CCL V. CWK

FCMC 11465 / 2012

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 11465 of 2012

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

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Introduction

1. This is a trial on the Petitioner wife’s application for ancillary relief, including a maintenance application for the two children of the family, against the Respondent husband.

2. The said children, namely, two daughters, born on 18 June 2001 and 14 June 2003, now aged 13 and 11 respectively. 

3. Pursuant to the Order dated 9 August 2012, joint custody of the said children was granted to the parties with care and control to the Petitioner (“Wife”).  The Respondent (“Husband”) was given reasonable weekly access from Friday evenings to Saturday mornings.

4. The trial which was fixed for two days commencing on 1^st April 2014 went part heard and subsequently adjourned to 8^th May 2014. 

The main issues

5. Initially, there were quite a number of issues in respect of ancillary relief matters in dispute.  However, during the course of trial, both parties, with the assistance of their legal advisers, have made genuine effort and were able to resolve some of their differences.

6. In gist, the parties reached an agreement that a) the former matrimonial home located at Flat XX, XX^th Floor, Tower XX, Phase XX, Le Point of Metro Town, No.8 King Ling Road, Tseung Kwan O, New Territories, Hong Kong (“the Matrimonial Property”); and b) Car Parking Space No.XX located in Botania Villa, No.138 Fuk Hang Tsuen Road, Tuen Mun, New Territories, Hong Kong (“CPXX”) would be sold and its net proceeds distributed in equal shares. 

7. The parties also agreed that the Husband would pay a monthly sum of $9,000 towards the accommodation needs of the said children after the sale of the Matrimonial Property.   

8. Further, the Husband agreed not to pursue the whereabouts of the sale proceeds of two other properties, namely, Flat X, X^th Floor, Block X, Botania Villa, No.138 Fuk Hang Tsuen Road, Tuen Mun, New Territories, Hong Kong (“Botania Villa”) and Flat X, XX^th Floor, Tower X, Phase XX, Le Point of Metro Town, No.8 King Ling Road, Tseung Kwan O, New Territories, Hong Kong (“Flat 56F”), which were sold in 2010 and 2011 respectively. 

9. However, the parties were unable to agree on ‘when the sale of the Matrimonial Property should take place’ and ‘the amount of specific monthly maintenance for the said children of the family to be paid by the Husband’.  The Wife also seeks a lump sum order for the future accommodation payments to be paid out from the net sale proceeds of the Matrimonial Property and a lump sum/secured periodic payments for the monthly maintenance of the said children, both of which the Husband opposes.

10. Thus, the remaining issues to be determined by the Court are:-

i)   the amount of reasonable specific monthly expenses (excluding accommodation expenses) of the said children;

ii)   the apportionment of the said children’s specific monthly expenses payable by the Husband;

iii)   whether the periodic payments for the specific monthly expenses of the said children should be secured, and if so, in what manner;

iv)   whether there should be a lump sum order for the accommodation expenses for the said children of the family, to be paid out of the net sale proceeds of the Matrimonial Property; and

v)  the date on which the Matrimonial Property should be sold.

The Law and Legal Principles

11. The jurisdiction of the Court in granting financial relief for a party is governed by Section 4 of the Matrimonial Proceedings and Property Ordinance, Cap 192 (“MPPO”) which provides:-

“4. Financial provision for party to a marriage in cases of divorce, etc.

(1) On granting a decree of divorce, a decree of nullity of marriage or a decree of judicial separation or at any time thereafter (whether, in the case of a decree of divorce or of nullity of marriage, before or after the decree is made absolute), the court may, subject to the provisions of section 25(1), make any one or more of the following orders, that is to say-

(a) an order that either party to the marriage shall make to the other such periodical payments and for such term as may be specified in the order;

(b)  an order that either party to the marriage shall secure to the other to the satisfaction of the court, such periodical payments and for such term as may be so specified;

(c)  an order that either party to the marriage shall pay to the other such lump sum or sums as may be so specified.

(2)  Without prejudice to the generality of subsection (1) (c), an order under this section that a party to a marriage shall pay a lump sum to the other party-

(a)  may be made for the purpose of enabling that other party to meet any liabilities or expenses reasonably incurred by him or her in maintaining himself or herself or any child of the family before making an application for an order under this section;

(b)  may provide for the payment of that sum by instalments of such amount as may be specified in the order and may require the payment of the instalments to be secured to the satisfaction of the court.”

12. The governing principles in relation to financial provision for the children of the family are set out in Section 5 of the MPPO and Orders for transfer and settlement of property and Orders for sale of property are set out in Section 6 and 6A of the MPPO.

13. In considering the distribution of family assets in the dissolution of marriage, the matters to which the Court is to have regard in making any order under Sections 4, 5 and 6, are set out in Section 7 of the MPPO as follows:

“7. Matters to which court is to have regard in deciding what orders to make under sections 4, 5 and 6

(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 to 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.

14. The Court of Final Appeal in LKW v DD, FACV No.16 of 2008 [2010] 13 HKCFAR 537, set out 4 principles regarding how Section 7 should be approached.  In brief, they are:-

a) Objective of fairness

The first principle is that the implicit objective of a Section 7 exercise is to arrive at a distribution of assets which is fair as between the parties;

b) Rejection of discrimination

The second principle is that the concept of fairness requires the refutation of any gender or role discrimination;

c) Yardstick of equal division

The third principle is that, with a view to eliminating insidious discrimination and promoting fairness, judges should check their tentative views on distribution against a “yardstick of equal division” which should be departed from only for good, articulated reasons;

d) Rejection of minute retrospective investigations

The fourth principle is that the court should not countenance any attempt to engage in costly and often futile retrospective investigations of the failed marriage which tend to deplete the parties’ (and the courts) resources and to increase antagonism and discourage settlement;

15. The Court of Final Appeal in LKW v DD also laid down 5 steps for a Section 7 exercise, which are briefly set out as follows:-

(i)  Step 1: Identification of the assets

The ascertainment of the financial resources of each of the parties calculated as at the date of the hearing (paragraphs 71 to 73 of the Judgment);

(ii)  Step 2: Assessing the parties’ financial needs

The assessment of the parties’ financial needs.  If the total resources are not enough to meet the parties’ needs, the section 7 exercise should stop here and there is no room to apply any sharing principle (paragraphs 74 to 79 of the Judgment);

(iii)  Step 3: Deciding to apply the sharing principle

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

(iv)  Step 4: Considering whether there are good reasons for departing from equal division

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

(v) Step 5: Deciding the outcome

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

Brief background

16. The Wife is 44 years old and a civil servant working as a health inspector.  Her current salary is about $49,495 per month plus housing allowance of about $5,710 per month.  Thus, her total income is about $55,205 per month.  [RB:A:151] 

17. The Husband is 46 years old and works as an operation director for a technology company.  His current salary is about $75,695 per month plus double pay of about $6,966 and bonus of about $7,663 per month. Thus, his total income is about $90,324 or rounded up to $90,475 per month as stated in his Form E.  [RB:B:243] 

18. The parties married in January 1999.  On 17 October 2011, the Wife filed a Petition for divorce under FCMC 14323 of 2011 based on the Husband’s unreasonable behaviour and on 1 November 2011, the Husband filed a Petition for divorce under FCMC 15207 of 2011 based on the Wife’s unreasonable behaviour.

19. By the order of His Honour Judge C.K. Chan dated 24 April 2012, it was ordered, inter-alia, that both Petitions based on unreasonable behaviour be stayed and leave was granted to the Wife to file a fresh Petition on or after 1 July 2012 based on one year separation with the date of separation fixed on 27 June 2011.  

20. Prior to the breakdown of the marriage, the whole family resided at the Matrimonial Property which was purchased in 2009 in the sole name of the Wife.

Identification of the family assets

21. It is not disputed that the Matrimonial Property is the main family asset and the current agreed valuation of the same is $11,500,000.  The Matrimonial Property is approximately 1200 sqf with 4 bedrooms and a club house.  The said children continued to reside at this home with the Wife after the parties separated in around June 2011.   [RB:A:11]

22. Shortly prior to the marriage, in 1998, the parties in their joint names Botania Villa presumably as their matrimonial home. Botania Villa was sold in around 2009/2010.   [Exhibit R1]

23. During the marriage, in 2007, the parties bought another property, namely, Flat 56F which was registered in the sole name of the Wife.  Flat 56F was sold in around October 2011.  [RB:C:443]

24. At the beginning of the trial, Counsel for the Husband submitted that the Wife had unilaterally and without his consent sold Flat 56F.  The Husband therefore claimed entitlement to 50% of the net sale proceeds and sought a lump sum payment from the Wife equivalent to 50% of the net sale proceeds of Flat 56F.  Counsel for the Husband also submitted that the Wife should account for the proceeds of sale of Botania Villa. 

25. However, at the adjourned hearing, Counsel for the Husband confirmed that the Husband no longer pursued the whereabouts of the net proceeds of sale of Flat 56F nor the sale proceeds of the Botania Villa. 

26. The Husband’s revised open offer at the adjourned hearing was for the Matrimonial Property to be sold before 31 August 2014 with the net proceeds of sale to be distributed to the parties in equal shares.  He agreed to pay $9,000 per month to the Wife towards the accommodation needs of the said children until the younger daughter reaches the age of 21 or ceases full time education whichever is later, commencing on the date of delivery up of vacant possession of the Matrimonial Property upon sale. He also offered to pay the Wife maintenance for the said children (excluding accommodation expenses) in the sum of $11,000 per month ie. $5,500 per month per child.

27. He did not agree to the Wife’s claim for reimbursement of $6,000 per month from July 2011 to the date of sale of the Matrimonial Property, being half share of the monthly mortgage repayments in respect of the Matrimonial Property.  However, he proposed to reimburse his share of mortgage repayments in the sum of $3,000 per month from July 2011 until the government subsidy (to the Wife) ends in August 2014, and thereafter $6,000 per month until delivery up of vacant possession of the Matrimonial Property upon sale.  

28. The Wife initially did not agree to sell the Matrimonial Property and sought a Mesher Order in respect of the Matrimonial Property to allow the said children to live there until they both reach 21 years of age. 

29. However, at the adjourned hearing, Counsel for the Wife confirmed that the Wife no longer insisted on a Mesher Order and agreed to an Order for sale of the Matrimonial Property (with completion not to take place before October 2015) and the net sale proceeds to be distributed to the parties in equal shares.

30. The parties also agreed that there is another family asset, namely, Car Parking Space No.XX located in Botania Villa (“CPXX”) which was purchased by the parties in their joint names in 1998 and transferred to the Wife’s sister, Chan Chi Mei in 2009.  According to the parties, there is no dispute that the Wife’s sister holds CPXX on trust for them in equal shares. The parties agree that the same should be sold and its net proceeds to be distributed to the parties in equal shares. The agreed valuation of CPXX is $250,000. [RB:C:486 and A:11]

31. In addition to the landed properties, the parties agreed to the figures set out in the List of Assets prepared by Counsel for the Wife and submitted to the Court on the first day of trial as follows:

Assets	Agreed value	Wife (Petitioner)	Husband (Respondent)
Matrimonial Property	$11.5 million Outstanding mortgage: $3.1 million Net value: $8.4 million	50% ($4.2 million)	50% ($4.2 million)
Car Parking Space No.48, Botania Villa, (CP48)	$250,000	50% ($125,000)	50% ($125,000)
Savings in bank		$152,268	$398,679
Investments		$796,184 Hang Seng Bank	$190,328 Friends Provident Int’l
Cars and Boat 1)  Toyota Estima 1994 2)  BMW 328i 1998 3)  Mainship 40 Sedan Bridge 1995			1)  $80,000 2)  $2,000 3)  $300,000
Total:		$5,273,452	$5,296,007
Pensions/MPF		$2.1 million (as at 2025)	$433,777 (as at 2032)

The parties’ financial needs

32. I have seen and heard both parties give evidence in court and they have both impressed me as being intelligent and educated individuals capable of maintaining their relatively stable careers. 

33. It is not disputed that both parties have a respectable income, and the Husband’s total income of about $90,475 per month is nearly double than that of the Wife’s income, excluding housing allowance, of about $49,495 per month.

34. According to the Husband’s updated Form E, he has two residences which are rental units, one in Lam Tin where he resides 80% of the time with his parents and domestic helper at a rental of $15,000 per month and another one in Sheung Shui where he resides 20% of the time when he has late company meetings and returns from work in the Mainland at a rental of $5,800 per month.

35. The Husband’s general monthly expenses amount to $44,130 per month as follows:

Item	Husband’s general monthly expenses (HK$)	Remarks
Rental of Lam Tin flat	15,000
Rental of Sheung Shui flat	5,800
Utilities	2,800
Food and household expenses	5,500
Car expenses	8,000
Insurance premia	920
Domestic helper	4,200
Car park rental in Yau Tong	1,910
Total	44,130

36. His personal expenses amount to $40,644 per month, the breakdown is as follows:-

Item	Husband’s case Amount per month (HK$)
Meals out of home	3,700
Transport	3,920
Clothing/Shoes	1,500
Personal grooming	1,000
Entertainment/presents	3,200
Tax	12,680
Insurance premia	1,044
Contribution to parents	6,000
Melassa Treatment Laser (Twice a month)	3,600
Boat Docking	4,000
Total:	40,644

37. Thus, the Husband’s alleged total monthly expenses (including lunch and pocket money for his children in the sum of $1,000 per month) amount to $85,774 (44,130 + 40,644 + 1,000).  [RB:B:247]

38. It is also noted from the Husband’s updated Form E that his anticipated future expenses include overhaul boat maintenance of $292,691 in March 2014 and an annual maintenance of $40,000 or $3,333 per month. He also has a revolving credit facility of about $163,000.

39. Counsel for the Wife argued that it is unnecessary for the Husband to maintain 2 separate residences in Hong Kong, with a total rental of $20,800 per month, 2 cars, and yacht which requires a boat docking fee of $4,000 per month and an annual maintenance fee of $40,000.  Counsel for the Wife also questioned the Husband on his need to incur $3,600 per month on laser treatment to reduce the pigments on his face.

40. Having considered the overall circumstances and evidence available, I am of the view that the Husband’s said expenses appear to be on the high side.  In particular, I find it unnecessary for the Husband to maintain 2 cars in Hong Kong and incur $9,910 per month as car expenses and car park rental, on top of transport expenses of $3,920 per month, when he himself is of the view that the sum of $1,400 as transport fees for the said children is excessive and suggested $500 per month instead.    

[Exhibit R2]

41. I also find it financially incomprehensible for the Husband to acquire a yacht for $400,000 after separation and incur $7,333 per month for docking and annual maintenance fee, whilst offering to pay $5,500 per month per child to cover his share of the said children’s education, extra-curricular, food and other specific monthly needs.  Although the Husband says that he purchased the yacht with the hope to spend quality time with the said children on the yacht, there is no evidence at this stage that the said children have any interest in yachting or water sports.   

42. I also note from the Husband’s Form E that he spends $5,500 +$3,700 ie. $9,200 per month on food, household expenses and meals out. However, according to the evidence he produced at the hearing regarding what he considers reasonable as food expenses for the Wife and said children, he is of the view that $148 per day for 4 persons (including the helper) is sufficient. The Husband appears to adopt a double standard regarding what is reasonable for food to be consumed by him compared to what is reasonable for the Wife and said children.  

43. I am therefore of the view that the Husband’s reasonable current expenses, on a broad assessment, are more likely to be in the region of $58,886 per month instead of $85,774 having discounted half the car expenses ($9,910/2 = $4,955), one of the residences which he spends 20% of his time in ($5,800), the domestic helper fees ($4,200) and half of his monthly expenses on food and meals out ($9,200/2 = $4,600) and boat docking and maintenance fees ($4,000+ $3,333 = $7,333). 

44. I appreciate and accept that it is common practice in Chinese culture to contribute to the living expenses of one’s elderly parents as an act of filial piety, where financial circumstances permit.  However, I am of the view that such contribution should not take precedence to one’s responsibility towards the financial support of their young children. 

45. I now turn to the financial needs of the Wife and said children. The Wife had been represented by different legal advisers and at times represented herself in these proceedings.  I therefore note that some of the table of expenses exhibited in her affirmations may not be presented as clearly as one would have hoped. Nevertheless, having seen and heard her give evidence at trial, I am of the view that she is a straightforward person and the items and figures set out in her updated Form E and Affirmation both dated 14 February 2014 are in general reasonable, having regard to the standard of living of the parties and the overall circumstances.

46. According to the Wife, the Husband ceased to support the family financially in July 2011 and she had to incur $51,917 per month to maintain the family.  The Wife made various adjustments when she gave evidence in court, the monthly recurrent expenses for the said children, excluding mortgage instalments and her own personal expenses amount to $35,816 as follows:

Item	Children’s recurrent monthly expenses  (HK$)	Remarks
Rates	1,400	2/3 =933.33
Utilities	3,000	2/3 = 2,000
Management fees	1,816	2/3 =1,210.66
Sundries	700	2/3 =466.66
Insurance premia	600	2/3 =400
Domestic helper	6,000	2/3 =4,000
Sub-total A	13,516	9,010.65
Food	7,000
School expenses	100
Extra- curricular activities	5,000	*include girls’ scouts, piano lessons, British Counsel lessons etc.
School books and stationery	1,000
Transport	3,000
Medical	1,500
Pocket money	600
Clothing and school uniform	1,100
Entertainment	3,000
Sub-Total B	22,300
Total A+B	35,816
Mortgage instalments	12,201.09	Re Matrimonial Property

47. In addition to the above expenses, the Wife has her personal expenses, but it is not entirely clear what the actual amount is.  The figure of $34,595.43 as stated in her Form E dated 14 February 2014 appear to be on the high side. On the other hand, the sum of $9,200 per month for tax and contribution to parents as stated in her Affirmation dated 14 February 2014 is obviously incomplete.  Having considered the overall circumstances, I will discount the sum of $15,230 which is stated as mortgage repayment from $34,594.43 and take the figure of $19,364.43 rounded up to $20,000 per month as her personal expenses, which is roughly half of the Husband’s alleged personal expenses.

48. Broadly speaking, the Husband’s main dispute is on (a) food of $7,000 per month for 4 persons (including the domestic helper); (b) extra tuition fees of $5,000 per month; (c) transport fees of $3,000 per month; and (d) utilities of $3,000 per month. 

49. Having considered all the circumstances, including the evidence from the Husband and Wife with regard to the standard of living that the said children are accustomed to, I am of the view that the figures submitted by the mother is both realistic and reasonable.

50. On the other hand, I find the Husband’s challenge to be unreasonable.  I refer to the list of food costs set out below prepared by the Husband based on the Parknshop on line prices to support his contention that $148 per day for 4 persons and 3 meals a day should be sufficient.  I am of the view that breakfast totalling $33 for 4 persons, based on 2 slices of bread and 2 eggs each plus milk for breakfast; or $45 for lunch for 4 persons; and $70 for dinner for 4 persons to be impracticable and unrealistic for a family used to a relatively comfortable lifestyle and residing in a 1200 sqf apartment with 4 bedrooms and a club house and a combined income of about $150,000 per month.  

List of foods
Item		Price	Qty		Cost per day
1.	Chicken 1	16.9	1	pack	16.9
2.	Chicken 2	18.9	1	pack	18.9
3.	Rice	57.9	5	kg	5.79
4.	Bread	10.3	1	pack (14 pcs)	5.8857/14286
5.	Eggs	27.9	1	pack (30 pcs)	7.44
6.	Veg 1	7.9	1	pack	7.9
7.	Veg 2	5.9	1	pack	5.9
8.	Tomato	8.9	1	lb	4.45
9.	Potato	6.9	1	pack	3.45
10.	Pork	19.5	1	pack	19.5
11.	Beef	17.5	1	pack	17.5
12.	Milk	24.5	1	litre	19.5

Breakfast
Item		Cost
1	Eggs	7.44
2	Bread	5.885714
3	Milk	19.5
		Subtotal	32.82571

Lunch
Item		Cost
1	Chicken 1	16.9
2	Veg 2	5.9
3	Pork	19.5
4	Rice	2.895
		Subtotal	45.195

Dinner
Item		Cost
1	Tomato	4.45
2	Potato	3.45
3	Pork	19.5
4	Rice	2.895
5	Veg 2	5.9
6	Beef	17.5
7	Chicken 1	16.9
		Subtotal	70.595
		TOTAL	148.6157	Per day
		=	4458.471	Per month

51. I also find the sum of $5,000 ie. $2,500 per month per daughter for extra- curricular activities/tuition to be reasonable, taking into account the evidence available and receipts produced by the Wife.  With regard to transport fees for both children, I accept the Wife’s evidence that as a working mother looking after two children without the use of the family car, the children take taxis to various activities after school in addition to public transport to and from school.  Thus, the sum of $3,000 per month for transport is reasonable.  I also find the sum of $3,000 per month for utilities including gas, water, electricity and telephone for a household of 4 persons to be reasonable based on all available evidence.  I note that according to the Husband, he also incurs $2,800 per month as utilities, which is not far off.

52. I am therefore of the view that the said children’s reasonable specific monthly expenses are $22,300 + the children’s share of general household expenses of $9,011. Thus, the total expenses for the children (excluding accommodation expenses) amount to $31,311 per month.

The apportionment of children’s specific expenses payable by the Husband

53. The Wife seeks periodic payment from the Husband for the said children’s specific monthly expenses in the sum of $20,000 which is approximately 55% of the monthly sum submitted by the Wife. Counsel for the Wife submitted in his closing submission that ‘bearing in mind the Husband makes almost double the income of the Wife, the special contribution made by the Wife and her mental disability which may have negative impact on her earning capacity, the Husband should be responsible for 55% of the children’s specific monthly expenses and the Wife would be responsible for 45%.

54. Counsel for Wife submitted to the Court a psychiatric report dated 28 March 2014 which states that the Wife was diagnosed with adjustment disorder and receiving psychological counselling.  However, she showed response to the treatment and her mental state was largely stable, despite reporting tremendous stress in handling the ongoing court procedures as well as her daughter’s academic performance. [Exhibit P2] 

55. I have considered all the circumstances including the discrepancy in earning capacity and the overall net available income of the parties, and am of the view that the Wife’s proposed apportionment of 55% and 45% is reasonable.

56. I am also of the view that both parties’ earning capacities and present salaries are adequate for their respective financial needs in their foreseeable future.  In the circumstances, I consider it fair and reasonable for the Husband to be responsible for 55% of the said children’s specific monthly expenses ie. $31,311 x 55% = $17,221.05 rounded up to $17,500 per month or $8,750 per child per month.

Whether the said periodic payments should be secured?

57. Counsel for the Wife submitted that the Court should consider making a lump sum payment for the maintenance and accommodation payments and/or such secured periodical payments to the satisfaction of the Court under Section 4(1)(b)(c) of the MPPO.  The Wife’s main concern is that the Husband works and stays regularly in the Mainland and therefore making future enforcement difficult.  Counsel for the Wife urged the Court to consider the fact that the Husband ceased all financial support to the family after separation in around July 2011.

58. I appreciate that any default in payment of periodic payments for the maintenance of the said children would have adverse impact on the said children.  I have seen and heard the Husband give evidence in Court and accept his explanation that the reason why he ceased payment after separation is because Botania Villa and Flat 56F was sold without his consent and the Wife did not account for the proceeds which he believed he was entitled to.  In his mind, the Wife had kept his share of the sale proceeds which he believed was sufficient to meet the needs of the said children’s welfare.  I believe that the Husband will comply with the maintenance order and therefore do not think it is necessary at this stage to make an order for secured periodical payment.

Whether a lump sum order for the accommodation expenses should be made and paid out of the net sale proceeds of the Matrimonial Property

59. Likewise, for the same reasons mentioned above, I do not consider it necessary to make any lump sum order for the maintenance and accommodation expenses.  I trust that both parties’ respective legal advisers would explain to them the consequences of not complying with a Court order for payment and the appropriate enforcement procedures as necessary.

60. I have considered all the circumstances and will not make any lump sum orders for maintenance or accommodation expenses to be deducted from the net sale proceeds of the Matrimonial Property as sought by the Wife. 

61. Furthermore, I note that based on the List of Assets of the parties under paragraph 31 above, the Wife’s entitlement to a pension estimated to be about $2.1 million in 2025 is significantly higher than that of the Husband’s MPF, which is estimated to be about $433,777 in 2032.  There being no specific claim by the Husband against the Wife’s pension at the trial, I am of the view that both parties should be entitled to keep their respective pensions.  The Wife, being the main carer of two young children, should be entitled to keep her pension to meet any unforeseen contingencies in the years ahead.

When should the Matrimonial Property be sold?

62. I now turn to the final issue of when the Matrimonial Property should be sold.  It is undisputed that the younger daughter will be promoted to Primary 6 this September and will face important internal assessment at the end of Primary 5 and both in mid-year and end of Primary 6 the results of which will determine the school she will be allocated to and whether she would be admitted to the same secondary school as her older sister.

63. Although the parties have come to an agreement that the Matrimonial Property will be sold with its net proceeds to be distributed between the parties in equal shares, the parties were unfortunately unable to agree to when the property should be sold.  

64. In gist, the Wife’s view is that maintaining the current living condition would be desirable to keep minimum change to the younger daughter so she can focus on her studies.  She therefore proposes that the sale should take place after 20 October 2015 or earliest by 31 August 2015, after the results of the Secondary School placement for the younger daughter are known.

65. Counsel for the Husband, submitted that the property should be sold this summer ie. by 31 August 2014. The Husband’s view is summarized in his Counsel’s closing submission as follows:-

i)  1.5 years from now is too long. There could be adverse contingencies in the property market during the 1.5 years, which may not be to the benefit of both parties if the property is to be sold 1.5 years later;

ii)  The purported sale of the property has been dragged on since the beginning of the divorce suit herein;

iii)  The children would be on summer vacation during July /August this year.  It would be the best time for the parents to arrange them to a new accommodation;

iv)   If the children need to move to a new accommodation in October 2015, the younger daughter would then need to face dual-changes of her life ie moving to secondary school and moving to a new accommodation at the same time.

66. In deciding when the Matrimonial Property should be sold, I will consider what is in the best interest of the said children which is of paramount importance.  I have considered arguments presented by both Counsels and there being no evidence of any immediate financial need, I agree with the Wife that maintaining status quo until the results of the secondary school placement is known would allow the younger daughter to focus on her studies and cause least disruption to the said children of the family.

67. I appreciate that the process of selling the matrimonial home, looking for and moving into an alternative accommodation may take months and understandably quite stressful for the family even under normal circumstances, let alone for parties going through divorce proceedings with two children, one of whom will have to take important assessments/exams which will determine her Secondary School placement.

68. I wish to add that the Husband may or may not be correct in predicting that the property market will decline and there being no expert evidence adduced to support his view that the overall housing supply in Tseung Kwan O district would increase and thereby result in lower property prices in 2015, I have to balance the Husband’s fear of possible economic loss against what is in my view, in the best interest of the said children.  I appreciate that the Husband may have experience in property investment but he also acknowledged that property prices can go up or down in this volatile market.   

Conclusion

69. To conclude, having regard to all the circumstances including the standard of living, education and lifestyle to which the said children are accustomed, I am of the view that the reasonable amount of specific monthly expenses of the said children is $22,300 and the said children’s share of general household expenses is $9,011 per month, and it is fair and reasonable for the Husband to be responsible for 55% of the children’s monthly expenses (excluding accommodation expenses) ie. $(22,300+9,011) x 55% = $17,221.05 rounded up to $17,500 per month or $8,750 per month per child.

70. For reasons stated in paragraphs 57 to 60 above, I am of the view that it is not necessary to make any secured periodical payments and/or lump sum orders in respect of the maintenance and accommodation payments to be deducted from the sale proceeds of the Matrimonial Property.

71. In respect of when the Matrimonial Property should be sold, I have considered what is in my view, in the best interest of the said children which is of paramount importance.  As mentioned in paragraphs 62 to 68 above, I have considered arguments presented by both Counsels and there being no evidence of any immediate financial need, I agree with the Wife that maintaining status quo until the results of the secondary school placement is known would allow the younger daughter to focus on her studies and cause least disruption to the said children of the family.

72. I therefore make an order that the Matrimonial Property be sold not earlier than 31 August 2015, with completion to take place not later than 31 October 2015 and the Wife and two children of the family be allowed to reside at the Matrimonial Property until delivery up of vacant possession for the purpose of the said sale.

73. In respect of the reimbursement of the mortgage instalments of the Matrimonial Property, the Wife seeks an order that the Husband do reimburse her for half of the share of the monthly mortgage of the Matrimonial Property in the sum of $6,000 per month (actual amount based on mortgage statements), dated back from July 2011 to the date of completion of the sale of the Matrimonial Property and such sum to be deducted from the Husband’s share of sale proceeds.

74. The Husband agrees in principle to reimburse the same but submitted that he should only reimburse $3,000 per month from July 2011 until August 2014 when the Wife’s Government housing subsidy ends, thereafter he will reimburse $6,000 per month to the date of completion.  I fail to see any merits in the Husband’s submission and will make an order as sought by the Wife in this respect.  I will thus order that the Husband do reimburse the Wife $6,000 per month from July 2011 to the date of completion.

75. There is no dispute that there should be a clean break between the parties.  The Husband and Wife have been married for about 12 years, they are both working, and according to the List of Assets under paragraph 31 above, the assets of both parties are roughly the same. Apart from the sale of property orders made herein, neither party will have any claim against the other in respect of their savings in banks, investments, pension, personal properties or other assets.

Costs

77. Lastly, on the question of costs, neither party is wholly successful, although the Wife has been more successful than not.  Having considered all the circumstances including the effort made by both parties to resolve some of the issues between them at the adjourned hearing, I will exercise my discretion and make an order that the Husband do be responsible for 50% of the Wife’s party and party costs, to be taxed if not agreed, with certificate for Counsel.  This is an order nisi which will be made absolute in 14 days’ time.

77.  In summary, my order is thus:-

1)  The Respondent shall pay periodical payments to the Petitioner for the maintenance of the two children of the family (excluding accommodation expenses) in the sum of HK$17,500 per month ie. $8,750 per month per child, the first payment to be made on the 1 May 2014 and thereafter to be paid on the 1st day of each succeeding month until the said children reach 21 years of age or ceases full time education whichever is the later ;

2)  (a) The Matrimonial Property be sold not earlier than 31  August 2015 with completion to take place no later than 31 October 2015 at the then prevailing market price to be agreed by the parties; failing agreement on the sale price, the parties shall jointly engage a surveyor to prepare a valuation report on the Matrimonial Property and the parties shall adopt the price stated in the said valuation report as the sale price; and

(b)Subject to paragraph 3 below, the net sale proceeds of the Matrimonial Property be divided between the parties in equal shares;

3)  The Respondent do reimburse the Petitioner for half of the share of the monthly mortgage instalments of the Matrimonial Property in the sum of $6,000 per month, dated back from July 2011 to the date of completion of the sale of the Matrimonial Property and such reimbursement shall be deducted from the Respondent’s share of the proceeds of sale of the Matrimonial Property;

4)  The Respondent shall pay a further sum of $9,000 per month to the Petitioner for the accommodation expenses of the two children of the family until the younger daughter reaches the age of 21 or ceases full time education whichever is later, commencing on the date of delivery up of vacant possession of the Matrimonial Property upon sale;

5)  The parties do procure the sale of the CPXX as soon as practicable at the prevailing market price and the net proceeds of sale to be distributed between the parties in equal shares;

6)  Upon compliance with paragraphs (2), (3) and (5) above, all claims which either party may have against the other for ancillary relief be dismissed;

7)  There be liberty to apply for the implementation of this order;

8)  The Respondent do pay 50% of the Petitioner’s party and party costs with certificate for Counsel, to be taxed if not agreed. This is an order nisi to be made absolute in 14 days’ time.

78. Last but not least, I wish to express my gratitude to Counsel for both parties for their assistance rendered to the court throughout the trial.