Genesalio and Genesalio (No 2)
[2020] FamCAFC 180
•28 July 2020
FAMILY COURT OF AUSTRALIA
| GENESALIO & GENESALIO (NO. 2) | [2020] FamCAFC 180 |
| FAMILY LAW – APPEAL – PROPERTY – COSTS – Where both parties seek their costs of and incidental to the hearing of the appeals – Where in relation to the first appeal there are circumstances which would justify an order for costs being made in the respondent’s favour – Where in relation to the second appeal although it was upheld there are no circumstances justifying an order for costs in the appellant’s favour, and if there were, the appellant’s conduct would provide a basis for the respondent to oppose or offset any order for costs made – Where the appeals were consolidated and heard together and thus the issue of costs arising from the outcomes should be considered together – Where it would be a strange result overall if the respondent was able to obtain an order for costs in the first appeal and there was no order for costs in the successful more substantial second appeal – Where there should be no order for costs in favour of either party – Each party to bear their own costs. FAMILY LAW – APPEAL – COSTS CERTIFICATES – Where in the event that no costs order was made both parties applied for costs certificates pursuant to the provisions of the Federal Proceedings (Costs) Act 1981 (Cth) – Where given the first appeal was dismissed costs certificates are not available – Where it is not appropriate for costs certificates to issue – Applications dismissed. |
| Family Law Act 1975 (Cth) s 117 Federal Proceedings (Costs) Act 1981 (Cth) Family Law Rules 2004 (Cth) r 19.08 |
| APPELLANT: | Mr Genesalio by his Case Guardian Mr M Genesalio |
| RESPONDENT: | Ms Genesalio |
| FILE NUMBER: | MLC | 7657 | of | 2018 |
| APPEAL NUMBERS: | SOA | 83 & 88 | of | 2018 |
| DATE DELIVERED: | 28 July 2020 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | Adelaide |
| JUDGMENT OF: | Strickland J |
| HEARING DATE: | Written Submissions |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 22 October 2018 8 November 2018 |
| LOWER COURT MNC: | NA – Transcript only [2018] FCCA 3458 |
REPRESENTATION
| THE APPELLANT: | In person with the assistance of his brother Mr M Genesalio |
| COUNSEL FOR THE RESPONDENT: | Mr Puckey |
| SOLICITOR FOR THE RESPONDENT: | Mazzeo Lawyers |
Orders
Each party bear their own costs.
In appeal no. SOA 88 of 2018 the applications made by both parties for costs certificates to issue pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) be dismissed.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Genesalio & Genesalio has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT ADELAIDE |
Appeal Numbers: SOA 83 and 88 of 2019
File Number: MLC 7657 of 2018
| Mr Genesalio |
Appellant
And
| Ms Genesalio |
Respondent
REASONS FOR JUDGMENT
Introduction
On 14 May 2020, this Court made orders and published reasons for judgment in appeal nos. SOA 83 of 2018 (“the first appeal”) and SOA 88 of 2018 (“the second appeal”). The former appeal was dismissed, and the latter appeal was allowed.
Both appeals were brought by Mr Genesalio (“the husband”), and were subsequently pursued by him through his Case Guardian, his brother, Mr M Genesalio, who was appointed on 24 May 2019.
Both appeals were opposed by Ms Genesalio (“the wife”).
Included in the orders made on 14 May 2020, were orders that provided for any party who sought an order for costs to file and serve written submissions in support, and for written submissions in response, and written submissions in reply if necessary.
On 4 June 2020, the wife filed written submissions seeking the following orders:
16.That the [husband] pay the [wife’s] costs incidental to the entire appeal proceedings, save for the appearance at one directions hearing and one appeal hearing.
17.That further and in the alternative, the [husband] pay one half of the [wife’s] costs of and incidental to the entire appeal proceedings.
18.That such costs be as agreed in writing between the between the (sic) parties within 14 days and failing agreement, to be taxed on scale.
19.That in the event a costs order is not granted against the [husband] in relation to either appeal then Costs Certificates be granted to the [wife] instead.
The total amount of costs sought by the wife for both appeals on a party/party basis is $31,111.39, comprising solicitor’s fees of $15,957.62, and counsel fees of $15,153.77.
On the same date the husband filed written submissions seeking the following orders:
2. The Appellant husband seeks an order for:
i Indemnity costs or
iiin the alternative costs fixed by reference to the scale of fees referrable to the Family Law Rules 2004 (Cth) or
iiifurther in the alternative a cost certificate pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) in the event a costs order is not made against the Respondent wife.
On 9 June 2020, the husband filed an amended submission seeking the following orders:
2. The Appellant husband seeks an order for:
i Indemnity costs in the sum of $14,837.95 or
iiin the alternative costs fixed by reference to the scale of fees referrable to the Family Law Rules 2004 (Cth) or
iiifurther in the alternative a cost certificate pursuant to the Federal Proceedings (Costs) Act 1981 (Cth) in the event a costs order is not made against the Respondent wife.
It is apparent from those written submissions filed by the husband that the costs he sought were only in relation to the second appeal. However, on 19 June 2020, the husband filed a “reply” to the wife’s submissions, and therein sought the following orders, without amending the amount of costs sought in the written submissions filed on 9 June 2020:
24.The Respondent wife’s application for costs in SOA83 and SOA88 of 2018 be dismissed.
25.The Respondent Wife pay the costs of the appellant husband in SOA83 of 2018 and SOA88 of 2018.
The first problem with the orders sought by the husband is that in the schedule of costs annexed to the amended submissions, items 1, 2, 3, 4 and 24 clearly relate only to the second appeal, but with the balance of the items, save and except for item 23, it is entirely unclear as to whether they relate to both appeals. Prima facie, it would seem that they do so relate, but that would be inconsistent with, at that time, the husband only seeking the costs of the second appeal. Further, with items 1-4 the amount claimed is described as being “78%” of the total amount on the basis that in some way that represents the percentage applicable to the second appeal. I note that nowhere is it explained how 78 per cent was arrived at for that purpose.
The second problem with the husband’s schedule of costs, is that he has not provided the accounts from any of the legal practitioners named so that I can determine to what those costs relate, and whether they were in fact charged.
Apart from anything else, the need for those accounts stems from the fact that at all times, in relation to the appeals, the husband appeared without legal representation. Further, there may be items that are not claimable as costs in relation to the appeals. For example, no appeal book was ordered in either appeal, yet item 18 in the schedule is “Print Appeal Book … (Solicitor) $444.60”.
Again, during the course of the hearing of the appeals, and on 26 April 2019, an Application in an Appeal was filed by the husband seeking an order that his brother be appointed as his Case Guardian. That application was heard on 1 May 2019, and the order was made and reasons for judgment published on 24 May 2019. However, apart from item 15 on the schedule of costs, described as “Litigation Guardian … (Solicitor) $729.99”, it is not clear whether any other item relates to this issue, and in any event, it is arguable that none of the costs relating to that are applicable and claimable as costs in the appeal.
The third problem is that the husband is seeking an order for indemnity costs, but he has not complied with r 19.08(3) of the Family Law Rules 2004 (Cth) (“the Rules”), which provides as follows:
A party applying for an order for costs on an indemnity basis must inform the court if the party is bound by a costs agreement in relation to those costs and, if so, the terms of the costs agreement.
That failure is compounded by the absence of the accounts rendered by the various practitioners identified.
Another significant issue with the submissions of the husband is that throughout those submissions, in support of his application for the costs of the appeal(s), the husband refers to and relies on allegations as to the conduct of the wife in the proceedings below. However, it is not open for the husband to seek that that conduct be taken into account to the extent that he suggests, and much of what he says is irrelevant to the question of the costs of the appeal(s).
I will return to these issues where necessary later in these reasons.
In relation to the orders sought by the wife, there are two problems that emerge. The first is that with order 2, this Court is left to assume that that is an order consequent upon the first appeal being dismissed, and seeking one half of the total costs incurred on a party/party basis for that appeal. The difficulty with that is that there would have been far more work involved in the second appeal than the first appeal, and one half of the total costs could not be justified as the costs appropriate to that appeal.
The second problem is that if no costs orders are made, then there can only be a costs certificate where an appeal is allowed, yet a certificate is sought in relation to the appeal that was dismissed.
Discussion
The question of costs is governed by s 117 of the Family Law Act 1975 (Cth) (“the Act”), which relevantly 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.
In summary, each party is to bear their own costs, (s 117(1)), but an order for costs can be made if there are circumstances that justify it (s 117(2)), and for that purpose the relevant factors in s 117(2A) need to be addressed. However, it must not be forgotten that whether an order is made or not, is still an exercise of discretion.
The first appeal
In the end result, both parties seek an order for costs in relation to this appeal, which was an appeal against an order for costs made by the primary judge on 22 October 2018.
I am bemused by the husband attempting to seek an order for costs here. The appeal was unsuccessful, and none of the four grounds of appeal were found to have any merit. Further, the claim for costs was only raised in the “reply” filed by the husband, and there is absolutely nothing in that document which supports such an order being made, and it has been a complete waste of time for this Court to even have to consider it. As referred to earlier, most, if not all of the matters raised by the husband, relate to what occurred in the court below, and have no relevance to a claim for costs of the appeal. That criticism also applies to the matters the husband raises in opposition to the wife’s claim for costs here.
Turning to the wife’s claim for costs, the relevant factors from s 117(2A) are as follows:
(a) The financial circumstances of the parties
Neither party put any current information as to their respective financial circumstances before this Court for the purposes of the applications for costs. Thus, I am not in a position to take anything into account here in that regard; it is not for this Court to go back in time and to search high and low for material filed in the court below as to the financial circumstances of the parties.
(c) The conduct of the parties in relation to the proceedings
The wife relies on this factor as justifying an order for costs. In paragraph 9 of the written summary of argument filed on 4 June 2020, the wife details the conduct of the husband in seeking adjournments, in failing to comply with orders for the filing of documents, in taking up court time unnecessarily, and in turning up late at court. These matters relate to both appeals of course because they were being heard together, but clearly they are all still matters which go to the question of costs in relation to this appeal.
(e) Whether any party to the proceedings has been wholly unsuccessful in the proceedings
This factor is of course the primary circumstance that justifies an order for costs being made in favour of the wife. The appeal was wholly unsuccessful, and it cannot be argued that it was reasonable to institute the appeal. The appeal was against an order for costs which was amply justified by the circumstances that arose in the matter before his Honour. The husband applied for an adjournment which his Honour granted, but on the basis of the husband paying the costs of the wife thrown away as a result.
(f) Offers of settlement
There were “offers” made by the wife, but it is unclear if the wife is relying on these to justify an order for costs. In any event, there was no offer made which the husband should have accepted. For example, the offers were to the effect that the husband withdraw both appeals, and the wife would agree to discharge the order for costs which was the subject of the first appeal.
Plainly, there are circumstances arising under paragraphs (c) and (e) that justify an order for costs being made in favour of the wife in relation to the first appeal. However, I will return to this later in these reasons.
The second appeal
There are two questions here; first, should there be an order for costs in favour of the husband, and secondly, if so, should those costs be calculated on an indemnity basis.
As to the first question, it is necessary to consider the relevant factors in s 117(2A). However, before doing so, I note that again both parties seek an order for costs in relation to this appeal. It is understandable that the husband seeks an order, but to employ the same description as I did when considering the orders for costs sought in the first appeal, I am similarly bemused at the wife seeking an order, given that the second appeal was allowed.
There appear to be two bases for the wife seeking an order for costs; first, the conduct of the husband in relation to the hearing of the appeals, and secondly, the suggestion that this appeal was “an academic exercise” because there were intervention order proceedings on foot in the Melbourne Magistrates Court, where an interim order was in place excluding the husband from the home.
As to the second issue, that was a matter raised by the husband at the commencement of the hearing on 2 September 2019. However, I ruled that there was utility in the appeal proceeding. The husband argued that the primary reason for the Magistrate putting the exclusion order in place was because of the orders made by the primary judge here, and that was conceded by the wife’s counsel. The husband indicated that if the second appeal was successful, and the order of the primary judge was set aside, then he would apply to the Magistrate on that basis to discharge the interim order.
Thus, this appeal was not an “academic exercise”, and the pursuit of it by the husband cannot justify an order for costs in favour of the wife.
As to the first issue, there is clearly merit in the complaints that the wife makes about the husband’s conduct in the hearing of the appeals; Amended Notices of Appeal were filed, the husband and his Case Guardian were late for court, there were applications to adjourn, there was time taken up unnecessarily, and there needed to be more time allocated to the hearing of the appeals than would have been expected, given their nature.
Although this conduct can justify an order for costs in the wife’s favour, the more appropriate outcome is for this circumstance to be a basis for opposing (or even offsetting) any order for costs that might be appropriate in the husband’s favour as a result of the success of the appeal. I will return to this later in these reasons.
For now, I will address the relevant s 117(2A) factors in the context of the husband’s application for costs.
(a) The financial circumstances of the parties
There is nothing more that I can say about this factor. In the absence of any current information as to the respective financial circumstances of the parties, I am unable to take them into account.
(c) The conduct of the parties in relation to the proceedings
The only conduct of the wife that the husband can conceivably rely on is first, the fact of the wife opposing the appeal, and secondly, the issue of the wife’s inheritance. As to the latter, it certainly took some time for the wife to disclose the details of her inheritance, and in particular any income that she was entitled to from the Estate. However, eventually she did provide what she could, both by way of documents and by way of oral advice through her counsel. The documents then became the subject of an Application in an Appeal filed by the husband on 21 August 2019, seeking to adduce the same as further evidence in the appeal. That application was granted because the documents demonstrated error by the primary judge in his failure to take into account part of the contents of an affidavit of the husband that his Honour struck out and removed from the file, and which affidavit deposed to the wife’s inheritance, and related to her ability to move from the home in which she was residing (see [145] and [146] reasons for judgment delivered on 14 May 2020).
Thus, although relevant, the precise details of the wife’s inheritance were not the issue; the issue was the failure by his Honour to take into account the contents of the husband’s affidavit. The further evidence just confirmed that the wife was entitled to a substantial inheritance, and the tardiness in providing the detail of that was of no consequence in the appeal.
Accordingly, that conduct does not justify an order for costs.
As to the first issue, namely the wife’s opposition to the appeal, there is also no justification there for an order for costs.
The appeal succeeded on errors of law made by the primary judge, yet those errors were not such that it was unreasonable for the wife to oppose the appeal. Indeed, not all of the grounds of appeal were successful. And certainly there was nothing done by the wife which led his Honour into making the errors that he did.
(e) Whether any party to the proceedings has been wholly unsuccessful in the proceedings
Certainly, the wife was unsuccessful in the appeal, but she was not “wholly unsuccessful”. To repeat, not all of the grounds of appeal were found to have merit. Further, and to repeat, I am not persuaded that even with those grounds of appeal which did have merit, that it was unreasonable for the wife to oppose the appeal. And, again to repeat, it is not suggested that the wife led his Honour into the errors that he made.
Thus, there is no justification here for an order for costs.
In summary then, I can find no circumstances that would justify an order for costs in favour of the husband in relation to the second appeal. The effect of that is I do not need to address the second question as to whether indemnity costs should be awarded. I can say though that if it was necessary to consider that question, I would not be satisfied that there are exceptional circumstances requiring departure from the usual approach of costs being calculated on a party/party basis. Further, and in any event, there are the difficulties with the husband’s schedule of costs, and the failure to comply with r 19.08(3) of the Rules referred to above, and which would all militate against an order for indemnity costs as sought by the husband being granted.
Conclusion
I have found that in relation to the first appeal there are circumstances that would justify an order for costs being made in the wife’s favour.
In relation to the second appeal, I have found that there are no circumstances that would justify an order for costs in favour of the husband. Indeed, I have also found that if there were such circumstances, the conduct of the husband would provide a basis for the wife to oppose (or even offset) any order for costs in the husband’s favour.
Although there are two appeals here, they arise in the same proceedings between the same parties, and just as this Court consolidated the appeals and heard them together, the issue of costs arising from the outcomes should be considered together.
On that basis, in the exercise of the court’s discretion, I consider that there should be no order for costs in favour of either party. At the end of the day, although the wife was successful in having the first appeal dismissed, the husband was successful in having the more substantial second appeal upheld. In those circumstances it would be a strange result overall if the wife was able to obtain an order for costs in the first appeal, and there was no order for costs in the successful second appeal. It is the far more equitable result for each party to bear their own costs, and I will so order.
As identified earlier in these reasons, in the event that no costs order was made, both parties applied for costs certificates pursuant to the provisions of the Federal Proceedings (Costs) Act 1981 (Cth). Of course, such certificates could only be issued in relation to the second appeal; costs certificates are not available where an appeal is dismissed.
Although the success of the second appeal arises as a result of the errors made by the primary judge, and although I have found that each party should bear their own costs, given the circumstances of the two appeals I do not consider it appropriate for costs certificates to issue. Thus, I will be dismissing the respective applications for those certificates.
I certify that the preceding fifty-two (52) paragraphs are a true copy of the reasons for judgment of the Honourable Strickland J delivered on 28 July 2020.
Associate: FM
Date: 28 July 2020
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