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Did COVID-19 diminish the value of assets?

In the matter of Pericles and Hopman (9 June 2020) the husband sought to re-open his case to adduce fresh evidence – purportedly to support the argument that the Australian economy is experiencing a significant downturn as a result of the effects of Covid-19 and the Court should take notice of the economic effects of Covid-19 on the value of the assets available for division between the parties.

Justice Bennett noted that in deciding whether to allow fresh evidence the Court had to consider whether:

  • The further evidence is so material that the interests of justice require it;
  • The further evidence would most probably affect the result of the case;
  • The further evidence could have reasonably been discovered earlier; and
  • No prejudice would flow to the other party by reason of the late admission of the evidence.

Her Honour considered the decision of Justice Murphy in the case of Summitt & Summitt and Others 2009 – which was a case in which one party sought to re-open to adduce further evidence about the financial impact of the GFC on the parties’ assets. In that case the husband had obtained a new valuation from a different valuer – but Justice Murphy did not allow the new evidence on the basis it did not show that the factors impacting on the value were different than that which had been considered at trial – and that prejudice would flow to the wife if she was required to pay for representation if the trial was re-opened. 

In the matter of Pericles and Hopman the husband had not obtained a new valuation – and while Justice Bennett stated that such a new valuation was not a necessary pre-requisite the husband through his own evidence had not otherwise satisfied her that there had been a fall in the valuation of assets to a degree that can properly allow the re-opening of the case. Because of not meeting the first two hurdles Her Honour only briefly considered the latter two – but did agree with the Husband that he could have not foreseen the Covid-19 pandemic and therefore could not have adduced the evidence at the trial; however Her Honour also concluded that prejudice would likely have flown to the wife if the matter was re-opened as she was not in the financial position of the husband and would have experienced hardship.

Her Honour ultimately dismissed the husband’s application and awarded the wife costs in relation to the hearing.

 
Liability limited by a scheme approved under Professional Standards Legislation

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