Australia: Single experts in Family Court property disputes – What you need to know

As lawyers, it is imperative that we provide proper advice to our clients with respect to their entitlements within family law matters. When parties have interests in various entities, it is important that the valuations of those entities are accurate in order for lawyers to be able to advise their clients on the division of assets.

Lawyers regularly advise parties to appoint accountants as single experts in family law matters to prepare valuations on entities, whether they be businesses, companies, trusts or partnerships. A valuation is normally obtained on the value of the entity as a whole, or in some circumstances the valuation will be based on a party's interest in an entity.

This article details the rules that accountants need to be aware of if they are appointed as a single expert in family law matters.

What are the applicable rules?

If you are appointed as a single expert in a property matter being dealt with in the Family Court of Australia, it is important that you read and understand the relevant provisions which govern your appointment. The applicable rules are set out in Part 15.5 of the Family Law Rules 2004.

How will single experts be instructed?

If parties jointly appoint a single expert, the parties will write to the single expert with their instructions. All instructions to experts must be made in writing, and must include:

  • A formal request for a written report to be prepared;
  • Notice that the report may be used in the Family Court;
  • The issues that the expert is instructed to advise on;
  • Full and frank disclosure of information, including supporting documents to assist with the valuation; and
  • Any agreed statements of facts that need to be considered.

Provision of Information

A single expert is entitled to ask parties for all information and supporting documentation necessary for the preparation of their report. If a party has access to the information or documents requested by the single expert, such information must be provided. If the information or document is not provided, a single expert can request that the Family Court make an order under Rule 15.57, requiring a party to file and serve a document that addresses the expert's request. This document must in turn provide enough detail for the expert to adequately assess the value and significance of the information.

To make such a request, the single expert can write to the Family Court with their request, and provide evidence to the Family Court that the request has been served on each party. The Family Court will then determine the request in Chambers, unless a party objects to the request being determined in Chambers, or the Family Court decides that an oral hearing is required.

How should the report be prepared?

If an accountant has been appointed as a single expert, the report must:

  • Be addressed to both the Family Court and the parties;
  • Annex a summary of instructions given by the parties (NB. it is often best to attach a copy of the letters of instruction);
  • Annex a list of documents relied on;
  • Be verified by way of an affidavit by the expert ( CLICK HERE for the precedent affidavit for the Family Court of Australia which is to be completed); and
  • The affidavit must also include a statement in accordance with Rule 15.62(2).

Can an expert be asked questions after the report is prepared?

If commenced within 21 days of receipt of the report, the parties can enter into an agreement to have a conference with the expert in order to clarify the report. Alternatively, a party may ask questions of the single expert in writing after 21 days of receipt of the report (if no conference is held), or within 7 days of a conference having been held. All questions asked must be in writing, and a question can only be asked once. The questions must also only be for the purpose of clarification of the report, and cannot be vexatious or oppressive. The expert should not be required to undertake any further unreasonable amount of work.

If a single expert is further questioned by a party, they must respond within 21 days. The responses by the single expert must be in writing, and specifically refer to and address all questions. A single expert can object to answering a question, but the reason for the objection must be stated. These responses must be attached to an affidavit and sent to all parties, at which point the responses will be taken to form part of the report.

Cross Examination of Single Experts

A single expert will be informed by a party if they are required for cross-examination. The party is to notify the single expert 14 days prior to the trial date, and the single expert is in turn required to attend. The Family Court has the power, however, to limit the nature and length of the cross-examination.

Adversarial and Shadow Experts

It is common in family law matters for an accountant to be engaged as a party's own expert, rather than as a single expert. For example, an accountant might be requested to critique the single expert's opinions as stated in their report, or forensically examine the dealings of another party. If a party wants to rely on the accountant's evidence, they must obtain leave from the Family Court.

If such leave is granted, the accountant must also comply with the rules set out in Part 15.5. An adversarial and shadow expert may also be cross examined by the parties.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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