FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Blatch & Blatch (No 2) [2022] FedCFamC1F 41
File number(s): SYC 1613 of 2021 Judgment of: CAMPTON J Date of judgment: 8 February 2022 Catchwords: FAMILY LAW – COSTS – Where both parties seek costs of determined interim applications and opposes the costs claim of the other – Where the mother seeks orders that the father pay her costs of and incidental to the hearing of her interim financial and child support enforcement application on an indemnity basis – Where an order for indemnity costs in a fixed sum is made in favour of the mother – Where the father seeks orders that the mother pay his costs in the interim parenting proceedings including by way of review and in an amount representing the difference in costs of potential single experts – Where there is otherwise insufficient justification to depart from the usual rule that each party bears their own costs of the interim parenting proceedings including by way of review – Father’s application dismissed. Legislation: Child Support (Registration and Collection) Act 1988 (Cth), s 113A
Family Law Act 1975 (Cth) s 117
Federal Circuit and Family Court of Australia ( Family Law) Rules 2021 (Cth) r 1.04 10.13, 12.08, 12.17
Cases cited: Anison & Anison [2019] FLC 93-908; [2019] FamCAFC 108
Atkins & Hunt [2017] FamCAFC 131
Collins & Collins (1985) FLC 91-603
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Kohan & Kohan (1993) FLC 92-340
Luadaka v Luadaka (1998) FLC 92-830; [1998] FamCA 1520
Mansfield and Ors & Mansfield and Anor (2019) FLC 93-920; [2019] FamCAFC 186
Penfold v Penfold (1980) 144 CLR 311; [1980] HCA 4
Phillips & Hansford (2020) FLC 93-941; [2020] FamCAFC 28
Division: Division 1 First Instance Number of paragraphs: 67 Date of hearing: 28 January 2022 Place: Sydney Counsel for the Applicant: Mr O’Reilly Solicitor for the Applicant: Landers & Rogers Counsel for the Respondent: Litigant in person ORDERS
SYC 1613 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS BLATCH
Applicant
AND: MR BLATCH
Respondent
ORDER MADE BY:
CAMPTON J
DATE OF ORDER:
8 FEBRUARY 2022
THE COURT ORDERS THAT:
1.Within 28 days of these orders the father pay the mother’s costs fixed in the sum of $20,000.
2.The Application in a Proceeding of the mother as to costs filed 20 December 2021 and the Response to an Application in a Proceeding of the father as to costs filed 26 January 2022 otherwise be dismissed.
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…
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- Blatch & Blatch (No 2) [2022] FedCFamC1F 41
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CaseChat Overview and Summary
The legal issues in the case centred around the father's responsibility to comply with r 1.04 and r 12.08 of the Rules, and whether his conduct warranted an order for costs in favour of the mother. The court found that the father's approach to the litigation was an affront to his responsibilities as a litigant, and justified an order for costs in favour of the mother. The court also found that the mother's interim property settlement and enforcement of child support arrears issues ought not to have been the subject of a defended hearing, and that the father's failures to facilitate the parties in obtaining single property expert evidence generated further unnecessary costs.
The court's reasoning was that the father's cavalier disregard for his responsibilities as a litigant, coupled with his superior financial position, justified an order for costs in favour of the mother. The court found that the mother's interim property settlement and enforcement of child support arrears issues ought not to have been the subject of a defended hearing, and that the father's failures to facilitate the parties in obtaining single property expert evidence generated further unnecessary costs. The court also found that the father's conduct during the litigation was an affront to his responsibilities as a litigant, and warranted an order for costs in favour of the mother. The court's outcome was that an order for costs in favour of the mother in respect of a portion of the interim financial proceedings, being as to interim property settlement and enforcement of child support arrears, was just in the circumstances so as to depart from the usual rule that each party bears their own costs. The mother sought that costs be paid on an indemnity basis and in the alternative on a scale basis, but the court found that such costs are payable on a party and party basis. The court also found that an order for indemnity costs is even more exceptional than in jurisdictions where the usual rule is that costs follow the event. The court found that indemnity cost orders are made only in exceptional cases, and that such costs may be ordered where a case was pursued with "wilful disregard of known facts or clearly established law" and where there has been "an imprudent refusal of an offer to compromise". The court found that the father's conduct during the litigation fell within these categories, and that an order for costs in favour of the mother was just in the circumstances. The final orders were that the father's Response to an Application in a Proceeding for costs is to be dismissed and each party will bear their own costs of the interim parenting proceedings, including those of the review. The father has put the mother to significant legal expense in the context of the case as to interim property settlement and enforcement of child support arrears. Those issues ought to never have been the subject of a defended hearing. His failures to facilitate the parties obtaining single property expert evidence generated further unnecessary costs. An order for costs in favour of the mother in respect of a portion of the interim financial proceedings, being as to interim property settlement and enforcement of child support arrears, is just in the circumstances so as to depart from the usual rule that each party bears their own costs. The mother sought that costs be paid on an indemnity basis and in the alternative on a scale basis. It is well-settled that when costs are ordered by this Court, such costs are payable on a party and party basis. It has been held that the Court should not lightly depart from the ordinary rule (Kohan & Kohan (1993) FLC 92-340). It has also been accepted that in proceedings under the Act, where the usual rule is that each party shall bear his or her own costs, an order for indemnity costs is even more exceptional than in jurisdictions where the usual rule is that costs follow the event (See Mansfield and Ors & Mansfield and Anor (2019) FLC 93-920 at [7]). In relation to an award of indemnity costs, the recent Full Court decision of Phillips & Hansford [2020] FamCAFC 28, helpfully summarises the position as follows: "Indemnity cost orders are made only in exceptional cases (Kohan and Kohan (1993) FLC 92-340; Limousin v Limousin (Costs) (2007) 38 Fam LR 478; D & D (Costs) (No. 2) (2010) FLC 93-435). Whilst the categories of cases in which indemnity cost orders may be awarded are not closed, it is accepted that such costs may be ordered where a case was pursued with “wilful disregard of known facts or clearly established law” and where there has been “an imprudent refusal of an offer to compromise” (Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 at 233). In relation to the first category, it has been said that indemnity costs may be awarded where “the applicant, properly advised, should have known that he had no chance of success” (Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 at 401) and where “a party persists in what should on proper consideration be seen to be a hopeless case” (J Corp Pty Ltd v Australian Builders Labourers Federation Union of Workers – Western Australian Branch & Anor [1993] FCA 70 per French J at [5].
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Orders of the court
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Background
Background to the litigation
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Evidence Before The Court
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Decision
Reasons for decision
Ratio Decidendi
Legal Principle Established
The father gave some other explanations for his delays in facilitating the instructions to obtain single expert valuation opinions and meeting their costs. He was critical of disclosure being sought by the mother on what he described as “a drip-feed” basis. THE RELEVANT S 117(2A) CONSIDERATIONS AS IDENTIFIED BY THE PARTIES(a) The financial circumstance of each of the parties The assets and liabilities of the parents are identified in paragraph 111 of the primary reasons for judgment delivered on 30 November 2021 as adjusted by the orders made therein. The mother now has the $200,000 interim property adjustment. $307,000 remains available under the drawdown on the home mortgage. After implementation of the consent arrangement to fund the child support arrears, $270,256 will be available under the drawdown. The father’s income as recorded in his Financial Statement is not less than $350,000 per annum. The mother’s income as recorded in her Financial Statement is in the range of $137,709 per annum. The father’s income, property and resources are superior to those of the mother. This factor supports a costs order in favour of the mother and detracts from an order in favour of the father.(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 As recorded in the reasons of 30 November 2021, the scope of evidence heard in the parenting review had significantly enlarged from that before the senior registrar on 21 April 2021. This included:(a)The parties had undertaken four sessions of family therapy with Ms R that were completed by 24 June 2021;(b)Some CDT testing as ordered had been undertaken and results disclosed. Others had not; (c)An Independent Children's Lawyer ("the Independent Children's Lawyer") had been engaged in the proceedings; (d)The father had commenced spending supervised time with the children from 4 July 2021, with 11 periods of supervised time occurring up to 7 November 2021. Up to the date of the hearing on 21 April 2021, the father had spent only sporadic and restricted time with the children over the prior two years; and(e)Significantly each party and the Independent Children’s Lawyer on the hearing of the review sought to discharge all of the current interim parenting orders. Each agreed that an interim order should be made that the children live with the mother. Each party sought differing regimes regulating the terms of time spent by the father with the children and the conditions of that time. Each of the above mitigates against the making of a costs order as to the parenting proceedings and review as sought by the father. The evidence does not support a finding as prosecuted by the father to the effect that the mother has made allegations in the parenting proceedings knowing them to be false. I am unable to safely find that she has misled the Court by ignoring a number of disclosures provided by the father in May of 2021. The reasons for the primary judgment record the orders made to ensure the continuation of a meaningful relationship between the children and the father in terms that best promote their interests.