Barry and Dalrymple
[2011] FamCAFC 186
•12 September 2011
FAMILY COURT OF AUSTRALIA
| BARRY & DALRYMPLE | [2011] FamCAFC 186 |
| FAMILY LAW – APPEAL – COSTS – application for costs of an abandoned appeal – where the appeal was deemed abandoned because the appellant failed to comply with an order for the filing of appeal books as a result of his impecuniosity – where there was a large disparity in the financial circumstances of the parties – where the appellant made various attempts to raise funds to pursue the appeal – where the appellant would be unable to pay an order for costs – application for costs dismissed – each party to bear their own costs. |
| Family Law Act 1975 (Cth) s 117 |
| APPLICANT: | Mr Dalrymple |
| RESPONDENT: | Mr Barry |
| FILE NUMBER: | PAC | 2365 | of | 2010 |
| APPEAL NUMBER: | EA | 7 | of | 2011 |
| DATE DELIVERED: | 12 September 2011 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | Finn, Thackray & Strickland JJ |
| HEARING DATE: | 23 August 2011 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 15 December 2010 |
| LOWER COURT MNC: | [2010] FamCA 1271 |
REPRESENTATION
| SOLICITOR FOR THE APPLICANT: | Ms Smythe - Taussig Cherrie Fildes |
| SOLICITOR FOR THE RESPONDENT: | Mr Brown - Browns the Family Lawyers |
Orders
The Application in an Appeal filed on 19 May 2011 be dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Dalrymple & Barry 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 SYDNEY |
Appeal Number: EA 7 of 2011
File Number: PAC 2365 of 2010
| Mr Dalrymple |
Applicant
And
| Mr Barry |
Respondent
REASONS FOR JUDGMENT
Introduction
This is an application filed on 19 May 2011 by the respondent in an appeal which has been deemed abandoned (“the applicant”) seeking an order that the appellant in the appeal (“the respondent”) pay costs in the sum of $9,096.87 in relation to the abandoned appeal.
During the hearing the solicitor for the applicant conceded that she could not maintain a claim for that amount of costs given that they were calculated on a solicitor/client or indemnity basis and there was no exceptional circumstance to justify the costs being calculated on anything other than a party/party basis. Accordingly, the applicant now seeks that the costs be as agreed and in default of agreement as assessed.
The respondent filed a response seeking that the application be dismissed.
Brief background
On 15 December 2010 Coleman J made orders dismissing the application of the respondent for adjustment of property under the Family Law Act 1975 (Cth) (“the Act”).
On 23 December 2010 the respondent filed a Notice of Appeal against the orders made by Coleman J.
The respondent then filed a Draft Appeal Index as required by the Family Law Rules 2004 (Cth) (“the Rules”).
On 24 February 2011 standard directions were made by the Appeal Registrar for the preparation of the appeal for hearing. Paragraph 3 of those orders provided for the respondent to prepare, file and serve the appeal books on or before 21 April 2011.
The respondent failed to comply with paragraph 3 of those orders. He says that he was unable to do so because he could not afford to obtain the transcript.
On 2 May 2011 the Appeal Registrar confirmed by letter to the parties that pursuant to r 22.21 of the Rules the appeal was taken to be abandoned.
On 19 May 2011 the applicant filed an Application in an Appeal seeking an order for costs.
The evidence
The applicant relied on two affidavits filed by his solicitors on 19 May 2011 and 15 August 2011 respectively. The respondent relied on his affidavit and financial statement both sworn on 19 August 2011.
The applicable legislation
An application for costs is governed by section 117 of the Act, and the relevant subsections are as follows:
(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.
Discussion
To succeed in a costs application it is necessary to establish that there are circumstances that justify making an order for costs.
In this regard the applicant relies on the failure of the respondent to comply with the order for the filing of appeal books which resulted in the appeal being deemed abandoned. That circumstance perhaps brings into play subparagraph (c) or (e) of s 117(2)(A) of the Act or at the very least subparagraph (g).
There is no doubt that prima facie this is a circumstance that justifies an order for costs being made, but the respondent relies on the financial circumstances of the parties which also must be taken into account in considering what (if any) order should be made. The solicitor for the respondent submits that the disparity in the financial circumstances of the parties in this case should result in each party bearing their own costs, despite the circumstances of the appeal being deemed abandoned.
The solicitor also relies on the explanation by the respondent for his failure to comply with the order and the efforts that he went to to be able to pursue the appeal, as relevant matters pointing to the outcome that the respondent seeks.
In relation to the financial circumstances of the parties the respondent filed a financial statement which indicates that he has no income, that his personal expenditure is $63 per week, that he has assets totalling in value $58,858, superannuation of $15,676.05 and liabilities of $65,484.38. The assets comprise two motorcycles respectively valued by the respondent at $42,930 and $10,525, household contents of $1,400 and jewellery of $4,000. His liabilities are entirely made up of the legal fees that he incurred in relation to the proceedings before Coleman J. At the time of the hearing he was living with his step-father who pays the rent for their accommodation.
There is no detailed evidence before us as to the applicant’s financial circumstances but we understand from the appeal documents and from concessions made by his solicitor that he is a multi-millionaire and thus a man of substantial means.
The solicitor for the applicant submitted that despite the apparent impecuniosity of the respondent he in fact would be able to meet an order for costs by selling the motorcycles. However, as is apparent from the affidavit evidence, the applicant is not only the one in possession of those motorcycles but he also claims a lien over them. Indeed, one of the avenues explored by the respondent in attempting to raise sufficient funds to purchase the transcript was to sell those motorcycles, but the applicant would not release them to him.
The solicitor for the applicant also submitted that if an order for costs was made it would be able to be enforced by the applicant selling those motorcycles. The difficulty with this though is the lien or liens that the applicant claims. They would have to be satisfied after the costs of sale and the solicitor for the applicant could not tell us if the amount of money allegedly secured by the lien or the liens would leave any equity in the motorcycles to be available to meet the order for costs.
It is readily apparent to us that the respondent would be unable to pay any order for costs. Further, that highlights the significant disparity between the financial circumstances of the parties which to repeat is highly relevant in the exercise of our discretion.
It is also relevant to the exercise of our discretion that it was the impecuniosity of the respondent that ultimately led to the abandonment of his appeal. It is clear that he made every effort that he could to raise the funds to obtain the transcript, but he has been unsuccessful to date. His request of the applicant to return the motorcycles to him was rejected. He then attempted to borrow sufficient money from his step-father but ultimately his step-father was unable to lend him enough to purchase the transcript. He then applied for financial assistance from the Commonwealth Attorney-General but as at the date of the swearing of his affidavit, namely 19 August 2011, he had not received a formal response to that request. He also applied for legal aid but that application was refused. He then appealed against that decision, and at the time of the hearing he was still awaiting the result of that appeal.
We also observe that in the meantime the respondent sought the consent of the applicant to an extension of time to file the appeal books on the basis that he needed more time to be able to fund the cost of obtaining the transcript and preparing the appeal books. That request was denied by the applicant.
The solicitor for the applicant made the point to us that the respondent was put on notice by the applicant that if he pursued the appeal and he was unsuccessful, costs would be sought against him. However, the proceedings before Coleman J were not without complexity, and we are not able to say that the appeal was bound to fail.
Conclusion
Taking into account all of the relevant factors to which we have been referred, but primarily the disparity in the financial circumstances of the parties and the unfortunate consequences for the respondent of his impecuniosity in relation to the appeal, we propose to dismiss the application for costs, leaving the parties to each bear their own costs.
I certify that the preceding twenty-five (25) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Finn, Thackray and Strickland JJ) delivered on 12 September 2011.
Associate:
Date: 12 September 2011
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