Re-opening proceedings before final orders are made

Once a Trial has concluded, it may be many months (or longer) before Judgment is delivered and orders made.

In that time, new evidence may come to light which, if put before the Judge, could affect their decision.

In this article I look at the legal principles which govern the “re-opening” of a matter after Trial, but before final orders are made.

The question arises most often in parenting proceedings in the Family Court. However, I will instead consider the issue in the context of financial proceedings, and in particular where a party seeks to re-open because they wish to put further evidence before the Court.

The legal principles

In Reid v Brett [2005] VSC 18, Habersberger J said (citing others):

The criteria governing the exercise of the discretionary power to re-open a case to admit further evidence where the hearing has concluded but judgment has not been delivered have been said to be as follows:

(a) the further evidence is so material that the interests of justice require its admission;

(b) the further evidence, if accepted, would most probably affect the result of the case;

(c) the further evidence could not by reasonable diligence have been discovered earlier; and

(d) no prejudice would ensue to the other party by reason of the late admission of the further evidence. (citations omitted)

In Smith v New South Wales Bar Association (1992) 176 CLR 256; [1992] HCA 36 their Honours Brennan, Dawson, Toohey and Gaudron JJ said:

[27] It has long been the common law that a court may review, correct or alter its judgment at any time until its order has been perfected. …The power is discretionary and, although it exists up until the entry of judgment, it is one that is exercised having regard to the public interest in maintaining the finality of litigation. Thus, if reasons for judgment have been given, the power is only exercised if there is some matter calling for review. …And there may be more or less reluctance to exercise the power depending on whether there is an avenue of appeal. …It is important that it be understood that these considerations may tend against the re-opening of a case, but they are not matters which bear on the nature of the review to be undertaken once the case is re-opened… (references omitted)

[32] If an application is made to re-open on the basis that new or additional evidence is available, it will be relevant, at that stage, to enquire why the evidence was not called at the hearing. if there was a deliberate decision not to call it, ordinarily that will tell decisively against the application. …But assuming that that hurdle is passed, different considerations may apply depending on whether the case is simply one in which the hearing is complete, … or one in which reasons for judgment have been delivered. …It is difficult to see why, in the former situation, the primary consideration should not be that of embarrassment or prejudice to the other side. …in the latter situation the appeal rules relating to fresh evidence may provide a useful guide as to the manner in which the discretion to re-open should be exercised.

In a Family Law context, the issue arose in the case of Summitt & Summit and Ors (Re-opening) [2009] FamCA 365.

Prior to Murphy J delivering his judgment, the husband applied to re-open the proceedings to adduce new valuation evidence because “the values of the relevant real properties had significantly reduced due to the impact of the global financial crisis, and also, the ongoing drought and problems associated with the lack of water available for… the farming operation.“

Murphy J, in deciding whether to re-open the case, summarised the applicable principles as follows:

[14] In a case involving an application for settlement of property, it can broadly be said that common law principles govern applications to re-open in this Court. (see eg Gelley & Gelley(1992) FLC 92-290 and the cases there discussed).

[15] Those principles make it clear that the granting of leave to re-open is discretionary. That discretion is guided by the interests of justice. The essential question is, is the court more able to do justice in the facts and circumstances of the particular case if the application is granted. (see eg Smith v NSW Bar Association [1992] HCA 36; (1992) 176 CLR 256; Urban Transport Authority v NSEISER (1992) 28 NSWLR 471 at 478 and EBv CT (No. 2)[2008] QSC 306)

[16] In cases where reasons for judgment have not been delivered, the High Court has held that the primary consideration should be embarrassment or prejudice to the other side. (see Smith above)

[17] A recent decision of the Supreme Court of Queensland, EBv CT (No. 2) [2008] QSC 306 was referred to by both counsel for the husband and wife. That case involved an application for property settlement under (then applicable) State law with respect to a de facto relationship. In that case, Applegarth J summarised, by reference to earlier authorities, the (common law) principles applicable to a re-opening:

[2] The guiding principle in deciding whether to grant leave to re-open is whether or not the interests of justice are better served by allowing or rejecting the application. Reference is made in Finbrough Investments Pty Ltd v Airlie Beach Pty Ltd and in the cases referred to in it to the need for finality and litigation.

[3] In Smith v New South Wales Bar Association the High Court stated that different considerations may apply depending on whether the case is simply one in which the hearing is complete, or one in which reasons for judgment had been delivered. As to the former situation, the Court said it was difficult to see why the primary consideration should not be that of embarrassment or prejudice to the other side.

[4] In Reid v Brett the criteria governing the exercise of the discretionary power to re-open a case to admit further evidence where the hearing has concluded but judgment has not been delivered, was said to be as follows:

The further evidence is so material that the interests of justice require its admission;

(b) the further evidence, if accepted, would most probably effect the result of the case;

(c) the further evidence could not by reasonable diligence have been discovered earlier;

(d) no prejudice would ensue to the other party by reason of the late admission of the further evidence.

[footnotes and references omitted]

[18] In addition, his Honour held that:

[5] Reference by the High Court to prejudice to the other party, and the guiding principle of the interests of justice, require account to be taken of the strain that litigation imposes on personal litigant[s]. The prejudice caused by delay in the delivery of an expected judgment at the end of stressful litigation can not always be measured in terms of money or cured by an order for costs. The interests of justice is served by finality in litigation, particularly where prolonged litigation imposes a strain on personal litigants.

[19] I consider that that is particularly true of litigation in this court generally, and in this case specifically. I will return to this issue below.

[20] The decision just referred to involved a claim, under the Queensland legislation then applicable, for property adjustment in the context of a de facto relationship.

[21] His Honour considered that, in determining that application, the property of the parties and its value should be determined as at the date of the hearing. That principle is applicable, generally speaking, to applications for settlement of property pursuant to s 79 of the Family Law Act 1975. In the context just described, his Honour went on to say:

[6] The application to re-open is not to overcome a technical defect in the evidence or to tender evidence that is omitted by inadvertence. The application seeks to raise a new issue, namely the current value of certain assets of one of the parties, whereas the issue litigated at the hearing of the assets, financial resources and liabilities of the parties as at the date of hearing. It is impossible to see how the respondent could be permitted to call evidence of the current value of some of his assets without, in fairness, opening up the general issue of the current value of the parties’ assets. To do otherwise would be to fall into error. It would be wrong to determine the matter on the basis of the current value of some assets and the value as at the date of hearing of the balance of the assets.

[22] However there are, here, significant points of distinction. This is not a case (as was the case before his Honour) where the application is to allow the re-valuing of the property of one party only. However, his Honour goes on to say (at [7]) that:

“… the relevant issue is the value of the parties’ property at the date of the hearing. The interests of justice do not require the admission of the evidence to determine that issue. It is contrary to the interests of justice to re-open the evidence to enable the value of the assets to be re-assessed at dates after the respondent’s case has closed and after the hearing was concluded.”

[23] Without expressing any view of what the position might have been in respect of the then relevant Queensland legislation, it is necessary, I think, to be a little more circumspect about the position in respect of s 79 applications under the Family Law Act. It has been said for example (albeit in a different context) that: “… in addition to the date of the hearing, the value of property at other dates may be important.” (Australian Family Law, Lexis Nexis, Vol 1, [79.113]). That is because, primarily, the nature of contributions can change. Thus, the issue at a trial may be broader than simply the value of property at the date of the hearing.

[24] That said, it is equally true to say that the date of hearing is almost inevitably an important date for the ascertainment of the value of s 79 property and very frequently – as was the case here – used as the relevant date for the purpose of ascertaining the value of “the property of the parties or either of them” within the meaning of s 79.

At paragraph 54, Murphy J went on to say:

[54] To the extent that value is determined at the date of hearing (or any other relevant date) for the purposes of s 79 applications, it is, axiomatically, arbitrary in the sense that it involves the assumption of values at a particular snapshot in time.

[55] Moreover, it will almost inevitably be the case (and was the case here) that there will be a time lag between the date of valuation and the date of hearing. Thus, whilst the “date of hearing” is spoken of as being the date upon which values are often ascribed, it is, in fact, almost always (and was here) an earlier date – i.e. the date when the valuation was obtained.

[56] That is likely to be all the more true when, as is the case in this court, the Rules provide that, in the usual course, a single expert valuer is to be used; joint instructions need to be settled and the valuation received by both parties (and the court) in good time for the trial. The trial valuations here were dated approximately July 2008 (ie they reflect values at a time about four months prior to the trial).

[57] The assumption at trial (in the absence of evidence to the contrary) that values have not moved in the period between valuation and trial involves the assumption – or, at least, the acceptance – that whatever economic and other exigencies may have been present in that period will be ignored for the purposes of arriving at the value of property at the trial.

[58] The increasing complexity of matters confronting the courts, when merged with a judge’s desire to write a considered judgment, sometimes results, regrettably, in a delay between trial and judgment. As Campbell J said in King Investments Solutions Pty Ltd v Hussain and Another [2005] NSWSC 1076; (2005) 64 NSWLR 441 at [164] “… [the realities of] the case listing procedures of the Court force judges to write reasons in whatever odd corners of time are left over from their other duties …”.

[59] Often, that delay might encompass the occurrence of the sorts of exigencies just referred to. That will not, usually, result in a case being re-opened. Finality in litigation is a powerful component of the interests of justice.

[60] In assessing the materiality of the evidence sought to be led by the husband at a re-opened trial, the starting point is the trial itself. There, evidence from [an expert other than the single expert witness valuer] could not have been led without the court’s permission (Family Court Rules 2021). A (relevant) factor in the court granting any such permission is that “another expert knows of matters, not known to the single expert witness, that may be necessary for determining the issue” (r. 15.49(2)(b)) or that there is some other “special reason” for adducing the evidence (r. 15.49(2)(c)).

[61] [The expert valuation evidence that the husband seeks to adduce if the matter is re-opened is based on the same sorts of considerations that informed the single expert witnesses valuation which was relied on at Trial].

[62] That fact points, in my judgment, against the materiality [of the further expert evidence the husband seeks to adduce].

…

[64] Yet, it is the husband who assumes the burden of establishing the requisite injustice so as to re-open the trial in the context of the factors, including finality and potential prejudice including stress, that might otherwise point against it.

…

[66] It seems to me incumbent upon the husband to satisfy the court that [the further expert] evidence is, in terms of its materiality, of such a nature as to be more than simply another expert opinion which, if sought to be adduced at the original trial was unlikely – on the surface of it – to have satisfied the requisite test for admission under the Rules. (emphasis added)

[67] Specifically, it seems to me essential for the husband to adduce cogent evidence to show that facts or factors impacting on value now are different from facts or factors impacting on value at the trial and that it, or they, are material to the decision and need to be taken into account to prevent injustice. (emphasis added)

[68] It is in my judgment not sufficient, in that respect, to adduce, without more evidence that valuer A says that the properties are now valued at $x whereas valuer B said, eight months previously that they were valued at $y, particularly where there is no question that $y was accepted as their value four months prior to them being valued at $x.

[69] If that is so, it is in my view not to the point that arguments can be mounted (as was done by the husband here) showing that, if $x is accepted as the value, then the application of specified percentages will result in significantly lower entitlements than if the value of $y is employed.

[70] In my view, the evidence adduced by the husband and the argument based upon it can be encapsulated in the manner just described.

Murphy J then went on to consider the injustice that would be caused to the parties if the proceedings were (or were not) re-opened. Of material concern to His Honour was the wife’s evidence that she had little financial capacity to meet the costs of a new Trial. At paragraph [88] His Honour said:

It is by no means clear that the wife would be able to avail herself of the legal representation of her choice – or any legal representation – at a re-opened Trial. In circumstances where, as the husband deposes “the proceedings have been ongoing for a number of years” and where the wife has been represented by the solicitor and counsel of her choice in the lead up to, and at the trial of this action, the potential for her to be unrepresented at any re-opened trial (or alternatively not to have the representation of her choice) is, it seems to me, a very significant potential prejudice.

Murphy J then concluded (at [91]) that he was “not persuaded that the interests of justice are better served by allowing the application to re-open“, and dismissed the husband’s application.

Further reading

The following is a list of cases that have dealt with the issue of whether to re-open, decided after Summitt:

• Cook & Cook (No. 6) [2010] FamCA 810 – leave to re-open granted where a liquidator and receiver was appointed in respect of marital property following the conclusion of Trial.
• Bulleen & Bulleen (No. 3) [2010] FamCA 859 – wife’s application for leave to adduce new valuation evidence refused.
• Elgin & Elgin [2012] FamCA 898 – husband’s application for leave to re-open refused, in circumstances where he sought to adduce new evidence of the “actual” sale price of a real property.
• Reece & Dawkins [2013] FamCA 665 – leave granted to the de-facto husband to re-open, to adduce further evidence relating to a sum of money held in a term deposit (allegedly on trust for his mother), after he mistakenly failed to account for it at Trial.
• Jackson & Shea [2013] FamCA 692 – leave granted to the wife to adduce evidence from her mother as to the “proper assessment of the assets and liabilities of the marriage” – namely the constitution and nature of certain family trusts.
• Bennison & Bennison [2015] FamCA 243 – the husband applied to re-open the proceedings to adduce evidence of his medical condition (terminal malignant melanoma) and changed financial circumstances. The wife did not oppose that application.
• McDermott & McDermott & Ors [2016] FamCA 613 – leave granted to the husband to re-open his case to adduce evidence of his use and disposition of a company and partnership funds, where the sums involved “are not trivial but significant”.

Comment

The question of whether a case should be re-opened is complex, with many competing considerations.

What is apparent from the decisions of Summitt and Bulleen is that the mere change in value of property following the conclusion of a Trial does not in itself provide sufficient grounds to re-open a case so a party can adduce further valuation evidence.

The above does not constitute specific legal advice but is general information only.

(References to cases in this article are to versions that are freely available on Austlii)