Bima

[2015] FamCA 25

AMENDED PURSUANT TO RULE 17.02 OF THE FAMILY LAW RULES 2004

FAMILY COURT OF AUSTRALIA

BIMA AND ANOR [2015] FamCA 25

FAMILY LAW – COSTS

Family Law Act 1975 (Cth)

Browne v Green (2002) FLC 93-115
Harshani & Darnith and Anor [2011] FamCA 560
I and I (No 2) (1995) FLC 92-625
Kohan and Kohan (1993) FLC 92-340
Munday v Bowman (1997) FLC 92-784
Prantage & Prantage (2013) FLC 93-545

APPLICANTS: Mr Bima and Ms Wibowo

FILE NUMBER: ADC 3576 of 2014

DATE DELIVERED: 30 January 2015

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: By Way Of Written Submissions

SUBMISSIONS RECEIVED FROM:

SOLICITOR FOR THE

MINISTER FOR IMMIGRATION &

BORDER PROTECTION:

Australian Government Solicitor

Orders

1. That Mr Bima and Ms Wibowo pay the costs of the Minister for Immigration and Border Protection fixed in the sum of $7500.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: ADC 3576 of 2014

Mr Bima and Ms Wibowo 

Applicants

REASONS FOR JUDGMENT

1. On 9 December 2014, I removed the Minister for Immigration and Border Protection as a party to the proceedings brought by Mr Bima and Ms Wibowo (to whom I shall refer as the applicants). I made provision including setting a timetable for costs’ applications to be determined by written submission.

2. The Minister made application for costs on 8 January 2015 which was the time permitted.  The respondents had until 22 January 2015 to reply. They did not file anything notwithstanding they were represented by solicitors.

3. My order provided for any such application for costs to be determined in chambers.

4. I propose to make an order against the applicants for the reasons that follow.

5. The Minister seeks costs of $7,500.

6. In their substantive application, the applicants sought a declaration pursuant to s 69VA of the Family Law Act 1975 (Cth) (“the Act”) and named the Minister as a respondent. The Minister then sought to be removed as a party. He was successful.

7. It is the general rule, as prescribed in s 117(1) of the Act, that each party should bear their own costs. The Court is, however, empowered by s 17(2) of the Act to make an order for costs if it is of the “opinion that there are circumstances that justify it in doing so”. If the Court finds a justifying circumstance, it still has to have regard to the factors in s 117(2A) in considering what order, if any, should be made (see I and I (No 2) (1995) FLC 92-625).

8. The Minister’s submissions addressed the relevant factors in s 117(2A) and I refer to the relevant factors in the headings I now use.

The financial circumstances of the parties

1. There is no evidence before the Court as to the financial circumstances of the applicants.

2. The Minister is funded from the public purse and I see no reason why the public rather than the applicants should be liable to pay those costs.

Legal aid

1. There is no evidence that anyone is in receipt of assistance by way of Legal Aid.

The conduct of the parties

1. The Minister was critical of the applicants’ conduct. That conduct must be as a litigant (see Prantage & Prantage (2013) FLC 93-545). The Minister submitted that his costs were unnecessarily incurred as a result of the applicants’ requests and conduct. I agree. I found the applicants’ evidence and case to be irrelevant and / or misconceived. I was critical of the applicants’ affidavit material and said at paragraph six that:

   … No evidence was put before the Court as to what this adoption process meant in law and there was no expert evidence otherwise. That may not be necessary for the purposes of this disjoinder application but it does give rise to the question of the relevance of the joining by the applicants of the respondent to these proceedings.

Wholly unsuccessful

1. The Minister also had to prepare for the hearing on issues propounded by the applicants which were unsuccessful. They included: (a) that the Rules were inapplicable and not apposite to deal with the order for disjoinder sought by the Minister; (b) that the High Court Rules 2004 (Cth) were actually of direct application; and (c) that the Minister’s reliance on relevant jurisprudence of the Family Court of Australia was erroneous as each of those cases was asserted to be incorrectly decided. I rejected the submissions of the applicants as “misconceived”. The conduct of the applicants has led to and resulted in the Minister incurring unnecessary costs. There can be no doubt after a contested dispute like this even at an interlocutory level, the applicants have been wholly unsuccessful. I ruled that “the applicants should not have joined the respondent”.

Written settlement offers

1. A further factor to consider is whether any written settlement offers had been made by the applicants or the Minister. In Browne v Green (2002) FLC 93-115, the Full Court considered the importance of offers and said at paragraph 57:

   We think that whilst s 117(2A) does not provide any direct guidance to where weight should be given in any one particular case, it is very important for the Court to give proper consideration to written offers of settlement that have been made. The insertion of s 117C into the legislation is a clear indication of the desire of Parliament to enable parties to avoid unnecessary litigation by indicating to the other party an appropriate basis upon which litigation can be settled. The failure to heed a reasonable offer in circumstances where there is adequate knowledge of the parties at the time the offer is made to give it a proper consideration, is something to which very significant weight indeed ought normally be given. It is clearly a circumstance that would justify the making of an order for costs in favour of the husband.

2. The Minister had negotiated with the applicants’ solicitor, Mr Greg Finlayson. The applicants would only agree to remove the Minister if no order for costs was sought against them. The Minister refused.

3. An offer was then made to the applicants to settle the costs dispute in the sum of $6,000 but they did not respond.

Any other relevant matters

1. The Minister referred to the case of Harshani & Darnith and Anor [2011] FamCA 560 where I held that a further factor that may justify the making of an order for costs is where there was no basis to join a party to a proceeding. Whilst this overlaps with the matters that I have considered above, it is certainly a factor that should be taken into account.

Conclusion

1. I am satisfied that the circumstances of this case justify the making of an order for costs in favour of the Minister.

Quantum of Costs

1. The Minister’s total costs (including disbursements of $178.20) in these proceedings total $10,835 (inclusive of GST). This total does not include the professional costs incurred by the Minister in resolving the extant costs dispute between the Applicants and the Minister which comes to approximately $1,500. The Minister seeks that an order be made for the Applicants to pay the Minister’s costs fixed in the sum of $7,500, on the basis that such an order would avoid the further and unnecessary cost of participating in taxation before a Registrar.

2. Rule 19.18 of the Rules provides for the method of calculation of costs. In particular, subrule 19.18(1) provides that the Court may order that a party is entitled to costs on a number of different bases, one of which is a specific amount.

3. Subrule 19.18(3) of the Rules provides that the Court may consider a number of factors in making an order under subrule 19.18(1). They include:

   (a)The importance, complexity or difficulty of the issues;

   (b)The reasonableness of each party’s behaviour in the case;

   (c)The rates ordinarily payable to lawyers in comparable cases;

   (d)Whether a lawyer’s conduct has been improper or unreasonable;

   (e)The time properly spent on the case, or in complying with pre-action procedures; and

   (f)Expenses properly paid or payable.

4. In Prantage (supra), the Full Court referred to the settled law relating to indemnity costs and the Full Court decision of Kohan and Kohan (1993) FLC 92-340. The Court emphasised the well accepted proposition that indemnity costs orders are “a very great departure from the normal standard” and that they should only be ordered in exceptional circumstances. Some of those circumstances were summarised by Holden J in Munday v Bowman (1997) FLC 92-784 at page 84,660:

   (a)Where it appears that an action has been commenced or continued in circumstances where a party properly advised should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive or because of some wilful disregard of the known facts (see Fountain Selected Meats (Sales) Pty. Ltd. v. International Produce Merchants Pty. Ltd. [1988] 81 ALR 397.

   (b)Making allegations of fraud, knowing them to be false, and the making of irrelevant allegations of fraud (see Fountain Selected Meats (Sales) Pty. Ltd. (supra)).

   (c)Evidence of particular misconduct causing loss of time to the court and to other parties (see Tetijo Holdings Pty. Ltd. v. Keeprite Australia Pty. Ltd (unreported, Federal Court, 3 May 1991)).

   (d)The making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions (see Ragatta Developments Pty. Ltd. v. Westpac Banking Corporation (unreported, Federal Court, 5 March 1993)).

   (e)An imprudent refusal of an offer to compromise.

5. The Minister is charged by the Australian Government Solicitor at a higher rate than that provided for in Part 1 of Schedule 3 to the Rules. Although a costs agreement was not provided, the Minister’s solicitor’s affidavit states that the total number of hours spent on this matter by the Australian Government Solicitors’ office up until 8 January 2015 is approximately 28 hours. The weighted average hourly rate for this matter is therefore $380.60, which is higher than the $224.50 per hour provided for in the Rules. An indemnity cost order or one sometimes called a solicitor and client cost order would have meant the Minister would have sought something around $10,850. He seeks $7,500 which is 69 per cent of the higher sum. At $224.50 per hour which is the scale rate, the Minister has reduced his claim to somewhere close to the scale rate. That calculation is obviously done on a proportional basis but I accept that the scale has a different approach and does not just include hourly rates. I consider the claim is close enough to what might be described as the scale rate.

6. Even if I am wrong about that, I am satisfied that the circumstances must constitute exceptional circumstances that warrant exercising my discretion to make an order that departs from the normal standard  because of the reasons in paragraphs 10,12,13 and 14 above.

7. There is an obvious benefit to all parties if the costs ordered were in a fixed amount. This is because the parties would be able to achieve finality, without incurring further expenses, delays and aggravation.

8. On that basis, I make orders that the applicants pay the Minister’s costs in these proceedings, fixed in the sum of $7,500.

I certify that the preceding Twenty Six (26) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 30 January 2015.

Associate: 

Date:  30 January 2015