Carlson and Acuff and Anor (SSAT Appeal) (No.2)
[2010] FMCAfam 1062
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| CARLSON & ACUFF & ANOR (SSAT APPEAL) (No.2) | [2010] FMCAfam 1062 |
| CHILD SUPPORT – Costs – 117(2) Child Support (Assessment) Act. |
| Child Support (Registration and Collection) Act 1988, ss.105, 101(1)(b), 110B Family Law Act 1975, s.117(1) Federal Magistrates Court Rules 2001 Federal Proceedings (Costs) Act 1981, ss.3(1)(g), 3(1)(ga), 6 and 7 |
| Bolinger & Ivy [2008] FamCA 274 Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 Forbes & Beam (2008) 222 FLR 96; [2008] FamCAFC 189 Kavanagh & Madgwick (No. 3) [2008] FMCAfam 287 Oshlack v Richmond River Council [1998] HCA 11; (1998) 193 CLR 72; (1998) 152 ALR 83; (1998) 72 ALJR 578; (1997) 96 LGERA 173 Overton Investments Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 [2001] NSWCA 137; (2001) 113 LGERA 439 Penfold v Penfold (1980) 144 CLR 311; [1980] HCA 4; (1980) FLC 90-800; (1980) 28 ALR 213; (1980) 5 Fam LR 579; 54 ALJR 142 Robbins & Rosemount (No. 2) [2008] FamCA 494 |
| Appellant: | MR CARLSON |
| First Respondent: | MS ACUFF |
| Second Respondent: | CHILD SUPPORT REGISTRAR |
| File Number: | HBC 1208 of 2008 |
| Judgment of: | Riethmuller FM |
| Hearing date: | 25 January 2010 |
| Date of Last Submission: | 15 July 2010 |
| Delivered at: | Melbourne |
| Delivered on: | 7 October 2010 |
REPRESENTATION
| Counsel for the Appellant: | The Appellant appearing in person |
| Solicitors for the First Respondent: | Mr Blissenden |
| Solicitors for the Second Respondent: | Blake Dawson |
ORDERS
The appellant to pay the costs of providing the transcript fixed at $1,703.57.
IT IS NOTED that publication of this judgment under the pseudonym Carlson & Acuff & Anor (SSAT Appeal) (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT MELBOURNE |
HBC 1208 of 2008
| MR CARLSON |
Appellant
And
| MS ACUFF |
First Respondent
| CHILD SUPPORT REGISTRAR |
Second Respondent
REASONS FOR JUDGMENT
The appellant lodged an appeal from a decision of the Social Security Appeals Tribunal (‘SSAT’) dated 29 October 2008 with respect to the child support assessment of the appellant and the first respondent. The appeal was allowed and the matter remitted to the SSAT. The facts and the reasons are set out in Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677.
On 22 June 2009 I ordered the Child Support Agency (‘CSA’) to provide the SSAT Appeal transcript (‘transcript’) to the Court and to the parties. The CSA was to pay all the costs associated with providing the transcript and the question of which party would pay be reserved for the final hearing.
On 30 June 2010 I ordered the second respondent and the appellant to provide written submissions on the issue of the costs of the transcript. To date the appellant has not provided any submissions with respect to this issue.
The invoices received by the CSA in relation to the provision of the transcript for the 8 July 2008 hearing and 21 August 2008 indicate a costs of $147.62 and $1,555.95 respectively. This puts the total cost of the transcript at $1,703.57.
The Law
Under s.117(1) of the Family Law Act 1975 (Cth) the starting point is that each party should bear their own costs.
117 [Costs ] (1) Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AB, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs. (emphasis added)
The proceeding in Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 concerned an appeal that was brought under s.110B of the Child Support (Registration and Collection) Act 1988 against the SSAT’s decision. Section 105 of that Act provides that the Family Law Act applies to proceedings under the Registration and Collection Act. Accordingly, the issue of costs is governed by the Family Law Act. Pursuant to s.117(2A) of the Family Law Act, if the Court is of the opinion that the circumstances justify making an order as to costs, it may do so.
117 [Costs ]
…
(2) If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just. (emphasis added)
In exercising its discretion, the Court must consider the factors set out in s.117(2A) of the Family Law Act.
117 [Costs ]
…
(2A) In considering what order (if any) should be made under subsection (2), the court shall have regard to:
(a) the financial circumstances of each of the parties to the proceedings;
(b) whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
(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;
(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;
(e) whether any party to the proceedings has been wholly unsuccessful in the proceedings;
(f) whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and
(g) such other matters as the court considers relevant.
The financial circumstances of the parties
The CSA submits that it does not have a budgetary allocation for the provision of transcripts to litigants. I note that the Child Support Registrar is a Federal Government Agency funded by the taxpayers of Australia, competing with other government service providers for limited funds.
The CSA suggest the appellant has sufficient financial means to pay the cost of the transcript. The reasons in Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 note that the appellant is employed in the public service (at para.[11]), has a gross salary of over $60,000 (at para.[9]), and can afford to send his children to private school (at para.[16]).
However, the appellant works part time as a public servant (at para.[47]) and has submitted that he had forgone half of his gross salary, approximately $30,000 per annum, to care for the children (at para.[73]).
The CSA argues that the appellant has borrowed against his property to incorporate and run his company (at para.[14]). To clarify, the reasons refer to the appellant borrowing against his home to provide loans to his company. In the reasons it was noted that the appellant is a parent with shared care (and with full care of an adult child at university) who should not be required to borrow against a ‘modest home’ to make child support payments: (at para.[30]).
On his financial statement filed on 6 May 2009, the appellant’s liabilities include a home mortgage and various credit cards that together total $562,021.
The first respondent has not worked since she was granted a disability pension and the SSAT accepted that she had no earning capacity: Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 at para [15].
Receipt of legal aid
The appellant is not in receipt of assistance by way of Legal Aid.
The conduct of the parties
In considering the conduct of the parties to ‘the proceedings’ the Court’s consideration is limited to their conduct in these proceedings: see Kavanagh & Madgwick (No.3) [2008] FMCAfam 287 at para.[15].
The Child Support Registrar is automatically a party to applications to the SSAT for review of its decision: s.101(1)(b) of the Registration and Collection Act. With the exception of the issue of costs, the CSA has played no active role in the proceedings. I accept the CSA’s submission that this is similar to when an application for judicial review is lodged against a decision of a lower court or tribunal, that court or tribunal will not actively oppose the application and submit to any order the review body thinks fit. Furthermore, on 3 September 2009 I had ordered the CSA be excused from further attendance but be notified of the date of handing down of judgment. I accept the conduct of the CSA cannot be a relevant factor under s.117(2A)(c). However, I also note that the CSA initially paid for the transcript to facilitate the appeal process in circumstances where ordinarily a party would have to pay that expense.
Section s.117(2A)(c) expressly refers to ‘pleadings’ and ‘production of documents’.
Under reg 25A.05(1) of the Federal Magistrates Court Rules 2001 the appellant must attach to the notice of appeal a copy of the SSAT’s decision and the statement of reasons for that decision. There is no requirement that the appellant provide to the Court a transcript of the SSAT proceeding. However, the appellant bears the burden of satisfying the Court that the SSAT made an error of law and he must produce all material that is necessary to establish his case.
The transcript was not originally provided. At the outset, the claims in the appellant’s notice of appeal suggested that the transcript may be required. In the notice of Appeal the appellant claimed, amongst other things, that the SSAT:
a)Failed to consider the evidence or make findings of fact in relation to the evidence;
b)Refused to admit S’ affidavit relevant to the issues before the Tribunal; and
c)Failed to consider the evidence in reaching its conclusions and held itself bound to the Federal Magistrate’s findings made in 2006 in respect of different evidence and circumstances.
The grounds of appeal did not identify the particulars of the appellant’s complaints. This required the Court to deal with the issues raised by the appellant rather than the appeal grounds as pleaded: see Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 at para [4].
The CSA submits that it was doubtful that the transcript was necessary for the Court to determine the appeal. The CSA submitted that the reasons in Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 did not refer to the transcript but were made on the basis of the SSAT’s reasons and the submissions of the parties. This is not correct. One of the substantive issues on appeal was the cost of the adult child, S. The reasons referred to the transcript as well as its page references in reviewing the appellant’s evidence on what S used her own income for: see para.[40] of the reasons. It was noted that the SSAT made no findings as to whether S could be reasonably expected to contribute financially for the household. I found the SSAT’s failure to fully deal with the issues relating to S was an error: see Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 at paras.[41]-[42.]
While the CSA points to the appellant’s conduct, namely the way he had framed his grounds of appeal so as to suggest that matters of evidence were challenged, it is important to note that the appellant was a self-represented litigant. In particular, I note at para.[8] of the reasons it was stated that this was a difficult child support case on earning capacity, with complex overlays relating to school fees, an adult child and after school care.
In its submissions, the CSA state that the circumstances that have generally been found to warrant departure from the general rule in s.117(1) include where a party ‘has acted in a dishonest or less than candid manner in the litigation, has made fraudulent or unwarranted claims or allegations, has pursued a weak or hopeless case, or has a great financial disparity with the other’. I accept that none of these circumstances apply to the CSA in the proceeding, although I do not accept that the discretion is limited in this way.
Stephen, Mason, Aickin and Wilson JJ in Penfold v Penfold (1980) 144 CLR 311 at 315 stated:
Sub-section (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order. Beyond this there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs. Consequently, with respect to their Honours in the Family Court, we do not agree with the suggestion made in the judgment under appeal that an order can only be made under s.117(2) in "a clear case". (emphasis added)
Carter J of the Family Court in Robbins & Rosemount (No. 2) [2008] FamCA 494 at para.[119] pointed out it was not necessary for the Court to be satisfied there is a ‘clear case’ or ‘an exceptional case’ in order to depart from the general rule and make an order for costs.
As is made clear in Penfold, the Court does not have to be satisfied that there is a “clear case” or an “exceptional case”. The requirement is that there are matters in the combination of s 117(2) and (2A) which “justify” the conclusion that costs should be ordered. Section 117(1), s117(2) and s117(2A) are interrelated and the overall structure of these subsections is to provide the Court a broad discretion, the exercise of which starts with the general rule in s 117(1).. (emphasis added)
At para.[3.18] of its submissions, the CSA state that the ‘Court’s discretion to award costs pursuant to s.117(2) must be exercised judicially and not arbitrarily or capriciously’. The CSA cited Overton Investments Pty Ltd v Minister Administering the Environmental Planning and Assessment Act 1979 [2001] NSWCA 137 and Oshlack v Richmond River Council (1998) 193 CLR 72 at 81 per Gaudron and Gummow JJ. Whilst I accept this proposition, it is difficult to see how it assists in the exercise of the discretion in this case.
Failure to comply with previous orders of the Court
Neither the proceedings nor transcript costs were necessitated by any parties’ failure to comply with previous Orders of the Court.
Any party wholly unsuccessful in the proceedings
The CSA submits that while the appeal was allowed, the appellant was unsuccessful in respect of 6 out of 7 substantial appeal points raised: see Carlson & Acuff (SSAT Appeal) [2010] FMCAfam 677 at paras.[26], [31], [33], [39], [46], [55] and [78].
Given that his appeal against the SSAT’s decision was allowed, the appellant cannot be regarded as being wholly unsuccessful in the proceedings. With the appeal allowed, the appellant effectively obtained the crucial order that he sought: that the determination of the SSAT be set aside.
As the CSA’s conduct was not a relevant factor, the CSA submits that it cannot be claimed the CSA have been ‘unsuccessful’ in the proceedings. Given that I have accepted this situation is akin to when an application for judicial review is lodged against the decision of a lower court or tribunal, I accept the CSA’s submission in this case, where they did not seek to argue for or against the appeal.
Offers of settlement
Neither party made any offers of settlement to the other.
Any other relevant matters
I accept the CSA’s submission that the appellant’s decision to appeal and incur the costs of obtaining a transcript was independent of any involvement or participation by the CSA.
The CSA also made detailed submissions on the case law concerning the court’s discretion to provide transcript at its own expense in proceedings governed by the Family Law Act. The CSA submitted the case law illustrates that only in ‘exceptional cases’ will a court transfer the responsibility of the transcript’s costs onto itself: Forbes & Beam (2008) 222 FLR 96; [2008] FamCAFC 189. The discretion to order the transcript at the expense of a party not contesting the issues, whilst open, would be uncommon, although I do not think that exceptional circumstances would need to be shown.
Conclusion
This case highlights the fact that appeals from the SSAT, are not covered by the Federal Proceedings (Costs) Act 1981. Appeals from the AAT are so covered: ss.3(1)(g) and (ga), 6 and 7. Had the Act covered this appeal I would have issued the relevant certificate for the transcript costs. This case highlights what appears to be an oversight in implementing the current legislative scheme as the Federal Proceedings (Costs) Act was not amended to cover appeals from the SSAT to the Federal Magistrates Court or the Family Court. This does not prevent the appellant from applying to the Attorney-General for an ex gratia payment, however I have no knowledge of the rules that apply in this regard, nor is it appropriate for me to make any recommendation or comment on an issue that is solely in the province of the Attorney-General.
Ultimately it is not appropriate that the CSA bear the transcript costs in circumstances where it did nothing to cause or encourage the litigation, nor seek to argue for any outcome. Indeed, had the CSA not funded the transcript initially, it appeared that the appellant’s case as set out in his grounds would have been thwarted. That the CSA have acted reasonably in funding the transcript initially does not mean that they should bear the cost.
Ultimately the case is one when the transcript was required for the appellant to pursue the grounds in the notice of appeal. Prima facie the appellant should have provided the transcript and should reimburse the CSA for the outlay in the circumstances of this case.
The more difficult question is whether the appellant should obtain an order for costs against the respondent. Having regard to the use ultimately made of the transcript, and the circumstances of this case I am not persuaded that the respondent should be ordered to pay the appellant’s costs of the transcript.
I certify that the preceding thirty-seven (37) paragraphs are a true copy of the reasons for judgment of Riethmuller FM
Date: 5 October 2010
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