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Kcma v Abc And Others

Judgment Cited authorities 6 Cited in Precedent Map Related
Vincent
Judgment Date21 May 2020
Neutral Citation[2020] HKCFI 848
Judgement NumberHCMC1/2019
Subject MatterMatrimonial Causes
CourtCourt of First Instance (Hong Kong)
HCMC1B/2019 KCMA v. ABC AND OTHERS

HCMC 1/2019

[2020] HKCFI 848

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MATRIMONIAL CAUSES NO. 1 OF 2019

________________________

BETWEEN
KCMA Petitioner
and
ABC 1st Respondent
PBB in his capacity as the Trustee of the Family Trust 2nd Respondent
PBB in his capacity as the Trustee of the Education Trust 3rd Respondent
K 4th Respondent

_______________________

Before: Hon B Chu J in Chambers (Not Open to the Public) (By Paper Disposal)
Date of Petitioner’s Submissions: 23 March 2020
Date of 1st Respondent’s Submissions: 30 March 2020
Date of Petitioner’s Reply Submissions: 6 April 2020
Date of Petitioner’s Further Submissions: 4 May 2020
Date of 1st Respondent’s Further Submissions: 4 May 2020
Date of Decision: 21 May 2020

____________________

D E C I S I O N
(Litigation Funding)

_____________________

1. This Court has previously handed down two decisions in these matrimonial proceedings, the first decision on 21 November 2019 in relation to W’s application for joinder of the Trustee of the US Trusts and for joinder of H’s father (“Joinder Decision”), followed by a 2nd decision on 22 November 2019 on W’s Injunction Application against H (“Injunction Decision”). As seen in those decisions, there was also the Discovery Application issued by W which was adjourned sine die with liberty to restore. I shall continue to use the abbreviations in those decisions, save where otherwise indicated herein.

2. The present application before the Court is made by W for provision for costs or litigation funding by way of a summons issued on 12 August 2019 (the 2nd Summons as defined later). Before I consider W’s present application, I will first set out the relevant financial applications which have been made so far by the respective parties in the present proceedings.

The relevant financial applications

3. In so far as this Court can gather, there have been the following financial applications issued:

(1) W’s application for final ancillary relief made in her divorce petition issued on 21 November 2016, and later in her Form A filed under Practice Direction 15.11 on 22 March 2017 (“W’s AR Application”);

(2) In H’s Form 4, he has indicated that he wishes to be heard on W’s AR Application and that he wishes to make his own applications for ancillary relief, but so far as I can see, no Form A has been filed on his behalf.

(3) On 27 March 2017, W issued a summons for maintenance pending suit for herself and interim maintenance for the Children, to include a legal cost provision (“W’s 1st Summons”);

(4) On 29 August 2017, W issued a notice of application for avoidance of H’s disposition of assets to the US Trusts and to his father under section 17 of the Matrimonial proceedings and Property Ordinance, Cap 192 (MPPO) and for variation of nuptial settlement under section 6(1) (c) and (d) of MPPO, an invitation to various parties to intervene as respondents, and an injunction (in this judgment collectively referred to as “W’s 1st s 17 Application”);

(5) On 29 November 2018, W issued a summons for the Joinder Application, the Injunction Application and the Discovery Application;

(6) On 11 December 2018, Judge Melloy ordered that the ancillary relief applications by the parties and W’s 1st s 17 Application be transferred to the High Court (“Transfer Order”);

(7) After the Transfer Order, on 22 February 2019, W issued a further s 17 application to set aside H’s transfers from his bank accounts to his parents and other third party under section 17 of MPPO (“W’s 2nd s 17 Application”);

(8) On 12 August 2019, W issued the present summons for legal costs provision/litigation funding (“2nd Summons”);

(9) On 20 September 2019, H issued a summons for joinder of W’s parents and for appointment of single joint expert on French Inheritance Law (“H’s Joinder Application”);

(10) On 19 March 2020, H issued a summons for downward variation of maintenance pending suit/interim maintenance ordered by Judge Melloy on 11 December 2018 (“H’s Variation Application”).

4. On same day of the Transfer Order, namely 11 December 2018, Judge Melloy also made the following orders:

(1) H to pay W a total of HKD 105,800 per month, being maintenance pending suit for W in the sum of HKD 26,450 per month and interim maintenance in the sum of HKD 26,450 per month for each of the 3 Children, plus various undertakings (“MPS Order”);

(2) W’s application for litigation funding set out in her restored 1st Summons be dismissed upon W receiving a sum of HKD 975,000 on a without prejudice basis as set out in the order (“Melloy Order”);

(3) W’s summons issued on 29 November 2018 for the Joinder Application, the Injunction Application and the Discovery Application be transferred to the High Court.

5. At present,

(1) Pursuant to an order made by this Court on 24 June 2019, W’s AR Application and W’s 2nd 17 Application have been fixed for a 10 day trial, from 3-14 May 2021 (“AR Trial”);

(2) On 24 September 2019, this Court directed, amongst other things, that a further direction hearing of W’s AR Application, W’s 1st s 17 Application and W’s 2nd s 17 Application be fixed after the substantive hearing of W’s 2nd Summons and that the parties to attend mediation as soon as possible (“24.09.19 Order”);

(3) W’s Joinder Application and Injunction Application have been decided pursuant to the Joinder Decision and the Injunction Decision respectively on 21 and 22 November 2019;

(4) W’s 2nd Summons is being dealt with by paper in this decision;

(5) W’s Disclosure Application which was adjourned sine die has been fixed for a substantive argument on 17 June 2020 (2 hours reserved).

(6) H’s Joinder Application was fixed for a direction hearing on 28 October 2019 but as service had not yet been properly effected, the proposed joinder has been adjourned sine die with liberty to restore, and the application for a SJE on French inheritance law has been adjourned to a substantive hearing to be fixed (with 2 hours reserved);

(7) H’s Variation Application has been directed to be dealt with on paper.

6. W has further indicated that she intends to issue the following applications:

(1) An application for third party discovery re H’s entitlement from his employer/partnership;

(2) An application to enforce H’s undertaking in the MPS Order in relation to uninsured medical/dental expenses and housing needs and/or vary upward of the maintenance ordered in the MPS Order;

(3) An application to seek discovery concerning properties disposed of by H.

W’s applications for litigation funding

7. According to W’s evidence in her 8th affirmation filed in the FCMC proceedings[1] and a chronology submitted on behalf of W[2] (“Litigation Funding Chronology”), there have been the following requests and/or applications for litigation funds by W from H :

(i) On 2 February 2017, W’s solicitors first wrote to seek a monthly sum of HKD 50,000 for litigation funding;

(ii) As set out earlier, W’s 1st Summons was issued on 27 March 2017, for amongst other things, litigation funding and at a hearing on 19 April 2017, the parties agreed without any condition that H would, amongst other things, make payment of HKD 600,000 for W’s litigation funds and it appears that W’s 1st Summons was then adjourned sine die, and eventually this payment of HKD 600,000 was made on 28 April 2017 by H to W;

(iii) On 27 October 2017, W’s solicitors wrote to seek further litigation funding in the sum of HKD 600,000 to cover W’s costs from May to December 2017, which was resisted by H, as a result of which, W then sought leave to restore W’s 1st Summons, and at the hearing on 14 December 2017, H agreed to pay HKD600,000 with no condition attached and W’s 1st Summons appeared to be again adjourned sine die;

(iv) On 9 April 2018, W’s solicitors wrote to seek further litigation funds of HKD 600,000 to cover February to May 2018, which was refused by H, and she again restored W’s 1st Summons on 24 April 2018, and on 8 May 2018, the day before the call over hearing on 9 May 2018, H provided the funds, but W proceeded with the 1st Summons;

(v) Eventually, as set out earlier, pursuant to the Melloy Order on 11 December 2018, W’s 1st Summons was dismissed by Judge Melloy upon W each receiving a sum of HKD 975,000 of the distribution from the Family Trust and on the without prejudice basis as stated in the order;

(vi) On 6 June 2019, W sought further litigation funding and this led to various letters between the parties’ respective solicitors, as set out later in this decision;

(vii) On 12 August 2019, W issued her 2nd Summons.

8. The without prejudice basis upon which the Melloy Order was made (“WP Basis”) was as follows:

“D. AND UPON [W] receiving the sum of HK$975,000, being half share of the distribution requested to have already been made by [H] from the [Family Trust], for her litigation funding on the basis that is without prejudice to their rights and respective position concerning the [Family Trust] and/or all and any other matters arising from her [1st s17 Application ( as defined later)] and her [Injunction Application and Disclosure Application].”

9. In W’s 2nd Summons, she sought periodical payments to be applied towards her litigation funding up to the conclusion of the private FDR (financial dispute resolution) or mediation or before the Pre-Trial Review hearing which was at that time fixed on 24 September 2019. The total amount sought by W in the 2nd Summons was HKD 1,507,270 as follows :

(i) for the 1st month, a sum of HKD 233,350;

(ii) for subsequent months, HKD 106,160 each for 12 months.

10. W’s 2nd Summons was originally scheduled for a substantive...

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