CRAIG & CRAIG

[2006] FamCA 1272

FAMILY COURT OF AUSTRALIA

CRAIG & CRAIG [2006] FamCA 1272

FAMILY LAW – APPEAL – COSTS – Appeal allowed from Federal Magistrate – Court to grant costs certificates to the parties under s 9, s 6 and s 8 of the Federal Proceedings (Costs) Act 1981

Family Law Act 1975 (Cth)

Greedy (1982) FLC 91-250
Fitzgerald v Fish (2005) 33 Fam LR 123

APPELLANT:  CRAIG

RESPONDENT:  CRAIG

FILE NUMBER:  BRM 5919 of 2004

APPEAL NUMBER:  NA 87 of 2005

DATE DELIVERED:  28 November 2006

PLACE DELIVERED:  Brisbane

JUDGMENT OF:  May J

HEARING DATE:  By way of written submissions

LOWER COURT JURISDICTION:  Federal Magistrates Court

LOWER COURT JUDGMENT DATE:                31 October 2005

COUNSEL FOR THE APPELLANT: Mr O’Neill

SOLICITOR FOR THE APPELLANT: Stacks Gray Solicitors

SOLICITORS FOR THE RESPONDENT:

Frank Carroll

Solicitor

ORDERS

1. The Court grants to the appellant a costs certificate, pursuant to s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate stating that in the opinion of the Court it would be appropriate for the Attorney-General to authorise a payment under the Act to the appellant in respect of the costs incurred by the appellant in relation to the appeal.

2. The Court grants to the respondent a costs certificate, pursuant to s 6 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate stating that in the opinion of the Court it would be appropriate for the Attorney-General to authorise a payment under the Act to the respondent in respect of the costs incurred by the respondent in relation to the appeal.

3. That the Court grants to each party a costs certificate pursuant to the provisions of s 8 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to each party in respect of such part as the Attorney-General considers appropriate of any costs incurred by each party in relation to the new trial granted by these orders. 

IT IS NOTED IN CONNECTION WITH THESE ORDERS that the judgment of the Full Court delivered this day will for all publication and reporting purposes be referred to as Craig and Craig.  

FAMILY COURT OF AUSTRALIA  AT BRISBANE

APPEAL NUMBER:          NA 87 of 2005

FILE NUMBER:                  BRM5919 OF 2004

CRAIG
Appellant Wife

And

CRAIG
Respondent Husband

REASONS FOR JUDGMENT

Introduction

1. The substantive appeal in this matter was delivered on 3 August 2006, in which the appeal was allowed, and time limits were provided for the parties to make submissions in writing as to the issue of costs. 

2. The appellant filed written submissions as to costs on 29 August 2006, and the respondent on 10 October 2006. Each were out of time.

3. The appeal was allowed for the reasons expressed in the judgment in paragraphs 62, 63 and 64. This reveals an error of law on behalf of the trial Judge and mistakes made by the lawyers conducting the case for each party.

Appellant’s Submissions

1. The application by the appellant husband seeks the costs of the appeal on an indemnity basis. The appellant submits that the granting of such costs is appropriate under s 117 of the Family Law Act 1975 (Cth), with due regard to the factors set out in s 117 (2A) of the Act.

2. In support of the husband’s application, his counsel refers to the appellant’s “materially weaker financial position”, referred to at paragraph 28 of the appeal judgment.   The appellant currently lives on a pension while the respondent retains her business.

3. The appellant’s counsel also refers to the “wilful refusal” of the respondent to meet her obligations as to the discovery of relevant material and that her financial statement bore “no resemblance” to her actual financial position.  In particular, it was submitted that the non-disclosure of multiple bank accounts in her name was only discovered through the subpoena of non-parties such as banks.  The appellant husband alleges that a letter of communication from a chartered accountant, dated 27 January 2006 was only disclosed to the appellant’s solicitors on 7 August 2006, preventing an application to adduce further evidence on a matter than was directly relevant to a major issue of the trial and appeal.

4. Although the respondent did not directly ignore any Court orders, the appellant’s counsel refers to an apparent “implied disregard” for the orders through non-compliance with the provisions of Part 13 of the Family Law Rules, as discussed above.

5. It was submitted that as the appeal succeeded on three of the four separate grounds on which it was advanced, the appellant was “wholly successful”.

6. It was claimed that the matter was unduly prolonged and the responsibility for this lies wholly with the respondent wife.  It is submitted that an award of costs on a party and party basis would ease some of the appellant’s financial burden, particularly given the order for a retrial.

Respondent’s Submissions

1. The respondent wife seeks that the husband’s submissions be dismissed because they were delivered out of time.  In the alternative, her solicitor argues there is no reason to depart from the general rule that each party should bear their own costs.

2. It is submitted that the wife’s financial circumstances are not significantly different from those of the husband. It was said that any substantial difference between the parties was due to the difference in value of the residence they chose after an earlier oral agreement distributed their “modest wealth”.  The respondent financed her own costs of this appeal.

3. The respondent wife disputes the claim that her conduct was obstructing, particularly with reference to the appellant’s claim of non-disclosure.  The wife’s solicitor asserts the husband failed to assist in the task of making full disclosure to the trial judge.  Furthermore, the respondent submits that she made every reasonable effort to reconcile the parties’ financial records, including having a written report from the chartered accountant, submitted to the Court.

4. The respondent wife submits that the appeal was allowed for reasons other than the conduct or merit of her case.  Furthermore, she asserts that her conduct was not responsible for the lengthy duration of the trial and appeal. 

Appellate Principles in Relation to Costs

1. The general rule, under s 117(1) of the Family Law Act 1975, is that each party shall bear their own costs. This principle is subject to the exceptions under s 117(2). Under this section, the Court may consider the relevant circumstances of the case to determine whether the making of a costs order would be justified.

2. The matters a judge “shall have regard to” in considering what order should be made under subsection (2) are:

   s 117(2A)

   (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 the 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.

1. Although s 117(2) provides that the court must be of the opinion that the circumstances justify an order for costs, the court does not need to provide detailed reasons for its decision. Provided there are reasons on which the Judge could rely, an exercise of discretion will not be disturbed (Greedy (1982) FLC 91-250).

2. The basis for finding such justifying circumstances may be on any one basis alone.  In the recent case of Fitzgerald v Fish (2005) 33 Fam LR 123, the Full Court held that there is nothing to prevent any factor from being the sole foundation for an order for costs. In that judgement their Honours said the following:

   41. “Nowhere in [subsection] 2(A) or elsewhere in section 117, is there any prescription that more than one factor must be present before an order for costs is made nor of comparative weight of the factors set out in [subsection] 2(A).  As a consequence, there is nothing to prevent any factor being the sole foundation for an order for costs.”

Conclusion

1. If indemnity costs are being sought no exceptional circumstances exist in this case for such an order to be made. Whilst it is true that there are valid criticisms of how the case for the wife was presented it is also correct that to a considerable degree the appeal was allowed as a result of error on the part of the trial Judge. The most appropriate order in this case is that each party receives a certificate for their costs of the appeal together with a certificate for the new trial.

I certify that the preceding [18] paragraphs
are a true copy of the reasons for judgment delivered by this Honourable Full Court.


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