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Bt And Cby (Formerly Known As Yhk And Also Known As Ycb

Judgment Cited authorities 2 Cited in Precedent Map Related
Vincent
Judgment Date12 November 2020
Neutral Citation[2020] HKCFA 35
Judgement NumberFAMV121/2020
Citation(2020) 23 HKCFAR 447
Year2020
Subject MatterMiscellaneous Proceedings (Civil)
CourtCourt of Final Appeal (Hong Kong)
FAMV121/2020 BT and CBY (formerly known as YHK and also known as YCB)

FAMV No. 121 of 2020

[2020] HKCFA 35

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 121 OF 2020 (CIVIL)

(ON APPLICATION FOR LEAVE TO APPEAL FROM

CACV NO. 439 OF 2019)

_______________________

BETWEEN
BT Petitioner/
Judgment Debtor
(Applicant)
and
CBY
(formerly known as YHK and
also known as YCB)		 Respondent/
Judgment Creditor
(Respondent)

_______________________

Appeal Committee: Mr Justice Ribeiro PJ, Mr Justice Fok PJ and Mr Justice Cheung PJ

Date of Hearing and Determination: 10 November 2020

Date of Reasons for Determination: 12 November 2020

__________________________________

REASONS FOR DETERMINATION

__________________________________

Mr Justice Ribeiro PJ:

1. At the hearing, we dismissed this application for leave to appeal for reasons which we now provide.

A. The proceedings below

2. In divorce proceedings commenced by the present applicant (“the husband”), the Court made an order by consent whereby he undertook to pay a lump sum of $26 million to the present respondent (“the wife”) in seven instalments within 36 months, ie, by 1 September 2014 (“the Consent Order”). Although the first instalment was due on 1 September 2011, the husband failed to make any payment until 1 March 2013, and then again defaulted.

3. To enforce the Consent Order, the wife issued judgment summonses requiring the husband to show cause why he should not be committed to prison for such default. The matter came before HH Judge Melloy and in the first part of the trial (in February 2014), the husband agreed to sell two properties and to pay the proceeds into court or to the wife. He also agreed to make interim payments of $300,000 per month to the wife. At the resumed hearing, it was not in dispute that $24,170,410.67 was due and owing as at 5 May 2015 and, noting that the husband “was given the benefit of the doubt” in February, the Judge found that, “the husband certainly originally had the means to pay the wife” but that, as a deliberate act, he “did wilfully choose not to make the payments due and owing to the wife and he did choose to invest the monies elsewhere”. She also found it a matter of concern that the properties had not been sold and was inclined to accept that this had been deliberately contrived.[1]

4. The Judge thus found that the husband was in contempt “as he had the ability to make the payments ordered but has wilfully failed to do so”.[2] However, instead of immediately committing him to prison, the Judge decided to allow him a year to sell the properties and raise the funds to satisfy the judgment. Accordingly, on 29 May 2015 she made a committal order which she suspended on condition that, on or before 1 June 2016, the husband paid to the wife the $24,170,410.67 outstanding, with interest accruing at a daily rate of $5,297.62 and a surcharge of $1,208,520.00, meanwhile continuing to make the monthly $300,000.00 payments (“the 2015 Order”).

5. The husband again defaulted. He paid neither the outstanding lump sum amount nor the surcharge and defaulted in making most of the monthly payments. The wife applied on 11 October 2016 to activate the suspended sentence of committal imposed as part of the 2015 Order. However, on 30 December 2016, the Court of Appeal published its judgment in YBL v LWC,[3] holding that changes had to be made to the judgment summons procedure under Rule 87 of the Matrimonial Causes Rules[4] to achieve consistency with Article 10 and Article 11 of the Bill of Rights.[5] We should emphasise that the present application does not involve any challenge to or consideration of the correctness or otherwise of YBL v LWC. This is unsurprising since it was relied on by the husband in resisting activation of the suspended committal order.

6. That decision was however important to the progress of the case since the changes made by YBL v LWC led Judge Melloy to refuse the wife’s application to activate the suspended committal order.[6] The wife therefore had to issue a fresh application for committal.[7] In her ruling dated 28 June 2019,[8] Judge Melloy held that the husband had breached the 2015 Order, having deliberately chosen to put other financial commitments ahead of his obligations under that Order. However, she refused to make a committal order on the basis that the wife was unable “to show beyond reasonable doubt that the husband has the current ability to pay her what he owes”.[9]

7. On the wife’s appeal, the Court of Appeal[10] reversed the Judge’s decision and, being satisfied that the husband had been guilty of contempt of court by not complying with the 2015 Order, committed him to prison for three months. Cheung JA, writing for the Court, held that the Judge had wrongly focussed on the state of the husband’s means asserted at the time of the hearing in 2019 rather than on his conduct and means in the period from the making of the 2015 Order until 1 June 2016, the extended time for compliance. In that period, there was ample evidence that the husband “had the means to pay the wife but ... refused to do so because he chose not to use the available funds to satisfy the debt he owes her”.[11] His purported inability to pay “was self-generated because he put his priority in repaying his family member and his creditors ahead of his wife”.[12] Furthermore, his Lordship held that the Judge had been wrong to permit the husband to rely on his latest affirmation to assert that he lacked the necessary means when he had declared that he would not submit to being cross-examined on it,[13] Her Honour proceeding on that basis to find that the wife did not have sufficient evidence to prove beyond reasonable doubt that he had available means.

8. The Court of Appeal highlighted the nature of the husband’s contempt as follows:

“The history of the case reveals a clear pattern by the husband to flaunt Court orders for payment made either with his consent or upon his undertaking to comply with an earlier order. He had been found in contempt once and was given a chance to purge his contempt when the Judge suspended the operation of committal order by giving him further time to pay the wife. To date he still has not complied with the order for payment.”[14]

9. On 26 June 2020, the Court of Appeal refused the husband’s application for leave to appeal to this Court.

B. The present leave application

10. Two features of the proceedings below should be noted. First, procedural complications were introduced because the wife’s efforts to enforce the orders in her favour straddled the YBL v LWC decision. The ensuing change in practice interrupted such enforcement, rendering ineffective the suspended committal order. The present case therefore involves a transitional situation which is most unlikely to recur and raises no point of general practical importance.

11. Secondly, the Court of Appeal’s decision turned on determining the appropriate time for assessing the conduct and means of the...

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