Cornish & Cornish (No 2)

Case [2023] FedCFamC1F 158

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Cornish & Cornish (No 2) [2023] FedCFamC1F 158

File number: MLC 12589 of 2019
Judgment of: CARTER J
Date of judgment: 17 March 2023
Catchwords:

FAMILY LAW – PRACTICE AND PROCEDURE – where parties seek an adjournment to extend time for an expert witness to value the properties – where the applicant objects to subpoenas issued by the respondent – where the subpoenas are set aside -  

FAMILY LAW – FINANCIAL – where the husband seeks to adduce from an expert valuer which is opposed by the applicant

Legislation:

Family Law Act 1975 (Cth) ss 4, 75

Family Law Rules 2004 (Cth) r 15.52

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) rr 7.02, 7.08, 7.10, 7.11,

Cases cited: Cornish & Cornish (No. 2) [2020] FamCA 1090
Division: Division 1 First Instance
Number of paragraphs: 61
Date of hearing: 14 March 2023
Place: Melbourne
Counsel for the Applicant: Mr Christopher Dunlop
Solicitor for the Applicant: Taussig Cherrie Fildes
Solicitor for the First Respondent: Marsdens Law Group
Second to Fourth Respondents:  Litigant in person (did not participate)

ORDERS

MLC 12589 of 2019

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:

MS PEARCE AS LEGAL PERSONAL REPRESENTATIVE OF MS CORNISH

Applicant
AND:

MR CORNISH

First Respondent

CC PTY LTD

Second Respondent

DD PTY LTD
Third Respondent

MR E CORNISH

Fourth Respondent

order made by:

CARTER J

DATE OF ORDER:

17 March 2023

THE COURT ORDERS THAT:

1.The following subpoenas be set aside:

(a)subpoena to AL Pty Ltd dated 1 March 2023; and

(b)subpoena to XX Company (formerly known as YY Company) dated 1 March 2023.

2.The trial date of 3 April 2023 be vacated.

3.The matter be listed for final hearing on 16 October 2023 for four days.

4.The matter is otherwise adjourned for a further case management hearing on 5 June 2023 to commence at 10.00 am.

Note:   The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Cornish & Cornish has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

REASONS FOR JUDGMENT

JUSTICE CARTER:

INTRODUCTION

  1. The parties in this dispute are:

    (a)the applicant, Ms Pearce (“the applicant”). She is the sister of, and the legal personal representative for, the late Ms Cornish, who was married to the first respondent; and

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Cornish & Cornish (No 2) [2023] FedCFamC1F 158
Case
[2023] FedCFamC1F 158
Decision Date

CaseChat Overview and Summary

Cornish & Cornish (No 2) involved three applications concerning the final hearing of a complex property settlement dispute between a husband and the estate of his deceased wife, who was represented by her siblings as the personal legal representative. The first application was for an adjournment of the final hearing, opposed by the husband. The second related to objections to three subpoenas issued by the husband. The third was an oral application by the husband to adduce evidence from the ZZ Group about the valuation of B Company, opposed by the applicant. The court was required to determine whether the applications should be granted, considering the procedural history, the compliance with court orders, and the relevance and necessity of the proposed evidence.

The court considered the procedural history and the reasons for the applications. It noted the difficulty in obtaining a valuation for B Company due to non-compliance with court orders and the resignation of the previously appointed single expert. The court set aside the subpoenas issued by the husband, finding they were unnecessary. Regarding the husband's application to present evidence from the ZZ Group, the court found that the husband had not complied with the necessary procedural requirements, such as filing an Application in a Proceeding. Additionally, the court highlighted the purpose of the rules governing expert evidence in family law proceedings, which includes ensuring expert evidence is necessary, avoiding unnecessary costs, and promoting the use of a single expert where practicable.

The court ultimately dismissed the husband's application to adduce evidence from the ZZ Group, finding that the husband had not met the procedural requirements and that the rules did not apply as there was no order for the appointment of a single expert. The court also set aside the subpoenas and did not grant an adjournment of the final hearing. The final orders were to proceed with the final hearing as scheduled, with the subpoenas set aside and the husband's application to present expert evidence from the ZZ Group dismissed.

Orders

Orders of the court

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Background

Background to the litigation

The matter came before me on 14 March 2023 in relation to three applications:(a)the applicant’s application for an adjournment of the final hearing, which is opposed by the husband;(b)the applicant’s objections to three subpoenas issued by the husband; and(c)the first respondent’s oral application to adduce evidence from the ZZ Group, as to the valuation of B Company. This was opposed by the applicant. BACKGROUND AND PROCEDURAL HISTORY The matter has a long and complex history. Relevantly, the husband and Ms Cornish separated on 15 October 2019. There is one child of that marriage, being Z born 2009. Ms Cornish instituted proceedings on 7 November 2019. Ms Cornish died in 2021. Her three siblings are the executors of her will. The applicant was substituted for Ms Cornish as the personal legal representative in 2022. In relation to the parenting dispute, the parties in that were the husband and the maternal grandparents. Final orders were very recently made by consent pursuant to which the child will live with her maternal grandparents, who have sole parental responsibility for her. The orders further provided for the child to spend time and communicate with the father in accordance with her wishes. The family was to consult with Dr AB and one supervised visit was to be facilitated, should that be recommended by Dr AB. In relation to the property proceedings, the husband and Ms Cornish operated an investment business, B Company, which provided investment advice. B Company is held by AC Pty Ltd as trustee for the AD Trust. The husband and Ms Cornish were unable to reach an agreement as to the value of B Company, and the entities associated with it. The asset pool also includes a number of properties some of which are registered in the names of associated entities, together with shares and superannuation entitlements. The matter is listed for a final hearing to commence on 3 April 2023. It is the applicant’s case that the husband has not complied with various court orders regarding the provision of material with the effect that this has caused significant delays in the finalisation of financial statements for the various entities in which the husband has an interest. In turn, the applicant says that has caused frustrations and delays in the provision of valuations of the entities. It is clear, for instance, there has been considerable difficulty in getting the valuation of B Company completed. Earlier in these proceedings, orders were made by consent appointing Mr KK of AE Pty Ltd as the single expert to provide a valuation of the parties’ interests in B Company and any associated entity, at the equal cost of the parties. There were significant issues with the provision of information to Mr KK, and with the husband’s communications with him. Ultimately, Mr KK resigned as the single expert. In those circumstances, on 14 December 2020, Bennett J dismissed the order for the appointment of a single expert valuer. An order was made pursuant to rule 15.52 (of the Family Law Rules 2004 (Cth), as was then in force) providing Ms Cornish with leave to file evidence from an appropriately qualified person as to the value of the parties’ interests in B Company.

Evidence

Evidence Before The Court

Accordingly, I will set aside those subpoenas.EXPERT EVIDENCE The husband wishes to adduce evidence from an expert valuer to value B Company. That is opposed by the applicant. As already set out, the court previously appointed a single expert to value B Company. That order was set aside and Ms Cornish was permitted to adduce evidence from her own expert witness as to the valuation of the corporate entities. Importantly, that means there is no order for the appointment of a single expert. Thus rule 7.08 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) – preventing a party from adducing evidence from another expert witness on the same issue without the court’s permission – has no application. It follows that the matters set out in rule 7.08(2) about which the court should be satisfied in order to exercise its discretion and permit another expert witness where there is already evidence from a single expert are not matters applicable to the extant matter. Rather, the husband’s application is made pursuant to rules 7.10 and 7.11. The husband has not complied with rule 7.11(1). There is no Application in a Proceeding seeking orders to that effect. Rather, an oral application was made on 14 March 2023. I note the husband’s affidavit filed on 13 March 2023 deals with most of the relevant matters as set out in rule 7.11(2). The husband deposed he has instructed Mr AM (“Mr AM”), of ZZ Group to complete a valuation of B Company. He has set out Mr AM’s qualifications in conducting forensic accounting, and preparing business valuations for family law proceedings. He said Mr AM is able to complete a valuation within seven days. He advised the applicant’s solicitors of his application to have Mr AM prepare a valuation in November 2022. On 28 February 2023 he wrote to the applicant’s solicitors regarding the need for the valuers to confer. The husband – and Mr AM – have not confirmed whether there is any previous connection between Mr AM and the husband. Rule 7.11(3) sets out that in determining whether to permit the husband to rely on a valuation prepared by Mr AM, I can take into account:(a) the purpose of this Part (see rule 7.02); (b)the impact of the appointment of an expert witness on the costs of the proceeding; (c) the likelihood of the appointment expediting or delaying the proceeding; (d) the complexity of the issues in the proceeding; (e)whether the evidence should be given by a single expert witness rather than an expert witness appointed by one party only; (f)whether the expert witness has specialised knowledge, based on the person’s training, study or experience: (i) relevant to the issue on which evidence is to be given; and (ii) appropriate to the value, complexity and importance of the proceeding. Rule 7.02 sets out the purpose of this part as: (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 proceeding; (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;(e)to enable a party to apply for permission to tender a report or adduce evidence from an expert witness appointed by that party, if that is necessary in the interests of justice.

Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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