Chatterjee and Woodby-Chatterjee

[2016] FamCA 213

FAMILY COURT OF AUSTRALIA

CHATTERJEE & WOODBY-CHATTERJEE [2016] FamCA 213

FAMILY LAW – LEGAL COSTS – Where the husband seeks a cost order pursuant to s 117(2) – Where the Court found that there was basis to award costs to the husband

Family Law Act 1975 (Cth) ss 117(2), 117(2A)

APPLICANT: Mr Chatterjee

RESPONDENT: Ms Woodby-Chatterjee

FILE NUMBER: SYC 3822 of 2013

DATE DELIVERED: 23 March 2016

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Rees J

HEARING DATE: In Chambers

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Bridger

SOLICITOR FOR THE APPLICANT: Bricknell Legal Solicitors

COUNSEL FOR THE RESPONDENT: Mr Eardley

SOLICITOR FOR THE RESPONDENT: G & D Lawyers

Orders

IT IS ORDERED

1. That the wife pay the husband’s costs of the Application in a Case filed 13 January 2015 and the Amended Application in a Case filed 7 October 2015, as assessed or agreed on a party and party basis, such costs to be paid from any money received by the wife by way of property settlement or by way of enforcement of the Binding Financial Agreement entered into by the parties in 2003. 

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

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 3822 of 2013

Mr Chatterjee

Applicant

And

Ms Woodby-Chatterjee

Respondent

REASONS FOR JUDGMENT

1. Mr Chatterjee (“the husband”) and Ms Woodby-Chatterjee (“the wife”) are engaged in defended proceedings for property settlement.

2. On 4 November 2015, judgment was delivered in relation to an application by the wife for litigation funding pursuant to s 117(2) of the Family Law Act 1975 (Cth) (“the Act”). The application of the wife was dismissed.

3. The husband now seeks an order that the wife pay his costs in relation to that application.

4. Each party has filed affidavit evidence in relation to the issue of costs and each party has agreed that the matter should be determined in Chambers on the basis of their affidavit evidence and their submissions.

5. As a preliminary matter, the wife submits that the husband’s application for costs was not filed within time and that his application must therefore fail. The husband disputes that his application was not filed in time but, in the event that it is determined that it was, then he seeks an extension of time.

6. The wife’s Application in a Case, seeking an order, inter alia, that the husband pays $50,000 by way of costs, was filed on 13 January 2015. The husband filed a Response to that application on 20 February 2015 seeking orders that the wife’s application be dismissed and that she pay his costs of the application. On 7 October 2015, the wife filed an Amended Application in a Case seeking an order that the husband pay costs of $50,000 and also seeking a “dollar for dollar” order. The husband attempted to electronically file a Response to the Amended Application in a Case but the document was rejected by the Portal. In the Response to the Amended Application in a Case the husband sought the same orders he sought in the response filed on 20 February 2015, that is, that the application be dismissed and the wife pay his costs. When the response was rejected by the Portal, the solicitor for the husband forwarded a copy of it by email to the wife’s solicitor on 13 October 2015.

7. The husband having sought an order for costs in his response filed 20 February 2015, was not required to seek the order again in response to the wife’s amended application. There was no requirement that he amend his response only because she amended her application if the response that had been filed continued to set out the orders he sought.

8. Accordingly, the husband’s application for costs was filed within time and no extension is required.

9. The application falls to be determined having regard to the matters set out in s 117(2A) of the Act which are here set out:

   (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.

10. The financial circumstances of the parties

    In the reasons delivered on 4 November 2015, the financial circumstances of the parties were considered and findings were made. Those reasons should be read in conjunction with these. Ultimately, it was found that although the husband’s income was greater than that of the wife, because of the amounts he paid for her benefit and that of the children, he was in no better financial position than she was. The expenses incurred by the parties, then and now, far exceed their combined incomes.

11. The wife in her affidavit sworn 16 March 2016, in relation to the costs application, deposes that she has voluntarily assumed the responsibility for the children’s private school fees and intends to pay them from a credit card and a line of credit. Those fees were previously paid by the husband. However, this change in their financial circumstances does not detract from the fact that their expenses continue to exceed their income.

12. The wife in her affidavit deposed to changes in the husband’s living circumstances. In so far as her evidence is admissible, she deposed to an increase in his expenses but does not depose to any increase in his income.

13. The conduct of the parties to the proceedings

    The husband submits that the conduct of the wife which was described in the reasons for judgment handed down on 4 November 2015 should be taken into account again in determining this application. 

14. This is an application in relation to the costs of completed proceedings. It is neither necessary nor appropriate to extend the provisions of s 117(2A)(c) beyond its simple terms and I propose to consider only those matters relating to the conduct of the parties in relation the manner in which the proceedings progressed.

15. Nothing in the manner in which the proceedings were conducted warrants consideration in relation to costs.

16. Whether any party has been wholly unsuccessful

    The wife’s application was dismissed.  

17. Offers of settlement

    After judgment was handed down on 4 November 2015, a letter dated 15 December 2015 was written by the solicitors for the husband to the solicitors for the wife proposing that the issue of costs be resolved on the basis that the husband’s costs were reserved to the final hearing.

18. On 17 December 2015, the wife’s solicitors wrote to the husband’s solicitors advising that they did not consent to an order that the husband’s costs be reserved.

19. On 21 December 2015, the husband’s solicitors wrote again to the wife’s solicitors saying:

    We note your comment that our client does not need you to agree to reserve his costs. Of course he does not. Our invitations (for your client to consent either to an order for costs, or to have the costs reserved) were made in an attempt to save the parties time and additional legal costs. We assumed, based on your client’s (unsuccessful) Application, that she would share our client’s desire to minimise legal costs. However, if your client will not now agree, then she leaves our client with no alternative other than to have us put the matter before the Court. If so, we will rely on this letter in relation to costs. 

20. If there was a response to that letter from the solicitors for the wife, it was not in evidence.

21. Why the wife rejected a reasonable suggestion that the husband’s costs of her unsuccessful application be reserved is not explained. However the effect of her rejection is that the costs application proceeded and both parties were put to the unnecessary expense of filing affidavits and written submissions.

22. A consideration of all of the relevant matters in s 117(2A) favours the making of an order for the wife to pay the husband’s costs of her unsuccessful application. Since she has no present funds available to pay those costs, the payment should be made out of such funds as she receives at the conclusion of the proceedings.

I certify that the preceding twenty-two (22) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 23 March 2016.

Associate:

Date:  23/3/2016