduct detailed investigation of the expenses and financial position of the parties, but approach on a broad brush basis.

31.  I have no doubt that much of the parties’ lifestyle was enjoyed during the marriage through several companies controlled by the Husband’s parents. For instance, the legal owner of the matrimonial home[5] is a company wholly controlled by the Husband’s mother (“CG”) which entered into a tenancy with F W International, which in turn granted a licence to the Wife and the Child to occupy.  The present rent of the matrimonial home (under an agreement between CG and F W International) is HK$82,000 per month. At the material time, F W International was controlled by the Husband’s father but Mr Jeremy Chan, Counsel for the Husband, submits that it is no longer the situation. The issue of judicious encouragement will be discussed in the latter part of this Judgment.

32.  Mr Jeremy Chan, Counsel for the Husband, argues that some of the expenses like Fengshui/Fortune Teller, Flowers, Donations, Contribution to Parents do not fall within MPS. However, I consider that what I shall look at is the standard of living of this particular family, whose expenses may include items which may not be considered essential by the regular man or woman in the street. I therefore reject this argument in view of the very high standard of living of the parties.  Just like the Husband who claims to be a student without income still spends over $82,000 every month and keeps on driving a Porsche which is worth over million dollars. It shows how lavish lifestyle of the Husband not only presently but also in the past is. On the other hand, the Husband is only paying about $28,000 per month as interim-interim maintenance for both the Wife and the Child.  I am of the view that it is plainly unreasonable.

33.  For most of the expenses, the Wife has produced documentary support thereof for herself and the Child.  In my view, although these documents are post-separation, the Court cannot expect the Wife to keep the receipts of the family’s expenses during the marriage. Save as discussed below, I accept that for the purpose of this MPS application, they substantially reflect the actual amount and cost to maintain the standard of living enjoyed by the parties and the Child before the breakdown of the marriage.

34.  Regarding Dry Chinese Nutritional Food, the Wife claims $25,000 per month. The Husband says that it was previously paid for by the Wife’s own mother not by the Husband’s mother. It is no doubt a dispute of fact but for the purpose of this MPS application, I resolve it in favour of the Wife without prejudice to the Husband’s right to challenge it at the final hearing of the ancillary relief proceedings. As to the amount, I am of the view that if the Dry Chinese Nutritional Food provided by the Husband’s mother during the marriage was for 3 people ie the Husband, the Wife and the Child, then after separation, the amount would be roughly reduced by 1/3 as the Husband moved out. Hence, I consider that the reasonable amount shall be $17,000 per month.

35.  With regard to the expense of Meal out of Home of the Child, the Wife claims $9,000 per month. Since the Child is only a 6 years old boy, I wonder how the sum of $9,000 can be incurred for him for meals out of home every month given that he has to go to school in the weekday and normally eat outside during holiday.  In my view, $3,000 per month is reasonable for this item.

36.  I do not intend to go for a detailed forensic examination of each and every expense.  Based on the parties’ standard of living during marriage, I assess on a broad brush basis the immediate and reasonable requirements of the Wife and the Child in the sum of $287,016 per month, breakdown of which is set out as follows:

General

Item	Amount (HK$)
Utilities (electricity, gas, rates, internet, telephone & water)	4,000
Management fee	5,443
Dry Chinese Food	17,000
Home maintenance/decoration/minor repair	4,000
Food	9,000
Household expenses	7,000
Flowers	2,000
Dog	1,000
Domestic helpers	4,330
Fengshui/Fortune teller	2,000
Sub-total	55,773

Personal

Item	Amount (HK$)
Meals out of home	10,000
Communities fees/Donations/charity event	20,000
Clothing/ Shoes	20,000
Personal grooming (including haircut and cosmetics)	8,000
Entertainment	6,000
Presents	6,000
Holidays
Taxi/Transport	2,500
Tax	10,000
Mobile phone bill	500
Contribution to parents	10,000
Medical / Dental/Supplement	1,500
Insurance premia	2,969
Chinese New Year Laisee	1,000
Mortgage	21,531
Properties Management fee	1,686
Sub-total	146,686

Child

Item	Amount
School fees	4,237
Extra tuition fees	11,150
Meals out of home	3,000
School books and stationery	1,000
Transport to school	790
Medical / Dental /Supplement	1,500
Extra-Curricular Activities	25,900
Entertainment / presents	2,500
Clothing / Shoes	5,000
Eyeglasses	400
Haircut	200
Car rental + driver	25,000
Uniform	300
Child Minding/new Domestic helper	3,580
Sub-total	84,557
Grand total (55,773 + 146,686+ 84,557)	287,016

Parties’ Earning Capacities and Incomes

37.  The Wife has the rental income of a property of HK$12,600 every month. I must take this into account.  Her income for 2010 / 2011 was almost HK$1.5 million and for 2009 / 2010 was about HK$1.4 million.  As she changed from full-time to part-time in September 2011, her present income is reduced to HK$76,016 per month. No reason is given for change from full-time to part-time by the Wife. The Husband says that she has much higher earning capacity.

38.  On the other hand, the Husband fails to explain why he chooses to study Master degrees in music and psychology after the commencement of the divorce proceedings by the Wife. In my view, the Court has to look at the real earning capacity of both parties which must be fully utilized rather than their actual income shown at this moment.  I consider that given the similar education level and working experience of the parties, they have more or less the same earning capacity. For the purpose of this MPS application, I assess on a broad brush basis that both of them are able to earn about $100,000 per month.

39.  Besides, I should also consider that the Husband owns 50% interest in E&I which has some HK$4.5 million cash in bank and is receiving rental of $275,000 every month according to its account. Although he says that E&I’s cash has to be used to repay the shareholder loan, I reject the same since he and his sister are the exclusive shareholders of this company. Furthermore, the accounts of E&I indeed show that the bank balances have not been used to repay the shareholders loans.  I am of the view that the Husband should have access to this cash in E&I (inclusive of the monthly rental received).  I see no reason why such cash cannot be used for the maintenance of the Wife and the Child, especially when the Husband also admits that he has been living off of his capital savings.

Judicious encouragement

40.  Another main issue is that the Wife alleges that the parties’ living during the marriage was funded by the Husband’s parents or the companies controlled by them.  Mr Jeremy Chan for the Husband submits that this is not a case where Thomas v. Thomas-type “judicious encouragement” might be appropriate.  In a recent Hong Kong Court of Appeal case, KEWS v NCHC[6], Hon Cheung JA who made a very detailed analysis on this issue said as follows:

“45.In relation to capital provision, what I have said about the financial support the Husband has been receiving from his family is equally pertinent.  In the leading case of Thomas v Thomas [1995] 2 FLR 668, Waite LJ explained the law as follows (at pp 670F to 671A/B):

“But certain principles emerge from the authorities. One is that the court is not obliged to limit its orders exclusively to resources of capital or income which are shown actually to exist. The availability of unidentified resources may, for example, be inferred from a spouse’s expenditure or style of living, or from his inability or unwillingness to allow the complexity of his affairs to be penetrated with the precision necessary to ascertain his actual wealth or the degree of liquidity of his assets. Another is that where a spouse enjoys access to wealth but no absolute entitlement to it (as in the case, for example, of a beneficiary under a discretionary trust or someone who is dependent on the generosity of a relative), the court will not act in direct invasion of the rights of, or usurp the discretion exercisable by, a third party. Nor will it put upon a third party undue pressure to act in a way which will enhance the means of the maintaining spouse. This does not, however, mean that the court acts in total disregard of the potential availability of wealth from sources owned or administered by others. There will be occasions when it becomes permissible for a judge deliberately to frame his orders in a form which affords judicious encouragement to third parties to provide the maintaining spouse with the means to comply with the court’s view of the justice of the case. There are bound to be instances where the boundary between improper pressure and judicious encouragement proves to be a fine one, and it will require attention to the particular circumstances of each case to see whether it has been crossed.”

46.  …

47.  Thomas has been followed in many subsequent cases.  It is true that it was a case where the husband was a beneficiary under a discretionary trust.  It is also true that a distinction has been drawn by Deputy High Court Judge Nicholas Mostyn QC (as he then was) in TL v ML [2006] 1 FLR 1263, para 86, between that situation and the one where the paying spouse is just a member of a wealthy family.  In paragraph 101, the Deputy Judge expressed the following view: 

“The correct view must be this. If the court is satisfied on the balance of probabilities that an outsider will provide money to meet an award that a party cannot meet from his absolute property, then the court can, if it is fair to do so, make an award on that footing. But if it is clear that the outsider, being a person who has only historically supplied bounty, will not, reasonably or unreasonably, come to the aid of the payer, then there is precious little the court can do about it.”

48.In this jurisdiction, the doctrine of judicious encouragement has clearly been applied to a non‑trust situation by this court in FMFT v HKWE [2001] 1 HKC 134.  In that case, the trial judge accepted that the husband, who came from an “extremely wealthy family”, had no real possibility of receiving any capital nor would there be any change in his financial situation in the foreseeable future.  He found that the wife would not be able to take up any employment.  He concluded that both of them led a comfortable way of life despite having little visible income.  He also found that the husband had been bailed out financially by his family and that he could obtain loans from his father’s companies or relatives.  There was little trouble if they were not repaid.  He lived rent‑free in a family property and the outgoings were paid by family companies.  The judge therefore ordered a lump sum of $5 million toeffecta clean break to provide a new home for the wife and the child.  On appeal, the Court of Appeal reaffirmed the application of the notion of judicious encouragement in appropriate cases.  After examining the evidence, the Court of Appeal refused to interfere with the judge’s order…

49.  In my view, even though the present case does not involve any discretionary trust or the giving of any judicious encouragement to a trustee as such, this is no obstacle in itself to the application of the notion of judicious encouragement.  On the other hand, I do accept that one must exercise great caution before applying the notion to any set of facts.  Amongst other things, the court should not engage in a futile exercise.  This was, rather sadly, illustrated by what happened subsequently to the lump sum order of $5 million in FMFT.  The husband eventually failed to raise the money to satisfy the court order.  The wife brought the husband to court under a judgment summons which came before Judge Gill: X v Y,FCDJ 536/1997 (21 June 2002).  According to the judgment, the husband’s family refused to help.  In paragraph 28, the Judge observed: “The only practical way in which the husband might feasibly have satisfied the judgment debt remained steadfastly behind a closed and locked door, that which would lead to an audience with his father.”  He therefore concluded that there was really nothing further the husband could do to satisfy the lump sum order.  He made no order under the judgment summons but awarded costs against the wife.

50.  Each case must be decided on its own facts.  I am satisfied that, when viewed in the round, this is an appropriate case for the application of the notion of judicious encouragement.  The Husband’s family has clearly been supporting him throughout, including funding the present legal proceedings.  The Judge has made an express finding that the financial support will continue in future.  Furthermore, unlike many other cases, the Husband clearly has under‑utilized earning capacity.  Hence, when one refers to judicious encouragement here, one does not only have in mind the family of the Husband, but also the Husband himself in terms of full utilization of his earning capacity.  Furthermore, one also bears in mind the amount to be ordered as well as the time of payment.

51.  As regards the amount, having looked at the entire circumstances, including in particular the Wife’s needs, the amount that her parents have expended on her whether before or after the 2006 separation, the length of the marriage and the fact that no children are involved, I take the view that a lump sum of $1.5 million would be a fair and reasonable amount…

Judicious encouragement to third parties

59.  Where the available resources are currently under the control of third parties, such as trustees or wider family members, the Court will not usurp the rights of the third parties or apply improper pressure on the third parties.  But the Court has developed the concept of ‘judicious encouragement to third parties’ which permits the judge to frame the order in a form which affords judicious encouragement to third parties to provide the maintaining spouse with the courts’ view of the justice of the case, see FMFT v. HKWE [2001] 1 HKC and W v. W (FCMC 2348/2002) both applying Thomas v. Thomas [1996] 2 FCR 544, 546 per Waite LJ. See also H v. H (financial report: conduct) [1998] 1 FLR 911; X v. X (Y and Z intervening) [2002] 1 FLR 508; M v. M (Maintenance pending suit) [2002] 2 FLR 123.” (emphasis added)

41.  Despite the fact that KEWS v NCHC[7] is undergoing an appeal to the Court of Final Appeal[8], this Court of Appeal decision is still binding on me until it is overruled.  In my judgment, I need to decide whether it is a proper case to apply the notion of judicious encouragement.

42.  Mr Jeremy Chan appearing for the Husband produced some extract from the new media to show that after the IPO of F W International, the company has since slipped away from the control of the Husband’s father and apparently is now not really even a “family business” anymore.  Although it seems not objected by Mr Bernard Man, Counsel for the Wife, I do not accept the way of production of this evidence by Mr Chan. The proper way to produce this evidence must be by way of the Husband’s application for leave to file supplemental affirmation. But he fails to do so.

43.  Even if this evidence that F W International is no longer family business is acceptable to me, it does not follow that the notion of judicious encouragement is not applicable in this case.  In my view, the Husband’s father just made use of F W International as a vehicle to provide the financial support to the Husband and his family in the past.  The fact that F W International slipped away from the control of the Husband’s father does not necessarily mean that the Husband’s father will not use his own wealth to support this family.  It is not in dispute that the Husband’s father is still the biggest single shareholder of F W International holding more than 30 % shares thereof.  He is an extremely wealthy person.

44.  The Husband says that he has arguments with his father, and their relationship grew apart and that the relationship between his mother and himself had lately changed, “in a negative aspect”.  He also alleges that he has not received any “subsidy” from his parents and is “unlikely to receive any in the future”.  In my judgment, he has not given any explanation as to why his relationship with his mother would suddenly deteriorate.  There is also no evidence from his mother as to the state of their relationship, and reasons for any “deterioration”.  I suppose that their relationship would become closer upon the discovery of the first family of the Husband’s father.  It is also noteworthy that he has been residing with his mother since separation with the Wife.

45.  More important is that the Wife produced a copy agreement in Chinese given by the Husband’s father to her, according to which the Husband’s father will pay his mother $700 million. This $700 million includes almost all the expenses of the Husband such as his accommodation ($82,000 X 36 months), a Porsche, credit card spending (maximum $1.8 million) etc. It even covers his 36 month-salary (at $83,000 per month) and MPF (15%) contribution. I consider that even if such payment is not made direct to the Husband but to the Husband’s mother, she will no doubt use this money support the Husband. This is a very strong evidence to disprove what the Husband said that he is unlikely to receive any subsidy in the future.

46.  It is clear that the Husband’s mother has just received HK$600 million from his father and is financially capable to maintain the Wife and the Child.  As said by Deputy High Court Judge Mostyn QC (as he then was) in TL v ML[9],this Court is justified in assuming that the Husband’s mother will continue to supply the bounty at least until final trial.  For the purpose of this MPS application only, I conclude that it is a proper case to apply the notion of judicious encouragement. No doubt, the Husband’s mother is at liberty to file affirmation or testify otherwise at the trial of the final hearing of the ancillary relief. It will then be decided by the trial judge.

Legal Costs Contribution

47.  The Wife contends that she requires funds to be properly represented in this litigation.  She is now asking for the sum of HK$50,000 a month towards her costs contribution.

48.  The guiding principles of costs allowance found in Currey v Currey (No 2)[10] are to be adopted in HJFG v KCY[11], whereby Hartman JA said:

“79. Aside from the fundamental requirement of supplying a sufficiently detailed breakdown of anticipated costs, I am of the view that the following principles articulated by Wilson LJ in Currey should in future be adopted as providing prudent guidance to both judges and practitioners in this jurisdiction.

80.  In the view of Wilson LJ, the initial, overarching inquiry should be into –

“…whether the applicant for a costs allowance can demonstrate that she cannot reasonably procure legal advice and representation by any other means. Thus, to the extent that she has assets, the applicant has to demonstrate that they cannot reasonably be deployed, whether directly or as the means of raising a loan, in funding legal services.”

81.  As Wilson LJ pointed out, satisfying that condition alone may not be sufficient.  In the broad exercise of discretion, a judge may consider that other factors must come into play –

“The subject matter of the proceedings will surely always be relevant; and, insofar as it can safely be assessed at so early a juncture, the reasonableness of the applicant’s stance in the proceedings will also be relevant.””

49.  Wilson LJ further said in paragraph 20 of the judgment in Currey[12]:

"…Furthermore, not to forget the third of Thorpe L.J.'s three features, she has also to demonstrate that she cannot reasonably procure legal services by the offer of a charge upon ultimate capital recovery.  I would add, fourthly, that the court needs also to be satisfied that there is no such public funding available to the applicant as would furnish her with legal advice and representation at a level of expertise apt to the proceedings…”

50.  According to Wife’s Form E dated 15 February 2012, she briefly owns 3 real properties, the total net value of which is about $3.2 million, cash at bank about $750,000 and also the Bonds and the Alternative Fund valued about $5.2 million in total.  In the Wife’s Affidavit filed 16 June 2012, she said that the Bonds only mature in 2015 and 2016 and the Alternative Fund cannot be sold until June 2019.  Thus, Mr Bernard Man, Counsel for the Wife, submits that the Wife only has liquid assets of about HK$1.5m and can hardly be expected to deplete it (or pledge it) for legal costs.  However, the Wife fails to explain why the 3 real properties cannot be re-mortgaged or pledged to raise fund for this litigation.  Furthermore, the Bonds can be sold (though may be at certain discount) at the second hand market before their maturity.  I am not satisfied that the Wife has no assets which can reasonably be deployed, whether directly or as the means of raising a loan, in funding legal services. I therefore refuse to the Wife’s request for costs allowance.

Conclusion

51.  For the purpose of this MPS application, I take the view that the Husband’s mother will continue to supply the bounty. Besides, as the affidavit and Form E disclosure by the Husband is obviously deficient, this Court is entitled to make robust assumptions about his ability to pay and conclude that he is able to pay.  Since the Court is not confined to the mere say-so of the Husband as to the extent of his income or resources, I should err in favour of the Wife.

52.  The immediate and reasonable requirements of the Wife and the Child have been assessed at $287,016 per month. The Wife has the ability to earn $100,000 per month plus her rental income of $12,600 per month. The Husband shall pay $174,416 (ie $287,016 - $100,000 - $12,600) rounding down to $174,000 per month. Having carefully considered all the circumstances and the relevant legal principles, I now order that:

1.  the Respondent do pay the Petitioner $174,000 per month as maintenance pending suit commencing from 1 August 2012 until further order; and

2.  the Order dated 5 March 2012 relating to interim-interim maintenance and the Undertaking of the Respondent therein do cease to have effect from 1 August 2012.

53.  Regarding the question of costs, since broad brush approach is adopted and the Wife only partly succeeds in this MPS application but fails in costs allowance, I would make an order nisi that costs of and occasioned by this application be reserved and be determined at the final hearing of the ancillary relief proceedings.  Such costs order nisi will become absolute unless any of the parties apply to vary the same by way of Summons within 14 days.