VOLPE & STARK

[2019] FCCA 692

FEDERAL CIRCUIT COURT OF AUSTRALIA

VOLPE & STARK [2019] FCCA 692

Catchwords:
FAMILY LAW – Property – undefended hearing – de facto relationship of less than 2 years – significant contributions made.

Legislation:

Family Law Act 1975 (Cth), ss.75(2), 79(4), 90SB, 117(2), 117(2A)

Family Law Rules 2004

Federal Circuit Court Rules 2001 r.21.02(2)

Cases cited:

Penfold & Penfold (1980) 114 CLR 311

Latoudis v Casey (1990) 170 CLR 534

Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225

Kennon & Kennon (1997) FLC 92-757

In the Marriage of Norbis (1986) 10 Fam LR 819

Re David Costs (1998) FLC 92-809

Stanford v Stanford [2002] HCA 52

Braithwaite & Braithwaite [2007]FamCA 468

Prantage & Prantage 49 Fam LR 197

Wrenstead & Eades [2016] FamCAFC 46

Applicant: MS VOLPE

Respondent: MR STARK

File Number: PAC 3633 of 2018

Judgment of: Judge Humphreys OAM

Hearing date: 18 March 2019

Date of Last Submission: 18 March 2019

Delivered at: Parramatta

Delivered on: 22 March 2019

REPRESENTATION

Counsel for the Applicant: Ms Druitt

Solicitors for the Applicant: Caldwell Martin & Cox

No Appearance for the Respondent

ORDERS

(1)The Applicant have leave to institute proceedings for property settlement pursuant to s.90SB(c) of the Family Law Act 1975.

(2)The Respondent shall, within 6 weeks from the date of these Orders, do all such acts and things and sign all such deeds, documents and instruments as may be necessary to transfer to the Applicant the whole of his interest in the home situate at and known as Property A (herein referred to as the "Property A Property") in the State of New South Wales and being the whole of the land contained within Certificate of Title Folio Identifier ….

(3)Simultaneously with the transfer referred to in Order 2 above, the Applicant shall do all such acts and things and sign all such deeds, documents and instruments as may be necessary to refinance the existing mortgage to Westpac Banking Corporation secured over the property at Property A in the State of New South Wales out of the parties’ joint names and into the Applicant'ssole name or the name of her nominees and the Applicant shall, from that date, pay and bear as and when they fall due all repayments of principal and interest in relation to the said mortgage and shall and does hereby indemnify the Respondent against any liability for a contribution to it AND IN THIS REGARD the Respondent shall sign all such authorities as may be necessary to give effect to this Order.

(4)From the date of these Orders the Applicant shall be granted exclusive occupation of the Property A Property to the exclusion of the Respondent.

(5)Unless otherwise provided for within these Orders, the Applicant shall be declared to be the sole legal and beneficial owner and shall retain all of all her right title and interest in and to all assets in her name, possession and control, including but not limited to the following:

(a)Business [B];

(b)all cash at bank and moneys invested by her in her sole name;

(c)all furniture and personal effects in her possession;

(d)any superannuation entitlements received by the Applicant and invested by her or on her behalf.

(6)Unless otherwise provided for within these Orders, the Respondent shall be declared to be the sole legal and beneficial owner and shall retain of all of his right, title and interest in and to all assets in his name, possession and control, including but not limited to the following:

(a)property at Property C in the State of New South Wales (herein referred to as the Property C property"), being Folio Identifier … and all associated mortgages and encumbrances held over the Property C property;

(b)all cash at bank and moneys invested by him in his sole name;

(c)all furniture and personal effects in his possession;

(d)any motor vehicle in his possession;

(e)any superannuation entitlements received by the Respondent and invested by him or on his behalf.

(7)That, unless otherwise specified in these Orders, and except for the purpose of enforcing the payment of any money due under these or any subsequent Orders:

(a)each party shall be solely entitled to the exclusion of the other in both law and in equity to:

(i)all property (including choses-in-action) in the possession of such party as at the date of this agreement;

(ii)all insurance policies in relation to which they are the Life Insured.

(b)each party shall be solely liable for and indemnify the other against any liability encumbering any item of property to which that party is entitled pursuant to these Orders.

(i)The parties hereby declare that they are not aware of any liability which either of them has which is a joint or several liability with the other including, but without limiting the generality of the foregoing, in respect of or pursuant to bank, credit or charge accounts, guarantees or as a result of any of the parties’ previous business (if any) or other dealings;

(ii)If it is subsequently found that any such liability as is described in sub clause (i) of this clause exists or arises, the party pursuant to whose business or other dealings such liability arose, shall indemnify the other against any liability to contribute towards any claims, costs, demands, suits, actions, proceedings, orders or judgments whenever arising which may be made, brought against or incurred by the other party in respect thereof.

(8)In the event that either party fails to sign any necessary documents or instruments or to do any acts required or contemplated by these Orders to be done, with such failure continuing for 14 days, then the Registrar of the Federal Circuit Court of Australia shall pursuant to section 106A of the Family Law Act 1975, have the power to execute any documents or instruments in the name of the person who has refused or neglected to sign any necessary document or instrument or to do any act required or contemplated by these Orders.

(9)In accordance with Order 8 of the orders made on 27 September 2018, within 90 days from the date of these orders the Respondent pay the costs of the Applicant in accordance with Schedule 3 of the Family Law Rules 2004 and fixed in the sum of $1,006.

(10)In accordance with Order 6 of the orders made on 27 November 2018, within 90 days from the date of these orders the Respondent pay the costs of the Applicant in accordance with Schedule 1 of the Federal Circuit Court Rules 2001 and fixed in the sum of $1,120.00.

(11)Within 21 days of the date of this order, the Respondent is to pay the Applicant the sum of $2,763.20 being the Respondent’s half share of the costs of the expert valuation report.

IT IS NOTED that publication of this judgment under the pseudonym Volpe & Stark is approved pursuant to s.121(9)(g) of the Family Law Act 1975 (Cth).

FEDERAL CIRCUIT COURT
OF AUSTRALIA
AT PARRAMATTA

PAC 3633 of 2018

MS VOLPE

Applicant

And

MR STARK

Respondent

REASONS FOR JUDGMENT

Introduction

1.Ms Volpe (hereinafter ‘the Applicant’) appears before the Court today seeking leave to proceed on an undefended basis pursuant to section 90SB of the Family Law Act 1975.

2.The Applicant was in a de facto relationship with Mr Stark (hereinafter ‘the Respondent’) and cohabitated with him for a period of 13 months.

3.Prior to the relationship, the Respondent had premises situated at Property C. These premises were subject to a mortgage but were rented to tenants.

4.During the relationship, the Applicant and Respondent purchased property situate at and known as Property A as tenants in common in equal shares for $925,000, subject to a mortgage of $739,500 to Westpac. The Applicant and Respondent occupied the home until they separated.  

5.The Applicant seeks that the Court exercise its jurisdiction to transfer this home to her name solely as the Applicant contributed a total of $224,496.89 (being $92,500 towards a deposit and $131,996.89 due at settlement) to the acquisition of the jointly held property. She seeks further orders that she retain her superannuation and the business known as ‘Business [B]’. The Applicant makes no claim on the Respondent’s premises at Property C or his superannuation.

Issues

6.Should leave be granted pursuant to s 90SB(c) for the Court to enliven its jurisdiction and make orders.

7.Should the proceedings continue on an undefended basis.

8.Should the answer to the two questions above be yes, the Court is then obliged to make an order that is just and equitable in the circumstances.[1]

[1] See Stanford v Stanford [2002] HCA 52.

9.In so doing, the Court is obliged to:

a)Identify the legal and equitable interests in property held by each of the parties and to value the property of the parties; and

b)Consider the contributions of each party pursuant to s 79(4)(a), (b) and (c) of the Act and form a view as to entitlements having regard to the assessment of those contributions; and

c)Consider the relevant matters in s 79(4)(d), (e), (f) and (g) which include the matters in s 75(2) and determine whether any adjustment should be made as a result of this consideration to the contribution based entitlements of the parties; and

d)Consider whether the proposed order arising from the above considerations is just and equitable in the circumstances (see s 79(2) and the approach in Hickey & Hickey & Attorney-General for the Commonwealth [2003] FamCA 395; and

e)Consider the Application for costs made by the Applicant both on a scale rate and on an indemnity basis as claimed.

Documents

10.The Applicant relies on the following documents:

a)Further Amended Initiating Application filed 15 March 2019

b)Amended Financial Statement filed 15 March 2019

c)Affidavit of Applicant filed 22 October 2018

d)Affidavit of Single Expert, Mr D, filed 14 March 2019

e)Two Exhibit Bundles handed up in Court today

f)Affidavit of Solicitor, Laura McGookin filed 15 March 2019

11.The Respondent has filed the following documents:

a)Response to Initiating Application filed 27 September 2018

b)Financial Statement filed 27 September 2018

Chronology

12.I incorporate the chronology as set out in the Applicant’s Outline of Case document:

Date	Event	Source
… 1976	Respondent born (43 years)	W@4
… 1980	Applicant born (38 years)	W@2
… 2016	Parties commenced cohabitation, in rental accommodation at Suburb E. Applicant’s three children resided with the parties. Respondent’s two children lived with the paternal grandmother.	W@6, 27-29
… 2017	Parties purchased Property A as tenants in common in equal share for $925,000. Joint mortgage from Westpac of $739,500, Applicant contributed $263,463.80 to the purchase, Respondent contributed nothing.	W@30-33
May-September 2017	Respondent contributed $26,200 to payment of mortgage and made no other contribution to the acquisition or maintenance of the property.	W@35
September 2017	Parties separated (13 month cohabitation). Applicant obtained ADVO and Respondent forced by the Police to leave the property. Shortly after separation, Respondent withdrew $9,491.50 from the mortgage.	W@10, 45
23.8.2018	Final ADVO for the protection of the Applicant from the Respondent for two years. Respondent convicted of several breaches of the ADVO, use carriage service to menace or harass and possess firearms.	W@11-12

Determination

The s 90SB issue

13.The Applicant seeks leave to proceed pursuant to s 90SB(c) as the de facto relationship was under 2 years and the parties purchased the property at Property A, jointly as tenants in common.

14.The Applicant contends that the Court should exercise its jurisdiction as she contributed the $92,500 deposit and the balance due at settlement of $131,996.89 together with a joint mortgage from Westpac bank of $739,500.

15.The court notes that the Applicant does not wish to sell the premises and seeks to remain a resident of the property which, on her understanding has suffered a significant reduction in value, since acquisition due to a reduction in overall property prices in the Sydney area.

16.Section 90SB reads as follows:

A court may make an order under section 90SE, 90SG or 90SM, or a declaration under section 90SL, in relation to a de facto relationship only if the court is satisfied:

(a) that the period, or the total of the periods, of the de facto relationship is at least 2 years; or…

(c) that:

(i) the party to the de facto relationship who applies for the order or declaration made substantial contributions of a kind mentioned in paragraph 90SM(4) (a), (b) or (c); and

(ii) a failure to make the order or declaration would result in serious injustice to the applicant.

17.Section 90SM(4)(a) reads as follows:

The financial contributions made directly or indirectly by or on behalf of a party to the de facto relationship, or a child of the de facto relationship:

(i) To the acquisition, conservation or improvement of any of the property of the parties to the de facto relationship or either of them; or

(ii) Otherwise in relation to any of that last-mentioned property;

Whether or not that last-mentioned property has, since the making of the contribution, ceased to be the property of the parties to the de facto relationship or either of them

18.As indicated above, it is apparent from the material provided in evidence to the Court that it was the Applicant that provided the majority of the funds towards the purchase of the premises at Property A and that currently, the property is registered to the Applicant and the Respondent as tenants in common.

19.In these circumstances, the Court is satisfied that the requirements of s 90SB is enlivened in that a failure to make an order or declaration would result in serious injustice to the Applicant, who applied for the declarations and has made a substantial contribution.

Should the proceedings be heard on an undefended basis

20.Following the filing of the Application and accompanying affidavit, a Response to the Initiating Application, together with the Financial Statement were filed on 27 September 2018 by the Respondent.

21.The matter was listed for a Case Assessment conference before Registrar Murdoch who made a number of orders including the usual orders for copies of most recent taxation returns, financial statements for the last 3 years and copies of the most recent superannuation statements. A draft joint balance sheet was also ordered and the matter was listed for further directions on 27 November 2018.

22.On 27 November 2018 the Respondent appeared before Judge Obradovic. The Court noted that he had not complied with the orders made by Registrar Murdoch for the filing and serving of his affidavit 7 days prior to that date, and that he had failed to comply with all other orders made by the Registrar, bar Order 1.

23.Her Honour made further orders for the filing and serving of affidavits and other documents. The parties were ordered to attend a Conciliation Conference on 29 January 2019 and listed the matter for further directions on 18 March 2019.

24.On 9 January 2019 Her Honour Judge Obradovic vacated the Conciliation Conference due to the non-compliance of the Respondent to the directions made by Her Honour.

25.The Court is satisfied that the Respondent was aware of the hearing date of 18 March 2019 and that he has not appeared.

26.In all of the circumstances, the Court is reasonably satisfied that it is proper and appropriate for the matter to proceed on the basis of an undefended hearing.

The property held by the parties and appropriate orders

27.The assets and liabilities of the parties are as follows:

ASSETS
Ownership		Description				Applicants value	Respondents value
1	Joint	Property A				880,000	1,374,998
2	Respondent	Property C				730,000	525,000
3	Applicant	Business known as "Business [B]"				NIL
4	Applicant	Savings Commonwealth Bank				1,000
5	Respondent	Savings Commonwealth Bank				NK	1
6	Applicant	Household Furniture & Contents				1,000
7	Respondent	Household Furniture & Contents				NK	500
Total		$        1,612,000	$        1,900,499

ADDBACKS
Ownership		Description				Applicants value	Respondents value
8
9
Total		$                     0	$                    0

LIABILITIES
Ownership		Description				Applicants value		Respondents value
10               10	Joint	Mortgage on Property A property				723,000	723,000
11	Respondent	Mortgage on Property C property				NK	150,000
12	Applicant	Debt owed to Business				2,931
13
Total		$           725,931		$          873,000

SUPERANNUATION
Member		Name of Fund			Type of Interest		Applicants value	Respondents value
14	Applicant	Super Fund F			Accumulation		31,835
15	Respondent	Super Fund G			Accumulation		NK	130,000
Total		$           161,835	$          130,000

NETT TOTAL ASSETS (including Superannuation) $        1,037,904 $        1,157,499

28.The valuations posed by the Applicant as set out above are supported by appraisals by two Real Estate Agents contained on pages 68-69 of the tender bundle of documents, together with valuation of the business known as ‘Business [B]’by Mr D, Principal of … Chartered Accountant dated 5 March 2019. In the absence of any evidence from the Respondent, I am satisfied these represent a reasonable valuation range for the properties and the business.

29.The valuation by the Respondent had been taken from his Financial Statement. No evidence that has been provided to substantiate those valuations.

30.Contained at pages 69 and 70 of the tender bundle of documents are two appraisals by Real Estate agents in respect of the property at Property C, which value the property, from a kerb side inspection, as somewhere between $650,000 and $740,000. These appraisals were arranged by the Applicant.

31.Again, in relation to the amount of the mortgage outstanding on the Property C property, this is unknown in terms of actual evidence and the figure that was inserted of $150,000 has been simply taken from the Respondent’s Financial Statement.

32.In a similar vein, the amount of superannuation held by the Respondent has simply been taken from his Financial Statement.

33.The Applicant contended that in accordance with Norbis,[2] that the assets should be viewed for contributions in three pools. The three pools being the property, the superannuation and the business known as ‘Business [B]’.

[2] In the Marriage of Norbis (1986) 10 Fam LR 819.

34.It is submitted that the first pool relates to the real property, firstly the premises at Property A, which is valued at $880,000 less the mortgage of $723,000, leaving an equity of $157,000.

35.The Applicant contends that she contributed the whole of the deposit and other costs of Property A, and that it was only with the joint borrowing that the Respondent was able to appear on the Title deed.

36.The Applicant contends that the Respondent contributed to the total of 17 payments of $1600 to the mortgage in the five months of occupation prior to separation, a total of $27,200 but such funds were the only contributions the Respondent made to the household whilst the Applicant paid for the Respondent’s dental work, debts and insurances, legal fees, holidays, health cover and more.

37.Further, after separation the Respondent drew down $9491 from the mortgage without the Applicant’s consent.

38.In respect of the property at Property C, based on the kerb side appraisals it is appropriate to value it at $700,000, less a mortgage taken from the financial statement of $150,000, indicating $550,000 in terms of equity.

39.The Applicant contends that she paid mortgage payments in part or in whole for Property C from time to time but that she cannot quantify the total of what she paid, except for the amount of $4,200.

40.The second pool is the business, being ‘Business [B]’. I am reasonably satisfied based on the report from Mr D that it has no value in terms of sale as a going concern and a nil value represents the Applicant’s equity in the business. Further there is a loan owing to the company of $2,931 from the Applicant.

41.The third pool of assets is superannuation. I am satisfied that the Applicant currently has superannuation of $31,835. The Respondent has superannuation of about $130,000, this being based on the disclosure made in his Financial Statement.

42.In terms of contributions and future needs, the Applicant contends that her capital contributions to the purchase of the premises at Property A were overwhelming. Her contributions to Property C cannot now be quantified but were at a minimum of $4,200.

43.The Applicant contends that both parties maintain their own superannuation, and as the Respondent reports significantly greater superannuation, that the Court would consider that in regard to superannuation, that contributions remain separate and that the justice and equity of the matter demand that no orders be made as to superannuation.

44.It was submitted that parties future needs appear to be well addressed by the assets being arranged in the manner that the Applicant seeks, being that she takes over the joint asset being the home at Property A, and refinances the joint liability and that the Respondent retains the Property C property with its liability.

45.It is noted that the parties are 39 years old in respect of the Applicant and 43 years old in respect of the Respondent.

46.Neither party claims to be responsible for the financial support of others according to their statements or that either is in poor health.

47.I am reasonably satisfied that the following adjustments of property will result in a just and equitable outcome to both parties in that it will essentially place them in a position that reflects their assets prior to entry into their short de facto relationship.

In so doing, it is noted that notwithstanding that there is clear evidence before the Court as to family violence perpetrated by the Respondent, no argument has been put forward for a further adjustment taking into account the principles in Kennon & Kennon.[3]

[3] (1997) FLC 92-757.

48.Accordingly the Court proposes as follows:

a)The Respondent takes:

Respondent	Total
Property C	$700,000
-   Mortgage on Property C property	$150,000
Equity	$550,000
+ superannuation Super Fund G	$130,000
Total	$680,000

b)The Applicant takes:

Applicant	Total
Property A	$880,000
-   Mortgage	$723,000
Equity	$157,000
+ Business known as ‘Business [B]’	NIL
+ Super Fund F	$31,835
Total	$188,835

49.This division of assets properly reflects the contributions made by the parties during the short period of their relationship and takes significant account of the assets that each brought into the relationship.

Application for Costs

50.The Applicant, in the Further Amended Initiating Application filed on 18 March 2019 has sought inter alia the following orders with respect to costs:

(5) Within 21 days from the date of these orders the Respondent pay the Applicant the sum of $2,763.20, being the Respondent’s half share of the costs of the expert valuation report.

(6) In accordance with Order 8 of the orders made on 27 September 2018, within 21 days from the date of these orders the Respondent pay the costs of the Applicant in accordance with Schedule 3 of the Family Law Rules 2004 and fixed in the sum of $1,006.

(7) In accordance with Order 6 of the orders made on 27 November 2018, within 21 days from the date of these orders the Respondent pay the costs of the Applicant in accordance with Schedule 1 of the Federal Circuit Court Rules 2001 and fixed in the sum of $1,120.00.

(12)   The Respondent shall pay the Applicant’s costs of and incidental to these proceedings calculated on an indemnity basis.

51.The following is a summary of the relevant law in relation to costs and has been taken from the judgement of Judge Obradovic in the case of Murray(Jnr) and Murray (Snr) [2016] FCCA 2763

52.The starting position with respect to costs is set out at s 117 of the Family Law Act 1975 (Cth) is that subject to s 117(2) each party to the proceedings under the Family Law Act shall bear his or her own costs.

53.The discretion for costs is a broad jurisdiction.

54.The High Court held in Penfold & Penfold[4] that it is necessary for the Court to make a finding of justifying circumstances as an essential preliminary to the making of an order for costs. The Court is not required to specify the circumstances which justify the making of such an order.

[4] (1980) 114 CLR 311.

55.As long as there is an essential preliminary finding that there are justifying circumstances to make a costs order, there is no additional or special onus which the Applicant needs to establish in order for costs. It is not the law that a costs order can only be made in what has been described as a ‘clear case’.[5]

[5] See in general the comments made by the Full Court in Wrenstead & Eades [2016] FamCAFC 46 and in particular where the Full Court approved the comments of the judge below at [103].

56.In Latoudis v Casey[6] the High Court stated as follows:

…in exercising its discretion to award or refuse costs, a court should look at the matter primarily from the perspective of the defendant. To do so conforms to fundamental principles. If one things is clear in the realm of costs, it is that, in criminal as well as civil proceedings, costs are not awarded by way of punishment of an unsuccessful party. They are compensatory in the sense that they are awarded to indemnify the successful party against the expense to which he or she has been put by reason of the legal proceedings”.[7]

[6] (1990) 170 CLR 534.

[7] Referred to in the context of family law proceedings by Judge Kemp in Coggan & Coggan [2012] FMCAfam 984 at [17].

57.In determining what order, if any, should be made under s 117(2) the Court must have regard to the prescriptive but non-exhaustive list of considerations of sub-section (2A).

58.Rules 21.02(2) Federal Circuit Court Rules 2001 provides that in making an order for costs the Court may set the amount of costs; or set the method by which the costs are to be calculated; or refer the costs for taxation under Part 40 of the Federal Court Rules or under Chapter 19 of the Family Law Rules.

Section 117(2A) Factors

59.Section 117(2A) of the Family Law Act provides the factors that the Court in ordering what costs, if any, should have regard to.

60.All relevant matters referred to in s 117(2A) must be taken into account: Re David Costs (1998) FLC 92-809; and Braithwaite & Braithwaite [2007] FamCA 468 at [115].

61.In Fitzgerald (as Child Representative for A (Legal Aid Commissioner of Tasmania) v Fish & Anor (2005) 33 Fam LR 123, the Full Court held that there is nothing to prevent any one factor being the sole determinate for an order of costs to be made.

Financial circumstances of each of the parties: s 117(2A)(a)

62.In the current matter, the Applicant submits that the Respondent has failed to comply with numerous orders, hence the reserve costs and occasioned additional costs by his failure to comply. It is submitted that the Applicant is entitled to costs pursuant to s 117.

63.It is further asserted that the behaviour of the Respondent does reach the standard required by Colgate[8] as affirmed in Prantage v Prantage[9]at paragraph 49 referring to Colgate the majority says:

“His Honour used as examples, the making of allegations of fraud…misconduct that causes loss of time to the Court and to other parties, proceedings commenced or continued for some ulterior motive or in wilful disregard of known facts or clearly established law”

[8] Colgate-Palmolive Company v Cussons Pty Ltd (1993) 46 FCR 225.

[9] Prantage & Prantage 49 Fam LR 197.

64.The only material before the Court in relation to the financial affairs of the Respondent is a Financial Statement filed on 27 September 2018. It notes that the Respondents average total weekly earning is estimated at $600 per week and that he has a total estimated personal expenditure of $300 per week.

65.This income arrives from rent paid by a tenant and child support in the amount of $200. It is noted that additional amounts are paid by others for his benefit amounting to a sum of $500 per week. Whilst it is noted that he is unemployed it appears that he has ongoing income from the rent and has expenses paid by others.

66.The court is satisfied that the Respondent has the capacity to meet a costs order bearing in mind the totality of the orders that have been made in this matter regarding property settlement.

Conduct of the parties in relation to the proceedings

67.The Applicant submits that she has been put to extra and additional costs by way of the conduct of the Respondent in that he failed to comply with orders made by Registrar Murdoch on 27 September 2018 and further orders made on 27 November 2018 and that a conciliation conference with a Registrar listed for 9.15am on 29 January 2018 was vacated as the Respondent failed to comply with the filing directions of the Court as advised by the solicitor for the Applicant in accordance with Order 4 made on 27 November 2018.

68.The Court is reasonably satisfied that the Respondent has failed to comply with orders and as a result the Applicant has been put to additional expense. This conduct of itself might be considered to be sufficient for the purpose of the granting of a costs order.

Whether a party has been wholly unsuccessful: s 117(2A)(e)

69.The only material before the Court from the Respondent was his Response to the Initiating Application filed 27 September 2018. In this he indicated he said he disagreed to orders 1-8 sought in the Initiating Application.

70.It is noted that in his Response, the Respondent sought the property at Property A be sold and that monies leftover be split between himself and the Applicant.

71.The Respondent also made an application for orders for the return of the motor vehicle, which has subsequently been sold, or that the Applicant pay the Respondent as per the receipt of $20,000.

72.The Respondent further sought that the Applicant return all furniture, given this furniture has subsequently been returned.

73.The Respondent sought that the Applicant pay him a sum of $10,000, this being the total of half the monies left in an account held in good faith by the Applicant.

74.In addition, the Respondent also sought an agreed monetary payment from the company the Applicant acquired, that is, Business [B], for ‘the mass of labour hours spent working after hours on projects in the business that have been unpaid’.

75.As the matter proceeded on an undefended basis it is fair to say that the Respondent has been wholly unsuccessful in the orders that the sought.

Offers made & any other matters: s 117(2A)(f) and (g)

76.Section 117(2A)(f) is concerned with written offers. There is no evidence of such an offer being made before the Court.

77.However, the Court notes that the Applicant resisted the relief sought by the Respondent in respect of the totality of the property orders.

Costs orders

78.As a result of the consideration of the above matters and the findings which have been made, the Court finds that in the circumstances of this case, the Court is justified in making an order as to costs, as required by sub-section 117(2).

79.The Court has had particular regard to the finding that the Applicant has been put to additional costs and expense as a result of the Respondent failing to comply with orders made by the Court on two occasions and that in terms of his Response to the orders sought, he has been totally unsuccessful.

80.The question then remains as whether the costs should be ordered on a quantum, or an indemnity basis.

Indemnity Costs

81.The following is again a summary of the relevant law taken from the case of Murray cited above.

82.There is nothing in the Family Law Act which inhibits the making of an order for indemnity costs.[10] However, an order for costs itself is a great departure from the normal standard.[11] Reference was made previously to the passage of Colgate-Palmolive Company v Cussons Pty Ltd[12] stating the position with regards to costs on an indemnity basis is well known:

“…there should be some special or unusual feature in the case to justify the court in departing from the ordinary practice.”

[10] See Prantage & Prantage (2013) FLC 93-544.

[11] See Kohan & Kohan (1993) FLC 92-340.

[12] (1993) 46 FCR 225

83.The principle in Colgate-Palmolive is applicable to matters decided under the Family Law Act and have been applied by this Court, the Family Court and the Full Court of the Family Court in appropriate instances.

84.In the present matter there is nothing in the Applicant’s submissions  which would persuade the Court that an order for indemnity costs is appropriate in the circumstances of this case. Whilst there has been additional cost and expense, and a failure to comply with orders, the matter has ultimately proceeded on an undefended basis.

85.Costs have been sought in respect of two matters, being the reserve costs of orders made by the Registrars.

86.I am satisfied that in respect of the orders filed to be complied with by 27 September, costs will be awarded in the amount of $1006.00 and that costs be awarded in relation to the failure to comply with the orders of 27 November of $1120.00, these being relevant scale costs.

87.The available orders are made by reference to Schedule 1. The total to be paid by the Respondent in respect of Legal costs is $2126.

88.The Court proposes to allow 90 days for the payment of these costs.

89.Further the Respondent should be liable for a one half share of the costs of the expert valuation report undertaken by Mr D. This amounts to $2,763.20. The Court proposes to allow 21 days for the payment of this amount.

90.Accordingly, orders are made as set out at the forefront of these reasons.

I certify that the preceding ninety (90) paragraphs are a true copy of the reasons for judgment of Judge Humphreys

Date: 22 March 2019