Kernot and Matson - [2008] FMCAfam 819

FEDERAL MAGISTRATES COURT OF AUSTRALIA

KERNOT & MATSON

[2008] FMCAfam 819

FAMILY LAW – Practice & procedure – applications for costs certificates – matter transferred to Family Court on first day of hearing – meaning of discontinuance – applications dismissed.

Family Law Act 1975
Federal Proceedings (Costs) Act 1981

Coulson v Gosford Meats Pty Ltd (1985) 7 FCR 106
Culkoff & Culkoff [2001] FamCA 792
Furnari v Furnari [1998] FamCA 171
Lindner & Lindner (1985) FLC 91-638
Marriage of Redshaw (1989) 13 FamLR 495
Morris v Maroudas (1986) 66 ALR 699
W & S[2005] FamCA 568

Applicant:

MR KERNOT

Respondent:

MS MATSON

File Number:

SYC 1958 of 2007

Judgment of:

Sexton FM

Hearing date:

21 July 2008

Date of Last Submission:

21 July 2008

Delivered at:

Sydney

Delivered on:

22 July 2008

REPRESENTATION

Counsel for the Applicant:

Mr G. Richardson

Solicitors for the Applicant:

York Family Law

Counsel for the Respondent:

Mr J. Levy

Solicitors for the Respondent:

Thurlow Fisher Lawyers

Counsel for the Independent Children’s Lawyer

Ms E. Boyle

Solicitor for the Independent Children’s Lawyer

Abrams Turner Whelan Family Lawyers

ORDERS

The applications for costs certificates under section 10(3) of the Federal Proceedings (Costs) Act 1981 be dismissed.

IT IS NOTED that publication of this judgment under the pseudonym Kernot & Matson is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
SYDNEY

SYC 1958 of 07

MR KERNOT

Applicant

And

MS MATSON

Respondent

REASONS FOR JUDGMENT

Ex Tempore

Introduction

I give these reasons orally.
This matter concerns applications by the applicant father, the respondent mother and the Independent Children's Lawyer for cost certificates pursuant to the Federal Proceedings (Costs) Act 1981.
The father's Application in the substantive proceedings was listed before me for final hearing for three days, being Monday 21 July 2008, Thursday 24 July 2008 and Friday 25 July 2008. Having been listed for hearing at 10.00a.m. on 21 July 2008, the matter was called at approximately 10.30a.m. as a result of other matters listed before me at 9.30a.m.
The father's legal representative had provided the Court with a 42 page case outline on Friday 18 July 2008 at 2.00p.m. Eighteen affidavits had been filed on behalf of the father to be relied on at hearing. I asked the father's counsel whether the matter could be finalised in the three days allocated. The father's counsel, Mr Richardson, advised the Court the matter was unlikely to be contained to three days. The mother's counsel, Mr Levy, was unable to give the Court an assurance that the matter could be contained to the three days. Ms Boyle, counsel for the Independent Children's Lawyer, raised the possibility of the parenting aspect of the matter being heard separately from the other aspects of the matter, but it became unnecessary to consider that proposal.
Given the likely delay in completing the matter if it was adjourned part heard, the matter was stood down to enable the Court to make inquiries as to available dates in the Family Court in the Sydney Registry for a four day hearing. Those inquiries took some time. As a result of those inquiries, the proceedings were transferred to the Family Court in the Sydney Registry for hearing before his Honour Justice Watts on Monday 28 July 2008 for four consecutive days.
The mother's counsel then made an application for the mother's costs of 21 July 2008 to be reserved. The father's counsel opposed that application and made the application for a costs certificate pursuant to s.10 of the Federal Proceedings (Costs) Act 1981. The mother's counsel then sought a costs certificate for the mother, and did not pursue his application to have the mother's costs for the day reserved. The Independent Children's Lawyer's counsel also sought a costs certificate for the Independent Children's Lawyer.
Each party's counsel made brief submissions. The father's counsel submits that the circumstances come within the provisions of s.10(1) and 10(3). Counsel submits that through no fault of the father, the matter did not proceed on the dates it was listed for hearing and has been transferred to the Family Court for hearing on other dates. Counsel submits, “the hearing listed to commence and that did commence on the announcement of appearances this morning cannot take place and is being moved to the Family Court.” Counsel further submits that this was a, “suitable if not classic case for which the section applies.”
The mother's counsel submits that if any fault can be attributed to a party in relation to the adjournment of the matter, it must be attributed to the father, not the mother. Counsel submits the mother was relying on only one affidavit of herself, one supporting affidavit and a financial statement. The mother's counsel then submitted that if a certificate were granted to the father, a certificate should also be granted to the mother. Counsel submitted this was a case to which s.10(3) of the Act applies.
The Independent Children's Lawyer's counsel submitted that the Independent Children's Lawyer played no part in extending the time needed for hearing and also seeks a costs certificate.

Relevant Law

Section 10 of the Federal Proceedings (Costs) Act 1981 applies to the Federal Magistrates Court. [1]
[1] Section 10(1)
Section 10(3) of the Federal Proceedings (Costs) Act 1981 provides that:
Subject to this Act, where:
(a) the hearing of any proceedings in a court to which this section applies is discontinued and a new hearing is ordered; and
(b) the discontinuance and new hearing are not attributable to the neglect, default or improper act of any party to the proceedings;
the court may, on the application of a party to the proceedings, grant to that party a costs certificate in respect of the proceedings.
Section 10(4) provides that:
The certificate that may be granted under subsection (2) or (3) by a court to a party to proceedings that have been rendered abortive or the hearing of which has been discontinued, as the case may be, is a certificate stating that, in the opinion of the court, it would be appropriate for the Attorney‑General to authorize a payment under this Act to that party in respect of such part as the Attorney‑General considers appropriate of any costs incurred by that party in relation to those proceedings.
This matter constitutes “proceedings in a court” as referred to in s.10(3)(a).
Although the circumstances are not precisely the same, the question raised by these applications is the question which arose in the 2001 decision of her Honour Justice Moore in Culkoff & Culkoff [2] when a matter was not able to be heard because of the unavailability of a Judicial Officer to hear the case Her Honour said: [3]
The question the applications do raise, however, is whether these provisions apply to proceedings adjourned in the circumstances I have outlined, as opposed to those that are under way and then ‘rendered abortive’ for one of the reasons stipulated in sub-section (2) or ‘discontinued’ and a ‘new hearing’ ordered as provided in sub-section (3).
[2] [2001] FamCA 792
[3] At paragraph 7
Her Honour Justice Moore examined the reported and unreported decisions of the Family Court and the Federal Court on the issue, and said there was, “a divergence of views about the interpretation of s.10 and the ambit of its application.” [4]
[4] At paragraph 8
I refer now to a summary of these decisions set out in her Honour’s Reasons at paragraph 8 and following. Her Honour referred to a number of decisions including the decision of Purdy J in Lindner & Lindner[5] and the decision of Mullane J in the Marriage of Redshaw[6].
[5] (1985) FLC 91-638
[6] (1989) 13 FamLR 495
In Lindner & Lindner, two matters had been listed for hearing and one could not be heard on the date it was listed. Priority was given to the other matter. Purdy J concluded that a case had started to an extent necessary for it to be “discontinued” (in the terms contemplated by s.10(3)) when “counsel have announced their appearance on the day notified to the parties unequivocally as a date for hearing.” [7] Leave in that case was given to the parties to obtain a new hearing date and his Honour issued certificates to each of the parties.
[7] At 77,601
Mullane J took a different view in the Marriage of Redshaw, another case where the matter was not heard because a judge had become ill and there was no other judge available to hear the case. His Honour said that sub-section (2) imported a requirement that the hearing must have commenced, so the application should be refused under that sub-section. In relation to sub-section (3), his Honour distinguished the decision in Lindner and concluded that the hearing had not commenced and therefore there could be no discontinuance of it.
Her Honour Justice Moore referred to two decisions of the Federal Court considered by Mullane J in the Marriage of Redshaw. In one, the case of Coulson v Gosford Meats Pty Ltd[8], Gray J held that although the hearing in that case had not begun, it had been fixed for hearing and did not proceed. Gray J decided that was sufficient to satisfy sub-section (3). That decision was followed by Higgins J in Re Palmdale Insurance Ltd [9].
[8] (1985) 7 FCR 106
[9] (1994) 122 ACTR 33
In the case of Morris v Maroudas[10], however, Muirhead J held in relation to sub-section (3) that an adjournment was not a discontinuance of a hearing. The hearing had not commenced, nor was a “new hearing” ordered as a hearing had neither been conducted nor initiated. The hearing, his Honour said, was simply postponed to a later date. His Honour said at 701 that sub-sections (2) and (3):
…seeks to grant relief to litigants whose liability for costs is increased by reason of the fact that a hearing on foot is aborted by circumstances not contributed to by fault or neglect of any party to the proceedings.
[10] (1986) 66 ALR 699 at 700
His Honour said it may, for instance, be referable to cases where the sickness or death of counsel intervenes, “under circumstances which require a discontinuance of the hearing which is under way at the time.” [11] His Honour said “the word “discontinuance” has a well established meaning. It envisages the cessation of something that was on foot.”
[11] At 701
Her Honour Justice Moore agreed with this interpretation. Her Honour held [12] that, “to be ‘discontinued’ the hearing would have to have commenced.” In Culkoff, her Honour said the hearing had not begun, so s.10(3) did not apply. The matter was simply adjourned without hearing. Her Honour did not consider whether in the exercise of her discretion, therefore, the certificate should be granted because in her view the application failed at the first step.
[12] At paragraph 18
There is other authority which supports this interpretation[13]. In the matter of W & S [2005] FamCA 568, a decision of Guest J, his Honour referred to Furnari v Furnari [1998] FamCA 171, where the Full Court, in the course of their judgment expressed the view that s.10(3) only applied [14] “where a matter begins but the hearing is aborted due to matters beyond a party’s control.” His Honour Justice Guest said [15] the word:
“Discontinuance”… conveys something having “commenced and then ceasing prior to its conclusion”.
[13] Foody v Horewood & Ors. (2000) FCA 37
[14] At paragraph 12
[15] In W & S at paragraph 26

Determination

The circumstances in the present case were these. The matter was listed for hearing at 10.00a.m. on 21 July, yesterday. The matter was called at approximately 10.30a.m. and counsel announced their appearances. The question of the time required for hearing was raised. When I was told that it would be unlikely for the matter to be contained within the time allocated, I said I would not start the case unless those at the Bar table could assure me that it could be contained within the allocated time, perhaps with a trial plan, as it appeared to be more complex than originally anticipated and it would cause difficulties to have the matter part heard.
The father's counsel then advised that he intended to raise four preliminary issues which the Court would need to address before the hearing proper commenced, including an application to disqualify me from hearing the matter. Counsel estimated these four preliminary issues would take approximately half a day from the time allocated.
Before the hearing of the application for my disqualification was started, which would have had to have been the first application heard and determined in the four preliminary applications the father's counsel foreshadowed, the proceedings were transferred to the Family Court as dates were available to hear the matter over four consecutive days as early as next week.
The hearing was not “running” and then aborted for one of the reasons set out in sub-section (2) nor was the hearing discontinued as provided in sub-section (3). The proceedings in my view did not start. I am therefore satisfied the section does not apply. It is therefore not necessarily in the exercise of my discretion to decide whether the certificates should be granted. The applications will be dismissed.

I certify that the preceding twenty-seven (27) paragraphs are a true copy of the reasons for judgment of Sexton FM

Associate: Skye Owen

Date: 22 July 2008