Cansdall and Cansdall (No.2)

[2020] FCCA 1930

FEDERAL CIRCUIT COURT OF AUSTRALIA

CANSDALL & CANSDALL (No.2) [2020] FCCA 1930

Catchwords:
FAMILY LAW – COSTS – wife’s application for indemnity costs – consideration of conduct of husband and his legal representatives – indemnity costs ordered.

Legislation:

Family Law Act 1975 (Cth), s.117

Cases cited:

Colgate-Palmolive Co v Cussons Pty Ltd [1993] FCA 801; 46 FCR 225; 1993 ALR 248; 28 IPR 561

Applicant: MR CANSDALL

Respondent: MS CANSDALL

File Number: MLC 2209 of 2018

Judgment of: Judge Mercuri

Hearing date: 11 June 2020

Date of Last Submission: 11 June 2020

Delivered at: Melbourne (via videoconference)

Delivered on: 12 June 2020

REPRESENTATION

Advocate for the applicant: Mr McConvill

Solicitors for the applicant: James McConvill and Associates

Counsel for the respondent: Mr Nicholson

Solicitors for the respondent: Morrison and Sawers

ORDERS

1. The applicant pay the respondent’s costs on an indemnity basis fixed in the sum of $14,605.

2. The amount payable pursuant to order 1 herein be paid to the respondent by way of an adjustment of the surplus funds payable to the parties under order 13(d) of the minute of orders made by her Honour Judge Stewart on 14 November 2018.

AND THE COURT NOTES THAT:

(A)Section 121 of the Family Law Act 1975 (Cth) provides that it is an offence punishable by imprisonment for up to one year to publish or disseminate to the public any account of family law proceedings which identifies the parties, witnesses or other people concerned with the proceedings, unless specifically authorised by the court.

IT IS NOTED that publication of this judgment under the pseudonym is Cansdall & Cansdall (No.2) approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 2209 of 2018

MR CANSDALL

Applicant

And

MS CANSDALL

Respondent

REASONS FOR JUDGMENT

(revised from the transcript)

1. These reasons for judgment were delivered orally. They have been corrected from the transcript. Grammatical errors have been corrected and an attempt has been made to render the orally delivered reasons amenable to being read.

2. This is a costs application made by the wife. 

3. The wife seeks costs of and essential to her application to this application on an indemnity basis.  The husband opposes that application and says that the ordinary rules that each party bear their own costs ought to apply. 

4. The starting point in considering this matter is section 117 of the Family Law Act 1975 (Cth) (“the Act”), which essentially provides that each party ought to bear their own costs. Section 117(2) of the Act however, goes on to say that where the Court considers it appropriate, it may make such orders as to costs as the Court considers just. Section 117(2A) sets out the factors which the Court is to have regard to in determining what order, if any, should be made.

5. The wife essentially points to the husband’s conduct in relation to the proceedings and the fact that the husband was wholly unsuccessful in his application before the Court which was determined yesterday as the basis for a costs to be made in her favour.  Moreover, the wife says that because of the husband’s conduct in these proceedings, costs ought to be ordered on an indemnity basis.

6. In particular, the wife points to the fact that properly advised, the husband ought to have been aware that his application had no reasonable prospects of success.  Moreover, the husband was put on notice that the jurisdictional objection would be raised when the matter came before Registrar Hayward on Tuesday 9 June 2020.  Notwithstanding that, the husband persisted in his application and filed further affidavit material, adding to the wife’s costs in defending this matter.

7. In addition, the wife asserted that the husband’s conduct in this matter has unnecessarily prejudiced the wife’s position in circumstances where, on anyone’s case, this is a modest pool.  Rather than maximise the amount of the pool which would be available for distribution between the parties, it was submitted that by pursuing this application, the husband further delayed the sale and settlement of the property and put the wife to additional expense. 

8. This occurred in circumstances where the wife has the care of two children and is not in paid employment.  The husband continued to press his opposition to the sale of the property which is further evidenced by his application to VCAT in relation to the appointment of the agent. 

9. It was submitted that the husband’s conduct has unduly prolonged the proceedings and the costs associated with them. 

10. The husband, for his part, says that he was not motivated by any improper purpose but that he simply wanted to maximise the profit derived from the sale of the property and he ought not be penalised for doing so.  The husband also submitted that:

    a)he does not have large financial resources;

    b)his income is very modest; and

    c)he would not be able to afford any costs order, let alone an indemnity costs order on the scale sought by the wife.

11. It was therefore submitted by the husband that no costs order should be made or, in the alternative, if a costs order is to be made, it should be ordered on scale. 

12. In reply, the wife submitted that to the extent that the husband does not have income that he could use to meet any costs order, an order could be made that the costs be met from the husband’s share of the property distribution following the sale.

13. Having regard to the circumstances in which indemnity costs might be granted as outlined in Colgate-Palmolive Co v Cussons Pty Ltd [1993] FCA 801; 46 FCR 225; 1993 ALR 248; 28 IPR 561, I am satisfied that the husband’s conduct in pursuing his application to vary the orders made on 15 July 2019 (“July 2019 orders”) is such that the ordinary rule that each party bear their own costs ought to be departed from in this instance. I am also satisfied that the husband’s conduct is such that an order for indemnity costs ought to be made.

14. It is clear from the correspondence annexed to the affidavit of Ms B affirmed and filed on 26 May 2020 that the husband’s solicitor was put on notice that:

    a)the wife’s view was that there was no proper basis for an application to vary the July 2019 orders; and

    b)should the husband proceed with his application, a costs order would be sought.

15. At the hearing before me, the husband’s legal representative was asked to identify the basis of the Court’s powers to make the orders sought by the applicant to vary the July 2019 orders. No provision in the Act or elsewhere was identified as a source of this power. Rather, the husband’s legal representative simply stated that the July 2019 orders were unworkable. Moreover, he indicated that the appropriate course was for an application to be made for an appeal out of time. The husband’s legal representative then made an oral application for a stay which was not acceded to.

16. In those circumstances, I am satisfied that a costs order ought to be made and for those costs to be awarded on an indemnity basis. 

17. As to the quantum of costs claimed, the wife’s solicitor provided a table setting out costs incurred to 4 June 2020 which totalled $10,805 to the husband and his legal representatives. At the hearing before me yesterday, the wife also claimed that further additional costs were incurred in the sum of $3,800 being for an additional court appearance by counsel and the perusal of another two affidavits which were filed by the husband, the most recent of which was filed yesterday morning on the day of the second hearing.  The husband did not challenge any of the costs itemised in Annexure 2 to the affidavit of Ms B affirmed and filed on 5 June 2020. 

18. In those circumstances, I am satisfied that a costs order ought to be made for the costs claimed by the wife in these proceedings. Coming back to section 117(2) of the Act, I am satisfied that such an order is just in the circumstances.

I certify that the preceding eighteen (18) paragraphs are a true copy of the reasons for judgment of Judge Mercuri

Associate: 

Date:         15 July 2020