Houston and Houston & Anor - [2014] FamCA 219

FAMILY COURT OF AUSTRALIA

HOUSTON & HOUSTON AND ANOR

[2014] FamCA 219

FAMILY LAW – COSTS – Application by the wife for costs against the husband – Offer of settlement – Order made for husband to pay wife’s costs on a party/party basis

FAMILY LAW – COSTS – Application by the Second Respondent for costs against the husband – Husband joined Second Respondent in respect of an equitable claim and maintained claim against Second Respondent until final hearing – Order made for husband to pay Second Respondent’s costs on a party/party basis from date husband became aware the claim was futile

FAMILY LAW – COSTS – Application by the husband for costs against both the wife and the Second Respondent – Application dismissed – Husband to pay own costs pursuant to Section 117(1) of the Family Law Act 1975 (Cth)

Family Law Act 1975 (Cth) ss 117(2), (2A)
Family Law Rules 2004 (Cth) rr 19.18, 19.50

Browne and Green (2002) FLC 93-115
Colgate-Palmolive Company and Colgate-Palmolive Pty Limited v Cussons Pty Limited [1993] FCA 536
D & D (Costs) (No. 2) [2010] FamCAFC 64
Fennessy & Gregorian [2009] FamCAFC 44
Limousin & Limousin [2007] FamCAFC 1178
PBF as Child Representative for AF (Legal Aid Commissioner of Tasmania) & TRF &
LKL (2005) 33 Fam LR 123

Penfold v Penfold (1980) 144 CLR 311

Robinson and Higginbotham (1991) FLC 92-209

Yunghanns & Ors & Yunghanns & Ors & Yunghanns [2000] FamCA 681

APPLICANT:

Ms Houston

FIRST RESPONDENT:

Mr Houston

SECOND RESPONDENT:

Ms Mills

FILE NUMBER:

PAC

2217

2013

DATE DELIVERED:

4 April 2014 in chambers

PLACE DELIVERED:

Parramatta

PLACE HEARD:

Parramatta

JUDGMENT OF:

Foster J

HEARING DATE:

10 March 2014

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Ms De Vere

SOLICITOR FOR THE APPLICANT:

Smythe Wozniak Solicitors

THE FIRST RESPONDENT:	Self-represented Litigant
COUNSEL FOR THE 2ND RESPONDENT:	Mr Sansom

SOLICITOR FOR THE 2ND RESPONDENT:

McPhee Kelshaw

Orders

That the husband pay the wife’s costs from 5 February 2014 on a party/party basis as agreed within one (1) month from this date or, in default of agreement, as assessed.
That the husband pay the Second Respondent’s costs from 8 November 2013 on a party/party basis as agreed within one (1) month from this date or, in default of agreement, as assessed.
That the husband’s application for costs be dismissed.
The Court certifies for counsel pursuant to Rule 19.50 of the Family Law Rules 2004 (Cth).

IT IS NOTED that publication of this judgment by this Court under the pseudonym Houston & Houston and Anor has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT PARRAMATTA

FILE NUMBER: PAC 2217 of 2013

Ms Houston

Applicant

And

Mr Houston
First Respondent

And

Ms Mills

Second Respondent

REASONS FOR JUDGMENT

Notwithstanding that the parties to these proceedings resolved financial issues between them by reason of consent Orders made on 10 March 2014, they have been unable to resolve the question of costs.

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2014] FamCA 219
Decision Date

CaseChat Overview and Summary

The Family Court of Australia considered competing applications for costs between Ms Houston (the wife), Mr Houston (the husband), and Ms Mills (the Second Respondent, the wife's mother). The dispute arose from the husband and wife constructing a cottage and other improvements on the Second Respondent's property, financed by a mortgage secured against that property. The husband had joined the Second Respondent to the proceedings, seeking a declaration of an equitable interest in the property for himself and the wife, which was ultimately found to be less than the secured liability.

The court was required to determine whether to award costs against any party, and on what basis, given that the financial issues between the husband and wife had been resolved by consent orders. Specifically, the court had to consider the wife's application for costs against the husband, the Second Respondent's application for costs against the husband, and the husband's application for costs against both the wife and the Second Respondent. The court's determination was guided by section 117 of the *Family Law Act 1975* (Cth) and relevant Rules of Court, which outline the general principle that parties bear their own costs but grant the court discretion to make orders for costs in justifiable circumstances.

The court applied the principles governing costs orders under the *Family Law Act 1975* (Cth), including the factors listed in section 117(2A), such as the financial circumstances of the parties, their conduct in the proceedings, and the reasonableness of their behaviour. The court noted that while the ordinary rule is for costs to be awarded on a party/party basis, it has the discretion to order indemnity costs in circumstances warranting a departure from the usual course, such as where proceedings were commenced or continued for an ulterior motive or involved undue prolongation on groundless contentions. The court considered the husband's conduct in joining the Second Respondent and maintaining the claim against her until the final hearing, despite evidence suggesting the claim was futile.

The court ordered that the husband pay the wife's costs on a party/party basis from 5 February 2014. The husband was also ordered to pay the Second Respondent's costs on a party/party basis from 8 November 2013, the date from which the court considered the husband became aware his claim against her was futile. The husband's own application for costs against both the wife and the Second Respondent was dismissed, and he was ordered to bear his own costs. The court also certified for counsel pursuant to Rule 19.50 of the *Family Law Rules 2004* (Cth).

Orders