Lau Chu v. May Lau Tang Su Ping

CACV000045/1989

Husband and wife - divorce - financial protection for respondent - petitioner's application to make decree nisi absolute - petitioner undertaking to comply with any order the Court may make for financial relief for respondent, coupled with undertakings severely restricting his right to deal with very substantial assets in the meantime - whether s.17A(4)(b) of Matrimonial Causes Ordinance satisfied.

BETWEEN

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Coram: Fuad, V.-P., Hunter & Macdougall, JJ.A.

Dates of hearing: 30 and 31 day 1989

Date of judgment handed down: 14 June 1989

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J U D G M E N T

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Fuad, V.-P.:

1. On 20 March 1989 Mayo J. made an order under s.17A(4) of the Matrimonial Causes Ordinance, Cap. 179 ("the MCO") granting the husband/petitioner leave to make absolute the decree nisi of divorce he had obtained although the requirements of s.174( 3 ) of the Ordinance had not been satisfied. The wife/respondent now appeals against that order which has stayed pending appeal.

2. The present controversy between the parties has a long history. They were married in 1964. The husband is now aged 54 and the wife is in her late 40's. They have a son and a daughter who have now grown up.

3. The husband left the matrimonial home in 1980 and has been living with another woman ever since then. On 3 November 1981 the wife filed a petition for judicial separation, coupled with an application for financial relief. She later applied for a lump sum order and for the transfer to her of certain property. The petition was not defended.

4. On 27 July 1982 Power J. (as he then was) pronounced a decree of judicial separation in the wife's favour and at the same time made an order based upon an agreement reached between the parties on 27 May 1982. This was an elaborate order which was expressed to be in full and final settlement of the parties' money and property claims against each other "under all relevant statutory provisions in Hong Kong."

5. I will not read the judge's order ("the Consent Order") embodying the agreement which is to be found between pages 23 and 31 of the appeal bundle.

6. The parties had very substantial interests in a number of private companies which were affected by the Consent Order. What happened afterwards in relation to some of these interests is fully explained in an affidavit sworn on 1 December 1987 by Mr. Niall Giblin, a solicitor then acting for the husband. It appears that by April 1984 three of the privates companies owned and controlled by the wife (she had always owned and controlled one of these companies while her husband's share in the joint ownership of the other two companies had been transferred to her in pursuance of the Consent Order) were in financial difficulties and had combined debts in the region of $30.6 million.

7. The husband, though not obliged to do so under the Consent Order, agreed to help his wife out of her difficulties and a scheme was drawn up. Broadly speaking, a private company which had previously been owned and controlled by the wife, but which had paased to the husband under the Consent Order, was used to rescue the wife. As a result, that company took over one of the wife's companies in trouble, together with its debts, and the other two companies owned by the wife became almost debt free. In addition, the wife was discharged from the obligations of a number of onerous guarantees.

8. But the husband's assistance did not end there. The Consent Order contained financial provision by the husband for the maintenance of the two children of the family until they attained their majority or ceased full-time education, and the husband was to continue for a specified period to pay premiums due on 4 life insurance policies of which the children were the beneficiaries. The husband met substantial expenses incurred in respect of the children beyond his obligations under the Consent Order.

9. As regards his wife, when it was decided that their daughter should study in U.S.A., in December 1985, a flat was bought in New York in the name of the wife with his help. The wife was to use the flat as her business address. The parties hoped that the establishment of a business there would eventually enable the wife to obtain "green card" which would later entitle the children, too, to live and work in the U.S.A.. The husband paid his wife a total of US$400,000 between 1982 and 1985 to further these plans. He paid her an additional US$174,444 for the maintenance etc. of the flat and for the legal and accountant's fees she had incurred in connection with her application for a "green card".

10. The husband also paid his wife various sums between 1984 and 1987 which he was not bound to pay under the Consent order in connection with certain property in Hong Kong; a total of about $570,000. He also estimates that he was entitled to rent for the years 1984-987 in respect of three Hong Kong properties, amounting to nearly $2 million, which he did not insist upon receiving.

11. Although the daughter of the family is now 24 years of age, and the son 19, the husband has undertaken to continue to provide financial support for the children, at the present rate, until they are fully independent.

12. I return to the history of these proceedings. On 25 March 1986 the husband filed a petition for divorce under s.11A(1)(e) of the MCO on the ground that the marriage had irretrievbly broken down, as evidenced by the fact that he and his wife had lived apart for a continuous period of 5 years immediately preceding the presentation of his petition. The petition was not defended and a decree nisi was duly pronounced in favour of the husband on 5 November 1986.

13. The wife filed an application for what I will call financial protection under s.17A(l) of the MCO on 25 October 1986. On 6 February 1987 she made an application for financial relief under s.4 of the      Matrimonial Proceedings and Property Ordinance, Cap.192 ("the MPPO").

14. The proceedings which had started in the District Court were transferred to the High Court on 11 March 1987. On 17 December 1987 Mayo J. acceeded to an application made by the husband to strike out the wife's application for financial relief under the MPPO. The wife appealed, and on 7 June 1988 this Court held that upon the true construction of s.4 of that Ordinance, a Court could not make an order on judicial separation which deprived it of its jurisdiction to entertain an application for ancillary relief after the subsequent pronouncement of a decree nisi of divorce. That decision, in which Kempster J.A. gave the leading judgment, has not been reported (Civil Appeal No.34 of 1988, 7th June 1988). The husband obtained leave to appeal against that decision to Her Majesty in Council on 21 July 1988 but, we are told, has since decided not to proceed with his intended appeal.

15. On 25 November 1988 the husband filed his affirmation of means. In it he deposes that he believed his total assets were worth approximately $175 million. In making his assessment he said that he had obtained the assistance of accountants, bankers and other professional advisers. He exhibited two schedules listing his assets and containing an estimate of the value of his shareholdings in various private companies.

16. The husband took out his summons under s.17A(4) of the MCO on 19 December 1988. In an affirmation filed on the same day the husband expressed his willingness to give any undertaking sought of him He invited the Court to refer particularly to the Consent Order dated 27 July 1982 and to consider what had happened since. He had complied with all his obligations under that Order. He had provided for his children far in excess of the obligations he had assumed. I mention here that under the Consent Order the parties were given joint custody of the children with care and control to the husband. He also draws attention to the way he assisted his wife when she got into financial difficulties beyond what was required of him by the Consent Order, and to the fact that she lives in a home in Repulse Bay owned by one of his companies. Paragraphs 5 and 6 of his affirmation are as follows :

"5. The Respondent and I have not lived together since the 12th January 1980. Since September 1980 I have been living with [Miss K] with whom I have lived continuously ever since. We are anxious to marry as soon as possible and it is our earnest wish to have children. However we both feel that it would be wrong for us to have a child before we are married. [Miss K] is now 38 years of age.

6. [Miss K] and I intend to emigrate to Canada before 1997. I have been informed by the Canadian Consulate in Hong Kong and I verily believe that once I have obtained a Decree Absolute of Divorce and have married [Miss K] there will be no difficulty in obtaining visas for us both to reside in Canada. My intention would be to establish a home for us in Canada at an early date. She would live there on a permanent basis whilst I would continue to live in Hong Kong in order to look after my business interest here, but I would travel to Canada regularly in order to be with her."

17. I will now refer to certain correspondence which passed between the solicitors acting for the parties. On 9 November 1988 the husband's solicitors wrote to the wife's solicitors indicating that the husband wished to have the decree made absolute as soon as possible. They said that the husband was prepared to meet any financial provision the Court might deem appropriate on the wife's pending application for ancillary relief. As a measure of good faith he was further prepared to make $5 million available pending the Court's final order, to be held by his solicitors on interest-bearing deposit, subject to the usual undertakings; they invited the wife's consent to the proposed application under s.17A(4).

18. After the wife's solicitors had sight of the husband's affirmation of means, they replied, on 9 December 1988, saying that in the light of the contents of that affirmation, their client did not consider $5 million enough to pay into Court. This was especially so in view of a certain oral agreement which had been made between the parties at the time arrangements had been made to meet the wife's debt liabilities. I will have to refer later to this alleged oral agreement which is denied by the husband.

19. The judge had before him an affirmation of means filed by the wife on 11 March 1989. It gave a very full account of her assets. While she is not poor, her husband is much wealthier than she is.

20. Although Mayo J. had given his judgment on 14 March, as we know, the order which is the subject of this appeal was not made until 20 March 1989. In his judgment the judge said that in view of the controversy between the parties and the decision of the Court of Appeal, the whole issue of financial relief had been thrown open. It would inevitably be necessary for him to consider the extent, if any, to which credit would have to be given for the assets which the wife had received under the Consent Order and the extent, if any, to which the wife should be given credit for the assets she subsequently transferred back to the husband.

21. The judge noted that in one of her affirmations the wife had stated that a matter which concerned her was her husband's proposed plan to go to Canada. She had said that if he were able to obtain a divorce and marry the lady with whom he was living there would be nothing to prevent him removing all of his assets out of the jurisdiction. One consequence would be to make it very difficult for her to enforce any order which she might obtain in respect of the property due to her.

22. The judge went on to say that having regard to the intention of the relevant legislation it was clearly incumbent upon him to satisfy himself that there was no real risk of the wife being left with an empty judgment. He had also to be satisfied that the husband had made out a case for accelerating the making of a decree absolute.

23. The judge said that he was satisfied that the husband had made out cogent grounds for such an order to be made. He had remained with the lady he was living with for nearly 9 years and if they were to start a family it would be wrong to hold back a decree absolute until the resolution of what appeared to be a long and complex piece of litigation.

24. In the judge's view what was most important in determining whether an order should be made was to have regard to the husband's previous conduct. He was satisfied that he had honourably discharged had all his obligations and had not at any time done anything in this long outstanding matter to thwart the interests of the wife. He had provided financial assistance to his family over and above any legal obligation. This conduct was in stark contrast to the situations which were considered in the four cases cited to him by Leading Counsel for the wife. The wife had not suggested that her husband had at any time attempted to remove any assets from the jurisdiction.

25. It seemed unlikely, the judge observed, that the husband would attempt to evade his responsibilities. Were he to do so, the wife would have numerous legal remedies available to her. She would not encounter undue difficulty in enforcing a court order against her husband in Canada. It also seemed unlikely that the husband would attempt to wind up all his numerous business interests simply to defeat his wife's legitimate claims. It was much more likely that he would continue his business in Hong Kong which traded with companies in Europe and America.

26. The judge stated that he did not think that it would be appropriate to order that any type of bond must be put up. He would however order that the husband undertake to inform his wife of any proposed transfer of substantial assets out of the jurisdiction. He would hear the parties on the form of such an undertaking and the amount of assets it should embrace. The husband would also be required to undertake to make whatever payments were to be ordered by the Court on the wife's application for financial relief. Subject to that, he would order that leave should be given to make the decree nisi, absolute.

27. No agreement was reached between the parties as to the order the Court should make to reflect the judge's decision. They appeared before Mayo J. again on 20 March 1989 and the judge, after hearing further argument, made the order from which this appeal arises.

28. I should mention here that in her affirmation of 13 March 1989 the wife explains the background of the events which led to the agreement of 27 May 1982 which was later embodied in the Consent Order dated 27 July 1982. She states that some time later a situation was reached due, she says, to certain political developments, where she was faced with the prospect of either selling her properties or selling her export quota in order to meet her liabilities. She knew that her husband had been buying quota, while she herself had been selling the use of her quota through a broker. She had therefore approached her husband to lend her money to clear her liabilities in return for his using her export quota for as long as it was necessary for the quota to earn sufficient money for her husband's companies to repay the loans. She envisaged, she says, that by this process both the quota and the properties would ultimately be kept for the benefit of the family as a whole.

29. There is an affirmation from a Mr. Grahame Berkeley sworn on 21 February 1989 which supports the wife and which explains the oral agreement averred by the wife more fully. He is in the insurance business and now lives in England. He met the parties in 1979 and later became a close friend of the family. He entered in some business dealings in partnership with the wife. To a certain extent he had acted as a go-between in the bitter times following the separation.

30. On one of his visits to Hong Kong, during October 1983, the wife had told him of the financial difficulties which were facing her. In discussions, the husband told him that while he was willing to take responsibility from his wife's debts, he had originally understood that they amounted to no more than $13 million. His wife had offered him the use of the quota owned by her companies so that in due course the earnings from the quota would pay off the debt. When the debt was paid off, he would return the use of the quota to his wife so that she would continue to enjoy the income she was intended to receive under the settlement.

31. In his affidavit, Mr. Berkeley goes on to say that the husband told him that when it transpired that his wife's debts were in fact between $25 and $30 million he had had to approach his bank for assistance. His bank had insisted that they would require the wife to transfer title to her properties to provide security for him if he were to assume his wife's liabilities. The husband had stressed at length to Mr. Berkeley that this was not what he was demanding but what his bank were insisting upon.

32. Mr. Berkeley further deposes that he met the husband in his capacity as a go-between and finalised the agreement the parties would enter into, an arrangement in the nature of a mortgage. They estimated that the wife's debts might be paid off in about 6 or 7 years' time. The husband had agreed that when he had received full repayment of the debt, plus interest, from the income generated from the quota, he would re-transfer the title of his wife's properties to be acquired by him as security, and re-assign the quota to his wife or her companies; the object being that the original division of the family assets would be re-established. The husband told him that his bank would not agree to this arrangement and that it would have to be left as private agreement between him and his wife-she would have to trust him.

33. In her affirmation of 13 March 1989 the wife had deposed as follows:

"19. I was most reluctant to sign the documents which are exhibited to the Affidavit of Mr. Niall Giblin sworn herein on the 1st day of December 1987 and marked 'NG-5' to 'NG-9' As an alternative, I was failed with the prospect of either selling the properties or the quota to meet my liabilities, to the ultimate detriment of the family as a whole. I had worked with, lived with and loved the Petitioner for a period of nearly 30 years. He is the father or our children. He pleaded with me that I should trust him. I did not seek legal advice as I had no real alternative, but to accept the promise of the Petitioner and trust him.

20. Since that time, I have had very little income. I have had to live extremely modestly and relied upon the goodwill and generosity of the Petitioner to assist me to live and continue to look after our family. I had always assumed that the Petitioner would abide by our agreement and that, at such time as my debts were repaid from the assets, which I was forced to assign to him, my rightful share to the division of our family businesses would be reinstated, so that the children and I can live with the lifestyle and security derived from my many years of hard work. For the first three years after our agreement, I consistently asked the Petitioner for copies of the record that it was agreed would be kept of income from the assets. During that time, he made excuses and promises. It became apparent in October 1986, after a meeting between Mr. Berkeley and the Petitioner, that the Petitioner intended to renege on his agreement.

21. I verily believe that the sums earned by the Petitioner's companies through the use of the quota assigned nearly 5 years ago to Prosperity Clothing Co. Ltd. have by now repaid all debts and interest assumed by the Petitioner to assist me in my financial difficulties. I am unable to assess this without sight of the accounts of Prosperity Clothing Co. Ltd. By letter of 9th December 1988, my solicitors wrote to the Petitioner's solicitors asking for the audited accounts of that company for the financial years of 1985, 1986 and 1988. This request was refused by the Petitioners solicitors in their letter of 16th December 1988.

22. In the light of the above, I intend to pursue my claims for a division of the family assets upon dissolution of marriage. The disparity between the financial position of the petitioner and myself is clear from our respective Affirmations of Means."

34. Mr. Berkeley confirms that the wife was reluctant to accept this position but had done so. He himself did not believe that it was the intention of either party that by these arrangements the wife would be deprived of her capital assets indefinitely. He had spoken with the husband on 14 October 1987 at the wife's behest and had reminded him of the agreement reached at the end of 1983. The husband had responded by saying that he considered the deal over the quota to be dead and that he had no intention of returning the properties to his wife as he had originally agreed.

35. As mentioned earlier, the husband, in his affirmation supporting his s.17A(4) application, denied any such, what I will call, collateral oral agreement. Of course, if the wife is able to establish its existence, she will be much better off than she is now.

The material parts of Mayo J.'s order of 20 March 1989 were:

".............................

And upon the Petitioner undertaking to the Court through his counsel that:-

(a) Save in the normal course of business he will not:-

i. transfer out of the jurisdiction any of the assets udder his control;

ii. deal in any way with the assets under his control;

iii. dispose permanently of any assets owned by any of the private companies including the properties and quotas owned by those companies;

iv. he will comply with any order that the Court may make for ancillary relief to the Respondent.

And upon hearing Counsel for the Petitioner and Leading Counsel for the Respondent.

IT IS ORDERED THAT:-

1. The Petitioner do have leave to apply forthwith for the decree nisi pronounced herein on the 5th day of November 1986 to be made absolute notwithstanding the pending application by the Respondent filed herein on the 25th day of October 1986 under Section 17A(1) Matrimonial Causes Ordinance.

2. [Costs]

3. Liberty to apply.

4. [Stay pending appeal]"

36. I will now read s.17A of the Matrimonial Causes Ordinance, Cap.179:

"17A. (1) This section shall apply where -

(a) the respondent to a petition for divorce in which the petitioner alleges any such fact as is mentioned in section 11A(1)(d) or (e)has applied to the court under this section for it to consider the financial position of the respondent after the divorce; and

(b) a decree nisi of divorce has been granted on the petition and the court holds that the only fact on which the petitioner is entitled to rely in support of his petition is that mentioned in section 11A(d) of (e).

(2) The court hearing an application on by the respondent under subsection (1) shall consider -

(a) all the circumstances, including the age, health conduct earning capacity, financial resources and financial obligations of each of the parties; and

(b) the financial position of the respondent as, having regard to the divorce, it is likely to be after the death of the petitioner should the petitioner die first.

(3) Notwithstanding anything in this Ordinance but subject to subsection (4), the court shall not make absolute the decree of divorce if an application has been made under subsection (1), unless it is satisfied that -

(a) the petitioner should not be required to make any financial provision for the respondent; or

(b) the financial provision made by the petitioner for the respondent is reasonable and fair or the best that can he made in the circumstances.

(4) The court may, if it thinks fit, proceed without observing the requirements of subsections (2) and (3) if-

(a) it appears that there are circumstances making it desirable that the decree should be made absolute without delay; and

(b) the court has obtained a satisfactory undertaking from the petitioner that he will make such financial provision for the respondent as the court may approve."

37. These provisions derive from s.6 of the U.K. Divorce Reform Act 1969, now replaced by subsections (2) to (4) of s.10 of the Matrimonial Causes Act 1973. Therefore the English authorities are of assistance.

38. On behalf of the wife, Mr. Rodway has submitted that the judge was wrong to find that circumstances had been shown which made it desirable that the decree should be made absolute without delay (s.17A(4)(a) of the MCO) and to hold that the husband had given a satisfactory undertaking that he would make financial provisions for the wife as the Court may approve (within the meaning of s.17A(4)(b) of the MCO). The Court was bound, therefore, to observe the requirements of subsections (2) and (3) of s.17A which it had failed to do, and leave to make the decree absolute should not have been given.

39. In relation to the matters relevant to s.17A (4)(a) Mr. Rodway contends that the husband has not pursued his decree absolute with sufficient expedition and that there was no particular reason for the judge to assume that the necessary financial enquiries would be unduly lengthy. The only complicated factor in this case was the resolution of the controversy over the alleged oral collateral agreement. The hearing might take some days, but not years or even months.

40. I mean no disrespect to Mr. Rodway's submissions by not reviewing them in this Judgment in detail. I have carefully considered all that he has urged upon us. It is the trial judge who is given the duty of deciding upon the sufficiency of circumstances for the purpose of s.17A (4)(a), and it will be a rare case in which a carefully considered decision (as this was) will be overruled by an appellate Court. I will only say that there was ample material before the judge to justify the conclusion he reached and I find it impossible to disturb his finding.

41. I entertain no doubt that if paragraph (b) of subsection (4) of s.17A had also been complied with, the appeal would have to be dismissed. I now turn to consider the submissions made on behalf of the wife that the judge erred in law in accepting the undertakings offered by the husband, and contained in the order appealed against, as satisfying the provisions of paragraph (b).

42. We are indebted to Counsel for having cited to us all the reported cases on s.6 of the Divorce Reform Act 1969 and on s.10 of the Matrimonial Causes Act 1973 which replaced it. I will first refer to some of the cases which indicate how the Courts have applied these provisions where the equivalent of s.17A (4) of the MCO did not fall for consideration. In Parkes v. Parkes [1971] 1 WLR 1481, the Court of Appeal, dismissing an appeal by a husband petitioner, held that since the wife had only allowed proceedings for divorce to go uncontested because she and her advisers had thought that proper provision had been made for her by an agreement which had been made an order of the Court, and it had transpired that the parties were not really agreed, the judge's decision to stay the making of the decree absolute until further order was right. The equivalent of s.17A(3) of the MCO had not been satisfied. The wife was given leave either to apply for the petition to be reheard relying on s.4 of the Divorce Reform Act 1969 (s.15B of the MCO) or she could ask the Court under the equivalent of s.17A(3)(b) of the MCO to consider whether the financial provision made for her was reasonable and fair or the best that could be made in the circumstances. One of he members of the Court, Phillimore L.J. observed, at p.1485: "The whole scheme of this Act in dealing with cases such as this, where a man has left his wife and lived with someone else for five years and wants a divorce, is to ensure that the wife is protected financially."

43. In Wilson v. Wilson [1973] 1 WLR 555 the Court of Appeal held that the expression "financial provision made" in the equivalent of s.17A(3)(b) of the MCO did not include a mere proposal and ordered that the decree was not to be made absolute until the husband petitioner had inplemented his proposal (that the matrimonial home be sold and the proceeds divided between the parties). Davies L.J. had this to say at p.558:

"I do not think that it is right that a decree absolute should be made unless the wife is in a position to be guaranteed the financial provision which is offered and which the court approves."

Stephenson L.J. concluded his concurring judgment, at p.559, by observing:

"I regard it as important that the protection given by section 6 of the Act of 1969 should not be whittled away by allowing a decree to be made absolute before reasonable and fair financial provision for the respondent has been actually made ...."

44. The decision in B. v. B. (1974) 118 Sol .Jo. 242 simply illustrates that a wife's application for financial provision falls to be dealt with under the equivalent of the MPPO. Megaw L.J. is reported to have remarked that s.6 of the 1969 Act (s.17A of the MCO) was concerned with the fact that the Court must satisfy itself before decree absolute that reasonable and fair financial provision had been, or would be, made.

45. I also consider it helpful to read the observations of Ormrod L.J. in Hard v. Hardy (1981) 2 FLR 321 about the interrelationship between applications for ancillary relief and the equivalent of s.17A of the MCO. He had this to say at pp.327-328:

"    That leads me to say something about s.10 of the 1973 Act, because it looks as though s.10 is falling into disuse. Section 10(3), which I have already read, is intended to provide a protection to a wife particularly (also to husbands in certain circumstances) who is divorced either on 2 years separation or on 5 Years separation, and it was put in by Parliament to prevent just this kind of situation arising, namely a divorce against her will at a time highly convenient to the husband financially, and potentially highly prejudicial to her in the future. The section requires the court not to make a decree absolute unless

'... the financial provision made by the petitioner to the respondent is reasonable and fair, or the best that can be made in the circumstances.'

That requires the husband to make some financial provision and it leaves the wife with the opportunity of saying, 'I submit the provision is not reasonable, therefore the decree should not be made absolute' She is entitled to take up that position and to stop there if she wishes. She may wish, of course, and it may be more convenient to her, to argue first that the financial provision made is not adequate and then at the same time to ask the registrar to make an order under s.23 or 24, but it is up to her whether she does that.

It is also right to remember and to remind people that under, s.10 (3) the court itself can say 'we are not satisfied about this' and it may well be that the court will think in certain cases (and this is one) that the best order it can make under s.23 or 24 is not adequate to protect the wife and is not, in all the circumstances, reasonable and fair provision for her, bearing in mind that she is being divorced against her will. Consequently, the court can say in those circumstances to a husband, 'if you want your decree absolute, then you will have to put forward some proposals and implement them before the decree is made absolute.' What those proposals are will vary, of course, from case to case but they would not necessarily be within the four corners of the court's jurisdiction under ss.23 and 25, because the sanction is that the decree will not be made absolute."

And at p.340 Dunn L.J., emphasised: "Section 10, as Ormrod L.J. has said, is a most important section for the protection of wives and its provisons should be applied."

46. Mr. Rodway relies strongly on the decision of the English Court of Appeal in Grigson v. Griyson [1974] 1 WLR 228. I will have to quote extensively from the judgments. There the parties had married in 1938. They separated in 1954 and the husband left his wife to live with a woman by whom he had a child. In an undefended suit, which he instituted in 1972, he obtained a decree nisi of divorce on the ground that the marriage had broken down irretrievably as evidenced by the fact of 5 years' separation. The wife then applied under s.6 of the Divorce Reform Act 1969 (s.17A of the MCO) for the Court to consider her financial position and whether or not her husband should be required to make financial provision for her (he had been paying her a weekly sum since the separation).

47. Since that application had not been heard for almost a year, the husband applied to dismiss it for want of prosecution. At the same time he applied for leave to make the decree nisi absolute upon an undertaking that that he would make such financial provision for his wife as the Court might approve, pursuant to s.6(3) of the Act (s.17A(4) of the MCO) on the ground that circumstances made it desirable that the decree should be made absolute without delay and that the Court had obtained a satisfactory undertaking from him to make such financial provision for her as the Court might approve

48. Judge Stockdale granted the husband's application for leave upon his undertaking to make such financial provision from his wife as the Court night approve.

49. The wife appealed to the Court of Appeal (Davies, Buckley and Lawton L.JJ.). Davies L.J. reviewed the facts, noting that as the evidence stood, the evidence of the husband's financial position was very slight and showed a very poor state of affairs and that the wife's application for ancillary relief had not been heard. At page 231, he said:

"But as things stand at the moment I cannot see that the undertaking which this husband has given is of any value to the wife at all. It may be that when inquiries are made into his financial state it will prove that his present evidence is substantially correct, although the wife challenges it and asks rhetorically what has happened to the copyrights of the large number of books that the husband has written? In the present case no suggestion, as I see it, was made by the husband as to the sort of thing that he might be able to do; and we do not know what he will be, able to do when the inquiry is completed.

A number of difficulties arise under the statute. For example, as has been pointed out in the argument, the adjective 'satisfactory', in the phrase 'satisfactory undertaking', is an odd one. If the court accepts an undertaking from a litigant, the court obviously would not accept it unless it was satisfied with the undertaking. Then again, when the statute speaks of 'such financial provision for the respondent as the court may approve', when is the court's approval to be given? In the present case, if the judge's order stands, I suppose it would only be after financial inquiries and some sort of figure were to be reached that the court would be asked to approve it. For my part, I agree with what Buckley L.J. said in the course of the argument, namely, that the approval of the court should, in outline at least, to use a planning word, be obtained when the judge is asked to give permission for the decree to be made absolute. One would not expect proposals in a completely concrete and detailed form to be put before the court at that stage. There may be, in a given case, many financial matters to be inquired into. But I should have thought that before a judge is asked to exercise this jurisdiction the husband ought to put before the court an outline of what he thinks he will be able to carry out and what he is proposing to do and then an undertaking should be taken from him on the basis of those proposals if they are approved of by the court then, and not at some later, unspecified time. In other words, the approval of the court, in outline at least, should be asked for and given at that date and not at some vague, unspecified time in future.

The form in which the judge has made the order-merely reciting the words of the statute-means that the husband is undertaking to do in the future something which is completely unspecified, and he is undertaking to do something which he may not be able to perform. I think that that is a misapplication of section 6. Although I appreciate the difficulties of its, interpretation, in my opinion judges who are asked to exercise this Jurisdiction and make an order giving leave to apply for the decree nisi to be made absolute, ought to be satisfied before they make the order that the proposals which the husband is making are 'satisfactory'and to use the words of subsection (2), 'reasonable and fair or the best that can be made in the circumstances,' and not merely leave it to the future to see what will be provided when the matters are properly inquired into."[Davies L.J.'s emphasis]

At pp.232-233, Buckley L.J. stated:

".... it appears to me that such an undertaking is in the nature of a blank cheque, both as regards the petitioner and as regards the respondent. The petitioner does not know what he may be required to do. The respondent does not know what she will obtain as the result of the undertaking. It seems to me to be very unlikely, having regard to the shape of section 6 as a whole, that such an undertaking could have been one contemplated by Parliament as sufficient to satisfy the requirements of subsection (3)(b). When one comes to look at that subsection as a whole, it seems to me clear that that cannot have been the intention. The subsection is an enabling section: it permits the court, if it thinks fit, to proceed without having regard to the requirements of subsection (2) on the two conditions which I have mentioned

If the undertaking is to be regarded as 'satisfactory merely from the point of view of the good faith in which the undertaker gives the undertaking, it seems to me that the word 'satisfactory' adds nothing whatever to the operation of the section, for the court would never, in the exercise of its discretion, dispense with the requirements of subsection (2) if it thought that the undertaker was one who did not in good faith intend to carry out his undertaking, and the word 'satisfactory' would not be required in the subsection at all. 'Satisfactory' must, in my judgment, here refer to the nature and content of the undertaking; and the undertaking given in the present case is one which really can be said to have no specific content at all: it is merely an indication that when the position has been investigated the petitioner will do what the court shall then approve. In my judgment, the words 'may approve' here do not refer to some time in the future but refer to the moment at which the court is considering whether the undertaking is satisfacoty; and the 'undertaking' must, I think, be an undertaking relating to some formulated proposal on the part of the petitioner as to the kind and amount of financial provision which he will make. It need not, I think, be a proposal which is specific in all  its details, or necessarily specific as to amount, but it must be a proposal of a kind which the court in the circumstances can approve as a 'satisfactory undertaking' having regard to all the facts of the case."

50. Buckley, L.J. had earlier (at p.232) referred to the object of s.6 of the 1969 Act (s.17A of the MCO) as being "to afford a respondent against whom a divorce is sought after five years' separation and without consent ... a means of ensuring that the divorce shall not take final effect until proper financial provision has been made, or clearly will be made, for the respondent".

51. At p.234 Lawton L. J. also spoke of the purpose of s.6(3) of the 1969 Act (s.17A(4) of the MCO):

"It seems to me that section 6(3)(b) of the Act of 1969 lacks that clarity which is desirable in a statute which affects such a large section of the population. The clue to its interpretation lies, I think, in the policy of the Act itself. It is clear that this Act was so drafted as to give protection to those wives who found themselves divorced on the sole ground that they had lived apart from their husbands for a continuous period of five years preceding the presentation of the petition. Parliament was solicitous for their welfare, and rightly so. Indeed, so solicitous that is section 4 Parliament provided that the petition should be dismissed if the dissolution of the marriage would result in 'grave financial or other hardship. In those cases where the dissolution of the marriage would not result in that degree of hardship, there was to be financial protection for the wife. The provisions relating to financial protection are set out in section 6. Sub-section (2) of that section provides for a far ranging enquiry as to what, in all the circumstances.... is reasonable and fair or the best that can be [done] in the circumstances.' Parliament, however, seems to have envisaged that that kind of far reaching inquiry might take time; and anyone who has had experience of the Family Division knows that from time to time it is in the interests of other people besides the husband that a decree nisi should be made absolute without too much time being taken up with ancillary inquiries.

That seems to me to have been the purpose of subsection (3). In the present case it was said that it was in the interests of the lady with whom the husband is now living and the child of their relationship that the decree should be made absolute. But in providing for a decree nisi to be made absolute in those special circumstances, in my judgment it was not the intention of Parliament to give an escape route for husbands. If this kind of undertaking is accepted as a 'satisfactory' undertaking, then, in my judgment, there is such an escape route,"

52. The interpretation of s.17A (4)(b) of the MCO urged upon us by Miss Leong may thus be summarised. She points out that there is a clear distinction between what the husband must do under s.17A (3) and s.17A (4). Under subsection (3), she contends, there must be a completed deposition and the Court must be satisfied it is appropriate before allowing the decree absolute. The consideration whether the disposition is satisfactory must be in accordance with s.17A (2) of the MCO or s.7(1) of the MPPO, substantially similar provisions, because those are the only criteria which guide the Court on standards for an award.

53. But, Miss Leong argues, under s.17A (4) of the MCO the Court has a discretion to ignore the provisions of subsections (2) and (3) of that section if it has a "satisfactory undertaking" that the husband will, in the future make provision of which the Court will approve at that time. She submits that the purpose of s.17 (A) is to protect the wife in 2 or 5 years' separation cases, and where she has no defence to a divorce, against a husband who might simply disappear before the Court could deal with her claim for ancillary relief, or may conceal assets or put the wife into a disadvantaged position because of the long separation. The vigilance of the Court is requited to get a "satisfactory undertaking" rather than a satisfactory proposal or award. She suggests that that undertaking should be viewed in the same light as the "satisfactory undertaking" mentioned in s.18 (2) of the MPPO, which is in these terms:

"(2) The court shall not make an order declaring that it is satisfied as mentioned in subsection (1)(c) unless it has obtained a satisfactory undertaking from either or both of the parties to bring the question of the arrangements for the children named in the order before the court within the specified time."

54. Grigson v. Crigson does not, of course, interpret the equivalent of s.17A of the MCO in that way. I do not propose to attempt to formulate the principles upon which Courts decide what is the true ratio decidendi of an authority. Of course, every decision must be read as being applicable to the particular facts proved or admitted but the ratio is ascertained by a careful consideration of the judgment(s) in relation to the subject matter of the decision.

55. Speaking for myself, I have no doubt that the ratio of the decision in Grigson v. Grigison is correctly stated in the headnote at p.228:

"Held, allowing the appeal, that be fore a court could grant leave to make a decree nisi absolute without the financial investigation required by section 6 of the Divorce Reform Act 1969 having taken place a petitioner had to formulate proposals in outline as to the future provision he intended to make for the respondent and the court had to be satisfied that those proposals were reasonable and fair or the best that could be made in the circumstances and should not grant leave to make the decree absolute on the basis of an undertaking to make such provision as the court might afterwards approve at some later unspecified time (post, pp.231F, H, 233D, E); and that since there were no such proposals in the present case, the husband's undertaking was not satisfactory and leave to make the decree nisi absolute should not be given."

56. I am of the respectfu1 view that the Editors of the All England Reports also got the ratio of that case right at [1974] 1 All-ER 478, although their formulation is slightly different:

"Held - The appeal would be allowed and the order set aside. On the true construction of s.6 (3)(b) the court, before proceeding to make a decree absolute, had to approve proposals for financial provision submitted by the petitioner, at least in outline, and then obtain from him an undertaking that those proposals would be given effect. It was not sufficient for the petitioner merely to give an undertaking that he would 'make such financial provision ... as the Court may approve' at some unspecified date in the future. Since the husband had failed to give, even in outline, any indication of the kind and amount of financial provision which he thought he could make for the wife. he had failed to give a 'satisfactory undertaking' within s.6(3)(b) and the wife's appeal would therefore be allowed (see p.481 d to h, p.482 h and j, p.483 d and p.484 a and b, post)."

57. As I read the judgments in Grigson v. Grigson the members of the Court, when expressing their views upon the true construction of s.6 (3) in the l969 Act, did not make them dependent upon the fact that the husband was impecunious. I do not see how it could be maintained, if that indeed was the suggestion, that the observations, particularly, of Davies L.J. at p.231 D-G and of Buckley L.J. at p.233B-E were dicta:"

58. I am aware of the warning note struck by Lord Upjohn, giving the judgment of their Lordships in the Privy Council in Ogden Industries Pty. Ltd. v. Lucas [1970] AC at p.127 which, if I may say so, bears reading in the light of some of the arguments addressed to us:

"They desire to reiterate however what has so often been said before that in a common law system of jurisprudence which depends largely upon judicial precedent and the earlier pronouncements of judges, the greatest possible care must be taken to relate the observation of a judge to the precise issues before him and to confine such observations, even though expressed in broad terms, to the general compass of the facts before him, unless he makes it clear that he intended his remarks to have a wider ambit. It is not possible for judges always to express their judgments so as to exclude entirely the risk that in some subsequent case their language may be misapplied and any attempt at such perfection of expression could only lead to the opposite result of uncertainty or even obscurity as regards the case in hand.

These general principles are particularly important when questions of construction of statutes are in issue.

It is quite clear that judicial statements as to the construction and intention of an Act must never be allowed to supplant or supersede its proper construction and courts must beware of falling into the error of treating the law to be that laid down by the judge in construing the Act rather than found in the words of the Act itself.

No doubt a decision on particular words binds inferior courts on the construction of those words on similar facts but beyond that the observations of judge on the construction of statutes may be of the greatest help and guidance but are entitled to no more than respect and cannot absolve the court from its duty of exercising an independent judgment. It is with these principles mind that their Lordships approach this very considerable body of authority."

59. In Commissioner of Inland revenue v. Hang Seng Bank Ltd. I.R. Appeal No.7 of 1988 (3 May 1989, as yet unreported) Clough J.A. applied this principle at pp.18-19 of the transcript, citing Ogden Industries:

"    In the course of argument various tests were advocated as appropriate for determining whether the profits in question arose in or were derived from Hong Kong. I can see no objection to a broad practical 'operations' test being applied as was done in the cases cited by Cone V.-P. in his judgment. However, I emphasise that the words 'arising in or derived from' are ordinary unambiguous words. It is those words which constitute the law to be construed and applied and they are not to be superseded by judicial statements as to the construction and intention of the Ordinance or other similar enactments."

60. I would illustrate how I understand what I have called "the warning note" sounded by Lord Upjohn in Ogden Industries, by stressing that our task is to construe and apply the words actually used by the legislature in s.17A of the MCO and not treat the law as being, for example, that "... the Court must satisfy itself before decree absolute that reasonable financial provision had been, or would be, made" per Megaw L.J. in B. v. B.

61. It need hardly be said, however, that the principle of stare decisis applies equally to authorities interpreting statutes. The matter is succinctly and accurately explained in HALSBURY'S LAWS OF ENGLAND (4th Ed.) Vo1.44, para.842:

"Binding force of precedent. The ordinary rules as to the binding force of precedent, and as to the powers of superior courts to revise or overrule the decisions of inferior courts, apply to cases of interpretation of statutes as to other cases. It is, however, the actual decision of a court which is binding and not the words used by the judges in giving the decision, and the courts must guard against the danger of construing the expositions of a statute in previous cases, instead, of the words of the statute itself."

62. I venture to express my opinion that Grigson v. Grigson would bind courts in England and Wales below the Court of Appeal (and, indeed, the Court of Appeal itself subject to well-known exceptions). If the decision as to how s.6 (3)(b) of the 1969 Act (s.17A(4)(b) of the MCO) should properly be construed and applied had emanated from the House of Lords it would effectively have bound the courts in Hong Kong: de Lasala v. de Lasala [1980]AC 546. I have particularly in mind Lord Diplock's observations at p.588 about decisions of the House of Lords interpreting recent legislation common to Hong Kong and England.

63. Grigson v. Grigson was a decision by a strong Court of Appeal. It has not since been doubted during the 16 years which have passed. Instead it has been approved in Cumbers v. Cumbers [1974] 1 WLR 1331 where the Court of Appeal varied an order for financial provision for a wife. The lower court had made an order by consent that the husband be at liberty to make the decree absolute forthwith on his undertaking to make such financial provision as the Court should approve under the equivalent of s.17A (4)(b) of the MCO. About that form of undertaking, Lord Denning, M.R., who gave the leading judgment, remarked at p.1333:

"But that [the giving of leave to make the decree absolute) was only done upon [the husband's] undertaking that he would make such financial provision for his wife as the Court may approve. That order was made by consent. So the wife cannot complain of it.  But Grigson v Grigson [1974] 1 W.L.R. 228 shows that an undertaking in that form is undesirable. If the sum is not fixed beforehand, the wife is helpless. The actual financial provision ought to be fixed beforehand."

64. Grigson v Grigson does not bind this Court, being only of persuasive authority, but I think it should be followed in Hong Kong, because in my respectful opinion it was correctly decided. All the three Lord Justices remarked that s.6 (3) of the 1969 Act (s.17AM of the MCO) presented difficulties of interpretation. I do not propose that we should follow Grigson simply because the construction put upon the relevant words by the Court of Appeal was one which they could bear but because in my judgment, the decision correctly reflects the intention of the legislature by the words that were enacted.

65. It will be recalled that the husband undertook "[to] comply with any order that the Court may make for ancillary relief to the Respondent". There are difficulties inherent in this formulation. If it merely means that he will obey the order of the Court, it says nothing, for he is bound to do so. If he failed to obey the order (and I am not for one moment suggesting that he would) would enforcement proceedings be founded upon the breach of the earlier undertaking or upon the breach of the later order? If he were legitimately dissatisfied with the order for financial relief made by the Court, could it be said, that by the form of his undertaking he had deprived himself of his rights of appeal?

66. I recognise, however, that this is not all that the husband undertook. He submitted himself to the most stringent restrictions it is possible, perhaps, to imagine as to the way he would be permitted to deal with his property until the ancillary relief claim can be disposed of. Even if the conditions in s.17 (1)(a) of the MPPO were satisfied, it is extremely doubtful whether, on the application of the wife, the Court would have made an order in terms as rigorous as the formulation in para. (a)i, ii and iii of the undertaking, given to the judge.

67. Added to this (the unresolved dispute over the alleged oral collateral agreement apart) the husband has at all times behaved honourably and generously in financial and property matters towards his wife and children. And the evidence shows that he did his best to come to some sensible arrangement with his wife, both before he made his application under s.17A(4) and after Mayo J. gave judgment on 14 March 1989, to relieve the anxieties to which she said she was prey.

68. I feel bound to say that the proper determination of the issues in this difficult appeal is not assisted by attributing to the wife a desire to "blackmail" her husband, or by describing her attitude by similar emotive epithets. The marriage is dead, it is true, but she did not want a divorce for reasons which she explained and, according to her (I do not know that her husband has ever denied this) she was given a promise that she would not be divorced. It seems to me, that despite the earlier arrangements agreed to on the judicial separation, just as the husband is entitled to rely on the 5-year "living apart" provisions in the present law of divorce, the wife is entitled to insist upon her rights under s.17A of the MCO.

69. In any given case (I do not mean to suggest that this is such a case) a wife's conduct might appear to be vindictive, obstinate or even rapacious, but it need hardly be said that considerations of this kind would not allow a Court to deny her the protection of statutory provisions, properly applied. It must be borne in mind that where s.17A (4) is in point, the Court is the arbiter, for the proposals which the Court must approve are those reasonably put forward by the husband and not proposals unreasonably advanced by the wife.

70. It is plain that in the instant case, for a number of reasons, not least the problem of the alleged oral collateral contract yet to be resolved, it would have been extremely difficult for the husband to decide what proposals he should make for the purposes of s.17A (4)(b) in the form approved by Davies L.J. at p.231 E-G, and by Buckley L.J. at p.233 D-E, of the report of Grigson v. Grigson. It may be, too, that if the pending proceedings are protracted (as they promise to be) his decree absolute will be considerably delayed, a delay which will gravely affect him and Miss K as well. But theseconsiderations, weighty though they are, do not provide grounds for surmounting the hurdle presented by what I consider to be the true construction of s.17A(4) (b) of the MCO.

71. If, instead of what is enacted by paragraph (b), the legislature had provided that the Court must be satisfied, by undertakings given by the petitioner or otherwise, that the petitioner will be in a position to make, and will make, reasonable and fair financial provision for the respondent, then, the husband's ample assets coupled with the undertakings he gave would have been more than sufficient. But as I interpret paragraph (b), with the assistance of Grigson v. Grigson, this is not what it says. It appears that the judge had in mind considerations of that kind when he said, at the foot of p.4 and the top of p.5 of the transcript of his judgment:

"Having regard to the intention of the legislation it is clearly incumbent on me to satisfy myself that there is no real risk of the wife being left with an empty judgment."

and when he said of the husband, later, at p.6: "... it seems unlikely that he would attempt to evade his responsibilities. "

Although anyone who has read all the papers in this case might be forgiven for having a considerable measure of sympathy for the husband, I feel constrained to hold that s.17A (4) (b) of the MCO was not satisfied. I would, therefore, allow the wife's appeal and set aside the judge's order of 20 March 1989.

As I understand the position, there would be nothing to prevent the husband from making a fresh application if he felt able to put forward proposals (if necessary only in outline) for the Court to consider. If approved, an undertaking that his proposals would be given effect would follow and s.17A (4)(b) of the MGO would be satisfied.

Hunter, JA

72. I gratefully adopt my lord the Vice President's comprehensive statement of the material facts and citation of the relevant statutory provisions. I regret my inability to accept his conclusions.

73. It can be seen at once that this is a wholly exceptional case, as different as could be imagined from the facts of any of the reported UK cases. This husband is in the happy position of being able to assert and demonstrate his ability to meet any order that the court may hereafter make. He has assets valued last October at HK$175m. Over HK$165m worth of these are in Hong Kong. The undertakings he has given to the court ensure that these assets will be utilized only in the ordinary course of business and will be available to satisfy any future order.

74. The size and value of any financial provision the court may hereafter order for the wife is presently a matter of pure speculation. The possibilities range from a very modest order, to orders perhaps worth HK$70m or HK$80m. If she succeeds up to the hilt in her claims under what has been called the sub-agreement, she could emerge better off than she was under the 1982 settlement because she would recover all the reconveyed property without deduction for the discharge of debts. This could produce the first possibility. The second would follow from a court's acceptance of her claims as formulated by Mr Rodway.

75. In these circumstances the husband submits it is idle for him to make or for the court to consider any proposal from him. No basis for serious computation or assessment exists. It would be pure lottery or crystal gazing. It is sufficient he submits for him to show, as he can, an ability to meet any order and to secure that position. This he claims to have done to an extent beyond the wildest dreams of most divorced women.

76. If the purpose of section 17A(4) is to protect the reasonable financial claims of a wife under sections 4, 6 and 7 of the Matrimonial Proceedings and Property Ordinance (Cap 192), then it seems to me clear beyond a peradventure that the husband's undertakings provide this wife with complete security. Her present protection is as good as it would have been had the court been able to assess and order financial provision now under section 17A(2) & (3).

77. Although Mr Rodway initially submitted that the Parliamentary intent in England was to protect the wife in the above manner, his later submissions assumed a very different aspect. The purpose was not to ensure financial provision which the court might after full enquiry decide was "reasonable and fair," but to give the wife an opportunity to exploit her position of marketing the decree absolute. Mr Rodway was totally frank. The husband he said had to "buy" his decree absolute. He likened the price to Danegeld ie a form of tribute or ransom payable to the wife. He adopted as appropriately descriptive the word "blackmail".

78. He submitted that this was achieved in this way. However difficult the task the husband had to put forward specific proposals. In some way, which was never made clear to me, the court had to assess these proposals with a view to deciding whether they were satisfactory in the sense of sub-section (3). The court could then only grant leave under sub-section (4) against the husband's undertaking to implement these proposals in any event. If after full enquiry the court came to the view that the proposals were inadequate, then greater financial provision could be ordered. But if conversely after full enquiry fair and reasonable financial provision his determined at something less than these proposals, the court could not relieve the husband from any part of his undertaking (I power which had earlier been conceded) or order less than the full implementation of the undertaking. The difference between reasonable provision as determined and the cost of the undertaking was the Danegeld ?the price of the decree absolute. This was the lottery it was submitted, that Parliament had compelled a man to enter into it, who for any reason desired to expedite his decree absolute. This conclusion it was submitted was imposed upon the court by the true construction of section 17A(4) as laid down in Grigson v Grigson [1974] 1 WLR 228 which this court was invited to follow and apply.

79. The politest thing I can say about this submission is that I wholly reject it. In my judgment neither the true construction of the section, nor the decision in Grigson or any other UK authority, leads to this grotesque conclusion.

80. The effect of the English authorities can I think be summarised thus:

(1) The whole purpose of the UK equivalent of section 17A, which was first section 6 of the Divorce Reform Act 1969 and later section 10 of the Matrimonial Causes Act 1973, was to protect the wife; to ensure that she received no less and no more than "financial provision" that "was reasonable and fair or the best that can be made in the circumstances"

(2) This protection was sought to be achieved in two ways.

(3) The first, by our sub-sections 17A(2) & (3), is for the court to make a full enquiry into the financial position of both parties (in this respect section 6(2) of the 1969 Act in England anticipated section 5 of the 1970 Matrimonial Causes Act) with a view to ascertaining whether or not the financial provision in question met the criteria in sub-section (3). What has here to be investigated is provision "made" not simply proposed: Wilson v Wilson [1973] 1 WLR 555. The investigation is completed before Decree Absolute.

(4) The second way is under our sub-section (4). As Lawton LJ pointed out in Grigson at p 234 the reason for this sub-section clearly was that "Parliament ... envisaged that that kind of far reaching enquiry (under our sub-section 3) might take time and that ... from time to time it is in the interests of other people beside the husband that a decree nisi should be made absolute". Factually that is the position here. In my judgment circumstances clearly exist which make it desirable that the decree should be made absolute without delay. Secondly the enquiry between the parties will be particularly protracted having regard to the need first to resolve the wife's contractual and/or proprietary rights under the sub-agreement.

(5) I can detect nothing whatever either in the section or authority to suggest, that sub-section (4) is intended to enable the wife to do better than under sub-sections (2) & (3); to exploit the complexity of the enquiry or a husband's possible concern for the well-being of his new wife. In my judgment the purpose of the sub-section is to empower the court to ensure that the wife will in the future receive no more and no less than financial provision which satisfies the criteria in sub-section (3) and not some chance bonus in addition.

(6) In particular I can find no support for this suggestion in Grigson. There the court was faced with the lower court s acceptance of an undertaking which precisely followed the wording of our sub section (4). The only question, and it was a very important question, was the sufficiency of that undertaking. The court unanimously concluded that for a person in the position of Mr Grigson whose declared means both capital and income were very slender, and whose true means, true ability to pay was quite unknown such an undertaking was worthless and of no value to the wife. There was nothing upon which the undertaking could bite and it had no specific content at all. If such an undertaking was accepted it would provide an "escape route" for husbands and nullify the protection section 6 (as it then was) was intended to give.  Such is the tenor of all the judgments.

(7) In my view Grigson is clear authority for two propositions. The first is that an undertaking in the precise terms of section 17A(4), and no more, is insufficient. The second is that to be sufficient the undertaking has to have certainty, specific content and something upon which it will bite, ie sufficient to give real protection to the wife. Judged by these criteria the present undertakings pass comfortably. Collectively they amount to an undertaking to meet any order, which is fortified to the hilt.

(8) The above conclusions were sufficient for the determination of that case. But no doubt in an attempt to assist the legal profession the court went on to suggest how a person with limited means could provide an acceptable undertaking. I have considerable doubts as to how far that part of the decision can be said to form part of the ratio decidendi. But even assuming that it did, I have no doubt that the court never intended its observations to apply to a man with sufficient means to give the undertakings now before the court.

(9) An applicant under sub-section (4), who has only limited means, is faced at the outset with the difficulty occasioned by his inability to meet any order. To give content and particularity to any undertaking, he has of necessity to specify his ability and what he says he can do. His impecuniosity forces him to define his position and limit his undertaking. The court can then see how far this is realistic and how far the wife can be secured in those respects. In relation to any proposal for future periodic payments little can be done beyond perhaps an undertaking not voluntarily to leave his job. In relation to capital proposals more concrete steps may be open. It follows in my judgment that the need for specific proposals suggested in the judgment arose from the facts of that case, stem of necessity from impecuniosity, and can be seen to have no application to the man capable of meeting any order.

(10) Possibly the court, and certainly Buckley LJ, further expressed the view that the words "may approve" "do not refer to some time in the future but refer to the moment at which the court is considering whether the undertaking is satisfactory". p 233. With the greatest respect to that most distinguished judge, I do have great difficulty in accepting this conclusion. The full phraseology in sub-section 4 is "that he will make such financial provision for the wife as the court may approve". "Will make" points unequivocally to the future. I cannot see how such future provision can be otherwise than assessed and approved after full enquiry in the future. I accept Megaw LJ's paraphrase of the impact of the section in B v B (1974) 118 SOL. JO 242 where he said that the effect of the section was that "the court must satisfy itself before decree absolute that reasonable and fair financial provision had been, or would be, made". I cannot therefore accept that the words "may approve" relate exclusively and only to the time when the court is considering the sufficiency of any undertaking.

(11) I accept that the phrase "may approve " could be read as applying to both times, both the approval of the undertaking and the approval of the ultimate financial provision. This may have been the view of Davies LJ. But if the phrase does relate in whole or in part to the former time, the wording of the judgments of both Davies and Buckley LJJ show to my mind conclusively that they then envisaged outline or provisional approval of proposals not final approval of the ultimate provision ordered: see "the approval of the court in outline at least" per Davies LJ p 231 : and "it need not I think be a proposal which is specific in all its details or necessarily specific as to amount" per Buckley LJ p 233. I can therefore find in this decision no hint of support for the suggestion that such approval, when embodied in an undertaking, becomes irrevocable, and fixes the wife's minimum provision however erroneous or unreasonable it might prove upon full enquiry to be. I am convinced that the members of that court would have found the present lottery submission as unattractive and offensive as do I.

81. I have no doubt that the legislative intent behind the whole of section 17A is to give the wife protection and, within the limits of the practical, to ensure that she receives then or thereafter fair and reasonable financial provision. The purpose of the section is defensive not offensive: it is a shield and not a sword. That this was the legislative purpose in England is made clear by the English authorities which also deal with the problems of providing security in particular cases. But in every case this is ultimately a question of fact. In my judgment the wife now enjoys one hundred percent protection under Mayo J's order. She has no cause for complaint about it, and her overt attempt to hold her husband to ransom fails.

Macdougall, J.A.:

82. Although the argument before this court occupied two days, the point in issue is, I venture to say, one of no great complexity.

83. I find myself totally unable to accept Mr. Rodway's submission which, in its final and fully developed form, was that if a husband seeks relief from the court under section 17A(4), he must "buy" the expedition of the decree absolute at a price from the wife.

84. Lest we were in any doubt as to the full significance of that submission, Mr. Rodway illustrated it with analogies. He sought to liken the price to an ancient form of tribute, danegeld, and to a golden key without which the door to the expedition of the decree could not be opened. He did not flinch from the use of the word "blackmail" borrowed from a passage in Grigson v. Grigson [1974] 1 W.L.R. 228 at 231 in which Davies L.J. said there was an element of truth in counsel's admission that the operation of the section is to some extent in the nature of a blackmailing application.

85. I do not regard the unfortunate use of the word 'blackmail' in that case as indicating anything more than that the wife is entitled to withhold her consent to the husband's application for the grant of a decree absolute without delay until he has made reasonable and fair financial provision for her. If she consents to the application there will be little likelihood that the judge will refuse the application. If the husband fails to make what she considers to be a reasonable proposal she will oppose the application. To this extent therefore some pressure can be applied to the husband. The word 'blackmail' was thus used in a sense different from that in which Mr. Rodway applied it in the present case.

86. Expressed in another way, Mr. Rodway's submission was that section 17A(4) in effect conferred on the wife the right to exploit, with the court's approval, the position in which the husband finds himself. The husband is obliged to make specific proposals that he hopes the court will approve nothwithstanding that it does not, at this stage, conduct a full enquiry into what constitutes fair and reasonable provision. Once the approval is given to those specific proposals, they are irrevocably binding on the husband, even if subsequently the court, on conducting a full enquiry, determines that reasonable and fair provision is less then that made in the proposals.

87. This is a situation very different from that where the wife merely exercises her right not to consent to the husband's application. As a matter of commonsense and justice I do not believe that the legislature ever intended that an applicant for relief under subsection (4) should be forced into the oppressive and totally unnecessary situation which Mr Rodway contends is the consequence of a true construction of the subsection as interpreted in Grigson.

88. In my opinion the plain purpose of paragraph (b) of the subsection is to ensure that the wife is adequately protected in the event that the court concludes that the decree should be made absolute without delay. I am unable to find anything in the section which suggests that the wife should be placed in a more advantageous position in an application under subsection (4) than that which she enjoys under subsections (2) and (3), simply because the husband wishes to expedite the making of the decree absolute in circumstances in which the court considers it desirable that he should be permitted to do so.

89. Although the Court of Appeal in Grigson offered guidance to the profession and to the courts as to the application of subsection (4), it appears to me that their lordships did not have within their contemplation a situation such as that before this court, and that the apparent generality of their observations should be read in the light of the type of factual situation with which they were there concerned.

90. Like Hunter J.A., with whose judgment I respectfully agree, I have great difficulty in reconciling with the words of subsection (4) the view expressed by Buckley L.J. that the words "may approve" in paragraph (b) "do not refer to some time in the future but refer to the moment at which the court is considering whether the undertaking is satisfactory ."

91. The subsection provides that if paragraph (a) is fulfilled and "(b) the court has obtained a satisfactory undertaking from the petitioner that he will make such financial provision for the respondent as the court may approve."(my emphasis), the court may proceed without observing the requirements of subsections (2) and (3).

92. The words "will make" express the future tense. I am unable to think of any sound reason why they should be given an unnatural and restricted meaning, the effect of which would be to confine the operation of the words "may approve" to the time at which the court determines whether the husband's undertaking is satisfactory. Indeed, in the very brief report of B v. B [1974] 118 Sol. Jo. 242 Megaw L.J., in a judgment with which Buckley L.J. and Roskill L.J. (as he then was) concurred, is reported to have said that the section was concerned with the fact that the court must satisfy itself before decree absolute that reasonable and fair financial provision had been, or would be, made. (my emphasis)

93. Mr. Rodway further submitted that the judge erred in finding that circumstances had been shown which made it desirable that the decree should be made absolute without delay. It was, however, a submission that lacked conviction. I agree with Fuad V.-P. that there was ample material before Mayo J. to justify that finding.

94. It is therefore with regret that, for the reasons I have given, I find myself in respectful disagreement with my lord the Vice-President as to the interpretation of paragraph (b) of subsection (4). I am satisfied that Mayo J.'s order has the effect of conferring on the wife the protection that the section requires and that therefore it should be upheld. I would dismiss this appeal.

Fuad, V.-P.

95. The appeal is therefore dismissed by a majority.

96. In handing down these judgments, we make an order nisi that the Appellant shall pay the Respondent's costs.

Representation:

Mr. Gilbert Rodway, Q.C. and Mrs. V.A. Penlington (Denton Hall Burgin & Warrens) for the Appellant/wife.

Miss Jacqueline Leong (Helen A. Lo & Lo) for the Respondent/husband.