Preston and Maine (No. 2)

In *Preston & Maine (No. 2)*, the Family Court of Australia considered an application for costs following the dismissal of the applicant's, Mr Preston's, application for leave to proceed out of time to seek orders for the alteration of property interests against the respondent, Ms Maine. The applicant had asserted he was out of time to bring his application, and the court found his claim lacked merit and had no prospect of success. The respondent sought costs against the applicant, including on an indemnity basis, for the entirety of the proceedings.

The court was required to determine whether to make an order for costs against the applicant, and if so, whether those costs should be on a party-party or an indemnity basis. The court also had to consider the relevant factors under section 117(2A) of the *Family Law Act 1975* (Cth), including the financial circumstances of the parties, the conduct of the parties, and whether the applicant had been wholly unsuccessful.

Justice Cronin noted that while section 117(1) of the Act establishes a general rule that parties bear their own costs, section 117(2) grants the court discretion to make costs orders where circumstances justify it. The court identified several justifying factors for departing from the usual rule, including the applicant's failure to properly define his application, his persistence with a claim despite the respondent's clear lack of legal interest in the property, and his failure to address the respondent's life interest in the property. Regarding the request for indemnity costs, the court referred to *Prantage and Prantage* and *Kohan and Kohan*, emphasising that indemnity costs are a significant departure from the norm and require exceptional circumstances. The court found no exceptional circumstances in this case to warrant indemnity costs.

Balancing the factors under section 117(2A), including the parties' financial circumstances, the applicant's conduct in pursuing a flawed claim without addressing fundamental issues, and the applicant's complete lack of success, the court found it just to make an order for costs. The court ordered that the applicant pay the respondent's costs of and incidental to the proceedings, but not on an indemnity basis, and only from and including 3 April 2013, in such sum as might be agreed or otherwise assessed.