Wellings & Wellings (Costs) - [2009] FamCAFC 102

FAMILY COURT OF AUSTRALIA

WELLINGS & WELLINGS (COSTS)

[2009] FamCAFC 102

FAMILY LAW – LEAVE APPLICATION – Application for an extension of time in which to file submissions with respect to the costs of an appeal – Submissions filed out of time – Where practitioner seeking leave had failed to properly explain the delay – Where there was merit in the submissions as to costs of the appeal – Where the respondent was prejudiced arising from the delay

FAMILY LAW - LEAVE APPLICATION – Granted extension of time to file submissions as to the costs of the appeal

FAMILY LAW - COSTS OF LEAVE APPLICATION – Indemnity costs sought by respondent on the basis that the leave application could have been avoided – Unnecessary delay and expense caused by the appellants solicitors

FAMILY LAW - COSTS OF LEAVE APPLICATION – Appellant to pay the respondent costs of the leave application on an indemnity basis

FAMILY LAW - COSTS OF APPEAL – Appellant granted a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 – Respondent granted a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981

Gallo v Dawson (1990) 93 ALR 479

Family Law Act 1975 (Cth), s 117(2)
Federal Proceedings (Costs) Act 1981, s 6, 9

APPLICANT:

MR WELLINGS

RESPONDENT:

MRS WELLINGS

APPEAL NUMBER:

2007

FILE NUMBER:

BRM

5013

2006

DATE DELIVERED:

9 June 2009

PLACE DELIVERED:

Brisbane

PLACE HEARD:

Brisbane

JUDGMENT OF:

May J

HEARING DATE:

9 June 2009

REPRESENTATION

COUNSEL FOR THE APPLICANT:

Mr Baston

SOLICITOR FOR THE APPLICANT:

KL King & Associates

SOLICITOR FOR THE RESPONDENT:

Collas Moro & Ross

Orders

LEAVE APPLICATION

IT IS ORDERED:-

The appellant be granted an extension of time to file a costs submission in relation to the appeal.
The appellant pay the respondents costs of and incidental to the application for leave on an indemnity basis within 28 days, failing agreement to be assessed.

COSTS APPLICATION

IT IS ORDERED:-

The Court grants to the appellant a costs certificate pursuant to the provisions of s 9 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant in respect of the costs incurred by the appellant in relation to the appeal against the property orders.
The Court grants to the respondent a costs certificate pursuant to the provisions of s 6 of the Federal Proceedings (Costs) Act 1981 being a certificate that, in the opinion of the Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent in respect of the costs incurred by the respondent in relation to the appeal against the property orders.

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

IN THE APPELLATE JURISDICTION OF THE FAMILY COURT OF AUSTRALIA AT BRISBANE

FILE NUMBER: NA 57 of 2007

MR WELLINGS

Applicant

And

MRS WELLINGS

Respondent

REASONS FOR JUDGMENT

LEAVE APPLICATION

An application was filed on 7 April 2009 by the husband where he asked that the Court grant an extension of time for him to file a submission in support of a costs application. This was necessary because an order made by me asking that such written submissions be filed within a certain time was not complied with. The wife opposes such leave being granted.
The background to the matter is that the judgment was delivered on 8 December 2008. The husband was successful in the appeal and the wife was ordered to repay to the husband the sum of $38,903. It was further ordered that the husband file written submissions within 21 days and the respondent then file submissions in response within a further 21 days. As I mentioned, the husband failed to comply. An attempt was made to file those submissions almost a month late on 22 January, this year.
I now have an affidavit from the husband, Mr Wellings, which really is more of an affidavit from his solicitor, one would have to observe, and it is designed, I imagine, to deal with an important matter in this case and that is the reason for the delay.
It was said in this affidavit that although the solicitor attended at the delivery of the judgment she was very unwell. I also have an affidavit from Ms King, the solicitor filed by leave today, which says the same thing. She apparently had some surgery to have her gall bladder removed on 6 December. She left hospital a day or so later and says she was unwell throughout most of December.
Ms King wanted counsel who had appeared in the appeal, Mr Galloway, to prepare the submissions. It seems that some time after the judgment was delivered in late December the solicitor ascertained that Mr Galloway would be away but could prepare the submissions in early January.
If Ms King had forgotten about the order she was certainly reminded before the time expired by two letters written by the solicitors for the wife on 8 December 2008 and 23 December 2008, letters that she did not include in her affidavit. In the second letter Mr Ross wrote:
We note that your client's submissions as to costs of the appeal are due to be filed and served by 29 December 2008. We look forward to receipt of same.
There were no submissions filed with the Court or provided to Mr Ross, rather there was a letter written weeks later on 6 January 2008 which ultimately said this:
Should you not consent to this extension we will correspond directly with Justice May’s associate to obtain same.
As I have already remarked to Mr Baston, counsel who today appears for the husband, and unfortunately in the absence of Ms King, this seems to be an extraordinary letter to write to a colleague and extraordinarily arrogant view of how one might attend to the failure to comply with orders already made by the Court.
In this letter it was suggested that by 16 December they might obtain counsel's instructions. Mr Ross replied to that letter on 6 January 2009, inquiring whether or not the solicitor meant that they were seeking an extension until 16 January, and not surprisingly saying:
We ask why an extension was not requested after the Orders issued on 8 December 2008 and before the time for filing your client’s submissions expired?
Ms King then wrote on 7 January 2009 about mostly other matters, and said that they had confirmed that they were asking for an extension of time until 16 January 2008 and referred then to counsel being absent. No doubt the solicitor meant to refer to 2009.
On 12 January 2009 a letter was written by Ms King referring to the fact that counsel was apparently completing the client's submissions. The submissions were not sent until 22 January 2009.
It can be seen that there really is very little that can be said about the delay other than in December Ms King was unwell. Then, that Mr Galloway, unsurprisingly, as many people take holidays at that time of year, was away, but there is still considerable delay in attending to this matter and properly so in relation to another colleague, and certainly in relation to the Court. As I understand it, there was no letter written to the Court asking for an extension of time or providing some reason as to delay other than ultimately, as we know, now some many months after the event, on 7 April 2009 an application being filed asking for leave out of time.
As to the question of merit, I do have attached to the affidavit, to which there has been no objection, the submissions made on behalf of the appellant, the applicant in these proceedings, pointing out two matters: first that the orders provided some considerable impact in relation to the percentage of the pool in the sense that it provided a differential of $319,777, and secondly, that the wife, it is submitted, has an ability to meet the costs order.
As I have already said, the respondent resists leave being granted, in particular submitting that there has not been an adequate explanation of the delay and by reference to the correspondence. The main point really is the lack of action on behalf of the solicitor for the appellant until 7 April 2009 when the application was finally filed.
It is useful to refer to Gallo v Dawson (1990) 93 ALR 479. Mr Baston submitted that this case is not in the same category as other leave applications, which is no doubt correct. This is an application for leave where one party has failed to file submissions in relation to costs; hardly the most concerning of all leave applications. But it is worth remembering what McHugh J said in that case, which was (at 480):
The grant of an extension of time is not automatic. … The discretion to extend time is given for the sole purpose of enabling the court or justice to do justice between the parties.
In this case it must be said that it would be inappropriate to shut the husband out of an opportunity to seek an order for costs against the wife, or alternatively, as has been quite properly raised by the solicitor for the wife, perhaps seek an order for a certificate, but the conduct of the solicitor for the appellant is really quite concerning.
Section 117 of the Family Law Act provides that subject to sub-section (2) each party shall bear their own costs. It is necessary, therefore, for there to be circumstances that would justify an order for costs and one can see in considering the question of the likelihood of the application for costs being successful, as the husband was the successful appellant, there is some possibility that he might succeed.
Despite the most unfortunate circumstances to which I have already made reference, it seems to me that leave should be granted in this case. However, Mr Ross asks for the costs of responding to the application based on, obviously enough, first, that there was no compliance with the order, and then the history to which I have referred in some detail.
In addition, again acting quite properly, on 3 June 2009, Mr Ross wrote to the solicitors for the husband saying this:
We refer to your client's Application in the Appeal seeking an extension of time for filing his submissions as to costs out of time.
There is ample authority requiring that your client establish that:-
(1) There is an adequate reason(s) to explain the delay;
(2) There is a substantial issue to be raised and prospects of success;
(3) That no hardship, injustice, or prejudice will be suffered by our client as a result of the extension being granted.
Those circumstances do not exist here. Accordingly, the application is liable to be dismissed. As a means of disposing of the application now without further costs, our client offers that your client discontinue his application immediately. If not acceptable and your client persists with his application, our client will seek her costs pursuant to rule 1.14(3) Family Law Rules 2004 in any event.
It is indeed unusual to make an order for indemnity costs; however the Court has an obligation to consider matter such as this very seriously, especially when an order of the Court has largely been ignored. It could not for a moment be said that the client is responsible. It seems, as Ms King perhaps to some extent acknowledges in the two affidavits, it was due to her not attending to the matter. However, nor should the wife be put to the substantial costs that have obviously been incurred. Her solicitor attends today and these costs could have been avoided.
In my view, this is one of those cases that can be described as extraordinary and an order for indemnity costs should be made. How those costs are met as between the solicitor and her own client is a matter for them.

COSTS APPLICATION

I have the written submissions of each party in relation to the costs arising from the appeal heard by me. The judgment, as I have mentioned, was delivered on 8 December 2008.
The submissions on behalf of the husband refer, of course, to the result being that the appeal was successful and particularly pointing out that at trial the wife obtained orders that she have property and money to the extent of 39 per cent of the pool but on appeal she received 33 per cent. The difference, $319,777, is on any view substantial as it was said in the submission.
It was argued that the result of the appeal should be for the purpose of s 117 determinative and an order for costs in relation to the appeal should be made. Reference was also made to the financial position of each of the parties. It was said that the wife has a unit, a motor vehicle, had received $100,000 by way of partial property settlement and some cash and that the parties were supporting their children equally.
The submissions on behalf of the wife argue that there should be no order as to costs other than an order under the Appeal Costs Fund. It was submitted that although the appeal was successful the appellant asked that the percentage awarded to the respondent should have been 20 per cent while the re-exercise of discretion was 33 per cent. It was also submitted, correctly, that there were some grounds of appeal that were not successful and consequently it is asked that there be a certificate.
As I have already mentioned, s 117 of the Act provides that subject to sub-section (2) each party shall bear their own costs unless there are some features that would justify an order for costs being made.
In relation to an order as against the wife the matters to which reference has been made are these: first, that the husband succeeded on the appeal and it is necessary to look to what extent he succeeded, together with what the real value of that success was. Then it is necessary to look at the financial positions of each party.
There was nothing about the conduct of the appeal which would attract an order for costs. I understand from the submissions there were no offers to resolve the appeal from either party which I should take into account, and so the only matter really is the result of the appeal.
In my view, this is not a case where an order should be made as against the wife for costs. It can be seen from my judgment that although some grounds were unsuccessful I was of the view that the appeal should be allowed because of his Honour's assessment of contribution which was outside the range. Therefore, the proper result should be in relation to costs that each party should receive a certificate.

I certify that the preceding twenty nine (29) paragraphs are a true copy of the reasons for judgment of the Honourable Justice May

Associate:

Date: 17 June 2009