Dixon & Young (No 2)
[2023] FedCFamC1F 780
•14 September 2023
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Dixon & Young (No 2) [2023] FedCFamC1F 780
File number(s): SYC 7372 of 2019 Judgment of: KARI J Date of judgment: 14 September 2023 Catchwords: FAMILY LAW – COSTS – Where the mother seeks an indemnity costs order – Where the court considers a costs order should be made – Where consideration is given to whether an order for indemnity costs should be made - Costs order made, fixed in the amount of $25,000 Legislation: Family Law Act 1975 (Cth) (‘the Act’) s 117,
Federal Circuit and Family Court of Australia (Family Law) Rules (‘the Rules’) rr 12.06, 12.17,
Federal Circuit and Family Court of Australia, Central Practice Direction – Family Law Case Management, 28 November 2022.
Cases cited: Ackland & Grohl [2022] FedCFamC1A 137
Colgate-Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Kohan & Kohan [1992] FamCA 116
Lenova & Lenova (Costs) [2011] FamCAFC 141
Meadis & Meadis and Ors [2019] FamCAFC 146
Medlon & Medlon (No 6) (Indemnity Costs) (2015) FLC 93-664
Munday & Bowman (1997) 22 Fam LR 321
Nada & Nettle (Costs) (2014) FLC 93-612
Ragata Developments Pty Ltd v Westpac Banking Corporation (1993) 217 ALR 175
Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622
Higginbotham & Robinson (1991) FLC 92-209
Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (Unreported, Federal Court of Australia, French J, 3 May 1991)
Division: Division 1 First Instance Number of paragraphs: 75 Date of hearing: 23 August 2023 Place: Heard in Sydney, delivered in Adelaide Counsel for the Applicant: Ms Reid Solicitor for the Applicant: Pearson Emerson Family Lawyers Counsel for the Respondent: Mr Sansom SC Solicitor for the Respondent: ATW Family Law ORDERS
SYC 7372 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS DIXON
Applicant
AND: MR YOUNG
Respondent
ORDER MADE BY:
KARI J
DATE OF ORDER:
14 SEPTEMBER 2023
THE COURT ORDERS:
1.That within 28 days the Respondent Father shall pay the Applicant Mother’s costs fixed in the amount of $25,000.
2.That the Amended Application in a Proceeding filed 4 August 2023 and the Response filed 22 August 2023 be otherwise dismissed.
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 Dixon & Young has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
KARI J:
INTRODUCTION
These reasons relate to a costs application bought by the mother in relation to parenting proceedings concerning the parties’ three children.
The application was originally filed on 2 March 2023 and was amended on 4 August 2023. The application for costs relates to an Application in a Proceeding filed by the father on 6 December 2022, which proceeded to full hearing on 9 February 2023. During the course of the hearing the father withdrew his application, his legal representatives withdrew and the parenting proceedings resolved on a final basis by agreement between the parties.
By her application, the mother invites the court to make an order that the father pay her costs on an indemnity basis. In the alternative the mother’s claim for costs is made on a party/party basis as assessed or agreed. During the hearing, the mother’s counsel asked the court to fix costs in the event that the court declined to make an order for indemnity costs.
For the reasons that follow, an order for costs in a fixed amount shall be made.
BACKGROUND
The parenting proceedings were commenced by the father on 9 December 2020 with the filing of his Initiating Application.
The proceedings were in relation to the parties’ three children:
(a)X born 2009;
(b)Y born 2011; and
(c)Z born 2013.
The parties and the short history of their relationship is as follows:
(a)The father was born in 1978 and he is presently 45 years of age.
(b)The mother was born in 1978 and she is also presently 45 years of age.
(c)The parties began cohabiting in 1999, marrying in 2009.
(d)The parties separated on a final basis on 2 August 2017 and were divorced in 2021.
Prior to the parenting proceedings, the parties were able to amicably resolve the question of property settlement some three months after the mother filed an Initiating Application agitating the same. A Final Order was made in that regard on 26 February 2020. The effect of those orders shall be discussed later in these reasons. It is sufficient to understand for present purposes, however, that as a consequences of those orders, the mother retained the former matrimonial home in Suburb F, which is where she and the children have continued to reside.
The parenting proceedings appear to have had a difficult trajectory, largely it would appear from a combination of two significant factors which led to there being significant mistrust between the parties and serious risk concerns agitated on the part of the mother:
(a)Firstly, it is uncontroversial that the father has been troubled by significant substance abuse issues (drugs and alcohol) and concomitant difficulties, which saw him spend periods of time in hospital and various treatment facilities both during the marriage and in the post separation period.
(b)Secondly, there was an “incident” involving the children, the father and the paternal grandfather in mid-2020. That incident led to the paternal grandfather being charged with an offence and an apprehended violence order being made naming the mother and the children as protected persons and the paternal grandfather as the defendant.
The final parenting orders sought by the father in his Initiating Application filed on 9 December 2020 were not ever particularised. Instead the father sought “leave to amend his Final Orders as to the time he spends with the children pending the outcome and recommendations of Family Therapy”.
The final parenting orders sought by the mother in her Response filed on 13 January 2021, in summary, provided for the mother to have sole parental responsibility and that the children live with her. The mother did not otherwise particularise any orders for time spending between the children and the father, seeking leave to amend her application following the release of a single expert report.
At the first substantive hearing in the parenting proceedings on 20 January 2021, detailed parenting orders were made by a Senior Judicial Registrar which significantly for present purposes included:
(a)Various orders made by consent, including:
(i)That the children live with the mother.
(ii)Orders for the preparation of a privately commissioned Family Report by Dr C, with the father to pay $9,000 towards Dr C’s fees.
(iii)An order for family therapy with the mother to pay the costs of her own attendances, the father to pay the costs of his own attendances, together with the costs of the first four of the children’s attendances, with the parties to thereafter equally share the costs of the children’s attendances.
(iv)Monthly drug screen urinalysis of the father at his sole expense for a period of twelve months.
(v)Four occasions of three monthly hair follicle testing of the father at his sole expense.
(b)Orders made as a result of determination, which included:
(i)An order that the children spend supervised time with the father for four hours each Sunday, with such time occurring at a professionally supervised contact facility, with the parties to share in the costs of that service.
(ii)The appointment of an Independent Children’s Lawyer.
Dr C prepared a report dated 4 May 2021.
The parenting proceedings were referred to the trial pool on 28 June 2021. The progression of the matter to a final hearing thereafter resulted in procedural orders made at hearings as follows:
(a)Orders made on 28 June 2022 listing the matter for a first day hearing on 2 November 2022; and
(b)Orders made on 2 November 2022 listing the matter for trial on 21 August 2023.
Running alongside the progression of the matter towards a final hearing, there was an interlocutory argument which was determined by a Senior Judicial Registrar on 18 July 2022. That dispute concerned a subpoena issued by the mother to “B Health Service” directed to the production of documents relating to the father’s new partner Ms D. Each the father and his partner filed a Notice of Objection in relation to that subpoena. The Senior Judicial Registrar resolved those objections by making precise orders about the documents to be produced and the inspection process.
In relation to the charges laid against the paternal grandfather following the incident mid-2020:
(a)The two assault charges related separately to each the child Z and the child Y.
(b)There was a trial in the Local Court in mid-2021 and late 2021 during which the father, the paternal grandfather and the children all gave evidence.
(c)The paternal grandfather was found not guilty in relation to both assault charges in late 2021.
(d)It is the mother’s position that the father has given conflicting evidence in these proceedings to that given in the Local Court proceedings about the incident. In particular the mother asserts that the father gave oral evidence in the Local Court proceedings that it had been the father who had tackled the child Y to the ground and not the paternal grandfather, whereas in these proceedings the father had minimised the incident asserting variously that there was “no physical contact” and that “nothing happened.”[1]
[1] Mother’s affidavit filed 20 January 2023, paragraphs 48 – 49 and 51.
THE CIRCUMSTANCES LEADING TO THE COST APPLICATION
The cost application relates to an Application in a Proceeding filed by the father on 6 December 2022. By that application the father sought a discharge of the supervised time spending orders first made on 20 January 2021 and in their place a suite of unsupervised time spending orders as follows:
3. That for the first 8 weeks after the making of these Orders, the children spend unsupervised time with the father as follows:
3.1Commencing as from the first Sunday following the making of these Orders, from 9.00 am to 6.30 pm each Sunday for a period of four weeks and from after school until after dinner, or 7.30 pm, whichever is the earlier on one afternoon per week with the father to ensure that he facilitates the children’s attendance at any activities the children have that day.
3.2From the next Saturday falling after the four week period in Order 2.1, from 9.00 am Saturday to 6.30 pm Sunday each alternate weekend for a period of four weeks and from after school until after dinner, or 7.30 pm, whichever is the earlier on one afternoon per week with the father to ensure that he facilitates the children’s attendance at any activities the children have that day.
4. At the conclusion of the time in Order [3], the children spend time with the father as follows:
4.1 During School Terms: -
4.1.1 From after school Friday to 6.30 pm Sunday each alternate weekend; and
4.1.2 From after school until after dinner, or 7.30 pm, whichever is earlier, on two agreed days of the week, with the father to ensure that he facilitates the children’s attendance at their activities if they fall that day.
4.2 During School Holidays:
4.2.1 For the first half of the Term 1, 2 and 3 school holidays;
4.2.2Week about during the Term 4 school holidays, with the father to have the first week;
4.2.3 Such further time as may be agreed.
5. To assist in the implementation of these Orders:-
5.1 The father shall collect and deliver the children to school where his time commences on a school day;
5.2During the school holidays, the parent who has the first half of the school holiday period will drop the children to the other parent, unless otherwise agreed;
5.3School holiday periods will be taken to commence at the conclusion of school on the last day of the school term and will conclude at the commencement of school on the first day of the next term.
6. That, without admissions, the father shall ensure that his partner, Ms D, shall not be present during any time the children are spending with the father.
The mother filed a Response to the Application in a Proceeding on 20 January 2023 asking the court to dismiss the father’s application and that he pay her costs on an indemnity basis.
Both of the parties filed lengthy affidavits in support of their competing applications. The mother filed an additional affidavit on 25 January 2023 and the father filed an affidavit from a chaplain Ms E on 3 February 2023.
The interlocutory applications were listed for hearing on 9 February 2023 with the hearing to take place via Microsoft Teams.
In preparation for the hearing, detailed Case Outlines were filed by each of the parties together with Costs Notices, respectively in accordance with paragraph 5.18 of the Federal Circuit and Family Court of Australia - Central Practice Direction – Family Law Case Management and r 12.06 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (‘the Rules’).
The hearing on 9 February 2023 proceeded. The parties were each represented by senior counsel. The hearing commenced at 10.05 am and ran over two tranches of the day as follows:
(a)Between 10.05 am and 12.01 pm during which the father’s senior counsel made fulsome submissions, followed by the commencement of detailed submissions from the mother’s senior counsel. The matter was adjourned until the afternoon to allow the mother’s senior counsel to complete her submissions in circumstances where the hearing had run significantly over time and into other matters that had been listed before me that day.
(b)Between 3.14 pm and 4.04 pm, with a short adjournment between 3.33 pm and 3.51 pm.
It is important to understand that when the second tranche of the hearing resumed at 3.14 pm, it had been intended that the mother’s senior counsel would conclude her submissions. However, when the matter resumed the father’s senior counsel made the following submission:
[FATHER’S COUNSEL]: Yes. Thank you, your Honour. An email was sent not long ago to your Honour’s associate after I spoke to my learned friend, Ms Vohra, and my instructor emailed the ICL and the solicitors for the mother indicating that we received instructions, very firm instructions that our client is taking no further part in the proceedings, and we have a file – my solicitor is to file a notice of ceasing to act, and the purpose of my appearance this afternoon is limited to indicating that to the court as a matter of courtesy.
On hearing that submission, the following exchange ensued:
HER HONOUR: Thank you. All right. Thank you, [Mr Young]. Now, you’ve heard what Mr Sansom has had to say. He tells me that he and your solicitor have been given firm instructions by you that – to use his words – you wish to play no – you wish them to play no further part. Is that correct, and if so - - -
[FATHER]: For him to play no further part, your Honour. I’m sorry.
HER HONOUR: Him to play no further part. All right. Well, we will – I will do it in two tranches.
[FATHER]: Discontinue.
HER HONOUR: Yes. All right. I will do it in two tranches. Firstly, Mr Sansom and his ..... and your solicitor understand that they are to withdraw and cease acting for you. Is that correct?
[FATHER]: Yes, your Honour.
HER HONOUR: All right. And secondly, is the position that you wish to discontinue your application?
[FATHER]: Yes, your Honour.
HER HONOUR: All right. Well, I’m going to do two things. I’m going to excuse Mr Sansom and your solicitor from further participation today, in those circumstances. I’m not yet excusing you because there are some consequences to what you’re telling me, and I’m sure Ms Vohra will make an application for some form of orders, parent – final parenting orders, so that she can, on behalf of her client, the mother, secure the parenting arrangements for the three children. All right. So, I will have those discussions with you directly, and Mr Sansom and your solicitor will be excused. Do you understand that?
[FATHER]: Yes, your Honour.
HER HONOUR: All right. And are you content for Mr Sansom and your solicitor to be excused from further representing you today?
[FATHER]: Yes, your Honour.
HER HONOUR: All right. Thank you, [Mr Young]. Mr Sansom, can I thank you for your assistance today. Your submissions were of great assistance to me, and we are where we’re at.
The hearing then proceeded with the exchange of a draft minute of order prepared on behalf of the mother. Thereafter I took the father through each paragraph of that draft minute of order and save and except as to some variations proposed by each the father and the mother (which were incorporated), a Final Parenting Order was made with the consent of each the father and the mother.
The Final Parenting Order made by agreement between the parties on 9 February 2023 was in the following terms:
1.That all previous parenting Orders be discharged.
2.That the mother have sole parental responsibility for:
2.1 [X] (born 2009) ;
2.2 [Y] born (born 2011) ; and
2.3 [Z] (born 2013).
3.That [X], [Y] and [Z] (“the children”) live with the mother.
4.That the children spend time with the father as agreed between the parties in writing and on conditions as agreed between the parties in writing.
5.That for the children, [X] and [Z], the father be at liberty to attend [X] and [Z’s] sporting matches (excluding trainings) and the school events that parents ordinarily attend, provided that the father, his servants and agents be and are hereby restrained by injunction from approaching [X] or [Z] or the mother or any of them, save with the mother’s prior written agreement, including via text.
6.That the father, his servants and agents be and is hereby restrained by injunction from attending the child, [Y’s] sporting events and school events, save with the mother’s prior written agreement, including via text.
7.That the father do all acts and things and sign all documents necessary, within 7 days of being requested by the mother, to make an application to the Australian Passport Office (or such other department or instrumentality administering the Australian Passports Act 2005 to enable [X] (born […] 2009,) [Y] (born […] 2011) and [Z] (born […] 2013) to be issued with an Australian travel document.
8.That in the event the father refuses or neglects to sign any document necessary to issue [X] (born […] 2009), [Y] (born […] 2011) and [Z] (born […] 2013) or any of them with an Australian travel document, such refusal will constitute sufficient special circumstances for a party to seek that the Minister administering the Australian Passports Act 2005, give considering to issuing an Australian travel document pursuant to section 11(2)(a) of the Australian Passports Act 2005.
The father filed a Notice of Appeal on 8 March 2023 in relation to Orders 5 and 6.
The Appeal was listed on 30 May 2023 but was abandoned, with the following orders made by consent by Austin, Strum and McNabb JJ:
1.That the Amended Notice of Appeal filed 24 April 2023 be dismissed.
2.That within 21 days from the date of these Orders, the Appellant pay the sum of $20,000 to the Respondent Mother in payment of the costs of the Appeal.
On the same day Strum J sat at first instance and made parenting orders by consent between the parties which saw the discharge of the final parenting orders made 9 February 2023 and a fresh suite of parenting orders made. It is not germane to the present costs application to record in detail the final orders that were ultimately made, save and except to note that the orders differed only to the extent of providing for the father to be at liberty to communicate with the children in specific circumstances and defining the extent of such communication.
THE COSTS APPLICATION
As earlier identified, the Amended Application in a Proceeding for costs filed by the mother on 4 August 2023 asks the court to make an order for indemnity costs, or in the alternative an order that the father pay the mother’s costs on party/party basis.
The costs application was listed for hearing on 23 August 2023, however, the hearing was unable to proceed and was adjourned to 29 August 2023. Principal among the reasons that the hearing could not proceed was because each of the parties wished to rely on additional documents contained in a tender bundle which had not made its way to the court. In addition the mother’s counsel was asked to identify which parts of the mother’s affidavit filed 2 March 2023 she sought to rely on, in circumstances where the ambit of the mother’s costs application had been narrowed (she initially had also sought an order for indemnity costs of the whole proceedings).
During the hearing of the costs application on 29 August 2023, counsel for each of the parties indicated to the court that in the event that the court was minded to make an order for costs, but was not minded to make the orders sought by the mother, then the court should fix costs to save the parties the taxation process.
Each of the parties filed a number of documents in relation to the costs application.
The mother filed the following documents:
(a)Application in a Proceeding filed 2 March 2023;
(b)Affidavit of the mother filed 2 March 2023;
(c)Amended Application in a Proceeding filed 4 August 2023;
(d)Notice as to Costs required by r 12.06 of the Rules filed 22 August 2023;
(e)Schedule of Costs filed 22 August 2023;
(f)Case Outline for hearing on 23 August 2023 filed 23 August 2023;
(g)Case Outline for hearing on 29 August 2023 filed 23 August 2023; and
(h)Amended Case Outline for hearing on 29 August 2023 filed 24 August 2023.
The father filed the following documents:
(a)Affidavit of the father filed 20 August 2023;
(b)Response to an Application in a Proceeding filed 22 August 2023;
(c)Notice as to Costs required by r 12.06 of the Rules filed 23 August 2023;
(d)Case Outline filed 28 August 2023; and
(e)Notice as to Costs required by r 12.06 of the Rules filed 29 August 2023.
Pursuant to the mother’s Schedule of Costs filed 22 August 2023 the court understands the claim is made in relation to both the Application in a Proceeding filed 6 December 2022 and the costs application flowing from the same filed 2 March 2023.
The quantum of costs claimed by the mother is as follows:
(a)The costs claim calculated pursuant to Schedule 3 of the Rules, totals $33,543.10 and comprises counsel fees of $13,400.19 and solicitors’ fees of $20,142.91.
(b)The costs claim calculated on an indemnity basis totals $43,773 and comprises counsel fees of $18,788 and solicitors’ fees of $24,985.
THE LEGAL FRAMEWORK
Costs applications in respect of proceedings under the Family Law Act 1975 (Cth) (‘the Act’) are governed by s 117 of the Act.
The factors that are to be considered when contemplating the making of a costs order are those set out in s 117(2A) of the Act; albeit the court may give such weight as it considers appropriate to any relevant factor.[2]
[2] Medlon & Medlon (No 6) (Indemnity Costs) (2015) FLC 93-664 at [24].
The Rules also provide assistance when considering the making of an order for costs. In particular, r 12.17(1) provides the method for the calculation of costs:
12.17 Method of calculation of costs
(1) The court may order that a party is entitled to costs:
(a) of a specific amount; or
(b)as assessed on a particular basis (for example, party and party, solicitor and client or indemnity); or
(c)to be calculated in accordance with the method stated in the order; or
(d)for part of the proceeding, or part of an amount, assessed in accordance with Schedule 3.
In addition, Rule 12.17(3) sets out the matters that may be considered in the calculation of costs:
(3)In making an order under subrule (1), the court may consider the following:
(a) the importance, complexity or difficulty of the issues;
(b)the reasonableness of each party’s behaviour in the proceeding including by having regard to the matters set out in subrule 12.08(2);
(c)the rates ordinarily payable to lawyers in comparable proceedings;
(d)whether a lawyer’s conduct has been improper, unfair, unreasonable or disproportionate;
(e)the time properly spent on the proceeding, or in complying with pre-action procedures;
(f)whether expenses (paid or payable) are fair, reasonable and proportionate.
DISCUSSION
I propose to have regard to only those relevant factors prescribed by s 117(2A).
The parties’ respective financial circumstances
Each of the parties have been selective in the information that they have chosen to put before the court regarding their financial circumstances.
Where the mother is concerned:
(a)The mother deposes to retaining the former matrimonial home in Suburb F and that it has a mortgage. The mother otherwise does not identify the value of that property nor the extent of the borrowings secured against it, other than to say that she has increased those borrowings.
(b)The mother has a 1/7th interest in an apartment in Suburb G, which is subject to a life interest held by the maternal grandfather’s wife. Again, the mother does not identify the value of that asset.
(c)The mother otherwise identified that she has superannuation entitlements of approximately $12,000, she does not own a motor vehicle and she has nominal savings.
(d)The mother deposes to receiving financial support from the maternal grandmother to assist in the payment of her half share of the children’s private school fees (without quantifying the value of such assistance) and that she otherwise receives “quarterly distributions from a family trust which amount to about $140,000 net per annum”[3] which are applied to the mortgage, school fees ad living expenses of the family.
(e)The mother additionally receives $1,572.75 per month from the father pursuant to an assessment of child support. The father additionally contributes to one half of the children’s school fees, X and Z’s phone bill and J Health Insurance premiums.
(f)The mother identifies that she has paid her legal fees with the assistance from family.
[3] Mother’s affidavit filed 2 March 2023, paragraph 147.
Where the father is concerned:
(a)He deposes that “I have no assets in my name. I do not own a car. I have no savings in my name, except for approximately $10,000 that my father has loaned to me to attend to paying child support to [Ms Dixon] and incidental costs until the end of the year.”[4]
(b)He deposes that his taxable income was $50 in the financial year ending 30 June 2022 and $53 in the financial year ended 30 June 2021.
(c)He deposes that he meets his child support obligations from advances from his father both in relation to the assessment made by the child support agency and one half of the children’s private school fees. He asserts that his father has paid his share up to the end of Term 2, 2023 and otherwise has left the mother to liaise with his father about his ongoing preparedness to pay the same.
(d)He deposes that he is presently not in paid employment and that he is volunteering with a NSW Court assistance service and also with the H Organisation. These volunteer roles variously are undertaken on Tuesdays, Wednesday and Thursdays each week.
(e)The father asserts that given the “setbacks” in his life he is unable to maintain “high pressured” employment (which he highlights were positions held when he “was in active addiction”).[5]
(f)Of significance, the father does not identify the extent of the financial support that he receives from his father and whether he has an expectation that the same will continue, nor for how long he expects that to be so.
(g)On any view however, aside from housing, and meeting the father’s child support obligations, one would have to assume from the limited taxable income of the father, that the financial support provided by his father is not insubstantial.
(h)While the father’s father is not obliged to support the father, and according to the father wishes to be unshackled from that responsibility, the reality is that there is no evidence before the court from the paternal grandfather in this regard.
(i)From my perspective the best indicator of the future is what has occurred in the past. Here, where the paternal grandfather has, over an extended period of time in the post separation period, financially supported the father in every sense, it can be safely assumed that this circumstance is likely to continue.
[4] Father’s affidavit filed 20 August 2023, paragraph 115.
[5] Father’s affidavit filed 20 August 2023, paragraph 121.
In addition, it is not lost on me that:
(a)At the hearing of the appeal on 30 May 2023, an order was made by consent that the father pay a sum of $20,000 in costs to the mother;
(b)The fees of Dr C were entirely met by the father, again by consent; and
(c)The father has been represented throughout the litigation (other than as identified earlier in relation to the hearing on 9 February 2023), and his legal fees up to but not including the hearing on 29 August 2023 total $336,929, which have been entirely “advanced/loaned” by his father as follows:
(i)$267,129 in fees paid to date;
(ii)$4,345 billed but not paid;
(iii)$17,600 owed to counsel;
(iv)$41,855 paid in disbursements; and
(v)Work in progress not yet billed $6,000.
(d)In addition the father identifies that he has to date paid the mother’s costs pursuant to orders in the amount of $27,127.56. Again, these amounts have been “advanced/loaned” by his father. It is not clear if this amount includes the amount to be paid pursuant to the orders made in the appeal.
It is long and well understood that the impecuniosity of a litigant is not a bar to the making of an order for costs, see for example; Lenova & Lenova (Costs) [2011] FamCAFC 141 and Nada & Nettle (Costs) (2014) FLC 93-612.
Similarly, I am mindful that the father’s reliance on his father for financial support is equally not a bar to making an order for costs. For example, in Meadis & Meadis and Ors [2019] FamCAFC 146, a costs order was made in circumstances where the father was incarcerated and held no assets other than an amount of $40,000 in a controlled fund. Additionally he asserted that he owed his parents “over $100,000” loaned to him for the payment of his legal costs.
On balance all of these factors do not weigh against the making of an order for costs.
Conduct of the parties in relation to the proceedings
The mother makes strong submissions as to the conduct of the father in relation to his Application in a Proceeding filed on 6 December 2022 as the basis not only for the making of a costs order, but additionally to ground her application that the same be paid on an indemnity basis.
The strongest submission that is made in this regard is that the father waited until the eleventh hour in the course of what had been a lengthy interlocutory hearing to withdraw his interim application and consent to final orders.
This is a submission that has significant merit given the effort expended by the parties to ready the matter for the hearing, which included the filing of documents (as identified earlier), and the instruction of senior counsel, and that the father took his decision to “withdraw”/”discontinue” towards the end of what turned out to be almost 3 hours hearing time.
While the court accepts that the father’s position was not one easily or lightly reached, that does not detract from the reality that the father could have made that decision much, much sooner, given two months had elapsed from the filing of his application; bearing in mind that the mother’s material had been filed on 20 January 2023, which left the father ample time to consider it.
During the hearing of the mother’s costs application the submissions of the mother’s counsel (from which she could not be dissuaded from making), centred upon a premise that the father’s application was doomed to fail and/or had little merit.
The difficulty however with that submission is that, in circumstances where the court was not ultimately called upon to resolve the interlocutory dispute, it is not known whether that submission has any foundation. In proceedings that have been discontinued, the Full Court recently reminded that “a court considering an application for costs in discontinued proceedings should not try a hypothetical action in order to determine whether the matter was likely to have been successful.”[6]
[6] Ackland & Grohl [2022] FedCFamC1A 137 at 8, referencing Re Minister for Immigration and Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622.
What is of more interest, however, is the concession made by the father’s counsel during the hearing that the father gave evidence in the Local Court proceedings that it had been the father who tackled Y to the ground. On any view, that evidence appears to be in stark contrast to the evidence the father gave in these proceedings (as earlier identified by the mother).
In all of the circumstances this conduct of the father in the litigation, together with that discussed later in these reasons weighs in favour of making an order for costs.
Whether any party has been wholly unsuccessful in the proceedings
In Higginbotham & Robinson (1991) FLC 92-209 at 78,417, Nygh J stated that the concept of being wholly unsuccessful is “a situation in which the proceedings as a whole have been unsuccessful. In other words, in which an application which was without merit has been dismissed”.
As identified earlier, I refrain from commenting as to whether the father’s application was without merit.
It is however relevant that the Application in a Proceeding filed by the father on 6 December 2022 was wholly withdrawn. In that sense, the application was therefore wholly unsuccessful.
This factor speaks in favour of making an order for costs.
Conclusion as to whether a costs order should be made
For all of the reasons that I have identified I am satisfied that an order for costs in favour of the mother should be made.
Should an order for indemnity costs be made?
It is well understood that an order for indemnity costs is a “very great departure” from the “normal standard”.[7]
[7] Kohan & Kohan [1992] FamCA 116.
I have had regard to those matters discussed in Colgate-Palmolive Co v Cussons Pty Ltd (1993) 118 ALR 248, particularly at 262.
I have also had regard to the helpful summary of the circumstances that might justify an order for indemnity costs, enunciated by Holden CJ in Munday & Bowman (1997) 22 Fam LR 321 at 322:
(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: see Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397.
(b)Making allegations of fraud, knowing them to be false, and the making of irrelevant allegations of fraud: see Fountain Selected Meats (Sales) Pty Ltd.
(c) Evidence of particular misconduct causing loss of time to the court and to other parties: see Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (French J, Fed C of A, 3 May 1991, unreported).
(d)The making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions: see Ragatta [sic] Developments Pty Ltd v Westpac Banking Corporation (Davies J, Fed C of A, 5 March 1993, unreported).
(e)An imprudent refusal of an offer to compromise.
I have already referred to the conduct of the father earlier in these reasons.
On any view, in light of the conduct of the father to which I have earlier identified it appears that:
(a)The father unnecessarily prolonged this aspect of the proceedings and the hearing on 9 February 2023; and
(b)The father made allegations in this court in his affidavit filed 9 December 2020 which should not have been made given the evidence he gave in the Local Court proceedings.
The mother also points to the father’s conduct in relation to the subpoena for records pertaining to the father’s partner Ms D. In that regard:
(a)It is uncontroversial that:
(i)A subpoena was filed by the mother directed to Ms D’s records from B Health Service;
(ii)The father and Ms D resisted that subpoena, it would appear largely unsuccessfully; and
(iii)The records that were produced, became relevant to the hearing on 9 February 2023, as among other things the records confirmed that Ms D had been an inpatient in B Health Service with a primary diagnosis of “alcohol use disorder” and was in “active detox”.[8]
(b)The mother’s position is that the father acted deceptively (calculatedly so), in failing to disclose to her the reasons for Ms D’s admission, not only in resisting the subpoena, but particularly when regard is had to:
(i)The correspondence passing between solicitors on this topic which gave a different explanation for Ms D’s admission, which were described as “”Changes” which relates to childhood trauma and complex PTSD as a result of parental loss”;[9]
(ii)Allegations made by the father that the mother had been surveying Ms D, which were unfounded as the mother had come to learn of Ms D’s admission from NSW Police;
(iii)The failure of the father and Ms D to disclose her attendance at the clinic to the mother, Dr C and the court.
(c)It is the father’s position that he cannot be held responsible for the records kept by B Health Service, and that he intended to address the discrepancies during cross examination at a final hearing.
[8] Mother’s affidavit filed 2 March 2023, paragraph 79.
[9] Mother’s affidavit filed 2 March 2023, paragraph 69.
While it is difficult to make any findings about the nature of Ms D’s admission, on any view that she was admitted appears to have been withheld from the mother, Dr C and the court. In terms of the application filed on 6 December 2022, the father’s position was that he would ensure that Ms D was not present for his time spending with the children. While a trial ultimately was not heard, issues pertaining to Ms D were canvassed at in some detail at the hearing on 9 February 2023 and contributed in part to the mother’s strident opposition to the father’s application.
Whether this conduct on the part of the father tips the balance in favour of making of an order for indemnity costs, is however a separate question. At first blush the conduct appears particularly egregious and when combined with the conduct earlier discussed, appears to support the making of an order for costs on an indemnity basis.
However in considering this question, I have also had regard to the quantum sought by the mother. While it does not appear that there is a significant difference between the calculation of costs on an indemnity basis as against a party/party basis, I am concerned as to the manner in which the costs application has been pursued.
In particular, the application initially included an application that the father pay the mother’s costs of the whole proceedings. That position was formally abandoned by the mother when she filed her amended application on 4 August 2023. However significantly the mother’s affidavit earlier filed on 2 March 2023 was directed to the dual application. It was not until the hearing on 23 August 2023 when the court asked the mother’s counsel to identify those paragraphs of the mother’s affidavit that were relied upon for the narrowed application for costs that the court and the father had some understanding of the nature of the mother’s more limited case. It is for all of those reasons, that while I consider it appropriate to make an order for costs, I decline to make an order that the same be calculated on an indemnity basis.
Additionally, and for the same reasons I do not consider it appropriate to make an order on a party/party basis.
Taking a broad brush approach, I have determined that it is appropriate to fix the quantum of costs to be paid in the amount of $25,000.
For all of those reasons I make the orders that appear at the commencement of these reasons.
I certify that the preceding seventy-five (75) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Kari. Associate:
Dated: 14 September 2023
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