McG and McG (No.2)
[2002] FMCAfam 235
•28 August 2002
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| McG & McG (No. 2) | [2002] FMCAfam 235 |
| CHILD SUPPORT – Application for departure order. PRACTICE & PROCEDURE – Costs. Child Support (Assessment) Act, ss.100(1), 115(c), 117 |
| Applicant: | N B McG |
| Respondent: | J M McG |
| File No: | ZB6199 of 2001 |
| Delivered on: | 28 August 2002 |
| Delivered at: | Darwin |
| Hearing Date: | Written submissions |
| Judgment of: | Brown FM |
REPRESENTATION
| Counsel for the Applicant: | Mr Page S.C. |
| Solicitors for the Applicant: | Peter J Sheehy |
| Counsel for the Respondent: | Ms M Brennan |
| Solicitors for the Respondent: | Joseph Lyons & Co |
ORDERS
That the applicant pay the respondent’s costs pursuant to Part 21.10 and Schedule 1 of the Federal Magistrates Court Rules.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT BRISBANE |
ZB6199 of 2001
| N B McG |
Applicant
And
| J M McG |
Respondent
REASONS FOR JUDGMENT
Introduction
The respondent wife seeks an order for costs in her favour as a consequence of orders I made in the matter of McG & McG [2002] FMCA fam 71 on 5 April 2002. The proceedings related to an application brought by the husband for departures from the administrative assessment of child support in respect of the parties two children for the child support years from 1997/1998 to the present. The husband was unsuccessful in each of these applications. He also sought declarations that related to arrears of child support that arose as a result of “opt in” arrears calculated by the Child Support Agency. He was also unsuccessful in this application. In essence the husband sought that in substitution of the administrative assessments of child support payable by him that he should pay the sum of $75.00 in respect of child support for each of the children concerned.
I called for written submissions from each of the parties in respect of the issue of costs. The wife filed her submission on the 22nd of May, 2002. The husband filed his submission in response on the 12th of June, 2002.
The proceedings were commenced by the husband pursuant to Part 7 of the Child Support (Assessment) Act. As a consequence of section 100(1) of the Child Support (Assessment) Act orders in respect of costs in such proceedings are governed by the provisions of the Family Law Act and the Federal Magistrates Court Rules.
Section 117(1) of the Family Law Act provides that subject to subsection (2) and sections 117AA and 118, each party to proceedings under the Family Law Act shall bear his or her own costs. Section 117(2) provides that, if the Court is of the opinion that there are circumstances that justify the making of a costs order, such an order may be made subject to subsection (2A), as the Court considers just.
Sections 117AA and 118 are not relevant to the present considerations.
Section 117(2A) sets out the matters that the Court is required to have regard to in determining whether it is appropriate to make a costs order. The Court is required to 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, in accordance with section 117C or otherwise, made an offer in writing to the other party to the proceedings to settle the proceedings to settle the proceedings and the terms of any such offer; and
g)Such other matters as the court considers relevant.
I now turn to consider each of the matters as set out in section 117(2A).
Financial circumstances of each of the parties
The husband is a barrister. He estimated his income for the 2001/2002 financial year as being $125,000 to $140,000. His income for the relevant child support years is set out in paragraph 29 of the reasons for judgment of 5 April, 2002. In each year, apart from 2000/2001 he has earned in excess of $100,000. The husband is purchasing a house and owns some investments.
The wife returned to work in January of 2000. Prior to that time she was primarily concerned with caring for the parties two children. As a result she was entitled to claim social security payments. Currently she receives an income of $30,000 per annum. The wife is renting accommodation. She has modest assets.
On any view, the husband’s financial circumstances are markedly superior to those of the wife.
Legal Aid
Neither party is in receipt of legal aid. Accordingly, this is not a relevant consideration.
Conduct of the proceedings
There is no evidence to indicate that the manner in which either of the parties has conducted this litigation itself has resulted in one or other of them being put to greater cost.
True it is that the husband amended his form 63 application at a late stage, some three days prior to the matter being listed for hearing. The effect of this amendment was to include in the application for departure several child support years in which there had as yet been no administrative reviews. Pursuant to section 115(c) of the Child Support (Assessment) Act this is permissible where it is considered to be in the interests of all concerned to allow such a course. The wife did not object to this amendment. In fact, the wife sought to have the matter determined as expeditiously as possible. However, in her submissions in respect of costs the wife argues that the husband “elected to pursue the more expensive and adversarial resolution of these issues”. In light of the wife failing to object to the addition of the extra child support years to the application for departure and as a result of the fact that the arguments of each of the parties was essentially the same in respect of each child support assessment year, I do not believe that this is a relevant consideration in respect of the issue of costs.
The husband had earlier brought two appeals in form 64, which related to decisions of the Child Support Registrar. These decisions brought into existence the administrative assessment of child support from which the husband sought departure in the proceedings which took place before me. Justice Jerrard heard the two form 64 appeals and dismissed each of them. The husband subsequently appealed to the Full Court of the Family Court. On the 5th of November 2000 the Full Court determined that the appeals be adjourned so as to allow the applicant time to pursue the form 63 application. The Full Court reserved the question of the wife’s costs of and incidental to the appeal. As I understand matters, these appeals remain undetermined. Accordingly, the husband pursued the departure application.
In my view, the fact that the husband has commenced other proceedings which are related to the subject matter of the proceedings before me is not a relevant consideration to the question of costs in this matter. In my opinion, I must determine the question of costs solely by reference to the conduct of parties in respect of the form 63 application itself. The form 64 and the form 63 applications, though related in terms of the parties to them and their subject matter, are separate and distinct in relation to the determination of the issue of costs.
On the 13th of March 2001 the parties voluntarily attended a mediation convened with a view to seeing if the various matters between them could be resolved. These matters included the departure application and the appeal to the Full Court. The mediation was unsuccessful. This is not an uncommon phenomenon in all manner of proceedings brought in this Court and in the Family Court. In my view, it is not a relevant consideration to the conduct of either of the parties in respect of the question of costs.
The wife has argued that the husband has unduly delayed the departure application and its hearing. The initial departure application was filed on the 2nd of March 1999. Prior to that time, on the 9th of October 1998, the husband had commenced the form 64 proceedings in the Family Court at Brisbane. Jerrard, J. made orders in respect of these proceedings on the 8th of June 1999. It seems to be the case that it was thought appropriate by the Court at that time to deal with the appeals from the decision of the Child Support Registrar prior to the departure application. The husband lodged an appeal in respect of Jerrard J’s orders on the 9th of October 1999. As has already been indicated, the Full Court adjourned the appeals to allow the husband to pursue the departure applications. The departure applications were transferred from the Family Court to this Court on the 13th of September, 2001.
Thus there seems to have been some delay in the applications being dealt with. I am not certain whether this delay can be sheeted home to either one of the parties in particular. However, whatever the reason for the delay, I do not believe that it should form the basis for an award of costs in favour of the wife.
Whether the proceedings were necessitated by the failure of a party to comply with previous orders
This is not a relevant consideration in the present case. This was not a case that was precipitated as a result of the failure of one or other of the parties to comply with previous court orders. The Full Court of the Family Court in fact indicated that the departure application should be dealt with prior to the appeal from the decision of Jerrard J in the form 64 applications.
Whether any party to the proceedings has been wholly unsuccessful in the proceedings
It is the wife’s position that the husband has been wholly unsuccessful in each of his applications. As such, it is appropriate for the court to depart from the general rule that each party to proceedings should bear his or her own costs. The wife is critical of the husband’s actions in reducing the amount of child support he paid in respect of the two children concerned in February of 1998. This incident is described in paragraph 12 of the reasons for judgment herein dated the 5th of April 2002. This action of the husband ultimately lead to the wife seeking an administrative assessment of child support which in turn lead to the several proceedings concerning child support that have ultimately been commenced by the husband.
It is the wife’s position that the husband has been wholly unsuccessful in each of his applications. As such it is appropriate for the court to depart from the general rule that each party to the proceedings should bear his or her own costs.
The wife argues that the husband was at a significant advantage over her in commencing and pursuing these proceedings by dint of his profession as a barrister and his expertise gained as a Child Support Review officer. As such, she argues that he was in a position to know that it was unlikely that his application for a departure in the sum of $75.00 per week for each child concerned, over the several years in question would succeed. Accordingly, she says that in these circumstances, she is entitled to an award of costs.
The husband argues that he was not wholly unsuccessful in his applications in that he was able to establish that special circumstances existed to warrant a departure from each of the administrative assessments of child support. He argues that as the case turned solely on the exercise of the courts discretion as to whether it would be just and equitable or otherwise proper to depart from the administrative assessments concerned, it can not be said that he has been wholly unsuccessful in his applications and as such the general rule regarding costs as set out in section 117(1) should not be departed from.
In my view, the husband can not be criticised for commencing the proceedings simply because of his knowledge of the Child Support Scheme and the legal process. He is entitled to pursue his rights under the Child Support (Assessment) Act and to seek a departure in appropriate circumstances.
However, I do not accept that the husband has not been “wholly unsuccessful” in respect of his application. In my view, it is not appropriate to gauge the success or otherwise of a party in a child support departure application by how many of the three steps set out in section 117 of the Child Support (Assessment) Act have been satisfied. Section 117 must be read as a whole and each of the steps set out there must be satisfied before a departure application is granted. No one step is more important than the other two. In my view, the applicant was wholly unsuccessful in his application for the various departure orders, notwithstanding that I found that overall special circumstances existed to warrant a departure. I also reached this view in respect of the “opt in” arrears.
Conclusions
After having considered the provisions of section 117(2A) of the Family Law Act 1975, I have reached the conclusion that it is appropriate that the applicant pay the respondent’s costs in these proceedings. I have reached this view because of the vastly different financial circumstances of the parties and because the applicant has been wholly unsuccessful in his application for departure orders. In my view, these two factors justify that the Court departs from the general rule set out in section 117(1) of the Family Law Act 1975 in respect of costs. Accordingly, I propose to make an order that the applicant pay the respondent’s cost.
Pursuant to Part 21.10 of the Federal Magistrates Court Rules:
“Unless the Court otherwise orders, a party entitled to costs in a proceeding (other than a proceeding to which the Bankruptcy Act applies) is entitled to:
a)costs in accordance with schedule 1;
b)disbursements properly incurred.”
The scale of costs set out in Schedule 1 to the Federal Magistrates Court Rules is a fixed event bases scale. In my view, this is the appropriate method by which the respondent’s costs should be fixed. Accordingly, I order that the applicant pay the respondent’s costs pursuant to Part 21.10 and Schedule 1 of the Federal Magistrates Court Rules. I certify that pursuant to Part 21.15 of the Rules that it was reasonable for the respondent to employ an advocate at the final hearing of the matter.
I certify that the preceding twenty-eight (28) paragraphs are a true copy of the reasons for judgment of Brown FM
Associate:
Date:
0
0
0