SOMERS & SOMERS - [2011] FamCA 103

FAMILY COURT OF AUSTRALIA

SOMERS & SOMERS

[2011] FamCA 103

FAMILY LAW - COSTS – Circumstances justifying order

Family Law Act 1975 (Cth)

Abbott and Langton (Costs) [2011] FamCA 26
Charles and Charles [2007] FamCA 276
Child Support Registrar and Kanavos and Ors [2010] FamCAFC 244
Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225
Fitzgerald(as child representative for A(Legal Aid Commission of Tasmania)) v Fish and Anor (2005) 33 FamLR 123
Fennessy and Gregorian (2009) FLC 93-399
JEL v DDF No 2 (2001) FLC 93-013
Roth v Quinn [2005] FamCA 6
Sharma and Sharma (No 2) [2007] FamCA 425
Yunghanns v Yunghanns (2000) FLC 93-029

APPLICANT:

Mr Somers

RESPONDENT:

Ms Somers

FILE NUMBER:

MLC

2109

2009

DATE DELIVERED:

28 February 2011

PLACE DELIVERED:

Melbourne

PLACE HEARD:

Melbourne

JUDGMENT OF:

Justice Cronin

HEARING DATE:

By way of written submissions

SUBMISSIONS RECEIVED FROM:

SOLICITOR FOR THE APPLICANT:

Kliger Partners

SOLICITOR FOR THE RESPONDENT:

Perisic & Thomas Lawyers

Orders

That the mother pay the father’s costs of and incidental to the proceedings fixed in the sum of $60,000.

IT IS NOTED that publication of this judgment under the pseudonym Somers & Somers is approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLC 2109 of 2009

Mr Somers

Applicant

And

Ms Somers

Respondent

REASONS FOR COSTS JUDGMENT

On 20 December 2010, I made final parenting orders which included provisions for parties to make submissions in the event of any application for costs.
The father filed an application for costs supported by written submissions dated 12 January 2011. I am satisfied on the material presented to me that the documents were served that same day upon the legal practitioners then acting for the mother.
It seemed common ground that the mother is an undischarged bankrupt and apparently as a matter of precaution, the solicitor for the father served upon the trustee in bankruptcy notification that an order for costs was to be sought.
No response to the father’s application was received from the mother or any person on her behalf nor was any response received from the Trustee in Bankruptcy.
The application seeks approximately $238,600 by way of an order for costs. Attached to the application were the relevant corroborating documents including the costs agreement and copies of various accounts. I am satisfied that the father has incurred the costs alleged.
The costs pursued by the father fall into three categories. The first relates to costs based upon s 117AB of the Family Law Act 1975 (Cth) (“the Act”), the second relates to indemnity costs and the third relates to costs otherwise in accordance with the Schedule to the Family Law Rules 2004. In respect of the second claim, as is required, I have seen and read the costs agreement executed between the father and his legal practitioner.
I think it is important to first deal with the application for costs pursuant to s 117AB of the Act.
Section 117AB of the Act was inserted to address expressed concerns about parties who made allegations of abuse in family law proceedings in an environment where costs were generally the exception rather than the rule.
In 2006 in debate on amendments to the Act, the then attorney-general referred to the inclusion of the provision arising out of a parliamentary recommendation. He said that a high test was applied before the provision could be implemented against a person and that that person must have knowingly made a false statement.
In Charles and Charles [2007] FamCA 276, I commented that s 117(1) (the provision relating to each party paying their own costs) must be read subject to s 117AB. I then said:
24.“Knowingly” imports a serious subjective element into the question. In respect of many findings of fact as in this case, a trial judge determines which of two versions, sometimes diametrically opposed to one another, he or she believes on the balance of probabilities. Such a finding is not necessarily a statement that one version is patently untrue or that a person is lying; it may simply be that one version is more probable than another. For a court to be satisfied that a person knowingly made a false allegation or statement in the proceedings must mean that a court can be comfortable in finding that the person lied. It would not simply then be a balancing act between two versions. To be satisfied that a lie has been told and to so find requires a careful analysis of two things. The first is that the proffered version of fact is untrue but the second is that it is put knowing it to be untrue. A court must then be cautious about such a finding because of the mandatory consequence. The finding must be elevated above the “probable” level set out in s 140(1) of the Evidence Act 1995 to consider the matters contemplated in s 140(2) of that Act. That is, the Briginshaw[1] test applies.
[1] (1938) 60 CLR 336
In Abbott and Langton (Costs) [2011] FamCA 26 at para 80 and in Child Support Registrar and Kanavos and Ors [2010] FamCAFC 244 Boland J made reference to my decision in Charles and Charles without criticism. In those decisions, Boland J went on to refer to the decision of Ryan J in Sharma and Sharma (No 2) [2007] FamCA 425. I think it is clear that even though the test is high, there does not necessarily need to be a specific finding that someone lied. All that is required is that the only inference from the finding that is open is that the evidence was untrue. That is distinctly different from a finding that one version is preferred over the other. It also means that the inference cannot support a conclusion that the statements were mistakenly or recklessly made.
If on an application under s 117AB, a finding can be made that the only inference open was that the evidence was rejected because it was a lie, the mandatory provision of s 117AB applies.
In this case, I delivered two significant judgments. In July 2010, I found that the following:
·there was no evidence to support an assertion made by the mother in evidence that the father was poisoning the child (paragraph 34);
·I did not accept the evidence of the mother that the father was violent to her (paragraph 37);
·The mother’s explanation about the interpretation by Dr E as to her statement made to him, was implausible (paragraph 38).
I am comfortable in finding that each of those matters amounts not to a reckless statement but to a deliberate lie. The provisions of s 117AB therefore apply.
At paragraph 40 of my reasons, I commented that I rejected the mother’s statement that the father was a paedophile and sadistic. That was not a statement of fact but rather one of an opinion and therefore not applicable for the purposes of the application before me.
In December 2010, I concluded the hearing and made final orders supported by reasons. In those reasons, I said there was no substance to the mother’s periodically made accusations against the father of sexual abuse. The only conclusion one could draw from that finding was that the accusations were a lie.
At paragraph 104 of my reasons, I referred to the mother’s version of an incident that occurred after a contact period when she took the child to the hospital. Her evidence was in conflict with that of the notes relating to the hospital’s attendance. In discussing that evidence, I found her explanation implausible. The only inference open to me was that her evidence was not reckless or mistaken but rather a lie.
For those reasons, the provisions of s 117AB apply.
The relevant provision requires that once that finding is made a party must be ordered to pay some or all of the costs of another party. In this case, considerable time was spent on the specific allegations but there was equally an amount of time spent dealing with general parenting capacity and responsibility.
Once a determination is made that an order must be made, the only logical approach is to consider the relevant provisions of s 117(2A) bearing in mind they give guidance to the sorts of considerations in determining quantum of costs.
The second category of costs sought related to indemnity costs. That is, that a party should pay whatever costs were incurred by the other party despite those costs being inconsistent with the approved scale.
In Roth v Quinn [2005] FamCA 6, an unreported judgment of the Full Court delivered on 6 January 2005, the Court considered the question of indemnity costs. In that case their Honours referred to the decision of the Full Court in JEL v DDFNo 2 (2001) FLC 93-013 at 88,441-2, where the Full Court said:
The category of cases in which it would be appropriate to make an order for indemnity costs does not appear to have been fully defined. The Full Court has, however, set out some general principles.
The general principles to which the Full Court referred were largely reflected in cases such as Colgate Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225 and Yunghanns v Yunghanns (2000) FLC 93-029.
In Yunghanns, the Court included as a principle that indemnity costs might be given in a case where there was a collateral purpose (for the proceedings) or there was a species of fraud involved. The Full Court said that the categories were not closed.
In Fennessy and Gregorian (2009) FLC 93-399 the Full Court (Coleman, Boland and Thackray JJ) rejected an application for indemnity costs finding that the proceedings were not special or unusual or of such an exceptional kind as to justify making that award. Their Honours used words such as “extraordinary conduct”.
It may very well be academic having regard to the mother’s parlous financial state but a court should be cautious even where allegations of a serious nature are made from deterring people from bringing them just because their allegations cannot be corroborated by any concrete means. That was not the case here. Various allegations made by the mother could have easily been supported by corroborating material and she failed to call that evidence. I conclude therefore that her conduct was extraordinary thereby justifying an order for indemnity costs.
Having made that finding, there is still the requirement of the exercise of discretion and consideration of the matters in s 117(2A). I turn to those matters now.
I did not have the benefit of any submissions or material from the mother nor did either party file a financial statement. However the following matters were submitted by the father’s solicitor to be relevant:
·The father is self-employed and the mother is engaged in home duties but is an undischarged bankrupt;
·The mother was assisted by Victoria Legal Aid but the details of that are otherwise unknown;
·The mother had been wholly unsuccessful in the proceedings in that orders were made against her removing the child from her permanent care; and
·No offers of settlement were made.
Section 117(2A)(e) also requires consideration of whether any party to the proceedings has been wholly unsuccessful. That must be said in this case of the mother.
Section 117(2A)(d) requires consideration of whether or not the proceedings were necessitated by a failure of a party to comply with previous orders. Although there has been litigation of a dispute about contravention of the orders, I do not take those matters into account.
The Full Court observed in Fitzgerald(as child representative for A(Legal Aid Commission of Tasmania)) v Fish and Anor (2005) 33 FamLR 123 nothing in s 117(2A) requires that one factor must be given more weight than others and as a consequence, there is nothing to prevent one particular factor being the foundation for an order for costs. All matters must however be considered.
The last of the factors in s 117(2A)(g) relates to any other matters that the Court considers relevant and to a very large degree, that catch-all includes such considerations as the fact that the litigation went on for many days as a result of the allegations being so made. This litigation was also protracted by virtue of the fact that the father had had such a limited role in the child’s life requiring an interim determination in July to remove restrictions on his time with his daughter. All of those matters are relevant when contemplating the quantum to be ordered once the Court finds that there are justifying circumstances for making an order including an order for indemnity costs.
Notwithstanding the case was protracted thereby increasing the costs of the father, he pursued an order that A, his daughter, live with him and even absent allegations of sexual abuse by the mother, that would have required litigation.
As I mentioned earlier, no one factor is determinative. Poor financial circumstances such as may be anticipated in relation to the mother, would not alone be a reason not to make an order. Those circumstances may change in the future. Similarly, just making a nominal order for costs would fly in the face of a finding that costs were justified where the principle behind making an order for costs is not punishment but rather compensation for the party otherwise engaged in the litigation.
The difficulty in this case is the quantum. In the submission on behalf of the father, the following appeared:
The usual order of costs as agreed or otherwise as taxed is likely to be manipulated by the Respondent into an elaborate and expensive exercise that will delay and erode the utility of such an Order.
The difficulty with that submission is that one would expect the utility of the order to be minimal having regard to the acknowledged bankruptcy of the mother. The elaborate and expensive exercise would also be creating further costs for the father in circumstances where it would be unlikely that the mother would be in a position to dispute the specific items of costs having regard to the findings I have made above.
The submission of the father said that the respondent should be ordered to pay all or part of the father’s costs fixed in a sum acceptable to the Court. The details in the accounts are extensive and I have endeavoured to examine them in the context of knowing that the case ran for many days and there was significant affidavit material. In my view, within the parameters of what is sought, I think it is appropriate to exercise a discretion having regard to all of the findings made above. I propose to make an order that 25 per cent of the father’s costs be paid by the mother predominantly because of the fact that at least a portion of the dispute related to the sexual abuse allegation but a significant part of it otherwise related to the question of parenting capacity.
Accordingly, I order that the mother pay the father’s costs fixed in the sum of $60,000.

I certify that the preceding Thirty Eight (38) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Cronin delivered on 28 February 2011.

Associate:

Date: 28 February 2011