AJR v AJS

• Jurisdiction: Singapore
• Judge: Chan Seng Onn J
• Judgment Date: 15 July 2010
• Neutral Citation: [2010] SGHC 199
• Plaintiff Counsel: Ragbir Singh s/o Ram Singh Bajwa (Bajwa & Co)
• Docket Number: Divorce Transferred No 4402 of 2006
• Date: 15 July 2010
• Hearing Date: 26 May 2010,12 February 2010
• Subject Matter: Family law
• Year: 2010
• Citation: [2010] SGHC 199
• Defendant Counsel: Dr Anamah Tan (Ann Tan & Associates)
• Court: High Court (Singapore)
• Published date: 15 July 2010

Chan Seng Onn J:

The parties were married on 26th August 1995 in Guam. They have three children, aged 7, 10 and 11 years. The wife filed for divorce on 4 October 2006 and the husband moved out of the matrimonial home in January 2007. Interim judgment was granted on 16 March 2007 with a consent order as to the joint custody of the children with care and control to the wife and liberal access to the husband (“the Interim Judgment”). The issues before me concern: (a) the manner in which the matrimonial assets are to be distributed; and (b) the amount to be paid as maintenance for the three children of the marriage.

Distribution of matrimonial assets The matrimonial assets

A preliminary issue is the question of the date at which the matrimonial assets and the parties’ contributions thereto are to be considered for distribution, ie, whether the matrimonial assets in the present case encompass assets existing (a) as at the date of the Interim Judgment (16 March 2007); or (b) as at the date of the ancillary orders for division of the matrimonial assets.

Between the date of the Interim Judgment and the present date, there has been a change both in the value and in the nature of the assets through the acquisition of new assets after the date of the Interim Judgment. The value of the assets has increased due to the accumulation of both parties’ salaries earned after the date of the Interim Judgment. More importantly, after the date of the Interim Judgment, the wife purchased three properties in Malaysia for investment purposes (“the Malaysian properties”) and bought a piece of land in Singapore on which to build a house (“the Singapore property”). In 2008 and 2009, she also exercised some stock options which she had acquired before the date of the Interim Judgment. In addition, some of the proceeds from the sale of a property in South Africa (“the South African Property”) which property had been acquired in the wife’s name before the date of the Interim Judgment, appear to have only been transferred to the wife’s bank account in Singapore in 2008.

In my opinion, apart from assets acquired before the marriage which satisfy the definition of “matrimonial assets” in s 112(10)(a) of the Women’s Charter (Cap 353, 2009 Rev Ed), the matrimonial assets available for distribution should be restricted to the assets acquired in the course of the marriage by both parties up to the date of the Interim Judgment. Hence, all the matrimonial assets (including any valuable accrued rights such as stock options and future bonuses arising from employment prior to the date of interim judgment) which existed as at the date of the Interim Judgment are the relevant assets for distribution. Any asset acquired after the date of the Interim Judgment should not be considered a matrimonial asset to be distributed between the parties. The party choosing to invest in new assets after the date of the Interim Judgment takes the benefit of an appreciation and also the market risk of a fall in the value of those investments. The rationale behind this is that the Interim Judgment puts an end to the marriage contract and indicates that the parties no longer intend to participate in the joint accumulation of matrimonial assets nor in any further joint investment in any matrimonial assets with the associated market risk of a fall in the value of those joint investments, unless there is evidence to substantiate a mutual intention to the contrary. As the Court of Appeal observed in Sivakolunthu Kumarasamy v Shanmugam Nagaiah and another [1987] SLR(R) 702 (“Sivakolunthu”) (at [25]):

The grant of a decree nisi is a recognition by the “court that the marriage is at an end”. When such a decree is pronounced, there is, as Lord Wright said [in Fender v St John-Mildmay [1938] AC 1 at 45-6], no longer any matrimonial home, no consortium vitae and no right on either side to conjugal rights.

In Sivakolunthu, the Court of Appeal held that the jurisdiction to make ancillary orders is founded on the reality of the break-up of a marriage rather than the legal formality of such a break-up and that this is also evidenced by the power of the court to order a division of matrimonial assets upon the granting of a decree of judicial separation Consequently, the Court of Appeal construed the expression “decree of divorce” in the then s 106(1) of the Women’s Charter (Cap 353, 1985 Ed) to include a decree nisi Section 106(1) of the Women’s Charter was subsequently replaced by s 112(1) of the Women’s Charter (Cap 353, 1997 Rev Ed) Nevertheless, as observed by Kan Ting Chiu J in Yap Hwee May Kathryn v Geh Thien Ee Martin and another [[2007] 3 SLR(R) 663 (“Yap Hwee May Kathryn”), there are strong similarities in s106 of the Women’s Charter (Cap 353, 1985 Ed) and s 112 of the Women’s Charter (Cap 353, 1997 Rev Ed) in that they both set out the power of the court to order the division of matrimonial assets. Section 106(1) of the Women’s Charter (Cap 353, 1985 Rev Ed) stated that the court shall have the power “when granting a decree of divorce” while s 112(1) of the Women’s Charter (Cap 353, 1997 Rev Ed) stated that the court shall have the power “when granting or subsequent to the grant of a decree of divorce” [emphasis added]. Kan J held that the Court of Appeal’s ruling in Sivakolunthu that “decree of divorce” includes a decree nisi should apply to s 112(1) of the Women’s Charter (Cap 353, 1997 Rev Ed) as well. Section 112(1) of the WWomen’s Charter (Cap 353, 2009 Rev Ed) now states that the court shall have the power to order the division of matrimonial assets “when granting or subsequent to the grant of a judgment of divorce” [emphasis added]. Reasoning by analogy, s 112(1) of the Women’s Charter (Cap 353 2009 Rev Ed) should also be interpreted such that the court shall have the power to order the division of matrimonial assets when granting or subsequent to the grant of an interim judgment.

The reasoning in Sivakolunthu was applied by the High Court in Yap Hwee May Kathryn where Kan J stated his preference for the date when the decree nisi was made as the operative date for an order for the division of matrimonial assets. Kan J cited two persuasive reasons for his preference. Firstly, if all the relevant facts are before the court, there is no reason why the actual division of matrimonial assets should not be done when the decree nisi is granted. Secondly, it is impossible to employ the date of the decree absolute as the operative date for division as the date cannot be ascertained when the division is made since a decree absolute is only made when the hearing of all ancillary matters, such as the division of matrimonial assets and custody, are concluded. I agree. I would also add that it would be inconsistent with the intention of the parties to include in the pool of matrimonial assets any assets that they separately acquire after the grant of the interim judgment since, as at the date of the interim judgment, the parties have already “put an end to the whole content of the marriage contract, leaving only the shell, that is, the technical bond” ( Fender v St John-Mildmay [1936] 1 KB 111, per Greer LJ at 115-7). As such, on the facts of the present case, given the clear intention of the parties not to contribute to the pool of matrimonial assets as from the date of Interim Judgment, I would consider the matrimonial assets available for distribution to be the assets existing at the date of Interim Judgment. However, I would stress that the date of the Interim Judgment only determines the assets which are available for distribution and not the value of such assets which would be taken into account when dividing the matrimonial assets. I will elaborate at [8] and [9] below on how the net asset values for the purpose of division are to be determined. Any other outstanding liabilities incurred for the welfare of the family (eg, outstanding loans taken to finance the children’s education, family holidays or family expenses during the marriage) would also have to be deducted in order to derive the total net value of matrimonial assets available for distribution, which shall hereinafter be referred to as “S$m”.

In some rare cases, a party may have indulged in certain vices involving a large amount of expenditure (eg, excessive gambling or drinking) to the extent that matrimonial assets have been unfairly or unjustly depleted by the unacceptable actions of that party. Should the innocent party to the marriage be made to suffer on account of that or should the guilty party be made to bear the entire amount of that expenditure or at least a part thereof, as if that guilty party had spent his own share of the matrimonial assets when calculating the distribution of matrimonial assets? In my view, the court has a discretion to decide whether or not such a wasteful dissipation of matrimonial assets should be accounted for at all, and if so, the extent to which that wasteful dissipation should be accounted for in order to make the eventual distribution of matrimonial assets just and equitable for the innocent party. Should the court decide that it is just and equitable for the entire amount dissipated to be accounted for as part of the matrimonial assets as if the entire amount had not been dissipated, then the entire amount proved to have been unfairly or unjustly dissipated by that party during the course of the marriage until the date of interim judgment will be notionally added to the total net amount of the matrimonial assets. If the court decides that it is only just and equitable to account for a fraction of the entire amount dissipated by the guilty party, especially where there was no vehement objection from the innocent party at the time the expenditure on the vices were incurred by the guilty party, then only that fraction will be added to the total net amount of the matrimonial assets. The amount notionally...