Leroux and Leroux and Anor

[2018] FamCA 360

FAMILY COURT OF AUSTRALIA

LEROUX & LEROUX AND ANOR [2018] FamCA 360

FAMILY LAW – COSTS – where the applicant seeks costs against the first and second named respondents on a party party basis – where the respondents oppose the costs application– where there are circumstances that justify an order for costs in favour of the applicant against the first and second-named respondents – order that the first-named respondent should be responsible for 75 per centum of the assessed costs and the second-named respondent for 25 per centum of those costs.

Family Law Act 1975 (Cth) s 117, 117(2A)
Family Law Rules 2004 (Cth) r 19.18

I and I (1995)  FLC 92-625
Lenova & Lenova (Costs) [2011] FamCAFC 141
Robinson & Higginbotham (1991) FLC 92-209

APPLICANT: Ms Leroux

FIRST RESPONDENT: Mr Leroux

SECOND RESPONDENT: Mr H Digby

FILE NUMBER: HBC 909 of 2014

DATE DELIVERED: 23 MAY 2018

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Johns J

HEARING DATE: Written Submissions In Chambers

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Blissenden Lawyers

THE FIRST RESPONDENT: In Person

THE SECOND RESPONDENT: In Person

Orders

1. That the first-named respondent pay 75 per centum of the applicant’s costs of and incidental to the proceedings of 20 April 2018, the Application in a Case filed 10 February 2017, the Amended Application in a Case filed 10 February 2017 and the Amended Application in a Case filed 23 March 2017 (“the Proceedings”), such costs as agreed and in default of agreement as assessed on a party and party basis.

2. That the second-named respondent pay 25 per centum of the applicant’s costs of and incidental to the Proceedings, such costs as agreed and in default of agreement as assessed on a party and party basis.

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 Leroux & Leroux and Anor 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 MELBOURNE

FILE NUMBER: HBC 909 of 2014

Ms Leroux

Applicant

And

Mr Leroux

First Respondent

And

Mr H Digby

Second Respondent

REASONS FOR JUDGMENT

Introduction

1. On 20 April 2017 I made orders by consent with respect to applications filed by the applicant, who is the wife in the principal proceedings, seeking enforcement of final property orders made by Rees J on 7 October 2016 (“final orders”).  That day I also made orders that all extant interim applications be dismissed and that the question of costs of that day be reserved.

2. On 15 August 2017 Registrar Field made the following orders:

   1.All extant applications for costs are adjourned to a date to be fixed before Justice Johns.

   2.No later than the 15 September 2017 the parties file and serve any written submissions that they wish to make in support of their application that the other party/ies pay their costs in respect to the proceedings commenced by the Wife’s Application in a Case filed 10 February 2017.

   3.Within 28 days of receipt of any written submissions, the other party/ies file and serve any written submissions in response thereto upon which they seek to rely.

   4.Within 7 days after receipt of any material in response, the party seeking an order for costs file and serve any written submissions in reply.

   5.All parties file the documents required by these orders by email to …

   6.Unless Justice Johns directs otherwise, the determination of any cost application be heard and finalised in chambers.

3. On 15 September 2017, in accordance with paragraph 2 of Registrar Field’s orders the applicant wife filed written submissions in which she sought orders for costs against the first and second named respondents. The applicant seeks orders as follows:

   An Order that the Respondents pay the Applicant’s costs in such proportions as the Court determines appropriate on a party party basis of the 20^th of April 2017 and of the Application in a Case filed 10 February 2017 and the Amended Application in a Case filed 10 February 2017 and 23 March 2017, those costs to be agreed and failing agreement, as assessed pursuant to the Family Law Rules.

4. The first and second named respondents oppose the applicant’s application for costs.

5. The first-named respondent, who is the husband in the principal proceedings, filed written submissions on 16 October 2017 seeking that the wife’s application for costs be dismissed and that there be no order for costs made against him or the second-named respondent.

6. The second-named respondent, who is the father of the first-named respondent, also filed written submissions on 16 October 2017 seeking that the wife’s application for costs be dismissed and that no order for costs be made against the first or second-named respondent.

7. The wife did not file any submissions in reply to those of the first and second named respondents.

8. These are my Reasons for Judgment with respect to the wife’s applications for costs.

Background

1. The wife was born in 1981 and is aged 36 years.

2. The husband was born in 1978 and is aged 40 years.  His occupation, as described in his affidavit filed 16 October 2017, is student.

3. The second-named respondent is retired.

4. The husband and wife married in 2000 and final separation occurred in 2013.  They divorced in 2015. 

5. There are two children of the marriage, aged 16 and 14 years.  Pursuant to the final orders, the children live with the wife and spend such time with the husband as they elect.  The wife has sole parental responsibility for the children’s long term care, welfare and development.

6. On 7 October 2016, following an 11-day hearing, Rees J made the final orders in respect of both parenting and property matters. 

7. The final orders made by Rees J included the following:-

   (13) That the [wife] do all things required to sell the land at [L Town, Country K], to pay all selling costs, and to pay 30 per cent of the net proceeds of sale to the [husband].

   …

   (15)That within two months of the date of these Orders, the [husband] pay to the [wife] the sum of $119,000, and simultaneously with the payment of that amount, the [wife] shall sign all documents  required to transfer to the [husband] her interest in the property known as [X Street, Suburb Y] and the [husband] shall thereafter indemnify the [wife] against all liability to repay money advanced by way of mortgage to the [husband] and the [wife] by [Ms Digby] and [the second respondent].

   (16)In the event that the [husband] does not pay the sum of $119,000 within two months of the date of these Orders, then the [husband] and the [wife] shall do all things required to sell the property at [X Street, Suburb Y] and to pay the proceeds of sale in the following manner and priority:

   (a)To discharge the mortgage;

   (b)To pay all selling costs including agents’ commission and selling costs, and solicitors’ costs on the conveyance;

   (c)To pay 70 per cent of the balance remaining to the [wife];

   (d)To pay the balance to the [husband].

8. On 10 February 2017 the wife filed an Application in a Case seeking orders to enforce paragraphs 13 and 16 of the final orders. An Amended Application in a Case was filed on behalf of the wife later that same day.

9. A further Amended Application in a Case was filed on behalf of the wife on 23 March 2017.  The orders sought by the wife included that:-

   ·The husband swear documents provided and return same to the wife’s solicitors for the purpose of removing the Caution lodged by the husband and registered against the titles to the properties in Country K] and an order pursuant to s 106A of the Family Law Act1975 (Cth) (“the Act”) that a Registrar of the Hobart Registry of the Court execute those documents in the event of the husband’s non-compliance.

   ·That pursuant to s 106B of the Act the transfer of land executed by the husband transferring the Suburb Y property to the second-named respondent on 3 January 2017 be set aside.

   ·That in order to effect the setting aside of the transfer of land of the Suburb Y property, the second-named respondent execute a transfer of land transferring his interest in the property at Suburb Y to the husband, and in the event of his non-compliance that a Registrar of the Family Court of Australia at Hobart be appointed pursuant to s 106A of the Act to execute that document.

   ·That the wife has sole authority to arrange the sale of the property at Suburb Y.

   ·Injunctions restraining the husband and the second-named respondent from undertaking works at the Suburb Y property.

   ·That the husband deliver to the wife’s solicitor a withdrawal of caveat in respect of the Suburb Y property and in default of that order that pursuant to s 106A of the Act a Registrar execute that withdrawal in the husband’s name.

10. In her affidavit filed 10 February 2017 in support of her application, the wife deposed that the date for the payment of monies due to the wife by the husband pursuant to paragraph 15 of the final orders was 6 December 2016 and the husband had failed to make the payment.[1] The wife also deposed that on 9 January 2017 she learned that a transfer of land executed by the husband was registered recording a transfer of his legal interest in the Suburb Y property to the second-named respondent.[2] The wife deposed that the husband at no time provided her with any notice of this transfer.

    [1] Affidavit of the wife filed 10 February 2017, par 5.

    [2] Ibid par 18.

11. The Husband on 6 April 2017 filed two Responses to an Application in a Case, one sealed at 4:16am and one sealed at 10:13am. In the Response to an Application in a Case sealed at 10:13am the husband sought a stay of paragraphs 12 to 15 inclusive of the final orders pending determination of the husband’s appeal against the final orders.  The husband sought in the alternative orders relating to the implementation of the final orders.

12. In support of those responses the husband filed two affidavits.  In his affidavit filed at 4.16am on 6 April 2017, the husband deposed that he has “done all things as required of me” pursuant to the final orders.[3]

    [3] Affidavit of the husband filed 6 April 2017 sealed at 4:16am, par 8.

13. Later on the 6 April 2017 the husband filed his second affidavit at 10:13am. That affidavit referred to a number of issues but notably stated that:

    Since the date of the order my father…has exercised his right as mortgagee and taken possession of my interest in the property as mortgagee in satisfaction of the debt the Wife and I owed to him in the sum of approximately $145,000.[4]

    [4] Affidavit of the husband filed 6 April 2017 sealed at 10:13am, par 15.

14. The husband deposed that he had not made the payment to the wife of $119,000 but deposed to having made interest payments to her.[5]

    [5] Ibid pars 18, 20.

15. Given the husband’s application for a stay of the operation of the final orders pending appeal, on 6 April 2017 I made orders as follows:

    1.That the hearing of paragraph 1 of the respondent husband’s Response to an Application in a Case filed 6 April 2017 (“the Stay Application”) be listed for hearing before Rees J on a date to be fixed.

    …

    3.That the applicant file and serve any affidavit in reply to the affidavits filed by the respondent in support of the Stay Application and a list of documents relied upon by 4.00pm on 7 April 2017.

    4.That the Amended Application in a Case filed 23 March 2017 and paragraphs 2 to 12 inclusive of the respondent’s Response to Application in a Case filed 6 April 2017 be adjourned for hearing before me at 10.00am on 20 April 2017.

    5.That save as provided in these orders no party file any further material in respect of the Amended Application in a Case filed 23 March 2017 and the Response to Application in a Case filed 6 April 2017.

    …

16. The husband filed a Notice of Discontinuance of his appeal against the final orders on 7 April 2017.  Accordingly, on 19 April 2017 I made orders that paragraph 1 of the husband’s Response to an Application in a Case relating to the husband’s stay application be dismissed without costs.

17. On 20 April 2017 the wife’s Amended Application in a Case and the husband’s Response to an Application in a Case were listed for hearing before me. That day each of the parties was represented by Counsel.  Ultimately all matters were resolved by consent and I made orders as follows:

    1.THAT for the purpose of implementation of Paragraphs 15 and 16 of the Order of this Court dated 7th October 2016:-

    (a)The Second Respondent forthwith execute and deliver to the Applicant’s solicitors a Memorandum of Transfer in favour of a yet to be identified Purchaser with respect to his interest in the land comprised in Certificate of Title Volume … Folio … (“the Property”), together with the original Certificate of Title, such Memorandum of Transfer and Certificate of Title to be held in escrow by the Applicant’s solicitors for use only in the event of non-compliance with Paragraph 1(b) below and for the purpose of completing the sale referred to in Paragraph 1(c);

    (b)The First Respondent shall have 30 days from the date of this Order to obtain written confirmation of finance himself and/or the Second Respondent sufficient to enable him and/or the Second Respondent to effect payment to the Applicant of $119,000.00 together with interest thereon at the daily rate of $25.27 from and including 6 December 2016 AND to effect that payment within 45 days thereafter with the said interest to run to the date of that payment (the said $119,000 plus interest called the “Payment”);

    (c)In the event of non-compliance with Paragraph 1(b) above the Property shall be sold with the proceeds of sale to be paid in the following manner and priority:-

    (i) To pay all selling costs including agents commission and solicitors costs on the conveyance;

    (ii)To pay to the Second Respondent the sum of $145,000.00;

    (iii)  To pay to the Applicant the Payment;

    (iv) To pay to the First Respondent $51,000;

    (v)To distribute any balance as agreed or as ordered by the Court.

    (d)For the purpose of the sale referred to in Paragraph 1(c) the Sale Machinery Provisions annexed hereto and marked “A” shall apply;

    (e)For the purpose of the sale referred to in Paragraph 1(c)

    (i) If the Property is let the Respondents shall on the listing date supply the listing agent and Applicant’s solicitors with a copy of any Lease;

    (ii) If the First Respondent is living at the Property and in any event he shall vacate the Property within 21 days of the listing date ensuring all building materials situate in, on or around the Property and all chattels and household effects not belonging to any tenant in occupation of the Property are removed with all unlaid sandstone to be removed within 7 days thereafter;

    (iii) The First Respondent shall on the listing date deliver to the Applicant’s solicitors signed by him a Withdrawal of Caveat D … in registrable form to be held in escrow pending settlement of the sale;

    (iv) The Respondent’s shall deliver to the listing agent all keys and other opening devices to the Property within 21 days of the listing date.

    2.THAT both the First Respondent and Second Respondent are hereby restrained from undertaking any works or contracting with a third party for the undertaking of any works of any description, including building works or the laying of sandstone blocks at or to the Property unless the undertaking of those works is agreed to in writing prior to the commencement of those works by the Applicant and the Second Respondent or are reasonably recommended by the listing agent, the Respondents to be solely responsible for meeting the costs of those works this Order to cease to have effect if there is compliance with Paragraph 1(b) of this Order.

    3.THAT if any Party fails to sign a document required for the purpose of the implementation of these Orders the Registrar of the Hobart Registry of this Court is pursuant to Section 106A of the Family Law Act 1975 (Cth), appointed to execute such document in the name of the defaulting party and to do all acts and things necessary to give validity and operation to the document.

    4.THAT within 48 hours of this Order the First Respondent have his legal representative in the [Country K] provide to the Applicant’s solicitors with a copy of the Withdrawal of the Caution referred to below and failing this, that for the purpose of implementation of Paragraph 13 of the Order of this Court dated 7 October 2016 the First Respondent shall within 48 hours swear the documents annexed hereto and marked “B” and deliver them to the Registrar of the Hobart Registry of this Court (“the Registrar”) AND should any further documents be required for the purpose of removing the Caution lodged by the First Respondent and registered against titles S2616 and S3662 to lands in the [Country K] which require the First Respondent’s signature the First Respondent shall attend to that and return the documents to the Registrar within 48 hours of being presented those documents by the Applicant’s solicitors. AND in the event of non-compliance by the First Respondent with this Order, the Registrar of the Hobart Registry of this Court is pursuant to Section 106A of the Family Law Act 1975, appointed to execute any such documents in the name of the First Respondent and to do all acts and things necessary to give validity and operation to the documents, such documents to be released to the Applicant’s solicitors upon proof of there being settlement of sale of either or both of the said lots of land being imminent.

    5.THAT the Applicant arrange to list the land referred to in Paragraph 4 for sale within 30 days of the date of this Order.

18. As noted I also made orders that all extant interim applications, save as the question of costs, be dismissed and that the question of costs of that day be reserved. 

19. The wife seeks costs in respect of those enforcement proceedings.

Documents relied upon

1. The wife relies upon her submissions filed 15 September 2017 and the documents identified at pages 1 and 2 of those submissions.

2. The husband relies upon his written submissions filed 16 October 2017 and the documents referred to in paragraph 8 of those submissions.

3. The second-named respondent relies upon his written submissions filed 16 October 2017 and the documents referred to in paragraph 2 of those submissions.

Legal Principles

1. The question of costs is governed by section 117(1) of the Family Law Act 1975 (Cth) (“the Act”) which provides:-

   Subject to sub-section (2), subsection 70NF(b)(1) and sections 117AA, 117AC and 118, each party to proceedings under this act shall bear his or her own costs.

2. That is, the general rule in proceedings under the Act is that subject to the provisions of s 117(2) of the Act, the parties to the proceedings shall bear their own costs of the proceedings.

3. Section 117(2) of the Act provides that if the Court is of the opinion that there are circumstances that justify it doing so, the Court may, subject to sub-sections (2A), (4), (4A) and (5) and the applicable Rules of Court, make such order as to costs and security for costs as the Court considers just.

4. Section 117(2A) of the Act provides that in determining what order (if any) should be made under sub-section (2) the Court must have regard to the following:-

   (a)the financial circumstances of each of the parties to the proceedings;

   (a)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;

   (b)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;

   (c)whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;

   (d)whether any party to the proceedings has been wholly unsuccessful in the proceedings;

   (e)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

   (f)such other matters as the court considers relevant.

1. Costs are not awarded as punishment of the unsuccessful party, but rather are compensatory in the sense that they are awarded to ameliorate the expense of the successful party as a result of having been required to participate in the legal proceedings.

2. The discretion in s 117 of the Act is broad and the relevant factors in s 117(2A) are not to be read in a restrictive way; any one of those factors may found an order for costs but all factors must be taken into account and balanced (I and I (1995) FLC 92-625).

3. The Family Law Rules 2004 (Cth) (“the Rules”) provide that the court may make an order for costs on a number of different bases and Rule 19.18 sets out the method of calculation of costs, providing that:-

   (3) In making an order under subrule (1), the court may consider:

   (a) the importance, complexity or difficulty of the issues;

   (b) the reasonableness of each party’s behaviour in the case;

   (c) the rates ordinarily payable to lawyers in comparable cases;

   (d) whether a lawyer’s conduct has been improper or unreasonable

   (e) the time properly spent on the case, or in complying with pre-action procedures; and

   (f) expenses properly paid or payable.

The wife’s contentions as to the circumstances justifying an order for costs

1. In support of her application for costs against the first and second named respondents, the wife principally relies upon the following considerations:-

   ·The conduct of the first and second named respondents in relation to the proceedings;

   ·That the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the Court; and

   ·Whether any party to the proceedings has been wholly unsuccessful in the proceedings.

Section 117(2A)(a) The financial circumstances of the parties

1. The wife relies upon her financial statement filed 13 September 2017 to evidence her financial circumstances.  At Part D of that document the wife deposes that her only sources of income are a disability support pension and Family Tax Benefits A and B as well as rental assistance.  Her total income from those sources is $774 per week. 

2. Further, at paragraph 13 of Part D the wife deposes that currently she receives no child support in respect of the two children of the marriage.

3. At Part I of her financial statement, the wife discloses assets valued at approximately $155,935, the principal asset being her interest in property in the Country K. 

4. At Part K of her financial statement the wife deposes that she has liabilities of approximately $154,500, and at paragraph 54 of that Part she deposes that she has outstanding legal costs of $92,513.  It is submitted at page 3 of the wife’s submissions that the payment received by her pursuant to paragraph 14 of the final orders has been applied to the partial discharge of the wife’s legal costs and that the liability disclosed in her financial statement is the balance remaining after payment of those costs.  It is further submitted that the wife will only be able to satisfy the outstanding amounts to her lawyers upon sale of the property in the Country K. 

5. In his submissions filed 16 October 2017 the husband contends that his financial circumstances have worsened as a consequence of the final orders.  He submits that this is so as a result of him being entitled to only 30 per centum of the matrimonial asset pool pursuant to those orders.  Notwithstanding his complaints as to the amount received upon the final orders, I note that the husband abandoned his appeal against the final orders.

6. The husband filed a financial statement on 19 October 2017.  That document discloses that the husband is a student and that he has no income.  He discloses expenses of approximately $376 per week.  At Part I of his financial statement the husband discloses interests in property valued at approximately $376,112.  His liabilities disclosed at Park K of that document are estimated to be $413,932.

7. The second-named respondent filed a financial statement on 17 October 2017.  In that document, he discloses income, being an age pension of $386 per week.  He discloses expenses of $583 per week.  At Part I of that document the second-named respondent discloses assets of $537,300 and liabilities of approximately $6,000.

8. Both the first and second named respondent submit that the applicant is in a superior financial position to them by virtue of the property settlement received by her as a result of the final orders made in October 2016.  I do not accept those submissions in circumstances where it is evident from the wife’s financial statement that she has substantial outstanding legal expenses arising from these proceedings, as well as other litigation.  I am satisfied, having regard to the financial statements of both the applicant and the first respondent, as well as the affidavit of the first respondent filed 16 October 2017, that these proceedings have imposed a significant financial burden upon them.

Section 117(2A)(b) Whether either party is in receipt of legal aid

1. None of the parties is in the receipt of legal aid.

Section 117(2A)(c)The conduct of the parties in relation to the proceedings

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

1. It is submitted on behalf of the wife that the enforcement proceedings commenced by her on 10 February 2017 were necessitated by the failure of the husband to comply with the final orders.  The final orders required the husband to sign documents enabling the withdrawal of the caution lodged by him against the titles to the land in the Country K. 

2. Further the wife submits that in circumstances where the husband failed to make the payment pursuant to order 14 of the final orders, the action taken by him in transferring the Suburb Y property to the second-named respondent, notwithstanding that in default of payment there were orders for its sale (order 16 of the final orders), is conduct which justifies an order for costs. 

3. The effect of the transfer of the property by the husband to the second-named respondent, without prior notice to the applicant, was to frustrate the operation of order 16 of the final orders. It was that conduct that was the catalyst for the wife’s application to set aside that transaction pursuant to s 106B of the Act. It is further submitted that the second-named respondent was a party to that conduct, executing documents enabling the discharge of the mortgage registered against the title to the property and executing a transfer of land in his favour.

4. The applicant wife submits that the second-named respondent had notice of the final orders, a sealed copy of that order having been served upon him at his residential address. 

5. It is further submitted that the filing of the Amended Application in a Case on 23 March 2017 was necessitated as a result of the first and second named respondents’ undertaking works at the Suburb Y property without the wife’s prior consent.  It was submitted that the commencement of those construction works was action likely to frustrate the completion of the final orders.

6. The applicant wife is also critical of the conduct of the first-named respondent at the hearing on 6 April 2017.  That day the first-named respondent filed a Response to Application in a Case seeking a stay of the operation of the final orders pending determination of his appeal against those orders, that appeal having been filed on 2 November 2016. 

7. As a consequence of the stay application made by the first-named respondent, the hearing of the wife’s Amended Application in a Case was adjourned to 20 April 2017. 

8. The day after the adjournment of the wife’s enforcement application, being 7 April 2017, the husband filed a Notice of Discontinuance in respect of his appeal against the final orders.  The wife submits that having regard to that chronology an inference should be drawn that the husband’s stay application was a strategic application so as to postpone the hearing of the wife’s enforcement application.  Having regard to the action of the husband in filing a Notice of Discontinuance the day after the adjournment was granted, there is much force in that submission.

9. The wife is also critical of the second-named respondent’s failure to appear at the hearing on 6 April 2017.  She points to the conduct of the second-named respondent in attending to service of documents on behalf of the first-named respondent on 6 April 2017 in respect of these proceedings.  Further, the applicant wife relies upon the fact that the Application in a Case, Amended Application in a Case and affidavit of the applicant filed 10 February 2017 and the affidavit of her solicitor filed 17 February 2017 were sent to the second-named respondent by letter dated 17 February 2017 to his address for service, and further they were transmitted by email to him on 23 February 2017.

10. The applicant wife also relies upon the affidavit of her solicitor filed 23 March 2017 wherein he deposes that the second-named respondent was personally served with those applications at 1.32pm on 23 March 2017 but returned them some minutes later claiming not to be a party to the proceedings.

11. In response to the criticisms of his conduct, the first-named respondent submits that he represented himself in the proceedings due to “financial necessity”.  He submits that he has endeavoured to resolve the matter, that he engaged counsel to negotiate on his behalf and points to the fact that the matter was resolved by consent on 20 April 2017.  In support of his submission as to his previous efforts to resolve the dispute the first respondent relies upon correspondence forwarded by his conveyancer on 5 December 2016 wherein he sought an extension of time for payments due under the final orders.  He also submits that he paid interest on the outstanding payment.

12. Finally, the first-named respondent relies upon the fact that following the orders dated 20 April 2017 he obtained the finance necessary to enable him to comply with the final orders and notes that such payment was eventually made to the applicant to perfect the orders.

13. The first-named respondent does not otherwise respond to the criticisms of his conduct by the applicant wife. 

14. The submissions made on behalf of the second-named respondent with respect to this conduct are in similar terms to those of the first-named respondent.  Again he relies on the fact that he was self-represented during the proceedings and submits that the matter was ultimately resolved by consent on 20 April 2017.  Again, he ignores the submissions made by the applicant with respect to his conduct in the period between the making of the final orders in October 2016 and the filing by the applicant of her Applications in a Case arising from the first-named respondent’s alleged non-compliance with the final orders.

15. Both the first and second named respondent submit that the conduct of the applicant wife was “unnecessarily difficult”.  It is submitted that had the wife granted a short extension of time to enable finance to be obtained the enforcement proceedings may have been avoided.  I do not accept that submission.  The payment to the wife pursuant to the final orders was due to be paid on 6 December 2017.  The wife’s first Application in a Case was not filed until 10 February 2017 and the matter was first listed before me on 6 April 2017.  By the date of the first hearing a period of four months had elapsed from the due date for the payment.  In my view the husband had already had significant time in which to rectify his breach of the final orders prior to that hearing.

16. Further, those submissions ignore the actions taken by the first and second respondent in January 2017 to affect a transfer of the Suburb Y property to the second-named respondent. Those actions thwarted the operation of the final orders and necessitated the wife’s amended application seeking relief pursuant to s 106B of the Act to set aside the transaction.

17. The second-named respondent further submits that it was not his failure to comply with orders which gave rise to the enforcement application.  I accept that he was not a party to those orders.  Nonetheless, I am satisfied having regard to the history, particularly to the fact that the second-named respondent was served with the final orders and participated in the execution of documents, the effect of which was to transfer the Suburb Y property from the husband to him notwithstanding the provisions of paragraph 16 of the final orders, that his conduct in concert with the first-named respondent gave rise to the enforcement application.

18. I am satisfied, having regard to the procedural history that the actions of the first-named respondent in failing to execute documents necessary to cause a withdrawal of the caution over the Country K property and in transferring his interest in the Suburb Y property to the second-named respondent, his father, was conduct which gave rise to the current proceedings.  Further, I am satisfied having regard to the orders made by Rees J on 7 October 2016 that the enforcement proceedings instituted by the applicant wife were necessitated as a result of the failure of the first-named respondent to comply with those orders.

Section 117(2A)(e) Whether a party to the proceedings was wholly unsuccessful

1. It is conceded by the applicant, quite properly in my view, that neither party was wholly successful in the proceedings.  Nonetheless, I have regard to the fact that the orders made by consent on 20 April 2017 had the effect of enabling the implementation of the final orders.  To that extent the applicant was successful in her application to enforce the final orders.

Section 117(2A)(f) Whether either party to the proceedings has made an offer in writing to the other party to the proceedings and the terms of that offer

1. The applicant submits that this sub-section is not relevant.

2. The first-named respondent submits at paragraph 21 of his submissions that by correspondence dated 19 April 2017 the second-named respondent’s solicitors wrote to the applicant and made an offer to settle the matter.  The first-named respondent submits that he supported that offer.  The second-named respondent also places reliance upon the offer made by him to the applicant on 19 April 2017.  That offer is Annexure G to the affidavit of the second-named respondent filed 16 October 2017. 

3. The intent of s 117(2A)(f) of the Act in relation to settlement offers was considered by Nygh J in Robinson & Higginbotham (1991) FLC 92-209 where he stated:

   …when one looks at paragraph (f) it is quite clear that the purpose of that provision is to ensure that offers to settle, if made seriously, are considered seriously, to ensure that the cost of litigation is avoided, the workload of this court is lightened, and one other consideration is certainly that a party with greater wealth is not placed in a position whereby he or she can wear out the other by simple attrition…

4. I do not accept that the correspondence from the second-named respondent’s solicitor to the wife’s solicitor on 19 April 2017 could be described as an offer made to avoid the costs of litigation.  That correspondence notes proposals by the respondents that there be an approach to a bank to seek finance, the position with respect to such application for finance to be known within 30 days with the possibility of settlement within 60 days (emphasis added).  In the penultimate paragraph of that correspondence the second-named respondent’s lawyer identifies issues relating to an argument as to whether the equity created by alleged improvements to the property ought to be the cost of such improvements or the increased value of the property.  The correspondence contemplates the appointment of a valuer to determine those matters.  Otherwise that letter confirms that Mr Williams is briefed to appear on behalf of the second-named respondent at the hearing the following day, 20 April 2017.

5. Whilst the orders made 20 April 2017 make provision for the first-named respondent to seek finance there are specific injunctions in respect of the first and second named respondent undertaking further works with respect to the property, orders for the execution of documents by a Registrar of the Court pursuant to s 106A and further orders in relation to the first-named respondent executing documents to cause a withdrawal of the caution over the titles to the Country K properties. The orders made by consent on 20 April 2017 address and finalise matters not raised in the letter from the second-respondent’s lawyer.

6. The reality is that the first proposal made by or on behalf of the respondents to resolve the enforcement proceedings was made the day before the hearing and that proposal did not address all outstanding issues.  Further, the correspondence indicates that the intention was for the parties to appear at the hearing of the enforcement application. 

7. Accordingly, I do not accept the submission of the first and second named respondent that the terms of the letter dated 19 April 2018 is an offer capable of defeating the wife’s claim for costs.

Section 117(2A)(g) Any other matters the court considers relevant

1. It is submitted on behalf of the applicant that the conduct of the first and second named respondents was designed to distract or disrupt the applicant and the Court in determining her applications to enforce her entitlements pursuant to the final orders.  She relies upon the filing by the first-named respondent of multiple affidavits on 5 and 6 April 2017 and again on 18 and 19 April 2017, often outside of business hours and further points to the fact that those documents were not served on the applicant as required under the rules of Court.  She also relies upon the deliberate act of the first-named respondent to transfer the title to the Suburb Y property to his father the second-named respondent, the effect of which was to thwart the operation of the final orders.

2. Again there is much force in those submissions.

Conclusion

1. Having regard to the above matters, I am satisfied that there are circumstances that justify an order for costs in favour of the applicant against the first and second-named respondents. 

2. I am satisfied that the first-named respondent did not comply with the final orders made on 7 October 2016, both in respect of the payment to the wife and the withdrawal of the caution.  It was that failure to comply with the final orders as noted above that gave rise to the initial Application in a Case seeking enforcement of those orders. 

3. I am further satisfied that the conduct of the first and second named respondents in executing documents the effect of which was to transfer the Suburb Y property from the first-named respondent to the second-named respondent was conduct the effect of which was to frustrate the operation of the final orders.

4. The first-named respondent has had notice of the applicant’s application to enforce the final orders since service of the original application on him in February 2017.  Similarly, the wife submits and I accept that the application was served on the second-respondent by email on 17 February 2017.  The only proposal put on behalf of the second-named respondent to resolve the matter was that contained in the letter from his lawyer to the wife’s lawyer dated 19 April 2017.  That letter was forwarded to the wife’s lawyer the day prior to the hearing, leaving little opportunity for the matter to be resolved prior to the hearing.  That the matter ultimately resolved by consent in my view, having regard to the history of the application, does not absolve the respondents from responsibility for the applicant’s costs.

5. Both the first and second named respondents submit that their parlous financial circumstances militate against an order for costs.  However, impecuniosity is of itself no bar to a costs order as otherwise an impecunious litigant would be free to pursue meritless applications at will (Lenova & Lenova (Costs) [2011] FamCAFC 141).

1. The applicant seeks an order that the first and second named respondent pay her costs of the applications and hearing on 20 April 2017 on a party-party basis.  Having regard to the above matters I am satisfied that an order in those terms is appropriate. 

2. Given that the application arises primarily as a result of the first-named respondent’s non-compliance with the final orders, it is my view that he should pay a greater proportion of the applicant’s costs.  Following the first-named respondent’s failure to make payments to the wife pursuant to the final orders by the due date, the second-named respondent executed transfer documents, the effect of which was to frustrate the wife’s enforcement of her rights under the final orders in circumstances where I am satisfied that he was aware of those orders.  Accordingly, having regards to the actions of the first and second-named respondents, in my view the first-named respondent should be responsible for 75 per centum of the assessed costs and the second-named respondent for 25 per centum of those costs.

3. Accordingly I order as follows:-

   (1)That the first-named respondent pay 75 per centum of the applicant’s costs of and incidental to the proceedings of 20 April 2018, the Application in a Case filed 10 February 2017, the Amended Application in a Case filed 10 February 2017 and the Amended Application in a Case filed 23 March 2017 (“the Proceedings”), such costs as agreed and in default of agreement as assessed on a party and party basis.

   (2)That the second-named respondent pay 25 per centum of the applicant’s costs of and incidental to the Proceedings, such costs as agreed and in default of agreement as assessed on a party and party basis.

I certify that the preceding eighty-three (83) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Johns delivered on 23 May 2018

Associate: 

Date:  23 May 2018