Angliss and Angliss (No 2)
[2016] FamCA 823
•29 September 2016
FAMILY COURT OF AUSTRALIA
| ANGLISS & ANGLISS (NO 2) | [2016] FamCA 823 |
| FAMILY LAW – PROPERTY – Interim – Mandatory Injunction – Whether the wife should be compelled to provide identification to the bank – Where identification is required to obtain a bank guarantee for the parties’ business – Where the business is contractually obliged to obtain a bank guarantee in the order of $233,000 – Where failure to obtain the bank guarantee would create a real risk of substantially reducing the value of the business entities and matrimonial pool. FAMILY LAW – PROPERTY – Interim – Disclosure – Whether the wife has complied with her duty to disclose – Application dismissed. |
| Evidence Act 1995 (Cth) s 55 Family Law Rules 2004 (Cth) 13.01(1), 13.04(1), 13.07, 13.3, 13.18, 13.22, 13.26(1), 15.46, 15.47 |
| Mullen and De Bry (2006) FLC 93-293 Waugh and Waugh (2000) FLC 93-052 |
| APPLICANT: | Mr Angliss |
| RESPONDENT: | Ms Angliss |
| FILE NUMBER: | BRC | 1878 | of | 2015 |
| DATE DELIVERED: | 29 September 2016 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Forrest J |
| HEARING DATE: | 26 September 2016 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr K. Wilson QC |
| SOLICITOR FOR THE APPLICANT: | MacDonnells Law |
| COUNSEL FOR THE RESPONDENT: | Dr Ingleby |
| SOLICITOR FOR THE RESPONDENT: | HopgoodGanim Lawyers |
Orders
That by close of business on Tuesday, 4 October 2016, the wife shall attend at the Westpac Banking Corporation, G Town Branch, and provide 100 points of identification in such form as required by Westpac.
The applications of the husband sought in terms of paragraphs 2 and 3 of the orders sought in his Application in a Case filed 29 August 2016 are dismissed.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Angliss & Angliss has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT BRISBANE |
FILE NUMBER: BRC 1878 of 2015
| Mr Angliss |
Applicant
And
| Ms Angliss |
Respondent
REASONS FOR JUDGMENT
Before the Court again on an interim application are the husband and wife in these highly conflicted property adjustment orders proceedings that are now in the pool of matters awaiting allocation to a Judge’s trial docket.
For determination this time, is the husband’s Application in a Case filed on 29 August, 2016. Relevantly, he seeks the following orders:
(1)That within 48 hours the Wife attend at Westpac G Town to provide 100 points of identification.
(2)That within 48 hours the Wife provide the documentation and information requested by the Husband’s Solicitors, MacDonnell’s Law in paragraphs 1, 2 and 6 of their letter to HopgoodGanim dated 2 August 2016.
(3)That within 48 hours the Wife instruct her solicitors to sign the letters of instruction to:
(3.1) J Valuers Jewellers; and
(3.2) I Partners;
to proceed with the valuations of the parties’ jewellery and artwork.
The wife opposed the husband’s application for these orders.
Some Background
I set out some background facts in a judgment delivered on 17 February this year on an earlier Application in a Case brought by the wife. I will include some of them again.
The husband and wife were married for 41 years and have three self-supporting adult children. The husband contends that neither party brought any assets of substance to the marriage at the start. Their marriage ended with separation in 2014. A business is operated through an array of companies and trusts. Since well prior to separation, the wife has had little personal involvement in the operation of the business. The husband has always run it.
The business, which operates internationally, has generated significant wealth for the parties, which is primarily held in the form of real property, the business itself and superannuation entitlements. The wife contends the total net value of their property and superannuation interests is something in excess of $16,612,000, which includes an amount of $5,443,000 attributed to the value of the business entities said to have been opined by a single expert accountant, and an amount of $5,332,213 said to be the value of their interests in a self-managed superannuation fund, the assets of which are principally two pieces of real property.
In July this year, the parties agreed for orders to be made by Carew J of this Court that were extensive and detailed and provided for the sale of their former matrimonial home in Brisbane and the Queensland and Victorian properties that are assets of their self-managed superannuation fund. Those orders were made by consent in compromising competing interim applications each had made at that time. As extensive as those orders were, the husband filed the Application now being determined just over one month after those orders were made.
The Application for a mandatory injunction ordering the wife to show her driver’s licence and Medicare card to the Westpac Bank
One of the business entities, D Pty Ltd (“D PL”), previously operated out of the Queensland property owned by the superannuation fund that was ordered to be sold by the July consent orders. That company has entered into a lease on new premises in another part of Brisbane. The husband asserted through a solicitor’s letter adduced into evidence that the property owned by the superannuation fund was now too big for the business’s need and that is the reason why it has moved to new, smaller premises.
In respect of the new premises, the husband says that D PL “is required to provide a bank guarantee with respect to 6 months rent”. A copy of the Lease executed on 21 July this year by the husband as director of D PL is in evidence showing that D PL has an obligation pursuant to the Lease to provide the Landlord with a bank guarantee in the order of $223,000.
The husband’s evidence in his affidavit is that the bank guarantee must be in place by 30 September (although clause 20.1 of the Lease said it was to be provided “on or before executing this Lease”). At the hearing, the Court was informed by Queen’s Counsel for the husband that an extension of the date by which the bank guarantee was to be in place to 30 October had been agreed with the Landlord. However, the husband’s evidence is that D PL has already entered the new premises and commenced building work there. He said that the Landlord could terminate the lease if the bank guarantee is not provided and could require D PL to vacate the premises. The husband said “that would be of considerable financial loss as well as inconvenience to the business”.
The husband said that although the wife is not a director of D PL, she is a director and shareholder in Angliss Pty Ltd (“A PL”), a holding company which holds a 50 per cent share in D PL. The husband said that he has negotiated the provision of the bank guarantee with Westpac and Westpac has advised him that as the wife is a director of A PL, she is required to produce 100 points of identification to “allow the bank guarantee to proceed”. He has adduced evidence that shows that Westpac assert they require this because of legislative (anti-money laundering legislation) requirements. The husband said that all that is required is for the wife to go into her nearest Westpac Bank branch (G Town) and show the manager her driver’s licence and her Medicare card. He said that he had been asking the wife to do so since early August without any success.
In his evidence filed in support of the application, the husband also said that the wife has done “damage” to the relationship with the business’ previous bank (NAB) by: (i) telling NAB that she would no longer support the bank guarantee for a $2 million working capital facility that was in place which led to NAB withdrawing the facility, leaving the business to operate on a “very constraining cash only basis”; and (ii) by subpoenaing NAB to produce documentation in relation to communications with NAB even though he had already disclosed everything of relevance. He said that since June 2015 his dealings with NAB have been “fraught and difficult” and that, as a result, he had made “the commercial decision that is in the interest of the business to try to develop a new banking relationship”. He then said that as a starting point he has approached Westpac to provide the bank guarantee entry into the lease requires.
In her affidavit filed in support of her opposition to the application, the wife said that she does not disagree that a bank guarantee is required pursuant to the lease D PL has entered into. She says she opposes obtaining a bank guarantee from Westpac as she does not consider it necessary to change bankers from NAB to Westpac and says that if a bank guarantee was obtained from NAB she would not have to provide any identification. She says that she fears that the husband’s efforts to foster a new banking relationship with Westpac “are borne from an intention to cut me out of any banking relationship”. She disagrees with the husband’s assertions that the banking relationship with NAB has suffered, despite her withdrawal from the $2,000,000 personal guarantee.
Counsel for the wife referred the Court to considerations of principle as discussed by Cronin J of this Court in Todd & Todd [2016] FamCA 79 which included reference to a Queensland Supreme Court decision involving an application for a Mareva injunction and some High Court decisions: Jackson v Sterling Industries (1987) 162 CLR 612; ABC v Lenah Game Meats Pty Ltd (2008) 208 CLR 199; and Castlemaine Tooheys Limited v South Australia (1986) 161 CLR 148. In Todd, Cronin J also referred to the well-known decisions of the Full Court of this Court in Waugh and Waugh (2000) FLC 93-052 and Mullen and De Bry (2006) FLC 93-293.
Counsel for the wife submitted that there is simply “no proper evidentiary basis” for granting the interim injunctive relief sought by the husband, particularly where the husband has not been very forthcoming in respect to consulting the wife about important decisions that relate to the current need for a bank guarantee to be provided.
Application of principle to the current circumstances
There is no disagreement that the Court has the power to make an order of the nature sought by the husband. The Full Court said in Waugh and Waugh (2000) FLC 93-052 at [32] when discussing a submission made by counsel that interlocutory injunctions were “truly akin to a Mareva injunction”, amongst other things, that it is important to bear in mind that the jurisdiction to grant interlocutory injunctions under the Family Law Act 1975 (Cth) (“the Act”) derived from s 34(1) and or s 114(3) of the Act. Section 34(1) of the Act provides:
The Court has power, in relation to matters in which it has jurisdiction, to make orders of such kinds … as the court considers appropriate.
Section 114(3) provides:
A court ... may grant an injunction, by interlocutory order or otherwise … in any case in which it appears to the court to be just or convenient to do so and either unconditionally or upon such terms and conditions as the court considers appropriate.
The Full Court in that case also expressed the view (at [31]) that it is important to bear in mind the difference between the type of proceedings at law in which Mareva injunctions are sought and proceedings under s 79 of the Act. The Full Court stressed the essential connection between the substantive proceedings and the relevant property about which the interim injunction is sought in s 79 proceedings that does not exist in proceedings in which Mareva injunctions are generally sought.
Notably, in my judgment, the Full Court in Mullen and De Bry (2006) FLC 93-293 at [43(b)] said, after discussing that which the Full Court had said in Waugh:
If anything, these remarks imply a more liberal approach in applications in the Family Court for preservation of property than at general law…
and went on to highlight (at [46]-[47]) that it is “helpful to recognise that the essential power being exercised” is “simply described in s 114(3)” requiring each case to be determined by “overall assessment of a number of factors” in arriving at the “just or convenient result”.
The facts of this case are somewhat different from the case where a party to property adjustment proceedings pursuant to s 79 of the Act seeks an interim injunction to restrain the other party from disposing of property pending the final determination of the proceedings. In this case, a party to proceedings pursuant to s 79 seeks a mandatory injunction on an interim basis to compel the other party to do something required to avoid potential loss of substantial amounts of money by one of the parties’ business entities, but which she does not want to do. The subject matter is, though, still essentially asset preservation pending final determination of the s 79 proceedings.
With something in the vicinity of $16,000,000 worth of net property and superannuation interests, and the parties seemingly prepared to sell their business interests and some of their real properties as they move towards the finalisation of their property adjustment, it might be said that the interim injunction the husband seeks is not needed to reasonably protect his rights in the s 79 proceedings. I have little doubt that is a matter to weigh in the determination process, but I do not consider it, in this case, determinative of the matter against the husband.
Clearly, where the Court is empowered to grant an injunction “in any case in which it is just or convenient to do so” the balance of convenience, competing matters of hardship or prejudice and the overall desirability of preserving property where injunction would preserve it pending the finalisation of property adjustment pursuant to s 79 are all matters to assess in determining if it is “just or convenient” to grant the interim injunction sought and any terms on which it should be granted.
In this case, it is effectively said by the wife that the husband has essentially brought the problem he is seeking to remedy by forcing her to co-operate with him, upon himself by moving the business operations from one property owned by their self-managed superannuation fund to another owned by an unrelated third-party without consultation with her or agreement. It is also said for the wife that the husband has not produced evidence that he could not obtain the bank guarantee from NAB.
That said, however, in this case, there is no dispute that the husband has effectively been running the parties’ business interests for years. With that, I accept that important business decisions have historically been made by him unilaterally, as was the decision to move the business to smaller premises ostensibly to reduce its rental outgoings in circumstances where the parties have agreed to now sell the premises that were previously occupied by the business. Where there is no dispute that the wife withdrew her personal guarantee (a valuable one because of real property owned in her sole name) of the $2,000,000 debt facility that the business had in place with NAB and the husband deposes to that having caused real difficulties in the banking relationship with NAB and, consequently, for the business, the husband’s business decisions surrounding the entry into the lease and the commencement of a new banking relationship are difficult to condemn on this interim basis, without more.
What is clear and undisputed, on the evidence, is the current existence of a contractual obligation on D PL pursuant to a Lease to provide a bank guarantee for six months rental payments – around $223,000. An extension of time for the provision of that has apparently been granted. Failure to provide it, prima facie, and on the husband’s evidence, would expose the business to loss of in excess of that amount. It cannot be assumed that extensions will continue to be given or that the obligation will be waived by the landlord. The evidence is that Westpac is ready to provide the bank guarantee but for the simple provision of identification by the wife to comply with anti-money laundering legislative requirements imposed on the bank.
The husband gives evidence that the wife is not required to give any personal guarantee to support the bank guarantee being provided by Westpac. He asserts there is no prejudice to the wife in her supporting the provision of the bank guarantee by simply showing her identification to the bank. She asserts none herself, save for a belief or fear that the husband is seeking to establish a new banking relationship to her exclusion. However, disclosure obligations on the husband ensure the wife is, whilst the proceedings remain extant, provided with access to any relevant documents generated in any such new banking relationship. The dispute is simply symptomatic of the level of mistrust that the parties have reached, despite 41 previous years of marriage.
Ultimately, I consider it is in the interests of both of the parties to preserve the value of the business entities they own, particularly as those entities make up such a large portion of the value of their total net assets, pending the finalisation of property adjustment between them. Without the bank guarantee being provided soon, the current value of those business entities is at real risk of being reduced by a substantial amount. In my determination, the balance of convenience and absence of prejudice to the wife favours the granting of the injunction sought by the husband. I consider it both just and convenient, in the circumstances of this particular case, to make the order sought.
Provision of further disclosure and information
On 2 August this year, the husband’s solicitors wrote to the wife’s solicitors and, relevantly, said:
Our client requires full and complete disclosure from your client in relation to the following matters:
1.Provide details, together with copies of any correspondence, emails or other communications that your client has had with any [D]... Group employee or family member about the business operations for the last two years;
2.Provide details, together with copies of any correspondence, emails or other communications that your client has had with Wells Fargo Bank or any other bank with respect to the [D]… Group, including any documentation presented to Wells Fargo or any other bank;
…
6. Provide full and complete details of any information your client has been provided either by employees of the [D]... Group or other persons in relation to the [D]… Group Project [in the US] or any other project.
The wife’s solicitors wrote back on 15 August and asked for an explanation as to the relevance of the request contained in point 1 above. They then said, referencing the request in point 2, their client would “collate disclosure in respect of emails sent to / received from the National Australia Bank.” They then again asked for an explanation of the relevance of the request in point 6.
The husband’s solicitors responded by letter on 18 August. As to the request contained in point 1, they said:
…
The enquiry is relevant to the proper ongoing management of the [D]… Group. Your client has no formal role in that group and any communications by her with employees would be inappropriate from her point of view and potentially a breach of employment by the employee involved. Any communications by your client would be, so far as the group is concerned, at best distracting, and at worst possibly destructive. From the employee’s point of view any communications would be a breach of confidentiality and a breach of the Employment Contract. If your client’s focus was the best interests of the business she would provide this information.
As to the request contained in point 2, they said:
We note your client has not responded in relation to correspondence, emails or other communications with Wells Fargo Bank. We note what you say about communications with the National Australia Bank however the enquiry was directed principally to Wells Fargo Bank. Our client does not believe that this was an accidental oversight but rather believes your client is deliberately avoiding providing the relevant information. If your client’s focus was the best interests of the business she would provide this information.
As to the request contained in point 6, they said:
The relevance of the enquiry is as set above in relation to point 1. Your client has throughout the course of this matter kept pushing for further information in relation to the [US] project, something that would not be within her knowledge independently. It would seem from your client’s enquiries that she has received incorrect information in relation to the [US] project. Please provide details of the information received and the source for that information.
On 29 August, the wife’s solicitors wrote back and said, as to point 1:
It is nonsensical to suggest that our client would seek to communicate with employees of the [D]… Group in a distracting or destructive manner.
At this point, it is relevant to remind your client that our client remains director and shareholder in respect of a number of entities within the [D]… Group. Further our client used to work within the Group, and in this respect we refer you to our client’s affidavit material.
It appears as though your client intends on proceeding with a “witch hunt” in respect of any employee who has spoken to our client. To what end? In circumstances where your client repeatedly asserts he has made disclosure, why is it relevant as to who our client converses with? We fail to see why this is in any way an issue relevant to the proceedings or the ongoing management of the business.
Our client will not respond to this point further.
As to point 2, they said:
Our client confirms there has been no correspondence with Wells Fargo or any other bank in respect of the [D] Group, other than what has already been noted.
As to point 6, they said:
Refer to point 1.
To set your client’s mind at rest however, our client can confirm that she has known about the [US] project from before the project was won. Prior to her retirement, the General Manager of [D]USA, Ms H, told our client about the [US] project. [Ms H] was excited about the project, as she expected the profit from the project would greatly bolster [D]USA figures for the following year. Information that the project and [D]... “had miserably failed” was provided by your client during the course of these proceedings.
After the husband’s solicitors had filed the Application now being determined, they wrote a response to the wife’s solicitors. It was lengthy, but, relevantly, it pressed the husband’s position, asserting that the wife “is studiously avoiding providing the information requested”, that “she continues to evade providing the information sought”, and that she “has things to hide” as indicated by her “deliberate and wilful refusal to provide this information”.
An affidavit of the husband was then filed to support his Application in a Case previously filed. In that, he says that he has “become aware that incorrect information has been provided to Wells Fargo Bank” and he then said that incorrect information related to the ownership of a company in the D Group and the wrong address to which bank statements were sent had been provided.
The written submissions of Queen’s Counsel who appeared for the husband referred to these matters of evidence in support of this part of the husband’s Application in a Case. With respect, the submissions really advanced the case no further than the evidence did. That evidence did not advance a case that damage that might impact on the business’s value has actually been done by actions of the wife or any other person with whom she may have communicated, thus potentially making evidence about any such action relevant in the s 79 proceedings between these two parties. That the wife might have obtained information about the business and/or projects it has been involved in from a person or persons other than the husband does not, in itself, make any documents or information about that necessarily discoverable or subject to the obligation to disclose. I will say more about the duty of disclosure further on.
In her affidavit evidence filed in support of her opposition to the husband’s application, the wife referred to all the same evidence I have referred to above. She went on to say that she believes she can take the husband’s enquiries no further than the answers provided by her solicitors in the letters cited above.
Counsel for the wife then began his written submissions on the point by correctly, in my view, submitting that the husband “does not clarify the basis upon which he seeks the documentation and information requested”. Counsel referred to Rules 13.18 and 13.22(1). These are clearly the Rules pursuant to which an application for orders about disclosure is made.
Rule 13.18 provides:
A party to an application to which this Division applies may seek only the following orders about disclosure:-
(a)that another party deliver a copy of a document;
(b)That another party produce a document for inspection by another party.
Rule 13.22(1) provides:
Application for order for disclosure
(1) A party may seek an order that:
(a) another party comply with a request for a list of documents in accordance with rule 13.20;
(b) another party disclose a specified document, or class of documents, by providing to the other party a copy of the document, or each document in the class, for inspection by the other party;
(c) another party produce a document for inspection;
(d) a party file an affidavit stating:
(i)that a specified document, or class of documents, does not exist or has never existed; or
(ii)the circumstances in which a specified document or class of documents ceased to exist or passed out of the possession or control of that party; or
(e) the party be partly or fully relieved of the duty of disclosure.
The order sought by the husband is not an order that is clearly brought within the parameters of those two Rules.
Counsel for the wife also submitted that if the request is actually a request within the parameters of Part 13.3 of the Rules (headed “Answers to Specific Questions”) then such questions are premature within the terms of Rule 13.26(1) which permits a party to serve a request to answer specific questions “after a case has been allocated to a first day before a Judge”. In terms of the case management system in place in the Brisbane Registry now, that reference to “first day before a Judge” equates to the day, after the matter is allocated to a Judge’s trial docket, upon which it is listed before that docket Judge for a Trial Management Hearing. That day has not yet been reached in this case.
No submissions were made on behalf of the husband with a view to bringing the matter within the parameters of any of those Rules or otherwise seeking dispensation of the application of those Rules. Accordingly, where the order sought is an order that requires the wife to provide “documentation and information” requested in terms of “[p]rovide details, together with copies of any correspondence, emails or other communications”, having regard to the Rules and the way in which the letters between the solicitors reflect the issue as being handled to this point, I do not consider it appropriate to make the order in the terms the husband seeks.
It is, nevertheless, worthwhile, in my judgment, to remind each of the parties of their disclosure obligations. Rule 13.01(1) of the Family Law Rules does provide:
Each party to a case has a duty to the court and to each other party to give full and frank disclosure of all information relevant to the case, in a timely manner. (my emphasis)
Rule 13.04(1) provides:
A party to a financial case must make full and frank disclosure of the party’s financial circumstances, including:
and then sets out a long list of relevant matters.
Rule 13.07 provides the duty of disclosure applies to each document that:
(a) is or has been in the possession, or under the control, of the party disclosing the document; and
(b) is relevant to an issue in the case. (my emphasis)
The Explanatory Statement, issued in 2004 by the authority of the Judges of the Family Court of Australia, states, inter alia:
Rule 13.01: General duty of disclosure
This rule sets out the general duty of disclosure and provides that it applies from pre-action procedures to the finalisation of the case.
This rule reinforces these principles:
(a) the duty applies in all cases;
(b)the duty applies to the disclosure of information and documents; (my emphasis)
(c)it is a duty which the Court regards as very important and will scrutinise and enforce;
(d) it is a continuing duty starting with the pre-action procedure.
The importance of the duty of disclosure is emphasised in the Rules by the introduction of the following:
1.the parties are required to read the duty of disclosure before swearing the affidavit in the Form 1 and Form 1A;
2.the parties are required to acknowledge the duty of disclosure and give an undertaking as to their compliance with it at a certain stage of a case. Breach of this undertaking may be punishable as a contravention of a parenting order under the Act (section s 112AA (c) and 70 NB (c)) and may amount to contempt of court; and
3.Rule 13.14 which is intended to send a clear message that the Court will take a serious view of non-compliance with the duty of disclosure and the Rules.
Rule 13.04: Full and frank disclosure
This rule was formerly O17 r3 (FLR 1984) which has been extended to ensure it is contemporary, relevant and useful in relation to complicated financial structures as well as not so complicated arrangements.
Rule 13.07: Duty of disclosure - documents
This rule imposes a duty on a party to disclose documents in the party’s possession or control that are “directly relevant” to an issue. Gone are the days where the Court will allow “general discovery” ie “an order that a party produce all documents in the party’s possession or control relating to the issues in dispute.”
This follows the lead taken in the United Kingdom and Queensland in eliminating the extremely wide test established by The Compagnie Financiere du Pacifique v. The Peruvian Guano Company (1882) 11 QBD 55 which required discovery of documents which may (not must) either directly or indirectly enable the party requiring the affidavit either to advance his own case or to damage the case of his adversary. “ The results of this test was to make virtually unlimited the range of potentially relevant (discoverable) documents which parties were obliged to review and list forcing the other party to read, against the knowledge that only a handful of such documents would affect the outcome of the case. It is a monumentally inefficient and costly process.” (Lord Woolf: Access to Justice Final Report 1996)
The requirement to disclose “directly relevant” documents will introduce a higher standard of assessment in the sifting and examination of a client’s documents. This will oblige parties and lawyers to focus attention at an early stage upon the real issues in dispute and the documentary evidence that goes directly to those issues.
Clearly, as is said there, the duty applies to “directly relevant” documents and, I add, information. Relevance, at least in so far as it applies to evidence in proceedings in this Court, is defined in s 55 of the Evidence Act 1995 (Cth). Subsection (1) of that section provides:
(1)The evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding.
Of course, as there are no pleadings in this jurisdiction it is more difficult to accurately determine what is or is not relevant in proceedings brought pursuant to s 79 of the Act before the parties’ trial affidavits are filed and the issues are actually joined. This makes the requirement for filing Undertakings as to Disclosure prior to any trial more important, as well as requiring very careful consideration of the consequences of non-disclosure of relevant documents and information at the time such non-disclosure is satisfactorily proven.
Nevertheless, it must be stressed that the duty of disclosure imposed upon parties by the Rules is to be taken seriously by the parties. That duty is not to be selectively met by one party, whilst that party, at the same time, complains about the other party’s non-compliance.
That the Court has not made the particular order sought by the husband in this particular case does not mean that the wife is excused from compliance with her duty to disclose any documents or information that she is required to disclose on an ongoing basis or, if proven directly relevant, that such documents or information would not be ordered to be disclosed.
Letters of instruction to the two valuers
The husband’s solicitors wrote to the wife’s solicitors on 5 August this year, submitting draft letters of instruction to two separate firms of valuers – one in respect of the parties’ jewellery, the other in respect of their artworks. Copies of those draft letters are in evidence. With the draft letters of 5 August, the husband’s solicitors wrote a letter referring to a letter from the wife’s solicitors’ of 21 July and specifically saying:
We understand in light of the discussions at Court, and the Orders made, on Monday, 25 July 2016, the parties will equally pay the costs of the valuations.
The husband’s solicitors wrote again to the wife’s solicitors on 18 August telling them that the husband considered that the wife should pay for half of the valuations as a result of the orders made on 25 July and informing them that they “look forward to receiving the signed joint letters”.
The reference to the husband’s position on payment of the valuers’ fees is, it seems to me, to be a response to the position put by the wife’s solicitors in a letter they wrote to the husband’s solicitors on 21 July. In that they said:
Our client requires that your client meet payment of the valuation reports initially.
In the event your client does not agree with this approach, then please provide us with a panel of valuers in respect of each category, together with quotation, for our client’s consideration. Our client will then further consider her position.
The parties, as I have earlier observed, compromised competing interim applications and consented to orders being made on 25 July.
The draft letters sent out by the husband’s solicitors set out that each party was to be responsible for one half of the costs associated with the preparation of the reports. That despite the fact that no agreement had on the evidence I have seen actually been reached about payment.
Further, on my reading of the orders made by Carew J with the consent of the parties on 25 July 2016, I can find no order directed to each party requiring each to pay for half of the valuation reports. The orders principally provide for the sale of real properties. Ultimately, with respect to the former matrimonial home, they provide for the net proceeds of sale to be divided equally between the parties. Presumably, that is why the husband, through his solicitors, contended that the wife should be responsible for half of the valuers’ fees. I note that I am aware, from evidence before me on this Application in a Case, that property has not yet been sold.
Without more evidence as to the “discussions at Court” referred to by the husband’s solicitors, the Court is at a loss to completely comprehend why the husband’s solicitors did not actually address the wife’s position stated in the letter of 21 July from her solicitors when they wrote on 5 August and sent the drafts as they did, particularly her request for the provision of a panel of proposed valuers and quotations if the husband did not accept that he would pay the valuers’ fees “initially”. I observe also that the wife’s letter does not suggest that the wife did not agree to ultimately be responsible for half of the valuers’ fees, simply that she expected the husband to pay the fees “initially”.
In her affidavit evidence in support of her opposition to the husband’s application, the wife says on this particular point:
Prior to having been served with, or my having any knowledge that [the husband] had filed his current application in a case, I instructed [my solicitors] to write to [the husband’s solicitors] again in respect of this issue.
The wife’s solicitors did write a letter to the husband’s solicitors on 30 August which said, relevantly:
We refer to your correspondence regarding the valuations sought by your client.
Before the joint letters are signed, our client requires that quotations be prepared by the valuers your client has proposed.
We look forward to receiving the quotations from your office in due course.
The wife then says in her affidavit, and there is no dispute that it is correct, that her solicitors have not received the quotations requested.
Counsel for the wife, in his written submissions on this point, again referred to the relevant Rule of the Family Law Rules contained within Division 15.5.2 headed “Single expert witness”. He referred to Rule 15.46. That provides:
Orders the court may make
The court may, in relation to the appointment of, instruction of, or conduct of a case involving, a single expert witness make an order, including an order:
(a) requiring the parties to confer for the purpose of agreeing on the person to be appointed as a single expert witness;
(b) that, if the parties cannot agree on who should be the single expert witness, the parties give the court a list stating:
(i)the names of people who are experts on the relevant issue and have consented to being appointed as an expert witness; and
(ii)the fee each expert will accept for preparing a report and attending court to give evidence;
(c) appointing a single expert witness from the list prepared by the parties or in some other way;
(d) determining any issue in dispute between the parties to ensure that clear instructions are given to the expert;
(e) that the parties:
(i) confer for the purpose of preparing an agreed letter of instructions to the expert; and
(ii)submit a draft letter of instructions for settling by the court;
(f) settling the instructions to be given to the expert;
(g) authorising and giving instructions about any inspection, test or experiment to be carried out for the purposes of the report; or
(h) that a report not be released to a person or that access to the report be restricted.
Counsel for the wife submitted that the husband’s application is premature and inadequate by reason of his non-compliance with the requirements of Rule 15.46, in particular Rule 15.46(b)(ii), and his non-responsiveness to the wife’s requests for details about the fees the experts would charge.
Interestingly, neither party made reference to Rule 15.47 which actually provides:
(1) The parties are equally liable to pay a single expert witness’s reasonable fees and expenses incurred in preparing a report.
(2) A single expert witness is not required to undertake any work in relation to his or her appointment until the fees and expenses are paid or secured.
There is a note to the Rule that it applies unless the Court orders otherwise.
Of further relevance to the point, the husband’s solicitors tendered into evidence (exhibit 1) a copy of a long and detailed letter from the wife’s solicitors dated 8 July 2015 in which they said, amongst many other things, that there was agreement that All Asset Appraisals and J Valuers could undertake valuations of the parties’ respective chattels and they requested the husband’s solicitors provide them with the joint letter of engagement to each expert to commence the valuation process. The letter also said “our client agrees to the engagement of [Ms I]”. I can only assume that is a person from the firm I Partners now sought, by the husband, to be engaged as the single expert to valuer the parties’ artworks.
Clearly, almost fifteen months have passed since that letter was written and for some reason, unexplained by the evidence, the joint letter of instruction to J Valuers (or to I Partners) was apparently not presented to the wife’s solicitors before August this year. By then, clearly the wife’s prior agreement, expressed last year, had clearly been withdrawn, whether expressly or by implication (having regard to her solicitors’ July 21 letter). Even if it was tentatively proffered again in August of this year, it was proffered on the condition that the husband first obtains and provides quotations for the valuation service to be provided by the proposed experts. That request, in the light of the wording of Rule 15.46(b), can hardly be regarded as unreasonable.
However, what I do consider at least unexplained, if not unreasonable, is the apparent failure of the husband to at least obtain those quotations and provide them to the wife or include them in his evidence in support of this part of his application given that he had already filed this Application in a Case but then received the letter from the wife’s solicitors dated 30 August that contained the apparently reasonable request for the quotation to be provided before the joint letters of instructions to the experts was signed off on by her solicitors.
In the circumstances, I do accept the submission from counsel for the wife that the application for an order that the joint letters of instructions to the experts as drawn by the husband’s solicitors be signed by the wife’s solicitors was prematurely made and, in the light of the wife’s unanswered request contained in her solicitors’ letter of 30 August, still not justified. I will not make it.
Accordingly, I make the orders set out at the commencement of these reasons.
I certify that the preceding seventy-two (72) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Forrest delivered on 29 September 2016.
Associate:
Date: 29 September 2016
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