McKenzie & Duncan and Anor (No.2) - [2011] FMCAfam 1211

FEDERAL MAGISTRATES COURT OF AUSTRALIA

MCKENZIE & DUNCAN and ANOR (No.2)

[2011] FMCAfam 1211

FAMILY LAW – Costs – application for payment on behalf of successful father against unsuccessful great-grandmother – consideration of relevant factors – costs ordered.

Family Law Act 1975, ss.117(1), (2), (2A)(a)-(g)

Applicant:

MS MCKENZIE

First Respondent:

MR DUNCAN

Second Respondent:

MS CAMPBELL

File Number:

CSC 633 of 2009

Judgment of:

Coker FM

Hearing date:

In Chambers

Date of Last Submission:

27 October 2011

Delivered at:

Townsville

Delivered on:

11 November 2011

REPRESENTATION

Applicant:

Self-represented

Solicitors for the First Respondent:

Roati & Firth

Second Respondent:

No appearance

ORDERS

That the applicant great-grandmother pay to the first respondent father his costs of and incidental to these proceedings fixed in the sum of $15,000, such payment, unless otherwise agreed in writing, to be effected by the applicant great-grandmother to the first respondent father or his legal representatives within 90 days of the date of this order.

IT IS NOTED that publication of this judgment under the pseudonym McKenzie & Duncan and Anor (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT TOWNSVILLE

CSC 633 of 2009

MS MCKENZIE

Applicant

And

MR DUNCAN

First Respondent

MS CAMPBELL

Second Respondent

REASONS FOR JUDGMENT

On 19 August 2011, I delivered reasons in this matter involving orders, with regard to the children [X], born [in] 1998, and [Y], born [in] 1999. The proceedings were not between the biological parents of those children, but rather between the biological father, Mr Duncan, and Ms McKenzie and her husband, who are the great-grandparents of the two children, the subject of the proceedings.
The children’s mother, Ms Campbell, was not, to any real degree, involved in the proceedings, though the orders that were made by me on 19 August 2011 included specifically an order to the effect that the mother be rejoined, as she had previously been a party to proceedings, and then discharged, as the second respondent, to the proceedings. The reason for that was elaborated upon in the reasons of 19 August 2011 and are not necessarily required to be further dealt with here.
The matter is now before the Court pursuant to the provisions of order 6 of those orders of 19 August 2011. Order 6 was in these terms:
6. That should there be any application for costs on the part of the Father then the Father be at liberty to file and serve any submissions in relation to same, within 28 days of the date of this order, and that the Respondent Great Grandparents have leave to file and serve any submissions in response within 42 days of the date of this order, and that unless otherwise requested in writing, that the determination of any such application proceed in chambers
Roati & Firth Lawyers, for the father, forwarded under cover of their letter of 12 September 2011, submissions on behalf of the respondent father in relation to the issue of costs. Clearly, therefore, the issue was live and was one which then required a response to be filed by the applicant great-grandmother or, as I indicated in the material, the applicant great-grandparents, within 42 days of the date of the order.
There was, however, some further communications between the applicant and the Court, as well as the legal representatives for the first respondent, and leave was granted because of issues with regard to health and the isolated nature of the applicant’s home, to allow material to be filed on or before 28 October 2011. Submissions were filed by the applicant on 27 October 2011.
Neither the solicitors for the first respondent, or the applicants, have requested that the matter be determined in Court, and accordingly, it is to proceed, as was the intent of the order, in chambers.
The position of the first respondent father is to say that there should be an order made for costs, as a result of the application failing to be successful in any way, shape or form. The submissions are made in accordance with consideration of those matters which are set out pursuant to the provisions of section 117 of the Family Law Act. Section 117 is in these terms:
Section 117 COSTS
117(1) [Party bears own costs] Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AB, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.
117(2) [Costs orders] 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) and (5) and the applicable Rules of Court, make such order as to costs and security for cots, whether by way of interlocutory order or otherwise, as the court considers just.
117(2A) [Matters relevant to costs order] 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.
Obviously, the starting point in relation to such matters is therefore to consider the general direction provided pursuant to section 117(1), in other words, that each party to proceedings under the provisions of the Family Law Act should bear his or her own costs.
The position of the applicant great-grandmother is to say that that is the appropriate course to follow in relation to the matter, and there is always, of course, that presumption that that is the proper position to take in relation to proceedings which are of such a nature as those which arise in relation to family law.
Of course, for every rule, there is an exception, and subsection (2) specifically provides that there is that discretion which falls upon the Court in circumstances where it is considered by the Court appropriate that there should be an order made for the payment of one party or the other’s costs, as a result of the proceedings before the Court.
The applicant for costs, the first respondent father, says that there are a number of bases upon which an order for costs should be made. They relate generally to the matters that are set out in subsection (2A) of section 117, which sets out the various matters that a Court shall have regard to in relation to proceedings.
In particular, the father says that the financial circumstances of the parties, coupled, I think, with those matters set out in section 117(2A)(c), the conduct of the parties to the proceedings, are relevant considerations in respect of the matter.
The father says that whilst he is in employment, he is by no means in a position where he is in a strong financial situation, and that the imposition that has arisen as a result of these proceedings has had an effect not only upon him, but also directly upon the children. It is an expense which the father suggests should not have been incurred in relation to these proceedings and that as a result of the proceedings, he and his family unit are in a far more precarious financial situation than would have been the case had proceedings, which were ultimately unsuccessful, not been brought.
The respondents, the grandparents’ position in relation to the matter, is to say that they are in, if anything, a worse financial situation than the father. They say that they are in receipt of a combined pension of approximately $35,000 per annum, and from that, they are required to meet all of the outgoings and expenses associated with their day-to-day living.
It is noteworthy, however, that the weekly living expenses of the great-grandparents as detailed in their own submissions, totals $625.21 per week, whilst the total amount that is received by them, by way of pension and other entitlements, is $669.69.
There is, therefore, a small window, perhaps only of 40 to 45 dollars per week which is available to the great-grandparents to provide for some assistance in relation to the costs incurred by the first respondent if it were deemed appropriate that there should be some payment made.
Quite simply, it is clear that both the father and the great-grandparents are by no means wealthy people, and the financial circumstances and therefore the burden that has been met, particularly by the father, he choosing, quite properly, to be legally represented in relation to such proceedings, has been enormous and is a factor which should properly be considered in relation to these proceedings.
The second of the factors that I said should be obviously considered conjointly, in relation to these proceedings, is the issue of the conduct of the parties to the proceedings. In a purely technical sense, the father has, in fact, throughout the proceedings, not been as precise in compliance with orders and directions as has been the great-grandparents, as indicated in their submissions, and I accept that it is correctly the case.
The great-grandparents have complied with each and every direction that has been made in relation to the matter. In particular, the submission was made, and it is quite proper, that all directions and timeframes were complied with by the great-grandparents in relation to the proceedings, whilst on the first day of hearing of the application brought by the great-grandparents, the Court was critical of the legal representatives for the father, in that they had failed precisely to comply with the orders in relation, to the filing and service of documents.
In a perfect world, that is a factor obviously to be considered in relation to the proceedings, but by the same token, whilst there was some criticism directed by me toward the legal representatives for the father in relation to the proceedings, it is not, I would think, a situation where he, through his actions has led to some situation where, in fact, the applicant great-grandmother was in some way impeded in relation to the proceedings.
In any event, the applicant great-grandmother did not take any exception in relation to the matter other than, of course, to point out the failure to comply precisely in relation to the proceedings but did indicate that there was no injustice or difficulty that would be caused to her in relation to the matter proceeding, on the day that was fixed.
It is clear, in my view, that whilst that technical point arises, the greater consideration here is the conduct, in relation to the proceedings, of a far more wide-ranging consideration. As section 117(2A)(c) precisely says, the consideration is the conduct of the parties to the proceedings in relation to the proceedings including, “without limiting the generality”. In other words, there is the opportunity open to consider all matters in relation to the proceedings, including, if you like, the motivations in respect of the matter.
There, there is in my assessment, a very real distinction that arises in relation to this matter and to this application for costs by the father, and it is one that falls heavily in favour of the father. The applicant great-grandmother was genuine in her desire to have a relationship with her great-granddaughters and to facilitate that relationship. It is noted in the judgment that there was a genuine desire on the part of the great-grandmother to spend time with the children, and it was also noted as genuine that there was a desire on the part of the great-grandmother to facilitate the opportunity for the two children the subject of these proceedings to have a relationship and to interact with their older sister, [Z].
However, there is also very clearly an indication that it was a genuine desire on the part of the applicant great-grandmother, but it was also a determination and a stance taken by the maternal great-grandmother, which was one motivated from a determination on her part, to get what she considered to be her right, in relation to a relationship between the two children and her, as was submitted on behalf of the father:
…the maternal great-grandmother was unconcerned at the detrimental impact that she was having in undermining the father’s family and undermining the father and Ms J’s parenting and relationship.
It was also clear and was strongly emphasised that the maternal great-grandmother had little, if any, respect for the father and for his partner and that there was no consideration whatsoever as to the impact upon the family unit both financially and emotionally, that being the family unit of the father, and the very serious consequences for the children of being put in a situation where serious concerns were raised in relation to the great-grandparents’ capacity to provide a safe and secure environment for the children, when the children were spending time with them, and it was also clear that notwithstanding the most overwhelming evidence in relation to concerns with regard to the mother’s relationship with the children and her capacity to provide for the children, that there was little if any recognition of the legitimacy of the concerns expressed by the father.
There was, if you like, a determined position taken by the maternal great-grandmother in relation to the proceedings, that her wishes and her “rights” to a relationship with the children, overrode any other considerations, including the far more significant matter of the children’s need for a settled, stable and secure environment and that that was only being provided by their father, as well as the determination to, in any real way, ignore the importance of the behaviours and conduct of the father, in ensuring that there was a settled and secure home and environment for these two girls.
The issue of conduct is, therefore, one which is far more wide ranging than just a consideration of compliance with directions and requirements in relation to proceedings. In my view, it requires a far more expansive consideration of issues with regard to the behaviours not only during the proceedings, but, of course, in relation to the application itself and to the effect on all concerned, and in that aspect or respect of the matter, there are serious concerns that arise in relation to the behaviours of the great-grandparents.
It is not necessary to consider issues with regard to the provision of legal aid, as it is clear that the applicant great-grandmother acted on her own behalf without legal assistance and certainly without any provision of funding to assist in relation to the issues before the Court. The father also was not able, for whatever reason, to avail himself of legal aid in relation to the proceedings and self-funded all such actions.
Again, of course, there is a factor, however, to be considered in that regard in that the financial circumstances of the parties both being dire means that the father as a result of his determination to have legal representation, has experienced a far greater financial impost as a result of these proceedings than has the applicant great-grandmother, other than those difficulties that are touched upon in submissions by the great-grandmother with regard to the cost of transportation to participate in these proceedings or, of course, generally to spend time with the children.
Subsection (d) requires there to be consideration of whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders. Here there were no specific final orders of any nature made in relation to the opportunity for the maternal great-grandmother and, of course, the great-grandfather to spend time with the children. There were, however, interim orders which made some provision for opportunities for time to be spent by the maternal great-grandparents with the children.
However, because of those financial considerations to which I have already previously referred, the cost of travel and the time involved in travel from [omitted] to [omitted], the orders, albeit of an interim nature, were not taken up by the maternal great-grandmother. In any event, it again is, in my view, not a matter in any way really determinative of these proceedings.
Interestingly, subsection (e) of section 117(2A) relates to whether one party has been wholly unsuccessful or, of course, wholly successful in relation to the proceedings. The perspective of the father is to say that as the great-grandmother in her application was seeking a number of orders primarily directed toward spending time with the children and no such orders were made in relation to the matter, she has been wholly unsuccessful in her application.
The submission is expanded upon by reference to provisions at paragraph 15 of the reasons for judgment which were given by me on 19 August 2011 where I said:
However, it is unfortunately a situation where I have rarely, if ever, experienced a situation or heard evidence which has given rise to such serious concerns as those that are held by me, in relation to the benefits to these children of spending any time, except that which is agreed to by the father, with the maternal great-grandparents.
The emphasis placed upon such a statement in the reasons is clear, in that the attitudes and behaviours of the great-grandparents, both during the proceedings but, it would seem, also in general interactions with the father, are such that there was little prospect of success and that therefore the finding that was made, in other words, that the great-grandparents were not to have any specific orders in relation to time to be spent with the children, other than that which might be facilitated by agreement with the father, shows that they were wholly unsuccessful in the proceedings.
The applicant great-grandmother’s position was to say that they had other indicators which would show that it was proper that they should pursue some relationship with the children. Emphasised on the part of the applicant great-grandmother, and it is quite an appropriate emphasis in the circumstances, is the fact that a family report was obtained in relation to the matter, and the reporter did strongly recommend that there should be time spent by the children with the great-grandparents and, by extension, other members of the maternal side of the family.
It explains much of the attitude, in relation to the matter and the determination on the part of the applicant great-grandmother to press ahead in relation to seeking orders in relation to this matter. If anything, it is a factor which in my assessment does provide support for the position of the applicant great-grandmother, because although ultimately unsuccessful in relation to orders sought in relation to the proceedings, it is also clear that it was not simply a frivolous or malicious intent on the part of the applicant great-grandmother to seek orders in relation to this matter but was at least in part a reflection of the recommendations of an independent person preparing a report, in relation to the proceedings.

I am not at all satisfied, therefore, that whilst the great-grandmother was wholly unsuccessful in obtaining orders in relation to this matter, that it automatically would suggest that there should be orders made in favour of the father.
Significant also in relation to the proceedings, however, are those matters which are set out in section 117(2A)(f) relating to whether any offers were made. It is noteworthy that offers were made in relation to the proceedings, and it is conceded, quite properly, on the part of the applicant great-grandmother that there were offers made with regard to spending time with the children in the [omitted] district.
The fact is that the applicant great-grandmother and, by extension, the maternal side of the family rejected such a proposal in light of the extensive travel that would be required, as well as costs for petrol and other expenses, but it is also noteworthy, of course, that the offer was made which was in the end significantly greater, in that there would be certainty as to such times as might be spent by the great-grandparents with the children, than is now the case in relation to spending any time with the children, other than that which is agreed.
An offer to settle in relation to proceedings is a significant factor to be considered in relation to any issue of costs, and it is a matter which I must say weighs heavily in favour of the father, in relation to the application for an order for costs.
Generally, therefore, the positions by each of the parties is diametrically opposed. The father says that he has incurred enormous expense in relation to these proceedings. A schedule of costs annexed to his submissions details professional fees and disbursements in the sum of $22,282.25. They include significant amounts with regard to travel on the part of the father’s legal representatives, noting five occasions at a rate of $495.00 as well as counsel’s fees of $5,500.00 inclusive of GST.
Additionally, there are significant amounts claimed in relation to service fees and conduct money associated with the issue of subpoenas and the like such that the figure of $22,282.25 is in fact inclusive of an amount of approximately $9,000.00 with regard to those additional expenses.
Whilst they are obviously fees to be incurred in relation to proceedings, it is not necessarily an indication of the expenses that could properly have been incurred in relation to the proceedings and reflective of the costs of the father generally.
Of course, the determination as to whether costs should be paid, and if to be paid by one party to the other, the quantum of such costs, is a matter that is open to the discretion of the Court.
Here, I am of the view that there should be some consequence for the proceedings that were brought in relation to the matter. There was a very determined stance taken by the applicant great-grandmother in relation to the proceedings, and in that regard, I am particularly mindful of the fact that, at the conclusion of the first day’s hearing, and there was a significant space between the first day of hearing and the second day of hearing, some eight or nine weeks, there was a clear indication of concerns that arose as a result of the evidence that had so far fallen, in relation to the proceedings.
Notwithstanding that, however, there was a general refusal to consider what might be seen to be the ultimate outcome of the proceedings in relation to this matter and, of course, with a determination to proceed, notwithstanding limited prospects and indications of limited prospects of success, is an obligation to meet the costs consequences that flow from that.
I am of the view that this is one of those instances where there should be a consequence for the proceedings. I am also, however, mindful of the fact that whilst perhaps misguided and ill-conceived, there was a genuine desire on the part of the applicant great-grandmother to spend time with the children, though unfortunately there was little appreciation of the real issues of concern that arose particularly with regard to unrestrained and controlled interaction with the mother, and it was certainly found that that was a real prospect whilst the children remained in the great-grandparents’ care at any time, but also concerns with regard to, if you like, a lack of appreciation on the part of the great-grandmother in particular of the behaviours of the older child, [Z], who was, at least at the time of the first proceedings, in the care of the great-grandparents.
There must be a consequence, but there must also be an appreciation of those matters which relate to the financial circumstances of both parties. Costs is not a punitive act to be taken in relation to an unsuccessful application.
The starting point, as I indicated, is a presumption that each parent or party to proceedings will bear his or her own costs, but there must also, of course, be a recognition that in certain instances where a determined stance is taken by a party to proceedings, then there must be a consequence in relation to same. I am of the view here that there must be a consequence in relation to these proceedings and that it is proper that that should perhaps be a reflection of two-thirds of the costs and disbursements that have been claimed in relation to the proceedings. In my view, it is appropriate that there should be an order for costs, and I intend to make such an order. The order will be:
That the applicant great-grandmother pay to the first respondent father his costs of and incidental to these proceedings fixed in the sum of $15,000, such payment, unless otherwise agreed in writing, to be effected by the applicant great-grandmother to the first respondent father or his legal representatives within 90 days of the date of this order.

I certify that the preceding fifty (50) paragraphs are a true copy of the reasons for judgment of Coker FM

Date: 11 November 2011