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Lcf v Lcw

Judgment Cited authorities 8 Cited in Precedent Map Related
Vincent
Judgment Date01 June 2018
Neutral Citation[2018] HKFC 84
Year2018
Judgement NumberFCMC575/2017
Subject MatterMatrimonial Causes
CourtFamily Court (Hong Kong)
FCMC575/2017 LCF v. LCW

FCMC 575 /2017

[2018] HKFC 84

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 575 OF 2017

----------------------------

BETWEEN
LCF Petitioner
and
LCW Respondent

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Coram : Her Honour Judge Grace Chan in Chambers (not open to public)
Date of hearing : 3 May 2018
Date of judgment : 1 June 2018

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JUDGMENT
(Variation of a consent order for
maintenance pending suit/interim maintenance)

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The application

1. The petitioner of this case is the wife. The respondent is the husband.

2. On 28 August 2015, upon an application by the wife for maintenance pending suit for herself and interim maintenance for the 2 children of the family under the old suit (FCMC 1380 of 2015), the parties entered into a consent summons, which was made into a consent order of even date, in the following terms (collectively “MPS Order”):

(1) The husband do pay for the wife for a sum of $9,500 per month, comprising of $5,000 as her maintenance pending suit and $4,500 to cover the wages of the maid, starting from 1st September 2015;

(2) The husband do pay the wife for the interim maintenance of the 2 children of the family in the total sum of $5,000 per month, ie $2,500 per child per month starting from 1 September 2015;

(3) The husband do pay the school fees and school bus fees of the children.

3. By his summons dated 7 September 2017, the husband now seeks to vary the MPS Order as follows:

(1) The order for maintenance pending suit and maid’s expenses payable to the wife be discharged totally;

(2) The children interim maintenance be reduced from $5,000 per month to $3,000 per month, ie $1,500 per child per month;

(3) The outstanding arrears payable under the MPS Order by him between April and August 2017, in the total sum of $72,500, be remitted.

4. In a nutshell, the husband’s application can be reduced into 3 major grounds:

(1) There has been a drastic reduction in his monthly income from $50,000 to about $20,000, caused by (i) the cutting of the business profit that he used to receive from the game centres business of the wife’s brother(s), and (ii) instability of his own business;

(2) He has been taking on additional family expenses of the matrimonial home and of the children, to the extent of about $24,000 per month, set out more particularly in §[36] below;

(3) The wife has sufficient financial means that she has failed to disclosed.

5. The wife opposes to his application, arguing that the husband has sufficient assets, including stock worth of $750,000, to comply with the MPS Order. She further accuses him of leading a luxurious life, such as buying a Tesla of $760,900 in early 2017 and taking his girl-friend to Japan to celebrate the Valentine’s Day between 14-18 February 2017.

Litigation history

6. I shall begin by pointing out that the parties have been litigating since 2015 but the case is nowhere near the stage of financial dispute resolution (FDR). The hiccups are caused by a mixture of events, including the attitude that they have displayed in the case history so far.

7. In respect of the main suit, they have each alleged “unreasonable behaviour” of the other side, with the wife claiming that the husband has an affair with another woman since December 2014, while the husband alleging that she has a dubious relationship with a man. It took them almost 2 years before they could finally agree to have a fresh petition issued on the ground of separation for 1 year (ie this suit). However, up to the date of this judgment, decree nisi is still pending.

8. Then, at various stages of the 1st appointment hearings, the parties had dispute as to the beneficial ownership of their matrimonial home,[1] as well as about 19 companies of the wife’s maiden family. Although the parties have finally agreed that they would no longer allege/claim any 3rd party interest in the above-mentioned property or companies, they find themselves unable to come to term as to the beneficial ownership of 3 game centres licences held in the name of the wife allegedly on trust for her brother(s), in the result of which a trial to determine their beneficial interest seems unavoidable.

9. As I have repeatedly told the parties in various 1st appointment hearings, this is certainly not a big money case. Yet legal costs have been accumulated to approaching $800,000 in total up to May 2018. It is anticipated that further and substantial amount of costs will have to be spent on the trial of the preliminary issue. I thus send out again my strong words to the parties that they should think twice as to how to proceed with their ancillary relief dispute before they lament that their litigation costs have eaten up into all of their assets, thus leaving nothing, if any, for their own children.

Background

10. Before I go into the law and the argument, something should be said about the background.

11. The parties were married in 2007. They have 2 children born within their wedlock, namely a daughter born in 2009 and is now aged 9, and a son born in 2012 and is now aged 6.

12. The parties had/have close connection with in game/games centres businesses. For example, the husband himself is the sole proprietor of GM Amusement Company, specialising in printed circuit board and game machine parts. He used to hold a game centre licence which was sold at $1,950,000 pursuant to an agreement dated 30 April 2014. On the part of the wife, her maiden family, namely her brother(s), own 19 companies running game centres businesses or holding game centre licences. She used to work as an account clerk in one of her brother(s)’ companies earning $18,000 per month. She also claims that she is holding 3 game centre licences on trust for her brother(s), which is now the subject matter of the preliminary issue to be tried in due course.

13. Towards the end of 2014, the wife hired a private investigator and allegedly found out that the husband was having an affair with another woman. She then said that she had to leave her employment since/about 1 February 2015 in order to take care of the children.

14. One day after she left her employment, ie on 2 February 2015, she filed her petition for divorce. By then, the marriage has lasted for about 8 years.

15. In August 2015, the wife took out an application for interim financial provision for herself and the children. The MPS Order was made on 28 August 2015 by consent.

16. On 10 June 2016, the parties reached a settlement on the custody matter after 2 hearings of children dispute resolution (CDR). A consent order dated 10 June 2016 was made whereby they are granted custody of their children jointly, with their care and control to the wife while the husband enjoys defined access.

17. About 1 ½ years after the MPS Order was made, the husband started to default payment since or about 1 November 2016, triggering the wife to take out garnishee proceedings in respect of his HSBC and Hang Seng Bank accounts in early 2017. In the end and by the consent of the parties, a garnishee order absolute was made in respect of the HSBC account to satisfy the then outstanding sum of $62,500 and costs of $5,000, while that of the Hang Seng Bank was discharged.

18. After the garnishee proceedings were concluded, however, the husband continued to default paying $14,500 per month to the wife pursuant to the MPS Order since April 2017. The total outstanding sum cumulated from April 2017 up to August 2017 is $72,500. As at the date of this substantial hearing (ie up to May 2018), the total outstanding sum is $203,000.

19. However, it is pertinent to say that he has continued to pay for the school fees, refreshment and school bus fees of the children, which the wife accepts to be in the sum of $10,893 per month.

20. About 5 months since his default, he took out his summons in September 2017 for variation of the MPS Order.

Applicable Legal Principles

21. The power for this court to make a maintenance pending suit for a spouse and interim maintenance order for the children of the family is set out in sections 3 and 5 of the Matrimonial Proceedings and Property Ordinance (“MPPO”) respectively.

22. The relevant legal principles touching on maintenance pending suit/interim maintenance are succinctly set out by Hartmann JA (as he then was) in HJFG v KCY [2012] 1HKLRD 95, where his lordship quoted Nicholas Mostyn QC sitting then as a deputy High Court judge in TL v ML and Others (Ancillary Relief: Claim against Assets of Extended Family) [2006] 1 FLR 1263, at §§33-38, in particularly §37 as follows:

“ 37. The principles that have emerged over time to guide judges in matters of interim maintenance have been fashioned in the main to ensure fairness. This is well illustrated in the judgment of Nicholas Mostyn QC, sitting then as a deputy High Court judge, in TL v ML and Others (Ancillary Relief: Claim against Assets of Extended Family) [2006] 1 FLR 1263, at 1289, in which, having looked at earlier authorities, he derived the following principles that speak specifically to fairness or are based on the need to ensure it. For present purposes, it is sufficient to cite the relevant principles without citing the judge’s reference to the source of those principles:

i. The sole criterion to be applied in determining the application is ‘reasonableness’, whichis synonymous with ‘fairness’.

ii. A very important factor in determining fairness is the marital standard of living. This is not to say that the exercise is merely to replicate that...

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