Phillips and Phillips (No 2)

[2011] FamCA 53

FAMILY COURT OF AUSTRALIA

PHILLIPS & PHILLIPS (NO. 2) [2011] FamCA 53

FAMILY LAW – COSTS – Security for Costs – Where wife has pursued a litigious path – Where wife’s conduct has been consistently uncooperative – Wife to pay costs of the husband on a scale basis – Costs to be deferred for a period of six months or until wife liquefies any assets held in Sri Lanka – Wife to notify husband’s legal representatives within seven days of any sale of Sri Lankan assets

APPLICANT

(Respondent in the Husband’s application for

security for costs filed 10 December 2010):

Ms Phillips

RESPONDENT

(Applicant in his application for security for

costs filed 10 December 2010):

Mr Phillips

FILE NUMBER: BRC 10818 of 2007

DATE DELIVERED: 4 February 2011

PLACE DELIVERED: Brisbane

PLACE HEARD: Brisbane

JUDGMENT OF: Barry J

HEARING DATE: 4 February 2011

REPRESENTATION

SOLICITOR FOR THE APPLICANT: Mr Hirst, Solicitor of Hirst & Company, Solicitors appearing for the Applicant Husband

SOLICITOR FOR THE RESPONDENT: Mr Hey, Solicitor of Wiltshire Lawyers appearing for the Respondent Wife

Orders

IT IS ORDERED THAT:

1. The Wife pay the costs of the Husband on a scale basis to the Husband’s application for security for costs filed 10 December 2010, to be deferred for a period of six (6) months or until the Wife sells any of the Sri Lankan properties, whichever is the earlier.

2. In the event the Sri Lankan properties are sold the Wife is to notify the Husband’s legal representatives in writing within seven (7) days of such sale.

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

FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: BRC 10818 of 2007

MS PHILLIPS

Applicant
(Respondent in the Husband’s application for security for costs filed 10 December 2010)

and

MR PHILLIPS

Respondent
(Applicant in his application for security for costs filed 10 December 2010)

REASONS FOR JUDGMENT

HUSBAND’S ORAL COSTS APPLICATION RELATING TO HIS APPLICATION FOR SECURITY FOR COSTS FILED 10 DECEMBER 2010

1. I propose to award costs on a scale basis, as sought.  The terms of the financial circumstances of the parties are that the husband has estimated his wealth at a net figure of about $16 million.  For purposes of the quantum of costs in an interim application such as this, I am satisfied the wife is well able to meet an order for costs from the assets that she holds.  She is seemingly worth about $4 million.

2. I do not propose to revisit the history of this litigation.  Suffice it to say I have expressed my astonishment at the way the approach of the wife to the matters necessary to be proved pursuant to section 79A has simply zigzagged.  Firstly, valuations for land - that was abandoned - goodwill of companies - that was abandoned; and various other tacking approaches until we are down to the value of the VW Pty Ltd shares.  That is what it appears to hinge on.  As I have said in my reasons published today, I accept in broad terms the litigation summary put forward by senior counsel for the husband set out at paragraphs 4.1 and following of his written submissions.

3. I accept for present purposes that the relevant subsections of s 117(2) are the conduct of parties and where the party has been wholly unsuccessful.

4. The Husband sought costs on an indemnity basis.  He has achieved an order for security of costs on a scale basis.  So effectively, I would have thought, the wife has been unsuccessful in contesting the matter.  As to conduct, I accept the force of the submissions made by the legal representative for the husband on today’s date.  One could draw an inference from certain conduct of solicitors not responding to letters, omissions from financial statements, failing to allow inspection of a property and various other aspects that there was a distinct lack of cooperation bordering on a cover-up.

5. It is a matter that I will no longer be hearing.  However, I am not in a position to make determinations as to credibility on final issues of fact, but for present purposes, I am of the view that arrangements could have been negotiated to offer some form of security and that was not forthcoming.  There is no evidence before me that any offers have been made.

6. I will accede to the application for costs.  The costs are to be deferred for a period of six months or until the wife sells any of the Sri Lankan properties.  In the event the Sri Lankan properties are sold, the wife is to notify the husband’s solicitors within seven days of such sale.  So the costs will be paid whichever is the earlier, six months or upon the sale of one of the Sri Lankan properties.

I certify that the preceding six (6) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Barry delivered on 4 February 2011

Associate: 

Date:  4 February 2011