Tan Hwee Lee v Tan Cheng Guan

JurisdictionSingapore
Judgment Date30 August 2012
Date30 August 2012
Docket NumberCivil Appeals Nos 135 and 136 of 2011 and Summons No 266 of 2012
CourtCourt of Appeal (Singapore)
Tan Hwee Lee
Plaintiff
and
Tan Cheng Guan and another appeal and another matter
Defendant

Chao Hick Tin JA, Andrew Phang Boon Leong JA and V K Rajah JA

Civil Appeals Nos 135 and 136 of 2011 and Summons No 266 of 2012

Court of Appeal

Civil Procedure—Appeals—Application to adduce fresh evidence on appeal—Wife's counsel seeking to adduce further evidence on appeal—Whether further evidence could be obtained with reasonable diligence earlier—Order 57 r 13 (2) Rules of Court (Cap 322, R 5, 2006 Rev Ed)

Family Law—Maintenance—Wife—Wife claiming multiplicand of maintenance order too low—Husband claiming lump sum maintenance should be discounted—Whether maintenance order was appropriate in the circumstances—Sections 114 (2) and 115 (1) Women's Charter (Cap 353, 2009 Rev Ed)

Family Law—Matrimonial assets—Division—Husband claiming that loan liability of property not properly taken into consideration—Husband claiming that past Central Provident Fund contributions towards property should be included when valuing property—Husband claiming that outstanding loan of property which no longer belonged to him need not be serviced by him—Whether property was correctly valued for purposes of division—Whether Husband should serve outstanding loan of property that no longer belonged to him

Family Law—Matrimonial assets—Division—Husband claiming that Wife should not receive half of overall matrimonial assets—Whether division of matrimonial assets on a 50:50 basis was just and equitable—Section 112 (1) Women's Charter (Cap 353, 2009 Rev Ed)

Family Law—Matrimonial assets—Gifts—Wife claiming that property gifted to her by Husband prior to divorce not matrimonial asset—Whether inter-spousal gifts were matrimonial assets—Section 112 (10) Women's Charter (Cap 353, 2009 Rev Ed)

Statutory Interpretation—Definitions—Whether word ‘gift’ in s 112 (10) Women's Charter (Cap 353, 2009 Rev Ed) referred to inter-spousal gifts or only third-party gifts—Section 112 (10) Women's Charter (Cap 353, 2009 Rev Ed)

Words and Phrases—Wife claiming that allowing gifted property to be included for division as matrimonial asset inequitable—Meaning of ‘inequity’ when dealing with inter-spousal gifts—Sections 112 (1) and 112 (2) (e) Women's Charter (Cap 353, 2009 Rev Ed)

Tan Cheng Guan (‘the Husband’) and Tan Hwee Lee (‘the Wife’) were married on 9 October 1982 and have two daughters, respectively aged 23 and 21 years (collectively referred to as ‘the Children’). During the 28-year marriage, the Husband was the sole breadwinner while the Wife looked after the household and the Children. Throughout their marriage, the Husband and the Wife (‘the parties’) owned three properties: (a)32 Seletar Hills Drive Singapore 807047 (‘32 SHD’); (b)34 Seletar Hills Drive Singapore 807049 (‘34 SHD’) and (c)36 E La Salle Street Singapore 454936 (‘the La Salle Property’). The parties' relationship deteriorated through the years and, in 1999, they entered into a deed of separation. Between late 2006 and early 2007, the Husband agreed to sever the joint tenancy in 32 SHD and gave 40% of 32 SHD from his share to the Wife with the result that she held 90% of that property. In May 2007, the Husband also executed a formal deed (‘the 2007 Deed’) to provide financially for the Wife and the Children.

In April 2008, the Husband commenced divorce proceedings and a decree nisi was granted on 6 May 2010. Before the High Court judge (‘the Judge’), the parties' claims on the share of the matrimonial assets each spouse should receive upon divorce were widely divergent.

The Judge first laid out a three-stage methodological framework for dividing matrimonial assets: first, the pooling of the assets and the ascertainment of the value of the pool (‘the first stage’); second, deciding the ‘fair and equitable’ division between the parties (‘the second stage’); and, finally, making the actual division (‘the third stage’). The Judge held that 32 SHD, being an inter-spousal gift, should be included in the pool of matrimonial assets, expressly disagreeing with the High Court decision in Wan Lai Cheng v Quek Seow Kee[2011]2 SLR 814. The Judge then held that the law on matrimonial assets could be reconciled with the law of property on gifts by ordering that the gift form part of the percentage share awarded to the donee spouse at the third stage. Having pooled and valued the respective assets (including 32 SHD) at an amount totalling $6,794,973.09, the Judge awarded a 50:50 division of the matrimonial assets. The Judge then ordered the Husband to pay the Wife maintenance of a lump sum of $288,000. At a subsequent hearing in chambers, the Judge also ordered that the outstanding loan on 32 SHD to be served by both parties on a 50:50 basis.

Both parties appealed against the Judge's decision. Civil Appeal No 135 of 2011 (‘CA 135/2011’) was filed by the Wife and Civil Appeal No 136 of 2011 (‘CA 136/2011’) was filed by the Husband. Summons No 266 of 2012 (‘SUM 266/2012’) was an application taken out by the Wife to adduce further evidence (‘the Further Evidence’) in CA 135/2011.

Held, allowing both CA 135/2011 and CA 136/2011 in part and dismissing SUM 266/2012:

(1) The Wife could not be granted leave to adduce the Further Evidence. The first condition of the test laid down in Ladd v Marshall[1954] 1 WLR 1489, viz, that the evidence could not have been obtained with reasonable diligence for use during the hearings on the ancillary matters, was not satisfied. That the Wife was only ‘alerted’ to the Further Evidence by her new solicitors was insufficient to establish that the evidence could not have been obtained with reasonable diligence earlier: at [22] and [23].

(2) Following the decision in Wan Lai Cheng v Quek Seow Kee[2012] 4 SLR 405, inter-spousal gifts of assets which did not originate from a third-party gift or inheritance (ie, ‘pure’ inter-spousal gifts) were not‘gifts’ for the purposes of s 112 (10) of the Women's Charter (Cap 353, 2009 Rev Ed) (‘the Act’), and therefore constituted matrimonial assets for division (‘the general rule’). 32 SHD, being a ‘pure’ inter-spousal gift, therefore constituted a matrimonial asset for division: at [30].

(3) The only exception to the general rule was where de minimis inter-spousal gifts were concerned. In dealing with de minimis inter-spousal gifts, the court would have the discretion to exclude such gifts from the pool of matrimonial assets. The concepts of ‘proprietary interests’ and ‘inequity’ should, however, no longer constitute exceptions to the general rule: at [48], [51] and [56].

(4) A court which was not dealing with an issue of maintenance could still consider the factors listed in s 114 (1) of the Act in dividing matrimonial assets pursuant to s 112 (2) (h) of the Act: at [38].

(5) It was not possible to reconcile the law on matrimonial assets and the law of property on gifts simply by giving effect to the inter-spousal gift at the third stage. A better solution would be to take the nature and context of the inter-spousal gift into consideration at the second stage via s 112 (1) of the Act to achieve a just and equitable division of the matrimonial assets. In situations where it would be clearly inequitable for a donor spouse to be awarded a substantial share in the asset constituting the inter-spousal gift (or in the form of other assets), the court could take such a situation into consideration under s 112 (1) and award the donee spouse a greater percentage of the overall matrimonial assets (‘the s 112 (1) approach’): at [35] and [41] to [43].

(6) However, based on the s 112 (1) approach, the inter-spousal gift would only be relevant under the second stage if it was evidentially certain that the gift was made in contemplation of divorce, such that allowing the donor spouse to benefit from the asset constituting the inter-spousal gift would be clearly inequitable: at [61].

(7) In the present case, the intentions of both the Husband and the Wife with regard to the purpose behind and the circumstances surrounding the gift of the Husband's share in 32 SHD were objectively unclear. Given the ambiguity of the evidence, the Wife could not succeed in showing that it would be clearly inequitable for the Husband to benefit from 32 SHD being in the pool of matrimonial assets: at [66] and [68].

(8) Notwithstanding that certain payments had yet to be disbursed by the mortgagee bank to the developers of the La Salle Property, this amount of money did nonetheless constitute the outstanding liability of the La Salle Property as at February 2011. Therefore, the correct net value of the La Salle Property as at February 2011 stood at $480,000 instead of the $800,000 accepted by the Judge: at [71] to [73].

(9) The Husband's past CPF contributions towards the purchase of 32 SHD should not be included in the pool of matrimonial assets for that would have been double-counting. However, given that 32 SHD had been awarded to the Wife upon the division of matrimonial assets, the Husband should no longer have to service the outstanding loan of 32 SHD. The Judge's order that both parties service the outstanding loan on 32 SHD on a 50:50 basis was accordingly reversed, and the Wife ordered to serve the outstanding loan on her own: at [74], [75], [77] and [78].

(10) The apportionment of the matrimonial assets on a 50:50 basis by the Judge was not erroneous. The Husband's approach was fundamentally flawed because he treated direct financial contributions as a prima facie starting point, an approach which had been categorically disapproved of in earlier cases. The following reasons could also be offered in support of why the Wife deserved at least half of the matrimonial assets: (a) this was a long marriage (of 28 years); (b) the Wife's non-financial contributions to the household were significant; (c) the Husband's alleged non-financial contributions were unsubstantiated and unreliable; and (d)the Husband's...

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20 cases
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    ...minimal value, and personal items of lower resale value, from the matrimonial pool. The Court of Appeal in Tan Hwee Lee v Tan Cheng Guan [2012] 4 SLR 785 held that courts retained a discretion to exclude items of de minimis value, including inter-spousal gifts, from the matrimonial pool: “t......
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6 books & journal articles
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    • Singapore
    • Singapore Academy of Law Annual Review No. 2015, December 2015
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