Bashir & Ghani (No 3)
[2021] FCCA 807
•23 April 2021
FEDERAL CIRCUIT COURT OF AUSTRALIA
Bashir & Ghani (No 3) [2021] FCCA 807
File number(s): PAC 4940 of 2016 Judgment of: JUDGE OBRADOVIC Date of judgment: 23 April 2021 Catchwords: FAMILY LAW – Practice and Procedure – Costs – Application for costs on an indemnity basis – costs order made in accordance with scale. Legislation: Family Law Act 1975, s 117
Federal Circuit Court Rules2001, r 21.02, sch 1
Cases cited: Bashir & Ghani [2017] FCCA 3448
Bashir & Ghani (No.2) [2021] FCCA 253
Colgate Palmolive Co and Anor v Cussons Pty Ltd [1993] FCA 801
Collins & Collins [1985] FamCA 15
Penfold & Penfold [1980] HCA 4
Kohan & Kohan (1993) FLC 92-340
Latoudis v Casey [1990] HCA 59Sala & Habner (No. 2) [2018] FCCA 2738
Wrensted & Eades [2016] FamCAFC 46
Number of paragraphs: 32 Date of last submission/s: 31 March 2021 Date of hearing: On the papers Place: Parramatta Solicitors for the Applicant Fay Rose Legal Counsel for the Respondent Mr Leidermann Solicitors for the Respondent Falzon Legal Pty Ltd ORDERS
PAC 4940 of 2016 BETWEEN: MS BASHIR
Applicant
AND: MR GHANI
Respondent
ORDER MADE BY:
JUDGE OBRADOVIC
DATE OF ORDER:
23 APRIL 2021
THE COURT ORDERS THAT:
1.The Applicant mother pay the Respondent father’s costs in the amount of $23,284.90 within 6 months.
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment under the pseudonym Bashir & Ghani (No 3) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE OBRADOVIC
On 22 November 2017, final parenting orders were made with respect to the parties’ two children, X born in 2012 and Y born in 2015, (“final parenting orders”). The final parenting orders provided for:
a.The father to have sole parental responsibility for the children;
b.The children to live with the father; and
c.The children to be permitted to travel internationally without the need for the consent of the mother to be provided to the issue of a passport for the children.
The final parenting orders were made in circumstances where the mother did not participate at final hearing and in her absence. Reasons for judgement were delivered ex tempore (but subsequently published): Bashir & Ghani [2017] FCCA 3448.
On 25 June 2020, the mother commenced fresh proceedings for parenting orders. On 7 December 2020, the father filed a response seeking orders dismissing the mother’s application and for costs. The matter proceeded to hearing on the Rice & Asplund issue on 5 February 2021.
On 17 February 2021, the Court delivered its reasons and dismissed the mother’s Initiating Application filed 25 June 2020: Bashir & Ghani (No.2) [2021] FCCA 253. After the orders were made, the father advised the Court that he pressed his application for costs, and procedural orders were then made for the filing of evidence and submissions in respect of that costs application. For some unknown reason the father filed an Application in a Case on 22 March 2021, moving the Court for orders, which are unsensical and unnecessary, as follows:
The Father seeks an order that his costs of dealing with the present application be paid by the Mother. If the court makes an order that the Mother pay any of his costs, the court can appropriately rely upon the same justifying circumstances to award the Father his costs for his current application seeking costs.
On 24 March 2021, one day after the time for doing so as provided for in orders made on 17 February 2021, the father filed an affidavit and submissions in respect of the costs application. The mother objects to the late filing of the affidavit and submissions, although she does not herself outline any prejudice. While no explanation has been provided by the father as to why he did not comply with the filing directions, in circumstances where the documents were filed on the morning of the day following the last day for filing and where no prejudice has been raised, the Court is prepared to consider the late filed material.
The mother has also filed an affidavit and submissions in respect of the father’s costs application, which the Court has had regard to.
The application for costs
It appears from the father’s affidavit that he is not only seeking costs on an indemnity basis of the proceedings filed in 2020 and decided in 2021 (“2020 proceedings”), but that he is also seeking costs on an indemnity basis of the proceedings filed in 2016 and decided in 2017 (“2016 proceedings”).
No leave has been sought for a costs application in respect of the 2016 proceedings to be brought out of time, and no leave has ever been granted in respect of making such a costs application. It is therefore difficult to understand why the father has then sought to refer to those matters when there is no application for costs in respect of the 2016 proceedings before the Court. Submissions filed on behalf of the father do not shed any light on this issue.
Indeed, submissions filed on behalf of the father do not shed any light on why the amounts sought by the father are appropriate and reasonable and why an order for indemnity costs is in all of the circumstances appropriate. The submissions fail to address the basis upon which the costs are sought to be assessed.
The father’s evidence is that he has incurred $64,621.71 in legal costs (including disbursements). While he annexes to his affidavit the various tax invoices relating to the fees he has been charged by his solicitor and the fees charged by his barrister, a number of things remain a mystery:
a.The tax invoices from the solicitor are not particularised for the work which was performed by the solicitor so it is impossible to understand what work the solicitor actually did for the father.
b.An example of the fees charged is as follows:
(table removed)
c.The above charges are difficult to understand, more so without being particularised, when:
(i)The first return date of the mother’s application was on 14 September 2020 and the matter was heard electronically;
(ii)On 14 September 2020 the Court set the Rice & Asplund issue for a threshold hearing on 27 January 2021 and made orders for the preparation of the matter for hearing;
(iii)The father filed two affidavits relied upon at the hearing, on 14 September 2020 and 27 January 2021 respectively, the second affidavit being very short;
(iv)On 27 January 2021 the matter came before the Court but was marked not reached and the matter was listed for hearing on 5 February 2021 - presumably preparation for the hearing had been completed prior to 27 January 2021 and did not need to be repeated in the space of just over a week. The matter was heard electronically on 27 January 2021;
(v)On 5 February 2021, the matter was before the Court for less than 2 hours on the threshold issue and the decision was reserved by 1pm. Once again the hearing took place electronically;
(vi)Reasons for decision were delivered on 17 February 2021 and orders made, with additional procedural orders regarding costs;
(vii)The affidavit filed by the father on 24 March 2021 in respect of the costs application contains material which is utterly irrelevant to the father’s costs application of the 2020 proceedings and repeats matters which were contained in an earlier affidavit of the father; and
d.Why the same solicitors who acted for the father in the 2016 proceedings charged the father more for the 2020 proceedings than they did for the 2016 proceedings?
There is no evidence that the father has sought to have the legal costs which he has been charged assessed, although it is difficult to understand why he would not have done so already. To have incurred close to $65,000 in legal costs and disbursements for litigation which ran less than 8 months with very limited evidence is a cause of concern and a matter the father may well worth consider reporting to the Legal Services Commissioner.
Relevant Legal Principles Relating to Costs in Family Law Proceedings
The principles in respect of costs orders in family law proceedings are well known. The starting position with respect to costs, as set out in s.117 of the Act is that, subject to subsection 117(2), each party to proceedings under the Act shall bear his or her own costs.
The discretion to award costs is a broad discretion (see for example Collins & Collins [1985] FamCA 15).
The High Court held in Penfold & Penfold [1980] HCA 4 that it is necessary for the Court to make a finding of justifying circumstances as an essential preliminary to the making of an order for costs. The Court is not required to specify the circumstances which justify the making of such an order.
As long as there is an essential preliminary finding that there are justifying circumstances to make a costs order, there is no additional or special onus which the Applicant needs to establish for an order for costs. It is not the law that a costs order can only be made in what has been described as a ‘clear case’ (See in general the comments made by the Full Court in Wrensted & Eades [2016] FamCAFC 46 and in particular where the Full Court approved the comments of the judge below at [103]).
In Latoudis v Casey [1990] HCA 59 (“Latoudis”) the High Court stated as follows:
… in exercising its discretion to award or refuse costs, a court should look at the matter primarily from the perspective of the defendant. To do so conforms to fundamental principle. If one thing is clear in the realm of costs, it is that, in criminal as well as civil proceedings, costs are not awarded by way of punishment of an unsuccessful party. They are compensatory in the sense that they are awarded to indemnify the successful party against the expense to which he or she has been put by reason of the legal proceedings.”
(Referred to in the context of family law proceedings by Judge Kemp in Coggan & Coggan [2012] FMCAfam 984 at [17])
In determining what order, if any, should be made under s.117(2) the Court must have regard to the prescriptive but non-exhaustive list of considerations in sub-section (2A).
Rule 21.02(2) Federal Circuit Court Rules2001 (“the Rules”) provides that in making an order for costs the Court may set the amount of costs; or set the method by which the costs are to be calculated; or refer the costs for taxation under Part 40 of the Rules or under Chapter 19 of the Family Law Rules 2004.
The Court has the power to order costs on an indemnity basis (see for example, Kohan & Kohan (1993) FLC 92-340; Latoudis). The principles in respect of indemnity costs orders are also well known (see generally Sheppard J in Colgate Palmolive Co and Anor v Cussons Pty Ltd [1993] FCA 801), and in essence may be summarised as follows:
a. the application of the ordinary well-settled rule of costs being ordered on a party and party basis will usually result in the amount received by the successful party falling short of a complete indemnity;
b. some special or unusual feature of the case must, in the circumstances, warrant departure from the well-settled practice of awarding costs on a party and party basis including an imprudent refusal of an offer of compromise; and
c. even if facts exist to justify the making of an indemnity costs order, such an order need not necessarily be made because costs are always in the discretion of the court
(Sala & Habner (No. 2) [2018] FCCA 2738 at [3]).
Court’s Determination
The father’s financial circumstances have been severely impacted by the 2016 proceedings, not only in terms of the costs which the father had incurred in those proceedings, but also in terms of the toll the proceedings had on his capacity to earn an income.
The father says in respect of the 2016 proceedings that he incurred $47,338.09 in legal fees (including $6,270 in barrister’s fees). The father refers to the 2016 proceedings as a “three year litigation” even though those proceedings were commenced on 20 October 2016 and finalised on 27 November 2017 (which is less than 14 months and well short of three years).
The father funded the 2016 proceedings through a loan from a family friend for “legal expenses and other expenses”. He still owes his friend $57,500. There is no evidence as to what the “other expenses” relate to, nor how much of his legal costs he has repaid to date.
The father presently lives with the children, his partner and her children in Western Australia. The particulars of his income and expenses, or indeed the income and expenses of others in his household, are not the subject of any evidence.
Neither party has filed a financial statement.
The mother had a grant of legal aid for the 2020 proceedings. Why her application was considered meritorious such that she was granted legal aid is another mystery in these proceedings.
It is a fact that the mother was able to conduct these proceedings without any personal financial cost while the father has incurred significant costs as a result of meeting the mother’s application. It is worth repeating that the father has incurred close to $65,000 in legal costs and disbursements as a result of the latest round of litigation between the parties. This means that the father has incurred over $100,000 in legal costs and disbursements to date (in both sets of proceedings).
The mother was wholly unsuccessful in these proceedings. Indeed, the mother was wholly unsuccessful in the 2016 proceedings with no costs consequences.
The father makes the submission that the motivation behind the mother commencing proceedings in 2020 was financial gain, that is, she attempted to intimidate the father into paying her a sum of money in return for discontinuing with the proceedings. Those matters are presently the subject of a criminal charge against the mother and were to be last before the Local Court at Suburb G on 22 March 2021.
The Court is satisfied that there are circumstances justifying a costs order and having regard to the s.117(2A) matters that a costs order ought to be made. However, the circumstances do not justify the making of a costs order on an indemnity basis, particularly where the costs which the father has incurred appear to be outrageously large.
The Court assesses the costs in accordance with Schedule 1 of the Rules as follows (excluding counsel’s fees):
a.Item 2: Opposing an application which includes interim orders up to the completion of the first court date, both:
(i)$,2802 and
(ii)Short mention: $305;
b.Item 6: Preparation for final (threshold) hearing, one day matter: $4,775;
c.Item 13: Daily hearing fee
(i)For 27 January 2021 – half day hearing (not reached): $1,120
(ii)For 5 February 2021- half day hearing $1,120;
d.Item 14: Disbursements as particularised $4,197.90
Total: $14,319.90
The Court certifies that it was reasonable for Counsel to be briefed, and that the costs charged were reasonable.
Therefore, the total costs are assessed as $23,284.90. Such costs are to be paid within 6 months.
I certify that the preceding thirty-two (32) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Obradovic. Associate:
Dated: 23 April 2021
0
8
0