Taylor v Saloniklis (No 2) - [2014] FCA 410

FEDERAL COURT OF AUSTRALIA
Taylor v Saloniklis (No 2) [2014] FCA 410

Citation: Taylor v Saloniklis (No 2) [2014] FCA 410

Parties: LYNETTE SU-YIN TAYLOR & ORS v SUZANNA SALONIKLIS & ORS

File number: SAD 336 of 2012

Judge: BESANKO J

Date of judgment: 30 April 2014

Catchwords:
PRACTICE AND PROCEDURE – application for appointment of Court expert – rule 23.01 of the Federal Court Rules 2011 (Cth) – valuation of interests in partnership and related trust – where valuation methodology in dispute – where proposed questions involve issues of fact, construction and law – whether appointment of Court expert will contribute to the just, efficient and cost-effective management of the proceeding – whether appointment of court expert will narrow the issues in dispute in the proceeding – whether the parties are likely to challenge the findings of a Court expert.

Held: Application dismissed.

Legislation: Federal Court Rules 2011 (Cth) r 23.01

Cases cited: Tyler v Thomas (2006) 150 FCR 357

Date of hearing: 28 February 2014

Place: Adelaide

Division: GENERAL DIVISION

Category: Catchwords

Number of paragraphs: 16

Counsel for the Applicants: Mr I Neil SC with Mr P Moorhouse

Solicitor for the Applicants: Petrine Costigan Lawyers

Counsel for the Respondents: Mr R Whitington QC with Dr Bleby SC

Solicitor for the Respondents: EMA Legal

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

SAD 336 of 2012

BETWEEN:
LYNETTE SU-YIN TAYLOR & ORS
Applicants

AND:
SUZANNA SALONIKLIS & ORS
Respondents

JUDGE:

BESANKO J

DATE OF ORDER:

30 APRIL 2014

WHERE MADE:

ADELAIDE

THE COURT ORDERS THAT:
1.The applicants’ application dated 16 December 2013 be dismissed.

Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

IN THE FEDERAL COURT OF AUSTRALIA

SOUTH AUSTRALIA DISTRICT REGISTRY

GENERAL DIVISION

SAD 336 of 2012

BETWEEN:
LYNETTE SU-YIN TAYLOR & ORS
Applicants

AND:
SUZANNA SALONIKLIS & ORS
Respondents

JUDGE:

BESANKO J

DATE:

30 APRIL 2014

PLACE:

ADELAIDE

REASONS FOR JUDGMENT

This is an application by the applicants against the respondents in a proceeding in this Court for the appointment by the Court of an expert under r 23.01 of the Federal Court Rules 2011 (Cth). Paragraphs 237 to 253 of the applicants’ Third Amended Statement of Claim (“Statement of Claim”) raise a number of valuation issues and it is proposed by the applicants that the expert address those issues. The expert put forward by the applicants is Mr Peter Holmes, who is a chartered accountant with expertise in accounting and valuation issues. The respondents oppose the application.
The applicants in the proceeding are Dr Lynette Taylor, LSY Taylor RSA Pty Ltd (“TaylorCo”), and Mr Alberto Alfocea. Mr Alfocea is Dr Taylor’s husband. Dr Taylor is the sole director and shareholder of TaylorCo and the controlling mind of the company. TaylorCo was a member of a partnership known as Radiology SA (“RSA”). It had the right to certain payments upon its departure from the partnership. In addition, Dr Taylor held 100 units in the Radiology…

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.

Continue reading Taylor v Saloniklis (No 2)

Details

AGLC: Taylor v Saloniklis (No 2) [2014] FCA 410
Case: [2014] FCA 410
Decision Date

CaseChat Overview and Summary

This proceeding involves an application by Dr Lynette Taylor, LSY Taylor RSA Pty Ltd, and Mr Alberto Alfocea against Suzanna Saloniklis and others for the appointment of a Court expert under r 23.01 of the Federal Court Rules 2011 (Cth). The applicants seek the expert's opinion on various valuation issues, including the valuation of Dr Taylor's interest in a partnership and her units in a trust. The respondents oppose the application, arguing that the issues do not warrant the appointment of a Court expert.

The court was required to decide whether the appointment of a Court expert would contribute to the just, efficient, and cost-effective management of the proceeding, and whether such an expert would help to narrow the issues in dispute. The court also needed to consider whether the parties were likely to challenge the findings of a Court expert. The primary issues in relation to the valuation of Dr Taylor's interest in the partnership are whether income from radiology services provided to non-RSA entities should be included in the determination of value, and whether the base for applying the multiple should be the Group's consolidated EBITA for the year of Dr Taylor's retirement from the partnership or a three-year average of EBITA.

The court concluded that the issues in relation to the valuation of Dr Taylor's interest in the partnership raise questions of fact, construction, and law, rather than accounting or valuation expertise. The court found that there was no need for a Court-appointed expert to contribute to the just, efficient, and cost-effective management of the proceeding. Instead, the court ordered the exchange of experts' reports and listed the matter for trial. The court also declined to appoint an expert to address the valuation of Dr Taylor's units in the trust, as the parties could gather their own expert evidence. The application for the appointment of a Court expert was dismissed.

Orders