AEM v. VFM

CACV 216/2011

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 216 OF 2011

(ON APPEAL FROM FCMC 4070 OF 1990)

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D E C I S I O N

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1. The husband applies for leave to appeal to the Court of Final Appeal against our judgment dated 28 January 2013. Reliance is placed on section 22(1)(b) of the Court of Final Appeal Ordinance (Cap. 484) in respect of the ‘great general and public importance’ ground and also of the ‘or otherwise’ ground.

2. In respect of the first ground, the following six questions are framed for consideration :

1)   Whether the factors to be taken into account when assessing an application for a variation of periodic payments (maintenance) differ depending on whether the application is (a) to reduce the monthly amount of periodic payments due to the improved financial position of the payee or (b) to increase the monthly amount of periodic payments due to the improved financial position of the payer.

2)  Whether, and the degree to which, improvements in the financial position of a party making periodic payments should be taken into account when assessing an application to vary the periodic maintenance payments, where the improvements in financial position arose many years after the termination of the marriage and involved no contribution by the payee.

3) Whether, on the assumption that the original settlement and order made between the parties was fair and appropriate, it is fair on any potential variation of periodic payments to take into account capital arising from later earned income without discounting it to reflect that fact.

4) Whether, and the degree to which, a disparity in the parties’ financial positions should be taken into account when assessing an application to vary periodic payments, where the disparity in financial position arose many years after the termination of the marriage and was the result of one party electing to continue to earn income while the other party elected not to.

5) Whether when considering the overall fairness between the parties on an application to vary periodic maintenance payments it is proper to take into account the lifestyles led by the parties in the years since the termination of the marriage, particularly where one party had elected to work and the other had elected not to.

6) Whether the contribution which ought to be payable by a partner of the former spouse should be calculated by reference to what is actually paid or what should be payable, and whether questions of affordability are limited by a review simply of what the partner says he or she is spending or can the question include a review of what he or she should be spending.

3.  The first question is simply not engaged in the present case.  The merits of the husband’s application to revise downwards the periodical payment was, of course, the issue we had to address in our judgment but the principles we have adopted are those which are applicable generally on variation applications.  Any statement that a different test is to apply is by way of comments only. 

4.  Questions 2, 3 and 4 are all related to the question of time.  This must be fact sensitive.  In any event under the current law the length of time that had elapsed between the determination of the marriage and the application for variation is not considered to be a limiting factor.  The Court is required to look at the overall circumstances of both the husband and wife.

5.  Questions 5 and 6 are clearly fact sensitive.

6.  In our view the husband has not satisfied the first ground.

7. In respect of the second ground it is said that this Court had exercised the discretion without identifying any error on the part of the judge below; this Court had erred in holding the husband’s financial position had improved when the wife herself conceded that he had not; there was a calculation error in respect of the income of the wife’s cohabitee and this Court had ignored the wife’s concession that her periodical payment would fall to be reduced when she received her inheritance.

8. The error we had identified was that the Judge below had erred in principle by not properly taking into account the principle of fairness.  The whole basis of the wife’s challenge to the judgment on downward variation was based on the improved financial position of the husband which was supported by the evidence.  Certainly it had not been argued before us that the husband’s position had become worse since the application.  As to the wife’s inheritance it was accepted by the wife that it was one of the factors to be taken into account but the Court still has to consider the overall circumstances of the case.  The contention of wrong calculation is not clearly set out.

9. We are also of the view that ‘or otherwise’ ground is not established.  Accordingly the application is refused with costs to the wife.