UNDERWOOD & PRATT
[2015] FCCA 1818
•30 June 2015
FEDERAL CIRCUIT COURT OF AUSTRALIA
| UNDERWOOD & PRATT | [2015] FCCA 1818 |
| Catchwords: FAMILY LAW – Costs – application for costs – where applicant was successful in proceedings under the Family Law Act 1975 (Cth) – financial circumstances of the parties considered – where applicant was in receipt of legal aid – where party and party costs in accordance with Federal Circuit Court Rules 2001 Sch.1 Part 1 exceed amount actually charged to Legal Aid NSW – where a party may not claim more by way of costs than actually charged. |
| Legislation: Family Law Act 1975 (Cth), s.117 Legal Aid Commission Act 1979 (NSW), s.41 |
| Cases cited: Prantage & Prantage [2013] FamCAFC 105; (2013) 49 Fam LR 197; FLC 93-544 Underwood & Pratt [2014] FCCA 3079 Wade & McPherson [2014] FCCA 1321 |
| Applicant: | MS UNDERWOOD |
| Respondent: | MR PRATT |
| File Number: | NCC 2003 of 2010 |
| Judgment of: | Judge Scarlett |
| Hearing date: | 18 March 2015 |
| Date of Last Submission: | 18 March 2015 |
| Delivered at: | Sydney |
| Delivered on: | 30 June 2015 |
REPRESENTATION
| Solicitor for the Applicant: | Mr Haricharan |
| Solicitors for the Applicant: | Hunter Family Law Centre |
| Respondent: | In person |
ORDERS
The Respondent is to pay the Applicant’s costs fixed in the sum of $8,961.98.
The Respondent is allowed six (6) months to pay.
IT IS NOTED that publication of this judgment under the pseudonym Underwood & Pratt is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT SYDNEY |
NCC 2003 of 2010
| MS UNDERWOOD |
Applicant
And
| MR PRATT |
Respondent
REASONS FOR JUDGMENT
Application
This is an Application for costs made by the wife, who was the successful Applicant in parenting proceedings heard in this Court last year (Underwood & Pratt[1]). The Application is supported by an affidavit of the Applicant’s solicitor, Ms Furner, dated 11 December 2014.
[1] [2014] FCCA 3079
In her affidavit, Ms Furner deposes that her client was legally aided by Legal Aid New South Wales and annexes copies of:
a)Three grants of aid dated 17 June, 4 November and 28 November 2014;
b)Nine invoices submitted to Legal Aid NSW between 14 October and 8 December 2014.
The invoices total $8,961.98, which is clearly the amount sought from the Respondent.
The Respondent opposes the application, telling the Court that an order for costs would cause hardship to him, particularly as he was unemployed from November 2014 to February 2015.
Applications for costs in family law proceedings
Whilst costs are discretionary, that discretion must be exercised within the confines of s.117 of the Family Law Act 1975(Cth). Subsection (1) sets out the general proposition that each party to proceedings under the Act should bear his or her own costs, but s.117(2) provides that:
If, in proceedings under this Act, the court is of opinion that there are circumstances that justify it in doing so, the court may, subject to subsections (2A), (4), (4A) and (5) and the applicable Rules of Court, make such order as to costs and security for costs, whether by way of interlocutory order or otherwise, as the court considers just.
The only relevant subsection is s.117(2A), which contains some seven matters to which the Court must have regard.
Submissions
The solicitor appearing for the Applicant, Mr Haricharan, submitted that an order for costs should be made because the Applicant had been wholly successful in the matter. The Applicant was legally aided, as was set out in Ms Furner’s affidavit.
The Respondent submitted that the Applicant had amended her Application less than a month before the trial. He said that at no point during the proceedings was the issue of costs ever raised. Further, he submitted that an order for costs against him would cause hardship to his family because he had been unemployed from November 2014 until February 2015.
Considerations under s.117(2A) of the Family Law Act
The Court is required by s.117(2A)(a) to consider the financial circumstances of the parties. The Applicant’s finances were such that she qualified for a grant of legal aid.
It is a consideration that the Respondent was unemployed from November to February, a period of three or more months, which would have had a negative effect on his income.
The Applicant was in receipt of a grant of Legal Aid but the Respondent was not. The Applicant was therefore in a position to be represented by a solicitor and Counsel. The Respondent had been represented, but his solicitor withdrew prior to the final hearing.
The fact that a party to a proceeding is legally aided does not mean that an order for costs should not be made to a legally aided party. It is a matter of public knowledge that Legal Aid agencies have limited funds, and if circumstances justify an order for costs, then it is appropriate that the particular Legal Aid agency should receive back some of the money expended on a party’s representation.
The Court is required by s.117(2A)(c) to consider the conduct of the parties to the proceedings. Neither party can be subject to criticism for the way in which the proceedings were run. The fact that the Applicant filed an Amended Application on 18 September 2014 when the hearing was scheduled to commence on 13 October is not a matter for criticism.
The proceedings were not necessitated by the failure of a party to comply with previous Orders of the Court.
Paragraph (e) of s.117(2A) requires the Court to have regard to “whether any party has been wholly unsuccessful in the proceedings”. Mr Haricharan for the Applicant put the submission the other way, that the Applicant had been wholly successful, which she had. If the Respondent had been fortunate enough to be legally represented he may have been able to settle the matter either before or at some point during the hearing if his lawyer had been of the view that the Applicant had a strong case.
It was not put to the Court that either party had made an offer in writing to the other party to settle the proceedings (s.117(2A)(f)).
There are no other relevant matters.
Conclusions
On balance, the Applicant should be entitled to an order for costs. She was successful in the proceedings but it took three hearing days to do so. The fact that a party’s financial circumstances are strained, especially by a period of unemployment, as a relevant factor, but that does not of itself act as a bar to a costs order. The Court should consider time to pay in those circumstances.
The Applicant will receive an order for her costs calculated on a party and party basis, which is the usual basis (Prantage & Prantage[2]).
[2] [2013] FamCAFC 105; (2013) 49 Fam LR 197; FLC 93-544
The amount claimed by the Applicant is the amount of $8,961.98, being the total amount charged to Legal Aid NSW under the Legal Aid Scale. I have calculated the amount which would be payable for these proceedings under the scale set out in Part 1 of Schedule 1 of the rules, and by my calculation that total allowable amount would have been $11,500.00 plus disbursements.
The figure of $11,500.00 is significantly greater than the amount of $8,961.98 charged to Legal Aid NSW, however, as I held in Wade & McPherson[3] at [71], the Applicant is precluded by the provisions of s.41 of the Legal Aid Commission Act 1979 (NSW) from obtaining more by way of costs than is payable by Legal Aid.
[3] [2014] FCCA 1321
Whilst I would have allowed the amount of $11,500.00 had the Applicant not been in receipt of a grant of Legal Aid, in my view the proper amount must be the lesser sum of $8,961.98, the amount charged to the Legal Aid Commission. Whilst this is in effect an indemnity, it has come about only because of the fact that the Legal Aid scale is lower than the Court scale.
I will order that the Respondent is to pay the Applicant’s costs fixed in the sum of $8,961.98. I will allow six months to pay in the circumstances.
I certify that the preceding twenty-three (23) paragraphs are a true copy of the reasons for judgment of Judge Scarlett
Associate:
Date: 1 July 2015
0
3
4