IN THE DISTRICT COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
MATRIMONIAL CAUSES NO. 9565 of 2002
Coram: Deputy Judge C.K. Chan in Chambers (Not open to the public)
Dates of Hearing: 20-22 June, 15-19 August 2005
Date of Handing Down Judgment: 24 September 2005
J U D G M E N T
1. This is a trial on the petitioner wife’s application for ancillary relief against the respondent husband. For convenience, I shall refer to the petitioner as the wife and the respondent as the husband in this judgment.
2. The parties married on 19 March 1994. It was not in dispute that the husband has committed adultery during marriage. On 23 July 2002, the wife issued a petition for divorce. The ground for divorce had been amended for a number of times and eventually, the divorce suit went undefended and a decree nisi was granted on 4 November 2004 on the ground of adultery.
3. In the Notice of Intention to Proceed with Application for Ancillary Relief dated 19 November 2004, the wife asked for the following ancillary relief:
(1) a maintenance order (I suppose she meant a periodical payment order);
(2) a lump sum order;
(3) a property transfer order in respect of the husband’s property in Tai Lam, N.T. (“the Tai Lam Property”);
(4) any other order the Court shall deem fit; and
4. At the beginning of this trial, it has become apparent that both parties agree to a clean break and that the wife is now only pursuing the relief of a lump sum order.The Law
5. The governing statutory provision for ancillary relief application can be found in section 7 of the Matrimonial Proceedings and Property Ordinance, Cap.192, which is as follows:
“7. Matters to which court is to have regard in deciding what orders to make under sections 4, 5 and 6
(1) It shall be the duty of the court in deciding whether to exercise its powers under section 4, 6 or 6A in relation to a party to the marriage and, if so, in what manner, to have regard to the conduct of the parties and all the circumstances of the case including the following matters, that is to say-
(a) the income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future;
(b) the financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future;
(c) the standard of living enjoyed by the family before the breakdown of the marriage;
(d) the age of each party to the marriage and the duration of the marriage;
(e) any physical or mental disability of either of the parties to the marriage;
(f) the contributions made by each of the parties to the welfare of the family, including any contribution made by looking after the home or caring for the family;
(g) in the case of proceedings for divorce or nullity of marriage, the value to either of the parties to the marriage of any benefit (for example, a pension) which, by reason of the dissolution or annulment of the marriage, that party will lose the chance of acquiring.
6. The wife’s petition for divorce was based on the husband’s adultery, which was admitted by the husband. The husband’s infidelity may be regarded as morally reprehensible in the eyes of a layman, it is well settled law that for a conduct to be taken into account in deciding on the question of ancillary relief, that conduct has to be “obvious and gross”: Wachtel v. Wachtel  1 All ER. The single fact that the husband has committed adultery, without anything more, can not be regarded as such obvious and gross conduct that has to be taken into consideration in deciding on the present proceedings.
Income, Earning Capacity, Property and Other Financial Resources
Wife’s Present Income and Future Earning Capacity
7. The wife used to work for an international bank in Canada and then in Hong Kong for over a decade. Before she was made redundant in November 2001, her title with the bank was Manager-Relationship, mainly serving some big corporate clients. Her then income was in the region of HK$40,000 to $45,000 per month.
8. As from November 2001, the wife has been unemployed and was only able to get a part time administrative job with a college in October 2003 earning a monthly income of HK$4,000.
9. It is the wife’s evidence that she is now studying for two Master Degrees at a college, one for the Degree of Divinity and the other for the Degree of Christian Ministry. She expects to complete the two degrees sometime in 2007 the latest.
10. The wife testified that after she has completed the studies, she would look for a job in the church which she hopes would give her an income of about HK$10,000 to $20,000 a month. She doubted her ability to return to the banking industry or even if she could, she would not be able to secure anything close to what she used to earn.
11. It is the husband’s contention that the wife is in a position to earn more.
12. I understand that the wife is now aged 36 and was educated up to university level. She has been working in the banking industry for over a decade and must have accumulated vast experience and established extensive connection in this field. I think she is over-pessimistic in thinking she is unable to return to the banking industry, especially in view of the recent rebound of the Hong Kong economy.
13. I accept that initially, she may not be able to command a comparable income as in her previous job due to the fact that she has not been working full time in the past few years. But I am prepared to accept the husband’s contention that she does have an earning capacity. Although there is no evidence on the likely income that the wife would command if she has decided to go back to the banking industry, I think it would not be too unreasonable to assume a figure of $25,000 which would be about 60% of her previous monthly income.
14. The wife also testified that it was her wish to develop her career in Christian ministry. She expects her monthly salary in that field to be in the region of $10,000 to $20,000 even if she is going to work full time. Be that as it may, for the purpose of assessing the wife’s earning capacity, I am bound to assess the highest possible income she may reasonably be expected to command in the labour market, which is $25,000 per month in the present case.
15. The wife is the holder of a number of bank accounts. Mr. Li, acting for the wife, valued the total balance in all the accounts at $57,886.58 whilst Ms. Lan, counsel for the husband, put up a figure of $104,454.93. I tend to accept the calculation of Mr. Li because the figures that he was quoting were more up to date.
16. The wife is also a holder of a number of insurance policies, most of them are of investment in nature. During cross examination, the wife had difficulties in explaining the nature and the latest positions in those policies. Some of her evidence on the cash value was based on oral telephone enquiries with no documents in support. I find this highly unsatisfactory.
17. For the purpose of calculating the cash value in all those policies, counsel for the husband put forward a figure of USD 92,158.39 (HK$ 716,992.27). I am satisfied that two of the policies quoted by the husband (B311XXXXXX and B314XXXXXX) are no longer in existence and so the two respective sums of USD 254.9 and USD 528.47 should not be counted. Therefore, I am prepared to accept a figure of USD 91,375.02 (HK$712,725.15) as the wife’s current interest in all her policies.
18. The wife is also the owner of 2 landed properties.
19. The first property is a flat in Canada. Although there is no formal valuation on the current market value of this property, I am prepared to accept the value put forward by the husband which is CAD 174,000 (HK$ 1,124,040). I think the wife should have no complaint on this because the value as appeared in the schedule prepared by the wife‘s solicitor was even a bit higher than that. This is a net value because the mortgage of this property should have already been repaid in full.
20. The second property is in the Mainland the market value of which was agreed by the parties at RMB 570,000. It is common ground that this property is subject to an existing mortgage in the sum of RMB 525,000, leaving its net value at RMB 45,000, which is equivalent to HK$42,857.
21. The net total value of the 2 properties is HK$ 1,166,897.
22. The wife is also holding certain shares in the MTR with a current value at HK$17,056 (adopting an unit price of $16.00 on 17.8.2005).
23. According to the wife, she also holds a Registered Retirement Savings Plan in Canada with a current value at CAD 7,727.40 (HK$49,293).
Summary of the Wife’s Assets
24. By way of summary, I am satisfied that the wife has the following assets:
|Retirement Savings Plan
25. The husband is now working as the principal of an international school. He has in fact three sources of income:
(1) As the principal of an international school
(2) As the manager of a nursery
(3) As a director of a company called B. Co. Ltd.
26. The total monthly income of the husband amounts to $118,120. I do not think there is any controversy in this part of the husband’s evidence as everything was well documented.
27. As regarding the husband’s assets, they are comprised of...