Benson & Drury (No 2)

[2023] FedCFamC1F 155

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 1)

Benson & Drury (No 2) [2023] FedCFamC1F 155

File number(s):

MLC 8683 of 2022

Judgment of:

BERMAN J

Date of judgment:

16 March 2023

Catchwords:

FAMILY LAW – PRACTICE AND PROCEDURE – COSTS – where the parties agree for the matter to be determined on the papers – Where the mother seeks costs in relation to the father’s dismissed Initiating Application – Where following the dismissal, orders were made pursuant to s102QB of the Act prohibiting the father from instituting further parenting proceedings without leave – Where findings were made that the father is vexatious in his conduct – Where the mother seeks costs on an indemnity basis – Consideration of whether the costs should be payable on an indemnity basis or a party/party basis – Consideration of quantum – Orders made

Legislation:

Family Law Act 1975 (Cth) s 117(2A)

Cases cited:

Benson & Drury [2022] FedCFamC1F 1041

Prantage & Prantage (2013) FLC 93-544

Re Wilcox; Ex parte Venture Industries Pty Ltd and Ors (No 2) (1996) 72 FCR 151

Division:

Division 1 First Instance

Date of hearing:

Determined on the papers

Place:

Adelaide 

Solicitor for the Applicant:

The Applicant being self-represented

Solicitor for the Respondent:

D’Angelo Lawyers

ORDERS

MLC 8683 of 2022

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:

MR BENSON

Applicant

AND:

MS DRURY

Respondent

order made by:	BERMAN J
DATE OF ORDER:	16 March 2023

THE COURT ORDERS:

1.On or before sixty (60) days from the date of this order, Mr Benson (“the father”) do pay Ms Drury (“the mother”) the sum of TWENTY TWO THOUSAND THREE HUNDRED AND SIXTY THREE DOLLARS AND TWENTY FIVE CENTS ($22,363.25) on account of her costs incurred, into the D’Angelo Lawyers Law Practice Trust Account.

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 Benson & Drury has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

REASONS FOR JUDGMENT

BERMAN J

INTRODUCTION

1. Mr Benson (“the father”) and Ms Drury (“the mother”) are the parents of B born 2005 and C born 2008 (“the children”).

2. On 22 December 2022 the following Orders were made:

   1.Pursuant to s 102QB of the Family Law Act 1975 (Cth) (“the Act”), [the father] is prohibited from instituting further parenting proceedings under the Act in relation to [the children] without first having been granted leave to commence those proceedings pursuant to s 102QD of the Act, provided that the father does not require leave to file a Contravention Application in respect of Orders made 9 August 2017.

   2.        The Amended Initiating Application filed 12 October 2022 be dismissed.

3. Consequent upon the dismissal of the father’s Amended Initiating Application and the prohibition of the father from instituting further parenting proceedings without leave, by Application in a Proceeding sealed 16 January 2023, the mother seeks that the father pay her costs of and incidental to the interim proceedings either on an indemnity basis, in the sum of $22,363.23, or as an alternative, on a party/party basis calculated pursuant to the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Division 1), in the amount of $17,855.58.

4. The background to the proceedings is comprehensively set out in the judgment of Benson & Drury [2022] FedCFamC1F 1041, delivered 22 December 2022.

5. The Court determined that the father’s application was vexatious and that he was prepared to enter into unrelenting litigation.  The consequence of the ongoing litigation is reflected in the extent of the mother’s legal fees in excess of $200,000, the cumulative costs orders against the father in the sum of $100,000 and the very real potential for the litigation to have exacerbated the children’s mental health issues.

   MOTHER’S APPLICATION FOR COSTS

6. In considering what orders, if any, should be made in respect of the mother’s costs, s 117(2A) of the Family Law Act 1975 (Cth) (“the Act”), sets out that the Court shall have regard to the following:-

   (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, admission 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.

7. Accordingly, I have a wide discretion in respect of matters relating to the making of costs order.

8. The Orders made on 22 December 2022, dismissed the father’s Amended Initiating Application filed 12 October 2022. In that regard, the father has been wholly unsuccessful. Moreover, the mother was successful in seeking an order that the father be prohibited pursuant to s 102QB of the Act from instituting further parenting proceedings. The father’s opposition to him being declared a vexatious litigant was also wholly unsuccessful.

9. The very nature of the proceedings, resulting in a finding that the father is vexatious in his attitude towards the mother and the use of Court proceedings to pursue her relentlessly, is a relevant factor and should also be brought to account.

10. The mother seeks that if a costs order is made in her favour then it should be paid on an indemnity basis. 

    Legal principles

11. The discussion of the Full Court in Prantage & Prantage (2013) FLC 93-544 (“Prantage”), is of assistance in determining whether, and in what circumstances, an order for indemnity costs should be made.

12. The Full Court referred extensively to the decision of Kohan & Kohan (1993) FLC 92-340 in which it was noted that, whilst there was nothing in the Act which in any way “inhibits” a consideration of indemnity costs, the following is said at 79,605:-

    …it is fundamental to the exercise of that discretion in the Family Court that the Judge should not only understand that such an order is a very great departure from the normal standard, but also that the Judge should know what the terms of the agreement are, to what extent it exceeds the parameters set by the scale, and what its likely impact will be on the financial position of each of the parties.

    This impact was a relevant matter to which the trial Judge should have had regard, when considering the financial circumstances of each of the parties to the proceedings under sec 117(2A)(a), or perhaps even more as a relevant matter under (g). The degree to which a costs agreement departs from the established norm and the actual financial significance of such a departure may itself be a reason for not ordering costs on an indemnity basis.

13. In Re Wilcox; Ex parte Venture Industries Pty Ltd and Ors (No 2) (1996) 72 FCR 151, Cooper and Merkel JJ said:-

    156.The issue whether costs should be ordered on a party and party basis or on an indemnity basis has acquired increasingly greater significance as the gap between the two bases appears to have grown.

    The gap has highlighted the conflict between two seemingly irreconcilable objectives. The first is protecting access to justice by only exposing an unsuccessful litigant in the usual course to an order for scale costs on a party and party basis. The second is relieving a successful litigant from the burden of costs which that litigant should not have been required to incur. These and other policy factors have been considered by the courts over a very long period in order to arrive at the principles which govern the undoubted discretion of courts to depart from ordering costs on a party and party basis and ordering costs on an indemnity basis. The principles were stated by Sheppard J in Colgate-Palmolive Company v Cussons Pty Ltd. (1993) 46 FCR 225.

14. In Prantage (supra) the Full Court said at 87,209:-

    97. In our view, once it is recognised that ensuring access to justice is one of the key objectives of the “usual rule”, the claimed increasing disparity between scale costs and those being charged by lawyers becomes as much an argument against the awarding of indemnity costs as it is in favour of costs being ordered on that basis.

    98. With respect to the trial Judge, we are not convinced that there is a great deal of difference between current “commercial realities” and those prevailing at the time Kohan was decided. It should be noted that the costs agreement in Kohan provided for a rate of payment three times in excess of the scale. However, even if there have been changes in the market place for legal services, we are not persuaded this should have any impact on the application of the “usual rule”, which seeks to balance competing public policy considerations.

    (Emphasis per original)

15. I consider that the dismissal of an Amended Initiating Application and the success of an application to prohibit the father from instituting proceedings has a high level of complexity about it.  Moreover, the very nature of the proceedings is premised upon a finding that the father is vexatious in his conduct.

16. Given the history of the matter and the significant costs already incurred by the mother in meeting the various applications of the father, this would readily support a finding that costs should be assessed on an indemnity basis.

    QUANTUM OF THE MOTHER’S COSTS

17. I have given careful consideration to the mother’s Affidavit of 16 January 2023 and in particular, the annexures which set out the actual costs incurred and the terms of engagement entered into by the mother.

18. I am satisfied that the documents evidencing the fee structure for the mother’s solicitors, the terms of engagement and the fees incurred, are consistent and corroborative of the quantum of costs sought.

19. I am cognisant of the matters raised by the father in his affidavit of 19 February 2023 but do not consider that they in any way ameliorate the consequence of a finding that the father’s conduct was vexatious.

20. I am satisfied that the costs sought by the mother on an indemnity basis should be the subject of an order.

21. I make orders as appear at the commencement of these reasons.

I certify that the preceding twenty-one (21) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Berman.

Associate:

Dated: 16 March 2023