CYH v CYI [2023] SGHCF 4

Outcome: Orders Made.

Facts

1           Parties were married for 7 years and have two children aged nine and seven. The Wife appealed against the decision on the division of matrimonial assets and maintenance. This appeal has since been withdrawn.

Court’s Decision:

2           It is only fair and equitable that a party is ordered to purchase the other party’s share at a valuation based on the open market price ascertained as at or as close as possible to the date of the ancillary hearing when the order to purchase is made. Ordering a party to buy the other party’s share based on a valuation as at an IJ date, that may be several months or even a few years prior to the date of the ancillary hearing cannot be fair to either the buying or the selling party because the historical market price at the date of the IJ will no longer be relevant or appropriate due to price fluctuations with the passage of time.: at [28].

3           Where both parties have a share in a jointly owned non-cash matrimonial asset, both parties bear the risk of a falling market and jointly reap the windfall from a rising market until the ancillary orders for division are made. However, after the court has made the ancillary orders, the gain from any subsequent rise or the loss from any subsequent fall in the price of that asset will necessarily be a matter of concern only for the buying party. The selling party, having relinquished his share in the asset, will have nothing more to do with it. Essentially, the risk of price fluctuations passes from the seller to the buyer of the other’s share in the matrimonial asset once the ancillary order is made.: at [29].

4           Where the non-cash matrimonial asset is not jointly owned but is in the sole name of one party, the party holding the non-cash matrimonial asset in his sole name is akin to being a quasi-trustee (and hence may be treated as having quasi-fiduciary duties) in relation to the other party’s share in that non-cash matrimonial asset prior to the division of matrimonial assets. He needs to act in good faith and preserve that non-cash matrimonial asset in his sole name from the time of the IJ to the time of the ancillary hearing so that it is available for distribution as ordered. Unless it is a perishable non-cash asset (where either party can in the interim apply to the court to sell the perishable asset first to preserve its monetary value), a party having sole title should not unilaterally deal with a non-perishable non-cash matrimonial asset after the date of the IJ by selling it and converting it to cash (and perhaps even re-investing or using up the cash proceeds) whilst waiting for the ancillary hearing to take place.: at [30].

5           If one party having sole title decides unilaterally to sell or dispose of a non-cash matrimonial asset between the IJ and ancillary hearing, he will take the risk of any fluctuation in fair open market value between the sale and ancillary hearing date. He will have to account to the other party for the difference where the asset has appreciated in value after the unilateral sale. The other party will have the higher of either the actual sale price or the open market valuation price ascertained as at or as close as possible to the ancillary order date.: at [33].

6           The court adopted a practical and easy solution of a distribution in kind for all the shares in the various private limited companies, whose current valuations remained unknown and undetermined. The respective parties would thereafter be able to keep or dispose the shares as they deemed fit after the distribution of matrimonial assets in kind.: at [60].

The full text of the decision can be found here.

This summary is provided to assist the public to have a better understanding of the Court’s judgment. It is not intended to be a substitute for the reasons of the Court. All numbers in bold font and square brackets refer to the corresponding paragraph numbers in the Court’s judgment.