XCHRX BRIAN LAWRENCE KING v. JULIE CAROL KING

1986, No. DJ5

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATION REGION

(DIVORCE JURISDICTION))

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RULING AS TO COSTS

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1. In December 1996, Brian Lawrence King, the Applicant, instituted proceedings against his ex-wife, Julie Carol King, in terms of which he sought the variation of an order of maintenance which had originally been made in 1987. His summons was couched in the following terms :-

"The order of the Honourable Mr Justice Mayo (as he then was) dated 4th day of May 1987 be varied so far as it relates to the making of the periodical payments by the Husband to the Wife on such terms as the court shall think fit."

2. Regrettably, there were various delays in bringing the matter to court and it was not tried until November 1997. On 11th December 1997, I handed down judgment. As to costs, my order stated that, in the absence of agreement as to costs, there be liberty to apply. There was no agreement reached. As a result, the parties returned to argue the matter.

The basis of Applicant's substantive claims

3. The Applicant sought to vary the existing order on four grounds. These were detailed in his supporting affidavit as follows :-

"(i) The relevant Order does not differentiate between maintenance payable to my ex wife and maintenance payable to the two children of the family. I am advised that this is wrong.

(ii) My eldest daughter, Gemma, was 18 years of age on the 21st of July 1996 and is not currently attending any further education establishment nor has she been since before her 18th birthday.

(iii) My ex wife has been working in regular employment for several years and has a regular income although I am unaware of the amount thereof.

(iv) My ex wife is cohabiting with a Mr. George Salamon and has been for some time."

4. In respect of the first ground, the ex-wife, that is, the Respondent, agreed at the commencement of the hearing that the original order was too general in nature and needed to be broken down into its constituent parts. That original order had been phrased in the following terms; namely, that the Applicant :-

"..... do pay or cause to be paid to the Wife and children (Gemma and Francesca) periodical payments at the rate of HK$20,000 per month payable monthly in advance during joint lives until the Wife's remarriage or until further order, such periodical payments to be increased annually in accordance with the Cathay Pacific cost of living index."

5. In the orders made under my judgment, I did proceed to break down the original maintenance order into its three constituent parts, isolating and then quantifying the maintenance due for each child and also that which, in my opinion, was still due and payable to the Respondent.

6. In his address concerning costs, Mr Erving, who appeared for the Applicant, argued that the Applicant had been forced to come to court to obtain a rectification of the original order and to that extent, therefore, he had been substantially successful. He argued that there had been no clear and rational proposal made by the Respondent prior to the hearing which would have enabled this rectification at least to have been made by agreement. That may be so but, in my opinion, it would be wrong to think the Applicant had sought nothing more than the re-phrasing of an order which, by reason of the effuxion of time, had become unworkable. It is apparent from the Applicant's affidavit cited supra that the re-phrasing of the order was only one of the matters that he sought. Indeed, the original letter written to the Respondent on behalf of the Applicant identified just two areas of concern. That letter dated 12th November 1996 read inter alia :-

" We are instructed that your daughter Gemma has now reached the age of majority and you are thus not entitled to further payments of maintenance in respect of Gemma.

Further, we have established that you are now cohabiting with one George Salamon and have been for some time, so that these circumstances entitle our client to apply to vary downwards the existing maintenance order."

7. I have read the other correspondence handed to me during the argument on costs and while, of course, the matter of rectifying the wording of the original order was made a central issue in that correspondence, in reality and in substance the Applicant was seeking much more. He was seeking an order that he deal directly with his eldest daughter, Gemma, concerning all her educational and living expenses and an order that he cease paying any maintenance to his ex-wife, the Respondent.

8. In my judgment, in such circumstances, while obviously it is a matter I have considered in the Applicant's favour, I do not believe that an agreement to re-word the original maintenance clause in a way that kept the maintenance at its current level (as I so ordered) would have met all of the Applicant's desires and would, thereby, of itself, have prevented further proceedings.

9. What must be remembered is that the Applicant sought to prove that the Respondent had entered into an arrangement of settled co-habitation with another man and accordingly that she was no longer be entitled to maintenance. In addition, the Applicant sought to show that the Respondent was sufficiently affluent to be able to support herself without the need for further maintenance. In these matters the Applicant was not successful.

10. I do agree, on the papers handed to me, that the Respondent appears to have done little to isolate issues and attempt to settle them without court proceedings. But, with respect, the Applicant is not entirely free of culpability in this regard either.

The Respondent's case

11. It is, in broad sweep, the Respondent's case that, while there may have been a technical restructuring and while the matter of the Applicant's responsibility for meeting Gemma's university costs and subsistence may have been formalised, my judgment supported her in respect of the substantive issues. Accordingly she should be entitled to her costs. There is merit in this argument but in family matters costs do not simply follow the cause. There are other matters to consider.

12. One of those matters is the need for both parties to make full and frank disclosure of their respective financial positions and to act always with candour. In this regard, however, I was critical of the wife. More particularly, on page 6 of my judgment, I wrote as follows :-

"In family law matters of this kind it is axiomatic that the parties must show candour in revealing their true financial positions and exercise a high degree of exactness in ensuring the accuracy of what they reveal. The Respondent in this matter has not assisted her cause by failing to meet those standards of candour and accuracy. However, that being said, it is the task of this Court to seek out the true position even if one or both of the parties have failed to reveal it."

13. In my judgment, this lack of candour on the part of the Respondent is not a matter which I can ignore. The need for candour goes to the heart of ancillary relief proceedings. This is summed up in the words of Lincoln J. in Desai v. Desai (1983) 13 Fam Law 46 :-

"His Lordship said that the husband's lamentable reticence in discovery had struck at the very heart of the proceedings which depended on the candour of the parties. He was directed by s.25 of the Matrimonial Causes Act 1973 to take into account the conduct of the parties and all the circumstances of the case, and the husband's lack of candour and inadequate disclosure of his financial situation was conduct of the gravest importance which should be taken into account."

The law

14. The award of costs is, of course, at the discretion of the court. However, in family matters, as I have said, costs do not simply follow the event. It has been said that there must be the need for some starting point and that must be that costs prima facie follow the event. But that statement of principle may be more easily displaced in family than in other civil matters. In short, in matters such as the one I am now considering, the court has a wide discretion. In the leading case of Gojkovic v. Gojkovic [1992] 1 All ER 275 Butter-Sloss LJ said :-

"If the application is contested and the applicant succeeds, in practice in the divorce registries around the country where most ancillary relief applications are tried, if there is money available and no special factors, the applicant's spouse is prima facie entitled to, and likely to obtain, an order for costs against the Respondent. The behaviour of one party, such as in material non-disclosure of documents, will be a material factor in the exercise of the court's discretion in making a decision as to who pays the costs."

15. In exercising its discretion in family matters, the court, in my judgment, is entitled also to pay some heed to the respective financial positions of the parties. In the case before me, it is not disputed that the Applicant is a man of considerable affluence. He is a senior pilot with Cathay Pacific with additional responsibilities for training. He admits a monthly gross income of about $250,000 per month. He has property and an excellent retirement scheme provided by Cathay Pacific. The Respondent, on the other hand, while she does have the interest in her home (which will provide some security for her in later years), works as a real estate agent for an employer and, at the time of the hearing at least, was earning on average monthly salary of $23,500.

The parties' proposals concerning costs

16. The Applicant has conceded that there should be no order as to costs despite the contention that he has been substantially successful and to achieve this success was forced to come to court. The Respondent, however, has argued that the Applicant should pay her costs as well as his own.

My Order

17. In exercising my broad discretion, I have taken into account all those matters to which I have already referred. While it is not a major factor, I cannot ignore the very material discrepancy in the financial position of the two parties nor the fact that, on a day-to-day basis, the Respondent still has the youngest daughter at home with her as well as Gemma during university holidays. Neither child should be prejudiced, even if only indirectly.

18. Against this, I cannot ignore the Respondent's failure at the outset to make full and frank disclosure. Nor can I entirely disregard the Respondent's apparent failure in the correspondence that I have seen to attempt at least to agree what could be agreed and thereby narrow the outstanding issues. From what I have read, the Applicant appears to have made a more concerted effort in this regard.

19. This has not been an easy matter to resolve. However, in the exercise of my broad discretion, I believe the equities dictate that the Applicant should pay his own costs and fifty percent (but no more) of the Respondent's costs. That is the Order I will make.

The Order

20. The Applicant do pay fifty percent (50%) of the Respondent's costs, to be taxed if not agreed.

(M.J. Hartmann)

Deputy Judge of the
Court of First Instance