Koustous & Koustous (No 2)

[2010] FamCA 574

FAMILY COURT OF AUSTRALIA

KOUSTOUS & KOUSTOUS (NO. 2) [2010] FamCA 574

FAMILY LAW – COSTS

Family Law Act 1975 (Cth)

APPLICANT: Ms Koustous

RESPONDENT: Mr Koustous

FILE NUMBER: MLC 9957 of 2009

DATE DELIVERED: 29 June 2010

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Cronin J

HEARING DATE: 29 June 2010

REPRESENTATION:

COUNSEL FOR THE APPLICANT: Ms Stoikovska

SOLICITOR FOR THE APPLICANT: BERGER KORDOS

COUNSEL FOR THE RESPONDENT: Mr Duffy

SOLICITOR FOR THE RESPONDENT: DAVIS ZUCCO LAWYERS

Orders

1. That there be orders in accordance with the minutes of proposed orders marked Exhibit “A” sealed and attached hereto AND IT IS DIRECTED that such minutes remain upon the Court file.

2. That the husband pay the wife’s costs of $4500 relating to these interim proceedings but the payment thereof be stayed until the final determination of the proceedings between the parties.

3. That all outstanding interim applications be otherwise dismissed.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 9957 of 2009

MS KOUSTOUS

Applicant

And

MR KOUSTOUS

Respondent

REASONS FOR JUDGMENT

1. This is an application by both parties for costs.  The wife effectively seeks about $10,570 costs and the husband about $4850.  The distinction between the two sums lies in the preparation of the process predominantly by the wife.  Section 117 of the Act requires that each party in proceedings in this Court pay their own costs.  The exception to that rule is where the Court feels that there is a circumstance or circumstances that justify departing from that rule. 

2. The first question, therefore, is whether there is some justification for making one or other of the parties pay the other’s costs.  If a court contemplates that situation arising then the considerations set out in section 117(2A) apply. 

3. No matter which way one looks at today’s proceedings the fundamental question relates to the sale of the home.  The husband’s position was very clearly set out and very competently argued by his counsel that whilst he wished to keep the home he could only possibly buy out the wife if he knew what her interests were.  It is obvious that in recent weeks this case was going absolutely nowhere unless the sale of the property was commenced.

4. The standoff between the parties precipitated the inevitable proceeding.  The person who, unfortunately, seemed to have adopted a position that made that proceeding inevitable was the husband.  In my view, that is a circumstance that justifies a departure from the principle that each party pays their own costs. 

5. If I look at s 117(2A) they are only matters that I have to have regard to.  None of those particular matters is any more prominent or binding than the other.  I am obliged to consider the financial circumstances of each of the parties to the proceedings; ironically, each spouse has very little income, but by the same token on any view there are hundreds of thousands of dollars of capital sums that ultimately will fall into their hands.  I, therefore, have little concern about their respective financial circumstances in the long run, particularly having regard to Ms Stoikovska’s concession that if an order for costs is made against the husband it can be paid from the property settlement.

6. The second consideration is whether any of the parties is in receipt of assistance by way of Legal Aid, and having regard to what I have heard about their respective property disputes I am not surprised that no one suggested that they were.

7. The third relates to the conduct of the parties to the proceedings.  That relates predominantly to compliance with court orders and I do not take into account the fact that the husband is not complying with the maintenance order.  There are certainly debates between the parties about discovery, but again I do not take that into account in this case having regard to the fact that it seems to have wandered along without a lot of focus on getting to the bottom line which is what the parties have between them to divide.

8. The next consideration is whether or not one of the parties to the proceedings has been wholly unsuccessful.  Neither party has been wholly unsuccessful but certainly in terms of relativities, the husband has been less successful than the wife because, effectively, what I have done today is force the sale in terms other than those which he wanted.

9. I accept that there was a bona fide cause as suggested by Mr Duffy and that there were competing priorities, but these priorities have to take into account the fact that a party incurs significant costs by coming to Court.  Costs are not intended as a punishment, they are intended to compensate the party who has to participate in the proceedings to get it moving.  Were it not for the fact that these proceedings were issued the parties would be languishing in our lists, not to mention the fact there would be significant risks to the asset pool by virtue of not only the creditors but, more importantly, the secured creditor.

10. I am not told of any offers in writing that would have ultimately settled the proceedings, so to that extent I will not take that into account.  It seems to me in the circumstances that there is a justification for an order that the husband pay towards the costs of the wife.

11. The difficulty I have is that the wife is effectively seeking to have her costs paid by the husband on an indemnity basis because of the fact that she is seeking whatever she incurs be covered by the husband.  This is not a case in which I would apply the indemnity costs rule and, therefore, the scale is the appropriate mechanism.  That applies, therefore, to both counsel and solicitors and, in my view, as it is a discretionary exercise the total costs ought to be the sum of $4500.  I shall make a further order that the husband pay those out of his share from the property settlement in due course.

I certify that the preceding eleven (11) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin

Associate: 

Date: 8 July 2010