VJP v VJQ

• Judge: Andrew Phang Boon Leong JCA
• Judgment Date: 12 August 2021
• Neutral Citation: [2021] SGCA 82
• Citation: [2021] SGCA 82
• Defendant Counsel: Oh Kim Heoh Mimi (Ethos Law Corporation)
• Hearing Date: 04 May 2021
• Plaintiff Counsel: Low Hong Quan and Tan Hoe Shuen (Silvester Legal LLC)
• Docket Number: Civil Appeal No 210 of 2020
• Published date: 17 August 2021
• Court: Court of Appeal (Singapore)
• Subject Matter: Family Law,Matrimonial assets,Division

Andrew Phang Boon Leong JCA (delivering the judgment of the court): Introduction

This appeal is concerned with only one question: where an appellate court excludes certain assets that were originally included in the matrimonial pool by the lower court, should the appellate court recompute the distribution of the reduced pool of matrimonial assets by adopting the same division ratio adopted by the lower court?

The appellant wife and the respondent husband were married for eight and a half years before they were divorced in 2018. In the ancillary matters proceedings, the District Judge adopted the structured approach in ANJ v ANK [2015] 4 SLR 1043 (“ANJ v ANK” and “the ANJ approach”) in dividing the matrimonial assets and assessed the average division ratio to be 56:44 in favour of the husband (see VJP v VJQ [2020] SGFC 62 (“the District Judge’s decision”)).

The parties filed cross-appeals against the District Judge’s decision. The High Court judge (“the Judge”) allowed both appeals in part and held that certain assets were to be excluded from the matrimonial pool (see VJQ v VJP and another appeal [2020] SGHCF 13 (“the Judge’s decision”)). However, the Judge did not adjust the division ratio that the District Judge had arrived at. It is this narrow aspect of the Judge’s decision that the wife challenges.

In CA/OS 41/2020 (“OS 41”), we granted the wife leave to appeal on the issue set out at [1] above. Before analysing this issue proper, we first set out the decisions of both the District Judge and the Judge.

The District Judge’s decision

As the husband and the wife were both working, it was undisputed that the ANJ approach applied to the division of matrimonial assets (see the District Judge’s decision at [10]). The ANJ approach entails the following steps: (a) ascribing a ratio to the parties’ direct contributions; (b) ascribing a ratio to the parties’ indirect contributions; (c) deriving each party’s average percentage contributions; and (d) if necessary, making further adjustments to the parties’ average percentage contributions (see ANJ v ANK at [22]).

The District Judge valued the matrimonial pool at $2,305,219.75 (see the District Judge’s decision at [11]). The pool of matrimonial assets comprised assets held by each party solely as well as two jointly-held assets, namely, a Housing and Development Board (“HDB”) flat (“the HDB flat”) and a condominium (“the Condominium”). Two assets are relevant for present purposes: the Condominium and the husband’s shares in Primefield Group Pte Ltd (“Primefield”).

The District Judge held that the net value of the Condominium was $658,188.81 (see the District Judge’s decision at [11]). This net value was arrived at after deducting the outstanding housing loan of $716,811.19 but not the undisbursed loan amount of $176,250. The District Judge explained that the value of the matrimonial assets ought to be ascertained as at the date of the ancillary hearing in February 2020, whereas the $176,250 loan would only be disbursed in around May 2020 (see the District Judge’s decision at [11]).

The District Judge also valued the husband’s Primefield shares at $140,000, which was the price at which he had purchased those shares. She noted that the husband’s option to sell the Primefield shares at $168,000 had expired on 15 May 2017 (see the District Judge’s decision at [11]).

Having valued all the matrimonial assets, the District Judge found that the ratio of the parties’ direct contributions to the acquisition of those assets was 67:33 in the husband’s favour (see the District Judge’s decision at [16]). She also assessed the ratio of the parties’ indirect contributions at 45:55 in the wife’s favour (see the District Judge’s decision at [19]). Taking the average of the two ratios, the District Judge held that the overall division ratio was 56:44 in the husband’s favour (see the District Judge’s decision at [21]).

The District Judge valued the husband’s 56% share of the matrimonial pool at $1,291,531.89 (see the District Judge’s decision at [22]). We note that this figure ought to have been $1,290,923.06, being 0.56 x $2,305,219.75. After deducting the husband’s sole assets of $820,577.03, the District Judge found that he was entitled to a further sum of $470,954.86. As the husband wished to take over the HDB flat, which was worth $535,000, the District Judge ordered him to pay the wife an approximate sum of $65,000, ie, $535,000 - $470,954.86 (see the District Judge’s decision at [22]). The husband was also ordered to transfer his share in the Condominium to the wife for no consideration (see the District Judge’s decision at [32]).

The Judge’s decision

The husband and the wife filed cross-appeals against the District Judge’s decision. Both appeals were allowed in part.

The husband claimed that the Primefield shares were worthless. According to him, the shares were an investment in which he was to receive $168,000 upon re-selling them back to the vendor by a certain date (likely 15 May 2017), but he had failed to do so and thus did not get his money back (see the Judge’s decision at [2]).

The Judge accepted the husband’s claim that the Primefield shares were probably worthless. He noted that the shares had been purchased two years before the divorce and accepted that the husband’s investment had been lost either through the vendor’s deception or the husband’s own negligence (see the Judge’s decision at [3]). The Judge thus held that the sum of $140,000, being the purchase price of the Primefield shares, ought to be excluded from the matrimonial pool (see the Judge’s decision at [3] and [10(a)]).

The Judge also held that the undisbursed loan amount of $176,250 for the Condominium constituted an outstanding liability that ought to be deducted from the matrimonial pool (see the Judge’s decision at [5] and [10(b)]).

The wife’s applications for leave to appeal against the Judge’s decision

In HCF/SUM 287/2020 (“SUM 287”), the wife sought leave from the High Court to appeal against the Judge’s decision in respect of, among other things, his findings on the husband’s Primefield shares. The Judge dismissed the wife’s application. Counsel for the wife, Mr Low Hong Quan, appeared to have queried if the sum of $65,000 due from the husband to the wife, as held by the District Judge, ought to be revised. The Judge answered in the negative:

Low:	$65,000 to be paid by husband to wife. That’s [District Judge].
	This court says the $176,250 should be taken out. So the wife’s share should be reduced accordingly.
Court:	No change required – just the $65,000.

It is the Judge’s decision that the amount due from the husband to the wife was to remain at $65,000 that has led to the present appeal.

After SUM 287 was dismissed, the wife applied to this court, by way of OS 41, for leave to appeal against the Judge’s decision. We granted her leave to appeal on the following issue only:

When an appellate court decides that certain items of assets should be deducted from the pool of matrimonial assets determined by the lower court and maintains the parties’ percentage shares and the lower court has computed the distribution between the parties in those percentage shares based on the pool as found by the lower court, should the appellate court recompute the distribution on the same percentages based on the reduced pool as found by the appellate court?

The parties’ cases The wife’s case

The wife’s case is straightforward. She contends that the net value of the matrimonial pool has changed due to the Judge’s exclusion of the Primefield shares and the undisbursed loan amount for the Condominium from the matrimonial pool. As such, the Judge ought to have recalibrated the ratio of the parties’ direct contributions, as a consequence of which the final division ratio would also have changed. She submits that the overall division ratio should be recalculated as 44.8:55.2 in the husband’s favour and that her share should be rounded up as 45%.

The wife also takes issue with the Judge’s exclusion of the Primefield shares from the matrimonial pool as the shares were not acquired by way of gift or inheritance and the exclusion of the shares was not attributable to any fault of hers. She asserts that she did not receive any corresponding benefit or “compensation” on account of the exclusion of the shares from the matrimonial pool. In contrast, the husband retained “the full benefits of the shares as a paper asset (at a very minimum)”. In this regard, she highlights that the Primefield shares “are not a total write-off” as Primefield is still a live company. The wife thus submits that the court ought to apply a 5% uplift to her 44.8% share of the matrimonial shares, thereby arriving at a final division ratio of 47:53 as between herself and the husband respectively.

The husband’s case

The husband makes three main arguments. First, he submits that the ratio of the parties’ direct contributions need not be recomputed because the division of matrimonial assets is a matter for the court’s discretion. In exercising its discretion, the court should adopt a “broad brush” approach instead of proceeding on “arithmetical logic”. Second, he argues that there is no basis for appellate intervention because the overall division ratio (of 44:56 in his favour) derived by the District Judge is not clearly inequitable or wrong in principle. The re-computation of the parties’ direct contributions would, according to him, amount to a backdoor for the wife to recalculate the division of the matrimonial assets. Third, he notes that the Judge did not adjust the amount that the wife was to receive as her share of the matrimonial assets. This means that, following the Judge’s decision, the wife effectively obtained a larger percentage of the reduced pool of matrimonial assets. The husband thus submits that...