Suriz and Bidal

[2017] FamCA 1064

FAMILY COURT OF AUSTRALIA

SURIZ & BIDAL [2017] FamCA 1064

FAMILY LAW – COSTS – APPLICATION FOR REVIEW OF REGISTRAR’S ORDER – Where consideration of relevant facts – Where consideration of applicable principles – Where application for costs dismissed.

Family Law Act 1975 (Cth) ss 117

Collins and Collins (1985) FLC 91-603
Greedy and Greedy (1982) FLC 91-250
Hawkins & Roe [2012] FamCAFC 77
Luadaka v Luadaka (1998) FLC 92-830
Penfold v Penfold (1980) 144 CLR 311

APPLICANT: Mr Suriz

RESPONDENT: Ms Bidal

FILE NUMBER: PAC 5647 of 2016

DATE DELIVERED: 20 December 2017

PLACE DELIVERED: Parramatta

PLACE HEARD: Parramatta

JUDGMENT OF: Foster J

HEARING DATE: By way of written submissions last received on 7 December 2017

REPRESENTATION

COUNSEL FOR THE APPLICANT: Ms Druitt

SOLICITOR FOR THE APPLICANT: Marsdens Law Group

COUNSEL FOR THE RESPONDENT: Mr Fantin

SOLICITOR FOR THE RESPONDENT: Pannu Lawyers

Orders

1. That the wife’s application for costs of and incidental to appearances before the Registrar be dismissed.

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 Suriz & Bidal 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).

FAMILY COURT OF AUSTRALIA AT PARRAMATTA

FILE NUMBER: PAC 5647  of 2016

Mr Suriz

Applicant

And

Ms Bidal

Respondent

REASONS FOR JUDGMENT

1. The application for determination is the respondent husband’s Application in a Case filed 12 September 2017 for review of certain orders made by a Registrar on 14 July 2017 and 5 September 2017. This application is a hearing de novo.

2. The primary proceedings relate to the question of property adjustment as between the applicant wife and respondent husband. The applicant wife seeks orders in her Initiating Application filed 30 November 2016 that provide for:

   a)the sale of the matrimonial properties at Suburb B, Suburb C and Suburb D and that certain joint bank accounts operated by the parties be closed;

   b)the proceeds of sale of the properties and of the bank accounts be divided as to 75 per cent to the wife and 25 per cent to the husband;

   c)the various corporate entities in which the husband has interests be valued and that the husband pay to the wife 75 per cent of the value of the husband’s interest in the said entities.

3. The respondent husband filed a Response to the wife’s Initiating Application on 8 March 2017. In that Response he sought property orders that in summary provide:

   a)that he pay to the wife a sum equivalent to 55 per cent of the net matrimonial asset pool;

   b)that on payment to the wife she transfer to the husband her interest in the Suburb B property with the husband to concurrently refinance the mortgage presently secured against that property;

   c)that the wife be declared the sole and beneficial owner of the other matrimonial properties at Suburb C and Suburb D;

   d)that the parties joint account at the Westpac Bank (..43) be closed and that the balance be paid to the husband;

   e)that the wife transfer to the husband her interest and shareholding in E Pty Ltd;

   f)that otherwise the husband be declared the legal and beneficial owner of various other corporate entities.

4. The proceedings were listed for the purposes of a case assessment conference on 13 March 2017. On that day the Registrar noted that the valuation of certain property of the parties needed to be undertaken. The Registrar ordered that the parties instruct a joint expert to value “the properties and to value such corporate interest as are required by the parties or either of them”. Otherwise, the parties were directed to file a balance sheet by 10 May 2017 with proceedings adjourned to 11 May 2017 as to any outstanding valuation issues.

5. On 11 May 2017 the parties appeared by phone before a Registrar. The Registrar made certain notations as to outstanding valuation issues and otherwise ordered:

   a)that the husband by 1 June 2017 provide to the wife’s legal representatives certain documents by way of financial disclosure.

   b)that by 19 May 2017 the wife nominate one of the husband’s joint experts to undertake the valuation of the “business entity” and in the event that the wife seeks to nominate alternate valuers then she nominate 3 alternate experts by 1 June 2017 and the husband shall “reply by the 8 June 2017”.

   c)that proceedings be otherwise adjourned to 14 July 2017 before the registrar to consider whether the matter could proceed to a conciliation conference.

The costs order

1. On 14 July 2017 proceedings were yet again listed before a Registrar who noted that the husband had not complied with his disclosure obligations as ordered on 11 May 2017 and that the husband had failed to respond to a request to settle a joint letter of instruction to the expert. The Registrar ordered that proceedings be further adjourned to 5 September 2017 and that the husband pay the wife’s costs of 14 July 2017 with an itemised bill of costs to be prepared and the quantum of such costs to be determined on 5 September 2017.

Thereafter

1. On 5 September 2017 the wife provided a bill of costs totalling $2,994.00 that appears related to both 11 May and 14 July 2017.

2. The husband asserted before the Registrar that there were difficulties in relation to valuation of the family business and that valuation had still not been done. Proceedings were adjourned to 13 September 2017 for the purposes of settling a letter to be forwarded to the joint expert. As to costs, the Registrar “approved” the bill of costs rendered with certain amendments that apparently reduced the amount of cost to $1,519.85.

3. It appears that the question of the letter of instruction to the joint expert was subsequently resolved on 31 October 2017 and a draft letter of instruction was approved by the Registrar with either party having leave to relist on short notice. Proceedings were further adjourned to 1 November 2017 as to the issue of business ledgers being made available to the wife’s accountant.

4. On 1 November 2017 the matter was again before a Registrar and there was agreement for certain documents as to the business being made available to the wife’s accountant. The Registrar ordered that the husband provide to the wife and her accountant certain business records for inspection relating to two of the corporate entities operated by him and that the wife nominate a date on which she would attend on the husband to inspect the documents. Proceedings were adjourned to 5 December 2017.

The review

1. On 12 September 2017 the husband filed an Application in a Case seeking a review of the costs order made by the Registrar on 14 July 2017 and a review of the Registrar’s “assessment” of costs made on 5 September 2017. In substance, he seeks that those orders be set aside.

2. The husband in support of his application for review relied on his affidavit filed 5 September 2017. The husband notes the terms of the orders made 11 May 2017 by the Registrar and asserts that he provided by way of disclosure to the wife’s solicitors certain corporate documents in early November 2016. Subsequently on 17 May 2017, 5 June 2017, 9 June 2017, 19 July 2017, 8 August 2017 and 22 August 2017 supplementary documents by way of financial disclosure were provided to the wife’s legal representatives.

3. However, the Registrar’s costs order only goes to circumstances as at 14 July 2017.

4. On 12 November 2017 the wife filed a Response to the husband’s Application in a Case seeking that the Application in a Case be dismissed.

5. The wife relied upon her affidavit filed 12 November 2017 and the affidavit of her solicitor filed 21 November 2017.

6. The wife asserts that on 1 June 2017 she instructed her solicitors to forward correspondence to the husband’s solicitors nominating three valuers for the purposes of the single expert valuation. On 2 June 2017 the wife caused her solicitors to correspond with the husband’s solicitors requesting documents required be provided by the husband by no later than 1 June 2017.

7. Regrettably the correspondence from the wife’s solicitors to the husband’s solicitors does not specify with any particularity what documents in the categories ordered by the Registrar on 11 May 2017 were outstanding. This issue has some significance having regard to the husband’s evidence as to the raft of documents provided by him in November 2016 and June 2017 prior to the costs order made on 14 July 2017.

8. In her affidavit filed 12 November 2017 the wife takes no issue with any of the matters raised by the husband in his affidavit. Correspondence attached to the affidavit by the wife’s solicitor throws no further light on the issue.

Costs

1. Section 117 of the Family Law Act 1975 (Cth) (“the Act”) provides that each party to the proceedings shall bear his or her own costs.

2. That principle is, however, subject to the discretion afforded to the trial judge in subparagraph (2), which provides that if the Court is of the opinion that there are circumstances that justify it in doing so, the Court may, subject to further subsections thereof and the applicable Rules of the Court, make such order as to costs as the Court considers just.

3. Although s 117(2) requires a finding of justifiable circumstances as an essential preliminary to making an order for costs, there is no additional or special onus on an applicant who seeks an order for costs: Penfold v Penfold (1980) 144 CLR 311.

4. The matters relevant to determining what order, if any, should be made for costs are set out in subsection (2A) of that section. They relevantly, in these proceedings, relate to the following:

   a)the financial circumstances of each of the parties to the proceedings;

   b)whether any party has legal aid and the terms of any grant of aid;

   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 answers, 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.

5. In Collins and Collins (1985) FLC 91-603 (at 79,877), the Full Court described the discretion conferred by s 117 as being a “broad” one and held that the factors set out in s 117(2A) are not to be read in a restrictive way.

6. In Greedy and Greedy (1982) FLC 91-250 and Luadaka v Luadaka (1998) FLC 92-830, the Full Court made clear that it is unnecessary to spell out detailed reasons for decisions in costs matters.

7. Later the Full Court in Hawkins & Roe [2012] FamCAFC 77 said:

   17. With respect to the application of the section, in Penfold and Penfold (1980) 144 CLR 311, the High Court said at 315 and 316:

   Sub-section (2) requires a finding of justifying circumstances as an essential preliminary to the making of an order. Beyond this there is nothing in the subject matter or in the interrelationship of the two provisions which imposes any additional or special onus on an applicant for an order for costs. Consequently, with respect to their Honours in the Family Court, we do not agree with the suggestion made in the judgment under appeal that an order can only be made under s. 117 (2) in "a clear case".

   Sub-section (2) does not in our view as a matter of law require the judge to specify the circumstances which justify the making of an order. It does not expressly say so, and in the context of the making of an order for costs there is no sufficient basis for making an implication. Judges very frequently make orders for costs without giving reasons or making findings, even when costs are in issue. The absence of reasons or findings does not in itself indicate that a judge has erroneously exercised his discretion to award costs, though it will place an appellate court in the position of examining the circumstances and of determining for itself whether the circumstances show that the discretion was erroneously exercised (Kent v Kent). Accordingly, in the absence of some positive legislative indication we should not attribute to Parliament the requirement that a judge must make particular findings in relation to an order for costs.

   (footnotes omitted)

   18. The weight to be given to a particular consideration under s 117(2A) is a matter for the discretion of the judge. However, in I and I (No 2) (1995) FLC 92-625 the Full Court of this Court held that the relevant matters in s 117(2A) “must all be taken into account and all balanced in order to determine whether the overall circumstances justify the making of an order for costs”. That is not to say that one single matter may not ultimately be determinative. The Full Court confirmed this in Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Another (2005) 33 Fam LR 123 at paragraph 41:

   … A number of factors are then listed in the subparagraphs. The financial circumstances of each of the parties to the proceedings is the first mentioned factor. Nowhere in subs (2A) or elsewhere in s 117, is there any prescription that more than one factor must be present before an order for costs is made nor of comparative weight of the factors set out in subs (2A). As a consequence, there is nothing to prevent any factor being the sole foundation for an order for costs.

8. The wife contends that the husband should be ordered to pay costs of and incidental to the listing on 14 July 2017 by reason of his outstanding disclosure and issues as to the letter of instruction to the proposed joint expert.

9. As to the disclosure issue she provides no evidence contrary to the significant disclosure as asserted by the husband, nor any evidence as to what was outstanding in relation to the orders of 11 May 2017.

10. Otherwise, the letter of instruction issue was subject to a liberty to relist order as to any ongoing dispute.

11. The husband rightly contends that there was no evidence before the Registrar as to the “non-disclosure” alleged by the wife.

12. The issue as to costs is to be determined by reason of circumstances that existed as at the date of the order for costs, that is 14 July 2017.

13. Having regard to the factors to be considered above particularly s 117(2A)(c) and (d) there is no circumstance that would justify an order for costs.

14. The wife’s application for costs is dismissed.

15. Orders will be made accordingly.

I certify that the preceding thirty-three (33) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Foster delivered on 20 December 2017.

Associate

Date:  20 December 2017