Bauer & Nolan (No 5)
[2024] FedCFamC1F 68
•15 February 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Bauer & Nolan (No 5) [2024] FedCFamC1F 68
File number: WOC 1022 of 2019 Judgment of: CHRISTIE J Date of judgment: 15 February 2024 Catchwords: FAMILY LAW – COSTS – Undefended hearing – Where the costs proceedings have been extenuated in giving the respondent the opportunity to be heard – Where there is no response from the respondent – Conduct of the parties – Where the respondent disputed the Court’s jurisdiction and thereafter conceded same – Where the respondent was wholly unsuccessful – Where the respondent would have been in a better position had they accepted offers of settlement – Costs ordered. Legislation: Family Law Act 1975 (Cth) s 117
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 12.17
Cases cited: Bant & Clayton (Costs) (2016) 56 Fam LR 31
Bauer & Nolan (No 4) [2023] FedCFamC1F 598
D & D (Costs) (No 2) (2010) FLC 93-435
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Idoport Pty Ltd v National Australia Bank & Ors [2007] NSWSC 23
Stoian & Fiening (Costs) [2014] FamCA 944
Division: Division 1 First Instance Number of paragraphs: 64 Date of last submission: 6 February 2024 In Chambers: 15 February 2024 Place: Sydney Counsel for the Applicant: Ms Gillies SC with Mr Alexander Solicitor for the Applicant: Williams Family Law The Respondent: Litigant in person ORDERS
WOC 1022 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS BAUER
Applicant
AND: MS NOLAN
Respondent
ORDER MADE BY:
CHRISTIE J
DATE OF ORDER:
15 FEBRUARY 2024
THE COURT ORDERS THAT:
1.Within sixty days:
(a)The respondent pay the applicant’s costs of the proceedings from 9 September 2019 to 14 February 2022 on an indemnity basis in the fixed sum of $122,000;
(b)The respondent pay the applicant’s costs of the proceedings from 18 November 2022 to 20 July 2023 in the fixed sum of $83,000;
(c)The respondent pay the applicant’s costs of this application in the fixed sum of $10,000.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
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 by this Court under a pseudonym Bauer & Nolan has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
CHRISTIE J
On 20 July 2023 I made orders and delivered reasons in a final hearing (Bauer & Nolan (No 4) [2023] FedCFamC1F 598) in property proceedings under Pt VIII of the Family Law Act 1975 (Cth) (“the Act”). I made the following orders as to costs:
9.If either party wishes to file an application for costs then she do so within 28 days of the date of these orders, accompanied by an affidavit.
10.Any response to an application for costs and accompanying affidavit is to be filed within 14 days of service of the application.
11.Within 7 days of the filing of the response the parties are to notify my associate as to whether the costs application should be listed for hearing or determined in chambers.
12.In the event that the application for costs is to be determined in chambers the parties are to file costs submissions as follows:
(a)The applicant for costs within 7 days of notification to consent for the matter to be dealt with in chambers;
(b) The respondent within a further 7 days;
(c) Any brief response within a further 7 days.
(d)The submissions are to be limited to 5 pages in the case of the primary submission and 1 page in respect of the submission in reply.
On 16 August 2023, the applicant in the substantive proceedings, Ms Bauer, filed an Application in a Proceeding seeking that the respondent, Ms Nolan:
(a)Pay the applicant’s costs of the proceedings on an indemnity basis in the sum of $509,139.52 within 21 days;
(b)In the alternative, pay the applicant’s costs at scale as determined by the Court or otherwise as assessed or as agreed within 21 days;
(c)In the alternative, pay the applicant’s costs:
(i)On an indemnity basis in the sum of $122,170.21, or in any other sum fixed or as assessed or as agreed or at scale, for the costs of interlocutory proceedings from the commencement of those proceedings until the respondent conceded the Court had jurisdiction;
(ii)On an indemnity basis in the sum of $165,791.44, or in any other sum fixed or as assessed or as agreed or at scale, from the date of the without prejudice offer of settlement dated 18 November 2022 until the date of final judgment;
(iii)On an indemnity basis and in the sum of $4889, or in any other sum fixed or as assessed or as agreed or at scale, arising from subpoena and conduct money;
(iv)On an indemnity basis and in the sum of $12.912.63, or in any other sum fixed or as assessed or as agreed or at scale, arising from the Application in a Proceeding listed on 30 August 2021;
(v)On an indemnity basis and in the sum of $27,735.67, or in any other sum fixed or as assessed or as agreed or at scale, arising from two vacated hearing dates in February 2023;
(vi)On an indemnity basis and in the sum of $14,670.09, or in any other sum fixed or as assessed or as agreed or at scale, arising from the subpoena objection hearing on 10 February 2022; and
(vii)Or further in any other further sums fixed or as assessed or as agreed or at scale.
(d)Pay the applicant’s costs arising from the Application in a Proceeding seeking costs on an indemnity basis in the sum of $15,000, or in any other sum fixed or as assessed or as agreed or at scale.
The applicant filed an affidavit in support of the application on even date.
On 29 August 2023 the parties jointly emailed chambers seeking an extension of time for filing. I made orders in chambers by consent as follows:
1.Time for compliance with Order 10 of Orders dated 20 July 2023 be extended by deleting “14” and replacing it with “28”.
2.Time for compliance with Order 11 of Orders dated 20 July 2023 be extended by deleting “7” and replacing it with “14”.
On 25 September 2023 I made orders listing the matter for hearing on 12 October 2023 and noting that the respondent had failed to comply with the directions made on 20 July 2023 and 29 August 2023.
On 9 October 2023, my chambers received the following correspondence from the respondent detailing:
(1)Her health complications and hospital admissions;
(2)An apparent inability to see the court listing on the Commonwealth Court Portal; and
(3)That the respondent has not received contact from her legal representatives.
The communication from the respondent said:
I wish to Defend the Applicant’s Costs Application which appears to be maximum indemnity costs ie every cent she has spent on the litigation, in a jurisdiction where parties normally carry their own costs and legal costs already factored in in the Balance Sheet.
I am at a loss what to do. I need tomorrow vacated as [Ms ZZ] is on notice for some time I require a Defended in person hearing and I cannot get a response from my lawyers. I am too sick to get to Sydney at 10,30am tomorrow for the hearing. I have no one available to take me.
Can you pease treat this as my application to vacate tomorrows undefended hearing, and allow me enough time with the shocking health issues I am dealing with to have a Defended hearing in [City N]? I cannot produce an Affidavit in Reply quickly [due to a health issue] and finer tasks like world processing are very, very slow. I also only have energy for maximum 30-60 minutes before collapsing. I have had assistance typing this email this afternoon […]. Regards [Ms Nolan]
(As per the original)
In response, the applicant’s legal representatives emailed chambers on the same date, copying in the respondent’s legal representatives, indicating that they have not received any advice from the respondent’s legal representative that they no longer act for the respondent. The applicant’s legal representatives requested that the respondent and her legal representatives appear via Microsoft Teams.
The matter proceeded on 12 October 2023. There was no appearance by the respondent. The legal representative for the respondent, Ms AB, appeared and advised that she has not received any instructions from the respondent. Ms AB sought leave to withdraw and she was excused. I made the following directions:
1.The applicant file and serve written submissions in respect of costs on or before 4.00 pm on 26 October 2023.
2.The respondent file and serve any written submissions in respect of costs upon which she wishes to rely on or before 4.00 pm on 9 November 2023.
3.In the event that the applicant wishes to file written submissions in reply, such submissions are to be filed on or before 4.00 pm on 16 November 2023 at which time the matter will be reserved.
4.The applicant’s costs of and incidental to today’s mention are reserved for determination when considering the application for costs.
On 18 October 2023, a Senior Judicial Registrar sent a letter to the respondent advising that her legal representative had informed the court she no longer had instructions and was excused and provided a copy of the directions I made.
On 24 October 2023, my chambers received correspondence on behalf of the respondent from Ms NN, advising of the respondent’s “recent hospital admission and request for an extension of her Affidavit which she understands is due on 26 October 2023”. The respondent was misconceived in thinking she was required to file and serve any document on 26 October 2023. That deadline was for the applicant whereas the respondent’s deadline was 9 November 2023.
On 25 October 2023, further correspondence was emailed to my chambers from Ms NN, detailing the respondent’s health complications, requesting that the respondent be classified as a vulnerable person and requesting that the matter be adjourned until early 2024.
On even date, my Associate sent the following email to the parties and their practitioners (copying in Ms NN):
I refer to the correspondence received by chambers from [Ms NN] on 24 and 25 October 2023 which the solicitors for the Applicant were copied into.
Although most unorthodox given the informal application to adjourn, her Honour has considered the circumstances of the matter and proposes to, upon the court’s own motion, adjourn the matter subject to hearing from the Applicant and their attitude to same. In this event, the matter would be listed for mention at 2.15 pm on 16 January 2024 by Microsoft Teams.
Effectively I granted the respondent’s request for an adjournment.
The applicant filed written submissions in respect of costs on 26 October 2023.
On 7 November 2023 I made the following order in chambers:
1.The matter is adjourned for mention on 16 January 2024 at 2.15 pm at which time the Court will make a final timetable for the completion of Costs proceedings.
On 16 January 2024 at 10.48 am, my Associate received the following email from the address …@...:
Dear Associate,
I am contacting you on behalf of [Ms Nolan]. I am helping her as her next of kin [Ms NN] has been unwell and is living overseas. She will not be back in Australia till April 2024. I emailed [Ms Bauer’s] solicitor early this morning but have not yet received a response.
[Ms Nolan] has been moved back to her huse [sic] to be cared for there. She had four bouts of [serious illness] in 2023 including 4 hospitalisations and extended periods with [at home care]. I think it was around 3 months of admissions in 2023. In [late] 2023 she was hospitalised […]. [Ms Nolan] has been unable to walk without assistance since and was not able to [sic] be care for herself at home. In [late 2023] she attempted to move without assistance and had another bad fall. She then caught Covid.
[Ms Nolan] said she had a meeting online with you at 2,15pm today. I am trying to set her up in bed to deal with this before I leave for today. Unfortunately [Ms ZZ] has not been able to respond to my email asking her for the number to use to dial in at 2.15pm.
Could you email me the number for the 2.15pk[sic] conference?
Thank you
[Ms AC]
(As per the original)
The nature of the email is suggestive that the author, Ms AC, is a carer of the respondent.
Upon receipt, my Associate sent an email in reply copying in the applicant advising that leave will be given to appear via Microsoft Teams provided there was no objection from the applicant. The applicant’s legal representative advised that they were unaware of the email until it was forwarded by my Associate and that there was no objection to Ms Nolan appearing remotely. A Microsoft Teams link was forwarded to the respondent.
The matter was mentioned at 2.15 pm and there was no appearance by the respondent notwithstanding the MS Teams link having been provided. I made the following direction:
152.That the respondent file any submissions in response to the applicant’s submissions on costs by 4.00 pm on 6 February 2024 at which time judgment will be reserved to chambers.
The direction was provided to both parties by email.
No submissions were received from the respondent.
I have set out the lengthy history to explain why the application is now being determined on an undefended basis.
THE LAW
Section 117 of the Act provides in part:
(1)Subject to subsection (2), subsections 45A(6) and 70NFB(1) and sections 117AA and 117AC, 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), (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.
Note 1: For other provisions about the award of costs by the Federal Circuit and Family Court of Australia (Division 1), see paragraphs 69(4)(d) and (e) of the Federal Circuit and Family Court of Australia Act 2021.
Note 2: For other provisions about the award of costs by the Federal Circuit and Family Court of Australia (Division 2), see paragraphs 192(4)(d) and (e) of the Federal Circuit and Family Court of Australia Act 2021.
(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 applicant seeks indemnity costs either in respect of the whole of the proceedings or in respect of various Applications in a Proceeding or specific periods within the litigation.
In D & D (Costs) (No 2) (2010) FLC 93-435 the Full Court of the Family Court of Australia said:
27. The Court in Limousin (supra) also referred to the judgment of Shephard J in Colgate-Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248 upon which learned Counsel for the Wife relies in support of the present application. Shephard J said in Colgate-Palmolive (supra) (at 256):
“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 …
…
28. Reference was made to the later decision of the Full Court of Yunghanns v Yunghanns (2000) FLC 93‑029 in which it was said (at 87,471, par 31):
“It will suffice to say that the categories of circumstances which enliven the discretion to award indemnity costs are not closed, and that it is not a condition precedent to the exercise of the discretion that some collateral purpose or species of fraud be established against the party against whom such an order is sought.”
29. As was the case in Limousin (supra), the following passage from the Judgment of Shephard J in Colgate-Palmolive (supra) is instructive (at 257):
“… 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 Kent (SC(NSW)(CA), 27 Sept 1993, unreported) and an award of costs on an indemnity basis against a contemnor (eg Megarry V-C in EMI Records).”
(Emphasis added)
In Bant & Clayton (Costs) (2016) 56 Fam LR 31 the Full Court referred to these passages and concluded that to depart from the ordinary rule of calculating costs on a party/party basis, exceptional circumstances needed to be demonstrated and even the existence of exceptional circumstances did not oblige a court to make an order for indemnity costs.
CONSIDERATION
The applicant submits that there are justifying circumstances such as would see a departure from the usual rule. I am aware, even though the proceedings are undefended, that the respondent opposes the making of an order for costs.
Financial position of parties
The applicant submitted that the parties’ respective financial positions were a factor supporting the making of a costs order in the applicant’s favour. The parties are both retired and received substantial property as a consequence of the final orders of the Court. The applicant says there is a relevant distinction in their financial positions which arises from the manner in which they each funded their legal expenses. I accept that the applicant borrowed while the respondent met them from capital but this factor was figured into the adjustment of the assets and hence does not, without more, persuade me of justifying circumstances for the purpose of s 117(2A)(a) of the Act.
Conduct
The conduct of the parties to the proceedings is also a matter which was relied upon by the applicant in support of the application for costs. There is merit in this submission.
The Initiating Application was filed on 9 September 2019. Procedural orders were made on 18 November 2019, 18 February 2020 and 29 April 2020. A plain reading of those orders permits the conclusion that the respondent to the Initiating Application did not comply with the Court’s directions.
On 21 May 2020, the matter was set down for an undefended hearing in circumstances where the respondent had failed to file any material. On 24 July 2020 the respondent filed a Response disputing the existence of a de facto relationship and seeking a jurisdictional threshold hearing.
The matter was transferred to the Federal Circuit and Family Court of Australia (Division 1) and listed for hearing in respect of the threshold issue for five days commencing 21 February 2022. The applicant complied with the filing directions and also sought expedition of the final hearing dates which was granted.
On 10 November 2021, Altobelli J made orders including an injunction restraining the respondent from dealing with the proceeds of sale of a property which she owned in Suburb U and orders in respect of disclosure. The applicant says that the orders for disclosure were not complied with.
On 27 January 2022, the applicant received leave to issue subpoenas in respect of the upcoming threshold issue.
On 14 February 2022 the parties asked the Court to make consent orders the effect of which was that the respondent conceded that there was jurisdiction to hear and determine an application for property adjustment arising out of the breakdown of the parties’ de facto relationship. The applicant’s costs were reserved.
A significant basis upon which the applicant relies in support of her application for costs was the necessity to engage in the litigation concerning the threshold issue in circumstances where the respondent denied that the parties were in a de facto relationship.
As discussed above, leave was granted to issue subpoena both in respect of financial records but perhaps more importantly in this context in respect of medical and health insurance records on the basis contended by the applicant that those records would demonstrate that the nature of the relationship between the parties satisfied the statutory definition of a de facto relationship. Following the grant of leave for the subpoenas to issue, documents were produced and the threshold matter resolved.
The documents sought by subpoena were plainly relevant. I made the following finding in my reasons for judgement at [125]:
The applicant was diagnosed with [an illness] in […] 2016. When she was admitted to hospital the applicant recorded her next of kin as the respondent and described her relationship as “partner”.
In the same vein the respondent represented to the parties’ accountant:
[Ms Bauer], my life partner, also has some CGT credits from sale of our joint former business. In the event that my CGT credit falls short could I apply her CGT credits against my CGT liability if she consented or is that not allowed? [Transcript 10.11.22, p342 lines 1-3]
I accept that the respondent’s conduct in requiring the issue of the existence or otherwise of the de facto relationship to be the subject of directions for a threshold hearing, albeit that it was ultimately resolved by consent, is a relevant factor in considering the applicant’s costs application.
In respect of that aspect of the litigation, it would be accurate to say that the respondent was “wholly unsuccessful”.
The respondent failed to comply with an order made 21 May 2020 to file a financial statement. She did not file a financial statement until 20 October 2022.
Offers of settlement
The final property adjustment orders divided the parties’ property as follows [148]-[152]:
148. I note that the parties agree that the following assets or financial resources will remain with the applicant:
(a) The [Suburb S] property $2,630,000;
(b) [Motor Vehicle 1] $19,000
(c) [Motor Vehicle 2] $15,000
(d) Shares in [H Insurance] and [HH Company] $26,493
(e) Cash $950
(f) Inheritance from [Ms Y] $30,000
(g) Entitlement to pension in the present sum of $1,558 per week
The assets total: $2,721,443.
149.I note that the parties agree that the following assets will remain with the Respondent:
(a) The [Suburb Q] property $1,450,000
(b) The [Town W] property $50,000
(c) An ANZ Bank account ending [#...74] $78,735
(d) Shares $233, 489
(e) [Motor Vehicle 3] $49,700
(f) Cash $32,250
(g) [TT Bank] account (interest in Estate of [Ms JJ]) $170,988
(h) Paid legal fees $709,591
(i) Superannuation with [Super Funds 1, 2 and 3] $971,650
The assets and superannuation total $3,746,403
150. The total net pool of assets and superannuation is $6,467,846.
151.Having determined that the contribution based entitlements of the parties were equal it is necessary, having regard to the various factors in s 90SF(3) of the Act and findings set out above to weigh whether a further adjustment is appropriate. In the circumstances of this case I find that the factors which favour the applicant (in particular the unexplained [Suburb U] proceeds) are offset by those which are relevant to the respondent (specifically, the applicant’s significant superannuation income and better health) and determine that no further adjustment is appropriate in this case.
152.Having determined that the net pool should be divided equally it follows that in order to do justice and equity as between the parties the respondent will make a payment to the applicant in the sum of $512,480.
Against that conclusion, I must weigh the various offers which were made to resolve the proceedings.
The first offer was made by the applicant prior to filing. It was framed as an offer to resolve a business partnership dispute in respect of the partnership operated by applicant and respondent between 2002 and 2016 and was not explicitly an offer which (at this stage) was made in reference to the parties’ de facto relationship. It is not plain that had this offer been accepted then that would have prevented the litigation which was ultimately focused on the financial arrangements during the parties’ relationship (including the partnership).
The applicant made an offer of settlement on 18 November 2022 seeking that the respondent pay her $600,000. Significantly, that offer also proposed that each party pay her own costs. Given that my orders provided the respondent pay the applicant $512,480 then there is some force in the submission that acceptance of that offer would have placed the respondent in a better position. The respondent had paid legal fees of $709,591 at the time of hearing. The hearing itself occupied 8 days during which the respondent had solicitor and counsel. While I am unable to say precisely how much the respondent would have saved had she accepted the offer I can confidently conclude that she would have been in a better position.
Offer in respect of threshold issue
The initial stages of the dispute focused on the threshold issue. On 5 February 2021 the applicant offered to resolve the threshold issue by a concession with the issue of costs reserved. On 14 February 2022 the threshold issue resolved by consent with costs reserved. In effect, the respondent accepted the applicant’s offer.
Offer in respect of Application in a Proceeding seeking injunctions
On 23 July 2021 the applicant sought that the respondent enter into consent orders in respect of injunctions which would have the effect of restraining the respondent from disposing or dissipating funds other than on ordinary living expenses. The respondent did not agree and the Court made orders in accordance with the applicant’s proposal. This occurred against a backdrop where the respondent had withdrawn two bank cheques and held them: see Bauer & Nolan (No 4) [2023] FedCFamC1F 598 [39] – [40].
The applicant seeks indemnity costs globally and, in the alternative, identifies particular applications and periods of time during the litigation in which she seeks indemnity costs.
In the event that I am not persuaded to make indemnity costs orders either globally or in respect of a particular event, the applicant seeks costs at scale or as agreed or seeks that I use the discretion which is conferred by r 12.17 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) to set the amount of costs payable.
As discussed above, indemnity costs will only be payable in exceptional circumstances so the question arises as to whether this case is one where the circumstances are exceptional either in respect of the whole costs or some part of the costs incurred.
I accept that this is a case where it is appropriate to make a costs order in favour of the applicant for the reasons discussed above.
I propose to deal with the various periods/applications as opposed to making a global determination.
September 2019 to February 2022
The applicant commenced proceedings in September 2019 and in February 2022 the parties filed consent orders containing a declaration that the parties had been in a de facto relationship. The applicant entered into a costs agreement with her solicitors in August 2019 – a copy of which is in evidence.
I find that there are exceptional circumstances in respect of the period from filing to settlement of the threshold issue. I find that it was disingenuous of the respondent to deny a de facto relationship to this Court in circumstances where she had represented to the parties’ health insurance provider, accountants and health professionals that the parties were a couple. This denial caused delay and was productive of unnecessary cost. This seems squarely a “wilful disregard of known facts”: Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397. During this period the respondent also failed to comply with directions, failed to file a financial statement as ordered, failed to engage with the proceedings leading to the matter being set down on an undefended basis and failed to provide disclosure in respect of the proceeds of sale of a property she had sold.
The costs which the applicant seeks referable to that period are $122,170.21 and I will order the costs in that amount (rounded down), that include costs in respect of the hearing on 30 August 2021 and the subpoena objection hearing on 10 February 2022 together with the costs of issue of subpoenae.
18 November 2022 to 20 July 2023
Otherwise, while I accept that the applicant has persuaded me to depart from the usual rule that each party pay her own costs, I am not persuaded that the balance of the costs should be payable on an indemnity basis.
The offer of settlement 18 November 2022 would have required a payment to the applicant of about $88,000 more than I ultimately ordered. This offer was made absent proper disclosure and it would have been commercially sensible for the respondent to accept it.
I accept that the offer of settlement made 18 November 2022, if accepted, would have led to both parties saving legal fees and each being in a better financial position.
I accept that, having regard to the relief which the respondent sought, she was wholly unsuccessful.
Accordingly, I propose to order that the respondent pay the applicant’s costs from the date of the offer to the conclusion of the proceedings in a fixed sum, as permitted by r 12.17 of the Rules. The amount referable to that period calculated on an indemnity basis is $165,791.44.
That amount is said to be comprised as follows:
(a)$62,408.63 invoiced by the applicant’s solicitors;
(b)$75,295 invoiced by the applicant’s barrister ; and
(c)$28,087.81 incurred from expert evidence.
I cannot be confident that the expert fees were unavoidable, nor can I be satisfied on the evidence before me that the whole of the barrister’s fees, while potentially paid after 18 November 2022, did not include fees incurred during the hearing on 7-11 November 2022. Doing the best I can with the evidence, I form the view that the respondent should meet half the claimed costs, which is $83,000 rounded to the nearest thousand.
His Honour Kent J in Stoian & Fiening (Costs) [2014] FamCA 944 at [90]-[91] cited, with approval, the dicta of Einstein J in Idoport Pty Ltd v National Australia Bank & Ors [2007] NSWSC 23 at [9] where his Honour, in applying a provision analogous with r 12.17 of the Rules, identified as an advantage of the fixing of a sum for costs the avoidance of the delays and costs occasioned by taxation. That has particular importance in this case which has already experienced significant cost and delay.
I have separately considered the claim for costs thrown away in respect of the adjourned hearing (13 and 14 February 2023) but I am not satisfied that the circumstances in which the hearing was adjourned (incapacity on the part of the respondent) are such that I could comfortably depart from the usual rule.
Finally, I accept that these costs proceedings have been extenuated (with resulting costs to the applicant) due to multiple adjournments granted in an effort to provide the respondent with an opportunity to be heard. Again I find that it would be appropriate to fix the sum of costs payable in respect of the costs application itself and do so in the fixed sum of $10,000 which takes into account multiple court attendances, the preparation of the application, affidavit and written submissions and the involvement of counsel.
I certify that the preceding sixty-four (64) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Christie. Associate:
Dated: 15 February 2024
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