Decker & Decker (No 2)
[2022] FedCFamC1F 767
Federal Circuit and Family Court of Australia
(DIVISION 1)
Decker & Decker (No 2) [2022] FedCFamC1F 767
File number(s): SYC 6644 of 2021 Judgment of: WILSON J Date of judgment: 10 October 2022 Catchwords: FAMILY LAW – MAJOR COMPLEX FINANCIAL PROCEEDING LIST – COSTS – indemnity costs sought – no exceptional circumstances found – costs order made on a party/party basis – no costs orders made in relation to the costs application Legislation: Family Law Act 1975 (Cth) ss 79A 117(1) and 117(2A)(e) Cases cited: Decker & Decker [2022] FedCFamC1F 563
Fitzgerald v Fish (2005) 33 Fam LR 123
Garston & Yeo [2022] FedCFamC1F 235
Hatcher v Cohn (2004) 139 FCR 425
In the Marriage of Kohan (1992) 16 Fam LR 245
Mansfield & Mansfield [2019] FamCAFC 186
Medlon v Medlon (No 6) (2015) 54 Fam LR 1
Stasiuk & Guild [2021] FamCAFC 62
Warin & Warin (No 6) [2022] FedCFamC1F 457
Zheng & Cheung [2022] FedCFamC1F 249
Division: Division 1 First Instance Number of paragraphs: 18 Date of last submission/s: 22 September 2022 Date of hearing: Decided on the papers Place: Melbourne Counsel for the Applicant: Written submissions on behalf of the wife Solicitor for the Applicant: Barkus Doolan Winning Counsel for the Respondent: Written submissions on behalf of the husband Solicitor for the Respondent: Uther Webster & Evans ORDERS
SYC 6644 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR DECKER
Applicant
AND: MS DECKER
Respondent
order made by:
WILSON J
DATE OF ORDER:
10 October 2022
THE COURT ORDERS THAT:
1.Pursuant to s 117(2) of the Family Law Act, the husband must pay the wife’s costs of and incidental to the husband’s unsuccessful application to summarily dismiss the wife’s s 79A application the subject of my reasons in Decker & Decker [2022] FedCFamC1F 563 on a party/party basis.
2.Forthwith the registrar is to assess party/party costs referred to in paragraph 1 herein.
3.The further conduct of this proceeding is referred to the Honourable Justice Harper.
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 has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
WILSON J
Introduction
Subsequent to the handing down of judgment on 11 August 2022, the wife applied by application in a case dated 25 August 2022 for orders requiring the husband to pay her costs of and incidental to his unsuccessful summary dismissal application under s 79A of the Family Law Act.
She claimed the sum of $68,267, being indemnity costs.
Alternatively, she sought costs on a party/party basis as well as her costs of and incidental to this costs application.
In support of these costs applications, the wife relied on s 117(2A)(e) of the Family Law Act contending that the husband was wholly unsuccessful in his s 79A application.
The husband opposed the wife’s costs application. He argued –
(a)prior to the wife filing her application for costs the wife sought payment of $57,000 and when the husband requested a tax invoice in that sum the wife did not provide one; and
(b)on 8 September 2022 the husband filed his response to the wife’s costs application seeking orders that he pay the wife her costs on a party/party basis effectively consenting to paragraph 2 of the wife’s costs application.
For the reasons that appear below, in my view costs should be ordered on a party/party basis, not on an indemnity basis. A registrar must assess those costs. Costs of this costs application are to be his and her own costs.
The wife’s evidence on this costs application
So far as her affidavit sworn 25 August 2022 related to costs, the wife deposed to events prior to and subsequent to the judgment delivered 11 August 2022. The more important matters were as follows –
(a)on 27 July 2021 the wife received a costs agreement from her solicitors;
(b)on 7 August 2019 the wife received a costs disclosure and agreement from her King’s Counsel;
(c)the total combined costs of the wife’s solicitors and one of her counsel is $68,267; and
(d)the wife has paid a further $13,200 in relation to the fees of another barrister retained on the wife’s behalf.
Self-evidently, the sum of $68,267 is the wife’s solicitor-own-client costs. Those are not assessed costs or taxed costs nor are they party/party costs.
The wife’s submissions
The wife’s written submissions prepared by her solicitor recorded in paragraph 7 that the husband agreed to pay the wife’s costs in his response filed 8 September 2022 and that the only contentious issue was the basis of those costs.
The wife sought an order for her costs to be paid on an indemnity basis. She contended that the husband had been wholly unsuccessful on his s 79A dismissal application for the purposes of s 117(2A)(e). The learning in the family law area in relation to the imposition of indemnity costs provides that such an order is to be made in exceptional circumstances.[1] So far as exceptional circumstances were concerned, the wife’s solicitors wrote the following terms between paragraphs 17 to 20 of those submissions –
17.The case has elements that itself make it exceptional and warranted the experience of Kings Counsel, making it fall outside of a case where scale would accommodate a party's costs incurred or come close. It is noted that both parties engaged Senior Counsel for all Hearings related to the Husband’s Application in a Proceeding, including Directions Hearings save for the Direction Hearing on 13 April 2022 (in which both parties solicitors appeared).
18.Further, it is noted that whilst the Wife engaged two King Counsels, she not (sic) seeking the payment of the costs she incurred to obtain advice from [Ms Q] in relation to the Husband’s Application in a Proceeding.
19.The Wife’s incurred costs pursuant to the terms of the Costs Agreement she entered into with her solicitors Barkus Doolan Winning and those costs are outside that provided by scale and greater in quantum.
20.Consistent with the authorities referred to in Munday & Bowman [1997 FLC 92-748] all of the above features make this case one where the trial Judge should use his and/or her discretion and depart from the ordinary course and award the Wife indemnity costs.
[1] Stasiuk & Guild [2021] FamCAFC 62; Medlon v Medlon (No 6) (2015) 54 Fam LR 1; In the Marriage of Kohan (1992) 16 Fam LR 245; Mansfield & Mansfield [2019] FamCAFC 186; Zheng & Cheung[2022] FedCFamC1F 249 and Garston & Yeo[2022] FedCFamC1F 235.
In Warin & Warin (No 6)[2] I held, consistent with the observations of Kiefel J (as the Chief Justice then was) in Hatcher v Cohn,[3] that “exceptional” meant out of the ordinary. The matters urged in paragraphs 17 to 20 of the wife’s solicitor’s submissions did not go very far to demonstrating that the costs of this application should be regarded as out of the ordinary. The fact that the approximate value of the property pool was over $60 million said nothing of exceptional circumstances for the purpose of s 117(2) of the Family Law Act. The fact that the wife chose to retain two silks and solicitors whose rates are beyond scale does not convert this case to one warranting the imposition of indemnity costs.
[2] [2022] FedCFamC1F 457.
[3] (2004) 139 FCR 425.
I decline to order indemnity costs. The wife has successfully invoked s 117(2A)(e) of the Family Law Act. According to Fitzgerald v Fish[4] one subsection only need be invoked to warrant an order that deviates from the more usual order under s 117(1). But the fact of making an order under s 117(2) does not mean that costs so ordered are indemnity in nature. The costs to be paid by the husband are party/party costs to be taxed in default of agreement.
[4] (2005) 33 Fam LR 123.
That then left the costs of this costs application. The husband offered in his response to pay costs on a party/party basis of his failed application about the summary dismissal of the initiating application. I have addressed that above. As for the debate on this application for costs –
(a)the wife failed on her indemnity costs application; and
(b)the husband argued that the wife failed to honour some alleged agreement to the effect that if agreement was not reached on costs they were to be assessed and upon an agreement or assessment being made the payment was to be made within 28 days.[5]
[5] Paragraph 18 of the husband’s written costs submissions.
Not only was that last point highly confusing but at best it was some form of conditional agreement.
In my view the wife was not entitled to an order requiring the husband to pay her costs. Each party should bear his and her own costs of the costs debate.
Orders
In those circumstances, it is appropriate to make orders that pursuant to s 117(2) of the Family Law Act, the husband pay the wife’s costs of and incidental to the husband’s unsuccessful application to summarily dismiss the wife’s s 79A application, the subject of my reasons in Decker & Decker[6] on a party/party basis.
[6] [2022] FedCFamC1F 563.
I direct the registrar to forthwith assess those party/party costs
The further conduct of this proceeding is referred to the Honourable Justice Harper.
I certify that the preceding eighteen (18) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Wilson. Associate:
Dated: 10 October 2022
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