Bemert and Swallow (No 2)

[2009] FamCA 708

FAMILY COURT OF AUSTRALIA

BEMERT & SWALLOW (NO. 2) [2009] FamCA 708

FAMILY LAW – COSTS – Circumstances justifying order – Evidence of financial circumstances – Conduct of the parties in relation to the proceedings – False allegation or statement made by a party in the proceedings – Discretion of the Court

Family Law Act 1975 (Cth)

APPLICANTS: Mr and Mrs Swallow 

RESPONDENTS: Mr Bemert;
Mr and Mrs Bemert (Snr)

FILE NUMBERS: SYC 959 of 2008

DATE DELIVERED: 6 August 2009

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Watts J

HEARING DATE: 20 May 2009

REPRESENTATION

SOLICITOR FOR THE APPLICANTS: Barkus Doolan Kelly

SOLICITOR FOR THE RESPONDENTS: Self represented

Orders

1. Mr Bemert pay to Mrs Swallow and Mr Swallow (or to any person they nominate in writing) an amount of $12,000 by way of costs within a period of 28 days.

2. Mr and Mrs Bemert (Snr) pay to Mrs Swallow and Mr Swallow (or to any person they nominate in writing) an amount of $4,000 by way of costs within a period of 28 days.

IT IS NOTED that publication of this judgment under the pseudonym Bemert & Swallow is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBERS: SYC 959 of 2008

MRR AND MR SWALLOW

Applicants

And

MR BEMERT; MR AND MRS BEMERT (SNR)

Respondents

REASONS FOR JUDGMENT

INTRODUCTION

1. The applicants, Mrs and Mr Swallow, filed an Application in a Case on 12 February 2009 for the first respondent (as to 75 per cent) and the second and third respondents (as to 25 per cent) to pay the costs of and incidental to these proceedings in an amount to be either fixed by the Court, or as agreed or assessed. 

2. That Application sought further directions in relation to the filing of documents, including written submissions and for the matter to be determined in chambers.

3. The matter was listed in Court for mention before me and directions were made in relation to the filing of written submissions. 

4. On 2 March 2009 a direction was made that this Application be stood over to a date to be fixed after written submissions were received. 

5. Both the parties were informed by letter written by my Associate and addressed to their respective addresses for service (the respondent’s address being …) of the listing date of 20 May 2009.  That listing was to give the parties an opportunity, if they so desired, to make further oral submissions. 

6. On 20 May 2009 Mr Doolan appeared on behalf of the applicants and with Mr Swallow.  There was no appearance by any of the respondents. 

7. I indicated that I had the material referred to in paragraph 1.4 of the applicants’ submissions and that I had all the material referred to in paragraph 4 of the respondents’ submissions as to costs, apart from the item referred to at paragraph 4.11 (complaint against Watts J to the Chief Justice of the Family Court of Australia by Mr Bemert dated 4.9.2008).  Given that Mr Bemert did not appear on 20 May 2009 I have decided this costs application without having that document available to me.

8. I delivered reasons for judgment in the substantive matter on 15 January 2009 and made orders in accordance with those reasons.

9. The applicants in this application were successful in obtaining the relief that they sought in the substantive proceedings and they now seek an order for costs in respect of these proceedings on a party and party basis. 

10. The orders made on 15 January 2009 summarily dismissed the application of Mr Bemert filed 20 February 2008 and the application filed by Mr and Mrs Bemert (Snr) on 1 July 2008. An order was made pursuant to s 118(1)(c) of the Family Law Act 1975 (“FLA”) against Mr Bemert. In the event that the orders for summary dismissal were set aside by the Full Court, I ordered that Mr Bemert provide security for costs in the sum of $50,000 and that Mr and Mrs Bemert (Snr) provide security for costs in the sum of $25,000.

RELEVANT LEGISLATION

1. In their written submissions, the applicants rely upon s 117 FLA and the matters arising for consideration pursuant to s 117(2A) FLA; s 118(1)(b) FLA and s 117AB FLA.

2. The starting point under s 117(1) FLA is that each party to proceedings under the FLA will bear his or her own costs.

3. Section 117(2) FLA provides that if there are circumstances to justify it and subject to other subsections of s 117 FLA, the Court may make such order as to costs as it considers just.

4. Section 117(2A) FLA provides that when considering what order, if any, should be made under s 117(2A) FLA the matters enumerated in subparagraph (2A) need to be taken into account.

5. The effect of s 117 FLA is that although the primary rule is that each party bears their own costs, the Court has a broad discretion to exercise while having regard to the circumstances of the individual case, guided by the matters set out in s 117(2A) FLA.

6. The applicants also make an application under s 118(1)(b) FLA. Under that section the Court is to make a costs order as it considers just. There is no presumption or starting point that each party will bear their own costs and the general rule in s 117(1) FLA is expressly stated to be subject to s 118 FLA.

7. In addition, the applicants make an application relying upon s 117AB FLA. That section provides that where a court is satisfied that a party knowingly made a false statement in proceedings, the court must order that the party pay some or all of the costs. Again, s 117(1) FLA is expressed to be subject to s 117AB FLA.

Relevant matters under s 117(2A) FLA

1. This subsection lists seven factors to which the Court shall have regard when making a determination as to what costs order, if any, is just. 

2. The applicants refer to a passage from Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish & Another (2005) 33 Fam LR 123 where the Full Court (Kay, Warnick & Boland JJ) said at page 130:-

   “41. ....

   The financial circumstances of each of the parties to the proceedings is the first mentioned factor. Nowhere in subsection (2A) or elsewhere in section 117, is there any prescription that more than one factor must be present before an order for costs is made nor of comparative weight of the factors set out in subsection (2A). As a consequence, there is nothing to prevent any factor being the sole foundation for an order for costs.”

3. The point of drawing that authority to my attention is to support a contention that in the circumstances of this case the fact that the applicants have chosen to present their costs case in a certain way should not lead to a result that their application for costs should fail. 

4. The applicants have deliberately chosen not to place before the Court details of their financial circumstances, except in a very limited way. 

5. I will now deal with the detail of that argument which is the first matter that I have to deal with when considering the matters set out in s 117(2A) FLA, which I now do in turn.

Section 117(2A)(a) FLA

1. Evidence in relation to the financial circumstances of the applicant is firstly to be found in paragraph 3 of the affidavit of Mr Swallow sworn 13 March 2009.

2. That paragraph is in the following terms:-

   “Neither myself nor my wife, [Mrs Swallow], intends to place evidence before the court as to our financial circumstances, other than to say as follows:-

   (a)I am in full time employment […];

   (b)My wife, [Mrs Swallow], is not in paid employment and is a full time home maker and parent to our children;

   (c)We entered into costs agreements with each, firstly Slater & Gordon, and then Barkus Edwards Doolan.  We have to date paid Barkus Edwards Doolan costs and disbursements totalling $22,795.31;

   (d)We paid Slater & Gordon costs and disbursements totalling $19,388.  We have no outstanding fees to Slater & Gordon.

3. The applicants also rely upon paragraph 38 of an affidavit of Mrs Swallow filed in the Family Court of Australia on 12 May 2008.  That affidavit was part of the material before me in the substantive hearing.  In that paragraph, Mrs Swallow confirms that she is the primary care giver of four young children and asserts that she is not able to undertake paid employment and that her husband, Mr Swallow, is the sole income provider.  She also estimated that the costs of obtaining an Apprehended Violence Order (“AVO”) for her family’s protection and defending her father’s application were in the sum of $14,000 as at May 2008. 

4. Pausing there, I infer that the majority of the costs incurred as referred to in paragraph 38 of Mrs Swallow’s affidavit of 12 May 2008 were costs incurred in relation to the AVO proceedings.

5. In the material relied upon by the respondents in this application, no new evidence was provided in respect of their financial circumstances.  I deal with Mr Bemert’s financial means at paragraphs 177 to 180 of my reasons for judgment dated 15 January 2009 (“my reasons for judgment”) and I deal with the financial position of Mr and Mrs Bemert (Snr) at paragraphs 236 and 237 of those reasons. 

6. It is indicated at paragraph 6(b) of the submissions made by the respondents that the three respondents are Centrelink beneficiaries.  At paragraph 7(a)(ii) there is an assertion that Mrs Swallow has an inheritance which she has failed to disclose which gives her access to many millions of dollars, with her having ready access to “the late […] Estate”.  At paragraph 8/3.1.2(a) the submissions from the respondents again assert that Mrs Swallow has access to a vast monetary inheritance.

7. These are bald assertions.  I have no evidence whatsoever to indicate that they are true.  The sworn evidence I have from Mrs Swallow is that Mr Swallow provides the sole source of income for her family and that she does not earn a separate income.

8. The evidence of the respective financial circumstances of all of the parties in these proceedings is less than satisfactory.

9. The applicants have adopted a deliberate course of choosing not to make a complete disclosure in relation to their financial circumstances.

10. Given the overall circumstances of this case as more fully described in my reasons for judgment, one can readily understand why it might be that Mr Swallow and Mrs Swallow are extremely reluctant to publish information, particularly to Mr Bemert, about their financial circumstances.

11. I do, however, have to assume for the purposes of these proceedings, given the forensic attitude taken by Mrs and Mr Swallow (for whatever reason), that they do have the ability to fund the litigation that has taken place to date.

12. Equally, I am unable to say that the respondents do not have the ability to pay a costs order (because I do not know fully what their financial circumstances are and in particular what their assets are).

13. Given that both parties have chosen only to provide scant details in respect of their financial circumstances, this is not a matter upon which I place any great weight in making the decision that I have to make in this costs application.

14. Even if I were to assume that there was a substantial financial imbalance in favour of Mrs and Mr Swallow, the other factors which I will shortly discuss are so weighty as to mean that a costs order would in any event be appropriate.

Section 117(2A)(b) FLA

1. There is no evidence before me that any of the parties in these proceedings were in receipt of Legal Aid assistance.  The respondents in their submissions indicate that they made an application for Legal Aid which was unsuccessful but I have no evidence about that.

Section 117(2A)(c) FLA

1. In determining this application, I place considerable weight on the conduct of each of the respondents in relation to the proceedings in determining that an order for costs is justified in the circumstances of this case.

2. As set out in my reasons for judgment, I said it seemed beyond doubt that Mr Bemert is significantly obsessional about litigation and his involvement in court cases (paragraph 52).  There was a delay of ten years in any application to spend time with the children or to have any communication with them that led to a situation where there was then no attachment at all between Mr Bemert, Mr and Mrs Bemert (Snr) on the one hand and any of the children on the other (paragraphs 134 and 135).  I found that part of what triggered the application, and certainly part of what continues to motivate it, is Mr Bemert’s desire for orders from this Court which would be inconsistent with and therefore neutralise the AVO against him.  I found that the timing of Mr Bemert’s application was largely a reaction to the result in the AVO proceedings (paragraph 136 of the judgment). 

3. I referred to the letter written by Mr Bemert on 6 May 2008 which sets out the financial, emotional and punitive impact that Mr Bemert expected these proceedings to have on Mrs and Mr Swallow and consequently on the children.  Another letter which is attached to Mr Swallow’s affidavit of 13 March 2009 (annexure A) is a letter written by Mr Bemert on 11 February 2009.  The tone of that letter is condescending but reiterates Mr Bemert’s previous estimate that he expects this litigation in the Family Court of Australia to be protracted and costly and put the applicants to significant costs, which are estimated by Mr Bemert to be about $500,000. 

4. I concluded that the litigation by Mr Bemert was without any realistic prospect of success and that Mr Bemert’s application was so clearly untenable that his application could not possibly succeed (paragraphs 143(d) and 145). 

5. I accepted the proposition that the institution of proceedings by Mr Bemert created an oppressive and cruel impact upon Mrs and Mr Swallow’s family unit (paragraph 153). 

6. I found that irrespective of motive, Mr Bemert’s application was so obviously untenable and manifestly groundless as to be utterly hopeless. In the alternative I found that Mr Bemert’s motivation for filing his application was for the collateral purpose of having the AVO effectively set aside (paragraph 200).

7. In relation to Mr and Mrs Bemert (Snr)’s application, I found that there had been no meaningful contact for a period of about ten years with any of the children and no contact at all with three out of the four children.

8. I found that Mr Bemert had a substantial involvement in the preparation of the written material provided to the Court by his parents, Mr and Mrs Bemert (Snr).  That finding is reinforced by a concession made in the submissions by the respondents that Mr Bemert did have a substantial involvement in the preparation of the written material provided to the Court because his mother was not computer literate and cannot type and his father does not have the experience with the courts or in family law to be able to prepare his own documentation.

9. I went on to find that Mr and Mrs Bemert (Snr) did not have standing to press their application (paragraph 219).

10. I found there was no satisfactory explanation in the affidavits of Mr and Mrs Bemert (Snr) as to why it was that no steps had been taken in a ten year period to do anything about making an application for them to see any of their great-grandchildren (paragraph 229).

11. I found that it was a reasonable inference that the timing of the applications made by Mr and Mrs Bemert (Snr) had been occasioned by the application that had been made by Mr Bemert and was significantly connected to Mr Bemert’s application (paragraph 232).

12. The conduct of the respondents in relation to the costs application weighs in favour of a cost order being made. 

Section 117(2A)(d) FLA

1. All parties agree that this is not a relevant matter to which I need have regard. 

Section 117(2A)(e) FLA

1. I find that each of the respondents has been wholly unsuccessful.  The orders applied for by Mr and Mrs Swallow were granted and it was noted in the reasons for judgment that other orders would have been granted had the primary applications made by Mrs and Mr Swallow been unsuccessful.  Certain legal submissions pressed by Mr and Mrs Swallow were not accepted by me but ultimately that had no affect on the outcome which can be categorised as the respondents being “wholly unsuccessful”.

Section 117(2A)(f) FLA

1. There is no evidence before me that there was any relevant offer made in writing.

Section 117(2A)(g) FLA

1. An order was made in this case for summary dismissal of the applications made by the respondents and in addition an order was made against Mr Bemert pursuant to the provisions of s 118 FLA. Mrs and Mr Swallow have at all times had an absolute opposition to any form of direct or indirect contact between the children and Mr Bemert, Mr and Mrs Bemert (Snr) and/or any other members of Mr Bemert’s extended family. Knowing that, the respondents continued with the proceedings, notwithstanding it was not in the best interests of any of the children for that to happen.

Section 118(1)(b) FLA

1. This section is relied upon by Mr and Mrs Swallow as against Mr bemert only. It provides that if a Court is satisfied that proceedings are frivolous or vexatious (as I have been satisfied in this case), the Court may make such order as to costs as the Court considers just. Had I not found that it was appropriate to make an order against Mr Bemert pursuant to the provisions of s 117(2) FLA, I would have made an order under s 118(1)(b) FLA. Under s 118(1)(b) FLA, there is no mandatory requirement to consider the respective financial circumstances of each of the parties. In the event that my conclusions in relation to s 117(2A)(a) FLA are incorrect, then I find, in the alternative, that the order that I make against Mr Bemert is also a just order pursuant to the provisions of s 118(1)(b) FLA.

Section 117AB FLA

1. This section applies if the Court is satisfied that a party to the proceedings knowingly made a false allegation or statement in the proceedings.

2. Again, this is a submission made by the applicants against Mr Bemert.  They rely upon paragraphs 74 to 79 of my reasons for judgment where I have concluded (at paragraph 79) that it can be readily seen that Mr Bemert misrepresented what happened in the High Court of Australia in 1983.  I found that the assertion made by Mr bemert, on two occasions on his oath, that Justice Nygh was thrown out of the proceedings appears factually inaccurate.  In the respondents’ submissions on page 3, paragraph 6(c)(ii), Mr Bemert concedes that he erred in swearing that “the late Justice Nygh had been thrown out by Brennan J of the High Court”.  Mr Bemert goes on to make another representation that Justice Nygh had resigned after he had been:

   “..exposed as having perpetrated his wilful misadministration of justice in the [sic] [Bemert v Bemert] and caused harm to the welfare of both the [Bemert] daughters wherein legal action had been instituted against the corrupt late Professor Nygh in the High Court that led the late Professor Nygh to dismiss himself from further hearings of the matter, after he had perpetrated knowingly the misadministration of justice that caused harm to the children”

3. At page 10, Mr Bemert asserts “the misrepresentation in the High Court had no material relevance to this [sic] proceedings and was simply an error of memory as to the exact events of more than a quarter of a century ago”. 

4. I have no evidence that Mr Bemert’s new version is any more accurate than his first account.

5. I did not, however, in the context of my judgment at paragraph 79 make a finding that the false statement made by Mr Bemert was “knowingly” made, notwithstanding the high level of experience and intelligence Mr Bemert brings to the preparation of documents in these proceedings. I am unable to be certain, without Mr Bemert being tested, as to whether or not his original false assertions made against the late Justice Nygh were made knowingly by him. Consequently, there is no mandatory requirement for me to make a costs order against Mr Bemert pursuant to the provisions of s 117AB(2) FLA.

FORM OF ORDER

1. Having considered the relevant matters under s 117(2) FLA (and alternatively in relation to Mr Bemert the provision of s 118(1)(b) FLA), I find that it would be just for a costs order to be made against the respondents in these proceedings.

2. The Family Law Rules 2004 allow me to order a specific amount of costs.

3. Mr Bemert has been found to be a vexatious litigant.  Mr and Mrs Bemert (Snr) have been found to have no standing to bring the application that they sought to bring.  Given the findings I have made in this matter, I conclude that there should be as little scope as possible for further argument or dispute about assessments and accordingly I conclude that it is appropriate in this case to make an order for costs in a specific amount.

4. In order to reach a determination in relation to a specific amount which is just, I take into account the following. 

5. Firstly, I consider the evidence given by Mr and Mrs Swallow about costs incurred to date.  Mr Swallow’s evidence is that he and Mrs Swallow paid Slater & Gordon costs and disbursements totalling $19,388.  However, Mrs Swallow’s evidence is that $14,000 had been paid to Slater & Gordon as at 12 May 2008 (and I have already noted that most of that I infer was incurred in respect of the defended AVO proceedings).  I think it would be safe to assume, given the progress of the proceedings before me as at 12 May 2008, that $9,000 of the $19,388 paid to Slater & Gordon related to these proceedings.  I conclude that the whole of the amount of $22,795 paid to Barkus Edwards Doolan relates to these proceedings.  Although the applicants originally made an application for indemnity costs, that application was amended for party/party costs.

6. I have no evidence as to whether or not Slater & Gordon and Barkus Edwards Doolan (as they then were) were charging Mrs and Mr Swallow in accordance with the Family Court scale or under some private costs agreement.  I would infer that the charges were then made under a costs agreement and that in round terms, Mrs and Mr Swallow have expended about $30,000 on the proceedings before me on a solicitor/client basis.

7. The main thing to which I have regard when assessing costs in this matter is my knowledge of the procedural history of the matter, including appearances before me, and the voluminous documents relied upon by the respondents and the documents relied upon by Mrs and Mr Swallow as detailed in paragraphs 14 through 19 of my reasons for judgment.

8. I conclude that it would be reasonable on a party/party basis to assess that Mrs and Mr Swallow would have been charged in accordance with the Family Court scale an amount of $16,000.

9. I accept that it is appropriate in this case that that assessment as to costs should be payable as to 75 per cent by Mr Bemert ($12,000) and 25 per cent by Mr and Mrs Bemert (Snr) ($4,000).  That payment should be made within 28 days.

I certify that the preceding sixty-eight (68) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Watts.

Associate: 

Date: 6 August 2009