CYNTHIA ANNE HONG YEE LEE SHIU v. KALEUNG NMN SHIU

HCMC000003A/1995

HCMC 3/95

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

MATRIMONIAL CAUSES NO. 3 OF 1995

(transferred by F.C.M.C. No. 224 of 1995)

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BETWEEN
CYNTHIA ANNE HONG YEE LEE SHIU Petitioner
AND
KALEUNG NMN SHIU Respondent

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Coram : Deputy Judge Woolley in Chambers

Date of Hearing : 29 November 1999

Date of Handing Down Reasons for Decision : 6 December 1999

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REASONS FOR DECISION

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1. On 12 November 1999 I handed down my decision in this matter when I allowed in part the Respondent’s application for a variationof an order made by consent on 25 March 1996, in respect of the maintenance to be paid by the Respondent for the two children ofhis marriage to the Petitioner. At the same time I dismissed the Petitioner’s application for secured periodical payments or a lumpsum. The parties appeared before me again on 29 November 1999 when I ordered that:

(1) the new order for periodical payments for the children of $13500.00 each should be backdated to 1 April 1999, being the monthafter the application was made;

(2) that the costs of the Respondent’s and the Petitioner’s applications should be to the Petitioner including the costs of the hearingon 29 November 1999;

(3) that the costs of the application by the Petitioner for an injunction, dated 30 March 1999, be to the Petitioner; and

(4) that there be no order as to costs in respect of the Respondent’s application for release of funds.

2. I now give my reasons for the orders as to costs.

3. The starting point, I accept, is as with most applications to the Court, namely that the costs follow the event. But this is onlya starting point, and there are a number of factors which can lead the Court to make other orders in the exercise of its discretion,and I am satisfied that this is such a case.

4. I start with the history of these proceedings, which is set out in my decision, and bear in mind that it was the Respondent’s unilateralreduction of his children’s periodical payments, without an order of the Court or consent of the Petitioner, which set this seriesof applications in motion. He might have made an application to the Court earlier, but chose not to do so until his hand was forcedby the Petitioner’s legal representatives threatening enforcement proceedings in respect of the original order. I also bear in mindthat this was an application to vary the maintenance of his children, and consider that the Petitioner has every right in those circumstancesto ensure that the application is made on genuine grounds and that their interests are protected.

5. In an application to vary, particularly where the original order is by consent, there is a heavy burden on the applicant to justifysuch a variation. In effect he is seeking the Court’s indulgence. Miss Chow on his behalf has said that the stance of the Petitionerin opposing any reduction, and alleging non-disclosure of assets by the Respondent, supports his application for costs, as the hearingmay have not been necessary had her approach been reasonable.

6. However, while the burden was on the Respondent to justify the reduction, and there was a requirement that he make full and frankdisclosure of his means, he clearly did not do that, or not until a very late stage in the proceedings. His letters to the Petitionerwere severely lacking in particulars, and his affidavit in support, when the application was made, still did not contain sufficientdetail to obtain a complete picture of his situation, and in some areas was actually misleading. Miss Chow says that these errorscould have been detected by the Petitioner through earlier letters and affidavits, but I do not consider that it amounts to fulland frank disclosure to require the other side to have to sift through old affidavits and letters to find the truth. The Respondentwas, after all, putting forward a case that his assets had reduced from some $120 million to minus $6 million in a little over threeyears. I cannot criticize the position taken by the Petitioner in requiring him to show convincing evidence of this. As it turnedout, after lengthy investigations by accountants, and attempts by them to resolve discrepancies right up to the beginning of thehearing, his figures were at least $13 million out, and I found that he had assets of at least $7 million. In my view the justiceof the situation requires an order that the Respondent bears the costs.

7. I see no reason to make a different order in respect of the Petitioner’s application for secured payments. In the light of the historyof this matter, she had good cause to fear that her children’s interests were not fully protected, and the only reason that securitywas not ordered was that it was difficult to identify a part of the Respondent’s assets which was suitable for such security andwhich would not prejudice unfairly his own position.

8. In the circumstances of this case I consider it would be wholly wrong to order the Petitioner to pay even her own costs.

9. As to the application by the Petitioner for an injunction, this was made at a time that she had deep and reasonable suspicions asto the Respondent’s intentions, when he was in breach of a court order, and, while making his application for a variation, had soldat least one of his properties. I again cannot criticize the Petitioner for wishing to maintain the status quo pending a decisionby the Court, and had the Respondent made a reasonable offer of a suitable undertaking earlier, I have no doubt that the Petitionerwould have accepted it. The proper order in respect of this application must be costs to the Petitioner.

10. The last matter is the application made by the Respondent for the release of funds covered by his undertaking. He again was askingfor the Court’s indulgence, and at a time when the full picture of his financial position was far from clear. Mr. Coleman for thePetitioner has said that he could not object to our order here for each party to bear their own costs, which is the order I too considerappropriate.

11. Finally I should clarify my order as to the variation of maintenance. That order only varies the amount of the periodical paymentsin the order of Mr Justice Jerome Chan. The other provisions of the part of that order relating to those payments remains the same,in particular that in respect of the annual adjustment in accordance with the Average Consumer Price Index.

(E.T.S.Woolley)
Deputy Judge of the Court of First Instance

Representation:

Mr Russell Coleman instructed by Messrs. Hampton, Winter & Glynn for the Petitioner

Miss Monica Chow instructed by Messrs. Stevenson Wong & Lai for the Respondent