Freer & Freer (No. 2)

[2008] FamCA 383

FAMILY COURT OF AUSTRALIA

FREER & FREER (NO. 2) [2008] FamCA 383

FAMILY LAW – PROCEDURAL – Application by husband seeking an order to make submissions at the final hearing in relation to property – not opposed – application granted.

FAMILY LAW – PROCEDURAL – Application by intervenor seeking an adjournment of six months due to lack of funds – application opposed – significant prejudice to other parties in delaying proceedings – application dismissed.

FAMILY LAW – COSTS – s.117 Family Law Act 1975 – Application by wife and trustee in bankruptcy against intervenor – intervenor wholly unsuccessful – order for costs.

Family Law Act 1975 (Cth) s 117

APPLICANT: Mrs Freer

RESPONDENT: Mr Freer

TRUSTEE IN BANKRUPTCY: Mr Smith

INTERVENOR: Mr Rickards

FILE NUMBER: ADF 1629 of 2005

DATE DELIVERED: 21 February 2008

PLACE DELIVERED: Adelaide

JUDGMENT OF: Strickland J

HEARING DATE: 21 February 2008

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Berman

SOLICITOR FOR THE APPLICANT: Lynch Meyer

COUNSEL FOR THE RESPONDENT: Mr Haines QC

SOLICITOR FOR THE RESPONDENT: Swan Lawyers

COUNSEL FOR THE TRUSTEE IN

BANKRUPTCY:

Mr Gretsas

SOLICITOR FOR THE TRUSTEE IN

BANKRUPTCY:

Gretsas & Associates

COUNSEL FOR THE INTERVENOR: Mr Howe

SOLICITOR FOR THE INTERVENOR: Howe Martin & Associates

Orders

1. That the Application in a Case filed by the intervenor Mr Rickards on 19 February 2008 be dismissed and removed from the active pending cases list.

2. That leave is granted to the husband to make submissions to the Court at the trial of this matter in connection with the property at Adelaide.

3. That the Application in a Case filed by the husband on 20 February 2008 be dismissed and removed from the active pending cases list.

4. That the intervenor Mr Rickards pay to the wife’s solicitors on behalf of the wife and to the Trustee in Bankruptcy in relation to the Application in a Case filed on 19 February 2008 the sum of THREE HUNDRED DOLLARS [$300.00] each by way of costs, such total amount of SIX HUNDRED DOLLARS [$600.00] to be paid within two [2] months.

IT IS NOTED that publication of this judgment under the pseudonym Freer & Freer is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT ADELAIDE

FILE NUMBER: ADF 1629 of 2005

MRS FREER

Applicant

AND

MR FREER

Respondent

AND

MR SMITH

Trustee in Bankruptcy

AND

MR RICKARDS

Intervenor

EX TEMPORE REASONS

1. There are two applications before me today.  The first one is an Application in a Case filed by the husband on 20 February 2008 in which he seeks an order that he have leave to make submissions to the Court in connection with the property in Adelaide.  That indeed was the application that was foreshadowed and was intended to be dealt with this morning.  I am told, though, that there is no opposition to that application by the wife or the trustee in bankruptcy, or the intervenor for that matter.  Thus on that basis I propose to make that order.

2. The second application that is before me is an Application in a Case filed by Mr Rickards, the intervenor, on 19 February 2008 in which he seeks that the trial in this matter be adjourned for a period of not less than six months.  That is an application which is opposed by the wife and by the trustee in bankruptcy.

3. This matter is listed in this month's pool of cases on the basis of "not before Monday, 25 February".  At this stage, it is unclear whether the trial will be reached.  However, as I said earlier, I have to approach this matter on the basis that it is still in the list and it may be called on next week to commence.  Thus I have to give serious and realistic consideration to Mr Rickards’ application. 

4. The basis of the application is, in summary, that Mr Rickards says he does not currently have the funds to meet his anticipated legal costs.  He has instructed Mr Howe as his solicitor and he has requested Mr Howe to brief a barrister, Mr Dart, to appear for him in the trial.

5. Mr Howe put to me initially that Mr Rickards’ involvement in these proceedings is a significant matter, and I accept that.  No-one has cavilled with that in any submission that has been put to me.  He is seeking to maintain a position where he has two mortgages registered on the title to a particular piece of property, which secure his fees.  The wife and the trustee, as I understand it, are looking to set those mortgages aside. 

6. As I say - and I have summarised - Mr Rickards’ financial position is such that he cannot secure his anticipated legal costs.  Mr Howe has clarified that his firm has been paid up to date, and the concern for Mr Rickards is being able to secure the anticipated fees of his barrister Mr Dart.  Although there is no overall estimate of what those fees are, there is a letter from Mr Dart which indicates the basis of his fees.

7. Mr Rickards seeks that the matter be adjourned for six months.  He puts in paragraph 18 of his affidavit that he believes that if the case was adjourned for that period of time he would be able to make the financial arrangements necessary to secure his legal representation at the trial of this matter.  He has set out in his affidavit - and I am not going to go through it all - what his current financial position is and the arrangements that he has made to meet other liabilities that he has.  He refers to the money that he has put aside or earmarked to meet, for example, taxation liabilities which are due in the immediate future, and he tells me about, and refers to, the state of his practice and how he does not anticipate any large influx of fees from any matter that he is handling.

8. Prima facie Mr Rickards’ position appears to be one of difficult financial circumstances in terms of immediately being able to find a substantial amount of money to secure the fees of his proposed legal representatives.  However, this is a matter where the pre-trial conference took place on 9 November 2007, and that was the conference when the listing was provided of not before 25 February 2008.  Prior to that pre‑trial conference, an order had been made in September, for the applications and supporting documents to be served upon Mr Rickards, given the nature of his involvement in this matter.  That was done.  He duly instructed Mr Howe on 6 November 2007, who attended on 9 November 2007 at the pre‑trial conference, and Mr Howe has confirmed that, in effect, what his instructions were from Mr Rickards were to intervene in the proceedings, and that was advised to the registrar who conducted the pre‑trial conference.  It is noted, in fact, on the draft order sheet that Mr Rickards would file an appropriate application seeking leave to intervene.

9. As at 9 November 2007, though, the important fact for me is that Mr Rickards was aware of when this matter would be going to trial.  He of course had to get leave to intervene before he could make any final arrangements for representation at the trial.  He did file his application seeking leave to intervene on 22 November 2007.  That was then heard by me on 9 January 2008, and I gave leave to Mr Rickards to intervene.

10. Mr Rickards knew he was going to be involved in the case and he knew when the case was going to be heard.  It is only now, though, that he makes an application for an adjournment of the hearing on the basis of his financial circumstances.  As I say, those circumstances are deposed to in his affidavit, but importantly there is no suggestion, for example, that his financial circumstances have changed since either 9 November 2007 or 9 January 2008.

11. I have heard submissions from all counsel and I have been referred to the fact that Mr Rickards has a freehold house, which he says is worth $250,000.00.  He says in his affidavit, paragraph 17, that he may be able to arrange to borrow funds against the security of that home, but it would take him some time to arrange to do so.  I take from that that he has not made any arrangements at all to borrow funds against the security of that home.  Mr Howe has explained, though, that that is a fall‑back position for Mr Rickards.  Primarily, he was looking to secure his legal fees out of income.

12. I am afraid that Mr Rickards should not have afforded himself that luxury.  In my view, knowing when the trial was listed and knowing in January that he was a party, he has had ample time to arrange his finances to secure his legal representation.  He has been able to make arrangements to meet his taxation liabilities.  However, to repeat, it seems to me that he has made no effort to meet his anticipated legal fees for the purposes of this trial, although I must concede Mr Howe had put to me on a previous occasion in the not too distant past that his client was struggling to be able to meet the legal fees anticipated for this trial, but it is only now that he makes a formal application.

13. In my view, he should have done something well before now.  He has not, but he can still do something, in my view.  I accept the submission that his affidavit does not indicate that he has exhausted all avenues available to secure his fees, and I am not satisfied that he needs an adjournment, certainly not an adjournment of six months, to secure his legal fees in some way.  He has, of course, as I say, this freehold house on which he says - and I accept - that he can borrow funds.

14. There is nothing in the affidavit to indicate what arrangements his legal representatives might be prepared to agree to in terms of facilitating subsequent payment of Mr Rickards’ fees.  I accept, as Mr Howe has put to me that the usual position is that fees, particularly to secure barrister's fees, are required by the solicitor before the briefing takes place.  Without labouring the point, in my view Mr Rickards has had ample time to do that.  He has had avenues - namely, mortgaging his house, if necessary - to do that.  He has been able to make arrangements to meet his other liabilities.  Thus I am not satisfied that he is not in a position to secure his legal representation now.

15. In saying that I have not even referred to what is highly relevant on an application like this, namely any prejudice to the other parties.  There is significant prejudice in a delay of this matter.  Indeed, I had to address that issue on an application that I dealt with recently in the same matter, and I do not want to repeat what I said on that occasion.

16. I now have before me applications for costs, firstly an application by the wife seeking costs in relation to the application made by the intervenor, and secondly an application for costs in relation to the same application made by the trustee in bankruptcy.

17. In any application for costs, I am obliged to refer to Section 117 of the Family Law Ac 1975, which provides as follows:

    (1)Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AB 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) 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.

    ...

18. This is a matter where Mr Rickards has been unsuccessful in his application and that is certainly one factor that I need to take into account, both in determining whether there is a justification for any order for costs and also as to what amount should be ordered.  Equally, I am obliged to take into account the financial circumstances of the parties.  Nothing has been put to me by Mr Berman in relation to the wife's circumstances, but I take into account that the wife has had to respond to this application and her solicitor has briefed counsel to appear today.  Thus the wife certainly would have to meet the costs of her legal representation.

19. Mr Gretsas, of course, is not in that position, in the sense of being a party whose financial circumstances I need to take into account in this context, but Mr Gretsas is here as counsel and he needed to be here to argue for the dismissal of the application.  Thus there will obviously be costs for his client associated with this application.

20. I am particularly mindful of the financial circumstances of Mr Rickards.  That said, I consider that there are circumstances justifying an order for costs, primarily because of the application being wholly unsuccessful, and I will make an order that the intervenor pay the costs of the wife and of the trustee in bankruptcy.

I certify that the preceding 20 paragraphs are a true copy of the reasons for judgment of the Honourable Justice Strickland delivered 21 February 2008.

Associate