Sharma & Sharma (No 2)

In *Sharma & Sharma (No 2)*, the Family Court of Australia considered an application by the husband for indemnity costs against his former wife concerning parenting proceedings. The husband had sought orders for the parties' two daughters to live with him, or alternatively, for equal time arrangements. The Court ultimately made equal time orders. The wife opposed the husband's application for costs.

The central legal issue before the Court was whether the wife had knowingly made false allegations or statements in the proceedings, which would trigger a mandatory costs order under section 117AB of the *Family Law Act 1975* (Cth). A further issue was the appropriate quantum of costs to be awarded, and whether an indemnity costs order was warranted. The Court also had to determine the operative date of section 117AB, considering the presumption against retrospectivity.

Justice Ryan found that the wife had knowingly made false statements and allegations, particularly in relation to her evidence before Justice Waddy and in her trial affidavit, and that these were central to the proceedings. Consequently, section 117AB applied, mandating a costs order. While the Court acknowledged that the making of allegations that ought never to have been made can warrant indemnity costs, it declined to award them in this instance, considering the totality of the circumstances, including the recent legislative changes and the wife's reasonable, albeit ultimately unsuccessful, resistance to the husband's primary application. The Court determined that a costs order of 25% of the husband's final hearing costs was appropriate, fixed at $3,195, to be paid by the wife within nine months. The husband's application for interim orders was dismissed, save for the costs order.