Anolick and Anolick (No 2)

[2019] FamCA 653

FAMILY COURT OF AUSTRALIA

ANOLICK & ANOLICK (NO. 2) [2019] FamCA 653

FAMILY LAW – PRACTICE & PROCEDURE – Financial proceedings – party seeks to adduce evidence otherwise than from a single expert witness without application being made in accordance with Rule 15.49(2) – difference in opinion of two properties is alleged to be $2.4 million – conference of valuers ordered as a compromise and preparatory to any application being made for permission to rely on the evidence of an expert other than the single expert witness – natural justice – relevant and probative evidence.

APPLICANT: MR ANOLICK

RESPONDENT: MS ANOLICK

FILE NUMBER: MLC 5060 of 2012

DATE DELIVERED: 4 September 2019

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Bennett J

HEARING DATE: 4 September 2019

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr G. Dickson QC

SOLICITOR FOR THE APPLICANT: Lander & Rogers

COUNSEL FOR THE RESPONDENT: Mr I. Coleman SC with Mr G Thompson

SOLICITOR FOR THE RESPONDENT: Rickards Legal

Orders

1. On or before 12 noon on Wednesday 11 September 2019, the wife file and serve any application upon which she proposes to rely, pursuant to rule 15.49 of the Family Law Rules 2004 with such affidavit material as she relies upon in support of that application.

2. By not later than 5 pm on 9 September 2019 Mr V confer with the single expert witness Mr FF in relation to their respective views of the values of the properties at T Street, Suburb U and JJ Street, Suburb S, and prepare a memorandum setting out the following:

   (a)The matters upon which they agree and disagree;

   (b)In relation to matters of disagreement, why each expert maintains that his opinion is to be preferred over the opinion of the other;

   (c)An identification of a substantial body of opinion held by Mr V which is contrary to that held by Mr FF (if any);

   (d)The matters (if any) known to Mr V which were allegedly not known to Mr FF at the time of Mr FF preparing his report on 16 August 2019.

3. Any application filed by the wife pursuant to paragraph 1 herein be set down for hearing before me at 9 am on 12 September 2019 and both senior counsel are granted leave to appear by telephone.

4. My reasons for decision this day be transcribed, when settled, be placed on the Court file and a copy provided to the parties.

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 Anolick & Anolick 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 MELBOURNE

FILE NUMBER: MLC 5060 of 2012

MR ANOLICK

Applicant

And

MS ANOLICK

Respondent

EX-TEMPORE REASONS FOR JUDGMENT

1. A preliminary issue arises on the morning of the first day of the final trial of this financial matter.  Mr Dickson, one of Her Majesty’s Counsel, appears for the applicant husband and Mr Coleman of Senior Counsel appears with Mr Thompson for the respondent wife.

2. A matter in issue in these financial proceedings is the value of real property situated at T Street, Suburb U in Victoria and the property at JJ Street, Suburb S, being premises from which the husband, through various corporate entities, operates a business selling motor vehicles, ‘GG Business Melbourne’s Cheapest Vans and Utes’. 

3. This is the second, if not third, occasion on which the matter has been listed for final hearing.  There has been, during the pretrial stage, various developments, including the disposition of a major business premises and undertaking operated by the husband, restructuring some parts of the business, and significant works done on one of the properties, in particular at T Street, Suburb U.

4. On 18 January 2018 I made inter alia the following orders, by consent;

   1. Pursuant to Rule 15.49 of the Family Law Rules, the wife have leave to file and serve an affidavit of Mr V of HH Pty Ltd in relation to the value of:-

   a)    R Street, Suburb S in the State of Victoria; and

   b)    T Street, Suburb U in the State of Victoria;

   and to rely on such evidence at trial.

   2.    Mr V and Mr W (of X Valuations) confer in relation to their respective views of the value of the properties referred to in paragraph 1 herein and prepare a Memorandum setting out the matters upon which they agree and disagree, and in relation to matters of disagreement, why their opinion is to be preferred.

5. The first mentioned order was made in the context of the final hearing of the matter, then set down for March 2018.  The affidavit evidence of Mr V, which was to be admitted by consent, necessarily related to a report done by a Mr Dickinson prior to 18 January 2018.  Since that time the property at R Street, Suburb S has been sold, and as part of the restructuring of the husband’s business, significant works have been done on the property at T Street, Suburb U.  The business has also been re-orientated to industrial vehicles rather than non-industrial, everyday vehicles. 

6. Yesterday the wife apparently filed an affidavit from Mr V which contrasts with that filed by Mr FF.  Mr FF is the single expert witness in the case.  He estimates the value of the property at T Street at some $7.43 million, whereas Mr V, I am told (not having read the affidavit filed yesterday) puts the value of that property at $9.85 million, a discrepancy of some $2.4 million. 

7. Mr Dickson, for the husband, opposes reliance by the wife on the evidence of Mr V as being contrary to rule 15.49(1) of the Family Law Rules 2004 which provides that a party will not, without the court’s permission, adduce evidence from an expert other than a single expert witness. 

8. On the preliminary point, Mr Coleman, for the wife, submits that paragraph 1 of the order made on 18 January 2018 refers to “an affidavit of Mr V” and the purpose of it being “to rely on such evidence at trial.”  Mr Coleman’s case is that the affidavit filed yesterday is the affidavit upon which the wife seeks to rely, pursuant to paragraph 1, and that the reference to “trial”, notwithstanding that the context in which the order was made related to a trial occurring in March 2018, should apply to this trial of the matter which commences in September 2019.  I do not accept Mr Coleman’s submission.

9. The Family Law Rules and the principles which find expression in rule 15.49 provide for some streamlining of evidence, underpinned by the policy consideration of parties not being put to undue expense in relation to expert evidence over matters on which experts do not fundamentally, as a matter of principle or methodology, disagree. That policy has probably not worked in this case. The parties have spent, as of today, in excess of $2 million preparing this matter for trial, and some not insignificant part of those moneys have no doubt been spent on retaining experts similar to Mr V. However, rule 15.49 constitutes a rule of the court and, unless I dispense with the operation of it, pertains to this case.

10. I am satisfied that when the order of 18 January 2018 was made, it being by consent, it was in contemplation of a hearing in March 2018. Insofar as there are preconditions to permission and those preconditions find expression in rule 15.49 (2), they relate to the evidence of Mr Dickinson as it was expressed prior to January 2018 and the evidence of Mr V which was expressed shortly thereafter. The preconditions are the Court being satisfied that:-

    (a)  there is a substantial body of opinion contrary to any opinion given by the single expert witness and that the contrary opinion is or may be necessary for determining the issue;

    (b)  another expert witness knows of matters, not known to the single expert witness, that may be necessary for determining the issue; or

(c)  there is another special reason for adducing evidence from another expert witness.

1. Mr Coleman has also pointed out that there have been significant intervening circumstances in this case and significant improvements in renovations and remodelling made to the property at T Street, Suburb U.  That is a double-edged sword for him.  It points to the fact that the opinion evidence in respect of which Mr V may now express an alternative opinion is to be evidence in relation to a differently configured property.

2. I am satisfied that, if the wife wants to adduce evidence on the same issue, being the value of T Street, Suburb U, and a property at JJ Street, Suburb S, she must do so by qualifying under rule 15.49, or at least making an application in that respect.

3. The relief under r 15.49 to appoint another expert is discretionary.

4. At the moment Mr Coleman is not able to point to a substantial body of opinion on which Mr FF and Mr V are apart within the context of r 15.49(2)(a).  In referring to Mr FF I note that he has taken the place of Mr Dickinson as the single expert witness.  Mr Coleman likewise cannot at this point identify matters not known to Mr FF but known to Mr V in the context of r 15.49(2)(b). 

5. Senior Counsel for the wife seeks an order that Mr V and Mr FF confer in relation to the value of the properties and prepare a memorandum setting out matters upon which they agree and disagree, and in relation to matters of disagreement why the opinion of one of them is to be preferred over the other.  I gather that Mr Coleman’s expectation is that a conference of valuers will produce the evidence he needs to qualify under r 15.49.

6. The trial will run for some days this week.  It will then recommence on 23 September.  I am not averse to the valuers meeting and preparing a memorandum, providing that their meeting can occur and I can determine the issue of whether the wife will be permitted to rely upon Mr V’s evidence well prior to the resumption of this matter on 23 September.  It would be most unfortunate, in my view, if the parties were to approach the second tranche of the proceedings on 23 September 2019 without knowing who will be witnesses.

7. I should make some comment on the submissions made by Mr Coleman in relation to a residual discretion by me to rescind the order made on 18 January.  By residual discretion I take it that he means the discretion in the Family Law Rules to dispense with operation of the Rules which is found in r 1.12.  His submission was that to deny the wife the right to lead evidence from Mr V will cast a “cloud” over the hearing and any final determination.  He also submits, I think, that a discrepancy of $2.4 million in an asset pool such as this case is a factor which is a “special reason” within the meaning of r 15.49(2)(c). 

8. The purpose of the Rules is the attainment of justice not to require parties to jump through hoops at added expense as to legal fees or prolongation of court time.  The operation of the Rules must not be an impediment to the achievement of justice.  Natural justice is a necessary part of a just result and the Rules should not operate to exclude evidence which is relevant or probative to matters in issue, such as the value of the commercial properties at T Street, Suburb U or JJ Street, Suburb S. 

9. If the discussions between Mr V and Mr FF discloses matters which are more properly the ambit of cross-examination than of alternative evidence, the outcome will be that the wife will not be entitled to call Mr V to give expert evidence.  That does not mean Mr FF’s evidence cannot, however, be attacked in cross‑examination including by use of Mr V as a shadow expert.

10. Rule 15.49 leaves the door ajar to admit competing evidence based on alternative methodology or facts not known to the existing single expert or for “special reasons”. However, there is no invitation to introduce evidence which merely ups the ante as a means of getting the single expert to increase his valuation. Experts must act with integrity. They should not be given ‘riding instructions’. I make these comments because I am extending considerable latitude to the wife to arrange a conference between Mr V and Mr FF without first being satisfied that Mr V has a principled or good reason to express an opinion that is materially different from that expressed by Mr FF. Mr Dickson has, very reasonably in my view, not objected to the cart being put before the horse.

I certify that the preceding twenty (20) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Bennett delivered on 4 September 2019.

Associate: 

Date:  12 September 2019