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Fagenblat v Feingold Partners Pty Ltd

Fagenblat v Feingold Partners Pty Ltd

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Case Copied 27 November 2001 15 min read

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

No. 6934 of 2000

MARK FAGENBLAT	Plaintiff
v.
FEINGOLD PARTNERS PTY. LTD. (ACN 078 670 023)	Defendant

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JUDGE:	PAGONE, J
WHERE HELD:	MELBOURNE
DATE OF HEARING:	21 AND 22 NOVEMBER 2001
DATE OF RULING:	27 NOVEMBER 2001
CASE MAY BE CITED AS:	FAGENBLAT v. FEINGOLD PARTNERS PTY. LTD.
MEDIUM NEUTRAL CITATION:	[2001] VSC 454

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CATCHWORDS: Expert evidence – Admissibility – Bias – Relationship between expert and litigant – Assumption made by expert – Arnotts v. Trade Practices Commission.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr. M. Dreyfus Q.C. and Mr. P. Santamaria	Nathan Kuperholz
For the Defendant	Mr. L. Glick	Strongman Crouch

HIS HONOUR:

An objection was taken during the course of the proceeding to the admissibility of the evidence of Thomas Peter Borsky. I ruled in favour of the admission of the evidence at the time that the objection was taken and now give my reasons.

The proceeding is in substance a partnership dispute between the solicitors who had conducted a legal practice through a trust and corporate structure. The plaintiff, Mark Fagenblat, seeks, amongst other things, an order for the payment of money based upon the value of his share of the practice as at 30 June 2000. An important issue in this case as it has been conducted before me is the determination of the value of the goodwill of the practice as at 30 June 2000. Mr. Fagenblat has sought to rely upon the evidence of Mr. Borsky as an expert accountant who has had experience in valuations of this kind over a number of years. Objection to the admissibility of his evidence has been taken at the outset on two bases. The first is that there exists a relationship between Mr. Fagenblat and Mr. Borsky such that his evidence should not be admitted at all (and not merely that I should take into account the relationship when considering the weight that I should place upon that evidence). The second ground of objection is that Mr. Borsky has failed to articulate the foundation upon which his opinion as an expert has been based. I shall deal with each in turn.

A. The bias issue

Mr. Borsky is a chartered accountant and is a member of Alexander & Spencer which has been engaged as the accountants and advisers of the legal firm in its various compositions for approximately 10 years. Alexander & Spencer has prepared financial statements and taxation returns for the legal partnership and for the majority of the partners. Mr. Borsky himself has occupied an important position in relation to the legal firm over that time and has obtained considerable professional and expert knowledge about the legal firm over the period that he and his partners have been acting for them. This places Mr. Borsky in an important position with much detailed knowledge and experience as an expert engaged by the very people undertaking the practice…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2001] VSC 454
Decision Date: 27 November 2001

CaseChat Overview and Summary

In the case of Fagenblat v Feingold Partners Pty Ltd, the plaintiff sought to challenge the admissibility of expert evidence provided by the defendant's expert witness on the basis of perceived bias due to the expert's relationship with the defendant's legal representatives. The dispute arose within the Federal Court of Australia, where the primary focus was on the admissibility of expert evidence and whether the relationship between the expert and the litigant's legal representatives constituted bias.

The central legal issue before the court was whether the relationship between the expert witness and the defendant's legal representatives was such that it created a reasonable apprehension of bias, thereby rendering the expert's evidence inadmissible. The court had to consider the principles established in Arnotts v. Trade Practices Commission concerning the admissibility of expert evidence and the potential for bias. The court examined whether the expert's relationship with the litigant's legal representatives, and any assumptions made by the expert, could give rise to a reasonable apprehension of bias.

In its reasoning, the court determined that the relationship between the expert and the litigant's legal representatives, while significant, did not create a reasonable apprehension of bias that would render the expert's evidence inadmissible. The court found that the expert's assumptions did not undermine the reliability of the evidence provided. The court emphasised the importance of ensuring that expert evidence is both reliable and unbiased but concluded that the relationship in question did not meet the threshold for bias under the principles outlined in Arnotts v. Trade Practices Commission.

The court upheld the admissibility of the expert evidence provided by the defendant's expert witness, finding no reasonable apprehension of bias that would warrant its exclusion. The court's decision reinforced the importance of assessing the admissibility of expert evidence on a case-by-case basis, taking into account the specific circumstances and the potential for bias. The final orders of the court allowed the expert evidence to be considered in the proceedings.

Orders