Valuation, Litigation, and Lessons in Law with Claudio Martellacci

Hello, everybody. Welcome to another episode of Studying Law Around the World. Today we have the opportunity to be hosting here Claudio Martella Occhi. Claudio, thank you so much for joining us today. Yeah, thank you very much for for having me. It's it's a pleasure to meet with a fellow Claudio. They only make good ones with that name. That's right. Absolutely have to agree with you on that one. And a very cool thing is that in the last, you know, I, I think maybe 20-30 episodes, I basically spoke with lawyers only in the podcast. And I'm so glad to get the chance to speak with you today and just start off our conversation today. Could you introduce yourself to our audience? Yeah, yeah, I'd love to you. So like I heard about you on on sort of LinkedIn and and through a couple of colleagues that you I think you've interviewed already and I noticed that you kind of working away from the last night. I thought it might be cool to speak to someone like me was sort of law Jason right. So I am a chartered accountant. I'm a chartered business valuator. I did nine years and really personal property tax and audit, most recently KPMG and then I switched over really into evaluations and litigation support. And so I do it a ton of litigation related work. My projects in particular is probably 60% litigation support based and we cover, you know, matrimonials, shareholder disputes, commercial litigation, damages, quantification, a little bit of personal injury and then the state litigation as well, right. And so, you know, we were a lot of a lot of different hats and we do a lot of work in that in that space. And so I thought it might be cool for you to see, you know, what an expert witness is, is sort of like and that's what we do typically have those cases. Well, that sounds amazing. And if I were to ask you to, you know, kind of go back to the beginning, what first, you know, sparkle that interest for you in accounting and business valuation, did you just grow up thinking you just wanted to be a CPA? So bad. Oh no, no, no, no. Far, far, far from it. So I was a bit of a. You know. How to, how to put it. I wasn't the most responsible high schooler, I would say, you know, my marks weren't the greatest, you know, in the first couple of years anyway. And I sort of found my stride in Grade 11. And I found it honestly in accounting class. I, I took to it naturally, for whatever reason, I liked it. I was very good, marks were very high. And I thought this is kind of cool. So I took it again in grade 12. And again, I, I did enjoy it And you know, I, I found it a bit of a, a niche for me. You have to be a certain level of nerds or they like accounting and I consider myself that level of nerd for sure. And so, you know, I did well and I thought, wow, let me look into this as a potential career path. And I, I realized that all the doors, it remained open. And one of the reasons why I found it so valuable is because I actually didn't know what I wanted to do with my life for the longest time. It probably took me longer than most, and I'll get to that a little bit later, but probably until I was in my early 30s where I figured out, Hey, this is what I really want to do, right? And it was really the flexibility that the CPA designation of the accounting experience and expertise provides you because you can really get into any field with sort of that the backdrop, right? And that was really, I just wanted to give myself as much flexibility to keep as many doors and windows open as possible because, you know, it's a big wide world of life and career out there. And I didn't know what I wanted to do for the longest time. That's that's kind of spark. It that sounds great and with, with your career, kind of looking over, you know, your bio online, you're LinkedIn and all of that. I saw you have a background in, in multiple areas. You just mentioned all the flexibility that the designation gives you, but you know, included audits, tax compliance, financial reporting. Were there any key moments that that really shaped that career path, either confirming that you really wanted to do that or things that, you know, I really don't like doing that, I'm going to do something else. Yeah, that's a great question. Key moments when I left. So I was working at a firm called the College Barrow Bond, which was in bond and later became Bigger Tilly Bond and got bought by KPMG where I eventually worked after. But I was there for about 2 1/2 years and I learned a lot. The personal corporate tax and audit, I felt like I needed to kind of grow and I thought that the next step would be to kind of work for, you know, in in the industry space, not in public accounting anymore, right? Work for like 1 specific company. And so I enough and I got a job at a company as an assistant controller and I hit and no offence to the company or anything, it just wasn't that wall was for me. I realized that a lot of the things that I thought stressed me out about was accounting. I really like a lot. I like jumping around from project to project. I'm working on different different companies files, you know, every two weeks and really bouncing around a lot. The pace and the variety was what made it so attracted to me and what I liked so much. And so I didn't really realize that until I left. Now what what the clarity was when I left and that ultimately came back to work for KPMG was that I needed something a little bit more than just audit and personal corporate tax. I'm like, what will that something more be? So I thought, what can I stack on to my CPA designation that sort of builds it? And I thought of the CBV, the CFA and the NBA and I thought NBA too similar and probably not as as good overall compared to the CPA. So that's out. And the CFI I thought interesting, but we're probably cannibalized a lot of my accounting experience and background. So that doesn't really work either. Another I looked up at the CBD and and I had done one project because my old boss wasn't CB. We did one valuation together and it was, it was a litigation based and I thought it was so cool. So I dug more into it. I thought, wow, this is really, really cool. I didn't even know this existed, that accounts could do this. And I enrolled in the program even before I started keeping G and I called them, you know, I'll give you 3 busy seasons here in an audit, you know, to be a good soldier. But I want to eventually like get into the valuations department and, and really go full on with this, like I, I want to be evaluated, right. And and that was probably the, you know, the bit of a long winded answer, but that was the the key moment was kind of leading public accounting and then coming back to it and realizing I want to take this other step and move forward that way. Awesome. So just here to clarify for the audience to the CBV, the Chartered Business Valuator and just for tax, do you need to be already a CPA in order to do that or how does that work? You do not actually, no. You can go directly into the CVD stream. There's a lot of again, congruency between CPA and CPP needs a lot of personal attacks knowledge like it helps. I don't think you need it, but it is definitely helpful. A lot of accounting knowledge. Obviously when you're CV, the main document you're looking at her college statements and trial balances, right? So you know, if you're, if you're accounting background, obviously that stuff is a little bit more familiar to you than if you were or not, but it's not, I would not say it's a requirement in any respect, right? They started to build upon each other. Whichever 1 you have or do first, the other one would still build upon, you know, if you were to do it 2nd. And you really don't need to do the CPA at all like if you want to be CPD, but I wouldn't say like it would definitely sharpen your skills if your goal, right? There's no question. So yeah, that's that's that's what it is. Fantastic. Well, thank you for, for clarifying that. And the, the more we look into it, it seems like accounting in the law overlap more and more. So I'd love to hear more about Guido, the work you do, the, the business valuation, the legal matters. I, I was just thinking as I, as I prepared for this, right. But I, I'm guessing for, you know, the solo lawyers, they have to do a lot of the, a lot of the things end up being on on their own right, like from the, the accounting for the firm itself all the way to each of the cases they work on. But I'd love to hear a little more about your role on that. Yeah. So that's funny you mentioned that. So obviously we're a full service accounting firm. We do a number of, you know, typical sort of nuts and bolts accounting services for lawyers and professionals across the board, whether they be doctors, dentists, but you know, lawyers, all the above. But my department specifically is valuations and litigation support, which is probably a bit of a misnomer because we really are like quantification, really, anytime you need a number, we're sort of, you know, the, the team to call, so to speak. And, and you know, often in litigation matters that the primary concerns are financial. And when their financial, that's where we really, you know, can help out with the flesh out that sort of the answers or at least provide some sort of path towards resolution. So for example, how we do a lot of matrimonial work and in the matrimonial space will do, you know, income calculations for support purposes and we'll do valuations of businesses and even preparation or assistance with preparing the Form 13.1 financial statements. So that's your sort of personal financial statement when you are in a divorce matter. And that combines something called the net family property statement, which is how you determine the division of assets and the old ultimate equalization between the two parties when they split, right? So we are very well adapted and very, you know, enthusiastic about putting us up together. And again, in order to bring resolution, right. So we like to provide some clear answers. That's some clear paths forward. You know, things like divorce are very, very sad, very difficult parts of people like. So from my perspective, it's always been about taking, you know, helping someone get through something very difficult in the way that I can. So I appreciate that we're not, we're not, we're not saving people's lives on the operating table here. You know, we're not the doctors of the world really, really making the most impact, but, you know, in our own little way, this is where we contribute to, you know, making people's lives better, right? That's that's sort of what gives me to it for me for that. But that's not true, right? And then you've got like state litigation where, you know, beneficiaries might be fighting over, you know, a certain certain states assets, maybe all the assets, maybe some of them and how they were divided. States I always refer to as sort of like a choose your own adventure. You never really know what you're going to be asked to do at the beginning within the state matter to help resolve it. And a lot of times we work with council really for both sides to figure out like what is the best way to do that. And we also work with our task consultant department, which is sort of in lockstep with ours, to figure out a way that we can kind of value the assets or provide a quantification of whatever they need us to and then to distribute the way that's very tax efficient. And the example I always give is, you know, I can say this stuff is worth $5,000,000. And then our tax department's job is to kind of make it feel like 5 and a half, $1,000,000 for the beneficiaries, right? By distributing things in a very tax efficient manner, right? And that's, that's the value we try to provide to our clients. And really one of the main things about our firm that made us very attractive. We're sort of a one stop shop for this kind of stuff, right? And not, not many firms are, frankly, we're, we've grown a lot. We're 100% firm now. You're probably around 18, about 4 1/2 years ago when I when I joined and yeah, just, you know, we've been off to the races that and a lot of growth, very dizzy, but it's been amazing and made a lot of impact I think in the market and people's lives. And that sounds so great. And I guess it ties a lot to the to the personal story that you had on figuring out what you like. And then once you find that very useful of a profession for sure, and in a designation that you know, makes sense for you, taking all of that into consideration, you know, thinking about young lawyers like lost students right now who are also trying to navigate different spaces and maybe even consider a nonlinear career paths for for law. Yeah. You mean it like a a lawyer trying to get into that kind of thing or a lawyer engaging with or networking with those type of people that they they have sort of that at their disposal if the case needs? No, at friends laughing about, you know, young, young lawyers were like, you know, I don't wanna do the lawyer thing. The law degrees very useful. I love it, but I don't think I want to be a lawyer. And then maybe going into that, and you know what, why don't we talk about both of the options? Yeah, sure. I mean that's very existential for sure. Like if you're a lawyer and you want to get into that side of things. I always find, you know, for whatever reason that my wife is a lawyer as well. And it's like I'm allowed to say this. A lawyer is in now don't always I feel like light up very well together. And that's frankly why I'm I'm employed, I think and why my my designation is service package exists and is attractive in the 1st place. I think that lawyers should veer more into sort of the the theology and and you know, the real dirty, gritty, you know, arguments behind, you know, positions, right, whether it be two or more on a given matter, right. And sometimes they need that's worried about the number they're worried about their their own position stance, right, based on certain set of case facts. Lawyers, I always feel like are more like puzzle oriented that way, right? Whereas, you know, people like us, the number, the number of guys and gals are a little bit more structured in that regard for what we said. Like, you know, we really want to break everything down into the dollars spent. Sometimes Gerard detriment, like I, I have a joke actually, but I always say you're on in my role, sort of 60% account, 20% lawyer at 20% therapist, because you know, with the States and and matrimonials, the reality is if they're very emotional, right? And the lawyers will definitely know this, obviously, like it's such emotional work. You have such, you know, personal conversations with, with really everyone involved because you're just you're digging into their life, right? Like, oh, how did you split, you know, annual expenses with your husband or wife, right? You know who paid for what, you know, they pay you a salary out of their business, right. Like a lot. There's a lot and get, you know, even more, more in depth from there. But I probably can't share on the call. But you know, when you get so ingrained with it, it's just, you know, you, you have to have sort of a different perspective. And while the two things are very similar, being that, you know, about litigation account, you know, 60% of the time they're just very different. Yeah. For, for I guess a lawyer that wanted to try their hand and going through the account. Be my guest. Feel free to reach out. But you're probably you are probably already picked the right? Path amazing going on the other route we just talked about you know how do you you know build these relationships with expert witnesses and all of that I I know that there is some sort of a there must be some sort of like an A non that close of a relationship because. That's interesting, right? I'd love to hear about, you know, the networking and all that. Yeah, it's professional services, right? So The thing is, you know, you can market it like crazy and you can have the greatest website and LinkedIn profile, yadda yadda. And the reality is word of mouth is still sort of the number one, the networking tool and business tool, right? And your delivery is the best marketing that you can do. You do well on your files. People say, yeah, you know, I've worked, you know, in my case, I worked with this guy Claudio, and he did a really good job on the style of never witnessed. You know, to you that like that kind of stuff is important. That's really it. Like I would reach out to basically others in your space, right, and say, have you worked with any good valuators you and all of any that are recommended that you gotta, I mean, you could do the Google search thing as well. Like that's not like that. Well, you could read up on my Leathan profile and you know, host of others, right, and, and websites and things like that to do your research. I encourage you to do it. If you're you're a lawyer in in sort of the litigation space or even not even solicitor space where you have to quantify things sometimes and it may be a little bit over your head. Getting the accountants involved earlier is generally better. It's less costly. You won't spin your wheels trying to figure out what to do. Typically get will have the answers and you can kind of lay out the thought and it's just more efficient. It's always better, you know, to provide that that kind of full package service to your clients. It won't always be apparent on the first case for the second case, but ultimately, if you kind of know what to do and give the situation, even though it's not your specific expertise and knowing what to do might just be simply OHI should call, call that violator again, right? That might be enough to get the job done and do good work for your client, right? That at the end of the day is what you're trying to do as a profession, trying to provide, you know, good quality service and that will build your own sort of brand and your and your business and your career from there, right. It's easier than it than than it really sounds. I guess you just got to do it. It's a contact. Sport. That's awesome. And I think it aligns the lot with with the whole story you've been telling us about how you got to where you are today. And maybe even is that your personal belief? If you were, you know, to tell yourself from, you know, 10 years ago, just try it out, see if you like it. Is that what you'd recommend? Yeah, 100%. Like you just gotta do it. You know, It's not, it's a bit related to sort of imposter syndrome where people always feel like, you know, they're, they shouldn't be in the role of they're in or they don't deserve it. You know, if you if you challenge yourself from life, you always kind of feel like that at some degree, right? You almost should feel like that, right? Because that's how you know you're growing. If you're sort of in unchartered waters a bit like, you know, you're expanding your horizons, you're getting smarter, You don't you feel it yet or you're not so confident, right? And that's not to say like it's not really fake it till you make it. No, if you're a diligent professional, you do the work to better understand something. Everything is a puzzle. Every case we get, for example, you know, there's parts of it that are a little bit over our head on day one. And then we wrap our heads around when we think about it, we do our research, we look at case law and we, we look at, you know, other things we've done in the past. We come up with a reasonable answer. That's well thought I would support it, right? You don't get to get there. It's not like when you write the exams and you know, you have 4 hours to, to come up with answers to, you know, 3 cases and you get, you know, 15 minutes each or whatever or what have you, right? This is the situation where you have usually have some time, you can do some research, you could apply it, right and apply your knowledge. If you're, if you're doing that, you're a good profession, right? That's, that's really the mark of a good question. We should be doing the research, doing doing your diligence on your files, right? You're not always going to have the answer right away. No one's got encyclopedic knowledge like that. If you think you've sort of met partners in your life that do, the reality is they they attain that over like 20, 30-40 years of experience, right? They made many, many mistakes in their 20s and 30s. Just like, you know, you and I will, right? And you know, that's again, that's par for the course, right? Sometimes that that's lost on sort of the under professionals think, wow, you know how my partner and my group get so smart. Well, you been doing this for three years and they been doing it for 30. That's really the difference, right? You'll see 27 years. From now. That's right. No, I firm believer that you have to do something repeatedly to get really good at it. We were just talking at work the other day about, you know, how class actions really help out because you just have to do basically the same thing so many times that it's almost hard not to get good at it or not to understand how it all works. Because at the end of the day, you're just doing the same thing so many times, right? Absolutely. I, I could speak from personal experience, like earlier in my career when I worked, I mentioned Collins, Gerald Vaughn. I, it was a smaller firm, so the clients were smaller and usually worked on like the entire file from beginning to end, right. And, and sometimes they keep you MG's of the world. You don't do that. You work on your specific subset like your PNG. I was, you know, I had audit clients and I worked on the audit and that was one of the few that also did a little bit of the personal, sorry about the corporate tax, but usually it was just audio, right? That calls Borough Lawn. It was always everything. So the audit, the corporate tax returns, the nasal statements for the holding companies, the personal tax returns, the whole sort of cycle, right? That kind of comprehensive experience that you get in sort of smaller mid-size firms is vital, right? And you know, you could argue that it's more, more important than something you might get a bigger firm that I don't want to know my, my period, the KPMG was, it was excellent and you know, I'm very grateful for it as well. But it was just you kind of figure out what the, what right fit is in your career. And my right fit has always been sort of on the smaller, medium sized clients. And that's why, you know, the firm that I'm with is, you know, sort of that. That target right you find your niche as as you move through your career. Fantastic. Well, Claudia, thank you so much for taking the time to to share this insights with us today. And thank you guys for tuning into today's episode. Sounds good. Thank you so much. We'll see you around.