Surve and Surve
[2016] FamCAFC 173
•2 September 2016
FAMILY COURT OF AUSTRALIA
| SURVE & SURVE | [2016] FamCAFC 173 |
| FAMILY LAW – APPEAL –COSTS – Where the husband filed a notice of appeal – Where the wife’s solicitors advised the husband he should obtain legal advice and that there were no arguable grounds of appeal – Where the wife’s solicitors warned the husband that a costs order may be made against him – Where a number of extensions of time were granted to the husband to comply with procedural directions – Where the wife incurred costs meeting the appeal – Where the husband discontinued the appeal – Where the wife sought costs on an indemnity basis – Where the wife satisfied a number of factors of s 177(2A) of the Family Law Act 1975 (Cth) which justified a costs order in her favour – Where costs is not appropriate on an indemnity basis but the amount sought and reference to the costs agreements demonstrate the wife’s sum was reasonable and within the realm of the Family Law Scale – Husband should pay the wife’s costs. |
| Family Law Act 1975 (Cth) s 117 |
| Bant & Clayton (Costs) [2016] FamCAFC 35 Colgate Palmolive Co and Another v Cussons Pty Ltd (1993) 118 ALR 248 |
Fennessy & Gregorian (2009) FLC 93-399
| APPELLANT: | Ms Surve |
| RESPONDENT: | Mr Surve |
| FILE NUMBER: | BRC | 921 | of | 2015 |
| APPEAL NUMBER: | NA | 77 | of | 2015 |
| DATE DELIVERED: | 2 September 2016 |
| PLACE DELIVERED: | Brisbane |
| PLACE HEARD: | Brisbane |
| JUDGMENT OF: | May J |
| HEARING DATE: | 1 September 2016 |
| LOWER COURT JURISDICTION: | Federal Circuit Court of Austalia |
| LOWER COURT JUDGMENT DATE: | 8 October 2015 |
| LOWER COURT MNC: | [2015] FCCA 2733 |
REPRESENTATION
| COUNSEL FOR THE APPLICANT: | Ms Swart |
| SOLICITOR FOR THE APPELLANT: | Thomson Family Lawyers |
| THE RESPONDENT: | Mr Surve (in person) |
Orders
The husband pay to the wife the sum of $10,000.00 in relation to the costs of appeal NA77 of 2015. Such sum to be paid within thirty days of today.
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 Surve & Surve 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).
| IN THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT BRISBANE |
Appeal Number:
File Number:
| Ms Surve |
Applicant
And
| Mr Surve |
Respondent
REASONS FOR JUDGMENT
Introduction
By way of an Application in an Appeal filed 13 June 2016 Ms Surve (“the wife”) seeks that Mr Surve (“the husband”) pay her costs on an indemnity basis, fixed in the sum of $10,631.50.
The wife seeks her costs as a result of the husband discontinuing his appeal which was filed on 29 February 2016 and discontinued on 17 May 2016.
Background
The parties appeared before Judge Baumann on 15 and 16 June 2015 for a parenting and property trial. His Honour indicated the outcome of the hearing, but invited the parties to make submissions on the form of the final orders.
The Notice of Appeal was first filed on 30 October 2015 from the order made on 8 October 2015. The orders related to parenting issues between the parties, in particular that the children live with the mother and that the father may spend time with them in Western Australia and during holidays in Queensland, subject to some conditions.
In relation to the property of the parties it was ordered that the husband pay the wife the sum of $45,500 failing such payment that a property at South-East Queensland be sold. Provision was made for each party to retain various items of property, including bank accounts and superannuation. A superannuation splitting order was made providing the wife with a substantial portion of the husband’s superannuation.
It is of interest in these costs proceedings that the husband claims he was unfairly treated in the trial, especially as he was an unrepresented litigant. The first paragraphs of the reasons delivered on 8 October 2015 are instructive:
1.On 10 July 2015, the Court delivered reasons in this matter arising from a trial concluded on 15 /16 June 2015, relating to both relocation, parenting and property proceedings.
2.Perfecting final orders which reflect the reasons of the Court have been delayed, so as to ensure that the unrepresented husband/father has a fair opportuning to be heard.
3.On 23 July 2015 a very ineffective telephone mention occurred, shaped to a large degree by the fact that:
a)The father is unrepresented; is a fly in fly out worker travelling from Queensland to Western Australia on an at least fortnightly basis.
b)He has found it hard to comprehend the reasons and although English is not his first language, his grasp of legal concepts is only basic.
c)The solicitors for the wife are a Perth, Western Australian firm who generally had independent Counsel from the Victorian Bar appearing, Ms Swart.
4.I have now fully considered:
a)Email from the solicitors for the wife dated 23 July 2015 referring to superannuation splitting orders and attaching draft parenting orders. The father had not read these when the Court called the matter on 10 July 2015.
b)Subsequently, the father by two emails dated 27 July 2015, gave his response. To some degree the father sought to “re-agitate” matters dealt with at the hearing and sought the Court, give the mother “a warning” about consequences that flow from a failure to comply with the order as to her misuse of alcohol.
The reasons for the orders, being delivered on 10 July 2015 are comprehensive. The parties have little net property as found by the trial judge. They each have superannuation; the wife’s valued at $4,000 and the husband’s at $151,694. Otherwise the husband owned a house valued at $360,000 with a mortgage of $294,784. The judge found the net value of their assets (excluding superannuation) was $82,416. It was ordered that the husband pay to the wife 35 per cent of the net pool, the sum of $45,500. As to the super, the wife is to retain 65 per cent of the superannuation, a sum of $97,000.
The amended Notice of Appeal filed 29 February 2016 sought to appeal only the property orders including the superannuation split. In the original Notice of Appeal the husband had also sought to appeal the parenting orders.
The wife’s application for costs
In the Affidavit filed 13 June 2016 the background to the appeal and the actions that the solicitors for the wife had taken subsequently to the filing of the Notice of Appeal is explained:
6.On 20 November 2015, my then solicitors corresponded with [the husband] and informed him of their view that there were no arguable grounds for his Appeal and that his Notice of Appeal failed to properly identify any such grounds. They urged [the husband] to obtain independent legal advice and cautioned him on the very real possibility that a Costs Order may be made against him, if he pursued the Appeal. …
7.On 16 December 2015, my then solicitors again corresponded with [the husband], reminding him once again that they saw no arguable grounds of Appeal and that costs would be sought against him, if he pursued the Appeal. My solicitors again urged [the husband] to see independent legal advice. …
There were a number of procedural hearings and orders made including that the husband file an Amended Notice of Appeal. He failed to do that by the time required in the orders, being 8 February 2016.
Various extensions of time were granted within the course of the appeal to allow the husband to comply with directions including the filing of appeal books.
In relation to the application for indemnity costs the wife attached the Costs Agreement to her affidavit. The wife had two solicitors representing her – the bill from the Perth Family Lawyers is $5,390 and Thomson Family Lawyers is $2,200. There are further costs estimated to be $1,281.50 yet unbilled.
The written costs submissions will involve a further bill in the sum of $1,760. The costs in the sum of $10,631.50 are claimed on an indemnity basis. At the hearing of this application counsel for the wife asked to add a further $3,820 being the costs of the appearance.
The wife’s current financial circumstances are as follows:
·The wife is in receipt of Centrelink benefits of $637.00 per week;
·Due to health issues the wife has not been able to work;
·The wife’s mother subsidises her rent by providing her $100.00 per week;
·The wife is financially responsible for the support of four children including two children of the husband;
·The husband is assessed to pay around $47.00 per month in Child Support to the wife.
In the written submissions filed on behalf of the wife on 12 August 2016 the following relevant matters are relied on by reference to s 117(2A)(a) of the Family Law Act 1975 (Cth) (“the Act”):
6.The Applicant deposes that she is in receipt of a Centrelink Benefit of $637 pw [Para 35, CMS 13/6/16] and that child support payments is $9,000 in arrears with a current assessment of $47pm for the parties' 2 children [Para43-44, CMS 13/6/16]. She has not yet and may not ever receive the $45,500 due to her under the orders of the Federal Circuit Court as the Respondent has defaulted on the mortgage of the former matrimonial home and the mortgagee has taken possession for sale. [Para 47, Annexure K, CMS 13/6/16].
7.The Respondent has filed an incomplete Financial Statement but it appears that he resigned his employment. It is not clear what interest if any he has in the former matrimonial home as its sale price has not yet been determined.
8.Each party has modest superannuation, which was split pursuant to the Federal Circuit Court Orders. The husband is 54 years of age and will have access to $54,000 of superannuation soon if he remains out of the full-time workforce.
9.The Applicant's circumstances are such that she cannot afford to bear her own costs of the Appeal.
…
s117[2A](c) Conduct of the parties
13.Even given the allowances made for a self-represented litigant, the Respondent's conduct of the proceedings in the Appeal was such that a costs order should be made against him. He was advised at an early stage to seek advice with respect to the merits of his appeal. He continued to prepare the appeal, putting the Applicant to the added cost of considering his applications to extend time-limits on 2 occasions. His redrafted Grounds of Appeal were again without the benefit of legal advice. Then, having put the Respondent to considerable expense compared to her circumstances, he discontinued the appeal, stating that he could not afford the transcript. [Para 8, Affidavit of [Mr Surve] filed 28 July 2016].
s117[2A](e) Party wholly unsuccessful
14.By reason of his discontinuance, the Respondent was wholly unsuccessful in his Appeal.
s 117[2A](f) Offer in writing
15.The Applicant offered to allow the Respondent to discontinue the Appeal without cost in her solicitor's first letter after service of the Notice of Appeal. [Annexure A, CMS 13/6/16].
As to whether indemnity costs should be ordered it is submitted:
16.This is a case where consideration of a departure from the ordinary rule that costs be awarded on a party/party basis is warranted as the circumstances may be considered exceptional (Kohan and Kohan (1993) FLC 92·340 at p 79,614)
17.It is submitted that the matter falls within (a) and (e) of the examples of Holden CJ in Munday v Bowman 1997 FLC 92-784 at p 84,660 -
"(a) Where it appears that an action has been commenced or continued in circumstances where a party properly advised should have known that he had no chance of success. In such cases the action must be presumed to have been commenced or continued for some ulterior motive or because of some wilful disregard of the known facts ...
and
(e) An imprudent refusal of an offer to compromise"
18.If the Respondent had been properly advised (or advised at all) he should have known that his Grounds of Appeal had no prospect of success. He was invited to obtain legal advice. He was given the opportunity to redraw the Grounds. He failed to identify arguable grounds of appeal because he had none. After discontinuing his application for a stay of the children's orders, he then withdrew his appeal with respect to the children's orders. The Superannuation had already been transferred and the only reasonable conclusion is that, like the husband in the case of Belle & Vaughan (Costs) [2012) FamCAFC 198, the Respondent did not wish to comply with the property orders.
19.Having filed an Appeal with no arguable Grounds, it was clearly imprudent of the Respondent to decline the Applicant's offer at an early stage that he withdraw without costs before an appearance at the directions hearing was required.
20.The Applicant's costs sought are a modest $10,631.50 in accordance with the costs agreements and accounts from her solicitors [Annexures F-J, CMS 13/6/16].
It seems correct that the South-East Queensland home will produce little, if any, net proceeds. As counsel for the wife said, the situation for the parties is “chaotic” and although there are no immediate prospects of the husband paying the costs the order is sought for the reasons explained.
The husband provided very few reasons as to why an order for costs should not be made apart from continuing to assert in his written submissions that he had an arguable case.
Conclusion
It is clear from the provisions of s 117 that subject to the court concluding that there are circumstances to justify an order for costs, each party should bear their own costs. The relevant circumstances were contained in the submissions of the wife to which I have referred. There is no doubt that an order for costs should be made.
Consideration in relation to costs on an indemnity basis include different criteria, most particularly that there is something exceptional about the circumstances (Colgate Palmolive Co and Another v Cussons Pty Ltd (1993) 118 ALR 248 per Sheppard J at 256-257). Again, these have been properly identified in counsel for the wife’s submissions.
In addition to maintaining he had an arguable case, the husband resisted a costs order on the basis that he had no choice but to discontinue the appeal, or it would have otherwise been deemed abandoned because he was unable to comply with the procedural directions.
As previously noted, the quantum of costs sought by the wife on an indemnity basis is fixed in the sum of $10,631.50. Reference to the costs agreements the mother had with each of her solicitors demonstrates that fees were charged within the realm of the rates set out in the Family Law Scale, which is contained in Schedule 3 to the Family Law Rules 2004 (Cth). The costs sought are relatively modest.
Although costs are not usually ordered on an indemnity basis where an appeal has been abandoned (Fennessy & Gregorian (2009) FLC 93-399), and indemnity costs are rarely ordered where appeals have been discontinued (Bant & Clayton (Costs) [2016] FamCAFC 35), it is clear that in these circumstances a fixed costs order should be made. The sum sought by the wife was $10,631.50 together with a further $3,820. Although it was necessary for counsel to appear to ask for costs, taking into account the husband’s relatively poor circumstances an order in the sum of $10,000 is appropriate.
I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Justice May delivered on 2 September 2016.
Associate:
Date: 2 September 2016
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