Slack and Zimmer (No.2)

[2010] FMCAfam 1136

FEDERAL MAGISTRATES COURT OF AUSTRALIA

SLACK & ZIMMER (No.2) [2010] FMCAfam 1136

FAMILY LAW – Costs ruling.

Family Law Act 1975, s.117

Applicant: MS SLACK

Respondent: MR ZIMMER

Intervener: MS E

File Number: MLC 9085 of 2009

Judgment of: Burchardt FM

Hearing date: 6 October 2010

Date of Last Submission: 6 October 2010

Delivered at: Melbourne

Delivered on: 6 October 2010

REPRESENTATION

Counsel for the Applicant: Mr R. Weil

Solicitors for the Applicant: Hogg & Reid

The Respondent: No appearance

Counsel for the Intervener: Ms N. Udorovic

Solicitors for the Intervener: Nicholes Family Lawyers

ORDERS

1. The Respondent pay the cots of the Applicant and the Intervener, each fixed at $65,000. 

IT IS NOTED that publication of this judgment under the pseudonym Slack & Zimmer (No.2) is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL MAGISTRATES
COURT OF AUSTRALIA
AT MELBOURNE

MLC 9085 of 2009

MS SLACK

Applicant

And

MR ZIMMER

Respondent

MS E

Intervener

REASONS FOR JUDGMENT

(Ruling)

1. In this matter both the applicant and the intervener have sought that I make orders as to their costs. Each of them seeks that the respondent pay their costs and that the Court fix them, rather than submit them to a process of taxation. The relevant principles to which the Court is required to have regard are set out in s.117 of the Family Law Act 1975 (“the Act”). It should be noted that, pursuant to s.117(1), the basic position is that subject to subsection (2), each party bears their own costs. Subsection (2) reads:

   “If, in proceedings under this Act, the court is of the opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4) and (5) and the applicable Rules of court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.”

2. Subsection (2A) requires the Court to consider the following questions: First,

   “(a)  the financial circumstances of each of the parties to the proceedings;”

3. Here, I accept that the respondent is wealthy, although as I have explained, it is not possible to say exactly how wealthy.  He is plainly a man of considerable means.  The applicant, Ms Slack, is in dire circumstances, although the outcome of these proceedings will ameliorate her position somewhat and the position of the intervener is likewise extremely modest as to finances. 

4. The next matter the Court is required to consider is Legal Aid and nobody, as far as I am aware, has Legal Aid. 

5. The third matter the Court is required to consider is the conduct of the parties to the proceedings.  In this case I accept the submission advanced by counsel for the applicant that the respondent’s conduct has been outrageous.  He has made a number of assertions that he has been completely unprepared to test by attending.  His assertions as to ill-health preventing him from travelling have not been tested because he has not attended to do so.  But one has to say the tender of most recent material filed, bringing in to play alleged illnesses on the part of other family members to whom no prior reference had ever been made, leaves the Court with the gravest doubts that he is in fact being truthful.  In my view, it is fair to say that his assertions that he was a stakeholder of the funds that have now been disposed of, in circumstances where he has not been prepared in any way to actively prosecute that very important assertion, only go to suggest in the strongest terms that he has been lying through his teeth throughout and his general non-cooperation with the proceedings is of itself quite outrageous. 

6. The next matter is whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the Court.  I think that in the circumstances is subsumed within the matter I have just dealt with. 

7. The next matter is whether any party has been wholly unsuccessful in the proceedings and plainly the respondent has been wholly unsuccessful.  I am not aware of any offers that might otherwise impact upon the matter.  There are in the circumstances no other relevant considerations. 

8. I have already had reason to observe in the Reasons for Judgment that this is an extraordinary case and it remains so.  In the particular circumstances of the case I think a proper exercise of the Court’s discretion, bearing in mind all the matters to which I have referred, is that the respondent should indeed be ordered to pay the costs of both the applicant and the intervener.  I also think it is appropriate for the Court to fix those now, rather than putting the parties to the further expense of taxation. 

9. The taxation would necessarily cost the parties money now which they may, but might not, ever recover.  The figures asserted of about $80,000 by each side would ordinarily seem grossly disproportionate and high.  However, I accept that the conduct of the respondent in putting in issue various matters in China, which must have required some measure of investigation and which I have been informed without challenge is itself expensive, is such that in the ultimate I am prepared to accept that those figures have been expended and indeed, given that I am given those figures by officers of the Court, I would have no reason to doubt them. 

10. However, as I explained to counsel this morning, the fixing of costs on an indemnity basis presents some difficulties in the scheme with which we are concerned set by s.117. In all the circumstances, and acknowledging elements of imprecision, I have felt it appropriate to allow $65,000 to each of the applicant and the intervener. That is approximately 75 to 80 per cent of their indemnity costs and in my view, that proportion is an appropriate one bearing in mind the uncertainties with which we are dealing and all the relevant matters to which I have referred.

I certify that the preceding ten (10) paragraphs are a true copy of the reasons for judgment of Burchardt FM

Date:  6 October 2010