Hong Kong Divorce: A Day In The Life – Lauren Ng, Family Law Trainee

Category Archives: Experts

Hong Kong Divorce: A Day In The Life – Lauren Ng, Family Law Trainee

In this series, we follow along individuals who are paving a path in the Family Law community in Hong Kong.

Today, we are speaking with Lauren Ng, family law trainee at Oldham, Li & Nie. In this article, we delve into Lauren’s foray into the Family Law arena and what it takes to survive in what is a very personal, human-focused area of law.

Lauren, tell the Hong Kong Divorce community how you started out in your career. Where did you study and what did you study in order to get to be a “trainee” in the legal field?

I did my Bachelor of Laws degree at the Bristol University in UK. I then did my Postgraduate Certificate in Laws at Hong Kong University which is a programme all prospective lawyers have to take in order to qualify in Hong Kong.

Did you always know you wanted to be a lawyer?

When I was young I actually wanted to be a zoologist or do something related to animals but I quickly realized that this was not a feasible career in Hong Kong. It was only in secondary school when I started thinking about university that I began considering law as a career option.

What made you decide you wanted to create a path for yourself in family law in particular?

While I was at Bristol University, I took the Family Law elective and the International Child Law elective which was taught very passionately by Professor Judith Mason and this really got me interested in this area of the law.

As a trainee, can you tell me what a typical day looks like and the type of work that keeps you busy each day?

A typical day for me would involve drafting various documents such as letters to the opposing side or affidavits. I would also attend client meetings with a partner where my main role would be to take notes and draft follow up emails to the client.

As of the publication of this article, you are now titled “paralegal” – Can you tell us the progression of the trainee contract, how long it lasts for and the steps after that in order to become an associate solicitor?

All trainees have to complete a 2 year training contract before they can apply to be admitted in Hong Kong to become an associate solicitor. I am currently a paralegal as I am in the interim period where I have just completed my training contract but am waiting to be admitted.

What difference/contribution do you hope to make in the family law community in Hong Kong?

Divorce is always a difficult process and I hope that I am able to contribute by helping our clients to the best of my ability and to achieve the best possible outcome for them.

Do you have any advice for other aspiring family law solicitor hopefuls?

Just to always be open to the opportunities out there and be willing to put in the hard work!

 

Thank you again for taking the time to speak with me Lauren.  We wish you all the best of luck in your future and we know you’ll make a wonderful mark in the family law community in Hong Kong!

Clean Break In Divorce

When you divorce in Hong Kong, the term “clean break” may be floated around when discussing ancillary relief or financial provision (or more commonly known as “maintenance” in USA jurisdictions).  So what is a clean break in a divorce? Clean Break simply refers to the distribution of property and/or payment of a lump sum to settle all financial matters, allowing the parties to move forward with a fresh start and without having to be reminded of the breakdown of the marriage by being tied to ongoing payments.

Under section 7 of the Matrimonial Proceedings and Property Ordinance (Cap. 192), the courts in Hong Kong are under a duty “to have regard to the conduct of the parties and all the circumstances of the case” including the following matters:

  • The income, earning capacity, property and other financial resources…;
  • The financial needs, obligations and responsibilities…of the parties…;
  • The standard of living enjoyed by the family before the breakdown of the marriage;
  • The age of each party to the marriage and the duration of the marriage;
  • Any physical or mental disability of either of the parties to the marriage;
  • The contributions made by each of the parties to the welfare of the family…’
  • …the value to either of the parties to the marriage of any benefit (for example, a pension) which, by reason of the dissolution…of the marriage, that party will lose the chance of acquiring.

In Hong Kong, the courts are not under any duty to consider whether a clean break is appropriate or not but it may be considered.  Generally speaking, a clean break is only an option when there is sufficient monies in a matrimonial pot which would allow the parties to move forward after the payment of one lump sum payment/distribution of property which would settle all financial claims.

In one such case, C v F [2008] HKFLR 1, the parties had a long-term marriage which began in 1965 and a Petition for divorce was filed by the Husband in February 2000.  Throughout the marriage, the Husband’s business had grown to the extent that he valued his assets at approximately HK$36 million with an income of approximately HK$800,000 per month.  The Husband alleged he had considerable debts as he was heavily indebted to the company and to his business partner.  The court ordered a transfer of the former matrimonial home, mortgage free, to the wife and a clean break lump sum to her of HK$15 million.

In YN v NA [2014] HKFLR 517, the court stated that “in big money cases, where the matrimonial assets are sufficient for a clean break to be achieved, a wife with ordinary career prospects is likely to have been compensated by an equal division of the assets and consideration of how the wife’s career might have progressed is unnecessary and should be avoided.”

It should be noted that once a clean break is achieved, a party cannot come back to the court and make an application for maintenance.  This in itself is the benefit and advantage with respect to a clean break: it allows the parties to move on with their lives, without being tied to each other by having to make monthly payments to one party and allows each party to live independently without any burdens of the past.

If you are going through a divorce, speak to your solicitor about a clean break and whether it’s the right option for you.  If there is a possibility of self-sufficiency, a clean break should be considered an option.  If you are concerned about an immediate clean break, discuss alternative options such as a deferred clean break or even consider nominal maintenance which would then allow you an open door to make an application for periodical payments in the future if need be, but at the same time lift the financial burden on the paying party at the current moment.

Mental Health and Divorce

It is not uncommon for many individuals to equate divorce to a death in the family.  A plethora of emotions are not uncommon and can range from feelings of freedom, happiness, remorse, sadness and guilt along with a dash of bitterness, resentment and frustration.  A divorce becomes exceptionally difficult when individuals are engaged in long, drawn-out court battles on key issues such as children, assets and ancillary relief.

In this article, we focus on the importance of enlisting the help of mental health professionals when you are going through a divorce.  It is a key way to help you heal and move forward in your life.  Mental health professionals can help you process the range of emotions you may experience during the divorce process and provide you with helpful tools to resolve issues you may be dealing with in this divorce journey.

In a time when mental health awareness is being highlighted in media and self-care is becoming a priority, there should be no shame in seeking help when it is needed to get you to a better place emotionally and spiritually.

  1. Types of Mental Health Professionals:  Before we dive into the benefits of enlisting the assistance of mental health professionals in divorce, let’s look at the types of mental health experts available to you in divorce. One mental health expert may be a therapist/psychologist. A therapist/psychologist can assist you in managing the stresses of divorce, including your expectations of the outcome. A therapist/psychologist can also help you develop new interpersonal skills that are valuable in creating healthier relationships whether it be with your spouse or your children during and after the divorce process. The interpersonal skills and tools you may learn through therapy is especially helpful if you have children and there is a need to co-parent with your ex-spouse.  If you do not have the means to hire a therapist/psychologist, there are many mental health services available such as St. John’s Cathedral Counselling Service or The Samaritans in Hong Kong which can provide emotional support and counseling services for those in distress free of charge.  Another mental health professional you may consider is a mediator who can assist you and your spouse negotiate a mutual agreement with respect to custody and access.   This is an ideal option if you and your spouse are on amicable terms and you both believe a compromise is feasible through open dialogue and communication.  To enlist a mediator to assist in custody and access issues is beneficial especially if you and your spouse agree that you do not wish to involve the court in resolving your custody and access issues.   Another option is a parenting coordinator, who can assist you and your spouse resolve minor issues such as holiday pickup arrangements and communication disputes.
  2. Benefits Of Hiring A Mental Health Professional In Divorce:  What are the benefits in hiring a mental health professional? Calming emotions, clarifying expectations and helping discuss difficult issues are just some of the essential benefits obtained through the assistance of a mental health professional. Before deciding on a mental health professional, do your due diligence and conduct your own research before you entrust the personal details of your life to a professional. Your solicitor can be a helpful resource in providing you with a list of reputable and highly trained experts in the very area in which you seek assistance. There are many healthcare professionals in Hong Kong who have dealt with divorcing couples and can provide you and your family with helpful tools on how to navigate these difficult waters.
  3. When Should A Mental Health Professional Be Employed In Your Divorce?  Deciding on whether to enlist the help of a mental health professional is a personal decision. Consider therapy if you believe it can offer support and assistance in your own personal growth journey. Consider therapy if you are struggling with mental illness, which may be triggered or exacerbated by the circumstances surrounding your divorce. Talk to your solicitor to determine if a mediator is needed to resolve disputed children’s issues in your divorce. Your solicitor may have insight as to whether these third-party experts will be helpful to your case. You and your spouse may even consider enlisting the help of these trained mental health professionals for your children, especially if they are struggling with the “new normal” of the family dynamics.  However, when doing so, make sure that the children are amenable to the idea as it truly is up to a child on whether he or she wants to attend therapy.  Respect your child’s privacy if he or she chooses to attend therapy to resolve issues related to the divorce and remember not to use it as a weapon against the other spouse in your divorce.
  4. Consider Other Forms Of Mental Health Support: Finally, mental health support does not need to be limited to therapy. Consider mediation, yoga or other forms of physical exercise to boost your mood, mind, confidence and self-esteem. A healthy lifestyle, hobbies, journal practice and gratitude and appreciation lists are also helpful ways to boost your mood and confidence.  Change is difficult to adapt to, but be hopeful in that change is good and there are better things ahead.

Your solicitor is available to support you through the divorce process and can provide you not only with legal assistance but emotional support as well.  Do not be afraid to ask for help when you need it.  There is no shame in asking for help to bring your mental state to a better place.

Cross Border Views on Inherited Wealth

This article looks at how inherited funds are treated from a cross-border perspective. To the surprise of many, inherited wealth in a divorce may be treated differently depending on the jurisdiction in which you file for divorce. Location is therefore an important factor to consider when divorcing. To unpack this topic, let’s explore and contrast how inherited wealth is treated in Hong Kong vs. the United States of America, in particular the community property state California.

1. Inheritance in Divorce in California: California, like many other states, is a community property state. This means that in a divorce, all property acquired during the marriage is divided equally between the divorcing parties. An exception to this rule occurs when an individual receives an inheritance during the course of the marriage. In those circumstances, under California law, an inheritance is separate property and therefore will be excluded from the division of assets and debts in a family estate (Family Code Section 770).

It is important to note that when an individual receives an inheritance, the monies received must be traceable to the source so there is no confusion as to whether the money is separate property or community property. That is why it is always a good idea to open a separate bank account and deposit inheritance monies into this separate account to identify them and keep them separate. Otherwise, by depositing inheritance funds in a joint community bank account, you are commingling funds. When monies become commingled, it can become very difficult to trace monies back to the separate property source and your former spouse may have an argument that all inherited funds were already spent during the marriage and therefore all remaining funds in the joint account are community property and must be split equally. When in doubt, always keep clean records of any inherited funds and keep records of how these monies have been spent. If you don’t keep track, a tracing expert may be enlisted but tracing can become quite expensive and time-consuming thereby stalling the divorce.

2. Gifts Are Separate Property in Divorce in California: Another exception occurs when an individual receives a gift. For example, if you receive a beautiful piece of jewelry from your spouse for an anniversary or birthday, this gift is generally excluded from the division of assets and debts in a family estate. If, however, the gift could be considered of substantial value, the courts will then look at the asset more carefully and it may be subject to division taking into account the parties’ wealth and finances.

If the asset is determined to be of substantial value, it is community property and must be divided between the parties – unless of course, either party can present a written transmutation agreement changing the character of this asset from community to separate.

3. Inherited Wealth in Divorce in Hong Kong: Over the years, there has been much debate over how inherited funds should be treated in a divorce in Hong Kong and whether these funds should be excluded from division. In Hong Kong, inherited wealth are those assets that come from a source wholly external to a marriage. Like Great Britain, the courts in Hong Kong have regard to the “yardstick of equality” as a starting point, meaning the goal is to divide the asset pool fairly. Courts in Hong Kong may however, veer from this principle and make adjustments, thereby dividing assets “unequally” if after reviewing certain statutory factors, taking into account the whole of the asset pool, reasonable needs, compensation and applying the “sharing principle” if assets exceeds the needs, in addition to the specific circumstances surrounding the divorce, and finds that an individual’s inheritance could be a resource to fulfill and satisfy an individual’s reasonable needs and the needs of the children post-divorce (See the Hong Kong landmark case titled DD v LKW (2010) 13 HKCFAR 537.) As a result, the Court may heed to flexibility in order to find a suitable answer to the circumstances of each case whereby the objective is to reach a just result that is fair for both parties. Thus, unlike California, inheritance funds received by an individual in Hong Kong may be taken into account because it forms part of the asset pool that is a financial resource to one or both of the parties. Stephen J. Peaker, head of the Family Law Department at Oldham, Li & Nie (OLN) and a fellow of the International Academy of Family Lawyers (IAFL) says: “The issue of inherited wealth is becoming more and more prevalent in Hong Kong, both in contested and uncontested cases. The economic success of Hong Kong and the natural passage of time combined have created substantial inherited wealth. One of the key areas of dispute on succession is in relation to family businesses, often with enormous value where one party inherits a business interest. This business can be valued as part of an asset pool and unsurprisingly, this is viewed by the creators of the wealth as inherently unreasonable and has led to the proliferation of generational trusts and the increase in prenuptial agreements.”

It is interesting to note that in Hong Kong, the Court may consider an inheritance even if it has not yet been received, but provided an individual is set to receive an inheritance in the near future or has a perceived resource. Additionally, if you’re involved in a short-term marriage and there are inheritance funds in the asset pool, the courts may not consider the inheritance in the asset division yet if it is a long-term marriage, the courts may include inherited funds, unless these funds were kept entirely separate.

It is important to understand and become knowledgeable of the specific laws of your jurisdiction. Speak with a professional about how to protect your inheritance and what can be done to avoid any issues when dividing assets in your divorce. If you’re getting married, you may want to speak with a family law professional to discuss a prenuptial agreement and ways to avoid any issues in the event of a divorce. Being well prepared will help avoid any heartache in the future!

Calling In Experts For A Divorce

Who Are The Experts?

Experts are individuals with education, experience and knowledge in a specialised area. They may be called upon when there is an issue in a divorce that the Court needs specialist input on. The Court will consider the expert’s advice and/or opinion when deciding an issue.

What Types Of Experts Are There?

There are many types of experts in a divorce. Here are some of the most common types:-

  1. Psychologists:  Psychologists are regularly called upon for children matters. They will analyse the situation and interview the parties involved before providing a professional opinion on the effect of divorce on the children to the Court. The psychologist will then recommend a child custody and visitation plan based on their analysis.
  2. Vocational Expert:  Vocational Experts are usually engaged in cases where one of the spouses has not worked for a long time as they might have given up their career to look after the family. There may therefore be a need to assess his or her current and future earning ability for the calculation of child and spousal support. A vocational expert will evaluate a spouse’s education and skills to determine their earning capability.
  3. Forensic Accountants and Financial Experts:  Forensic accountants are experts in discovering a spouse’s hidden assets and/or hidden sources of income. For example, if one spouse own a business, a financial expert could help in assessing and providing the Court with a more accurate value of the business. Such information helps to build an objective financial picture of the spouses’ assets for division and for the calculation of child support and spousal maintenance.
  4. Real Estate and Antique Experts:  Real Estate experts have the knowledge and skills to calculate the true market value of property. In divorce cases where high value assets are involved, antique experts may be retained to value certain items or collections. Again, this provides the Court with a more accurate financial picture of the spouses to consider when deciding on the question of asset division, or the calculation of child support or spousal maintenance.

While experts may be beneficial to your case, it is important to note that they may be costly and you may have to bear the costs by yourself. You should therefore discuss the need for an expert with your lawyer to see whether the benefits of hiring an expert outweigh the costs of the service that they provide.