Tobey & Rezek (No. 2) - [2012] FamCAFC 133

FAMILY COURT OF AUSTRALIA

TOBEY & REZEK (NO. 2)

[2012] FamCAFC 133

FAMILY LAW ─ APPEAL ─ Application for security of costs ─ Security for costs ordered in reliance upon the appellant’s longstanding failure to comply with costs order against him in previous appeal ─ Court not satisfied that the appellant lacked capacity to pay outstanding costs of previous appeal, and lodge security for costs of present appeal ─ Hearing of appeal stayed unless appellant pays outstanding costs of previous appeal, and has lodged security for costs for present appeal

Family Law Act 1975 (Cth)

Luadaka and Luadaka (1998) FLC 92-830

APPELLANT:

Mr Tobey

RESPONDENT:

Ms Rezek

INDEPENDENT CHILDREN’S LAWYER:

Evans Family Lawyers

FILE NUMBER:

CAC

740

2008

APPEAL NUMBER:

2012

DATE DELIVERED:

22 August 2012

PLACE DELIVERED:

Sydney

PLACE HEARD:

Sydney

JUDGMENT OF:

Coleman, Ainslie-Wallace and Ryan JJ

HEARING DATE:

22 August 2012

LOWER COURT JURISDICTION:

Federal Magistrates Court

LOWER COURT JUDGMENT DATE:

14 December 2011

LOWER COURT MNC:

FMCAfam 1336

REPRESENTATION

COUNSEL FOR THE APPELLANT:

Self represented

COUNSEL FOR THE RESPONDENT:

Mr Hopkins

SOLICITOR FOR THE RESPONDENT:

Legal Aid Commission ACT

Orders

That the hearing of the appellant father’s Notice of Appeal filed 28 March 2012 is stayed pending further order of the Full Court provided that, if by 1 October 2012 the appellant father has:
(a)paid $5000 to the respondent mother pursuant to the costs order made by the Full Court on 8 April 2011; and
(b)lodged security for the mother’s costs of the father’s appeal in the sum of $7,500
then the appeal will hereof be heard before a bench of three (3) Judges in Canberra on 24 October 2012.
That the appellant father pay to the respondent mother the costs of the application filed on 16 March 2012 as agreed and assessed in the sum of $2,200.
That the appellant father file and serve a summary of argument for the hearing of the appeal by the 1 October 2012 in the event that Order 1 hereof is complied with by that date.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Tobey & Rezek (No. 2) has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT SYDNEY

Appeal Number: EA 14 of 2012

File Number: CAC 740 of 2008

Mr Tobey

Appellant

And

Ms Rezek

Respondent

And

Independent Children’s Lawyer

EX TEMPORE

REASONS FOR JUDGMENT

coleman j

Before the Court for determination is an application by Ms Rezek (“the mother”), that Mr Tobey (“the father”), provide security for the costs of the hearing of a Notice of Appeal filed by the father on 28 March 2012. By his Notice of Appeal, the father challenges parenting and financial orders made by Neville FM on 14 December 2011. The father resists the mother’s application for security for the costs of the appeal.
As the evidence before the Court, and particularly the sequence of letters and emails which have passed between the father and the mother’s solicitors confirm, the application arose, essentially, because the father has failed to pay costs ordered against him by the Full Court on 8 April 2011 consequent upon the dismissal of the father’s appeal against earlier interlocutory orders made by Neville FM.
The quantum of the costs which have not been paid is not in issue. The sum of $5000 has, by default or otherwise, been accepted by the father as the costs to which the mother is entitled.
To their credit, the attorneys for the mother have repeatedly, and consistently made clear to the father that they would not either seek, or persist in seeking, an order for security for costs of the present appeal if the father met his outstanding obligation to pay $5000 with respect to the previous Full Court appeal. It is unnecessary and unhelpful for present purposes to refer in detail to the chain of correspondence evidencing these matters.
To the extent that the father suggests that he has been under any misapprehension in relation to his liability, nothing to which the Court has been referred establishes a rational or reasonable foundation for such misapprehension or uncertainty. At the commencement of the proceedings before the Court this morning, the father was asked when he intended to pay the $5000 payable to the mother pursuant to the previous Full Court orders. The father stated that he “did not know” when he intended to pay the $5000. Later in his submissions, the father stated that he “did not know” when he would be able to pay that sum.
The mother is accordingly in a position where, notwithstanding that the obligation crystallised almost 18 months ago, has not been challenged, and is not challenged now, the father has given no indication of when he will make the payment to which the mother is entitled.
The authorities in relation to this application are not in doubt. They were summarised by the Full Court, amongst other places, in Luadaka and Luadaka (1998) FLC 92-830. As suggested to the father during the course of his submissions, the Court’s task in exercising its discretion in relation to this application essentially involves balancing, on the one hand, the right of an aggrieved litigant to challenge the decision of the subordinate court, whilst, on the other, avoiding exposing the respondent to the risk that if the appeal is unsuccessful, and costs of the unsuccessful appeal are awarded, the successful respondent will be unable to recover such costs.
With respect to him, the father’s position is, ultimately, less than clear. On the one hand, he appears to assert that security for costs is unnecessary as he will meet his obligations if his appeal fails, and costs are awarded against him. On the other hand, as the transcript of his submissions to the Court this morning would confirm, the thrust of the father’s assertions before us has been that he is in difficult financial circumstances, and unable to say when he will be able to pay $5000 with respect to his previous appeal.
Accepting for the purpose of this application that everything the father has said in relation to his asset and income position could be established by admissible evidence, the position remains that the father has equity of the order of $100,000 in his property at Q. That equity exists after, the father informed the court, he had refinanced his borrowings secured over the property in order to meet, as he undoubtedly did, the mother’s entitlement to a settlement of property in the sum of $124,000, and the sum of $95,000 payable to attorneys who formerly acted for him. As Ainslie‑Wallace J inferentially pointed out to the father during the course of submissions in relation to those matters, it does seem surprising that an additional $5000 was not, or could not, have been procured at that time, so that the father could comply with his, by that time, longstanding unmet obligations under the orders of the Full Court.
Whether out of what he asserts is his reduced income which, on any view of it, remains substantial, or out of capital, or a combination of them, I am comfortably satisfied that the father has, and has at all materials times, had the capacity to meet the cost order made by the Full Court in April 2011.
With respect to him, the more the father’s submissions, particularly towards the latter stages of them proceeded, the more satisfied I became that the father had determined that, notwithstanding that he has never formally challenged his obligation, and does not now, he does not genuinely intend to meet his obligations under the Full Court orders. The father’s submissions to this Court, and the evidence in relation to the history of non‑payment of the $5000 provide, in my view, an abundant foundation for concluding that if security is not imposed, and the mother successfully resists the father’s appeal against Neville FM’s orders, the mother will experience very considerable difficulty, and delay in seeking to recover costs if they are awarded.
In my view, that position ought, as a matter of justice, be avoided. So doing would not on the material before this Court, in my view deny the appellant father his legitimate entitlement to agitate his challenges to the decision of the learned Federal Magistrate. The balancing exercise, in my view, comfortably accommodates imposing as conditions of the father being able to proceed to have his appeal heard, a requirement that he satisfy the $5000 outstanding with respect to the previous Full Court appeal, and lodge the sum of $7500 by way of security for the hearing of the appeal.
The former sum is not, and cannot be controversial. The obligation to pay it cannot be, and is not controversial. The latter sum, the father has, in my view, sensibly not disputed. Having regard to the number of grounds of appeal which the father articulates in his Notice of Appeal, and the various sub‑provisions of each of them, I consider security in the sum of $7500 to be conservative. Whilst it is, perhaps, unusual in a security application to include as a condition of the security order the payment of outstanding costs, I perceive no jurisdictional or discretionary impediment to doing so. Indeed, to fail to do so would, with respect to the appellant father, make a mockery of the security order in the circumstances of this case.
In earlier times, and to this day in many civil courts, an appellant would not be heard if, as is the case here, he or she was in breach of court orders. Imposing a requirement that at the time security is lodged the $5000 outstanding costs with respect to the previous appeal are paid is, in my view, both permissible, and appropriate in the circumstances of this case. For those reasons, I would make orders in the terms I have indicated.
The appeal is able to be heard by a bench of three judges in Canberra on 24 October 2012. The appellant father embraces the opportunity to have his appeal heard at that time. The respondent mother does not and, with respect, probably could not resist that date being fixed.
Balancing, on the one hand, the entitlement of the respondent mother to know whether or not she will have to meet the appeal, and the position of the appellant father in having to lodge and/or pay $12,500, I would consider 1 October 2012 to be an appropriate cut‑off date for the payment of outstanding costs, and the lodgement of security.
For my part, it would be appropriate to order that, if by that date, the father has paid the outstanding costs, and lodged security, then his appeal would be heard on 24 October 2012. If not, that date would be vacated, and the father’s appeal would be stayed pending further order of the Full Court.

ainslie-wallace j

I agree with the reasons for judgment of his Honour Coleman J, and the orders he proposes to make. I have nothing further to add.

ryan j

I too agree.

I certify that the preceding nineteen (19) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court (Coleman, Ainslie-Wallace & Ryan JJ) delivered on 22 August 2012.

Associate:

Date: 28.08.2012