Reza and Sadir & Anor
[2019] FamCA 404
•21 June 2019
FAMILY COURT OF AUSTRALIA
| REZA & SADIR AND ANOR | [2019] FamCA 404 |
| FAMILY LAW – COSTS – Where application for costs by second respondent – Where second respondent joined in proceedings by the wife – Where primary relief sought by the wife was in equity pursuant to the Court’s accrued jurisdiction – Where ultimately wife wholly unsuccessful – Where appropriate that the provisions as to costs under the Civil Procedure Act 2005 (NSW) and the Uniform Civil Procedure Rules 2005 (NSW) be considered – Where appropriate that wife pay the second respondent’s costs on an indemnity basis as agreed or assessed FAMILY LAW – COSTS – Where second respondent joined in proceedings by the wife – Where wife sought orders as against second respondent under s 106B of the Family Law Act 1975 (Cth) – Where ultimately claim against second respondent withdrawn and dismissed – Consideration of applicable principles – Where wife to pay second respondent’s costs on a party/party basis as agreed or assessed. |
| Civil Procedure Act 2005 (NSW) s 98 Family Law Act 1975 (Cth) ss 106B, 117 Family Law Rules 2004 (Cth) r 19.08(3), 19.18(1) Uniform Civil Procedure Rules 2005 (NSW) rr 42.1, 42.2 |
| Beach Petroleum NL v Johnson (No 2) (1995) 135 ALR 160 Colgate-Palmolive Company and Colgate-Palmolive Pty Limited v Cussons Pty Limited [1993] FCA 536 Collins & Collins (1985) FLC 91-603 D & D (Costs) (No. 2) [2010] FamCAFC 64 Fennessy & Gregorian [2009] FamCAFC 44 Greedy & Greedy (1982) FLC 91-250 Harris & Dewell & Harris (Costs) [2018] FamCAFC 180 Hampton & Farley and Ors (No 3) [2013] FamCA 890 Hawkins & Roe [2012] FamCAFC 77 Idoport Pty Ltd v National Australia Bank Ltd [2007] NSWSC 23 Jones & Anor & Markham [2010] FamCA 1026 Joyce & Fante [2013] FamCAFC 141 Lenova & Lenova (Costs) [2011] FamCAFC 141 Limousin & Limousin [2007] FamCA 1178 Luadaka & Luadaka (1998) FLC 92-830 Parke & the Estate of the Late A Parke (2016) FLC 93-748 Penfold v Penfold (1980) 144 CLR 311 Skinner & Alfonso-Skinner (Costs) [2010] FamCA 1108 Yunghanns & Ors & Yunghanns & Ors & Yunghanns [2000] FamCA 681 |
| APPLICANT: | Mr Reza |
| FIRST RESPONDENT: | Ms Sadir |
| SECOND RESPONDENT: | Ms Idris |
| FILE NUMBER: | SYC | 6093 | of | 2014 |
| DATE DELIVERED: | 21 June 2019 |
| PLACE DELIVERED: | Parramatta |
| PLACE HEARD: | Parramatta |
| JUDGMENT OF: | Foster J |
| HEARING DATE: | By way of written submissions last received on 2 May 2019 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Mr Wong |
| SOLICITOR FOR THE APPLICANT: | Osborne Legal |
| COUNSEL FOR THE FIRST RESPONDENT: | Mr Hodgson |
| SOLICITOR FOR THE FIRST RESPONDENT: | Kelly Hardie Solicitors |
| COUNSEL FOR THE SECOND RESPONDENT: | Mr Sansom SC with him Mr Alexander |
| SOLICITOR FOR THE SECOND RESPONDENT: | Campbell Paton & Taylor |
Orders
That the wife pay the costs of the second respondent of and incidental to the wife’s equitable claim against the second respondent such costs to be assessed on an indemnity basis as agreed within one month from this date or otherwise as assessed.
That the wife pay the second respondent’s costs of and incidental to the section 106B proceedings and of the present costs application on a party/party basis as agreed within one month from this date or otherwise as assessed.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Reza & Sadir has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| FAMILY COURT OF AUSTRALIA AT PARRAMATTA |
FILE NUMBER: SYC 6093 of 2014
| Mr Reza |
Applicant
And
| Ms Sadir |
First Respondent
And
| Ms Idris |
Second Respondent
REASONS FOR JUDGMENT
The application for determination is an application for an order for costs contained in the Application in a Case filed 8 April 2019 by the second respondent in property proceedings as between the husband and wife.
On 10 March 2017 at a directions hearing before a registrar the wife through her then legal representative indicated that she would seek to join the second respondent in the proceedings insofar as they related to property adjustment between herself and the husband.
On 31 March 2017 the wife was ordered to file a further Amended Response joining the second respondent and setting out with particularity orders sought in equity as against the second respondent with such Response to be filed by no later than 7 April 2017.
Subsequently on 17 May 2017 the second respondent proffered various undertakings as to any disposition or dealing with any property that she owned and any such disposition or dealing through her company K Pty Ltd. On the same day, in the context of various other orders, trial directions were made to facilitate the matter proceeding to final hearing as to parenting.
The wife was required to file points of claim setting out the basis for the relief sought by her in equity as against the second respondent. The wife filed points of claim on 28 June 2017.
On 17 August 2017 trial directions were amended in that the parties were required to file trial affidavits by no later than 15 December 2017.
On 3 November 2017 the second respondent brought an application for summary dismissal of the wife’s claim against her as contained in the further Amended Response filed 18 April 2017. The wife’s points of claim was struck out as were various orders sought by her as against the second respondent and contained in the wife’s further Amended Response filed 18 April 2017. The wife was granted leave to file a further further Amended Response by 20 January 2018 setting out with particularity the relief sought as against the second respondent. The second respondent’s costs of and incidental to the proceedings were reserved.
The wife failed to file the Amended Response as ordered by the due date and on 23 January 2018 the wife was ordered to file the further further Amended Response by 12 March 2018. Again the second respondent’s costs were reserved.
On 19 March 2018, having filed her further further Amended Response the wife was ordered to file and serve points of claim setting out with particularity the orders sought as against the second respondent together with the primary facts relied upon in support of those orders by no later than 11 May 2018. On 19 March 2018 the wife, through her legal representative, informed the Court that she may further amend the relief sought by her against the second respondent by seeking to set aside various transactions as between the husband and the second respondent pursuant to section 106B of the Family Law Act 1975 (“the Act”).
On 21 May 2018 trial directions were made to facilitate issues as to property settlement being fixed for final hearing. On that day the court was informed by the wife’s legal representative that the wife proposed substantially to seek relief as against the second respondent pursuant to section 106B of the Act. Parties were required to file their affidavit evidence by no later than 10 August 2018. Subsequently, the time for filing affidavit evidence was extended to 28 September 2018.
Subsequently parenting and property proceedings were re-consolidated and on 30 August 2018 the parties were ordered to file one consolidated affidavit as to such issues by 30 September 2018.
The final hearing commenced on 25 February 2019 with seven days allocated for trial. On the first day of hearing various paragraphs of the wife’s further Further Amended Response seeking relief as against the second respondent were struck out. Subsequently and on 27 February 2019 the wife’s further Further Amended Response insofar as it relates to any relief sought as against the second respondent under section 106B of the Act was, by consent, withdrawn and dismissed. The effect of this order was to remove the second respondent as a party to the proceedings. Thereafter the second respondent simply remained as a witness to be relied upon by the husband.
On 27 February 2019 the second respondent was ordered to file any application for costs by way of Application in a Case, supporting affidavit and written submissions by 5 April 2019 with the respondent wife to file her Response, any affidavit and written submissions by 3 May 2019. Subsequently, by consent, time for the respondent wife to file her material was extended to 24 May 2019. Ultimately, written submissions were not filed by the wife until 28 May 2019. Judgment was reserved on 30 May 2019.
On 28 February 2019 the husband and wife settled proceedings as to parenting and property with final orders being made by consent that day.
In her application for costs the second respondent seeks orders, in summary, that provide:
(1)that the wife pay the second respondent’s costs with respect to the wife’s equity suit against the second respondent for the period from 21 February 2017 to 3 November 2017 on an indemnity basis and to be assessed in the sum of $60,000.00;
(2)that the wife pay the second respondent’s costs with respect to the wife’s section 106B claim as against the second respondent for the period from 3 November 2017 to 27 February 2019 on an indemnity basis and to be assessed in the sum of $192,500.00; and
(3)that the wife pay the second respondent’s costs with respect to the present application on the ordinary basis assessed in the sum of $5,150.00.
The second respondent relies on her application for costs, her solicitor’s affidavit and written submissions. The wife relies on her written submissions filed 28 May 2019.
Costs: Family Law Act 1975
Section 117 of the the Act provides that each party to the proceedings shall bear his or her own costs.
That principle is, however, subject to the discretion afforded to the trial judge in subparagraph (2), which provides that if the Court is of the opinion that there are circumstances that justify it in doing so, the Court may, subject to further subsections thereof and the applicable Rules of the Court, make such order as to costs as the Court considers just.
Although s 117(2) requires a finding of justifiable circumstances as an essential preliminary to making an order for costs, there is no additional or special onus on an applicant who seeks an order for costs: Penfold v Penfold (1980) 144 CLR 311.
The matters relevant to determining what order, if any, should be made for costs are set out in subsection (2A) of that section. They are as follows:
(a)the financial circumstances of each of the parties to the proceedings;
(b)whether any party has legal aid and the terms of any grant of aid;
(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 answers, questions, admissions of facts, production of documents and 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;
(e)whether any party to the proceedings has been wholly unsuccessful in the proceedings;
(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; and
(g)such other matters as the Court considers relevant.
In Collins & Collins (1985) FLC 91-603 (at 79,877), the Full Court described the discretion conferred by s 117 as being a “broad” one and held that the factors set out in s 117(2A) are not to be read in a restrictive way.
The Full Court in Hawkins & Roe [2012] FamCAFC 77 said:
17.With respect to the application of the section, in Penfold v Penfold (1980) 144 CLR 311, the High Court said at 315 and 316:
1.Sub-section (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order. Beyond this there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs. Consequently, with respect to their Honours in the Family Court, we do not agree with the suggestion made in the judgment under appeal that an order can only be made under s. 117 (2) in "a clear case".
2.Sub-section (2) does not in our view as a matter of law require the judge to specify the circumstances which justify the making of an order. It does not expressly say so, and in the context of the making of an order for costs there is no sufficient basis for making an implication. Judges very frequently make orders for costs without giving reasons or making findings, even when costs are in issue. The absence of reasons or findings does not in itself indicate that a judge has erroneously exercised his discretion to award costs, though it will place an appellate court in the position of examining the circumstances and of determining for itself whether the circumstances show that the discretion was erroneously exercised (Kent v Kent). Accordingly, in the absence of some positive legislative indication we should not attribute to Parliament the requirement that a judge must make particular findings in relation to an order for costs.
(footnotes omitted)
18.The weight to be given to a particular consideration under s 117(2A) is a matter for the discretion of the judge. However, in I and I (No 2) (1995) FLC 92-625 the Full Court of this Court held that the relevant matters in s 117(2A) “must all be taken into account and all balanced in order to determine whether the overall circumstances justify the making of an order for costs”. That is not to say that one single matter may not ultimately be determinative. The Full Court confirmed this in Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Another (2005) 33 Fam LR 123 at paragraph 41:
… A number of factors are then listed in the subparagraphs. The financial circumstances of each of the parties to the proceedings is the first mentioned factor. Nowhere in subs (2A) or elsewhere in s 117, is there any prescription that more than one factor must be present before an order for costs is made nor of comparative weight of the factors set out in subs (2A). As a consequence, there is nothing to prevent any factor being the sole foundation for an order for costs.
In Greedy & Greedy (1982) FLC 91-250 and Luadaka & Luadaka (1998) FLC 92-830, the Full Court made clear that it is unnecessary to spell out detailed reasons for decisions in costs matters.
The provision relating to the calculation of costs is set out in r 19.18(1) of the Family Law Rules 2004 (Cth) (“the Rules”) which states:
Method of calculation of costs
(1)The court may order that a party is entitled to costs:
(a)of a specific amount;
(b)as assessed on a particular basis (e.g. lawyer and client, party/party or indemnity);
(c)to be calculated in accordance with the method stated in the order; or
(d)for part of the case, or part of an amount, assessed in accordance with Schedule 3.
It was said in Beach Petroleum NL v Johnson (No 2) (1995) 135 ALR 160 at 162 that the purpose of the rule enabling an order for costs in a specific amount, without formal assessment or taxation is, commonly with other courts, to “avoid the expense, delay and aggravation involved in protracted litigation arising out of taxation”.
In Idoport Pty Ltd v National Australia Bank Ltd [2007] NSWSC 23 the Court said at [10] that the Court must act judicially, but that does not mean that it must exercise the power to award a lump sum in any “scientific or formulaic manner”.
Murphy J observed in Parke & the Estate of the Late A Parke (2016) FLC 93-748 at [130]:
If the court is to fix a sum it should be “fixed broadly having regard to the information before the Court”… The process does not “by its very nature … envisage that a process similar to that involved in a traditional taxation or assessment of costs should take place”…
The category of cases in which an award of an indemnity costs order may be appropriate are not closed and the Full Court of the Family Court observed in Yunghanns & Ors & Yunghanns & Ors & Yunghanns [2000] FamCA 681 at [31]:
24.… It will suffice to say that the categories of circumstances which enliven the discretion to award indemnity costs are not closed, and that it is not a condition precedent to the exercise of the discretion that some collateral purpose or species of fraud be established against the party against whom such order is sought. …
More recently, the Full Court has considered indemnity costs in Joyce & Fante [2013] FamCAFC 141, Limousin & Limousin [2007] FamCA 1178, Fennessy & Gregorian [2009] FamCAFC 44 and D & D (Costs) (No. 2) [2010] FamCAFC 64.
Otherwise, the principles underlying an award for indemnity costs have been classically summarised by Sheppard J in Colgate-Palmolive Company and Colgate-Palmolive Pty Limited v Cussons Pty Limited [1993] FCA 536 where his Honour, in summary, said at [24]:
1. 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 a party and party basis. …
2. 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. …
3. In consequence of the settled practice which exists, the Court ought not usually make an order for 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. …
Sheppard J set out some of the circumstances which may warrant the exercise of the discretion to award indemnity costs and they included:
a)false and irrelevant allegations of fraud;
b)misconduct that causes a loss of time to the Court and other parties;
c)where the proceedings were commenced or continued for an ulterior motive;
d)the undue prolongation of a case on groundless contentions; and
e)wilful disregard of known facts and clearly established law.
In Harris & Dewell & Harris (Costs) [2018] FamCAFC 180 (20 September 2018) the Full Court said (footnotes omitted):
23.In Kohan and Kohan, the Full Court held, in applying the principles expounded by Sheppard J in Colgate-Palmolive, that an order for indemnity costs represents a “very great departure from the normal standard”. In the later decision of the Full Court in Prantage & Prantage, Thackray and Ryan JJ referred to Kohan and other authorities in the Full Courts of both this Court and the Federal Court of Australia as well as the state appeal courts. Their Honours concluded (at [86]) that the “usual rule” continued to apply in respect of awards of costs in this Court notwithstanding the Full Court accepting that the difference between party/party costs and a party’s actual costs has continued to grow significantly.
24.That proposition also derives support from what Callinan J said in Arundel Chiropractic Centre Pty Ltd v Deputy Commissioner of Taxation. His Honour said that an order for indemnity costs should “be exceedingly rare, as they have a tendency to encourage extravagance and put the quantum of legal fees beyond the effective scrutiny of the courts and their taxing officers”.
25.The rarity of an order for indemnity costs can also be seen illustrated by the comments of Lindgren J in NMFM Property Pty Ltd v Citibank Ltd (No 2), referred to by their Honours in Prantage (at [102] – [103]). Lindgren J said that there is no rule that indemnity costs will be ordered “where the losing party was guilty of ethical or moral delinquency in the antecedent facts which have given rise to the litigation.”
26.Of course, in proceedings under the Act, an overriding “usual rule” is prescribed by s 117(1), namely that each party bears their own costs. The degree of departure between that “usual rule” and a result where one party bears the totality of the other party’s costs can be seen to be all the greater.
The Equity Suit
The wife’s relief in equity sought as against the second respondent was not relief under the Family Law Act 1975 (Cth) but relief sought by reason of this court’s accrued jurisdiction. As such a consideration of costs of the equity proceedings as against the second respondent until 3 November 2017 are not constrained by reference to s 117 of the Act.
In Jones & Anor & Markham [2010] FamCA 1026, Austin J determined an application for costs following substantive property proceedings in which a party (the respondent in the costs proceedings) had unsuccessfully brought a suit in equity against two other parties (the applicants in the costs proceedings) which was heard in the court’s accrued jurisdiction. In declining to hear the costs application under s 117 of the Act, Austin J stated as follows at [15]:
It is trite to observe that costs in the Family Court are regulated by the provisions of s117 of the Act. That legislative provision ensures that ordinarily each party bears his or her own costs of the proceedings. However, it must be observed that that rule applies to proceedings under the Act. The proceedings between the applicants and the respondent in respect of the equity suit were not proceedings under the Act.
The applicants had been wholly successful with respect of the equity suit. Austin J said at [17]:
I have regard for the fact that ordinarily costs follow the event in relation to claims brought at common law and in equity. I am satisfied that it is appropriate that the respondent pay the costs of the applicants, at least in respect of the equity suit which he unsuccessfully prosecuted against them.
In Skinner & Alfonso-Skinner (Costs) [2010] FamCA 1108, Murphy J came to the same conclusion and made an order for costs using the provision of s 98 of Civil Procedure Act 2005 (NSW) and the Uniform Civil Procedure Rules 2005 (NSW).
In Hampton & Farley and Ors (No 3) [2013] FamCA 890 Le Poer Trench J considered the thus relevant provisions of the Civil Procedure Act 2005 (NSW) (“CPA”) and the Uniform Civil Procedure Rules 2005 (NSW) (“UCPR”) at [126] - [128]:
Costs proceedings under the CPA and the UCPR
126.The power of a court to make an order for costs under the CPA is set out in s 98 of that Act as follows:
98 Courts powers as to costs ...
(1) Subject to rules of court and to this or any other Act:
(a)costs are in the discretion of the court, and
(b)the court has full power to determine by whom, to whom and to what extent costs are to be paid, and
(c)the court may order that costs are to be awarded on the ordinary basis or on an indemnity basis...
127.Section 98 operates subject to the UCPR, specifically Pt 42 thereof. The relevant rules in Pt 42 are as follows:
42.1 General rule that costs follow the event...
Subject to this Part, if the court makes any order as to costs, the court is to order that the costs follow the event unless it appears to the court that some other order should be made as to the whole or any part of the costs.
42.2 General rule as to assessment of costs...
Unless the court orders otherwise or these rules otherwise provide, costs payable to a person under an order of the court or these rules are to be assessed on the ordinary basis…
128.Some of the general principles which apply to the s 98 CPA and part 42 of the UCPR can be summarised as follows:
a)The principle that costs follow the event is intended to be compensatory not punitive: see Telfer (as Executor for the Estate of the Late Telfer) v Telfer (No 2) [2013] NSWSC 823 at [16]; Footes v Southern Cross Mine Management Pty Ltd [2007] HCA 56; (2007) 234 CLR 52.
b) To displace the prima facie principle that costs follow the event, a party will need to show that something out of the ordinary has occurred to justify a departure from it: see Martin v the State of New South Wales (No 6) [2012] NSWLEC 227 at [7].
c) The phrase “follow the event” does not necessarily refer to the proceedings as a whole and costs can be awarded based on an evaluation of distinct issues in the proceedings: see discussion in Bonic v Pacific General Securities Ltd [2009] NSWSC 1221 (“Bonic v Pacific”) at [8]–[12].
d) The court in its discretion may refuse to make a costs order in favour of a successful party and it may order costs against a successful party where this is appropriate: see discussion of examples in Bonic v Pacific at [14].
Ultimately, the wife abandoned her application for equitable relief as sought against the second respondent. It is contended properly by the second respondent that the equitable claim was misconceived and demonstrated a wilful disregard of known facts and clearly established law.
The position of a third party to the marriage enmeshed in family litigation between husband and wife by being joined as a party involves that third party in expenditure as to costs to respond to relief sought or seek relief against a party to the marriage as the case may be.
In the circumstance where a third party is inappropriately joined as a party, such as in this matter, and an order for costs is made on the ordinary basis (party/party), it is trite to say that such an order will most likely leave that third party significantly out of pocket. It is appropriate to have regard to the compensatory role of a cost order as discussed above.
Relevantly, the second respondent by letter dated 24 May 2017 offered to allow the wife to abandon her relief sought on the basis that there be no order as to costs sought by the second respondent.
It is appropriate that the wife pay the second respondent’s costs of and incidental to the equity relief sought on an indemnity basis. Such order will be made accordingly.
The second respondent’s claim is for the sum of $60,000.00. Yet this matter involved significant interlocutory issues under the provisions of the Act and Rules, including the determination of objections as to the production of documents on subpoena where the determination of objections give rise to distinct costs remedies under the Act. Such interlocutory issues cannot be the subject of the proposed costs order but give rise to a remedy of costs under the Act consequent on orders being made provided, of course, that the application was made within time. In these circumstances it is inappropriate to endeavour to assess a fixed sum.
The section 106B Relief
The wife later abandoned her relief under s 106B sought against the second respondent.
Again the position of the second respondent is as a stranger to the primary litigation. She was drawn into prospectively a seven day trial only to find that the relief sought against her was abandoned during the trial.
It is not contended that the financial circumstances of the wife are such that they preclude an order for costs. She is in employment and will retain not insignificant assets by reason of property settlement orders. However, financial circumstances are not of themselves decisive, as otherwise an impecunious party could litigate with impunity: Lenova & Lenova (Costs) [2011] FamCAFC 141).
Neither party is in receipt of a grant of legal aid.
The wife failed at various times to comply with court orders as to filing and service of amended documents properly setting out the relief sought by her under s 106B.
The wife has been wholly unsuccessful in her putative claim against the second respondent under s 106B. Indeed, her claim was withdrawn and dismissed by consent after engaging the second respondent in the preparation for what was set down as a seven day trial.
As noted above an order for costs on a party/party basis will leave the second respondent out of pocket as to her costs.
A consideration of these relevant factors under section 117(2A) of the Act leads to the conclusion that there are circumstances justifying a departure from the general rule.
The second respondent has provided to the Court an assessment of the quantum of costs on an indemnity basis in the sum referred to above.
The provisions of rule 19.08(3) are relevant:
Order for costs
(1)A party may apply for an order that another person pay costs.
(2)An application for costs may be made:
(a)at any stage during a case; or
(b)by filing an Application in a Case within 28 days after the final order is made.
(3)A party applying for an order for costs on an indemnity basis must inform the court if the party is bound by a costs agreement in relation to those costs and, if so, the terms of the costs agreement. (emphasis added)
The obligation imposed by the rule is to “inform” the Court if a party is bound by a costs agreement and, if so, to “inform” the Court of “the terms of the costs agreement”. There is no obligation cast by the rule to put into evidence a copy of the relevant costs agreement, although in practice that is very frequently the means by which the Court is informed of its relevant terms. A copy of the Legal Services Agreement between the second respondent and her solicitors is exhibited document “SPF 2” to her solicitor’s affidavit.
Again the special position of the second respondent in the proceedings is relevant. She was an involuntary party drawn into the proceedings by the wife. The wife’s claim under s 106B was ultimately abandoned.
The comments by the Full Court in Harris & Dewell & Harris (Costs) [2018] FamCAFC 180 (20 September 2018) remain apposite. In the family law context (where there is not a costs follows the event regime) and where the general rule that each party pays their own costs is only to be departed from in appropriate circumstances the Court must be more circumspect in making an order for indemnity costs where such an order represents a “very great departure from the normal standard”.
There are clearly circumstances justifying a departure from the general rule and there will be an order that the wife pay the second respondent’s costs of and incidental to the s 106B proceedings and of the present application for costs on a party/party basis.
Orders will be made accordingly.
I certify that the preceding fifty eight (58) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 21 June 2019.
Associate:
Date: 21 June 2019
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