In Family Law Property Settlements we are constantly having to find out the value of property owned by our clients. That property could be real estate, furniture, motor vehicles or many other less obvious items.
For example, over the years I have had to obtain expert valuations of gun collections, antique clock collections, watch collections, carnival rides, exotic and less exotic motor cars, jewellery, paintings, coins, antiques and numerous other unusual items.
Valuations of businesses are especially tricky.
Value of Property
There are experts available to value all of the above and any other items which need valuation. We try to use valuers who are experienced and knowledgeable, and who have given evidence in Court on past occasions. Almost always the valuation of an item which is not going to be sold can be controversial. It boils down to the opinion of the valuer based on what he/she believes the market would pay for that item of property, be it real estate, personal property or a business. The maxim is that the value of an item of property in a Family Law case is what that item of property could sell for – that is what “a ready but not anxious buyer would be prepared to pay to a ready but not anxious seller”.
We are always concerned about whether our valuer’s opinion will be preferred over another valuer if the matter goes to Court. Experience, expertise, qualifications (and sometimes a few grey hairs) will be important to impress a Judge, but more important will be the detail which has gone into the valuation.
At the end of the day a valuation can be defeated by a subsequent sale. For example many years ago I had a case in which the husband owned a Sidney Nolan painting – one of the Ned Kelly series. There was a dispute as to its value. A valuer from Sydney came down and inspected the painting and gave his opinion. In the absence of any other evidence his opinion was accepted, and the property settlement proceeded using that valuation. After the case was over the husband sold the painting for more than twice the valuation – a figure which was then a record price for a Sidney Nolan painting.
Sometimes valuers can disagree so widely that the Judge can order a sale, with the parties at liberty to bid at that sale. Usually however the Court will make a finding as to which party’s valuation it prefers. The High Court has ruled that a Judge is not permitted to take the average of competing valuations.
My experience has taught me to use the most respected and experienced valuers. They may not be the cheapest, but their opinion is more likely to carry the most weight with the Court.
Denis Farrar, Farrar Gesini Dunn.