O Connor and Islington

[2008] FamCA 48

FAMILY COURT OF AUSTRALIA

O’CONNOR & ISLINGTON [2008] FamCA 48

FAMILY LAW – PROPERTY – Practice and Procedure – Appointment of single expert witness

Family Law Act 1975 (Cth)

APPLICANT: MR O’CONNOR

RESPONDENT: MS ISLINGTON

FILE NUMBER: MLF 1934 of 2006

DATE DELIVERED: 5 FEBRUARY 2008

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: THE HONOURABLE JUSTICE CRONIN

HEARING DATE: 5 FEBRUARY 2008

REPRESENTATION

COUNSEL FOR THE APPLICANT: IN PERSON

SOLICITOR FOR THE APPLICANT:

COUNSEL FOR THE RESPONDENT: MS VOHRA

SOLICITOR FOR THE RESPONDENT:

Orders

1. That Mr S be appointed as the single expert witness to value:

   (a)Q Investments Pty Ltd;

   (b)S Services Pty Ltd;

   (c)O’Connor Family Trust;

   (d)Professional practice of the husband.

2. That each party forthwith upon request do all things necessary and provide all requested documents at the behest of the single expert witness for the purposes of this valuation.

3. That the husband forthwith provide any document referred to in Annexure “A” to the orders made on 15 August 2006 that have not otherwise been available for inspection by virtue of the list referred to in Annexure “TJR11” to the affidavit of Mr T.

4. That the wife have until 4.00pm on 14 February 2008 to provide to the husband a precise list of documents otherwise that she requests the husband to provide for inspection.

5. That by 4.00pm on 28 February 2008, the husband provide to the wife subject to any issue of objection on the grounds of privilege, all documents referred to in paragraph 4 hereof.

6. That the interim applications filed in these proceedings be otherwise dismissed.

7. That the costs of the wife of this day be reserved for determination at final trial.

IT IS CERTIFIED

1. That pursuant to Rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of counsel.

IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Honourable Justice Cronin delivered this day will for all publication and reporting purposes be referred to as O’Connor & Islington.

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 1934  of 2006

MR O’CONNOR

Applicant

And

MS ISLINGTON

Respondent

REASONS FOR JUDGMENT

1. This matter came before me for mention on 5 February 2008.  This is a case which is listed for hearing before me in a few weeks time in March.  According to the file, it is a dispute over both parenting and property matters.  At the conclusion of the mention having regard to the fact that I had to resume a part-heard defended matter, I made orders arising out of the discussions with the parties.  At that time I did not indicate that I was going to give reasons but I do so now in writing.

2. The husband in these proceedings is a lawyer who at the moment is representing himself.  The wife was represented by counsel.

3. The husband had filed an application seeking interim orders in relation to parenting matters and the wife filed an application relating to financial issues including the question of a single expert witness appointment and discovery.  Neither party filed any material in response to the other’s application.

4. At the commencement of the hearing, counsel for the wife indicated that the children’s issues were resolved but minutes had not been prepared nor obviously signed.  The husband was equivocal about whether the matter has resolved.  I indicated in return that I was not prepared to treat the matter as resolved until such time as it was otherwise signed off by the parties.

5. At the conclusion of the hearing, the husband raised the subject of his application and I informed him that I was not prepared to determine the matter.  That was because of the time but also because of the fact that a final hearing is only some weeks away and the parties seemed to be having some meaningful discussions.  Ms Vohra of Counsel indicated that she would have those discussions during the day.  I said that I was prepared to make orders if the parties came to an agreement.  No such agreement appeared to have been reached.  It would be inappropriate in the circumstances when there is a dispute between the parties about what is the agreement for me to embark upon an interim hearing where there is no urgency about the situation and I was told that the husband’s time with the children is in fact taking place.  There was no question argued about the application being an abuse of process but it seems to me inappropriate in circumstances where there was no urgency whilst the final hearing is pending.

6. The issue concerning the single expert witness was rather baffling.  The order for a single expert witness was made in July 2007 and clearly has not been carried out.  The solicitor for the wife filed an affidavit in these proceedings indicating the course of events subsequent to the making of the order.  It is clear that he offered three names of persons who would appear to be forensic accountants.  The husband in correspondence made clear his opposition to the appointment notwithstanding the order had been made.  I was informed that the order had been opposed and the Registrar had ruled.  Notwithstanding that ruling, the husband wrote to the solicitor for the wife saying that he did not see the necessity for the interests to be valued.  Counsel for the wife said that apart from the question of any capital value, an examination of the entities was required to determine the husband’s income position.

7. The husband complained that he had not been provided with details as to the expertise of the nominated persons but at the same time acknowledged that he had done nothing about either proffering names himself nor making inquiries about the expertise of the nominated persons. This situation seems to have lingered for an inordinate period of time and to some extent, the solicitor for the wife could be criticised for not having taken immediate enforcement action so that the order could have been carried out. If there is however degrees of criticism, the bulk of that criticism must lie with the husband who has done nothing about the matter either. He suggested a man who ultimately declined to be involved. He certainly did not follow the steps set out in the Family Law Rules. In discussion with the husband, he indicated to me that the persons named by the solicitor for the wife were forensic accountants and not valuers. The absurdity of this argument ought to be obvious having regard to the fact that corporate entities and trusts were involved in the valuation exercise. He was not able to tell me who would be an appropriate person other than he repeated that it should be a valuer. I do not accept having regard to the fact that the husband is a lawyer that he was serious about that submission.

8. The husband also maintained that there had been delays having regard to his business obligations as a legal practitioner and also the fact that he was suffering from depression as a result of the breakdown of the marriage.  Even allowing for those matters, the response of the husband was not appropriate in addressing the issue. 

9. Accordingly, there being no other proffered nominee, I appointed Mr S as the appropriate single expert and I have made orders for the production of documents.

10. The second issue raised by the wife related to the production of documents.  It was of significant concern to me that in 2006, a handwritten annexure apparently drafted by the solicitor for the wife was appended to orders of a registrar.  In my view, those documents are not only simple but clear.  The husband maintained that he did not know what it was that was expected of him and I do not accept that.  He is a lawyer and would clearly understand what profit and loss statements and balance sheets mean.  In addition, he does not have a qualified accountant looking after those entities under his control and he told me that if necessary, he could produce MYOB records which may not necessarily be entirely consistent with the financial statements normally prepared for the corporate entities but they would give an accurate picture of what the financial positions of the entities were.  Whilst I have some reservations about that explanation, it will no doubt surface again when the single expert witness seeks information.  As I pointed out, the single expert witness is most likely to want profit and loss statements and balance sheets for those entities to determine whether they have any value let alone any income flow. 

11. The husband’s position also was that he had prepared a document attached to an affidavit of documents used by the civil jurisdictions of courts in Australia and he felt that that was adequate in covering all of the things that the solicitor for the wife would need.  He said that the solicitor for the wife had told him that he did not know what documents he wanted.  He maintained that it was up to the wife to request documents.  That argument holds little water having regard to the fact that the husband conceded that to date, he had not produced the MYOB records of these entities. 

12. Whilst I am not in a position to say at this stage that the husband was being obtuse or was failing to be open and frank in respect of disclosure, the pressure will now be on him to provide whatever is necessary to prove not only the value of the entities but also his financial worth both in capital and income terms.  Those matters are not simply rhetorical.  They are very simple and clear. 

13. I have made orders accordingly that the husband provide whatever has not otherwise been provided in the 2006 orders.  To ensure that the wife is equally kept vigilant and sensible about what is relevant, I have ordered that her practitioner provide to the husband by 14 February, a list of what documents she wishes to see.  No doubt that can be prepared with the assistance of the forensic accountant but I remind both parties about the fact that the single expert witness is not to be approached and the Rules will be rigidly enforced. 

14. I have reserved the question of the wife’s costs of the day until the trial.  If there is no cooperation, the provisions of s 117(2A) will be sharply in focus.

I certify that the preceding Fourteen (14) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin

Associate;

Date:  7 February 2007