BKSH nee KSH v. JAB

FCMC 5366/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 5366 OF 2008

------------------------

------------------------

-----------------------

J U D G M E N T
(LEAVE TO APPEAL)

------------------------

1.  This is a hearing of the Respondent’s application for leave to appeal against my Judgment dated 14 October 2016 (“the Judgment”).   For the sake of convenience, I shall continue to call the Petitioner “the wife” and the Respondent “the husband” in this Judgment.

Brief History

2.  The wife is now aged 52 and the husband is aged 66.

3.  They were married in 1994 but divorced in 2008/2009 (Decree Nisi in 2008 and Decree Absolute in 2009).   This was a marriage of at least 14 years.

4.  Within this marriage, they have 2 children, now aged 21 and 19 respectively.  Both of them are now studying in England.  

5.  Subsequent to the divorce, all parties were relocated to England.  The wife used to live with the children at the house under the parties’ joint names at 45 Trefusis Road, Glensilva, Flushing Falmouth Cornwall, TR 115UB (“the house”).  I understand that both children have now moved away to live at university accommodation leaving the wife staying there by herself.

6.  The husband and his new family now reside at Plymouth which I believe is also somewhere in South West England, a city not too far away from the house.

7.  Back in 2009 and 2010, the parties entered into 2 agreements settling their ancillary relief applications, resulting in the orders of 19 November 2009 (“the 1^st AR Order”) and 9 August 2010 (“the 2^nd AR Order”).  The 2 orders were in quite some details providing for, inter alia, the sale of the house, the establishment of an education fund for the benefit of the children, the payment for the children’s maintenance, the equal sharing of the sale proceeds and the payment of certain lump sums from the share of the husband.  It may not serve any useful purpose by repeating all the terms of the 2 orders but their combined effects have been summarised at §18 of the Judgment.  I would repeat my findings herein for ease of reference:

“18. It is my ruling that the combined terms of the 1^st AR Order and 2^nd AR Order are:

(1) The husband shall pay a monthly sum of HK$30,000 as maintenance for the 2 children, ie. HK$15,000 each, starting from 1 December 2009 until the sale of the house, the distribution of the sale proceeds and the establishment of the Education Fund and thereafter, the maintenance are to be increased to HK$34,000 per month (ie. HK$17,000 each): §3 of the 1^st AR Order.

(2) The payment of the children’s maintenance shall last until the children attaining the age of 18 or finishing their full time education, whichever is the latter: §6 of the 1^st AR Order.

(3) The house is to be sold as soon as possible at a price not less than £2.35 million or at such price to be agreed by the parties: §1 of the 2^nd AR Order.

(4) After the payment of all reasonable outgoing and expenses, a sum of HK$3,000,000 will be deducted from the sale proceeds to establish an Education Fund out of which the school and university tuition fees of the children will be paid.  If the Education Fund should not be exhausted at the end of the day, the balance will be shared between the parties equally: §2 of the 1^st AR Order.

(5) The net sale proceeds will be shared between the parties equally but subject to the following payments to the wife from the husband’s share: §4 of the 1^st AR Order:

(i) In the event that the husband shall fail to pay the children’s maintenance, such arrears will be deducted from the husband’s share of the net sale proceeds: §2 of the 2^nd AR Order.

(ii) A sum of US$186,851: §4 of the 1^st AR Order and §3(a) of the 2^nd AR Order.

(iii) The total of the monthly sum of HK$11,000 (representing the difference between HK$41,000 and HK$30,000) calculated from 1 July 2010 until the receipt of the sale proceeds: §5 of the 1^st AR Order and §3(b) of the 2^nd AR Order.

(6) The solicitors or the agent handling the sale shall deduct the above sums from the husband’s share and paid over to the wife: §4 of the 2^nd AR Order.

(7) The above terms are in full and final settlement of the parties’ respective claim for ancillary relief, except for the maintenance of the children: §7 of the 1^st AR Order.”

8.  Despite the said 2 orders, the anticipated sale of the house did not materialise with the husband alleging non-cooperation on the part of the wife.  Therefore, the husband issued 2 new applications in 2016, one for further ancillary relief and one for “ORDER OF ENFORCEMENT”.  The details of the relief sought were summarised at §§3-5 of the Judgment which are, again for ease of reference, repeated herein:

“3. The first application of the husband was an application for ancillary relief in which he asked for:

“1. Resolution of the amount of past maintenance to be deducted from the sale of the house

2. Resolution of the amount of upkeep charges of the family home to be paid by either party

3. Variation of ongoing maintenance

4. Variation in the “Education Fund”

5. An order for [the wife] to pay [the husband] half of her accommodation costs since September 2014

6. Leave to enforce the order in the UK

7. Costs”

4. The second application was a summons for “ORDER OF ENFORCEMENT”.  I shall not repeat the wordings of the summons in verbatim as they contain some unnecessary narration of facts.  As I understand it, the husband is asking for the following orders:

(1) The house in England (which is registered under the parties’ joint names and at 45 Trefusis Road, Glensilva, Flushing Falmouth Cornwall, TR 115UB England)(“the house”) with its furniture and fittings are to be sold by private treaty through an agent called “Lillicrap Chilcott” (“the estate agent”) at a price to be first decided by the estate agent representing the market value. The estate agent is authorised to accept any offer which is no less than 5% below the said price.  If the house is not sold within 3 months, it should then be sold by auction with a reserved price of £1.5 million and that the estate agent is to be paid an agent fee of 3% of the sale price.  If the auction fails, the estate agent should advise the court on how to achieve the sale of the house.

(2) The personal and private effects should be distributed to the parties by agreement failing which a removal expert called “Britannia Lanes of Cornwall” is to be appointed to make a full inventory and store the items pending further order of the court.

(3) The appointment of the firm of “Foot Anstey” to represent the parties in the sale of the house and after the deduction of all necessary outgoings, each party should be paid a sum of £250,000 with the balance to be put in the firm’s clients’ account pending agreement on the deductions in the order dated 9 August 2010 or further order of the court.

(4) The wife to comply with all reasonable requests from the estate agent to facilitate the sale of the house.

(5) That leave is to be granted to apply to the UK Courts for enforcement of the order.

(6) Costs to the husband.

5. One will notice that the husband’s 2 applications concern with 2 important basic issues, one concerning the sale of the house and the other the children’s maintenance.”

9.  After hearing the husband’s applications for 2 days (on 1-2 September 2016), I handed down the Judgment giving detailed orders for the sale of the house, deduction from the share of the husband’s sale proceeds to provide for the needs of the children and other lump sums due to the wife (at §60 of the Judgment).  Those orders are:

“60. The orders to be made are:

(1) For the sale of the house:

(i) The house is to be sold by private treaty at or above the reserved price of £2,350,000 within 6 months of the order.

(ii) If the house cannot be sold by private treaty within 6 months, such sale should be effected by public auction with a reserved price of £1,500,000 within 4 months thereafter.

(iii) Lillicrap and Chilcott is to be appointed as the estate agent to conduct the sale.

(iv) The estate agent is to be paid an agent fee of not more than 3% of the sale price.

(v) The solicitors firm of Foot Anstey is to be appointed as the handling solicitors for the sale.

(vi) After the deduction of all reasonable and necessary outgoings and expenses of the sale, the net sale proceeds should be divided between the parties in equal shares, but subject to deduction from the husband’s share as set out in the following paragraph.

(vii) The parties’ personal and private effects in the house are to be distributed between the parties by agreement, failing which the removal specialist of “Britannia Lanes of Cornwall” should make a full inventory and store the same in their warehouse pending further order of the court.

(2) The following sums should be deducted from the husband’s share of the net sale proceeds by the handling solicitors and paid over to the wife:

(i) HK$2,350,000 as the maintenance for the 2 children as from 1 December 2009 to 30 September 2017.

(ii) HK$1,020,000 being future maintenance for the children as from 1 October 2017 to 31 August 2020.

(iii) £35,000 being the husband’s half share of the children future university tuition fees.

(iv) HK$946,000 being the difference between HK$41,000 and HK$30,000 as from 1 July 2010 to 30 September 2017.

(v) US$186,851.

(3) This order is in place of the 1^st AR Order and the 2^nd AR Order.”

10.  After the handing down of the Judgment, the husband issued a summons on 6 January 2017 asking for leave to appeal.  It seems that the husband’s application was out of time but as he explained in his affidavits and oral submissions, the delay was caused by the fact that he was now residing overseas and had to conduct the proceedings on a long distance basis.

11.  As the delay was not too serious and the wife being absent and thus raising no objection on this issue, I accepted the husband’s explanations and allowed him to proceed with his application for leave to appeal even though it was technically out of time.

The Law

12.  Leave to appeal is governed by s. 63A(2) of the District Court Ordinance, Cap 336 which reads:

“(2) Leave to appeal shall not be granted unless the judge, the master or the Court of Appeal hearing the application for leave is satisfied that-

(a) The appeal has a reasonable prospect of success; or

(b) There is some other reason in the interests of justice why the appeal should be heard.”

13.  As to what constitutes a reasonable prospect of success, it has been held that the prospects of succeeding in the intended appeal must be “reasonable” and therefore more than “fanciful”, but without having to be “probable”: SMSE v KL[1].

Grounds of Appeal

14.  The husband has filed a 13-page “GROUNDS OF APPEAL” on 6 January 2017 (containing 60 paragraphs) and a 7-page “FURTHER GROUNDS OF APPEAL” on 16 January 2017 (containing 11 paragraphs and a 2-page table of calculations).  I do not propose to repeat all the husband’s grounds of appeal in verbatim but would summarise and comment on them in the following discussion.

Overall effects of the Judgment

15.  In the Judgment, I ordered that the house is to be sold by private treaty at the reserved price of £2,350,000 within 6 months, failing which the sale should be effected by way of auction at the reserved price of £1,500,000 within 4 months thereafter. 

16.  The gist of the husband’s complaints is that too little money would be left to him after the sale of the house.   His calculations are that if the house was to be sold at £2,350,000, only a sum of £417,894 would be left to him.   If the house was to be sold at £1,500,000, an even less amount of £5,644 would be left to him. 

17.  The husband further complains that this court has failed to take into account the 2 children of his new family when arriving at its conclusion.

My views

18.  I have already made clear at §20 of the Judgment that an important feature of this case is that by the 1^st AR Order and the 2^nd AR Order (made in the years of 2009 and 2010), the parties have already reached a full and final settlement on the sale of their major family asset, namely the house, and on the division of the sale proceeds, subject only to provisions being made for the 2 children’s future maintenance and education and certain lump sum payments to be made to the wife.  The main purpose of the Judgment was to give further directions on how the 1^st AR Order and the 2^nd AR Order are to be carried out.  This court should not and will not rewrite the terms of the parties’ settlement.  

19.  As to the amount of money that the husband would get after the full implementation of the 1^st AR Order and 2^nd AR Order, I note that both parties agreed for the sale price to be set at £2,350,000.  As to the reserved price of £1,500,000 in case of auction, it was actually a figure suggested by the husband himself.  Therefore, there should not be any complaint for the sale price or reserved price to be set at those levels.

20.  Under these circumstances, even if the effects of the carrying out of the 2 orders would place the husband in a financially difficult position, it is not within this court’s power to give the husband a better deal, so to speak, after the parties reaching their final settlement some 8 years ago.

21.  I am aware that in the husband’s other submissions, he has attacked other aspects of the Judgment which may merits further discussion (which will be done in the latter part of this judgment), but I am not convinced that the effects of a judgment, reflecting the full and final settlement of the parties’ disputes some years ago, can on its own justify a variation of the settlement reached and thus justifying leave to appeal to be granted in the case.

Jurisdiction

22.  The second ground of appeal is on jurisdiction.

23.  I think the husband’s complaint is that I should have granted an adjournment for him to apply for legal aid in order to argue on the issue of jurisdiction.

24.  I note that the husband’s application for adjournment was only made during his final submissions at the second day of trial.  By that time, all the evidence has been heard.  It was simply too late for such an application.

25.  Furthermore, even up to the date of this hearing, the husband has made no submission on how the court’s refusal to grant such an adjournment was being prejudicial or unfair to him. After all, even the husband accepts that the Judgment is unenforceable in the UK (see §10 of the husband’s “GROUNDS OF APPEAL”).  I am not in a position to say whether this is right or not as there was no expert evidence on this point at trial.  But if the Judgment is accepted to be unenforceable in the UK, this court’s refusal to grant leave to the husband to enforce the orders in the UK (at §58 of the Judgment) must be right.   Therefore, I simply do not see there being any reasonable prospect of success on this ground of appeal.

26.  In §5 of the husband’s “FURTHER GROUNDS OF APPEAL” dated 16 January 2017, the husband attempted to make further submissions on the law of forum, which I believe has added nothing of substance to the husband’s intended appeal.

Financial Dispute Resolution (FDR)

27.  The husband complains that a FDR Judge should not proceed to hear his application for variation.

28.  I trust that the husband must be relying on the recent Court of Appeal case of AB aka ABW v MAW[2] in which the Court of Appeal has stated that a FDR Judge should have no further involvement on matters concerning the ancillary relief application.

My views

29.  First of all, it has to be noted that the Reasons for Judgment of the case of AB was handed down on 1 December 2016, which was after I have handed down the Judgment on 14 October 2016, meaning that I did not have the benefit of the guidelines on the role of a FDR Judge as laid down by the Court of Appeal in that case.

30.  Furthermore, according to court records, there had never been any formal FDR hearing being fixed.   On 19 November 2009, before the 1^st AR Order was made, that hearing was originally fixed for the trial of custody, which issue was later settled by the parties at the hearing.   In seeing that there was time left in the day, the parties were encouraged to consider settlement of the issue of ancillary relief as well.   Therefore, it was not like an ordinary FDR hearing in which without prejudice correspondence were exchanged or disclosed well before hand. 

31.  One also has to bear in mind that the discussion of settlement was done more than 7 years ago when all parties were still working and residing in Hong Kong.  Their then circumstances, be they financial or otherwise were completely different from now.  Therefore, not only that the contents of the discussion (if any) were not in my memory, but even if they were, I do not think they are of any relevance to the husband’s present applications.

32.  Lastly, it also has to be pointed out that the main focus of the trial was on the sale of the house. The variation of the children’s maintenance was only a secondary issue.   I do not consider the fact that I had presided over the parties’ discussion of settlement over 7 years’ ago would have any prejudicial effect on the husband’s present case at all. 

Resolution of amount of past maintenance

33.  In §§14 to 16 of his Grounds of Appeal, the husband is arguing that after the establishment of the Education Fund, the amount of maintenance for the children should be reduced.

34.  I was unable to read this into the terms of the 1^st AR Order and 2^nd AR Order.

35.  In §18 of his Grounds of Appeal, the husband “appeals for clarification”.  I see nothing to be clarified and certainly the Court of Appeal is not a proper place to seek such clarification.

Failure to take account of changed circumstances prior to application

36.  In §§19 to 24 of his Grounds of Appeal, the husband argues that the living costs is much lower in England than in Hong Kong and therefore, the maintenance for the children should be reduced after their relocation to England.

37.  In this regard, I must point out that in §§52 to 56 of the Judgment, after making allowance for past school fees being paid by the husband, I have ruled that a sum of HK$2,350,000 to be deducted from the husband’s share of the sale proceeds being all the arrears of maintenance owed up to the sale of the house.  This sum was in fact smaller than the sum of HK$2,535,200 being accepted by the husband as arrears of past maintenance calculated up to 29 February 2016 (see §20 of the husband’s affidavit dated 7 March 2016, p.16 of the Trial Bundle).   I therefore see no substance in the husband’s complaints on this ground.

Failure to take into account the husband’s reduced income prior to trial

38.  The husband complains that this court has failed to take into account the parties’ changed circumstances prior to trial.  But if one should read §33 of the Judgment, it is clear that this court has already taken the husband’s case on changed circumstances into consideration before arriving at its conclusions.  In §35, I accepted the figures as put forward by him representing his then financial situation.  I accepted that his only income was mainly from a small state pension of £643 per month. Therefore, it is untrue to say that the lack of regular income from his former employer has not been taken into account by this court.

Failure to take into account holiday payments made by the husband

39.  The husband complains on the court’s refusal to deduct the holiday expenses that he has paid on behalf of the children from the arrears of maintenance.

40.  First of all, the husband has a duty to prove his case including the actual amount of the expenses.   The husband has produced no such evidence. 

41.  Second, and even more importantly, there is no agreement in the parties’ settlement that those expenses have to be deducted from the children’s maintenance.   If the husband should decide to spend holidays with the children, and without any prior agreement from the wife for such reimbursement, I think it is unfair for those holiday expenses to be deducted from the children’s maintenance.

42.  I am not persuaded that the husband has any merits in this complaint.

Appeal against incorrect deduction of maintenance already paid by the husband

43.  The husband complains that there is an error in the deduction of past maintenance already paid by the husband.  He said he has already made part of those payments to the wife.

44.  At §22 of his supporting affidavit (at p.19 of the Trial Bundle), the husband only said:

“I have paid a total of HK$942,581.50 in school fees (as set out in the following list) that can be counted towards maintenance…”

There was never any evidence showing that he has made any or part of those payments directly to the wife.   As I was of the view that the school fees should have been paid out of the Education Fund, meaning that the parties were to share those school fees equally, that was why this court allowed half of those school fees paid by the husband to offset part of the outstanding maintenance.

Appeals against order for future maintenance

45.  The husband complains that I have failed to properly calculate the future maintenance in that I should not have taken the husband’s capital into account.  He said maintenance should be based on income only.

46.  I am afraid the husband has adopted a wrong approach: see s. 7(2) of the Matrimonial Proceedings and Property Ordinance, Cap. 192 (“MPPO”). 

47.  In §59(3) of the Judgment, I have ruled that the sums of HK$4,316,000, £35,000 and US$186,851 (equivalent to about HK$6,100,000) should be deducted from the husband’s half share of the sale proceeds.   If the house is to be sold at £2,350,000 (which is a figure agreed by both parties), the husband’s half share would be about £1,175,000 (about HK$12,000,000 at the exchange rate of 1:10.20 then prevailing). After deduction, the husband would still have a sum of about HK$5,900,000. That was why I said at §40 of the Judgment that after the deductions, the husband would still have a not insubstantial amount of money left to him.

48.  The husband further submits (at §38 of his Grounds of Appeal) that the children’s maintenance should be set at a lower rate as the living standard in the UK is much lower than in Hong Kong. 

49.  I note that the monthly maintenance table at §38 was not produced as evidence at trial.  For example, under the item of “Food” which was set at £150 for each child, I cannot find the same at p.12 of the Trial Bundle.  In any event, those figures are not supported by any documentary evidence and therefore, it is difficult to come to a conclusion that the living standard in the UK must be lower than in Hong Kong. 

50.  Furthermore, even if the UK living standard is really lower, which I believe may be true as far as accommodation is concerned, one must bear in mind that the children are adults now (aged 21 and 19).   The allowance for food at £150 seems to be unacceptably low.   At the exchange rate of say, 1:10, £150 is equivalent to HK$1,500 only. I do not believe that it is reasonable for the children to rely on a food allowance of HK$1,500 per month only, ie HK$50 per day, in view of the capital retained by the husband after the sale of the house.  Therefore, I am not satisfied that the husband to have any reasonable prospect of success in this area of his submissions.

Duty of the Court to consider all the children of the husband

51.  From §§40-44 of the husband’s Grounds of Appeal, the husband complains that this court has not taken the needs of his new family, in particular, the needs of the 2 children born out of another relationship/marriage into consideration. 

52.  At §39 of the Judgment, I did say that when the parties reached their settlement in 2009 and 2010, the new children of the husband were already born and therefore, they cannot be regarded as a new circumstance.  In other words, when the husband agreed to the terms of settlement, he was well aware of the then and future needs of these 2 new children.  I therefore maintain my view that the needs of the husband’s 2 new children are not new circumstances.   In any event, as I have ruled that the husband would still retain a not insubstantial amount of capital after distribution, I am not convinced that the maintenance for the 2 children of this marriage should be adversely affected.

Appeal against capitalisation of maintenanceand immediate payment of future education fees

53.  At §§45-55 of his Grounds of Appeal, the husband complains about the award of a lump sum for the children’s future maintenance and payment of their future education fees.  He said there are possibilities that the elder child may not return to his medical studies and the younger child may not be able to finish his university education.  He said he would not object to the creation of a maintenance fund to be held jointly by the parties to pay for the children’s future maintenance and education fees.

54.  Apart from the fact that the husband has not made such an offer of establishing a maintenance fund at trial, I think the probability for the children stopping full time education in the coming 3 to 4 years is quite small.  Therefore, it is fair to allow maintenance (including their education fees) for the children until the time they are supposed to finish their first university degree.

55.  As I have stated at §45 of the Judgment, in view of the husband’s claim of impecuniosity, it was fair to make a lump sum order in respect of the children’s future maintenance so as to achieve something akin to a clean break.  At §49 of the Judgment and in order to simplify the matter, I also came to the view that a sum of £35,000 should be deducted from the husband’s share of the sale proceeds instead of maintaining the Education Fund which was originally agreed at HK$3,000,000.  I still maintain that should be the right approach and I do not believe the husband has any reasonable prospect of success in overturning that conclusion.

Appeal against the wife free use of the house

56.  In §§56-60 of his Grounds of Appeal, the husband complains that I should not have ruled that the wife needs not pay for her residence at the house as from September 2014.

57.  First of all, I note that the wife and at least one of the children were relocated to the UK and started to live at the house since September 2014.  There was no evidence to suggest that the house had been rented out before the wife and the child’s occupation.  Therefore, it is difficult for the husband to argue that the wife’s occupation of the house has caused a loss of rental income.  After all, it was the parties’ agreement that the house should be sold and any tenancy created would not be conducive to such a sale. 

58.  Second and more importantly, I think there is no dispute that the husband has failed to pay the maintenance as agreed under the 1^st AR Order and 2^nd AR Order.   Without such maintenance, where else the wife and the child could have stayed, if not at the house.  Therefore, I do not see there being anything wrong for the wife and children to occupy the house since September 2014.   Equally, I do not see the husband as having any reasonable prospect of success on this ground.

Effects of capital gains tax on the Judgment

59.  In §§ 1-4 of his “FURTHER GROUNS OF APPEAL” (dated 16 January 2017), the husband has made further submissions on the effect of UK’s Capital Gains Tax on the amount of capital that he would get after the sale of the house. 

60.  I note that the husband has never argued or produced any such evidence at trial and it would be too late for him to do it now.   Furthermore, even if Capital Gains Tax is to be levied, it would not only affect the husband, but the wife as well.   In other words, not only that the husband will get a smaller sum after the sale, but so will the wife.  As I have stated in §§18-20 above, one of the main purposes of the Judgment was to give effect to the sale which was already agreed back in 2009 and 2010. There is no room for rewriting the parties’ agreement, as far as the sale of the house is concerned.  Therefore, I am not convinced that the payment of Capital Gains Tax in the UK, if any, will justify leave to appeal to be granted in this case.

Maintenance Quantum

61.  In §§6-11 of the his “FURTHER GROUNDS OF APPEAL”, the husband has made lengthy submissions on the English laws on children maintenance, which is irrelevant to my Judgment which was based on Hong Kong laws.  Simply put, I do not regard the husband’s submissions will have any reasonable prospect of overturning the rulings in the Judgment.

Conclusions

62.  Based on the above discussions, I am not satisfied that the husband has any reasonable prospect of success in his intended appeal and there being no other reasons in the interest of justice that leave should be granted, I refuse to grant leave to appeal and the husband’s summons dated 6 January 2017 is to be dismissed.

Costs

63.  The wife did not appear at the hearing and I shall therefore order that there be no order as to costs. This will be in the form of an order nisi, to be made absolute upon the expiry of 14 days from the handing down of this judgment.

FCMC 5366/2008

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MATRIMONIAL CAUSES NO. 5366 OF 2008

------------------------

------------------------

-----------------------

J U D G M E N T
(Sale of Property and Variation of Maintenance)

------------------------

Applications

1.  This is a hearing of the Respondent’s 2 applications both dated 7 March 2016.

2.  Despite the fact that the parties were divorced quite some time ago, I shall continue to refer to the Petitioner as “the wife” and the Respondent as “the husband” in this judgment purely for the sake of convenience.

3.  The first application of the husband was an application for ancillary relief in which he asked for:

“1. Resolution of the amount of past maintenance to be deducted from the sale of the house

2. Resolution of the amount of upkeep charges of the family home to be paid by either party

3. Variation of ongoing maintenance

4. Variation in the “Education Fund”

5. An order for [the wife] to pay [the husband] half of her accommodation costs since September 2014

6. Leave to enforce the order in the UK

7. Costs”

4.  The second application was a summons for “ORDER OF ENFORCEMENT”.  I shall not repeat the wordings of the summons in verbatim as they contain some unnecessary narration of facts.  As I understand it, the husband is asking for the following orders:

(1)   The house in England (which is registered under the parties’ joint names and at 45 Trefusis Road, Glensilva, Flushing Falmouth Cornwall, TR 115UB England)(“the house”) with its furniture and fittings are to be sold by private treaty through an agent called “Lillicrap Chilcott” (“the estate agent”) at a price to be first decided by the estate agent representing the market value. The estate agent is authorised to accept any offer which is no less than 5% below the said price.  If the house is not sold within 3 months, it should then be sold by auction with a reserved price of £1.5 million and that the estate agent is to be paid an agent fee of 3% of the sale price.  If the auction fails, the estate agent should advise the court on how to achieve the sale of the house.

(2)   The personal and private effects should be distributed to the parties by agreement failing which a removal expert called “Britannia Lanes of Cornwall” is to be appointed to make a full inventory and store the items pending further order of the court.

(3)   The appointment of the firm of “Foot Anstey” to represent the parties in the sale of the house and after the deduction of all necessary outgoings, each party should be paid a sum of £250,000 with the balance to be put in the firm’s clients’ account pending agreement on the deductions in the order dated 9 August 2010 or further order of the court.

(4)   The wife to comply with all reasonable requests from the estate agent to facilitate the sale of the house.

(5)   That leave is to be granted to apply to the UK Courts for enforcement of the order.

(6)   Costs to the husband.

5.  One will notice that the husband’s 2 applications concern 2 important basic issues, one concerning the sale of the house and the other the children’s maintenance.

Background

6.  This case has a rather long history.

7.  The wife is a Korean national.

8.  The husband is a British national.

9.  The parties were married in 1994 and within wedlock, 2 children were born.  They are:

(1)   B, the elder son, now aged 21, a medical student studying in the UK; and

(2)   J, the younger son, now aged 18, a first year University student doing a foundation course also in the UK.

10.  On 9 May 2008, the wife issued a petition for divorce based on the behaviour of the husband and a decree nisi was granted by this court on 4 February 2009.   The decree was made absolute on 26 February 2010.

11.  On 19 November 2009, the parties agreed on a joint custody order of the 2 children with care and control being given to the wife.

12.  As to ancillary relief, the parties also reached a settlement on the same day based on which the court granted a consent order in the following terms (“the 1^st AR Order”):

(1)   The house is to be sold at the best available market price or at a price to be agreed and at a time to be agreed.

(2)   After the deduction of all reasonable outgoings, a sum of HK$3,000,000 is to be deducted to establish an education fund for the school or university tuition fees of the 2 children (“the Education Fund”).  If the Education Fund is not exhausted at the completion of the children’s full time education, the balance is to be divided between the parties in equal shares.

(3)   The husband shall pay a monthly maintenance of HK$30,000 towards the maintenance of the 2 children (being HK$15,000 each) from 1 December 2009 until the sale of the house, the actual receipt of the sale proceeds and the establishment of the Education Fund and thereafter the maintenance shall be increased to HK$34,000 per month (being HK$17,000 for each child).

(4)   Upon the sale of the house and after the deduction of all reasonable outgoings and the establishment of the Education Fund, the balance shall be divided between the parties in equal shares and the husband shall pay a further sum of US$186,851 to the wife from his own share.

(5)   If the house cannot be sold by 30 June 2010, as from 1 July 2010, the husband shall continue to pay the monthly maintenance of HK$30,000 per month for the 2 children (HK$15,000 each) until the actual sale and the receipt of the sale proceeds, but the husband has to pay back a lump sum representing the difference between the monthly sum of HK$41,000 and HK$30,000 as calculated from 1 July 2010 from his share of the sale proceeds of the house.

(6)   The payment of the children’s maintenance will last until them reaching the age of 18 years or finishing full time education whichever is later.

(7)   The settlement is a full and final settlement of the parties’ respective claim for ancillary relief, except for the maintenance of the children.

(8)   There is liberty to apply for carrying out the terms of the order.

(9)   No order as to costs, including all costs reserved.

13.  The anticipated sale of the house did not materialise and relying on the “liberty to apply” provision, the parties came back to the court for a further order.   On 9 August 2010, this court, again based on the consent of the parties, granted a further order  in the following terms (“the 2^nd AR Order”):

(1)   The house is to be sold as soon as possible at a price not less than £2.35 million or at such price may otherwise be agreed.

(2)   In the event that the husband is unable to pay any or the whole sum of HK$30,000 monthly maintenance for the 2 children as from 1 September 2010, all such arrears of maintenance shall be paid out from the husband’s share of the sale proceeds upon the sale of the house.

(3)   After sale, an account is to be taken of the sums due from the husband to cover the following:

(a)  The sum of US$186,851 as stated in § 4 of the 1^st AR Order.

(b)The sum representing the total difference between HK$41,000 per month and HK$30,000 per month as stated in § 5 of the 1^st AR Order.

(c)  The arrears of maintenance as stated in § 2 of this order.

(d)The sum of all outgoings and expenses paid for by the parties on the house to be agreed by the parties.

(e)  Any other sum of money to be agreed by the parties.

(4)   The solicitors or agent representing the parties in the sale shall deduct from the husband’s share the total sums of money due to the wife as stated in § 3 of the order and pay over the same to the wife.

(5)   There is no order as to costs.

14.  As at the date of this hearing, it is common ground that both parties and the 2 children have all relocated to England.   The husband has remarried with 2 children (aged 11 and 9 respectively) from this new relationship.   The wife used to live with the younger son, J, in the house but I was told that J has just moved to University accommodation recently.  The elder son is now studying at a medical school and is living away from home.

15.  It is the case of the husband that the wife has been uncooperative in the sale of the house resulting in the non-performance of the 2^nd AR Order for over 6 years. Moreover, as the husband is now retired and has taken up new financial responsibilities for his new family, he now asks for the maintenance order in favour of the children to be varied.

16.  The wife disputed the husband’s case and therefore, the husband’s applications have to be adjourned to today for trial.

Discussion

The combined effects of the 1^st AR Order and the 2^nd AR Order

17.  Pursuant to the agreements of the parties, the court has granted 2 ancillary relief orders (ie. the 1^st AR Order and the 2^nd AR Order).  I think it is important to have a clear understanding of the combined terms of the said 2 orders right at the beginning.

18.  It is my ruling that the combined terms of the 1^st AR Order and 2^nd AR Order are:

(1)   The husband shall pay a monthly sum of HK$30,000 as maintenance for the 2 children, ie. HK$15,000 each, starting from 1 December 2009 until the sale of the house, the distribution of the sale proceeds and the establishment of the Education Fund and thereafter, the maintenance are to be increased to HK$34,000 per month (ie. HK$17,000 each): §3 of the 1^st AR Order. 

(2)   The payment of the children’s maintenance shall last until the children attaining the age of 18 or finishing their full time education, whichever is the latter: §6 of the 1^st AR Order.

(3)   The house is to be sold as soon as possible at a price not less than £2.35 million or at such price to be agreed by the parties: §1 of the 2^nd AR Order.

(4)   After the payment of all reasonable outgoing and expenses, a sum of HK$3,000,000 will be deducted from the sale proceeds to establish an Education Fund out of which the school and university tuition fees of the children will be paid.  If the Education Fund should not be exhausted at the end of the day, the balance will be shared between the parties equally: §2 of the 1^st AR Order.

(5)   The net sale proceeds will be shared between the parties equally but subject to the following payments to the wife from the husband’s share: §4 of the 1^st AR Order:

(i)   In the event that the husband shall fail to pay the children’s maintenance, such arrears will be deducted from the husband’s share of the net sale proceeds: §2 of the 2^nd AR Order.

(ii)   A sum of US$186,851: §4 of the 1^st AR Order and §3(a) of the 2^nd AR Order.

(iii)   The total of the monthly sum of HK$11,000 (representing the difference between HK$41,000 and HK$30,000) calculated from 1 July 2010 until the receipt of the sale proceeds: §5 of the 1^st AR Order and §3(b) of the 2^nd AR Order.

(6)   The solicitors or the agent handling the sale shall deduct the above sums from the husband’s share and paid over to the wife: §4 of the 2^nd AR Order.

(7)   The above terms are in full and final settlement of the parties’ respective claim for ancillary relief, except for the maintenance of the children: §7 of the 1^st AR Order.

Sale of the house

19.  I shall first deal with the sale of the house.

20.  I start off by reminding myself that the parties have already reached a full and final settlement of their respective claim for ancillary relief some 7 years ago. An important term of the settlement was for the sale of the house with the sale proceeds to be shared between the parties subject to certain deductions for the establishment of the Education Fund and from the share of the husband.  This court has no power to rewrite the terms of their agreement or vary the consent orders already made, except may be for the children’s maintenance.  What the court can only do is to give further directions on how the 1^st AR order and 2^nd AR Order are to be carried out.

Estate agent

21.  The first issue is which estate agent should be appointed.  The husband suggested Lillicrap Chilcott.  The wife does not dispute that Lillicrap Chilott is a “well known firm of estate agent”.  Therefore, I have no hesitation in directing that Lillicrap Chilcott should be appointed as the estate agent to conduct the sale of the house.

Agent fee

22.  The husband asked for 3% of the sale price to be paid to the estate agent upon a successful sale.  I note that the husband has produced no evidence justifying such an agent fee, but at the same time I do not see any strong objection from the wife on the amount to be paid.  Therefore, I accept that an agent fee of not more than 3% of the sale price should be paid at sale. 

Solicitors

23.  Next is the firm of solicitors to be engaged to conduct the sale.  The husband suggested the firm of Foot Anstey.  I understand that this is a local firm and I have no reason to question its integrity and competency and therefore, I direct that the firm of Foot Anstey is to be engaged for the sale of the house.

Selling price

24.  As to the selling price, the parties indicated at trial that the reserved price of £2.35 million (as previously agreed in the 2^nd AR Order) should be adhered to. However, they cannot agree on the issue of public auction in case that the house could not be sold by private treaty.

25.  On this issue, my view is that in the event that the house could not be sold after a period of 6 months by private treaty, such sale should be effected by public auction.  The husband asked for a reserved price of £1.5 million.  The wife said it was too low but did not give any alternative proposals.   Under these circumstances, I will adopt the proposals of the husband and set the reserved price of the public auction at £1.5 million.   This is only a reserved price and I am sure that if the market is right, a much higher price can always be fetched for the benefit of both parties.

Time for sale

26.  As to the timing of sale, I think it is reasonable for the house to be sold by private treaty within 6 months from the order, failing which by public auction within 4 months thereafter.

Personal and private effects

27.  There does not seem to be any strong objection from the wife and therefore, I will order that the parties’ personal and private effects in the house to be distributed between the parties by agreement, failing which the removal specialist of “Britannia Lanes of Cornwall” should make a full inventory and store the same in their warehouse pending further order of the court.

The children’s maintenance

Variation of maintenance

28.  The next issue is the husband’s application for variation of the children’s maintenance.

The legal principles

29.  The Court’s power to grant an order for variation is governed by s11 (1) and (7) of the Matrimonial Proceedings and Property Ordinance, Cap.192 (“MPPO”) which provides as follows:

“11. Variation, discharge, etc. of orders for financial provisions

(1) Where the court has made an order to which this section applies, then, subject to the provisions of this section, the court shall have power to vary or discharge the order or to suspend any provision thereof temporarily and to revive the operation of any provision so suspended.

....

(7)   In exercising the powers conferred by this section the court shall have regard to all the circumstances of the case, including any change in any of the matters to which the court was required to have regard when making the order to which the application relates and, where the party against whom that order was made has died, the changed circumstances resulting from his or her death.”

According to the said provision, the court, in considering such an application for variation, has to consider all the circumstances of the case and in particular, any changes in the matters to which regard has been made in reaching the original order.

30.  In the case of AEM v. VFM[1], Cheung JA has explained the modern approach in dealing with such an application at paras 14.4-8 of the Judgment:

“4. The modern approach, as required by section 11(7), is for the Court to consider all the circumstances of the cases. The Court is not required to proceed from the starting point of the original order but look at the matter afresh: Flavell v. Flavell [1997] 1 FLR 353 at 357B following Lewis v. Lewis [1977] 1 WLR 409 and Garner v. Garner [1992] 1 FLR 573.

5. Any change in any of the matters to which the Court was required to consider when making the original order was one of the circumstances to be considered.

6. 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, for example, continuing inflation; the increased costs in supporting a growing child and that one party may be more adversely affected than another by the increase in the costs of living: Garner v. Garner.

7. An increase in the wealth of the husband was a relevant factor to be taken into account: Primavera v. Primavera [1991] 1 FLR and Cornick v. Cornick (No. 2) [1995] 2 FLR 490.

8. At the same time the basis and intended effect of the original order are relevant factors to which the Court on variation should pay regard and there should not be a radical departure from the approach taken by the parties themselves when they had entered into an agreement embodied in a consent order: Boylan v. Boylan [1988] FLR 282.”

31.  As to the weight to be attached to the original order, Tang VP (as he then was) said in the case of HCTT v. TYYC [2008] 5 HKC 86 at paras 15-16:

“15. But as Garner v. Garner [1992] FLR 573 shows that does not mean that the earlier order, whether made by consent or not, carries no weight. How much weight should be given to the earlier order must depend on the circumstances. Cazalet J said in the English Court of Appeal:

“Almost invariably, an application to vary an earlier periodical payment order will be brought on the basis that there has been some change in the circumstances since the original order was made; otherwise, except in exceptional circumstances, the application will, in effect, be an appeal. If an order is not appealed against, or is made by consent, then the presumption must be that the order was correct when made. If it was correct when made, then there will usually be no justification for varying it unless there has been a material change in the circumstances. However, because of the impact of continuing inflation, because children grow older and cost more to support and because, for example, the cost of living in its increase may hit one party harder than another, it will usually follow that, if time has passed, there will inevitably have been changes in the circumstances, of the parties concerned.

Following Lewis v. Lewis, by which decision this court is bound, a court on the hearing of an application to vary is fully entitled to look at all the relevant matters set out in s.25 of the Matrimonial Causes Act 1973.  On occasions, the court may be slow to accede to an application to vary a consent order; not least because the parties’ solicitors might otherwise be deterred from either seeking to negotiate such a provision or to achieve finality.  Another factor which may influence a court will be the time that has passed since the original order was made.  If an application consequent on an order is brought very soon after that order has been made, the court, in normal circumstances, is likely to attach more weight to the earlier order than if it had been made some years previously.  Likewise, the court would expect to pay full regard to any special terms agreed between the parties at the time the original order was made- as, for example, when endorsements on briefs or contemporaneous correspondence show that an agreed order has, for some particular reason, been set at an artificially low figure.  Shortly stated, the court must decide what weight it should attach to the original order and all the surrounding circumstances.  However, once an application to vary is before it, the court is fully entitled to make an order considering all the circumstances afresh, paying such regard to the older order as may be appropriate.”

16. Thus, although the jurisdiction to vary is untrammelled, normally the earlier order would not be varied unless there has been a material change in the circumstances.”

32.  I shall bear the above principles in mind when I come to consider the facts of this case.

The case for the husband

33.  The husband relies on the following submissions in support of his application:

(1)   There has been a material change of circumstances in that:

(i)   he is now aged 66 and has retired on 30 May 2016;

(ii)   he has very little income, mainly a small state pension from the UK Government at £643 per month;

(iii)   he has remarried with 2 young children aged 11 and 10 respectively;

(iv)   his present wife is working as a teaching assistant with a monthly income of about £1,300 per month;

(v)   he and his present wife own an apartment in UK with a net worth of about £48,000 only;

(vi)   his total monthly outgoings amount to £4,624 per month or £55,193 per annum (p.12 of Trial Bundle); and

(vii)   his monthly deficit amount to £2,681 per month or £23,327 per annum (p.12 of Trial Bundle).

(2)   On the other hand, the wife is still running her business and is in a better financial position than the husband.

(3)   Both B and J have now attained majority and are studying in the UK on a full time basis.  Their university tuition fees are limited to about £9,000 per annum which can also be covered by low interest student loans from the UK Government.  Therefore, the husband should be relieved from the obligations to pay the children’s university tuition fees.

34.  Based on the above, the husband now asks for the children’s maintenance to be stopped as from the date of this hearing and the establishment of the Education Fund to be set aside.

My views

35.  Despite the objections from the wife concerning some of the figures relied upon by the husband, I am satisfied that those figures should more or less represent the present financial situation of the husband.  In other words, I am satisfied that the husband has recently retired and his monthly income will largely be restricted to the state pension that he is currently receiving.

36.  As to the wife’s financial position, I understand that she may be running some business ventures but I do not think she is enjoying the financial affluence as the husband would like to believe she is.  This is largely due to the fact that she had suffered from cancer and the fact of her relocation to the UK with the younger son in about 2014.

37.  After considering all the circumstances of this case, I have decided that it may not be appropriate for the children’s maintenance to be terminated as from the date of this hearing.  However, I am of the view that the husband’s responsibility to pay the children’s maintenance should end at the completion of their present university degrees.  

38.  These are my reasons.

39.  I note that when the parties reached their agreement in 2009 and 2010 (the 1^st AR Order and the 2^nd AR Order), the husband had already formed an intimate relationship with his present wife.   His 2 young children were born sometimes in 2005 and 2006.  Therefore, the fact that the husband had a new family and 2 young children were circumstances already prevailing at the time of agreement.  They cannot be regarded as something new or being a change of circumstances justifying a variation of the maintenance order.

40.  On the other hand, I do accept the fact that the husband is getting older due to the lapse of time and he has retired from full time employment recently. However, that does not mean that he is not in a position to continue to pay the children’s maintenance because he still holds half of the equity in the house.   It seems that both parties have no strong objection that the house is worth about £2.35 million.  Half of that being £1.175 million, ie. about HK$12,000,000 (by adopting an exchange rate of £1: HK$10.20).   Even with the deductions under the 1^st AR Order and the 2^nd AR Order, I think there is still a not insubstantial amount of money being left to the husband.

41.  I understand that B has another 3 years before he will finish his medical degree.  According to the wife, he wants to do another PhD which may take another 3 years.   It is my view that the husband’s duty to support B should end in 3 years’ time, ie within the time that would allow B to complete his medical degree.  If he should decide to pursue further studies after that, I think he has to find his own way to do it.   Assuming that the sale of the house could be effected within the coming 12 months, ie. on or before 1 October 2017, the husband’s future liability towards B after that date would be restricted to 2 years only, ie. HK$408,000 (HK$17,000 x 24 = HK$ 408,000). 

42.  As for J, he has another 4 years before he finishes his first degree upon which the husband’s duty to support him should end.  As from 1 October 2017, the husband has to pay another HK$612,000 (HK$17,000 x 36 = HK$612,000).  

43.  In other words, the total sum of B and J’s future maintenance as from 1 October 2017 amount to HK$1,020,000 (HK$408,000 + HK$612,000 = HK$1,020,000).   It is a sum well within the husband’s ability to pay.

44.  As a further step to achieve certainty and finality between the parties, I think it is preferable to fix the date of increase of maintenance (from HK$30,000 to HK$34,000) now, instead of waiting for the sale of the house.   Again, assuming that the sale of the house could be achieved in about 12 months, I would vary the maintenance order and fix the increase of maintenance to start from 1^st October 2017 and such payments would end on the children finishing their first university degree or by 31 August 2019 for B and 31 August 2020 for J, whichever is earlier.

45.  I understand that the wife would like to have all future maintenance for the children to be converted into a lump sum and paid out from the husband’s share of the sale proceeds.  In view of the husband’s claim of impecuniosities, I think it is fair to make such an order so as to achieve something akin to a clean break.  Therefore, it is my ruling that the periodic payment order for the children’s maintenance is to be replaced by a lump sum order of HK$1,020,000 which is to be deducted from the husband’s share of the net sale proceeds.

Education Fund

46.  The provision for the establishment of the Education Fund (HK$3,000,000) was contained in the 1^st AR Order.   There is no dispute that the purpose of such a fund was to cater for the children’s future educational needs.  There are 2 important points to note here.  First, the use of the Education Fund was restricted to the payment for “school or university tuition fees” of the children.   Therefore, I do not accept the wife’s arguments that the children’s living expenses should also be paid out from this fund.   Second, there was no provision in the 2^nd AR Order setting aside the establishment of this Education Fund.   It is clear from the 2^nd AR order that it only deals with the issue on how to carry out the sale of the house and to calculate the sums being owed by the husband to the wife, but leaving the establishment of the Education Fund untouched and intact.  

47.  The husband is now arguing that he should not be responsible for the children’s future university tuition fees as the children could have financial assistance from the UK government making the establishment of Education Fund unnecessary. I do not agree.  It is true that needy students in the UK can apply for financial assistance from the government but they have to be repaid upon employment after graduation.  I agree with the wife’s view that if the parents can afford to pay for the tuition fees, which I believe is the case here, there is no reason why they should not shoulder such responsibilities and require the children to repay the student loans upon graduation.   After all, it was the parties’ unequivocal agreement that the children’s school and university tuition fees should be paid out from their joint assets, there is no reason why any of them should renege on such agreement, especially when they are financially able to do so.  

48.  Having said the above, one also has to bear in mind that only a small part of the Education Fund needs to be utilized.  Given that I have already restricted the husband’s payment of the children’s maintenance to 3 and 4 years respectively (ie not beyond their present university education) and if the husband’s estimation of the children’s university tuition fees at £9,000 per annum is correct, that means the total future university tuition fees amount to £63,000 only (£9,000 x 3 + £9,000 x 4 = £63,000, ie about HK$642,600).  In other words, only about 20% of the Education Fund needs to be used and the balance will go back to the parties in equal shares.   Under these circumstances, I think it is fair to reduce the Education Fund to £70,000, allowing some room for future increase or inflation, which should be enough to pay for the 2 children’s university tuition fees for the coming 3 to 4 years.  The division between the 2 children should be £30,000 for B and £40,000 for J. 

49.  In principle, this sum should come from the Education Fund to be established after the sale of the house.  This arrangement means that both parties will share the future tuition fees equally.  In order to simplify the matter, I think it is better for the husband just to bear half of this sum, ie. £35,000.   In other words, instead of establishing such an Education Fund, I would direct that a sum of £35,000 is to be deducted from the husband’s share of the net sale proceeds to satisfy his liability towards the 2 children’s future university tuition fees.

Past maintenance and up keep charges of the house

50.  At the beginning of trial, there were some disputes on the expenses being incurred by each party on the maintenance of the house.   Each claimed reimbursement from the other party.  During the course of trial, the husband proposed, which was later accepted by the wife, that they would regard each party’s past financial contribution to the upkeep of the house to be more or less the same and so they will not make any further claim of reimbursements from the other party.   Therefore, there is no need for me to make any order in this regard. However, for the way forward and in order to avoid any future disputes, I would direct that the wife should be responsible for future outgoings as long as she is enjoying the use of the house.

51.  Just to complete the discussion, the husband did ask for the wife to pay for half of the accommodation costs since September 2014.  It is not clear whether he is still pursuing that claim, but even if he is, it is my view that the wife being a joint owner has every right to reside in the house with the sons until its sale.

Arrears of maintenance to be deducted from the husband’s share

52.  It is one of the husband’s applications that there should be a “resolution of the amount of past maintenance to be deducted from the sale of the house”.

53.  There is no dispute that the husband has defaulted in the payment of maintenance since 1 December 2009.  However, it is the husband’s case that certain sums of money should be deducted from the said arrears of maintenance, including education fees (meaning the school or university tuition fees after the children have relocated to the UK), housing allowance (meaning the fee payable by the wife when she started staying in the house), holiday expenses (meaning the money that he has paid for the children’s past holidays).  

54.  I have already ruled that the children’s school and university tuition fees should continue to be paid by the husband.   I have also ruled that the wife needs not pay anything for her previous stay at the house in England.  As to past holiday expenses allegedly paid by the husband, apart from the fact that there is no evidence to prove the actual amount spent on the children, I am not convinced that such sums, even if proved, should be deducted from the monthly maintenance payable by the husband.

55.  However, there are some other items that I think should be deducted from the maintenance payable by the husband.  They include the school fees paid by the husband or through his former employer, the details of which are contained in §22 of the husband’s supporting affidavit (pp19-20 of the Trial Bundle).  The total amount of such payments is HK$942,581.50.  I understand that most if not all are related to school fees of the children, which according to §2 of the 1^st AR Order, should be paid out from the Education Fund, meaning that they should be borne by the parties equally.  Therefore, it is my ruling that the wife should bear half of that amount and the easiest way to achieve that is to deduct half of that sum at HK$471,290.75 (HK$942,581.50 x ½ = HK$471,290.75), to be rounded up to HK$470,000, from the arrears of maintenance owed by the husband.

56.  Based on the above, the total arrears of maintenance until the sale of the house should be:

(1) Maintenance from 1/12/2009 to 30/9/2017

    (HK$30,000 x 94 = HK$2,820,000)   HK$2,820,000

    Less

(2) 1/2 of school fees paid by the husband    HK$470,000

   Net: HK$2,350,000

Leave to enforce the order in the UK

57.  In both of his applications, the husband asked for leave so that he could enforce this court’s order in the UK.  At trial, I asked for the legal basis upon which this court has power to grant such an order but the husband cited the provisions of the Maintenance Orders (Reciprocal Enforcement) Ordinance, Cap.188 instead, which are clearly irrelevant to our present situations.   On the second day of trial, the husband then applied for an adjournment so that he could seek legal advice by making an application to the Legal Aid Department. As we were already in the middle of the trial and more importantly, I do not think the husband’s application for legal aid would have assisted his case in any way, I refused his application for adjournment. 

58.  Going back to the merits of the husband’s application for leave to enforce a Hong Kong order in the UK, I am not aware that this court has such a power. Obviously, whether the UK courts would enforce such an order is a matter for that jurisdiction.  Therefore, the husband’s application in this regard is refused.

Conclusion on the maintenance and deductions

59.  Based on the above discussion, these are the rulings on the children’s maintenance:

(1) The total amount of arrears of the children’s maintenance (from 1 December 2009 to 30 September 2017) is HK$2,350,000, such sum is to be deducted from the husband’s share of the net sale proceeds of the house.

(2) In addition, the following sums should also be paid and deducted from the husband’s share of the net sale proceeds of the house:

(i) A lump sum of HK$1,020,000 being the future maintenance of the children as from 1 October 2017 to 31 August 2020.

(ii) A lump sum of £35,000 being half share of the children’s university tuition fees as from 1 October 2017 to 31 August 2020. 

(iii) A sum of HK$ 946,000 (the difference between HK$41,000 and HK$30,000 as from 1 July 2010 to 30 September 2017: HK$11,000 x 86 = HK$946,000).

(iv) A sum of US$186,851.

(3)   The total amount of the above deductions are therefore:

(i) HK$2,350,000

(ii) HK$1,020,000

(iii) £35,000

(iv) HK$946,000

(v) US$186,851

Orders

60.  The orders to be made are:

(1) For the sale of the house:

(i) The house is to be sold by private treaty at or above the reserved price of £2,350,000 within 6 months of the order.

(ii) If the house cannot be sold by private treaty within 6 months, such sale should be effected by public auction with a reserved price of £1,500,000 within 4 months thereafter. 

(iii) Lillicrap and Chilcott is to be appointed as the estate agent to conduct the sale.

(iv) The estate agent is to be paid an agent fee of not more than 3% of the sale price.

(v) The solicitors firm of Foot Anstey is to be appointed as the handling solicitors for the sale.

(vi) After the deduction of all reasonable and necessary outgoings and expenses of the sale, the net sale proceeds should be divided between the parties in equal shares, but subject to deduction from the husband’s share as set out in the following paragraph.

(vii) The parties’ personal and private effects in the house are to be distributed between the parties by agreement, failing which the removal specialist of “Britannia Lanes of Cornwall” should make a full inventory and store the same in their warehouse pending further order of the court.

(2) The following sums should be deducted from the husband’s share of the net sale proceeds by the handling solicitors and paid over to the wife:

(i) HK$2,350,000 as the maintenance for the 2 children as from 1 December 2009 to 30 September 2017.

(ii) HK$1,020,000 being future maintenance for the children as from 1 October 2017 to 31 August 2020.

(iii) £35,000 being the husband’s half share of the children future university tuition fees.

(iv) HK$946,000 being the difference between HK$41,000 and HK$30,000 as from 1 July 2010 to 30 September 2017.

(v) US$186,851.

(3) This order is in place of the 1^st AR Order and the 2^nd AR Order.

Costs

61.  As both parties are unrepresented, I think a fair order is that there shall be no order as to costs, including all costs reserved.   This will be in the form of an order nisi to be made absolute upon the expiry of 14 days from the handing down of this judgment.