TYS v TYT

• Jurisdiction: Singapore
• Judge: Valerie Thean JC
• Judgment Date: 17 March 2017
• Neutral Citation: [2017] SGHCF 7
• Plaintiff Counsel: Wong Soo Chih (Ho Wong Law Practice LLC)
• Docket Number: Divorce Transfer No 6222 of 2012
• Date: 17 March 2017
• Hearing Date: 07 November 2016,13 December 2016
• Subject Matter: Maintenance,Division,Matrimonial assets,Wife,Family law,Child
• Year: 2017
• Defendant Counsel: Michael Moey Chin Woon (M/s Moey & Yuen)
• Court: High Court (Singapore)
• Citation: [2017] SGHCF 7
• Published date: 22 November 2017

Valerie Thean JC: Introduction

The plaintiff (“the Husband”), aged 49, and the defendant (“the Wife”), aged 50, married on 30 January 1996. They have a son, aged 10, who is on the autism spectrum.¹ The parties met while the Wife was a flight stewardess with the Singapore Airlines, where she worked until 2004. She then worked briefly with the National Kidney Foundation until sometime in 2005, when she became a housewife.² The Husband worked previously as a corporate banker and rose to the position of Managing Director and Singapore Market Head in the private wealth management division of a large and reputable international bank. Since 2009, the Husband has been involved in various business interests with partners in the US and China. In February 2012, the Husband relocated to the US, where he worked, to date, as the CEO of [A] Inc, a Nasdaq-listed company.³ The Wife and son remained in Singapore.

The Husband filed for divorce in Singapore on 26 December 2012. The divorce proceeded on an uncontested basis under s 95(3)(e) of the Women’s Charter (Cap 353, 2009 Rev Ed) (“WC”) on the ground of four years’ of continuous separation from 2008. Interim judgment (“IJ”) was granted on 23 September 2013 (“IJ Date”).

I gave oral judgment on parties’ ancillary matters on 13 December 2016. The Husband appealed against my orders on the issues of asset division and maintenance for the Wife and their son. The orders made as to custody, care and control and access for the son are not the subject of appeal. These grounds of decision, accordingly, deal only with asset division and maintenance.

Division of assets Operative date

Parties agreed to use the IJ Date as the date for ascertaining the pool of matrimonial assets liable to division.⁴ In terms of valuation, these were generally taken as at the IJ Date, or valuations as proximate to the IJ Date as available. For the two real properties concerned, the parties agreed to use the latest available values in or around March 2016.

Assets in dispute

In this case, the Wife valued the matrimonial pool at $15,140,095,⁵ while the Husband proffered a valuation of around $3,334,546.⁶ The Wife sought to add the following to the pool: the sale proceeds of the Husband’s shareholdings in companies where he previously held business interests, [B] Ltd and [C] Pte Ltd; the value of the Husband’s shareholdings in two companies, [D] Pte Ltd and [E] Group Ltd; withdrawn deposits from the Husband’s bank accounts which were allegedly not accounted for by the Husband; and the Husband’s unaccounted remuneration since his relocation to the US; and an unreturned balance of $730,000 from a loan of $800,000 purportedly made to the Husband by the Wife.

The Husband, on his part, sought to add back monies withdrawn by the Wife from two bank accounts.

In the result, both parties alleged improper dissipation or concealment of assets by the other party, and each invited me to draw an adverse inference against the other.

Having heard the parties and examined the evidence (including the valuation reports) before me, I determined the total matrimonial asset pool to be $2,686,883.57. I now deal with the disputed assets in turn.

Husband’s proceeds from sale of shares in [B] Ltd

The Husband previously invested in shares of [B] Ltd, which he later sold. The Husband was able to show account statements putting the value of the acquired 100,000 [B] Ltd shares at $26,000.⁷ In his second affidavit, however, he stated that he sold the shares for $25,000.⁸ In submissions, his counsel explained that while the shares had in fact been sold at $25,000, the Husband was prepared to treat the proceeds as amounting to $26,000 on the basis of the account statements.⁹

The Wife valued these shares at a total of $1,139,000, comprising three sums of $39,000, $100,000 and $1,000,000, even though the shares were in fact sold for $25,000. The source for the first figure of $39,000 was a market valuation of the shares, which came from the Husband’s first affidavit¹⁰ and was clarified by his counsel as an error.¹¹ The second figure of $100,000 was explained by the Husband to be the purchase price of the shares. The third figure of $1,000,000 was explained by the Husband to be deposits made to his account by a business partner in order for the Husband to invest on his behalf in the same company, [B] Ltd.¹²

I accepted the Husband’s estimate of the [B] Ltd share proceeds at $26,000 based on the 20 December 2013 Central Depository Account statement reflecting the same.¹³ The alternative value of $39,000, which was the Wife’s first figure, reflected the market value of the shares in February 2013, but those shares had depreciated to around $26,000 by December 2013, which was a date nearer to the IJ Date. There were, however, aspects not entirely satisfactory about the Husband’s explanation. If indeed the shares had been sold at $25,000 as he claimed, there ought to be some evidence of the sale, which was at a quarter of the purchase price of $100,000. Regarding the Husband’s explanation for the Wife’s last figure of $1,000,000, this was explained as a business contact investing in the same company, [B] Ltd through his account, but there was no explanation of their relationship and how the Husband benefitted from what must be some kind of a commercial arrangement. The timing of the relevant deposits and withdrawal of that $1,000,000 sum also did not perfectly match. On the Husband’s own account, the $1,000,000 withdrawal was made in October 2011 while the deposits totalling that amount were made in April and December 2011, which were curiously far apart and the second deposit, ex post the corresponding withdrawal. I was of the view, nevertheless, that since none of the figures provided by the Wife which comprised her estimate of $1,139,000 were attributable to the specific basket of the Husband’s [B] Ltd shares that were being valued as at December 2013, it would be better to consider the oddly-timed deposits and withdrawal as part of the Wife’s larger contention on the need for an adverse inference to be drawn, rather than to use the Wife’s figure as the value of the [B] Ltd shares specifically.

Husband’s proceeds from sale of shares in [C] Pte Ltd

The Wife submitted that $3.1m was paid to the Husband when he sold his shares in [C] Pte Ltd and that he failed to satisfactorily account for those proceeds. The Husband did not dispute that he was paid this $3.1m for a project known as the [Ch] Project. He did, however, submit that these monies were paid to him before the divorce proceedings had commenced, and explained his use of the money by reference to a table setting out the debits from, and credits into, his various investment accounts.¹⁴

From the table drawn up by the Husband for the investment accounts, it appeared that the Husband’s investments yielded a net surplus of $2.1m. This was a substantial sum which expenditure must be accounted for. The Husband’s bald contention was that part of these monies was spent on the family and on mortgage payments for their real properties. In the light of the Husband’s contentions, and there being no value of the expended surplus attributable specifically to these [C] Pte Ltd’s shares, I was of the view that it would be better to deal with the Wife’s submissions on this issue, as with the contentions surrounding the proceeds to be attributed to sale of the shares of [B] Ltd, on a holistic basis under the analysis on adverse inference against the Husband.

Valuation of the Husband’s interests in [D] Pte Ltd and [E] Ltd

The Husband produced valuation reports for his two companies, [D] Pte Ltd, in which the Husband held 50% of its issued shares, and [E] Group Ltd, in which the Husband held 12.5%. [D] Pte Ltd was a joint venture between the Husband and a partner company which was set up in 2009. [E] Ltd, in turn, was a joint venture between [D] Pte Ltd and a Chinese company, set up to invest in [A] Inc. In order to have greater control over [A] Inc as its Asian investors, the Husband became [E]’s nominee director on its Board, and later, its CEO.

These valuation reports showed that [D] Pte Ltd was valued at $97,304 as at 31 December 2015.¹⁵ [E] Ltd, on the other hand, was said to be in negative equity for a sum over US$21m as at 31 December 2015.¹⁶ Both valuations were done on a Net Tangible Asset basis. Thus, the Husband’s position was that his shares in [D] Pte Ltd was worth $48,652 (being 50% of the value of the company) and that no value should be attributed for his shares in [E] Ltd.

The Wife submitted that these valuations, and in particular the report on [D] Pte Ltd, were inaccurate and one-sided. In the [D] Pte Ltd report’s reconciliation of intangible assets, a subsidiary (which was not disclosed and of which nothing was known) was struck off because of a disposal of trading shares “to fund Singapore operation (sic)”. No detail as to that disposal could be found, but some $968,249 arising from goodwill on consolidation of that subsidiary was written off for the 2015 accounts. In the same report’s reconciliation of investments in associate companies, it appeared that the net tangible assets of [D] Pte Ltd at 2014 was $7,970,489, but strangely plummeted the next year to $381,060.¹⁷ The single-line explanation was that this arose from a de-recognition of [E] Ltd, because [D] Pte Ltd’s holding in [E] Ltd was reduced to 25%. The audited accounts upon which the reports were premised were not enclosed within the reports. The Wife questioned the independence of the valuation reports, which she suggested may had been tailored to aid the position of the Husband.¹⁸ The reports were not detailed and the maker of the valuation reports, who had prepared the audited accounts, was cross-examined by counsel for the Wife, without much light being shed. The valuer was not able to explain the various details, and also conceded that there was...