Kcma v. Abc and Others
Read the full judgment text of HCMC 1/2019 on BabelCite. This High Court CFI judgment was delivered on 7 August 2024 before Hon Winnie Tsui J.
Family law – child support – variation of order – material change of circumstances – periodical payments – Matrimonial Proceedings and Property Ordinance – Court of First Instance – Petitioner and 1st Respondent – Children R and S studying in US – Whether material change of circumstances justifies variation – Yes, children leading independent life outside Hong Kong – Whether direct payments commence at 18 or 21 – Yes, at 18 as young adults – Whether rental deduction applies – Yes, $3,333 per child for mother's flat – Application granted in part. Order varied to allow direct payments to children at 18 subject to rental deduction. Father awarded 80% of costs.
Legal issues: Material change of circumstances · Age for direct payments · Rental deduction
Outcome: Application granted in part. Order varied to allow direct payments to children at 18 subject to rental deduction.
Cited by 9 cases · Cites 3 cases
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HCMC 1/2019 [2024] HKCFI 2374 IN THE HIGH COURT OF THE HONG KONG SPECIAL ADMINISTRATIVE REGION COURT OF FIRST INSTANCE MATRIMONIAL CAUSES NO 1 OF 2019 (TRANSFERRED FROM FCMC 15106 OF 2016) ________________________
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________________ D E C I S I O N ________________ The application 1.Before me is an application to vary an order for periodical payments for the three children of the petitioner and the 1st respondent, pursuant to section 11 of the Matrimonial Proceedings and Property Ordinance, Cap 192. In this decision, I shall refer to the petitioner and the 1st respondent as “the mother” and “the father” respectively. 2.The ancillary relief trial took place in May and June 2021. Madam Justice B Chu handed down her judgment in November of the same year: see [2021] HKCFI 3392. Following the handing down of the judgment, there was a further contested hearing which resulted in a further order made on 24 January 2022 (“the Order”). 3.We are today concerned with para 6 of the Order which read:
4.By summons dated 8 February 2024, the father now seeks changes to that paragraph such that instead of making the payments via the mother, he would pay the monthly sum of $20,000 directly to each of the children when he or she turns 18 years old and has his or her own bank account. 5.I note that in the summons, the father asked for the variation to take effect after the date when the order is made. However, in his written submissions, Mr Harprabdeep Singh, counsel for the father, states that the father would now ask for the variation to take effect commencing from after the date of the summons. The outstanding issues 6.What immediately stands out in this variation application is that the variation sought does not concern the quantum of the periodical payments. The variation concerns only the mode in which those payments should be made. 7.The core difference between the parties is that the father would want the payments to be made directly to the children, whereas the mother wants to stick to the original arrangement under the Order and have those payments made to her in the first instance. 8.At a hearing before me in May this year when I dealt with the mother’s time extension application for the filing of her opposing affirmation, I urged parties to settle the matter because on its face, the application appeared to me to be a straightforward one and it is certainly not worth the time, efforts and trouble for the parties to engage in a full-blown argument. 9.Since then, there has been proposal and counter-proposal made by each side. But they have not been able to settle the matter fully. As things stand now, there are three issues remaining which, once decided, will resolve the application fully. 10.The first issue is whether there has been any material change of circumstances between the date of the Order and now which justifies a departure from the arrangement made under the original order. The mother’s position is that there has been no such material change. If I am with her on this point, I should dismiss the father’s summons. But if I am not with her, then the mother’s position (as made clear by Ms Bonnie Cheng, her counsel, this morning) is that I may then order that the periodical payments be made directly to the children subject to the second and third issues. 11.Under the second issue, the mother’s position is that the direct payments to the children should only commence at the age of 21 as opposed to 18 which is contended for by the father. So it is an issue of “18 versus 21”. 12.Under the third issue, the mother’s position is that the direct payment to each child should be subject to a deduction of $3,333. That sum was specifically provided for in the ancillary relief judgment as representing each child’s share of the rental for the mother’s flat in Hong Kong. The mother and the three children have been residing in that flat since 2017. Legal principles 13.There is no dispute between the parties as to the general principles which I should follow in determining this variation application. Both counsel refer me to the Court of Appeal decision in AEM v VFM [2008] 3 HKLRD 36. I consider that paras 14.4, 14.6 and 14.8 are of particular relevance to the present application. The principles are as follows. 14.The approach that the court should adopt, as required by section 11(7), is to consider all the circumstances of the case (para 14.4). Almost invariably, an application to vary an earlier periodical payment order will be brought “on the basis that there has been some changes in the circumstances since the original order was made” (para 14.6). The basis and intended effect of the original order are relevant factors that should be taken into account (para 14.8). The first issue 15.Both counsel have crafted the issue to be whether there has been a material change of circumstances since the date of the original order. I note, however, that in authorities such as AEM, the word “material” was not used. As I have just read out, in AEM (para 14.6), Mr Justice Cheung referred to “some changes in the circumstances”. In fact, in the ancillary relief judgment, her Ladyship said at para 592:
16.Similarly, Madam Justice Chu also simply referred to “change of circumstances” rather than “a material change of circumstances”. 17.In these references to “change of circumstances”, I think it is clear that the phrase does not cover any change of circumstances. The change must be of a sufficient degree that would warrant the court revisiting the original order. 18.Analysed that way, it may not be very different from the phrase or the concept encapsulated in the phrase “material change of circumstances”. Given counsel’s formulation in this application, I will proceed to apply the test of “material change of circumstances”. 19.I accept the father’s submission that there has been a material change in the children’s circumstances. 20.At the time of the ancillary relief trial in 2021 and when the Order was made in January 2022, R had just turned 18, attending the final year of high school in Hong Kong. S and A were about 16 and 12 at the time. 21.Now R is 20 years old, about to turn 21 in the coming October. He attends [name omitted] University in the US. He lives in campus housing. He has his own bank account. Since he left for college in the US in July 2022, he has only returned to Hong Kong for a few weeks in the summer of 2023. He did not come back to Hong Kong during the following school year. For this summer, he is only staying here for about two weeks. It is therefore a good time to consider whether he should be given the opportunity to manage his finances. 22.As for S, she recently turned 18. She is going to attend college in the US. For the majority of the coming school year, she will no longer reside in the mother’s flat in Hong Kong. 23.As for A, there has not been any significant change in her circumstances. 24.Given the above, objectively speaking, there is plainly a change in the circumstances of R and S in that they are now or will soon be leading an independent life outside of Hong Kong, away from home and without the day-to-day care of the parents. This is a milestone stage of their lives and this, in my view, warrants the court looking into how the periodical payments should be made to serve the best interests of the children. 25.On this point, the mother takes an opposite view. Ms Cheng argues that there has been no material change of circumstances because it has always been in the contemplation of the parties that the children would pursue their university studies in the US. 26.Ms Cheng refers me to the Form E filed by the father in January 2021 in which he set out his proposed arrangements for the three children to attend university or boarding school overseas. Ms Cheng also refers me to some passages in the ancillary relief judgment, in particular para 588, where her Ladyship stated that the parties’ agreement had been for R to attend university in the US and that S had also expressed her wishes to attend boarding school there. 27.On that factual basis, Ms Cheng submits that the agreement of the parents and their knowledge formed the basis upon which her Ladyship ordered the periodical payments to be paid by the father directly to the mother for the support of each of the children until he or she completes full-time education or further order. 28.In the ancillary relief judgment, the judge dealt with the needs of the children at paras 585 to 592. Based on an objective reading of those paragraphs, it is plain to me that the judge’s focus was on the amount of the periodical payments but not the mode in which these payments should be made. Those paragraphs are grouped under the section which is entitled “The Children’s reasonable needs – Issue 3”. At the end of the judgment, in para 611(2), the judge directed that the father should pay to the mother the children’s periodical payments. But I think it is fair to say that while it was fully anticipated or contemplated by the parties and the court that the children would be studying at some point in the future in the US, the issue of mode of payment was not at the forefront of the court’s mind. It was anticipated, but it was not dealt with or addressed in any level of detail. 29.I am given to understand at this morning’s hearing from both sides that in fact the mode of payment was not discussed or ventilated at all either at the trial or at the subsequent contested hearing in January 2022. That is perhaps not surprising because if we cast our mind back to that timeframe, R was just barely 18 and the two daughters were in their teens. In such cases, it is not surprising that the court would order the periodical payments to be made to the mother and then for the mother to deal with the expenses of the children as the children were all very young. 30.As I understand it, Ms Cheng’s opposition is as follows. If the plan to study overseas was expressly contemplated and if that factor had been taken into account by the court when it made the order of periodical payments, then it would not be right for any of the parties to come back later to challenge or vary that order when that plan materialised. I can understand that argument. In those circumstances, there is much to be said that there should be finality to an order. 31.However, that is not the case here. In the present case, at the trial in 2021 and at the contested hearing in January 2022, this point regarding the mode of payment was never discussed and the ultimate order, as I understand it, was not made based on any argument on this issue. Hence, the objection does not apply here. 32.In the circumstances of the present case and for the purpose of this variation application, I therefore hold that there has been a material change of circumstances which justifies the court revisiting the issue of the mode of payment. 33.Ms Cheng refers to the Family Court decision in Z, G v PZ, N nee P, N [2022] HKFC 234. I do not consider that the decision is directly on point here. As Mr Singh points out, the judge’s refusal to make a variation is based on a number of reasons which do not apply in the present case: for instance, see para 1 (the order in that case being a consent order), para 58 (the variation application being concerned with the issue of quantum), and para 65 (the judge’s view that the father there was simply “re-writing almost each and every paragraph of the 2019 Consent Order and proposing fresh undertakings as he wishes”). These considerations do not feature at all in the present application. 34.I should add that in the ancillary relief judgment, Madam Justice Chu specifically and expressly said at para 592 (quoted in para 15 above) that as regards any future education plans, they would have to be agreed by the parties and “there will be change of circumstances”, and she expected the parties might need to come back to the court when the time comes. 35.To conclude, there has been a material change of circumstances in relation to R and S. It is therefore open to the father to come to the court to revisit the mode of payment of the periodical payments to cater for the changing needs of the children. That would warrant the court considering exercising the power to vary the previous order and considering how to exercise that power. The second issue 36.I would accede to the father’s request that the direct payments to the children commence from when each child turns 18 rather than 21. In my view, the short point here is that at 18, the children are young adults and they should be treated as such. I accept that at this age, they should bear the responsibility, or they should be given the opportunity to bear the responsibility, of managing their financial affairs. 37.I also accept the father’s submission that it is a chance for the children to build up their personal creditworthiness in the US and this would be conducive to their later on obtaining, for instance, credit cards, mortgages and other potential employment opportunities in the States. 38.It is the mother’s evidence that the children are not mature enough to handle the payments by themselves. She is of the opinion that we should wait till they turn 21. By then, they will have obtained a higher maturity level. She has also adduced evidence suggesting her concerns that there might be issues of overspending in the case of S. 39.I have reviewed the evidence. I conclude that there is nothing in the evidence which suggests to me that it is undesirable for the children to be given the opportunity to start handling their own finances at the age of 18. Of course I would accept that if we wait till 21, they will be more mature, given the time lapse and given the fact that they will be studying in university in those intervening years. But I am satisfied that it is suitable to give them a chance to handle their own financial affairs at the age of 18. The third issue 40.I would allow the deduction of $3,333, as suggested by the mother. This sum was expressly provided for in the ancillary relief judgment as each child’s share of the rental for the mother’s flat in Hong Kong. It was expressly contemplated that that sum should come out from the monthly payment of $20,000. In other words, that share was to be borne by each of the children and should come out from the pot of $20,000 each month. 41.It is correct that for R and S, they will be spending the majority of their time outside of Hong Kong because they are studying in the US. But while they remain full-time students, I think it is reasonable for the mother to maintain the rooms for them in her flat in case they want to come back to Hong Kong, say for instance during holidays. 42.In fact, in today’s hearing, Mr Singh accepts that the children should be given a choice to stay at the mother’s place should they so wish. In this regard, I therefore reject any assertion in the father’s affidavit evidence that R has permanently left Hong Kong. In fact, the situation for S may be different. She is only starting this August in the US. It is not certain how often she will come back to Hong Kong during her holidays. 43.The judgment expressly provided for a budget of $70,000 for the mother to rent a flat on the south side of Hong Kong Island. Within this sum, $60,000 was to be borne by the mother and $10,000 to be shared by the three children. Given my view that it is reasonable for the mother to provide rooms for the three children even though they may not reside for a long period of time in Hong Kong, it is only fair for the mother to keep the sum of $3,333 as each child’s share of the rental. 44.It would then be a matter between the mother and the three children as to how to deal with the contention or suggestion that the children should not bear the full share given that they spend most of the time outside of Hong Kong. But it is not a matter that I would concern myself with in the present application. 45.I should add that the father did offer an undertaking to allow the children to stay at his place of residence when they do come back to Hong Kong. But I do not think that is a replacement of the option for the children to stay at the mother’s flat. The mother and the three children have been staying in the flat since 2017. I think we should keep the status quo to the extent that we can. 46.I have now dealt with the three outstanding issues. I would just add one more point. There are many factual disputes revealed by the affirmations filed by both sides. I do not find it necessary to deal with these factual disputes because in my view, they are not relevant to the issue of variation. Some of those factual disputes concern the conduct or the behaviour of the father and the mother in terms of the access issues. I do not need to resolve them in order to deal with the present variation application. I would say no more about these factual disputes. Conclusion 47.I am of the view that the periodical payments should be made directly to the children when they turn 18, when they study in university and when they have their own bank accounts, but the payments should be subject to a monthly deduction representing each child’s share of the rental paid for the mother’s flat in Hong Kong. 48.I reject the father’s suggestion that the variation should take effect immediately after the date of the summons. That is not what was asked for in the summons. From an enforcement point of view, if I acceded to the father’s suggestion, I would need to know precisely how much, if at all, the mother had withheld the monthly sum from the children. 49.That has not been asked for in the summons and the mother did not have the chance to address these issues in her opposing affirmation. Therefore I do not think that it is proper for me to make an order with the variation taking effect from after the date of the summons. 50.Parties have handed up a draft order. I would make an order in terms of paras 1, 2 and 3 of that draft, namely:
(Submissions re costs) 51.I am going to take a broad view on the issue of costs. In my view, the main crux of the variation application had been, until May 2024, whether the periodical payments should be made directly to the children. The father has succeeded on this core issue. On the other hand, he has failed on the issue of rental deduction. 52.Furthermore, parties have engaged in producing evidence on factual matters which are not directly relevant to the present variation application. That type of practice should be discouraged. Hence, a deduction should be made from the father’s costs even when I consider that he is in effect the overall winner as far as the substance of the application is concerned. 53.These are my costs orders:
Ms Bonnie YK Cheng, instructed by Stevenson, Wong & Co, for the petitioner Mr Harprabdeep Singh, instructed by YTL LLP, for the 1st respondent | |||||||||||||||||||||||||||||||||||
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