FHP v. YPY (formerly known as YSL)

FCMC 15966 / 2010

[2019] HKFC 296

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 15966 OF 2010

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J U D G M E N T
(Variation of maintenance and discharge of undertaking)

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Introduction

1.  This is an application by a Petitioner husband to reduce the periodical payments payable to the wife from HK$42,000 to HK$10,000 per month. In addition, he seeks to be released from his undertaking to pay the wife an additional sum of HK$30,000 as a Christmas gift, such sum to be paid before the end of December each year. The husband’s summons dated the 29 November 2017 states as follows:    

1.         Paragraph (i) of the order made by Her Honour Judge Melloy on 8^th July 2011 be varied to:-

“The Petitioner shall pay the sum of HK$10,000 per month to the Respondent as her maintenance. The said monthly payment shall be paid into the Respondent’s bank account no. XXX-X-22XXXX maintained with Hang Seng Bank. Such payments shall be paid on the first day of each calendar month until the Respondent’s remarriage or during the joint lives of the parties, whichever is the shorter.”

2.         The Petitioner be released from the undertaking dated 8^th July 2011 to give the Respondent a sum of HK$30,000 as Christmas gift every year payable before the end of December until the Respondent’s remarriage or during the joint lives of the parties, whichever is the shorter;

2.  In summary, this case concerns an application to vary an order for maintenance, in circumstances where it is acknowledged that much of the wife’s maintenance has been used historically to support a child, who is not a child of the family. There are also other issues concerning inter alia the earning capacity and the other financial resources of both of the parties and their respective needs going forward.   

Background to the marriage

3.  The parties met in 2007 and married shortly thereafter on the XX November 2007. On the XX April 2008, the only child of the family, a boy called FMF was born. He is now 11 years of age. On the 30 September 2009 the parties subsequently separated. This then was a very short marriage of less than two year’s duration that produced one child. The wife, who was born in January 1986, was only 21 years of age at the time of the marriage. Notwithstanding that, she had already had two other children, two daughters, the eldest of whom features in the current application. Her name is NC and she is now 18 years old and is studying in the United Kingdom. She will take her A’levels in the summer of 2020. It was acknowledged during the trial that NC is not and never has been a child of the family. She did not live with the parties during the marriage, she was mainly taken care of by the wife’s mother and no orders were made or sought in respect of her in the parties’ divorce proceedings. The other daughter does not feature at all and it seems that she has always been taken care of by her father’s family. The wife appears to have no relationship with her. It is of note that the wife only conceded that NC was not a child of the family very late in the day and that originally she had argued that she should be regarded as being a child of the family.

4.  It seems that there were ongoing negotiations following the separation, which led initially to a Deed of Separation being entered into. This is dated the 29 October 2010. This was followed by two consent summonses the first dated the 17 December 2010 and the second dated the 25 January 2011. The husband had filed for a divorce on the 3 December 2010. We are only concerned with the second consent summons in this judgment. On the 28 January 2011 the husband was granted sole custody and care and control of FMF by agreement, with reasonable access to the wife. FMF has lived with him ever since and he is now largely taken care of by the husband and his second wife, whom the husband married on the XX February 2014 and a domestic helper.

5.  On the 8 July 2011, the court ordered, in accordance with the second consent summons, that the husband do pay the wife periodical payments of HK$42,000 per month until the wife’s remarriage or during the joint lives of the parties, whichever is the shorter, plus a lump sum of HK$1.7 million. In addition, a property, known as the “Lam Tin” property, was also transferred to the wife at nil consideration. This was subject to the Housing Authority’s approval, which was subsequently granted. Further, the husband undertook to pay the wife HK$30,000 per annum, before December of each year as a “Christmas gift”. Again this undertaking was effective until the wife’s remarriage or during the joint lives of the parties, whichever is shorter. The order does not state the purpose of the “Christmas gift”. The section 18 declaration was made on the 31 August 2011 and the decree absolute was granted on the 4 November 2011.  

6.  In September 2012, about a year after the divorce, the husband gave up his job as a bank officer as he wished to study to become a Chinese Medical Practitioner like his father. It is common ground that he has not worked in a paid capacity since that time. He took the exams in August 2018, but unfortunately he did not pass all of the components. At the time of the trial it was his intention to retake the exams in August 2019. It is not known whether or not he has now passed those exams. The husband is now 44 years of age.

7.  The wife for her part was working as a bar tender when she met the husband. It is accepted that she has also not worked since the marriage and that she is totally reliant on the husband’s maintenance for her financial support. She says that she has had some depressive issues in the more recent past which also affects her ability to work. The wife is now 33 years old.  

8.  It is of note that the husband’s second wife DOES work. She is also a bank officer and she earns a modest income and has some of her own savings. She and the husband have also had a child, a little girl who was born in June 2014 and is now 5 years of age.

Each party’s case

9.  It is the husband’s case that there has been a significant change of circumstances which necessitates a variation in the maintenance payments and the discharge of his undertaking. It is of note that he is not seeking for the reduced maintenance to be paid for a defined period of time. Although he raised some other issues concerning duress and other related arguments with respect to the original Deed of Separation and the subsequent consent summonses, it is of note that sensibly there was no application to set aside any of these documents, including the final order for ancillary relief dated the 8 July 2011. As indicated during the trial, given that the husband has always complied with that court order and that there is no application before the court to set it aside, it seems that any issues concerning duress and the weight to be attached to the court order, will not really take the matter very much further forward at this stage. Consequently, and as indicated during the trial, the court does not intend to consider these matters in any detail in this judgment.

10.  The wife for her part maintains that there is no proper basis for the husband’s application, that there has been no significant change of circumstance and that the husband should continue to pay her maintenance as before. Further she does not agree that his undertaking should be discharged. In so far as NC is concerned she maintains that the husband has a moral obligation to support NC financially and that he was aware of this at the time of the original order.   

The issues

Given that NC is not a child of the family, should the husband be obliged to maintain her and if so on what premise and for what length of time?

Does the wife have an earning capacity?

Should the maintenance payments be reduced from HK$42,000 to HK$10,000 per month? Or should the maintenance be reduced to some other sum?

Should the husband’s undertaking to pay the wife a “Christmas gift” in the sum of HK$30,000 per annum be discharged?

The law

Variation of maintenance

11.  The husband’s application to vary is made pursuant to section 11 (7) of the Matrimonial Proceedings and Property Ordinance Cap. 192, which provides that:

“(7) In exercising the powers conferred by this section the court shall have regard to all the circumstances of the case, including any change in any of the matters to which the court was required to have regard when making the order to which the application relates ……”

12.  It is accepted that in considering a change of circumstances, I may look at the case de novo. In other words, the court is not necessarily fettered by the existence of a previous order. I may look at the situation afresh and make an order based on the parties’ existing financial circumstances. (See Ch 3.131 Jackson’s Matrimonial Finance and Taxation, 7^th edition). It is also true that there would normally be a reason for the application to vary or what some might call a “trigger”.

13.  The court has a very wide power, including a power to terminate payments and to backdate the variation ordered. The overall objective is to achieve a fair outcome (see M v M, FCMC 4070 of 1990, dated 12 May 2006, unreported).

14.  The correct approach was summarized by the Court of Appeal in AEM v VFM [2008] HKFLR 106. In that case the Hon Cheung JA made the following point when setting out the law. Referring in particular to agreements reached by consent he said:

8.         At the same time the basis and intended effect of the original order are relevant factors to which the Court on variation should pay regard and there should not be a radical departure from the approach taken by the parties themselves when they had entered into an agreement embodied in a consent order: Boylan v. Boylan [1988] FLR 282.

The law

Discharge of undertakings

15.  In so far as the undertaking is concerned, it is not disputed that the court cannot impose an undertaking on a party nor can it vary an undertaking of its own motion. The court may accept an undertaking; it may discharge an undertaking and it may, in some circumstances refuse either to accept an undertaking or to discharge it.

16.  This issue was recently reviewed by the UK’s Supreme Court in the case of Birch v Birch [2017] WLR 2959. Lord Wilson, who gave the lead judgment, essentially reiterated what has been said in the above paragraph, namely that the court has no power to vary an undertaking. It may however release a party from an undertaking upon the offer of a new one, which may look like a variation – but it is not. At paragraph 5 he said as follows:

“A court has no power to impose any variation of the terms of a voluntary promise. A litigant who wishes to cease to be bound by her (or his) undertaking should apply for “release” from it (or “discharge” of it); and often she will accompany her application for release with an offer of a further undertaking in different terms. The court may decide to accept the further undertaking and, in the light of it, to grant the application for release. Equally the court may indicate that it will grant the application for release only on condition that she is willing to give a further undertaking or one in terms different from those of a further undertaking or one in terms different from those of a further undertaking currently on offer. In either event the court’s power is only to grant or refuse the application for release; and, although exercise of its power may result in something which looks like a variation of an undertaking, it is the product of a different process of reasoning.”

With respect I agree. In this instance the husband makes no further offer and asks simply that the undertaking be discharged. The wife asks that it remain in place.

Financial support of third parties

17.  In his closing submission, counsel for the wife sets out the legal basis for the wife’s claim that the husband should contribute towards NC’s maintenance as follows:

Moral Obligation towards a Dependant

10.       Though it is well-established that there is no obligation to provide for a child who is not of the family as defined under section 2 of the MPPO, the moral obligation of a party towards a dependent is a relevant factor to be considered by the Court in determining the appropriate distribution of wealth between the parties.

11.       Indeed, this was the position laid down by the UK Court of Appeal in Cowan v Cowan [2001] EWCA Civ 679.  It was the view of Mance LJ that:

“… I do not doubt that a moral obligation could in the right circumstances be of relevance, when considering the appropriate distribution between spouses of accumulated wealth. One may, for example, think of a spouse who was, with his or her partner’s knowledge and consent, accustomed to support a parent or siblings or other relatives or a small charity, in circumstances where the relative or charity would depend on further support for the future. Surely, the wish to continue such support would be entitled to some weight, although how much would depend on the other circumstances ... ” (emphasis added)

12.       This principle was also considered and adopted by the District Court in H v T (unrep. FCJA 341 / 2003, 4 June 2007). Deputy District Judge K. Levy (as she was then) said that:

“39. According to the definition section in the MPPO, when a child is not a child of both parties as in this case, a “child of the family” is defined as a child “who has been treated by both those parties (to the marriage) as a child of the family”. For the purpose of determining the Husband’s financial obligations to L, it would be necessary to determine whether L is the child of the family as he is not a child of the parties in this marriage. Such determination is important as a child of the family enjoys the full legal right of maintenance as if he were a child of the parties while a child who is not a child of the parties or being treated as a child of the family will not have the same legal entitlements. Nonetheless, a party may be required to make some financial provisions should the circumstances justify the imposition of a moral obligation on a party towards a child who is neither a child of both parties nor a child of the family as discussed in paragraph 41 below.

41.       ... In some cases, a court – as submitted by Mrs. Nung by referring a passage in a matrimonial textbook – may need to take into account a party’s moral obligation towards a dependent, whether he or she is an aged parent or a child, in the consideration of the matters under section 7 of the MPPO.”

18.  This position is not accepted by the counsel for the husband, who comments inter alia in her Reply that 

6.        Further, W now says that H has a “moral obligation” towards the Daughter, citing the UK case of Cowan v. Cowans.

7.         However, a closer look of the judgment reveals that it does not add anything to W’s case at all.  Cowan did not lay down any rules that any maintenance payer must as a matter of law provide for the other spouse’s child.  Whether or not such payment should be made depends on (i) whether the payment was made “with his or her partner’s knowledge and consent” and (ii) whether the payer was “accustomed”, to providing such financial support: see the paragraph in Cowan cited in W’s Closing §11.

8.         It is after all fact-sensitive and whether an alleged “dependent” is entitled to such financial support must depend on the circumstances.

9.         Here, H was neither accustomed to making such payments, nor was any such payments made by W made with H’s “knowledge and consent”.

10.       Moreover, W is placing a lot of unnecessary focus on the words “moral obligation”, while in fact how “moral” an obligation may be is not a relevant test here - the test is and remains to be whether it was the parties’ practice that such payment be made, or in the Court’s words in Cowan as stated above, whether the payer was “accustomed” to making such payment.

11.       In this regard, there is no difference whether the payment is for a child, an elderly person, or even a charity. The same considerations apply. If a payment has always been made for a certain purpose or to a certain person, such practice certainly carries weight and the argument that it should be continued to be made is sound.

12.       Thus, the Cowan judgment does not add anything at all. Whether or not a payment to a “dependant” should be made depends on the circumstances of each case.

13.       In any event, it goes without saying that UK cases are no longer binding on Hong Kong Courts after 1997.  Also, while Cowan was applied in Hong Kong in H v T, it was merely an obiter and H v. T – being a District court case – is not binding.

14.       W also says that H made this application more than 6 years after the Order in 2011 and that “it is clear that H was aware that W’s expenses included her Daughter’s since their marriage began”.

15.       First of all, it is unclear how H’s taking out this application 6 years after the Order meant he was aware what W’s expenses had included since their marriage.

16.       In any event, H has in the past demonstrated the difficulty for him to pay maintenance on time.  He has delayed payment several times – and this is clearly borne out in the WhatsApp evidence where W is shown to have complained on many occasions H’s late payments.  The said conversation shows that he had indeed been in financial difficulties before the application was taken out.

17.       H has also given evidence that he has not made and would not make enquiries as to how W had spent the money during marriage and after the divorce. He gave the example that even if W had said she needed the money to buy handbags and so on, he would not be bothered with whatever reason W gave, as his main concern was that he had to pay her money.

18.       W also says it is unreasonable for H not to complain to W that W had used the maintenance to pay the Daughter’s tuition fees. H admitted that he did not raise with W on WhatsApp that she should not use the money to pay the Daughter’s tuition fees. And his explanation is two-fold :-

(1) His “focus was on repaying or paying her the maintenance because it was my responsibility to pay her” and he considered that “it was beyond [him] to interfere with her expenses”; and

(2) It was not his practice to discuss such complex issues over WhatsApp.

19.       The above explanation is entirely reasonable.

19.  Whilst I would accept the husband’s position up to a point, the fact remains that in reality the wife used the maintenance from the husband, in part, to pay for NC’s overseas educational costs including school fees, accommodation and flights back to Hong Kong. It seems that she is also likely to have relied on her savings originally in the sum of approximately HK$1.7 million. The husband must have been aware that the maintenance payments were being used to help fund NC’s costs, given that it is also acknowledged that the wife was not working and indeed had not worked in any capacity since the parties’ marriage. Consequently, although the husband may not have a legal, or even a moral obligation to support NC, the reality is that the maintenance he paid was used in part to support NC. It is difficult to comprehend how he could have been unaware of this. Thus, as in H v T, the court cannot simply ignore the reality of the situation, or the fact that the wife, for her part, was both legally and morally responsible for her child’s maintenance, even if the husband was not. The ramifications of this will be discussed in more detail below.       

Discussion

Given that NC is not a child of the family should the husband be obliged to maintain her and if so in what capacity

20.  In the wife’s closing submission the wife stated inter alia as follows:

The Daughter’s expenses

112.     Although the Wife has conceded at trial that her Daughter is not a child of the family as defined under section 2 of the MPPO, by reason of the matters stated in paragraphs 10 to 12 above, it is submitted that the Court should consider the Daughter’s expenses as part and parcel of the Wife’s expenses, and that there exists a moral obligation on the part of the Husband towards the Daughter as he was well aware that the maintenance given to the Wife included her expenses since the beginning of their marriage.

113.     The Wife’s obligation towards her Daughter has been well-established at trial:

(a)   It is not disputed that [Y] NC is the Wife’s biological daughter

(b)   Under cross-examination, it was the Wife’s evidence that she was around 15 or 16 years old when she had her Daughter, and that she does not know the name of her Daughter’s biological father as he had disappeared.

(c)   This is corroborated by the letter from Messrs. Kitty So & Tong, the Wife’s current solicitors, to the Husband’s solicitors dated 17 January 2018; and

(d)   It is therefore impossible for the Wife to seek financial provision from her Daughter’s biological father.

114.     In any event, the Court is urged to pay full regard to the basis and intended effect of the Consent Order, the purpose of which the Wife says is to maintain the expenses of both the Wife and her Daughter.

115.     As such, it is submitted that the maintenance payable by the Husband towards the Wife should account for the Wife’s Daughter’s expenses as well.

116.     In this respect, it is submitted that her Daughter’s expenses are reasonable.

117.     The Daughter’s overseas education expenses is well supported by both oral and documentary evidence:

(a)  The Wife gave evidence that her Daughter is currently studying in the lower 6^th form at the College of X in the UK.  She currently studies Biology, Chemistry and Maths;

(b)  It was upon her Daughter’s wish that she moved from F School to the College of X, significantly reducing the Wife’s monthly expenses from around HK$37,500 to HK$12,500;

(c)  As is evident from the invoice produced by the Wife at trial, she had paid a total sum of £14,985 for the academic year of 2018/19 for her Daughter, which included her both tuition and boarding fees.  These fees where paid annually. This is consistent with the monthly expenses of HK$12,500 as stated in the Wife’s updated Form E;

(d) The Wife pays for her Daughter’s school fees from her Bank of China Sterling Account; and

(e)  There is clear evidence that the Wife did tell the Husband that her Daughter would study abroad, and that the Husband had also told her Daughter to put more effort into her studies.

118.     Further, the Court will also note that apart from the Daughter’s school fees, her monthly expenses are in the sum of around HK$8,295.15.  This is far less than the expenses alleged to be incurred by their Son and the Husband’s daughter, which amount to a sum of around HK$14,652.5.  It is submitted that the Daughter’s expenses are clearly reasonable in this regard.

119.     By reason of the matters aforesaid, it is submitted that the Wife’s financial needs are clearly reasonable and the maintenance payable under the Consent Order is necessary to sustain the those needs.

21.  As indicated above, although the court does accept that the husband has no obligation to support NC, nevertheless given that the wife does have both a legal and moral obligation to support her own daughter and given that this is one of the circumstances in the case, this is not something that the court can simply ignore. Further, the husband acknowledges in his affirmation evidence, that the sum of HK$42,000 per month was originally meant to be for both the wife and the son’s maintenance and that this was more than the wife had originally needed. However, the maintenance has nevertheless been paid for over 8 years. The wife has therefore made her own financial arrangements for NC, based in part on a reasonable expectation that the maintenance would continue.

22.  NC is now 18 years old in any event. She is in her last year of school and is due to take her A’level exams next year. In such circumstances I am of the view that regardless of the fact that there is no legal obligation on the husband to support NC financially, it is reasonable nonetheless to ensure that the wife has sufficient financial resources at her disposal to enable NC to complete her A’levels. Thereafter NC will need to make whatever arrangements she deems appropriate for her future education going forward, either in Hong Kong or overseas. I would not expect the husband to contribute financially towards any of her future study, either directly or indirectly.    

Does the wife have an earning capacity?

23.  The wife has provided court with a letter from her treating psychiatrist dated the 29 May 2018, which states as follows:

29 May, 2018

TO WHOM IT MAY CONCERN

Ref: YPY

    32Y/ Female

The above named lady has been known to this clinic since April 2016. She presented with a month history of depressed mood, insomnia, frequent crying, loss of appetite/ energy/ interest/ concentration, anxiety with hand tremors and palpitation. She was diagnosed to suffer from Depressive Disorder. She was started on Antidepressant and her condition improved over time.

However, her mental condition deteriorated recently despite being on medication with low mood, loss of energy/ interest/ drive, insomnia and forgetfulness, without any precipitant. Her medication need to be increased today.

In summary, Ms Y has been suffering from a Depressive Disorder and has been on medication since April 2016.  Her mental condition deteriorated recently despite treatment. This indicates that her prognosis would only be fair at best and she is likely require extended, if not lifetime, psychiatric treatment.

Thank you for your attention.

24.  In addition, the wife has provided copies of other letters plus receipts for medical consultations and antidepressant medication. In such circumstances I accept that the wife has been suffering from some sort of a depressive disorder since April 2016 and that this may affect her ability to work in the short to medium term. In any event it is not the husband’s case that the wife’s maintenance should only be for a limited period of time, notwithstanding the fact that this was a very short marriage. He is simply asking that a reduced sum be paid to her, until her remarriage, or during the joint lives of the parties. Thus the issue is not how long the maintenance of HK$42,000 per month or indeed any other maintenance sum should be paid, but rather what the maintenance level should be and whether the husband can reasonably afford to pay that sum.  

Should the maintenance payments be reduced from HK$42,000 to HK$10,000 per month? Or should the maintenance be reduced to some other sum?

Change of circumstance

25.  As indicated above the husband is not working and has not done so since September 2012. Since then the husband has been studying in one capacity or another and he has relied on his savings and other financial resources, including his interests in a number of small companies, to support his living. Originally his mother also lived with him and it is his case that she would also contribute towards the household expenses. It is also suggested that his father, the paternal Grandfather, had supported him financially in the past and the wife states that the husband had received between HK$150,000 – HK$200,000 per month from him during the marriage. There is no evidence to support this rather bold assertion and both the husband and the paternal Grandfather deny that any such arrangement existed. Indeed, the paternal Grandfather said as follows in his affirmation dated the 7 February 2018:

10.       I notice that the Respondent claims that I would give around HK$150,000 to HK$200,000 for my son to spend each month during their marriage.  This is not true.  While I had indeed given him money before, it was not a regular payment.  A few years ago, I did give my son sums of about HK$200,000 in cash for a few months.  But those were the only occasions I had done so, and to say that I had done so every single month is clearly an exaggeration.

The paternal grandfather also came to court to give evidence and I found him to be a credible witness. Consequently, I accept what he says in this respect.

26.  It is suggested by the wife that there has been no change of circumstance and therefore that the husband’s application should not be entertained. This is notwithstanding the fact that it is not disputed that the husband originally had an income, as a bank officer, of between HK$42,000 – HK$58,000 per month during the marriage and that this reduced, after September 2012, to approximately HK$30,000 – HK$34,000 per month, being dividend income from his other business interests. He has received no income at all from about March 2016 to date. Further, I accept that he received some financial assistance from both his mother and father during the marriage and that this has now ceased.

27.  Consequently, the difficulty with the wife’s assertion is that it does not really hold up to detailed scrutiny. It is clear, as stated above, that there had already been some change of circumstance immediately following the divorce. Further it is clear that in addition to these changes, there were also other more significant changes and related calls on the husband’s financial resources in the more recent past. In particular, it is accepted that the paternal Grandfather is no longer in a position to offer the husband any form of financial assistance at all. I accept the evidence that was produced in that respect, namely that the paternal Grandfather, who used to be a rather famous Chinese Medical Practitioner, can no longer practice in any significant way, following criminal and disciplinary proceedings, which eventually led to him being suspended from practice for 9 months. These difficulties all arose post the parties’ divorce, with the final judgment from the Court of Appeal being handed down on the 16 June 2017. I accept that not only has the paternal Grandfather been unable to assist the husband financially, but in addition the husband has been called upon to assist him with the payment of some of his legal costs. The paternal Grandfather is also suffering from ill health and has other financial responsibilities of his own. Further the husband has also assisted with some of his medical bills, although it was acknowledged that most of these were covered by medical insurance.

28.  In addition, I accept that any financial assistance that the husband also received from his mother sadly came to an end when she passed away in 2013. I further accept, and indeed this does not appear to have been challenged, that the husband’s mother contributed towards the household expenses when she lived with the parties following their marriage. This also continued for a while after the divorce. The husband also made a significant contribution towards his mother’s medical costs prior to her death, which was not covered by insurance. Again this was a significant call on the husband’s financial resources and led to a further change in his financial circumstances.

29.  Given these additional calls on the husband’s savings and other financial resources, I accept that he has had no option but to borrow a further sum of HK$900,000 as a personal loan. Following the divorce, he had already remortgaged the former matrimonial home in order to pay the wife the lump sum of HK$1.7 million referred to above. 

30.  Thus I accept that there has been a significant change in the husband’s financial situation since the divorce. In addition, he has remarried and had a further child. In any event, it is clear that in the present case and when considering the change of circumstance outlined above, that it is appropriate to look at this case de novo.      

Income and other financial resources of the parties

The husband

31.  As indicated above the husband has no current income, either from paid employment or from other business ventures. He owns the former matrimonial home, which he has re mortgaged, allegedly to the maximum possible. (However, even if this were not the case it is difficult to see how he could currently service a bigger mortgage in any event). He also owns a property previously used by his father as a clinic together with another property in China. The clinic was also re mortgaged in 2014. He has some cash (approximately HK$200,000) and some stocks and shares (approximately HK$1,140,000). I accept that he needs somewhere to live and that selling the former matrimonial home really should be a last resort. Similarly, I also accept that it would make sense to try to keep the clinic so that he will hopefully be able to run his Chinese Medical practice from there in due course. I further accept that none of his other business interests are currently profitable. He will receive an inheritance from his mother’s estate in due course and this should assist. But in reality he is currently relying on what little cash he has left, the stocks and shares and his potential inheritance. These funds will not last long, even if the wife’s maintenance is reduced. Currently the husband says he has outgoings of over HK$175,000 per month inclusive of the wife’s maintenance. This is clearly unsustainable longer term.

Earning capacity

32.  The husband estimates that if he passes the medical practitioner exams that he could, at best, earn in the region of HK$100,000 per month. This is clearly more than he was earning before, but even then it does not cover all of his outgoings. Clearly he will need to restructure his asset base in some way or earn more or make other adjustments as necessary. Even if an order is made in the terms that he seeks, he will not be able, on his case, to live off his anticipated income.  

The wife

Financial resources

33.  The wife has an unencumbered home that she holds in her sole name and some savings (just over HK$800,000 as at the date of the Form E dated the 9 May 2019).  

Earning capacity

34.  In so far as the wife is concerned, as indicated above, it is accepted that in the short term she only has a very limited earning capacity. Longer term however, she should be able to earn something, although even then it is likely to still be quite limited given her educational background. She only completed Form 3 and has no other qualifications. However, it is not accepted that she does not have any earning capacity at all. She is still relatively young and she can look to further educate or retrain herself with a view to re entering the work force in some capacity in due course. It is accepted that this will also be dependent on her depression lifting sufficiently to enable her to do this.  

How much maintenance does the wife need? 

35.  It was the husband’s case that during the marriage he would pay the wife approximately HK$25,000 per month, on average, to cover the household expenses, the son’s expenses and her own expenses. He says that on 8 occasions during this very short marriage of less than 24 months, this increased to HK$30,000 per month.

36.  The wife says that she currently has the following expenses:

Part 4 Currently Monthly Expenses

4.1 General

Item	Amount
Rent	HK$	0.00
Mortgage Instalments	HK$	0.00
Utilities (electricity, gas, rates, telephone & water)	HK$	1,500.00
Management fees	HK$	1,000.00
Food	HK$	4,000.00
Household expenses	HK$	4,000.00
Car expenses	HK$	0.00
Insurance premia	HK$	64.00
Domestic helper(s)	HK$	0.00
Other (specify)	HK$	0.00
Total monthly household expenses	HK$	10,564.00

4.2 Personal

Item	Amount
Meals out of Home	HK$	2,000.00
Transport	HK$	2,000.00
Clothing / Shoes	HK$	4,000.00
Personal grooming (including haircut and cosmetics)	HK$	3,000.00
Entertainment / presents	HK$	1,000.00
Holiday	HK$	4,000.00
Medical / Dental	HK$	2,000.00
Tax	HK$	0.00
Insurance premia	HK$	2,636.31
Interim maintenance (including rent, utilities and maintenance for the child and the Respondent)	HK$	0.00
Contribution to parents	HK$	500.00
Dependent family members	HK$	1,000.00
Other (specify)	HK$	0.00
Total monthly personal expenses	HK$	22,136.31

4.3 Children

Item	Amount
School fees	HK$	12,500.00
Extra tuition fees	HK$	0.00
School books and stationery	HK$	0.00
Transport to school (including school bus)	HK$	0.00
Medical / Dental	HK$	500.00
Extra Curricular Activities	HK$	1,000.00
Entertainment / presents	HK$	1,000.00
Holidays	HK$	2,000.00
Clothing / Shoes	HK$	1,000.00
Insurance premia	HK$	795.15
Lunches and pocket money	HK$	1,000.00
Other Transport	HK$	1,000.00
Child-minding fees	HK$	0.00
Uniform	HK$	0.00
Other (specify)	HK$	0.00
Total monthly expenses for children	HK$	20,795.46

Total monthly expenses (4.1+4.2+4.3)

HK$

53,495.46

37.  Although many of these expenses seem reasonable, it is clear from the bank statements produced by the wife that in reality she has a fairly frugal lifestyle and that her biggest expenditure relates to her daughter and her daughter’s education. Most of the general expenses seem reasonable, save that the household expenses seem a little on the high side. I will reduce these to HK$2,000 per month. Thus I will allow HK$8,500 per month in total for her general expenses. The wife’s personal expenses however, all seem to be inflated and in my view are capable of significant reduction. I will allow HK$10,000 per month in total for the wife’s personal expenses.

38.  Thus I shall reduce the wife’s maintenance in two tranches. Initially I shall reduce the maintenance from HK$42,000 per month to HK$38,500 per month with effect from the 1 December 2019 to the 1 May 2020. Thereafter the maintenance shall be further reduced to HK$18,500 per month with effect from the 1 June 2020, until the wife’s remarriage or during the joint lives of the parties, whichever is shorter, or until further order. This is calculated on the wife receiving HK$18,500 per month for her own maintenance and HK$20,000 per month to cover NC’s expenses until she completes her A’levels. Thereafter, in common with a great many other young people, NC shall need to take some financial responsibility for her own educational choices, presumably after discussing the same with the wife and her other family members. As in the past the husband will not be part of that dialogue. This order is based in part on the fact that in reality the wife has to pay for NC’s expenses until at least the summer of 2020 and that it is not feasible or indeed fair to pull NC out of school at such short notice prior to that. Although the wife could rely in part on her savings to settle NC’s costs over her remaining six months at school, it is noted that the wife’s savings are quite limited, her current earning capacity very low and that she also needs somewhere to live. Just as selling the husband’s matrimonial home is really a last resort for him and his family, likewise selling the Lam Tin property would also be very much a last resort for the wife.  

39.  As indicated above, in broad terms it seems to me that the husband must have been aware that the wife was funding some, if not all of NC’s expenses herself and that it is clear that this must have come from the maintenance that he was paying her and any savings that she might have had left. I accept that the husband’s financial situation is tight, but it seems to me that he does have the financial resources available to pay a reasonable sum of maintenance in the short term. In the longer term, he may need to restructure his asset base. Any restructuring will need to include provision for his ongoing financial responsibilities towards the wife. He also has a greater earning capacity than her and if he does not pass the Chinese Medical Practitioner’s exams he may have no other alternative but to return to the work force in some other capacity.           

Should the husband’s undertaking to pay the wife a “Christmas gift” in the sum of HK$30,000 per annum be discharged?

40.  There was a certain amount of intrigue surrounding the undertaking which was a little difficult to follow. It seems that the wife originally used this money to pay for an insurance premium that ran for five years. It is not clear why the undertaking did not simply state this. In addition, she says that she has used the money to pay for holiday expenses, and that this was part of the original intention, although at the same time she also said that she needed HK$4,000 per month to cover her holiday costs. This didn’t really add up. In any event given that the premium is now paid up it seems that this additional sum is rather excessive given the circumstances. Consequently, I can see no justification for the undertaking continuing. It shall be discharged as requested by the husband. 

Costs

41.  This is a case that should have been settled. Nevertheless, it is also accepted that it seems, on the face of it, that the husband had no option but to issue the summons, given the wife’s rather uncompromising stance and the fact that she only conceded that NC was not a child of the family very late in the day. Further, it should also be noted that neither party has been wholly successful, although it would be fair to state that the husband has been more successful than the wife. Given that I shall exercise my discretion and I shall make an order nisi to be made absolute in 28 days’ time, that the wife do pay half of the husband’s costs of and arising out of his summons dated the 29 November 2017, such costs to be taxed if not agreed on a party and party basis. There shall be a certificate for counsel.

Final order

42.  I shall therefore make an order as follows:

a)      Paragraph 4 contained in the preamble of the court order dated the 8 July 2011 shall be discharged.

b)      Order (i) contained in the court order dated the 8 July 2011 shall be varied to the extent that the maintenance for the Respondent shall be varied from HK$42,000 per month to HK$38,500 per month for a six-month period with effect from the 1 December 2019 until the 1 May 2020 and thereafter shall be further reduced from HK$38,500 per month to HK$18,500 per month with effect from the 1 June 2020 until the Respondent’s remarriage or during the joint lives of the parties, whichever is the shorter or until further order. The monies shall continue to be paid on the first day of each month and shall be paid into the Respondent’s bank account no 287-4-228865 maintained at the Hang Seng Bank.

c)      There shall be an order nisi to be made absolute in 28 days’ time that the Respondent do pay half of the Petitioner’s costs of and arising out of his summons dated the 29 November 2017, such costs to be taxed if not agreed on a party and party basis. There shall be a certificate for counsel.