In family law property disputes, particularly those involving assets like businesses, the valuation process plays a crucial role in determining a fair property settlement. While the Family Court often relies on expert opinions to assist in the valuation of assets, it is not uncommon for the Court to disagree with those experts, as demonstrated in the case of Gare & Farlow [2023]. For property settlement disputes, expert legal advice from a property settlement lawyer is essential.
The Case | Property Settlement Lawyer Melbourne
Ms. Gare and Mr. Farlow, who were married for 10 years, found themselves in a property settlement dispute involving a business and several properties.
During the trial in 2022, the Court decided that the net assets are to be divided in shares of 66 per cent to Ms. Gare and 34 per cent to Mr. Farlow. As part of the settlement, Mr. Farlow received one real property, certain items of personal property, and a cash sum of $410,542 paid by Ms. Gare. In contrast, Ms. Gare retained one real property, an incorporated business, and other personal assets. Ms. Gare operates F Pty Ltd (the business) where she is employed as a worker and manager.
The valuation of the business owned by Ms. Gare then became a central issue on appeal. Ms. Gare argued that her business was overvalued by an adversarial expert adduced by Mr. Farlow and the cash sum she had to pay to him was greater than it should be. Furthermore, two adversarial experts presented conflicting valuations. Mr. H, a property and business valuer appointed by Mr. Farlow, valued the business at $429,500. Conversely, Mr. G, a forensic accountant appointed by Ms. Gare was uncertain of the business’s value and ultimately concluded it was worth nothing.
The Court, however, disagreed with Ms. Gare’s expert. It reasoned that if the business was long-standing, secure, profitable, and attractive enough for Ms. Gare to retain, it could not be worth nothing. Therefore, the Court dismissed this ground of appeal. The trial judge affirmed that the primary judge made no error in relying on the expert witness evidence provided by Mr. Farlow’s valuer. The Court found this evidence to be more persuasive and consistent compared to the fluctuating estimates provided by Ms. Gare’s expert, which ranged from $56,948 to $73,057, before ultimately concluding that the business was worth nothing. As a result, the Court upheld the business’s valuation at $429,500.
The wife also argued that her contribution of $106,682, which she used to repay loans to her father, should be added back to the asset pool and credited in evaluating the parties’ respective contributions. However, the Court rejected this ground of appeal. Ms. Gare had admitted during the trial that she set aside the sum of $106,682 from her business revenue, and the judge recognised that this sum, along with the business itself, should be considered part of her initial contribution to the parties’ assets.
The Role of a Property Settlement Lawyer
If you are involved in a property settlement dispute, especially where business valuation is involved, the guidance of an experienced property settlement lawyer is invaluable. At Rowan Skinner & Associates Lawyers, we work closely with our clients to ensure that their assets are accurately valued and that they receive the best possible outcome in their property settlement. We understand the challenges that can come with asset valuation and are committed to providing expert advice tailored to your unique circumstances.
Rowan Skinner is an accredited Family Law Specialist and property settlement lawyer with over 35 years of experience. Contact us at (03) 9995 9155 for a non-obligatory consultation and legal advice on property settlement. We service clients in Melbourne, Melbourne Northern Suburbs, such as Northcote, Alphington, Carlton, Fitzroy, North Fitzroy, Kew and Heidelberg, as well as South Melbourne and South Yarra.
Rowan Skinner is a highly skilled family lawyer with over 35 years of experience across various legal roles and jurisdictions. Rowan specialises in resolving family law disputes such as divorce, financial settlements, child custody and domestic violence cases. Through his diverse and extensive experience, Rowan has a deep understanding of the complexities and nuances involved in family law. Rowan is a skilled negotiator and litigator who follows a compassionate and client-focused approach which prioritises helping you navigate what can be an emotional and challenging time.