CLC v CLB

Facts

CLC (the Wife) and CLB (the Husband) married in September 2003 and an interim judgment of divorce was granted in July 2019. The Husband had received gifts from his late father and inherited sums from his father's estate, totalling S$5,024,886.35 (the Inheritance Monies), including money from an Australian will, proceeds of a company liquidation and payments from shares in a Malaysian company. Much of the share money was paid into a joint UOB account with the Wife, where a substantial sum stayed until the marriage broke down in 2018, when he moved funds into accounts in his sole name.

In the division of matrimonial assets, the dispute centred on six Australian bank accounts and investment portfolios in the Husband's sole name (the Disputed Assets), worth S$3,801,862.53, and an ANZ account. The Husband said they derived from the Inheritance Monies and should be excluded from the pool under s 112(10) of the Women's Charter. The High Court judge included them, finding the funds co-mingled and no longer separately identifiable. The Appellate Division of the High Court reversed this, holding that co-mingling did not change their character and that, on the numbers, the Inheritance Monies must have gone into those accounts. The Wife obtained leave to appeal to the Court of Appeal in Civil Appeal No 5 of 2022 on two questions of law.

Issues

1. Whether, under s 112(10) of the Women's Charter, the donee spouse's intention can cause an asset acquired by gift or inheritance to lose that character and become a matrimonial asset.
2. What is required to trace an asset, especially money in a bank account, to a gift or inheritance, and who bears the burden of proof.
3. Whether the Disputed Assets and the ANZ account should be included in the matrimonial pool.

Holding

The Court of Appeal allowed the Wife's appeal. It included the Disputed Assets and the ANZ account in the matrimonial pool, excluding only the children's share of S$66,346.71 of the Australian inheritance, and ordered the pool of S$12,670,096.88 to be divided equally. The Husband was ordered to pay the Wife costs of S$50,000 inclusive of disbursements.

Reasoning

Section 112(10) is silent on the donee spouse's intention, but it does not stop the court from giving effect to it under ordinary property law. A spouse may deal with a non-matrimonial asset as he or she wishes, including by giving it to the other spouse or bringing it into the family estate. Because of the consequences, such an intention must be clear and unequivocal. The court disagreed with reading earlier cases as making spouses' intentions irrelevant, and left the treatment of some inter-spousal gifts in Wan Lai Cheng for a future case.

On tracing, the spouse claiming an exclusion must prove the link to the gift on a balance of probabilities; the evidential burden does not shift to the other spouse once the gift is shown to have been received. The test remains whether the true nature of the gift remains intact. Each link must be shown, though reasonable inferences may be drawn; co-mingling does not itself change an asset's character but makes tracing harder, and a dissipated gift can no longer be traced.

Applying this, the court agreed with the Appellate Division that the Disputed Assets were more likely than not derived from the Inheritance Monies, a point the Wife's counsel did not really contest. But the Husband had clearly treated them as family wealth. His emails and messages listed them as part of "our net worth" and the couple's total wealth. Placing money in a joint account that either spouse could operate raised a rebuttable presumption of an intention to share, which his explanation about providing for the family did not rebut. He also used the funds for family expenses and property purchases. With the assets included, the direct and indirect contribution ratios produced an overall ratio of 50:50.

From the judgment