Kyrkos and Malkin (No 2)
[2020] FamCA 800
•24 September 2020
FAMILY COURT OF AUSTRALIA
| KYRKOS & MALKIN (NO. 2) | [2020] FamCA 800 |
| FAMILY LAW – COSTS – Where the mother seeks an order for costs against the father in respect of a hearing listed upon the Application of the Independent Children’s Lawyer supported by the mother – Where the father opposed the orders sought by the Independent Children’s Lawyer – Where the Court made Orders in accordance with those sought by the Independent Children’s Lawyer – Whether the conduct of the father in opposing the Application justifies making an order for costs – Court finds an order for costs against the father should be made – Order made for lump sum costs against the father. |
| Family Law Act 1975 (Cth) s 117 Family Law Rules 2004 (Cth) r 1.04, 19.18 |
| Byrnes v Brisconnections Management Company Limited (No 2) [2009] FCA 1432 Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish (2005) 33 Fam LR 123 Idoport Pty Ltd v National Australia Bank Ltd [2007] NSWSC 23 Medlon & Medlon (No 6) (Indemnity Costs) (2015) FLC 93-664 Penfold v Penfold (1980) 144 CLR 311 Stoian & Fiening (Costs) [2014] FamCA 944 Wrensted & Eades (2016) FLC 93-697 |
| APPLICANT: | Ms Kyrkos |
| RESPONDENT: | Mr Malkin |
| FILE NUMBER: | SYC | 8562 | of | 2017 |
| DATE DELIVERED: | 24 September 2020 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Sydney |
| JUDGMENT OF: | McClelland DCJ |
| HEARING DATE: | By way of written submissions |
REPRESENTATION
| SOLICITOR FOR THE APPLICANT: | Ms Menkes of Pearson Emerson Family Lawyers |
| SOLICITOR FOR THE RESPONDENT: | Mr Pirintji of Argus Lawyers |
Orders
That, within 28 days of the date of this Order, the father pay the mother’s costs of and incidental to the Application listed before the Court on 28 July 2020 in the sum of $2,006.53.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Kyrkos & Malkin has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: SYC 8562 of 2017
| Ms Kyrkos |
Applicant
And
| Mr Malkin |
Respondent
REASONS FOR JUDGMENT
Introduction
This decision concerns an Application for costs by Ms Kyrkos (“the mother”) against Mr Malkin (“the father”) in respect of an Application by the Independent Children’s Lawyer in this matter for orders to be made for the therapeutic counselling to be provided to the parties’ children, Z born in 2019 and W born in 2011 (collectively, “the children”) and for that counselling to be on a non-reportable and confidential basis. The Application for costs is made in circumstances where the mother consented to the orders sought by the Independent Children’s Lawyer but the father withheld his consent unless an order was made for the counselling to be reportable.
On 10 August 2020, I made Orders in accordance with those sought by the Independent Children’s Lawyer and consented to by the mother and delivered my reasons for judgment.[1]
[1] [2020] FamCA 649.
Relevant background
A summary of the background relevant to this decision is set out in the primary judgment in respect of the Independent Children’s Lawyer’s Application.[2] In addition, I note the following events in the nature of correspondence between the parties as described by the mother in the written submissions filed on her behalf.
[2] Ibid [9]-[25].
On 1 May 2020, the Independent Children’s Lawyer advised the mother and the father that the children’s counsellor, Ms B, had requested a copy of the Single Expert Report prepared by Dr C and that the counselling provided to the children be non-reportable. The solicitor for the mother replied to the Independent Children’s Lawyer confirming the mother’s consent to the proposal conveyed by the Independent Children’s Lawyer. The father’s solicitor was copied into this correspondence.
On 18 May 2020, the Independent Children’s Lawyer sought, by email addressed to the father’s solicitor, a response to the correspondence sent on 1 May 2020, however, did not receive any such response.
On 18 June 2020, the Independent Children’s Lawyer provided proposed terms of settlement, on the limited issue of therapy, to the parties’ respective legal representatives in the form of Orders made by the Court on 10 August 2020.
On 19 June 2020, the mother signed the terms proposed by the Independent Children’s Lawyer and forwarded the signed document to the father’s solicitor to be countersigned. The Independent Children’s Lawyer was copied into this correspondence.
On 23 June 2020, the solicitor for the father, by email addressed to the Independent Children’s Lawyer and the mother’s solicitor, indicated that the father opposed the proposal by Ms B and the Independent Children’s Lawyer for the counselling provided to the children to be confidential.
On 24 June 2020, the Independent Children’s Lawyer sought for the matter to be listed in respect of the issues relating to the counselling provided to the children and, on 28 July 2020, the matter came before me for interim hearing after which, as noted, I made Orders in accordance with those sought by the Independent Children’s Lawyer and consented to by the mother on 10 August 2020.
Applications
Orders sought by the mother
The mother seeks that an order for costs be made in accordance with that set out in her written submissions filed on 17 August 2020, as follows:
1. The mother seeks that the father pay her costs of and incidental to the application listed before the Court on 28 July 2020 in the sum of $2,006.53 plus costs as assessed by the Registrar in accordance with item 106, Schedule 3 of the Family Law Rules 2004 (Cth).
Orders sought by the father
By written submissions provided to the Court, by letter dated 17 August 2020, the father seeks an order reserving costs in respect of the hearing on 28 July 2020.
The law – concepts and principles
Section 117 of the Family Law Act 1975 (Cth) (“the Act”) sets out the basis upon which the Court is empowered to award costs. That section relevantly provides:
(1) Subject to subsection (2), subsections 45A(6) and 70NFB(1) and sections 117AA and 117AC, 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), (5) and (6) 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.
Those provisions make clear that, while the general rule in family law proceedings is that each party bears his or her own costs, the Court may order a party to pay the costs of another where there are circumstances justifying the making of such an order.
The considerations set out in s 117(2A) of the Act must be taken into account in deciding whether or not to order a party to pay the costs of another. No one factor under s 117(2A) prevails over any other factor. It is a matter of weight that is accorded to each of the relevant factors in the trial judge’s discretion: Medlon & Medlon (No 6) (Indemnity Costs) (2015) FLC 93-664 per Strickland J.
As such, a litigant seeking a costs order must establish that the justice of the case requires an order for costs, by reference to the non-exhaustive list of statutory considerations set out in s 117(2A) of the Act, before such an order is made. Although the applicant for costs must establish circumstances which would justify such an order, it is not the case that a costs order can only be made in what has been described as “a clear case”: Penfold v Penfold (1980) 144 CLR 311 at 315.
Accordingly, there is “nothing to prevent any factor being the sole foundation for an order for costs” being made: Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish (2005) 33 Fam LR 123 at 130.
In Wrensted & Eades (2016) FLC 93-697 (“Wrensted & Eades”), the Full Court expressly disagreed with an earlier decision of the Full Court which had determined that different considerations applied in respect to the Court contemplating a possible order for costs in parenting proceedings as opposed to property proceedings. In that respect, the Full Court said, at 81,153:
… if the majority in Hawkins & Rowe, by the use of the words “the occasions on which such an order should be made in a parenting dispute should have some particular features”, were intending to indicate that certain features need to be present before a costs order can be made, we respectfully disagree. The wide discretion in s 117(2) of the Act and lack of distinction between categories of family law cases (including the lack of distinction between parenting and property cases) would in our view render such a conclusion plainly erroneous, place a fetter on discretion which does not have a legislative basis and require us to depart from that conclusion (Nguyen v Nguyen 169 CLR 245 at 268-270; Gett & Tabet (2009) ALR 504 at [261]-[301] especially at [294]; Green v The Queen; Quinn v The Queen (2011) 244 CLR 462 per Heydon J at [84] and [85]; F Firm & Ruane and Ors (2014) FLC 93-611) at [163].
I respectfully agree with the reasoning of the Full Court in Wrensted & Eades (supra) in finding that there is no distinction in the legislative considerations that the Court is required to have regard to in respect to an application for costs in parenting proceedings as opposed to property proceedings.
Contentions
Submissions of the mother
By written submissions filed on 17 August 2020, the following submissions were made on behalf of the mother:
Final orders adjusting the parties’ property were made on 19 October 2018. Those orders required the mother to pay to the father $106,000 in installments, with the last installment due on 19 October 2019. Those orders have been fully complied with. The father otherwise retained his business and other items in his name (including superannuation). The mother understands the father is in fulltime employment and lives rent free with his parents. [s.117(2A)(a)]
Neither party is in receipt of a grant of Legal Aid. Both parties have instructed and met the costs of private solicitors throughout these proceedings. [s.117(2A)(b)]
On 1 May 2020, the ICL contacted the parties seeking their consent to provide a copy of Dr C’s report to Ms B and for the children’s counselling with Ms B to be confidential. The solicitors for the mother replied on the same day, consenting and later signing a minute reflective of the Orders sought by the ICL. [s.117(2A)(c) & (f)] The ICL wrote to the father’s solicitor again on 18 May 2020 and 18 June 2020, seeking his consent. On 19 June 2020, the mother’s solicitor forwarded the signed minute seeking that he countersign same. The father ultimately confirmed that he did not consent on 23 June 2020. [s.117(2A)(c) & (f)]
On 27 July 2020 the father forwarded to the Court his proposed Minute of Orders. The father was wholly unsuccessful in obtaining the contested orders sought in his proposed Minute of Order, particularly noting:
1. Proposed Order 5 sought the parties attend upon a Conciliation Conference in circumstances where the parties’ property settlement had been finalised on 10 October 2018. The father did not press this order on 28 July 2020
2. An order in terms of proposed Order 6 had already been made on 8 January 2018.
3. Orders were not made in accordance with proposed Orders 3 & 4 sought by the father. [s.117(2A)(e)]
On 10 August 2020, Orders were made in accordance with the Orders set out in the minute signed by the ICL and the mother, circulated by the ICL on 18 June 2020. [s.117(2A)(f)]
The mother submits that there are circumstances that justify the court making an order that the husband pay the wife’s costs. [s.117(2)]
Submissions of the father
By letter addressed to the Court dated 17 August 2020 from the solicitor for the father, the following submissions were made on behalf of the father:
1. Given that:
a. the father has not been allowed contact with his children for 2.5 years due to the mother believing the children are traumatised and not ready to have contact with their father;
b. the last psychologist’s report and recommendations regarding the children available to the Court are contained in a report of Dr C dated 12 September 2018; and
c. determination by the Court at the hearing in November 2020 on whether or not the father can see his children will depend on their current not historical psychological states
the father was acting reasonably in arguing for the Court to have the benefit of and access to a more recent psychologist’s report and recommendations.
2. The father did not object to the children receiving therapeutic assistance from the psychologist nominated by the mother (refer to the Consent Orders proposed by him) but wanted either that psychologist or another psychologist who has more recently treated the children to be available for examination at the hearing.
Consideration
It is necessary to determine whether the mother, who seeks an order for costs, has established circumstances justifying such an order which displaces the position articulated in s 117(1) of the Act. It is not necessary to establish extraordinary or exceptional circumstances, however, there must be circumstances which, at the absolute discretion of the Court, justify a costs order: Stoian & Fiening (Costs) [2014] FamCA 944 at [19] (“Stoian”) having regard to the matters set out in s 117(2A) of the Act.
Subsection (2A)(a) – The financial circumstances of each of the parties to the proceedings
The Court is without information concerning the financial circumstances of the parties but understands that neither party is in a position where they can or should be placed in a situation where they unnecessarily spend funds on legal proceedings.
Subsection (2A)(b) – Whether any party to the proceedings is in receipt of assistance by way of legal aid
Neither party was legally aided and, accordingly, s 117(2A)(b) of the Act is not a relevant consideration.
Subsection (2A)(c) – The conduct of the parties to the proceedings in relation to the proceedings
The father’s opposition to the orders sought by the Independent Children’s Lawyer and supported by the mother was, primarily, on the basis that he wanted additional evidence to be available for the final hearing regarding the children’s mental health. Specifically, the father “wanted either [the children’s current treating] psychologist or another psychologist who has more recently treated the children to be available for examination at the hearing”.
In that respect, the father’s position misunderstood the purpose and intent of the Application by the Independent Children’s Lawyer which was, fundamentally, to obtain therapeutic intervention to assist the children who have been placed in a stressful situation as a result of the parental conflict and this ongoing litigation. The Application was not for the purpose of obtaining evidence in these proceedings.
Insofar as the father may, if he so chooses, seek to present additional evidence regarding the children’s mental health over and above that provided by the single expert forensic psychiatrist, Dr C, who has been appointed to give evidence in these proceedings and, specifically, evidence from a psychologist, the appropriate course of action was for him to make, if he so chooses, an application either for the appointment of a single expert psychologist or to seek permission to call evidence from an adversarial expert psychologist.
That is not to say, of course, that such an application would necessarily be granted. The Court would make a determination in respect to any such application based on the evidence and submissions of the parties, including, most relevantly, whether the criteria and factors specified in the Rules as justifying such an appointment was satisfied.
Subsection (2A)(d) – Whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the Court
This consideration is not relevant.
Subsection (2A)(e) – Whether any party to the proceedings has been wholly unsuccessful in the proceedings
The father was wholly unsuccessful in his opposition to the Application by the Independent Children’s Lawyer.
Subsection (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 consideration is not relevant.
Subsection (2A)(g) – Such other matters as the Court considers relevant
It is my view that the Independent Children’s Lawyer in this matter made a simple and straightforward request which was readily agreed to by the mother. This was, accordingly, a simple and straightforward matter and is the sort of matter that the Court reasonably expects the parties and their legal representatives to attempt to resolve consistent with their obligation pursuant to r 1.04 of the Family Law Rules 2004 (“the Rules”). That did not occur as a result of the father’s opposition to the reasonable position advanced by the Independent Children’s Lawyer.
Amount of costs
Rule 19.18 of the Rules provides for the methods of calculating costs. These include, in r 19.18(1)(a), the Court fixing upon a specific amount for costs or, in r 19.18(1)(b), an order for the costs to be assessed on a particular basis, including for a lump sum amount.
In Stoian (supra) at [91], Kent J endorsed the principles for applying a rule equivalent to r 19.18 of the Rules as adumbrated by Einstein J in Idoport Pty Ltd v National Australia Bank Ltd [2007] NSWSC 23 at [9] (“Idoport v National Australia Bank”). Those principles are:
i. the purpose of the rule is to avoid the expense, delay and aggravation involved in protracted litigation arising out of taxation…;
ii. the touchstone requires that the Court be confident that the approach taken to estimate costs is logical, fair and reasonable…;
iii. the fairness parameter includes the Court having sufficient confidence in arriving at an appropriate sum on the materials available…;
iv. a gross sum assessment, by its very nature, does not envisage that a process similar to that involved in a traditional taxation or assessment of costs should take place…;
v. the gross sum “can only be fixed broadly having regard to the information before the Court”…;
…
(Citations omitted)
Consistent with those principles, it has been determined that, where a court orders a party to pay costs, it may be appropriate for the court to fix a lump sum. By doing so, the court can avoid further delay and inconvenience being occasioned by the requirement to tax a bill: Byrnes v Brisconnections Management Company Limited (No 2) [2009] FCA 1432 at [51].
As noted above, in the written submissions filed on her behalf, the mother seeks an order for “the sum of $2,006.53 plus costs as assessed by the Registrar in accordance with item 106, Schedule 3 of the Family Law Rules 2004 (Cth)”. In that respect, the solicitor for the mother annexed to the written submissions a schedule setting out the manner in which costs were calculated in arriving at the figure of “$2,006.53 plus costs as assessed by the Registrar in accordance with item 106”.
The purpose for making an order for lump sum costs is to avoid additional time and administrative resources being occupied through the assessment process. In those circumstances, I do not make an order for “costs as assessed by the Registrar” in respect to the solicitor’s costs for reading and considering the reasons for judgment handed down on 10 August 2020. I, nonetheless, determine that the amount of $2,006.53, as set out in annexure B to the mother’s submissions, is logical, fair and reasonable and I make an order for the father to pay costs in that sum within 28 days of the date of the order.
I certify that the preceding thirty-six (36) paragraphs are a true copy of the reasons for judgment of the Honourable Deputy Chief Justice McClelland delivered on 24 September 2020.
Associate:
Date: 24 September 2020
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