MAN LAN YING v. LEUNG TSAN CHUNG

CACV 150/2006

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF APPEAL

CIVIL APPEAL NO. 150 OF 2006

(ON APPEAL FROM FCMC NO. 2187 OF 2001)

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J U D G M E N T

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Hon Tang VP (giving the judgment of the Court):

1.  In this appeal, the respondent (the husband) seeks to set aside the consent order of 4 May 2005, on the ground that the petitioner (the wife) has misled the respondent and the court about her financial means in two respects: (i) that she purchased Flat A, 18/F, Cheong Shing Mansion, No. 31 Wing Hing Street, Hong Kong (“the property”), together with her mother as joint tenants, on 18 March 2005; (ii) that she told the court at a hearing on 12 December 2003, that she repaid her mother a loan of HK$252,300, being a loan to purchase a property at Wah Fung Garden, out of HK$987,483, being severance payment and pension fund from her former company.  That, according to the respondent, was not correct and true because the loan was made and repaid by him alone.

2.  The law on the setting aside of consent order on the ground of non-disclosure is clear.  Each party owed a duty to make full and frank disclosure of all material facts to the other party and to the court, and that the principle of full and frank disclosure applied not only to the contested proceedings, but also to exchanges of information between parties and their solicitors leading to consent orders without further inquiry by the court.  See Jenkins v Livesey [1985] 1 AC 424.  These principles are of equal application in Hong Kong.

3.  However, in Jenkins, Lord Brandon of Oakbrook added:

“… an emphatic word of warning. It is not every failure of frank and full disclosure which would justify a court in setting aside an order of the kind concerned in this appeal. On the contrary, it will only be in cases when the absence of full and frank disclosure has led to the court making, either in contested proceedings or by consent, an order which is substantially different from the order which it would have made if such disclosure had taken place that a case for setting aside can possibly be made good. Parties who apply to set aside orders on the ground of failure to disclose some relatively minor matter or matters, the disclosure of which would not have made any substantial difference to the order which the court would have made or approved, are likely to find their applications being summarily dismissed, with costs against them, or, if they are legally aided, against the legal aid fund.”

4.  So here, what we have to consider is, whether in fact there has been any material non-disclosure on the part of the petitioner.  If so, whether such non-disclosure would have made any substantial difference to the order which the court would have made or approved.

5.  A sketch of the background may be helpful.

6.  The parties married in 1989.  In July 1993 they gave birth to the only child of their marriage, a daughter.  In March 2000, they separated.  On 8 March 2001, the petitioner petitioned for divorce.  On 3 July 2002, an order for divorce with custody of the child to the petitioner was made.  Then, followed protracted proceedings relating to maintenance which culminated in the consent order on 4 May 2005.  The respondent is a civil servant and his terms of employment make him eligible for educational allowance for his child.  The child has been receiving private education in the United Kingdom.  The respondent is due to retire in September 2008.

7.  Under the consent order, no provisions were made for the petitioner.  However, provisions were made for payment of a periodical payment of HK$15,500 per month from 1 June 2005 until the respondent’s retirement for the child.  Also he undertook to commute his pension upon his retirement into a lump sum of HK$700,000, which should be paid into a trust fund in favour of the child for her education.

8.  Two further sums of HK$203,847.67 and HK$80,000 were to be paid into an irrevocable beneficiary policy, with the Prudential Assurance Company Limited, for the benefit of the child of the family.

9.  Having regard to the age of the child of the family, it is obvious that the provision for her in the consent order would not be sufficient to enable her to complete her education.  As the petitioner said in her affirmation of 24 June 2006, since the respondent will retire in September 2008, he would only be responsible for another 27-monthly payments and having regard to the expense of education in the United Kingdom, the amount that he is paying can hardly be described as excessive.  Moreover, after the respondent’s retirement, the petitioner would be solely responsible for the education of the daughter until her graduation from the university.  The petitioner has assumed the responsibility to provide for her education.

10.  Having regard to the provisions made in the consent order for the child, the requirement of the child for her future education, and the amount involved, even if it is true that the plaintiff has a beneficiary interest in the property as a joint tenant, the non-disclosure of such beneficiary interest would not have made any substantial difference to the order which the court would have made or approved.

11.  I turn now to the question whether there has been actual lack of candour on the part of the petitioner.  The respondent’s complaint is two pronged.  First, he alleged that the respondent has beneficial interest in the property as a joint tenant.  Secondly, in any event, she was staying in her mother’s property rent free, whereas she had to pay rent on a rental flat previously.

12.  As for the joint tenancy, it is clear from the affirmation of the petitioner made on 24 June 2006, that she has no beneficiary interest in the property at all.  The property was brought by her mother, with a down payment of HK$513,180, on 29 March 2005, and a mortgage of HK$700,000.  Although since the affirmation of the petitioner of 24 June 2006, the respondent had filed a further affirmation, he had not sought to contradict that.

13.  As the petitioner had further explained in her affirmation of 24 June 2006, she paid the rental of HK$9,300 for a flat in Mei Foo from April 2001 to April 2005, but that the rental was increased to HK$12,000 in April 2005.  She then rented her mother’s flat in North Point at HK$10,000 per month.  So there is no change in the petitioner’s financial position so far as the rental is concerned.  The fact that she is paying the rental of HK$10,000 per month seemed to have been accepted by Mr Campbell, who appears for the respondent today.

14.  Turning to the second allegation, that has been denied by the petitioner, but more importantly, even if it was a lie, which I do not accept, it was a lie which was known to the respondent before he agreed to the consent order.  That must be a complete answer to the respondent’s complaint.

15.  So on the facts, I am not satisfied that there has been any material non-disclosure on the part of the petitioner.

16.  For the above reasons, I would dismiss the appeal with costs.

Hon Ma CJHC:

17.  I agree.

Hon Sakhrani J:

18.  I also agree.