Gillam and Waxweiler (Costs)

[2020] FCWA 186

JURISDICTION : FAMILY COURT OF WESTERN AUSTRALIA

ACT: FAMILY COURT ACT 1997

LOCATION: PERTH

CITATION: GILLAM and WAXWEILER (COSTS) [2020] FCWA 186

CORAM: SUTHERLAND CJ

HEARD: WRITTEN SUBMISSIONS

DELIVERED : 20 OCTOBER 2020

FILE NO/S: PTW 5345 of 2014

BETWEEN: MR GILLAM

Applicant

AND

MRS WAXWEILER

Respondent

Catchwords:

COSTS - Between parties in relation to parenting international relocation case - Circumstances not justifying order - Case turns on its own facts

Legislation:

Family Court Act 1997 (WA)

Category: Not Reportable

Representation:

Counsel:

Applicant	:	Not applicable
Respondent	:	Not applicable

Solicitors:

Applicant	:	Tolcon Legal
Respondent	:	Anthony R Clarke & Associates

Case(s) referred to in decision(s):

B & B [2015] FCWA 65

Collins & Collins (1985) FLC 91-603

Fitzgerald v Fish (2005) 33 Fam LR 123

Gillam and Waxweiler [2020] FCWA 66

Greedy and Greedy (1982) FLC 91-250

Hawkins & Roe [2012] FamCAFC 77

I and I (No 2) (1995) FLC 92-625

Luadaka v Luadaka (1998) FLC 92-830

Rice & Asplund (1979) FLC 90-725

WORDS IN SQUARE BRACKETS REPLACE WORDS USED IN THE ORIGINAL JUDGMENT – PARTIES’ NAMES AND IDENTIFYING DETAILS HAVE BEEN CHANGED

IT IS NOTED that publication of this judgment by this Court under the pseudonym Gillam and Waxweiler has been approved by the Family Court of Western Australia pursuant to s 243(8)(g) of the Family Court Act 1997 (WA).

Introduction

1[Mrs Waxweiler] (“the mother”) sought costs against [Mr Gillam] (“the father”), fixed in the amount of $105,000.[1] The father opposed the costs order sought by the mother and sought that there be no order for costs.

[1] The mother attached to her written costs submissions, a schedule setting out her total costs calculated at “scale rate” in the amount of $107,374. The schedule lacked sufficient detail for me to determine exactly how many of the costs claimed at scale were in fact calculated. In my view, on their face, a number of the costs claimed appeared to be high in light of the brief description provided as to the work undertaken. For example: (1) on 26/3/2018 charging $1,050 in relation to drafting a letter to “OP”; (2) on 16/4/2018 charging $1,250 for “an attendance on the file”; (3) on 26/4/2018 charging $2,000 to draft a 7 page letter to the father’s solicitor; (4) on 18/6/2018 charging $1,000 to draft a 5 page letter to the father’s solicitor; (5) on 9/8/2018 charging $1,000 to draft a 4 page letter to the father’s solicitor; (6) on 14/3/2019 charging $1,000 to draft a letter to the father’s solicitor; and (7) charging $34,875 in relation to drafting the mother’s trial documents, including multiple attendances upon the mother and the court for this purpose.

2The defended trial in relation to parenting issues concerning the parties’ young son took place before me over five days in January 2020 (“the 2020 trial”). The primary orders sought by the mother were that: she have sole parental responsibility for the child, and the child live with her and spend time with the father on the basis that she be permitted to relocate with the child to Switzerland. This was in the context that the parties had participated in a defended trial before Walters J in 2015 (“the 2015 trial”) where the mother was unsuccessful in her bid to relocate with the child to Switzerland.

3On the other hand, the primary order sought by the father at the commencement of the 2020 trial was that having regard to the rule in Rice & Asplund,[2] the mother’s application should be dismissed, such that the final parenting orders made in May 2015 pursuant to the 2015 trial remain in full force and effect. However, in his closing submissions, the father conceded that as a result of the nature of the evidence adduced during trial, he no longer maintained that the mother’s application should be dismissed. Instead, his primary position was that the court should make orders for the parties to have equal shared parental responsibility for the child, the child live in a shared arrangement with the parties in Western Australia, and that if the mother elected to return to Switzerland, then the child live with him in Western Australia and spend time with the mother.

[2] Rice & Asplund (1979) FLC 90-725.

4During the 2020 trial, the parties were able to reach agreement on some issues, and on 31 January 2020 they filed two minutes of orders that could be made by consent: one on the basis that the child was permitted to relocate with the mother to Switzerland; and the other on the basis that the child remained in Western Australia and lived with the father.

5On 30 April 2020, I published my reasons for decision (“Reasons”)[3] from chambers and re-listed the matter on 4 May 2020 to make orders pursuant to the Reasons. In short, I found that it was in the child’s best interests to discharge the May 2015 final orders and, instead, make final orders for the mother to have sole parental responsibility for the child, for the child to live with her and spend time with the father on the basis that the mother be permitted to relocate with the child to Switzerland. I also made orders:

a)In the terms of the minute of orders agreed to by the parties in the event that the mother was permitted to relocate with the child to Switzerland; and

b)In relation to a number of other disputed issues, including: (1) making orders as sought by the mother in relation to practical arrangements for the child’s flights to and from Switzerland; and (2) declining to make a number of orders sought by the father, including that the child attend a particular international school in Switzerland, as well as other orders that effectively sought to limit the mother’s rights as the parent with sole parental responsibility for the child and interfere with her ability to make parenting decisions on a day-to-day basis.

[3] Gillam and Waxweiler [2020] FCWA 66.

6At the re-listed hearing on 4 May 2020, I made final orders pursuant to my Reasons. I also made procedural orders to facilitate the determination of any costs application made by either the mother or the father. Pursuant to the procedural orders made by me, the mother filed her written costs submissions on 2 June 2020. The father filed his responsive submissions on 26 June 2020, together with an up-to-date financial statement. The mother exercised the liberty granted to the parties to seek a re-listing of the matter to make further oral submissions. That hearing took place on 13 July 2020, during which further oral submissions were made on behalf of both parties. At that hearing, I made an order permitting the father to file further written submissions. He did so on 24 July 2020.

Legal Principles

7Section 237(1) of the Family Court Act 1997 (WA) (“the Act”) provides that, subject to s 237(2) and s 205SB and s 242, each party to proceedings under the Act is to bear that party’s own costs. Section 237(2) provides that if the court is of the opinion there are circumstances that justify so doing, the court may, subject to subsections (3), (5), (6A) and (6) and in accordance with any relevant rules, make such order as to costs as it considers just.

8Section 237(3) provides that in considering what order (if any) should be made, the court must have regard to:

a)the financial circumstances of each of the parties to the proceedings; and

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; and

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; and

d)whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of a court; and

e)whether any party to the proceedings has been wholly unsuccessful in the proceedings; and

f)whether a party to the proceedings has made an offer in writing to another 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.

9Neither the mother nor the father maintained that s 237(3)(b) or (f) were relevant considerations and I am satisfied that this is the case. I now turn to a consideration of the remaining factors pursuant to s 237(3).

The financial circumstances of each of the parties to the proceedings

10In my Reasons, I found that the mother had modest assets and superannuation entitlements, and that having regard to her debt for her litigation costs, she owed more than she was worth. There was little, if any evidence, as to the mother’s likely income upon her return to Switzerland, including from child support payments or any government benefits and/or pension payments she may become entitled to receive. I was satisfied that in all probability, the mother would be substantially financially supported by her husband. I also found that the father’s current income was approximately $1,788 per week, including his salary and other benefits from his employment and some very modest Centrelink family payments. The father had assets and superannuation entitlements totalling approximately $200,000, together with modest debts totalling approximately $24,600.

11The father filed an up-to-date financial statement, in which he deposed that: (1) his income had increased slightly to approximately $1,878 per week; (2) his personal expenditure was approximately $2,157 per week, including child support payments for the child of approximately $171 per week, loan repayments of over $400 per week and an allowance for holidays of $120 per week, effectively to facilitate his time with the child; (3) his total assets were valued at approximately $31,897; (4) his superannuation entitlements were valued at approximately $187,870; and (5) he had liabilities of approximately $136,920, including outstanding legal costs to his solicitors and personal loans to his parents and various financial institutions. In his written costs submissions, the father provided further information in relation to his liabilities, including that his litigation costs were primarily funded by borrowings.

12The mother maintained that the father was in a “far superior financial position” than her and that his financial circumstances “clearly allow for him to satisfy a costs order”. I disagree and accept the father’s submission that he does not have the capacity to meet a costs order and that any order for costs would cause him severe financial hardship.

13I am satisfied that disregarding his superannuation entitlements, the father also owes more than he is worth. Although the father has a greater income than the mother, he also has significant expenses to meet, including ongoing child support for the child and meeting his airfares, 50 per cent of the child’s airfares and any associated accommodation costs to facilitate him spending time with the child. As such, I am not satisfied that: (1) the father could draw down on his existing assets to meet a costs order; or (2) the father has the necessary borrowing capacity to obtain a further loan to satisfy a costs order; or (3) the father could meet a costs order from his income. I am satisfied that any order for costs is very likely to cause the father to suffer severe financial hardship and may well detrimentally impact on his financial capacity to spend time with the child.

The conduct of the parties to the proceedings in relation to the proceedings

14The mother submitted that the father’s conduct as a litigant increased her litigation costs on a number of fronts.

15 Firstly, the father commenced these proceedings in 2017 on an urgent basis and was successful at the first return date on 17 April 2017 in obtaining an ex parte injunction preventing the mother from removing the child from Australia and placing the child on the Family Law Watch List. In my Reasons, I was not persuaded that the father’s concerns about the mother unilaterally relocating with the child were genuinely held by him, and considered that his actions smacked of opportunism. However, I am not satisfied that the father’s conduct in urgently commencing the proceedings unnecessarily added to the mother’s costs, particularly in circumstances where, on her own evidence, she had also instructed her solicitor to commence proceedings in any event.

16The mother maintained that she was subsequently put to added expense in having to seek the father’s consent to the watch list order being lifted every time she sought to travel to Switzerland in accordance with the May 2015 final orders. However, I am not persuaded that the father unnecessarily caused the mother to incur additional expenses in this regard, for the following reasons: Firstly, at the next hearing on 26 June 2017 the father proposed that the orders made on 17 April 2017 be discharged, including the watch list order.

Nevertheless, the mother’s own position was at the hearing, the presiding magistrate determined that an order should be made requiring the child to remain on the watch list (subject to specific travel arrangements).[4] Secondly, the mother’s proposed travel arrangements did not always strictly accord with the May 2015 final orders, meaning that she would have been obliged to seek the father’s consent to the changed arrangements in any event.

[4] The parties were in dispute as to whether the order made on 26 June 2017 in relation to the child continuing on the watch list was correctly extracted. The father maintained that the order was incorrectly extracted, and accordingly, was capable of being corrected under the slip rule. On the other hand, the mother’s counsel maintained that the presiding magistrate made a determination that the child should remain on the watch list, and accordingly the order was correctly extracted. I made no findings about this issue in my Reasons.

17 Secondly, at trial, the father’s primary position was that the mother’s application to relocate should be dismissed in accordance with Rice & Asplund, such that the final parenting orders made in May 2015 remain in full force and effect. However, the father’s counsel conceded in closing that, as a result of the nature of the evidence adduced during trial, the father no longer maintained that the mother’s application should be dismissed. In the mother’s written costs submissions, she maintained that the father first raised the Rice & Asplund issue in correspondence in 2018, sought that the mother withdraw her application to relocate, and put her on notice in relation to costs in the event that he was successful at trial in a Rice & Asplund argument. It is apparent from the mother’s written costs submissions that, over time, the parties’ solicitors continued to exchange correspondence about the issue.

18The mother submitted that it should have been obvious to the father that her circumstances had changed since 2015, as: (1) she had subsequently married; (2) her husband continued to live in Switzerland; and (3) she and her husband subsequently had a child together. The mother further submitted that the father’s position in relation to the Rice & Asplund issue had “no chance of success and should never have been raised in these proceedings” and that his conduct in relation to the Rice & Asplund issue only served to increase her costs and waste the court’s time. I disagree. I am not persuaded that the Rice & Asplund issue was as obvious or as unmeritorious as the mother maintained, or that that the father was unreasonable in putting the mother “to proof” in relation to the issue. This was particularly as the mother’s and her husband’s relationship was already well established by the time of the 2015 trial and was the subject of some discussion by Walters J in his reasons for decision.

19 Thirdly, the mother submitted that the father failed to provide full and frank disclosure of relevant documents, including: (1) certain issues regarding the child’s school; and (2) a therapist’s appointment attended by the paternal grandparents and the child. I am satisfied that the father did not disclose that: (1) the school fees were significantly in arrears; and (2) he and the paternal grandparents had attended meetings and had communications with the school. The mother only became aware of these matters after issuing a subpoena to the school just prior to the 2020 trial. I am also satisfied that the father did not disclose the therapist’s involvement in the matter and then provided “a cynical and misleading response” to the mother’s “proper request for clarification”. I accept the mother’s submission that the father’s conduct in this regard unnecessarily added to her costs.

20I accept the father’s submission that there were also some aspects of the mother’s conduct during the proceedings, particularly in relation to the late filing of some documents, which may have unnecessarily added to his costs.

Whether any party to the proceedings has been wholly unsuccessful in the proceedings

21The mother submitted that the father was wholly unsuccessful in the proceedings, in that the dispute which lay at the heart of the proceedings was whether the child should live with her and be permitted to relocate to Switzerland. In my view, the mother’s submission was too simplistic and ignored the fact that there were a number of interim proceedings, in relation to which the father was either wholly or partly successful (including the child being tested for dyslexia and attending counselling). Whilst the father was unsuccessful at trial in opposing the relocation, that is not to say that the father’s position was without merit (particularly having regard to the outcome of the 2015 trial), or that he was not entitled to put his case and seek orders that he believed to be in the best interests of the child.[5]

Such other matters as the court considers relevant

[5] Hawkins & Roe [2012] FamCAFC 77, [14].

22The mother submitted that the court should also take into account that the father’s conduct as a litigant “was appalling” and pointed to a number of specific findings in the Reasons that were very critical of the father. In my Reasons, I found that the father was an unimpressive witness: who was prone to exaggerate his complaints about the mother; who was at times defensive and combative under cross-examination, and who at times lacked candour. However, in my view, many of the criticisms specifically identified by the mother in her written costs submissions related to the father’s attitude to the mother and his decisions as a parent, rather than as a litigant.

Conclusions

23The discretion to award costs is a “broad” one, and the various enumerated factors are not to be read in any restrictive way.[6] Any one of the factors may be the sole foundation for an order for costs.[7] Nevertheless, the matters enumerated “must all be taken into account and all balanced in order to determine whether the overall circumstances justify the making of an order for costs”.[8] It is unnecessary to spell out detailed reasons for decisions in costs matters. An exercise of discretion to order costs will be upheld if it appears to the appellate court that there are reasons upon which the trial judge or magistrate could rely.[9]

[6] Collins & Collins (1985) FLC 91-603.

[7] Fitzgerald v Fish (2005) 33 Fam LR 123.

[8] I and I (No 2) (1995) FLC 92-625, 82,277.

[9] B & B [2015] FCWA 65; Greedy and Greedy (1982) FLC 91-250; Luadaka v Luadaka (1998) FLC 92-830.

24On balance, I am not persuaded that the circumstances justify the making of a costs order in favour of the mother. Although I am satisfied that some aspects of the father’s conduct as a litigant unnecessarily increased the mother’s costs, I am also satisfied that the father would struggle to meet any costs order. Whilst impecuniosity is no bar to the making of a costs order, I am nevertheless satisfied that making a costs order in this case would very likely cause the father to suffer severe financial hardship and may adversely impact on his financial capacity to spend time with the child.

Orders

25I intend to make the following order: All outstanding applications be dismissed.

I certify that the preceding paragraph(s) comprise the reasons for decision of the Family Court of Western Australia.

KV

Associate

20 OCTOBER 2020