PM (formerly known as PJ) v. VM (also known as MV)

FCMC 614/2020

[2021] HKFC 154

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NO. 614 OF 2020

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J U D G M E N T

(Suspension of Maintenance Pending Suit and Interim Maintenance)

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Introduction

1.  This is an application by a Respondent husband dated the 25 February 2021, to suspend the order of the court, made only 5 months earlier on the 23 September 2020. In that judgment the court ordered as follows:

 UPON the Respondent’s undertaking to continue to pay for R and Y’s school fees and their school transport costs including school bus fees and Uber/taxi costs.

 IT IS ORDERED THAT: 

1)  Order 4 contained in the court order dated the 6 March 2019 shall be varied in that the Respondent do pay interim maintenance for the two children of the family in the sum of HK$30,000 per month per child, such sum to be backdated to the 12 August 2020 and thereafter to be paid on the 12th day of each succeeding month until further order.

2)  There shall be an order nisi to be made absolute in 14 day’s time that the Respondent do pay maintenance pending suit to the Petitioner for herself in the sum of HK$4,800 per month, the first payment to be made on the 12 October 2020 and thereafter to be paid on the 12th day of each succeeding month until further order.

3)  …

4)  … 

5)  There shall be an order nisi to be made absolute in 14 days’ time that the Respondent shall pay the Petitioner’s costs of and occasioned by this application, on a party and party basis to be taxed if not agreed. There shall be certificate for counsel. The Petitioner’s own costs shall be taxed in accordance with Legal Aid Regulations.

2.  In the husband’s summons dated the 25 February 2021 he asks that:

1.  Paragraph 1 of the Order dated 23rd September 2020 be suspended until further order of the Court and such suspension shall be backdated to 12th August 2020;

2.  Paragraph 2 of the Order dated 23rd September 2020 be suspended until further order of the Court and such suspension shall be backdated to 12th October 2020;

3.  Costs of this application be provided for.

3.  It is of note that the husband had already stopped paying the wife any maintenance prior to the hearing on the 23 June 2020, which was the adjourned hearing that led to the order of the 23 September 2020. Further, he elected on that date, to offer an undertaking to the court to continue to pay for the children’s school fees and their school transport costs including their school bus fees and Uber/taxi costs. It is not clear the extent to which he is still complying with that undertaking. There is no doubt that the husband’s failure to comply with the court order dated the 23 September 2020 has placed the wife under significant financial strain and there is a sense that this may be tactical. 

4.  I should say at the outset that I do not intend to make the order sought by the husband, for the reasons that have been articulated inter alia by the wife in her 11th affirmation dated the 17 March 2021. Reference should also be made to this court’s first judgment dated the 23 September 2020 and this judgment should be read in conjunction with the first. 

The law - Interim maintenance and variations of the same

5.  The law on interim maintenance and variations of the same is set out in paragraphs 9 – 13 of the first judgment. Reference should be made to those paragraphs as necessary. I do not intend to repeat the same here.  

Should the orders for maintenance be suspended as requested by the husband?

6.  The husband sets out his case on variation in his 5^th and 6^th affirmations dated the 25 March and 26 May 2021. This is summarized by his counsel in her written submission dated the 2 June 2021 as follows:

5.   Since the hearing, there have been the following developments:

(1)  H has not been able to generate any further sales in gemstones due to COVID-19. H's last sale was made in January 2020. H has tried selling his stones to local customers but without success. [H's 5th A8-10 [A/Ill]]

(2)  H has not been able to obtain further loans from his family. The last loan from them was made on 30 December 2019 in the sum of HK$120,000 [H's 5th Aff §§13, 22 [A/112-113]; Cheque [B/224]]. See also letter from solicitors for H's parents dated 5 November 2020 declining to extend any further loans to H. [B/235]

(3)  H's savings have depleted and has outstanding legal fees of HK$475,000. [H's 6th Aff §20 [AJ138]]

(4)  In order to reduce his own expenditure, H terminated his tenancy in February 2021. The place was taken up by H's friend and the friend sublet a room to H at HK$6,000 per month. H also persuaded the Children's school to reduce their school fees and settled the same in full. [H's 5th Aff §§18-20 [A/113]]

(5)  H is now relying on loans from friends to get by. He received a loan of $100,000 from VL on 11.2.2020, a loan of $100,000 from WYS and WYL on 30.3.2020 [H's 5th Aff §15 [A/l12]; Cheques [B/227]]. Some of the Children's expenses are settled by his friend, Ms. FL. H's brother has kindly offered to drive the children around. [H's 6th Aff §§17-18 [A/137-138]]

(6) In May 2021, H had a heart attack whilst he was playing badminton and was diagnosed with heart disease. H is still receiving treatments and taking medication. [H's 6th Aff §§13-14 [A/136]; Medical Records [B/294-297]]

6.   In the circumstances, H requires a temporary suspension of MPS until his cash flow situation improves.

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D      Conclusion

9.   In the circumstances, H asks MPS to be suspended with effect from August 2020 until further order of the Court. H undertakes to the Court and W that H will inform W within 7 days of him selling any of the gemstones and provide particulars of such sale to W. Once his health recovers, H will get a job, if by then he is still unable to resume trading his gemstones.

The court has not been informed of any successful sale of gem stones in the intervening period.

7.  With respect and not withstanding these mainly bare assertions, I remain of the view that the husband does have some financial resources at his disposal and that he does have the ability to borrow. He also has an earning capacity. I do not accept many of the further submissions put forward, which only serve to try to undermine the findings that have already been made. The wife makes the following comments in her 11^th affirmation dated the 17 March 2021:

The Respondent’s claim regarding his difficulty in selling the gem stones

6.  The Respondent’s claims that he was “kicked out” from his parents’ business and provided with gem stones worth around HK$14,000,000.00 are not accepted. The value of the business is not disclosed. He has not explained why he was given HK$14,000,000 worth of gem stones and how that formed his “share” of the family business given that he was a shareholder holding 50% shares. The physical location of the gem stones is not disclosed. There is no proper valuation of the gem stones. There is no information as to where the Respondent's clients physically examine those gem stones and where these business deals are negotiated now that the Respondent alleges that the is not allowed to use the office of the family business. No details are provided except a printed stock list prepared by the Respondent. I have elaborated on my reservations about this claim in my previous affirmations filed for my variation application and I crave leave to continue to rely on them.

7.  I also do not accept that the Respondent has had no business at all since January 2020. Even though some of the gem and jewellery fairs are cancelled or postponed, I understand from our common friends that sales continue within the local market in Hong Kong. This is particularly so since local clients are facing difficulty in sourcing gem stones and diamonds from other countries, particularly India and Thailand. Many local jewellery companies therefore turn to the local gem stone dealers for supply. The Respondent also attended a Trade Fair in Hong Kong in November 2020 which he has failed to mention. It is untrue that the entire jewellery and gem business has been in limbo. Indeed, some local gem stones dealers, including the Petitioner’s brother, are still travelling overseas to a number of countries for business and sales, before returning to Hong Kong undergoing quarantine.

8.  the marriage and even at the beginning of the divorce, the Respondent has been using his personal account and SG’s company account interchangeably. He has also transferred the sale proceeds of the gem stones to the company account claiming that it was a “repayment of debts”.  He has also obtained cash to pay off expenses from both accounts. I believe this is still the case. The statements of the only bank account under his name in VM-S.2 do not truly and accurately represent his current financial position. Rather peculiarly, the Respondent’s use of his only bank account dropped drastically and abruptly in August 2020 which happens to be the time when he ceased financial support to me and the Children. There are only one to two transactions per month since August which is abnormal. This appears to be a contrived arrangement set up by the Respondent to keep the Court in the dark as to his true income and outgoings and to falsely represent his financial position. The Respondent also has not provided his November 2020 statement. Although claiming that his only income for the whole 2020 is the HK$410,000 from the sale of gem stones, the Respondent has failed to explain the source and the reason for the deposits HK$23,000 and HK$50,000 via ATM transfer in March 2020.

9.  In fact, this is also consistent with my belief that the Respondent and his family use cash extensively. I am aware that they normally have stacks of cash at their disposal. I am also aware that it has also been the general practice by the Respondent’s family to use and accept cash for sales. The Respondent is not being transparent about the amount of cash in his custody throughout the proceedings. During the marriage, as detailed in my 2^nd Affirmation, the Respondent paid for the family expenses in cash including giving me cash allowance to buy luxury items. In the past when the Respondent indulged me by buying luxury goods this was frequently by cash payments. For example, I paid for my Chanel (HK$42,900), Miu Miu (HK$11,500) and Gucci ($14,800) handbags all in cash back then.

10.  The Respondent is silent in his Affirmation as to how he pays his other expenses including for rent, his domestic helper, the utilities and food and groceries and the like since August 2020. He obviously has not paid these expenses using the money in his bank account. The Respondent also does not address how he managed to persuade the children’s school to accept reduced school fees, the amount of reduction and how he managed to settle the reduced school fees. I have not received any updates from the children’s school regarding the outstanding school fees or any receipts.  The Respondent has been dealing with the school directly all along keeping me out of the correspondence and meetings.  Upon making enquiries, I discovered that the Respondent has also settled after expenses for the children including Y’s Maths, English &Art classes at Eye-level in December 2020 (one-off payment of around HK$4,000) and Y’s school bus fees since September 2020 (a total of HK$7,344). Not surprisingly, I am told that he settled these amounts in cash.

Needless to say the husband disputes the wife’s version of events.

Conclusion

8.  This remains a highly conflicted case. There is a sense that the parties will fight it out to the end. In such circumstances it seems very unlikely indeed that any court will be able to come to an established view until there has been a full trial and all of the evidence has been properly tested. In the meantime, it is imperative that the wife and children are maintained appropriately. It is of note that the husband makes no proposals in that respect save for the suggestion that the wife may have inherited from her recently deceased parents and that she can earn her own living. In the meantime, little is said about the children’s ongoing needs. This is unacceptable.      

Final orders and directions

9.  Consequently, I shall make an order as follows:

   i)  The husband’s summons dated the 25 February 2021 shall be dismissed.

   ii)  The Respondent do pay the Petitioner’s costs of and incidental to the summons dated the 25 February 2021, such costs to be taxed on a party and party basis if not agreed. There shall be Legal Aid taxation of the Petitioner’s own costs. There shall also be certificate for counsel.