Giacobetti & Giacobetti (No 2)
[2023] FedCFamC1F 1091
•7 November 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Giacobetti & Giacobetti (No 2) [2023] FedCFamC1F 1091
File number(s): SYC 5998 of 2021 Judgment of: CURRAN J Date of judgment: 7 November 2023 Catchwords: FAMILY LAW – PRACTICE & PROCEDURE – Interim Hearing – Expert Evidence – Application to rely on further expert evidence as to the value of a real property where a single expert witness has been appointed to opine on that matter – Where the Court is not satisfied that any matters identified in r 7.08(2) of the Rules apply – Whether the valuers adopt a differing or alternative methodology – Where both experts adopt a comparable sales methodology in valuing the subject property – Where the experts rely on different properties – Where there are differences between the experts in what they consider to be directly comparable sales – Where the wife did not seek clarification of the report pursuant to the Rules – Where the proposed adversarial expert did not have a substantial body of opinion – Where the difference in value itself is not a special reason as identified by the rule to ground leave to adduce evidence from an adversarial expert – Where after consideration of all relevant matters the application is refused – Application dismissed Legislation: Family Law Act 1975 (Cth) s 79
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) pt 7.1, div 7.1.6, rr 7.02, 7.08, 7.25, 7.26
Cases cited: Aon Risk Services v Australian National University (2009) 239 CLR 175
Artinos & Artinos (No 6) [2023] FedCFamC1F 652
Bass & Bass (2008) FLC 93-366
Commonwealth v Milledge (1953) 90 CLR 157; [1953] HCA 6
Lambard & Lambard (No. 4) [2021] FamCA 47
Moretto & Cosola [2022] FedCFamC1F 433
Neales & Neales (2022) FLC 94-079; [2022] FedCFamC1A 41
Salmon and Ors & Salmon [2020] FamCAFC 134
Simonsen & Simonsen [2009] FamCA 698
State of Queensland & Anor v JL Holdings Pty Limited (1997) 189 CLR 146
Tsoutsouvas & Tsoutsouvas and Ors [2012] FamCA 521
Division: Division 1 First Instance Number of paragraphs: 74 Date of hearing: 6 November 2023 Place: Sydney Counsel for the Applicant: Mr Harper Solicitor for the Applicant: Uther Webster & Evans Counsel for the Respondent: Ms Dart Solicitor for the Respondent: Newnhams Solicitors ORDERS
SYC 5998 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS GIACOBETTI
Applicant
AND: MR GIACOBETTI
Respondent
ORDER MADE BY:
CURRAN J
DATE OF ORDER:
7 NOVEMBER 2023
THE COURT ORDERS THAT:
1.The Application in a Proceeding filed 20 October 2023 is dismissed.
2.The husband’s costs of an incidental to the Application in a Proceeding filed 20 October 2023 are reserved.
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 Giacobetti & Giacobetti has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE
REASONS FOR JUDGMENTCURRAN J:
These reasons for judgment were delivered orally and have been corrected from the transcript.
INTRODUCTION
By Application in a Proceeding filed on 20 October 2023 (“the application”), the applicant wife seeks leave to adduce adversarial evidence from Mr C from E Real Estate, a certified practising valuer (“the adversarial expert”), as to the market value of a property at F Street, Town G (“the property”) of which the husband holds a one third interest in, pursuant to r 7.08 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”).
By Response to Application in a Proceeding filed on 3 November 2023, the respondent husband seeks the dismissal of the wife’s application.
The property has been valued by Mr H of J Valuers, a certified practising valuer, who is the jointly appointed single expert (“the single expert”). He had valued the property at $3.1 million on 31 January 2022 and more recently valued the property in the sum of $2.3 million on 20 June 2023. The valuation reports are annexed to the husband’s affidavit filed on 3 November 2023 at annexures 1 and 2.
In short, the single expert opined that the value of the property had reduced from $3.1 million in January 2022 to 2.3 million in June 2023, a decrease the wife contends is of 25.8 per cent, also being a decrease in the husband’s one third interest of, the wife contends, $266,664. The affidavit of Daniel Bennett relied upon in the application deposed that the difference in the husband’s interest as a percentage of the pool contended by the husband reduced from 62.3 per cent to 46.2 per cent. It should, however, be noted that there are disputes in respect of other aspects of the pool, subject to my earlier decision on 19 September 2023 to vacate the hearing date that was allocated to enable certain shares to be valued.
After receipt of the updated report the wife did not seek clarification of the report as she was entitled to pursuant to Division 7.1.6 of the Rules. The reason proffered was there would have been no utility in asking the expert about the correct methodology. For the reasons that follow, I do not accept that submission. Questions could have been put in respect of what is now contended to be a difference in methodology.
The Application in a Proceeding and the Response came before me yesterday, 6 November 2023, some six weeks ahead of the listing date for the trial.
Rule 7.02 of the Rules provides that the purpose of Pt 7.1, dealing with experts, is 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 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.
See also paragraphs 3.14(d) and 5.12(b) of the Court’s Family Law Case Management Central Practice Direction.
In Tsoutsouvas & Tsoutsouvas and Ors [2012] FamCA 521 (“Tsoutsouvas”) at [26], Kent J described the purpose of the single expert rules being to avoid a “battle of the experts.” This and other authorities including Bass & Bass (2008) FLC 93-366 (“Bass”) and Salmon and Ors & Salmon [2020] FamCAFC 134, refer to the capacity to put clarifying questions before seeking the appointment of an adversarial expert and that such procedures should be used.
Rule 7.08 of the Rules relevantly provides:
(1)If a single expert witness has been appointed to prepare a report or give evidence in relation to an issue, a party must not tender a report or adduce evidence from another expert witness on the same issue without the court’s permission.
(2)The court may allow a party to tender a report or adduce evidence from another expert witness on the same issue if it is satisfied that:
(a)there is a substantial body of opinion contrary to any opinion given by the single expert witness and the contrary opinion is or may be necessary for determining the issue; or
(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.
The wife contends that 7.08(2)(a) and (c) are engaged as there is a substantial body of opinion contrary to the opinion given by the single expert and that the opinion is or may be necessary for determining the issue, and secondly, she contends there is also special reason for adducing evidence from the other expert.
In oral submissions and in the Case Outline counsel for the wife contended firstly, that although both used a direct comparison model that they have used different valuation methodologies in that “a proper reading of both reports reveals a fundamental difference of opinion between the valuers as to how that methodology should be implemented when valuing a property such as this”; thus engaging r 7.08(2)(a). Secondly, it was contended that the combination of three identified factors cumulatively constitute a special reason for adducing the evidence such that r 7.08(2)(c) is engaged. Those three factors being: the significant drop in value between the two reports; the magnitude of the difference as a proportion in the asset pool; and the matters of differing methodology (or difference of view as to the way in which a direct comparison model should be applied to this type of property).
THE WIFE DID NOT SEEK TO PUT CLARIFYING QUESTIONS OR CONFER AS OPEN ON THE RULES
It is not in contest that the wife did not seek to put clarifying questions or request a conference with the expert pursuant to r 7.25 and 7.26. Her position is that it would have had no utility.
The husband’s position is that this approach presupposes the answers. I agree.
The wife had the opportunity to put questions to the single expert which she did not do. In fact, the first report from January 2022 applied the identical methodology and was not subject to any query. The question as to methodology only arose after the updated report, applying the same methodology, was obtained. The only matter of difference between the two reports of any substance was the dollar per metres squared amount that had decreased which was applied to the valuations.
The fact is that the wife had the opportunity to put questions, which she did not do. The approach of it being futile was said to presuppose the answers. The single expert was not given the opportunity to clarify factors relied upon such as, for example, the weight given to the dollar per metres squared value.
The questions that could have been put but were not could include:
(a)Whether there is a category of properties called rural lifestyle properties, and if so, should they be valued differently?
(b)Whether there was a different approach or methodology used in valuing what may be referred to as “rural lifestyle properties”?
(c)A contention that properties like the subject property are not “sold or valued on a rate per hectare but are sold on a whole property basis”.
(d)Whether the single expert failed to value the property on a whole property basis?
The issue in relation to valuing the property on a “whole property basis” was certainly not raised between the first valuation and the update, where the only aspect of the report that has changed it seems is the dollar value per metres squared rate that was applied. The methodology used did not change. The rate per metres squared which did change was identified as changing for the reasons set out in the report, including the cash rate and issues like the COVID-19 pandemic.
As identified by Kent J in Tsoutsouvas at [17]:
A number of cases highlight the need to address questions to a single expert or to take the steps provided for in the Rules (such as a conference) to clarify a single expert report before embarking upon an application to be allowed to adduce evidence from another expert witness.
In this regard, his Honour referred to the decisions of Bass and Simonsen & Simonsen [2009] FamCA 698 (“Simonson”).
Kent J also repeated (as identified by the High Court of Australia in both Aon RiskServices v Australian National University (2009) 239 CLR 175 and State of Queensland & Anor v JL Holdings Pty Limited (1997) 189 CLR 146) that there are other factors to be taken into account in the administration of justice such as the timely disposal of proceedings, obligations to other litigants, and the importance of case management procedures, which in this case were not exercised.
IS THIS FAILURE FATAL TO THE APPLICATION?
The failure to utilise the options available, however, is not fatal to the application. It is one relevant factor in considering the application and determining whether the justice of the case should permit the adversarial expert to be relied upon.
IS THERE IS A SUBSTANTIAL BODY OF OPINION CONTRARY TO ANY OPINION GIVEN BY THE SINGLE EXPERT WITNESS AND THE CONTRARY OPINION IS OR MAY BE NECESSARY FOR DETERMINING THE ISSUE?
It was submitted that the proposed evidence is directly adversarial as it expresses different conclusions of value from that reached by the single expert. It was contended on behalf of the wife that Mr C’s evidence should be accepted on the basis of r 7.08 (2)(a) of the Rules; namely, that there is a substantial body of opinion contrary to any opinion given by the single expert and the contrary opinion is or may be necessary for determining the issue.
In support of this submission, counsel for the wife put forward what he contended were the fundamental differences in three paragraphs being the rationale at page 9 of the first report of the single expert, the rationale at page 11 of the second report of the single expert, and point 6.1 on page 22 of the adversarial expert’s report. Those three passages were identified in the wife’s Case Outline Document.
The affidavit of Daniel Bennett was relied upon in support of the application to adduce the additional expert evidence.
Relevantly, the purpose of the Rules is to ensure that parties obtain expert evidence only in relation to a significant issue in dispute; to restrict expert evidence to that which is necessary to resolve or determine the case; to ensure that, if practicable and without compromising the interests of justice, expert evidence is given on an issue by a single expert witness; to avoid unnecessary costs arising from the appointment of more than one expert witness; and to enable the parties to apply for permission to tender a report or adduce evidence of an expert witness appointed by that party if that is necessary in the interests of justice.
As confirmed by the Full Court in Neales & Neales (2022) 64 Fam LR 592 (“Neales”) at paragraphs [52]-[53], and articulated the Full Court in Salmon and Ors & Salmon [2020] FamCAFC 134 at [35] as follows, the “body of opinion” must refer to more than a contrary expression of opinion as to value no matter how substantially contrary:
… The mere expression of an opinion as to value by another expert, no matter how substantially contrary it is to that of the single expert, does not in and of itself constitute “a substantial body of opinion” within the meaning of the rule. If such a contrary opinion is founded upon identified and accepted methodology recognised within the field, or some identified and recognised field of expertise different to that founding the single expert opinion, then the requirement of “a substantial body of opinion” will be fulfilled. As the Full Court observed in Chick and Chick, an expert witness may refer to textbooks and other published material to support his or her material without being forced to call the author for cross-examination. It is to be considered as one of the bases upon which the expert has formed his or her opinion.
(footnotes omitted)
It was conceded that there are unlikely to be published papers in respect of the differences in this case between the experts. I cannot accept that there is evidence before me of a substantial body of opinion, even accepting the limited context of this case and giving the word “substantial” meaning in the context of these facts.
Neither the adversarial report nor the evidence read in support of the application provides any evidence of a “substantial body of opinion contrary to any opinion given by the single expert witness”, and thus, is not admissible under that rule on that ground and it would not be an appropriate exercise of discretion to admit it under that rule.
IS THERE “ANOTHER SPECIAL REASON FOR ADDUCING EVIDENCE FROM ANOTHER EXPERT WITNESS”?
The wife contended that the combination of three identified factors, cumulatively constitute a special reason for adducing the evidence under r 7.08(2)(c). Those three factors, being the significant drop in value between the two reports, the magnitude of the difference as a proportion in the asset pool, and the matters of differing methodology (or difference of view as to the way in which a direct comparison model should be applied to this type of property) were cited.
As identified by counsel for the husband in her Case Outline at paragraphs 11(a)-11(c), the determination of whether there is another special reason for adducing evidence from another expert witness has been considered in a number of authorities. In Simonsen, Murphy J, in considering the Full Court decision in Bass, held that the word “special” has real meaning, and that evidence from any expert is “not something which ought occur in the usual course, or simply by application made by a party.” His Honour then went on to make further comment in relation to the (then) Rules:
13.It is important to understand that Part 15.5 of the Rules does not preclude a party from obtaining on their own behalf expert evidence, nor does it preclude a party from obtaining such expert evidence, (including from more than one expert, should they so choose), in respect of all matters relevant to the proceedings before a court, and all matters relevant to a report and/or evidence produced by a single expert.
14.Thus, expert evidence obtained by a party on their own account can be used, for example, to significantly inform the cross-examination of a single expert witness at a trial. The restriction inherent in the rules is a restriction related to the adducing of evidence from the expert or experts retained by a party.
McClelland DCJ also considered the application of the Rules (by reference to the provisions in the former rules) in Lambard & Lambard (No.4) [2021] FamCA 47, where his Honour said at [14], “I construe the word “special” as requiring a reason which is more than “the ordinary.”
In Dovgan & Dovgan [2021] FamCA 306, Harper J held that different or contrary opinion based on the same methodology would not constitute another special reason. At [175] his Honour stated that “competing valuations of real property are frequent, if not routine” and that a “different or contrary opinion based on the same methodology would not constitute ‘another special reason’”.
In Neales at [30]-[32], the Full Court said:
30.Ground 1.2 as expanded through the Summary of Argument asserted that the primary judge failed to give reasons as to how the husband would be able to challenge the expert evidence other than through cross-examination, and failed to deal with the procedural difficulties the husband would face in the absence of an adversarial expert.
31.This contention presupposes that a trial judge accepts without question, in the absence of other expert evidence, the opinion of a single expert. As the Full Court in Georgeson and Georgeson (1995) FLC 92-618 reminds at 82,218–82,219:
Expert evidence may be adduced as to the proper method to be adopted, in the circumstances of a particular case, to assist the Court in forming an independent judgment on the issue of valuation by the application of the appropriate principles. Whilst an expert may thus suggest an approach as being appropriate in a particular case, before accepting it, the Court must come to its own conclusions as to whether that approach is appropriate in the circumstances.
32.The Court informs its conclusion as a consequence in part of the testing of the evidence. Such is the art of advocacy.
The question there is, is the fact that the value was well outside the range found by the single expert, being contended to be a 25.8 per cent reduction in value sufficient to constitute another special reason as required by the rules – or in other words, is the significant drop in value and magnitude of the difference between the second single expert report and adversarial report another special reason?
In Moretto & Cosola [2022] FedCFamC1F 433 (“Moretto”) Riethmuller J considers the application of the single expert rule. He identified, at [9], that a significant valuation issue can be largely foreclosed on a practical level when the rule was intended to avoid “protracted hearings involving multiple experts where the nature of the dispute is disproportionate to the costs involved.”
Riethmuller J expressed the view at [15] that, “where the value contended by the party challenging the single expert is outside of the range identified by the single expert … the interests of justice would tend to weigh in favour of allowing evidence from the other expert.”
In Artinos & Artinos (No 6) [2023] FedCFamC1F 652, Strum J concluded that when a party challenging a single expert is outside of the range identified by the single expert, the interests of justice may tend to favour allowing evidence from another expert when such a disparity in values exists. In his Honour’s decision at [29] he considered the decision of Riethmuller J Moretto and concluded:
… I respectfully do not agree with that formulation. So formulated, the test postulated by his Honour might be said to fetter the breadth of the discretion under r 7.08(2). Rather, in my view, where there is such a disparity in values, the interests of justice may (rather than would) tend to weigh in favour of allowing evidence from the other expert.
I respectfully adopt the approach of Strum J. I consider that the significant differential is a factor that may favour allowing evidence from another expert, however in this case, I conclude that that issue can be examined through cross-examination, particularly when the original value was $3.1 million and the single expert explains in his updating report the basis for the reduced value. When tested in cross-examination, the differential or magnitude may not be maintained and may not be accepted by the court. It is not a reason in this case for admitting an adversarial witness.
IS THE RISK OF “NO EVIDENCE” AS CONTENDED BY THE WIFE TO VALUE AT THE TRIAL ANOTHER SPECIAL REASON?
The wife submitted that there was a risk that, in the event there was a testing of Mr H’s evidence alone as the single expert, and the Court was then unable to accept it, there would be no value ascribed to the property for the purposes of the dispute under s 79 of the Family Law Act 1975 (Cth) (“the Act”), hence the evidence of Mr C ought to be available for that purpose.
I do not accept that contention.
It is not simply a matter for the Court to accept Mr H’s contested opinion, nor for Mr H to determine the value of the property as a finding of fact in a determination pursuant to s 79 of the Act. It is for the Court to determine, being free to form its own view as to the value of the property, having regard to all of the evidence, by the proper application of established principles of valuation (see Commonwealth v Milledge (1953) 90 CLR 157).
I have also taken into account the husband owns a one third share and the sale of his share has more complexity than if it were owned solely by the husband.
WHETHER THERE WAS A DIFFERENT METHODOLOGY USED?
The question as to whether there in fact is a different methodology used, as contended by the wife, is one that needs to be considered.
Consistent with what the Full Court said in Neales, a significant difference in the value of a subject real property does not, of itself, warrant leave being granted to adduce evidence from another expert pursuant to the Rules on the same subject matter. The Full Court in that decision identified that, in circumstances where a difference in methodology and/or a difference in information is available, that circumstance, in combination with a difference in value, may be another special reason to adduce evidence from an expert other than the single expert.
The wife contended that although both used a direct comparison models that they have used different valuation methodologies, in that “a proper reading of both reports reveals a fundamental difference of opinion between the valuers as to how that methodology should be implemented when valuing a property such as this.”
A careful analysis of the single expert reports and the adversarial report, in my view, exposes that both experts use a comparable sales methodology to ground their opinion as to the value of the property. There are, however, differences in the application of the comparable sales methodology, but differences in weighing the factors identified as significant in expressing their opinion does not amount to a different methodology.
The experts have, for example, referred to different properties they considered comparable. For example, the single expert relies upon the sales of two properties on the same street as the property, due to their location regarding the property, but the adversarial expert opines they are not appropriate for comparison purposes. This, in my view, is a difference of opinion not of methodology.
Importantly the adversarial expert says at page 22:
The direct comparison method involves an analysis of the available comparable sales evidence examining how each sale relates to the subject property. Rural lifestyle properties such as the subject and the included sales evidence are not sold or valued on a rate per hectare basis, these are sold on a whole property basis as most are occupied as small rural homesites. As illustrated by the sales evidence, the rates per hectare vary greatly dependant on the quality of the improvements upon the site, the views available from the property and the location of the property in terms of its proximity to town centres. The rates per hectare have been included for the readers interest only, although these rates have not been used as a reference point to determine the value of the property.
This paragraph is in fact the crux for the basis for the application. This argument would have been persuasive had the single expert relied only, or primarily, on the dollars per square metre rate for the conclusions reached.
The single expert, at page 10, identifies the valuation rationale, and states:
In providing out assessment of the subject property, regard has been given to the following relevant factors:
•The location of the property and surrounding land uses;
•The area of the land, its configuration and topographical features;
•The zoning of the land;
•The availability of utility services;
•The age, construction and conditions of improvements;
•The functional design and utility of the improvements;
•The available comparable sales evidence within reasonable proximity; and
•The general state of the local residential real estate market today with particular regard to demand which exists for residential premises of this nature within the [Town G] locality.
To conclude that the single expert has applied a different methodology when reading the whole of the report, the multiple considerations identified and taken into account, the comparable properties and observations made of the unique nature of the subject property, and the rationale expressed, it is not open. That the experts have possibly given different weight to the dollars per square metre value, or per hectare value, in combination with other factors is something that could have been explored in clarifying questions (and was not), and is something that can be tested, in my view, in cross-examination.
Overall, there is some difference between the properties that each valuer refers to and different weight that each expert attaches to the relevant factors for direct comparisons to the property. However, when the whole valuation is read, each expert applies a comparable sales methodology in the determination of their opinion as to the value of the subject property.
Importantly, to my mind, the experts have no significant differences over the description and details of the property. They both identify that the property's attributes are unique and that there are limited recent direct comparable sales underscoring each of their respective opinions. Both also identify external factors such as the cash rate and the slowing of the market post‑COVID‑19 pandemic, and market changes that they both used for comparison purposes.
IS IT REASONABLE TO INFER THAT HIS OPINION IS SIGNIFICANTLY BASED UPON AN ANALYSIS OF THE RATE PER SQUARE METRE?
Counsel for the wife contended that the valuers have in fact used different valuation methodologies and contended that it is reasonable to infer that the opinion is significantly based upon such an analysis.
The first single expert report was prepared 31 January 2022. The valuation rationale was identified at page 8.
The direct comparison approach was used, and the valuer identified and provided a summary of five comparable properties which referenced sale price, including the rate per square metres of land value, but also identified year of build, views, condition, improvements, and inclusions.
Each comparable property had a comparison analysis of location, land, improvements, presentation, and overall comparison. The valuation rationale on page 9 provided an overall valuation reflective of the dollars per square metres rate which it used, and it concluded “lies within the sales evidence range.” There was no application in response to the use of that methodology for an adversarial expert.
The second single expert report was prepared 20 June 2023. The valuation rationale was identified at page 10 and was identical to rationale applied in the earlier report. The direct comparison approach was used, and the valuer again identified and provided a summary of five comparable properties which had been sold between July 2022 and June 2023 which referenced sale price, including the rate per metres squared land value, but again, also identified year of build, views, condition, improvements, and inclusions.
Each comparable property had a comparison analysis of location, land, improvements, presentation, and an overall comparison. The valuation rationale on page 11 provided an overall valuation reflective of the dollars per metres squared rate, which it concluded that the subject property “sits above the sales evidence range. This is reflective of the subject property compared to the majority of the sales evidence, coupled with the location and historical features of the improvements, generally reflects a higher rate per square metre.”
The RISK analysis used a SWOT to detail the strengths, weaknesses, opportunities, and threats.
While the opinion is based on an analysis of the dollar rate per metres squared, it is also based on the identified factors referred to in the report. It is reasonable to infer that the metres squared rate was arrived at after consideration of all of the factors identified in the rationale of the original and updating reports.
Accordingly, I find that it is not open to infer that the opinion is significantly based on the metres squared analysis. Indeed, it was open to the wife to raise in her clarifying questions with the single expert under the Rules as to what factors the opinion was based on rather than now speculating.
WHAT WAS THE PROPOSED ADVERSARIAL EXPERT’S METHODOLOGY?
The wife contends that the approach of the single expert was “expressly rejected” by the proposed adversarial expert at the 5th paragraph on page 22, where it is stated that:
The direct comparison method involves an analysis of the available comparable sales evidence examining how each sale relates to the subject property. Rural lifestyle properties such as the subject and the included sales evidence are not sold or valued on a rate per hectare basis, these are sold on a whole property basis as most are occupied as small rural homesites. As illustrated by the sales evidence, the rates per hectare vary greatly dependant on the quality of the improvements upon the site, the views available from the property and the location of the property in terms of its proximity to town centres. The rates per hectare have been included for the readers interest only, although these rates have not been used as a reference point to determine the value of the property.
The methodology applied by the adversarial expert is described as “direct comparison method with summation used as secondary or check method.”
Factors relied upon by the proposed adversarial expert were identified such as quality of improvements, and the views available from the property and the location in terms of its proximity to town centres. However, when undertaking a comparison of the factors identified in part 5 titled “sales evidence”, the factors considered included year of build, improvements, size, features, cost per hectare, and comparison to the subject property. These factors are similar to those identified in the single expert reports, although not identical.
There are some obvious differences between the single expert report and that of the adversarial expert. The adversarial expert has included a local market overview at page 17, which identified two properties on the same street as the property, which he considered to be inferior and not worthwhile comparable sales. As stated above, these are differences of opinion, not differences of methodology.
CONCLUSION
Having considered each factor, including the difference in value, the drop in value and magnitude of the change together with the differences in each expert’s application of the direct comparison methodology, and also having considered the 1/3 interest held by the husband, and having had regard to the evidence relied upon, there appears no basis for the wife to fall within the categories of discretions outlined by way of r 7.08(2) of the Rules.
In the present case, the areas where the experts differ can be the subject of cross-examination of the single expert by counsel for the wife at trial, informed by the other expert’s report, as Murphy J observed in Simonsen.
The wife will have the opportunity by way of cross-examination to attempt to test, and to obtain a shift, in the single expert’s opinion grounded from the matters identified in her expert’s report. In the course of cross-examination, the wife can put to the expert each of the additional property sales identified by Mr C and can test the single expert’s foundations for his opinion grounded from his other comparable sales and contest the weight that he gives them.
In all the circumstances, I am also not satisfied that, as required by r 7.08(2)(c), there is a special reason for adducing evidence from the other expert.
After considering each of the matters identified individually and cumulatively, for the reasons identified, it is in the interests of justice and consistent with the intention of the Rules, the wife’s Application in a Proceeding be dismissed.
Costs of this application are reserved to the trial.
I certify that the preceding seventy-four (74) numbered paragraphs are a true copy of the Ex Tempore Reasons for Judgment of the Honourable Justice Curran. Associate:
Dated: 15 December 2023
10
2