Banks & Anor and Sullivan
[2013] FamCA 716
•13 September 2013
FAMILY COURT OF AUSTRALIA
| BANKS AND ANOR & SULLIVAN | [2013] FamCA 716 |
| FAMILY LAW –COSTS ––– Injunction proceedings |
| Family Law Act 1975 (Cth) ss 117 |
| Bodilly & Hand (No. 2) [2012] FamCA 734 |
| APPLICANT: | Ms Banks |
| APPLICANT: | Mr Tyler |
| RESPONDENT: | Ms Sullivan |
| FILE NUMBER: | SYC | 889 | of | 2008 |
| DATE DELIVERED: | 13 September 2013 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Justice Loughnan |
| HEARING DATE: | 12 August 2013 |
REPRESENTATION
| MS BANKS: | In Person by phone |
| SOLICITOR FOR MR TYLER: | Mr Holmes |
| MS SULLIVAN: | In Person |
Orders
That within six months Ms Sullivan pay to Ms Banks or as she may direct, the costs of Ms Banks of and incidental to the proceedings concluded by judgment delivered on 12 April 2013, assessed in the sum of $14,000.
That Ms Sullivan pay to the solicitor for Mr Tyler, the costs of Mr Tyler of and incidental to the proceedings concluded by judgment delivered on 12 April 2013, as agreed or assessed.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Banks and Anor & Sullivan has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 889 of 2008
| Ms Banks |
Applicant
And
| Mr Tyler |
Applicant
And
| Ms Sullivan |
Respondent
REASONS FOR JUDGMENT
Introduction
Mr Tyler (father) and Ms Sullivan (mother) are parents involved in longstanding and ongoing proceedings about their son, D. Before the Court are the applications by a third party, Ms Banks and the father for costs arising out of interlocutory proceedings for injunctions and other orders determined by me on 12 April 2013.
Also before me on the hearing of the costs applications were Ms Banks’ Application in a Case filed 1 July 2013 for injunctions and an application by the mother for summary dismissal of that application. Ms Banks applied for an adjournment of her application. For reasons given on the day the Application in a Case filed by Ms Banks on 1 July 2013 was dismissed and it was therefore not necessary to address the adjournment application.
Applications
Ms Banks and the father seek orders against the mother for their costs arising out of the proceedings determined on 12 April 2013. The mother opposes those applications.
Ms Banks seeks an order for costs in the sum of $17,311.
The father seeks an order for costs in the sum of $10,125 or such other amount as the Court may assess.
The issues include the liability for costs and if there are to be costs orders the basis for calculating costs and the mechanism for quantifying them.
Written Evidence
Ms Banks relied on the following documents:
Application in a Case filed 29 April 2013;
Affidavit of Ms B Banks filed 29 April 2013
The father relied on the following documents:
Affidavit of Mr DH filed 8 May 2013.
The mother relied on the following documents:
Response filed 1 August 2013;
Mother’s affidavit filed 1 August 2013; and
Written submissions.
The Hearing
The matter was listed for hearing on 12 August 2013. Ms Banks and the mother appeared without legal representation. The father was represented by his solicitor. There was no oral evidence. Documents were tendered and at the conclusion of submissions, judgment was reserved.
Background Facts
It is not necessary to recite the full chronology of the parenting proceedings between the father and mother. The following facts should be sufficient for the purposes of understanding the background to the interlocutory proceedings before me.
·Parenting proceedings commenced between Mr Tyler and Ms Sullivan about their son D on 18 February 2008.
·On 24 April 2008 the mother left Australia and without the consent of the father or the permission of a court, took the child with her.
·The father commenced a search for the child.
·On 7 May 2008 orders were made without further notice to the mother, that the child live with the father pending further order.
·In September 2010, two years and four months after he was removed from Australia, the child was located in the Europe. On 6 September 2010 the mother was arrested in the Europe and held in custody there.
·Proceedings were conducted in the Europe under the Hague Convention on the Civil Aspects of International Child Abduction and on or about 30 November 2011 an order was made for the child’s return to Australia.
·In January 2011 the father returned to Australia with the child.
·There were extradition proceedings in the Europe and in February 2011 the mother was returned to Australia. Again the mother was placed in custody. Proceedings were subsequently instituted against the mother in the NSW District Court for a breach of a provision of the Family Law Act 1975 (Cth) (“the Act”), said to arise from her removal of the child from Australia in 2008. Those criminal proceedings have yet to be heard.
·On 28 July 2012, a book by Ms Banks titled “Have You Seen My Child - The Quest to Recover a Stolen Child” was published in electronic form.
·The mother commenced proceedings in this Court for injunctions in relation to publication and in aid of s 121 of the Act on 24 September 2012 and on 12 April 2013 her application was dismissed. The proceedings before me relate to the costs incurred by Ms Banks and by the father in relation to those proceedings.
The relevant legislative provisions
A costs application is determined by reference to s 117 of the Act.
Section 117 of the Act relevantly provides as follows:
117 Costs
(1) Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AB, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.
(2) If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.
(2A) In considering what order (if any) should be made under subsection (2), the court shall have regard to:(a) the financial circumstances of each of the parties to the proceedings;
(b) whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
(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;
(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;
(e) whether any party to the proceedings has been wholly unsuccessful in the proceedings;
(f) whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and(g) such other matters as the court considers relevant.
Thus the general position is that parties bear their own costs but if the circumstances (s 117(2A)) justify it, the Court may make such order as it considers just.
Discussion
I turn to the matters referred to in s 117 (2A):
As to the financial circumstances of the parties:
The mother says that she receives a Centrelink benefit. Her fortnightly payment is $618.40 made up of Newstart Allowance of $497.00, $8.40 as a Clean Energy Supplement, Rental Assistance of $123.00 and $10 is deducted each fortnight for a fine, she says, related to traffic offences. The mother asserts that she owes her mother $390,500 for legal fees. The mother had $8,500 in assets in June 2011 but says that her motor vehicle which was included at $6,000 in that calculation, now has a value of $2,500. She owes $2,500 for furniture. The mother asserts that her weekly expenses exceed her income, in part due to the costs of preparing for legal proceedings – photocopying, printing, posting and administrative costs.
I was told that the mother has a grant of legal aid in the parenting proceedings. It is my understanding that she would have been assessed against a means test in relation to the financial criteria for such a grant.
There is no evidence of the father’s financial circumstances but it was conceded by his solicitor that the father is in better financial circumstances than the mother.
The evidence about Ms Banks’ financial circumstances is that she receives $2,000 a month from her superannuation fund. There is no evidence about her assets or liabilities. There is no evidence about her having any other income or about her outgoings. There is no evidence about the value of her superannuation interests.
There is no evidence that any party had a grant of legal aid for the purposes of the injunction proceedings.
As to the conduct of the parties in the proceedings, Ms Banks and the father complain about the conduct of the mother. The submission on behalf of the father was that three applications were filed by the mother. An original application and two amendments filed 24 September 2012 and 15 November 2012. Whatever might be said about the justification for those amendments, they are likely to have added to the costs of the other parties to the proceedings.
Ms Banks submits that the mother did not contact her before instituting the proceedings that she be restrained. Despite being referred to in her first application, Ms Banks was not named as a party or served. The first amended application named Ms Banks as publisher instead of the company U. Pty Ltd. Ms Banks was served with voluminous material over the course of the proceedings. The mother did not provide a case outline by the required date – 2 December 2012. On the morning of the hearing the mother relied on 26 pages of a case outline that replaced over 1,000 pages of what was then said to be draft documents.
Without dealing with the detail of those submissions, the mother says that she complied with all time limits.
The amended applications warrant particular mention under this provision.
It was submitted by Ms Banks that the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court. The argument runs that had the mother not taken action in 2008 that frustrated certain orders of this Court, the proceedings in question would not have occurred. It is not controversial before me that the mother removed the child the child from Australia in 2008 and thereby frustrated interim parenting orders made by this Court. While I can see the logic of the argument, I do not think that it can be said that the mother’s failure “necessitated” the injunction proceedings. I accept that it is highly unlikely that there would have been the opportunity for those proceedings without the mother’s conduct. However, it is another thing to say that the injunction proceedings brought by the mother were necessitated by that conduct.
In my view, the mother was wholly unsuccessful in the substantive proceedings. Her application was dismissed. She submitted that she was not wholly unsuccessful because included with the formal orders of the Court was a request to change the pseudonym used for the Court’s publication of decisions made in the proceedings. That was not a matter addressed in the mother’s application. This issue was raised orally by the mother at the hearing. The only reference in the reasons for judgment to the issue comes in the second last paragraph which identifies the topic as one that arose during the hearing. In any event the use of pseudonyms is an administrative matter and not one invoking the exercise of judicial power.
The father made a written offer of settlement through his solicitors. On 1 September 2012 the father’s solicitor wrote to the mother in relation to her application about publication issues. Relevantly the letter contained the following
Your application against our client, is misconceived and will fail.
….
Firstly, we remind you of our request that you provide up with a copy of the relevant publication that you contend has occurred.
As we mentioned to you at Court, whatever you give to the Family Court, must also be given to us. You should not interpret our request as any form of authority to you to breach copyright. We simply ask that you to produce the documentary evidence that you apparently intend to rely upon.
Secondly, the issue is, whether, if any such publication has occurred in breach of Section 121, our client has caused that publication. It is respectfully contended that you have no evidence, at all, that our client has caused that publication, whatever that “publication” may be.
You were invited by His Honour to carefully consider your position as regards that cause of action that you have initiated, and you were put on notice by His Honour that if you fail in this Application then the question of costs may be visited against you.
We want you to be under no misunderstanding as to our client’s position in this matter. Firstly, our client denies that he has contravened Section 121 of the Family Law Act.
Secondly, we do not act for [Ms Banks] and have nothing to say about any application that you seek to pursue against her.
Our client invites you to discontinue those injunction proceedings against our client, forthwith.
If you do not, then, once the case is determined, we will be calling for the production of this letter when the question of costs arises.
We turn to what appears to be the second limb of your case and that relates to the issue of the Insight television program that our client participated in.
You were specifically advised at Court, albeit on an informal basis, that Mr Berry, Counsel for the Independent Children’s Lawyer. Viewed that television program and his reaction was that there was no breach of Section 121.
We invite you to view the program again. You can contact SBS if you wish to obtain a copy of the program or view it on Iview. In any event, it appears that you have a transcript of the show. We invite you to concede that there was no breach of Section 121 by our client. Thus, again you should discontinue that case as against our client.
We are providing a copy of this letter to the Independent Children’s Lawyer so that there can be no misunderstanding as to our client’s position in the matter and the fact that we have conveyed this offer to you.
The mother conceded that she did not respond to that letter.
Ms Banks relies on the fact that two letters were sent to the mother. The first of those letters (attached to her affidavit and marked RB1) contains a warning about costs. The second, marked RB 2 does not. Although the letter marked RB1 seems to have been written sometime after the filing of the mother’s first amended application, the letter is dated 19 April 2013, a week after judgment was given in the substantive matter and some months after the hearing. I did not notice this discrepancy during the hearing and it was not brought to my attention. I suspect that the explanation will be to do with an automatic updating feature of computer software. However, the mother did not acknowledge receiving the letter before the hearing and in those circumstances I cannot take it into account against her.
As to other matters that might be relevant, in my view the nature of the proceedings is important. In the general run of proceedings under the Act all (typically two) parties usually seek relief. In parenting proceedings typically both parents seek orders about parental responsibility, living arrangements and ancillary matters. In property proceedings it is usually the case that both parties invoke s 79 for orders to change the property is held because of the breakdown of a marriage or de facto relationship. That was not the situation in relation to the injunction proceedings. The mother alone sought relief and the respondents, including a stranger to the long running parenting proceedings, Ms Banks, had no choice but to respond and thereby to incur costs. Thus the proceedings were more akin to the general run of civil litigation, where often as not, costs follow the event.
All of the parties addressed submissions to the argument that it might be futile to make a costs order against an impecunious person. Both Ms Banks and Mr Holmes on behalf of the father, submitted that an order for costs might deter the mother from making further unsuccessful applications and the Court should not hold back for that reason. In aid of an argument that impecuniosity could not rule out a costs order, Mr Holmes noted that costs orders have been already made in these proceedings against the mother. He cited orders made by the Full Court.
Ms Banks referred to the mother’s assertion that she would not pay any costs and strongly argued that the Court should not be swayed by such a disrespectful statement. Ms Sullivan said that it was not so much that she would not pay but that she could not pay, referring again to her lack of funds. I accept that was her intent. However, the impecuniosity of a party cannot preclude the making of costs orders against that party. At least one costs order has been made against the mother in these proceedings.
I note that, in part, the mother’s submissions addressed the merits of her appeal against the orders of 12 April 2013. As I sought to explain to her during the costs hearing, my consideration of the costs applications arising out of the interlocutory proceedings determined by me, necessarily proceeds on the basis that the substantive orders were correct. In the event that the appeal succeeds then the impact of that decision on a costs determination made at first instance, would be a matter for the Full Court.
Conclusion
Taken together, the facts support each of Ms Banks and the father recovering costs from the mother.
The mother is in worse financial circumstances than the father or Ms Banks. However, she compelled the other parties to incur costs in proceedings that were wholly unsuccessful. The mother amended her application and thereby added to the costs of the other parties. Through his solicitor, the father warned the mother in writing that her action against him was bound to fail and that he would pursue costs against her. The mother did not respond and apparently ignored the warning. Ms Banks was a stranger to the parenting proceedings before the Court and the mother should have ensured that she had a sound case before drawing her into litigation. Impecuniosity is not a shield against costs orders.
The mother will be ordered to pay the costs of Ms Banks and the father.
The quantification of costs
It is submitted that Ms Banks and the father should receive a level of indemnity that is greater than party and party costs. It is submitted that the Court should make an assessment rather than relying on the parties to reach agreement or to undergo a formal assessment process by a registrar.
The Family Law Rules 2004 address the assessment of costs in this way:
FAMILY LAW RULES 2004 - RULE 19.18
Method of calculation of costs
(1) The court may order that a party is entitled to costs:
(a) of a specific amount;
(b) as assessed on a particular basis (eg lawyer and client, party/party or indemnity);
(c) to be calculated in accordance with the method stated in the order; or
(d) for part of the case, or part of an amount, assessed in accordance with Schedule 3.
Example
For paragraph (1) (c), the stated method may be in accordance with Schedule 3 but with an additional percentage for complexity.
(2) If costs are payable under the Act or these Rules, or the court orders that costs be paid and does not specify the method for their calculation, the costs are to be assessed on a party/party basis.
(3) In making an order under subrule (1), the court may consider:
(a) the importance, complexity or difficulty of the issues;
(b) the reasonableness of each party's behaviour in the case;
(c) the rates ordinarily payable to lawyers in comparable cases;
(d) whether a lawyer's conduct has been improper or unreasonable;
(e) the time properly spent on the case, or in complying with pre‑action procedures; and
(f) expenses properly paid or payable.
As to the basis of a costs assessment, there is an argument for the applicants receiving more than the level of costs indemnity available on a party and party basis. Rule 19.18 reveals the breadth of the options available to me.
In Stephens & Stephens and Anor (Enforcement) (Costs) [2010] FamCAFC 172 the Full Court discussed the approach to costs:
65.As to the relationship between s 117(1) and s 117(2) of the Act in Penfold v Penfold (1980) 144 CLR 311, in joint reasons, Stephen, Mason, Aickin and Wilson JJ said at 315:
It is an accurate description of s. 117 (1) to say that it expresses a general rule, provided that it is firmly understood that the sub-section is not paramount to s. 117 (2). As sub-s. (1) is expressed to be subject to sub-s. (2) the former must yield whenever a judge finds in a particular case that there are circumstances justifying the making of an order for costs.
Sub-section (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order. Beyond this there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs. Consequently, with respect to their Honours in the Family Court, we do not agree with the suggestion made in the judgment under appeal that an order can only be made under s. 117 (2) in “a clear case”. (emphasis added)
66.As to the nature of the hearing of an application pursuant to s 117 of the Act in Penfold their Honours said at 315-16:
Sub-section (2) does not in our view as a matter of law require the judge to specify the circumstances which justify the making of an order. It does not expressly say so, and in the context of the making of an order for costs there is no sufficient basis for making an implication. Judges very frequently make orders for costs without giving reasons or making findings, even when costs are in issue. The absence of reasons or findings does not in itself indicate that a judge has erroneously exercised his discretion to award costs, though it will place an appellate court in the position of examining the circumstances and of determining for itself whether the circumstances show that the discretion was erroneously exercised (Kent v. Kent [(1970) 92 W.N. (NSW) 503, at p. 505]). Accordingly, in the absence of some positive legislative indication we should not attribute to Parliament the requirement that a judge must make particular findings in relation to an order for costs.
67.We also observe that in Re JJT; Ex parte Victoria Legal Aid (1998) 195 CLR 184 the majority of the High Court (Gaudron, Gummow, Hayne and Callinan JJ, Kirby J dissenting) held that s 117(2) of the Act referred to costs in the conventional sense and thus to the payment by one party to litigation of money by way of a partial indemnity for professional legal fees and expenses actually incurred by another party in the course of the litigation: see Hayne J at 219. An order for costs is made to compensate a party against expense incurred in litigation and is not punitive in nature. Costs are not a penalty or damages: Latoudis v Casey (1990) 170 CLR 534 per Mason CJ at 543 and McHugh J at 567; Ruddock and Ors v Vadarlis and Ors (2001) 188 ALR 143 per Full Court of the Federal Court at [12] and Brott and Joachim (2006) FLC 93-259 per Full Court (Holden, Warnick and Boland JJ) at 80,403-404.
The Full Court in Stephens later turned to the question of indemnity costs as follows:
Indemnity Costs
72.The Family Court has jurisdiction to make orders for indemnity costs: McAlpin and McAlpin (1993) FLC 92-411 per Full Court (Nicholson CJ and Maxwell J, Baker J dissenting); Kohan and Kohan (1993) FLC 92-340 per Full Court (Strauss, Lindenmayer and Bulley JJ); Munday v Bowman (1997) FLC 92-784 per Holden J; Yunghanns & Ors v Yunghanns & Ors and Yunghanns (2000) FLC 93-029 per Full Court (Lindenmayer and Holden JJ, Mullane J dissenting) and Limousin v Limousin (Costs) (2007) 38 Fam LR 478 per Full Court (Kay, Coleman and Boland JJ).
73.An order for costs may be made on an indemnity basis, subject to a judicial determination capable of being made that there ought to be a departure from the usual basis that costs be payable on the party and party basis. For a discussion of the jurisdiction to order indemnity costs and its exercise see Colgate Palmolive Co and Another v Cussons Pty Ltd (1993) 118 ALR 248 per Sheppard J at 256-257 and NMFM Property Pty Ltd and Others v Citibank Ltd (No 2) (Court’s “NMFM” Judgment No 11) (2001) 109 FCR 77 per Lindgren J at [53] to [90].
In Colgate Palmolive Co and Another v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225 Sheppard J reviewed the English and Australian authorities about costs generally and at pages 232 to 233 said
It seems to me that the following principles or guidelines can be distilled out of the authorities to which I have referred:-
1.The problem arises in adversary litigation, i.e. litigation as between parties at arm's length. Different considerations apply where parties may be found to be entitled to the payment of their costs out of a fund or assets being administered by or under the control of a trustee, liquidator, receiver or person in a like position, eg. a government agency or statutory authority.
2. The ordinary rule is that, where the Court orders the costs of one party to litigation to be paid by another party, the order is for payment of those costs on the party and party basis. In this Court the provisions of Order 62, rules 12 and 19, and the Second Schedule to the Rules will apply to the taxation. In many cases the result will be that the amount recovered by the successful party under the Order will fall short of (in many cases well short of) a complete indemnity.
3. This has been the settled practice for centuries in England. It is a practice which is entrenched in Australia. Either legislation (perhaps in the form of an amendment to rules of Court) or a decision of an intermediate court of appeal or of the High Court would be required to alter it. No doubt any consideration of whether there should be any change in the practice would require the resolution of the competing considerations mentioned by Devlin LJ in Berry v. British Transport Commission and Handley JA in Cachia v. Hanes on the one hand and by Rogers J in Qantas on the other. The relevant passages from the respective judgments have been earlier referred to.
4. In consequence of the settled practice which exists, the Court ought not usually make an order for the payment of costs on some basis other than the party and party basis. The circumstances of the case must be such as to warrant the Court in departing from the usual course. That has been the view of all judges dealing with applications for payment of costs on the indemnity or some other basis whether here or in England.
The tests have been variously put. The Court of Appeal in the childs v. Barnes (39 Ch D at 141) said the Court had a general and discretionary power to award costs as between solicitor and client "as and when the justice of the case might so require." Woodward J in Fountain Selected Meats appears to have adopted what was said by Brandon LJ (as he was) in Preston v. Preston ((1982) 1 All ER at 58) namely, there should be some special or unusual feature in the case to justify the Court in departing from the ordinary practice. Most judges dealing with the problem have resolved the particular case before them by dealing with the circumstances of that case and finding in it the presence or absence of factors which would be capable, if they existed, of warranting a departure from the usual rule. But as French J said (at 8) in Tetijo, "The categories in which the discretion may be exercised are not closed". Davies J expressed (at 6) similar views in Ragata.5. Notwithstanding the fact that that is so, it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion. I instance the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud (both referred to by Woodward J in Fountain and also by Gummow J in Thors v. Weekes(1989) 92 ALR 131 at 152; evidence of particular misconduct that causes loss of time to the Court and to other parties (French J in Tetijo); the fact that the proceedings were commenced or continued for some ulterior motive (Davies J in Ragata) or in wilful disregard of known facts or clearly established law (Woodward J in Fountain and French J in J-Corp); the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions (Davies J in Ragata); an imprudent refusal of an offer to compromise (eg Messiter v. Hutchinson (1987) 10 NSWLR 525, Maitland Hospital v. Fisher (No. 2) (1992) 27 NSWLR 721 at 724 (Court of Appeal), Crisp v. Keng (Supreme Court of New South Wales, 27 September 1993, unreported, Court of Appeal) and an award of costs on an indemnity basis against a contemnor (eg Megarry V-C in EMI Records). Other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for payment of costs other than on a party and party basis.
6. It remains to say that the existence of particular facts and circumstances capable of warranting the making of an order for payment of costs, for instance, on the indemnity basis, does not mean that judges are necessarily obliged to exercise their discretion to make such an order. The costs are always in the discretion of the trial judge. Provided that discretion is exercised having regard to the applicable principles and the particular circumstances of the instant case its exercise will not be found to have miscarried unless it appears that the order which has been made involves a manifest error or injustice.
As I said in Bodilly & Hand (No. 2) [2012] FamCA 734 - The approach to the quantification of costs is not the result of law made or developed under the Act, not even in this century nor in the last. In his book Taxation of Costs Between Parties,[1] A G Saddington discussed the process of the quantification of costs by taxing officers. He traced the development of the practice and law of awarding costs from the time in English courts when a person could first have a representative present his case. The author explained that every costs award is by way of indemnity and discussed the extent of the indemnity that had been approved. The author discussed various authorities in relation to the assessment of costs on different bases and gives examples of things that have been allowed and not allowed. In relation to an assessment of party and party costs he said:
The costs to be allowed on this class of taxation are all that are necessary to enable the litigation to be properly conducted, all charges incurred merely for conducting litigation more conveniently are considered luxuries, for which the party who incurred them must pay.
[1] 1919, published by the Law Book Company of Australia.
As to an assessment of party and party costs on a solicitor and client basis the learned author said:[2]
It appears, therefore, that on a taxation between parties on a solicitor and client basis, the unsuccessful party has to pay all the costs incurred by his opponent excepting in respect of (1) costs and expenses incurred prior to the institution of the action; (2) journeys and expenses of which the party liable could have no knowledge, and which would not ordinarily be performed or incurred; (3) the employment of more counsel, or the payment to them of larger fees than the circumstances of the case warrant, including the giving of special retainers.
[2] Page 68.
As I noted, the examples may not still be apposite in the context of our world of costs agreements, pre-action procedures and video conferencing, but they give an indication of the margin that a calculation on such a basis could have over a party and party award.
Coming back to the proceedings before me. Ms Banks claims $17,311.43. The claim is asserted to amount to party/party costs made up of $4,065 in solicitors’ fees and disbursements and $13,246.43 by way of counsel’s fees. The work done by counsel is detailed in the accounts attached to the affidavit of Ms Banks and that detail was available to the mother. Although described by Ms Banks’ solicitor as party/party costs, the claim for counsel’s fees seems to be the same as the invoices sent by counsel. That suggests that the calculation is made on a more generous basis than party/party. The component for profit costs and disbursements in respect of the work of Ms Banks solicitor is not itemised but represents small component of the claim. Some of the necessary work by that solicitor is referred to in the invoices of counsel for example attending upon Ms Vlahos on 26 November 2012.
In my view Ms Banks should receive a substantial component of her costs claim.
There is force in the suggestion that the Court fix the quantum of costs. The substantive proceedings have been drawn out and strongly contested. There have been a number of applications for special leave to appeal to the High Court in what remain interlocutory proceedings. The parties are unlikely to agree and formal costs assessment proceedings would be burdensome for the parties and the tax payer.
I will order that the mother pay $14,000 to Ms Banks, which I intend to represent a party and party award. No submissions were made in relation to the time to pay any costs award. The mother is involved in a number of proceedings and asserts that she has not been able to return to the paid workforce. I will order that the costs be paid within six months.
The father seeks $10,125. Through his solicitor he provided the mother and the Court with an itemised account during the costs hearing. For reasons that I do not quite follow the account[3] was prepared on a time only basis relying on an hourly rate for the father’s solicitor that is less than the rate that the father will be charged but more than the hourly rate provided for under the relevant scale. Mr Holmes did argue that the Court should assess the costs award on a more generous basis than party and party.
[3] Exhibit 2.
However, Mr Holmes correctly submitted that the mother should have an opportunity to make submissions on the account. That means I cannot make an assessment without hearing further from the mother. In that event and despite the sense in avoiding further satellite litigation, the best course is or order that costs be as agreed or assessed. As I have noted, Mr Holmes argued against such a course but it is my understanding that a costs order may have been made on a similar basis by the Full Court in relation to an appeal. That means that the parties are already committed to either compromising a costs issue or undertaking the process of assessment by a taxing officer (Deputy Registrar).
As to the basis on which the agreement or assessment should proceed, in my view the father should have his costs on the usual basis. In my view the mother carelessly embarked on her case against the father but the circumstances are accommodated by the usual level of indemnity.
I will not specify a time to pay. That will be addressed by the parties’ agreement or the outcome of the assessment process.
Conclusion under Section 117
The matters I am obliged to take into account support the granting of the applications for costs. Although there are aggravating features of the case, the circumstances do not warrant a level of indemnity beyond an award of costs on a party and party basis. The mother had the opportunity to consider the quantum of costs claimed on behalf of Ms Banks and therefore I am in a position to make an assessment of an appropriate award. That is not possible in relation to the costs incurred by the father. They will be as agreed or assessed.
I certify that the preceding fifty five (55) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 13 September 2013.
Associate:
Date: 13 September 2013
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