KAR also known as RA, KA v. NSL

FCMC 11862/2021

[2026] HKFC 101

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 11862 OF 2021

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________________________

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

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This Application

1.  This is the Petitioner wife’s (“W”)  application for ancillary relief against the Respondent husband (“H”); and also H’s application for variation of the maintenance pending suit.

2.  The trial took place over four days from 7^th to 10^th April 2025, W is represented, (and from February 2025 on legal aid), and H acts in person. 

Parties background

3.  The parties got married in India on XX July 2008, W moved to HK to live with H in October 2008. 

4.  W was aged 41 at the time of trial, she has been a housewife during the marriage.  She had also taught at a tutoring centre briefly and worked at H’s interior design and construction businesses from 2010 until April 2022, W says she was then constructively dismissed. 

5.  H was aged 47 at the time of the trial.  He is an airplane pilot ad employed as such since October 2006; he also owns an interior design company (“LH”)  and a construction company (“LHC”).

6.  The child of the family N was born on XX February 2011.  N is a special needs child, having been diagnosed with literacy and concentration challenges, and mild ADHD; she receives special accommodation at school.  W is her primary carer. 

Litigation History

7.  W filed an application for relocation with N to India on 2 June 2022, this matter was resolved by consent and made an order of Court on 22 September 2022.  But W says that with the complete lack of funds from H, she had been unable to move back to India.

8.  By the same Order on 22 September 2022, joint custody of N was granted to both parents, with care and control to W, and defined access to H.

9.  On application by W, and after a hearing before DDJ WY Ho, the MPS Order dated 20 October 2023 grants

a.  A monthly sum of $19,000 MPS to W from 20 September 2022

b.  A sum of $17,000 interim maintenance for N from 20 September 2022

c.  Further monthly sum of $17,000 as litigation funding for W from date of Order to FDR hearing or until further Order

H is also to be responsible for paying:

i.  Mortgage payment for former matrimonial home (“FMH”)

ii.  FMH utilities

iii. FMH management fees

iv. N’s school fees

v.  Domestic helper fee of $4,000  

10.  H filed an application for variation to this Order on 7 November 2023, but on being asked what change of circumstances he is alleging 18 days after the MPS Order, he sought to and was granted leave to withdraw this at the direction hearing on 29 May 2024.

11.  When H failed to pay maintenance and legal costs provision pursuant to the October 2023 Order, W took out an application for an Attachment of Income (“AOI”)  Order in December 2023, but this could only apply to N’s interim maintenance.

H’s Variation Application 2025

12.  H filed a second variation of maintenance application on 11 March 2025.  This was less than one month before the trial.

13.  By then, the Court has ordered H to file his narrative affirmation on or before 14 March 2025, but H did not comply, this was despite the Court making an Unless Order which states:

“ … Unless this is done on or before 14 March 2025, they shall be debarred from filing their narrative affidavit with necessary adverse inference to be drawn.”

Instead, H chose to file this variation application with his supporting affirmation on 11 March 2025.  This application is being heard at the same time as this ancillary relief trial.

14.  W filed her opposition on 26 March 2025.

15.  The basis of a variation application rests on the finding of material change of circumstances; whereupon the circumstances of the parties will be considered de novo.  In reading his supporting affidavit, H’s variation application rests on the following bases:

a.  MPS decision was based on outdated income data.

b.  That his employer airline restructuring plans in 2020-2021 has not been taken into account.

c.  Salary cut, elimination of housing allowance and reduced  provident fund contribution were formalised in his employer airline company’s restructuring letter of October 2020.

d.  His flying hours had drastically decreased in early 2025.

e.  W’s expenses too high, the maintenance order is not sustainable. 

f.  W has earning capacity of $20,000 part time and $45,000 full time.

16.  W’s submission is that there has been no change of circumstances, and H has made no submission on his own application for this hearing.  W’s and N’s maintenance will be considered in this judgment.

Parties Evidence

17.  The parties’ evidence before the Court are as follows:

Date	Petitioner W	Respondent
7.2.2022	Form E	Form E
20.9.2022	2nd Affirmation
13.10.2022	1st Answer to Questionnaire
12.12.2022		1st Answer to Questionnaire
24.3.2023	2nd Form E
27.4.2023		2nd Form E
7.11.2023		1st Affirmation (1st variation of maintenance (“VOM”)  application)
30.11.2023	2nd Questionnaire
29.12.2023	4th Affirmation (AOI)
9.2.2024	6th Affirmation (Opposing VOM)
3.4.2024		2nd Affirmation (Reply on VOM)
16.12.2024		2nd Answer to Questionnaire (˃1 year late)
15.1.2025		3rd Form E
14.2.2025	3rd Form E
18.2.2025	11th Affirmation (Leave to enforce arrears)
21.2.2025	3rd Questionnaire
7.3.2025		3rd Answer to Questionnaire
11.3.2025		4th Affirmation (2nd VOM application)
14.3.2025	12th Affirmation (Narrative Affirmation)
26.3.2025	13th Affirmation (Oppose 2nd VOM application)

The Applicable Law & Legal Principles

Legal Principles with regard to determination of ancillary relief claims

18.  Section 7 of the Matrimonial Proceedings and Property Ordinance (“MPPO”), Cap 192 sets out the matters that the court must have regard to when making orders for ancillary relief:

“(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.

19.  The Court of Final Appeal in its landmark judgment of LKW v DD [2010] 13 HKCFAR 537 has laid down a 5-step approach in assessing the division of the parties’ matrimonial assets:

1.  The ascertainment of the financial resources of each of the parties calculated as at the date of the hearing (§§71 to 73);

2.  The assessment of the parties’ financial needs.  If the total resources are not enough to meet the parties’ needs, the s.7 exercise should stop at this step and there is no room to apply any sharing principle (§§74 to 79);

3.  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 (§§80 to 82);

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

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

20.  The above approach is to be considered against 4 guiding principles, namely:

(i)  objective of fairness,

(ii)  rejection of sex or role discrimination,

(iii)  yardstick of equal division, and

(iv)  rejection of minute retrospective investigation.

21.  The principles are trite and will be applied to the issues in this case hereinbelow.  

Legal principles with regard to failure to disclose financial information

22.  On this, I turn to the case of Moher v Moher[2019] EWCA Civ 1482; [2020] 2 WLR 89; [2020] 1 FLR. 225; [2019] 3 FCR. 244, which was quoted in the case of CCYL v CCSR [2022] HKFC 238 by HHJ I Wong at paragraph 86 therein: 

86.   … English Court of Appeal held that in the event of non-disclosure of a party's financial resources in a financial remedies case, the court was not obliged to give a precise figure or bracket for the undisclosed resources before making an order. Instead, it should: (i)  seek to determine the extent of the undisclosed resources; (ii)  draw such adverse inferences as were justified; and (iii)  where appropriate, infer that resources were sufficient that the proposed award represented a fair outcome.  Moylan LJ said,

86. My broad conclusions as to the approach the court should take when dealing with non-disclosure are as follows. They are broad because, as I have sought to emphasise, non-disclosure can take a variety of forms and arise in a variety of circumstances from the very general to the very specific. My remarks are focused on the former, namely a broad failure to comply with the disclosure obligations in respect of a party's financial resources, rather than the latter.

87. (i)  It is clearly appropriate that generally, as required by section 25, the court should seek to determine the extent of the financial resources of the non-disclosing party.

88. (ii)  When undertaking this task the court will, obviously, be entitled to draw such adverse inferences as are justified having regard to the nature and extent of the party's failure to engage properly with the proceedings. However, this does not require the court to engage in a disproportionate enquiry. Nor, as Lord Sumption JSC said, should the court “engage in pure speculation”. As Otton LJ said in Baker v Baker [1995] 2 FLR 829, inferences must be “properly drawn and reasonable”. This was reiterated by Baroness Hale of Richmond JSC in Prest v Prest [2013] 2 AC 415, para 85:

“the court is entitled to draw such inferences as can properly be drawn from all the available material, including what has been disclosed, judicial experience of what is likely to be being concealed and the inherent probabilities, in deciding what the facts are.”

89. (iii)  This does not mean, contrary to Mr Molyneux's submission, that the court is required to make a specific determination either as to a figure or a bracket. There will be cases where this exercise will not be possible because the manner in which a party has failed to comply with their disclosure obligations means that the court is “unable to quantify the extent of his undisclosed resources”, to repeat what Wilson LJ said in Behzadi v Behzadi [2009] 2 FLR 649.

90. (iv)  How does this fit within the application of the principles of need and sharing? The answer, in my view, is that, when faced with uncertainty consequent on one party's non-disclosure and when considering what Baroness Hale and Lord Sumption JJSC called “the inherent probabilities” the court is entitled, in appropriate cases, to infer that the resources are sufficient or are such that the proposed award does represent a fair outcome. This is, effectively, what Munby J did in both Al-Khatib v Masry [2002] 1 FLR 1053 and Ben Hashem v Al Shayif [2009] 1 FLR 115 and, in my view, it is a legitimate approach. In that respect I would not endorse what Mostyn J said in NG v SG [2012] 1 FLR 1211, para 16(vii).

91. This approach is both necessary and justified to limit the scope for, what Butler-Sloss LJ accepted could otherwise be, a “cheat's charter”. As Thorpe J said in F v F [1994] 1 FLR 359, although not the court's intention, better an order which may be unfair to the non-disclosing party than an order which is unfair to the other party. This does not mean, as Mostyn J said in NG v SG, at para 7, that the court should jump to conclusions as to the extent of the undisclosed wealth simply because of some non-disclosure. It reflects, as he said at para 16(viii), that the court must be astute to ensure that the non-discloser does not obtain a better outcome than that which would have been ordered if they had complied with their disclosure obligations. (emphasis added)

23.  It has been said where a party has been guilty of not making full disclosure, he could not complain if uncertainties were determined against him:  L v C [2007] 3 HKLRD 819, at paragraph 191(2). And for completeness, in the case of NG v SG (Appeal: Non-Disclosure)  2011 EWHC 3270 (Fam), [2012] 1 FLR 1211, paragraph 16 (viii)  reads as follow:

“The Court must be astute to ensure that a non-discloser should not be able to procure a result from his non-disclosure better than that which would be ordered if the truth were told. If the result is an order that is unfair to the non-discloser it is better that than that the Court should be drawn to into making an order that is unfair to the Claimant.”

Issues

24.  The parties Agreed / Disputed List of Issues come to 40 paragraphs, 19 of which was agreed, with H putting forward 21 more which are disputed by W.

25.  Following our statutory provisions and the well-trodden principles of LKW v DD; it is my determination that the following additional specific issues fall to be determined :

a.  Regarding the UK Property Q, what weight should be placed on the MOU produced by the H just 6 weeks before trial

b.  The value of the loans owed to H by his two companies

c.  H’s loan from his family; his alleged debt collection based on his personal guarantee, and a personal instalment loan

d.  W’s loan from her family

26.  There are issues on the list which include values of H’s bank accounts and securities account.  To the extent that the amounts in the Agreed / Disputed Schedule of Assets & Liabilities (the “A & L Schedule”)  are backed by bank statements before the Court and referred to me, those should be the value that will be adopted by this Court.

27.  Other issues on this list which are not covered above are either to be considered under the aforesaid legal principles, or irrelevant.

W’s Case

28.  W says that during the marriage, she had access to H’s salary and use of a credit card.  She had also worked in H’s two companies and took a salary from them. 

29.  It is W’s case that they live in a 700+ square feet 3-bedroom apartment, enjoyed a comfortable lifestyle with domestic helper, regular dining out and frequent travels.

30.  W says that there had been a number of instances of failure to give full and proper disclosure, particularly those pertaining to H’s income; and that some documents H produced might have been fabricated.

31.  W says that H had failed to comply with a Court Order to pay MPS, interim maintenance for N, and legal costs provisions, forcing her to take loans from her family members.

W’s Open Proposal

32.  W asks for a clean break from H.

33.  Based on W’s assessment of the matrimonial pot, the net value would be $11,457,723[1], with some adjustments made during the trial.

34.  W asks for 50% sharing of the matrimonial pot, hence $5,728,861.  With the negative value of $3,600,728 on her side of the balance sheet, the equalisation amount would be $9,329,589.

35.  W asks for this amount to come from sale of the FMH (value determined to be $7,353,625)  and for the balance by instalments over three years.

36.  As for N, she asks for H to bear all of N’s expenses due to the disparity in their respective income / earning capacity, hence:

a.  N’s share of W’s general expense = $30,541

b.  N’s direct expenses = $21,550

The total is $52,091.

H’s case

37.  As H has failed to comply with Orders to file a Narrative Affidavit, nor prepared opening or closing submissions, his case could only be gleaned from his position on some of the values of the assets and commentaries, and some of his cross examination of W.

38.  Broadly speaking, he says:

a.  His pay from his airline company is reduced, he has flown less hours from before therefore he earns less salary.

b.  His companies are losing money.

c.  He has no money to pay for maintenance, and he has to take out loans to cover his own shortfalls.

H’s Open Proposal

39.  H has failed to comply with the Order of Court dated 21 February 2025 at the PTR to file his open proposal on or before 31 March 2025.  The Court is therefore also unaware of his position in this regard. 

40.  However, from his oral opening, he said that his average primary income is $80,000, and therefore he will pay half to W and N, and as W has a earning capacity of $15,000, he offers to pay her $25,000 for both. 

The matrimonial pot represented by parties for the trial

41.  The following table is adopted from the W’s opening submission of the parties’ respective positions, and also incorporates the concessions made by W to H’s numbers at trial.

		Petitioner W	Respondent H
1	Real Property: FMH -less mortgage	14,100,000 -6,717,143 = 7,382,857	13,900,000 -6,717,143 = 7,182,857
2	Real Property : Q -less mortgage	2,861,400 -1,968,562 = 892,838	2,289,120 -1,968,562 = 320,557
2	W’s Bank accounts	34,105	34,105
4	H’s bank accounts -BOC 4446 -HSB 7307 -HSBC UK -SCB SUB-TOTAL	117,627.39 90,136 43,402 48,372 (agreed day 4) 299,537	55,751 NIL 12,432 48,372 (agreed day 4) 116,555
5	Joint bank account	-5,219	-5,219
6	Company S/H -LH -LHC	NIL NIL (agreed)	NIL NIL (agreed)
7	H’s Investments -FUTU -Sofi SUB-TOTAL	40,553 52,248 92,801	40,553 52,248 92,801
8	Debts owed to H -From LH -From LHC SUB-TOTAL	3,551,336 10,000 3,561,336	NIL (Irrecoverable)
9	Personal valuable -H’s Watch	7,650 (agreed day 4)	7,650
10	W’s MPF (applied 30% liquidity discount)	153,091 -45,927 = 107,164	107,164
17	H’s MPF (applied 30% liquidity discount)	4,883,889 -1,465,166 = 3,418,723
NIL
18	TOTAL ASSETS	15,791,792	7,856,470
7	LIABILITIES W’s Liabilities -various credit cards -legal fees -money borrowed from family SUB-TOTAL	290,989 2,151,006 1,300,000   = 3,741,995	Not disputed
	H’s Liabilities -Credit Card -Parent’s Loan -Money owed to LHC -Debt -Personal Instalment Loan -Legal Advice -Civil Claim for misappropriate of assets -Legal Fees owed to SW SUB-TOTAL	747,263 ) )  Disputed by W ) ) ) ) )   26,900 (agreed day 4) 774,163	747,263 649,235 10,000 4,430,448 435,000 515,775 3,125,725 26,900 9,940,346
8	NET ASSETS	11,275,634	-2,083,876

Discussion

H’s engagement in these proceedings

42.  It is important to set out first and foremost the way H has chosen to participate in these proceedings.

43.  H has failed to comply with a number of Orders (these are set out in detail below at paragraph 169), there were occasions when he has chosen to do it in his own good time, or not produced documents as ordered by court.

44.  Specifically, he had asked for extension to file his answers to W’s second questionnaire for 3 times, and only produced his answers more than one year after the questions were filed.

45.  He has failed to file his narrative affidavit which has rendered it extremely difficult for the Court to have a full grasp of his case, as well as a lack of reference to any supporting information to what he alleges.

46.  He has failed to file his opening submission, which again makes it an almost impossible task to try to piece together his arguments and the relevant documents in the bundles which could have supported them. 

47.  On this, I make reference to the Judgment of our former Chief Justice G Ma, as a Recorder then, in the case of Yau Chiu Wah v Gold Chief Investment Limited and China Broadband Corporation Limited HCA908/2001, where he said that it is not the role of the Court to search through papers to discover for itself the material facts.  While that case involves an exparte application, the principle is still trite and applicable:

“… this is yet another example of the “needle in a haystack” point. In the same way that a court cannot be expected to search through exhibits in order to discover material facts, so the court is equally not to be expected to have to sift through intricate legal arguments or facts in order to achieve this end.” 

48.  There is a total of 27 bundles before me at this trial, of which 23 are exhibits bundle.

49.  H was informed at trial (more than once)  that he had to prove his case and draw the Court’s attention to where the evidence is in the bundles; and that the Court could not be expected to go through all the documents to look it up for him.  He was also informed that he was given the opportunities to make his case known but he has chosen not to take that up.  I shall also repeat here that at the PTR dated 21 February 2025, he was ordered to file his narrative affidavit on or before 14 March 2025, he failed to do so and filed his 2^nd variation application instead on 11 March 2025.  Despite all the indications I gave at trial as to the consequence of his lack of submission, and also when I explained to him about the closing submission at the end, I had specifically told him that I expect cross references, he had still opted not to make good the lack of information and supporting evidence. H did not file a closing submission.

50.  H also attempted to introduce running numbers on his various accounts, saying that since the agreed A & L Schedule, money had been used from his accounts to pay for one item or another of his expenses.  He was also informed that the Court would base its assessment on the numbers in the A & L Schedule which can be cross referenced to statements produced as evidence,  subsequent reference to new balances would not be taken into account unless supported by statements and conceded by W.

51.  Doing the best I can, the following discussion and analysis are made against this factual backdrop.

The Matrimonial Pot

H’s Assets

Former Matrimonial Home (“FMH”)

52.  The FMH is owned by H, SJE was appointed at the Case Management Hearing by my Order of 20 February 2024.  The SJE’s report was dated 3 February 2025 and filed on 7 February 2025, citing the value as $14.1 million.

53.  According to the A & L Schedule, H says that the value should be $13,990,000, I have not been taken to look at supporting documents for his proposed number.

54.  At the PTR on 21 February 2025, the following orders were given:

“3. The parties may write to the SJE with additional or clarifying questions (limited to 2 pages)  not later than 5 days upon receipt of the valuation reports.

4.  If supplemental valuation reports are required, such supplemental valuation report shall be provided on or before 12^th March 2025 and the cost of the supplemental valuation reports shall be borne by the Respondent in the first instance.”

55.  W says that H did not contact the SJE until 14 days after the PTR, his letter to the SJE was 4 pages long, and “in form of declaratory statement rather than clarifying questions”.  Once gain, H failed to comply with the timeline and directions in an Order. 

56.  H also wrote to ask the SJE to attend the hearing instead of taking out a subpoena.  There is no supplemental report before the Court.

57.  In the absence of a submission on H’s case, and the lack of further information from trial, I was assisted by W’s counsel on three issues raised by H in prior correspondence; although H did not raise this, nor provide reference or elaboration:

(i)  That the open kitchen and gas cooker may be a subject matter for enforcement but there is no evidence of such action and therefore disregarded by the SJE;

(ii)  That the balcony is not illegal and H’s allegation that it is an illegal structure which could impact on the property value is not supported;  

(iii)  H complained that a comparable property sale was excluded, the SJE says it was due to its “highest adjusted effective unit rate”.  W’s counsel says that should H’s complaint be taken into account, the valuation of the FMH would be even higher.

58.  In the circumstances, and with lack of argument, information or supporting documentation for consideration from H, I accept the valuation from the SJE on the FMH as $14,100,000.

H’s UK Property (“Q”)

59.  The SJE Report was also ordered on 20 February 2024, the SJE provided a report on 23 February 2025 (filed on 24 February 2025), citing the value as GBP285,000, translated into $2,861,400 according to W’s counsel’s submission.

60.  As with the FMH, H filed his request for supplemental report late on 15 March 2025.  It was 20 days after receipt of the report instead of 5 days, and 3 days passed the deadline for a supplemental report to be filed.  W says H listed some “established facts”, which are disputed; and H also failed to bring in the SJE for cross examination as the latter has declined his request for lack of agreement on the tenancy agreement.  No subpoena was taken out.  No supplemental report was produced.  

61.  While there is a Tenancy Agreement to this property, dated 23 July 2008 and produced by H with his first Answer to W’s questionnaire on 12 December 2022; the main issue in this property was a Memorandum of Understanding dated 20 July 2008 (the “MOU”).

62.  At this point, I shall quote hereunder the sequence of events from the W’s counsel’s submission relating to the production of the MOU and the interaction with the SJE:

a.  H did not provide it with his Forms E or Answers. H did not provide it with his 7 February 2022 Form E, at which time he was represented by specialist family solicitors. H was asked for the tenancy in W’s 1^st Questionnaire [H’s 1^st Ans: A2/264/Q.20]. He did not provide the MoU with his 1^st Answers on 12 December 2022, but only the 23 July 2008 Tenancy Agreement (the “T/A”)  at [B5/1421]. Nor was the MoU provided with his 2^nd or 3^rd Forms E.

b.  H did not provide it to the SJE at the time of the letter of instructions or when given the opportunity prior to his receipt of the signed report on 23 February 2025:

i.  On 23 January 2025, the SJE asked parties to confirm there was an “appropriate assured shorthold tenancy agreement (AST)  and the term / duration of that agreement” [Email: B21/6620].

ii.  On 6 February 2025, W’s solicitors then emailed asking for H to provide the requested confirmation [Email: B21/6625].

iii.  On 7 February 2025, H claimed for the first time that “the agreement has evolved into a long-term arrangement… As a result they have accrued certain rights that make the tenancy more secure than a typical AST…” [Email: B21/6626]. He did not provide the MoU.

iv.  On 20 February 2025, the SJE replied noting that “The tenancy agreement has not however been seen…”, and explaining that without confirmation on the type of tenancy, he would proceed on the basis that vacant possession could be obtained with 2 months’ notice [Emai: B21/6629].

v.  The same day, W’s solicitors replied providing the SJE with the T/A that had previously been supplied with H’s 1^st Answers [Email: B21/6630]. H was copied on this email.

vi.  Also that same day, H replied to the SJE alleging that he had granted the tenants “a 3 year notice-arrangement with rent freeze” [Email: B21/6638]. H still did not provide the MoU.

vii.  It was only on 26 February 2025, 3 days after the signed SJE Report had been provided (and 2 days after it was filed), that H provided the MoU for the first time [Email: B21/6661]. That is also confirmed by the SJE [Letter: C1/78].

viii.  On 28 February 2025, the SJE pointed out that “This information should have been provided at the outset of the instruction” [Email: B21/6689].

63.  I will also add to this sequence of events: that also on 20 February 2025, the SJE had said specifically that he aimed to finish the valuation report on that day subject to a question regarding scaffolding at the building, and H did respond to him on the scaffolding on the same day.

64.  The finalized report was sent to the parties on 23 February 2025, to which the H on 24 February 2025 in his email to the SJE strangely referred to as the “preliminary draft report”, which it was not.  H says the SJE have missed certain factors including that the tenants are in a “Long-term Tenancy with Enhanced Protection”, and citing some terms of this alleged arrangement.  At this point, still no MOU was produced.

65.  On 25 February, the SJE wrote back with several questions, asking specifics regarding the alleged terms, and also said “I cannot move forward with the valuation until the above matters are confirmed and both parties are in agreement regarding the terms of the tenancy agreement if there is no documented evidence.” There follows a flurry of emails from H to the SJE, and on 26 February 2025, he said that there was a binding MOU.  On 26 February, the SJE stated, while acknowledging that the alleged additional provisions are likely to have some impact on value if enforceable, no documented evidence has been provided to confirm these details, and he noted that W does not agree with these allegations.  SJE says that it is not the role of the expert witness to decide the terms of the tenancy and the valuation was based on the document provided to him.

66.  On 26 February 2025 at 6:05 pm, H wrote to the SJE and said that “critical information was missed”, and the report was “incomplete without this critical evidence and supporting documentation”.  At 6:50 pm the same day, he produced the MOU and says that the current valuation is invalid.

67.  H relied on this MOU to say that the tenant has accrued certain rights after living there for more than 17 years, as a “long-term sitting tenant”; and that the tenant could not be removed from the property at the usual two months’ notice, which was one of the bases of the valuation of the property when considering timing of delivery of vacant possession.

68.  H first produced the Tenancy Agreement dated 23 July 2008 with his First Answer to Questionnaire in December 2022, yet he failed to produce this purportedly important MOU, signed three days prior to the Tenancy Agreement, until more than three years afterwards on 26 February 2025, and less than 6 weeks before this trial.

69.  This MOU was titled “Memorandum of Understanding (MoU)  & Supplemental Tenancy Agreement”, and states that it “formalize terms superseding any tenancy agreement”.  Given that the Tenancy Agreement produced by H was dated 3 days after this MOU, it is unclear as to what this MOU seeks to supersede.  I also notice that this MOU was signed by H himself while the Tenancy Agreement was signed by someone else, a VN on behalf of the Landlord.

70.  W’s counsel goes on to put forward the following arguments:

a.  That H did not provide any reasonable excuse to his failure to provide the MOU before 26 February 2025.  The Court is reminded that H’s retort under cross examination was that he was never asked for it.

b.  H did not provide any correspondences with the tenant on negotiating this MOU or making references to it.  H suggests during cross examination that the tenant could be contacted by phone for verification, as he does not have the tenant’s email.  

c.  W’s counsel says H and tenant could not have both signed the MOU on 20 July 2008.  H’s passport shows that he was in Hyderabad, India from 18 – 26 July 2008, H and W was married on XX July 2008 (incidentally the date of the Tenancy Agreement).

d.  W’s counsel says that the letting agent is unaware of the MOU, as the latter’s email says that the tenant is on a “rolling periodic”.  H said the agent does not need to have it as they were only hired to manage the property, W argues that this could impact the rental arrangement.

e.  W’s counsel also says that H did not observe the terms of the MOU which at Clause 2.1 provides a “Rent Freeze” coinciding with the  “36 months renewal”.  However, from statements and email provided, the rent was increased from £1145 in October 2023 to £1245 in November 2023 and then £1310 by October 2024.  W argues there is clearly no 3 months rent freeze; when asked under cross examination, H said it is at his discretion.

71.  H has failed to disclose the MOU for more than three years for no good reason.  This is counting back to when he first produced the Tenancy Agreement in December 2022; and then the filing of three Form Es, the MoU was never produced.  He was present at the hearing when the SJE was being appointed, he paid for the SJE, he was aware of the inspection of the property in mid-January 2025, he was aware of the extension of time for the SJE to produce his report granted in February 2025.  The terms of the MOU were belatedly mentioned by him but not the document itself, he did not respond to the SJE’s request for the MOU until three days after the SJE report was finalized.  The MOU bearing his signature was stated to be signed on a day when he was not in the UK, but instead getting married in India.  If this document is so “critical” as he claims, it is not accepted that his disclosure on this is so lacking.

72.  Based on the above, I find that no weight should be placed on this MOU.  I have no revised valuation of the UK property, I accept the SJE’s report and that it was based on the information available and produced to him at the relevant time.  The amount to be attributed to this property is as per the report, which is $2,861,400. 

H’s MPF

73.  H declares that he has an MPF of $4,883,889 in his updated Form E.  There is a screenshot of a webpage of the MPF held with HSBC dated January 2025.   

74.  For completeness, it is best to record H’s position on this sum in the A & L Schedule:

“Not liquidatable. Termination and rehire with subsequent employment and seniority reset. Retirement fund scheme does not support concept of liquidation discount. Final warning letter on file with high absence rate letter (due prolonged proceedings)  No fund would be available until after 65 if not dismissed in interim, including disciplinary action, including absent rate, work performance or others. Liquidity discount is unsupported by Hong Kong pension regulation, which do not recognise such discount for ORSO schemes)”

75.  To respond to some of these contentions:

a.  The Court will apply illiquidity discount to the sum precisely because it is recognised that the sum is not liquid.  H seems to be unaware that the discount actually reduces the amount of MPF to be placed into the matrimonial pot.

b.  I have no reference to H’s allegation that the illiquidity discount is not supported by ORSO schemes and Hong Kong Pension regulation.

c.  H has not brought my attention to anything in the evidence to show that these funds would not be available to him if he is dismissed in the interim.  In any event, there is nothing in evidence that H is at risk of being dismissed going forward.

76.  On the issue of illiquidity discount, it is well established that in considering the role of a retirement fund in a matrimonial pot, an illiquidity discount could be applied if the pension will not be available to the relevant party immediately.  I rely on HHJ I Wong’s case of SSLT v SMFC [2019] HKFC 250 (para 44-48)  and LWF v WST [2021] HKFC 164 (para 49-50)  which laid down the principles succinctly :

“44. It is not in dispute that the pensions and the retirement accounts could only be realized upon the parties’ retirement, probably when they reach the age of 65. Both are now 43 years old; there are still more than two decades to go before the money could actually goes into their pockets. It must be correct that a distinction must be drawn between an asset, which can be realized for cash and thus freely available and one, that is not realisable and non-transferrable. Regardless of whether it is in the form of a provident fund or a pension (ie a lump sum or an income stream), the money that the parties would receive on retirement is not an available capital asset….”

77.  The dispute on this item comes down to the amount of this MPF to be taken into account:

a.  the duration of marriage, and

b.  the discount is to be applied due to the time when the MPF will be available to H. 

78.  With regard to duration, looking at H’s latest Form E, he says that he has worked as a pilot since 16 October 2006.  The date of marriage was July 2008 and the date of Petition was 22 November 2021; this is, for all intent and purposes, a long marriage of more than13 years.  Applying this to the time when H has been working as a pilot, this would be 13.33 / 15 = 88.86%

79.  As for accessibility to the retirement funds, H is now 48 years of age, the retirement fund shall be available when he turns 65, which is 17 years away.

80.  Relying on the Court of Appeal case of Chan v Chung [2023] HKCA 560, which involved a marriage of just over 10 years, and where the accessibility to the MPF is five and a half years away;  the Court of Appeal adopted a broad brush approach taking into account the long marriage and the time to collection of the retirement fund and says as follows at paragraph 14:

“…This is because the longer the marriage, the parties’ interdependence grows, it becomes harder and harder to disentangle what came from where. When the court exercises its discretion, the principal consideration should be fairness. The court ought not take time to distinguish whether it is matrimonial property or not. Judge Pang had overlooked this important factor as he only awarded a ratio of one third. Taking into account the overall circumstances of the case, including the length of the marriage and the husband could only get his pension in five and a half years, we are of the view that it is appropriate to treat 80% of the pension as matrimonial property .” (emphasis added)

81.  I recognise that the Court of Appeal case has taken a broad brush approach and incorporated the illiquidity discount into the overall percentage applied to the husband’s MPF in that case.  Using the 80% from the set of facts in the CA case, and applying the principles enunciated by Cheung JA, I exercise my discretion to apply 66.66% (2/3)  of the H’s MPF towards the matrimonial pot.  This having considered the duration of marriage of 13 years, and also H’s accessibility to the funds to be around 17 years.  Therefore, $4,883,889 x 66.66% = $3,255,600 will be applied to the matrimonial pot.

H’s other assets: Loans by H to LC and LHC

82.  W says that pursuant to documents produced by H, LH owes him at least $3,551,336.

83.  W says H provided a loan agreement dated 1 December 2018  wherein H as shareholder of LH agreed to lend $3 Million to the company.  Documentary evidence also shows (1)  a transfer of $2 Million from the parties joint account to LH bank account on 3 December 2018 signed by H, and (2)  a transfer of $1 Million from the joint account to LH bank account on 2 March (or May)  2019 signed by W.

84.  I notice that according to the SJE report, he only records a liability to the shareholder of LH of $2M, but the SJE’s view was based on a letter from H’s previous accountant wherein they confessed to “funds of approximately HK2,000,000 were incorrectly recorded in the FS as service income of the Company instead of loan from the sole shareholder”, (ie H).  This in my view does not change the fact that the abovementioned loan was for $3 Million, and such amounts were transferred according to bank documents.

85.  There was another sum of $100,000 transferred from the joint account to LH bank account on 6 March 2019.  In his 3^rd Answer to W’s questionnaire, H acknowledges that this is part of the shareholder’s loan.

86.  H confirmed that there was a third sum of $451,336 recorded as a loan to LH in November 2024.

87.  The two loans of $3 Million and $451,336 also appeared in a document titled “2025 update and strategic plan” dated 8 January 2025 under the letter head of LH, both loans were recorded as “Shareholders Loan sand Liabilities”.  Given the date of this document, it should be safe to say that it is  sourced from H.

88.  In the A & L Schedule, H says that these loans to LH is not “recoupable and mandatory repayment agreement not in place”, He says the companies are “insolvable with no liquidity, liabilities exceed its assets”.

89.  W says that in cross examination, H acknowledged that these sums are outstanding and owing, but said that if the company is unable to pay, he as shareholder will forego the loan.  But this has not yet happened.

90.  As for LHC, W says $10,000 is owed by LHC to H, as this was the sum he declared to be owing to him in both his second and third Form E.  Under cross examination, he turned around and said that this was actually the sum that he owed to LHC for payment of share capital.  W submits that this is not credible as LHC’s 2023 draft AFS shows the shares as “Issued and fully paid”.  I agree.

91.  The SJE did say that the two companies financial condition is poor;  but W contends that H do intends to continue operating the companies as a going concern.  On this she relies on two facts:

a.  H had just 5 months prior to the trial injected $451,336 into LH.

b.  The companies were still pitching for projects in January and February 2025.

While part of the H’s case appears to be how difficult businesses had been, I tend to agree with W’s submission.  As it makes no sense for the H to be throwing good money after bad, nor for him to be potentially starting new projects if he plans to be winding down, or expect businesses to be continuously unprofitable.  H has not put forward a case that his businesses will not be operating.

92.  On H’s own evidence and lack of information to the contrary, I find  that these are loans outstanding and due to him, and constitute part of his assets.

H’s Liabilities

H’s personal guarantee for debts of LC

93.  H claims that he owes a contractor Mr C $4.4 Million.  In the A & L Schedule, H’s comment reads: “Active debt collection action w/ personal guarantee.  With signed debt recognition as disclosed during SJE investigation as a personal”.  H also says there is “SJE letter – SH personally liable including debt inheritage.”

94.  H makes no reference to anything in the bundles which supports his commentary.  

95.  What may be relevant is a document cited as “Entrustment Agreement” dated 7 September 2021 under the letterhead of a United Credit Management Ltd (“UCM letter”).  I have no context to this document except this was produced in W’s 12^th Affidavit citing it as one of the many documents provided by H to the Company SJE in early 2025.  The Entrustment Agreement has a principal named F L Engineering Company of which the contact person was presumably Mr C; and the debtor was LH, with H as contact person, with the subject matter of a debt of $4,430,448.  It also described the debt as occurring between 2015 to 2021.

96.  It is with W’s counsel assistance that I am referred to the H’s third answer dated 7 March 2025 which mentioned “active debt collection agencies with personal liability for company debts” and “As a shareholder & person guarantor of the company’s debts, I am being actively pursued by debt collection agencies unless debts are recognised.”. At least 135 pages were exhibited to this 3^rd answer but has no specific cross reference to the answers given.  

97.  W’s counsel says that the Entrustment Agreement was never produced in any of H’s Form Es.  Not is there any documentary evidence of any personal guarantee.

98.  W’s solicitors wrote to H on 24 February 2025 referring to the document given to the SJE, asking for (a)  correspondence with Mr C concerning the alleged debt (b)  Correspondence with UCM (c)  explanation as to how he came to obtain the Entrustment Agreement and (d)  a breakdown of the alleged debt with invoices and demands.  H did not respond to this letter, and instead under cross examination referred to a “Dropbox link” with “about 500 plus document shared with the SJE”.  This Court is not aware nor was I referred to any of these documents; and I have not been told if these documents which purport to answer W’s question is in evidence or not.  

99.  It is also important to turn to the SJE’s report in this regard:

a.  At para 2.21, the SJE observed that LH has changed its auditors frequently, notably 4 firms over 6 years.

b.  At para 2.22, the SJE queried “why did none of these auditors question the treatment of this payable in their audit reports? Why did the Respondent not raise this request when XXX CPA restated the financial statements” .

c.  At para 2.23, the SJE recorded that Mr C was a subcontractor to LH, and that the total subcontracting fee of Mr C disclosed in LH tax filing was $8.27M in FY 2019 and $4.07 in FY 2020.

d.  The SJE there says there could be three possible scenarios:

“i. If both the subcontracting costs and the payable were properly recorded, why was the payable not reflected in the latest financial statements? The only possible explanation is that this payable had already been settled. This would contradict the Respondent’s representations.

ii. If either the subcontracting costs or the payable was properly recorded, …., why did the auditors not identify this issue?

iii.  If neither C’s subcontracting costs nor payable is properly recorded, this implies an off-the-book liability of $4.4 million. However, if the payable still exists, why has C not requested repayment?”

e.  At para 2.28, the SJE says  “I have not been provided with sufficient information to answer these questions, nor have I been given the role of rectifying the accounting records. Given the interpretation in paragraphs [above], I have not factored this $4.4million potential liability into my valuation.”

100.  Further, W’s counsel also argues that if this debt had been incurred, it would go back to more than 10 or 11 years, and some if not all would have been time barred under the Limitation Ordinance.

101.  I accept W’s submission and also the SJE’s analysis, I have no documents nor reference to this alleged personal guarantee of this debt of $4.4 Million, hence will not be taking this liability into account.  

Loan from H’s Family

102.  H has alleged that there is a “Parents Loan” of $649,235, but this only appeared in his second Form E dated 27 April 2023 and not before; the supporting document appears to be HSB account statements showing three transfers on 30 and 31 December 2020 totalling that amount.   

103.  W says that this is untrue and the Family Loan Agreement dated 1 December 2020 attached to H’s second Answers on 16 December 2024 and only produced 20 months later, is fabricated.

104.  It is W’s case that H has first referred to this as a gift from the parents- in-law, she produced evidence of Whatsapp messages exchange with H in January 2021 (the month after the transfers and date of the alleged loan agreement)  wherein H says that this was money his parents would gift to them: “mom and dad wanted to send some cash for awhile … rhats basically money they will gift us.”  Under cross examination, he says he was not referring to this amount in the Whatsapp message.

105.  W also contends that H never previously said the Whatsapp messages referred to different funds; on this she says this is despite “W asking about the messages in her 2^nd Quesitonnaire on 30 November 2023, (b)  W exhibiting the messages with her 6^th Affidavit on 9 February 2024 (c)  and H having had a chance to reply with his 2^nd Affirmation on 3 April 2024”.

106.  The only other reference that I have been directed to involving H’s parents was his claim in his 1^st Form E that there were securities held in various securities account (FUTU and Sofi)  which beneficial interests were held by his parents.  W’s counsel criticized this discrepany in H’s two Form Es is not credible, counsel also reminded me that under cross examination , H’s retort to this was “In the end it’s the same thing”.

107.  W also put forward her argument that the signature on the Family Loan Agreement in fact does not belong to H’s father. She produced the signature of her father-in-law on an OCI Card application. When asked under cross examination, H initially was able to identify his father’s signature but when asked why his father’s signature looks different in the Family Loan Agreement, he said he didn’t know whose name it was on the OCI Card application.

108.  I am not of the view that H has come up to proof that there is a loan from his parents.  It is observed that the Whatsapp message about gift from parents followed closely to the receipt of the sums; and H in the message said that the parents were given the HSB account to send the money, the transfer H referred to from the parents were indeed paid into his HSB account.  I do not accept his explanation that there were different amounts as he did not say what those were, nor do I accept his contention that the assets he claims that his parents have interest (in the 1^st Form E)  and now these alleged loans (in the 2^nd Form E)  are “the same thing”.  H failed to explain why these sums are not gift, and on the balance, I decide that no weight should be attached to the Family Loan Agreement.  I therefore find that this amount is not part of H’s liabilities.

H’s other liabilities

109.  I will deal with this very briefly:

a.  There is nothing to support H’s allegation of the alleged loan of $435,000 which was receive just prior to the hearing, W’s counsel says this was accepted by him under cross examination.

b.  There is nothing to support H’s allegation that he has a liability of $515,775 with regard to legal advice to support “pre-trial and during trial proceedings”. Again, W’s counsel says this was also accepted by him under cross examination.

c.  H has alleged that there is a civil claim for misappropriation of company assets and breach of fiduciary duties.  In the A & L Schedule this is stated as $3,125,725 by H, and he also says there: “currently shortlisting legal firms. Investigation not concluded, nevertheless duty of disclosure to court is relevant of this significant issue, as it will be on the list of agreed issues and R’s Chronology, as belonging to the Petitioner’s liability column in first instance but joint in practice.”  With regard to this last item, I am unable to find any further reference.  H has made no cross reference to any materials in the bundle to support his contention; and in going through the Chronology, no further information was mentioned on this.

110.  In the absence of any supporting evidence, none of the above items will be counted towards H’s liabilities in the matrimonial pot.

W’s Assets

111.  According to the A & L Schedule, W’s bank account balances, the amount of her MPF, and her liabilities are not challenged by H.

112.  However, the amount of her MPF is $153,091; it is assumed that she worked after her marriage, and all of this amount is attributed to the duration of the marriage.  However, this amount needs to be adjusted for illiquidity discount.  Given that she is 42 years of age, and 23 years from collecting her MPF, I shall apply a 50% illiquidity discount to this sum, therefore placing $153,091 x 50% = $76,545 into the pot. 

W’s Liabilities

113.  The most controversial item is W’s loan from her family members of $1,300,000.  While H commented on other items in the A & L Schedule, he did not challenge the W’s family loan in the schedule; nonetheless, he then added this in as an issue in the Joint List of Issues.

114.  W has explained why this was needed.  I agree with her that it is well documented and very clear as this case evolved, that H had stopped depositing his salary in their joint account, W had no income as she was dismissed by H in April 2022 from the family business; and H has failed to pay the MPS, interim maintenance and legal costs provisions which were ordered in October 2023.  This put W in a situation where she has no option but to resort to borrowings from her family.

115.  The evidence that W provided include the following:

a.  The list she compiled recording money received by her or transferred to her account of a number of transactions from 14 September 2022 to 13 December 2024, this totals $1,318,002.

b.  Supporting bank account statements of some of these transfers (as there are sums delivered in cash).

c.  Notarized Statement from three family members, her parents and brother.  This Statement specifically states that her family members have been providing assistance to W, and also extended “ongoing monthly financial assistance and covered various expenses, including but not limited to education costs for N and other miscellaneous expenses”. It also specifically stated:

“However, we expect the total loaned amount of HKD1.3 million plus all other financial assistance provided towards the education costs of N and the other miscellaneous expenses, to be paid in full no later than April 30, 2026.”

116.  On this issue, I refer to the case of P v Q [2022] WLUK 268 with reference to soft loans, for completeness and reference, the relevant paragraphs from His Honour Judge Hess are quoted below:

19. …

(viii)  The first question is whether these advances should be regarded (in strict legal terms)  as gifts or loans. As a matter of general principle, for an advance of money to be a gift there must be evidence of an intention to give – the animus donandi. In neither instance in this case has either party produced persuasive evidence of such intention in the respective advancing parent and I am inclined to accept what the husband’s mother told me and what is contained in the 2004 document. On the face of it, both these transactions are loans which could, in theory, be enforced.

(ix)  In the family court, however, that is not the end of the matter because the inclusion or exclusion of a technically enforceable debt in an asset schedule can depend on its softness/hardness. This is perhaps an elusive topic to nail down, but it falls for determination in the present case as in many others.  I have looked at a number of authorities which deal wholly or partly with this point and I include the following in that category: M v B [1998] 1 FLR 53; W v W [2012] EWHC 2469; Hamilton v Hamilton [2013] EWCA Civ 13; B v B [2012] 2 FLR 22; Baines v Hedger [2008] EWHC 1587; and NR v AB [2016] EWHC 277. I have also looked at an article by Alexander Chandler (as it happens the FDR tribunal in this case)  on the subject: Family Loans an intervener claims – taking the bank of mum and dad to court [2015] Fam Law 1505. I derive the following summary of principles from this reading:-

(a)   Once a judge has decided that a contractually binding obligation by a party to the marriage towards a third party exists, the court may properly wish to go on to consider whether the obligation is in the category of a hard obligation or loan, in which case it should appear on the judges’ computation table, or it is in the category of a soft obligation or loan, in which case the judge may decide as an exercise of discretion to leave it out of the computation table.

(b)   There is not in the authorities any hard or fast test as to when an obligation or loan will fall into one category or another, and the cases reveal a wide variety of circumstances which cause a particular obligation or loan to fall on one side or other of the line.

(c)   A common feature of these cases is that the analysis targets whether or not it is likely in reality that the obligation will be enforced.

(d)   Features which have fallen for consideration to take the case on one side of the line or another include the following and I make it clear that this is not intended to be an exhaustive list.

(e)   Factors which on their own or in combination point the judge towards the conclusion that an obligation is in the category of a hard obligation include (1)  the fact that it is an obligation to a finance company; (2)  that the terms of the obligation have the feel of a normal commercial arrangement; (3)  that the obligation arises out of a written agreement; (4)  that there is a written demand for payment, a threat of litigation or actual litigation or actual or consequent intervention in the financial remedies proceedings; (5)  that there has not been a delay in enforcing the obligation; and (6)  that the amount of money is such that it would be less likely for a creditor to be likely to waive the obligation either wholly or partly.

(f)  Factors which may on their own or in combination point the judge towards the conclusion that an obligation is in the category of soft include: (1)  it is an obligation to a friend or family member with whom the debtor remains on good terms and who is unlikely to want the debtor to suffer hardship; (2)  the obligation arose informally and the terms of the obligation do not have the feel of a normal commercial arrangement; (3)  there has been no written demand for payment despite the due date having passed; (4)  there has been a delay in enforcing the obligation; or (5)  the amount of money is such that it would be more likely for the creditor to be likely to waive the obligation either wholly or partly, albeit that the amount of money involved is not necessarily decisive, and there are examples in the authorities of large amounts of money being treated as being soft obligations.

(g)  It may be that there are some factors in a particular case which fall on one side of the line and other factors which fall on the other side of the line, and it is for the judge to determine, looking at all of these factors, and maybe other matters, what the appropriate determinations to make in a particular case in the promotion of a fair outcome.

(emphasis added)

117.  I draw guidance from the above principles and make the following observations:  I take the view that there is a binding obligation to pay.  It is quite clear to me that there is no intention of a gift here from W’s family to W.  The loan commences after the proceedings were initiated; against the background of W being left in dire financial straits by H, and is credible in that there is an on-going need for her family to reach out to assist.  The Statement is important in recognizing that there is a deadline and expectation for the repayment to be made.  The deadline was reasonable in that it looks to the estimated end of these ancillary proceedings. W’s counsel reminded me that H’s cross examination of W on this subject went to how cash payment was delivered, W says her brother had paid for an agent for cash delivery to her.  H’s questions failed to cast any doubts on W’s case.  On a balance of probabilities and based on above observations, I find that there is at least a $1.3 Million liability owed by W to her family.

The Matrimonial Pot

118.  Based on my analysis above, my calculation of the matrimonial pot is as follows:

		In W’s name	In H’s name
1	Real Property: FMH -less mortgage		14,100,000 -6,717,143 = 7,382,857
2	Real Property : Q -less mortgage		2,861,400 -1,968,562 = 892,838
2	W’s Bank accounts	34,105
4	H’s bank accounts -BOC 4446 -HSB 7307 -HSBC UK -SCB SUB-TOTAL		117,627 90,136 43,402 48,372 (agreed day 4) 299,537
5	Joint bank account*	-5,219
6	Company S/H -LH -LHC		NIL NIL
7	H’s Investments -FUTU -Sofi SUB-TOTAL		40,553 52,248 92,801
8	Debts owed to H -From LH -From LHC SUB-TOTAL		3,551,336 10,000 3,561,336
9	Personal valuable -H’s Watch		7,650
10	W’s MPF	76,545
11	H’s MPF		3,255,600
12	TOTAL ASSETS	110,650	15,492,619
13	LIABILITIES W’s Liabilities: -various credit cards -legal fees -money borrowed from family SUB-TOTAL	290,989 2,151,006 1,300,000    (3,741,995)
14	H’s Liabilities: -Credit Card -Legal Fees owed to SW SUB-TOTAL		747,263 26,900 (agreed day 4)   774,163
15	NET ASSETS	(3,631,345)	14,718,456

119.  I therefore find that the amount of the matrimonial pot is $11,087,111 – $5,219* (negative amount in the joint account)  = $11,081,892.

120.  In coming to these numbers, I have also taken into considerations the following factors:

a.  The company SJE has calculated the valuation for the two companies LH and LHC to be nominal, both parties have agreed to attribute Nil value to both companies.

b.  H has not challenged W’s bank account balances, MPF amount, and liabilities other than the family loan.

c.  As for H’s bank account balances, W’s counsel has given me cross references on all the numbers appearing in the A & L Schedule which come from H’s most recent Form E in January 2025; whereas H attempted to say during the trial that there are new balances in these accounts.  It was explained to H that the Court would not be dealing with running numbers, and those with statements from H’s updated Form E are adopted.

W’s Income and Earning Capacity

121.  She has no personal asset to her name except for the bank accounts and MPF as set out above.

122.  W has been a housewife for a large part of the marriage; but had worked at the H’s companies and received salaries for it. She had also tutored at a tutoring centre in the past.

123.  Looking forward, in between caring for N with her special needs, W hopes to find work as a part time tutor and estimates income level at $15,000 per month.  This appears to be accepted by H in his oral submission.  

H’s Income & Earning Capacity

124.  The following table illustrates W’s case of H’s income, and his own declaration in his updated Form E:

	H’s case	W’s case
Basic Income after tax (December salary)	68,055 (81,993)
Basic Salary		82,376
Overtime last three months average (NET after tax)	16,768 (20,202)
Double pay (NET: average per month)	1,583 (1907)
Bonus (average per month)  over 17 years	1,625
Housing allowance (NET average per month)	26,400 (31,807)
Education allowance (NET average per)	4,125 (4969)	5,000
Monthly allowance		32,000
Monthly Productivity Pay		35,303
Annual Productivity Bonus, Discretionary Bonuses & profit Sharing		23,883
Holiday Pay and Annual leave pay		1,117
Cash / per diem		20,250
Other Allowances		7,233
TOTAL average per month for 2024	118,565 (142,603)
Monthly Total		207,163

125.  H’s income is mainly sourced from his work as a pilot, it is W’s case that he also receives income from his companies, and from the UK Property Q.

Income as a Pilot

Basic Salary and Allowance

126.  First of all, H’s number should not be “after tax”, I have reconstrued the numbers taking into account 17% tax rate and put those numbers in brackets under H’s column.  

127.  When the numbers are reconstrued, the basic salary, housing / monthly allowance and education allowance seem to align.  Referring to the Pay advices of January and February 2025 submitted by H, and per W’s counsel, the items of basic salary, education allowance and monthly allowance are not disputed.

128.  The rest of numbers under H’s column have no supporting, at least none that were referred to me.  H says his declared bonus was averaged across 17 years, again, I have no reference to the disclosure of these supporting documents.

129.  I will look at other categories of income below.

Monthly Productivity Pay

130.  According to the Condition of Service produced by H in his 1^st  Answers to Questionnaire, the calculation of the “monthly productivity pay” is in accordance with a formula:

Actual Block Hours less Minimum Block Hours x Block hour rate

The most recent “Block rate” appearing in Appendix 3 of the Employee Handbook for pilots Revision 12 (the “Handbook”), effective 1 January 2025, is $1681.14 hourly.  And the Minimum monthly Block Hours is dependent on the fleet which the Officer operates, based on the relevant Appendix 2, it is 49 hours if H flies a 777 or A330/350.

131.  W’s counsel says that the dispute is over how many Block Hours H had been flying.  On this, counsel puts forwards the following arguments:

a.  It is W’s case that H will fly at least 70 hours per month, this equals the airline’s “Target Annual Block Hours” of 840 (Appendix 4 of the Handbook)  for A330/350 pilots.  The maximum hours permitted by the Civil Aviation Department (HKSAR Government)  is 100 hours per 28 days and 900 hours per year on a rolling basis.  In H’s Form E year dated April 2023, he said he had been flying over a 100 hours per month, and under cross examination, nearly 900 hours in 2023.  Then in a table provided by H himself, it shows that he had hit 900 hours for the 12 months ending October 2024.

b.  H has argued in his affirmation in support of his March 2025 variation application that his average monthly Block Hours had dropped to 55-60 hours in early 2025, this is countered by W’s counsel’s submission that this was due to H having taken a total of 67 days of leave from November 2024 (after completing the maximum allowable 900 hours the month before), and therefore his Block Hours were less during the relevant period shortly before this trial. 

c.  With regard to H’s allegation that he had been flying less due to him having “maximized” his flight time.  W also quoted from the decision of DDJ WY Ho who wrote the MPS Judgment delivered on 20 October 2023 at §35:

“I find this to be speculation on his part and without evidentiary support from his employer. Despite having previously given directions to the Respondent to file his affirmation in opposition, he failed to file the same. The Respondent has not produced any letters from his employer, or any form of evidence from his employer to say that he would be prohibited from flying in the near future or that his flight time would be limited.”

I share the same sentiment.

132.  I make reference to some attachments provided by H via email to W’s solicitors on 2 April 2025, just 5 days before the Trial.  H has put in a table his regular and secondary pay for the period from April 2024 to March 2025, together with a number of his payslips.  His regular pay is usually around 26^th / 27^th of the month and consists of the education allowance, monthly salary, monthly allowance on a monthly basis, and also “Profit sharing” at the end of the year .  And the secondary payslip issued around 7^th of the month includes inter alia, flying allowance, monthly productivity pay, holiday pay adjustments and Sim Crew-up allowance.

133.  I am mindful that these are not in sworn evidence, but given these are company issued payslips, I will give them due weight.

134.  What is relevant to me is the monthly productivity pay which I set out as follows from various part of H’s evidence, including those from this aforesaid email:

Date of payslip	Amount of Monthly Productivity pay	Unit	Date of payslip	Amount of Monthly Productivity Pay	Unit
7 Jan 2023	31,529	24.85	6 Jan 2024	36,634	28.65
14 Feb 2023	501		7 Feb 2024	58,850	45.42
7 Mar 2023	31,801	24.87	Mar 2024	Not provided
6 Apr 2023	66,875	52.3	6 Apr 2024	50,272	38.8
6 May 2023	41,557	32.5	7 May 2024	76,186	58.8
7 Jun 2023	73,627	57.58	7 Jun 2024	26,691	20.6
7 Jul 2023	61,249	47.9	6 Jul 2024	35,592	27.47
7 Aug 2023	59,714	46.7	7 Aug 2024	21,184	16.35
7 Sep 2023	30,714	24.02	7 Sep 2024	15,859	12.24
7 Oct 2023	14,231	11.13	7 Oct 2024	47,486	29.32
Nov 2023	Not provided		7 Nov 2024	19,548	12.07
Dec 2023	Not provided		Dec  2024	Not provided
	Average 2023 = 41,179	Total = 321.85		Average 2024  = 38,830	Total = 289.72
			7 Jan 2025**	162	0.1
			Feb 2025	Not provided
			March 2025	Not provided

**This month H received discretionary bonus and annual productivity bonus at $98,804 + $26,470 = $125,274

135.  My observation is that H has been consistently receiving monthly productivity payment, the fact that he did not produce any secondary payslip for some of the months does not necessarily mean there are none.  The average amount for the 2 years prior to the hearing is in the range of $38,830 to $41,179.  In the consideration of his allegation that he had been flying less in early 2025, W’s counsel says that this was after flying to the maximum of 900 hours on the year by October 2024.  I have no evidence as to the protocol when this happens to a pilot, and the extent to which it may affect the number of hours he can fly immediately after; this remains an open question. I also accept W’s counsel’s submission that H had taken a number of leave days; based on the evidence he provided, he was on leave from 25 November to 15 December 2024, then from 20 January to 9 February 2025, and for 10 days in April 2025, this would have reduced his block hours, but it does not support his contention that he has no or less of such pay going forward. 

136.  In brief and on a balance of probabilities, I accept W’s submission that there is a monthly productivity pay, while this may not be received every month due to the scenarios described above, there can be an average monthly amount.  W submits that H should be taken to fly 70 hours per month (which is the airline’s target annual block hours of 840 /12), which is 21 hours more than the monthly minimum of 49 hours. This equates to (70 – 49)  x $1681.14 = $35,303 of monthly productivity pay, which is less than the average numbers I  calculated above.

Annual Productivity Bonus, Discretionary Bonuses & profit Sharing

137.  W submits that H is entitled to Annual Productivity Bonus (which is received when H has accumulatively flown more than the annual target hours), Discretion Year-end Bonus and Profit Sharing.  The following table is largely  from W’s closing submission:

	Incur 2022	Incur 2023	Incur 2024
Annual Productivity Bonus	Information not available	52,426	26,470
Discretionary Bonus	76,002 Ex-gratia Payment (Dec 2022)	122,328 Ex-gratia Payment (September 2023) 87,377 Discretionary Bonus 2023	98,804 Discretionary Bonus
Profit Share	Information not available	146,793 (Received in April 2024)	In his cross - examination, H says it will be announced
TOTAL		408,924	125,274 + TBC profit share

138.  W submits that for 2023, if removing the ex-gratia payment, there is a total of $286,596 which average out to $23,883 per month, and submits that this is the additional amount H would be expected to receive.  I accept W’s argument that based on past pattern, H is likely to receive these items of additional payments, W has not claimed the full amount that could be taken from 2023 (which is $408,924/12 = $34,077), I think this estimate is more than fair.

Holiday Pay and Annual leave pay

139.  W submits a table attached to her opening submission which records from payslips H’s entitlement to working on “statutory holidays”, this comes up to an average of $1,117 and which she says was confirmed by H under cross examination to be “reasonable”.

Cash Allowance

140.  W says H is entitled to “Overnight and Meal Allowance; Per Diems” as provided in the Handbook.  She relies on a document submitted by H under his November 2023 variation application which shows an item of “Cash Allowance from CHASE (Consumed on overseas mission and long quarantine)” of $486,000 .  This amount is logged under March 2023 in his document, but I am unable to find this amount in H’s SCB account statements during the relevant months, nor in the payslips.  W’s counsel submits that these amounts are received in cash, which I doubt.  But as this is from H’s own evidence, he did not deny the record of this amount he received.  W’s counsel says that H did not provide the equivalent information for 2024, nor information relating to “Allowance” under his contract; H’s response to this is that he is not allowed to share and that he was not asked to produce.  W therefore says that H should be attributed at least half of this 2023 amount as his pay under this item, which makes it $243,000 and averaged to $20,250 per month.

Other income

141.  W has compiled a list of deposits into H’s SCB account which reference payment from his airline company, this appears as Appendix B in her opening submission titled “2024 [Airline company] Payments not on Payslips”.  These are extracted from the bank statements that H provided.  The amount totalled $86,797 averaged out to $7,233 per month.

142.  W’s counsel reminded me that under cross examination, H argues that these were his per diem payment for 2024 and he said he had provided the relevant screenshot.  H made no reference to this in the bundles of evidence; it is therefore not accepted that he had produced the document.

143.  In the absence of any satisfactory balancing argument from H, I accept that these miscellaneous items are likely to be additional allowance given to H under his contract. 

144.  H says his income should only be viewed from the salary tax bills. For completeness, I extract the figures from the evidence and list as follows.  While the numbers appear to show a downward trend during and after covid, the last figure I have shown an increment from the previous year.

Tax year	Gross Income	Monthly Income	Tax payable
2019-2020	2,330,509	194,209	298,346
2020-2021	2,301,333	191,777	335,199
2021-2022	2,160,775	180,064	276,431
2022-2023	1,808,261	150,688	214,647
2023-2024	1,838,087	153,173	224,494

145.  It appears to me that W’s case of H’s income referred in paragraph 124 above is large made out, those figures tally a monthly sum of $207,163.  Admittedly due to the nature of H’s work, the complexity of his pay structure, and the lack of disclosure from H with regard to at least his Rostering Guideline and Allowance section referred to in the Handbook, it is not possible to place a finger on the exact monthly amount (or range)  he is making. 

Other Resources : Income from his Company

146.  W argues that H’s other resources come from drawings from his companies LH or LHC, and that the companies have been paying for H’s various expense.  

147.  Firstly, W says that LH had been paying for the H’s rental, at least from March 2022 until November 2023, the latter date W’s counsel submits that it was strategic as it ended on the month after the October 2023 MPS Order and H filed his application to vary maintenance.

148.  W’s legal team has also usefully compiled numbers from the Company’s LH and LHC bank account and credit card statements. Some of these goes back to 2019/2020, throughout the divorce proceedings, and into November 2024.  The companies have been paying for:

a.  Utilities bills of Electricity, Broadband, town gas

b.  H’s club membership, gym membership

c.  H’s personal entertainment and presents, including trip.com and car rental expenses

d.  H’s clothing /shoe expenses

149.  Under cross examination, H says these sums are “borrowed”. W’s counsel submits, and I agree, that as shareholder of the companies, he can label these amounts under any category, be it as salary, emolument or loan.  Furthermore, H has not made any reference to liabilities owed to the companies for these sums.

150.  W has previously asked H to identify which expenses are for companies and which are personal in her 3^rd questionnaire and H has failed to answer the question.  He has also failed to produce supporting documentation of the expenses when asked. 

151.  If H maintains this is a Director’s loan, he has failed to provide any supporting documentation for this contention.

152.  W asks that H be inferred in his ability to draw at least $21,000 per month from his companies, using the amount of rental as a basis.  This is a modest estimate, and he had clearly been drawing more than this amount.  It is my finding that the companies are his financial resources which supplements his living expenses.

Other Resources : Income from Q

153.  H receive GBP1,310 rental from this property, this appears from a statement addressed to the Landlord from the agent managing Q, and beyond dispute.

Comments on H’s Income

154.  Looking at H’s income as a pilot, and taking it at the lowest, he is making $153,173 on his own evidence.  He has an earning capacity of $194,209 pre-covid, and even during covid, he was making more than $180,000 per month.  H says there had been a pay restructuring but again I have not been taken to any document issued by his employer airline in support.  I accept W’s counsel’s submission on the various allowances he receives, which H has clearly under reported.  I also accept that he has the ability to draw from his two companies of which he is a 100% shareholder, and H has not been able to prove that the miscellaneous items W put into evidence are merely loans as he claims.  The rental income from Q in the UK is also unequivocal, although the related expenses will be taken into account below.

155.  I find that the H has more income than he declared.  Relying on the above-mentioned legal principles enunciated in the case of Moher v Moher, I do not need to come to an exact figure on H’s income and financial resources. Further, based on the Order I made on 21 February 2025, and in the absence of H’s filing his narrative affidavit, I shall draw the necessary inference against him on his ability to pay for the Orders I am due to make in this decision. 

Assessing Parties’ Needs

W’s Financial Needs

156.  W asks for a clean break in her open proposal.  She provides her updated expenses in her most recent Form E.  In the circumstances, I still need to look at her general expenses as claimed, the following numbers are extracted from her narrative affidavit:

GENERAL	HK$
Rent (on basis that the FMH will be sold)	30,000
Utilities	3,583
Food	8,700
Household expenses	7,200
Domestic Helper	8,000
Insurance	-
Others: Pet, Spotify, Netflix	3,600
TOTAL : General	61,083

157.  As the amount of general expenses will affect N’s expenses, I need to assess them for reasonableness.  I am of the view that various expense items are exaggerated, and I will take a broad-brush approach and propose the following adjustments taking into account the expenses are for one adult and one child:

a.  Food $5,000

b.  Household $3,000

c.  $7,000 for domestic helper

d.  $1,000 for Others 

The General expenses will therefore be $30,000 + $3,600 + $5,000 + $3,000 + $7,000 + $1,000 = $49,600.

158.  The following is the W’s declaration of her own expenses.

PERSONAL	HK$
Meals out of Home	3,500
Transport	3,800
Clothing / Shoes	3,000
Personal grooming	2,800
Entertainment / presents	500
Holiday	1,000
Medical / dental	400
Tax (assuming income of 15,000 per month)	2,250
Insurance	10,712
TOTAL:	27,962

159.  While I take the view some of her expenses are on the high side, W is not asking for spousal maintenance from H.  That said, I find that that she should be able to manage her portion of the general expenses and her personal expenses with her own income and from the Order to be made herein, with appropriate adjustments to her discretionary spending.

N’s Needs

160.  W produces the following numbers for N’s needs; the right-hand column shows the Court’s assessment.

	From W	Court’s assessment
Meals out of home	3,500	2,000
School Fees	2,500	2,500
Tuition	2,800	2,800
School books and stationery	1,800	800
Transport to School	2,000	1,500
Medical / Dental	500	500
ECA	1,200	1,200
Entertainment/ presents	500	500
Holidays	1,000	1,000
Clothing / Shoes	2,800	1,500
Insurance premia	(H pays)	-
Lunches and Pocket money	2,000	2,000
Other transport	300	300
Uniform	400	400
Others: Phone Bill	250	250
TOTAL	21,550	17,250

161.  I also take the view that these numbers could be pared down.  In a divorce scenario, while standard of living is not substantively challenged, W should look to some economizing for both herself and N:

a.  It is not accepted that N needs $3500 for meals out of home, that is high number against W’s budget for food and N’s lunch allowance, I will allow $2,000.

b.  W’s estimate and explanation in her affidavit of N’s transport to school is also high.  W is planning to move to a rental place after the FMH is sold, and she should consider someplace either on N’s school bus route, or closer so N can spend less time and costs on travelling.

c.  School books and stationery at $1,800 is excessive, I will allow $800.

d.  Clothing at $2,800 is also high, I will bring this down to $1,500.

162.  W asks that due to the disparity of income, H should carry all of N’s expenses.  Given that H’s earning capacity is more than 10 times of the W, I agree that this is a fair and reasonable ask.  This would mean ½ share of general expenses and N’s own expenses as adjusted by me.  N’s expense is therefore assessed at $ 24,800 + $17,250 = $42,050.  I shall round this down to $42,000.

H’s Needs

163.  The following of H’s numbers are from H’s latest Form E, and on the right-side, W’s position regarding his expenses extracted from her narrative affidavit.

GENERAL	HK$	W’s position
Rent	22,500	22,500
Mortgage for FMH	44,943	Nil, in the event FMH is sold
Management Fees	3,075	Nil, in the event FMH is sold
Utilities	4,866	3,000
Food (Groceries)  International travel for work	7,674	4,000
Household expenses (furniture and moving)	4,150	2,000
Utilities Petitioner’s behalf	2,575	Nil, included in spousal and child maintenance
Insurance premia	314	Nil, in the event FMH is sold
Domestic Helper	2,500	2,500
Loan instalment	16,933	16,933 – last instalment dated on 8 October 2029
Others: UK Property related	12,099	12,099
SUB-TOTAL : General	121,630	63,032

PERSONAL
Meals out of Home	6,550	4,000
Transport (airport night time)	2,375	1,000
Clothing / Shoes	950	950
Personal grooming	950	950
Entertainment / presents	150	150
Holiday	650	650
Medical / dental	550	550
Tax	Included in 3.1	17,877 based on H’s Tax return 2022-2023
Parents Loan repay	7,500	Disputed
SUB-TOTAL:	19,675	26,127 (including tax)
TOTAL	141,305	89,159 (including tax)

164.  Other than not comprehending why “furniture and moving” is a monthly / recurring expense; I am of the view that some of H’s numbers are also exaggerated.  I agree with W that his expenses on food, and utilities and meals out of home are high and I am inclined to agree with her proposed numbers; more importantly, as items relating to the FMH is likely not be required going forward, those carved off more than $50,000 from his expenses.

165.  Taking into regard his own numbers, and W’s counsel’s submission regarding his income.  I find that that H’s needs can be satisfied from his income, and if need be, with some economising on his end as well.  At his age, he has ongoing earning capacity, and access to his retirement fund in due course. 

166.  On his own evidence, H’s income is $153,173, it is my finding that he can and has the capacity to make more, and he has other financial resources.  Using his own numbers and net of the expenses from the above assessment, $153,173 – $89,159 = $64,014, he is well able to afford the full amount for N of $42,000; and he would have more surplus than from this calculation based on the analysis above.

Other factors taken into account

Parties living standard

167.  H has not put forward anything to dispute W’s case with regard to her standard of living.  Her narrative presents a more than average living standard: 3 bedroom apartment in the mid-levels, domestic help, organic food, upscale restaurants, brand name clothing, gym membership and regular grooming.  W’s evidence could be seen from her credit card statements and a number of receipts in evidence.

168.  In the absence of any evidence to the contrary, and H’s failure to cross examined on this topic or put his own case forward, W’s case is accepted.

H’s litigation conduct

169.  There are allegations of serious litigation conduct on H’s part.  This was well presented in detail in the W’s 12^th Affirmation, to show the stark severity of his conduct, and deserved to be quoted in full:

43.  In summary, the Respondent’s litigation misconduct in chronological order is as follows:-

43.1.  He failed to file his affidavit in opposition to my relocation application in breach of the Order of Deputy District Judge W. Y. Ho dated 11^th February 2022 which was supposed to be filed on 29^th April 2022 despite being represented by a specialist family law firm at the time, Messrs. Stevenson, Wong & Co.

43.2.  He failed to file a Form J and Concise Statement of Issues relating to the Child of the Family in breach of the Order of Deputy District Judge W. Y. Ho dated 11^th February 2022 which was supposed to be filed on 31^st May 2022 despite being represented by Stevenson, Wong & Co.

43.3.  He filed his Answers to my 1^st questionnaire late in breach of the Order of Deputy District Judge W. Y. Ho dated 22^nd September 2022 which gave both parties a time extension till 13^th October 2022. Despite the Respondent getting a further extension to 8^th December 2022 pursuant to the Order of Deputy District Judge W. Y. Ho dated 17^th November 2022 with penal notice endorsed, he only filed his Answers on 12^th December 2022.

43.4.  He fail to file his affidavit in opposition re MPS & litigation, funding in breach of the Order of Deputy District Judge W. Y. Ho dated 17^th November 2022 with penal notice endorsed.

43.5.  He filed his Updated Form E late, in breach of the Order of Deputy District Judge W. Y. Ho dated 22^nd March 2023 which gave him a time extension till 24^th March 2023.  He only served his Updated Form E to us on 27^th April 2013, the day before my substantive MPS and litigation hearing on 28^th April 2023, despite paragraph 2 of the Order stating “no further time extension shall be granted for the filing of Form Es”.

43.5.1. In order to avoid adjourning the substantive hearing which would put me in further financial dire straits， we had no choice but to agree the Respondent’s very late filing of his Updated Form E which was accepted into evidence and considered by the Judge at the hearing. My legal team had to analyse the Respondent’s Updated Form E and consider the differences from his prior Form E dated 7^th February 2022 at the substantive hearing despite only having less-than half a day to consider the document.

43.6. Breach of the MPS Order dated 20^th October 2023 for interim maintenance for myself and Nia and litigation funding until the Attachment of Income Order dated 29^th May 2024 in respect of child maintenance only.

43.7. He continues to breach paragraph 1(a)  the MPS Order as he has failed to pay any interim maintenance for myself at HK$19,000 per month and paragraph 2 as he has failed to pay any litigation funding of HK$17,000 to OLN.

43.8. Save for only the mortgage instalments at paragraph 3 of the MPS Order, he has failed to pay any of the items listed at (b)  to (e)  which include the utility bills of the FMH, the management fees of the FMH, Nia’s school fees or ·the domestic helper’s fees.

43.9.  He filed his Answers to my 2^nd Questionnaire in late, in breach of the Order of Deputy District Judge W. Y. Ho dated 9^th November 2023 which was supposed to be filed on 28^th December 2023. Despite being given a time extension till 5^th March 2024 pursuant to the Order of Her Honour Judge T. Kwan dated 20^th February 2024 and a second time extension till 15^th November 2024 pursuant to the Order of Her Honour Judge T. Kwan dated 25^th October 2024 (which was on an unless basis failing which adverse inferences would be drawn by the Court at trial), he still failed to file his Answers. It was not until the third time extension till 16^th December 2024 per the Order of Her Honour Judge T. Kwan dated 11^th December 2024 which again was on an unless basis failing which adverse inferences would be made by the Court, that he is able to pay any spousal or child maintenance that is ordered by the Court, that the Respondent finally filed his Answers on 16^th December 2024, almost 1 year late from the original deadline on 28^th December 2023.

43.10.  He filed his Statement of Means (Form 1)  in response to my Attachment of Income Summons late, which was supposed to be filed on 17^th January 2024. As a result, I was forced to apply to Court for an order that he file his Statement of Means. However, despite the Order of Master J. Cheung dated 9^th February 2024 ordering him to file his Statement of Means within the next 7 days (i.e. 16^th February 2024), he did not file his Statement of Means until 20^th March 2024.

43.11.  He failed to attend the hearing on 26^th January 2024 despite this being the directions hearing on his Variation Summons.

43.12.  He failed to respond to OLN’s letters in which the parties were to jointly lodge an Agreed Schedule of Assets and Liabilities on 1^st February 2024 under the Order of Deputy District Judge W. Y. Ho dated 9^th November 2023. As a result, my lawyers had to file their own asset schedule.

43.13.  He failed to respond to OLN’s letters in which the parties were to jointly lodge an (1)  agreed Statement of Factual Issues in Dispute and (2)  Chronology of Events on 9^th February 2024 under the Order of Deputy District Judge W. Y. Ho dated 9^th November 2023. As a result, my lawyers had to file their own documents.

43.14.  He failed to file his Answers to my Supplemental Questionnaire, dated 21^st February 2025 in breach of the Order of Her Honour Judge T. Kwan dated 21th February 2025 which was supposed to be filed on 7^th March 2025 on an unless basis failing which he would be debarred from filing his Answers with necessary adverse inference to be drawn.

43.15.  He delayed in paying the SJE fees and providing information/documentation to the SJEs. He provided false and misleading information to the SJEs to influence the valuations.

43.16.  No payment of the following costs orders:

43.16.1.  HK$1,400 for the Respondent’s time extension which is to be pay forthwith pursuant to the Order of Master Eleanor Yeung dated 27^th March 2024.

43.16.2.  HK$187,347.93 which is to be paid forthwith pursuant to the Summary Assessment Order dated 17^th April 2024.

43.16.3.  Order of Her Honour Judge T. Kwan dated 29^th May 2024 re variation of maintenance: Respondent is required to pay my costs of and incidental to his Variation Summons prior to the 29^th May 2024 hearing on an indemnity basis, to be paid forthwith and taxed forthwith if not agreed and my costs “of and incidental to the substantive hearing on 29^th May 2024 on a party and party basis, to be paid forthwith and taxed forthwith if not agreed” which also includes certificate for Counsel.

43.16.4.  Order of Her Honour Judge T. Kwan dated 29^th May 2024 re Attachment of Income: Respondent is required to pay my costs forthwith to be taxed forthwith if not agreed.

43.17.  He has also been ordered to pay for the following additional costs:

43.17.1.  Order of Her Honour Judge T. Kwan dated 11^th December 2024: Respondent is to pay l/3^rd of my costs of and incidental to the hearings on 20^th February 2024, 25^th October 2024 and 11^th December 2024, to be taxed if not agreed.

43.17.2.  Order of Her Honour Judge T. Kwan dated 21^st February 2025: Respondent is to pay my costs of and incidental to my Summons filed on 20^th February 2025 for leave to enforce arrears of maintenance to be taxed in accordance with Legal Aid Regulations, with certificate for Counsel.

170.  The above narrative speaks for itself.  As H has not taken up this point at all at the hearing, nor present any explanations for his delinquency, I take the view that H’s conduct needs to be fully taken into account.  It has caused delays in these proceedings, and W has incurred extra costs for applications to chase his payments, attended additional hearings only to find out that he was seeking further extensions for compliance with Court Orders, which he then again failed to comply.

171.  Further and not mentioned above, H had then chosen to do further “document dumps” with his 3^rd Answers (135 pages of exhibits)  and his variation application (264 pages of exhibits), both submitted within a month of the trial, which have no cross reference to the main document; he involved the SJEs with last minute exchanges, and still failed to provide adequate information on request. 

172.  With regard to H’s non-payment of maintenance, I make reference to W’s narrative affirmation.  She says as of 20 February 2025, the following payments are outstanding:

a.  Arrears of MPS $19,000 per month including (1)  backdated payments from 20 September 2022 to 20 September 2023 (13 months)  due on 20 October 2023 and (2)  from 20 October 2023 to 20 February 2025 (17 months), to be paid on 20^th of each month : $570,000 (30 moths)

b.  Arrears of litigation funding of $17,000 per month from 20 October 2023 to 20 February 2025 (17 months), to be paid on the 20^th of each month : $289,000

In the absence of evidence to the contrary, these amounts are outstanding still and accumulating.

173.  H has also failed to pay for the child’s maintenance of $17,000 per month, and W had to incur extra legal costs to apply for an Attachment of Income Order on 29 December 2023 which was granted on 29 May 2024.  This Order incorporates payment of the monthly $17,000 and the previous outstanding payments to be made over 36 months.

174.  I do not find H to be a credible witness, there are multiple occasions when his utterances are proved to be untrue or not substantiated (inter alia, under reporting his income, disputing the loans he made to the company, suggesting a  debt collection issue with flimsy documentation in support with no context, disputing the gift from his own family calling it a loan despite the evidence from his own Whatsapp messages to W).  H has chosen to participate in these proceedings on his own timetable without due regard to or respect for Court Orders.  While H has produced a number of financial statements, I also find that he has still failed to provide pertinent information that support his arguments nor produce explanations and information when asked by W.  His contentions are therefore almost wholly unsupported.  

Other conduct

175.  For completeness I will also touch on the topic of a $297,500 alleged to be removed by W from the account of LH.  W says he had been receiving a salary of $59,500 from LH from 2020 right up to September 2021 when H stopped paying her salary.  This is the month leading up to the parties’ argument which involved police intervention in October  2021.  W said she had used up her limited savings since and on 27 January 2022 took out $297,500 being the sum owed to her as salary for 5 months from September 2021 to January 2022.  While complaining about this act and how this had affected operation fund flow for the company, H had actually mentioned the amount of $60,000 as W’s salary more than once in his affidavit supporting his variation application, and he had never said that this 5 months’ salary was not owed to her.  There were subsequent discussions on reduced salary to her after this incident, until April 2022 when W says she was constructively dismissed by H from LH.

176.  H had in his Form E says W had removed various sums from Joint account to personal account in 2022 but provided no details of such allegations.

177.  H also alleges there were “multiple incidents of fabricated / falsified” domestic violence, where police in “all cases dismissed the cases including the court”.  To this allegation of fabrication, W refers to an incident on 18 October 2021 when there was alleged domestic violence at the FMH wherein W said to the police that H had pushed her and dragged her across the rooms at the FMH.  It was N who reported to the police. W says that in November 2021, she gave a statement to the police saying that she would not be attending court to give testimony, as a result of which the charges of common assault against the H was withdrawn.  H’s case was not “dismissed” as he represented, nor was he acquitted. 

178.  The conduct to be considered if to be taken into account for my assessment of ancillary relief, must be one of “obvious and gross”, I am of the view that none of the above incidents under this heading reach the threshold for my consideration. 

Application of the Sharing Principle and departure from equality

179.  This is a marriage of 13 years where both parties had contributed considerably.  H as the breadwinner; and W as a home carer with a special needs child, and she worked at H’s two businesses.  W asks for equal sharing of the matrimonial pot.  H has stated no position.  I agree with W.

Deciding the Outcome

180.  Referring to paragraph 119 above, the amount of the matrimonial pot is therefore $11,081,892.

181.  I am conscious at this point, that I am facing a situation where, if I were to take into account W’s liability for legal fees of $2,151,006 (which is the unpaid legal fees appearing in her updated Form H); and to award costs to her as I am entitled to do in this case, then there may well be double counting.

182.  I have therefore decided to leave the amount of her legal fees to be dealt with under Costs, and to re-look at the size of the pot in that light.

183.  The matrimonial pot, after removing $2,151,006 liability from W’s side of the balance sheet, will become $13,232,898. 50% of this will be $6,616,449.

184.  In awarding W 50% of the pot, the equalisation amount W shall receive is $6,616,449 + $1,590,989 (being the summation of W’s liabilities from her credit cards and the family loan)  = $8,207,438.

185.  This leaves $5,025,460 to H.

186.  The disparity in these numbers comes from a need to make good the lack of maintenance that H has failed to pay in his blatant disregard of a Court Orders, proper adjustment is called for.  I am of the view that the assessment reflects a fair outcome.

H’s Variation of Maintenance Application

187.  H’s variation application has not come up to proof:

a.  H’s allegation of a restructuring exercise and a letter of restructuring from his employers from October 2020 was not brought to my attention, and referring to that date, should have been brought into evidence when W’s MPS application was heard in April 2023. 

b.  H says the decision was based on outdated income data, but the latter could only have come from him or within his power to update the Court for that hearing.

c.  I have dealt with H’s allegation of flying less hours in early 2025 above.

d.  H also says that he has a salary cut.  I have no reference to any evidence to support this contention.  From the information he submitted, his basic salary at least from April to August 2024 was $63,489, from September 2024 to December 2024 was $79,360 and then from January 2025 to the time of this hearing was $82,376.  On the face of this, it shows a 30% increment over one year.

e.  H then says there is no more housing allowance. Yet he declares a housing allowance in his latest Form E of $26,400 (net average per month)  and accepts there is a monthly allowance of $32,000 in his payslips.

188.  W’s alleged expenses have been adjusted by me, and her earning capacity taken into account.   H’s ability to pay has been considered.

189.  The amount of maintenance has been varied under these ancillary relief proceedings but not based on H’s application.  There is no more maintenance due to W, and N’s maintenance has been adjusted taking into account her share of the general expenses.

The Attachment of Income Order

190.  There is an existing Attachment of Income Order.  This is for the $17,000 for N, as well as arrears of $9,916.60 from May 2024 for 36 months.  Given that I have assessed N’s needs to be $42,000 in this decision, and that H is to bear the whole amount, there is a need to vary the amount for the AOI Order.

191.  I shall exercise my discretion under the Rule 9(1)  of the Attachment of Income Rules (Cap13A)  to vary the AOI Order made by me.

192.  W says that she has complied with Rule 5A to give notice to the H in advance of the Trial with a Form 3A, this was filed on 2 April 2025.  

193.  An Order for $42,000 shall be made under Form 4 of the Rules.

194.  For the avoidance of doubt, paragraph 3 of the Order made on 29 May 2024 shall remain in force until full payment.

Costs

195.  I see no reason why Costs should not follow the event.  There shall be a Costs Order in W’s favour.  Given the litigation conduct which was elaborately set out above, this is a case in which an Indemnity Costs Order should be made.

Orders

196.  For the reasons aforesaid, I make the following Orders:

a.  The Form A registered to the FMH shall be vacated.

b.  The FMH shall be sold within 6 months from the Decree Absolute. 

c.  W shall have the carriage of sale of the FMH.  H shall execute all necessary documents to effect this sale.  On discharging the liabilities and costs relating to the sale, the whole of the net proceeds shall be paid to W.  The costs of this transaction to be borne by both parties in equal shares.   

d.  H shall pay a lump sum of $8,207,438 to W.  The amount to be paid in the following manner:

i.  The net proceeds of the FMH (taken to be $7,353,625); and

ii.  Balance of $853,813 to be paid as instalments over a period of three years in the following manner:

1.  $253,813 within 6 months from the Decree Absolute (1^st instalment);

2.  $300,000 within 12 months from the 1^st instalment (2^nd instalment); and

3.  $300,000 within 12 months from the 2^nd instalment.

e.  Maintenance for N shall be varied from $17,000 to $42,000.  Such payment to be made via the Attachment of Income Order to commence from June 2026; until N reaches the age of 18 or completes full time education, whichever is later.

f.  Costs of these proceedings, including H’s second application for variation of maintenance, and all costs reserved, be to the W on an indemnity basis, to be taxed in accordance with legal aid regulations, with certificates for counsels.  This to be a Costs Order nisi to be made absolute 21 days hereof.

g.  Liberty to apply for the implementation of these orders.

h.  Section 18 Declaration to be issued.

197.  Finally,  I take this opportunity to acknowledge the able assistance of W’s counsels.