Skinner & Alfonso-Skinner (Costs)
[2010] FamCA 1108
•7 December 2010
FAMILY COURT OF AUSTRALIA
| SKINNER & ALFONSO-SKINNER (COSTS) | [2010] FamCA 1108 |
| FAMILY LAW – COSTS – Between parties – Where the wife was successful in substantive proceedings – Where the wife seeks order for costs – Whether s 117 applies – Where the husband ordered to pay the wife’s costs of and incidental to the proceedings |
| Child Support (Assessment) Act 1989 (Cth) Civil Procedure Act 2005 (NSW) Corporations Act 2001 (Cth) Family Law Act 1975 (Cth) Family Law Rules 2004 (Cth) Judiciary Act 1903 (Cth) |
| Bale-Sutch and Bale-Sutch [2007] FamCA 463 at 13 Dobson v Van Londen (2005) 33 FamLR 525 Henry v Henry (1996) 185 CLR 571 In the Marriage of B [2003] FLC 93-136 Warby & Warby [2002] FLC 93-091 |
| APPLICANT: | Ms Alfonso-Skinner |
| RESPONDENT: | Mr Skinner |
| FILE NUMBER: | SYC | 5175 | of | 2009 |
| DATE DELIVERED: | 7 December 2010 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | Murphy J |
| WRITTEN SUBMISSIONS: | Wife: 18 May 2010 Husband: 3 June 2010 Wife in reply: 4 June 2010 |
REPRESENTATION
| WRITTEN SUBMISSIONS ON BEHALF OF THE APPLICANT: | Mr Beaumont of Counsel |
| SOLICITOR FOR THE APPLICANT: | Barkus Doolan Kelly of Sydney |
| WRITTEN SUBMISSIONS ON BEHALF OF THE RESPONDENT: | Mr Grieve QC of Counsel |
| SOLICITOR FOR THE RESPONDENT: | Watson & Watson Solicitors of Sydney |
Orders
IT IS ORDERED THAT
The husband pay the wife’s costs of and incidental to these proceedings, including her costs in respect of the written submission as to costs, in such sum as agreed, or, failing agreement, as assessed.
IT IS NOTED that publication of this judgment under the pseudonym Skinner & Alfonso-Skinner is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth)
| FAMILY COURT OF AUSTRALIA AT BRISBANE |
FILE NUMBER: SYC 5175 of 2009
| MS ALFONSO-SKINNER |
Applicant
And
| MR SKINNER |
Respondent
REASONS FOR JUDGMENT
On 28 April 2010 I made orders and delivered reasons in this matter which involved competing applications in this jurisdiction and in Spain. Order 7 contemplated the receipt of written submissions in respect of any application for costs. The parties subsequently delivered written submissions pursuant to that order: on 18.05.2010 (the wife), on 3.06.2010 (the husband), and on 4.06.2010 (the wife in reply).
The wife, who was successful in the substantive proceedings, seeks an order for her costs. It is argued on her behalf that s 117 of the Family Law Act 1975 (Cth) (“the Act”) has no application to the substantive proceedings, and that, as a result, costs should follow the event. In the alternative it is argued that, if s 117 applies, reference to the factors in s 117(2A) of the Act point to an award of costs in her favour.
The husband asserts that the appropriate order is that there be no order for costs. But, as written submission on his behalf make clear, in doing so he “does not contest the contention that s 117 of the Act does not apply in the circumstances”. Relying upon Jones v Merionethshire Permanent Benefit Building Society [1892] 1 Ch 173 at 187-188 as “instructive”, it is submitted by the husband that a number of factors specified in the written submissions (which will be quoted below) “reflect very adversely upon the wife and give rise to an exceptional circumstance warranting departure from the general Rule that costs should follow the event”.
How is it Agreed that Section 117 Does Not Apply?
Despite the agreement just referred to, it seems to me that as a question of the Court’s jurisdiction and power is involved, I should satisfy myself as to the argument and concession.
The basis of the wife’s arguments are set out in written submissions filed on her behalf. I will likely do them an injustice in paraphrasing them but, given the agreement between the parties, I consider that brevity demands that I should.
I first turn to the decision of the Full Court in Sankil v Sankil [2007] FLC 93-351. As counsel for the wife properly points out, comments within that case appear to assume that an order staying proceedings in this Court would see any application for costs being determined pursuant to s 117.
The Full Court said in that case, relevantly:
98.We are not persuaded that the other matter which his Honour took into account in making the costs order, being the financial circumstances of the parties – the evidence concerning which was, as his Honour recognised, “untested” – and the success of the wife’s application – which may only ultimately be sustained because of subsequent events in India – would be sufficient to sustain or justify the costs order.
The appeal against the costs order made by the trial judge was, consequently, allowed. The Full Court observed (at par 31) that, subsequent to the initial substantive decision, the trial judge “heard and granted an application by the wife that the husband pay her costs of the proceedings heard on 18 and 19 July 2005”. The power upon which the trial judge relied in making that order for costs is not revealed in the Full Court judgment.
Steele J’s decision at first instance can be seen at ([2005] FamCA 1105). Each of the parties in that case were represented by counsel. Steele J’s (nine paragraph ex tempore) judgment does not reveal any argument by either counsel that the power to award costs is to be found anywhere other than in s 117. His Honour proceeds in the judgment to directly address the matters considered by his Honour as relevant to the exercise of the discretion pursuant to that section and, in particular, those contained in s 117(2A).
In those circumstances, it is entirely unsurprising that reference to the issue of costs in the decision of the Full Court is scant. The extensive reasons of the Full Court pertain to the substantive issues on the appeal which, in turn, relate to his Honour’s substantive judgment permanently staying an application. The Full Court’s decision with respect to costs addressed briefly (again, with respect, unsurprisingly), what the Full Court held to the error in the exercise of discretion by the trial judge pursuant to s 117(2A).
It is submitted on behalf of the wife in these proceedings that “no argument appears, from the face of the [Full Court] judgment to have been directed to challenging” the assumption that s 117 of the Act provides the power to make the award.” That submission is correct. As will be clear from what I have earlier said, the same can also be said in respect of the proceedings before Steele J at first instance.
I do not consider, then, that the decision of the Full Court in Sankil v Sankil provides any principle binding upon me with respect to the issue under discussion.
The argument that s 117 is not the source of power for the making of a costs order in this case derives from the terms of the section itself which provides relevantly that “subject to subsection (2) each party to proceedings under this Act shall bear his or her own costs”.
The wife’s submission is that the reference to proceedings “under the Act” meant precisely that and, as a result, ought be distinguished from proceedings that are not brought “under the Act” but pursuant to other aspects of the Court’s jurisdiction.
Counsel for the wife submits:
The section does not say, for example, that “each party to proceedings before the Court shall bear his or her own costs of the proceedings before the Court” nor does s 117 refer to “proceedings relating to this Act”.
An analogy is drawn by counsel between these proceedings in which the jurisdiction invoked is the Court’s (accrued) equitable jurisdiction (as found by me) and, s 1337(C) of the Corporations Act 2001 (Cth) which confers jurisdiction on this Court with respect to civil matters arising under the Corporations legislation. It is submitted that a matter emanating from that grant of jurisdiction could not be described as “proceedings under this Act” as specified in s 117.
Further, whilst, it has been determined that the apparent object of s 117 is to “ensure that spouses are not deterred from bringing or maintaining legitimate applications for fear of incurring an intolerable financial burden if they lose” (Bale-Sutch and Bale-Sutch [2007] FamCA 463 at [13]) “no such policy”, it is submitted, “is to be evinced”, for example, from the terms of the Corporations Act.
So, too, it is submitted that s 100 of the Child Support (Assessment) Act 1989 (Cth) is necessary for the very reason that proceedings under that Act are not “proceedings under this Act” within the terms of s 117.
It is submitted that “a proceeding under the Act is a proceeding which claims relief pursuant to a specified provision or provisions of the Act”. It is pointed out that s 117 does not use the language of “matter” or “matters arising under the Act” which such language is used in other provisions of the Act (see eg s 31; s 33). That “matter” and “proceedings” are not the same thing (the latter possibly being narrower than the former) was made clear in Re Wakim; ex parte McNally (1999) 198 CLR 511 at 586 and Warby & Warby [2002] FLC 93-091 (at par 79).
Thus, it is submitted, where the jurisdiction exercised by the Court is accrued equitable jurisdiction (or, indeed, the Court’s implied jurisdiction – CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 at 391-392), proceedings referenced to that jurisdiction are not proceedings “under the Act”.
That conclusion is reinforced, it is argued, by the determination of the Full Court of this Court that the Court has no statutory power (ie no power “under the Act”) to stay proceedings in favour of a foreign court; rather it has an implied power to do so (see In the Marriage of B [2003] FLC 93-136, par 51-57; EGK v TSL [2006] FLC 93-297, par 83(i) and (ii)).
I agree with the submissions just outlined and that the concession by counsel for the husband is properly made. I conclude that the power to award costs in respect of the instant proceedings does not lie pursuant to the Act (and, specifically, s 117). If such a power exists, it needs to be found elsewhere.
The Source of the Power to Award Costs
Section 79(1) of the Judiciary Act 1903 (Cth) provides:
(1)The laws of each State or Territory, including the laws relating to procedure, evidence, and the competency of witnesses, shall, except as otherwise provided by the Constitution or the laws of the Commonwealth, be binding on all courts exercising federal jurisdiction in that State or Territory in all cases to which they are applicable.
The proceedings here were heard and determined in New South Wales. Section 98 of the Civil Procedure Act 2005 (NSW) provides relevantly:
(1) Subject to Rules of Court and to this and 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.
…
(4)In particular, at any time before costs are referred for assessment, the court may make an order to the effect that the party to whom costs are to be paid is to be entitled to:
(a) costs up to, or from, a specified stage of the proceedings, or
(b) a specified proportion of the assessed costs, or
(c) a specified gross sum instead of assessed costs, or
(d)such proportion of the assessed costs as does not exceed a specified amount.
It is submitted on behalf of the wife (and does not appear to be challenged by the husband) that, by reason of s 79 of the Judiciary Act, s 98 of the Civil Procedure Act just referred to, governs the award of costs in this case.
I also agree with that submission.
Should Costs be Awarded in this Case?
Counsel for the wife places reliance upon the decision of the Supreme Court of NSW (Barrett J) in Du Bray v McIlwraith (2009) 259 ALR 561. That case, too, involved applications in competing jurisdictions (NSW and New Zealand). The court granted a stay of the NSW proceedings and reference was there made to the principles emanating from the decision in Henry v Henry (1996) 185 CLR 571; CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345 and Dobson v Van Londen (2005) 33 FamLR 525. In that case, costs followed the event.
The written submissions on behalf of the husband make reference to paragraph 43 of the wife’s written submissions. That paragraph is as follows:
43.This is a case where the wife, with a very significant lower share of the financial resources of the parties, and with the care of the two young children, was left no practical alternative but to bring the proceedings which she brought in Spain and then to defend, with complete success, the attempt by the husband to subvert that course.
In written submissions on the husband’s behalf from Mr Grieve QC it is submitted:
The contention in paragraph 43 of the wife’s submissions … is a significant and serious distortion of the truth of the matter, which includes:
·The fact that the wife falsely asserted to the court in Spain that the husband’s place of residence was the address at which she lives in Madrid;
·The fact that the wife falsely asserted to the court in Spain [that] the husband had abandoned the children;
·The fact that the wife made those false assertions knowing them to be untrue and with the object of persuading the Spanish court erroneously to find that it had jurisdiction to entertain the proceedings which she had purportedly instituted in that court; and
·The fact that the wife has from the outset expressed a desire to invoke the jurisdiction of this court in order to prosecute a claim for a property settlement under section 79 of the Family Law Act.
The English decision of Jones cited by Mr Grieve as “instructive” relates to an action in respect of an agreement which was ultimately held to be founded on illegal consideration and, thus, void. The passages specifically referred to by Mr Grieve appear in the judgment of Lindley LJ who held:
As regards the costs, it is very unusual for this court to dismiss an unsuccessful appeal without costs; but there are grounds here which induce us to do it. The grounds are these: but for the order of February, to which I have referred, that Chancery action ought to have been dismissed with costs. That order, having regard to the terms of it, we have passed over, and the order of the judge stands in the Chancery action. We are very much struck with the character of the defence and the circumstances under which it was raised. It is an extremely discreditable defence, to which we are compelled to give effect upon grounds of public policy. Upon these grounds, therefore, the appeal will be dismissed without costs.
It can be seen, that central to the submission made on behalf of the husband, are a number of findings of fact. Each have at their core, a contention that the wife has made false assertions to a court (in Spain) and did so “knowing them to be untrue” and for an improper purpose. That is to say, the assertion made against the wife is that she has intentionally perpetrated a deceit on a court in order to obtain an advantage.
Those findings are, of course, of the gravest kind. In many respects, they repeat assertions made at the substantive proceedings before me. The findings there made should be taken as relevant to those assertions in the context of this application. It is, I think, preferable to repeat the relevant paragraphs of my earlier judgment:
11.A further hearing was convened on the first available date, 19 April and, in contemplation thereof, affidavits filed on behalf of each of the parties. What had occurred in the family court of Madrid can be briefly summarised as follows (framed in language familiar to this court).
12.The husband asserted that the wife purported to serve him with the Application for Divorce at the former matrimonial home in Madrid, knowing full well that he lived predominantly in Australia. In “nullifying” the summons to him in respect of Divorce, the court held:
…it has been proven that the [husband] has been summoned at the former conjugal home [in Madrid] as the [wife] requested. When the truth is that, after abandoning such address in January, 2008, he is residing in [Sydney]
…it is proper to declare the nullity of the summons made on [the husband], and he is newly summoned …to appear on the scheduled date.
13.The husband appealed. The court had held that the husband had (through his Spanish lawyer) appeared at the first hearing; the husband contends the appearance was strictly limited to challenging the Spanish court’s jurisdiction and that, therefore, the court did not have the jurisdiction to re-summon him (presumably without first determining jurisdiction).
14.The Spanish court dismissed the appeal saying:
As a result of all this, the appeal for reversal of the court’s decision … must be dismissed because we cannot admit that they only had powers to challenge the jurisdiction of the special Courts, and it would be against [the husband’s] own acts, because of that stated above.
However, and given the Court Representative’s and the Attorney’s refusal to consider that they have appeared for all purposes in these proceedings, and to avoid any further delays, the notice of the complaint shall be personally served on the defendant …”
15.The wife argues that the Spanish court has determined it has jurisdiction to hear and determine the wife’s divorce application. The husband contends that, upon the “re-summoning” of the husband consequent upon personal service, he will be entitled to challenge the jurisdiction of the Spanish court to hear the divorce. The latter seems, intuitively, more likely to me but for reasons which will emerge, it is not necessary (nor in my view proper having regard to issues of international comity) to make a finding (or purport to make a finding) in respect of that issue.
16.A similar argument emerges in respect of the ancillary relief sought by the wife in Spain. The Spanish court has made orders in favour of the wife that can conveniently be described as orders for custody and child support. The husband argues that each are based on a falsehood (that he “abandoned his children”) in the same way that service of the Divorce process was based on a falsehood (residence in Madrid). It is said by the husband that jurisdiction can be challenged in respect of this relief also.
17.Mr Beaumont does not seek findings from this court in respect of the jurisdiction of the Spanish courts nor, indeed, the propriety or otherwise of the Spanish orders. Rather, he submits, the proceedings in Spain have now plainly advanced beyond the “pleading stage” and their progress has, of itself, relevance to the matters that this court ought consider by reference to the decision of the High Court in Henry v Henry (1996) 185 CLR 571 (“Henry”).
18.Mr Grieve QC, counsel for the husband, submits that the only progress that can be seen to have been made within that context is “the making of an ex parte order based on a false factual premise” (that the husband had “abandoned his children”).
19.Before deciding upon the place of the evidence thus introduced at the re-opened proceedings, and its weight, it is first necessary to outline the proper legal and factual context of these proceedings.
The facts and circumstances before this Court at the time of the hearing of the initial application, and the nature of the proceedings there conducted, did not give rise to any findings of fact in respect of the conduct of the parties – let alone the grave findings founding the submission made on behalf of the husband in this application.
The circumstances in Jones are in my view entirely different. Borrowing the words of Bowen LJ in that case (at 183) “this case appears to me to be one not free from difficulty, the difficulty arising out of the facts which were proved at the trial and not from the law, about which I do not suppose very much doubt can be entertained”. Putting it succinctly, the plaintiffs in that case had the law on their side but, morally, no merits. It is in those circumstances that the court referred to the “extremely discreditable defence” which ultimately saw the plaintiffs succeed, but which also resulted in them, on appeal, not receiving costs, despite success in that appeal.
Here, no factual findings have been made sufficient to support the assertion that there should be no order as to costs.
The fourth of the bullet points, contained in the husband’s written submissions earlier set out, seems to me to also seek to re-agitate an issue in respect of the issue of costs about which a finding contrary to the submissions of the husband was made in the substantive proceedings. There, the husband contended that the bifurcation of proceedings, as sought, in effect, by the wife, pointed against the relief that she sought. Ultimately findings were made contrary to that submission (see pars 84 ff of the reasons for judgment in those substantive proceedings).
There is, in my view, no merit in this contention.
In my judgment, no factor points to an order other than that costs should follow the event.
I will order that the husband pay the wife’s costs of and incidental to these proceedings, including the wife’s costs in respect of written submission as to costs, in such sum as agreed, or, failing agreement, as assessed.
I apologise to the parties and the respective legal practitioners for the delay in the delivery of this judgment.
I certify that the preceding forty (40) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Murphy delivered on 7 December 2010.
Associate:
Date: 7 December 2010
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