Linton and Clarke and Anor - [2020] FamCA 497

FAMILY COURT OF AUSTRALIA

LINTON & CLARKE AND ANOR

[2020] FamCA 497

FAMILY LAW – PRACTICE AND PROCEDURE – SINGLE EXPERT VALUATIONS – Review of Registrar’s decision to settle two (2) letters of instruction to each of the business valuer and real property valuer to produce retrospective valuations as at 2 December 2013, being the date an Application for Consent Orders was filed by the Wife and the Husband – Where the matter is listed for final hearing August 2020 to hear the substantive Application to vary the consent Orders entered into – Where the Applicant Trustee in Bankruptcy contends that the Wife and Husband did not accurately disclose the value of certain business interests and properties at the time of the Application for Consent Orders was made – Where the Applicant Trustee in Bankruptcy seeks that the date of the retrospective valuations be performed as at 28 December 2013 or, alternatively, 5 February 2014, being the date the Husband responded to a requisition for information from the Court and the date that the consent Orders were made by the Court – Where the Applicant Trustee seeks to provide additional facts and documents to the single expert valuers in addition to those referred to in the letters of instruction settled by the Registrar – Whether there is an absence of evidence of any event, circumstance or phenomena that occurred between 2 December 2013 and the alternate proposed dates that may have impacted upon the value of the businesses and properties – Orders made dismissing the Application in a Case – Supplementary Orders made permitting the Applicant Trustee in Bankruptcy to request the valuers provide a supplementary report addressing valuations at the alternative dates proposed – Supplementary Orders made for the parties to confer and agree on a statement of facts to provide to the valuers and absent agreement for each of the parties to provide a statement of facts, if they so choose.

Family Law Act 1975 (Cth) s 79A
Family Law Rules 2004 (Cth) r 1.04, 15.54(3), 15.54(4)(a), 15.46, 18.08, 18.10

Feiteiro & Feiteiro [2019] FamCA 647
Henley & Henley (2019) FamCA 101
HTW Valuers (Central QLD) Pty Ltd v Astonland Pty Ltd (2004) 217 CLR 640
Owners of Strata Plan 58577 v Banmor Developments Finance Pty Limited and Other [2006] NSWCA 325
Salmon & Salmon [2020] FamCAFC 134

APPLICANT:

Mr Linton

FIRST RESPONDENT:

Ms Clarke

SECOND RESPONDENT

Mr Headley

FILE NUMBER:

SYC

3545

2016

DATE DELIVERED:

19 June 2020

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

McClelland DCJ

HEARING DATE:

By way of written submissions; 16 June 2020.

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Byrne

SOLICITOR FOR THE APPLICANT:

Mills Oakley

SOLICITOR FOR THE FIRST

RESPONDENT:

Mr M E Frances of Watson Mangioni Lawyers Pty Limited

COUNSEL FOR THE SECOND
RESPONDENT:

Mr Johnson

SOLICITOR FOR THE SECOND RESPONDENT:

Jo-Anna F.S. Moy Solicitor

Orders

The Application in a Case filed 29 April 2020 is dismissed.
In addition to the letters to single expert valuers settled by…

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: [2020] FamCA 497
Decision Date: 19 June 2020

CaseChat Overview and Summary

The parties to this proceeding were Mr Linton and Clarke (the Applicant) and Mr Headley (the Respondent), along with an interested party. The dispute concerned an application to set aside Consent Orders pursuant to s 79A of the Family Law Act. The matter came before McClelland DCJ.

The court was required to determine whether to grant the Applicant leave to send further letters to single expert valuers requesting supplementary reports. These reports were to address whether certain events between December 2013 and February 2014 impacted the value of specific businesses and properties, and if so, to provide updated valuations. The court also needed to make orders regarding the provision of agreed or party-generated statements of facts to these valuers.

McClelland DCJ reasoned that allowing the supplementary reports, subject to the Applicant meeting the costs, was appropriate to ensure the valuers had all relevant information to assess the impact of events on business and property values at the specified dates. The court applied the Family Court Rules 2004, specifically rules 15.54(3) and 15.54(4)(a), concerning the provision of statements of fact to single expert valuers. The court ordered that the parties confer within seven days to attempt to reach an agreed statement of facts, and if unsuccessful, each party could provide their own statement, potentially attaching relevant documents.

The application in a case filed on 29 April 2020 was dismissed. The court granted the Applicant leave to send further letters to single expert valuers for supplementary reports on specific businesses and properties, contingent on the Applicant meeting the cost of the additional work. The parties were ordered to confer on an agreed statement of facts for the valuers within seven days, with liberty to provide individual statements if agreement could not be reached.

Orders

Orders of the court

The Application in a Case filed 29 April 2020 is dismissed.

In addition to the letters to single expert valuers settled by the Registrar on 23 April 2020, the Applicant has leave to send:

(a) a further letter to Ms B of C Valuers requesting that, subject to the Applicant meeting the cost of the additional work, she provide a brief supplementary report setting out her opinion as to whether any event, circumstance or phenomena occurred between 2 December 2013 and either or both of 28 December 2013 and 5 February 2014 that impacted upon the value of the following businesses:

(i) "D Business";

(ii) “E Business”;

(iii) "F Business"; and

(iv) "G Business".

and, if so, what value would she place on each of those respective businesses as at that additional date or dates as so requested.

(b) a further letter to Mr H of J Valuers requesting that, subject to the Applicant meeting the cost of the additional work, he provide a brief supplementary report setting out his opinion as to whether any event, circumstance or phenomena occurred between 2 December 2013 and either or both of 28 December 2013 and 5 February 2014 that impacted upon the value of the following properties:

(i) K Street, L Town NSW;

(ii) 2 M Street, Suburb N NSW;

(iii) 4 M Street, Suburb N NSW; and

(iv) O Street, Suburb P NSW.

and, if so, what value would he place on each of the respective real properties as at that additional date or dates as so requested.

That, the parties are to, within seven (7) days, confer with a view to attempting to reach agreement on an agreed statement of facts to be provided to each single expert valuer in accordance with r 15.54(3) of the Family Court Rules 2004 (“the Rules”).

If, within that period of seven (7) days, the parties are unable to reach agreement in respect to an agreed statement of facts then, to the extent that each party so choses, they may provide to each single expert valuer a statement of facts in accordance with r 15.54(4)(a) of the Rules.

To avoid doubt, the statement or statements of fact to be provided to each single expert valuer, in accordance with Order 4, may attach such document or documents that the party or parties, acting reasonably, contend is relevant to the task requested of each valuer.

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

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

In November 2014, there was a final determination made hearing took place and judgment was entered against Mr Headley including an order that he pay compensation to QR in the above proceedings. amount of $2,273,374. On about 23 September 2014, Mr Headley presented a "Debtor's Petition" (Schedule 1, item 8) and "Statement of Affairs" (Schedule 1, item 9). On 24 September 2014, Mr Headley became a bankrupt, with the Official Trustee as the trustee. On 29 October 2014, Mr Linton replaced the Official Trustee, in that bankruptcy, as the trustee. In April 2016, Mr Headley was again made a bankrupt, with the Official Trustee as the trustee. On 24 June 2016, Mr Linton replaced the Official Trustee, in the second bankruptcy, as the trustee. As part of the second bankruptcy, on about 18 April 2016 Mr Headley completed a "Statement of Affairs" (Schedule 1, item 10). On 25 September 2017, Mr Headley was discharged from the first bankruptcy; and, on 19 April 2019, he was discharged from the second bankruptcy. These proceedings were commenced on 7 June 2016, upon Mr Linton filing and serving an "Initiating Application". In the proceedings, Mr Linton seeks an order to have the Consent Orders set aside, pursuant to s 79A of the Family Law Act. In the Disclosure Document, Mr Headley stated in relation to the D Business:Sole proprietorship commenced in 1994. My main consulting business, providing … services. At the items in Schedule 1 indicated below are copies of the following documents relating to the D Business: In May 2014, pursuant to a "Contract for sale of business" (Schedule 1, item 14), Mr Headley sold D Business and E Business to the company D Pty Ltd as trustee for the D Discretionary Trust (D Trust) for $150,000. At the items in Schedule 1 indicated below are copies of the following documents relating to D Pty Ltd and the D Trust: Additional information concerning the D Business is contained in various of the documents that are listed in Schedule 1 and referred to in Section B above. In the Disclosure Document, Mr Headley stated in relation to the E Business:Registered business name with myself. Commenced late 2012. Tentative verbal agreement of 55% Mr Headley, 45% Mr U but this is not working out (to discuss. Provides party hire services under franchise arrangement to Sydney metro area. At item 18 in Schedule 1 is an ASIC extract for the business name "E Business". Financial Statements and Profit and Loss Statements for 2013 are available. Additional information concerning the E Business is contained in various of the documents that are listed in Schedule 1 and referred to in Section B above; as well as at [24] above. In the Disclosure Document, Mr Headley stated in relation to the F Business:Originally registered by Mr U (see F2 Pty Ltd below) to run his … business, but taken on by myself in 2009 because W Organisation liked the name for their PR campaigns. Was used to bill … operators for a period but effectively a dead business now. Can lapse.

Ratio Decidendi

Legal Principle Established

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