Falk & Falk - [2022] FedCFamC1F 28

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Falk & Falk [2022] FedCFamC1F 28

File number(s): SYC 4653 of 2019

Judgment of: HENDERSON J

Date of judgment: 1 February 2022

Catchwords: FAMILY LAW – COSTS – where the husband sought costs on an indemnity basis against the wife – where the husband made multiple attempts to settle an application for interim property distribution – where wife’s conduct was exceptional, bordering on wilful – costs ordered on an indemnity basis

Legislation:
Family Law Act 1975 (Cth) s 117, 117(2), 117(2A)

Family Law Rules 2004 (Cth) r 19.8(1)(a)

Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 12.17(1)(a)

Federal Circuit and Family Court of Australia Act 2021 (Cth)

Cases cited:
Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225

Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397

J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (No 2) [1993] FCA 70

Kohan & Kohan (1993) FLC 92-340

Moorcroft & Moorcroft [2017] FamCAFC 147

Munday v Bowman (1997) FLC 92-784

Penfold v Penfold (1980) 144 CLR 311

Phillips & Hansford (2020) FLC 93-941

Ragatta Developments Pty Ltd v Westpac Banking Corporation (Davies J, Fed C of A, 5 March 1993, unreported).

Rankin & Rankin (No. 3) [2019] FamCAFC 133

Sfakianakis & Sfakianakis (2019) Fam LR 419

Smith & Fields (third party costs) [2013] FamCA 505

Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (French J, Fed C of A, 3 May 1991, unreported)

Worth & Worth (No. 2) (2019) FLC 93-910

Division: Division 1 First Instance

Number of paragraphs: 49

Date of last submission/s: 22 December 2021

Date of hearing: 23 July 2021

Place: Sydney

Counsel for the Applicant: Mr Cummings SC

Solicitor for the Applicant: ATW Family Law

Counsel for the Respondent: Ms Bennett

Solicitor for the Respondent: Dorter Family Lawyers & Mediators
ORDERS

SYC 4653 of 2019

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:
MR FALK

Applicant

AND:
MS FALK

Respondent

ORDER MADE BY:

HENDERSON J

DATE OF ORDER:

1 FEBRUARY 2022

THE COURT ORDERS THAT:
1.That the wife pay the husband’s costs on an indemnity basis in the amount of $42,108 within 90 days of the date of delivery of this judgement

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…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Falk & Falk

Details

AGLC: Falk & Falk [2022] FedCFamC1F 28
Case: [2022] FedCFamC1F 28
Decision Date

CaseChat Overview and Summary

The wife has brought a dispute before the court regarding costs incurred by the husband, who is seeking $42,108 in actual costs, including counsel's fees. The husband has submitted his costs agreement along with a detailed breakdown of the costs charged and incurred in pursuing his claim. He has made three offers to settle the matter prior to the hearing on 23 July 2021. The court is tasked with determining whether the husband is entitled to indemnity costs, which are only awarded in exceptional circumstances.

The primary legal issue before the court is whether the husband's pursuit of his claim was conducted with wilful disregard of known facts or clearly established law, or if there was an imprudent refusal to accept a settlement offer. The court must consider whether the husband should have known that his application had no chance of success and whether he persisted in what should be seen as a hopeless case. The husband's submissions and the law provide the basis for the court's decision on whether indemnity costs are appropriate.

The court, in considering the principles set out in Kohan and Smith & Fields, as well as other relevant cases, finds that the husband's application does not fall within the exceptional circumstances that warrant indemnity costs. The court noted that the husband's offers to settle were wholly accepted, indicating a willingness to resolve the matter amicably. Furthermore, the court found no evidence of wilful disregard of known facts or law, or of an imprudent refusal to compromise. Therefore, the court decided that indemnity costs are not appropriate in this case.

The final orders of the court are that the husband's application for indemnity costs is dismissed. The husband is not entitled to the additional costs he has sought beyond his actual costs, as the court finds no grounds for awarding indemnity costs under the circumstances presented.

Orders

Orders of the court

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Background

Background to the litigation

The wife filed her submissions on 23 November and the husband objects to the Court reading that material. I will read the parties filed material and make a decision based upon their evidence and the law THE FACTS The husband seeks $42,108 which are his actual costs including counsels fees for 19 July 2021 of $15,895 and 23 July 2021 of $6,820. The husband’s submission attached his costs agreement and the costs charged and incurred by him in pursuing his claim The husband made three offers to settle the matter prior to the hearing on 23 July 2021. On 19 July 2021 after the matter was before me and could not be heard and I made some preliminary remarks on the wife’s resistance to the husband’s application that he access his entitlement in the parties’ superannuation fund. On 6 April 2021 where he said he would accept $500,000. On 10 March 2021 where he sought to access his entitlement in the parties’ superannuation fund. The husband was wholly successful in all his written offers of settlement. Indemnity costs are only ordered in exceptional circumstances .The matters of Kohan and Smith & Fields (third party costs) [2013] FamCA 505 dealing with third party costs are all authority for this proposition. The category of cases in which indemnity costs may be awarded are not closed. Costs on this basis have been ordered in matters where an application is pursued with wilful disregard of known facts or clearly established law, where there has been an imprudent refusal of an offer to compromise, as in the decision of Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 (“Colgate-Palmolive”). In relation to pursuing an application with wilful disregard to known facts or clearly established law, the decisions of Phillips, Rankin, and Sfakianakis reiterate that indemnity costs may be awarded where the applicant, properly advised, should have known they had no chance of success and where a party persists in what should, on a proper consideration, be seen to be a hopeless case. This principle was referred to by his Honour French J in J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (No 2) [1993] FCA 70 at [5]. In Worth their Honours quoted from Holden J's decision in Munday v Bowman (1997) FLC 92-784 (“Munday”), where the Court drew the following principles relevant to costs at [9]:(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 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.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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File number(s):	SYC 4653 of 2019
Judgment of:	HENDERSON J
Date of judgment:	1 February 2022
Catchwords:	FAMILY LAW – COSTS – where the husband sought costs on an indemnity basis against the wife – where the husband made multiple attempts to settle an application for interim property distribution – where wife’s conduct was exceptional, bordering on wilful – costs ordered on an indemnity basis
Legislation:	Family Law Act 1975 (Cth) s 117, 117(2), 117(2A) Family Law Rules 2004 (Cth) r 19.8(1)(a) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) r 12.17(1)(a) Federal Circuit and Family Court of Australia Act 2021 (Cth)
Cases cited:	Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397 J-Corp Pty Ltd v Australian Builders Labourers Federated Union of Workers (No 2) [1993] FCA 70 Kohan & Kohan (1993) FLC 92-340 Moorcroft & Moorcroft [2017] FamCAFC 147 Munday v Bowman (1997) FLC 92-784 Penfold v Penfold (1980) 144 CLR 311 Phillips & Hansford (2020) FLC 93-941 Ragatta Developments Pty Ltd v Westpac Banking Corporation (Davies J, Fed C of A, 5 March 1993, unreported). Rankin & Rankin (No. 3) [2019] FamCAFC 133 Sfakianakis & Sfakianakis (2019) Fam LR 419 Smith & Fields (third party costs) [2013] FamCA 505 Tetijo Holdings Pty Ltd v Keeprite Australia Pty Ltd (French J, Fed C of A, 3 May 1991, unreported) Worth & Worth (No. 2) (2019) FLC 93-910
Division:	Division 1 First Instance
Number of paragraphs:	49
Date of last submission/s:	22 December 2021
Date of hearing:	23 July 2021
Place:	Sydney
Counsel for the Applicant:	Mr Cummings SC
Solicitor for the Applicant:	ATW Family Law
Counsel for the Respondent:	Ms Bennett
Solicitor for the Respondent:	Dorter Family Lawyers & Mediators

SYC 4653 of 2019
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:	MR FALK Applicant
AND:	MS FALK Respondent

ORDER MADE BY:	HENDERSON J
DATE OF ORDER:	1 FEBRUARY 2022