Kelso and Aldrin (No.2)

[2017] FCCA 3215

FEDERAL CIRCUIT COURT OF AUSTRALIA

KELSO & ALDRIN (No.2) [2017] FCCA 3215

Catchwords:
FAMILY LAW – Costs – application for indemnity costs after successful enforcement application – husband’s attempts to set aside orders misconceived – wife entitled to enforce orders – wife’s costs increased because of husband’s actions – indemnity costs justified.

Legislation:

Family Law Act 1975, ss.117(1), 117(2A)

Federal Circuit Court Rules2001, Part 21

Cases cited:

Kelso & Aldrin [2017] FCCA 2219

Prantage & Prantage [2013] FamCAFC 105
Calderbank v Calderbank [1975] 3 All ER 333

Applicant: MR KELSO

Respondent: MS ALDRIN

File Number: MLC 6535 of 2014

Judgment of: Judge Harland

Hearing date: 4 September 2017

Date of Last Submission: 2 October 2017

Delivered at: Melbourne

Delivered on: 19 December 2017

REPRESENTATION

Solicitors for the Applicant: Self-represented

Counsel for the Respondent: Ms Brooks

Solicitors for the Respondent: Maharaj Lawyers

ORDERS

1. That the husband pay the wife’s costs in the sum of $22,022.71.

2. That the wife’s indemnity costs be paid to the wife from the sale proceeds of the default sale of the property at Property A, prior to any balance being distributed to the husband pursuant to paragraph 4(a)(iv) of the orders made 30 March 2017.

IT IS NOTED that publication of this judgment under the pseudonym Kelso & Aldrin (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 6535 of 2014

MR KELSO

Applicant

And

MS ALDRIN

Respondent

REASONS FOR JUDGMENT

1. The wife seeks an order for costs in her favour on an indemnity basis, incurred in relation to the husband’s Initiating Application and amended Initiating Application filed on 14 August 2017, and her costs in enforcing the consent orders, resolving the property issues between them, which the parties entered into on 30 March 2017. The circumstances of the amended application are set out in my first judgment Kelso & Aldrin [2017] FCCA 2219. Those reasons should be read with these reasons for background.

2. Upon the conclusion of that hearing, I made directions for the filing of written submissions with respect to costs. The wife was to provide written submissions on or before 11 September 2017 and the husband’s response to submissions on or before 25 September 2017.

3. The wife’s solicitors emailed my Associate on 12 September 2017 advising of difficulties with respect to filing their submissions on the Commonwealth Courts Portal due to a file corruption. They advised they would attend the Melbourne Registry that day to file the document in person but also attached an electronic copy to their email.

4. A further email from the wife’s solicitors was received on 15 September 2017. They reiterated that due to technical difficulties they attended the Melbourne Registry to file the submissions and it was recommended that they inform the husband of the issue. The solicitor for the wife forwarded an unsealed copy of the submissions to the husband by express post that day.

5. The husband filed submissions for costs on 15 September 2017. Given these submissions were not responsive to the wife’s submissions; I extended the due date for the husband to file submissions to 2 October 2017 to allow the husband further time to respond. The husband filed these responding submissions on 2 October 2017. Most of those submissions are highly emotive and do not address the substantive issues I must determine.

6. The husband’s second set of submissions reveal the same misapprehensions about his obligations as the first.

7. It is clear that the husband continues to feel aggrieved and believes that the wife has acted unreasonably and he has not. Unsurprisingly, given the fact he is unrepresented, he does not engage with the legal principles.

8. I accept the wife’s explanation for the slight delay in filing submissions. It would be unjust to deny her application on the basis of technical difficulties in lodging the submissions. There is no prejudice to the husband as he has been given a further opportunity to file submissions responding to the substantive issues.

9. The wife’s written submissions accurately set out the applicable case law and sections of the Family Law Act1975 (Cth) (“Family Law Act”). I will not reproduce them here.

10. To make a costs order at all is a departure from the ordinary rule. Schedule 1 of the Federal Circuit Court Rules2001 ((“FCC Rules”) sets out a scale of costs to be applied in family law proceedings and in general Federal Law proceedings. It is an event based costs scale. Part 21 of the FCC Rules deals with costs and disbursements. If the court decides that it is appropriate to order costs then in usual cases the scale of costs should apply. It is designed to avoid parties having to go through the expense and delay of having bills of costs taxed. 

11. The amount the wife seeks on an indemnity basis is $22,022.71.  When considering whether or not to make an indemnity costs order it is necessary to know what the departure is from the scale.[1] The wife annexes the costs agreement she entered into with her solicitor, together with invoices and the costs agreement and invoice of the barrister she engaged. I am satisfied that the wife has provided the necessary evidence to support her claim for $22,022.71. Those costs relate to enforcing the orders made on 30 March 2017 and responding to the husband’s application to set aside the orders.

    [1] Prantage & Prantage [2013] FamCAFC 105.

12. Section 117(1) of the Family Law Act provides that each party to proceedings shall bear their own costs. However, in order for the Court to make a costs order in favour of the wife, there must be justifying circumstances as set out in s.117(2A) of the Family Law Act:

    (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.

Financial circumstances of each of the parties to the proceedings

1. The wife submits that the husband has received the benefit of occupying the properties. Furthermore, she has not received the benefit of the $260,000, which the husband was to pay to the wife by 29 June 2017, pursuant to the orders made by consent on 30 March 2017.

Whether any party to the proceedings is in receipt of assistance by way of legal aid

1. I am not informed that either party is in receipt of legal aid.

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

1. The wife submits that the husband received correspondence from the wife on 7 May 2017 with respect to non-compliance with orders. The wife’s lawyer sent further correspondence.

2. In the letter dated 4 August 2017 the husband was put on notice that the wife would take steps to enforce the orders. She also put him on notice of the defects in his initiating application. He was put on notice that if he did not withdraw his application and comply with the orders made 30 March 2017 that she would seek an order that the husband pay her costs on an indemnity basis.

3. The wife submits that the husband filed a further amended initiating application and further affidavit material. Ultimately, increasing the wife’s costs.

4. The husband complains that the wife was unreasonable and complains that she has acted in such a way so she can receive interest on the outstanding sum. His submissions completely miss the point. As stated in my first judgment, the wife was entitled to require compliance with the orders to which both parties consented.  The orders are clear and unambiguous.

5. The husband’s application and initiating application were misconceived. Quite properly the wife pointed out the problems to the husband and tried to mitigate her costs. The husband had an opportunity to seek legal advice. The wife took reasonable actions to seek compliance with the orders made 30 March 2017 as she was entitled to do.

Whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;

1. These proceedings related entirely to the implementation to enforce the consent orders made on 30 March 2017. The husband’s application and amended application which sought to vary the orders were entirely misconceived.

2. The wife had to take action to enforce the orders due to the husband’s refusal to comply. The wife’s costs increased because of the husband’s application and amended application.  This resulted in the wife having to respond to those applications and the Registrar, understandably, refusing to sign the documents in chambers.

3. I accept the wife’s submissions that the orders made on 30 March 2017 were self-executing and clear. It was due to the husband’s refusal to comply with the orders which necessitated the further proceedings. The husband’s Initiating Application and Amended Application were misconceived and without merit. The wife was put to further expense in responding to them.

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

1. The husband’s application has been wholly unsuccessful.

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

1. The wife refers to her letter of 4 August 2017 as being an offer to the husband. Certainly it put the husband on notice of the difficulties he faced and invited him to withdraw his application. It is not an offer of settlement in the Calderbank sense.[2]

   [2] See Calderbank v Calderbank [1975] 3 All ER 333.

Such other matters as the court considers relevant

1. The fact that this is the second set of proceedings is significant. I am comfortably satisfied that the circumstances of the case justify an order for costs. I am also satisfied that there are exceptional circumstances justifying indemnity costs. When parties enter into consent orders which are approved by the court they are entitled to receive the benefit of those orders within the time frame provided by those orders.

2. The wife attempted to mitigate her costs by corresponding with the husband before approaching the Registrar to sign documents on the husband’s behalf pursuant to order 7 of the 30 March 2017 consent orders. She incurred significant additional costs because of the need to respond to the husband’s initiating application and his initiating application, both of which were completely misconceived. I also accept the wife’s submissions about the nature and tone of the husband’s responses to her lawyer’s attempts to resolve the issues. Extracts are annexed to wife’s submissions. I accept that the wife incurred costs in having to respond to this. If the husband had availed himself of legal advice much of this could have been avoided.

3. Considering all of the circumstances of this case I am satisfied that the husband should pay the wife’s costs on an indemnity basis.

4. In her written submissions the wife seeks that her costs be deducted from the proceeds of sale. I will make the order she seeks.

I certify that the preceding twenty-eight (28) paragraphs are a true copy of the reasons for judgment of Judge Harland

Date:  19 December 2017