BROXHAM & BROXHAM AND ORS (NO. 2)

[2012] FamCA 1085

FAMILY COURT OF AUSTRALIA

BROXHAM & BROXHAM AND ORS (NO. 2) [2012] FamCA 1085

FAMILY LAW – COSTS – application for costs on an indemnity basis by the second and third respondents against the wife – where the wife was wholly unsuccessful – where the wife has access to funds sufficient to meet a costs order – where there were no offers to settle – where order made that wife pay the second and third respondents costs – whether costs should be paid on an indemnity basis – where the factors of the case do not warrant an order that costs be paid on an indemnity basis.

Family Law Act 1975 (Cth)

Colgate-Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248
Kohan & Kohan (1993) FLC 92-340

Lenova & Lenova (Costs) [2011] FamCAFC 141

Yunghanns & Ors & Yunghanns & Ors & Yunghanns (2000) FLC 93-029

APPLICANT: Ms Broxham

FIRST RESPONDENT: Mr Broxham

SECOND RESPONDENT: Mr Broxham Senior

THIRD RESPONDENT: Ms Broxham Senior

FILE NUMBER: BRC 7505 of 2010

DATE DELIVERED: 17 December 2012

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Murphy J

HEARING DATE: 17 December 2012

REPRESENTATION

THE APPLICANT: Appearing in person

SOLICITOR FOR THE 1^ST RESPONDENT: Mr Hall of JHL Lawyers

COUNSEL FOR THE 2^ND & 3^RD

RESPONDENTS:

Mr Hackett

SOLICITOR FOR THE 2^ND & 3^RD

RESPONDENTS:

Quinn & Scattini

Orders

IT IS ORDERED THAT

1. The Applicant Wife pay the costs of the 2^nd and 3^rd Respondents of and incidental to the Application in a Case filed 21 June 2012 to be agreed in writing between the parties or failing agreement to be assessed on a party/party basis.

2. The Applicant Wife pay the costs of the 2^nd and 3^rd Respondents of and incidental to the Application in a Case filed 11 October 2012 to be agreed in writing between the parties or failing agreement to be assessed on a party/party basis.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Broxham & Broxham 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 BRISBANE

FILE NUMBER: BRC 7505 of 2010

Ms Broxham

Applicant

And

Mr Broxham

First Respondent

And

Mr Broxham Senior

Second Respondent

And

Ms Broxham Senior

Third Respondent

EX TEMPORE

REASONS FOR JUDGMENT

1. On 10 September 2012 I delivered reasons in respect of an application for injunctions brought by Ms Broxham, who I there referred to and today refer to as “the wife.”  The Reasons for Judgment handed down by me on that occasion set out the injunctions sought by the wife.  Ultimately, I made an order that the wife’s Application in a Case be dismissed. 

2. By further application, the second and third respondents, who are the husband’s parents, seek an order for costs of and incidental to those proceedings.  Those costs are sought on an indemnity basis.

3. Reference to the Reasons for Judgment will reveal the arguments advanced in the earlier proceedings before me.  It will be seen that the issues involved the inter-relationship between proceedings in this Court and proceedings previously determined in the Supreme Court of New South Wales.  Much of the argument in the earlier application before me revolved around an application by the second and third respondents that the wife was effectively estopped from raising the case that she now seeks to agitate in this Court. In particular, it was said that as a result of that that her case was “doomed to fail” as that expression is used in the authorities.

4. Ultimately, a decision was made in respect of that argument to the effect that the wife’s application was not doomed to fail.  However, separate to that, the relief sought by the wife was dependent upon findings that the funds to which the mooted injunctions were directed were at risk of being dissipated by the second and third respondents. 

5. Reference to those earlier reasons will show I was not persuaded of any such risk.  I found, for example, that the written submissions on behalf of the applicant wife were silent on the question of risk as well as the question of “balance of convenience”. On the evidence before me, I was not satisfied that otherwise, there was any risk of the dissipation of assets so as to found the injunctive relief sought by the wife.  It is on that basis that the application filed by the wife was dismissed.

6. The principles in respect of the awarding of costs in this Court are well known and are referenced to section 117 of the Act. 

7. The general rule is that each party bears their own costs. However, the Act goes on to provide that costs can be awarded in the discretion of the Court and specifies a number of considerations to which reference should be had, among others, in the exercise of that discretion. 

8. A written outline filed on behalf of the second and third respondents in support of their application for costs points to the fact that the wife’s application before me was resisted without them filing any material and ultimately that position was, in effect, vindicated by reason of my findings; in particular, that I wasn’t satisfied of any risk of dissipation on the evidence before me.

9. It is then contended that the wife has been wholly unsuccessful within the meaning of section 117(2A).  Otherwise the written submissions refer to the fact that, in respect of financial circumstances the only evidence of the value of the matrimonial pool - as it is called – is a half interest in the net sale proceeds of a property known as Property A, which is currently held in the trust account of a firm of solicitors in an amount of $925,000.  It is submitted, and I accept, that that sum is available to meet the costs order, together with the cost orders made by the Supreme Court of New South Wales.

10. The wife submits before me that her financial circumstances are otherwise modest and I accept that submission. However, her position in that respect needs, in my view, to be seen in the context of the amount of just short of a million dollars sitting in a trust account. 

11. Otherwise, the conduct of the proceedings within the meaning of section 117(2AC) of the Act is relied upon by the second and third respondents, and they point to the history of the litigation between the parties and in particular the history of the litigation in the Supreme Court of New South Wales, which preceded the litigation in this Court.

12. There is no evidence of any offers to settle, neither is either party in receipt of any legal aid. 

13. It is contended that the proceedings against the parents “have been wholly necessitated by the failure of the wife to proceed with her claims in the Supreme Court of New South Wales.”  So much is in my view true on its face but the unusual circumstances in which the Supreme Court proceedings unfolded in the way that they did are detailed in my earlier reasons for judgment.  In particular, I pointed out that the wife and her husband were joint applicants for relief in that Court and had filed a common statement of claim seeking relief against the second and third respondents.

14. During the course of the proceedings in that Court the husband chose to take no further action in respect of the claim made by him.  That action by him had a number of consequences that impacted upon the claim made by the wife, as I sought to point out in my earlier reasons. 

15. Counsel for the second and third respondents relies in his written submissions upon a recent decision of the Full Court in Lenova & Lenova (Costs) [2011] FamCAFC 141. I agree that what was said there has application to the facts of this case.

16. Paragraph 13 of the judgment, the Full Court said:

    Whilst regard is had to the financial circumstances of the respondent wife she was advised by legal practitioners at each stage of the proceedings.  She can, in our view, be seen to have known the risks of refusing to compromise in the face of a written offer made before the appeal was filed.  That factor, together with the husband’s success in the appeal, warrants an order for costs being made in favour of the husband.

17. Whilst there is no evidence before me of any offers to settle the comments in respect of the wife being advised by apparently competent practitioners throughout the course of the proceedings in New South Wales and in this Court remains pertinent. 

18. In short, although section 117(1) provides that each party should bear their own costs litigants in this Court are not free from litigating at peril of an order for costs given the discretion which is enlivened by reference to section 117(2A) and the factors enumerated within that section.  Were it otherwise parties would be able to litigate with impunity and indeed, with immunity. In my view that is not consistent with the discretion inherent in section 117 or the interests of justice.

19. In all of the circumstances of this case it seems to me that the circumstances - in particular the success by the second and third respondents and the wife being wholly unsuccessful, together with the other facts and circumstances to which I have made reference, justify an order being made for costs in favour of the second and third respondents. 

20. An additional aspect of that application is that an order be made for indemnity costs.  In his written submission, counsel refers to the well-known statement by Sheppard J in Colgate-Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248 and the later decisions of the Full Court of this Court in Yunghanns & Ors & Yunghanns & Ors & Yunghanns (2000) FLC 93-029 and Kohan & Kohan (1993) FLC 92-340. In particular, reference is made to the often-cited statement that an award of indemnity costs is “a very great departure from the normal standard”. Such an order is, nevertheless dependent upon the particular circumstances of the case.

21. The second and third respondents submit that the circumstances outlined in the written outline of submissions warrant an order for indemnity costs in this case.  I am not persuaded that an order for indemnity costs ought be made. 

22. Primarily I am persuaded against relief in those terms by reference to the unusual circumstances and the difficult position in which the wife found herself by reason of the husband, as it were, withdrawing from the proceedings in the Supreme Court with the consequences that had for her within the context of the Supreme Court proceedings, which such consequences, were in effect “carried over” to the proceedings in this Court.

23. The self-represented wife contends that many of the costs forming the basis of the claim by the second and third respondents relate to matters raised by them pertaining to the effect of the Supreme Court proceedings. In effect, she argues that they were unsuccessful in respect of that application.  It is argued that the majority of the issues raised by the second and third respondents relate to what might be described conveniently as “the estoppel argument” mounted by them. 

24. I am not persuaded that these matters are relevant to the making of an order for costs. If relevant and sustainable, they seem to me to be matters pertaining to any taxation of the amounts comprising the ultimate award.

25. In addition to the matters just referred to, an application is made by the second and third respondents in respect of the cost of the instant application.

26. Each and all of the circumstances to which I have earlier referred seem to me to pertain to an application by the second and third respondents for their costs of the application for costs before me today. 

27. In addition, it might be noted that the application was foreshadowed in correspondence sent by the solicitor for the second and third respondents and there is no evidence before me of any offers to settle made by the wife in response to that foreshadowed application.  It seems to me that is an additional matter to which I should have regard in considering an application for costs. Otherwise all of the facts and circumstances to which I have just referred are pertinent to the instant application and justify an order for costs in favour of the second and third respondents.

I certify that the preceding twenty-seven (27) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Murphy delivered on 17 December 2012.

Associate: 

Date:  21 December 2012