Haines & Rader (No 6)
[2023] FedCFamC1F 255
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Haines & Rader (No 6) [2023] FedCFamC1F 255
File number: SYC 1641 of 2019 Judgment of: BRASCH J Date of judgment: 6 April 2023 Catchwords: FAMILY LAW – COSTS - Where wife seeks costs on an indemnity basis with respect to her application to enforce final orders and her response resisting the husband’s s 79A application – Where husband did not make submissions as provided for in orders – Where disparity in financial circumstances – Where husband wholly unsuccessful – Where husband ran his s 79A case on, inter alia, rank hearsay and speculation- Where quantum of costs considered reasonable, proper, fair and proportionate - Costs Order made on an indemnity basis Legislation: Family Law Act1975 (Cth) ss 79A, 117(1), 117(2), 117(2A)(a)-(g), 117(4), 117(4A),117(5), 117(6)
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) rr 10.13(1)(a), 12.13(4), 12.13(5)
Cases cited: Allesch v Maunz(2000) 203 CLR 172; [2000] HCA 40
Bant & Clayton (Costs) (2016) 56 Fam LR 31; [2016] FamCAFC 35
Bokin & Wild [2022] FedCFamC1A 209
Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225
Dongahey & Dongahey (Costs) (2012) 47 Fam LR 306; [2012] FamCA 231
Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) & Fish (2005) 33 Fam LR 123; [2005] FamCA 158
Harris & Dewell (No 2) (2018) FLC 93-863; [2018] FamCAFC 180
Haines & Rader (No 2) [2022] FedCFamC1F 685
Haines & Rader (No 3) [2022] FedCFamC1F 1007
Haines & Rader (No 4) [2022] FedCFamC1F 1008
Haines & Rader (No 5) [2023] FedCFamC1F 132
Madden and Madden (1979) FLC 90-710; [1979] FamCA 72
Medlon & Medlon (No. 6) (Indemnity Costs) (2015) FLC 93-664; [2015] FamCAFC 157
Munday v Bowman (1997) FLC 92-784
Prantage & Prantage (Costs) [2014] FamCA 850
Rankin and Rankin (No 3) [2019] FamCAFC 133
Sfakianakis& Sfakianakis (2019) 59 Fam LR 419; [2019] FamCAFC 54
Yunghanns v Yunghanns (2000) FLC 93-029; [2000] FamCA 681
Division: Division 1 First Instance Number of paragraphs: 70 Date of last submissions: 17 March 2023 Date of hearing: 3 March 2023 Place: Sydney Solicitor for the Applicant: Dettmann Phair Lawyers Solicitor for the Respondent: Morson Law ORDERS
SYC 1641 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MS HAINES
Applicant
AND: MR RADER
Respondent
order made by:
BRASCH J
DATE OF ORDER:
6 APRIL 2023
THE COURT ORDERS THAT:
1.The husband pay the wife’s costs on an indemnity basis in the amounts of:
(a)$21,921 (including GST) for the wife’s Application in a Proceeding filed 25 January 2023; and
(b)$17,503 (including GST) for her Response filed 27 February 2023 in relation to the husband’s Application in a Proceeding.
2.The husband is to make the above payments within 28 days of 6 April 2023.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under a pseudonym has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
BRASCH J:
INTRODUCTION
This is my fifth set of Reasons in this matter, which only came before me at a Case Management Hearing on 22 August 2022. To understand the recent litigation, these Reasons should be read in conjunction with my previous judgments:
(a)Haines & Rader (No 2) [2022] FedCFamC1F 685 (“Haines & Rader (No 2)”): this concerned the husband’s “application by email” to adjourn the trial, which I did not entertain;
(b)Haines & Rader (No 3) [2022] FedCFamC1F 1007 (“Haines & Rader (No 3)”): this concerned the husband’s application pursuant to r 10.13(1)(a) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) (“the Rules”) to set aside orders I made with respect to some subpoena issued by the husband (see orders made 5 September 2022), but primarily, my order dismissing the husband’s “application by email” to adjourn the trial, along with the provision of the transcript (orders made 6 September 2022); I dismissed the application;
(c)Haines & Rader (No 4) [2022] FedCFamC1F 1008 (“Haines & Rader (No 4)”): this is the orders and Reasons in the substantive s 79 proceedings;
(d)Haines & Rader (No 5) [2023] FedCFamC1F 132 (“Haines & Rader (No 5)”): this concerned:
(i)the wife’s application for enforcement of the substantive orders, primarily seeking a Warrant of Possession for the former matrimonial home, which the husband, contrary to orders, had neither vacated nor facilitated the orders for sale; and
(ii)the husband’s application to set aside the substantive 21 December 2022 orders pursuant to s 79A of the Family Law Act1975 (Cth) (“the Act”).
(iii)He also sought to file some subpoena, but as his counsel appropriately accepted that if I dismissed the s 79A application, then the subpoena issue also fell away.
I heard the competing s 79A and enforcement applications in a half day hearing on Friday, 3 March 2023 and delivered an ex tempore judgment on Tuesday, 7 March 2023. I dismissed the husband’s s 79A application, declined to issue subpoena by him, and made orders consistent with those sought by the wife by way of enforcement. Having raised a costs process with the parties when they were before me, I also made the following orders:
Costs
16.Any party wishing to agitate for costs do so by filing and serving written submissions within fourteen (14) days of the date of this order.
17.The other party is to file and serve written submissions in reply fourteen (14) days after the service of any written submissions provided for in Order 16 above.
18.The need to file an Application in a Proceeding with respect to costs is dispensed with.
19. The parties are agreed the issue of costs be determined in Chambers.
That order contained the below notation:
THE COURT NOTES THAT:
A. In the event either party files and serves written submissions, the parties are to email a copy to chambers (via […@...]) copied to the other party.
I dispensed with the need to file an Application in a Proceeding with respect to costs as each party sought costs in their respective applications/responses. More particularly, the wife sought costs on an indemnity basis in both her application and response. The husband sought he have his costs of his s 79A application, but that each parties’ costs of and incidental to the wife’s enforcement application be reserved.
Costs submissions made and not made
On 17 March 2023, the wife filed written submissions seeking indemnity costs arising out of my Reasons and Orders of 7 March 2023 (being from the s 79A, subpoena and enforcement hearing). The husband was served with the submissions by email on 18 March 2023; that was a Saturday. Being generous to the husband, time commenced Monday 20 March 2023.
Accordingly, the husband ought have filed his submissions 14 days thereafter. He did not. When listing the matter for delivery of judgement (on 5 April 2023), nothing had been filed by the husband.
The husband has been legally represented throughout the course of his s 79A application and the wife’s enforcement application. When the wife’s submissions were sent to chambers, Ms Morson (the husband’s solicitor) was again included in that communication. There has been no demur from her that the submissions were served on 18 March 2023.
The husband is not a novice to litigation. Arising out of his non-attendance at the trial on 6 September 2022, the husband was provided with the trial transcript and an opportunity to make written submissions. He did not take up that opportunity, which has been discussed a number of times and included in at least Haines & Rader (No 5) at [16]:
The husband was made acutely aware that should he not take up that opportunity to be heard, judgment would be delivered. In [Haines & Rader] (No 3) (at [37]-[38]), I referred to the steps taken by the wife’s solicitors to make sure the husband was alert to this. I accepted what he said then and still do now:
…the solicitor for the wife highlighted that the husband was afforded procedural fairness not once but twice. First, he was afforded the opportunity to attend at the trial, which I have already set out. I am well satisfied the husband knew of the trial dates.
Second, the husband was given a further opportunity to be involved in the trial by my making orders that he be provided with the transcript and provide written submissions. He did not do that. The solicitor for the wife listed the steps he took to ensure that my order about the submissions and the transcript were brought to the husband’s attention. I accept, as I said, what he said. It was not disputed by the husband…
Here too, the husband has not made submissions. He has had the opportunity to be heard. In this matter, I have three times quoted Kirby J in Allesch v Maunz(2000) 203 CLR 172 at [38]–[40] and do so again:
...Sometimes, through stubbornness, confusion, misunderstanding, fear or other emotions, a party may not take advantage of the opportunity to be heard, although such opportunity is provided. Affording the opportunity is all that the law and principle require.
Decision-makers, including the courts, cannot generally force people to protect their own rights, to adduce evidence or other materials, to present submissions or to act rationally in their own best interests. This consideration may be especially relevant in relation to the Family Court where emotions, often engendered by the highly personal issues involved, can sometimes cloud rational thought.
Nor are courts obliged to delay proceedings indefinitely because one party, although proved to be on notice of the proceedings, refuses or fails to appear in person or to be represented by a lawyer or some other individual permitted to speak for them who can explain the need for an adjournment. The rights of other parties are commonly involved. In the Family Court, the rights of non-parties (especially children) may be affected. Additionally (as this Court has itself accepted, the rights of the public in the efficient discharge by courts of their functions must be weighed against unreasonable delay in concluding litigation
I am satisfied the wife’s submissions came to the attention of the husband through his lawyer. I am satisfied the husband has had the opportunity to be heard. Dates in orders for parties to do things, for example, to file submissions, are not guides or options. This is not the first time I have said that in this matter.
On 20 April 2023, I will be hearing an Application in a Proceeding filed by the husband on 24 March 2023 seeking “That the Orders made 21 December 2022 and the Orders made on 7 March 2023 be stayed pending determination of the husband’s Appeal to be filed by close of business on 24 March 2023”. The husband’s appeal does not concern my orders as to costs. He also appeals an order he says I made on 3 March 2023 about the inadmissibility of some Administrative Appeals Tribunal (“AAT”) prohibited material, but I did not make an order. Rather, I indicated why I was against the husband’s counsel’s interpretation of the AAT’s prohibition order and relevant legislation. In any event, when the husband’s counsel initially tried to get the prohibited material in via a call for the documents responding to the husband’s Notice to Produce she subsequently (and properly) abandoned that:
MS RUSITI: Your Honour, I think I – the difficulty appears to me, with the notice to produce, that, were my friend to produce the documents to me, I could not, then, do anything with them.
HER HONOUR: Yes.
MS RUSITI: Thank you, your Honour, for giving me the opportunity to think that through.
(Transcript 3 March 2023, p.29 lines 7-14)
The receipt of that material - which the husband’s counsel ultimately abandoned – is not a matter that relates to the costs orders I made.
The husband has had ample opportunity to make submissions about costs. He has not. I see no reason to delay delivering judgment in the wife’s costs application arising out of the s 79A, subpoena and enforcement hearing. If the husband is unhappy with my reasons and orders herein, he can no doubt take advice.
Brief background
Ms Haines, born 1970 (“the wife”), initiated the proceedings on 15 March 2019 by filing an Initiating Application for Final Orders in the Federal Circuit Court as it was then. Mr Rader, born 1968 (“the husband”) joined issue with the proceedings by filing a Response on 7 April 2019.
The wife and the husband (“the parties”) commenced cohabitation in 2003. The parties married in 2009. I have previously found they separated in August 2017. Both parties agreed the divorce order was made in March 2020.
The parties have two children; X, born 2005, and Y, born 2006 (“the children”). It is common ground the children have not spent time with the wife since mid-September 2018.
Material - costs
The wife relied upon the following material:
·Order 14 of her Application in a Proceeding filed 25 January 2023, and Order 3 of her Response filed 27 February 2023 with respect to the husband’s Application in a Proceeding;
·Affidavit of Damian Grant Phair filed 2 March 2023 at 7.30 pm;
·Affidavit of Damian Grant Phair filed 2 March 2023 at 7.33 pm; and
·Written Submissions filed 17 March 2023.
The husband did not favour the Court with submissions.
Costs
Section 117(1) of the Act provides that each party will bear their own costs. That general rule is subject to s 117(2), which provides that a court may make such order for costs as it considers just if “…the court is of opinion that there are circumstances that justify it in doing so…”.
The factors that are to be considered when contemplating the making of a costs order are those set out in s 117(2A) of the Act; albeit the court may give such weight as it considers appropriate to any relevant factor (Medlon & Medlon (No. 6) (Indemnity Costs) (2015) FLC 93-664 at [24]).
It is well settled that no single factor in s 117(2A) has priority, nor must more than one factor be satisfied; rather, any one factor may be sufficient; Prantage & Prantage (Costs) [2014] FamCA 850 at [12]; Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) & Fish (2005) 33 Fam LR 123 at [41].
The first issue to address is has the wife established any circumstances which justify departing from the position that each party pay their own costs and the making of a costs order in her favour. The second question is whether, if there are circumstances justifying a costs order, on what basis should the husband should pay the wife’s costs – for example as was said in Sfakianakis& Sfakianakis (2019) 59 Fam LR 419 at [10]:
It is, however, a mistake to think that if a costs order is made, that order can only be on a party and party basis or on an indemnity basis. The words “such order as to costs ... as the court considers just” permit the Court to fashion an order that is apt to the circumstances. One such well-known example is assessment on a trustee basis, which is more generous than party and party costs, but falls short of an indemnity. Orders for a partial indemnity or for a particular period are obvious possibilities. The Court may also fix costs in a particular sum, taking account of all relevant circumstances; that type of order too is neither one for party and party costs nor an indemnity costs order. For convenience, in these reasons we shall refer to such orders as a “special costs order”.
Has the wife established any circumstances which justify departing from the position that each party pay their own costs, and the making of a costs order in her favour
(a) the financial circumstances of each of the parties to the proceedings;
The wife submits, “the financial statements of the husband and the wife confirmed that the wife earns jobseeker of $321 and the husband earns just over $3,000 per week” (Written submissions filed 17 March 2023, paragraph 12(a)).
The husband has not put on any submissions to cavil with this.
In the s 79A / enforcement hearing the husband relied upon rank hearsay that the wife had some employment. In Haines & Rader (No 5), I said this at [83]-[85]:
The highest the evidence goes is that well before my judgment, someone told the husband something about the wife having some kind of job, and there was “potential” the wife knew or may have “anticipated” this prior to the final hearing. Consequently, the husband is “concerned” the Court “may have been” misled “if it transpires” the wife was aware of possible employment.
That is it.
The husband’s counsel quite rightly accepted the husband’s paragraphs constituted rank hearsay and would attract little weight. I agree.
(Emphasis in original)
I was unpersuaded by that speculation then, and remain so now.
I am satisfied the parties’ financial circumstances is a factor to be given some weight.
(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;
There is no suggestion that either party is in receipt of legal aid.
(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;
The wife submitted:
the conduct of the parties under this subsection does not cover the kinds of things that might be said of the husband in this matter which is that he intentionally delayed the proceedings and brought an application and filed a response which has no merit, but which is discussed below
(Written submissions filed 17 March 2023, paragraph 12(c))
To my mind, this subsection seems to be more directed at engagement with process or procedural issues. However, I accept cases such as Dongahey & Dongahey (Costs) (2012) 47 Fam LR 306 (“Dongahey”) at [41] indicate conduct such as non-compliance with orders is relevant to s 117(2A)(c). However, in light of the wife’s submissions, I will consider the husband’s conduct as part of s 117(2A)(d) and (g).
(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;
The wife submitted, “the proceedings were necessitated by the failure of the husband to comply with the final orders and vacate the [Suburb J] property and facilitate the sale of the [Suburb J] property” (Written submissions filed 17 March 2023, paragraph 12(d)).
Plainly, the wife’s enforcement application is a result of the husband’s deliberate and considered failure to comply with the substantive court order, including that he vacate the home and facilitate the sale process. At the hearing of the s 79A / enforcement applications, it was common ground that the husband remained in the home contrary to orders.
It was said in Dongahey at [41]:
But, the integrity of this system depends on compliance with the Orders made by the Court. This is no more or less true for parenting proceedings than it is for property proceedings, or in general litigation. The rule of law central to the healthy functioning of a democracy has no less application in this Court or in family law more generally.
There is no suggestion from the husband that his non-compliance is due to factors wholly beyond his control (Madden and Madden (1979) FLC 90-710). Put squarely, he has just not complied.
The wife’s enforcement application was the only lawful way she had to facilitate the husband vacating the property and the sale process occur. It arose solely in response to the unilateral conduct of the husband in not complying with the substantive s 79 court order.
I give the husband’s non-compliance with the substantive orders considerable weight, and thus the cost to which the wife has been put to enforce the substantive order.
(e) whether any party to the proceedings has been wholly unsuccessful in the proceedings;
The term “wholly unsuccessful” refers to a situation in which proceedings as a whole have been unsuccessful, rather than necessarily an application (see Bant & Clayton (Costs) (2016) 56 Fam LR 31).
Thus, while the wife is correct in contending that the husband has been wholly unsuccessful in resisting the wife’s application and prosecuting his own application, the subsection itself refers to being wholly unsuccessful in the proceedings. Looking at the proceedings, the husband sought 104 per cent of the pool (or no adjustment with the former matrimonial home in his sole name). I ordered the wife have 60 per cent and the husband the balance less specific costs. It is hard to see how his claim and the result is anything but wholly unsuccessful.
The wife contends that that is a strong factor that favours the granting of costs. In my view, it is but one aspect of the wider considerations.
(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
This does not arise.
(g) such other matters as the court considers relevant.
With respect to the wife’s enforcement application, I have already observed it was necessitated by the husband’s failure to comply with the substantive orders. In addition:
(a)the husband’s Response was filed out of time – it was due 10 February 2023 but not filed until 13 February 2023;
(b)the husband did not seek a dismissal of the wife’s enforcement application – that is, he should have conceded the application in a timely manner but instead he put the wife to the costs of a hearing; and
(c)one of the husband’s orders in his Response was incompetent and appropriately not pressed by his counsel at the hearing, but prior to that concession, the wife still had to contemplate it:
…the Orders made on 21 December 2022 and the Application in a Proceeding filed by the Wife on 25 January 2023 be stayed pending the obtaining by the husband of legal advice in relation to prospects of success of appealing the Judgment of her Honour Justice Brasch dated 21 December 2022.
(As per original)
(Order 3 as contained in the husband’s Response filed 13 February 2023)
The wife submitted:
the notice to produce and documents sought to be tendered by the husband caused the Wife to incur further cost because the husband was seeking documents to be produced to the court and seeking to tender documents to the court when the Administrative Appeals Tribunal had ordered that those documents not be disclosed.
(Written submissions filed 17 March 2023, paragraph 12(g)(i))
I will not take that into account on this costs application. The documents were few in number.
The wife also submitted:
the husband’s application and response inter alia relied on very poor and flimsy evidence. The husband’s evidence that he relied on to support his application and response was almost the same as or similar to the evidence which he relied on in his application which was before the court on 19 December 2022 and which the court dismissed and found that “it was disingenuous of the husband to bring an application on very poor and flimsy evidence” and “although the submission was not made, had it been, I would have considered that this application was an abuse of process”([Haines & Rader] (No 3) [2022] FedCFamC1F 1007 at [53]).
(Written submissions filed 17 March 2023, paragraph 12(g)(ii))
The husband’s evidence on his s 79A application was indeed flimsy and poor. I have already referred to the rank hearsay under the financial circumstances above and will not double count it here. I have also referred to the fact that he did not seek an order dismissing the wife’s enforcement application.
The wife also submitted that the husband has intentionally delayed these proceedings given that:
the husband was aware prior to the final hearing that the [Suburb J] property might have to be sold and deposed that he understood that was an option and that he would move into a three-bedroom apartment ([Haines & Rader] (No 5) [2023] FedCFamC1F 132 at [124]).
The final orders provided for the sale of the [Suburb J] property
the husband has not signed the agency agreement and has refused or otherwise declined to engage with the agent or the conveyancing solicitor to enable the property to be sold (ibid at [125]).
The husband has not complied with the order to vacate the [Suburb J] property on or before 18 January 2023 (ibid at [126]).
The husband has frustrated the sale process to be embarked upon for example, by not signing the agency agreement. It is upon the sale proceeds being realised that both parties are paid their main entitlements. (ibid at [127]).
The husband filed a response but did not seek dismissal of the wife’s enforcement application (ibid at [128]) and at the very least should have submitted to the orders sought by the wife but did not. The husband’s Counsel very properly submitted that there was very little that could be said to resist the application (ibid at [128]) which is further evidence of the husband’s delay.
(Written submissions filed 17 March 2023, paragraph 12(g)(iii))
I have already considered the issue of non-compliance with orders, but it is incontrovertible that his non-compliance has delayed the parties receiving their entitlements from the sale of the home.
Subsections 117(4) and (5) concern Independent Children’s Lawyers (“ICL’s”); this is irrelevant. Section 117(4A) is also irrelevant dealing as it does with s 91B interventions. Subsection 117(6) is about guardians ad litem. It is irrelevant.
Conclusion on justifying circumstances
In the exercise of my discretion, I conclude that the following factors justify an order for costs in the wife’s favour: the disparity in the parties’ financial circumstances; the husband’s failure to comply with orders; the husband’s stance in his response that the enforcement application not be dismissed; and, that he has been wholly unsuccessful in the proceedings as overall.
On what basis should the husband should pay the wife’s costs
The wife submits the Court ought award her indemnity costs and specifically:
(a)$21,921 (including GST) for her Application in a Proceeding filed 25 January 2023 (to enforce the substantive order); and
(b)$17,503 (including GST) for her Response filed 27 February 2023 to the husband’s Application in a Proceeding (the s 79A application).
An order for indemnity costsis a significant departure from the normal standard and requires something exceptional: Harris & Dewell (No 2) (2018) FLC 93-863, where the Full Court said at [23]-[25]:
In Kohan and Kohan, the Full Court held, in applying the principles expounded by Sheppard J in Colgate-Palmolive, that an order for indemnity costs represents a “very great departure from the normal standard”. In the later decision of the Full Court in Prantage & Prantage, Thackray and Ryan JJ referred to Kohan and other authorities in the Full Courts of both this Court and the Federal Court of Australia as well as the state appeal courts. Their Honours concluded (at [86]) that the “usual rule” continued to apply in respect of awards of costs in this Court notwithstanding the Full Court accepting that the difference between party/party costs and a party’s actual costs has continued to grow significantly.
That proposition also derives support from what Callinan J said in Arundel Chiropractic Centre Pty Ltd v Deputy Commissioner of Taxation. His Honour said that an order for indemnity costs should “be exceedingly rare, as they have a tendency to encourage extravagance and put the quantum of legal fees beyond the effective scrutiny of the courts and their taxing officers”.
The rarity of an order for indemnity costs can also be seen illustrated by the comments of Lindgren J in NMFM Property Pty Ltd v Citibank Ltd (No 2), referred to by their Honours in Prantage (at [102] – [103]). Lindgren J said that there is no rule that indemnity costs will be ordered “where the losing party was guilty of ethical or moral delinquency in the antecedent facts which have given rise to the litigation.”
(Footnotes omitted)
In the well-settled authority of Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225 (“Colgate-Palmolive”) Shepherd J provided some examples of circumstances that might justify the awarding of indemnity costs, and usefully, Holden CJ in Munday v Bowman (1997) FLC 92-784, at 84,660, drew from his Honour’s decision those examples:
(a)Where it appears that an action has been commenced or continued in circumstances where a party properly advised should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive or because of some wilful disregard of the known facts…
(b)Making allegations of fraud, knowing them to be false, and the making of irrelevant allegations of fraud…
(c)Evidence of particular misconduct causing loss of time to the court and to other parties…
(d)The making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions…
(e) An imprudent refusal of an offer to compromise.
That said, the categories of circumstances which enliven the discretion to award indemnity costs are not closed (Yunghanns v Yunghanns (2000) FLC 93-029 at [31]).
The wife submitted (in summary) that:
·the husband should have known he had no chance of success and must be presumed to have an ulterior motive in the proceedings – the poor and flimsy evidence; his non-compliance with orders;
·the husband makes false or irrelevant allegations – for example, saying he had a tender bundle before the court at the trial when he did not; trying to tender documents that were the subject of an AAT prohibition order; relying on rank hearsay and speculation to found his s 79A application;
·there is evidence of particular misconduct by the husband causing loss of time to the parties and the court - the poor and flimsy evidence; his non-compliance with orders; and the matters set out at paragraphs 10(b)-(z) of the wife’s 27 February 2023 affidavit being the wife’s account of the husband’s non-compliance and applications in the full gamut of these proceedings; and
·the husband unduly prolongs a case with groundless contentions – here the wife essentially repeats and relies upon all she has submitted above.
I have already found the husband’s s 79A case was founded on poor and flimsy evidence. It is common ground that he has not complied with the substantive orders. The consequence of his deliberate non-compliance has been delay. It was accepted by his counsel, very appropriately, that sending a proposed Tender Bundle to a generic court email address did not make it evidence before me.
I will not take into account the matters set out at paragraphs 10(b)-(z) of the wife’s 27 February 2023. I consider those to be more relevant to the vexatious litigant application which is before me. It is also the case that various costs orders have been made against the husband for some of those matters so I also do not take those matters into account for fear of doubling up.
Pursuant to r 12.13(4) of the Rules a party applying for costs on anindemnity basis must inform the Court if that party is bound by a costs agreement in relation to those costs and the terms of that agreement. The wife entered into a costs agreement with Dettmann Phair on 19 January 2022. It is attached to the affidavits of Mr Phair both filed on 2 March 2023. It sets out the firm’s hourly rates for different personal, being $490 per hour plus GST for Mr Phair, $400 per hour plus GST for a senior solicitor and a paralegal is charged at $240 per hour plus GST. The wife was given several written notices that those fees would increase from 1 July 2022 and was told the amounts; that is in evidence before me too.
The husband has not taken the opportunity given to him to file any submissions in response, which obviously included the opportunity to cavil with the quantum and basis of costs sought by the wife. Nevertheless, the onus is on the wife to satisfy me that “the circumstances of the case must be such as to warrant the Court in departing from the usual course” (Colgate-Palmolive at [17]).
For a number of reasons, I consider that this is one of those exceptional cases where costs on an indemnity basis are appropriate.
First, the husband’s s 79A application was fundamentally flawed for lacking in evidence; he ought have known that rank hearsay and speculation would not get him very far on what I called the employment ground in Haines & Rader (No 5). The currency of the court is evidence.
Second, advancing a s 79A ground that his Tender Bundle was supressed was just mischievous (the Tender Bundle Ground). I repeat what was said in Haines & Rader (No 5) at [51]-[54]:
The husband’s affidavit suggests that it was his Tender Bundle that was supressed, and if it had not been, then it would have “contradicted evidence and submissions made by and on behalf of the wife”. I will repeat what he deposed to in his affidavit at [3]:
I am seeking that the Orders dated 21 December 2022 be set aside on the basis of a suppression of evidence leading to a miscarriage of justice in respect of the following:
(a) Documents in my tender bundle contradicted evidence and submissions made by and on behalf of the wife.
The husband deposed that his Tender Bundle was filed on 2 September 2022 (Husband’s affidavit filed 13 February 2023, paragraph 4). It was not. It was never filed.
Rather, it was accepted, very appropriately by the husband’s counsel, that emailing a tender bundle to a registry email address did not make the Tender Bundle evidence, much less evidence before me at trial. It was also accepted, again entirely appropriately, that there was no evidence before me that the wife had read or engaged with the husband’s proposed Tender Bundle. Again, appropriately, it was accepted that the wife had no duty to bring any material in the husband’s proposed Tender Bundle to the Court’s attention. This was not an ex parte application; it was an undefended hearing.
If the husband’s affidavit is to be read that it was his Tender Bundle that was supressed and had it not been, then the wife’s evidence would have been contradicted, then, I do not accept that. By virtue of the husband’s own choices, the Tender Bundle was simply not in evidence before me. A party cannot rely on their own non-disclosure to have orders set aside (by analogy I refer to Badawi and Badawi (2017) FLC 93-784; In the Marriage of Rohde and Rohde (1984) FLC 91-592; Lane).
I acknowledge his counsel took a different tack in oral submissions (that is, the wife was not truthful), nevertheless the husband’s affidavit remained that “Documents in my tender bundle contradicted evidence and submissions made by and on behalf of the wife” (Affidavit of Mr Rader filed 13 February 2023, paragraph 3). The wife was put to the expense of engaging with a wrong-headed and groundless claim by the husband about the status of his Tender Bundle.
Third, his non-compliance with both my substantive s 79 orders and orders to file material and submissions in relation to the s 79A / enforcement hearing is in wilful disregard of known facts – being dates for him to do specific things.
Fourth, that he put the wife to the test on her enforcement application but did not seek its dismissal, along with seeking incompetent orders add to elevating this matter to an exceptional one.
Fifth, the husband’s conduct of his s 79A application and response to the wife’s affidavit, including repeating of irrelevant material from previous affidavits (for example, his alleged health issues in late 2022) is the antithesis of the Court’s overarching principles, including at 1.4 of the Central Practice Direction that “[a]t all stages in the proceedings, parties must avoid filing evidence that is unnecessarily lengthy or only of limited relevance to the issues genuinely in dispute”.
Sixth, I consider the husband has been wholly unsuccessful when looking at the proceedings overall.
Seventh, it remains he brought a flawed application on flimsy evidence after the wife filed her enforcement application. It was, plainly, a strategy engaged in by the husband to try and delay the enforcement and a strategy for which the wife ought not pay.
I consider the quantum of the wife’s costs, as deposed to by her solicitor in his affidavits and in submissions, to be reasonable, proper, fair and proportionate. Mr Phair has carefully provided how he arrived at each sum sought. Further, the “Court is not obliged to, nor should it attempt, something akin to a taxation of costs undertaken by an assessor” (Rankin and Rankin (No 3) [2019] FamCAFC 133 at [23]).
Disposition
For all of the reasons given, I will therefore make an order that the husband pay the wife's costs in the unchallenged, but reasonable sums deposed to by her solicitor.
No one suggested a time frame for payment of costs. Pursuant to r 12.13(5) of the Rules I will order the costs be paid within 28 days of the date of this order. I do so because (a) a time frame is necessary to avoid further disputes between the parties (Bokin & Wild [2022] FedCFamC1A 209) and (b) 28 days is the timeframe in the rules referred to for filing costs application. It is simply consistent with that. In circumstances where no one proposed a time frame, I can only do the best I can.
I certify that the preceding seventy (70) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Brasch. Associate:
Dated: 6 April 2023
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