Esparza & Esparza (No 2)
[2025] FedCFamC2F 509
•23 April 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Esparza & Esparza (No 2) [2025] FedCFamC2F 509
File number(s): NCC 3537 of 2020 Judgment of: JUDGE SUTHERS Date of judgment: 23 April 2025 Catchwords: FAMILY LAW- property- interlocutory hearing -where dispute as to whether material provided to single expert witness should be considered – dispute concerning two ‘classes’ of document – applicant to bear onus of informing single expert witness - spontaneous oral applications for disclosure found to be procedurally unfair - costs reserved Legislation: Evidence Act 1995 (Cth) s 55
Family Law Act 1975 (Cth) Part VIII
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Chapter 6, rr 6.01, 6.02, 6.06, 6.17, 6.42, 7.19
Cases cited: Ewart v Royds (1954) 72 WN (NSW) 58
Frigger v Trenfield (No 8) [2021] FCA 569
Suzlon Energy Ltd v Bangad (No 2) [2011] FCA 1152; (2011) 198 FCR 1
Division: Division 2 Family Law Number of paragraphs: 39 Date of hearing: 17 April 2025 Place: Newcastle Solicitor for the Applicant Powe & White Family Lawyers Counsel for the Respondent Mr Duane Solicitor for the Respondent Priest Legal ORDERS
NCC 3537 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS ESPARZA
ApplicantAND: MR ESPARZA
Respondent
ORDER MADE BY:
JUDGE SUTHERS
DATE OF ORDER:
23 APRIL 2025
THE COURT DIRECTS THAT:
1.The spontaneous oral applications of both parties for directions to be made to address the other party’s alleged non-disclosure are dismissed.
2.At their cost, the applicant is to forthwith notify Ms B (‘the single expert witness’) that the four-page correspondence from C Pty Ltd addressed to “To Whom in (sic) may concern” and dated 26 July 2021 is not permitted to be read and/or to be considered by the single expert witness for the purposes of producing their prospective expert report.
3.At their cost, the applicant is to do all acts and things and sign all necessary documents to have the single expert witness forthwith remove and destroy the above document from the Client Portal to which the parties and the single expert witness have access to.
4.At their cost, the applicant is to forthwith provide a copy of these directions to the single expert witness.
5.Each party’s costs of the interlocutory hearing on 17 April 2025 are reserved for determination after finalisation of the substantive proceeding.
6.The competing written and/or interlocutory applications of both parties are otherwise dismissed.
THE COURT NOTES THAT:
A.The three-day trial is confirmed to commence at 10:00am on Monday 12 May 2025.
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).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of 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 a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE SUTHERS
INTRODUCTION
This is the second judgment I have delivered in this financial dispute in less than four (4) weeks. It comes just before a trial which is expected to end years of litigation over whether property settlement consent orders made over four (4) years ago should be varied, set aside or confirmed. The latest kerfuffle is over what documents a single expert witness should consider in the preparation of a report for use at the trial. Where do the interests of justice lie?
Out of respect for each person’s gender and social status, other than parties, persons will be identified by their surnames and where applicable there will be an avoidance of the use of gendered pronouns.
These proceedings involve a financial dispute invoking Part VIII of the Family Law Act 1975 (Cth) (‘the Act’) between the applicant, Ms Esparza and the respondent, Mr Esparza.
Unless otherwise specified, legislative references are to the Act and references to subordinate legislation are to the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (‘the Rules’).
The issue in dispute was whether one or both classes of documents sent by Ms Esparza to Ms B (‘the single expert witness’) should be removed from consideration for the purposes of that expert’s report(s).
Mr Esparza proposed that both classes be removed and Ms Esparza rejected that proposal. Both parties agreed that the determination of any costs applications should be reserved until after the trial has concluded, noting that the trial is listed for three (3) days commencing 12 May 2025.
The overarching purpose impels all users of the court (including Judges) to conduct the practice and procedure of this jurisdiction in a way that facilitates the just resolution of disputes.
The prescribed duties of expert witnesses are informed by this overarching purpose, and I heard that irrespective of my decision, neither party considered the single expert witness was impugned by what they have or haven’t read of the contentious material provided by Ms Esparza.
Having considered the competing applications, I intend to permit the single expert witness to consider one of the classes of documents, direct the wife (at her sole cost) to instruct the single expert witness to destroy and ignore the other class of documents and to reserve costs until after the trial concludes. Although I did so during the hearing, I will also formally dismiss each party’s oral application about the other party making disclosure.
My reasons for doing so are set out below.
THE EVIDENCE
I have had the benefit of reading two (2) bundles of documents and these were exhibited during the course of the short hearing last week.
The two (2) classes of documents the subject of the skirmish are:
(a)Exhibit 4.1 – Correspondence and attachments from C Pty Ltd addressed “To whom in (sic) may concern” dated 26 July 2021 (four (4) pages) (‘the C Pty Ltd report’); and
(b)Exhibit 4.2 – Email communication between an asserted accountant called “Mr D” and Ms E, an authorised officer of the NSW Rural Assistance Authority (‘the RAA emails’).
THE ISSUES
The first class of document – Review of financial statements
On 2 April 2025 Ms Esparza wrote to the single expert witness with a letter of instruction which was an addendum to the joint letter of instruction sent by the parties months ago. A day later the single expert witness replied with a self-described table called “URGENT Information Required – 3 April 2025” (‘the table of information’).
This exchange was permitted because I made a direction about it on 1 April 2025, and, inferentially via r 7.19 which gives an expert witness the right to request a procedural order be made by the Court to assist in carrying out the functions of the expert witness, including about the asking and answering of questions by the expert witness of the parties.
I draw the inference because if we are all adhering to the overarching purpose, then the Court would only expect to receive a request of the nature set out within r 7.19, if an informal request from the expert witness has not been satisfactorily met.
It was agreed that nowhere in the table of information is there a request for the C Pty Ltd report or a class of document within which that report could comfortably fit.
Instead, I heard a curious contention that it was (essentially) the best that Ms Esparza could do given the alleged non-disclosure by Mr Esparza, premised on allegations that Mr Esparza had failed to comply with either his ongoing duty of disclosure (see rr 6.01 and 6.06) as amplified by any Undertakings as to Disclosure that Mr Esparza may have filed pursuant to r 6.02 as well a failure to produce documents in answer to a Notice to Produce.
Counsel for Mr Esparza also contended that if Ms Esparza wanted an audit, then they will be sorely disappointed, observing that on his assessment, none of the instructions given to the single expert witness could possibly be interpreted in this way. I make no finding one way or the other but have included it so that no one (including Ms Esparza’s counsel who was not present) can be caught by surprise at the trial and then issues of procedural fairness be raised and delay the start of the trial.
I make three (3) points.
Firstly, to provide documents outside the scope of a request made by any expert witness can risk impugning the expert witness which may lead to findings of poor conduct against the provider of the information and ultimately costs or other unintended consequences.
Secondly, the provision of what “looks, sounds and smells” like an expert report commissioned by one party, without notice to or consent of the other party and without disclosure of all of the instructions and communications leading up to and produced during the preparation of the subject report can be highly prejudicial to the administration of justice because the foundations upon which the opinion is based are opaque and yet another expert is being asked to consider the substance of that material as part of the foundations for their opinion. It is simply not fair and not on.
Finally, a Notice to Produce does not create an ongoing obligation to produce, obligations about which are otherwise embedded in earlier provisions of Chapter 6 of the Rules. That said, Note 1 to r 6.17 makes clear that a party who discloses a document under Pt 6 must produce the document at the trial if a Notice to Produce has been served upon them to do so with potentially adverse consequences if the documents are called for before the court and not answered.
Rule 6.42 prescribes various timeframes for one party (‘the issuing party’) to request another party (‘the recipient’) to produce (at the identified court event) specific documents that are in that party’s possession or control. A Notice to Produce is different to a subpoena for production because:
(a)the latter can be issued against a non-party while a Notice is inter partes, and
(b)“answering” the Notice merely requires the documents to be brought to the specified court event but not produced in court unless a “call” is made before the court, whereas answering a subpoena requires the documents to be produced to the court itself and then there is a prescribed release process facilitated by the court to allow the parties access to the produced documents.
In other words, serving a Notice to Produce merely requires the recipient to bring the documents along to court so that they are available if required at the hearing (in other words, a “call” is made in court): Ewart v Royds (1954) 72 WN (NSW) 58 (Roper CJ, Maxwell & Herron JJ).
Although not embedded in the same way as prescribed within the somewhat comparable r 30.28 of the Federal Court Rules 2011 (Cth), it could be argued that a Notice to Produce can be used as a tactical manoeuvre, because if the issuing party is successful in having the decision-maker find that the Notice has been served, a call is made in court and is not answered; then the issuing party may be permitted to use that finding as a foundation for the court to receive secondary evidence to “fill the void” (so to speak). The tactical advantage being, that reception of the secondary evidence is likely to be more favourable to the interests of the issuing party than to the recipient.
Alternatively, as alluded to earlier, there can be other adverse findings made against a recipient who is found not to have complied.
If a party objects to the “call” being made (so to speak) then given the mandatory nature of r 6. 42(2) and by implication Note 1 to r 6.17 - I would expect the recipient to make an application to be excused from compliance: see Suzlon Energy Ltd v Bangad (No 2) [2011] FCA 1152; (2011) 198 FCR 1 at [13]-[14] (Rares J).
To avoid time being wasted on issues of procedural fairness at the specified hearing, I would expect a recipient to put the issuing party on notice about the nature of the objection, for example, that the “call” is an abuse of process for various reasons including such as –
(a)relevance,
(b)no forensic purpose,
(c)wide or oppressive,
(d)not in the recipient’s possession or control,
(e)there being a statutory objection, or
(f)there is some privilege attached to the document or class of documents sought to be produced.
In those circumstances, and to ensure the efficient use of court time on the day of the hearing (and when the documents are sought to be produced), the recipient should file and serve as soon as possible, an application in a proceeding and short affidavit setting out the evidence upon which the relevant finding is sought to be made.
If a “call” is made before the Court and the documents are not produced, and subject to the court making a finding in the face of an objection to production, then Ms Esparza can make the tactical manoeuvre that must flow as a consequence, but only if I am satisfied that whatever was not produced, and the consequential secondary evidence relied upon is ultimately relevant and/or is not an abuse of process: see for example s 55 of the Evidence Act 1995 (Cth); r 6.06 (1), Frigger v Trenfield (No 8) [2021] FCA 569 at [8] (Jackson J);
If documents are produced then I will be very reluctant to allow the timetable for the trial to be interfered with by allowing “time to inspect”. There are other more timely ways in which a party can ask for production of documents which will not interfere with this trial which everyone keeps telling me they want to run and finish next month.
One of the reasons I have put pen to paper about this topic is because I heard that another Notice to Produce has been issued for the trial. I do not want precious court time lost arguing about the effect of a Notice to Produce being answered or not answered.
For the above reasons, the first class of documents are impermissible.
The second class of document – the RAA emails
At item 3.13), the table of information identifies classes of documents which, on a broad reading cover exhibit 4.2. I say broad because superficially who “Mr D” is and why he is writing to the Rural Assistance Authority is not articulated.
On that point, I was informed that “Mr D” is an accountant for Ms Esparza and this was not contentious. Given its apparent import (then and now), the informal manner in which “Mr D” identifies himself (first name only) when communicating with a government authority (about something that as I understand the submissions, his client wanted to know) is a little disturbing. It would have been far easier to understand why the emails were sent to the single expert witness if it was clear on the face of those emails, who “Mr D” was and why he was communicating with the relevant authority.
Perhaps in future communications, any agent of Ms Esparza could better identify who they are (first and last name) and what their motivation and purpose was?
CONCLUSION
Both parties decided to make spontaneous oral applications for disclosure against the other. I declined to entertain either application because it was not procedurally fair. They are both grown-ups with excellent lawyers who should know what each party’s duty of disclosure means and demands (as well as their own professional obligations as officers of the court). “Trial by ambush” will not be tolerated.
While the parties may choose to continue with conduct that others would say is “unbecoming”, I am required to adhere to the overarching purpose and each party’s conduct may well be the subject of adverse findings at future hearings.
For the reasons above, I find that it is in the interests of justice to make the directions at the beginning of this judgment.
I certify that the preceding thirty-nine (39) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Suthers. Associate:
Dated: 23 April 2025
0
2
3