Tibbins and Tibbins

[2007] FamCA 577

FAMILY COURT OF AUSTRALIA

TIBBINS & TIBBINS [2007] FamCA 577

FAMILY LAW - COSTS – Application brought by husband for recovery of documents necessary to effect earlier consent property orders – Wife failed to provide the documents – Circumstances justifying the order for costs.

Family Law Act 1975 (as amended)

APPLICANT: Mr Tibbins

RESPONDENT: Mrs Tibbins

FILE NUMBER: MLF 1874 of 2004

DATE DELIVERED: 21 May 2007

PLACE DELIVERED: Melbourne

JUDGMENT OF: Guest J

HEARING DATE: 21 May 2007

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr St John SC

SOLICITOR FOR THE APPLICANT: McDonald, Slater & Lay

COUNSEL FOR THE RESPONDENT: Ms Snyder

SOLICITOR FOR THE RESPONDENT: Susan Snyder

Orders

1. That the Form 2 Application of the husband filed on 20 April 2007 be dismissed.

2. That the wife do pay the husband’s costs of and incidental to the said application fixed in the sum of $7,500 AND THAT payment of the said costs be stayed for 60 days.

(3) That pursuant to rule 19.50 of the Family Law Rules 2004 this matter reasonably required the attendance of Counsel.

1. That pursuant to rule 19.51 of the Family Law Rules 2004 this matter reasonably required the attendance of a solicitor acting as Counsel.

FAMILY COURT OF AUSTRALIA AT MELBOURNE

FILE NUMBER: MLF 1874  of 2004

Mr Tibbins

Applicant

And

Mrs Tibbins

Respondent

REASONS FOR JUDGMENT

1. I have before me a Form 2 Application in a Case brought by the husband and filed on 21 May 2007.  By that application, the husband seeks an order for the delivery to him of certain documents including certificates of title and discharge of mortgages in respect of properties, as I understand it, held in the name of A Pty Ltd, and also the husband's superannuation fund together with the delivery of other documents described in paragraph 1B(i) to (iv) of the Application.

2. The husband’s Application is supported by a helpful affidavit sworn by him and filed on 20 April 2007.  The genesis to the problem lies in the effectuation of the final property orders which were made by consent on 8 June 2006, and in dispute before me was an interpretation concerning paragraphs 15, 16 and 17 of those orders.  In his affidavit the husband explained the basis underpinning his Application, and in particular the explanation provided in paragraphs 4 and 5 of that affidavit.  In summary, an advance was made by the wife of $1.4 million from the sale of the former matrimonial home which discharged certain liabilities in favour of the St George Bank thus clearing a number of titles and achieving a discharge of other encumbrances from the bank. 

3. The husband was then to raise a further $800,000 which would rank, as I understand it, first over the properties, and that his responsibility to the wife for the advance of the $1.4 million would in effect rank second, and thus provide to her security as anticipated in the consent orders.  The orders were carefully negotiated and required, as large money cases do in effecting the orders, a degree of commerciality, good common sense and co-operation.

4. When the matter came on before me this morning, I had what may be fairly described as a robust discussion with Mr St John, Senior Counsel who appears on behalf of the husband and Ms Snyder who appears on behalf of the wife.  In the result the relevant documents sought were provided to the husband's solicitor by Ms Snyder with an undertaking being given by his solicitor doing no less than expressing a duty she had in any event as an officer of the court. 

5. When the Application returned to me and with the relevant documents having been provided to the husband, Mr St John made an application for costs.  In support of his submissions, he provided a bundle of correspondence which speaks for itself.

6. I do not think it is necessary for me in these short extempore remarks to comprehensively detail the contents of each of the letters that have been tendered and relied upon by Mr St John which commence on 3 April 2007 and end on 8 May 2007.  I do so only in summary form.  Settlement occurred in early January 2007 and the first letter to which I have referred, namely, 3 April 2007 was directed to Mr Morgan who is  a conveyancing lawyer.  The letter was clear in its terms and provided (inter alia):

   “We reiterate the contents of our earlier letter in which we advised that we required the titles and discharge releases for lodging the documents which were held by Susan Snyder are security documents and cannot be lodged at this stage as [the wife] must wait for [the husband] to refinance prior to lodging her security documents.”

7. The author sought a reply.  Mr Morgan did reply some eight days later noting that the husband's solicitor was to forward a “copy of the Family Court orders” to him.  In a subsequent letter, the husband's solicitors made it clear that they had already done just that.  Mr Morgan must have forgotten that he had the court orders or did not examine his file with sufficient scrutiny to pick them up and in the course of his letter, had this to say:

   “We note that our client's family lawyer is not available until Monday.  We have discussed the matter with our client who advises that she is not prepared for us to lodge the documentation or release any documents to your client till we have received further instructions from Ms Snyder.  In particular our client understands that her security is to be registered over any other security being given by your client.”

8. The point from that letter is made with clarity that the wife was driving the train at that point of time, and had told Mr Morgan quite clearly that she was not prepared to release any of the documents.  The husband’s solicitor wrote again that day and made it clear, asserting in the course of their letter:

   “With respect, please read the order which states that your client must not lodge any of her security documents until our client has refinanced to a limit of $800,000.  He cannot do so without having in his possession clear titles of the properties which have passed to him pursuant to the order.”

9. The husband’s solicitor, properly in my view, then advised that they had instructions to issue proceedings unless the documents were received by the close of business on 12 April 2007.  They were not.  On that day, the husband's solicitors again wrote to Mr Morgan advising that the titles, discharges and accompanying documents which he held were his client's property pursuant to the orders and that he, Mr Morgan, was permitted by the husband to receive those documents from the bank at settlement simply to appease the wife and alleviate any concerns she may have had about her security.

10. The husband's solicitor sought the immediate return of the documents, claiming that a failure to do so was a breach of trust.  On 19 April 2007, in a somewhat bland response Mr Morgan wrote:

    “We refer to previous correspondence and in accordance with our client's instructions have arranged to deliver the original documents held by us to our client's family lawyer Susan Snyder.  Please direct all further correspondence in relation to this aspect of the matter to Ms Snyder.”

11. That could be read as an abdication of their responsibility to offer a commercially prudent, common sense and dignified resolution to the problem.  That was not shown by any measure.  The correspondence thereafter continued between the husband's solicitors and Ms Snyder, variously with copies to Mr Morgan, and on 19 April 2007, for example, Ms Snyder and Mr Morgan were advised by the husband’s solicitor that as they had not received the documents they were instructed to issue proceedings for their recovery and significantly, for costs.

12. A further letter on 20 April 2007 was dispatched to Ms Snyder, referring to previous correspondence and sought return of the documents.  Ms Snyder was advised that proceedings had been filed given the failure by the wife to comply with the orders of 8 June 2006.  Ms Snyder was also advised that the application was returnable on 21 May 2007, and again, the husband’s solicitor sought the return of the documents listed in earlier correspondence.  It was then put by the husband's solicitor:

    “Please let us know if you or your client intends to comply, failing which we have instructions to amend the application to include you as a party.”

13. That was on 20 April 2007.  Thus there was ample time before the return date of the Application on 21 May 2007 to offer a dignified resolution to a commercial problem.  There was a patent failure on the part of the wife to do so.  A letter dated 19 April 2007 from Ms Snyder to the husband's solicitors did not address anything about the documents, but was directed to another issue.  On 23 April 2007, the husband's solicitors wrote to Ms Snyder informing her that they had been advised that Mr Morgan had delivered the relevant documents to her, requested they be immediately returned to their office and that a failure to do so may result in proceedings being issued against Ms Snyder personally for return of the documents and for any consequential loss suffered by the husband.

14. In a letter to Mr Morgan of 23 April 2007, he was advised that he was named as a second respondent to the litigation.  Quick to respond and showing an unusual sense of alacrity compared to his earlier failure, Mr Morgan wrote on 26 April 2007 and had this to say:

    “The allegation that the documents referred to were held in trust by us for your client is refuted.  The documentation was held by us in accordance with our client's instructions.  In accordance with our client's further instructions same were delivered to our client's matrimonial lawyer with whom you have had ongoing dealings.”  (My emphasis)

15. Finally, on 8 May 2007, the husband's solicitors wrote to Ms Snyder and made it clear that the husband’s Application was going ahead.  Remarkably, there was no reply.  The matter was called on this morning and following a discussion I had with both Mr St John and Ms Snyder, the documents were provided and I am now dealing with the application for costs.  In his submissions, Mr St John said that all relevant documents had now been provided which would be part of the security required by the husband to finance the additional sum to which I have referred, and secure advances to the wife for the $1.4 million.

16. The essence of his complaint is that the wife, tentatively Mr Morgan or the wife's solicitors, had done nothing in the face of very reasonable correspondence and requests from the husband's solicitor.  It appears to me there existed a code of silence and what could be clearly construed as a wilful failure to cooperate in an orderly effectuation of the consent orders of 8 June 2006.  Mr St John is correct in submitting that the application could have been avoided “with communication”.  Given that the documents were provided in court, the husband can now do all that he was intended to do pursuant to the orders. 

17. Mr St John submitted that the whole exercise, in which the wife had been the dominant performer by reason of her instructions clearly to Mr Morgan and otherwise to Ms Snyder, was needless and indeed, unnecessarily expensive.  Mr St John submitted there was an obligation upon Mr Morgan and/or the wife's solicitor to respond and highlighted the fact that effectively, nothing was done.  Thus it was that the husband had no other option than to commit himself to these proceedings.

18. Section 117(1) of the Family Law Act 1975 (as amended) provides that, subject to subsection 2, each party shall bear their own costs. Section 117(2) provides that if in proceedings under the Act the court is of the opinion that there are circumstances that justify it in doing so, the court may make an order as to costs as may be considered just in the circumstances. That is, it is an entirely discretionary exercise on the part of the judicial officer considering the Application. Section 117(2A) provides for the matters for consideration relevant to a costs order, and includes the financial circumstances of each of the parties to the proceedings. There was no suggestion of course that the wife is in any way suffering financial hardship.

19. Section 117(2A) also provides that the court is to take into account “the conduct of the parties” to the proceedings and whether the proceedings were necessitated “by the failure of a party” to the proceedings to comply with previous orders of the court.  A further and important consideration is whether a party has been “wholly unsuccessful” in the proceedings.  The wife has been entirely unsuccessful.  Furthermore, I am concerned that her unnecessary obdurate conduct caused the husband to institute the proceedings.

20. It seems to me that the fault lies with herself alone and the costs should, in the circumstances, follow the event.  The submissions advanced by Ms Snyder were difficult to make given the position which she had been placed.  Nothing was advanced by her that can persuade me from my view, that in the exercise of my discretion, it is appropriate to make an order for costs. 

21. The issue is as to quantum.  Mr St John seeks an order for costs in the sum of $7500.  Counsel's fee of the day was set by agreement at $4000 and the balance of $3500 was to cover the solicitor's costs, attendance at court this day for several hours, drawing of documents, drawing of the Application and affidavit, attendance upon the husband, consideration in relation to various of the letters sent and other matters such as the preparation of the brief for proceedings this day.

22. Until this day there was no proposal from the wife as to her position.  It was only earlier this morning, following what I described as reasonably robust discussion, that the matter was adjusted, and sensibly so.  This could have been effected without the institution of proceedings.  Ms Snyder challenged the total sum of $3500 which rationalised by scale cost of $195.50 per hour, would equate, on her calculations to some 17 hours of work.  It seems to me that it is a matter appropriate for senior counsel.  I might say that I was greatly assisted by the submissions of Mr St John in explaining the reasonably difficult background to the application and his very helpful and ordered submissions on the issue of costs.  I do not accept the rather simplistic approach by Ms Snyder.

23. The issue is whether or not I should remit the matter for Assessment.  Having considered this process in the exercise of my discretion, it seems to me it would be a time wasting exercise and that the costs as requested do not seem to be unreasonable in the whole of the circumstances.  There would be additional cost associated with an Assessment, and which may bring the parties yet to greater and needless expense.  Whilst I thought there was some merit in Ms Snyder's submission, upon reflection and in the exercise of my discretion, having regard to the whole of the surrounding facts and circumstances, I propose to order costs in the sum of $7500. 

I certify that the preceding twenty three (23) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Guest.

Associate: 

Date:  8 June 2007

IT IS NOTED that this judgment for all publication and reporting purposes be referred to as TIBBINS & TIBBINS