Petergrass and Vanburn and Anor (Security For Costs)
[2010] FamCA 541
•30 June 2010
FAMILY COURT OF AUSTRALIA
| PETERGRASS & VANBURN AND ANOR (SECURITY FOR COSTS) | [2010] FamCA 541 |
| FAMILY LAW – COSTS – security for costs – parties of limited financial means – no order for costs made |
| Family Law Act 1975 (Cth) |
| B and B (1986) FLC ¶91-749 Luadaka v Luadaka (1998) FLC ¶92-830 Fennessy & Gregorian (Security for Costs) [2008] FamCAFC 89 |
| APPLICANT: | Mr E Pentergrass |
| 1st RESPONDENT: | Ms Vanburn |
| 2nd RESPONDENT: | Mr T Pentergrass |
| FILE NUMBER: | CAC | 711 | of | 2007 |
| DATE DELIVERED: | 30 June 2010 |
| PLACE DELIVERED: | Sydney |
| PLACE HEARD: | Canberra |
| JUDGMENT OF: | Justice Fowler |
| HEARING DATE: | 24 June 2010 |
REPRESENTATION
| APPLICANT: | In person |
| COUNSEL FOR THE RESPONDENT: | Mr Brzostowski |
| SOLICITOR FOR THE 2ND RESPONDENT: | Mr Nicholl |
Orders
The husband’s Application in a Case filed 12 May 2010 as orally amended on 24 June 2010, for orders for security for costs is dismissed.
IT IS NOTED that publication of this judgment under the pseudonym Pentergrass & Vanburn and Anor (Security for Costs) is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| FAMILY COURT OF AUSTRALIA AT SYDNEY |
FILE NUMBER: CAC 711 of 2007
| MR E PENTERGRASS |
Applicant
And
| MS VANBURN |
1st Respondent
And
| MR T PENTERGRASS |
2nd Respondent
REASONS FOR JUDGMENT
Introduction
The substantive proceedings before the Court are proceedings commenced by an application filed in a Response that orders made by the Family Court of Australia by the consent of the parties be set aside under section 79A of the Family Law Act 1975 (“the Act”), and that other orders be made.
That application is brought by the wife and opposed by the husband.
On the day of hearing the present application the husband put before the Court an Application in a Case in which the husband sought initially spousal maintenance in the sum of $20,000 and payment of security for costs in the sum of $40,000.
In subsequent discussion with the Court it was pointed out to the applicant that he had not procured leave to bring the spousal maintenance application as would be required having regard to the date upon which the decree for the dissolution of the parties’ marriage became absolute.
In the event the husband abandoned his claim for interim spousal maintenance and sought and procured leave to amend his claim to a claim for $60,000 as security for costs, in lieu of the $40,000 previously sought.
Whilst the applicant husband initially sought an order that the amount be paid to him by way of security for costs, he subsequently sought before the Court that the amount be paid into the Court to be held pending the determination of the substantive proceedings.
The husband’s evidence was encapsulated in an affidavit lodged in support of his application and in various documents tendered to the Court upon the hearing of the matter.
The affidavit filed by the husband contained some inadmissible material although no objection was taken to that and some material which was tendered was of insufficient particularity to enable any significant weight to be placed upon it.
Ultimately at the hearing the husband sought to argue much of his case from statements previously made by the wife and those set forth in her affidavit filed with leave on the morning of the hearing.
The matters that the husband put before the Court were that he was without means and unable to procure legal representation. He further alleged that he had a serious medical condition involving brain tumours which gives rise to blackouts. He asserted that this impaired his functioning ability both in presenting his case and generally, although no expert evidence was before the Court.
Whilst there is a dispute between the husband and the wife as to the extent of the husband’s impairment by reason of his health, there is no doubt that the wife has agreed in the past that he does suffer from ill health.
It was asserted by the husband, and I accept, that he is of limited financial means.
I believe that the hearing of this matter would be rendered more difficult both for him, and for the Court, were he not to have legal representation.
In debate before the Court the husband was articulate, if somewhat garrulous, and he appeared to understand the proceedings and had drafted affidavits which at least put some admissible material before the Court.
I accept on his evidence that he is unable to afford legal representation.
It is a case where, in the absence of assistance from legal aid or other form of funding, the husband will potentially suffer under the disability of having to present his own case without proper legal advice or representation.
The pro se litigation phenomenon is increasing in Australia in the absence of legal aid to assist litigants before this Court to put their cases before it. This is regrettable, particularly in a case such as this where, if the wife is successful there will be some funds available to the husband, but if the wife is not successful on the present indications as to the wife’s means, then no such funds will be available or at least not for a very long period of time.
It should be noted that the application before the Court, given the nature of the case, is for security for costs, and not a potential property settlement. Whilst references were made dealing with partial property settlement what is sought is something different.
Having established that the husband has a need for representation, which he cannot meet from his own resources, I am obliged then to look at the assets and resources of the wife.
The wife is legally represented in these proceedings and I accept the evidence that she is so legally represented as a result of loans made to her by others or by monies otherwise provided by friends or relatives.
The wife clearly has no assets of her own to an extent which would enable her to meet the amount claimed, or any reasonable portion of it.
The question is, therefore, is the charity of friends or the incurring of debts or the ability to incur debts a financial resource from which a fund should be established to permit of representation of the husband?
The husband asserts that if she is successful in the substantive proceedings then the sum paid into the Court can be refunded and if the wife is unsuccessful in the substantive proceedings the sum paid into Court will be an available fund to meet his costs.
However, whilst that may be true what it will do will leave the wife with an even greater debt to those who have provided her with charitable assistance. I do not accept that she should be required to borrow to provide a fund to be available for the purposes of the husband’s application.
There is no fund of the wife’s from which the security for costs can be met.
Section 117 considerations
Section 117 of the Act provides each party to the proceedings under the Act shall bear his or her own costs.
However, the court has a broad discretion to make such orders as to costs and security for costs by way of interlocutory order or as the court considers just.
In considering the order which should be made (if any), the court is obliged to take into account:
(a) the financial circumstances of each of the parties to the proceedings
I have referred to this matter and accept that neither of these parties has any substantial means or financial resources.
(b) whether any party to the proceedings is in receipt of legal aid and, if so, the terms of the grant of that assistance to that party
There is no evidence that either party is in receipt of legal aid assistance.
(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
There is no assertion that either of the parties has failed in their application in the Court to properly conduct themselves in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents or 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
The proceedings have not been 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
Since this is an application in which interim relief is sought, the Court is not yet able to determine whether either party will be wholly unsuccessful in the proceedings and equally at this time it is irrelevant to determine that matter.
(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
There is no evidence before the Court of the particulars of any efforts to settle the proceedings.
(g) such other matters as the Court considers relevant
Counsel for the wife referred the Court to two decisions: Luadaka v Luadaka (1998) FLC ¶92-830 and Fennessy & Gregorian (Security for Costs) [2008] FamCAFC 89.
Luadaka v Luadaka (supra), a decision of the Full Court of the Family Court of Australia, sets out the relevant principles applicable to an application for security for costs. In addition to the matters referred to in section 117(2A), as above, the Full Court considered that it may be relevant for the court to consider the means of the applicant to satisfy an order for costs if he or she is unsuccessful.
I have said that neither party is presently in a position to meet such an order.
In relation to the prospects of success of the application, one could not say on the evidence thus far adduced that there was no possibility of success, and it is not possible on this application to determine matters of credit. If the wife’s evidence is accepted she has an arguable case.
I accept that the application is brought bona fide.
An order for the provision of security for costs if made may well be oppressive or stifle the litigation.
This is not a piece of litigation which involves any matter of public importance and the application for security for costs has been brought within reasonable time.
I am obliged to consider the quantum of the costs that might be incurred and in that regard the husband points to monies expended by the wife in relation to her application thus far in the sum of $40,000 and seeks an amount of $60,000 which may be less than would be incurred by each party.
In Luadaka v Luadaka (supra) the Full Court at 85,5023 - 85,503 quoted from the decision of Gee J in B and B (1986) FLC ¶91-749 at 75,480:
… that the question for the Court upon an application for the provision for a wife’s costs is whether she has sufficient separate estate wherewith to pay her costs. It is also clear from the said cases that as part of its determination of that question the Court may consider the extent of the means of both parties, including capital and income and the availability thereof.
Their Honours go on to say (at 85,507) that:
Ordinarily the means of the applicant is not alone sufficient to justify an order for costs because of the rule that poverty should be no bar to justice.
It is clear that the applicant does not have the means with which to meet an order for security for costs and her failure to meet such an order, if made, would shut her out of an entitlement to relief.
This is not a case where the applicant should be denied justice by reason of her financial situation and, in all the circumstances and in the exercise of my broad discretion, I propose to dismiss the application of the husband in relation to the proceedings before me, and having considered the financial circumstances of each of the parties I make no order as to costs of his application.
I certify that the preceding forty six (46) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Fowler.
Associate:
Date: 30 June 2010
0
2
1