Lhc v. Khs
Read the full judgment text of FCMC 3343/2015 on BabelCite. This Family Court judgment was delivered on 7 August 2017 before His Honour Judge I. Wong.
Matrimonial causes – costs – divorce – 1st petition withdrawn and replaced by 2nd petition – 1-year separation by consent – costs discretion – no order as to costs – costs of argument – Petitioner successful in defending Respondent's claim for costs – FCMC 87/2014 and FCMC 3343/2015 – District Court – Judge I. Wong – Order 62, rule 3, RHC – Matrimonial Causes Ordinance (Cap 179) s.11 – Re Elgindata Ltd (No. 2) [1992] 1 WLR 1207 – SJH v RJH [2012] 4 HKLRD 308 – No order as to costs for main suits – Petitioner awarded costs of argument with counsel certificate
Legal issues: Costs of 1st Petition · Costs of 2nd Petition · Costs of the Argument
Outcome: No order as to costs for both petitions; Petitioner awarded costs of the argument with counsel certificate.
Cites 6 cases
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FCMC 3343/2015 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION MATRIMONIAL CAUSES NUMBER 3343 OF 2015 ____________ BETWEEN
____________ FCMC 87/2014 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION MATRIMONIAL CAUSES NUMBER 87 OF 2014 ____________ BETWEEN
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____________________ RULING ____________________ 1.This is my Ruling on the costs of the matrimonial cause in FCMC 87/2014 (“the 1st petition”) and FCMC 3343/2015 (“the 2nd petition”). Both proceedings are between the same parties. 2.For convenience, I shall refer the petitioner wife as “P” and the respondent husband “R” in this Ruling. Factual Background Relevant to the Costs Issues The 1st Petition 3.P was from Taiwan and R a local Chinese. They married in Taiwan in December 1989 and thereafter P moved to live in Hong Kong. The couple has 2 children; a son now aged 26 and a daughter, now 23 years old. 4.On 4 January 2014, P petitioned for divorce on the ground that the parties had been living apart for a continuous period of at least 2 years since March 2003. She pleaded that although the parties were living at the same address, they lived in separated households. They slept in separate rooms, did not cook, clean or eat together; and they did not talk to each other. Further, R stayed 4 nights per week in an address in Shenzhen with a Madam So. 5.These allegations were disputed by R. In his Answer, he denied that their marriage had broken down irretrievably. He further denied that the parties had separated for at least 2 years as alleged. His pleading was drafted in a way more like a witness statement than what a pleading should have been in accordance with Order 18 of the Rules of the High Court (“RHC”). This should not have been the case but regrettably this has become rather prevailing as a practice. It made any reader difficult to discern what the issues in dispute are. Anyway, it seemed to suggest that as at the date of the petition the parties were still living as husband and wife. 6.On 12 August 2014 P applied to amend her petition. On the 2 years’ separation, she sought to specify that R stayed “4 days and 3 nights” per week in Shenzhen (and not “4 nights”). She also sought to add a new ground of unreasonable behaviour on the part of R. She wished to rely upon the following 4 particulars:
7.P’s application for amendment was staunchly opposed. I will come to R’s grounds of opposition in due course. At this juncture, I only need to mention that in the hearing for amendment (“the Amendment Hearing”) on 18 February 2015, at the suggestion of the court, the parties were able to come to a practical solution. Consequently, with the leave of the court, P withdrew her petition and lodged a new petition based on 2 grounds, namely, (1) 2-year separation; and (2) R’s unreasonable behaviour. All the parties’ documents relating to ancillary reliefs were to be transferred to the 2nd petition. There was also an order that the costs of the summons including costs reserved be in the cause of the main suit of the fresh petition, with counsel certificate. 8.The costs of the main suit in the 1st petition have not been formally disposed of. This is the first costs issue that the court has to deal with. The 2nd Petition 9.As a sequel to the 1st petition, P issued the 2nd petition on 20 March 2015, again, on the ground of 2-year separation since March 2003 and the unreasonable behaviour of R. The contents are essentially the same as those in the 1st petition save and except 2 extra paragraphs in relation to R’s unreasonable behaviour (being paragraphs (6) and (7)). 10.Not surprisingly, this Petition invited an Answer and Cross-Petition on 21 April 2015. Contrary to what he had pleaded previously, R admitted that for the matters pleaded in the Cross-Petition the marriage had irretrievably broken down and averred that the parties had separated as from 4 January 2014 (ie the date of the 1st petition). R further cross-petitioned divorce on 2 grounds. The first being one-year separation since 4 January 2014 with the consent of P and the second being the unreasonable behaviour of P. He set out P’s unreasonable behaviour under 5 headings, viz, (1) sexual relation, (2) P’s relation with his mother, (3) unreasonable finance demands, (4) denial of R’s loans and (5) P’s behaviour problems, extending to 5 pages out of a total of 7 pages. 11.P responded by filing a 4-page Answer to Cross-Petition on 6 May 2015, bulk of which was her reply to R’s allegations of unreasonable behaviour. 12.That was not the end of the matter. What followed was R’s 4-page Reply on 20 May 2015. 13.During the 1st Appointment hearing of 16 November 2015 Mr Hariman, on behalf of P, informed the court that P had agreed to one-year separation and for this purpose a consent summons would be prepared. 14.There was however no consent summons. Instead, there was a long lapse of 15 months. Eventually, by their consent summons filed on 22 February 2017, P agreed to amend her petition so that she relies on one-year separation as from at least 4 January 2014 as the ground for divorce. She also agreed to withdraw her Answer to Cross Petition. Conversely, R agreed to consent to divorce on the ground of one-year separation and withdraw his Answer and Cross Petition and his Reply. 15.Unfortunately, the parties were unable to agree on the costs of and incidental to the cause of the 2nd petition. This is the second costs issue that the court has to deal with. Legal Principles 16.In Hong Kong, the basic principle is that costs are in the court’s discretion: Order 62, rule 3, RHC. 17.In general terms, apart from children’s cases, the starting point on costs in matrimonial and family proceedings, as they are in civil litigations, remain to be “costs follow the event”: Re Elgindata Ltd (No. 2) [1992] 1 WLR 1207; Gojkovic v Gojkovic (No 2) [1991] 2 FLR 233; see also Order 62, rule 3(2) & (2A), RHC. That said, it has been opined by the Court of Appeal that because of the special dynamics of family litigation (eg where the case involved children, or where financial resources were inadequate to meet the needs of both parties, etc), the discretion may be broader than in civil matters generally: L v C, (unreported; CACV 169/2006, 9 March, 2008), at §23. 18.Broadly speaking, in the exercise of its discretion in civil cases including matrimonial and family cases, the court will have to take into account, where appropriate in the circumstances, the special matters set out in Order 62, rule 5 of RHC. It is not necessary for me to set out the special matters here. The Parties’ Case in the 1st Petition P’s Case 19.It has been submitted by Mr Hariman that for the reason that the 1st petition was essentially replaced by the 2nd petition, the issue in dispute, ie whether the parties had separated for at least 2 years as pleaded in the 1st petition, had yet to be determined in trial. Indeed, at that point no evidence had been filed nor any submission had ever been made in this regard. As such, neither party should be considered as successful; so the proper costs order should be no order as to costs. R’s Case 20.Ms Chong, counsel for R, disagreed. She argued that R should be given the costs of the 1st petition. Ms Chong placed great reliance on the alleged inconsistencies regarding the breaking down of the parties’ relationship as said by P in her various affirmations. She drew my attention to the following inconsistencies. 21.The first is P’s affirmation dated 4 August 2015. When trying to justify her discovery claim against R dating back to as early as January 2010, P said, at §20, that it was around January 2010 that her relationship with R really broke down. She repeated this in her affirmation dated 8 January 2016: §4. This affirmation was filed in opposition to R’s application for disclosure against her. 22.Ms Chong submitted that these assertions are clearly inconsistent with what P has pleaded in the 1st petition that she had separated with R as from March 2003. This shows P was willing to twist the fact in order to suit her purpose. 23.Ms Chong also referred me to P’s affirmation of 22 April 2016. That was filed in opposition to R’s application for an injunction against the use of his personal documents allegedly obtained unlawfully by P. When P had to explain how she was able to get hold of the documents she affirmed that she and R shared the master bedroom of the former matrimonial home since they moved in until around February 2014. Again, this is in stark contradiction with what she pleaded in the 1st petition that the parties slept in separate rooms and is another salient example that she was prepared to twist the fact according to her need. 24.It has been argued by Ms Chong that the date of separation is a pivotal averment in the 1st petition since the pleaded ground for divorce was 2-year separation without consent. Yet, P contradicted herself in her subsequent affirmations. All versions as to the date of separation were made under oath but all versions could not be true at the same time. P must have lied on the crucial fact of the date of separation. The litigation conduct of the parties is one important factor that the court should take into account in exercising discretion on costs. Putting forward false evidence or false case is a major litigation misconduct. Such misconduct is serious enough even to deprive a wholly successful party of his costs. She referred me to Hong Kong Civil Procedure (2017), §62/2/7; Hung Fung Enterprises & Others v The Agricultural Bank of China [2012] 3 HKLRD 679, §97; Ho Shu Kwong Wilson v Chiang Chun Yuan alias Paul Chiang [2002] 3 HKLRD 419, §5; and Big Island Construction v Wu Yi Development Company Ltd & Others [2014] 2 HKLRD 1054, §§231, 234, 236, 239 & 240. Discussion – the 1st Petition 25.As said, leave was granted for P to withdraw the 1st petition and lodge the 2nd petition. The starting point is, in my view, to ask what is the “event” of the cause in the 1st petition? 26.Ms Chong argued that far from being a winning party, P is in fact a losing party in that she withdrew the 1st petition. I disagree. In order to explain why I have come to this view it is necessary for me to revert to what happened in the Amendment Hearing. 27.As said above, P’s application for amendment was strenuously opposed. In her written submissions for the Amendment Hearing, Ms Chong argued that the proposed amendments related to unreasonable behaviour, which was not pleaded in the original petition and was thus a new cause of action for divorce. Such proposed amendments were not mere modification, addition to, deletion or substitution of the averments of the original cause of action (ie 2-year separation). On that basis, she seemed to have argued that P should not be allowed to add a ‘new cause of action” (ie unreasonable behaviour) by way of an amendment. In the course of argument, Ms Chong seemed to have retracted somewhat and agreed that P was entitled to plead “unreasonable behaviour” with supporting particulars of facts that occurred prior to the date of the petition by way of amendment. As for those particulars of facts that happened after the 1st petition, because of the principle of “relation back” these have to be dealt with by way of a supplemental petition. Yet, she maintained that in any case the particulars of facts proposed to be pleaded were so scanty and the alleged use of abusive language was merely an isolated incident of minute gravity that they disclosed no reasonable cause of action. 28.During the Amendment Hearing I reminded the parties of the relevant provisions in the Matrimonial Causes Ordinance (Cap 179) (the “MCO”). Section 11 of the MCO provides that the sole ground for presenting a petition for divorce shall be that the marriage has broken down irretrievably. Section 11A(2) then goes on to say that:
29.Thus, it has always been said that there is only one ground for divorce - that the marriage has broken down irretrievably. A petitioner may obtain a decree of divorce by proving one of the five facts set out in the provision. “Unreasonable behaviour” itself is not a “cause of action” as such contended for by Ms Chong. To me, it is a misconception to say that “unreasonable behaviour” is a cause of action akin to a cause of action in contract or in tort. On that analysis, subject to any other valid objections R might have such as delay I have no doubt that P was entitled to add “unreasonable behaviour” to the 1st petition and plead those particulars which happened prior to the petition. As for those particulars of facts since the date of the 1st petition, she could plead them by way of a supplemental petition. 30.Further, I indicated in the Amendment Hearing that I disagreed with Ms Chong that the particulars of facts were insufficient and it was unhelpful to import “no reasonable cause of action”. Specifically, I pointed out the allegation that R maintains an improper relationship with other female which, according to P’s supporting affirmation of 26 September 2014, happened since 2009 should be grave enough, not to mention the allegation of using abusive language to insult P when she asks for monthly expenses. The court would have regard to the whole history of the relationship. Nevertheless, this would have to be decided in trial. 31.At the same time, Mr Tang, solicitor for P in the Amendment Hearing, relied upon a few paragraphs in §10.12 of Rayden & Jackson on Divorce and Family Matters (18th Edn) to support his client’s application. It is not necessary for me to dwell into these paragraphs because given R’s stance as it was in the hearing, it was clear that P was entitled to at least some of the proposed amendments. 32.It was against this backdrop that the court made the observation that there could be 3 options available for the parties. Option 1 would be for the parties to engage in full arguments on whether P was entitled to add the “unreasonable behaviour” ground and all the particulars of facts (whether before or after the 1st petition) by way of amendment. Option 2 would be for P to amend the 1st petition by including “unreasonable behaviour” and those particulars that occurred before the 1st petition and to plead those post-1st petition particulars by way of a supplemental petition. Lastly, option 3 would be for P to withdraw the 1st petition and start a fresh petition containing both 2-year separation and unreasonable behaviour. Eventually, both parties chose option 3 to resolve their differences; hence the directions of the court as set out in paragraph 7 above were given. 33.Therefore, whatever the respective levels of enthusiasm, the decision to dispose of the 1st petition in the manner described above was a joint one. That was seen as a practical way out. I agree with Mr Hariman that the 2-year separation ground was never ventilated and tested. It remained a live issue in the 2nd petition and therefore would still require adjudication by the court. In her affirmation in support of the amendment application, P explained why she did not rely on “unreasonable behaviour” when she took out the 1st petition was because she did not wish to embarrass R in eyes of their 2 adult children. That was done at the instigation of R but then in view of R’s adamant opposition, the unreasonable behaviour ground turned out to be necessary. Again, whether this assertion is true or not has not been tested. If P’s version is true, it would mean the amendment was occasioned by R. As such, it must be correct that neither party could be considered as a winner or a loser. That is the “event” of the 1st petition. 34.Further, the reality is the litigation had never been disposed of at that point but in actuality it was being incarnated in the form of the 2nd petition. For all these reasons, I gave an order that the costs of the amendment summons including costs reserved to be in the cause of the main suit of the fresh petition. 35.All the affirmations that Ms Chong relied upon were post withdrawal of the 1st petition. Whilst I do not wish to disparage Ms Chong’s submissions regarding P’s inconsistent affirmations, I must say they have no relevance to how and why the 1st petition was withdrawn. 36.Now the parties have come to an agreement in the 2nd petition that they should obtain a divorce on the ground of one-year separation by consent what should be the proper costs order for the 1st petition? One-year separation by consent is said to be a non-fault divorce. As can be seen below (in paragraph 38) Ms Chong also agreed that the costs subsequent to the agreement of the parties should be no order as to costs. I think this is the correct approach. For this reason and also for the same reasons that I have said regarding the costs of the amendments summons I have no doubt that the proper costs order should be no order as to costs; and I so order. The 2nd Petition P’s Case 37.P’s case is simple. The parties have now agreed to one-year separation with consent. This is the position that was made clear by P as early as mid to late 2015. One-year separation with consent is a non-fault divorce and so the normal costs order to be followed is no order as to costs. Mr Hariman referred me to Family Law and Practice in Hong Kong, at §2.063. R’s Case 38.It is clear that R shifted his position. In her skeleton submissions, Ms Chong said in unambiguous terms that R should have both sets of costs (ie those of the 1st and the 2nd petitions). When it came to the hearing Ms Chong agreed that if both parties agree to divorce the normal costs order should be no order as to costs. On that basis, she said R is seeking costs of the 2nd petition including those of the cross-petition up to 16 November 2015 when P agreed to one-year separation only; and each party is to bear his own costs as from 16 November 2015 including those of the consent summons. 39.I need to mention that upon hearing R’s latest position Mr Hariman spared no time to change his stance by saying, in his reply submissions, that P should have the costs as from November 2015. The reason being that substantial efforts were made by P unilaterally to try to come up with terms agreeable to both sides but there was no response from R. Intervening Events 40.The following intervening events are pertinent to the matter under consideration. 41.On 28 February 2015, before P took out the 2nd petition, R’s solicitors informed P, by way of an open letter, that R would give his consent for divorce on the ground of one-year separation with separation date commencing from January 2014, leaving the matter relating to ancillary relief to be decided by the court. There was no response from P. 42.R wrote again on 9 March 2014 that if P failed to give a favourable reply within 3 days, he would withdraw his consent. There was again no response. 43.In the interim, the 2nd petition was taken out on 20 March 2015. 44.On 8 October 2015 R took out a summons seeking, inter alia, an order that P had an undefended cause to his one-year separation. 45.Then on 10 November 2015 R’s solicitors wrote again, by open letter, proposing the following terms:
It was stated in the letter that the proposal would lapse within 3 days. 46.What followed was, as said above, the concession made by P that she agreed to one-year separation during the First Appointment hearing of 16 November 2015. Given this concession, R’s application of 8 October 2015 became unnecessary and was adjourned sine die. Discussion 47.Ms Chong argued that by the time P filed the 2nd petition it was clear that the marriage had broken down irretrievably and that the parties had separated for one year since 4 January 2014. The marriage could have been dissolved by consent on one-year separation. P should have acted reasonably and settled the main suit amicably with R by filing a joint application to divorce on the ground of one-year separation. 48.In spite of R’s proposal of 28 February 2015 P chose to ignore it and proceeded to file her fresh petition on 20 March 2015. She withheld her consent until after substantial costs had been incurred and after R had taken out a summons for an order that P had an undefended cause to his one-year separation that she finally conceded. Such attitude and conduct defy the underlying objectives as set out in Order 1A, RHC. All the costs on the main suit in the 2nd petition could have been avoided should P have acted reasonably by accepting R’s proposal. 49.Ms Chong referred me to what Hon Cheung JA said in SJH v RJH [2012] 4 HKLRD 308, at §11(7),
50.Ms Chong also emphasized P’s litigation misconduct that she gave inconsistent versions regarding the date of separation. 51.I agree with Ms Chong that it achieved no purpose for P to insist upon the 2-year separation and the unreasonable behaviour of R. What P should have done was to accept the proposal well before she took out the 2nd petition. If that had happened, the parties would have obtained a divorce fast and painlessly simply on the ground of one-year separation. To this, all Mr Hariman could say is that at that time counsel had not been retained yet. I am not satisfied with the answer. P was at all times legally represented. She should have been able to act reasonably and sensibly. 52.However, my agreement with Ms Chong stops at here and goes no further. If what R had filed, in response to the 2nd petition, were a neat and tidy Answer and Cross-Petition on the ground of one-year separation only, I would be in total agreement with Ms Chong. Ms Chong’s argument that it achieved no purpose for P to insist upon 2-year separation and the unreasonable behaviour of R and her reliance on SJH v RJH, supra, is a double-edged sword – it cuts equally deep into R. If one-year separation would be sufficient to do the trick, then equally it was utterly unnecessary and a waste of costs for R to have cross-petitioned on the ground of P’s unreasonable behaviour thereby generating substantial costs in pleadings. As I see it, that part of the pleading served no purpose other than further exacerbating the rancour against each other. 53.In Ho Shu Kwong v Chiang Chun Yuan [2002] 3 HKLRD 419, it has been said by Woo JA (as he then was), at 427E-H, that a wholly successful defendant should be given his costs unless there was evidence that he: (a) brought about the litigation; (b) had done something connected with the institution or the conduct of the suit calculated to occasion unnecessary litigation or expenses; or (c) had done some wrongful act in the course of the transaction of which the plaintiff complained of; see also FBC Construction Co Ltd v Lee Ben [2014] 2 HKLRD 1054, at §§ 237-238. I consider (b) is relevant here. Whilst the contents of the 2nd petition were well within anticipation, the same could not be said for R’s unreasonable behaviour claim. Without descending to the minutiae, the impression I gather is that the costs occasioned by R’s unreasonable behaviour claim should be at least more or less the same as those occasioned by the 2nd petition, if not more. 54.I have not lost sight of the argument that P has apparently given some inconsistent statements in her affirmations regarding the date of separation. I say “apparent” because these statements have not been tested. The court has yet to hear the oral testimonies of the parties. I am sure that if the parties are not able to settle the ancillary relief matters, the date of separation would certainly be an issue that required determination by the court. Nevertheless, with the conclusion that I have come to, I do not consider these inconsistent statements are relevant to the issue of costs here. They simply have no bearing on the one-year separation. 55.For the above reasons, I am driven to the conclusion that the fair and proper order for the costs of the main suit up to 16 November 2015 should be no order as to costs. 56.I agree with Mr Hariman that after the parties had agreed on the proper course to be taken on 16 November 2015, the costs incurred thereafter were exchanges between the parties over the procedures and the amendments ought to be made and the issue of costs. From the correspondences that I was referred to during the hearing, it seems clear to me that during that period of time there were discussions between the parties on how the agreement could be implemented and how the costs were to be disposed of. Specifically, there were discussions on whose pleadings should be amended or withdrawn; and eventually, it was agreed that amendment is to be made to the 2nd petition. I can see that during that time there were seemingly more initiatives from P’s side and there was some lapse of time before R responded but I do not see this a “misconduct” on the part of R. It is clear to me that the fair and proper costs order as from 16 November 2015 should also be no order as to costs. Orders 57.For the above reasons, I give an order that there be no order as to the costs of and incidental to the cause in FCMC 87/2014 and FCMC 3343/2015. Costs of the Argument 58.As for the costs of the argument, P has been successful in defending R’s claim for costs. I see no reason why P should not be given the costs, with counsel certificate; and I so order.
Mr Wayne Hariman, instructed by Gilbert Tang & Co, Solicitors, appeared for the petitioner Ms Sezen Chong, instructed by K P Lam & Co, Solicitors, appeared for the respondent |
Cases cited in this judgment
Further hearings and rulings under FCMC 3343/2015