Divorce — ancillary relief — approach to financial assistance provided by third parties in assessment of parties’ financial resources — term “judicious encouragement” should no longer be used
In 2000, H and his wife (“W”) married when they were in their twenties. H was well qualified with an Executive MBA degree from one of the world’s most prestigious business schools, as financed by his parents. In 2002, W fell seriously ill and was unable to work; consequently, H did not work for most of the marriage to care for her. His parents, who were well-off and from a well-known family, provided the couple with a reasonably high standard of living. In 2006, H and W separated and in 2008, H petitioned for divorce. In 2009, H began employment earning HK$14,000 per month, which would increase relatively significantly. He lived with his parents, who continued to support him financially including paying his credit card bills, club memberships and medical expenses. W, however, remained unable to lead a normal life and after the separation was completely dependent on her parents; by mid-2010, her expenses had amounted to over HK$2.4 million.
The Court of Appeal (the “CA”) ordered H to make to W: (a) periodical payments of HK$42,500 per month until the death of either party or the remarriage of W, whichever was earlier, or until further order; and (b) a lump sum payment of HK$1.5 million.
Held, dismissing H’s appeal, that, inter alia:
Assessing the financial resources of parties to a marriage when considering an application for ancillary relief included taking into consideration financial assistance made by third parties. In every case where this was involved, the two critical evidential questions for the court were: (a) the extent of the financial assistance provided by the third party to the husband or wife; and (b) the likelihood of such assistance continuing in the foreseeable future. The court had to look at the reality of the situation and have regard to matters of substance and not just form.
The concept of “judicious encouragement”, which might be taken to mean that the court could encourage third parties to provide financial assistance, had led to confusion among judges and practitioners, and the term should no longer be used. This is because it might be manifested in a form of pressure on non-parties to add to the relevant spouse’s resources which, on the evidence they would not do or were unlikely to do.