On and On (No. 12)

[2007] FamCA 1609

FAMILY COURT OF AUSTRALIA

ON & ON (NO. 12) [2007] FamCA 1609

FAMILY LAW – COSTS – Application for costs made by wife following a long hearing – Orders made for filing written submissions in respect of which the husband has failed to comply – Husband now seeks an order for costs relying, in part, on irrelevant considerations – Issue of “prior offers” – Procedural orders made

Family Law Act 1975 (Cth)

APPLICANT: Mrs ON

RESPONDENT: Mr ON

FILE NUMBER: MLF 7114 of 2001

DATE DELIVERED: 18 December 2007

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Guest J

HEARING DATE: 18 December 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Kirkham QC

SOLICITOR FOR THE APPLICANT: Kennedy Wisewoulds

COUNSEL FOR THE RESPONDENT: In person

SOLICITOR FOR THE RESPONDENT:

Orders

1. That each of the husband and the wife do file and serve on or before 15 January 2008 (“the due date”) a Statement of Current Assets and Liabilities.

2. That the wife do file and serve by the due date supplementary written submissions on costs dealing with the question of “prior offers”. 

3. That the husband do file and serve his written submissions as to costs not later than 23 January 2008 AND THAT in default, the wife’s application for costs proceed on an undefended basis.

4. That in the event that the husband does file and serve his written submissions as to costs, the wife do file and serve any written submissions in reply within 14 days thereafter.

5. That the husband do forthwith provide to the wife’s solicitors details of any offer (when made) in respect of the sale of the property known as “[the A property]”, SR 1A-1B.

6. That the wife’s Form 2 Applications filed 15 November 2007 and 6 December 2007 and the husband’s Form 2 Application filed 13 December 2007 be otherwise dismissed.

7. That the costs of both parties of this day be reserved.

IT IS CERTIFIED

(8) That pursuant to rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of Counsel.

IT IS DIRECTED

1. That:

   9.1a transcript of the submissions made this day be placed on the court file, and

   9.2the ex tempore judgment delivered this day be transcribed, placed on the court file and made available to the parties.

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

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 7114  of 2001

MRS ON  

Applicant

And

MR ON  

Respondent

REASONS FOR JUDGMENT

1. This matter comes before me for mention only and typical of its history has mushroomed into lengthy and contested argument.  Mr Kirkham, one of her Majesty's counsel, continues to appear for the applicant wife and the husband continues to appear in person. 

2. Mr Kirkham outlined the background to the issues and the various matters for my consideration.  I do not propose to precisely detail those submissions nor those of the husband, for the same will appear in the transcript of the proceedings this day.  Given the pressure of time placed upon me and currently part-heard in a trial which was to commence 40 minutes ago, my remarks will be necessarily truncated.  I rely upon the fact of the transcript itself, which I will direct be made and placed upon the court file, detailing those matters submitted to me by both Mr Kirkham and the husband. 

3. Following my substantive judgment delivered in July 2007, the wife caused to be filed a Form 2 Application on 3 August 2007 seeking costs of the final hearing on an indemnity basis.  On 14 August 2007, the matter came before me and I ordered the wife do file and serve written submissions on or before 28 August 2007.  This order was complied with by the wife.  I further ordered that the husband do file and serve written submission on or before 11 September 2007.  That order has not been obeyed.  There has been no compliance to this day by the husband in relation to my order which is now aged in time by over four months.

4. On 13 September 2007, the husband caused to be filed a Form 2 Application in which he sought costs against the wife.  He filed a short affidavit and, amongst other matters, some of which were quite irrelevant, made reference to previous offers.  The matter came before me again for mention on 21 September 2007.  I ordered that the husband file and serve by 21 October 2007 his submissions on costs and further ordered that the wife file and serve any further submissions within 21 days thereafter.  Again the husband has failed to file and serve those written submissions.  I am informed by Mr Kirkham that the wife agreed to an extension, as a convenience to the husband, to 2 November 2007.  Notwithstanding this indulgence, no submissions have been filed.  I regard the husband’s conduct and attitude as arguably quite insubordinate displaying scant regard for the authority of those orders.

5. Properly, given the whole history of the circumstances, it is not unexpected therefore that on 15 November 2007, the wife caused to be filed a Form 2 Application seeking that the husband's Application filed on 13 September 2007 be dismissed.  The fundamental reason for that was his abject non-compliance.  The wife further sought that her Application of 3 August 2007 be decided on an undefended basis.  That Application was supported by an affidavit filed by the wife. 

6. It was the submission of Mr Kirkham that the husband's Application of 13 September 2007 and supported by his affidavit was misconceived, and substantially so, in reference to a number of issues.  He submitted that the financial situation of the husband was never made clear until the time of trial and went on to argue, as has been the basis of a number of submissions in the past, that the husband was given to a course of obfuscation and non disclosure.  He submitted that it “was impossible” to know in those circumstances how any prior offer should be considered as the situation could not be approached "in a vacuum".  He pointed out that each offer otherwise superseded the previous offers, rendering that previous offer nugatory.  

7. Mr Kirkham submitted that “the only offer” of any relevance was the final offer made, namely, that contained in his Application.  He submitted that the husband had every opportunity to consider his position and that the wife's proposal at the time of trial was reasonable.  He made it clear that, so far as the wife was concerned, she was not in a position to know the reality of the husband's position until the actual trial.  It was his further submission that the husband was endeavouring, in his argument, to go behind the terms of my judgment and in this regard, part of his Application was misconceived.

8. Historically then, the wife caused to be filed a further Form 2 Application on 6 December 2007 together with a supporting affidavit.  Mr Kirkham informed me that it was understood the husband was leaving for overseas "permanently" in February 2008.  Further, that his properties were for sale, which included necessarily the SR and E properties.  The wife was seeking information in relation to those sales. 

9. As to that particular aspect, the husband averred that he was not going overseas permanently, and had no present intention to travel overseas.  He did say, it appeared to me, somewhat as an aside that he may travel overseas sometime later in 2008. 

10. Mr Kirkham otherwise referred to the fact of cost orders made on both 7 February 2007 for taxed costs and an order for costs made on 16 February 2007 in the sum of $4200.  The taxed costs and the other ordered costs, as I understand it, amount to some $81,000.  As at November 2007, as I understand Mr Kirkham's submission, the wife was owed overall the sum $85,154.10 pursuant to costs orders.  He submitted that the wife was seeking to place caveats over both of the SR properties, submitting that from his instructions, a sale “was imminent”.  He submitted that contracts “may have been signed”, but did not know the status of the sale.  In those circumstances, referring to paragraphs 14 and 16 of the wife's affidavit, for the reasons stated, he sought orders that caveats be placed on those properties.

11. Mr Kirkham then referred to the husband's Form 2 Application filed on 13 December 2007 together with the supporting affidavit, submitting that he raised matters that were substantially irrelevant. 

12. I then heard from the husband.  I have already detailed in this short extempore judgment his submissions as to his intent or otherwise concerning overseas travel.  As a result of inquiries made by me in clarification of the current position, the husband said that the E property had been sold for $1.140 million, with settlement to take place in February 2008.  That property is encumbered by a mortgage in favour of the Macquarie Bank in the sum of $1 million.

13. The husband informed me that the SR “tennis court” property (the SR1A property) was recently sold for $2.9 million, with settlement to take place on 21 December 2007.  He said that “the house block” namely, "The [A property]" (the SR1B property) has been offered for sale.  The agent dealing with the sale is Kay and Burton and can be identified on the Internet.  No offers have been made. 

14. The husband said that the old business, namely, Shop …, has been sold for $2.75 million, and after payment of costs, "nothing is left".  He said that he would continue to operate the new business.  He opposed caveats being placed over the tennis court block and for good reason.  Following discussion with Mr Kirkham, it was seen as inappropriate that a caveat be placed, and accordingly no order will be made in that regard.  The husband informed me that the settlement proceeds, after deduction of necessary costs, real estate agent's fees and commissions, will be applied to the reduction of the mortgage in favour of BE Pty Ltd who hold a first mortgage over the total land holding at SR in the sum of $5.3 million. 

15. Returning to The SR1B block , the husband submitted that details appear on the Internet and he was awaiting "expressions of offer".  If no offers were made, then it was his intention to put it to auction.  He informed me that the Australian Taxation Office, for reasons stated by him in the course of his submissions, had made claims upon him. 

16. In the course of his submissions, the husband made it patently clear that "there will be another trial".  Appropriately, I indicated to him that the Rules provided 30 days for the filing of any Notice of Appeal, but after that, any Application would have to be made for leave to appeal out of time.  I made it also clear to him that there are substantial matters to be addressed in support of such an application.

17. As to the order of 21 September 2007, the husband blandly conceded, "I failed to comply”, and went on to say, "I apologise”, adding, "I don't believe I should pay costs”.  It seems to me that this is now the end of the road in relation to a number of these matters, save for the spectre looming on the horizon of another trial, as indicated firmly by the husband in the course of his submissions, evoking conceptually the sword of Damocles.

18. This has been a tortuous process for the parties, for the court and for all legal practitioners.  There have been two trials.  There has been a successful appeal in relation to the first trial.  The second trial spanned some two weeks.  It was a highly complex matter.  A judgment of considerable length was delivered with fair speed and speaks for itself.  The issue that I am to deal with, in substance, is that of costs.  The husband has undisguisedly failed to abide the orders I made as far back as 14 August 2007. 

19. In normal circumstances I would see this as the end of the road, frankly, and brook no further convenience.  However, in the whole of the circumstances of this matter, I will give him one final opportunity which arises from an order that I should necessarily make concerning submissions by the wife in relation to “prior offers”.  That opens the door in my view to provide to the husband one last chance for the filing of submissions in relation to costs.  However, and I make it clear, this is the last port of call.  If the husband fails to abide the order for the filing of written submissions on costs, then given the whole of the circumstances which I have relayed in this short extempore judgment, and having regard to the submissions put to me by both Mr Kirkham and the husband, the wife's application for costs will proceed on an undefended basis. 

20. In the course of his submission, Mr Kirkham said that the wife was proceeding with her submissions in relation to the husband's Application filed 13 September 2007 and also in relation to that of caveats being placed over the named properties.  It seems to me that I can deal with the caveat issue by requiring the husband to forthwith provide to the wife's solicitors details of any offer, when made, in respect of The A property (SR1B).  By "forthwith" I mean immediately.  Accordingly, the position can then be assessed by the wife as to whether or not an application should be made to protect her interests, certainly for the sum of $85,000 or thereabouts in respect to costs owed and unpaid to this date, and to secure the position of a potential order for costs arising from the trial itself.

21. It appears to me also appropriate, given the current financial circumstances of the husband as outlined by him to me in the course of his submissions and the issue raised by the wife, that each of the parties should file a current statement of assets and liabilities. That of course is a necessary matter for my consideration pursuant to section 117(2A) of the Family Law Act 1975 (as amended).

I certify that the preceding twenty one (21) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Guest.

Associate 

Date:  21 January 2008