UDA v UDB and another

• Jurisdiction: Singapore
• Judge: Debbie Ong JC
• Judgment Date: 28 June 2017
• Neutral Citation: [2017] SGHCF 16
• Plaintiff Counsel: Foo Soon Yien (Bernard & Rada Law Corporation)
• Date: 28 June 2017
• Docket Number: Divorce (Transferred) No 844 of 2008 (Registrar’s Appeal No 14 of 2016)
• Hearing Date: 10 October 2016,30 December 2016
• Subject Matter: Matrimonial assets,Procedure,Jurisdiction,Cross-examination,Family law,Intervener,Matrimonial proceedings,Division
• Year: 2017
• Defendant Counsel: Chew Wei En (Harry Elias Partnership LLP),Salem Ibrahim and Koh Kai Ling Angeline (Salem Ibrahim LLC)
• Court: High Court (Singapore)
• Citation: [2017] SGHCF 16
• Published date: 28 April 2018

Debbie Ong JC: Background facts

The parties in this case, Divorce (Transferred) No 844 of 2008, have been in litigation for many years. Although the divorce suit was filed in 2008, the Ancillary Matters on the division of assets and maintenance have not yet been heard. This appears to be largely due to the complex issues and disputes concerning the care and control and access of their three children. The Court of Appeal made a consent order regarding the custody, care and control and access of the children in 2014. While that order was a final one, new developments have led to the parties filing new and further applications over the access of the children. Those applications are pending before me and are separate from matters related to the present appeal.

The parties’ preparations for the hearing of the financial Ancillary Matters gained momentum in the last year or so. The defendant in the underlying divorce suit (“the Husband”) alleged that an immovable property held in the name of the mother of the plaintiff (“the Wife”) is beneficially owned by the divorcing parties and constituted a matrimonial asset. I shall refer to this asset as “PQR”. The Wife’s mother (referred to as “the Intervener”) disputed this and upon her application, was granted leave to participate as an intervener in these proceedings.

The Husband applied for leave to cross-examine in respect of the dispute over the ownership of PQR. The Assistant Registrar (“AR”) granted leave for cross-examination of the Husband, the Wife, and the Intervener. Registrar’s Appeal Nos 14 and 15 of 2016 (collectively, “the appeals”) are the appeals filed by the Intervener and the Wife respectively against the AR’s grant of leave for cross-examination.

The Intervener took the position that the court ought to determine any property dispute involving an intervener together with the issues under s 112 of the Women’s Charter (Cap 353, 2009 Rev Ed) (“WC”) at the Ancillary Matters hearing by way of affidavit evidence. She informed the court through counsel that at the age of 67 years, she is too old to be cross-examined both in the course of the s 112 proceedings and in a civil suit should a writ action be filed. She also cited health reasons as the basis for objecting to being cross-examined.

At the hearing of the appeals, I asked the parties whether the court exercising its power under s 112 has the jurisdiction and power to determine a third party’s interest in a property and make orders against the third party. I directed the parties to file further written submissions on this issue.

The Intervener submitted that although s 112 does not expressly state that the court has power to determine the property rights and interests of an intervener, the court has in the past determined the nature and extent of third party interests before dividing the matrimonial assets between divorcing spouses. She cited several Singapore and English cases to support her submissions. The Intervener submitted in the alternative that even if I did not have jurisdiction to determine a third party’s interests in a disputed property under s 112 of the WC, I have the jurisdiction to do so under ss 22 and 25 of the Family Justice Act 2014 (No 27 of 2014) (“FJA”) and ss 16, 17 and the First Schedule of the Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) (“SCJA”).

The Husband submitted that the civil aspect of the issue “ought to be dealt with as a civil matter would normally”. He argued that s 112 does not apply to the determination of third parties' property rights. A separate civil suit should be commenced by either the Intervener or the divorcing parties in relation to PQR. He suggested, alternatively, that the English approach could be adopted where a preliminary civil hearing is first held to determine the Intervener’s property interest before proceedings continue in the Family Division of the High Court. In the present case, the Husband told the court that he wished to also bring a conspiracy suit against the Wife and the Intervener. He submitted that the family court proceedings would not be appropriate for a conspiracy suit given the lack of trial procedures. The Husband through his counsel explained to the court that he had not taken out a separate writ action because he was concerned with cost implications in the event an argument is made that a separate writ action was unnecessary since the court could have determined the matter within the s 112 proceedings.

After hearing the parties and considering their further written submissions, I ordered a stay of the Ancillary Matters proceedings to allow the Husband the opportunity to pursue a civil action to determine the disputed property interests first. The Intervener then filed an application for leave to appeal to the Court of Appeal in respect of my decision in Registrar’s Appeal No 14 of 2016 to stay the Ancillary Matters proceedings pending further directions. Leave for appeal to the Court of Appeal was granted to the Intervener.

Although the decision being appealed is of an interlocutory nature, that is, to stay the financial Ancillary Matters proceedings, I will give full reasons for why a stay of proceedings was fair and just, including my views on the nature and scope of the court’s powers in s 112 of the WC.

Third parties or interveners in s 112 WC proceedings

In most cases, the alleged pool of matrimonial assets does not involve property that may be owned by or co-owned with a third party, such as a relative of one of the parties to the divorce. However, in some cases, a divorcing spouse may allege that an asset held in the name of a person other than the spouses is beneficially owned by one or both of the spouses and may thus constitute a matrimonial asset. In these cases, the beneficial ownership of such an asset must first be decided in order for the court to determine the constitution of the entire pool of matrimonial assets liable for division under s 112.

A person who is not a party to the terminated marriage but whose property is alleged to be a matrimonial asset may seek leave to intervene or be added as a party in the Ancillary Matters proceedings. This appears to be pursuant to r 353 or r 367 of the Family Justice Rules 2014 (“FJR”). If the court directs that the third party (or “intervener”, or “non-spouse”) may participate in the proceedings, he or she would have a right to be heard in the s 112 proceedings. Whether or not the court has the jurisdiction and power to make an order in respect of the disputed property against the third party (or in favour of the third party) is a separate question, which I shall address below. A crucial issue arising in the present case is whether the addition of an intervener or a third party affects and in particular, expands, the court’s jurisdiction and power in s 112 such that orders made pursuant to s 112 may extend to making orders binding third parties. A further related issue is whether the addition of a third party sufficiently invokes the court’s jurisdiction and power in a new and different cause of action which can be heard within the s 112 proceedings.

Approaches

There are a few suggested approaches to addressing the issue presented by the current facts. These approaches may be in the nature of case management or substantive law, or a mixture of both characteristics. The following discussion is not exhaustive of all possible approaches, and they include an approach suggested in the submissions which I do not view as correct in law.

Option 1: Determine the property interests in s 112 proceedings but make no direct order against the intervener that affects the disputed property Option 1(a)

In what I refer to as Option 1(a), the court exercising its s 112 power proceeds to hear the evidence of the intervener and the divorcing parties in order to determine whether the disputed asset is a matrimonial asset. It may do so on affidavit evidence only or may also permit cross-examination of relevant witnesses in respect of the specified issues in dispute.

There are two possible outcomes. First, if, after considering all the relevant evidence, the court decides that neither party to the marriage has any beneficial interest in the disputed asset, that asset is not included in the pool liable to division under s 112. The court then orders the division between the parties of their matrimonial assets (which does not include the disputed asset).

If, on the other hand, the court is of the view that at least one party has beneficial interest in the disputed asset, that asset (or part of it) may possibly be a matrimonial asset liable to division, if it falls within s 112(10) of the WC. In such a situation, it may be possible for the court to include the disputed asset in the pool to be divided, yet make no order that directly affects that asset. For example, if the court determines that Asset X, which is held in the sole name of the intervener, is beneficially owned by the husband (perhaps by a finding of a resulting trust), it may include Asset X in the pool of assets such that the total pool has a higher value than it would otherwise have. However, the court may make consequential orders which only directly affect the other assets in the pool but not Asset X. The court’s order is one that divides certain matrimonial assets between the divorcing parties. It is an approach that is feasible where there are substantial matrimonial assets to be divided apart from the disputed asset.

This approach was taken by the High Court in Lau Loon Seng v Sia Peck Eng [1999] 2 SLR(R) 688. In that case, it was determined that the shares held in the names of the third parties belonged beneficially to the husband. The third parties did not intervene in the proceedings. The court ordered the husband to pay the wife the value of her interest in the shares determined by the court. It did not make an order for the sale or transfer of...