Forster and Forster (Costs)
[2013] FamCAFC 125
FAMILY COURT OF AUSTRALIA
| FORSTER & FORSTER (COSTS) | [2013] FamCAFC 125 |
| FAMILY LAW – APPEAL – COSTS – where the wife makes oral applications for costs – where the husband opposes the applications – where the wife seeks costs in the total sum of $28,923.17 – where there are difficulties with the amount sought namely, it is calculated on the Supreme Court scale, there are costs sought in relation to work done on another appeal which is not entirely relevant or appropriate, there is an error in one of the counsel fees sought, and generally there are claims for costs that cannot be maintained in the circumstances of the proceedings – where the wife’s counsel seeks that the amount of costs be fixed by the court rather than sending the matter to taxation – where there are circumstances which justify a costs order being made – where the husband has been wholly unsuccessful in the proceedings – where the conduct of the husband in relation to the proceedings also justifies an order for costs – costs fixed in the amount of $13,000 to be paid by the husband within three months. |
| Family Law Act 1975 (Cth) – s 117 |
| APPLICANT: | Ms Forster |
| RESPONDENT: | Mr Forster |
| FILE NUMBER: | ADC | 3359 | of | 2007 |
| APPEAL NUMBERS: | SOA | 44 & 46 | of | 2010 |
| SOA | 60 | of | 2012 |
| DATE DELIVERED: | 23 August 2013 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Adelaide |
| JUDGMENT OF: | Strickland J |
| HEARING DATE: | 6 June 2013 |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 30 November 2012 |
| LOWER COURT MNC: | [2012] FamCA 1028 |
| LOWER COURT JURISDICTION: | Federal Magistrates Court |
| LOWER COURT JUDGMENT DATES: | 16 March 2009 23 April 2010 |
| LOWER COURT MNC: | NA – consent orders [2010] FMCAfam 395 [2011] FMCAfam 1310 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mrs West |
| SOLICITOR FOR THE RESPONDENT: | Catherine Hicks & Co Lawyers |
| THE RESPONDENT: | In person |
Orders
The husband pay the costs of the wife fixed in the amount of $13,000, such amount to be paid within three months of the date of this order.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Forster & Forster (Costs) has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
| IN THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT ADELAIDE |
Appeal Numbers: SOA 44 & 46 of 2010; SOA 60 of 2012
File Number: ADC 3359 of 2007
| MS FORSTER |
Applicant
And
| MR FORSTER |
Respondent
REASONS FOR JUDGMENT
Introduction
On 31 January 2013 the wife made an oral application for costs in relation to the orders made that day setting aside previous orders made by Federal Magistrate Lindsay (as he then was), and dismissing various applications in an appeal and Notices of Appeal filed by the husband. On 20 March 2013 the wife made an oral application for the costs of and incidental to the husband’s application in a case filed on 14 March 2013 and an application in an appeal filed on 15 March 2013.
Those applications for costs were ultimately heard by me on 6 June 2013. On that day, the husband initially sought an adjournment of the hearing but I dismissed that application, and the hearing proceeded. The husband also sought an order that I be disqualified from hearing the applications, but I also dismissed that application. In relation to the applications for costs the husband opposed the orders sought.
The wife’s counsel filed an outline of submissions on 31 May 2013 and also relied on an affidavit of the wife’s solicitor filed on 22 May 2013. The husband tendered a written submission on the day of the hearing.
The wife sought costs in the total amount of $28,923.17 including counsel fees of $1,375 and solicitor’s fees of $300 for the hearing on 6 June 2013.
However, there were three difficulties with the total amount sought. First, because of a misconception by the wife’s legal advisers the solicitor’s costs were calculated on the Supreme Court scale rather than on the Family Court scale. Secondly, costs were sought in respect of work done in one appeal (SOA 91 of 2012) which was not entirely relevant or appropriate, and thirdly, there was an error in one of the counsel fees sought. The effect of the second and third issues altered the amount sought to approximately $26,000. However, that of course was still an amount in respect of which the solicitor’s fees were calculated on the Supreme Court scale. To overcome that, the wife’s counsel effectively sought that I fix an appropriate overall lump sum amount using my knowledge and experience of the proceedings, rather than sending the matter to taxation. It was suggested I could do that because the affidavit of the wife’s solicitor effectively set out an itemised account identifying the work done.
There was a further adjustment to the amount sought that was conceded by the wife’s counsel during the hearing, and I will return to that later in these reasons, but first I need to provide some background to the applications.
Background
By orders made on 19 December 2008 and 16 March 2009 Federal Magistrate Lindsay appointed the Public Trustee for the State of South Australia as the Litigation Guardian for the husband.
On 16 March 2009 the Federal Magistrate made final parenting orders, and on 23 April 2010 his Honour made final property settlement orders.
On 17 June 2010 the Litigation Guardian filed an application pursuant to s79A of the Family Law Act 1975 (Cth) (“the Act”), and on 1 October 2010 the orders for property settlement were slightly varied.
On 5 July 2010 the husband filed an application in an appeal in effect seeking an extension of time to appeal against all of the above orders.
On 14 July 2010 the husband filed an appeal against orders made by the Federal Magistrate on 22 June 2010 refusing a stay of the orders for property settlement and by way of enforcement of those orders. Further, on 10 August 2011 the husband filed an application in an appeal seeking an extension of time to file a draft appeal index in relation to the Notice of Appeal filed on 14 July 2010.
On 24 September 2010 I extended the time for the husband to appeal against the orders appointing a Litigation Guardian, and adjourned the balance of the application of 5 July 2010, the Notice of Appeal of 14 July 2010 and the application of 10 August 2010 until after the appeal against the orders appointing a Litigation Guardian had been heard and determined.
On 16 December 2011 the Federal Magistrate discharged the orders for the appointment of a Litigation Guardian.
The appeal against the orders appointing the Litigation Guardian was heard by the Full Court on 16 February 2012, and on 23 March 2012 orders were made allowing the appeal and setting aside the orders of 19 December 2008 and
16 March 2009.On 13 August 2012 the husband filed a Notice of Appeal (but which was dated and had been sent to the Appeal Registrar on 3 January 2012 but not accepted for filing) against orders for costs made by the Federal Magistrate on 6 December 2011.
The applications in an appeal and the Notice of Appeal together with the Notice of Appeal filed on 13 August 2012 were listed for hearing on 28 August 2012. The primary issue was whether as a result of the decision of the Full Court the final parenting and property settlement orders were void or voidable, and if the latter, what then needed to be done. The same issue arose in relation to the order for costs made against the husband in favour of the wife on 6 December 2011. I also observe that by this time, the entire proceedings had been transferred by the Federal Magistrate to the Family Court of Australia.
On 19 December 2012 I delivered my reasons for judgment and declared that the relevant orders were voidable. I also dismissed the application for an extension of time to appeal against the final parenting orders. The husband sought that the balance of the applications in an appeal and the Notices of Appeal proceed, and I adjourned the application to extend the time to appeal against the property settlement orders to 15 January 2013.
At the hearing on 15 January 2013, the wife sought an order adjourning the husband’s applications in an appeal, and Notices of Appeal to enable her to file an Initiating Application seeking that the orders for property settlement and the order for costs be set aside, and seeking new orders for property settlement. The husband opposed that application but I determined to allow it, and adjourned the matter to 31 January 2013.
On 31 January 2013 I sat at first instance and made orders in relation to the Initiating Application filed by the wife including setting aside the orders for property settlement and for costs, and referring the application for property settlement to a Registrar. I also sat as a single appeal Judge and dismissed the outstanding applications in an appeal and the Notices of Appeal and adjourned the question of costs.
On 20 March 2012 I heard the husband’s application in a case filed on 14 March 2013 and his application in an appeal filed on 15 March 2013, both seeking stays of the orders made on 31 January 2013 pending determination of a special leave application to the High Court of Australia and an appeal to the Full Court, and that I be disqualified. I dismissed these applications and adjourned the question of costs to 6 June 2013.
Discussion
As with any application for costs in the Family Court of Australia or the Full Court of the Family Court of Australia these applications are governed by s 117 of the Act. Relevantly that section 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.
As can be seen, the basic principle is that each party is to bear their own costs, but the court has a discretion to order costs if there are circumstances that justify it. That question and the amount of any costs to be awarded are to be determined by reference to the factors set out in s 117(2A).
The wife says that the circumstances here that justify an order for costs are that the husband has been wholly unsuccessful, and his conduct in the proceedings.
The husband’s submissions typically lack insight, and he in effect complains about the conduct of the wife and blames her and the court (although it was the Federal Magistrate who made the orders in the first place) for the outcome of these proceedings; he takes no responsibility himself for that result. It is unclear, apart from his request to adjourn the proceedings pending the hearing of his special leave application and his appeal to the Full Court, what his position is, but I proceed on the basis that he says there are no circumstances that justify an order for costs against him, and that it would be unjust to make such an order.
There is no question that the husband was wholly unsuccessful in the applications that he filed on 14 March 2013 and 15 March 2013, and in his oral applications made on 6 June 2013, and that is the circumstance that justifies an order for costs in relation to those proceedings, but the argument in relation to the other aspects of the application for costs is less clear. In the end result though I find that it is the conduct of the husband in relation to those proceedings which justifies an order for costs. That conduct is the husband’s refusal to conclude the matter by seeking that the orders that I found were voidable be set aside, and his insistence in pursuing an appeal. That unreasonable position by the husband became apparent during the hearing on 28 August 2012, and persisted thereafter. As a result, I was obliged to hear argument about it, and deliver reasons for judgment about it, and ultimately the wife was obliged to file her own application seeking to set aside the orders. The husband even opposed that, and that led to further hearings and further argument. All of that entailed the wife incurring unnecessary legal costs.
Thus, to repeat, I have no difficulty in finding that there are circumstances here that justify an order for costs.
In terms of the other factors in s 117(2A), the only potentially relevant matter is the financial circumstances of the parties. I am aware in general terms of those circumstances from the property settlement proceedings, and both parties filed Financial Statements in those proceedings. The wife works part-time and has a small excess of assets over liabilities. The husband is in receipt of a military pension, and he has money in bank accounts overseas, as well as bonds. At the time of the hearing of the applications for costs there was approximately $400,000 held in trust being the proceeds of sale of the former matrimonial home. Those proceeds were being held pending the determination of the property settlement proceedings. In any event, on the basis of this information there is nothing there that would prevent an order for costs being made in these proceedings.
Turning then to the amount of costs that should be awarded. To repeat, the amount sought was approximately $26,000. However, during the hearing the wife’s counsel properly conceded that the wife could not maintain a claim for any costs incurred prior to the delivery of the Full Court judgment on 23 March 2012. With the way that the itemised account was framed, it was difficult though to extract all of the charges for that work; for example, there was a claim for “collating and paginating appeal files” and “perusing about 2,000 pages of husband’s pleadings” from November 2010 to March 2013 - $3,720. It is simply not possible for me to do anything by way of dissecting out those parts of that work which could reasonably be the subject of the application for costs before me, and as a result I will not be allowing any of it.
I note also that there were claims for work done between March 2012 and
28 August 2012 which I do not propose to allow given that costs should only be recoverable for work done on and from 28 August 2012.
Next, with counsel fees, those that arose in 2010 were not pursued, but I will not be allowing the fees itemised in the account dated 20 August 2012. With the account dated 25 January 2013, that includes work done before other judges in related proceedings, and that cannot be the subject of a costs order made in this court.
On a positive note for the wife though, I do consider it reasonable for the costs to include the costs of the wife’s solicitor attending the various hearings on and after 28 August 2012 and instructing counsel.
However, that still leaves me to grapple with the fact that the wrong scale was used to calculate the costs, and that, coupled with the unsatisfactory aspects recorded above, has not done the wife any favours in pursuing these applications for costs.
In all the circumstances I propose to fix the amount of costs to be paid by the husband at $13,000, and I will allow him three months in which to pay that amount.
I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered on
23 August 2013.
Associate:
Date: 23 August 2013
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