AYST nee AYSC v. DT

FCMC 17300 / 2013

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 17300 OF 2013

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JUDGMENT
(Interim Maintenance for children)

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Introduction

1. This is an application by the Petitioner (“the Wife”) for interim maintenance for her two children of the family namely, RBT, a girl aged 7 (“R”) and DT Jr, a boy aged 5 (“D”) under Section 5 of the Matrimonial Proceedings and Property Ordinance, Cap 192 (“the MPPO”) against the Respondent (“the Husband”).

2. The Wife issued an Inter-Partes Summons on 13 February 2014 seeking interim custody for the said children and interim maintenance for the said children at the rate of USD 1,500 per month (i.e. USD 750 per month per child) as well as arrears of maintenance from 1 September 2010 to 28 February 2014 from the Husband.

3. Counsel for the Husband has rightly pointed out that there being no order for maintenance the question of arrears cannot arise. Counsel for the Wife confirmed at the outset of this hearing that the Wife would not be pursuing any arrears of maintenance and would only proceed with her claim for interim maintenance for the two children backdating to the date of the Petition i.e. 3 December 2013.

4. The Wife has made an open offer at the outset of the hearing of USD1,000 per month i.e. USD500 per month per child, backdated to 3 December 2013.

5. Counsel for the Husband informed the Court that the Husband’s open offer was HK$1,000 per month i.e. HK$500 per month per child (or approximately USD65 per month per child) backdated to 3 December 2013.

6. The First Appointment hearing and Children’s Appointment hearing was adjourned to 5 June 2014 and this hearing is in relation to interim maintenance for the said children of the family only. 

7. However, it has come to my attention that both parties have already incurred a disproportionate amount of legal fees at this early stage of proceedings, in respect of custody and access matters which are highly contested.  The Wife incurred about HK$62,000 and the Husband about HK$265,406.20 todate.  It is not disputed that the current total monthly expenses of the two children (excluding accommodation expenses) are about HK$21,000. Obviously, the parties’ financial resources can be better utilized to meet the needs of the two children, one of whom is apparently diagnosed with Autistic Spectrum Disorder and requires special attention and treatments, if the parties can reach a speedy resolution on custody, access and maintenance issues in relation to the said children.

8. I appreciate that both parents have different views and preferences on children’s education and care arrangements, and they have both demonstrated their love and care for the said children despite their differences.  I sincerely hope they will be able to make appropriate compromises so that they can move forward in their co-parenting journey amicably without resorting to protracted litigation, which would cause much distress and loyalty conflict in the said children, particular the elder child who is at the age where she is capable of sensing any tension between her parents regarding her welfare.

The main issues

The main issues to be determined are namely:

i)  whether or not the Husband has the ability to pay any interim maintenance to the Wife for the two children of the family on a regular basis and if so, the appropriate amount or apportionment to be borne by the parents respectively; and

ii)  whether or not the Husband’s expenses to travel from Thailand (where he is currently residing) to Hong Kong to maintain regular monthly access to the said children are reasonable and should take precedence to his contribution towards the reasonable needs for the said children.

The Law

9. The Court has power to make an interim maintenance order for the children of the family as set out in Section 5 of the MPPO and read together with Rule 78 of the Matrimonial Causes Rules Cap.179. 

10. The governing principle in such applications, similar to maintenance pending suit (“MPS”) applications under Section 3 of the MPPO is that the court will make such order as it considers reasonable in all of the circumstances of the case.  The overriding principle in applications for MPS and interim applications is “reasonableness” which is synonymous to “fairness” as set out in HJFG v KCY [2012] 1 HKLRD 95.

11. Hartmann JA (as he then was) quoted Nicholas Mostyn QC, sitting then as a Deputy High Court Judge, in TL v ML [2006] 1 FLR regarding the relevant principles in such applications:

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

(i) The sole criterion to be applied in determining the application is “reasonableness”, which is synonymous to “fairness”.

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

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

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

38. Finally, it is to be noted that in applications for interim maintenance, when the amount to be paid is for a limited period only and not all of the evidence is necessarily before the court, it is not appropriate, nor indeed in most cases possible, for the court to conduct a detailed investigation into the finances of the parties.  While, in order to determine what is or is not reasonable, some analysis is always required, that analysis can be conducted on a ‘broad-brush’ basis.”

12. Thus, it is well established that MPS and similarly interim maintenance applications are approached on a broad-brush basis and a detailed examination of the parties’ respective means will be considered at a later stage in a full ancillary relief hearing if agreement is not reached in the meantime.

13. Further, any under provision or over provision can always be corrected at the substantive hearing when there will be every opportunity to do fairness by set-off. In other words, if there is any overpayment or underpayment, the figures can be put right in the final order. (Rayden & Jackson: Divorce and Family Matters (18^th Edition) at para 16.18 and AEL v MRL [2009] HKFLR p.131)

14. Thus, the court in determining what is the appropriate order for MPS and interim maintenance applications under Sections 3 and 5 of the MPPO, will need to consider a) the reasonable and immediate needs of the spouse and the children of the family seeking maintenance; b) the standard of living enjoyed by the parties previously; and c) the paying spouse’s ability to pay on an interim basis, adopting a broad-brush approach to achieve fairness without going through a detailed examination of the parties’ respective means. 

Brief Background

15. The Wife was born in April 1973 and is now aged 41. The Husband was born in July 1973 and is now aged 40. The parties met in the United States of America and were married in the State of California, U.S.A. in July 2004.

16. R was born in U.S.A. in January 2007 and D was born in the U.S.A in March 2009.  In August 2009, the Wife and children moved to Hong Kong and at the same time the Husband moved to Thailand to work in the Tourism industry.

17. Since 2010, the Husband has been in a relationship with a woman in Thailand and they have a son, R who is now aged 3 and together the 3 of them live together with a nanny in a 6 bedroom apartment provided by X International in Thailand.

18. The parties separated since around January 2013, and the Wife issued a divorce petition based on the Husband’s unreasonable behaviour on 3 December 2013 (“the 2013 proceedings”) and the Wife took out an inter-partes summons for interim custody and interim maintenance of the said children on 13 February 2014.  

19. Subsequently, the parties agreed to present a Petition based on one year separation by consent.  Pursuant to the Order made by Her Honour Judge Melloy on 17 February 2014, it was ordered inter-alia, that the 2013 proceedings be stayed on the filing of the new Petition save for maintenance pending suit/interim maintenance summons dated 13 February 2014.

20. The Wife is working in Hong Kong as a senior consultant/counsellor with an income of HK$46,314.62 per month according to her Form E dated 7 February 2014. She also received HK$8,522 over the past 12 months from her private practice (roughly HK$710 per month) and a monthly disability allowance for D in the sum of HK$1,450.  According to her tax return for the year from 1 April 2012 to 31 March 2013, her total income was HK$507,727 or an average of HK$42,310.58 per month. (B1:32 & 82) 

21. The Husband is working and residing in Thailand as a manager for a tourist service company with an income of THB50,000 equivalent to HK$11,817.24 per month plus benefits which include a 6 bed-room apartment, free internet, cable TV, water and other utilities which the Husband valued at approximately USD1,000 per month.  [B1:5, 101 and 111]

22. The Husband also receives an average income of USD1,000 per month from his part-time work for a U.S.A. based charity organisation equivalent to HKD7,762.00 rendering a total income of about HK$19,580 per month in addition to the housing and other benefits as mentioned in the preceding paragraph above .

23. R is attending primary one at a well established local girls’ school in Hong Kong and D is attending a local kindergarten catered for children with special needs since he has been diagnosed with Autistic Spectrum Disorder. 

24. The Wife claims that the specific monthly expenses for the said children are around HK$20,980 per month and together they have been residing with her mother in a 3 bedroom, 1,900 sq feet apartment on Argyle Street, in Mongkok, Kowloon (“the Kowloon property”) since around March 2013 free of rent. 

25. The Kowloon property is owned by the Wife’s mother and although the Wife does not pay rent to her mother, she pays HK$5,000 per month to her mother plus utilities of about HK$1,000 and two domestic helper’s fees of about HK$7,720 per month as additional expenses.

26. The Husband does not dispute that the specific monthly expenses for the said children in the sum of about HK$20,980 per month but argues that the Wife did not need to pay for the additional expenses of 2 domestic helpers and as far as he is aware, one domestic helper was already employed by the Wife’s mother before the Wife and said children moved in. 

27. The Husband’s main contention is that with his limited monthly income, he is unable to afford to pay regularly towards the said children’s maintenance, particularly when he has to incur substantial travelling and hotel expenses to Hong Kong so as to maintain regular monthly access to the said children, which is very important to him and in the best interest of the said children. 

28. As an indication only, of how substantial those travelling and hotel expenses are, Counsel for the Husband submitted at the hearing, a copy each of the electronic air ticket dated 13 November 2013 and hotel receipt from Y Hotel in Hung Hom, Kowloon dated 11 October 2013 for a Y Club Harbourview Room, amounting to approximately THB14,050 for a round trip ticket from Bangkok to Hong Kong and HK$10,626 for 4 nights’ hotel accommodation at the said hotel which according to the Husband is located near to where the Wife and said children are currently residing at.  [Exhibit R1]

29. Counsel for the Husband acknowledged that although there are cheaper alternatives to hotel accommodation, the Husband chose the Y Hotel due to its proximity to the Wife and children’s current residence and his wish to provide a good living environment for the children when they stay with him during his visits to Hong Kong.  He therefore proposes that he can only afford to pay a notional sum of HK$500 per child per month on an interim basis.

The Children’s specific monthly expenses and the Wife’s expenses

30. According to the 4^th Affidavit of the Wife dated 25 April 2014 and submissions at the hearing, the said children’s specific monthly expenses excluding accommodation expenses are about HK$20,980, the breakdown of which is as follows:

For both children
School Fees	$1,000
Food	$4,000
Travelling expenses	$1,000
School books and stationery	$500
Medical/dental	$1,000
Clothing/Shoes	$1,000      $8,500
For D
Speech therapy	$3,000
Occupational therapy	$3,200
Swimming classes	$1,320      $7,520
For R
Mandarin classes	$760
Chinese classes	$300
Phonics, viola & dance classes
at school ($300+600+300)	$1,200
Private Chinese tutor	$1,000
Private Piano lessons	$600
Private Maths tutor	$1,200      $4,960
Total:	$20,980

31. According to the Wife, she also paid an additional one-off payment of HK$15,000 for a treatment program of 40 injections for D to get rid of the excess mercury and lead inside his body over a period of 7-8 months. 

32. The Wife’s monthly expenses as set out in her Form E dated 7 February 2014 are about HK$27,070.  Thus, the total monthly xpenses for herself and the children are about HK$48, 050 ($20,980 + $27,070). 

33. Having regard to the all the circumstances and the living standard that the said children are accustomed to, I am of the view that the monthly expenses of HK$20,980 is reasonable. 

34. I also accept the Wife has had no alternative but to take up full time employment so that she can support herself and the two children in the absence of regular maintenance from the Husband.  I also find the Wife’s monthly expenses of HK$27,070 is reasonable and appreciate that this figure may go upwards if she has to move out from the Kowloon Property and pay market rental for a suitable accommodation for herself and the two children.

35. Without going into a detailed examination of her means, the Wife does not appear to have substantial assets and have been relying on the support of her mother and sister for her accommodation and general expenses.

Discussion and Analysis

36. According to the Husband, it was clear to him that the marriage had broken down irretrievably by 2009.  He therefore told the Wife that he would move out and live his own life and see other people. He moved to Thailand in around August 2009 due to work commitments and the Wife moved to Hong Kong with the said children to be closer to her maiden family.

37. According to the Wife, in around August/September 2010, the Husband insisted that she rent a serviced apartment as their home in Z, Hung Hom at the rental of HK$15,000 per month and promised to pay for the said rental. 

38. However, when the Husband failed to pay any rent for the said serviced apartment, the Wife said she had to terminate the tenancy and moved into her mother’s apartment together with the said children, so that she can save on rent and other miscellaneous expenses. The Wife alleges that she had to borrow money from her sister to settle her credit card fees and still owes her sister a sum of about HK$350,000. 

[B1:88, 90]

39. According to the Wife, the Husband had promised to pay USD1500 per month for the maintenance of the said children.  However, from November 2010 until October 2013, the Husband has only transferred irregular amounts payments of various amounts to the Wife in the total sum of $193,007.51 or an average sum of approximately HK$5,361.32 per month. 

40. The Husband denied ever insisting the Wife to rent the serviced apartment in Z, Hung Hom, Hong Kong as alleged by the Wife and there was no official agreement or arrangement between the parties regarding the maintenance for the said children.  However, he would give approximately USD1,000 per month, sometimes more or less, to support the said children. [B1:101 &248]

41. Counsel for the Husband says that the Husband’s case is not that he shouldn’t pay any maintenance for the said children of the family. However, since the parties have not been able to resolve custody and access issues in relation to the said children, he needs to travel to Hong Kong regularly and incur substantial travelling and hotel expenses, roughly over HK$14,000 per trip per month, although it may not always be the same amount, he is not in a position to pay anything more than HK$1,000 per month for the two children i.e. HK$500 per month per child on an interim basis, backdated to the date of Petition i.e. 3 December 2013.  On the other hand, he claims that the Wife is able to meet the financial needs of the two children on an interim basis.

42. The Husband does not dispute he received an inheritance of approximately USD166,432.64 (roughly HK$1,289,852.96) in 3 tranches between August 2013 and November 2013 and a further sum of USD36,000 which he received sometime after November 2013.  However, he alleges in his said Form E and Affidavit dated 10 March 2014 that he has used up the inheritance to pay off personal debts, give to charity and spend time with his kids and has no money left.   [B1:115,248]

43. According to the Husband’s Form E and Form J, the family enjoyed one to two holidays per year and although his son has autistic spectrum disorder and not involved in many extra-curricular activities, his daughter enjoyed a variety of extra-curricular activities and has travelled around the world with him, including, Africa, Japan, USA, Australia, Thailand etc. [B1:5,115]

44. Further, according to Part 4 of his Form E, the Husband’s monthly expenses amount to HK$22,475.  However, this excludes his legal fees which he anticipates to be around HK$30,000 to HK$50,000 per month.  The Husband alleges that although he does not have the means to pay the said legal fees, he may have to take out a loan in order to pay for his legal fees, some of which remains unpaid.

45. The Wife doubts that the Husband is working as an employee earning only THB50,000 per month or a sum equivalent to HK$11,817.24 per month. She believes that the Husband is in fact the owner or partner of the company/business since she finds it incredible that any employer would provide a staff earning HK$11,000 per month with benefits such as a 6-bedroom accommodation free of charge, a live-in nanny, utilities, meals, education for his children etc.

46. Further, the Wife believes that the Husband has access to more funds than he has disclosed in his Form E, otherwise he would not be able to take the children on overseas holidays and propose that if the said children were to move to Thailand and live with him, he will arrange for them to study in a top international school, which is quite expensive albeit he alleges that such fees will be covered by his company if the said children moved to reside with him in Thailand. 

47. Counsel for the Wife also referred to the Husband’s bank statements from Bangkok Bank between July 2013 to January 2014 to show that a large number of deposits totalling over HK$500,000 were made into the Husband’s bank account during that period, in addition to the said inheritance of about USD166,432.64 (roughly over HK$1,200,000) which was deposited into the Husband’s Wells Fargo Bank.  Further, the bank statements disclosed by the Husband did not show any income of THB50,000 being deposited into his bank accounts.

[B:128-136, 159,164,169]

48. Although the aggregate balance in all the Husband’s bank accounts was only about HK$11,962.96 according to the Husband’s Form E filed in February 2014, the Wife therefore finds it incredible that the Husband has used up all his inheritance and is only earning what he alleged in his said Form E.  [B:104]

49. Counsel for the Wife referred to the judgment of Nicholas Mostyn QC, sitting then as a deputy High Court Judge in TL v ML [2006] 1 FLR 1263. 1289 where the affidavit or Form E disclosure by the Husband is obviously deficient, the court should not hesitate to make robust assumptions about his ability to pay.  

Conclusion

50. Having regard to all the circumstances of this case, I find it rather difficult to accept the Husband’s case that he is unable to pay anything more than a notional sum of HK$500 per month per child on an interim basis. 

51. On a broad assessment and without a detailed examination of the Husband’s means, I am of the view that his alleged monthly expenses of HK$22,475 and general lifestyle, does not appear consistent with his alleged total earnings of about HK$19,580 per month (i.e. HK$11,817.24 + USD1,000 from his part-time work for a U.S.A. based charity).  It is therefore likely that the Husband has access to financial resources sufficient to cover his alleged monthly spending of HK$22,475 as set out in his Form E or he has the ability to raise loans of about HK$30,000 per month, be it to pay for his legal expenses, travelling and accommodation expenses or to support himself and the children’s specific monthly needs, but this is a matter which can be dealt with at the final hearing.

52. Whilst I agree that it is important and in the best interest of the said children to maintain regular access with their father, and the Husband may have to incur additional travel and hotel expenses from Thailand to Hong Kong when he visits the said children, I am of the view that these expenses should not take precedence to his contribution towards the reasonable needs for the said children. 

53. Bearing in mind that I am only dealing with an interim maintenance application and any overpayment or underpayment can be corrected at the substantive hearing, I am of the view that, adopting a broad brush approach and having regard the overall net available income of the parties, it is fair and reasonable for the Husband to contribute to the specific monthly expenses of the said children in the sum of USD750 per month or HK$5,800 per month i.e. USD375 or HKD$2,900 per month per child on an interim basis.  This reflects roughly 27% of the children’s specific monthly expenses of HK$20,980. 

54. For reasons stated above and having regard to all the circumstances, including the living standard that both parents and the said children are accustomed to, I am of the view that the Husband has the financial ability to pay an interim maintenance of USD750 or HK$5,800 per month i.e. USD375 or HK$2,900 per child per month backdated to 3 December 2013 until further order. 

55. My order is thus:

The Respondent do pay to the Petitioner interim maintenance for the said children in the total sum of USD 750 or HK$5,800 per month i.e. USD375 or HK$2,900 per month per child, commencing 3^rd December 2013 and thereafter payable on the 3^rd day of each succeeding calendar month, until further order.  The above payment shall be credited by the Respondent into a bank account designated by the Petitioner.

Costs

56. Taking into account all the circumstances, and given that neither party has been wholly successful,  I am of the view that the appropriate costs order shall be no order as to costs, with certificate for Counsel.  This is an order nisi which will be made absolute within 14 days, unless there is an application to vary the same.