Read the full judgment text of CACV 48/2012 on BabelCite. This Court of Appeal judgment was delivered on 25 March 2013 before Cheung JA, Fok JA, Macrae J.
Family law – ancillary relief – divorce – matrimonial assets – long marriage – discretionary family trust – offshore Jersey trust – Protector's role – 41-year marriage between husband (aged 72) and wife (aged 73) – one surviving daughter K, two deceased children – husband's construction business Analogue Holdings Limited – 84.63% shares settled on Jersey-based Family Trust with HSBC International Trustee Limited as professional Trustee – husband, wife and K as current beneficiaries of discretionary trust – matrimonial assets valued by Judge at HK$1,144.8 million – whether whole of Family Trust or only two-thirds constitutes matrimonial assets – Charman v Charman likelihood test – 'judicious encouragement' disapproved by Court of Final Appeal in KEWS v NCHC – s.7(1)(a) MPPO as sole guide – only two-thirds of trust included as resource likely available to husband – date of separation – estoppel by reason of divorce decree – Hull v Hull principle – s.11C MCO 'living apart' – parties held to have separated in February 2007, not February 2001 – Santos v Santos – Dooris v Dooris – wife continued to perform wifely duties and act as 'corporate wife' until husband left in 2008 – post-separation accrual as basis for departure from equal distribution – Cowan v Cowan – LKW v DD – X v Z and C – rejected – company's net profits grew from HK$25.8M in 2001 to HK$293M in 2010 – not proper basis for departure given 41-year marriage and assets under husband's control – company liquidity as basis for departure from equal distribution – rejected – surplus cash of HK$446M identified by single joint expert Mr Utting of KPMG – HK$227M further increase in bank balances and cash by 2011 – liquidity to be addressed in structure of order rather than by reducing wife's share – wife's request for transfer of Analogue shares rejected as she had not participated in business – equal distribution justified by length of marriage and wife's contribution – half of HK$1,144.8M is HK$572.4M – Judge awarded HK$432M (37.74%) – appeal allowed to that extent – lump sum increased from HK$370M to HK$510.4M – payment by instalments: HK$250M within one month, HK$130M on or before 1 March 2014, HK$130.4M on or before 1 March 2015 – no interest ordered – costs reserved including Trustee's costs
Legal issues: Extent of Family Trust included as matrimonial asset · Date of separation · Post-separation accrual as basis for departure from equality · Company liquidity as basis for departure from equality
Outcome: Wife's appeal allowed in part; lump sum increased from HK$370 million to HK$510.4 million; transfer of husband's half share in 1402 Westland Gardens (valued at HK$7.5 million) to the wife retained
Cites 3 cases