Romano and Lindfield (No. 2)
[2021] FamCA 580
•6 August 2021
FAMILY COURT OF AUSTRALIA
Romano & Lindfield (No. 2) [2021] FamCA 580
File number(s): SYC 5523 of 2010 Judgment of: HARPER J Date of judgment: 6 August 2021 Catchwords:
FAMILY LAW – COSTS – Parenting proceedings – Father wholly unsuccessful – Final orders made in line with interim orders from 2016 and offer of settlement made by the mother – Where father filed no material in relation to costs – Where unchallenged evidence of mother deposed to assets of father – Where justification for costs award established at level higher than party-party costs – Where father ordered to pay mother’s costs fixed in the sum of $50,000. Legislation: Family Law Act 1975 (Cth) s 117
Family Law Rules (2004) (Cth) r 19.18
Cases cited: Atkins & Hunt [2017] FamCAFC 131
Greedy & Greedy (1982) FLC 91
Harris & Dewell (No. 2) [2018] FamCAFC 180
Luadaka and Luadaka (1998) FLC 92
Oshlackv Richmond River Council (1998) 193 CLR 72
Parke & Estate of the Late A Parke (2016) FLC 93-748
Penfold v Penfold (1980) 144 CLR 311
Prantage & Prantage (2013) 49 Fam LR 197
Number of paragraphs: 30 Date of last submission/s: 3 June 2021 Date of hearing: Heard on the papers Place: Sydney Solicitor for the Applicant: Rowlandson & Co Solicitors Solicitor for the Respondent: No Appearance ORDERS
SYC 5523 of 2010 BETWEEN: MS ROMANO
Applicant
AND: MR LINDFIELD
Respondent
AND INDEPENDENT CHILDREN'S LAWYER
ORDER MADE BY:
HARPER J
DATE OF ORDER:
6 AUGUST 2021
THE COURT ORDERS THAT:
1.The Respondent Father is to pay costs fixed in the amount of $50,000.
Note: The form of the order is subject to the entry in the Court’s records.
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 17.02 Family Law Rules 2004 (Cth).
IT IS NOTED that publication of this judgment by this Court under the pseudonym Lindfield & Romano has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
REASONS FOR JUDGMENT
Amended pursuant to r 10.14(b) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth) on 8 November 2021
HARPER J
These are parenting proceedings between the Applicant in the substantive proceedings, Mr Lindfield ("the father") and the Respondent in the substantive proceedings, Ms Romano ("the mother").
I delivered judgment on 25 March 2021.
By way of an Application in a Case filed on 22 April 2021 the mother makes an application for costs. The orders sought by the mother are as follows:
1.That the respondent (the applicant in the substantive proceedings in this matter) pay the applicant’s (the respondent in the substantive proceedings in this matter) costs of and incidental to these proceedings:
1.1on an indemnity basis, or in the alternative
1.2on a solicitor/client basis and as assessed, or in the alternative
1.3pursuant to Schedule 3 of the Family Law Rules, 2004.
2.That the respondent pay the applicant’s costs of and incidental to this Application in a Case.
On 22 April 2021 I made directions for the filing of submissions and affidavit material in support as follows:
1.The Respondent Father file and serve by no later than close of registry filing on 20 May 2021 any Response to the Application in a Case filed by the Applicant Mother on 22 April 2021, including any affidavit material he seeks to rely upon.
2.The Applicant Mother file and serve written submissions in support of her Application in a Case filed 22 April 2021 by no later than close of registry filing on 3 June 2021.
3.The Respondent Father file and serve any written submissions in response by no later than close of registry filing on 17 June 2021.
4.Upon receipt of the last set of submissions, and in the event neither party makes formal request for the matter to be listed for oral submissions, judgment stand reserved and the application be determined in chambers upon the papers.
The mother filed submissions and an affidavit in support. The father filed no material.
THE LAW
The relevant principles with respect to costs are well settled, and are set out in detail in the Full Court decision of Parke & Estate of the Late A Parke (2016) FLC 93-748; (2016) 314 FLR 322; [2016] FamCAFC 248 and Atkins & Hunt [2017] FamCAFC 131.
In proceedings to which the Family Law Act 1975 (Cth) (“the Act”) applies, the starting point is that each party shall bear his or her own costs. If, however, the Court is of the opinion that there are justifying circumstances, the Court may make such order as to costs or security for costs as the Court considers just.
It is not necessary to establish extraordinary or exceptional circumstances, however there must be circumstances which, at the absolute discretion of the Court, justify a costs order. As the High Court made clear in Penfold v Penfold (1980) 144 CLR 311; (1980) 28 ALR 213; (1980) FLC 90-800; (1980) 5 Fam LR 579; [1980] HCA 4, s 117(2) requires a finding of justifying circumstances before any costs order can be made.
In determining whether a costs order should be made and in what form, the Court has regard to the considerations set forth in s 117(2A), namely, the Court shall have regard to:
(a) the financial circumstances of each of the parties to the proceedings;
(b)whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
(c)the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters;
(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.
It is well-settled that no one factor has priority under s 117(2A), nor must more than one factor to be satisfied; any one factor may be sufficient. There may be a dominant or outstanding feature that makes an order for costs appropriate; thus although any one factor may be sufficient, no one factor is essential.
It is unnecessary to spell out detailed reasons for decisions on costs; Greedy & Greedy (1982) FLC 91 at p. 250; Luadaka and Luadaka (1998) FLC 92 at p. 830.
FINANCIAL CIRCUMSTANCES
The only evidence before the Court about the parties’ financial circumstances is provided by the mother. I accept this evidence. She deposes that her financial circumstances are modest. She earns approximately $600 per week. Her only major asset is a home with equity of approximately $380,000. She had to borrow from her grandmother and husband to pay her legal fees. Apart from child support periodic payments from the father of $179 per week, she is solely responsible for the financial support of the children.
The mother gave evidence, which I accept in the absence of any challenge by, or different evidence from, the father, that he is the sole registered owner of R Street, Suburb S with an estimate value of $1,700,000 and an established business namely B Company which is conducted from business premises owned by the paternal grandmother.
WHOLLY UNSUCCESFUL
The father commenced these parenting proceedings on 6 June 2016, seeking orders that previous final parenting orders dated 22 March 2012 ("the 2012 orders") be discharged. He sought both interim and final parenting orders.
The father's interim parenting application was determined on 20 December 2016. The 2012 orders were discharged and interim orders made which in summary provided that the mother have sole parental responsibility of the children, the children live with the mother and that the father be restrained from approaching the children. The mother submitted that these interim orders were substantially similar to the interim orders she sought in her Response filed 19 July 2016.
The interim orders remained in place until judgment was handed down by Justice Harper on 25 March, 2021.
On 27 February, 2020 the matter was listed for mention before me and the Family Report of Ms E ("the report") was released with recommendations that the mother have sole parental responsibility of the children, they children live with her and spend no time with the father. The family report writer also recommended the father be restrained from approaching the mother and or the children. The report writer also recorded that the father had acted in a manner towards her which she found intimidating and lead to the early termination of her interview with him.
I accept the mother's submissions that the final orders sought by the mother at the final hearing were consistent with her response filed on 19 July 2016, the interim orders and the recommendations of Ms E.
The Court's final orders were relevantly as follows:
1) That all previous parenting orders be discharged.
2)That the mother have sole parental responsibility for the children X (born in 2003) and Y (born in 2009).
3)That the children live with their mother.
4)That the father is restrained from coming into direct contact with the mother or the children, either in person or by any means of communication.
5)That the father is restrained from coming within 300 meters of the residence of the mother, her place of employment or any educational facility or place of employment of the children.
I am satisfied that the father was wholly unsuccessful at the final hearing.
OFFERS OF SETTLEMENT
According to her evidence the mother made several offers of settlement to the father. Prior to the determination of the first interim application the mother made an offer of compromise in respect of costs to the father that within 28 days he pay the sum of $5,500. There was no response.
On 24 and 25 August, 2020 the mother made offers to resolve the parenting proceedings which were rejected by the father by email dated 29 August, 2020 ( Annexures "F", "G" and "H" of the mother's affidavit) The mother submitted her offers were "in line with" the final orders made on 25 March 2021. I agree. The correspondence made clear to the father that if he rejected the offer it would be relied upon on the question of costs.
OTHER RELEVANT MATTERS
The mother submitted that the father's approach to the proceedings in pressing for parenting orders when he had not seen the children for five years and in the face of the recommendations of Ms E exposed the mother to unnecessary expense and aggravation when he should have known the Court was highly unlikely to make the parenting orders which he sought. There is force in this submission.
I am satisfied there a circumstances justifying departing from the starting position set forth in s 117(1) of the Act.
The mother also submits the father should be ordered to pay her costs on an indemnity basis.
The award of indemnity costs in this Court has regularly been called a significant departure from the normal standard. In Harris & Dewell (No. 2) [2018] FamCAFC 180 the Full Court said at [23] - [25]:
[23] In Kohan and Kohan [(1993) FLC 92-340 (“Kohan”)], the Full Court held, in applying the principles expounded by Sheppard J in Colgate-Palmolive [Company v Cussons Pty Limited (1993) 46 FCR 225], 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 (2013) 49 Fam LR 197 (“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 ([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 [[2001] HCA 26; (2001) 179 ALR 406 at [40]]. 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.
In Prantage & Prantage (2013) 49 Fam LR 197 (“Prantage”) at [152] Murphy J pointed out that reference to "a great departure" is not a fetter on this Court's discretion to award costs or indemnity costs if justice so requires it, citing Oshlackv Richmond River Council (1998) 193 CLR 72 at [134]: "[r]ather it recognises that an order for indemnity costs, has a particular context in this jurisdiction".
The mother submitted that an indemnity costs order ought to be made in her favour for the following reasons:
a)she was wholly successful in the final parenting orders that she sought;
b)the father was wholly unsuccessful in relation to the parenting orders that he sought;
c)these proceedings have been ongoing for the better part of just under 5 years;
d)the conduct in the father in seeking orders that certainly after the interim orders were made on 20 December, 2016 he had no prospect of succeeding;
e)the father's conduct, especially his conduct in the family report interview process;
f)the fact that the Court made positive findings of fact that he engaged in family violence.
While the mother's financial circumstances and the father's lack of success and rejection of a reasonable offer of settlement justify a costs order in the mother's favour, I am not satisfied the circumstances warrants the departure which indemnity costs would entail, except for the period after 24 August 2020. However, an award of costs on a higher basis than party/party costs is warranted.
The mother calculates her costs on an indemnity basis to be $54,392. I accept these costs are modest in the circumstances of this case. I am satisfied that the mother should receive an award of costs. I will exercise my discretion to order a fixed amount under Family Law Rules (2004) (Cth) rule 19.18(1)(a) rather than put the parties to any further expense by the need for an assessment process. I take account of the mother's costs in bringing this costs application. I will order the father to pay costs fixed in the amount of $50,000.
I certify that the preceding thirty (30) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Harper. Associate:
Dated: 6 August 2021
0
7
2