Killough & Garbiec
[2021] FedCFamC1F 129
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Killough & Garbiec [2021] FedCFamC1F 129
File number(s): SYC 1133 of 2019 Judgment of: MCGUIRE J Date of judgment: 15 October 2021 Catchwords: FAMILY LAW – COSTS – where father seeks an order that the mother pay his costs in relation to vacating the trial date – application opposed by the mother – order that the mother pay the father’s costs thrown away of and incidental to adjourning the trial date such costs to be agreed or assessed by a Judicial Registrar. Legislation: Family Law Act 1975 (Cth) s 117
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) Parts 12.08 and 12.17
Cases cited: Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Anor (2005) 33 Fam LR at 123
Penfold v Penfold (1980) FLC 90-800
Division: Division 1 First Instance Number of paragraphs: 63 Date of hearing: 6 October 2021 Counsel for the Applicant: Mr Ahmad Solicitor for the Applicant: Clinch Long Woodbridge Lawyers Counsel for the Respondent: Ms Eldershaw Counsel for the Respondent: Armstrong Legal Counsel for the Independent Children's Lawyer: Mr Fermanis Solicitor for the Independent Children's Lawyer: Phillip A Wilkins & Associates ORDERS
SYC 1133 of 2019 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR KILLOUGH
Applicant
AND: MS GARBIEC
Respondent
ORDER MADE BY:
MCGUIRE J
DATE OF ORDER:
15 OCTOBER 2021
THE COURT ORDERS THAT:
1.That the respondent mother pay the applicant father's, costs thrown away of and incidental to the listing of the matter on 6 October 2021 such to be agreed or placed before a Judicial Registrar for assessment pursuant to Part 12.8 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021.
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 the pseudonym of Killough & Garbiec has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
McGuire J
APPLICATION
There are substantive parenting proceedings between the parties in respect of their two children namely X born in 2016 (age 5 years) and Y (a.k.a. Y) born in 2018 (age 3 years).
The Application now before me is one by the father, Mr Killough, seeking costs thrown away of the vacating of a trial date of 6 October 2021 on the application of the mother, Ms Garbiec. Costs are sought in a quantum of $17,500 including costs of solicitors and counsel.
The Application is opposed.
The Court has the benefit of an independent children's (‘ICL’) who neither sought costs on the vacating and adjournment of the trial date nor sought to be heard in this application.
BACKGROUND
This matter came before me on 10 August 2021 in the call-over of matters awaiting trial in the Sydney list of the Family Court (as it then was). There was no appearance by or on behalf of the mother on that day. The Court was advised that the mother had not complied with the previous interim and interlocutory orders. Consequently, the matter was listed for trial at 9.00am on 6 October 2021 noting that consideration would be given to the matter proceeding to final hearing undefended the mother should she not to appear on that day and/or not comply with procedural orders.
I have before me an affidavit of Suzana Dimitrijevic who is a solicitor in the employ of the father's solicitors. She deposes, and I accept, that my orders were made available on the Court Portal on 19 August 2021 and on that day a copy was served on the mother at her last known email address.
Those orders provided inter-alia:
1.These proceedings be listed for hearing at the Family Court of Australia at Sydney before Justice McGuire at 9.00am on 6 October 2021.
…
3.The parties make file and serve any trial material upon which they intend to rely not later than 14 days prior to trial date.
4.That within 7 days prior to the trial date the solicitor (sic) for the parties each file and serve a case summary document …
…
6.THE COURT NOTES the non-attendance of respondent mother this day and non-participation in these proceedings for some months and should the mother not appear at the next listing on 6 October 2021 then consideration will be given to proceedings (sic) to be heard undefended on a final basis.
7.The solicitors for the father cause a copy of these orders to be served on the mother by email at her last known active address.
The mother has not yet filed a Response pursuant to the Rules. She has, however, sworn an affidavit on 1 October 2021 deposing inter-alia:
[31]On 19 August 2021, I received an email from [the father’s] solicitor enclosing the Court Orders made 10 August 2021. I then immediately checked my old email, …@gmail.com, and saw two emails from [the father’s] solicitor dated 10 August 2021. This was the first time I became aware of a Court event on 10 August 2021. Had I known of the 10 August 2021 Court event, I would have attended via the appropriate electronic means as I desperately wish to participate in the proceedings and be involved in my children's lives.
[32]On 15 September 2021, I approached Armstrong Legal to act for me in the proceedings. The firm indicated that before they could file a Notice of Address for Service and undertake work on my behalf, I would need to transfer funds into the firm's trust account and provide a costs agreement. I was also informed the hearing on 6 October 2021 would necessitate briefing counsel and that additional fees would need to be secured for counsel.
…
[34]On 27 September 2021, I was provided a Costs Agreement by Armstrong Legal. I accepted those terms and caused further funds to be deposited into their trust account.
On a reading of the documents, the Affidavit of the mother of 1 October 2021 cannot be seen as the trial affidavit contemplated by my orders of 10 August 2021.
The mother did file, albeit not until 5 October 2021 being the date prior to the listed hearing, an Application in the Case seeking inter-alia that the final hearing on 6 October 2021 at 9,00am be vacated.
Both parties are 36 years of age. The mother is a Country F citizen holding a Permanent Partner Visa which provides her permanent residency in Australia.
The parties commenced a relationship in 2014 and separated in November 2017.
The mother left Australia with X in early November 2017 with the implication being that she did so without the father's consent. She returned to Australia on or about 7 December 2017 moving herself and X to Region D.
During 2018 the parties negotiated informal arrangements for time for the children, Y being born in 2018, with the father. The children remained living primarily with the mother.
In February 2019 the mother unilaterally relocated the children from Australia. The father commenced parenting proceedings pursuant to the Hague Convention on Child Abduction in April 2019.
The mother was located with the children in Country E.
On 3 July 2019 the Country E Court made an order that the children be returned to Australia. That order was served on the mother on 2 September 2019. The father asserts that the mother moved herself and the children to Country F on or about 12 September 2019.
The father instituted further Hague Convention proceedings in December 2019 such filed in the Country F Courts. The mother was located in April 2020.
The father travelled to Country F for the hearing in August 2020 and spent time with the children for the first time since February 2019.
On 26 August 2020 the Country F Courts ordered the return of the children to Australia within seven days.
The mother appealed the decisions of both the Country E and Country F Courts.
The appeal to the Country F higher Court was heard on 30 November 2020 and the father asserts he was awarded 'full custody of the children until the final court orders were delivered’.
The mother's appeal to the Country F Court was dismissed on 15 December 2020 and the children ordered to return to Australia within seven days. The father returned to Australia with the children on 28 December 2020.
The father commenced these proceedings on 18 January 2021 with a directions hearing conducted on 20 January 2021.
Nolan Lawyers filed a Notice of Address for Service for the mother of 1 February 2021.
An interim hearing was conducted on 9 February 2021 by Registrar Hayward. The children were to remain living with the father with no time to the mother and the mother was ordered to submit to a psychiatric assessment.
Nolan Lawyers filed a Notice of Ceasing to Act on 22 March 2021.
In April and May 2021 the father attempted dialogue with the mother, but with the mother requesting that he not contact her again.
The matter was listed in the winter call-over for directions on 10 August 2021.
On 6 October 2021 I acceded to the mother's application for the trial date to be vacated. That order was made against the opposition of the father and the ICL. My short reasons were delivered Ex Tempore noting that the conflict often confronting courts where a party does not comply with procedural orders, but who then seeks an adjournment on the basis of the ‘the child's best interests’. The trial date was vacated and the adjournment granted on strict conditions as to compliance by the mother failing which I advised the mother that the matter would inevitably proceed to an undefended hearing.
The father's case – costs
The father seeks costs in a lump sum of $17,500 inclusive of counsel's fees. That quantum seems to be arrived at simply as a 'discount' on the evidence as to the father's solicitor – client costs thus far being $28,075.71, but perhaps not including counsel's fee for 6 October 2021 and further solicitor's fees anticipated at $1,804.
Counsel for the father argues that the mother did not comply with my orders of the 10 August 2021 having been put on notice as to those orders as long ago as 19 August 2021. He says that her Affidavit was sworn only on 1 October 2021 and that copies of the Application in a Case and Affidavit were not provided to his instructors until that day.
Counsel argues that the mother has not complied with orders of 9 February 2021 for her to undertake and provide a psychiatric assessment.
Counsel for the father argues generally that, consistent with the chronology set out above, the father has been put to substantial cost and expense because of the actions of the mother which will be argued to be contrary to the best interests of the children. He argues that the opposition to the Application in a Case to vacate the trial date was not without merit or force given the mother's conduct. He argued generally on the mother's application to vacate the trial date that the matter should proceed undefended with the onus on the mother then to bring an application presumably showing a change in circumstances, namely her attitude to these proceedings.
The thrust of the argument on behalf of the father was that he had been put to cost and expense unnecessarily in bringing the mother to the Court where she had not participated in these proceedings actively since February 2021 and had not complied with the orders of these Courts.
The mother's case – costs
Counsel for the mother argued that the general rule pursuant to s 117(1) of the Family Law Act 1975 (Cth) (‘the Act’) should apply in that each of the parties be responsible for his and her own legal costs. It was argued that there are no 'justifying circumstances' is pursuant to s 117(2).
Whilst not disputing that the mother was made aware of the orders of 10 August 2021 by 19 August 2021, counsel for the mother says that the father was put on notice of the Application to vacate the trial date on 21 September 2021, although agreeing that the Application was not filed until Friday 1 October 2021. Counsel argues that, given such notice, the father could have consented to the Application to vacate the trial date and not instructed counsel to prepare for the trial.
Secondly, counsel argues that the costs incurred by the father are not 'wasted' but indeed can be 'banked' in that the preparation for the eventual trial is now substantially completed and will simply need to be 'updated'.
Thirdly, counsel argues that the mother was, in fact, successful in her Application in a Case to have the trial date vacated and it follows that the father should not therefore have his costs.
CONSIDERATION
Rule 12.17 of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 provides:
12.17 Method of calculation of costs
(1) The court may order that a party is entitled to costs:
(a) of a specific amount; or
(b)as assessed on a particular basis (for example, party and party, solicitor and client or indemnity); or
(c)to be calculated in accordance with the method stated in the order; or
(d)for part of the proceeding, or part of an amount, assessed in accordance with Schedule 3.
(2)If costs are payable under the Family Law Act or these Rules, or the court orders that costs be paid and does not specify the method for their calculation, the costs are to be assessed on a party and party basis.
(3)In making an order under subrule (1), the court may consider the following:
(a)the importance, complexity or difficulty of the issues;
(b)the reasonableness of each party’s behaviour in the proceeding including by having regard to the matters set out in subrule 12.08(2);
(c)the rates ordinarily payable to lawyers in comparable proceedings;
(d)whether a lawyer’s conduct has been improper, unfair, unreasonable or disproportionate;
(e)the time properly spent on the proceeding, or in complying with pre‑action procedures;
(f)whether expenses (paid or payable) are fair, reasonable and proportionate.
Rule 12.08 under the heading legal costs to be fair, reasonable and proportionate provides:
12.08 Legal costs to be fair, reasonable and proportionate
(1) The legal costs incurred in a proceeding must be:
(a) fairly, reasonably and proportionately incurred; and
(b) fair, reasonable and proportionate in amount;
in the circumstances of the proceeding.
(2)In considering whether a party’s legal costs have been fairly, reasonably and proportionately incurred, regard must be had to all relevant matters including, but not limited to, whether a lawyer representing the party, a lawyer representing any other party, or any self‑represented litigant has:
(a)complied with all relevant rules and orders of the court, including requirements that documents be filed or provided to other parties by a given date; and
(b)acted reasonably in raising, pursuing or contesting a particular allegation or issue; and
(c)made reasonable efforts, subject to the client’s instructions, to resolve the dispute through negotiation, mediation or arbitration; and
(d)made reasonable efforts to narrow the issues in dispute; and
(e)filed no more interlocutory applications than are reasonably necessary in the circumstances of the proceeding; and
(f)filed no more affidavits or other documents than are reasonably necessary in the circumstances of the proceeding.
(3)In considering whether a party’s legal costs are fair, reasonable and proportionate in amount, regard must be had to all relevant matters including, but not limited to, whether the costs reasonably reflect:
(a)the level of skill, experience, specialisation and seniority of the lawyers concerned; and
(b)the level of complexity, novelty or difficulty of the issues involved, and the extent to which the proceeding involved a matter of public interest; and
(c)the labour and responsibility involved; and
(d)the circumstances in which lawyers acted, including any or all of the following:
(i)the urgency of the work;
(ii)the time spent on the work;
(iii)the time when work was required to be carried out;
(iv)the place where work was required to be carried out;
(v)the number and importance of any documents involved; and
(e)the quality of the work done; and
(f)the retainer and the instructions (express or implied) given in the matter.
(4)In considering whether a party’s legal costs have been fairly, reasonably and proportionately incurred under subrule (2), or are fair, reasonable and proportionate in amount under subrule (3), regard must also be had to any applicable State or Territory law in relation to the regulation of legal practitioners in that State or Territory.
(5)In relation to an application for costs by one party against another, a cancellation fee levied by a barrister or solicitor advocate is taken not to be reasonable.
Matters of costs are generally provided for in s 117 of the Act where as a general rule at subsection (1) each party to proceedings under this Act shall bear his or her own costs.
That general rule, however, is subject to a discretion enlivened in the Court to make an award of costs to one or other of the parties if there are 'circumstances that justify it doing so'. It is well-established that the term 'justifying circumstances' is not to be read as synonymous with 'extraordinary circumstances'. In considering whether there are justifying circumstances and the order to be made, if any, the Court is mandated to consider the various factors under subsection (2A). The process for the Court is to consider all relevant matters at subsection (2A) and then weigh and balance the evidence towards a determination as to whether the overall circumstances justify the making of an order and award for costs with, therefore, it not being necessary for an applicant to successfully meet each of the factors at subsection (2A) nor is there anything to prevent any one factor being the sole or dominant foundation for an award to the costs.[1]
[1] Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Anor (2005) 33 Fam LR at 123.
Section 117(2A)(a) the financial circumstances of each of the parties to the proceedings
In circumstances where this is an oral application, it is understandable that the neither party here provides detailed evidence as to their financial circumstances. The Court is not required to enter into a precise or a minute audit of the financial circumstances and, in any event, impecuniosity is not a bar to the making of an award for costs.
The father's counsel describes the father as a man of 'modest means'. It is fair to assume that he has been required to spend considerable amounts in respect of broader family law proceedings including a number of the applications overseas under the Hague Convention. The children live with him and he therefore has the primary responsibility for their financial support where I am told that he has obtained an assessment for child support from the mother but none has yet been paid.
There is also evidence that the mother has been required to outlay a considerable sum to her current lawyers for these anticipated substantive parenting proceedings including the obtaining of expert reports. She describes herself in her Affidavit at [2] as self-employed and also engaging in stock market trading. The mother has sold her house in Country F and in August 2021 the net proceeds of sale of $125,340 AUD were received.
I am generally satisfied that neither party is of any great wealth and have actual and potential heavy financial commitment to these proceedings. I am satisfied, generally, however, that the mother has the capacity to meet the costs order sought by the father noting the recent sale of a house.
Section 117(2A)(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 evidence that either party is legally aided.
Section 117(2A)(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
This consideration is at the crux of the father's application. He has complied with the Court Orders including the orders for the listing of the matter for trial on 6 October 2021. The mother has not complied with those orders. She has not complied with previous orders including for the provision of a psychiatric assessment. She has not participated in court events including the winter call-over of 10 August 2021. It may be that the mother has not yet formally filed a Response in proper form despite these proceedings being on foot since January 2021 and the mother being back in Australia and certainly appraised of these proceedings since early March 2021.
The mother now files an Application in a Case but arguably not validated by her first filing a Response in the substantive proceedings.
The mother did not attend the winter call-over. The matter was, in accordance with the policy of this Court, then properly listed for a trial and in anticipation of being undefended and hence causing the father and his legal representatives to prepare for that event.
Section 117(2A)(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court
The mother has not complied with previous orders of these Courts including for the provision of a psychiatric assessment. She did not strictly comply with the orders of 10 August 2021 being procedural orders towards a trial on 6 October 2021.
Section 117(2A)(e) whether any party to the proceedings has been wholly unsuccessful in the proceedings
The mother argues that she was successful in her application for the trial date to be vacated and the matter adjourned. This submission must be seen within perspective and context where it was a discrete application which must either succeed or fail without grey areas. She did, however, succeed in an application which was opposed on the day and where notice had previously been given to the father and that the Application would be brought and where the mother argues, with some merit, that the father's legal representatives may have given him advice to consent to that Application. As against this, however, is the fact that the mother had not complied with the procedural orders towards the trial and prima facie the father therefore had the benefit of a court order noting a potential undefended hearing. In my view, his opposition to the mother’s application was not unmeritorious.
Section 117(2A)(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
This is not a relevant consideration in these proceedings.
Section 117(2A)(g) such other matters as the court considers relevant
The other issue that is relevant to my consideration here, but perhaps more as to quantum if the Court is inclined to exercise its discretion in favour of making an order for costs, is the submission of counsel for the mother that the work conducted by the father’s solicitors and counsel towards the trial listed the on 6 October 2021 but now vacated is not so much 'wasted' as it is 'banked'. It is true, on the assumption that the trial will proceed at some stage, that (subject to refreshing and perhaps updated evidence) the preparation has been undertaken. While this is a valid argument, it is not as simple as saying that the all of the work 'is banked'. There will now inevitably be a lengthy delay to having this matter proceed to trial. Counsel and solicitors will put their minds to other matters and further evidence will inevitably come to light in this matter. Further and it is arguable, in any event, that it was appropriate and reasonable for counsel for the father to attended to a high degree of preparation and then to allocate the day of 6 October 2021 to this matter where his instructions were to oppose the vacating of the hearing date hence denying him accepting a brief in any other matter.
Section 117 confers a broad discretion on the Court in in respect of the award of costs as the High Court observed in Penfold v Penfold:[2]
It is an accurate description of s. 117 (1) to say that it expresses a general rule, provided that it is firmly understood that the subsection is not paramount to s. 117 (2). As subsec. (1) is expressed to be subject to subsec. (2) the former must yield whenever a judge finds in a particular case that there are circumstances justifying the making of an order for costs.
Subsection (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order. Beyond this there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs. …
[2] (1980) FLC 90 –800 at pages 75,053–75,054.
Despite the mother being successful in her application for vacating the trial date on 6 October 2021, I am satisfied that there are circumstances justifying an award of costs to the father. The substantive application was listed for trial due to the non-attendance and non-participation of the mother. Further, the mother did not comply with the procedural orders of 10 August 2021 and in anticipation of the trial of 6 October 2021. Indeed, she has not yet complied with those orders. She did file an Application in a Case seeking a vacation of the trial date such being presumptuous in that she still has not filed an Affidavit in the substantive proceedings. These documents were not filed until 1 October 2021 being more than a week outside of the time permitted by my orders of 10 August 2021 and despite the mother been put on notice as to my orders and the potential trial as long ago as 19 August 2021 at the latest. It follows that the father's opposition to the Application could not be criticised and was not unmeritorious in those circumstances.
I am satisfied, therefore, that the father has been put to cost and expense in reasonably having his legal representatives prepare the matter for trial on 6 October 2021 and by reason of the conduct of the mother such being consistent generally with her historical conduct which in turn gives further merit to the father's opposition to the application to vacate the trial date.
I am satisfied that it was reasonable for the father’s solicitors to instruct counsel to attend at court for the day of 6 October 2021 in anticipation of the trial and so as to oppose the mother’s application which was effectively for an adjournment. That the mother’s application succeeded is more by reason of an indulgence given by the Court to her with emphasis on the children's best interests rather than any lack of merit or reasonableness in the father's opposition.
Whilst I find some merit in the submissions of counsel for the mother that the preparation by the father's legal representatives and counsel is not 'wasted', I am not satisfied that all of such preparation can be 'banked' for the reasons set out above.
I therefore determine to exercise my discretion in making an order for costs in favour of the father such costs being thrown away in respect of the reasonable preparation and attendance by his solicitor and counsel for all applications listed before this Court on 6 October 2021. Unfortunately, I must accept the submission of counsel for the mother that there is some confusion or inconsistency in respect of the quantum of costs sought. Whilst counsel says that the father is now asking for the costs in an in globo amount of $17,500, there is no breakdown of that amount. The affidavit of Clayton Long, solicitor, of 1 October 2021 suggests at [8] that the father's costs 'calculated on an indemnity basis' total $21,604. The letter of 21 September 2021 from Mr Long to the mother's solicitor states:
In the event that the Court decides against us, and grants an adjournment, you are on notice that we will tender this letter and that we will seek orders that:
1.The Mother pay costs thrown away in preparation for undefended hearing on 6 October, being counsel at $6,000, solicitors at $5,500, total of $11,500.
My enquiry of Mr Ahmad of counsel for the father suggested that his counsel rate was $9,100 being presumably for the fee on brief of preparation and one day.
As such, I do not feel confident in the ‘assessing' the quantum costs and intend to refer the matter to a Judicial Registrar pursuant to Part 12.8 of the Rules for assessment but with reference to these Reasons.
I certify that the preceding sixty-three (63) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice McGuire. Associate:
Dated: 15 October 2021
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