VENIS & PAITSON

[2020] FamCA 174

FAMILY COURT OF AUSTRALIA

VENIS & PAITSON [2020] FamCA 174

FAMILY LAW – COSTS – Circumstances justifying order – where applicant seeks her costs arising from the Respondent’s Notice of Objection to Subpoena

Family Law Act 1975 (Cth) ss 117

In the Marriage of  I & I  (No 2) (1995) 22 Fam LR 557

APPLICANT: Ms Venis

RESPONDENT: Mr Paitson

FILE NUMBER: MLC 8250 of 2018

DATE DELIVERED:  23 March 2020

PLACE DELIVERED: Melbourne

PLACE HEARD: Melbourne

JUDGMENT OF: Williams J

HEARING DATE: 11 February 2020

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Trim

SOLICITOR FOR THE APPLICANT: KCL Law

COUNSEL FOR THE RESPONDENT: Mr Bartfeld Q.C

SOLICITOR FOR THE RESPONDENT: Marshalls and Dent and Wilmoth

Orders

1. On or before 60 days from the date of these orders the Respondent pay the Applicant’s agreed costs of and incidental to the following court appearances, and such costs to be calculated in accordance with the relevant scale:

   (a)       Subpoena Hearing on 23 October 2019, before a Registrar;

   (b)       Interim Hearing on 17 January 2020;

   (c)       Interim Hearing on 11 February 2020.

2. In the default of agreement between the parties the costs be taxed.

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 Venis & Paitson 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 MELBOURNE

FILE NUMBER: MLC 8250 of 2018

Ms Venis

Applicant

And

Mr Paitson

Respondent

REASONS FOR JUDGMENT

Introduction

1. Ms Venis is the applicant in the substantial proceedings commenced on 20 July 2018, and Mr Paitson is the respondent in the substantial proceedings. For the convenience and clarity, Ms Venis in these reasons is referred to as the applicant and Mr Paitson is referred to as the respondent.

2. The issue to be determined is whether the respondent should pay the applicant’s costs arising from Notices of Objection to Subpoenae, the subpoenae were filed by the applicant.

3. The applicant seeks her costs calculated in accordance with the relevant scale, and the respondent seeks that costs should be reserved for determination by the trial judge.

Background

1. On 20 July 2018, the applicant filed in the Federal Circuit Court of Australia:

   a)an Initiating Application seeking a declaration that a de facto relationship existed between the applicant and the respondent from August 2012 to 5 January 2018;

   b)an affidavit and Financial Statement in support of her application.

2. On 10 August 2018, the respondent filed a Response seeking that the application be dismissed. He did not file an affidavit in support of the Response.

3. On 12 September 2018, the applicant filed the following subpoenae:

   i)B Counselling;

   ii)D Medical Centre;

   iii)C Medical Centre;

   iv)E Lawyers;

   v)F Medical Centre;

   vi)Ms H, Psychologist;

   vii)G Counselling;

   viii)J Medical Centre;

4. All subpoenae, except the one addressed to E Lawyers, were for medical or health professional records of the respondent.  

5. On 20 September 2018, the respondent filed Notices of Objection to each of the subpoena filed by the applicant.

6. On 21 February 2019, the proceeding was transferred to this court and was listed before a Registrar on 14 June 2019.

7. On 23 October 2019, the subpoenae dispute was determined by a Registrar. Orders were made dismissing the objections to the subpoenae and releasing the documents produced pursuant to the subpoenae, for inspection.

8. On 31 October 2019, the Respondent filed an Application in a Case seeking a review of the Registrar’s decision.

9. The review application was initially listed on 11 December 2019, however it was unable to proceed on that day.  The application was adjourned to 17 January 2020 when submissions were made by counsel appearing on behalf of both parties.

10. On 17 January 2020, orders were made:

    i)adjourning the subpoenae application to 10 February 2020; and

    ii)granting leave to the solicitor for Mr Paitson to inspect all documents produced pursuant to the subpoenae, to identify which documents the respondent objected to being released.

11. On 11 February 2020, orders were made, in accordance with a Minute prepared by the parties, permitting the solicitor for the applicant to inspect all documents produced pursuant to subpoenae addressed to:

    i)D Medical Centre;

    ii)B Counselling;

    iii)Ms H, psychologist

    iv)G Counselling;

    v)C Medical Centre.

12. Orders were also as follows:

    i)in relation to the records produced by the F Medical Centre, the solicitor for the respondent have leave to redact the page initialled by me in the clinic notes of January 2018.  That order was made because the redacted comments were subject to legal professional privilege.

    ii)in relation to the documents produced by E Lawyers concerning a private investigator, those documents be returned to the solicitors;

    iii)all interim applications be otherwise dismissed.

13. At the conclusion of the application Counsel for the applicant sought an order for costs in accordance with scale and Senior Counsel for the respondent sought the costs should be reserved to the trial judge.

Legal principles

1. Section 117(1) of the Family Law Act 1975 (“the Act”), states, subject to the provisions of s.117(2), that the general rule in proceedings in this court, is that each party to proceedings, shall each bear his or her own costs.

2. Section 117(2) of the Act provides as follows:

   If, in proceedings under this act, the court is of the 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.

3. Section 117(2A) of the Act provides, that in considering what order (if any) should be made for the payment of costs, the court shall have regard to the following matters:

   (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.

4. In the Marriage of  I & I  (No 2) (1995) 22 Fam LR 557, the Full Court said that the relevant matters in s.117(2A):

   “…must all be taken into account and all balanced in order to determine whether the overall circumstances justify the making of an order for costs”

Section 117(2A)(a) the financial circumstances of each of the parties

1. There is limited evidence about the current financial circumstances of the parties.  The applicant filed a Financial Statement on 20 July 2018 and an affidavit on the same date.

2. Paragraphs 52 and 53 the affidavit refer to the property pool as asserted by the applicant and paragraphs 55 to 57 refer to the applicant’s then financial circumstances.

3. The applicant’s financial position as at July 2018 can be described as strained. She deposes to not receiving any salary or income other than rent of $550 per week from two properties.

4. At paragraph 33 of her Financial Statement she deposes to total personal expenditure per week of $1268. There is no explanations as to the discrepancy in income and expenditure.

5. At paragraphs 35 and 36 of her Financial Statement she deposes to owning a property in New South Wales which she values at $459,000 and a ½ interest in a property in New South Wales, which she estimates is worth $275,500.  Both properties are encumbered by mortgages totalling $375,000. Additionally, at paragraph 53 she deposes to a HECS student debt of $80,000.

6. The applicant’s affidavit filed 20 July 2018 refers to 3 properties which she asserts the respondent owns:

   i)K Street, Melbourne, which she estimates is worth $2 million, which was purchased unencumbered in August 2014.  The property is now the subject of a dispute in the Supreme Court arising from a mortgage registered by the respondent’s parent’s company on 26 October 2017;

   ii)a quarter share in L Street, M Town, Victoria, the value of which she does not know;

   iii)N Street, Suburb O, City P, UK, the value of which she does not know.

7. On 14 June 2019, orders were made by consent providing a timetable for filing documents.  Paragraph 4 of those orders provides a timetable for the respondent to file and serve all affidavits-in-chief on which he seeks to rely. He has chosen not to file an affidavit responding to the applicant’s assertions, and in particular, about his assets.

8. Notation 1 to the orders of 11 February 2020 provides that the respondent does not intend to file an affidavit pursuant to paragraph 4 of the Registrar’s orders made 14 June 2019, and he will file a trial affidavit in compliance with the trial judge’s directions.

9. Additionally the respondent has not filed a Financial Statement, as is his prerogative, because the substantive proceedings are a threshold dispute about the existence of a de facto relationship.

10. The only evidence about his financial situation is the applicant’s evidence, which is currently not challenged by the respondent, despite the respondent having been afforded the opportunity.

11. Senior Counsel for the respondent submitted that the financial circumstances of a party, should not be gauged by that party’s representation.

Section117 (2A) (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

1. This is not a relevant consideration as neither party is in receipt of legal aid.

Section117 (2A)(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

1. Counsel for the applicant submitted:

   i)the respondent had aggressively opposed each interim application and had been represented by Senior Counsel on each occasion;

   ii)the applicant had to meet the costs of the intervention order proceedings between herself and the respondent and the Supreme Court proceedings between herself and the respondent’s mother.  In the context of the Supreme Court proceedings, the respondent’s mother’s asserted mortgage and loan documentation had surfaced subsequent to the parties separation;

   iii)the aggressive litigious conduct of the respondent has resulted in the applicant incurring significant legal costs which should not have been incurred;

   iv)if the Respondent sought to view the documents produced pursuant to the subpoenae to ascertain whether he wished to object to the production of the documents, he could have availed himself of the procedure set out in rr.15.31(3) and (4) of the Family Law Rules 2004.

2. The relevant rule provides:

   Family Law Rules 2004 – r.15.31

   Objections relating to production of documents

   […]

   (3)  If a subpoena for production requires the production of a person's medical records, the person may, before the day (the production day) on which production in accordance with the subpoena is required, notify the Registry Manager in writing that the person wishes to inspect the medical records for the purpose of determining whether to object to the inspection or copying of the records.

   (4)  If a person (the potential objector ) gives notice under subrule (3):

   (a)  the potential objector may inspect the medical records; and

   (b)  if the potential objector wishes to object to the inspection or copying of the records--the potential objector must, within 7 days of the production day, give written notice of the objection and the grounds for the objection, to the Registry Manager; and

   (c)  unless the court orders otherwise, no other person may inspect the medical records until the later of:

   (i)  7 days after the production day; and

   (ii)  if the potential objector makes an objection under paragraph (b)--the end of the hearing and determination of the objection.

3. Senior Counsel for the respondent submitted that costs should be reserved to the trial judge, because the proceeding is a threshold determination and it may be that the applicant will not be successful in the substantive proceeding.

Section 117(2A)(d) whether the proceedings were necessitated by the failure of a party to the proceedings to comply with previous orders of the court

1. This is not a relevant consideration.

Section 117(2A)(e) whether a party to the proceedings has been wholly unsuccessful

1. At the commencement of the hearing on 11 February 2020 the applicant and the respondent submitted a Minute of Proposed orders. The minute provided for the release to the applicant’s solicitor of documents produced pursuant to the subpoenae addressed to :

   i)D Medical Centre;

   ii)B Counselling, psychotherapy, education/training;

   iii)Ms H;

   iv)G Counselling, counselling psychologist;

   v)C Medical Centre.

2. During the hearing Senior Counsel for the respondent raised a possible objection to the documents produced by F Medical Centre, arising from legal professional privilege. There was no such issue raised by the respondent in the comprehensive written submissions filed on his behalf. After inspection of the records I identified one relevant entry in the clinic’s records, and an order was made providing for the redaction of that portion of the clinic’s records.

3. At the conclusion of the hearing on 11 February 2020, minutes were agreed in relation to conditions for production of the documents by J Medical Centre and F Medical Centre. It was also agreed that the documents produced by E Lawyers which relate to the private investigator, would be returned to that firm.

4. The applicant was substantially successful in obtaining the release of the documents and in particular the release of the relevant medical files.

Section 117 (2A) (f) any other matters the court considers relevant

1. All other matters relevant have been referred to in these reasons.

Conclusion

1. I have considered and taken into account all of the relevant matters in s.117(2A) of the Act and I am satisfied that there are justifying circumstances to depart from the general rule that each party shall bear his or her own costs.

2. In particular I have had regard to the following:

   i)The respondent has chosen not to provide any financial information about his financial circumstances, despite being afforded the opportunity to do so. On the evidence of the applicant, I am satisfied that the respondent has assets and resources and enjoys a superior financial position to the applicant; 

   ii)The respondent’s conduct during the course of the dispute, in particular the failure to utilise the procedure set out in Rules 15.31(3) and (4). Had that procedure been adopted, it may well have enabled the dispute to be resolved far more expediously and without the considerable court time and resources which have been required to effect resolution;

   iii)The substantial success of the applicant in securing production of the majority of the documents sought by her;

   iv)The costs incurred by the applicant resulting from a discrete interlocutory dispute, namely the subpoena issue, should be determined by the relevant Judge, and are not contingent upon the ultimate resolution of the substantive proceeding.

Quantum

1. Counsel for the Applicant sought costs on scale, but did not provide a calculation of applicable costs.

2. I consider that the respondent should pay the applicant’s costs of and incidental to the following hearings:

   i)23 October 2019 before a Registrar;

   ii)17 January 2020;

   iii)11 February 2020.

3. The respondent should not be liable for any costs incurred for the following hearings:

   i)13 September 2019, as the hearing was as a result of the transfer of the file from the Federal Circuit Court to this court;

   ii)11 December 2019, as the court was unable to determine the matter due to a part heard trial continue.

4. The order I intend to make will provide for the respondent to pay the applicant’s costs of and incidental to the hearings referred to in the previous paragraph, such costs to be calculated in accordance with scale, and in default of agreement, to be taxed.

I certify that the preceding forty seven (47) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Williams delivered on 23 March 2020

Associate: 

Date: 23 March 2020