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FCMC 10499 / 2018
[2019] HKFC 279
IN THE DISTRICT COURT OF THE
HONG KONG SPECIAL ADMINISTRATIVE REGION
MATRIMONIAL CAUSES NO. 10499 OF 2018
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| BETWEEN |
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V, RHM |
Petitioner |
and |
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V, ES |
Respondent |
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also known as B, ES |
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| Before: |
Her Honour Judge Sharon D. Melloy in Chambers (Not open to public) |
| Dates of Trial: |
22 and 23 January and 20 and 21 May 2019 |
| Date of closing submissions: |
20 June 2019 |
| Date of replies: |
27 June 2019 (Petitioner), 16 July 2019 (Respondent) |
| Date of Judgment: |
1 November 2019 |
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JUDGMENT
(Crossley application)
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Introduction
1.This is a hearing to determine whether or not the Respondent wife can show cause as to why she should not be bound by the terms of a Consent Summons dated the 4 May 2017 (and filed in court on the 5 June 2017) and subsequently amended by an Amended Consent Summons dated the 16 October 2017. The Petitioner husband asks for an order in terms of the Amended Consent Summons. The wife for her part asks that both consent summonses be set aside. She then requests that further directions be given with respect to ancillary relief.
2.In essence it is the wife’s case that both the original and Amended Consent summonses are fundamentally unfair and that given the circumstances within the family at that time and generally, she should not be bound by their terms. In addition, she alleges a material lack of disclosure on the part of the husband and she says that she was not given detailed and appropriate legal advice prior to the signing of both summonses. Further, she accuses the husband’s lawyer of placing her inter alia, under undue psychological pressure at a time when she was also suffering from acute emotional stress. In her last affidavit dated the 20 July 2018 she summarizes her position as follows:
65. I believe that the settlement stipulated in the Consent Summonses is unfair and unreasonable to me and the Children and that I was pressurized to agree to the deal under enormous stress from my unique circumstances. In the circumstance I humbly ask this court to set aside the Consent Summonses filed on 5th June 2017 and 16th October 2017 respectively which are both unreasonable and unfair to me and the children, with cost be to me.
3.Given the very high standard of living enjoyed by the parties during the course of the marriage the wife also says that the Amended Consent Summons does not ensure a continuation of anything like the same standard of living going forward. There are also concerns that it does not appropriately provide for the children, particularly for the youngest child of the family, H, who will need intensive medical and other support for the rest of his life. This suggestion is vigorously opposed by the husband.
4.Issues were also raised during the hearing (although I accept that this did not form part of the original affidavit evidence) with respect to the drafting and the meaning of a number of the clauses in the Amended Consent Summons and ultimately its enforceability.
5.The husband for his part maintains that the agreements were freely entered into by both of the parties after extensive negotiations, which led to the original Consent Summons being signed and then certain terms being renegotiated and a further Amended Consent Summons being signed. He says that the parties wanted a friendly divorce and that they did not wish to spend a great deal of money on legal fees. He further says that the wife had received independent legal advice and that it was her free and informed choice to enter into the agreements as drafted. He says that the wife is a strong woman and that it is not possible to bully her or to place her under undue pressure as alleged. He accuses her of being fundamentally dishonest in the way in which she has presented her case, something that in turn she strongly denies.
The law
6.The law is not in dispute and both parties refer to many of the same cases in support of their respective positions, although the emphasis that is placed on those cases may differ to a degree. The central case from a Hong Kong perspective remains the Court of Final Appeals decision in SPH v SA (Forum and Marital Agreements) [2014] HKFLR 286. Paragraphs 33 - 35 of SPH v SA are relevant and bear some repetition. These paragraphs also cite with approval paragraphs 68 – 73 of England’s landmark decision Radmacher v Granatino:
33. In particular, an agreement would carry full weight only if each party had entered into it of his or her own free will, without undue influence or pressure, having all the information material to his or her decision to enter into the agreement and intending that it should be effective to govern the financial consequences of the marriage coming to an end; and the court should give effect to an agreement which was freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to the agreement. Enforcement of the agreement could be rendered unfair by the occurrence of contingencies unforeseen at the time of the agreement or where, in the circumstances prevailing at the time of separation, one partner would be left in a predicament of real need while the other enjoyed a sufficiency.
34. The particular matters which were stressed by the Supreme Court were these. The court when considering the grant of ancillary relief was not obliged to give effect to nuptial agreements―whether they were ante-nuptial or post-nuptial. The parties could not, by agreement, oust the jurisdiction of the court. The court must, however, give appropriate weight to such an agreement. But it was the court, and not any prior agreement between the parties, that would determine the appropriate ancillary relief when a marriage came to an end, for that principle was embodied in the legislation. [2], [7].
35. The Supreme Court said:
“68 If an ante-nuptial agreement, or indeed a post-nuptial agreement, is to carry full weight, both the husband and wife must enter into it of their own free will, without undue influence or pressure, and informed of its implications. …
69 … the Court of Appeal was correct in principle to ask whether there was any material lack of disclosure, information or advice. Sound legal advice is obviously desirable, for this will ensure that a party understands the implications of the agreement, and full disclosure of any assets owned by the other party may be necessary to ensure this. But if it is clear that a party is fully aware of the implications of an ante-nuptial agreement and indifferent to detailed particulars of the other party’s assets, there is no need to accord the agreement reduced weight because he or she is unaware of those particulars. What is important is that each party should have all the information that is material to his or her decision, and that each party should intend that the agreement should govern the financial consequences of the marriage coming to an end.
…
71 … The first question will be whether any of the standard vitiating factors: duress, fraud or misrepresentation, is present. Even if the agreement does not have contractual force, those factors will negate any effect the agreement might otherwise have. But unconscionable conduct such as undue pressure (falling short of duress) will also be likely to eliminate the weight to be attached to the agreement, and other unworthy conduct, such as exploitation of a dominant position to secure an unfair advantage, would reduce or eliminate it.
72 The court may take into account a party’s emotional state, and what pressures he or she was under to agree. But that again cannot be considered in isolation from what would have happened had he or she not been under those pressures. The circumstances of the parties at the time of the agreement will be relevant. Those will include such matters as their age and maturity, whether either or both had been married or been in long-term relationships before. For such couples their experience of previous relationships may explain the terms of the agreement, and may also show what they foresaw when they entered into the agreement. What may not be easily foreseeable for less mature couples may well be in contemplation of more mature couples. Another important factor may be whether the marriage would have gone ahead without an agreement, or without the terms which had been agreed. This may cut either way.
73 If the terms of the agreement are unfair from the start, this will reduce its weight, although this question will be subsumed in practice in the question of whether the agreement operates unfairly having regard to the circumstances prevailing at the time of the breakdown of the marriage.”
7.The Hong Kong Court of Final Appeal added at paragraph 39 and 40
The application of Radmacher v Granatino in Hong Kong
39. There have been signs of approval of Radmacher v Granatino in this court in LKW v DD [2010] HKEC 1727, (2010) 13 HKCFAR 537 (per Ribero PJ at [53], [105], obiter since the appeal did not concern an ante-nuptial agreement). In the view of this court, the principles enunciated in Radmacher v Granatino should also be regarded as the law in Hong Kong. In common with the UK Supreme Court, we see no reason for distinguishing between ante-nuptial agreements and separation agreements.
40. As we have said, the Hong Kong Court of Appeal has already accepted in L v C [2007] 3 HKLRD 819 that the old rule that agreements providing for future separation are contrary to public policy is obsolete, and we endorse its judgment. We agree with the UK Supreme Court that this should not be restricted to separation agreements. None of the supposed distinctions between them can any longer be supported, although we accept that there may be circumstances where it is appropriate to distinguish between an ante-nuptial and a separation agreement. As the UK Supreme Court said (at [61]) the circumstances surrounding the agreement may be very different dependent on the stage of the couple’s life together at which it is concluded, but it is not right to proceed on the premise that there will always be a significant difference between an ante-nuptial agreement and a separation agreement.
8.In addition, Mr Pilbrow S.C for the wife has relied heavily on the restatement of the law by Mostyn J in Kremen v Agrest (2012) 2 FLR. As one might expect this is a rather eloquent restatement, which bears some repetition. Beginning at paragraph 72 Mostyn J states as follows:
[72] In Radmacher (formerly Granatino) v Granatino [2010] UKSC 42, [2010] 3 FCR 583, [2011] 1 All ER 373 the Supreme Court gave definitive guidance as to the treatment of a nuptial contract in proceedings for ancillary relief following a domestic divorce. The guidance contained in the judgment of the majority delivered by Lord Phillips can be summarised as follows:
(i) The court should give effect to a nuptial agreement which is freely entered into by each party with a full appreciation of its implications unless in the circumstances prevailing it would not be fair to hold the parties to their agreement (para [75]).
(ii) In determining whether an agreement has been ‘freely entered into by each party with a full appreciation of its implications’ there is no absolute black and white rule for full disclosure or independent legal advice. Rather, the question is whether in the individual case there is a material lack of disclosure, information or advice. Each party must have all the information that is material to his or her decision that the agreement should govern the financial consequences of the marriage coming to an end. An absolute rule would only be necessary if the agreement were to be contractually binding, but this is not the case as there is a safety-net of (un)fairness (para [69]).
(iii) The presence of any of the standard vitiating factors of duress, fraud or misrepresentation will negate any effect the agreement might otherwise have (para [71]). Further, unconscionable conduct such as undue pressure (falling short of duress) will likely eliminate the weight to be attached to the agreement (ibid). Other unworthy conduct, such as exploitation of a dominant position to secure an unfair advantage, will reduce or eliminate the weight to be attached to the agreement (ibid). The court may take into account a party’s emotional state, and what pressures he or she was under to agree, as well as their age and maturity, and whether either or both had been married or been in long-term relationships before (para [72]). The court may take into account foreign elements to determine whether or not the parties intended their agreement to be effective (para [74]).
(iv) In determining whether ‘in the circumstances prevailing it would not be fair to hold the parties to their agreement’:
(a) The agreement cannot be allowed to prejudice the reasonable requirements of any children of the family (para [77]).
(b) Respect should be accorded to the decision of a married couple as to the manner in which their financial affairs should be regulated particularly where the agreement addresses existing circumstances and not merely the contingencies of an uncertain future (para [78]). This is likely to be so where the agreement seeks to protect pre-marital property (para [79]). By contrast it is less likely to be so where the agreement leaves in the hands of one spouse rather than the other the most part of a fortune which each spouse has played an equal role in their different ways in creating (para [80]). If the devotion of one partner to looking after the family and the home has left the other free to accumulate wealth, it is likely to be unfair to hold the parties to an agreement that entitles the latter to retain all that he or she has earned (para [81]).
(c) It is likely to be unfair to hold the parties to an agreement which leaves one spouse in a predicament of real need, while the other enjoys a sufficiency or more (para [81]). However, need may be interpreted as being that minimum amount required to keep a spouse from destitution. For example, if the claimant spouse had been incapacitated in the course of the marriage, so that he or she was incapable of earning a living, this might well justify, in the interests of fairness, not holding him or her to the full rigours of the ante-nuptial agreement (para [119]).”
[73] It seems to me that it will only be in an unusual case where it can be said that absent independent legal advice and full disclosure, a party can be taken to have freely entered into a marital agreement with a full appreciation of its implications. After all, almost every common law country that has legislated in this field has as a key pre-condition these requirements as well as a safety-net where the agreement is judged to be ‘unfair’ (e.g. British Columbia) or ‘unjust’ (e.g. New Zealand) or ‘unconscionable’ (e.g. Australia). It would surely have to be shown that the spouse, like Mr. Granatino, had a high degree of financial and legal sophistication in order to have a full appreciation of what legal rights he or she is signing away. Equally, it seems to me that there would have to be clear evidence of significant economic capacity on the part of the claimant spouse before the assessment of needs was suppressed to that minimal level imposed on Mr. Granatino. There would surely have to be an equivalent finding to that in para. 119 viz ‘on the evidence he is extremely able, and has added to his qualifications by pursuing a D Phil in biotechnology’.
9.Although I accept that the factual matrix in that case was very different from the situation here, nevertheless it seems to me that this restatement is helpful.
10.Further Mr Pilbrow has also referred to a checklist of questions that was referred to in the earlier case of K v K (Ancillary Relief: Prenuptial Agreement) (2003) 1 FLR 120. Rather like the checklist that is sometimes referred to in Children’s cases, it is accepted that this checklist is not in any way binding on the court, but that practitioners and judges alike may find it helpful when considering cases of this nature. The checklist states as follows:
(1) Did she [the wife] understand the agreement?
(2) Was she properly advised as to its terms?
(3) Did the husband put her under any pressure to sign it?
(4) Was there full disclosure?
(5) Was the wife under any other pressure?
(6) Did she willingly sign the agreement?
(7) Did the husband exploit a dominant position, either financially or otherwise?
(8) Was the agreement entered into in the knowledge that there would be a child?
(9) Has any unforeseen circumstance arisen since the agreement was made that would make it unjust to hold the parties to it?
(10) What does the agreement mean?
(11) Does the agreement preclude an order for periodical payments for the wife?
(12) Are there any grounds for concluding that an injustice would be done by holding the parties to the terms of the agreement?
(13) Is the agreement one of the circumstances of the case to be considered under s 25?
(14) Does the entry into the agreement constitute conduct which it would be inequitable to disregard under s 25(2)(g)?
(15) Would I [the judge] be breaking new ground by holding the wife to the capital terms of the agreement?
(16) Would it be unjust to hold the parties to the maintenance terms of the agreement?
11.As will be seen, I have not in this instance gone through these questions mechanically when considering the facts in this case, but I have referred to the checklist from time to time during the course of my deliberations and I have found it helpful.
12.Further, given that this is a Crossley hearing, reference should also be made to the case of Crossley v Crossley [2008] 1FLR 1467. As explained by Ms Rattigan for the Petitioner husband in her opening:
37. There has accordingly been a marked shift by the Courts towards granting due weight to agreements that are both procedurally and substantially fair as demonstrated by Crossley v Crossley [2008] 1 FLR 1467. In that case it was established that the Court has the power, subject to its case management powers, to direct that the usual requirements for Form E’s and questionnaires be dispensed with and a party be required to show cause as to why the nuptial agreement should not determine the outcome of the matter as the Court has followed in the present case. The present hearing is a Crossly hearing.
This is also accepted. Initially the parties only filed limited Form E’s, as is envisaged by the Crossley protocol. Subsequently it is the husband’s case that he provided a great deal more disclosure at the request of the wife. Nonetheless it remains the wife’s position that he has not made full and frank disclosure and that further information is needed before she can proceed.
The central issue
13.As indicated above then the central issue is whether or not the Respondent wife should be bound by both consent summonses and in particular the Amended Consent Summons dated the 16 October 2017. In coming to that decision reference should be made to the protocols identified in the case law set out above.
Background to the marriage
14.Both parties set out the background to the marriage in their respective submissions. Mr Pilbrow says inter alia as follows:
2. This Court is possibly aware of the history of this marriage as the matter has been before it on several occasions. In brief however:
(i) H is of Dutch origin but came to Hong Kong in 1991. He set up a clothing business by the name of FC Ltd (“F”) in 1993, in which he remains a 60% shareholder. This is his 3rd marriage and he has 2 children by those earlier marriages, who live in Paris and Milan respectively.
(ii) W was born in Australia of American parents. Having spent early years in Korea and Hong Kong, she moved to USA after her parents’ divorce. She returned to Hong Kong in 2002, when she started working for G (“G”).
(iii) Having met in 2002, the parties married in May 2004. According to W, the date of separation was in 2017. There are 3 children of the family namely R (14 years), L (12 years) and H ֹ(9 years).
(iv) H suffered an asthma attack in 2010, due to the caring hospital’s failure properly to treat him. As a result, H now … ” suffers from Global Developmental Delay from anoxic encephalopathy and cerebral endemic caused by severe asthma attack. He is non-verbal, still in diapers and has severe behavioural issues and life-threatening Aerophagia, which constitutes the need for the gastronomy tube and suffers 2-3 seizures per hour.” (W’s Form E [B2/694].)
Further, R has been disturbed by his parents’ divorce, leading to him requiring psychological assistance after he threatened suicide upon learning of this father's decision to separate.
3. … The parties initially moved to Switzerland in 2011 but returned briefly to Hong Kong in 2012 before moving to Phuket. In 2014, the family moved to Georgia, USA but in May 2015 returned to Switzerland, where W and the children still reside. All moves by the family have essentially been driven by H’s health. Between November 2016 and December 2017, H underwent multiple operations and hospitalizations as confirmed by the medical certificate given by the family’s doctor in Verbier Dr. Popescu Dutruit dated 10th January 2019. As a result W also suffered great stress over this period as confirmed by Dr Katerina Rozakis, clinical social worker in the clinical note dated 14 January 2019 (annexed marked “C”).
4. It is apparent from the evidence that H maintained the family in a luxurious standard of living of the highest degree, provided presumably by the success of F. In January 2017, H met and now lives in Hong Kong with a further lady and her daughter. A review of the expenses he claims in his Form E ([B2/680-682]) indicates that he continues to maintain the same standard of living.
15.These basic facts do not appear to be disputed, although it is the husband’s case that the wife unilaterally decided to move back to Switzerland from Georgia. He also remains of the view that the best option for H is for him to be cared for on a full time basis at a school called X in Roswell, Georgia, USA. He also maintains that the family have been living significantly beyond their means for a very long time. With that in mind it is of note that the husband is now aged 62 and that he has had some health issues of his own including some heart problems and throat cancer which is now in remission. The wife for her part is now 45 years of age. She also has some health issues which she believes to be stress induced.
16.In Ms Rattigan’s opening she explains in more depth some of the salient points leading up to the divorce, with particular reference to the parties’ finances, as follows:
14. In order to meet expenses that were no longer being met by income the Petitioner sold the former matrimonial home in Sai Kung, in October 2014 for HK$130 million. After paying off some HK$20 million in debt, HK$78 million (US$10 million) was transferred to Switzerland to fund the family’s high living expenses which had, as the Petitioner feared, become unsustainable.
15. In March 2015 the Respondent informed the Petitioner that she wanted a divorce. In February 2017, the Petitioner told the Respondent that he also wanted a divorce. The Respondent informed the Petitioner that she had retained Ms. S of Withers to act for her, the Petitioner retained Mr. G to represent him in the impending divorce proceedings. The Respondent also consulted lawyers in Switzerland. The parties began to negotiate with regard to trying to settle matters between them as amicably as possible. The Respondent had suggested mediation in Switzerland but this did not take place. Instead, the parties negotiated directly, with the involvement of lawyers on both sides.
16. One matter that was of great concern to the Petitioner was the fact that he had to pay high taxes in Switzerland as a result of holding a “Permit B” in order to live there when he was not in fact doing so. As part of their negotiations the parties, therefore, took advice in Switzerland so that the Respondent would be able to obtain her own permit to live there after the divorce.
17. On the advice of his lawyers the Petitioner filed the Petition for divorce in Hong Kong on 12th April 2017 [A1/1]. The Respondent who was represented by Withers in Hong Kong as well as her lawyers in Switzerland then filed a Form 4 Acknowledgment of Service on 2nd May 2017 stating that she intended to defend the case on the basis of forum non conveniens [A1/5-7].
18. The parties continued to negotiate the terms of their financial settlement after the Petition was filed. This culminated in an agreement being reached (the “Consent Agreement”) which was drafted as a Consent Summons and was duly signed by the Respondent on 4th May 2017. This was then filed at Court on 5th June 2017 [A1/12] (the delay being caused as the Petitioner was travelling). The Consent Agreement specifically records the Respondent’s consent to Hong Kong being the appropriate forum and jurisdiction, she had not instituted proceedings in Switzerland at any time prior to this. At the time of the Consent Summons being filed the Respondent was receiving legal advice from Withers in Hong Kong and from Vafadar Silviotti Zapelli in Switzerland.
19. After the Consent Summons was signed by the Respondent she filed a Notice to Act in Person on 29th May 2017 [A1/8].
20. In July 2017, the Respondent informed the Petitioner that, after having taken further tax advice in Switzerland, it would be more efficient for maintenance as agreed under the Consent Agreement to be paid by a lump sum.
21. This started a further course of negotiations between the Petitioner and Respondent whereby they agreed to amend the Consent Agreement as requested by the Respondent. Both parties continued to receive legal advice through this process.
22. On 16th October 2017 the Petitioner and Respondent signed an Amended Consent Summons (the “Amended Consent Agreement”) and this was filed at Court on 20th October 2017 [A1/24]. This provides for a financial settlement for the Respondent including property transfers and for hers and the Children’s maintenance as set out in the Petitioner’s 4th Affidavit, under the terms of the Amended Consent Summons the Respondent would receive 10% of the net proceeds of F if sold. It also provides for the Petitioner to pay for the Children’s insurance, health care, school fees and associate costs and to continue to cover all of H’s expenses over and above the agreed maintenance payments. Currently, the Petitioner pays approximately HK$452,000 per month towards the Children’s expenses which includes H’s ski therapy, regular therapy, insurance premia and carer salaries [B2/660-691].
23. Following the signing of the Amended Consent Agreement the Petitioner transferred a lump sum of CHF3 million (equivalent to HK$23.5 million) to the Respondent as agreed.
24. After the Amended Consent Summons was filed the Registrar came back to the parties to say that there was a problem with the Petition because the Children were overseas. He required an amendment to the Petition to state this. The amendment was duly made by OLN but the Respondent refused to agree without stating why.
25. Unfortunately, after having received the CHF3 million into her account, the Respondent then sought to resile from the Consent Agreements, she engaged new solicitors, Boase Cohen & Collins (“BCC”) to write to the Court on 23rd November 2017 asking that the Consent Summons at Court not to be made Orders. This letter came a day after OLN had written to the Registrar to ask that the Court made an Order in terms of the Consent Summons dated 17th October 2017 [A1/78].
26. The Petitioner was left with no alternative but to file a Summons seeking to have the Consent Summonses made Orders of Court after negotiations between the parties failed. After the Petitioner had filed his original Summons of 9th February 2018 [A1/135], he was shocked to find out that the Respondent then made an application for injunctions and extensive discovery against the Petitioner and F and also for interim maintenance for herself and the children in the Entremont Tribunal in Switzerland on 29th March 2018. She did so despite having received CHF3 million from the Petitioner for her and the Children pursuant to the Amended Consent Agreement. The Petitioner’s 3rd Affidavit sets out that he was not immediately served with these proceedings as rather than being sent to his lawyers, they were sent to the parties’ home in Switzerland where the Respondent lives. Further, the Respondent had not informed the Swiss Court that there are proceedings currently underway in Hong Kong.
27. After extremely expensive proceedings in Switzerland the Swiss Courts ruled in favour of the Petitioner and stated that matters should be dealt with by the Court in Hong Kong, … [A1/200].
28. The Court was informed at a hearing on 17th July 2018 that the Respondent intended to proceed in Hong Kong for final orders in relation to the divorce and the Children. She also stated that she was no longer going to agree to the divorce Petition as filed and agreed in the Consent Summons on the basis of 2 years separation as she wanted to argue the date of separation being later, no application had been made to file an answer out of time as would be required. In order not to waste further costs on this the Petitioner agreed to amend the Petition to be based on 1 year of separation (without prejudice to his position on the date of separation as agreed by the parties in the first Petition).
29. After the hearing on 17th July 2018 the Respondent changed solicitors and went back to Withers.
30. Having been told at the hearing on 17th July 2018 that the Respondent was agreeing to jurisdiction in Hong Kong, the Court was further informed at the hearing on 26th September 2018 by the Respondent’s Senior Counsel that the Respondent would be discontinuing the proceedings that she had brought in Switzerland.
31. Unfortunately, this was not the case, the Respondent has continued to pursue an appeal in Switzerland against the Court’s refusal to grant her interim financial relief in that jurisdiction (despite the fact that she was paid a considerable lump sum and the Petitioner continues to meet the majority of the expenses).
32. The Petitioner is very concerned about the Respondent’s litigation conduct and the hemorrhaging of funds that should be used for the family. He is extremely worried that despite the parties having reached an agreement on the children and financial arrangements the Petitioner seeks to resile from this at great cost to the family both financially and emotionally. As stated above there are no agreed long-term plans for H other than the fact that the Petitioner will pay for him, and since these proceedings have started the Respondent has created all manner of obstacles over the Petitioner having access with the Children. At the rate at which the Respondent is spending and given the extremely high legal costs there will simply be nothing left for the Children’s security.
17.As will be seen this version of events is not fully accepted by the wife. In particular, she does not accept that she received detailed legal advice before signing the consent summonses. She also reiterated in her affidavits and in the witness box, that it was her firm belief that Switzerland and not Hong Kong was the most appropriate forum to deal with the divorce, as that is where both she and the children have been living. Similar to the husband she maintains that she is contesting this application, primarily because she too is concerned about the financial security of the children post-divorce.
18.When asked in the witness box how he felt about the wife reneging on the Amended Consent summons after receiving the CHF3 million that he had sent to her in accordance with his undertaking in that agreement the husband said that:
How it makes me feel is I feel like I’m being tricked. I mean we talked for months about an agreement, we draw it up, we sign it. I wire the money to her account and I don’t know, maybe a few days later she reneges on the whole thing. So how does that make me feel? And then since then we have spent, I don't know, I think, if we add up everything I spent on lawyers, I’ll be close to or over a million US dollars and she must be saying, “For what?” “For what?” To -- that money should have been there for -- to pay for H and for the children and that money is gone now. So how can I plan anything? How can I be saying, “Okay, I’m doing this and this and this” while then all of a sudden all the cards change and I’m sitting there with a huge cost and almost no money left?
The issues
Introduction
19.In considering this application I have attempted to break the matter down as set out below. I will discuss the various aspects of the case under these heads.
Were the consent summonses entered into freely and with a full appreciation of their implications? In particular
i) Was there a material lack of disclosure? Did the wife receive independent legal advice?
ii) Was there any duress, or undue influence or pressure or any other form of unconscionable conduct undertaken by the husband or the husband’s lawyer against the wife?
iii) What was the wife’s emotional state at the time? Was she under any other form of pressure to agree to the consent summonses?
Would the circumstances prevailing at the time make it unfair to hold the parties to the consent summonses in any event? In particular
iv) Would the consent summonses potentially prejudice the reasonable requirements of the children, particularly H?
v) Do the consent summonses potentially leave the wife in a predicament of “real need”?
Did the parties appreciate the implications of the consent summonses? Were some of the clauses enforceable as drafted in any event?
Are there grounds for concluding that an injustice would be done by holding the wife to the terms of the consent summonses?
Discussion
Were the consent summonses entered into freely and with a full appreciation of their implications? In particular
i) Was there a material lack of disclosure? Did the wife receive independent legal advice?
20.These two things are interconnected and were hotly contested during the trial. It is the husband’s case that the wife was fully aware of the financial circumstances of the family, that she sat in on meetings at banks and other financial institutions and that she had access to all relevant financial documents. However, what became clear during the course of the trial and from the affidavits filed, is that the wife only had a very basic and limited understanding of the parties’ financial situation. Further it is not disputed that there had not been “full disclosure” prior to the negotiations taking place.
21.It seems that the wife did not have detailed information or documentary evidence pertaining to many aspects of the parties’ finances. In particular, the husband was cross examined with respect to the net proceeds of sale from the former matrimonial home. As indicated above the property was sold for HK$130 million in 2014. Of that sum HK$20 million was used to pay off some accumulated debt. The husband says that he then transferred US$10 million or say c HK$80 million to Switzerland and that these funds were settled in family trusts. He further says that all of this money is now “gone” and that the wife is fully aware of the circumstances surrounding the situation. This is an enormous amount of money to simply disappear and I have no doubt that further disclosure in this respect will be necessary. In addition, he was asked about the remaining HK$30 million odd. In answer he merely retorted that everything can be seen from his accounts. Time will tell if this is true or not. Similarly, the wife did not have any detailed information relating to the husband’s company, F or to another smaller company subsequently set up by the husband.
22.It also seems that the wife did not have copies of many bank and credit card statements. During her re-examination she confirmed that she did not have copies of the Hong Kong bank statements, even though these related to joint accounts or any of the credit card statements, although she had seen them when they were first received for payment. In addition, she said that of the Swiss bank account statements, she only had copies of what the husband had given her. It is of note that historically during the marriage, she would simply send in credit cards to the petitioners PA for payment. The husband acknowledged that the wife would generally spend between US$30,000 – US$40,000 per month on credit cards. He also accepted that this had been foolish and that he had never given the wife a budget or sought to curtail her credit card spending in any way, other than to complain about it. Both he and the wife acknowledged that she had only used the credit cards (i.e. a black Amex card, a Visa and a MasterCard) and that she did not have access to cash. In such circumstances I tend to accept that the wife had a fairly limited knowledge of the parties’ finances, especially in so far as their family expenses were concerned. She did know in broad terms about most of the visible assets, but not necessarily their values. The wife further explained that she realized in retrospect that she had only very limited information made available to her during the course of the negotiations, especially in so far as the family expenses were concerned and that in reality she was wholly unprepared for assessing the realistic needs of both herself and the children going forward. In her last affidavit dated the 20 July 2018 she reiterates this as follows:
21. The Petitioner stopped paying me any maintenance for myself and the children since the transfer of the CHF 3 million and stopped paying any bills. The CHF 3 million was supposed to be for the children’s maintenance only, not to cover other expenses. However I was left with all the bills and the lawyers’ expenses to pay which I had never done before. They were all used to be handled by the Petitioner’s secretary and paid by the Petitioner directly. After the transfer of the CHF 3 million I was left with bills of utilities of the two properties in Switzerland and all living expenses to pay. I realize that the CHF 3 million is certainly insufficient even for the children’s maintenance alone, not to mention with all the other expenses. In fact it has been running out fast. I feel cheated by the Petitioner as he was fully aware that the CHF 3 million is insufficient even for the children’s maintenance alone when he asked me the sign the Amended Consent Summons.
22. The CHF 3 million is, according to the Amended Consent Summons, for the children only. There is no maintenance provision for me in the Amended Consent Summons. As I need to look after the Children I cannot work. Without maintenance it is simply impossible for me to survive. I will have to sell our home in V and H’s apartment and live on the proceeds. Under the Amended Consent Summons I even had to pay the Petitioner half of the sale proceeds of the Chalet and in the meantime pay all the mortgages, tax and bills before the sale of the property! Even with the proceeds it is insufficient for me and the Children as we will still have to pay for accommodation.
23.It was put to the husband during the cross examination that the wife had no realistic idea of how much money she would need going forward to support both herself and the children. Mr. Pilbrow suggested that she would need approximately HK$250,000 in order to meet essential expenses under the Amended Consent summons. (The wife herself had put this at a slightly lower figure of CHF20,000 per month inclusive of CHF5,000 per month for herself). At the time of the first tranche of the trial in January 2019, I was informed that the wife had already spent between CHF1.5 – 1.8 million of the lump sum of CHF3 million, although it was the husband’s case that most of this had not been spent on the children.
24.It is true that the wife proceeded nonetheless to essentially negotiate her own agreement. She did so even though there had not been any disclosure and her lawyers, reputable firms in both Hong Kong and Switzerland, had told her that they could not properly advise her unless there was “full disclosure”. This aspect of the case was also challenged by the husband who basically said that this could not be so. In particular, he pointed to bills paid by him to the wife’s lawyers, which went far beyond the US$5,000 allowed for in the consent summons.
25.Ultimately however, I found the wife’s version of events on this point to be entirely credible. It seems to me unfathomable that a reputable family law firm would or could have behaved in any other way than as described. In such circumstances I accept that it would only have been possible for the law firms to provide the wife with very basic legal advice on the issue of ancillary relief, given that there had been practically no financial disclosure. Indeed, it is the wife’s evidence that she was told repeatedly that she would be entitled to 50% of the assets and maintenance for both herself and the children. I accept what she says in this respect.
26.Mr Pilbrow S.C summarized the situation from the wife’s perspective in his closing as follows:
(a) W has maintained throughout that she did not receive independent legal advice concerning the terms of the Amended Consent Summons. She confirms that she was informed of her right to take advice albeit the sum of US$5000 provided by the terms of the Amended Consent Summons suggest the offer to be limited. It is confirmed under her signature on the Amended Consent Summons that she acted in person. Messrs. Withers declined to countersign the first Consent Summons in the manner that H’s advisers did, indicating that they could not do so since W was acting contrary to their advice and they had not explained the terms of the Consent Summons to her.
(b) W was cross-examined at length concerning her claim to a lack of independent legal advice mainly on the basis of the charges rendered by Withers and W’s Swiss lawyers, which H met. Messrs. Withers came off the record when W filed a Notice the Act in Person on 25th May 2017. Messrs Boase Cohen & Collins did not come onto the record until 23rd November 2017. W’s Swiss lawyers came off the record on 27th April 2017 and were re-instructed in January 2018. Withers however issued bills in May, August and October 2017. W confirmed that she received advice from Withers after the signing of the first consent summons but it was in regard to what steps could be taken to set aside the Consent Summons, including seeking an opinion from Richard Todd Q.C. in that regard.
(c) The review of the terms of the Amended Consent Summons made below must surely suggest that no competent lawyer could have advised W. This, however, is also confirmed by W herself in contemporaneous correspondence with both H and his advisers:
(i) “there is no “ghost lawyer” .... E-mail W to OLN dated 13.9.17 (C3/1402)
(ii) “... my last communication with S was quite rude. She was not pleased that I did not take her advice. I now understand why! Had I known that you and R [the husband] would treat me this way and that this would turn into such a nightmare, I never would have let you pressure me into signing away my right to a lawyer.” E-mail W to H and OLN dated 14.9.17 (C311412)
(iii) … you pressured me into signing away my rights to a lawyer and now you are trying to pressure me into accepting something that in unacceptable. I have to finally seek advice …
Email W to OLN and H dated 6.10.17 - 10 days before Amended Consent Summons signed (C3/1423)
(vi) “... If you want to spend more on lawyers it will simply be deducted from what we have now”... email H to W dated 8.10.17 (C311436)
(v) “I have a decision to make and I have to consider the whole situation. I cannot be left in a mess. I was pressured into signing away my right to a lawyer and now I have to deal with totally unprofessional and ridiculous emails from G. This whole process has been a disaster.”
Email W to H dated 8th October 2017 (C3/1437)
(vi) “.... and now.... you will spent the money we have left on lawyers and at the end you will find out what you did and end up with nothing. Wake up, E!!!!” Email H to W 8.10.2017 (C3/1433)
(vii) “... Enough R. I have tried everything on my own to settle this with you on your terms. I acted on my own, not fully understanding everything with my situation .....”
Email W to H 8.10.17 (C3/1440)
It is clear from the above that up until the last minute before the signing of the Amended Consent Summons on 16th October 2017, both W and H were negotiating between themselves and W was doing so on her own, with H and his lawyer trying to make her feel she was being difficult and unrealistic with her requests. Indeed, W confirmed that she did not see the final draft of the Amended Consent Summons until they were before the Notaire in V to sign the same. The bill from W’s Swiss lawyers indicates that they ceased advising W in April 2017 prior to the signing of the 1st Consent Summons. It is apparent that both lawyers advised W that no agreement should be signed before full disclosure had been given.
I accept this to be the case. I also accept that this was an entirely appropriate stance for the wife’s lawyers to take in the circumstances.
ii) Was there any duress or undue influence or pressure or any other form of unconscionable conduct undertaken by the husband or the husband’s lawyers against the wife?
iii) What was the wife’s emotional state at the time? Was she under any other form of pressure to agree to the consent summonses?
27.I also accept that the wife was under extraordinary levels of stress and pressure at the time of the negotiations. It is of note that the first round also took place within a relatively short period of time (i.e. the petition was filed on the 12 April 2017 and the first consent summons was dated the 4 May 2017). Although the husband tries to paint a picture of a loveless and sexless relationship, which subsisted merely for the sake of the children and particularly for H, there can be no doubt that the parties certainly held themselves out to be a close and loving couple until shortly before the wife discovered evidence of the husband’s infidelity in March 2017. There is no doubt that this discovery was a considerable shock both to her and the elder children.
28.Further it is clear that H was extremely unwell during this period and that he needed the wife’s constant attention. In April 2017 he began to have frequent brain seizures and between April – June 2017 he was hospitalized 6 times. As referred to above the original consent summons was signed on the 4 May 2017.
29.In addition the wife had to cope with issues pertaining to the elder child R, her own health issues and her father’s ill health. The husband says that the wife is a strong woman and that she cannot be forced to do anything that she does not wish to do. Indeed, he suggests that the negotiations were driven by her. The wife for her part says that she felt under tremendous pressure to sign both consent summonses and that she just wanted the situation over. In her affidavit dated the 16 April 2018 she further states as follows:
75. The finalized draft amended consent summons was only done and e-mail to R and the Notaire’s office to print and shown to me at the Notaire’s office in Switzerland by R. I had not seen the final changes made by G until then. R came to Switzerland for only a few days just for this and arranged for the Second Consent Summons to be signed by both himself and I. We went to the notary public together on 16th October 2017. I only got a sight of the finalized draft amended consent summons on the day and had no opportunity to consider. The notary public read the draft and told me in the presence of R whether I would agree to this as there is no maintenance for me. I had no one to go over the changes with me. I signed under immense pressure influence and duress, which the Notaire will confirm. She kept asking R where was my lawyer through all of this and was I sure I wanted to sign. I did not feel that I have a choice. I just wanted it to be over.
76. I now regretted entering into the agreement too quickly without thinking it through or asking for any financial disclosure. However at the time I just wanted to resolve this as soon as possible to avoid hefty legal bills and stress from the proceedings so that I can just focus on the Children. Although I did not think his proposed maintenance for the Children was sufficient I agreed to it.
I accept her version of events.
30.This situation was also made worse by what can only be described as the highly unprofessional conduct of the husband’s lawyer – Mr G, who the wife knew and respected. As indicated above she had previously worked with him on a charity – a children’s welfare scheme, for a short period of time, when she first returned to Hong Kong. Some of the e-mails written by Mr O to the wife were, with respect, quite extraordinary. There is a bullying tone to them and I accept that on occasion there was both undue pressure exerted by him and an attempt to exploit his dominant position against her more obvious weaker one. This sort of behaviour by a seasoned professional is clearly unacceptable. It is a matter for the wife whether she chooses to take this matter further.
Would the circumstances prevailing at the time make it unfair to hold the parties to the consent summonses in any event? In particular
iv) Would the consent summonses potentially prejudice the reasonable requirements of the children, particularly H?
v) Do the consent summonses potentially leave the wife in a predicament of “real need”?
31.The husband is firmly of the view that the consent summonses are ultimately fair, given that under their terms he continues to be responsible for most of the children’s expenses, which are considerable. He does not accept the suggestion that there is any risk at all to the children, or indeed the wife, who he accuses of being greedy. In his 4th affidavit of the 14 August 2018 he comments as follows:
4. Despite the wording of the Amended Consent Summons stating that the lump sum payment of CHF3 million is intended only for the children’s maintenance, I wish to clarify that the lump sum payment to E [the wife] was calculated on the basis of:-
(1) 10 years of E’s monthly maintenance of CHF10,000 and CHF10,000 per month for R, L and H’s maintenance in the total amount of CHF2.4million (i.e. CHF20,000×12months×10years = CHF2.4 million); plus
(2) CHF600,000 being E’s 50% share in the Phuket property.
…
5. On top of the lump sum payment, it would was also agreed that E would receive the following: -
| a) |
50% beneficial interest in Phuket Villa P, E’s father’s residence which is currently legally held myself |
CHF500,000 |
| b) |
50% of sale proceeds of the V Chalet |
CHF4,375,000 |
| c) |
H’s Apartment in V to be transferred to E |
CHF1,400,000 |
| d) |
Boat in Switzerland |
CHF285,000 |
| e) |
Porsche 911 GTS 2016 |
CHF150,000 |
| f) |
Porsche Cayenne S 2014 |
CHF40,000 |
| g) |
Jeep 2016 |
CHF30,000 |
| h) |
10% of the net sale proceeds of Frontline |
Unknown at this stage |
| |
Total |
CHF6,780,000 (equivalent to HK$52,884,000) |
6. Therefore, under the terms of the Amended Consent Summons, E is in fact receiving a total sum of CHF9,780,000, which is equivalent to HK$76,284,000 from me which does not include the personal assets she already has in her possession which I estimate to be in the region of HK$6 million. I am advised and verily believe that this represents a very generous settlement with E receiving over 50% of the marital assets and the settlement covers her reasonable needs generously interpreted.
32.There are a number of difficulties with this. Firstly, there is a concern that the wife may be left in a situation of real need, comparatively speaking, in the event that she is unable to fund the expenses that she is deemed responsible for under the Amended Consent summons from the designated amount of CHF3 million. There is also a concern that she may not be able to support herself or to contribute towards the children’s expenses after these funds are spent given that she only has a limited earning capacity. Although the wife indicated during the trial that she hopes to return to work in due course, whether that is really feasible remains to be seen. In particular, she is keen to work for an organisation called M and/or to help to establish a neurodevelopment centre in Switzerland. It is also not clear how much she might realistically earn even if this opportunity became a reality, which currently seems doubtful. The husband has suggested that she could sell some assets, although as will be seen there may be some difficulty with this given the way in which the agreement has been drafted. It is of note that many of the assets referred to above are illiquid in any event.
Did the parties appreciate the implications of the consent summonses? Were some of the clauses enforceable as drafted in any event?
33.During the trial it became increasingly clear that many of the terms of the consent summons were unclear and arguably unenforceable as drawn. Neither party seemed to know what was meant by many of them. Although this is not accepted by the husband in his closing submissions, it seems to me that given the evidence it is not really possible to draw any other conclusion. Ms Rattigan tried to suggest that the parties themselves knew what was meant by some of the terms, but this was not borne out by much of the oral evidence. Mr Pilbrow summarizes the position in his closing submission. I do not intend to go through all of the clauses that cause difficulty, but I have picked out the following three examples which give some idea of the magnitude of the problem:
Clause J
J. AND UPON the Petitioner undertaking to the Respondent and to the Court that he shall be responsible for the payment of the Children of the Family’s education and health care and associated costs up to and including university and he shall pay directly to the invoicing parties. All children expenses are to be pre-approved by the Petitioner before his direct payment. In relation to H, all therapist, special schooling, domestic helpers and anything he needs in his life will be paid by the Petitioner. All damages, if any, successfully claimed under the current lawsuit in relation to H will go towards reimbursement of expenses paid so far in relation to H by the Petitioner and any balance will be offset towards H’s future requirements.
34.This is an undertaking by the husband. On the one hand he promises to be responsible for all of the essential expenses for the children and on the other he says that this must be done with his pre-approval. He also says that he will pay for “anything that H needs in life”. It is not clear what this means or how it might be interpreted going forward. I am told that there have already been difficulties with respect to some of the payments for H’s expenses, although this does seem to be limited to expenses related to what one might term non-essential items.
Recital L
L. AND UPON the Petitioner and Respondent agreeing, acknowledging and confirming to each other that the property under the Petitioner’s sole name situated at Route du Golf XX, XXXX Verbier, Switzerland (“Verbier Chalet”) shall be transferred to the Respondent’s sole name remain in the Petitioner’s sole name and she shall be responsible for the mortgage. The and Respondent shall be responsible for half of the running costs of the Verbier Chalet upon transfer to her name. Upon the Petitioner’s Permit B being cancelled, the Respondent shall be responsible for the property taxes for the Verbier Chalet. upon the Petitioner’s Permit B being cacelled. The Verbier shall be sold within and no later than three (3) years from the date of this Consent Summons, with both the Petitioner and the Respondent having the option by agreement, to lengthen or shorten the time for sale of the Verbier Chalet. The sales proceeds from the Verbier Chalet shall be split equally (50/50) between the Petitioner and the Respondent after payment of any tax, mortgage or other expenses. From the sales proceeds from the Verbier Chalet, the Respondent shall receive half the mortgage payments made on behalf of the Petitioner. save that the Petitioner shall pay property taxes on the Verbier Chalet for the first year. In the event the Petitioner wishes to sell the Verbier Chalet after 2 years hereof, the Respondent shall receive half the net sale proceeds after payment of any tax, mortgage or other expenses. The Respondent shall have reasonable access to the Verbier Chalet upon reasonable notice to the Petitioner, and the Verbier Chalet can be rented out by the Peitioner during a certain period of the year to help cover costs.
35.This is an agreement between the parties. It is not clear when this property is to be sold, or how either party could force a sale. In addition, if this is largely the only capital that will be available to the wife, it is not clear if 50% of the net proceeds of sale, will be sufficient to rehouse both her and the children in the future. There is also a concern that the wife will not be able to meet all of the expenses listed i.e. the mortgage and the other outgoings on the property once it has been transferred to her.
Recitals M, R and BB
M. AND UPON the Petitioner and Respondent agreeing, acknowledging and confirming to each other that the property under the Petitioner’s sol name situated at Villa QXX/XX Moo X Layan Estate Cherngtalay Sub-district, Talang District, Phuket Province 8XXXX Thailand (“Phuket Villa Q”) shall remain at in the Petitioner’s sole name and the Children of the Family and the Respondent can have access to the Phuket Villa Q upon reasonable notice to the Petitioner.
…
R. AND UPON the Petitioner and Respondent agreeing, acknowledging and confirming to each other that in the Petitioner’s event of death, the Verbier Chalet, H’s Verbier apartment, the Phuket Villa Q, and the part owned by Respondent’s father’s Villa, Phuket Villa P in Phuket, shall be inherited by the Respondent to hold in trust for the Children of the Family, R, L and H and the Petitioner shall execute a Will to such effect.
…
BB. AND UPON the Petitioner undertaking to the Respondent that he shall make arrangements in his Will that should he pass away before the Respondent, the Respondent shall hold all the assets received by her in this Consent Summons in trust for the Children of the Family, R, L and H.
36.These are further agreements. There is much confusion surrounding their meaning and how they interface with each other. Mr Pilbrow explains it thus in his closing:
(d) Recital M, Rand BB .... Phuket Villa Q is to be retained by H, but subject, apparently, to the children’s right to have access to it. By recital R, however, H undertakes that Villa Q will, upon his death, be inherited by W to hold in trust for the children. To secure such inheritance, H undertakes to execute a will to that effect! When this was put to H in cross examination (A2/495.129), it became clear that he did not understand / appreciate the restrictions that were to be imposed by the terms of the Amended Consent Summons on his ability to deal freely with Villa Q. As far as W is concerned, she clearly did not appreciate that H’s offer to execute a will did not carry the security she envisaged! Recital BB just adds to the confusion .... By this recital, H undertakes to make arrangements in his will that, should he die before W, she shall hold all assets received by ‘her’ in this Consent Summons in trust for the children. Firstly, it clearly does not make sense for H to deal with assets received by W in his will... .one must presume that the word “her” in recital BB is intended to read “him”. This error is repeated in recital CC where the reference to “all assets received by him” should read “her”.
If these recitals are to be read as presumably intended, it being clear that neither party knowing which of them is going to die first, both would seem to be limited from in any manner dealing with any of the assets received by him/her under the terms of the Amended Consent Summons, as they may have to be held in trust for the children! One wonders whether “all assets received by W” includes the sum of US$3m mentioned in Recital GG and order 2, albeit W is purportedly to receive the same as “child maintenance”. Again what assets of H are to be included within the terminology of Recital BB? Is Villa Q an asset that H has “received” by this Consent Summons? Villa Q is already in his name - indeed what assets is H “to receive” by this Consent Summons, which H is, by will, under Recital BB, to pass to W in trust for the children? Perhaps that is the reason why Recital R is included to ensure that villa Q is inherited by W in trust for the children....
To add further to the confusion arising from Recital R, there is mention that “in the event of H’s death, the part owned by W’s father’s Villa, Phuket Villa P, shall be inherited by W in trust for the children”. I presume the word “Villa” appearing after the words “Respondent’s father’s” is otiose.... No part can have been owned by W’s father’s villa! If that is correct, I am unable to see what right H has to attempt to dispose by will of that part of Villa P as is owned by W’s father. The part of Villa P as is beneficially owned by H, on the other hand, “shall” (by Recital P above) be transferred to W in trust for the children ... but only “in the event of H’s death”. Certainly W understood that H’s beneficial share was to be transferred to her, albeit in trust for the children rather than awaiting the death of H. Indeed, in the knowledge that, sadly, W’s father has now died, one wonders how this might affect the arguments that have apparently already surfaced between the heirs to his estate, if the Amended Consent Summons were to become an Order of this Court.
37.Other difficulties exist with respect to the other Recitals. It was also a matter of concern that the husband believed that order 5 – i.e. that there be liberty to apply as to the implementation of the terms of the order, meant that the court could intervene and make good the obvious difficulties with respect to the way in which the agreement had been drafted. This was clarified during the trial.
38.In conclusion it seems to me that this was a very poorly drafted document and one that would be almost impossible to enforce as it stands. Further it was clear that neither party fully understood the potential implications of many parts of it.
Are there any grounds for concluding that an injustice would be done by holding the wife to the terms of the consent summonses?
39.It does not seem to me that the Amended consent summons was entered into freely or with a full appreciation of its implications. In particular, it is clear that there had been a material lack of disclosure, especially with respect to the family expenses and that the wife did not receive full legal advice before signing either document. I specifically accept that she did not receive advice on the consent summonses themselves. Further, although I would accept that the pressure that she was subjected to did not amount to duress, nevertheless she was placed under inappropriate pressure during the negotiation process. I am also conscious of the fact that the wife’s emotional state at the time was a cause for some concern given H’s situation at the time including the fact that he was in and out of hospital on a regular basis, especially during the period that the first consent summons was negotiated and signed. Although the husband complains that the wife has used H’s condition unfairly, it nevertheless seems to me that this is a material factor to be taken into account. Ultimately I am also not convinced that the agreements are fair, although I am cognizant of the huge amount of money that has been spent on legal costs to date and the fact that if the husband comes up to proof on many aspects of the disclosure, that both parties will need to radically alter their lifestyles going forward.
Conclusion
40.Having considered all of the above, it is ordered that both the original consent summons dated the 4 May 2017 and the Amended Consent summons dated the 16 October 2017 be set aside. As rightly pointed out by Mr Pilbrow, this is not the sort of case that was anticipated in Crossley, where truncated Form E’s were filed and the parties proceeded to bypass many of the normal rules relating to disclosure etc. Here it will be necessary for the parties to make full and frank disclosure of their financial situation and this is likely to go beyond the disclosure filed to date. Form E’s were filed in August 2018. Thus in the first instance it is further ordered that updated Form E’s shall be filed and exchanged within the next 42 days. There shall also be a further First Appointment on the 7 February 2020 at 9:30 am. I shall not order in the first instance that the parties do personally attend this hearing, although this will clearly become necessary as the case develops.
Costs
41.I can see no reason why costs shall not follow the event in the normal way. Thus I shall make an order nisi to be made absolute in 28 days’ time that the Petitioner husband shall pay the Respondent wife’s costs on a party and party basis to be taxed if not agreed. There shall be certificate for counsel.
|
( Sharon D MELLOY )
District Judge |
Ms. Mairead Rattigan instructed by Oldham Li & Nie for the Petitioner
Mr. David Pilbrow S.C instructed by Withers for the Respondent
|