Channing & Channing (No 5)
[2024] FedCFamC2F 1574
•12 November 2024
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Channing & Channing (No 5) [2024] FedCFamC2F 1574
File number(s): PAC 5460 of 2021 Judgment of: JUDGE OBRADOVIC Date of judgment: 12 November 2024 Catchwords: FAMILY LAW – COSTS – Interlocutory application wholly unsuccessful Legislation: Family Law Act 1975 (Cth) s 117
Federal Circuit and Family Court of Australia (Division 2) (Family Law) Rules 2021 (Cth) schedule 1
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 1.33
Cases cited: Colgate Palmolive Co and Anor v Cussons Pty Ltd [1993] FCA 801
Collins & Collins [1985] FamCA 15
Fitzgerald v Fish and Anor [2005] FamCA 158
Greedy and Greedy [1982] FamCA 41
I & I (No.2) [1995] FamCA 80
Jensen & Jensen [1982] FamCA 57
Kohan & Kohan [1992] FamCA 116
Latoudis v Casey [1990] HCA 59
Medlon & Medlon (No. 6) (Indemnity Costs) [2015] FamCAFC 157
Munday v Bowman (1997) FLC 92-784
Penfold & Penfold [1980] HCA 4
Renald & Renald (Costs) [2018] FamCAFC 4
Stasiuk & Guild [2021] FamCAFC 62
Division: Division 2 Family Law Number of paragraphs: 38 Date of last submission/s: 4 November 2024 Date of hearing: On the papers Place: Parramatta Solicitor for the Applicant: Hikma Legal Solicitor for the Respondent: AJL Legal ORDERS
PAC 5460 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MS CHANNING
Applicant
AND: MR CHANNING
Respondent
ORDER MADE BY:
JUDGE OBRADOVIC
DATE OF ORDER:
12 NOVEMBER 2024
THE COURT ORDERS THAT:
1.Within 28 days, the respondent pay the applicant’s costs of the Application in a Proceeding filed 20 February 2024, assessed in the amount of $6,710.48.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to subsection 114Q(2) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
JUDGE OBRADOVIC:
These are the Reasons for Judgment in respect of the applicant’s oral application for costs made on 21 March 2024.
It is an application for costs of the Application in a Proceeding, filed on 20 February 2024 (‘AiP’). It is made on an indemnity basis.
For the sake of clarity, the AiP was lodged for filing after hours on 19 February 2024 and has interchangeably been referred to as being filed on both 19 and 20 February 2024, in various places on the Court record. It is the one and same AiP.
The Reasons for Judgment in the substantive proceedings were delivered on 19 September 2024. The Court’s reasons, together with the relevant background can be found at Channing & Channing (No.4) [2024] FedCFamC2F 1287 (‘Channing (No.4)’).
LEGAL PRINCIPLES
The starting position with respect to costs, as set out in s 117 of the Family Law Act 1975 (Cth) (‘Act’) is that, subject to sub-section 117(2), each party to proceedings under the Act shall bear his or her own costs.
The principles in respect of costs orders in family law proceedings are well known.
While the wording of s 117(1) has now been amended[1] to substitute the word ‘must’ instead of the word ‘shall’, the meaning remains the same. In any event, the substantive proceedings were head prior to the commencement of the amendments, albeit judgment was delivered afterwards.
[1] Family Law Amendment Act 2023 (Cth).
The discretion to award costs is a broad discretion.[2] No one factor under s 117(2A) prevails over any other factor. It is a matter of weight that is accorded to each of the relevant factors in the Court’s discretion.[3]
[2] For example, Collins & Collins [1985] FamCA 15.
[3] Medlon & Medlon (No. 6) (Indemnity Costs) [2015] FamCAFC 157 at [24] (‘Medlon’).
The High Court held in Penfold & Penfold[4] that it is necessary for the Court to make a finding of justifying circumstances as an essential preliminary to the making of an order for costs. The Court is not required to specify the circumstances which justify the making of such an order.
[4] [1980] HCA 4 (‘Penfold’).
As long as there is an essential preliminary finding that there are justifying circumstances to make a costs order, there is no additional or special onus which an applicant needs to establish for an order for costs. It is not the law that a costs order can only be made in what has been described as a ‘clear case’.[5]
[5] Penfold at [13]; Jensen & Jensen [1982] FamCA 57.
Any one of the factors in s 117(2A) may be the sole foundation for an order for costs.[6] Nevertheless, the relevant matters in s 117(2A) ‘must all be taken into account and all balanced in order to determine whether the overall circumstances justify the making of an order for costs’.[7]
[6] Fitzgerald v Fish and Anor [2005] FamCA 158 at [41]; Renald & Renald (Costs) [2018] FamCAFC 4 at [11] (‘Renald’).
[7] I & I (No.2) [1995] FamCA 80; Renald at [11].
In determining what order, if any, should be made under s 117(2) the Court must have regard to the prescriptive but non-exhaustive list of considerations in sub-section (2A).
The Court has the power to order costs on an indemnity basis.[8] An order for indemnity costs in proceedings to which s 117 applies is exceptional.[9]
[8] Kohan & Kohan [1992] FamCA 116 (‘Kohan’); Latoudis v Casey [1990] HCA 59.
[9] Kohan; Stasiuk & Guild [2021] FamCAFC 62.
The principles in respect of indemnity costs orders are also well known,[10] and may be summarised in the following way:[11]
(a)Where it appears that an action has been commenced or continued in circumstances where a party, properly advised, should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive or because of some wilful disregard of the known facts;
(b)Making allegations of fraud, knowing them to be false, and the making of irrelevant allegations of fraud;
(c)Evidence of particular misconduct causing loss of time to the court and to other parties;
(d)The making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions; and/or
(e)An imprudent refusal of an offer to compromise.
[10] See generally Sheppard J in Colgate Palmolive Co and Anor v Cussons Pty Ltd [1993] FCA 801.
[11] Medlon at [28] referring to Holden CJ in Munday v Bowman (1997) FLC 92-784 at 84,660, other citations omitted.
It is unnecessary to spell out detailed reasons for decisions in costs matters.[12]
[12] Greedy and Greedy [1982] FamCA 41; Renald at [12].
DETERMINATION
The full procedural history is set out in Channing (No.4) at [26]-[52].
Following delivery of judgment in Channing (No.4), the proceedings were listed for a mention and further procedural orders made for the parties to file and serve any evidence and submissions in respect of the oral application for costs, and for that application to be dealt with on the papers.
The applicant relies on her submissions filed on 28 March 2024.
The respondent has not filed submissions in accordance with orders made.
If a step is taken after the time specified for taking the step by a procedural order, the step is of no effect.[13] The father has not applied for relief from the effect of r 1.33 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (‘Rules’).
[13] Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 1.33.
Notwithstanding, the Court has had regard to the respondent’s submissions filed 4 November 2024.[14]
[14] The applicant was directed to file and serve any evidence and submissions in support of her application for costs within 28 days, and the respondent was directed to file and serve his evidence and submissions in response to the application for costs 14 days thereafter, that is, by 4pm on 31 October 2024. He did not do so. He lodged his submissions for filing at 4.34pm on 1 November 2024, which means the submissions were filed on 4 November 2024.
Neither party filed any evidence in respect of the costs application.
The applicant’s Costs Notice dated 1 March 2024,[15] discloses the legal costs in respect of the AiP to be in the amount of $7,700. She moves the Court for an order that the father pay her costs on an indemnity basis, in the amount of $7,700.
[15] Being the Costs Notice closest to the date of filing of the Application in a Proceeding of 19 February 2024.
The respondent’s lawyer has not filed a Costs Notice since 24 October 2023, despite the requirement of r 12.06 of the Rules to do so.
There is no evidence of the parties’ financial circumstances.
Neither party is in receipt of legal aid.
The respondent, as noted earlier in these reasons, has failed to comply with the Orders of 19 September 2024, in respect of the filing of submissions.
There is, however, nothing to suggest that the AiP was necessitated by a failure of either party to comply with orders. Furthermore, there is nothing to suggest that the respondent was anything but bona fide in his interlocutory application.
The AiP sought recusal of the judge hearing the matter on the basis of apprehended bias and the appointment of a forensic psychiatrist in the matter.
The AiP was dismissed on 7 March 2024, following a hearing on 1 March 2024.
Reasons for Judgment in respect of the AiP were delivered on 7 March 2024, and can be found at Channing & Channing [2024] FedCFamC2F 293 (‘Channing (No.1)’).
The respondent was wholly unsuccessful.
The Court is satisfied that there are circumstances justifying the making of a costs order.
The Court is not satisfied that an indemnity costs order is appropriate.
Having regard to the relevant factors, but particularly that the respondent was wholly unsuccessful, the Court is satisfied that the respondent pay the applicant’s costs of the AiP in accordance with Schedule 1 of Federal Circuit and Family Court of Australia (Division 2) (Family Law) Rules 2021 (Cth),[16] as follows:
(a)Item 3: Opposing an application for interlocutory orders (including an interim hearing): $2,093.62 and $1,255.75; total: $3,349.37;
(b)Item 7: Preparation, but half-day only allowed: $2,676.73; and
(c)Item 10: Attendance at hearing to take judgment and explain orders: $342.19 and $342.19; total $684.38.
Total: $6,710.48.
[16] As applicable at the time of the hearing of the AiP and its determination.
In all of the circumstances, it is just for the respondent to pay the applicant’s costs of the AiP, assessed in the amount of $6,710.48.
The Court notes that the parties had already applied to the Court to make an order by consent, on 8 April 2024, that the respondent pay the applicant’s costs of the Application in a Proceeding filed 18 March 2024, agreed in the amount of $2,750. Such order was made. Therefore, any submissions made by the parties relating to the costs of that application are not relevant.
The Court so orders.
I certify that the preceding thirty-eight (38) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Obradovic. Associate:
Dated: 12 November 2024
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