Stopford Malloy & Malloy (Costs)
[2018] FamCAFC 6
•22 January 2018
FAMILY COURT OF AUSTRALIA
| STOPFORD MALLOY & MALLOY AND ANOR (COSTS) | [2018] FamCAFC 6 |
| FAMILY LAW – APPEAL – COSTS – Where the wife seeks costs – Where the respondents acknowledge that they have been wholly unsuccessful with respect to their applications and that they are in a superior financial position to the wife – Where the respondents challenge the quantum of the costs sought – Where there are items which are unreasonable – Where the respondents oppose an order being made certifying the matter fit for both senior and junior counsel – Where the fact that the matter was one of practice and procedure and the applications were determined by way of written submissions does not say anything about the complexity of the same – Where an order fixing costs should be made – Costs ordered in favour of the wife in the sum of $25,500 – Matter certified fit for senior and junior counsel. |
| Family Law Act 1975 (Cth) s 117 |
| Family Law Rules 2004 (Cth) r 19.18(1)(a) Beach Petroleum NL v Johnson (1995) 135 ALR 160 |
| APPLICANT: | Ms Stopford Malloy |
| RESPONDENTS: | Mr Q Malloy and The Malloy Group |
| FILE NUMBER: | ADC | 2595 | of | 2015 |
| APPEAL NUMBER: | SOA | 15 | of | 2017 |
| DATE DELIVERED: | 22 January 2018 |
| PLACE DELIVERED: | Adelaide |
| PLACE HEARD: | In Chambers |
| DATE HEARD: | In Chambers by way of written submissions |
| JUDGMENT OF: | Thackray, Strickland and Murphy JJ |
| LOWER COURT JURISDICTION: | Family Court of Australia |
| LOWER COURT JUDGMENT DATE: | 7 February 2017 |
| LOWER COURT MNC: | [2017] FamCA 116 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: SOLICITOR FOR THE APPLICANT: | Mr Wells QC with Mr McGinn Piper Alderman Lawyers |
| SOLICITOR FOR THE RESPONDENTS: | Barnes Brinsley Shaw Lawyers |
Orders
The respondents pay the applicant wife’s costs fixed in the sum of $25,500, such amount to be paid within 28 days of the date hereof.
Certify fit for senior and junior counsel.
Note: The form of the order is subject to the entry of the order in the Court’s records.
IT IS NOTED that publication of this judgment by this Court under the pseudonym Stopford Malloy & Malloy and Anor (Costs) has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).
Note: This copy of the Court’s Reasons for Judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.02A(b) of the Family Law Rules 2004 (Cth)), or to record a variation to the order pursuant to r 17.02 Family Law Rules 2004 (Cth).
| THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT ADELAIDE |
Appeal Number: SOA 15 of 2017
File Number: ADC 2595 of 2015
| Ms Stopford Malloy |
Applicant
And
| Mr Q Malloy and The Malloy Group |
Respondents
REASONS FOR JUDGMENT
Introduction
On 5 October 2017 this Court made orders dismissing an application for leave to appeal and an application in an appeal filed by Mr Q Malloy and the Malloy Group (“the respondents”).
On 2 November 2017 Ms Stopford Malloy (“the wife”) filed an application in an appeal seeking an order for costs against the respondents. The application was supported by an affidavit of the wife filed on the same date.
On 16 November 2017 this Court made orders providing for the parties to file written submissions in relation to the application for costs, and for that application to be determined in chambers.
Each of the parties has now filed their written submissions.
The wife seeks costs of $47,341.22 comprising solicitor’s costs of $28,305.77, and counsel fees of $19,035.45.
The legislation
The question of costs is governed by s 117 of the Family Law Act 1975 (Cth) (“the Act”) which relevantly provides as follows:
(1)Subject to subsection (2), subsection 70NFB(1) and sections 117AA, 117AC and 118, each party to proceedings under this Act shall bear his or her own costs.
(2)If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4), (4A) 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.
(2A)In considering what order (if any) should be made under subsection (2), the court shall have regard to:
(a)the financial circumstances of each of the parties to the proceedings;
(b)whether any party to the proceedings is in receipt of assistance by way of legal aid and, if so, the terms of the grant of that assistance to that party;
(c)the conduct of the parties to the proceedings in relation to the proceedings including, without limiting the generality of the foregoing, the conduct of the parties in relation to pleadings, particulars, discovery, inspection, directions to answer questions, admissions of facts, production of documents and similar matters;
(d)whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court;
(e)whether any party to the proceedings has been wholly unsuccessful in the proceedings;
(f)whether either party to the proceedings has made an offer in writing to the other party to the proceedings to settle the proceedings and the terms of any such offer; and
(g)such other matters as the court considers relevant.
Discussion
The respondents acknowledge that they have been wholly unsuccessful with respect to their applications, and that they are in a superior financial position to the wife. As such they acknowledge that “it would be difficult for them to resist the Court exercising discretion to make an order for costs” in favour of the wife.
We agree with that concession, but go further and find that an order for costs should be made. Plainly the circumstances identified by the respondents themselves justify such an outcome.
However, the respondents challenge the quantum of costs sought by the wife. First, they dispute the itemised costs account provided by the wife’s solicitors, and secondly, they oppose certifying the matter fit for both senior and junior counsel.
In those circumstances, one option for this Court is to make an order for costs but provide for those costs to be assessed in default of agreement. However, it is now the policy of the Appeal Division of this Court to endeavour to fix costs whenever practicable in order, in particular, to save the parties the costs that would be incurred with an assessment, and to relieve our Registrars of the time consuming burden of undertaking an assessment.
Rule 19.18(1)(a) of the Family Law Rules 2004 (Cth) (“the Rules”) provides as follows:
RULE 19.18 METHOD OF CALCULATION OF COSTS
19.18(1) The court may order that a party is entitled to costs:
(a) of a specific amount;
…
As was said in Beach Petroleum NL v Johnson (1995) 135 ALR 160 at 162, the purpose of such a rule is to “avoid the expense, delay and aggravation involved in protracted litigation arising out of taxation”.
Importantly, the process that a court adopts in fixing costs in this way does not entail a process akin to how a taxing officer would undertake the task. As was said in Idoport Pty Ltd v National Australia Bank Ltd [2007] NSWSC 23, the court must act judicially on the information before it, but that does not mean that it must exercise the power to award a lump sum in any “scientific or formulaic manner” (at [10]).
As to the challenges raised by the respondents in relation to the costs of the solicitors, the first would appear to be a general concern whether all of the items claimed relate to the applications before the court. However, there are no specifics provided of that concern, and we will proceed on the basis that all of the items are so related, but of course that says nothing about their reasonableness or their necessity. It is for this Court to consider those matters as best it can.
Secondly, there is a specific complaint of double counting, namely a charge of $3,326.40 for perusing the application books when there are already charges claimed totalling $2,799.62 for perusing individual documents in those books.
The wife has filed written submissions in reply to the submissions filed by the respondents, but this complaint is not addressed. A reasonable inference therefore is that the complaint is accurate, and that would seem to accord with a plain reading of the itemised bill of costs.
Thirdly, it is pointed out that the solicitors are seeking costs totalling $12,893.58 for perusing a book of documents presented to this Court in relation to the application in an appeal filed by the respondents seeking to lead further evidence. However, those documents were also the subject of perusal charges by the wife’s senior counsel and her junior counsel. Importantly, senior counsel’s costs for perusing those documents is $1,414 compared to the solicitor’s costs of $12,893.58 identified above.
In reply to this complaint, the wife says that the solicitors and counsel each have separate and distinct roles to play in order to properly represent her, and it was necessary for each of them to read the subject documents. However, we fail to see how it is necessary for each of the solicitors, senior counsel and junior counsel to do that, and in any event, we are concerned that the solicitor’s costs are approximately nine times those of senior counsel for essentially the same task. In that regard we note that junior counsel’s total charges for all work undertaken, including the perusal of those documents is $4,664.50.
We consider that the costs sought by the solicitors in relation to this item are unreasonable, and indeed, the work undertaken was unnecessary.
Turning to the issue of the certification for senior and junior counsel.
The submissions of the respondents is that only a certificate as to junior counsel is appropriate, on the basis that the “application was not complex”. However, we reject that submission.
We note that in relation to the initial hearing to determine whether the question of leave to appeal should be determined on the papers, the matter was certified fit for senior counsel, and no objection was raised by the respondents as to that certification. Thereafter, we consider that it was appropriate for the written submissions to be prepared by both senior and junior counsel. The fact that the issue was one of practice and procedure, and that the applications were determined by way of written submissions, does not say anything about the complexity of the same. Thus, we propose to certify fit for both senior and junior counsel.
In all the circumstances we consider that the solicitor’s costs should be fixed at $12,500, senior counsel’s fees at $10,000 and junior counsel fees at $3,000, totalling $25,500.
I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Thackray, Strickland & Murphy JJ) delivered on 22 January 2018.
Associate:
Date: 22 January 2018
23
1
0