• Sun
  • Apr 20, 2014
  • Updated: 4:32am
NewsHong Kong
COURTS

Court slashes record divorce payout for property scion’s ex-wife

PUBLISHED : Friday, 10 January, 2014, 4:35pm
UPDATED : Saturday, 11 January, 2014, 4:37am

The Court of Appeal yesterday slashed by two-thirds a record HK$1.4 billion divorce settlement granted to a property tycoon's ex-wife, ruling she should receive HK$411 million. The ruling followed a successful appeal by the husband and his billionaire father.

It said that Florence Tsang Chiu-wing, 39, a solicitor, needs HK$524.5 million to fund the lifestyle she enjoyed during her marriage with Samathur Li Kin-kan, 40. Li is the son of Samuel Tak Lee, the head of Prudential Enterprise, which has vast global real estate investments and owns the Prudential Hotel in Nathan Road, Jordan.

The panel of three judges ruled the lower court was wrong to have included the son's multibillion-dollar property business in Japan, which was developed with seed funds from the father, who has the right to buy back the business at US$1.

The lower court had wrongly granted Tsang HK$1.4 billion on a "sharing principle", giving her 20 per cent of the couple's total assets, which included Li's HK$7.3 billion, the judges found.

The case attracted extensive media coverage during the hearings in 2011 and gave the public a rare glimpse into the extravagance of the seriously rich. The court heard how Li lavished more than HK$100 million a year on himself and at one point had a Boeing business jet, two yachts, 28 cars and millions of dollars' worth of wine.

The couple's eight-year marriage broke down in 2008 after Tsang refused her husband's demand for an abortion, then discovered he was having an affair.

The HK$524.5 million the lower court adjudged that Tsang needed included HK$250 million for a property in Hong Kong, HK$30 million for a property in London, HK$2.5 million to buy two cars in Hong Kong and another HK$1 million for a car in London.

The court also allowed HK$5 million to buy a yacht and HK$4.6 million to enable Tsang to join clubs in Hong Kong and England.

The appeal court said that as the wife had her own assets, the ex-husband would only need to give her HK$411 million.

Deducting the HK$202.8 million that he had already paid her, Li now needed to pay her a further HK$208 million, the court said.

The appeal court also reversed a finding by the trial judge, Mr Justice John Saunders, that Li and his father had committed forgery, perjury and conspiracy. Saunders used the civil rather than the criminal standard of proof to find that it was more likely than not that the two had committed the misconduct.

They were said to have forged a loan agreement to transfer virtually all of the son's assets to the father to frustrate Tsang's claim.

But the Court of Appeal would not set aside Saunders' referral of the case to the Director of Public Prosecutions to decide whether a criminal investigation should be conducted.

"In referring the matter to the DPP, the court is not ordering him to act or expecting him to act in any particular way," the court said, adding that the referral was no different from one made by an ordinary citizen.

"Whether they were guilty of such misconduct is not a question this court should attempt to answer in this judgment," the judges wrote.

The substantial reduction in the award was the result of the appeal court's ruling that the son's Japanese business, which includes 13 buildings in Tokyo, should be excluded from the calculation.

Much of Li's wealth was tied up in property in Japan, including shops rented by brands such as Prada, Audi, H&M and Zara.

The court had heard that the father gave his son a gift of US$47.3 million as seed funds to develop the Japanese business and that there is an agreement between the two that the father would have the right to buy back shares of the business at a nominal price.

The judges said the lower court had failed to take account the father's right to buy back the shares.

 

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