Thurston & Anor and Loomis & Ors

FAMILY COURT OF AUSTRALIA

THURSTON AND ANOR & LOOMIS AND ORS

[2018] FamCA 597

FAMILY LAW – COSTS – Where various parties filed applications for costs – Where the first respondent relied heavily upon two written offers of settlement – Where both offers were rejected – Where the terms of the two offers of settlement would not have given the late applicant a better outcome than what she received from the final orders – Where neither the first applicant nor first respondent were wholly successful or unsuccessful in the overall proceedings – Where the circumstances do not justify any of the parties receiving any costs order in its favour – Where all extant costs applications are dismissed.

Family Law Act 1975 (Cth)

FIRST APPLICANT:

Ms Thurston

SECOND APPLICANT:

Ms Morris

FIRST RESPONDENT:

Mr Loomis

SECOND RESPONDENT:

L Ltd

THIRD RESPONDENT:

C Pty Ltd

INTERVENER:

Mr Mills

FILE NUMBER:

BRC

1010

2012

DATE DELIVERED:

9 August 2018

PLACE DELIVERED:

Brisbane

PLACE HEARD:

Brisbane

JUDGMENT OF:

Forrest J

HEARING DATE:

31 July 2018

REPRESENTATION

SOLICITOR FOR THE SECOND APPLICANT:

Mr Cassidy

MCW Lawyers

THE FIRST, SECOND AND THIRD RESPONDENTS:

The First Respondent in person

Orders

That all extant Applications for Costs in this matter, 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 Thurston and Anor & Loomis and Ors 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 BRISBANE

FILE NUMBER: BRC 1010 of 2012

Ms Thurston

First Applicant

And

Ms Morris

Second Applicant

And

Mr Loomis

First Respondent

And

L Ltd

Second Respondent

And

C Pty Ltd

Third Respondent

And

Mr Mills

Intervener

REASONS FOR JUDGMENT

On 21 March 2018, I made final property alteration Orders in these proceedings pursuant to s 90SM of the Family Law Act 1975 (“the Act”) and published some short written reasons for those Orders that supplemented far more lengthy written reasons that I had already published on 25 January 2018.
On the same day, I stayed the execution of those Orders and I made procedural directions for the parties to file any costs applications (including in respect of any costs previously “reserved” by me) and contravention and contempt applications that each had long foreshadowed were going to be made.
The Applicant filed a contravention application alleging multiple contraventions of interim orders that had been made throughout the years the matter has been before the Court. She also filed an application seeking that the First Respondent pay her costs in the sum of $84,086.09 in the property alteration proceedings.
The First Respondent filed an application alleging that the Applicant had contemptuously contravened many of the interim orders that had been made throughout the proceedings and seeking to have her punished for that contempt. He also filed an application seeking an order that the Applicant pay his costs of the proceedings on an indemnity basis.
The Second Respondent (the First Respondent’s company) also filed an application seeking an order that the Applicant pay its costs of the proceedings on an indemnity basis.
I listed the applications for mention before me on Tuesday, 31 July 2018.

The Untimely Death of the Applicant

In early July 2018, the Court was informed of the untimely death of the Applicant.
At the commencement of the hearing on 31 July 2018, I made orders permitting the late Applicant’s mother to become a party to the property alteration proceedings as the mother’s personal representative pending a formal Grant of Probate being obtained, after which she will be substituted for the Applicant in the proceedings as her “legal personal representative”. A copy of a 2014 Will purportedly signed by the Applicant making her mother the Executor of her estate on her death was adduced into evidence by the late Applicant’s mother.
The late Applicant’s personal representative (her mother) was represented before me by an experienced solicitor.
Without objection from any party, I determined that the contravention proceedings commenced by the Applicant and the contempt proceedings against the Applicant were concluded by force of the late Applicant’s recent death. I went on to inform the parties that I considered the competing costs applications to remain on foot though, and I invited any further submissions. I gave the First Respondent, at his request, the opportunity to file the bundle of annexures that went with an affidavit that he had filed in response to the late Applicant’s costs application and I heard further oral submissions from him in respect of his costs application. I had already read all of the lengthy affidavits and written submissions that he had filed on his own behalf and on behalf of the Second Respondent. I have now also read all of those annexures that he subsequently filed.
The solicitor who appeared for the late Applicant’s intervening mother informed the Court that no further written or oral submissions would be made on behalf of the late Applicant’s estate in respect of the late Applicant’s costs application and that reliance would simply be placed on the material already filed by her prior to her death.

The Applicable Law

Section 117(1) of the Act provides, relevantly, that subject to subsection (2), each party to proceedings shall bear his or her own costs.
Subsection (2) of s 117, relevantly, gives the Court the discretion, where it is of opinion that there are circumstances that justify it in doing so, subject to subsection (2A), to make such order as to costs as the Court considers just.
Subsection (2A) of s 117 provides a non-exclusive list of matters the Court shall have regard to in considering what order (if any) should be made under subsection (2). Those matters listed are:
(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.

The First Respondent’s Submissions

The First Respondent made it very clear in his written submissions[1] that he relied heavily upon the fact that he had made written offers to settle the proceedings which, he asserted, provided the Applicant with a better outcome (had she accepted them and agreed to orders being made on those terms) than she ultimately obtained from the final property alteration orders. That said, in his oral submissions, he stressed that the written offers and their terms formed only part of his argument as to why the Court would form the opinion that there are circumstances that justify it in making the costs order he seeks.
[1] Mr Loomis filed a first set of written submissions in support of his costs application on 13 July 2018. He filed a second and shorter set of written submissions in support of the application on 3 August 2018. I have carefully read both of those documents.
In addition, his first set of written submissions, which were lengthy and often repetitive, raised the financial circumstances of the parties, the conduct of the late Applicant in relation to the proceedings (including her admitted contravention of orders of the Court, and her lack of credibility as found by the Court) in support of his case that the Court would find that a costs order was justified and that it would be just to order that his costs be paid on an “indemnity” basis.

The Written Offers of Settlement

Prior written offers of settlement and their terms must be considered when an application for costs is being determined. The legislative provision set out above requires that. A clear, readily understood offer of settlement, made in writing early in property alteration proceedings is a signpost of a party’s apparent willingness to resolve a dispute on those terms. Having regard to the provisions of s 117(1), (2) and (2A), a party rejecting or ignoring such a written offer of settlement does so at considerable peril of costs in the event that a court determined final outcome is not clearly as good for that party as the terms of the written offer of settlement provide.
The First Respondent referred to the letter written by his then solicitors, Jones ML, to the late Applicant’s then solicitors, ML Lawyers, on 8 March, 2012 in which an offer to settle was made. I regard it as a genuine expression of a desire on Mr Loomis’s part to attempt to reach a negotiated resolution of the dispute he found himself in with Ms Thurston. Indeed, the letter begins with the sentence “We are instructed to open negotiations in relation to property settlement matters between the parties”.
In that letter, it was said that the Second Respondent company owned real property in the UK and that Mr Loomis was the director of the Second Respondent but that another company was the shareholder. It was said that other company was owned by another company. However, it was also said that “for the purposes of this offer, the property [the real property in the UK] is included”.
Later in the letter, it was said:
[Mr Loomis] borrowed against the United Kingdom property and contributed $460,000 to the construction [of the parties’ … home]. … On our instructions, the original agreement between the parties was that [Mr Loomis] would be repaid the $460,000 plus interest;
At the time that [Mr Loomis] made the contribution to the reconstruction of the home … he borrowed £300,000 against the property … in the United Kingdom. … [A]nd $460,000 was contributed to the … reconstruction [of the home].
…
The costs of the subdivision of [another] block were paid from cash in the self-managed super fund and by an increase of the mortgage secured against the [home] … It seems to us that the parties need specialist advice in relation to their position vis-à-vis that self-managed superannuation fund and their use of its assets.
In the list of property then set out, the letter includes (amongst other things) the Second Respondent company’s interest in the UK property. It also includes the self-managed superannuation fund (“SMSF”) but ascribes a value of “Nil” to it. In the list of liabilities then set out, the letter includes the mortgage secured over the UK property. The letter then proposes that, amongst other things, Mr Loomis retain as his property, free from any claim by the late Applicant “[h]is interest in the property in the UK, subject to the mortgage” (my emphasis).
Mr Loomis submits that the terms of the offer clearly provide for an outcome for the late Applicant better than that which she obtained by my final Orders. At first glance, in terms of the division of cash, property and liabilities that is proposed in the letter accepted at face value, a comparison with that which my final orders provided the late Applicant retain makes Mr Loomis’s submission appear to have some merit. However, having particular regard to the way in which Mr Loomis ran his case for all the years the matter has been before me, and conscious of the decision I made about one particular issue about which Mr Loomis never relented[2], I am not persuaded that the Applicant would have been better off had she accepted the offer contained in that letter and consented to orders in those very terms rather than awaiting my final orders.
[2] He has always maintained that Ms Thurston personally owed L Ltd a large amount of money and that she had to repay it.
Notwithstanding what the letter says about Mr Loomis borrowing against the UK property and contributing (my emphasis) $460,000 to the costs of construction of the BC Town home and there being an agreement between the parties originally that he would be repaid that $460,000, Mr Loomis always argued throughout the proceedings, in an almost all-consuming manner, that the Applicant alone had borrowed that money from the Second Respondent company and must repay it to that company. He also argued that the Second Respondent company was a legal entity distinct from him and that its property should not be held to be his property. Indeed, at one point in time during the proceedings it emerged that the Second Respondent company had commenced proceedings in a UK court seeking to recover a debt of that magnitude from the Applicant.
The terms of the letter of 8 March 2012 and the offer to settle contained in the letter do not make it clear that Mr Loomis actually asserted, and would assert in any proceedings, that the company that owned the UK property was not his “puppet” or “alter ego” and that it was to that company and not to him the sum of $460,000 was owed. Nor do they make it clear that Mr Loomis asserted, and would assert in any proceedings, that it was the Applicant alone who owed the sum of $460,000 to that company rather than to him or rather than the two of them jointly owing it to the company. Importantly, in my judgment, particularly having regard to how he subsequently ran his case, the terms of the offer do not contain a clear and “precise”[3] offer on the part of Mr Loomis to indemnify the Applicant against any liability to the Second Respondent company (or Mr Loomis himself) for the debt he has since then always said is owed by her to that company.
[3] To adopt a word used by Mr Loomis in his second set of written submissions.
There is nothing in the offer that causes me to be satisfied, particularly having the benefit now of knowing exactly how Mr Loomis ran his case over the ensuing years, that had the Applicant entered into an agreement with Mr Loomis in the terms offered in that letter that was then given effect to in final orders made by the Court with the consent of the parties, that the Second Respondent company would not have subsequently pressed the assertion that the Applicant personally owed it $460,000 plus interest thereon and sued her in a UK Court to try and recover that alleged debt, as it, in fact, later did. Contrary to Mr Loomis’s written and oral submissions, no clear indemnity was offered by Mr Loomis in that letter that might have prevented the Second Respondent company from doing that or that might have given the Applicant some protection against such action. Furthermore, I reject his submission that it is somehow clear that had the Applicant settled with him on the precise terms offered in that letter, that the Second Respondent would have subsequently been “estopped” from claiming that the Applicant owed her the money he has always alleged she still owes it.
In the final orders I made, Mr Loomis was ordered to indemnify the Applicant against any liability to the Second Respondent and Third Respondent companies and the UK revenue authorities arising out of their dealings, and Mr Loomis and the two companies are restrained from taking any further steps to recover amounts alleged to be owed by the Applicant. Such orders were determined by me to be totally justified and necessary. Such indemnity and protection against further suit at the hands of the companies was plainly not offered to the Applicant in that letter of March 2012 in any terms, let alone any “precise” terms as Mr Loomis would have the Court accept.
When I raised my preliminary views about that with Mr Loomis at the hearing to give him an opportunity to make submissions in response, he submitted, in essence, that the terms of such indemnity and immunity from suit offered to the Applicant as part of the proposed resolution could be inferred from the terms of the letter or implied from the rest of its content. He went on to submit that they could have been expected to have agreed to those terms in further negotiations. In his second set of written submissions filed on 3 August 2018 he stresses the same points and raises the estoppel argument. With respect, I do not accept those submissions. Clearly, the letter implicitly reserves to Mr Loomis the right to argue that the UK real property is not his but rather the property of a company in which he asserts he has no interest. However, as implicit as that may have been, the letter does not put the Applicant on any notice that in the absence of a resolution she will be held personally liable to that company, as well as the Third Respondent company, for a very large principal sum of money plus interest. The letter does not offer her an indemnity against such asserted liability if she accepts the offer.
Furthermore, the fact that Mr Loomis expressly included a “discharge” of the alleged “indebtedness” of the Applicant and an indemnity for her in respect of alleged debts to the companies in his 2013 written offer of settlement helps persuade me that the absence of express reference to such a discharge of indebtedness or an indemnity in his March 2012 written offer of settlement is critical in the determination of whether or not the actual terms of his written offer of settlement were more favourable to the Applicant than my final orders are.
Ultimately, upon reflection, I am not persuaded that the terms of the written offer of settlement made on Mr Loomis’s behalf in the March 2012 letter are such that they justify the making of a costs order against the Applicant’s estate in this case. I appreciate that his letter of offer and the second written offer he referred me to do demonstrate that he was willing to try to enter into a resolution of the dispute with the Applicant at the earliest stages of this very troubling case, but that in itself is not enough to justify ordering the Applicant’s estate to pay all of his costs of the proceedings on an indemnity basis. In the circumstances of this case, I am of the judgment that precision indeed would be required in determining whether any written offers of settlement offered better outcomes to the late Applicant than the final Orders provide for. I do not accept that the March 2012 offer, precisely considered, offered the late Applicant a clearly better outcome than the final Orders provided for her.
In respect to the precise terms of that second written offer, it is correct that it did include the offer to discharge the alleged indebtedness of the Applicant and to indemnify her against any further liability to the companies and that it also included an offer to accept a payment of $300,000 from the Applicant in return for that discharge and indemnity and a surrender of all claim to any of the property in Australia that was registered in the Applicant’s name. At first blush, too, that compares relatively favourably with the final outcome, save for another clearly critical matter.
After the trial, I determined that the Applicant and the First Respondent had seriously contravened superannuation regulatory law in respect of the conduct of their SMSF. In short, they had inappropriately used all of its significant assets for their own personal benefit and left it in complete disarray in a regulatory sense. Before I embarked upon making final orders, by interim orders, I put a process in place whereby their breaches of the law could be remedied and the superannuation fund again made ‘compliant’ to the satisfaction of the Australian Tax Office. That resulted in all of the remaining cash funds eventually being reinstated as assets of the SMSF with the parties having their full member benefits reinstated. In the process, that left no other cash assets outside the fund.

I am completely satisfied that is how it should have been at the time Mr Loomis made the second written offer of settlement in September 2013. Had their SMSF been compliant at the time of that offer, it is most likely there would not have been the funds for the Applicant to have made a payment of $300,000 to Mr Loomis. I am satisfied that at that time, Mr Loomis and his legal advisers (it was a different set of solicitors by that time) were cognisant of the fact that there were serious problems confronting Mr Loomis and the Applicant in respect of their management of their SMSF. The offer of settlement that was made at that time by Mr Loomis simply ignored that reality. It included the following offer in respect of the SMSF:
That the joint self-managed superannuation fund be dissolved and entitlements of each of the parties shall be transferred to a new superannuation fund as nominated by the Husband and the Wife respectively.
That was, with respect, in my judgment, an offer to effectively sweep the problem under the carpet when both of them were already aware (as demonstrated by the March 2012 letter of offer of settlement) that there were significant problems confronting them about which they would need to take some clear and decisive action upon receipt of professional advice.
It would be, in my respectful judgment, a nonsense to consider that the terms of that September 2013 written offer of settlement offered a better outcome for the Applicant than the final outcome gives her, as it could only be considered as having done so if their continued breach of superannuation regulatory law was tolerated and simply overlooked.
I am simply not persuaded by the First Respondent that either of the two written offers of settlement he has referred the Court to presented the late Applicant with options that, if accepted, would have given her a better outcome than she got from the final Orders.

The Balance of the arguments for a Costs order

Having read and heard all of the First Respondent’s submissions, I consider it fair to summarize the balance of them as containing the complaint and assertion that the Applicant embarked on the litigation with intent to financially and emotionally ruin the First Respondent, to “win at all costs”, and in seeking to achieve those aims she was prepared to, and did, lie, fabricate evidence and fail to disclose other relevant evidence, unfairly extend and delay the proceedings with malicious intent, thereby causing the First Respondent significant and undue expense, that he would not have otherwise had to endure. He asserts that without a compensatory costs order he will be left penniless and destitute.
Mr Loomis has led evidence that his former solicitor in these proceedings asserts he owes him over $200,000. He conceded that some of that expense was incurred in respect of the contested parenting proceedings (for which he is not seeking a costs order from this Court) which were conducted and concluded in the Federal Circuit Court (“FCC”), though he was quick to quantify that at only approximately $30,000. It is a fact that the late Applicant’s estate stands to receive approximately $326,000 in non-superannuation cash upon execution of my final property alteration orders. The estate could also expect to receive a further sum of up to $20,000 being arrears of child support Mr Loomis is now liable to pay pursuant to my child support departure orders. The late Applicant’s Will, a copy of which was adduced in evidence before me by her mother, provides for a debt of $250,000 said to be owed to her mother to be paid to her mother before any residuary is to be held on trust for the parties’ son until he turns 25 years of age.
Clearly then, as things stand, the estate could afford to pay a costs order in the order of the amount that the First Respondent’s costs might ultimately be assessed at, even on an indemnity basis. Of course, that would impact upon, firstly, the late Applicant’s mother’s prospects of recovering the funds she loaned to her daughter to pay her legal costs in the proceeding, and, secondly, the prospect of their being any residuary for the parties’ child when he grows up. On the other hand, the First Respondent, without a costs order, appears to face a very difficult financial position even with the money that he has been ordered to receive by way of the final orders. In short, should his debt to his former solicitor prove to be as it is asserted by the solicitor, the First Respondent will have little, if any, of that money left after discharging that debt.
The First Respondent urges me to take those matters into account. The provisions of the Act require me to, in any event, and I do.
At this point, I consider it worth repeating some things I said in my reasons for judgment about the parties. I was satisfied that in the proceedings they both were providing a “significant degree of selective disclosure rather than fully and completely meeting their obligations in that respect”. I was also satisfied that the “nature of their individual personalities and the toxicity that developed in their relationship truly explains [the] level of disagreement and conflict [that was demonstrated by them throughout the proceedings and at the trial]”. I also said:
Each of the Applicant and the Respondent maintained from the moment the proceedings were in my docket that the other was a liar and a fraud and that he or she should actually end up with every bit of the remaining property to the total exclusion of the other. Each of them present his and her case with that outcome solely in mind.
It has taken days and days of careful consideration of the evidence and scrutiny of the documents that they each adduced into evidence for me to determine, as best I could, in the face of totally contrasting assertions and submissions by each of them, the relevant factual history as it really happened.
As is clear from those passages just quoted, the First Respondent was not adjudged an innocent party simply suffering from the grossly unjust claims of the other party. I recall there were many occasions when the matter was before me when one of the Court’s most valuable resources, its judicial time, were, quite frankly, wasted on frivolous interim applications brought by the First Respondent. So, too, though, the late Applicant was not averse to making time-consuming applications, the prospects of which were always dubious. Some of that can understandably be put down to the fact that for much of the proceedings, each was left to their own devices, without legal advice, in respect of considering the factual and legal merit of their positions. That acknowledged, I do not hesitate to express my view that the conduct of each of them demonstrated unhealthy obsession with the litigation and the determination, on the part of each of them, to “win at all costs” regardless of the consequences for the other party - the other parent of their child.
As is also now abundantly clear, it is fair to say that neither the late Applicant nor the First Respondent was wholly successful in the overall proceedings. Certainly, neither of them obtained that which they always argued to the Court that he or she should obtain. Importantly though, the statutory provision requires me to consider whether either has been “wholly unsuccessful” in the proceedings.
I cannot say that either of them has been “wholly unsuccessful” in the proceedings, other than to observe that if “success” is to be determined by whether or not each achieved precisely that which they argued for then, by that measure, each has been “unsuccessful”.
Where the First Respondent has fallen far short of that for which he was always arguing, it is difficult to perceive how an order that he be paid all of his costs on an indemnity basis would be justified, save for, perhaps, an absolutely clear cut case of an early written offer of settlement being determined to have been unreasonably refused and found to be comparatively (when precisely considered) better for the party who unreasonably refused it than the final outcome. However, as I have already determined, this is not one of those clear cut cases. I have already ruled that out.
Another matter I do consider of some relevance is the fact that the First Respondent now has an extant application to set aside the final Orders pursuant to s 90SN of the Act. He asserts that he and/or the child who is now in his care since the death of the Applicant (said to be circumstances of an exceptional nature relating to the care, welfare and development of the child) will suffer hardship if the Court does not vary the order, or set it aside and make another one in substitution for it. As I said in Court, my preliminary view is that there may well be merit in the First Respondent’s application and he could, yet, end up with a greater share of the remaining cash that is currently invested through the superannuation fund waiting to be distributed pursuant to the final orders. That is a matter relevant to the financial circumstances of the parties. There are, I consider, some reasonable prospects of improvement in the First Respondent’s financial position in any event. That is yet to be finally determined though.
Finally, I refer to a matter that I pointed out to the parties several times over the last few years. On an interim basis, I ultimately prevented the late Applicant from using the cash funds from the sale of their properties to buy another property, and ordered all of that money to be secured in the First Respondent’s then solicitor’s trust account. It has remained securely kept, earning interest, since then. That is in the context of the First Respondent’s current assertions that had that been allowed to happen there was a conspiracy between the late Applicant and her mother to secretly sell that property and disperse the proceeds to his prejudice. However, the money was readily available to meet the demands of the reinstatement of their superannuation member benefits and to enable their SMSF to be made compliant again without significant tax consequences brought about by their breaches of the regulatory laws. I also refused multiple applications brought by each of them (and the other Respondent companies) for interim litigation costs funding in which they each sought interim distribution of large sums of those funds to pay for legal representation.
I am quite satisfied that had they been given access to those funds to meet legal costs along the way, that it would still be most unlikely that they would have settled the dispute and far more likely that they would have just dissipated most, if not all, of the money that remains to be divided pursuant to my final orders. It is available to the First Respondent and the estate of the late Applicant because of the interim orders that were made and the applications that were refused, over much consternation.
In conclusion, I consider it sufficient to say that to determine that the First Respondent, Mr Loomis, should now be granted all of his costs on an indemnity basis would be, in my respectful judgment, far from just, let alone justified.

The Submissions of the Late Applicant

The late Applicant asserted in an affidavit she filed one month before her death, just as the First Respondent had asserted against her, that he “has dragged out these matters and provided volumes of enormous irrelevant affidavits.” She asserted that she incurred substantial costs as a result of having to deal with them. She asserted that the First Respondent had made some “farfetched ridiculous” assertions such as the Applicant being involved in money laundering, an arsonist, and being connected with the Melbourne mafia. I observe that he had also made repeated allegations of her being involved in many conspiracies to defraud him and mislead this Court. She asserted that the First Respondent had failed to comply with many orders that had been made in the proceedings over the years and that such failure had resulted in increased legal costs for her as well as other losses.
I am satisfied that there is some merit in those assertions made by the late Applicant that I have referred to. Much of my time in this matter has been taken up reading lengthy, prolix, tediously repetitive affidavits provided in bundles of hundreds, if not thousands of pages, by the First Respondent. I have an understanding of the difficulties that the solicitors and barrister retained at times by the late Applicant would have faced reading and understanding those documents and preparing to meet them.
Nevertheless, as I have said earlier in these reasons, all righteousness in this matter certainly does not rest on the side of the late Applicant. I was satisfied on an interim basis, and even more convinced after hearing and considering her evidence given at the trial, that the late Applicant was quite prepared to lie to the Court under oath and from the Bar table whenever she thought it would suit her – by making false assertions against the First Respondent and making false denials in response to his assertions against her.
I do not consider it necessary now to say more about this. The late Applicant is now deceased. I simply do not consider the circumstances of the case justify a costs order being made in favour of the late Applicant’s estate and I will not make any such order.

The Second Respondent’s Submissions

The Second Respondent company, through the First Respondent, seeks an order that its costs from the date it was joined to the proceedings whilst they were still in the FCC be paid by the late Applicant’s estate. The company was joined on 31 July 2013. The proceedings were transferred to this Court and first heard by me in 2014.
The submissions and affidavit material relied upon by the Second Respondent still assert, notwithstanding my findings in my January 2018 reasons for judgment, that the Second Respondent is “a separate legal entity”. I understand that to be a submission that the property of the company should not have been treated as the property of the First Respondent. Further, the submissions go on in a way that is somewhat difficult to follow and understand, but I apprehend they assert that the debt asserted to be owed by the late Applicant to the Second Respondent should have been found to be a debt owing by her and ordered to be repaid by her. That interpretation would be consistent with the Respondents’ position maintained throughout.
I have informed Mr Loomis throughout the proceedings that I was reasonably satisfied that the companies are his “creatures”, “alter ego” or “puppets” and that I would be likely to be treating their assets as his. In my reasons for judgment, I made those findings without hesitation. It is a matter for Mr Loomis and the other Respondents to take up in the appeal against my final Orders that is extant, if he (and/or the companies) contends, as he still appears to, that I erred in so finding.
Included in the submissions for the Second Respondent is reliance on the March 2012 written offer of settlement again. I have already dealt with that issue and determined that the terms of that offer do not persuade me to find that a costs order is justified. In respect of the Second Respondent’s position, the observations I made earlier provide an even stronger basis for refusing to make an order for costs in its favour. The lack of an offer (in that particular March 2012 offer of settlement) of a discharge of the debt to the company or an indemnity in respect of any liability for that debt in a way that made it clear to the late Applicant that she would be immune from liability at the suit of the companies is a clear basis, in my judgment, for rejecting the submission that the written offer plainly justifies a costs order in favour of the company.
I also discern, both from past in-court exclamations and from his written material, that Mr Loomis submits that the companies should never have been joined in the proceedings in the first place and, therefore, costs should follow. I unhesitatingly reject such a submission.
Where there is a case being run in property alteration proceedings that the property of third party companies should be treated in the proceedings as the property of one of the parties, and the party disputes that or does not concede it, joining the third party company or companies is not necessarily an inappropriate action. In this case, the companies were joined in that context, but also in the context of the late Applicant seeking orders against them restraining them from dealing with their assets that she asserted were really Mr Loomis’s assets and also restraining them from taking action against her to recover the debts alleged to be owed by her alone. Those injunctions were granted by Judge Howard in the FCC and never appealed against. Notwithstanding their existence, as I have already observed, the companies still took steps to try and recover the debts they asserted the late Applicant owed them.
It was, in my judgment, quite appropriate to join the companies and in my final Orders, I included injunctions restraining those companies from taking any further steps to attempt to enforce their claims against the late Applicant.
I will not make any costs orders as sought by any of the parties. I am not of the opinion that the circumstances justify any.
All extant costs applications will be dismissed.

I certify that the preceding sixty-one (61) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Forrest delivered on 9 August 2018.

Associate:

Date: 9 August 2018

[2018] FamCA 597

9 August 2018

Key Legal Topics

Areas of Law

Civil Procedure

Legal Concepts

Costs

Appeal