Closs & Closs

Case

[2023] FedCFamC2F 556


FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA

(DIVISION 2)

Closs & Closs [2023] FedCFamC2F 556

File number(s): ADC 5592 of 2019
Judgment of: JUDGE MCGINN
Date of judgment: 12 May 2023
Catchwords: FAMILY LAW – litigation funding – interim property settlement application – trial preparation and trial expenses – detail of claimed costs – sufficiency – application granted in part  
Legislation:

Family Law Act 1975 (Cth)

Federal Circuit and Family Court of Australia Rules 2021

Cases cited:

Kramer & Kramer [2023] FedCFamC2F 221

Stanford v Stanford (2012) FLC 93-518

Strahan & Strahan (Interim Property Order)[2009] FamCAFC 166

Wilson & Wilson (1989)FLC 92-033

Zschokke and Zschokke (1996) FLC 92-693

Division: Division 2 Family Law
Number of paragraphs: 89
Date of hearing: 8 May 2023
Place: Adelaide
Counsel for the Applicant: Mr Tredrea
Solicitor for the Applicant: Jordan & Fowler Family Lawyers
Counsel for the Respondent: Mr Richards
Solicitor for the Respondent: Clelands Lawyers Adelaide Pty Ltd
Solicitor for the Independent Children's Lawyer: Ms O’Brien, Legal Services Commission of South Australia

ORDERS

ADC 5592 of 2019

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)

BETWEEN:

MS CLOSS

Applicant

AND:

MR CLOSS

Respondent

INDEPENDENT CHILDREN'S LAWYER

order made by:

JUDGE MCGINN

DATE OF ORDER:

12 May 2023

IT IS ORDERED:

1.That by way of partial property settlement pursuant to s 79 of the Family Law Act (Cth) within 14 days the respondent husband do pay to the applicant wife’s solicitor’s trust account the sum of $50,000 to be applied for the purpose only of paying the applicant wife’s legal fees and disbursements of these proceedings.

2.That the wife’s Application in a Proceeding sealed 12 April 2023 and the husband’s Response to an Application in a Proceeding sealed 14 April 2023 do otherwise stand dismissed.

3.That there be no order as to costs in respect to the said Application in a Proceeding and the Response to an Application in a Proceeding.

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).

Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish 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 Closs & Closs has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

REASONS FOR JUDGMENT

JUDGE McGINN

INTRODUCTION

  1. Before the Court is the wife’s Application in a Proceeding filed on 17 March 2023.

  2. By that Application in a Proceeding the wife seeks payment to her of the sum of $70,000 paid to her solicitor’s trust account for the purpose of meeting legal fees and disbursements.

  3. The Application does not disclose what power is to be exercised in making that order.

  4. The respondent husband by his Response to an Application in Proceeding filed 14 April 2023 seeks dismissal and costs.

  5. In terms of substantive applications, the parties have a pending trial in August 2023 of their respective property settlement and parenting applications.

  6. The matter is due to come before the Court on 18 May 2023 for trial management directions.

  7. The parties separated in 2018 after 18 years of cohabitation. They have one child aged 11 years.

    THE WIFE’S EVIDENCE

  8. The applicant wife by her affidavit in support of the Application sets out that:

    (a)the wife has been informed by her solicitor that they estimate her legal fees for trial preparation and trial to be in the vicinity of $75,000 as set out in a costs notice of 16 March 2023 and have requested that the amount be paid by her to the solicitor’s trust account;

    (b)the wife has been told her solicitor that they are not prepared to await property settlement for the payment of fees;

    (c)the wife says her financial circumstances are parlous in that;

    (i)her income is $512 per week;

    (ii)the expenses (not specified) exceed income;

    (iii)the child support is assessed to be paid at $62 per week and is in arrears by an amount exceeding five and a half thousand dollars; and

    (iv)her savings are $21.

    (d)the husband’s financial circumstances are relatively strong he having retained all assets of significance as at separation being December 2018.

    (e)As at 15 March 2023 the husband had:

    (i)$78,509 in his Bank B account ending …40;

    (ii)$361,987 available through his late mother’s estate which he said was on 4 July 2022 “available to me if I requested” and a balance sheet sealed 19 August 2022 states the husband has $286,988 in his mother’s estate.

    (f)as to her legal costs incurred to the date of application, the wife:

    (i)has paid as at the date of her affidavit of 16 March 2023 a total of $148,741 in legal fees, has paid legal fees to her present solicitor since of $15,404, is indebted to them in the sum of $4,632 and has work in progress in a matter which is unbilled of $15,000;

    (ii)has principally funded the litigation by borrowings from her parents and such amounts are to be repaid upon her property settlement. As at 16 March 2023 she owes her parents approximately $206,000. The wife has been informed that her parents are not in a financial position to lend her further funds understood to be necessary for the litigation to be concluded by lawyers.

    (g)the husband’s legal costs as at 17 March 2023 by his costs notice of 16 March 2023 were a paid amount of $235,500 said to be paid from personal bank accounts.

    THE HUSBAND’S AFFIDAVIT EVIDENCE

  9. The husband by his affidavit sealed 14 April 2023 claims no income and no property from which he can meet the order now sought by the wife.

  10. At paragraph 11 of his affidavit he admits that as at 1 June 2022 he had $361,987 available from the inheritance he had received from his late mother’s estate. It is to be noted that in that paragraph he says that the amount had been received and was not just an entitlement.

  11. Of those inherited monies:

    (a)$75,000 was applied to both parties’ legal fees on 8 August 2022;

    (b)$35,000 was applied to the husband’s legal fees on 20 August 2022;

    (c)$45,000 was applied on 25 August 2022 to the husband’s legal fees and in compliance of a costs order of 23 August 2022;

    (d)$20,000 was applied to the husband’s legal fees on 4 October 2022;

    (e)$10,000 was applied to the husband’s legal fees and his other expenses on 7 November 2022;

    (f)$5,500 was applied to the husband’s legal fees on 21 November 2022; and

    (g)$50,000 was applied to the husband’s legal fees and his other expenses on 18 March 2023;

  12. The total of the inherited monies expended amounts to $240,500 of which $228,453 was applied to legal fees.

  13. Of those monies applied to legal fees, the husband applied $174,500 to his own legal fees and $53,953 to the wife’s legal fees.

  14. In addition to that $53,953, the husband has also paid $20,000 to the wife pursuant to orders made on 20 December 2019 (the character of which is yet to be determined) and $10,000 on 20 May 2020 (characterised as partial property settlement).

  15. Of the inherited monies of $361,987 this leaves an amount of $121,487.

  16. On 4 and 6 April 2020 $125,000 was paid to the husband’s solicitor’s trust account. Of this $113,931 remains according to his affidavit. This amount has further fallen on account of the payment of legal fees by reference to his Outline of Case.

  17. The husband has been given a solicitor’s estimate of fees and disbursements of $135,067.

  18. The husband says his solicitors have made it “quite clear” that unless all funds currently in his trust account remain there to pay fees and disbursements, they will not be acting for him at the trial of this matter.

  19. The husband cannot borrow moneys because of caveats that the wife has put in place over property in the husband’s name.

  20. On 6 March 2023 the wife first disclosed existence of a copy of the loan agreement with her parents.

    THE HUSBAND’S OUTLINE

  21. The husband has filed an outline of argument 5 May 2023. I have read and considered it. The important matters in the submissions in that outline comprise:

    (a)that the section of the Family Law Act 1975 (Cth) (the “Act”) under which the application is made has not been identified;

    (b)that the applicant wife has not satisfied the criteria for an interim property order in that;

    (i)she has not set out the matters pursuant to s 79 that need to be considered:

    (ii)there needs to be an assessment of the “adjustment” issue or “clawback issue”; and

    (iii)the parties’ relative financial strengths.

    (c)that the wife has not set out what is required by an order to be made under s 117 because the applicant has not shown that:

    (i)one party is found to be in a position of greater financial strength than the other;

    (ii)the respondent has capacity to fund his legal costs; and

    (iii)the applicant does not have the capacity to fund her legal costs.

    (d)that the borrowings from the wife’s parents is a recent disclosure that should not be accepted;

    (e)that the wife can be represented at trial because funding pursuant to s 102NA may be made available;

    (f)that whilst the husband is the owner of valuable rural property and associated assets he cannot borrow because of the caveats lodged by the wife. He omits to make reference to orders with injunction made on 20 May 2020 which, amongst other things, restrain the husband by way of injunction from selling disposing encumbering transferring or in any way dealing with the properties which constitute the farm without the prior written consent of the wife.

    THE WIFE’S OUTLINE

  22. The applicant submitted written submissions at the commencement of the hearing on 8 May 2023 following an earlier unsuccessful, endeavour to forward them to my associate by email on the morning of the hearing. It was an unfortunate case of the Central Practice Direction being honoured in the breach rather than by compliance. Nevertheless no objection was taken to that outline coming before the Court and I have considered it.

  23. Of the applicant wife’s outline, the matters of significance in my view are:

    (a)that the matter is listed for trial on 14 August 2023 for 5 days;

    (b)a recitation of the wife’s financial position as set out in her supporting affidavit and submitting that the effect of that evidence is that the wife can expect to be indebted to a legal representatives at the conclusion of trial for the sum of $94,600;

    (c)that at the date of the wife’s filing of the Application the husband had:

    (i)$78,500 in his Bank B account which has been diminished by $33,500;

    (ii)that as at July 2022 by the husband’s trial affidavit he was entitled to $361,987 from his late mother’s estate and has drawn down:

    (A)$235,000 in respect of his own legal fees;

    (B)$53,953 in favour the wife’s litigation funding and expenses;

    (C)$5000 in respect of sundry expenses including refrigeration repairs.

    (d)that after the wife’s Application in a Proceeding was filed the husband repaid his father the sum of $30,000 on account of moneys borrowed from his father of the legal fees. This has emptied his Bank B account;

    (e)that this reckoning leaves some $68,000 unexpended;

    (f)that the husband is due to receive two lease payments of almost $34,000 plus GST on 1 July 2023 and January 2024;

    (g)that the husband’s claim of income and expenditure leaves unaccounted for, a lease payment of approximate $34,000 plus GST due on 1 January 2024;

    (h)that certain of the husband’s proposed legal expenditures (in particular for an expert to engage the authenticity of the loan agreement between the wife and the parents of 18 January 2020 and “new trial affidavit material”) should be regarded as unnecessary;

    (i)although not set out in the Application, that the Court might contemplate that each party receives one half of the funds held by the husband’s solicitor to ensure that each party is represented at trial or those trust monies be divided equally pending the sale of that part of the farming land which is to be sold as sought by the husband in his “specific orders sought at trial” filed 15 September 2023;

    (j)that the wife bears the onus to satisfy the Court that orders which she seeks should be made;

    (k)that the wife will receive an amount far in excess of $75,000 at trial;

    (l)that an order for litigation funding under s 79 or s 117 can be made pursuant to s117 if this Court is first satisfied that the application is genuine, circumstances which identify the power are apparent and to bring to account the need of making an order as against the benefit of only having one exercise of a s 79 or s 117 power.

    (m)that an order to be made by way of partial property settlement order involves two stages:

    (i)firstly, considerations as to whether the Court should exercise discretion to entertain the Application (which does not require compelling circumstances); and

    (ii)secondly, whether it is appropriate to exercise power; and

    (n)that the wife should not find herself unrepresented at trial where the husband’s solicitors have already been paid an amount of $98,000.

    THE ORAL SUBMISSIONS

  24. In the course of oral submissions it was conceded that the amount which the wife sought would not in any way compromise that which ultimately would be recovered by her at trial with respect to her application for property settlement.

  25. The Court takes this acknowledgement as meaning that the payment to the wife of the $70,000 as sought in her Application does not prejudice the final applications for property settlement to be determined Court and the wife properly has put before the Court a case for substantive relief. Implicit in adopting this position is that the wife is only seeking access to what she is inevitably to obtain in due course to pay the legal fees as they are presently incurred for the purposes of taking the matter to trial.

  26. In the course of submissions, it was apparent that there is a factual dispute between the parties as to whether there is a child support arrears of approximately $5500 due to the wife by the husband. Whether child support has been paid as required or whether arrears persist is a matter of little or no weight. The present Application goes forward on the basis that the wife is the full-time carer of the parties only child X aged 11 years and is entitled to receive the $58 per week on account of his support.

  27. The husband submitted that the Application should not be granted for a number of reasons and emphasised that the applicant’s case was made late, not made out on account of lack of particularity in relation to the costs to be sustained contrary to authority, without adequate explanation as to the now lack of availability of funding from her parents (contrary to what had been a long established past practice) for legal fees, and that the husband did not have available to him an ability to borrow given his lack of income to support any such borrowing and the existence of caveats (if not the injunctive orders made in this Court). The husband also asserted that in any event, he had not been approached by the wife to make any of the caveated land available as security for borrowings to provide funds to the wife.

  28. The husband’s counsel also indicated that there are pending proceedings in the Magistrate’s Court concerning the father’s alleged behaviour towards X. The financial or other demands this places upon the husband were not set out in his supporting affidavit.

    THE INTERIM OR PARTIAL PROPERTY SETTLEMENT APPLICATION

  29. Whilst it is true that an application for a partial property settlement can be entertained where a party requires litigation funding, the making of such an order requires more than just the existence of that requirement.

  30. What is sometimes referred to as the adjectival procedural step requires the Court to be satisfied that there exists an appropriate reason for a partial order for property settlement to be made.

  31. Where each of the parties face significant legal costs, such an application can be maintained. Here each of the parties are said to face significant legal costs in taking this matter to trial and the inability of either of them to do so may cause an injustice.

  32. Here, the injustice arises because the proceedings have had a complicated and lengthy history on account of:

    (a)an inability of the husband and/or his agents in preparing to address the question of property settlement at trial when last listed for trial;

    (b)the introduction of competing parenting applications involving serious allegations and necessitating the appointment of an Independent Children’s Lawyer arising soon after a postponement of the property trial; and

    (c)it being desirous if each of the parties could be legally represented (as the each wish to be) for the purposes of the trial in this matter.

  33. On 20 May 2020 an order for partial property settlement was made with the consent of the parties with respect to payment to the wife’s solicitor’s trust account. I infer that was on account of providing assistance with the wife’s then legal fees.

  34. Otherwise, by agreement monies have been advanced to assist with the wife’s legal expenses in the sum of $40,000 on 8 August 2022.

  35. The husband holds and uses the significant assets and the source of income that was otherwise available to the parties during the course of the parties’ relationship.

  36. In submissions it was said that the wife holds about $8,000 out of a pool of about $3.5 million[1] the balance of which is held, subject to orders,[2] by the husband. That submission was not cavilled with.

    [1] Cf the “Joint Schedule of Assets and Liabilities” filed by the husband 5.12.2022.

    [2] Order 2 of the Orders made 20 May 2020.

  37. Whether that in fact be the case or not, I find that the husband is in a significantly superior position to meet, without the assistance of others, the majority of his ongoing and anticipated legal fees and expenses.

  38. The husband says his legal expenses to trial are anticipated to be $135,067. He provides a relatively detailed breakdown of those expenses. The wife broadly says her solicitor’s estimate fees are in the vicinity of $75,000 without any breakdown.

  39. It was said that the lack of detailed breakdown of costs should be fatal to the wife’s Application.

  40. An explanatory breakdown of costs supporting the order for partial property settlement was said by the husband to be essential to the success of the Application and in its absence the Application should be dismissed.

  41. The Court was referred to the decision of Kramer & Kramer [2023] FedCFFamC2F 221.

  42. That authority, whilst of assistance generally, does not specifically assist me with this proposition.

  43. The detail that is provided in identifying the costs sought goes to determining whether the Application is bona fide as part of the adjectival or procedural step.[3] Hence, it said that such evidence “may”[4] be needed if interim property settlement orders are sought for litigation costs.

    [3] Strahan & Strahan (Interim Property Order)[2009] FamCAFC 166; (2011) FLC 93-466 (“Strahan”) at [138] per Boland and O’Ryan JJ.

    [4] Strahan at [141] per Boland and O’Ryan JJ.

  1. It has been recognised that any quantum so claimed by reason of costs has been variously described as “necessarily limited and impressionistic budget”[5], “likely costs of the litigation”[6], “supported by adequate and detailed evidence”[7] and that the evidence as to the amount sought is to be provided as a Court cannot speculate as to the amount.[8]

    [5] Strahan at [138] per Boland and O’Ryan JJ.

    [6] Wilson & Wilson (1989)FLC 92-033 (“Wilson”) at 77,449 – 7,450 per Kay J.

    [7] Zschokke and Zschokke (1996) FLC 92-693 at 77,453 per Strauss J (insofar as a s117 application is maintained).

    [8] Wilson at 83, 212.

  2. The required level of detail arises as there is a need to ensure that the amount awarded is applied towards costs. How an amount is determined and what level of detail is required turns upon the circumstances of a particular case and, in particular, where there is a claim of a lack of bona fides about the bringing of the application[9] and the terms of any order that delimits the manner of expenditure of funds awarded.[10] A lack of detail or delimiting of the application of monies sought can lead to an inference that awarded monies may not necessarily be applied to costs.

    [9] Strahan at 85,648, [147] per Boland and O’Ryan JJ.

    [10] Strahan at 85,649 [153] per Boland and O’Ryan JJ.

  3. Here, the order sought was for the payment of monies to the wife’s solicitor’s trust account for the purpose of paying legal fees and disbursements.

  4. The matter is listed for trial for five days in relation to the question of property settlement and parenting matters.

  5. The wife’s breakdown of fees by her costs notice of 16 March 2023 is $35,000 solicitor’s costs and $40,000 for counsel fees.

  6. The husband’s evidence as to his costs associated with “costs of trial preparation in the days leading up to trial” includes attendances at trial as $24,200 for solicitor’s fees and counsel fees of $30,250. Preparation fees are $13,200 and $16,500 respectively.

  7. The costs of this “lead up” give totals not dissimilar for the figures found in the wife’s costs notice for her solicitor and counsel fees.

  8. Insofar as to the quantity the wife has claimed for costs lacks detail, it does not lack a certain parity and a sense of proportionality to those costs to be incurred by the husband. In this sense, the wife’s claimed costs can be considered against the proposed costs expenditure set forth by the husband.

  9. The Schedule 1 scale of costs under the Federal Circuit and Family Court of Australia Rules 2021 (the “Rules”) would indicate solicitor’s and counsel’s costs for a 5 day trial would be about $27,900. Here, the husband has determined to pay fees other than provided by any scale to retain solicitors and the wife can be inferred to be seeking to do the same.

  10. Provided that any monies are to be applied to the payment of legal costs, the amount claimed by the wife has, in my view, sufficient particularity to permit her Application to be regarded as bona fide and not so excessive as to give rise to an inference that the claim is not bona fide.

  11. I do not accept the submission that in the circumstances of this case the failure to provide a detailed breakdown of the costs claimed is fatal to the wife’s application.

  12. I am satisfied that the procedural or adjectival step is satisfied in relation to the wife’s claim insofar as it is characterised as a claim for an interim property settlement order.

  13. The second step in relation to the claim for an interim property settlement order is that the Court needs to be satisfied that the order sought or something like it would be made given the requirements of s79. In assessing whether the requirements of s79 are met and to what extent to permit the application, it is to be borne in mind that the provisions of s79 have to be applied “with limitations”[11] as the determination on an application such as the present,“brief”[12] and not a final hearing.

    [11] Strahan at 85,646 [135] per Boland and O’Ryan JJ

    [12] Strahan at 85,646 [137] per Boland and O’Ryan JJ

  14. The brevity of the hearing can be facilitated if it can be established that it seems likely that the amount sought to be paid is likely to be received by way of property settlement at the final hearing.

  15. Here, the concession has been properly made that the amount sought by the wife would not prejudice the outcome of the final hearing in the sense that the wife will recover at least that which is sought by her for costs at the final hearing.

  16. Given that concession, it can be taken to be just and equitable for the purposes of s 79(2) that an order for property settlement be made. Even in the absence of such a concession, the parties’ separation and consequent competing applications for property settlement in the context of a relationship of 18 years of duration in all the circumstances indicates that this requirement is met.[13]

    [13] Cf Stanford v Stanford (2012) FLC 93-518 at [42] per French CJ, Hayne, Heydon, Kiefel (as Her Honour then was) and Bell JJ.

  17. Similarly, the matters as to the extent of the asset pool, contributions and other factors to be brought to account under ss79(4)(d) to (g) can be taken to have been satisfied to as to be able to justify an order in the quantum sought by the wife.

  18. However, the difficulty in this matter arises as to the nature of the order that is to be made that at this point in time serves the just and equitable requirement of s 79 and is permitted under s 80.

  19. Considerations of convenience and prejudice come to be weighed in considering the type of interim order that might be made.

  20. By his affidavit of 14 April 2023 the husband tells the Court that there is in excess of $113,000 in the husband’s solicitor’s trust. His written outline of 5 May 2023 tells the Court that that amount is reduced by about $6,300 such that as at the date of that outline there is about $107,600 in his solicitor’s trust account. As indicated in the husband’s affidavit, the monies are being drawn down to pay his legal fees and keep them up to date.

  21. The monies held in the husband’s solicitor’s trust account are otherwise for costs to be yet incurred.

  22. The husband has had it made clear to him that unless all the funds in the trust account remain there to pay all fees and disbursements, his solicitors will not be acting for him at the trial of this matter. The husband has had his present solicitors act for him since about August 2022. Before that he had solicitors acting for him from about January 2021. He has had a number of counsel including senior counsel appear for him from time to time in the course of the proceedings.

  23. The husband’s solicitors, unless they revise their position, may well not be acting for him at trial.

  24. The wife similarly has also been told that her solicitor and counsel are not prepared to await her receipt of her entitlements by way of property settlement for payment.

  25. The wife has had two solicitors act for her since the proceedings were commenced by her in December 2019 and a number of counsel appear for her.

  26. Unless the wife’s solicitor and counsel also revise their positions, they may not be acting for her at trial.

  27. Each of the parties should, if at all practicable, have legal representation at trial and that is the preferable outcome. However, in arriving at trial there needs to be forensic and legal skills applied and in a way that saves costs at trial.

  28. The Rules require[14] of practitioners and parties for disputes to be resolved according to law as quickly, cheaply and efficiently as possible. This means identifying and preparing to address genuine issues in dispute by identifying the most cost efficient method of addressing those issues.[15] This inevitably means that consideration and preparation of the identification and addressing of issues needs to be undertaken prior to trial.

    [14] Federal Circuit and Family Court of Australia Rules 2021, Rule 1.04.

    [15] Central Practice Direction – Family Law Case Management 1.5, 3.13, 3.14, 5.10(c), 5.13, 5.55(f), (h), 5.58(a).

  29. It is ideal and preferable that such tasks be undertaken by the parties with the assistance of legal representation.

  30. However, that preferred position cannot displace the wife’s proper entitlements to property settlement orders.

  31. Beyond the husband’s anticipated solicitor’s and barrister’s costs leading up to trial referred to above, the husband’s other costs and disbursements are anticipated to come to $50,850.

  32. Orders of 20 May 2020 restrain the husband in the absence of the wife’s written consent from dealing with the land the subject of property settlement claim, which makes up the bulk of the pool of assets, in various ways.

  33. Other assets and income are and have been utilised by the husband to meet expenses (including periodic support of the wife and child support) and legal expenses.

  34. His reliance on family financial support has been relatively confined to what appears to be $30,000 and he has been in a position to repay it since the filing of the present Application.

  35. In addition he has also been in the position since the filing of the present Application to pay $15,000 to his solicitor’s trust account for outstanding costs and disbursements.

  36. In contrast, the wife has been extensively reliant on family support to the extent of $206,000 or thereabouts. The wife has paid about $149,000 in legal fees. $50,000 of that amount has been funded by the husband. The balance of about nearly $100,000 has been supplied by the wife’s parents.

  37. The husband criticises the wife’s case in that the evidence she now brings forward as to the cessation of her parent’s support is general is lacking weight as there is no affidavit of the wife’s parents or either of them about the claimed previous support and its cessation.

  38. There is no evidence of any obligation for family members to provide financial support for the payment of either of the parties’ legal fees whether by loan or gift.

  39. The provision of the wife’s costs notices filed since September 2022 have recorded that in addition to monies provided by way of interim payments and joint funds held at separation, the wife has been paying legal fees with funds loaned from her parents. The proceedings have been on foot since the wife initiated the proceedings in December 2019.

  40. The wife’s evidence is that her mother is not in a financial position to continue to provide funds to fund the wife’s litigation. It was said that this evidence should not be taken to be of sufficient weight to persuade the Court in respect of the making of an interim property settlement application. This is a submission to which I attach no weight given that the wife’s parents are under no obligation to provide monies to the wife to fund her litigation expenses and the wife otherwise has a proper entitlement to monies.

  41. The other matter raised by the husband is that the application has been brought relatively late in the proceedings. That may be so, but the wife’s claim should not be denied on that score given that although late, the husband has been able to answer the Application. I consider that although there may need to be a reconsideration of the arrangements as to legal representation going forward, sufficient time exists for alternative arrangements in that regard to be considered and given effect to.

  42. I consider that the mooted prospect of funding being available pursuant to a scheme administered pursuant to s 102NA of the Act to be in the light of submissions received somewhat speculative and in any event a matter of no weight where a party is seeking to maintain her own arrangements and avoiding a call on the public purse.

  43. In all of the circumstances I consider that it is just and equitable that an order be made pursuant to s 79 by way of an interim property settlement order and that the husband pay the wife the sum of $50,000 such sum to be paid to the wife’s solicitor’s trust account and to be applied to the costs and disbursements of the present Applications before this Court.

  44. Having determined that orders can and should be made pursuant to s 79 there arises no need for me to consider the alternative basis that orders should be made pursuant to s 117.

  45. Each of the parties seek an order for costs in respect of their Applications. I received no specific submissions in that regard. Given the extent of the success of the wife’s Application, the financial circumstances of each of the parties and the effect of the orders now made, I would decline to depart from the general position that each party bear their own costs of the present Application.

  46. For these reasons there shall be orders as set out at the commencement of these reasons.

I certify that the preceding eighty-nine (89) numbered paragraphs are a true copy of the Reasons for Judgment of Judge McGinn.

Associate:

Dated:       12 May 2023


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Stanford v Stanford [2012] HCA 52