Re: A Foster Carer v Department of Family & Community Services [No 2]

[2018] NSWDC 71

District Court

New South Wales

Medium Neutral Citation:	Re: A Foster Carer v Department of Family & Community Services [No 2] [2018] NSWDC 71
Hearing dates:	2 March 2018
Date of orders:	29 March 2018
Decision date:	29 March 2018
Jurisdiction:	Civil
Before:	Judge Levy SC
Decision:	1. Pursuant to s 88 of the Children and Young Persons (Care and Protection) Act 1998, the appellant’s costs of the appeal and the consequential application for costs, are assessed in the discounted amount of $23,000; 2. The assessed costs the subject of Order (1) above, are to be paid by the respondent within 14 days of today’s date; 3. Liberty to apply on 3 days’ notice if any further or other orders are required.
Catchwords:	CHILD CARE APPEAL – due to exceptional circumstances the appellant’s costs of the appeal assessed pursuant to s 88 of the Children and Young Persons (Care and Protection) Act 1998 are to be paid by the Department of Family and Community Services
Legislation Cited:	Children and Young Persons (Care and Protection) Act 1998, s 8, s 88, s 90, s 91, s 92, s 93, Civil Procedure Act 2005, s 98
Cases Cited:	Allplastics Engineering Pty Ltd v Dornoch Ltd [2006] NSWCA 33 Amaca Pty Ltd v Phillips [2014] NSWCA 249 Awa v Independent News Auckland Ltd [1996] 2 NZLR 184 Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336 Consumer Commission v Dataline.Net.Au Pty Ltd (2006) 236 ALR 665 Cummins v MacKenzie [1979] 2 NSWLR 803 Department of Community Services v SM and MM [2006] NSWDC 68 Douglas v Lewton Pty Ltd (No 2) [2007] NSWCA 90 Evans v Lindsay [2006] NSWCA 354 Hicks v ATSIC (2001) 110 FCR 582 In the matter of Mr Donaghy (Costs) [2012] NSWChC 11 Keen v Telstra Corp (No 2) [2006] FAC 930 Nikac v Minister for Immigration and Ethnic Affairs (1988) 20 FCR 65 Oshlack v Richmond River Council [1998] HCA 1; 193 CLR 72 R v Dunwoodie [1978] 1 AER 923 R v Kelly [1999] 2 AER 13 R v Lowery [1993] Crim LR 225 R v Okinikan [1993] 1 WLR 173 R v Sanderson [1993] Crim LR 224 Re: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360 Re Michael Barbaro [2004] VSC 404 Roberts v Rodier [2006] NSWSC 1084 SP v Department of Community Services [2006] NSWDC 168 Sheborne Estate (No 2); Vanvalen v Neaves [2005] NSWSC 1003; (2005) 65 NSWLR 268 The Secretary, Department of Family and Community Services (NSW) and the Knoll Children (Costs) [2015] NSWChC 2
Category:	Costs
Parties:	A Foster Carer (Appellant) The Secretary, Department of Family and Community Services (First defendant) Child’s mother (Second defendant) Independent Children’s Lawyer (Third defendant)
Representation:	Counsel: Ms C Smith (Appellant) Mr C McGorey (First defendant) Ms D Pickering (Second defendant) Mr B Saunders (Third defendant)   Solicitors: James McConvill (Appellant) Crown Solicitor (First defendant) McVittie Legal (Second defendant) Barry Saunders (Third defendant)
File Number(s):	2017/241988
Publication restriction:	Non-publication order

Judgment

Table of Contents

Costs application in care proceedings	[1] – [2]
Background to the application for costs	[3] – [6]
Issue to be determined	[7]
Non-publication order	[8] – [9]
Costs jurisdiction conferred by legislation	[10] – [11]
Legal principles to be applied	[12] – [26]
Evidence	[27] – [28]
Facts not in dispute	[29] – [70]
General approach to this application	[71] – [72]
The way FaCS conducted the appeal	[73] – [81]
Costs submissions on behalf of the appellant	[82] – [84]
Costs submissions on behalf of FaCS	[85]
Consideration	[86] – [134]
(1) Argued claim of co-supported merit	[87] – [93]
(2) Claim appellant was “difficult”	[94] – [95]
(3) Claim of residual “question marks”	[96] – [97]
(4) Claim of insufficiency of undertakings as to risk	[98]
(5) Claim of multi-stranded argument	[99] – [109]
(6) Claim of “good evidence” supporting findings	[110] – [123]
(7) Claim that high threshold was met	[124] – [127]
(8) Replenishment of financial resources	[128] – [132]
(9) Actual rather than undiscounted costs	[133] – [134]
Conclusion on costs submissions by FaCS	[135]
Finding that exceptional circumstances have been established	[136] – [142]
Specific gross sum order for costs	[143] – [151]
Ex-gratia payment recommendation	[152] – [158]
Orders	[159]

Costs application in care proceedings

1. This is an application made pursuant to s 88 of the Children and Young Persons (Care and Protection) Act 1998, (the “Act”) for an order for costs in care proceedings.

2. The costs applicant is the successful appellant in a child care appeal from orders made in the Children’s Court. She claims exceptional circumstances that justify an order for her legal costs of the appeal to be paid by the respondent, the Secretary, Department of Family and Community Services (FaCS), where FaCS unsuccessfully resisted her appeal to this Court.

Background to the application for costs

3. The underlying appeal concerned an application by the appellant, pursuant to s 90 of the Act, seeking the rescission of previous orders of the Children’s Court and the allocation to her, of the parental responsibility for a child formerly in her foster care. That appeal was determined in her favour on 15 December 2017: Re: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360.

4. In those proceedings, it was found that the appellant had suffered an injustice that occurred in the investigation phase of events that led to the removal of that child from her care, and which then led to the appealed proceedings in the Children’s Court.

5. The appeal proceedings were finalised in this Court on 9 February 2018, when final orders were made approving a new care plan providing for the child the subject of the proceedings to be returned into the care of the appellant.

6. On 9 February 2018 at the hearing of the approval of the new care plan, a counsel for FaCS sought a stay on the orders made on 15 December 2017 because it was contemplating initiating proceedings for judicial review of the findings in the appeal. On an inquiry of counsel, no arguable grounds for judicial review could be identified. Therefore, the application for a stay was refused. On 2 March 2018, in the course of receiving the submissions of the parties on the costs application, I was informed that no proceedings seeking judicial review had been instituted. Accordingly, the orders made in the proceedings on 15 December 2017 and 9 February 2018 remained operative.

Issue to be determined

7. The residual issue to be now determined is whether exceptional circumstances have been shown to exist that justify an order for FaCS to be ordered to pay the legal costs that the appellant has incurred in the appeal proceedings, and if so, in what amount.

Non-publication order

8. The non-publication order made on 6 November 2017 at the commencement of the hearing of the appeal in this Court concerning names and identification details, continues to apply in respect of this application for costs.

9. In the ordinary course of events, in the interests of open justice, the FaCS delegated care agency referred to in the proceedings, and its employee investigators and managers whose actions were critically evaluated in those proceedings, would normally have been identified. However, the only reason those identities were ordered to remain suppressed in these proceedings is because otherwise, there would be a tendency to reveal the identity of the child the subject of the appeal, an outcome which would not be in that child’s interests, or in the public interest.

Costs jurisdiction conferred by legislation

10. The jurisdiction to order costs in this case is governed by the terms of the Act, s 88 which provides as follows:

“88 Costs

The Children’s Court cannot make an order for costs in care proceedings unless there are exceptional circumstances that justify it in doing so.”

11. Although that section refers to costs orders made by the Children’s Court, since it also refers to care proceedings, there is no dispute that the section also governs and provides for orders for costs incurred in respect of an appeal from the Children’s Court to the District Court: s 91(6) of the Act.

Legal principles to be applied

12. The legal principles to be considered and applied in this case have been identified in a decision of the President of the Children’s Court of NSW, Judge Johnstone: The Secretary, Department of Family and Community Services (NSW) and the Knoll Children (Costs) [2015] NSWChC 2, at [20] – [26] [“Knoll”]. I gratefully draw upon that decision for guidance in this case.

13. A factual finding of the existence of exceptional circumstances must necessarily be case dependent. In Knoll, at [26], it was observed that the array of relevant factual situations that could comprise “exceptional circumstances” within the meaning of s 88 of the Act, were not exhaustively defined or limited.

14. In these proceedings, I recognise that the exercise of a discretion to award costs in exceptional circumstances must be exercised judicially, according to the rules of reason, fairness and justice, not arbitrarily, and not influenced by considerations of benevolence or sympathy.

15. As cited in Knoll, the relevant considerations include the evidence adduced in the proceedings, the conduct of the parties, and the ultimate result, following Knight & Clifton [1971] Ch 700, whilst also recognising that the purpose of an order for costs is to compensate the person in whose favour the order is made, and not to punish the unsuccessful party: Allplastics Engineering Pty Ltd v Dornoch Ltd [2006] NSWCA 33, at [34]; Douglas v Lewton Pty Ltd (No 2) [2007] NSWCA 90, at [22].

16. Other cases where s 88 of the Act has been invoked and considered have been determined on the basis of the exercise of discretion according to the underlying intrinsic factual circumstances of those cases, for example: SP v Department of Community Services [2006] NSWDC 168; Department of Community Services v SM and MM [2006] NSWDC 68.

17. Since the outcome of the present application will be determined by whether or not a finding of exceptional circumstances is made, it is instructive to survey a range of other cases where the abstracted meaning of the term “exceptional circumstances” has been generally considered.

18. In situations where exceptional circumstances are not exhaustively defined in the legislative provision under consideration, that expression must be construed as: “an ordinary English adjective, and not a term of art. It describes a circumstance which is such as to form an exception, which is out of the ordinary course, as unusual, or special or uncommon. To be exceptional, a circumstance need not be unique or unexpected, or very rare; but it is not one that is regularly, or routinely, or normally encountered”: R v Kelly [1999] 2 AER 13, at 20 per Lord Bingham CJ.

19. In Awa v Independent News Auckland Ltd [1996] 2 NZLR 184, at 186, it was held that “the term ‘exceptional circumstances’ ” when used in a statute, is never free from difficulty. As a matter of general approach, the term is usually construed as meaning something “quite out of the ordinary”.

20. In Nikac v Minister for Immigration and Ethnic Affairs (1988) 20 FCR 65, at 81, Wilcox J held that: “the term ‘exceptional circumstances’ postulates a criterion which is both vague and subjective”, and “[l]ike beauty, ‘exceptional circumstances’ lies in the eyes of the beholder”. That interpretation was subsequently considered and approved in Hicks v ATSIC (2001) 110 FCR 582, at 586 – 587.

21. In R v Dunwoodie [1978] 1 AER 923, the term “exceptional circumstances” was construed to mean that “the circumstances must be exceptional to the particular case”.

22. In R v Okinikan [1993] 1 WLR 173, it was determined that : “What are exceptional circumstances depends on the facts of each individual case”. In another instance, “exceptional circumstances” were considered to be “sufficiently wide to allow the court to take into account all the relevant [surrounding] circumstances”: R v Sanderson [1993] Crim LR 224; R v Lowery [1993] Crim LR 225.

23. In Re Michael Barbaro [2004] VSC 404, at [7], it was held that “exceptional circumstances should not be defined; but rather, one should exercise the facts and see if those facts show circumstances which are exceptional”.

24. It follows from the above survey, that the term “exceptional circumstances” should not be construed narrowly, and in this context, it should be construed according to the particular circumstances of the case.

25. As observed in Knoll, at [27], it is not necessary to review the individual factual circumstances of the cases where s 88 has been considered and applied because the enabling statute in this instance has not sought to confine what might constitute “exceptional circumstances”.

26. In light of the guidance from those cited examples of how the meaning of the term exceptional circumstances should be construed, it becomes necessary to review the facts of this case insofar as those facts have a relevant impact on how the claimed costs came to have been incurred by the appellant.

Evidence

27. In addition to referring to the evidence tendered in the substantive appeal, the evidence adduced in support of this application for costs comprised an affidavit affirmed by the appellant on 15 February 2018.

28. That affidavit also annexed a summary from her solicitor, describing and stating the value of the relevant legal work that had been carried out on the appellant’s behalf. Also tendered, were copies of a series of costs agreements entered into between the appellant and her lawyers. Neither the appellant nor her solicitor was required for cross-examination on the evidence tendered on the applications for costs.

Facts not in dispute

29. For context, a summary of the historical background, the evidence, and the outcome of the appeal proceedings, now follows.

30. The child the subject of the appeal was placed into the care and parental responsibility of the Minister for Family and Community Services from the time shortly after her birth. At no time was there any prospect of the child being restored to her parents. Since May 2009, when the child was 10 days old, and until removal, the appellant had been the child’s foster carer. Beforehand, since February 2008, the appellant had also been the assigned foster carer of that child’s two older brothers.

31. In February 2010, the Minister’s delegate assigned a non-government care agency, which had, and still continues to have, a significant experience and presence in the field of child care, to supervise and to manage those foster care arrangements involving the appellant and the child the subject of the appeal. The events which have led to this costs application occurred under the watch of that agency.

32. In September 2015, the child, then aged 6 years, and her two older brothers, were removed from the appellant’s care.

33. That removal was against a background of events two years earlier, in 2013, when the child’s brothers, or at least one of them, who at that time was shown to have a prior history of lying, and had made mischievous complaints of abuse by the appellant. Those allegations were strongly denied by the appellant from the outset.

34. Those 2013 complaints by the brothers of alleged abuse by the appellant were investigated by the care agency and found to have been unsustained. This was in part because there was a history of the brothers having behavioural difficulties, and of lying when in trouble.

35. On 31 August 2015, the two brothers made complaints of ill-treatment against the appellant.

36. Consequently, in September 2015, the care agency was mandatorily obliged to investigate the newly made allegations, and in the meantime, interim protective measures were taken for the removal of the children from the appellant’s foster care, pending the outcome of that investigation.

37. After more than 6 years of continuous care by the appellant, and as a consequence of what I have found on the appeal to have been a deeply flawed care agency investigation report, which purportedly “sustained” the allegations against the appellant, the child the subject of the proceedings, and that child’s siblings, were then permanently removed from the appellant’s foster care.

38. The appellant then became the subject of a series of cascading legal adversities that were ultimately the subject of remedial findings on appeal, except as to costs, hence her present application for costs.

39. The care agency investigation report which based those events amounted to little more than a recitation of a list of concerns, without evidence of an adequate investigation and evaluation of the underlying evidence with regard to those concerns: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360, at [3] and [349].

40. Consequent upon the removal of the children, the NSW Office of the Children’s Guardian cancelled the appellant’s clearance certificate for working with children. The appellant then felt compelled to pursue her legal remedies in respect of that cancellation, and she has challenged that decision in the NSW Civil and Administrative Tribunal (“NCAT”).

41. The evidence disclosed that the NCAT proceedings, and some related Supreme Court proceedings, have involved the appellant incurring considerable legal expense, as well as creating great disruption to her situation, all of which has adversely impacted upon her and her otherwise good reputation.

42. In the course of those events, the appellant has expended in excess of $100,000 in legal fees in respect of those proceedings. That expenditure has exhausted her personal savings, and she has also been left with consequential credit card debts of approximately $50,000.

43. At this point I am careful to observe that the costs and expenses incurred by the appellant in the NCAT and Supreme Court proceedings, do not form the basis of, and are not the subject of, this costs application. The above summary is merely set out as comprising the appellant’s relevant background circumstances.

44. In the course of those described events, the appellant felt compelled to initiate the appealed proceedings in the Children’s Court. She did so in order to seek to have allocated to her, the parental responsibility for the child the subject of the care proceedings. She sought those orders as the only course open to her in view of the effect of the cancellation of her clearance certificate.

45. The principal issue in those proceedings was the consideration and the determination of the paramount best interests of the child the subject of those proceedings. That application by the appellant was resisted by FaCS, and after a considerable period of deliberation, the Children’s Court refused the appellant’s application.

46. To fund her unsuccessful application to the Children’s Court, the appellant had sold a number of items of personal property. These included her jewellery, a dining room table and six chairs, another dining room table and eight chairs with a matching buffet, as well as a television cabinet, and a sound system.

47. Following the appellant’s unsuccessful application to the Children’s Court, the evidence shows that, notwithstanding the considerable legal work undertaken by the appellant’s lawyers in respect of those proceedings, and out of consideration for the appellant’s circumstances of hardship, the appellant’s lawyers generously reduced their disclosed professional fees and charges for the work they undertook for her in those proceedings. The reduction was from $74,368.75, down to $57,172.50.

48. As observed at paragraph [25] above, those costs are set out as part of the relevant background circumstances, and do not form the basis of the present claim.

49. The appellant felt dissatisfied by the orders of the Children’s Court which had denied her application for the allocation to her of parental responsibility for the child in question. As a result of that dissatisfaction, she then decided to appeal to this Court from the decision of the Children’s Court. The appeal to this Court involved a de novo hearing of her application to the Children’s Court: s 91(2) of the Act.

29. At that point in the timeline of events, the costs the subject of the present application began to be incurred by the appellant.

30. A de novo hearing on appeal has the effect of dissolving and rendering inoperative, the appealed decision of the Children’s Court, so that disputed matters may be re-examined, re-argued, and so that fresh findings may be made if required.

31. A de novo hearing on appeal permits a flexible approach, where fresh evidence may be called, or evidence in addition or substitution may be called to that which was called at first instance in the Children’s Court, and the transcript and exhibits tendered in the earlier proceedings may also be admitted into evidence on the appeal: s 91(2) and (3) of the Act.

32. The parties conducted the appeal in this Court economically, with those provisions in mind.

33. Having already exhausted her own financial resources in the Children’s Court proceedings and in the other identified proceedings, the appellant pursued an application for legal aid to mount her appeal from the decision of the Children’s Court.

34. After extensive submissions made to the Legal Aid NSW Grants Division on the appellant’s behalf, her application for legal aid to fund the appeal from the Children’s Court to this Court, was denied.

35. The apparent reason given for that denial was that the legal aid authority considered that the appeal proposed by the appellant had little prospects of success.

36. Although in this costs application it is not necessary to examine the detail of the reasons for the refusal of legal aid, I observe that application for legal aid was based on the materials that were before the Children’s Court, including the obviously flawed, unfair and unjust care agency investigation report, of which the appellant had complained throughout.

37. Notwithstanding the refusal of legal aid, the appellant was determined to pursue an appeal to this Court from the decision of the Children’s Court.

38. In those events, and to assist the appellant in that regard, her lawyers decided to provide her with their professional services for the appeal at a considerably reduced cost in relation to their professional fees.

39. To prosecute her appeal, for financial reasons, the appellant, who works as a casual assistant nurse, felt compelled to move out of her home. She moved to live in another area, to her daughter’s home, in order to conserve her wages to help fund her appeal. She also funded the appeal with some financial assistance from her family. She borrowed $6000 from her son, and she sold further items of her personal property, comprising her car, her outdoor furniture, some brand named dresses, a desk, bookshelves, and a near new upright freezer. She is presently in the course of slowly repaying her debts to family members.

40. A detailed breakdown and summary of the legal costs the appellant has incurred in the appeal was annexed to the appellant’s affidavit and the work that underpinned those costs was not disputed. That document, comprising the solicitor’s costs summary, shows that her solicitors and her counsel had, on account of a recognition of the appellant’s circumstances of severe hardship, generously reduced the combined total amount of their professional fees for the appeal proceedings, from $36,052.50, down to $13,860.

41. In circumstances where legal aid was unavailable to the appellant, that generous fee reduction by the appellant’s lawyers was made honourably, and in accordance with the best traditions of service provided to the public by members of both branches of the legal profession.

42. In addition to those reduced costs in the amount of $13,860, on the present costs application, the appellant has also incurred legal fees for services provided by her solicitors and her counsel, at properly disclosed, and what I consider to be patently reasonable, rates of charge, in the total undiscounted amount of $10,000. The total of those amounts is $23,860.

43. Although FaCS submitted that those costs should be discounted if a specific gross sum cost order was to be made, FaCS otherwise fairly conceded the fairness and reasonableness of that total sum, which, if a cost order is made, enables the parties to avoid incurring further inconvenience, delay and expense that might otherwise be associated with a contested costs assessment: T192.17 – T192.23.

44. In considering the above factual summary, particularly the fee reduction referred to at paragraph [61] above, when due recognition is given to the costs indemnity principle, it is clear that the appellant’s present application for costs must necessarily be limited to the amount of $23,860 and not the actual and higher value of the work at the disclosed rates that was carried out on behalf of the appellant before that amount was reduced out of consideration to the appellant’s circumstances: T189.22; T190.15.

45. The foregoing summary necessarily reveals that an order for costs in the amount claimed in this application, will not place the appellant back into the financial position that she was in at the time she incurred the full effects of the injustice that I found had occurred in respect of the deeply flawed investigation report undertaken by the care agency investigators.

46. Those events have occurred in unfortunate circumstances where the FaCS assigned care agency investigators, and their managers, took the conscious decision to decline to follow a series of supervisory recommendations made by the Office of the NSW Ombudsman. Those recommendations were aimed at overcoming numerous identified deficiencies that were revealed to be evident in the care agency’s draft investigation report.

47. Notwithstanding those recommendations by the Ombudsman’s office, they were not taken up and pursued. Instead, the care agency investigators and their managers declared their investigation to be final, despite those identified deficiencies. The result was the production of a deeply flawed report, which FaCS relied upon in the Children’s Court, and initially sought to rely upon in the appeal. The analysis which led to the conclusion that the investigation report was flawed, is set out in the principal judgment tin these proceedings: Re: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360.

48. Unfortunately for the appellant, the present costs application cannot be extended to include a claim for consideration of a third party costs order involving the FaCS delegated care agency, which appears to be a not for profit entity that has received public funds for this aspect of its operations.

49. No power resides in the Act for a third party costs order to be made in care cases, as was correctly observed in another decision of the Children’s Court in which third party costs orders were contemplated: In the matter of Mr Donaghy (Costs) [2012] NSWChC 11.

General approach to this application

71. To determine whether exceptional circumstances existed in connection with the appeal, it is necessary to revisit the opening address made by counsel for FaCS in the substantive hearing of the appeal, as well as the closing submissions made on behalf of FaCS. It is also necessary to refer to the submissions made by counsel for FaCS in the course of robust exchanges that occurred in the course of the hearing, during which the basis of FaCS’s position in the appeal was explored.

72. In referring to those matters, I do not intend to convey any impression of criticism of counsel for FaCS, who when putting forward his arguments, did so properly, adroitly and fairly, albeit according to the limitations of the material with which he was briefed and instructed.

The way FaCS conducted the appeal

73. In his opening address, counsel for FaCS made the following headline points to flag an order seeking that the appeal be dismissed:

1. FaCS’s opening position was stated to be in line with the conclusions or findings of the Children’s Court Magistrate: T5.2. Those findings (which are to be found at Tab 22 of Exhibit “A”) were summarised in sufficient detail in the principal judgment in these proceedings and need not be repeated here, other than to note that the fact of the filing of the appeal, which necessarily required a de novo hearing, had the consequence that those earlier findings were no longer operative. Accordingly, there was no need to review the reasons of the Children’s Court for any contended error within those findings: Re: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360, at [69] – [70];

2. In the appeal, FaCS indicated an intention to argue that the appellant had difficulties with aspects of her capacity to care for the child in question in light of alleged difficult interpersonal relations with professionals and school staff: T5.27 – T5.34. That is a matter to which I shall shortly return in my consideration of the issues;

3. FaCS also indicated an intention to argue that the appellant was “closed off” to the views of other professionals involved in providing care to the child, and that she had, in the opinion of the retained expert psychologist, Mr de Laurence, limited insight into the need for respite care arrangements outside her own family: T5.34 – T5.44;

4. FaCS further indicated an intention to argue that the investigated allegations of abuse levelled at the appellant raised a question of an unprovable but nevertheless unacceptable risk of harm despite an inability to make a positive finding that there had been abuse as alleged: T5.45 – T6.1.

74. In his closing address in the appeal, counsel for FaCS relied upon the arguments and conceded positions that are distilled below:

1. On behalf of FaCS, it was conceded the information contained in the care agency investigation report was open to be evaluated by the Court: T177.43;

2. FaCS ultimately conceded that the care agency investigation report was fundamentally and deeply flawed, which resulted in a skewed analysis in the investigation, which lacked procedural fairness: T181.21 – T181.31;

3. FaCS also ultimately conceded that the investigation report had “to be viewed with great caution”: T182.1 – T182.5;

4. Notwithstanding that there were concerns over the fundamentally flawed nature of the investigation report which led to the proceedings, and where, in interchanges, the investigation report was ultimately conceded as being “borderline worthless because of the fundamental failure to afford [the appellant] procedural fairness” (T176.1 – T176.12), it was nevertheless argued on behalf of FaCS, that the report still raised concerns about “a consistent theme of negativity … resistance or unconstructive relationships with … care providers” that was said to justify holding concerns over a relevant risk of harm to the child, and which were unconducive to the needs of the child: T176.32 – T177.5;

5. However, on a critical point raised during argument in the appeal, there was no answer forthcoming on behalf of FaCS to the formulated proposition that the care agency investigation report could not stand as a reliable basis for making any decisions adverse to the appellant because the underpinning material fell short of the required standard of proof having due regard to the serious allegations made against the appellant, and that were purportedly investigated: Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336; T177.12 – T177.28;

6. FaCS ultimately accepted the proposition that on the material presented, when closely examined, it was “a great struggle” to reach a finding on the balance of probabilities to the effect that the particular allegations against the appellant involving child maltreatment had been established: T178.1 – T178.10;

7. Despite the above concessions, the stated fall-back position of FaCS was that of “going forward” to determine the best interests of the child: T180.48. In taking that position, FaCS argued that, as the child had been removed from the appellant’s care (2 years earlier), and was progressing well with a growing attachment in her substituted care placement, there should be no change in the status quo of those arrangements, the effect being, the appeal should be dismissed: T180.21 – T180.35.

75. It is plain from the above summaries, that there was a material change between the opening address made on behalf of FaCS and the concessions and positions adopted on behalf of FaCS in the closing address.

76. In the course of argument, the care agency investigation report was critically examined. This was because it appeared that the so-called “sustained” findings in the care agency investigation report were achieved in an unfair manner, as the investigation had gathered only limited information and had not explored material that was potentially exculpatory of the appellant.

77. A prime demonstrated example of this point was the care agency’s considered view that the cost of travel by investigators to the location of some witnesses to investigate the matters raised was an unwarranted expense. This was notwithstanding that the object of such a step would have been to obtain evidence in the form of proper statements from named witnesses whom the appellant had identified to the investigators as supporting an exculpation of her position: T182.41 – T182.47.

78. This revealed a deep flaw in the investigation process. Following on from that analysis, the finding was made that the report had no probative value concerning its conclusions that were stated to be adverse to the appellant.

79. FaCS had no reasonable answer to the proposition that absent a reasonable basis for the care agency investigators sustaining allegations of, for example, alleged ill-treatment of the child, then that was a sufficient basis to conclude the report should not be given any weight with regard to the allegations made against the appellant because of the underlying unfairness of that investigation: T183.42 – T184.2.

80. To the extent there was an answer to that proposition, the position which FaCS took on the care agency investigation report was that one should look at the underlying information that led to the report being prepared: T184.5. The circularity of that “bootstraps” submission does not withstand scrutiny, and it cannot be accepted because of such circularity.

Costs submissions on behalf of the appellant

81. In support of her application for an order for costs being made in her favour, the appellant’s submissions were essentially to the effect that exceptional circumstances should be found to exist in this case because of the following combination of events:

1. Following the appellant’s unsuccessful application to the Children’s Court, in the course of maintaining its resistance to this appeal from those proceedings, FaCS persisted in seeking to rely upon the content of a deeply and fundamentally flawed care agency investigation report, despite those flaws being clearly highlighted in the course of the Children’s Court proceedings;

2. In the de novo hearing appeal, FaCS chose not to introduce or to adduce further evidence after being made aware of the inadequacies of the care agency investigation report. No further investigation was carried out to assess the validity of the investigation findings where, on the face of the report, it was obvious that the appellant had been the subject of a blatant denial of procedural fairness;

3. In the lead-up to the appeal, a proper pre-hearing assessment of the evidence ought to have demonstrated the unreliability of the findings made in the care agency investigation report, which in turn should have compelled FaCS to reconsider maintaining its resistance to the appeal;

4. An order for costs, in the terms as sought by the appellant, is within the objects of the legislation, as set out in s 8 of the Act;

5. By reason of the appellant having to meet her own legal costs of the appeal, she has been deprived of the benefit of her financial resources, which could and should, once the child is returned to her care, be available to assist her to support that child in a long-term, safe, nurturing and secure permanent placement, especially where that child has significant special needs.

82. I find that on first analysis, each of the appellant’s costs arguments, as outlined above, except for a qualification an aspect of the second limb of the argument identified in sub-paragraph (5) above, are reasonably made, and are open for acceptance to support a finding of the existence of relevant exceptional circumstances in connection with the appeal.

83. My reason for not accepting the second limb of the argument cited at (5) above is that whilst it has a superficial and logical attraction, to accede to that argument in total, it would go beyond the confines of a compensatory costs order and would involve irrelevant considerations of benevolence or sympathy, as cited in Knoll at [26], and as referred to at paragraph [13] above. However, the first limb of that cited submission, which raises the question of compensatory costs to replenish the appellant’s expended financial resources, remains valid and acceptable.

84. The question that then follows is whether, on a consideration of FaCS’s arguments that sought to resist the application for costs, which of the competing arguments should prevail, and why that should be so. I therefore now turn to consider the contrary costs arguments, as made on behalf of FaCS.

Costs submissions on behalf of FaCS

85. In essence, on the costs application, FaCS’s contested the claim of the existence of exceptional circumstances and mounted a resistance to the appellant’s application for costs, as follows:

1. FaCS contended that the position it had adopted in the appeal had merit, and that it was supported by both the child’s independent legal representative and the child’s mother: (“Argued claim of merit that was said to be co-supported”);

2. FaCS’s reiterated the contentions that were considered and rejected on the appeal, where it was argued the appellant’s “difficult” relations with professionals who were involved with the child’s care indicated the situation was not in the child’s best interests, which, it was argued, suggested that there was an unacceptable risk to the child, including from violence by the appellant: (“Claim of appellant’s difficult relations with professionals”);

3. FaCS’s submissions sought to establish some distance from the conclusions of the care agency’s flawed investigation report, and in doing so, FaCS sought for the Court to consider the evidence which grounded those flawed conclusions, even though the appellant challenged the allegations made by the child’s brothers concerning alleged abuse by the appellant, where such allegations were not positively proven on any reasonable standard, other than raising a suspicion: (“Claim of residual question marks over unproven allegations”);

4. FaCS argued that the appellant’s undertakings, as given to the Children’s Court, were, as found by the Children’s Court, to be insufficient to mitigate against the risk of violence due to stress or frustration on the part of the appellant: (“Claim of insufficiency of undertakings to mitigate risk”);

5. FaCS argued that the evidence that lay behind the flawed care agency investigation report cannot be said to be an error of fact. FaCS further argued that evidence, which was criticised in the appeal, was not “fundamental” to FaCS’s case because the allegations by the child’s brothers only represented one strand of the Secretary’s case: SP v Department of Family and Community Services [2006] NSWDC 168: (“Claim of multi-stranded argument”);

6. FaCS argued it was entitled to rely on the investigated allegations which had resulted in the Children’s Court finding that there was “some good evidence, in support of the [investigation] findings which had been made”, in circumstances where the appellant bore the onus, and FaCS was not obliged to obtain and adduce fresh evidence about the allegations: (“Claim of existence good evidence to support the investigation findings”;

7. FaCS relied on the decision in Department of Family and Community Services v SM and MM [2008] NSWDC 68 where there was a dismissal of the appeal on grounds of lack of merit, to argue that the appellant should pay her own costs of the appeal. FaCS contested the claim of exceptional circumstances by again arguing its position that the appeal had merit, and by maintaining that the fact that the plaintiff paid her own legal costs is not relevant to the exercise of the discretion to award costs: (“Claim that the high threshold for costs has not been met”);

1. FaCS argued that the award of costs aimed at replenishing the appellant’s finances so as to assist the appellant to provide care for the child should be rejected as it did not form a proper basis for a costs order in the circumstances: (“Replenishment of financial resources”);

2. FaCS argued that the generosity of the appellant’s lawyers in reducing their fees is not a relevant costs consideration to assess costs for an amount higher than the amount that they had actually billed to the appellant: (“Submission that actual and not undiscounted costs should be awarded”).

Consideration

86. In the paragraphs that now follow, and adopting the same enumeration of the above points, I now turn to evaluate each of those cited arguments.

(1) Argued claim of merit that was co-supported

87. The claim by FaCS of merit in its position taken in the appeal, as outlined at sub-paragraph (1) of paragraph [85] above, appears problematic for several reasons. In my view, the argument of a claim of merit in the position taken in the appeal by FaCS, and the claim of co-support of that position, are separate questions that should not be linked in the manner submitted by FaCS on the costs application.

88. The argument asserting a position of merit by FaCS has already been considered and rejected by my findings in the principal proceedings where the claim of merit was rejected on the grounds of a fundamentally flawed care agency investigation report.

89. The argument that both the independent legal representative of the children and the legal representative of the mother of the children supported the position taken by FaCS, is another “bootstraps” or circular argument that does not withstand scrutiny. The weight of numbers through co-support does not make the argument compelling.

90. Furthermore, that argument as summarised above, does not give due recognition to the fact that the independent legal representative of the children had a potential conflict over what was the best interests of the child the subject of the appeal, as distinct from the best interests of the two brothers of that child, in circumstances where those brothers did not want to return to the appellant’s care. Whilst their views were perhaps understandable given the ramifications of a past proven history of lies having been told about the appellant, the issue of their care was not a question to be determined in the proceedings.

91. Insofar as the position of the allocation or placement of the child the subject of the appeal was concerned, that matter was resolved by an analysis of the evidence concerning the fact of the strength of the attachment of the child to the appellant, a matter upon which, neither the child’s biological mother nor FaCS could make any contra-preferential argument.

92. The submissions on behalf of the biological mother in support of the position taken in the appeal by FaCS were not based on any fresh evidence given by her in the appeal. This was in circumstances where the biological mother had an intellectual impairment, and she had no other active role or voice in the proceedings. Her representation was more of a formal, rather than of a substantive nature as there was no prospect of the child ever being restored to her care, and there was no real issue about her continued contact with the child. Her rights to contact visits remain undisturbed. Her representation added little to the consideration.

93. The argument of a co-supported position between those parties to simply support FaCS’s position without recognising the deeply flawed nature of the care agency’s investigation report was circular as outlined above, and I therefore do not accept that argument.

(2) Claim of appellant’s “difficult” relations with professionals and risk

94. As to the claim on behalf of FaCS of the appellant’s “difficult” relations with professionals in the child care setting outlined at sub-paragraph (2) of paragraph [85] above, citing Department of Family and Community Services v SM and MM [2008] NSWDC 68, those submissions were evaluated in some considerable detail and rejected at the substantive hearing, where it was determined that the claim of “difficult” relations lacked reasonable foundation and merit because of the flimsy nature of the underlying assertions.

95. Those assertions could not be reasonably substantiated on the required legal analysis: Re: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360. The “difficult” relations relied upon by FaCS simply referred to the fact that the appellant was a robust advocate for the child’s needs when dealing with teachers and health care workers who had different, and at times incompletely informed opinions. I therefore do not accept the argument of a claim of merit in the position adopted by FaCS.

(3) Claim of residual “question marks” remaining over unproven allegations

96. As to the claim of residual “question marks” remaining over unproven allegations against the appellant, as outlined at sub-paragraph (3) of paragraph [85] above, that argument should be seen to be flawed as it drew upon the reasons of the Children’s Court, which were no longer operative by reason of the advent of the appeal. The de novo nature of the appeal hearing meant that the evidence considered by the Children’s Court was open to be, and was required to be, freshly evaluated. It was therefore irrelevant for FaCS to rely upon those earlier findings to seek to now argue that there was merit in its position to seek to rebut the claim of exceptional circumstances, especially where FaCS’s position was based on the flawed care agency investigation report.

97. In any event, as the submission by FaCS acknowledged, the Children’s Court did not make a finding that the allegations in question were “substantiated”. The “question marks” that arose were shown on appeal to be, if not baseless, then so unfair, as to be unreliable, due to the underlying shoddy nature of the care agency investigation: Re: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360.

(4) Claim of insufficiency of undertakings to mitigate against risk

98. As to the claim of alleged risk of violence whilst in the care of the appellant outlined at sub-paragraph (4) of paragraph [85] above, that argument is as fundamentally flawed as was the underlying care agency investigation report upon which it was based. The allegations of presumed and argued risk of violence were based on inadequately investigated and untested assertions that did not withstand reasoned scrutiny. They emerged from a one-sided investigation. FaCS’s reliance on such matters amply demonstrates the existence of exceptional circumstance, which supports the need for a compensatory costs order in this case: Knight & Clifton [1971] Ch 700, as cited in Knoll, and referred to at [15] above.

(5) Claim of multi-stranded argument

99. As to the claim that the flawed investigation report was not “fundamental” to FaCS’s case, as outlined at sub-paragraph (5) of paragraph [85] above, I consider that argument must be rejected because it seeks to downplay and avoid the unjust cross-over consequences of the flawed care agency investigation report.

100. The argument advanced by FaCS to the effect that the evidence of the child’s brothers, which related to risk of harm, and which was considered unreliable, was “only one strand” of FaCS’s case, was neither compelling nor determinative.

101. This is because the “other strands” were said to be the child’s attachment to the new carer, the child’s apparently good adjustment to her new environment in which she was progressing well with that carer, and again raising the negative “recurrent theme in the professionals’ reports concerning their interactions” with the appellant, alleging she was “resistant” to their attempts to engage the child in activities.

102. FaCS’s reference to the evidence of the appellant’s own psychologist concerning her counselling needs was misplaced because that submission failed to recognise that the stress counselling sought by the appellant was consequential upon the circumstances of injustice that had been visited upon her by the flawed investigation. The veiled criticism of the appellant as made by FaCS, was to the effect that the appellant needed to develop strategies to manage conflict situations. That submission ignored completely the misinformed and inadequately reasoned commentaries from the professional witnesses who were interviewed by the investigators, where at times, their views resulted in the appellant rightly and robustly disagreeing with some of the observations of those persons, and where some of those persons ultimately declined to provide evidentiary statements to back up their criticisms of the appellant.

103. The appellant’s disagreement with the observations of those persons came from a far better position of being informed on the issues than those persons, whose intimated views appeared to have caused the investigators and FaCS to adopt an adversarial stance against her.

104. Accordingly, FaCS’s reliance on SP v Department of Family and Community Services [2006] NSWDC 168, was unsupportable in the circumstances.

105. The “recurrent theme” of negativity relied upon by FaCS was the equivalent of unsubstantiated whispers. The proper construction of those events was that the appellant was plainly a concerned and at times robust advocate for the needs of the child in circumstances that involved the input of others, such as teachers, who raised a dietary concern. There was no evidence of the child being harmed by such advocacy. The suggestions of harm, such as a claim of dietary restriction, and the claim of lack of stimulation of the child, when analysed, simply fell away as being unsubstantiated on the evidence.

106. It was therefore spurious for FaCS to again raise these discredited matters in the form of a claimed “recurrent theme” of negativity in this context, especially where these comments arose from the products of a flawed investigation and a flawed care agency investigation report.

107. It was also spurious for FaCS to again raise the matter of the child’s growing attachment to the new carer as an argument for not disturbing the new status quo of the child’s placement, where there was compelling evidence that the child’s attachment to the appellant had remained unbroken, as would be expected after 6 years of continuous care, and where this was only interrupted by the consequences of a deeply flawed investigation by the care agency investigators.

108. The residual argument that the appellant’s own psychologist had suggested that she needed help to identify better strategies “to manage conflict situations” is more telling against the management and supervision of the child’s placement by the care agency than it is against the appellant. This is where agency staff turnover and limited case worker familiarity with the child was an apparent source of the appellant’s frustration and her need to exercise firm advocacy for the child.

109. In my view, for the reasons outlined above, the multi-stranded argument relied upon by FaCS has been shown to be somewhat frayed and unreliable. I do not accept that argument.

(6) Claim of “good evidence” to support investigation findings

110. Accepting that s 93(1) of the Act provides that the Children’s Court, and therefore the appeal jurisdiction of this Court, are not to be exercised or conducted in an unduly adversarial manner, and accepting also that s 92(2) of the Act requires that the proceedings are to be conducted with as little formality, and legal technicality and form as the circumstances of the case permit, the construction of those provisions must nevertheless have regard to some fundamental and rational qualifications to those stated principles.

111. Such qualifications include the requirement of ensuring procedural fairness, and the need for acceptable evidence to exist to form a reasonable basis of for decisions to be made on the balance of probabilities on important questions.

112. In that latter regard, a further important qualification is that where findings are sought or purported to be made against an individual based on allegations over the conduct of that individual concerning alleged ill-treatment of children, the standard of satisfaction to be applied is that of proof on the balance of probabilities but weighted according to the gravity of the conduct alleged against the individual: Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336.

113. The allegations against the appellant concerning claims of ill-treatment of a child or children in her care are sufficiently grave to require an assiduously thorough but fair investigation. In his evidence, the care agency investigator acknowledged that proposition.

114. The investigation undertaken by the care agency and its investigators, where exculpatory witnesses identified by the appellant were not approached or interviewed by the investigators, cannot be reasonably considered to be either assiduously thorough, or fair.

115. In such circumstances, the untested and unexplored state in which the care agency investigators left the evidence that they had gathered in their investigation, which was left as being weighted against the appellant, cannot in this context be properly or reasonably described as “good evidence”, as was submitted by FaCS.

116. Whilst the “evidence” gathered by the care agency investigators might pass a threshold test for deciding there was a prima facie justification for further investigation, it did not meet the requirements justifying the description of “good evidence” supporting the investigation findings, which at the closure of the investigation, resulted in “sustained” findings, which remained fundamentally flawed by the conscious decision of the care agency investigators and manager to truncate that investigation on grounds of cost.

117. The reference to a “finding” by the Children’s Court of “good evidence” is a mischaracterisation. FaCS’s submission referring to the Children’s Court findings about the allegations had “some good evidence in support of the finding which had been made” must be seen to be as being a spurious submission.

118. This must necessarily be so because the investigation “finding” was unsupported by the required process of reasoning on the part of the investigators. The fact that the Children’s Court referred to “some good evidence” did not mean it was a conclusive finding based on a process of reasoned evaluation. The reference to a “finding” by the Children’s Court is therefore a mischaracterisation. The allegations remained unevaluated. Even if there was such a finding, the reasoning of the Children’s Court did not form the basis for the outcome of a contested de novo hearing.

119. To the extent that the cited decision of the Children’s Court considered that there was good evidence to support the investigation findings, there are three further things to be said of that, as follows.

120. First, that conclusion was no longer operative in the appeal proceedings by reason of the de novo appeal. It was therefore fallacious for FaCS to here cite those conclusions to seek to rebut the claim of exceptional circumstances. Secondly, to the extent that FaCS wished to continue to support the view there was “good evidence” to support the investigation findings, it was necessary to examine that evidence for its cogency and fairness. Thirdly, the so called “good evidence” did not withstand reasoned scrutiny to justify maintaining the description of that evidence as “good evidence”.

121. Whilst it is correct that FaCS was not obliged in the appeal to obtain and adduce fresh evidence about the allegations against the appellant because the appellant bore the onus of proof on the claim she made, FaCS nevertheless relied upon the flawed care agency investigation report, which was exposed as unreasonable.

122. That characterisation should have been obvious as a consequence of the critical matters raised by the Office of the NSW Ombudsman, and which the agency ignored. In those circumstances, FaCS’s reliance on the evidence of the allegations was destined to be seen as lacking substance or persuasive merit. That position was so out of the ordinary to make constitute exceptional circumstances.

123. I therefore reject the submission that there was “good evidence” to support the investigation findings. That rejection was explained more fully in the principal judgment: Re: A Foster Carer v Department of Family & Community Services [2017] NSWDC 360.

(7) Claim that high threshold for a cost order is not met

124. As to the claim of there being a high unmet threshold required for a finding of exceptional circumstances because FaCS’s case had merit, as outlined at sub-paragraph (9) of paragraph [85] above, in my view that argument cannot be accepted. That must be so when it is recognised that the perception of merit, as argued by FaCS, was baseless, because the underlying investigation was flawed and unbalanced.

125. The investigation was unbalanced and unfair because where the investigators did not take the required steps to fairly assess the potentially exculpatory evidence identified by the appellant, and which had the real potential to rebut the allegations made against her.

126. The Office of the NSW Ombudsman, in its supervisory role, recognised this problem and drew the attention of the care agency investigators to that fact. It was an extraordinary circumstance that the care agency investigators did not follow the Ombudsman’s supervisory recommendations.

127. It was equally extraordinary that FaCS, when seized of those facts, chose to support the flawed investigation, not only in the Children’s Court, but also in the way in which it did so in the appeal. I consider that latter circumstance satisfactorily amounts to exceptional circumstances within the meaning of s 88 of the Act.

(8) Replenishment of financial resources

128. FaCS’s claim that the appellant’s claim for costs should be refused because the appellant’s need for funds to support the child does not amount to exceptional circumstances, as outlined at sub-paragraph (10) of paragraph [85] above, should not be accepted.

129. This is because FaCS’s submission on this point has misconceived the basis of the appellant’s submission. An order for costs arises in this case only if exceptional circumstances are shown. The order is not intended to “bypass” the threshold of exceptional circumstances, as FaCS’s submission suggests.

130. The basis of the appellant’s claim for an order for costs in this case is not in order to obtain funds to support the child in the future, but to compensate her in relation to her costs burden in circumstances where she has exhausted her financial resources, and where she has succeeded in her appeal, in the context of her claim of exceptional circumstances. An order for costs is compensatory of those factors, and is not intended as a financial benefit. She incurred those costs when FaCS determined that her appeal should be resisted.

131. If the consequence of an order for costs has the ultimate effect of in part replenishing the appellant’s financial resources so as to enable her to better support the needs of the child when in her care, then so be it, but that is not the principal object of the claimed order for costs. It is a flow-on effect, which in this instance, happens to coincide with the dictates of justice, once the threshold test of the existence of exceptional circumstances has been demonstrated.

132. The financially replenishing effect of an order for costs is to in part restore the appellant’s funds that were expended on costs. Once she receives such funds, she would be entitled to spend those funds in a manner in which she sees fit. The position is no different to a compensatory damages award in the hands of an injured plaintiff: Amaca Pty Ltd v Phillips [2014] NSWCA 249, at [34]; Evans v Lindsay [2006] NSWCA 354, at [112] – [113].

(9) Actual rather than undiscounted costs

133. As to FaCS’s submission that there should be a costs assessment to permit a costs assessor to consider questions of reasonableness rather than notions of “generosity” on the part of the plaintiff’s legal representatives, that submission was overtaken by events during the course of oral submissions, when, on instructions, a concession of reasonableness was made: T192.17 – T192.23.

133. The only claim the appellant can make is for quantified costs for the professional costs that her lawyers have identified, namely $23,860. This is conceded on her behalf: T190.9 – T190.10. There is no claim for what is the substantial difference between those discounted costs and the disclosed undiscounted value of those costs. There is no contest on this issue, although it is an unsatisfactory outcome for the appellant’s lawyers, who have at all times acted in good faith in ensuring she had access to justice whilst impecunious, and where, regrettably, there was no legal aid available to her.

Conclusion on costs submissions made on behalf of FaCS

135. In summary, for the reasons outlined above, I reject the submissions made on behalf of FaCS where it contested the appellant’s contention that exceptional circumstances have been relevantly demonstrated in this case, within the meaning of s 88 of the Act.

Finding that exceptional circumstances have been established

136. I find that in this case, FaCS took the course of resisting the appeal in the readily apparent knowledge that the care agency investigation report was fundamentally flawed. This was because it was relevantly unreasoned insofar as it purported to sustain findings of child ill-treatment by the defendant. It was also fundamentally flawed because it was based on an investigation that was truncated on account of cost, and which did not explore potentially exculpatory evidence in favour of the appellant’s position.

137. If there was any room for doubt about those conclusions, any such doubts are dispelled on recognising, as was plainly apparent from the documents relied upon by FaCS in the appeal, that the further investigatory recommendations by the Ombudsman had not been carried out. That matter was a fundamental deficiency which was glossed over. FaCS permitted the case to go forward against the appellant in reliance of inadequately investigated suspicions. That was fundamentally unfair to the appellant.

138. It is one thing for the care agency to have so glaringly abrogated its investigatory responsibilities by deciding not to take statement from witnesses who would have potentially exculpated the appellant. The investigator explained that circumstance on the shameful grounds that his manager had decided the cost of pursuing further investigations contraindicated that course. It is noteworthy that at the substantive hearing, the care agency manager of investigations who made the decision not to follow the Ombudsman’s investigative recommendations was present at Court during the hearing of the appeal (T108.17 – T108.21), but was not called to give evidence to justify that decision.

139. It is quite another thing for FaCS, in reviewing that material, to decide to resist the appellant’s case on appeal by defending the proposition raised by the care agency investigator that the series of brief emails proffered to the investigators by the appellant in support of her position, relevantly constituted, or were the equivalent of, evidentiary statements. When those materials were examined, it became obvious that explanation by the investigator was a hollow one, and was not reasonably maintainable.

140. Applying the effect of the cases guiding the interpretation of the meaning of exceptional circumstances, as cited at paragraphs [12] to [25] above, that was a circumstance that was so out of the ordinary that it comprised exceptional circumstances.

141. I therefore find the costs submissions identifying exceptional circumstances as made on the appellant’s behalf, and as cited at paragraph [81] above, to be compelling, and should be accepted.

142. For the foregoing reasons, I find, pursuant and within the meaning of s 88 of the Act, the appellant has made out her claim for her costs of the appeal to be paid by FaCS as a consequence of exceptional circumstances surrounding the appeal having been amply demonstrated.

Specific gross sum order for costs

143. At this point it is appropriate to set out some relevant guiding principles gathered and extracted from decided cases concerning orders for specific amounts for costs.

144. A helpful summary appears in the annotations to UCPR Pt 42.90 in Costs in the NSW Civil Procedure Handbook 2015, Thomson Reuters, Ed by Hamilton, Lindsay et al, which I draw upon as follows.

145. The purpose of a lump costs order is to avoid the expense, delay and aggravation involved in protracted costs proceedings where the amount claimed can be seen to be logical, fair and reasonable: Sheborne Estate (No 2); Vanvalen v Neaves [2005] NSWSC 1003; (2005) 65 NSWLR 268, at [38]. I find that the appellant’s application for a specific gross sum costs order in this case fits all of those criteria.

146. The making of an order for costs is a matter calling for the exercise of a discretion based on sound reasons: Oshlack v Richmond River Council [1998] HCA 1; 193 CLR 72.

147. In this case, the fact that the appellant has exhausted her financial resources is a relevant consideration. So too is the fact that the assessment of a specific gross sum involves relative simplicity in a relatively modest amount, so that there is significant utility in seeking to avoid potentially protracted costs disputation: Australian Competition and Consumer Commission v Dataline.Net.Au Pty Ltd (2006) 236 ALR 665, at [122]; Keen v Telstra Corp (No 2) [2006] FAC 930, at [5].

148. Added to those considerations, and of vital importance in this case, is the relative urgency of ensuring the remaining outstanding legal issues between the parties are promptly quelled so that the appellant can swiftly proceed to focus upon re-establishing her care of the child without the needless distraction of a prolonged dispute over costs.

149. In this case, I consider that the factual circumstances outlined at paragraphs [50] to [65] above, amply provide an adequate factual foundation for taking the approach of fixing a specific gross sum for costs in this case: Roberts v Rodier [2006] NSWSC 1084, at [40].

150. As to the amount of costs sought by the appellant, I propose to only modestly discount the sum of $23,860. This is because first, the initial component of $13,860 is the product of an already substantial discount of costs, and secondly, the total amount, including the $10,000 component is patently fair and reasonable. A costs assessment of either of those amounts would be unduly costly, needlessly burdensome, and would be productive of needless further delay and frustration to the parties.

151. Accordingly, applying the required broad-brush approach on account of those factors, and applying a modest discount as explained above, I assess the appellant’s costs of the appeal for payment by FaCS in the rounded down amount of $23,000.

Ex gratia payment recommendation

152. Before leaving the consideration of this case, and as identified during the course of argument, I consider it appropriate to make the following further remarks in circumstances where the cost order I make in this case is intended to provide the appellant with compensation for her costs of the appeal, although the identified deficiencies which have led to the appeal, have had a wider adverse impact on the appellant.

153. There have been cases where courts have recognised such matters and have recommended that an ex gratia payment be made in favour of a successful appellant in respect of otherwise unrecoverable costs. An example is in the case of abortive proceedings before a Magistrate, where an appeal seeking prerogative relief became necessary: Cummins v MacKenzie [1979] 2 NSWLR 803, at pp 811F – 812A.

154. In this case, if the Act had conferred a power along the lines of that set out in s 98(1) of the Civil Procedure Act 2005 to enable consideration of a third party costs order against the care agency, I would have invited submissions from potentially affected parties, including third parties, on that question.

155. In circumstances where that power does not exist, as observed at paragraph [70] above, but given the summary of the appellant’s situation as outlined at paragraphs [31] to [42] above, in the interests of justice, and adopting the formulation expressed by Sheppard J, in Cummins v MacKenzie, at pp 811F – 812A: “Perhaps it is not asking too much for there to be paid in this case ex gratia a payment…” which would cover at least some of the appellant’s costs of the application to the Children’s Court, and her related consequential expenses arising directly from what I have found to be the care agency’s deeply flawed investigation report.

156. I consider that approach to be apt in this case, on the evidence as analysed in the principal judgment, where the care agency in question, apparently a non-Government not for profit organisation, is paid from public funds to carry out important delegated child care work on behalf of FaCS.

157. In this case, the findings in the appeal indicate that the care agency so abjectly failed in its investigative duties in that regard, including by blatantly declining to follow the Ombudsman’s basic investigative recommendations. This was for the spuriously proffered reason of a perceived cost burden. As a result, an expensive injustice was wrought upon on the appellant.

158. Although those circumstances are also truly exceptional, they cannot be considered as part of the present application for costs, notwithstanding that the appellant has had to bear the financial consequences of such ineptitude.

Orders

159. I make the following orders:

1. Pursuant to s 88 of the Children and Young Persons (Care and Protection) Act 1998, the appellant’s costs of the appeal and the consequential application for costs, are assessed in the discounted amount of $23,000;

2. The assessed costs the subject of Order (1) above, are to be paid by the respondent within 14 days of today’s date;

3. Liberty to apply on 3 days’ notice if any further or other orders are required.

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Decision last updated: 29 March 2018