Kwok & Beng (No 4)
[2022] FedCFamC1F 505
Federal Circuit and Family Court of Australia
(DIVISION 1)
Kwok & Beng (No 4) [2022] FedCFamC1F 505
File number(s): SYC 1577 of 2021 Judgment of: SCHONELL J Date of judgment: 18 July 2022 Catchwords: FAMILY LAW – COSTS – Where the husband sought a costs order following a judgment in which the wife was unsuccessful – Consideration of factors in s 117(2A) of the Family Law Act 1975 (Cth) – Husband’s Application for Costs dismissed – Each party to bear their own costs. Legislation: Family Law Act 1975 (Cth) s 117 Cases cited: Bant & Clayton (Costs) (2016) 56 FamLR 31; [2016] FamCAFC 35
Fisher & Fisher (1990) FLC 92-127; [1989] FamCA 61
Kwok & Beng (No 2) [2022] FedCFamC1F 263
PBF as Child Representative for AF (Legal Aid Commission of Tasmania) & TRF & LKL (2005) 33 FamLR 123; [2005] FamCA 158
Penfold v Penfold (1980) 144 CLR 311; [1980] HCA 4
Division: Division 1 First Instance Place: Sydney Number of paragraphs: 23 Date of last submissions: 14 July 2022 Place: Sydney Solicitor for the Applicant: Kammoun Sukari Lawyers Pty Ltd Solicitor for the Respondent: Luminous Legal ORDERS
SYC 1577 of 2021 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN: MR KWOK
Applicant
AND: MS BENG
Respondent
INDEPENDENT CHILDREN'S LAWYER
order made by:
SCHONELL J
DATE OF ORDER:
18 JULY 2022
THE COURT ORDERS THAT:
1.The Amended Application in a Proceeding filed 23 June 2022 is dismissed.
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 Kwok & Beng has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
SCHONELL J:
By Amended Application in a Proceeding filed 23 June 2022, the applicant husband (“the husband”) seeks an order for his costs arising out of proceedings that culminated in a judgment on 22 April 2022.
Those proceedings related to an application by the respondent wife (“the wife”) seeking to stay proceedings brought by the husband for parenting and property settlement as well as an application by the husband for an anti-suit injunction restraining the wife from continuing proceedings commenced by her in East Asia. The background to the determination is contained in my judgment of Kwok & Beng (No 2) [2022] FedCFamC1F 263.
I do not propose in these reasons to recite the various matters referenced in the judgment, save to note that I made orders that the wife’s application for a stay of the proceedings before this Court be dismissed and an order restraining the wife from continuing proceedings before the People’s Court District B. As is properly conceded by the wife in her written submissions as to costs, the wife was unsuccessful in the determination that culminated in the orders made on 22 April 2022. That of course is not necessarily determinative of the Application for Costs.
The husband relies upon the following:
(1)The judgment of 22 April 2022;
(2)Amended Application in a Proceeding filed 23 June 2022;
(3)Affidavits of the husband’s solicitor filed 6 May 2022 and 23 June 2022;
(4)Financial Statement of the husband filed 21 December 2021;
(5)Financial Statement of the wife filed 26 April 2021;
(6)Exhibit 1, being a Balance Sheet tendered at the interim hearing on 13 April 2022; and
(7)A Schedule of Costs.
Each party filed written submissions in support of and against the Application for Costs and the husband filed submissions in reply.
The form of order the husband sought was:
1. That within 30 days, the respondent pay the applicant’s costs of and incidental to threshold hearing regarding Australia being a clearly inappropriate forum on a party and party basis fixed in the amount of $46,189.80.
An application for costs is governed by the provisions of s 117 of the Family Law Act 1975 (Cth), which provides a general rule that each party to proceedings should bear their own costs.
Section 117(2) reposes in the Court a discretion to make a costs order in circumstances where the Court determines that there are circumstances that justify it making an order and, if there are such circumstances, the Court may make such order as it considers just, having regard to the matters set out in s 117(2A).
In Penfold and Penfold (1980) 144 CLR 311, the plurality in the High Court determined that to make an order under s 117(2), the Court needs to make a finding of justifying circumstances as a preliminary prerequisite to the making of an order. Their Honours also observed that terms such as an exceptional case, special circumstances or a clear case are not necessary determiners of whether or not an order for costs should be made. All that is required or necessary is that there are justifying circumstances.
It is well settled law that no one factor under s 117(2A) is determinative and the Court may give such weight as it considers relevant to any factor. In PBF as Child Representative for AF (Legal Aid Commission of Tasmania) & TRF & LKL (2005) 33 FamLR 123, the Full Court observed:
41. … Nowhere in subs (2A) or elsewhere in s 117, is there any prescription that more than one factor must be present before an order for costs is made nor of comparative weight of the factors set out in subs (2A). As a consequence, there is nothing to prevent any factor being the sole foundation for an order for costs
Dealing now with the relative subsections in s 117(2A).
(a) the financial circumstances of each of the parties to the proceedings
It is clear that a disparity in the financial circumstances of the parties may justify an order for costs in favour of one party. Impecuniosity is not a basis of resistance to a costs order.
Each of the parties have sworn financial statements in the proceedings to date. The wife contends that she does not have an income other than the payment of a sum of money by way of child support and that she has been out of the workforce for some years.
The wife contends that the husband is a wealthy man undertaking a large tourism company in East Asia which has a substantial value. There is no reliable evidence before me that I could, at this stage, reach such a conclusion about the husband. There are funds held in a trust account of approximately $1.9 million, so clearly there is money available to satisfy a costs order.
(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
Neither party is in receipt of legal aid.
(c) the conduct of the parties to the proceedings in relation to the proceedings
The husband contends that the wife unreasonably objected to the jurisdiction of the Court.
The husband’s submission misunderstands the import of the sub-section. Section 117(2A)(c) is limited to conduct of the parties in relation to the proceedings. What is relevant is conduct of a party, which in some way or other leads to an increase in costs by the other party. Such factors may include uncooperative behaviour, obstruction, prolonging litigation or the bringing of unreasonable or unmeritorious applications. It may include non-disclosure or a failure to comply with rules of court in relation to disclosure. By way of example, in Fisher & Fisher (1990) FLC 92-127, a costs order was made in circumstances of a party conducting proceedings in an unjustifiable manner where there were allegations of fault made that were not relevant to any issue in the proceedings
I do not regard the wife bringing the application or resisting the application of the husband to have been unreasonable. The wife’s resistance to the application was, in all the circumstances, arguable. The wife sought to point to various contentions by the husband that would militate against the making of a costs order, which she asserted included failure by the husband to make a full and frank disclosure. In circumstances where there has been no cross-examination, I am unable to make a finding about the husband’s conduct in the proceedings generally.
(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the Court
This is not relevant.
(e) whether any party to the proceedings has been wholly unsuccessful in the proceedings
The term “wholly unsuccessful” refers to a situation in which proceedings as a whole have been unsuccessful, rather than necessarily an application (see Bant & Clayton (Costs) (2016) 56 FamLR 31).
Thus, to the extent to which the husband contends that the wife has been wholly unsuccessful in resisting the husband’s application, while in and of itself it is correct, the subsection itself refers to being wholly unsuccessful in the proceedings. I note the husband contends that that is a strong factor that favours the granting of costs. In my view it is but one aspect of the consideration.
(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
Neither party referred to any offer referable to such a consideration.
(g) any other matter the Court considers relevant
The husband submits, “[i]f the party takes an expensive threshold or jurisdictional point that was always going to have difficulties, that party ought to bear the costs consequences associated with that decision” (husband’s Written Submissions, paragraph 18). I am not of the view that the wife’s position was so unarguable.
In all the circumstances, having had regard to the extensive submissions of the husband and the wife, I am not satisfied that this is an appropriate case to depart from the general rule that each party to the proceedings should bear their own costs.
I will dismiss the husband’s Application for Costs.
I certify that the preceding twenty-three (23) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Schonell. Associate:
Dated: 18 July 2022
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