Verdon & Verdon (No 4)

[2021] FamCA 270

FAMILY COURT OF AUSTRALIA

VERDON & VERDON (NO. 4) [2021] FamCA 270

FAMILY LAW – EVIDENCE – application to adduce evidence from a witness viva voce when an evidentiary ruling made the day earlier rendered inadmissible certain evidence the consequences of which the applicant wished to cure by adducing 12 years’ worth of financial information through the applicant – consideration of key authorities – proceeding adjourned, part heard.

Evidence Act 1995 (Cth) ss 55, 69
Family Law Act 1975 (Cth) s 79

Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175
Mallet v Mallet (1984) 156 CLR 605
Sali v SPC Ltd (1993) 67 ALJR 841
State of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146

APPLICANT: Mr Verdon

RESPONDENT: Ms Verdon

FILE NUMBER: MLC 12735 of 2017

DATE DELIVERED: 3 May 2021

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Wilson J

HEARING DATE: 26, 27, 28 & 29 April 2021

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr A. Strum QC with Ms H. Dellidis

SOLICITOR FOR THE APPLICANT: Accord Family Law

COUNSEL FOR THE RESPONDENT: Mr T. North SC with Mr T. Hutchings

SOLICITOR FOR THE RESPONDENT: Schembri & Co Lawyers

Orders by consent

1. The final hearing of the husband’s amended initiating application filed 21 April 2021 and the wife’s amended response filed 15 March 2021 is fixed to resume part heard before the Honourable Justice Wilson on Monday 11 October 2021 for an estimated five days.

2. The husband has liberty to use videolink for his witness Mr T for the purposes of his cross-examination.

3. By 28 May 2021 the husband file and serve an affidavit annexing the financial statements of H Pty Ltd from 1 July 2004.

4. By 25 June 2021 the wife has liberty to file and serve any affidavit in response to the husband’s affidavit pursuant to paragraph 3 herein.

5. Any objections in relation to the material filed pursuant to paragraphs 3 and 4 herein must be exchanged by 23 July 2021 and will be determined on the papers (unless the court requires otherwise) with rulings to be provided by 20 August 2021.

6. The following monies paid on the following dates to the trust account of Schembri & Co be characterised as partial property settlement in favour of the wife –

   (a)       $100,000 paid 13 November 2020;

   (b)       $75,000 paid 25 February 2021; and

   (c)       $75,000 paid 26 February 2021.

7. The husband cause to be paid to the wife’s solicitors Schembri & Co the further sum of $300,000 within seven days of these orders, to be characterised as part property settlement to the wife.

8. The husband is permitted to withdraw before 30 June 2021 the sum of $550,000 from H Pty Ltd to be characterised as part property settlement.

9. By no later than 5pm on 30 July 2021 the parties shall jointly instruct –

   (a)Mr N, with the husband to pay the costs of updating Mr N’s valuation at first instance, the wife’s half cost of the valuation to be adjusted from her final property entitlements; and

   (b)M Valuers to complete updated valuations of all real estate previously valued by M Valuers at joint expense, the husband to pay the costs of updating the M Valuers valuation at first instance, and the husband has liberty to seek the wife’s half cost of the valuation be adjusted from her final property entitlements.

10. The parties shall each instruct, at their own expense, their respective adversarial experts to complete a further updated single expert valuation report as at 30 June 2021 in relation to all entities in which the parties have an interest including but not limited to H Pty Ltd (being the owner of G Pty Ltd), F Pty Ltd, D Superannuation Fund, Verdon Superannuation Fund and the C Trust.

11. The parties do all things necessary to each instruct their adversarial witness and Mr N to confer in relation to their respective opinions of the values of the entities and provide to the parties by no later than 5pm on 30 August 2021, a memorandum addressed to this Honourable Court setting out the following –

    (a)       the matters upon which they agree and disagree; and

    (b)in relation to matters of disagreement, why each expert maintains that his opinion is to be preferred over the opinion of the other.

12. The parties have liberty to apply at short notice by direct approach to the chambers of the Honourable Justice Wilson for a telephone mention in relation to the matters the subject of these orders.

13. All costs are reserved.

14. Certify for counsel, including Senior Counsel.

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 Verdon & Verdon 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 12735  of 2017

Mr Verdon

Applicant

And

Ms Verdon

Respondent

REASONS FOR JUDGMENT

1. On 28 April 2021 I ruled that paragraph 81 of the applicant’s affidavit made 1 March 2021 was inadmissible.  In that paragraph the applicant purported to adduce financial information, especially of dividend distributions, over the financial years 2005 to 2017, 12 years in total.  The payees of the dividends allegedly included HH Trust, Verdon Family Trust and JJ Trust.  By reason of the information in paragraph 81 having been improperly adduced, I ruled that the information in paragraph 81 was inadmissible.

2. Upon the applicant commencing to give his evidence, Mr Strum QC produced a folder of documents that Mr Strum requested be put before the witness.  That met with protest by Mr North SC on the basis that –

   a)an impermissible attempt was being made to introduce evidence-in-chief, viva voce, when orders made months ago addressing dates for the filing of all witnesses’ evidence-in-chief had long passed;

   b)no prior notice of this step had been given to the respondent’s legal representatives;

   c)the folder to be handed to the applicant included financial information relating to entities and transactions over 12 years;

   d)if allowed, the financial information sought to be tendered would introduce financial evidence into the case that went substantially beyond the information addressed in paragraph 81 of the applicant’s affidavit, now ruled inadmissible;

   e)the endeavour to introduce this financial information was being pressed on the third day of the trial;

   f)if probative, the information that the applicant sought to introduce should have been the subject of properly proven evidence-in-chief in affidavit form;

   g)significant prejudice would be visited upon the respondent if the folder of documents was admitted into evidence;

   h)no proper evidentiary foundation had been laid for the attempt to adduce the documentary evidence in the folder; and

   i)no adequate explanation had been given for the applicant’s failure to adduce the financial information from 2005 to 2017.

3. The debate about Mr Strum’s attempt to adduce the additional documentary evidence that the applicant wanted to introduce consumed the balance of the third day of the trial.  It must be remembered that by then the applicant’s evidence had not gone beyond his adoption of his two affidavits as redacted in accordance with evidentiary rulings.  The court book was not finally settled by then as other rulings had been sought in relation to admissibility challenges concerning other witnesses yet to be called.

4. Mr Strum contended that the financial information in the folder met the description of “business records” for the purposes of s 69 of the Evidence Act.  He contended that documents meeting the description of business records were admissible per se and, for example, could be tendered in opening or at any time without the need for their verification through a witness. I invited Mr Strum QC to take me to the decided cases on that issue as intuitively it struck me that proof was required that a particular document satisfied the criteria prescribed by s 69 before it could be said that the relevant document met that criteria.

5. Mr North SC contended that the documents in the folder, namely financial information over the period 2005 to 2017 were not “relevant” for the purposes of s 55 of the Evidence Act because no fact in issue exists in this case about the improvement of the financial position of H Pty Ltd over the period 2005 to 2017. The real fact in issue in the case, so Mr North submitted, was each party’s contribution for the purposes of s 79 of the Family Law Act and the financial documents that the applicant sought to tender did not address that.

6. Mr Strum QC contended that unless I received the documents that he endeavoured to adduce I was at risk of falling into error because I would be disallowing information that informed the state of persuasion about the justice and equity of the circumstances.  To that Mr North SC submitted that throughout the marriage the parties were supported by funds derived from G Company/G Pty Ltd rather than dividends distributed by H Pty Ltd.

7. By the conclusion of the third day of the trial, Mr Strum indicated he wished to investigate certain authorities, including Mallet v Mallet[1] before concluding his application for leave to adduce additional evidence.  He said he would conclude his submissions by Thursday 29 April 2021.

   [1] (1984) 156 CLR 605.

8. With renewed energy, on the fourth day Mr Strum continued with his reply.  Relying on Mallet v Mallet, Sali v SPC Ltd,[2] State of Queensland v J L Holdings Pty Ltd[3] and Aon Risk Services Australia Ltd v Australian National University,[4] Mr Strum contended –

   a)the real issue in any decision about allowing the evidence he sought to introduce is the justice of the situation;

   b)compliance with machinery provisions of orders calling for documents to be filed by particular dates must always yield to the justice of either allowing or refusing steps consequent upon non-compliance with such machinery provisions;

   c)orders for the filing of affidavits out of time are always subject to the overall discretion of the trial judge;

   d)whether to allow the adduction of evidence even at this stage will be determined by the justice of the situation to which concepts of case management and the application of rules of court must yield;

   e)a party is not to be punished for any mistake or omission in the conduct of his or her case;

   f)a party should not be shut out from litigating a point that is fairly arguable; and

   g)the ultimate aim of a court is the attainment of justice.

   [2] (1993) 67 ALJR 841.

   [3] (1997) 189 CLR 146.

   [4] (2009) 239 CLR 175.

9. Mr North persisted in his client’s position that the application for leave to the applicant to put in evidence the documents in the folder should be refused.

10. It became apparent to me that I had an imperfect understanding of the significance of the documents the subject of Mr Strum’s application.  For that matter I had not been taken to them nor had I examined them because an identical folder to the one the contents of which I was asked to rule on had not been provided to Mr North.  I handed Mr North my copy of the folder and the folder never returned.  In the end I did not see the contentious documents.  It also became apparent that one upshot of this imbroglio was to allow the documentation to be properly proved by the applicant and for the respondent to have a corresponding opportunity to meet the evidence on which the applicant relied to adduce the documentation.

11. Any such opportunity meant that the trial had to be adjourned.  My next available calendar slot for five days is 11 October 2021.  Mr North submitted that if the case was adjourned to that date and his client had an opportunity to file and to rely on responding evidence, then his complaint based on prejudice necessarily diminished.

12. Late on the fourth day of the trial, after counsel conferred, they indicated that they were likely to bring in a consent minute that addressed procedural matters on the basis that the trial was adjourned part heard to 11 October 2021. 

13. On Friday 30 April 2021 in the afternoon consent orders were made in terms that appear at the commencement of these reasons.

I certify that the preceding thirteen (13) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Wilson delivered on 3 May 2021.

Associate: 

Date:  3 May 2021