Wrensted & Eades - [2016] FamCAFC 46

FAMILY COURT OF AUSTRALIA

WRENSTED & EADES

[2016] FamCAFC 46

FAMILY LAW – APPEAL – COSTS – Where the appellant’s pre-trial conduct plainly justified an order for costs in favour of the respondent – Where there was no failure by the trial judge to abide by the principles in Div 12A of Part VIII of the Family Law Act 1975 (Cth) in considering the appellant’s pre-trial conduct – Where it was proper for the trial judge to take into account that the appellant was wholly unsuccessful when making an order for costs in favour of the respondent – Where there was no error in the trial judge considering the respondent’s offer to settle in circumstances where it could not be said that such an offer was unreasonable – Where to apply a distinction between categories of family law cases in exercising the wide discretion to order costs would place a fetter on that discretion which has no legislative basis – Where to the extent that the majority in Hawkins & Roe [2012] FamCAFC 77 suggests that certain features need to be present in a parenting dispute (as distinct for example from a property dispute) before a costs order can be made, this court respectfully disagrees – Where the trial judge was justified in making an order for costs against the appellant extending to the entirety of the proceedings – Where the trial judge’s decision was not unreasonable or plainly unjust – Appeal dismissed.

FAMILY LAW – APPEAL – COSTS – Where there were plainly circumstances justifying an order for costs – Where the appellant was wholly unsuccessful – Costs granted.

Family Law Act 1975 (Cth) – Part VII, Div 12A

F Firm & Ruane and Ors (2014) FLC 93-611
Gett & Tabet (2009) ALR 504
Green v The Queen; Quinn v The Queen (2011) 244 CLR 462
Hawkins & Roe [2012] FamCAFC 77
Nguyen v Nguyen 169 CLR 245
Rice and Asplund (1979) FLC 90-725

APPELLANT:

Mr Wrensted

RESPONDENT:

Ms Eades

FILE NUMBER:

PTW

3045

2012

APPEAL NUMBER:

2014

DATE DELIVERED:

4 April 2016

PLACE DELIVERED:

Adelaide

PLACE HEARD:

Perth

JUDGMENT OF:

Bryant CJ, Finn & Strickland JJ

HEARING DATE:

26 October 2015

LOWER COURT JURISDICTION:

Family Court of Western Australia

LOWER COURT JUDGMENT DATE:

26 September 2014

LOWER COURT MNC:

[2014] FCWA 64

REPRESENTATION

COUNSEL FOR THE APPELLANT:

Mr Berry SC

SOLICITOR FOR THE APPELLANT:

Bannerman Solicitors

COUNSEL FOR THE RESPONDENT:

Mr Hedges

SOLICITOR FOR THE RESPONDENT:

Cullen Babington Macleod

Orders

Order made on 26 October 2015

The father have leave to amend Ground 5 of his amended grounds of appeal.

Orders made 4 April 2016

The appeal be dismissed.
The father pay the mother’s costs of and incidental to the appeal, such costs in default of agreement to be as assessed on a party/party basis.

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

THE FULL COURT OF THE FAMILY COURT OF AUSTRALIA AT PERTH

Appeal Number: WA 26 of 2014
File Number: PTW 3045 of 2012

Mr Wrensted

Appellant

And

Ms Eades

Respondent

REASONS FOR JUDGMENT

Introduction

By Notice of Appeal (WA 26/2014) filed on 23 October 2014, Mr Wrensted (“the father”) appeals against costs orders made by Walters J on 26 September 2014.
The orders provided that the father pay the mother’s costs of and incidental to the parenting proceedings on a party / party basis, such costs in the absence of an agreement as to quantum, to be as assessed by a Registrar.
The appeal is opposed by Ms Eades (“the mother”).

Background

The parties were married in late 2005, and they separated in January 2010.
There are two children of the marriage; Child A (born in 2003) and Child B (born in 2010) (collectively, “the children”).
On 2 October 2013 the mother filed an application in the Family Court of Western Australia seeking orders which would allow her to relocate the children to Thailand for the period commencing in February 2014 and concluding on 1 August 2015.
On 6 February 2014 his Honour ordered that the mother be permitted to relocate for the period sought on 5 March 2014 he delivered his reasons for judgment. Orders were made in relation to the filing of submissions regarding the issue of costs.
The mother filed her written submissions in relation to costs and her financial statement on 2 April 2014.
The father filed his written submissions in response to the mother’s submissions and his financial statement on 29 April 2014.
On 26 September 2014 his Honour made orders and delivered his reasons for judgment in relation to costs.

Reasons for judgment delivered 26 September 2014

Generally, when an order for costs is under challenge, it is unnecessary for us to record in detail a trial judge’s reasons, but here the length of the reasons has allowed for wide-ranging grounds of appeal, and in order to address those grounds it is essential that we adequately identify the relevant parts of his Honour’s reasons.
His Honour commenced his reasons for judgment by providing the procedural background to the application before the court (at [1] – [9]). His Honour noted that in her application the mother sought that the father pay her costs on an indemnity basis, or in the alternative, on a solicitor/client or party/party basis plus 50 per cent. His Honour recorded that in response the father sought that each party pay their own costs (at [10] – [11]).
His Honour then turned to the law applicable to determining costs applications.
His Honour referred to s 117 of the Family Law Act 1975 (Cth) (“the Act”), and noted that a “trial judge has a very broad discretion in costs matters” (at [13]).
In relation to this discretion, his Honour opined that it is “not the law that a costs order can only be made in what has been described as a ‘clear case’”. Rather, his Honour noted that 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 on an applicant for an order for costs”. Thus, his Honour referred to the general rule in s 117(1) of the Act, and the qualification to this general rule in s 117(2) and cited Penfold & Penfold (1980) 144 CLR 311. His Honour then quoted s 117(2) and s 117(2A) of the Act (at [15] – [16]).
Having set out the considerations under s 117(2A), his Honour explained that the “weight to be given to the various factors” is “a matter for the trial judge” providing each factor is “taken into account and balanced when considering whether the overall circumstances justify the making of a costs order” However, his Honour noted that nothing prevents “any of the factors being the sole foundation for an order for costs”. His Honour cited I and I (No 2) (1995) FLC 92-625, Hitch & Hitch (2012) 47 Fam LR 603, Fitzgerald (as child representative for A (Legal Aid Commission of Tasmania)) v Fish and Another (2005) 191 FLR 294 at 130 in this regard (at [17]).
His Honour then noted that a “disparity in financial resources between parties to family law litigation can sometimes justify an order for costs in favour of the party with fewer financial resources”, but that “the apparent inability of a party to pay costs is not a bar to a costs order being made” in certain circumstances (see Marinko & Marinko (1983) FLC 91-307; Cross v Beaumont (2008) 39 Fam LR 389; and Hitch & Hitch) (at [18]).
Further, his Honour recorded that there was “nothing in the provisions of s 117 to justify any difference in approach to the question of costs in parenting cases”. His Honour set out a number of circumstances where a costs order may be made in a parenting matter, but explained that there were “not necessarily pre-requisites”. Rather, his Honour noted that “all relevant matters referred to in s 117(2A) must be taken into account” (see I & I (No 2); Re David Costs (1998) FLC 92-809; and Braithwaite & Braithwaite [2007] FamCA 468 at [115]) (at [19]).
Next, his Honour analysed the Full Court decision in Hawkins & Roe [2012] FamCAFC 77, particularly at [72] per May and Ainslie-Wallace JJ (at [20] – [21]). Having considered the conclusion of the majority in this case, his Honour opined that the reasoning in [141] – [148] of the judgment was “difficult to follow” and “inconsistent with previous authority” (at [22]). For example, his Honour noted the majority’s reference to “serious conduct” as “more predictably (attracting) the making of a costs order” in parenting proceedings, for which Edgar v Halle (No 2) [2010] FamCA 260 was cited. However, his Honour considered that this case was “no more than a single example of a costs order being made in circumstances where one party made numerous false allegations and statements in the course of the proceedings, motivated by the antipathy towards the other party”, and that in any case, “such behaviour was not the sole ground for the making of the costs order”. In fact, his Honour considered this case to be a “less than helpful example” in light of the fact that it was decided on the basis of s 117AB, which was later repealed (at [22]).
Also referred to in Hawkins & Roe was the Full Court decision in Cross & Beaumont “as authority for the proposition that ‘financial incapacity to pay a costs order is not a barrier where the conduct of the party may warrant the making of such an order’”. This decision was made in the context of a property settlement which did not involve parenting issues. His Honour noted that the Full Court in Hawkins & Roe quoted from this decision at [60], but his Honour set out [59] – [60] to “help to elucidate the quotation” (at [23] – [24]).
Subsequently, his Honour quoted the conclusion of the Full Court in [146] – [147] of Hawkins & Roe, but opined that “these paragraphs [appeared] to be unsupported by authority”, including I & I (No 2) which was referred to in Hawkins & Roe “in a different context”. His Honour then recorded (at [28]):
…Even if I am wrong in these observations, it is apparent that there is an internal inconsistency in the majority's approach: if the categories of occasions when costs may be ordered are unlimited, then it is clearly impermissible to attempt to limit them by suggesting that, before a costs order can be made in a parenting dispute, the case "should" have certain particular features. The inference from the majority's comments seems to be that the "particular features" that a parenting case "should" have before a costs order can be made comprise the following:
a)an allegation or finding of dishonesty;
b)adverse findings about a party's conduct of his/her case at trial;
c)a complete absence of preparedness to compromise in the face of unambiguous expert evidence;
d)the making of false allegations; or
e)where one party is clearly motivated by self-interest rather than the best interests of a child.
His Honour then quoted [14] of the majority decision in Hawkins & Roe and noted that to “the extent that the majority might be perceived to be suggesting … that the discretion of a judicial officer at first instance to order costs should be fettered by rules or guidelines such as those listed above … the exercise of such a discretion cannot be so fettered” (at [29] – [30]).
His Honour then explained Thackray J’s “discomfort” with the approach of the majority in this regard, and quoted his Honour’s comments in Hawkins & Roe at [162]. In light of this quote, his Honour recorded that any statement suggesting the default position is not often displaced in parenting proceedings was merely a statement of fact and could not “mandate the setting of a higher standard or threshold test to be satisfied before a judicial officer at first instance can make an order for costs in parenting cases”. His Honour opined that this would be in “direct conflict with the costs provisions of [the Act]”.
In any case, his Honour considered that the distinction between parenting and property cases, justified on the basis that parents should be able to “put their case in seeking orders which they believe to be in the best interests of their children”, does not exist. The trial judge was of the view that such distinction fails to recognise that to “some litigants, their and their children’s financial well-being is at least as important as parenting issues”, and in many cases, financial and parenting disputes “are intertwined”. Similarly, his Honour considered it “doubtful that the potential for an adverse costs order would be any more likely to dissuade or prevent a litigant from putting his/her case in a parenting dispute than in a property dispute” (at [33]).
In relation to the success of the parties in the proceedings, the trial judge again referred to the “breadth of the judicial officer’s discretion” regarding costs, and found that, though the lack of success of a party in proceedings is a factor to be taken into account, it has never been the case that “the simple fact that one party has been successful and the other has not should necessarily and inevitably lead to the making of an order for costs in favour of the successful party” (at [34]).
Particularly, his Honour agreed with Thackray J’s comments in Hawkins & Roe that a party’s submissions, though wholly unsuccessful and relevant under s 117(2A), are not always “without merit”. In fact, his Honour opined that “the breadth of the judicial officer’s discretion in relation to costs allows for argument regarding the comparative merits of each party’s case and the reasonableness of pursuing the same” (at [35]).
In light of this discussion, the trial judge opined (at [36]):
It follows from the above that I propose to bear in mind that the general rule (to the effect that each party should bear his/her own costs) is not often displaced in parenting cases, and that I should be alert to the need to identify features which might justify a departure from the general rule. I recognise, of course, that some relevant factors might support an order for costs, while other relevant factors might not. At the end of the day, however, the balancing of such matters is a matter for the Court in the exercise of its discretion.
Having determined the factors relevant to whether a costs order should be made, the trial judge then considered the rules applicable to the nature and assessment of a costs order. His Honour began by referring to Chapter 19 of the Family Law Rules 2004 (Cth) (“the Rules”), noting r 19.01(2) and quoting in full r 19.18 (at [37] – [38]). In this regard, his Honour referred to the “itemised scale of costs” in Schedule 3 (at [39]).
His Honour then explained that “[t]he ‘default’ method for assessing costs is on a party/party basis” pursuant to r 19.18(2), and noted that it is “unusual for [the] Court to make orders on any other basis”, despite having the power to do so pursuant to r 19.18(1) (at [40]).
The trial judge then set out r 19.34 in full in relation to the “assessment principles” which are “to be applied by a registrar when assessing costs payable pursuant to a costs order” (at [41]).
Once the trial judge had established the various bases upon which a costs order may be made, his Honour turned to the law in relation to indemnity costs. His Honour made particular mention of the Full Court decision in Prantage & Prantage (2013) FLC 93-544, where the Court observed that there was “nothing in [the Act] which inhibits the making of an order for indemnity costs” and confirmed that the law relating to such costs had been “well established in this jurisdiction for many years’”. However, his Honour noted the Full Court’s recognition that costs are ordinarily awarded on a party/party basis and an order for indemnity costs is “a very great departure from the normal standard” (see Kohan and Kohan (1993) FLC 92-340 at 79,605) (at [42]). The usual rule that costs are awarded on a party/party basis was deliberately not reconsidered by the Court in Prantage & Prantage at [95] (at [43]).
Thus, in recognising that indemnity costs are not the usual rule, his Honour endeavoured to determine when indemnity costs would be appropriate. First, his Honour quoted Munday & Bowman (1997) FLC 92-784 at 84,660-61 per Holden CJ, where the Chief Judge referred to the decision in Colgate-Palmolive Company and Anor v Cussons Pty Ltd (1993) 46 FCR 225 (at [44]). His Honour noted that this approach remained good law (at [45]). However, his Honour opined that in Prantage & Prantage the “Full Court emphasised that Sheppard J referred to an ‘imprudent refusal of an offer to compromise’ and not to imprudence by a party in his or her general approach to the proceedings” (emphasis in original). In this regard, his Honour considered that the former could be sufficient to enliven indemnity costs, but the latter could not (at [45]).
His Honour further noted that indemnity costs were not concerned with any “ethical or moral delinquency in the antecedent facts” of the proceedings (see NMFM Property Pty Ltd v Citibank Ltd (No 11) (2001) 109 FCR 77), but with the “party’s conduct as a litigant” as directed by s 117(2A)(c) (at [46] – [47]).
His Honour then turned to the decision of the Full Court in Hand and Bodilly [2013] FamCAFC 98 where the court “appeared to accept that costs assessed on a lawyer and client (or solicitor/client) basis [differed] from, and [provided] a different level of indemnity to, costs assessed on a party/party basis (on the one hand) and costs assessed on an indemnity basis (on the other)”. However, his Honour noted the court’s recognition at [100] of that case that solicitor/client costs could sometimes “provide a complete indemnity”. His Honour then quoted [102] of this decision (at [48]).
His Honour then returned to the decision in Prantage & Prantage and referred to the separate judgment of Murphy J where his Honour observed that the rules relating to solicitor/client costs had been repealed “save for the single reference in r 19.18(1)(b) to costs being assessed on a ‘lawyer and client’ basis”. His Honour quoted Murphy J’s judgment at [158] – [160] and [163] in this regard (at [53] – [55]).
His Honour expressed regret that the Full Court in Hand & Bodilly only referred to r 19.04(6) of the Rules, which was not relevant in this matter. Thus the “concerns raised by Murphy J in Prantage regarding the question of whether an award of costs on a solicitor/client basis remains an option under the Rules were not considered” (at [56]).
In concluding his discussion of the applicable law, his Honour said (at [58]):
I accept the guidance of the plurality of the Full Court in Prantage (supra) to the effect that it would ordinarily be appropriate for a judge to consider awarding costs on a solicitor/client basis before awarding costs on an indemnity basis. The precise manner in which costs awarded on such a basis are to be assessed, however, is not as clear as it could be. The assessment principles set out in r 19.34 focus on the manner in which assessments of costs on a party/party basis and on an indemnity basis are to be approached. They give no guidance as to the manner in which an assessment of costs on a solicitor/client basis is to be approached. Murphy J was clearly of the view that such an omission was deliberate. In those circumstances, and in the light of the matters discussed in these Reasons, I would be reluctant to award costs on a solicitor/client basis. In other words, I have considered awarding costs on a solicitor/client basis but have formed the view that an order to that effect would not be just – if for no other reason than the fact that it is likely to condemn the parties to a further protracted dispute regarding the assessment principles that should adhere to such an order.
His Honour then commenced his discussion on whether a costs order should be made, and accepted that the general rule in relation to costs orders was not often displaced in parenting proceedings where the determination of the substantive issue is of great importance to the parties. His Honour also again referred to the need for justifying circumstances to be found before an order for costs can be made. In any case, his Honour was not persuaded that because the proceedings were for parenting orders, his discretion was in any way fettered. However, his Honour indicated that in exercising his discretion he was “prepared to consider whether the case might fall within or contain one or more of the ‘features’ alluded to by the majority of the Full Court in Hawkins & Roe” (at [59]).

His Honour then turned to the s 117(2A) factors. First, his Honour considered the financial circumstances of the parties. His Honour noted that the parties had made consent orders for property settlement on 22 October 2010 and had entered into a Limited Child Support Agreement around the same time. However, as the former matrimonial home sold for less than expected, the consent orders were set aside, with the father instead required to “pay certain outstanding debts of the parties”, and the child support agreement varied so that the father would pay “non-agency” support of $450 per month towards the mother’s car loan. An Application for Consent Orders in relation to the new agreement was filed on 15 March 2012 (at [60] – [61]).
After reviewing the respective financial statements of the parties his Honour concluded as follows:
73.I accept that the mother and Mr [D] are in a stronger financial position than the father and Ms [G] – due to Mr [D’s] significant income and employment benefits. I also accept that the father does not appear to have the means to meet any significant order for costs. To that extent, this factor supports the father's submission to the effect that no order for costs should be made.
74.As I have indicated above, however, the father's inability or apparent inability to meet an order for costs does not, in itself, prevent the making of a costs order. Still, there can be no doubt that it is a factor which the Court must take into account (along with all other relevant factors).
The trial judge then turned to consider the conduct of the parties as litigants pursuant to s 117(2A)(c). First, his Honour noted that, though not legally represented, the father “participated in the trial process fully, confidently and relatively comfortably”. His Honour also noted the submission of the mother that the father was university educated, held a senior position in a major company and was “familiar with lawyers and their advice” (at [77]).
His Honour then quoted his findings in the substantive judgment at [116], [119], [123], [124] and [125]. Particularly, his Honour emphasised that the father was “intelligent and determined”, but was also “controlling, demanding and lacking in insight”. This was demonstrated through the father’s use of “insulting language to the mother’s solicitors”, his manipulation of the mother’s partner, and his failure or refusal “to show respect for the mother’s position regarding the sojourn (in Thailand)” (at [79]).
His Honour opined that as a consequence of the father’s approach, and his refusal to consent to the sojourn despite detailed written communication from the mother, the mother’s legal costs increased (at [80]).
His Honour then detailed the father’s preparation for the case as follows:
81.Importantly, and as referred to in the Judgment at [114], much of the material contained in the father's trial affidavit was of little or no relevance to the question of whether the sojourn should be permitted. The same can be said for much of the other affidavit material filed by the father in support of his case. The material was irrelevant because it had been prepared in support of the father's application for shared care – which application was abandoned at the commencement of the trial in the circumstances described in the Judgment at [20] to [26].
82.The father filed a total of nine affidavits, totalling nearly 380 pages (133 of which were, as the father described them, "research reports"). He later conceded that four of the affidavits were unnecessary and withdrew them when the application for equal shared care was abandoned.
83.Some of the affidavit material filed by the father was prolix and argumentative. It also contained inadmissible evidence and did not confine itself to facts relevant to the issues in dispute.
84.Given the nature of the father's case as it stood at the commencement of the trial, the mother had no alternative but to prepare her case fully on the basis that she was required to meet a claim for equal shared care of the children. As the mother submitted at [83], that preparation resulted in "considerable financial, physical and emotional cost".
Thus, on the basis of the mother’s submissions at [91] – [94], his Honour accepted that the “father’s strategy appeared to involve metaphorically ‘drowning’ the mother in a sea of negativism and unnecessary detail”, making the case “considerably more complex then it needed to be”. Though his Honour opined that it was “never appropriate to dismiss the father’s arguments” due to the importance of the sojourn issue, his Honour was of the view that the father “refused to recognise the mother’s application for what it was: a perfectly reasonable request by the mother, as the principal caregiver for the children, to take them with her to Thailand for a limited period so that she could join her partner (now husband) while he was working on a project there”. This refusal was seen in light of the absence of any “credible evidence that the relationship between the father and the children would be harmed by the sojourn” (at [85]).
The trial judge noted that the father’s strongest argument related to the safety of the children in Thailand in light of the “political unrest in the country at that time, and the volatility engendered by that unrest”. Though his Honour accepted that the father’s other arguments were also significant, his Honour opined that they “did not justify the full-throated attack on every aspect of the mother’s case that characterised the father’s approach to the proceedings”. In this regard, his Honour recorded that at no time “did the father simply ‘step back’ and make a sincere effort to put the mother’s application in perspective” (at [86]).
Thus, though the trial judge accepted that “the father’s maintenance of his opposition to the mother’s proposals” was not relevant to his conduct as a litigant, the fact that the father’s approach was “combative, overly-inclusive and declamatory” meant it “crossed the boundaries of what might fairly be considered reasonable argument”. As such, the father’s opposition “became relevant to his conduct as a litigant”, or, in the alternative, relevant under s 117(2A)(g) (at [87]).
The trial judge then turned to s 117(2A)(e), namely whether any party had been wholly unsuccessful. His Honour began by noting that the “single most significant issue in the case, and the dispute which lay at the heart of the proceedings between the parties, was whether the mother should be permitted to remove the children from Australia for the sojourn”. In relation to this issue, his Honour opined that there was “no doubt that the father was wholly unsuccessful” (at [90]). Similarly, his Honour found that the father was wholly unsuccessful in persuading the court of a number of his submissions (at [91] – [92]).
In relation to the father’s submissions concerning the security of the children in Thailand, his Honour opined that the DFAT travel advisories, discussed in the substantive judgment, were the “single most significant factor supporting a conclusion to the effect that the sojourn should not proceed”. However, his Honour was satisfied that the mother and her partner were in a position to do “everything in their power to ensure that the children [were] not exposed to any unacceptable risks during the sojourn”. His Honour also expressed that orders were put in place to reflect any change in the security level in Thailand (at [93]).
Though the sojourn issue, and the father’s submissions in this regard, were conceded to be of importance by the mother’s counsel, his Honour emphasised that the “proceedings did not comprise a relocation in the usual sense” (see reasons for judgment in substantive proceedings at [125] and [72]) (at [94]).
Thus, at [95] his Honour found:
As I have indicated elsewhere in these Reasons, the father was entitled to oppose the sojourn and to present his arguments in support of his case. However, those propositions are irrelevant to questions relating to the father's success in the proceedings. As Thackray J wrote in Hawkins & Roe (supra), "even a meritorious case can be 'unsuccessful' when the other case is found to have greater merit". I am not persuaded that the father's case could ever have been fairly described as "meritorious", but even if it could be so regarded, the fact of the matter is that it was wholly unsuccessful. What the father most wanted was for the mother's application for orders enabling the sojourn to be dismissed.
Next, his Honour considered the “offers in writing” between the parties. The trial judge noted that prior to the mother filing her initiating application on 2 October 2013 there had been communication between the parties relating to the sojourn for “some five months”. This communication included the parties attending Relationships Australia on 22 August 2013 to no avail. Despite this, his Honour referred to his finding in [125] of the substantive judgment and found that it was clear that “the father never intended to consent to the sojourn” (at [96]).
His Honour then referred to a settlement offer by the mother dated 6 November 2013, which his Honour set out in full (at [97] – [98]). In this regard, his Honour recorded that the mother’s proposals were very similar to the final orders made, “save for the reference to the DFAT travel advisories” (at [99]).
Having set out the settlement offer, his Honour then examined the response of the father. Particularly, the father asserted that the mother’s solicitor was “arrogant” and that the offer sought to sever his emotional and financial relationship with the children. His Honour noted that the husband’s assertions had no basis, and in relation to the latter, were “bizarre” (at [100]).
Additionally, his Honour explained that the father had presented the mother’s solicitor with a “personal wager” in relation to the offer. This response was held by his Honour to be “inflammatory and discourteous” (at [101] – [102]).
Though the father asserted that the offer was not a reasonable offer, his Honour disagreed with this assertion and opined that the “mother’s proposal was reasonable and constructive”. Further, his Honour explained that if the father was concerned about the DFAT travel advisories at the time of the offer “he could and should have raised them with the mother’s solicitors instead of rejecting the proposal in the confrontational manner that he adopted” (at [103] - [104]).
Thus, his Honour concluded that the “mother made reasonable attempts to resolve the matters in dispute between the father and herself”, but it was “clear that the father never intended to resolve the matter by negotiation” which made a “trial inevitable” (at [105]).
Finally, his Honour considered s 117(2A)(g), which allows for the court to take into account such other matters as may be relevant. The mother submitted that the father’s “wager” should be considered under this heading. However, his Honour noted that, to the extent his discussion of the father’s behaviour was not considered relevant under s 117(2A)(c), it “should fairly be considered relevant under s 117(2A)(g)” (at [107]).
Therefore, in concluding his consideration of s 117(2A), his Honour said:
108.In my opinion, there are circumstances which justify the making of an order for costs in the mother's favour. The most significant of those circumstances are –
a)the fact that the father was wholly unsuccessful in the proceedings;
b)the father's conduct as a litigant;
c)the mother's offer to settle the proceedings (and the father's response); and
d)to the extent that they have not been dealt within the other factors, the matters discussed under s 117(2A)(g).
I have given careful consideration to the father's financial position and his apparent inability to meet an order for costs. I have also considered the mother's financial position in comparison with the father's financial position.
110.I accept that the father's financial position is a factor that would mitigate against the making of an order for costs. At the end of the day, however, I am satisfied that the other relevant factors clearly, and significantly, outweigh it. In all the circumstances, it would be unjust and unfair for the Court to fail to make an order for costs in the mother's favour.
His Honour then considered the form of the costs order. First, his Honour explained that, although unusual, the court has the power to make orders for costs other than on a party/party basis (at [111]).
In recognising that the mother sought costs on an indemnity basis, his Honour opined that such an order would “amount to a very great departure from the usual basis upon which costs are assessed”, and thus, the circumstances justifying that departure [must be] exceptional (at [112]). As such, his Honour was “not persuaded that an order for indemnity costs [was] appropriate in the present case”. Though his Honour recognised that the father “if properly advised”, “should have known that his case was not as strong as he perceived it to be”, his Honour was “not satisfied that he should have known that he had no chance of success” (at [113]).
His Honour again referred to the father’s behaviour throughout the trial, and noted that such behaviour could arguably “serve to justify an order for indemnity costs”. However, his Honour found that the “father’s financial position [mitigated] against the making of an order for indemnity costs”. Further, his Honour opined that although the father was wholly unsuccessful in his assertion that the sojourn was not in the best interests of the child, his Honour was not satisfied that the circumstances were “sufficiently exceptional to warrant the approach urged by the mother” (at [114]).
His Honour again referred to his adverse findings regarding the father’s conduct, and added the following (at [115]):
a)although no expert evidence was presented to the Court, the father's approach revealed an absence of preparedness on his part to compromise;
b)the father's case included a claim for equal shared care which was misconceived and never likely to succeed (and which was withdrawn on the first day of the hearing); and
c)the inclusion of the claim for equal shared care meant that the case was significantly more complex that it ought to have been; and
d)much of the material relied upon by the father in support of his claim for equal shared care was either inadmissible or unhelpful.
The trial judge recorded that although “r 19.18(1)(b) provides that the Court may order that a party is entitled to costs as assessed on a ‘lawyer and client’ basis”, his Honour referred to the persuasive argument of Murphy J in Prantage & Prantage that “such an option does not exist and that the rules provide for only two options – being costs on a party / party basis and costs on an indemnity basis”. On the other hand, his Honour recognised the alternative position of the other members of the Full Court in Prantage & Prantage, that “costs can indeed be assessed on a ‘lawyer and client’ basis” and that it would “ordinarily be appropriate for a judge to consider awarding costs on such a basis before awarding costs on an indemnity basis” (at [117]).
In this light, his Honour found that, as it is unclear how costs on a lawyer and client basis are to be assessed, making an order for costs on this basis would be “likely to condemn the parties to protracted dispute regarding the relevant assessment principles” (at [118]).
Therefore, in conclusion his Honour found:
119.In all the circumstances, I am satisfied that I should not attempt to assess the quantum of costs in the present case. It is sufficient that I have determined that an order for costs on a party-party basis is appropriate. The quantum of costs can be assessed by a Registrar in the usual manner.
120.In my opinion, it is just and appropriate that the father should pay the mother's costs of and incidental to the proceedings in their entirety.

Grounds of Appeal

In his amended grounds of appeal filed on 29 September 2015, the father agitated the following grounds of appeal. Leave was granted to the father to further amend Ground 5 at the commencement of the hearing of the appeal, but we left making the formal order until the delivery of these reasons for judgment:
1.The primary judge when considering the conduct of the parties as litigants at [76] – [88] and in particular at [81] – [84] failed to consider the principles contained in Division 12A of Part VII of the Family Law Act 1975 especially s. 69ZN(4), s. 69ZQ(1)(a), (b) and (c) and s. 69ZR(1)(c) so far as they were applied (or not applied) when orders were made on 16 October 2013 and 2 December 2013;
2.The primary judge when considering whether one party was “wholly unsuccessful” at [90] – [95] failed to consider or adequately consider:
a.the finding which determined whether the ‘sojourn’ could occur or not was based upon factors outside the control of the parties, namely the status of the DFAT travel advisories: primary judgment at [210].
b.the clear merit in the appellant’s concern regarding the children’s security in Thailand: primary judgment at [2(a)], [5] – [6], [210] – [216];
c.until the final orders were made on 6 February 2014 at paragraphs 16 – 17 (primary judgment [227), the absence of any proposed order by the mother which would prevent travel to Thailand or would require return travel from Thailand if security conditions there became unacceptable.
3.The primary judge when considering offers in writing at [96] – [105] failed to:
a.consider the status of the DFAT travel advisories when the mother’s offer was made on 6 November 2013 and in particular the appellant’s case information affidavit filed 8 November 2013 at page 9, ninth dot point, which recites the DFAT travel advisory effective at 29 October 2013;
b.adequately consider the significance of the omission of any reference to DFAT travel advisories in the offer, despite referring to such omission at [99] and despite the critical finding about the significance of such travel advisories at primary judgment [210].
4.The primary judge’s order made on 26 September 2014 was unreasonable or plainly unjust having regard to the cumulative impact of all the considerations described in grounds 1 to 3 above and in all the circumstances of this case.
5.In the alternative to amended appeal ground 4, then the form of the primary judge’s order was unreasonable or plainly unjust, by not limiting the scope of the costs order.

Orders sought

In his Notice of Appeal (WA 26/2014) filed on 23 October 2014, the father sought the following orders:
1.That the Orders of 26 September 2014 be dismissed.
2.The Honourable Court grants to the appellant father a costs certificate pursuant to the provisions of s.9 of the Federal Proceedings (costs) Act 1981 (Cth) being a certificate that, in the opinion of the Honourable Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the appellant father in respect of the costs incurred by him in relation to the appeal.
3.The Honourable Court grants to the respondent mother a costs certificate pursuant to the provisions of s.6 of the Federal Proceedings (costs) Act 1981 (Cth) being a certificate that, in the opinion of the Honourable Court, it would be appropriate for the Attorney-General to authorise a payment under that Act to the respondent mother in respect of the costs incurred by her in relation to the appeal.
However, as senior counsel for the father explained during the hearing of the appeal, if we are satisfied that an order for costs was appropriate, but Ground 5 is successful, the order should only provide for the father to pay one third of the mother’s costs.

Discussion

Ground 1

The complaint here is multi-faceted. It is said that at the procedural hearing before Justice Moncrieff on 2 December 2013 the mother should have put her opposition to the orders sought by the father outside of the relocation issue; that Moncrieff J should have limited the trial to the relocation issue; the mother should have raised that with his Honour; or instead of responding to the affidavit material filed by the father the mother could have brought an application relying on the principle in Rice and Asplund (1979) FLC 90-725, and/or seeking a case-management hearing prior to the trial.
However, as is apparent, none of those complaints detail error by the trial judge. Instead, what is suggested is that his Honour erred in failing to recognise those circumstances when taking into account the father’s conduct as a litigant in the lead up to the commencement of the trial.
We consider this ground of appeal to be misconceived, and without merit.
Consent parenting orders were made on 3 April 2012 providing for the children to live primarily with the mother. Then, in May 2013 the mother raised with the father the temporary relocation of the children to Thailand. The father opposed that, and the parties undertook mediation without success, leading to the mother filing an application supported by an affidavit, seeking suspension until 1 August 2015 of the relevant paragraphs of the orders made on 3 April 2012, and the listing of an interim hearing on an expedited basis.
The mother’s application came before an acting Family Law Magistrate on 16 October 2013, and the magistrate determined that given the nature of the dispute the proceedings should go straight to a trial without an interim hearing, and that trial was expedited with a time estimate of one day. The father was ordered to file a Response and an Affidavit, and the matter was adjourned for directions before a judge on 2 December 2013.
Pausing there, it is apparent that the only issue in dispute to this point was that of relocation of the children.
However, the father filed a Response supported by an Affidavit in which he sought to substantially vary the consent orders made on 3 April 2012 as well as opposing the relocation.
On 2 December 2013, the matter came before Moncrieff J. His Honour listed the matter for hearing over three days, commencing on 29 January 2014 before Walters J, and his Honour made orders for the filing of affidavits, the issuing of subpoenae, and generally preparing the matter for trial.
Pausing again, at that time the father, who at all times until the institution of this appeal appeared without legal representation, had only filed his Response and a Case Information Affidavit, and it was not apparent either to the mother or to Moncrieff J the extent to which the father would be pursuing his orders varying the consent orders. A plain reading of the transcript of the hearing before Moncrieff J indicates that the issue being addressed was that of relocation, and the estimate of three days (as opposed to the initial estimate of one day) was primarily because of the matters being raised by the father in his Affidavit as to why he opposed the relocation, and the need for oral evidence rather than that issue being determined on the papers.
It must also be appreciated that the expedition of the matter was solely related to the issue of relocation.
Thus, we do not accept that the trial judge was in error when his Honour said this in his primary reasons for judgment when referring to the hearing before Moncrieff J (at [22]):
…There can be no doubt, however, that the only substantive issue that was to form the subject of the trial to be held on 29 January 2014 was the mother’s proposed temporary relocation – in other words, the sojourn.
However, what then happened is best described in his Honour’s own words as follows (also from his Honour’s primary reasons for judgment):
23.During the period leading up to trial, the father filed a large volume of material, much of which had no relevance to the proposed temporary relocation. For example, the affidavit of his step-mother, [Ms K], was prolix and argumentative; further, it did not confine itself to facts about the issues in dispute and contained inadmissible evidence, including opinion evidence.
24.At the commencement of the trial, it was made clear to the father (who was unrepresented) that he faced significant legal and procedural hurdles if he wished to press his application for the week-about shared care arrangement. Those hurdles included the fact that the 2012 orders had been made by consent and that, if the mother were not to be permitted to relocate to Thailand on a temporary basis as she was seeking, then no “changed circumstances” existed such as to warrant a variation of the 2012 orders (or even a re-examination of those orders): see Rice & Asplund (1979) FLC 90-725, Marsden v Winch (2009) 42 Fam LR 1, DL & W [2012] FLC 93-496 and Bretton & Bondai [2013] FamCAFC 168. Further, no family report or single expert report had been obtained, or even sought. As a result, there was no independent evidence of (for example) [A’s] wishes or the likely impact on the children of the proposed week-about arrangement.
25.To his credit, the father recognised that his application to vary the 2012 orders was premature and misconceived. Indeed, the father explained his decision to include his shared care proposals in his response, and to seek (initially) to press them at trial, by reference to his misunderstanding of the likely approach the Court would take to the dispute in the light of the Full Court’s decision in Goode & Goode [2006] FLC 93-286.
26.Suffice it to say that the father withdrew his application for shared care on the first day of the hearing (29 January 2014) and the trial proceeded on the basis that the only issues for determination by the Court were those relating to the sojourn.
Thus, in terms of costs, by then the damage had been done, and the mother understandably had incurred substantial expense in responding to the father’s material.
It is fanciful to suggest that in the timeframe available, the mother had the option instead of bringing the matter back to court on a Rice and Asplund argument, or by way of a case management hearing.
With this background, and in those circumstances, the father’s conduct as a litigant prior to the commencement of the trial plainly justified an order for costs in favour of the mother. There was no failure by any judicial officer, or by the mother as a party, to abide by the principles contained in Div 12A of Part VII of the Act, which should have been taken into account by the trial judge in considering the father’s conduct. The father must take the responsibility for his own conduct in pursuing orders that had no prospect of success at the time, and in filing affidavits which his Honour described (at [83]) as “prolix and argumentative”, as containing “inadmissible evidence” and which “did not confine [themselves] to facts relevant to the issues in dispute”.

Ground 2

Plainly the father was “wholly unsuccessful” before his Honour because he was unsuccessful in his opposition to the relocation. That outcome is not altered by the fact that the father might have been entitled to oppose the relocation and to present his arguments in support of his position. Indeed, as quoted by his Honour, Thackray J in Hawkins & Roe [2012] FamCAFC 77 correctly observed that “even a meritorious case can be ‘unsuccessful’ when the other case is found to have greater merit”. Nor is it altered because the Department of Foreign Affairs and Trade (“DFAT”) travel advisories were not at a sufficiently high level to persuade his Honour to dismiss the mother’s application. Although it is true to say that the level of these advisories was outside the control of the parties, his Honour found (at [93]) that “the mother and [her partner] are mature and responsible adults and that they would do everything in their power to ensure that the children are not exposed to any unacceptable risks during the sojourn”.
Further, despite the travel advisories being crucial to whether the relocation should be permitted, the father was not prepared to agree to the sojourn regardless of the level of advisory, and the advisories were not the only reason for the father opposing the relocation. Importantly, in respect of every other reason, the father was wholly unsuccessful in persuading his Honour that they should be a basis for dismissing the mother’s application (e.g. see [91] and [92]).
We consider this factor was a proper factor for his Honour to take into account in making an order for costs and there is no merit in this ground of appeal.

Ground 3

On 6 November 2013 the mother, through her solicitors, made an offer in writing to settle the proceedings. That offer is set out in full in [98] of the reasons for judgment.
The father responded rejecting the offer in terms recorded in [100] and [101] of the reasons for judgment.
As his Honour pointed out at [99], “the final orders were very similar to the mother’s proposals – save for the reference [in the final orders] to the DFAT travel advisories.” The relevant paragraphs of those orders were as follows:
16.If during the time the children live in Thailand DFAT issues a travel warning for Thailand at level 4, “Do not travel”, the mother will do all things to return to Australia with the children as soon as practicable.
17.If during the time the children live in Thailand DFAT issues a travel warning for Thailand at level 3, “Reconsider your need to travel”, the mother will reconsider the living arrangements for the children in consultation with the father.
It seems that the complaint here is that in taking the offer and its rejection into account, his Honour failed to have regard to the fact of the importance of the DFAT travel advisories and the omission of any reference to them in the offer. However, to suggest in effect that the absence of any reference to the travel advisories renders the offer unreasonable and justified the father’s rejection of it, is simply a bridge too far. It is true as referred to in the ground of appeal that in his affidavit filed on 8 November 2013 the father recited the then current DFAT travel advisory, but in his response to the offer there is not a word about travel advisories, and it is plain that he did not reject the offer for that reason. Indeed, we find no error in what his Honour said at [104], namely:
I do not agree. In my opinion, the mother’s proposal was reasonable and constructive. It does not appear that the DFAT advisories were concerns from the father’s point of view at that time, but if they were he could and should have raised them with the mother’s solicitors instead of rejecting the proposal in the confrontational manner that he adopted.
This ground of appeal has no merit.

Ground 4

This is a ground which depends primarily on the success of Grounds 1 to 3. Thus, given we have found no merit in those grounds this ground cannot succeed on that basis. However, it seems that the complaint is wider than that, and it is suggested that in all the circumstances of the case his Honour’s order is “unreasonable or plainly unjust”.
As to the relevant circumstances, in the father’s written summary of argument reference is made to the reasons given by the trial judge in respect of the financial circumstances of the parties (at [60] – [74]), but no error by his Honour is alleged, and as far as we can see, there can be no basis for suggesting that there was error in how his Honour took into account these financial circumstances.
There are two other matters referred to in the summary of argument; first, that his Honour “appears to have drawn no distinction between parenting and financial cases and relied, in part, upon a statement by Thackray J in Hawkins & Roe at paragraph 162 of that judgment”; and secondly, that “the Court ought also to have taken into account that best interests are values not facts and different decision-makers might come to the opposite conclusions on the same material and both be correct: …”.
As to the first matter, presumably the complaint is his Honour should have drawn a distinction, and given this was a parenting case, not so readily make an order for costs.
This proposition stems from the majority decision in Hawkins & Roe which his Honour discusses at some length in his reasons for judgment. At [147] the majority in that case said this:
Whilst the categories of occasions when costs may be ordered is not limited, the occasions on which such an order should be made in a parenting dispute should have some particular features. Where there is a complete absence of preparedness to compromise in the face of unambiguous expert evidence, where false allegations are made, or where one party is clearly motivated by self interest rather than the best interests of a child, then a judge may well conclude that there are circumstances justifying an order for costs.
His Honour took issue with the correctness of this statement by the majority suggesting that “if the categories of occasions when costs may be awarded are unlimited, then it is clearly impermissible to attempt to limit them by suggesting that, before a costs order can be made in a parenting dispute, the case ‘should’ have certain particular features” (at [28]).
Further, his Honour quoted [14] of the reasons for judgment of the majority where they said this (at [29]):
In proceedings involving children’s or parenting matters, the general rule (that each party should pay his/her own costs) is not often displaced. The rationale for this practice is that in such matters it is proper that parents are able to put their case in seeking orders which they believe to be in the best interests of their children. It hardly needs to be said that the nature of family court litigation in relation to children is quite different to a commercial dispute in the State or Federal courts.
His Honour then commented as follows (at [30]):
To the extent that the majority might be perceived to be suggesting – in the various passages referred to above – that the discretion of a judicial officer at first instance to order costs should be fettered by rules or guidelines such as those listed above, I would simply record that the exercise of such discretion cannot be so fettered.
His Honour then referred to the dissenting judgment of Thackray J in Hawkins & Roe and quoted [162] as follows (at [31]):
I also respectfully agree with May and Ainslie-Wallace JJ that the “general rule” that each party will pay their own costs is not often displaced in parenting cases, and that the nature of such litigation is quite different to a commercial dispute in other courts. However, the statute itself does not differentiate between parenting and financial cases. The discretion given to a trial Judge to determine a costs dispute, even in a parenting case, is a very wide one, and I am not persuaded there is an adequate basis for overturning the order.
His Honour then concluded as follows (at [32]):
As Thackray J implies, statements to the effect that the “default position” (that each party should pay his/her own costs) is not often displaced in parenting cases are simply statements of fact – or, perhaps, perceived fact. They cannot and do not mandate the setting of a higher standard or threshold test to be satisfied before a judicial officer at first instance can make an order for costs in parenting cases. Such an approach would be in direct conflict with the costs provisions of the FLA. Further, the relevance of an observation to the effect that family law litigation in relation to children is quite different to a commercial dispute in the State or Federal courts seems marginal. If a comparison must be made, then it should be between family law litigation in relation to children (on the one hand) and family law litigation in relation to property or other issues (on the other). The law and practice regarding costs in commercial disputes in State or Federal courts is very different to the law and practice regarding costs in family law proceedings.
We agree with his Honour’s analysis of the statements by the majority in Hawkins & Roe, and are much attracted to what Thackray J said in dissent. The examples given by the majority of circumstances in which a costs order may be made and their statement that in such circumstances “a judge may well conclude that there are circumstances justifying an order for costs” does not fetter the wide discretion reposing in the trial judge as long as they are seen as examples rather than requirements. However if the majority in Hawkins & Rowe, by the use of the words “the occasions on which such an order should be made in a parenting dispute should have some particular features”, were intending to indicate that certain features need to be present before a costs order can be made, we respectfully disagree. The wide discretion in s 117(2) of the Act and lack of distinction between categories of family law cases (including the lack of distinction between parenting and property cases) would in our view render such a conclusion plainly erroneous, place a fetter on discretion which does not have a legislative basis and require us to depart from that conclusion (Nguyen v Nguyen 169 CLR 245 at 268-270; Gett & Tabet (2009) ALR 504 at [261]-[301] especially at [294]; Green v The Queen; Quinn v The Queen (2011) 244 CLR 462 per Heydon J at [84] and [85]; F Firm & Ruane and Ors (2014) FLC 93-611) at [163].
Thus, this aspect of this ground of appeal has no merit.
Turning to the second matter, it has not been made apparent to us where the trial judge has erred. If the complaint is that because best interests are values not facts, and a different judge might have come to an opposite conclusion, his Honour’s decision was not necessarily correct, and it was not open to his Honour to make an order for costs where the father took a different position to what was in the best interests of the children than the mother, then it is not a complaint that finds any favour with us. There are a number of factors, including in particular the conduct of the father as a litigant, which led his Honour to make the order that he did, and we consider that he was well justified in doing so.
Having found the individual complaints to be without merit, there is no basis to find that “the cumulative impact of all of these matters renders the trial judge’s decision unreasonable or plainly unjust” as alleged by the father in his summary of argument.

Ground 5

Although the father’s senior counsel explained that this ground goes to the form of the order, the complaint is that his Honour, instead of providing that the mother receive her costs of the proceedings, ought to have limited the scope of the order, otherwise it was unreasonable or plainly unjust.
No detail in support of this challenge was provided either in the ground of appeal or in the written summary of argument, but in oral argument it was explained that once the issues to be determined were identified by the trial judge at the commencement of the trial, the trial was unremarkable, and costs in relation to the same should not have been ordered. However, in his careful but lengthy judgment, his Honour traced the history of the proceedings and made findings as to the father’s conduct as a litigant, including during the trial, which clearly justify the order for costs extending to the entirety of the proceedings. Of course, there are the issues raised by the father in Ground 1, but we have found no error by his Honour in that regard, and nor are we persuaded that his Honour has erred in any respect in including the costs incurred by the mother in the pre-trial period in his order.
As to the trial itself, there is no challenge to his Honour’s findings in relation to the conduct of the father at trial, and thus, no error has been demonstrated.

We also observe that despite the trial eventually running only on the relocation issue, the father was wholly unsuccessful and that alone can justify an order for costs, including of the trial, being made.
This ground has no merit.

Conclusion

Given that no ground of appeal has succeeded the appeal must be dismissed.

Costs

At the conclusion of the hearing we sought submissions from counsel as to the question of costs depending on the result.
If the appeal was unsuccessful the mother sought an order for costs, but the father opposed any order for costs.
The appeal will be dismissed, and there are plainly circumstances that justify an order for costs being made, namely the lack of success in the appeal. Thus, there will be an order as sought by the mother.

I certify that the preceding one hundred and fifteen (115) paragraphs are a true copy of the reasons for judgment of the Honourable Full Court delivered on 4 April 2016.

Associate:

Date: 4 April 2016