Sully and Sully

[2017] FamCA 952

FAMILY COURT OF AUSTRALIA

SULLY & SULLY [2017] FamCA 952

FAMILY LAW – PROPERTY – Leave to rely on material out of time – leave refused

APPLICANT: Mr Sully

RESPONDENT: Ms Sully

INDEPENDENT CHILDREN’S LAWYER: Mary Lonergan

FILE NUMBER: MLC 2232 of 2016

DATE DELIVERED: 21 November 2017

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Gill J

HEARING DATE: 21 November 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Glick, QC assisted by Mr Puckey

SOLICITOR FOR THE APPLICANT: Kennedy Partners

COUNSEL FOR THE RESPONDENT: Mr North, QC, assisted by Mr Werner

SOLICITOR FOR THE RESPONDENT: Taussig Cherrie Fildes

COUNSEL FOR THE INDEPENDENT CHILDREN’S LAWYER: Mr Whitchurch

SOLICITOR FOR THE INDEPENDENT CHILDREN’S LAWYER: Victoria Legal Aid

Orders

1. The leave sought by the husband to rely upon the affidavit evidence from Mr BB, Mr CC, Mr D, Mr EE, Mr FF, Mr GG and Mr HH at the trial of 20 November 2017 is refused.

2. Leave to the wife to rely upon the affidavit material of Mr II and Mr KK at the trial of 20 November 2017 is also refused.

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

IT IS NOTED that publication of this judgment by this Court under the pseudonym Sully & Sully has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 2232 of 2016

Mr Sully

Applicant

And

Ms Sully

Respondent

EX TEMPORE REASONS FOR JUDGMENT

1. This matter involves a dispute both in relation to property and children.  The property involves a pool estimated by the wife of being in the order of $120 million.  There are four children of the relationship, four boys.  There are preliminary matters that require resolution at the commencement of when this matter was listed for trial that have a significant impact on the conduct of the trial or even whether the trial can proceed at this point.

2. Those matters relate to late filing of all property evidenced by both of the parties and a failure by either of the parties to comply with the trial directions that were given in May.  It places the parties in the position where each now requires leave for all valuation or expert evidence regarding the property matters and the question arises as to whether that leave should now be granted. 

3. Orders were made on 1 May 2017 for the trial to commence on 20 November 2017.  In particular those orders provided for the mechanics of obtaining valuation evidence for the trial, provided for a single expert regarding real and personal property and adversarial experts for the valuation of the X group.  Neither regime has been complied with, leaving the expert reports and valuations filed last week or still being or still intended to be filed later during the trial. 

4. The key matters provided for in the evaluation mechanisms were firstly as to valuation of the X group.  The husband provided an initial report regarding the valuation more or less in accordance with the directions that were given in June 2017.  However, he subsequently advised on 19 October when he was due to file his trial material that he would not be relying upon that report that he had previously provided to the wife but would rely on an updated report that was at that stage not available.  That report was provided to the Court on 17 November 2017, the week before the trial.

5. The wife engaged her own expert in relation to X group within the general framework of the directions as she was able.  However, this was delayed despite the husband having provided her with his report in June 2017.  It was delayed because of the need as she saw it to value the underlying property.  In the meantime there was an ongoing disagreement between the lawyers for each of the parties as to how the orders operated and whether the mechanism for obtaining single experts was applicable to the underlying property of the X group or just for the other property.

6. The second valuation mechanism related to the appointment of single experts.  The wife sought to rely upon it and to appoint a single expert, although she now says that she did not actually affect the obtaining of a single expert, but rather now sought to rely upon that expert as an adversarial expert, being a Mr II, who conducted a valuation of a number of items of real estate.  In relying upon the single expert mechanism the wife complained that there was no response by the husband to her proposed use of the single expert mechanism.  She subsequently resorted to those mechanisms without his cooperation, taking and advising him that she took his failure to respond as constituting consent in accordance with the orders.

7. The husband however claims that he did cooperate, at least to the extent that it was his view that the single expert mechanism was only applicable to the non-X group property and that the wife did not respond to his correspondence.  In any event he did not seek to have the non-X group property valued by a single expert.

8. Subsequently, the wife received the valuations from Mr II up to and slightly after the date that was provided for in the May 2017 directions, that is, leading up to and slightly after 20 September 2017.  After that date, which was supposed to be the final date for the single expert material to become available, the husband repeatedly sought from the wife to be provided with the valuations.  Those repeated requests were made from September and into October.  The material was not provided until the week prior to the trial in circumstances where if it was the case that the wife was relying upon the single expert mechanism they were due on 20 September and if she was not relying upon the single expert mechanism, then leave was going to be required to enable them to be relied upon and the affidavits would have been due on 1 November 2017. 

9. One of the consequences of those valuations coming in around September was that they were unavailable to the wife until that point in order for her to give them to her adversarial expert in relation to the X group.  The expert she engaged required the valuations and therefore had to wait until September 2017 to have them.  This had the further consequence that the wife was then grossly out of time to comply with the obligations contained in the previous directions for there to be conferencing between the experts.  Neither party applied to vary the directions despite there being a mechanism allowing them to approach the Registrar to do so.  While the wife’s expert was accordingly delayed before he provided his opinion to the wife, she came on notice that the husband was no longer relying upon the initial report that he had given to her but on one that would subsequently be provided and ultimately was not provided until just before the commencement of the trial. 

10. The wife, whose report was predicated to some degree upon the husband’s report, accordingly did not produce her report to the husband until late in the piece.  Given the structure of the orders there was some justification in the delay on the part of the wife.  The orders provided that the husband’s report was to be made available to her, and that if she disagreed with it she could then obtain her own report.  So the ultimate delays in the husband’s report, that is, his advice to her that he would rely on a subsequent report, provides some justification to her in delaying the production of her report to the husband. 

11. Very late in the piece the husband sought to rely upon a number of valuers.  The wife also sought to rely upon her valuers which were part filed on 15 November 2017 and part un-filed.  These were the valuations that were available to her in September 2017.  Each of the parties, again late in the piece, filed valuations in relation to the X group. 

12. There are mixed questions of leave that arise.  Leave in relation to the use of non-single experts as valuers and leave in relation to non-compliance with the directions.

13. The directions upon the husband were that he was to file and serve his material to be relied upon at trial by 11 October 2017.  On 25 October 2017 he filed a further amended initiating application, an affidavit and financial statement.  On 17 November 2017 he filed a further affidavit from himself, and sought to rely on affidavits from Mr BB, Mr CC, Mr D, Mr EE, Mr HH, Mr FF and Mr GG, Mr GG’s yet to be filed.   Other documents were also relied upon in relation to the children’s matter but I need not deal with those now. 

14. The wife was to file and serve by 1 November 2017.  On 10 November she filed an amended response, an affidavit and financial statement.  That particular delay can well be explained by the delay in the initial filing by the husband.  She then attempted to file on 17 November 2017 an affidavit from Mr KK, however it was not filed as I understand it due to industrial action within the Court.  She sought to file affidavit material from Mr II, the valuer, on 15 and 16 of November 2017, being unsuccessful in the filing on 16 November 2017.  These filings were made in the face of Order 6 of the directions which provided that no party was to file and serve other than in accordance with those Orders, except with the leave of the Court, should leave be granted. 

15. The main purpose of the Rules is to promote the resolution of disputes between the parties in a just and timely manner at a cost that is reasonable to the circumstances of the case.  If leave is refused there will be significant delay I expect of the property trial and a significant increase in costs due to the repeated preparation for the trial.  If leave is granted the question arises as to whether or not the subsequent hearing would be unjust. 

16. The wife can legitimately complain of the disregard shown by the husband of the obligations made in the directions for the valuation of the X group.  He was not at liberty to conduct a frolic of his own, particularly without support from the wife, to depart markedly and radically from the directions that were given in relation to the X group.  His conduct has been significantly causative of the delay in the wife’s valuation of the X group. That is, if the wife’s delay in the production of her X report was the extent of her default it may have been not significant enough a default as to deprive her of obtaining leave. 

17. However, at the same time the wife’s withholding of valuations of the real property which was a key component both of the valuation of the X group and the other valuations both beyond 20 September 2017 and beyond 1 November 2017 that is, until immediately before the trial was due to commence, robs her of the ability to say her default was caused by the husband and ought not to be held against her.  If those valuations had been produced in a timely fashion to the husband then without having to resolve it she had a strong argument to proceed, despite the late filing of her own opinion evidence in relation to the X group.  However, they were not produced in a timely fashion that deprives the husband of a reasonable opportunity to answer the case brought by the wife as produced to the husband at the last minute and as constituting the foundation of the most significant part of the pool.

18. Each of the parties has been non-compliant with the directions in a manner that seriously undermines the proper and just trial of the property proceedings.  It may be that the husband’s evidence would have come to naught as being inadmissible but the wife’s material produced in the circumstances identified above are also creative of an unfairness in the trial that cannot be tolerated. 

19. The leave sought by the husband to rely upon the affidavit evidence from Mr BB, Mr CC, Mr D, Mr EE, Mr FF, Mr GG and Mr HH at the trial of 20 November 2017 is refused.

20. Leave to the wife to rely upon the affidavit material of Mr II and Mr KK at the trial of 20 November 2017 is also refused.

I certify that the preceding twenty (20) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Gill delivered on 21 November 2017.

Associate:

Date:  21 November 2017