Wm v. Cnk
Read the full judgment text of FCMP 19/2012 on BabelCite. This FCMP judgment was delivered on 20 September 2019.
1. This is a hearing of the parties’ respective summons for variation of the maintenance payable under the consent order dated 17 July 2013 (“the Consent Order”). The Applicant (“the father”) asks for the undertaking to purchase a property for the use of the child (“M”) to be discharged and the maintenance payable to be reduced, whilst the Respondent (“the mother”) asks for the maintenance payable to be increased.
Cites 2 cases
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FCMP 19/2012 [2019] HKFC 246 IN THE DISTRICT COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION MISCELLANEOUS PROCEEDINGS NO. 19 OF 2012 ------------------------
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----------------------- J U D G M E N T ------------------------ 1.This is a hearing of the parties’ respective summons for variation of the maintenance payable under the consent order dated 17 July 2013 (“the Consent Order”). The Applicant (“the father”) asks for the undertaking to purchase a property for the use of the child (“M”) to be discharged and the maintenance payable to be reduced, whilst the Respondent (“the mother”) asks for the maintenance payable to be increased. Background 2.The father is a German national. He was and still is a Chief Executive Officer (“CEO”) of a listed company in Germany. The mother is a local Chinese. The parties met in Hong Kong sometime in 2006 and thereafter developed a romantic relationship. 3.M was born in 2008 and is now aged 11. M is currently living with the mother in Hong Kong and being a Year 7 student of an English Foundation School (“EFS”). 4.The parties’ relationship came to an end towards 2011/2012, leading to the present proceedings during which a settlement on M’s maintenance was reached as evidenced by the Consent Order before HH Judge Bruno Chan on 17 July 2013 (A/1-5). The relevant and essential terms of the settlement were as follows:
5.It is not disputed that the father has failed to honour the full terms of the agreement in at least 2 ways. Firstly, he unilaterally reduced the monthly maintenance to $32,000 (as opposed to $38,000) since February 2015. Secondly, he failed to purchase a property for the mother and M’s occupation by the end of 2017. 6.Instead, the father took out a summons on 9 November 2016 (A/6) seeking to be released from his undertaking to purchase a property for the mother and M’s occupation and also a downward variation of the maintenance payable for M. In his supporting affirmation, the father asked for the monthly maintenance to be reduced to $23,000 (B/6, §14). After the conclusion of the evidence, counsel for the father asked for the sum to be further reduced to $13,000 together with the father’s undertakings in respect of M’s educational costs (§88 of counsel’s Closing Submission). 7.The parties had attempted negotiation for a settlement but unfortunately failed. On 29 March 2018, the mother took out her summons for an upward variation of M’s maintenance from $38,000 to $41,300 until June 2024, and $41,900 until M reaches 18 or finishes secondary school education. 8.The mother had at the same time issued a judgment summons (“JS”) for the outstanding arrears amounting to a sum of about $288,695 being the difference in monthly maintenance the father had unilaterally reduced since February 2015 up to March 2018. The JS is now adjourned sine die pending the determination of the present 2 summonses. Issues 9.It is to be noted that it is now the father’s case that his ability to pay is no longer a primary issue. In counsel’s Closing Submission, it was stated at §86 that:
10.Therefore, it is my view that the issues to be decided now are:
The Law 11.The law giving the court’s jurisdiction to vary a maintenance order in respect of a minor born outside wedlock is found in section 10 (4) of the Guardianship of Minors Ordinance, Cap. 13 (“GMO”):
12.On how to exercise the court’s discretion, I agree with counsel that helpful guidance can be found from similar cases brought under section 11 of the Matrimonial Proceedings and Property Ordinance, Cap. 192 (“MPPO”) for children born within wedlock together with the relevant case laws. 13.In the case of AEM v. VFM[1], Cheung JA has explained the modern approach in dealing with such an application at paras 14.4-8 of the Judgment:
14.As to the weight to be attached to the original order, Tang VP (as he then was) said in the case of HCTT v. TYYC [2008] 5 HKC 86 at paras 15-16:
15.I shall bear the above principles in mind when I come to consider the facts of this case. The Father’s Case and Financial Circumstances 16.It is the father’s case that his ability to pay is no longer a primary issue. By this, I take it to mean that he has no difficulty in paying the maintenance as claimed by the mother for M. What remains disputed is whether the amount claimed is reasonable and whether they should be allowed in full. 17.Despite the father’s concessions, I still find it necessary to go into a brief discussion on his financial positions so that the final decisions on M’s maintenance could be made in proper context. 18.The father is a German national now aged 54. He is currently the Chief Executive Officer of a listed company in Germany earning an average monthly income of about HK$376,963 (B/119). He is also in possession of the following assets and liabilities (B/118):
19.In his evidence, the father has testified on his financial responsibilities towards his ex-wife and child from his first marriage; and also his responsibilities towards his current wife and child, the marriage of which was entered into shortly after his separation from the mother. But as the father’s ability to pay is not a major issue here, I will not venture into a detailed discussion of those financial responsibilities as they will not have a profound impact on the father’s abilities to satisfy the reasonable needs of M. 20.It is the father’s case that the mother has also entered into a marriage shortly after the Consent Order was made. Her husband (“Mr. Lo”) works in a disciplinary force and is being provided with married quarters as part of his remuneration package. As the housing needs of both the mother and M have now been catered for, the need for the provision of housing by the father is no longer there. Therefore, the father asks for the withdrawal of his previous undertaking in purchasing a property for the use of M and the mother. 21.The father also submits that as the mother’s marriage (in the year of 2014) happened so shortly after their settlement on financial provisions (in 2013), it is reasonable to assume that when the parties were negotiating for and finally reached a settlement in 2013, the marriage was well within her contemplation and therefore should have been disclosed to him during negotiation. In short, the father is alleging that the mother has breached her duty for full and frank disclosure when negotiating for the settlement. 22.Furthermore, it is also the father’s case that many of the expenses as claimed on behalf of M are without evidential support or unreasonable in amount or nature. He is now willing to give an undertaking to pay for M’s educational expenses together with payment of a monthly sum of HK$13,000 towards the reasonable maintenance of M, the breakdown of which could be found at Annex B of counsel’s Closing Submission dated 19 September 2018. 23.The father also asks for the variation to be backdated to the date of the mother’s marriage (on 8 May 2014) and claims for the return of a sum of $598,320 from her. In the event that the court does not accede to the request for backdating to the mother’s marriage, he asks for backdating from his summons, i.e. 9 November 2016 in the sum of $231,840. The Mother’s Case and Her Financial Circumstances 24.The mother is now aged 40. On 8 May 2014, she married Mr. Lo who is a civil servant working in a disciplinary force in Hong Kong. Together, they have another child born in 2016. Therefore, the family of 4 (the mother, Mr. Lo, M and the new born child), together with a domestic helper are now living in government quarters. 25.In order to care for M, and her new born child, the mother could not return to full time employment. According to her, she is now working as a part time English tutor earning about $2,400 per month in 2016/17 which has recently increased to about $4,200. 26.In the mother’s Form E (B/96-97), she has listed out M’s current monthly expenses (as on 29 March 2018) but I also note that some of those items have been revised in her latest (6th) Affirmation (B/68-69) as follows (the figures in bracket are sums claimed before revision):
27.It is the mother’s further case that the school fees of M will be increased to $9,390 in 2018-19 (which should have already happened by the time of this judgment). Upon M’s entry into secondary education in 2019-2020, there will be a further increase of 38% for Year 7 school fees and a further increase of about 6-7% for Year 8 to Year 13. In addition, the mother asks for the father to provide security to his payments (§2 of her summons, A/27) and raises objection to the release of the father’s undertaking to provide housing for M. 28.During the hearing, sometime has been spent on whether the mother has fully utilised her earning capacity by returning to the labour market on a full time basis. I presume that line of cross examination was based on the fact that the mother had once undertaken in the Consent Order that after her return to full time employment, she would also contribute to the expenses of M in the monthly sum of $10,000. I think it is now unrealistic to expect the mother to fulfil this undertaking in view of the development since the Consent Order. I am glad to see that counsel has sensibly not made any submissions in this area in both his Opening and Closing Submissions and I will say no more in that regard. Father’s Undertaking to provide Housing 29.An important part of the father’s application is for the withdrawal of his undertaking to purchase a property before the end of 2017 for the exclusive occupation of the mother and M. It is not disputed that such undertaking was breached by the father as such a property has never been purchased, nor provided to the mother and M for their occupation. It is the father’s case that the purpose of such undertaking was to provide both the mother and M a proper accommodation. As their accommodation has now been properly provided for by virtue of Mr. Lo’s employment, there is no reason why the father should not be released from that undertaking. 30.The mother objects by saying that the accommodation offered by Mr. Lo cannot be said to be stable. Putting aside the facts that Mr. Lo’s employment may be subject to changes in future and staff quarters are not a guarantee, M is facing an additional difficulty in that as an illegitimate child, he may be evicted therefrom as he is not treated as a family member of Mr. Lo from the prospective of [the government]. My Views 31.It is quite clear from the mother’s evidence that she and Mr. Lo knew each other when they were still young. Shortly after the breakdown of her relationship with the father in 2011, the mother’s relationship with Mr. Lo has become close and intimate. Mr. Lo even helped her to sign for a tenancy because according to her, she as a single mother and without stable employment was in great difficulty in securing a rental accommodation. However, there is no evidence on when the mother and Mr. Lo decided to form a new family by marriage. It is true to say that the period between the settlement and the mother’s marriage was relatively short, but I am not prepared, without any further evidence in this respect, to jump to the conclusion that the mother must have form the intention to marry Mr. Lo at the time of the settlement and thus failed to fulfil her duty for full and frank disclosure. 32.As to whether the father should be released from the undertaking to buy a property for the use of M and the mother, one has to bear in mind that the purpose of such undertaking is to satisfy the reasonable housing needs of M, and ancillary to that the housing needs of the mother as well. The reality is that M is now living with the mother in a new family in staff quarters provided by the employer of Mr. Lo. There is no evidence to suggest that Mr. Lo is not treating M as a child of the new family. In her evidence, the mother has hinted that M may not be allowed to stay in the government quarters but apart from that bare assertion, I see no concrete evidence in this regard. Under these circumstances, it is not realistic to expect the mother and M to move out from the new family even if the father should have honoured his undertaking in purchasing a flat now. 33.After hearing the parties’ evidence in this regard, I am satisfied that the reasonable accommodation needs of M has now been catered for and this significant change of circumstance would justify the withdrawal of the father’s undertaking in respect of the purchase of a flat for M and the mother’s accommodation. Reasonable Needs of M Educational Costs 34.The father is willing to give an undertaking to pay for M’s educational costs until he completes his secondary education as billed by his school from time to time. He further maintains his undertaking under paragraph (A) (3)(a) of the Consent Order concerning with M’s tertiary education. 35.In view of the increasing costs of M’s education in the years to come, an undertaking in this regard seems to be a better option so as to avoid any future adjustment. I am satisfied that M’s educational costs can be secured by a proper undertaking from the father. Life Insurance of the Father 36.The father also confirms his previous undertaking under paragraph (A)(4) of the Consent Order in respect of his life insurance. In paragraph 4 of Annex A to counsel’s Closing Submission, the father has reiterated his undertaking with more details. Counsel has also enclosed the insurance’s annual statement provided by HSBC in Annex C to his Closing Submission. I am satisfied with the father’s undertaking in this regard. Other Needs 37.In Annex B of counsel’s Closing Submission, Mr. Egerton has set out a table setting out the claims of the mother as opposed to the proposals of the father. But as that table has not incorporated the mother’s revised claims in her 6th Affirmation, I would further revise the table for the ease of comparison:
38.The items in italics are those in dispute and they are now reproduced hereunder for ease of reference:
39.It is regrettable to note that a vast majority of the mother’s claims are disputed in one way or the other. Some differences are really minor involving only a few hundred dollars (for the item of uniform, the difference is merely $100). Having said that, I note from Mr. Egerton’s Closing Submission that counsel has reasonably not made submissions on each and every disputed items, especially those very minor ones. By this, I take that the father has decided not to put up any serious challenge to those very minor items, although that does not mean that he agrees to each and every one of them. Therefore, when I come to the discussion on the reasonableness of the mother’s claims, I will concentrate on Section E of counsel’s Closing Submission which set out the father’s objections to the quantum of M’s monthly reasonable needs. 40.Before I proceed to discuss the more significant disputed items, there are some general comments that I want to make here. It is apparent that many of counsel’s attacks on the mother’s claims centred on the fact that she had not produced all the receipts in support. I think that is true for many of those challenges as raised by the father. Although I must bear in mind that the general burden of proof rests squarely on the mother, one must not lose sight of the fact that many of those daily expenses are not of very great amount of which one would always keep a receipt. I also note that after the mother’s quotation of M’s various expenses at her Form E (B/97) on 28 March 2018, there has never been any request from the father for further and better particulars or for the production of the actual receipts for verification. Moreover, many of those expenses are not static and by nature will change from to time to time. That means those figures are necessarily estimated averages and therefore, their reasonableness has to be assessed in that particular light. Extra tuition fees 41.The mother claims for $3,200 per month for M’s extra tuition fees. The father proposes a figure of $800. 42.It is true to say that the mother did not produce receipts amounting to the sum of $3,200. But everybody knows that in Hong Kong, students taking extra tuitions are extremely common. I have no doubt that M must have taken and may be still taking those extra tuition classes, or at least some of them. It is also common that students may attend extra tuition for different subjects at different times. Therefore, the tuition fees claimed under this item must be an estimated average figure, instead of an actual reimbursement figure. As far as that figure is concerned, $3,200 per month does not seem to be unreasonable despite the lack of receipts and I will therefore allow them in full. Transport to School (including School Bus) 43.The mother claims for $1,200 per month. The father proposes $500. 44.School bus receipts are much more straight forward and there is no reason why those receipts could not be produced. Since the father is challenging the quantum and the burden on proving such quantum rests squarely on the mother, I tend to accept the father’s contention that a monthly sum of $500 should be allowed instead of the $1,200 as claimed. Medical/Dental 45.The mother claims for $1,500 per month for M’s medical and dental expenses. The father proposes $1,000. 46.In cross examination, it was put to the mother that the receipts produced only amount to $4,324 in total, averaging about $864.80 per month. Again, I accept that the amount claimed is just an estimated average figure and the claim of $1,500 per month for a minor’s medical/dental expenses does not seem to me to be unreasonable. I will allow them in full. Extra-Curricular Activities 47.The mother claims for $4,400 per month for M’s extra-curricular activities. The father proposes $1,000. 48.It is the father’s case that the mother could only produce an application form to “ABC Cooking Studio” with $2,900 worth of cooking lessons thereon together with $400 admission fee being billed. The father complains that there were not enough details on how often M would go to those cooking lessons and how long would $2,900 last. He further complains that no receipts from the mother were produced. 49.The mother explained that the extra-curricular activities would include swimming, tennis and chess classes, which were not unusual activities for M given his educational background. 50.I accept that for a minor like M, the attendance in various extra-curricular activities is quite common. The nature and expenses on those activities are not static and will change from time to time. M might be attending activities like cooking, swimming, tennis or chess at the time of hearing, but by the time of this judgment, he might be attending other activities instead. As an estimated average figure, I do not find the sum of $4,400 being unreasonable. Entertainment/Presents 51.In her latest affirmation (B/68), the mother claimed for $3,130 as M’s expenses on entertainment and presents (only $2,510 in her Form E). The father proposes $1,000. 52.In her supporting affirmation, the mother was suggesting that M had to spend about $1,730 per month on movie. I agree that sounds a bit too much. I would reduce it to $1,000 (a deduction of $730) for movies. After such adjustment, I would allow $2,400 in this item ($3,130 - $730 = $2,400). Holidays 53.In her latest affirmation, the mother claimed for $2,500 per month as M’s holidays’ expenses (B/69), instead of her previous claim of $3,333 in Form E (B/97). The father proposes $1,000. 54.It is the father’s case that the receipts produced by the mother do not support the said amount of $3,333 (nor the lesser sum $2,500). For example, for the receipt in support of the Thailand trip, the sum quoted may have included expenses for other family members, including those of the domestic helper. 55.Mr. Li for the mother submits that M is a child with international background and with his advancing age, a yearly budget of $40,000 for holidays is not unreasonable. 56.I accept that the mother has not produced enough evidence to support an annual budget of $40,000 (nor the lesser budget of $30,000) for M’s holiday expenses. Doing the best as I could, I would say a monthly sum of $2,000 is about right, that is roughly about 1/3 of what the father is spending on his own holidays (B/121, the father’s Form E). Clothing/shoes 57.Although the mother claimed for $1,500 per month as M’s expenses on clothing and shoes in the Form E, I note that in her most updated evidence, (B/69), she has reduced it to $1,000 only. I would adopt this latest figure of $1,000 although Mr. Egerton said the father proposed $1,200. Lunches and Pocket Money 58.In the mother’s latest affirmation (B/69) she claimed for $8,900 per month as M’s lunches and pocket money, instead of her previous claim of $9,300 per month in the Form E (B/97). It is apparent that this amount would include all expenses on food, snacks and pocket money as there was not a separation claim for food in the Form E. 59.The father said that in some of the receipts produced, the expenses of other people must have been included. One obvious example was the receipt from Le Meridien Cyberport in which 2 bottles of wine were included. Obviously, these could not be M’s expenses. 60.Although there is some force in the father’s argument, I have to remind myself that this item would include the daily food consumption of a minor who is entering into his teens. It would be impossible for the mother to produce all the supermarket receipts and make a proper apportionment. Furthermore, food and lunches are only parts of this item and we also have to consider the pocket money to be given to M, which was $20 per day, or about $600 per month. I would expect this sum to be increased further upon M’s entry into secondary school. 61.The father proposes $3,200 which is a totally unrealistic figure. I would allow $8,100 per month ($7,500 for food and dining out, $600 for pocket money). In other words, a sum of $800 will be deducted from this item. Summaries of M’s reasonable expenses as allowed 62.Based on the above discussion, I would allow the followings as M’s reasonable monthly expenses:
63.For the ease of calculation, I would round up the sum to $29,000. It has to be noted that this sum of $29,000 is in addition to the father’s undertakings to pay the school fees of M and also the provision of a life insurance on the father with M being named as the beneficiary. Orders 64.Based on the above reasons, and subject to the undertakings of the father that:
Costs 65.The father succeeds in discharging the undertaking on the purchase of a flat for M, whilst the mother succeeds in achieving an upward variation of the maintenance payable by the father (although the father is currently paying $32,000 per month, that is inclusive of M’s school fees). It may not be easy to decide who the winner is concerning these 2 applications. 66.Be that as it may, I note that there is a vast disparity between the financial abilities of the parties. Furthermore, it was the father who has unilaterally breached all his undertakings and the orders on maintenance in the Consent Order without the prior approval of the court. Those actions should not be condoned. In order to show this court’s disapproval of those breaches, and after considering all the circumstances of this case, in particular, the vast disparity of the parties’ financial abilities and for the protection of M’s best interests (any requirement for the mother to pay costs or share part of the costs would effectively mean that those costs have to be paid out from M’s maintenance), I have decided to exercise my discretion in favour of the mother in awarding her costs in these 2 applications, including all costs reserved with certificate for counsel. This will be an order nisi to be made absolutely after the expiry of 14 days from the hand down of this judgment.
Representation: Mr. Robin Egerton, Barrister-at-law instructed by Messrs T.K. Tsui & Co., solicitors for the Applicant Mr. Felix Li, Barrister-at-law instructed by Messrs So Keung Yip & Sin, solicitors for the Respondent [1] [2008] HKFLR 106 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Cases cited in this judgment
Further hearings and rulings under FCMP 19/2012