Scarlett and Bradshaw
[2020] FamCAFC 19
•3 February 2020
FAMILY COURT OF AUSTRALIA
| SCARLETT & BRADSHAW | [2020] FamCAFC 19 |
| FAMILY LAW – APPEAL – COSTS – Written submissions on the issue of costs – Where the appellant is in a stronger financial position than the respondent – Where the appeal was wholly unsuccessful – Where written offers of settlement carry little weight – No basis for a costs order other than on the usual basis – Where the parties proceeded as if a taxation of costs was being undertaken – Where the respondent’s costs will have to be assessed – Appellant to pay the respondent’s costs of the appeal as agreed, or in default of agreement, as assessed – Each party to bear their own costs of the application for costs. |
| Family Law Act 1975 (Cth) s 117 |
| D & D (Costs) (No.2) (2010) FLC 93-435; [2010] FamCAFC 64 Kohan and Kohan (1993) FLC 92-340; [1992] FamCA 116 Limousin v Limousin (Costs) (2007) 38 Fam LR 478; [2007] FamCA 1178 |
| APPELLANT: | Ms Scarlett |
| RESPONDENT: | Mr Bradshaw |
| FILE NUMBER: | SYC | 4319 | of | 2014 |
| APPEAL NUMBER: | EA | 165 | of | 2018 |
| DATE DELIVERED: | 3 February 2020 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | In Chambers |
| JUDGMENT OF: | Aldridge, Austin & Tree JJ |
| HEARING DATE: | Heard by way of written submissions |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 22 November 2018 |
| LOWER COURT MNC: | [2018] FamCA 982 |
REPRESENTATION
| COUNSEL FOR THE APPELLANT: | Ms Christie SC |
| SOLICITOR FOR THE APPELLANT: | Barkus Doolan |
| COUNSEL FOR THE RESPONDENT: | Mr Coleman SC |
| SOLICITOR FOR THE RESPONDENT: | Manning Lawyers |
Orders
The appellant pay the respondent’s costs of and incidental to the appeal as agreed, or in default of agreement, as assessed.
The appellant and the respondent bear their own costs of the application for costs.
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 Scarlett & Bradshaw 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).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY |
Appeal Number: EA 165 of 2018
File Number: SYC 4319 of 2014
| Ms Scarlett |
Appellant
And
| Mr Bradshaw |
Respondent
REASONS FOR JUDGMENT
Introduction
On 24 October 2019, the Full Court of the Family Court of Australia dismissed an appeal against final parenting orders made by a judge of the Family Court of Australia on 22 November 2018. Orders were made for the issue of costs to proceed by way of written submissions.
Mr Bradshaw (“the respondent”) seeks an order that his costs be paid by Ms Scarlett (“the appellant”) on an indemnity basis, or two thirds of an indemnity basis, or at scale.
Pursuant to s 117(1) and s 117(2) of the Family Law Act 1975 (Cth) (“the Act”), each party to proceedings under the Act is to bear his or her own costs of the proceedings, unless the Court is satisfied that the circumstances justify some other order. In determining whether such an order is just, the Court must have regard to the matters set out in s 117(2A) of the Act.
Should there be an order for costs?
The first step is to determine whether there should be a costs order at all. The parties raised the following considerations under s 117(2A) of the Act.
The first is the parties’ respective financial positions (s 117(2A)(a) of the Act).
The respondent’s Financial Statement filed on 20 February 2017 shows that his annual income was $135,148 per year, although we are informed by senior counsel for the respondent that his annual income is now approximately $150,000.
According to the appellant’s Financial Statement filed on 20 February 2017, her income was $398,580 per year. The appellant did not adduce any evidence as to her current financial position.
The available evidence indicates that the appellant is in a stronger financial position than the respondent.
The appeal was wholly unsuccessful (s 117(2A)(e) of the Act).
The appellant relies upon what she submits was the poor “conduct of the proceedings” by the respondent (s 117(2A)(c) of the Act).
The trial judge’s orders delayed the planned increase in the respondent’s time with the parties’ child until the respondent completed an anger management course. Ultimately, the respondent did so, but only three weeks prior to the hearing of the appeal.
This, however, is not an aspect of the conduct of the proceedings, which in this case, is the appeal. Rather, the conduct complained of is not in relation to any proceedings at all but is concerned with the respondent’s approach to the trial judge’s orders and to the child.
This behaviour could be taken into account under s 117(2A)(g) of the Act but it is a matter to which we afford little weight. The completion of an anger management course at an earlier time would not have seen the appeal fall away.
Finally, both parties relied on written offers of settlement of the proceedings (s 117(2A)(f) of the Act).
On 15 May 2019, that is seven days before the hearing of the appeal which was on 22 May 2019, the respondent’s solicitors forwarded a written offer of settlement to the appellant’s solicitors dealing with three matters: the parenting orders, the property orders (which were not the subject of an appeal but had been made at the same time as the parenting orders) and the costs of the appeal.
The respondent’s proposed parenting orders had the effect of delaying the respondent’s graduated time with the child and were designed, in part, to meet the appellant’s contention that the orders made by the trial judge provided for the child spending too much time with the respondent too quickly. As the appeal was dismissed, the appellant’s position would have been significantly improved had she accepted the respondent’s offer.
The respondent’s draft orders also proposed that there be an order that “the [a]ppellant pays the [r]espondent’s costs of the proceedings on the ordinary basis, agreed in the sum of $50,000, including GST” (emphasis omitted). The letter noted that the likely costs of the appeal, assessed on an indemnity basis, would be approximately $80,000 and foreshadowed seeking an order to that effect.
Finally, the respondent’s offer was said to be open until 5.00 pm on 17 May 2019.
The appellant’s solicitors responded on 17 May 2019 with an amended offer, which varied the proposed orders for graduated time significantly and suggested the deletion of a number of parenting orders made by the trial judge which were not the subject of the appeal. The proposals as to costs were deleted.
However, the appellant accepted the property orders proposed by the respondent. In those circumstances, we do not attach any weight to the appellant’s submissions that the proposed offers should be disregarded because they dealt with matters which were not the subject of the appeal.
There is, however, considerable force in the appellant’s submission that the respondent’s offer came so late as to deprive it of any significant weight because the reality was that almost all the costs of the appeal, including counsels’ fees, had already been incurred.
The considerations, therefore, that are significant are the failure of the appeal (s 117(2A)(e) of the Act) and the parties’ respective financial positions (s 117(2A)(a) of the Act). Taking them into account, the appropriate order is that the appellant pay the respondent’s costs of the appeal.
Should those costs be assessed on an indemnity or some other basis?
It is well established that indemnity costs will only be awarded in exceptional circumstances (Kohan and Kohan (1993) FLC 92-340; Limousin v Limousin(Costs) (2007) 38 Fam LR 478; D & D(Costs) (No.2) (2010) FLC 93-435).
Whilst we accept the submission made on behalf of the respondent that the prospects of the appeal were not high, that is not, in all the circumstances, and of itself, a basis for an award of indemnity costs.
We have already indicated that the written offers of settlement made by the parties carry little weight.
No basis has been established for a costs order to be assessed other than on the usual basis, which is at scale.
The respondent’s costs are claimed in the sum of $45,640.67 when assessed at scale. That includes the costs of this application for costs. The costs of senior counsel for the appeal appear to be $18,427.97.
The appellant has prepared a schedule of the respondent’s costs objecting to many items which she asserts should be disallowed. In each case, an explanation for the objection is given. Generally, it is asserted by the appellant, either that the claim related to tasks which were said not to have been reasonably required, or there was insufficient detail within the claim to substantiate the work completed, or there was duplication of costs.
The respondent fell for the bait and responded in kind providing a schedule in like form answering each of the criticisms. In other words, the parties proceeded as if a taxation of costs was being undertaken.
Whilst this Court has for a number of years fixed the costs in appeals where it considers it can properly do so, it does not and will not act as a taxing officer. Either the Court will fix the costs in a broad brush way, or alternatively, it will make orders for them to be assessed. In this matter, the difference between the scale figures calculated in the two schedules is in the order of $20,000, with the dispute spread over many items. The respondent’s costs will have to be assessed.
As we have said, the respondent’s claim for costs includes the costs of this application for costs itself. Given that both parties had some success on the application for costs, it is appropriate that there be no order as to the costs of it.
I certify that the preceding thirty-one (31) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Aldridge, Austin & Tree JJ) delivered on 3 February 2020.
Associate:
Date: 3 February 2020
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