Cccr v. Cll

FCMC 17824 / 2013

[2018] HKFC 95

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES

NUMBER 17824 OF 2013

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Coram : Deputy District Judge J Chow in Chambers (Not Open to Public)

Date of Hearing : 24 – 26 January 2018

Date of Judgment :  6 July 2018

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J U D G M E N T

(Section 17 Application and Ancillary Relief)

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Introduction

1.The petitioner (“the husband”) seeks an order for ancillary relief against the respondent (“the wife”) together an application pursuant to section 17 of Matrimonial Proceedings and Property Ordinance, Cap 192 (“Cap 192”) for an order of avoidance of dispositions of matrimonial assets of the family.

2.The husband joined the 1^st – 3^rd interveners to this application[1]  namely, their daughter (“the daughter”) as the 1^st intervener; a female friend of the wife as the 2^nd intervener (“LSY”); and the wife’s god mother (“HK”) as the 3^rd intervener. All the 1^st – 3^rd interveners did not attend trial. The husband’s solicitors have filed affirmations of service to prove due service by ordinary post.

3.Only the husband and wife testified.

Background

4.The husband and the wife were married in Hong Kong on 12 April 1986. The husband filed a petition for divorce on 12 December 2013, decree nisi was granted on 4 March 2015. 

5.At time of trial, the husband was 54 years of age and the wife was 60. The husband was living in the mainland at a rent-free property owned by his friend; the wife was living with the daughter in a self-owned property of the daughter in Hong Kong Garden. Both the husband and the wife were unemployed. Their only daughter was aged 31. She was working with a private bank in Hong Kong.

6.Before marriage, the husband was a clerk and the wife was a quality checker. It is on common ground that they were working in the footwear business since their marriage. In or about 1994, they started their footwear business, DC Company (“DC Company).  In or about August 2001, the husband and the wife also set up a footwear retailing company called P Co. Ltd (“P Company”) in Hong Kong. They were shareholders and directors of both DC Company and P Company. The husband was responsible for the sales and management in the mainland, usually stationed in Dongguan, China. The wife was responsible for administration and accounting, usually stationed in Hong Kong. The husband and the wife had no other employment.

7.The footwear business was once profitable.  Since 2006, the footwear business did not make profit and had recorded losses. In or about November 2011, DC Company ceased operation. On 31 May 2013, both DC Company and P Company were deregistered.

The husband’s case

8.The husband’s case is summarized in his narrative affirmation filed on 26 May 2017. The husband said, DC Company had paid him a monthly salary of HK$35,000 whilst the wife was paid HK$30,000. He stayed in a hotel while he was working in Dongguan. He was a signatory of company cheques, he can cash the company cheques for his expenses in Dongguan. On the other hand, the wife settled his personal expenses whilst he was back in Hong Kong. The husband claimed he has no bank account in Hong Kong because his wife will pay everything for him. The husband said, from time to time, the wife used to transfer profits from the footwear business to her personal HSBC bank account (“the 888 account”); she had also maintained a personal account with The Bank of China (“the BOC account”).

9.On 1 July 1987, the husband and wife purchased their first matrimonial property, Ching Wah Court. On 21 November 2003[2], the wife purchased a residential property in Sorrento, West Kowloon under the consent scheme. The husband, the wife and the daughter moved in Sorrento after its completion in 2006. The husband said initial deposits for the purchase of Sorrento came from the wife’s personal savings, which were profits from the footwear business. On 8 March 2003 and 4 November 2004, the wife purchased 2 carpark spaces in Sorrento (“Carpark No. 7X” and “Carpark No.4X” respectively). One carpark space was leased and the other for the family’s use. The husband said the wife acquired both carpark spaces by profits from the footwear business.

10.Since 2006, the footwear business recorded no profit and started to incur debts. The wife sold Carpark No. 7X in 2009 to settle the debts. In or about November 2011, the husband returned to Hong Kong. The husband attempted to save the business by drawing finds from his credit cards, he incurred debts in sum of HK$380,000. He has also injected HK$780,000 to the footwear business. He owed his younger brother HK$400,000 as well. The husband deposed in his narrative affirmation that his current liability was HK$750,000.

11.On 29 July 2011, the wife bought Hong Kong Garden, Tsing Yi where the daughter was the registered owner.

12.On 24 May 2012, Ching Wah Court was sold at HK$2,035,000. The proceeds, less expenses around HK$1,230,642 were made to further settle the losses and debts of the footwear business. On 18 June 2012, Sorrento was sold at HK$17,700,000 to settle debts of the footwear business as well. The husband said the wife has kept the proceeds HK$5,819,896 from the sale after repaying all outstanding mortgages and debts of the footwear business prior to both DC Company and P Company’s deregistration on 31 May 2013.

13.The family moved to a rented property in Rivera Garden, Tsuen Wan after the sale of Sorrento. In or about February 2012, the husband went to Dongguan again for further business opportunities. The husband had lived in a premise provided by his friend, Mr. Law, he started to live on loans from his brothers.  

14.The husband complained, the wife had dissipated the matrimonial asset, mainly profit derived from the footwear business during their marriage. He further alleged the wife has had hidden asset of which quite a number of transfers were effected to her family members. Furthermore, she kept all proceeds of the sale in sum of HK$230,000 the private vehicle, a Mercedes benz without his consent and had in her possession the husband’s luxury watches, valued around HK$490,000.

15.The husband valued the aggregate matrimonial assets should exceed HK$10 million. The husband therefore seeks an order of both section 17 and ancillary relief against the wife as follows[3]:

(a)  The wife’s dispositions of (HK$342,000 + HK$900,000 + HK$1.25 million) HK$2,492,000 to be set aside against the daughter, LSY and HK. 

(b)  A declaration that the daughter was holding 10% of the property in Hong Kong Garden in trust for and on behalf of the husband in sum of HK$695,000[4] and a payment into court of such sum;

(c)  Payment of HK$5,174,436 being ½ share of the aggregate matrimonial asset (excluding the Carpark No.4X in Sorrento); and

(d)  ½ share of the proceeds of Carpark No.4X in Sorrento, less expenses and disbursement, no less than $2.2 million in open market.

The wife’s case

16.The wife deposed in her affirmation filed on 23 June 2014 that she has been unemployed since 1 April 2012. She had HK$160,000 personal savings. She relied on the rental income of HK$3,000 per month from Carpark No.4X in Sorrento. Her monthly expenses were HK$14,200. She could have sustained a living with the person savings for 1 – 2 years. The wife updated her savings in her narrative affirmation filed on 9 June 2017 with a balance of HK$49,758.58 in her 888 account and HK$11,711.54 in the BOC account.

17.In or about 2011, the footwear business was on the verge of cessation. The business’ liabilities, more particularly DC Company, was more than HK$9,940,000[5]. Since the downturn of footwear business, the wife had borrowed money from her family and friends in millions and she has subsequently repaid the following:

(i)  her brother (“CC”) – HK$1,931,947;

(ii)  her uncle (“LKP”) – HK$887,172;

(iii)  her younger sister (“CY”) – HK$200,000;

(iv)  her mother (“LML”) – HK$487,388; and

(v)  her friend (“CSL”) – HK$150,000.  

18.The husband also alleged the wife to have withdrawn HK$1,483,261 from her personal bank accounts without valid reason. The wife claimed such sum was withdrawn to repayment of personal debts due. 

19.Apart from the above, she realised the family assets and had retained the proceeds of (i) Ching Wah Court HK$1,230,642; Sorrento HK$5,638,146; Mercedes benz HK$230,000; and carpark No. 7X in Sorrento HK$995,000 to cover the debts of the footwear business. The aggregate sum was HK8,093,788[6]. The wife said the proceeds were applied as repayment of loans advanced to her personally.

20.The wife also deposed in her narrative affirmation, apart from loans from her family members, the wife borrowed money from LSY and HK.  On 17 December 2013, she has repaid $1 million to HK for a loan advanced to her on 10 April 2008 whilst the business was making a loss.

21.The wife explained she has obtained two loans from bank to pay the initial deposit of Hong Kong Garden. She further borrowed HK$70,000 and HK$130,000 from LSY and her friend, CSL respectively. The wife settled the credit card loan by monthly instalments at HK$7,765.81 and HK$7,588.64.

22.As at the date of trial, the wife still owe her brother, CC over HK$1 million[7] and a substantive sum to her uncle, LKP.

23.The wife clarified, after she has sold the Mercedes benz in July 2012, she has repaid HK$80,000 in cash to LSY and HK$150,000 to CSL.

24.The wife said, save and except she has paid the initial payment of purchasing Hong Kong Garden for her daughter, which was meant to be a gift, she has applied other assets to pay off debts of the DC Company.  She has injected funds to DC Company by seeking personal loans from her family and friends. As at the date of trial, she has not satisfied the outstanding personal loans owed to her brother, CC and her uncle, LKP. The only matrimonial property remaining as at today is one of the Carpark No. 4X in Sorrento, valued at HK$2,200,000.

The open offers

25.The husband’s open offer almost mirrored with his claim of ancillary relief: he offered the wife to settle this ancillary claim at HK$5 million and ½ share of the proceeds of the sale of Carpark No. 4X in Sorrento.

26.The wife’s open offer was to sell the carpark space No. 4X in Sorrento, not less than HK$2.2 million in the open market, the proceeds less all expenses to be shared equally among herself and the husband.

The two applications

27.I shall deal with the section 17 application first, i.e. whether the wife as dissipated the assets to the daughter, LSY and HK in sum of HK$2,945,000.  The ancillary relief between the parties including issues raised by the husband on the wife’s hidden asset would follow.

Section 17 application

28.The husband claimed the total value of matrimonial assets as at date of trial is more than HK$10 million. The wife, with a view to defeat his claim for ancillary relief, has disposed the matrimonial assets in sum of HK$2,945,000 to (i) the daughter, (ii) LSY and (iii) HK. The husband took out application pursuant to section 17 of the Cap 192[8] to set aside the dispositions mentioned as follows:

(a)  HK$453,000 - initial payment in sum of paid to the daughter for purpose of purchasing the property in Hong Kong Garden;

(b)  HK$342,000 - monthly payments ranges from HK$7,000 – HK$9,000 per month totalling HK$342,000 paid to the daughter from January 2013 until November 2016;

(c)  HK$900,000 – payment to LSY; and

(d)  HK$1.25 million - payment to HK.

The legal principles on section 17 application

29.The notice of section 17 application was filed on 1 December 2014, the wife bears the burden of proof in dispositions less than 3 years from the application. She has to prove such dispositions were not intended to defeat the husband’s claim for ancillary relief.

30.The test on “intention” can be found in Kemmis v Kemmis (Welland and Others, Interveners) [1988] 1 WLR 1307, referring to the English equivalence, section 37 of the Matrimonial Causes Act 1973, Lloyd LJ an Nourse LJ enunciated at 1326 C-H and 1330 H – 1331 B:

“1326 …What is the meaning of “intention” in section 37(2) of the Act of 1973? Upon this question we had little if any assistance from counsel, although I understood Mr. Trace to concede that a disposition might be reviewable even though not made with the sole intention of defeating the wife's claim for financial relief. But how far does that concession go? Does the husband's intention to defeat the wife's claim have to be the dominant intention? Or is it sufficient that it was part of his intention? Is “intention” divisible at all? A man may act from mixed motives. But can he have mixed intentions? I do not find these questions easy. As in other branches of the law, the more one seeks to analyse the meaning of the word “intention” the harder it becomes.

In the present context three things are, I think, plain. First, we are concerned with the husband's intention in a subjective sense. It is his state of mind which we have to investigate, not the consequence of his acts. This much at least is clear from section 37(5) of the Act, whereby the relevant intention is presumed if the disposition has the relevant consequence, but only if the disposition is less than three years before the date of the application, and then only unless the contrary is shown. Secondly, as in every case where we are called on to investigate a person's intentions, the court is necessarily thrown back on inference. It will be a rare case where the spouse declares his state of mind in advance, and even then his declaration would not be conclusive, or even very persuasive, unless it is against interest. Thirdly, in determining whether a spouse has the requisite state of mind, a court may have regard to the natural consequences of his act. It is true that there is no presumption, unless section 37(5) applies. Nor, generally, would the natural consequence of the disposition be enough by itself to support an inference of intention. But the natural consequence of the disposition would certainly be a factor to be taken into account in deciding whether or not to draw the inference of intention in any given case.”

“1330….I agree with Purchas and Lloyd LJJ that what the judge had to find was a subjective intention on the part of the husband. Moreover, I think it clear that it did not have to be his sole or even his dominant intention. It was enough if it played a substantial part in his intentions as a whole. If it were otherwise, section 37(2) would fail to catch the case where a husband makes a disposition with the dominant intention of gratifying his mistress and only the subsidiary intention of defeating his wife's claim for financial relief. I feel sure that that was not the intention of Parliament…”

31.In C v. T & others (FCMC No.12488/2013), HHJ Melloy enunciated in paragraph 40,

“40. I agree that in considering the intention of the parties it is necessary to look at each disponor’s conduct. In other words can each side’s intention to defeat the other’s claim, be gleaned from their conduct at the time in question ? Consequently, I accept that the circumstances surrounding the making of the dispositions are highly relevant (my emphasis).”

Evidence on section the husband’s section 17 application

The daughter’s property – Hong Kong Garden – HK$453,000

32.The husband alleged, in 2011, the wife has paid initial payment HK$453,000 for the daughter in the acquisition of a property in Hong Kong Garden. The husband disagreed it was meant to be a gift for the daughter, he believed it was the wife’s act to diminish the value of the matrimonial assets and thus to defeat his ancillary claim. The husband claimed 10% ownership of the property. The sum was disposed within the 3 – year presumption period, the wife has the burden to proof to the contrary.

33.The wife explained around that time, the daughter requested to move out from the matrimonial home. She had an idea to purchase a property, she asked the wife to fund 10% initial deposit. The daughter agreed to pay the mortgage repayments. The wife once enquired with the husband about the daughter’s proposal, she was told to make the decision herself. The wife said, as a mother, she should support the daughter to acquire her own property. The wife paid the 10% initial deposit in sum of HK$453,000 by two of her credit cards. She denied she has used the funds from DC Company.  

34.The husband’s evidence defeat his claim under this head, his evidence is inconsistent. The husband complained the wife should not have assisted the daughter to acquire her own property when DC Company was in financial crisis. The husband then criticized the wife should have opted for a property located in prime location, not Hong Kong Garden in the New Territories. Notwithstanding this, the husband testified during cross examination, should the daughter told her the property was meant to be a gift from the wife, in order to maintain a good relationship with the daughter, he would not have insisted on this part of the ancillary claim.

35.Nonetheless, bearing in mind the wife has the burden to prove to the contrary, I accept the wife’s payment of 10% initial deposit did not couple with the intention of defeating the husband’s ancillary claim. The reason being, the husband’s divorce petition was only filed in 2013, which is 2 years after to the acquisition of the property in Hong Kong Garden. Both the husband and the wife have actually discussed this issue. It is surprising for a mother to assist her children nowadays to own their properties by providing funds for initial deposit.  The payment itself was not done by direct transfer of funds from DC Company but was paid by the wife’s credit card and loans from her friend. She was required to repay the sum owed accordingly. The husband’s section 17 application under this head failed.

The monthly contributions to the daughter – HK$342,000

36.The husband alleged the wife dissipated matrimonial assets to the daughter with an intent to defeat his ancillary claim when she paid monthly contribution to her as household expenses after she has moved Hong Kong Garden.  The aggregate payment claimed was $342,000, being $9,000 from January 2013 – December 2013; $7,000 from January 2014 – December 2015; and occasionally $6,000 in 2016. The sum was disposed within the 3 – year presumption period, the wife has the burden to proof to the contrary.

37.The wife explained the payments were normal household expenses. She complained, for most of the time, the husband had lived in the mainland without providing daily support for the daughter and herself. She relied on her savings in her 888 account to pay daily expenses. The wife only started to contribute to the daily expenses to the daughter after she had moved to reside with her in Hong Kong Garden. The wife said HK$6,000 – HK$7,000 was reasonable because the daughter was responsible for  mortgage payments.

38.I can say no more this is a fair account of the needs of the wife. The monthly contribution reflected a daily expenses around HK$200 odd per day. I find the monthly household expenses were spent for daily needs of the wife from January 2013 to December 2016 and were disposed of with no intention of defeating the husband’s claim of ancillary relief. The husband’s section 17 application under this head failed.

Transfer to LSY, the wife’s female friend – HK$900,000

39.The husband alleged the wife has paid HK$800,000 and HK$100,000 to LSY in cash on 12 November 2013 and 17 December 2013 respectively. The wife explained they were repayment of loans borrowed from the LSY in September 2009 and 7 March 2011. The two sums were disposed within the 3-year presumption period, the wife has burden to prove to the contrary.

40.The evidence before me was a declaration of the LSY stating LSY has advanced a personal loan to the wife in sum of HK$800,000. The wife produced a bank transfer application form dated 29 September 2009, in that HK800,000 was transferred to the bank account of DC Company[9]. I accept, at time when DC Company was in financial difficulty, the wife advanced loans from different person to settle the debts.  I accept the wife’s account that she has borrowed the $800,000 from LSY and has repaid accordingly.

41.The wife said, another personal loan in sum of HK$100,000 was made verbally with LSY. Nevertheless, the sum referred to by the wife was inconsistent in her evidence. She stated in her 9^th affirmation she had borrowed HK$70,000 from LSY on 7 March 2012 but she has repaid HK$80,000 on 20 July 2012. Then, the wife stated the loan became HK$100,000 in her narrative affirmation. Notwithstanding this, LSY did not mention HK$100,000 loan in her affirmation. For reason of the inconsistencies, I am not satisfied the wife could prove to the contrary that HK$100,000 was not disposed of with the intention to defeat the husband’s ancillary claim.

42.On this part, I accept the wife’s repayment of HK$800,000 was done with no intention to defeat the husband’s ancillary claim. Yet, the wife could not prove to the contrary the transfer of HK$100,000 to LSY has no such intention. I am satisfied the transfer of HK$100,000 to LSY should be set aside and should be added back to the matrimonial assets.

Transfer HK, the wife’s god mother $1.25m

43.The wife said, on 19 June 2012 and 17 December 2012, she transferred HK$250,000 and HK$1 million respectively to HK. The wife explained she had borrowed HK1 million from HK in April 2008. Both sums were loans advanced by HK to the wife for the purpose to settle the debts of DC Company. The sum was disposed within the 3 – year presumption period, the wife has the burden to proof to the contrary.

44.The wife explained with evidence that both HK$250,000 and HK$1 million were personal loans for settlement of the debts of DC Company. The wife was able to provide with a copy of cashier order to prove the sum was paid to DC Company[10]. A subsequent amount of $1 million was borrowed from HK. The wife submitted the bank statement of DC Company and the repayment of HK$250,000[11] as evidence of the transfer to the company account of DC Company and repayment to HK.

45.The husband challenged the cashier orders and bank statements were insufficient to prove the sum was injected to DC Company. I do not agree. I do not expect, the wife would ask for the proof of the application of the cashier order by HK when it was imminent for her to secure funds to save DC Company. HK was the god mother of the wife, with their close relationship, I am satisfied the wife has sufficient and relevant evidence to prove to the contrary under this head. Such sums were disposed of with no intention of defeating the husband’s claim of ancillary relief. The husband’s section 17 application under this head failed.

Conclusion of section 17 application

46.To conclude, amongst all sums claimed by the husband in the section 17 application, only the transferred amount HK$100,000 to be set aside against LYS (the 2^nd intervener) and such sum be added back pursuant to the husband’s section 17 application as matrimonial asset;

Ancillary relief

47.As a recap, the husband is seeking ancillary relief as in paragraph 15 above. The wife is willing to share the proceeds of the sale of Carpark No. 4X equally after deduction of expenses and disbursements.

48.At trial, no other witnesses were called to testify.  The standard of proof in an ancillary relief application is no different from a civil claim to be a balance of probabilities.

Applicable principles for ancillary relief

49.The landmark case of LKW v. DD (2010) 13 HKCFAR 582, Mr. Justice Chan PJ laid down four principles of manner that section 7 should be approached, HH Judge George Own has succinctly summarized in CL v. LWP & others (FCMC 16222 of 2012), are that

(i)  The first is that the implicit objective of a section 7 exercise is to arrive at a distribution of assets which is fair as between the parties;

(ii)  The second is that the concept of fairness requires the refutation of any gender or role discrimination;

(iii)  The third principle is that, with a view to eliminating insidious discrimination and promoting fairness, judges should check their tentative views on distribution against a “yardstick of equal division” which should be departed from only for good, articulated reasons;

(iv)  The fourth principle is that the court should not countenance any attempt to engage in costly and often futile retrospective investigations of the failed marriage which tend to deplete the parties’ (and the courts’) resources and to increase antagonism and discourage settlement. 

50.A 5 – stage test is well laid down in LKW v. DD:

“Step 1: Identification of assets.

70. The first step in the exercise is to ascertain the financial resources of each of the parties calculated as at the date of the hearing. In particular, under section 7(1)(a), the court must have regard to “the income, earning capacity, property and other financial resources” which each of the parties “has or is likely to have in the foreseeable future”. The object will of course be to compute the net financial resources, taking account of all material liabilities. At this stage, the court need not attempt to distinguish between matrimonial and non-matrimonial property, that being an exercise best undertaken (if necessary) when considering distribution of the assets.

…..

73. The parties have an important duty to ensure that the court has sufficient information regarding their assets. They must make full and frank disclosure and a party who fails to do so runs the risk of the court drawing adverse inferences and robustly attributing assets to him or her, or making adverse costs orders.

…..

Step 2: Assessing the parties’ financial needs

The next step is for the court to assess the parties’ financial needs.  As has been noted, the section 7 exercise often stops at this point since the total resources may be insufficient to go beyond or even to meet both parties’ needs.  If so, no room is left for the application of any sharing principle.  Addressing the needs of say, the wife and children may immediately absorb more than half of the total assets.  If so, “needs” are, for want of any alternative, determinative.  Where the assets are meagre, a “clean break” may not be possible and it may be necessary to have recourse to an order for periodical payments.

…..

Step 3: Deciding to apply the sharing principle

80. If surplus assets would remain after the parties’ needs have been catered for, the next step in the exercise should generally be for the court to apply the sharing principle to the parties’ total assets, leaving the “needs” question previously considered to be dealt with under that principle (as pointed out by Sir Mark Potter P in Charman v Charman (No 4) cited above).  In other words, the court should not make an immediate allocation but should return to “needs” for them to be dealt with alongside all other material factors in the processes described below as Steps 4 and 5.

….

82. The point reached at this third stage of the section 7 exercise therefore involves the court deciding that the sharing principle applies and taking the view that the total assets should be divided equally between the parties unless there is good reason, capable of articulation, for departing from an equal division.  It is worth emphasising, however, that as pointed out by Lord Nicholls,  the court will often ultimately not arrive at an equal division.

Step 4: considering whether there are good reasons for departing from equal division

83. The fourth step therefore involves considering whether good reasons exist for departing from the principle of equal division.  Any such departure means increasing or reducing one party’s share and correspondingly reducing or increasing the share of the other.  The question for the court is whether the balance ought to be shifted from a point of equality to some other point in the circumstances of the case.  This is necessarily a complex question which raises a range of separate issues. 

84. What then are potentially good reasons for such a departure?  The answer is to be found in the terms of section 7 and the implicit objective of a fair distribution of the assets.  Any of the matters listed in paragraphs (a) to (g) of section 7(1) may provide an appropriate reason, as may the “conduct of the parties” and “all the circumstances” referred to in section 7(1).  The catch-all category of “all the circumstances” makes relevant any matter which bears on the fairness of the financial outcome in a matrimonial context. 

85. It is important to stress that while such factors, individually or cumulatively, are potentially capable of resulting in a departure from an equal division, a finding that one or more of those factors are engaged does not necessarily mean that a departure must occur.  The weight to be given to such factors is in the court’s discretion to be exercised in Step 5 as described in Section E.6 below.  It cannot be over-emphasised that the matter is fact-specific and discretionary.  The sharing principle must not be mechanistically applied.

…..

Step 5: Deciding the outcome

131. It is worth reiterating that, having gone through the processes I have compendiously called “Step 4”, the court is not bound to depart from equality in the division of the parties’ assets even if one or more of the factors considered are engaged on the facts.  The weight to be given to such considerations is a matter of discretion for the court.  Stepping back and looking at the overall impact of the factors found to be relevant, the court may decide that certain factors carry such weight that a departure from equality is called for.  The decision is fact-specific and discretionary.  But where there is a departure, the court should explain its basis since the articulation of reasons provides a useful check on the fairness of the outcome.”

51.The applicable law on ancillary relief is found in section 7 of MPPO, Cap 192,

“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.”

52.An order for property transfer order or a sale of property is governed by sections 6 and 6A of the MPPO, Cap 192:

“6. (1) On granting a decree of divorce, a decree of nullity of marriage or a decree of judicial separation, or at any time thereafter (whether in the case of a decree of divorce or of nullity of marriage, before or after the decree is made absolute), the court may, subject to the provisions of sections 10 and 25(1), make any one or more of the following orders, that is to say-

(a) an order that a party to the marriage shall transfer to the other party, to any child of the family or to such person as may be specified in the order for the benefit of such a child such property as may be so specified, being property to which the first-mentioned party is entitled, either in possession or reversion;

(b) …

(c) …

(d) …

(e) an order for the sale of such property as may be specified in the order, being property in which or in the proceeds of sale of which either or both of the parties to the marriage has or have a beneficial interest, either in possession or reversion, and for use of proceeds of such sale…

Step 1 : Identification of assets

53.The parties’ stance on matrimonial assets are particularised as follows:

	Asset	Husband	Wife
1	One private vehicle, Mercedes-Benz CLS 350	Agree	Agree
2	Various luxurious watches including Chopard, Rolex and Piaget	Agree	Disagree
3	A property in Ching Wah Court	Agree	Agree
4	A property in Sorrento	Agree	Agree
5	Two car parking spaces in Sorrento (“Carpark No. 4X and Carpark No. 7X”);	Agree	Agree
6	10 % share of a flat in Hong Kong Garden.	Agree	Disagree

54.The husband discovered wife has transferred a total sum of HK$5,139.768 to third parties. He further alleged the wife has hidden assets. The breakdown of the sum are as follows:

(a)  HK$1,931,947 transferred to CC, the wife’s brother ;

(b)  HK$887,172 transferred to LKP, the wife’s uncle;

(c)  HK$200,000 transferred to CY, the wife’s sister;

(d)  HK$487,388 transferred to LML, the wife’s mother;

(e)  HK$150,000 transferred to CSL, the wife’s friend; and

(f)  HK$1,483,261 withdrawal from the wife’s bank account for unknown purpose.

Hidden asset (a): HK$1,931,947 transferred to CC, the wife’s brother

55.According to the husband’s narrative affirmation, the husband claimed the wife has paid HK$1,941,043 to CC:-

(a)  HK$429,395 through transfer from HSBC account on 19 September 2012;

(b)  HK$1,012,327 through transfer from HSBC account on 11 October 2012;

(c)  RMB300,000 (approximately HK$369,321) in cash on 21 December 2012; and

(d)  HK$130,000 through withdrawal by cheque on 14January 2013.

56.The wife replied in the affirmations  that the transfer were partial repayments of the loans advanced from CC in sum of HK$3,509,668:-

(a)  a debt of HK$1,128,668 she borrowed from CC on 30October 2008;

(b)  a debt of HK$1,131,000 she borrowed from CC on 30October 2008;

(c)  a debt of HK$500,000 she borrowed from CC on 27March 2009; and

(d)  a debt of HK$750,000 she borrowed from CC on 23October 2009.

57.The wife provided an acknowledgement signed by CC dated 27 December 2013 to prove the existence of the alleged debts and repayments. First, HK$1,128,668, a notice of transaction indicating HK$1,128,668 was transferred from a bank account held by Long Shing Company to DC Company[12]. Secondly, HK$1,131,000, the wife provided a telegraphic transfer application form of a bank dated 30 October 2008[13]. The payer was one Madam Wang instead of CC. Thirdly, there were two cashier orders in the amount of HK$500,000 and HK$ 750,000 respectively dated 27 March 2009 and 23 October 2009[14].

58.The husband disagreed they were genuine loans. The husband said there was no evidence to prove such transfer came from CC, including the sum of HK$1,131,000 which was transferred to DC Company.  The husband challenged the cashier orders were not deposited into the company account of DC Company.  

59.The husband raised doubts on the debt repayment, he submitted the evidence was insufficient to prove the alleged loans were duly repaid. The wife had only provided 2 HSBC transaction advices respectively dated 19 September 2012 and 11 October 2012 to show the sum HK$429,395 and HK$1,012,327 were transferred from her 888 account to HK Tong Seng TL, a third party bank account with HSBC[15]. There is no evidence to prove that the recipient of the payment was CC.

60.The wife explained Madam Wang was CC’s wife. The husband had once borrowed money from CC to keep DC Company running as well. The wife said, at that time, DC Company was in financial difficulty, her main concern was to seek funds to keep DC Company solvent. CC is her brother, the funds were transferred to DC Company in a relatively casual manner. She further explained, HK Tong Seng TL was CC’s client, the wife’s transfer of sum to HK Tong Seng TL was acted on the instructions of CC as repayment of debt.  

61.I accept the wife’s evidence that CC had advanced loans to her or DC Company. At that time, the divorce proceedings have not yet started in 2008. At that time, she was the only person to run DC Company in Hong Kong, she has tried her best endeavour to secure loans. I do not expect the wife would ask her creditors to provide full particulars of the loans when she was in need of funds. I find the dealings between the wife and CC hereinabove were loans made to DC Company.

62.With regard to the repayments, the wife could only account for two sums, being HK$429,395 and HK$1,012,327, the wife has no other evidence to support the transfers were repayments. Nevertheless, as I am in agreement with the wife that there were loans advanced by CC throughout the years, the amount of transfer by the wife is far less than the loans. In an ancillary relief, the Court shall not embark on a minute, costly and futile retrospective investigation of the parties’ assets, I found the alleged transfers were repayment of loans to CC. On this part, the husband’s allegation failed, the wife has no hidden asset in this part.

Hidden asset (b): HK$894,800 transferred to LKP, the wife’s uncle

63.According to the husband’s narrative affirmation, the husband claimed that she has transferred HK$894,800 to LKP which are particularized as follows:

(a)  USD10,000 (approximately HK$78,000) by cash deposit to LKP’s BEA account on 25 February 2011;

(b)  USD38,000 (approximately HK$296,400) through telegraphic transfer to LKP’s Bank of America account no.2832767665 (LKP’s Account) on 7 February 2013;

(c)  EUR39,000 (approximately HK$372,200 through telegraphic transfer to LKP’s Account on 7 February 2013;

(d)  USD6,000 (approximately HK$46,800) in cash on 6 November 2013;

(e)  USD1,500 (approximately HK$11,700) in cash on 12 November 2013;

(f)  USD7,500 (approximately HK$58,500) in cash on 24 December 2013; and

(g)  USD4,000 (approximately HK$31,200) in cash on 28 December 2013.

64.The wife claimed that the repayment was partial settlement of personal debt in sum of HK$1,728,211:-

(a)  a debt of HK$480,000 she borrowed from LKP on 11 April 2007;

(b)  a debt of HK$500,000 she borrowed from LKP on 28 July 2008;

(c)  a debt of HK$373,811 she borrowed from LKP on 17 May 2010; and

(d)  a debt of USD48,000 (approximately HK$374,400 from LKP on 22 May 2010.

65.The wife produced acknowledgement signed by LKP dated 30 December 2013 to prove the existence of such debts and repayments[16]. The wife only exhibited 3 HSBC cashier orders respectively dated 11 April 2007, 28 July 2008 and 17 May 2010 to prove the existence of the HK$480,000, HK$500,000 and HK$373,811 debts[17]. The husband argued those cashier orders did not indicate they were purchased by LKP and had been deposited to the DC Company account. Save and except 2 HSBC telegraphic transfer and transfer application forms both dated 7 February 2013[18], the wife has no other evidence to prove the transfers were alleged debt repayment made to LKP.

66.The wife explained, for same reason that she has sought funds from her maternal family to keep DC Company solvent. I maintain the same view that at time when the wife was in need of funds, I do not expect her to ask for prove of source of funds at that particular time. The wife explained LKP has been residing in the United States, sometimes she repaid him in cash because he had so requested. I also note from the amount of funds transferred to LKP, they are relatively minute as compared to CC. In an ancillary relief hearing, the Court shall not embark on a minute, costly and futile retrospective investigation of the parties’ assets, I found the alleged transfers were repayment of loans to LKP.  I do not find the wife has transferred the alleged sum of HK$894,800 to LKP for the purpose of concealing matrimonial asset.

67.Nevertheless, during the end of cross examination, the wife testified LKP would not call for repayment of outstanding loans if she was unable to repay. On this point, I accept the husband’s submissions to the extent that the wife was not required to repay the outstanding loans owed to LKP, the outstanding loans as claimed by the wife would not form her  liabilities.

Hidden asset (c): HK$200,000 transferred to CY, the wife’s younger sister

68.The wife deposed in her narrative affirmation that she has  paid HK$200,000 in cash to CY on 17 December 2013[19] in settlement of a personal debt of the same amount for an on behalf of DC Company[20].

69.The husband argued, the wife could not produce evidence  HK$200,000 was transferred from CY’s account to DC Company. The wife also failed to explain the reason why she has repaid CY in cash. The wife has only produced an acknowledgement signed by CY dated 4 February 2014 and 2 Bank of China customer’s credit advices dated December 2009[21]. The husband said the wife has failed to discharge her duty to make full and frank disclosure to ensure that the Court has sufficient information on her assets. The Court should draw adverse inference against the wife. 

70.During cross examination, the wife explained, at that time, CY was residing in Canada. She repaid the sum to her elder sister CSL who was working in the mainland and then CSL will transfer the sum to CY in Canada.

71.Firstly, I have difficulty in understanding the flow of money from CY to the wife. The wife failed to give evidence on how the alleged HK$200,000 loan was advanced and thus the reason why the wife has chosen a less straightforward way to repay the loan to CY. Although she has provided two cash deposit receipts to evidence the alleged loan, I find the evidence on the cash dealings with CY is unclear. On this part, I reject the wife’s evidence that the transfer of HK$200,000 cash was repayment of the alleged loan and I find the wife was in her possession of HK$200,000 being hidden asset of the matrimonial asset.

Hidden Asset (d): HK$487,388 transferred to LML, the wife’s mother

72.According to the wife’s narrative affirmation, on 3 July 2012, she has paid HK$487,388 to LML by transferring the same from her BOC account to LML’s City Commercial Bank account through an agent company called Hong Kong Ka Shing Trading Limited[22]. The wife said such payment was made for repaying a debt of RMB400,000 (approximately HK$487,388) she borrowed from LML on 20 January 2006[23].

73.Apart from a memo signed by the wife dated 20 January 2006[24], the wife could not produce evidence on the existence of the debt. During cross examination, the wife could not explain why she made the alleged repayment 6 years after the alleged loan was advanced.

74.On balance, I accept the husband’s evidence that the wife has in her possession of HK$487,388 being hidden asset.

Hidden Asset (e): HK$150,000 transferred to CSL, the wife’s friend

75.According to the wife’s narrative affirmation, she claimed she has paid HK$150,000 in cash to CSL on 22 July 2012 for the purpose of repaying a debt of HK$150,000 she borrowed in cash on 5 March 2011. The wife has only produced a written note dated 5 March 2011[25] and a repayment confirmation dated 22 July 2012[26] as evidence of the existence of the alleged loan and repayment.

76.During cross examination, the wife said neither was it inconvenient nor unusual to her to borrow and repay money by cash. CSL has requested her to do this way. On this point, I find the dealings between the wife and CSL were suspicious.    

77.I agree with the husband that the wife has no evidence to explain the withdrawal of a significant amount of money. I find the wife has in her possession of HK$150,000 being hidden asset.  

Hidden Asset (f) : unexplained withdrawal of a total of HK$1,291,741[27] from the wife’s 888 account

78.The husband claimed, according to the bank statements of 888 account, the wife withdrew a total of HK$3,220,851 from 12 July 2012 to 12 January 2013[28]. In wife’s answer to husband’s questionnaire (petitioner’s questionnaire) filed on 11 January 2017.  Apart from the wife’s answer that (i) HK$487,388 was repayment to LML and (ii) HK$1,441,722 was repayment to CC, the wife could not recall and account for the reason of withdrawal of the remaining sum, i.e.HK$1,291,741.

79.The husband further revised his claim on hidden asset by subtracting two further sums of RMB300,000 (estimated around HK$380,000) and HK$130,000, the final sum for unexplained withdrawal, was reduced to HK$781,714[29].

80.The wife could not explain in her evidence of the unexplained withdrawals. I am of the view that the unexplained withdrawal should also be in the wife’s possession as hidden asset.  

The Mercedes Benz

81.The husband said he cannot recall whether the vehicle was purchased as his birthday present. He remembered on an unknown day, the wife sent him a blank form for signature. The husband signed without looking at the details. The husband claimed the wife had sold the vehicle after he has signed on the blank form. The vehicle was sold and the proceeds in sum of HK$230,000 was in the wife’s possession. The husband alleged the proceeds was kept by the wife.

82.The wife said she could not recall when the vehicle was sold, she did not want to disclose the name of her friend who has introduced her the purchaser. It is indisputable that the vehicle was sold and the wife have received the proceeds. The wife testified, she sold the vehicle because of repayment of personal debts. She repaid HK$80,000 in cash to LSY and HK$150,000 to CSL.

83.I cannot see the wife could give evidence on the flow of the proceeds. It is very difficult to connect the proceeds from the sale of the vehicle with repayment of personal loan in cash. The wife has admitted she has concealed the person who has promote the sale. The wife’s evidence on this part should be rejected. I am of the view the sum of HK$230,000 was in the possession of the wife as hidden asset.  

Luxury watches

84.The husband testified he has bought quite a number of watches, including two Rolex 369 watches, one in black and one in pink; one Rolex submariner in red and blue and one Chopard watch. He entrusted the wife to keep all his luxury watches because he did acquire them as collectables, not for daily use. The husband could not remember when he had last seen those watches. He did not know where the wife has kept them.

85.The wife denied she was in possession of the watches, she said it was the husband who have kept them. This is the classic situation with bare assertion and bare denial. The husband has the burden to prove his allegation which I do not find his evidence could achieve.

The value of matrimonial asset

86.In conclusion, the aggregate matrimonial assets are as follows:

(i)  Carpark No.4X in Sorrento valued no less than at HK$2,200,000;

(ii)  cash in bank in sum of $11,711.54 with the wife’s BOC account and $49,735.58 in her 888 account. i.e. total: HK$61,447.12;

(iii)  transferred amount HK$100,000 to be set aside against LYS (the 2^nd intervener);

(iv)  hidden asset transferred to CY in sum of HK$200,000;

(v)  hidden asset transferred to CSL in sum of HK$150,000;

(vi)  hidden asset transferred to LML in sum of HK$487,388;

(vii)  hidden asset of unexplained transfer from the wife’s 888 account in sum of HK$781,714;

(viii)  proceeds from the sale of the Mercedes benz in sum of HK$230,000.

87.The aggregate value of the matrimonial asset should be (i) No.44 carpark space; (ii) available assets in bank and (iii) added back assets and hidden assets (HK$61,447.12 + HK$100,000 + HK$200,000 + HK$150,000 + HK$487,388 + HK$781,714 + HK$230,000) = HK$2,010,549.12.

Step II – Assessing parties’ financial needs

Section 7(1)(a) Income, earning capacity and other financial resources

88.At time of trial, the husband and wife were 54 and 60 years old respectively. They had a long marriage for 27 years. The husband and wife enjoy good health. No evidence on serious illness of either party was noted. Both the husband and wife contributed to the welfare of the family, i.e. the footwear business. The husband was responsible for the sales and management while the wife was responsible for administration, management, accounts and financial matters in both DC Company and P Company.  Both of them took part in the running of the footwear business.

89.At time of trial, both the husband and wife were unemployed without other income source. Prior to the establishment of the footwear business, the husband was a clerk whereas the wife was a quality checker, they do not possess other special skills other than experience in running the footwear business. The matrimonial assets were accrued during the marriage from the profit of the footwear business.

90.Both the wife and husband dispute they have equal earning capacity. The husband said although he was the CEO of DC Company, he was responsible for sales and marketing in the mainland. He entrusted the wife with the administration and accounts in the Hong Kong office. The husband alleged the wife has kept all money of the footwear business and he was only able to obtain “a monthly allowance” of HK$12,000 per month.

91.The wife disagreed, the husband failed to contribute the daily expenses of the family, she was responsible to pay all their household expenses in the matrimonial home.

92.I accept the wife’s submission that the husband’s involvement was not as minimal as he has claimed. The husband attempted to distance himself from the role of a decision maker of the footwear business. It is unbelievable, the husband as the CEO of DC Company, he has no idea of the capital of DC Company and blamed the wife has appropriated all capital and proceeds. I do not see what the husband has claimed was the real situation. As a CEO, it would be unbelievable that the husband was only managed to obtain HK$12,000 for his personal use per month. It would be equally ridiculous that the entertainment expenses would be paid from his salary.

93.The husband’s evidence does not support his saying. On his admission that he was a signatory of the DC company’s cheques, he agreed he was empowered to sign and cash cheques for funds to pay his daily expenses.  He was the one to sign the audit reports. He was the one to decide whether to forgive Mr Cheng, who has misappropriated the funds from DC company. He was also the one to determine whether to close down DC Company when the footwear business was making a loss.

94.The husband further admitted in evidence that he has other business dealings, he was capable to enter into agency contract or joint ventures with other business partners in the mainland. In comparison, after the footwear business has closed down, the wife was merely living on the rental income from Carpark No. 44 in Sorrento. On balance, the husband is more capable to have other income source.

95.I reject the husband’s submission he has a passive role in DC Company. I find both the husband and wife were the mastermind of the DC Company. The husband has relatively higher earning capacity and potentially higher income than the wife as he could have sourced other business opportunities in the mainland.  

Section 7(1)(b) The parties’ needs & obligations

96.The only income source of the wife is the rental income from the Carpark No. 4X in Sorrento. She stated in her Form E filed on 1 December 2016 the rental income of the same was of HK$3,600. The wife submitted the available resources are insufficient to satisfy the parties’ needs. She has a monthly expenses of HK$13,200 already.

97.The husband said his monthly expenses is HK$4,800, including all items save costs of his accommodation. He is now residing in a premise provided by his friend at no costs. The husband claimed his monthly expenses will increase if he had to move back to Hong Kong.

98.It is not in dispute that the footwear business was at loss since 2006. To save the business, the husband and the wife injected funds to the business by raising personal loans. I accept this is the main reason both of them had incurred debts. I note the husband has stated in his Form E filed on 1 December 2016 with a total of HK$1.13 million liabilities. The husband updated his liabilities in his narrative affirmation filed on 26 May 2017 to a sum of HK$750,000 being personal loan from his brother. He further claimed he owned to his personal owned to his friend around HK$100,000.  The wife claimed she was indebted to CC in sum of HK$2,067,946, she repaid RMB300,000 on 21 December 2012 and HK$130,000 on 14 January 2013; she was also indebted to LKP in sum of HK$832,750. The wife admitted during cross examination, LKP did not actively go after her for repayment. She admitted there was no agreement on how to repay these alleged family loans, LKP would not call for repayment if she had no means to repay. The situation is similar with CC, the wife’s brother. There was no clear repayment schedules, no evidence from the wife to state when CC will call for repayment of the outstanding loans.

99.Unlike loans from banks and financial institutions, loans made between family members and friends might be informal. It is not surprising they came without records. As I have mentioned earlier, at time when the wife borrowed money to save DC Company, she would not have expected the either the casher application forms, receipts or other evidence of loan or repayments would be subject to this matrimonial litigation. The husband raised the issue that the wife has not made full and frank disclosure on the documents. The husband asked the Court to draw adverse inference against the wife. I accept, in part, the wife’s explanation that she has borrowed and repaid money from individuals came without supporting documents.

100.In fact, the husband himself had failed to disclose his bank statements of an account opened with Bank of China; the agency contract as claimed and two insurance policy with Sun Life Insurance. The husband, who has been working in the mainland for most of the time, he had in fact failed to disclose bank accounts both in Hong Kong and mainland. He merely claimed monthly expenses of HK$4,800 per month, there is little and almost no documentary evidence at trial to state his financial status.

101.The husband focused on raising allegation against the wife on non-disclosure of documents, be it the wife has no application for specific discovery against the husband, the husband has only disclosed limited documents on his financial status. In comparison, the wife has had tried her best endeavour to disclose voluminous documents in light of her financial status and the money flow throughout the years. The husband claimed he was in charge of the sales department in mainland, I fail to see he has involved in repayment of the debts of the DC company, but rather, the wife has raised personal loans (which led to the sale of the property in Sorrento by mortgagee bank) to repay DC Company’s creditors.

102.Apart from some items which I have decided above in respect of section 17 application, save and except HK$100,000 transferred to LSY (2^nd intervener), I am satisfied the wife could explain, to some extent, the whereabouts of the money, mostly to repay the debts of the DC company.

103.On balance, although I could not classify the husband’s liabilities as fabrication, his account on the personal liabilities are uncertain. Whilst the wife testified, although she was still indebted to LKP, she was not required to repay if she was unable to do so. LKP is the wife’s uncle. The wife did not mention about the outstanding loans owed to CC.  All the outstanding loans do not have a timeline to repay. It is in doubt whether LKP or CC will ask the wife for repayment. Premised on this reason, I find both the wife and the husband have nil liabilities for the purpose of this ancillary hearing.  

Section 7(1)(c) standard of living during marriage; Section 7(1)(d) & 7(1)(e) Age of each party, duration of marriage and physical and mental disability of either parties

104.Both the husband and the wife took no issue on the standard of living during marriage. I shall refer to the background of the parties as above.

Section 7(1)(f) Contribution made by each party to the welfare of the family

105.The husband only testified he has been living on loans and financial assistance from his friends and family since cessation of the footwear business. It is indisputable that he could not have contributed to the family expenses of both the wife and the daughter.

106.The wife sustained her living by her savings and rental payment of Carpark No. 4X in Sorrento.

Steps 3, 4 & 5: Deciding to apply the sharing principle and considering whether there are good reasons for departing from equal division and the outcome of the ancillary relief application

107.The matrimonial assets determined are (i) Carpark No. 4X in Sorrento, which is valued no less than HK$2.2 million and (ii) HK$2,010,549.12. I take into account the contributions of both the husband and the wife throughout the marriage: the husband was in charge of the footwear business in mainland whereas the wife was responsible for the management and accounting in the Hong Kong. The profits of the footwear business were the main income source of the family. Regrettably, the footwear business did not do well and had ceased operation on 31 May 2013, both the husband and the wife has largely contributed funds to keep the business operating. Both of them has borrowed substantial amount of money from family members and friends. In particular, the wife, has put great effort to save the business by incurring personal debts. The property in Sorrento was sold by the mortgagee bank.

108.Both the husband and the wife have sustained a long marriage for 27 years, both participated in their business together. The rental income of HK$3,600 per month of Carpark No. 4X could not have met their needs. Both the husband and wife are unemployed but the husband has a higher earning capacity. In light of the above findings and to achieve fairness, I have no good reason to depart from the equality principle defined in LKW v. DD.

109.Periodic maintenance to be provided by either party is not an option. I am driven to the conclusion that a clean break is preferable and the only fair and reasonable manner would be an order that the matrimonial assets as identified to be shared equally between the husband and wife.

Costs

110.The husband has succeeded in part in the section 17 application, and in part of claiming hidden asset of the wife. Neither the husband nor the wife has achieved their open proposals. The husband had failed in obtaining a judgment that the matrimonial asset be determined be over HK$10 million, but only succeeded in less than half. I see it fit to order the wife to pay 50% of the husband’s costs in both in the section 17 application and ancillary relief proceedings, including all costs reserved, to be taxed if not agreed.

Conclusion

111.With the foregoing reasons, I give the following orders:

(i)  The wife (the respondent) do sell Carpark No. 4X in Sorrento and the proceeds of the sale, less all costs and disbursements,  be shared between the husband (the petitioner) and wife (the respondent) equally.

(ii)  The wife (the respondent) do pay the husband (the petitioner) a lump sum in amount of (HK$2,010,549.12 / 2) HK$1,005,274.56 within 56 days from the date of this judgment.

(iii)  There be a costs order nisi, that the wife (the respondent) do pay 50% of the husband’s (petitioner’s) costs of the notice of section 17 application filed on 1 December 2014, including all costs reserved, to be taxed if not agreed.

(iv)  There be a costs order nisi, that the wife (the respondent) do pay 50% of the husband’s (petitioner’s) costs of the ancillary relief, including all costs reserved, to be taxed if not agreed.

(v)  The above costs order nisi shall be made absolute in absence of application to vary by way of inter parte summons together with supporting affirmation within 14 days from the date of this judgment.

(vi)  Both the husband’s (petitioner’s) and the wife’s (respondent’s) costs be taxed in accordance with the Legal Aid Regulations.

Mr KH Mak of Messrs. Kevin Ng & Co., appeared for the petitioner

Mr BC Chow of Messrs. B.C. Chow & Co., appeared for the respondent

1^st, 2^nd and 3^rd Interveners acting in person and did not appear