WOOTON & HILLIER

[2016] FamCA 965

FAMILY COURT OF AUSTRALIA

WOOTON & HILLIER [2016] FamCA 965

FAMILY LAW – COSTS – Where the matter was finalised on the sixth day of the trial when a consent order was made – Where the wife makes a costs application after protracted litigation about whether a financial agreement is binding and whether the financial agreement should be set aside in any event based upon a history of systemic family violence – Where the wife seeks that the costs order not apply to certain parts of the proceedings where she concedes costs orders are not appropriate – Where the husband opposes any order for costs being made in the wife’s favour – Where in the circumstances of the case the court is entitled to consider making an order for costs notwithstanding that the matter was resolved by a consent order without any determination on the merits –Where it is a weighty consideration that the husband made the concession that the financial agreement was not binding – Where the evidence taken as a whole at the time the consent order was made heavily supports a finding that it was highly likely the wife would have established a course of conduct by the husband which would have been more than sufficient to ensure her success in establishing grounds under s 90K(1)(b) and (e) of the Family Law Act 1975 (Cth) to have the financial agreement set aside – Where aspects of the husband’s conduct in the proceedings weigh in favour of the wife – Where it is just to make an order as to party/party costs as agreed or assessed which order is not to include certain parts of the proceedings.

Family Law Act 1975 (Cth)
Family Law Rules 2004 (Cth)

Australian Securities Commission v Aust-Home Investments Ltd and Others (1993) 116 ALR 523
Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397
Idoport Pty Ltd v National Australia Bank Ltd & Ors, Idoport Pty Ltd v Donald Robert Argus [2007] NSWSC 23
Muldoon & Carlyle (2012) FLC 93-513

Re Minister of Immigration & Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622

APPLICANT: Ms Wooton

RESPONDENT: Mr Hillier

FILE NUMBER: CAC 2423 of 2007

DATE DELIVERED: 11 November 2016

PLACE DELIVERED: Sydney

PLACE HEARD: Sydney

JUDGMENT OF: Watts J

HEARING DATE: 29 August 2016

REPRESENTATION

COUNSEL FOR THE APPLICANT: Mr Kearney, SC

SOLICITOR FOR THE APPLICANT: Pigdon Norgate Family Lawyers

COUNSEL FOR THE RESPONDENT: Mr Campton, SC

SOLICITOR FOR THE RESPONDENT: Milevski Family Lawyers

Orders

1. Subject to these orders, within 28 days the husband pay the wife’s costs of and incidental to the proceedings instituted by the application filed 7 October 2011 on a party/party basis as agreed or assessed.

2. Order 1 will not include the wife’s costs relating to:

   2.1.The application to prevent the wife’s former lawyer from continuing to act for her which was resolved by consent orders on 14 August 2012;

   2.2.The application relating to the disqualification of the Federal Magistrate (as he then was) nor the appeal from that order;

   2.3.Any claim by the wife that the financial agreement signed by the wife on 18 May 2007 should be set aside pursuant to the provisions of s 90K(1)(a) of the Family Law Act 1975 (Cth) including any costs incurred in relation to the preparation of affidavit evidence relevant only to that subsection, the costs of financial investigations and reports of forensic accountants including Mr F and any other expert evidence not relied upon by the wife at the time of the trial;

   2.4.Any work done on behalf of the wife in respect of the husband’s Application in a Case dated 3 April 2012;

   2.5.Any work in respect of parenting issues.

3. I certify that it was reasonable for the wife to engage the senior and junior counsel that she has engaged from time to time.

4. The husband’s cross application for a costs order be dismissed.

5. The application by the husband for costs, which were reserved by way of order 4 made 6 September 2012, be dismissed.

6. Within 28 days the husband pay to the wife 85 per cent of her costs in respect of her application for costs made orally on 17 May 2016 and the husband’s cross application for costs, on a party/party basis to be agreed or assessed.

7. The wife is to forward to Mr G or his legal representatives a copy of these Reasons for Judgment.

IT IS NOTED that publication of this judgment by this Court under the pseudonym Hillier & Wootton has been approved by the Chief Justice pursuant to s 121(9)(g) of the Family Law Act 1975 (Cth).

FAMILY COURT OF AUSTRALIA AT SYDNEY

FILE NUMBER: SYC 1626 of 2012

Ms Wooton

Applicant

And

Mr Hillier

Respondent

REASONS FOR JUDGMENT

INTRODUCTION

1. This is a costs application by the wife after protracted litigation in this court and prior to the transfer of the matter to this court, in the Federal Magistrates Court, about whether a financial agreement is binding and whether the financial agreement should be set aside in any event. The wife’s application to set aside the financial agreement was based upon her assertions of a history of systemic family violence. The matter was resolved by consent orders on the 6^th day of the hearing. At that time, the trial had all but completed except for the balance of the husband’s oral evidence and submissions.

2. In relation to the binding nature of the financial agreement the wife asserted the formal requirements pursuant to s 90G of the Family Law Act 1975 (Cth) (“the Act”) had not been complied with. Had the wife been successful in establishing that, the husband argued that pursuant to s 90G(1A) of the Act, the court should be satisfied that it would be unjust and inequitable if the agreement were not binding on the spouse parties to the agreement (disregarding any changes in circumstances from the time the agreement was made).

3. The wife also sought an order that the financial agreement be set aside on the basis that the agreement was void, voidable or unenforceable or that in respect of the making of the financial agreement, the husband engaged in conduct that was, in all the circumstances, unconscionable (s 90K(1)(b) and (e) of the Act).

APPLICATIONS

1. The costs orders sought by the parties are set out in Schedule 1.

2. The wife seeks costs orders on four alternative basis, namely on an indemnity basis either as a fixed sum or as agreed or assessed or on a party/party basis at a fixed sum or as agreed or assessed. The wife seeks certification for counsel and senior counsel and seeks that the costs order not apply to certain parts of the proceedings where she concedes costs orders are not appropriate.

3. The husband’s primary application is that there be no order for costs or alternatively there be no order for costs in relation to the proceedings in the Federal Magistrates Court (as it then was). If there is an order for costs in the Federal Magistrates Court, the husband makes his own cross application in relation to costs of certain parts of the proceedings in the Federal Magistrates Court. As an alternative to those applications, the husband seeks that all applications for costs be reserved until determination of the s 79 proceedings. The husband opposes an order for indemnity costs and any order fixing the quantum of costs.

BACKGROUND

1. On 18 May 2007 the wife signed a financial agreement in the presence of Mr G, a solicitor engaged by the wife. Mr G witnessed the agreement and signed the certificate of independent legal advice. He did so during a conference, the circumstances of which are more fully set out below, which involved telephone conversations in the wife’s presence with Mr H, the wife’s former family lawyer, and the wife’s mother.

2. On 7 October 2011 the wife filed an Application for Final Orders seeking that a financial agreement entered into between herself and the husband on 21 May 2007 be declared not binding or in the alternative that it be set aside. On 8 February 2012 she filed an Amended Application. On 22 March 2012 the husband filed a Response. The husband sought to maintain the validity and binding nature of the financial agreement as a complete bar to any application by the wife for a property settlement order. He opposed the application of the wife for a declaration that the financial agreement was not binding and the wife’s application to set the agreement aside. The hearing of the application commenced in the Federal Magistrates Court (as it then was) on 17 September 2012. On the second day of the hearing, 18 September 2012, the husband made an oral application for the disqualification of the Federal Magistrate. He refused the application. On 19 September 2012 the husband filed a Notice of Appeal and an application for the proceedings to be stayed. On that day the Federal Magistrate refused the application for a stay but nonetheless adjourned the proceedings until the husband’s appeal was determined. On 15 February 2013 the Full Court allowed an appeal from the Federal Magistrate’s refusal to disqualify himself and remitted the matter for retrial. On 4 March 2013 the proceedings were transferred by the Federal Magistrates Court to the Family Court of Australia.

3. The matter first came into my docket on 9 August 2013. On that day the husband announced that he wished to have a psychiatrist provide an opinion as to matters identified in the notice of grounds of contention relating to the wife’s state of mind when she entered into the agreement. Directions were made aimed at selecting a single expert. Other directions were made in relation to reissuing subpoenas for material that had apparently been destroyed by the Federal Magistrates Court. I noted on that day that the husband had not complied with a direction in respect of disclosure made by Federal Magistrate Neville on 6 September 2012 and I made further directions in respect of financial disclosure. At that time, the wife had engaged Mr F to look at the husband’s financial position at the time the agreement was entered into.

4. On 5 December 2013 a consent order was made to vary the parenting orders. A notation was made in relation to the husband’s provision of financial documentation and the wife’s further request for extensive material. There was a notation that Dr C had been selected by the parties as the single expert but the parties had yet to agree upon a letter of instruction to Dr C. It was also noted that Mr F had not finished his forensic accounting report.

5. When the matter next came before me on 24 February 2014 both lawyers had failed to comply with the previous order to confer and agree upon a letter of instruction to Dr C. Further directions were made in relation to the settling of that letter. The matter was next before me on 21 March 2014 where a further order was made relating to the instruction of Dr C.

6. On 23 June 2014 I noted that it had taken the lawyer for the wife about two months to comply with the order of 21 March 2014 and it had taken the lawyer for the husband about three months to comply with the same order. The result was that the court did not have anything from Dr C. A direction was made that the court should be informed when Dr C had completed his work.

7. Dr C did not finalise his report until 4 August 2015. Dr C himself takes some responsibility for the delay.

8. On 22 October 2015 further directions were made for the preparation of trial and the matter was set down for hearing for five days in Canberra commencing 9 May 2016.

9. On 9 December 2015 the husband filed an Application in a Case seeking that Dr C’s report be struck out. On 21 March 2016 the husband filed an Amended Case Application seeking leave to rely upon a report prepared by Dr B. The interim applications were heard by me on 23 March 2016 and on 4 April 2016 I granted leave for the husband to rely upon Dr B’s report and I made orders for Dr B and Dr C to participate in a joint conference and prepare a joint statement and to give concurrent evidence at the trial.

10. On 29 April 2016 I published provisional rulings in respect of objections both parties had taken to written evidence.

11. On 2 May 2016 further directions were made in preparation for the hearing and the time for the hearing was extended for a further two days in Sydney on 17 and 18 May 2016 in order to facilitate a revised estimate of the length of the trial and the convenience of the expert witnesses.

12. The hearing commenced on 9 May 2016. Most of the time in court over the next six days focused on two areas of the evidence. The first area was the evidence dealing with the circumstances in which the wife was given legal advice prior to her signing the financial agreement and the role that Mr G and Mr H had played in giving that advice. The second area, and what became the main focus of the evidence during the six days of hearing, was the wife’s assertions of a history of systemic family violence and in particular, evidence about a number of specific incidents of family violence, including those at the following times:

    18.1.Mid-2006

    18.2.September 2006

    18.3.October 2006

    18.4.After 2006

    18.5.The first week of February 2007

    18.6.27 February 2007

13. Evidence about the alleged incident of family violence on 27 February 2007 attracted most attention.

14. The hearing indeed proceeded for five days in Canberra. The final hearing continued before me on 17 May 2016 when the experts gave evidence.

15. After the experts had all but concluded their evidence, the parties requested that I make the notation and the consent order set out below. As indicated above, at that time all that then remained was for senior counsel for the wife to complete any cross examination of the husband and if senior counsel for the husband chose to do so, for the husband to be re-examined. That would have concluded the evidence. Both parties would then have made submissions.

16. On 17 May 2016 at the request of the parties, I made a consent order and the notation they requested to finalise the proceedings. I also made a consent order granting leave to the wife pursuant to s 44(3) of the Act to institute proceedings for a property settlement out of time.

17. Also on 17 May 2016 senior counsel for the wife made an oral application for costs on behalf of the wife and that leave was granted. Directions were made in relation to the filing of any further evidence and written submissions (a timetable which was subsequently amended by consent).

ORDERS MADE 17 MAY 2016

1. The order and notation made on 17 May 2016 was as follows:

   Notation:

   A.That having regard to the evidence in these proceedings to date the husband concedes that he is unable to establish compliance with the requirements of s.90G of the Family Law Act and on that basis consents to the following order:

   Order

   1.That the agreement made between the parties on 21 May 2007 does not constitute a financial agreement that is binding on the parties for the purposes of Part VIII of the Family Law Act.

2. It can be seen that the husband settled the matter on the basis that the wife would be successful in her argument in relation to s 90G(1) of the Act and that he would be unsuccessful in relation to the any argument in relation to s 90G(1A) of the Act.

3. This is adversarial litigation. Parties are of course entitled to settle matters on whatever basis they wish between themselves. Once the husband made the concession I made the order. I am mindful that there is an issue in relation to professional negligence in relation to the wife’s lawyer which may or may not have merit. The consent orders do not bind the wife’s lawyer who would in other proceedings be entitled to argue that the husband too easily made the concession in relation to the s 90G(1) issue and even if he had lost on that ground, to argue the husband had a remedy available under s 90G(1A) of the Act.

THE LAW

Subsection 117

1. Subsection 117(1) of the Act provides that subject to ss 117(2) each party shall bear his or her own costs. Subsection 117(2) provides that if the court is of the opinion that there are circumstances to justify it in doing so, the court may make such orders as to costs as the court considers just. Subsection 117(2A) sets out a list of considerations to which the court shall have regard when determining whether or not an order should be made under s 117(2) of the Act.

Costs orders following the making of consent orders

1. Speaking generally of civil cases in other jurisdictions McHugh J in Re Minister of Immigration & Ethnic Affairs; Ex parte Lai Qin (1997) 186 CLR 622 at 624 states:

   In most jurisdictions today, the power to order costs is a discretionary power. Ordinarily, the power is exercised after a hearing on the merits and as a general rule the successful party is entitled to his or her costs. Success in the action or on particular issues is the fact that usually controls the exercise of the discretion. A successful party is prima facie entitled to a costs order. When there has been no hearing on the merits, however, a court is necessarily deprived of the factor that usually determines whether or how it will make a costs order.

   In an appropriate case, a court will make an order for costs even when there has been no hearing on the merits and the moving party no longer wishes to proceed with the action. The court cannot try a hypothetical action between the parties. To do so would burden the parties with the costs of a litigated action which by settlement or extra-curial action they had avoided. In some cases, however, the court may be able to conclude that one of the parties has acted so unreasonably that the other party should obtain the costs of the action.

   (footnotes omitted)

2. McHugh J relied in part on statements made by Hill J in Australian Securities Commission v Aust-Home Investments Ltd and Others (1993) 116 ALR 523 at 530 where having referred to previous cases Hill J set out a number of propositions which included:

   (2) It will rarely, if ever, be appropriate, where there has been no trial on the merits, for a court determining how the costs of the proceeding should be borne to endeavour to determine for itself the case on the merits or, as it might be put, to determine the outcome of a hypothetical trial: Stratford [J T Stratford & Son Ltd v Lindley (No 2) [1969] 1 WLR 1547]. This will particularly be the case where a trial on the merits would involve complex factual matters where credit could be an issue.

   (3) In determining the question of costs it would be appropriate, however, for the court to determine whether the applicant acted reasonably in commencing the proceedings and whether the respondent acted reasonably in defending them (SEQEB) [South East Queensland Electricity Board v Australian Telecommunication [1989] FCA 15].

3. In this case there had been a trial on the merits which had almost concluded. There is no issue of trying a hypothetical action between parties. Complex factual issues and the parties’ credit had been the subject of intense examination. The merits of the respective positions of the parties had been examined by the reading of their written evidence (after objections had been taken to that written evidence) and the hearing of in excess of five days of oral evidence. In the circumstances of this case, the court is entitled to consider making an order for costs notwithstanding that the matter ultimately resolved by way of consent orders and without any determination on the merits, as:

   30.1.The first of the wife’s two contentions was ultimately conceded by the husband; and

   30.2.In respect of the wife’s second contention, as I discuss below, the preponderance of the evidence at the time the consent orders were made, on balance, supported a successful outcome for the wife under s 90K of the Act, if the matter proceeded to a final determination.

STATUTORY CONSIDERATIONS

(a) the financial circumstances of each of the parties to the proceedings

1. The wife estimates that her legal costs to date (excluding legal costs in relation to parenting matters, the husband’s Full Court appeal from the decision of the Federal Magistrate not to disqualify himself and the matter raised in relation to a conflict of interest in respect of the wife’s previous solicitors, Phelps Reid Lawyers) are in the sum of $392,542.

1. The wife’s gross personal exertion income is about $1,660 per week and she asserts her weekly expenses after taking into account government benefits and the payment of child support exceed her weekly income. The wife estimates that her net assets are about $220,000. This estimate is on the basis that she will be wholly responsible for loans to the National Australia Bank in the sum of approximately $495,000 and on the basis that she has a current debt to her mother in the sum of about $480,000.

2. The wife has separated from her current husband and there has been no property settlement order arising from that marriage.

3. The husband says his legal costs to date are in the sum of $453,609. The husband has paid these costs from his income and “from the trust” (a reference to the Hillier Family Trust).

4. The husband places a caveat on the evidence that he has given in this costs hearing in relation to his financial circumstances by saying that his accountant was absent when preparing the affidavit upon which he relies at this hearing.

5. The husband estimates his income to be more than $5,000 per week but asserts that that income is matched by his weekly expenditure. The husband estimates that his personal net worth is in excess of $4 million. Seemingly, in addition, the husband is the appointor and the beneficiary of his family trust (the husband is also the director and secretary of the trustee company for that trust) which the husband asserts has assets of about $2,360,000 (apparently from the ownership of interests in businesses conducted by seven or eight companies which the husband controls).

6. The husband’s financial position is significantly superior to that of the wife’s.

(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 consideration is of no relevance.

(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. The first matter about the conduct of the proceedings to which the wife referred related to the evidence given by Mr G and the assertion that the husband knew what Mr G’s evidence was from an early stage but he waited until 17 May 2016 to make a concession based on Mr G’s evidence.

2. Both senior counsel for the wife and for the husband submitted that by 17 May 2016 the evidence made it clear that Mr G had not been in a position to nor had provided to the wife the advice required by s 90G(1) of the Act, notwithstanding his certification to the contrary.

3. Pausing there, it is clear that that was the basis upon which the matter settled. As I have already said, when the matter settled there were still arguments that may have been put on the husband’s behalf in relation to the s 90G question, particularly arguments relying upon s 90G(1A), in circumstances were Mr H, in conference with Mr G and the wife, gave clear and unambiguous independent legal advice prior to Mr G signing the certificate.

4. Having said that, the parties settled the matter on a particular basis and the wife relies upon the husband’s concession contained in the notation, as the basis for the argument that the husband should have made that concession at the earlier stage.

5. Senior counsel for the husband attempts to justify the fact that the husband did not attempt to make a concession until the sixth day of the hearing by submitting:

   43.1.The provision of a signed certificate is prima facie evidence that relevant advice has been provided;

   43.2.The onus rested on the wife to demonstrate on the evidence that that assumption was inaccurate;

   43.3.The husband concedes that that demonstration was accomplished by the wife upon the conclusion of her evidence and after the evidence of each of the two solicitors (that evidence was completed by lunchtime on the fourth day);

   43.4.Whilst Mr G, the solicitor who signed the wife’s certificate, provided an affidavit to the husband in 2009, he thereafter refused to provide a proof of evidence or any further affidavit to the husband prior to him being called as a witness in the wife’s case; and

   43.5.Mr G was not shaken in cross examination.

6. Senior counsel for the husband then seemingly contradictorily asserts that the wife’s cross examination of Mr G led to unexpected evidence that could not have reasonably been foreseen and the integrity and reliability of Mr G’s oral evidence while initially firm, was significantly eroded in his cross-examination on the part of the wife and that when taken in conjunction with the evidence of Mr H, the import of Mr G’s role in certifying the agreement was cast under a different shadow. Senior counsel for the husband does not particularise what was that unforeseen evidence or erosion of evidence.

7. The wife asserts Mr G’s evidence remained essentially the same as it was in 2009 and consequently the husband could and ought to have made the concession he made on 17 May 2016 at the commencement of the proceedings by the wife in October 2011. Additionally, senior counsel for the wife notes that Mr G’s oral evidence was completed on the third day of the trial and it wasn’t until the sixth day of the trial that the husband made the concession that led to the final order being made.

8. The affidavit which the husband obtained in June 2009 from Mr G sworn on 15 June 2009 provided, amongst other things, the following information:

   46.1.During a conference between Mr G and the wife on 18 May 2007, Mr G witnessed the wife’s signature on the financial agreement and he signed the “certificate of independent legal advice”;

   46.2.The wife brought those documents to the conference;

   46.3.Mr G read the documents;

   46.4.Mr G explained to the wife that the effect of signing the agreement was to create a bar to her making any further claim for a future share of matrimonial assets;

   46.5.Mr G told the wife that he was not able to provide her with advice on the merits of the financial agreement, explaining that he was an accredited business law specialist and that she needed to seek advice from a family law specialist regarding the merits of the agreement;

   46.6.The wife informed Mr G that Mr H (who is very experienced in family law) was her family law solicitor;

   46.7.Mr G got Mr H on the telephone and in the wife’s hearing on speaker phone, Mr H, who had read the agreement and who had refused to sign the certificate, said:

   46.7.1.He had given detailed advice to the wife about her rights;

   46.7.2.He did not believe the outcome provided for in the financial agreement was in the wife’s best interests;

   46.7.3.He thought that the wife was under both physical and psychological duress from the husband who was applying pressure to the wife;

   46.7.4.That the wife should not be making this decision to finalise the matter in the terms of the agreement at that time.

   46.8.Mr G told the wife she should listen to Mr H’s advice, thereby giving the wife the same general advice as Mr H had given her;

   46.9.The wife told Mr G she just wanted the husband off her back and to be able to get on with her life;

   46.10.The wife’s mother was a long standing friend and colleague of Mr G. Concerned about the pressure the wife was under, with the wife’s permission and in her presence, Mr G, subsequent to the telephone conversation with Mr H, rang the wife’s mother on the speaker phone. The wife’s mother said:

   46.10.1.The husband had applied pressure on the wife;

   46.10.2.The wife knew what she was about to do;

   46.10.3.It was not the best option;

   46.10.4.She supported her daughter’s right to make the decision.

   46.11.Mr G then formed the view that the wife was aware of the risks in signing the agreement and he witnessed her signature on the agreement and signed the certificate.

9. Mr G annexed to his affidavit a contemporaneous file note that he made at the conclusion of the conference with the wife.

10. It can be seen from the above summary of Mr G’s 2009 evidence that at no stage did he represent that he had given the wife advice about her rights. In fact he says from the outset he did not. Mr H had done that and Mr G was satisfied that the wife understood what Mr H had told her (without himself knowing all of the details of what he told her). Mr G however did tell the wife the essential effect of the agreement on her rights. Mr G did discuss with the wife what she saw as the advantages of signing the agreement (she did not want the money; she just wanted the husband off her back and to get on with her life). Mr G discussed with the wife the major disadvantage (which was the same as the effect on her rights) namely that signing the agreement operated as a bar against the wife making any application for a property settlement order.  Mr G did give advice to the wife that Mr H was a good adviser, knew what he was doing and she should listen to him. He advised her that she should wait and that there was no rush or hurry to sign the agreement.

11. Mr G, Mr H and the wife’s mother were all cross examined about the circumstances of their involvement in the conference with the wife on 18 May 2007. There were some minor differences in the evidence of those three witnesses about specific words used but those differences were not surprising and of no particular relevance. Whilst that cross examination gave more detail as to what happened at the conference, the fundamental information that the husband had in June 2009 did not change. There were differing versions about who made the arrangement for the wife to see Mr G. That evidence is of no relevance. Questions were asked about the associated parenting plan and child support agreement that the wife also had with her. Mr G confirmed that he did not read or discuss the recitals in the agreement which contained the financial information about assets and liabilities accepting the wife’s assurance (and Mr H’s confirmation) that she was aware of that information. Mr G confirmed that he did not go through the boiler plate provisions of the agreement. Mr G was cross examined about particular recitals and covenants in the agreement and how he advised the wife in relation to those aspects of the agreement. None of that cross examination changes the basic evidence from Mr G that was in the husband’s possession in June 2009.

12. Mr G reiterated that his motivation for involving Mr H in the conference was so he could read the riot act to the wife. He said he encouraged the wife to stay with Mr H and to follow Mr H’s advice. Mr G, in his oral evidence, confirmed his written evidence that he emphasised the finality of the agreement to the wife and the fact that she would not have to be involved in litigation any further. Mr G’s oral evidence also made clear, as did notes that Mr G had actually taken during the conference (as opposed to the note that he made at the end of the conference), that in the conversation with Mr H, Mr H made clear that he thought the wife was giving up something in the order of $3 million. The second note formed part of Exhibit 32. Mr G confirmed in his oral evidence that he got the clear impression from the wife’s mother that the wife needed to be away from the situation that she was in. He said the wife presented as a mature woman who was in control of her faculties and that there was no obvious outward irrationality or agitation except arising from her impatience to get the document signed. Mr G said that because of the amount of money involved he thought there was a “touch of irrationality” about what the wife was doing. That was part of his motivation for involving the wife’s mother in the conference.

13. Having regard to Mr G’s written evidence and his oral evidence I am unable to identify to what senior counsel for the husband might be referring, when he submits that by the end of Mr G’s oral evidence there had been a shift from what the husband knew Mr G was saying in June 2009.

14. The next aspect of the husband’s conduct of the proceedings to which the wife draws attention is that the husband sought and obtained orders for the wife to be examined by a forensic psychiatrist and then sought a further opinion from a second psychiatrist when he was not satisfied with the evidence of the single expert. The evidence of the single expert can be fairly categorised as having been unfavourable to the husband’s case which is why the husband attempted to commission a report from another expert. Dr B indeed maintained that it was outside the bounds of his proper expertise (and of any psychiatrist) to proffer an opinion upon any of the matters arising for determination by the court in the s 90K application. The involvement of both these experts increased the time it took for the case to reach a final hearing and involved costs and other interlocutory applications relating to the expert evidence. The single expert gave evidence significantly in favour of the wife’s assertions in the wife’s s 90K application. Having considered their joint statements and heard the doctors give concurrent evidence, which had all but completed, the evidence of the single expert was significantly more compelling than the evidence of Dr B. Having said that, I accept the submission by senior counsel for the wife that this medical evidence was only of marginal relevance to the issue to be determined under s 90K. The compelling nature of the factual evidence in relation to the husband’s family violence was far more weighty than a retrospective analysis as to what the wife’s state of mind might have been at the time. Inferences are easily able to be drawn as to what her state of mind was at the time of entering into the agreement based upon the facts as disclosed by the testing of the evidence throughout the first five days of the hearing. I accept the husband’s prosecution of the applications relating to expert evidence caused a delay of the proceedings and it did not advance the husband’s case. This aspect of the husband’s conduct of the proceedings weighs in the wife’s favour.

15. The third aspect of the husband’s conduct of the proceedings to which the wife draws attention was the trial was significantly lengthened by the affidavit and oral evidence of the husband. Most of the hearing focussed on the evidence relating to the controversy under s 90K(1)(b) and (e) and senior counsel for the husband concedes that “it is beyond doubt that what might be described as the s 90K evidence in the case canvassed most of the volume of the evidence (at) trial”.

16. The husband at no time conceded the wife’s assertions about a history of systemic family violence. Senior counsel for the husband referred to the wife’s submissions based upon the state of the evidence, at the time the consent orders were made. Senior counsel for the husband made the following submission:

    With respect, it is simply not open to the wife to ground those submissions. No findings were made, nor should they be made, going to the 90K grounds, in circumstances where the evidence was not complete, nor submissions made. It is simply not open for the wife to selectively rely on any alleged shortcomings in the husband’s evidence. Fundamental difficulties will be encountered by the Court in making an assessment in relation to these particular matters in circumstances where the trial was not concluded by way of a defended judgment.

    …

    It is contrary to fundamental notions of justice to ground any discretion to order costs from submissions as to findings of fact as to the nature and content of this evidence, or as to determinations or judgments that have not been made.

17. I do not accept those submissions in the context of this costs hearing. I am able to make findings about the state of the evidence at the time the order which brought the proceedings to an end was made. The wife’s claim under s 90K turned to a significant degree upon whose version of particular events was accepted. As I will now describe, the damage to the husband’s credit was as complete as I have encountered it in any hearing and on balance it was unlikely that any further cross examination, re-examination (if any) or final submissions (notwithstanding how eloquently they were put by senior counsel for the husband) would have made any difference. I do not have to reach a final conclusion about that but simply take into account the state of the evidence at the time the consent orders were made.

The state of the evidence in relation to the husband’s credit when the consent order was made

1. The evidence that I heard relevant to the husband’s credit falls into four categories. Firstly, there were admissions by the husband that statements made on his oath were either false or inaccurate. Secondly, there was other evidence by the husband where he gave two diametrically different versions and on occasion could not say which version of his sworn evidence was true and untrue. Thirdly, there was evidence given by the husband which was inherently unlikely or which the preponderance of other seemingly reliable evidence would indicate was untrue. Fourthly, there was evidence which went towards providing an overall negative assessment of the husband’s credibility.

2. The following are examples which fall into each category (they are by no means the only examples).

Category One - Admissions by the husband he had given false evidence

1. The husband agreed that the evidence contained in paragraph [51] of his affidavit sworn 29 August 2012 (Exhibit 40) to the effect that he had not spoken to the wife “in an aggressive tone” on 27 February 2007, was untrue.

2. The husband agreed in cross examination that he could not maintain the assertion that he had made on his oath that he had not been physically aggressive towards the wife on 27 February 2007.

3. At paragraph [97] of his trial affidavit filed 21 December 2015 the husband says that when the police arrived at the matrimonial home on 27 February 2007 he still had fragments of glass and blood in his hair. The husband agreed that what he said in his affidavit was an embellishment in relation to the injury he had actually sustained.

4. The husband in his written evidence denied that he told the wife in February 2007 that he was going to Sydney to attend rehabilitation. When cross examined about that statement in his trial affidavit that husband agreed that that was a lie on his oath.

5. The husband asserted in his evidence that he was not the person responsible for entries in the notes from I Clinic claiming that they were information given by his brother. When tested, the husband accepted that that evidence was untrue.

6. In oral evidence the husband conceded that what he had said at paragraph [74] of his trial affidavit in respect of his previous cocaine use was untrue.

Category Two - Where the husband gave two mutually incompatible versions

1. In an affidavit sworn by the husband in June 2009 the husband had alleged a physical assault by the wife on him during an incident in mid-2006 after the wife had returned from seeing the Archibald Prize in Sydney. During his oral evidence at trial the husband said there was no physical assault by the wife on him at that time. The husband was unable to say which of the two totally contradictory versions were true.

2. The wife asserted that the husband had attended her home on 6 August 2015. The husband gave evidence that he had not attended the wife’s home at any point in August 2015. That was evidence which directly contradicted his sworn statement in his affidavit in December 2015 where he said in relation to this assertion by the wife “I felt compelled to attend the premise to check on the welfare of the children”. 

3. In relation to the incident on 27 February 2007 the husband gave inconsistent evidence about where he was when the wife was screaming in the backyard. One of his versions given on his oath must have been untrue.

Category Three – Inherently unlikely or seemingly unreliable evidence

1. Having accepted that his evidence that he wasn’t the source of the information contained in the notes from I Clinic was untrue, the husband asserted that the information he gave to I Clinic in relation to his history of drug and alcohol use was him being “ironic and sarcastic”. This part of the husband’s evidence was inherently unlikely. The contemporaneous records kept by I Clinic were likely to have been an accurate representation of what the husband said to them at the time and what the husband said to them at the time was likely to be an accurate reporting by him of his alcohol and drug use in the recent past.

2. The husband said that the note in his GP’s records to the effect that “he presented today admitting that he was an alcoholic” was inaccurate because it was his brother who had told his doctor that, not him. It is inherently unlikely that the doctor would have made that record if it wasn’t the husband, his patient, who had made the admission.

3. Overall the husband’s evidence in relation to his alcohol consumption was entirely unreliable.

4. On occasions the husband directly addressed me giving what appeared to be heartfelt evidence. The low point of these occasions was an occasion when the husband was asked questions about the wife’s assertion that in 2003 he objected to her attending the funeral of a child (who was a twin) of one of her friends who had died five months after birth. The wife attended the funeral anyway. In the husband’s trial affidavit he gave a blanket denial of the wife’s version. However, in his oral evidence he stated that he too had attended the funeral. The husband gave what appeared to be emotionally compelling evidence about his reaction when he was at the funeral: “I don’t know if I’ve ever seen anything as tragic as two little coffins … I definitely felt that that was a tragedy”. I asked the husband why he had not in his written evidence on this topic mentioned he had gone to the funeral. He replied “I did go to the funeral. The caskets were white”. The difficulty with the husband’s heartfelt memory was it was untrue. The first twin had died soon after being born. The twins had passed away five months apart. There were separate funerals for each of the deceased babies. The husband then went on to assert that he had attended the first child’s funeral and might not have seen two coffins. I am satisfied that the husband deliberately set out to impress upon me the vivid nature of his recollection of the two white coffins and in doing so he gave evidence which was untrue.

5. The wife’s sister attended the wife’s home on 28 February 2007. She took photographs, inter alia, of the wife’s scalp depicting injuries which were consistent with the wife’s description of the alleged assault by the husband upon her the day before. The wife’s sister also gave evidence that she observed a two metre high hedge in the backyard of the matrimonial home which had been trampled and had holes in it.

6. The husband accepted the wife’s sister as a witness of truth.

7. I asked the husband whether or not he was saying the wife threw herself into the bushes and he responded “it’s the only way it could have happened”. It is inherently unlikely that the damage that the wife’s sister saw to the bushes was caused by the wife throwing herself in and out of the bushes nor is the husband’s evidence consistent with the wife’s plea for help which was heard by neighbours and prompted a neighbour to telephone the police.

Category Four – The overall impression of the husband’s credibility at the time the consent orders were made

1. Overall, the husband had been a very unsatisfactory witness. There are many examples of occasions during his oral evidence where he was evasive and argumentative. On occasions he declined to answer the most basic question put to him. On more than one occasion the husband protested saying the questions asked of him were unfair. On one of those occasions his senior counsel announced to the court that if he formed the view that a question was unfair he would object to the question being asked.

2. The husband agreed that he had deliberately lied to the police on 27 February 2007 when he told them that the wife had on that occasion drunk two bottles of wine.

3. The husband at one point in his oral evidence asked for a “dictionary” to define the word “abusive”.

4. The wife had alleged that on an occasion in 2006 she had suffered an injury to her vagina as a result of the husband’s violence. The husband made a blanket denial of the assertion by the wife, implying that he had no knowledge of any injury to the wife’s vagina at the time. In his oral evidence the husband conceded that he was aware that the wife had sustained an injury of the nature that she had alleged and said that he had a recollection that the wife had injured herself whilst riding a push bike, an explanation not offered in his written evidence.

The wife’s evidence and credit at the time the consent orders were made

1. Somewhat inconsistently with his submission about the inability to make findings in a costs judgment about the state of the evidence after consent orders were made, senior counsel for the husband asserts that significant concessions were achieved during his cross examination of the wife eroding many of the factual circumstances she relied upon to establish her s 90K case. I do not accept that submission. In stark contrast to the husband’s evidence, the wife gave evidence in a straightforward and persuasive manner. Her evidence had a remarkable resonance with the notes, affidavit evidence and oral evidence of those with whom the wife had dealings during the relevant period including her mother, Ms E, Dr J, Mr K and Mr H.

Conclusion about the evidence relevant to the wife’s s 90K claim when the consent orders were made

1. The significant preponderance of evidence, on balance, at the time the consent order was made was in favour of setting aside of the financial agreement under s 90K(1)(b) and or (e) of the Act.

Other matters about conduct

1. Senior counsel for the husband submits that the court should take into account the substantive and real benefit received by the wife by the husband’s concession on 17 May 2016 that by consent leave be granted pursuant to s 44(3) of the Act. Senior counsel for the husband categorised this as a “significant concession” and “on any view an indulgence”. Clearly the concession made by the husband avoided cost and delay of any further hearing in relation to a s 44(3) application. However, given the findings which, on balance, I was likely to make in relation to the current proceedings, I do not view the husband’s concession in relation to s 44(3) as either significant or an indulgence.

2. The husband asserts that part of the proceedings related to parenting of the children and points to the consent order that was made on 3 December 2015 varying previous parenting orders. I do not know what were the wife’s costs relating to those consent orders, but that aspect of the case was attended to in a summary way during a procedural event which focussed on financial issues. The wife says she has excluded any legal work done in relation to parenting issues from the fixed sum she has claimed. If a fixed sum costs order is not made, any costs order should reflect that concession. 

The husband’s application that no costs order be made in relation to the proceedings in the Federal Magistrates Court

1. The husband argues that he should not be responsible for paying the wife’s costs of what happened in the Federal Magistrates Court, notwithstanding what happened in the Federal Magistrates Court is all part of the proceedings in respect to the one controversy that was finalised by way of the consent order that was made on 17 May 2016.

2. The husband particularly points to two matters relevant to the conduct of those proceedings in the Federal Magistrates Court.

3. Firstly the husband complains that the wife did not comply with an order of the Federal Magistrates Court on 31 January 2012 to particularise to the husband the grounds for relief sought in her application. The husband on 3 April 2012 made an Application in a Case to the Federal Magistrates Court for the wife to particularise the grounds for relief sought in her application. The husband says that the wife provided particulars on 17 August 2012 and subsequently amended and expanded them at the commencement of the trial before the Federal Magistrate on 17 September 2012. The husband asserts that the wife was wholly unsuccessful in opposing his application for relief that was sought in the Application in a Case filed 3 April 2012 (which also included an application that the wife’s then solicitors withdraw from acting for her which they did on 3 August 2012). By way of order 4 made on 6 September 2012 the costs of that Application in a Case was reserved to the trial.

4. The wife asserts that each of the issues identified by the husband in relation to the provision of particulars was dealt with by the consent orders of 14 August 2012. The restraining order was entered into without any determination as to its merits. I have insufficient evidence upon which I could make a costs order in the husband’s favour in relation to his Application in a Case. I accept however that given that a consent order was made that was favourable to the husband, the wife should not receive from the husband costs that she incurred in relation to that Application in a Case.

5. The second basis of opposing an order for the costs of the proceedings in the Federal Magistrates Court is that senior counsel for the husband claims that on the second day of the hearing before the Federal Magistrates Court the wife, at about lunch on the second day of the trial, “opportunistically” responded to matters raised from the bench so as to seek a forensic advantage in the litigation

6. The word opportunistic was a word that Justice May used in her judgment of the Full Court. It was not a word that was adopted by the majority. I do not accept the submission by senior counsel for the husband that the wife was responsible for putting the husband to a prosecution of his appeal because the wife was involved in the process which she “actively grabbed and progressed … to achieve an advantage”.

7. The husband claims that he incurred significant costs in successfully prosecuting the appeal. Both parties were ordered costs certificates valued at $4,000 in relation to the appeal. The issue as to costs in respect of the appeal proceedings were determined by orders of the Full Court of 11 February 2013 and I do not further take into account matters relating to the appeal.

8. The husband claims that he had no active part in the creation of or responsibility for the losses incurred by him arising from the aborted hearing before the Federal Magistrate and arising from the appeal. Whilst that is true when looked at narrowly, the husband does bear ultimate responsibility because had he truthfully acknowledged the circumstances in which the agreement had been entered into a litigant assessing his risk of an adverse result at trial would have assessed those risks as high and he would have not resisted an application to set aside the agreement when it was sought by the wife at the commencement of the proceedings.

9. Senior counsel for the husband also correctly points out that at an early stage of the proceedings the wife proposed s 90K(1)(a) as a ground to set aside the agreement claiming non-disclosure of material matters at the time the she entered into the agreement. The ground in fact was abandoned prior to the matter proceeding to trial. Some of the wife’s costs, as claimed, appear to relate to the s 90K ground including the preparation of affidavits and the costs of financial investigations and reports of forensic accountants and real estate valuers (see for example page 92 of 100 of the wife’s affidavit filed 30 May 2016 is an account from L Valuers (Real Estate Valuers) for a disbursement of $17,403.38). The wife issued a number of subpoenas going to the issue of financial disclosure, by way of example subpoenas filed on 16 August 2012 to St George Bank, to Mr M and to the husband (see orders FM Neville 6 September 2012).

10. The wife contends that the fact that she did not pursue at trial a claim to set aside the agreement under s 90K(1)(a) needs to be considered in the context of the extent of non-compliance by the husband with the process necessary to engage with such a ground. In that regard senior counsel for the wife refers to orders of 9 August 2013 at paragraphs 6, 7, 10 and of 5 December 2013 at paragraph 4. He further refers to the affidavit of Mr F filed on 27 August 2012 which sets out the extent of the information which the husband had refused at that point to provide for completion of such a process.

11. As my discussion of the history of the case management of the matter set out above indicates, the wife at a preliminary stage was still exploring, with the engagement of Mr F, whether or not the husband had made proper disclosure at the time of entering the financial agreement. The husband conceded during the hearing that certain real estate that he had owned was not contained in the financial agreement but claimed he did so because there was no equity in it.

12. I am not in the context of this costs application able to make any determination as to whether or not the reason the wife did not pursue her s 90K(1)(a) claim was because of continuing non-compliance by the husband or because, having gone as far as she could with her inquiries, she decided there was no utility in further pursuing that ground. In those circumstances I find that it is just that the husband should not pay for costs the wife had incurred in attempting to establish that ground and any costs order in the wife’s favour shall exclude that work.

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

1. Senior counsel for the husband submits that there were significant delays occasioned by failures or neglect on the part of the wife to comply with procedural orders resulting in unnecessary costs. As set out above, whilst delay was caused by the failure of the parties to properly and expeditiously comply with case management directions it could not be said that that failure “lay at the feet of the wife” as asserted by senior counsel for the husband. I do not accept the submission that it was the wife’s conduct that led to the matter not coming on for final trial for a period of almost two years after the transfer from the Federal Magistrates Court. As indicated above, Dr C took some of the blame for that and both parties are otherwise responsible for the delay. The other problem with the husband’s submission is there is no evidence that delay led to further costs (except those costs of attending additional case management events by telephone).

2. Whilst both the parties failed to comply with case management directions, overall this consideration has no weight.

(e) whether any party to the proceedings has been wholly unsuccessful in the proceedings

1. Ultimately, and by order of 17 May 2016, the husband was wholly unsuccessful in the position adopted by him in relation to the financial agreement between October 2011 and 17 May 2016.

2. The husband concedes that the consent order made on 17 May 2016 meant that there was an absence of success in his response to the litigation of the wife challenging whether the financial agreement was one that operated to preclude a claim pursuant to Part VIII of the Act grounded from compliance with s 90G of the Act.

3. The wife submits that, without more, the fact that the husband was wholly unsuccessful is sufficient to justify an order for costs as sought by the wife. Not all considerations under s 117(2A) need to be present before an order for costs is made and one consideration can be so overwhelming that a costs order may be justly made. This consideration is indeed a very weighty one.

(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

1. There is no evidence that there were any written offers exchanged between the parties.

(g) such other matters as the court considers relevant

1. The husband submits in the alternative, that no order be made in relation to costs at this stage but that the costs of the proceedings before me be dealt with together with any costs application that might be considered after the final hearing on the substantive issue.

2. Senior counsel for the husband submits that if no adjustive order is made pursuant to section 79 of the Act in favour of the wife at the final trial then the dispute in relation to the financial agreement will have been without utility. There is currently no jointly owned property between the parties. The husband says he intends to argue at final trial that no further property settlement order should be made adjusting property between the parties and the advantage the wife has already received from the financial agreement means that no further adjustment in the wife’s favour is just and equitable.

3. As senior counsel for the wife points out, the husband has provided no evidence that would allow me to make any assessment of any nature as to the likely entitlements of the parties at the final trial. Whilst the husband gives some indication as to what his financial position is in his affidavit (which I have set out above) no complete financial statement was tendered as part of the husband’s evidence in this costs application.

4. The final s 79 proceedings have been listed for hearing before another judge. Having heard this matter over a period of six days and having reviewed material from the Federal Magistrates Court to consider the arguments in this costs application, I find that it’s appropriate that I make a determination in relation to the wife’s costs application rather than deferring it to the ultimate trial judge. The primary reason for reaching that conclusion is that as is obvious from discussions above, evidence going to the s 90K issues significantly turns on evidence relating to the parties respective credit. I have the advantage that the ultimate trial judge would not have, in having now formed views about what, on balance, was a likely outcome in the case. As this costs application significantly turns on an assessment of the evidence I have heard, at the date the consent orders were made, it is just that I determine this costs application now.

5. The costs of the s 79 proceedings are matters that can properly be determined at the conclusion of the s 79 proceedings.

6. The wife’s costs of the current litigation have been funded by her mother to this date. There is an agreement between the wife and her mother in relation to that funding and repayment in relation to that loan. Senior counsel for the husband submits that the terms of that arrangement do not require monies advanced to be repaid now but that they may be repaid (if at all) at the conclusion of the s 79 litigation. I place little weight on that submission. The fact that the wife has an arrangement with her mother about litigation funding is not of significant relevance as to whether or not the husband should be paying the wife’s costs.

INDEMNITY COSTS?

1. The Full Court in Muldoon & Carlyle (2012) FLC 93-513 at paragraph 115 said:

   115. It is beyond doubt that in order to justify an award of indemnity costs, it must be demonstrated that there are exceptional circumstances, such that the usual order for party-party costs should be departed from (Colgate-Palmolive Company v Cussons Pty Limited (1993) 46 FCR 225; Kohan and Kohan (1993) FLC 92-340; Munday v Bowman (1997) FLC 92-784; Yunghanns & Ors v Yunghanns & Ors and Yunghanns (2000) FLC 93-029; Limousin & Limousin (Costs) (2007) 38 Fam LR 478; Fennessy & Gregorian (2009) FLC 93-399; D & D (Costs) (No 2) (2010) FLC 93-435, Stephens v Stephens and Anor (2010) 44 Fam LR 117).

1. In arguing the exceptional nature of this case the wife points to the fact that the husband ought to have known from the commencement of the proceedings that he would not be able to establish the requisite compliance with s 90G(1) nor resist with the wife’s application under s 90K. The wife argues that the presumption that the husband maintained his position throughout the proceedings from 2011 for some ulterior motive or because of a wilful disregard of the known facts arises (see Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (1988) 81 ALR 397).

2. The wife has provided evidence that she entered into retainers with her legal representatives in the terms annexed to her affidavit material and instructed them on the basis of those agreements. She’s given evidence about accounts that have been rendered pursuant to those financial agreements.

3. In addition, the wife submits that the husband’s pursuit of the expert evidence of each of the psychiatrists was in all the circumstances unreasonable and ultimately of at best marginal relevance.

4. Because I am uncertain as to whether or not, had the husband not made the concession that he did, the husband could have established the requisite compliance with s 90G(1) or in the alternative, relied upon s 90G(1A) to obtain a declaration the financial agreement was binding, reliance upon Fountain Selected Meats (Sales) Pty Ltd v International Produce Merchants Pty Ltd (supra) is not available, in respect of that aspect of the case.

5. The more viable argument relates to whether the husband should have known from the outset that the financial agreement was void. I have discussed elsewhere the preponderance of evidence about systemic family violence at the time the consent orders were made. That evidence indicated that the husband, as the perpetrator, would be well aware of the history of that violence. It could be asserted that the husband wilfully disregarded those facts that were known to him when opposing the wife’s application to set aside the agreement.

6. Having said that, I am mindful that:

   112.1.The matter was settled on the basis that the financial agreement was not binding;

   112.2.Given the husband’s concession, the wife did not press her application to have the financial agreement set aside on the basis that it was void or the husband had engaged in conduct that was unconscionable;

   112.3.Although the evidence seemed overwhelming, I had not heard the evidence completed nor final submissions nor had I made final determinations in the matter.

7. For those reasons I have concluded that this is not a case where exceptional circumstances exist that would justify an order for indemnity costs. It is just in this case to make an order as to party/party costs.

FIXED OR ASSESSED?

1. The wife’s primary position is that in the event the wife is successful in obtaining an order for costs the court ought to fix the amount of those costs. Rule 19.18(1) of the Family Law Rules 2004 (Cth) permits the court to adopt that course. Einstein J in Idoport Pty Ltd v National Australia Bank Ltd & Ors, Idoport Pty Ltd v Donald Robert Argus [2007] NSWSC 23 at [9] points to the advantages of fixing costs as a way of avoiding expense, delay and aggravation in protracted litigation arising out of taxation. It requires the court to be confident that the approach taken to an estimate of costs is logical, fair and reasonable and can be appropriately made on the available materials. Whilst this is a broad exercise it is one that must be exercised judicially with care being taken not to overestimate or underestimate the award of the quantum of costs.

2. In this case I have regard to the fact that the parties have already been involved in protracted litigation since 2011 in relation to whether or not the financial agreement would stand as a bar towards the wife pursuing her application for a property settlement order. Both parties have spent an enormous amount of money litigating this issue. It is inevitable that any process of assessment of costs involving the five years of these proceedings would itself involve considerable costs and delay.

3. The wife’s primary application is for the husband to pay the whole of her costs of and incidental to the proceedings. The wife asserts that she has excluded from her calculations any costs paid or payable in relation to any aspect of the proceedings relating to the consent order that was made restraining a previous lawyer who acted for the wife from continuing to act in the case and relating to the husband’s successful appeal from the order of the Federal Magistrate refusing to disqualify himself.

4. The husband submits that the wife’s methodology for excluding these aspects cannot be distilled from her affidavit evidence. The parties invited the court to deal with this costs application on the papers and I intend to do that. As such there can’t be any testing of assertions in submissions that are contested.

5. In response to the husband’s submission in relation to the inability to check that the wife has in fact excluded certain work carried out by her lawyers from her calculations as to costs, the wife points to the fact that she has offered the husband inspection of underlying records and the husband has not sought to avail himself of that opportunity apparently according to his counsel because he anticipates that the wife would not make the documents available.

6. There are however more fundamental difficulties in fixing an amount of costs in this case which include:

   119.1.The wife has provided no detailed analysis by way of provision of itemised accounts on a party/party basis as to what sum she would seek if that order was made;

   119.2.There are a number of parts of her costs which she has not excluded which for reasons set out above, need to be excluded. As indicated, the wife is not entitled to claim costs for work done in relation to issuing subpoenas, obtaining accountant’s reports and any other expert evidence that was not relied upon by her at the time of the trial, nor any work done in respect of the husband’s Application in a Case dated 3 April 2012.

7. Consequently, whilst the advantages of attempting to fix a lump in costs are obvious, I am not in a position to do so and so any order will need to be an order for costs that are agreed or assessed.

CERTIFICATION FOR COUNSEL (AND SENIOR COUNSEL)

1. Pursuant to Rule 19.50 I am prepared to certify for the attendance of counsel (and, where appropriate, senior counsel) on the basis that:

   121.1.The issues in the proceedings warranted the briefing of counsel;

   121.2.The wife sought to retain the same counsel throughout the proceedings notwithstanding he had become senior counsel during the course of the proceedings;

   121.3.The husband had also retained the same counsel throughout the proceedings who had similarly become senior counsel during the proceedings.

CONCLUSION

1. At the time the husband abandoned his opposition to a declaration being made about the binding nature of the financial agreement, the evidence taken as a whole heavily supported an ultimate finding that the wife had established a course of conduct by the husband from at least 2006 of physical and verbal assaults, intimidation and harassment. That history of family violence if established would have been more than sufficient to ensure that the wife was successful in establishing the husband’s conduct towards her had a material effect upon her decision to enter into the agreement and in establishing grounds under s 90K(1)(b) and (e) of the Act to have the financial agreement set aside. The husband had full knowledge about his conduct during 2006 and 2007. In addition, the wife’s evidence and that of her supporting witnesses together with what was in the subpoenaed documents was well known to the husband from early in the proceedings.

2. I am less confident that the wife would have succeeded on the basis of the concessions that the husband ultimately made particularly given the remedy contained in s 90G(1A) that was available to the husband. Having said that, it is indeed a weighty consideration that the husband made the concession that he did in respect of the s 90G ground.

3. I conclude that subject to certain exceptions which have been referred to already, the wife should be entitled to an order for her costs in respect of and incidental to proceedings instituted by her by way of application filed 7 October 2011 on a party/party basis to be agreed or assessed.

COSTS OF THE PRESENT APPLICATION

1. The wife seeks that an order be made in relation to the present application for costs. The husband’s primary position was that he opposed any order being made in favour of the wife for costs. The husband was wholly unsuccessful in relation to that application. Ultimately the wife has had a costs order made in her favour, although not entirely upon the basis of any of her applications given the costs of certain legal work that has been excluded from the order. The wife should have a costs order in her favour of 85 per cent in relation to this application on a party/party basis to be agreed or assessed. 

PROVISION OF THESE REASONS TO MR G

1. Because of the terms upon which the matter was resolved on 17 May 2016; Mr G’s involvement as a witness in the proceedings and the notifications that Mr G has received in relation to potential professional negligence claims against him by both the wife and the husband, it is appropriate for Mr G to be made aware of what I have said in these Reasons and the wife is to forward to Mr G (or his legal representative) a copy of these Reasons.

I certify that the preceding one hundred and twenty six (126) paragraphs are a true copy of the reasons for judgment of the Honourable Justice Watts delivered on 11 November 2016.

Associate:

Date: 11.11.16 

SCHEDULE 1

Orders sought by the wife

1. Within 28 days the husband pay the wife’s costs of and incidental to the proceedings instituted by application filed on the 7 October 2011, including but not limited to the costs of the hearing and costs of senior counsel:

   1.1.On an indemnity basis, and fixed pursuant to rule 19.18(1) Family Law Rules 2004 in the sum of $392,542.22

   1.2.Alternatively, on an indemnity basis as agreed or assessed

   1.3.Alternatively, on a party/party basis and fixed pursuant to rule 19.18(1) Family Law Rules 2004 in the sum of $392,542.22

   1.4.Alternatively, on a party/party basis as agreed or assessed

2. Certify for counsel (senior counsel where applicable)

3. The wife’s application does not include any of her costs relating to the application to prevent her former lawyer from continuing to act for her which was resolved by consent orders nor the application relating to the disqualification of the Federal Magistrate (as he then was) nor the appeal from that order.

Orders sought by the husband

1. That there be no order as to costs.

2. That the costs of the husband of and incidental to the proceedings before the Federal Magistrates Court in Canberra from the date of initiation of those proceedings by way of application filed on 7 October 2011, until the date those proceedings were transferred on 4 March 2013 including but not limited to the husband’s costs of and incidental to the husband’s Application in a Case filed in the Federal Circuit Court in Canberra on 3 April 2012 (which the husband’s submissions say were reserved to the trial by way of order 4 made 6 September 2012).

3. The husband does not press order 2 as sought if the wife’s application for costs so far as it relates to costs of and incidental to the proceedings in the Federal Circuit Court are dismissed.

4. By way of further alternative (in the event that previous orders sought are unsuccessful) both parties applications for costs be reserved until the determination of the s 79 proceedings.

5. By way of further alternative if none of the preceding orders are made an order as to costs be made in favour of the wife on a party/party basis as agreed or assessed, at such proportion expressed as a percentage of the proceedings conducted only in the Family Court (and not those in the Federal Circuit Court) and an order as to costs be made in favour of the husband as sought on a party/party basis, and that each such order for costs, when the quantum of each is agreed or assessed, be the subject of set off dependent upon quantum, one against the other.

6. The husband opposes an order for indemnity costs and opposes any fixing of the quantum of costs.