Shamon & Shamon (No 13)
[2024] FedCFamC1F 506
•30 July 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Shamon & Shamon (No 13) [2024] FedCFamC1F 506
File number: SYC 2375 of 2021 Judgment of: CHRISTIE J Date of judgment: 30 July 2024 Catchwords: FAMILY LAW – PRACTICE & PROCEDURE – Application to adduce further evidence – Expert evidence – Valuation evidence – Value of overseas property in which the applicant contends the respondent has a beneficial interest – Where the application is part-way through the trial – Where the evidence is non-compliant with the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 and inadmissible – Valuation evidence rejected – Revisiting of earlier evidentiary rulings – Leave granted to the applicant to adduce further lay evidence. Legislation: Family Law Act 1975 (Cth) Pt VII and Pt VIII
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Pt 7.1, rr 7.02 7.04, 7.10, 7.11, 7.13 7.22, 7.23
Cases cited: Dasreef Pty Ltd v Hawchar (2011) 243 CLR 588
Shamon & Shamon (No 12) [2024] FedCFamC1F 69
Division: Division 1 First Instance Number of paragraphs: 55 Date of last submission: 29 July 2024 Date of hearing: 25 July 2024 Place: Sydney Counsel for the Applicant: Mr A Schonell Solicitor for the Applicant: Barkus Doolan Winning Counsel for the First Respondent: Mr Schatz Solicitor for the First Respondent: Lawbridge Lawyers & Consultants The Second Respondent: Excused from participating The Third Respondent: Did not participate ORDERS
SYC 2375 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR SHAMON
Applicant
AND: MS SHAMON
First Respondent
MR B SHAMON
Second Respondent
MS G SHAMON
Third Respondent
ORDER MADE BY:
CHRISTIE J
DATE OF ORDER:
30 JULY 2024
THE COURT ORDERS THAT:
1.The applicant have leave to adduce evidence from Mr AN filed 24 April 2024.
2.The applicant have leave to tender MS92 and 93.
3.The Application in a Proceeding filed 18 July 2024 is 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 a pseudonym Shamon & Shamon (No 13) has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
CHRISTIE J:
This is an application for leave to adduce further evidence part way through a trial. The applicant husband is the first respondent in substantive parenting and property proceedings under Pt VII and Pt VIII of the Family Law Act 1975 (Cth) (“the Act”). This application relates only to the property aspect of the proceeding.
The second respondent (the husband’s brother) and the Independent Children’s Lawyer were excused from appearing and the third respondent (the husband’s sister) to date has not participated.
The final hearing in this matter commenced on 4 April 2024. The matter was adjourned part‑heard on 12 April 2024 and was listed to resume, today, 30 July 2024, for a further four days of hearing. Evidence in the wife’s case has concluded.
The husband’s application was filed on 18 July 2024 and has been listed on short notice.
The husband seeks leave to adduce the following evidence:
(a)An affidavit of Mr AO, property valuer in Country UU, filed 28 May 2024, together with an affidavit of Ms AP filed 28 May 2024, which translates a valuation report of Mr AO. In the alternative, the husband seeks that Mr AO is appointed as an expert in these proceedings;
(b)An affidavit of Mr AQ, a lawyer in Country UU, filed 28 May 2024;
(c)An affidavit of Mr AN, the husband’s brother-in-law, filed 24 April 2024; and
(d)“[MS]90” to “[MS]93” of the husband’s trial affidavit filed 11 March 2024, therein identified as:
(i)Estate Statements dated 22 July 2013 (MS90);
(ii)Estate Statements dated 22 January 2018 (MS91);
(iii)Sale Agreement dated 1 April 2019 (MS92); and
(iv)Sale Agreement dated 7 October 2021 (MS93).
Save for the affidavit of Mr AN (which relates to a balance sheet dispute about an addback), the husband seeks to adduce the above evidence to advance an argument that the wife has a beneficial interest in residential units in Country UU, namely XX Real Estate (“the Country UU property”) in respect of which her brother is the registered proprietor. Should leave be granted, the husband seeks that those persons be granted leave for permission to give evidence electronically for cross-examination, if required.
The wife opposes the husband’s application but does not oppose the granting of leave for the witnesses to give evidence electronically should I accede to the application.
On 14 February 2024 I heard an application by the husband to join the wife’s brother to the property proceedings, in which the husband sought, in his final relief, a declaration that six units located in Country UU, were and are held on trust by the wife’s brother for her benefit.
On 16 February 2024 I delivered judgment dismissing the husband’s application to join the wife’s brother and gave reasons (Shamon & Shamon (No 12) [2024] FedCFamC1F 69). I set out the following background:
16. The chronology appears to be as follows:
(a)2015 – the husband says the wife told him her father had gifted her and her siblings “two large parcels of land”. The sibling group would appear to consist of six children according to the husband’s affidavit. The wife denies the conversation and the receipt of a gift of land from her father.
(b)2016/17 – the husband says the wife’s brother indicated he had developed [a number of] units on the land at a cost of AUD 3 million and required $500,000 to complete the work at which time the wife’s entitlements would be 5 units or more if the husband provided funds. The wife denies this arrangement. The husband says he borrowed money and paid $75,000 to the wife’s brother after which he understood the wife would receive an additional unit so as to bring the total to 6 units. The wife denies this arrangement.
(c)2018 – the husband says one unit was sold.
(d)2019 – the husband says one unit was sold.
(e)30 June 2020 the parties separated.
(f)October 2020 – the husband says the wife’s brother asked for $40,000 to facilitate transfer of the units into the wife’s name.
(g)October 2021 – the husband says one unit was sold.
17.While there are documents attached to the husband’s affidavit, they do not include any documents which demonstrate the land was transferred from the wife’s father to the wife’s brother.
As to value, I said this:
23.If the husband is ultimately determined to be accurate in his representation of the ownership of the property the participation of the wife’s brother may, as I raised with counsel, be necessary in order to have valuation evidence. But, it would be inevitable at this stage that formal valuation (even if possible – and there is no evidence) would necessitate vacation of the hearing dates. The concept of that which is necessary to determine the dispute must include some notion of what steps are reasonable and proportionate in the context of the litigation as a whole.
24.I have not heard any concrete proposal about valuation. But I do have some evidence of value in the husband’s own evidence. The present evidence being the best evidence available is contained in the transfer documents and supports the conclusion that even if the declaration were to be made as sought, the value of the property is de minimis in the context of the husband having accumulated $502,464 of legal fees according to his most recently filed costs notice (December 2023) and the wife having accrued $439,256 in legal fees according to her most recent costs notice (February 2024).
The husband contends in his affidavit in support of the present application that “in circumstances where [the wife] denied having any interest in the [Country UU] units, [he] had little hope that she would agree, let alone respond to any request to appoint a single expert to value the [Country UU] units”. Simultaneously the husband says it was his intention to seek a valuation of the Country UU units once the husband’s brother was joined to the proceedings.
The husband on 17 February 2024, following the handing down of judgment, emailed a lawyer in Country UU, Mr AQ, to whom he is related but with whom he says he has never had dealings or a relationship. The email requests that Mr AQ have the units owned by the wife’s brother valued.
Mr AQ thereafter instructed Mr AO to value the Country UU property. Mr AO inspected only the exterior and made enquiries with the Department of Surveyors. On 23 February 2024 the husband received a valuation report of the Country UU property in Country UU language and in English.
The husband provided the wife with the valuation report by Mr AO on 11 March 2024.
On 12 March 2024 the husband received further documents from Mr AQ, including the CV of Mr AO and further information regarding the basis of his valuation.
THE LAW
Part 7.1 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) deals with experts in family law proceedings. Rule 7.02 provides the following purpose:
The purpose of this Part 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.
The expert evidence sought to be adduced by the husband has not been instructed on the basis of a single expert witness. Rule 7.04(4) of the Rules provides that a party does not need the court’s permission to tender a report or adduce evidence from a single expert witness. The husband’s alternate relief seeks that Mr AO be appointed as an expert.
Accordingly in determining the primary relief sought by the husband, namely leave, I am dealing with Div 7.1.3 of the Rules which relates to permission for expert evidence. Rule 7.10(1) of the Rules provides that a party must apply for the Court’s permission to tender a report or adduce evidence at a hearing or trial from an expert witness, other than a single expert witness.
Rule 7.11(3) of the Rules sets out the considerations and provides:
(3) When considering whether to permit a party to tender a report or adduce evidence from an expert witness, the court may take into account the following:
(a) the purpose of this Part (see rule 7.02);
(b) the impact of the appointment of an expert witness on the costs of the proceeding;
(c) the likelihood of the appointment expediting or delaying the proceeding;
(d) the complexity of the issues in the proceeding;
(e) whether the evidence should be given by a single expert witness rather than an expert witness appointed by one party only;
(f) whether the expert witness has specialised knowledge, based on the person’s training, study or experience:
(i) relevant to the issue on which evidence is to be given; and
(ii) appropriate to the value, complexity and importance of the proceeding.
Rule 7.13 sets out how instructions are to be given to an expert. Subrule (2) and (3) provide:
(2) A party who instructs an expert witness to give an opinion for a proceeding or an anticipated proceeding must:
(a) ensure the expert witness has a copy of the most recent version of, and has read, Divisions 7.1.4, 7.1.5 and 7.1.6 of these Rules; and
(b) obtain a written report from the expert witness.
(3) All instructions to an expert witness must be in writing and must include:
(a) a request for a written report; and
(b) advice that the report may be used in an anticipated or actual proceeding; and
(c) the issues about which the opinion is sought; and
(d) a description of any matter to be investigated, or any experiment to be undertaken or issue to be reported on; and
(e) full and frank disclosure of information and documents that will help the expert witness to perform the expert witness’s function.
As to the contents of an expert’s report, r 7.22 provides:
(1) An expert’s report must:
(a) state the reasons for the expert witness’s conclusions; and
(b) include a statement about the methodology used in the production of the report; and
(c) include the material referred to in subrule (2) in support of the expert witness’s conclusions.
(2) For the purposes of paragraph (1)(c), an expert’s report must include the following in support of the expert witness’s conclusions:
(a)the expert witness’s qualifications;
(b) the literature or other material used in making the report;
(c) the relevant facts, matters and assumptions on which the opinions in the report are based;
(d) a statement about the facts in the report that are within the expert witness’s knowledge;
(e) details about any tests, experiments, examinations or investigations relied on by the expert witness and, if they were carried out by another person, details of that person’s qualifications and experience;
(f) if there is a range of opinion on the matters dealt with in the report—a summary of the range of opinion and the basis for the expert witness’s opinion;
(g) a summary of the conclusions reached;
(h) if necessary, a disclosure that:
(i) a particular question or issue falls outside the expert witness’s expertise; or
(ii) the report may be incomplete or inaccurate without some qualification and the details of any qualification; or
(iii) the expert witness’s opinion is not a concluded opinion because further research or data is required or because of any other reason.
As to the consequences of non-compliance with the Rules, r 7.23 provides:
If an expert witness does not comply with these Rules, the court may do any of the following:
(a) order the expert witness to attend court;
(b) refuse to allow the expert’s report or any answers to questions to be relied on;
(c) allow the report to be relied on but take the non‑compliance into account when considering the weight to be given to the expert witness’s evidence;
(d) take the non‑compliance into account when making orders for:
(i) an extension or abridgment of a time limit; or
(ii) a stay of the proceeding; or
(iii) interest payable on a sum ordered to be paid; or
(iv) costs.
CONSIDERATION
The husband’s application to adduce further evidence mid-way through the hearing is opposed by the respondent wife. The other parties to the litigation did not take any position and did not participate in the hearing.
Conceptually there are three distinct pieces of evidence to consider:
(1)The evidence of the Country UU valuer and related evidence of the Country UU lawyer and the translator;
(2)The evidence of Mr AN; and
(3)The evidence in exhibits MS90-93 of the husband’s affidavit.
Valuation evidence
The applicant says, and I accept, that the issue of whether or not the wife is beneficially entitled to property in Country UU has been a live issue in the proceedings for some time.
The applicant says that if I accept, as he contends, that the wife is beneficially entitled to the property he has identified then it follows that it would be appropriate that I have evidence as to its value. Again, the submission is accepted – but not without some caveat.
The respondent says that there are two main bases upon which I would reject the evidence of the valuer – the first is the prejudice occasioned to the wife by its late filing and the second is the difficulties which she identifies with its admissibility.
The applicant submitted that I could defer questions of admissibility. In the circumstance of this case, I do not accept that submission. I am being asked to consider whether or not to admit expert evidence mid-way through a trial – the time for consideration of whether that evidence is admissible is at the time the application is made to rely on it so that both parties know what material is before the Court and in what form.
The respondent submitted that the affidavit of the valuer and the attached report did not comply with the Rules. I agree. The applicant said either the Rules could be dispensed with or the defects could be cured in due course. Theoretically, both propositions are correct. It is necessary to examine the nature of the defects and the questions about admissibility to determine which course is appropriate.
As to lack of compliance with the Rules – the Rules require the instructions to the expert to be in writing. This is for sound reasons. The brief to the expert should be clear and unambiguous. This is even more the case in circumstances where a party seeks to engage an adversarial expert as opposed to a single expert. The instructions to the expert were not in writing. In fact, there may have been some instructions in writing (see the references to “the residential units provided to [the valuer] via whatsapp” at annexure B to the affidavit of Mr AQ) but those are not before the Court. This is significant since transparency in the instructions provided assist a party to test the evidence.
An expert is required to comply with r 7.13(2)(a) of the Rules. There is no evidence that this has occurred.
Other than the alternate relief sought in this application, there was no attempt to bring an application to appoint a single expert however I accept, as the husband surmised in his affidavit, it may not have occurred by agreement. But, had such an application been brought then the wife would have had an opportunity to participate – should she have elected – in the qualification and instruction of the expert.
This application was heard the week prior to the resumed trial although I accept that the evidence has been served over a period of time commencing in February this year. That said, a party is entitled to know what evidence (in final form) is sought to be adduced to allow that person the opportunity to meet the evidence. The fact that the wife decries ownership or entitlement does not mean that she may not wish to be heard in the event the Court were to find against her. I accept that there is a prejudice to her should I accept this late filed material – the amount of time it has taken the applicant to attempt to qualify a witness overseas further underlines this point.
I turn now to consider what the respondent identified as difficulties related to the admissibility of the valuation evidence. In the affidavit of Mr AQ at [15] he says:
On or around 7 March 2024, I telephoned [Mr AO] and said to him words to the effect, “on what basis do you estimate it is $550 per meter?” to which [Mr AO] said, “the valuation comes from my experience and because I went to the property and examined in [sic] in person, and I asked builders around about the price and when I was there I saw a person there living in the apartment and I asked them and they said to me it is around 600 so to be fair, I said 550 per meter”.
I note that this particular instruction to the expert also suffers the defect that it is not in writing. However, the expert’s answers as set out in the conversation create insurmountable difficulties from an admissibility perspective. It is trite law that where the weight which can be attached to the evidence is so slight then it is not appropriate to admit it. That is the position here.
To the extent that the expert sought to provide the clarification to Mr AQ in writing he did so in a document which is annexure E to Mr AQ’s affidavit which says (having been translated):
Given that you asked me to clarify the basis of fixing the price of one square meter at 550$ five hundred and fifty American dollars for the residential apartments built on [XX Real Estate] which ownership belongs to [Mr AR].
As you know, I am an official sworn expert in the appraisal branch and affiliated with the [regional] sworn Experts-[Country UU]
…
Given that I am an official expert accredited by the courts and official authorities in [Country UU] the standard I relied on to price one square meter at 550$ five hundred and fifty American dollars based on the field investigation I have conducted on which the residential is located
(As per the original)
An expert opinion will not be admissible if the expert does not set out the basis upon which the conclusion or opinion has been provided (Dasreef Pty Ltd v Hawchar (2011) 243 CLR 588). Further, the process of exposing the methodology is the process by which the parties are able to test the evidence. A conclusion without an admissible foundation, such that the conclusion has no probative value, is not admissible. The valuer’s assertion of expertise is not a methodology. The valuer’s discussion with an unnamed third party about the “asking price” for an unidentified local property falls well below the standard of evidence which would be required to ensure that the opinion has a foundation.
I reject the evidence of the valuer.
I acknowledge that this means that should I find that the wife has a beneficial interest in the property in Country UU then I will not have expert opinion evidence upon which to reach a conclusion about the value of that property to the wife. However, as unfortunate as that circumstance might be, it does not oblige me to admit inadmissible evidence.
Evidence in exhibits MS90-93 of the husband’s trial affidavit
The parties took objections to the trial affidavit material at the commencement of the hearing. I made rulings. The husband seeks to revisit those rulings. The documents fall into two categories, namely “Estate Statements” and “Sale Agreements”.
I permitted the parties to make written submissions about this issue and the applicant took the opportunity afforded within the timeframe offered and the respondent filed submissions after the timeframe directed.
In respect of the Estate Statements – they were excluded (at the trial) on the basis that they were hearsay documents prepared on their face as a consequence of someone transcribing information from an original document.
The following is evident from the transcript:
[COUNSEL FOR THE WIFE]: Your Honour, [MS]90, which is the document referred to at page 1060. The objection is a hearsay objection. That document that appears starting at page 1060 doesn’t appear to be a business record. It appears to be a summary by a person that saw documents. It says:
Following the application number […69] presented by [Mr AS] [sic] and after having looked over the registers, this full statement has been delivered.
It’s his statement which is a summary of documents that he saw.
HER HONOUR: That would seem to be right. [senior counsel for the husband], what do you want to say to that?
[SENIOR COUNSEL FOR THE HUSBAND]: I accept that that’s what the document says, your Honour, and the document has then certified, but in circumstances where, your Honour, these documents come from [Country UU], this is the best evidence that we are able to obtain of searches that were undertaken.
HER HONOUR: Okay. I don’t think that I can accept the evidence in circumstances where it is plainly hearsay and none of the exceptions apply. So the document is out. That will be the same ruling in respect of each of the documents which have the same character. I think that would include [MS]91, as well. I will just check that. Yes, it’s a similar character…
(Transcript 4 April 2024, p.27 lines 17–39)
The manner in which this may have been remedied in the meantime would have been to obtain a copy of the original document in the original language and have it translated. This has not occurred.
I turn then to consider MS92 and 93 which are the purported Sale Agreements.
The following legal argument took place:
[COUNSEL FOR THE WIFE]:: Your Honour, the objection to 92 is that it appears on its face to be a translation of a document that’s not annexed without a certifying affidavit as to the way that it was prepared and likewise for 93.
HER HONOUR: That would seem to be correct.
[SENIOR COUNSEL FOR THE HUSBAND]: I accept that they’re not on affidavit, but at the bottom of each of the – at the end of the translations there is a certificate of translator certifying in relation to the true and complete translation of the document. If the issue my friend takes is that we don’t actually have the document in the foreign language, then I would seek leave to produce that, but ‑ ‑ ‑
HER HONOUR: Okay, we will defer that.
[SENIOR COUNSEL FOR THE HUSBAND]: ‑ ‑ ‑ we didn’t ‑ ‑ ‑
HER HONOUR: At the moment it’s out, but we can revisit that issue, if that’s the only objection.
(Transcript 29 July 2024, p.27 line 42 to p.28 line 14)
The manner of remedying the defect was to produce the sale agreement. I now understand that has occurred.
At paragraph [80] of the husband’s affidavit in support of this application he says:
On 24 April 2024, Barkus Doolan Winning served the original and translated documents referred to in [MS]-90 to [MS]93 of my trial Affidavit on [Ms Shamon].
The correspondence is annexed to the affidavit. It purports to serve the original and translated documents (but same are not included).
The respondent says it does little more than establish the identity of the vendor. That may be so. As I read the document it also notes a sale price.
I propose to admit the Sales Agreements. Each party may address me on weight in due course.
Affidavit of Mr AN
The affidavit of Mr AN goes to the wife’s contention that the Court would add back to the assets notionally in the possession of the husband the sum of $145,000 paid by the husband to Mr AN (or on his behalf) after separation.
Mr AN is married to the husband’s sister. The husband’s sister, Ms C Shamon is a party to the proceedings. She has sworn an affidavit.
The affidavit of Mr AN has been in the possession of the wife since about the time of its filing. I accept she has had time to consider the impact of the evidence (if any) if admitted.
Counsel for the wife was not able to identify a specific prejudice from the filing of the affidavit (albeit late) since the subject matter is such that it is unlikely that she could have given evidence on the matter or called additional evidence.
Absent identification of specific prejudice, I propose to permit the husband to rely on it subject to any questions of admissibility.
I certify that the preceding fifty-five 55 numbered paragraphs are a true copy of the Ex Tempore Reasons for Judgment of the Honourable Justice Christie. Associate:
Dated: 1 August 2024
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