Cerny and Seidler (No 2)

FAMILY COURT OF AUSTRALIA

CERNY & SEIDLER (NO. 2)

[2019] FamCA 381

FAMILY LAW – PRACTICE AND PROCEDURE – SLIP RULE – Where a correction of orders is sought under the Slip Rule – Where the Court found it appropriate to grant some amendments and not others – Orders amended as appropriate.

FAMILY LAW – COSTS – Where the wife sought an order for Costs – Where the husband’s conduct in prosecuting the proceedings caused the wife to incur costs over and above the amount she normally would have – Where the father was at times unrepresented and benefited from the mother’s legal representation – Where the husband is in a stronger financial position than the wife – Where litigation is in its fifth year and it would be in the interests of the parties for the Court to make an assessment of costs – Order made for the husband to pay Costs in the fixed sum of $80,000.

Child Support (Assessment) Act 1989 (Cth) ss 116, 124
Family Law Act 1975 (Cth) ss 116, 117

Colgate Palmolive Co and Another v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225
Gludau & Gludau (No. 2) [2013] FamCAFC 181
Munday v Bowman (1997) FLC 92-784

APPLICANT:

Mr Cerny

RESPONDENT:

Ms Seidler

FILE NUMBER:

SYC

6696

of

2014

DATE DELIVERED:

13 June 2019

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Loughnan J

HEARING DATE:

28 May 2019

REPRESENTATION

COUNSEL FOR THE HUSBAND:

Mr A Paterson

SOLICITOR FOR THE HUSBAND:

Family Law 4 Men

COUNSEL FOR THE MOTHER:

Mr G Gould

SOLICITOR FOR THE MOTHER:

Karras Partners Lawyers

Orders

The father is to pay to the solicitor for the mother $80,000 by way of costs, within 21 days of the date of payment to him pursuant to Order (3)(k) made on 30 January 2019 as amended or within such other time as the parties might agree upon in writing.

Note: The form of the order is subject to the entry of the order in the Court’s records.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Cerny & Seidler has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC6696 of 2014

Mr Cerny

Applicant

And

Ms Seidler

Respondent

REASONS FOR JUDGMENT

Parenting and financial orders were made by me on 30 January 2019 in proceedings between Ms Seidler and Mr Cerny following a final hearing that concluded on 13 December 2018. The parties are variously referred to as “the mother” and “the wife” and as “the father” and “the husband” respectively. On 28 May 2019 I heard applications for the correction of the orders made on 30 January 2019 and for machinery orders in respect of the sale of a property. For reasons given on that day, I made orders in respect of the machinery issues. I also made orders to correct the orders of 30 January 2019 pursuant to the slip rule. Set out below are the reasons for those orders.
The mother sought orders for the costs of the substantive proceedings and of various ancillary applications. Set out below are the reasons for the costs order set out above.

The Orders of 28 May 2019

On 28 May 2019 the following orders were made:
(1)Leave is granted to the parties and their legal representatives to inspect documents produced to the Court by the husband.
(2)By consent, orders and notations are made in accordance with the document titled “Consent Orders” (Exhibit 5 dated 28 May 2019), as set out hereunder:
Recitals
A.On 27 August 2015 the respondent husband was ordered to pay the wife’s costs.
B.The wife has agreed to accept the sum of $6,000 in full satisfaction of the costs order.
By consent order that:
1.The husband is to pay the wife the sum of $6,000 in full satisfaction of the costs order made against him on 27 August 2015 which such amount to be paid as part of final settlement of property of the parties prior to any distribution to the husband from the sale proceeds, or upon transfer of the property from the wife to the husband.
(3)By way of machinery order to give effect to the sale of the property at [F Street, Suburb G] in the State of New South Wales ordered at paragraph 3 of the orders made on 30 January 2019, orders are made in terms of paragraphs 2 and 3 of Exhibit 1 as amended and as set out hereunder:
2.That the wife continue to do all things and sign all documents to ensure that the matrimonial home at [F Street, Suburb G] continues to be listed for sale by private treaty at a price of $2.5 million until 30 September 2019.
3.That in the event that the property has not been sold by 30 September 2019 then the wife is to do all things and sign all documents necessary to ensure the property is listed for the first available auction thereafter at a reserve price of $2.4 million.
(4)Pursuant to Rule 17.02 the orders made on 30 January 2019 are amended by deleting from Order 3(c) the words appearing after “AJ80…” and by deleting sub paragraph (e) from that Order.
(5)As a result of order (4) above, the following consequential amendments are made to the stay of the orders made on 30 January 2019, ordered on 7 March 2019:
(a)Order (1)(i) is amended by deleting all of the words appearing after the word “only”.
(b)Order (1)(iv) and (v) are deleted.
(6)The operation of Order 3 made on 30 January 2019 as amended above is to otherwise continue, mutatis mutandis.
(7)Pursuant to Rule 17.02, Order 6 made on 30 January 2019 is amended by adding the words and figures “until 29 February 2020” after the words “Child Support Departure Order”.
(8)Otherwise the applications of the parties under the slip rule in respect of the orders of 30 January 2019 are dismissed.
(9)The husband’s solicitor is to provide to the wife’s solicitor and the associate to Justice Loughnan by the close of business on Friday 31 May 2019 a reference to any evidence of the husband in response to the affidavit of the wife sworn 8 June 2016 together with any submissions in relation to the purpose of a costs order being compensatory rather than punitive. Otherwise judgment is reserved on the wife’s costs application.
(10)The parties are at liberty to approach the chambers of Justice Loughnan with terms resolving the issue reserved or in the matter generally on giving seven days’ notice to each other and the associate to Justice Loughnan. In the event that substantive orders are pressed on a contested basis, that leave is to be exercised by the filing of an Application in a Case supported by affidavit.

The Slip Rule Applications

What follows are the reasons for the slip rule orders made on 28 May 2019.

The Relevant Law

The Family Court of Australia is able to correct errors, among others, made in the terms of its orders. Where an accidental slip or omission is made by the Court (or a party or representative) leading to an error in the published Court orders, the error can be corrected in certain circumstances. That facility is common to courts and is referred to as “the Slip Rule”. The rule finds expression for this Court[1] in rr 17.02(1)(g) and (h) of the Family Law Rules 2004. Rule 17.02 provides as follows:
[1] There is a nice question about whether rule 17.02 represents the limits of the Court’s slip rule power or whether such a power is incidental to or inherent in, at least some Courts. It is not necessary to explore that issue in these reasons. The matter was argued on the basis of the expressions in rr 17.02 and 17.02A.
Varying or setting aside orders
(1) The court may at any time vary or set aside an order, if:
(a) it was made in the absence of a party; or
(b) it was obtained by fraud; or
(c) it is interlocutory; or
(d) it is an injunction or for the appointment of a receiver; or
(e) it does not reflect the intention of the court; or
(f) the party in whose favour it was made consents ; or
(g) there is a clerical mistake in the order; or

(h) there is an error arising in the order from an accidental slip or omission.

(2) Subrule (1) does not affect the power of the court to vary or terminate the operation of an order by a further order.

The mother’s application under the slip rule relies on r 17.02A which provides as follows:
Varying or setting aside reasons for judgment
The court may, at any time:
(a) vary or set aside reasons for judgment if the reasons were issued by mistake; or
(b) correct a clerical mistake in reasons for judgment, or an error arising in reasons for judgment from any accidental slip or omission.
In Gludau & Gludau (No. 2) [2013] FamCAFC 181 the Full Court (Murphy J with whom May & Hogan JJ agreed) discussed the slip rule in the context of this Court:
(b)Correction Under the “ Slip Rule”
15.The High Court in McCormack following the earlier decision of that court in L Shaddock held (at 277) that:
...there is jurisdiction to make an appropriate order under [the slip rule] to remedy the situation which has arisen as a result of oversight by a party’s legal representative notwithstanding the fact that the formal orders have been taken out...
16.In SMK Pty Ltd v Milan Kramer[1995] FCA 1616 the Full Court of the Federal Court held that:
4.The defendant, the successful appellant in the Full Court, seeks an order pursuant to O.35, r.7(3), the slip rule , which provides that a clerical mistake or any error from an accidental slip or omission in an order or judgment may be corrected by the Court. It has been held that counsel’s inadvertence falls within the equivalent rule in the High Court rules: see L Shaddock and Associates Pty Ltd v Parramatta City Council No. 2[1982] HCA 59; (1982) 151 CLR 590 which decision was followed in the Commonwealth of Australia v McCormack[1984] HCA 57; (1984) 155 CLR 273 where the Court pointed out (276), that ordinarily a successful appellant would be entitled to orders for repayment...
5....There seems little doubt that the Full Court, had it been apprised of the payment of moneys, would have ordered repayment of them. The defendant also seeks an order for interest from the date they were paid to the plaintiff which is to be taken as 11 July 1994 to today’s date. In McCormack the Court considered that the slip rule was the appropriate rule to apply to such circumstances and it appears clear from that decision that the Court considered that the question of the quantum of the repayment ought to be approached on restitutionary principles....
17.Within the context of finding that this court had no power to reopen an appeal to correct an error of law once orders in the appeal had been perfected, the majority in DJL v The Central Authority (2000) 201 CLR 226 held, at [28]:
Order 31 of the Family Law Rules is headed “decrees”. The term “decree” is defined in s 4(1) of the Family Law Act as meaning “decree, judgment or order” and as including “a decree nisi and an order dismissing an application or refusing to make a decree or order”. Order 31, r 5 states:
“Except where the court or a Registrar otherwise directs, all decrees, warrants and recognizances made under the [Family Law] Act, the [Family Law] Regulations or these Rules shall be drawn up and signed by the Registrar of the filing registry.”
Rule 6 provides for the rectification by the registrar of any error “that appears on the face of a decree” and for the rectification of the formal record of a decree where it contains an error appearing to arise “from an accidental slip or omission” (O 31, r 6(3)). This “slip rule” includes a power to “make or give such consequential orders or directions as may be necessary to ensure that justice is done between the parties” (O 31, r 6(4)(b)). However, it is not suggested that O 31 confers a power of the nature necessary to set aside a decree after entry for error of law in the reasons for judgment founding the decree. Nor was this court referred to any other provision of the legislation directly and expressly conferring such a power.
18.As the Court there refers to, the “ slip rule ” as it then appeared in the Family Law Rules 1984 (Cth) was contained within Order 31 and provided for correction of error by a Registrar and, “...in a case of doubt or where it appears that the error arises from an accidental slip or omission...”, reference to, relevantly, a Judge upon notice. The then rule went on to provide, as the High Court refers to:
(4) Where a decree is referred under sub-rule (3), the Judge...to whom it is referred-
(a) may rectify the decree, without an appeal; and
(b) may make or give such consequential orders or directions as may be necessary to ensure that justice is done between the parties.
19.The “ slip rule ” in its current form (r 17.02) provides, like its predecessor, for reference to a Registrar but only so as to “...rectify an error that appears obvious on reading the order.” Like its predecessor the Rule provides for referral to a “judicial officer” upon notice but, when that occurs, the Rule goes on to provide the power that the judicial officer may exercise:
(5) A judicial officer may, after giving each party a reasonable opportunity to be heard, rectify a suspected error referred to the judicial officer.
Note: An amendment of an order may be made under this rule only if it is an error obvious when reading the order. Any other amendment must be remedied by appeal or consent.
20.The rule in its current form, particularly when regard is given to its accompanying note, is arguably significantly more restrictive of the “ slip rule ” powers exercisable by a judge of this court than those to which the High Court referred in DJL. Indeed, as the High Court said more recently in Burrell v The Queen[2008] HCA 34; (2008) 238 CLR 218, at 224 – 225 per Gummow A-CJ; Hayne, Heydon, Crennan and Kiefel JJ:
20.Identifying the formal recording of the order of a superior court of record as the point at which that court’s power to reconsider the matter is at an end provides a readily ascertainable and easily applied criterion. But more than that, identifying the formal recording of the order as the watershed both marks the end of the litigation in that court, and provides conclusive certainty about what was the end result in that court.
21.The power to correct the record so that it truly does represent what the court pronounced or intended to pronounce as its order [L Shaddock & Associates Pty Ltd v Parramatta City Council [No 2][1982] HCA 59; (1982) 151 CLR 590 at 594-595] provides no substantial qualification to that rule. The power to correct an error arising from accidental slip or omission, whether under a specific rule of court or otherwise, directs attention to what the court whose record is to be corrected did or intended to do. It does not permit reconsideration, let alone alteration, of the substance of the result that was reached and recorded.
(Bold emphasis added).
21.The current rule might, then, be argued to be reflective of the concern that the Rules must embody the fact that this court is a creature of statute within a constitutional framework and its powers on appeal derive from statute. In particular, while the “ slip rule ” might be used to correct obvious errors (perhaps what Kirby J referred to in DJL as “accidental mistakes or omissions of no substantive significance” or an “accidental slip or omission” as the plurality in Burrell referred to), care must be taken when the nature of the asserted error is substantive, as that may in fact involve the exercise of a power to reopen proceedings that are completed by a perfected order and that is a power which this court does not have (see, DJL).

The father’s slip rule applications:

Orders 3(c) and (e)

Order 3 made on 30 January 2019 reads as follows:
(3)Within three months of the date of these Orders (but not before 1 March 2019) the mother is to take all necessary steps and execute all necessary documents to cause the property situated at and known as [F Street, Suburb G] being the whole of the property contained in Certificate of Title Folio Identifier 2/...… to be listed for sale by public auction at the earliest possible date with the reserve price to be $2,800,000 or as otherwise agreed upon between the parties in writing, and that the proceeds of the said sale be dispersed as follows:
(a)in payment of agent’s commission and any fees on sale;
(b)in payment of legal costs and disbursements of the sale;
(c)in discharge of the mortgage to Westpac Banking Corporation being registered dealing no. …63 and Westpac Banking Corporation loan #...18;
(d)in payment of the Capital Gains Tax payable by the mother in relation to the sale of the property and to give effect to this Order the sum of $100,000 (or as otherwise agreed by the parties in writing) is to be held in the trust account of Karras Partners Lawyers or a joint controlled monies account held on behalf of the parties by the conveyancing lawyer as the parties may agree, with the Capital Gains Tax liability to be paid from that account and the balance thereafter (if any) to be divided between the parties in the proportions 60 per cent to the mother and 40 per cent to the father;
(e)in discharge of Westpac Bank loan #…69 in the name of Ms and Mr H;
(f)in payment to Mr J of $75,000;
(g)in payment of $25,000 to the K Bank #…26 in the name of the mother;
(h)in payment of $67,000 to the K Bank Loan #…18 in the name of the father;
(i)in payment of $99,970 to the L Bank Unsecured Loan #…66 in the name of the father;
(j)in payment of 60 per cent of the remaining proceeds to the mother; and
(k)in payment of the balance of the net proceeds to the father.
The father’s contention is that the judgment makes plain that the intention of the Court was to exclude from the relevant net pool of assets, certain debts and that without any explanation, two of those debts were included in the orders. The debts in question are one of the debts referred to in order 3(c) being “Westpac Banking Corporation loan #…18” and the debt referred to in order 3(e).
The mother contends that the father’s application is controversial and as such, that it falls outside what the authorities would allow as a slip rule issue.
The debts in question were items 26 and 28 in the joint balance sheet set out at paragraph 133 of the reasons for judgment. The controversy about those debts was dealt with in the reasons as follows:
Items 26, 28, 29 & 30
137.It is the mother’s case that these items are, or are substantially, liabilities incurred by her or on her behalf for her legal fees in these proceedings. I indicated to the parties on the first day of the trial that it was my inclination, in accordance with accepted practice, to omit the parties’ legal fees and the debts incurred for that purpose, from the balance sheet used to identify and value the net assets of the marriage. The reason for that is to avoid one party contributing to the costs of the other before and outside any consideration under s 117 of the Act. On the evidence it is not possible to identify or distinguish parts of those liabilities that were not incurred for the mother’s costs. I will exclude all of the liabilities. That approach is required by the lack of evidence in the mother’s case and cannot disadvantage the father.
The resultant table at paragraph 142 of the judgment, setting out the net assets of the parties, omitted those liabilities.
The intended effect of the orders was addressed in the reasons for judgment commencing at paragraph 208. Nowhere in the reasons is there an indication that the debts at items 26 and 28 of the joint balance sheet would be paid out of joint funds. Indeed that order is inconsistent with the rationale set out in paragraph 137 of the judgment and with the intended outcome set out at paragraph 208.

In the reasons for judgment reference was made[2] to basing the orders on the style of orders proposed on behalf of the mother and as was submitted on behalf of the father, it is highly likely that the error was made when those provisions were uncritically adopted as the formal orders of the Court. In any event the inclusion of paragraphs (c) and (e) in order 3 was accidental and in error and those paragraphs will be removed under r 17.02.
[2] Paragraph 215 of the reasons for judgment

The reference to the Mortgage to Westpac Banking Corporation in order 3(c)

The father’s contention is that reference to the liability should be amended under the slip rule to “The Westpac Banking Corporation loan account #…18”.
Again, the submission for the mother is that the father’s application is controversial and that the proposed amendment should not be permitted under the slip rule.
I think that the father’s concern relates to the potential for the amount paid out under 3(c) to increase from the figure provided for the purposes of the trial. That said, the harm is theoretical. Further, the mother is on notice of the father’s concerns and she would be aware that any increase in the mortgage is likely to draw complaint from the father and result in further litigation. As it happens, one of the terms of the stay order made on 7 March 2019 was:
…
iii.The mother is restrained from further encumbering the property at [F Street, Suburb G] in any way other than by the Westpac Loan #…98;
As I understand the father’s concern, that order seems to address the issue, at least for the duration of the stay.
Finally, there was no reference to this in the reasons for judgment and it cannot be said that the wording of the orders resulted from an accidental slip or omission. The father’s application must fail.

Order 6 should be amended to limit the duration of the departure order to 29 February 2020

The father’s contention is that the reasons for judgment indicate the departure order is limited to the duration of the current child support assessment and that fact should be specified in the order.
Again, the submission for the mother is that the father’s application is controversial. It is also argued that the indefinite wording of the order was supported by the reasons for judgment. In any event the mother submits that the proposed amendment should not be permitted under the slip rule.
Order 6 is as follows:
(6)By way of Child Support Departure Order the father shall pay child support to the mother in respect of the child, [D], as a periodic sum of $300 per week with the first payment to be made within seven days of these Orders and thereafter such funds to be deposited weekly into a bank account nominated by the mother in writing.
Relevantly in the reasons for judgment there was the following paragraph:
232.I will make the orders in the terms proposed by the mother. As the departure was not expressed to be sought for a specified period, it will only apply to the current assessment which applies until 29 February 2020. It is probably for that reason that the mother has not sought any provision for the liability to increase with movements in the CPI.
Learned counsel for the mother referred to paragraph 218 of the reasons for judgment and submitted that that paragraph indicated that the Court was minded to make an indefinite order because I opined that the parties could not efficiently navigate the administrative scheme. The suggestion being that I was flagging that an indefinite order was required rather than one that put the parties back under the administrative scheme in February 2020.
The problem with the argument made on behalf of the mother is that paragraph 218 was concerned with a jurisdictional issue involving s 116 of the Child Support (Assessment) Act 1989 (Cth) (“the Assessment Act”). That is made plain when paragraphs 217 and 218 are read together. They are:
217.This Court has no direct jurisdiction in relation to child support departure. Once there is an assessment of child support the Court’s power is to review decisions made at the end of a chain of administrative decisions by the Administrative Appeals Tribunal (“AAT”) and there are limits to that power. However s 116 of the Child Support (Assessment) Act 1989 (Cth) (“the Assessment Act”) provides that if the Court finds that there are proceedings between the payer and the payee and that it will be in the interests of both of them to make a departure decision, then notwithstanding that the parties have not undergone the processes of the administrative scheme, the Court may make an order.
218.Here there are relevant proceedings. The parties have made heavy weather of what should have been a relatively straightforward family law dispute. For that reason I am concerned that they might not be able to efficiently manage the administrative scheme’s mechanisms for departure. For the purposes of the property settlement proceedings the parties have provided disclosure about their financial circumstances. They have been able to reach accommodations about certain non-agency payments. As it transpires, the range of dispute in respect of the father’s recurrent liability is a narrow one. In my view it would be in the interests of the parents if the Court determines the mother’s departure application notwithstanding that the departure procedures under the administrative scheme have not been completed.
There was a discretion to exercise if s 116 was to be invoked and paragraph 218 went to that issue. The question of the duration of the departure order was addressed later in the reasons as follows:
232.I will make the orders in the terms proposed by the mother. As the departure was not expressed to be sought for a specified period, it will only apply to the current assessment which applies until 29 February 2020. It is probably for that reason that the mother has not sought any provision for the liability to increase with movements in the CPI.
Finally, it was submitted that as the orders under s 124 of the Assessment Act were made on an indefinite basis, it could be inferred that the Court intended the same for the departure order under s 117 of that Act. I disagree. In any event the issue is contestable.
A departure order necessarily involves a departure from an assessment of child support. In this case the assessment issued for the period ending on 29 February 2020. The reasons for judgment make plain that the intention was that the departure apply for the duration of the current assessment. As I noted, the mother did not expressly seek that the departure apply beyond the current assessment and the fact that no CPI increases were sought by her, seemed consistent with the assumption that she intended the departure to only apply to that assessment. Of course I may have been wrong about those assumptions. However, the reasons for judgment are clear and are not reflected in the orders. Therefore it is appropriate to make the correction sought on behalf of the father.

Paragraphs 133 & 142 of the reasons for judgment

It is the mother’s contention that the Court did not intend to include in the balance sheet $59,105 held in the trust account of the mother’s solicitors because they were borrowed funds. The mother’s contention is that the reasons for judgment should be corrected along with the resultant orders.
The father opposes the amendment. In particular it is submitted that by including these funds in her draft balance sheet, the mother effectively conceded that they should be included as I have done in the balance sheet settled for the purposes of the property settlement. The submission goes on that the mother should not be permitted to resile from her earlier concession. The problem with that submission is that the mother also argued that certain borrowings be included in the balance sheet.
However, the difficulty with the slip rule application in relation to this item is that there is no clear conflict between the reasons for judgment and the order in question. In those circumstances there can be a debate about what was intended and therefore it is not clear that there was a slip amenable to rr 17.02 and 17.02A of the Family Law Rules 2004. The latter provision permits the correction of slips in reasons for judgment.
As I said to the parties during the course of submissions, the mother is no doubt correct that I should have either omitted the moneys held on trust or have balanced them with the associated borrowing. That would be logical and consistent with the principle of leaving arguments about costs to be determined after the property settlement exercise and pursuant to s 117 of the Family Law Act 1975 (Cth) (“the Act”). In that way the liabilities for legal fees are commonly ignored in constructing the balance sheet. I said as much in paragraph 137 of the judgment. To do otherwise would be like including real estate in the balance sheet and ignoring a debt secured on that property. However, in this instance moneys being held against legal fees were included in the balance sheet without the associated borrowing being also included and unfortunately I did not set out the above rationale in the reasons for judgment.
While I am confident that the mother’s interpretation is correct and that it would be so found if this issue came to appellate attention, in my view the ability to correct the reasons and the consequential impact of that error on the ultimate orders cannot be found in the slip rule. During submissions I invited the parties to address this matter by an agreed amendment.

The consequences of the slip rule orders for the stay orders made 7 March 2019

The r 17.02 decisions have a bearing on the orders of 30 January 2019. They also impact stay orders made on 7 March 2019. As was noted[3] on 7 March 2019, it was anticipated that any amendments made under the slip rule to Order 3 made on 30 January 2019 would impact on the stay ordered on 7 March 2019 in relation to the earlier order. The stay came about because, in addition to his application under the slip rule, the father has appealed against some of the orders made on 30 January 2019. The orders of 7 March 2019 were as follows:
[3] Paragraph 2 of the Orders of 7 March 2019
(1)Pending the determination of the appeals commenced by Notices of Appeal filed on behalf of the father 22 February 2019 the following orders of 30 January 2019 are stayed on these terms:
i.Order 3(c) is varied to provide:
(c)In discharge of the mortgage to the Westpac Banking Corporation being registered dealing number …63 relating to Westpac Loan #…98 only and that the funds required to discharge Westpac Banking Corporation loan #…18 be held in a controlled monies account by the conveyancing solicitor;
ii.The mother is restrained from allowing the balance of the Westpac Loan #…98 to increase above $1,319,542;
iii.The mother is restrained from further encumbering the property at F Street, Suburb G in any way other than by the Westpac Loan #…98;
iv.Order 3 (e) is varied to provide:
(e)In paying an amount sufficient to discharge the Westpac Loan #…69 into a controlled monies account by the conveyancing solicitor;
v.The mother is restrained from allowing the balances of the Westpac Loans #…18 and #…69 to increase above $94,161 and $149,936, respectively.
(2)It is noted that the issue of whether or not Westpac loans #…18 and #…69 must be paid out of the sale proceeds of the Suburb G property may be finalised on determination of the father’s slip rule application.
(3)Otherwise, the father’s application filed on 30 January 2019 is dismissed.
(4)Leave is granted to the parties to apply within 28 days, on giving at least seven days’ notice to the Court and each other, in relation to the wording of these orders.
I included in the orders of 28 May 2019 the necessary consequential amendments to the orders of 7 March 2019.

Costs

The mother relevantly seeks:
1.That the husband pay the wife’s costs of the parenting proceedings from 7 June 2018 until 30 January 2019 as agreed between the parties or failing agreement, as assessed.
2.That the husband pay 50% of the wife’s costs from 18 May 2015 to 30 January 2019 as agreed between the parties or as assessed.
3That the costs referred to in Orders 1 and 2 be paid within 28 days of agreement or within 28 days of the date of assessment.
4.That the husband pay the costs of this application.
5.….
By her affidavit sworn 27 February 2019 the mother makes plain that she did not intend that orders 1 and 2 would overlap. I take it that she seeks that the husband pay:
(a)her costs incurred in the parenting proceedings from 7 June 2018 to 30 January 2019 and that those costs be calculated on an indemnity basis; and
(b)fifty per cent of the costs she incurred in the parenting and financial proceedings from 18 May 2015 to 30 January 2019 (but excluding any of the costs covered by (a)) and that those costs be also calculated on an indemnity basis.
The relevance of 7 June 2018 in the first paragraph is said to be that it was the day on which a letter was sent to the husband attaching a minute of proposed parenting orders. The relevance of 18 May 2015 in the second paragraph is said to be that it is the day on which the father became self-represented.
The father opposes any order for costs being made against him.
Costs applications are decided by reference to s 117 of the Act. Section 117 relevantly provides:
Costs
(1) Subject to subsection (2), subsections 45A(6) and 70NFB(1) and sections 117AA and 117AC, each party to proceedings under this Act shall bear his or her own 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), (4A), (5) and (6) 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.
(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.
…
As to the basis for the calculation of the costs claimed by the mother, she seeks that the costs be awarded on an indemnity basis. That is not apparent from her application but is made clear in the submissions filed on her behalf. There was only belated compliance with r 19.08(3) but the relevant costs agreements[4] were handed up on the day.
[4] Exhibit 4
The Family Law Rules 2004 address the quantification of costs at r 19.18 as follows:
19.18 Method of calculation of costs
(1)The court may order that a party is entitled to costs:
(a)of a specific amount;
(b)as assessed on a particular basis (eg lawyer and client, party/party or indemnity);
(c)to be calculated in accordance with the method stated in the order; or
(d)for part of the case, or part of an amount, assessed in accordance with Schedule 3.
Example: For paragraph (1)(c), the stated method may be in accordance with Schedule 3 but with an additional percentage for complexity.
(2)If costs are payable under the Act or these Rules, or the court orders that costs be paid and does not specify the method for their calculation, the costs are to be assessed on a party/party basis.
(3)In making an order under subrule (1), the court may consider:
(a)the importance, complexity or difficulty of the issues;
(b)the reasonableness of each party’s behaviour in the case;
(c)the rates ordinarily payable to lawyers in comparable cases;
(d)whether a lawyer’s conduct has been improper or unreasonable;
(e)the time properly spent on the case, or in complying with pre‑action procedures; and
(f)expenses properly paid or payable.
The mother’s costs were $384,182.54[5]. The father’s costs were $159,856[6].
[5] Undated Costs Notice apparently prepared for 14 May 2019 – exhibit 3. That is likely to understate the costs as 14 May 2019 was adjourned to 28 May 2019.
[6] Paragraph 87 of the larger of two affidavits affirmed by the father on 8 May 2019
I take it that the mother’s costs include the costs of ancillary applications. Rather than seek to disaggregate the costs of those applications, I will treat them as costs in the cause.
Dealing with the relevant matters referred to in s 117 (2A) of the Act:

The financial circumstances of the parties

The Suburb G property has not been sold and therefore the practical outcome of the property settlement orders is not known. Each of the parties has speculated about the outcome on the basis of various assumptions both about the ultimate sale price of the property and the outcome of the slip rule proceedings. I understand that there remain appeal proceedings on foot that could also have an impact on the financial circumstances of the parties.
The mother contends[7] on the basis of the father’s slip rule challenges to order 3 of 30 January 2019 being successful, that in addition to 60 per cent of any remainder of the funds set aside for capital gains tax, she will receive $70,953.85 on a sale price of $2.5 million, $12,075.08 on a sale price of $2.4 million and will be left with a debt of $46,803 on a sale price of $2.3 million. The father concedes in his affidavit sworn 10 May 2019 that after payment of all of her debts the mother will receive only a small amount from the sale of the Suburb G property.
[7] Paragraph 20 of the mother’s affidavit affirmed 9 May 2019
The father deposes[8] that following the sale of the Suburb G property and paying all of his debts he will be left in a net debt position.
[8] Paragraph 23 of the father’s affidavit affirmed 10 May 2019
There was no application to cross-examine either of the parties and where the parties have given evidence in these interlocutory proceedings, I am largely left with that conflicting evidence. There is additional evidence about the father’s financial position in a successful application for finance made by him[9]. The father has approval for a facility limited to $1,980,044 for the purposes of purchasing the Suburb G property at $2.3 million. The finance approval was conditional on proof of rental income being available from the property of at least $69,000 per annum and proof of his income. In the application the father disclosed an income of $325,495 per annum (a pre-tax income of over $27,000 per month) in addition to his estimate of future rent. The father disclosed a rental commitment of $3,345 per month and estimated his total living expenses, excluding loan repayments, at $6,694 per month. The father disclosed having $61,358 credit in a bank account and $105,754 in superannuation. In addition to two car leases the father disclosed about $200,000 in other debts and $30,000 owing on a credit card.
[9] Exhibit 2 – loan application and approval from the Bank of Queensland.

I take it that the father’s loan approval will allow him to pay out the mother in order to complete the purchase.
The mother provided no recent evidence about her financial circumstances. In the course of the reasons for judgment published on 30 January 2019 the following findings were made:
175.The mother’s weekly income is $5,367 made up of $2,307 in wages from [UU Ltd], $200 in rent, $2,740 from her [WW Business] and $120 in child support. The mother has a tenant but does not otherwise live with an income earner.
176.The mother’s professional income is currently at a greater rate, $5,047 per week or over $260,000 per annum, than her income for the 2017/2018 year which was $181,000. The evidence about the mother’s assets and liabilities is set out earlier in these reasons.
…
226.Omitting the rent, the mother’s income is $5,167 made up of $2,307 in wages, $2,740 in income from her [WW Business] and $120 in child support. I was not told why the father pays $136 per week in child support and yet the mother only receives $120. It is even more puzzling given that the assessed rate is about $143 per week. The mother estimates her liabilities at $9,200 per week. That represents a weekly shortfall of over $4,000. In the future the mother plans to apply the money she currently pays on the mortgage, to her rent. Hopefully some of her unsecured debts will also be discharged from her property settlement. The mother was not cross‑examined about the repayments she makes on her Visa card. At $3,230 per week the repayments seem high. I assume that the repayments include ongoing weekly expenditure on the card/s that is in addition to the required repayments and in addition to the expenditure of $1,445 per week identified at Part N of her Financial Statement. The mother’s Financial Statement makes no reference to the American Express debt claimed by her in the property settlement proceedings. The Financial Statement puts the Visa card debt at $47,000, while the mother’s evidence in the property settlement proceedings put the Visa card debt at over $43,000 and the related American Express debt at $10,000. I assume that the combined current credit card debt is over $53,000. Again, hopefully that debt can be extinguished from the mother’s property settlement. Relief from those credit card payments would go some way towards reducing the very substantial shortfall in the mother’s weekly budget. Even without apportioning the other fixed expenses, the mother estimates that she spends and will spend $1,377 per week on D. I am satisfied that there is a substantially greater shortfall in the mother’s weekly budget for D’s expenses than the amount she claims.
The Suburb G property failed to sell at $2.8 million which was the figure specified in the orders. There being no other agreement between the parties the property was passed in at auction on a vendor’s bid of $2.5 million. That suggests that the optimistic tone of paragraph 226 of the reasons is unlikely to be borne out.
On the basis of what is known at this stage, if either of the parties is to come out of the property settlement in credit, that is more likely to be the father.
The father’s income is significantly greater than that of the mother.
The father is in better financial circumstances than the mother.

The conduct of the proceedings

Section 117 (2A)(c) does not address conduct at large but conduct in the course of prosecuting the proceedings. This is an important element of the mother’s claim. It is submitted for the mother that the father’s carriage of the proceedings added to her costs. The mother’s counsel referred to comments I made during the trial and in the course of reasons for judgment in the substantive proceedings. In particular there were the following passages of the judgment:
13.The father, who was self-represented, filed a trial affidavit containing 1,139 paragraphs which are set out on 145 pages. It is not a helpful document and is not assisted by the 25 page Case Outline Document nor the 48 page Summary of Argument. The presentation of the affidavit with underlining, italicising, capitalising and bolding of some text (and in some instances a combination of those effects) only serves to distract the reader. Happily a practical approach was adopted by counsel for D and for the mother and no formal objections were taken. The process of dealing with formal objections would have exhausted much of the available trial time.
14.Unfortunately that left a situation where it was not clear during the trial what of the father’s written evidence would be taken into account and what would not. Counsel for the ICL and for the mother were obliged to canvass some of the most serious contentions in cross-examination. In respect of the parenting proceedings, Division 12A of Part VII of the Family Law Act 1975 (Cth) (“the Act”) provides relief from some of the exclusionary rules of evidence but the key rules remain. Evidence must be relevant and admissible. Section 55(1) of the Evidence Act 1995 (Cth) provides that:
The evidence that is relevant in a proceeding is evidence that, if it were accepted, could rationally affect (directly or indirectly) the assessment of the probability of the existence of a fact in issue in the proceeding.
15.Luckily the ultimate dispute in the parenting proceedings is of very narrow compass. The only issue is the proportion of time D should spend with each of his parents during the school term. There is no proposal, for example, for supervision of time nor that either parent should be denied overnight time or block periods of time.
16.The father’s affidavit evidence in the parenting case is largely inconsistent with the orders he seeks and many of his answers in cross-examination involved him resiling from and apologising for the contents and tone of his deposition. As it transpired, the evidence the father needed to give in the parenting case could have been contained in a page or two.
17.As to the property proceedings the disputes seem to mainly focus on the approach that should be taken to the presenting facts, rather than on disputes about the facts themselves.
And later in the judgment in a passage addressing s 60CC(3)(d):
95.During his cross-examination [Dr B] said:
I was very concerned when I read the father’s affidavit and his case outline. I was concerned that he used this as an opportunity to be overtly critical of many aspects of the mother’s personality, of her functioning over the years and he stigmatised her experience of mental health problems. It was excessive to my mind and certainly he had approached this task in an obsessive compulsive manner whereby he was going through and essentially with a fine tooth comb hauling through every aspect of the mother’s vulnerability with regard to her emotional state, with regard to her behaviour, with regard to her family of origin experience, with regard to her subsequent relationships and there was an absolute lack of empathy demonstrated in the preparation of this document. This was particularly concerning to me given that the father’s concerns regarding his experience had already been validated.
96.In his enthusiasm to support his case, to respond to criticisms made of him in interlocutory proceedings and to record his frustration and anger about the events on 17 October 2014 and their sequelae, the father has put the lie to much of his case about his contributions to the family. The father gave evidence about supporting the mother through her mental health difficulties early in the marriage. He told [Dr B] that he did not make any adverse inferences from the testing undertaken of the mother for sexually transmitted disease. The father spoke well of the mother’s family. In a repudiation of those representations, the effect of much of the father’s evidence for the trial was to demean, stigmatise and unfairly criticise the mother and the members of her family. At paragraph 45 of the family report [Dr B] reports the following:
He detailed his concerns about the actions of her family members, which included the maternal grandmother’s controlling, overbearing and intrusive presence. He alleged that her brother, [Mr GG] had been angry and abusive, causing her step-brother, [Mr HH], to be fearful.
97.As the father himself submitted, there is no indication that he has behaved in that way in [D’s] presence. [Dr B] said that [D] shows no sign of exposure to the conflict that has supported the litigation between his parents. Hopefully there has been no such exposure. He also said that [D] is a resilient child. I also accept that it would be inconsistent with an apparently unblemished professional life that the father has behaved in that way on a regular basis. That leaves us with him deliberately storing up his knowledge about the mother, her struggles and challenges and his grievances against her and the members of her family and deploying them against her in these proceedings. He apparently did so without appreciating or caring about the impact on the mother of doing so, not to mention the potential impact on [D] of those attacks. All to achieve a forensic advantage in narrowly drawn parenting proceedings. During his questioning of [Dr B] the father compared his affidavit to a PhD thesis.
98.The father submitted that the references made by [Dr B] to obsessive compulsive behaviours and to narcissistic tendencies by him may have been unwarranted and amounted to pathologising his conduct. Although I have no basis for rejecting [Dr B’s] opinions, even if that is right, the conduct itself is of sufficient concern, whatever the label.
99.I gather from the father’s submissions that he would argue that in at least one affidavit filed in interlocutory proceedings the mother behaved as he did in his trial affidavit. I assume that the argument would be that albeit not in a trial affidavit, the mother behaved as badly as he did and that his affidavit, as well as his outline of case and summary of argument, are somehow justified thereby. It is not a very attractive argument (“I am no worse than she is”) but in my view the behaviour was not of the same order. Neither I nor [Dr B] were taken through the detail of the documents. In an unlovely competition, the father must win on volume⁷ but I have not conducted a detailed analysis to make a qualitative comparison of the two affidavits. The background facts suggest that the father’s judgment about these matters is likely to be poor. On the face of it he made a professional standards complaint about Dr BB who was simply meeting a professional obligation. He accused the maternal grandmother of racism for a comment that may have been patronising, incorrect and/or impolite but that was not racist.
⁷The father’s trial affidavit contains 1139 paragraphs of text and there are a significant number of passages making personal criticisms of and attacks on the mother and members of her family. The mother’s trial affidavit has 275 paragraphs and there are only a handful of critical personal references to the father. The mother’s affidavit sworn and filed 23 February 2015 contains 74 paragraphs and there are many paragraphs critical of the father’s conduct but personal criticisms were largely confined to paragraphs 27(d) and 32.
As to the length of the father’s trial affidavit, the father’s counsel submitted and his client deposed[10] that the size of the affidavit arose because the father took the trial direction (which I made on 12 June 2018) requiring the parties to file “one consolidated affidavit from each deponent” to mean that he was to include in his trial affidavit all of the contents of the interlocutory affidavits filed by him in the proceedings. I will simply record that I do not accept that explanation. However, even if I did, the resulting affidavit was not the fault of the mother who incurred costs because of it.
[10] Paragraph 133 of the larger of the father’s affidavits affirmed on 8 May 2019

A party was wholly unsuccessful

It is submitted on behalf of the mother that the father was wholly unsuccessful in aspects of the proceedings. In parenting or property settlement proceedings it can rarely be said that a party was wholly unsuccessful. In my view that is the position here. In the context of a particular stage of proceedings parties can seek or oppose orders for more than one reason. Parties ask for orders based on their apprehension about relevant facts. Those facts may change during the proceedings, rendering the orders sought at any particular stage, no longer relevant.
Even in relation to the child support departure proceedings, the related proceedings in respect of non-periodic payments under s 124 of the Assessment Act could have had a bearing on the parties’ applications.

Settlement discussions in writing

There were written communications in the nature of settlement proposals. Importantly, in order to be meaningful settlement discussions, the communications in question must be clear and unambiguous. Contrary to the submissions made on behalf of the father[11] there is no requirement that a relevant offer be expressed to be “a Calderbank offer”, nor that it bear a statement that failure to accept the offer would be relied on in relation to costs, nor that the offer bear a date until which the offer would remain open. I am not sure why those matters were raised when the offers relied on by the father, save for a letter of 12 June 2018, do not appear to meet all of those asserted requirements.
[11] Commencing with the last paragraph on page 9 of the father’s written submission
The offers relied on by the father were:

A financial offer made by the father on 21 August 2014

The father says that on 21 August 2014 he made an offer to the mother by email[12] proposing that the mother refinance the Suburb G property into her sole name and discharge certain loans. It is the father’s contention that his proposal would have left the mother with 123 per cent of the matrimonial pool and him with minus 23 per cent. The father says that the mother refused that offer and on 24 October 2014 commenced these proceedings with an Initiating Application that proposed that she receive 75 per cent of the net assets.
[12] Document P in the tender book for the larger affidavit of the father affirmed 8 May 2019
On those facts the mother would have been better off had she accepted the offer of 21 August 2014.
There are two things to say about that. First, the email of 21 August 2014 does not propose anything. As to the mother refinancing the Suburb G property the letter contains a paragraph:
…
[Ms Seidler] has a desire to keep the house independent of myself – I personally cannot see how this will work. However if she has a plan to refinance the mortgage in her name only, or in conjunction with Ms H for the total current liabilities then I am happy to engage in this discussion. Again – I don’t think this is a practical option.
…
The email is something well short of a concrete settlement offer.
Secondly, there would be little or no prospect of the Court approving a that left one party with a debt and the other with an asset.

A financial offer made by the father on 16 October 2014

The father sent an email[13] to the mother on 16 October 2014 which he says summarised a meeting that had occurred that day between the parties, the mother’s mother and her barrister. The father contends that the offer would have resulted in the mother retaining 133 per cent of the net assets and him having a debt (minus 33 per cent of the net assets).
[13] Document R in the tender book for the larger affidavit of the father affirmed 8 May 2019
The copy of the email in the tender bundle refers to an attached spreadsheet but there is no spreadsheet included in the tender bundle. The spreadsheet may have explained matters but the email does not seem to contain an offer for final resolution of the parties’ property issues. For example, paragraphs 1A and 1B are as follows:
1A. If the house sells for 1.5 Million or above – we both agree to the sale. The first 1.5 Million will be used to pay the attached list of costs + agents commission/conveyancing. Anything above that will either be distributed according to any future financial agreement prior to settlement, or if there is no agreement prior to settlement – the excess funds after paying the attached spreadsheet of costs will be put into a lawyer controlled trust fund until agreement.
1B.[Ms Seidler] would like an agreement as to the percentage distribution of these excess funds of the house sale now, prior to auction, without an agreement of any other aspects of a future financial agreement. I don’t think that this is possible or sensible to do without a consider (sic) of how this component fits into the total distribution of assets/liabilities.
…
On the face of those paragraphs the proposal does not comprehensively deal with all potential property settlement issues.

Offers made by the father on 10 March 2015

On 10 March 2015 the mother’s application for interim financial and parenting orders came before Chief Judge Pascoe in the Federal Circuit Court. The father says that prior to the appearances on that day the parties’ counsel negotiated an agreement to settle all financial and parenting issues. The father says that the mother’s counsel told the Court that the interim application of the mother would be withdrawn and transcribed consent orders would be provided to the chambers of the Chief Judge within seven days for orders to be made in chambers. The father says that on 12 October 2015 his counsel provided a typed property settlement proposal[14] to the mother’s counsel. The father says that by a letter dated 17 March 2015[15] the mother rejected his proposal. That is not what the letter dated 17 March 2015 from the mother’s solicitors says. The letter commences:
I note your client has rejected my client’s offers in relation to both parenting and property matters.
…
[14] Document S of the tender bundle for the larger of the two affidavits of the father affirmed on 8 May 2019
[15] Document T of the tender bundle for the larger of the two affidavits of the father affirmed on 8 May 2019
On the face of the letter, it was the father rejecting the mother’s proposal and not the other way around.
As to the father’s parenting proposal this was in the form of a proposed consent order signed by the father and the Independent Children’s Lawyer that was provided to the mother’s counsel on 10 March 2015. While the regime projected in the Minute of Parenting Orders[16] was similar to that ultimately ordered, those arrangements were to commence nearly three years later and only after and conditional upon, the father attended a parenting course, followed by a schedule for the next two plus years of time for D with the father, commencing with day only time and gradually increasing until the ultimate 2018 regime commenced. Although that offer was not specifically addressed in the mother’s case, it was conditional and made prior to any expert evidence being available.
[16] Commencing at page 1 of the tender bundle for the larger of the two affidavits of the father affirmed on 8 May 2019

Financial orders made on 25 May 2016

On 25 May 2016 the parties attended a conciliation conference with a registrar. The father was self-represented and the mother attended with her solicitor. The father says that the mother made a proposal and he accepted. Orders[17] were made in terms of the parties’ agreement by the registrar on 25 May 2016. On 31 May 2016 the mother filed an application to review the making of those orders. Although the father opposed the review, the application requiring a de novo hearing of decision made by the registrar and in the absence of consent, the Court was required to set aside the orders of 25 May 2016.
[17] Document M of the tender bundle for the larger of the two affidavits of the father affirmed on 8 May 2019

This was not so much a failure to consider a settlement proposal as the mother reneging on her earlier acceptance of an offer. It is the father’s submission that had the orders been maintained the mother would have been much better off. He speculates that because of a valuation of $2.6 million for the Suburb G property at the time, and because there would have been no capital gains tax and the mother was to receive 61 per cent of the net assets under the orders rather than the 60 per cent she ultimately received, the mother would have been advantaged under the earlier orders.
The mother asserts[18] that the father had not fully disclosed his financial position or provided current financial records by the date of the conference. The mother says that she expected the conference to be adjourned and was not prepared for the conference. She says that she felt pressured into making concessions and was unable to think clearly. The mother says that she had a very clear impression that she would have a five day cooling off-period within which she could withdraw the consent she gave on the day to the proposed orders. It is the mother’s evidence that she gave instructions to her solicitors on 27 May 2016 to withdraw the consent she had given on 25 May 2016. The mother deposed that she filed her application on 30 May 2016 and the application was listed on 17 August 2016. The mother deposed that she believed that the orders she had agreed to were not in the best interests of D.
[18] By her affidavit filed 8 June 2016
In response the father says[19] that he made proper disclosure and provided the necessary records. Presumably seeking to challenge the mother’s representations about her state of mind at the conference, the father says that the orders were drafted by the mother’s lawyers and that she had sufficient time to give them proper consideration. As with the father’s view that the mother’s review application was doomed to fail[20] the father’s evidence about the mother’s state of mind on 25 May 2016 is of no probative value. He was simply not in a position to gainsay the mother’s evidence on that issue.
[19] By his affidavit filed 21 June 2016
[20] Paragraph 75 of the father’s affidavit filed 21 June 2016

A parenting offer made by the father in October 2017

By an Application in a Case filed on 4 September 2017 the father sought orders in terms of paragraphs 3 – 24 of the mother’s Further Amended Initiating Application filed 23 March 2015. It is the evidence of the father that on 6 October 2017 the mother filed a Response seeking that the father’s Application in a Case be dismissed and that on 9 October 2017 the mother was ordered to further amend her Initiating Application and that she did not comply until several days before the final hearing.
The father’s 2017 Application in a Case did not simply seek the orders proposed by the mother in her 2015 application. At paragraphs 2 to 5 inclusive the father sought certain orders and at paragraph 7 the preamble to his application that the Court make orders in terms of most of the orders sought by the mother, required that the arrangements in paragraphs 2 to 5[21] be prioritised in the first instance over the mother’s orders. It cannot be said that there was an unconditional meeting of minds at any one point in relation to the orders proposed by the mother in 2015 or by the father in 2017.
[21] The reference is to prioritising “orders 1 to 4” but given the wording of paragraphs 1 to 5 I think that was a typographical error and the father intended “2 to 5”.

Financial and parenting offer made on 12 June 2018

It is the father’s evidence that he received proposed consent orders from the mother’s solicitor on 23 May 2018. The proposed orders provided for D to spend five nights a fortnight with the father. The father signed and returned the document. However, the father filed a further amended application on 3 June 2018 seeking an equal time arrangement. The father says that under cover of a letter dated 7 June 2018 the mother too proposed an equal time arrangement. The father says that the mother must have changed her mind because on 12 June 2018 the mother’s lawyers handed up a copy of the 23 May 2018 agreement and orders were made in terms of that document. I do not really understand that evidence. If orders were made “by consent” on a document that was no longer agreed, why was that not brought to the attention of the Court?
The father says that he then proposed on 12 June 2018[22] that there be a transition to equal time. The mother’s solicitors responded on 21 June 2018 to the effect that the mother was considering the proposal. However, the father says that the mother never responded. The father’s letter of 12 June 2018 says that if not agreed by 5.00 pm on 15 June 2018, his proposal contained in that letter would lapse and later in the same letter that if the orders were not agreed and signed by 5.00 pm on 19 June 2018, the offer is also withdrawn. On any reading of the letter, the offer had lapsed by the time of the response from the mother’s solicitor on 21 June 2018.
[22] Document J of the tender bundle for the larger of the two affidavits of the father affirmed on 8 May 2019
As I have indicated the letter of 12 June 2018 is not entirely clear. For example there is the following passage:
…
I will set out the parameters for settlement of the Parenting and Financial Matters in this letter. Should your client agree to these parameters, please indicate this in writing to me by 5.00 pm on Friday the 15^thof June 2018.
If agreement on the parameters for settlement is achieved, then the detail and wording of the orders must be agreed to by both parties, and signed by both parties, and submitted to Justice Loughnan for orders to be made in chambers by 5.00 pm on the 19^th of June. If all parties do not agree on the wording of the detail of the orders, and sign the orders, by 5.00 pm on Tuesday the 19^thof June, the offer is withdrawn. After this time I will not make any further offers to settle, or respond to any settlement offers from your client and will be preparing for the Final Hearing set for 10 December 2018. ….”
(Emphasis added)
The underlined words suggest that something other than the parameters set out in the letter had to be agreed. That in turn suggests that the proposal was not complete.
There is nothing about that evidence that assists with the determination of the mother’s costs application. Many of the communications were unclear. Some of the communications responded a considerable time after the initial offer or proposal. In respect of the parenting proposals there was the position of the ICL to consider. The proceedings were on foot for years and yet the single expert evidence was only received late in the piece. The value of the Suburb G property was and remains a matter of conjecture and with the best will in the world, given the level of the parties’ debts that would have made the drafting and negotiation of a clear final settlement proposal very difficult.

Other matters

The father did not have legal representation for the period leading up to and during the final hearing. As is submitted for him, as with any litigant, the father was entitled to be self-represented. I formed the view that that fact added to the mother’s costs of the proceedings. I confess that my view was somewhat shaken when these costs, slip rule and machinery proceedings required significant written material, an adjournment of the first date fixed for the hearing and the best part of a day to hear, notwithstanding that for those proceedings, both parties were represented. Nevertheless I maintain the original view. The burden of legal costs fell unevenly and very heavily on the mother. The mother’s costs were $384,182.54 while the father’s costs were $159,856. I was in a position to observe and conclude that, like the mother, at times the father has benefited from the legal representation funded solely by her.
I appreciate that the parties and their poor relationship would have had an influence on the proceedings even if they both had the benefit of legal representation throughout. However, something else must have gone wrong for the parties to incur combined costs in excess of half a million dollars in family law parenting and financial proceedings involving a narrow range of disputes and few complicating issues.
It is likely that the mother’s costs were increased as a result of her twice changing her solicitors. That should reduce the quantum of costs awarded against the father. Just as a party is entitled to appear without legal representation, so too was the mother entitled to change her lawyers if she wished. However, in each case, the financial impact of those choices should not be unfairly visited on the other party.

Should an order be made?

The father is in a stronger financial position than the mother. Although the mother changed solicitors on two occasions, that fact is unlikely to have had the financial impact on the father that his conduct of the proceedings had on the mother’s costs. The net result had the mother paying over $220,000 more in legal fees than the father. In my view the husband should contribute to the wife’s costs.

The basis and quantification for costs

The mother seeks that her costs or half of certain costs, for specific periods, be quantified on an indemnity basis. All costs orders provide a level of indemnity but I understand the mother to seek an order on a full indemnity basis albeit for only part of the duration of the proceedings and for only 50 per cent in respect of one claim.
Costs are generally awarded on a party and party basis. That basis usually provides only a partial indemnity to the party who secures a costs order. Absent considerations such as the costs of a representative litigant such as a trustee (where costs would normally be assessed on a trustee basis), the authorities require that justification is given by a Court for awarding costs on any more generous basis than party and party.
In Colgate Palmolive Co and Another v Cussons Pty Ltd [1993] FCA 536; (1993) 46 FCR 225 the Federal Court of Australia (Sheppard J) reviewed the English and Australian authorities about costs generally and at paragraph 24 said:
24.It seems to me that the following principles or guidelines can be distilled out of the authorities to which I have referred:-
1.The problem arises in adversary litigation, i.e. litigation as between parties at arm’s length. Different considerations apply where parties may be found to be entitled to the payment of their costs out of a fund or assets being administered by or under the control of a trustee, liquidator, receiver or person in a like position, eg. a government agency or statutory authority.
2.The ordinary rule is that, where the Court orders the costs of one party to litigation to be paid by another party, the order is for payment of those costs on the party and party basis. In this Court the provisions of Order 62, rules 12 and 19, and the Second Schedule to the Rules will apply to the taxation. In many cases the result will be that the amount recovered by the successful party under the Order will fall short of (in many cases well short of) a complete indemnity.
3.This has been the settled practice for centuries in England. It is a practice which is entrenched in Australia. Either legislation (perhaps in the form of an amendment to rules of Court) or a decision of an intermediate court of appeal or of the High Court would be required to alter it. No doubt any consideration of whether there should be any change in the practice would require the resolution of the competing considerations mentioned by Devlin LJ in Berry v. British Transport Commission and Handley JA in Cachia v. Hanes on the one hand and by Rogers J in Qantas on the other. The relevant passages from the respective judgments have been earlier referred to.
4.In consequence of the settled practice which exists, the Court ought not usually make an order for the payment of costs on some basis other than the party and party basis. The circumstances of the case must be such as to warrant the Court in departing from the usual course. That has been the view of all judges dealing with applications for payment of costs on the indemnity or some other basis whether here or in England. The tests have been variously put. The Court of Appeal in Mr GGs v. Barnes (39 Ch D at 141) said the Court had a general and discretionary power to award costs as between solicitor and client “as and when the justice of the case might so require.” Woodward J in Fountain Selected Meats appears to have adopted what was said by Brandon LJ (as he was) in Preston v. Preston ((1982) 1 All ER at 58) namely, there should be some special or unusual feature in the case to justify the Court in departing from the ordinary practice. Most judges dealing with the problem have resolved the particular case before them by dealing with the circumstances of that case and finding in it the presence or absence of factors which would be capable, if they existed, of warranting a departure from the usual rule. But as French J said (at 8) in Tetijo, “The categories in which the discretion may be exercised are not closed”. Davies J expressed (at 6) similar views in Ragata.
5.Notwithstanding the fact that that is so, it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion. I instance the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud (both referred to by Woodward J in Fountain and also by Gummow J in Thors v. Weekes (1989) 92 ALR 131 at 152; evidence of particular misconduct that causes loss of time to the Court and to other parties (French J in Tetijo); the fact that the proceedings were commenced or continued for some ulterior motive (Davies J in Ragata) or in wilful disregard of known facts or clearly established law (Woodward J in Fountain and French J in J-Corp); the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions (Davies J in Ragata); an imprudent refusal of an offer to compromise (eg Messiter v. Hutchinson (1987) 10 NSWLR 525, Maitland Hospital v. Fisher (No. 2) (1992) 27 NSWLR 721 at 724 (Court of Appeal), Crisp v. Keng (Supreme Court of New South Wales, 27 September 1993, unreported, Court of Appeal) and an award of costs on an indemnity basis against a contemnor (eg Megarry V-C in EMI Records). Other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for payment of costs other than on a party and party basis.
6.It remains to say that the existence of particular facts and circumstances capable of warranting the making of an order for payment of costs, for instance, on the indemnity basis, does not mean that judges are necessarily obliged to exercise their discretion to make such an order. The costs are always in the discretion of the trial judge. Provided that discretion is exercised having regard to the applicable principles and the particular circumstances of the instant case its exercise will not be found to have miscarried unless it appears that the order which has been made involves a manifest error or injustice.
I note that unlike the position under the Act, the context of Colgate Palmolive Co and Another v Cussons Pty Ltd was litigation in a jurisdiction where costs generally follow the event. Nevertheless, it is a departure from party and party costs, rather than an order for indemnity costs that requires additional justification. As to whether the circumstances must be of an exceptional kind for an award on an indemnity basis, I could find no reference to “exceptional” in the judgment in Colgate Palmolive Co and Another v Cussons Pty Ltd. Given that the class of circumstances warranting a departure from party and party costs has been found to be open, in my view it is not useful to look for adjectives to define that class.
In respect of this jurisdiction, as was referred to in Munday v Bowman (1997) FLC 92-784[23], the word “exceptional” was used by the Full Court of this Court in Kohan and Kohan (1993) FLC 92-340 and there rather confusingly, it was used both in respect of any departure from party and party costs and in respect of indemnity costs. Perhaps the term was intended to mean no more than – Courts should normally award costs on a party and party basis and if a Court departs from that basis, for a more generous award, reasons must be given for that departure.
[23] A decision of Chief Judge Holden sitting in the Family Court of Western Australia
Ultimately, the determination in respect of costs must be just[24].
[24]Family Law Act 1975 (Cth) 117(2)
In Colgate Palmolive Co and Another v Cussons Pty Ltd it was argued that there should be a departure from party and party costs inter alia because of the way in which the applicants ran their case. A similar argument is made on behalf of the mother in the proceedings before me. In Colgate Palmolive Co and Another v Cussons Pty Ltd Sheppard J found that the conduct of the proceedings by the applicant had increased costs. His Honour found “… it is quite clear that the hearing was made more complex and was unnecessarily prolonged by the maintenance of the applicants’ case based on …” a particular test. Nevertheless his Honour did not consider that the applicant’s conduct in those proceedings warranted a more generous award of costs than on a party and party basis. Sheppard J dealt with the matter in the following paragraph:
43. I do not think that in this respect the case which the applicants maintained was any different from countless other cases which are maintained by parties to litigation in which reliance is placed on a number of alternative ways of putting the case. As the case proceeds, so circumstances change and sometimes, as in this case, it is better tactics to give away a particular alternative than to maintain it. To my mind that is what the applicants did here. I appreciate that it is not what they say they did; but to my observation, looking at the matter as objectively as I can, that is what happened. I do not regard their conduct in this respect as misconduct of the kind which is required before the Court ought to consider making an order for payment of costs on the indemnity basis. I think the tactics were fair. No doubt they caused substantial expense to the respondent; but that expense is what the respondent is entitled to recover under an ordinary order for costs which, although it has the problems about it to which I have referred earlier in this judgment, is the law’s way of dealing with a matter such as this. Many may think it unsatisfactory but, unless there is some feature of the case which attracts a more generous basis upon which costs are to be allowed, the usual course of a party and party taxation must be followed.
(emphasis added)
As I have referred to above, there are aggravating factors in the father’s conduct of the proceedings. In my view the volume and tone of the father’s affidavit and the necessary import of his deposition for the case the mother had to meet, was not fair. In my view there is sufficient justification to depart from an award of costs on a party and party basis.
The starting point for any costs order is that the costs were or are payable. I am satisfied that the mother was and is obliged to meet the costs claimed and more.
I would like to award costs in a fixed sum[25]. Whatever the parameters, I am confident that the parties will neither be able to agree about the quantum of costs or efficiently manage the process of an assessment by a taxing officer. An order expressed in the style of the mother’s application would involve an enormous amount of work for a taxing officer even after a bill was submitted in taxable form. There would be significant additional costs in the process of taxation and potentially a further resultant costs dispute. There is a theme in the mother’s case about the adverse impact on her of the litigation and her conflict with the father. I do not want to prolong the litigation or the potential for that conflict.
[25] Family Law Rules 2004 r 19.18(1)(a)

The problem in relation to fixing a sum is that there is little detailed information on which to base the assessment I would make. There is no itemised bill.
I have the evidence about the costs imposts made on the parties. That reveals the difference in their costs burdens for these proceedings. I will make an order for costs in the fixed sum of $80,000. That does not result in the burden of costs being shared equally between the parties but provides an adjustment, a partial indemnity, which is warranted based on the s 117(2A) factors set out above. I am confident that the sum is substantially within the ambit of (less than) the mother’s claim. To the extent that the sum is greater than a party and party award, the circumstances described above warrant such an order.

Conclusion

The father is in a stronger financial position than the mother. The mother incurred costs over and above those which she would normally incur because of the conduct of the father in prosecuting his case in these proceedings. The mother carried the load of legal representation for important periods of the litigation when the father did not and he benefited from her representation. The mother should be indemnified in relation to some of her costs. The parties’ litigation is in its fifth year. The parties are highly unlikely to reach an agreement about the quantification of costs. The taxation process would involve costs and delay out of proportion to the matters at issue. The costs to be paid are assessed at $80,000.
I will provide for the father to pay the costs within 21 days of the payment to him pursuant to Order (3)(k) made on 30 January 2019 as amended or such other time as the parties might agree upon in writing.

I certify that the preceding one hundred and two (102) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Loughnan delivered on 13 June 2019.

Associate:

Date: 13 June 2019

Key Legal Topics

Areas of Law

Family Law
Civil Procedure

Legal Concepts

Costs
Remedies
Procedural Fairness
Res Judicata

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Citations

Cerny and Seidler (No 2) [2019] FamCA 381

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12

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Gludau & Gludau (No. 2) [2013] FamCAFC 181

L Shaddock & Associates Pty Ltd v Parramatta City Council (No 2) [1982] HCA 59

Commonwealth v McCormack [1984] HCA 57

[2019] FamCA 381

13 June 2019

Key Legal Topics

Areas of Law

Family Law

Civil Procedure

Legal Concepts

Costs

Remedies

Procedural Fairness

Res Judicata