PATINOS & PATINOS

Case [2019] FCCA 1479

FEDERAL CIRCUIT COURT OF AUSTRALIA

PATINOS & PATINOS [2019] FCCA 1479
Catchwords:
FAMILY LAW – Application for costs following the resolution of property proceedings by consent – basis of Application was that an offer had been made by the Husband after the conciliation conference – Wife legally aided – Wife has sole care of the youngest child of the long relationship – considerations regarding justice and equity – Application dismissed – no Orders as to costs other than each party is to pay his and her own costs.

Legislation:

Family Law Act 1975, ss.117(1), 117(2A)(a) & (b)

Federal Circuit Court Rules 2001

Cases cited:

Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225
Stephens v Stephens (2011) 44 Fam LR 117
Applicant: MR PATINOS
Respondent: MS PATINOS
File Number: CAC 96 of 2017
Judgment of: Judge Neville
Hearing date: Written Submissions
Date of Last Submission: 26 March 2019
Delivered at: Canberra
Delivered on: 31 May 2019

REPRESENTATION

Solicitors for the Applicant: Farrar Gesini Dunn
Solicitors for the Respondent: Legal Aid NSW

ORDERS

  1. The Respondent Husband’s Application in a Case, filed on 21st December 2018, and the Applicant Wife’s Response to the Husband’s Application in a Case filed on 1st March 2019, be dismissed.

  2. The parties are to bear their own costs of, and incidental to, these proceedings.

  3. All extant Applications be dismissed, the matter is now finalised and will be removed immediately from the docket.

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

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT CANBERRA

CAC 96 of 2017

MR PATINOS

Applicant

And

MS PATINOS

Respondent

REASONS FOR JUDGMENT

Introduction

  1. This property matter was resolved on 30th November 2018 pursuant to terms of settlement being entered into by the parties and Orders being made in consequence of them.

  2. In general terms, the property pool was quite modest.  The relationship between the parties, which began when the Applicant Wife was aged 16 years and the Respondent Husband was aged 21 years, was approximately 21 years duration.  There were 3 children of the relationship.

  3. For part of the parties’ relationship, the Wife was the Husband’s carer.  The parties are now aged, 42 and 46 years respectively.  The Wife is an Aboriginal woman from the … people.

  4. The Wife’s sole income is from Centrelink benefits, as is the Husband’s.  He receives a Newstart allowance.  The Wife has the sole care of the parties’ third child (aged almost 14 years).  That child spends no time with the Husband.  The elder two children are both over 18 years.

  5. Due to various medical conditions, which I need not detail here, the Husband has little or no capacity to work.  He has a very young child (aged approximately just over 1 year) with his new partner.

  6. The principal asset of the relationship was a house (“the Property A property”) which was purchased for $260,000.

  7. In the Wife’s Initiating Application,…

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AGLC
Patinos and Patinos [2019] FCCA 1479
Case
[2019] FCCA 1479
Decision Date

CaseChat Overview and Summary

In *Patino & Patino*, the Applicant Wife sought costs against the Respondent Husband following the consent resolution of property proceedings. The Wife was legally aided and had the sole care of the youngest child of the relationship. The basis of her application was an offer made by the Husband after a conciliation conference.

The Court was required to determine whether to depart from the usual rule that parties bear their own costs in family law proceedings, particularly in light of the Wife's legal aid status and the Husband's offer to compromise. The Court considered the principles governing the award of costs, including the general rule that costs are awarded on a party and party basis, and the exceptional circumstances required to justify an order for indemnity costs.

Judge Neville referred to the principles outlined in *Colgate-Palmolive Co v Cussons Pty Ltd*, which establish that costs orders are generally made on a party and party basis unless the circumstances warrant a departure. While an imprudent refusal of an offer to compromise can be a factor justifying a departure, the Court found that the specific circumstances of this case did not warrant such a departure. The Court noted that the Wife was legally aided and that the Husband's offer, while made, did not meet the threshold for an indemnity costs order given the overall context of the proceedings and the need for justice and equity.

Consequently, the Court dismissed the Husband's application and the Wife's response thereto. The final orders stipulated that each party was to bear their own costs of, and incidental to, the proceedings, and all extant applications were dismissed, finalising the matter.

Orders

Orders of the court

1.

The Respondent Husband’s Application in a Case, filed on 21st December 2018, and the Applicant Wife’s Response to the Husband’s Application in a Case filed on 1st March 2019, be dismissed.

2.

The parties are to bear their own costs of, and incidental to, these proceedings.

3.

All extant Applications be dismissed, the matter is now finalised and will be removed immediately from the docket.

Background

Background to the litigation

The decision of Sheppard J in Colgate-Palmolive Co v Cussons Pty Ltd (noted by the Full Court) is a regularly cited authority for relevant principle regarding the awarding of indemnity costs.[2] In that judgment, his Honour outlined the following principles, at pp.232 – 234, which I set out in full (emphasis added):[2] Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225It seems to me that the following principles or guidelines can be distilled out of the authorities to which I have referred:- 1. The problem arises in adversary litigation, i.e. litigation as between parties at arm's length. Different considerations apply where parties may be found to be entitled to the payment of their costs out of a fund or assets being administered by or under the control of a trustee, liquidator, receiver or person in a like position, eg. a government agency or statutory authority. 2. The ordinary rule is that, where the Court orders the costs of one party to litigation to be paid by another party, the order is for payment of those costs on the party and party basis. In this Court the provisions of Order 62, rules 12 and 19, and the Second Schedule to the Rules will apply to the taxation. In many cases the result will be that the amount recovered by the successful party under the Order will fall short of (in many cases well short of) a complete indemnity. 3. This has been the settled practice for centuries in England. It is a practice which is entrenched in Australia. Either legislation (perhaps in the form of an amendment to rules of Court) or a decision of an intermediate court of appeal or of the High Court would be required to alter it. No doubt any consideration of whether there should be any change in the practice would require the resolution of the competing considerations mentioned by Devlin LJ in Berry v. British Transport Commission and Handley JA in Cachia v. Hanes on the one hand and by Rogers J in Qantas on the other. The relevant passages from the respective judgments have been earlier referred to. 4. In consequence of the settled practice which exists, the Court ought not usually make an order for the payment of costs on some basis other than the party and party basis. The circumstances of the case must be such as to warrant the Court in departing from the usual course. That has been the view of all judges dealing with applications for payment of costs on the indemnity or some other basis whether here or in England. The tests have been variously put. The Court of Appeal in Andrews v. Barnes (39 Ch D at 141) said the Court had a general and discretionary power to award costs as between solicitor and client "as and when the justice of the case might so require." Woodward J in Fountain Selected Meats appears to have adopted what was said by Brandon LJ (as he was) in Preston v. Preston ((1982) 1 All ER at 58) namely, there should be some special or unusual feature in the case to justify the Court in departing from the ordinary practice. Most judges dealing with the problem have resolved the particular case before them by dealing with the circumstances of that case and finding in it the presence or absence of factors which would be capable, if they existed, of warranting a departure from the usual rule. But as French J said (at 8) in Tetijo, "The categories in which the discretion may be exercised are not closed". Davies J expressed (at 6) similar views in Ragata. 5. Notwithstanding the fact that that is so, it is useful to note some of the circumstances which have been thought to warrant the exercise of the discretion. I instance the making of allegations of fraud knowing them to be false and the making of irrelevant allegations of fraud (both referred to by Woodward J in Fountain and also by Gummow J in Thors v. Weekes (1989) 92 ALR 131 at 152; evidence of particular misconduct that causes loss of time to the Court and to other parties (French J in Tetijo); the fact that the proceedings were commenced or continued for some ulterior motive (Davies J in Ragata) or in wilful disregard of known facts or clearly established law (Woodward J in Fountain and French J in J-Corp); the making of allegations which ought never to have been made or the undue prolongation of a case by groundless contentions (Davies J in Ragata); an imprudent refusal of an offer to compromise (eg Messiter v. Hutchinson (1987) 10 NSWLR 525, Maitland Hospital v. Fisher (No. 2) (1992) 27 NSWLR 721at 724 (Court of Appeal), Crisp v. Keng (Supreme Court of New South Wales, 27 September 1993, unreported, Court of Appeal)and an award of costs on an indemnity basis against a contemnor (eg Megarry V-C in EMI Records). Other categories of cases are to be found in the reports. Yet others to arise in the future will have different features about them which may justify an order for costs on the indemnity basis. The question must always be whether the particular facts and circumstances of the case in question warrant the making of an order for payment of costs other than on a party and party basis. 6. It remains to say that the existence of particular facts and circumstances capable of warranting the making of an order for payment of costs, for instance, on the indemnity basis, does not mean that judges are necessarily obliged to exercise their discretion to make such an order. The costs are always in the discretion of the trial judge. Provided that discretion is exercised having regard to the applicable principles and the particular circumstances of the instant case its exercise will not be found to have miscarried unless it appears that the order which has been made involves a manifest error or injustice.

Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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