Nickson and Nickson

[2014] FCCA 474

FEDERAL CIRCUIT COURT OF AUSTRALIA

NICKSON & NICKSON [2014] FCCA 474

Catchwords:
FAMILY LAW – COSTS – Whether a costs order should be made – discussion of s.117(2) – earlier order for costs enforced.

Legislation:

Family Law Act 1975, s.117

Penfold & Penfold (1980) FLC 90-800

Applicant: MS NICKSON

Respondent: MR NICKSON

File Number: MLC 2467 of 2012

Judgment of: Judge McGuire

Hearing date: 7 January 2014

Date of Last Submission: 7 January 2014

Delivered at: Melbourne

Delivered on: 3 April 2014

REPRESENTATION

Counsel for the Applicant: Mr T Puckey

Solicitors for the Applicant: Morrison & Sawers

Counsel for the Respondent: Mr Werner

Solicitors for the Respondent: Barbayannis Lawyers

ORDERS

1. That the husband pay the wife’s costs pursuant to paragraph 9 of the orders of 31 May 2013 in a quantum of $2860 such to be paid within 28 days of the date of these orders.

2. That the wife’s applications for costs be otherwise dismissed.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT MELBOURNE

MLC 2467 of 2012

MS NICKSON

Applicant

And

MR NICKSON

Respondent

REASONS FOR JUDGMENT

1. The application before me is one by the wife seeking costs against the husband in respect of three discrete days of the trial of property proceedings.  Those proceedings have concluded and judgment was delivered on 14 November 2013. There is no substantive costs application before me in respect of the judgment. The wife’s application is for the following: 

   i)costs of $4652 thrown away in respect of 11 February 2013;

   ii)costs of $2860 in respect of 31 May 2013;

   iii)costs of $2860 in respect of 6 August 2013. 

2. The total costs sought by the wife are, therefore, $10,372, and, presumably, on a party/party basis. 

3. The application is opposed save and except the husband concedes the costs of 31 May 2013 in the sum of $2860, which are, in any event, already subject to an order of the Court.  I will confirm that order and allocate a time for payment. 

4. Cost issues are provided for in section 117 of the Family Law Act1975 (“The Act”). Subsection (1) provides a general rule that each party to proceeding shall bear his or her own costs, but subject to s.117(2), s.117AA and s.118.

5. There is a discretion in the court pursuant to s.117(2) to make an order for costs if there are justifying circumstances. If the court finds such justification, then s.117(2A) sets out the matters that the court is mandated to reference in determining what, if any, order for costs is appropriate. In Penfold & Penfold[1].  In Penfold & Penfold[2], the High Court, considered the relationship s.117(1) and s.117(2) and observed:

   It is an accurate description of sec 117(1) to say that it expresses a general rule, provided that it is firmly understood that the subsection is not paramount to sec 117(2).  As subsec (1) is expressed to be subject to subsec (2), the former must yield whenever a judge finds in a particular case that there are circumstances justifying the making of an order for costs.

   Susbsection (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order.  Beyond this, there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs.[3]

   [1] (1980) FLC 90-800

   [2] Ibid

   [3] Ibid at 75054

6. Whilst the court has a broad discretion in determining an application for costs, but subject to the making of a finding of justifiable circumstances, it is clear that there is no onus on the applicant seeking an order for cost to convince the court of any preliminary finding of “special or exceptional circumstances”. 

7. The matters to be referenced under s.117(2)(A) are:

   (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.

1 – Costs of 31 May 2013

1. The husband concedes that paragraph 9 of the orders of 31 May 2013 obligate him to pay the wife’s costs set in a quantum of $2860.  Ensuring there is no duplicity, these orders will provide that such be paid within 28 days since the date of these orders.

2 – Costs of 6 August 2013

1. At the conclusion of evidence in the trial on 17 July 2013 the matter was adjourned for further evidence with an estimated hearing time of one day in Shepparton on 6 August 2013.  The trial had commenced in Melbourne, but the matter had originally been conducted, at its interlocutory stages, in the Shepparton circuit.  An application was made then reserving the issue of costs of the final day of the trial. 

2. The wife argues that the trial was lengthened by the additional day of 6 August by reason of the husband making an application to adduce evidence and file an affidavit from a Mr W, and specifically in respect of a major issue between the parties being the cost of reclamation of a [omitted] on the farming property.  No such affidavit had previously been filed although hearsay evidence by way of an alleged quotation from Mr W had been annexed to an affidavit of the husband. 

3. The wife says that the filing of the further Mr W affidavit did not, of itself cause a further sitting day on 6 August 2013.  She argues that the husband has not closed his case and was simply granted leave to file the affidavit out of time.  She says that the affidavit material was relevant to a primary issue.  She asked the Court to note that the husband had been self-represented prior to the commencement of the trial and during the relevant period of preparation of affidavits.  Significantly, the wife argues that the 6 August was not dedicated only to the evidence of Mr W.  Rather, there was evidence of a valuer, Mr P, and final submissions, and that day would need to have been allocated, in any event. 

4. Having considered the nature of the evidence of Mr W, an the conduct of the trial generally, and the fact of the 6 August being occupied with evidence by witnesses other than Mr W and by final addresses, I am not satisfied that there are circumstances justifying a cost order.  Hence, the wife’s application in respect of the costs of 6 August 2013 is dismissed.

3 – 11 February 2013

1. The wife argues that the substantive matter was listed for and due for trial on to commence 11 February 2013. She says that it was unable to proceed due to the husband bringing an application to join his brother, Mr N, as a party.  The husband was again self-represented at this time. An order was made joining Mr N as a party given the prima facie evidence that he held a valuable proprietary interest in the relevant farming property.  Mr N, having been joined as a party, ultimately elected to withdraw. When making his oral application to join Mr N, the husband estimated his brother’s entitlement as substantial. Ultimately, Mr N did not participate either as party or as witness.  His interest in the farming property being a profit a pendre interest in the commercial [omitted] was agreed at $41,000 and the substantive orders acknowledge that interest.  It was the wife who brought the application to join Mr N following the husband’s oral application as to his brother’s interest.  The trial was therefore necessarily adjourned. 

2. The husband, in opposing any order for costs, concedes that Mr N held valuable interests in the farming property.  He argues that the applicant wife’s initiating application sought an order only for the sale of the property (despite the ultimate change in her position by the time of trial).  As such, the husband argues that it was incumbent upon the wife to join Mr N as she sought an order which would impact on his property interest.  The implication is that the ultimate settlement between the primary parties of the interest of Mr N was incidental to and does not negate from her obligation to join Mr N as a party.

3. I accept the argument of the husband in respect of this issue.  The wife did seek an order for the sale of property.  Mr N had an obvious and longstanding interest in that property.  I infer that the wife did or should have been aware of that interest.  I accept, therefore, that there was an obligation to join Mr N as a party.  I agree that the fact of the settlement of Mr N’s interest is incidental and does not serve to remove the original obligation of the wife to join him as a party.  Consequently, I do not find circumstances justifying an order for costs of 11 February 2013.  The wife’s application for costs in respect of this day is dismissed.

I certify that the preceding fifteen (15) paragraphs are a true copy of the reasons for judgment of Judge McGuire

Date: 3 April 2014