Persson & Marchand
[2024] FedCFamC1F 758
•12 November 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Persson & Marchand [2024] FedCFamC1F 758
File number: MLC 10930 of 2022 Judgment of: SCHONELL J Date of judgment: 12 November 2024 Catchwords: FAMILY LAW - EXPERT EVIDENCE – Where the wife seeks to adduce adversarial evidence as to the value of farming land and the matrimonial home – Where the husband sought orders to appoint a single expert as to repairs to the roof of the home – Discussion of ‘special reason’ for allowing adversarial evidence – Where there is a special reason for allowing adversarial evidence in addition to the evidence of the jointly appointed single expert – Application to adduce adversarial evidence as to the value of farming land allowed – Application and response otherwise dismissed. Legislation: Federal Circuit and Family Court of Australia Act 2021 (Cth) s 67
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Part 7.1, rr 7.02, 7.08, 7.18
Cases cited: Duffy v McGee [2022] IECA 254
Neales & Neales (2022) FLC 94-079
Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146
Whisprun Pty Ltd v Dixon (2003) 200 ALR 447
Division: Division 1 First Instance Number of paragraphs: 68 Date of hearing: 4 November 2024 Place: Sydney via audiovisual link Counsel for the Applicant: Mr Dickson KC Solicitor for the Applicant: Lander & Rogers Counsel for the Respondent: Ms Vohra SC Solicitor for the Respondent: Kenna Teasdale Lawyers ORDERS
MLC 10930 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS PERSSON
Applicant
AND: MR MARCHAND
Respondent
ORDER MADE BY:
SCHONELL J
DATE OF ORDER:
12 NOVEMBER 2024
THE COURT ORDERS THAT:
1.Pursuant to r 7.08(2) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth), the Applicant have leave to tender a report or adduce evidence from Mr B, Certified Practising Valuer, in relation to the property situate at and known as C Street, Town D, being the whole of the land more particularly described in Certificate of Title Volume … Folio … (Town D property).
2.By consent the parties jointly appoint E Company as a single expert to prepare a report in relation to the timeframe for the Town D property to be included in the town boundary and the timeframe for rezoning and application for subdivision.
3.That the husband and wife jointly appoint a single expert to prepare a written report detailing works required concerning the roof of the building located at F Street, Suburb G and the estimated costs of any works required to repair the roof, at their joint expense.
4.The wife’s Application in a Proceeding filed 30 August 2024 and the husband’s Response filed 18 September 2024 are otherwise dismissed.
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 the pseudonym Persson & Marchand has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
SCHONELL J:
By Application in a Proceeding filed 30 August 2024, the applicant wife (“the wife”) seeks the appointment of what are colloquially referred to as ‘adversarial experts’ in relation to farming land and the matrimonial home.
The parties reached agreement about the appointment of a single expert in respect of the sub‑divisibility of the farming land.
The respondent husband (“the husband”) sought orders to appoint a single expert as to repairs to the roof of the home, but otherwise opposed the wife’s application.
For reasons that will become apparent, I propose to grant leave to the wife to adduce expert evidence expert in relation to the farming land, make orders for appointment of a single expert in relation to the roof and will otherwise dismiss the balance of the application and response.
DOCUMENTS RELIED UPON
The wife relied upon the following documents:
(1)Application in a Proceeding filed 30 August 2024;
(2)Affidavit of Mr H filed 30 August 2024;
(3)Affidavit of Mr J filed 2 September 2024;
(4)Affidavit of Mr K filed 2 September 2024;
(5)Affidavit of Mr L filed 2 September 2024;
(6)Affidavit of Mr B filed 30 August 2024;
(7)Affidavit of Mr B filed 31 October 2024; and
(8)Case Outline filed 31 October 2024.
The husband relied upon the following documents:
(1)Response to Application in a Proceeding filed 18 September 2024;
(2)Affidavit of Mr Marchand filed 18 September 2024;
(3)Affidavit of Mr J filed 2 September 2024;
(4)Affidavit of Mr K filed 2 September 2024; and
(5)Case Outline filed 25 September 2024.
The wife sought the following orders:
1.That pursuant to Rule 7.08(2) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021, the Applicant have leave to tender a report or adduce evidence from the following expert witnesses:
(a)[Mr B], Certified Practising Valuer, in relation to the property situate at and known as [C Street, Town D], being the whole of the land more particularly described in Certificate of Title Volume […] Folio […] ([Town D] property); and
(b)[Mr L], Certified Practising Valuer, in relation to the property situate at and known as [F Street, Suburb G], being the whole of the land more particularly described in Certificate of Title Volume […] Folio […].
2.That the parties jointly appoint [E Company] as a single expert to prepare a report in relation to the timeframe for the [Town D] property to be included in the town boundary and the timeframe for rezoning and application for subdivision.
3.That the Husband pay the Wife's costs of and incidental to this Application.
4.Such further and other interim order or orders as this Honourable Court deems appropriate.
The husband sought the following orders:
1.That the Application in a Proceeding filed 30 August 2024 be dismissed.
2.That the Husband and Wife jointly appoint a single expert to prepare a written report detailing works required concerning the roof of the building located at [F Street, Suburb G] and an estimate of any works required to repair the roof, at their joint expense.
3.Within 14 days of receipt of the written report in paragraph 2 of the Orders, the parties jointly instruct the single expert, [M Company], to prepare an updated valuation of the [F Street] property.
4.That the Applicant Wife pay the Respondent Husband’s costs.
I have read all of the evidence relied upon in the application but do not propose nor is it necessary to repeat all of it or all of the submissions in these reasons (Whisprun Pty Ltd v Dixon (2003) 200 ALR 447).
BACKGROUND
The husband and wife are involved in financial proceedings consequent upon the breakdown of their relationship. The husband contends the pool of assets is approximately $18,000,000 whereas the wife contends the pool is approximately $28,000,000.
The parties are at issue in relation to the value of two pieces of real estate; one being the former matrimonial home at Suburb G in Victoria (“the home”) and the other being farming land of over 30 hectares (there is asserted to be an issue as to the exact size) at Town D in Victoria (“the land”). One of the issues in the proceedings is whether the land will be rezoned and whether it is subdividable. A subset of related issues flow from the answer.
In December 2023, the parties jointly engaged M Company as a single expert to value the two properties. M Company subsequently appointed Mr K to value the land and Mr J to value the home.
Each valuer prepared a report. In January 2024, Mr J valued the home at $4,500,000 and in February 2024, Mr K valued the land on its current market value at $8,000,000 and at a value of between $75,000,000 and $90,000,000 assuming it could be rezoned and subdivided.
Following the release of the reports, the wife submitted questions to each valuer.
In March 2024, Mr K left the offices of M Company and commenced working at N Company as a director of the valuations team.
On 2 April 2024, the wife’s solicitors engaged Mr L of O Company to prepare an adversarial valuation in respect of the home. His report was prepared as at 6 May 2024 and valued the home at $4,150,000.
On 23 April 2024, the wife’s solicitors engaged Mr B of N Company to prepare a critique of Mr K’s report and an adversarial valuation of the land. Following his engagement, Mr B advised the wife’s solicitors that Mr K had commenced employment with N Company. Upon being advised of this fact, the wife’s solicitors by letter dated 26 April 2024 indicated that they wished to proceed, but on the basis that Mr B provide an undertaking in the following terms:
1.That you will not communicate with [Mr K] in relation to this engagement or his engagement to prepare a valuation of the [Town D] property whilst at [M Company] unless jointly authorised by the parties in this matter;
2.You will not access any data, memorandum or correspondence that is in [Mr K’s] possession in relation to the [Town D] property; and
3.That there will be an electronic quarantine precluding [Mr K] from access to all relevant file data for this engagement.
By return letter dated 30 April 2024, Mr B responded that N Company would provide undertakings as follows:
1.We will not communicate with [Mr K] in relation to the present engagement or [Mr K’s] previous engagement to prepare a valuation report on behalf of his former employer ([M Company]) unless jointly authorised by the parties in the Family Law Matters.
2.We will not access any data, memorandum or correspondence in [Mr K’s] possession in relation to the [Town D] property or [Mr K’s] previous engagement regarding this property, noting we have been provided with certain redacted materials by the legal representatives of the parties but nothing directly from [Mr K].
3.We have instituted and will maintain (at least for the duration of the present engagement) an electronic quarantine precluding [Mr K] from access to all relevant file data for this engagement.
Upon the provision of the undertakings, Mr B was engaged. The husband was at that stage ignorant as to the engagement of Mr B.
Mr B valued the land on 22 May 2024 at its current market value at $13,700,000 and at a value of $126,500,000 assuming it could be rezoned and subdivided.
On 27 June 2024, Mr B’s valuation was provided to the husband’s solicitors.
The parties thereafter attended a mediation which was unsuccessful.
On 30 August 2024, the wife filed her Application in a Proceeding seeking leave to tender the reports of Mr B and Mr L.
On 13 September 2024, the husband’s solicitors wrote to the wife’s solicitors objecting to the wife being granted leave contending there was “a clear conflict of interests” (husband’s affidavit filed 18 September 2024, paragraph 6). Thereafter, the parties exchanged correspondence as to the instructions received by Mr B and the extent of any communication between Mr B and Mr K.
The matter was initially listed for hearing on 27 September 2024. In circumstances where the husband sought to cross-examine Mr B, the matter was adjourned.
At the hearing, Mr B was cross examined by King’s counsel for the husband and each party made oral submissions expanding on those in the written outlines.
No party made any application to cross-examine Mr K.
It appears that Mr K remains unaware of the engagement of Mr B or the existence of his report.
EVIDENCE OF MR B
Mr B gave evidence that he commenced working at N Company in 1987 and is a senior executive.
He said that Mr K commenced working for N Company in March 2024 albeit that he is in a separate team to him. His affidavit records:
8.Lander & Rogers have informed me that I am required for cross-examination on 4 November 2024 and that I will likely be cross-examined with respect to my working relationship with [Mr K]. Given [Mr K] is an employee of [N Company], I considered it appropriate to inform [N Company’s] in-house legal team of the foreshadowed cross-examination. Upon being made aware, our in-house legal team determined that it holds a duty of care to [Mr K] to advise [Mr K] of the Wife's application to adduce evidence from me and the nature of the foreshadowed cross-examination on 4 November 2024. As a Board Director of [N Company] I want to ensure that there is no embarrassment or harm caused to [Mr K] as a result of the foreshadowed cross-examination.
9.I am informed and readily believe that Lander & Rogers sent correspondence to Kenna Teasdale on 25 October to advise them of our in-house legal team's determination and a proposed joint letter to [Mr K] was provided. Annexed hereto and marked with the letters "[MB]-3" is a true and correct copy of the correspondence from Lander & Rogers and the proposed joint letter dated 25 October 2024.
10.I am informed and readily believe that as at the date of affirming this affidavit, the Husband's lawyers have not signed the joint letter to [Mr K] to advise him of my involvement. Accordingly, to the best of my knowledge, I understand that [Mr K] remains unaware of my involvement in these proceedings.
11.Should [Mr K] be made aware of my involvement in these proceedings, I confirm that I will not communicate with [Mr K] in relation to the present engagement or [Mr K's] previous engagement to prepare a valuation report except as agreed between the husband and the wife in thse [sic] proceedings or as otherwise ordered by this Honourable Court, and that I will otherwise continue to act in accordance with the undertaking provided on 30 April 2024.
12.I also wish to make the following points in advance of the hearing on 4 November 2024:
(a)[Mr K] and I work in entirely separate teams, and there is no reporting relationship between [Mr K] and me.
(b)I am not involved in any aspect of [Mr K's] supervision. [Mr K] reports to and is supervised by [Mr P].
(c)Whilst I do not supervise [Mr K], my position as a Board Director may require me from time to time to consider career progression and remuneration of [Mr K].
(d)[Mr K] undertakes valuations for [one of our] Practice Group […] and I undertake valuations for [another of our] Practice Group[s].
(e)I have not been involved, and nor do I expect to be involved in preparing any valuations with [Mr K] going forward in circumstances where our teams operate separately. [Mr K], in his role at [N Company], is not involved in preparing any valuations relating to residential subdivision work. The only time there might be some cross‑over would be if a client had a portfolio which required expertise from both the […] Practice Group[s].
(f)I was not involved in [Mr K’s] interview process, nor was I involved in any decision to hire him at [N Company].
(g)There are [over 150] employees at [N Company] with [over 100] employees operating out of our Melbourne office. These numbers include myself and [Mr K].
(h)The commentary I have provided pertains to a valuation report prepared by [Mr K], under the supervision of [Mr Q], whilst employed at [M Company]. It is not commentary on [Mr K] as a person and the type of valuation is not one that [Mr K] will be involved in whilst employed within the […] Practice Group at [N Company].
In the course of his cross-examination, Mr B advised that as soon as he was instructed to prepare a valuation, he raised the issues of a potential conflict of interest. He confirmed that he had not spoken to Mr K about his report or engagement or that he had been retained to prepare a valuation. He confirmed the matters he addressed in his affidavit amounted to a disagreement with Mr K and that Mr K had not used the best comparable sales, that Mr K had made an error in the comparison with green wedge, that there were inconsistencies in the measurements and that Mr K had made a comment as to development that was outside his expertise.
Mr B agreed that he omitted to include all of the documents that formed his instructions and that in hindsight additional documents should have been included. He said he was one of nine members of the board that ratifies promotions and remuneration for staff including Mr K. Mr B did not accept that Mr K would have a difficulty disagreeing with him, saying:
No. I do not see it. That’s his opinion in his report. I have my opinion as to what has been inappropriately done, and the court will determine when it – when – what will happen, but that’s my opinion, and he’s keeping with his.
(Transcript dated 4 November 2024, page 17 lines 3–5)
WIFE’S SUBMISSIONS
In respect of the land, the wife challenges the husband’s characterisation that the valuers have a ‘conflict of interest’. She points to the evidence that they are in different teams, do not have a direct reporting relationship and the construction of arrangements in-house to quarantine information.
In relation to any suggestion that Mr K may perceive to be subordinate to Mr B or unwilling to challenge him, the wife’s Case Outline records:
22.To the extent the husband contends that [Mr K] would feel compromised in arguing the correctness of his opinion in any conference ordered between he and [Mr B] (and presumably in the witness box):
(a)Firstly there is no evidentiary basis for such a contention. [Mr K] is available for the husband to call to give that evidence. He has elected not to do so, and the Court should not make any assumptions as to his state of mind;
(b)Secondly, even if such a contention has any merit, the co-signatory to the Single Expert report, [Mr Q] ([Mr K’s] “Supervising Member” at [M Company]) has indicated a preparedness to confer with [Mr B] if such an order is made; and (c) Thirdly, if indeed [Mr K] were to indicate he is not comfortable to stand by his opinion, and express objective views, for whatever reason (including his change of employer), then he should no longer be considered appropriate as a Single Expert.
(Footnote omitted)
Otherwise, the wife submits that the respective valuations are approximately $5,700,000 apart as to the current market value and approximately $50,000,000 apart at the lower end of the range in the event of a subdivision. The wife submits that she should be permitted to adduce evidence from an adversarial expert in circumstances where:
(a)Mr B is aware of comparable sales not known to Mr K;
(b)Mr K did not compare like with like in that Mr K used “Green Wedge zones land comparable sales as a basis of comparison to assess the value of the northern portion above the ridgeline instead of properties with developmental potential” (wife’s Case Outline filed 31 October 2024, paragraph 8(b));
(c)There are issues in relation to Mr K’s calculation of the land area; and
(d)Mr K’s report is predicated on a series of assumptions which are beyond his expertise.
In respect of the home, the wife submitted that the valuers disagree about the internal and external condition of the home, the number of bedrooms, the appropriateness of comparable sales and the difficulty of vehicular access. The wife contends in her Case Outline as follows:
41.The Wife seeks leave to adduce the evidence of [Mr L] pursuant to Rule 7.08(2)(b) and Rule 7.08(2)(c). As was the case with the [Town D] property, the Wife contends that [Mr L's] evidence outlines significant deficiencies in the valuation report prepared by [Mr J] which include:
(a)An incorrect assessment as to the internal and external condition of the dwelling, as confirmed by the Building Inspection Report;
(b)An incorrect assessment as to the number of bedrooms of the property, which led to an inappropriate reliance upon sales that are not truly comparable with the [Suburb G] property (due to not having the same number of bedrooms and / or study/ies); and
(c)An incorrect assessment as to the difficulty of accessing the property via vehicle.
42.It is the Wife's position that were the parties to be confined to the cross‑examination of [Mr J] on these matters, the Court would similarly find itself in an "evidentiary vacuum" with insufficient evidence from which to ascertain the value of the [Suburb G] property.
…
45.As to the first factor, in this case, the Wife seeks to retain the [Suburb G] property as part of her final property entitlements. As was the case in Neale, the significant difference in value ($350,000) will have a greater impact on the Wife as compared with the Husband, as such a difference in value may have a material impact on the Wife's ability to retain the [Suburb G] property on a final basis.
46.As to the second factor, the Wife submits that there were matters known to [Mr L] that were not known to [Mr J], namely the matters raised in the Building Inspection Report which assessed the condition of the dwelling. [Mr L's] conclusion that the condition of the property was "below average" as opposed to [Mr J] who opined that the condition was "good overall" arguably led, at least in part, to the significant difference in value.
HUSBAND’S SUBMISSIONS
In relation to the land the husband submitted that Mr B’s report failed to comply with r 7.21 in that it failed to append to the report all instructions received, including those relating to the ‘conflict of interest’.
His King’s counsel further submitted that information barriers do not cure the problem that has arisen as a consequence of the wife’s engagement of Mr B. Mr B holds a superior position in N Company to that of Mr K and that, in essence, Mr K may be beholden to Mr B in the circumstances of his subordinate position in the firm and where his remuneration and advancement in the firm is ultimately the subject of board approval with Mr B as one of the nine members of the board.
The husband’s King’s counsel submits that if appointed, and there is a conclave of experts, the Court could have no confidence that the single expert would be able to “withstand the obvious pressure of so doing or that his evidence will not be coloured by the disagreements and critique of it by [a senior executive] of the firm that now employs him” (husband’s Case Outline filed 25 September 2024, paragraph 6).The husband submits that the appointment of Mr B would undermine confidence in the single expert.
Otherwise, King’s counsel for the husband submits that Mr B does not depose to any substantial body of opinion contrary to that of Mr K’s or know of matters not known to Mr K. She submits:
7.…Rather he bases his differing conclusion as to the value of [Town D] on the following matters:
(a)Different comparable sales, which he says better reflect the characterisation of [Town D];
(b)Different land size, although he states this is best dealt with by a land surveyor’s report as this is outside his area of expertise; and
(c)Criticism that [Mr K] commented outside of his area of expertise when he concluded any available subdivision would not be for the 230 lots included in the [R Architects’] subdivision plan.
(Footnote omitted)
The husband’s King’s counsel submits that these are matters for cross-examination and not for the appointment of an adversarial expert.
In relation to the home, Kings Counsel submits that all of the matters raised in the submissions of the wife can be addressed in cross-examination and do not meet the threshold pursuant to r 7.08 for the appointment of another expert.
DISPOSITION
In relation to the land, it is necessary to deal with the anterior question whether there is a ‘conflict of interest’. If that is answered in the affirmative, then according to the husband, the balance of the application become otiose.
I have considered carefully the submissions referred to above, as expanded in writing, made orally, and the totality of the evidence including the cross-examination of Mr B. I am not satisfied that it can properly be categorised as a conflict of interest, but nothing turns on nomenclature or categorisation. Its resolution turns on a consideration of the substance, rather than form.
Albeit not expressed in such terms, the arguments, when properly distilled, invite a consideration as to whether in light of all the circumstances the Court is satisfied that Mr K would remain an independent and impartial valuer of the land who is prepared to give an objective and unbiased opinion if leave were granted to the wife to adduce evidence from Mr B. In that respect r 7.18 assumes importance.
Rule 7.18 provides as follows:
7.18 Expert witness’s duty to the court
(1)An expert witness has a duty to assist the court with matters that are within the expert witness’s knowledge and capability.
(2)The expert witness’s duty to the court prevails over the obligation of the expert witness to the person instructing, or paying the fees and expenses of, the expert witness.
(3)The expert witness has the following duties:
(a)to give an objective and unbiased opinion that is also independent and impartial on matters that are within the expert witness’s knowledge and capability;
(b)to conduct the expert witness’s functions in a timely way;
(c)to avoid acting on an instruction or request to withhold or avoid agreement when attending a conference of experts;
(d)to consider all material facts, including those that may detract from the expert witness’s opinion;
(e) to tell the court:
(i)if a particular question or issue falls outside the expert witness’s expertise; and
(ii)if the expert witness believes that the report prepared by the expert witness is based on incomplete research or inaccurate or incomplete information, or is incomplete or may be inaccurate, for any reason;
(f) to produce a written report that complies with rules 7.21 and 7.22.
(4) The expert witness’s duty to the court arises when the expert witness:
(a) receives instructions under rule 7.13; or
(b)is informed by a party that the expert witness may be called to give evidence in a proceeding.
(5)An expert witness who changes an opinion after the preparation of a report must give written notice to that effect:
(a)if the expert witness is appointed by a party—to the instructing party; or
(b)if the expert witness is appointed by the court—to the Registry Manager and each party.
(6) A notice under subrule (5) is taken to be part of the expert’s report.
I am not satisfied that the evidence established that Mr K would not remain an independent and impartial valuer of the land who is prepared to give an objective and unbiased opinion or that I could conclude that position would change if the wife were granted the leave she seeks. I reach that conclusion for the following reasons:
(a)Mr K has sworn an affidavit that records that the opinions expressed in his report are independent and impartial. He says he has read and understands Part 7.1 of the Rules in relation to his duties and responsibilities as an expert witness. He says that he has complied with the requirements of his professional code and understands his duty to this Court and has complied with that duty and, critically in respect of the husband’s submission, will continue to do so.
(b)It cannot be that any aspect of Mr B’s evidence (in circumstances where he has not spoken to Mr K about his report) bears upon the impartiality or independence of Mr K or bears upon Mr K’s ability in the future to give an objective or unbiased opinion where Mr K has not given evidence.
(c)I cannot infer, despite invitation to do so, that Mr K, contrary to his oath and his acknowledgement and acceptance of his duties and responsibilities as an expert witness, would suddenly no longer be independent or impartial or that he would not give an objective or impartial opinion if leave were granted in the absence of his cross‑examination.
(d)It is not adequately explained how the information barriers that have been implemented would adversely impact on the independence and/or impartiality of Mr K.
(e)Acceptance of the husband’s submission invites the conclusion that if Mr K were to change his opinion that he does so as consequence of his employment and the respective positions in N Company of he and Mr B inconsistent with his duty to the Court more particularly enshrined in r 7.18(3)(d) and/or r 7.18(3)(e). Such a conclusion is not open. As Noonan J observed in Duffy v McGee [2022] IECA 254 at 94:
The duty of impartiality and independence necessarily imports a willingness on the part of the expert to remain open to alternative possibilities and if necessary to change his or her mind when confronted with new information.
It is simply not open to conclude that Mr K may change his opinion for the reasons advanced by the husband. The evidence before me is not so probative or compelling that I could find or infer that he may or would do so. Indeed, consistent with his oath, I am satisfied that the current state of the evidence is that he would remain independent and impartial. I am not satisfied that there is a foundation to the propositions advanced by the husband that there is a ‘conflict of interest’ of any type, nor am I satisfied that by granting the leave sought by the wife, Mr K would no longer be independent or impartial or unable to offer an objective unbiased opinion. Issues as to the inclusion of documents that should have been appended to Mr B’s report go to its ultimate admissibility not the question of leave to adduce the evidence.
I turn to consider the application for leave.
Rule 7.02 of the Rules embodies the purpose of the Rules that deals with experts, namely, that a party should only obtain expert evidence in relation to a significant issue, that it should be restricted to that necessary to resolve or determine the proceedings and that without compromising the interests of justice, expert evidence is to be given by a single expert.
The choice of expert is very much a lottery. The parties do not know when they select their expert what the ultimate opinion might be. Despite some appearance to the contrary, there is no magic or exalted status that accrues to the single expert by virtue of the lottery that selects them. It is for that reason that the Rules permits a party to seek leave to tender and/or adduce evidence from another expert.
Rule 7.08 imposes a restriction on a party seeking to tender a report or adduce evidence from another expert subject to the court being satisfied pursuant to r 7.08(2) 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.
Sight must not be lost of the fact that the Court’s determination is to ensure justice is accorded to each of the parties. The Rules are not to be construed as a straitjacket restricting the interests of justice, rather, they are designed to serve the interests of justice.
For that reason, r 7.08 cannot be read in isolation and must be read with r 7.02 and in particular r 7.02(c), which specifically provides:
(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.
As the High Court observed in the Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146 at 155:
… Justice is the paramount consideration in determining an application such as the present one … Case management, involving as it does the efficacy of the procedures of the court, was in this case a relevant consideration. But it should not have been allowed to prevail over the injustice of shutting the applicant out from raising an arguable defence, thus precluding determination of an issue between the parties.
The wife contends that her application meets each of the subsections. She relies upon the evidence of Mr B referred at paragraph 35 above and more fulsomely addressed at paragraph 6 of Mr B’s affidavit sworn 30 August 2024. Relevant to this application are the observations of the Full Court in Neales & Neales (2022) FLC 94-079 (“Neales”) that the various considerations may in aggregate establish a special reason.
Turning then to the requirements of r 7.08(2), I am not satisfied that the submissions of the wife demonstrate that there is a substantial body of opinion contrary to the opinion given by the single expert. In that respect, the Full Court in Neales observed:
46As Kent J observed in Salmon and Ors & Salmon [2020] FamCAFC 134 (“Salmon”) at [35]:
35.… the words “substantial body of opinion” in r 15.49(2) are to be given real meaning, as was the approach taken by the primary judge. The approach that the words have meaning of substance has been adopted, correctly in my view, in other decisions at first instance in this Court. 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…
(Footnote omitted)
A search through the submissions for the identifiable substantial body of contrary opinion was an arid exercise.
Mr B’s evidence at paragraph 6 of his affidavit sworn 30 August 2024 was unchallenged by contrary evidence or cross-examination. It was not suggested that Mr B did not have the requisite experience or qualifications to express the opinions he did. The difference in value is significant. While I accept, consistent with Neales, that a difference of opinion as to value “does not simpliciter establish a basis for an adversarial expert” (Neales at [53]) I am satisfied that the more substantial the difference, in the absence of a challenge as to expertise and/or experience, calls for closer attention to the matters that are said to be the basis for the contrary opinion. Those matters considered in “aggregate” (Neales at [40]) as referred to in Mr B’s affidavit (being (b) and (d) referred to in paragraph 35 above) particularly where they are not challenged together with the difference of opinion as to value are such as to satisfy the requirement of “another special reason” (r 7.08(2)(c)).
While different comparable sales could be challenged through cross examination and the argument about size resolved by the appointment of a single expert, I am not satisfied that just leaving the matter to cross-examination on the other points of difference as proposed by the husband meets the requirements of r 7.02(c). While I am satisfied that it is not impracticable to have more than one expert, I am not satisfied for the above reasons that having one expert would ensure that the interests of justice are not compromised.
The wife will be granted leave to adduce evidence from Mr B.
In relation to the home, the wife contends that the single expert has incorrectly described the number of bedrooms or the configuration of the rooms. As the wife’s King’s counsel conceded, that is a matter of fact that will be established by cross examination and is not a matter that provides a basis for another expert. Likewise, descriptions by one valuer of “below average” as opposed to “good condition overall” are just the subjective assessments of the particular valuer and provide no foundation for leave to adduce evidence from another expert. Issues as to number and spread of comparable sales are matters that can be addressed in cross‑examination of the single expert. There is no material before me by way of contribution assessment or matters under s 75(2), the competing final applications of the parties or financial questionnaires to make good the matters referred to in paragraph 45 of the wife’s Case Outline.
I further note that the difference in value between the two experts is some $350,000. Measured against the pool advocated for the wife of $28 million squarely calls into question issues of proportionately (r 7.02(d)) and consideration of the overarching purpose identified in s 67 of the Federal Circuit and Family Court of Australia Act 2021 (Cth).
I am not satisfied that there is a basis for leave in relation to Mr L.
As to the orders sought by the husband in respect of the preparation of a building report in relation to the roof, the wife contends that the condition of the building is such that it extends beyond merely the roof. Albeit faced with such a request, the wife does not seek to widen the scope of enquiry. I am satisfied that there is merit to the submissions advanced on behalf of the husband and that the logical course is to permit a report to be prepared and such report to be provided to the single expert.
The order as drafted may infelicitously have not included words referrable to the cost of the works to undertake the repairs. If it was, I will include them. If it was not, it is difficult to envisage any prejudice occasioned by having the expert so opine.
I do not propose to make orders at this stage for the preparation of updated valuations until the hearing dates are known and allocated. The wife’s Application in a Proceeding filed 30 August 2024 and the husband’s Response filed 18 September 2024 will otherwise be dismissed.
I will make orders to give effect to the above.
I certify that the preceding sixty-eight (68) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Schonell. Associate:
Dated: 12 November 2024
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