Franklyn & Franklyn (No. 2)
[2021] FamCAFC 160
•24 August 2021
FAMILY COURT OF AUSTRALIA
Franklyn & Franklyn (No. 2) [2021] FamCAFC 160
Appeal from: Franklyn & Franklyn [2021] FCCA 588 Appeal number(s): EAA 37 of 2021 File number(s): DUC 63 of 2018 Judgment of: AUSTIN J Date of judgment: 24 August 2021 Catchwords: FAMILY LAW – APPEAL – Costs – Application for costs of the appeal – Where the appeal was not wholly unsuccessful – Applications dismissed – Where the appeal succeeded on errors of law – Costs certificates granted in relation to the appeal and the re-hearing – Where the Independent Children’s Lawyer sought costs against the mother – Costs ordered in a fixed sum, but payment stayed until determination of the parties’ remitted applications. Legislation: Federal Proceedings (Costs) Act 1981 (Cth) ss 8, 9
Family Law Act 1975 (Cth) Pts VII, VIII, ss 106A, 117(4), 117(2A)
Family Law Rules 2004 (Cth) r 19.04(4)
Cases cited: CDJ v VAJ (No 2) (1998) 159 ALR 138; [1998] HCA 76
Cramer v Davies (1997) 72 ALJR 146; [1998] 1 Leg Rep 20
Re JJT; Ex parte Victoria Legal Aid (1998) 195 CLR 184; [1998] HCA 44
Division: Appeal Division Number of paragraphs: 30 Date of hearing: Heard by way of written submissions Place: In Chambers Counsel for the Appellant: Mr Strik Solicitor for the Appellant: Urban Family Lawyers Counsel for the Respondent: Mr Kenny Solicitor for the Respondent: Matthew Folbigg Lawyers Counsel for the Independent Children's Lawyer: Mr Guterres Solicitor for the Independent Children's Lawyer: Legal Aid NSW Sydney Central Family Law ORDERS
EAA 37 of 2021
DUC 63 of 2018APPEAL DIVISION OF THE FAMILY COURT OF AUSTRALIA
BETWEEN: MS FRANKLYN
Appellant
AND: MR FRANKLYN
Respondent
INDEPENDENT CHILDREN'S LAWYER
ORDER MADE BY:
AUSTIN J
DATE OF ORDER:
24 AUGUST 2021
THE COURT ORDERS THAT:
1.The appellant shall pay the Independent Children’s Lawyer’s costs of the appeal in the sum of $4,656, the payment of which sum is stayed until the parties’ remitted applications for relief under Pt VIII of the Family Law Act 1975 (Cth) are determined by the Federal Circuit Court of Australia.
2.The appellant’s application for costs against the respondent is dismissed.
3.The respondent’s application for costs against the appellant is dismissed.
4.The appellant is granted a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to her in respect of the costs incurred in relation to the appeal.
5.
The respondent is granted a costs certificate pursuant to the provisions of
s 6 of the Federal Proceedings (Costs) Act 1981 (Cth), being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to him in respect of the costs incurred in relation to the appeal.
6.The appellant and the respondent are both granted costs certificates pursuant to the provisions of s 8 of the Federal Proceedings (Costs) Act1981 (Cth), being certificates that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise payments under that Act to the parties in respect of such part, as the Attorney-General considers appropriate, of any costs incurred by them in relation to the new trial granted by the orders made on 9 July 2021.
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 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to 17.02 Family Law Rules 2004 (Cth).
IT IS NOTED that publication of this judgment by this Court under the pseudonym Franklyn & Franklyn (No. 2) has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
AUSTIN J
On 9 July 2021, orders were made to determine the mother’s appeal from orders made under both Pt VII and Pt VIII of the Family Law Act 1975 (Cth) (“the Act”) on 26 March 2021 by a judge of the Federal Circuit Court of Australia.
The part of the appeal brought from the parenting orders made under Pt VII of the Act failed, but the other part of the appeal brought from the property settlement orders made under Pt VIII of the Act succeeded.
At the conclusion of the appeal, the parties and the Independent Children’s Lawyer (“the ICL”) agreed that costs should be reserved for 28 days and an order was made to that effect.
Within that stipulated period, both the ICL and the father filed Applications in an Appeal seeking costs orders against the mother. Procedural orders were made in respect of the applications, on 16 July and 4 August 2021 respectively, to enable the applications’ determination on the papers in chambers.
In written submissions filed on 4 August 2021, the mother said:
As the respondent father was wholly unsuccessful in the property aspects
of the
appeal, on 15 July 2021, we file an application in an appeal for costs
(As per the original, but emphasis added)
The mother did not actually file an Application in an Appeal, but her submissions will be treated as an application. Nor did she file any affidavit evidence to support her rebuttal of the costs applications made by the father and the ICL or in support of her own informal costs application.
The ICL’s costs
By way of an Application in an Appeal filed on 15 July 2021, the ICL sought costs against the mother in the fixed sum of $4,656.
In support of the application, the ICL relied upon her affidavit filed on 15 July 2021 and her written submissions filed on 23 July 2021.
In opposition, the mother did not file any affidavit and relied upon only her submissions filed on 4 August 2021.
The ICL is a solicitor employed by Legal Aid NSW. In advance of the appeal hearing, she filed and served a schedule of her party/party scale costs totalling $4,656. Those costs were incurred in relation to only that aspect of the mother’s appeal which concerned parenting orders, as the ICL had no interest in the parties’ property settlement dispute. The ICL seeks to recoup those costs because that part of the appeal was wholly unsuccessful.
The only submission usefully made by the mother in rebuttal of the ICL’s application was in these terms:
I would ask that ICL costs not be awarded given the [mother’s] impecuniosity.
But there was no evidence of the mother’s asserted impecuniosity. She chose not to file any evidence about her financial circumstances, even though procedural orders were made allowing her to do so. She was the only person empowered to adduce evidence about her financial predicament to meet the current application. It cannot be accepted she is “impecunious” – literally devoid of financial capacity – given the evidence in the appeal. Having only modest financial circumstances, comprising consideration of both income and assets, is not the same thing as impecuniosity. The mother’s implication of suffering financial hardship if ordered to bear a proportion of the ICL’s costs (s 117(4)(b)) falters without foundational evidence.
While the mother may not be able to easily muster $4,656 in payment of the ICL’s costs in the immediate future, she is yet to secure her final share of the parties’ net assets from the remitted property settlement dispute, which she expects will yield her exclusive ownership of property worth several hundred thousand dollars in net value. The ICL was willing to defer receipt of her costs for six months but, instead, payment of the costs should be deferred until the parties finally resolve their property settlement dispute, either by agreement or re-hearing. Any hardship the mother perceives she would experience in paying the ICL’s costs should then be entirely alleviated.
Respondent father’s costs
By way of an Application in an Appeal filed on 2 August 2021, the father claimed for relief in two different forms, being:
(a)costs of $7,765 against the mother in respect of the unsuccessful aspect of the appeal from the parenting orders; and
(b)costs certificates in his favour under ss 8 and 9 of the Federal Proceedings (Costs) Act 1981 (Cth) (“the Costs Act”) in respect of both the successful aspect of the appeal concerning property settlement orders and the subsequent re-hearing of the parties’ applications under Pt VIII of the Act.
Before dealing with the components of the application, it is as well to observe that there was only one appeal, even though it comprised challenges to orders made under two separate parts of the Act. Costs certificates under the Costs Act may only be granted if each party to the appeal bears his or own costs of the appeal. Therefore, if the father’s first application for a costs order against the wife succeeds, his additional application for costs certificates must fail.
In support of his application, the father relied upon his affidavit and the written submissions he filed on 2 August 2021.
The mother filed written submissions on 4 August 2021, but they were plainly not filed in response to the procedural orders made the same day allowing her until 13 August 2021 to file evidence and submissions in rebuttal of the father’s application. The only material placed before the Court by the mother was her written submissions filed on 4 August 2021, from which it is plain she opposed the father’s application.
In compliance with procedural orders made earlier in the appeal, the father filed and served a schedule of his party/party scale legal costs in the appeal, which totalled $15,531.18. His claim for costs in the sum of $7,765 is approximately one-half of that amount, notionally attributed to his successful resistance of the mother’s appeal from the parenting orders.
The father contended his entitlement to one-half of his costs in the appeal rested on: the mother’s complete lack of success in challenging the parenting orders; his sensible concessions made during the appeal hearing in respect of the property orders; the mother’s alleged failure to comply with operable orders upon determination of the appeal; and the lack of evidence about the mother’s current financial circumstances.
The mother’s challenge to the parenting orders was indeed unsuccessful, but she was not wholly unsuccessful in the appeal proceedings (s 117(2A)(e)) because she succeeded with her challenge to the property settlement orders. During the appeal hearing, the father’s counsel did make candid concessions as were warranted (s 117(2A)(c)), but the appeal from the property settlement orders was still resisted by the father from start to finish. He did not concede the part of the appeal from the property settlement orders, let alone well in advance of the appeal hearing. The appellate contest over the property settlement orders occupied less time than that over the parenting orders, but it still occupied time in the determination of the whole appeal.
The father asserted the mother’s failure to comply with operable orders, thereby precluding him from now re-financing a mortgaged loan, which he expects he will have to remedy by invoking s 106A of the Act seeking the registrar’s execution of a Discharge of Mortgage form on the mother’s behalf. That may be so, but the mother’s conduct at large is an irrelevant consideration on the question of costs. The only relevant aspect of the mother’s conduct for present purposes is the manner of her conduct of the appeal proceedings (s 117(2A)(c)).
As for the parties’ financial circumstances, not too much is known aside from the findings made by the primary judge at first instance. The father deposed to his current financial circumstances being much the same, though he has increased debts. The precise net value of the parties’ assets and superannuation interests is not yet clear, but their most valuable assets are encumbered and at least his income is used to service the secured debt. The father has a reasonable income as a self-employed farmer, but it fluctuates and is all but exhausted by meeting his ordinary expenses. According to the evidence in the appeal, the wife is unemployed and reliant upon social security payments to help meet her living expenses. Following remitter of the parties’ property settlement dispute, another judge is still yet to determine the division of their assets, but it is certain the mother will receive a share of them.
The father’s application for costs is dismissed. He enjoyed success in respect of the parenting orders, but the mother enjoyed success in respect of the property settlement orders. Neither conducted the appeal inappropriately. Neither was favoured with a grant of legal aid. The father’s financial circumstances are modest, but the mother’s could be no better.
The father should, however, have costs certificates for the appeal and the re-hearing of the remitted applications for property settlement orders. The part of the appeal from those orders was successful for demonstrated errors of law after a hearing on the merits and the father will bear his own costs of the appeal (Cramer v Davies (1997) 72 ALJR 146).
Appellant mother’s costs
In her written submissions filed on 4 August 2021, the mother informally notified of her application for a costs order against the father in the sum of $9,509.43, which sum represented one-half of her legal costs in the appeal and was therefore claimed in respect of her successful challenge to the property settlement orders.
The mother incorrectly submitted that her schedule of costs in the total sum of $19,018.86 was a “costs notice provided under 19.04(4) of the Family Law Rules”. It was instead the schedule she was obliged to file in advance of the appeal pursuant to orders made by the regional appeal registrar on 25 May 2021. Regardless, unlike the father, the mother failed to demonstrate those costs were calculated on a party/party basis according to the scale costs specified with the Family Law Rules 2004 (Cth).
The only substantive submission made by the mother in support of her application was that the father was “wholly unsuccessful in his appeal insofar as it related to property issues” (emphasis added), but the submission is rejected as being misconceived. The appeal was not the father’s; it was hers. He successfully defended her appeal to the extent that it challenged parenting orders and, while her overall appeal was not wholly unsuccessful, a substantial part of it was.
The mother’s application for costs is dismissed. She enjoyed success in respect of the property settlement orders, but the father enjoyed success in respect of the parenting orders. Neither conducted the appeal inappropriately and nothing can be usefully added to the earlier commentary about the parties’ respective financial circumstances.
In her submissions, the mother also sought costs certificates under the Costs Act for the appeal and re-hearing of the parties’ property settlement dispute. Such certificates are granted for the same reasons they are granted to the father.
Only the mother and father were parties to the appeal and they each bear their own costs, which is a pre-condition to the grant of costs certificates. The ICL was a participant in, but not a party to, the proceedings (Re JJT; Ex parte Victoria Legal Aid (1998) 195 CLR 184 at 207 and 225–226) and her duty carried over to the appeal (CDJ v VAJ (No 2) (1998) 159 ALR 138 at [11]), so the costs order made in favour of the ICL against the mother does not preclude the grant of costs certificates to the parties.
I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Austin. Associate:
Dated: 24 August 2021
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