Bonnel & Jephson (No 2)
[2023] FedCFamC1F 226
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Bonnel & Jephson (No 2) [2023] FedCFamC1F 226
File number: BRC 12366 of 2021 Judgment of: BAUMANN J Date of judgment: 17 January 2023 Catchwords: FAMILY LAW – PROPERTY – costs sought by Second Respondent Cases cited: Bonnel & Jephson [2022] FedCFamC1F 812 Division: Division 1 First Instance Number of paragraphs: 9 Date of last submission/s: 17 January 2023 Date of hearing: 17 January 2023 Place: Brisbane Counsel for the Applicant: Mr Tolton Solicitor for the Applicant: ABKJ Lawyers Counsel for the Respondents: Mr Blond Solicitor for the First Respondent: Small Myers Hughes Solicitor for the Second Respondent: Quinn Family Law ORDERS
BRC 12366 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS BONNEL
Applicant
AND: MR JEPHSON
First Respondent
MS FAIRBURN
Second Respondent
order made by:
BAUMANN J
DATE OF ORDER:
17 JANUARY 2023
THE COURT ORDERS:
1.That the Applicant wife shall deposit the sum of $9,265.10 to her solicitors, ABKJ Lawyers, by no later than 4.00pm on 18 January 2023.
2.That the Applicant wife instruct her solicitors to inform the solicitors for the Intervenor, Ms Fairburn, once such funds have been paid.
3.That pursuant to s 114 of the Family Law Act1975 (Cth) Applicant wife is restrained from giving any instructions to ABKJ Lawyers for the disposal of any of the funds held in their trust account towards any of her current costs, future costs or any other disbursements pending determination of the costs application in respect of the summary dismissal orders made by the Court on 26 September 2022.
4.That the issue of costs of and incidental to the Application in a proceeding filed 5 December 2022 be reserved.
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 the pseudonym Bonnel & Jephson has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
(Settled from the oral reasons delivered)
BAUMANN J:
The application before me today is just another example of the way in which, apparently, these parties are able to incur costs on matters without dealing with the substantive proceedings. The substantive proceedings between the husband and wife in these proceedings are now parenting proceedings and substantive property proceedings. The history is clear to the parties and is reflected in earlier Judgments. Importantly, for this application brought by Ms Fairburn who was previously a party to the substantive proceedings, on 26 September 2022, the Court, after hearing submissions, made orders that, effectively, summarily dismissed the wife’s applications against Ms Fairburn and effectively, other related entities controlled by Ms Fairburn. That is to be seen in the context of the history of that matter, as set out in the Reasons for Judgment published at that time (see Bonnel & Jephson [2022] FedCFamC1F 812).
Aware of an application for costs which Ms Fairburn wished to pursue, directions were made and Ms Fairburn did, on 30 September 2022, that is, within four days of the application being summarily dismissed, make an application for costs. She seeks costs on an indemnity basis, as set out in the submissions of her Counsel, Mr O. The amount of costs she seeks on an indemnity basis for that application is $98,448.
The submissions prepared by Mr Tolton, Counsel for the wife, who could say nothing more to assist his client than he has done, both on 26 September 2022, when the application of his client was summarily dismissed, and in his written submissions as to costs, concludes in the final paragraph:
The Court should order costs on a party party basis. There are no exceptional circumstances to justify a departure from the normal rule.
I have not yet determined, but will fix costs in this matter on either a party-and-party basis or indemnity basis once I set out proper reasons for exercising discretion to order costs at all. The Court is entitled to accept that the wife knew, at least as at the time her written costs submissions were filed on 31 October 2022, that there was a potential liability, even on her own admission, that she would owe moneys to Ms Fairburn for engaging Ms Fairburn in the substantive property proceedings. The affidavit of the wife that was filed 23 December 2022 identifies a number of what she says were pressing debts that she was finding “overwhelming”. Included in those debts (but this one owed to her), she alleges, are moneys owed by the husband by way of child support. It seems that a child support hearing of some nature in late 2022 was the catalyst for a concern by Ms Fairburn that the wife’s property at Suburb Q that the wife had purchased in 2009 before the marriage, and had held during the course of the relationship, was a catalyst for the application for injunctive relief filed on 5 December 2022.
By the time the Application had been filed, and was further amended on 13 January 2023, the wife had sold her property. She was entitled to do so as a matter of law. There was no injunction restraining her. There was no application at the time she effected the sale of the property seeking to restrain her. That timing does not benefit, of course, Ms Fairburn.
Nonetheless, it is clear that the wife used the available nett funds from the sale of the property to pay a number of expenses, as a matter of her discretion it seems to me. These included a total of $75,650.90 to her current solicitors, ABKJ Lawyers, both in respect of an amount of $25,650 for legal fees incurred and $50,000 “on account of anticipated legal costs and disbursements” (paragraph 48.4 of the wife’s affidavit filed 23 December 2022).
From the sale of the property, with the expenses set out at paragraph 48 of the wife’s affidavit filed 23 December 2022, the wife retained at that stage $127,016.35. There is nothing in her material, at paragraph 49, that reveals the choices she made and who she paid, were other than a discretionary decision by her, including $28,590.87 to her father, said to be in reimbursement of funds he loaned her to pay invoices previously issued by ABKJ Lawyers. I can only assume it must have been funds in addition to those paid of $25,650.90 referred to in paragraph 48.3. A sum of $33,966.38 was paid to Mr P “in reimbursement of funds loaned to me”, she says, by Mr P to pay invoices issued by Queensland Legal Practice, R Lawyers and S Lawyers. A payment of $17,750 was also made in payment of 71 weeks of unpaid rent to a Mr T, who I understand may be the father of her current partner. No evidence of what were the tenancy arrangements is before the Court, but nonetheless she chose to pay that money.
There is also a $10,000 payment made on an overdue MasterCard account and then at paragraph 49.5, she claimed on oath that she had an retained approximately $10,000 in payment of day-to-day expenses, such as rent (noting it has already been referred to earlier), groceries, utilities, medical expenses, clothing and items for the children. Now, I accept that the payment for items for the children would be seen by the wife in the context of what she claims to be outstanding child support payable by the father of the children being $23,631.39 (paragraph 23). Mr Tolton from the bar table today, when inquired as to how much of the funds of $27,000 that were available to the wife under her affidavit as at 23 December 2022, noting that that is, as at today, just over three weeks ago, says that the amount of $27,000 has now been reduced to $13,000.
No explanation as to how the wife spent $14,000 in three weeks is given. In the exercise of discretion, it is appropriate, in my view, that the sum of at least $30,000 be available to meet any costs order that may be made. It may not cover the costs order. In my view, noting that the children have to go to school and without any further details of other income that the wife has, I would not regard it as appropriate to remove every last cent that she has in her possession. The wife does demonstrate a preference to pay anyone else other than Ms Fairburn with her decisions she has made to date. That will need to be examined perhaps in the substantive proceedings. But at this stage, I am comfortable in ordering that:
(a)the wife shall, by 4.00pm tomorrow, 18 January, deposit to her solicitors, ABKJ Lawyers, the sum of $9,265.10;
(b)the wife instruct her solicitors to inform the solicitors for Ms Fairburn once the funds have been paid;
(c)an injunction issue restraining the wife from giving any instructions to ABKJ Lawyers for the disposal of any of the funds held in their trust account towards any of her current costs, future costs or any other disbursements pending determination of the costs application in respect of the summary dismissal orders made by the Court on 26 September 2022; and
(d)the costs of the application today be reserved.
I certify that the preceding nine (9) numbered paragraphs are a true copy of the ex tempore Reasons for Judgment of the Honourable Justice Baumann. Associate:
Dated: 4 May 2023