Millwood and Millwood (Costs)
[2017] FamCAFC 100
•1 June 2017
FAMILY COURT OF AUSTRALIA
| MILLWOOD & MILLWOOD (COSTS) | [2017] FamCAFC 100 |
| FAMILY LAW – APPEAL – APPLICATION IN AN APPEAL – COSTS – Where the mother seeks her costs of an application brought by the father and concluded by consent orders – Where the consent orders included orders allowing the appeal and setting aside final parenting orders but did not include interim orders to govern the father’s time with the child until the remitted proceedings are reheard – Where it is controversial as to whether the parties reached an agreement as to interim orders – Where an application by the father to set aside or amend the consent orders was resolved by the agreement of the parties – Where the mother seeks her costs of that application – Financial circumstances of the parties – Conduct of the proceedings – Whether the father was wholly unsuccessful in the proceedings – Application dismissed – Parties to bear their own costs of the application. |
| Family Law Act 1975 (Cth) s 117 Family Law Rules 2004 (Cth) r 17.02 |
| Millwood & Millwood [2017] FamCAFC 35 |
| APPLICANT: | Ms Millwood |
| RESPONDENT: | Mr Millwood |
| INDEPENDENT CHILDREN’S LAWYER: | Rowley & Associates |
| FILE NUMBER: | MLC | 9337 | of | 2014 |
| APPEAL NUMBER: | EA | 123 | of | 2016 |
| DATE DELIVERED: | 1 June 2017 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | In chambers |
| JUDGMENT OF: | Aldridge J |
| HEARING DATE: | Heard by way of written submissions: filed by the applicant on 13 April 2017 and the respondent on 24 April 2017 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Australia |
| LOWER COURT JUDGMENT DATE: | 8 July 2016 |
| LOWER COURT MNC: | [2016] FCCA 1660 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr O’Ryan QC |
| SOLICITOR FOR THE APPLICANT: | Milevski Family Lawyers |
| COUNSEL FOR THE RESPONDENT: | Mr Sansom SC |
| SOLICITOR FOR THE RESPONDENT: | Smythe Wozniak Lawyers |
| SOLICITOR FOR THE INDEPENDENT CHILDREN’S LAWYER: | Ms Rowley |
Orders
The mother’s application for costs of and incidental to the proceedings concluded by consent orders on 30 March 2017 is dismissed.
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 Millwood & Millwood (Costs) 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).
| IN THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 123 of 2016
File Number: MLC 9337 of 2014
| Ms Millwood |
Applicant
and
| Mr Millwood |
Respondent
and
Independent Children’s Lawyer
REASONS FOR JUDGMENT
Ms Millwood (“the mother”) seeks an order that Mr Millwood (“the father”) pay her costs of and incidental to “the proceedings that were concluded by consent orders” made on 30 March 2017. The Independent Children’s Lawyer (“the ICL”), who was also a party to the proceedings, did not seek a costs order.
On that day, by consent, I dismissed the father’s Application in an Appeal filed on 23 March 2017, which sought interim parenting orders consequent upon orders made by me on 7 March 2017, by which I allowed the appeal and set aside parenting orders made by Judge Dunkley on 8 July 2016. The basis of the father’s Application in an Appeal was that the agreement between the parties that led to a joint approach to the Court to allow the appeal had included interim orders that would operate until the remitted proceedings came before the Federal Circuit Court of Australia, but that those orders had not been made. The mother disputed that this was the agreement.
Background
In order to understand the proceedings and to determine the mother’s application for costs, it is necessary to set out a detailed chronology.
The parties were married on in 2005 and separated in 2014. They had one child (“the child”) who was born in 2011.
It was the case of the mother before the primary judge that the father posed an unacceptable risk of harm to the child. The father denied that this was so.
On 8 December 2014 the primary judge made an interim order that the child live with the mother and spend time each Monday and Friday with the father, supervised at a specified contact centre.
The final hearing commenced on 21 July 2015 and continued over the following three days and 13 August 2015. The hearing resumed on
26 October 2015, continued through to 28 October 2015 and concluded on
25 November 2015. Final written submissions were received on
22 December 2015.
On 8 July 2016 the primary judge made the following orders:
(1)All prior parenting orders are discharged.
(2)The parties shall have equal shared parental responsibility for [the child] born … 2011.
(3)[The child] shall live with her mother.
(4)[The child] shall spend time with her father:
(a)For 3 out of 4 Saturdays from 10am to 4pm commencing the 2nd Saturday after the making of these orders.
(b)For 3 out of 4 Sundays from 10am to 4pm commencing the 2nd Sunday after the making of these orders.
(5)If the father obtains from a registered assessor an assessment that his risk of recidivism for sexual assault of a child is low, then [the child] shall spend time with her father:
(a)During school term time each alternate weekend from after school Friday until before school Monday commencing the first weekend of each school term.
(b)For the first half of the Term 1, 2 and 3 school holidays from 9am on the first Saturday to 5pm on the middle Sunday.
(c)For half of the Term 4 school holidays being the first half in years ending in an odd number and the second half of years ending in an even number or zero.
(d)At such other times as the parties agree.
(6)For the purpose of order 4 changeovers shall occur in a supervised setting at a contact centre agreed upon by the parties and paid for equally by the parties or by use of a professional supervising service equally paid for by the mother and father unless they agree alternate arrangements.
(7)For the purpose of order 5 where changeover cannot occur at [the child]’s school it shall be conducted by a professional supervising service equally paid for by the mother and father unless they agree alternate arrangements.
(8)The father is restrained from being in the presence of [the child] when she is bathing, toileting or changing clothes.
(9)The mother is restrained from allowing or causing [the child] to consult [Ms C] or any other sexual assault counsellor about incidents the focus of these proceedings.
(10)The mother shall complete psychological counselling for her anxieties regarding [the child].
(11)That both the mother and father take all steps to engage in and complete a multi session parenting after separation course as nominated by the Independent Children’s Lawyer.
(12)Each parent shall notify the other parent of any medical treatment or allied health care treatment received by [the child] whilst in that parent’s care.
(13)The father shall pay to the mother by way of property settlement on or before sixty days from the date hereof the sum of $242,889.
(14)If order 13 is not complied with by the due time, the property at [D Street, Suburb E] shall be sold by private treaty by a real estate agent jointly appointed by the parties.
(15)On completion of the sale, the sale proceeds shall be disbursed as follows:
(a)In payment of agents commission, costs and expenses.
(b)In payment of conveyancing costs and expenses.
(c)In repayment of the 2 mortgages to the ANZ Bank for which the husband and wife have joint responsibility.
(d)In payment to the mother of $242,889 plus interest calculated pursuant to the rules for the period after the expiry of 60 days from the date of judgment until the date of payment.
(e)In payment of the balance to the father.
(16)That the husband and wife do all acts and things and give all consents and execute all documents and writings necessary to give effect to the orders made herein.
(17)That in the event that either party refuses or neglects to execute any deed or instrument within fourteen (14) days of being requested to do so then the Registrar of the Court be appointed pursuant to section 106A to execute such deed or instrument in the name of such party and to do all acts and things necessary to give validity to the operation of the deed or instrument.
(18)The husband shall be responsible to repay the ANZ mortgage securing the loan borrowed in his sole name.
(19)The wife shall be responsible to repay her two residential home loans and her capital gains tax liability.
(20)It is ordered that subject to the preceding the husband and wife are to have the sole right, title and interest in:
(a)Any chattels, goods, furnishings, real estate and other property not previously dealt with as part of these orders which are, at the date hereof in their possession respectively;
(b)Any monies, shares, debentures and superannuation entitlements not previously dealt with as part of these orders which stand in their sole name respectively at the date hereof.
(21)Pursuant to S.65DA(2) and S.62B, the particulars of the obligations these orders create and the particulars of the consequences that may follow if a person contravenes these orders and details of who can assist parties adjust to and comply with an order are set out in the Fact Sheet attached hereto and these particulars are included in these orders.
(22)All outstanding Applications and Responses are removed from the list of cases awaiting finalisation.
On 5 August 2016 the father filed a Notice of Appeal, appealing against all of the orders made by the primary judge except for Order 1.
On 21 February 2017 the mother filed an Application in an Appeal. One of the orders sought by her was leave to file a Notice of Cross‑Appeal out of time. The mother sought to appeal against Orders 2, 4 and 5 of the primary judge’s orders. She sought, as did the father, an order that in the event the appeal was successful the matter be remitted for rehearing.
Thus both the mother and the father appealed against the making of Orders 2, 4 and 5.
The mother’s Application in an Appeal was listed for hearing before me on 7 March 2017. On that day the mother was represented by Mr Dura of counsel and the father was represented by Mr Gould of counsel (who were not the counsel who subsequently appeared in the father’s Application in an Appeal seeking to set aside my earlier orders).
The ICL also appeared.
The Court was informed that each of the Application in an Appeal, the appeal and proposed cross-appeal had been resolved. The Court was handed a Minute of Order and the following orders were made in accordance with it:
By consent, the parties agree:
(1)That leave be granted to the respondent to file a Notice of Cross-Appeal out of time.
(2)That the respondent/cross-appellant file and serve her Summary of Argument and List of Authorities in respect of the Appeal and Cross-Appeal by 7 April 2017.
(3)That the appellant/cross-respondent file and serve his Response to the respondent/cross-appellant Summary of Argument by 5 May 2017.
(4)The Independent Children’s Lawyer file and serve their Summary of Argument and List of Authorities by 26 May 2017.
Orders 2 to 4 of those orders were immediately rendered inconsequential by what occurred subsequently.
The Court was then provided with a Minute of Order which provided for both the appeal and the cross-appeal to be allowed, Orders 1 to 12 made by the primary judge to be set aside, the matter to be remitted to the Family Court of Australia in Sydney for rehearing and that there be orders for costs certificates in respect of the appeal and the rehearing pursuant to the Federal Proceedings (Costs) Act1981 (Cth).
I pointed out to the parties and the ICL that I could not make an order remitting the matter to the Family Court of Australia because it was an appeal from the Federal Circuit Court and if the matter were to be remitted it would have to be remitted to that court. No one raised any opposition to that course.
I then proceeded to hear submissions from the parties as to why there was an error of law that would justify there being an order that the appeal be allowed and the matter be remitted for rehearing. Unsurprisingly, the parties concentrated on Order 5 made by the primary judge. I accepted those submissions and in some short reasons expressed at the time I indicated that Order 5 was an order that could not, and should not, have been made (Millwood & Millwood [2017] FamCAFC 35 at [4] – [7]). Accordingly, being satisfied that there was an error on the part of the primary judge, on the application of both parties I made the following orders:
On the application of both parties:
(1)That the Appeal filed by the appellant father on 5 August 2016 be allowed.
(2)That the Cross-Appeal filed by the cross-appellant mother on
7 March 2017 be allowed.(3)That the Orders 1 to 12 (inclusive) of the Orders of the Federal Circuit Court made on 8 July 2016 be set aside.
(4)That the proceedings be remitted for re-hearing to the Federal Circuit Court of Australia at Sydney.
(5)That there be no order as to costs.
(6)The Court grants to the appellant/cross-respondent husband a costs certificate pursuant to s 9 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by her in relation to the appeal.
(7)The Court grants to the respondent/cross-appellant wife a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by him in relation to the appeal.
(8)The Court grants to each of the parties a costs certificate pursuant to the provisions of s 8 of the Federal Proceedings (Costs) Act1981 (Cth) being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to each of the parties in respect of the costs incurred by them in relation to the new trial ordered.
The effect of those orders, of course, was that the interim orders of 8 December 2014 were re-enlivened, there being no other operative orders.
Accordingly, the mother took the view that as that was the case, the father was not entitled to unsupervised time with the child and she was not prepared to agree to it or to vary those orders in any way. The father’s solicitor’s response was to write a letter to the wife’s solicitors on 10 March 2017 in which it was said, incorrectly it would seem:
The orders of Judge Dunkley dated 8 July 2016 have not been discharged … The Appeal orders do not operate to stay the Orders dated
8 July 2016.The parties then turned to the ICL who, in a letter dated 14 March 2017, said:
I now appreciate the effect of His Honour having made that Order is that all prior parenting Orders have been discharged … I did not understand this to be the common intent of the parties when this matter was before the Honourable Justice Aldridge. It was not my intent that this be the outcome.
On 22 March 2017 Mr Gould swore an affidavit setting out his recollection of the contents of the negotiations with Mr Dura. This affidavit was provided to the father’s lawyers. In short, his evidence was that there had been a discussion between the two of them as to what orders were to govern the parenting arrangements for the parties’ child between 7 March 2017 and the time the proceedings are reheard in the Federal Circuit Court of Australia. He asserted that he proposed, and counsel for the mother agreed, that although the orders made by Judge Dunkley on 8 July 2016 should be set aside, they should nonetheless be remade as interim orders until the matter again came before the Federal Circuit Court.
He did not explain why it was that he then asked me to make, and why he made submissions in support of, the orders set out in the short Minute of Order handed up, which plainly made no reference to any interim orders whatsoever. He did, however, assert that when he returned to chambers he was surprised to realise that no interim orders had been made.
The service of the affidavit of Mr Gould was met with a denial by the mother’s lawyers that the issue of interim orders had been raised between counsel. By inference, therefore, there was an apparent and most unfortunate disagreement between counsel as to the contents of the agreement that led to the resolution of the appeal. Regrettably, Mr Dura did not inform Mr Gould with his version of the discussions, which is what one would have expected of counsel in that position.
On 23 March 2017 the father filed an Application in an Appeal seeking the following orders:
1.That the orders purporting to be made on the Application of both parties herein on 7 March 2017 and in particular order 3 which order provides “that the orders 1 to 12 (inclusive) of the orders of the Federal Circuit Court made on 8 July 2016 be set aside” be varied such that so far as those orders relate to the child’s unsupervised time with the father, such orders continue until the completion of the rehearing and the delivery of orders and Reasons for Judgment therein.
2.That the above order be made in order to correct and regularise the record or in the alternative to reflect the mistake made on 7 March 2017.
3.That orders made as to the filing and serving of Summary of Arguments (orders 2, 3 and 4 made on 7 March 2017) be discharged as erroneous and in the circumstances of the subsequent orders which were made as to the allowing of the Appeals, otiose.
That application was listed before me on 30 March 2017. If that application were to proceed to a hearing, it would be necessary for the Court to determine whether or not counsel for the father’s version of the settled negotiations was correct and if so what was the effect of such negotiations. That, no doubt, would have involved at least both counsel giving evidence and then being cross-examined.
The Application in an Appeal must also be seen in the context not only of both parties agreeing that the orders of the primary judge were fatally flawed and ought to be set aside, but the Court also accepting that this was so. Both parties had joined in persuading me that, at the least, Order 5 of the primary judge’s orders should never have been made.
The consequence of finding that there had been no agreement as to interim orders could well have the effect that there was no agreement at all as to making a joint approach to the Court to allow the appeal. The consequence of that is that the orders of 7 March 2017 would be susceptible to being set aside. In turn, that would lead to a revivified appeal, which both parties supported and which would, in my opinion, clearly be allowed.
The father could have but did not approach the Federal Circuit Court seeking an urgent hearing to obtain interim orders.
The plain reality is that the parties needed to turn their minds to the parenting arrangements that would apply if the orders of 8 July 2016 were set aside. At the very least, if they could not agree on those arrangements, they needed to agree on a process to resolve the impasse. That was the position on 7 March 2017 and remained the position on 30 March 2017.
Faced with these undeniable realities and assisted by senior counsel now appearing for each of them, the parties eventually agreed upon some interim parenting orders which they proposed to ask the Federal Circuit Court to make. It was in that context that the father’s Application in an Appeal filed 23 March 2017 was dismissed.
It is appropriate at this stage to deal with the stance taken by the mother both before and after the Application in an Appeal was filed, which was that as the appeal had been allowed and an order made for remission of the hearing the Court was functus officio and it could do no more. To the extent that the Court had exhausted its power on the determination of the appeal, that is so. However, as the submissions of Queen’s Counsel for the mother accepted, there was scope for the consideration of the father’s application under r 17.02 of the Family Law Rules 2004 (Cth) (“the Rules”) or the inherent (or perhaps more correctly, implied) jurisdiction of the court.
The end result of this unfortunate series of events is that the mother seeks the costs associated with the father’s Application in an Appeal filed on 23 March 2017.
The mother’s application for costs
Turning now to the present application, the general position is that each party to proceedings under the Family Law Act 1975 (Cth) (“the Act”) is to bear their own costs unless there are circumstances that justify a different order (s 117). The mother relied on the following circumstances:
·The financial circumstances of the parties to the proceedings (s 117(2A)(a));
·The conduct of the parties to the proceedings (s 117(2A)(c));
·Whether any party to the proceedings has been wholly unsuccessful in the proceedings (s 117(2A)(e)).
As to the parties’ financial circumstances, I did not receive a financial statement from either of the parties, but the evidence that was before the primary judge in relation to property matters would indicate that both parties have significant assets. Even if it be true, as the mother submits, that she has a lower income than the father and also has the care of the child, she accepts that she has greater assets. I note that both parties were able to afford to engage senior counsel on the hearing of the final Application in an Appeal. I do not consider that the financial circumstances of the parties assists in determining the present application.
The mother submits that the conduct of the father in relation to the proceedings justifies an order for costs. She submits that the application made by the father was doomed to fail because it in fact did not rely upon the inherent jurisdiction of the Court but on the slip rule under r 17.02 of the Rules. Such an application must have failed because the facts were controversial.
I disagree. Had the evidence established that there had in fact been an agreement as to interim orders, there was scope for the application of r 17.02. If there was no agreement at all there was scope for the setting aside of the orders.
The father’s application was supported by the evidence of Mr Gould. It was therefore an arguable application.
It is startlingly obvious that, at some stage, the parties would need to turn their minds to the issue of what parenting orders would operate between the allowance of the appeal and the return of the matter in the Federal Circuit Court. It is most surprising that it was not agreed before the consent orders were made allowing the appeal.
The father’s case was that there was such an agreement but it was not recorded in the Minutes presented to the Court by his counsel. The wife’s position was that there was no such agreement and therefore the earlier orders came back into operation. That controversy has not been resolved.
In Re the Minister forImmigration and Ethnic Affairs of the Commonwealth of Australia; Ex Parte Lai Qin (1997) 186 CLR 622 McHugh J said at 624 – 625:
6. In most jurisdictions today, the power to order costs is a discretionary power. Ordinarily, the power is exercised after a hearing on the merits and as a general rule the successful party is entitled to his or her costs. Success in the action or on particular issues is the fact that usually controls the exercise of the discretion. A successful party is prima facie entitled to a costs order. When there has been no hearing on the merits, however, a court is necessarily deprived of the factor that usually determines whether or how it will make a costs order.
7.In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties. To do so would burden the parties with the costs of a litigated action which by settlement or extra-curial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action. In administrative law matters, for example, it may appear that the defendant has acted unreasonably in exercising or refusing to exercise a power and that the plaintiff had no reasonable alternative but to commence a litigation. Thus, for example, in
R v Gold Coast City Council; Ex parte Raysun Pty Ltd, the Full Court of the Supreme Court of Queensland gave a prosecutor seeking mandamus the costs of the proceedings up to the date when the respondent Council notified the prosecutor that it would give the prosecutor the relief that it sought. The Full Court said that the prosecutor had reasonable ground for complaint in respect of the attitude taken by the respondent in failing to consider the application by the prosecutor for approval of road and drainage plans.
8.Moreover, in some cases a judge may feel confident that, although both parties have acted reasonably, one party was almost certain to have succeeded if the matter had been fully tried. This is perhaps the best explanation of the unreported decision of Pincus J in
South East Queensland Electricity Board v Australian Telecommunications Commissionwhere his Honour ordered the respondent to pay 80 per cent of the applicant's taxed costs even though his Honour found that both parties had acted reasonably in respect of the litigation. But such cases are likely to be rare.
9.If it appears that both parties have acted reasonably in commencing and defending the proceedings and the conduct of the parties continued to be reasonable until the litigation was settled or its further prosecution became futile, the proper exercise of the cost discretion will usually mean that the court will make no order as to the cost of the proceedings. This approach has been adopted in a large number of cases.
I am unable to infer from the dismissal of the father’s application of itself that he has acted so unreasonably as to attract a costs order.
The real dispute between the parties was not whether the appeal should be allowed, the orders set aside and the matter sent back for a retrial, but what interim orders ought be in place pending the matter again coming before the Federal Circuit Court.
Sadly, the parties did not attempt sensibly to resolve that issue once they became aware of the problem. Rather, each adopted a stance and sought to defend it. The issue as to interim orders was resolved by agreement between the parties on 30 March 2017 when the parties successfully agreed upon an interim parenting arrangement. There was, therefore, utility in the father’s application, although, of course, a more obvious course the parties could have taken was to have approached the Federal Circuit Court.
I do not consider that the conduct of the proceedings supports the making of a costs order.
Finally, it is correct to say, as the mother asserted, that the application was wholly unsuccessful in that it was dismissed. As I have said, that must be seen in the light of the underlying agreement as to interim orders.
The prima facie position under s 117(1) of the Act is that the parties are to bear their own costs of proceedings. I am unable to resolve the underlying controversy as to whether or not there was an agreement between the parties as to the appropriate interim arrangements for the child, which was not reflected in the orders made on 7 March 2017.
I consider that there was substance to the Application in an Appeal filed on 23 March 2017, notwithstanding that the underlying dispute as to what was agreed between counsel was never resolved.
Whilst that application was ultimately dismissed on 30 March 2017, the parties did on that day agree to appropriate interim parenting orders.
Taking all these matters into account I am not satisfied that there are circumstances that justify a costs order. The application for costs is dismissed.
I certify that the preceding fifty (50) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Aldridge delivered on 1 June 2017.
Legal Associate:
Date: 1 June 2017
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