Kozuch& Asker

[2016] FamCA 117

FAMILY COURT OF AUSTRALIA

KOZUCH& ASKER [2016] FamCA 117

FAMILY LAW – COSTS

APPLICANT: Ms Kozuch

RESPONDENT: Mr Asker

FILE NUMBER: SYC 4396 of 2013

DATE DELIVERED: 2 March 2016

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Rees J

HEARING DATE: In Chambers

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Taylor & Scott Lawyers

SOLICITOR FOR THE RESPONDENT: Merhi & Associates

Orders

IT IS ORDERED

1. That the application for costs filed 22 December 2015 be dismissed.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Kozuch & Asker 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 SYDNEY

FILE NUMBER: SYC 4396 of 2013

Ms Kozuch

Applicant

And

Mr Asker

Respondent

REASONS FOR JUDGMENT

1. An application by the mother, Ms Kozuch (“the mother”) to relocate with the child X (the child) to Russia, was heard by the Court and determined by judgement delivered on 23 November 2015. That application was opposed by the father Mr Asker (“the father”).

2. The mother was permitted to relocate with the child to Russia.

3. By an Application in a Case filed 22 December 2015, the mother seeks orders that the father pay her costs, on an indemnity basis, of the proceedings, assessed at $40,514.55. The father opposes that application.

4. Directions were made for each party to file affidavit material and written submissions and both parties agreed that the matter should be dealt with in chambers without oral submissions.

THE LAW

1. Section 117 of the Act governs costs. S 117(1), (2) and (2A) relevantly provide:

   Costs

   (1) Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.
   (2) If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4), (4A) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.
   (2A) In considering what order (if any) should be made under subsection (2), the court shall have regard to:
   (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.

1. In Hawkins and Roe (2012) 47 Fam LR 526, the Full Court stated at 529:

[13] In considering the law applicable to the determination of costs applications, it is important to recall the general principle under the Act as expressed in s 117(1), that each party to proceedings shall bear their own costs.

[14] In proceedings involving children’s or parenting matters, the general rule is not often displaced. The rationale for this practice is that in such matters it is proper that parents are able to put their case in seeking orders which they believe to be in the best interests of their children. It hardly needs to be said that the nature of family court litigation in relation to children is quite different to a commercial dispute in the state or federal courts.

1. Their Honours further stated at 549:

[146] While in this case the judge expressed adverse findings about the conduct and attitude of the father in his reasons, it is relevant to note that there was no allegation or finding of dishonesty. Nor did his Honour make any adverse findings about the father’s conduct of his case at the trial. Counsel for the mother conceded in oral submissions before us that at no point during the trial did his Honour direct the father to cease repetitive questioning, or to move his questioning more quickly, for example.

[147] While the categories of occasions when costs may be ordered is not limited, the occasions on which such an order should be made in a parenting dispute should have some particular features. Where there is a complete absence of preparedness to compromise in the face of unambiguous expert evidence, where false allegations are made, or where one party is clearly motivated by self interest rather than the best interests of a child, then a judge may well conclude that there are circumstances justifying an order for costs.

1. Turning then to the relevant matters  specified in s 117(2A):

The financial circumstances of the parties

1. The father filed a Financial Statement. He is in receipt of income of $420 per week, working as a first aid trainer. He pays board of $150 per week. In order to defend the substantive proceedings he borrowed from a friend and those funds have not been repaid. He has credit card debts and a tax debt. He has no assets except a modest car and household chattels.

2. In Australia, the mother was employed as a clerk receiving approximately $1,062 per week gross. From that sum, she paid rent and supported the child. However, the mother’s application to relocate was based, in part, on the substantial financial benefit to her of living with her family in Russia. Relevantly, in the reasons for judgement delivered on 23 November 2015, at Paragraph 105, the financial benefits which would flow to the mother from relocation were set out:

   ·    The mother and the child would enjoy a higher standard of living in City Z. Her parents are wealthy and can provide her with self-contained accommodation where she would have her own bedroom.

   ·    The mother would be able to work in the family business.

3. The mother gave evidence in the substantive proceedings that her parents had given her $90,000 to start a café business which ultimately failed and that they had provided her with the money to pay her legal costs and to assist with her living expenses. There was no suggestion that these funds were to be paid back to her parents.

4. It must be assumed that, as permitted by the orders of 23 November 2015, the mother has moved to Russia and enjoys the financial position anticipated in her evidence.

5. The mother’s financial position is superior to that of the father.

6. Even if an order were made for the father to pay the mother’s costs, or part of them, it is not readily apparent that such an order could be enforced or that any fund exists from which payment could be made.

The conduct of the parties in relation to offers of settlement

1. It is submitted on behalf of the mother that the father’s conduct justifies an order for costs. The mother relies on the fact that the father opposed her application for expedition and that his affidavit material was filed late. Further the mother relies on offers of settlement.

2. The first offer was made in June 2013, prior to the commencement of the proceedings. The father was invited to consent to the relocation. He did not.

3. A further offer of settlement was made on 10 December 2014 after the Family Report, which recommended that the mother be permitted to relocate with the child, was released.

4. The last offer was made on 12 June 2015.

5. The father submitted that the offers of settlement did no more than restate the mother’s position that she wanted to relocate with the child to Russia. She made no offer of compromise.

6. I note that in her last offer the mother proposed orders in accordance with her application. In none of her offers did the mother modify or retreat from her substantive application or offer any compromise.

7. Nothing can be drawn from the father’ failure to respond to her offers in circumstances where it remained his case that the child should remain in Australia.

Whether the father was wholly unsuccessful

1. The orders which were made in the substantive proceedings do not precisely mirror the application of the mother. Although the mother was permitted to relocate with the child to Russia, the facilitative orders and the orders for the father’s time with the child were not all as she sought.

2. Significantly, the orders required the mother to sponsor the father if he wished to travel to Russia to spend time with the child. This was an issue that the father raised as a concern in the course of the proceedings.

3. The regime of Skype communication between the father and the child was more liberal than that proposed by the mother

4. It could not be said that the father was “wholly unsuccessful”.

CONCLUSION

1. There is no evidence that the father’s opposition to the relocation application was based on any motive other than his sincere desire that the child should remain in Australia, where the father could spend time with him, and his belief that this would be in the child’s best interests.

2. None of the matters relied upon by the mother justifies the making of an order for costs. In those circumstances, the appropriateness or otherwise of an order for indemnity costs need not be considered.

I certify that the preceding twenty-seven (27) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Rees delivered on 2 March 2016.

Associate: 

Date:  2 March 2016