Businessman chooses jail over paying ex-wife $7 million
Businessman refuses to pay ex-wife $7m worth of share of assets and maintenance. Appeal judges say...
A businessman worth at least $14 million would rather go to jail than pay his ex-wife some $7 million as her share of their matrimonial assets and maintenance.
Zheng Zhuan Yao, 53, was jailed eight months last October for contempt of court after defying several court orders to award his former wife a 35-per cent share in assets after their divorce.
In a written judgment released last Thursday, the Court of Appeal - comprising Chief Justice Sundaresh Menon, Judge of Appeal Andrew Phang and Justice Steven Chong - said that Zheng had concealed his assets and embarked on a course of "wilful defiance" of several judgments and court orders.
Zheng, formerly known as Tay Chuan Yao, is the son of Indonesian tycoon Tay Jui Chuan, also known as Tay Juhana, whose Sambu Group makes coconut products.
Zheng and his ex-wife, Madam Mok Kah Hong, both Singaporeans, were married in 1983 and have a son who is now in his 20s.
Zheng also has a mistress of 27 years and has two children with her.
In 2008, after 25 years of marriage, Zheng wrote to his wife to suggest a divorce because their relationship had broken down.
This was followed by another letter a year later, saying he planned to start divorce proceedings which were eventually filed in February 2010.
But about a month before he started the divorce proceedings, Zheng mortgaged the family home in Stevens Court, where the family had lived since 1994. Madam Mok, a housewife, had no idea of this.
Over the next few months, he transferred shares in various companies to his relatives, including his father, brother and aunt. This emerged during the divorce hearings.
Throughout the divorce proceedings, Zheng often said he could not remember details because they were from long ago and claimed his memory had been impaired by a stroke in April 2010 - a behaviour which the judge called "quite appalling".
"Every now and then, in parrying counsel's questions, he showed he was not as mentally handicapped as he claimed," the divorce judge wrote, adding that there was evidence Zheng was gambling by June or July 2010.
He also claimed that he was in great financial debt because of failed businesses, but had no evidence to back it up.
Furthermore, evidence showed that despite his claim of financial hardship, he still chalked up large bills on his credit cards and was financially supporting a second family.
"There was also clear evidence that (the husband) had not made full and frank disclosure of his assets," wrote the judge.
"On the contrary, he tried to hide his assets and was frequently caught out on his inconsistent affidavits and cross-examination thereon."
After the divorce, Zheng was ordered to pay Madam Mok $1.15 million in maintenance and $7.05 million for her share of matrimonial assets, including the $4.25 million Stevens Court apartment.
He was ordered to pay the mortgage on the apartment and transfer the property, debt-free, to his wife.
But he flouted the order and the bank sold the flat for $3.5 million, of which Madam Mok received only $650,000 as the bulk was used to pay his other debts.
Madam Mok then took him to court on contempt of court for failing to comply with a court order.
Throughout court proceedings, Zheng claimed to be in financial hardship and unable to afford the payment, adding that he should not be jailed because of his ill health.
However, the Court of Appeal ruled that Zheng had deliberately defied court orders time after time, and despite numerous opportunities to purge his contempt, continued to refuse to pay up.
After sentencing him to eight months' jail, the three-judge court suspended the sentence for four weeks to give him one last chance to make payment.
Zheng still did not comply and started serving his sentence on Oct 9 last year.
There was also clear evidence that (the husband) had not made full and frank disclosure of his assets. On the contrary, he tried to hide his assets and was frequently caught out on his inconsistent affidavits and cross-examination thereon.
- The divorce judge
Lawyers: Hidden assets always get exposed
It is common for people to try to hide assets in divorce proceedings, said family lawyer Rina Kalpanath from Kalco Law.
In her 20 years of practice, she has come across many cases where people involved in divorce proceedings try to hide assets by transferring them to siblings or relatives under the guise of owing a debt.
"When (the divorce) comes, out of the blue, they say they owe their mum or sister $20,000 or $100,000," said Ms Kalpanath.
"These people are only worth about half a million, so it's unusual when they suddenly declare a debt that goes into a few hundred thousand dollars."
Ms Kalpanath also said that some people think it is "safe" to hide assets in offshore or smaller banks, but these accounts can be tracked down when clients are ordered to declare bank statements and records.
Another lawyer, Mr Rajan Supramaniam of Hilborne Law, said that some people might try to undervalue their assets for the sake of paying less for maintenance fees or division of assets, but it is only a "matter of time" before they get found out.
He said: "It gets suspicious when people start transferring large amounts of money to their siblings before divorce proceedings.
"It's not a risk worth taking because the party can be held in contempt of court. The court might also draw an adverse inference and the judgment might be less favourable to the party."
Ms Kalpanath said that she always advises clients to "come clean".
"If clients don't give full disclosure of their assets, how can we help them?" she said.
"Giving full disclosure also helps the client maintain credibility in front of the judge. Then the court knows that our clients are not there to lie or cheat them or their spouse."
Sequence of events
July 25, 1983
Zheng Zhuan Yao and Madam Mok Kah Hong are married.
Aug 22, 2008
Zheng, through his lawyers, writes letter to Madam Mok to suggest a divorce.
Dec 30, 2009
In a second letter, Zheng says he would like to begin annulment proceedings.
Jan 19, 2010
Their Stevens Court apartment is mortgaged.
Jan 21, 2010
Zheng allegedly transfers shares worth $1 million to his aunt.
Feb 26, 2010
Divorce proceedings begin.
June 11, 2010
Zheng transfers $3 million worth of shares to his father.
Sept 15, 2010
Madam Mok obtains an injunction to stop Zheng from disposing of any more of his properties, as well as the Stevens Close home.
After a High Court hearing, Zheng is ordered to pay up.
Madam Mok takes Zheng to court for refusing to pay up.
The matter is taken to the Court of Appeal.
Sept 10, 2015
Zheng is given four weeks to pay up.
Oct 9, 2015
Zheng starts his jail sentence for contempt of court. The money is still unpaid.