Stinson & Goldsmith
[2022] FedCFamC1F 524
•22 July 2022
Federal Circuit and Family Court of Australia (DIVISION 1)
FIRST INSTANCE
Stinson & Goldsmith [2022] FedCFamC1F 524
File number(s): BRC 397 of 2018 Judgment of: CAREW J Date of judgment: 22 July 2022 Catchwords: FAMILY LAW – PROPERTY – ENFORCEMENT APPLICATION – LIBERTY TO APPLY – Where upon hearing the application the Court made amendments to consequential or machinery orders within a previous final property order made 23 July 2021 – Where the parties competing enforcement applications are dismissed.
FAMILY LAW – COSTS – Where the wife pay the husband’s costs of and incidental to the application in a fixed sum.
Legislation: Family Law Act 1975 (Cth)
Federal Circuit and Family Court of Australia Act 2021 (Cth)
Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)
Cases cited: Fitzgerald vFish; sub nom PBF v TRF (FLR) (2005) 191 FLR 294
McMillan & McMillan [2016] FamCA 387
In the Marriage of Mohlier & Van Wyk (1980) 7 Fam LR 18
Penfold v Penfold (1980) 144 CLR 311
In the Marriage of Ravasini (1982) 8 Fam LR 903
Stopford Malloy & Malloy (Costs) [2018] FamCAFC 6
Number of paragraphs: 68 Date of hearing: 21 July 2022 Place: Brisbane Counsel for the Applicant: Mr T. Kirk QC Solicitor for the Applicant: Phillips Family Law Counsel for the Respondent: Mr K. Wilson QC Solicitor for the Respondent: Pippa Colman & Associates Law Practice
Table of Corrections 16 September 2022 On page ‘i’ at the top of the Order the Applicants name was incorrect. Originally written as “MR X STINSON” has been corrected to “MR STINSON”. It is noted the error was not repeated on the Order published on the Commonwealth Courts Portal dated 22 July 2022. ORDER
BRC 397 of 2018 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 1)
BETWEEN:
MR X STINSON
MR STINSONApplicant
AND: MS GOLDSMITH
Respondent
order made by:
CAREW J
DATE OF ORDER:
22 July 2022
Amended pursuant to the rule 10.13(1)(h) of the Federal Circuit and Family court of Australia (Family Law) Rules 2021 (Cth) on 16 September 2022.
THE COURT ORDERS THAT:
1.Pursuant to the liberty to apply provision in paragraph 27 of the Order made on 23 July 2021, paragraphs 17, 18 and 21 be amended such that the words “within 60 days of the date of this Order” be replaced with the words “within 14 days of the date of the Order made 22 July 2022” and that the sum of “$602,415” in paragraph 21 of the Order made on 23 July 2021 be replaced with the sum of “$502,415”.
2.The Application for Enforcement filed on 15 July 2022 and the Application for Enforcement filed on 20 July 2022 be dismissed.
3.The wife pay the husband’s costs of and incidental to the application fixed in the sum of $5,500.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 10.14(b) Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 10.13 Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
Section 121 of the Family Law Act 1975 (Cth) makes it an offence, except in very limited circumstances, to publish proceedings that identify persons, associated persons, or witnesses involved in family law proceedings.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Stinson & Goldsmith has been approved pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
EX TEMPORE REASONS FOR JUDGMENT
CAREW J:
This is a most unfortunate case. There have been two final property trials (the second being a re-hearing after a successful appeal by Ms Goldsmith (“the wife”) followed by a further appeal by the wife which was dismissed with costs. There are now competing enforcement applications before me for determination. Alternatively, the matter returns to Court pursuant to a liberty to apply provision seeking, in effect, an extension of time for the husband to comply with the provisions of a final property order made by me on 23 July 2021 (“the final order”).
I note that, to date, Mr Stinson (“the husband”) has incurred legal fees of $670,830 and the wife has incurred legal fees (not including the current applications) of $1,181,436 and the wife was ordered to pay the husband’s costs of the second appeal fixed in the sum of $14,500. Each party has been advised that their estimated further legal fees will be up to $10,000 in the case of the husband and up to $33,000 in the case of the wife. The net property of the parties or either of them at the time of the re-hearing before me in April 2021 was $5,254,763, which is to be divided in the proportion 57.5 percent to the husband and 42.5 percent to the wife.
Background to the current applications
The final order required, among other things, that the husband and the wife transfer their joint interest in a business property known as Property E to the husband and, contemporaneously with that transfer, the husband was to refinance the mortgage secured on that property into his sole name and to pay the wife $602,415 (see paragraphs 17, 18 and 21 of the final order). These actions were to occur within 60 days of the final order, namely by 21 September 2021.
On 20 August 2021, the wife appealed, but did not serve her Notice of Appeal on the husband until 1 September 2021.
In preparation for complying with the final order, the husband had sold two investment properties and made arrangements to borrow the balance required to pay out the wife.
On 7 September 2021, the husband sought the wife’s consent for a stay of part of the final order including paragraphs 17, 18 and 21 pending the outcome of the wife’s appeal. The wife was in the process of retaining new lawyers and the husband’s indulgence was requested. Accordingly, the husband took no further steps at that time.
On 13 September 2021, the wife refused the stay, and indicated that she was ready to settle but additionally, offered an undertaking to hold on trust all bar $100,000 of the sum required to be paid by the husband, pending the outcome of her appeal. The offer was rejected by the husband, who contended that the borrowing costs of about $23,000 and the interest on servicing the loan would be lost in the event that the wife’s appeal succeeded. Further, if the wife was also successful in the order she sought on appeal, namely, to retain 60 percent of the property pool, the husband contended that he would be unable to fund the balance required to buy her out. The wife contends that any such detriment could have been addressed by the Full Court depending upon the outcome of the appeal.
On 17 September 2021, the husband filed an application to stay the operation of part of the final order including paragraphs 17, 18 and 21. Although an urgent date was requested by the husband, the Court registry did not immediately allocate a date for hearing, and when a date was allocated it was not until after the 21 September 2021, namely on 1 October 2021.
On 20 September 2021, having not heard from the Court registry despite numerous communications, the husband requested that the wife consent to him contacting my Chambers to seek an urgent listing. The wife refused his request. Despite the urgency, the husband did not unilaterally contact my Chambers as he would have been permitted to do.
The husband’s application for a stay was heard by me on 1 October 2021, by which time the husband was already in default of his obligations under the terms of the final order. I reserved my decision.
On 8 October 2021, prior to a decision on the stay application being handed down, the parties consented to an order staying the operation of paragraphs 17, 18, 19, 21, 22, 23 and 24 of the final order pending the outcome of the appeal but nevertheless requiring the husband to pay $100,000 to the wife, with each party reserving their rights to argue about the nature of that payment.
Paragraph 19 of the final order is a default provision requiring the sale of Property E in the event that the husband does not refinance the mortgage as required by paragraph 18 i.e. by 21 September 2021 and upon sale, the net proceeds are to be paid to the husband.
Paragraph 22 is also a default provision requiring the transfer of another business property known as Property D to the wife, in the event that the husband does not pay the wife $602,415 as required by paragraph 21 i.e. by 21 September 2021, and in that event the wife is to pay the husband $447,585.
Paragraph 23 requires the husband to provide a right of carriageway through another business property (to be retained by him) known as Property P, in the event that the husband is required to transfer Property D to the wife.
Paragraph 24 is a further default provision in the event of the wife failing to pay the husband $447,585.
It is common ground that the $100,000 already paid by the husband should be taken into account whatever the outcome of the competing applications now before me i.e. if the husband is to pay out the wife, he should pay the sum of $502,415 and if the wife is to buy out the husband, she should pay the sum of $547,585.
On 30 June 2022, the wife’s appeal was dismissed and on 4 July 2022 the husband sought to arrange settlement with the wife i.e. with him retaining Property E and paying out the wife’s interest in Property D.
On 5 July 2022, the wife enquired whether the husband’s finance had been approved and suggested settlement within seven days. This was a clear indication by the wife that, despite the husband’s default, she was prepared to proceed with the intent of paragraphs 17, 18 and 21 of the final order.
On 6 July 2022, the husband informed the wife that his bank had indicated they would be able to settle on 15 July 2022.
Contrary to the indication given on 5 July 2022, the wife on 8 July 2022 sought to rely upon the husband’s default of the final order and, in turn, to rely upon the default provisions in the final order, which would see Property E sold and Property D transferred to her and a sum paid by her to the husband.
On 15 July 2022, the husband filed an application to enforce paragraphs 17, 18 and 21 of the final order.
On 20 July 2022, the wife filed an application to enforce paragraphs 19, 22 and 23 i.e. the default provisions of the final order.
Each party is represented by Queen’s Counsel and it is common ground that if I amend the final order pursuant to the liberty to apply provision as sought by the husband, both enforcement applications should be dismissed.
What are the limitations on the power to amend a final order made pursuant to section 79 of the family law act?
It is also common ground that the power to amend, vary, alter or modify (all terms used historically in previous cases) a final order made pursuant to s 79 of the Family Law Act 1975 (Cth) (“the Act”) is confined to circumstances coming within s 79A of the Act (not applicable in the current case) or where the amendments affect machinery rather than substantive provisions of the order.
Paragraph 27 of the final order provides as follows:
That each party have liberty to apply upon the giving of 14 days’ notice in writing in relation to the implementation of this order.
In In the marriage ofMolier and Van Wyk[1] (“Molier”) the Full Court held as follows:
When the court has made an order (… under s 79) settling or altering interests in property, it is established that the order may not be varied as to its substance, but only in regard to the machinery provisions which give it effect. The court can, under general liberty to apply (or otherwise), make orders to give effect to its original order, by clarifying the intent of that order, or by altering its provisions in some manner which does not affect the parties' substantive rights.
[1] (1980) 7 Fam LR 18 at 25 “Molier”.
The Court went on to state that additional or consequential orders may be made if:
… necessary to give effect to the clear intention of the original order, where that order failed to cover certain eventualities, including the failure to comply with an order for the settlement of a lump sum within the time prescribed.[2]
[2] Ibid at 27.
In In the marriage ofRavasini[3] (“Ravasini”) the Full Court preferred the descriptor “consequential” to “machinery”[4] and went on to say the following:
In determining whether or not an order may be varied as a machinery order the enquiry must be firstly as to what part of the order is the substantive order and what part or parts of it merely follow that order as a necessary consequence. A court in making a property order might do no more than order that the property be sold and the proceeds equally divided. That is the substantive order. If the court at that time has before it sufficient evidence of the facts and circumstances it may go on and make appropriate "consequential" orders providing the machinery whereby the substantive order is to be carried out.[5]
[3] (1982) 8 Fam LR 903 “Ravasini”.
[4] Ibid at 905.
[5] Ibid at 907.
The husband submits that the amendments sought by him are machinery provisions. On the other hand, the wife submits that the effect of the amendments would be to vary the substantive provisions of the order, in that, once the default provisions were triggered, substantive rights for the wife in Property D were created.
The relevant parts of paragraphs 17, 18 and 21 of the final order provide as follows:
17. That within 60 days of the date of this Order the parties transfer to the husband all their right, title and interest in [Property E] and for that purpose the following shall apply:
…
18. That within 60 days of the date of this Order and contemporaneously with the transfer of [Property E] pursuant to paragraph 17 herein, the husband refinance into his sole name the joint [EE Bank] loan being mortgage registration number […] in favour of [EE Bank Australia Limited], and that the wife sign within seven (7) days of such request being made, an authority and any other document required by the mortgagee to facilitate the administrative process of release of the mortgage.
…
21. That the husband pay to the wife within 60 days of the date of this Order the sum of $602,415.
(Underlining added)
The effect of the order now sought by the husband would be to extend the time for him to comply with the final order and the sum payable, by replacing the underlined words as set out at [30] above, so the final order would read as follows:
17. That within 7 days of the date of the Order made on 22 July 2022 the parties transfer to the husband all their right, title and interest in [Property E] and for that purpose the following shall apply:
…
18. That within 7 days of the date of the Order made on 22 July 2022 and contemporaneously with the transfer of [Property E] pursuant to paragraph 17 herein, the husband refinance into his sole name the joint [EE Bank] loan being mortgage registration number […] in favour of [EE Bank] Australia Limited, and that the wife sign within seven (7) days of such request being made, an authority and any other document required by the mortgagee to facilitate the administrative process of release of the mortgage.
…
21. That the husband pay to the wife within 7 days of the date of the Order made on 22 July 2022 the sum of $502,415.
The wife argues that the suggested amendments cannot be considered without regard to the effect of paragraph 22 of the final order, which provides as follows:
22. That in default of the husband complying with paragraph 21 herein the husband shall transfer all his right title and interest in [Property D] to the wife free of encumbrance and the wife is to pay the husband within a further 60 days the sum of $447,585.
The wife argues that the amendments sought by the husband will affect her substantive rights because she has a current entitlement by virtue of paragraph 22 of the final order to acquire Property D from the husband for the sum specified.
The wife’s right to acquire (or, perhaps more accurately, retain) Property D, once transferred, is conditional upon her paying a sum of money to the husband, in default of which, the husband then has the right to elect which of three business properties will be sold in order to pay out the wife (see paragraph 24 of the final order).
I reject the submission by the wife that the amendments proposed by the husband are other than machinery or consequential provisions of the final order put in place to implement the clear intention of the final order, namely for the husband to retain the business properties unless he could not raise sufficient funds to buy out the wife’s interest and refinance the existing mortgage secured on Property E.
There can be no doubt about the intention of the final order when regard is had to my Reasons for Judgment at [91] and [92]:
91. Other than if the wife defaults in her payment to the husband (and that will only arise if the husband defaults on his payment to the wife), I do not intend to provide for the wife to retain any of the [business] properties. It is common ground that the [business] properties were always intended to one day be the husband’s property and that he largely conducted the [business] enterprises throughout the marriage and subsequent to separation. His long time aim has been to devote his full time attention to [business].
92. I am not at all attracted to the prospect of the parties becoming neighbours given the tensions between them and limited capacity to communicate. They also have young children and being exposed to unnecessary tension should be avoided if at all possible. Therefore the husband will have the opportunity to retain all the [business] properties and pay out the wife. There seems to be some prospect of him being able to borrow sufficient funds to do so.
Conclusion
If the final order is not amended, not only would the result defeat what was accepted at trial as common ground i.e. that the business properties were always intended to one day be the husband’s property, but it would also defeat the clear intention to avoid the parties being neighbours.
The unforeseen eventualities that occurred in this case i.e. the wife’s appeal and delay in service, the wife’s refusal of a stay of the final order and the difficulties in obtaining a listing for the stay application, all contributed to the final order not being implemented. In my view, the husband took all reasonable steps to implement the final order (until advised of the wife’s appeal), and thereafter to apply for a stay. I do not regard his failure to unilaterally contact my Chambers on 20 September 2021 as fatal. Nor do I regard the husband’s refusal to pay the $602,415 to the wife, to have been unreasonable, in the circumstances. I accept that the potential detriment to him was not insignificant and I am not persuaded that the detriment could necessarily have been addressed by the Full Court in the event the wife’s appeal had succeeded.
I propose to amend the final order as sought by the husband, although the time I propose to allow for implementation will be 14 days rather than seven days, as I note that paragraph 18 provides for the wife to have seven days to sign documentation. It may be that the documentation has been signed, in which case the seven days may not be problematic, but I will hear from the parties prior to formally pronouncing my order.
enforcement
In the event that I am wrong in my determination to amend paragraphs 17, 18 and 21 of the final order pursuant to a general power to amend machinery or consequential provisions of an order to enable the implementation, I will turn to consider the competing enforcement applications.
The discretionary power[6] to enforce an order is found in s 105 of the Act and the general powers of the Court as set out in the applicable rules of Court, include the power to make an order “in aid of the enforcement of an obligation”.[7]
[6] McMillan & McMillan [2016] FamCA 387 at [33].
[7] See r 11.07(e) of the Federal Circuit and Family Court of Australia (Family Law) Rules 2021 (Cth).
In Molier the Full Court said:[8]
It has been decided that while this Court has no power to vary an order for property settlement, it has power to enforce the order and to modify the machinery provisions of the order to effect enforcement provided that this does not affect the substantive property rights of the parties. This power exists whether or not liberty to apply is reserved in respect of the order …
(Citations omitted)
[8] Molier at 21.
Likewise in Ravasini the Full Court said:[9]
… [The Court] has power to enforce the order and to modify the machinery provisions of the order to effect enforcement provided that by so doing it does not affect the substantive rights of the parties.
…
Thus, as we have set out above, the substantive order cannot be varied but the enforcement provisions, the secondary orders made as a consequence of the substantive order, to give it operation and effect, can be varied. It is therefore the construction of the order itself that is to be examined and not the basis of fact on which it was made. The test is not whether the unchangeable or substantive order is a just or proper order — that is a matter for appeal or for an application under sec. 79A — but whether the part or parts of the order sought to be changed are part or parts of the substantive order or whether they are orders made to give efficacy to that substantive order.
[9] Ravasini at 906, 907.
The husband seeks to enforce paragraphs 17, 18 and 21 of the final order. Paragraph 17 of the final order requires both parties to transfer Property E to the husband. The wife resists doing so, relying upon the husband’s failure to have complied with the order by 21 September 2021 i.e. prior to the stay granted on 8 October 2021. Paragraph 18 requires the husband to refinance the mortgage and the wife is required to sign all necessary documents within 7 days of any request to do so, but the husband’s obligation to refinance is to be exercised contemporaneously with the joint obligations contained in paragraph 17. Paragraph 21 requires the husband to pay a sum of money to the wife on the same day as the wife transfers her interest in Property E to the husband.
The wife seeks to enforce paragraphs 19, 22 and 23 of the final order. Those paragraphs come into effect upon the husband defaulting on his obligations under the final order. Paragraph 19 requires Property E to be sold with the husband to retain the net proceeds. Paragraph 22 requires Property D to be transferred to the wife and for her to pay the husband $447,585. Paragraph 23 requires the husband to provide a carriageway through his property Property P to the wife.
In resisting the enforcement of paragraphs 17, 18 and 21, the wife relied upon a single judge decision of McMillan & McMillan[10] (“McMillan”) in support of the following propositions:
(a)It is only facts or circumstances arising since the date of the order sought to be enforced that will inform the discretion under s 105;
(b)The question for the Court’s consideration is whether in all the circumstances it is inequitable to enforce the order;
(c)The onus of showing that it is not equitable to enforce the order is upon the party so contending;
(d)Delay can be a relevant factor.
[10] [2016] FamCA 387.
Addressing those particular factors and accepting for that purpose that the propositions are soundly based, I note the following:
(a)The facts and circumstances arising, in the current case, since the date of the final order that will inform the exercise of the discretion include the following:
(i)The husband sold two investment properties and made arrangements to borrow funds in order to comply with his obligations under the final order;
(ii)The husband was not served with the wife’s Notice of Appeal until 1 September 2021;
(iii)The husband promptly sought the wife’s agreement to stay the final order on 7 September 2021 until after the outcome of her appeal;
(iv)The wife’s previous lawyers asked the husband not to do anything further pending the wife engaging new lawyers;
(v)The wife refused the husband’s request for a stay on 13 September 2021;
(vi)The husband promptly filed an application to stay the final order on 17 September 2021 with a request for it to be listed urgently;
(vii)Numerous attempts were made to contact the Court registry when the application was not immediately listed, to no avail;
(viii)On 20 September 2021, the husband sought the wife’s consent to contact my Chambers to seek an urgent date, but his request was refused;
(ix)The application was listed on 1 October 2021;
(x)On 8 October 2021, the parties consented to stay the operation of the final order and for the husband to pay the wife $100,000 which he did.
(b)Given the clear intention as expressed in my Reasons, namely, that the husband should be able to retain the business properties, if possible, and that it would be undesirable for the parties to be neighbours, I do not consider it inequitable to enforce the order as sought by the husband. For the same reasons, I do consider it inequitable to enforce the order as sought by the wife, notwithstanding the husband being in default.
(c)I do not regard the delays in this case to be determinative.
McMillan involved unique circumstances. However, the wife seeks to extrapolate particular discretionary factors in that case (in which an enforcement warrant was permanently stayed) to inform the exercise of discretion to enforce the final order in the current case. The wife submitted that the following similarities in that case should have the same consequence in the current case:
(a)The final order is unequivocal and unsatisfied. There is no room for ambiguity in interpretation;
(b)The husband has made no attempt at compliance (although a concession was made that the husband did in fact make attempts to comply in that he sold his investment properties and made arrangements to borrow the balance);
(c)The husband had failed to comply with the final order by 21 September 2021 (while that is true, it cannot be considered in isolation. The circumstances already discussed are relevant);
(d)The sum in question is not insubstantial, in that Property D was for the purposes of the proceedings valued at $1,050,000 and Property E was valued at $700,000;
(e)The wife has never abandoned her claim (although a concession was made that on 5 July 2022 the wife indicated her preparedness to settle on the terms promoted by the husband but the wife withdrew from that concession on 8 July 2022);
(f)The husband does not assert that he changed his position in reliance on the absence of enforcement (presumably by the wife).
Like most cases that come before this Court, the facts are unique. I am not persuaded that the particular factors found to be persuasive in McMillan can be extrapolated to this case.
Conclusion
The final order included a substantive order providing for the husband to retain the business properties. The final order also included time frames for compliance, and default provisions which are the “secondary orders made as a consequence of the substantive order, to give it operation and effect”[11] and, as such, that part of the final order can be varied by way of enforcement.
[11] Ravasani at 907.
I am persuaded that paragraphs 17, 18 and 21 should be enforced. As the time for compliance with paragraphs 17, 18 and 21 has passed, it will be necessary to include a time frame in aid of the enforcement of the obligations created by those provisions. As already indicated, I propose to provide 14 days subject to an indication from the parties that 14 days is not required and that seven is sufficient.
It follows, that the wife’s application for enforcement will be dismissed.
costs
As a consequence of the determination, the husband now seeks an order for costs.
The wife resists any order for costs, submitting that the usual approach should not be departed from; that is that each party should bear their own costs.
Costs in this jurisdiction are generally borne by each party irrespective of the outcome of the dispute.[12] However, the Court has the power to make a costs order if it is of the opinion that there are circumstances that justify it in doing so.[13] The list of matters to which the Court must have regard when determining a costs application so far as relevant are set out in s 117(2A) of the Family Law Act 1975 (Cth) (“FLA”) and since the commencement of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (“the FCFCOA Act”) on 1 September 2021 there are now additional matters to which the Court must have regard.[14]
[12] See s 117(1) FLA.
[13] Section 117(2) FLA.
[14] The notation to s 117(2) FLA refers to s 69(4)(d) and (e) of the FCFCOA Act.
The matters relied upon by the husband in support of his application for costs include the following:
(a)That the financial circumstances of the parties do not preclude an order being made;
(b)That the conduct of the wife in certain respects in relation to these proceedings are relevant as identified by him during submissions;
(c)That the application was necessary because of a failure to comply with an order by the husband;
(d)That the wife has been wholly unsuccessful; and
(e)The failure by the wife to adhere to the ‘overarching purpose’ provisions.
When considering the factors set out in s 117(2A) of the FLA, it is sufficient for one factor to be present.[15]
[15] Fitzgerald vFish; sub nom PBF v TRF (FLR) (2005) 191 FLR 294 at 301, [41].
An additional mandatory requirement is created by s 68(4) of the FCFCOA Act which is in the following terms:
(4)In exercising the discretion to award costs in a civil proceeding, the Federal Circuit and Family Court of Australia (Division 1) or a Judge must take account of any failure to comply with the duty imposed by subsection (1) or (2).
The duty imposed by ss 68(1) and (2) of the FCFCOA Act is in the following terms:
(1) The parties to a civil proceeding before the Federal Circuit and Family Court of Australia (Division 1) must conduct the proceeding (including negotiations for settlement of the dispute to which the proceeding relates) in a way that is consistent with the overarching purpose.
(2) A party’s lawyer must, in the conduct of a civil proceeding before the Federal Circuit and Family Court of Australia (Division 1) (including negotiations for settlement) on the party’s behalf:
(a) take account of the duty imposed on the party by subsection (1); and
(b) assist the party to comply with the duty.
The “overarching purpose”, is set out in s 67 of the FCFCOA Act in the following terms:
Overarching purpose of family law practice and procedure provisions
(1)The overarching purpose of the family law practice and procedure provisions is to facilitate the just resolution of disputes:
(a)according to law; and
(b)as quickly, inexpensively and efficiently as possible.
Note 1: See also paragraphs 5(a) and (b).
Note 2: The Federal Circuit and Family Court of Australia (Division 1) must give effect to principles in the Family Law Act 1975 when exercising jurisdiction in relation to proceedings under that Act.
(2)Without limiting subsection (1), the overarching purpose includes the following objectives:
(a)the just determination of all proceedings before the Federal Circuit and Family Court of Australia (Division 1);
(b)the efficient use of the judicial and administrative resources available for the purposes of the Court;
(c)the efficient disposal of the Court’s overall caseload;
(d)the disposal of all proceedings in a timely manner;
(e)the resolution of disputes at a cost that is proportionate to the importance and complexity of the matters in dispute.
(3)The family law practice and procedure provisions must be interpreted and applied, and any power conferred or duty imposed by them (including the power to make Rules of Court) must be exercised or carried out, in the way that best promotes the overarching purpose.
(4)The family law practice and procedure provisions are the following, so far as they apply in relation to civil proceedings:
(a)the Rules of Court;
(b)any other provision made by or under this Act, or any other Act, with respect to the practice and procedure of the Federal Circuit and Family Court of Australia (Division 1).
Part 12.6 of the FCFCOA Rules deals with the ‘calculation of costs’ and provides as follows:
12.17 Method of calculation of costs
(1)The court may order that a party is entitled to costs:
(a)of a specific amount; or
(b)as assessed on a particular basis (for example, party and party, solicitor and client or indemnity); or
(c)to be calculated in accordance with the method stated in the order; or
(d)for part of the proceeding, or part of an amount, assessed in accordance with Schedule 3.
(2)If costs are payable under the Family Law Act or these Rules, or the court orders that costs be paid and does not specify the method for their calculation, the costs are to be assessed on a party and party basis.
(3)In making an order under subrule (1), the court may consider the following:
(a)the importance, complexity or difficulty of the issues;
(b)the reasonableness of each party’s behaviour in the proceeding including by having regard to the matters set out in subrule 12.08(2);
(c)the rates ordinarily payable to lawyers in comparable proceedings;
(d)whether a lawyer’s conduct has been improper, unfair, unreasonable or disproportionate;
(e)the time properly spent on the proceeding, or in complying with pre‑action procedures;
(f)whether expenses (paid or payable) are fair, reasonable and proportionate.
Rule 12.08(2) (referred to in r 12.17(3)(b)) provides as follows:
(2)In considering whether a party’s legal costs have been fairly, reasonably and proportionately incurred, regard must be had to all relevant matters including, but not limited to, whether a lawyer representing the party, a lawyer representing any other party, or any self‑represented litigant has:
(a)complied with all relevant rules and orders of the court, including requirements that documents be filed or provided to other parties by a given date; and
(b)acted reasonably in raising, pursuing or contesting a particular allegation or issue; and
(c)made reasonable efforts, subject to the client’s instructions, to resolve the dispute through negotiation, mediation or arbitration; and
(d)made reasonable efforts to narrow the issues in dispute; and
(e)filed no more interlocutory applications than are reasonably necessary in the circumstances of the proceeding; and
(f)filed no more affidavits or other documents than are reasonably necessary in the circumstances of the proceeding.
filed no more affidavits or other documents than are reasonably necessary in the circumstances of the proceeding
When determining an application for costs, the Court may make such order as to costs as it considers just.[16] An applicant for costs bears no “additional or special onus” other than the establishment of “justifying circumstances”.[17]
[16] s 117(2) FLA.
[17] Penfold v Penfold (1980) 144 CLR 311 at 315 (“Penfold”).
Not only does this Court have the power to order a specific amount for costs,[18] it has for some time been the policy of this Court to order a specific amount, where possible, rather than requiring an assessment of costs.[19] This is because the latter approach will inevitably involve the parties in yet further conflict, delay, and cost.[20]
[18] See r 12.17(1)(a) of the new Rules.
[19] Stopford Malloy & Malloy (Costs) [2018] FamCAFC 6, [10]–[12] (“Stopford”).
[20] Ibid at [10]-[12].
The husband seeks costs calculated on a party and party basis but for a fixed amount. It is conceded that there are no circumstances which are exceptional in this case such as to warrant indemnity costs.
I have before me an itemised schedule of the husband’s costs of and incidental to the applications which I will mark as exhibit 1. Unfortunately, the schedule of costs prepared are on an indemnity basis or alternatively on a solicitor and client basis on the scale, but not on a party and party basis. The calculation of costs on scale on a solicitor and client basis are approximately $23,000. It is submitted on behalf of the husband that an appropriate discount to reflect party and party costs would be fifty percent.
If costs are to be awarded, the wife does not cavil with that discount but suggests there are a number of further matters in this particular case which would warrant consideration, including:
(1)That the extension of time required by the husband to comply with his obligations meant that he had to come back to court in any event; and
(2)That there has been delay on both sides and that some criticism of each party is warranted.
In my view, this is a case in which a costs order should be made. The wife has been wholly unsuccessful. However, I do not propose to order the fixed sum sought by the husband. In my view, an appropriate discount taking into account the various relevant matters in this case lead me to determine that costs should be awarded in a fixed sum of $5,500 and I so order.
I certify that the preceding sixty-eight (68) numbered paragraphs are a true copy of the Ex Tempore Reasons for Judgment of the Honourable Justice Carew. Associate:
Dated: 22 July 2022
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