Frederickson and Grierson

[2007] FamCA 127

FAMILY COURT OF AUSTRALIA

FREDERICKSON & GRIERSON [2007] FamCA 127

FAMILY COURT – CHILDREN - Father discontinues Application - Costs claimed by Independent Children’s Lawyer and mother

Family Law Act 1975

Reserved Judgment (Costs)
(In Chambers)

Applicant: Mr Frederickson

Respondent: Ms Grierson

File number: MLF 3318 of 2005

Date delivered: 1 March 2007

Place delivered: Melbourne

Judgment of: Carter J

Hearing date: Application considered
In Chambers

REPRESENTATION

Counsel for the applicant: Ms Melita

Solicitor for the applicant: Kelly & Associates

Counsel for the Respondent: Ms Dellidis

Solicitor for the respondent: Hogg & Reid

Counsel for the Independent Children’s Lawyer : Ms Glaister

Solicitor for the Independent Children’s Lawyer : Forte Family Lawyers

Orders

1. That the mother’s costs of and incidental to the father’s Form 2 Application filed 22 March 2006 be fixed in the sum of $2,335 and the question of the payment of those costs be reserved to the final hearing of the substantive applications.

2. That the costs of the Independent Children’s Lawyer of and incidental to the father’s Form 2 Application filed 22 March 2006 be fixed in the sum of $2,335 and the question of the payment of those costs be reserved to the final hearing of the substantive applications.

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER:   MLF 3318 of 2005

Mr Frederickson

Applicant

and

Ms Grierson

Respondent

and

Independent Children’s Lawyer

REASONS FOR JUDGMENT

(Costs)

1. Mr Frederickson (“the father”) filed a Form 2 Application seeking to review certain orders made by Senior Registrar FitzGibbon on 14 March 2006.  After a number of adjournments the matter came before Mushin J on 18 and 19 September 2006.  On the latter date his Honour adjourned the father’s application to the Judicial Interim Hearing List at 10am on 3 October 2006.  The father’s application was marked “not reached” and all questions of costs were reserved.

2. On Friday, 29 September 2006 the father caused to be filed a Form 10 Notice of Discontinuance, however, the matter remained listed and came before me on the following Tuesday, 3 October 2006.  On that occasion counsel for each of the Independent Children’s Lawyer and Ms Grierson (“the mother”) sought costs on behalf of their respective clients.  Those applications were opposed and this is the determination of the issue relating to costs.

Background

1. The father and the mother did not marry but lived together in a de facto relationship from either 1994 or 1995.  They are in dispute as to when they finally separated and this is not a matter which I can determine at the moment.

2. Two children were born of the relationship.  J is almost 12, having been born in March 1995 and A is six, having been born in November 2000.  J is autistic.

3. The proceedings commenced when the father caused to be filed applications seeking both final and interim orders concerning the two children.  The proceedings came on before me and without notice to the mother and I made orders on 10 November 2005.  Inter alia  I required the mother to present the children to the Child Minding Centre at this Court by 9.30am on 28 November 2005 where the children were to remain pending further order or direction of the Court.  I further ordered the mother to appear, either personally or by legal representative on the same day and made orders for what would happen in default of her doing this.

4. The circumstances giving rise to the father’s application and the orders made were described in the father’s affidavit filed in support and inter alia alleged that the mother had attempted suicide in October 2005, after which time the children remained in the father’s care until 7 November 2005.  According to the father’s evidence it was arranged that he would take J to have a visit with his mother.  A at that stage was in kindergarten, however, when the father attended to collect her she was not there, and, according to the father’s understanding the mother had removed her from kindergarten and had taken both children to some undisclosed location.

5. On 28 November 2005 the mother caused to be filed responses to the father’s applications, together with an affidavit in support.

6. In that affidavit she acknowledged that she had taken an overdose of the father’s sleeping pills and was taken to the Hospital in October 2005.  She gave a very different explanation about the children’s movements subsequent to this time and her version of how the children came to be with her in November 2005 is very different from that given by the father.  The determination of this and many other disputed matters must await a final hearing.  It should also not be thought that I have fully set out the parties’ respective versions of their relationship and the events, both during and after it.  Nor will I attempt to detail each and every occasion when the matter came before the Court.  It is my intention only to provide a relatively brief background in the circumstances of the limited issues which I am asked to determine.

7. On 29 November 2005 Judicial Registrar Ramsden made orders which set out a regime of care of the children by both parents.  They were to spend approximately equal time with each of their parents but that time was to be substantially supervised by certain specified relatives.  Inter alia an Independent Children’s Lawyer was appointed;  a s 91B order was made, a number of injunctions were granted by consent, against both parties;  and, also by consent, both parents were ordered to attend upon a psychiatrist to be nominated by the Independent Children’s Lawyer for the purposes of assessing each of the parties’ mental health and their capacity to care for the children.

8. Following a number of adjournments the matter came before Senior Registrar FitzGibbon on 14 March 2006.  The Senior Registrar had the benefit of a psychiatric assessment of each of the parents which had been prepared by Dr K and a Family Report prepared by Ms I.  Both reports were tendered to the Senior Registrar by agreement and remain on the Court file.

9. It was the father’s case that the orders made in November 2005 should continue, albeit with some modest adjustments.  Both the mother and the Independent Children’s Lawyer were said by the Senior Registrar in his Reasons for Judgment to be essentially in agreement.  They sought that the recommendations of Ms I be implemented, again with some modest changes and differences in the substance of the orders they respectively sought.

10. Senior Registrar FitzGibbon also refers in his Reasons for Judgment to quite extensive subpoenaed material, to parts of which he had been referred by counsel on behalf of their respective clients.

11. In par 12 of his Reasons for Judgment the Senior Registrar referred to a number of pieces of independent evidence which were before him, but which were not in evidence before me.  It was the mother’s case that the father had a long criminal history and was essentially “a con man”.  It emerges from the Reasons for Judgment that the subpoenaed documents confirmed a significant criminal history of the father commencing in 1992;  inconsistencies about his place of birth;  a number of aliases being used by the father;  and diagnoses of the father suffering schizophrenia.

12. The Senior Registrar was satisfied on the basis of Dr K’s report that there was no necessity for a continuation of supervision, and accordingly a discharge of the requirement for this was appropriate.  The Senior Registrar also gave considerable weight to Ms I’s report and accepted her recommendations.  In turn, this meant that he accepted the recommendations of the Independent Children’s Lawyer although certain proposals of the father and the mother were also accepted and incorporated in his orders.

13. The orders made by the Senior Registrar on 14 March 2006 provided (inter alia) for the children to live with the mother and for her to have sole responsibility for making all decisions concerning their day-to-day care, welfare and development.  Orders were also made that the children have “contact” with the father for two out of every three weekends from after school (or 3.30pm) on Friday until before school (or 9am) on Monday.  Orders were also made in respect of school holiday periods which were to be shared between the parents and orders were also made for birthdays, and other special days.

14. As I have already recorded the father sought a review of certain of the orders which the Senior Registrar had made.  His application was filed 22 March 2006 and it was given a return date of 8 May 2006.

15. The application was administratively adjourned by agreement until 5 June 2006.  The matter was again adjourned by consent until 13 July 2006 and orders were made for J to attend a psychiatrist nominated by the Independent Children’s Lawyer for the purposes of an assessment and report as to his level of autism and consequent needs arising out of his condition.  The father was to pay for the costs of that report but was at liberty at the trial to seek reimbursement of half the costs from the mother.  After the report had been prepared, the Independent Children’s Lawyer was to make it available to Ms I so that she could consider whether the assessment affected the contents of her earlier Family Report.

16. It would appear that Dr C was appointed to prepare the assessment of J.  At the request of all parties a further administrative adjournment was granted to 18 September 2006, to enable Dr C to complete that assessment.

17. On 20 July 2006 the father caused to be filed a Form 18 Application alleging that the mother had failed or refused to permit him to speak to the children on the telephone pursuant to one of the orders made on 14 March 2006. That application was dismissed by Bennett J on 10 August 2006 and the father was ordered to pay the mother’s costs of and incidental to the contravention application fixed in the sum of $1,660. Both parents were ordered to attend a post separation parenting program pursuant to s 13C(c) of the Family Law Act 1975(Cth) (“the Act”).

18. The father’s Application for a Review came before Mushin J on 18 September 2006.

19. Ms Dellidis, who appeared on behalf of the mother, told me without objection from any other counsel, that the father had indicated on that day that he was prepared to abandon the Review if he was able to achieve extra time with the children.  The matter was stood over until the following day, 19 September 2006.  Again, without opposition from any other counsel, Ms Dellidis told me that the father indicated that he abandoned his Application to Review and his request to have extra time and made an oral application instead.  This was opposed by the mother and submissions were made on her behalf.  Following this I was told that the father then instructed his legal advisers to proceed with his Application to Review.  By this stage there was insufficient time for the matter to be determined and it was adjourned, as I have already recorded until 3 October 2006.  Costs were reserved on both the 18^th and 19^th September 2006.

Relevant Legal Principles

1. Section 117(1) of the Act provides that, subject to s 117(2), ss 70NFB(1), 117AB, 117AA and 118, each party to proceedings under the Act shall bear his or her own costs.

2. Section 70NFB(1), s 117AA, s 117AB and s 118 are not relevant to the present application.

3. Pursuant to s 117(2) the Court may make such orders as to costs as it considers just if it is of the opinion that there are circumstances to justify doing so.  That is specifically made subject to sub-ss 2A, (4) and (5) of s 117 and the applicable Rules of Court.  In considering what order (if any) should be made, regard is to be had to the matters referred to in s 117(2A).  The weight to be given to a particular consideration is a matter for the discretion of the Court and s 117(2A)(g) makes it clear that the list of considerations is effectively open ended and is not an exhaustive list.

4. In I and I (No. 2) (1995) FLC ¶ 92-625 the Full Court declined to follow the approach adopted by Mushin J in McDonald (1994) FLC ¶ 92-508, making it clear that there is no rule to the effect that special circumstances must be shown to justify a costs order in children’s matters.

5. The Family Law Amendment Act 2003 (Cth) (“the Amendment Act”) introduced new sub-sections (3), (4) and (5) to s 117. Specific reference is made to costs orders in proceedings in which an Independent Children’s Lawyer had been appointed. Those amendments only apply to “proceedings instituted in the Court” after the commencement date which was 14 January 2004, and accordingly those “new” sections apply to the present application.

6. The sub-sections introduced by the Amendment Act are as follows:

   “117(3) [Court may order payment of independent children's lawyer's costs]

   To avoid doubt, in proceedings in which an independent children's lawyer for a child has been appointed, the court may make an order under subsection (2) as to costs or security for costs, whether by way of interlocutory order or otherwise, to the effect that each party to the proceedings bears, in such proportion as the court considers just, the costs of the independent children's lawyer in respect of the proceedings.

   117(4) [When court must not order payment of independent children's lawyer's costs]

   However, in proceedings in which an independent children's lawyer for a child has been appointed, if:

   (a) a party to the proceedings has received legal aid in respect of the proceedings; or 

   (b) the court considers that a party to the proceedings would suffer financial hardship if the party had to bear a proportion of the costs of the independent children's lawyer;  

   the court must not make an order under subsection (2) against that party in relation to the costs of the independent children's lawyer. 

   117(5) [Funding of independent children's lawyer must be disregarded]

   In considering what order (if any) should be made under subsection (2) in proceedings in which an independent children's lawyer has been appointed, the court must disregard the fact that the independent children's lawyer is funded under a legal aid scheme or service established under a Commonwealth, State or Territory law or approved by the Attorney-General.”

The Applications for Costs

1. Ms Glaister appeared on behalf of the Independent Children’s Lawyer and costs totalling $3,065 were sought.  These comprised:

   28.1$440 for the hearing on 18 September 2006;

   28.2$1165 for the hearing on 19 September 2006;

   28.3$730 for the costs of 3 October 2006;  and

   28.4$730 for the Independent Children’s Lawyer’s costs, including preparation for the hearing, preparation of Dr C’s affidavit which was filed 19 September 2006 and preparation of Ms I’s affidavit which was also filed 19 September 2006.

2. Ms Glaister told me, and I accept, that she held the brief prior to the father discontinuing his application.  Ms Dellidis, on behalf of the mother, sought costs in the same quantum as had been sought on behalf of the Independent Children’s Lawyer. 

Discussion

1. Paragraph 10.11(4) of the Family Law Rules provides that if a party discontinues a case, another party may apply for costs within 28 days after the Form 10 is filed.

2. During the course of her submissions Ms Dellidis referred me to the history of this matter, pointing out that the father had initiated every application since late 2005, saying that twelve appearances in court had resulted.  She stressed that he had pursued the application for a review over the past six months notwithstanding the Family Report which had been provided and which was subsequently updated.  It is convenient to note here that Ms I was provided with Dr C’s assessment of J in August 2006, and wrote to the Independent Children’s Lawyer on 18 August 2006 saying that her observations of J were entirely consistent with  those of Dr C’s.  Ms I also wrote that she completely agreed with Dr C’s conclusions and nothing in his assessment led her to believe that the recommendations made in her earlier report dated 2 March 2006 needed to be altered.  That letter was Annexure “2” to Ms I’s affidavit filed 19 September 2006, Annexure “1” being the original Family Report.

3. Ms Dellidis told me that the father had been on notice in respect of costs since 3 May 2006 and tendered a letter bearing that date.  It was received in evidence as Exhibit “M1”.  The letter was sent to the father’s solicitors and relevantly provided:

   “We refer to your client’s Application for Review of Orders made by Senior Registrar FitzGibbon made (sic) 14 March 2006.  We note that application has been set down for hearing on 8 May 2006.

   We will be pleased if you would advise by return facsimile this day if your client is proceeding with that Application for hearing on Monday, 8 May 2006.

   We have been instructed by our client that in the event that your client is unsuccessful in that application, we are to vigorously pursue a claim for costs against him.  We note that we have briefed counsel to appear in relation to that review on Monday and in the event that your client seeks either to withdraw that application or to adjourn the hearing, we require adequate notice to see if counsel is in a position to return the brief.”

4. It is convenient to note here that Ms Melita, who appeared on behalf of the father, tendered copies of letters sent to the mother’s solicitor and the Independent Children’s Lawyer on 29 September 2006.  They were admitted in evidence as Exhibit “F1”.  Both letters had been sent by facsimile at around 12.30pm on 29 September 2006.  They enclose the father’s Notice of Discontinuance and go on to say:

   “As costs in this matter are already reserved we suggest that any costs issues simply remain reserved to the Trial Judge in due course.”

5. Exhibit “M2” was a letter dated 2 October 2006 from the wife’s solicitor to the father’s solicitor and, omitting formal parts, is in the following terms:

   “We refer to our recent telephone conversation and confirm that our client can only agree to orders being made tomorrow by consent as follows:

   1.That the Husband (sic) pay to the Wife (sic) costs in the sum of $3,065.

   2.That orders granted on 18 and 19 September 2006 reserving the question of the Wife’s (sic) costs on those occasions be discharged.

   3.That all other questions regarding costs of the Husband’s (sic) application for review be dismissed.

   In the event that the Husband (sic) does not agree to these orders and this matter proceeds on 3 October 2006 we confirm that we have briefed Helen Dellidis of Counsel who will in addition to the above seek costs of her appearance at court on that day.”

6. In support of her application Ms Dellidis described the mother’s circumstances.  She pointed to the fact that she was the primary carer for the two children.  She was said to be in receipt of government benefits.  I was told that the father was in arrears of child support which, some three weeks prior to the hearing before me stood at about $16,700.  I was also advised that the father had been made aware that the mother, who was legally aided had now reached her “cap” and that counsel was specifically required to bring the application for costs.  It is the case, as Ms Dellidis told me, that the father’s application for “residence” remains outstanding.  Ms Dellidis also highlighted that the costs order made by Bennett J on 10 August 2006 remained unpaid.

7. Ms Dellidis turned to the question of the father’s financial situation, raising a question about the father’s residence, G.  It was common ground that the father and the mother and the children had lived, at least at times, in this property.  In her first affidavit filed 28 November 2005 the mother deposed in par 6 that she believed that the property was and continued to be owned by the father, however, it was registered in an alternate name which he used.  She also deposed to having attended to payment of the mortgage.  In par 50.22 the mother deposed that the father had been residing in this property until 4 November 2005 when he left and took the children to a motel.  She went on to swear that the father had not, thereafter lived at the property although he continued to visit there from time to time.

1. The father responded to this affidavit in his second affidavit which was filed 13 December 2005.  He denied that the mother had ever made any payments for the house saying that all expenses had been paid for by his parents and uncle when he was unable to do so.  He also deposed that he did not own the property.  He denied what the wife had sworn in par 50.22, saying that at all relevant times he had lived at G.  He went on to say that he had lived there for the last ten years and sought to continue to do so.  He deposed that the home was in the name of his sister’s ex fiancé, who lived in the United States of America. 

2. Exhibit “M3” comprised two title searches for the property at G.  The first was dated November 2005 and it discloses that the sole proprietor of the property was Mr S.

3. At p 11 of Ms I’s report reference is made to the second interview she conducted with the father, during which he was asked to clarify some inconsistencies.  Ms I had previously been shown a number of documents by the mother which included a document relating to this property “which the father had said he owned but this document - “some Application for Financing or a Change of Mortgage Conditions” showed Mr S as the owner of the property.  Ms I noted that the mother had stated that this was a name that the father used as an alias.

4. When asked who Mr S was the father is recorded as having told her that he was his sister’s partner, and that they had been a couple since 1993.  According to Ms I’s report the father went on to say “he lives in Australia but has been working in America for the past two years”.  When asked why he had stated previously that he owned the house in G the father is recorded as having said that “it didn’t make any difference” and that his parents paid the mortgage.

5. Ms Dellidis told me, and such is the case, that this matter was raised in the proceedings before the Senior Registrar.

6. I note from Dr K’s report that he saw the father on 9 February 2006, and in connection with his financial state, the father is recorded as having said:

   “I have been at [G] (sic) since 1996, it cost $96,000 and it is now worth $220,000.  We owe $80,000.  I am on Workcover $482.00 a week.”

7. During the proceedings before the Senior Registrar, Mr Robinson of counsel appeared on behalf of the Independent Children’s Lawyer and in the course of his submissions, referred to the questions asked by Ms I at her second interview with the father.  It is convenient to note here that in her Report and in the transcript the family name of the gentleman in question is spelt “[SH]” whereas on the title search it is spelt “[S]”, however, the context of the material makes it quite clear that it was one and the same man.  Mr Robinson told Senior Registrar FitzGibbon that some of the subpoenaed documents included copies of the County Court presentment to which the father had pleaded guilty and further charges 1 and 17 related to offences committed under the name of Mr S.

8. Ms Dellidis pointed out that the property in question was transferred to the paternal grandfather, who became the sole registered proprietor on 20 December 2005.  The title search in question formed part of Exhibit “WM3” and was dated February 2006.

9. Ms Dellidis also submitted that the father had settled a Workcover claim in December 2005, receiving $13,000.

10. In support of her submission that the father should pay the mother’s costs Ms Dellidis relied on s 117(2A)(a), (b), (c) and (f).

11. In her submissions Ms Glaister told me that the Independent Children’s Lawyer agreed with the history which had been outlined by Ms Dellidis and directed my attention to pars 18, 19 and 20 of the Reasons for Judgment of the Senior Registrar.  It was her submission that the father had not been “completely frank” in the way in which he had conducted the case. 

12. Ms Melita, on behalf of the father, submitted that there should be no order as to costs, or alternatively, that costs should be reserved to the trial.  She pointed out that the 12 appearances noted by Ms Dellidis related to the entire proceedings whereas the Application for a Review related only to the 18^th and 19^th December 2006.  She pointed out that the Notice of Discontinuance had been served at approximately 12 noon and tendered the two letters from the father’s solicitors to the solicitors for the mother and the Independent Children’s Lawyer to which I have already referred.

13. Ms Melita addressed me about the father’s financial situation, saying that he did not receive any income, being reliant on borrowings from his family.  She said that he had been on Workcover but this had ceased in April or May 2006 and made mention of proceedings in the County Court.  She told me that the father lived alone at G, and that this was not his property.  She informed me further that the father had been paying the mother $200 per week in cash payments by way of child support for the last three months, from moneys borrowed from his parents.  She turned to the question of the moneys received by the husband from his Workcare claim, saying that the $13,000 had been significantly reduced by legal fees, resulting in a nett figure of about $4,800.  It was the father’s case that his own father advanced moneys for his day-to-day support.

14. Ms Melita brought the quantum of the legal costs and fees claimed into dispute and in particular, the solicitors’ costs of preparation.

15. I was concerned that I had no evidence about the father’s financial circumstances or about the circumstances in which his father allegedly paid for his living expenses.  Accordingly, I made orders that the father and his own father both file and serve a Form 13 Financial Statement, with a further requirement that the paternal grandfather also provide an affidavit detailing all payments made to or on behalf of the father in these proceedings since they were instituted.  Otherwise, I adjourned the further hearing of the costs applications to be dealt with in Chambers following receipt of the affidavit and Financial Statements.  It is convenient to note here that Ms Melita, on behalf of the father, told me that she accepted that the mother’s income was derived from Social Security payments and did not require her to file a Financial Statement.

16. In due course, the documents were received and filed.  The father also filed an affidavit as well as the Financial Statement which had been the subject of my orders.

The Father’s Evidence

1. In his affidavit filed 17 October 2006 the father deposed that there were County Court proceedings in relation to his weekly Workcover payments being terminated because of an alleged failure to comply with a return to Work Plan, and because the insurer did not accept liability for his choice of surgery.  The matter was said to have been resolved by his receipt of 75 per cent of his pre-injury weekly earnings from 28 April 2003 for a period of six months.  The total payment was $13,000 and after deductions for tax and legal fees he received about $5,000.  He deposed that this was not a lump sum settlement for the injuries which he suffered and does not affect his claims against the insurer and his employer.

2. It was the father’s evidence that he sustained serious injury to his neck and lower back in November 2002, as a consequence of which he became reliant on Workcover.  He deposed to having had “numerous” disputes with the insurer and undergoing surgery on 24 March 2006 in respect of this injury.  Because of the surgery and convalescence he had been unable to return to gainful employment and the father deposed that his medical advice was that he needed at least 12 months to allow for complete recovery.  After his Workcare payments were terminated, the father’s evidence was that he had relied on his parents for support and had also received assistance from his sister, and his uncle.  There is said to be an agreement that, upon resolution of his Workcover proceedings or upon gaining employment, the moneys will be repaid.

3. The father went on to say that he has been assessed by the Child Support Agency to have arrears of child support in the sum of $21,637.71.  It is his case that this figure is incorrect and that he has now instructed his lawyers to attempt to rectify this matter on his behalf.  It is his case that the mother refused to do so, despite a number of requests.  Given that the father’s last assessment was based on his pre-injury income of approximately $34,000 in 2002, he has deposed that he is also seeking to review this.

4. The father’s evidence is that he commenced paying chid support directly to the mother from May 2006, having borrowed money from his sister for this purpose.  It was his case that he made the payments in cash to the mother because of unresolved issues with the Child Support Agency, however, he went on to say that the mother has refused to acknowledge that this money was paid to her and has now refused to accept further payments since the issue was raised in Court when the proceedings came before me.  It is the father’s intention however, he says, to continue the payments through his lawyers as long as his family continues to provide him with funds to do so.

5. The father’s evidence is that he was financially crippled as a result of his injury and further that his own father has contributed towards his legal fees through savings and personal loans.  The father confirmed the contents of the affidavit sworn by his own father and confirms the amounts set out by him as being owed to him and the agreement as to repayment.  I will return to this in due course.

6. The father denies that he has any interest in the property at G.  He has deposed that the property is registered in the name of his father and had been purchased by him from Mr S, his sister’s ex fiancé, in November 2005.  The father has read and confirms the contents of his father’s affidavit in this regard.  It is his case that he is being permitted to live at that property by his father while he gets back on his feet, and because his father wants to ensure that the children have a suitable place to stay when they are with him.

7. Finally, the father has noted his view that the mother’s financial position is also relevant and that he requested, through her solicitors, that the mother also provide a Financial Statement.  The mother’s solicitors have declined to do so and the father requested that prior to any decision being made as to costs, the mother should also file and serve a Financial Statement.  I do not propose to make any such order given the concession made by counsel for the father when the matter was before me, namely, that it was accepted that the mother’s income was derived from Social Security payments and that a Financial Statement was not required.

8. In his Financial Statement also filed on 17 October 2006, the father has deposed that he receives no income and has total personal expenditure of $500 per week.  However, he has also set out that his father pays his living expenses of $150 per week and further that his uncle also contributes and estimated amount of $150 per week for “utilities/expenses”.  He has not provided a breakdown of these amounts.  Apart from a payment of $200 per week for J and A pursuant to what he described as an agreement, the father has marked “nil” in respect of each of the items in Part G of the Financial Statement which deals with personal expenditure.  It should also be noted that the father has deposed in this Financial Statement that his sister pays $200 per week on his behalf for child support for the children.  The father claimed to have a current bank balance of $80;  household contents estimated in value at $4,000;  and clothes, CDs and computer estimated value of $1,500.  He also noted modest superannuation. 

9. Liabilities of $23,000 by way of a loan from his own father for the purposes of legal proceedings and legal costs were disclosed, as was a loan from his sister estimated at $5,200 and a further loan from his uncle estimated at $7,200.  In all, the father claimed total liabilities of some $35,400.

The Evidence of The father’s Father (“The Paternal Grandfather”)

1. The paternal grandfather’s affidavit and Financial Statement were both filed on 17 October 2006.  In his affidavit he deposed to having lent his son a total of $15,000 to pay two previous lawyers who acted on the father’s behalf as well as the further sum of $5,000 to pay his current solicitors.  The paternal grandfather has also deposed that he has provided the father with the sum of $150 per week whilst he recovers from the surgery he underwent on 24 March 2006.  The paternal grandfather said his assistance was provided on the understanding that he will be repaid upon resolution of the father’s Workcover claim and that he has funded the assistance through an extension of the mortgage over the G property, by personal loans and credit cards.  According to the paternal grandfather’s affidavit he has informed the father that he will continue to support him weekly until the resolution of the Workcover matter, however, the father will need to apply for Legal Aid for further funding for the proceedings.

2. The paternal grandfather confirms the father’s evidence that the latter has no interest in the property at G.  He has deposed that the property was previously in the name of Mr S, his daughter’s ex fiancé, however, this property was said to have been purchased by the paternal grandfather in November 2005 for the sum of $200,000.  It was the paternal grandfather’s evidence that there is a mortgage in his name, secured on that property and another property to the extent of $248,000.  The father is permitted to reside in the house, however, according to the paternal grandfather, he has no other interest in that property.

3. In his Financial Statement the paternal grandfather has deposed that his daughter, the father’s sister, lives with him and that she has a gross income of $1500 per week.  The sister is said to pay the sum of $100 per week for his benefit, in relation to food, utilities and general living expenses.

4. The paternal grandfather has deposed to gross wages of $925 per week and a total personal expenditure of $943 per week.  Included in that expenditure is the sum of $150 per week for what was described as “weekly loan to son”.  He has also deposed to payment of maintenance or child support for one M of $87 per week, with the amount of the assessment agreement or order noted as being $380.42 per week.  Mortgage payments/rent of $294 per week were disclosed.  Payments in respect of a motor vehicle were also noted.  Personal loan repayments of $60 were disclosed as being paid to X each week.  Credit card payments totalling $63 were also disclosed.

5. It should be noted that the paternal grandfather has not disclosed his residential address other than as being care of the father’s solicitors.  However, in Part I of the Financial Statement which deals with a deponent's property the paternal grandfather has disclosed ownership of the property at G.  Curiously the entry is in respect of Item 35 (“Home”).  The paternal grandfather has estimated the current value of this property in the amount of $248,000.

6. The paternal grandfather has also disclosed a ten per cent interest in a property at B, the value of which he estimates at $30,000.  His daughter was said to be the other registered owner.  The paternal grandfather disclosed having the sum of $40 in a Westpac Bank Account and a debit balance of $334 in a National Australia Bank Account.  He also disclosed other modest assets as well as the sum of $23,000 which he had lent to the father for living expenses and legal fees.

7. The paternal grandfather’s liabilities in respect of Item 46 (“Home Mortgage”) was expressed to be $248,000.  Additionally, he noted a liability of $27,800 representing his ten per cent share of another mortgage.  The paternal grandfather disclosed a liability of $44,615 being a loan from X and credit card liabilities totalling $15,000.  Superannuation estimated at $48,000 was also noted in the Financial Statement.

8. In summary, the paternal grandfather deposed to a total personal expenditure which exceeded his total average weekly income and total liabilities which exceeded the total value of property which he owned (excluding superannuation).

Further Discussion

1. It can be seen that there are some anomalies between the evidence of the father and his own father and some of the matters which were put to me by Ms Melita on behalf of the father.  It will be recalled that I was told that the father lived alone at G.  However, the paternal grandfather’s Financial Statement, if correct, demonstrates that his home, and the home of the father’s sister, is this very same property. 

2. I was also told that the child support payments of $200 per week were made by the father in cash from moneys borrowed from his parents, whereas the father’s evidence is that these payments are made on his behalf by his sister.

3. It must also be recalled that the husband’s evidence in his affidavit filed 13 December 2005 was that the property was owned by his sister’s ex fiancé, whereas his evidence and that of his own father was that this property was purchased by the paternal grandfather in November 2005.  There may be some explanation for this, noting in particular that the transfer was not registered until 20 December 2005. 

4. It must also be recalled that the father described this property in terms of being owned by him to Dr K in the interview of 9 February 2006.  As I have also earlier noted, it emerges from Ms I’s report that the father referred to this property as being owned by his sister’s partner, during the course of the second interview which was conducted on 21 February 2006. 

5. However, it would not be proper to reject the sworn evidence of the father and his own father.  At the same time that evidence has not been tested by cross-examination.  It may be that the various anomalies are capable of explanation.  It may be that they cannot be satisfactorily explained.

6. I have considered relisting the matter for the purposes of having the evidence tested, but to my mind this would involve the parties in unwarranted further legal costs.

7. The father’s financial position takes on added significance because of the issue of financial hardship set out in s 117(4)(b).  It is clear in my view that if I concluded that financial hardship would be suffered by the husband if he had to bear the costs of the Independent Children’s Lawyer, I “must not make an order under sub-section (2)” against him in relation to those costs.

8. I have no evidence of any fund from which the father could meet an order for costs, given the current state of the evidence.  At present, it could perhaps be said that his father and other relatives provide a financial resource to him by reason of payment of his living costs, legal fees and other benefits. 

9. In McAlpin (1993) FLC ¶ 92-411 Strauss J had made an order requiring the wife to pay two-thirds of the husband’s taxed costs of the proceedings on a party and party basis. He had found that the wife had no property against which, or in respect of which, any order for costs might be satisfied but took the view that the wife had access to resources not only from her family but also from the religious sect to which she belonged. The wife appealed against that order (inter alia).

10. The majority (Nicholson CJ and Maxwell J) dismissed the appeal against the order for costs.  Baker J would have allowed that part of the appeal.

11. The majority took the view that s 117(2A)(a), which refers to the “financial circumstances” of a party encompassed a broader concept than assets and income and extended beyond the usual concept of financial resources, at least to encompass the sort of financial support which the wife received in that case.  The majority pointed out that it was clear from the decision of the judge at first instance that he had an expectation that the order for costs might be met by someone other than the wife, if it was to be met at all, however, the order which was actually made did not place any such person under a legal obligation to do so.  The majority however went on to warn that the approach taken by the trial judge was one that should be taken with great caution saying:

    “It is one thing for a family or an organisation to stand behind a party in proceedings under the Family Law Act either by paying their costs or supporting them in the course of the litigation, but it is quite another matter, in most cases, to make orders against an impecunious party in the expectation that such other person or persons will discharge the orders on their behalf.”

1. It follows from the decision in McAlpin that where a party against whom a costs order is sought has the backing of some third person or institution, a costs order might be made even if the person bound by the order has no apparent means of paying it other than the assistance of the relevant third party.  However, this should be a course of action to be undertaken with great caution.  However, it must also be recalled that McAlpin referred to the “financial circumstances of the party under s 117(2A)(a) whereas, in the case of the application by the Independent Children’s Lawyer, I am dealing with the requirement under s 117(4) not to make an order for costs against a party in circumstances where I consider that party would suffer “financial hardship.”

2. I am not however constrained in the same way in respect of the application for costs made on behalf of the mother.  Further “financial circumstances” of a party under s 117(2A)(a) is merely one of the factors to be looked at when determining whether to make an order.

3. Further, the evidence is that the father has an unresolved claim with or against Workcover and proposes to repay the alleged loans when this claim is resolved or, alternatively, when he gains employment.

Conclusion

1. I cannot resolve this matter until the evidence as to the father’s financial circumstances has been tested.  To my mind, the father’s proceedings were ill founded.  He was, of course, entitled to apply to review the Senior Registrar’s decision, however, he was on notice from the wife at least since 3 May 2006 as to the costs’ ramification of proceeding.  Further, it is relevant to note that he continued to proceed with his application notwithstanding the affidavits of Dr C and Ms I, both of which were filed on 19 September 2006. 

2. So far as the wife is concerned, I would have held that these matters resulted in circumstances which justified an order for costs being made, provided I could also take into account and weigh in the balance, the father’s financial circumstances.

3. So far as the Independent Children’s Lawyer is concerned, for reasons already given, I would need to be satisfied that the imposition of an order would not result in financial hardship to the father.

4. In those circumstances, I propose to fix costs on behalf of both the Independent Children’s Lawyer and the mother and reserve the question of payment by the father to the final hearing of the substantive application, at which time the evidence as to the father’s financial circumstances can be tested.

5. I have already referred to the disputed quantum of the costs.  The dispute was essentially directed towards the costs claimed for solicitor’s preparation although queries were also raised as to the costs of counsel claimed for 19 September 2006.

6. It was not explained to me how the costs of the mother’s solicitor for preparation could amount to $730.  I would understand that the Independent Children’s Lawyer incurred costs in the preparation of the affidavits of Dr C and Ms I, however, this expenditure could also be seen to be relevant to the substantive applications awaiting trial.

7. The Independent Children’s Lawyer and the mother are both in receipt of legal aid and their fees are calculated accordingly.  The fees claimed by counsel are less than those prescribed in Schedule 3 to the Family Law Rules and to my mind, could not be said to be excessive by any stroke of the imagination.

8. Accordingly, I propose to fix the costs of both the Independent Children’s Lawyer and the mother in the sum of $2,335, having deducted the fees charged for preparation.  Otherwise, the question of payment of those costs will be reserved.

I certify that the preceding ninety-one (91) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Carter

Associate:     

Date:              1 March 2007

IT IS NOTED that this judgment for all publication and reporting purposes be referred to as FREDERICKSON & GRIERSON