F Firm and Ruane and Ors (Costs)

[2014] FamCAFC 240

FAMILY COURT OF AUSTRALIA

F FIRM & RUANE AND ORS (COSTS) [2014] FamCAFC 240

FAMILY LAW – APPEAL – COSTS – Where the second respondent seeks costs against the appellant – Where the appellant says that each party should bear their own costs or in the alternative the second respondent should pay costs in relation to a discrete issue – Where there were real questions of the court’s jurisdiction arising in the appeal –Where there is no basis for an order for costs to be made – Applications dismissed.

Family Law Act 1975 (Cth) – ss 33, 117(1), (2) and (2A)

APPELLANT: F Firm

FIRST RESPONDENT: Mr Ruane

SECOND RESPONDENT: Ms Bachmann-Ruane

FILE NUMBER: SYC 1991 of 2009

APPEAL NUMBER: SOA 48 of 2012

DATE DELIVERED: 15 December 2014

PLACE DELIVERED: Adelaide

PLACE HEARD: In Chambers

JUDGMENT OF: May, Thackray & Strickland JJ

HEARING DATE: 17 October 2013

LOWER COURT JURISDICTION: Family Court of Australia

LOWER COURT JUDGMENT DATE: 22 May 2012

LOWER COURT MNC: [2012] FamCA 369

REPRESENTATION

COUNSEL FOR THE APPELLANT: Mr Williams with
Mr Fary

SOLICITOR FOR THE APPELLANT: Curwoods Lawyers

COUNSEL FOR THE FIRST RESPONDENT: N/A

SOLICITOR FOR THE FIRST RESPONDENT: N/A

COUNSEL FOR THE SECOND RESPONDENT: Mr North SC with
Mr Puckey

SOLICITOR FOR THE SECOND RESPONDENT: Croxford Partners

Orders

1. The applications for costs be dismissed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym
F Firm & Ruane and Ors (Costs) has been approved by the Chief Justice pursuant to
s 121(9)(g) of the Family Law Act 1975 (Cth).

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT MELBOURNE

Appeal Number: SOA 48 of 2012
File Number: SYC 1991 of 2009

F Firm 

Appellant

And

Mr Ruane

First respondent

And

Ms Bachmann-Ruane 

Second respondent

REASONS FOR JUDGMENT

Introduction

1. On 2 October 2014 this court made orders and delivered reasons for judgment in relation to the application for leave to appeal, and if leave was granted, the appeal, filed by F Firm (“the appellant”) on 19 June 2012 against orders made by Murphy J on 22 May 2012. We granted leave to appeal, but dismissed the appeal, and we made orders for the filing of written submissions in support of and in response to any application for costs made by the parties.

2. On 20 October 2014 Ms Bachmann-Ruane (“the second respondent”) filed written submissions seeking that her costs of the appeal be paid by the appellant.

3. On 22 October 2014 the appellant filed written submissions contending that:

   a)each party should bear her or its costs of and incidental to the appeal;

   b)further or in the alternative, the second respondent ought to pay the appellant’s costs of and incidental to the provision of written submissions in relation to the question concerning associated jurisdiction.

4. No submissions in response to either of these written submissions have been filed.

The Relevant Statutory Provisions

1. Section 117 of the Family Law Act 1975 (Cth) (“the Act”) relevantly provides as follows:

   (1)Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.

   (2)If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4), (4A), and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.

   (2A)In considering what order (if any) should be made under subsection (2), the court shall have regard to:

   (a)the financial circumstances of each of the parties to the proceedings;

   (b)whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;

   (c)the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters;

   (d)whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;

   (e)whether any party to the proceedings has been wholly unsuccessful in the proceedings;

   (f)whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and

   (g)such other matters as the court considers relevant.

Discussion

1. The second respondent submits that the circumstance justifying an order for costs being made in her favour is that the appeal was wholly unsuccessful

   
   

   (s 117(2A)(e)).

2. Further, in support of the application it is said that given the primary issue before the court was whether the trial judge had jurisdiction to hear and determine the second respondent’s claim against the appellant, “[t]he costs and delay occasioned by the Appeal were unavoidable for the [second respondent]. There was no means by which she could escape the litigation and still be heard on the issues to be determined.” (paragraph 10 of the written submissions).

3. The second respondent also correctly pointed out that section 117(2A)(a) of the Act requires the court to consider the financial circumstances of the parties to the proceedings. The specific point raised here by the second respondent is that she “must bear her own legal costs, whereas the Appellant, as an Australian Legal Firm is indemnified by an insurer.” (paragraph 6 of the written submissions).

4. There can be no challenge by the appellant to the accuracy of these submissions, but what the appellant says is that each party should bear their own costs (subject to one rider which we will mention shortly) because “the question of the Family Court’s jurisdiction to hear a claim of the type brought against [the appellant] was quite uncertain. The difference between the judgments of the members of the Full Court (and those in Noll v Noll) highlights the extent of this uncertainty.” (paragraph 5 of the written submissions). In other words, “there was a very real question as to whether jurisdiction existed … [and] the Court was required to be satisfied that [the trial judge] had jurisdiction.” (paragraph 7 of the written submissions).

5. These submissions by the appellant are persuasive and in the circumstances we do not propose to make any order for costs in favour of the second respondent. We are also unpersuaded that the fact any costs ordered against the appellant may be covered by its insurer is a matter that should alter this outcome.

6. The rider we mentioned above relates to the appellant’s attempt to support the decision of the trial judge by reference to the associated jurisdiction under s 33 of the Act. True it is that Thackray J and Strickland J were critical of how the second respondent raised the issue, but the appellant did not oppose this court receiving the second respondent’s brief initial submission in anything but a token way. Given the uncertainty surrounding the issue of jurisdiction, it would have been necessary to address this issue if the appeal was otherwise to be allowed and we therefore do not consider there is a basis for costs to be awarded to the appellant for having to deal with the argument.

7. In these circumstances the applications for costs will be dismissed.

I certify that the preceding twelve (12) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (May, Thackray & Strickland JJ) delivered on 15 December 2014.

Associate: 

Date:  15 December 2014