UBM v UBN

• Jurisdiction: Singapore
• Judge: Debbie Ong JC
• Judgment Date: 09 May 2017
• Neutral Citation: [2017] SGHCF 13
• Plaintiff Counsel: Chia Soo Michael and Hany Soh Hui Bin (MSC Law Corporation)
• Date: 09 May 2017
• Docket Number: Divorce (Transferred) No 3601 of 2015
• Hearing Date: 17 January 2017,17 November 2016,26 January 2017
• Subject Matter: Matrimonial Assets,Family Law,Former wife,Family law,Division,Maintenance of Wife,Application of structured approach in ANJ v ANK
• Year: 2017
• Defendant Counsel: Cheong Zhihui Ivan and Chew Wei En (Harry Elias Partnership LLP)
• Court: High Court (Singapore)
• Citation: [2017] SGHCF 13
• Published date: 16 May 2017

Debbie Ong JC: Introduction

This case concerns the division of matrimonial assets in a long marriage of 37 years. The 63-year-old plaintiff (“Husband”) and the 58-year-old defendant (“Wife”) were married in October 1978. They had four children, all of whom were above the age of majority by the time of the divorce. The Husband was the breadwinner during the marriage, and even though he retired in 1999, he continued to provide comfortably for the family through various investments he had made. The Wife took on the role of the homemaker in this marriage. The interim judgment of divorce was granted in December 2015.

After hearing the parties on the financial ancillary matters, I ordered a division of the matrimonial assets between the Husband and the Wife in the ratio 60:40, applying the “structured approach” in ANJ v ANK [2015] 4 SLR 1043.

Shortly after my decision, the Court of Appeal issued its judgment in TNL v TNK and another appeal and another matter [2017] 1 SLR 609 (“TNL v TNK”). It held that the “structured approach” would not be applicable to long “Single-Income Marriages”, in order to ensure that homemaker spouses were not unduly disadvantaged in the division of matrimonial assets. I take this opportunity to explain how I applied the structured approach to the present case, which also concerns a long Single-Income Marriage, to reach an outcome that I consider to be consistent with TNL v TNK.

Division of assets Fundamental legal principles in the power to divide matrimonial assets and the ANJ v ANK approach

Section 112 of the Women’s Charter (Cap 353, 2009 Rev Ed) (“WC”) confers upon the court the power to order the division of the parties’ matrimonial assets. This power is to be exercised in broad strokes, with the court determining what is just and equitable in the circumstances of each case: ANJ v ANK at [17]. The division of assets is founded on the ideology of marriage as an “equal co-operative partnership of efforts”, an ideology which accords equal recognition to spousal contributions whether in the economic or homemaking spheres: NK v NL [2007] 3 SLR(R) 743 at [20].

To accord due and sufficient recognition to each party’s contributions towards the marriage, and especially with a view to avoid overvaluing or undervaluing indirect contributions, the Court of Appeal laid down a “structured approach” in ANJ v ANK to the division of matrimonial assets. Under this approach, the court will, in step 1, ascribe a ratio that represents each party’s direct financial contributions towards the acquisition of the matrimonial assets, relative to that of the other party. In step 2, the court will ascribe a second ratio to represent each party’s indirect contribution to the well-being of the family, relative to that of the other party. The court then derives each party’s average percentage contribution to the marriage. Further adjustments to this average ratio that take into account the other factors enumerated in s 112(2) of the WC and all relevant circumstances may be made to arrive at a just and equitable division of the matrimonial assets (see ANJ v ANK at [22]). The recent decision of the Court of Appeal in TNL v TNK further develops the jurisprudence in s 112 and the use of the structured approach. I will elaborate further on this development of the law from [36] onwards.

Pool of matrimonial assets in the present case

I commend counsel for both parties for presenting clear submissions on what were disputed matters on the one hand, and what were the agreed facts and legal positions on the other. It was evident to me that much thought had been put into ensuring that the court was assisted in these issues. The hearing thus proceeded efficiently.

The parties had agreed that matrimonial assets valued at $9,044,747 were liable to division under s 112 of the WC and that the Husband should return to the pool a sum of $79,000 which he had transferred to one of their daughters in January 2015 to finance her property purchase. These agreed sums make up the main pool of matrimonial assets. The areas of dispute in respect of what other assets were part of the pool of matrimonial assets were, first, whether a property known as “35 JM” is a matrimonial asset and second, whether certain gifts and payments made by the Husband ought to be added back into the pool of matrimonial assets.

Was 35 JM a matrimonial asset?

Whether 35 JM ought to be in the pool of assets was disputed by the parties. 35 JM was a gift from the Husband’s father to him in 1974; it was thus acquired before the marriage. The Husband submitted that it is not a matrimonial asset but agreed that, even if it is not a matrimonial asset, the sum of $660,000 which he had expended to renovate 35 JM in 2012 should be included in the pool of matrimonial assets. The Wife submitted that 35 JM was a matrimonial asset by virtue of s 112(10) of the WC, either because it had been used as a matrimonial home for about 6 years or was substantially improved through her involvement in its renovation during the marriage. Section 112(10) of the WC provides that an asset acquired by either party before marriage is a matrimonial asset if it is ordinarily used or enjoyed by both parties or one or more of their children while the parties are residing together for shelter, transportation, or household, education, recreational, social or aesthetic purposes (s 112(10)(a)(i)), or if the asset was substantially improved during the marriage by the other party or both parties (s 112(10)(a)(ii)).

After considering the available evidence on whether 35 JM was a matrimonial home or a property in which the parties had resided, I reached what I determined to be the more probable position. I was of the view that the parties did not reside in 35 JM, which was the residence of the Husband’s parents at the material time. The Wife submitted that the parties and their children lived at 35 JM from 1978 to 1984 and then at 15 JM, a property located in close proximity to 35 JM, from 1984 to 1991. I rejected her submission and found instead that from 1978 to 1991, the parties resided in 15 JM. The family went to 35 JM often as it was the residence of the Husband’s parents. The children were likely to have spent substantial time with their grandparents at 35 JM when they were younger. 15 JM was sold in 1991. I accepted that 15 JM was available for the parties’ use as their residence. It had earlier been used by the Husband’s older siblings after they were married but before moving to their own properties; this appeared to be the pattern of living arrangements in the Husband’s family. Thus, as there was no convincing evidence that the parties and their children resided at 35 JM for any appreciable length of time, this pre-marriage gift did not become a matrimonial asset by virtue of its use as a place where the parties and their children ordinarily resided, within the meaning of s 112(10)(a)(i) of the WC.

I also considered whether 35 JM was substantially improved either by the Wife or the efforts of both the Husband and the Wife. As mentioned, a pre-marriage asset or a gift that has been “substantially improved during the marriage by the other party or both parties” becomes a matrimonial asset by virtue of s 112(10)(a)(ii) of the WC. In this case, quite apart from whether the Wife had contributed any effort towards any improvement, I find insufficient evidence to prove that there was even a substantial improvement of 35 JM to begin with. The Wife produced a letter, dated 16 May 2016, which she had received from the renovations contractor and which stated that as a result of the renovations done in 2012, the property had “grown in value” by $3 million. No reasons were given by the contractor for using this value. This evidence was not persuasive; not only was the figure chosen by the contractor devoid of any objective justification, it was neither logical nor believable that the property could increase in value by $3 million after the renovations, when its agreed value as at 4 August 2016 was $2.8 million. Further, the Wife did not contribute financially to the cost of renovations and her alleged contributions to substantially improving 35 JM comprised overseeing the renovations and choosing the designs for the property. Such contributions have been regarded by the Court of Appeal as de minimis in the context of whether they constitute substantial improvement to the property: Shi Fang v Koh Pee Huat [1996] 1 SLR(R) 906 at [40]. Although each case must be determined on its own facts, in the light of these difficulties, I did not agree with the Wife that 35 JM was a matrimonial asset by virtue of its substantial improvement by her efforts or both parties’ efforts.

The Wife submitted, and the Husband conceded, that the sum of $660,000 used for renovations to 35 JM ought to be put into the pool of matrimonial assets. At the hearing on 17 January 2017, I asked both counsel to further explain the basis on which this sum could be held to be a matrimonial asset. Counsel submitted that as the monies were earned during the marriage, they are the gains of the marriage and should be put into the pool notwithstanding that they have been used up to pay for the renovations. Having considered this point, I found no reason to include the sum into the pool. This sum has been used up. It is fairly common that monies earned during marriage are spent to acquire more matrimonial assets or used to improve other matrimonial assets. In these more common situations, the assets acquired or improved would be matrimonial assets and the sums used to acquire or improve the assets would thus have been included into the pool of assets. In the present case, however, the asset (35 JM) in relation to which the monies have been used for its renovations is not a matrimonial asset, as explained above. The monies have been utilised and are not in a form available as a matrimonial asset.

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