CL v. CLKH also known as CKHL

FCMC 6640/ 2015

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 6640 OF 2015

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J U D G M E N T
(Maintenance Pending Suit)

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The application

1.  This is the hearing of the petitioner wife (“W”)’s application for maintenance pending suit (“MPS”) by the Summons dated 25 November 2016 for W and the child of the family, a daughter, (“child”) in the sum of $350,078.69 and from December 2016 onwards in the sum of $40,000 per month.  Her application was amended by adding the prayer for an order that the respondent husband (“H”) shall also pay her the sum of $20,000 per month from May 2015 to November 2016.  

Background

2.  H is aged 37 and W is 43.  The parties were married in June 2013 in Canada.  The child was born in January 2015.  Unhappy difference has since arisen and W issued the petition for divorce in May 2015, amended in September 2015.  The Decree Nisi was pronounced on 18 November 2015.  W filed the present application on 25 November 2016.  On 28 November 2016, as a stop gap measure, it is ordered that H shall pay W the sum of $5,000 per month as MPS, the 1^st payment to be made in December 2015.  W said that during the period from the parties’ separation in April 2015 to the Order dated 28 November 2016, H had only paid $10,000 for the maintenance of W and the child.  The Children Disputes Resolution hearing was scheduled to take place on 11 April 2017.

The Law

3.  The law in this subject is well settled. The wife’s application for herself is governed by section 3 of the Matrimonial Proceedings and Property Ordinance (“MPPO”), Cap.192. Provision for the child is under section 5 of the MPPO. 

4.  The court has a wide discretion in the matter, subject to the result being reasonable. In TL V ML & Ors (Ancillary Relief: Claim Against Assets of Extended Family) [2006] 1 FLR 1263, Deputy High Court Judge Mostyn QC (as he then was) stated at 1289: -

“The sole criterion to be applied in determining the application is ‘reasonableness’ (s 22 of the Matrimonial Causes Act 1973), which, to my mind, is synonymous with ‘fairness’.”

5.  The court will consider all factors that may influence the outcome of the application so as to make such order as it regards reasonable in all circumstances of the case. In C v F [2006] HKFLR 41, HHJ Bruno Chan stated at 45: -

“Although the sole statutory guideline in considering maintenance pending suit is that the award shall be ‘reasonable’, the court will nevertheless bear in mind all the factors drawn to its attention relating to the marriage and the parties to it and perhaps the two most outstanding matters in every case, as in this one, are the standard of living of the parties, and the ability of the husband to pay.”

My view

6.  I shall deal with the present application in accordance with the principles of law mentioned in the above.

The wife and the child’s needs

7.  H accused W of being greedy.  To him, the breakdown of the parties’ relationship was caused by his failure to extract further financial assistance from his family to support what he called W’s insatiable appetite for gifts and extravagant living standard.  W denied his accusations.

8.  The court might take into consideration the parties’ standard of living during marriage in making a determination on their reasonable needs.  W said the parties had maintained a comfortable living standard during the marriage, that the parties lived in a rented apartment, about 1,100 sq. ft. with 3 rooms, in the urban area, the rent of which was $26,500 per month, that they employed one live-in domestic helper and one baby-sitter, and they travelled overseas every year. She said that the family expenses including household expenses, personal expenses and the expenses for the child were over $100,000 per month, that H paid the rent and took care of all of the general expenses and child expenses that were about $52,500 per month, and he additionally gave her $10,000 per month as pocket money.  

9.  In contrast, H said there were 3 sources of contributions to the family expenses, to wit, profits of the Japanese ramen shop (“Ramen Shop”), carried on and run by W, his parents’ and his financial contribution.  However, I take notice that: -

(a)   W disagreed with H’s assertion that the profits of the Ramen Shop were used to meet the family expenses.   

(b)   W accepted that H’s father made contribution to the parties living expenses.  H estimated that his father, who organized two very extravagant weddings for the parties in Hong Kong and in Canada at his own expenses, and was responsible for the payment of the monthly rent of the parties’ rented apartment, had incurred more than $1.5 million in his family.

(c)   H said that he spent his personal savings of $2 million on gifts of jewelleries and gold bars, etc. to W, and on family expenses such as the wedding, medical fees for IVF operation and childbirth in a private hospital, and on overseas travels.   W disagreed that H had personal savings of $2 million.

(d)   It is not disputed that, on top of the above items, H used to pay W $10,000 per month.    

10.  Despite the parties’ contentions about whether the profits of the Ramen Shop were a source of contribution to the family expenses, and notwithstanding that, while H was taking the position that the Ramen Shop was family asset, W said the trademark of the Ramen Shop was never held by her, and accordingly H would probably take issue on the beneficial ownership of the trademark, and he had argued that the Ramen Shop was sold at undervalue, for the purpose of the present application, I shall not make any findings as to the parties’ disputes in this respect, on the ground that, as Hon Rogers VP stated in K v K (CACV 80/2010, 31 August 2010):  

“it is a very difficult thing and something which courts have to be extremely wary about to disbelieve a person on his affidavit or affirmation.”

11.  Notwithstanding that the parties have lived a comfortable living standard during marriage, H argued that W’s amount claimed in the present application was exaggerated. 

12.  Granting that the Ramen Shop was sold, and the parties were divorced and accordingly H’s father is not prepared to continue his financial support, neither the Ramen Shop nor does H’s father remains a source of contribution to the family expenses.  In the present situation, when the parties have to live within their means, their living standard will drop as a result.  In the circumstance, it is necessary to reduce the family’s monthly expenses.  Accordingly, I shall assess W and the child’s reasonable needs.

13.  According to W’s Form E dated 4 September 2015, W’s total monthly expenses amounted to $155,473, including the monthly rent of $27,000.  In her Affirmation dated 25 November 2016, she revised down her totally monthly expenses to $69,400, in which said affirmation W has set out the breakdown of her current monthly expenses as follows:

General expenses
	Amount (HK$)
Food	10,000
Household expenses	5,000
Car expenses	10,900
Sub-total	25,900

W’s personal expenses
	Amount (HK$)
Meals out of home	5,000
Transport	1,000
Clothing/ shoes	2,000
Personal grooming	3,000
Entertainment/ presents	1,000
Holidays	5,000
Medical/ dental	2,000
Sub-total	19,000

Child’s expenses
	Amount
School fees	10,000
Medical/ dental	3,000
Milk powder, baby food and homemade food	4,400
Clothing / Shoes	1,500
Other transport (taxi)	1,0300
Others – milk bottles, pram, baby food machine, educations games, diaper, laundry, etc.	4,500
Sub-total	24,500

14.  The said sum of $69,400 per month is obviously exceeding the means of the parties.  W is unemployed and has no income, and H’s income, only about $20,000 per month, must now stretch to support two households. 

General expenses

Food expenses

15.  In view of the parties’ limited means, I regard the sum of $5,000 per month is reasonable.

Household expenses

16.  W currently lives rent free at her parents’ flat that, according to W, is sized 450 sq. ft.  I regard the sum of $4,000 per month is reasonable.

Car expenses

17.  W is driving a convertible, bought at about $700,000 in 2014.  The personalised number plate of the car costed $50,000.  I take notice that, to cope with his financial difficulty, H sold his 7-seater vehicle for $110,000 in June 2015.  For the present exercise, I take the view that W might consider selling the car.  After having carefully considered all circumstances, I disallow W’s car expenses.

Personal expenses

Meals out of home

18.  W’s claim for the sum of $5,000 per month is excessive.  W, a fulltime housewife, might consider eating out less often.  I regard the sum of $1,000 per month is reasonable.

Transportation, Clothing/shoes, Personal grooming, Entertainment /presents, Holiday

19.  W’s claim for totally $12,000 per month is well beyond the parties’ means.  I allow the sum of $2,000 per month for these items. 

Medical/ Dental

20.  Taking a broad-brush approach, I allow $500 per month.

Child expenses

School fees

21.  After having carefully considered the school notices and receipts adduced, I accept H’s argument that the child’s school fees are currently $5,800 per month, and will be increased to $7,000 per month in the coming school term.  I allow $7,000 per month.

Medical/ Dental

22.  The child is suffering from severe separation anxiety and is taking counselling about once a month.  I allow W’s claim for $3,000 per month.

Baby Food, Clothing/shoes/ Taxi/ Others

23.  W’s claim for totally $11,400 per month is excessive.  I have allowed $5,000 per month for food in the above.  For these items, I allow totally $3,000 per month.

24.  In summary, for the purpose of the present exercise, the reasonable monthly expenses of W and the child are $25,500 per month.

W’s ability to pay

25.  W is unemployed.  According to H, W is capable to work even in the present circumstance, her parents could assist in the care of the child, or she could employ a domestic helper.  In view of the medical evidence that the child is suffering from severe separation anxiety, I accept that, in the short term, W’s fulltime care of the child is required.

26.  Notwithstanding that W is unemployed, H argued that she has the resources to support the needs of the child and her, having taken into account that W has, or has had, jewelleries that are valued by H at over $1 million, the sum of $2.5 million that W received from the sale of the Ramen Shop, and the further sum of about $2.7 million that she received from the sale of a landed property that was jointly owned by W and her ex-boyfriend.  In reply, W said she had sold the gold bars for $102,500 and the gold jewelleries for $49,877 to meet living expenses, and she had difficulties in selling the other items, that she had used the said sum of $2.5 million to meet living expenses, and that she planned to use the said sum of $2.7 million to repay her mother for the loans to her for meeting the living expenses of her and the child. 

27.  Surprisingly, it is W’s suggestion that she has used up to $2.5 million and has been required to borrow from her mother as much as $2.7 million to cover the living expenses of the child and her.  I take notice that, according to W, H paid W only $10,000 for the maintenance of W and the child during the period from April 2015 to November 2016, and H has been paying only $5,000 per month as MPS since December 2016, pursuant to the Order dated 28 November 2016.  Measuring up the amount of H’s payment against the amount of monthly expenses that W claimed, I can see that H’s payment has fallen short of the expenses having possibly incurred by W for the child and her, but by no stretch of the imagination do I believe that W has used up to $2.5 million + $2.7 million = $5.2 million in the living expenses of the child and her.  In order to consider the possibility, taking for the sake of argument that she needs between $69,400 to $150,000 per month, as shown in her Form E and Affirmation, she may have used no more than $3 million for the period from April 2015 to February 2017.  It is also worthy of noting that, according to W’s Form H filed on 16 January 2017, W’s legal costs up to the hearing dated 18 January 2017 were $215,500.  At any rate, even assuming that she has used up $2.2 million and was owing to her mother in the sum of $2.7 million, there is no need for her to immediately repay the self-professed loan of her mother.  She may use the said $2.7 million to support the child and her.  After having carefully considered, I accept H’s argument that W should have resources to provide maintenance pending suit for the child and her.

H’s ability to pay

28.  H studied in Canada and worked in there for a while after graduation before he returned to Hong Kong in 2010.  H’s grandfather is one of the owners of a company selling kitchen knives and kitchenware in Hong Kong.  Since he returned to Hong Kong, H’s income level has been ranging from $15,000 to $25,000 per month.  His current income is $20,000 per month.  He is also receiving the rent of a carpark at $1,000 per month.

29.  H’s financial position is set out in his Form E, Answers to questionnaire and Affirmations. H is living with his father in a flat registered under the names of H, his father and W.  According to his Form E dated 1 September 2015, his total monthly expenses amounted to $25,683.9, with no child expenses included.  H has no substantial assets, apart from being a joint owner of the flat that he is presently living in.  In his Affirmation dated 21 January 2017, he revised down his total monthly expenses to $18,600, including monthly repayment to his grandfather in the sum of $5,000 and the monthly MPS in the sum of $5,000.  I accept that his current monthly expenses of less than $9,000 are reasonable, but it appears to me that there is no urgency that H is required to continue the repayment of the loan of his grandfather.  For the purpose of the present exercise, I take the view that he has the ability to pay $10,000 per month as MPS, presuming that he will stop the repayment of $5,000 per month to his grandfather.  W should use her resources to make up the shortfall required to meet the reasonable needs of the child and her.

30.  I am aware that the issue on the parties’ respective financial resources and needs have remained a continuing source of disputes, but I should leave the issues to be sorted out at the substantive hearing.  It is trite that the court takes a broad-brush approach in determining MPS applications.  Further affirmations will be filed and witnesses will go to the box and be cross examined, when a detailed examination of the party’s financial resources and needs will be taken, at the substantive hearing.  With the benefit of further evidence and a detailed examination, the court will make its conclusion in the matter and any under provision or over provision in the MPS order may be set off if it is fair and just so to do.

Disposal

31.  In the meantime, I consider an order that H shall pay W the sum of $10,000 per month as MPS for her and the child will do broad justice to the situation, the 1^st payment back dated to take place on 8 December 2016, and thereafter on the 8 day of each succeeding month, until further order of the court.  H has been paying $5,000 per month from 8 December 2016, which means he has paid $5,000 less than the said sum of $10,000 per month for the period from December 2016 to February 2017, i.e. @ $5,000 per month X 15 months = $75,000.  Taking into consideration his financial situation as a whole, I allow him to pay the shortfall of $75,000 by 15 equal monthly instalments, i.e. $5,000 each instalment, the 1^st payment to be made from 8 March 2017, and thereafter on the 8 day of each succeeding month, until full payment.

Costs

32.  In view of the parties’ continuing disputes on their respective resources and needs, it is ordered that the costs of this application be reserved.  This is a costs order nisi, which becomes absolute 14 days after this order is made unless a party has applied to the court for varying the order.