Batson and Ors and Batson

Case •

[2020] FamCA 530

•

3 July 2020

FAMILY COURT OF AUSTRALIA

BATSON AND ORS & BATSON [2020] FamCA 530
FAMILY LAW – COSTS – Where the husband was not wholly unsuccessful against the wife – Where the husband received a larger percentage of the assets at final hearing than offered in settlement – Wife’s application for costs dismissed – Where the husband was wholly unsuccessful against the 2nd and 3rd applicants – Where the husband does not have the financial means to pay costs – Where it would not be just and equitable to make an Order for costs – Application dismissed.
Family Law Act 1975 (Cth) ss 117(1), (2), (2A)
1st APPLICANT: Ms Batson
2nd APPLICANT: Mr Garey
3rd APPLICANT: Ms Garey
RESPONDENT: Mr Batson
FILE NUMBER: SYC 8148 of 2017
DATE DELIVERED: 3 July 2020
PLACE DELIVERED: Sydney
PLACE HEARD: Sydney
JUDGMENT OF: Rees J
IN CHAMBERS: 3 July 2020

REPRESENTATION

COUNSEL FOR THE 1ST, 2ND

& 3RD APPLICANTS:

 Ms Judge

SOLICITOR FOR THE 1ST, 2ND

& 3RD APPLICANTS:

 Jason Li Lawyers
SOLICITOR FOR THE RESPONDENT: Crawford Ryan Lawyers Pty Limited

Orders

IT IS ORDERED

  1. That the applications for costs are dismissed.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Batson & Batson has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 8148 of 2017

Ms Batson

1st Applicant

And

Mr Garey

2nd Applicant

And

Ms Garey

3rd Applicant

And

Mr Batson

Respondent

REASONS FOR JUDGMENT

  1. On 2 March 2020, I delivered reasons and made orders in relation to the settlement of property between Mr Batson (“the husband”) and Ms Batson (“the wife”).

  2. The wife’s parents were parties in the proceedings as the second and third respondents. They were joined because of the husband’s claim that he and the wife were beneficially entitled to the ownership of a property at Suburb C which was legally owned as to 99 per cent by the second and third respondents.

  3. That claim was ultimately dismissed.

  4. The wife and the second and third respondents now each seek an order that the husband pay their costs.

  5. The wife seeks payment of $107,065.57 which is 80 per cent of the costs actually paid. In the alternate, the wife seeks costs as agreed or assessed on “an ordinary basis” which I infer to mean party and party costs, or further in the alternate, “in such sum and on such basis as determined appropriate by the Court”.

  6. The second and third respondents seek indemnity costs or, in the alternate, $64,894.58 which is 80 per cent of the costs actually incurred. Further in the alternate they seek costs either “as agreed or assessed on the ordinary basis for the whole of the proceedings” or further again, “in such sum and on such basis as determined appropriate by the Court”.

  7. The applications are opposed by the husband.

  8. All parties have filed written submissions and this application is determined in Chambers.

  9. The applications proceed in accordance with the provisions of s 117(2) and s  117(2A) of the Family Law Act 1975 (Cth) (“the Act”) which is set out below:

    (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), (4A), (5) and (6) 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.

THE WIFE’S APPLICATION

  1. The respective financial positions of the husband and the wife are a relevant consideration.

  2. The wife has a small business in the finance industry. Her income was stated by her variously to be $50,000 or $37,000. She lives in a property owned as to 99 per cent by her parents for which she does not pay rent. The evidence does not suggest that there is any impediment to her continued occupation of the property. At trial, that property was agreed to be worth $1,800,000.

  3. In addition the wife has received generous financial support from her parents who have provided the funds to pay her legal fees in these proceedings. It is likely, as I found in the substantive proceedings, that the wife’s parents will continue to provide her with generous financial support.

  4. The wife has superannuation of $131,117.

  5. The orders require the wife to pay $33,611 to the husband but whether she will have to make that payment from her own funds is not established. Her parents may provide the money as they have in the past.

  6. The husband received a Newstart Allowance and now receives a Jobseeker payment which will revert to Newstart in September 2020.

  7. He is 62 and is no longer capable of manual work. He has no other skills and is not likely to find paid employment.

  8. He currently lives with his sister and brother-in-law. He has no property other than his superannuation of $148,027 at trial. He owes his lawyers $43,245 and had credit card debts of $53,380 at trial.

  9. The wife has not complied with the orders made in relation to payment of a lump sum to the husband or in relation to the sale of a boat and the division of the proceeds.

  10. The wife’s financial circumstances are significantly more favourable than those of the husband.   

  11. Although the written submissions on behalf of the wife refer to the conduct of the proceedings on behalf of the husband, they do not refer to any conduct on his behalf which exacerbated the costs of the proceedings, other than his persistence with an application which was ultimately unsuccessful.

  12. Whilst neither party was wholly unsuccessful, so neither party was wholly successful.

  13. The wife made serious allegations against the husband in relation to drug and alcohol abuse, excessive spending and family violence. As I stated in the substantive reasons:

    None of those allegations was made out and they were either not the subject of submissions or, in the case of the allegations of family violence, specifically abandoned.

  14. The wife relies on offers of settlement. On her behalf it is submitted that her offer to settle on the basis of an equal division of their superannuation and of her interest in the Suburb C property would have left the husband in a better position than that in which he ultimately found himself after the trial.

  15. The wife’s offer would have left the husband with the entire liability for the credit card debts incurred during the relationship and did not take into account the pontoon boat which the wife would have retained.

  16. Ultimately, the husband received 60 per cent of the net assets of the marriage, taking into account the credit card debts, which is more than the wife offered.

  17. Taking all of those matters into account, I do not propose to make the orders sought by the wife.

THE APPLICATION OF THE SECOND AND THIRD RESPONDENTS

  1. It is conceded in the written submissions on behalf of the respondents that “They clearly in [sic] a stronger financial position than the husband…”. They are self- funded retirees who described themselves as “asset rich but income poor”.

  2. The second and third respondents have paid the whole of the wife’s legal costs of $133,832. At trial, the wife claimed that her parents had advanced her a total of $261,359 which may have included some of the funds paid by them for legal costs. In the substantive reasons I referred to the lack of evidence on the part of the second respondent of an expectation that those funds would be repaid.

  3. As to the conduct of the proceedings, the second and third respondents submit that the documents which evidenced the withdrawal by the second respondent of funds from N Bank to lend to the husband and the wife for the purchase of F Street were provided to the husband on about 6 November 2018, shortly before the Conciliation Conference.

  4. On behalf of the husband, it is submitted that the documents referred to showed that the relevant bonds were in the name of the second respondent’s adult child not the second respondent.

  5. The trial affidavits of the wife and the second and third respondents were filed in August and September 2019.

  6. The evidence does not establish that, before that time, the husband had in possession the whole of the documents relied upon by the second and third respondents.

  7. The husband deposed that he sought, by letter from his solicitor dated 26  November 2018:

    … disclosure from the Second & Third Respondents with respect to the financial records which they have maintained with respect to the financial records which they have maintained with respect to the financing of their respective interests in the properties at [named address] in 1998 and subsequently 2001 , including the source documents evidencing the withdrawal of funds used to apply to the purchase of each of the relevant properties including but not limited to bank statements, conveyancing files and other documents demonstrating or tending to demonstrate the origin of the funds used to purchase each of the respective properties…

  8. The husband deposed that no response was received to that request until 10  July  2019.

  9. However, further documents were tendered in the course of the hearing in support of the claim of the second and third respondents and the wife. Thus it could not be asserted that the husband had all of the documents relevant to the claim of the wife and the second and third respondents by August or September  2019.

  10. Because the same solicitors and counsel acted for both the wife and the second and third respondents, it is impossible to distinguish whether particular actions during the hearing should be attributed to the wife or the second and third respondents.

  11. Throughout the trial, the cases of the wife and the second and third respondents, in relation to the ownership of various properties purchased throughout the marriage, and ultimately in relation to the ownership of Suburb C, were, in almost every respect, the same case.

  12. As against the second and third respondents, the husband was wholly unsuccessful.

  13. The primary position posited in section 117 (1) of the Act is that each party (including third parties) should pay his or her own costs. That position should only be departed from if the Court is satisfied that it is justified to do so.

  14. Had the husband been a man of even modest means, the consideration to be applied in this case might be different. However, his financial position is so parlous that I am unable to find that it would be just and equitable to make an order that he contribute to the costs of the second and third respondents.

  15. The applications for costs will be dismissed.

I certify that the preceding forty-one (41) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 3 July 2020.

Associate:

Date:  03/07/2020

Key Legal Topics

Areas of Law

  • Civil Procedure

Legal Concepts

  • Costs

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