Adams and Adams (No. 9)

[2007] FamCA 1438

FAMILY COURT OF AUSTRALIA

ADAMS & ADAMS (NO. 9) [2007] FamCA 1438

FAMILY LAW – COSTS – Child representative

Family Law Act 1975 (Cth)

In the Marriage of Kohn (1977) 30 FLR 175
LAC and TRF and LKL [2005] Fam CA 158
Brown & Brown (1998) FLC 92-822 at 85,347
Pension & Pension (No. 2) (2005) FMCAfam 22
Adams & Adams (No.7) [2007] FamCA 293

APPLICANT: Mrs Adams

RESPONDENT: Mr Adams

INDEPENDENT CHILDREN’S LAWYER: Donald S Lampe

FILE NUMBER: MLF 2456 of 2006

DATE DELIVERED: 13 December 2007

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Bennett J

HEARING DATE: Written Submissions

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr A Combes

SOLICITOR FOR THE APPLICANT: Jane Baldwin

COUNSEL FOR THE RESPONDENT: In Person

COUNSEL FOR THE INDEPENDENT CHILDREN’S LAWYER: Mr R Hoult

SOLICITOR FOR THE INDEPENDENT
CHILDREN’S LAWYER: Donald S Lampe

Orders

1. That the husband pay and be responsible for 70% of the costs of the independent children’s lawyer for all but one day of the trial which commenced on 5 February 2007 such costs being fixed in the sum of $21,800. 

2. That the husband pay and be responsible for 70% of the costs of the wife for all but one day of the trial which commenced on 5 February 2007 such costs being fixed in the sum of  $21,217.

3. That, save to the extent that:-

   (a)$20,000 of the monies held pursuant to paragraph 3 of the Order made on 20 February 2007 may be applied in partial satisfaction of costs owing to the independent children’s lawyer pursuant to this order, and/or

   (b)$20,000 of the monies held pursuant to paragraph 3 of the Order made on 20 February 2007 may be applied in partial satisfaction of costs owing to the wife pursuant to this order –

   paragraph 3 of the Order made on 20 February 2007 continue in full force and effect pending further order of the court. 

4. That the costs applications of the wife and the independent lawyer be otherwise dismissed. 

IT IS NOTED that publication of this judgment under the pseudonym Adams & Adams is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 2456 of 2006

MRS ADAMS

Applicant

And

MR ADAMS

Respondent

And

INDEPENDENT CHILDREN’S LAWYER

REASONS FOR JUDGMENT

1. For 15 days in February 2007 I heard proceedings arising out of parenting applications between the husband and the wife and I reserved my decision. 

   
   

   I made orders and delivered reasons for judgment on 17 September 2007.  My orders included:-

   12. That subject to any further order of the court, paragraph 3 of the Order made on 20 February 2007 continue in full force and effect until

   
   23 November 2007

   or my determination of any application of, or with respect to, costs of these proceedings.

   13. That any party wishing to seek costs of or incidental to the parenting proceedings file and serve submissions in writing to that effect by not later than 5 October 2007 including, but not limited to, an itemised memorandum of the costs sought calculated in accordance with the scale set out in the Family Law Rules 2004.

   14. In the event that any party seeks costs against another party, the party against whom costs are sought file and serve any written submissions in opposition thereto by not later than 26 October 2007. 

   15. That any submissions in relation to costs be limited to five (5) A4 pages in length excluding any memorandum of costs on the basis that I will not give consideration to the sixth and any successive pages of any submission.

2. The purport of the Order made by me on 20 February 2007 was to freeze $40,000 of monies invested in the name of the husband or the child with Commonwealth Bank. The case neutral citation for that decision is Adams & Adams(No.7) [2007] FamCA 293. Pending this decision, the Order is still operative.

3. The costs submission of the independent children’s lawyer was filed on

   
   3 October 2007

   . 

4. The costs submission of the wife was filed on 4 October 2007. 

5. The husband makes no application for costs but filed a written submission on 26 October 2007. I suppose that I could infer that the husband could be opposing the costs applications of the independent children’s lawyer and the wife because, pursuant to paragraph 14 of my Order made on 17 September 2007, any submissions opposing a costs order were to be filed by 26 October 2007.  However, as the husband’s submission (or such as I have of it) goes for four full pages of text and does not once refer to the costs applications of the other two parties nor any of their contentions, I do not take it to be a submission in opposition to the applications for costs. I describe the submission or so much as I have of it because it ends at page 4, paragraph 32 and appears incomplete.  As set out above, I limited the submissions to 5 pages in length.  In this document the submissions comprise four full pages and three pro forma pages which are completed in pen. 

6. The husband’s submissions ramble and are largely unintelligible. Insofar as

   
   

   I can identify a subject matter the submissions appear to be directed to the decision which I made on 20 February 2007 to freeze $40,000. If that is correct, the husband’s submissions relate to the enforceability of any costs liability which I impose on the husband and, accordingly, are premature at this point.  First, I must determine whether the husband should be required to pay the costs of any other party to the proceedings. 

7. The applicant wife and the independent children’s lawyer each seek that the husband pay all but one day of their costs of the trial which:-

   a)in the case of the independent children’s lawyer is quantified at $31,143 inclusive of disbursements associated with subpoenae and the like;

   b)in the case of the wife is $30,610.

8. Additionally, the wife seeks an order that the husband pay $300 by way of witness expenses for the attendance of her parents to give evidence for the husband by video link from Northern Queensland.  Those costs have already been the subject of an order made by me on 15 February 2007 in the following terms:-

   1. That the husband be responsible for the witness expenses of Mr &

   
   

   Mrs [H] incurred for the purpose of giving evidence in [North Queensland], such expenses be fixed in the sum of $300 and paid by him within 7 days and forwarded direct to Mr & Mrs [H], […], Queensland […]. 

9. The wife’s parents were called by the husband. The wife is on not responsible for their costs of having attended the venue for video link up in North Queensland.  Even if I accept the wife’s application in this regard as seeking enforcement of my Order made on 15 February 2007, that is not an order which inures for her benefit.  If it is to be enforced, it must be enforced by Mr and Mrs H.  Accordingly, I will dismiss this part of the wife’s costs application. 

10. In the alternative each seeks that the husband pay the costs of a portion of the trial being 5, 6, 9, 14, 15, 16 and 19 February 2007. The independent children’s lawyer quantifies those costs at $13,822 inclusive of the costs and disbursements of subpoenae. The wife’s costs are calculated at $12,989 exclusive of any costs claimed for her parents and referred to in the preceding paragraph of these reasons. 

11. Section 117 of the Family Law Act1975 contains the general rule that each party to proceedings under the Act shall bear his or her own costs.  The object of the rule is to ensure that parties are not deterred from bringing or maintaining legitimate applications for fear of incurring an intolerable financial burden if they lose.[1]  However, the Court retains a discretion to make an order for costs if it is of the opinion there are circumstances that justify that course and it would be just to do so. 

    [1]  In the Marriage of Kohn (1977) 30 FLR 175 at 177.

12. In considering whether to make an order the Court must have regard to the matters set out in s 117(2A). The weight to be attached to any of the considerations in sub-s (2A) is wholly discretionary. However, while no single factor out-ranks any other, there is nothing to prevent one or other of them from being the sole foundation for a costs order.[2]  As Kay J observed in Brown & Brown[3] :

    "In many cases there will be an outstanding feature . . . that makes an order for costs appropriate, a feature which so dominates the scene that it can outweigh any of the other s 117(2A) considerations".

    [2]  LAC and TRF and LKL [2005] Fam CA 158 at [41].

    [3] (1998) FLC 92-822 at 85,347.

13. The applicants for costs contend that this application raises the matters in paragraphs 117(2A)(a) and (c).  They are:-

    (a)  the financial circumstances of each of the parties to the proceedings;

    (c)  the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters.

14. It also seems to me that the ss 117(2A)(e) is relevant. It provides:-

    (e)  whether any party to the proceedings has been wholly unsuccessful in the proceedings;

15. As was commented by Brown FM, in the matter of Pension & Pension (No. 2) (2005) FMCAfam 22:

    The husband was entitled to seek an adjudication of the competing applications from the court.  However, the efficient administration of justice, particularly in family law matters, relies on the parties concerned and their legal representatives making a bona fide attempt to resolve the matters in dispute between them.  This is particularly so where the costs of the litigation involved grow to a point where they are out of proportion to the magnitude of the issues involved. 

16. The learned Federal Magistrate goes on to observe:-

    The outcome of any litigation which hinges on the exercise of discretion cannot be predicted with complete certainty.  That is a truism.  However, in assessing the degree of uncertainty and outcome the parties cannot allow themselves to lose sight of the magnitude of the issues at stake when set against the possible costs involved.

17. The above sentiments apply to all courts in the family law system.  In this case, the issue at stake was residence of the child and what time the parent who is not the primary carer ought to spend with the child. I accept the submissions of the independent children’s lawyer and the wife to the effect that the husband’s case did not address matters relevant to the child’s welfare and that the husband did not “attempt to pursue his response or challenge the wife’s application.”[4]

    [4] Written submission of the independent children’s lawyer filed 3 October 2007, paragraph 12 and wife’s written submissions filed 4 October 2007, paragraph 1.

18. The difficulty with this case is that the husband’s misbehaviour in court consumed an enormous amount of court time.  To the extent that the husband attempted to present a case, he did so sloppily by reference to irrelevant and poorly drawn affidavit material and his submissions were discursive.  Ultimately, evidence which the husband insisted was relevant, such as evidence from the supervisor of the N Contact Centre and the Australian Federal Police, was obtained in spite of him rather than through his case.  

19. The applicants for costs make the point that the husband could have walked away from the proceedings on, or prior to, the first day of the hearing.  At that stage, of all the parties to the proceedings it was only the husband who knew that he had no evidence to support his case.  I accept the submissions of the applicants for costs.  I accept that the reasonable estimate of the time required for the husband’s case, such as it was, was no more than one day.  The balance of court time was spent dealing with the husband’s disruptive behaviour and sifting through evidence in order to assess if there would, all considerations being taken into account, be some discernable benefit to the child of having the husband involved in his day to day life to the extent that the husband sought or at all. 

20. In a case which has implications as serious as the implications were here for the child now and into the future, it was not open to the court, in my view, to disregard the husband’s presence and treat the application of the wife (even as supported by the independent children’s lawyer), as unopposed.  Part VII of the Act imposes a duty on the court to be satisfied that the child’s best interests are met.  It is an assessment process having regard to the primary and secondary consideration prescribed in the legislation. Notwithstanding that the proceedings are conducted adversarily, proceedings cannot be determined automatically and merely on the basis of default by one party.  As previously indicated, I could not assume that, because the husband was a poorly behaved litigant that he should not have an ongoing role in his son’s life. 

21. The manner in which the husband conducted these proceedings weighs significantly in favour of making an award of costs against him and in favour of the parties which were put to unnecessary expense. 

22. I take into account the financial circumstances of the husband and the wife.  Neither have any significant capital or income.  The husband’s evidence was that his mother sent him funds with which to conduct the parenting proceedings but that was in the vicinity of $60,000 and by no means such a sum as could lead me to conclude that the husband’s capital position is so much better than that of the wife that it alone justifies an order for the husband to pay the wife’s costs or part thereof. 

23. The husband has a much better income position than the wife.  He is in the employ of Mr T’s company and others.  He shares some expenses with Mr T and Mr T’s evidence was that he occasionally meets rental expenses of the husband when he believes that the husband cannot afford to do so himself.  The wife is in receipt of income tested benefits paid by the government.  She is responsible for the financial support of the child.  She has no one with whom to share her expenses.  There is a disparity in the income positions of the husband and the wife but the husband’s superior position is not so superior that it alone could constitute a justification for costs relief in favour of the wife.  

24. The other disparity between the husband and the wife is that the wife has incurred legal expenses and the husband has not because he represents himself.  The wife’s expenses will be defrayed in the short term by Victoria Legal Aid but I expect that she will be required to pay them or some part of them if she is ever assessed at being in a position to do so.  I cannot assume that the costs will never impact upon her. 

25. I am satisfied that the husband’s relatively modest income and capital position are not contraindicative of an order for costs being made against him. 

26. The independent children’s lawyer is also funded by Victoria Legal Aid.  

    
    

    I accept that funding which was made available in this case has reduced the capacity of Victoria Legal Aid to fund other persons who may have been eligible for assistance.  Victoria Legal Aid is not a bottomless coffer by any means.  It is a valuable resource in our community and should be protected to the extent that it is proper to do so. In this case, I am satisfied that the independent lawyer has been put to significant expense to represent the interests of the child and that the expense was overwhelmingly incurred by reason of the husband’s unsatisfactory conduct, disorganisation in presentation of his case and his unsuccessful interlocutory applications including, but not limited to, the attempts of the husband to have the independent children’s lawyer replaced. 

27. I also take into account, pursuant to ss 117(2A)(e) that the husband was wholly unsuccessful in the proceedings. Not only in the result but the husband consistently made or opposed interlocutory applications in which he was unsuccessful. Those interlocutory applications, in particular, his applications for me to disqualify myself, interrupted the flow and the case and wasted valuable court time for which the wife and the independent children’s lawyer incurred expense.

28. I am satisfied that the husband ought to pay and be responsible for the most of the costs incurred by the wife and by the independent children’s lawyer to be represented after the first day of the trial and for their proper disbursements incurred.  In the wife’s case, proper disbursements do not include the $300 still owing the wife’s parents. 

29. Taking the relevant factors into account, of which the husband’s conduct is by far the most significant factor but also bearing in mind that he has been unsuccessful in interlocutory matters as well as in the final result, I conclude that the husband should pay 70% of the costs of each other party disregarding the expense of representation on the first day of the trial. 

30. As I have determined that the claimants for costs ought get their costs calculated above, I do not need to consider their alternative claim for partial costs. 

31. The costs should be calculated on a party-party basis and should pertain to the trial not the whole of the whole of the proceedings.  The independent children’s lawyer claims costs and disbursements in the sum of $31,143 of which counsels’ fees are claimed at $1,235 per day and a solicitor attending at $930 per day for 14 days.  That is a figure below the amount provided in the scale of costs under the Family Law Rules 2004. It is also remarkable value considering the calibre of the representation provided by Mr Hoult and Mr Lampe. I make the same observation as to the rates claimed by the wife and her representation. 

32. The professional fees and expenses of each claimant for costs will be allowed as to 70%. In the case of the independent children’s lawyer the costs and disbursements are $31,143 of which 70% is $21,800.  In the case of the wife, the allowable costs and disbursements are $30,310 of which 70% is $21,217. 

33. I have considered whether the matter ought now to proceed to assessment rather than fix the costs.  Whilst this is a final hearing the costs claimed are very straightforward.  An assessment of costs which is a whole new procedure in itself and is not justifiable having regard to the principle of proportionality.  An assessment of costs would take place under the Family Law Rules 2004.  The main purpose of the Rules of this court is set out in r.1.04 as being “to ensure that each case is resolved in a just and timely manner at a cost to the parties and the court that is reasonable in the circumstances of the case.”

34. I consider it more appropriate to fix an amount of costs. 

35. As indicated, the submissions filed by the husband seem to be directed to matters of enforcement and, if I understand some of the submission correctly, to foreshadow that the monies held pursuant to paragraph 3 of my orders made on 20 February 2007 may not be available to satisfy the husband’s liability pursuant to this decision, or even part of the liability on the basis that the funds are the property of an unnamed “family friend”.  The submissions do not sit comfortably with the evidence which the husband gave at trial and which

    
    

    I have summarised at paragraph 7 of my reasons for judgment delivered on

    
    

    20 February 2007[5] which appears in the following extract:-

    [5] Adams  & Adams (No.7) [2007] FamCA 293

    1.In this matter Mr Hoult, counsel for the independent children's lawyer, has this morning made an application for leave to make an oral application to enjoin $20,000 of moneys which are invested in the name of the husband with Commonwealth Bank of Australia.  He says that he does in a way similar to seeking security for costs.  Mr Hoult submits that he is instructed to make an application for costs at the conclusion of this hearing and, in anticipation of his client being successful with that application, his client seeks the amount of $20,000 to be preserved so that it may be applied in satisfaction of the costs order. 

    2.It is perfectly clear that the independent children’s lawyer is not asking me to make a costs order now and nor is he asking me to say how any costs order may be enforced in the future. The independent children’s lawyer merely wants to keep his client's options open. 

    3.Mr Combes for the wife makes an application in precisely the same terms and for the purpose of this particular application and these reasons for judgment the submissions made on behalf of the independent children's lawyer are adopted and repeated on behalf of the wife. 

    4.Turning to the subject matter of the application, the money. 

    5.The husband in oral evidence before me confirmed that there was an amount of $65,000 invested with Commonwealth Bank of Australia Ltd. He was unable to give the account number.  However, a perusal of court documents, which includes his further amended application in a case filed in this court on 27 October 2006 refers to the invested funds as follows:

    INVESTMENT TRUST ACCOUNT ‑ ‑ ‑

    [The child]'s paternal grandmother has donated $65,000 in [the child]'s bank account.  That $65,000 is for [the child]'s future, held in his Commonwealth Bank account and entrusted to me, [the child]'s father here in [W] - Melbourne, Victoria.  This financial assurance is for [the child]'s wellbeing and is accessible whenever needed.  Evidence is marked "P2". 

    6.I note that there is an annexure which on the bottom right hand corner is marked "P2", it is a new account notification for account identification number […]1, opened by [Mr Adams] of […] Road, [W].  The account title is [the child’s name].  The customer details are [the child’s name]. 

    7.Mr [Adams] in his evidence said that the moneys were sent to him by his parents for the purpose of funding his - that is, Mr [Adam]'s - legal expenses in Australia.  Once he received the money he took the view that it was no use paying the kind of lawyers who were available in Australia to assist him in his case and he decided to give it to [the child]. 

    8.I am not determining now who owns the funds or the person for whose benefit the funds are held. 

1. Save to the extent that the frozen funds can, by agreement between all relevant persons, now be applied in satisfaction of this costs determination, it is appropriate that the funds continue to be held pending the completion of any dispute as to ownership and subject to further order of the court.  I will order accordingly.  

I certify that the preceding thirty six (36) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Bennett

Associate 

Date:  13 December 2007