BOLLEN & BOLLEN

[2019] FamCA 542

FAMILY COURT OF AUSTRALIA

BOLLEN & BOLLEN [2019] FamCA 542

FAMILY LAW – PROPERTY – Value of property – Expert evidence – where an expert property valuer was appointed jointly by the parties for the purposes of a mediation and prior to the commencement of proceedings – where the wife seeks to appoint a different valuer as the single expert to prepare a valuation of the same real property now that proceedings have commenced – where the husband opposes that application and says the valuer jointly appointed for the purposes of the mediation should be the single expert for the purpose of the proceedings and provide an updated valuation of the real property – orders that the existing property valuer be appointed as single expert to provide an updated valuation of the real property

APPLICANT: Ms Bollen

RESPONDENT: Mr Bollen

FILE NUMBER: MLC 10697 of 2017

DATE DELIVERED: 13 August 2019

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Macmillan J

HEARING DATE: 12 June 2019

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Bartfeld QC with Ms Johnston

SOLICITOR FOR THE APPLICANT: Kenna Teasdale Lawyers

COUNSEL FOR THE RESPONDENT: Dr Ingleby

SOLICITOR FOR THE RESPONDENT: Marshalls and Dent and Wilmoth Lawyers

Orders

1. By 4.00pm on 3 September 2019 the husband and the wife do all acts and things and sign all necessary documents required to appoint H Company to prepare updated valuations at the parties joint expense of the following real properties:

   (a)       The property situate at and known as D Street, Town F in the State of Victoria; and

   (b)       The property situate at and known as E Street, Suburb G in the State of Victoria.

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 Bollen & Bollen 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 10697 of 2017

Ms Bollen

Applicant

And

Mr Bollen

Respondent

REASONS FOR JUDGMENT

1. This matter was listed for a trial management hearing before me on 12 June 2019. The parties had prepared a minute of orders with a view to the matter being listed for a final hearing.

2. The husband and wife in this case were married in 1971 and separated in March 2017, a marriage of approximately 45 years. The husband is 75 years of age and the wife is 70 years of age. Both of the parties are retired. The parties in their different capacities built up a substantial asset pool during the course of their long marriage. That asset pool includes an apartment in Melbourne and a property in Town F

3. Although the parties have agreed that the wife will retain the Melbourne apartment and there will otherwise be an equal division of their assets, their combined entitlements in their self-managed superannuation fund and the husband’s monthly pension, there is a dispute about the value of the Town F property (the “Town F property”) and the mechanics of the orders in circumstances where the husband wishes to retain the Town F property and the wife seeks orders for its sale.

4. The Town F property was purchased by the parties in 2010 for 6.7 million and they subsequently built a large, and the wife says unique, home at a cost of between $6 and $7 million.

5. Following separation but prior to the wife commencing these proceedings, the parties jointly engaged H Company to value both Town F property and the Melbourne apartment for the purposes of mediation. A letter of instruction was sent to H Company. There does not appear to be any dispute that the letter of engagement complied with Rule 15.54 of the Family Law Rules 2004. According to H Company, the value of the Town F property as at 31 August 2017 was $11 million. At about the same time the parties also obtained appraisals from B Company and C Company and who valued the property at $16.5 million and 12.5 million respectively. The wife relied upon these assessments in support of her case that the Town F property is a unique property which is difficult to value and in those circumstances the most effective way to establish the value of the property is to put it on the market and sell it.

6. In essence the wife’s submission was that the single expert rules only apply for the purposes of resolving a substantial issue in a case and when H Company were appointed there was no case and a single expert should now be appointed.  

7. It is the husband’s case that H Company, having been jointly engaged in anticipation of a mediation and in circumstances where proceedings had been contemplated, should be appointed as the single expert witness for the purposes of valuing the real property now that proceedings have commenced. The husband submits that H Company could prepare an updated report to their 2017 valuation at a reduced cost to the parties.

8. The purpose of the single expert rules are set out in Rule 15.42 as follows:

   a)To ensure that parties obtain expert evidence only in relation to a significant issue in dispute;

   b)To restrict expert evidence to that which is necessary to resolve or determine a case;

   c)To ensure that, if practicable and without compromising the interests of justice, expert evidence is given on an issue by a single expert witness;

   d)To avoid unnecessary costs arising from the appointment of more than one expert witness; and

   e)To enable a party to apply for permission to tender a report or adduce evidence from an expert witness by that party, if necessary in the interests of justice. 

9. In my view there is nothing in the Rules that would preclude an expert jointly appointed by the parties before the commencement of a case from being appointed as a single expert witness. To the contrary. whilst the parties in this case may not be troubled by the cost of another valuation, there is some force in counsel for the husband’s submission that parties in a lesser financial position might not be as willing to incur the cost of a single expert valuation before proceedings are commenced for fear they would not be able to rely on that expert once proceedings are on foot, wasting the money spent on that valuation.  In my view that is not what the Rules intend. The court has an obligation to limit the cost of the proceedings and all H Company have to do is update their valuation.

10. The Rules also do not require the appointment of the expert engaged prior to the commencement of the proceedings as the single expert once those proceedings have commenced. There are clearly circumstances in which it might not be appropriate to appoint the expert appointed for the purposes of a mediation as the single expert. However in this case the wife makes no complaint about the independence of H Company or about the valuation itself save and except to highlight the difference between the two appraisals and the sworn valuation of Town F. I also note there was no complaint in relation to the valuation of the Melbourne apartment. The crux of the wife’s case appears to be the uniqueness of the property rather than any flaw in the valuation process. As submitted by counsel for the husband, there are all sorts of reasons why appraisals might differ from a sworn valuation and I am not a position to make any findings as to the valuation prepared by H Company based upon those appraisals. In any event the wife will have the opportunity provided by the Rules to direct questions to the single expert and if she considers it necessary to seek leave to adduce the evidence of her own expert subject to her establishing a basis for the court making that order.   

11. There is in this case a significant issue in dispute and I am satisfied that evidence in relation to that issue should be given by a single expert witness and in all of the circumstances of this case that should be H Company. Although the appointment of a single expert witness is intended to simplify the case this may be overly optimistic in circumstances where it seems likely that whichever course the court adopts one or other party will seek leave to adduce evidence from their own expert witness and it seems that whoever is appointed as the single expert and whatever value is placed on the property, it is the wife’s case that it should be sold.

12. I propose to otherwise list the matter for mention to make directions for a final hearing.   

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Macmillan delivered on 13 August 2019.

Associate:

Date:  13 August 2019