The Enhanced Duties and Expectations Of Experts

The December 1, 2014 decision of Justice Harper in Berta v. Berta, 2014 Carswell Ont. 12382 is a must-read for every family law lawyer and business valuator who deal with complex financial claims, including child support and spousal support and business valuations.

In this case, both parties retained experienced valuators to prepare reports that provided opinions on the husband’s income for support purposes.  The case is noteworthy primarily because of the observations and remarks of Justice Harper about the conduct and approach of the wife’s business valuator during the litigation, which led him to largely reject the testimony put forward by the wife’s expert.   

Justice Harper observed that although the wife had retained an experienced business valuator, the position advanced was “aggressive” and amounted to “a no holds barred battle.” He was particularly critical of the breadth of the valuator’s request for disclosure, which amounted to an unreasonable quest for “minutia that was not relevant to his task of providing an opinion of the income available for support purpose.”  He was further concerned that considerable disclosure which he claimed was outstanding had in fact been produced or was at a minimum available to the valuator.  

For all of these reasons, he concluded that the valuator had acted like an advocate searching for “nefarious activity” rather than meeting his duty to assist the Court on the issue of income for support. 

Justice Harper went on the explain that business valuators must diligently review documents they have received as part of the disclosure process and must not start from the premise that they are entitled to unearth every single document that might in any way tie into another document to conduct a so called forensic type review, which often amounts to nothing than an expensive and time-consuming fishing expedition.  He remarked that business valuators must approach their task with proper regard to the principles of proportionality and the probative value of the information they seek relative to the task at hand. 

Even more crucially, Justice Harper was particularly critical of the fact that though the wife’s expert was given the opportunity to talk to company accountants and the husband’s experts in order to see if they could narrow the issues, the wife’s expert refused on the basis that the wife had instructed him not to do so. 

Justice Harper strongly disagreed with this approach, and, in referring to Rule 2 of the Family Law Rules, pointed out the “duty on all lawyers, judges and all parties to deal with cases justly, and in so doing, they all owe a duty to make every reasonable effort and to attempt to settle or narrow issues…” 

In order for the opinions of business valuators to be viewed by the Court as credible and helpful, valuators must approach the task in an objective, thoughtful, proportionate and reasonable fashion.  Their key focus must be to assist the Court to address complex issues, not advocate for the party who happens to be paying for their services. 

This case is the most recent in a long line of cases over the past several years which have been critical and ultimately rejected the once common practice of retaining “hired guns” or experts who advocate on behalf of clients.

Family law counsel are well advised to be careful in retaining valuators who have a track record of objectivity, thoughtfulness and proportionality in the preparation and presentation of their reports.  Conversely, counsel should be prepared to vigorously challenge opposing business valuators who have failed to meet this recognized standard for experts.