IDC v. SSA

FCMP 158/2011

[2019] HKFC 255

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FAMILY COURT

MISCELLANEOUS PROCEEDINGS NO. 158 OF 2011

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DECISION
(LITIGATION FUNDING)

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Application

1.  This is a hearing of the Applicant mother (“the mother”)’s summons dated 4 April 2019 (A/162) for litigation funding in which she asked for the following provisions for her legal fees in the parties’ respective application for variation of the minor’s maintenance:

(1)     A lump sum of $500,000 or a sum which the court considers reasonable in the circumstances; and

(2)     A periodic sum of $50,000 per month, or a periodic sum which the court considers reasonable in the circumstances.

2.  The Respondent father (“the father”) opposes the application.

Background

3.  This case has a long history.  Ms. Booth for the mother has helpfully set out the background in paragraph 3 of her “NOTE FOR THE APPLICANT MOTHER” most of which, if not all, will be adopted here so as to give the necessary background to the present applications.

4.  The parties were unmarried and had cohabitation between 2006-2010, during which the minor (“Z”) was born.  Z is now 10 years old and resides with the mother in London.

5.  After the deterioration of the parties’ relationship, the mother applied for financial provisions for Z under the Guardianship of Minors Ordnance, Cap. 13 (“GMO”) in 2011.

6.  On 14 September 2012, HH Judge Bruno Chan ordered joint custody of Z to the parties, with care and control to the mother and defined access to the father.  On 22 January 2013, the father was also ordered to pay monthly maintenance of HK$118,000 for the benefit of Z in addition to his undertakings to pay Z’s school fees, domestic helper, flight tickets, holiday allowance, etc.  As far as costs are concerned, the father was ordered to bear 70% of the mother’s costs with credit to be given for the litigation funding of HK$750,000 previously paid by him. 

7.  The mother subsequently applied for the relocation of Z to London during which hearing the father gave an undertaking to pay HK$500,000 as contribution towards the legal costs of the mother.  The relocation application was allowed and both the mother and Z have started to live in London since 2015.  The father was ordered to pay the costs of the relocation application which was later agreed at HK$1,782,680 less the litigation funding of HK$500,000 previously paid.  Since relocation, the father has in fact been paying a monthly sum of about HK$144,000 as Z’s maintenance due to the increase in rental costs in London.

8.  On 26 April 2018, the mother issued her summons asking for a whole list of financial orders for Z including the transfer/sale of 6 landed properties. 

9.  On 17 May 2018, the father issued his summons asking for a downward variation of the maintenance order and the discharge of certain undertakings given by him back in 2013.

10.  After the filing and exchange of the parties’ Form E, there were allegations of insufficient disclosure on the part of the father and a summons for discovery was issued with an argument date being set on 31 October 2019.  In order to fund the said discovery application and the application for variation generally, the mother issued her summons for litigation funding on 4 April 2019 which was adjourned to today for argument.  Just prior to the hearing, the father issued another summons asking for a Single Joint Expert (“SJE”) to be appointed to make an objective assessment of Z’s reasonable monthly needs by reference to the supporting documents to be provided by the mother.  If this could be done, coupled with the father’s continuous stance on his “millionaire defence”, the need for a detailed discovery process may not be really necessary.  Under those circumstances and subject to the mother’s further consideration on the appointment of SJE, the parties now agreed for the discovery application to be adjourned sine die with liberty to restore.  Be that as it may, the mother still asks for litigation funding so as to allow her to move the case forward, at least up to the next stage of litigation, i.e. the FDR hearing.

Applicable laws

11.  Despite the fact that both parties do not question the court’s powers in granting orders on litigation funding, if appropriate, they have very different views on the statutory basis upon which such orders could be made.

12.  According to Ms. Booth, the court could grant such orders on litigation funding based on section 10(2) of GMO:

“(2) The court may as regards a minor, on the application of a person with whom, whether by virtue of an order under subsection (1) or otherwise, custody of the minor lies at law, make in respect of the minor any one or more of the following orders-

(a) An order requiring payment to the applicant by the parent or either of the parents of the minor of such lump sum (whether in one amount or by instalments) for the immediate and non-recurring needs of the minor or for the purpose of enabling any liabilities or expenses reasonably incurred in maintaining the minor before the making of the order to be met, or for both, as the court thinks reasonable having regard to the means of that parent;

(b) An order requiring payment to the applicant by such parent or either of such parents of such periodical sum towards the maintenance of the minor as the court thinks reasonable having regard to the means of that parent;

…”

13.  Counsel submits that the court can order lump sum payments in guardianship and minors proceedings where there are specific needs to meet.  The court is not restricted to the granting of a single lump sum, but may grant several lump sums as confirmed by the Court of Appeal in their previous decision in this case.[1]

14.  On the other hand, whilst accepting that the court does have power to grant orders on litigation funding, Mr. Chan for the father submitted that such jurisdiction could only be exercised under section 13(3) of GMO, which provides for interim orders on maintenance to be made:

“(3) On an application under section 10 the court may, in any case where it adjourns the hearing of the application for more than 7 days, make an interim order, to have effect until such date as may be specified in the order and containing –

(a) provision for payment by either parent to the other, or to any person given the custody of the minor, of such periodical payments towards the maintenance of the minor as the court thinks reasonable having regard to the means of the parent on whom the requirement is imposed; and

(b) where by reason of special circumstances the court thinks it proper, any provision regarding the custody of the minor or the right of access to the minor of either of his or her parents,

but an interim order under this subsection shall not be made to have effect after the end of the 3 months beginning with the date of the order or of any previous interim order made under this subsection with respect to the application, and shall cease to have effect on the making of a final order or on the dismissal of the application.

…”

15.  It is Mr. Chan’s submission that an order on legal costs provision is necessarily dealt with on an interlocutory basis, while lump sum orders (under section 10(2) of GMO) are final orders which could only be made by agreement or after trial.  In granting lump sum orders, the court has to be satisfied that the sum(s) incurred or to be incurred are reasonable which is only possible if either the parties agree on them, or failing which upon the court’s adjudication after considering the parties’ evidence.  He further submits that legal costs provisions are payments “on account”, meaning that they will be taken into account later, including by way of set-off where appropriate.  The same cannot be said for lump sum orders made under section 10(2) of GMO.

My Views

16.  In this regard, I note from WGL v ASB [2]which was a similar case on litigation funding but heard in the Court of First Instance, in which Mr. Chan was acting for the applicant in that case.  In the judgment, Hon B Chu J gave an analysis of the differences between the Hong Kong and English provisions concerning financial reliefs for children born outside wedlock.  It was then stated at paragraph 9 of the Judgment, when it came to the issue of litigation funding, that:

“9. …Notwithstanding these discrepancies, neither counsel disputed that this court has jurisdiction to make a costs allowance order under sections 10(2)(a) or (b) for the benefit of a child, or ILB in the present case….”

It seems that Mr. Chan’s previous stance in WGL v ASB was quite different.

17.  Be that as it may, I note that the issue on whether a litigation funding order should be made under section 10(2) or 13(3) was not fully argued in WGL v ASB,and in the present case, counsel have not cited any clear binding authorities on this point.  After hearing counsel, I accept Mr. Chan’s present submission that if the order on litigation funding is granted under section 10(2) of GMO, the court must be satisfied that they are expenses reasonably incurred or to be incurred, which is, failing the parties’ agreement, an impossible exercise before the full consideration of the evidence.  On the contrary, if the order is to be granted under section 10(3) as an interim order, the usual broad-brush approach can be adopted and there is no need to go into the evidence in detail.  By this analysis, I accept that a section 10(2) order must be a final order, subject only to appeal or a future variation if change of circumstances, whereas a section 13(3) order is only an interim order which can be properly adjusted or taken into account after the final adjudication of the claim.

18.  I am further aware that the wordings of section 10(3) may impose a period of 3 months for such an interim order.  But as pointed out by Mr. Chan, the accepted practice is to treat such period being automatically extended saving the parties’ trouble in coming back to court every 3 months, provided that the court should consider such a longer period is indeed justified.

19.  Based on the above discussion, I am satisfied that a litigation funding order should be made under section 13(3) instead of section 10(2) of GMO.

Should litigation funding be allowed, and if yes, how much?

20.  Having ruled on the legal basis upon which a litigation funding order could be made, I now come to consider whether such an order should be made in the present case, and if made, the quantum of such an order.

21.  It is common ground that in considering whether such a litigation funding order should be made, the principles as set out in Currey v Currey [3] are applicable, despite the fact that these are not matrimonial proceedings (see R, ER v H, IF[4] at §11 ). Those principles are:

“the conditions for a ‘costs allowance’ are as follows:

(1) That the applicant spouse has no assets, or none that can be reasonably be deployed (at para [19], [20]).

(2) That she can provide no security for borrowing, or none which can reasonably be offered (at para [19], [20]).

(3) That she cannot reasonably obtain legal services by offering a charge on the outcome of the litigation (at para [20] and see Sears Tooth, per Wilson J).

(4) That she cannot secure publicly funded legal help ‘at a level of expertise apt to the proceedings’ (at para [20]).”

There is also a requirement to undertake an overarching enquiry:

“At para [20], Wilson J held that the initial, overarching enquiry should be into whether the applicant for a costs allowance could demonstrate that she cannot reasonably procure legal advice and representation by any other means. Therefore, to the extent that an applicant has assets (as in C v C), she has to demonstrate that they cannot reasonably be deployed (whether directly or as the means of raising a loan) in funding legal services …. Other factors may well come into play. The subject matter of the proceedings would always be relevant, as would the reasonableness of the applicant’s stance in the proceedings.”

No Skeleton Bill of Costs

22.  Before we proceed to discuss the mother’s application for litigation funding by reference to the 4 Currey principles, I note from Mr. Chan’s written submissions that his first complaint concerns with the lack of a proper skeleton bill from the mother.  I was referred to HH Judge Melloy’s case in YS v TTWD [2011] HKFLR at 447 §27, in which the learned Judge cited the Court of Appeal decision in K v K[5]:

“Ms. Yip complained however (and with some justification it seems to me) that the wife was not K v K compliant in that there was no skeleton bill of costs or any real indication of what she was seeking or why…. In K v K, CACV N0.80, 31 August 2010, Rogers VP said

‘It seems to me that the appropriate course would be for a court to be told what the foreseeable anticipated costs are likely to be. That can be done in much the same way as the detail in which a court is told when security for costs is asked for. In other words, not an elaborate bill of costs, but a simple back of the envelop type bill of costs itemizing out what counsel’s fees are likely to be and what the solicitor’s expenses are likely to be. That can be done in a very simple sort of way but not in a complicated sort of way. Then the court should try and make the appropriate order. If it is to be on a monthly basis, the order should come to an end when it is foreseen that the expenses would be fully covered.’ “

23.  I was further referred to the father’s 3^rd Affirmation dated 12 July 2019 at §17 (B/168) in which he stated that:

“17. I cannot verify how much out of the HK$1,427,360 stated in [the mother]’s Form H dated 4 April 2019 was specifically related to the parties’ respective applications on variation of maintenance, as are claimed in [the mother] ‘s Current Summons for Litigation Funding. Without further clarification, it will entirely be unjustified for me to pay HK$500,000 for the outstanding legal fees in association with [the mother] ‘s Summons for Variation of Maintenance, and my summons dated 17 May 2019.”

24.  It was submitted that the mother was made aware of the father’s concerns in this regard, but she did not bother to address this issue in her latest 24^th Affidavit prepared in September 2019.

My Views

25.  I note that the mother’s solicitors did lodge the mother’s costs schedule on 13 September 2019 which was divided into 2 parts.  The first part concerns with costs from 1 January 2018 to 30 August 2019.  The second part concerns with costs after 30 August 2019 to 31 October 2019.  There was no explanation on why the demarcation was set on 30 August 2019.  Furthermore, for the costs incurred before 30 August 2019, there was also no explanation on why some of those costs were quoted on a monthly basis but some were not.

26.  I was reminded by Mr. Chan that we are here to deal with litigation funding for the wife so as to allow her to proceed with her claim for variation and to defend the father’s cross claim.  It also has to be borne in mind that when the previous costs of the mother being incurred, some of them were related to her unsuccessful interlocutory applications with adverse costs orders against her. Therefore, the quotation of all her previous costs is not helpful at all in identifying the real costs position of the mother, as far as her prospective costs are concerned.

27.  Having said the above, I note that from Part 2 of the costs schedule that the mother did quote her estimated costs from 30 August 2019 to 31 October 2019 in the sum of $201,400 in which $73,000 of counsel’s costs were included.  Although I accept that this part of the costs schedule can be improved upon by, for example, providing more details on the solicitors’ costs to be incurred, I consider this to be an acceptable skeleton bill of costs to be relied upon by the court in arriving at a proper order on litigation funding, if any.

Unreasonable Litigation Conduct

28.  Another complaint of Mr. Chan was the mother’s unreasonable litigation conduct.

29.  In his Written Submissions, Mr. Chan referred me to various passages in HH Judge Bruno Chan’s judgments about the unreasonably high level of legal costs being incurred in this case.  I do not intend to go into the details of those costs, not only that they are already history but more importantly, the same criticism applied not only to just one party, but to both of them.

30.  It is regrettable to note that the learned Judge’s comments have fallen on deaf ears.  I note that the mother has incurred legal costs in these applications in the sum of $2,079,746 up to 30 August 2019 (i.e. within a period of 20 months), which does not even include the present hearing on 18 September 2019.  That is a huge sum of money if compared to Z’s maintenance order in the sum of $118,000 per month, bearing in mind that we have yet to reach the discovery hearing, not to mention the FDR. 

31.  On the other hand, the father has also incurred substantial legal costs of $1,776,181.50 up to 6 September 2019, which is not a small sum either.  According to his estimate, he needs to spend another $470,000 till the end of the applications, bringing his total costs to about $2,246,181.50.  Although he may argue that part of the costs incurred was due to the unsuccessful interlocutory applications lodged by the mother in which he was actually granted costs by the court, I am still of the view that the costs incurred by the father were far too high.  I think it is high time for the parties to rethink about their litigation strategies.  The combined legal costs of $3,800,000 incurred so far can benefit Z a lot, if they are channeled into proper use, instead of into the pockets of their respective legal representatives.

32.  In this respect, I think the proposal on the appointment of SJE by the father may be a right step.  But as the mother needs time to consider the proposal, I would refrain from further comments at least until the next hearing on 31 October 2019. 

33.  Another related submission by Mr. Chan is that despite the accumulation of the mother’s legal costs of $2,079,746, which were confirmed to be outstanding by Ms. Booth on behalf of the mother, there was no explanation on what arrangements have been made so as to allow such default to continue.  I think there may be some force in this criticism. However, I have to remind myself that we are still at the interlocutory stage dealing with an interim application for litigation funding of which a broad-brush approach would be adopted.  It may not be appropriate for this court to read too much into this and come to a conclusion that the mother must have financial assistance from other sources, be they from family or friends. 

34.  Having considered the above, and in order for the mother to obtain proper legal advice and to have some equality of arms before the court, I am convinced that the mother should be entitled to some form of litigation funding provided that the 4 principles as laid down by Currey could be satisfied.  

35.  I now turn to the discussion on the 4 Currey principles.

The Currey Principles

36.  Just a quick reminder of the 4 Currey principles:

(1)     That the applicant spouse has no assets, or none that can be reasonably be deployed.

(2)     That she can provide no security for borrowing, or none which can reasonably be offered.

(3)     That she cannot reasonably obtain legal services by offering a charge on the outcome of the litigation.

(4)     That she cannot secure publicly funded legal help ‘at a level of expertise apt to the proceedings’.”

The mother’s financial resources

37.  As can be seen from the mother’s Form E (B/18-41), it is the mother’s case that she does not have income (being a student), resources or means to raise capital to pay her legal fees.  She has confirmed on many occasions that she has no other source of income other than the maintenance paid by the father.

38.  The father has raised queries on such propositions pointing out that the mother’s legal representation seems to be unaffected despite the accumulation of huge outstanding legal fees, suggesting that there may be other source of financial assistance available to her.  I have dealt with such query in paragraph 33 above.  All in all, I am satisfied at this interim stage that the mother has no financial resources or assets that can reasonably be deployed to pay for her legal costs. 

Security for borrowing

39.  After considering the mother’s Form E, I am also satisfied that, at least at this interim stage, the mother could provide no security for borrowing, or none which can reasonably be offered for such purpose.

Obtaining legal services by offering a charge on the outcome of the litigation

40.  There were no discussions on this option by either counsel in their submissions. That is the case because I think such an arrangement is almost unheard of in the Hong Kong context.  In any event, no objection was raised on this aspect by counsel for the father and I will say no more on this.

Whether the mother could have obtained legal aid

41.  I think this is the more contentious issue under the Currey test.

42.  It is the father’s case that in view of the mother’s claim of lack of financial resources, she could have applied for legal aid.  Apparently, the mother has failed to do so and therefore, she should not be allowed litigation funding.

My Views

43.  I think we have to take a more realistic view of the matter.  The mother is now residing in London taking care of not only Z, but also another minor (“N”) born from another relationship.  Both these 2 minors are now attending school and need the full time attention of the mother.  There is no suggestion that a legal aid application can be done by post, or through email, or through a firm of solicitors representing the applicant.  It is just unrealistic to expect the mother to return to Hong Kong simply for the purpose of making an application for legal aid.  Moreover, there is no offer from the father to pay for her air tickets and hotel accommodation for such purpose.  Under these circumstances, I think it is unfair to criticize the mother in not making an application for legal aid.  After all, there is no dispute that her previous legal aid application has been turned down and I see no significant change of circumstances that would change the result of another legal aid application.

44.  Based on the above discussion, I am of the view that the mother has satisfied the Currey test for litigation funding and the only other issue is the quantum, to which I now turn.

The amount of litigation funding

45.  There is no dispute that the order on litigation funding should be structured, especially as to its duration, so as to best encourage the receiving party to act reasonably, looking in good faith to try and reach settlement.  Therefore, if such a litigation funding order is to be made before the FDR, it may well be wise for it to be granted up to that hearing: HJFG v KCY [2012] HKFLR 27 at §§82 & 85.

46.  Although a FDR hearing is yet to be fixed pending the decision on whether a SJE is to be appointed, I have checked my diary and it seems that a date in February or March 2020 is likely to be available. Therefore, I am minded to granted a litigation funding order up to the month of March 2020 and see how it goes from there.

47.  The next issue is the reasonable amount of litigation funding that I should grant so as to allow the mother to carry on these proceedings up to March 2020.  I note from the mother’s schedule of costs that her estimated costs from 30 August 2019 to 31 October 2019 is about $200,000.  The estimated costs of the father from 18 September 2019 to 31 October 2019 is about $270,000.  Doing the best as I could, I would say that a sum of about $400,000 as litigation funding for the mother up to March 2020 is reasonable.  By reference to this figure, I am minded to grant the mother litigation funding by way of interim maintenance in the sum of $35,000 per month payable on 4th day of every month backdating to 4 April 2019.

Orders

48.  Based on the above reasons, I hereby grant an interim maintenance order for litigation funding for the mother as follows:

(1)     A sum of $35,000 per month payable on 4th day of every month starting from 4 October 2019 up to 4 March 2020;

(2)     A lump sum of $210,000 being backdated payments from 4 April 2019 to 4 September 2019 payable within 14 days from the date of this order;

(3)     The above payments are to be made directly to the solicitors representing the mother; and

(4)     The above payments on litigation funding are to be taken into account and subject to a set-off, if appropriate, on the parties’ costs at the end of the present proceedings.

Costs

49.  Costs to follow event. The mother has to come to court before she could have an order on litigation funding.  She should have the costs of the application, including costs reserved with certificate for counsel.  The costs order will be in the form of an order nisi which will be made absolute after the expiry of 14 days from the handing down of this Judgment.

[1]IDC v SSA [2013] HKFLR 61

[2] HCMP 489 of 2013, Date of Judgment: 30 November 2017

[3] [2006] EWCA Civ 1338

[4][2018] HKFC 229

[5] CACV No. 80, 31 August 2010 unreported

FCMP 158 / 2011

[2018] HKFC 91

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

FAMILY COURT

MISCELLANEOUS PROCEEDINGS NO. 158 of 2011

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D E C I S I O N

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Foreword

1.  These proceedings were brought by the Applicant (Mother) under the Guardianship of Minors Ordinance, Cap.13 (“GMO”) against the Respondent (Father) for financial reliefs in respect of their child born in March 2009, who is now at the age of 9.

2.  On 22 January 2013, His Honour Judge Bruno Chan after trial ordered that the Father do pay a periodical sum of $118,000 a month to the Mother for the financial support of the child.    I will describe this as the “2013 Order”.

3.  In addition, within the terms of the 2013 Order, there are a number of undertakings from the Father to pay for the child’s other expenses such as school fees, school bus charges, fees for ballet and music classes, medical insurance, reasonable costs of extra curricular activities such as piano, arts and crafts, Mandarin lessons.   

4.  Moreover, the Father also undertook to pay for holiday provisions including 2 economy class round trip tickets per year, HK$600 per day as daily expenses on holidays up to 2 weeks per trip.   The Father further undertook to be directly responsible and continue to pay the child’s local travel, food, clothing, toys and presents, as well as the salary of the domestic helper, directly to the Mother.   That is not the end of it, the Father further even undertook to pay for the annual passes for Ocean Park and Disneyland for the child and the Mother.

5.  On 26 April 2018, the Mother applied (by way of Inter Partes Summons) (“the Variation Summons”) for variation of the 2013 Order not for any upward adjustment of the periodical sum of $118,000, but seeking an overhaul variation to the extent that there be lump sum order; secured lump sum order; settlement of property order; transfer/sale of property order in respect of 6 units all located in the Convention Plaza, Wanchai, Hong Kong, with each of the addresses individually set out, and also for variation of settlement order.    Though the Mother caused the Variation Summons to be registered against the title of the landed properties, the Lands Registry only classified the Variation Summons under “Deeds Pending Registration” column rather than as an encumbrance.   The Variation Summons was scheduled for hearing on 18 May 2018 before Judge CK Chan (that is, in 7 days’ time) as the first call over hearing.   Undisputedly, all the landed properties against which registration was sought are legally owned by corporations in respect of which the Father has beneficial interests.

6.  Yesterday around 4:30 p.m., this Court received from the Father’s lawyers Tanner De Witt (“TDW”) a letter requesting an urgent hearing be arranged to deal with the Father’s application for vacating registration of the Variation Summons under s.19 of the Lands Registration Ordinance, Cap.128, in respect of 2 out of the 6 landed properties named in the Variation Summons.   Apparently he was unable to secure the Mother’s agreement through parties’ lawyers exchange of correspondence to vacate those “lis” pending registration.   In TDW’s letter, it was said that completion of sale of the 2 units was scheduled for today but without stating at what time today.   The amount at stake of the 2 transactions are valued was said to be in the order of HK$78 million.

7.  At around 9:00 a.m. today, an urgent appointment was arranged by this Court for the Father’s application to be heard at 9:30 a.m.   TDW’s letter of yesterday informed this Court that they had given notice of their intended ex parte application to the

Mother’s lawyers Messrs. Oldham, Li & Nie (“OLN”) and would inform them of any hearing scheduled by this Court.

8.  Around 10:06 a.m. today, the hearing started where Counsel Mr. Edward Alder appeared for the Father.    Upon instructions, Mr. Alder confirmed to this Court that OLN had been duly informed by his instructing solicitors Mr. Mark Side about this urgent hearing.   Nonetheless, nobody turned up for the Mother and the hearing proceeded.   This Court directed an affirmation of service as to notice of this hearing having been given to OLN to be filed by TDW by 4:00 p.m. today. 

9.  There was before the Court the Father’s Ex Parte Summons and his supporting Affirmation dated 10 May 2018 and filed today.   There are also paginated bundles incorporating, amongst others, those letters exchanged between TDW and OLN prior to this application (at pages 333 to 339 of Bundle B).    There was also a written skeleton argument of Mr. Alder dated 10 May 2018 before this Court with a brief submission in reply to the case of Sun Ngai International Investment Limited v. Zhang Su Hua [2008] HKCFI 591, [2009] 1 HKLRD 48, the case which OLN relied upon and refused to accede to the Father’s request for vacating those “lis”.    During the hearing which started around 10:06 a.m. and it was only upon my enquiry, this Court was informed for the first time that the time for completion was scheduled for 11:00 a.m. today, which is just less than in an hour (my emphasis).

10.  At the end of the hearing, this Court granted the Father’s application on terms; leaving behind the reasons for decision to be now given. 

The parties’ respective positions

11.  Counsel Mr. Alder had not produced any cases or authorities.  Though OLN for the Mother had not appeared at this hearing, I have had the benefit of reading the letters exchanged where the Mother’s stance could be readily seen. 

12.  The Mother relied upon the case of Sun Ngai International Investment Limited v. Zhang Su Hua [2009] 1 HKLRD 48, which is a decision of the High Court by Deputy Judge Carlson to support her stance that she was entitled to register the Variation Summons pending its determination.

13.  Towards the end of Mr. Alder’s skeleton submissions and also confirmed by Counsel this morning, the Father offered to pay out from the net proceeds of sales to OLN any balance of payment due for May 2018 and also advance payments for the next 3 months (June, July and August) and for OLN to immediate release to the Mother.

The Court’s Views

14.  First of all, I am satisfied that this is an application of utmost urgency properly brought before me as the Duty Judge.   Secondly, TDW’s letter of yesterday confirmed that the present hearing so requested is an ex parte on notice application and that they would inform OLN of any hearing arranged by this Court.   Thirdly, I was re-assured by Counsel Mr. Alder this morning that on his instructions from TDW, OLN had been duly informed of this hearing. 

15.  I have had the benefit of hearing submissions from Counsel Mr. Alder and reading all the relevant papers before me, including the 19^th Affidavit of the Mother filed

in support of the Variation Summons.   I have also considered the case of Sun Ngai International Investment Limited v. Zhang Su Hua (supra) which on all fours deals with registration of “lis pendens” against title of landed properties owned by corporation where an individual spouse has a beneficial interest.   I have reminded myself that the Sun Ngai case is binding upon me.

16.  However, given careful consideration, I decided that the Sun Ngai case is distinguishable on facts from the present application.

17.  Firstly, the Sun Ngai case related to a pending FCMCcase where ancillary reliefs of the spouse had not been determined by the Court nor concluded at any stage.   In such a scenario, the spouse ought to be protected against any disposal or dissipation of landed properties which, subject to the Court’s determination at the ancillary reliefs trial, might fall within the pot of family assets for distribution or sharing.   Thus, the spouse should be entitled to secure her position through registration of the Form A/Form 25 as a “lis” notwithstanding that those landed properties are legally owned by corporations of which the other spouse had a beneficial interest.    There is a whole spectrum of factors to be considered under Section 7 of the Matrimonial Proceedings and Property Ordinance, Cap.192 for spousal ancillary reliefs.   In the present case, which is a FCMP case, the financial reliefs afforded under the GMO restricted only to the needs of the child to be balanced against the paying parent’s means and ability to pay.   Most importantly, in the present case, such needs of the child had already been fully argued and determined by the Court after a full trial back in 2013 although amendable to variation as time goes by.

18.  The instrument registered as “lis pendens” in the Sun Ngai case, namely, a Notice of Application for Ancillary Relief (which I believe to be either in Form A or Form 25 issued in the FCMC proceedings) was found by the learned Deputy Judge to be

an instrument falling within the definition in s.1A of the Land Registration Ordinance, Cap.128, and thus is registrable notwithstanding the property against which registration was made was under the name of the plaintiff company Sun Ngai rather than under the name of the individual spouse.   This is also the scenario in this case.   

19.  Whilst I have no intention or was being asked to find and determine whether the Variation Summons likewise caught by the definition in s.1A and thus registrable, suffice to say is that the Mother or her lawyers are astute enough to see that she would not be able to register the fruits of litigation, namely, the 2013 Order wherein there was no reference to any address of landed properties.    The Form A or Form 25 comes under the Matrimonial Causes Rules, Cap.179A is not applicable to proceedings under the GMO which the Mother could make use of.    

20.  However, by issuing the Variation Summons seeking reliefs related to landed properties, as in the present case seeking transfer or sale of property orders, the Mother would then have the chance to spell out addresses of those landed properties in the Variation Summons against which reliefs were sought.    As a matter of course, she could then have it lodged with the Land Registry hoping that she would be able to register, or at the very least, to create a “lis” to put off any potential buyers of the properties.    In the present application, the question which falls to be determined is whether it is fair to the Father, taking into account all the circumstances, to be “stopped” or “deterred” from taking any commercial decisions on his assets by the mere fact that the Mother had just filed a variation application pending to be heard ?   In my view, the answer must be in the negative.    As a matter of law, variation application does not carry the force of a “Quia timet injunction”.

21.  Having said and given the fact that the Variation Summons had yet to be determined, the success or failure of which remains uncertain whereas by maintaining it on the Land Register thus putting off potential buyers is a certainty, there is no basis for the Mother to argue against removal of such “lis” because they are needed to protect the child’s interest under the 2013 Order.    To be fair to the Mother and not to prejudice her position in her forthcoming variation application, perhaps I should stop here and not postulate any further the Mother’s contention without hearing full argument of her Variation Summons.    

22.  Furthermore, on the matters set forth in the Mother’s 19^th Affidavit, there is also no basis for this Court, if being satisfied with the Father’s application, at this stage to order all the net proceeds of sale be paid into Court when there was no evidence of dissipation of assets to defeat the 2013 Order.    Any conditions imposed for the Father to pay into court all or part of the net proceeds of sale at this stage is akin to making a secured payment order in advance (my emphasis) of determination of the Mother’s Variation Summons.    Had there been evidence of dissipation by the Father to avoid payment of the 2013 Order, the Mother upon legal advice could have taken injunctive reliefs whilst seeking variation.     In my view, those incidents of late in payment as set out in paragraph 12 of the Mother’s 19^th Affidavit could not be equated with dissipation of assets.    I also wish to say that those insubstantial periods of delay seem to me that it does not even justify taking enforcement proceedings which the Mother rightly had never done so.

23.  At paragraphs 15 and 17 of the Mother’s 19^th Affidavit, she allegedly sought for restraint orders over net proceeds of sale of a property already sold by the Father in March 2018 and other properties but so far up until today, no Summons for restraint orders or injunctive reliefs had been taken out. 

24.  As said, there is a comprehensive set of on-going undertakings by the Father for the child’s other expenses, which covers almost every other aspect of the child’s day to day financial needs, coupled with the adjudged amount of HK$118,000 a month.   There is no cross application by the Father to seek variation, discharge or  withdrawal of any of the on-going undertakings nor had the Mother stated in her 19^th Affidavit that over the years since the 2013 Order the Father had been in repetitive breaches of those undertakings.   Thus, I can hardly see that the remaining 4 units in the Convention Plaza, which are in the same complex of luxurious values, would not be sufficient to cater for the future needs of the child so much so that it warrants the entire net proceeds of sale of the 2 units in question or part thereof be paid into Court to secure the child’s interest.    With those comprehensive on-going undertakings remain in place, I believe the remaining 4 units in the Convention Plaza would be sufficient to cater for the child’s needs even if the Mother at the end of the day is successful in her Variation Summons in whatever form of reliefs.

My Decision

25.  For all the above reasons, I grant an Order in terms of the Father’s Summons dated 11 May 2018 on terms that a sum of HK$432,000 be paid to OLN, Solicitors for the Mother, being past due and 3 months’ advance payments under the 2013 Order, for immediate release to the Mother.

26.  I also decided that the costs of and occasioned by this application be reserved; to be dealt with after disposal of the Mother’s Summons dated 26 April 2018.

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 158 OF 2011

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

____________________

____________________

________________________

JUDGMENT
(Relocation of Child)
________________________

1.  This is an application by the Applicant Mother by way of a summons issued on 2^nd December 2014 for leave to permanently relocate her child Z, a 6-year old daughter born out of wedlock with the Respondent Father and whose sole care and control has earlier been granted to her by this court, from the jurisdiction of Hong Kong to England for a variety of reasons but essentially to pursue a university degree there so as to acquire a career to become financially independent as she is just a visitor in Hong Kong without any visa to work here.

2.  Her application is opposed by the Father who sees it as at best premature on the basis that her planning as to housing and schooling for their daughter as well as her own university course is all very immature which would not be in the daughter’s best interests, and he suspects that the whole application is in fact motivated by her obsession with obtaining an order that he purchase a property for their daughter’s accommodation, something which she has been unable to obtain in Hong Kong and hence her desire to do so in England.

3.  There have already been a long series of litigation between the parties in these proceedings, and it would be relevant to rehearse some of their details first.

Background

4.  The full details of the parties’ background and their litigation can be found in my earlier judgment dated 22^nd January 2013 on the Mother’s application for financial provision for Z, I therefore do not propose to recite all of them here save for the more relevant parts plus those that have transpired since.

5.  The Mother, now aged 36, is a British born in Germany to a British soldier but moved with her family to London in 1987 where she lived and studied arts. Upon leaving school she worked as a fashion model and travelled around the world on her jobs. In 2003 she married a Thai film director and gave birth to her elder daughter N in the following year. In 2006 she divorced her husband and left Thailand to come to Hong Kong with N on a tourist visa where she formed a relationship with the Father, now aged 42 who is also a British having moved to Hong Kong in the 1990s where he has since been running a successful fashion accessories business.          

6.   The parties were never married but cohabited together since late 2006 in the Father’s spacious property at Convention Plaza Apartments with N as well during which the Mother generally remained as a housewife and together with N were essentially dependent on the Father. On 8^th March 2009 she gave birth to Z. The Father can be said to be very wealthy and had provided the Mother and the 2 girls with a lifestyle of very high standard and comfort.

7.   That relationship however ended in late 2010 and the Mother consequently moved with the 2 girls into a rented apartment at Bel-Air, Pokfulam while still being maintained by the Father. In July 2011 she launched these proceedings under Guardianship of Minors Ordinance, Cap 13 (“GMO”) for custody and financial provision for Z during her minority including interim maintenance of not less than HK$180,000 per month and such lump sum and other financial relief as may be deemed appropriate.

8.   The parties were eventually able to agree to have joint custody of Z with her care and control to the Mother and certain defined access including staying access to the Father which were made into an order on 14^th September 2012, but not on the issue over financial provision for Z given the huge gulf between their proposal, when the Mother sought a lump sum of HK$32 million for purchasing a suitable property preferably at Bel-Air to accommodate her and the 2 girls, a further lump sum of HK$1.2 million for renovating the property and for purchasing a car to meet Z’s transportation needs, and a monthly sum of almost HK$175,000 to meet Z’s living expenses as well as her own personal expenses, and for the Father to continue to pay directly Z’s school fees and other educational and extra-curricular expenses, while the Father’s proposal was essentially only monthly sum of about HK$90,000 to cover Z’s living expenses including rental plus reasonable costs of her extra-curricular activities and an annual provision of airfares for her holidays.

9.   As a result the parties went through an acrimonious and expansive 5-days trial in late 2012 during which the major issue was centred over whether the court had any power under the provisions of GMO to make the kind of lump sum order sought by the Mother for the purchase of a property to accommodate Z, and if so whether the Father should do so in the circumstances.

10.   In my judgment delivered on 22^nd January 2013 I found that the court could derive no such power under GMO specifically Section 10(2) for the purpose sought by the Mother, and ordered the Father to pay a total monthly sum of HK$118,000 for Z being HK$93,000 for her living and rental expenses and HK$25,000 for the Mother’s carer allowance, on the basis that the Father shall continue to be directly responsible for Z’s school fees and other educational expenses, extra-curricular activities and holiday expenses (“The Financial Order”).

11.   The Mother subsequently appealed the Financial Order to the Court of Appeal, which on 6^th June 2014 ruled that the court does have jurisdiction to order such a lump sum under Section 10(2)(e) of GMO, but refused to alter the Financial Order. She then sought to appeal to the Court of Final Appeal but her application for leave was refused first by the Court of Appeal on 22^nd September 2014, and then by the Appellate Committee of the Court of Final Appeal on 10^th February 2015.

12.   It was between these 2 leave applications that the Mother on 2^nd December 2014 issued her present relocation summons for leave to remove Z permanently to England as she wishes to return home to London to pursue a degree so as to have a job or career to become financially independent which cannot be achieved in Hong Kong on a tourist visa and without the right to work, and being the primary carer of Z it is therefore necessary for her to bring Z with her in order to be able to continue to take care of her in London where they will be close to her parents and family, while the Father can maintain close and regular contact with Z by telephone, Skype or other electronic means as well as monthly access whenever he is in London and during major school holidays.

13.    The Mother’s application was as noted opposed by the Father who suspects that it was motivated by her obsession for the purchase of a property for Z, and hence after she has exhausted all legal means in Hong Kong, he fears that she now tries to pursue it in London by bringing this application, that in any event it is at best premature and in its planning very immature, and that a move of Z from her Hong Kong home and life without clear and concrete plans cannot be said to be in her best interest, a view appeared to be shared by the resultant Social Investigation Report submitted on 13^th March 2015 and which is not in support of the Mother’s application.

14.    It is worth noting that under the said joint custody order of 14^th September 2012, the Father has been able to enjoy the following access to Z on a 2 weekly cycle as follows:

15.    In addition he has also been able to share Z’s major school holidays generally with the Mother who has been flexible about him enjoying additional days for special occasions. Perhaps as a result the Father issued a summons on 6^th January 2015 for shared care and control of Z and for additional access to her while pending the determination of his summons, but which was subsequently adjourned at his request without determination.

16.    After the inevitable flurry of further affidavits exchanged by the parties and an unsuccessful CDR hearing on 27^th March 2015, the Mother’s application proceeded to trial for 4 days in late May 2015 during which the parties were represented as before by Ms Francis Irving for the Mother and Mr Russell Coleman SC for the Father.

17.    At the commencement of the trial, the Mother made her open proposal with various arrangements and details of the Father’s access to Z upon her relocation to London and which can be summarised as follows [2A/863 – 868]:

(a) Joint custody remains between the parties;

(b) Sole care and control remains with the Mother;

(c) The Father shall have regular access to Z by Skype and telephone;

(d) The Father shall have access to Z during her school term for 10 consecutive days each month including visiting and staying access upon 7 days’ notice to the Mother save for the months in which he has his share of Z’s school holidays;

(e) The Father shall continue to share with the Mother of Z’s half-term school holidays, Christmas and Easter in alternate year and half of her summer holiday;

(f) The Mother shall use her best endeavours to reach agreement with the Father on the choice of school for Z, to discuss and communicate with him and to cooperate with him for the best interests of Z and on all matters concerning her education and medical issues save in an emergency with a view to reaching consensus on any differences in relation to her overall welfare, and not to make any unilateral decisions on such matters;

(g) The Mother undertakes to the court to have this order registered in the Court in London so that there is a mirror order in England within 6 months of Z’s removal to London and to return her to Hong Kong when called upon to do so.

18.   The Father did not make any open proposal but his case for Z is clear from his various affidavits, which consists essentially of the following points:

(a) Z has lived in Hong Kong since birth, that she is settled in school here with many friends, and is doing well in that school environment;

(b) Both parties are capable parents of Z and have been actively supporting her in her schooling and school activities;

(c) He is a very hands-on father and has always been actively involved in every aspect of Z’s life since her birth;

(d) Z has a close and loving relationship not just with him but also with the extended paternal family living in close proximity to him in Hong Kong;

(e) The Mother’s intended destination for relocation is not a place where she has spent considerable time as an adult or where she has a clear existing support network, whereas her working and adult life has been spent mostly in Asia and for the last 8 years in Hong Kong;

(f) The Mother’s plans for the relocation are not thorough or well-thought out including Z’s future education, which left a flavour of a rush to London so as to mount a financial application there;

(g) There are courses similar to the ones for which the Mother wishes to study in London available in Hong Kong and of which she should do more research and which may render it unnecessary for her to do so in London thereby saving significant travel time which would otherwise be available for care of Z in Hong Kong;

(h) The Mother has not properly explored her immigration options in Hong Kong, on which she should have taken detailed immigration law advice and action;

(i) Any relocation of Z would necessarily involve a very significant reduction of care time with the Father with immense impact on their close relationship, and that in overall terms, the Mother’s proposed relocation is simply not in the best interests of Z;

(j) The status quo in respect of Z’s custody and care arrangements should be maintained with variation of the Father’s access to reflect previous flexibility of practice and the Mother’s open proposal for sharing of care and additional access including at least 2 additional nights of staying access following his usual weekday evening access;

(k) Z should not be permanently removed from Hong Kong and should instead continue to attend Kennedy School in Hong Kong, while his shared care application be adjourned sine die with liberty to restore.

19.   Before I am to consider the evidence of the parties’ respective case, it would be relevant for me to first set out the law and principles applicable to such relocation application.

The Legal Principles

20.  The applicable principles governing relocation application were based on the English Court of Appeal case of Payne v Payne [2001] Fam 473 and adopted by our Court of Appeal in SMM v TWM [2010] HKFLR 308, [2010] HKLRD 37 CA where Cheung JA very helpfully summarised them at §21 of his judgement as follows:

 “1) The distinct features of a relocation application are first, the applicant is invariably the mother and the primary carer; second, generally the motivation for the move arises out of her remarriage or her urge to return home; and third, the father’s opposition is commonly founded on a resultant reduction in contact and influence. (per Thorpe LJ at paragraph 27)

 2) The two proportions that have been consistently applied by the Courts are, first, the welfare of the child is theparamount consideration; and second, refusingtheprimary carer’s reasonable proposals for the relocation of her family life is likely to impact detrimentally on the welfare of her dependent children. Therefore her application to relocate will be granted unless the Court concludes that it is incompatible with the welfare of the children. (per Thorpe LJ at paragraph 26)

 3) The application should be approached as follows :

     (1) Is the mother’s application genuine in the sense that it is not motivated by some selfish desire to exclude the father from the child’s life? Then ask, is the mother’s application realistic, i.e. founded on practical proposals both well researched and investigated? If the application fails either of these tests, refusal will inevitably follow.

     (2) If, however, the application passes these tests then there must be a careful appraisal of the father’s opposition: is it motivated by genuine concern for the future of the child’s welfare or is it driven by some ulterior motive? What would be the extent of the detriment to him and his future relationship with the child were the application granted? To what extent would that be offset by extension of the child’s relationships with the maternal family and homeland?

     (3) What would be the impact on the mother, either as the single parent or as a new wife, of a refusal of her realistic proposal?

     (4) The outcome of the second and third appraisals must then be brought into an overriding review of the child’s welfare as the paramount consideration, directed by the statutory checklist in so far as appropriate. (per Thorpe LJ at paragraph 40)

 4) In short, the relevant factors are :

     (1) The welfare of the child is always paramount.

     (2) There is no presumption created by section 13(1)(b) of the English Children Act 1989 in favour of the applicant parent.

     (3) The reasonable proposals of the parent with a residence order wishing to live abroad carry great weight.

     (4) Consequently the proposals have to be scrutinised with care and the Court needs to be satisfied that there is a genuine motivation for the move and not the intention to bring contact between the child and the other parent to an end.

     (5) The effect upon the applicant parent and the new family of the child of a refusal of leave is very important.

     (6) The effect upon the child of the denial of contact with the other parent and in some cases his family is very important.

     (7) The opportunity for continuing contact between the child and the parent left behind may be very significant. (per Butler-Sloss P at paragraph 85)”

21.  It is under these principles and guidance that I shall now approach the Mother’s application, starting first to consider whether it is genuine in the sense that it is not motivated by some selfish desire to exclude the Father from Z’s life.

Is the Application Genuine?

22.  The Mother’s main supportive affidavit, her 38-pages 12^th Affidavit [1A/4] which, as pointed out by Mr Coleman for the Father, contains large amount of historical background information and materials in particularly details of her failed relationship with the Father which have all been rehearsed before and which I, again, found to be irrelevant, unhelpful and serve no purpose other than to increase tensions and antagonism with the Father, for which she had been criticised before in my earlier judgment when she started off these proceedings with an even more voluminous affidavit with hundreds of pages of irrelevant exhibits, but which criticism apparently neither she nor those advising her have taken any heed.

23.  Her reasons are stated in §43 – 55 of that 12^th Affidavit [1A/21 – 27], the gist of which can be summarised as follows:

(a) She being the primary carer of Z, and for that matter N as well, wishes to return home in London with both of her daughters so that she can finally settle down and put down roots, as they are British while Hong Kong is not her home, and with her parents, brother and grandmother all live close to London, she will have good family support while her daughters can spend more time with them;

(b) She and N do not have any residential status or visa in Hong Kong, nor does she have any prospect of decent employment here as she has no skills or experience other than modelling, that she has been struggling to make ends meet for her family on the maintenance order that was awarded on 22^nd January 2013 most of which is to cover her rental expenses and which will cease when Z is 18 or completes full-time education and the Father no longer has to pay any maintenance or her carer’s allowance, when she will be aged 50 without any form of income or ability to find work, or any financial resources or pension to support herself;

(c) Hence she now needs to retrain and enter employment in London which will provide her with a career and a decent income going forward, and while Z is being financially supported by the Father, she needs to support N as her father is not reliable;

(d) She has been greatly interested in the subjects of nutrition and endocrinology for years, and has decided to work in this field in which case she will need to study for a degree and obtain the relevant qualification in London as she cannot do so in Hong Kong without a student visa for the Higher National Diploma first before entering university, something which she cannot afford both in terms of time and costs, and that in any event there is no equivalent or suitable degree course here;

(e) She has since been accepted by the University of Westminster in London for a 4-years BSc degree in biochemistry and nutritional science which is to commence in September 2015, and for which she intends to apply for student loans to cover the school fees and expenses;

(f) She therefore believes it to be in Z’s best interests to move with her to England where she will be in a position to retrain and find gainful employment, which will not only provide her with financial stability but also enable her to better take care of not just Z but also her sister N, as they need a strong role model and she feels she can be a better one for them with a career and financial security.

24.  The Mother went on to make the following proposals in her said affidavit and in her evidence as to future arrangements for accommodation and schooling for Z in London:

(a) For accommodation she would like the Father to agree to purchase a property on trust for Z in London, but she proposes to wait 12 months so that she and the children settle in London first, and meanwhile she will rent a serviced-apartment on short-term while looking for a suitable 4-bedrooms property of similar size of the Bel-Air Apartment in close proximity to the children’s school and her university from the Schedule of Accommodation Options exhibited to her said affidavit [1A/62] including St John’s Wood, Maida Vale and Marylebone and at a monthly rental ranging from about £4,300 to £5,800 which she proposes to pay from the current maintenance order;

(b) For schooling she proposes that both girls should attend the same school from one of those listed in the Schedule of School Option [1A/63] all of which have excellent reputation, with her first choice on King Solomon Academy which is a government state school;

(c) She also proposes to take her domestic helper with her to London and when the helper’s current contract expires by the end of the year, if she is willing to stay she will renew her contract so that she can continue to assist her in taking care of the girls when she attends classes.

25.  Ms Irving therefore submits that the Mother’s application is clearly genuine as she has no future for herself in Hong Kong where she and N are just a tourist and hence their position here is precarious, it is only right that she wants to go home in London where she has a loving and supportive family and the opportunity to acquire an education and some independence, and with her generous term time access offered in her open proposal to the Father, there is simply no indication at any time that the Mother has sought to exclude Z from him or that she has done anything to damage their relationship.

26.  I accept that it is never the Father’s case that the Mother’s application is motivated by any desire to exclude him from Z’s life, but he suspects that it may be for some reasons other than those stated by her, as he points out that originally the application was predicated clearly on the Mother’s desire to move to study in London, but from around the time of the failed CDR hearing, whilst study remains one point, the emphasis has since shifted to include the suggestion that she must leave Hong Kong for immigrated status reasons of herself and N, and he submits that that shift in stance must be seen against the history of the litigation, as it reveals a wholly inconsistent stance taken by the Mother, which casts grave doubt on the overall basis for her move.

27.  Firstly, Mr Coleman submits for the Father, that the Financial Order made on the Mother’s earlier application for appropriate financial support from the Father was calculated by reference to the costs of her living with both N and Z in Hong Kong, and when she appealed the said Financial Order to the Court of Appeal, the main thrust of the appeal was also as regard her claim that the Father should purchase or settle a property for Z in Hong Kong.

28.  Mr Coleman submits that when the Mother failed to persuade the Court of Appeal on that claim and then launched her application for leave to appeal to the Court of Final Appeal in February 2015, which he notes was well after the commencement of her relocation application, when the whole purpose of that intended final appeal was still to obtain a property for use for the long term in Hong Kong during Z’s minority, he submits that it is simply irreconcilable with her argument now that she must leave Hong Kong.

29.  It is therefore clear, Mr Coleman submits, that including from the procedure timing at least a main aim of the Mother has always been to secure a purchased or settled property to live in, and if that cannot be achieved in Hong Kong, then she tries for London, which was writ large in her oral evidence at this trial as well as at the hearings before the appellate courts when her Counsel was at pain to point out that the norm in the English Courts would be for an ordered settlement or purchase of a property, and hence the Father suspects that this claim is actually behind the Mother’s motive for bringing the present relocation application as he believes that she will no doubt pursue it in London now that she could not get it in Hong Kong.

30.  Mr Coleman submits therefore in light of the prominence that the immigration issues attracted in the Mother’s argument at such a late stage in this litigation, as well as her emphasis on the need for a property to be purchased, the court should share the Father’s concerns that:

(1) the whole point of the financial litigation as pursued by the Mother must have been on the basis of the Mother and Z could and would remain in Hong Kong for the long term, and the appeals must also have been pursued on that basis;

(2) million of dollars on legal costs have been spent and, if relocation is permitted, largely wasted on financial matters predicated on a long-term future for Z in Hong Kong, when it is now the Mother’s position that she must leave, and that she must do so on a basis that it has always existed since long before she even began these proceedings in 2011;

(3) a fundamental driver of the Mother’s stance in the litigation in Hong Kong, not least on the appeals, was her strong desire for the purchase of property rather than rented ‘temporary’ accommodation, hence that litigation is now simply going to move to London, and in effect risks starting all over again, which cannot be in the interests of the parties to continue to haemorrhage money in this way, nor can it be in the best interests of Z for this to happen.

31.  I propose to first deal with the criticism of the Mother shifting her case to include her immigration status in Hong Kong at the late stage of the litigation: That she is in Hong Kong on a tourist visa, and for that matter so is N, is a fact never challenged by the Father, and whether or not she is guilty of only raising it at such late stage does not in any way alter that fact.

32.  This criticism is in fact not fair, as not only did the Mother raise her concern over her immigration status in Hong Kong in her very first affidavit filed in these proceedings on 11^th August 2011, she did also express her concern there about her lack of job opportunity/career in Hong Kong and possible relocation in the same affidavit at §76 [early trial bundle 1/90, 136 – 137] when she said:

 “I ended my modelling career as a result of the promises made by the Respondent (the Father) to look after me and N and Z ... The Respondent has now ceased to provide adequate resources for me and my daughters. I cannot afford the living costs for my daughters in Hong Kong without substantial financial resources. I currently stay in Hong Kong on a visitor’s visa. The Immigration Department has refused my request to be a resident. There is now produced and shown to me marked “IDC-18”, a copy of letter from the Immigration Department dated 18 May 2010. If the Respondent is not going to provide adequately for me and my daughters, then relocation from Hong Kong may be the only sensible solution.”

33.  Whatever the uncertainty over her future in Hong Kong, there is no denying of the Mother’s desire for the Father to purchase a property for Z during her minority in these proceedings, and by her single-minded pursuit of such an order in both the first instant trial and her subsequent appeals in Hong Kong, the Father feels entitled to challenge her stated reasons by raising these questions: If she was indeed genuinely desirous of obtaining a degree and a career in London, why pursued such an order in Hong Kong all the way to the Court of Final Appeal, and that if she had been successful in obtaining an order for the Father to purchase a property for Z in Hong Kong, would she then still be as concerned about her immigration status or lack of employment here, and would she still want to pursue her degree in London?

34.  While these questions seem valid and legitimate at first glance, ultimately in my view they do not matter as the Mother’s desire to get the best possible financial security for Z should not render her application any less genuine or reasonable.

35.  Firstly, there can be no dispute of the Mother’s very limited earning capacity as a fashion model, and notwithstanding the Father’s allegations of various odd jobs in the past, it is a career with a fairly short life-span and according to the Mother in her circumstances and at her present age realistically it is finished.

36.  Again there can be no dispute and as I have found in my earlier judgment, the Mother was throughout their cohabitation wholly dependent on the Father, and to large extent so was N, to both of whom he had been very generous providing them, and of course Z as well, with a very high standard of living with a secured and comfortable lifestyle. In fact as far as the Mother is concerned they had actually gone through certain ceremony in Bali in about 2007.

37.  It is against this background and in this context that the court should be looking at the Mother’s reasons not only of her present relocation application but also her earlier financial application for Z and subsequent appeals, and while the extent of the costs of which as pointed out by the Father was subject of criticism on appeal, rightly so if I may respectfully agree, it is however in my view unfair for the Father to criticise her for so pursuing the appeals, as after all she was proved to be correct on the issue of jurisdiction, and failed only on the court’s exercise of discretion which could have been easily gone in her favour. The point is, why was she not entitled to go for the best possible financial security for Z, in particularly when she all along rightly believed that the court does have jurisdiction to order the Father to purchase a suitable property for Z?

38.  When she has exhausted all legal means to get the kind of financial security that she wants in our courts, and has to face a wholly uncertain future with no job or earning capacity and with no residential status in Hong Kong, why is she not entitled to look to her home country where her parents and family live for a better and more secured future, and why should the decision on which course to study or which school to enrol be dictated to her by anybody other than herself? And rightly or wrongly, if sometimes in the future she finds it necessary to bring proceedings again in London for that financial security against the Father, then so be it.  

39.  In the premises I have no reason to doubt that the Mother’s application is genuine in that it was motivated to exclude the father from Z’s life, and so I turn to consider the next question as to whether it is realistic.

Is the Application Realistic?

40.  In other words, is it founded on practical proposals both well investigated and researched? The Father thinks not, not just in terms of housing or schooling for Z, but also as to the Mother’s own education.

41.  Starting with housing, it is the Father’s argument that it is simply not enough for the Mother to have spent just one day in London in 2014, as conceded in her oral evidence, looking for various accommodation options, as it is no answer for her to say that she knows the area well as London has changed very much since she lived there more than 10 years ago, and that she should have done a lot more such as actually visiting schools, walking around the areas for hours or days at various times, going to find specific buildings or part of streets in which to look for specific choice of property, etc, things that the court would ordinarily expect on such an application.

42.  This was however not done, Mr Coleman submits for the Father, as the Mother’s affidavits contain no maps or photos, just the barest details of a range of accommodation from the internet with no thorough investigation, with no explanation of why specific accommodation will likely be available within the catchment area for any particular school if she looks for it say over the summer, and notwithstanding the comments from the Father that her plans were not well developed and lacked details, the Mother did not return to London for further research, but instead she chose to spend time holidaying in Europe which is why, he submits, the Social Work Officer had expressed the same view that the plan was not well-developed.

43.  The same can be said about the Mother’s plan for schooling for Z, Mr Coleman argues, which is again devoid of details or information apart from the said Schedule, that she has not even arranged to see any school or met any teacher, and that no place has yet been for Z of any school even at this late stage other than the hope of getting Z into the school she wants, which depends on being in the right catchment area and finding a suitable residential property at that time in that area, which he submit as wholly unsatisfactory, especially when she has always been aware that the Father wishes Z to go to private school instead, but she has never looked into that option at all in her research.

44.  In reply Ms Irving for the Mother argues that it is wholly unrealistic to expect her to have secured a property any earlier as she simply has no funds to pay for two rents, but having already indentified the area in which she would like to live by reference to the state schools available and which is also close to the homes of the Father’s family members in London as well as the state schools she favoured after having done research into the Ofsted results of the schools in that area, and that she will bring her domestic helper along, which is all she could reasonably do in her circumstances and for which she should not be criticised, especially by the Father of all people when he was not assisting at all at least as far as choosing the right school for Z until at the trial when he agreed to consider accompanying the Mother to London for that purpose.

45.  I agree with Ms Irving that given what the Mother has already done with her research and in view of her financial limitation, and while she may have lived away from London over the past 10 years or so, it is not as if she was a total stranger looking to live there for the first time, and with the support of her brother and parents, I do not find her plan premature or unrealistic at all.

46.  The Father also questions the Mother’s plan for her own education in London where the core is that she cannot do the course she wants in Hong Kong, and that she cannot get a visa to study here, but he submits that neither point is well made out on her own evidence, as her 14^th Affidavit shows that she has only actually applied for one part-time course [2A/565] and never any full-time course in any discipline at any of the universities in Hong Kong, and that if she is offered such a full-time course, it is submitted that a student visa will likely be granted or at least gives rise to eligibility for a student visa.

47.  I have already made the point that it is not for any of us to dictate to the Mother what to do with her studies other than to assess whether her plan is realistic, but given the fact that she has already been accepted by the university, that point now seems moot to me. Of course she will have to find ways to cover its expenses for the next 4 – 5 years, for which she has indicated that she will apply for government loans and with the current maintenance order including her carer’s allowance, I am unable to say that her study plan is unrealistic either.

The Father’s Opposition & Impact

48.  I must first stress here that I do not for one minute doubt the Father’s love and concern for Z, and I do not believe that his opposition to the Mother’s application is in anyway driven by any ulterior motive other than his genuine concern for her future welfare or interests, and any suggestion that his opposition is for his financial gain in not having to purchase a property is, I agree, impossible to reconcile with his intention to buy, albeit at a reasonable time of his choosing, or for that matter the likelihood of the Mother to renew this claim of hers in this court in the event her relocation application is refused.

49.  Given his close relationship with Z and his current substantive access to her, there is no question in my mind of the impact on the Father should Z be relocated to London, both on his relationship with his daughter and also on his work as it is simply unrealistic if not impossible for him to take the long trip to London and back regularly or on a monthly basis just for that purpose, hence his physical contact with Z will certainly be reduced compared with the weekly access which he has been able to enjoy currently in Hong Kong, and hence the emotional impact on him for missing his daughter at least during the early stage should not be disputed, but the Mother believes that a daily or regular contact by Skype, telephone or other electronic means as well as the generous access arrangements including major school holidays will certainly enable the father-daughter relationship to be maintained, and that whatever emotional impact on the Father will only be temporary and no doubt ease off over time. I agree and believe that the Father, given his qualities of optimism, intelligence and fortitude, all of which I observed during the course of the proceedings, will no doubt be able to handle his emotional loss and keep going, particularly as he has such strong commitments to his daughter and with such generous contact arrangement in place.

Impact on Mother

50.  On the other hand, I agree with Ms Irving that it will be emotionally devastating to the Mother if her application is refused and that she has to remain in Hong Kong in her present circumstances, as not only would she be highly stressed and unhappy with constant concerns over her immigration status, and more significantly her uncertain financial future not only for herself but also for N, as well as the emotional loss of not being able to put down root here, all of which I believe will have a much bigger adverse impact on her given her less or weaker emotionally composed personality, and which I fear will just manifest in her continued resentment towards the Father, and that undoubtedly cannot be in the best interests of Z in the long term.

Social Investigation Report

51.  As noted above the report by Ms Lam dated 13^th March 2015 [2A/627] submitted for the purpose of the Mother’s relocation application seems not supportive as she stated in §28 [2A:635]:

 “(The Mother)’s wish for removal to England to start anew is understandable. She wants to strive for an independent living and nutures the two daughters under a peaceful mind. Taking into consideration that there is no fixed accommodation, the two parties’ different views towards arrangement of public or private school issue, (the Mother)’s time management after attending a full-time degree course and the father’s worry to maintain the close father-daughter relationship, the feasibility of the removal child plan seems not yet well prepared for Z, which carries long term implication on her upbringing and her relationship with both parents. Most importantly, Z has explicitly showed her preference to live with (the Mother) and meet the father regularly while close bonding was observed between Z and (the Father) and his paternal relatives. Maintaining the bonding with the significant others is definitely beneficial for Z’s healthy development. It is inevitably affected if removal is granted to (the Mother).”

52.  The views of Z on her parents and the relocation issue were set out in §18 of Ms Lam’s report where the relevant part can be found as follows:

 “6-year old Z was individually interviewed twice. The first interview was conducted at (the Mother)’s home on 17.2.2015 … For the parent-child relationship, Z gave 9 marks out of 10 to the mother while father got 7. The second interview was held at the playroom of the Social Investigating Officer’s office on 24.2.2015 right after the father-daughter observation. Through drawing, A, in ranking her closeness with her family members, N came first, then the mother, followed by the third paternal grandmother and then the father. Z understood that the mother might remove to England for living. She verbalized her wish of staying in Hong Kong and live with the mother and N. She also wanted to meet the father to play various toys with him and the two cousins.”

53.  Ms Irving for the Mother submits that Ms Lam’s reasons for not supporting the relocation application are one-sided, flawed and illogical in that she stated matters of her concerns over accommodation and schooling for Z in London in her report without discussing them with the Mother, that her stance that no change should take place as the present situation worked for Z, and that she placed too much weight on Z’s wishes at her present age.

54.  I agree with Ms Irving and found that Ms Lam also failed to address at all the impact on the Mother if her application is refused, as she conceded at the hearing, or how such impact may affect Z in her growth and development while under the Mother’s care. Similarly Ms Lam should not have placed so much weight on the view of a child of that age, and that it is only normal for children, and in fact for grownups too, to be afraid or resist changes to the environment to which they have grown accustomed to, but that by itself should not be a valid reason to change, as otherwise all relocation applications would fail, especially when the change is as I have found for the long term good of all concerned in particularly the primary carer.

Z’s Best Interests

55.  There is no doubt in my mind that it is in Z’s best interests to grow and flourish under the primary care of her mother in a happy and settled environment and with her elder sister N and of course with regular and generous contact with her father, and for all these to happen it is essential for her mother as her primary carer to feel content and confident and with a sense of financial security and stability not just knowing that they will be provided by the father but also from her own ability and earning capacity, and as she has submitted, to be a good and successful role model for Z in addition to the one which she already has from her father.

56.  Conversely it cannot be said to be in her best interests when her mother is constantly under emotional stress and financial insecurity with no job or career of her own, and according to the Mother no future in Hong Kong, all of which as I have noted would no doubt manifest over the long term and adversely impact on her daily care of Z, and on N as well, and would certainly far outweigh whatever benefits that Z may have from living in the same city with her father and from seeing him every week.

Conclusion

57.  In conclusion I am satisfied that the Mother has validly and convincingly made out her application that it would be in Z’s best interests to be relocated permanently out of Hong Kong to London with her mother and her sister, and so I grant her leave to do so, and accept her various undertakings as set out in her open proposal and make an order in terms of her proposed access for the Father accordingly.

58.  I also agree that the current Financial Order should continue for the time being and to be reviewed as suggested by the Mother in about 12 months, and that the Mother should provide the Father with copies of the relevant receipts and invoices of Z’s regular expenses, not on monthly basis as suggested by him, but rather quarterly instead. As the Mother is successful with her application, I agree that she should be entitled to her costs with certificate for counsel to be taxed if not agreed, which is a costs order nisi to be made absolute at the expiration of 14 days.

59.  I must however not end this judgment without saying this: The litigation between these 2 parents have gone on far too long, more than 4 years through 3 different courts and millions of dollars in legal costs over issues which are far from difficult or complicated legally but rather literally as common and mundane as bread and butter, and yet this decision of mine sadly is unlikely to bring any closure as it seems that further proceedings are looming albeit elsewhere in London, which have brought out some important and far-reaching legal issues which in my view desperately require to be addressed by legislation and serious soul-searching by our society.

60.  The Father no doubt would simply put the blame of what the Court of Appeal has described as a sorry state of affair on the Mother’s greed and inability to grasp the reality of her rights for financial relief within the boundary of the Guardianship of Minors Ordinance. I however like to think that she has merely been seeking justice from the court to redress something which she believes that both she and her daughter have been unjustly deprived of by our current law.

61.  In my earlier judgment I opined that the court’s powers under GMO to make financial provision for children born out of wedlock are much more limited than those available under the English Children Act which appeared to me unfairly and discriminatively restricted. While the Court of Appeal has in its subsequent appeal helpfully redressed that situation to some extent by clarifying the legislative intentions and adopting a wider interpretation to various provisions under section 10(2) of GMO to bring the court’s powers closer to those in the English statutes, but still there are significant gaps in our laws between legitimate and illegitimate children as far as their rights to seek financial provision are concerned.

62.  The most glaring examples can be found from the provisions under Matrimonial Proceedings and Property Ordinance, Cap 192 where the court’s powers to make any sort of financial provisions and at any time for a child of a marriage under sections 5, 6 and 6A are virtually without any restriction or limitation, while section 7 obliges the court not only to have regard to all those matters set out under subsection (2) in respect of the child of the marriage, notably in particularly the standard of living enjoyed by the family before the breakdown of the marriage ((2)(d)) and the manner in which the child was being and in which his parents expected him to be educated ((2)(e)), but also to exercise those powers as to place that child so far as it is practicable and just to do so in the financial position in which the child would have been if the marriage had not broken down. There are simply no similar provisions for an illegitimate child under GMO, and at best the relevant standard of living that such a child would be entitled is ‘to be brought up in circumstances which bear some sort of relationship with the father’s currentresources and the father’s present standard of living …’ – per Hale J in J v C (Child: Financial Provision) [1999] 1 FLR 152.

63.  All of these, I assume, were designed to guard against claims made on such a child’s behalf but with disguised element of providing for the mother’s benefit instead, for which she as a cohabitant only instead of as a wife has no right under our current law for financial relief generally for herself per se upon separation from the father notwithstanding that she may have been wholly or substantially dependent on him throughout their cohabitation no matter how lengthy it may have been, save for some relatively minor ones such as carer’s allowance but only when the facts of the case justify. As a result the mothers in many cases, as no doubt the one before me, would simply feel discriminatively aggrieved by the apparent injustice or unfairness so caused.

64.  This is particularly so, in my opinion, when there is a clear different or unfair level playing field between these cohabitants where one, usually the mother as in the case before me, has no or very little or limited earnings or financial resources and is obviously economically vulnerable or disadvantaged, and where the other, usually the father who may hold all the financial powers and resources throughout their cohabitation, and on their separation with the former very often left without the means to rebuild her life, let alone to obtain a fair share or division of the assets which she was allowed to use and enjoy prior to the breakdown of the relationship. To those ended up in such a predicament, there is clearly a strong sense of injustice and inadequacies in our current law.

65.  Such inadequacies in my view all the more cry out for the need to be addressed when one considers the fact that under Inheritance (Provision for Family and Dependants) Ordinance, Cap 481 a person who before the death of a deceased was being maintained either wholly or substantially by the deceased can apply for financial provision from his estate: section 3(1)(ix), which includes a dependent cohabitant. If it was accepted by legislation that such a cohabitant should accordingly be granted legal remedies on the death of the other cohabitant, I ask why should she/he not be so entitled when the other cohabitant is still alive? I am unable to think of any logical answer.  

66.  While it is recognised that any suggestion to grant legal remedies to cohabitants will no doubt be controversial and unwelcome to many for various reasons, but given the facts that cohabitation outside marriage in our society has become increasingly common over recent decades with increasing public acceptance, that the many problems and difficulties which have very often caused to some of these cohabitants and their children upon the breakdown of cohabitation, and the perceived inherent injustice that many feel being associated against them, it is time that some workable scheme or system should be put in place through legislation to help individual cohabitants and their children for financial provision and adjustment of property right between cohabiting couples on separation, which would have, I honestly believe, assisted the parties in this case to resolve their disputes much sooner, much more economically, and above all, with much less acrimonies between them.

67.  Lastly, it remains of course my gratitude to counsel for both parties for their most valuable assistance rendered to the court throughout the trial.

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 158 OF 2011

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BETWEEN

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 DECISION ON COSTS

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1.  On 22^nd January 2013 I delivered a judgment on the Applicant Mother’s application for custody and maintenance for her child Z under section 10 of Guardianship of Minor Ordinance, Cap 13 (GMP) after a 6 days hearing, of which all but perhaps only the morning of the first day were spent on her claims for financial provision for Z, with an order granting custody to her jointly with the Respondent Father with care and control to her and certain defined access to him, and for him on certain undertakings to pay her a total sum of HK$118,000 per month for Z until she reaches 18 or ceases full-time tertiary education whichever is later.

2.  The Mother now seeks an order for the Father to bear all her costs of which I understand to be in excess of HK$4.2 million, while the Father, who has incurred more than HK$5.6 million on his own legal costs, argues that the proper decision should be no order as to costs. Whichever way my decision goes, the fact that the parties have incurred close to HK$10 million in combined legal costs seems to me wholly unjustifiable and disproportional to the issues before the court which, apart from some relatively minor ones in respect of the Father’s access entitlement, were essentially over the reasonable needs of Z barely 2 years old at the beginning of the application, and sadly reveals again what is terribly wrong with the way such matters are being litigated in this jurisdiction, about which no doubt I will have more to say later in this decision.             

3.  Ms Irving, counsel for the Mother, argues that while neither party was the outright winner in the judgment, this is a case where an order for cost in the Mother’s favour is warranted given the fact that she was obliged to bring these proceedings and to come to court for the order for financial provision, and that there is a vast disparity in the means of the parties, with the Father taking the millionaire’s defence able to meet the highest claim of the Mother, who on the other hand has been unable to pay her legal costs for proceedings that she was obliged to take to maintain her child.

4.  Mr Coleman for the Father on the other hand submits that there are strong arguments that the Father is properly to be regarded as having succeeded in the litigation due to the Mother’s unreasonably high demands as well as unreasonable litigation conduct, but that he is prepared to accept that no order as to costs is the practical correct order to make in this case, and in particular taking into account of his earlier voluntary payment of HK$750,000 provided for the Mother to meet at least her counsel’s fees for the trial.

5.  Before going into more details of the parties’ respective arguments and their merits, however, it would be relevant to first give a bit more factual background of the case leading to my said judgment, as well as the applicable principles on the question of costs in particularly in so-called children cases, of which this is one.

Background

6.  The full details can be found in my said judgment, and I do not propose to repeat them here, save for the following which are relevant to the matter now before me.

7.  The parties started to cohabite in May 2006 at the Father’s apartment in Convention Plaza together with the Mother’s elder daughter N born from her previous marriage, and Z born during the cohabitation on 8^th March 2009, in what was described in my judgment a high standard of lifestyle and living, and during which the Mother and Z were wholly dependent on the Father, and to certain extent N was as well.

8.  The cohabitation ceased in August 2010 when the Mother moved into another apartment at Convention Plaza with the children arranged by the Father who continued to support them as the parties remained on amicable term until an incident in May 2011 which involved the police, and in July 2011 the Mother moved to her current apartment at Bel-Air with the children. Thereafter the Father stopped maintaining the Mother or N altogether, and paid the Mother HK$67,000 per month being HK$20,000 for Z and HK$47,000 towards the monthly rental of her Bel-Air apartment which stood at HK$76,000 at that time. He also cancelled her credit card or the use of his car or driver.

9.  On 4^th July 2011 the Mother launched these proceedings for custody care and control of Z and for financial provision for her including lump sum and periodical payment as well as interim maintenance at the rate of not less than HK$180,000 per month. By the time of the trial in September 2012, the Mother had quantified her claims for Z as follows:

(a)  a lump sum of HK$32 million for purchasing accommodation;

(b)another sum of HK$700,000 for decoration and furnishing;

(c)  a further sum of HK$500,000 for purchasing a Mercedes Benz;

(d)a periodical payment of HK$174,652 per month being HK$85,250 for general household expenses, HK$13,884 for Z’s personal expenses, and HK$75,518 for the Mother’s personal expenses as well as for N;

(e)  and for the Father to continue to be separately responsible for Z’s school fees and other educational expenses as well as her insurance premium.          

10.  These claims of the Mother for lump sums were rejected by the Father for want of jurisdiction under the said Ordinance, who also found her various proposed figures for the periodical payment for Z excessive, unnecessary or unreasonable, and counter-proposed a monthly sum of about HK$90,000 on the basis that her then boyfriend was not residing with her, plus various provisions for Z’s holidays expenses and additional extra-curricular activities. He also proposed to pay, and did pay HK$750,000 as contribution towards the Mother’s costs of her application.

11.  As referred to above, after a 6 days trial I rejected the Mother’s claims for various lump sums but awarded her a monthly sum of HK$118,000 being HK$80,000 for rent and utilities, HK$13,000 for Z’s personal expenses, and HK$25,000 for the Mother’s carer allowance, on the basis that the Father shall continue to be directly responsible for Z’s school fees, extra-curricular activities, medical insurance and holiday expenses. I also reserved the question of costs, which is the matter now before me. These being the relevant factual background, I shall next turn to the applicable principles of which it does not seem seriously controversial between the parties.          

Applicable Principles

12.  The general principles in civil litigations are derived from the English case of In re Elgindata Ltd (No.2) [1992] 1 WLR 1207, and have since been adopted by our courts, are as follows:

(a)  Costs are in the court’s discretion;

(b)They should follow the event excepts when it appears that in the circumstances of the case some other order should be made;

(c)  The general rule does not cease to apply simply because the successful party raises issues or makes allegations on which he fails, but where that has caused a significant increase in the length or cost of the proceedings he may be deprived of the whole or part of his costs;

(d)Where the successful party raises issues or makes allegations improperly or unreasonably, the court may not only deprive him of his costs but may order him to pay the whole or part of the unsuccessful party’s costs.

13.  While these principles apply equally in contested family proceedings, they may be displaced more easily in the Family Court, but the starting point is still that costs prima facie follows the event, as Butler-Sloss LJ, as she then was, said in Gojkovic v Gojkovic [1992] Fam 40 at 54:

“That starting point, in my judgment, is that costs prima facie follow the event (see per Cumming-Bruce LJ in Singer (formerlySharegin) v Sharegin [1984] FLR 114, 119) but may be displaced much more easily than, and in circumstances which would not apply, in other Divisions of the High Court. One important example is, as the judge pointed out, that it is unusual to order costs in children cases. In applications for financial relief the applicant (usually the wife) has to make the application in order to obtain an order by consent; and if money is available and in the absence of special circumstances, such an agreement would usually include the applicant’s costs of the application. If the application is contested and the applicant succeeds, in practice in the Divorce Registries around the country where most ancillary relief applications are tried, if there is money available and no special factors, the applicant spouse is prima facie entitled to, and likely to obtain, an order for costs against the respondent. The behaviour of one party, such as in material non-disclosure of documents, will be a material factor in the exercise of the court’s discretion in making a decision as to who pays the costs.”

14.  In cases relating to children, and in particularly over their custody and access arrangements, however, the proposition from case-law seems to be that it is unusual to order costs against a party, according to Rayden and Jackson on Divorce and Family Matters, 18th edition, in Chap 52.21:

“A number of reasons are advanced in the case-law for the practice of no order for costs in children cases. In all family proceedings, an order for costs inevitably diminishes the funds available to meet the needs of the family. Proceedings to determine the future of a child are partly inquisitorial and the focus is the best interests of the child. The court does not wish the prospects of a costs order to discourage those with a proper interest from participating reasonably in the proceedings and debate. An order for costs may exacerbate tensions between parents and diminish the likelihood of future co-operation between them, to the disadvantage of the welfare of the child.”

15.  The court however does retain the discretion to award costs in suitable cases, and in Keller v Keller and the Legal Aid Board [1995] CA, 1 FLR 259, Wilson J examined how such discretion should be exercised, starting at p264C:

“What general considerations, if any, guide the exercise of the court’s discretion in deciding whether to make an order for costs in proceedings relating to children? In Gojkovic v Gojkovic (No.2) [1992] Fam 40 at p57C Butler-Sloss LJ said:

‘It is unusual to order costs in children cases.’

And at p60C she said:

‘The concept … of no order for costs where both parents have been reasonable in their approach to the dispute is not, in my judgment, one of general application in the Family Division, save in children cases.’

In London Borough of Sutton v Davis (Costs)(No.2) [1994] 2 FLR 569 at pp 570H – 571B, I sought to explain the reasons for the proposition that orders for costs in children cases are unusual. With diffidence, I repeat what I then said:

‘Where the debate surrounds the future of a child, the proceedings are partly inquisitorial and the aspiration is that in their outcome the child is the winner and indeed the only winner. The court does not wish the spectre of an order for costs to discourage those with a proper interest in the child from participating in the debate. Nor does it wish to reduce the chance of their co-operation around the future life of the child by casting one as the successful party entitled to his costs and another as the unsuccessful party obliged to pay them. The proposition applies in its fullest form to proceedings between parents and other relations; but it also applies to proceedings to which a local authority are a party.’

The practice of making no order as to costs in children cases seems to have grown steadily during the last 30 years, in the vacuum created by the demise of the principle that the costs of a wife, even if unsuccessful, should ordinarily be met by the husband. As early as 1965, in Re B (Infants) [1965] 1 WLR 946 at 948D, concern was expressed that no order for security of costs should be made which would prevent a parent from putting his views before the court. And as early as 1968, in B(M) v B(R) [1968] 1 WLR 1182 at p 1185H, this court suggested that it would have been wrong to make an order for costs because it would exacerbate feelings between the parents, to the ultimate detriment of the child. Even by 1982, however, the practice was still very fluid. In Re G (Official Solicitor’s Costs) [1982] 3 FLR 340 at p 345B Ormrod LJ said:

‘Where the proceedings are between the parents, both of whom are acting bona fide in the interests of the child, it is not uncommon to make no order as to costs of the proceedings.’

These words are less firm than the recent observations of Butler-Sloss LJ in Gojkovic (above) to which I have already referred.

No one suggests that the court’s discretion in respect of costs under s 51(1) of the Supreme Court Act 1981 has become emasculated in children cases. The position is only that in most such cases, indeed in ordinary cases, the proper weighing of the factors in the exercise of the discretion is likely to lead to the choice of no order inter parties. Where, for example, the conduct of a party has been reprehensible or his stance in the litigation has been beyond the band of what is reasonable, an order for costs might well be made against him. Equally a marked disparity in wealth, such that, for example, the wife’s costs would bear harshly upon her economy but could be discharged by the husband without significant impact upon his economy, might give rise to an order against him.”  

16.  Neill LJ sitting in the same Court of Appeal concurred at p267H:

“In the last decade, however, it has become the general practice in proceedings relating to the custody and care and control of children to make no order as to costs of the proceedings except in exceptional circumstances. In London Borough of Sutton v Davis (Costs) (No.2) [1994] 2 FLR 569 at p570H Wilson J threw some useful light on the reasons for the present practice, the existence of which was recognised in this court by Butler-Sloss LJ in Gojkovic v Gojkovic (No.2) [1992] Fam 40 at 57C.

The court of course retains the jurisdiction and a discretion to award costs in suitable cases. It is unnecessary and undesirable to try to limit or place into rigid categories the cases which a court might regard as suitable for such an award, but examples would be likely to include cases where one of the parties had been guilty of unreasonable conduct or where there was such a disparity between the means of the parties that a specific order was justified.”

17.  These principles have been applied and adopted by our courts in cases involving children, as in H v H [2002] CACV 42/2002, HKEC 1123 where Rogers VP said in the Court of Appeal at para 19:

“ … It would seem that this approach has been followed in respect of appeals to the Court of Appeal. Whilst different considerations may apply to appeals because the parties have had the benefit of ‘one day in court’ and thus costs can be unnecessarily incurred, I consider that unless it could be said that an appeal should never have been brought then the same principles would be applicable. Indeed, the argument on behalf of the respondent is put on the basis that the ‘appeal had very little prospect of success.’ Whilst I have had no difficulty in reaching the conclusion as to the outcome of the appeal, I would in this case still apply the same principle in relation to costs, primarily for the reason that it is in the daughter’s interest that there be as little antagonism between the parties as possible. It is to be hoped that the parties can now work together in the daughter’s interest and avoid returning to court to continue battles over custody, care and control which hopefully will have been resolved. The order I would make therefore be that there be no order as to costs.”

18.  It is therefore clear from these principles that while it is in the unfettered discretion of the court, when it comes to costs over the custody care and/or access arrangements of a child, the appropriate order would normally be no order as to costs, but as for claims for financial provision for a child,  the starting point is for costs prima facie to follow the event, which may however be displaced by an order against a party who had been guilty of unreasonable conduct or where there was such disparity between the means of the parties that a specific order would be fair or justified.

Costs Arguments

19.  As noted above, it is Ms Irving’s submission that this is such a case where an order for costs in the Mother’s favour in both the child’s care arrangements and financial provision is warranted essentially for the following reasons.

20.  Firstly, she argues that given the facts that the trial was to cover both matters, with evidence on both issues to be dealt with together and not separately, and that agreement on custody, care and control as well as access was only reached outside court on the morning of the first day of trial, and that since the Mother was obliged to bring the application for the benefit of the child so that proper assurance as to the Father’s fitness to have the child in his care during access could be provided given the history of his drug use, and hence while several orders were made along the way for the Father’s access to Z, they were either contingent on an undertaking given by his mother to be present at all times, or on his undertaking to ensure that the Chinese governess employed by the Mother be present at all of his access, cumulating in the order made at the trial on 14th September 2012 inter alia for the Father to have hair drug tests every 3 months up to March 2013 to ensure that he would remain drug free, hence she submits that the application was necessary to safe guard the interests of the child, and the Mother is therefore entitled to her costs instead of the usual no order.        

21.  There was never any challenge by the Father to the Mother’s claim for care and control of Z, as he only sought her joint custody with the Mother and reasonable access including staying access. Joint custody was eventually acceptable to the Mother, and the only real issue for the trial was over her concern of the Father’s past drug use and its effect on Z’s safety and welfare in particular during his staying access to her. While the Father did strenuously deny that he was still using drug, he was ready and willing to undergo those tests demanded by the Mother so as to alleviate her concern, and which did show that he has remained drug free, hence they both can be said to have acted bona fide in the interests of their child, and it cannot in my judgment be justified to make a costs order against the Father as far as the care arrangement for the child is concerned.     

22.  As for the costs of the much more contentious part of the application for financial provision for the child which as noted above took up the bulk of the trial, the Mother’s argument again is that she had no choice but to bring proceedings as she found the offer made by the Father derisory, which was then only HK$76,500 per month including HK$38,000 for rent, when she was already paying HK$76,000 for her accommodation, and that it was only at the trial that he increased the sum to HK$47,000 for rent after he was satisfied that she was not cohabiting with her boyfriend, it was late in the day as her costs had already been incurred, and in any event still far from sufficient as found by the court in the said judgment.

23.  Furthermore, Ms Irving argues, that the Father’s approach to the litigation had been oppressive given that he held all the financial cards, such as demanding a paternity test at the commencement of the proceedings, having the Mother and her then boyfriend followed and spied on by his private investigators, and as his refusal to produce un-redacted copies of his credit card statements that the Mother was put to the costs of bringing the matter to court, all of which she argues would justify an order of costs in her favour.

24.  Mr Coleman on the other hand submits that there are in fact strong arguments that the Father, rather than the Mother, is properly to be regarded as having succeeded in the litigation, as it is clear from the Appendix A to his Skeleton Argument a schedule identifying her demands over the course of the correspondence and the proceedings, that the Mother’s financial demands started too high, but only increased as time wore on, that she was constantly ‘moving goalposts’ in her demands, and that there are other areas identified in the said schedule where costs were unnecessarily or unreasonably incurred or triggered by her, such as her very lengthy 1^st affidavit filled with scandalous and unnecessary allegations, or filing of other irrelevant or peripheral materials or for financial disclosure of information which was irrelevant or never used.

25.  As noted above her open proposal before the trial sought a lump sum of HK$32 million for a property, various smaller sums for decoration and a Mercedes as well as maintenance of over HK$174,000 per month, while in her without prejudice offer made after the trial on 9^th October 2012 she may have come down somewhat to HK$28 million for the lump sum and HK$145,000 for the monthly maintenance, and while the award under the judgment of HK$118,000 per month inclusive of the costs of accommodation was higher than the Father’s offer, Mr Coleman submits that it was still much closer to his offer than to the Mother’s demands, and that the structure of the award, i.e. to include rent and no lump sum for purchase of a property, was in line with the Father’s suggested approach. Nevertheless, he is prepared to accept that no order as to costs would be the correct order to make in this case.               

26.  While I do not agree that having surveillance on the Mother and her then boyfriend was necessarily oppressive on the part of the Father as he was entitled to investigate whether they were then cohabitating and hence the boyfriend would have been making financial contribution towards the Mother’s rental and household expenses, and thereby impacting on her claims,  I do however accept that the Father could be criticised for his approach to the issue over the standard of living which the parties enjoyed during their relationship, or with some of his financial disclosure, as reflected in my judgment.

27.  On the other hand, criticism may also be levelled against the Mother not only for her unrealistically high demands as noted above by the Father, but also for her approach with her application as if they were the full spectrum of ancillary relief claims in a divorce suit not just for herself but also for her other daughter N, to both of whom she knew very well that the Father, rightly or wrongly, owes no legal obligation under the existing legislation, starting from the very first day of the proceedings with her 400 pages supportive affidavit and exhibits referred to above, with seemingly little concern about her legal costs and seemingly belying her present argument of vast disparity in wealth between her and the Father.                 

28.  There is no question in my mind of that disparity given the parties’ respective financial disclosure at the trial and my findings of their means in my judgment, which makes it all the more difficult to understand why the Mother had not bother to seek legal aid throughout the entire proceedings if not from the first moment when she realised that her application was going to be opposed, which caused the Father to question whatever arrangements she had made with her solicitors, the details of which he says that she has not informed the court but suspects that she may have sources, other than her latest 11^th Affidavit of 17^th September 2013 when she claimed to have paid a total of HK$1,250,000 towards her costs mainly from the voluntary payment of HK$750,000 from the Father and HK$480,000 borrowed from her parents, leaving still some HK$3 million outstanding.    

29.  Whatever arrangement the Mother may have with her solicitors over her costs, of which the Father suspects may in fact be funded by her boyfriend but without offering any proof, or whether she should have applied for legal aid in the first place, of which she claims she would not have been qualified, they should not in my view detract from the fact that it is within the court’s unfettered discretion to make a costs order in her favour if the marked disparity in wealth between the parties may indeed cause the Mother’s costs to bear harshly on her economy but could be discharged by the Father without significant impact upon his, and that it would in all the circumstances of the case be fair to do so, as it was said in Kellerv Keller and Legal Aid Board supra.

30.  Ms Irving argues that since the court should act in the best interests of the child, not ordering costs would undo the substantive order the court has made, as the Mother would otherwise be left crippled financially as a result, which is bound to be detrimental to the welfare of the child who lives with her and is inevitably affected by the Mother’s financial predicament, which was the basis, Ms Irving submits, that the court in the case of LGA nee P v LKKD [FCMC 13921/2010] ordered costs in favour of the wife notwithstanding its finding that she was guilty of making unreasonable demands for an unrealistic award with no regard to the husband’s true financial position.

31.  In that case Deputy Judge Carlson awarded a lump sum of GPB900,000 to the wife after a short marriage for purchasing a suitable home for herself and the 2 children of the family but which amount was exceeded by the parties’ total legal costs incurred, and hence the wife sought an order for the husband to bear all her costs of the proceedings. In his ruling on costs dated 15 July 2013, the learned judge laid most of the blame of the high legal costs on the parties’ contest on discovery at para6 of his judgment:

“But what has done most harm is the contest on discovery. I have said this elsewhere in this case, which is that the wife and her solicitors had persuaded themselves that the husband, being a member of a wealthy extended family, must have an awful lot of money somewhere, which he was hiding and which they were determined to winkle out. This in itself is bad enough but, as the litigation progressed the hostility between the parties and unfortunately, their respective solicitors increased. The reason put forward for this part of the costs bill is that because the husband was not forthcoming it has to be accepted that the wife’s solicitors were duty-bound to keep returning for yet more disclosure. This pressure did have the effect of producing a number of undisclosed bank accounts, although what was in them did not in the event change the landscape. The final test as to whether this pressure was justified must be the ultimate result of the disclosure. By the time that I had come to write my judgment I was satisfied that disclosure was sufficient although, Mrs Irving’s response to this is that, if it was sufficient this was because of the pressure that had been and, had to be applied to produce it.”

32.  He was then critical of the wife for her unrealistically high demands against the husband at para30:

“Whilst the details of the process of litigation is very important and it is this which goes to make up the overall picture, it seems to me important to stand back and ask the question ‘who has done better?’. In this case there is no clear-cut winner, if that is an expression that should be used in a case where the court was not only trying to be fair to the parties themselves but also to their two young sons. Nevertheless, having posed this question for myself I propose to answer it and, it seems to me that the husband has done rather better than the wife. Whilst he was somewhat ungenerous, in my view, on capital by suggesting that she should take what was offered and go and live in Purley near her mother, he was prepared to be more generous on maintenance than the court ultimately ordered. The overall impression of this case, I am afraid to say, is of the wife, very well supported by her solicitors, trying to squeeze as much out of the husband as possible. Whilst it might be said that this is what most litigants do in every case, this particular application has been driven to completely unrealistic boundaries to the extent that on occasions, as I read and then heard the evidence in court, I considered that greed pure and simple was the main driving force. That is a harsh assessment of the wife and mother who has displayed great pluck, courage, love and understanding for her children’s needs specially towards R but, when it came to translating her needs as she saw them into money, the case turned into a campaign to take the husband for everything that he had. I found her initial demands unattractive. It was only when the case came to its conclusion that those demands, certainly on capital, were trimmed to something that was understandable and far better judged.”

33.  Nevertheless the learned judge awarded her the majority of her costs and explained his decision at para33:

“Even now the wife says she should have all her costs taxed on an indemnity basis, this when she has been awarded far less than she was pushing for until very late in the case, only when Mrs Irving got to her feet to make her final speech. In terms of pure merits having regard to the outcome the best that I believe she would be entitled to is to bear all her own costs – therefore no order as to costs. But I am afraid that such an order would completely undo what I have now put in place for the children and in consequence for the wife herself. Her costs are so substantial that most of the lump sum would go if she had to pay for her own costs and such a result cannot be right. As it is, she is having to already bear some of her costs from interlocutory orders and an element for costs ordered against her.”

34.  And at para36:

“I have decided that the only way to safeguard the children’s position is to order the husband to pay the great majority of the wife’s costs. I do not think for one moment that this is a just outcome as between the parties themselves but I must preserve the lump sum, I hope in its entirety. The husband will pay 78% of the wife’s costs. Such an order will almost inevitably result in the wife having to sell Regents Park unless she can find funds elsewhere to pay for her 22% and in addition the costs which she is separately having to bear as ‘no order for costs’ and those other orders where I had ordered her to pay the husband’s costs.”

35.  In my earlier judgment criticisms were also made of the Mother for her unrealistically high demands throughout the proceedings, and for that matter of the Father too about his disclosure, and whilst it is true that they are as submitted by Mr Coleman more reasonably balanced and certainly nowhere as serious, but if this argument of marked disparity in wealth between the parties is to be run to justify the Mother’s claim for costs, the question must still be whether an ‘no costs’ order would undo the award as was the main concern of the learned judge in that case, or bear harshly on the Mother’s economy as per Wilson J in Kellersupra?        

36.  As submitted earlier by Mr Coleman, the Mother has never fully or properly disclosed what arrangements she had made with her lawyers to enable her to conduct her litigation over the past 2 years having allegedly only met a quarter of her total costs, of which the bulk had come from the Father’s voluntary contribution of HK$750,000 only shortly before the trial, and with not even an attempt to apply for Legal Aid at any stage of the litigation up to the judgment on her application. Without such proper disclosure on her part, is one simply to assume that hardship will surely bear upon her around the corner, or that the court’s award for the child will all be undone by all being handed over to her lawyers to settle her costs?

37.  Unlike in  LGA nee P,  here there is no lump sum payable to the Mother which she may use to settle her costs and thereby undoing its purpose intended by the judgment, while the bulk of the periodical payment of HK$118,000 per month payable to her by the Father under my judgment was for her monthly rental, and the rest was financial provision for Z, leaving only her carer allowance of HK$25,000 which could realistically be used to meet her costs, but at its alleged outstanding amount it would take more than 10 years to pay off, and it is highly doubtful that that would be something which she and her solicitors could agree.

38.  However, whatever arrangement she may have with her solicitors over her costs, and barring the most unlikely possibility of them being waived, given their substantial amount I agree they will impact significantly on the Mother financially or otherwise, and inevitably also on Z, it would therefore be appropriate for me to return to her first argument: that she was obliged to come to court for the order of financial provision for her child, and that although the final award was way short of her claims, it was nevertheless still more than what the Father had offered, and in the absence of any other without prejudice offer which would have protected him on costs, I agree with Ms Irving that the Mother should be entitled to a costs order in her favour, albeit not in its entirety.

39.  As already referred to above, the Mother was guilty of maintaining such unrealistic demands throughout the proceedings that had prevented any possibility of settlement or compromise between the parties which must be one of the main cause for the staggering amount of combined legal costs of close to HK$10 million, hence in my view it would not be fair for the Father to shoulder up all her costs of her application, and taking into account also of the fact that part of those costs were over the child’s custody arrangement of which there should be no order, in conclusion and for all the reasons articulated above, I believe that a fair and appropriate order would be for the Father to bear 70% of the Mother’s costs, of which I believe will not impact on his economy, to be taxed on party & party basis if not agreed, and with credit to be given for the HK$750,000 already paid. Lastly and again my gratitude to both counsel for all their assistance rendered to this court. 

Ms Frances Irving instructed by M/S Oldham, Li & Nie for the Applicant.

Mr Russell Coleman SC instructed by M/S Mayer Brown JSM for the Respondent.

IN THE DISTRICT COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

MISCELLANEOUS PROCEEDINGS NO. 158 OF 2011

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___________________

BETWEEN

___________________

______________________

J U D G M E N T
(Financial Provision for a Child of Unmarried Parents)

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1.  This is the Applicant Mother’s application under s 10(2) of Guardianship of Minors Ordinance, Cap 13 (GMO) for the maintenance and benefit of her daughter Z, now 3 ½ years old born out of her cohabitation with the Respondent Father which ended in August 2010. The Mother is essentially seeking the provision of a property to be purchased by the Father for about HK$32 million to be held in trust for Z until she is adult, or in the alternative to be held for occupation by Z until she reaches the age of 18 or completes full time education, plus a lump sum towards furnishing and equipping such a property and for purchasing a car, as well as a monthly sum of just over K$174,000 for Z’s maintenance including her carer’s allowance, on the basis of what the Mother claims to be an extremely lavish lifestyle when the parties lived together and that the Father is financially well capable of making those provisions.            

2.  The Father, who has relied on the ‘millionaire defence’ that he can meet the highest claim of the Mother so as to avoid a lengthy and expensive discovery process of his means other than filing his Financial Statement (Form E) and producing some of his credit card statements, accepts that he should make appropriate and reasonable financial provision for his daughter but objects to what he claims to be attempts by the Mother to inflate her claims to a figure far beyond any reasonable level of maintenance which he says just kept going up throughout the proceedings.     

3.  In addition the Father also takes issue with the Mother over the court’s power under section 10(2) of GMO to make the kind of lump sum order which she seeks for the purchase of a property as the provision of accommodation for Z, which turns on the question of how that section relevant to the Mother’s claim should be construed.           

Background

4.  Both parties are British, with the Mother now aged 33 and the Father 39. After the Mother completed her university studies, she worked as a fashion model and travelled around the world on her jobs. In 2003 she married a film director from Thailand with whom she gave birth to a daughter N in 2004. Two years later she divorced N’s father and obtained N’s custody. By then she was dating the Father who had moved from London to Hong Kong in the 1990s where he had set up his fashion accessories business.    

5.  Upon finalizing her divorce with N’s father in September 2006 the Mother moved with N into the Father’s apartment at Convention Plaza Apartments, and it seems that he had then assumed financial responsibility for N during his relationship with her mother. On 8^th March 2009 the Mother gave birth to Z.

6.  That relationship ended in August 2010 but on amicable terms when the Father rented a 2-bedrooms apartment at Convention Plaza for the Mother and her two daughters, and continued to meet their expenses including allowing the Mother to continue to use his American Express credit card. However, what remained of that relationship came to an end in May 2011 after an incident when the Father removed both children to his apartment without the Mother’s consent which required the intervention of the police before the children were returned to the Mother.

7.  Following the Father’s subsequent cancellation of her credit card and ceasing to be involved with N, and allegedly had her followed by his private investigators over some period of time, the Mother moved from the Convention Plaza Apartments in July 2011 with the children and her 2 domestic helpers to her current 3-bedrooms apartment in Bel-Air, Pokfulam under a 2-years lease at a monthly rent of HK$76,000. The Father was then paying her HK$67,000 per month calculated at HK$47,000 being the rent which he paid for her former Convention Plaza Apartment and HK$20,000 as maintenance for Z plus direct payments for her school expenses, extra-curricular activities and the salary of the helper, of which the Mother claims to be grossly insufficient and was forced to meet her monthly deficits with her savings and later borrowing from her father and sister.

8.  Almost immediately after her move to the Bel-Air apartment, the Mother launched these proceedings seeking custody of Z and financial provision for her during her minority. In support of her case she then filed an affidavit of more than 400 pages including exhibits setting out the history of her relationship with the Father with such details which I find mostly unnecessary, immaterial or irrelevant, and which served no useful purpose but certain to provoke tensions and hostilities between the parties, not to mention inflating legal costs. Clearly a practice that should not find favour with the court.

9.  In his Form E filed on 1^st November 2011 in response to the application, the Father disclosed his interests through various companies holding 6 properties at Convention Plaza Apartments including his present residence and a factory unit in Cheung Sha Wan, some jointly with his mother and some on his own, as well as a property in London in his sole name, plus various directorship and/or shareholding interests in 11 companies including some of those holding the above properties, bank savings and other personal items including arts and watch collections, with a total net worth which he put at over HK$35 million before taking into account of his shareholding interest in his business. He also disclosed an average monthly income of almost HK$100,000 including housing allowance plus the use of motor car provided by his main company which as noted above is a fashion accessories manufacturer and which also pays for his domestic helper, with a monthly expenditure of just over HK$185,000 including his various payments for Z.   

10.  The Mother of course does not accept any of those figures accurately reflect the true wealth of the Father, and in any event on 6^th March 2012 she obtained an order for interim maintenance at the rate of HK$120,000 per month including for her rental expenses, and for the Father to continue with those direct payments for Z’s schooling as before without prejudice to their respective case at the trial.

11.  The issues that eventually came before the court at the trial starting on 10^th September 2012 were those of joint custody and access of Z as well as financial provision for her. While there was never any dispute that her care and control should remain with her, the Mother sought her sole custody while the Father asked for joint custody and unsupervised access. Fortunately before the trial commenced, they were able to reach agreement to have joint custody on certain terms, of which it is not necessary to go into here, and for the Father to have certain staying access on weekends and holidays, which were subsequently incorporated in an order of the court on 14^th September 2012, with the remaining issue on her financial provision to be determined at the trial, during which the Mother was represented by Ms Francis Irving, while the Father by Mr Russell Coleman SC.

12.  It would be relevant to set out here the Mother’s open proposal at the trial (CB: 622):

13.  As noted above, the Mother also seeks additional sums of HK$700,000 for decorating and furnishing the property to be purchased, and HK$500,000 for purchasing a car.

14.  The Father’s open proposal is in his solicitors’ letter dated 20^th August 2012 (CB2: 569) which can be summarised as follows:

(a)  that he will pay a monthly maintenance for Z partly direct to the Mother, and partly in direct settlement of expenses, in the total sum of HK$76,500 – 78,500 per month comprising of the following:

(i) Rent and utilities :	HK$38,000
(ii) Local travel :	HK$1,000
(iii) Food :	HK$2,000
(iv) Clothing, toys and presents :	HK$2,500
(v) Carer’s allowance :	HK$10,000
(vi) School fees including lunch :	HK$12,634
(vii) School bus :	HK$980
(viii) Ballet classes :	HK$3,500
(ix) Medical insurance :	HK$2,000
(x) Domestic helper’s salary :	HK$5,800

(b) that he will pay for 2 economy class round-trip tickets per year and HK$600 per day for Z’s daily expenses on holiday for up to 2 weeks per trip as his contribution towards her holiday expenses;

(c)  that he will provide annual passes for Ocean Park and Disneyland to be shared with the Mother for their use during their respective time with Z;

(d) That he is willing to pay directly the reasonable costs of any additional extra-curricular activities that Z requires or would like to enrol in including Mandarin lessons.           

15.  It must be mentioned that the Father’s proposed figure for rental and utilities of HK$38,000 was made on his belief that the Mother was then cohabiting with her boyfriend who should be contributing his share towards those expenses, but if the court finds that that is not the case, he says he would be prepared to raise his rental payment up to HK$50,000 directly to the landlord, thus bringing his proposal to a total sum of HK$88,500 to $90,500 per month.       

16.  Still the gulf between the parties’ proposal was wide enough to ensure that a trial was inevitable over what is essentially the reasonable needs of a small child for now and the near future having regard to the means of the Father. However, before proceeding to consider the issue and the evidence before the court, I must say that it seems insane to me that the parties would see fit to incur total legal costs in excess of HK$6 million between them, a staggering sum even by the Father’s standard, and which would have been more than sufficient to meet the Mother’s claim for Z’s monthly maintenance at the highest for more than 3 years.                       

Applicable Principles

17.  The Mother’s application is as noted above made under section 10(2) of GMO, and there is no dispute that it is a discretionary jurisdiction with the test being what the court thinks ‘reasonable’ having regard to the means of the Father, but given the legal issue between the parties over the court’s jurisdiction to make the kind of lump sum order sought by the Mother, it would be relevant to first set out the relevant subsection in full:

“(2) The court may as regard a minor, on the application of a person with whom, whether by virtue of an order under subsection (1) or otherwise, custody of the minor lies at law, make in respect of the minor any one or more of the following orders –

(a) an order requiring payment to the applicant by the parent or either of the parents of the minor of such lump sum (whether in one amount or by instalments) for the immediate and non-recurring needs of the minor or for the purpose of enabling any liabilities or expenses reasonably incurred in maintaining the minor before the making of the order before the making of the order to be met, or for both, as the court thinks reasonable having regard to the means of that parent;

(b) an order requiring payment to the applicant by such parent or either of such parents of such periodical sum towards the maintenance of the minor as the court thinks reasonable having regard to the means of that parent;

(c) an order requiring the securing to the applicant by such parent or either of such parent, to the satisfaction of the court, of such periodical sum towards the maintenance of the minor as the court thinks reasonable having regard to the means of that parent;

(d) an order requiring the transfer to the applicant for the benefit of the minor, or to the minor, by such parent or either of such parents, of such property, being property to which the parent is entitled (either in possession or reversion), as the court thinks reasonable having regard to the means of that parent;

(e) an order requiring the settlement for the benefit of the minor, to the satisfaction of the court, of such property, being property to which such parent or either of such parents is so entitled, as the court thinks reasonable having regard to the means of that parent.

18.  It is under subsection (2)(a) that the Mother seeks an order for the provision of a property for Z, as it is Ms Irving’s submission that the lump sum order stipulated there can be used for the provision of housing, and that once housing is provided, the need does not recur. Alternatively, she submits that under (2)(e) the court can order that a property be purchased on trust for Z during her minority reverting to the Father, and not necessarily just a property that he already owns.   

19.  That last point is significant in that the Mother has made it abundantly clear that she would not consider any of the existing properties at Convention Plaza Apartments in which the Father is interested as she does not want to live that close to him, and that she prefers the same type of property in which she is now renting at Bel-Air.

20.  In support of her argument Ms Irving relies on the definition of the word “property” in Matrimonial Causes Ordinance, Cap 179 (MCO) and Matrimonial Proceedings and Property Ordinance, Cap 192 (MPPO) as follows:

“property” means any real or personal property, any estate or interest in real or personal property, any money, or negotiable instrument, any prescribed instrument within the meaning of section 137B of the Banking Ordinance (Cap 155), debt or other chose in action, and any other right or interest whether in possession or not.

Ms Irving argues that while there is no such interpretation in the GMO, logically the same interpretation prevails.  

21.  She further submits that while the English legislation in relation to financing for children, the Children Act 1989, is somewhat different from the Hong Kong legislation, the wording in the English Act Schedule 1 relied on for providing funds for the purchase of a property in trust is not materially different from the GMO, which is as follows:

“(1) On an application made by a parent or guardian of a child, or by an person in whose favour a residence order is in force with respect to a child, the court may –

(a)… make one or more of the orders mentioned in sub-paragraph (2);

…

    (2) The orders referred to in sub-paragraph (1) are –

(a) an order requiring either or both parent of a child –

(i)  to make to the applicant for the benefit of the child; or

(ii)  to make to the child himself,

such periodical payments, for such term, as may be specified in the order;

(b) an order requiring either or both parents of a child –

(i)  to secure to the applicant for the benefit of the child; or

(ii)  to secure to the child himself,

such periodical payments, for such term, as may be so specified;

(c)  an order requiring either or both parents of a child –

(i)  to pay to the applicant for the benefit of the child; or

(ii)  to pay to the child himself, such lump sum as may be so specified;

(d) an order requiring a settlement to be made for the benefit of the child, and to the satisfaction of the court, of property –

(i)  to which either parent is entitled (either in possession or in reversion); and

(ii) which is specified in the order;

(e)an order requiring either or both parents of a child –

(i) to transfer to the applicant, for the benefit of the child; or

(ii) to transfer to the child himself, such property to which the parent is, or the parents are, entitled (either in possession or in reversion) as may be specified in the order.

22.  With the above 2(d) as the relevant provision for settlement of property, Ms Irving submits that the difference in wording from section 10(2)(d) of GMO is of no substance, as both talk of  “ … settlement … for the benefit of the child/minor … of property … to which either parent is entitled.”  

23.  In support of her argument, Ms Irving relies on the judgment of HH Judge Chu in the case of Hv S (Financial Provision for a Child of Unmarried Parents) [2012] HKFLR 236, where the father had agreed to purchase the child’s accommodation, the mother nonetheless asked that the property be held in trust to revert to the father when the child reached 18 or ceased full-time education, and since the father was prepared to purchase the property in his name and give certain undertakings as to the future arrangements, which was acceptable to the court and hence eliminated the need for a trust fund.

24.  Ms Irving submits that in H v S there was no challenge to the court’s jurisdiction to order that a trust fund be set up for the child for provision of accommodation, to which Judge Chu said in para104 of her judgment “I therefore find F’s proposals reasonable and do not see the need of a separate trust being set up for T.” Ms Irving submits that had there been no jurisdiction, the learned judge would have so stated in her judgment.

25.  As for the lump sum order under s 10(2)(a) of GMO, Ms Irving also relies on Judge Chu’s judgment in H v S, following the leading English case on financial provision for children in Re P (Child :Financial Provision) [2003] 2 FLR 865, when she said in para167 that this provision should be “broadly construed whether as backdating or to meet the liabilities or expenses reasonably incurred for maintaining T before the making of the order.”

26.  In Re P an unmarried mother applied for financial provision for a very young child under Schedule 1 to the Children Act 1989 from the father who was an immensely successful businessman who described himself as fabulously wealthy and conceded that he could pay a lump sum of £10 million if ordered to do so. The mother was awarded, inter alia, £450,000 for a house, £30,000 for furnishings and periodical payments of £35,360 per annum to be reduced by £9,333 on the child’s seventh birthday. She was also awarded backdated maintenance of £7,500 for 26 months of shortfall.  On appeal her award was increased to £1 million for the housing fund, £100,000 for internal decoration and £70,000 per annum for periodical payment mainly on the basis of the scale of the father’s fortune and of his chosen way of life.

27.  Mr Coleman for the Father however argues that there is no equivalent provision of a lump sum to meet the child’s housing needs in our GMO as its subsection (2)(a) expressly refers to “the immediate and non-recurring needs of the minor” which does violence to the ordinary language of the statute to suggest that Z in this case has an “immediate need” to the provision of housing by the provision of a lump sum with which to purchase a property.

28.  He submits that it is the plain fact that Z is actually currently housed through the payment of the Father of an amount to include rent for the property in which she and the Mother reside, so that there is no unmet immediate need for that at all, but that even if one were to leave that fact aside, a need for housing is an on-going and recurring need which cannot be described as “immediate and non-recurring” within the plain language of the section.      

29.  He further argues that the Mother’s reference to the English legislation does not assist her case, as was pointed out in by Judge Chu in H v S supra, whilst some guidance can be found in the principles and guidelines set out in the English cases, there are differences in legislation in that the English legislation which provides the power to order a lump sum has no limiting words as are in the Hong Kong legislation, as evidenced by paragraph 2(c) of Schedule 1 of Children Act 1989 referred to above by the Mother, where the English statute permits the English Court to order lump sum for any purpose, while the Hong Kong Court is limited by the terms of the governing statute to ordering lump sums for the specific purposes identified. That difference in statute, he argues, will explain any relevant difference in the approach of the different courts.

30.  As to section 10(2)(e), Mr Coleman submits that the Mother has missed the point of the Father’s argument in that he points to the words “being property to which such parent or either of such parents is soentitled.” On its face, he argues that the section deals only with property to which the relevant parent is entitled. It does not deal with a putative property, which is by definition one to which a parent might become entitled but is not one to which the parent is entitled.

31.  I have no difficulty agreeing with Mr Coleman’s interpretations of both subsections (2)(a) and (2)(e), and I shall start with the plainly more straightforward (2)(e) which in my view clearly and expressly refers to a property to which the parent, in this case the Father, is so entitled, i.e. a property already owned by him that can be properly identified or specified in the pursuant order. It cannot therefore mean, in my judgment, that the court can order the Father in effect to purchase a property either for the benefit of Z or to settle it in her favour as suggested by the Mother. The property to be so ordered must already be owned by the Father or to which he is so entitled, either in possession or reversion, so as to be specified in the order.          

32.  As for the jurisdiction for lump sum provision under subsection (2)(a), it would be relevant to undertake a more detailed examination of Judge Chu’s judgment in H v S supra, where she very helpfully summarised the historical developments of the legal principles on financial provisions for children of unmarried parents at 248D:

“[33] Previously in Hong Kong, the power of the courts to make maintenance orders for children born out of wedlock was provided in the Affiliation Proceedings Ordinance, which was based on the Affiliation Proceedings Act 1957 in England.

[34] In England, over the years, the treatment of children of unmarried has moved towards equality of treatment with children of married parents. In A v A (AMinor: Financial Provision) [1994] 1 FLR 657 at 659, Ward J (as he then was) has set out the history of the powers of the courts in England to make provision for the children of unmarried parents. Initially these were very limited and governed by the Affiliation Proceedings Act 1957. Latter, the criteria for assessing periodical payments were assimilated to those of other children in the Domestic Proceedings and Magistrates Courts Act 1978. But jurisdiction for lump sum provision was limited, and otherwise there were no powers to make capital settlements. These limitations were eventually removed and a wider range of orders was provided for in the Family Law Reform Act 1987, following two Law Commission Reports on illegitimacy. The object of those reports was to remove the differences in the legal positions of children, the underlying principle being that children should not suffer just because their parents had, for whatever reason, not been married to one another (see J vC (Children: Financial Provision) [1999] 1 FLR 152, at p 155).

[35] The Children Act 1989 then came into effect and s.15 of the Children Act enables the court to make financial orders for children, with paragraph 4(1) of Schedule 1 defining the criteria which the court has a duty to have regard to when making such orders. Paragraph 4(1) of Schedule 1 of the Children Act 1989 sets out as follows:

“In deciding whether to exercise its powers under paragraph 1 or 2, and, if so in what manner, the court shall have regard to all the circumstances including –

the income, earning capacity, property and other financial resources which each person mentioned in sub-paragraph 4 [either parent] has or is likely to have in the foreseeable future;

the financial needs, obligations and responsibilities which each [parent] has or is likely to have in the foreseeable future;

the financial needs of the child;

the income, earning capacity (if any), property and other financial resources of the child;

any physical or mental disability of the child;

the manner in which the child was being or was expected to be educated or trained.”          

[36] Paragraph 4(1) is, however, slightly different from s 25(3) of the Matrimonial Causes Act 1973, as set out by Ward J in A v A (A Minor: FinancialProvision), at p. 660, in that:

“(1) Under the Matrimonial Causes Act, the court’s first consideration is for the welfare of the minor child. Whilst welfare is the paramount consideration for the court on any question with respect to the upbringing of the child, upbringing does not include maintenance payments: see the Children Act 1989, s.105.

(2) The standard of living enjoyed by the family is not a fact listed in Schedule 1, no doubt because it is recognised that mother and father may never have lived together as a family.

(3) The physical or mental disabilities of the parent are not expressly in issue under the Children Act though I do not easily understand why that omission is made.”

[37] As to the reason for the omission of the requirement to treat the child’s welfare as the first consideration, Hale J (as she then was) in J v C (Child:Financial provision), had this to say at p. 156:

“The reason for the omission of the requirement to treat the child’s welfare as the first consideration is probably that these provisions apply in cases where the adult parties are, or were, married to one another, and therefore, the court will usually be faced with claims for some provision for the adults as well as for the children. In such cases it makes sense to provide that the children’s welfare should come before that of the adults in determining those claims.

Nevertheless, in cases under the Children Act 1989 the welfare of the child concerned, even if neither the paramount nor the first consideration, must be one of the relevant circumstances to be taken into account when assessing whether and how to order provision.”

[38] Then the Child Support Act 1991 was introduced which applies to “maintenance orders”, meaning the making or securing of orders for periodical payments. Notwithstanding the Child Support Act 1991, the courts in England retain their jurisdiction to make orders for lump sums and transfer and settlement of property for children under section 15 of the Children Act 1989.

[39] Re P (Child: Financial Provision) [2003] 2 FLR 865 is the leading case where the Court of Appeal in England undertook a review of the principles underlying Schedule 1 cases, namely what constituted reasonable provision in Schedule 1 cases …

[42] I will now turn to the position in Hong Kong. The Affiliation Proceedings Ordinance in Hong Kong was repealed in 1997. The power for the courts to make financial orders for children born out of wedlock now appear in s.10(2) of the GMO, which was amended in 1997 to provide a wider range of orders which the court is empowered to make.

[43] S.10(2) of Guardianship of Minors Ordinance (“GMO”) now reads as follows …

[44] Furthermore in 1997, s.12A of GMO was introduced to extend the duration of the financial orders for children to beyond the age of 18 in certain circumstances, in line with the provisions in Matrimonial Proceedings and Property Ordinance (“MPPO”).

[45] In the case of a child of the family in matrimonial proceedings, s.7(2) of MPPO sets out the factors to which this Court shall have regard in exercising its discretion in making financial orders for the child. However, no factors, whether along the lines of s.7(2) of MPPO or paragraph 4(1) of Schedule 1 of the Children Act 1989, have been incorporated into our GMO.

[46] I would further point out that paragraph 1(1) and (2) of the Schedule 1 of the Children Act 1989 are in fact slightly different from our 10(2) of the GMO. Paragraph 1(1) and (2) of the Children Act 1989 read as follows …

[47] The only test set out in s.10(2) of GMO appears to be what the court thinks is reasonable having regard to the means of the parent against whom an order is being sought.

[48] Further, the power to make orders regarding lump sums in Hong Kong appears to be different from that in England. In Hong Kong, the Court only has power is to order a lump sum for the immediate and non-recurring needs of the minor or for the purpose of enabling any liabilities or expenses reasonably incurred in maintaining the minor before the making of the order to be met, or for both under s.10(2)(a0 of GMO. However, under paragraph 1(2)© of Schedule 1 of the Children Act 1989, the court can make an order for ‘such lump sum as may be so specified”. Therefore there is power to order a lump sum generally, in addition to the power in paragraph 5(1) of Schedule 1, which states that an order for a lump sum may be made for the purpose of enabling any liabilities or expenses incurred in connection with the birth of the child or in maintaining the child and reasonably incurred before the making of the order to be met. There also appears to be power for the courts in England to make more than one lump sum (paragraph 1 (5)(a), Schedule 1), which is not the case in Hong Kong.”

33.  There in paragraph 48 the Learned Judge identified the main difference between the English Children Act 1989 and our GMO in terms of the court’s power to make lump sum order in that ours is limited for those purposes stated under s 10(2)(a) only instead of generally, and the fact that she did not find it necessary to deal with the question of her jurisdiction to make lump sum order for housing in that case does not in my view imply, as suggested by Ms Irving, that she would accept that there was jurisdiction for her to do so under s 10(2)(a). I agree with Mr Coleman that a lump sum to purchase a property for a child simply does not come within the ordinary meaning of those stated purposes, as a need for housing cannot be said to be non-recurring but instead an on-going everyday needs.

34.  I also agree with him that the stated purposes, i.e. “for the immediate and non-recurring needs of the minor” should be read together to mean for the purpose of meeting the immediate or urgent needs of the minor on interim basis before the court is in a position to make those other orders under s 10(2)(b) to (e), and that it could not be the intention of the legislation for (2)(a) to cover such long term or recurring needs as housing or accommodation of the minor, which can be more appropriately dealt with under (2)(b) to (e).

35.  Why is it that our legislation has not followed up with those changes in UK which led to their Children Act 1989 as identified by Judge Chu in respect of the court’s powers under GMO to make financial provision for a minor, in particularly for lump sum or sums generally is beyond me, all the more I think unacceptable when the legal disabilities associated with illegitimacy of minor children have since been greatly reduced by the Parent and Child Ordinance, Cap 429, any difference in financial treatments of those children is in my view manifestly unfair and unjust, and clearly has no place in our society.                       

36.  However, until that situation is rectified by legislature, as it now stands I do not believe s 10(2)(a) empowers me to make the kind of lump sum order as suggested by the Mother. Hence her claim for a lump sum to purchase a property for Z under the current section in GMO must fail for lack of jurisdiction.

37.  As for the sole statutory criteria under s 10(2) of GMO for the court to make such financial provision as it thinks reasonable for a minor, it is accepted that some useful guidance can be found on the principles and guidelines set out in Re P supra, upon which Ms Irving for the Mother has placed significant reliance, where Thorpe LJ set out the approach in cases where one or both of the parents ‘lie somewhere on the spectrum from affluent to fabulous rich’ as follows:

“[45] Before coming to the details of the present case I would like to offer my opinion as to the method by which a judge should determine a case similar to this, in that one or both of the parents lie somewhere on the spectrum from affluent to fabulously rich. Such cases may be more likely to be litigated, partly because where the parents are of more modest means financial liabilities will be conclusively settled by the administrative process under the Child Supportive Act 1991, to which the judicial process is only supplementary, and secondly, because the affluent and the very rich may be less deterred by the costs of litigation. The starting point for the judge should be to decide, at least generically, the home that the respondent must provide for the child. The value, the size, and the location of the home all bear upon the reasonable capital cost of furnishing and equipping it as well as upon future income needs, directly in the case of outgoings but also indirectly in the case of external expenditure such as travel, education, and perhaps even holidays. The home will ordinarily be transiently required during the child’s minority or until further order. The appropriate legal mechanism is therefore a settlement of property order. Since the respondent is entitled to the reversion, which in certain circumstances may fall in before the child’s majority, the respondent must have some right to veto on unsuitable investment.

[46] Once that decision has been taken the amount of the lump sum should be easier to judge. For the choice of home introduces some useful boundaries. In most cases the lump sum meets the cost of furnishing and equipping the home and the cost of the family car.

[47] Those issues settled the judge can proceed to determine what budget the mother reasonably requires to fund her expenditure in maintaining the home and its contents and in meeting her other expenditure external to the home, such as school fees, holidays, routine travel expenses, entertainments, presents, etc. In approaching this last decision, the judge is likely to be assailed by rival budgets that specialist family lawyers are adept at producing. Invariably the applicant’s budget hovers somewhere between the generous and the extravagant. Invariably the respondent’s budget expresses parsimony. These arts have been developed in Matrimonial Causes Act 1973 claims, particularly where the budget is advanced to found the calculation of the price of the clean break. But it is worth emphasising the trite point that, by contrast, an order for periodical payments is always variable and will generally have to be revisited to reflect both relevant changes of circumstances and also the factor of inflation. Therefore, in my judgment, the court should discourage undue bickering over budgets. What is required is a broad common-sense assessment. What the court first ordains may have a comparatively brief life before a review is claimed by one or other party.

[48] In making this broad assessment how should the judge approach the mother’s allowance, perhaps the most emotive element in the periodical payments assessment? The respondent will often accept with equanimity elements within the claim that are incapable of benefiting the applicant (for instance school fees or children’s clothing) but payments which the respondent may see as more for the benefit of the applicant than the child are likely to be bitterly resisted. Thus there is an inevitable tension between the two propositions, both correct in law, first that the applicant has no personal entitlement, secondly, that she is entitled to an allowance as the child’s primary carer. Balancing this tension may be difficult in individual cases. In my judgment, the mother’s entitlement to an allowance as the primary carer (an expression which I stress) may be checked but not diminished by the absence of any direct claim in law.

[49] Thus, in my judgment, the court must recognise the responsibility, and often the sacrifice, of the unmarried parent (generally the mother) who is to be the primary carer for the child, perhaps the exclusive carer if the absent parent disassociates from the child. In order to discharge this responsibility the carer must have control of a budget that reflects her position and the position of the father, both social and financial. On the one hand she should not be burdened with unnecessary financial anxiety or have to resort to parsimony when the other parent chooses to live lavishly. On the other hand whatever is provided is there to be spent at the expiration of the year for which it is provided. There can be no slack to enable the recipient to fund a pension or an endowment policy or otherwise to put money away for a rainy day. In some cases it may be appropriate for the court to expect the mother to keep relatively detailed accounts of her outgoings and expenditure in the first and then in succeeding years of receipt. Such evidence would obviously be highly relevant to the determination of any application for either upward or downward variation.”              

38.  Given the Mother’s apparent reliance on the parties’ relationship during their cohabitation in particularly certain promises allegedly made by the Father towards her and her 2 children, and the parties’ dispute over the standard of living to which Z should be entitled to enjoy, it would be useful to also refer to Bodey J’s summary of the considerations in Schedule 1 claims in the same case at paragraph76:

(i)   The welfare of the child while a minor, although not paramount, is naturally a very relevant consideration as one of ‘ … all the circumstances …’ of the case.

(ii) Considerations as to the length and nature of the parents’ relationship and whether or not the child was planned are generally of little if any relevance, since the child’s needs and dependency are the same regardless: J vC (Child: Financial Provision) [1999] 1 FLR 152 at 154B.

(iii) One of the ‘ … financial needs of the child …’ (to which by para 4(1)(c) the court must pay regard) is for him or her to be cared for by a mother who is in a position, both financially and generally, to provide that caring. So it is well established that a child’s need for a carer enables account to be taken of the caring parent’s needs: Haroutunian v Jennings (1980) 1 FLR 62 at 66C; and A vA(A Minor) (Financial Provision) [1994] 1 FLR 657 at 665G.

(iv)  By paras 4(1)(a) and (b) of Sch 1, the respective incomes, earning capacities, property and other financial resources of each of the parents must be taken into account, together with their respective financial needs, obligations and responsibilities. So ‘ … the child is entitled to be brought up in circumstances which bear some sort of relationship with the father’s current resources and the father’s present standard of living …’ – per Hale J in J v C (Child: Financial Provision) [1999] 1 FLR 152.

(v)   However, at this latter concept lends itself to demands going potentially far wider than those reasonably necessary to enable the mother properly to support the child, ‘ … one has to guard against unreasonable claims made on the child’s behalf but with the disguised element of providing for the mother’s benefit rather than for the child …’ – J v C (Child: Financial Provision) [1999] 1 FLR 152.

(vi)  In cases where the father’s resources permit and the mother lacks significant resources of her own, she will generally need suitable accommodation for herself and the child, settled for the duration of the child’s minority with reversion to the father; a capital allowance for setting up the home and for a car; and income provision (with the expense of the child’s education being taken care of, generally, by the father direct with the school).

(vii)  Such income provision is reviewable from time to time, according to the changing circumstances of the parties and of the child.

(viii) The overall result achieved by orders under Sch 1 should be fair, just and reasonable taking into account of all the circumstances.” 

39.  It is with these guidance and principles in mind that I shall now turn to consider the evidence, starting first with what was the standard of living during the parties’ relationship which Z was able to enjoy, and what is the current lifestyle of the Father, as it is such standard against which the Mother argues that her claims for Z should be measured.

Standard of Living

40.  According to the Mother the parties had lived together in an extremely lavish lifestyle with expensive holidays, fancy cars and boats, and luxurious restaurant and shopping, but which she argues that the Father had sought to conceal the extent of this from the court by producing what he said were credit card statements redacted to exclude business expenses or the expenditure of his family members, which she argues as clearly untrue once those statements were finally produced and the Father had been taken through them in his oral evidence that many of the redactions had in fact been expenses for their family that he would have preferred the court not to have had sight of, which were jewellery purchases for her, expensive car hires for them while on holidays in the US, and clothes and holiday expenses for the family, all of which can be seen were of the most lavish standard (CB2: 647).

41.  While she accepts that fashion being the Father’s business and so on any holiday there would be some purchases for his company as samples to copy, the Mother’s evidence is that many of the expenses shown on the credit card were purely personal, and there would be unlimited spending on clothing and jewellery as both were very interested in fashion and wanted to look good and dress well with expensive clothes not only for themselves but also for the 2 girls, and while in Hong Kong they would treat the Grand Hyatt Hotel as their local coffee shop with almost daily expenditure there. She believes that the Father has deliberately camouflaged these spending as part of his business so as to mislead the court of their high standard of living and to defeat her claims for their daughter.

42.  The Father does not dispute that the lifestyle enjoyed by him and the Mother when they were together was indeed to a high standard, but even the Mother’s own review in her evidence in chief of the un-redacted statements was mainly to identify sums spent by the Father on himself or on her or on both which have nothing to do with expenditure on Z, which he says was in fact minimal and not surprising bearing in mind that she was less than 18 months old when the parties separated, and just over 2 years old when these proceedings commenced.

43.  The fact is that, Mr Coleman for the Father argues, travel is and was an important part of his business for buying samples around the world for the business, and that many of the expenses are clearly either entertaining business expenses or for their own pleasure which were completely mixed, and as the Father’s business is fashion, that the Mother had a modelling background, so it was part of their life that they shopped for pleasure which suited the business, but which can have nothing to do with Z, and at her age she could not really have benefited from his restaurants expenses, and mush less on any clothing.

44.  While I accept that there may well be some truth in the criticisms levelled at both parties as to their credibility on their spending pattern, with a tendency to exaggeration on one side and understating it on the other, and while some of the expenses shown in the Father’s un-redacted statements such as travelling, hotels and purchasing samples may indeed be related to his business, there is no question in my mind that the lifestyle enjoyed by them when they were together was to a high standard, as evidenced for instance by their local entertaining and restaurants expenses, while the Father’s personal shopping may indeed not have all been included in the disclosed credit card statements as the Mother has suspected, as those luxurious brands favoured by him referred to in those magazine articles about his high lifestyle (PB1: 168 - 171) do not seem to be well represented in those statements, or if they were, then they may indeed have been for their personal use rather than for his business samples as alleged, which is after all a manufacturer of accessories such as bags, hats, scarves, gloves and belts instead of clothing or shoes, as evidenced by the company’s official profile (Exhibit “R-4”).

45.  It would also be relevant to refer to the Mother’s description in one of her affidavits (PB1: 99) of his apartment at the Convention Plaza where Z had lived during her first 18 months and still lives during her father’s staying access on weekends and holidays, when she said this at para29:

“The Respondent still lives in our former apartment which is located at Flats XXX and YYY, Convention Plaza, 1 harbour Road, Wanchai, Hong Kong. It was 3,400 sq ft with 2 bedrooms, and, at that time, a third room which had been turned into a cinema. A typical wealthy man’s “bachelor pad” rather than a family home. As part of his promises to me and to get me to live with him the Respondent bought the apartment below to create a duplex adding an extra 1,000 sq ft so as to create an extended and large kitchen for our ‘family’. The apartment is ornately decorated with marble floors, mirrors and glass space. It has been featured in Home Magazines and there is now produced and shown to me marked …”

46.  Perhaps a more neutral and certainly much more revealing description of the Father’s apartment and lifestyle can be found in the mentioned magazine article (PB1: 175 – 185) in which he talked about how he loved and enjoyed his high lifestyle, of how he was clearly into having fun, and was about to take delivery of an Aston Martin Vantage Roadster the day after the interview, and so on. It is this standard of living the Mother argues that Z shall be entitled to be brought up in, or to which shall bear some sort of relationship as stated by Hale J in the case of J v C (Child: Financial Provision) [1999] 1 FLR 152, and endorsed by Thorpe LJ in Re P supra, at para40:

“Fourthly, Hale J stated that the child in question was entitled to be brought up in circumstances which bore some sort of relationship to the father’s current resources and the father’s present standard of living. That proposition was preceded by an acknowledgment that the court must guard against unreasonable claims made on the child’s behalf but with the disguised element of providing for the mother’s benefit rather than for the child.”

47.  The parents in that case however had never cohabited or shared a common household, unlike the case in F v G [2005] 1 FLR 261where there had been a period of cohabitation, the standard of living enjoyed by a child is specifically addressed by Singer J as follows:

“[34] In some cases, but not this, the standard of living enjoyed by child (and mother) during lengthy pre-separation cohabitation lasting say, into the child’s early teens could, I suggest, promote the standard of living so long enjoyed by the child to the position of an important, if not the dominant, feature of the case. Here the duration of cohabitation lasted far less long, but during their relationship both before and after the birth of S the parents lived in a way where little expenses was spared and generous indulgence were frequent.

[35] To the extent that this approach may run contrary to the factor isolated by Bodey J at para [76] of his judgment in Re P (Child: Financial Provision) [2003] EWCA Civ 837, [2003] 2 WLR 865, [2003] 2 FLR 865 (that ‘consideration as to the length and nature of the parents’ relationship and whether or not the child was planned are generally of little if any relevance, since the child’s needs and dependency are the same regardless’) I suggest that the justification may be that the extent to which the unit of primary carer and child have become accustomed to a particular level of lifestyle can impact legitimately on an evaluation of the child’s needs, reasonably to be viewed against his or her history.

[36] The factual matrix of Re P (Child:Financial Provision) was that those parents had never shared a common household, nor cohabitated: see para [27]. No question of shared living standards accordingly arose in that case, where the disparity of the means individually available to the parents was even starker than here. This father cannot be described as ‘fabulously wealthy’. But nothing which I discern from reading that authority suggests to me that, in an appropriate case, it must as a matter of law be irrelevant that the parents lived to a standard which is now beyond attainment by the child who is the object of the maintenance/accommodation fund unless that standard is to some extent to be reflected in the measure of the relief awarded. On the contrary, this proposition chimes well with the concentration, which Thorpe LJ at paras [38] and [44] approved, upon the child’s welfare (not expressly referred to in para 4(1) of Sch 1 either). He indeed amplified the passage to that effect from the decision of Hale J (as she then was) in J v C (Child:Financial Provision) [1999] 1 FLR 152, stressing that :

‘welfare must not be just “one of the relevant circumstances” but, in the generality of cases, be a constant influence on the discretionary outcome. I say that because the purpose of the statutory exercise is to ensure for the child of parents who have never married and who have become alienated and combative, support and also protection against adult irresponsibility and selfishness, at least insofar as money and property can achieve those ends.’

[37] At paras [40] and [41] Thorpe LJ also endorsed the following proposition, summarised from the judgment in J v C (Child: Financial Provision) of Hale J, which he formulated thus :

‘ … the child in question was entitled to be brought up in circumstances which bare some sort of relationship to the father’s current resources and the father’s present standard of living. That proposition was preceded by an acknowledgment that the court must guard against unreasonable claims made on the child’s behalf but with the disguised element of providing for the mother’s benefit rather than for the child.’

[38] I am, therefore, anxious that my award should, to an extent which I regard as reasonable in all the circumstances of the case, mitigate the disparity which inevitably will remain between the father’s spending power and that of the household where S will grow up. I can do that by adopting a level of award which should enable the mother to provide S with a fabric of home life not too brutally remote from that which the father’s hard work enable him to sustain.”  

48.  I agree with both views expressed above, which are essentially similar, and propose to adopt a level of award which should allow the Mother to provide Z with a home life not too remote from what she used to be able to enjoy with her parents when they were living together, and what her father is currently enjoying, not just by himself but also by her when she stays with him at his home during his weekly and holidays access.      

49.  I shall next consider the issue over the position of N in relation to the Mother’s claim for her carer’s allowance.

The Position Regarding N

50.  While the Mother accepts that she has no claim against the Father for direct payment for N, she argues that in reality N is Z’s sister and lives and grows up with her together in the same family and household, and it would be absurd if one takes to the view that N is not to benefit from what is provided for Z, and in terms of provision for housing, N’s existence as Z’s sister cannot be ignored, as it is in Z’s interests that she and her half-sister can grow up together.

51.  This point was addressed by Hale J in J v C supra at p 160E :

“The other point made on behalf of the father is that he is not responsible for T’s two half-sisters. Of course I accept that. However, T does need to live with them. In practical terms she needs to live with her mother and her mother has to provide for them and so I have to take that into account. In human terms she needs to grow up with her sisters. It would clearly be greatly to her benefit for her to do so. In taking that view I draw some support from A v A where there were two other children who were not the responsibility of the father. Ward J held that this was immaterial because their needs did not greatly affect the cost of keeping a roof over the head of the relevant child and her carer.

It is not quite as simple as that in this case because the mother wants to obtain a four-bedroomed house so that the girls can each have their own bedroom and its associated privacy as they grow up. She would also like to have two rooms downstairs so that they can get away from one another. She points out that the age gap means that T’s potential for interfering with, aggravating and annoying her sisters is considerable. She also points out that T is a poor sleeper who tends to wake up in the night and also is not yet ‘dry’ at night and, therefore, there may be wet beds and other things that need attention.

For those reasons it would be quite reasonable to expect Y to have her own bedroom and it would be wrong, from her point of view, to treat her so much more favourably than the other children in the household. I think, therefore, that it is quite a reasonable requirement for T to live in a four-bedroomed house. I do not mean a luxurious four-bedroom house; I mean a four-bedroomed house where there are small bedrooms of the sort detailed in some of the agents’ particulars which the mother has produced.

For all of these reasons, I consider, in principle, that the father should be making provision of the sort for which the mother is asking and the only question is how much that should be.”

52.  Other than indirectly in terms of accommodation, Hale J did not, and obviously could not, order the father in that case to make any financial provision for T’s half-sisters to whom he had no responsibility. In her present proposal, the Mother appears to be asking the court to take into account of a monthly need of HK$30,000 for her to provide for N to include clothes, travel and extra-curricular activities with Z when assessing the carer’s allowance, as the Mother’s needs as a carer for Z inextricably includes the expenses she bears for her half-sister.

53.  The Father does not dispute when it comes to accommodation, the court will take into account of the fact that the Mother has another child, N, even though he is not her father, but it also needs to take account of the fact that there is someone in addition to the Mother who is legally responsible for the maintenance of N, namely her own father, Mr W who is said to have come from a wealthy, prominent family in Bangkok and that himself a prominent film director, and that contrary to the Mother’s evidence, Mr W had indeed made financial provisions for N including her school fees and cash payments to the Mother for her maintenance, as evidenced respectively by his e-mails (PB7: 2582) and the surveillance report produced by the Father (PB6: 1886).

54.  Importantly, Mr Coleman argues that on the evidence before it, the court should accept that N’s father not only has a legal obligation to support his daughter, but that he has at least to some extent done so, and will continue to do so in future, as he has made the point in his statements, and especially when he is enjoying access with N, which makes more likely he will honour his financial obligations to her too.

55.  Furthermore, he submits, these statements could obviously be used by the Mother in any court proceedings she felt necessary to ensure that proper support is provided for N by her father. There is therefore no proper basis, in the relevant jurisdiction, as a matter of law or on the facts, for the Mother to seek to increase the maintenance for Z, whether through a carer’s allowance, or howsoever to include any expenses for N.

56.  On the evidence before the court, while I accept the reality of Z living and growing up with N as her half-sister in her mother’s household cannot be ignored, I agree with the Father that there is no reason or basis, at least under the circumstances, to take into account of N’s needs and expenses when deciding on the Mother’s claim for carer’s allowance, at least not in the current situation with N, who is after all some 5 years older than Z with her own different needs which are the responsibility of her own parents.         

Accommodation

57.  As noted above there is the issue as to whether the boyfriend of the Mother has been cohabiting with her in her current apartment whom the Father argues should be responsible for at least 1/3 share of the rental and utilities. The Mother denies cohabitation but accept her boyfriend did stay over at her place on occasions, but that in any event they have since broken off their relationship. Upon hearing the evidence of both the Mother and the boyfriend, I accept that whatever the case with their living arrangement in the past, given that their relationship has now ended, so is no longer the issue over the boyfriend’s contribution as far as the Mother’s present claim for accommodation expenses for Z is concerned.       

58.  The reality that Z is going to live and grow up with N mentioned above is certainly one of the matters the court will have to take into account in determining what sort of housing or accommodation which will be reasonable for Z, but given my view that the court has no power to make a lump sum order for the purchase of accommodation under s 10(2)(a) of GMO, nor is there any claim by the Mother for an order for the transfer or settlement of any of the Convention Plaza Apartments in which the Father is interested for the reason she has given, the short point here is that she and Z as well as N will for the time being continue to reside in her present apartment in Bel-Air at the current rent of HK$76,000 per month but for which the Father is willing to contribute what he thinks reasonable at only HK$50,000 per month.

59.  To be fair to him, the Father has stated that he would be willing to consider the purchase of a property for the benefit of Z and to allow the Mother and Z to reside in that property, but there is the issue of timing and suitability of the property purchased, and that as it would remain as his asset and would revert to him completely, it is not inappropriate for him to wish to decide the ‘investment’ timing. Accordingly the question for me now must be whether the current apartment is a reasonable accommodation for Z in the circumstances of the case.

60.  On this issue the Father believes that the Mother moved out of the Convention Plaza apartment without conferring with him or giving advance notice to a substantially larger 3-bedroom apartment at Bel-Air, at exactly the same time when she commenced these proceedings, was plainly trying to present the court with a fait accompli and to reset the rental benchmark against which she hoped her application would fall to be judged, which action he argues should not be condoned or to be rewarded. The Mother of course denied it, claiming that the Father had intended to move them to a bigger flat at the Convention Plaza after decoration, but she just did not want to live as his neighbour.

61.  He further argues, if the Mother wants to stay within the Pokfulam region, there are 3-bedroom apartments at Bel-Air or Baguio Villa at rents around HK$50,000 or just above (Exhibit “R-3”), hence in his opinion the rent for her current apartment at HK$76,000 is excessive and unreasonable.

62.  All three types of apartments shown in “R – 3” were of the size of 1,469 sq ft with 3 bedrooms in Bel-Air asking for rental between HK$47,000 and HK$50,000 per month. This is the type of apartments that the Father says is suitable and reasonable for Z and her mother. The Mother on the other hand argues that that size of 1,469 sq ft in fact gives only just over 1,000 sq ft in usable area according to her Exhibit A – 3 and is too small for her household of 4 including N and the helper.

63.  The kind of housing the Mother prefers is in Exhibit A – 4, also in Bel-Airs with 3 bedrooms but of somewhat bigger size about 1,800 sq ft. There is however no indication of rental amount but it is believed that they would be about the range of her current flat, hence a difference of some HK$26,000 per month between the parties.

64.  Compared with the Father’s residence, the Mother’s current or proposed apartment is less than half in size, no doubt much less lavishly decorated or furnished, and certainly nowhere near as high standard, but should in my view bear some sort of relationship thereto or provide Z with some fabric of home life not too remote from that which her father is enjoying, and given his means I do not find the rental requirement for the Mother’s present apartment excessive or unreasonable in the circumstances. It is certainly something he can well afford. I shall next turn to consider her claim for the general expenses of such household.

General Household Expenses

65.  As noted above the Father takes issue with the quantum of most of the items of the general household expenses of HK$85,250 put forward by the Mother as highly inflated or exaggerated, and mostly unsupported by documentary evidence.

66.  Of the biggest item of these expenses, HK$25,000 for food, Mr Coleman submits that the Mother’s basis for this amount was gauged from her conversations with the Father during their relationship and that that was how they lived, of which he argues as simply guesswork, and that it was at best a very rough figure relating to a different time when the parties were together. The real issue, he argues, is the maintenance required for Z’s current lifestyle and not the parties’ previous and historical lifestyle. In the absence of receipts to the contrary, he submits that the food expenses for a small child like Z cannot be great, and that the Father’s proposal of HK$4,000 for her food expenses is only fair and reasonable.

67.  As referred to above, the standard of living during the parties’ relationship and the Father’s current lifestyle are clearly relevant to what would be the reasonable needs of Z including her food expenses, but whatever the total amount of the parties’ food expenses in the past, I am dealing only with Z’s share, and even on the basis of the Mother’s figure for the entire family at the time of cohabitation and no doubt included the costs for adult food such as wine and drinks, I find it excessively high and I agree with the Father that a sum of HK$4,000 would seem a reasonable sum for a child of 3 ½ years, in particularly of the fact that her lunch during school days are already included in her school fees paid for directly by her father.

68.  As for the utilities of HK$5,000 and household expenses of HK$10,000, I believe that the Father has no real issue with the former, but the latter does seem to me again on the high side in the absence of document support. Taking a broad brush approach I would allocate a sum of HK$2,000 for Z’s share. I also agree with the Father’s proposed sum of HK$5,800 for the domestic helper subject to production of contract as more appropriate, that he will be directly responsible for Z’s insurance payment, and for her mobile phone expenses when she is old enough to need one. This leaves the items of HK$14,000 for car and HK$20,000 for Mandarin Governess as the remaining major issues in this category, of which I believe should be more suitably dealt with below under Z’s personal expenses.

Personal Expenses of Z

69.  Of the personal expenses of Z put forward by the Mother at HK$13,884 per month in total, excluding for the time being the 2 items mentioned above, being essentially HK$4,000 for clothing/shoes, HK$5,000 for entertainment/presents, and HK$4,584 for holidays at HK$55,000 per year including air fares and hotel, while all her school expenses, extra tuition and curricular activities, school bus and insurance amounting to more than HK$20,000 per month now being paid for by the Father directly, she suggests that he should continue to do so.

70.  While the Father agrees to continue with his direct payment of all of Z’s school and education expenses, he finds some of the other personal expenses such as clothing, entertainment and holidays too high for her age, and proposes a somewhat lower amount of HK$3,000 for clothing and toys, and HK$2,000 for restaurant and entertainment, plus 2 economy class round-trip tickets per year for holiday and HK$800 per day for her daily expenses limited to 2 weeks per trip.

71.  The main dispute the Father has over Z’s expenses is in fact whether she needs a full-time Mandarin governess at HK$20,000 per month claimed by the Mother. She says that it was by agreement with the Father during their relationship that the children would need this support to keep up at their schools, and that the governess would be there after school from 2:30 pm to 9:30 pm and all day on weekends and holiday talking to the children in Mandarin and assisting them with their studies, as the Mother herself does not speak Mandarin, hence it is otherwise impossible for the children to maintain this at home.

72.  The Father has offered to pay a reasonable cost for Mandarin lessons for Z, but argues that there is no reasonable basis to require a full-time Mandarin governess, nor is there any justification for such an employee in addition to a domestic helper while the Mother says that she is a full-time mother, and that it seems to him another attempt to benefit N when, if she requires Mandarin lessons, they would fall to be paid by her father.

73.  It seems a valid point to me in the Father’s argument that the Mother requires the Mandarin Governess not just to tutor Z but also N, which is perhaps the reason why she had put this item amongst her general expenses rather than Z’s personal expenses, which if true is of course again not the Father’s legal responsibility as far as N is concerned, but even for Z, the question must be whether it is reasonable or necessary for her to learn Mandarin in the manner proposed by the Mother?

74.  On her own admission the Mother does not speak Mandarin, and while it is not clear whether the Father does, his mother tongue is clearly English, and while both believes it is in Z’s interests to learn Mandarin and for her to receive additional tuition so as to keep up at school, it seems to me unjustified to have a Mandarin tutor for her everyday after school from 2:30 pm to 9:30 pm and on the whole of weekends and holidays under the circumstances and at her present age. After all, it is a language still very much less commonly spoken in Hong Kong, and probably none at all in either household of the parties. It also looks suspiciously a case to me that the Mother in fact needs the Mandarin Governess on weekends and holidays to help her to look after the children when her domestic helper would be on her day off. Accordingly I agree with the Father that Z does not require a full-time Mandarin Governess at HK$20,000 per month, but instead just normal private lessons the charges for which he would be responsible.

75.  As to the remaining issue over transportation for Z, the Mother asks for a sum to purchase a car, suggesting HK$500,000 for a Mercedes given the type of cars driven by the Father, and HK$14,000 per month for its maintenance, gas and repairs as well as for taxi fares on the occasions when she is not driving.

76.  The Father does not believe that there is any necessity at this stage to provide a car for Z, that it is at best premature which may be addressed in a few years time, in particularly when the Mother herself has not driven for years, nor does she have experience driving in Hong Kong, as she does not even have a driving licence here. He does accept that there will be some incidental taxi expenses, but insists that the Mother’s proposed figure is plainly vastly exaggerated.

77.  It appears to me that at the present stage and in the circumstances referred to above there is indeed no necessity to purchase a car for transporting Z when most of her weekdays transportation will have already been taken care of by her father paying for her school bus fares, while for weekends and holidays when realistically she will be spending part thereof with the Father. It is simply not justified or practical to me to purchase a car for her at this stage, let alone spending HK$500,000 for it. The Father’s proposal of HK$1,000 for her taxi fares mainly for her extra-curricular activities and on those weekends when she would be with her mother seems to me a reasonable sum under the circumstances.                                         

78.  Otherwise it seems to me that the difference between the respective proposal for Z’s other expenses is in reality not substantial, as clearly the Father has always totted Z and would no doubt be willing to be flexible and generous on her personal expenses such as clothing and presents when she stays with him during his access, hence I would allocate the sum of HK$13,000 to cover her expenses while under her mother’s care including her food, her share of the household expenses, local travel, clothing/shoes, toys, gifts and presents, and restaurant meals. I shall next turn to one remaining claim of the Mother that the Father says has given rise to the ‘tension’ anticipated in the authorities, her carer’s allowance.

Carer’s Allowance

79.  Having been a model previously, the Mother says that the decision taken by her and the Father to have Z together means that she can no longer return to modelling, as she has been out of the industry for years, is older and no longer has the connections she used to have, plus the fact that she has no work visa in Hong Kong and so even if offered work, she could not do so here, and with 2 young daughters, she says she cannot go overseas to take jobs elsewhere save for perhaps in nearby Macau, where she agrees she had done some work earlier.

80.  It appears to be accepted that she has no earning capacity, as there is no evidence that she is qualified for any other employment, and hence she finds the Father’s proposal that she receives HK$10,000 per month as a carer’s allowance insulting and simply impossible to meet either her general monthly household expenses of HK$85,250, or her personal expenses in excess of HK$75,500.

81.  The Mother justifies such spending as normal and reasonable by arguing that her Amex credit card spending as disclosed during the relationship supports her case that she was not restricted in her spending, as a schedule drawn up and produced as Exhibit A-2 shows an average spending on that card of almost HK$45,000 per month from January 2010 to May 2011 when the card was cut off, while there was always cash available which she says was kept in the safe of the Father’s apartment, and that other expenses such as household, transport/car, education and extracurricular activities, holidays and dining out were all paid by the Father as evidenced by his own credit card statements, which are in line with the schedule of expenses produced by her on PB8: 2916 and with the standard they had during their relationship.    

82.  Ms Irving further submits that this is such a case where both parties by their conduct during their relationship, the Mother’s continuing commitment to Z and the standard of living enjoyed during the relationship and by the Father still, that a generous allowance should be made for the Mother, as the authorities direct that a carer’s allowance reflect the commitment, responsibility and sacrifice of the Mother as carer, as it was said in Re P supra, at para49 that ‘(the carer) should not beburdened with unnecessary financial anxiety or have to resort toparsimony when the other parent chooses to live stylishly’.

83.  Mr Coleman however argues that the Mother’s claim to personal spending reads like an ancillary relief claim in a divorce case, with items such as clothing/shoes and personal grooming were admitted by her just on the historical basis when she was in the boyfriend/girlfriend relationship with the Father which he argues is not a proper basis for such a claim, but rather should be reached on a more analytically correct basis, and certainly cannot possibly be anything as high as is claimed.

84.  The evidence before the court is that the Mother used to earn between HK$20,000 - $30,000 per month before she gave birth to Z. While she is certainly not entitled in law to claim her carer’s allowance on the same basis of a wife for ancillary relief, it would not be inappropriate in my view instead to use her former average income as the basis for assessing her allowance as the primary carer, which as Thorpe LJ said in Re P above, and using his words here, may be checked but not diminished by the absence of any direct claim in law, and that in order to discharge this responsibility as the primary carer of Z, she must have a budget that reflects her position and the position of the Father both social and financial, as she should not be burdened with unnecessary financial anxiety or have to resort to parsimony when the Father chooses to live lavishly.

85.  In the circumstances the Father’s proposed HK$10,000 is in my view wholly inadequate and inappropriate, but at HK$25,000 I do not see why the Mother would not be able to budget her general household expenses as well as her own needs at a more realistic and workable level, certainly not at the standard as before or of the Father, but not brutally remote therefrom either.      

Conclusion

86.  As Bodey J has stressed in Re P supra, no mathematical formula can provide a solution to what is essentially a discretionary exercise to be adopted broadly, and no doubt with common sense on the part of the judge. Accordingly, for all the reasons given above, and adopting a broad commonsense assessment and having regards to the means and lifestyle of the Father, and using the words of Singer J in F v G supra, I believe the following monthly sums will enable the Mother to provide for Z with some fabric of home life not too remote from what the Father has been able to enjoy, and is reasonable in the circumstances of the case:

(a) Rent and Utilities :	HK$80,000
(b) Maintenance for Z :	HK$13,000
(c) Mother’s Carer Allowance :	HK$25,000
Total :	HK$118,000

87.  This is on the basis that the Father shall continue to be directly responsible for Z’s school fees, school bus charges, current ballet and music classes, medical insurance, reasonable costs of additional extra-curricular activities such as piano, arts and crafts, and Mandarin lessons, as well as provision for holidays including 2 economy class round-trip tickets and daily expenses and others as set out in his open proposal. I would also allow the Mother’s request for the maintenance to be dated back to the date of her application and to be set off against payments already made by the Father.   

88.  As for the question of costs, given my understanding that further negotiation between the parties had taken place since the trial, I shall reserve it so that a hearing can be fixed to hear argument. Last but not least, it remains my wish to express my gratitude to both counsel for their valuable assistance rendered to the court.

Ms Frances Irving instructed by M/S Oldham, Li & Nie for the Applicant.

Mr Russell Coleman SC instructed by M/S Mayer Brown JSM for the Respondent.