Court of Appeal · Decided 31 July 2012

Wan Lai Cheng v Quek Seow Kee and another appeal and another matter

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[2012] SGCA 40Case no. Civil Appeals Nos 17 and 21 of 2011, and Summons No 2864 of 2011

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Andrew Phang Boon Leong JA:
Introduction
[1] These are two related appeals filed by the husband, Quek Seow Kee (“the Husband”), and the wife, Wan Lai Cheng (“the Wife”), respectively, against the decision of the High Court judge (“the Judge”) in Wan Lai Cheng v Quek Seow Kee [2011] 2 SLR 814 (“the Judgment”) with regard to: (a) the division of matrimonial assets, and (b) the maintenance for the Wife. Civil Appeal No 17 of 2011 (“CA 17/2011”) is filed by the Wife, and Civil Appeal No 21 of 2011 (“CA 21/2011”) is filed by the Husband. Summons No 2864 of 2011 (“SUM 2864/2011”) is an application taken out by the Husband in relation to CA 21/2011.
Facts
Parties to the dispute
[2] The parties were married in Singapore on 31 October 1972 when they were both 26 years old. The marriage lasted for 36 years. The Husband comes from a wealthy family and is self-employed. The Wife was a teacher until her retirement in 2008. The parties are both currently 66 years old.
[3] There are two children of the marriage (Darren and Daniel), who are both in their 30s, and for whom no provision has to be made in the divorce proceedings.
Background to the dispute
[4] On 26 July 2007, the Wife filed for divorce (in the Judgment, the date of commencement of the divorce proceedings is stated as 27 July 2007 (see, inter alia, [33] of the Judgment), but the correct date is actually 26 July 2007). The fact relied on to prove the irretrievable breakdown of the marriage was that the Husband had behaved in such a way that the Wife could not reasonably be expected to live with him. The interim judgment was granted by the Family Court on 20 August 2008.
[5] Currently, both parties continue to stay at No 2 Draycott Park #03-01 Hampton Court (“the Matrimonial Home”), which is one of 12 units within a condominium development called “Hampton Court”.
[6] Hampton Court is constructed on land which belonged to the Husband’s late grandfather, Mr Quek Bak Song, who was the chairman of the now defunct Overseas Union Bank. This land was inherited by the Husband and his brothers from their late father, who had, in turn, inherited it from Mr Quek Bak Song. The Husband received three units in Hampton Court, comprising the Matrimonial Home and two smaller units, viz, #02-01 and #03-02 of Hampton Court. On the advice of Ernst & Young, the Husband incorporated Hawick Property Investment Pte Ltd (“Hawick”) to hold #02-01 of Hampton Court and Kelso Property Investment Pte Ltd (“Kelso”) to hold #03-02 of Hampton Court.
[7] A third company, Skeve Investment Pte Ltd (“Skeve”), was incorporated to hold a condominium apartment, #24-06 of The Riverwalk (“the Riverwalk property”), which was purchased by the Husband in 1983. Hawick, Kelso and Skeve will be collectively referred to as “the Three Companies”. As I will make clear later in my judgment (see below at [61], [62] and [74]), the difference between the origins of the properties held by Hawick and Kelso on the one hand and the origins of the property held by Skeve on the other is crucial.
[8] The Wife became a shareholder and director of Hawick and Kelso in 1992, and of Skeve in 1983. The Wife is currently the registered owner of 40% of the shares in Hawick, 40% of the shares in Kelso and 10% of the shares in Skeve (the Wife’s shares in Hawick and Kelso will hereafter be referred to as “the Hawick and Kelso shares”, and her shares in Skeve as “the Skeve shares”). The Wife did not pay for the Hawick and Kelso shares and the Skeve shares (collectively, “the Shares”), and was never in possession of the share certificates.
[9] There was a dispute in the court below as to whether the Shares belonged to the Wife beneficially or whether she held them on trust for the Husband. This is a significant issue as each of the Three Companies holds (as noted above) a unit of valuable residential property. The Judge found that the Shares had been transferred by the Husband to the Wife absolutely (see the Judgment at [18]). This finding is not contested by the Husband on appeal. The present appeals thus proceed on the basis that the Shares were an inter-spousal gift from the Husband to the Wife.
[11] The Wife’s contributions to the marriage were largely indirect and non-financial. She played a supportive and passive role in the marriage. She has never owned a property in her name.
The decision below
[12] The Judge made the following findings in the court below:
(a) On a finding of fact, the Shares were gifts made by the Husband to the Wife (see the Judgment at [18]).
(b) Inter-spousal gifts were “gifts” for the purposes of s 112(10) of the Women’s Charter (Cap 353, 2009 Rev Ed) (“the current Act”), and were thus not matrimonial assets unless there was evidence that the gifts had been substantially improved during the marriage by the donor spouse or by both parties to the marriage (see the Judgment at [28]–[29]).
(c) There was no claim or evidence that the Husband (the donor spouse in the present case) had substantially improved the value of the Shares, whether by himself or together with the Wife. Therefore, the Shares were not matrimonial assets but were instead the Wife’s assets (see the Judgment at [19] and [30]).
(d) Section 112(2)(h) and s 114(1)(a) of the current Act, read together, required a court, when dividing matrimonial assets, to have regard to, inter alia, the property of each of the parties to the marriage. As the Shares were the Wife’s property, they would be taken into consideration in determining her share of the matrimonial assets (see the Judgment at [30]–[31]).
(e) The Wife was awarded 35% of the net asset value (“NAV”) of the Matrimonial Home, which was to be taken as at the date of commencement of the divorce proceedings (ie, 26 July 2007), or, alternatively, rounded off to 31 July 2007 if that did not prejudice the Husband (see the Judgment at [36] and [39]).
(f) The Wife was further awarded 25% of all the other matrimonial assets, excluding the Matrimonial Home and the remainder of the shares in the Three Companies that were not registered in her name, subject to the following (see the Judgment at [43]–[45]):
(i) the NAV of the Costa Rhu property was to be calculated in the same way as the NAV of the Matrimonial Home;
(ii) the bank balances of each party were to be taken as at the date of commencement of the divorce proceedings;
(iii) the boat “Delightful Dream” registered in the name of the Husband and held on trust for Skeve was not to be included in the division; and
(iv) the Renault car registered in the name of the Husband and given as a wedding present to Daniel was not to be included in the division.
(g) The Matrimonial Home and the Costa Rhu property were to be valued and sold, or, alternatively, transferred by sale to the sole name of either of the parties. If the parties could not reach an agreement, either party could apply to the court for directions (see the Judgment at [47]).
(h) The Husband was ordered to pay the Wife monthly maintenance of $2,000 (see the Judgment at [52]).
Issues on appeal
[13] The following issues were raised on appeal:
(a) whether inter-spousal gifts are “gifts” for the purposes of s 112(10) of the current Act (referred to hereafter as either “s 112(10)” per se or “the current s 112(10)”, as may be appropriate to the context), and are thus not matrimonial assets unless there is evidence that the gifts have been substantially improved during the marriage by the donor spouse or by both parties to the marriage (“Issue 1”);
(b) if Issue 1 above is answered in the affirmative, whether the inter-spousal gift in this case, ie, the Shares, had been substantially improved by the Husband (the donor spouse) or by both parties during the marriage, and thus brought into the pool of matrimonial assets for division (“Issue 2”);
(c) what the appropriate operative date for determining the NAV of the Matrimonial Home and the Costa Rhu property (and by implication, the NAV of any other property included in the pool of matrimonial assets for division) is (“Issue 3”);
(d) whether the division of matrimonial assets made by the Judge was just and equitable within the meaning of s 112 of the current Act (“Issue 4”); and
(e) whether a lump sum maintenance should have been awarded in the court below instead of monthly maintenance, and, if so, what the lump sum should be (“Issue 5”).
[14] I turn now to consider each of the above-mentioned issues seriatim.
My decision
Issue 1
Overview
[15] As noted above, what has to be ascertained with regard to Issue 1 is whether inter-spousal gifts are “gifts” for the purposes of s 112(10), and are thus not matrimonial assets unless there is (as stipulated in s 112(10)) evidence that the gifts have been substantially improved during the marriage by the donor spouse or by both spouses.
The Husband’s case
[16] The Judge’s decision that inter-spousal gifts were “gifts” under s 112(10) and were excluded from the pool of matrimonial assets (unless the inter-spousal gifts had been substantially improved during the marriage by the donor spouse or by both spouses) had the effect that the Shares were the Wife’s assets and not matrimonial assets. Apropos this ruling, counsel for the Husband, Mr Randolph Khoo (“Mr Khoo”), argues – apparently contrarily to the express language of s 112(10) – that inter-spousal gifts are matrimonial assets. Mr Khoo notes that this was the legal position prior to the amendments made on 1 May 1997 to the then equivalent of the current Act (viz, the Women’s Charter (Cap 353, 1985 Rev Ed) (“the 1985 Act”)), and contends that the said amendments (“the 1997 Amendments”) did not change the law in this regard. He raises four specific arguments in support of his case, as follows:
(a) Firstly, it is argued that the Judge construed s 112(10) in a way that altered the common law position on inter-spousal gifts as it stood at the time of the 1997 Amendments, and this contravened the applicable principle of statutory interpretation (as embodied within decisions such as Ying Tai Plastic & Metal Manufacturing (S) Pte Ltd v Zahrin bin Rabu [1983–1984] SLR(R) 212 at [19] and Ng Boo Tan v Collector of Land Revenue [2002] 2 SLR(R) 633 at [79]) in so far as the then equivalent of s 112(10) had not utilised language that pointed unmistakably to that conclusion.
(b) Secondly, it is argued that there is material that points in the opposite direction from the Judge’s view, and that this material should be used as an aid to the interpretation of s 112(10). In particular, Mr Khoo highlights the following material:
(i) Report of the Select Committee on the Women’s Charter (Amendment) Bill (Bill No 5/96) (Parl 3 of 1996, 15 August 1996) (“the Select Committee Report on Bill 5/96”), which opined (at para 5.5.5) that “the body of case law built up over the years would not be disregarded by judges, but would be used to guide the judges in their [judgments]”; and
(ii) the statement by Mr Abdullah Tarmugi, the then Minister for Community Development, on 27 August 1996 during the third reading of the Women’s Charter (Amendment) Bill 1996 (Bill 5 of 1996) (“Bill 5/96”), ie, the Bill that led to the enactment of (inter alia) the provision which is now s 112 of the current Act, that “it [was] not the intention for the body of case law built up over the years to be cast aside, but that it should continue to serve as a guide to judges in their decisions” (see Singapore Parliamentary Debates, Official Report (27 August 1996) vol 66 at col 527).
(c) Thirdly, Mr Khoo cites the following views of Prof Leong Wai Kum (“Prof Leong”) in her book, Elements of Family Law in Singapore (LexisNexis, 2007) (at p 602):
(d) Fourthly, it is argued that at least two cases decided after the 1997 Amendments (viz, Yow Mee Lan v Chen Kai Buan [2000] 2 SLR(R) 659 (“Yow Mee Lan”) and Yeo Chong Lin v Tay Ang Choo Nancy and another appeal [2011] 2 SLR 1157 (“Yeo Chong Lin”)) demonstrate that the Singapore courts continue to regard inter-spousal gifts as matrimonial assets.
The Wife’s case
[17] Counsel for the Wife, Ms Luna Yap (“Ms Yap”), submits that the Judge’s ruling that inter-spousal gifts are not matrimonial assets for division accords with a plain reading of s 112(10). In the alternative, Ms Yap argues (and this is also in response to the Husband’s fourth argument) that Yow Mee Lan and Yeo Chong Lin can be distinguished from the instant case.
The definition of “matrimonial asset”
[18] The definition of “matrimonial asset” in the current s 112(10) reads as follows:
[19] The words italicised in the quotation in the preceding paragraph will hereafter be referred to as “the Exclusion Clause”. It must be noted that the literal language of the Exclusion Clause does not, on its face, distinguish between inter-spousal gifts and gifts from third parties, but appears to exclude all gifts from the definition of “matrimonial asset”. Hence, in order to answer Issue 1, it is necessary to look not only to the plain words of s 112(10), but also to the legislative history and context of s 112(10).
The legislative history and context of s 112(10)
(1) The law prior to the 1997 Amendments
[20] Prior to the 1997 Amendments, the provision which governed the division of matrimonial assets was s 106 of the 1985 Act (“the former s 106”), which reads as follows:
As can be seen, the former s 106 did not expressly exclude gifts from the pool of matrimonial assets to be divided. In fact, the provision made no reference whatsoever to gifts, whether inter-spousal or from third parties. It also did not contain any definition of “matrimonial asset”.
[21] Turning now to the relevant case law, in the decision of this court in Yeo Gim Tong Michael v Tianzon Lolita [1996] 1 SLR(R) 633 (“Yeo Gim Tong Michael”), the court had to decide whether a gift from the husband to the wife could be taken into account in the division of matrimonial assets under the former s 106. The court observed thus:
[22] Yeo Gim Tong Michael therefore drew a distinction between assets acquired as: (a) inter-spousal gifts, and (b) gifts from third parties, the legal position in respect of which may be summarised as follows:
(a) With regard to inter-spousal gifts, where the gift was of substantial value, it came within the class of assets covered by the former s 106, and could be taken into account in the division of matrimonial assets. Whether an inter-spousal gift was to be regarded as a matrimonial asset was dependent on the facts of each case. No special considerations applied to inter-spousal gifts which were treated as matrimonial assets beyond the considerations listed in the former s 106. For practical purposes, inter-spousal gifts of de minimis value were not taken into account in the division of matrimonial assets.
(b) With regard to gifts from third parties, these were outside the class of assets covered by the former s 106 and were thus not considered for division. The only assets countenanced by the former s 106 as divisible were those acquired either: (i) by the joint efforts of the spouses, or (ii) by the sole effort of one of the spouses, and gifts from third parties fell into neither category.
[23] In the present appeals, the Husband and the Wife both agree that Yeo Gim Tong Michael is an accurate statement of the position prior to the 1997 Amendments as to whether or not gifts (be they inter-spousal gifts or third-party gifts) form part of the pool of matrimonial assets for division. This view was also shared by the Judge.
(2) The 1997 Amendments
[24] The Select Committee set up to consider amendments to the 1985 Act (“the Select Committee”) received proposals from, inter alia, Prof Leong and the Law Reform Committee of the Singapore Academy of Law (“the Law Reform Committee”) as to how “matrimonial asset” could be statutorily defined.
[25] Prof Leong’s proposed definition of “matrimonial asset” included inter-spousal gifts (which Prof Leong distinguished from third-party gifts) and was crafted as follows (see the Judgment at [25]):
[26] The Law Reform Committee’s proposed definition of “matrimonial asset” likewise distinguished between inter-spousal gifts (to be treated as matrimonial assets) and gifts from third parties (prima facie not to be treated as matrimonial assets), and suggested that a matrimonial asset (see the Judgment at [26]):
[27] The salient paragraphs of the Select Committee Report on Bill 5/96 state as follows in respect of the definition of “matrimonial asset”:
[28] The former s 106 was amended via the Women’s Charter (Amendment) Act 1996 (Act 30 of 1996), which came into effect on 1 May 1997. In the amended version of the former s 106 (“the new s 106”), Parliament enacted the following definition of “matrimonial asset”:
[29] As can be seen, the wording of the new s 106 is identical in all material aspects to that of the current s 112(10), the only difference being that the phrase “For the purposes of this section” in the new s 106(10) was subsequently amended (by the Statutes (Miscellaneous Amendments) (No 2) Act 2005 (Act 42 of 2005)) to read as “In this section” in s 112(10) of the Women’s Charter (Cap 353, 1997 Rev Ed), which is the immediate predecessor of the current s 112(10).
[30] Both the new s 106 and the current s 112(10) contain the Exclusion Clause, which expressly excludes assets (except the matrimonial home) obtained by gift or inheritance from the pool of matrimonial assets for division. The Exclusion Clause contains an exception for assets (acquired by gift or inheritance) that have been “substantially improved” during the marriage either by the “other” spouse, ie, the spouse who was the non-recipient of the gift or inheritance (“the non-recipient spouse”), or by both spouses (hereafter referred to as “the ‘substantial improvement’ exception”). Where the “substantial improvement” exception is satisfied, the gift or inheritance in question falls within the statutory definition of “matrimonial asset”. Thus, on the face of the wording of both the new s 106 and the current s 112(10), all gifts and inherited assets are to be excluded from the pool of matrimonial assets for division, unless the “substantial improvement” exception is satisfied.
[31] Accordingly, on a literal reading of s 112(10), it appears that the Judge was correct in holding that inter-spousal gifts were excluded from the definition of “matrimonial asset”. In the court below, the Judge opined as follows (see the Judgment at [27]):
[32] In the circumstances, the Judge held that the definition of “matrimonial asset” in s 112(10) did not support the interpretation that inter-spousal gifts were matrimonial assets. The 1997 Amendments had, in his view, changed the law.
[33] With the legislative background set out briefly above in mind, I turn now to address the respective parties’ arguments as well as give my decision with regard to Issue 1.
My analysis and decision
[34] As noted above, a plain reading of s 112(10) supports the Judge’s decision in the court below that inter-spousal gifts are “gifts” and are thus not matrimonial assets for the purposes of this provision, unless the “substantial improvement” exception is satisfied. I turn now to consider the four arguments raised by Mr Khoo on behalf of the Husband as to why this plain reading of s 112(10) is wrong.
[35] In my view, the first and third arguments proffered by Mr Khoo are, with respect, not very helpful.
[36] Turning to the first argument (see above at sub-para (a) of [16]), whether or not s 112(10) unmistakably abrogated the position existing at common law prior to the 1997 Amendments is precisely the issue that has to be decided in the present appeals. In order to arrive at a conclusion on that issue, this court has to decide whether or not the ostensibly plain language of s 112(10) is not so plain in the final analysis. The mere invocation by Mr Khoo of a principle of statutory interpretation (viz, the principle that a statute should not be construed as effecting any fundamental changes in the common law unless it uses words which point unmistakably to that conclusion) does not, in and of itself, aid this court in this particular regard, for the issue at hand cannot be decided in the abstract.
[37] The third argument (see above at sub-para (c) of [16]) is based on Prof Leong’s views in her book (viz, Elements of Family Law in Singapore), which, in turn, reiterates her proposal to the Select Committee (as set out above at [25]). In the circumstances, this particular argument is, at best, neutral, for much would turn on whether or not the Select Committee accepted – either directly or indirectly – Prof Leong’s proposal. In my view, there was clearly no direct adoption of the proposal (see paras 5.5.6–5.5.7 of the Select Committee Report on Bill 5/96), although there could arguably have been indirect adoption, which, in substance, constitutes the basis of Mr Khoo’s second argument – to which my attention must now turn.
[38] In respect of Mr Khoo’s second argument (see above at sub-para (b) of [16]), viz, that neither the Select Committee nor Parliament intended to abrogate the legal principles embodied in the existing body of case law at the time of the 1997 Amendments, it appears to me that this argument, whilst not wholly without merit, would need to be undergirded by general principles of both logic as well as common sense in order to be sustainable. In particular, was there a rational basis for the court in Yeo Gim Tong Michael to distinguish, as it did, between inter-spousal gifts on the one hand and gifts from third parties on the other (see above at [21] and [22])? If there was such a basis, then it is clear that there is nothing, not even in the literal language of the current s 112(10), which clearly contradicts such a distinction on the premise that (in accordance with Mr Khoo’s second argument) neither the Select Committee nor Parliament intended the word “gift” in the then equivalent of the current s 112(10) to have any broader meaning than that which existed at the time that provision was enacted, which was that the word “gift” referred solely to a gift from a third party (and not to an inter-spousal gift). If there is indeed a rational basis to distinguish between inter-spousal gifts and third-party gifts, this would explain why the Singapore courts have continued to regard inter-spousal gifts as falling within the pool of matrimonial assets for division on at least two occasions after the 1997 Amendments (viz, in Yow Mee Lan and Yeo Chong Lin), which is, of course, Mr Khoo’s fourth argument (see above at sub-para (d) of [16]).
[39] For this fourth argument, it suffices to say that I have not based my decision in the present appeals on any similarity of factual background with the cases of Yow Mee Lan and Yeo Chong Lin, but have instead arrived at my decision from an examination of the legal principles embedded in the case law, which principles are applicable to all cases in this area of the law. In other words, my decision does not turn on whether the facts in Yow Mee Lan and Yeo Chong Lin can be distinguished from those in the present appeals. I will instead endeavour to explain the logical basis behind my analysis of the word “gift” in s 112(10).
[40] Turning then to the point of general principle, it is clear, in my view (and with respect to the Judge), that inter-spousal gifts were not intended by Parliament to fall within the ambit of the word “gift” in s 112(10). Let me elaborate. An inter-spousal gift embodies, by its very nature, the initial effort expended by the donor spouse in, as this court put it in Yeo Gim Tong Michael (at [12]), “the original acquisition of [the] gift”. If, therefore, such a gift were excluded from the pool of matrimonial assets, the initial effort expended by the donor spouse in the acquisition of the gift would simultaneously be denied recognition – a result which prompted this court in Yeo Gim Tong Michael to arrive at the decision that an inter-spousal gift ought to remain as part of the pool of matrimonial assets. This decision is, in my view, just and equitable inasmuch as the result is that whilst ownership of an inter-spousal gift resides in the donee spouse as a result of the transfer of that gift by the donor spouse, the initial effort of the donor spouse in the acquisition of the gift is nevertheless acknowledged and recognised – thus achieving a balance.
[41] In this regard, it may be observed that as inter-spousal gifts are not “gifts” for the purposes of s 112(10), there is no need to invoke the “substantial improvement” exception in the Exclusion Clause to bring them within the pool of matrimonial assets for division. In other words, inter-spousal gifts are matrimonial assets as defined in s 112(10) without the need to satisfy any further conditions. An inter-spousal gift, by its very nature, is always acquired by one spouse during a marriage, and thus falls under s 112(10)(b) of the current Act, which encompasses assets which are acquired by one party during the marriage or by both parties during the marriage. Therefore, all inter-spousal gifts fall under s 112(10)(b) and are matrimonial assets without the need to satisfy any further conditions (this is in contrast to s 112(10)(a), which stipulates stricter conditions that have to be satisfied by assets acquired prior to a marriage before they can become matrimonial assets). I add one important qualification at this point, namely, that the discussion of inter-spousal gifts here and in the preceding paragraph applies only to “pure” inter-spousal gifts (ie, inter-spousal gifts where the subject matter of the gifts are not assets acquired by the donor spouse by way of a third-party gift or an inheritance), and not to inter-spousal gifts which take the form of a “re-gift” of an asset acquired by the donor spouse by way of a third-party gift or an inheritance (see below at [52]–[56]).
[42] While the “substantial improvement” exception in the Exclusion Clause is, for the reasons stated above at [40]–[41], inapplicable to “pure” inter-spousal gifts, it is, in my view, eminently suited to be applied vis-à-vis gifts from third parties in order to prevent an unmerited windfall from accruing to the non-recipient spouse. In the case of a gift from a third party to a particular spouse, the non-recipient spouse ought not to be able to avail himself or herself of a share in that gift as that would constitute an unmerited windfall. Besides, such a windfall would not accord with the intention of the third-party donor. Where, however, the non-recipient spouse satisfies the conditions set out in the “substantial improvement” exception by helping – either solely or jointly with the spouse who was the original recipient of the third-party gift – to substantially improve that gift, then the “substantial improvement” exception can be invoked to bring that gift into the pool of matrimonial assets. Such a result would be just and equitable as it would acknowledge and recognise the efforts of the non-recipient spouse in improving the third-party gift. In other words, the “substantial improvement” exception is intended to prevent unmerited windfalls from accruing to the non-recipient spouse in the situation of a third-party gift.
[43] I have arrived at this interpretation of the purpose of the “substantial improvement” exception both from principled reasoning and from the structure of s 112(10). The issue of substantial improvement arises twice in s 112(10), once in the context of the Exclusion Clause, and once in the context of assets acquired before a marriage under s 112(10)(a)(ii). The purpose of the “substantial improvement” exception is the same in both these areas, viz, to prevent an unmerited windfall from accruing to “the other party … to the marriage”. As noted above at [41], s 112(10)(a) stipulates that assets acquired before a marriage need to satisfy either the condition set out in s 112(10)(a)(i) or that set out in s 112(10)(a)(ii) before they can become matrimonial assets. The reason for this is that there is no presumption that assets acquired before a marriage are naturally or ordinarily intended to be part of the pool of matrimonial assets as there was, ex hypothesi, no marriage in existence at the time of the acquisition of those assets (see Chen Siew Hwee v Low Kee Guan (Wong Yong Yee, co-respondent) [2006] 4 SLR(R) 605 (at [44])). Therefore, if the party who did not acquire the asset before the marriage were allowed to avail himself or herself of a share in that asset, this would constitute an unmerited windfall. To guard against such a windfall, s 112(10)(a)(ii) provides (in cases where the condition in s 112(10)(a)(i) is not satisfied) that in order for an asset acquired before a marriage to constitute a matrimonial asset, the spouse who did not acquire the asset before the marriage will have to show that during the marriage, he or she substantially improved the asset either by himself or herself or jointly with the spouse who acquired the asset before the marriage. The wording of s 112(10)(a)(ii) is in pari materia with the “substantial improvement” exception in the Exclusion Clause.
[44] Returning to the Exclusion Clause, I find that while there is a need to prevent an unmerited windfall to the non-recipient spouse in respect of third-party gifts, this concern does not apply to “pure” inter-spousal gifts as the non-recipient spouse in that context is also the donor spouse, who would have expended effort in the original acquisition of the gift. As such, the “substantial improvement” exception would be rendered nugatory in the context of “pure” inter-spousal gifts, which suggests that Parliament cannot have intended the word “gift” in s 112(10) to encompass “pure” inter-spousal gifts.
[45] My interpretation of “gift” in s 112(10) as referring only to third-party gifts and not to “pure” inter-spousal gifts is also buttressed by the reference to an “inheritance” in the Exclusion Clause. I note that an inheritance, by its very nature, originates from a third party. Indeed, the same rationale just discussed (viz, of avoiding unmerited windfalls to the non-recipient spouse) in relation to third-party gifts would apply equally to an inheritance. There are two possible interpretations of why both the words “inheritance” and “gift” were utilised in the Exclusion Clause. Firstly, it could be argued that the reason for including separate references to a “gift” and an “inheritance” in s 112(10) is that Parliament intended to distinguish between the two by according a wider scope to the former as compared to the latter (namely, by including gifts that are not from third parties – ie, inter-spousal gifts – within the ambit of the word “gift”). Whilst this appears to be a persuasive argument at first blush, it does not address the concerns which such an interpretation would engender, as discussed above at [40] and [42]. I therefore favour the second interpretation, namely, that it was necessary to utilise both the word “gift” as well as the word “inheritance” in s 112(10) as each word refers to a different way in which a third party can benefit a particular spouse – an inheritance accrues to the spouse concerned only on the death of the (third-party) donor, whereas a gift generally accrues to the spouse concerned whilst the (third-party) donor is still alive. On this second interpretation, it is wholly consistent to interpret the word “gift” in s 112(10) as referring only to third-party gifts.
[46] Therefore,“pure” inter-spousal gifts will constitute part of the pool of matrimonial assets for division as they are not “gifts” within the scope of s 112(10). Only gifts from third parties are “gifts” for the purposes of the Exclusion Clause in s 112(10) and are, accordingly, excluded from the pool of matrimonial assets (unless the conditions set out in the “substantial improvement” exception are fulfilled).
[47] It remains for me to add that my interpretation of the word “gift” in s 112(10) is not inconsistent with either the Select Committee Report on Bill 5/96 or the parliamentary debates on the same. At para 5.5.6 of the Select Committee Report on Bill 5/96 (reproduced above at [27]), the Select Committee noted that the proposals which it had received regarding the “gifts” to be included in the pool of matrimonial assets were (inter alia):
(a) the inclusion of any gift or inheritance received by a spouse that had been ordinarily used or enjoyed by the family, regardless of whether or not that gift or inheritance had been improved by the other spouse; and
(b) the inclusion of any gift given by one spouse to the other spouse.
[48] It is clear, in my view, that my interpretation of the “gifts” that may be included in the pool of matrimonial assets is narrower than that envisaged in the two proposals. For the reasons given above (in particular, at [42]), I am of the view that an inclusion of gifts on the scale of the two aforesaid proposals would be too wide. Therefore, whilst the Select Committee’s statement that there was “no need to amend the definition in [Bill 5/96] as it [stood]” (see para 5.5.7 of the Select Committee Report on Bill 5/96 (reproduced at [27] above)) was a rejection of these two broad interpretations of “gift”, it does not preclude narrower interpretations of “gift”.
[49] Further, I note that the Law Reform Committee had proposed definitions of both “gift” and “matrimonial home”. The Law Reform Committee had suggested defining “gift” as a gift “other than a gift by one party to the other during the marriage” (ie, as a gift other than an inter-spousal gift), and had suggested defining “matrimonial home” as “a property where the parties to the marriage were ordinarily residing at or immediately prior to the time when the marriage irretrievably broke down”. Neither definition was adopted by the Select Committee. A reasonable inference that can be drawn from the Select Committee’s decision not to include the definition of “matrimonial home” is that there was no need to do so, given that the meaning of “matrimonial home” was clear. Perhaps, the Select Committee also decided against the inclusion of the definition of “gift” as it was clear from the case law prior to the 1997 Amendments that “gift” only included third-party gifts. As noted earlier, the Select Committee might simply have intended the word “gift” to be interpreted in accordance with the existing case law at that time (as set out in, eg, Yeo Gim Tong Michael). In this regard, my interpretation of the word “gift” accords with and affirms the approach taken by this court in Yeo Gim Tong Michael. I also note that the Select Committee Report on Bill 5/96 specifically mentioned (at para 5.5.7) that the reason for excluding gifts and inherited assets which had not been substantially improved by the non-recipient spouse from the definition of “matrimonial asset” was to “[safeguard] the interests of the party who acquired the assets”. This rationale of protecting the party who acquires the assets points in favour of including “pure” inter-spousal gifts in the pool of matrimonial assets as this protects the donor spouse (viz, “the party who acquired the assets” referred to at para 5.5.7 of the Select Committee Report on Bill 5/96).
[50] As for the parliamentary debates on the Select Committee Report on Bill 5/96, while the definition of “matrimonial asset” received scrutiny during those debates, there was no discussion as to the scope of the gifts that were to be included, if at all, in the pool of matrimonial assets. Therefore, my present interpretation of the word “gift” in s 112(10) cannot be said to be inconsistent with the views expressed during the parliamentary debates.
[51] I should point out that since the final draft of this judgment was prepared, the finding that only third-party gifts are “gifts” for the purposes of the Exclusion Clause was also arrived at in the recent Singapore High Court decisions of Tan Cheng Guan v Tan Hwee Lee [2011] 4 SLR 1148 (“Tan Cheng Guan”) and Sigrid Else Roger Marthe Wauters v Lieven Corneel Leo Raymond Van Den Brande [2011] SGHC 237.
[52] However, and crucially for present purposes, while Tan Cheng Guan accepted that the word “gift” in the Exclusion Clause did not cover “pure” inter-spousal gifts, it also drew a further distinction between a “pure” inter-spousal gift on the one hand and an inter-spousal gift where the asset in question was originally acquired by the donor spouse as a third-party gift or an inheritance on the other, with the latter falling outside the pool of matrimonial assets:
[53] This issue is crucial as, in the present appeals, the inter-spousal gift which this court is confronted with consists partly of assets which were originally an inheritance: the Hawick and Kelso shares that the Husband gave to the Wife can be traced to the Husband’s inheritance (see below at [61]). Therefore, the status of an inheritance or a third-party gift acquired by a spouse at any time (whether before or during the marriage) which is subsequently given by that spouse to the other spouse during the marriage arises for consideration. In particular, the issue arises as to whether these gifts (referred to hereafter as “inter-spousal ‘re-gifts’” where appropriate) – ie, inter-spousal gifts of assets acquired by the donor spouse by way of a third-party gift or an inheritance – can be “converted” into inter-spousal gifts which then constitute part of the pool of matrimonial assets for distribution.
[54] The strongest argument in favour of “conversion” is that the “ring-fencing” around a third-party gift or an inheritance is removed when it is subsequently re-gifted as an inter-spousal “re-gift”. Two examples will be used to illustrate this point. Firstly, I will consider the scenario where the spouse who is the original recipient of an asset acquired by way of a third-party gift or an inheritance has “ring-fenced” the asset and the other spouse has not substantially improved that asset during the marriage. It is uncontroversial that in such a situation, pursuant to the Exclusion Clause, the asset would not be a matrimonial asset. Secondly, I will take the scenario where the spouse who is the original recipient of an asset acquired by way of a third-party gift or an inheritance chooses to remove the “ring-fencing” of the asset by re-gifting it as an inter-spousal “re-gift”. In this situation, arguably, the re-gifting expresses the intention that the asset which is the subject of the inter-spousal “re-gift” should become a matrimonial asset.
[55] While I am sympathetic to this argument, I note that there is no statutory basis for such “conversion”. Nothing in s 112(10) provides that the mere expression of an intention to bring non-matrimonial assets into the pool of matrimonial assets suffices to take such assets out of the ambit of the Exclusion Clause. In all likelihood, when s 112(10) was enacted, Parliament probably did not envisage the situation of a third-party gift or an inheritance being subsequently re-gifted as an inter-spousal “re-gift”, thus creating a lacuna. Pursuant to the language of s 112(10), I am of the view that “conversion” of an inter-spousal “re-gift” into a matrimonial asset cannot take place. In other words, although an inter-spousal “re-gift” would appear, literally, to be an inter-spousal gift and, thus, form part of the pool of matrimonial assets based on the reasoning set out at [40]–[41] above, the asset which is the subject matter of an inter-spousal “re-gift” was originally a third-party gift or an inheritance and, thus, no effort would have been expended by the donor spouse (ie, the spouse making the inter-spousal “re-gift”) in “the original acquisition of [the asset concerned]” (see Yeo Gim Tong Michael at [12]). The rationale set out at [40] above for including “pure” inter-spousal gifts in the pool of matrimonial assets for division does not, therefore, apply to inter-spousal “re-gifts”. In my view, only “pure” inter-spousal gifts are intended to be excluded from the word “gift” in the Exclusion Clause. Assets which are acquired by a spouse by way of a third-party gift or an inheritance thus fall outside the pool of matrimonial assets even if they are subsequently re-gifted as an inter-spousal “re-gift”. This is an important qualification to my discussion above (at [40]–[41]) on “pure” inter-spousal gifts.
[56] I would add that the “substantial improvement” exception is, in my view, not applicable to inter-spousal “re-gifts”. This is because where a third-party gift or an inheritance is made the subject of an inter-spousal “re-gift”, the concept of the “other” spouse (a concept integral to the “substantive improvement” exception) takes on an entirely different complexion as compared to situations where a third-party gift or an inheritance is not re-gifted. Where a third-party gift or an inheritance is not re-gifted, the “other” spouse would simply be the non-recipient of the third-party gift or inheritance. However, where there is subsequent inter-spousal re-gifting of a third-party gift or an inheritance, there is a question as to who the “other” spouse is. For example, where a husband receives a third-party gift and then re-gifts it to his wife, would the husband, as the donor spouse, be the “other” spouse as he is the non-recipient of the inter-spousal “re-gift”; or would the wife be the “other” spouse as she was the non-recipient of the third-party gift which formed the subject of the inter-spousal “re-gift”? This boils down to an issue of what the legislative intent of Parliament was in enacting the “substantial improvement” exception. As I have found above that inter-spousal “re-gifts” were probably not envisaged at the time s 112(10) was enacted, this question is one for which no answer is forthcoming. Indeed (and in contrast), the concept of the “other” spouse is (as already noted) unproblematic only in the situation that was envisaged by Parliament when it enacted s 112(10), viz, where a third-party gift or an inheritance is not re-gifted as an inter-spousal “re-gift”. Therefore, I find that the only approach open to me is to hold that the “substantial improvement” exception is intended to apply only to third-party gifts and inherited assets, and not to inter-spousal “re-gifts”.
[57] I recognise that one potential difficulty with my approach is that a spouse who receives an inter-spousal “re-gift” (where the asset concerned, being non-matrimonial in origin, would not form part of the pool of matrimonial assets and would thus belong solely to the donee spouse) may be in a better position than a spouse who receives a “pure” inter-spousal gift (where the asset concerned, being matrimonial in origin, would form part of the pool of matrimonial assets). I am of the view that this difficulty can nevertheless be addressed in the following practical way. In cases of an inter-spousal “re-gift”, the court still has the power to do justice by taking the donee spouse’s non-matrimonial property into account pursuant to s 112(2)(h) read with s 114(1) of the current Act. Section 112(2)(h) of the current Act requires a court ordering a division of matrimonial assets to have regard to, inter alia, “the matters referred to in section 114(1) in so far as they are relevant”. Section 114(1)(a) of the current Act provides that one such factor is:
[58] Hence, the court can have regard to each party’s non-matrimonial property. This allows for flexibility in the division of matrimonial assets. As noted by the Judge (see the Judgment at [44]), where one party has acquired property of considerable value as a result of the divorce proceedings, this may justify that party receiving a smaller share of the matrimonial assets available for division. While I observe that a legislative reconsideration of s 112(10) may be necessary to address the apparent lacuna in respect of inter-spousal “re-gifts”, the court, as just mentioned, can nevertheless rely, in the meantime at least, on s 112(2)(h) read with s 114(1)(a) of the current Act to achieve practical justice.
[59] To summarise, my position with regard to the issue of whether gifts are matrimonial assets is as follows:
(a) Third-party gifts are “gifts” for the purposes of the Exclusion Clause and are thus not included in the pool of matrimonial assets, unless the “substantial improvement” exception is satisfied.
(b) Inter-spousal “re-gifts” are not included in the pool of matrimonial assets, and the “substantial improvement” exception is not applicable to inter-spousal “re-gifts”. Any necessary adjustments to achieve a just and fair result on the facts can be achieved by the application by the court of s 112(2)(h) read with s 114(1)(a) of the current Act.
(c) “Pure” inter-spousal gifts are not “gifts” for the purposes of the Exclusion Clause, and are thus included in the pool of matrimonial assets without the need to satisfy any further conditions.
(d) I wish to emphasise that the matrimonial home, as its name suggests, is included in the pool of matrimonial assets for division, even if it was the subject of a third-party gift or an inheritance. The wording of the Exclusion Clause makes this clear.
Issue 2
[60] Given my finding on Issue 1, Issue 2 does not arise for decision on the facts of the present appeals. Let me explain. As mentioned at sub-para (a) of [12] above, the Judge found that the transfer of the Shares from the Husband to the Wife took the form of a gift (see the Judgment at [18]) and this finding has not been appealed against by the Husband. The gift of the Shares is thus, on the face of it, an inter-spousal gift from the Husband to the Wife. As noted at [8] above, the Shares comprise the Hawick and Kelso shares (which constitute 40% of the shares in Hawick and 40% of the shares in Kelso) and the Skeve shares (which constitute 10% of the shares in Skeve). As will be made clear below, while the gift of the Hawick and Kelso shares on the one hand must be analysed differently from the gift of the Skeve shares on the other, the “substantial improvement” exception is applicable to neither.
[61] With regard to the Hawick and Kelso shares, the main assets held by Hawick and Kelso originate from the Husband’s inheritance. As noted at [6] above, the land on which Hampton Court stands was part of the Husband’s inheritance from his late father. As the main assets of both Hawick and Kelso are units in Hampton Court, the shares in these two companies are traceable to the Husband’s inheritance. The gift of the Hawick and Kelso shares to the Wife is thus, in effect, an inter-spousal “re-gift” of an inheritance, and the “substantial improvement” exception is not applicable to the same (see above at sub-para (b) of [59]). The Hawick and Kelso shares are thus non-matrimonial assets which solely belong to the Wife, and will be taken into account in the division of matrimonial assets under s 112(2)(h) read with s 114(1)(a) of the current Act.
[62] With regard to the Skeve shares, the main asset held by Skeve, viz, the Riverwalk property, was purchased during the marriage, and, unlike the properties held by Hawick and Kelso, is not directly traceable to the Husband’s inheritance. Mr Khoo also did not raise any argument that the Riverwalk property was bought with inheritance moneys. Therefore, I find that the gift of the Skeve shares by the Husband to the Wife is a “pure” inter-spousal gift and thus forms part of the pool of matrimonial assets without the need for any further conditions to be satisfied.
[63] For completeness, I should add that SUM 2864/2011 (see [1] above) was filed by the Husband in connection with Issue 2. In that summons, the Husband, in essence, sought leave to adduce further evidence to show that he had substantially improved the value of the Hawick and Kelso shares for the purposes of the “substantial improvement” exception. As I have just stated, this exception is inapplicable to these shares. I thus make no order on SUM 2864/2011.
Issue 3
Overview
The Husband’s case
[65] Mr Khoo submits that the effect of the aforesaid ruling by the Judge is that while the valuation of the Relevant Properties is to be done as at 14 January 2011 (the date of the Judgment), the liabilities on those properties are fixed as at 31 July 2007. He argues that there ought, instead, to be an ongoing evaluation of both the market value of and the liabilities on the Relevant Properties. Further or in the alternative, Mr Khoo argues that even if the Judge was correct in fixing the liabilities on the Relevant Properties as at 31 July 2007, the subsequent increases in those liabilities were taken for the benefit of both spouses, and a failure to take them into account in ascertaining the NAV of the Relevant Properties would lead to an unjust division. He avers that the Judge was wrong to find (at [36] of the Judgment) that there was “no claim or evidence” before him that the subsequent increases in liabilities were taken for the benefit of both spouses.
The Wife’s case
[66] Ms Yap, on the other hand, argues that the subsequent increases in the liabilities on the Relevant Properties after 31 July 2007 were taken for the Husband’s personal benefit. She therefore argues that the Judge’s determination that those liabilities be fixed as at 31 July 2007 is sound and should be upheld on appeal.
My analysis and decision
[67] As a matter of principle, once divorce proceedings are commenced and the likelihood of the issue of dividing matrimonial assets arises, neither spouse should be allowed to dispose of or incur liabilities on those assets for his or her sole benefit to the detriment of the other spouse. A spouse who does so will be solely liable for the liabilities so incurred. For this reason, I affirm the Judge’s finding (at [36] of the Judgment) that the starting point for the date for determining the liabilities on the Relevant Properties is the date of commencement of the divorce proceedings.
[68] Given that the Judge stated (at [36] of the Judgment) that there was “no claim or evidence” before him that the subsequent increases in the liabilities on the Matrimonial Home after the aforesaid date were taken for the benefit of both spouses, I am entitled to infer that the Judge accepted the Wife’s argument that the Husband had enhanced those liabilities for his sole benefit and was not convinced by the Husband’s evidence to the contrary.
[69] Even so, for the sake of completeness, I now turn to examine the evidence before this court with regard to the overdraft liabilities on the Relevant Properties. Mr Khoo argues that the Husband and the Wife have always lived on overdrafts of considerable magnitude. As evidence thereof, he produced the following table demonstrating the overdraft liabilities on the properties held by Hawick and Kelso as well as on the Matrimonial Home for the years 1995, 2006, 2007 and 2008:
[71] I am unconvinced that the aggregate increases in the overdraft liabilities from 2007 to 2008 were incurred for the benefit of the family, and thus see no reason to depart from the starting point (as stated at [67] above) that the date for determining the liabilities on the Relevant Properties is the date of commencement of the divorce proceedings. Since Mr Khoo made no argument that the date of 31 July 2007, as opposed to 26 July 2007, would prejudice the Husband, I uphold the Judge’s finding that the liabilities on the Relevant Properties are to be determined as at 31 July 2007. In other words, 31 July 2007 is the operative date for determining the NAV of the Relevant Properties.
[72] With this finding in place, I now turn to assess whether the division of matrimonial assets by the Judge was just and equitable, which is Issue 4.
Issue 4
Overview
[73] As noted earlier, the Judge divided the matrimonial assets as follows:
(a) the Matrimonial Home was divided in the proportion 35:65 in favour of the Husband; and
(b) the rest of the matrimonial assets – excluding: (i) the Matrimonial Home, (ii) the remainder of the shares in the Three Companies that were not registered in the Wife’s name, (iii) the boat “Delightful Dream” and (iv) the Renault car given to Daniel as a wedding present – were divided in the proportion 25:75 in favour of the Husband.
As the parties are not appealing against the Judge’s decision on the division of the Matrimonial Home, my references hereafter to “Matrimonial Assets” are to be understood as excluding the Matrimonial Home.
[74] I will first state my findings with regard to the composition of the pool of Matrimonial Assets. In my view, it is necessary to make two important changes to the composition of the pool of Matrimonial Assets. Firstly, as I have decided (see above at [62]) that the inter-spousal gift of the Skeve shares (which comprise 10% of the shares in Skeve) is a “pure” inter-spousal gift and is thus not a “gift” for the purposes of the Exclusion Clause, the Skeve shares will now enter the pool of Matrimonial Assets. This differs from the Judge’s decision to exclude the Skeve shares from the pool of Matrimonial Assets (flowing from his decision on Issue 1 that all gifts were not matrimonial assets for the purposes of s 112(10)). Secondly, the Husband’s 90% shareholding in Skeve will also be included in the pool of Matrimonial Assets, as the main asset held by Skeve was acquired during the marriage and thus satisfies s 112(10)(b) (see above at [62]). In this regard, I respectfully disagree with the Judge that all of the shares in the Three Companies that were registered in the Husband’s name should be excluded from the pool of Matrimonial Assets. Of the shares in Hawick, Kelso and Skeve that were registered in the Husband’s name (ie, the shares in the Three Companies which he did not give to the Wife), I find that only those shares in Hawick and Kelso that were registered in the Husband’s name (which amount to 60% of the shares in each of these companies) should be excluded from the pool of Matrimonial Assets. This is because the main assets held by Hawick and Kelso (viz, #02-01 and #03-02, respectively, of Hampton Court) are traceable to the Husband’s inheritance (see above at [61]).
[75] I should add that while I have come to the same conclusion as the Judge that the Hawick and Kelso shares are excluded from the pool of Matrimonial Assets, I have done so for quite different reasons. The Judge was of the view that all gifts were excluded from the definition of “matrimonial asset” pursuant to the Exclusion Clause and that the Husband had not satisfied the “substantial improvement” exception. In contrast, I have found that the Hawick and Kelso shares constitute an inter-spousal “re-gift” of an inheritance and are thus non-matrimonial assets. I have further found that the “substantial improvement” exception is not applicable to the Hawick and Kelso shares.
The Wife’s case
[77] In the alternative, Ms Yap argues that there ought to be one more amendment to the pool of Matrimonial Assets. She submits that contrary to the Exclusion Clause (which expressly excludes inherited assets from the definition of “matrimonial asset”), the Judge included the Wife’s inherited moneys (amounting to $373,000) in the pool of Matrimonial Assets when this sum should have been excluded. Ms Yap argues that this sum of money was deposited into the Wife’s bank accounts, and still remains intact. She thus argues that the said sum should be excluded from the pool of Matrimonial Assets.
The Husband’s case
[79] In response to Ms Yap’s alternative argument based on the Wife’s inherited moneys (see [77] above), Mr Khoo notes that prior to the present appeals, the Wife did not seek to exempt her inherited moneys from the pool of Matrimonial Assets, and argues that it would be inequitable for her to now backtrack and present an entirely different case on appeal as far as the inherited moneys are concerned. Further or in the alternative, Mr Khoo submits that even if the Wife’s inherited moneys are to be excluded from the pool of Matrimonial Assets, the “first in, first out” rule should apply to those moneys and the court should find that the same have already been expended. He thus argues that the sum of $373,000 should not be deducted from the pool of Matrimonial Assets.
My analysis and decision
[80] It is well established that in dividing matrimonial assets, the court will take a broad-brush approach. In Yeo Chong Lin, this court opined that the division of matrimonial assets is “all about feel and the court’s sense of justice” (at [81]). As it involves an exercise of discretion, an appellate court should not be too quick to interfere with the division ordered by a lower court. In order for an appellate court to disturb the division ordered by a lower court, it must be shown that the judge in the lower court “erred in law or … clearly exercised [his or] her discretion wrongly or … [took] into account irrelevant considerations or … failed to take into account relevant considerations” (see Yeo Chong Lin at [80]). In the present case, as my findings have altered the composition of the pool of Matrimonial Assets in two respects (as set out above at [74]), the factual matrix before me is now different from that which was before the Judge. I will thus consider the division of Matrimonial Assets afresh.
[81] Although it is known what is excluded from the pool of Matrimonial Assets, this court is still faced with an undetermined pool of assets as there are undisclosed assets. As for the disclosed assets, there is deep disagreement between the Husband and the Wife as to the value of many of the assets. This is not an uncommon feature of matrimonial cases, and the law on the division of matrimonial assets exists precisely to deal with situations where the spouses are unable to come to an agreement as to the value of the assets concerned. Notwithstanding such difficulties, the court must endeavour to arrive at a just and equitable division of the assets concerned.
[82] The first step in the division of matrimonial assets is to try, as best as possible, to ascertain what the pool of assets consists of, and I will thus first consider Ms Yap’s alternative argument based on the Wife’s inherited moneys. I agree with Mr Khoo that this is a new point which is sought to be introduced on appeal. Whilst this court has a discretion under O 57 r 9A(4)(b) of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) to allow a new point to be argued on appeal, I am of the view that this discretion should not be exercised in favour of the Wife. The Wife mentioned the inherited moneys as early as 2008 in her Affidavit of Assets and Means filed on 28 October 2008 (specifically, at para 11.b thereof), but failed to raise the argument that these moneys should be excluded from the pool of Matrimonial Assets until the present appeals. In the light of this, there is no need for me to go on to consider Mr Khoo’s argument based on the “first in, first out” rule (see [79] above).
[84] Section 112(2)(h) and s 114(1)(a) of the current Act, read together, permit the court to have regard to the property of the Wife in determining her share of the Matrimonial Assets. While the Wife is no longer awarded 100% of the Skeve shares, she nonetheless has the Hawick and Kelso shares (which consist of 40% of the shares in Hawick and 40% of the shares in Kelso) as part of her personal property, making her an effective part-owner of the two units of Hampton Court owned by Hawick and Kelso respectively. It also should not be forgotten that while the Wife has had to surrender her 10% shareholding in Skeve to the pool of Matrimonial Assets, the Husband has had to surrender his 90% shareholding in Skeve to that pool. All things considered, I find it just and equitable that the Wife should be awarded 25% of the Matrimonial Assets as delineated by me at [74] above. In the circumstances, I reject Mr Khoo’s argument (see [78] above) that the Wife should receive only 20% of the Matrimonial Assets.
Issue 5
Overview
[85] I come now to Issue 5, the final issue in the present appeals – viz, whether a lump sum maintenance should have been awarded in the court below instead of monthly maintenance, and, if so, what the lump sum should be.
The Wife’s case
[86] Ms Yap contends that a lump sum maintenance would allow the Husband and the Wife to obtain a clean break from each other. She argues that the Wife should be awarded a minimum sum of $256,128, derived from a multiplicand of $2,668 and a multiplier of eight years. Ms Yap derives the figure of $2,668 from Mr Khoo’s submissions before the court below on monthly maintenance, arguing that the multiplicand for the purposes of the present appeals should be no lower than that which the Husband was willing to provide in the court below. As for the multiplier, Ms Yap points out that since the average life expectancy of women in Singapore now stands at 85 years, a multiplier of eight years already represents a discount from 19 years (the Wife is now 66 years old). Ms Yap further argues that there is no question that the Husband is able to pay a lump sum maintenance.
The Husband’s case
[87] On behalf of the Husband, Mr Khoo resists a lump sum order. He submits that a lump sum award would be too harsh on the Husband, given that the Husband is in debt. Although the Husband is currently still working, Mr Khoo opines that this might be the “home stretch” for the Husband, given that he is (like the Wife) already 66 years old. Mr Khoo submits, in the alternative, that if this court is minded to make a lump sum award, the multiplicand should be no higher than the sum of $2,000 ordered by the Judge as monthly maintenance, and the multiplier should be three years at the most. This works out to a maximum sum of $72,000. Mr Khoo relies on the decision of this court in Ong Chen Leng v Tan Sau Poo [1993] 2 SLR(R) 545 (“Ong Chen Leng”) as a precedent for his method of calculating the multiplier. He also disputes Ms Yap’s submission that the current average life expectancy of women in Singapore is 85 years.
My analysis and decision
[88] I find that a lump sum order is appropriate for the following reasons. Pursuant to s 115(1) of the current Act, a maintenance order “may provide for the payment of a lump sum or such periodical payment as the court may determine”. In Lee Puey Hwa v Tay Cheow Seng [1991] 2 SLR(R) 196 (“Lee Puey Hwa”), this court noted that compared to periodical payments, a lump sum order had the advantage of allowing for a clean break between the parties, and opined that a lump sum should thus be ordered where possible. I note the desirability of avoiding further litigation and acrimony between the parties, and will therefore exercise the court’s power under s 115(1) to order a lump sum payment. In arriving at my decision, I have been guided by the following principles laid down in Lee Puey Hwa (at [9]):
It can be seen from the above extract that despite the advantages offered by a lump sum payment, the court will not make such an order if the husband is unable to make the payment, or if doing so would effectively cripple his earning power. While the facts in the present appeals disclose that the Husband has fairly substantial outstanding debts, it is submitted by Ms Yap that the Husband should not have difficulty making a lump sum payment of a reasonable figure. This begs the question of what a reasonable lump sum is.
[89] In Ong Chen Leng, this court accepted (at [35]) that the method of quantifying an appropriate multiplier for a lump sum maintenance award should be:

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Wan Lai Cheng v Quek Seow Kee and another appeal and another matter

Laws this judgment relies on

Grounds of decision

Introduction

Facts

Parties to the dispute

Background to the dispute

The decision below

Issues on appeal

My decision

Issue 1

Overview

The Husband’s case

The Wife’s case

The definition of “matrimonial asset”

The legislative history and context of s 112(10)

(1) The law prior to the 1997 Amendments

(2) The 1997 Amendments

My analysis and decision

Issue 2

Issue 3

Overview

The Husband’s case

The Wife’s case

My analysis and decision

Issue 4

Overview

The Wife’s case

The Husband’s case

My analysis and decision

Issue 5

Overview

The Wife’s case

The Husband’s case

My analysis and decision