Morishita & Vartanian (No 2) - [2024] FedCFamC1F 618

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 1)
Morishita & Vartanian (No 2) [2024] FedCFamC1F 618

File number(s): CAC 1369 of 2021

Judgment of: GILL J

Date of judgment: 17 September 2024

Catchwords: FAMILY LAW – COSTS – Where the mother sought costs as agreed or as assessed until an offer of settlement was made and then on an indemnity basis at a fixed sum until delivery of the substantive judgment – Where the father pursued an unmeritorious case and correctly concedes he was wholly unsuccessful in relation to parenting matters – Where the father’s testing of the mother’s parenting position was still warranted – Where the father’s non-disclosure meant the mother was not fully aware of his financial circumstances when negotiating settlement – Where the mother made multiple offers better than the final outcome which the father did not respond to – Father to pay the mother’s costs on a party-party basis from the commencement of proceedings until the delivery of the substantive judgment

Legislation:
Family Law Act 1975 (Cth) – s 117

Federal Circuit and Family Court of Australia (Family Law) Rules 2021

Cases cited:
Colgate Palmolive Co and Another v Cussons Pty Ltd (1993) 118 ALR 248

Hawkins & Roe [2012] FamCAFC 77

Higginbotham & Robinson (1991) FLC 92-209

In the Marriage of W P J Munday and H J Bowman (1997) 22 Fam LR 321

Kohan & Kohan (1993) FLC 92-340

Lenova v Lenova (Costs) [2011] FamCAFC 141

Medlon & Medlon (No 6) (Indemnity Costs) (2015) FLC 93-664

Orioli v Oriolo [1985] FamCA 54

Penfold v Penfold (1980) 144 CLR 311

Quickley & Pelissier [2016] FamCAFC 124

Roydon & Roydon [2023] FedCFamC2F 1265

SVG v KLD [2015] FamCA 687

Division: Division 1 First Instance

Number of paragraphs: 90

Date of hearing: 6 August 2024

Place: Heard in Canberra, delivered in Sydney

Counsel for the Applicant: Ms Tonkin

Solicitor for the Applicant: Neilan Stramandinoli Family Law

Solicitor for the Respondent: Mr Lee, Gabbedy Milson Lee
ORDERS

CAC 1369 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:
MS VARTANIAN

Applicant

AND:
MR MORISHITA

Respondent

ORDER MADE BY:

GILL J

DATE OF ORDER:

17 SEPTEMBER 2024

THE COURT ORDERS THAT:
1.The respondent father pay the applicant mother’s costs of, and incidental to, the substantive proceedings from the commencement of the proceedings initiated by the father on 28 June 2021 up to and including the delivery of the substantive judgment in these proceedings on a party and party basis as agreed or as assessed.
2.The costs be paid to the mother by the father within 14 days of the total sum being determined, into a bank account nominated in writing by the mother.

Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2024] FedCFamC1F 618
Decision Date: 17 September 2024

CaseChat Overview and Summary

The matter between Ms Vartanian and Mr Morishita, a family law dispute, was heard and determined by Gill J in the Federal Circuit and Family Court of Australia. The primary issue was the allocation of costs between the parties, with the mother seeking costs on a party-party basis until the offer of settlement and then on an indemnity basis, and the father contesting the indemnity costs. The mother argued that the father's failure to accept her settlement offers, his unmeritorious pursuit of the parenting case, and his non-disclosure of financial information warranted indemnity costs. The father, on the other hand, argued that his actions did not merit such a severe penalty.

The court considered the nature of the father's conduct, including his unmeritorious case and the lack of disclosure, but concluded that these factors did not reach the level of extremity required for an indemnity order. The court noted that even though the father's actions were imprudent, they did not warrant more than party and party costs. The court also acknowledged the mother's multiple offers that the father did not respond to, and his overall lack of success in the parenting matters. Despite these considerations, the court held that the father's testing of the mother's parenting position was still warranted and did not justify indemnity costs.

Following its reasoning, the court ordered the father to pay the mother's costs on a party and party basis from the commencement of the proceedings up until the delivery of the substantive judgment. The court emphasised that the father's defaults in relation to disclosure and his unmeritorious case, while significant, did not elevate the situation to the level necessary for an indemnity order. The court also noted the mother's multiple offers which the father failed to accept, and the father's overall lack of success in the parenting matters. However, these factors were not deemed sufficient to warrant indemnity costs. The court's decision balanced the need for accountability with the principle that not all imprudent actions warrant the most severe financial penalties. The court's final orders reflect this balance, with the father to pay the mother's costs on a party and party basis.

Orders

Orders of the court

CAC 1369 of 2021

FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)

BETWEEN:

MS VARTANIAN

Applicant

AND:

MR MORISHITA

Respondent

ORDER MADE BY:

GILL J

DATE OF ORDER:

17 SEPTEMBER 2024

THE COURT ORDERS THAT:

1. The respondent father pay the applicant mother’s costs of, and incidental to, the substantive proceedings from the commencement of the proceedings initiated by the father on 28 June 2021 up to and including the delivery of the substantive judgment in these proceedings on a party and party basis as agreed or as assessed.

2. The costs be paid to the mother by the father within 14 days of the total sum being determined, into a bank account nominated in writing by the mother.

Note: The form of the order is subject to the entry in the Court’s records.

Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).

Part XIVB of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish an account of proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

The failure to accept the offers made, even if imprudent, is not of such an extreme character to warrant more than party and party costs, noting the observation in Kohan that, in this jurisdiction the effect of an imprudent rejection of an offer is generally no more than party and party costs. Even taking into account the father’s defaults in relation to disclosure, and his pursuit of an unmeritorious parenting case, and considering the parties’ financial circumstances, such matters together do not arise to the level of extremity required for an indemnity order.Conclusion Orders will be made for the father to pay the mother’s costs on a party and party basis from the commencement of the proceedings.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

File number(s):	CAC 1369 of 2021
Judgment of:	GILL J
Date of judgment:	17 September 2024
Catchwords:	FAMILY LAW – COSTS – Where the mother sought costs as agreed or as assessed until an offer of settlement was made and then on an indemnity basis at a fixed sum until delivery of the substantive judgment – Where the father pursued an unmeritorious case and correctly concedes he was wholly unsuccessful in relation to parenting matters – Where the father’s testing of the mother’s parenting position was still warranted – Where the father’s non-disclosure meant the mother was not fully aware of his financial circumstances when negotiating settlement – Where the mother made multiple offers better than the final outcome which the father did not respond to – Father to pay the mother’s costs on a party-party basis from the commencement of proceedings until the delivery of the substantive judgment
Legislation:	Family Law Act 1975 (Cth) – s 117 Federal Circuit and Family Court of Australia (Family Law) Rules 2021
Cases cited:	Colgate Palmolive Co and Another v Cussons Pty Ltd (1993) 118 ALR 248 Hawkins & Roe [2012] FamCAFC 77 Higginbotham & Robinson (1991) FLC 92-209 In the Marriage of W P J Munday and H J Bowman (1997) 22 Fam LR 321 Kohan & Kohan (1993) FLC 92-340 Lenova v Lenova (Costs) [2011] FamCAFC 141 Medlon & Medlon (No 6) (Indemnity Costs) (2015) FLC 93-664 Orioli v Oriolo [1985] FamCA 54 Penfold v Penfold (1980) 144 CLR 311 Quickley & Pelissier [2016] FamCAFC 124 Roydon & Roydon [2023] FedCFamC2F 1265 SVG v KLD [2015] FamCA 687
Division:	Division 1 First Instance
Number of paragraphs:	90
Date of hearing:	6 August 2024
Place:	Heard in Canberra, delivered in Sydney
Counsel for the Applicant:	Ms Tonkin
Solicitor for the Applicant:	Neilan Stramandinoli Family Law
Solicitor for the Respondent:	Mr Lee, Gabbedy Milson Lee

CAC 1369 of 2021
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:	MS VARTANIAN Applicant
AND:	MR MORISHITA Respondent

ORDER MADE BY:	GILL J
DATE OF ORDER:	17 SEPTEMBER 2024