Neetmanski and Child Support Registrar an d Neetmanska (No.2)

[2009] FMCAfam 430

FEDERAL MAGISTRATES COURT OF AUSTRALIA

NEETMANSKI & CHILD SUPPORT REGISTRAR and NEETMANSKA (No.2) [2009] FMCAfam 430

CHILD SUPPORT – Costs – applicant unsuccessful in challenging administrative recovery of child support arrears – costs sought by Child Support Registrar.

Federal magistrates Act 1999, s.79
Family Law Act 1975, s.117

Yates Property Corp Pty Ltd v Boland (No.2), [1997] FCA 760, (1997) 147 ALR 685
Hughes v Western Australian Cricket Association (Inc) [1986] FCA 2491, (1986) ATPR 40-748

Applicant: MR NEETMANSKI

First Respondent: CHILD SUPPORT REGISTRAR

Second Respondent: MS NEETMANSKA

File Number: PAM 4408 of 2005

Judgment of: Halligan FM

Hearing date: 26 March 2009

Date of Last Submission: 2 April 2009

Delivered at: Parramatta

Delivered on: 25 May 2009

REPRESENTATION

Solicitors for the Applicant: No Appearance

Solicitors for the First Respondent: Australian Government Solicitor

Solicitors for the Second Respondent: No Appearance

ORDERS

1. The applicant shall pay to the first respondent or the first respondent’s solicitor within one month after service of a sealed copy of this order on him by ordinary prepaid post to his address for service, $18,531.66 costs of these proceedings.

IT IS NOTED that publication of this judgment under the pseudonym Neetmanski & Child Support Registrar and Neetmanska is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA AT
PARRAMATTA

PAM 4408 of 2005

MR NEETMANSKI

Applicant

And

CHILD SUPPORT REGISTRAR

First Respondent

MS NEETMANSKA

Second Respondent

REASONS FOR JUDGMENT

Introduction

1. On 26 March 2009, when I delivered reserved judgment in this case, I dismissed proceedings brought by the applicant father seeking to challenge on various grounds the recovery by the first respondent, the Child Support Registrar (the Registrar), of child support arrears owing by the applicant using administrative attachment powers to seize moneys otherwise due to the applicant.

2. The Registrar sought costs against the applicant on 26 March 2009.  The applicant did not attend when judgment was delivered.  I therefore directed that the Registrar lodge and serve written submissions in support of the costs order sought within seven days, that the applicant lodge and serve any written submissions in reply within one month thereafter, and that if the applicant wished to make any oral submissions on the issue of costs, he give the court and the first respondent written notice within one month.

3. The second respondent, the mother, has not taken an active part in the proceedings.

4. The Registrar lodged written submissions on 2 April 2009. I am satisfied by affidavit evidence filed on behalf of the Registrar that the Registrar posted, faxed and emailed copies of its submission to the applicant on 2 April 2009. No written submissions were received from the applicant. No request was received from the applicant seeking to make any oral submission. Nonetheless, I listed the matter today and had the applicant notified that today was the day for final determination of the Registrar’s costs application. The applicant failed to appear today. The Registrar relied on the written submissions previously submitted.

Applicable law

1. The applicant commenced the proceedings in the Federal Court.  The proceedings were then transferred by the Federal Court to this court.  The expression of the orders sought by the applicant in his application leaves the precise nature of the causes of action on which he sought those orders unclear.  The relief may have been sought under the child support legislation, or it may have been sought by way of some form of administrative review of the Registrar’s decisions, or a combination of the two.  He also included a claim for damages, the basis of which is less than clear.

2. The significance of this is that it is therefore unclear whether costs are to be determined as if this matter fell within the court’s family law and child support jurisdiction, or within its general federal law jurisdiction, or both.

3. If the proceedings are brought in the court’s family law and child support jurisdiction, costs are governed by s.117, Family Law Act 1975 (see s.79(1), Federal Magistrates Act 1999). Under s.117, prima facie each party bears his or her own costs (s.117(1)). However, a court may order a party to pay another party’s costs if satisfied there are circumstances that warrant it doing so (s.117(2)). In determining whether to make a costs order, the court must have regard to those of the following matters as are relevant, namely:

   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, admission 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 order; and

   g)Such other matters as the court considers relevant (s.112(2A)).

4. If the proceedings are in the court’s general federal law jurisdiction, costs are governed by s.79, Federal Magistrates Act, which provides that the court has jurisdiction to award costs in proceedings other than family law or child support proceedings and other than where an Act provides that costs must not be awarded. Unless otherwise provided in the rules or an Act, the award of costs is in the discretion of the court.

5. While the discretion to award costs under s.79 is unfettered, it must be exercised judicially and in the context of the court rules (Yates Property Corp Pty Ltd v Boland (No.2), [1997] FCA 760, (1997) 147 ALR 685). While the discretion is unfettered, there are nonetheless decisions that provide guidance at to the exercise of the discretion. Toohey J in Hughes v Western Australian Cricket Association (Inc) [1986] FCA 2491, (1986) ATPR 40-748 summarised the effect of the guidance derived from authoritative decisions of both Australian and English courts as follows:

   a)Ordinarily, costs follow the event and a successful litigant receives his costs in the absence of special circumstances justifying some other order;

   b)Where a litigant succeeded only on a portion of his claim, the circumstances may make it reasonable that he bear the expense of litigating that portion upon which he has failed;

   c)A successful party who had failed on certain issues may not only be deprived of the costs of those issues but may be ordered as well to pay the other party’s costs of them.  In this sense, “issue” does not mean a precise issue in the technical pleading sense but any disputed question of fact or law.

6. Matters that may be relevant to the exercise of discretion in determining whether costs should follow the event include the conduct of the parties before or during the litigation, offers of settlement, and whether the proceedings raised an issue of public interest.

7. In the circumstances, as dealing with the costs issue under s.117 of the Family Law Act will enable me to appropriately determine the costs application under a legal regime that is most advantageous to the applicant, I propose to do so without deciding definitively which provision applies to each part of the applicant’s application.

The Registrar’s case for costs

1. The Registrar seeks an order that the applicant pay its costs in the sum of $18,531.66. While the Registrar’s primary submission was that the costs are governed by s.79, Federal Magistrates Act, alternative submissions were made if the court found that the costs were governed by s.117 of the Family Law Act.

2. The alternative submissions on behalf of the Registrar under s.117 are that there is no evidence the applicant cannot afford to pay the costs, the applicant is not in receipt of legal aid, the applicant has been wholly unsuccessful, a relevant offer of settlement was made by the Registrar and not accepted by the applicant, and the applicant’s claims were totally lacking in merit. It was further sought to rely on matters of conduct by the applicant in the proceedings, including failure by the applicant to comply with orders to file documents, failure to attend court, and seeking to delay the proceedings on various bases, none of which were successful. The settlement offer, which was without prejudice save as to costs, was made by letter dated 30 April 2008, and offered to settle the Federal Magistrates Court proceedings on the basis the applicant withdrew his claims and agreed to pay the Registrar costs of $11,500, and agreed to pay the Registrar costs of $1,500 in High Court proceedings in which an application for special leave to appeal by the applicant had been dismissed with costs.

Decision

1. The only evidence in relation to the applicant’s financial circumstances is his description of himself in his affidavit as “retired (due to physical disability – severe lumbar spine injury)”. The inference from the evidence is that the applicant receives money under one or more insurance policies as a result of these injuries or disabilities. There is otherwise no evidence as to the applicant’s financial circumstances, including the amounts to which he is entitled under the insurance policies. The Registrar is, of course, a government agency funded by Australian taxpayers.

2. The applicant was entirely unsuccessful in the proceedings.  Part of his application was summarily dismissed. On the remaining issues, the applicant sought to advance a wide range of arguments in support of the relief he sought, but none had any merit. Some sought to challenge issues authoritatively determined already by the High Court, a fact brought to the applicant’s attention, but he nonetheless maintained his position without suggesting any basis for his position that could in any way call into question the High Court decision, which this court could not disregard in any event. In relation to other arguments, the applicant selectively relied on certain statutory provisions while ignoring others in the same legislation that rendered his argument untenable. He conceded in court that he knew his application would fail, but nonetheless pressed it fully to the bitter end, causing the Registrar to incur considerable legal costs in defending claims that the applicant knew would fail.

3. In those circumstances, I am satisfied a costs order is warranted under s.117 of the Family Law Act, and I will grant the Registrar’s application.

4. If the award of any or all of the costs sought by the Registrar is governed by s.79 of the Federal Magistrates Act, based on what I have said earlier in relation to the principles that govern an award of costs under s.79, and having regard to the above matters, I am also satisfied that costs are justified under s.79.

I certify that the preceding seventeen (17) paragraphs are a true copy of the reasons for judgment of Halligan FM

Associate:  Deanne Bush

Date:  25 May 2009