Baldwin and Baldwin (Costs)
[2011] FamCAFC 10
•2 February 2011
FAMILY COURT OF AUSTRALIA
| BALDWIN & BALDWIN (COSTS) | [2011] FamCAFC 10 |
| FAMILY LAW - COSTS – Costs of the appeal – No order for costs – Costs certificates awarded to both parties under s 9 and s 6 of the Federal Proceedings (Costs) Act 1981 (Cth). FAMILY LAW - COSTS – Costs of the first instance property proceedings – where the trial Judge had refused the wife’s application for costs and ordered that there be no order as to costs – where the wife filed but did not prosecute an appeal against the trial Judge’s refusal to order costs – where the husband applied to appeal out of time the trial Judge’s refusal to order costs – where the Court dismissed the husband’s application. |
| Family Law Act 1975 (Cth) Family Law Rules 2004 Federal Proceedings (Costs) Act 1981 (Cth) |
| Gallo v Dawson (1990) 93 ALR 479 |
| APPELLANT: | Mr Baldwin |
| RESPONDENT: | Ms Baldwin |
| FILE NUMBER: | BRC | 6089 | of | 2007 |
| APPEAL NUMBER: | NA | 16 | of | 2009 |
| DATE DELIVERED: | 2 February 2011 |
| PLACE DELIVERED: | Sydney |
| JUDGMENT OF: | Finn, Boland and Thackray JJ |
| HEARING DATE: | By way of written submissions |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 26 February 2009 |
| LOWER COURT MNC: | [2009] FamCA 207 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Mr Kirk SC |
| SOLICITOR FOR THE APPELLANT: | Charles Cooper Lawyers |
| COUNSEL FOR THE RESPONDENT: | Mr North SC and Ms Brasch |
| SOLICITOR FOR THE RESPONDENT: | Hopgood Ganim Lawyers |
Orders
That the cross-appeal by the wife filed 30 March 2009 against the order made by the Honourable Justice Bell on 26 February 2009 that there be no order for costs in relation to the first instance proceedings, be dismissed for want of prosecution.
That the husband’s application (as contained in submissions filed on 14 December 2010) for costs of the Appeal No NA 16 of 2009, being the appeal against the orders for property settlement made by the Honourable Justice Bell on 26 February 2009 (the property settlement appeal) be dismissed.
That each party pay his or her own costs of and incidental to the property settlement appeal.
That the Court grants to the appellant husband a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant husband in respect of the costs incurred by him in relation to the property settlement appeal.
That the Court grants to the respondent wife a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent wife in respect of the costs incurred by her in relation to the property settlement appeal.
That the husband’s application for the costs of the substantive proceedings BRC 6089 of 2007 (as contained in submissions filed by the husband on 14 December 2010) be dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Baldwin & Baldwin (Costs) is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT BRISBANE |
Appeal Number: NA 16 of 2009
File Number: BRC 6089 of 2007
| Mr Baldwin |
Appellant
And
| Ms Baldwin |
Respondent
REASONS FOR JUDGMENT
On 11 November 2010 this Full Court made orders (and delivered reasons for those orders) allowing an appeal by the husband against orders for property settlement made by Bell J on 26 February 2009, and substituting our own order to provide for the payment of monies to the husband and to the wife in place of an order made by his Honour for the payment of monies to the wife.
We were informed at the hearing of that appeal that the wife had filed an appeal against Bell J’s order (also made on 26 February 2009) that there be no order as to costs in relation to the costs of the property settlement proceedings before his Honour. We then agreed with counsel for both parties that it would be appropriate, when we delivered our judgment in relation to the property settlement appeal, for us to make directions for the filing of written submissions in relation to the wife’s appeal against the order that there be no order for costs, and also in relation to the costs of the husband’s appeal against the property settlement orders.
Accordingly, our orders made on 11 November 2010 included the following directions:
…
(3) The wife file and serve any written submissions in relation to the appeal against the order made by the Honourable Justice Bell on 26 February 2009, which provided that there be no order for costs in relation to the proceedings for property settlement, and in relation to the costs of the appeal against the orders with respect to property settlement, within 21 days of the date hereof.
(4) The husband have a further 21 days in which to file and serve any written submissions in response thereto.
(5) The wife have a further 14 days in which to file and serve any written submissions in reply thereto.
…
We have now become aware from the submissions filed by the parties pursuant to these directions and from advice from the Appeal Registrar that the wife’s appeal against his Honour’s order that there be no order for costs was in fact contained in a notice of cross-appeal (filed 30 March 2009). We will return to this matter in due course.
Following our orders and directions made on 11 November 2010 the wife, through her solicitors, filed submissions headed “Wife’s submissions in relation to the question of costs” on 29 November 2010.
In those submissions the wife states that she “does not press the cross-appeal in relation to the order made by the trial Judge on 26 February 2009 that there be no order for costs”. In relation to the costs of the property settlement appeal, the wife seeks in her submissions the following orders:
(a)That a costs certificate be granted to the wife pursuant to section 6 of the Federal Proceedings (Costs) Act 1981 (Cth) in respect of the appeal, it having succeeded by reason of an error of law.
(b)That there be no order as to the costs of the appeal (or cross-appeal).
Submissions then follow in support of the wife’s contention that there should be no order in relation to the costs of the appeal, with reliance being placed on the general rule in s 117(1) of the Family Law Act 1975 (Cth) (“the Act”) that in proceedings under the Act (and subject to certain other provisions in the Act, including s 117(2A)) each party should bear his or her own costs of such proceedings, and with reliance also being placed on the various matters contained in s 117(2A) which, it was submitted, would not justify an order for costs against the wife.
Submissions are also made in support of the wife’s application for a costs certificate.
On 14 December 2010 the following three sets of submissions were filed on behalf of the husband:
·“Submissions in respect of costs of appeal NA 16 of 2009 filed on behalf of the appellant/husband”: in these submissions the husband seeks that the wife pay his costs of the property settlement appeal.
·“Response to the wife’s submissions in relation to the costs delivered by the husband (sic)”: in these submissions the husband states that he does not oppose the wife being granted a costs certificate under s 6 of the Federal Proceedings (Costs) Act, but he also states that he seeks an order that the wife pay his costs of the property settlement appeal, and he makes submissions in response to the wife’s submissions in support of her position that there should be no order for costs in relation to that appeal; the husband further states that in the event that the Court determines that there should be no order for costs in relation to the property settlement appeal, he seeks a costs certificate under s 9 of the Federal Proceedings (Costs) Act.
·“Submissions in respect of costs of the proceedings No BRC 6089 of 2007 filed on behalf of the appellant/husband”: in these submissions the husband seeks that this Court should now order that the wife pay his costs of the property settlement proceedings before Bell J.
There was also filed on behalf of the husband on 14 December 2010 an affidavit sworn by his solicitor in support, it would appear, of the husband’s application for the costs of the first instance proceedings (sought in the last mentioned set of submissions from the husband).
On 24 December 2010, the wife filed a further set of submissions headed: “Wife’s Submissions in reply in relation to the question of costs”, in which she responds to all three sets of submissions filed by the husband. She also objects to the filing of the affidavit from the husband’s solicitors.
We will consider first the issue of the costs of the property settlement appeal, before turning to the issue of the costs of the proceedings at first instance (as sought in the third mentioned set of submissions from the husband).
Costs of the property settlement appeal
It is unnecessary that we explain in any detail the lengthy submissions of both parties directed to the costs of the property settlement appeal as each party’s submissions are available to the other. Nor do we need to set out or explain the provisions of s 117(1), (2) and (2A) which are relied on by both parties and referred to at length in their submissions. It is only necessary to explain that in his submissions for an order in his favour for the costs of the property settlement appeal, the husband can be seen as placing particular reliance on his success and the wife’s lack of success in that appeal, and also on his contention that the wife “through her legal representatives led the Trial Judge into error in delivering his judgment”. (See paragraph 3.3 and also paragraph 3.2 of the second mentioned set of the husband’s submissions and paragraph 28 of the first mentioned submissions.)
In relation to the husband’s contention that it was the wife’s representatives who led his Honour into error, we do not accept that contention. As we indicated in paragraphs 21 to 24 of our reasons of 11 November 2010, it appears that his Honour did in fact adopt, and impliedly incorporate by reference in his reasons, a schedule of assets and liabilities prepared by Senior Counsel for the wife. As also emerges from subsequent passages of our reasons, his Honour accepted for purposes of his decision certain controversial figures in that schedule with little or no explanation. The fact that his Honour may have fallen into error by adopting an erroneous figure and/or by failing to explain why he had adopted a particular figure are not matters for which the wife should now bear responsibility by way of a costs order.
As to the husband’s reliance on his success and the wife’s lack of success in the property settlement appeal, it is true that we found substance in many, if not most, of his grounds of appeal, and that in our re-determination of the property settlement matter, we increased his share of the value of the parties’ assets from the 50 per cent (as awarded by the trial Judge) to 55 per cent.
However, as pointed out by the wife in her submissions, many of the husband’s grounds of appeal succeeded because of an inadequacy of reasons on the part of the trial Judge (see paragraphs 18, 44 and 91 of our reasons for judgment of 11 November 2010). Again the wife should not have to bear responsibility by way of a costs order for errors of that nature.
It also has to be remembered that there were a number of shortcomings in the conduct and preparation of the husband’s case as identified by us in paragraphs 19, 45, 69, 83 and 86 of our reasons for judgment of 11 November 2010. Indeed, these considerations influenced our decision to re-determine the matter ourselves rather than order a new trial.
We note that the husband now contends in his submissions in support of his application for his costs of the appeal, that he did make full disclosure so far as he was able at trial, and that to the extent that there may have been shortcomings in the information before the Court concerning various entities of his family of origin (which he does not apparently accept to have been the case), this was not his responsibility as those entities were controlled by his mother and/or brother.
There can, however, be little doubt, in our view, that the expert, Mr H, did not consider that he had all necessary information to enable him to value the husband’s interests in the entities in question. (See paragraphs 36 to 40 of our reasons of 11 November 2010, and in particular the extracts from Mr H’s report set out at paragraph 37.) Even if it is accepted that the provision of such information was a matter over which, at least technically, the husband had no control, the limited financial information available to the expert and thus to the Court, was a matter which caused difficulties for the original determination, and then the re-determination, of the case. This lack of information could have been remedied by the husband’s family; it is certainly not a matter for which the wife should bear responsibility.
It might, of course, be said that the matters just discussed have limited relevance to the issue of the costs of the appeal. But, in our view, they are matters which did influence the need for the appeal, and then its outcome.
Notwithstanding the husband’s success in the appeal, we are not therefore persuaded, having regard to the matters we have canvassed and to any of the other matters in s 117(2A) that there are circumstances justifying a costs order in favour of the husband. Rather the general rule that each party pays their own costs should apply, and in our view, having regard to our reasons for judgment of 11 November 2010 overall, it is particularly appropriate that the general rule apply in this case.
We are, however, prepared to grant costs certificates to the parties under s 9 and s 6 of the Federal Proceedings (Costs) Act. We are satisfied that the conditions for a grant of such a certificate exist.
Costs of the property settlement proceedings at first instance
The basis on which the husband now seeks that this Court should order that the wife pay his costs of the property settlement trial (and that she do so on an indemnity basis), notwithstanding that the trial Judge had determined that there should be no order for the costs of the trial, is set out at paragraphs 2 to 7 of the third mentioned set of the husband’s submissions. Those paragraphs are as follows:
2. Following judgment on 26 February 2009 the Appellant filed a Notice of Appeal on 9 March 2009 in relation to the substantive proceedings in light of the order made by the Trial Judge on 26 February 2009 under which he awarded the Respondent $1,331,981.00 and the Trial Judge ordered there would be no order as to costs in response to a request from counsel for the Respondent to the appeal. The Appellant did not lodge an appeal in respect of the costs order because the Appellant was not in a position to apply for costs from the Trial Judge in light of his Honour’s order.
3. The Respondent filed her Notice of Cross Appeal on 30 March 2009 and in that Notice of Cross Appeal she appealed against order 4 made by Justice Bell on 26 February 2009 ie., the costs order.
4.The issues covered in the Appellant’s Notice of Appeal and Amended Notice of Appeal and the Respondent’s Notice of Cross Appeal were therefore live before the Full Court.
5.At the hearing of the Appeal no submissions were taken in respect of costs pending the outcome of the appeal decision.
6.The appeal decision was handed down on 11 November 2010 and orders were made for the filing of submissions in respect of costs of:
(a)the trial; and
(b)the appeal,
within 21 days by the Respondent, with the Appellant having 21 days thereafter to answer and the Respondent having 14 days to reply to the Appellant’s submissions.
7. The costs issue in respect of both parties was therefore live before the Full Court and the Appellant seeks his costs of the proceedings. If leave is needed by the Appellant to amend his Notice of Appeal to include an appeal regarding the costs orders, then leave is sought to amend the Notice of Appeal accordingly to appeal the decision in respect of costs in the unusual circumstances of the case.
It may assist an understanding of what is said by the husband in these paragraphs if we explain that Bell J heard the property proceedings over three days, being 23, 24 and 25 February 2009, and that on the afternoon of 26 February 2009 he delivered an oral judgment. It appears that following the delivery of his oral judgment, his Honour received submissions, presumably on behalf of both parties in relation to the costs of the trial, and he determined that there should be no order for costs. The portion of the transcript of 26 February 2009 which contained the submissions in relation to costs was deleted from the Appeal Books provided to us for purposes of the property appeal, and we have not been provided with, and do not otherwise have access to, those submissions.
However, at the conclusion of his Honour’s property judgment, as it appears in the Appeal Book for the property appeal, the following paragraph appears:
46. This is a matter wherein the general provisions of the Act apply that notwithstanding the provisions of s 117 and that is, each party should bear their own costs. Both parties have sufficient funds with which to bear those costs. Application for costs dismissed, Ms Brasch.
Ms Brasch was Counsel for the wife, and thus it was the wife’s application for costs which his Honour dismissed.
His Honour’s orders as they appear both at that beginning of his settled judgment and also in engrossed form, contain as a fourth order, an order which provides “[t]hat there be no order as to costs”. The preceding three orders concern property matters.
Neither the husband’s original notice of appeal (filed 9 March 2009) nor his amended notice of appeal (relied on at the hearing of the property appeal) challenged his Honour’s refusal to make a costs order in relation to the property proceedings heard by him.
However, the wife filed a cross-appeal on 30 March 2009 against his Honour’s order that there be no order for costs. The grounds contained in that notice of cross-appeal were essentially directed to his Honour’s consideration of the matters in s 117(2A) and to the adequacy of his reasons.
Rule 22.07 of the Family Law Rules 2004 provides in relation to cross-appeals:
A respondent to an appeal or an independent children’s lawyer who intends to argue that an order under appeal should be varied or set aside must cross-appeal by filing a Notice of Appeal endorsed as a cross-appeal.
Given that the wife was not appealing any of the property settlement orders, we can only assume that the reason why a notice of cross-appeal rather than a notice of appeal was used to appeal the order relating to costs was because his Honour’s orders relating to property and to costs were made on the same day and recorded in the same engrossment.
But whatever the reason for the wife’s use of a notice of cross-appeal (rather than a notice of appeal), she has now informed us in her written submissions that she does not wish to pursue her cross-appeal (or appeal) against his Honour’s refusal to make a costs order.
Strictly speaking the wife should have filed a notice of discontinuance of her cross-appeal. But in the interests of finalising this matter in the Court’s record system and also of saving further costs, we will make an order dismissing the wife’s cross-appeal for want of prosecution.
Given that the wife’s cross-appeal is not now pressed and that the husband raised no challenge to the trial Judge’s refusal to make an order for costs in either his notice of appeal or amended notice of appeal, we cannot see how it can be asserted that the issue of costs remains “live” before this Court. It may have been “live” so long as the wife’s cross-appeal was on foot. But once she advised the Court and the other side in her submissions filed on 29 November 2010 that she did not press the cross-appeal, the issue of costs was no longer “live” before this Court.
But even had the wife’s cross-appeal against the order relating to costs been pressed (or could be said to remain “live” until we dismiss it for want of prosecution), it would not have been possible for the husband to take any position in relation to the wife’s appeal other than to support the trial Judge’s order, at least in the absence of a cross-appeal by the husband against that order.
To the extent that it appears from paragraph 6 of the husband’s submissions, that the terms of our directions for the filing of written submissions contained in our orders of 11 November 2010, could be relied upon to support the contention that the issue of costs remained “live” before us, such an argument would seem to proceed on the basis of a misinterpretation of those directions. It will be seen from those directions that we invited submissions in relation to “the appeal against the order made by the Honourable Justice Bell on 26 February 2009 which provided that there be no order for costs in relation to the proceedings for property settlement”. Thus, it was the appeal against the order with respect to the costs of the trial, not the costs of the trial, to which submissions were to be directed.
It appears from paragraph 7 of the husband’s submissions that in the event that we are not prepared to accept that the issue of the costs of the trial remains a “live” issue before us, that the husband would seek leave to amend his notice of appeal against the property orders to include an appeal against the trial Judge’s refusal to make a costs order. Perhaps put more accurately, given that the appeal against the property order has already been disposed of, the husband would need an extension of time to file an appeal against the trial Judge’s refusal to make a costs order.
However, there is nothing in the husband’s submissions which expressly explains the reasons why an extension of time to appeal the costs order should be granted, nor is there any explanation of the grounds on which such an appeal would be pursued.
The only explanation for this late application might impliedly be found in the statement in paragraph 2 of the husband’s submissions set out above, being that an appeal was not lodged in respect of the costs order because the husband was not in a position to apply for costs from the trial Judge “in light of his Honour’s order” (presumably his property settlement order or orders). It might also be assumed that the husband also relies on the “unusual circumstances of the case” referred to in paragraph 7 of his submissions. But what those “unusual circumstances are” is not explained.
However, we find it difficult to understand that the husband could now attempt to provide an explanation for his delay in appealing the trial Judge’s refusal to make an order for costs, given the following exchange between Senior Counsel for the husband and ourselves at the conclusion of the property appeal (emphasis added):
MR KIRK: Your Honours would be conscious that there is a costs appeal, raised by my friends but - - -
FINN J: I don’t know that we were.
BOLAND J: I think the only thing that gave me a clue was I saw a transcript page was cut in half and I thought there must be some reference to costs.
MR KIRK: And that would necessarily involve, I imagine, your Honours in the event that we get your judgment on the substantive matter - - -
FINN J: It does mean we have got to have further submissions.
MR KIRK: We would have to have those further submissions. I just thought I would raise it because there is probably a need for some form of direction from your Honours in relation to that. I am happy to deal with that by way - it’s not our appeal, it is my friend’s.
FINN J: I was going to ask you, whose appeal is it. Yes.
MR KIRK: Separate and distinct appeal but one would have thought that your Honours are in the best possible position to deal with it and we could deal with it by written submissions.
It will be seen that there was no suggestion made on behalf of the husband that he might seek to re-open by way of an appeal the issue of the costs of the trial in light of any re-determination by us of the property matter. This was so notwithstanding that the possibility of our re-determining the property matter had been earlier canvassed at the hearing of the appeal
We do note, however, out of fairness to the husband, that in the orders sought in both his original and amended notices of appeal, he sought that if we were to make new property orders in a re-exercise of the discretion, that we make an order “that the wife pay the husband’s costs of and incidental to this application”.
It is not clear to us what “application” was there being referred to. But assuming that it is the application for a re-determination of the matter by the Full Court, we observe that it has not been the practice of the Full Court when it has found substance in the grounds of an appeal and has then re-determined the matter which was before the trial Judge, to make an order with respect to the costs of the substance of the appeal (in the sense of the grounds of the appeal), and a separate order with respect to the costs of the re-determined matter.
Rather the practice has been to make one order in respect of the successful appeal (including any re-determination of the matter originally determined by the trial Judge). We have only concerned ourselves with the costs of the determination of the matter which was originally before the trial Judge (whether or not we re-determined that matter) if there has been an appeal against that Judge’s order with respect to the costs of the trial, and this is usually done in the context of a separate and subsequent order and reasons for judgment published by us, subsequent to our determination of the main appeal.
Having regard to the matters which we have discussed, we are not persuaded that it would be in the interest of justice overall for us to permit the husband to appeal out of time (whether by amendment of his original appeal or by a new appeal) the refusal by the trial Judge to make a costs order in respect of the trial (Gallo v Dawson (1990) 93 ALR 479).
In reaching this conclusion and in the absence of any foreshadowed grounds of appeal, we have had regard to the matters contained in the balance of the husband’s submissions directed to the present application (particularly at paragraphs 20 to 30). No matter relied on in those paragraphs persuades us that an order for costs would be justified in respect of the property settlement proceedings before Bell J, nor in respect of our re-determination of those proceedings. It appears to us that in seeking his costs of the trial (or the re-determination of the matter), the husband places particular emphasis on offers of settlement made to the wife and not accepted by her. But we do not consider that such offers would justify an order for costs against the wife given the qualifications which surrounded the expert’s evidence as to the value of the husband’s interests.
We propose therefore to order that the husband’s application for the costs of the substantive proceedings BRC 6089 of 2007 (as contained in submissions by the husband filed on 14 December 2010) be dismissed.
I certify that the preceding forty seven (47) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Finn, Boland and Thackray JJ) delivered on 2 February 2011.
Associate:
Date: 2 February 2011
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