FIRMER & BRITTON
[2017] FamCA 896
•8 November 2017
FAMILY COURT OF AUSTRALIA
| FIRMER & BRITTON | [2017] FamCA 896 |
| FAMILY LAW – PRACTICE AND PROCEDURE – Where two costs orders were made against the husband – Where the wife served the husband with a costs account nearly two years after the end of the case – Where the wife served the husband with an itemised costs account five years after the end of the case – Where the wife was granted an extension of time by a Registrar –Where the husband made an application to review the Registrar’s decision – Where the explanation for delay was inadequate - Where the Application to review the Registrar’s decision is allowed. |
| Family Law Act 1975 (Cth) Family Law Rules 2004 (Cth) |
| Deputy Commissioner of Taxation v Ganke [1975] 1 NSWLR 252 |
| APPLICANT: | Mr Firmer |
| RESPONDENT: | Ms Britton |
| FILE NUMBER: | TVC | 588 | of | 2007 |
| DATE DELIVERED: | 8 November 2017 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Carew J |
| HEARING DATE: | 16 October 2017 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Foley |
| SOLICITOR FOR THE APPLICANT: | The Brad Robins Legal Centre |
| COUNSEL FOR THE RESPONDENT: | Mr Honchin |
| SOLICITOR FOR THE RESPONDENT: | Stevenson & McNamara Lawyers |
Order
(1)The Application to Review the Registrar’s decision delivered on 15 August 2017 is allowed.
(2)Paragraphs 1, 2 and 3 of the order made on 25 August 2017 (delivered on 15 August 2017) are set aside.
(3)The Application in a Case filed 21 October 2014 is dismissed.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Firmer & Britton has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT BRISBANE |
FILE NUMBER: TVC 588 of 2007
| Mr Firmer |
Applicant
And
| Ms Britton |
Respondent
REASONS FOR JUDGMENT
On 1 September 2017 the applicant (whom I will refer to as “the husband”) filed an Application in a Case in which the following order was sought:
1.The Respondent’s Application in a Case, to dispense with Rule 19.21 of the Family Law Rules, filed 21 October 2014, be dismissed.
The application in fact arises as a result of a decision by a Registrar on 15 August 2017 resulting in an order prepared on 25 August 2017. The hearing before me proceeded on the basis that the husband’s Application was an Application to Review the Registrar’s decision and I will treat it as such.
The order made by the Registrar is in the following terms (as set out in the original):
(1)That compliance by the Applicant with the Rule of the Family Law Rules 2004 is waived.
(2)That the time for the Applicant to serve her Itemised Costs Accounts and the Costs Notice is extended to 5 April, 2014.
(3)That the Applicant serve any Amended Itemised Costs Accounts and also required Costs Notice by 15 September, 2017.
(4)That the Applicant pay the Respondent’s costs of and incidental to this application on a party and party basis as agreed or failing agreement as assessed pursuant to Chapter 19 of the Family Law Rules 2004.
AND IT IS NOTED that Chapter 19 of the Family Law Rules 2004 will apply to determine the costs dispute, if one exists, after the service of the Amended Itemised Costs Accounts in accordance with these orders.
At the conclusion of the hearing I granted Mr Foley, counsel for the husband, leave to make an oral application to stay the operation of paragraphs 1, 2 and 3 of the order dated 25 August 2017. Mr Honchin, counsel for the wife, did not oppose the stay which was granted pending delivery of this judgment.
background
The parties had a brief relationship from 2005 to 2006. They married and were divorced in 2007. There were no children of the marriage.
Financial proceedings between the husband and the respondent (whom I shall refer to as “the wife”) were finalised in this Court after a five day trial in September 2011 before Monteith J sitting in Townsville. The proceedings had been commenced by the wife on 5 August 2008 and were attended by significant delay relating to issues of non-disclosure by the husband.
On 28 August 2009 the wife’s Contravention-Application relating to issues of non-disclosure was heard and succeeded. The matter was adjourned for the parties to consider submissions on an appropriate penalty and an order was made that the husband comply with his obligations to make full and frank disclosure. Ultimately an order was made on 11 October 2010 that the husband pay the wife’s costs of and incidental to the Contravention-Application on an indemnity basis.
In January 2010 the wife retained her current solicitor. The uncontested evidence of the husband is that on 3 May 2010 liquidators were appointed to the wife’s former solicitors, Nelson Lawyers Pty Ltd, and the company was deregistered on 10 November 2011.
In the substantive financial proceedings Monteith J found a net asset pool of $4,068,140 and on 12 October 2011 awarded the wife three percent being a sum of $122,044.
The husband filed a Notice of Appeal against that decision on 27 October 2011.
The wife filed an application for costs in the substantive proceedings on 10 November 2011.
The husband discontinued his appeal on 6 July 2012.
On 20 July 2012 the husband satisfied the judgment together with interest by paying the sum of $129,593.
The wife’s application for costs in the substantive proceedings was determined on 23 July 2012 when Kent J ordered the husband to pay the wife’s costs of and incidental to the proceedings on a party and party basis as agreed and failing agreement to be assessed. His Honour noted that until shortly before the commencement of the trial the husband maintained a position that a sum of $2,100,000, which the husband had transferred to a superannuation fund in the name of his parents, should not form part of the asset pool. His Honour also noted that the wife had made a number of offers, the first of which was made on 11 July 2008 in which the wife offered to settle the matter for $55,000.
Upon the making of that costs order the case was at an end.
On 26 July 2012 the wife’s solicitor retained a costs assessor to draw the indemnity and party/party costs accounts. It was not until 30 August 2013 that draft bills were received by the wife’s solicitor. According to the wife’s solicitor the bills were “not in complete form and further work needed to be carried out” by the wife’s solicitor to complete them. On 20 March 2014 the wife’s solicitor forwarded the completed bills to the costs assessor for “perusal and finalisation”. On 21 March 2014 the costs assessor forwarded correspondence to the wife’s solicitor with amendments to be made to the accounts.
There is no evidence before me that the wife’s solicitor communicated with the husband’s solicitor in any way in relation to the costs orders until 3 April 2014 when they sent a document described as a ‘bills of costs’ in relation to both costs orders to the husband’s solicitor.
On 2 May 2014 the husband served a Notice Disputing Itemised Costs.
The wife’s solicitor deposes to attempts being made to settle the costs dispute but it is clear that any such attempt did not occur until after this date. There are no particulars of when any such attempts were made after this date.
On 30 May 2014 an attempt was made by the wife’s solicitor to file the ‘bills of costs’ in the Townsville Registry of the Court but the local Registrar recused himself and the documents were sent to the Brisbane Registry.
In a letter dated 20 June 2014 but not received by the wife’s solicitor until 16 July 2014 the Registrar informed the wife’s solicitors relevantly: (as appears in the original)
1.In relation to service of the itemised costs account I note:
a. …
b. Pursuant to Rule 19.21 of the … Rules any itemised costs account must be served within 28 days of the end of the case. As it is clear that the end of the case was 23 July, 2012 … the time within which you were required to serve your clients itemised costs account expired on 20
JuneAugust 2012.c. I also that your affidavit indicates that the itemised costs accounts in relation to both orders were delivered “under cover of correspondence dated 3rd April, 2014”. Taking into account Rule 7.17 the date of service is, therefore 5 April, 2014 at the earliest.
d. Therefore the itemised costs account was served almost 2 years out of time.
2.As a result your client will be required to file an Application in a case seeking either an extension of time for service or for compliance with the Rules to be dispensed with prior to any consideration being able to be given to her request for the assessment of the accounts.
3.I further refer you to Rule 19.21 (2) which mandates that, at the time the Itemised Costs Account is served the required Costs Notice must also be served. … Further evidence of compliance will be required.
4.I further refer you to Rule 19.22(2) which requires that the Itemised Costs Account must describe each item in sufficient detail to enable the account to be assessed. It is noted that the itemised costs accounts provided do not define the length of time of any attendance or the length (in folios/words/pages) of any correspondence to which reference is made. As such I do not consider that sufficient detail to enable the account to be assessed has been provided.
Given the process outlined in the Rules for the resolution of the matter … your client may consider amending the itemised costs account to provide this information prior to taking any further steps.
5.I advise that, in the event your client does not amend her itemised costs account she may need to seek orders, in her Application in a Case, for the service of the amended itemised costs account to be able to occur out of time.
6.In addition, given that one of the orders was made on an indemnity basis, evidence of the costs agreement entered into between yourselves and your client is required to be filed in order for any assessment to occur.
I note that several of the issues raised in this correspondence have already been raised by the solicitors for the Husband in their Notice Disputing Itemised Costs Account. Your client should, therefore, give careful consideration to the evidence she provides in support of her Application in a Case when it is submitted.
In the circumstances (where no dispute in relation to which the Court has jurisdiction at this time has been established) all documents are returned to you unfiled.
On 21 October 2014 the wife filed an Application in a Case seeking the following order:
1.That Rule 19.21 of the Family Law Rules be dispensed with.[1]
2.That the Applicant be granted leave to serve the amended party and party bill of costs and amended indemnity bill of costs on the Respondent within 7 days of the date of this Order.
[1] Rule 19.21 has since been amended and the time limitation is now four months after the end of a case
The application was listed for a procedural hearing on 4 December 2014 but ultimately not heard until 2 May 2015 when the Registrar reserved her decision.
On 15 August 2017 the Registrar made a decision granting the extension of time as set out above and an order issued on 25 August 2017. The Registrar apologised to the parties for the inordinate delay in making a decision.
On an unspecified date the wife’s solicitor engaged another firm of solicitors to redraft both bills of costs.
On 12 September 2017 the wife filed and served an Itemised Costs Account and Costs Notice in a form that complied with the Family Law Rules 2004 (Cth) (“the Rules”).
the powers of the registrar
Section 37A of the Family Law Act 1975 (Cth) (“the Act”) authorises the delegation of certain powers to Registrars by the making of Rules. The power exercised by the Registrar in this case is to be found in Rule 1.12 which empowers the Court to dispense with compliance with any Rule whether or not the time for compliance has passed. Rule 1.14 enables a party to apply for a time limitation to be extended even where the time has passed. These Rules are found in Part 1.3 and Part 1.4 of the Rules and are delegated to Registrars by Rules 18.01 and 18.06.
review of power exercised by registrar
Pursuant to s 37A (9) of the Act a party to proceedings in which a Registrar has exercised any of the powers of the court may apply to the court to review the exercise of that power.
Rule 18.08 (1) requires an Application to Review to be filed within seven days after the Registrar makes the order.
Although the power was exercised by the Registrar on 15 August 2017 the order was not prepared in the Registry until the 25 August 2017 and it was then emailed to the parties on 26 August (a Saturday). No prior notice had been provided to the parties that the decision had been made.
The Application to Review was filed on 1 September 2017.
A question arose as to whether or not the husband required an extension of time nunc pro tunc to file the Application to Review. Whether an extension of time is required depends on when the order is ‘made’. Rule 17.01 provides:
An order is made:
(a)In a hearing or trial – when it is pronounced in court by the judicial officer; or
(b)In any other case – when it is signed.
The words in this Rule refer to an order being made when it is pronounced in a hearing. It does not say after a hearing. Accordingly, although there was a hearing before the Registrar on 29 May 2015 no order was pronounced in that hearing. Time therefore runs from the date it was signed but does not include that date (see Rule 1.21(3)). The Application to Review was filed on the seventh day and within the time specified in the Rules. If I am incorrect in that view I would grant an extension of time for the filing of the Application given that it is unlikely to have come to the attention of the parties until 28 August 2017 at the earliest.
procedure on review
Rule 18.10 provides that the Court must hear an Application to Review as an original hearing i.e. the Court rehears the whole matter and does not simply review the original decision.
the husband’s case
In summary, Mr Foley, counsel for the husband, submits that an extension of time should not be granted for following reasons:
a)The bill of costs provided to the husband under cover of the letter dated 3 April 2014 was not an Itemised Costs Account as required by the Rules. Rule 19.22 requires that each item in an Itemised Costs Account be described in sufficient detail to enable the account to be assessed. The deficiency with the account was brought to the wife’s solicitor’s attention by the husband’s solicitor on 2 May 2014 and by the Registrar in the letter to the wife’s solicitors dated 20 June 2014.
b)At the relevant time, Rule 19.21 required that an itemised costs account be served on the person liable to pay the costs within 28 days after the end of the case. An itemised costs account in compliance with the Rules was not served until 17 September 2017, some five years after the end of the case and some seven years after the first costs order.
c)There is no adequate explanation for the delay. The only evidence relevant to that issue is the contention that it took the costs assessor almost two years to produce the first costs account.
d)The explanation for delay such as it is must be balanced against what the Full Court said in Rayburn & Pritchard:[2]
In our view the effect that the grant of leave after such a long delay might have on the administration of justice needed to be considered.
…
Major reliance on the fact that the wife had an order for costs that she would not be able to conclude and enforce, begs the question of the point at which the line is to be drawn with regard to time limits and the wider interests of justice. In one sense, it is difficult to see where the temporal limits of an application to file an itemised costs account out of time would lie, if the decision about an extension of time was to be based entirely on the fact that the wife would lose a substantial benefit. In other words, there must be some point at which the delay is simply too long, without an adequate explanation.
e)It is accepted that in considering an application to extend time the general principles as identified by the High Court in Gallo v Dawson[3] apply.
f)Prejudice would be caused to the husband if leave were granted because he formed the view, not unreasonably in the circumstances, that the wife was not pursuing the costs order. The husband proceeded to get on with his life. He has remarried and had two more children with his new wife and is in the process of adopting the child of his wife from a prior relationship. He has also entered into arrangements with his brother to financially assist his aging parents.
[2] (2014) FLC 93-573 [69], [70]
[3] [1990] HCA 30; (1990) 93 ALR 479
the wife’s case
In summary, Mr Honchin, counsel for the wife submits that the application for review should be dismissed for the following reasons:
a)The wife’s solicitors acted promptly once the proceedings came to an end on 23 July 2012 to have a bill of costs prepared by costs assessors. The first contact with the costs assessors was made on 26 July 2012 and a draft bill of costs was received on 30 August 2013 after numerous communications back and forth;
b)The draft bill required further work;
c)The preparation of the bill was complicated by the duration of the proceedings (over four years) and the fact that the relevant material comprised ten folders. In addition the wife’s previous firm of solicitors no longer existed;
d)In the period between the time the costs assessors were retained and the provision of the draft bill of costs the wife suffered from ovarian cancer;
e)On 20 March 2014 an amended bill of costs was prepared but further amendments were required;
f)As soon as the amendments were made the completed bill of costs was served on the husband under cover of the letter dated 3 April 2014;
g)The husband served a Notice disputing costs on 2 May 2014;
h)Attempts were made thereafter to agree to a sum to no avail;
i)On 30 May 2014 an attempt was made to file the bills of costs in the Townsville Registry but the local Registrar recused himself and the bills were sent to Brisbane for filing;
j)On 16 July 2014 the letter from Registrar Brooks was received wherein the deficiencies with the bills were noted and that an extension of time would be required;
k)Hartwell Lawyers were then engaged to redraw the bills;
l)The Rule requiring service of an itemised costs account within 28 days after the end of a matter only applies to party and party costs and not indemnity costs;
m)The husband refused to comply with his obligations of disclosure which led to the first costs order against him on an indemnity basis. On occasion he failed to attend court events. The husband refused a timely offer to settle the substantive proceedings;
n)The bill of costs totals $150,278, a sum exceeding the sum awarded to the wife in her property settlement;
o)At trial the husband’s property was valued in excess of $4,000,000 and there is no evidence the husband’s financial circumstances have deteriorated.
relevant legal principles
The purpose of any rule enabling a court to extend time is to ensure that the application of the rules themselves do not produce injustice. However, the point of having a time limitation is to ensure that acts required to be undertaken occur in a timely manner. While the court has discretion to extend time, a satisfactory explanation for failing to comply with the time limit is generally a pre-requisite. McHugh J in the High Court decision of Gallo v Dawson[4] described the discretion thus:
The grant of an extension of time under this rule is not automatic. The object of the rule is to ensure that those Rules which fix times for doing acts do not become instruments of injustice. The discretion to extend time is given for the sole purpose of enabling the Court or Justice to do justice between the parties. This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time.
(citations omitted)
[4] (1990) 93 ALR 479
In that case the applicant was refused leave to file an appeal sixteen months out of time in circumstances where her explanation for the delay was considered inadequate and her prospects on appeal were not considered high. Importantly though McHugh J said:
I doubt that I would have considered the applicant's explanation for the delay to be a sufficient reason for enlarging the time for lodging her appeal from the 21 days required by the Rules to the more than 16 months which would be required if this application were to succeed, even if I had thought that the applicant had real prospects of succeeding in her proposed appeal. A case would need to be exceptional before a court would enlarge by many months the time for lodging an appeal simply because the applicant had refrained from appealing until he or she had researched the issues involved.
In the current case, the Rules are silent as to the time by which a costs account is to be served upon a respondent to an order that costs be paid on an indemnity basis.
The Rules are also silent as to the form of the account in such circumstances.
Rule 19.20 provides simply:
A person who has received an account (except an itemised costs account) and wants to dispute the account, or any part of it, must, within 28 days after receiving the account, request the lawyer who sent it to serve an itemised costs account for the whole or part of the account disputed.
However, where a costs order is made for the payment of party and party costs, Rule 19.21 provided at the relevant time:
(1)A person entitled to party and party costs must serve an itemised costs account on the person liable to pay the costs within 28 days after the end of the case.
Note: A person entitled to costs may serve an itemised costs account even if the person liable to pay the costs has not requested it.
(4)For party and party costs, the person entitled to costs must serve a costs notice at the same time as the itemised costs account is served under subrule (1).
Rule 1.14 enables time limitations to be extended and provides as follows:
(1)A party may apply to the court to shorten or extend a time that is fixed under these Rules or by a procedural order.
(2)A party may make an application under subrule (1) for an order extending a time to be made even though the time fixed by the rule or order has passed.
(3)A party who makes an application under subrule (1) for an extension of time may be ordered to pay any other party's costs in relation to the application.
Where no time is specified for the doing of an act, a reasonable time will be inferred and what is reasonable will depend upon the particular circumstances of a case.[5]
[5] Fevia & Carmel-Fevia (2009) 42 Fam LR 50; Deputy Commissioner of Taxation v Ganke [1975] 1 NSWLR 252
discussion
Unfortunately, this case has been attended by significant delay, only part of which falls at the feet of the wife or more accurately perhaps her solicitor. The Registrar’s delay in delivering judgment from 29 May 2015 until 25 August 2017 should not be visited upon the wife. Nor should the delay in listing the application which was filed on 21 October 2014 and not listed for hearing until 29 May 2015.
However, I am particularly concerned about the delay from the end of the case on 23 July 2012 to 3 April 2014 when the first costs account was served on the husband. An account for the indemnity costs order could have been served at any time between the making of the order on 11 October 2010 and the end of the case but as the proceedings continued until 23 July 2012 I do not consider it unreasonable for an account not to have been served in that time. Nevertheless, it is relevant that the wife had from the time of the making the indemnity costs order until the end of the case to have an account prepared. There was no requirement for that account to be an itemised costs account until a dispute was notified.
The explanation for delay is limited to the following evidence:
(a)The wife’s solicitor’s affidavit filed 21 October 2014
·Between the time of engagement [26 July 2012] and 30 August 2013, numerous emails passed between Ms K [the costs assessor] and I in respect to the preparation of the bills of costs.
·On 30 August 2013, I received a draft of the bills of costs as prepared by Ms K. The draft bills of costs were not in complete form and further work needed to be carried out by my office to complete them.
·On 20 March 2014, an email was forwarded to Ms K attaching the completed bills of costs for her perusal and finalisation.
·On 21 March 2014, Ms K forwarded correspondence to my office with amendments to be made to the bills of costs.
(b)The wife’s solicitor’s affidavit filed 27 May 2015
·Between the time of engagement and 30 August 2013, numerous emails passed between Ms K and I in respect to the preparation of the bills of costs. Ms K had a number of queries regarding Nelson Lawyers’ file and I had cause to contact them regarding the matter and to leave messages and wait for their response prior to communicating this with Ms K.
·I was aware that the Applicant Wife was suffering from ovarian cancer and stress exacerbated her problems. I kept her updated in that regard but limited communication so as to not stress her regarding the matter. There was some discussion about obtaining another costs assessor but there was concern that this would cause further delay.
·On 30 August 2013, I received a draft of the bills of costs as prepared by Ms K. The draft bills of costs were not in complete form and further work needed to be carried out by our office to complete them in that Ms K requested that the folios be counted for each and every document. The file is extremely voluminous and comprises more than 10 large volumes.
·… the solicitors for the Respondent Husband and the solicitors for the Applicant Wife have made attempts to settle the costs dispute, however, the parties have been unable to reach a settlement.
The evidence explaining the delay is far from adequate.
The evidence provides no particulars at all of what is meant by “numerous emails” between the time of engagement of the costs assessor on 26 July 2012 and the receipt of the first draft of the account on 30 August 2013. I do not know for instance how many emails were exchanged or the nature of any enquiries contained in the emails. There is no explanation at all as to why it then took from 30 August 2013 to 20 March 2014 for the wife’s solicitors to complete the “further work” or what that further work entailed. There are no particulars of the attempts made to contact the former directors of the wife’s former solicitors, Nelson Lawyers (who had apparently moved to Brisbane), or what information they provided. There is no explanation of how the wife’s cancer impacted on the ability of the wife’s solicitor to prepare the accounts. Although the file is described as “extremely voluminous” comprising “more than 10 large volumes” it is not explained how the size of the file explains such a significant delay.
It seems extraordinary that the wife’s solicitors did not at least communicate to the husband’s solicitors the wife’s intention to pursue her award of costs or explain the delay prior to delivering a costs account 3 April 2014.
The inadequacy of the explanation for delay becomes even starker when one considers that the first costs account provided to the husband on 3 April 2014 did not even include the length of time of any attendance or the length in folios/words/pages of any correspondence to which reference is made in the account.
I am additionally concerned about the delay in delivery of an itemised costs account that complied with Rule 19.22. Despite receiving advice from the Registrar on 16 July 2014 that the account served on the husband was deficient in so many respects, an itemised costs account was not served upon the husband until 12 September 2017. No explanation for that delay is provided at all.
Although reference is made to negotiations there are no particulars of when such negotiations occurred or what impact they had on the delay in preparation of the accounts.
In Esther Investments Pty ltd v Markalinga Pty Ltd[6] Malcolm CJ in the Western Australian Supreme Court refused an application to extend time for the taxation of costs brought nearly three years and four months out of time in circumstances where it was accepted that the failure to do so arose as a result of the inadvertence of counsel. His Honour said:
There must come a point where the interests of finality of litigation militate against the exercise of discretion in favour of a party whose solicitors or counsel have failed by inadvertence to make an appropriate application at the appropriate time.
It has been urged upon me by counsel for the defendant that the court should be reluctant to visit upon the litigant the consequences of inadvertence by his solicitors or counsel. So much may be accepted, but there must be in the interests of the administration of justice and finality in litigation some limit to the exercise of that discretion which is by way of an indulgence of the Court. If a litigant suffers loss or damage as a result of inadvertence amounting to negligence, he has a remedy.
[6] (1992) 8 WAR 400 at 408
As to the issue of prejudice, it is submitted by Counsel for the wife, that the total costs incurred by the wife in the proceedings are $150,278.17 (said to be a reduction from the original costs account which was for a total sum of $193,000).
There is no doubt that if the wife does not receive an extension of time within which to file her Itemised Costs Notice she will suffer significant prejudice assuming she is required to pay her own legal costs. Her costs exceed the sum awarded at trial.
However, as the Full Court in Rayburn & Pritchard[7] makes clear:
… it is difficult to see where the temporal limits of an application to file an itemised costs account out of time would lie, if the decision about an extension of time was to be based entirely on the fact that the wife would lose a substantial benefit. In other words, there must be some point at which the delay is simply too long, without an adequate explanation.
[7]supra
The husband moved on with his life and made decisions on the expectation that the costs awarded would not be pursued. He was fortified in that view when the wife’s original solicitors went into liquidation in 2011 and he heard absolutely nothing about the costs awarded to the wife until 3 April 2014. The costs orders made provision for the assessment of the wife’s costs only if agreement could not be reached and not a word was heard from her solicitor. Further, the husband was aware that the wife had not paid her former solicitors other than a nominal sum. He assumed that the wife was not required to pay the costs of the contravention proceedings. I accept that it was reasonable, in the unusual circumstances of this case, for the husband to take the view that the indemnity costs order (at the very least) was not being pursued. I do not consider that the husband was under any obligation to make his own enquiries about the wife’s intentions in relation to the costs orders.
conclusion
While there is no time limitation imposed under the Rules for the delivery of an account where an indemnity costs order is made I do not consider it reasonable that it took from 23 July 2012 to 3 April 2014 to deliver an account. By 2 May 2014 the wife was aware that the account was disputed and yet it took until 12 September 2017 to deliver an itemised costs account.
Pursuant to Rule 19.21 (as it provided at the relevant time) the wife was required to deliver an itemised costs account in relation to the party and party costs order by 20 August 2012. An itemised costs account as required by Rule 19.22 was not delivered until 12 September 2017 although an account was delivered on 3 April 2014. As noted above the account delivered at that time was seriously deficient and the wife was aware that it was deficient from at least 16 July 2014.
In this case the wife has failed to provide an adequate explanation for the delay.
I do not know what the wife’s financial circumstances are at present but I am prepared to infer that she has few assets and is of modest means. I do not know what the husband’s financial circumstances are at present but he was a man of some wealth at the time of the property trial in 2011 and I am prepared to infer that he remains so or that he is at least in a superior financial position than the wife.
The wife’s costs exceed her award in the property proceedings. There is likely to be prejudice to the wife in refusing leave but granting leave would cause prejudice to the husband who moved on with his life and made decisions affecting his financial circumstances on the basis that the costs orders were not being pursued.
A grant of leave is an indulgence sought from the Court and public confidence in the administration of justice is a significant factor to consider as is the need for finality in litigation. I come to the conclusion that the wife should not be granted leave to deliver the itemised costs account out of time nunc pro tunc and I will allow the husband’s Application for Review of the Registrar’s decision.
I certify that the preceding sixty-four (64) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Carew delivered on 8 November 2017.
Associate:
Date: 8 November 2017.
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