FMY v. LCW

FCMC 8660 / 2013

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 8660 OF 2013

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J U D G M E N T
(Maintenance pending suit/Interim maintenance)

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Introduction

1. This is an application by a Petitioner wife for maintenance pending suit for herself pursuant to s.3 Matrimonial Proceedings and Property Ordinance Cap 192 (MPPO) and interim maintenance for the only child of the family, a little boy who was born in August 2012 pursuant to s.5 of the same ordinance. The wife seeks HK$35,000 per month plus a further HK$1,500 for utility expenses.

The main issues

2. In broad terms there is only one issue to be determined namely how much maintenance should the husband pay to the wife for herself and the child of the family on an interim basis.

Background 

3. By all accounts this has been a turbulent and fairly short lived relationship that has produced one child. The parties married in August 2010 and their son was born two years later. Each party makes serious allegations against the other. On the 20 June 2013 the wife filed a divorce petition based on the husband’s unreasonable behaviour. On the 18^th February 2014 the husband filed an Answer and Cross petition based on the wife’s unreasonable behaviour. The wife’s Reply followed. Trial dates have now been set for February 2015.  In the mean time there have been ongoing difficulties with respect to the arrangements for the parties’ only son. A further Children’s Dispute Resolution hearing has been set down for December 2014. It is against this back ground that the wife seeks maintenance pending suit.

The law

Maintenance pending suit and interim maintenance

4. The law is well known and not in dispute. Section 3 Matrimonial Proceedings and Property Ordinance Cap 192 states that the only governing principle is that the court shall make such order as it considers reasonable in all of the circumstances of the case. Consequently applications such as these are approached on a broad-brush basis. A detailed examination of the parties’ means may be examined at a later date at a full ancillary relief hearing if there is no agreement in the meantime, when there is then every opportunity to achieve fairness by means of set off. In other words, if there is any overpayment or underpayment that can normally be rectified at a final ancillary relief hearing. Applications for interim maintenance under section 5 of the same ordinance are approached in exactly the same way. As Rayden points out

…what really matters is the immediate and reasonable requirements of the wife balanced against the ability of the husband to pay for them, assessed using a broad-brush approach. (See paragraph 16.17 of Rayden, 18^th edition).

5. Further

In practice, as oral evidence is rarely given, it will be unusual for the court on an application for maintenance pending suit to be in a position to make findings of fact on issues in dispute sufficient, for example, to deal with conduct or allegations of non disclosure.  However, if it is demonstrated that the paying party has not performed his duty to make full and frank disclosure of his financial resources, then the court can take a broad and robust view of his means, and it does not have to accept and proceed on the basis of the assertions of the paying party as to his means and an inability to pay.  The court can look at the reality of the situation …… Any under provision or over provision in the order for maintenance pending suit can always be corrected when the account comes to be taken at the substantive hearing when there are every opportunity to do fairness by set off ……”

(Ref paragraphs 16.18 of Rayden, 18^th edition). The court should look to the reality of the situation, in so far as it can, in relation to bare assertions made by either party.

The present financial arrangements  

6. At present the wife is living with the son in a property owned by the husband’s family. Thus the husband provides for the accommodation and he is also responsible for payment of the utilities. He says that he is responsible therefore for the rental, electricity, water rates and the management fee plus he claims that he has also previously paid for some additional items such as furniture and also for some renovation costs. Putting the last two items to one side for the moment, the husband has said that he will continue to be responsible for providing the wife with this accommodation and to pay for the ongoing electricity, water rates and management fees. I will hold him to his agreement in this respect.

7. It is the wife’s case that she has been a housewife since marriage and that she has not been able to work given the age of the young son. She seeks HK$36,500 per month in addition to the provision of housing etc as set out above. She says that prior to marriage she was a saleslady. It is the husband’s case that the wife worked selling second hand cars and that she continued to work in that capacity after marriage and since separation. He says that she can earn up to HK$10,000 per month.

8. In his Form E the husband describes himself as a Director. On the face of it seems that he is engaged in a family business. He lists 17 limited companies in his Form E in which he held directorships over the last 24 months. He holds shareholdings in four of these. It is the wife’s case that the husband is from a reasonably wealthy family and that he receives bonuses and other financial benefits from his involvement in these companies. This is disputed by the husband.

9. The husband says that his salary is now HK$28,500 per month. Previously he said that he earned HK$27,000 per month. In addition one can see regular deposits being made into his HSBC bank account for HK$7,500 per month, which he says is a rental payment for a property known as K Garden and a further HK$16,000 per month. According to the husband he also receives a rental from another property known as H in the sum of HK$21,500 per month. I am prepared to accept, for the purposes of this hearing that these sums i.e. the HK$16,000 per month and the HK$21,500 per month relate to the same property. In total then the husband presently receives a basic monthly income of approximately HK$57,500 per month. According to the husband’s Form E dated the 23 August 2013 he also received discretionary Director’s emoluments of approximately HK$41,750 per month. The husband now says that this is no longer the case – although no evidence has been filed to support what he says in this respect. It is simply a bare assertion on his part.

10. The wife for her part says that this is a ruse and that the husband will be entitled to similar payments going forward. Her solicitor refers to the audited accounts of companies in which the husband is both a shareholder and director and the bonuses that have been historically received by the directors. For example the husband is a director and shareholder for X (HK) Limited. Audited financial statements have been produced for the year ended 30 April 2013. The husband is one of three directors. The company appears to be running at a loss. Nevertheless in the year 2012 the director’s bonus was HK$803,000. In 2013 it was HK$560,000. If one presupposes that the bonus are shared equally this means that the husband’s share would have been just under HK$268,000 in 2012 or just over HK$22,000 per month and just over HK$185,000 in 2013 or approximately HK$15,400 per month. Similarly for Y Limited. This company has 4 directors of which the husband is one. In 2012 they received a director’s bonus of HK$1,300,000 or HK$325,000 each (c HK$27,000 per month) and in 2013 this went down slightly to HK$1,200,000 or HK$400,000 each (HK$33,335 per month). Thus although more details are needed it seems to me that on the balance of probabilities the husband is probably going to be entitled to sizeable director’s emoluments going forward. 

Each party’s respective proposals

11. In his affidavit the husband offered to pay the wife maintenance of HK$3,000 – HK$4,000 per month. In court he refined his offer to HK$3,500 per month. In addition he said that he was prepared to pay for those items set out above. In addition he says that he is responsible for most of the child’s expenses as follows:-

11.   I now enclose copies of the Child’s various expenses paid by me and as you can see, I paid for the Child’s playgroup, school books and stationery for the new academic year, trial class, insurance, medical fees, food and his daily hygiene stuff…  

He asks that the wife’s application be dismissed. 

12. In her solicitor’s letter dated the 3 October 2013 the wife originally asked the husband for HK$20,000 per month. However in court she stuck to the amount stated in her summons – i.e. HK$36,500 per month for herself and the child. 

What are the wife’s reasonable needs?

13. The wife produced the following schedule setting out her reasonable needs as follows:-

11.   My monthly expenditure is on average as follows:-
Item	Amount (HKD)
Salary of Domestic Helper	4,000.00
Food (for the whole family)	8,000.00
Clothing for myself	1,500.00
Medical expenses for myself	1,500.00
Travelling expenses for myself	3,000.00
Insurance	1,000.00
Entertainment	2,500.00
Miscellaneous expenses (supermarket, shopping for the Child and others)	2,000.00
Total:	23,500.00
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The monthly expenditure of the Child is on average as follows:-
Item	Amount (HKD)
Insurance	3,000.00
Books and stationary	500.00
Medical expenses	3,500.00
Entertainment	3,000.00
Total:	10,000.00
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This amounts to HK$33,500 in total. It is unclear on what basis she says that she needs HK$36,500 per month.

14. The husband says, and with some justification it seems to me, that many of these expenses are excessive. For example the wife says that she has employed a domestic helper, although on her case she is not working and has limited financial resources. She has not produced a copy of the helper’s employment contract or any evidence of salary payment. Pending further evidence being produced I am not willing to accept for present purposes that the wife has employed a new domestic helper. Thus this expense will not be allowed. Likewise I accept that the amount claimed for food is very high. I will allow HK$4,000. I also accept that the amount claimed for entertainment is also very high – HK$5,500 in total. I will allow HK$1,000 each for the wife and child. I also accept the husband’s evidence that although the child has had some problems with his eyes that there is no need to allow HK$3,500 for the child’s medical expenses. There is no evidence that such a large sum is necessary. I will allow HK$500 per month for the wife and HK$500 per month for the child. I also accept that the insurance figure of HK$3,000 per month for the child, is in the context of this case, also very much on the high side. I will not allow this. All in all then I will allow the following expenses for the wife and the child on an interim basis:-

11.   My monthly expenditure is on average as follows:-
Item	Amount (HKD)
Salary of Domestic Helper	NIL
Food (for the whole family)	4,000.00
Clothing for myself	1,000.00
Medical expenses for myself	500.00
Travelling expenses for myself	1,500.00
Insurance	NIL
Entertainment	1,000.00
Miscellaneous expenses (supermarket, shopping for the Child and others)	NIL
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Total:	8,000.00
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The monthly expenditure of the Child is on average as follows:-
Item	Amount (HKD)
Insurance	NIL
Books and stationary	500.00
Medical expenses	500.00
Entertainment	1,000.00
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Total:	2,000.00
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This amounts to HK$10,000 per month.

Can the husband meet the wife’s reasonable needs?

15. Although the husband complains that he cannot pay more than HK$3,500 per month, it seems to me that he does have the financial resources available to him to pay HK$10,000 per month in addition to the other items specified. An order in these terms will accordingly be made.

Other points

16. I should also add that I did not find either party entirely credible. In putting their case at its highest both parties made assertions that were quite frankly unbelievable. For example the husband’s claim that he had given his father HK$381,578.99 in settlement of a loan for repayment of utility expenses for a 24 month period. If one were to accept this, which I don’t, that would mean that the husband had been paying nearly HK$16,000 per month in utility expenses. Such an assertion was quite frankly incredible and cast the husband is a very bad light. I am inclined to accept in the circumstances that the husband was simply trying to ensure that funds were not easily available for the wife. Likewise the husband’s assertion with respect to director’s emoluments did not ring true.

17. Similarly much of the wife’s evidence simply failed to come up to proof. The parties should perhaps reflect on this before returning to court in December this year and February next year.

Costs 

18. In so far as costs are concerned, it is of course possible for me to take into account the litigation conduct of the parties – but given that this is a maintenance pending suit hearing and I have not heard from the parties in the witness box, I will not sanction either party with respect to costs at this juncture.

19. It is fair to say that neither party has been wholly successful – but notwithstanding that it was nevertheless incumbent upon the wife to make an application and to come to court. She really had no alternative but to do so, given the husband’s stance. Consequently I will make an order that the husband do pay the wife’s costs of the maintenance pending suit application to include all costs reserved, such costs to be taxed on a party and party basis if not agreed.

Order

20. Consequently I shall make an order as follows:-

 UPON the Respondent undertaking to continue to provide the present accommodation for the Petitioner and the child of the family and to continue to undertake to pay for the electricity, water rates and management fees for the said property pending further order;

AND UPON the Respondent undertaking to continue to pay for the child of the family’s kindergarten fees, school books and stationery and for his own insurance, medical fees and for food when the said child is in his care pending further order

IT IS ORDERED THAT 

1)   The Respondent shall pay maintenance pending suit to the wife for herself in the sum of HK$5,000 per month and interim maintenance to the Petitioner for the child of the family also in the sum of HK$5,000 per month the first payment to be made on the 1 October 2014 and thereafter to be paid on the 1^st day of each succeeding month until further order.

2)   The First Appointment hearing shall be adjourned to the same date as the adjourned CDR hearing.

3)   Both parties do personally attend that hearing.

4)   The Respondent do pay the wife’s costs of and occasioned by the summons dated the 1 August 2014, such costs to be taxed on a party and party basis if not agreed.